Resource Committee — Department of Development — 15 May 1991

1991-05-15

Newfoundland and Labrador — Committees

May 15, 1991

Department of Development

(Unedited)

The Committee met at 9:30 a. m. in the House of

Assembly.

MR. CHAIRMAN: (Walsh)

Order, please!

I would like to welcome participants to the

continuation of our first Resource Estimates Committee which dealt with the

Department of Development and we will pick up virtually where we left off in the

last session.

A quick view of participants, I see, Mr. Minister that

there are some new faces this morning whom you may wish to introduce. I would

like to make one other point very clear to all Departmental officials, all

questions being asked this morning are to the Minister and through the Minister;

any official may answer a question but only at the direction of the Minister, so

all questions will be to him.

If you would like to do an introduction of your

officials, Mr. Minister, we will get started.

MR. FUREY: Thank you, Mr. Chairman.

We are delighted to be back here to talk to you about

our estimates. On my right is the Deputy Minister of Development, Clyde Granter;

on my immediate left is Mr. Jim Janes, who is the President and Chief Executive

Officer for Enterprise Newfoundland and Labrador; and on my far right is Adele

Poynter, who is one of our commissioners at the Economic Recovery Commission.

Behind me, to my far left is Sam Kean, who is with the

Recovery Commission and Dorothy French and Patrick Kennedy who are with

Enterprise Newfoundland and on my far right is David Butler, who is the Director

of Financial Administration with the Department of Development; Sid Blundon, who

is the Assistant Deputy Minister of Tourism, and directly behind me is Barbara

Wakeham, who is the Assistant Deputy Minister of Investment and Trade.

Is that it? Tourism and Promotions for Mr. Blundon and

Investment and Trade for Miss Wakeman. Is that right?

AN HON. MEMBER: Industry, Trade and Technology.

MR. FUREY: Industry, Trade and Technology. We will

get it right one of these days. If at any point during the proceedings officials

have to leave, it is because they have other meetings and things like that, so

they may all abandon me within the next hour.

MR. CHAIRMAN: Thank you, Mr. Minister.

I would like to introduce the Committee: Mr. Walter

Noel, the Member for Pleasantville; Mr. Alec Snow, the Member for Menihek; Mr.

Hewlett, the Member for Green Bay.

Guest participants this morning are: Mr. Percy

Barrett, the Member for Bellevue and Mr. Larry Short, the Member for St.

George's. The Vice-Chairman of the Committee of course is, Mr. Woodford, the

Member for Humber Valley.

Mr. Woodford, if you would like to begin?

MR. WOODFORD: I see Sam Kean here this morning and

I wonder if Sam still has anything to do with the co-ops? Under this new bill,

Mr. Minister, an amendment to the Co-op Societies Act presented by the

Department of Finance, this used to be the responsibility of the Department of

Development. What was the real reason for putting this with Finance as regards

changes in this new bill?

MR. FUREY: If you do not mind, I am going to ask

Sam to answer that because he has been dealing with the Department of Finance,

Development and Justice on that very matter; it is more of a technical question

so I will ask you to address that because you dealt with it.

MR. KEAN: Well a simple answer, Mr. Chairman, is

the fact that, due to the restructuring of the co-operative division, I think

that happened about eight months ago, it was decided that it would be more

appropriate to put the responsibility for credit unions under the Department of

Finance for the purposes of regulation, so now, what we have is, the credit

unions with the Department of Finance and the Co-operatives with the Department

of Development.

MR. CHAIRMAN: I am being informed by Hansard, and

I apologize for this, but although the Minister introduced Sam that time, I

would ask each participant to identify himself before giving an answer, for the

sake of Hansard, as it will be typed in weeks to come.

Mr. Woodford?

MR. WOODFORD: So what you are saying is that the

credit unions will come under Finance, and co-operatives in general, like co-op

stores, would come under Development.

MR. KEAN: That is correct.

MR. WOODFORD: With the same regulations?

MR. KEAN: No. At the present time, Mr. Chairman,

there is a single piece of legislation governing both co-operatives and credit

unions in the Province and it will remain until Government brings forward

separate legislation for credit unions under the Department of Finance and

separate legislation for co-operatives under the Department of Development.

MR. WOODFORD: With references in that Bill,

references from the Stabilization Fund Board to the Credit Union Deposit

Guarantee Corporation, would that make any difference with regards to the

amounts? Stabilization fund, would that be - what? a maximum of $60,000 or

something like that?

MR. KEAN: Well, at the present time, Mr. Chairman,

the stabilization fund is a single fund which is contributed to by the credit

unions in the Province and it has approximately $1.4 million in it. The actual

security against members' deposits is up to the limit of that fund. But the

proposed legislation is going to provide additional protection to credit union

deposits across the Province, to the limits equivalent to what is currently

provided under the Canada Deposit Insurance Corporation. So in essence what we

are going to have is a Provincial Deposit Insurance Guarantee Fund similar to

what is being provided to the banking system throughout the country through the

Canada Deposit Insurance Corporation.

MR. WOODFORD: Up to?

MR. KEAN: Up to $60,000 per deposit.

MR. WOODFORD: Same as a bank.

MR. KEAN: So there are different deposit ranges

within that whole programme. Essentially you can have - depending on how you

deposit it with the credit union system - up to $210,000 worth of protection.

Because it is per deposit. So you can have it in different deposits and I think

the limit is about $210,000. So it is a much greater protection for the deposits

which people can invest in the credit union system.

MR. WOODFORD: I cannot remember, although

something comes to mind concerning it - remember the pilot project that was

talked about? In fact, I was talking about it when I was there for a short time,

concerning the commercial institutions. Was that put in after? With regards to

lending to commercial institutions through the credit unions? That was not

instituted, was it?

MR. KEAN: No. At the present time the credit

unions in the Province, with some rare exceptions, do not become involved in

commercial lending. What is being proposed through the Enterprise Corporation is

a pilot programme called a Community Enterprise Plan which hopefully will assist

the credit union system to participate in extending commercial services across

the Province, particularly in the rural areas of the Province. What we have to

wait for are certain amendments to the credit union legislation, or through the

legislation itself, to provide for commercial lending. That is what we are

waiting for at the present time. As soon as that happens we will be going

forward with that particular programme.

MR. FUREY: (Inaudible) Province into commercial

lending if we can. But as Mr. Kean rightly points out this is very much a pilot

project and it is premised upon that legislation going through. I think they

will choose one or two areas around the Province and start commercial lending in

those particular areas, assess it after a period of time, and then move into

other areas. But it is the long term goal to move credit unions, which are

predominantly in rural areas, into small-scale commercial lending.

MR. CHAIRMAN: Before a follow-up question I just

want to - and I will certainly allow Mr. Woodford to carry on and finish the

point being made - but as this legislation will probably be before this very

same Committee in the legislative side of this Committee, if you want to pursue

your train of thought at this point in time I have no problem. But I am not

overly anxious to get too deeply into the Bill knowing full well it is probably

a matter of weeks and we will be dealing with this Bill in Committee.

MR. FUREY: Mr. Chairman, has this cleared the

Legislative Review Committee, or...?

MR. WOODFORD: No. But apart from that, in answer

to you, Mr. Chairman, I have the right here as a Member to question anything

pertaining to Development or anything else pertaining to the Department that the

Minister is responsible for. So I am not taking exception to it but I just want

to make it quite clear to you that I have a right to question the Minister and

his officials on anything pertaining to anything in his Department, even if I

have to refer to a bill that is on the order paper now.

MR. CHAIRMAN: That is why I am saying - I have no

problem with the questioning, but I just want to say I do not want to get into a

full-blown discussion on the Bill itself. The aspect of the co-ops I can relate

to the estimates but I prefer the Bill as such be discussed in the other

Committee. As it is only a proposed bill at this point in time we may be

discussing something that may never become reality.

MR. WOODFORD: Mr. Minister, I think it was a

couple of years ago now when this particular subject came up. I believe you made

a statement in the House pertaining to this lending to commercial institutions,

by the way. The very point that you just brought out, picking out two or three

areas in the Province - especially rural areas of the Province - where this

could be instituted. Now I understand from the comments made by Mr. Kean that

that is probably going to go through, something to do with Enterprise

Newfoundland, or...?

MR. FUREY: Well, that is where the co-operatives

and that kind of thing sits, under that community - what is it called, Sam?

MR. KEAN: Community Enterprise Plan.

MR. FUREY: The Community Enterprise Plan which is

a special program. You are quite right, I did talk about it, not a couple of

years ago, about eight to ten months ago, maybe a year ago, even. I think it was

with respect to the introduction on first reading of that Bill that I had chosen

to table in the House and subsequently withdrew it or it died on the Order

Paper. I know the Department of Finance had a number of concerns, and I do not

want to get into the details of it, but they wanted to do a thorough review

prior to allowing or giving permission to any credit union anywhere in the

Province to get into commercial lending. They did that review and I understand,

Sam, it is pretty well done is it not?

MR. KEAN: Yes, it is.

MR. FUREY: Finance is reported and you have had

your meetings from the Enterprise side with Finance and we are ready to move

when that Bill goes through.

MR. KEAN: That is right.

MR. WOODFORD: So, there is a possibility over the

next year or so that there may be a pilot program instituted?

MR. FUREY: Mr. Woodford, if that Bill receives

royal assent in this session this Fall, we will have a number of those credit

unions participating in commercial lending on a pilot project basis.

MR. WOODFORD: Because at that time it was

mentioned -

MR. FUREY: I trust you will help us pilot that

through.

MR. WOODFORD: Well, I was going to suggest, and I

believe I suggested at that time, that probably the Deer Lake credit union,

where it has been just brought in last year, or the year before, has been very

successful and growing really fast, and would probably be a good place to

institute such a program because of that good cross

section of forestry,

agriculture, tourism, and fishery. You have it all.

MR. FUREY: You just want all those people in St.

Barbe now to make deposits in Deer Lake. Is that what you want?

MR. WOODFORD: That is a great help.

MR. FUREY: And then come and borrow.

MR. WOODFORD: Come and borrow, yes, and spend

while they are there.

Pertaining to the Government stores, the Labrador

stores. Has there been any interest in people making proposals to your

Department to take over those stores?

MR. FUREY: We have not actually formally gone out

and asked for proposals. I will just give you very briefly the history. You know

we operate five stores along the northern coast of Labrador. These stores,

historically, have lost considerable sums of money. I believe in the last fiscal

year we lost $550,000.

MR. WOODFORD: $550,000?

MR. FUREY: A little over half a million dollars.

What we were trying to do is examine how we could best deliver efficiently and

effectively quality service to those people in the isolated parts of Labrador,

but at the same time do it by being fiscally responsible, and one of the

problems we have is that governments are poor storekeepers. We are not good at

running stores if we have to bind ourselves to the Public Tendering Act and all

those kind of things, because you know that process takes a long time. I do not

know if when you were Minister you were responsible for those stores. For

example if there is a sale on with cases of beans, or whatever, we have to go

through the public tendering system and by the time we go through that system

people who we were competing with who also run stores are cleaning out these

sales and stuff so we are left behind paying full price for these products and

the cost to get them into these isolated regions. There are a whole plethora of

problems that come up with these stores so what we did is commission a study,

completed by Deloitte & Touche and they basically presented this to us about

three weeks ago. There are some very valuable suggestions in there but I have

not had time to prepare an executive

summary and Cabinet Paper and brief my

colleagues on that. I would prefer to do that prior to making a release of it,

but there are a number of things that we announced in the House that arose

partially from this study and partially from internal reviews by our people at

Development. We have implemented a number of things such as coupon redemptions

and things of that nature to help people in the local area, but there are a

number of options and the options are the status quo, leave the stores as they

are and let them continue to run up significant debts and be a burden to the

taxpayer. Another option is to look at the co-operative option, to allow

participation by local people. Another option is direct privatization. Another

option is partial privatization. Well, there are a number of options that are

listed in this particular study but we have not gone out for any public

proposals or calls. We certainly, by way of conducting this study, have sent the

signal to the business community that we are prepared to look at options.

Unsolicited calls have been made to my office by a number of businesses asking

what the status of it is but Government has not taken any formal position to

divest of those stores in any way. The purpose of the study was to make the

bottom line more realistic, to deliver efficiently in isolated areas, and to

deliver quality to these people. Now, if that means total privatization at the

end of the day, so be it. If it means co-operative with participation from the

local communities, well so be it. But this study was done and done very

thoroughly at minimum expense to the Government but there was a very good

consultative process too. I believe they visited Nain twice, this company, and

had public meetings, Hopedale, Makkovik, Davis Inlet and Postville.

So it was comprehensive, there was good consultation,

there was lots of community involvement. But at the end of the day we want to

erase that half a million dollar debt that keeps cropping up yearly, and I think

the way to do that is to structurally correct it. Not because we want to avoid

the public tendering system and stuff, but if we are going to be shopkeepers and

continue to be shopkeepers there have to be structural corrections to allow us

to perform as shopkeepers out there in the retail trade sector.

MR. WOODFORD: When it is all looked at it is a

possibility. Two options, either going the co-op way or possibly privatizing all

the stores.

MR. FUREY: The options are as I have outlined

them. Status quo, continue to absorb these losses into the general deficit; to

correct it by way of co-operative participation by local groups; privatization

by local groups taking it over. But we cannot abandon people, we cannot abandon

that service because of the isolated nature. Although, private sector people

have given us considerable pressure from some towns along the coast to abandon

it and to allow the private sector. Some people who own stores in these regions

say that we are unfairly competing with them. So it is a delicate balance and we

are trying to find what the proper solution is. I think we will come to a good

solution at the end of the day. I just do not know what the final answer is yet.

MR. WOODFORD: If any other Members have any

questions I will yield.

MR. CHAIRMAN: Mr. Short.

MR. SHORT: I do not know if this question was

asked at the last session but, Mr. Minister, where is the Federal-Provincial

tourism agreement? What stage is it in?

MR. FUREY: It was asked at the last session, and I

will just, if Members will indulge me, review it quickly. The tourism agreement

we are hoping will be signed shortly. I do not want to, and I do not think it

would be proper for me, I know when it will be signed, but I do not think it

would be proper without the Federal Government's agreement - after all they are

an equal partner in this agreement - or without consulting them to say when it

will be signed. But I am very hopeful that it will be signed shortly. I think it

is a good agreement. I think our Tourism people from the Provincial side have

done a fabulous job putting a strong framework in place, and it will mostly be

for public parks and these kinds of things, public infrastructure, much more

that private infrastructure as it was in previous agreements. I do not know if

Mr. Blundon wants to add to that.

You do not want me to tell them all this, do you?

AN HON. MEMBER: (Inaudible).

MR. FUREY: Okay, we have nothing else to add.

MR. CHAIRMAN: Mr. Hewlett.

MR. HEWLETT: I would make a brief comment and I

will ask the Minister's reaction with regard to the Economic Recovery

Commission. We have now the Enterprise Corporation, which is a concept that was

on the go in its initial phases certainly when the previous administration was

in power, the - if I might use the word - amalgamation of government's

programmes and agencies of funding into one more streamlined entity. So

therefore the concept of Enterprise Newfoundland is not something I would object

to. Indeed, the concept I think is one, one could support.

But I have always thought it curious, Mr. Minister,

that the previous administration and Dr. House study a societal problem that we

have and that is our chronic unemployment, which has been with us for many

years. But why would this current administration - Dr. House being a sociologist

- I can understand a sociologist studying a societal problem but why put a

sociologist in charge of the solution? I would have thought that a recovery

team, being the board of directors for its banking instrument, Enterprise

Newfoundland, would probably be best led by someone of a - and I hope the

gentleman will forgive me for using his name - a Lee Iacocca type. A dynamic

private sector entrepreneurial type individual rather than a more academic

sociologist sort.

Could the Minister enlighten us as to why we have a

sociologist? I can understand why a sociologist would study the problem. But why

appoint one to deliver on fixing the problem?

MR. FUREY: First of all, Mr. Hewlett, Mr. Iacocca

was busy and we could not entice him to come to Newfoundland. Seriously, I

suppose, if you go to a doctor and you ask the doctor to diagnose your ankle

after a heavy game of tennis and he determines that it is broken you would want

that doctor to fix it. So, the previous Government did a study called Building

on our Strengths, they chose Dr. House because of his competence and his

knowledge and background and asked him to do that study. They laid out that

study with recommendations and we as a government said: well you know if Dr.

House was good enough for Premier Peckford and the previous Government to lay

out the study and offer up solutions perhaps he is the proper one to now put in

place to implement those solutions.

It is not isolated to Dr. House. Ms. Poynter is here

this morning and she brings a certain level of competence. She was a senior

person with ACOA previously, has a masters degree in economics and business

management. Mr. Humphries ran a private sector business very successfully. Ms.

Sherk, out of Nova Scotia, brings a sterling reputation from the private sector

with Mobile and others. These people are quite competent. Their task is a

monumental one, it is not easy. There are no easy solutions and we have said

from day one there is no magic wand. Nobody at the Commission has a magic wand,

they cannot wave a magic wand and take us to zero unemployment. All they can do

is advise in a very general way Government on policy directions that we can move

toward.

I think they have done a very good job in many

regards, despite the criticisms that I find for the most part to be unfair and

unwarranted. You are quite right that the previous Government through its

various studies, SERC and others, determined that decentralization was the

proper way to go and that Enterprise Newfoundland should have been set up, so I

thank you for commending us for taking up the challenge that you left us with to

proceed with Enterprise Newfoundland and Labrador. It is quite heartening to

hear somebody in Opposition give us credit where we believe credit is due. But

equally as Minister let me give you credit for setting out the groundwork and

the framework to do this. We just happened to have been the Government elected

which moved forward to proceed with it, so we are both due equal credit in that

regard.

Ms. Poynter did you want to add something to that?

MS. POYNTER: I think I would add to that the

Enterprise Corporation was never meant to be a bank, in fact. Obviously, it

offers financial services and it has a very competent staff which advises the

board about those services, but it is also meant to handle non-financial areas,

for example, it offers non-financial support in the area of marketing, business

planning preparation and all the other sort of hand holding that many of our

enterprises need. It also handles rural development associations, co-operatives

as we just mentioned, and is looking in fact at innovative solutions to fund

many of those mechanisms. It also has a regional planning function. Of course,

it is not also just an amalgamation of government programmes, it is also

decentralized with authority in the regions and a lot of those with

non-financial functions are a very important part of the Corporation, so it not

meant to be just a bank.

MR. HEWLETT: I would just make a comment on the

Minister's metaphor with regard to the broken ankle. Perhaps, the doctor who

diagnoses it may well strap it up or put it in a cast for a while, but to regain

full use of the limb one would hope that somewhere along the line the good

doctor would step aside and let the physiotherapist bring about a more

productive use of the limb. It was in that context that I thought your Mr.

Iacocca or some reasonable facsimile thereof might be the physiotherapist.

One hears in the press, Mr. Minister, and one has

heard over the past year or two from Dr. House, at times what a watcher or

reader would, I guess, interpret as a degree of frustration with the reality of

Newfoundland and at times Newfoundlanders. I saw a story in the most recent

weekend paper indicating he was thinking about going back to the university full

time. One of my colleagues mentioned that there was something on the radio this

morning, which I did not hear, that sort of negated that. What is the current

status? -- because the one thing that Mr. Iacocca brought to the Chrysler

Corporation, when it was literally flat on its back, was a degree of dynamism

and self confidence, and when the chairman of the board of one's banking

instrument, one's planning instrument, one's hand holding instrument is

expressing doubts out loud as to the ability of the Newfoundland populace to

perform the commitment of himself to stay, surely, Mr. Minister, that sort of

casts a pall over the objective of Enterprise Newfoundland and the Economic

Recovery team - the objective, of course, which is very laudable.

MR. FUREY: I guess what you are asking me amongst

all that language is what are Dr. House's future plans? He came to the

commission with a commitment of two years. He has served the Province faithfully

and diligently. He has worked long hours, much of it away from his family. He

has punched a lot of time on the road. He has met with literally thousands of

people. I would say he has been just about everywhere in this Province, all over

the Province. In fact I am going to table the details of his travel today in the

House, as was asked on the Order Paper. He has given a firm commitment to carry

on for the next twelve months, beyond that I do not know, but I tell you that

the Province has been served very well by Dr. House. You talk about instilling

confidence; I think he has done a pretty remarkable job, particularly in rural

Newfoundland, of instilling confidence in people. Lee Iacocca he may not be, but

then Lee Iacocca accepted $1 billion in U.S. dollars to bail out Chrysler - we

do not have that billion dollars. Mr. Iacocca makes $20 million a year, well we

cannot pay Dr. House $20 million a year. But for what he is being paid, he is

deserving of every cent.

MR. HEWLETT: One more question, Mr. Chairman.

Again I will get back to the concept of amalgamation. The Minister or his

officials are probably familiar with the term that is used in economic circles:

synergy, which was a new one to me up until a few years ago, until I had an

economist explain it to me that the sum of the parts is greater than if you take

them individually and add them together, that the interacting of parts creates

some sort of "magic" interactive force that is positive, dynamic and self

sustaining. And you, Sir, are the Minister responsible for economic development

in our Province, and yesterday we saw an instance in the municipal sphere where

a large municipal body near the capital city was allowed to live but not to

grow. I wonder is that not a sort of negative synergy being done within the

confines of your mandate, and that it would tend to stifle or choke a degree of

economic dynamism within this general region by virtue of a municipal policy

that I would think take the energy, the life blood out of twenty-odd thousand

people in this immediate area? Would that not cause you a degree of concern

being the Minister responsible for economic development in a positive

development climate?

MR. CHAIRMAN: Before you answer the question, Mr.

Minister, (inaudible).

MR. FUREY: (Inaudible).

MR. CHAIRMAN: Well I will not exactly say we have

strayed. The train is on the same tracks, it just does not seem to be travelling

in the same direction. I am not quite sure where the question is coming from or

leading to. I will say to you that I have absolutely no intention of trying to

justify or deal with Municipal Affairs matters in a Resource Estimates Committee

on the Department of Development. Every business that existed in that community

yesterday opened up again this morning. I am not sure if the Minister even wants

to deal with the question, because I am not sure what the question was, I -

MR. HEWLETT: My point Mr. Chairman, if I may, is

quite simply, that yes, I totally agree that a strict discussion of municipal

matters would be certainly outside the ambit of this particular committee; but,

a community, be it a city, town - for instance, I think this morning every shop

opened up in Paradise and the surrounding area and I do believe that as of

yesterday, and I feel good for the Town of Paradise and its environs, that there

is a positive synergy existent in the Town of Paradise today that was not there

yesterday morning, which is good for economic development in that particular

area. In the same context, I would contend to the Minister, that, even though

the same businesses are opened in the City of Mount Pearl, the community of

Mount Pearl, call it what you wish - that the life-force, the dynamism that is

needed to grow and expand and develop, is somewhat diminished, and it was in

that context that I put the point to the Minister.

MR. CHAIRMAN: I appreciate the question but I

cannot find a parallel between the two; I distinctly remember some years ago

myself opening a Kentucky Fried Chicken Store in that very city; my

understanding is that my successors are planning on opening a second one,

regardless of what happens.

I do not understand the logic and unless you can

define the question a little bit better, as I said, I am not going to let the

committee slip into a Municipal Affairs issue. Certainly that question might be

a good one for the Minister during Question Period this afternoon, but the

Minister of Municipal Affairs, and I prefer you not deal with it, Mr. Minister,

unless you want to - I will give you thirty seconds, but I have no idea where we

are going with it and I just want to go on record that I have no intentions of

dealing with municipal affairs issues here today, so -

MR. HEWLETT: Well (inaudible) issue, if the

Minister wishes to comment, fine, if not, I have made my point. Thank you.

MR. FUREY: The question is somewhat

contra-synergistic, but that not-withstanding, what you are saying is: has

amalgamation, in any way dampened the economy overnight? - and it will in the

long term future, and how does that affect my department and the Economic

Recovery Commission's mandate to provide focus and policy direction to business

development in the Province?

I do not see any negatives at this point in time, it

is early to say, they may well be up the road, I have no crystal ball, but our

Department, through Enterprise Newfoundland, will continue helping small and

medium size business right straight across the Province. My larger Department,

under which everything comes, the Department of Development through the Deputy

and the two Assistant Deputies who are here today, will continue along the path

of Trade Investment Promotion, Tourism and all those good things that we are

doing in the larger department and the larger projects in inducing and

attracting large projects to the Province.

The Recovery Commission, this morning, continues with

its mandate to provide focus and direction and new pathways for the Government

to look into, so, has amalgamation caused any great wet blanket to fall across

the economy of the Province? -- No. Will it in the future? -- well, it is hard

to tell, I do not see it could or would, but I have no crystal ball, Mr.

Chairman.

MR. HEWLETT: There is no point, Mr. Chairman and I

yield to someone else.

The Minister though, I would think, as a part of his

mandate would agree that the development of an entrepreneurial climate in our

society would be a part of his mandate, and any other Government policy which

would have a tendency to detract from that climate, would tend to make the

Minister's job more difficult; is that a fair statement?

MR. FUREY: Well, I can give you a thousand things

that make my job more difficult; it is a monumental task, it has never been easy

in our history to develop this Province. You know, because you have written many

Throne Speeches about our geography and the negatives with which we are dealing

constantly, some of it very poetic, and I can understand where the hon. Member

gets his poetry, it has shown up many times in Throne Speeches that I have

witnessed.

But seriously, it is very difficult to develop this

Province; there are thousands of things that conspire to come against us at any

given time, at any given point in our history. For example, just as Hibernia

starts to take off, who would have predicted the crisis in the fishery, so, as

we are getting a positive on the left side, we are taking a negative on the

right side, so you know all of these things fit into the mix.

It is a very difficult task that we have before us. We

have no easy answers, magic solutions or special wands. That is why we asked for

the expertise and competence that the four commissioners with Dr. House bring to

bear upon our policy direction. We do not have the answers. So we are drawing

from the business and academic worlds, and the other systems that we drew from,

to ask them to help us with direction. I think the onus is not just on me, Chuck

Furey, as Minister of Development, or one Member of this House. The onus is on

all fifty-two Members. All of us are in a way Ministers of Development, it is

all our responsibility to develop the Province.

AN HON. MEMBER: (Inaudible).

MR. A. SNOW: Thank you. Mr. Minister, in our last

meeting I believe - I am not sure if it was you who mentioned it or your person

responsible for tourism, talked about the number of tourists coming to the

Province - I believe it was 298,000. One hundred and thirty thousand of those

are in Province tourists, the remainder coming from outside the Province?

MR. SID BLUNDON: Actually, Mr. Snow, the

non-resident numbers were 290,000 visitors to Newfoundland and Labrador. Fifty

per cent of those came in by ferry, basically 50 per cent came in by aircraft,

and a smaller number came in through the road in Labrador West. We do not really

have a great breakdown of how much of that is actually business travel, how much

is strictly tourism travel. We are in the process of conducting a domestic

travel survey and finalizing some reviews of our auto and air exit surveys that

were done last year. As a result of that we should have a better handle of how

much of that was strictly tourism.

In terms of the resident travel - what we consider

resident travel is anybody who basically travels eighty kilometres outside of

their jurisdiction and spends an overnight. There was 1,269,000 of those. That

is basically residents travelling throughout Newfoundland. As a result of the

domestic travel survey which we are in the process of completing and evaluating

we will find out what travel plans are and again how much of that was strictly

tourism and how much was related to business traffic. The 130 that we talked

about, that is the $130,000,000 dollars that was associated with the 300,000

non-resident travellers.

MR. A. SNOW: Thank you. The reason why I wanted

that information was that I would wonder if indeed there will be any surveys

conducted in western Labrador with regard to numbers of people coming in and

leaving the area this year. That is one part of it. I would also like to know

what kind of an affect do you feel this resident population not working this

year will have on the tourism industry, if you will. The fact that this

Government is going to be probably laying off 2,000 people, or 2,500 people. We

are in the process of that. I think that is the figure, isn't it? Around 1,500,

2,000 total?

Anyway, what affect that will have on the in Province

or resident tourists if you want to call them that. I would think that the fact

that they will not have as much disposable income - albeit they may be on

unemployment insurance, they may not be leaving the high paying jobs in the

public sector - they are still losing disposable income and they probably will

not want to travel as much as they did in previous years. I would like to know

the affect of that. I would also like to know what role your Department plays in

the development of transportation in the Province in the sense that in western

Labrador we are putting a lot of faith, and have put a lot of faith into the

construction of the Trans-Labrador Highway. I would like to know what your

Department's role has been, and will be in the future, in the development of the

highway? As you are well aware it is something that a lot of residents of

western and central Labrador are promoting. We see it as a vehicle of

development and not as presenting obstacles where people are going to have to

clear snow from it or maintain it. We see it as a vehicle of opportunity. We see

it as something similar, I suppose, to the field of dreams, build it and the

people will come. I would like to again know what your Department's role has

been. We feel in western Labrador that since the decline of the mining industry

in the early 80s we as a community promoted tourism very much. As a matter of

fact the councils promoted it prior to - when I say councils I mean town

councils, promoted it prior to any infusion of money from the Province. I would

like to know when you people will be putting more promotion into promoting that

part of Labrador in tourism brochures? I would also like to know what role your

Department plays in the establishment of regulations with regard to hunting and

fishing for tourists who are attracted to Labrador? My understanding is that

most of the tourists who come to Labrador are interested in hunting and fishing,

or adventure travel. I would like to know what role your Department plays in the

establishment, enforcement, and the rationale behind those regulations that were

established last year?

MR. FUREY: You have asked quite a number of

questions so I will get my assistant deputy to deal in some of the specifics you

have asked. Any layoff, one person laid off affects the economy. You asked about

the number of Government employees that would be laid off. I do not think the

final numbers have been determined or calculated yet, how many are going to be

through attrition, how many will be through not filling vacancies, how many will

be what I call real people who are laid off from real jobs they have been

occupying. Your number was 2500 or 3000 but I do not think it will reach that. I

have no way of knowing yet because we do not have the final calculations in from

the hospitals, the schools, and all those kind of things. When we get that and

add it up we will have a more concrete number, unless it has been announced in

my absence. I have been away for a week at the Science Minister's Conference in

Saskatoon and at the Offshore Technology Conference in Houston and meeting with

business groups in Toronto and Halifax. Unless it has been announced in my

absence, Mr. Chairman, I do not know. I cannot judge that yet but I tell you

when one person is laid off it affects the economy. Of course it affects the

economy because that many more dollars are taken out and the economy shrinks. I

cannot really answer that because I do not have the specific number. I can only

tell you in a general sense that any layoff affects the economy. Will it have an

affect on disposable income of people? -- of course it will. Will that cause

those particular people to re-evaluate whether that limited disposable income

will be used for vacations? Of course it will, but counterpoint to that, of

course, is the increased amount of business travel that we are seeing daily into

this Province, coming from as far away as Paris, Norway, New York on this side,

and Boston, Toronto and Montreal, coming in to participate on a daily, weekly,

monthly, and yearly basis into the Hibernia project. That, of course, is going

to increase business travel and increase the consumption of services and goods

in the Province so there is a counterpoint to that that we must recognize. You

talked about what we are doing for hunting and fishing in Labrador. We have a

very specific guide that we send into the

international marketplace, my Tourism branch. I do not

know if the hon. Member has seen it. It is quite top-notch quality. It is giving

direct benefits particularly to Labrador which is highlighted very specifically

throughout that guide. We participate in trade shows. I just had an opportunity

to give a speech in Toronto in front of 150 magazine writers from across the

country and talked about Labrador and its great rivers and wilderness and

adventure tourism.

My Department participates in trade shows. It will

help councils and others who want any specific promotions. We deal with specific

camp and outfitter and lodge owners in Labrador, helping them to specifically

promote their particular ventures. We changed the rules last year on guiding and

outfitting to ensure that - for example, the problem in Labrador was Americans

were coming in using their own planes, bringing their own supplies, buying

fishing permits, bypassing the local industry, not purchasing any local

groceries, not purchasing any local fuel, not using local guides, and just

setting up, as it was pointed out to us, canning and freezing fish and taking

huge quantities out of Labrador's rivers and Newfoundland's streams.

We put a stop to that. We established very solid

guiding regulations where only Newfoundlanders can have carte blanche the right

to fish in these rivers and streams. Anybody coming in must now have a licence

and 800 metres to either side of the road, and streams and rivers beyond that

they must have professional guides. Which will increase our employment, look

after our conservation and deter people from canning, freezing and poaching, and

raping our rivers which has been going on for far too long.

So that was a very positive and constructive guideline

we put in place. It takes those middlemen out, those Americans and others, who

are coming in to Labrador big game hunting and fishing and taking without giving

or leaving anything in the economy. So we feel very good about that.

You asked about the Trans-Labrador Highway. We have

input into all modes of transportation. For example, airlines have done a

marvellous job promoting Marble Mountain. We encourage them to co-operative

advertise with us on all tourism projects. The Trans-Labrador Highway I feel is

very important. We do not have the fiscal competence to produce or construct

that highway. But certainly it is a priority from a tourism and economic

development perspective. I had an opportunity to bring the Resource Policy

Committee to Labrador a number of months ago and we met with the town council of

Happy Valley - Goose Bay, and that was a priority for them. I spoke in your own

district some months ago at the International Dogsled Races, and at that time I

took the time to have a meeting with the Wabush council. That was a priority for

them too.

With the construction of the Ossokmanuan Bridge now we

have that access to go through. It is just a matter now of convincing the

Federal Government that this indeed is a priority. I think you are right in your

'Field of Dreams' judgement that put it there, and it will draw economic

development and opportunity for people. I think it would be a tremendous tourism

benefit myself, personally speaking. But I think it would draw like a magnet

enhanced economic development.

Now there was some - you asked a particular question

about whether there would specifically be surveys done in Labrador West? Is that

what you asked?

MR. A. SNOW: Yes. Part of the survey has been done

Province-wide, I believe that Mr. Blundon talked about it.

MR. BLUNDON: I believe we talked to 2,500 to 3,000

Newfoundlanders and Labradorians. I am not sure what the percentage was from

Labrador. But it was supposed to be a cross-section of the entire Province. That

will give us an idea of resident travel, what they expect, some concerns and so

on that they raised to give us a more planned focus on how we address some of

the concerns that have been raised. I believe we talked at the last meeting that

it is one of the Minister's priorities to ensure that we have a tourist chalet

just as you enter Labrador West. That in itself once we build it is going to

give us the good solid information about the travellers who are coming into

Labrador.

MR. A. SNOW: So you will be conducting - part of

the survey will be done in western Labrador this year?

MR. BLUNDON: The actual telephone survey has

already been completed. We are just trying to summarize the results. But I can

certainly get you information on the numbers of telephone calls that were made

to the people of Labrador. That was included in that survey.

MR. A. SNOW: What about the people from outside

the Province entering the Province? Rather than just the resident population.

MR. BLUNDON: The domestic travel survey was just

to try to identify the travel patterns of Newfoundlanders and Labradorians. The

travel patterns of non-residents are done through what we call auto and air exit

surveys. Those are the people in the airports and at the various terminals and

what have you physically asking people about their travel plans - what brought

them here, how much money did they spend, what did they enjoy, what didn't they

enjoy, that type of thing. That is presently being finalized as well.

MR. A. SNOW: And that will be conducted in western

Labrador?

MR. FUREY: (Inaudible) could I just make an offer

to you, to come by the Department of Tourism and they would be glad to show you

how we conduct these surveys, give you all the statistics, break out right down

to the streets in your district if we can. But we would be glad to do that,

sure.

MR. A. SNOW: Well, my point is, Mr. Minister, that

I would want to see the survey being conducted within western Labrador. Because

that is a gateway to the Province.

MR. FUREY: Well, I tell you we would be more than

happy. Mr. Blundon will set it up for you anytime you are available to come and

see how we approach these surveys and how they are done, and seek your input.

MR. A. SNOW: Thank you. So you have suggested that

your department did have input into the non-resident angling regulations you

talked about, the 800 metres on rivers and streams. That requirement, of course,

is not applicable on lakes, and I would imagine that the rationale behind the

800 metres is that we can allow a tourist, if you will, to drive along the

highway and he or she may get out and walk up or down a river for 800 metres,

not the full length of a river, to fish, without the necessity of a guide, and

yet when we apply the regulations on a pond or a lake the adjacency rule

suggests that it is the whole pond or lake, and that is not working properly.

Can you tell me what rationale was used to include the whole lake or the whole

pond?

MR. FUREY: I am not sure you are correct. What I

will have to do is get the actual regulations and give them to you. I cannot

answer that right now, I do not have them before me. I do not know if Mr.

Blundon (inaudible).

MR. BLUNDON: Well as I understand it the

regulations are 800 metres of a highway system. I could be corrected, but I was

not aware that if a person went on a lake and the lake happened to be fifty or

sixty miles that they could just use that 800 metres and go anywhere on that

lakes. I know it comes down to an enforcement issue and what have you, but I

thought the regulations were specific on 800 metres.

MR. A. SNOW: Yes, well this is where they can use

a guide without an outfitter on a lake and that is creating a lot of problems

within western Labrador because of the size of the lakes, and I think it is

something that should be looked at, there were a lot of problems last year and

we are expecting a lot more problems this year.

MR. FUREY: I would gladly take that under

advisement, and any specifics that you can give us we would be happy to look at

them and see if corrective action can be taken because the intent of the

regulation is not as you articulate but as I have articulated to protect and

conserve the rivers for local people and for the economic benefit when outsiders

come in. That is the intent. But if the intent is in some way being misconstrued

because of the language of the regulation, we are quite open to corrective

action. So we will take that under advisement, Mr. Snow, and have it checked.

MR. A. SNOW: The reason I am continuously raising

the problems associated with the inland fishery, albeit it is not directly

pertaining to your department, but it does play a very important role in the

development of tourism in western Labrador and in all of Labrador because of the

type of traveller that we are attracting to Labrador. So I think it is important

that we protect the resource, which was the whole idea behind these regulations.

The other problem is enforcement. I would suggest that

your department also have another look at other provinces to measure how they

enforce the regulations, because with the limited manpower available in western

Labrador it is impossible for them to enforce the regulations as they are now.

They do not have the resources available to the too few people there enforcing

it, and you have to come up with a different method. There are other methods

available that other provinces use.

MR. FUREY: I agree, that has to be looked at, but

the increase in the number of guides certainly is helpful. A lot of people are

taking courses now. I think Labrador is a leader, actually, in the establishment

and the promotion of courses in the college there for guiding. New Brunswick is

looking at your courses right now as a matter of fact. The other thing is that

you would be surprised how many people, ordinary citizens, phone to let

Governments and others know when people are misusing a resource. In fact, when I

sat in Opposition I used to get weekly phone calls from people telling me about

Nova Scotians and others in that ten mile lake behind Hawkes Bay who were

fishing out the lake and canning the fish, and there was absolutely nothing we

could do about it. There were no regulations in place, nothing in place. I

checked it, but I would say to them: well, there is no law, there is no statute,

they could go in, they do not need guides, all they needed was a fishing permit

I believe.

Mr. Woodford, you probably heard some of those

complaints as well out your way; so the problem was, it was a two-pronged

approach:

number (1) to conserve and number (2) if you are

coming in to take, we want the economic benefits; and of course the employment

which comes along with that by the increased number of guides having seasonal

jobs, particularly in rural Newfoundland.

We will look at any anomalies there and try to find -

MR. A. SNOW: I would not be surprised at the

number of calls that you had while you were in opposition; while I do not get

them from Hawkes Bay, I do get some from western Labrador and eastern Labrador.

MR. FUREY: But I take it that you are in general

support of the thrust of that policy.

MR. A. SNOW: Yes, with a few corrections, if you

will. One of the suggestions was that the guides be appointed as wardens. This

would probably help.

MR. FUREY: That is a thought, yes.

MR. A. SNOW: I believe other provinces use that

method.

MR. FUREY: Do they deputise them for that period

of time when they are guiding? That is a thought; it is a good idea.

MR. A. SNOW: You mentioned that you were not sure

what the effects of the public sector lay-offs or rationalization will be on the

economy especially Tourism; I am not sure if you suggested that there is going

to be an increase in the value of Tourism to the Province this year, I am not

sure if it were you or Mr. Blundon, it was you, Mr. Minister?

Well, I find it difficult to understand if there is

going to be an increase, how can you suggest that you have not factored in the

fact, that we are going to have a couple thousand fewer people working in the

Province?

MR. FUREY: I do not think you listened to me, Mr.

Snow -

MR. A. SNOW: I listened to you. Undoubtedly, Mr.

Furey, it is just that I probably did not understand it, that is all.

MR. FUREY: Well you obviously did not understand

it.

What I said was, when you take one person's job away,

the economy shrinks to the extent that, that person does not have the same

income. Now, I said that when these jobs are taken away, yes, it will have an

impact, there is no question that it will have an impact.

Counter point to that, is the Hibernia and other

projects that are happening in this Province which is causing a significant

influx of foreign travellers into this Province; they have to eat, they need

their suits pressed, they need hotel rooms, they need to rent cars, they pay for

airline tickets and on and on and on and on. I am telling you that is going to

cause a significant increase, and it is not my projections.

These are the projections of The Tourism Research

Institute of Canada, which is a sub-component of the Conference Board of Canada,

and they are saying that in Canada generally, tourism will be down, but they are

saying specifically in Alberta and in Newfoundland, there will be increases,

there will be positive growth, so while other provinces will experience negative

growth, Newfoundland and Labrador and I believe Alberta, will experience

positive growth.

Perhaps the most compelling reason for that is

Hibernia's shift into high gear as a great number of contracts will be called; I

think for example, over the next three months there will be some $500 million

worth of contracts called and tendered and money flowing, so that has to have a

positive impact.

It would be far more positive if we did not have those

people laid off; but, you understand the economics, you are a businessman, you

know why we had to do that; we did not want to do it, it was painful to do it,

if we had our druthers we would not do it, it was actually a very despicable

thing to do from our point of view, but you know what the limited options were.

Increased taxation in a Province that is burdened with

the most ridiculous taxes in the country; swell the deficit even further beyond

the $5.4 billion to which it grew over the last eighteen years, or cut services,

recognizing that the bond markets would limit your ability to borrow, so those

were the options and in that context, had there not been significant layoffs,

there would have been even more positive growth, but we are still on a positive

growth pattern and that is what I am saying.

MR. A. SNOW: Yes. I am not questioning the merits

of why you did the, to quote you: 'the despicable act of laying off the public

employee'. I am not questioning the merits of that, I question whether or not

there is going to be an increase in the value of tourism because of the fact

that I believe that those surveys were done prior to the announcements of the

public sector layoffs. So no, I do not want to be considered as just raining on

your parade, but merely to suggest to you that the figures are not correct.

Because it was not factored in what the affect would be of having several

thousand public sector employees laid off.

MR. FUREY: And I am saying to you that it was a

despicable position to be in, to have to do that. Will it cause a percentage or

a partial percentage point downward? It may. I have no way of predicting that.

But I can tell you that we expect a significant influx of people doing business

in this Province over the next twelve months and that has caused us to agree

with the Tourism Research Institute, which is a branch of the Conference Board

of Canada, which says clearly that Newfoundland is on a positive growth pattern

and it will be one of two provinces in the country that will grow.

MR. A. SNOW: Prior to the layoffs that was done.

Anyway. With regard to travel generators in the Province, one of the upcoming

events that a lot of people within and outside the Province have been talking

about is the 500th anniversary celebrations.

MR. CHAIRMAN: Mr. Snow, by all means carry on with

your question. The Minister can deal with it. I just want to remind you that you

personally are fast approaching the thirty minute mark and I may want, after

this question, to move to someone else unless they want to grant you the leave.

But carry on with that question.

MR. A. SNOW: I apologize if I am taking anybody

else's time. They can surely interject. I could not have been a half an hour, it

must have been the length of the answers (Inaudible).

AN HON. MEMBER: (Inaudible).

MR. A. SNOW: Anyway, the 500th anniversary: I

wonder what the status of that is, the celebrations. I think that it is

something that is very important to this Province and -

MR. FUREY: It is and we are paying quite a lot of

attention to it. It is being led right now by Minister Gullage under the

Historic Resources section, and there is a special anniversaries committee

chairman in place, Mr. Bob Jenkins I believe, and a team of senior officials of

which Mr. Blundon sits on that committee. They are working diligently. I have

had some preliminary discussions with Ottawa about this. We think it is not just

a Provincial celebration but a national celebration and a very important one. We

are giving it a lot of attention. I do not know if Mr. Blundon wants to add

something from the committee perspective. I do not know if there is much to add

really, is there?

MR. BLUNDON: Only that the planning process

started about a year ago and we thought the 1997 celebration was far too big for

a senior group of bureaucrats to look after themselves and get everybody in all

corners of the Province involved. We sought Cabinet approval to widen the scope

of that committee. Recently they have approved that and over the next five to

six months I think every community in the Province is going to see some activity

starting associated with that 500th anniversary celebration. We have five years

to do all the planning, put everything in place, and it is something that we

have never had this much lead time in the past. However, we have never had an

anniversary of this significance in our history. It should dwarf anything that

has ever been done.

MR. A. SNOW: I seem to remember reading something

about where another province is claiming a similar right to the landing site

-the Province of Nova Scotia, I think it is.

MR. FUREY: I think Cape Breton was saying that one

Giovanni Caboto perhaps landed there but they are just talking through their

hats. Everybody who knows anything about history knows that he landed at

Bonavista Bay in 1497 and we are quite prepared to stand on that historical

record and promote it from the perspective of Newfoundland. But if the Cape

Bretoners want to come over here and join in the celebrations they are more than

welcome.

AN HON. MEMBER: (Inaudible).

MR. BLUNDON: Yes, we heard the same rumours and

Mr. Jenkins followed up on some of those rumours with some people over in

Bristol. There was the comment that the Cape Breton group had made contact with

the group in Bristol to try to make arrangements for a replica of Cabot's ship

to go to Cape Breton in 1997. Mr. Jenkins followed up on that specifically with

the people in Bristol who never heard tell of it. Why are you even bringing up

Cape Breton? -- was the question. Where are they? So,

I am not sure there is substance to it.

MR. A. SNOW: Maybe I should request that it be

stricken from the record then.

AN HON. MEMBER: Yes.

MR. FUREY: Request granted.

MR. A. SNOW: I do not have anything else right

now. Maybe somebody else does?

MR. CHAIRMAN: Mr. Woodford.

MR. WOODFORD: Thank you, Mr. Chairman.

I would just like to make a comment on some of the

Minister's remarks pertaining to the increase in tourism for Newfoundland this

year. Back in March I read an

article which appeared in the Chronicle Herald,

Nova Scotia, and they were saying that just pertaining to the Maritime Provinces

the only place there would be an increase in domestic pleasure trips would be in

Newfoundland, some 2.7 per cent. Just this morning in the Globe and Mail, I

think it was the Economic Board of Canada that suggested, it would be a 2.5 per

cent increase and I thought it said, if I am not mistaken -

MR. FUREY: Two point five in Newfoundland?

MR. WOODFORD: Yes. I think it was only in

Newfoundland.

I saw before the same figures you were talking about

comparing it with Alberta and I think it is primarily due to Hibernia.

MR. FUREY: Yes, business travel.

MR. WOODFORD: Yes, business travel and so on.

While it is I suppose below the inflation rate which means no real growth, that

is what they are saying, when it is below the inflation rate there is no real

growth, it is still a good sign that we are the only Province that would have an

increase in any case.

Pertaining to Enterprise Newfoundland and ERC but

mainly to Enterprise Newfoundland, what is the difference now between the number

of employees employed by Enterprise Newfoundland compared with the number that

were employed by NLDC and Rural Development, I believe you gave some figures on

that before.

MR. FUREY: I did in the House. Yes.

Did you want me to comment on the Globe and Mail thing

first?

MR. WOODFORD: Yes.

MR. FUREY: My only comment is that I agree with

you and it just really confirms some of the projections that my own people in

tourism last year came up with. We think that Newfoundland is on the right

course but it is not all just business travel. Like Mr. Hewlett, I like to give

credit where credit is due and I publicly stated this in a number of my speeches

to the hospitality industry and others Mr. Woodford and that is, if there is one

area where the previous Government did do a good job it was in tourism and I

think they laid a very solid foundation in that industry. I think some of the

previous agreements that were negotiated were very good agreements. Even some

previous presidents of Hospitality Newfoundland and Labrador deserve a little

credit and your Chairman here today is a former President.

But previously Government did put a good framework in

place, some good groundwork and it is not just business travel, it is the

marketing end of it. The marketing that was done in the past was done very well.

The marketing that is currently being done is terrific and we are very pleased

with it. In fact, we have an increase in our marketing budget this year. Three

marketing agreements and an increase in marketing. So while there is an increase

in business travel we think there is still going to be an increase of people

coming here for purely pleasurable travel to come for adventure tourism, for

hiking, canoeing. Now, our winter product has taken off incredibly well on the

West Coast and at Clarenville - skiing. How many skied Marble last year?

MR. WOODFORD: Three thousand outside.

MR. BLUNDON: Oh, about 100,000.

Over the last couple of years we have seen a

tremendous increase in the number of what we call non-local residents in the

Corner Brook area going to Marble and actually it is the same thing for the

White Hills. What we are finding is that, yes, discretionary income is down and

that will obviously have a negative impact on people travelling. What we are

finding is, the awareness of the infrastructure that is in Newfoundland from a

park and a historic resources perspective with things coming on stream like ski

hills and what have you, people who traditionally would spend three weeks out of

the Province are now taking a week of that and are spending it in Newfoundland

whether it be in winter activities like skiing, skidooing, cross-country or

whatever. The redirection of some of the funds that people traditionally would

spend out of the Province - we all recognize that Newfoundlanders probably, as a

Province, spend more in Florida than any other province in Canada. With the

build up of infrastructure we are finding that people are starting to leave a

few dollars in the Province.

MR. WOODFORD: Yes, I just wanted to make a comment

on that. You mentioned the figure of 100,000 through (Inaudible)?

MR. BLUNDON: One hundred thousand skier visits to

Marble Mountain.

MR. WOODFORD: Just Marble Mountain alone.

MR. BLUNDON: Just Marble Mountain.

MR. WOODFORD: But that is primarily local,

apparently, it is (Inaudible).

MR. BLUNDON: Of that there is, I think, about

10,000 skier visitors would be from out of the Province. Actually they are doing

some of their statistics now. I think last year there was another 10,000 or

15,000 skier visits that came from the Avalon Peninsula and other areas of the

Province.

AN HON. MEMBER: (Inaudible).

MR. BLUNDON: Oh yes, it is on (Inaudible) it has

been going up every year.

MR. WOODFORD: Yes, there was 3,000 last year from

outside the Province and 5,500 from outside the Corner Brook area.

MR. BLUNDON: Yes. That is 3,000 people. But they

stayed an average of three days, so that is where they get these 10,000 skier

visits.

MR. WOODFORD: Yes, longer stay, yes.

MR. FUREY: Just to pick up on that point. I am

very impressed with what is happening at Marble Mountain. I think that it is a

real classical example of diversification and I think that every government

dollar in the past that was put in there was well spent. And every government

dollar, and this Government particularly has put in a lot of 100 cent Provincial

dollars in the last two years. Hopefully when the tourism agreement is signed

there is a component there for Marble Mountain as well.

Just turning to your other question, you asked me how

many employees are in Enterprise Newfoundland? How many were previously with

NLDC? How many were previously with various departments of the former ministry

of RAND and the Department of Development and Tourism, Historic Resources and

that kind of thing. When I became Minister of the Department NLDC had

sixty-seven employees. From the Department of Development which made up those

four ministries that were collapsed into one we moved eighty-two employees into

the old NLDC for a total of 149 employees. New employees hired a little over a

year ago, I guess, twenty-nine, for a total of 178 employees in the five regions

right across the Province.

MR. WOODFORD: What would their total salary be?

MR. FUREY: Total salary. The total salaries and

benefits, Mr. Woodford, would be $9.6 million. In other words what I am saying

to you is that all employees were there with the exception of twenty-nine. So

all these salaries would have been there under the previous government with the

exception of twenty-nine, for a total of $9.6 million in salaries and befits.

MR. WOODFORD: There is one thing I could never

understand about the - while I agree with the concept of Enterprise

Newfoundland, especially with the decentralization part of it and being able to

make decisions locally and so on - why you would want a director for Enterprise

Newfoundland on either side of the Bay of Islands.

MR. FUREY: Say again.

MR. WOODFORD: There is a director for Enterprise

Newfoundland on both sides of the Bay of Islands.

MR. FUREY: A director.

MR. WOODFORD: Yes.

MR. FUREY: You mean a little satellite office?

MR. WOODFORD: No, no, it is a director, working

out of the Enterprise Newfoundland office in Corner Brook.

MR. FUREY: Out of Corner Brook. Yes, okay.

MR. WOODFORD: Yes. A director for one side of the

Bay of Islands, a director for another on the other side, the north shore. Is

there any logical explanation for that?

MR. FUREY: No, I did not think that they were

specifically targeted out of regional offices, Mr. Woodford, for specific areas.

The only time we give a specific area is in, for example, Labrador West - there

is a specific satellite office there. In Deer Lake there is a specific satellite

office. But I do not know that they are - are they nominally called 'Bay of

Islands South,' 'Bay of Islands North' directors?

MR. WOODFORD: Well, the people whom I have -

MR. FUREY: I would be surprised if that were true,

Mr. Woodford. What we do have is a complement of eighteen in that regional

office which services a great, large area as you know, all the way south to

Burgeo, all the way west to Port aux Basques, all the way north to St. Anthony

and all points in between. I do not know that somebody is specifically called

the director out of the Corner Brook office specifically for Bay of Islands

South.

MR. WOODFORD: Well, I can stand to be corrected on

that but this is coming from people right in the office, I mean, I have talked

to some of them. So I mean maybe it is a wrong

interpretation of their job, you

know.

MR. FUREY: It may well be. I will have the

president -

MR. WOODFORD: (Inaudible) check it for me I mean -

MR. FUREY: - check it out for you.

MR. WOODFORD: When I see a development association

working on either side of the Bay of Islands and in White Bay South, and in the

Deer Lake area and one ACOA representative for the whole west coast and Labrador

area. I just do not understand.

MR. FUREY: Yes. I guess that is why we are doing

great work, yes? And ACOA might be a little bit -

MR. WOODFORD: The jury is still out on that.

MR. FUREY: That is true. But we have asked the

Federal Government to participate with our offices and they chose to go their

own way.

The President may have an answer to what you are

talking about in terms of the director for the south and north of the Bay of

Islands.

MR. JANES: I think, Mr. Woodford, what we are

looking at here is the deployment of regional consultants. As you are probably

aware the regional consultants have contacts with the various development

agencies, to the extent that there are development agencies in the north shore

and the south shore of the Bay of Islands, well then, someone would be

responsible and there may be a split so that of two regional consultants they

have the north shore and other territory and the other one does the south shore,

but as far as directors are concerned, the directing positions in each regional

office, there is responsibility for the regional activities and therefore would

not have a specific area to deal with. The regional consultants would because it

is their requirement to go out and meet with development associations and other

clients.

MR. WOODFORD: So if they are there, instead of

directors they are called regional consultants.

MR. JANES: A regional consultant, yes.

MR. WOODFORD: We have a consultant to cover Deer

Lake, and I believe he covers the White Bay area, so I just could not understand

the justification of having one on either side of the Bay of Islands.

MR. FUREY: Your comment about ACOA. You were

saying that ACOA has one person?

MR. WOODFORD: Yes, to service the west coast, but

I agree it is not enough.

MR. FUREY: I would say.

MR. WOODFORD: It is definitely not.

MR. FUREY: Just ask the people in my district. I

know this fellow and he has the correct name, he is a sterling performer, that

fellow, but he has no authority to make decisions, none whatsoever, and therein

lies the difference. We need the manpower and the expertise so that we are

making the correct decisions in the regions for the local people, but if you

think we are having too many people and you want me to close the office in Deer

Lake I will take that under advisement.

MR. WOODFORD: I am not suggesting closing the

office but I totally disagree publicly and privately with a consultant on either

side of Bay of Islands. It is just not justified as far as I am concerned.

MR. FUREY: But I think they are regional

consultants who fan out -

MR. WOODFORD: But, even so, when you look at the

population of the north shore versus south, the Deer Lake - White Bay area, and

even your area, it certainly does not justify one on either side of the Bay of

Islands. That is all.

MR. FUREY: We can certainly check to see. It may

be just semantics Mr. Woodford and we will certainly check it out.

MR. WOODFORD: That is right. He may be covering

another area in Corner Brook with the north shore. I do not know. I would just

like clarification.

MR. FUREY: I am sure we will get the specific

answer for you and give it to you.

MR. WOODFORD: Has your Department anything to do

with this dimensional stone?

MR. FUREY: In Deer Lake?

MR. WOODFORD: Well, all around the Province. Deer

Lake is one but I think that Enterprise Newfoundland and the Gander area is

involved with the association in Buchans, the Lumsden area, and so on. What is

the latest on that particular project in the Province?

MR. FUREY: I am going to ask Adele to comment on

that. The Recovery Commission has been very involved in it, but I should just

tell you that I met with people in Deer Lake three weeks ago. For your own

benefit, Mr. Len Pye, and perhaps you know him because he has done some work out

there. Who is the consultant he hired, the fellow from Corner Brook? He is very

involved in hockey but I just forget his name right now. It will come to me in a

minute. Anyway, he and I had a very good meeting at the Deer Lake motel for an

hour or so, and he claims to have found a substantial amount of marble, for

example, in the (Inaudible) area and he has asked my Department for some help to

go to a trade show in Italy which takes place during the first or second week of

June, and we are now processing his applications under a program called Market

Product Development program where we pick up 50 per cent of the cost for people

to do that. I think that is being looked at this morning, to help him out with

that. It is a substantial cost, you know, to get to these shows, to participate,

and to meet contacts and set up new marketplaces for yourself. I think it is

$8000 of which we are prepared to pay 50 per cent. With respect to your question

on dimensional stone I will ask Adele to address it because the Recovery

Commission has been very involved in it and I know through Enterprise that

Vice-President Lush in Gander has been very involved as well.

Adele, do you want to address that?

MS. POYNTER: We have been, actually, and it has

been a joint effort between the Recovery Commission and the central office for

Enterprise Newfoundland and Labrador in many areas. First of all, in terms of

this group you were talking about, there is now a stone producers association

which was an initiative of the Recovery Commission and the vice-president for

Central Newfoundland, Fraser Lush and Wayne Humphries, mostly from our office,

have worked with that group and they are formed now and they will be

representing their concerns and basically trying to get the industry up and

going.

As well, we have been involved with several ventures

through the corporation again, to help them with financing and other sorts of

services and as well, just through our own efforts because we are looking at

non-traditionals of applications in the mining industry, so we are working with

a number of granite producers in Central Newfoundland.

Many of them are in Central Newfoundland as you know

because of the geology, but also with calcium carbonate producers up in

Roddickton area and even with bricks on this end, in the Trinity end. We are

also looking at some 'furthers' to the value added, processing ceramics

facilities, central milling processes on the Baie Verte Peninsula; a number of

things really with ENL, initially, and also in conjunction with the Department

of Mines because of course they have the lead in that area.

We are also going to be establishing a mining/working

group in the fall under the ERC as part of our New Opportunities for Growth; we

are looking at various things there, from the business climate to trying to

increase the input into the mining industry, so we will be looking beyond new

applications, like dimension stone and into for example, input into IOC in

Wabush and Labrador City, so we are doing a number of things in the mining area.

MR. FUREY: Just to follow up on that, Mr.

Woodford, you would be interested in knowing too, that the Recovery Commission

just helped put together a joint venture a little while ago and with some

financial support from Enterprise Newfoundland have caused a mine to start

operations out in Nut Cove where fifteen people are now working and they hope to

expand it significantly.

There is a group coming from Paris next week to take a

look at that operation, slate mining, and it is used now as you know in roofing

particularly, and it is a big market and it is very hot in California and in a

number of places around the world, but the slate out of this mine is said to be

extraordinarily exceptional and what we will do is, have people actually mining,

cutting, cleaning, preparing for the marketplace, trucking and then shipping, so

there are quite a number of jobs in it and there is a substantial find out there

I am told, Adele, in Nut Cove.

100 years yes; 5,000 tons a year is it? -- yes.

Anyway, these things are happening and this was identified as an opportunity for

growth by the Commission and they are pursuing it.

MR. WOODFORD: Yes. On the dimensional stone again,

I am getting some conflicting reports; yes, Enterprise Newfoundland is involved

in it and, yes, they have been very supportive and yes, the ERC and the people

in the Department, there were no problems there, but the impression I am getting

is that there is a conflict between mines and development or officials in the

Departments with regards to where a processing facility should go.

I understand there is a request in for a processing

facility in the central area and he has been more or less blocked and stymied

and obstacles were put in his place in every way, shape, or form, pertaining to

a processing facility, and when I look at a piece in the paper like: the central

area may get new grant industry and Central Newfoundland Community College

advertised for a male or female stone quarry worker instructor for the work

primarily in the Greenspond/Lumsden area, which is one of the areas identified

for the dimensional stone and in conjunction with that, when I asked the

Minister of Energy, he said the two best places in the Province identified are

Seal Cove and Nain; two of the better products -

AN HON. MEMBER: Marble.

MR. WOODFORD: Yes, marble.

MR. FUREY: Did he mention the Deer Lake find?

MR. WOODFORD: No. Well that is there but the only

thing about the Deer Lake find, apparently it is not as - the colour has a lot

to do with it. The Nain one -

MR. FUREY: Have you seen some of the samples?

MR. WOODFORD: Yes, I saw it but they are not -

MR. FUREY: They are extraordinary, are they not?

MR. WOODFORD: Yes and maybe -

MR. FUREY: The have just drilled 800 feet and

pulled up core samples in various parts of the mountain.

MR. WOODFORD: But the show that they had in -

where was it, in Arizona or somewhere -

MR. FUREY: I believe so, yes.

MR. WOODFORD: About a couple of months ago they

had a show and all those samples were there then, but the two that the people

went for, people all around the world especially from Italy I believe, were Seal

Cove and Nain, especially the Nain deposit.

But anyway -

MR. FUREY: Nain, did you say Nain or Roddickton?

MR. WOODFORD: No, Nain, that was two -

MR. FUREY: Interesting. You know Roddington is a

hot property in terms of marble as well. But let me just address your question,

is there a conflict between Energy, Mines and Development?

MR. WOODFORD: What I am getting at is, if someone

wants to start a processing facility to process this stone, there seems to be,

in my consultations with them that there is some conflict of where

it should go, and that is probably the hang up.

MR. FUREY: I really and truly am at a loss. Let me

just say this to you so we do not embarrass any businessman, but if you have a

specific businessman who is having that kind of trouble, would you make it known

to Adele because the Recovery Commission's job is two fold, it is not just to

create an environment of positive business climate and to give us direction on

policy, but to remove stumbling blocks and anything that is inhibiting business

development and progress. So, Mr. Woodford, would you undertake to give Adele

that information?

MR. WOODFORD: Yes. I will have to check with him

first to see if he wants me to use this. I would not see any problem.

AN HON. MEMBER: I had to work with them.

MR. WOODFORD: Enterprise Newfoundland is saying

that it is a viable operation in the Province, and we have another department or

two saying that it is not a viable operation, and we are saying now -

MR. FUREY: Now that is a different question than

what you just said. Let me just say this: based upon the business plans we are

given, we can assess and say: this is a viable opportunity. But if you are

saying can we make the judgement on the technical mining side we cannot. So

there may well be a conflict for company A who brings in a proposition to us

that we say: based on the economics this is wonderful, but based upon the

geology and all that technical good stuff that Mines and Energy does, they may

say no, there is just not enough there, or the colours are wrong or it cannot be

taken out properly, or there are problems. So in that sense, Mr. Woodford, I do

not want to mislead you, there may well be a conflict. Is that what you are

saying?

MR. WOODFORD: Yes, I think there is, because they

were even stopped funding from ACOA. They had a possibility of getting $500,000

from ACOA to set up and start quarrying and so on, but I think the conflict is

in where it should go.

MR. FUREY: Please let us know.

MR. WOODFORD: I will talk to the individual, and

if he wishes to contact you I will certainly pass him along to you because I do

not think anybody should be stymied in that regard.

MR. FUREY: We agree with you.

MR. WOODFORD: The last time we met I had some

questions pertaining to the camps for the Hibernia development, and at that time

on that Friday there was supposed to be a possibility of enhancement. There is

nothing on it yet, and that has been going on now for about three weeks. What is

going on there?

MR. FUREY: The only thing I can tell you is that

the HMDC and Nodeco have called in a number of the bidders to get clarification

on what they have supplied. It is quite something when sometimes things that are

written down need

interpretation, so they have called in a number of companies

to get

interpretation on the bids. If my memory serves me correctly, I think

there were fourteen or fifteen companies that bid.

AN HON. MEMBER: Five.

MR. FUREY: Five Newfoundland companies, and

fifteen or something in total, but I think Mr. Windsor's question at the time he

said it was a fait accompli, that it had gone to a New Brunswick firm, and I

disagreed with him vehemently that this contract has not been let. I would

predict that it will be let within the next short while, four or five days. Our

latest information says four or five days. They are just clarifying some

technical matters in the documents so that they can proceed with the award, and

that is fair ball.

MR. WOODFORD: I do not know if this is a fair

question or not, but I will put it anyway. Are you concerned personally with

reports from the Newfoundland companies who just cannot seem to get to first

base on the Hibernia project, not only with regards to the main project, I could

understand some of that, but with regards to sub-contracts as well.

Especially with the quality assurance and (inaudible).

MR. FUREY: Yes, there is a level of concern, Mr.

Woodford, there is no question. And some of these companies have made their

concerns known to us. Some of them are engineering companies, some of them are

small companies that hope to supply products to the various things, but yes,

there is a level of concern. In fact today I am meeting with some people from

Hibernia to discuss some of those concerns, to ensure that Newfoundland gets

what these binding legal agreements say that we should get, and that there is no

pussyfooting around or no games being played, and I fully intend to do that. I

am meeting with some of the engineering companies in Paris this coming week, and

that is my message. Hibernia today but a lot more development up the road

tomorrow. Remember that the Government is watching, these agreements are legal,

they are binding, and we fully expect to get the fullest of benefits from it.

How has it gone so far? I think if memory serves me

correctly there has been over $100 million spent so far. Sixty-five per cent has

been Newfoundland content, 20 per cent Canadian content and 15 per cent foreign

content. We are doing pretty good so far and there are three mechanisms in place

to ensure that the watchdogs are looking from every angle. The

Canada-Newfoundland Petroleum Offshore Board, which is a Federal-Provincial

organization, you well know; the Offshore Business Division under my Assistant

Deputy Minister of Investment, Trade and Technology - is that what you call it?

I forget it; and of course the senior management committee of the Hibernia

Management Review Committee that is watching each contract as well.

So we have three of these groups looking from three

different angles at this and reporting - I think we get quarterly reports - to

the Cabinet exactly what is happening, who got what, what sub-contracts are let,

how much has been let, how many Newfoundlanders employed, where they are

employed. All this kind of stuff. To date it has been very good. But there are

some complaints coming in and we are very cognizant of it, we are very aware of

it. I fully intend to let some of these people know today over lunch, and I

intend to let the senior engineering company know in Paris next week. Because

Hibernia is just step one. Terra Nova, Ben Nevis, White Rose and all these other

discoveries and possibilities are out there waiting too. If people are not going

to play ball and deal with not only the intent and the letter but the spirit of

these agreements, we want to let them know upfront early.

MR. WOODFORD: The week before last I spoke on

Hibernia at the Chamber of Commerce meeting in Deer Lake. I had a lot of

questions. I was really surprised, I think I have mentioned it before, about how

many people did not know, did not realize, what the scope of the project was.

But in some questioning after I promised to go back to Nodeco and get some

information pertaining to the project itself, especially since it started, and

the contracts that were let.

I think I made three phone calls to Nodeco. I found

them very evasive and slow to respond. When they did I did not get much. I got

the name of the contract; name of the company, Newfoundland; name of the

company, Paris. Period. No dollars and cents, no phone numbers, no anything. I

find them very evasive to be honest with you. I asked a simple question, all

publicized I would say over the last couple of months, but I wanted all the

contracts put in a form so that I could present it to my people. Why should that

be so hard to give, I wonder? Anybody else finding that type of thing?

MR. FUREY: Just on your first point, the business

of people not knowing about Hibernia. I have run into a little bit of that, not

a lot of it. If anything was hyped out and talked about a lot in the previous

years, it was Hibernia. Let's be honest. Mr. Barrett, my predecessor, held many

seminars, gave many talks, many speeches, caused all kinds of teams of people to

move throughout the Province to ensure that people knew and could prepare and

were aware of what was coming. Also, in fact, in the last number of months we

have sent teams of people out to do seminars. You are probably aware of it. We

did a major seminar in Corner Brook for all the business people in the Humber

Valley - Corner Brook area. We did it in Marystown, up at Clarenville and in

Goose Bay. So you know, if anybody wanted information about the scope, size, of

the project, the costs and the various contracts and subcontracts, well they

could certainly have had opportunity to ask those questions.

Now with your specific question on Nodeco, I have not

had that problem myself. But I will just let the Deputy deal with other avenues

of where you can find information and stuff.

MR. CLYDE GRANTER: Yes, Mr. Woodford, the

availability of information on contracts has been a concern. It is still a

legitimate concern, I believe. The Petroleum Board, HMDC, Nodeco, NOC, all have

been approached on that issue and they have undertaken to be more forthcoming

with contract information. I think you will find - I do not know when you had

your speech that you referred to - but I think that you will find over the past

several weeks that several publications now contain information on qualified

bidders. It gives out phone numbers, it encourages local companies to contact

these people and if contracts have been awarded it then indicates who the

successful contractor was and how he can be contacted. So, it is something I

guess that is evolving. It has been a problem and we are still not satisfied

that the amount of information that is available is up to the standard that we

would expect.

MR. WOODFORD: Just one short comment. So,

apparently you and the officials of your Department are finding the same thing,

you must have had other complaints about the same thing, I guess, in order to

make such a comment.

MR. GRANTER: We have had representation from

various companies within the Province and we have followed up on those

representations with the petroleum board and with the Hibernia company and with

the prime contractors. I think as a result of these representations this, if I

could refer to it as greater availability of information, is what we now see.

MR. FUREY: I just mention that I am going to have

lunch with some Nodeco people and some Hibernia people in a short while.

Certainly, if you want, I can bring your concerns to them directly today.

MR. WOODFORD: Well, I would appreciate that. I was

not asking anything secret. I was not asking about a contract about to be let, I

was asking about contracts that were let. I wanted the names of the companies,

their telephone numbers and so on.

MR. FUREY: So, you could direct people for any

subcontracts or jobs or whatever. Yes, sure, I understand.

MR. WOODFORD: A simple procedure I thought to be

above board.

MR. FUREY: Who did you deal with there?

MR. WOODFORD: The Nodeco Office, there was a lady

there and finally after the third call she said yes, we will be glad to provide

the information, which was more than forthcoming, but then again when I got it

it was useless to me.

MR. FUREY: It was very vague.

MR. WOODFORD: What I was I suppose to do - when

you telephone Newfoundland Telephone for a certain company all you get is that

it is not listed. I mean it is a terrible thing to have to go through after

contracts have already been let. A very simple procedure I would say to give the

name of the company and where they are located and the telephone number.

So that is one of the things I think you should

address. Apparently, I am not the first one who has had trouble, I have been

talking to others.

MR. FUREY: Oh, we have had some companies advise

us they have had problems.

MR. WOODFORD: That is all that I have, Mr.

Chairman.

MR. CHAIRMAN: Mr. Snow.

MR. FUREY: No, you cannot have your chalet.

MR. A. SNOW: Next year.

MR. CHAIRMAN: Mr. Snow.

MR. A. SNOW: Mr. Minister, with the announcement

last week that the Governor's Park was going into receivership: We are all well

aware that it provided a very important role in tourist development in this

Province, the fact that it was a training centre for people in the Province in

the tourist industry and we have always recognized, of course, the importance of

having trained individuals meeting the public or tourists. Will, in fact, the

Province or the tourist industry be continuing to use Governor's Park this

summer in that role, or will they indeed be using another facility within the

Province?

MR. FUREY: I am not sure I can answer that because

I do not have the details in front of me on the receivership. I know that

Enterprise Newfoundland and Labrador and its predecessor NLDC was in there for

quite a bit of money. ACOA was in there for quite a bit of money. I do not have

the details of why the receiver went in or what caused the receivership to go in

or what the receiver's plans are. But we will certainly take a look at it.

MR. CHAIRMAN: Shall Department of Development's

Estimates 1.1.01 through 4.3.03 carry?

On motion, subheads 1.1.01 through 4.3.03, carried.

On motion, Department of Development, total heads,

carried.

MR. CHAIRMAN: Mr. Minister, thank you and your

officials for attending. Before the Committee leaves I would like to move the

Resource Estimates of May 9, 1991, Department of Forestry and Agriculture.

On motion, minutes adopted as circulated.

I would like to thank the Committee for their

cooperation over the last while. This ends the Resource Estimates for our

Committee and I would like to thank all those involved.

The meeting now stands adjourned.

Document details

Collection	Newfoundland and Labrador — Committees
Citation	1991-05-15
Type	committee
Volume / chapter	committees_standingcommittees_resource_ga41session3_1991-05-15_rc-dev_.htm
Language	en
Format	html
Source	PROVINCIAL
Identifier	45894fd58d24422a807111838814792e621526eb

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