April

27, 2009

RESOURCE COMMITTEE

Pursuant to Standing Order 68, Kevin Pollard, MHA for Baie Verte-Springdale,

substitutes for Wade Verge, MHA for Lewisporte; and Kevin Parsons, MHA for Cape

St. Francis, substitutes for Derrick Dalley, MHA for The Isles of Notre Dame.

The Committee met at 6:15 p.m. in the House of Assembly.

CHAIR (Harding): Okay, we are ready to begin.

I would like to welcome you all to this evening's meeting as we debate the

Estimates for the Women's Policy Office in the Office of Executive Council, as

well as the Department of Natural Resources.

First of all, I will ask the members of the Committee to introduce themselves

by name and district.

MR. BAKER: Jim Baker, MHA for Labrador West.

MR. POLLARD: Kevin Pollard, MHA for Baie Verte-Springdale.

MR. KEVIN PARSONS: Kevin Parsons, MHA for Cape St. Francis.

MR. HUNTER: Ray Hunter, MHA for Grand Falls-Windsor-Green Bay South.

MS JONES: Yvonne Jones, MHA for Cartwright-L'Anse au Clair.

MS MICHAEL: Lorraine Michael, MHA for Signal Hill-Quidi Vidi.

CHAIR: Okay. For the record as well, if the observers would like to give

us their names.

MR. LONO: Simon Lono, Official Opposition Office.

MR. MORGAN: Ivan Morgan, NDP Office.

MS CAMPBELL: Lori Ann Campbell, Official Opposition Office.

CHAIR: Thank you very much.

After the Clerk calls the first subhead and we will be dealing with the

Women's Policy Office first the minister may introduce her officials and

have up to fifteen minutes if required to give an overview of her department,

her office estimates for the year. After that, the first speaker then will have

up to fifteen minutes as well and then we will alternate after that if needed.

I will call on Minister Dunderdale now to

First, we will ask for the first subhead.

CLERK: Subhead 2.7.01.

CHAIR: 2.7.01. Shall that carry?

I recognize the minister.

MS DUNDERDALE: Thank you, Mr. Chair.

I thank you and my colleagues for being here this evening to discuss the

budget Estimates for the Women's Policy Office.

I would like to introduce Heather MacLellan, Assistant Deputy Minister for

the Women's Policy Office who is accompanying me this evening, as well as

Linda Vaughan, who is Director of Finance for Executive Council. I will leave my

introductions there until we get to the Department of Natural Resources and I

will introduce the rest of my colleagues.

CHAIR: That is fine, yes.

MS DUNDERDALE: I want to provide an overview of the budget for the

portfolio as well as the focus of our activities to advance the status of women

in the Province.

The total budget for the office and its activities is $4.5 million, an

increase of 165 per cent since 2003-2004. Part of this funding goes to the

Provincial Advisory Council and the Status of Women for the role it has in

advancing the status of women and advising government on policy matters and

issues related to women.

Since 2003, we have increased the budget for the Advisory Council by more

than 71 per cent. This year alone, we have provided the organization with an

increase of approximately $20,000 so its staff can receive the salary increases

provided to public servants. To ensure women's issues are being dealt with at

the community level, we also provide grant funding to many women's

organizations through the budget that is allotted to the Women's Policy

Office. We provide $2 million to the eight Status of Women Councils located

throughout the Province. This year, all eight councils are receiving an increase

of 5 per cent to their operating budgets for a total of $110,000 each. This is a

total investment of $880,000.

We also fund an annual meeting with the councils and the Women's Policy

Office to ensure that current issues are brought forward and information is

shared among these groups. This year, we are also pleased to provide the

Multicultural Women's Organization of Newfoundland and Labrador with an annual

grant funding of $100,000. This voluntary non-profit organization has been

serving immigrant and multicultural women since 1982. This organization is

looking to having a wider provincial presence as the immigrant population

continues to increase. Providing this annual funding is consistent with the

Province's immigration strategy and multicultural policy. We feel that this

organization is an important vehicle in helping to promote the Province's

goals for women's equality in the areas of violence against women, women's

economic equality and women's leadership.

Since 2005, this government has made it a priority to fund Aboriginal

organizations to directly deal with violence prevention. We provide $200,000

annually in grant funding for violence prevention activities in Aboriginal

communities. To date, up to thirty grants have been provided for a total

expenditure of more than $475,000 since 2006.

This year, we are also supporting the Rigolet Partnership Against Family

Violence with $60,000 in funding to help them prepare for a new women's safe

house in that community. We also spend $60,000 annually for the Aboriginal Women's

Conference to enable women from different Aboriginal communities and groups to

come together to discuss issues of importance related to the status of women in

their cultures and communities.

In addition to providing grants to women's groups and community

organizations, about $2 million of the budget for the Women's Policy Office

goes towards supporting its role of providing Cabinet departments and Cabinet

with policy advice as well as to lead programs to advance the status of women.

The Women's Policy Office is also the liaison between government and women's

organizations throughout the Province.

An important program the office leads is our six year Violence Prevention

Initiative. Over the past year we have provided funding of $720,000 for our ten

regional coordinating committees. This amount includes an additional $20,000 for

the Labrador committee to help offset costs associated with travel.

Approximately twenty-one violence awareness and action training sessions were

conducted around the Province with 230 frontline service and community workers

being trained. Six train-the-trainer sessions were also held with an additional

fifty-nine participants. Eleven of these sessions were held in Labrador, six in

Happy Valley-Goose Bay, two in Sheshatshiu, one in Labrador West, one in Forteau

and one in Makkovik. In this current fiscal year we are planning to undertake

violence awareness and action training in Nain, Hopedale, Cartwright and Black

Tickle during the month of May.

Funding is also being provided in Budget 2009 to follow up on a study on the

employment needs of women who are victims of violence. Information gathered

through this study will be introduced this year in the employment support

programs of the Department of Human Resources, Labour and Employment.

I also want to recognize at this time the work of the Women's Policy Office

in the new Family Violence Treatment Court introduced by the Department of

Justice. Through this office we also provide annual funding to the Newfoundland

and Labrador Sexual Assault Crisis and Prevention Centre $100,000, and the

Transition House Association of Newfoundland and Labrador $75,000.

I am pleased with the work being done by the Women's Policy Office and

value what we receive from our investments in this area.

With that, then, I am prepared to take your questions.

CHAIR: Thank you, Minister Dunderdale.

Ms Jones.

MS JONES: Thank you, Mr. Chairman, and thank you, minister, for your

update on the activities in the Women's Policy Office.

We just have a few questions. Starting first of all with the salary Estimates

under

section 2.7.01. Last year you were down on the amount of salary that you

had estimated you would spend. This year I see an increase again. I am just

wondering, were there some positions last year in that office that were not

filled, and are you increasing positions this year?

MS DUNDERDALE: The revision there reflects the savings of approximately

$159,600 which was primarily due to the delayed recruitment of the VPI older

adult training position and the WPO research position. The Estimates reflects

the increase of $64,000. That can be attributed to a $32,000, 4-4 per cent

salary increase adjustment, and $32,000 for the extra pay period we are going to

have this year.

MS JONES: Okay. Also under Professional Services you did not spend a lot

of money last year, $25,000. You are budgeting $80,000 this year. Is there

something specific that you are going to do this year? Is it a new project?

MS DUNDERDALE: Is that Purchased Services or Professional Services?

MS JONES: Sorry, I am on the wrong line. I have the Rural Secretariat and

the Women's Policy Office, both of them in front of me. You spent a lot more

than that, actually.

Under Professional Services last year you spent nearly $300,000. I am just

wondering what you would have spent that on.

MS MacLELLAN. There were nineteen professional services projects last

year. Sixteen of them were associated with our Violence Prevention Initiative.

For instance, we worked with a professor from Memorial University and we looked

at the best practices with respect to recognizing, preventing and intervening in

violence against older adults. That is a baseline documentation for us as we

work with the regional health boards around the Province to look at developing

training programs for their officials.

We also work with the Newfoundland and Labrador Stats Agency to design our

pre-test surveys and our surveys to evaluate our campaigns, our social marketing

campaign. We had other professional services to do with our violence prevention

conference we held this year on violence against women, including a contract for

Brian Vallee to come in and speak. So, those kinds of professional services.

MS JONES: Last year the RCMP were releasing statistics around the rate of

family violence in the Province. I think at that time they said there was 1,115

cases that had been reported. I am just wondering if you guys have any numbers

for the current year in terms of what would have been statistics reported for

family violence in the Province?

MS DUNDERDALE: We do not have the numbers for this year yet but we will

get them.

MS JONES: Okay. Also, when they made that statement last year they also

said in the statement that one of the common denominators in the family violence

cases that they were discussing was alcoholism. I know recently there was an

announcement with regard to family violence court and the enhancement of that

program. I am just wondering if you guys were consulted on that as the Women's

Policy Office and if you have made any recommendations that there also be some

kind of addiction services attached to sentencing or cases that are being dealt

with through that family violence court?

MS DUNDERDALE: We have been very engaged in that piece of work. There is

a variety of services that the aggressor - I mean they have to agree to

participate in programs in order to be in that court, to participate in that

court. While we have not made specific recommendations around addictions

counselling, that is certainly, in terms of how the whole program works, would

certainly be one of the services that they would have to avail of if it is

recommended from the assessment team.

MS JONES: Okay. With regard to the sexual assault centre in St. John's,

I know that it is the only centre now in the Province. I think they have had

funding since 1999. I am just wondering if you guys are looking at I know

that you have done, as you said on the last line item, a lot of consultation and

input around violence and violence prevention in the Province. I am just

wondering if you are looking at expanding the women's crisis shelter, the

programs that they offer? Because I know from discussions I have had with them

that they are certainly in a position to look at that and they want to look at

how they can expand their services. I think the last report I looked at with

regard to statistics is that the national average of violence right now is up by

25 per cent against women in the country. So I do not know if that was part of

your plan through the consultation or not.

MS DUNDERDALE: Well, we have certainly increased funding to the sexual

assault crisis centre and the year before last we made an increase of about

$25,000 to their annual budget to deal with just some of those issues. In this

year's budget we are expanding our shelters. There is funding in this budget

for a new shelter to be established out in Carbonear. That also is under the

auspices of Iris Kirby House. That will also provide an opportunity for Iris

Kirby to expand its program and develop its programs further for some of their

clients who have greater needs and require more intervention and more support

and need the services longer.

We are also working in Labrador, in Rigolet. We are putting $60,000 in, in

capital, to get a safe house ready there. We have also contacted the Nunatsiavut

government and we will work with the Nunatsiavut government to appeal to the

federal government to include Inuit communities in anti-violence funding, and

funding for shelters and so on. They do not participate here in the Province for

Inuit communities.

MS JONES: How much funding does each individual shelter receive now in

the Province? Is it the same amount everywhere?

MS DUNDERDALE: We will have to get a list from Health because the program

is administered through the Department of Health. It is approximately $300,000

per shelter, but it varies, depending on how much demand and capacity each of

them have.

MS JONES: There was a report completed this past winter by Cara

Transition House. It was done after they had volunteers that were observing

several cases in the court. I do not know what it was, like forty or fifty

different cases in the court system and how justice and the judicial system were

dealing with each of these individual cases. All of them were around domestic

violence. I think they reported a number of incidences around improper conduct

they felt by judges and by other people in the court system. I am not sure if

you were involved in that from the Women's Policy Office perspective but I am

sure you have had a chance to review the report. I am just wondering, is there

any action that is being taken through the Women's Policy Office to deal with

some of these issues and those concerns?

MS DUNDERDALE: The issues identified in that report, if I recall

correctly, were relatively minor in terms of the attitude that there was some

reference to a judge smirking, and there was another reference to some

dismissive behaviour the women felt of the victims in the courtroom in the

telling or the hearing of the story and so on. I know that the judiciary had a

copy of the report and the people there charged with the responsibility around

those issues dealt with it and dealt with it in a public way. We certainly had a

discussion of it in the WPO, and I have had a discussion with the justice

minister with regard to the issues that were raised there.

MS JONES: I guess there is no other action that is going to be taken in

terms of any kind of an education process within the judicial system. After all,

this is domestic violence cases and if women did not feel strongly about what

was happening in the courts they would not have sat through fifty cases and

documented all the information and to write a report.

I am just wondering if sometimes it may seem minor but you have to look at

the vulnerability of people who are using the system and requiring the services.

I just think that some kind of an education program around how you deal with

this within the system, what is appropriate, what is not appropriate. Even

though you are talking to professional people, I do not think it makes a

difference sometimes. Everybody can learn something different.

MS DUNDERDALE: Certainly, we are guided by the women from Cara House who

did that report. Cara House, as you well know, has a long history of dealing

with legal issues around and the courts and judicial systems and how they

deal particularly with women who are victims of violence. In fact, have done

outstanding work, and I have referenced Nellie Nippard and the whole federal

justice parole cases as an example of that. We have Elaine Condon who was

instrumental in that work, as a matter of fact, now works with the Provincial

Advisory Council on the Status of Women.

So we are very aware, and women who do this work in the community are aware

and we are all constrained in terms of the opportunities we have to educate and

sensitize the judiciary. It is a complicated process but it is one that we are

always aware of and where we can find opportunities to educate and raise

awareness and consciousness we do it because it is extremely important but it is

not an easy thing to do.

Heather just tells me that we just had a call from legal aid who have asked

us to train all of their workers, 120 of them, this year under the violence

prevention.

MS JONES: Good. Maybe we will get to the judges next.

MS DUNDERDALE: Start at the bottom and work our way up.

MS JONES: Yes.

Recently, I think it was in the Budget, they announced that there would be a

psychologist and an addictions counsellor now being placed at Her Majesty's

Penitentiary in St. John's. I am just wondering if the services of those

individuals are going to be available to the women's penitentiary in

Clarenville as well, because over the last few years we were always getting some

complaints about the lack of services there, especially I guess as it relates to

psychology and addiction services.

MS DUNDERDALE: Yes, and I am aware of the issues that have been ongoing

in Clarenville for some time. Now I will have to get the answer to that. I do

not have that answer for you this evening.

MS JONES: Okay. Maybe I will get my colleague to ask it in Justice. I do

not know, maybe it would be under Justice would it?

MS DUNDERDALE: Yes, it would.

MS JONES: One other question, around the midwifery legislation

MS DUNDERDALE: Yes.

MS JONES: You knew that was coming didn't you?

We have raised it many times in the House of Assembly and I know that your

office have had lots of discussion with the Midwifery Association in

Newfoundland and Labrador. I think everyone is anticipating that there is going

to be legislation, or at least they are hoping there will be. I do not know if

you can give us an update on where that is; what input you have had from the

Women's Policy Office into it. I am sure you realize the value in it.

MS DUNDERDALE: The Women's Policy Office has had its input, and this

minister has had her input long before she came to the Women's Policy Office.

It is an issue that I am very familiar with. All I can say at this point is, we

will see where it all takes us. It is something that I am very familiar with. I

have met with the Midwifery Association of Newfoundland and Labrador. My own

daughter was in receipt of midwifery services during her pregnancies.

MS JONES: So it is still on government's radar?

MS DUNDERDALE: Absolutely, it is.

MS JONES: You are still planning on bringing the legislation forward and

so on?

MS DUNDERDALE: Yes.

MS JONES: It is just a waiting game as to when it is going to happen, is

it?

MS DUNDERDALE: We will see.

MS JONES: Also, I do not know if you would know the answer to this. I am

thinking maybe it would be better put to the Justice Minister as well. The

construction of the new detention centre in Goose Bay for women, this was an

issue that was very high profile in the media after a case where a woman was

incarcerated in a male penitentiary. I guess what we are wondering is: What is

the plan to be able to move forward with the centre and what are the timeframes

when we are going to start seeing it in place and the program being offered?

MS DUNDERDALE: That question is better put to the minister. I will say to

you that the WPO is very intimately involved in that project.

MS JONES: Maybe you can tell me, then, if it is going to be a separate

detention centre or if it will be part of the penitentiary system that exists in

Goose Bay right now or if it will be part of the health care system.

MS DUNDERDALE: That question is better addressed to the Minister of

Justice, but in terms of the issues that have been raised in Goose Bay, the

treatment of women in the detention centre and where we need to go with that,

the WPO is engaged and giving advice and recommendations. They are being sought

and being given.

MS JONES: Okay.

I am going to defer to my colleagues now. I guess she has some questions.

CHAIR: Ms Michael.

MS MICHAEL: Thank you very much, Mr. Chair.

I am going to come back to the Budget Estimates themselves first and ask a

few questions of clarification; or not clarification, information in most cases.

With regard to Salaries - I will not repeat anything. It is anything that I

wanted to ask that did not get asked the total Salaries is $913,600, but of

that $367,400 is for temporary and other positions. Could we just have a

breakdown of what are temporary and other positions within the WPO?

MS MacLELLAN: The temporary positions: we have a research and policy

position that is associated with the violence prevention initiative; we also

have a training officer policy position who leads the violence awareness action

training program; we have another temporary training position which leads the

violence prevention for older adults, which we are doing in partnership with

Health and Community Services; and I believe our fourth one is actually a

director who is in a temporary position at the moment.

MS MICHAEL: Thank you.

So they are very related to the specific short-term programs?

MS MacLELLAN: Yes.

MS MICHAEL: Thank you.

Under Transportation and Communications, the revised was about $60,500 short

of what had been budgeted. I am assuming that that must be related to the fact

that the recruitment of the position for the elder abuse programming was

delayed. Is that the reason for that being under spent by $60,500?

MS DUNDERDALE: Yes, very small of that. In the main it is due to training

and conventions' travel being down as a result of vacancies, the travel costs

to conferences being lower than we anticipated.

MS MICHAEL: Okay, great.

It is a big budget item at $341,000. I guess there are a lot of

transportation costs with regard to the various programs and the training that

is going on around the Province.

MS DUNDERDALE: Yes. We move about 192 people to come to various meetings

and conferences.

MS MICHAEL: Thank you.

Under 06, Purchased Services, could we have a breakdown of what would be the

services that would be Purchased Services?

MS DUNDERDALE: In terms of our notes here we had nineteen professional

service expenditures is that the one?

MS MICHAEL: No, the next one, 06.

MS DUNDERDALE: Sorry.

Advertising in the amount of $75,000, approximately; shredding; room rentals

for meetings, $17,388; work station reviews, $1,100; photo copier charges,

$1,800 - these are estimates now - NLOWE conference sponsorship, $2,000; moving

expenses, $225; tickets for the women's network dinner, $240; and training,

$458. That is all under the administration, under Violence Prevention Initiative

again. It is advertising. Violence Prevention Initiative: our advertising is

$246,873.82; work station reviews, room rentals again, substantial, $22,000;

translations, $3,250; production of DVDs, $2,500; equipment rentals, $6,175;

printing, $5,306; and Aboriginal women's issues, room rentals, $18,135. That

is associated with the conference. The Inuit tribal dance performance was $300.

All of those, approximately, totalled $446,880.

MS MICHAEL: Thank you very much. A very detailed accounting. You do not

always get it as detailed as that. Thanks.

Under the Grants and Subsidies, because it is up by $122,000, am I correct in

assuming that the $100,000 to the Multicultural Women's Organization would

account for the big jump there?

MS DUNDERDALE: Yes, and the increase for the women's centres.

MS MICHAEL: Yes, which is just $5,000 each. That would give you $122,000.

Those are all the line items that I have. There are a couple of general

questions that I would like to address. Well, they are not general, they are

specific, but they are more policy related.

One has to do with the Supportive Living Community Partnership Program, where

HRLE is the lead department I realize, and I know it is not under your budget,

but is WPO a partner in the Supportive Living Community Partnership Program?

MS MacLELLAN: We are certainly involved at the deputy minister's level.

I was invited to attend the first meeting they had with community partners where

they came in to present their needs of those projects that are going to be

considered, so I feel we have a very good working relationship with that team.

MS MICHAEL: Are you permitted to say whether or not the St. John's

Women's Centre is involved as a partner group in this discussion at this

moment? I am thinking about Marguerite's Place. I know they were quite

concerned whether or not Marguerite's Place would fit under this program.

MS DUNDERDALE: They have been in to present.

MS MICHAEL: They do fit in?

MS DUNDERDALE: Well, they have in to present their proposal. I could not

speak to whether or not they are part of the partnership in a formal way but we

do know that they have been in to present.

MS MICHAEL: Right.

MS DUNDERDALE: Yes, and they are getting very serious consideration.

MS MICHAEL: They are getting serious consideration.

Does the Women's Policy Office have to stay unbiased and unprejudiced in

that or can you advocate for them at the table?

MS DUNDERDALE: The committee does its work. The women involved in

Marguerite's Place have certainly made me very familiar. I have met with them,

discussed the project, and we talk about it from time to time. I see these women

on a regular basis. Part of what we are doing too is trying to get a very good

picture of what we are doing around social housing in the Province, because we

have put an awful lot of money in it. Through different organizations, as well

as through Newfoundland and Labrador Housing, we are trying to capture for

ourselves a comprehensive picture of what we are doing in that area, so we have

a better understanding of the investments we are making now and where we need to

go next with it in ensuring that we have a good balance and have a really clear

picture of what it is we are doing.

MS MICHAEL: Minister, when you were outlining, in the beginning, some of

the work of the Women's Policy Office you did make reference to actually a

fair bit of time spent in consultation with departments within government. I

guess I would like to know: Are there any areas which are of specific or special

concern to the Women's Policy Office that you really do make an exerted effort

to get out there and try to share your analysis with different departments?

MS DUNDERDALE: In terms of government, the internal workings?

MS MICHAEL: Yes.

MS DUNDERDALE: Certainly, as Cabinet papers are prepared they come to the

WPO for our analysis, recommendations, commentary, and so on. That is a

significant way in which you influence what is going on in other departments. As

Heather says, she works with deputies and ADMs at that level on a regular basis.

It is certainly a lens that I have on all of the time. As you know, you do not

get to take them off. That happens at the Cabinet table on a regular basis and

it happens at the caucus table. There is a real sensitivity in our government

around these issues. We have made, I feel, considerable advancement on all of

them. We have progressed a number of the principles that guide this work, and we

create awareness amongst my colleagues as well as within the public service.

There still remains a considerable amount of work to be done and we understand

that. Government really is a microcosm of the larger community, so you know the

same challenges we have in the wider community we have in this community as

well, but you know we are making progress.

MS MICHAEL: I am just wondering how proactive can the Women's Policy

Office be. For example, you see an issue that is going on, it is being discussed

in the House of Assembly and it does concern women, but nobody is coming to you

and asking you about it, no department, but this department should really be

thinking about this particular issue. Can you be proactive in doing that kind of

thing?

MS DUNDERDALE: Everyday.

MS MICHAEL: Okay, great.

MS DUNDERDALE: Everybody knows us. We are in everybody's business.

MS MICHAEL: Those are all my questions, Mr. Chair.

CHAIR: Thank you, Ms Michael.

Ms Jones, do you have any further questions?

MS JONES: (Inaudible) was a review of the Human Rights Code being done in

the Province. I am just wondering if the Women's Policy Office made a

submission to that in terms of some possible changes that would affect women.

MS DUNDERDALE: We will review it when it comes to Cabinet, and make our

recommendations there. Where it was done external to government, the Provincial

Advisory Council on the Status of Women made a presentation.

MS JONES: Okay.

I just had another question and that was regarding the victim services. You

mentioned earlier about legal aid and so on, but in a report that the Province

put out last year they were saying that there were nearly 3,500 cases of

referrals to victim services and that there was a wait list, and there still is

a wait list, as we know, for people to receive services. I am just wondering if

you guys have the breakdown on what percentage of those cases would have been

women?

MS DUNDERDALE: We do not have it but we can get it.

MS JONES: Okay.

CHAIR: Any further questions from the committee?

I ask the Clerk to call the subheads.

CLERK: Subhead 2.7.01.

CHAIR: Subhead 2.7.01. Shall that carry?

All those in favour, 'aye'.

SOME HON. MEMBERS: Aye.

CHAIR: All those against, 'nay'.

Carried.

On motion, subhead 2.7.01. carried.

CLERK: 2.7.02.

CHAIR: Subhead 2.7.02. Shall that one carry?

All those in favour, 'aye'.

SOME HON. MEMBERS: Aye.

CHAIR: All those against, 'nay'.

Carried.

On motion, subhead 2.7.02. carried.

CHAIR: Shall the total carry?

All those in favour, 'aye'.

SOME HON. MEMBERS: Aye.

CHAIR: All those against, 'nay'.

Carried.

On motion, total carried.

CHAIR: Shall I report the Estimates for the Women's Policy Office

carried without amendment?

All those in favour, 'aye'.

SOME HON. MEMBERS: Aye.

CHAIR: All those against, 'nay'.

Carried.

On motion, Estimates of the Women's Policy Office carried without

amendment.

CHAIR: Before we move into the Department of Natural Resources Estimates,

you have a copy of the minutes of our meeting that was held on April 2, the

Department of Fisheries and Aquaculture. I would like to have a motion now to

adopt these minutes as circulated.

Moved by Mr. Baker, seconded by Mr. Parsons, that the minutes of the

Department of Fisheries and Aquaculture be adopted as circulated.

All those in favour, 'aye'.

SOME HON. MEMBERS: Aye.

CHAIR: All those against, 'nay'.

Carried.

On motion, minutes of the Department of Fisheries and Aquaculture adopted as

circulated.

CHAIR: Okay, we will begin now with the Estimates for the Department of

Natural Resources. One thing I want to mention as well is that this is being

recorded by Hansard, so if any of the officials have to answer a question, if

you could identify yourself before you speak.

Minister Dunderdale.

MS DUNDERDALE: Thank you again, Mr. Chair.

I am going to begin this piece by introducing all of the people I have left

remaining with me here and there will be some seat changes as we move from

Forestry and Agrifoods Agency into Mines and Energy.

To my immediate left is Len Moores, who is the CEO of the Forestry and

Agrifoods Agency. Then we have Cindy MacDonald, who is the Director of

Agriculture Business Development, and at the end of the row is Keith Deering,

our ADM for Forestry. We also have with us this evening Robert Thompson, who is

my Deputy Minister of Natural Resources; Dick Wardle, ADM of Mines; Charles Bown,

ADM of Energy Policy; Pierre Tobin, Associate Deputy Minister of Energy; Phil

Ivimey, Director of Financial Operations, and Tracey Barron, who is the Director

of Communications for the department.

CHAIR: Thank you, Minister.

Before we begin, I guess I should ask the Clerk to call the first subhead.

CLERK: Subhead 1.1.01.

CHAIR: Subhead 1.1.01. Shall that carry?

Minister Dunderdale.

MS DUNDERDALE: Thank you, Mr. Chair.

I will start by giving a general overview of our main Budget items across the

four branches.

Starting with the forestry sector, you are all aware of the drastic change in

the global marker for forest products and the impact that that has had on the

industry in this Province. Most of these impacts are being felt by individuals

and businesses in the Central and Western regions of the Province. We are

continuing to work with the industry to identify diversification opportunities

and initiatives that will ensure the continued sustainability of the industry.

On Friday past, I announced $500,000 to continue the Residential Wood Pellet

Rebate Program for 2009. The whole idea behind this rebate program is to create

a local market for wood pellets to assist our sawmill industry in utilizing

their residues and improving their financial bottom line. The rebate program is

being funded this year through our Forest Industry Diversification Program

originally announced last year. This is a multi-year program which had an

initial investment of $14 million last year to assist the industry to identify

new markets and develop new value-added products.

We have hired a marketing consultant to assist in developing a

diversification and marketing strategy for the sawmill sector, and our officials

are working closely with sawmillers to develop business plans and achieve

efficiencies. We felt that that was the first step.

The diversification program will provide sawmill operators with capital to

acquire new infrastructure, technology and equipment to support innovation and

modernization of the industry. The fund will lead to product development and the

product and market diversification necessary to lessen dependency on the North

American commodity lumber market. We are currently working with the integrated

sawmillers on a variety of proposals under that fund.

Also, this year we are continuing to invest in infrastructure through the

Resource Roads Program. We are spending an additional $1.6 million for

construction upgrades, new roads and bridge building on former Abitibi limits.

This is important infrastructure spending and the majority of this funding will

be directed to the Central region for potential industry opportunities and

growth. The funding is on top of our regular $4.2 million Capital Roads Program.

We are also spending $10.9 million this year on our silviculture activities,

which is a $200,000 increase over last year.

In agriculture, we are continuing to take a strategic approach to the

development of the industry by investing in areas that will help grow this

sector. These areas include land development, availability of farmland, research

and development, and support for local farmers. Our provincial programming

allows for further expansion and diversification of primary and secondary

sectors and deals with challenges facing the agri-businesses in the Province.

In Budget 2009, we are spending $31.7 million on the agriculture and

agrifoods industry. You will notice this is a $6 million decrease compared with

last year's budget. That is, essentially, as a result of funding that was

allocated last year and not spent in a number of program areas. Remember, the

overall budget last year was increased by $11.2 million. We did not carryover

certain monies from last year based on anticipated uptake for particular

programs. We are being strategic with our funding and not tying up money in

those areas where funding is not being utilized.

A significant investment for us is our share of the new federal-provincial

Growing Forward agreement, valued at nearly $30 million over a five-year period.

Of that amount, we are spending $6.5 million in federal and provincial monies

this year on initiatives that support innovation and competitiveness, enabling

farm businesses to better manage risk and enhance environmental stewardship and

food safety.

We are maintaining our $2 million Provincial Agrifoods Assistant Program and

the $4 million Agriculture and Agrifoods Development Fund geared towards large

scale agriculture expansions. Both programs strive to improve and grow the

economic viability of the agriculture industry and enhance the Province's

competitiveness capacities.

We are investing $2 million this year into the Cranberry Industry Development

Program to provide assistance to applicants involved in the development of

cranberry sites throughout the Province. We are also spending an additional

$300,000 on the Agricultural Land Consolidation Program, for a total budget this

year of $3 million. This funding will provide for construction of agricultural

roads, the acquisition of farmland which is then sold as Crown leases to local

farmers.

Under mines; our mining industry is experiencing a downturn as a result of

the global recession and the past six months have not been kind to us. This has

had the most impact in Labrador West where cutbacks at Wabush Mines,

cancellation of the IOCC expansion, and IOCC's potential summer shutdown have

had a severe effect. This has had an impact on employment, especially in

Labrador West. However, this is expected to be partially offset by the

construction of the Vale Inco Hydromet facility.

In response to this current crisis we feel it is important for us to continue

our support of the mining sector and keep people working and exploring, as well

as to promote our mineral potential. Funding for this year focuses on mineral

exploration and investment attraction and we are spending an additional $620,000

in this year's Budget on exploration, attraction and mineral promotion. We are

making a record investment of $3 million in the provincial Mineral Incentive

Program, an increase of $500,000 over last year. This program provides financial

assistance to our junior mining companies and we will also be restructuring the

program this year to respond to current industry needs.

The Province's mineral promotions plan will also include a continued

emphasis on Labrador to attract interest and potential investment consistent

with our commitment to address the economic and social needs of the people of

Labrador as outlined in our Northern Strategic Plan. The increased funding of

$120,000 will enable us to implement a promotions plan targeted around

attracting investment and increasing awareness around opportunities in the

Province's mining industry.

We have also committed $200,000 to the identification, evaluation and

rehabilitation of the Province's former mine and exploration sites. This

funding will be used to further investigate abandoned mine sites throughout the

Province to determine levels of contamination and potential remediation work,

including the former mine sites at Buchans and Whalesback in Notre Dame Bay. We

are also continuing our investment in the three-year work plan for the

rehabilitation of the Baie Verte and Rambler Mine sites.

Budget 2009 includes a carryover of $4.3 million from last year, in addition

to the just over $3 million allocated for this year. This will complete the

current phase of this project.

Last, but not least, is the energy branch. This year's funding priorities

reflects our approach to long-term strategic planning and provides clear

direction for the development of our resources as laid out in the Energy Plan.

Budget 2009 provides $228 million to Nalcor Energy to assist with its

financing requirements related to the corporations anticipated investments in

Hebron, the White Rose extension, the Lower Churchill development, and other

potential acquisitions. This investment reflects our recent role as equity

partners in the development of our energy resources and provides us with a

competitive advantage in the international energy market as we pursue attractive

energy developments.

Budget 2009 also provides $7.76 million to continue the implementation of key

initiatives outlined in the Energy Plan in the areas of geoscience, energy

efficiency and conservation, and energy innovation. This year's amount

reflects our decision to add a year to the implementation

schedule of the Energy

Plan. We believe this is a much more realistic approach to completing these

major initiatives. The original $35 million commitment to these initiatives

remains. This approach acknowledges the existing Human Resource issues within

Nalcor Energy and the energy branch as a result of the many major projects

currently underway in the energy sector.

I am also very pleased with our investment this year of $1.55 million for the

EnerGuide for Houses Program to assist homeowners with energy audits and making

their homes more energy efficient. Participation in the EnerGuide for Houses

Program will allow homeowners in the Province to become more energy efficient,

reduce cost, encourage energy conservation practices and decrease greenhouse gas

emissions. It also complements retrofits assistance available to homeowners

under the federal retrofit program.

These are just a few highlights of this year's investments under my

department. My staff and I are happy to answer any questions you may have.

CHAIR: Thank you, Minister.

Ms Jones.

MS JONES: Thank you, Minister, for the update and I thank your officials

being available this evening.

I am just going to start with a couple of questions from the Estimates under

section 1.1.01, which would be your office, Minister, in particular. Under

Salaries it says that you are budgeting $329,300. I know it is a little more

than last year. I am assuming it is the wage increase. It is also telling me

that one of the positions in your office is a temporary or other employee being

paid at $47,400.

I am just wondering if you could clarify that for me and tell me what

position it is?

MS DUNDERDALE: In the Minister's Office, $329,300 is in our Estimates

and the increase is because of the extra pay period and the wage increase.

MR. IVIMEY: I do not have that information right now, what temporary

position that is. I believe it currently could just be funding not allocated at

this time, just not allocated to permanent salaries. We can check into that and

I can let you know that information.

MS JONES: Well, it would be allocated because the Estimates last year

shows me that it was spent, so it is being spent somewhere. Right now I

currently have a list of permanent employees which includes, of course, the

minister, the parliamentary secretary salary, the executive assistant, the

secretary to the minister, and the departmental secretary to the minister, but

there is a position that shows temporary being paid at $47,400.

MS DUNDERDALE: We will have to check it for you.

MS JONES: Okay.

The other question would be around Purchased Services. This year there is

$36,600 being allocated and I am wondering if you can tell me what you are

planning to use that money for.

MS DUNDERDALE: Purchased Services: we have budgeted $36,600

MR. IVIMEY: (Inaudible) used for the repairs of office equipment,

advertising expenditures, as well as the purchase of periodicals, newspapers and

official entertainment for the Minister's Office.

MS JONES: It is just that it is $26,000 more than you spent last year, so

I am wondering if you are targeting anything specific. Are you just going to buy

a lot more newspapers this year?

MS DUNDERDALE: We have been using it on the things that it is there for

and we will have to see whether or not we do. I expect the Minister of Finance's

sharp eye will be on it as well and if I do not spend it this year I will not be

getting it next year.

MS JONES: Okay.

Under Executive Support, again under Salaries, last year you did overspend

what you had estimated. You estimated $1.8 million, and you spent $2.4 million,

a little more. I am just wondering what the additional salaries were for.

MS DUNDERDALE: The variance was due to severance and vacation pay owed to

a former deputy minister as well as a critical temporary and contractual

position on commercial advisory and policy positions to work on some of our

future resource developments.

MS JONES: The Estimates are telling me that there was $26,000 in

temporary employees, so that is what it would have been?

MS DUNDERDALE: Yes.

MS JONES: Okay.

Last year as well you spent $30,000 more in Supplies than you had budgeted

for under Executive Support and I am wondering if it was something in

particular. It would be a lot of pens and paper, but it might have been

something specific.

MS DUNDERDALE: Well, my note tells me that it was due to increased

requirement for office supplies associated with increased staffing levels in the

executive office. We have been robbing Peter to pay Paul because we have not had

any incremental raises over the last number of years. I guess last year was

where the rubber hit the road and we needed to do a formal budget allocation.

MS JONES: Okay.

It still seems like an awful lot although the number of employees did

increase. Your budget did go from $11,800 up to over $40,000 in supplies, so it

has actually more than tripled.

Under Purchased Services you had budgeted $11,700, you spent $26,500. Again,

you doubled your expenditure and I am just wondering what that was for.

MS DUNDERDALE: For printing, advertising, promotions, facility of room

rentals, paper shredding services, photocopier rentals, and other miscellaneous

purchased services.

There has been tremendous activity in the office over the last year, as you

can imagine. We have been dealing with a number of major projects and

negotiations, so there has been quite a bit of activity in the office.

MS JONES: But you are not budgeting an increase for this year?

MS DUNDERDALE: No.

MS JONES: Under

section 1.2.02, which would be the Administrative Support

financial operations for the Departments of Natural Resources and Fisheries and

Aquaculture, I am just wondering if someone can explain to me what the crossover

is in Administrative Support.

MR. IVIMEY: The amounts voted there are for the financial operation and

the general operation divisions that would be shared services between the

Department of Natural Resources and Fisheries and Aquaculture. Our Financial

Operations Division as well as our General Operations Division provide support

to both departments, and the amount is voted in our Department of Natural

Resources.

MS JONES: Okay.

Again this year you spent $300,000 less in Salaries than you had budgeted.

Can you tell me if there were some vacancies in that

section and what the

vacancies were?

MR. IVIMEY: Yes, there were several vacancies there in that

section this

year. There was a manager, an organizational budget analyst, an audit officer,

and an accounting clerk position that were vacant throughout the year on

different occasions.

MS JONES: The increase in the line item this year is to cover, I am

assuming, the 8 per cent wage increase and the extra pay period, is it?

MR. IVIMEY: Yes.

MS JONES: Under Purchased Services you budgeted $22,600 and you spent

$63,500. Can you tell me what the purchases were?

MR. IVIMEY: The purchases that were provided there underneath Purchased

Services for the year would have been printing, advertising and promotion,

facility and room rentals, as well as photocopier leases and expenses for

photocopies.

MS JONES: What kind of advertising would that have been? What kind of ads

would it have been?

MR. IVIMEY: Job advertising in various media papers.

MS JONES: Okay.

Were there any specific projects undertaken under this heading?

MR. IVIMEY: No specific projects, where it is the general operations and

the financial operations of the whole division. Any print or media ads that

would go in the paper involving calls for public tender or request for proposals

would also be incurred underneath this subhead.

MS JONES: Under the next section,

section 1.2.03, purchase and

construction and alteration of tangible assets, you spent $35,000 last year on

Professional Services. Obviously it was something that you did not anticipate

because you did not budget for it in the year. Can you tell me what that was

spent on?

MR. IVIMEY: The Revised variance there is due to consulting, design and

engineering expenditures that related to infrastructure projects. All of the

infrastructure funding was originally budgeted in Property, Furnishings and

Equipment and it was reallocated to Professional Services as needed during the

year.

MS JONES: Okay.

What specific project was that?

MR. IVIMEY: There were several infrastructure projects that were budgeted

underneath the subhead for the year. There was construction of an animal health

vehicle garage, buildings in Winterland and Lewisporte, as well as renovations

and construction of a Pynn's Brook veterinarian office. Those Professional

Services expenditures would have related to those infrastructure projects.

MS JONES: What about the Purchased Services? Again, you did not Budget it

but you actually spent it, so it was not anticipated.

MR. IVIMEY: The Purchased Services would also be along the same lines,

various consulting and designing expenditures that were not anticipated and all

the funding was budgeted within the Property, Furnishings and Equipment vote,

and therefore reallocated as needed.

MS JONES: The $2,994,000 that you spend, can you tell me what that was

spent on specifically?

MR. IVIMEY: That was spent on the projects that I just outlined there

earlier. There was the Pynn's Brook vet office, an animal health vehicle

garage, and construction of new forestry buildings in Winterland and Lewisporte.

MS JONES: Okay.

The Budget that you had anticipated, the $3.7 million, you did not spend all

of that. Is there something that did not get done?

MS DUNDERDALE: That was because the bid came in I do not know how many

hundreds of pre cent over and above what was we had, I think, a twenty by

thirty building extension and the bid came in at over $400,000.

MS JONES: Have you re-tendered it for this year?

MS DUNDERDALE: Not at this point in time. We are looking at that. We had

the same issue in Port Hope Simpson and it is a very serious problem for us and

one we have to get our heads wrapped around as to how we manage. The bids are

coming in. They are so far out of alignment it is incredible. You know, it is a

difficult issue for us and we have to find a way to manage it, but a twenty by

thirty extension in Roddickton, $400,000, and a similar experience in Port Hope

Simpson - nobody would ever be able to build a house there if an extension costs

that much.

MS JONES: So you have not decided if you are going to proceed with it or

what you are going to do at this stage?

MS DUNDERDALE: No. We are grappling with how we deal with this serious

issue. We need to have this infrastructure but we have to make sure that we are

not throwing money away, that the investments we are making are good investments

and we are paying fair market value for what it is we are getting. We do not

believe that we are getting fair market value when a twenty by thirty extension,

very basic, a room, nothing complicated, is going to cost us over $400,000.

MS JONES: Well one thing is for certain, that the economic situation has

changed. If tenders were out early you might see a difference in price bidding

this year as opposed to last year.

MS DUNDERDALE: We will see.

MS JONES: The $1.6 million that you are going spend this year, what has

that been targeted for?

MR. IVIMEY: The funding that is targeted for 2009-2010 is for the

replacement and upgrading of forestry and agrifood's vehicles.

MS JONES: How many new vehicles are you buying?

MR. IVIMEY: The exact number of vehicles I am not too sure about at this

time.

MS JONES: What kind of vehicles are they, like trucks or something?

MR. IVIMEY: Yes.

MS DUNDERDALE: What we need to do our regular work for our conservation

officers and road inspections and so on.

MS JONES: Okay.

I guess we can get into the Forest Management part of it now. Before I move

on, I did not know if Lorraine had questions on those two sections or not.

MS MICHAEL: No questions, Mr. Chair. All the questions that I have noted

you asked, so I am all right.

MS JONES: Under Administration and Program Planning, 2.1.01.; under this

particular

section again last year you underspent about $500,000 in Salaries. I

am just wondering what the vacancies were in the department?

MS DUNDERDALE: Some of them were late recruitments and others were

vacancies.

MR. MOORES: They were primarily late recruitment, just going through the

process of vacancies and then recruiting them again, and the time change, the

difference between those times.

MS JONES: Okay. Also in that

section of the department this year you are

going to spend $582,500 on temporary and other employees, a fairly large chunk

of your salary budget. Can you tell me what those positions are for?

MR. MOORES: Seasonal, we have a large seasonal program on in forestry

from fire suppression to silviculture to roadwork to harvesting trials. So it is

a large part of the program. Tree nursery has seasonal employees as well.

MS JONES: Okay. Now I see the silviculture temporary employees are nearly

$2 million, but I guess I am just wondering, in the planning section, what the

positions would actually be, in the Administration and Program Planning section?

MOORES: Yes.

MS JONES: Silviculture is under a different line in my book, so are a

couple of the other ones you just said. So I guess I want a breakdown of what

the $500,000 is for what employees?

MR. MOORES: Yes, I can get you the actual. The general would be for

forest conservation officers who are doing the various types of work that I was

just referring to in terms of field for the different components of our program

under Administration and Program Planning.

MS JONES: Are these workers that are on recall normally hired back every

season?

MR. MOORES: Primarily, they are all on recall, yes.

MS JONES: Okay. This year, of course, you have increased your budget. I

do not know if there are any new positions been added or if this is just the

necessary amount you need to cover off increases and the extra pay period.

MR. MOORES: It is just for covering off the increases. There are no new

positions been added.

MS JONES: Okay.

Under Employee Benefits, last year you budgeted $60,800, you paid out

$280,000. Were there some positions made redundant, some packages issued? Why

would the Employee Benefits have increased so much?

MR. MOORES: Under Employee Benefits, we pay for our work health, safety

and compensation expenditures there. We had three bills related to the year

before, 2007-2008, that was actually paid for in 2008-2009 Budget.

MS JONES: Okay. That is not something that would occur on a regular

basis, is it? When do you have to pay that and why do you have to pay it? You

have to explain to me because I have no idea. You obviously do not have to pay

it this year because you are not budgeting it again.

MR. MOORES: Well, I guess we are hoping to pay it all in (inaudible).

MS JONES: Okay, so it is

MS DUNDERDALE: (Inaudible) three months billing of the former year got

caught in last year's budget. We have to pay it, workplace health and safety

compensation, we have to pay it annually.

MS JONES: Yes, but is it $220,000?

MR. IVIMEY: Those bills were paid late in 2008-2009 due to there was a

vacancy in the Human Resources Division there and there were some bills that

related to the end of the year. Primarily, I think it was January, February and

March that were not processed, unfortunately, until the following fiscal year.

So no, that is not something that would normally occur under general, normal

circumstances.

MS JONES: Okay, because I am looking back through the Estimates here for

2007-2008 and during that year it tells me that you paid $31,000 more in

benefits that year as well. So that would have been 2007-2008. What I am talking

about now is 2008-2009, the year after. You have already overpaid $31,000 in the

previous year, but you are telling me you did not pay, so it got carried over

into 2008-2009. Either I am missing something or I am totally confused all

together. The estimates for your department on that line item are not balancing

out with your statement, your comments.

MR. IVIMEY: The over-expenditures in the year before would have primarily

been attributable to higher additional costs of the Workers' Compensation

bills that were not anticipated. There would not have been any bills related to

prior years during that year.

MS JONES: Okay. So you are saying it would have been related to increases

in the benefit rate. Well, you did not budget for that either, right?

MR. IVIMEY: Yes, correct.

MS JONES: So really, if that was the case you should have budgeted

$90,000 last year as opposed to $60,000. Next year you are still budgeting the

same amount. All of this is due to Workers' Comp. So your department has paid

out $220,000 in additional revenue last year due to that issue but you do not

anticipate paying any money this year.

Under Professional Services, you budgeted $74,000 and you spent $1.5 million

actually, more than $1.5 million. We would like to have a break down of what

that money was spent on.

MS DUNDERDALE: Well, a significant piece of it is legal expenditures

incurred related to Abitibi. They were transferred from justice to us.

As well, under that heading we have the mill diagnostic and marketing

expenditures related to initiatives under the Forestry Industry Diversification

Program. That money was budgeted under grants, but then transferred to this

heading. Also included in that is additional photo

interpretation and forest

mapping professional services contracts that they entered into during the year.

MS JONES: Okay. This year you are budgeting a lot less, of course,

$404,000. It is still more than your estimates from last year but a lot less

than what you actually spent. Can you tell me what that will be used for? Was it

anything in particular?

MR. MOORES: For professional services this coming year. That will

continue to be for some aerial photography purchasing, some site imagery

purchasing, and some wood harvesting modeling as we start to prepare for our

next wood supply analysis.

MS JONES: Okay.

There is another issue I am going to raise with regard to the Estimates for

this department. I have been picking it up as I have been going along. There is

one example here I want to point out. There are lots of them, actually, in the

department where the estimate numbers for 2008-2009 that would have been in last

year's book, that should have showed up as the budgeted amount are different.

For example, Professional Services here is one of those lines. I want to

point it out because I think someone needs to get an explanation for it. Last

year when we did the Estimates for your department, under this line,

Professional Services, you had said that you had indicated there would be

$22,000 budgeted for Professional Services. This year, under 2008-2009 budgeted

line it should have read $22,000, not $74,000.

MS DUNDERDALE: Yes.

MS JONES: That has happened with a lot of lines in this department, but

not only in your department. I picked it up in Health too, when I was doing the

Health Estimates. I am not sure what the reasoning is for it.

MR. IVIMEY: The reasoning behind those number variances would be various

budget restatements that are done from year to year. There were several

restatements that have been done within the department from year to year. That

detailed list I do not have with me right now but some of the restatements would

have been in the admin and program planning subhead that you speak of.

MS JONES: Yes.

MR. IVIMEY: One of them I guess I could speak to right now would be

probably under the Grants and Subsidies, where last year, I think, according to

the budget, it would have been approximately about $14 million and in this years

it only shows $3 million. That is due to the restatement in that there was a new

activity set up which is 2.1.05. Forest Industry Diversification, which is on

page 151 of the Estimates. On that page you can see that there is a 2008-2009

budget there of $11 million. This activity was not in the Estimates for

2008-2009. So it was a new activity set up. That money was restated under the

budget underneath there.

So there are various reasons like that during the year we would do budget

restatements. That is a list that I can provide you of restatements that are

done from budget year to budget year so you can reconcile those figures.

MS JONES: Yes, because it is really confusing.

The other thing I do not know why the Department of Finance would do

their accounting that way because even if it were budgeted and you guys moved it

into another heading or another department, it was still budgeted. That is why

we have a revised column, to revise the difference. Then it is up to us to ask

the questions, I guess, and you to give us the answer as to why it changed. It

becomes very confusing when we go back and compare it to previous years and all

of the numbers are different.

MR. IVIMEY: It is a common practice. It has been done as long as I know

that I have been a Director of Finance and it is done through all government

departments. It is usually done when there are funds moved around like that in

order to provide a comparable year-to-year figure in that or what the money

was actually budgeted for.

In the instance that I speak of, in say the Forestry Industry Diversification

subhead 2.1.05., if we did not do that restatement, the 2008-2009 budget there

would be zero, when, in fact, that would not be correct because there was money

budgeted for Forest Industry Diversification last year, but at that time we did

not have this activity set up. So it is more correct, and correct accounting to

put it in the activity where it belongs so you can see the comparable figures of

where, if the activity was set up, where it should have been budgeted, and if

there were expenditures, those expenditures would also be restated to show up

there as well. Therefore, you can get two comparable years from 2008-2009 as if

the activity existed in 2008-2009 and we spent there, and then you could see

underneath, for next year, what we would budget as well.

MS JONES: Oh, yes. It makes perfect sense when you explain it, but it is

really confusing when you are going through it and you are trying to make all

the numbers come together. It is almost impossible to do.

MS DUNDERDALE: We can certainly give you a listing of it. We had the same

discussion. This is not a new practice. This has been done forever as far as -

MS JONES: Yes, this is the first year I have really picked it up, all the

same, probably because we have so much money in the budget this year. So we have

been all interested in doing the comparisons.

MS MICHAEL: Could I just ask a following question in regard to that?

CHAIR: Ms Michael.

MS JONES: Yeah, sure, go ahead.

MS MICHAEL: Thank you.

I think what would help is if we had a definition of what the revised figure

represents, is that a moment in time is a moment in which revisions are done,

apart from the description of what then happens with the reassignment. Is that

what the revised column is, it is one moment in time. Yes, I think that is what

MS DUNDERDALE: If you introduce new programs and then when you go in the

next year, you have to restate your budget when you start to allocate it out. It

is an accounting practice that has been used in budgets - my understanding is -

for a very long time, but we can certainly give you a list. If you want the

restatements, we can do that that is not a problem.

MS JONES: Well, it would be helpful for us in terms of making everything

come together for us because right now there are a lot of differences in the

numbers and different columns, and without that, we have to go look for it

everywhere else and that makes it kind of difficult as well because we have not

been able to find it in some cases.

Were you finished there, Lorraine?

MS MICHAEL: Yes, I just wanted to (inaudible).

MS JONES: Oh, okay.

Under Purchased Services, last year you budgeted $3,253,000 and you spent

$1.7 million. Do you want to tell me what the difference is, why you did not

spend what you had budgeted? Was there something that did not get done you had

hoped to do?

MS DUNDERDALE: Yes, there were delays, for example, in obtaining our

aerial photography of forest sites, which, in turn, delayed the calling of

tenders for additional

interpretation contracts during the year.

MS JONES: Is that going to go ahead this year, Minister?

MR. MOORES: Yes.

MS JONES: The $2.8 million that you are going to spend this year on

purchased services, what would that include outside of the aerial photography

work that you need to finish?

MR. MOORES: That will include our vehicle rentals, our advertising that

we do throughout the year for forestry promotion, storage space that we have,

and doing our seed collection in the fall.

MS JONES: Of course the Grants and Subsidies you have already touched on

with the transfer of money. That was obviously one of the ones we picked up on,

the $14 million, and then the revised figure of $3,639,000. We will get to the

$11 million portion of that when we get into the other section, but of the $3.6

million that was budgeted for Grants and Subsidies there was only $1.7 million

spent.

Two things: One, could we have a breakdown of what you spent the money on;

and secondly, what were you to spend money on that did not occur?

MR. MOORES: We did a project with the Canadian Council of Forestry

Ministers. We are a corporate member of the Canadian Institute of Forestry. We

spent money for the junior forest wardens. We provided a grant to the

Newfoundland Forest Protection Association, and we provided a grant to the

Newfoundland Lumber Producers Association. Those are our main grants.

MS JONES: How come you did not have a full take-up on the program; nobody

looking for money?

MR. MOORES: Some of that grant money was actually transferred. As Philip

said, some of the money that we had for the Forest Diversification Fund, for the

marketing and the rebate program, was transferred to somewhere else. It was not

a specific grant, so the money gets moved.

MS JONES: Okay.

According to this we are still showing that you have $ 1 million dollars in

grant money that you did not spend last year. He told us that the amount

budgeted that had changed from 2008 was moved to heading 2.1.05, which still

leaves you with the amount that is there, the $3.6 million.

MR. MOORES: That is right.

MS JONES: You only spent $1.7 million. I guess we want to know why you

did not spend the rest of the grant money. Was no one looking for it? Did you

have it earmarked for something that you did not do after?

MR. MOORES: I will try again. When we started, as Philip said, the $14

million was in Grants and Subsidies. You will see in another area of the Budget

there is $11 million there, but we took some of the money there for the mill

diagnostics work, for the marketing fund, and for the rebate money. That was

transferred out of Grants and up into Purchased Services.

MS JONES: Oh, okay. Now I got you, but it still does not make sense to

me. I've got you but it does not make sense to me because you did not spend

all of your budget in Purchased Services either. You only spent half of it or a

little more than half.

MR. MOORES: Professional Services.

MS JONES: Okay, you transferred, then, to Professional Services.

MR. MOORES: Professional Services.

MS JONES: Now I think we might have it right.

The $1.6 million that you have allocated for Grants, what do you intend to

use that for this year; the same groups that you gave grants to last year?

MR. MOORES: Yes, that is correct.

MS JONES: So they are usually standard groups that you would give to on

an annual basis?

MR. MOORES: Yes.

MS JONES: Oh, okay.

Lorraine, do you want me to do the next one and you start with Culture or do

you want to go ahead?

MS MICHAEL: Sure.

CHAIR: Ms Michael.

MS MICHAEL: Thank you.

Before moving on to the next

section - you may have said this. I remember

hearing of at least one federalprovincial partnership that the minister

referred to, but under Revenue, what is that Revenue? Is that just a one-time

program and you did not get all the money that you anticipated getting from the

federal government? This is under 2.1.01, in Federal Revenue.

MS DUNDERDALE: That is our community trust money, and that has been now

budgeted under Forest Industry Diversification.

MS MICHAEL: What did you say that time, Minister?

MS DUNDERDALE: The community trust money is the federal government

funding and it was put there for the manufacturing sector.

MS MICHAEL: Right. And that funding has ended?

MS DUNDERDALE: No. We have a pot of $24 million that was made available

under that program. There was $4 million of it that was assigned over the life

of the forestry restructuring and diversification program and so that much of it

has been allocated and moved to another sector, moved to another heading, the

Forest Industry Diversification Program.

MS MICHAEL: Thank you. I just did not hear you the first time.

We can move on to 2.1.02, Operations and Implementation. Here, of course, we

are getting into district forestry and wildlife offices. Some of these questions

always seem repetitive, I know, but we do have to ask.

Under Salaries there was a slight over expenditure, almost $100,000 in the

revised figure, and the new figure for the estimate for this year is up over $1

million. Could we have an explanation? Are there new positions happening here or

what is it that is going on?

MS DUNDERDALE: The variance from the budget to the revised was due to

higher than anticipated overtime and some other earning expenditures associated

with the regional forestry operations. The increase in the budget this year is

due to the 4 per cent raise that we had to budget for this year as well as the

extra pay period.

MS MICHAEL: Thank you.

Under Transportation and Communications, 03, you under spent last year, but

it looks like you still anticipate over $1 million. You have kept the same line.

What was the under expenditure, just less travel than planned?

MS DUNDERDALE: Less travel and we anticipate more travel in the upcoming

year because we are doing more training. We have required training for our

conservation officers and employees and that is scheduled for the upcoming year.

MS MICHAEL: Thank you.

Under Supplies, I have no idea what supplies means here so you will have to

fill me in on that, but there was an over expenditure of $539,700.

MS DUNDERDALE: The cost of fuel for our trucks and all of our vehicles,

as well as additional costs of outfitting new and replacement vehicles purchased

during the year, with tires, winches, light bars, racks and other things like

that that we need for our operations.

MS MICHAEL: The over expenditure, one of the big reasons was the increase

in the cost of fuel?

MS DUNDERDALE: Yes.

MS MICHAEL: Okay.

Under Purchased Services, again there is an over expenditure of $323,500. It

looks like that was a one time thing, but what was that?

MS DUNDERDALE: Higher expenditures associated with vehicle repairs and

maintenance. Some of our fleet is getting old which is why we are going to

replace some of them this year.

MS MICHAEL: Right.

Property, Furnishings and Equipment: Do some of the new vehicles come in

under that?

MS DUNDERDALE: Yes.

MS MICHAEL: Yes.

MS DUNDERDALE: As well as some furnishings and equipment we need for

program delivery.

MS MICHAEL: Thank you.

I always find these curious so I always ask: What is the Provincial Revenue,

$3,500? What would make that?

MR. IVIMEY: That Provincial Revenue would not be anything specific. It is

just unallocated, just general miscellaneous revenue that might come in through

the year in terms of, we might get a reimbursement from a vender or supplier for

a product that we purchased or something like that. It is not budgeted per se.

MS MICHAEL: Thank you.

The next

section then, 2.1.03, Silviculture Development: Again, looking at

Salaries, there was an under expenditure for $126,000, but the estimate for this

year is $212,700 over what was budgeted last year. Are there any new positions

involved there or is all of that

MS DUNDERDALE: The variance is due, in terms of the Revised Budget for

2008-2009, we had less than anticipated salary costs with the silviculturists

and that varies from year to year depending on the scope of the program. The

increase in Salaries again is to do with the 4 per cent and the twenty-seven pay

periods.

MS MICHAEL: Right. Of course, the nature of the silviculture would be

such that it would explain the high amount of temporary and other employees

because that would be the summer program.

MS DUNDERDALE: Absolutely. It is a seasonal job.

MS MICHAEL: Thank you very much.

Supplies, 04: Again there was a major over expenditure there of $307,000. Was

that something unanticipated?

MS DUNDERDALE: The revised variance was due to an internal reallocation

of funds within the silviculture program. Allocation of the silviculture budget

is done early in the fiscal year, and at that time a number of projects had been

certified to proceed. Some are on hold and some are under analysis. Some of the

projects proceed while others do not, and new projects are added during the year

when tendered projects come in at under our estimated costs. Therefore we

reallocate funds under that heading to Purchased Services where the public

tender contracts for silviculture projects are budgeted, to transportation and

communication and supplies to allow for the department to proceed with the

silviculture work. We try to manage the funds within that, depending on the

scope of work that needs to get done.

MS MICHAEL: Thank you.

Under Purchased Services, 06, you were slightly under budget, $272,500.

MS DUNDERDALE: For all of the same reasons.

MS MICHAEL: The same reasons, okay. That is all from that.

Would the Provincial Revenue have the same explanation here? It is a bit more

this time, it is $9,200.

MR. IVIMEY: The Provincial Revenue budgeted underneath the silviculture

development is for the sale of tree seedlings. The higher amount there this year

is just due to a slightly larger amount of tree seedlings sold during the year.

MS MICHAEL: Thank you.

Moving down, then, into Capital, the Resource Roads Construction: The major

one for me would be 06, Purchased Services. There was a variance from the budget

to the revised, a variance downward, but the budget for this year, the estimate,

is $1.6 million more than last year.

MS DUNDERDALE: Abitibi.

MS MICHAEL: Oh, okay.

MS DUNDERDALE: That is for construction and maintenance of roads on their

former limits.

MS MICHAEL: Okay.

We will do one more, 2.1.05., the Forest Industry Diversification. The Loans,

Advances and Investments, can you tell us a bit about that, Minister, because it

looks like you had $11 million budgeted but that money was not used at all?

MR. DEERING: The amount of money that was budgeted last year under the

Forest Industry Diversification Fund was allocated to the projects that the

minister described in her opening remarks, projects that we were going to fund

to promote the diversification and competitiveness of the integrated sawmill

sector. It was a new program for us this year and it took us some time to get

the program established. We had to set up a committee and set up guidelines and

criteria to evaluate proposals, and as well, give the proponents opportunities

to develop business plans to get projects in to us for evaluation. It is a three

year program. We do have some business plans on the table now for which the

committee has evaluated and are soon ready to move forward on projects.

MS MICHAEL: So I assume the $11 million was just carried over with $2.5

million added to it.

MR. DEERING: Correct.

MS MICHAEL: Right, and this program is the one that is cost-shared with

the federal, obviously, because you have the federal component there.

MS DUNDERDALE: Only in the Community Trust Program provides part of the

funding for this program.

MS MICHAEL: Okay, this is the Community Trust part.

MS DUNDERDALE: This is the $14 million, three-year program.

MS MICHAEL: Right.

MS DUNDERDALE: The first year of the three-year program, but because it

is a new program there is an awful lot of work that is required once you get

approval through the budget process to go ahead. So a whole process, an

application process and a regulatory process has to be set up. When a program is

announced it takes some time to get it up and running and for people to

understand what is required of them, to prepare their applications, to get them

in, to get them considered. So we are not surprised that we did not have a big

uptake in the first year. That is fairly normal when you are introducing

something new but we are happy with we have significant challenges that I am

sure we will talk about before the night is done in terms of the forestry

sector, but in terms of some of the things that we are trying to do here, we

have a number of applications, as Keith has said, before us and well progressed.

So we will soon be able to start to approve some of the projects that have been

submitted.

MS MICHAEL: Okay. I do not know, do you want to yes, I thought so.

MS JONES: I have questions on that program as well. Now, all the money

that is in that program is for loans or investment projects. There is nothing in

that for grants at all is there? Is there a cap on what you can receive?

MR. DEERING: The funding criteria require a minimum of 20 per cent

investment by the proponent. Of course, we have to distribute our fund as best

as we can across the Province and amongst the operators that we still have

remaining in the Province.

MS JONES: What kind of projects would fit the criteria? What is it you

are looking for in particular?

MR. DEERING: Prior to the commencement of the program itself we had set

up a set of criteria and guidelines for the operators to structure their

business plans around. We had required that each of the proponents undertake a

technical diagnostic of their integrated operations, and we had contracted

Forintek out of Quebec to do that for us. As well, the proponents were required

to undertake a financial diagnostic, for which we had to engage the Department

of Innovation, Trade and Rural Development to do that work for us.

Some of the projects that we anticipate funding are mill upgrades that came

as a result of the technical diagnostics, which would include components to

improve energy efficiency, components to improve mill productivity, increase

lumber yields, and things of that nature, as well as projects that would be

brand new, including bio-energy development. In this particular case, wood

pellet plant to displace fibre that normally would have been shipped and

processed as pulpwood in the past. So we are looking to diversify the products

that we are producing, or had been producing up to this point, to make the

industry more competitive.

MS JONES: Are you getting many applications?

MR. DEERING: Well up to this point, as I said, we had limited the program

in the first year to the integrated sawmill operators. We had approximately

eleven integrated sawmill operators as early as four years ago. We currently

have four integrated sawmills that are continuing to operate in this Province.

At this point we are inviting proposals and business plans from those operators.

As I said earlier on, the anticipated length of this program is up to three

years and if funding still exists after the projects that these people have

undertaken have been completed, then we will expand the program into some of the

larger non-integrated mills.

MS JONES: That is all I had.

MS MICHAEL : (Inaudible) 2.2.01. which is Insect Control,

"Appropriations provide for the Province's insect and disease surveys as

well as control programs which are cost shared with the Province's pulp and

paper companies" Unfortunately, I think now we are saying company. There

will be only one company now involved in this, "depending on insect

location and timber ownership."

The first one, 03.Transportation and Communications, the revision from the

budget was $318,400. Was that a one-time expense or was it unexpected expense?

MR. DEERING: (Inaudible) budget year, it was an unanticipated expense

because of the significant outbreak of hemlock looper that we had in Labrador.

MS MICHAEL: Oh, right.

MR. DEERING: We undertook a significant program in Labrador this past

year and we do expect to continue with a looper spray program in Labrador again

this year.

MS MICHAEL: Okay. You have gone back to the budget for last year, the

same estimate. You think you will not need any more than that?

MR. DEERING: It will be a prioritization exercise for us for this year

and we anticipate if we do undertake an expanded program in Labrador there will

be a reduced program on the Island portion of the Province.

MS MICHAEL: Okay, thank you.

Under Professional Services, you budgeted last year and did not spend

anything and you are budgeting again this year. Is it normal to keep so much in

a line like Professional Services, or was there a reason you did not spend

anything last year?

MS DUNDERDALE: (Inaudible) the variance. We did not spend anything

because we did not contract outside consults for various insect control related

studies but we do expect to do that this year.

MS MICHAEL: Okay.

MS DUNDERDALE: In terms of that heading, there are some programs that we

share with the pulp and paper company now, we did share with the pulp and paper

companies, but we also do an insect control program that is entirely within the

purview of the department.

MS MICHAEL: Right.

MS DUNDERDALE: Like in Labrador, for example.

MS MICHAEL: Okay, thank you.

Under Purchased Services, there was not a big overspending, about $50,000.

Again, was that a one-time expense?

MS DUNDERDALE: Again, that was to do with the outbreak we had of the

hemlock looper in Labrador.

MS MICHAEL: Okay. All of those were related.

Do you want to start asking, Yvonne?

MS JONES: Actually, on the last

section you said that there were eleven

integrated sawmills now there are only four. Can you give us the list of

sawmills and the seven that have closed down? If you do not have it right now

you can send it to us.

MR. DEERING: I will send it to you.

MS JONES: We would like to get it a bit earlier because information we

asked for last year, we only got a couple of weeks ago from last year's

Estimates. So it was kind of outdated for us at that stage.

MS DUNDERDALE: (Inaudible) everything that we asked for in Estimates when

you were in government, we did not get any. So at least we have moved it up.

MS JONES: Oh, did you?

MS DUNDERDALE: We have speeded it up somewhat.

MS JONES: I guess it was an improvement. Anyway, it was a real great one.

If we could get the list it would be helpful for us because I am not even

sure what mills it was. I know that there recently we did get a call from a mill

operator who was, at the time, looking for money from the department. I think

they were looking for some kind of funding to offset the cost of their

operations, emergency assistance or something like that. They did come to us and

they had about forty employees, and we did find out after that they did close up

and go out of business.

MS DUNDERDALE: Yes, and I am familiar with that company.

We were aware of those situations when we developed our forestry

restructuring and diversification program. It is one of the reasons that we

brought in mill diagnostics, because we wanted to work with the industry and we

wanted to make significant investment in the industry and we were going forward

in the budget to make the request under this program. We also wanted to ensure

that because the program that we have brought forward is a multidimensional one,

it talks about the business we are doing in this Province with pulpwood, but

also what we are doing with sawlogs and the need to encourage and support

secondary processing and to develop markets outside of the United States.

One of the critical pieces of that was to help companies make sure that they

were in the best possible position in their businesses to go forward and be

successful with the support of the programs, such as the ones that we were

introducing. We said to them quite clearly at the time, we are not interested in

paying your light bill. We need to go in and have a look at your business

overall to see that you have the right equipment that you need to do your

business, that you have a sound business plan and we are going to make monies

available to you. If you are in a good place and you have a reasonable chance of

success, we can provide money so that you can get the equipment you require to

further your business, to assist you to have a lean and efficient operation and

to help you do good, sound business planning. We will also work with you in

identifying markets and working with you, not only in identifying the markets,

but co-operating with you and supporting you until you can actually realize

contracts and get ready for export development.

So we looked at all of those initiatives. When the program was announced it

was very well received by the industry, but we have significant challenges in

the forestry industry here as we do across the country and across the world. The

situation has become exacerbated by the fact that AbitibiBowater has closed

down. Unless there is a market for pulpwood, we have a serious issue about what

we do about sawlogs. That is an issue that has not been resolved.

Hopefully, in our call for Expression of Interest we will have we are

hoping that in that process we will be able to identify a company that can come

forward with some kind of plan for the use of pulpwood in the Province because

without it we have significant challenges for the industry, and particularly in

Central Newfoundland and Labrador.

MS JONES: Under Bill 65, when we passed that in the House of Assembly, I

guess at the time we did not anticipate the kind of fallout that we are getting

now. We are getting a lot of feedback right now, and I guess a lot of it is

coming from the operators that had allocations and did not have equipment. I

thought under the legislation there was a provision whereby people could appeal

for an exemption, I guess, to the minister or to the department or whatever. I

am just wondering if there were any appeals for exemptions and if any were

granted under that legislation in the last little while?

MS DUNDERDALE: The whole purpose of Bill 65 was to take the middle person

out of the industry here in the Province. You are well aware - even though

permits were only issued annually, once the first one was issued it was

extraordinarily difficult not to continue to issue it.

Over the years we had a number of people who did not harvest wood, who were

not associated anymore with the forestry industry at all, holding permits,

getting them for a few dollars year over year and selling them to people,

businesses that were involved in the industry, adding significantly to their

costs and really affecting in a negative way their ability to succeed. In fact,

we had a number of people who went out of business because they did not have

access to the fibre supply here in the Province, while the people who did have

the fibre supply were retired or working in Fort McMurray or so on.

That kind of a practice in the fishery was called slipper skipper and we use

the same term in terms of the forestry piece. We needed to take those people out

of the industry and to make the industry more competitive and give the people

who were legitimately involved in working in that area and hiring people and

running businesses in that area a reasonable chance of success and a reasonable

chance to assess to the natural resources.

It is essentially the same thing we said to Abitibi: If you are not going to

be here and operate here then you are not going to get access to the fibre here.

That is what we were saying to the other people: If you did not have the ability

to harvest or to manufacture or have a sawmill that uses the lumber coming from

a permit, then we were not going to issue you the permit anymore.

Now, there have been a number of circumstances where people - in terms of the

integrated sawmillers, there was at least one of them, that I am sure you are

familiar with because I think you have referred to it at least once or twice,

who because of the circumstances in terms of his ability to provide pulpwood to

Abitibi was certainly impaired. The markets really impacted him negatively and

he found himself in a position where he really could not operate his business

anymore. He closed his operation down, even though he did participate in the

mill diagnostics and so on, because he is hopeful that he may come back into the

industry. He found himself out West earning a living for himself and his family

and that was fair enough.

He appealed to the ministry and what we did was, we gave a timeline that, if

you come back to Newfoundland and you are going to restart your business and you

are going to be legitimately involved in this industry, then your wood supply

will be here for you, but you are not going to have the wood supply while you

are in Alberta. We are going to use it for the businesses who are here and

operational during that time. But I make a commitment to you, that if you come

back within two years then your wood supply is going to be available to you. We

would not see your operation closed down that way.

There are a number of other people who have applied to me to say that they

would like to appeal on the grounds that they had illnesses and so on, and we

are taking all of that into consideration. We are not in the business of putting

people who legitimately earned a living and were legitimately involved in this

business out of the business. What we are trying to do is stop the practice of

added costs and expenses to people who are legitimately involved in the industry

by people who have no more than a financial industry, are not active in the

industry themselves other than in that particular way.

MS JONES: So there is really only one exemption then that has been given,

is that what you are telling me?

MS DUNDERDALE: I do not know. We have not given any exemptions. We have

held the supply for that case and we have asked for some additional information

from the other two cases, I think it is, but we have not issued the permit. I

need a doctor's certificate and so on or a note from the doctor to confirm the

facts.

MR. MOORES: For that sawmiller, in particular, we have not issued the

permit, but if he can get his sawmill up and running we would be prepared to

issue it.

MS DUNDERDALE: That is right. As I said, even though the mill was not

operational, which was one of the requirements of the program to avail of the

mill diagnostics, we did the mill diagnostics with him anyway. Any proposal that

he made to us for funding would be given very serious consideration.

We have been around the business a long time and we know the people who are

legitimately involved in this and we are certainly aware of the challenges that

they have had to deal with over the last number of years. It certainly was not

the intention of Bill 65 to put more onerous responsibilities on them or

challenges to them. Those are not the people we were trying to deal with. We are

trying to accommodate them as best we can, while staying true to the intent of

the bill.

MS JONES: On the Abitibi lands, I understand that government had to issue

new permits to those who wanted to cut firewood. Did that ever get done or is

there some reason why it has not been done?

MS DUNDERDALE: No. What we did was we worked very hard at keeping people

(inaudible) so we would not have a big disruption in everything else that went

on. Our permits run until December, and what we did was said: Those same permits

will serve you now, so everyone who has permits can keep them and you apply in

the normal run of business.

MS JONES: So there is not going to be any issue there where there is some

dispute with the lands between government and the company and so on? That will

not interfere with this in any way?

MS DUNDERDALE: No.

MS JONES: Before we move on, I just had a couple of more questions with

regard to the forestry piece of it. You have recently called for an Expression

of Interest in Central Newfoundland on the timber resources that were there and

I understand that there were several criteria that people had to meet and so on,

and you can certainly give us an update on that if you want.

There was some concern expressed to us, because what we were told was that

under

section 13(4) of the act government had to deal with a comprehensive

consultation process before they could tender this land or issue any new

licenses. We have been getting some calls from people saying that they were not

aware or they are not aware that there was any kind of consultation held. I do

not know if there is going to be one or if there is one scheduled. What is

happening with that?

MS DUNDERDALE: Part of the issue is going to be, we need to know what the

proposals are for the land. It is hard to have a consultation when you do not

have any proposals before you. Yes, we will certainly do the consultation.

Basically we had a significant interest in the lands out there. Significant

people wanted a piece of the land for different reasons; access to the fibre. We

need to do this in a comprehensive way.

As I said earlier, we still have significant challenges in the forestry

industry, and given the fact that there is not now a market for pulpwood in

Central makes for significant challenges for us in the whole sector. We need to

advertise far and wide so that we have a variety of interest. We hope, in that

fibre, to make a proposal under the Expression of Interest.

We need to find a purpose for the pulpwood because if we do not find a

purpose for the pulpwood we are very restricted in terms of what we can do with

the saw logs. That is a very important consideration as we move forward. We just

cannot go in and cut thousands of cords of pulpwood and lay it to one side to

rot while we take out the saw logs. We have a significant challenge before us

and we felt that the most comprehensive way to address that was to give

everybody fair access to the fibre and also to ensure that we did significant

work around attracting larger interests that might have a purpose for the

pulpwood to that area of the Province.

MS JONES: The reason that we ask is because our

interpretation of it

under that

section of the act is that the consultation was to occur before there

was a tender of any other practice or usage of the land. I will go back and

check the act again

MS DUNDERDALE: But we are not issuing a tender. We have asked for

Expressions of Interest. We are not issuing tenders.

MS JONES: Well, you are still going to use the land, so call it whatever

you like.

MS DUNDERDALE: Yes, but we have time. When we get the Expressions of

Interest and we are able to understand what the interest is in the use of that

fibre, and what is before us, then we can do the consultation process, making

that information available to people in the Province who want to engage in that

consultation, so it is informed and people know what the possibilities are or

are not. There is a big difference between doing an Expression of Interest and

actually awarding access to fibre.

MR. MOORES: Maybe I can clarify. Under that section, our understanding

is, if you are going to award or enter into a new timber licence with someone,

there is a requirement for public consultation.

We have done the Expression of Interest to see what interests are out there

to use the resource, because there are some companies who may not want a timber

licence. They might just want to keep the resource and have access to it through

the Crown, and to be prepared to go out and purchase wood from Crown operators.

We are waiting to see what the interest is from the Expression of Interest,

and see what kind of security they want for the fibre resource. Hypothetically,

if at the end of the day there is someone who wants a secure fibre resource for

a possible facility, there will have to be public consultations as per the act,

if government decides that they might want to enter into a timber licence with a

particular operator.

MS JONES: From our perspective, we have not raised a number of these

issues in the House, but I am going to raise them tonight. A lot of it is coming

from environmentalists and outfitters. I will be honest with you. There have

been a number of complaints regarding any number of districts across the

Province, and I will get into two or three examples shortly. They have to deal

with the concerns that they are expressing around the forest management plans,

and the fact that they feel, and they legitimately feel - the most recent group

that we have had discussions with is the Atlantic Salmon Federation. Recently

the outfitters' associations just met on the West Coast over the weekend. We

have been getting concerns, I guess, from them that they have withdrawn even, in

some cases, from the processes, because they feel that their concerns are not

being taken seriously and their issues are not being addressed appropriately. I

would just like to give you the opportunity to explain what the involvement of

these groups has been.

One of the most recent ones was with regard to Districts 14 and 15 on the

West Coast. There was a very strong feeling that the Minister of Environment had

rubber-stamped that entire allocation or management plan. I believe it was a

five-year management plan. I am trying to recall now. They certainly felt that

there was not a lot of consideration taken for the environmental aspects and the

concerns that they had raised. They felt like they did not have an opportunity

to raise their concerns appropriately.

When this is being done, is there specific consideration being given to the

ecological perspectives and environmental perspectives that people are having

and is there appropriate open consultation, like in this case for example in

District 14 and 15?

MS DUNDERDALE: Absolutely!

If I recall correctly, the federation did not make a presentation. We did the

whole consultation process and they did not bother to come and make a

presentation. It is one of the challenges that we have to face in the department

all the time. Having access now to the Abitibi fibre underlines it even more in

lots of ways. There are many, many people in this Province who do not think we

should cut another log. They see forestry as a twilight industry, an industry of

the past. The Prime Minister, in fact, has made the same statements. Under

whatever circumstance you go to cut down timber, you will have protesters.

We have had offers to buy up the Abitibi limits so that people cannot cut

wood on it. The forest should only be used for outfitters or it should only be

used for view scapes and tourism, any number of proposals that come before us.

To say that the Department of Natural Resources or the Department of

Environment and Conservation does not take these issues seriously, I will tell

you that we have forestry practically shut down on the Avalon Peninsula because

of eriderma lichen, and significant numbers of people put out of work as a

result of that. There was one company with over forty people who were put out of

work because they do not have access here and that is without knowing very much

about the lichen. When the lichen was first discovered, we designated an area on

the Avalon, Halls Gullies, to protect the thalli. We did not allow any forestry

activities to take place there at all. All the lichen died, but it certainly did

not have anything to do with forestry and we do not have any information on why

they died. Nevertheless, we have spent hundreds and hundreds of hours working

with the industry and working with the Department of Environment and

Conservation to try and resolve these significant issues. None of us want to be

responsible for harming the environment. I certainly do not want to be

responsible in any kind of a way for destroying a species that only exists here

in Newfoundland and Labrador.

I can give you example after example of significant measures that we have

taken that have been detrimental to the industry to protect what is considered

to be endangered flora and fauna. In terms of the fauna piece, what we have done

in terms of the pine marten in Western Newfoundland has caused pulp and paper

companies millions and millions of dollars. We have moved people away from

viewscapes, we have moved them away from watersheds. Every time you drive one of

these companies back further into the country, we add millions of dollars onto

their bottom line in an industry that is significantly challenged and has been

for some time, and hundreds and hundreds, if not thousands of people, in this

Province rely on them for their livelihood.

It is always a question of finding the balance. For me, I do not believe that

forestry is a twilight industry. I think we are going through a rough patch,

there is no doubt about that, and we have to be innovative and we have to be

smarter about how we are doing things. We have to stop being so insular and look

at the world and the markets in the world and how we might be able to access

them. We always have to be sustainable and we have to be very careful of what we

are doing in the environment. All of these things are taken into consideration.

To suggest that we do not take them into consideration, I mean, we can provide

you example after example where we do.

These whole planning processes, not only that we do as a department, but, for

example, that companies do, provide the opportunity for whoever is interested to

engage. People have now decided to assign a motive to the people who do not

participate. It is because they are frustrated and not happy with the process.

There is no evidence to support that. They could be completely satisfied with

the process.

I know that we take very seriously any suggestion or recommendation. I can

give you examples in terms of our planning on the Northern Peninsula, where

communities made representation to it and significant adjustments were made to

our harvesting plan as a result. It happens all of the time, on a daily basis.

For somebody to complain about the consultation process and be writing letters

to the minister with concerns and so on, and they did not participate in the

consultation, it is hard for me to give much creditability to that criticism.

MS JONES: After all of that, maybe you can tell me what the consultation

process was for Districts 14 and 15, because we are being told that during the

planning process, before this went to an environmental assessment, there was no

public consultation or at least these individuals were not engaged in it. We

have had letters and phone calls from people in that area.

MR. DEERING: The plans for Districts 14 and 15 are the second or third

iteration, I believe, of forest management plans for those particular districts.

We have been undertaking strategic and operational plans for the last fifteen

years or so and we have had a vast range of people involved in the process in

that time.

Typically, the way our process starts out is we write a twenty-year strategic

plan for the department, we undertake a public consultation exercise that is

advertised in every medium that we can throughout the districts that are

involved, we send public notices to community councils, and we ensure that

regulatory agencies including the Department of Fisheries and Oceans, the

federal Department of Environment, the Canadian Wildlife Service, any

stakeholder that we know has an interest in our planning process in various

other districts, we send them specific invitations in addition to the outreach

that we do through the public at large. Anybody who has an interest in being

involved in the process, we make sure they have amply opportunity to do so.

I would add that our plans are written and based on the best available

science. We engage the expertise of wildlife biologists and habitat biologists

from DFO who provide us with the guidelines and recommendations for forestry

operations as it relates to fish habitat and wildlife habitat, and those things

are implemented.

As the minister has already pointed out, our land-based net down starts with

an alienation of areas that are of special interest to people and to animals and

things like that. After we do our net down process whatever is left over is what

our available wood supply is. Again, we write plans, the pulp and paper company

writes plans, and all told we have a significant number of plans that we write

on an annual basis.

MS JONES: You mentioned the Great Northern Peninsula and that is another

area where we have been getting complaints, actually, from Districts 17 and 18,

I think it is. What they have been telling us is that under the environmental

assessment process all forestry activity is supposed to be suspended in a

certain area until the natural area systems study or whatever is completed. They

are telling us that the activity was not suspended for the two-year period, and

that in one

section called The Tickles - and I know nothing about the area up

there so I am just going on the local input that I have been given - that there

is still cutting ongoing in that area and forest activity. They have expressed

concerns to us because they are saying this was part of the process, this was

part of the undertaking, and this was what was agreed to but it is not being

followed. I do not know if you can clarify what is going on there for us or not.

MR. DEERING: My understanding of the circumstance in The Tickles in

particular - The Tickles area is on the periphery of one of the areas in the

natural area systems plan, but we did agree through the Minister of Environment's

release of the plan that we would suspend harvesting activities in The Tickles

area. To my knowledge there are no commercial harvesting activities taking place

in that particular area. There was a road constructed to the area in the year

previous, but at this point we have not allocated any commercial operators to

that particular plot until the consultation process for this particular area is

completed, as per the Minister of Environment's direction.

MS JONES: So you are telling me that there is no cutting going on there

now? Because I am just checking with my staff to see when the last call was that

we received on this issue, and it was a little over a month ago.

MR. DEERING: In the area that was under question, and again as per the

Department of Environment's release, we have not allocated any commercial

operators to that particular area. Again, we have constructed a road. The road

was constructed prior to the release of the plan

MS JONES: Yes, we are aware of that.

MR. DEERING: - but we have not allocated operators to harvest wood

from that piece of road.

MS JONES: When we passed the sustainability act in the House of Assembly,

I thought that act would really be there to help resolve issues like that, to

bring all the partners together and to ensure that there wasn't a problem. In

the act I thought there was also a

section in which there was a conflict

resolution committee that was going to be established to actually do this. I do

not know if that committee was ever established. I think the act was passed in

MS DUNDERDALE: In terms of some of the contacts that I have had, I do not

know that there is a conflict resolution process available to us that is going

to reconcile some of the difficulties we have and the polarized positions. There

are people in this Province who do not feel that we should be cutting, period.

Now I do not know how you reconcile that.

MS JONES: Well, that is not the issue that we are raising. In fact, the

people who I have talked to have no problem with development within the woods

industry. They have concerns that their voices may not be heard, their issues

may not be addressed appropriately, and it is only appropriate that the

department answer for that.

MS DUNDERDALE: Issues are heard, but again it is a question of balance.

It depends on the arguments that are being put forward. For example, on the

Avalon Peninsula the environmentalists who have made the issues around the

Erioderma lichen, their issue has been the one that people have agreed to. They

have made an argument strong enough, that at this point we have suspended woods

operations on the Avalon. In other areas sometimes it is the harvesters who will

win the argument at the end of the day, because, again, it has to be balanced

about; what values are we trying to protect. That is extremely important in

terms of the environment and conservation side, but there are also values on the

economic side and on the forestry side that we have to balance that out with,

and whether we can have a pulp and paper industry operating in Corner Brook, for

example, if we are going to limit everywhere they can cut and we are going to

escalate their costs of accessing fibre to such a degree that the industry has

to shut down. That truly is a serious consideration.

There is always a question of balance and that is what I have to work at with

my colleague in the Department of Environment and Conservation. If somebody says

to me, Corner Brook Pulp and Paper should not be able to cut on the side of a

hill so people can see it from the highway, that is all fine and dandy. We have

had that circumstance and I have said to Corner Brook Pulp and Paper: Move back.

You have to move out of the view plain. The minute I did that I added a million

dollars to their operations for that year. Now, how many millions of dollars do

I add before I have a company saying, I cannot operate here any more, and I have

1,500 people or 2,000 people out of work in Western Newfoundland? That is the

balance.

MS JONES: But that is all part of the planning process.

MS DUNDERDALE: It is part of the planning process, but I cannot protect

everything and the Minister of Environment and Conservation cannot protect

everything, so we have to find the balance and it is a difficult thing to do.

MS JONES: My next question is on District 2, and that is the five-year

forestry operating plan. When you released that plan and I have to quote

here you said: The annual operating plan that was submitted to government

must describe how issues raised by the public and government agencies in this

environmental assessment review will be addressed. You asked that they submit an

annual progress report to the department outlining the outcomes of these

measures and how they followed up on that.

Were these reports ever received, are they being received, and are the issues

being addressed from an environmental perspective that were raised during the

assessment?

MR. DEERING: The release and the provisions that you just described came

from the Minister of Environment?

MS JONES: Yes. The proponent was your department. The Minister of

Environment set the conditions.

MR. DEERING: Correct, and these would have been conditions that the

Minister of Environment provided to us. In our annual operating plan process for

which we have to write a AOP, an annual operating plan, for every single forest

management district in the Province that has commercial activities, this is

where these provisions and operations are described, and these are submitted to

the Department of Environment on an annual basis.

MS JONES: How are they made available to the public? Do you know?

MR. DEERING: Most of our districts have websites where the stakeholders

can access information related to the forest management planning process, and a

lot of the districts have posted these annual operating plans on those district

planning websites.

MS JONES: Okay.

I just have one other question under the forestry

section and it comes out of

the comments in the Auditor General's report. It was regarding conservation

officers and their seizure practices with regard to property, how they managed

it, tracked it, protected it, whatever they did. I guess the question would be:

how did government fix this problem? Do you now have a database in place for the

administration of seized properties? Is it all accounted for or not?

The other issue was to deal with the moose meat that was being donated to

charitable events and so on. There were some issues raised around that and how

that was tracked was it moose meat?

OFFICIAL: It was any kind of game (inaudible) people donated that to

charities.

MS JONES: Yes, any kind of game. Wherever the seized meat would go and

how that was tracked.

MS DUNDERDALE: We do not do that any more.

MS JONES: Oh, okay.

MS DUNDERDALE: We have stopped that practice.

MR. MOORES: (Inaudible) inventory of items that we have seized, but we

are also currently in the process of acquiring a tracking and inventory system

from Environment Canada called NEMESIS. This particular system will allow us to

maintain a digital database of all seizures, all violations and everything

related to our enforcement activities that could be accessed and quarried in a

number of different ways. We are just in the process of acquiring this system

now from the federal government, and we hope to have it operational before the

end of this summer.

MS JONES: Okay. So you have money budgeted for that in

MR. MOORES: Actually, the federal government has agreed - I think, I hope

- to provide this particular system to us free of charge.

MS JONES: Oh, good.

MS DUNDERDALE: Things are not near as bad as you think.

MS JONES: You have a great relationship with the feds.

MS DUNDERDALE: That's right.

MS JONES: That is all the questions I have on the forestry piece.

Did you want to go, Lorraine, and move into the land

section land

resources, is it or something?

MS MICHAEL: Agrifoods Development, Land Resource Stewardship, 3.1.01. I

will go into line-by-line stuff again.

Once again under Salaries; an under-expenditure in the revision by almost

$200,000, then up to $1,727,000 in the estimate for this year, so just an

explanation of the Salaries there.

MS DUNDERDALE: All right, of course it includes the 4 per cent salary

increases and the twenty-seventh pay period, but it is also additional funding

to convert positions currently charged to the federal cost-shared growing

formula agreement to the provincial program.

Just an explanation of that; prior to 2003, it was a common practice when

there were cutbacks within government and we needed to lay off people,

apparently people under the agriculture program were not laid off but

transferred to the federal-provincial program. What that really meant was that

money that was intended to farmers was going to pay for people who had formerly

been employed by the department, the provincial department. By the time we came

along and did an investigation, because we started to look, comb through the

program in our program review and discovered what had been going on there. We

have started a three-year plan to get those people back over on the provincial

payroll where they rightly belong and ensure that money that is intended for

programming for farmers goes to farmers. So that is the rest of that allocation.

MS MICHAEL: That sounds confusing to me. The program with the money for

farmers, what was that program about?

MS DUNDERDALE: It was the federal-provincial program. The new program is

called the Growing Forward program and it is almost $30 million we are spending

this year. It is a variety of programs under that for funding for farmers for

different things.

Prior to 2003, a significant number of employees who normally would be found

on the provincial government payroll, in times of cutbacks were transferred over

to that program, and we are in the process of transferring them all back.

MS MICHAEL: So the money was going into their salaries instead of going

directly to the farmers for operations?

MS DUNDERDALE: Yes, what was legitimately a provincial government

responsibility was being charged out under the federal-provincial program.

MS MICHAEL: Okay. Will this end it?

MS DUNDERDALE: Pardon?

MS MICHAEL: Will it end this year?

MS DUNDERDALE: Will this end it or next year?

OFFICIAL: Next year.

MS DUNDERDALE: Next year will end it. We had a three-year program. So

this is year two.

MS MICHAEL: Okay, thank you.

The strange things that happened.

Under Employee Benefits, it used to be just $200, obviously it is going up.

Why? What is happening there? I know it is a small amount of money but -

MS DUNDERDALE: Fees for seminars and conferences and training events

during the year.

MS MICHAEL: Yes, still not much for that.

MS DUNDERDALE: No.

MS MICHAEL: Okay. The rest is pretty straightforward actually. I do not

really have a lot of questions there.

Under the revenue, the provincial revenue, what is the source of that

revenue?

MS DUNDERDALE: We do soil and plant analysis, and fees are realized from

those services.

MS MICHAEL: Oh, right. Yes, okay. Thank you.

You had a big drop. I guess it was not a demand, so it did not happen.

The next one is the Limestone Sales. All of this is pretty straightforward.

In Supplies you had a major under-expenditure. Was that a sign of what was

happening in the industry?

MS DUNDERDALE: Oh, not at all. It was the issue we had last year with the

limestone supplier, when it went down in Corner Brook, and it took some while to

get up and reorganized and so on.

MS MICHAEL: Oh, right. I remember hearing about that, yes, right.

MS JONES: Can I just ask one question on that?

MS MICHAEL: Yes, sure.

MS JONES: Mr. Chair, I just have a q