June 18,

1993 HOUSE

OF ASSEMBLY PROCEEDINGS

Vol. XLII No. 18

The House met at 9:00 a.m.

MR. SPEAKER (Dicks): Order, please!

The hon. the Member for St. John's South.

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

I think it is worthy of note this morning that I had the

opportunity last evening to attend the national darts dinner, and I think it is

even more worthy of note that, after the week, Newfoundland not only captured

the Canada Cup, but the players from Newfoundland, all over the Province, also

captured the mixed doubles, the men's doubles, and - I'm not sure of the other

one now. Anyway, we have three championships. The ladies' singles and the men's

singles are on today. We have a good chance of winning the ladies' singles.

Something else I was told last night was that these groups,

from all across Canada, which is really encouraging - a lot of them are staying

on, going fishing, going hunting - not hunting, but fishing, and taking their

holidays here in the Province.

SOME HON. MEMBERS: Oh, oh!

MR. MURPHY: It is not unusual, I say to members opposite,

for some people to go hunting out of season.

I certainly offer congratulations. I think it is `a real good

show' on behalf of the Province and the dart players in the Province.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The hon. the Member for Burin - Placentia

West.

MR. TOBIN: Mr. Speaker, I would like, for this side of

the House, to share the sentiments expressed by my friend from St. John's South.

Obviously, I have somewhat of a vested interest, in that one of my constituents

has made a name for himself in darts, internationally. As a matter of fact,

Albert Anstey, from Burin, is ranked in the world, I think, in number three

position. I am delighted to see that Albert has done well again this time as

have all the other people who participated from Newfoundland. It is that type of

participation that has given Newfoundland world recognition, and I am delighted

to see that some of them are going to stay here on holiday and spend their

money.

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

MR. HARRIS: Thank you, Mr. Speaker.

It is always good to see Newfoundlanders do well at national

events, particularly when the events are being held here in this Province. They

are deserving of the congratulations of this House and we welcome them here to

this Province.

Statements by Ministers

MR. SPEAKER: The hon. the Minister of Forestry and

Agriculture.

MR. FLIGHT: Thank you, Mr. Speaker.

Mr. Speaker, I wish to outline to this hon. House my position

on the decision of the Agricultural Products Marketing Board with respect to the

manufacture and sale of reconstituted milk in this Province.

Reconstituted milk is made by combining powdered milk with

butter or cream and water. It has been manufactured in this Province for years,

and ten years ago, reconstituted milk represented 25 per cent of all the milk

consumed here in this Province. However, processors voluntarily withdrew from

reconstituted milk in favour of fluid milk from Newfoundland farms. Today,

reconstituted milk is only 1.7 per cent of the sales on the Island. Meanwhile,

our dairy industry has been able to expand until we now have sixty dairy farms

and are approximately self-sufficient in fluid milk. This has been an

agricultural success story.

Mr. Speaker, the only plant on the Island of Newfoundland

producing reconstituted milk, which has been operating since 1965, is in

Lewisporte. It is owned by the Brookfield Dairy Group and employs six people.

The plant possibly creates an equal number of indirect jobs. There is, however,

another plant in Labrador which produces milk for the military establishment

there.

Mr. Speaker, the Newfoundland Milk Marketing Board regulates

the production, processing and sale of milk in this Province. They had sought

approval from the Agricultural Products Marketing Board to stop production of

reconstituted milk by December 31, 1993. The Agricultural Products Marketing

Board felt that that was not in the best interests of all parties, and ordered

that production should continue until the end of 1994. The Labrador production

should also be allowed to continue, but only for the military market. The

Agricultural Products Marketing Board has advised the Newfoundland Milk

Marketing Board that they would reconsider this matter and permit gazetting of a

revised order along these lines.

Mr. Speaker, it is very rare for a minister to intervene in

decisions of such boards, but this has been a particularly sensitive issue and I

have decided to ask for the board's recommendation to be modified. I have

considered all factors and I am satisfied that I have reached a fair resolution

to the issue.

After much deliberation, Mr. Speaker, I have decided to

inform the Agricultural Products Marketing Board that the proposed order should

not be approved or gazetted in its current form. I agree that the Lewisporte

plant should be allowed to continue in reconstituted milk to the end of 1994,

and that production should be limited to the average of the years 1990 to 1992.

However, I believe that production should be allowed to continue beyond 1994,

but only if Central Dairies, the only competitor of Brookfield, is allowed to

produce an equal volume beginning in 1995 with the same limitations. I am

therefore asking the board to implement this policy. The Labrador production

would be permitted to continue, of course.

I want to emphasize, Mr. Speaker, that this is the limit of

production of reconstituted milk that will be allowed. If there is increased

demand for fluid milk, it must be met by local production from our dairy farms.

I would also like to put dairy processors on notice that the production of

reconstituted milk will be closely monitored as to volume and fat content and

all relevant regulations will be strictly enforced.

Mr. Speaker, government have made it possible for the diary

industry to prosper in Newfoundland and Labrador, and it cannot be reasonably

argued that the volume of reconstituted milk produced at Lewisporte will cause

serious injury to the fluid milk industry or inhibit its future growth and

expansion. However, there is the matter of job loss in the area, as well, and

that is a concern for me. This government is always concerned when people face

economic hardship. At the same time, Mr. Speaker, I want to assure diary

producers that this decision does not diminish goverment's support for supply

management or for their industry.

Thank you, Mr. Speaker.

SOME HON. MEMBERS: Hear, hear!

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

Bay.

MR. SHELLEY: Thank you, Mr. Speaker.

to the minister's statement, which I have just received,

basically I can say it is simply a response for the interim. I think there are

many questions and concerns still to be addressed. Obviously, there are people

in the industry who are going to disagree with this point. As it regards the

question of the jobs, it is something we agree with - that has to be a concern

of everybody. But I think the bottom line in all of this is that it is

unfinished business and it will continue after 1994. What has to be looked at

here is the long term, down the road, because I am sure there are going to be

concerns and arguments brought forward yet. So, basically, I think the statement

is a slowdown or an interim answer to what is going to come in the future.

Thank you, Mr. Speaker.

MR. SPEAKER: On behalf of all hon. members, I would like

to welcome to the public galleries the former Member for St. George's, Mr. Larry

Short.

SOME HON. MEMBERS: Hear, hear!

Oral Questions

MR. SPEAKER: Order, please!

The hon. the Leader of the Opposition.

MR. SIMMS: Mr. Speaker, this government has reintroduced

a piece of legislation that was first introduced last December and then

withdrawn. In effect, the bill gives a tax break of about $150,000, we are told,

to a company known as Fortis Trust, which is a subsidiary of Fortis

Incorporated, a company that also owns Newfoundland Power. I ask the Premier:

Why is this government so determined to give such a large tax break to this

particular company? It is one of the most privileged and protected companies in

the world, I suppose. I ask him: Why doesn't he instead, give a tax break of

some sort to all the other businesses in this Province which are scrambling to

survive under the burden of new taxes and increased taxation brought on by his

own government?

MR. SPEAKER: The hon. the Premier.

PREMIER WELLS: Mr. Speaker, that tax break is given to

any company that is prepared to do what Fortis Trust is doing, providing for a

means of investment in this Province, providing for an opportunity for people in

the Province to invest in local businesses. What we can't do - to respond to

narrow-minded political commentary - is prevent the fair operation of our law so

as to attract, particularly, Newfoundland investors to invest in this Province.

We don't want to maintain a tax structure or a tax position that deters

investment in this Province - that is why we cut the corporate income tax from

17 per cent to 16 per cent; that is why we cut the small business tax from 10

per cent to 5 per cent; that is why we cut the manufacturing and processing tax

from 17 per cent to 7.5 per cent. That is why we are doing it - to promote job

opportunities and promote investments in this Province. And, for the Opposition

to resort to this, to lead people to believe that this is somehow special

treatment for Fortis Trust because it is Fortis Trust, is absolutely disgusting!

MR. WINDSOR: You are disgusting!

SOME HON. MEMBERS: Oh, oh!

MR. SPEAKER: Order, please!

A supplementary, the hon. the Leader of the Opposition.

MR. SIMMS: Thank you, Mr. Speaker.

So we are told that this is not meant for Fortis Trust, this

is not a special break for Fortis Trust, yet we were told by the Minister of

Finance, in December, that is the only company that will benefit from it, number

one. Number two, the Premier says it is for investment purposes, to try to

encourage investment down the road. Can the Premier tell the House: Why is the

legislation structured in such a way as to make it retroactive to last October?

MR. SPEAKER: The hon. the Premier.

PREMIER WELLS: Because, Mr. Speaker, that is when the

legislation was intended to be brought in, I assume, and it wasn't.

AN HON. MEMBER: It wasn't brought in.

PREMIER WELLS: It was brought in - it was introduced in

the House, it was debated on second reading here in the House and died on the

Order Paper. Mr. Speaker, any business company wanting to operate on exactly the

same basis and provide the business and investment opportunity, the savings

opportunity, is entitled to that benefit -anybody!

MR. WINDSOR: What happened to the stocks savings plan?

PREMIER WELLS: It cost the Province too much money. It

cost the Province an immense amount of money.

MR. SPEAKER: Order, please!

The procedure in Question Period is one question at a time.

If the hon. the Member for Mount wishes to ask a question, I will recognize him

in due course.

SOME HON. MEMBERS: Oh, oh!

MR. SPEAKER: Order, please!

The hon. the Premier.

PREMIER WELLS: I would like to finish the answer now, Mr.

Speaker, without interruption.

Mr. Speaker, that taxation would induce companies like Fortis

Trust who are providing for investment opportunities for Newfoundlanders who

want to invest in savings companies, would provide a circumstance where they

would not be prepared to capitalize the company properly and so investors would

not get protection. We don't want circumstances where investors lose their money

in circumstances as has been done in other cases here, in the case of Principal

Trust and others, where there have been significant losses. We want to have the

maximum level of protection, and in particular, Mr. Speaker, we would like to

see companies like NewTel Enterprises, which makes a lot of money in this

Province, and like Fortis which makes a lot of money in this Province - we want

to see them reinvest their money here and create opportunities here, and every

chance we can get to cause them to do just that, we will do it, because we have

the interest of this Province at heart.

SOME HON. MEMBERS: Hear, hear!

SOME HON. MEMBERS: Oh, oh!

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

MR. SIMMS: The Premier can be as loud and boisterous as

he wants to be in answering this question, the fact of the matter is this is a

tax break for buddies of the Premier and buddies of the Minister of Justice -

that's what is happening. Now, the Premier avoided answering the question. He is

trying to convince the members of this House of Assembly and the public that

this is meant to encourage investment down the road. Why is it retroactive to

last October? Answer that question directly.

MR. SPEAKER: The hon. the Premier.

PREMIER WELLS: Mr. Speaker, the comments of the Leader of

the Opposition are offensive and insulting!

SOME HON. MEMBERS: Oh, oh!

PREMIER WELLS: Mr. Speaker, let me remind members of this

House that I was chairman of the board of the company that has become Fortis

Trust, before I got involved in politics. Now, Mr. Speaker, I am not prepared to

be pushed or have the government pushed or intimidated by sleazy political

comments to prevent the fair treatment of every business in this Province, and I

will not succumb to such pressures by the Leader of the Opposition. We will

govern this Province on a fair and balanced basis, Mr. Speaker, and not

otherwise.

SOME HON. MEMBERS: Hear, hear!

SOME HON. MEMBERS: Oh, oh!

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

The hon. the Leader of the Opposition.

MR. SIMMS: Thank you, Mr. Speaker.

I am delighted that the Premier is offended by my question,

absolutely delighted, because he deserves to be offended by it, and that is the

reason for the question. But a good offence, I guess, is the answer to a defence

in this case. He still has not answered the question. If he will answer the

question honestly and directly, then he won't get this kind of questioning.

Why is this legislation retroactive to last October? It does

not fit with his argument that it is meant for the future, to encourage

investment, because only Fortis Trust will benefit, and they will get a tax

break now for last year, because of this legislation, as well as this year.

AN HON. MEMBER: (Inaudible).

MR. SIMMS: Oh yeah, sure!

SOME HON. MEMBERS: Oh, oh!

MR. SPEAKER: Order, please!

The hon. the Minister of Finance.

MR. BAKER: Thank you, Mr. Speaker.

This bill was originally introduced into the House last Fall,

I believe early in November, and for a variety of reasons, including agreements

reached between House Leaders and so on, at the closing of the House, was one of

several bills left on the Order Paper. We have simply re-introduced it.

MR. SIMMS: Everybody knows that.

MR. BAKER: Well, that is what I am explaining. I am

giving you the answer to your question.

Mr. Speaker, this bill was designed to correct a tremendous

inequity in our tax system, whereby we give one tax treatment for the large

trust companies and banks, and yet for the smaller ones that want to start out

and are in business, our tax system charges them forty to fifty times the

effective rate for the larger businesses.

Mr. Speaker, this bill simply corrects an inequity in our tax

system that will allow smaller trust companies to develop and grow, and when

they develop and grow to the point where they become large trust companies, they

will be treated on the same basis.

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

MR. WOODFORD: Mr. Speaker, my question is to the Minister

responsible for Social Services.

For some time now, the Department of Social Services has been

sending out letters to people around the Province - and I am really familiar

with this in my district, in particular - saying that government's records

indicate they have an overpayment, and outlining some of the different reasons

for it.

Can the minister now inform the House if the letters that

have been sent out demanding the payments are resulting from the hiring of

investigators for the ten new jobs created in this year's budget? Will he

confirm that? And will the minister tell the House how far back his department

has gone in trying to collect? Has it gone back one year, two years, five, ten,

fifteen, twenty? Will the minister tell that to the House?

MR. SPEAKER: The hon. the Minister of Social Services.

MR. LUSH: Mr. Speaker, first of all, I don't think that

the matter of the overpayments has anything to do with the ten investigators,

because they haven't started working yet; so I don't think there is any

relationship between these two. It is hardly possible.

With respect to the overpayments, as the hon. member knows,

when people are paid in excess of what they deserve, or they are given an

overpayment in any respect, then it is the obligation of government, on behalf

of taxpayers, to collect this money. How far we go back, I have no idea, but I

only know, in my own experience in this job, that they have gone back many, many

years. Whether the Department of Social Services is selecting a particular point

in time, I have no idea, but I will check it out for the hon. member.

MR. WOODFORD: A supplementary, Mr. Speaker.

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

MR. WOODFORD: Mr. Speaker, I have a copy of a letter that

was sent to a lady in my district requesting the sum of $629.71. She was told

that was considered an overpayment that resulted when she and her late husband

had an overlap of social assistance and his UI benefits in 1973 - twenty years

ago, Mr. Speaker.

MR. SIMMS: Shocking!

MR. TOBIN: Her late husband.

MR. SPEAKER: Order, please!

MR. WOODFORD: In view of the fact that this lady's

husband predeceased her some six years ago, and in view of the fact that this

government, last night and this morning, this day, is helping one of the most

powerful corporate giants in this Province save some $150,000 a year, will he

make a commitment now to the House to have this $629.71 that was incurred some

twenty years ago written off for this lady?

MR. SPEAKER: The hon. the Minister of Social Services.

MR. LUSH: Quite apart from the convoluted nonsense that

the member got in near the end of the question, it is the intention and the

desire of government to deal with every problem in a most sensitive manner. I

can tell the hon. member that this problem is no different from any other, that

it will be dealt with. It has to be investigated. There is nothing to suggest

that this is insensitive merely because the government says it wants to collect

the money that is owed it. It is collected on behalf of the taxpayers of this

Province. The insensitivity would result if, after the letter, certain events

took place demonstrating insensitivity. If that is the case, certainly we will

look into it. But it is the responsibility of government to collect monies that

were paid in excess, on behalf of the taxpayers of this Province, and time has

nothing to do with it. But each case is analyzed, assessed and dealt with in

terms of the circumstances that surround that particular case.

MR. WOODFORD: A final supplementary, Mr. Speaker.

MR. SPEAKER: A final supplementary, the hon. the Member

for Humber Valley.

MR. WOODFORD: This government is just about to institute

a social strategy for this Province. How can they develop a social strategy -

first of all, you have to have a social conscience, Mr. Speaker.

SOME HON. MEMBERS: Hear, hear!

MR. WOODFORD: How can the minister explain the word

`sensitivity' when they just sent a letter to a sixty-five-year-old woman,

living alone, almost completely blind, whose husband predeceased her six years

ago, who raised nine children without any help from government? How can the

minister call that `sensitivity'? Would he take it upon himself today to contact

his department and his officials to have this measly, lousy $629.71 written off

for this lady?

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The hon. the Minister of Social Services.

MR. LUSH: I can tell the hon. member that the policy of

this government in terms of dealing with the social needs of this Province in

terms of trying to safeguard the safety social net of this Province is one that

is responsible, efficient and effective, and is governed by the fiscal ability

of the Province to pay. That is it, Mr. Speaker. That is the essence of the

policy of this government and of the department.

MR. SPEAKER: The hon. the Member for Mount Pearl.

MR. WINDSOR: Mr. Speaker, on Wednesday, we passed some

legislation, a bill called the guarantee loan act. The Premier, prior to the

1989 election, stated the policy of his party at the time that he didn't agree

with government-guaranteed loans. Obviously, we see they have gone back to that.

In fact, he even threatened to cancel some of the loans that were in place at

the time. Would the Premier like to tell us now, in view of the gifts he is

giving Fortis, what is the policy of this government relating to

government-guaranteed loans to corporations that need assistance?

MR. SPEAKER: The hon. the Premier.

PREMIER WELLS: Mr. Speaker, I don't know what an

assessment would show but I must ask the minister to do it. I think he would

find that the number of guaranteed loans has greatly diminished in the last four

years. I think that is what would be found but I will ask him to check it out,

and I will table it in the House and provide a comparison, say, with the

previous four years - because that is always good - so you get a fair standard

by which to judge. I will ask him to do that.

Our basic approach is a change from former governments, not

just the former Conservative Government, from the former Liberal Government,

too. We looked at the results over the last thirty-odd years and it was clear

that we were not achieving a high degree of success by guaranteeing loans - that

usually got the government in further and further and further. Once you made the

first guarantee, you made another to back it up and you got in so deep. Usually,

the people who were seeking guarantees had no substantial capital resources

themselves and no ability to meet difficult times or problems that arose. So

government would have to guarantee some more and you got into the quagmires like

we got into in the past with the Linerboard Mill, the Come By Chance Oil

Refinery, like the cucumber proposal in Mount Pearl, all of those got the

government into circumstances where they lost vast sums of money. We took a

different approach. The approach that we took, Mr. Speaker, is that it would be

far better for the government to look at providing tax incentives or equity

investment to induce those that had more substantial resources themselves to

invest. That is why you will see a significant reduction in the number of

guaranteed loans.

I heard the hon. member's comment the other day that the

government should be getting a share of the interest earned by banks where the

loans are guaranteed. I met with the banks three years ago and told them that

was the government's position and, as a result, we put in place a guarantee fee.

And now, any time the government guarantees any indebtedness, we get a guarantee

fee and we don't expect that the banks will hike up to cover that. They should

be giving credit on the basis of the level of security that they have. Now, they

did say to me at the time: `But there is another problem. There is the

administration cost and our interest rates are determined, not only on the basis

of risk element, but on the basis of the level of administration that is

necessary. If loans are troublesome, we still have the same level of

administration costs.' Well, I can see there may be some merit in that, but at

least, there should be a return for government.

MR. SPEAKER: The hon. the Member for Mount Pearl.

MR. WINDSOR: Mr. Speaker, I am sure when the minister

does his study, he will find, in fact, that there are far less guarantees. He

will also find that there are 20,000 more people unemployed in this Province and

record numbers of bankruptcies in this Province, Mr. Speaker - that is what the

minister will find when he does his study.

I want to ask the Premier this: What is he doing to attract

investment to this Province? We see Premier McKenna of New Brunswick now, rated

one of the most active Premiers in Canada. He is in Central Canada every month

attracting business to his province. We know what Enterprise Newfoundland and

Labrador is not doing. We know the Premier is running across Canada talking

about the Constitution, trying to raise his own national political image. What

is he doing to create jobs and attract business to this Province?

MR. SPEAKER: The hon. the Premier.

PREMIER WELLS: Let me deal with both points. First, with

respect to the reduced number of guarantees and its relationship to the number

of unemployed. I will point out to the hon. member that there were fewer - a

smaller portion of our workforce unemployed in this recession than in the 1982

recession when he had personal responsibility. The figures are there, the Stats

Can figures are there. They are not my figures and they are not the hon.

member's figures, they are the figures of Stats Can. Now, I know he doesn't like

it, it gets him stirred up. As you can see, he tries to prevent the truth from

coming out but the truth sets reasonable people free. Other people, like the

hon. member, feel chained by it because it doesn't help them any and I can

understand his position.

Now, Mr. Speaker, on the other point, I agree with the hon.

member, that it is desirable to make every conceivable effort, travel wherever

it is necessary, promote wherever it is necessary, make whatever reasonable

adjustments in our tax laws, in our regulations that are necessary and fair to

promote business investment in this Province, because it is only from such

business investment that job opportunities will come. There is not much point in

doing it at times during the middle of a recession when the economic world is

facing immense difficulties.

Mr. Speaker, we have been preparing for a push that is to

take place now. The Minister of Industry, Trade and Technology has laid the

groundwork for a business prospecting system and that, Mr. Speaker, is in

progress. I will be doing a good deal of the promotion and travelling myself.

Most of it will be done by the hon. minister and it will be done by others. Mr.

Speaker, we intend to rebuild the economy of this Province, as we started out,

but every fair-minded person knows and understands that you can't do that in the

middle of a recession, and it is no good wasting your money and efforts trying

to do it at that time. Do it when success can be achieved.

MR. WINDSOR: A final supplementary, Mr. Speaker.

MR. SPEAKER: A final supplementary, the hon. the Member

for Mount Pearl.

MR. WINDSOR: Will the Premier like to tell me now, then,

is this the way he proposes to build the economy, by giving great tax breaks,

$150,000 a year, retroactively, by passing retroactive legislation to deal with

Fortis, by passing retroactive legislation to overrule the courts so that

companies in this Province will not get the tax exemptions that the courts ruled

they were entitled to? Is this the way he proposes to do it? Does he propose to

do it, Mr. Speaker, by chasing away business people, who asked the Premier

directly if he is prepared to support an investment in this Province that would

create about 1,000 jobs? Is that the way he proposes to create jobs in this

Province?

MR. SPEAKER: The hon. the Premier.

PREMIER WELLS: Mr. Speaker, let me deal again with a

couple of points. Retroactive legislation: every now and then, it is necessary

to do something retroactively, like, Mr. Speaker, when we came to power, we had

to bring in legislation to retroactively approve the loans that the hon. members

put forward for Sprung that they didn't have the courage to bring to the House,

because they knew they couldn't justify it to the people of this Province. We

had to bring it in because of what that hon. member failed to do, Mr. Speaker,

because they didn't have the political courage to face the people and say: Here

is the $24 million that we want you taxpayers to pay. We had to go and get the

authority from the House and from the people of this Province.

Now, Mr. Speaker, there are times when retroactive

legislation is necessary and we had to do it.

AN HON. MEMBER: Overruled (inaudible) twice this session.

SOME HON. MEMBERS: Oh, oh!

PREMIER WELLS: Do you see what I mean, Mr. Speaker?

AN HON. MEMBER: Overruling the Province (inaudible).

PREMIER WELLS: The truth really gets him disturbed. There

is nothing as offensive to the hon. member as truth and he does his absolute

best to try to prevent it from being heard -

MR. SPEAKER: Order, please!

PREMIER WELLS: - including constant shouting like this;

and all of that, Mr. Speaker, really spells out the reality.

Now, Mr. Speaker, the government -

MR. TOBIN: (Inaudible) give it away.

PREMIER WELLS: Let the Member for Burin - Placentia West

- I will deal with him on that question.

MR. TOBIN: (Inaudible) sign (inaudible).

PREMIER WELLS: No, I wasn't. I will deal with him on that

question. When he has the decency to ask the question as a direct question I

will do it, but let's not divert from the real issue now. Let me answer the

question raised by the Member for Mount Pearl. Every time they don't like

answers, this is what they do, you get this shouting match to prevent the

answers from being given.

Now, Mr. Speaker, the government has laid out its Strategic

Economic Plan and it has taken certain steps with respect to it. I just

mentioned the business prospecting initiative that the government will be

undertaking. The Minister of Industry, Trade and Technology will be spelling it

out in considerably more detail. We have already taken steps with respect to the

reduction of corporate tax from 17 per cent to 16 per cent, small business tax

from 10 per cent to 5 per cent; the manufacturing and processing corporate tax

from 17 per cent down to 7.5 per cent. Those are incentives intended to do it.

There are others, Mr. Speaker, that are coming and the hon. members will stand

and pound their desks with pride at the action that the government is taking in

the future and I am looking forward to the day, Mr. Speaker.

SOME HON. MEMBERS: Oh, oh!

MR. SPEAKER: Order, please!

The hon. the Member for St. John's East.

MR. HARRIS: Mr. Speaker, my question is for the new

Minister of Works, Services and Transportation, who has taken over

responsibility for the fate of the King George V Building in St. John's East, a

building of historical importance and architectural significance.

One idea which I have suggested to the minister is that this

may be a proper site for the new federal community correctional centre that is

being established in St. John's East, and I would ask the minister, whether he

has had an opportunity to pursue that and whether he has any hope or expectation

that that is a possible use for that building, to refurbish it and make it

useful and save the building from destruction?

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

Transportation.

MR. EFFORD: Thank you, Mr. Speaker.

First, Mr. Speaker, we have called tenders for the sale of

the King George V Building. It was delayed somewhat because of the

accommodations that had to be made for a number of organizations around the

Province, but we have certainly given consideration to talking to the Federal

Government of the need for a correctional centre in downtown St. John's, and in

fact, just as early as yesterday afternoon, my deputy minister was ready to talk

to the people. Hopefully, that will work out to the satisfaction of everybody.

Certainly, we will encourage it to the best of our ability, and probably, within

the next week or two, we will be able to get more firm information and an answer

as to whether the federal government is really interested.

MR. SPEAKER: The hon. the Member for Ferryland.

MR. SULLIVAN: Thank you, Mr. Speaker.

I would like to direct a question to the Minister of Health.

I heard this morning on CBC a doctor saying there are being additional cutbacks

at the clinic in Grand Bank. This doctor essentially said that he cannot

practice medicine under the present conditions and it is about time that the

people said, `enough is enough'. Your government has already taken away the

cottage hospital and now the clinic will only have X ray services in the morning

and lab services in the afternoon. I ask the minister: Is this is the first step

in phasing out this clinic altogether?

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

DR. KITCHEN: Thank you, Mr. Speaker.

That hospital board had a certain amount of money on which to

operate this year.

MR. SPEAKER: Order, please!

I can't hear the hon. minister.

DR. KITCHEN: A certain proposal was put forward that

didn't seem to be acceptable to a number of people in the area and the hospital

board changed their methodology and did something else to save the money we had.

I have no apologies to make to the people of the Grand Bank area. Compared to

other parts of the Province, they are exceptionally well looked after as far as

health is concerned, Mr. Speaker.

Thank you.

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

Ferryland.

MR. SULLIVAN: Thank you, Mr. Speaker.

I ask the minister: Is it part of the government's plan to

take similar steps with other clinics across the Province?

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

DR. KITCHEN: Mr. Speaker, when the Budget is drawn up in

the Province and the amounts of money that can be spent by the various boards

are allotted, our policy is to stick to these amounts. Now, hospital boards put

forward a plan by which they will meet these fiscal objectives and if the plan

looks to our officials to be totally unacceptable, we discuss it with them, and

they may want to offer other suggestions. Eventually, something is worked out

that is the best we can do under the circumstances. That is how it is done. What

often happens, though, is that people uninvolved in the health care system

themselves - sometimes a council might get involved or somebody might kick up a

bit of fuss, like some hon. members opposite do in their areas, and they get

people all riled up about nothing; and then, that puts the hospital boards in a

very difficult position and they find it very difficult to manage because other

people are after them.

MR. W. MATTHEWS: (Inaudible) health care.

DR. KITCHEN: Mr. Speaker, if the hon. member wants to ask

a question later on when his time comes, he is welcome.

In the meantime, we are going to live within our budgets as

best we can in all the hospital boards. We are running into a difficult

financial crisis in the Province but, at the same time, our hospital system in

this Province is a model for Canada.

MR. SPEAKER: A final supplementary, the hon. the Member

for Ferryland.

MR. SULLIVAN: Thank you, Mr. Speaker.

I have a brief question for the Minister of Employment and

Labour Relations. Part of the curriculum in Grade V deals with an appreciation

of Newfoundland culture and it is very common for teachers to broaden the

horizons of children by taking them to the Newfoundland Museum, as part of that

culture broadening. It has been brought to my attention that a very disappointed

handicapped wheelchair person from my district could not participate in his

class trip because the Newfoundland Museum is not wheelchair accessible. I ask

the minister: What is he doing to ensure that essential public buildings are

made accessible to handicapped people when culture is part of the curriculum

here in this Province?

MR. SPEAKER: The hon. the Minister of Employment and

Labour Relations.

MR. GRIMES: Thank you, Mr. Speaker.

As hon. members opposite would know, any buildings in the

Province that have been built and erected since 1981 and beyond have had to

Province, but throughout the country. In all government buildings, as

renovations and modifications are being done, one of the things that is

happening as soon as it can - because there are a lot of public buildings

throughout the Province, many of them built before 1981 when these requirements

were not part of the code in Newfoundland or in the country. As they can be

brought up to standard the first thing that is being done to public buildings is

to make sure they are accessible. The Minister of Works, Services and

Transportation, who has overall responsibility for the public buildings in the

Province, has a list and they are being done as quickly as possible. And, as

modifications occur, according to budgetary allocations in any one year, one of

MR. SPEAKER: Question Period has expired.

Answers to Questions

For which Notice has been Given

MR. SPEAKER: The hon. the Minister of Employment and

Labour Relations.

MR. GRIMES: Thank you, Mr. Speaker.

I would just like to table the answer to the question that I

took under notice yesterday in terms of the Student Employment Program.

The basic information shows that there were 687 applications

received, with a request asking for 1,425 summer jobs. The criteria, the basic

calculations being done in the department, is to break the applications down by

work weeks requested; so there have been 17,079 work weeks requested in total.

The total funding requested has been $1,733,433, of which, of course, we have

$600,000 to try to meet the need. To date, up to yesterday when the question was

asked, there are 254 jobs currently approved, allowing for 2,061 work weeks, and

pending, ready to come to my office soon for signature, are another 161 jobs

which will provide for another 1,332 work weeks. All of it, I expect, will be

done by some time next week.

Finally, in response to the question, as well, Mr. Speaker,

this doesn't preclude, and never has precluded, people from hiring students.

These are just the ones that will get some subsidy from the government. I table

the information, Mr. Speaker.

Petitions

MR. SPEAKER: The hon. the Member for Fogo.

MR. TULK: Mr. Speaker, I rise to present a petition on

behalf of some 550 people in the three separate communities of Wings Point,

Clarke's Head and Victoria Cove.

Needless to say, Mr. Speaker, I support the petition and

would like to tell the hon. House that the amount of road we are talking about

here is relatively small but relatively important - very, very important, to the

three communities of Wings Point, Clarke's Head and Victoria Cove.

Mr. Speaker, for the ministers, and for those people in the

Legislature who are not familiar, the amount of road that we are talking about

here is approximately 3.0 kilometres. I think the Minister of Finance will be

familiar with it; he toured it this Spring.

There are three community roads off the Lewisporte loop road,

and because of the small amount - I know the government has, at this point in

time this year, committed most of its funds. Because there is this pavement

around this - the maintenance around this bit of road that is off those three

communities requires a different mode of operation for the Department of

Transportation. The roads, sometimes, in that area are not kept up to the

standard they should be.

Mr. Speaker, those roads are extremely rough in the Spring,

as the Minister of Finance is well aware. He drove over them in the worst part

of the year. I understand that the Minister of Works, Services and

Transportation will be looking at that district, as well - in the next couple of

weeks, I guess, Minister? We would hope that with the capabilities of those two

very fair gentlemen, and with them putting their efforts into getting this road

done, that, indeed, the prayer of this petition will be answered.

Mr. Speaker, I ask that the petition be placed upon the Table

of the House and referred to the department to which it relates.

SOME HON. MEMBERS: Hear, hear!

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

Transportation.

MR. EFFORD: Thank you, Mr. Speaker.

The one thing I want to say at the very beginning is that

this government and this minister have the total responsibility of approximately

8,400 kilometres of road within the Province.

AN HON. MEMBER: How many?

MR. EFFORD: Eight thousand, four hundred, I think is the

figure - that we are responsible for.

When you look at the amounts of money that we have to spend

each and every year in the Capital Works Program, approximately $25 million, you

have to understand that it has to be done on a priority basis.

The one assurance I can give the hon. the Member for Fogo is

that over the Summer months, being the new minister in this department, I want

to familiarize myself with the needs of the people around the Province and try

to get established on a priority basis what roads should be done under the next

Capital Works Program, and I will be attempting to visit as many areas over the

Summer months as I possibly can.

I can say that you will never find enough money to do all the

roads that need to be done.

MR. TOBIN: It is not going to be fair, I tell you that.

AN HON. MEMBER: He will be fair.

AN HON. MEMBER: We will be watching.

MR. EFFORD: I am sure hon. members opposite will be

watching, but we have to remember that for seventeen years, in a lot of

districts in the Province, the roads weren't done as well as they could have

been done. So, in order to be fair, you have to make sure that those roads which

were neglected for seventeen years are kept up to today's standards.

The intention is next year for me to be able to make

decisions based on priority. Because people in rural areas of the Province,

including Fogo, deserve to be treated as well as people living in any other part

of Newfoundland. So what I will say, Mr. Speaker, is that I will be visiting

over the Summer months as many districts as I possibly can, and I will make

decisions accordingly in the coming capital works program.

AN HON. MEMBER: (Inaudible) a fair list next year, I

guarantee you! (Inaudible) will be looking forward to next year.

MR. EFFORD: Fairness and balance.

MR. SPEAKER: Order, please!

The hon. the Member for Placentia.

MR. CAREEN: Thank you, Mr. Speaker.

I have no hesitation at all in supporting the petition from

the Member for Fogo. It is very important that people have good roads. I come

from a place that was Tory for years - in, for years, a Liberal district. One

tiny area was Tory, and they had to wait until the Tories got in, twenty-five

years after Confederation, to get a bit of pavement.

AN HON. MEMBER: (Inaudible).

MR. CAREEN: Yes. When they did start to pave, it was

during an election, and there were stables and children covered in. Anyway, I'm

here today, pleased to be able to support the member's area in getting a bit of

pavement. The tragedy is, with all the budgetary cuts over the past four years,

we are heading into the fifth year with more cuts and there are other people who

need roads done - always needing roads done. And I ask the minister, who is

supposed to be fair - I find we have to keep a close eye on the man. But anyway,

I hope you are successful over the Summer, Sir. We will be checking on this in

the Fall. Thank you very much.

Orders of the Day

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

MR. ROBERTS: Thank you, Mr. Speaker.

The consensus is that we should first ask the House to

address the third readings, which are Orders 3 through 13. With that done, we

will go on and do Committee on Bill No. 21, which is Order 16, the Financial

Corporations Capital Tax Act. We will take probably five or ten minutes on that,

I say to my friend from Grand Bank. There surely can't be very much that the

Opposition haven't said eighteen times.

When that is done, we will then deal with the rest of the

legislation, put it through its stages, and then get on to the Budget Speech. I

understand my friend from Placentia is going to make his maiden speech and,

depending on the result in the courts, it may be his departing speech. At least

it will be his first speech and we will look forward to hearing that. Then, we

will do the Supply Bill.

Mr. Speaker, if we could begin with the third readings.

MR. SPEAKER: Yes.

On motion, the following bills read a third time, ordered

passed, and their titles be as on the Order Paper:

A bill, "An Act To Amend The Workers' Compensation Act,"

(Bill No. 8).

A bill, "An Act To Amend The Schools Act," (Bill No. 9).

A bill, "An Act To Amend The Government Money Purchase

Pension Plan Act, The Public Service Pensions Act, 1991, The Teachers' Pensions

Act, The Uniformed Services Pensions Act, 1991, And The Memorial University

Pensions Act," (Bill No. 10).

A bill, "An Act To Amend The City Of Mount Pearl Act," (Bill

No. 18).

A bill, "An Act To Amend The City Of Corner Brook Act," (Bill

No. 17).

A bill, "An Act To Amend the St. John's Municipal Elections

Act," (Bill No. 19).

A bill, "An Act To Amend The Retail Sales Tax Act," (Bill No.

20).

A bill, "An Act To Amend The Teachers' Pensions Act," (Bill

No. 11).

A bill, "An Act To Amend The Insurance Adjusters, Agents And

Brokers Act," (Bill No. 16).

A bill, "An Act To Amend The Law Society Act," (Bill No. 24).

A bill, "An Act To Amend The Internal Economy Commission

Act," (Bill No. 23).

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

MR. ROBERTS: Your Honour, would you be good enough to put

the House into Committee of the Whole, please?

On motion, that the House resolve itself into Committee of

the Whole, Mr. Speaker left the Chair.

Committee of the Whole

MR. CHAIRMAN: Order, please!

Bill No. 21. The hon. the Leader of the Opposition.

MR. SIMMS: Mr. Chairman, I just wanted to make sure it

was the appropriate piece of legislation. We are quite willing to carry the bill

now, as soon as we get the answer to one small question.

AN HON. MEMBER: (Inaudible).

MR. SIMMS: Ask and it shall be answered, says the Member

for St. John's South.

I guess the question is directed to the Minister of Finance.

The Premier is not here. It is a follow-up to the question I asked in Question

Period, and I meant it quite sincerely because it is a question that has not

been asked, I say to the Minister of Finance.

AN HON. MEMBER: Has not been answered. It has been asked

often enough.

AN HON. MEMBER: (Inaudible).

MR. SIMMS: No, the answer was not given, I say to the

Member for Eagle River. Can the member -

AN HON. MEMBER: (Inaudible).

MR. SIMMS: Well, Mr. Chairman, I would be quite happy to

let the Member for Eagle River get up and tell us why that bill is retroactive

to last year. Can he explain it?

AN HON. MEMBER: (Inaudible).

MR. SIMMS: No? You cannot? Well then, Mr. Chairman -

AN HON. MEMBER: (Inaudible).

MR. SIMMS: The minister is ready to answer the question?

Great.

MR. CHAIRMAN: The hon. the Minister of Finance.

MR. BAKER: First of all, let me comment that the Leader

of the Opposition, in asking this question, used a word that really has not -

you cannot use that word to characterize the discussion on this bill, and that

word was `sincerity`, I believe. He sincerely wanted an answer. That word

`sincerely` does not characterize the type of debate that I have seen on this

bill at all.

Mr. Chairman, the answer was given in Question Period. The

bill was introduced last Fall. These were the dates that were on the bill last

Fall. That is a common occurrence in terms of tax bills, that there is a date

announced and the debate is done afterwards. As a matter of fact, most tax bills

that are passed in this hon. House are not actually passed until well after the

date of announcement, which normally is in a Budget Speech, so it is not

unusual. It is a common occurrence for tax legislation to have a small amount of

retroactivity. The bill was prepared last Fall and we just followed through with

the same bill.

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

MR. SIMMS: No, Mr. Chairman, that is not a satisfactory

answer. If the minister wanted to make the answer sound feasible, by saying the

bill was introduced last Fall and all that kind of stuff, can he tell me -

AN HON. MEMBER: (Inaudible).

MR. SIMMS: Yes, I could almost buy it, except for this

one little point, I say to the minister, and he should pay attention to the

point that I am trying to make and maybe it will help in the answer. I say to

the minister, I almost could believe what he had to say, except for this one

little point. He is trying to say it is because of last Fall, so we are just

reintroducing it and so on and so forth. The bill, last Fall, was introduced in

this House November 30, 1992 - November 30th. Why then is this bill retroactive

to take effect November 1st? Could he tell us that? This is the date - November

30th is the date -

AN HON. MEMBER: It was brought back up just before

Christmas.

MR. SIMMS: Second reading was not done, for example,

until December. This was November 30th when the bill had first reading.

AN HON. MEMBER: November 30th.

MR. SIMMS: November 30th is the day that the bill

received first reading - the bill, introduced in the House November 30th - but

this bill says it is retroactive, shall not apply to a corporation - blah, blah,

blah - come into force on November 1, 1992. Okay? So why is it retroactive to

November 1, 1992?

Can he answer this for me: Does it not, in fact, or in effect

now, offer this $150,000 tax break, or whatever the amount is, to Fortis now for

last year as well as for this year? Can he confirm that, and that in fact now

what we have done is give them $150,000 tax break for last year simply because

the bill was not passed last year in the Fall?

MR. CHAIRMAN: The hon. the Minister of Finance.

MR. BAKER: Mr. Chairman, the members opposite, sometimes

I wonder. Again, I will go back to what I said yesterday. I will just assume

that they don't understand and can't read the legislation and so on, so I'll go

over that again.

Mr. Speaker, the clause in contention here, Clause 2, simply

says that: "This Act shall be considered to have come into force on November 1,

1992...," okay? Now, they stop there. Members of the Opposition stop there. They

don't read any further. You can't do that to a piece of legislation. You can't

simply take half of a sentence and assume that that half of the sentence is the

operative

part in the legislation. That sentence goes on to say: "... but shall

not apply until the beginning of the next fiscal year after..." that date. Shall

not apply until the beginning of the fiscal year after that date. So if a

corporation, for instance, has a fiscal year that began in December, or January

or February, or that begins in June this month or July, and so on, that it will

not apply until the beginning of that next fiscal year after that date.

So it is meant to cover what's remaining in this year,

certainly. It's meant to correct the mistake in legislation and to correct it as

quickly as possible during this particular time. It's meant to correct it as

quickly as possible so that companies, when they come to the end of their fiscal

year - if their fiscal year doesn't begin till after November 1, okay, 1992,

then the end of their fiscal year is not till November 1, 1993. Which means that

that's the first consideration that would be give. So in actual fact a

consideration wouldn't be given until the end of that fiscal year, which is

still in the future.

Mr. Speaker, I don't know what the fuss is about. I wish hon.

members would read legislation properly before they get up and comment on it and

try to twist and turn and squirm and try to make something out of a situation

that does not exist.

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

MR. SIMMS: Mr. Chairman, I give the minister `A' for

effort. He tried to confuse the issue as best as he could because he really

doesn't know the answer to the question, and that's the difficulty here.

AN HON. MEMBER: (Inaudible).

MR. SIMMS: Can he tell us when the fiscal year of Fortis

Trust begins? Does he know that?

MR. CHAIRMAN: The hon. the Minister of Finance.

MR. BAKER: Mr. Chairman, I have no idea in the world when

the fiscal year of any company in this Province begins, let alone Fortis Trust.

That's precisely the point that I've been trying to make. Members opposite think

that this was done, perhaps written by Fortis Trust or something. That this was

done in consultation with these people. It was not. It was not done that way. I

don't know the year ends of any companies. I suppose it covers the spectrum. I

know the year end of the government. Members opposite don't seem - or there have

been times in history when members opposite have not recognised when the year

end came, because they've not brought in a budget before the year end dealing

with the next year. Some of the members sitting on the front bench there had no

concept of the year end of the Province.

I'm telling them, Mr. Speaker, that I know when the year end

of the Province comes, I know that. But I have no concept at all of when the

year end of Fortis Trust is.

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

MR. SIMMS: Mr. Chairman, if ever I heard a joke it was

just then by the Minister of Finance, accusing us of not knowing when the fiscal

year was. This is from the same minister and the same government that ever since

it's been in power brought in two budgets every year for the last four or five

years. Who can tell when the fiscal year is? He doesn't know.

That's all irrelevant. The fact of the matter is that there

is a point here of serious difference. Because there is suspicion. The minister

may say it wasn't done in consultation -

MR. W. MATTHEWS: The minister knows.

MR. SIMMS: - with Fortis Trust or anything, but - perhaps

the minister doesn't know.

MR. W. MATTHEWS: Yes, he knows.

MR. SIMMS: Perhaps he doesn't know if there was any

consultation with anybody in Fortis Incorporated, Fortis Trust.

AN HON. MEMBER: No idea.

MR. SIMMS: He has no idea. Now. He just said it there. He

has no idea. We have been hearing all kinds of rumours that may be there was

consultation with some members of the government, some members of the Cabinet.

That is the reason why there's been such a fuss on this piece of legislation.

Because for the life of us we cannot see why the government is so hell-bent and

determined to bring in this change in this piece of legislation which will

benefit only at the moment, one company, Fortis Trust, Fortis Incorporated,

which will be the company ultimately benefitting, so we have trouble

understanding that to begin with, but then, when you look at the piece of

legislation and you see that it is retroactive to last year, October 31,

November 1, effective and if their fiscal year is November or is December, then

they are going to get the benefit last year as well as in this year also. We

have every reason to be suspicious.

Now, let me make a suggestion to the Minister of Finance, who

would clear it up very quickly because, while he says that this is, you know, a

piece of legislation that was brought in last year and died on the Order Paper -

there have been lots of legislation over the years die on the Order Paper in the

Fall, and when it is reintroduced in the Spring session or the new session of

the Legislature later on, March, April, May or whenever, it is not all

retroactive to last Fall because the bill was brought in last Fall. Now the

minister knows better than that; that is a kind of a weak defence, so, there is

no reason in our minds for this bill to be retroactive to November 1st, but

since we have it this far in the process, why does he not just clear it all up

and say that the act shall be considered to come into force on, let us say June

1, of this year, if he follows what I am saying? In other words, make it current

not retroactive, because that suspicion will be there, that it is a little

favour being done for some company, only one company in this case as the

minister himself has admitted, who would benefit as far as he knows who would

benefit, so why should we not be suspicious, why should we not ask the

questions, why this legislation, this bill, this new bill, this is a new bill,

this is not last year's bill, it is a new bill so why is this new bill

retroactive to last November?

Simply because he had a bill similar to it last November does

not mean it should be retroactive, so make it effective June 1 of this year,

which is a reasonable time, a current period and then there will be no more

argument on the thing. I mean, we have argued all we can and said all we can say

without repeating ourselves, but if we could only get an answer from the

minister, I asked the Premier in Question Period today, I asked him why it was

retroactive and he tried to argue it and defend it until ultimately, the final

time I asked the Premier a question, he referred to the Minister of Finance, so

the Minister of Finance got up and -

AN HON. MEMBER: (Inaudible).

MR. SIMMS: You can answer it. You have not been able to

answer, you cannot answer, that is the problem, so - my friend here has been

trying desperately to get a word in. My friend is repeating what I am saying:

why are we making it retroactive to give them $150,000 -

AN HON. MEMBER: (Inaudible).

MR. SIMMS: No. - $150,000 last year as well as giving

them another $150,000 this year, that is what it amounts to, a $300,000 tax

break, so I say to the minister, we have every reason to be suspicious about

this. The people of the Province have every reason to be suspicious about this

because we have not been given a satisfactory answer to our question: why is it

retroactive? If you want to change it to June 1, then we can do that and agree

to it and get on with it, I will move an amendment if the minister wants to or

he can move it himself.

MR. CHAIRMAN: The hon. the Minister of Finance.

MR. BAKER: Thank you, Mr. Chairman.

I can accept the fact, as the hon. Leader of the Opposition

said that they are confused over there. I can also accept the fact as he stated,

that they are very suspicious. I can understand the suspicion because, in the

absence of knowledge there is always suspicion, Mr. Chairman. In the absence of

knowledge there is always suspicion, in the absence of understanding, there is

always suspicion.

Mr. Chairman, what we are doing here, is, correcting an

inequity and the members make the point that I had said in the Fall, I had said

last December that as far as I knew, there was only one company in existence

right now which fits that category we are talking about. Now, Mr. Chairman,

nothing could make the point better than that fact. The point is, that it is

under our tax system because of an inequity that was there and it was never

intended to be there, but an inequity that is there. It is impossible for small

trust companies to start and develop because our tax system had an effective

level of forty to fifty times more than we taxed the large companies. So, we are

saying: no, let us treat the smaller companies on the same basis as the larger

companies and allow small companies to be able to get into business and grow -

small trust companies. So, Mr. Speaker, we are trying to correct that. This is

not a tax break, it is a recognition of the fact that we as a government, and

the previous government who was part of this and so on and still existed under

that legislation, that governments have put a tremendous roadblock in the way of

development of small trust companies. It so happens that Fortis Trust is the

only one that I know of. There may be some others out there who have tried to

come into existence over the last number of years or that actually exists but I

only know of one, Fortis Trust, and that has become the topic of a lot of

discussion over the last six months here. Nothing could make the point better,

that it is impossible for small trust companies to develop and grow in this

Province because the large trust companies have a monopoly - because of our tax

system, we have given them a monopoly and we want to take that monopoly away to

allow the smaller companies to grow. Now, that is the essence of this Bill. It

is not what company benefits now - obviously there is a company that benefits

now. If there have been other companies that have started up in the last while

that I do not know about, they will benefit as well because - and maybe they

have because the notice had been given of this legislation in the Fall. Our

intentions were expressed very clearly in the Fall, we did not try to hide

anything, we are quite open about it and, Mr. Chairman, this particular bill

died on the Order Paper in the Fall.

The Leader of the Opposition makes the point: well that is

normal. Lots of bills die on the Order Paper and so on. Mr. Chairman, it is not

normal for this government. It was normal. I can remember one instance in a Fall

sitting when members opposite were sitting on the government side and there were

thirty or forty pieces of legislation sitting on the Order Paper and they all

died. Not one single one got through in the Fall sitting because they were

taking such a hammering in question period that they decided to close the House

and never hold a Fall sitting again. About forty pieces of legislation died on

the Order Paper that Fall because the Premier of the day got upset because of

the hammering that we were giving them in question period.

So, Mr. Chairman, it is normal for members opposite to leave

dozens, twenty, thirty, forty pieces of legislation on the Order Paper and let

them die because they wanted to scurry out of the Legislature with their tail

between their legs. They wanted to get out of here because of the vicious

hammering that they were taking during question period. So, Mr. Chairman, it was

normal than for legislation to die but it is not normal now. There are a couple

of pieces that we normally leave on the Order Paper to pick up again. I believe

this was because of a deal between the House leaders that this particular piece

of legislation was left on the Order Paper.

Mr. Chairman, what we are trying to do is correct an inequity

in the system. Members opposite can get up and rant and rave and play all the

politics they want with it but the fact remains, Mr. Chairman, that we must

correct this inequity. We are determined not to hide from this, we are

determined to go ahead with it and I guess that is all I can say to the Leader

of the Opposition.

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

MR. SIMMS: Mr. Chairman, I have to say to the Minister of

Finance, I do not know where his backbone is but he does not seem to be very

enthused about this particular piece of legislation. He seems to be letting

himself be pushed around by the Premier and the Minister of Justice. They must

be ramming it down his throat, that is the only answer I can give. He has turned

into a bit of a jellyfish over there, no backbone at all. I cannot understand

what is wrong with him or what is happening to him. It is very weak defence,

very, very weak defence. Oh, back five years ago there were bills left -I mean

all of that stuff has nothing to do with the question that I have been asking.

Why is it retroactive? A very simple question but I cannot get the answer. He

talks about: we are doing this to correct an inequity, to correct a mistake. Yet

in question period the Premier says: we are doing it because it is a new

initiative of this government to try to encourage investment. It is not a

mistake, it is not an inequity, it is a new initiative by the government to try

to encourage small trust companies and other businesses to come to Newfoundland

and Labrador.

DR. KITCHEN: You are against it.

MR. SIMMS: I am not against it. I say to the Minister of

Health that I am not against it. I am very strongly supportive of it. I say to

the Minister of Health that I support that initiative to encourage investment

and if that is the reason, why is it retroactive to last October? That is my

question.

AN HON. MEMBER: (Inaudible)

MR. SIMMS: Yes, to encourage them retroactively to last

October. Now, even the Minister of Health can see through this one. There is

something - what is that saying about the state of Denmark?

AN HON. MEMBER: There is something rotten.

MR. SIMMS: Something rotten, yes. There is something

rotten in the state of Denmark. I was going to say something fishy in the state

of Denmark.

Mr. Chairman, I guess we are at the stage in the debate where

there is not much left for us to do. If the minister and the government refuses

to answer our very clear question about retroactivity what else can we do? We

can try to stymie the debate, carry on discussion in the committee stage, try to

keep the House going until July or August. You can try all that stuff. We did it

in December successfully. In fact the government backed down and withdrew the

bill. There is not much else we can do about it at this stage except maybe move

an amendment and hope that the government will see fit to acknowledge the point

we are making, support the amendment, and clear this whole matter up right away

because I can assure the Minister of Finance that he is going to get the same

questions outside the House from the press and from the media, that very

specific question. They are going to say, Mr. Minister: if it is your intent to

make this change in order to encourage investment to come to this Province from

here on in, why do you need to make it retroactive to last October if it is not

to benefit Fortis Trust? That is the question the minister is going to have to

answer outside the House. I feel very certain that the press are going to ask

that question and I hope they have much better success than I did in Question

Period today, and we did as a party in debate on this Bill.

I am going to try and plead with the minister's conscience,

make one last attempt, by moving an amendment, which I am assured by the clerk

of the House is perfectly in order. I do not think the Chair will have to retire

or anything, but he may wish to. The amendment will be to move that

Section 2 of

the act be deleted. I think that is the right word I say to the clerk, be

deleted, and replaced with the following words, (2): this act shall be

considered to have come into force on June 1, 1993 but shall not apply to a

corporation until the beginning of its next fiscal year after May 31, 1993. Mr.

Chairman, do I need a seconder for that in committee?

MR. W. MATTHEWS: I second it, if you do.

MR. SIMMS: Mr. Chairman, I so move that amendment.

MR. CHAIRMAN: Is the House ready for the amendment?

The hon. the Minister of Health.

DR. KITCHEN: Thank you, Mr. Speaker.

I would like to have a few words on this amendment. I do not

know what the Leader of the Opposition and the other members of the Opposition

have against Newfoundland headquartered companies growing. In this Province we

need desperately pools of capital to develop our industries and one of the main

problems we have had over the years, and we all know we have had them, the basic

decisions of lending in this Province are not made in Newfoundland, they are

made in the corporate headquarters of the banks and the trust companies which

are in Toronto, Montreal, and sometimes Halifax. They are not made here.

What we are trying to do is to establish local trust

companies that will grow where the decision making power in that trust company

is in this Province, so that when companies go looking for loans, mortgages, or

whatever, they will be dealing with a trust company, a financial institution,

that understands the Province intimately, unlike the bankers sometimes in

Toronto or the trust companies in Toronto, Montreal and Halifax. What we need in

this Province are financial institutions that understand this Province, that are

of this Province, and that is the key point, I believe, that the hon. members

opposite are missing. Perhaps there may be some connection between the members

opposite and some of the mainland banks, I do not know.

Looking at the last leadership convention in Ottawa recently

you really wonder where the connections are. What connections do they have? I

believe what we should do in this Province is develop our local companies

because we must have pools of capital. Just as we gave the guarantee to credit

unions so that they can develop, we also must help local trust companies be able

to guarantee their deposits, which is what this thing does, thereby enabling

them to attract deposits from people in this Province at rates that are

comparable to what is being paid by others, and to develop good, profitable

financial corporations that can help the other corporations and the other parts

of this Province develop.

That's been a weakness in this Province going back for

centuries. We've never had the capital in this Province to develop. We're trying

to establish the means by which this Province can develop pools of capital, so

that they won't have to develop on the whimsical decisions of ACOA, or even on

our own Enterprise Newfoundland. These are good things too, but we must go

beyond depending on governments. One of the members opposite spoke this morning

to go. Because if a company goes for a loan guarantee they have to pay interest

at high rates. Very often, what's happening here, is that when you get loans

that are guaranteed, the companies very often have a great difficulty going

ahead.

What we have to have in this Province are large pools of

capital that can be lent, that can be invested. This Bill is a way. Now, the

reason this Bill is necessary: the details of the Bill are quite clear. What has

been happening is that in order to get the guarantee - all trust companies in

Canada are regulated by the Canadian Deposit Guarantee Corporation. They're

regulated in Ottawa. They're not regulated in Newfoundland, they're regulated in

Ottawa. Because they're regulated there - we in this Province don't guarantee

the deposits of trust companies because we don't control them. We have some

control over credit unions. We monitor credit unions in this Province and

therefore we have some confidence in giving guarantees to credit unions.

We don't have the same control over trust companies and

banks, because that is a federal responsibility. So we cannot guarantee deposits

through trust companies. What we can do is make the playing field level. In

order to develop a trust company in this Province, or anywhere else in Canada,

that will carry the guarantee that the deposit corporation gives, it must have a

paid up capital of $5 million.

A trust company starting off doesn't need to have $5 million

in capital. In these particular cases, in order to be a trust company, you have

to have $5 million in capital.

The banks, the large trust companies on mainland Canada, have

many millions of dollars of capital. Because they're so huge. Then they run

afoul with respect to our own capital tax. Our capital tax is I believe 3 per

cent on the paid up capital. Three per cent on the paid up capital for a bank is

very little, because all that's taxed is the amount of capital that's

proportionate to this Province, not on their total paid up capital. So when we

levy 3 per cent on capital it's not 3 per cent on the Bank of Montreal's

capital, it's only 3 per cent on that proportion which they have in the

Province, which is relatively small - and similarly, with respect to trust

companies.

But when we levy 3 per cent on a small company which is

forced to have $5 million capital which they don't really need, because they're

starting off, we tax them $150,000 right off the bat. That cuts into the

possibility of their being able to exist. For that reason we want to provide a

cushion so that they can go up to $10 million capital before the tax cuts in. We

believe that's a very fair way of handling it and that is why the Bill has been

brought in. We have been trying to bring it in for a number of years, but

finally the Minister of Finance very courageously brought this Bill before the

House. After having had it deferred at the last session, he is now bringing it

forward again, and I give him great credit for it.

Thank you, Mr. Chairman.

On motion, Clause 1 carried.

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

MR. HARRIS: Thank you, Mr. Chairman.

I wanted to join in the debate this morning because I have

heard a lot of commentary from the Minister of Finance, the former Minister of

Finance, and the Premier, talking about the development of pools of capital and

business in this Province. Well here we have a situation where this business we

are talking about promoting and developing was already set up. It was already

here - nothing designed to encourage this business to be set up. It was already

here. They knew the rules. I am sure they have the ability. They have the legal

advice. They have the financial knowledge.

They are doing so well with Newfoundland Light that they

decided to create Fortis, a reverse buy out, takeover, upside down finagle to

the Public Utilities Board, without the knowledge of the Public Utilities Board,

without the consent of the Public Utilities Board, without the consent of the

Legislature or the people of Newfoundland. They did this reverse takeover, sold

all the shares of Newfoundland Light to a company they created, Fortis Inc.,

which was not controlled,

whereas Newfoundland Light was, and so the cash cow,

Newfoundland Light, pouring money into Fortis Inc., at a guaranteed rate of

investment, to create a business to make more money, which is all very well. I

have no problem with that. I have no problem with them making money.

What do we do? They decide they want to set up a trust

company. Well that is all well and good. They set up a trust company, and I am

sure they read the Financial Corporations Tax Act. I am sure they read the rules

and regulations. I am sure they read the trust rules and regulations. They spent

two or three years doing it. They set up a trust company, and now it is here. We

are still getting this explanation that they have to have $5 million set aside

with which they are doing nothing.

Mr. Chairman, we have not seen any evidence of that. We have

not seen any of the rules about that. That money is all available, is placed in

capital producing, or interest producing deposits. It is available to them. They

may have to pay tax on it, but they also claim interest and they also get

interest earned on that money that may be in reserve, but it is a different

form. Monies not out in mortgages is in some other form of treasury bills or

something else.

To suggest that this is designed to encourage further

development of capital pools is ridiculous, because we have not seen any

evidence of anybody whatsoever, any other company, any other bodies interested

in this kinds of development. This is a one company arrangement here that is

being provided to benefit solely Fortis Trust, and that is what is wrong with

it.

They may as well have called it the Fortis bill. If they

wanted to just do this to come clean on it, they would have called it the Fortis

Trust bill, the Fortis Trust legislation. It is designed to assist this

particular company, because we do not have any other companies that qualify, or

any indication that any other companies or bodies are interested in this kind of

business.

If the government was truly interested in developing these

kinds of financial vehicles, we would see some action in the areas such as the

Province of Quebec has set up, and some other provinces are looking at the

solidarity type funds, the labour sponsored venture capital funds. We have not

seen that here yet.

We have yet to see any special arrangements made to ensure

that the pension funds of this Province are reinvested here. We have not seen

that yet. I know that the former Minister of Finance was interested in that, and

I have had a couple of discussions with him about that over the last couple of

years, but we have not seen any action on that. What we have seen is two

attempts, taking up a lot of House time because of the nature of the matters, to

deal with one special piece of legislation for one company.

So where are the plans? Where are the initiatives in the area

of maintaining or keeping the capital pools that we do have, the pension funds,

the Memorial University pension fund, the public service pension fund, the union

pension funds, many of which are invested outside this Province, Mr. Speaker.

The Member for Kilbride well knows that the pension funds that the construction

unions have developed over the years for their members, most of them, or many of

them, are even managed outside the Province, let alone invested outside the

Province. They're managed outside. They're managed in Toronto, in Nova Scotia.

They're invested outside the Province. In fact, they're controlled in many cases

outside the Province.

So we have no efforts and no initiatives to try and encourage

these pension funds to be invested here in this Province for the benefit of our

labour force, for the benefit of our people, for the benefit of our businesses.

We don't see anything like that. Why not? When are we going to see it? When are

we going to hear in this House something positive that's designed to encourage

these pension funds to invest their monies, their capital, the savings of

Newfoundlanders for their retirement, into this Province instead of having it

out in the world market or invested on the Toronto stock exchange, or invested

in real estate in downtown Toronto or New York or wherever it's invested?

I'm not saying that all pension funds or all monies, all

savings, the savings of the Member for Port de Grave, that it all should be

invested in Newfoundland. But it should be designed to encourage these pension

funds - in particular the pension funds - to maintain their capital pools and

investment in this Province.

That can be done through tax incentives to individuals, it

can be done through government facilitating the rules for that, but we don't see

any of that. All we see are specific one-shot deals in this case to look after

Fortis Trust. It's not presented as part of an overall scheme. Presented in fact

in a very devious way. Yet, still yesterday, members such as the Member for St.

John's South, getting up in this House and pretending that he's read through the

Act. He didn't see Fortis named anywhere in this Act. He didn't see any specific

mention of Fortis Trust. Trying to pretend to the people of this Province that

you can fool them by passing a piece of legislation and not mentioning the one

company that's affected by it, that's going to get $300,000 from the people of

Newfoundland when this Bill is passed today, $300,000! Not $150,000, but

$300,000 to cover last year -

AN HON. MEMBER: November 1, 1992 to November 1, 1993.

MR. HARRIS: To cover last year and this year.

AN HON. MEMBER: It's not $300,000.

MR. HARRIS: That's going to be $150,000 for each and

every year to come. We have seen people getting up in this House - government

back benchers getting up in this House - trying to keep up the pretence that

this is a piece of legislation designed for the overall benefit of all small

trust companies in Newfoundland, as if there were a number of them in this

Province. When we all know that there's only one trust company affected and this

is done at the request of this particular company.

I find it distasteful to continue to hear references to this

overall plan and scheme when we all know what it's designed for and what it's

done to help. And when we hear this same government, with the kind of attitude

that's expressed in its attempts to collect from this woman that the Member for

Humber Valley raised today, $629.17 for twenty years ago. Somebody may have -

and we don't know even whether they did - but they're now claiming an

overpayment from 1973. It's a wonder they haven't tacked interest on it for

twenty years and had it up to $3,000.

MR. WOODFORD: Living alone, blind, (inaudible).

MR. HARRIS: A widow woman, Mr. Speaker, living alone,

unable to see, being attacked by this government to the tune of $629 for

something that was a mistake that was made by the government twenty years ago.

Surely, surely there is something wrong with a government who with one hand is

lashing out $150,000 to one of the wealthiest companies in Canada, and on the

other hand is seeking to deprive a senior citizen of the amount of $620 for

something that was a mistake that government made over twenty years ago.

You know we hear all the time from this government, day after

day, week after week, every time an issue comes up with the people of

Newfoundland: just cannot afford it, we just cannot afford to meet every need

that comes by. The Premier gets up and he pontificates about how we, the people

of Newfoundland, the taxpayers, just cannot afford it, but, Mr. Chairman, if we

cannot afford it, we cannot afford to subsidize Fortis Trust. We should be able

to forgive an error that government made twenty years ago for a poor senior

citizen, we should be able to forgive that, but no.

The Minister of Forestry and Agriculture wants to talk about

the dairy industry. Well, he is lucky, Mr. Chairman, that this House is closing

today because we could have a discussion about the dairy industry in this

Province that would go on for several weeks, and a lot of information would come

out in this House about the dairy industry in this Province and the efforts that

the government has not made to support the dairy industry, and the actions of

the Minister of Forestry and Agriculture in destroying that industry.

He wants to double the amount of imported products into this

Province, he wants to double the amount of imported butterfat and imported milk

products to this Province at the expense of the growth of the dairy industry,

instead of working on a plan to make sure that the six employees, some of whom

are active in the reconstituted milk part of the business and the others who are

active in the fluid milk part of the business, and all of them could be easily

looked after, Mr. Chairman, but instead, no, no, we are going to make everybody

pay in that situation, meanwhile we will go out and we will attack this poor

woman in Western Newfoundland for a mistake that government made twenty years

ago to the tune of $629.

That is the kind of government that we have, Mr. Chairman,

insensitive to the real needs of people but quite sensitive, quite responsive to

the request of companies such as Fortis Trust to have the rules changed to suit

them because they have the influence, they have the power, they have the access

to the seat of government, they have the access to the Ministers of the Crown,

they have the access to the power and to the government and they -

AN HON. MEMBER: (Inaudible).

MR. HARRIS: Well, I say to the Member for Port de Grave,

and the Minister of Works, Services and Transportation, the people's House goes

on to record the statements of hon. members about issues of the day. We have a

large number of young people in the House today listening to the issues that are

before the House today and these young people, they missed Question Period, when

the Member for Humber Valley was asking about a mistake that the Department of

Social Services made twenty years ago, twenty years ago, and now are asking a

sixty-five-year-old woman to repay to the government $629 that was, they say,

overpaid to her husband twenty years ago. The man is dead for six years and they

are now asking his widow who lives alone, who is blind and who cannot understand

why the government is hounding her and at the same time today, in this House we

are being asked to pass a piece of legislation that gives a $150,000 a year

break to a friend of the government, Fortis Trust, the company who gathers

together all the money that they make from electricity.

Every person in this Province is contributing to the wealth

of Fortis Trust through Newfoundland Light and Power. All of this capital is

gathered together and now they have a trust company. Well, that is all very

well, they have a trust company and they should play by the rules. If they

wanted to see this changed as an incentive for them to get into business, well

than they should have proposed it a few years ago. They were planning to do it

but they could not do it unless they had a level playing field or some special

rules in place. Then you could say yes, it is an incentive but this company

decided to go ahead and establish knowing what the rules were. Maybe they knew

something that we did not, Mr. Chairman, maybe they knew that they could get the

rules changed to suit them by coming to this House and coming to the government

and saying: well, they are the friends of Fortis and we can expect them to

change the rules to suit us. That is what we are dealing with here this morning,

Mr. Chairman. I understand that the Opposition Leader has an amendment to make.

I do not know if it has been made yet or not -

AN HON. MEMBER: (Inaudible).

MR. HARRIS: It has been made. Well I certainly support

that amendment, Mr. Chairman, at the very least. I would rather prefer the

amendment that the Member for St. John's South seemed to be interested in - in

treating the legislation as one to encourage the development of small trust

companies by excluding the operation of this act from Fortis Trust and that all

new trust companies benefit from this legislation but if it is really designed

to assist small trust companies and encourage new trust companies to come to

Newfoundland, well then let them encourage new trust companies. We already have

one new trust company and let them encourage others by excluding Fortis Trust.

That is not a bad idea and I expect that the Member for St. John's South in this

committee, will move that amendment once we have dealt with the amendment of the

Member for Grand Falls, the Leader of the Official Opposition.

So, we have two amendments to deal with; the Member for Grand

Falls amendment and the Member for St. John's amendment, to exclude Fortis Trust

from the application of this Bill so that the true intention will be recognized

that this is designed to encourage new trust companies to come to Newfoundland.

That is the kind of thing that the government is into, they always have two sets

of rules. For example with Workers' Compensation, we have one rule for people

who are on before January 1st, 1993, we have another rule for people who are on

after January 1st, 1993. The people who are on after January 1st, 1993, will get

less from Workers' Compensation, the ones before that will get more. There is no

reason why we cannot have the same rule apply to Fortis Trust and to the other

trust companies. Any new trust companies who come on will get the benefit of

this rule, any existing ones will have to live by the rules that were in effect

when they started their businesses. They knew what the rules were, they knew

what the tax regime was and they set up, so let them live by the rules that were

in existence.

If the Member for St. John's South is right and this is

designed to encourage new businesses that would not otherwise be here, well then

let it apply to all the new ones. Let the people who are in business under the

rules, live by the rules that they went into business under, the same way as

Workers' Compensation, the same way as the government has decided to make new

rules for new people who are injured in the workforce today.

MR. SPEAKER: Order, please!

The hon. member's time is up.

MR. HARRIS: There is nothing wrong with two rules, Mr.

Speaker.

I guess I will have another chance when the Member for St.

John's South moves his amendment.

MR. SPEAKER: Order, please!

We are dealing with Clause 2 and in Clause 2 there is an

amendment, shall the amendment carry?

All those in favour, 'aye'.

SOME HON. MEMBERS: Aye.

MR. SPEAKER: Those against.

AN HON. MEMBER: Carried.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The amendment is carried.

SOME HON. MEMBERS: Division!

MR. CHAIRMAN: Division! Ring the bells.

MR. SIMMS: Mr. Chairman, on a point of order.

MR. CHAIRMAN: Point of order by the hon. the Member for

Grand Falls.

MR. SIMMS: What exactly is going on here now? There was a

vote -

AN HON. MEMBER: We are calling for division.

MR. SIMMS: Are you the Chairman?

MR. CHAIRMAN: Order, please!

MR. SIMMS: There was a vote called on the amendment, the

vote passed unanimously, in fact. There wasn't a `nay' vote cast. Three or four,

ten seconds later, one member stands up and calls for division. That's not the

appropriate -

MR. CHAIRMAN: The hon. -

MR. SIMMS: That's not the appropriate procedure.

SOME HON. MEMBERS: (Inaudible).

MR. SIMMS: That is not the appropriate procedure, Mr.

Chairman. Clearly the amendment was carried. There's no question about it.

MR. CHAIRMAN: Order, please!

MR. SIMMS: So I mean, this is going to be nothing other

than a charade by the government side, which has lost a vote, or else they

supported the amendment. I thought they supported the amendment, and that was

the reason why there was no reaction.

AN HON. MEMBER: Division.

MR. SIMMS: Well, there was no vote. You can't call

division five minutes after the bells are ringing. Mr. Chairman, I think that

this matter should be considered.

MR. CHAIRMAN: Order, please!

SOME HON. MEMBERS: (Inaudible).

MR. CHAIRMAN: Order, please! Order, please!

The Chair has called for division.

MR. SIMMS: (Inaudible) division.

MR. CHAIRMAN: The House has called for division.

MR. SIMMS: But they didn't. They didn't use the proper

procedure.

MR. CHAIRMAN: There were several members standing over

there.

SOME HON. MEMBERS: Oh, oh!

MR. CHAIRMAN: Order, please!

MR. SIMMS: One person over there then stood, one member

only.

SOME HON. MEMBERS: Oh, oh!

MR. CHAIRMAN: Order, please! Order, please!

The hon. the Member for St. John's East.

MR. HARRIS: A point of order, Mr. Chairman. The vote that

was taken, the Chairman of the Committee called for all those in favour of the

amendment, and there was quite a number of people who said `aye', and asked for

the `nays', and there was not one single member said `nay'. So the vote was

carried unanimously. The purpose of a division is to determine whether or not

the voice vote, and the Chair's calling of the voice vote, is accurate, when

there's some confusion about whether or not there are `ayes' or `nays', or what

the number of them are.

In this case there is no confusion. None whatsoever. There

was not one single dissenting vote to the unanimous support of that amendment. I

think, Mr. Chairman, you have to make a ruling as to whether or not a division

is possible when there's been a unanimous voice vote. There was an unanimous -

SOME HON. MEMBERS: Oh, oh!

SOME HON. MEMBERS: (Inaudible)!

MR. CHAIRMAN: Order, please! Order, please!

MR. HARRIS: Not one single dissenting vote. The Chair

called for the `ayes' and heard it, and called for the `nays' and there was not

one single `nay'!

SOME HON. MEMBERS: (Inaudible)!

MR. CHAIRMAN: Order, please!

MR. HARRIS: That's the first point, Mr. Chairman, on the

point of order. That it's not even possible to have a division when there's been

not one single dissenting vote.

SOME HON. MEMBERS: (Inaudible)!

MR. CHAIRMAN: Order, please! Order, please!

MR. HARRIS: And secondly -

SOME HON. MEMBERS: (Inaudible)!

MR. CHAIRMAN: Order, please!

The Chair has asked for order so that the hon. member can

present his point of order, please.

MR. HARRIS: Secondly, Mr. Chairman, when the division was

called for - and that's the important time - when division was called and asked

for, there was only member standing. The Minister of Health stood in his place

and said: division. There was not one other member standing when division was

called for.

SOME HON. MEMBERS: (Inaudible)!

MR. CHAIRMAN: Order, please! Order, please!

MR. HARRIS: Therefore a division is - for those two

reasons - Number one, there were no dissenting votes to count; number two, there

was no proper division called for in any event. Mr. Chairman, I ask the Chair to

make the ruling on both of those points.

MR. CHAIRMAN: Order, please!

MR. W. MATTHEWS: Point of order, Mr. Chairman.

MR. CHAIRMAN: The hon. the Opposition House Leader on the

point of order.

MR. W. MATTHEWS: Further to that point. I don't want to

reiterate what's already been said by the Leader of the Opposition and the

Member for St. John's East, but they are so correct. There was not a sound when

the Chair asked for those against the amendment - not a sound. I would suggest

to the Chair that you listen to the tape. That you recess and you listen to the

tape. As a matter of fact, Mr. Chairman, it was the quietest time that I've seen

this Legislature since I've been here when Your Honour asked for the `nays'.

There was not a sound.

The other point I want to make is yes, there was one person

who rose in his place, the Minister of Health, to ask for a division. When

everyone else realized that they had been caught, there were other members on

their feet, but they were not even in their own places. They were scrambling to

their seats when the Minister of Health asked for division. Those members who

were on their feet were making their way to their seats. They were not in their

proper places.

AN HON. MEMBER: (Inaudible)!

MR. W. MATTHEWS: The Member for Eagle River is one of the

guilty ones, I say to him. He's one of the guilty ones.

MR. CHAIRMAN: Order, please!

AN HON. MEMBER: (Inaudible).

MR. W. MATTHEWS: Rushing across the House!

MR. CHAIRMAN: Order, please! Order, please!

AN HON. MEMBER: (Inaudible)!

MR. CHAIRMAN: Order, please!

MR. W. MATTHEWS: So, Mr. Chairman, there's one way to

resolve this. There's one way to resolve it. It's very obvious that the

amendment has been upheld, it's been carried. There's one way to resolve it, to

prevent a kerfuffle here this morning, and that is for Your Honour to recess and

go listen to the tape. You will not hear one `nay' vote, not one.

MR. CHAIRMAN: The hon. the Minister of Finance.

MR. BAKER: Thank you, Mr. Speaker. I'd like to refer Your

Honour to Beauchesne, sixth edition, page 231, paragraph 815(1), which deals

with divisions in Committee. It indicates that any member of a committee - and

this is just to deal with one point that members opposite -: "Any member of a

committee may ask the Chairman for a recorded division either before the

question is put or following a division by a show of hands."

The argument they're making that only one stood up properly,

if in fact that happened, is not valid. Because it says: "Any member of a

committee may ask the Chairman for a recorded division either before the

question is put or following a division by a show of hands." So I'd refer Your

Honour then -

SOME HON. MEMBERS: (Inaudible).

MR. BAKER: I'll read it again for the Leader of the

member of a committee may ask the Chairman for a recorded division either" - the

operative work is either - "before the question is put or following a division

by a show of hands." So it only takes one request, Mr. Chairman, one individual,

to ask for a division.

However, Mr. Chairman, I should point out to Your Honour -

SOME HON. MEMBERS: (Inaudible)!

MR. CHAIRMAN: Order, please!

MR. BAKER: I should point to Your Honour that it's very

easy for members opposite to say that there was only one person that called for

division. If Your Honour saw other people standing, if it was obvious that a

division was called for, then Your Honour's decision will stand, of course.

There's no recording in House proceedings as to how many members are standing,

or where they're standing, or whether they're in their proper place, or whether

they're five inches beyond their proper place, Mr. Chairman. I'd like to simply

refer that reference to Your Honour for consideration.

I think it was obvious that the intent of members on this

side was to have a division call. The purpose of a division call is to

counteract the possibility where a few members, a minority of members, shout an

answer, a response, and the majority of members simply indicate a response. The

volume of sound in terms of a vote may go one way,

whereas in actual fact the

numbers of the vote may go another way. That's the purpose of calling for

division and it must be that way to avoid chaos in the House. Because if it were

not that way then members would always be shouting and screaming as loudly as

possible, and this would become a contest not in exercise of legislative

authority, but it would become a contest in who could shout loudest.

Mr. Chairman, I put to Your Honour that for the proper

functioning of this House we should proceed with the division.

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

MR. SIMMS: Thank you. Mr. Chairman, there are two things

here I want to point out. The reference that the Minister of Finance just passed

on to Your Honour talks about committees that sit in committee rooms in the

House of Commons and outside the House of Commons (inaudible). That's the

reference he's talking about when he's talking about paragraphs 812, 813, 814

and 815. So that is an absolute silly kind of reference to put to the Chairman.

It is not even relevant. We are talking about debate in Committee of the Whole

in this Legislature, by precedent, by Standing Orders, and by rules, and the

rules are clear, as they have been in the past. The other thing I want to point

out, Mr. Chairman, is that the Minister of Justice, who has declared in this

particular case that he has a conflict of interest, still communicated with the

Minister of Finance, sending up a note to him on how to deal with this matter

and how to deal with the debate on this particular point of order. Now, there is

something wrong with that. That surely is not proper either, so we are all going

to play this properly ,and if we are not going to play it properly I suggest and

recommend strongly to Your Honour that you recess for a few minutes, listen to

the tape of the proceedings, you look at the rules and the precedence that we

followed in the past. In this instance they were caught with their parliamentary

pants down once more. They were caught asleep and they did not know what had

happened to them. Now, that is exactly what happened to them and the amendment

was carried. In my view it was an excellent amendment anyway.

I thought the Minister of Finance had agreed to accept it and

that is the reason why there was no vote against the amendment. I suggest to

Your Honour that would probably be the wise way to proceed here and I think when

you do that you will find very clearly that the government lost the amendment.

We won the vote on the amendment and we should get on with the next item of

business.

MR. CHAIRMAN: The hon. the Member for Mount Pearl.

MR. WINDSOR: Just to add to what my friend the Leader of

the Opposition said, Mr. Chairman. Clearly, as we know, without any question,

the Standing Orders of this House govern. Only when there is no Standing Order

to cover a particular question do we then refer to Beauchesne or to anything

else. I refer, Your Honour, to Standing Order 82 (

e) which clearly states the

same procedure for a division in the House shall be followed in the Committee of

the Whole. I tell, Your Honour, we are in the Committee of the Whole. Our

Standing Orders are very, very, clear. Tradition and precedence in this House is

very, very, clear, so are the rules we must follow.

SOME HON. MEMBERS: Oh, oh!

MR. CHAIRMAN: Order, please!

The hon. the Member for Mount Pearl.

MR. WINDSOR: Thank you, Mr. Chairman.

I have all weekend. I am in no hurry to get out of here. Let

me repeat. Standing Order 82 (

e) is very clear, that the same rules of procedure

for division in the House shall be used in Committee of the Whole. Now, for the

hon. Minister of Finance to stand up and refer to some obscure

section of

Beauchesne that refers to committees outside the House of Assembly is utter

foolishness. It is very, very, clear. Standing Order 82 (

d) says, 'the Yeas and

Nays shall not be entered upon the Minutes unless demanded by three Members."

Clearly there were not three members standing - and the bells shall ring for not

more than ten minutes, Mr. Chairman. It is very clear there were not three

members standing. The point my friend for St. John's East made is also a very

valid point. How can you have a division when there was no dispute? It was

unanimous in the House, Mr. Speaker. The verbal vote was unanimous. How can you

divide something that is unanimous? The point is that we certainly do follow the

rules that are applied in the House. The point brought up by the Minister of

Finance is nonsense.

MR. CHAIRMAN: If there are no further submissions the

Chair would like to recess for awhile and deal with this matter.

RECESS

MR. CHAIRMAN: Order, please!

To the point of order raised by hon. members, that the

division was not in order. Re the call by the members for division on the vote,

the Chair has reviewed the tapes and from that review the Chair clearly put the

amendment and asked for the `ayes' and then there was a pause and then the call

for the 'nay' vote, there was another short pause and then the Chair declared

that the amendment was carried. Immediately following that call, there was a

call for Division from several members on the government side, the tape clearly

indicates that and then the Chair asked for the bells to ring and called

Division. The precedent of course in this House, as the hon. Member for St.

John's East, raised a point concerning the fact that there was unanimous

consent, but the precedent in this House, on several occasions particularly on

the Private Members Bills, where it had appeared that the voice vote was

unanimous, there were calls for Division, so clearly, a call for Division

following any voice vote is in order and the Chair declares that Division is in

order and the Chair calls for a Division. Ring the bells.

Division

MR. CHAIRMAN: Is the House ready for the vote?

All those in favour of the amendment, please rise:

Mr. Matthews, Mr. Tobin, Mr. Woodford, Mr. Windsor, Mr.

Hodder, Mr. Byrne, Mr. Shelley, Mr. Careen, Mr. Harris.

MR. CHAIRMAN: All those against the amendment, please

rise:

The hon. the Minister of Forestry and Agriculture (Mr.

Flight).

MR. WINDSOR: The Minister of Social Services was not in

his place, Mr. Chairman, when the question was put.

MR. CHAIRMAN: Order, please!

MR. WINDSOR: The Minister of Social Services cannot

(inaudible).

MR. CHAIRMAN: Order, please! Order, please!

All those against the motion, please rise:

The hon. the Minister of Forestry and Agriculture (Mr.

Flight), The hon. the Minister of Works, Services and Transportation (Mr.

Effort), The hon. the Minister of Social Services (Mr. Lush), The hon. the

Minister of Municipal and Provincial Affairs (Mr. Reid), The hon. the Minister

of Finance (Mr. Baker), The hon. the Minister of Fisheries (Mr. Carter), Mr.

Barrett, Mr. Murphy, The hon. the Minister of Mines and Energy (Dr. Gibbons),

The hon. the Minister of Health (Mr. Decker), The hon. the Minister of Tourism

and Culture (Mr. Walsh), The hon. the Minister of Environment and Lands (Ms.

Cowan), Mr. Noel, Mr. Tulk, Mr. Ramsay, Mr. Penney, Mr. K. Aylward, Mr. Langdon,

Mr. Oldford, Mr. Dumaresque, Mr. Gilbert, Mr. Whelan, Mr. Smith, Mr. Matthews,

Dr. Hulan.

MR. CHAIRMAN: Order, please!

CLERK (Mr. Noel): Chairperson, nine in favour of the

motion and twenty-five against the motion.

MR. CHAIRMAN: The Chair declares the amendment defeated.

MR. WINDSOR: On a point of order, Mr. Chairman.

MR. CHAIRMAN: The hon. the Member for Mount Pearl, on a

point of order.

MR. WINDSOR: Mr. Chairman, not to delay the issue, I do

not wish to belay the point, I simply want to clarify the point that when the

question was put, the Minister of Social Services was not in his place, he was

standing behind Your Honour. Standing Order, 82 (c), clearly states: "No member

shall be entitled to vote in any division unless he was in his place when the

question was put." The member was not entitled to vote. I simply want that

recorded for the record, Mr. Chairman, so that we do not sleep on our rights on

it.

MR. CHAIRMAN: Order, please!

My understanding is that when the vote was put, the hon.

member was not in his place, is that what -

MR. WINDSOR: He was behind Your Honour putting your

Hansard back on your desk.

AN HON. MEMBER: What? He was here when the vote was

called.

MR. WINDSOR: No he was not.

SOME HON. MEMBERS: Oh, oh!

MR. CHAIRMAN: The hon. the Minister of Social Services.

MR. LUSH: Your Honour, I was returning a document to the

table and to the Chair and just as I put the book on the Chair I think they

called for the vote. If that is against the rules - my understanding is that if

a member is inside the Bar of the House, is inside the Bar, he is not permitted

but if that is so I am not going to - I will have my name wiped from the vote.

AN HON. MEMBER: No, I would not.

MR. CHAIRMAN: Order, please!

Motion, that the Committee report having passed the bill

without amendment, carried.

On motion, that the Committee rise, report progress and ask

leave to sit again, Mr. Speaker returned to the Chair.

MR. SPEAKER: Order, please!

The hon. the Member for Trinity - Bay de Verde.

MR. L. SNOW: Mr. Speaker, the Committee of the Whole have

considered the matters to them referred, have directed me to report Bill 21

carried without amendments and ask leave to sit again.

MR. SPEAKER: The Chairman of the Committee of the Whole

reports that it has considered the matters to it referred and has directed him

to report Bill No. 21, carried without amendment. When shall the report be

received?

MR. ROBERTS: Now, Mr. Speaker.

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

MR. ROBERTS: Mr. Speaker, before we call third reading,

just to ensure that childishness does not take over from common sense, I move

that the House do not adjourn at noon.

MR. SPEAKER: If the Government House Leader could repeat

that? You want to put the motion to adjourn -

MR. ROBERTS: Mr. Speaker, I move that the House do not

adjourn at noon.

MR. SPEAKER: Oh, do not adjourn, I am sorry, okay.

The motion is that the House do not adjourn at noon.

All those in favour of the motion, 'aye'.

SOME HON. MEMBERS: Aye.

MR. SPEAKER: Those against, 'nay'.

SOME HON. MEMBERS: Nay.

MR. SPEAKER: Carried.

I say with caution, the vote carried.

The hon. the Government House Leader.

MR. ROBERTS: Mr. Speaker, third reading of Bill 21.

On motion, a bill, "An Act To Amend The Financial

Corporations Capital Tax Act", read a third time, ordered passed and its title

be as on the Order Paper. (Bill No. 21).

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

MR. ROBERTS: Mr. Speaker, Motion 1, which is the Budget

Debate, I understand that my friend for Placentia wishes to speak and we will

gladly listen to him. I understand there will be no other speakers but that is

up to members who have not spoken yet. Could we call Motion 1, please?

MR. SPEAKER: Yes, before calling Motion 1, I would like

to welcome to the public gallery thirty-five students from Holy Redeemer School,

Spaniards Bay. I believe they are accompanied by their teachers, Mr. John Drover

and Ms. Jeannette Pottier.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: Yes, Motion 1.

The hon. the Member for Placentia.

SOME HON. MEMBERS: Hear, hear!

MR. CAREEN: Thank you, Mr. Speaker. I have been here for

this past number of days and while there is sort of a honeymoon going on, I was

a bit sidetracked -

AN HON. MEMBER: A honeymoon?

MR. CAREEN: Yes, a honeymoon. Some people on a honeymoon

tend to forget some of the other aspects that are going on. Today it came

jumping back, the reason why I ran in Placentia and the reason why the people of

Placentia District put in a PC.

Mr. Speaker, I am both proud and humbled to be able to take

elected to the House of Assembly of Newfoundland, and he had something in common

with my little friend for St. Mary's - The Capes, because we share a common

ancestry.

AN HON. MEMBER: Little?

MR. CAREEN: Yes, little. Compared to me you're little.

This House is our house. It's the seat of democracy in this Province. It's too

bad other people who live within our districts cannot for a short period of time

at least partake in what we go through here, right or wrong or luke-warm, or

whatever we try to do on times.

Today I will talk about my home. Not the home I was born in,

in Point Lance, St. Mary's Bay, or the one I was raised in in Placentia when we

moved there in 1951. Nor the residence I maintain in Jerseyside since I got

married some twenty-odd years ago. My home now is the district of Placentia, the

area between Southern Harbour and Point Verde.

I would like to extend congratulations, before I proceed, to

all members who were elected and re-elected. To the Premier: a large

responsibility has been put back on his shoulders. I will ask him to temper

decisions with compassion, because we find ourselves in a bad position. To the

Leader of the NDP: while his numbers are not the same as others, he shares a

great responsibility. To the Leader of the Opposition, the man from Grand Falls,

who has been a great coach to me since I came here, and a great support.

I would like to extend a sincere thank you to the supporters,

the dedicated volunteers who helped me get elected in the district of Placentia.

You can't pay volunteers, you can't pay people who come in 9:00 p.m. and have to

driven home 12:00 a.m. or 1:00 a.m. in the morning to get rest. They can never

be replaced. I would like to extend congratulations to the workers of the other

candidates in our district who tried to get their candidates elected.

Time is going on. It's not my intention to keep anybody long.

Our area -

AN HON. MEMBER: You won't be here long.

MR. CAREEN: No? You'll be back here in October and you'll

see me, mister. I'll be like General MacArthur and I shall return.

AN HON. MEMBER: Hear, hear!

MR. CAREEN: Our area over the years has had numerous

setbacks, but for decades before that they had contributed very much to the

Newfoundland economy. What with the base at Argentia for instance, where people

from all over the Avalon had to work there, or people from other parts of the

Province. Since the late 'sixties and early 'seventies, with the phase down of

Argentia, we find ourselves in a bad light. The present provincial Minister of

Fisheries was on our side then and the Member for St. john's West knew what we

were going through. We have not recovered. Now we're facing a closure in

Argentia in October of 1994 that will put 265 people out of work, which will

take $7.5 million in salaries alone from the area economy. That does not include

small contractors that constantly work there. With the federal and provincial

governments there are teams of people working together to rectify some of those

matters.

Long Harbour and Mount Arlington Heights. My friends have not

recovered either. At the present time the company Albright and Wilson is looking

at containment. Containment to me, sirs, at this times, is not good enough. The

only thing I will say here is that Albright and Wilson should be contained to do

the job properly, and the clean up that should be done down there in Long

Harbour.

SOME HON. MEMBERS: Hear, hear!

MR. CAREEN: I had the privilege of sailing around this

Island lots of times. I was fifteen years with CN in the marine services. I've

seen a good many portions of this Island and I can respect members opposite or

on this side when they talk about their different areas. Because I was there. I

know. I respected the man - the recent member elected from Torngat when he

talked about the things that he felt ashamed of when he was small, and when he

grew up and stood on his hind legs to say that what he was he was proud off.

Ladies and gentlemen here and on other parts of this island

we have to stand together. I had the occasion of being with the railway for

years and when I went ashore I spent thirteen years with the Rural Development

Association. The Premier in the opening of this House talked about building

blocks, talked about putting blocks one on top of another. Well, we and other

development associations have been trying it for years. While you try to get

people to work you try to take numerous ideas, twirl them around and try to put

shores to support what you are at. Largely the things you find yourself doing

are lost when you have five jobs and you get 100 names and the dedicated

volunteers and the people they got employed there are just constantly maligned,

but that is the territory we are in and you have to keep on going.

I always salute those people of volunteer status. The

Community Futures, the Placentia Area Development Association, was largely

responsible for gaining access to get community futures into our area. That has

taken on a new role and it looks like community futures might be usurping the

role of the development associations. Some people out there cannot see the

difference but there is a difference. There is a large difference between what a

small area development association is doing and what larger community futures

groups, largely made up of the same people, are doing. From the development

association, community futures, and other groups, we formed the Argentia

Development Corporation to take a pro-active stand on Argentia. We have gotten

monies to do a study on the assets that are there. There are many ideas being

generated at present.

ACOA put in 100 per cent of the funds, $200,000, and there is

a mixed team of management from the Province, from the local area and from ACOA,

and it is the intention of our area that Argentia, when the Americans leave,

should be under local control and management. I say to this hon. House today

that I was there when these decisions were made and my place today is no

different than it was then, we will have to look after ourselves, and look after

ourselves we will. Some ideas we are after are procurements. The Canadian

military spend a lot of money still south of the border getting repairs and

maintenance to equipment. Nova Scotia's per capita spending by the Department of

National Defence far outruns what they spend in Newfoundland, and with the

meetings, federal and provincial, we will close the gap on that because Argentia

with its facilities can certainly make up for any lack of opportunities that we

had before.

They have found out in the United States that when bases

close and the people and the governments take a stake, it is always about 85 per

cent better than it was with the American forces there. You have all heard it

before, across the floor and in the media, that the best port in Newfoundland is

in Argentia. It is ice free and being used by a couple of companies and by

others on an alternate basis. The Americans came to Argentia because it was the

best base and we will use that as the best base to spearhead the economy for

Eastern Newfoundland, if done properly by all of us and all our departments. We

have to put people to work and wherever they are from they have to benefit. We

are not selfish out our way. We are not selfish by any means. It is Newfoundland

for Newfoundlanders and Labradorians.

At this time I would like to extend an invitation to the

Premier and his Cabinet to come down to our area for at least one meeting over

the Summer and allow some of the groups and individuals to meet him and make

briefs on behalf of the people in Argentia, and also the people in Long Harbour

or anywhere within the district, and also because it is quite close to my little

buddy from St. Mary's - The Capes. I extend an invitation, if you would kindly

take us up because we are on hard times and potentially, we are getting on worse

times, and it would be a great boost for the prime members of this government to

be able to visit our area and share our ideas.

Our area, ladies and gentlemen, you are all familiar with

tourism, you are all familiar with the beautiful district we are from, Placentia

particularly. I mean when you look at Placentia from the height of Castle Hill,

you wonder what God could have done if he had money. There are many things in

our history on which to draw. The natural landscape to draw on, the things to

improve on. Castle Hill has had some minor improvements since it was done in the

mid-70s, and that needs to be further infused with money to develop it properly.

Fort Louis at the bottom of the hill, was most important back in the days of the

is where the governors, the police and everybody else lived there who had to

keep the economy going. We have to improve on all our services.

Ship Harbour, the site of the Atlantic Charter meeting with

Roosevelt and Churchill has to be improved. Fitzgerald Park - I was talking to

the minister a couple of weeks ago and while the agreement was signed two years

ago to have improvements done on Fitzgerald Park, engineering work has been done

but site work has yet to be started and it looks like it will not start until

next year, which is too bad because the improvements and also the work are

desperately needed.

Fisheries, we have plants closed; we had a plant close in

Argentia three years ago, because this government would not put $75,000 into one

of their own buildings to repair the roof. The Jerseyside plant is closed, the

Development Association owned it and a lot of people say Development Association

should not be involved in fish plants, but we scrounged money anywhere we could

and we never ran the plant and we have tried to lease it to operators to put

their best foot forward, but that was not always the case I am sad to say, but

there is a freeze on that plant, a freeze sad to say, that is keeping people

unemployed who want to go to work with fish leaving our area.

Ladies and gentlemen, this year we will finally see some

improvements in health care, in a facility that tenders should be out on shortly

in Placentia, for the start of a new hospital up by Lions Manor to replace the

hospital built by the Commission of Government years ago. The health care

(inaudible) got a big kick in its backside a couple of years ago with the Budget

this government brought down, but hopefully, we will see improvement in health

care when the two phases are