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May 11,

RESOURCE

COMMITTEE

Pursuant to Standing Order 68, Steve Crocker, MHA for Trinity Bay de Verde,

substitutes for Sam Slade, MHA for Carbonear Harbour Grace.

Pursuant to Standing Order 68, Stelman Flynn, MHA for Humber East, substitutes

for Christopher Mitchelmore, MHA for The Straits White Bay North.

Pursuant to Standing Order 68, Glenn Littlejohn, MHA for Port de Grave,

substitutes for Tracey Perry, MHA for Fortune Bay Cape La Hune.

Pursuant to Standing Order 68, George Murphy, MHA for St. John's East,

substitutes for Lorraine Michael, MHA for Signal Hill Quidi Vidi.

The

Committee met at 9:00 a.m. in the Assembly Chamber.

MR. CROSS:

Good morning everyone. I think the

light is on and we are ready to proceed.

Welcome

to the Estimates on Business, Tourism, Culture and Rural Development.

In your books it is

section 10.

I am sure you already have the pages creased and ready to go.

Just a

couple of words of housekeeping we need to straighten away.

We need a mover and seconder for adopting the minutes of the last meeting

of the Resource Committee which was May 7, 2014.

Mr.

Littlejohn moves; seconded by Mr. Crocker.

All

those in favour, 'aye.'

SOME HON. MEMBERS:

Aye.

MR. CROSS:

Carried.

motion, minutes adopted as circulated.

MR. CROSS:

One other little thing just

to add before we start this morning, we have some replacements.

Mr. Crocker is replacing Mr. Slade, Mr. Flynn is replacing Mr.

Mitchelmore, Mr. Littlejohn is replacing Ms Perry, and Mr. Murphy will replace

Ms Michael. We have four stand-ins

this morning. The regular members

are here. They will introduce

themselves in a moment.

well, we have been informed that there is a small glitch in the Broadcast

Centre. With their viewing system down there today, the bank of people on the

last

section on that end may not be able to be fixed until lunchtime.

So whenever someone in that gallery speaks, either the minister or I

would need to identify them so they turn on the appropriate mic.

If the minister deflects to someone down that way, then he could just

mention who he is asking and then the light would come on.

I would

ask, as we start now, for Opposition members and government members to identify

themselves as their light comes on.

MR. FLYNN:

I got the light.

Stelman Flynn, Humber East for tourism.

MR. CROCKER:

Steve Crocker, Trinity Bay

de Verde

MR. SIMMS:

Randy Simms, Researcher.

MR. MURPHY:

George Murphy, MHA for St.

John's East.

MR. MORGAN:

Ivan Morgan, Researcher.

MR. LITTLEJOHN:

Glenn Littlejohn, MHA, Port

de Grave.

MR. HUNTER:

Ray Hunter, Grand

Falls-Windsor Green Bay South.

MR. MCGRATH:

Nick McGrath, MHA, Labrador

West.

MR. CROSS:

Okay, Minister, do you want

to introduce your crew or the individuals

MR. KING:

We can go across.

Darin

King, Minister.

MS MURPHY:

Carmela Murphy, Assistant

Deputy Minister, tourism, culture and heritage.

MR. O'RIELLY:

Alastair O'Rielly, Deputy

Minister.

MR. PLOUGHMAN:

Mark Ploughman, Assistant

Deputy Minister for Innovation and Strategic Industries.

MR. JANES:

Glenn Janes, CEO, Research & Development

Corporation.

MR. BLANCHARD:

Larry Blanchard, Chief

Operating Officer, Research & Development Corporation.

MR. GRIFFIN:

Pat Griffin, Director of R &

D Policy with RDC.

MS HUMPHRIES:

Donna Marie Humphries,

Director of Finance, The Rooms Corporation of Newfoundland and Labrador.

MS MUNDON:

Tansy Mundon, Director of

Communications.

MR. GENGE:

Daryl Genge, Assistant

Deputy Minister, Trade and Investment.

MS SKINNER:

Gillia n Skinner, Director of

Regional Economic Development.

MR. REID:

Derick Reid, EA to Minister

King.

MR. CURTIS:

Ken Curtis, Departmental

Controller.

MR. JOHNSTONE:

Terry Johnstone, Director of

Policy and Strategic Planning.

MR. CROSS:

Okay.

We ask that everybody on this side identify themselves by name if you are

speaking or the minister deflects to you.

For the people in the far section, then the minister would identify who

he requests to speak to answer a question or make comment.

I guess

we will start off. We will offer

the minster a few moments as introductory.

MR. KING:

Thank you, Mr. Chair.

Good

morning everyone.

What I

would like to do, by way of request, is split this up a little tiny bit and

perhaps start with the Research & Development Corporation, if that is okay.

These guys have no connection to the rest of the department and it allows

them to leave.

could probably then move into The Rooms.

Our CEO is on his way, Dean, if he is here.

If not, we can divert that.

Otherwise, if the Committee is good with that, I would like to start with the

Research & Development Corporation.

MR. CROSS:

Okay.

We will start and we will use fifteen-minute intervals on the clock; for

the person fifteen and ten successive.

recognize Mr. Flynn. Mr. Crocker is

going to go first. Okay.

MR. CROCKER:

One second.

The minister threw me a curveball.

MR. KING:

Section 9.1.01.

MR. CROCKER:

I guess my first question on

it would be the budget of the $21.9 million from the last year's budget which

was $22,026,000. Could the minister

give us a breakdown of what that money was used for; the loans, the subsidies,

who received monies?

MR. KING:

Sure.

The revised budget of $22,026,000 would have had a number of items.

Salaries would have been about $4 million; benefits, $852,000; travel and

communications, $139,000; Supplies would be $109,000; Professional Services,

$1.03 million; Purchased Services, $1.2 million; $272,000 for Property,

Furnishings and Equipment; and R & D programs and solutions, $17.8 million.

MR. CROCKER:

Minister, do you have a copy

of the breakdown that we could have, because it is not broken down.

MR. KING:

Yes, well I just read it

into the record, so Hansard will give it to you now.

MR. CROCKER:

Okay.

I think you said a little over $1 million for Professional Services.

MR. KING:

Professional Services,

$1.034 million.

MR. CROCKER:

Could you provide us with a

breakdown, at least, of the Professional Services that were outsourced, I am

assuming, for the Research & Development Corporation?

MR. KING:

Sure.

Market alignment analysis, we would have spent $60,000; Office of the

Chief Information Officer, support and infrastructure technology, $111,000; and,

$560,000 would have been to consultants, R & D Solutions, strategic

opportunities.

MR. CROCKER:

The $56,000, Minister, where

was that again in Professional Services, or who was it to?

MR. KING:

Glenn Janes, can you

elaborate a little on that, please?

MR. JANES:

The $560,000 breakdown is for a number of different things, but they are looking

at specific opportunities. In one

instance, (inaudible), which materialized in terms of there is now a corrosion

facility in Argentia that is being partnered with NASA, as well as some of the

offshore operators.

There

are other projects that are targeting similar things, deep-water opportunities

that would look at solutions that are needed for challenges in deep-water

operations off this Province. So

there are three or four collections of consultant-specific targeted work

targeting opportunities and needs of the Province.

The

best example among those would be the corrosion one that is already culminated

in a facility in operation.

MR. CROCKER:

Okay.

Could

the minister tell us the number of staff at the Research & Development

Corporation?

MR. KING:

Glenn, I know you know

quickly, thirty

MR. JANES:

There are thirty-six and a half full-time equivalences.

MR. CROCKER:

Are there any vacancies?

MR. JANES:

Yes , there are.

MR. CROCKER:

Where would the vacancies

be?

MR. JANES:

There are primarily two areas of vacancies.

We have account managers, which assist in the project administration, but

the balance of our vacancies are in new opportunities that would be emerging.

We will not fill those until they reach critical thresholds.

We are developing some opportunities.

There is provision to staff those if and when they reach critical

milestones.

MR. CROCKER:

The money is budgeted to

staff those positons?

MR. JANES:

Correct, yes.

MR. CROCKER:

Do you have the number of

temporary staff?

MR. JANES:

Temporary staff I

would have to come back to you exactly, but we do not tend to have many

temporary staff. We do have

students. I do not know if you

qualify those as temporary. There

are several students, but we rotate those through fairly regularly.

There are some contracted consultants, but temporary staff

is not a I will double check for you, but off the top of my head I cannot

identify.

MR. CROCKER:

You just mentioned contractual staff.

How many contractual staff would you have?

MR. JANES:

Again, I will get the exact number, but it is probably two or three.

The nature of our contractual staff tends to be when we are looking for

specialized skills. I can give an

example.

We have a need for geoscience.

We have a geoscience expertise, but that expertise is needed

sporadically. So we have a call

down provision contractual services to make available those services as needed.

It is not warranted to have a full-time position.

That is typically where we have that type of expertise or

those types of arrangements is when we need highly specialized skills and it is

not warranted to have a full-time positon.

MR. CROCKER:

Okay.

there a copy of an operational budget or would you find that in the Research and

Development's portfolio? It is not

broken down here in Estimates.

MR. KING:

It is not in Estimates

because they operate as an independent corporation of government, so we provide

them a grant and then they in turn operate under a board of directors.

MR. CROSS:

Mr. Glenn Janes.

MR. JANES:

I would like to add, though,

all our financial statements on a quarterly basis are posted online.

MR. CROCKER:

Okay.

Audited by the Auditor General, am I correct?

MR. JANES:

Every year, yes Sir the

Auditor General is our routine auditor, so he audits our books every year.

MR. CROSS:

So you are going to defer to

Mr. Murphy?

MR. MURPHY:

Thank you, Mr. Chair.

I do

not have too much now that the Official Opposition has not covered already.

You mentioned contractual staff, geoscience, could you tell me if there

were different corporations or anything that might have been hired,

subcontractor work to it?

OFFICIAL:

(Inaudible).

MR. MURPHY:

The different companies that

might have been contracted or is it just

MR. KING:

Excuse me, Mr. Chair, if you

could direct the question to me, please, as the minister.

MR. MURPHY:

Okay, sorry.

MR. KING:

Thank you.

MR. MURPHY:

Minister, I wonder if you

could tell me who the contractual staff would be that would have been hired.

MR. KING:

Who the contractual staff

would be?

MR. MURPHY:

Yes.

MR. KING:

Specific names you mean?

MR. MURPHY:

Well if you have it, or

corporations, companies.

MR. JANES:

Typically, they are

individuals with professional skills.

It tends to be independent consultancies as opposed to large firms.

As an example, a gentleman who heads up our geoscience that I have

mentioned before formally has a geoscience background, but is now retired.

Another individual who does sensor technology and has expertise in that

area, again, is an independent consultant.

So as opposed to contracting large firms, these are private individuals,

typically, who sell their expertise and skills.

They tend to be late career individuals as well who have seasoned

expertise in their areas.

MR. MURPHY:

Okay.

Minister, I notice that there was a drop in Grants and Subsidies this year of

$122,000. I wonder if you could

explain that.

MR. KING:

We found some savings in

working with the corporation, so we reduced $75,000 that we were going to spend

on our document management system.

We have converted an IT director position to a manager's position for a savings

of $55,000. We have also found

$75,000 in scaling back web development and the harsh wind environment study.

MR. MURPHY:

Okay.

MR. KING:

Total savings would be

$205,000 there.

MR. MURPHY:

All right.

noticed on the bottom line the total for the department I do not know if you

want to deal with that full line now that is probably including everything

under Business, Tourism or you just want to deal with Research & Development

Corporation for now?

MR. KING:

Yes.

MR. MURPHY:

Okay, fine.

Minister, just wondering about the board of directors who is sitting right now

on the board of directors? Do you

have a full complement of staff?

MR. KING:

Yes, we do.

MR. MURPHY:

Who is sitting on the

Research & Development

MR. KING:

I do not have that list here

right now, but I can table that for you.

It is on our website, but if you want me to print it off I can get it for

you.

MR. MURPHY:

Okay, I will have a look.

You

mentioned corrosion research as well in this particular case.

Would that be government money going perhaps you can explain the

corrosion research that is happening?

MR. KING:

Sure.

Glenn.

MR. JANES:

Again, that is a select example, given that this organization is doing over 500

projects, but I will give it as an illustration in this case.

We have done some studies.

Our industries in this Province suffer from high wind speeds, salt, and things

rust very readily in our environment here.

Some of our main industries, particularly our extractive industries, have

that as a challenge because their tools and their equipment and their

infrastructure do not stand up in the Newfoundland climate.

short, what we have done is put a site in place to be able to test things like

protective coatings for steel and metal to try to prevent them from rusting,

understanding why they rust. We

have invested several hundred thousand dollars as an organization to establish

that test site to correlate it to others to prove that it is a strong, viable

site, but then we are using it to service industry and other clientele.

So, in

that instance, we have Husky Energy as a partner on the site and have a project

on it, and we have other people who are coming to us to pay us to use the site.

It is addressing a need of the industry, such as the mining industry, the

oil and gas, to overcome some of their technical challenges to make sure the

challenges that we have for our industries in this Province have the potential

to have those problems solved in this Province.

MR. MURPHY:

Okay.

A list

of those projects is it possible to get a hold of, Minister, some of the

ongoing projects, or would they be proprietary information?

MR. KING:

They are all online on the

web as well.

MR. MURPHY:

They are on the web as well,

okay.

That is

all I have right now.

MR. CROSS:

That concludes the Research & Development.

Would the minister like to include a comment or do we want

MR. KING:

No, that is fine.

MR. CROSS:

So, these people can leave if they choose.

MR. KING:

Sure.

Do you

call a vote on that particular head and put it to bed?

MR. CROSS:

Okay, yes.

So we

will call 9.1.01.

Motion?

Carried.

motion, subhead 9.1.01 carried.

motion, Estimates for Research & Development Corporation, total head, carried.

MR. KING:

Okay, thank you, folks, I

appreciate it.

MR. CROSS:

Just a couple of quick things before we get right back in.

I am a rookie in the Chair this morning.

One of the first items of business we need to do, we needed to get a

nomination for a Chair, so I would like someone to nominate.

MR. LITTLEJOHN:

I will nominate Mr. Cross.

MR. CROSS:

Moved by Mr. Littlejohn.

Seconder?

MR. CROCKER:

I will second that.

MR. CROSS:

Seconded by Mr. Crocker.

All

those in favour, 'aye.'

SOME HON. MEMBERS:

Aye.

motion, Mr. Cross was elected Chair.

CHAIR (Cross):

Also, looking at the list,

all three members for the Official Opposition and the NDP are filling in this

morning. So normally we would

probably wait until the next meeting, if they are going to be here tonight, and

we would do the Vice-Chair at the next meeting.

The

other thing is just a referral that we are governed in Estimates by a Standing

Committee and or Standing Orders 65 to 77.

All members address the minister for a question and then he would

deflect. The time we relax on that,

just for clarification, is if the minister has already deflected to a person and

there is a follow-up short question or query to something that is done.

All members will be directing their questions to the minister.

well, we will probably work along we are a few minutes late starting, so

around 10:40 o'clock, approximately, we will probably break for ten minutes or

so, if that is convenient with everybody, and come right back.

Now we

will move and I will call the first head 1.1.01.

MR. KING:

Mr. Chair?

CHAIR:

Yes.

MR. KING:

If I could, with the

Committee's indulgence, could we move to

section 8.1.04 and do The Rooms?

CHAIR:

Okay.

MR. KING:

It is the same scenario as

RDC. That is the only

section they

have.

CHAIR:

Subhead 8.1.04.

Okay.

MR. KING:

I would also like to welcome

Dean Brinton who just joined us, the CEO of The Rooms Corporation.

CHAIR:

The Rooms Corporation,

8.1.04. Heading called.

The

Official Opposition, Mr. Flynn

MR. FLYNN:

Thank you.

Grants

and Subsidies for The Rooms this year has gone up by about $500,000.

What is planned here and why do we have a $500,000 increase?

MR. KING:

We have allocated $250,000

towards maintenance in particular, and a security system replacement; $80,000

has been appropriated to hire a conservator back to The Rooms, they have been

without one for about two years; $42,000 to hire an art gallery administrative

assistant, a similar situation, there has been a vacancy there for a couple of

years and a need identified; and, $95,000 combined to assist with some

restoration of exhibits and redevelopment of programs.

MR. FLYNN:

A quick question.

From a revenue point of view this is not showing in the subsidy.

What would be the revenue that The Rooms generates annually?

MR. KING:

Dean.

MR. BRINTON:

Thank you.

About

$1 million.

MR. FLYNN:

There were some renovations

occurring at The Rooms which are, from what I am hearing, causing some

discontent, we will put it that way, with the staff from a couple of the rooms

there. What were the names of the

rooms?

OFFICIAL:

The

photo room.

MR. FLYNN:

The photo room and the

anyway there were two rooms document room maybe.

I know there was some concern expressed to members of the Opposition

about these renovations. I am not

trying to be pigheaded here or to be mean; I am just wondering have they been

able to alleviate some of these concerns by the staff who were there?

MR. KING:

I am not aware of any of

those concerns.

MR. FLYNN:

A letter was written to the

minister on March 20.

MR. KING:

If you could specify your

concerns. You are a little bit

vague in your generalization there.

We are in Estimates talking about the budget of The Rooms.

If you want to stray from that you are going to have to be very specific

in your question in order for me to answer it.

MR. FLYNN:

Okay.

The question was, I guess and, again, I do not want to seem mean to

your manager there. This was felt

by the employees a little bit of a waste of money with making the office bigger

for the manager at The Rooms. They

have lost rooms there so was it a good expenditure of money?

MR. KING:

I would say yes, otherwise we would not

have done it.

MR. FLYNN:

These were purpose-built

rooms for the mapping and so on. I

am not a conservator, as some of you might know, so obviously it played an

integral

part in The Rooms displays.

These areas now are still vacant I understand.

I am not sure what we can do with that or if there is an explanation for

that.

MR. KING:

I am not hearing a question;

I am hearing comments and observations.

I am not hearing a question from you on that.

MR. FLYNN:

The question is then I

guess, Darin: Why was it done? Why

are these spaces vacant today?

CHAIR:

This speaking is Mr. Dean

Brinton. I am just speaking now for

the Broadcast Centre to turn on your mic.

MR. BRINTON:

Thank you.

reallocated some space within the building.

The area you have mentioned is an area where art being shipped into The

Rooms would be processed, and art being shipped out of The Rooms would be

processed. We found what we think

is a better space to do that. It is

closer to the loading dock that also has environmental controls for the art.

There

is a bit of disgruntlement because the employee who was in the old space had a

wonderful view of The Narrows, which she no longer has.

The space is being converted into a multi-purpose space for rentals and

for programs. The idea is to be

able to generate some revenue. It

is not being used by management as a staff office.

MR. FLYNN:

Specifically, the document

room?

MR. BRINTON:

Yes.

MR. KING:

(Inaudible) the questions to

the minister, please.

MR. FLYNN:

Specifically the document

room?

MR. BRINTON:

Yes.

MR. FLYNN:

I have no further questions.

CHAIR:

Mr. Crocker.

MR. CROCKER:

I am just wondering.

Minister, you said there was reference to fees.

Were there any fee increases, or are there planned fee increases for The

Rooms as part of this year's Budget.

MR. KING:

Dean, do you want to speak

to that specifically? The answer is

yes.

MR. BRINTON:

Yes, we have wanted to

increase fees at The Rooms for many years.

The Rooms is far cheaper than any comparable cultural facility in Canada.

The

increase from $7.50 for an adult admission to $10 is still less than the GEO

CENTRE in St. John's. It is far

less than comparable museums in Canada.

MR. CROCKER:

Your numbers of visitors per

year, Minister, at The Rooms; the number of visitors per year

MR. KING:

Paying?

MR. CROCKER:

Yes, the paying number of

visitors to The Rooms per year?

CHAIR:

Mr. Brinton.

MR. BRINTON:

Right now we have about 80,000 visitors a year.

We think that with this reinvestment, particularly in programing, we want

to take that number to 100,000 in the next couple of years.

With some of the new exhibits that we are opening, particularly on the

First World War, we are very confident that we are going to have a very strong

visitor base in the years ahead.

MR. CROCKER:

Minister, there is an ongoing project, I think, for 2016 at The Rooms.

Is that on budget and on time?

MR. KING: Which

project are you referencing, the Honour 100?

MR. CROCKER:

Well, part of the Honour 100, I would assume.

Is it part of Honour 100 or is it a separate project?

CHAIR: Mr.

Brinton.

MR. BRINTON: It

is a separate project, but we work closely with Honour 100 in rolling it out.

It is going to be the largest First World War exhibition in

Canada. That is part of what we are

doing. It is all privately funded.

T here

is no public money involved, and we are very pleased about the support we have

received from the community.

MR. CROCKER :

Okay, thank you.

CHAIR:

Mr. Crocker is concluded?

MR. CROCKER:

I have.

CHAIR:

Mr. Murphy.

MR. MURPHY:

Minister, how many

conservators do we have and in what areas at The Rooms now, and are they

permanent or contract?

MR. KING:

How many conservators?

MR. MURPHY:

How many conservators are

there?

CHAIR:

Mr. Brinton.

MR. BRINTON:

We have no conservators at all.

That is why this one was so important.

MR. MURPHY:

Okay.

So, if I can digress, the conservator that you are hiring, though, is he

or she going to be on contract or is this going to be a permanent position?

MR. BRINTON:

The hope is to have a permanent position.

Obviously, we would be the only provincial archives in the country

without a conservator. For purposes

of upholding our professional standards and taking care of the provincial

collections, we do have to have a conservator.

MR. MURPHY:

Okay.

You

mentioned the Great War exhibit that is happening now.

How much is being allocated, Mr. Minister, for the Great War exhibit?

The Honour 100, I guess.

MR. KING:

As Dean just referenced,

there is no money allocated from government.

It is privately funded.

MR. MURPHY:

Privately funded, the Honour

100 program?

MR. KING:

No you are talking about

two different projects. The project

at The Rooms which is under this

MR. MURPHY:

So, that is separate

altogether from The Honour 100?

MR. KING:

That is privately funded.

The Honour 100 would be in a separate part of the department here.

MR. MURPHY:

All right.

The

only other question I had as regards to the movement of The Rooms, I think I

know why you would have to move some of these rooms that you were talking about

with regard to the protection of documents and everything.

I take it that is why you decided to make the move of these rooms happen.

Maybe you can explain that a little bit more.

MR. BRINTON:

Are you referring, Sir, to the earlier question about the documentation?

MR. MURPHY:

Yes, about the

documentation, Sir.

MR. BRINTON:

As I mentioned, we think that we can use that space to a greater extent by

having it as a multi-purpose room and being able to rent it to generate revenue.

It does have, probably, the best view in Eastern Canada and yet it was

used for day-to-day administrative work, really shipping and receiving of art.

We found another place to do that closer to the loading dock, as I

mentioned, and we think that this space with its wonderful view will be a real

asset to us in terms of generating revenue.

MR. MURPHY:

Okay.

Mr.

Minister, it was mentioned earlier about $1 million in revenue that The Rooms

earned last year. I wonder if we

can get a breakdown on where they got that revenue from was that just

generally visitors or rental of The Rooms facilities for weddings and that sort

of thing, various conventions?

MR. KING:

A combination of all.

MR. MURPHY:

A combination of all, okay.

The

only other thing that I had was already asked earlier about the $551,000

increase in the budget again. Can I

get a breakdown on what was happening here?

I did not quite catch it earlier.

MR. KING:

Sure.

As I said a few moments ago $250,000 would be for increased maintenance

costs as well as a security system replacement; $80,000 to hire a conservator;

$42,000 to hire an art gallery administrative assistant; and $95,000 to restore

exhibitions and develop programs.

MR. MURPHY:

Okay.

I am all done.

CHAIR:

Shall 8.1.04 carry?

Carried.

motion, subhead 8.1.04 carried.

CHAIR:

Now we will revert to

1.1.01. Just as clarification, a

moment ago when I deflected, normally after Mr. Flynn finished I would go to Mr.

Murphy; but I saw the time on the clock and it looked like Mr. Crocker would

conclude in less time so I went to him before I went to Mr. Murphy.

In the future, I will go back and forth from Opposition member to Third

Party member for ten minutes at a time.

MR. MURPHY:

I do not mind; it is all

within their allotted time anyway.

CHAIR:

We call 1.1.01.

Mr.

Flynn or Mr. Crocker, whichever.

Mr.

Flynn.

MR. CROCKER:

Thank you, Mr. Chair.

I have

to get back on track (inaudible).

CHAIR:

It is Mr. Crocker.

For the Broadcast Centre, I am identifying Mr. Crocker.

MR. CROCKER:

Thank you.

I guess

my first question in this

section would come from Transportation and

Communications. The budget last

year was $90,800. The department

spent $55,000, and this year the budget was reduced from last year's budget but

higher than last year's expenditure.

I wonder if the minister could explain the reasoning behind the under

spend and the reasoning behind the budget decrease.

MR. KING:

Sure.

First

of all, the under spend was simply related to less than anticipated travel

expenditures, plus we had a change in the minister where, at one point in time,

the department had an acting minister who was also in another portfolio which

reduced the travel expenses.

The

anticipated travel for this year is $75,000.

What we did there is two things one, adjusted it because we no longer

are responsible for the Office of Public Engagement.

That is moved to another department.

We are anticipating decreased travel by the minister as a result of

looking at the historical patterns of travel in the department.

So the budget more closely reflects what we believe to be the historical

pattern.

MR. CROCKER:

Minister, does it have

anything to do with the discretionary freeze?

Is that why the budget was under spent, this past budget?

MR. KING:

Yes, it could a little.

It predominately is the travel for myself and the deputy.

Certainly, there has been travel that I have not done that I may have

done otherwise.

Although the minister's travel has not necessarily been frozen, we have

obviously taken a look at that like we do with employees; but a large part of it

is reflective of the vacancy in the office and for the next year, of course, we

are losing Public Engagement.

MR. CROCKER:

Minister, is the staff at a

full complement, currently? You

just outlined there is one vacancy.

MR. KING:

The staff in the Minister's

Office?

MR. CROCKER:

Yes.

MR. KING:

Yes, it is a full

complement.

MR. CROCKER:

Okay.

Are there any temporary staff in the Minister's Office currently?

MR. KING:

I guess it would be me and

the executive assistant.

MR. CROCKER:

So, Minister, is that a

thirteen-week contract?

MR. KING:

It has been eight years so

far; temporary for eight years.

MR. CROCKER:

Excuse me, this is my first

Estimates. We are just going to go

this

section and vote on it and move to

MR. KING:

Yes,

section and vote and

move on.

MR. CROCKER:

Randy is pointing out stuff

I have missed.

Purchased Services for last year, Minister, were budgeted at $15,600, the actual

spent was $1,100. Could you explain

why? Then we go back to the $15,600

this year. What happened there?

MR. KING:

Nothing specifically just

less purchases and less expenses in that account than we anticipated.

Looking at the historical trend though, we do tend to spend that amount

so we put the budget amount back to be the same.

MR. CROCKER:

Are there any purchased

services, Minister, that have already been identified for this year, stuff that

we know you are going to have to purchase or is it

MR. KING:

You can go ahead.

CHAIR:

Speaking would be Alastair

O'Rielly.

MR. O'RIELLY:

There are no specific expenditures that we are planning for the coming year; it

is the normal course of events.

There is a variety of things that will be sourced .

Computer services and that kind of thing can be charged off to the

Purchased Services. So as the

minister said, it is just a reflection of the historic expenditure for the

minister's office.

MR. CROCKER:

Okay, we are good.

CHAIR:

So you are good for that

section?

Mr.

Murphy.

MR. MURPHY:

Just one question, Minister,

on Employee Benefits. It shows

$4,000 there. I am just curious

about that line.

MR. KING:

What specifically are you

curious about?

MR. MURPHY:

Where it says Employee

Benefits, there is $4,000 allocated for.

MR. KING:

Right.

MR. MURPHY:

There was no uptake on that

obviously in the revised figure, but it was also budgeted for $4,000.

MR. KING:

You are asking what it is

for, are you?

MR. MURPHY:

Yes.

MR. KING:

Okay.

It is for conference registrations and things like that for the minister.

We did not use any this year.

We anticipate there will be some next year.

MR. MURPHY:

Okay.

That is all I have on that section.

CHAIR:

Okay.

We call 1.1.01.

All

those in favour, 'aye.'

SOME HON. MEMBERS:

Aye.

CHAIR:

Carried.

motion, subhead 1.1.01 carried.

CHAIR:

Subhead 1.2.01. I guess this

way of moving on, doing each section, means that we may not be using the full

ten-minute complements by members; we will be passing back and forth.

We will be concluding a

section of the Estimates at each time.

If in

either particular

section we go beyond the ten minutes, then we will stop and go

to the next speaker, unless someone is ready to conclude.

MR. MURPHY:

Just a question on the

process, Mr. Chair. I always

thought that we would have a full

section of subheads that would be called,

because I think what happens is probably a little bit confusing rather than

voting each

section by section.

CHAIR:

Okay.

That is fine, yes.

MR. MURPHY:

For example, in this

particular case I was thinking that it might have been more beneficial for the

Chair to call 1.1.01 over as far as 1.2.04.

CHAIR:

All of

section one.

MR. MURPHY:

All that

section one.

CHAIR:

After we finish the whole

one, okay.

MR. MURPHY:

Yes, because they are asking

some questions that I might have asked too.

I think because of expediency and the simple fact that we only have three

hours we would probably be able to get through the full section.

Then it would probably be easier to manage the clock as well.

It is just a suggestion to the Chair.

MR. KING:

Mr. Chair, I am fine with

that, except I think we should follow the order.

Otherwise, you could get into a situation of flipping pages back and

forth, jumping all over. I think we

need a system. I am fine with doing

five or six sections and then doing the vote, but I think we should follow one

section, conclude it, and do the other-

CHAIR:

Call the vote at the end of

the section.

MR. KING:

It is going to be easier for

all of us. Otherwise, you are going

to be all over the place.

CHAIR:

Okay.

MR. KING:

I am fine with that.

MR. MURPHY:

Yes, it just seems more

expedient to do it that way just to get through the whole budget.

CHAIR:

Okay.

So we will call the entire

section one.

At this point it is there on two pages and we can see it.

We will

start with Mr. Murphy to continue on there.

MR. MURPHY:

Okay, so we are on 1.2.01

now?

Executive Support, Mr. Minister, there is $134,906 more in that department this

year. I wonder if you can explain

what is happening here. Is this

more positions?

MR. KING:

Where are we?

MR. MURPHY:

Subhead 1.2.01.

MR. KING:

Yes, I apologize.

I missed the first part of your question.

Sorry.

MR. MURPHY:

There is a $134,906

difference between what was spent last year and what is budgeted this year.

MR. KING:

The $1.076 million and

$1.171 million; you are referencing Salaries, correct?

MR. MURPHY:

Yes, that is it.

MR. KING:

The actual increase from

budgeted last year sorry. We have

two things there: one is the department has an additional person in

communications as a result of the merging of the departments, and the provision

of a secretary for the ADM in tourism.

Both of those are a result of the merger of the departments.

MR. MURPHY:

Okay.

We did have to hire more staff anyway with regard to that, even though

there might be one less position in Cabinet.

That would be the assumption here?

MR. KING:

No, I would not make that

assumption. When you do Estimates

of other areas you will find there were decreases in other areas.

Like when you get to the tourism section, for example.

MR. MURPHY:

Okay, so the shifting of

personnel.

MR. KING:

Yes.

MR. MURPHY:

Okay.

MR. KING:

Just to more accurately

reflect where it ought to be in the budget line.

MR. MURPHY:

All right.

Under Transportation and Communications as well, you have $122,700 as

your number for last year. That is

being revised downwards to $101,300.

MR. KING:

That is part of our efforts

to try and save some money on travel.

We have adjusted it and we are trying to live within our means.

MR. MURPHY:

Okay.

That is all I have on that section.

CHAIR:

Okay.

Just to clarify again as we go through, I diverted Mr. Murphy because his

time was not expired. We are asking

everyone to start with 1.2.01, and any questions that you have going through,

you continue on until you get to the end of

section one.

At that point, we will defer it back across.

MR. CROCKER:

When I started my question I

was not under that that is how we were going to be doing it.

MR. KING:

Mr. Chair, if I could

CHAIR:

It gives some order to it

and helps us get through.

MR. KING:

Mr. Chair, if I could make a

quick comment just for the interest of members.

You are going to find, as you go through because the same heads show up

in almost every section. You are

going to find travel down in almost all areas.

I can say to you upfront that we have reduced travel by $351,500.

You might ask the same question and get the same answer over and over.

That is a part of our efforts to save money within the department.

That is the first thing.

The

second thing I want to mention to you is the Purchased Services and Professional

Services show up on occasion. Those

are all going to be similar answers.

Unless there is a huge number, if the budget is off by $2,000 or $3,000,

it is less than anticipated costs.

I just

want members to know that so I do not sound repetitive.

Unless it is a large number, you are going to find the same answer that

we budgeted $10,000 and we spent $8,500 or $9,000, just so you know.

CHAIR:

Okay.

Mr.

Crocker.

MR. CROCKER:

We are at 1.2.01?

CHAIR:

Continuing on 1.2.04, yes.

MR. CROCKER:

Under Property, Furnishings

and Equipment, Minister, the budget was $900 and the actual expenditure was

$8,000 more than that. Could you

explain the huge increase in the expenditure?

MR. KING:

Sure.

We had to purchase some ergonomic equipment for staff.

That would have been a desk, chairs, computer keyboard, monitors, and

other things.

MR. CROCKER:

So we are moving to 1.2.02,

Mr. Chair. There was about a

$27,000 overspend on Salaries in the budget, and this year's budget has moved up

again to $521,000. I was just

wondering if the minister could explain the increase in Salaries.

MR. KING:

A couple of things there,

Mr. Chair. I was just clarifying

with the deputy before I provide an answer.

We had some delayed recruitment coming into the year for a couple of

positions that would have put us over the salary budget.

Also, we had student payments, a number of students hired.

That came from that

section as well.

MR. CROCKER:

Okay.

I am

just wondering if the minister could break down the staff complement in

Administrative Support: full-time, temporary, and vacant positions.

MR. KING:

Just for this subhead you

mean?

MR. CROCKER:

Yes, Administrative Support.

MR. KING:

I do not have it broken down

like that, but I can get that for you.

We have a

summary there of the whole department, but just let the record

note that you would like it for that particular subhead and we can get that.

MR. CROCKER:

Thank you, Minister.

Supplies for Administrative Support were budgeted at a little over $66,000, the

expenditure was $17,000, and this year's budget went back to the original budget

of last year. I am just wondering

if the minister could explain the under spend and the reason why we went back to

the full budget for this year.

MR. KING:

Basically, it is similar to

before, less than anticipated costs, we made a concerted effort to try and find

some savings part way through the year.

At this point in time at least we are maintaining the budget because

historical patterns show that we do tend to spend most of that budget.

MR. CROCKER:

Okay.

There was not a large spend cancelled last year?

MR. KING:

No.

To be

clear, that

section will be repeated as well.

That is things like paper, toner, cartridges, copier cartridges, things

like that.

MR. CROCKER:

Okay.

Professional Services was budgeted at $50,600 and spent $40,000; could the

minister outline what type professional services would be budgeted there?

MR. KING:

Professional services all

throughout the budget would be any time we engage outside consultants for work

on different projects, things like that.

MR. CROCKER:

Could the minister give an

example of the type of outside service that would be contracted for that part of

the department?

MR. KING:

Alastair, do you want to go

ahead and give an example?

MR. O'RIELLY:

This particular item, a number of the expenditures were related to the hiring of

an external consultant to help us with our information management system.

The department introduced a new system last year and it needed to be

expanded and further implemented.

Plus, of course, it had to be applied to the tourism and culture

section of the

department as well. Most of that

expenditure was for that particular IM consultant.

MR. CROCKER:

Thank you.

Could

the minister just explain the provincial revenue?

It was budgeted at $7,600, came in at $7,600, and it is budgeted at

$7,600 again this year? Could the

minister tell us what the revenue stream is?

MR. KING:

Ken Curtis.

MR. CURTIS: That

is miscellaneous revenues we record there for areas of the department that is

sort of if people had a trip advance last year and they did not spend all

their money and they paid their money back this year, it was a salary

overpayment that someone was paying back.

It is generally administrative areas where someone was

issued a cheque last year and for some reason the cheque needs to be cancelled

and the money refunded. The money

shows up there as miscellaneous revenue.

MR. CROCKER: So

really it is not new money. It is

budget money not spent.

MR. CURTIS:

Yes, for the most part. It is

repayment of prior year's expenditures.

MR. CROCKER:

Is this for the entire

department or just the administrative support side of the department?

MR. CURTIS:

This tends to be a fairly small amount.

It is for the entire department, but it tends to be a small amount.

Usually if someone gets a trip advance during the year, for instance they

submit their travel claim and the trip advance and everything is sorted out.

This tends to happen in the case of a trip advance where

you get a trip advance late in the fiscal year, say in March, you do not get a

chance to process your claim until April so it is considered in a different

fiscal year. So any difference in

the trip advance is recorded as a revenue item here.

So it tends to be small amounts for miscellaneous things

throughout the department.

MR. CROCKER:

Thank you.

I guess moving to 1.2.03, the salary budget for the Policy

and Strategic Planning was $544,000.

We see a budget increase this year to $622,000.

I was wondering if the minister could explain why there is an increase in

salary in that part of the department.

MR. KING: We

had an addition of an extra staff member as a result of a merger of two

departments.

MR. CROCKER:

Could the minister tell us when this staff hire was made?

MR. KING: Late

November or early December, I think, sometime in that area.

MR. CROCKER: So

this portion of the department now has its full complement of staff?

MR. KING:

Yes.

MR. CROCKER:

Are there any thirteen-week

contracts currently in this portion of the department?

MR. KING:

No.

MR. CROCKER:

Professional Services,

Minister, last year was budgeted at $50,000.

The expenditure was $4,100.

I see this year's budget has been cut in half.

Could you explain that? Is

that a budgetary restraint or just to reflect the fact that it was not used in

the past?

MR. KING: There

were two changes. First of all, the

reduction in expenditure this year is a result of two surveys that we were

intending to do that we did not do, and the dropped

budget is an effort by us to try and save some funds in the department.

MR. CROCKER:

Okay.

Could

the minister explain the surveys that were intended to be completed but were not

completed?

MR. KING:

Sure, the workplace survey

and the client satisfaction survey.

We do plan to do them; we just deferred them from this fiscal.

MR. CROCKER:

So they will not happen this

year either?

MR. KING:

Possibly, we are not sure.

MR. CROCKER:

Last year there was a budget

in the department for $75,000 in Grants and Subsidies, it was expended, and this

year it is showing at $25,000.

Could the minister tell us what those grants and subsidies were?

MR. KING:

We provide grants and

subsidies to a number of groups and organization, industry associations in the

Province and in this particular case we are making a reduction of the total

budget by $50,000.

MR. CROCKER:

Would the minister be able

to provide a list of the grants and subsidies that were provided last year to

add up to the $75,000?

MR. KING:

In this particular

section

there was two the Harris Centre was $50,000, and that is where the reduction

is; the other one was through the MUN Collaborative Applied Research division,

$25,000.

MR. CROCKER:

I guess my time is expired.

CHAIR:

Okay, so we move to Mr.

Murphy.

MR. MURPHY:

Thank you, Mr. Chair.

Back

under

section 1.2.02, Mr. Minister, I wonder if we can get a breakdown of what

is happening with Purchased Services here.

For Administrative Support, it is about $111,800 budgeted for, over

$95,000 was spent.

MR. KING:

That reflects simply savings

that we tried to find late in the year.

The purchased services would include things like meeting costs,

advertising, printing, equipment rentals, and things like that.

MR. MURPHY:

Okay.

Coming

over again to

section 1.2.04, Grants and Subsidies of $1.8 million, nothing in

this department before so I guess we will start there in line 10.

MR. KING:

Okay

MR. MURPHY:

Subhead 1.2.04.

MR. KING:

Okay, thank you, sorry.

Okay,

your question again, and I apologize?

MR. MURPHY:

I was just wondering what

was happening on this particular line.

We are showing $1.8 million is budgeted for this year, nothing last year,

and nothing in 2014.

MR. KING:

Sure, thanks.

That is

part of a multi-year commitment to the revitalization of the Colonial Building.

In 2014-2015, there was $200,000; in 2015-2016 there was $1.8 million;

and the following Budget year it will be a little over $1 million as well.

MR. MURPHY:

What are they anticipating

for this $1.8 million? Do we know

what they have applied for here and what they are getting?

Or is this just for general construction down there in the area?

MR. KING:

It is for the

interpretation.

MR. MURPHY:

For the

interpretation

centre. Okay.

Under

Property, Furnishings and Equipment it went from $270,000 budgeted down to

$184,000 and nothing this year.

What was this line for in Administrative Support.?

MR. KING:

The $270,000 that was

budgeted was a one-time allocation for the purchasing of land in Cupids for the

most part. The reduction reflects

the actual price.

MR. MURPHY:

Is this for the Legacy

Centre?

MS MURPHY:

No, that was the Cupids land purchased which is related to the Cupids Cove

Plantation which is the actual Provincial Historic Site.

MR. MURPHY:

Okay.

MS MURPHY:

This has been ongoing for quite some time to resolve all of the land ownership

in the area to acquire the land as a Provincial Historic Site.

MR. MURPHY:

Okay.

That is all I have, Mr. Chair, for

section one.

CHAIR:

Okay.

So we will come back to Mr. Crocker to conclude.

MR. CROCKER:

Just one question or two

possibly. In the details of the

attrition plan by the government that is proposed, the department is going to

lose six staff for a savings of $395,000.

I was wondering if the minister could tell us what positions are going to

be eliminated, and if these are temporary or permanent positions.

MR. KING:

Specifically, we have not

identified which positions we will be taking out.

We will have a number of retirements.

The attrition plan, basically, mandates the department to find the six

positions over the fiscal year. We

are in the process of doing that now, but we have not specifically identified

yet which positions they will be.

MR. CROCKER:

Okay.

One other question to the minister, 1.2.04; we see a budget last year for

Property, Furnishings and Equipment that is the one George asked.

MR. KING:

Yes.

MR. CROCKER:

Okay.

That is the Cupids land.

MR. KING:

Plantation.

MR. CROCKER:

Plantation, okay.

We are

good, Mr. Chair.

CHAIR:

Okay.

We will call sections 1.2.01 to 1.2.04 inclusive.

All

those in favour, 'aye.'

SOME HON. MEMBERS:

Aye.

CHAIR:

Contrary, 'nay.'

Carried.

motion, subheads 1.2.01 through 1.2.04 carried.

CHAIR:

Now we are looking at 2.1.01

to 2.1.03.

MR. CROCKER:

Thank you, Mr. Chair.

I just

wonder if the minister could outline in the Salaries of the $1.6 million, what

the actual staff complement is in this activity and if it is permanent,

temporary, or contractual staff?

MR. KING:

Twenty-eight.

MR. CROCKER:

Twenty-eight full time, no

temporary?

MR. KING:

Twenty-eight in total.

We do not have the breakdown here of what would be temps.

We can get that.

MR. CROCKER:

Okay.

MR. KING:

Just to be clear, those

numbers by the way are published in the Salary Details document for the

department, the temporaries and the permanents.

MR. CROCKER:

Thank you Minister.

Minister, the Professional Services line in this section; the budget was

$500,000 and the expenditure was $261,000.

This year's budget has been reduced by $75,000.

Could the minister outline the Professional Services that would have been

budgeted or expended last year and what Professional Services would be budgeted

for this year?

MR. KING:

Daryl will give you some

examples.

MR. GENGE:

This budget item is used

primarily for in-market consultants.

Those are consultants to work with our companies on trade missions, as

well as studies and other activities.

We have

conducted a study on opportunities in China, in-market consultants in Ireland,

and ocean technology study to look at opportunities in the ocean tech sector

internationally. These are examples

of the types of work we do there.

MR. CROCKER:

Are these studies available

to the public, Minister, or available to the House?

MR. KING:

They are not typically

studies where we produce a document for public consumption.

The studies are part of what drives our planning and research into those

areas to plan business development missions and to look for opportunities for

companies that are travelling abroad.

So it is work that informs the department's work with the business

community.

MR. CROCKER:

Okay.

I am just wondering if it would be possible for the minister to provide a

list of the Professional Services that were expended in the $261,000.

MR. GENGE:

Yes, we can provide a list.

MR. KING:

Yes.

MR. CROCKER:

In this year's allocation of

the $425,000, are there any specific studies or opportunities, or is it just a

general allocation as the department goes through the fiscal year?

MR. KING:

It would be a general

allocation, but certainly we would have a target in priority areas that we will

be focusing on where we see opportunities for business growth and new business

to help develop the Province.

Generally, it is not a fund that is already earmarked dollar for dollar.

MR. CROCKER:

Okay.

MR. GENGE:

Yes, Minister, that is correct. We

do have a number of studies that we want to undertake, but sometimes it is very

much responsive to the requirements of our missions and activities.

MR. CROCKER:

Grants and Subsidies in this

section were budgeted at $237,000, expenditure was $199,000, and the budget is

back to $237,000. I wonder if the

minister could provide some information regarding what types of Grants and

Subsidies, and also possibly provide a list of the companies or individuals who

have received these Grants and Subsidies.

MR. GENGE:

It is more so Grants and Subsidies that are used to support some of our

international activities. We

provide a contribution to the International Business Development Agreement,

which is a five-party agreement with the Atlantic Provinces and the Atlantic

Canada Opportunities Agency that supports some international business

activities. It also supports some

of our subscriptions to APEC and to the Council of Atlantic Premiers.

We do provide some support to groups or organizations that are

undertaking international business activities, some youth groups, and those

sorts of things.

MR. CROCKER:

Okay.

Thank you.

We can

have a list of those, Mr. Minister?

MR. KING:

Sure.

MR. CROCKER:

Thank you.

MR. KING:

Not today.

MR. CROCKER:

Pardon?

MR. KING:

Not today.

I do not have it.

MR. CROCKER:

Are you sure?

Minister, we come down a couple of lines and we see revenue from the federal

government which was projected at $300,000.

The actual contribution from the federal government was $175,000.

Could

the minister explain where this contribution from the federal government comes

from, and why we fell short by $125,000 from the anticipated revenue from the

feds, and this year we are budgeting revenue at $300,000?

MR. KING:

Sure.

Daryl.

MR. GENGE: Yes,

well every year we will anticipate that we will undertake about five to six

International Business Development Agreement projects.

Those projects are ones that are paid for primarily out of our

Professional Services budget.

When we do them on behalf of the Atlantic Provinces, we get

that money back from the International Business Development Agreement.

That revenue line is the revenue that we receive from the IBDA for

undertaking projects on behalf of the Atlantic Provinces.

MR. CROCKER: So

it is just a reimbursement of expenditure.

MR. GENGE: That

is right. Yes.

MR. CROCKER:

Moving to the next section, 2.1.02, we see a decrease in Salaries there.

I was just wondering if the minister could explain the decrease in

Salaries. Is this an area where the

attrition may be affected?

MR. KING: You

are referencing the budget for this year, $367,000?

MR. CROCKER:

Yes, versus the $425,000 from last year.

MR. KING:

Sure, yes.

That reflects to the attrition management.

We anticipate finding some savings there.

MR. CROCKER:

So is this one position

leaving in Marketing, Enterprise and Outreach?

MR. KING:

One position would be a

public information officer.

MR. CROCKER:

Is that being eliminated,

Minister?

MR. KING:

At this point in time it is

maintained as vacant. We still have

it on the books, but we are not filling it.

MR. CROCKER:

Is that the only vacancy in

the Marketing, Enterprise and Outreach?

MR. KING:

Yes.

MR. CROCKER:

It is.

Okay.

Are

there any thirteen-week contracts in Marketing, Enterprise and Outreach?

MR. KING:

I can save you the trouble

there; I do not think there are any in the department.

I do not remember signing any in the last thirteen weeks.

MR. CROCKER:

Expediency of the minister

is perfect.

Professional Services, Minister, could you explain some of the Professional

Services that would be sought.

Could we obtain a list of the outside agencies that were enlisted to provide

these services?

MR. GENGE:

Those services are primarily writing and creative services that we need to

undertake our work, and delivering on trade shows and events and so on.

Those

services are really combined services of a number of contractors, Courtney Wells

being one and What Box Creative, I think, is the name of the other.

They are just independent contractors.

MR. CROCKER:

Okay.

Could you provide a list of the expenditures for independent contractors?

MR. KING:

I do not have it.

MR. CROCKER:

Are these Purchased Services

subject to the Public Tender Act?

MR. GENGE:

I would have to look. I am sure

they are.

OFFICIAL:

Yes.

MR. CROCKER:

Okay.

I guess we will move to 2.1.03, Trade and Investment.

The budget last year was $15 million, the expenditure was $9.5 million,

and this year's budget has been reduced.

I am wondering if the minister could explain the reduction of the $1.5

million from the Investment Attraction Fund.

MR. KING:

Sure.

We have made two commitments: one of a million dollars towards the

Digital Media Tax Credit, so we moved a million dollars out of there towards the

tax credit fund; and, also $500,000 to the Newfoundland and Labrador Film

Development Corporation for a TV series production.

MR. CROCKER:

So they were just moved to

other budget lines?

MR. KING:

Yes.

MR. CROCKER:

I wonder if the minister

could provide a list of this year's expenditure of the $9.5 million of Loans,

Advances and Investments.

MR. KING:

Sure.

The Atlantic Canada Regional Venture Fund was $2 million; DF Barnes

Fabrication Limited, $500,000; Desire2Learn Corporation was $1 million; Eastern

Composite Services limited, $500,000; Newfoundland and Labrador mobile, $397,000

I am rounding these a little bit by the way Roins Financial Services Limited

was

OFFICIAL : That is

not announced.

MR. KING: Which

one?

OFFICIAL:

(Inaudible).

MR. KING:

Sorry. Thank you.

The last one is not public knowledge yet, Mr. Chair.

I apologize for that.

I can provide it to you privately.

The total as well is $9.5 million.

There was also an additional $2.5 million expended there that was

transferred out; $1.4 million was for the Corner Brook Port Corporation that was

announced two weeks ago and $1.1 million was the Bonavista harbour development

just announced last week.

CHAIR: Okay.

MR. CROCKER: My

time has expired.

CHAIR: Your

time has expired, but if you are close to the end of this

section with another

question or two

MR. CROCKER: I

have maybe one more question. I was

wondering if the minister could provide a breakdown of Loans, Advances and

Investments. It is outlined as

three different categories. So of

the investments, which were of loans, advances or investments?

Are they all repayable loans?

Are they grants? Are they

subsidies?

MR. GENGE: We

would have to go back and look at the exact structure, but the bulk of the

investments are conditionally repayable loans or direct loans.

Gillian, we will have to look at the individual agreements

with each company to determine exactly what the breakdown is.

MR. CROCKER:

Okay. One final question: from

previous years, are the loans current in regard to repayment thirty, sixty,

ninety? Could you provide the

percentage of these loans that are past due, past thirty, sixty, and ninety?

MR. GENGE: We

will have to provide that information for you.

MR. CROCKER:

Okay. Thank you.

CHAIR: Okay.

Mr. Murphy.

MR. MURPHY: The

only questions I would have right now around these subheads, I think, would

probably be general policy questions.

Mr.

Minister, I am not quite sure if the Ireland Business Partnerships was covered

under this section. I was thinking

that it might have been covered under 2.1.01.

Can the minister give us an update on this initiative?

MR. KING:

It does not exist anymore.

MR. MURPHY:

It is gone, finished?

Is there any reason why they stopped that?

MR. KING:

No.

MR. MURPHY:

No?

Okay.

How

would you gauge the performance of the business partnership in itself then?

Would you say that it was a success or nothing worked out?

The reasons why it was stopped, was it simply economic?

There

were issues in Ireland, so I do not know.

It was being touted as one of the greatest things since sliced bread at

one particular time. I am just

wondering how come they would have halted the relationship.

MR. KING:

It is just an initiative

that ran its course and we did not renew it.

MR. MURPHY:

Okay.

I do not if I can ask any questions around the Immigrant Investor Fund

then. Can the minister give us an

update on the wrap-up of the cancelled Immigrant Investor Fund?

MR. KING:

Which head are you referring

to?

MR. MURPHY:

Well, I am not sure exactly

what head it would be under, whether you want to stick with that, or just

general policy questions of the government.

MR. KING:

I think the general policy

questions would be appropriate in the House of Assembly during debate.

This is about the Estimates, line by line.

MR. MURPHY:

Okay.

I guess that is it for the subheads.

You can call the next one.

CHAIR:

Okay, I will call the

subheads for 2.1.01 to 2.1.03 inclusive.

All

those in favour, 'aye.'

SOME HON. MEMBERS:

Aye.

CHAIR:

All those against, 'nay.'

Carried.

motion, subheads 2.1.01 through 2.1.03 carried.

CHAIR:

I return to Mr. Murphy to

continue in his time on sections 3.1.01 to 3.1.03.

MR. MURPHY:

Thank you very much, Mr.

Chair.

Under

Salaries, 3.1.01, Business Analysis, the Salaries are gone up a little bit here.

Well, sorry, the actual revised figure was $643,000 for the year against

$707,000 budgeted. This year it is

$723,000. So I am just wondering if

you can explain.

MR. KING:

Sure, yes.

The decrease this year was delayed recruitment for two positions, a

director and a manager. The

increase next year represents a 3 per cent salary increase, plus employees

moving up on the pay scale steps.

MR. MURPHY:

Okay.

Under Professional Services, $25,000 budgeted for, against $50,000 last

year, and only $20,400 was spent. I

wonder if you can tell us what those Professional Services were.

MR. KING:

I do not have those kinds of

operational details here of what the services were.

I can try and dig that out for you if you want.

MR. MURPHY:

Yes, if we can get a list of

them.

MR. KING:

I am more prepared to speak

to the numbers and what they represent.

You are drilling down into operational issues.

I would have to track that kind of information down.

MR. MURPHY:

Okay.

Under Purchased Services as well, $7,000 was budgeted for last year.

You only spent $500, but again you have $7,000 budgeted here for this

year. I am just wondering if you

can give us a breakdown on what may be anticipated spending here.

MR. KING:

Our budget is maintained

because of our historical spending in that area.

The decrease this current year from the budgeted to the actual represents

less than anticipated expenses, as well as an effort on our part to try to save

some money as part of cost reduction.

We typically do spend the full appropriated amount.

That is why we returned the budget to $7,000.

MR. MURPHY:

Okay, just a line under

provincial revenue under 3.1.01.

MR. KING:

Just to be clear, that

section is the same for every subhead. Purchased

Services; those are services that we buy.

It could be computer equipment, those kinds of things.

The Professional Services I explained earlier would be a little

different, but it is the same kind of services in the different subheads, just

so you understand that.

MR. MURPHY:

Okay.

As well, though, for Professional Services there is a distinct difference

for the Professional Services, but they could be different from department to

department. One of your aids was

talking about the subcontract of, what was referred to as creative writers I

think it was, at that particular time.

I am just wondering

MR. KING:

I guess what I am saying

though is in your question when you asked what kinds of things would you do

with Purchased Services, what I am saying is that it is the same answer all the

time. It would be meeting costs,

advertising for that particular division or

section of the department, printing,

and equipment rentals, things like that.

The Professional Services would be more to engage consultants and those

kinds of services.

They

will differ from division to division, but the explanation of what they are will

be the same. Whether it is in this

division or the next division, it is still going to be related to printing and

meeting and those kinds of things.

MR. MURPHY:

All right then.

Over to

3.1.03, under Loans, Advances and Investments, I take it nothing was granted in

this present year. Mr. Chair,

$16,229,000 was originally budgeted for, but only $3 million projected for this

year. I wonder if you could give an

explanation as regards to what is happening here.

MR. KING:

Sure.

No money was advanced in this fiscal year from the $16.2 million.

That represents the government's commitment to Canada Fluorspar, the St.

Lawrence mine.

MR. MURPHY:

That is where the Canada

Fluorspar money is?

MR. KING:

Yes.

MR. MURPHY:

We have not heard anything

from Canada Fluorspar recently though.

Is there any idea what is happening there?

I know there was a question asked in the House the other day.

MR. KING:

I do not represent the

company; I cannot speak for the company.

Our engagement with Canada Fluorspar is business dealing.

We have committed an amount of money based on their work progress.

It is not really fair for me to comment on their behalf, except to say as

their MHA at least, I understand work is progressing.

As I

said to my colleague last week, there is an increased workforce there over the

last number of months. They just

found a significant new deposit of fluorspar in the area.

They have a significant investment this past year from Golden Gate

Capital.

All

indications to us are that things are moving very good.

The world market is strong and they anticipate more activity in the next

three to four months more visible activity, I should say, to my colleague.

There are a lot of things happening, but not necessarily in the view of

public. They anticipate over the

next three or four months that there should be more public activity.

MR. MURPHY:

Okay.

Mr. Chair, I have no other questions on these particular subheads.

CHAIR:

Okay.

Mr.

Crocker.

MR. CROCKER:

Just a point of

clarification, Minister, right back to the beginning I guess.

The Salaries; are there two new positions or two positions being

MR. KING:

Subhead 3.1.01?

MR. CROCKER:

Yes, Minister.

MR. KING:

No.

What I had said was the decrease from budget to revised was a result of

the delayed recruitment of two positions.

Those positions have now been filled.

The increase represents the 3 per cent salary negotiated increase as well

as the normal pay level adjustment one gets from year to year.

MR. CROCKER:

Okay.

Further down in that section, Grants and Subsidies was budgeted last year

at $440,000, the expenditure was $366,000, and this year's budget is back.

I wonder if the minister could explain the types of Grants and Subsidies,

and also if he could provide a list of who would have received those Grants and

Subsidies?

MR. KING:

Yes, we can provide a list

to you. I do not have it today.

The decrease here in particular of $73,400 was less than anticipated

payout to the EDGE contracts.

MR. CROCKER:

The EDGE program falls in

here? Am I right, Minister, in

saying the EDGE program has not funded any projects in the past two fiscal

years?

MR. KING:

New ones you mean?

MR. CROCKER:

Yes.

MR. KING:

No, there have not been any

new ones.

MR. CROCKER:

The program still exists?

MR. KING:

Yes, for previous

commitments.

MR. CROCKER:

For previous commitments.

There are no new commitments from EDGE?

MR. KING:

No.

There have not been any in two fiscals.

MR. CROCKER:

My question is does the

program sorry.

MR. KING:

We have a breakdown of the

companies and what the anticipated cost will be to government, but those are all

earlier commitments. So the program

still exists by way of commitments on the book, but there has not been any new

EDGE status granted.

MR. CROCKER:

Is the program available?

Is it open to new entrants?

MR. KING:

Yes, I think so.

I hesitate because I have not seen any, but I guess it is.

MR. CROCKER:

I am not sure if this is the

right fund or not. I am just

wondering if the minister could update us on the status of the

Cape Dorset .

Is the Cape Dorset factored

into any of these numbers and the loan repayment?

MR. KING:

No, it is not in this

particular subhead. I will see if I

can track it down. That is in the

Business Investment Corporation.

MR. CROCKER:

Okay.

So we can ask about it a little later?

MR. KING:

We can address it now, if

you would like.

MR. CROCKER:

Okay.

MR. O'RIELLY:

I guess the question that

you are asking is what happened with the funding for the

Cape Dorset ?

MR. CROCKER:

Well what is the status of

the equity investment? We know that

payment was supposed to commence on March 31, 2015.

I am just wondering if payment has commenced on the loan.

Just a question around the idea of the boat sank.

Was there an insurance policy in place?

If there was an insurance policy in place, were we named on the insurance

policy for our investment in the vessel?

MR. O'RIELLY:

There was an insurance

policy in place.

MR. CROCKER:

There was?

MR. O'RIELLY:

There was, and the Province

was named on the policy. The

company approached the Province and asked for a conversion of the money to a

debt instrument rather than an equity instrument, which was agreed to.

Payments were, as you indicated, due to begin, which they have.

Payments have been received.

MR. CROCKER:

Okay.

That investment was converted.

The $2 million was converted over?

MR. O'RIELLY:

Yes.

MR. CROCKER:

Okay, into that.

Is that an interest-bearing loan?

MR. O'RIELLY:

Yes it is.

MR. CROCKER:

Are the terms of the loan

fixed?

MR. O'RIELLY:

Yes.

MR. CROCKER:

Are they available?

MR. O'RIELLY:

I think so.

It is the standard funding, 3 per cent interest rate and so on.

MR. CROCKER:

Okay, amortization period?

MR. O'RIELLY:

I would have to double check

on that. I think I know what it is,

but I should not guess at it.

MR. CROCKER:

Okay.

Thanks

I am

just going to come back, I think, to 3.1.02.10.

The Grants and Subsidies were budgeted at $3.6 million, the expenditure

was exactly the budget, and it is the same budget this year.

I just wonder if the minister could explain what those Grants and

Subsidies are, and also provide a list of who received those Grants and

Subsidies.

MR. O'RIELLY:

We would have to get a list

for you to give you a good briefing on what is in that list.

There is a variety of different business assistance grants provided.

MR. CROCKER:

Okay.

Could the minister also provide, with regard to that portfolio and the

assistance that has been paid out, if in fund of loans the status of the loans,

thirty, sixty, ninety? What loans are actually past due?

MR. O'RIELLY:

Normally these are repayable

contributions, or a structure of some sort of grant.

I think the question you are really asking is what is the performance of

them? Are they compliant with the

rules?

MR. CROCKER:

Yes, the performance of the

fund.

MR. O'RIELLY:

Yes.

MR. CROCKER:

Thank you.

Just

moving to 3.1.03, it is the Canada Fluorspar money.

I wonder if the minister could tell us, the reduction of the $16 million

that was budgeted last year and in previous years for the commitment to Canada

Fluorspar back in 2011, the $3 million that is budgeted this year, is that

budgeted for Canada Fluorspar, or is that budgeted for other strategic

investments?

MR. KING:

That

section is exclusively

Canada Fluorspar.

MR. CROCKER:

The anticipation is Canada

Fluorspar would not draw down any more than the $3 million this year.

MR. KING:

Yes.

MR. CROCKER:

So the commitment remains to

Canada Fluorspar, just that the money has been yes, a little over $13 million

has been moved out of the department's budget.

MR. KING:

That is correct.

We have cash flowed it over a longer period of time, over three years,

anticipating they would not draw down any more than $3 million.

If, in fact, they do need more than $3 million, then we will obviously

honour our commitment. We will have

to find a way to do it. Based on

what we have seen and discussions we have had, we do not anticipate any more

than $3 million.

MR. CROCKER:

The commitment remains to

Canada Fluorspar for

MR. KING:

For the full amount.

MR. CROCKER:

the little over $16

million.

MR. KING:

Yes, that is correct.

MR. CROCKER:

We are good there.

CHAIR:

Okay, so we are good there.

Mr. Murphy had already said he was good with

section three.

MR. MURPHY:

I just have one more

question.

CHAIR:

One question in

section

three?

MR. MURPHY:

Yes, it is with regard to

the EDGE program the minister was talking about just a minute ago.

We were told last year there were twenty-eight businesses that were

currently enjoying the benefits of the EDGE program.

At that particular time you told us there were four businesses, I think,

that were after making application to the department that they were looking at.

I am

just wondering if we can get an update on those four businesses and why they

would have dropped out, or if there has been no opportunity taken up of the EDGE

programming, as of late. Is the

program dead? What is happening

with it?

MR. KING:

I am not aware of the status

of the applications. As I said a

few moments ago, the program is not dead, but we have not approved any new ones

in four years.

I think

your line of questioning is more outside of Estimates now and into the

operations of the department. I

could not tell you the status of any individual application that might be on

someone's desk being processed.

MR. MURPHY:

Okay.

That was it.

CHAIR:

I call Estimates 3.1.01 to

3.1.03 inclusive.

All

those in favour, 'aye.'

SOME HON. MEMBERS:

Aye.

CHAIR:

Contrary, 'nay.'

Carried.

motion, subheads 3.1.01 through 3.1.03 carried.

CHAIR:

There has just been a

request from the Broadcast Centre to take a break right now, if it is good with

everyone. Some equipment has been

moved down there from the problems they were experiencing earlier this morning.

We will

come back in approximately ten minutes and start on 4.1.01.

Recessed.

Recess

CHAIR:

We will resume now.

There are two sections there, 4.1.01 and 4.2.01.

I will

start with Mr. Crocker, I guess.

MR. CROCKER:

Thank you, Mr. Chair.

We will

start with 01. Minister, the

budgeted Salaries for the last fiscal year was $926,000 and the actual was

$918,000. There is a substantial

reduction this year. I wonder if

the minister could explain the roughly $180,000, I think, reduction in Salaries

- $172,000, sorry.

MR. KING:

Sure.

The difference from the budget to the revised was delayed recruitment

savings. The change from the

budgeted to $746,000 is the result of the attrition management plan.

We are hoping to find savings there.

MR. CROCKER:

Okay.

Are there a number of positions, Minister, that are leaving that portion

of the department through attrition?

MR. KING:

That is our hope.

You will find in a number of sections here we have identified salary

decreases as a result of attrition.

We may end up having to move Salaries around, depending on which positions

become vacant and we do not fill.

It is a little bit of an estimated plan on our part, knowing where some

potential retirements may come from.

Before

you move on, I just want to make a clarifying comment from earlier for the

record. On the Professional

Services, a question was asked by one of you and I cannot remember who.

In order to engage Professional Services we are governed by the

guidelines for hiring external consultants.

It is not public tender, but there is a government policy on hiring

consultants.

order to engage in Purchased Services we have to follow the Public Tender Act.

I just wanted to clarify for the record because I think either myself or

the deputy might have said otherwise.

Thank

you. Sorry to delay it.

MR. CROCKER:

Thanks, Minister.

Minister, back under Professional Services again the budget was $35,000, and

revised was $61,000. Could the

minister explain why the drastic increase in Professional Services in that part

of the department last year?

MR. KING:

That one is a result of

evaluation of the Rural Broadband Initiative.

There were higher costs than we anticipated when we had a consultant do

an assessment for us.

MR. CROCKER:

Is that assessment or that

report available, Minister?

MR. KING:

I will have to get back to

you on that. I am just trying to

figure out the nature of the reports.

I can get back to you on it.

MR. CROCKER:

Okay.

MR. KING:

There may be some

proprietary information that we cannot release.

Rather than say no or yes, let me get back to you.

MR. CROCKER:

Okay, thanks Minister.

MR. KING:

I will flag that one for the

record.

MR. CROCKER:

Actually, Minister, was

there anything in those Professional Services done on rural broadband?

Was there anything done on cellphone coverage in the Province in that

study?

MR. KING:

I will let Mark speak to

that, if you do not mind, Mark Ploughman.

MR. PLOUGHMAN:

This would have been the

technical evaluation of the proposals that were received under the call.

If we had proposals in that call that had cellular components to it, then

it would be wrapped in that. It

would not be an analysis of cellular in the Province; it is just an analysis of

the calls or proposals that came in under the call.

MR. CROCKER:

Am I correct in saying there

were cellphone proposals in that call?

MR. PLOUGHMAN:

Yes, you are.

MR. CROCKER:

They were all declined or

moved out, did not qualify under the program?

MR. PLOUGHMAN:

We are still in negotiation

with Bell Mobility over some possible projects.

MR. CROCKER:

Has there been funding

allocated in this year's budget for such projects?

MR. PLOUGHMAN:

Yes.

MR. KING:

It is about $900,000.

MR. CROCKER:

So there has been $900,000

allocated in this year's budget for cellphones.

MR. KING:

No.

MR. PLOUGHMAN:

Not for cellphones.

What we do is we look at broadband in general, broadband in communities.

That can be delivered through a number of different technologies.

Cellular is one of them.

In our

carry-over we have about $900,000 remaining for additional projects, but we will

be tying those into the national Connecting Canadians program, some of those.

That is a federal Industry Canada-driven program.

The call for that closed earlier this year and they are currently

evaluating those right now.

MR. CROCKER:

Okay.

Could you tell us where the $900,000 shows as a budget item?

MR. KING:

It is under Grants and

Subsidies, 10. What we are showing

there is a carry-over of $1.637 million.

Mr. Chair, $900,000 of that would be new money for the current broadband

initiatives and $700,000 is already committed projects.

MR. CROCKER:

Okay, thank you, Minister.

Purchased Services was budgeted at $15,000 and it was $207,000.

I wonder if the minister could explain the huge increase in Purchased

Services.

MR. KING:

Sure.

That was predominately a result of costs to do some maintenance and

repair work to the Atlantic Cable Facility.

We are a co-owner of the ACF with Eastlink and so the bulk of that money

was repairs that had to be carried out there.

MR. CROCKER:

To the cable, the link?

MR. KING:

Yes.

MR. CROCKER:

Could the minister explain

the facility? That is an agreement

we have with Eastlink?

MR. KING:

It is a facility, a property

that we own, a physical cable.

MR. CROCKER:

Yes.

MR. KING:

Mark can probably give you a

little better explanation.

MR. PLOUGHMAN:

The Atlantic Cable Facility is the fibre optic cable that runs from St. John's

to Halifax and all of the equipment that is on the way.

There are two routes: there is one terrestrial route, which more or less

follows the highway; and then the other route is a southern route, which follows

the South Coast of Newfoundland and Labrador.

Cable breaks are something that is not uncommon for subsea

fibre optic cables. Often it is as

a result of fishing activity or something like that.

MR. CROCKER:

You say they are not uncommon, but after spending over $200,000 last year, we

just went back and budgeted just $15,000 again this year.

MR. PLOUGHMAN:

It is not an item that is easy to predict.

Because of that, it is a contingent expense.

MR. CROCKER:

Okay. Could the minister tell us

who would normally complete that work?

Is it completed by Eastlink themselves and we are billed, or is it

something we contract?

MR. KING:

Eastlink.

We are billed.

MR. CROCKER:

Would that be subject to

public tendering, or does Eastlink just have free rein at the amount of the

bill?

MR. KING:

They have responsibility for

maintaining it as part of the agreement.

MR. CROCKER:

Okay.

I guess my question though is does Eastlink just send us the bill?

There are no quotes. They

have free rein to charge, more or less, as they feel fit for the repairs.

MR. PLOUGHMAN:

This is all prescribed in an agreement which is called an IRU, Indefeasible

Right of Use. So it describes the

There

are only one or two companies in the world that actually have the capability to

do these subsea cable repairs. They

generally have these on contract and on standby.

A cable break is a loss of telecommunications for a region, so the

repairs are fairly urgent.

Generally, it is a standing contract they have in place with a single vendor.

MR. CROCKER:

Okay.

In Grants and Subsidies, the $1.6 million, is that all carry-over money,

Minister? Or is there new money in

that $1.6 million in the Grants and Subsidies?

MR. KING:

It is all carry-over.

MR. CROCKER:

It is all carry-over.

There is no new money?

MR. KING:

Yes.

The $900,000 that I referenced earlier, we chose not to spend that in the

current fiscal because the federal government came in with the Connecting

Canadians fund that you may be aware of.

It allows us the opportunity to leverage money and thereby do more

projects with the money we have.

Hypothetically, for $900,000, if we were going to do four projects or five, this

might give us ten or eleven projects now.

We have carried over waiting to hear from the feds on what they are

looking to fund. Mark?

MR. PLOUGHMAN:

Yes.

MR. CROCKER:

Okay.

My time has expired.

CHAIR:

Okay.

Mr. Murphy.

MR. MURPHY:

Thank you, Mr. Chair.

Under

section 4.2.01, Sector Development, Salaries was $783,000.

Last year it was budgeted for $858,000 and the actual was $812,000.

I wonder if we can get a breakdown of what is happening here on this

line.

MR. KING:

The difference last year was

delayed recruitment for positions which gave us some savings.

The number for next year represents attrition management and some

anticipated planned savings.

MR. MURPHY:

You are obviously looking at one or two job positions here.

Do you have any idea right now of what their present roles are?

MR. KING:

No.

MR. MURPHY:

No.

So it is just that they are hoping to get somebody somewhere.

MR. KING:

Through attrition we have a

list of employees who are eligible to retire.

So we have used that as the basis of trying to target sectors of the

department where we might find savings.

MR. MURPHY:

Okay.

MR. KING:

As I said a few moments ago

to my colleague from Trinity Bay de Verde that may change over the course of

the year. Under the plan we had to

find six positions and we are still working our way through managing where that

might come from. For budget

purposes, we had to identify some potential savings.

We have done that in areas where we think there could be potential

retirements.

MR. MURPHY:

Okay.

Under Professional Services there was a $50,000 drop over the last fiscal

year 2014-2015. Your Estimates are

only showing an increase from that $10,000 to $20,000.

I wonder if we can get a breakdown on what is happening on this line.

MR. KING:

Similar to the previous

section we had less than anticipated expenditures.

Here in particular, we were looking at doing a supplier development

opportunity with the Voisey's Bay Project.

That did not happen. It has

been pushed off so we found savings there.

For next year, again we anticipate we wanted to find some savings

that we can get through here with $20,000 based on historical patterns.

MR. MURPHY:

Could you explain what that

Supplier Development Program was all about?

Do you have any details on that?

MR. O'RIELLY:

Yes, that program will allow

us to work, in this case, with Vale to look at what their requirements are going

to be on this project as they go forward.

They will be obligated to work with us and the Department of Natural

Resources to identify the various services and equipment and so on that they

will require. That will allow us

the opportunity then to work with the business community to figure out who in

our community has the capacity already, or can acquire the capacity to respond

to those opportunities.

It really is about trying to help the local business community enter the supply

chain of Vale. Of course we are

hopeful that in so doing there will be ongoing opportunities, not just for the

underground project that Vale is now contemplating, but perhaps other

opportunities going forward on a global scale.

MR. MURPHY:

Okay.

I am just wondering then overall in the department I have no other

questions around line items, but what else the Strategic Industries Development

department might be looking at?

MR. KING:

You are into more policy

here now.

MR. MURPHY:

I am just wondering what else

MR. KING:

Yes.

I think the House of Assembly would be the appropriate place for that.

The Estimates is more focused on the budget and the expenditures.

I think you are asking about policy of government and where our policy

direction might be.

MR. MURPHY:

Yes.

Okay.

Back

in, then, under Transportation and Communications, Minister, $72,000 was spent

against $101,600 that was actually budgeted.

I wonder if we can get a breakdown of what is happening here.

The request is in for $73,600.

MR. KING:

The decrease this year

represents some deliberate savings as a result of some discretionary travel and

less than anticipated costs. Next

year's budget we tried to reflect closely to this year what we anticipate we

will use.

MR. MURPHY:

I am just wondering at the

same time, it has to be hard to carry on business if you are not travelling and

meeting people face to face. I just

wonder, with all the changes in the department I do not know how you are doing

it.

There

have been a lot of changes over at the department in the last little while,

additions and taking various things out of the department as well.

It just does not seem to be how shall I say it?

It seems like it is on a shaky foundation.

I am wondering if you can address that.

MR. KING:

I can address it; I am just

not sure this is the setting for it.

I certainly categorically disagree with you.

The merger of the two departments has gone extremely well.

We have very focused lines of business and we are doing our work.

mentioned before on transportation because that is what initiated your

question that there is an overall reduction of about $350,000, but the budget

is still $1.964 million for travel.

We are more than confident that we can carry on our duties and our

responsibilities with that budget.

MR. MURPHY:

Okay.

I have no other questions, Mr. Chair, on the line items.

CHAIR:

Okay.

Is there a follow-up question from the Opposition?

MR. CROCKER:

I just have one more

question actually. This is an

Access to Information document.

The

department has been actively involved with the innovation strategy since 2006.

Since 2006, over $17 million has been invested to support projects

through the innovation strategy, not including broadband initiatives.

I am just wondering if the minister could provide a list of those $17

million in investments.

MR. KING:

What line would you be

referencing there for innovation?

MR. CROCKER:

I guess innovation as a

whole. This is a piece of

information from the department itself, accomplishments by the department.

MR. KING:

Right.

What document are you referencing?

MR. CROCKER:

It is provincial government

accomplishments by department and was published November, 2014.

It speaks specifically to innovation.

MR. KING:

What is the language again?

MR. CROCKER:

The department has been

actively driving government's innovation agenda since the release of its

innovation strategy in 2006. Since

2006, over $17 million has been invested to support projects through the

innovation strategy, not including broadband initiatives.

MR. KING:

You are requesting back to

2006?

MR. CROCKER:

Yes, the $17 million that

the department is saying went in that strategy.

MR. KING:

Sure, okay.

MR. CROCKER:

Move on to the next.

CHAIR:

Concluded.

Shall

items 4.1.01 and 4.2.01 carry?

All

those in favour, 'aye.'

SOME HON. MEMBERS:

Aye.

CHAIR:

Contrary, 'nay.'

Carried.

motion, subheads 4.1.01 and 4.2.01 carried.

CHAIR:

We will move to

section

five. There are three subsections

here.

Mr.

Crocker to continue with your time.

MR. CROCKER:

Thank you, Mr. Chair.

I think

we are going to move to 5.2.01 and this is Field Services.

I am just wondering if the minister could tell us the Salaries in this

part of the department have increased from a little over $4 million to

$4,328,000. I am wondering if the

minister could explain the increase in Salaries.

MR. KING:

Sure.

Predominately, it is because of the 3 per cent salary increase and the

anticipated step level increases for employees progressing through the step

system.

MR. CROCKER:

Could the minister give us

the number of staff, permanent, temporary, and contractual in those salaries?

MR. KING:

We will have to get that for

you.

MR. CROCKER:

Okay, as well, the number of

offices that these salaries would be paid to and the number of ITRD offices in

the Province, currently.

MR. KING:

There are twenty-two in

total.

MR. CROCKER:

Twenty-two in total.

Does the minister have a breakdown of the activity by office?

MR. KING:

Can you be more specific?

MR. CROCKER:

Is there a measuring tool

that the department uses to gauge the activity in each of these offices?

MR. KING:

I think you are probably

outside the parameters of Estimates there.

You are talking about departmental operations.

MR. CROCKER:

Okay.

Come down to the line of Purchased Services, I am just wondering what the

Purchased Services would be? With a

budget of $900,000, an expenditure of $695,000, and a budget again of $868,000,

could the minister explain the almost $1 million in that

section of the

department for Purchased Services?

MR. KING:

Sure.

That

section for Purchased Services would cover things like copiers,

shredding, vehicle repairs, and leases for our offices around the Province.

MR. CROCKER:

Could the minister give us

the number of vehicles that the department would have in the field?

MR. KING:

We will have to get that for

you.

MR. CROCKER:

We will move to 5.3.01.

Last year we had budgeted a little over $9 million for Grants and

Subsidies, the expenditure was $11.6 million, and this year the estimate again

is a little over $9 million. I am

just wondering if the minister could tell us what is funded here.

What was funded last year for the $11 million?

MR. KING:

Sure.

The difference between the budgeted and the actual expenditures reflects

the transferring of the monies I mentioned earlier for Bonavista and the Corner

Brook Port Corporation. The

budgeted for this year is back to the previous year's amount, just shy of

$100,000 that we are going to find in savings.

MR. CROCKER:

So the extra last year would

have been Bonavista and

MR. KING:

Yes.

MR. CROCKER:

Could the minister provide a

list of the Grants and Subsidies for this development or this fund?

MR. KING:

We will compile it.

It is over 200. We will get

it for you.

MR. CROCKER:

Okay, I appreciate that.

That is

it for me, Mr. Chair.

CHAIR:

Mr. Murphy.

MR. MURPHY:

The only question I have is

around Transportation and Communications.

Just to review, 5.2.01, $194,000 spent, and $304,100 anticipated spending

for this year. I wonder if we can

get a breakdown on that number again.

MR. KING:

Yes.

So the reason for the reduction was a focus on trying to find savings and

efficiencies in the latter part of the year and the freeze on discretionary

travel. As I said before, we have

adjusted our Transportation and Communications budget overall in various parts

of the department by $350,000. In

this particular

section we budgeted what we believe we need to carry out the

duties.

MR. MURPHY:

Okay.

No, I think that is it. I

think we have everything. No sorry,

one

section under Transportation and Communications, 5.1.01.

It was $54,100 less than anticipated last year, but still budgeted for

the same this year.

MR. KING:

It is the same thing,

targeted savings. Also, here we had

some savings as a result of the WSEP, a federal program.

As I said a freeze on discretionary travel would have been targeted there

as well.

MR. MURPHY:

Okay, so that was for

2014-2015. What they are saying I

guess with this number, the $89,100, is that there is no longer a freeze on

discretionary travel? Why would

that number still be $89,100 if there was not a freeze?

MR. KING:

The answer is the same as

the one I just gave you on the previous section.

We reduced our overall transportation by $350,000.

We reduced in areas that we feel we can manage.

We have maintained budgets in areas where we feel we need to maintain

them. The answer to this question

is identical to the previous one; we believe we need the $89,000 maintained

there.

MR. MURPHY:

Okay.

I do not understand. If

there were targeted savings of $35,000 you had budgeted $89,100, so do you

anticipate obviously spending $89,100 this year?

MR. KING:

We do.

That is correct.

MR. MURPHY:

Okay.

MR. KING:

Some of the savings were the

result, as I alluded to, of a federal government program where we received some

assistance this year for travel as well under the federal government program

WSEP. That is no longer available

to us. In addition to needing the

extra money, we have to compensate for that as well.

MR. MURPHY:

Okay.

Mr. Chair, those are all the questions I have on the line items here.

CHAIR:

Shall items 5.1.01 to 5.3.01

carry?

All

those in favour, 'aye.'

SOME HON. MEMBERS:

Aye.

CHAIR:

All those against, 'nay.'

Carried.

On motion, subheads 5.1.01 through 5.3.01 carried.

CHAIR:

Mr. Murphy still has time on

the clock so we will let him start 6.1.01.

There is only one

section to that.

MR. MURPHY:

Thank you, Mr. Chair.

Under

section 6.1.01, $481,600 was budgeted, the actual was $367,700, and you are

anticipating $389,100 for this year.

Can I get a breakdown of what is happening there?

MR. KING:

Sure.

The less than budgeted this year was the result of a delay in

recruitment. The lower amount for

next year is the result of the attrition management plan.

MR. MURPHY:

Okay.

Under Professional Services in the same

section there was $190,000

budgeted. Well, it is actually

right across the board. What is

this money appropriated for?

MR. KING:

Under Professional Services?

MR. MURPHY:

Under Professional Services.

MR. KING:

Similar to what I have said

in other categories. That is where

we purchase any professional services, consultants, those types of things

outside the department.

MR. MURPHY:

What was purchased last year

that necessitated the $190,000?

MR. KING:

I do not have that list here

in front of me.

MR. MURPHY:

Can I get it, please?

MR. KING:

Sure.

MR. MURPHY:

Under Purchased Services

there was only $1,900 that was spent against $40,000 budgeted this year.

Can you tell me what is going to be happening this year that would

necessitate that spending?

MR. KING:

The reduction was targeted

savings. We pulled back from a

number of conferences and trade shows that we would have attended under this

section. The increase actually

reflects some funds reallocated from our policy and planning division.

We anticipate higher expenditures there than we had the current year.

MR. MURPHY:

The decision to pull out of

trade shows and conferences, was that a good decision here in this case?

You are talking ocean technology and Arctic opportunities, and I strongly

believe the government was on the right track when it came to the Arctic

opportunities, the Northern Gateway Initiative and everything.

seems like it is self-defeating to be pulling out of these conferences at a time

where you would actually lose I guess you could say a foothold on that

issue.

MR. KING:

So to be clear, we did not

pull out of all tradeshows and opportunities.

The other thing that happened here is there were three, if not four,

significant events that we would normally have travelled to, but we were lucky

enough to secure hosting the conferences here.

So obviously our travel that would have been budgeted for those

particular conferences would have not been required.

MR. MURPHY:

Okay.

So the conferences on the go here this year, that would be covered under

the $40,000 line item that you have here now?

MR. KING:

Which particular conference

are you referencing?

MR. MURPHY:

The one at the Delta, the

oh my.

MR. KING:

The one I referenced in the

House?

MR. MURPHY:

Yes.

MR. KING:

The one I referenced a while

ago, the Arctic Technology Conference?

The one I attended?

MR. MURPHY:

Yes.

MR. O'RIELLY:

I can speak to that one.

MR. KING:

Okay, go ahead.

MR. O'RIELLY: The

expenditures in the current fiscal year are some that came from the attendance

at the ATC event in Copenhagen.

Some of the other events for the year would probably be much more normal.

As the minister pointed out, we have a number of events

that are taking place in the Province, three major conferences that had been

secured last year, this year, and again next year.

So it helps reduce some of the travel budget.

We are actively participating in all major events on the Arctic front and

in oceans technology, which also comes from this same budget subhead.

MR. MURPHY:

Okay. I have no other questions on

6.1.01 unless the Opposition

CHAIR: The

Opposition?

MR. CROCKER:

Just a couple.

For clarification the ATC that we are hosting next year, we do not pay

for that? That is not a government

expenditure? That is the

association?

MR. O'RIELLY:

There is an organization committee that holds it and we make application to host

the event. We pick up some of the

cost, usually receptions and things of that nature, to induce them to come here,

but it is their budget and their activity.

MR. CROCKER:

So I guess our contribution

to that is budgeted here?

MR. O'RIELLY:

Yes. Well not in Transportation and

Communications, no.

MR. CROCKER:

Where would it be budgeted to there?

MR. O'RIELLY:

It may be something we would spend on Purchased Services, if it was

participating in a booth for instance and that kind of thing.

MR. CROCKER:

Okay, back to the Salaries. Could

the minister provide a copy of numbers of staff, both permanent and temporary,

in the Ocean Technologies branch of his department?

MR. KING: Sure.

MR. CROCKER:

Just one final question. Funding

for OceansAdvance, does this come from this portion of the budget for the

department?

MR. KING: No.

MR. CROCKER:

Could the minister tell us

where the funding for OceansAdvance

MR. O'RIELLY:

The Regional Development

Fund.

MR. CROCKER:

The Regional Development

Fund. That is good for me.

CHAIR:

Shall 6.1.01 carry?

All

those in favour, 'aye.'

SOME HON. MEMBERS:

Aye.

CHAIR:

All those against, 'nay.'

Carried.

On motion, subhead 6.1.01 carried.

CHAIR:

We will move now to 7.1.01

to 7.1.04.

We will

start with Mr. Flynn, I believe, in this section.

MR. FLYNN:

I thank the minister and

staff for taking the time this morning to come out.

There are a few familiar faces there that I have had the pleasure of

socializing with over the years. We

will leave it at that.

Just as

a quick look at this, how many people or how many staff is in the department at

present?

MR. KING:

In this division you mean?

MR. FLYNN:

In the tourism division,

because it is a little bit hard to go from that now with the realignment of

MR. KING:

Sixty-five permanent,

seventeen temporary, and 125 casual.

MR. FLYNN:

Sixty-five permanent and

seventeen part-time?

MR. KING:

Temporary.

MR. FLYNN:

Oh temporary.

In the attrition notes that I had here, there are going to be six people

from all over the department, I guess is what they are looking at.

Have you identified any of those who will not be replaced in the

department of tourism at this point?

MR. KING:

The division of tourism?

MR. FLYNN:

Yes, the division of

tourism.

MS MURPHY:

We have identified upcoming

retirements and we are looking at what the possibilities might be, but there is

no final decision made. We have to

achieve a six-person target across the department before March 31.

MR. FLYNN:

Is that just the department

of tourism then?

MR. KING:

The division.

MR. FLYNN:

The division.

MS MURPHY:

The division, but this

analysis is being done across the whole department.

MR. FLYNN:

Okay.

While we are on persons, I was going down through the minutes of last

year's meeting when the minister made a reference to or I guess one of us

asked about the position in Labrador.

At that time, the minister said it would be filled within the next few

weeks. That position obviously was

not filled last year. Will it be

filled this year?

MR. KING:

I cannot say for certain.

Possibly, but I cannot say for certain at this point.

MR. FLYNN:

We would like to get detail

on the Professional Services that are budgeted there.

Last year it was $233,000 and spent $53,100, but now we are back up to

$183,000. What got cancelled or

delayed last year? What is the

planning for that this year?

MR. KING:

Carmela will speak to that.

MS MURPHY:

Stelman that actually reflects the marketing research budget; that Professional

Services account. That fluctuates

on an annual basis depending on the research we are doing.

We do a lot of partnership research with the Canadian Tourism Commission,

Stats Can, and Phocuswright, and then every five years we do an exit survey.

Last

year would have been the lowest level of the research partnerships because

certain three-year programs finished up.

Now we will be going into bringing those back on this year.

As a matter of fact, we are going into an exit survey year, so we will

likely be transferring money into that account next year to pay for the one-time

exit survey.

MR. FLYNN:

So, the auto and air exit

survey will be completed this year?

MS MURPHY:

The RFP is out now.

MR. FLYNN:

Okay, perfect.

It takes away a question I had there for you probably a little bit later

MS MURPHY:

Your next question; we will be including Labrador.

MR. FLYNN:

No, I was not going to ask

that one. I just assumed that you

would.

I am

assuming that the budget for the marketing dollars itself which is nice to see

the $2 million put back in this year and which is going to be $12 million.

There are certain areas obviously you allot money for.

It might be in your website maintenance or your purchase for placement of

TV or newspaper ads. Is there a

breakdown available that you can provide us on how that $12 million is actually

spent?

MR. KING:

The breakdown would roughly

be: for advertising, creative media, TV, newspaper, magazines and those kind of

things, $7.8 million; for travel guides, brochures, booths and posters it would

be $500,000; for the Travel Media Program, $250,000; for industry support, HNL,

the Tourism Board, and DMOs it would be $1.1 million; the Atlantic Canada

Tourism Partnership, $480,000; the hunting and fishing campaign, $400,000;

tourism information, call centres, and distribution, $150,000; website and

Internet marketing, $1 million; and travel, trade and sales would be $575,000.

MR. FLYNN:

I noticed you said the

regional marketing boards in so many dollars.

Under 7.1.01 we have Grants and Subsidies there which are kind of outside

of everything else in that. I think

I know what the answer is. What is

that $150,000 for?

MR. KING:

That one is for Destination

Labrador.

MR. FLYNN:

Why would that be treated

differently than the other marketing organizations?

MS MURPHY:

We were funding Destination

Labrador through the department, through a commitment by the government long

before we moved into the new DMO process.

That was set up as a grant.

When we went down the road of partnering on the Tourism Board and the other

DMOs, they came out of the marketing budget out of Purchased Services.

They are not a line item as a grant like Destination Labrador was.

It is an administrative matter.

MR. FLYNN:

It is just an administrative

thing, is it?

MS MURPHY:

Yes.

They all get treated the same and they all get the same amount.

MR. FLYNN:

Is it appropriate to ask I

am sure you will tell me if it is not.

Is it appropriate to ask for a detailed breakdown of okay, we spent

this much money on CTV in Ontario kind of breakdown, line by line the way that

marketing dollars were spent?

MR. KING:

Anything is appropriate to

ask.

MR. FLYNN:

Well, can we have it then?

MS MURPHY:

I am sure we could provide a

summary of that. It is not that we

would not provide it; we do not get asked for it that often.

It becomes more of a competitive issue of not putting all our cards out

in the marketplace in a public way.

There is some competitiveness around some of the buys we do from a costing point

of view, but I have no issue with providing a

summary of the media plan at a

certain level with the media and the amounts.

MR. FLYNN:

Okay.

Are there any new ads being produced this summer?

MS MURPHY:

Well we have just restored

the budget which is really exciting.

MR. FLYNN:

Okay.

MS MURPHY:

There you go.

We are doing it.

MR. FLYNN:

I know, we are looking at

the time here.

That is

all I have right now. If there is

something comes up that I

OFFICIAL:

You can go on.

MR. FLYNN:

I can go on?

For

example, we are providing and I am not saying it should not be done, I am just

asking the question East Coast Trails with $100,000 for marketing.

Do we do that with other trails across the Province?

I will wait for your response.

MR. KING:

No, we do not.

MR. FLYNN:

So is there any particular

reason why we chose one trail over another trail?

MS MURPHY:

That was set up a very long time ago because it was considered a destination

trail. There are other trails

receiving funding, they are just receiving it through other programs in the

department like the Regional Development Fund.

MR. FLYNN:

Okay, because I had a

printout of it and I cannot recall seeing where other trails might have gotten

that money. That is fair.

Salary

allocations; I remember reading a report sometime back and there did not appear

to be a great system in place for overtime.

There was a fair amount banked in overtime.

I will check my notes here.

Have we been able to tighten up some of the areas that may have been slack on?

MR. KING:

Can you be more specific in

what you are asking? That is a very

vague question.

MR. FLYNN:

No, I cannot.

There was a substantial amount that went in the budget from last year in

allocating overtime and severance packages.

We would not want to get through half the year and find out we have to

pay $1 million out for these unallocated or 'unexpensed' liabilities.

MR. KING:

We are confident that the

allocation we have there in our Salaries will be adequate for the year.

MR. FLYNN:

Okay.

That is good for now.

CHAIR:

Mr. Murphy.

MR. MURPHY:

Mr. Chair, under

section 01,

under Salaries, $1.669 million was spent against the actual $1.76 million under

7.1.02, and you have gone and budgeted $1.8 million; an increase.

I wonder if we can get an explanation on that line.

MR. KING:

Sure.

So the decrease this year was a delayed recruitment effort for staff.

The increase next year is a result of funding for a full complement of

staff, factoring in a 3 per cent wage increase and step adjustments.

MR. MURPHY:

So you do not anticipate any

layoffs in this particular branch?

MR. KING:

We do not anticipate any

layoffs at all. The only way there

would be less staff is through attrition.

There will not be any layoffs.

Where we anticipate that might occur is where you would see the salary

reduction in the different heads.

MR. MURPHY:

Okay.

Under Purchased Services as well, if I can get a breakdown of that;

$340,600 is expensed for this year and $311,600 was spent.

I am just wondering if you can give me a breakdown of that line.

MR. KING:

We do not have it here, but

we will endeavor to get it for you.

MR. MURPHY:

If we can get that, under

Purchased Services. You do not know

right off hand exactly what the money was appropriated for then if that is the

case, if you do not know.

MR. KING:

That is correct.

MR. MURPHY:

Okay.

Under Grants and Subsidies again, would I find money in here for the

Bonavista Townscape in this particular line item?

MR. KING:

No, we just dealt with that

one a couple of sections back.

MR. MURPHY:

Okay, I missed that.

Thank you for that.

Under

section 7.1.04, then, that is moved from the marketing arm.

The Marble Mountain Development Corporation, 7.1.04, the $1.3 million

under Grants and Subsidies; there was $2 million spent.

I take it this is for the chairlift?

MR. KING:

Yes, correct.

MR. MURPHY:

Okay.

So the $1.36 million is also going towards the chairlift?

MR. KING:

Yes, the total, $3.36 million.

MR. MURPHY:

Was this the original cost

that was put out? I do not think it

was the original cost, was it? Did

I hear something about an overrun on the lift?

It was originally $3.3 million?

MR. KING:

Yes, just cash-flowing it

over two years.

MR. MURPHY:

Okay.

Was this tendered, or did they do a cost comparison with other

manufacturers at the same time as that?

MR. KING:

I cannot speak for Marble

Mountain on that.

MR. MURPHY:

No?

MR. KING:

I do not know.

MR. MURPHY:

How would we be able

MR. KING:

I did not say no, I said I

cannot speak for Marble Mountain on the process they followed.

MR. MURPHY:

Okay.

That would be outside your purview?

MR. KING:

It is outside my knowledge

base today. I could check it out,

but I cannot speak and say, yes, they did tender or no they did not because I do

not know.

MR. MURPHY:

Okay, so we can get an

answer about that?

MR. KING:

Sorry, Carmela knows

MS MURPHY:

The contract went to a

company called Leitner-Poma. There

are only two companies in the world that actually do chairlifts.

The old equipment that was at Marble was done by Poma, so they worked

with GPA and went with Poma again.

MR. MURPHY:

They just went with the same

company, so without tendering?

MS MURPHY:

Yes, it did not have to be tendered.

MR. MURPHY:

Okay, but what I am saying

is that some of the old equipment it was realized, I think, midway through the

construction of the new lift that there was going to be more anticipated that

was needed for the lift at the same time.

The initial call for a lift, for example, did not go out to public

tender.

MS MURPHY:

No, it did not.

MR. MURPHY:

Even that $3.3 million?

MR. KING:

No.

They worked with the Government Purchasing Agency on the process.

MR. MURPHY:

Okay.

Those are the only questions I have on that.

I am finished at 7.1.04.

MR. KING:

There was no cost overrun

either, by the way.

MR. MURPHY:

There wasn't a cost overrun?

MR. KING:

No.

There were delays in the timing, but no cost overrun.

MR. MURPHY:

Okay.

CHAIR:

Does Mr. Flynn have any

follow-up questions on

section seven?

MR. FLYNN:

Subhead 7.1.02; I asked the

one on the Salaries so there is no real answer there yet.

MR. KING:

Excuse me, no real answer to

what?

MR. FLYNN:

No, I said I never got a

firm answer, I meant to say, on the tourism officer for Labrador.

It has been vacant for a number of years.

MR. KING:

On that particular position?

MR. FLYNN:

Yes.

MR. KING:

Sure.

Okay.

MR. FLYNN:

Grants and Subsidies; I

think that $12 million is basically for the St. John's Convention Centre.

MR. KING:

Yes.

MR. FLYNN:

All of that $12 million or

is it $7.5 million?

MR. KING:

You are asking what is

within the $12.5 million, right?

MR. FLYNN:

Yes.

MR. KING:

Yes.

The Convention Centre is there at $12.2 million, there is the East Coast

Trail funding, and there is money as well for Visitor Information Centres.

MR. FLYNN:

Can we get kind of a

breakdown of that, where that money is being spent?

MR. KING:

Sure.

The Convention Centre, $12.2 million; the East Coast Trail, $100,000; the

Visitor Information Centre is $146,000; and $40,000 for market readiness.

MR. FLYNN:

Okay.

If there are overruns on the Visitor Centres and we have all heard that

there are will the government be supporting these overruns, or this is the

total commitment to this project?

MR. KING:

This is the total commitment

to the project, but we certainly would handle situations on an individual basis.

If there are overruns from a particular area, then we would consider them

as they happen.

MR. FLYNN:

Yes.

I would like to just mention to the minister and I know he already

knows I operate a business there at Marble Mountain, so if you perceive there is

a conflict of interest, just say it and I will defer the next question to my

counterpart over there. In the

Grants and Subsidies to Marble, is that primarily an operating grant or is it

some of the ads that the Province supports and runs on Marble Mountain in the

winter. That is 7.1.03, item 10,

$840,000.

MR. KING:

The breakdown is $390,000

for operating and $450,000 for capital improvements.

MR. FLYNN:

Okay.

I do not know if this would fall under transportation, but I know we have

had some areas of concern with respect to the last time the outfitters were

inspected. I think presently we are

just issuing a licence to outfitters without inspections?

MR. KING:

The last time what was

inspected?

MR. FLYNN:

I said I am not sure when

the outfitters were inspected the last time.

We just basically are issuing licences for the outfitters without

inspection.

MS MURPHY:

Yes, well all accommodations

are no longer inspected per se.

Canada Select is done through regular fixed growth.

As you

know, Canada Select does not do outfitting.

We rely on some of our other partners who go in and out of the camps from

other enforcement divisions, and the federal government through Transport

Canada, to look at outfitting camps.

MR. FLYNN:

So they are issued a licence

without the inspection as required under the law?

MR. KING:

Yes.

MR. FLYNN:

That is about it for me.

If there is something that comes up I can assume I can go back to it, but

that is it for that one for me.

CHAIR:

I call 7.1.01 to 7.1.04

inclusive

All

those in favour, 'aye.'

SOME HON. MEMBERS:

Aye.

CHAIR:

All those against, 'nay.'

Carried.

motion, subheads 7.1.01 through 7.1.04 carried.

CHAIR:

Section 8.1.01 to 8.1.09,

except for

section I think 8.1.04 has already been approved.

Mr.

Murphy, do you want to start?

MR. MURPHY:

(Inaudible).

MR. KING:

It is 8.1.03.10.

You are asking about the increase of $17,000.

MR. MURPHY:

Yes.

MR. KING:

That is for salary and

pension changes.

MR. MURPHY:

Can we get a breakdown of

the Grants and Subsidies as well for this line?

MR. KING:

We do not administer that.

The Arts Council administers it.

We would have to go to the Arts Council and ask for that.

MR. MURPHY:

Okay.

MR. KING:

We can do that.

MR. MURPHY:

Under

section 8.1.05, the

Newfoundland and Labrador Film Development Corporation shows an added $33,800.

I take it we would have to go to the Newfoundland and Labrador Film

Development Corporation to get a breakdown of the Grants and Subsidies in this

line, or would you have it?

MR. KING:

No, we would not have it.

MR. MURPHY:

Okay.

MR. KING:

Both of those are just

grants from government. They, in

turn, have a board of directors who do their budgeting.

MR. MURPHY:

Okay.

MR. KING:

The increase there is

salary, though.

MR. MURPHY:

It is salary related?

MR. KING:

Yes, the increase.

I thought you meant a breakdown for the whole budget.

The increase there is for salary.

MR. MURPHY:

Okay.

Under

section 8.1.08, the Heritage Foundation of Newfoundland and Labrador, I take it

these are salary increases as well on this line, Minister?

MR. KING:

Yes.

MR. MURPHY:

Okay.

On to

the Newfoundland and Labrador Film Development Corporation, 8.1.09, the

appropriation last year was $4.5 million.

This year that has increased to $4.955 million.

I wonder if you can give us a breakdown on what is happening here in line

08. This is the new film and the

old commitment to Doyle, I take it.

MR. KING:

No.

The extra $500,000 is the one I

referenced earlier this morning on

Frontier mini-series.

MR. MURPHY:

Is that being filmed here in

the Province as well?

MR. KING:

Yes.

MR. MURPHY:

Okay.

I heard a little bit about it, but not too much really that is out there.

So the

commitment this year if $4.9 million from government to that?

MR. KING:

No.

The commitment is $500,000.

The other $4.5 million is the annual budget that government advances to the Film

Development Corporation.

MR. MURPHY:

Okay.

Under

8.1.06, Historic Sites Development, Purchased Services was down by $20,900 this

year but it is up to $480,000 this year.

I wonder if you can give us a breakdown on this overall line, what is

happening.

MR. KING:

The decrease was just that

we did not spend the whole budget.

The need was not there at the time.

The increase in the budget this year is for some planned repairs to the

provincial historic sites.

MR. MURPHY:

Do you know which sites they

are right offhand?

MR. KING:

Yes.

It would be Trinity, Mockbeggar Planation, Bonavista Lighthouse, Heart's

Content, Beothuk

Interpretation Centre, Point Amour, Newman Wine Vaults,

Commissariat House, and Cupids.

Sorry, not Cupids, my mistake.

MR. MURPHY:

Okay.

I think I saw a release on that the other day.

That might have been part of it.

Subhead

8.1.07, Special Celebrations and Events, the salary allocation is only up by

$4,100. I take it this is a normal

step increase of 3 per cent.

MR. KING:

Correct.

MR. MURPHY:

Okay.

Transportation and Communications is down considerably, $60,000 was budgeted and

there was only $1,500 spent. There

is only $33,000 appropriated for this year.

I wonder if I can get a breakdown here.

MR. KING:

That represents a couple of

things: one, obviously less than anticipated travel.

We had planned to do some travel around the First World War

commemorations, the Gallipoli memorial, which is now delayed to 2015-2016, and a

freeze on discretionary travel.

MR. MURPHY:

Okay.

Professional Services, same section, down by $189,000 from last year but, again,

it was budgeted for $320,000. There

was only $15,700 spent.

MR. KING:

The initial allocation there

was around the First World War commemorations.

The initial plan was for a caribou and that plan has now changed.

So the money was not spent, obviously.

The

allocation we have this year is going to be on the same project, but instead of

the initial project with the caribou, there will be a plaque and some other

things.

MR. MURPHY:

Okay.

So they were going to put the model up of the caribou over at the

Gallipoli site were they?

MR. KING:

Yes.

MR. MURPHY:

What was the decision they

made to change that and just put a plaque up instead?

Why did they make that change?

MR. KING:

Why?

MR. MURPHY:

Yes.

MR. KING:

Cost saving primarily.

MR. MURPHY:

I do not know.

It seems like it would have been more wise to put a this is my

Newfoundland and Labrador patriotism speaking now, but I think the caribou

memorial in Bowering Park and Beaumont-Hamel probably would have had a nice

connection with Gallipoli too, knowing that we served there.

I think something was missing there.

I do not know why they made that decision, but,