Newfoundland and Labrador Hansard — Statements by Ministers — 18 November 1998 (43rd General Assembly, 3rd Session, Vol. XLIII No. 43)

1998-11-18

Newfoundland and Labrador — Debates (Hansard)

Newfoundland and Labrador Hansard — Statements by Ministers — 18 November 1998 (43rd General Assembly, 3rd Session, Vol. XLIII No. 43)

1998-11-18

Newfoundland and Labrador — Debates (Hansard)

November 18, 1998 HOUSE OF ASSEMBLY PROCEEDINGS

Vol. XLIII No. 43

The House met at 2:00 p.m.

MR. SPEAKER (Snow): Order, please!

Before we begin our routine business, the Chair would like to take this

opportunity to recognize and welcome new and returning Commissionaires. Our new

Commissionaires are Gwen Sprett, Robert Triska, Calvin Vincent and Peggy McCleod. Our

returning Commissionaires are Ladd Bursey, Kathy Reardon, and Yves Choquett.

SOME HON. MEMBERS: Hear, hear!

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

MR. FITZGERALD: Mr. Speaker, I wonder if I could have leave of the

House for a few brief minutes.

MR. SPEAKER: Does the hon. member have leave?

AN HON. MEMBER: Yes, go ahead.

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

MR. FITZGERALD: Mr. Speaker, I would just like to speak very

briefly about a new industry that opened up a few months ago in my district, Catalina, an

industry that employed up to 175 Newfoundlanders, an industry that is owned by

Newfoundlanders, operated by Newfoundlanders, and producing a product second to none in

this world.

SOME HON. MEMBERS: Hear, hear!

MR. FITZGERALD: Mr. Speaker, I brought a sample of what is being

produced at that particular industry, and I have it with me here today. I am going to pass

it around the House and let the people in the people's House take a look at those seal

skins that are being produced in a plant in Catalina. I will pass it along and let each

individual member look at the product, and hopefully the media will pay some attention to

it as well.

This particular company produced over 1,500 tons of seal oil this year,

employed 175 Newfoundlanders with a payroll in excess of $1 million. I just want to make

the House aware of that, and to say that this is going to be an industry that is not new

to the Province because it was always carried out in a very small way, but today it is

being done commercially. It offers an opportunity for rural Newfoundlanders and

Labradorians to be able to live and raise their families right here in this Province.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The hon. the Minister of Fisheries and Aquaculture.

MR. EFFORD: Seriously, Mr. Speaker, I accept the flattery from my

colleague opposite.

SOME HON. MEMBERS: Hear, hear!

MR. EFFORD: The one and only time I accept anything from a Tory.

Seriously, Mr. Speaker, what the hon. member should have also mentioned

is that because of the new policy that this government brought in a little over two years

ago, it was the first time in the history of the Province that we had a seal tannery. In

other words, we are not allowing any product to go out of this Province to be further

processed anywhere else.

SOME HON. MEMBERS: Hear, hear!

MR. EFFORD: To add to that, we now have the second tannery, one

which will be opened and operating this year in the member's district, Baie Verte.

To add to that, we have now the largest production of seal oil capsules

in the world. We just had a company come in from China, go down to Port Union, and in one

order buy 2 million capsules to take back to China.

SOME HON. MEMBERS: Hear, hear!

MR. EFFORD: Mr. Speaker, we are moving rapidly in the right

direction - a new turn for the future of the fishing industry presented by this

government.

SOME HON. MEMBERS: Hear, hear!

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

MR. HARRIS: Thank you, Mr. Speaker.

This is the second sample we have been presented with in the House.

Last fall I was given a package of seal oil capsules by the Minister of Fisheries and

Aquaculture. I used them all winter and it helped my arthritis tremendously. Now we have

other material evidence of the ingenuity of Newfoundlanders and the ability to produce

first-class, world-class products from our own natural resources.

I am delighted with the success in the member's district and the

forthcoming news we are going to hear about in Baie Verte. We are developing these

products, notwithstanding the kind of stuff that goes on internationally about this

particular product. It is a worthy product, deserving of support and deserving of any kind

of market it can receive.

Statements by Ministers

MR. SPEAKER: The hon. the Minister of Fisheries and Aquaculture.

SOME HON. MEMBERS: Hear, hear!

MR. EFFORD: Mr. Speaker, there is more good news.

Now that the peak period of activity for our commercial fisheries has

passed, I am pleased to provide hon. members with an overview of the industry's

performance so far this year.

Preliminary figures indicate that to date there has been an increase in

employment, an increase in landings, an increase in landed value, and an increase in

export value.

For the January to October period this year, up to 25,000 people were

directly employed in the fishing industry. For that period, the average monthly employment

in the fish harvesting and processing sectors was 17,400.

AN HON. MEMBER: How many?

MR. EFFORD: Seventeen thousand. That is the average monthly

employment - 17,400 - with a total of 25,000 people employed.

SOME HON. MEMBERS: Hear, hear!

MR. EFFORD: Mr. Speaker, that is an increase of 2,000 - or 13 per

cent - over the same period in 1997. Of that increase, 1,100 were employed in the

harvesting sector and 900 in the processing sector.

What I find most encouraging is not only that more people were directly

employed by the fishery but that many were working for longer periods than previously.

Furthermore, we estimate that this fishing activity is generating the

equivalent of an additional 5,900 jobs elsewhere in the provincial economy.

SOME HON. MEMBERS: Hear, hear!

MR. EFFORD: In short, the fishing industry is responsible for close

to 31,000 direct and indirect jobs in this Province. Clearly, the fishery is contributing

in no small measure to the fact that this fall 208,000 Newfoundlanders and Labradorians

were employed. That is an employment level not reached in this Province in many years.

SOME HON. MEMBERS: Hear, hear!

MR. EFFORD: Mr. Speaker, figures for fish landings for the first

ten months are not yet available. However, I am pleased to report that for the January to

September period this year, approximately 206,600 tons of fish were landed, having a

landed value of close to $320 million. Add the landed value of seals to that and the total

landed value exceeded $331 million.

What is significant is that the landings for the first nine months this

year were up substantially by 48,000 tons over the same period in 1997.

SOME HON. MEMBERS: Hear, hear!

MR. EFFORD: That is an increase of 30 per cent. The landed value

increased by $83 million - or 35 per cent - for the same period. The increases reflect a

10,000 ton increase in landings and $22 million in landed value of snow crab. Most

noteworthy is the fact that the 49,000 tons of Northern shrimp landed by the inshore and

offshore sectors were more than double the landings for the same period in 1997, and the

landed value of this species jumped from $63 million to $115 million.

SOME HON. MEMBERS: Hear, hear!

MR. EFFORD: Most of these increases resulted from an approximate

20,000 ton increase in new inshore Northern shrimp fishery.

In terms of the export value of our products, preliminary figures

indicate that an estimated export value - I suggest the hon. member should listen to these

numbers - of $585 million for the first nine months of 1998 has exceeded the export for

the entire twelve months of 1997.

SOME HON. MEMBERS: Hear, hear!

MR. EFFORD: Mr. Speaker, our commercial fisheries are making a

significant contribution to our economy, particularly in rural areas where close to 25,000

people are earning a livelihood from our renewable marine resources. Not every plant is

open, not every person who would like to be working in the fishery is doing so, but what

is significant is the direction the fishery is taking. Many plant workers are working

longer periods. Better prices to fish harvesters reflect, among other things, the

implementation of new quality assurance measures. The harvesting sector is evolving as

multi-species operations. Private sectors investment in such species as shrimp is strong,

indicating the confidence the industry has in the direction the fishery is taking.

All these factors are creating a more stable and viable fishing

industry that will be even stronger as work continues to diversify the industry and

develop new fisheries and underutilized species. These development initiatives, combined

with a sound quality assurance program and market development strategies, will ensure that

our fishery will continue as a strong indicator of solid economic and employment growth in

this Province.

Furthermore, I am working with my colleague the Minister of Development

and Rural Renewal to develop a policy to utilize what is now a waste product in crab and

shrimp shells as well as fish offal. This policy will mean total utilization of all our

fish products and will increase the landed and export values of our fisheries, and create

even more employment opportunities.

Thank you, Mr. Speaker.

SOME HON. MEMBERS: Hear, hear!

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

MR. FITZGERALD: Mr. Speaker, thank the Lord for divine

intervention.

There is no doubt there is good news in the fishery. There is no doubt

that we are seeing the export value of our fish products, I think, close to $600 million,

the minister has stated, this year. The reason for that is because with most of our

exports this year and in recent years we are shipping and exporting much higher value

products. As much good news as the minister reads, and he does admit it, the sad part

about it is that we are not seeing the numbers employed in the fishery as we did before.

Hopefully that will change.

I witnessed some good news in my district again just a couple of

Fridays ago when the minister and the Leader of the Opposition went down to my district,

and we witnessed the opening of a new shrimp plant. Fishery Products International spent

in excess of $11 million on a plant that just a few short months ago the CEO was trying to

sell for one dollar. I said: Mr. Young, is it still available for one dollar? He said: You

give me $16 million and one dollar and you can have it. That is the change of attitude and

that is what is happening.

The minister now has to start focusing his attention on some other

things. He has to start focusing his attention on what the fishery of the future will be

like. There are a lot of questions left unanswered out there. He has to focus his

attention and convince his federal cousins up in Ottawa to have a commercial cod fishery,

a commercial inshore fishery again, in areas like 3PS and on the northeast coast where the

index fishery and the 20,000 ton allocation in 3PS showed that it can sustain a commercial

fishery.

The minister has to do more than write letters to his federal

counterpart to allow fishermen to go out and buy bigger boats so that they might be able

to fish in some degree of comfort, and be able to go out with some degree of safety. The

minister lost control. He lost control of the Fisheries Loan Board when he put it in the

hands of the Minister of Development and Rural Renewal. He lost control and made the

fishermen of this Province slaves to the merchants again. That is what he has allowed to

do. If the minister was strong and vigilant he would have demanded that the Fisheries Loan

Board, while it would be changed, would forever rest in his department -

MR. SPEAKER: Order, please!

The hon. member's time is up.

SOME HON. MEMBERS: By leave!

MR. FITZGERALD: - so he could control what was happening in that

particular industry.

MR. SPEAKER: Order, please!

The hon. member's time is up.

MR. FITZGERALD: While the minister stands and pats himself on the

back, and I share his joy, there are still lots of problems in this industry.

MR. SPEAKER: Order, please!

The hon. member's time is up.

SOME HON. MEMBERS: Hear, hear!

AN HON. MEMBER: (Inaudible).

MR. SPEAKER: Order, please!

The hon. the Premier on a point of order.

PREMIER TOBIN: Mr. Speaker, I just want to point out, having heard

the member just speak, that for myself a moment ago, having heard the Minister of

Fisheries and Aquaculture, I nearly jumped up, I was so moved by his stewardship, and

resign my position and turn it all over to the Minister of Fisheries and Aquaculture

because of the tremendous job he is doing for Newfoundland and Labrador!

MR. SPEAKER: Order, please! Order, please!

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: No point of order.

SOME HON. MEMBERS: (Inaudible).

MR. SPEAKER: Order, please!

The hon. the Premier on a point of order.

PREMIER TOBIN: Mr. Speaker, I want to make it clear though, I was

only tempted.

MR. SPEAKER: Order, please!

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.

It is always good to hear that the figures on the fishery are going in

a positive direction, whether it be employment, value-added, export value. I want to

caution the minister and the government. My colleagues in Ottawa in the New Democratic

Party, the fisheries critic for example was telling me the other day, that it was very

difficult to get any sympathy in Ottawa for rural Newfoundland, for out-migration, for the

fisheries. Because every time we bring up the subject we are told that the Minister of

Fisheries and Aquaculture in Newfoundland and Labrador is always talking about how

wonderful things are, and the Premier is always talking about how wonderful thing are. He

said: They do not see anything wrong, what is wrong with you? You are from Nova Scotia up

here telling us there is something wrong with rural Newfoundland because people are

leaving rural Newfoundland.

The Minister of Fisheries and Aquaculture tells us everything is great,

the Premier tells us everything is great. I say be cautious, Minister. It is nice to see

things going in the right direction, but when we have 40,000 people leaving this Province,

and we need programs to ensure the survival of rural Newfoundland, it is no good telling

Ottawa everything is rosy and hunky-dory. Because we know here that it is not. With 18 per

cent unemployment, plus 40,000 people leaving this Province in several years, we cannot go

around patting ourselves on the back too much, because we are not likely to get any

sympathy anywhere else. Thank you, Mr. Speaker.

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

Agrifoods.

MR. K. AYLWARD: Thank you, Mr. Speaker.

Forestry and silviculture have become a valuable employment alternative

for the rural economy in many areas of our Province. Forests that have been

silviculturally treated maximize the yield, survival and growth of the forest.

Twenty-one new or extended silviculture projects have recently been

approved creating 1,371 person weeks of work. An extra $600,000 of Transitional Jobs Fund

money has been negotiated with the federal government, a federally-funded program, and has

been allocated to continue the silviculture projects such as pre-commercial thinning, cone

collection and plantation maintenance.

SOME HON. MEMBERS: Hear, hear!

MR. K. AYLWARD: We are extremely pleased with the Employment

Initiatives Program for forestry related activities. Over the past year 87 agreements were

entered into. We provided employment for 704 persons, creating an estimated 8,000 weeks of

employment, with an investment of over $3 million. Related to many other employment

sectors, the employment investment ratio for silviculture is very high, as 75 per cent of

every dollar is paid out in wages.

Most silviculture is conducted in rural areas, employing rural

Newfoundlanders and Labradorians. Forests that have been silviculturally treated continue

to build equity and support the future of our rural economy.

I would like to take the time to thank the federal minister, the hon.

Pierre Pettigrew, and the hon. Fred Mifflin, our federal minister, for their continued

support for forest related initiatives through the Transitional Jobs Fund Program.

Thirty-one projects were completed to augment the long-term wood supply

for thinning 968 hectares. Roadside improvement projects treated 95 hectares, and 64

hectares were planted in the Roddickton area.

Other forestry related projects completed were wood removal, trail

construction, road maintenance, and road improvement.

The resource benefits of this work effort include an increase in forest

growth, resource growth, value of salvaged wood, and reforestation. The human resource

benefits are meaningful work and support our rural economy.

We must continue to invest in our forests. We must continue to increase

the yield of our forest products and provide meaningful employment for our rural

communities.

Mr. Speaker, to take a minute, I want to show the House of Assembly:

these are from two trees that are the same age. One was treated silviculturally with the

work that we have done over the last few years. They are the same age, and the difference

in the growth is amazing. That is the kind of thing we have to keep doing, and we look

forward to working with the federal government on this.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The hon. the Member for Baie Verte.

MR. SHELLEY: I wonder what the minister is using for fertilizer,

Mr. Speaker.

Mr. Speaker, I thank the minister for his statement. I just got it as I

came into the House of Assembly. There is no doubt, when we talk about silviculture, what

it can do. That is evidenced as he has shown us today in his example here, and we

encourage it. The only thing we would add to that is to say more.

Of course, it is something that is for the long term. It is something,

especially as the minister pointed out, in rural Newfoundland; a lot of those jobs were

created in that area. It is well needed, believe me. As every day goes by in rural

Newfoundland and Labrador, that is needed more and more.

Also, the minister knows that besides silviculture, the current

harvesting practice of today is something that also has to be looked at, when we look at

the harvesters and the way trees are harvested today in Newfoundland and Labrador. We have

some problems there that have to be addressed. It is fine to say we are going to work on

silviculture, but at the same time we have to look at our current harvesting practices to

ensure that we have a long-term industry in the forest industry, and also that we look at

value-added in the forestry the same as in the fishery.

The plant that is about to start out in my area, as the minister knows,

that is the type of thing we need in this Province.

MR. SPEAKER: Order, please!

The hon. member's time is up.

MR. SHELLEY: The only thing we can say to silviculture is to keep

increasing on silviculture, Mr. Speaker.

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

SOME HON. MEMBERS: Hear, hear!

MR. TULK: Mr. Speaker, earlier this week I had the pleasure of

proclaiming this week as the first annual Crafts Week. I would invite all members of this

House to join me in acknowledging and celebrating the important contribution the craft

industry is making to the economy of our Province.

The Newfoundland and Labrador craft industry is very diverse,

consisting of self-employed enterprises to small-scale niche manufacturing companies, most

of which are based in rural areas of the Province. In the past ten years, the craft

industry has grown five fold to its present annual value of more than $25 million, of

which $4 million is in export value.

The Department of Development and Rural Renewal, in partnership with

the Newfoundland and Labrador Craft Development Association, supports the industry through

a variety of programs, all of which are aimed at strengthening and growing individual

craft producers. Particular attention is being given to enhancing the marketing

capabilities of producers and exposing them to new market opportunities nationally and

internationally. Increased sales at home and abroad lead directly to new jobs, and

producers in this Province have proven they can compete with the very best. This year

alone saw several producers win national trade show competitions for the quality,

distinctiveness and market acceptance of their products.

Mr. Speaker, I am also pleased to inform the House today that the

Province will be the official host of the annual Atlantic Craft Trade Show in February of

next year. This will be a significant opportunity to showcase the many talents of our

producers. This is the only wholesale craft trade show in Canada and is managed as a

partnership among the four Atlantic Provinces. Newfoundland and Labrador will be well

represented at this event. Over thirty local producers are expected to present their

products to more than 2,000 buyers from all around the world. Trade shows such as these

have assisted Newfoundland and Labrador craft producers secure markets as far away as

Germany and Japan.

Mr. Speaker, I would also like to draw members' attention to the annual

Christmas Craft Fair sponsored by the Newfoundland and Labrador Craft Development

Association, which will open tomorrow, Thursday, at Memorial Stadium in St. John's. You

will see there many of the fine crafts, apparel and giftware that are earning the

Newfoundland and Labrador craft industry a national and international reputation for

excellence. Better still, I urge all members to purchase locally made crafts as gifts for

the holiday season. You will be supporting the local industry and demonstrating your

impeccable taste at the same time.

I would ask all members to join with me in celebrating the success of

this vibrant and growing industry in Newfoundland and Labrador.

Thank you, Mr. Speaker.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The hon. the Member for Baie Verte.

MR. SHELLEY: Thank you very much, Mr. Speaker.

There is no doubt that everybody in this House of Assembly supports the

craft industry. People in all parts of rural Newfoundland - as a matter of fact, in my own

district there is a person who works with crafts who is using the Internet now to sell

those particular crafts, and is getting orders from all over the world. It certainly is a

growing industry. People in this part of the Province have a chance to express their

culture through these crafts and so on.

Another thing that has been mentioned to me by people in the crafts

industry is how Sunday shopping has affected the craft industry. Maybe that point should

be raised again to assess how that effects the craft industry. It has a negative impact,

no doubt about it.

We all support the craft industry, and we hope that it flourishes and

grows. Hopefully it will give some much needed employment to some rural parts of

Newfoundland which take this industry very seriously.

Thank you, Mr. Speaker.

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

he have leave?

AN HON. MEMBER: By leave.

MR. SPEAKER: By leave.

MR. HARRIS: Thank you, Mr. Speaker.

I am pleased that the government has declared a proclamation of Crafts

Week for the first time. Crafts are important in a number of respects. They provide

opportunities for rural Newfoundlanders, but they also provide opportunities for artistic

expression. Many of our crafts are now not merely crafts or home crafts; they are in fact

works of art that are displayed at the Devon House Craft Gallery in my district here in

St. John's. They are recognized as a significant artistic contribution to our culture and

to the enjoyment of material goods by people.

We also have in my district the Anna Templeton Centre. Unfortunately we

did not see strong enough government support to continue it full-fledged as a craft

centre.

MR. SPEAKER: Order, please!

The hon. member's time is up.

MR. HARRIS: There was insufficient support from government on that

level.

We do believe that crafts have a lot to offer people, and I would like

to encourage all members to visit the Devon House Craft Gallery, to visit the craft fairs,

and to make full use of these as Christmas gifts.

MR. SPEAKER: Order, please!

The hon. member's time is up.

Oral Questions

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

SOME HON. MEMBERS: Hear, hear!

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

Since bringing down its Budget this spring, the government has made

several major decisions with significant impact on the Province's fiscal position. The

Minister of Finance's statement on Monday could be called many things: a short story, an

essay, maybe a tall tale. One thing it was not was a financial statement; that is for

sure. Financial statements, I think everybody would agree, normally and generally contain

numbers. This did not.

In view of the fact that the minister would not ask the questions, I

would like to ask the Premier today: With respect to the Contingency Fund, you made a

commitment in the House that the Contingency Fund was put in place in the Budget to act as

a cushion in case of emergencies that arose, and some have. Obviously it has been spent.

Can you tell the House today what the Contingency Fund of $30 million was spent on? When

was it spent, and what was it spent on?

MR. SPEAKER: The hon. the Premier.

PREMIER TOBIN: Mr. Speaker, I would have to await the return of the

Minister of Finance to give you detailed accounting. If the Leader of the Opposition wants

to have a detailed accounting of every expenditure of the government in a budget of 3.5

billion, he ought to give us a little notice and we would be glad to give him that

accounting.

The fact of the matter is that we are not fully through the year and I

am not sure - in fact, I am fairly sure at this stage of the game that the government is

not running in a deficit position. We are still, Mr. Speaker, well within budget. The

question is whether or not by the end of the fiscal year we are able to hit a $10 million

deficit target, or whether we are going to have a larger deficit than that which has been

forecast.

The minister has already said that he assumes that with the decline of

world economic growth being forecast to go from 3.1 per cent - he said this in his

statement - down to 2 per cent, with the economies of Canada, the United States, Europe,

and every province of Canada adjusting their expectations, that it is reasonable to assume

that Newfoundland and Labrador will not exist in a bubble and be totally insulated from

what is going on in the rest of the world. Therefore there will have to be some adjustment

in our Budget Estimates as well.

Mr. Speaker, to stand today, when we are partway through the fiscal

year, and ask for an accounting of all expenditures before all expenditures have occurred

including, by the way, using up all of the contingency fund, demonstrates quite frankly

that the Leader of the Opposition simply does not understand the way in which the finances

of the Province work.

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

Opposition.

MR. E. BYRNE: We will see, Premier, whose definition works or does

not work in a few moments. I asked the Premier these questions because the Minister of

Finance and Treasury Board obviously chose not to answer them. He chose not to be

accountable to the people of the Province. We will get to that in a second.

I would like to ask the Premier this. Since the spring Budget and the

close of the House of Assembly, the government reached an agreement with respect to the

troubles and the unfunded liability portion of the teachers' pension plan. Could the

Premier tell us today what, if any, impact that decision had on current account? In other

words, what will be the cost of that agreement on this year's finances?

MR. SPEAKER: The hon. the Premier.

PREMIER TOBIN: Mr. Speaker, the Leader of the Opposition is really

taking us through an amusing series of questions, the answers to which - most of which -

he already knows.

On the question of the unfunded pension liability, that does not have a

significant impact on this year's current Budget Estimates. He knows that. I do not know

why he is asking the question.

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

Opposition.

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

The Premier has indicated that it would not have a significant impact.

Again, that is not the question I asked. I asked: What was the impact financially?

Let me ask him another question. Since the spring Budget, the

government reached a collective agreement with respect to the Newfoundland and Labrador

Medical Association. What, if any, impact did that agreement have, in financial terms, on

this year's finances that was not budgeted in the statement?

MR. SPEAKER: The hon. the Premier.

PREMIER TOBIN: Mr. Speaker, we can spend all of question period

with the Leader of the Opposition in a desperate attempt to portray something even

resembling intelligence in the area of financial statements, asking questions one at a

time.

The answer to the question of the impact on the settlement with the

Newfoundland and Labrador Medical Association is $32 million, I believe, out of the budget

of the Department of Health and Community Services. That is money that was provided for in

the Budget Estimates of the Department of Health and Community Services. I do not know

what the Leader of the Opposition is getting at.

I can say this. I believe what the Leader of the Opposition is doing,

quite frankly, is irresponsible. The Leader of the Opposition spent Monday in the House

criticizing the decision of the Government of Newfoundland and Labrador not to spend $170

million to close the gap on IOCC, and he wants to spend Wednesday saying that although

Monday he thought we had $170 million to throw away, that Wednesday there is a crisis.

Mr. Speaker, I will tell him something. The retail trade of this

Province who are counting on the Christmas season, and the employees of this Province,

including the 30,000-plus public servants, do not want somebody falsely raising a claim of

crisis when there is no crisis, no matter how many little questions you ask.

SOME HON. MEMBERS: Hear, hear!

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

Opposition.

MR. E. BYRNE: It is obvious that the government is on spin cycle as

opposed to the work cycle, is all I can say, Mr. Speaker. No one is creating the crisis.

Maybe the Premier is not aware that his own Minister of Finance and Treasury Board said

five weeks ago, that it could be $85 million. A couple of days before that he said it

could be $55 million.

All we are asking for is accountability, Premier. I want to ask you

this. Surely, Cabinet has been briefed on the mid-year financial statements as they

normally are each and every year. What has been the impact of the out-migration this year

on this year's Budget Estimates?

MR. SPEAKER: The hon. the Premier.

PREMIER TOBIN: Mr. Speaker, let every single public servant in the

Province, 30,000-plus, many of whom have negotiated three-year collective agreements with

the government in good faith, let all of the retail trade of this Province who at this

time of the year are getting ready for what is their most important season, let them all

take note of a line of questions which has been answered over and over, designed to create

a feeling of unease, a feeling of insecurity, an expectation of layoffs or cutbacks, an

expectation of an economy in free-fall, of a financial position out of control, all

designed to create crisis; and that the Leader of the Opposition, who says he wants some

day to be premier of this Province, is prepared to play that kind of game because he wants

a headline, even if in the process he puts at risk the small business community of this

Province and causes fear and concern in the 30,000 public servants of Newfoundland and

Labrador.

Mr. Speaker, the Leader of the Opposition a few weeks ago was telling

the world that Newfoundland and Labrador might run a $150 million deficit this year. That

is absolutely false. I would say to the Leader of the Opposition that if he wants to be

leader of a government, grow up.

SOME HON. MEMBERS: Hear, hear!

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

Opposition.

MR. E. BYRNE: (Inaudible) the Premier of the Province wants to

continue to be Premier, it is time for you and your government to start to be accountable,

Premier. That is the purpose of these exercises.

SOME HON. MEMBERS: Hear, hear!

MR. E. BYRNE: Let me say this to the Premier. It is obvious to me

that this Premier's definition of accountability is different from the former premier's

definition of accountability. Because the same Minister of Finance and Treasury Board

three years ago rose in his place, November 3, 1995, and updated the Province on the

financial situation. He said:

"During the first half of the fiscal year several developments

have occurred which have caused our fiscal position to deteriorate by approximately $60

million. Our net expenditures have increased by approximately $15 million while our

estimated current account revenues declined by about $45 million."

The reality is that the same minister three years ago could stand in

his place and be accountable to the people of the Province. The question remains, Premier:

Why could he not do it this year?

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The hon. the Premier.

PREMIER TOBIN: Mr. Speaker, I am tempted to say that if you want to

compare leaders and former leaders, I knew the former leader and believe me, you are no

`Loyola.' He knew where he stood on all the major issues.

SOME HON. MEMBERS: Hear, hear!

PREMIER TOBIN: Mr. Speaker, on education reform he would tell you

where he stood, even when it was not easy to tell you where he stood.

SOME HON. MEMBERS: Hear, hear!

PREMIER TOBIN: The referendum has been over for nearly two years

and we still do not know where the current leader stood. He is still hiding.

AN HON. MEMBER: (Inaudible).

PREMIER TOBIN: Yes, it is true, Leader of the Opposition, yes

indeed. We do not know where you stand on Churchill Falls, and we are not going to find

out. We only know where you stand when there is a parade and you can sniff your way to the

front of the parade.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: Order, please!

PREMIER TOBIN: Hustle, Mr. Speaker, like an anxious crab crawling

across the beach trying to get in front of the parade.

MR. SPEAKER: Order, please!

PREMIER TOBIN: Mr. Speaker, the Leader of the Opposition, if he

were serious, and if he expected me to respond seriously to these questions, would know

that the Province's finances are very much impacted by the adjustments and readjustments

and re-estimates of federal payments under the transfer program. I know that the Leader of

the Opposition has raised publicly the impact of population on transfers, and that is

true, that is a factor.

Tax rates. The performance of our economy verses the national average

is a very big factor. He would also know that the last re-estimates for the year come in

February. Shortly after that we get a federal budget. It is impossible and would be

misleading for the Minister of Finance and Treasury Board to stand and tell you this year

what his numbers are going to be in advance of knowing what the last federal re-estimates

are in that regard. I think what is important is this.

MR. SPEAKER: Order, please!

PREMIER TOBIN: We have go a Minister of Finance and Treasury Board

who has credibility in the business community, in the international financial community

MR. SPEAKER: Order, please!

PREMIER TOBIN: - who has done a tremendous job, and tells us not to

worry -

MR. SPEAKER: I ask the hon. the Premier to conclude his answer.

PREMIER TOBIN: - we are in solid control of the finances of the

Province.

MR. SPEAKER: The hon. the Member for Baie Verte.

MR. SHELLEY: Thank you very much, Mr. Speaker. I have some question

today for the Minister of Mines and Energy.

Of course there have been many questions already raised about the

situation at IOC in Labrador City, and there is going to continue to be more questions as

long as some of the answers from the minister and from the Premier -

AN HON. MEMBER: Ask the question, (inaudible).

MR. SHELLEY: I will ask the question when I am ready, I say to the

minister. This is going to be a straight question, Mr. Speaker. Yesterday the minister

said that somewhere between, on average, over the years, it depends on $20 million to $25

million in royalties from IOC. On an average per year. I want to know if the minister

stands by those numbers when in fact this year's estimate was $29 million for the entire

royalty regime in revenues to this Province. Are you telling me that between $20 million

and $25 million of that $29 million comes from IOC? Is that right?

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

MR. FUREY: Mr. Speaker, that is accurate. What I said was that the

Leader of the Opposition asked me the average revenues coming from IOC, which is measured

5 per cent against net profits. So it is fluid; it changes each year depending upon the

profitability of the company.

With respect to the royalty fund, it is 20 per cent of the Iron Ore

royalty fund. On average it is somewhere in the order of $30 million a year, including

corporate income tax, including fuel tax, including payroll tax. On average it is $30

million a year.

What was the other half of the member's question, Sir?

MR. SPEAKER: The hon. the Member for Baie Verte.

MR. SHELLEY: The corporate taxes, Mr. Speaker... I would like for

the minister to just explain straight up, and we will ask today that it be tabled in this

House, the royalties alone from IOC from last year. Would he table those royalties in this

House for last year?

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

MR. FUREY: For last year? Yes, I will be happy to get the

royalties, specifically for the last ten years if he would like.

MR. SPEAKER: A supplementary, the hon. the Member for Baie Verte.

MR. SHELLEY: Just one more question for today. Once I get the

tabling of the royalties for tomorrow, hopefully, or soon -

AN HON. MEMBER: (Inaudible).

MR. SHELLEY: Mr. Speaker, I have one question left for today. In

the eighteen months -

SOME HON. MEMBERS: Oh, oh!

MR. SPEAKER: Order, please!

The Chair has recognized the hon. the Member for Baie Verte.

MR. SHELLEY: One last question for the day, because I will wait to

see the tabling of the royalties in the House.

I want to ask the minister: In the eighteen months leading up to this

final decision, and all the talks and negotiations and discussions, was the royalty regime

ever discussed in these negotiations?

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

MR. FUREY: Mr. Speaker, the hon. member was not here yesterday,

obviously, but the Leader of the Opposition asked that very question and I answered it,

and from the very Hansard that he is reading from. Look at the next paragraph and he will

see the answer. If he can't read it, the member from Torbay or St. John's East probably

will read it for him.

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.

Minister, there has been a movement to centralize services on Fogo

Island for some time, and I might add it has been supported by the government of the day.

In fact, the Minister of Municipal and Provincial Affairs just spoke, I think, at a

municipalities' federation and indicated the importance of centralization.

On Fogo Island now, the centre of the Island contains the schools, the

co-op, the police, and the regional council office. It has the stadium, the library, and

the Works, Services and Transportation offices. They have all been moved in a

centralization process.

Clearly, the central location on Fogo Island is rapidly becoming the

service growth centre of the Island; and it is happening, Minister, because it is fair. It

is the sensible choice, and it is accessible to all the residents of the Island. It is

closer to the airstrip and to the ferry terminal.

I want to ask the minister: Why now, Minister, are you throwing the

centralized planning to the wind and allowing a new hospital to be built in an area that

is further removed from 75 per cent of its population?

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

Services.

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

If the member across the way had done his research, he would have known

that there have been two reports done about site location for a new facility in Fogo

Island. The most recent report, which was done by an outside consultant - which all

parties agreed they would accept the recommendation - that outside consultant group made a

recommendation that this particular facility would go to the centre - not to the centre of

the Island, but rather to the Town of Fogo.

The board received that recommendation, they accepted that

recommendation, and they wrote and asked me to concur with that recommendation, which I

did, Mr. Speaker.

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

Opposition.

MR. SULLIVAN: Thank you, Mr. Speaker.

Minister, the people representing the concerned citizens of Fogo Island

have written you, and sent a copy to the Premier, and they are becoming disillusioned with

your lack of response to it, I say to the minister.

Yesterday, I received a copy and it is very disturbing. It was signed

by over 100 fishermen on Fogo Island, saying that they are going to refuse to sell their

product to be processed in Fogo. So what is happening on Fogo Island, Minister?

That is very serious. We are pitting resident against resident,

community against community, I say to the minister, because we have a consultant's report

that is flawed and biased.

MR. SPEAKER: Order, please!

The hon. member is on a supplementary; I ask him to get to his

question.

MR. SULLIVAN: I ask the minister: Will she do what is right? Will

she take the necessary action and listen to the people in their legitimate fight to have

the hospital at the central Island location?

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The hon. the Premier.

PREMIER TOBIN: Mr. Speaker, I rise only because the member who has

just spoken, the Member for Ferryland, has just introduced as an example of the level of

frustration that people are feeling, this notion that some fishermen - this is the reason

I rise - and other businesses are going to begin to boycott each other on Fogo Island.

Mr. Speaker, I think it is very important for everybody in the House to

be aware that there is a difficult and sensitive - I would ask the member just to give me

a moment - conflict between communities on Fogo Island. There is no question about that. I

think there is no question equally that we need to find a process to facilitate a

dialogue. I should say to you that the Member for Fogo Island has been in to see me to

discuss this, together with the Minister of Health, to raise the serious differences that

exist on the Island itself, and the fact that those differences have spilled over into

other areas of economic activity.

I would hope, knowing the member opposite, that no member of this

House, including the member who just spoke, certainly nobody on this side, would ever

suggest that the way to bring about resolution of a conflict between communities - and it

sometimes occurs in rural Newfoundland - is, in any way, shape, or form, to validate or

give credence or credibility to actions where one community would boycott another. Because

that would give rise on a whole range of issues to a series of actions which quite frankly

would be counterproductive to life in rural Newfoundland. I would ask the member to be at

least clear with regard to that issue.

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

MR. SULLIVAN: Thank you, Mr. Speaker.

No, in fact I am very concerned about that. The minister appointed a

board in this Province with responsibility for health care, to serve the people. I find

problems in a report that does not address the concerns and put proper weight in this

report to issues of importance.

I will ask the minister one question on this flawed report that I call

it: Do you think it is fair, or is there something wrong, when a consultant puts more

points to the views of a few medical people - three or four - as opposed to 3,500? There

is a spread of forty-two points by the opinion of a few medical people, and the whole

population of the Island only has, say, a credit towards forty points. We are asking three

or four people, and they are given more weight in this report. That direction had to come

from somebody. They had to sit down; they did not consult.

It is flawed, Minister, and you know it. I have gone through it and

discussed it. It has nothing to do with the politics of the situation.

MR. SPEAKER: Order, please!

I ask the hon. member to get to his question.

MR. SULLIVAN: I ask the minister now: Will she admit that there are

flaws in this report, it is not based on fact, that there is a false premise here, and go

get somebody locally to look at it, who understands the area and the issues here, not some

New Brunswick company to come in and tell everybody in a particular area what they should

do and what is best for them?

SOME HON. MEMBERS: Hear, hear!

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

Services.

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

In response to your warm-up before the question, I would like to make a

few comments.

AN HON. MEMBER: (Inaudible).

MR. SPEAKER: Order, please!

MS J.M. AYLWARD: First of all, in response to the

preamble, I would

like to make some points to clarify some of the information that has been put forward.

If the member opposite had any knowledge of the type of issues around

the decision-making here, he would clearly understand why an outside group was chosen to

make this decision, because of the ongoing issues around those kinds of things; for

example, the site of the facility.

Second of all, I find it appalling that he would think that the

medical, the physicians', views would not be important when every other day in the House

he is standing up talking about the whole issue around physician and physician

recruitment.

Yes, that was certainly a very valid point that was raised in this

report, along with a whole lot of other issues in that particular report. Cost was also a

factor, location, firefighting services, and a whole range of other issues were also

rated.

Second of all, I think it is important to state that this is the second

time an independent report has been done and the same decision has been reached: that a

location for a new facility should be in the Town of Fogo.

I think most importantly I want to say again that the Member for

Twillingate has been actively working with us on this issue. He has expressed concern over

the level of anger and hostility that has been shown - and frustration - by all residents

on the Island.

As a matter of fact, we have appointed a mediator to go to the Island

to work with the people, to try to help them resolve their differences and outstanding

issues on this very important matter. We take this very seriously. We see the whole income

and impact of the Island being affected, and that is why we have moved in this direction

to appoint a mediator to go to and help the various towns resolve their outstanding

issues.

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

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

Minister of Justice and Attorney General for the Province.

Could the Minister of Justice please tell the people of the Province

how much of their money was paid out recently in the Atlantic Leasing case?

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

MR. DECKER: Mr. Speaker, the hon. member knows that he has written

the Department of Finance and asked for this figure. He has also been told that when the

money was paid out there was a non-disclosure clause which was put in at the request of

the company.

We have an obligation to the company to advise them -

AN HON. MEMBER: (Inaudible) taxpayers.

MR. DECKER: Yes, we have an obligation to the taxpayers and

eventually the number will become public, no doubt. However, the hon. member knows that

when he wrote under the Freedom of Information there is a process which must be taken.

The Department of Finance has written to the company's council and

advised them that we have received this request, and we are awaiting a reply from the

company. We do not want to do anything which would in any way jeopardize the ongoing

business of that company. We want to make sure that we strike a balance between the rights

of the company and the rights of the taxpayer. There is no desire by government to cover

up the amount. I would be quite pleased to make it public as soon as we hear from the

company and we hear what they have to say. We have to be reasonable in this whole affair.

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

East.

MR. OTTENHEIMER: Tell the Minister of Justice how it is done, Mr.

Speaker. He has one of his lawyers from the Department of Justice prepare an application

for court. He and the lawyer for the other side attend upon the judge's chambers. That can

be done tomorrow. A proceeding can be put down in Applications Court, in the Trial

Division, the very next morning. Both lawyers can appear and we can have this matter

resolved.

MR. SPEAKER: Order, please!

The hon. member is on a supplementary; I ask him to get to his

question.

MR. OTTENHEIMER: There is absolutely no justification for what this

minister has done on behalf of the government of the Province (inaudible) with the

people's money.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: Order, please!

I ask the hon. member to get to his question; he is on a supplementary.

MR. OTTENHEIMER: This government is entrusted with trust. The

people of this Province require that this government uphold the trust at all times.

MR. SPEAKER: Order, please!

I ask the hon. member to get to his question.

MR. OTTENHEIMER: It is not being done. What possible justification,

I say to the minister, could there be? What possible rationale could exist, that this

government could enter into a gag order or any sort of non-disclosure agreement which

hides from the people of this Province the very money that this government is responsible

for?

SOME HON. MEMBERS: Hear, hear!

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

MR. DECKER: Mr. Speaker, this government does not have to take

direction from the hon. member as to how to govern and take into consideration the rights

of the taxpayers to have knowledge. We acknowledge that. We also have to take into

consideration the rights of a company to have this number made public at the appropriate

time. We do not want to do anything which would jeopardize a private company in this

Province.

Remember, Mr. Speaker, the hon. member is getting up and complaining

because we do not make the number public. I suspect if we did make that number public at

the wrong time, and we did hold ourselves up for another lawsuit, the hon. gentleman would

be the first one over there accusing us of opening up the Province for another lawsuit and

probably pay out some more money.

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

East.

MR. OTTENHEIMER: Thank you, Mr. Speaker.

I think the minister fails to realize that in both the Trial Division

decision and the Court of Appeal decision, the government, the Administrators of the day,

were found to be negligent. In fact, the last line in the decision of the Court of Appeal

states: Such administrative intransigents can - and in this case does - constitute

negligence.

Let me ask the Premier: Is he comfortable today in knowing that around

him are the very ministers who sat several years ago at the time when the basis for these

decisions was in fact founded? Is he comfortable in knowing, and will he now hold his

ministers accountable for negligence as has been established and found by the senior court

of this Province?

MR. SPEAKER: The hon. the Premier.

PREMIER TOBIN: Mr. Speaker, when I look at where I am sitting, and

compare myself to where the member is sitting, I am extremely comfortable - and the people

who are around me.

When you get these kinds of questions that want to go back in time, I

can only borrow a phrase from the hon. John Crosbie, who would say that the member

opposite looks like he was weaned on a pickle, and the pickle was grown by Sprung

cucumbers.

SOME HON. MEMBERS: Oh, oh!

MR. SPEAKER: Order, please!

The hon. the Member for Signal Hill - Quidi Vidi.

MR. HARRIS: Thank you, Mr. Speaker. My question for the Minister of

Mines and Energy concerns a question that I raised on a petition yesterday.

The government, in responding to the Chamber of Commerce in Labrador

West on a question as to what benefit the construction jobs would have in Labrador, the

Minister wrote, and I quote: Based on 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. Speaker, we are talking here about 1,150 person years of

employment, and the government's attitude appears to be there is no direct gain in the

Province as a result of this project. What kind of an analysis is that, and what kind of

attitude does this government have to the necessity of this kind of job with the

employment opportunity in the Province of Newfoundland?

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

MR. FUREY: Mr. Speaker, in typical lawyer fashion, the hon. member

has taken one sentence from a very long letter and twisted it completely out of shape. Let

me read the full sentence. Based on a preliminary analysis of this aspect - what aspect?

The aspect of applying the net gains to the treasury back against the capital cost to the

company. Would there be any net gain?

When you look at the capital cost, and recognize that there are capital

allowances which even it out, there really is no net gain. Of course the construction jobs

are important to the Province, but the question he is asking is the analysis of this

aspect - what aspect? - the aspect of the net gains to the treasury against the capital

cost for the company.

Do not twist it out of shape or put up a specious argument; be honest

with the letter and the facts that are in the letter.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: A supplementary, the hon. the Member for Signal Hill -

Quidi Vidi.

MR. HARRIS: Mr. Speaker, if that is the minister's explanation,

that we are only taking about the capital cost of the project verses the income tax that

the construction workers would pay, let me ask him this: What does he have to say about

the income tax that is going to be paid by the workers who are building that project in

Quebec and not in Newfoundland and Labrador? Is that capital cost going to be deducted

from the income tax that this company pays in Newfoundland, or deducted from their profit

next year and result in fewer royalties? Or is it going to have an extremely negative

impact on this Province's position because we are now, in fact, subsidising jobs down in

Sept-Iles?

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

MR. FUREY: The answer is no, Mr. Speaker. If the capital project

had proceeded on the Labrador side, roughly on personal income taxes it would be about $5

million. That $5 million can go nowhere to closing the gap of $250 million. The hon.

member knows that.

MR. SPEAKER: The time for Oral Questions has elapsed.

Presenting Reports by

Standing and Special Committees

MR. SPEAKER: The hon. the Minister of Works, Services and

Transportation.

MR. MATTHEWS: Thank you, Mr. Speaker.

Pursuant to statutory requirement, I am pleased to table for the House

the reports of exemptions under the Public Tender Exemptions Act for the months of May,

June, July, August and September, and October will be along shortly.

Petitions

MR. SPEAKER: The hon. the Member for Baie Verte.

MR. SHELLEY: Thank you very much, Mr. Speaker. I rise today to

present another petition from the Labrador West area.

WHEREAS 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.

Mr. Speaker, this debate started some time back. A lot of people from

Labrador West were here over the last few days to listen to the debate in the House, and

they were not very impressed because this very argument - before we get into details of

expenditures and viability and the expansion of IOC - goes to the very root of the problem

that we have seen in this Province year after year, and that is the resources of

Newfoundland and Labrador going out to benefit other Provinces, and we still see it

continue as we head into the new millennium. The people of Labrador West are finally at a

threshold where they are saying that enough is enough, it has to be stopped, and it has to

be stopped right now.

What they cannot understand is how inconsistent the government can be,

looking on one hand at the extreme of Voisey's Bay, and how tough they were there, and

then looking at IOC in Labrador City and the history they have had.

They believe that after thirty-eight years of mining in Labrador West,

of a resource that they say still has maybe 100 years' reserve left, that IOC is going to

continue to mine in Labrador West. It is not new. It is not like Voisey's Bay, and Inco

coming in and taking over. They believe their argument is sounder; that because this

company has had such a long history and made billions - we do not have the exact numbers

but it is safe enough to say that the Iron Ore Company of Canada had made billions of

dollars over the thirty-eight years that it has mined there... The good news is that they

want to expand, and everybody is glad. They looked at the markets and the demand is there

so they want to expand. The bad news is that they want to expand and the resource go

outside of Labrador West.

The way they talked about it, in the three days I spent in Labrador

West, is that they believe that this company should not even have the face, the gall, to

even consider - after the years they have been there and the money they have made over the

years - expanding outside of Labrador West.

They did not want to get into numbers and specifics on viability and

how big the expansion was. They wanted to say that this company and the new takeover by

North, after years there, the history of the Iron Ore Company of Canada in Labrador West,

if they are going to expand, it is a insult to them and an insult to every Newfoundlander

and Labradorian to believe that they want to expand outside this Province.

They did not like it very much, either - I will add to that - that the

Premier of Quebec - some people watched the debate last night and you could still see him

gloat to the fact that resources coming from Labrador West are going to put 200 to 300

people to work down in Seven Islands, Quebec. That is what they do not like.

It is driven so far now, and it is in people's minds right across this

Province, that again we are going to see our resource go out. They say this is the same

Premier - we said it here yesterday - who would take on Estai , the same Premier who

stood up to the Inco, the giant nickel producer of the world. He could all of those, and

there was nothing normal about how he took on those big factors.

MR. SPEAKER: Order, please!

I ask the hon. member to take his seat.

Private Members' Day

MR. SPEAKER: Order, please!

It is now 3:00 p.m. and it is Private Members' Day. Unless the Chair is

directed otherwise, we will now go to the hon. the Leader of the Opposition.

AN HON. MEMBER: (Inaudible).

MR. SULLIVAN: The Goulds' bypass road worked.

MR. E. BYRNE: That is right. The hydro petition worked. The Goulds'

bypass road worked. Now that we (inaudible) that early, who knows? Jack's petition

yesterday on the school, and your very flattering comments - going to let him announce it

- that obviously worked. You never know, I say to the Minister of Education.

Mr. Speaker, I rise - I think the private member's resolution speaks

for itself - to talk about a significant development in the Province in the last little

while, and that is the decision by IOCC to relocate or to expand its pellet operation in

Sept-Iles, Quebec and not in Newfoundland and Labrador, in particular Labrador West.

This is a difficult issue for everybody. I understand that. It is not

something that we come to terms with easily. It must have been a bitter pill for

government to swallow. I guess the hub of my argument has been the question of economic

viability, or economically feasible. They are the same thing really. It is our contention

that such an expansion is very viable. It is our contention that such an expansion by

North Limited could have occurred. I will get to that in a few moments as we talk about

the Hatch report and other reports.

First of all, Mr. Speaker, let me say this general remark. I was in

Labrador West for four days, myself and the critic for mines, the Member for Baie Verte.

AN HON. MEMBER: (Inaudible).

MR. E. BYRNE: Not necessarily. It depends on your point of view.

The sense of betrayal that we felt by people in the region was very

real and legitimate for the following reasons, as I see it. April 2, 1997, when North took

over IOCC's total as majority shareholder in IOCC's operation, it was clear in their own

release at the time that they indicated that part of the condition of sale was the

reactivation of the Sept-Iles plant. That was a year-and-a-half ago.

If that was the case, Mr. Speaker, obviously government was aware of

it, as we were, and obviously government took certain actions that would see that that

would not happen. I am not going to question anybody's motives here today. I don't think

that it will serve the debate whatsoever. I am not going to question the reasons why

people have taken stands because I do not think it will serve the debate, but I have to

question the decision.

Based upon questions that were asked in this Assembly last fall it was

clear that the Minister of Mines and Energy at the time indicated clearly, when asked

under direct questioning about this very decision would this happen, the answer was

clearly no. We passed a private member's resolution in the House unanimously, I believe,

generally speaking about resource developments in Newfoundland and Labrador, secondary

processing, value-added. A unanimous resolution passed in this House on a Private Members'

Day.

The people in the region - and I can only say it from this point of

view - have expressed to me, based upon the comments and the commitments made by ministers

in the Crown, that they felt that this would not happen. One individual said to me he

would have bet his life's savings, based upon what he felt were commitments by government,

that the expansion at Sept-Iles would not happen.

The Premier himself, I am told by people who were at the meeting, some

thirty or forty people who were there last year, when the concerns were raised by the

Chamber of Commerce, a meeting organized by the Chamber of Commerce, indicated to the

people and the leadership in the region that he would be the first person on the plane to

Australia where North's headquarters are located if this took place.

Nobody in this Province, and I am convinced nobody in this Legislature,

would want to see this decision happen again on any other resource. In fact, I believe it

should not have happened here. Government's contention has been this. They indicated

earlier that North had chosen a company to study the economic viability, the economic

feasibility, of expansion either in Labrador West at Carol Lake or expansion of the pellet

plant and its existing operation in Sept-Iles. It was indicated in the debates here,

certainly last fall, and it was indicated in the debates last spring.

I am led to understand from briefings by the Minister of Mines and

Energy's staff and the conversation and meeting we had with the company themselves that

last spring, when the company gave the Province its decision, showed the Province on what

basis they were basing that decision in the MetChem Bechtel report, that they said then

that they would be moving towards expanding the Sept-Iles plant.

The Province, I am led to believe, responded that they were so

flabbergasted by the numbers that they could not believe the numbers. They wanted their

own independent study done. Fair enough. The company told us - the Member for Baie Verte

was with me - that when we met with Mr. Porter and Mr. Oliver at IOCC's operation in

Labrador West, when we got into this discussion, they said that they would agree to such

an independent study only if they had some say in who was going to do it.

In other words, they did not want any company, we were told, to come in

to look at their numbers. They wanted to have, I guess, a notion that it was a credible,

reputable company. Some people have argued that the notion of independence has gone out

the window. You can argue that on both sides of the coin, but it is a moot point, as I see

it. It is a point that we can get into discussion on a little later.

The point is this. For government to get access to the company's own

records the company had to have input into who was going to do it. I am lead to believe -

again by government's own officials, by statements publicly by elected officials, minister

and otherwise, by the company - that when the Province said that Hatch was going to do the

study, the company had no problem. Nor should they have. Hatch has done a lot of work for

IOCC.

IOCC has been operating in this Province since 1938. Here is where the

roads, in terms of government's opinion and ours, start to diverge. Government entered

into a confidentially agreement with the company, on the one hand. Government then asked

Hatch to have a look at the MetChem Bechtel report. I believe what government should have

done then - and we have been asking them - was to expand the terms of reference for Hatch

to look at the total and complete operations of IOCC, factor in the expansion costs in

Carol Lake, and then determine if the expansion was viable or not. That is what I believe

government should have done. I believe that had they done it I think that what would have

been concluded is that IOCC, a subsidiary of North, is a very profitable company.

The Minister of Mines and Energy has indicated that government looked

at the study, without looking at the broader operations of IOCC, and said there is no way

we could make up the difference in the numbers. Obviously, that is true if you want to

look at it from that point of view. If you want to look at it with those narrow terms of

reference that government, in terms of Hatch, asked Hatch to do. They asked Hatch to

confirm or deny , essentially, what was in the MetChem Bechtel report. Hatch was not asked

to look at all of the operations of IOCC.

AN HON. MEMBER: (Inaudible).

MR. E. BYRNE: I guess that is the point. Mr. Speaker, government

may be able to stand from their point of view, in their own minds, and argue successfully

in favour of this private member's resolution because of the terms that I have used: terms

of jobs, secondary processing, where it is economically feasible. Because that is where, I

guess, the two roads diverge.

There have been many questions that have arisen since the decision has

been raised. For example, the concerns that the people in the region have, legitimate ones

have come to my attention, and to all of our attention I guess over time. The Minister of

Mines and Energy, I think on behalf of government, and the Premier on behalf of

government, will take the time to answer some of those. Legitimately, they are concerned

about the expansion in Sept-Iles. Who wouldn't be?

There are two lines in terms of the pelletizing operation there. People

in the region are concerned that if there is an economic downturn in the region, then who

is to say that the operation in Labrador West will not be the operation that the company

decides to shut down. That is what people in the region are afraid of. It is a legitimate

concern. I am sure that government is concerned about it. When asked directly what

commitments the company had given that this would not happen, we have not seen it. I hope

that they are there, but we have not seen it. Mr. Speaker, that is one of the concerns.

The other thing I think we need to clearly understand from the public

debate is that there is no question that at the same time while North is a profitable

company in terms of a corporation - a worldwide, global company - that IOCC as one of its

subsidiaries is very profitable. Actually it represents about 33 per cent of its net

profits. North's operation on the Rhobe River represents about another 22 per cent or 23

per cent of its net profits. It is a very profitable company for North. It is a publicly

traded company now, where it has not been since its existence. We get to see, I guess, the

numbers that we have not seen before.

There is no question that North is expanding, there is no question they

are investing in the area. A $650 million investment, we have been told, will occur in

Labrador West. While there is no mistaking that, there is no mistaking also the impact

that investment will have. Obviously the impact will be in terms of increasing

productivity. There is new technology, bigger shovels, larger locomotives, larger trucks,

and the impact of that in terms of increasing productivity will have over the next four or

five years will be a diminished workforce. A diminishment in the workforce I am told -

again, by the company and by people involved in Labrador West, with the union, with the

town council, the chamber of commerce and otherwise - that could be between, I am told,

300 and 500 individuals.

While the company and some members in the House have heralded that it

has a no layoff policy, that is true. At the same time it has a no hiring policy, which is

also true, in that through early retirements, through attrition, that the workforce will

steadily decrease over the next four to five years. These are facts that have been

presented and given to me by the company itself.

Now the company when we met with them assured - I guess everybody at

the time - of their continued investment. Their ore reserves are -

AN HON. MEMBER: (Inaudible).

MR. E. BYRNE: The company's higher cost to operate? We will get to

that in a second, if we could.

Mr. Speaker, with respect to the investment itself, $650 million,

unlike the operation and expansion in Sept-Iles, Quebec, the $350 million or $400 million

that will be the money that the company will spend in Sept-Iles, Quebec, based upon our

resource, our ore, Sept-Iles will feel the direct impact of that in terms of jobs, in

terms of construction, in terms of new jobs created.

The $650 million, the equipment it is being used to purchase in

Labrador West, we are not making the locomotives, we are not making the trucks, we are not

making the parts associated with it, we are not making the shovels. The other thing to be

understood is that probably a decade from now, if the company wants to continue to

prosecute the ore in the ground, they will probably have to make another similar

investment.

MR. SPEAKER (Penney): Order, please!

The hon. member's time is up.

MR. E. BYRNE: By leave?

AN HON. MEMBER: By leave!

MR. SPEAKER: By leave.

MR. E. BYRNE: They will probably have to make another similar

investment to continue to create profits, to continue, Mr. Speaker, to be able to take ore

from the ground.

There is been an impression I think, either rightly or wrongly, but

there has been an impression left that this company has made a $650 million investment and

that it is great news for the area. We should understand, and ground ourselves in reality,

that these are the types of investments this company has made over time since 1938, when

the leases were originally granted in the 1960s, that these are the types of investments

that it will have to continue to make to prosecute and develop that resource and add value

to it, if it wants to keep making the profits and being the profitable operation that it

is.

AN HON. MEMBER: (Inaudible).

MR. E. BYRNE: He told me yesterday he was considering it. Did you

know that your brother, at a business luncheon, actually stood and gave me a standing

ovation for my comments?

AN HON. MEMBER: (Inaudible).

MR. E. BYRNE: Did you? So you have my brother and I have yours.

I have been accused this week of some things in the House. Of not being

serious, of jumping on a parade, and all those sorts of nonsense and innuendo. We do have

a legitimate point of view, and it centres around the notion of economic feasibility.

Government believes that, and I believe that in taking one aspect of the company that you

can demonstrate it was not feasible. I cannot argue with the numbers in Hatch because they

are clear, but I can argue this, that the terms of reference for Hatch were so narrow that

it could not have proved anything else.

I believe, and I hope I am wrong, that we may have opened up a can of

worms as we define economic feasibility. What is next? A legitimate question in terms of

economic feasibility, economic viability. I am not going to make the passing references to

Inco and the double standard that people have talked about because I cannot make it,

because government has not released any information. Government has not provided to me the

information as they have in Hatch. They have not given me the information that

demonstrates clearly and soundly on what they are saying that the nickel operation at

Voisey's Bay is economically viable. They have maintained that it is.

So I cannot make the assertion that it is a flip-flop, but I do

understand people who make it, because on the surface you wonder why people are sceptical.

They have a right to be. The minister must and has to admit what appears to be so is that

there is one standard for one company and one for another. Now, he holds all the cards. He

has all the information. I am not even sure the back bench in government are aware of what

the information is that they have with respect to Inco and the numbers that Rowat has

crunched. I am sure of it.

However, it is a legitimate concern people have raised. I will say to

the minister though -

AN HON. MEMBER: What time (inaudible)?

MR. E. BYRNE: Just about five minutes.

AN HON. MEMBER: Five minutes more?

MR. E. BYRNE: Yes, that's about it. Alright?

AN HON. MEMBER: (Inaudible) fifteen minutes at the end.

MR. E. BYRNE: No, I am not going to hold up at the end. I want to

make my points now and that's it. Alright? It is a serious topic.

I want to say to the minister, in terms of the numbers on Inco, the

minister has asked me a question, and for the public record it is important. The Minister

of Mines and Energy just said: Surely you do not want us to publicly release at this time

the confidential information we have that could influence the negotiations or the possible

negotiations when they occur? No, I do not. Do not let it be said that I do. At the same

time, Minister, I think that if you can -

AN HON. MEMBER: Just give it to us.

MR. E. BYRNE: No. I think as soon as possible - there is nobody who

disagrees with that. This is for another debate, but when time is appropriate I would like

to see them. Because if not, if at some point in those numbers the economic feasibility

question tips in terms of Inco's balance or tips to the scale of Inco, then we have

ourselves one big problem. The problem is this. That by letting IOCC or North go ahead and

define economic feasibility by one aspect of their operation, then we have given them the

definition of what is acceptable by this Province. That is how I see it.

I said by not having the numbers. For example, the numbers that the

Province has on Inco. If at some point, based upon the price in the markets, the balance

in terms of what is feasible or economically feasible tips in favour of Inco and the

Voisey's Bay Nickel Company, then by what we have done with North and the allowing of what

North has done in terms of just separating out one aspect of its business, we have defined

what is acceptable to us as a legislature, and what is acceptable to the government in

terms of economic feasibility.

It is a legitimate concern. I cannot comment further on it because I do

not have the information. Government has the information. While they will not share it at

this point, and the minister has made a commitment he will share it at the appropriate

time, as soon as possible, I want to make a commitment too that if he does so I will hold

the confidence. I am not going to release it publicly, if that is the requirement. When

other public issues have come up, he is aware my commitment will be exactly what I say it

is.

With respect to the decision that government has made, I want to focus

on one last concern or issue and that is this. Some have suggested that the government had

no other legal choice, that the company could have put the expansion in Sept-Iles if it

wanted to without even consulting with government.

Let's assume for a moment that is true. Maybe it is. If that is true

then why did we go through the exercise? If that was a fait accompli upfront, if that was

the condition of sale, then why did we go ahead and create the false expectations over the

last eighteen months? Why did we go ahead and make commitments that were shallow, upon

reflection, that could not hold up to what we publicly said? Why did we bother to make

those commitments in the first place if we did not have the numbers we had now?

I think if there is anything that has angered people, it is that. If

there is anything that has angered people in Labrador West and in the Province, it is that

we have made seeming commitments but yet, at the end of the day, we could not live up to

them. The question is: Why did we create them in the first place?

If we had to wait for the numbers to come in, if we had to wait and say

we will do an independent study if it does not turn out our way, wouldn't we have been

better off in going to the leadership in the region and saying exactly that? Wouldn't we

have been better off in going to the region and saying: We have a situation on our hands

that is going to take all of us together to resolve. That did not happen, and that is why

people are angry. I understand their frustration and I understand their anger.

I will say this with respect to the royalties. We had opportunities to

change the royalties. The minister indicated yesterday that legal opinion said they could

not. We changed the Mineral Act yesterday that will come up for debate, and while we

generally support the thrust in that, generally there are issues of concern in some of

those clauses that need to be discussed, I say to the minister, because of the impact they

may have on the industry.

Generally, we can support any initiative that maximizes benefits for

the people of this Province, but I will finally say that if we could not have done it, why

did we create the expectations in the first place?

With that I am going to sit down and let members speak. I want to say

on the record as well to the Member for Labrador West that you will have noticed in all of

the debate since this decision was made that there has not been a reference to you

personally, by me or any other members on this side of the House. I want to say to you

that I understand the difficulty that you are in. It is not a situation any elected member

would want to find themselves in. While we disagree probably on the sides of the issue,

none of my comments, either here in the House or publicly, are aimed either at you

personally or question your intentions. I want to make that clear for the record as well.

I am sure in all of our political lives each and every one of us will at times face

difficult situations, whether it be if we at some point have the honour to serve in a

Cabinet, to serve in a government, as private members, or as critics, those things are

unavoidable.

I want to make clear for the public record that the focus that we

brought to this issue has been one that we believe technically could have been argued

otherwise, and had it not we believe that government could have extracted other benefits

from the company, had we had no other choice; but in no way, shape or form have they been,

are they now, or ever will be personally directed at the Member for Labrador West and I

want to make that clear.

With that I will sit down. Thank you very much.

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

MR. FUREY: Thank you, Mr. Speaker.

I just want to make one quick point before you leave. I thank the hon.

member for his concluding comments, and I do believe they are sincere with respect to

dealing with the Member for Labrador West, because he is quite right that all of us

throughout our political careers, whether they are long or short, run into some very

interesting difficulties.

The first three months after I was elected in 1985, I remember having

to deal with a crisis at Daniel's Harbour when the zinc mine was closed. It is not much

fun going in to face 400 miners and trying to understand their problems and to deal with

the difficulties and the fallout, the closure of homes and the movement of families. It is

extremely difficult.

I do thank the hon. member for pointing out that it is not a personal

thing, that it is not aimed at the member, and that he does understand and emphasize with

his situation.

AN HON. MEMBER: (Inaudible).

MR. FUREY: It is difficult, and all of us will have our problems.

The hon. member from St. John's was a very young looking member when he started a couple

of years ago and had to deal with the fallout from the dockyard, the transition it was

going to go through, and the layoff -

AN HON. MEMBER: (Inaudible)

MR. FUREY: That is right, it receded. Like the synchro-lift, it

receded backward.

We are all going to have our difficulties. Can I just say, though, that

I was looking at the resolution and I do not believe it is designed to embarrass the

Member for Labrador West. Because if you look at the recitals that are here, the exact

recitals are the exact recitals he tabled a year or so ago.

AN HON. MEMBER: (Inaudible).

MR. FUREY: Sure.

MR. E. BYRNE: The member is right in terms of the

WHEREAS

(inaudible). Again, it is not designed to embarrass the member, absolutely not.

MR. FUREY: Oh, yes. I am going to amend it.

MR. E. BYRNE: The minister would agree that the real meat of a

private member's resolution lies in BE IT THEREFORE RESOLVED.

MR. FUREY: Yes, I was going to get to that.

MR. E. BYRNE: (Inaudible) absolutely and completely different.

MR. FUREY: Mr. Speaker, I quite agree. I was just pointing out that

the recitals that are reflected in that resolution as tabled a year ago are identical to

the recitals as reflected in today's resolution that the Leader of the Opposition has put

down. That is right; the actual resolution, the conclusion to the recitals, are somewhat

different. I believe him when he says they are not aimed to embarrass the member for

Labrador City.

In fact, if you look at the second recital, he clearly points out - and

I underline it for the House - it says: Where it is economically feasible to do so.

AN HON. MEMBER: (Inaudible).

MR. FUREY: That is right, where it is economically feasible to do

so.

In the spirit of not attempting to embarrass a member, I thought I

would move an amendment so that the resolution is amended by striking out the words `to

occur in Labrador West' and substituting the words `in Labrador West when it is

economically viable to do so'.

SOME HON. MEMBERS: Oh, oh!

MR. FUREY: The new conclusion would be: THEREFORE

BE IT RESOLVED

that this hon. House affirm its support for its expansion of the pellet plant in Labrador

West when it is economically viable to do so.

Mr. Speaker, I would submit to Your Honour that this in no way, shape

or form, changes the intent of the resolution.

AN HON. MEMBER: Well, why change it?

MR. FUREY: Well, if it does not change it - and you obviously, by

your acknowledgement, agree that it does not - then you will vote for our amendment. I am

asking you -

AN HON. MEMBER: It completely changes it.

MR. FUREY: Does it?

AN HON. MEMBER: (Inaudible).

MR. FUREY: He has not even read it. He has not even read his own

resolution.

MR. SPEAKER: Order, please!

AN HON. MEMBER: (Inaudible).

MR. FUREY: Oh, I am sorry, I thought I just read it out.

MR. SPEAKER: The Chair will take a brief recess to consider the

amendment.

Recess

MR. SPEAKER (Penney): Order, please!

The Chair has considered the amendment to the resolution and would

refer hon. members to the Standing Orders of our Assembly, Standing Order 36: "A

motion may be amended: (

a) by leaving out certain words; (

b) by leaving out certain words

in order to insert other words; (

c) by inserting or adding other words."

I also refer hon. members to Beauchesne '567, "The object

of an amendment may be either to modify a question in such a way as to increase its

acceptability or to present to the House a different proposition as an alternative to the

original question."

I suggest that the amendment meets the requirements of our Standing

Orders and Beauchesne , and I rule that the amendment is in order. However, I would

ask the hon. member who moved the amendment if he could identify the seconder of the

amendment, please.

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

MR. FUREY: I apologize, Mr. Speaker.

The amendment is seconded by the Government House Leader, the Member

for Bonavista North.

MR. SPEAKER: Duly acknowledged.

MR. FUREY: Mr. Speaker, thank you for your ruling, and I am not

surprised. If you look at the recitals from the Leader of the Opposition's own proposition

which he has brought before the House today, and the second recital talks about where it

is economical feasible to do so, it is just really changing those words and putting them

in the resolve to re-state what the intention clearly was, which was not to embarrass the

member from Labrador City.

Mr. Speaker, the member raised a few points in his debate and I know he

will be listening outside, wherever he is, but I am astounded to see a Conservative Party,

a Conservative caucus, a party of business, a party that historically has been the

business party of Canada - and that is what they have been. They have been the business

party of Canada. They have been the spear holders for the establishment, for Bay Street,

and for Wall Street with the Republican Party. The Conservative Party of Canada -

I am astounded, because what I heard the Leader of the Opposition say

today is that he would move their party into an interventionist space. He would move them

from the right to the left. That must send shudders up the spine of the Member for Signal

Hill - Quidi Vidi, who is the real Socialist in this House, who is the real New Democratic

Party member. The truth be known, the Socialist should move his seat over to where the

Leader of the Opposition is because he really is a Conservative. He is a Socialist. He is

a Conservative in Socialist clothing. He is the wealthy lawyer, the independent lawyer.

The Socialist should really be the Conservative, and the Conservatives - all of you, with

the exception perhaps of the absolute right-wing fringe that would vote against

Confederation, like the hon. Member for Cape St. Francis... He is a real Conservative, a

dogged-true John Carter, blue-blooded Tory like there was never in the House before. He is

it.

I am astounded because what the Conservative Party has said here today

publicly is that they would intervene into the economy and force a business - the

Conservative Party being the party of business everywhere else on the planet - force them

to make an uneconomic decision.

Now I ask you: take that argument to its logical conclusion. They would

force FPI to make uneconomic decisions; NewTel to make uneconomic decisions; Kruger to

make uneconomic decisions; Abitibi to make uneconomic decisions. All of the other fish

plant operators and people who conduct business in this Province, who would present the

business case that is uneconomic - the Sullivan Brothers - to make uneconomic decisions.

Do you know what we would be left with? A welfare state, which is where their party really

is. It is way over on the left side of the spectrum.

Whereas the Member for Signal Hill -

Quidi Vidi, even the Socialist understands that there is only so much you can intervene in

the economy; that proper business practices have to stand up; that an economic case must

be made; that it must be a solid economic case to generate profit, which will generate

jobs.

MR. SULLIVAN: A point of order, Mr. Speaker.

MR. SPEAKER: Order, please!

On a point of order, the hon. the Opposition House Leader.

MR. SULLIVAN: Thank you, Mr. Speaker.

I cannot permit the minister to go on with this charade and state

something that is not factual. Maybe he could answer one simple question and that would

clarify the intent of what he is stating. Is the minister saying that it is not

economically feasible to put it in Labrador West? Is that what he is saying? Or it is less

economically feasible? Could he define it?

MR. FUREY: Mr. Speaker, old Rip Van Winkle just woke up.

MR. SPEAKER: Order, please!

There is no point of order.

I am sorry; the Chair had not recognized the hon. minister as he was

ready to rule on the point of order. There is no point of order. The hon. Opposition House

Leader took advantage of the opportunity to ask the minister a question.

MR. HARRIS: A point of order, Mr. Speaker.

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

point of order.

MR. HARRIS: Mr. Speaker, the minister's comments concerning the

relative positions of the party is very well known to New Democrats - that both Tories and

Liberals, in a period leading up to an election, act like New Democrats. It is only after

they get elected that they carry their free-market banner, whether they are Liberals or

Tories. Because we are in the lead-up to an election you will find the Tories act like New

Democrats, and I think we will even see the Liberals act like New Democrats during the

election period. It is only afterwards they change their mind.

MR. SPEAKER: The hon. the Government House Leader, to the point of

order.

MR. TULK: Mr. Speaker, I guess it is well known that people, when

they get into power, change the way they act when they are in Opposition. That is a

well-known fact; but I will tell you, there is another fact that we should consider and

that is that when certain leaders of certain parties - and I suspect the hon. gentleman

being the wealthy capitalist that he is - will take the same route as his former leader,

Mr. Fenwick, who came here and was left of left, and now Attila the Hun is left of Peter

Fenwick. Now we do not need to be reminded -

AN HON. MEMBER: Let the record show that he has agreed.

MR. TULK: You agree? And you agree that when you leave, the wealthy

capitalist, you will follow the same route? You have more money in more stocks than

anybody else that I know in this House, outside of Newfoundland. Refute it.

Mr. Speaker, there is no point of order from the other side.

AN HON. MEMBER: (Inaudible).

MR. SPEAKER: Order, please!

There is no point of order. Hon. members have been taking advantage of

the opportunity to engage in debate when there is a clearly defined process where hon.

members can engage in the debate today.

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

MR. FUREY: Mr. Speaker, the question that Rip Van Winkle woke up

and asked was: Is the project economic?

I have been saying for three weeks, for two weeks, a week, Monday in

the House, in the media, last night, today, the project is not economic in Labrador City

versus the project in Sept-Iles, Quebec.

SOME HON. MEMBERS: Oh, oh!

MR. FUREY: Let me finish. You are not letting me finish. Look, if

the hon. member is going to take his attack dog into the

House, he should at least feed him once a week.

Mr. Speaker, if the project had to go alone in Labrador - the $480

million; forget Sept-Iles - it is not economic, not economic, uneconomic. Let me deal with

the business of the total project, and the company, and all of its assets, that the Leader

of the Opposition talked about. It is the equivalent of saying that if Fishery Products

International had five fish plants and three were profitable and two were losers, we

should force them to blend together to take a reduced profit. That is what you are asking.

That is what they are saying, to make them less competitive, force the losers in with the

winners, to become less competitive internationally.

What a stupid nut case, voodoo economics that is, that this so-called

party of business, the Conservative Party, the party that has supported businesses and

businesses have supported throughout the century, are getting on here in public in

Newfoundland and Labrador with this kind of voodoo economics. How foolish can you get!

AN HON. MEMBER: (Inaudible).

MR. FUREY: No, they did not.

AN HON. MEMBER: (Inaudible).

MR. FUREY: Let me put it to the hon. member. I don't like to

personalize things, but let's personalize it. You ran a fish plant, okay? Before you ever

entered politics, you ran a few fish plants. Would you, if you were out in the business

community today, under your holding company, keep losers that were losing money open to

subsidize winners that were making money for you? Would you blend them and take less

profit so that your shareholders couldn't generate a return to be competitive? Answer it,

yes or no? Yes or no from your seat - from your seat. Sit down.

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

MR. FUREY: Sit down and answer it, Rip. Sit down and answer yes or

no. It does not require a big answer, does it? Is the answer yes or is the answer no?

Would he keep the losers open and blend them with the winners to take less profit, to

become less competitive to lay off more people? Okay, make a note and you can answer it.

SOME HON. MEMBERS: Oh, oh!

MR. FUREY: I told you what to do with your attack dog. Take him out

and feed him.

AN HON. MEMBER: (Inaudible).

MR. FUREY: Mr. Speaker, of course they would not, because what they

are saying is really voodoo economics. That is the best way to talk about it. It is like a

bunch of zombies sitting around and sticking pins in dolls, saying: We will do it this

way, we will do it that way, depending upon the moon.

AN HON. MEMBER: (Inaudible).

MR. FUREY: Good question.

AN HON. MEMBER: (Inaudible).

MR. FUREY: We did not promise that. What we did say -

AN HON. MEMBER: (Inaudible).

MR. FUREY: Let me finish.

AN HON. MEMBER: (Inaudible).

MR. FUREY: Mr. Speaker, I say to the hon. member that when she is

over here - and I believe she will be someday - as a minister, when she is a great, great

grandmother, when she is on this side of the House, she too will have to take

responsibility; not just to argue, not just to attack, not just to throw out innuendo, but

to take strong positions.

I ask the hon. member: Would she, as Minister of Mines and Energy, have

gone in as a weakling, as a wimp, taking a really flimsy position, or do you go in from a

position of strength so you can get certain things? And there were certain things that we

got.

AN HON. MEMBER: (Inaudible).

MR. FUREY: Sit down; don't be so foolish.

Mr. Speaker, the truth is that you go in from a position of strength.

MR. SPEAKER: Order, please!

The hon. member's time is up.

MR. FUREY: Mr. Speaker, by leave?

MR. SPEAKER: Does the hon. member have leave?

MR. FUREY: Mr. Speaker, I just need about ten more minutes.

MR. SPEAKER: Does the hon. member have leave?

AN HON. MEMBER: Yes.

MR. SPEAKER: By leave.

MR. FUREY: Mr. Speaker, I just wanted to conclude, before the hon.

lady rises in her place, to say that any reasonable person - any reasonable person -

Liberal, Conservative Party of big business, or Socialist - even the wealthy Socialist -

who knows business, who has run a business, who is a lawyer and who understands business,

any `reasonable' person, who looks at this case on its merits, who looks honestly at this

case on its merits, knows that the government did everything in its power to make this

happen.

The case rises and falls on the facts. The facts are very clear that

IOC presented, that Bechtel reviewed, that Hatch reviewed, that our own department

reviewed. We all came to the same conclusion. So did the Atlantic Provinces Economic

Council come to the same conclusion. So did the Newfoundland Chamber of Mineral Resources,

the industry people who operate in this Province, come to the same conclusion.

That leaves me with only one conclusion: They are not interested in

policy, they are not interested in truth, they are not interested in the business case;

they are simply interested in playing politics with an issue that is sensitive to one part

of our Province, and I predict that will come back to haunt them big time.

Thank you, Mr. Speaker.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The hon. the Member for Baie Verte.

MR. SHELLEY: Mr. Speaker I can start off by saying very quickly to

the minister: It is not going to be us who it is going to come back to haunt. The truth is

that we have been quite honest with this and listened to people up front. We went to

Labrador City very quickly after it all happened. A few things that the minister

conveniently leaves out of his discussion -

AN HON. MEMBER: (Inaudible).

MR. SHELLEY: Absolutely. The minister did give us a briefing which

started to raise more and more questions. The minister keeps talking about the Hatch

report. I had some problems with the Hatch report when we talked about a copper smelter in

this Province also. There were problems then.

Let us take, for example, one fact out of the Hatch report. We can go

through a full list in the Hatch report but I am not going to do that here today. We had a

briefing from Hatch. One of the numbers used in Hatch - I do not have the numbers in front

on me but - I think $24 million was part of the Hatch report that said they would need

accommodations in Labrador West.

Anybody in Labrador West can tell you very quickly they do not need

those accommodations, to build new accommodations in Labrador West. They have bunk houses

in Wabush, and they have all kinds of facilities throughout Labrador City that could be

used very easily. They do not have to build a camp for the construction in Labrador West.

That is $24 million right away we can take off the top.

Without going through a list of those in Hatch, how can we even start

to believe that they are all facts? If we want to talk about facts again, the first study

that IOC did, the Bechtel study, I am sure they had a lot more time and a lot more

information to use than Hatch. I want to go along with an example that was used by one of

the union members in Labrador City. Basically what Hatch did is, they went in and were

given the same numbers. If I gave you a set of numbers and somebody else in this Chamber a

set of numbers, you are going to add them up and get the same amount. All that Hatch did

was take the numbers that the previous study did and add them up and get the same numbers.

Really you have got to start asking yourself the question: What was the

Hatch report all about? That goes right to the root of this whole problem. A lot of people

in Labrador West and in this Province wonder what really went on here. What went on was:

On June 2, 1997, the government had the answer clear that this company had all the

intentions of expanding in Sept-Isle, Quebec.

Then the minister himself, who has left the Chamber right now, admitted

that they could not really have a challenge, that if they had to challenge the legislation

that is in place right now for the Iron Ore Company of Canada they would not win that

challenge.

Mr. Speaker, those two things don't jive. If the government was going

to mount the attack on IOC they knew they could not do it under the current legislation.

So why was there the whole process of the Hatch report? There was only one main lever that

could have been used by this government and it was not the process of going with Hatch.

There was one - and everybody in this House of Assembly should read Cain's

Legacy . It is all about IOC, its history and how it began. There is one particular

section when the premier of the day, Joseph R. Smallwood, had a ten-minute meeting with

the Iron Ore Company of Canada. The Member for Labrador West knows this book very well.

Let me back up for a second. Prior to that meeting the Iron Ore Company of Canada said

publicly that they were going to put the pellet plant for Labrador City in Sept-Iles,

Quebec. That was their intention. They publicly stated thirty-eight years ago now that

they wanted to put the pellet plant for Labrador City in Sept-Iles, Quebec.

There was a quick meeting. I cannot remember the other individuals

involved in the meeting but you can get it from the book. After a ten minute meeting, in

which the then-Premier, Joseph R. Smallwood, said to the company: Yes, you can go to

Sept-Iles, you can put your pellet plant in Sept-Iles, Quebec. We do not have anything

that stops you in the legislation of the day. We do not have anything that stops you

legally. He just simply said: As the Premier of Newfoundland and Labrador I will make your

lives miserable. Whatever I can do in my power and my authority as the Premier of this

Province I will do, and you will not like it.

That is basically what it said. You can paraphrase it all kinds of

different ways, but that is what it says in the book. After a ten-minute meeting the Iron

Ore Company of Canada came out and said: No, we have changed our mind, we have decided not

to put it in Sept-Iles, Quebec, and we will put a pellet plant in Labrador City where you

see it today.

That was the lever that was missed. The premier of the day, Joseph R.

Smallwood, was under the same legislation as the Premier of today faces. I have said it

many times already and I will say it again. On June 3, the Premier of this Province and

the committee, the Member for Labrador West, the minister, and whoever, should have been

in a boardroom with North saying: We are glad you are coming, we are glad you are

investing, we are glad that you are spending money on expansion, and we know that we

cannot stop you with the legislation that is in place. But the Premier of the day never

ever said to them what Joseph R. Smallwood said to them. That changed their minds. That is

in the history books. It is not something that is fabricated.

Like we have always said, the Member for Labrador West, on a personal

note, we have never mentioned him publicly. I haven't, and neither did the Leader of our

party, at any time talk about his attempts and his intentions. By the way, as a member,

when I first got elected, I faced some of those controversial situations in my own

district. We all do as members from time to time, and that is tough stuff. We are not

talking about the member personally. We are talking about the government in general and

the way they approach situations. I want to make that clear to the member, that it was

government's attempts, not the member's attempts. I am sure his intentions were there and

he did what he could do under the circumstances and so on. He will have to answer to his

electorate, like I would to mine, or any other member in this House of Assembly. What he

is going to be questioned on is what his government's attempts were. Was it enough?

To move away from the details and to get into the principle on what he

is going to have to go to his electorate with, the argument is that: Your Premier was

really tough with Inco, beyond normal. It is not normal what the Premier of this Province

did with Inco. Beyond the Legislature he had to make some changes now that is going on. He

was very tough. When you look at him when he dealt with the Estai , it was not

something normal that the Premier now - who was the Minister of Fisheries at the time -

did with the Estai .

What I am saying to the member, and other members in this House, when

you look at the public perception of it, the people in the Province were saying: Boy, a

tough premier. Add on to that that the Premier, the member, the minister and everybody

else, including myself, when I asked the first day, June 2, in this House, I believed that

you had a great battle going. I thought you had a great fight going. I felt secure and

assured, and so did the people of Labrador West, that we were going to win this battle.

No matter which way you cut it, that's the way the people felt. Whether

it was unjustified or it was not for real, that's how they felt. We cannot take that away

from them because everybody I have talked to up there said the same thing. As a matter of

fact, from time to time over the last year and a half or so I would run into somebody from

Labrador West, or I would speak to my family who still live up there. When they would ask

me about it, I would say to them: No, I think it is going to be okay, I think you are

going to get the pellet plant. I honestly believed that, I say to the minister, I really

did.

I will not go into the statements for the sake of pettiness to say what

the Premier said or the minister said at a chamber. We do not need to go into that. We

will not even use them. The point is that people in the area were solidly convinced that

would not happen. When it happened they had to start asking some questions, and then they

started asking themselves: Besides the commitment we had, we had this backing of a premier

who took tough stands, who went above and beyond the normal call of duty, so to speak.

This is a premier (inaudible) normal. This a Premier that took on the

tough battles and went outside of the legislation. Remember he was going to turn off the

power to Churchill Falls. Go across Canada. He went outside international law with the Estai .

That is what they were expecting. What happened was the reverse, and what I would say is

that the people of Labrador West still feel about it the same way today. The approach that

was taken on the Hatch report and so on, the people asked the question: Was it a complete

sham right from the beginning? Was this process that we were walked through a case of

futility? Where it really was not going anywhere, but the image had to be there, the

perception was there, that we were putting up this great fight.

There is another point I would like to make. When people in Labrador

West started to compare the fight that this government had with IOC, then they did two

comparisons, Voisey's Bay and Churchill Falls. Let's stick to Voisey's Bay first. When

they did the fight on Voisey's Bay - the Minister of Mines and Energy was not the only one

involved, and the Premier himself -, and many discussions and negotiations that were going

on, they brought in the expert. They brought in the expert from Ottawa, Mr. Rowat. They

were going to bring down the best available personnel in Canada to take on the fight for

Voisey's Bay.

Let's take a step away from that, let's look at what they did with

Churchill Falls. Was the Member for Lake Melville involved in a committee? No. Was it the

minister himself that was going to deal with energy? No, it was Mr. Thistle. If I am not

mistaken, Mr. Thistle took on the Churchill Falls. I cannot lose this train of thought

because it was a good point made by some people in Labrador West. What we saw was that in

the comparisons, when they took on Voisey's Bay they sent for the outside experts. They

did not just let the minister handle it. No, it was a big issue. They couldn't let the

minister handle it. Mr. Rowat had to come down to handle it. We had to send for the

experts. Nobody in Cabinet could handle it.

Then we went to Churchill Falls and nobody in Cabinet could handle it

again: We will use Mr. Thistle. When it came to IOC, what was it? They let the local

member head up a committee. No sign of the Premier. How many times did you hear the

Premier speak up on this issue while it was ongoing? Except for when he was at the Winter

Games to say everything was fine: Do not worry about it, I will be on the first flight to

Australia. That is the only time I heard the Premier talk about it. Everybody talks about

the facts, but there is much more to this than the facts. The so-called facts, the facts

that the government wants everyone to believe.

The fact is there is another resource going out of this Province to

benefit another province. Was the best fight put up to stop that? No. That is what the

verdict will be on this. If you walk into Labrador City today and ask the people there,

that is what they will say. They are tired of seeing the resources go out of the Province,

and they let this one slip through their fingers too easily. No, they do not believe it

was a good fight put up on it.

Let's look at our fishery resources. The Minister of Fisheries and

Aquaculture always talks about how we should do more secondary processing in the Province,

bring in new stuff to do. We have to remember something here. The processing done in

Labrador City, and what is going to be expanded now into Sept-Iles, Quebec, is not new.

They have already been doing that in Labrador City. We are not talking about bringing in

new processes. They are already pelletizing in Labrador City. It is not a new process.

Basically they are going to expand on a process that has been there for thirty-eight

years. That is why people do not understand why it cannot be done in this Province.

Economically viable? To who? To the company, of course. Do we mean

economically viable, or do we mean profits and more profits? We are talking about more

profits, that is what it all comes down to. That is why the people are upset. That is why

the people in Labrador West do not accept this, and a lot of people in the Province do not

accept it. When we talk about facts, there is more to the facts than what the government

wants us to believe, or would like us to believe, I should say.

The people in Labrador West, with the economic benefits that have

accrued over the years from that particular part of the Province, have a right to be

frustrated, have the right to feel betrayed. Because they are not settling for it. No

matter how long this goes on, they never ever settle for what happened in Labrador West.

AN HON. MEMBER: How do you know?

MR. SHELLEY: Believe me, I know very well. They will not accept it.

It should never have happened. It should have been nipped in the bud the day that it

happened. The people in Labrador West are speaking up -

MR. GRIMES: (Inaudible).

MR. SHELLEY: I just did it. The Minister of Education must have

been sound asleep over there because I just went through it, but I will do it again, I

will repeat it. Because the Minister of Education has had this ornery look about him all

day long. He gets on edge after awhile, and the Geritol slowly dilutes in his system so he

has to go out for another shot. He comes back and he is okay then. All he needs is a few

people to sing out `four' and he is okay.

AN HON. MEMBER: The golf season must be over.

MR. SHELLEY: Golf season is over. He gets so ornery, that is what

happens. I will repeat it again, Mr. Speaker. I still say that on the day of June 3 the

minister, the Premier, whoever was in that committee they are talking about, should have

sat down with North and said: If your intentions are to expand into Labrador City, yes,

according to the legislation that is in place now, you can do it. Go ahead, we know we

cannot stop you that route. But Joseph R. Smallwood thirty-eight years ago said to that

same company, with the same question: Yes, you can do it, but I as the Premier of this

Province today -

MR. SPEAKER: Order, please!

The hon. member's time is up.

MR. SHELLEY: - will use every power available to stop it. The

decision was changed ten minutes later. Read Cain's Legacy . That is what the

Premier of the day said. That is what changed it, Mr. Speaker.

MR. SPEAKER: Order, please!

Is the hon. member speaking by leave?

SOME HON. MEMBERS: No leave!

MR. SPEAKER: No leave has been granted. I ask the member to take

his seat.

The hon. the Member for Labrador West.

MR. CANNING: Thank you, Mr. Speaker.

I want to talk again, as I did the other day in my speech to the House,

regarding the expansion plans of the Iron Ore Company of Canada. More particulary their

corporate decision to open an old pellet plant in Sept-Iles, Quebec.

This decision has caused a very frustrating experience in Western

Labrador. There is a lot of anger. The reality is nobody anywhere in this Province wanted

to see the Iron Ore Company of Canada open that old pellet plant in Sept-Iles. There is

not a single living soul that I know, there is certainly nobody on this side of the House,

that wanted to see that occur.

The previous speaker talked about Joseph R. Smallwood and his defense

of the resources in this Province, and more particulary his view that they had to build a

pellet plant in Labrador City. That was his view. It is easy to read in Cain's Legacy .

There was no town there at that time. He could have waited, he had time on his side, as we

do now with Inco.

We are in a situation in this Province, whether we like it or not,

whether we want to accept it or not, where the Iron Ore Company of Canada has been for

some thirty-six years exporting two products, pellets and concentrates. This year they

will have exported about 12.5 million tonnes of pellets. If you stand by Wabush Bridge and

look at the train, two-thirds of that train has pellets, one-third of that train has

concentrates. There are 4 million to 5 million tonnes of concentrates going down over that

railway into Quebec. It has been doing that for thirty-six years.

Technically, the company does not have to expand their concentrating

capacity in Labrador City to feed enough concentrates to Sept-Iles. If they decided not to

expand the concentrator - they have decided to expand the concentrator in Carol Lake,

incidentally - but if they didn't, they still have access to 5 million tons of concentrate

that is flowing down over that railway this year, last year, the year before, and years

before that for thirty-six years.

What would the folks on the other side have us do? Would they say we

must pass some piece of draconian legislation that says you must keep that ore in the

ground unless you pelletize it in Labrador West? That would have an immediate and very

terrible effect on the workforce here in Labrador West. Would you have a law of general

application saying no concentrate shipments? That is what the Leader of the New Democratic

Party said. He said: Yes, there will be a law of general application that says no

concentrates shipped on the QNS & L Railway from either Labrador City or Wabush Mines.

What would he have Wabush Mines do? Shut down? Is that what he would

have them do? They do not pelletize Wabush ore in this Province. They pelletize it in

Pointe Noire, in Sept-Iles, Quebec.

If you are going to have a law of general application - as the lawyer,

the Leader of the New Democratic Party, would say - then that has to be applied to Wabush

and the Iron Ore Company of Canada. The problem is that we have faced a very challenging

circumstance but we took it on. We took it on with every bit of vim and vigour possible.

Mr. Speaker, there are some today who criticize us for being too

strong. I remember the meetings we have had with senior officials of the Iron Ore Company

of Canada. I served twelve years on the executive of the steelworkers. I can tell you,

those meetings we had were as tough or tougher than any meetings I have ever sat in

between the union and the company. We laid our cards on the table and we were very firm

with the resolve that your expansion will come under the 1995 legislation. That was the

view that we took.

We cannot back up the clocks and put the whole of the project under

that legislation. They do have

an act that was signed in 1938. Again, whether we want to

accept that or not, it is a reality. It was signed eleven years before we joined Canada.

They have been mining for thirty-six years, almost four decades. They have mined a million

tons - one-third of their product has been concentrate - and we are going to pretend that

none of that happened?

Mr. Speaker, there is no doubt that when we engaged this issue on

behalf of the people in Labrador West - in fact, on behalf of the people in the whole of

the Province, it was a tough struggle. We had a tough fight on our hands, but I can tell

you that we fought that to win.

I was as disappointed or more, given the amount of work we have put

into this in the last eighteen months, I was more disappointed - or at least as

disappointed - as any person in this Province. I can tell you, so were the members of this

government.

If I had thought for some reason, somehow, members on this side

contributed to our loss of that opportunity, or did not do enough, I would be angry with

them, too. They know that I was watching to ensure that they would do everything that is

literally possible to do, and they did that. They did that because the people of Labrador

West expected them - indeed the people of the Province expected them - to protect the

resources of this Province. That is why we passed the resolution on May 7 outlining what

we expect out of our resources.

AN HON. MEMBER: (Inaudible) May 6.

MR. CANNING: I have May 7, Mr. Speaker.

I can tell you that all people in Labrador West are absolutely

frustrated and there is anger.

AN HON. MEMBER: (Inaudible).

MR. CANNING: Yes, of course there is.

What can the government do now? Should we nationalize the company and

take control of their Board of Directors? Is that what we should do? Because, short of

controlling their Board of Directors, they have a decision-makin

Document details

CollectionNewfoundland and Labrador — Debates (Hansard)
Citation1998-11-18
Typehansard
Volume / chapter1998-11-18
Languageen
Formathtm
SourcePROVINCIAL
Identifier360ac17c20587d7166cec460c6abefa524feb804

Source file is stored in the law ingest library (htm).