November 17, 1998 HOUSE OF ASSEMBLY PROCEEDINGS Vol. XLIII No.

The House met at 2:00 p.m.

MR. SPEAKER (Snow): Order, please!

Statements by Ministers

MR. SPEAKER: The hon. the Minister of Mines and Energy.

SOME HON. MEMBERS: Hear, hear!

MR. FUREY: Mr. Speaker, today I am introducing to the House of

Assembly a bill to amend the Mineral Act. There are several key components to the bill,

but some of the components are of a house keeping nature.

The key aspect of this bill will amend

Section 31 and add

Section 31.1

which sets out the conditions under which a mining lease is granted, and the requirements

for further processing of mineral resources in our Province.

Our intentions and our policy regarding the requirement for further

processing of mineral resources in our Province have been clearly and consistently

communicated. When it is appropriate for the orderly production of mineral resources and

it is in the best interest of the Province, the further processing must take place here in

Newfoundland and Labrador.

This policy was first reflected in 1995 amendments to the Mineral Act

which required "primary production," meaning the smelting, processing, and

refining of a mineral ore or mineral, to take place in the Province as a condition of a

mining lease, if it was economically feasible to do so.

Government has concluded that the 1995 legislation may be unclear and

may be subject to conflicting

interpretations. This potential for conflict or lack of

certainty is a problem for industry, for government, and for the people of Newfoundland

and Labrador. While the current wording of the legislation may be ambiguous, the intent of

our policy is clear. The bill which I am introducing today proposes new language which

will create certainty, and clearly lay out our policy with respect to further processing

of minerals in our Province.

Our policy is simple. If it is economically viable for primary

production of minerals to take place in our Province, then it should take place in our

Province. The bill which I am introducing today does not change that policy. It does

however clarify the policy and reaffirms the right of government to order further

processing of minerals granted under a mining lease issued by government.

Developers of our resources and investors in our Province are essential

to the further development of our Province's potential. If they are to invest in our

Province, they must be sure that they understand our requirements, and they must be sure

that they can earn a reasonable rate of return. This bill provides that certainty by

establishing a clear and unambiguous public policy framework for the mining industry.

The people of Newfoundland and Labrador, the owners of our mineral

resources, also require maximum benefits from the development of their resources. It is

government's obligation to provide them with that certainty. This bill fulfils that

obligation.

The other aspects of the bill are also important and will modernize

important aspects of the Province's regime governing competitive claim staking, the

issuance of exploration licences and the mineral exploration process leading to the

issuance of a mining lease.

Mr. Speaker, I look forward to the debate on this very important

legislation.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The hon. the Leader of the Opposition.

SOME HON. MEMBERS: Hear, hear!

MR. E. BYRNE: Mr. Speaker, while we have only received the draft

legislation about ten or fifteen minutes ago, and the minister's statement just before

coming down to the House, it seems to me that these are exact type of amendments that we

have been suggesting have been needed since 1995.

SOME HON. MEMBERS: Hear, hear!

MR. E. BYRNE: They have seen the light! This is a government that

(inaudible) only seen the light!

SOME HON. MEMBERS: Hear, hear! Hear, hear!

MR. E. BYRNE: Had the other administration prior to this one, which

included some of the ministers in this one, had taken the recommendations we made in 1995

and 1996 they may not be at this position now.

Mr. Speaker, it is not the first time that this government has acted,

it is not the first time that this government has done it. Early in September if members

will recall the Premier, the Minister of Mines and Energy, must have gotten on the

Internet the night before, because they took they took the opportunity to announce our

energy policy -

SOME HON. MEMBERS: Hear, hear!

MR. E. BYRNE: - about the privatization of rivers, and it was going

to be studied. We will wait for an update from the Minister of Mines and Energy

(inaudible).

I will say, Mr. Speaker, in all seriousness, that any amendments to the

mineral act that ensure maximization of benefits, royalties, jobs, whatever it may to the

people of the Province, let the record show clearly that this party stands in support of

that. Thank you.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The hon. the Member for Signal Hill-Quidi Vidi, does

he have leave?

SOME HON. MEMBERS: By leave!

MR. SPEAKER: By leave.

MR. HARRIS: Thank you, Mr. Speaker. I welcome this legislation

which will strengthen the government's hand in dealing with mineral leases. In fact, I

welcome it because it is very necessary. I do not know whether the government is admitting

it is closing the barn door in some cases after the horse is gone.

I look with some hope at clauses 11 and 12 of the bill which makes it

retroactive to January 1, 1993. I had hoped the first reading of what they were saying

was: All mineral leases granted to this Province back to square-one are now subject to the

act. That is the amendment that I would look forward to seeing when this is debated in the

House of Assembly, Mr. Speaker, along with amendments to the Mineral Tax Act that grants a

ten-year tax holiday to all new mineral developments in the Province.

Oral Questions

MR. SPEAKER: The hon. the Leader of the Opposition.

SOME HON. MEMBERS: Hear, hear!

MR. E. BYRNE: Thank you, Mr. Speaker. I would like to ask a

question to the Minister of Mines and Energy or to the Premier, whoever would like to

answer it, with respect to the royalty regime that IOCC operates under.

Minister or Premier, what is the current royalty regime? What is the

company expected to contribute in royalties this year? What did they contribute last year?

What did they contribute the year before that?

MR. SPEAKER: The hon. the Minister of Mines and Energy.

MR. FUREY: Mr. Speaker, essentially there are two royalties. There

is a 5 per cent of net profits which comes directly from the company, then there is a 20

per cent royalty which comes from the Iron Ore royalty fund. On average over the years -

it depends, it varies - it is about $20 million to $25 million. If you add fuel taxes,

corporate taxes, payroll taxes, that kind of thing, it averages around $30 million per

year.

MR. SPEAKER: A supplementary, the hon. the Leader of the

Opposition.

MR. E. BYRNE: Mr. Speaker, it is acknowledged that the act that

IOCC operates under is different than the act of general application. It has been

acknowledged by officials within the minister's department that had the act of general

application been applied to IOCC the royalties would be significantly higher than what

they are right now. In short, it is apparent that the royalty regime IOCC operates under

is a sweetheart deal, according to Canadian mining standards.

I would like to ask the minister this question. Obviously IOC pays

royalties, and that based upon essentially what are corporate profits. The capital

investment required to reactivate the plant in Sept-Iles will eat into those profits. In

other words, Minister, will he tell us whether it is true that we will not only lose jobs,

we will not only lose the salaries and construction work associated with the recent

decision, and all of the economic opportunities that come with that, but that we will also

be losing royalties? In short, Minister, it is a lose, lose, lose situation.

MR. SPEAKER: The hon. the Minister of Mines and Energy.

MR. FUREY: Mr. Speaker, the logic of the argument is absurd. If you

are going to reduce your unit costs there are basically two ways to do it. You either

increase the volume of your production to get more of your product into the market place

to generate more revenue and more profits, or you turn to the current operation, go inside

of it, and reduce by cutting jobs.

I understand the member yesterday - I have not read Hansard - but if I

was recalling correctly, I think he said he would cancel the project. What that would -

AN HON. MEMBER: (Inaudible).

MR. FUREY: That is what I heard him say. He said he would cancel -

MR. TULK: The former Leader of the Opposition said: If you are not

going to pelletize it here, leave the darn thing in the ground.

MR. FUREY: I have not had a chance to look at the Leader of the

Opposition, but the former leader, whom I have a high regard for, who was a terrific

leader when he was there, says that his position is that if it does not go in Labrador, it

should not go anywhere. We should not allow anything to go outside the Province.

Thirty per cent of the current production of concentrate from Labrador

City goes outside the Province, and has for forty years, and 400 jobs currently depend

upon it. So what he is saying is: Lay off those 400. One hundred per cent of the

production of concentrate at Wabush goes out of the Province. He would lay off those 580

people.

Mr. Speaker, the Atlantic Provinces' Economic Council has come out and

said the logic of what the government has done is irrefutable; it is smart. The

Newfoundland and Labrador Chamber of Mineral Resources representing the entire mining

industry for the Province agrees with the business case that the company has put forward,

and has said that the Province is doing the right thing.

MR. SPEAKER: A supplementary, the hon. the Leader of the

Opposition.

MR. E. BYRNE: Mr. Speaker, again the Minister of Mines and Energy

did not answer the question that was posed to him directly.

Let me ask this question, then: Our understanding, Minister, is that

when the Province was told by IOC that it has no other choice but to reactivate the

Sept-Iles plant, that you, on behalf of government, or the Premier as the head of the

government, or any of your officials, did not even discuss the possibility or the

opportunity with IOC to change the royalty regime. Why was that?

MR. SPEAKER: The hon. the Minister of Mines and Energy.

MR. FUREY: What is the hon. Leader of the Opposition suggesting

now? The company is trying to make itself competitive. He wants the Province to take more

money out of the company and make it less competitive, and the ripple effect would be

layoffs. It is absurd; it is stupid.

MR. SPEAKER: The hon. the Leader of the Opposition.

MR. E. BYRNE: Thank you, Mr. Speaker.

What I am suggesting is that, in the face of such a vast and enormous

opportunity that slipped through our hands, the Province did nothing to ensure that we get

greater revenues or greater impact from that resource.

SOME HON. MEMBERS: Hear, hear!

MR. E. BYRNE: The company is very competitive. It made $110 million

profit last year. It made $47 million profit this year.

The question I asked you is simply this - one question: Why didn't you

or your officials have any discussion with the company about revisiting the royalty regime

that would clearly bring it into line with the royalty regime of general application that

you have for every other mining company that operates in the Province?

MR. SPEAKER: The hon. the Minister of Mines and Energy.

MR. FUREY: Mr. Speaker, a couple of points.

First of all, the company last year - we have to put this in context -

North IOCC, the new majority shareholder, has been there a little over a year-and-a-half.

Their profits last year were extraordinarily high. There is nobody refuting that or

arguing it. It was an exceptional year. Why? For two reasons. They ran the plant at full

capacity for the year, number one; and the Canadian dollar was at an historic low and the

windfall profits coming back against the exchange drove their profits to very high levels.

Yes, they made $100 million last year, but they reinvested $116 million

last year at Labrador City. What else are they going to do for the next five years? For

the next five years they are going to invest well over $100 million every year, for the

next five years, into Labrador City, irrespective of what their profits are.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: A supplementary, the hon. the Leader of the

Opposition.

MR. E. BYRNE: We are about to change the Minister of Education

after the next election, I can tell you that.

SOME HON. MEMBERS: Oh, oh!

MR. E. BYRNE: Now, Mr. Speaker, let me ask -

SOME HON. MEMBERS: Oh, oh!

MR. SPEAKER: Order, please!

MR. E. BYRNE: Yes, Roger Grimes will be Gonzo after the next

election, I can tell you that. That is for sure, absolutely, no question about it.

Now, Mr. Speaker, let me ask the minister this question: In light of

today's activities, where we are changing an existing Mineral Act as it affects an

existing mining company or companies elsewhere in the Province and Labrador retroactively

to 1993, why did you not consider also amending this other mining act, the LM&E Act,

as it affects the IOC company? If you can change

an act for one company retroactively, why

is it that you cannot change the other act for the other company retroactively?

MR. SPEAKER: The hon. the Minister of Mines and Energy.

MR. FUREY: Mr. Speaker, in fact we did. The government of the day

looked at that in 1990. In fact, we tabled legislation here to bring in the LM&E Act

under the laws of general application. We did not proclaim that act because we were given

very strong legal advice, both inside government and outside government, that we would be

attracting a very major lawsuit. The chances were extraordinarily high that the government

would lose, and the damages to the treasury and the cost to the treasury would have been

exorbitant, so we moved away from it, Mr. Speaker.

MR. SPEAKER: A supplementary, the hon. the Leader of the

Opposition.

MR. SULLIVAN: (Inaudible) before they brought it in.

MR. E. BYRNE: The Opposition House Leader is right, that this was

provided through (inaudible).

This is a very important issue because his answer also affects and

impacts upon the initiative launched earlier - that is not the same challenge opened up to

legislation today, where legislation is applied retroactively?

I would like to ask the minister this: In view of the fact that you

have just indicated that you were provided very sound legal advice and opinion both inside

and outside government, would you take it upon yourself to table that opinion and those

opinions in the House of Assembly?

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The hon. the Minister of Mines and Energy.

MR. FUREY: Mr. Speaker, in fact it was the Cabinet of the day that

was advised, both by outside lawyers and inside lawyers from the Department of Justice. I

am not sure what the rules are on Cabinet papers, but if I can make it available I

certainly will.

With respect to the current act that we just announced to the public

generally, and the retroactivity, we took very strong legal advice once again from inside

the Department of Justice and from outside council, James Chalker and partners, a very

reputable, sterling legal firm that gave us very good advice and said: You are on solid

ground to go back to 1993 and to clarify and put some certainty into the 1995 amendments

and the language that was there to clarify and make certain that there was no

misinterpretation, no ambiguity, that everybody knew what the rules were; and the

language, as you will see in the bill, makes that quite clear.

The leader, I think, just said he supports that.

MR. SPEAKER: A supplementary, the hon. the Leader of the

Opposition.

MR. E. BYRNE: Mr. Speaker, one final question.

I hope and trust it is not the same legal advice government took when

they tried to settle on Trans City. I hope it is not the same legal advice that advised

government to appeal Atlantic Leasing, which cost the Province and the taxpayers millions

of dollars.

I would like to ask the minister this final question: Are you not

concerned that allowing IOC to segregate and separate one aspect of its business in terms

of what is economically viable, that you have now defined the question of economic

viability as it relates to Inco and Voisey's Bay?

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The hon. the Minister of Mines and Energy.

MR. FUREY: Mr. Speaker, I am not at all concerned. This is a

specific project in place A versus place B. The merits of the business case stand on their

own.

MR. SPEAKER: The hon. the Member for St. John's East.

MR. OTTENHEIMER: Thank you, Mr. Speaker. My questions today are for

the Minister of Finance and Treasury Board.

I say to the minister that the people of the Province yesterday were

expecting openness and transparency from the minister with respect to the releasing of the

mid-year fiscal statement. The story of the past twenty-four hours is that the true

figures have been hidden; they have been kept from us.

Why is the minister so afraid to do what Ministers of Finance regularly

do, and what is expected of a Minister of Finance, and that is to release the actual

figures, to release a mid-year financial statement as opposed to rhetoric? I ask the

Minister of Finance and Treasury Board: What are the real numbers?

MR. SPEAKER: The hon. the Minister of Finance and Treasury Board.

MR. DICKS: Thank you, Mr. Speaker.

The hon. member laid an intellectual trap for himself. There are no

actual figures. If he wants the actual figures, the actual figures are not available until

after March 31, 1999. All that one can do in mid-year is give the people of the Province

an indication of the tendencies in the economy, whether or not the Province is growing or

shrinking, generally speaking, how your revenues are holding up, whether or not your job

performance is (inaudible), where retail sales taxes are, and so on.

Thank you, Mr. Speaker.

MR. SPEAKER: A supplementary, the hon. the Member for St. John's

East.

MR. OTTENHEIMER: Thank you, Mr. Speaker.

The Minister of Finance and Treasury Board himself, just several weeks

ago, referred to specific numbers. In fact, the media has reported that the minister

himself is quoted as saying that we are in the range of an $80 million to $85 million

deficit.

I ask the minister: Why is it that he is afraid to be honest and direct

with the people of the Province? What are the true numbers? What is his department's

current working estimate of the deficit?

MR. SPEAKER: The hon. the Minister of Finance and Treasury Board.

MR. DICKS: Thank you, Mr. Speaker.

At this stage, as I said in response to the first question, there are

no actual numbers. The media wanted to know, if I were to guess, what it might be. I

resisted and then said: Well, if you asked me to guess right now it would probably be in

the vicinity of $25 to $40 million. That is a fair range.

How you can expect, when you are halfway through the fiscal year, when

you have no idea what the final number is for equalization, and CHST will be, which

constitutes about 42 per cent of our budget, would be foolhardy and foolish. The hon.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: A supplementary, the hon. the Member for St. John's

East.

MR. OTTENHEIMER: Mr. Speaker, in the spring Budget of last year the

Province budgeted a Contingency Fund, which it said would borrow if and when the situation

warranted it. Maybe now the minister can be more direct and honest with the people and

answer this question: What is the status of the Contingency Fund? Was any of the money

spent, was all of it spent, and what was it spent on?

MR. SPEAKER: The hon. the Minister of Finance and Treasury Board.

MR. DICKS: Mr. Speaker, the hon. member's question indicates his

lack of understanding. The Contingency Fund is not to be borrowed. The Contingency Fund is

part of the government's overall budget plan. Even if we spent the Contingency Fund, we

would show a deficit of $10 million. If we do not spend the Contingency Fund, it would

show a surplus of $20 million.

Thank you, Mr. Speaker.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The hon. the Opposition House Leader.

MR. SULLIVAN: Thank you, Mr. Speaker. My questions today are to the

Minister of Health and Community Services.

On May 14, 1997, in the midst of a federal election, under considerable

heat on health care, the minister stood in her place in this House and read a statement

that announced plans to reduce the waiting list for cardiac surgery. That plan included

one point; sending fifty people out of this Province was the plan. Secondly, she stated

that by January of this year, January of 1998 - that was nearly eleven months ago - she

said there would be a dedicated ICU space for cardiac surgery and expanded operating

facilities that would ensure, she said - and I quote - twelve procedures per week on a

consistent basis.

I ask the minister: Why, a year-and-a-half later, have there only been

just over nine surgeries done per week? What is the problem?

MR. SPEAKER: The hon. the Minister of Health and Community

Services.

MS J.M. AYLWARD: Thank you, Mr. Speaker.

As I stated back in May of 1997, we did commit money to make a number

of changes to address the issue around waiting lists for cardiac surgery. Some of that

included a dedicated ICU, which is in place. We also know that we have had to address

other issues, and the most pressing issue right now is the profusionist issue. We are now

working very closely with the St. John's Health Care Corporation to address the issue of

cardiac profusionists. Right across the country they are in shortage. We have been working

with the Corporation to address that on a short-term basis with a long-term plan in mind

and, to the best of my knowledge, they are actively recruiting today for those positions.

MR. SPEAKER: A supplementary, the hon. the Opposition House Leader.

MR. SULLIVAN: Thank you, Mr. Speaker.

Last year there were 430 cases done in this Province, and there were

another 40 done out of the 50 that hopefully would have been done outside the Province

under special funding announced by the department here that covered basic total costs.

As of November 12 of this year, just a few days ago, there were 429

cases done in this Province. That is an average of just over 9 per week, I say to the

minister, not the 12 that would be done on an continuous basis, that she promised us a

year-and-a-half ago.

I ask her: How do you plan on reducing the waiting list for cardiac

surgery when more cases are being added per week than are actually getting done? How can

the minister explain that?

MR. SPEAKER: The hon. the Minister of Health and Community

Services.

MS J.M. AYLWARD: Thank you, Mr. Speaker.

As I have said many times before, one of the reasons why there are more

people being added to the list is because we have been able to improve the diagnostics

associated with people with cardiac disease. The more physicians we put in place with the

ability to diagnose, the more people will go on the waiting lists.

We have acknowledged time and time again that we are very concerned

about the waiting lists, as are all of my colleagues right across the country, and we have

put dedicated money in place to try to address this.

With the third cardiovascular surgeon there is a time allocated for

that surgeon to become prepared and equipped to take on surgeries. He is working quite

closely, as I am sure you are aware, with the other cardiovascular surgeons over at the

Health Care Corporation, and in time will also add to the numbers. But I have also

identified that there have been so other challenges, and the most recent has been the

cardiac profusionist.

MR. SPEAKER: A supplementary, the hon. the Opposition House Leader.

MR. SULLIVAN: Thank you, Mr. Speaker.

People at the Health Care Corporation tell me that there is no increase

in new diagnoses occurring per week over the past several months. The average is not

higher. They have told me that, I say to the minister. How, then, can you account for new

diagnoses increasing at a faster rate? Actually the problem, Minister, is that you had

indicated there would be 12 done on a continuous basis and we are only getting a little

over 9; that is the problem there.

Will the minister admit now that there is not an increase in new

diagnoses over the past several months, that the average is no greater, and in fact a

little less than it was over the previous year, and the reason is because they have not

delivered on her commitment of May of 1997?

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The hon. the Minister of Health and Community

Services.

MS J.M. AYLWARD: Mr. Speaker, all I can say is that unless we are

adding new people to the list, how can the numbers continue to grow? The only reason they

can be added to the list is because they are being diagnosed.

I have also identified that in addition to more people being diagnosed

- because I have to compliment our physicians and our diagnosticians in their ability to

do their work and to diagnose these people earlier. In fact, you might not like it but our

health care system has improved in capability to identify earlier signs and symptoms

associated with cardiac disease, much to your chagrin I am sure, but that is in fact the

way it works.

SOME HON. MEMBERS: Hear, hear!

MS J.M. AYLWARD: In addition to that, Mr. Speaker, we have to have

the qualified staff to do the work that is required. Now unfortunately we need

profusionists in a certain number. We do not have the numbers that we need. We have a

shortage across the country. Our Province is no different and we are actively recruiting,

but we - I, the physicians and the staff - have no intention of doing surgery without all

of the necessary components: the physicians, the nurses, the staff and the profusionists.

MR. SPEAKER: A supplementary, the hon. the Opposition House Leader.

MR. SULLIVAN: Thank you, Mr. Speaker.

There are two ways that you get further behind on a list: You are not

doing as many as you said you would do, or there are new people being added to the list.

New people are not being added at a faster rate, I say to the minister - that is what

medical experts are telling me - so it has to be that you are doing less than you promised

us in May of 1997.

I ask the minister, now that we have solved the operating room space

and the ICU space dedicated to cardiac care - that has been solved, and I am satisfied

that has been solved - will the minister now ensure us that anaesthetists, profusionists,

and other medical people who are needed in this process, are going to be paid on par with

other Canadians to ensure that we maintain qualified people here and solve this serious

problem we are having in our Province today?

MR. SPEAKER: The hon. the Minister of Health and Community

Services.

MS J.M. AYLWARD: Mr. Speaker, unfortunately we live in a society

and in a Province where we have to live within our financial means. We have just concluded

a collective agreement with physicians to the tune of $32 million, which addresses a whole

number of issues. Many of those issues are being resolved as we speak, in terms of

micro-allocation.

Mr. Speaker, we will never be able to afford to pay what many of the

other provinces are paying. We have never been able to do it, and I don't know if we ever

can. Now, if you have a suggestion where you could take money, or take money from other

services in health care, to pay cardiovascular surgeons or profusionists any more than we

are already allocating to the detriment of other people -

AN HON. MEMBER: (Inaudible).

MS J.M. AYLWARD: I am not prepared to go there, Mr. Speaker. We

have collectively agreed and negotiated to a new settlement for physicians. We are doing

the best we can. We have put a lot of money into cardiovascular care, and we are doing the

best we can at this time. Yes, we have difficulties with profusionists, but we are also

actively recruiting through the Health Care Corporation.

There is no magic, Mr. Speaker. You need the people and you need the

proper essentials to do the work, and that is what we are going to do.

MR. SPEAKER: The hon. the Member for Waterford Valley.

MR. H. HODDER: Thank you, Mr. Speaker. My questions are to the

Minister of Education.

Mr. Minister, you admitted in the public press that you knew in April

that there were some difficulties with the financial viability of the Career Academy. I

have to question, why did you fail at that time to exercise the powers granted to you

under current legislation - very specifically

Section 13(b) - to require the Academy to

produce books, records and other documents so that you could protect the best interests of

students at that time, rather than waiting until June or July?

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The hon. the Minister of Education.

MR. GRIMES: Thank you, Mr. Speaker.

We exercised our full duties and responsibilities under the act at the

time.

MR. SPEAKER: The hon. the Member for Waterford Valley.

MR. H. HODDER: Thank you, Mr. Speaker.

Minister, this is a serious question. It means that you did not do

things that you could have done under present legislation. For example, under

Section 19

of the current act, you could have made regulations requiring the private colleges of this

Province to be bonded in the forms and terms and with collapsible security as you would

specific under regulations. Particularly since this legislation has been on the books for

ten years - ten years - why did you and your government for the past ten years fail to put

a bonding regime in place for private colleges?

MR. SPEAKER: The hon. the Minister of Education.

MR. GRIMES: Thank you, Mr. Speaker.

Actually, the legislation respecting private training institutions in

Newfoundland was enacted in 1988 by a previous Progressive Conservative Administration.

Every time we try to mention that they are supporting a party that was actually the

government for seventeen years and could have done something like change the royalty

regime in Labrador West if they thought it was wrong - for seventeen years that they did

nothing about - when we suggest that, they say: Well, I was not here. That was somebody

else. So they disown the Progressive Conservative Party completely when it is convenient.

Mr. Speaker, to the question, the legislation was enacted in 1988 by

the previous Progressive Conservative Administration. The regulations were enacted in 1989

by the first Liberal Administration that had been here in eighteen years, and one of the

regulations that he might want to check that was enacted was a system of bonding which has

been in place for ten years.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: A supplementary, the hon. the Member for Waterford

Valley.

MR. H. HODDER: Thank you, Mr. Speaker.

The minister will know that this legislation was brought in in the

autumn of 1988. He will also know that there was a change of government in April of 1989.

The PC Administration had four or five months to change things; you have had about 110

months to do so.

SOME HON. MEMBERS: Hear, hear!

MR. H. HODDER: Mr. Speaker, I want to say to the minister: Under

Section 19, there are twenty-one categories where you could have made regulations. How

many of these categories did your government make regulations upon, and will you table

those regulations in this House?

MR. SPEAKER: The hon. the Minister of Education.

MR. GRIMES: Mr. Speaker, I am surprised at the request. As far as I

know, every time there are regulations made under

an act they are available to the general

public at the Queen's Printer. These regulations have been downstairs and generally

available to the public, for anyone who wants to see them, since 1989. If the hon. member

would like to get a copy, he can go downstairs and get it right now.

SOME HON. MEMBERS: Oh, oh!

MR. SPEAKER: The hon. the Member for Bonavista South.

AN HON. MEMBER: There are none down there. That is the point, there

are none down there.

SOME HON. MEMBERS: Oh, oh!

MR. SPEAKER: The hon. the Member for Bonavista South.

MR. FITZGERALD: Thank you, Mr. Speaker. My question is to the

Minister of Forest Resources and Agrifoods.

Minister, it is common knowledge that your government directed millions

of taxpayers' dollars - in fact, this government gave property, guaranteed or loaned

money, or guaranteed loans totalling $22 million - to a company known as Integrated

Poultry Limited, to assume the properties and to operate the government-owned Newfoundland

Farm Products.

I ask the minister if some form of accountably was ever put in place to

protect those taxpayers' dollars - dollars that should be accounted for and protected -

and, if so, how was this accountability put in place?

MR. SPEAKER: The hon. the Minister of Forest Resources and

Agrifoods.

MR. K. AYLWARD: Mr. Speaker, yes, this government made a decision

that it was going to get out of the business of producing chicken and stay in the business

of doing other services like health care and education and social services and so on. So

we decided, as a government, that we were going to get out of the chicken business and let

the people who are good at it try to make a go of it and go at it, and we provided some

support for that, funding support. We worked with them for months and months to put

together an arrangement that would see them get a good start and get out there and see if

they could make a go of it.

Mr. Speaker, recently there have been some comments made by the

Opposition, and specifically the Leader of the Opposition, which have not helped this

case, I have to tell you. This is not the government running IPL, Mr. Speaker. IPL is a

private company. We have twenty chicken producers in this Province who have their lives

into this right now, trying to make a go of it. They are trying to turn around a business

which used to be a public sector - the public sector running it - and we want them to run

it and make a go of it.

Mr. Speaker, we are going to continue to support them as best we can.

We have put mechanisms in place, and I will be glad to provide some of those mechanisms to

you here anytime in the next little while.

MR. SPEAKER: A supplementary, the hon. the Member for Bonavista

South.

MR. FITZGERALD: Obviously, Mr. Speaker, there has not been a lot of

accountability put in place in order to protect government's money. I say to the minister:

You give $22 million and I will open a chicken farm tomorrow.

Minister, the provincial government had agreed also to be financially

responsible for any and all environmental liabilities at the Pleasantville Farm Products

site. This is in addition to the $22 million referred to. I ask the minister if there has

been any environmental cost associated with this project and, if so, what is the total

environmental cost that has been brought back to government?

MR. SPEAKER: The hon. the Minister of Forest Resources and

Agrifoods.

MR. K. AYLWARD: Mr. Speaker, if we had kept this company, this

business, we would have had a liability larger than we did in the deal going forward, so

we decided to let the industry themselves run the business. That is what we have done, and

they are trying to do that - without the help of the Opposition, I might add. It is

irresponsible commentary made by the Leader of the Opposition and the Opposition which is

causing some of the problems that company is having now.

The 500 Newfoundlanders and Labradorians who are working down there,

who are trying to make it - the government does not own this any more. The government has

asked this company to see if they can make it, and we have provided assistance which is

less than what it would have been if we had retained it.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: A supplementary, the hon. the Member for Bonavista

South.

MR. FITZGERALD: Mr. Speaker, if it irresponsible to ask the

government how $22 million of taxpayers' dollars was spent then I will plead guilty to

that any day.

SOME HON. MEMBERS: Hear, hear!

MR. FITZGERALD: What a ridiculous statement by a minister of the

Crown.

I say to the minister: Also, Minister, this government was supposed to

be responsible for all severance packages paid out to employees with the disposal of this

particular industry. I ask the minister if would he disclose what that has cost the

taxpayers of this Province?

MR. SPEAKER: The hon. the Minister of Forest Resources and

Agrifoods.

MR. K. AYLWARD: Mr. Speaker, when we announced this arrangement we

put forward all kinds of details about all those arrangements. I will table that again in

the House of Assembly, and it provides a lot of the detail of what he is looking for.

The last four years it cost the public of this Province $29 million to

subsidize the operation. We are now out there this year, and they are trying to break even

and get this thing rolling and make it happen in this Province. We are trying to help them

do that, provide confidence to do that. You know, they are irresponsible comments when

they are made, and the way they have been made, by the Opposition so far. They have not

been helpful at all, giving creditors a lack of confidence in the company. You have every

right to ask the questions, Mr. Speaker. Ask the questions that make some sense.

MR. SPEAKER: Order, please!

Question period has ended.

Petitions

MR. SPEAKER: The hon. the Member for Cape St. Francis.

MR. J. BYRNE: Thank you, Mr. Speaker. I have a petition here today

MR. HARRIS: I thought all the roads were paved in your district.

MR. J. BYRNE: I do not need any petition for roads, I say to the

Member for Signal Hill-Quidi Vidi.

I have a petition I want to present on behalf of almost 1,200 people

from the towns of Pouch Cove, Flatrock and Bauline, Mr. Speaker. The prayer of the

petition is as follows:

To the hon. the House of Assembly of Newfoundland, in Legislative

Session convened:

The Petition of the undersigned residents of Flatrock, Pouch Cove, and

Bauline.

WHEREAS prior to the education referendum the Roman Catholic School

Board and the Avalon Consolidated School Board, with the parents' approval, agreed to

combine St. Agnes and Pouch Cove Elementary schools to create a K to IX school for our

children; and

WHEREAS our new school board approved the same proposal on July 2,

1998; and

WHEREAS the Minister of Education has made a commitment to the Board,

the MHA and the parents of our area that funding to construct the new combined school

would be forthcoming;

WHEREFORE your petitioners urge the Government of Newfoundland and

Labrador to ensure funding is made available as soon as possible for the construction of

our new K to IX school for the benefit of our children of the three communities.

And as in duty bound your petitioners will every pray.

Mr. Speaker, we have a petition here with almost 1,200 names from the

parents of the communities, as I said, of Flatrock, Pouch Cove and Bauline. Before both

referendums the two schools in that area, the school boards, the parents and the teachers

had all come together to agree to have one K to IX school. Both schools down there now are

K to VI.

We have the school board telling us that that whole area of the

northeast zone for the Avalon Board has to be dealt with and straightened away before they

can deal with the area of the St. John's zone.

The Minister of Eduction has told me a number of times in this House of

Assembly that the funding was there. He told the Board some time in early June that the

funding would be made available. I have had many conversations with the Minister of

Education to ask him to have the money forthcoming. I understand from discussions with the

Ministers of Finance and Treasury Board and Education that funding would be made available

in the upcoming year. It was anticipated, and the Minister of Education stated that they

wanted the children to start in this new school in September 1999.

This late in the year, if this had started in July when it was

anticipated, when the school board decided that this would be a new school constructed in

Shoe Cove for those children in that area, then the engineering design, the topographical

work, all that could have been done, the land purchased. Even the site has been chosen.

The three communities, the school boards and the parents came together to pick a site.

There were eleven or twelve sites looked at. It came down to three, and the three

communities agreed that the school board could have the final say. The towns of Flatrock

and Bauline lived up to that commitment when the site was picked for Pouch Cove. I think

it is time that the government of today would support this new school and tell us when the

money is going to be made available for the new school for that area.

I had this petition dropped off to me the other night, and there

probably will be more forthcoming. I anticipate that there will be. It is a very simple

matter. I understand that government would have enough in capital expenditure each year

probably for maybe three or four new schools. This school down there is the number one

priority of the new Avalon Board. The government is looking at some kind of a financing

package - I do not know what may be the details of it - to build a number of schools. If

they could come out and tell the board that the funding is going to be made available to

them in the very near future, they could get underway. The school could be started, the

site work could be started, the design could be done on the new school.

The Avalon Board and myself, I suppose, have gone to the minister a

number of times with this request. It has been approved by a number of boards over the

past few years, as I stated earlier. It seems to me whenever certain criteria or

information is being requested there is always more information being requested. It has

been supplied to the minister. I would want the minister to stand in his place today and

address this concern.

There are 1,200 signatures to this petition. The people down there want

it, it is long -

MR. SPEAKER: Order, please!

MR. J. BYRNE: Just in conclusion, Mr. Speaker. This new school is

long overdue. The parents have been working on this for some ten years. It is very near

now I would think, and again I would expect the Minister of Education to support it.

MR. SPEAKER: The hon. the Member for Waterford Valley.

MR. H. HODDER: Thank you, Mr. Speaker.

I want to rise to support the petition put forward by my colleague. The

people of Pouch Cove, Bauline and Flatrock have shown great leadership. I am very familiar

with these three communities. These people represent groups of individuals who come from

various religious denomination persuasions, and they have decided they would come together

to try to make things better for their children.

We know that it has been a long history with St. Agnes School in Pouch

Cove, a very long history of education with the Pouch Cove Elementary School, which of

course was run by the Avalon Consolidated School Board for many years. It is encouraging

when communities come together, when various schools with different traditions come

together, to make one school and operate on the basis of what is best for the children of

their communities. We want first of all to congratulate the people of Pouch Cove, Flatrock

and Bauline for their initiatives and for putting the interest of children ahead of any

other interests.

We know as well that there had been an allocation of $50 million put

forward in this year's budget for new school construction. The school board has been

assured that there would be funding in place. We want to say to the government that this

is the number one priority for the new Avalon East School Board. Certainly last year it

can be shown that the Avalon East School Board did not get a fair share of the

construction budget dollars. We want to know through this petition what is the

government's priority. When can the people of Pouch Cove, Bauline and Flatrock have an

answer through their school board from the Minister of Education and this government? They

are anxious to get on with their lives. They are anxious to provide a new learning

facility for their children. They are anxious to give their children the very best

opportunities for a better education.

When we listen to various other announcements being made by a whole

variety of MHAs on the government side, we know that the Minister of Education has been

permitting other MHAs in his party to make various announcements and various commitments.

We remind him that there has been a commitment made to the people of Pouch Cove, Flatrock

and Bauline, and that it is imperative that if we are going to provide a better education

in that part of the Province that there would be some commitment made publicly by the

Minister of Education, and that these communities through the Avalon East School Board be

allowed to get on with providing the facilities that are, of course, built with the best

interest of their children at heart. Thank you very much, Mr. Speaker.

MR. SPEAKER: The hon. the Minister of Education.

MR. GRIMES: Thank you, Mr. Speaker.

Just a few brief words with respect to the petition that was just

presented. The only unfortunate

part is that the hon. Member for Waterford Valley, in

supporting the petition, had to try and suggest as he usually does that there is some

political intervention of some sorts going on here which saddens me greatly, suggesting

that Liberal members are out announcing things about schools and so on, which has not

occurred. It is much too serious an issue for that.

The hon. member who presented a petition on behalf of the students and

parents for the Bauline-Pouch Cove area has had numerous discussions with myself and the

Minister of Finance and Treasury Board and others. I think the parents and the students of

the area can take full comfort in knowing that the project will proceed. The only question

has been: When will they get final confirmation as to the money? It is not a matter of if

this is going to process. It will proceed.

We are in the final stages of a very delicate and important discussion

now that we would hope that the Opposition actually would support us when we find the

mechanism. There are a couple of mechanisms that are possible to allow us to acelerate the

number of requests we have for new school facilities so that no particular area has to

wait five, six or seven years when they all would need and like and expect to have these

facilities in the next year or two.

We are in the final stage of those discussions, and at the earliest

opportunity we will come forward. I have indicated to the member opposite actually that I

would be more than pleased to have him announce the new school, because he has lobbied so

hard for it ever since he has been in the Legislature. The parents have come and seen me,

everything that needs to be done between us and the school has been finalized, and it is

only a matter of when we can conclude our discussions about financing. We hope to do it at

an early opportunity.

MR. SPEAKER: The hon. the Member for Signal Hill-Quidi Vidi.

MR. HARRIS: Thank you, Mr. Speaker.

I arise to present a petition on behalf of a number of residents of

Labrador City who are petitioning the House to condemn the provincial government in

supporting the Iron Ore Company of Canada's decision to process Labrador resources in

Sept-Iles, Quebec.

AN HON. MEMBER: (Inaudible).

MR. HARRIS: Hundreds. There is a number of petitioners here, Mr.

Speaker, who urge the Government of Newfoundland and Labrador to reverse the decision

immediately and support a policy of secondary processing within the Province of

Newfoundland and Labrador. We had some amendments to the mineral legislation introduced

today which are designed to do just that, but the same policy is not being applied to

Labrador.

I question the motivations of government here. In particular I want to

question the Minister of Mines and Energy, when he in his correspondence with the Chamber

of Commerce in Labrador says that: Based on an analysis of this aspect of the project

there appears to be little direct gain to the Province related to the construction

project.

Now, Mr. Speaker, I wonder what kind of analysis the government is

doing on construction jobs in Labrador. Is this the kind of analysis that the government

usually uses to evaluate the benefits of construction jobs in the Province? Or is it some

kind of a special analysis designed to down play the significance of 1,150 person years of

employment in Labrador City? I wonder what confidence we can have in the analysis that

government asked for from Hatch Associates, in the analysis that they relied on, and

decided they were going to support IOC instead of the people of Labrador West. Is this the

kind of analysis that they have undertaken?

If this government were announcing a construction project in some other

part of Newfoundland and Labrador involving 400 jobs for two years and 300 jobs for

another year, and fifty jobs for another year, they would be crowing from the rooftops

about the great benefits of the construction jobs being created by this government's

efforts. No, not in Labrador, Mr. Speaker! Because: From a preliminary analysis of this

aspect of the project there appears to be little direct gain to the Province related to

the construction project.

MR. EFFORD: (Inaudible)!

MR. HARRIS: Mr. Speaker, if the Member for Port de Grave had fifty

construction jobs in his district he would be bragging about it. He would have bragging

rights. He would go to Boston talking about it. No sir, Mr. Speaker, not when it comes to

1,150 construction jobs in Labrador. No, there is little direct benefit, little direct

gain to the Province related to this project.

I know the government has hung the Member for Labrador West out to dry

on this decision. I thought yesterday that the Minister of Mines and Energy was prepared

to acknowledge that he too had been hung out to dry and was going to, in fact, resign

today. I thought he was, because it appears that if he is being required to write letters

like this to the Labrador West Chamber of Commerce to try and defend a decision to support

the Iron Ore Company of Canada, I wonder whether he too is being hung out to dry by this

government, and being required to write letters like this. I know the minister will

respond, and maybe he can explain why there is no benefit for 1,150 jobs. That's what the

letter says.

This is a new twist on construction jobs: No direct gain to the

Province. We may hear some flim-flam about capital cost allowance versus this and versus

that. We may hear some flim-flam about that, but the same jobs down in Sept-Iles, Quebec,

are also placing the exact same drain on the capital cost allowance of IOCC; any of those

construction jobs that take place as a result of IOCC capital expenditures. The benefits

are going to go to the tax treasury of Quebec and the expenses are going to come off the

bottom line of IOCC. The exact same situation -

MR. SPEAKER: Order, please!

The hon. member's time is up.

MR. HARRIS: - but no direct gain to the Province, says the Minister

of Mines and Energy, not when it comes to supporting the Iron Ore Company of Canada.

MR. SPEAKER: The hon. the Member for St. John's West.

MS S. OSBORNE: Yes, Mr. Speaker. I have a petition today from the

residents of Labrador City.

WHEREAS we the residents of Labrador City condemn the provincial

government in supporting the Iron Ore Company of Canada's decision to process Labrador

resources in Sept-Iles, Quebec;

WHEREFORE your petitioners urge the Government of Newfoundland and

Labrador to reverse this decision immediately and support a policy of secondary processing

within the Province of Newfoundland and Labrador.

To back up my petition today I have some quotes from people who are

very interested in Labrador, and these quotes were made in this House on May 6, 1998.

"Today we have to look at past policies for guidance to future

policies. We need to ensure always that we achieve the maximum benefit for our people

through any..." development of our resources. That is a good quote. "When we

talk about whether a project is feasible, the law is clear that we don't look at what is

absolutely the most profitable. It must just meet the basic feasibility test in an

economic development."

Further, "...IOC has proven for nearly forty years that it is

feasible to pelletize in Western Labrador."

This is what I am using to substantiate the petition on behalf of the

residents.

"...[I]f we are going to be a forward-looking Province with the

capacity to provide the means for social advancement in this Province, the kind of health

care, the kind of education, the kind of infrastructure as a society that we need and

deserve, that which many other Canadians take for granted, we are going to need to harness

the capacity of our own natural resources on behalf of those we serve."

This is another quote: Mr. Speaker, I listened to other people talk

about the Iron Ore Company of Canada, what an aggressive stand we should take. We need no

advice from those who are of the same party that we had once a president of the Iron Ore

Company of Canada who became Prime Minister of this country, who did not treat us as well

as he should. Now we have another person with the same name who is not treating our people

as well as they should be treated.

There is another quote: It is very interesting now, Mr. Speaker, that

we have to be debating a resolution like this at all, because now that we have started to

develop our natural resources to the degree that we have, it shows the fortitude of this

particular government that we have taken the aggressive action to ensure that we get all

of the benefits from the resources that we will be developing.

These quotes are strong quotes, and I am not repeating them for the

sake of repeating them. I am repeating them because I believe in them. I believe in them

the same as the people who stood and said them believed in them, on behalf of the people

of Western Labrador and on behalf of the people of the Province of Newfoundland.

I agree with the speakers who have spoken so far, that we have to very

cognizant of our natural resources today. We have to ensure, through resolutions like this

and through the government being aggressive, that we get the maximum benefits.

What has happened to this government? What has happened to you over

there, that you cannot stand up for the people of Labrador as was in this resolution?

On behalf of the people of Labrador West I repeat those comments, and I

hope that this government -

AN HON. MEMBER: What would you do?

MS S. OSBORNE: I would not ship our resources out of our Province.

SOME HON. MEMBERS: Oh, oh!

MS S. OSBORNE: No, I would not.

Thank you, Mr. Speaker.

AN HON. MEMBER: (Inaudible).

MS S. OSBORNE: That is exactly right.

MR. SPEAKER: The hon. the Minister of Mines and Energy.

MR. FUREY: Mr. Speaker, (inaudible) the Member for Labrador City

spoke on behalf of the government, spoke eloquently, and it is in Hansard, and that is

government's position for all of these petitions.

Orders of the Day

MR. SPEAKER (Penney): The hon. the Government House Leader.

MR. TULK: Mr. Speaker, Motion No. 3, Bill No. 38, "An Act To

Amend The Mineral Act".

MR. SPEAKER: Motion No. 3.

MR. TULK: If the House would consent, I call first reading on

Motions 3, 4, 6, 7, 9, 10, 11 and 12, leaving out numbers 1, 2, 5 and 8.

Motion, the hon. the Minister of Mines and Energy to introduce a bill,

"An Act To Amend The Mineral Act", carried (Bill No. 38).

Motion, the hon. the Minister of Finance to introduce a bill, "An

Act To Amend The Tobacco Tax Act", carried. (Bill No. 35).

Motion, the hon. the Minister of Justice to introduce a bill, "An

Act To Amend The Judgement Enforcement Act", carried. (Bill No. 34).

Motion, the hon. the Minister of Government Services and Lands to

introduce a bill, "An Act To Amend The Highway Traffic Act (No. 2)", carried.

(Bill No. 29).

Motion, the hon. the Minister of Municipal and Provincial Affairs to

introduce a bill, "An Act To Amend The Assessment Act", carried. (Bill No. 23).

Motion, the hon. the Minister of Industry, Trade and Technology to

introduce a bill, "An Act To Amend The Economic Diversification And Growth

Enterprises Act", carried. (Bill No. 18).

Motion, the hon. the Minister of Works, Services and Transportation to

introduce a bill, "An Act To Amend The Works, Services and Transportation Act",

carried. (Bill No. 27)

Motion, the hon. the Government House Leader to introduce a bill,

"An Act To Amend The Internal Economy Commission Act", carried. (Bill No. 36)

On motion, Bill Nos. 38, 35, 34, 29, 23, 18, 27 and 36 read a first

time, ordered read a second time on tomorrow.

MR. SPEAKER: The hon. the Government House Leader.

MR. TULK: Mr. Speaker, Order No. 4, Bill No. 7, "An Act To

Amend The Credit Union Act."

I believe the Member for Cape St. Francis was waxing eloquently when we

left yesterday evening.

MR. J. BYRNE: And will continue to do so, Mr. Speaker.

MR. SPEAKER: The hon. the Member for Cape St. Francis, speaking in

second reading to Bill No. 7, "An Act To Amend The Credit Union Act."

MR. J. BYRNE: Thank you, Mr. Speaker.

I will continue where I left off yesterday, and that was pointing out

the relevancy of what I was saying with respect to the Minister of Fisheries and the

Credit Union Act, Bill No. 7.

I was talking about the Minister of Fisheries being down in Boston,

trying to sell the Province of Newfoundland and Labrador. I hope he was not trying to sell

out the Province of Newfoundland and Labrador. I doubt that very much because I take the

minister to be dedicated to what he is doing. I have no doubt there, Mr. Speaker.

The Minister of Fisheries is at it again, the poor little man. He is at

it again, talking about something that happened fifteen years ago, and they have been in

power for ten years and have done nothing, when they have seen out-migration flourish in

the Province of Newfoundland and Labrador. That is about the only thing we have seen

flourish in the Province of Newfoundland and Labrador in the past ten years,

out-migration, and they are doing nothing to stop it.

We see the situation with IOCC, too, and what is going to happen there.

I saw a sign yesterday that said: Our resources, our jobs, our future. Our future is going

down the drain as long as this government stays in power, and we will do something very

shortly, in the near future, to address that situation.

With respect to this Bill No. 7, I have a few comments to make on it.

One thing I would say, when this bill was introduced yesterday on second reading, the

Minister of Government Services and Lands stood in his place and made a few very brief

comments. I tried to make a few notes as he was going through his comments and I will just

try to address these notes. Then I have some further notes that I will address here as I

address Bill No. 7, "An Act To Amend The Credit Union Act."

MR. BARRETT: (Inaudible).

MR. J. BYRNE: I say to the Member for Bellevue, I have today, in

the House of Assembly, to be the straight man for the crowd on the other side. They are

that dull. I had to make a comment to get them to wake up.

AN HON. MEMBER: (Inaudible).

MR. J. BYRNE: The Member for Bellevue is addressing that now,

talking about my hair. I say to the Member for Bellevue who has a full head of hair, let

me tell you that God made a few perfect heads, and he covered his mistakes up with hair.

You must have been a major mistake, I would say to the Member for Bellevue.

Mr. Speaker, with respect to the Minister of Government Services and

Lands on Bill 7, he talked about twenty-eight clauses here. There are twenty-eight clauses

in this bill, changes to the act, and he was on his feet maybe two or three minutes. Now I

do not if the Minister of Government Services and Lands takes this bill to be very

serious, but in my mind it is a very serious piece of legislation, because it is going to

affect a large number of people in the Province. It can affect the corporations, it can

affect private individuals, various businesses, anybody that deals with credit unions and

co-ops.

AN HON. MEMBER: (Inaudible).

MR. J. BYRNE: Pardon? Members? It is just as important to members,

because in this bill it now gives the authority that, from what I understand, with the

co-ops they can deal with people outside the credit union.

AN HON. MEMBER: (Inaudible).

MR. J. BYRNE: Yes, (inaudible). I think that you should take it out

and re-read. I will get to that now in a few minutes. With respect to the credit unions

themselves it can deal now with individuals outside the credit union itself. One of the

changes there - I don't know which one, I cannot say off the top of my head -, but in

going through it I think it makes that change that can deal with it. Here it is here. It

says that credit unions will be permitted to enter into arrangements for services with a

person who is not a member, subject to regulations. Not a problem. Well, well, well!

See, I am not surprised, Mr. Speaker. The Premier says: What are you

talking about? Here he has a piece of legislation going through the House of Assembly and

he says: What are you talking about? Typical of the Premier of Newfoundland and Labrador,

over there sometimes with the thumb in his mouth saying: Da da, what do we do?

AN HON. MEMBER: (Inaudible)!

MR. J. BYRNE: What are you getting on with? The Minister of

Municipal and Provincial Affairs, Mr. Speaker, I think he is threatening me, is he?

SOME HON. MEMBERS: Oh, oh!

MR. J. BYRNE: I say to the Minister of Municipal and Provincial

Affairs, if I was a buddy of yours I could bring up a issue here that was addressed

recently by your office concerning a municipality in my town that did not go too far. Now,

no buddy does that!

AN HON. MEMBER: (Inaudible).

MR. J. BYRNE: No, I won't bring it up, but we don't talk about each

other if we are buddies, do we, I ask the Minister of Municipal and Provincial Affairs?

AN HON. MEMBER: (Inaudible).

MR. J. BYRNE: What is the problem? They are all concerned about my

blood pressure, Mr. Speaker. I will tell you one thing about my blood pressure. If I went

outside now and there was a nurse outside to take my blood pressure, it would probably be

the most normal in the House of Assembly, I say to the Minister of Municipal and

Provincial Affairs.

With respect to what I was speaking about earlier with respect to a

clause in this bill, it talks about credit unions being permitted to enter into

arrangements for services with a person who is not a member subject to regulations. We do

not know what the regulations are going to be. That is the point I highlighted when I was

going through the bill. We do not know what impact the regulations will have on

individuals. I think that if what I am assuming to be correct is correct, for the ordinary

citizen who wants to deal with credit unions it could be a positive thing.

Because now when we deal with the banks we see that the banks

themselves, in my mind - I will have to be careful in what I say here. Because if you go

to one bank and you go to another bank, there does not seem to be a big difference in

interest rates, in charges for minor - what would be the right word? - actions that you

would take, or fees that they charge for different services. I deal with the banks and I

deal with the credit union also, and there seems to be a difference, although the credit

unions don't seem to have the financial power behind them that some of the major

corporations have.

Now we are talking about two mergers of two banks. Four banks,

actually. I think the Bank of Montreal and the Royal Bank, and TD and some other bank, are

taking about emerging. What impact would have on the people of Newfoundland and Labrador?

The banks of course will say that it is a positive step, it is for the

improvement of the services and what have you, but if you talk to some individuals with

respect to the banks you will see they do not think that it is a positive step. They do

not think that the services are improving. Everything is becoming too automated.

I was watching a television show last night, I think it was Air

Farce , and they had a spoof on where the interviewer was talking to the head of a bank

and a banking machine. I suppose it kind of ridicules the whole situation. The situation

where credit unions can offer more services to individuals in my mind would be a positive

step forward for the general public.

Also, this Bill 7 amend the Credit Union Act to subject trade

associations to the Act. Trade associations are defined by this bill to mean the Credit

Union Central of Newfoundland and Labrador and the Alliance for Newfoundland and Labrador

Credit Unions Limited. Again, the Minister of Government Services and Lands did not

address that point, really. He was very brief in his introduction of this bill in second

reading.

AN HON. MEMBER: (Inaudible).

MR. J. BYRNE: The Minister of Government Services and Lands says he

will address it in Committee stage. I did not want to get into a

section by

section or

clause by clause address at this point in time.

SOME HON. MEMBERS: Hear, hear!

MR. J. BYRNE: Because time does not allow me to do that, but I am

sure when we get in Committee stage we will. I am getting a round of applause from that

side of the House, as is normal when I am on my feet. I am quite concerned that the

Government House Leader has not been on his feet yet on a Point of Order. Because every

time I get up to speak the Government House Leader is on his feet within minutes.

Also,

Part X of the legislation dealing with the Credit Union Central

is repealed. The new

Part X incorporates into legislation the new definition of trade

associations - again, the minister did not really get into that - which include not only

the Credit Union Central, but also trade associations as defined previously. The purpose

and powers of these trade associations will be described by regulation.

Again, I have concerns, and I would like for the Minister of Government

Services and Lands to respond. When we put

an act through the House of Assembly and talk

about regulations we still really do not know the end result of what is going to happen,

because we do not know what the regulations are going to be, and it gives the government a

free hand basically to put any regulations in place if they want to.

AN HON. MEMBER: (Inaudible).

MR. J. BYRNE: The Member for Humber East is over there, Mr.

Speaker, going at it again as usual, and he does not know what he is talking about. He

will not get on his feet. I suggest that when I sit down the Member for Humber East get up

and speak to this bill and tell us why it is so good that the government is putting it

through the House of Assembly. I doubt if he has even seen it yet, and he is over there

talking. I am sure he will not understand it when he reads it, that is a fact, that is a

given. The poor young fellow, that is all I can say.

Also, here is a good one. Previously in order to sell, lease and

exchange property among other things that a superintendent required that no one creditor

object to the action. Right now the legislation is going to be changed so that if 60 per

cent of the creditors approve, well then the action can be taken. Again, do not ask me

about the section, I can only tell you - it is the

section concerning the 60 per cent

where, in order to sell, lease and exchange property, among other things, you had the full

AN HON. MEMBER: (Inaudible).

MR. J. BYRNE: Bill No. 7. I do not know, I haven't got it here, I

only have some notes I just jotted down when I was going though it, you see. The point is,

in order to lease, sell and exchange property you had to have full agreement by everybody

involved. Now they only require 60 per cent. Again, it could be a positive move, depending

on the situation.

AN HON. MEMBER: (Inaudible) clause by clause?

MR. J. BYRNE: No, I am not doing clause by clause. If I was doing

clause by clause I would be here all night. No, not at all, I would not attempt that,

because that is in Committee stage.

AN HON. MEMBER: (Inaudible).

MR. J. BYRNE: It is hard for you to understand the principles, my

son, I will tell you that.

Mr. Speaker, another point. The board of the Guarantee Corporation is

being increased from six members to seven members. I think the minister when he was on his

feet mentioned that yesterday. He said that it was requested by the credit union groups,

or whatever the case may be. Previously what would have happened was that the credit

unions themselves could recommend three and the government could recommend three, and hey

would elect a chairperson from that group. Now government is planning on recommending all

seven, and really the credit unions will not have any say.

I do not know what the reasoning is for that. I wonder why government

would want to do that. The board of the Guarantee Corporation is being increased from six

members to seven members, with all members appointed by the minister in accordance with

regulations. Back to the regulations again. Again it is going to subject to regulation. We

do not know what those regulations will be at this point in time.

AN HON. MEMBER: (Inaudible).

MR. J. BYRNE: Exactly, but the government is going to appoint seven

people. Before there were three appointed by the group and three by government. Now they

are going to all be appointed by the government because they want full control, I suppose.

Where is democracy?

MR. TULK: (Inaudible).

MR. J. BYRNE: Yes, you should probably be living back in the 1930s

and 1940s, I would say to the Government House Leader, and not in this country but in some

European country, that is where you should be, with big black boots on, Mr. Speaker.

Another

section of the bill is going to add another subsection and it

is going to guarantee the corporation take action to rectify potential problems: A credit

union or trade association is committing

an act or pursuing a course of conduct that

constitutes a practice that might prejudice or adversely affect the interest of the

depositors.

Basically what is happening here, I think, is that they are giving the

group authority to deal with anyone in contradiction of the act, I would think, and the

corporation itself, and the regulations and whatever.

There are some of notes that I made. How much time do I have?

MR. SPEAKER: Order, please!

The hon. member has thirty-three minutes remaining.

AN HON. MEMBER: (Inaudible).

MR. J. BYRNE: Mr. Speaker, I appreciate the Minister of Fisheries

and Aquaculture. No one in this House appreciates the Minister of Fisheries and

Aquaculture as much as I do, because when I am on my feet that man can keep me up for an

extra hour, no problem at all, by his comments.

MR. EFFORD: (Inaudible).

MR. J. BYRNE: Whatever. I have heard the Minister of Fisheries and

Aquaculture down in Boston give a lead balloon speech trying to sell the Province of

Newfoundland and Labrador. He should not talk about people standing in this House of

Assembly making speeches, by any stretch of the imagination.

This bill in itself,

An Act To Amend The Credit Union Act, as I said

earlier, has twenty-eight clauses that are going to address many concerns of the credit

union following, I suppose, or the terms that the Minister of Government Services and

Lands used. I think he did not use "following," but the credit union movement,

that is the word. I think it is growing in the Province.

I know it was only a couple of years ago that I got involved with any

credit unions in the Province, the Newfoundland and Labrador Credit Union.

AN HON. MEMBER: (Inaudible).

MR. J. BYRNE: Definitely. They had a branch on Torbay Road. I've

dealt with the banks for years. I think a lot of people across the country are getting - I

will not use the word fed up - but are having some concerns with all the little fees the

banks use now. Every time you turn around for this little thing, and if you write a cheque

and the amount of money is not there for your overdraft or something like that, $5 here,

$10 there, $0.50 here.

AN HON. MEMBER: (Inaudible).

MR. J. BYRNE: What are you saying, the Member for (inaudible)?

AN HON. MEMBER: You should not be writing cheques.

MR. J. BYRNE: You should not be writing cheques. There are some

people out there, Mr. Speaker, who, when you talk about computers, and computerizing banks

and credit unions and what have you, do not like to use those machines. They are afraid to

use machines, they do not trust the machines, and they feel, especially with the Internet,

that if they use the Internet -

MS THISTLE: (Inaudible) people over forty.

MR. J. BYRNE: Not true. I say to the Member for Grand

Falls-Buchans. She says: That is only people over forty. That is not accurate. She should

know. I would say the Member for Grand Falls-Buchans should get up and speak to this bill,

Mr. Speaker, because I think she worked in a bank or credit union or something some time

ago.

MR. HARRIS: She managed the Newfoundland and Labrador branch in

Grand Falls.

MR. J. BYRNE: Did she? The Member for Grand Falls-Buchans should be

quite interested. I am looking forward to when she gets up to speak to this bill to show

all the pros. Not the cons, because certainly she is not going to say anything negative

towards it. It is a foregone conclusion that she is not going to speak negatively towards

this piece of legislation, but she could get up and enlighten the House from her

perspective -

MR. GRIMES: Point of order, Mr. Speaker.

MR. SPEAKER: On a point of order, the hon. the Minister of

Education.

MR. GRIMES: Yes, Mr. Speaker. I will not interrupt long. I just

wanted to offer the hon. Member for Waterford Valley a copy of the regulations that I just

brought up from the Queen's Printer as per an earlier question today. Maybe he has gone

down and gotten his own copy and this might be redundant, but I certainly just want to

make the offer, Mr. Speaker.

MR. SPEAKER: Order, please!

There is no point of order.

The hon. the Member for Cape St. Francis.

MR. J. BYRNE: Thank you, Mr. Speaker.

I say to the Minister of Education that he must be taking lessons from

the Government House Leader on points of order. Again he got to his feet, and it was just

an abuse of the time in the House of Assembly when we are discussing very serious bills to

get up and try to poke fun at another hon. member of this House of Assembly. He should

have more respect for the House of Assembly than to do that type of thing.

Anyway, back to Bill 7, and really I do not see anything that is

negative there at this point in time. When we get down and do it clause by clause, debate

it in the House of Assembly, and we do some further study on it, there may be some

concerns other than the ones that I brought up here today that the minister will have to

address at that point in time. The Minister of Government Services and Lands is indicating

over there now that he is going to address the concerns that I brought up today when he

speaks in Committee on this piece of legislation.

I noticed, by the way, that there are a number of pieces of legislation

coming forward from the Minister of Government Services and Lands in this sitting of the

House. Six pieces, he is indicating, and I would say most of them were ones that were

withdrawn last spring when they tried to get out of here early in the year.

MR. McLEAN: (Inaudible).

MR. J. BYRNE: Yes, there is a few of them, I say to the Minister of

Government Services and Lands. We are getting bills handed to us right, left and centre

here now. I do not know where they are going to have all the time to debate these bills in

this House of Assembly, unless they are going to have us here again, Mr. Speaker, up until

Christmas Eve this year, sitting night after night all through the night like they did

last year.

AN HON. MEMBER: (Inaudible).

MR. J. BYRNE: We have to act responsibly. We have to discuss these

pieces of legislation, I say to the Member for Humber East.

Anyway, Mr. Speaker, on those few words I am going to sit down now and

have one of my colleagues on this side of the House raise some further concerns on this

piece of legislation.

MR. SPEAKER: The hon. the Member for Signal Hill-Quidi Vidi.

MR. HARRIS: Thank you, Mr. Speaker.

I would like to spend a few minutes talking about the credit union

amendment act that we have before the House, and in part about credit unions in general.

They are a people's alternative to the banks, and this Province has done a fair bit of

regulation in the area of credit unions. I am disappointed to say not really enough in

promoting credit unions as an alternative financial service to the banks, and not only as

an alternative financial service to the banks but one that is community-based,

community-controlled, and in the case of the Newfoundland and Labrador Credit Union, the

largest pool of financial capital controlled inside the Province of Newfoundland and

Labrador, controlled by people in the Province who are in fact members of the credit

union.

We have seen out-migration of people from the Province of Newfoundland

and Labrador but we have also seen out-migration of banking services to areas of rural

Newfoundland and Labrador. I am thinking in particular of the abandonment of the people of

the Labrador Coast by the Bank of Montreal, which took place some years ago. The Bank of

Montreal - it was kind of like the Iron Ore Company of Canada. It was not that they were

not making money; it was that they were not making enough money. In their books, their

branch on the Labrador Coast was not economically feasible or economical viable so they

shut it down.

That left a large number of people without any banking services at all.

I want to tell you that they are now better off because, when the Bank of Montreal left,

the local people on the Labrador Straits, particularly on the Coast of Labrador in the

District of Cartwright - L'Anse au Clair, got together and formed the Eagle River Credit

Union, with the assistance of the Fishermen's Union putting in a fairly substantial

deposit.

AN HON. MEMBER: (Inaudible) video.

MR. HARRIS: I did not see the video. I am delighted they made a

video of it, I say to the Minister of Finance, because I think it is a story that deserves

to be told and retold. It is a story of community control of economical development, and

it is a story that deserves to be told as often as possible. Hopefully members here will

repeat it in their own constituencies, the story of the success of local people

controlling their own financial services and controlling their own savings, making loans

available to their neighbours and people in their local community on the basis of their

understanding of their character and willingness to pay back these loans despite the fact

that they may not have the physical assets or security to back it up.

When the Eagle River Credit Union was formed, they provided an answer -

MR. TULK: How many branches do they have now?

MR. HARRIS: Eagle River?

MR. TULK: Yes.

MR. HARRIS: They might have a few, I do not know. I did not see the

ad.

AN HON. MEMBER: (Inaudible).

MR. HARRIS: I did not see the video, I say to the member, but what

I want to say is that it is a model -

MR. TULK: Are you a member?

MR. HARRIS: I am not a member of the Eagle River Credit Union, no.

MR. TULK: Are you a member of any credit union?

MR. HARRIS: I am a member of the Newfoundland and Labrador Credit

Union. The minister thinks that he knows more about this than anybody else in the House. I

want to tell the minister that I joined a credit union in 1972 here in this Province; I

joined another credit union in Alberta in 1976; I joined another credit union in 1979 when

I came back to Newfoundland; I was on the Board of Directors of the Newfoundland and

Labrador Credit Union for eight years; I was a member of the Credit Union Central of

Newfoundland and Labrador for a number of years, so I know whereof I speak when I talk

about credit unions.

I have some experience with credit unions and would say that my

experience with credit unions would match that of any member of this House, with the

possible exception of the Member for Grand Falls who worked as a manager of a credit union

for a number of years. When I was on the Board of Directors of the Newfoundland and

Labrador Credit Union, the Member for Grand Falls was manager of the Grand Falls branch.

AN HON. MEMBER: (Inaudible) director's fees.

MR. HARRIS: No director's fees, I am sorry to say, a voluntary

position.

Mr. Speaker, I know the members opposite like to make sport, and there

is nothing wrong with a bit of fun, but it is a very important -

MR. EFFORD: I am not having fun.

MR. HARRIS: You never have fun. The Minister of Fisheries never has

fun, I am disappointed to be able to report. He is a sour puss!

If the members of the government are so enamoured with the credit union

movement, you would think they would spend more effort on credit union development in

Newfoundland and Labrador.

Mr. Speaker, changes are being made in this legislation, some of which

I support. I am having some difficulty with the explanation of why we are getting rid of

the Credit Union Central and developing a trade association instead. I am having some

difficulty with the government taking over the Board of Directors directly of the

Guarantee Corporation without having any - at legislatively. I do not know what the

regulations are going to say. Maybe the minister can enlighten us. Maybe they will be

delegates from the organizations that would be in the regulations and not in the act.

The minister is indicating by his comments that what we are doing is

removing the legislative requirement of appointees or delegates from the credit union

movement directly, and that is going to be dealt with in the regulation. I think that is

just a way, I suppose, of conforming the legislation to other kinds of legislation in

allowing some flexibility by regulation, but it is very important.

The minister indicates that this is the trend across the country, that

this is done by regulation, that we are trying to conform our act to the credit union acts

across the country. I know there is a great deal of coordination going on nationally

within the credit union movement, and it is part of an attempt to have the credit union

movement standardized across the country so that the time will come - and perhaps a not

too distant time - when all these organizations can operate together on a national basis

and perform a function as sort of a network alternative to the banking system to give more

strength to the credit union movement across the country.

That is a laudable goal, Mr. Speaker, and on that basis these changes

which are doing that can be supported, but it is very important to continue the

involvement of the members of the credit union, the volunteers for the most part, and of

course some staff people, in the structure of the union all the way through. Because not

only does it provide an opportunity for people to participate in their own banking that

they can control themselves, but also allows to progress and develop through the credit

union movement in volunteer positions and get an handle on some of the financial

structures of the country without having to draw down a million dollar salary like Matthew

Barrett or some of the big banking executives. Ordinary people are permitted and allowed

and encouraged to participate all the way through in the structures of the credit union

movement by being elected to positions by their fellow -

AN HON. MEMBER: (Inaudible).

MR. SPEAKER: Order, please!

MR. HARRIS: - members of the credit unions on a voluntary basis,

and to participate throughout the structures of the credit union movement without having

to be wealthy, without having to be a major shareholder of a bank or a corporation to play

a role in the governance of that corporation.

I know the Member for Grand Falls - Buchans, who understands how credit

unions work, knows that you could progress and advance in the credit union structure by

being elected to the Board of Directors, by being then elected to a Credit Union Central,

by participating in national organizations, all on a volunteer basis, and contribute to

your community, and contribute to creating an alternative financial structure.

You know, we all stand around and complain about the power of the

banks. We complain about how much control they have over people's lives. In the credit

union movement we have an alternative which allows individuals to participate in their own

financial services sector to create their own structures, to provide their own services,

and to do that at an equal or cheaper cost in most cases than the banks themselves.

I want to support this legislation in that it makes the credit unions

in this Province stronger and more in keeping with the legislative provisions in other

provinces, part of an overall national program to build some inter-relationships between

credit unions across the country so that the goal of having some kind of integrated credit

union movement in Canada can be achieved.

You see how in Quebec, for example - we often look at Quebec with some

envy in terms of how that Province looks after its own people and its own natural

resources and takes some control over ours. One of the things that is happening in Quebec

is a movement like the credit union movement. It is called the (inaudible) movement in

Quebec; it is the caisse populaire. They play a very, very significant, important role in

Quebec: Quebec financing. I would say probably the deepest and strongest penetration of

credit union organizations in Canada is in the Province of Quebec with the caisse

populaire, which I think some literal translations would be the people's banks. The caisse

populaire in Quebec play a very, very significant role in financing in Quebec, and they

keep the money of the Quebec people in the Province of Quebec, just as the credit unions

in this Province keep the people's money, keep the savings, and reinvest it in the

Province. That is not what happens with the Bank of Montreal, it is not what happens with

the Royal Bank of Canada, it is not what happens with the CIBC. Their function, in many

respects, is to make profits here and take them out of here and give them to the

shareholders.

The shareholders of the credit unions in Newfoundland and Labrador are

the people of Newfoundland and Labrador, and that money stays here. Not like the big

corporations like Newfoundland Power, which is designed to make money for its shareholder,

Fortis, and they make money for their shareholders which are not by and large

Newfoundlanders. They are making money for shareholders who invest in their stocks in the

Toronto Stock Exchange or wherever they trade.

The credit union movement keeps the money here in the Province,

reinvests the money here in the Province, and as a result contributes to our local

economy.

We want to see the credit union movement develop. We want to see the

money that is here stay in this Province. We want to see that capital used to support

local business, and we want to see that we do have a strong economy. One of the ways of

keeping that economy strong is to have our local capital used to develop Newfoundland

resources.

Mr. Speaker, what I would like to see as part of an economic policy for

Canada and for this Province, and one of the things that the New Democratic Party is

insisting on in Parliament, is that the banks be required to get involved in a community

reinvestment program which requires them to reinvest money in the communities in which

they operate.

Now this is not a terribly radical idea. I know there are people who

say: Oh, you cannot interfere with the banks; you cannot tell them what to do. Well, in

the mega-capitalist country of the world, the United States, they do it. They insist on a

community reinvestment program for banks in the United States. There is no reason why we

cannot do it in Canada. There is no reason why there cannot be a requirement that banks,

with all their money and the people's money, cannot be required to reinvest money in the

community. It is something that the New Democratic Party believes in and wants to require

banks to do.

I know the Government House Leader wants to personalize everything. He

does not want to talk about policy. He does not want to talk about using the government's

ability to pass laws and regulations to insist that major corporations like the banks

reinvest their money and their capital into the communities in which they make their

money. That is what needs to be done, and if this government would concentrate on that

instead of getting on with the nonsense that they are getting on with over there, then we

might see some progress; and if we had a really determined government we might see them

take a strong stand when it comes to issues such as the Iron Ore Company of Canada

investing money in Sept-Iles as opposed to Labrador West.

Thank you, Mr. Speaker.

MR. SPEAKER: The hon. the Member for Waterford Valley.

MR. H. HODDER: Mr. Speaker, I am glad to be able to rise and speak

on this particular bill. As my colleague from Cape St. Francis has indicated, he has just

recently become interested in the credit union movement. Some of us who are -

MR. BARRETT: (Inaudible).

MR. H. HODDER: I have been a member for over thirty years, I say to

the Member for Bellevue, and have been very much involved in the credit union movement in

Newfoundland and Labrador. When the Newfoundland Teachers' Credit Union was run out of the

office on Barter's Hill, when Mrs. Seymour -

AN HON. MEMBER: (Inaudible).

MR. H. HODDER: Yes, they certainly did. I say to the Minister of

Education, certainly if he wants to talk about regulations maybe we can... I will get back

to that particular issue, I say to the Minister of Education, and he will find out exactly

what regulations existed to govern bonding and these kinds of things as they applied to

private colleges, but I digress. I want to speak a little bit about the credit union

movement and why it has been able to grow so successfully.

I say to the Minister of Government Services and Lands that the credit

union movement in Newfoundland and Labrador is very much a part of the whole growth. If

you look at the history of Newfoundland and Labrador, you can look at the whole

co-operative movement and trace it back to the teens, when it was involved with the

Fishermen's Co-operative movement. Certainly there were a lot of failures in that

particular co-operative but it certainly had the right kind of spirit.

As far as the credit union is concerned, I think that Newfoundland and

Labrador have certainly shown their approval. I was talking just a few days ago to some of

my colleagues in the Newfoundland and Labrador Credit Union and they tell me about the

tremendous growth there is in the total assets which are now held by the Newfoundland and

Labrador Credit Union; not only growth in terms of numbers of accounts but in the

diversity of the accounts and the number of people using the credit union as an investment

vehicle of choice.

Mr. Speaker, I note with some interest the questions that have been

raised by my colleague, the Member for Cape St. Francis. He noted that the credit union is

now permitted to enter into a range of services with a person who is not a member -

subject, of course, to certain specific regulations. In my dialogue with the credit union

representatives, this does open up new marketplaces for them.

Mr. Speaker, we note as well that the changes to

section 155 of the

current act - that act stated that a person other than the Central shall not carry on

business of the Central in the Province. That particular

section has now been repealed

and, of course, there is new legislation in this particular amendment that does permit

some changes to that particular of aspect of the act.

My colleague for Cape St. Francis also mentioned the changes in the

numbers of people with the Board of Directors. Previously my colleague said that three of

the six members were nominated by the Board of Directors of the Central, and there were no

term limits, and there have been some changes in that as well.

I listened to the comments made, and want to be repetitive of the

Member for Cape St. Francis. I know the minister has made some notes on those particular

points. I do want to say that in Newfoundland or Labrador, if we are going to encourage

the local business, then the Newfoundland and Labrador Credit Union and other credit

unions should be encouraged in this Province. I do understand that this particular piece

of legislation has been vetted by the credit union movement and has been endorsed by them

and by their Board of Directors. I have checked that out, I say to the minister, to ensure

that these changes are being brought forward with the appropriate dialogue, and that is

encouraging.

Those of us who are members of the credit union find there is a certain

amount of loyalty. As I said to the minister a few minutes ago, my association with the

credit union started about probably thirty-five years ago, maybe thirty-six or

thirty-eight years ago, with the Newfoundland and Labrador Credit Union, now it is called.

Then it was called the Newfoundland Teachers' Credit Union, I do believe my colleague for

Terra Nova will agree, and it was run out of 10 Barter's Hill - one employee. Those of us

who were students at the university in those days would go down. I remember that my very

first loan for university was borrowed from the Newfoundland and Labrador Credit Union,

and Mrs. Seymour. It was a total amount of $350. That was a sizable loan back in 1963, and

that helped me get though that particular year.

I say to members, why did the credit union succeed? It succeeded

because of very personalized service. It succeeded because it was supported by its

members.

As time has gone on, I note as well that nowadays the Newfoundland and

Labrador Credit Union has become one of the most modern institutions in the Province. They

were the very first financial institution to have drive-through banking facilities in

Newfoundland and Labrador, and they are one of the few, I think, that still have that kind

of service available to people now.

We certainly, or I - I can only say for myself here - certainly I am

encouraged by the change in the legislation. It does open up new markets for the

Newfoundland and Labrador Credit Union and for other credit unions, but it does also

assure that those people who invest in the Newfoundland and Labrador Credit Union have

their investments protected adequately and that proper controls are in place to make sure

that in the future, as is now, the regulations there assure that investments are properly

secured and that the kind of confidence that now exist in the credit union movement will

continue into the future.

Thank you very much, Mr. Speaker.

MR. SPEAKER: The hon. the Member for St. John's East.

MR. OTTENHEIMER: Thank you, Mr. Speaker. I have just a few comments

on this Act To Amend The Credit Union Act,

an act with which I am having some difficulty

in terms of really understanding the purpose.

We are talking about a number of changes with respect to the creation

of a Credit Union Deposit Guarantee Corporation. Essentially what it seems to do is shift

the responsibly, shift the accountability, to a different organization, or a different

corporation as it is referred to, and, at the same time, because of the procedure involved

in terms of the nomination and election of the board, and limiting those numbers,

essentially a change in the parent organization.

However, a question that I have for the minister deals with the fact

that it appears that credit unions will be permitted to enter into arrangements for

services with a person who is not a member; obviously, that being subject to regulation.

If that is, in fact, what that particular

section of the amending legislation is all

credit unions in the Province so that they can potentially be equally accessible as are

chartered banks in the Province.

AN HON. MEMBER: (Inaudible).

MR. OTTENHEIMER: I am sorry. Do you want to stand on that?

AN HON. MEMBER: (Inaudible).

MR. OTTENHEIMER: The minister has indicated that he will respond to

that. Certainly when we look at this clearly, it seems that arrangements will be put in

without, in fact, becoming a member - again, that being subject to regulation.

If that is, in fact, one of the main purposes of the amendment, it

perhaps is significant in the fact that it changes the actual purpose of credit unions and

in many ways will allow the general public, again subject to certain restrictions and

controls, to enter into a relationship with credit unions in the Province.

Mr. Speaker, some of my colleagues on this side of the House have

referenced the fact that the guarantee corporation is being increased from six members to

seven with all the members being appointed by the minister, again in accordance with

regulation.

This is perhaps somewhat of concern from the point of view that there

is complete ministerial control over those individuals who will now form the membership of

the board of the guarantee corporation. It appears that in the previous provision there

was some discretion by board members to nominate and subsequently elect their own

membership so there was at least some control by the membership itself. It appears now

that control is absent and there is complete and ultimate ministerial control in terms of

the membership of the guarantee corporation.

Also, we see that there are no term limits. That strikes me as being

somewhat unusual, the fact that there is no limit on the exact term of office. Usually

with any directorship or any appointment with respect to individuals who are entrusted

with certain responsibilities, there would be a term of three, four or five years. It

appears, according to my reading of the legislation, that in certain circumstances there

may be, in fact, no limit and the minister is then free to make initial selections or

appointments, and those particular individuals may be in a position to remain on the

corporation board indefinitely.

Also under

section 21 of the bill, by adding another subsection, that

is subsection (e), to

section 211 of the current act,

section 21 appears to allow the

superintendent or the guarantee corporation to take action to rectify potential problems

when, in the opinion of the superintendent or the guarantee corporation, a credit union or

a trade association is committing

an act or pursuing a course of conduct that constitutes

a practice that might prejudice or adversely affect the interests of depositors.

I guess that sort of supervisory control is deemed appropriate, I say

to the minister, and I have no real difficulty with that. However, I go back to my earlier

point that if, in fact, those individuals initially appointed by the minister for an

indefinite term could ultimately have total control of the corporation, and if there is

very little transition or change in the membership of the board or in the membership of

the corporation, we in fact will have the same people making very protective decisions

that will not be subject to review.

I would be interested in hearing the minister's comment principally on

the point that I mentioned earlier with respect to allowing credit unions the permission

to enter into arrangements for services with a person who is not a member subject to

regulations. I guess more specifically my question to the minister would be: What is the

definition of services? Is the credit union movement in the Province now allowing itself

to open up in a very open way and a very total way so that the general public may now

avail of the services as provided by the Credit Union Deposit Guarantee Corporation?

Thank you, Mr. Speaker.

MR. SPEAKER: If the hon. the Minister speaks now he will close the

debate.

The hon. the Minister of Government Services and Lands.

MR. McLEAN: Thank you, Mr. Speaker.

I will say to the members opposite that in the Committee stage I will

have clarifications for the questions that they have asked.

I would say to the House that since I became the minister I have had

numerous meetings with the credit unions because when I started it seemed as though the

biggest focus of the credit unions was trying to sort out all of their differences and

arguments that they were having with each other. I believe we have moved beyond that stage

now to a situation where the credit unions are out there now doing what they are set up to

do and legislated to do, which is to give the public an opportunity to do their banking

facilities and other kinds of activities with them instead of the general banking

community.

I would say to the House also that some of the credit unions that have

really progressed... The Member for Signal Hill - Quidi Vidi mentioned the Eagle River

Credit Union, and that is perhaps one of the most progressive credit unions that we have

in the Province. They have really come a long way in the last few years. They have

purchased the White Hills branch in St. Anthony, and they have a number of branches up and

down the Coast of Labrador.

Maybe I could just say, in closing debate, that one of the things that

the Eagle River Credit Union has done and has been able to do is to deal with all of the

residents of the Coast of Labrador from Cartwright South in regard to dealing with small

business loans and community council loans which, in other words, would have had to go out

of that part of the Province altogether because there are no banking facilities other than

the credit union.

I would say that in Committee stage I will deal item by item with the

concerns that the Opposition members have raised.

Mr. Speaker, with that I will close debate on second reading of Bill

No. 7, "An Act To Amend The Credit Union Act."

On motion, a bill, "An Act To Amend The Credit Union Act,"

read a second time, ordered referred to a Committee of the Whole House on tomorrow. (Bill

No. 7)

MR. SPEAKER: The hon. the Government House Leader.

MR. TULK: Mr. Speaker, Order No. 11, second reading of a bill,

"An Act Respecting Co-Operatives". (Bill No. 10)

Motion, second reading of a bill, "An Act Respecting

Co-Operatives". (Bill No. 10)

MR. SPEAKER: The hon. the Minister of Government Services and

Lands.

MR. McLEAN: Thank you, Mr. Speaker. Bill No. 10 is a totally new

act, "An Act Respecting the Co-Operatives".

Maybe I could first start off by indicating that the present

legislation under which co-ops operate was enacted in 1939. It is interesting that this is

our fiftieth year of Confederation and we are now changing the act of the credit union

co-operative movements to have them separated so that the co-op act is

an act on its own,

strictly for cooperatives.

Here are just a few of the highlights that I could get into in this

particular portion. As of today, the co-operatives and the credit unions are entirely

different types of businesses and each now need their own separate acts in order to

function. This new act for the credit unions will serve as a legal framework for

co-operatives and provide for modern incorporation procedures, more flexible methods of

obtaining capital such as preferred shares from non-members, and greater decision making

authority for boards of directors. Under this new act government will no longer be

involved in the financial examination of cooperatives. Co-operatives would be responsible

for obtaining their own independent financial audits for the protection of their members.

Government is confident that this new act, specially drafted for

co-operative organizations, will provide for a co-operative movement with more decision

making authority and a more flexible ability to operate.

Under the new act, responsibility for the operation of co-operatives

will be placed with the board of directors and the members of the seventy-one registered

co-operatives we have in the Province today. This legislation is similar to new federal

legislation that is in effect for co-operatives. The new act provides a clear definition

of four types of co-operatives: consumers, community service, housing, and worker.

Provision is also made to register extra-provincial co-operatives.

Here are just a few tidbits of information about co-operatives.

Co-operatives in Newfoundland and Labrador right now employ 1,400 people, have a

membership of 74,000 people, has total assets of about $80 million, and the annual

business volume is about $131 million. It is a very extensive movement, certainly with a

greater interest in expanding throughout the different parts of the Province.

I guess the debate will take place more so in the Committee stage,

because I will just close off by introducing second reading to

An Act Respecting

Co-operatives, and give an opportunity for members opposite to identify for me some of the

areas that they may have concerns with.

Thank you, Mr. Speaker.

MR. SPEAKER: The hon. the Member for Cape St. Francis.

MR. J. BYRNE: Thank you, Mr. Speaker. I stand in my place today to

say a few words with respect to this new act or bill that is being presented,

An Act

Respecting Co-Operatives.

It is a quite interesting comment that the minister said when he was

introducing this for second reading. He said that the present legislation with respect to

co-ops was introduced back in 1939. It just so happens I'm reading a book now by Peter

Neary, Newfoundland in the North Atlantic World 1929 to 1949 . To be here today, and

to be referring to a piece of legislation from back in 1939 that is still in force today,

that the co-operatives are being regulated by, is quite interesting. I would say it is

about time we do something to separate the co-operatives from the credit unions. I think

that is what this is all about.

The minister said that the two different groups, the co-ops and the

credit unions, are two different types of businesses today, and that this needs to be

addressed. I would think he is correct in what he states. I do not have much personal

experience with co-operatives, I would have to say, but there are four different types, as

the minister referred to in his comments.

I find them interesting actually. There are different types. There are

the consumer co-operatives, which would be co-operatives like, I would think, what you saw

on Logy Bay Road or Topsail Road. They deal with produce, supermarket types of things,

clothing and what have you. This new act will address the concerns, interests and the

regulations that would be required to properly administer these types of co-ops with the

distribution and the selling of foods.

As a matter of fact, my father-in-law was a member of the Co-op on Logy

Bay Road. Actually there were probably some dividends that would be returned to them on a

yearly basis, I think. if they wanted them. I think that is the way it worked, previous to

this now. It is unfortunate that that co-operative on Logy Bay Road closed down a few

years ago. It seemed like many of the older people were into the co-operatives more so, I

think, than the younger people of today.

AN HON. MEMBER: (Inaudible).

MR. J. BYRNE: There are how many? Eighteen consumer co-operatives

today operating, but the minister mentioned that there were seventy-one registered

co-operatives. Different kinds. He mentioned seventy-one registered co-operatives, and

there are eighteen different kinds. Is that what you are talking about?

AN HON. MEMBER: (Inaudible).

MR. J. BYRNE: Eighteen consumer co-operatives. I have you now. That

was just an epiphany I suppose, Mr. Speaker. In the meantime, there are eighteen consumer

co-operatives throughout the Province of Newfoundland and Labrador. Again, of course, the

interests of the members have to be protected. That is an accountability, that is a

responsibility of government, to make sure that the members are protected in that time. If

they closed down for any particular reason, if they went bankrupt or whatever the case may

be, I suppose, all those types of concerns are addressed in this new act, and rightly so.

Again, the co-ops from this piece of legislation will have their own

audits that will protect the consumer, I suppose, or the members of the co-operatives. I

know they have certain registration fees and what have you. The consumer co-operatives, it

seems, would probably be the most popular I would think in the Province. I am not sure.

The Minister of Government Services and Lands talked about twenty-eight

housing co-operatives. With respect to the housing co-operatives, there is one in St.

John's that I am a bit familiar with. I will not name it, but it used to come under the

Canada Mortgage and Housing Corporation, federal co-operatives.

I had a person in my district, a constituent, who had some concerns

with the way some of these co-operatives were run in the past. It seemed that sometimes

these co-operatives could not be family oriented for housing corporations, and that

certain individuals - what would be the right way of putting it? - would have more of an

opportunity to get into some of these housing corporations by who you know rather than

what you know, that type of thing. I would assume this new act would address those types

of concerns, I would say to the Minister of Government Services and Lands.

Also, there are community service co-operatives. I am just curious -

AN HON. MEMBER: (Inaudible).

MR. J. BYRNE: Will I give it to him again? I think that man must be

a masochist. The Minister of Fisheries and Aquaculture must be a masochist, he must love

punishment, Mr. Speaker. I let him walk out the door and try not to comment too much and

concentrate on this bill.

Anyway, let me talk about community service co-operatives. I would

think, from what I understand, various communities would come together with some kind of a

business or venture -

AN HON. MEMBER: (Inaudible).

MR. J. BYRNE: The what? All different types, like day care. The

Minister of Government Services and Lands says craft development groups and all this type

of thing, Mr. Speaker, which create jobs in the Province of Newfoundland and Labrador.

I have to say this. I am impressed with the Minister of Government

Service and Lands today on this co-operative bill because he has all the numbers at his

fingertips, Mr. Speaker. He has more than I think -

AN HON. MEMBER: (Inaudible) better than the Minister of Finance and

Treasury Board.

MR. J. BYRNE: He is better than the Minister of Finance and

Treasury Board, there is no doubt about that. The Minister of Finance and Treasury Board

made a presentation in this House of Assembly yesterday, a ministerial statement, giving

the financial situation of the Province of Newfoundland and Labrador, and no numbers, Mr.

Speaker, not a number. The Minister of Government Services and Lands today has the

numbers.

I had to laugh today when the Minister of Finance and Treasury Board, I

think, was answering a question. He was talking about: We have to wait until the end of

the year to see where we really are to find out what the situation is with the Province of

Newfoundland and Labrador with respect to a surplus or a deficit.

I would venture to guess if this Province today, and the minister was

in his place yesterday giving a statement, and there was a $2 million surplus for the

Province of Newfoundland and Labrador, he would have the figures on that. He would be able

to show them in the House of Assembly. He could not show them because now it could be $40

million, it could be $25 million, it could be $50 million, it could be $80 million. These

are the numbers we have heard so far, I say to you, Mr. Speaker, with respect to the

situation of the Province today. We may end up with a $50 million deficit, we may end up

with an $80 million deficit by the end of the year. If we end up with a $80 million dollar

deficit, in actual fact it will be $110 million, because in the Budget they had a $30

million contingency fund. That is gone somewhere, we don't know where yet.

I digress. I will get back to Bill 10,

An Act Respecting Co-Operatives.

The community co-ops again across the Province, you said it was eighteen or twenty-eight,

which was it? Thirteen co-operatives, throughout the Province, creating jobs I would

imagine where they can. That is I suppose the intent. We have workers -

AN HON. MEMBER: (Inaudible).

MR. J. BYRNE: I know, I have seen them, I have read it, I say to

the Minister of Government Services and Lands. He said that Bill 10 gives a definition of

An Act Respecting The Different Co-operatives. I did not read it all, to be honest with

you. I read a good portion of it. I did read the

definitions, Mr. Speaker, and I am

surprised that the Minister of Government Services and Lands read the

definitions. He

knows them anyway.

Now to the workers' co-operatives. Basically they are enterprises that

are set up for the members themselves to create jobs for themselves, I would think. That

would be basically, in my terms, what a workers co-operative would be.

I was surprised when the minister said that (inaudible). It has been

almost sixty years that we have had the legislation, the act, and there were never any

changes made to it, or updating. The minister says there was some amendments made over the

years but nothing substantial to address the concerns, the interests of members of

co-operatives. The minister tells me the old act did not have any definition in respect to

co-operatives, and we do have that now. That is good to see. There are -

AN HON. MEMBER: (Inaudible).

MR. J. BYRNE: Pardon? Mr. Speaker, every time I am on my feet I

have to address the Government House Leader. Because the man is supposed to show an

example. The Premier picked the best man on that side of the House, he said - in his mind,

not my mind, in the Premier's mind -, the best member on that side of the House to be

Government House Leader, and he is the worst in the House of Assembly for following

regulations, for interrupting people.

AN HON. MEMBER: (Inaudible).

MR. J. BYRNE: The regulations. There are certain House proceedings

and regulations that should be followed. A bit of respect. Well, not regulations, but

policies and what have you, Mr. Speaker. The wanton disregard for decorum in the House.

The Government House Leader has that attitude.

AN HON. MEMBER: (Inaudible)

MR. J. BYRNE: No, I don't need to repeat that, I say to the

Government House Leader. I am waiting for people on that side of the House to get up and

speak to the legislation the government is bringing in. We have the different ministers -

the Ministers of Government Services and Lands, Municipal and Provincial Affairs -

bringing in legislation in this House of Assembly. The ministers get up and speak,

introduce it, but they are not getting the moral support from the members on that side of

the House, from the back benchers. It has to be pretty lonely for the ministers.

AN HON. MEMBER: (Inaudible).

MR. J. BYRNE: Will you? Okay, the last five minutes. The Member for

Conception Bay East & Bell Island is going to get up and speak to this legislation and

support it, I would imagine. I cannot imagine him doing otherwise.

AN HON. MEMBER: (Inaudible).

MR. J. BYRNE: Pardon? Mr. Speaker, the Member for Conception Bay

East & Bell Island makes a good point that I am supporting this legislation. I am

supporting it because this is only second reading, and we will be getting into Committee

where we go clause by clause. We will have some further discussion at that time, I would

imagine, Mr. Speaker, on the various clauses. There are 162 clauses to be discussed.

With respect to that, I have to make this point. When I was up speaking

a while ago we had a number of bills dropped off on my desk. The Minister of Finance and

Treasury Board was out when I spoke earlier on these credit unions -

AN HON. MEMBER: Out to lunch.

MR. J. BYRNE: He is out to lunch all right. (Inaudible) out to

lunch, he was out, but I will tell him this. Today I set you up in question period. I do

that every now and then to see if you are quick enough over there, to see how alert you

are, Mr. Speaker, and today you responded very well, I would say. Unusually.

AN HON. MEMBER: (Inaudible).

MR. J. BYRNE: Mr. Speaker, I am supporting this so far as we review

this piece of legislation, 162 clauses in the bill. I expect as I said earlier that we

will get into further debate in the Committee stage.

The Minister of Government Services and Lands made another interesting

point. Again, I am impressed with the Minister of Government Services and Lands today

because of all the bills that he has been introducing in this House of Assembly so far, he

seems to know a little bit about this one.

AN HON. MEMBER: His constituents are not impressed.

MR. J. BYRNE: I do not know. No, I am not getting into that. He did

tell me this: With respect to co-operatives, there are 1,400 people involved in

co-operatives in the Province.

AN HON. MEMBER: Employees.

MR. J. BYRNE: Employees. You said people earlier, but employees -

AN HON. MEMBER: (Inaudible)

MR. J. BYRNE: Did you? I stand corrected. Fourteen hundred

employees, that is a good number, I must say. I am impressed, I did not know that.

AN HON. MEMBER: (Inaudible).

MR. J. BYRNE: I have that here, 74,000 members. Seventy-four

thousand members and 1,400 employees. That is impressive, I have to say.

AN HON. MEMBER: (Inaudible).

MR. J. BYRNE: I did, I just said that. Are you a parrot, I ask the

Member of Humber East?

MR. SULLIVAN: No, just an ordinary sandbagger, that is all.

MR. J. BYRNE: An ordinary sandbagger, that is what the Member for

Ferryland said. Eighty-four million dollars, I say to the minister. Did you say $84

million?

AN HON. MEMBER: (Inaudible).

MR. J. BYRNE: Eighty million dollars in assets. That is quite

impressive, I say. Maybe we should have more co-operatives. That is what happens when

people cooperate.

AN HON. MEMBER: (Inaudible).

MR. J. BYRNE: Mr. Speaker, listen to this. I cannot believe what I

just heard from the Government House Leader. When was