November

23, 1993

HOUSE OF ASSEMBLY PROCEEDINGS

Vol. XLII No. 20

The House met at 2:00 p.m.

MR. SPEAKER (Dicks): Order, please!

On behalf of hon. members, I would like to welcome to the

visitor's gallery from the town of Bonavista, the Mayor, Boyd Abbott, the Deputy

Mayor, Barry Randell, councillors, Harry Cuff and Don Tremblett, and the town

clerk, Dave Hiscock.

SOME HON. MEMBERS: Hear, hear!

Statements by Ministers

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

MR. BAKER: Thank you, Mr. Speaker.

Today I wish to provide hon. members with an update on the

Government of Newfoundland and Labrador's fiscal position for the 1993-94 fiscal

year.

Last year, at this time, we were facing a large mid-year

correction in our financial projections, brought on mainly by lower income tax

and federal transfer revenues and higher social and employment program

expenditures. In order to avoid a $125 million increase in our projected current

account deficit for that year, we introduced tax increases and expenditure

reduction measures which, together, reduced the projected deficit by

approximately $75 million.

This year, I am happy to report that no similar mid-year

adjustments will be necessary.

SOME HON. MEMBERS: Hear, hear!

MR. BAKER: While our economy, which is suffering from the

lingering effects of the national recession and additional fishery closures, is

expected to grow by 0.3 per cent instead of the 1.2 per cent projected at Budget

time, our overall budgetary performance for the 1993-94 fiscal year remains on

track.

The 1993 Budget projected a total budgetary requirement, that

is, the total of the current and capital account deficits, for this fiscal year

of $223.3 million. While there have been some increases and decreases in

individual revenues and expenditures, we expect that the overall budgetary

deficit will be on target.

On the revenue side, we expect that retail sales tax and

tobacco tax revenues will be lower by $15 million and $10 million each

respectively.

Also, our equalization entitlements are now expected to be

$11 million below Budget because of weak revenue growth in other provinces.

These shortfalls will be largely offset by positive adjustments to certain other

under the Fiscal Stabilization Program. This claim, which pertains to the

1991-92 fiscal year, is this Province's first under the program, which provides

a cushion against year-over-year declines in revenues. Most provinces have made

fiscal stabilization claims for 1991-92, or for previous years.

As a result of careful management of expenditures, I can

report that half-way through the fiscal year government is basically on target

with its overall expenditure budget. Increased requirements for social

assistance of $7.9 million (net) and an emergency employment response initiative

of $6 million have been offset by savings on the capital account budget of $16.2

million to date.

In order to ensure that our budgetary expenditures are not

exceeded, I will be meeting personally with all department and agency heads to

impress upon them the need to remain vigilant, and to prudently manage spending

for the remainder of the fiscal year. I am hopeful that further savings can be

achieved, so that net expenditures come in under budget for the 1993-94 fiscal

year.

Treasury Board and Finance officials are currently working on

the economic and financial outlook for fiscal 1994-95. When these projections

are finalized, I will be meeting with the public sector union leadership to

advise them of our financial position going into collective bargaining

negotiations.

I am confident that our continued approach to properly

managing the Province's finances will allow us to continue to reduce our total

budgetary requirement. We believe that this approach will enable us to preserve

our credit rating, and will thus ensure our ability to provide the essential

public services for our people.

SOME HON. MEMBERS: Hear, hear!

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

MR. WINDSOR: Thank you, Mr. Speaker. First of all, we

thank the minister for his statement. I thank him for sending over a copy even

though I just got here myself and I just had a few seconds to review it but I do

appreciate his courtesy in sending a copy to us. What he has told us, Mr.

Speaker, is that what we told him during the Budget Debate has now come to pass,

that he was overly optimistic in his projections of revenue at a time when

unemployment, we knew, was at a terribly high, incredibly high, unacceptably

high rate, at a time when the economy of the Province was so bad that government

was still predicting increases in revenues. The Premier may find it funny, but I

can tell him, the people of this Province don't find the unemployment rate in

this Province or the taxation rate that this government has imposed on them,

very funny at all, Mr. Speaker. Neither do we find it very funny that he wants

to give away one of the major resources that we have in this Province, Mr.

Speaker. We will see how funny he sees that is.

SOME HON. MEMBERS: Hear, hear!

MR. WINDSOR: We have now seen, as a result of this

government's economic policies, basically zero growth in the economy of this

Province this year. I don't know who the Premier is going to blame it on now. He

used to blame it on our buddies in Ottawa but I don't hear him lately blaming it

on his buddies in Ottawa, Mr. Speaker. We will see a new tune there now.

Now, Mr. Speaker, the minister tells us that they have lost

$36 million, as we told him he would; we said your deficit is going to be close

to $100 million and that is in reality. What is happening, he is telling us

there are going to be some offsets and he is offsetting it with capital, Mr.

Speaker. Offsetting it with capital, that is why we have such a high

unemployment rate in this Province. This government is refusing to spend its

normal allocation of money on capital expenditures, putting in badly needed

water and sewer systems and roads in this Province. The only roads they are

building, Mr. Speaker, are roads that are financed under the Roads for Rails

Agreement, that this party, when they were in opposition, decried when we made

and announce millions of dollars going into the Trans-Canada Highway and

secondary highways. The Minister has just, once again, Mr. Speaker, admitted

that he is incompetent to manage the economy of the Province.

MR. SPEAKER: The hon. the Minister of Municipal Affairs.

MR. REID: As the Members of the House of Assembly are

probably aware, there is an extremely serious fire in progress in the Town of

Ramea.

First of all, let me apologize, Mr. Speaker, to my hon.

critic. As he saw, this was just passed to me a few minutes ago; we are trying

to keep an ongoing account of what is going on there and this is the latest I

have been passed, so I apologize to my colleague on the other side.

I am advised by the Fire Commissioner that the fire started

around 10:00 a.m. this morning, and since that time, a large school - the only

one on the island, to be exact - has been destroyed, along with two homes, and a

number of other buildings and homes in the area are threatened. I understand the

winds are high and that they are impeding the fire operations.

MR. SIMMS: Where is this?

MR. REID: Ramea.

The Fire Commissioner in en route and he will be available to

provide any assistance that may be required. The latest information I have is

that there are about twelve to fourteen homes that are at present being

threatened and a number of other buildings, including the Lions Club Community

Centre and the Orange Lodge; and to make things even worse in that area, between

those two buildings, there is a huge fuel storage tank.

The Fire Commissioner has advised me that he has been in

touch with the fire department at Burgeo, and that a truck and eight men have

been dispatched by the ferry, Gallipoli, to the scene of the fire. Just before

coming to the House, I had been advised that this truck and the men have now

arrived. The Fire Commissioner also informs me that the RCMP, representatives of

Newfoundland Telephone as well as the Canadian Coast Guard are also en route or

on standby and will provide whatever assistance may be available.

Mr. Speaker, we have dispatched a water bomber from Gander

leaving approximately a half-an-hour ago, to assist if possible and await

directions from the ground crew when landed.

I understand that most of the ponds in the Ramea area are

frozen, and unless they can access some water in the area it will not provide

any significant assistance.

It's also my understanding that the town has declared, as of

11:00 a.m., a state of emergency. The Emergency Measures Division of the

Department of Municipal and Provincial Affairs is also on stand-by and will

provide whatever assistance is required. We will assist in every possible manner

to bring the fire under control. Emergency Measures Division is coordinating

communications through the Forestry personnel who are now on site.

Mr. Speaker, I've asked my department to give me up to date

briefings all afternoon. So if anyone is interested in what's happening down

there on a personal basis - I've spoken already to the member from Ramea. I

should have, as the afternoon goes on, further information to relay to anyone in

the House. Thank you.

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

MR. WOODFORD: Thank you, Mr. Speaker. There's not much

that can be said about the minister's statement except for the fact that for the

sake of all the people in the community as a whole in Ramea we hope there will

be no further tragedy. I understand from the minister's statement that there's

no loss of life or anything involved so far. Hopefully with the help of other

parties that the minister has involved in this, and other departments,

especially the Department of Forestry and Agriculture with regards to a water

bomber, any further damage and tragedy can be averted in the Town of Ramea.

It also means though that for all municipalities in the

Province, that his department be more cognizant of the importance of fire

brigades and volunteer fire brigades and what have you in the communities in

this Province. Now granted, they may have the best in the Province, but in this

case it may not be any good anyway. Apart from that, you can sometimes have all

the equipment you want, the best people involved you want, but Mother Nature

makes sure that it can't be handled.

The minister is cognizant of what's going on and hopefully

with the assistance of other departments any further damage can be averted.

Thank you, Mr. Speaker.

MR. SPEAKER: Oral Questions.

MR. SIMMS: Mr. Speaker, before we get to Oral Questions.

MR. SPEAKER: Yes.

The hon. the Leader of the Opposition.

MR. SIMMS: On the matter I spoke to Your Honour about

earlier. I'd like to take this occasion to pay tribute to an exceptionally

dedicated man who worked, lived and was part of the lifeblood of the Grand Falls

- Windsor area for the better part of this century. He happened to have passed

away when the House was not in session, so it's really my first opportunity.

The gentleman I refer to is Mr. Jack Cater, who died October

5. He was ninety-four years of age. He was involved in the Royal Newfoundland

Regiment. He joined it in fact in late 1916. He fought in the First World War

and came back then to Grand Falls where he left a lasting legacy over the next

seventy-five years at least.

He was a Past President of the Great War Veterans Association

from 1921 until 1950, a fairly lengthy term of office, and then that became the

Royal Canadian Legion, Mr. Speaker. He was an active member and honourary

President of Grand Falls Branch XII of the Royal Canadian Legion, and Mr. Cater

was the last surviving First World War veteran of that local branch.

He worked with Abitibi-Price for over half a century,

fifty-two years involved with the senior citizen's club, Past Master of Lodge

Northcliffe of the Masonic Order, Past Chairman of the school board, and at the

funeral service the Royal Newfoundland Regiment, which was the same force that

Mr. Cater had served with during the war, gave him a twenty-one gun salute.

I would like Your Honour to send a letter of condolences. He

is survived by some twelve children, forty-nine grandchildren, and fifty-two

great-grandchildren. He deserves some tribute and I pay that to him here today

in the House.

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

Agriculture.

MR. FLIGHT: Thank you, Mr. Speaker.

Mr. Speaker, for this side I would like to add our voice and

support to the comments made by the hon. Leader of the Opposition. Although I

probably did not know Mr. Cater as well as the hon. Leader of the Opposition, I

had met him on several occasions. I am aware of his contribution to the

community. I am aware, and everyone in Central Newfoundland is aware, of his

commitment and his years of services in the Armed Forces and later on his

invaluable contribution to the Canadian Legion in Grand Falls and his invaluable

contribution to the community itself, Grand Falls - Windsor.

I want to join with the hon. member in endorsing the request

that this House would offer its condolences to the family, Mr. Speaker.

Thank you.

Oral Questions

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

MR. SIMMS: Mr. Speaker, today I want to follow up on some

questioning I had yesterday, or made yesterday, in the House for the Premier,

but today I want to follow up on some of the answers he gave yesterday in the

House, and specifically I want to probe into the mysteries of the five man task

force of outside experts that the Minister of Mines and Energy told us about

yesterday that was hand-picked some time in June - he was not quite sure when -

and then apparently made some kind of report to the government in July or August

- again no specific time - recommending that Hydro be privatized.

Now, Mr. Speaker, a task force is a very powerful and very

public body, much like a commission, a Royal Commission. This particular task

force, however, is cloaked in mystery, surrounded by mystery. When I asked the

Premier yesterday to table their report he said he couldn't because, and I

quote, their "report was verbal."

Mr. Speaker, that is mighty strange for a task force. There

is no public record of their recommendations, no evidence, no rationale on the

public record to back up their advice. So I want to ask the Premier today, is

there any such record - perhaps a Minute in Council, Order in Council - that

approved the appointment and the terms of reference of this so-called task

force? If there is, will he table it in the House, and table their terms of

reference?

MR. SPEAKER: The hon. the Premier.

PREMIER WELLS: Mr. Speaker, I would have to agree with

the hon. member if a task force had been appointed. I heard the phrase "task

force" for the first time when I heard the hon. member mention it a minute ago.

There never was a task force appointed. Let me remind hon. members again what I

said in the House. Go back and read my statement of yesterday.

When the report came in from the Hydro Board and their

advisors, after discussion with other members of P and P, I asked these five

people individually to consider the reports, the advice. I gave them copies of

the reports and said: Please look at this. You have a lot of background and

knowledge and experience. Please look at these recommendations. And would you

agree to give us, on a personal basis, some advice? We are not hiring you, we

are not going to pay you. You're not a task force, you don't have to prepare any

report. I never suggested "task force" - "task force" is the Leader of the

Opposition's phrase for it, or somebody else's, if somebody else used it. It's

not mine - I didn't use it.

They were five individuals who were asked to do this. I asked

them if they would agree to look at it, then get together and meet with myself

and the minister and give us their personal advice on it. They did that. I then

asked them to do one more thing: I asked them if, as individuals, they would

come back to Cabinet and give their advice to the whole Cabinet. They did that,

too. There never was a task force. They were never expected to formalize any

report, never requested to, and frankly, never offered.

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

MR. SIMMS: Mr. Speaker, this gets more unbelievable as

the days go on. It wasn't I who used the term "task force," it was his own

Minister of Mines and Energy yesterday. If you read Hansard today, Dr. Gibbons

says, on page 1 -

MR. SULLIVAN: And 2.

MR. SIMMS: - he says: "It was in June that we appointed a

task force of outside experts...." Then he went on in the next paragraph - he

didn't just use it once, he used it just down the next paragraph: "I'm not sure

of the exact day but it was in June that we appointed a task force...." So it's

not the Leader of the Opposition who is using the term "task force," it's his

own minister. So they should get their act together and give this House the

correct information.

SOME HON. MEMBERS: Hear, hear!

MR. SIMMS: Mr. Speaker, whatever it was called, I want to

ask the Premier this: Did this so-called committee, or group of people that he

refers to - I'll wait till the minister gives him some advice, because I want to

make sure he hears the question.

MS. VERGE: Getting their act together now.

MR. SIMMS: Getting their act together finally, Mr.

Speaker. I ask the Premier: Did this group of people, these individuals, whom

the Premier put so much trust and faith in and, in fact, accepted their

recommendation to privatize, did they meet with the government's financial

advisors, ScotiaMcLeod and RBC Dominion Securities, who prepared a larger and

greater study of the Hydro issue? Did they consult with any other experts in the

field? Did they meet and consult with the employees of Hydro or Newfoundland

Power? Did they, or did they have any plans to, meet and consult with the people

of this Province? Can he answer those questions?

MR. SPEAKER: The hon. the Premier.

PREMIER WELLS: No, no, no, no, no. They weren't expected

to. They were five individuals from whom I sought personal advice. They gave me

their personal advice. I then asked them to give it to the total Cabinet. They

gave it to the total Cabinet. Now, maybe the members opposite have such a

fixation on something, or they are trying to fabricate something, that they

cannot see a normal circumstance and they somehow have to try to fabricate this

as being abnormal. It is a perfectly normal, logical, simple, straightforward

proposition. To the best of my knowledge, but I will have to ask each one of

them, not one of them spoke to anybody else - they weren't requested to, they

were not being paid to - they were not being paid at all. They were not a task

force. They were individuals giving their individual advice. Now, if that is too

complex a concept for the members opposite to understand, well I feel sorry for

them.

MR. SPEAKER: Order, please!

The hon. the Leader of the Opposition.

MR. SIMMS: Thank you, Mr. Speaker.

No, Mr. Speaker, it is not the opposition that is fabricating

anything here. I suggest that it is the Premier and the government of this

Province that are fabricating something here, that's what is happening.

SOME HON. MEMBERS: Hear, hear!

MR. SIMMS: And they are getting caught up - every single

time they answer a question they are getting caught up in their own web, that's

what is happening here, Mr. Speaker. Now it appears we do not have a task force

even though the Minister of Mines and Energy told us yesterday that there was a

task force. Now we are told there is no task force so it appears we have a task

force or a group of people that wasn't even appointed, never met with anybody in

particular, never wrote a report and may not even have read the financial

reports of the fiscal advisers to the Province, for all we know. That wasn't a

task force, it wasn't a group of people, it was a tea party! The Premier invited

a group of people over for a cup of tea. Now, that's what happened.

The saddest and most regrettable thing about all of this, Mr.

Speaker, is that the Premier yesterday admitted in this House that he acted on

the verbal, personal advice of three or four men - the majority, he said, not

everybody, three or four men who are involved in that group of people. So I want

to ask him if he will tell the people of this Province, tell the House clearly,

as clearly as he possibly can, why did he accept the advice of this group of

people over the extensive written financial reports and recommendations of the

Province's financial advisers, ScotiaMcLeod and RBC Dominion Securities, who,

the Premier told us yesterday, did not give him a full recommendation to

privatize? He admitted that here in this House yesterday. Isn't it just because

he, the Premier, was determined to privatize Hydro? That is what we have going

on here - but since the financial advisers did not give him the recommendation

that he wanted to get, Mr. Speaker, he had to create the pretence that a task

force or a group of experts had somehow done a study of all of this and

recommended privatization. Isn't that what is going on here?

MR. SPEAKER: The hon. the Premier.

PREMIER WELLS: Mr. Speaker, I know the hon. members

opposite would like to be able to find something wrong. They are not interested

in the benefit of the Province. They are not interested in the benefit of the

people of the Province, they are trying to throw a monkey wrench into the

government; and they keep struggling but they are fighting and beating their

heads against a stone wall because they have no monkey wrench to throw into any

spokes of the government.

Now, Mr. Speaker, I heard the hon. the Leader of the

Opposition on television yesterday, saying that I reported to the Board of

Trade, that, in fact, the Hydro Board and the group of advisers - and I said on

the bottom of page 3 of my speech, he said, that I told them that they

recommended against it. Well they did not. That is what he said on television.

That is what was there on television. That was clearly what he proposed on

television, that there had been a contrary recommendation. In fact, Mr. Speaker,

the financial advisers and the committee of the board of Hydro clearly indicated

to government - they studied all four proposition, they said they didn't

recommend one. They recommended against selling or accepting Fortis' proposal

but they were quite prepared to establish that the status quo was viable. They

said it wasn't essential to privatize. The status quo was viable. Now, it may

well be that if I pursued this and said, well, do you think we should privatize?

maybe they might have recommended that we do. I can go and ask them again and

see if that is what they - but I took a different course, the government took a

different course. They said okay - but it is very simple why we took a different

course because that was a committee of the board of Hydro and the advisers that

they had put in place. And I didn't know if their judgement might be coloured on

whether or not Hydro should be privatized, so I went outside and said, here is

the information - now, this is exactly what I said in the House yesterday, or

what I said to the media, I don't remember where it was - here is the full

information that we got from Hydro's board committee and their financial

advisers; you take a look at it and, in particular, tell us whether or not you

think we should privatize, and if we do privatize, on what basis we should go.

They gave us good and sound advice, the government accepted their advice and we

are in the process of pursuing it.

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

MR. SIMMS: Mr. Speaker, the Premier can try to explain

his way out of it all he wants. The words are clear in his speech and we all

know what was said in the speech, Mr. Speaker. I am not going to get into a

debate with him over that because it is as clear as a bell and anybody who wants

to read it can read it. But I am reminded, as I ask questions and hear the

answers, of the old saying, 'Oh, what a tangled web we weave when first we

practice to deceive,' because I think that's what is happening.

Mr. Speaker, the reality here is that, unfortunately, these

five gentlemen have now become the scapegoats the Premier wants to use to

provide the political cover he needs to try to privatize Hydro against what was

really a recommendation of his financial advisers.

Now, Mr. Speaker, the Premier told us yesterday in the House

that the five men he invited to advise him at this meeting, or tea party,

whatever it was, were all independent, to use his words. I want to ask him, how

does he know that when yesterday he couldn't give us the answers to the other

questions we asked? He told us yesterday he didn't know if any or all of them

were Fortis shareholders and it never occurred to him to ask, yet he acted

solely and almost immediately on their individual and personal advice. I want to

ask him today, does it matter, even now, to the Premier that the three or four

men who gave him the advice that he wanted to privatize Hydro could, in fact, be

in a position to benefit directly or indirectly from the sale of Hydro? Is that

acceptable to him? Does that even matter to him?

MR. SPEAKER: The hon. the Premier.

PREMIER WELLS: Mr. Speaker, I should, at the outset,

comment on the earlier comments the member made before he asked the question,

and say I don't question his knowledge of weaving tangled webs for purposes of

deception. I expect he is quite knowledgeable in that field. I don't question

his knowledge about weaving tangled webs. He has already demonstrated his

capability.

Mr. Speaker, those five people were chosen because they are

the five most knowledgeable people that I could think of in the Province, the

five most knowledgeable people, and I challenge the hon. member to name others

more knowledgeable or having better judgement.

AN HON. MEMBER: Cyril Abery.

PREMIER WELLS: I have already dealt with the concern

about Mr. Abery. He has a concrete mind-set on this matter. Very simple and

straightforward, he has a concrete mind-set and an equally concrete objective,

so you don't expect sound judgement from that. I am quite familiar with Mr.

Abery's judgement on the matter and I had no reason to have any great level of

confidence in it, so I asked for advice from people I knew to be competent and I

knew had good judgement, and I can't think of any other person in the Province

who could bring better judgement to bear on that issue. I never even thought

about ownership of Fortis shares or any such thing. I looked at their background

and I expected and I feel I got from them good sound judgement in the best

interest of the taxpayers of this Province.

SOME HON. MEMBERS: Oh, oh!

MR. SPEAKER: Order, please!

The hon. the Leader of the Opposition.

MR. SIMMS: Mr. Speaker, we have heard the expert on

concrete mind-sets just speak in the House, talk about everybody else.

Remember now, there was a group of five, a committee of five,

a task force of five, or whatever you want to call it. There was a group of

five, he says, and he said only the majority of them advised him to privatize

Hydro, not all of them, so I assume there were three or maybe four. So, the

three or four people we assume said, and I am quoting from Hansard, that the

sale "was in the best interests of the people of this Province. They urged us to

act in the best interests of the people of this Province." That is what the

Premier said yesterday in describing the three or maybe four, the majority, of

that group.

Now I want to ask him today: What special right or authority

did these five men have to speak for the people of this Province, all 600,000 of

us? Why did the Premier consult them and not consult the people of Newfoundland

and Labrador, which he should have done?

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The hon. the Premier.

PREMIER WELLS: The hon. member is, as usual, putting the

cart before the horse. What we asked those people for, and what they gave us,

was their good, sound judgement on whether or not the government should proceed

along these lines to develop the possibility of a privatization. We accepted

their judgement, and I think their judgement is sound; and they have as much

right to express an opinion as to what, in their judgement, is in the best

interest of the Province as the hon. member does. They are citizens of the

Province. They have as much right as anybody, but it is the fifty-two people who

sit in this House who will decide. They have the responsibility to decide, but

that comes afterwards. The hon. member is putting the cart before the horse.

MR. SIMMS: You have no mandate.

PREMIER WELLS: The Legislature in Nova Scotia had no

mandate to do it either; they have done it. The former government had no mandate

to take over Churchill Falls either. They had no mandate to develop Sprung. They

had no mandate to take over Churchill Falls, but they did all that.

MR. SIMMS: Will you accept the mistakes of the past and

go on from there?

PREMIER WELLS: No, I don't.

MR. SIMMS: You don't?

PREMIER WELLS: I recognize that this House has a

responsibility to manage the public's affairs, and that is precisely what the

government is doing, and it is the government's responsibility to lead and

develop the proposals and bring them to the House for consideration, and that is

precisely what is happening, and it is too bad the hon. members opposite cannot

find something really wrong with it. I understand what they want to try and do

for their own political motive, and they keep trying and they keep trying, and

no doubt they will keep trying but they will not succeed, Mr. Speaker.

MR. SPEAKER: Order, please!

The hon. the Member for Mount Pearl.

MR. WINDSOR: Mr. Speaker, I would like to follow on in

the same issue, but a little different line.

I would like to ask the Premier if the negotiations that are

taking place, if included in that negotiation might be some retention of partial

ownership of the proposed new corporation, whatever it might be? In other words,

does government intend to sell out all of the Province's rights, all of the

people's rights, to Newfoundland and Labrador Hydro, or does the Province

propose to keep some of it?

The second part of that question, and I might as well ask two

parts, if I may, to the Premier: Newfoundland Hydro is three or four times as

large as Fortis Inc. Why does the Premier think that this smaller corporation is

better able to manage the affairs of the Hydro Corporation than the large Hydro

Corporation? Would he tell us that?

MR. SPEAKER: The hon. the Premier.

PREMIER WELLS: Those are the two most intelligent

questions of the last two days, Mr. Speaker, and I commend the hon. member for

it.

As soon as I said that, I have forgotten what the first one

was. Oh, I know it; I remember now what it is. The first question was: Does the

government propose to retain any portion of it, or would we be selling the whole

of it? No, Mr. Speaker, the government's proposition is to sell all of the

shares and not retain any portion of it. We are thinking in terms of total

privatization and not having a governmental involvement at all.

AN HON. MEMBER: Except Churchill.

PREMIER WELLS: Well the Churchill - CF(L)Co and Lower

Churchill would not be included in it at all. That would be set aside; but of

the merged operation that would not include Churchill, we would not be retaining

any shares on a continuing basis.

The second question that the hon. member asked was why

government would think that a smaller corporation like Fortis, which is only

about one-third of the size of Hydro, give or take, his proposition was that

Hydro was three or four times the size of Fortis. The round numbers that we are

looking at, for purposes of general judgement, is 70/30. It may be 69/31; it may

be 72/28. Give or take, for purposes of judgement, we are looking in the

vicinity of 70 per cent attributable to Hydro and 30 per cent attributable to

Fortis, so the hon. member is roughly correct. It is at least 2 1/2 or 2 2/3

times the size of Fortis. Remember, it is not Fortis that will be continuing the

operation, it is a merged company that will be genuinely the result of the

merger of the Hydro operation with the Newfoundland Power operation, so it is

not the much smaller corporation, Fortis, that is going to be continuing on. If,

as some people in the Province have been trying to portray it was the sale of

Hydro to Fortis, the hon. member would be quite correct, but it is not; this is

genuinely a merged corporation. We are not turning over the management of all of

the Hydro assets of the Province to the executive management team of Fortis.

MR. WINDSOR: Sure, you are.

PREMIER WELLS: Well, the hon. member can keep saying that

if he wants to, but we are not. It is genuinely a merged corporation in terms of

personnel, assets, with a totally new corporate structure, totally limited and

restrained by the provisions of a privatizing act, assuming that this all goes

forward. If it does not go forward on a merged basis, then we will be looking at

going forward on a stand alone basis, but the best advice we had, is, going on a

merged basis is best, so I emphasize again, it is not the smaller corporation

doing it, it is the new, big merged corporation.

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

MR. SIMMS: Giving it away, in other words.

MR. WINDSOR: Mr. Speaker, I am sure the Premier must have

looked at the books, the annual reports of Newfoundland Power and Fortis. I am

sure he must have looked at how the companies work and as the Premier knows, the

easiest business in the world to run is a utility which has its profit margin

set by the Public Utilities Board. It is the only case where you start out

knowing here is your profit and after your profit you add all of your expenses

to find out what your rate is going to be, compared to a normal business where

you do business, you take in your expenditures and your revenues, whatever is

left over is profit. If you are under you have a loss, but in this case your

profit is guaranteed.

You start up in the case of Newfoundland Power with a 13 per

cent profit margin and you work backwards from there and, Mr. Speaker, if the

Premier looked at the books, the annual reports of Newfoundland Power and

Fortis, last year's annual reports which I have here, it gives the performance

of both corporations over the past ten years and you will find that Newfoundland

Hydro, of course, is a very profitable company since its rates are set by

Newfoundland Public Utilities Board. They are fully owned of course, by Fortis,

but if you look at each of the years since Fortis has been in existence, which

is only the last five years that Fortis has been in existence, each year -

AN HON. MEMBER: (Inaudible).

MR. WINDSOR: 1988, they are actually shown here since

1983. If you compare these two reports carefully, you will see that from 1983 to

1987, the profits of Newfoundland Hydro and Fortis are dollar for dollar, in

other words, all of the profits to Fortis is what was made by Newfoundland

Power. From 1988 to 1992, you will see, in every year without fail that the

profit of Newfoundland Power is greater than the profit of Fortis. In other

words, Newfoundland Power being a wholly owned subsidiary of Fortis, has

contributed more to Fortis than they have made; in other words, Fortis has lost

money in each of the last five years, the sum, Mr. Speaker, of $5.3 million over

those five years.

Now if you also want to take for the first three quarters,

the reports of both corporations for this year, 1993, you will see that Fortis

has lost another million dollars in the first nine months of 1993. In other

words, $6.5 million Fortis has lost, which is a commercial operating company, it

is not protected by having its rates and profits set by the Public Utilities

Board. In other words, Fortis has lost $6.5 million of profits made by

Newfoundland Power. Would the Premier like to tell us: Does he still think that

Fortis is a good company to take over Newfoundland Hydro and how much does he

think of Hydro's profits Fortis is going to lose?

SOME HON. MEMBERS: Oh, Oh!

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

The hon. the Premier.

PREMIER WELLS: I thought I had explained it but obviously

it did not sink in so let me explain it again.

I was not aware of the figures that he just -

MR. WINDSOR: What?

PREMIER WELLS: I was not aware of the Fortis' figures

that he just told me.

MR. WINDSOR: The Premier is not aware that Fortis has

lost money every year?

PREMIER WELLS: I was not aware of the figures that he

just told me but I accept his statement, he had the statements there. I do not

quarrel with his proposition and I conclude from that, that must be their loss

on the other operations they've acquired an interest -

MR. WINDSOR: (Inaudible) shopping malls and other

foolishness they're into, and they don't know how to operate them.

PREMIER WELLS: Yes, well, that may be or may not be.

That's got nothing to do with the hydro operations, with their hydro-electric

operation. Let me say again. Fortis is not taking over Hydro. Fortis is not

taking over Hydro. Hydro is not being sold to Fortis. Please understand this

proposition. If you don't understand it, go back and read it and examine it

again. But if you're trying to make these statements for the purpose of

misleading the people of the Province, then for heaven's sake stop doing it.

Fortis is not taking over Hydro. We're talking about merging. The real and the

substantial control of it will remain, and will be provided for, under the

privatization act that will -

MR. WINDSOR: Nothing to do with the question. Answer the

question.

PREMIER WELLS: This is the question.

MR. WINDSOR: No it's not.

PREMIER WELLS: Then I misunderstand his question.

MR. WINDSOR: The point of it is, is the management

capable? They're losing money every year.

MR. SPEAKER: Order, please!

PREMIER WELLS: It's not Fortis management that will be

managing the new company! It's a merged operation. Now I know the hon. members

opposite don't want that to be the case, because it spoils and destroys the only

argument they have. I understand that it cuts the legs right out from under them

and it spoils every argument they've tried to put forward, and they don't want

it to be the case. But let me say again, the reality is this proposal is for a

merger of the two hydro-electric operations. Those other business assets of

Fortis would not be part of the overall merged hydro operation. They would be

out to the one side. Whether they were kept or sold, or whether they continued

to operate or make money or not, wouldn't affect how the public utility and the

hydro-electric aspect of it was managed in any respect whatsoever.

The same people who are involved in the management of Hydro

now and people who are involved in the management of Newfoundland Power now I

would expect would continue to be involved in the management of the new

hydro-electric company, subject to such changes as the new board of directors

would want to put in place in order to ensure that we had first-quality

management, and that's what I would expect we would have.

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

Mount Pearl.

MR. WINDSOR: Mr. Speaker, yes, we know who the board of

directors will put in place. We can be sure Angus Bruneau will still be there

and still will be managing Fortis, which is shown to be a failure. Anybody can

run Newfoundland Power and make money when the profits are fixed by the Public

Utilities Board. But when you have to compete out there in the real world,

that's when things start to get tough, when you don't have a monopoly and you're

not protected.

Mr. Speaker, will the Premier tell us that whatever money is

paid to the Newfoundland government by Fortis, obviously has to be raised. It's

equity that has to be invested, even if they simply replaced the equity that the

Province has in it. We know that Fortis, for example, in their present share

have 43 per cent equity in their company,

whereas in Hydro we have less than 20

per cent equity. Fortis will have to have approximately that share of equity to

debt ratio in order to be successful and be competitive in the bond market,

therefore they're going to have to put in another $300 or $400 million on top of

it. That's $700 or $800 million in total that will have to be invested by Fortis

into the new corporation, which is taxable, and which will give them returns of

approximately 13 per cent, the average over the last number of years. They have

been awarded a 13 per cent return on their investment, down this year to 12.4

per cent. But it's been 13, 13.9, even as high as 15 per cent seven or eight

years ago, versus the 5 or 6 per cent that's awarded by the Public Utilities

Board to Hydro. Don't forget, in order to earn 13 per cent that corporation has

to pay corporate taxes.

MR. SPEAKER: Order, please!

If the member has a question, question period has expired.

The member hasn't yet asked one. I'll give leniency in this case, but if there's

a question I'd like it to be asked.

MR. WINDSOR: Thank you, Mr. Speaker. I'm just about to

the question. The point is this, if the corporation has to pay income tax,

therefore in order to return 13 per cent they have to earn 25 per cent. That

will be reflected in the rates. You're talking about $150 million a year profit

that will flow to shareholders primarily in Ontario. Where is that $150 million

coming from if it's not going to come from rate increases?

MR. SPEAKER: The hon. the Premier.

PREMIER WELLS: There are two or three things that need to

be addressed.

Fortis is not going to pay the Newfoundland Government a

dollar - not going to pay the Newfoundland Government anything.

Let me emphasize again: This is a merger; and of the

corporate structure that will remain, the existing Fortis shareholders will have

roughly 30 per cent of the shares and the Newfoundland Government will have

roughly 70 per cent of the shares.

The Newfoundland Government proposes to sell its entire 70

per cent of the shares to whoever will buy them, provided no one person or group

of persons or corporations can own more than 15 per cent of the shares.

MR. WINDSOR: Do you know who owns Fortis now?

PREMIER WELLS: No, widely held.

MR. WINDSOR: Do you know who the largest shareholder is?

PREMIER WELLS: The largest shareholder, I believe, is the

Ontario Municipal Employees Pension Fund.

MR. WINDSOR: They own 16 per cent.

PREMIER WELLS: Okay. Well, they will have to drop to 15

per cent if the merger takes place, because the proposal is that nobody could

hold more than 15 per cent; or if they happen to hold more than 15 per cent they

couldn't vote more than 15 per cent, which is the same effect.

AN HON. MEMBER: (Inaudible).

PREMIER WELLS: Well, the 15 per cent - it may be 15 per

cent, but of the bigger company they would be within the limit. They would be

down to 5 per cent or 6 per cent.

MR. TOBIN: That is not the (inaudible).

PREMIER WELLS: The hon. member asked, I am answering it.

The hon. the Member for Burin - Placentia West can ask his own question when he

wants to, but he can't answer the ones that I am asked.

So, Mr. Speaker, I just want to correct that again. The

situation is that Fortis will not be paying the Newfoundland Government

anything.

Now, it is true that this kind of privatization will result

in a greater level of equity and a lower level of debt, and that has certain

other financial consequences, one of which is income tax. So the new merged

company would, like the existing Fortis or Newfoundland Light and Power, have to

pay income tax, but the taxes paid from the new merged company would, like the

taxes presently paid by Newfoundland Light and Power or Fortis, come back, or

largely they would come back, to the Government of Newfoundland under the Public

Utilities Income Tax Transfer Act, under PUITTA, so it would be returned.

Now the government has to make a decision as to how it

handles that. Do we take that in as tax revenue, or do we let what is there now

- do we sort of maintain the status quo, keep the same level of tax revenue as

we have now? Do we not let the privatization alter the tax revenue at all? And

if we can, we can do as Nova Scotia did. They provided for a rebate to the

utility company of the entire increase they got from taxation because of the

operation of PUITTA, and by doing that they kept the rates down.

Now, these are one of the factors that government has to take

into account in its decision of privatization, and when we have a formal

proposal to bring forward to the House, we will do so, and at that time,

everybody will understand where it stands.

MR. SPEAKER: Order, please!

The time for Oral Questions has elapsed.

Presenting Reports by

Standing and Special Committees

MR. SPEAKER: The hon. the Member for Burgeo - Bay

d'Espoir.

MR. GILBERT: Thank you, Mr. Speaker.

At this time, I would like to present the report of the

Social Legislation Review Committee on Bill 1, "An Act Respecting A Smoke-Free

Environment In The Workplace And In Public Places In The Province", and also

Bill 7, "An Act Respecting The Control Of The Sale Of Tobacco To Minors."

MR. SPEAKER: Further reports, the hon. the Minister of

Finance.

MR. BAKER: Thank you, Mr. Speaker.

Pursuant to

section 55, paragraph 3, of the Financial

Administration Act, I wish to table the following guaranteed loan pay-out by the

Province since my last report to the House.

Answers to Questions

For which Notice has been Given

MR. SPEAKER: The hon. the Premier.

PREMIER WELLS: Mr. Speaker, yesterday in the House, the

Leader of the Opposition asked this question: Now I want to ask the Premier if

he can tell us how much these financial advisers - that is, I assume,

ScotiaMcLeod and RBC Dominion Securities - how much these financial advisers

will make if there is a successful merger and the public sale of the shares

following the merger? Then he asked me to confirm, `the figure we are hearing,

that the financial advisers stand to make somewhere in the neighbourhood of $35

million to $40 million.' No, Mr. Speaker, to the best of my knowledge, his

information along those lines are incorrect. But let me explain - I can't tell

him because nobody knows at this moment precisely how much it is, but let me

explain the basis on which it would be determined, the sort of general approach,

a formula, because I can't give precise numbers but let me tell you I can give

an estimate of what the formula might produce.

AN HON. MEMBER: For a transaction with the government?

PREMIER WELLS: Yes, but I want members to understand that

it is not a precise number. For example, those two advisers would be paid a

fixed monthly fee for the service they are providing because this is a massive

piece of work. We need their expertise and they are providing that. They are

being paid a fixed monthly fee and if the transaction doesn't go ahead then, of

course, that is the end of it. They get paid their fixed monthly fee for their

services and no more. If the transaction goes ahead, they would get a fee for a

successful base that would reflect the level of success they would achieve in

getting a return for the government. So the higher the level of return they

could get for the government, the sort of greater the level of fee they would

get. The lower the level of return they would get for the government, the lower

the level of fee that they would get and any amount that they were paid on a

monthly basis would come off the fee totally. So it would be eliminated. There

wouldn't be a duplication. It is not the basic fee plus this incentive.

AN HON. MEMBER: (Inaudible).

PREMIER WELLS: Oh yes, there could be, but I just -

AN HON. MEMBER: (Inaudible).

PREMIER WELLS: I am just saying what is proposed at this

stage is this - what has been proposed is that fixed monthly fee and that they

would have an incentive to achieve a higher return for the Province. We would

expect that it would be somewhere in the vicinity of $2.5 million, that would be

the cost. If they were extremely successful it could be $2.7 million or $2.8

million. If they weren't so successful it might be $2.4 million, but roughly,

give or take, about $2.5 million. Now, that is the fee that they could expect to

get. But, I have to emphasize, that is what they would get as fees from Hydro

for providing these services. What the hon. member asked - because I want to

make this quite clear - is how much the financial advisers can expect to make?

Now, I have told you that basis. In addition to doing that kind of work, they

may well be - they may or may not be but it is probable that they would be

involved with a consortium of financial institutions throughout the country.

In the case of Nova Scotia Power there were fifteen or twenty

different financial institutions that were the syndicate that bought up and sold

into the investment community. In other words, the Government of Nova Scotia was

assured of its return. The Government of Nova Scotia could have taken its shares

and just put them on the ordinary market and sold them themselves, in which

case, they would pay the ordinary market fees of 2 per cent or 2.5 per cent,

whatever the normal fee is.

MR. SIMMS: Nova Scotia (inaudible) it was going to merge.

PREMIER WELLS: Nova Scotia did their merger twenty years

earlier when they nationalized, so they had merged a different way twenty years

earlier. It was the same kind of thing, just a matter of selling shares into the

market. Now, when you sell shares into the market you can create the shares,

have them listed, and let the normal market forces do a buy and take, or you can

find a group of investment dealers who are prepared to guarantee you that they

will be sold by guaranteeing you the money for them. Now, that is what Nova

Scotia did, and with sales of this magnitude, that would be the normal thing to

do and I expect we would propose that the same thing be done here.

The level of return varies, depending upon the kind of sale

that takes place. If it is an instalment sale to residents within the Province,

as some of them were in Nova Scotia - I think I indicated yesterday that the

Nova Scotia proposal provided for residents of Nova Scotia to be able to buy

shares without having to put the cash up front and they could pay for it on

twelve equal instalments over the next twelve months, and in the meantime they

got the benefit of getting the dividends so, in effect, there was a sort of

discount for Nova Scotia residents buying the shares. There is a strong

recommendation that the same should be done here and that is an incentive for

Newfoundlanders and Labradorians to invest in the shares of the merged

corporation.

Now, there is apparently one level of commission if the

brokers sell on that basis and there is another level of commission if the

brokers sell on the more conventional basis of selling to the general investment

community. They tell me that it worked out in Nova Scotia at roughly 4.5 per

cent. Now, even knowing the 4.5 per cent I cannot tell you how much that might

amount to.

AN HON. MEMBER: At $750 million it doesn't take long to

figure out.

PREMIER WELLS: That is if $750 million is the number, but

you do not know that is the number. It might be $500 million, $650 million, $700

million, or it might be $750 million. The hon. member sits in the chair and

throws out that number as though he is completely confident and he know what he

is talking about, but I can tell you he probably doesn't. The number is probably

wrong. I can tell you that is probably a wrong number. Nobody knows precisely

what the dollar will be because you do not know what the total share value will

be. That will depend on how much of a premium to book value we are able to get

for the shares, and the kind of market at the time at which it goes to market.

There are a whole lot of factors.

MR. SIMMS: Remember my question now, how much -

PREMIER WELLS: How much these financial advisers will

make if there is a successful merger and public sale of shares follow? I have

told hon. members what the fee would be for those financial advisers. Now,

remember, all of that additional, they may or may not be involved. It is

probable that they would be but there would be fifteen or twenty others

involved, too, so it is not those financial advisers, it is the financial

investment community generally.

SOME HON. MEMBERS: Oh, oh!

MR. SPEAKER: Order, please!

The hon. the Minister of Mines and Energy.

DR. GIBBONS: Mr. Speaker, I committed yesterday to give a

date as to when that committee of special people was put in place. I think I

inadvertently called it the task force for some reason yesterday but it is five

individuals.

AN HON. MEMBER: Twice.

DR. GIBBONS: Yes, I know I repeated that phrase twice,

but in the spring, I called it a committee.

MR. SIMMS: In October you called it a task force.

MR. SPEAKER: Order, please!

DR. GIBBONS: In October I called it a committee. On

October 8th, I called it a committee and I call it a committee now - but it is

five individuals and the date was June 4.

Petitions

MR. SPEAKER: Order, please!

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

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

I wish to present a petition on behalf of the parishioners of

St. Agnes '& St. Michael's Parish in Pouch Cove and Flatrock. The prayer of the

petition is: We, the undersigned, are committed to the highest quality education

for the children of our Province. We support Roman Catholic schools and want to

keep them. In the same way, we support the rights of others to have the schools

they desire. We also support co-operation between the churches and education,

especially shared service schools where they are needed. We do not want our

rights and the rights of other people in our Province taken away, and we ask

you, as our representative, not to tamper with the rights we now have under the

Constitution.

Mr. Speaker, I signed the petition, supporting it.

Newfoundland and Labrador had a denominational system long before Confederation

and it was confirmed in the Terms of Union with Canada in 1949. I agree that we

should have co-operation between churches when it comes to education. I agree

with shared services where it is demonstrated that shared services are needed,

where shared services are wanted and where shared services are feasible and make

sense.

If the education system is to be changed or has to be changed

for an improved system, benefits have to be first to the students. Our first

consideration has to be to the calibre of education that our students receive.

The churches must have a say in a major way with respect to any changes in our

educational system. They have to be listened to, and they have that right under

the Terms of Union of Confederation in 1949. Mr. Speaker, I also believe that

the parents should be consulted before any changes are made with our education

system.

Thank you, Mr. Speaker.

MR. SPEAKER: Thank you.

The hon. the Member for Waterford - Kenmount.

MR. HODDER: Mr. Speaker, I would like to reflect on the

petition. I am very pleased with the fact that the parents of the two parishes

have written that they are committed to the highest quality education for the

children of our Province, and certainly, the Royal Commission Report is

entitled: Our Children - Our Future .

Mr. Speaker, in the past months, I have been talking to many

parents, to many of the stakeholders in education in this Province, and every

single person I have talked to, is committed to the highest quality of education

for their children. The position of our party is that we would not want to see

the constitutional rights of any group changed, and we therefore support all of

the efforts that can be made to promote efficiency.

We believe that structural efficiency can be achieved.

However, I do believe that the primary focus of the structural changes has to be

moved to the child, and in that regard I want to say, as I said publicly in the

last little while, that parents, elected school board officials, Home and School

Associations, parishes, teachers, all of the stakeholders, Mr. Speaker, involved

in the educational system, should be active participants. We have to stop the

secrecy that is evident in the current discussions; we have to stop meeting

behind closed doors; we have to keep in touch with the people of this Province,

and I call upon the government to begin immediately an open dialogue with all

the people so that we can have all of the participants share their views, and

through that, we will achieve, I do believe, the best quality education for our

children. We will return the focus to the child; we will promote structural

efficiency that will benefit all of us and we will have the plan put in place

that will make the road for the future in education in this Province a lot more

beneficial than it has been in the past, and I see new possibilities that might

be opened up for the dialogue.

Thank you very much.

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

MR. DECKER: Mr. Speaker, I would like to compliment the

people of St. Michael's Parish who signed this petition. I would like to

compliment them for the way in which the petition begins, where, it talks about

making sure that the best possible education that we can deliver is made

available to the children of this Province. As government and church sit down

and discuss this, and as the Opposition tries to make political points on it, it

is so easy to forget the most important person in this Province when it comes to

educational reforms.

Mr. Speaker, we are about to see some major educational

reforms, thanks to the efforts which this government has put into it over the

years - education which will benefit the children. I am going to give a message

to the hon. member to take back to the people of St. Michael's Parish. He can go

back to the people and tell them that this Administration is also committed to

protecting core denominational interests. From time to time, we all get letters.

There is a lot of concern on the part of our people. People are afraid of a

Godless, secular system of education. I, personally, am afraid of a Godless,

secular system. This Administration does not want a Godless, secular education.

All we want is the best education we can have for our children.

So the hon. member can tell the people of St. Micheal's

Parish that whatever we finish up with at the end of the day, the people of St.

Michael's Parish will have a right, as they have now, for example, for their

children to have pre-communion classes. That is a right which is cherished by

many Roman Catholic people in this Province, Mr. Speaker. Government will see

that at the end of the day they will maintain that right. We will go further. If

perchance a Roman Catholic student is attending a Protestant school, in that

Protestant school, provision will be made for the Roman Catholics to have their

pre-communion classes. That is the kind of system we are going to bring forth.

One of the rights that the churches have is the right of the

clergymen for any faith to go into the school and make available to the children

teaching according to their beliefs. Whatever the reforms will bring forward,

that right will be maintained. I ask the hon. member to go back to the people of

St. Michael's Parish and tell them that he found a willing ear, he found good

listeners in this government, because we are going to maintain core

denominational interests. Take that back to them. We are glad to send that

message back to the people.

Above all, it will be a child-centred educational system. If

something that this government is doing interferes with the right of a child in

this Province to receive the best possible education, then the government will

very quickly step out of the way. We will not stand in the way of providing a

good education to our children.

Having said all that, I can also tell the people of St.

Michael's parish, the people of this Province, that this government is bent on

making major educational reforms so that the dollar we spend will provide the

best possible education to our children - so that we can proudly say at the end

of the day that here in Newfoundland and Labrador we have the best educational

system in all of Canada, and possibly, in all the world. Thank you, Mr. Speaker.

SOME HON. MEMBERS: Hear, hear!

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

MR. FITZGERALD: Thank you, Mr. Speaker.

I thought the Premier might be in the House, and since I was

the first to speak, I thought it might give me an advantage, in starting off on

a Throne Speech rather than finishing in the afternoon and having to cut oneself

short on time. Anyway, he is not here, so I will carry on where I left off

yesterday.

MR. SPEAKER: I don't mean to interrupt the hon. member. I

thought the hon. member was presenting a petition. We didn't yet call Orders of

the Day. We are still on petitions. The previous petition had just finished. So

I ask the hon. member to resume his place and I will ask the Government House

Leader to call the Orders of the Day.

MR. FITZGERALD: I apologize, Mr. Speaker.

MR. SPEAKER: No, it's fine.

MR. ROBERTS: Mr. Speaker, I heard you call Petitions and

I assumed the hon. gentleman was presenting one. May I ask if the House could

deal first with the first readings, Sir, which are motions 1 through 24. I am in

Your Honour's hands whether it is necessary to call each one individually or

whether we can do them some other way.

Motion, the hon. the Minister of Finance to introduce the

following bills, carried:

"An Act Respecting The Newfoundland Volunteer War Service

Medal" (Bill No. 42);

"An Act To Amend The Tobacco Tax Act" (Bill No. 46);

"An Act To Amend The Income Tax Act" (Bill No. 39);

"An Act To Amend The Gasoline Tax Act" (Bill No. 25); and

"An Act To Amend The Health And Post-Secondary Education Tax

Act" (Bill No. 26).

Motion, the hon. the Minister of Municipal and Provincial

Affairs to introduce the following bills, carried:

"An Act To Amend The City Of St. John's Act" (Bill No. 34);

"An Act To Amend The City Of Corner Brook Act" (Bill No. 33);

and

"An Act To Amend The Fire Prevention Act, 1991" (Bill No. 32)

Motion, the hon. the Minister of Health to introduce the

following bills, carried:

"An Act To Amend The Chiropractors Act" (Bill No. 41);

"An Act To Amend Nursing Assistants Act" (Bill No. 44); and

"An Act To Repeal The Alcohol And Drug Dependency Commission

Act" (Bill No. 45)

Motion, the hon. the Minister of Education to introduce a

bill, "An Act To Repeal The Youth Advisory Council Act," carried. (Bill No. 38)

Motion, the hon. the Minister of Works, Services and

Transportation to introduce the following bills, carried:

"An Act To Revise The Law In The Province Respecting Rail

Service" (Bill No. 36);

"An Act To Repeal Certain Obsolete And Spent Statutes" (Bill

No. 40); and

"An Act To Amend The Highway Traffic Act" (Bill No. 37)

Motion, the hon. the Minister of Employment and Labour

Relations to introduce a bill, "An Act To Amend The Labour Relations Act,"

carried. (Bill No. 49)

Motion, the hon. the Minister of Forestry and Agriculture to

introduce a bill, "An Act To Amend The Forestry Act," carried. (Bill No. 27)

Motion, the hon. the Minister of Social Services to introduce

a bill, "An Act To Amend The Department Of Social Services Act," carried. (Bill

No. 35)

Motion, the hon. the Minister of Justice to introduce the

following bills, carried:

"An Act To Remove Anomalies And Errors In The Statute Law"

(Bill No. 50);

"An Act To Amend The Judgement Interest Act" (Bill No. 43);

"An Act To Amend The Statutes Act" (Bill No. 31);

"An Act To Amend The Residential Tenancies Act" (Bill No.

30);

"An Act To Repeal The Criminal Injuries Compensation Act"

(Bill No. 29); and

"An Act To Amend The Judicature Act" (Bill No. 28)

On motion, Bill Nos. 42, 46, 39, 25, 26, 34, 33, 32, 41, 44,

45, 38, 36, 40, 37, 49, 27, 35, 50, 43, 31, 30, 29, and 28 read a first time,

ordered read a second time on tomorrow:

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

MR. ROBERTS: Now, Mr. Speaker, if you would be good

enough to call the Address in Reply we could let the hon. gentleman from

Bonavista South resume his speech.

MR. SPEAKER: The Address in Reply; the hon. Member for

Bonavista South.

MR. FITZGERALD: Thank you, Mr. Speaker.

Being a rookie, I guess I will learn one of these days what

the Orders of the House are and when it is right and proper for me to get up or

stay sat down.

AN HON. MEMBER: (Inaudible).

MR. FITZGERALD: Thank you very much. You will learn as

well, probably.

Mr. Speaker, the incident that I was referring to yesterday

was the employee, the watchman of historic sites, employed at the two historic

centres in Bonavista, the Mockbeggar property and the Bonavista Lighthouse.

I called over to the Department of Tourism and Culture and

asked for the gentleman's job description. The job description was provided to

me, and it is pretty well a job description that you would see for any watchman

who would be employed at any historic site, but the person's duties, I might

advise the House, are completely different from what the job description

dictates.

It seems like this one individual - and it is not a personal

attack. I can assure you that I am delivering this to the House because of the

concerns that have been delivered to me by telephone calls by numerous

individuals from the community. It seems like this individual can take days off

at his own prerogative. Whenever he decides he wants a day off, whenever he

decides he wants to go to work, then he can set his own schedule.

His activities include going out and publicly advertising for

people to come to certain points in the town to pick up applications to apply

for jobs, the latest of which was done during the last provincial election, I

might add, from the Liberal headquarters.

This individual meets tour buses when they come into the

town. He meets the tour buses, joins in with the tour, and directs them to the

historic sites. There is nothing wrong with that - nothing wrong with that

whatsoever - but he takes it one step further.

I am led to believe that prior to this year there were two

restaurants in Bonavista that were capable of catering to a tour bus crowd to

come and visit the area, capable of supplying meals in one particular area. Mr.

Speaker, the owner of one particular restaurant had a few words with the

watchman, or as he calls himself, `the tour guide supervisor', and this past

year there were forty-three bus tours that visited the Town of Bonavista, and

that one restaurant owner did not receive one bus tour.

AN HON. MEMBER: (Inaudible).

MR. FITZGERALD: I have no idea what his political

affiliations are. He did not campaign for me; I can assure you of that, but he -

the restaurant owner - should not be denied the right of having a viable

business by somebody who is employed by government, Mr. Speaker. To award this

individual for his efforts in the town in this time of fiscal restraint, in this

time of government cutbacks, the gentleman has now been awarded with a company

vehicle, a government vehicle at taxpayer's expense, used on weekends, Mr.

Speaker, used for his own private tours around town. It is shameful, shameful.

How many watchmen do you know, I ask the Member for Grand Bank, who can go out

and do all those things and has his own vehicle to drive around?

AN HON. MEMBER: You used to know a great many.

MR. FITZGERALD: I do not know of any, so I call on the

minister to do an investigation into those complaints and ask that he do it now

and report back to the House, because it is shameful that those conditions are

allowed to exist today. It is political patronage and I think it is time it

stopped.

Thank you, Mr. Speaker.

MR. SPEAKER: The hon. the Member for Burgeo - Bay

d'Espoir.

MR. GILBERT: Thank you, Mr. Speaker.

I would like at this time to say a few words in the Throne

Speech debate and talk a bit about the District of Burgeo - Bay d'Espoir. It is

a district, as everybody is aware, situated on the South Coast of the Province.

In every distribution of seats the District of Burgeo - Bay d'Espoir seems to

change for some reason or other. The last time was in 1973 when it went from

Burgeo - LaPoile to the District of Burgeo - Bay d'Espoir. As I understand right

now with the Boundaries Commission we have just appointed the district will once

again disappear as a district and be changed around. There are going to be some

changes in it. I do not intend to talk about that too much today. I will be

making a presentation to the Boundaries Commission concerning this, but the

District of Burgeo Bay d'Espoir as now constituted is rather an interesting

district. You go from the extreme east where we have the only native community

on the Island part of the Province, recognized native community, Conne River,

and that in itself makes the district a little different than a normal

Newfoundland Island district. Then we have the areas from Morrisville to St.

Albans where their concerns are not normal in Newfoundland. There is no fishing

involved, no great reliance on the fishery in this area, and then, of course, we

have the coastal communities that still have very serious transportation

problems, which you know about.

On the extreme west we have the communities of Burgeo and

Ramea and I suppose I should start off and talk about Ramea, an island, nine

miles off the coast of Newfoundland. There are records of it in British history

as being there for over 500 years and being involved in the fishery. Now, this

community today is involved in a tragedy, not through any loss of life, but

their school has been totally destroyed. There is at least one house that is

destroyed and there are five or six more at the present time that are evacuated.

Now, this points out something very important. I have been in this House since

1985 and the thing I tried to point out to government, since 1985, is the fact

that communities like Ramea have to be pretty well self-sustaining because if

there is a fire, as we are finding out today, it is not the same as a fire in

the community of Conception Bay South, because if there is a fire in the

community of Conception Bay South that gets out of control there is all kinds of

equipment within fifteen to twenty minutes away that you can get for backup, but

in a community like Ramea there is no backup, so it is very important, I say to

this House, that when the Department of Municipal Affairs are looking at

requests for funding to improve the infrastructure in rural areas that it be

biased in favour of places like Ramea.

I can remember back in '86 when the previous government

started a programme of putting in compressors in the various fire departments

around the Province, and I pointed out the fact that Ramea had a unique

situation, they did not have any backup and the only place they could go to

recharge their tanks in those days was Corner Brook, and Corner Brook at that

time, was a long ways away because the road was not paved and there were times

when there was just no way of getting there. But yet that government in its

wisdom decided to put compressors in Springdale, where the most they were would

have been an hour's drive from Grand Falls, where they could have had their

tanks recharged, but the most interesting one was, they needed it in one of the

towns in the Bay of Islands, which was represented by Mr. Blanchard at the time;

they needed the compressor and that was ten minutes or fifteen minutes from

Corner Brook and yet Ramea was left out, so because of my continued harassment

of the then government, in 1988 they did put a compressor in Ramea.

Ramea now is trying to get a new fire truck and I would

imagine that this need will be looked at because the fire truck certainly needs

to be replaced. But again, in all areas of rural Newfoundland, and I say this to

the government, they should look very seriously at the needs of the areas in the

more distant places and the places that do not have the support that we have

when we are on the main line.

Now I understand from the minister that this is the current

update, the fire is now under control and only the school and one house were

destroyed. There is smoke and water damage to seven or eight houses and there

were five or six that were evacuated, so all in all, right now, we are happy to

say that this crisis is now under control in Ramea. The unfortunate part about

it is, the house that was destroyed and the person who owns that house did not

have any insurance and I am trying to get the details on it right now but there

is no insurance as I understand at this particular time.

Now as I say, that was one crisis that was averted in Ramea

today, but the serious thing in Ramea is the fact that we have records in

history going back 500 years to show that it was related to the fishery. John

Penney and Sons operated a fish plant there for over 100 years and yet the

previous federal government, when they announced a Northern Cod Package, even

though it was demonstrated by the Province, by Fishery Products International

and the fishermen's union, that the plant in Ramea did have the qualifications

to be included under the Northern Cod Package, but for some reason the then

Minister of Fisheries and Oceans, Mr. Crosbie, decided that, no, Ramea did not

qualify by virtue of the fact that the fish that was taken from Ramea to keep

the plant in Trepassey and the plant in Grand Bank and Fortune open, the fish

was taken and Ramea did not get the credit in the last year, so they used

statistics to deny the people in Ramea the right to be recognized under the

Northern Cod Programme.

Currently, the situation in Ramea is that last year FPI made

a presentation to Mr. Crosbie and they said that if the federal and provincial

governments decided to pick up the loss FPI would incur by operating Ramea last

winter, then FPI would operate the plant in Ramea and process, frozen at sea,

fish. A magnanimous offer, but I would also say that any other fish company in

Newfoundland would have operated the plant in Ramea if someone else was going to

pick up the loss, so all that this did, as far as I am concerned, was get a

gentleman by the name of John Crosbie off the hook, because there was enough

pressure on him at that time and he should have put the Ramea plant under the

Northern Cod Programme.

Right now in Ramea we are left with a programme that was

introduced in the dying days of the previous government, they closed everything

on the South Coast and the Ramea plant is now trying to figure out where it

goes. What I am saying to you is that all that is, is a bundle of confusion for

everybody involved in the South Coast fishery because nobody knows for sure what

is going to work and how this programme is going to be put in place. I

understand that there is an AIS Committee now set up to study the situation in

Ramea but I say to this House right here that the disaster today is a disaster

but it is one that we can look at and we can see what is going to happen in the

future. Unfortunately, I feel that the Ramea people were done an injustice by

the previous government by not being included in the Northern Cod Package. I am

now asking the current federal government if there is going to be a programme

extended from the Northern Cod Package see that Ramea be included in the new

programme and treated the same as everybody else.

Nine miles across from Ramea we have the community of Burgeo

which - due to again, the juggling of the figures - was included in the Northern

Cod Package and that is very good. The only thing is, by putting the Northern

Cod Package in place at Burgeo all it did was get a fellow by the name of John

Crosbie off the hook because he had given away the plant in Burgeo to Bill Barry

and his friends in Nova Scotia. The Burgeo plant was in actual fact sacrificed

so that the plant in Canso could be opened. At the time when this deal was made

the fishermen's union and the provincial government were united against this and

said that it was not a good deal. It has since been proven to be a terrible deal

and the ones who are suffering, are again, the people in Burgeo. Now they are on

the Northern Cod Package, they are there, the immediate suffering was cut down

but they are on the package and will have to pay the price like everybody else.

The unfortunate part about it is, since that time Mr. Barry has broken every one

of the rules in the agreement but all Mr. Crosbie did was slap him on the wrist

and say: it is too bad that you did it but we are not going to do anything with

you. We will just say that you did the wrong thing. I have since written the new

minister and asked him to review the whole deal. To look at it with the idea of

overturning the whole deal and going back to square one with that deal as far as

the Burgeo plant is concerned.

I was just informed this morning by the Burgeo Town Council

that Mr. Barry has now made application to get contractors to take the fuel out

of the Burgeo trawlers there and he then intends to scuttle them. So this is

some of the stuff that is going on in Burgeo. I do not think that Mr. Barry ever

has any intention of opening the Burgeo plant again. So, the problem we have is

that those two communities have down through the years, in history, been

dependent on the fishery and right now are abandoned due to the fact that the

owners have backed off and said we are not going to open the plant.

In the case of the Burgeo plant, it was a deal that was

engineered by the federal government. It is one which I think governments have

to look at, to have a serious concern about and to realize that they were

involved in the making of this deal. If Burgeo was handled the same as any other

plant - with the downgrading, the northern cod and the shortage - at least it

would be on an equal footing to start up again. What has happened because of the

decision that was made by the federal government, to barter Burgeo away for

Canso, there is no provision right now and Burgeo is in a desperate situation.

So I am asking the new government to look at both Burgeo and Ramea as special

cases and as communities that have been, since the history of Newfoundland,

involved in the fishery. The only reason that we are there is because of the

fishery - because I can assure you if you have not been to Burgeo or Ramea go

down and have a look. When you have a look you will realize that their ancestors

and our ancestors that settled there, did not settle to go farming. It was a

fishing community and that is completely what it was. There was no other reason

for the communities of Burgeo and Ramea to exist.

Now when we go into the coastal part of that district, as I

like to call it, Grey River, Franois and McCallum -, those communities were

basically there because of the inshore fishery. Where fellows could fish in a

twenty-foot boat and fish by themselves and go out and catch fish all year long.

Right off the coast. They didn't have to go a mile or two outside of the

harbour. They made a living all their lives.

In the ten years since I've been the member down there those

fishermen have been saying to me: Look, there's a problem. We're not catching as

much fish as we were last year. We're using more gear, we're using more effort,

and we're not getting any fish. This has gone on for ten years. Every year I've

stood here in the House of Assembly. I've talked about the shortage of fish,

I've talked about the problems of the inshore fishermen on the South Coast, and

nobody has listened.

Last year, or two years ago, when the Northern Cod Package

was announced for the people on the Northeast Coast of this Province, I pointed

out to the federal government: Look, this is a political move. Those people who

are fishing on the Northeast Coast, they are there, but there's 15,000 of them

compared to the 2,000 who are on the South Coast. The South Coast of this

Province is in as big a disaster area and there's just as much a shortage of

fish on the South Coast as there is on the Northeast Coast. The only difference

was that the normal Northeast Coast fishery that most of us know about was the

Northeast Coast fishery that went on, at the most, maybe three to four months.

That was the extent of the Northeast Coast fishery. Where the fishery on the

South Coast was a twelve-month fishery. It was never recognized to be the only

source of income on that coast.

The Northeast Coast fishery was one where people had traps

out there. They did their trap fishery. Back thirty years ago they dried the

fish and sold them, and then they went on to do something else for the other

eight months of the year. The South Coast, they had nowhere else to go. They

didn't have any farms. They didn't have anything else. They had fished ten to

twelve months of the year.

These people have been saying that for the ten years that I

have represented them. They were left out of the Northern Cod Package. Yet again

this year, when the federal government announced the programme in September,

closing down the fishery on the South Coast, recognizing that there was a

problem there, again it was one that did nothing at all for the inshore

fishermen along the South Coast. As I said before, it was a bundle of confusion

and frustration for the people who were there.

Just imagine. If you're a fisherman in Franois and you had

your ten stamps when the fishery was closed, you could get $300 a week up until

your unemployment kicked in in November. However, if you only had seven stamps,

and you needed three more stamps, you had to wait until November - no income

coming in - till the government put together a make-work package so you could go

out and get three stamps to get your unemployment.

AN HON. MEMBER: (Inaudible).

MR. GILBERT: That's the problem. That this programme was

again mishandled and ill thought out by a federal government that controls the

fishery. Again it makes a point for the joint management of the fishery as the

Premier is saying. It's another reason why we should have some say in the

fishery in Newfoundland instead of having some bureaucrat in Ottawa making a

decision that's going to affect the lives of those hard-working fishermen along

the South Coast of this Province.

AN HON. MEMBER: (Inaudible).

MR. GILBERT: That's right. In the District of Burgeo -

Bay d'Espoir there's that distinction right now. They're there. There's these

many communities that are totally dependent on the fishery. Then we go into a

part of the District where there's nothing relating one side of the District to

the other. It's farther for me to go from Milltown to Burgeo than it is to drive

between Toronto and Montreal. It's over 650 kilometres to service both sides of

that district. When I said when I started off that the boundary was going to be

assessed again I'm saying yes, possibly it has to be. I agree.

Because once we go into the other side of that District we

have nothing at all in common with the coastal part of it - McCallum, Franois,

Grey River, Burgeo, Ramea. We're now into the St. Alban's, Morrisville area of

that District that traditionally depended on sawmills and lumbering. I've talked

to people down there. Leonard Long is a gentleman who is about eighty-five years

old. They tell me he used to have a coaster. For years he made his living taking

loads of lumber and spars and stuff like that out of the Bay d'Espoir area and

taking it to Grand Bank and St. Pierre and Placentia Bay. Thats where they built

the bankers and the boats with lumber and materials from Bay d'Espoir.

He also told me that prior to Confederation he used to take

boat loads of produce out of there in the fall of the year, potatoes, turnips

and cabbage, the stuff we used to grow in Newfoundland and sell it on the coast.

But he also told me that ten years after Confederation he was bringing it in

from PEI, so you know there is potential there that I think we are missing in

some areas, when you take into consideration that this was an area where there

was an agricultural industry prior to Confederation and it has disappeared. Our

saw mills have disappeared and gone the way of the grey goose.

The federal government did have a good program a few years

ago, the Forest Economic Stimulus Program and that disappeared when the previous

government came in in '84. We had a new agreement, it was signed, the Leader of

the Opposition went up in 1984 I think - I was here in the House in '85 - and he

came back and said he had a lovely time and he had a cup of tea with Mr.

Merrithew and they had a good agreement.

Now some of us who were here at that time did not think it

was a good agreement, I did not think it was, however, this agreement is about

over and I am sure that we will be negotiating another forestry agreement which

will possibly do something to keep the forestry industry going in Bay d'Espoir,

because it is one of the things that has to operate in Bay d'Espoir to fit in to

the economic scheme of things. We cannot forget the forestry, it is there.

Now, one of the interesting things, last week, with all this

talk about Hydro and the privatization of Hydro, the only place in Newfoundland

that I suppose is solely dependent on Hydro would be Bay d'Espoir. It is one of

the major things. As the saw mills and the export wood went down, the thing that

went in in the 60s was Hydro. The Liberal government built it with the

expectation that there would be need; they were criticized at the time they

built it and now we realize how important that decision was.

I was in Bay d'Espoir last week and I expected when I went

down because I had heard - you know I had the meetings here and I knew what was

intended - well I had heard the media, I had heard the hype, I had heard the

Opposition and I was expecting that they would have been waiting to lynch me

when I went to Bay d'Espoir last week. I was expecting they were going to be

there with the ropes and that I was going to be in trouble, so I had the

Premier's speech and I went down and went to the meetings - I had arranged

meetings with all the town councils there and one of them had started to pass a

motion saying they were against the privatization of Hydro.

It had not been passed but when I had the meeting with them

and I gave them the Premier's speech and said: now, look at this, I respect

where you are coming from - and the main concern that I found in Bay d'Espoir

last week, a place that is dependent on Hydro, the ones who were most concerned

were the employees, who did not know what was going to happen - were they going

to lose their jobs? Now this is something that I can understand, anyone in this

House can understand that if you are in a position where there is going to be

something happening and you are possibly going to lose your job, you are going

to be concerned. Everybody is going to be concerned and as I pointed out to the

Mayor of Milltown, who is an employee of Hydro and certainly would have serious

concerns, I said: look, I agree with you. If I were in a situation where my job

was contingent on the privatization of this thing, I would be concerned. But

after they looked at what the Premier said, they said they were certainly going

to study it and would be taking into consideration that this was a situation

that maybe was not all bad. This was something they had to look at.

I then went to St. Albans and had a meeting with the town

council in St. Albans and the Mayor of St. Albans tells me I can quote him on

this - he is a temporary employee with Hydro and he said: you know, I think that

Hydro could be managed a lot better than it has been. He said: when I was

working with Hydro, if I were on the West Coast and was coming back in the

evenings, and if I got to the Burnt Berry Motel at five o'clock, I was told to

stop, because they did not want to pay overtime for the next four hours if I had

to drive home, but stop, and stay overnight at Burnt Berry, which meant that

they paid for my meal, they paid for my room overnight, my breakfast the next

day and instead of my being back to go to work the next morning at eight

o'clock, I was not back until one o'clock. That was the attitude that Hydro had

and I think there is a better way of managing it. He said: I really feel that

there is a problem.

I've also, if you want to go back to the record, I told a

story like that once here when I was in Opposition during the Committee stages

about the two truck drivers down in Bay d'Espoir who were telling a story about

having to stay overnight. So this not an uncommon thing, but it's a thing that -

here's a former employee who can make statements like that. Generally what I

found in Bay d'Espoir was the majority of people who I talked to in Bay d'Espoir

felt that there was a much better way to manage Hydro than the way that it's

done right now.

When I hear Mr. Abery say that he's for keeping Hydro as it

is, I suppose he is. I can remember five years fighting this battle here in the

House of Assembly about moving the control centre from Bay d'Espoir to St.

John's. I had Mr. Abery admit here in this House one time in a committee meeting

that: yes, you could operate the control centre from Halifax or even from the

moon. But it was used, that was the reason that was used, to build that building

here in St. John's.

Now I tell you, if anyone wants to see an example of waste in

Newfoundland, just come and drive out over Columbus Drive. The most expensive

building in Newfoundland, the most expensive office building in the world, is

right there on Columbus Drive, right there, and it's put there on the backs of

the Newfoundlanders and on the backs of the employees in Bay d'Espoir.

SOME HON. MEMBERS: Hear, hear!

MR. GILBERT: So when I hear people say that they don't

want to be involved in the merger of Hydro and Fortis, I'm telling you right

now, there's enough - you can look around - there are ways that the Newfoundland

taxpayer is going to save a lot of money. I will say to you, ask Mr. Abery now.

The next time you go out you look at that building. The top floor of that

building, that building -

AN HON. MEMBER: (Inaudible).

MR. GILBERT: Now, my friend, just a minute, I'll talk to

you. I'll get to that. Just let me talk about your friend Mr. Abery first. Don't

interrupt this, this is too good, I've been waiting for years to say this.

SOME HON. MEMBERS: Hear, hear!

MR. GILBERT: You look at the top floor of that Hydro

building there. You'll see there are all little square glasses in the middle of

that.

AN HON. MEMBER: Just like the Taj Mahal.

MR. GILBERT: When that was built, that building was

originally built to be a totally air-conditioned building, with no access for

windows on the outside. Mr. Abery went in there, and you ask Mr. Abery the next

time he gets up and says he doesn't want to privatize Hydro, ask him about how

he went up to the building and had a look at it. He went into his office. What,

no window? By God, there'd better be. You ask him what it cost to put in the

windows all around that building. Somewhere around a million dollars of

taxpayers' money that Mr. Abery spent after one visit to his building when it

was built.

AN HON. MEMBER: One fell swoop.

MR. GILBERT: One fell swoop, as my friend says, yes. So

don't tell me about Mr. Abery being the salvation of Newfoundland Hydro when

that goes on. So let me tell you right now that if there is room, I am prepared.

As to my friend in Bay d'Espoir, one of the best supporters I had, I might say,

I had to say to him: Listen, in the world we're living in right now today, if

jobs are inefficient, as much as we'd like to keep them, we can't keep them.

This is it. If there's a better way to do it, by God let's find it and spend the

money somewhere else. That's the way it has to be done.

I think I'm finished with Hydro now. I'll talk some more

later on. Before I finish off I have a concern I have to raise. I'm sorry that

my friend the Minister of Works, Services and Transportation is not here.

Because it's one concerning the community of Conne River.

As I said when I started off, Conne River is an anomaly in

the Province. It's an Indian community and it's handled under the Indian Act. It

deals directly with the Province for its health and welfare. The Province

doesn't contribute to that. It's handled by federal money.

AN HON. MEMBER: (Inaudible).

MR. GILBERT: Yes, the supplement, yes, okay, I'll agree

with that but by and large, it's federally funded.

MR. ROBERTS: Yes, they get assistance. For example, we

provide police there but they get extra....

MR. GILBERT: They get extra. You provide police, but I

mean normally I would say that Conne River is self-sufficient, more than the

community of Milltown, shall we say.

AN HON. MEMBER: (Inaudible).

MR. GILBERT: Alright. That is right; it does. Maybe that

is why Conne River has grown by 22 per cent. Since 1985 the population in Conne

River has increased 22 per cent.

Now, my concern is the fact that the three miles that the

community of Conne River is situated on is governed by the band council and

pretty well self-sufficient, but I have a concern. There is a road, a trail,

going to that boundary. It was an old logging road that was put in in the

seventies, and every year there has been an effort to try and get this road

improved. The people of Conne River have been in negotiation with the federal

government and the Province to do something about it. I say, in this House, that

road is a provincial road, to the boundary of Conne River, and all I am asking

right now is that it be considered as such and that it be upgraded - if it is

not paved this year, at least be brought up to normal upgrading. There are more

than 680 people living in Conne River right now and I would say, without

contradiction, without being contradicted here in this House, that the road

going to Conne River is possibly the worst road to any community in the Province

right now, and I am asking that the government have a serious look at upgrading

the road to Conne River.

With that, Mr. Speaker, thank you, and I will sit down and

let someone else carry on.

SOME HON. MEMBERS: Hear, hear!

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

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

I might add, to my hon. friend from Burgeo - Bay d'Espoir,

that Hydro may have the most expensive building at taxpayers' expense, but we on

this side of the House know where the most expensive doorknobs are, at

taxpayers' expense.

SOME HON. MEMBERS: (Inaudible).

MR. SPEAKER: Order, please!

The Chair has recognized the hon. Member for Kilbride.

MR. E. BYRNE: Mr. Speaker, if we in this Province are

going to have any hope of prosperity, any hope of being an industrious people,

then we must begin today to pursue a sound policy of resource management and

human resource management - something that this government is not doing, in my

opinion.

SOME HON. MEMBERS: Hear, hear!

MR. E. BYRNE: We must seize the assets that we now have,

seize the assets of our people, the assets of Newfoundlanders and Labradorians,

and we must have further control over the development of those resources in many

areas - forestry and agriculture, mining and energy, fisheries management, and

indeed hydroelectric power.

Now I would like to address some of my remarks initially to

the Member for Bonavista South who provided an eloquent historical lesson and

history lesson yesterday on the Upper Churchill and how, at that time in

history, it was the best thing since sliced bread, I believe he said yesterday,

but let me assure the member - and before I go on, he also said that he was

working there while some of us on this side of the House were playing marbles,

or something like that, he said. Let me assure the Member for Bonavista South -

AN HON. MEMBER: St. John's South.

MR. E. BYRNE: St. John's South, I am sorry - that to him

and the generation that he represents, Upper Churchill may have been a great

project, but to the generation that I represent it is a project of failure and a

project of mistakes, and the only people benefitting from that project today are

Hydro Quebec and the people living in Quebec, and that is something that we must

not make again, a mistake that we must not make again.

Now on the fundamental principle -

AN HON. MEMBER: (Inaudible).

MR. E. BYRNE: Mr. Murphy, on the fundamental - my hon.

friend, Tom Murphy from St. John's South -

MR. SPEAKER: Order, please!

I remind the hon. Member that he is to refer to hon. members

of this House by the district that they represent.

MR. E. BYRNE: I apologize.

To my hon. friend from St. John's South, yesterday he got

into a discussion about Hydro and the whole need for privatization of government

services that the private sector can better deliver, and fundamentally I agree

with the man, and generally speaking I agree that government, where government

is providing services to people of this Province, that they should not interfere

with the private sector; however, in the Hydro case we are talking about a

resource that belongs now to the people of this Province, to the people of his

district, to the people of the Province in general, and I fundamentally disagree

that any merger or sale of the assets of Hydro to the private sector will

benefit, in the long run, the people of this Province and the consumers.

AN HON. MEMBER: (Inaudible).

MR. E. BYRNE: The Premier indicated in an interview in a

scrum yesterday how despicable the members of the Opposition were because we

were charging that Newfoundland and Labrador Hydro, in a merger that we

fundamentally disagree with, how despicable we were in putting forward our own

motives. Selfish motives he said, and my answer to that is how despicable a

member of this House is to assume, because I or our party disagree with him on

fundamental principles, that he has the right to call me despicable as a member

of this House of Assembly. That is what is despicable and not me, not the

members of this House, who fundamentally agree on a point of principle, that the

sale of Hydro, the merger of Hydro is wrong.

There will be no increase of jobs. In fact there will be a

net loss of jobs. There is no technological transfer in terms of this sale or

merger of Hydro. It will bring no new industry and no new investment to the

people of this Province. What we will see in the final analysis is an increase

in taxes for the average consumer. That is what we will see. The Premier has

admitted that. The Premier said that over a period of five years there would be

a minimal increase of 1 per cent per year. How can the Premier or any member of

this House dictate what a private company in the private sector, what rate

increases they will provide to the average consumer in this Province? I ask the

Member for Pleasantville and the Member for St. George's if their constituents

will collectively benefit from this sale? I say they will not benefit from this

sale and that in the final analysis we will lose control of a major resource and

we will lose in-house expertise that has been developed over twenty years in

terms of the engineers of Newfoundland Hydro. It will not in the final analysis

be a good sale and a good deal for the people of this Province.

In terms of forestry and agriculture as a renewable resource,

supposedly, we are not seeing any proper planning or any foresight demonstrated

on the part of this government or on the part of the Minister of Forestry and

Agriculture. In the May Budget we saw the hog industry's legs cut out from under

it. Swine breeding stations and subsidies to hog producers were eliminated but

yet in late August or September, I say to my hon. friend for St. John's South,

in Cabinet, a decision was made to sell the swine breeding station in Portugal

Cove to private interests without offering to those involved in the industry,

who had been adversely affected by government decision making, a chance to buy

that station. There was no public tender whatsoever on the swine breeding

station and a decision was made in Cabinet to sell it to private interests. I do

not believe the people of the Province were best served by that.

What is happening in our forestry industry today? There is a

rape and a pillage happening in the forestry industry of this Province that can

be compared to what has taken place in the fishery over the last ten years. My

hon. friend for Baie Verte - White Bay asked the minister in the last sitting

how many harvesters are operating in the forest industries in this Province

today and he could not provide one answer. He could not say there was one, ten,

twenty or one hundred. He did not know.

MS. VERGE: There was no environmental assessment.

MR. E. BYRNE: Exactly. There was no environmental

assessment, no assessment of the impact these harvesters are having on the

entire forestry industry, and in the long run what the impact will be on the

jobs in the industry as a whole. He could not provide an answer and more than

that, did not want to, and will not provide an answer. With respect to the oil

and gas industry and the resource that we supposedly own and control. This

summer we saw a large contract go to interests outside this Province, a contract

that would have provided hundreds of jobs, but more than that the biggest stake

and the biggest thing we lost in the loss of that contract was the transfer of

technology, the opportunity for people in this Province and for this Province to

become a centre in terms of oil and gas development, but we lost. What was the

response from the Minister of Industry, Trade and Technology and the Minister of

Mines and Energy? At the end of the day our pencils were not sharp enough.

Frankly I think that was an excuse and something that we, as people in this

Province, should not stand for.

In terms of our most valuable and renewable resource, the

fisheries, where is the plan being articulated by this government? The plan for

the future. What will the inshore fishery look like in the future? Who will be

involved in prosecuting that fishery? What skills do they have to have to

prosecute that fishery? Will there be an offshore effort? Will there be a

concentrated offshore effort as we have seen in the last ten years? Those are

answers that are not forthcoming from this government but are answers that

should be forthcoming. Has the Province seized control over what is happening

with retraining in terms of the fishery and those affected by the fishery? Again

I put forward that there was no plan, there was no human resource plan by this

Province that will see the benefits of a sustainable fishery in the future

coming back to us.

In terms of human resource development, the Premier and his

ministers so eloquently stood up and said: we have a strategic economic plan for

the development of the Province. A strategic economic plan that twenty years

from now will put this Province on the course to recovery. Well I would suggest

that there are major holes in the strategic economic plan, especially dealing in

those areas of development of our people and human resource development. A good

example of planning that did not take place is the present Emergency Employment

Programme. The $6 million announced, I think everybody was in agreement,

including the minister, that it was not enough because of scarce resources.

MS. VERGE: (Inaudible).

MR. E. BYRNE: That is true, it was not even $6 million.

It was actually $2 million but the perception was given that it was $6 million.

In the St. John's region for example, his Emergency

Employment Program actually drove the number of weeks from eleven weeks up to

twelve weeks, putting the plan itself out of business in this region. By the St.

John's region I mean as far as Seal Cove, all of Mount Scio - Bell Island

region, the region of the Province that CEIC deals with. In the St. John's area

there was a little over $600,000 or almost $600,000 allotted. The total number

of insurable weeks was 1559 insurable weeks. If everybody needed eleven weeks

that would have meant that there would have been 149 jobs in that region but the

reality is that eleven weeks will do four, three, two, five people possibly who

are short of UI. Now here is what has happened, confirmed by officials at CEIC

and confirmed by Statistics Canada. In September, prior to this plan being

announced, there were 12,000 people unemployed in the St. John's region while

there were 83,000 people who were in the labour force between October 7th and

November 7th, when the number of insurable weeks in the St. John's region was up

from eleven to twelve.

There remained 83,000 people in the labour force but there

was a drop of 1,000 people in those unemployed. It dropped from 14.4 per cent to

13.5 per cent and that drop of 1,000 people caused the number of weeks required

to qualify for UI to rise from eleven to twelve weeks.

Now we have the question, what was the impact of the

Emergency Employment Program on that? Statistics Canada and CEIC confirm that

any provincial programme and people employed under the provincial programme

would show up in their statistics and be counted towards those who would be

unemployed, or the converse being, to those who would be employed. But the real

factor and the real figure is this, according to Statistics Canada it would only

have taken a .6 per cent drop, which actually is 400-500 people employed in the

region, to cause that eleven weeks to rise to twelve weeks.

Now, in the St. John's region, I would put forward that there

are probably between 300 and 500 people who got assistance from the Emergency

Employment Programme. Thus that programme contributed in a major way to the

number of weeks rising from eleven to twelve. There was no prior discussion with

the minister and CEIC, absolutely no discussion, about the impact that this

programme would have on the insurable weeks in this region. None whatsoever.

Not only those people who were affected and who were employed

on the Emergency Employment Program, not only do they now not qualify for UI,

which was what the Emergency Program was supposed to do, but all of those other

areas, indirectly, in other sectors of our economy, who live in that St. John's

region, were adversely affected, and are adversely affected, because of a

provincial government program which was designed to assist on the one hand, but

which has put itself out of business on the other hand.

My colleague for Waterford - Kenmount spoke to me this

morning and said one project in Barachois Street, for example, needs an extra

eleven weeks because of the change from eleven to twelve. The Goulds recreation

commission needs an extra -

AN HON. MEMBER: (Inaudible)?

MR. E. BYRNE: Pardon me?

AN HON. MEMBER: Needs an extra eleven weeks because of

the change (inaudible)?

MR. E. BYRNE: In Barachois, yes it does. The Goulds

recreation commission, it had employable weeks for nine persons, or eight

persons. They now need an extra twelve weeks. The Goulds agricultural society

needs an extra fifteen weeks to accommodate those so they can get on UI. These

are only three examples. I would suggest to my friend, the hon. Member for St.

John's South, that he should check with those people receiving funding in his

area, if he hasn't already, to see if -

MR. MURPHY: No boy, I'm sitting on my hands.

SOME HON. MEMBERS: Oh, oh!

MR. MURPHY: Go up on Shea Heights and have a look.

MR. E. BYRNE: This is the effect the Emergency Employment

Programme had on this region.

Mr. Speaker, the adverse effects of government policy, or

lack thereof of this government, have been felt in my district since 1989. This

year the City of St. John's in putting forward its criteria or its list of those

areas that they wish to see increased city services in water and sewer, in

pavement, put forward that to the Minister of Municipal and Provincial Affairs.

What happened? One of the designated areas that the city put forward was

increased monies. They actually earmarked an amount of money for the District of

Kilbride. The Minister of Municipal and Provincial Affairs did not accept that

should be a District that gets any money. What happened instead? He insisted

that Elizabeth Avenue should be repaved and that the people on Petty Harbour

Road not receive water and sewer, and that the raw sewage that's running in the

ditches up there not be corrected. That's the type of effects that's been felt

by this government.

The downloading itself of amalgamation, the downloading of

responsibilities onto the municipalities. Over 60 per cent to 70 per cent of my

District, the District that I represent and that people have put me here to

represent them, their taxes have increased three-fold. In some cases four-fold.

AN HON. MEMBER: So they should.

MR. E. BYRNE: So they should? Pardon me?

AN HON. MEMBER: (Inaudible).

MR. E. BYRNE: That is not true, sir. They were paying

something before. They were paying their fair share, is what they were paying

before. What are they getting now? They are not getting one extra service for

four times the taxes, while the people in around the area enjoy much greater

taxes, much greater services, and they are receiving nothing because of

amalgamation!

SOME HON. MEMBERS: Hear, hear!

MR. E. BYRNE: Before they were a municipality that could

have survived quite capably on their own, given half the chance and the

opportunity. They were not given that chance and they were not provided with

that opportunity. That's what amalgamation has done to the people of my

District.

SOME HON. MEMBERS: Oh, oh!

AN HON. MEMBER: Tell the truth!

MR. E. BYRNE: I am telling the truth. Amalgamation. We

don't call it amalgamation now, I think the minister has called it

regionalization. Regionalization of services. It has had no great impact, only

adverse impact, to the District of Kilbride.

AN HON. MEMBER: (Inaudible).

MR. E. BYRNE: Pardon me?

AN HON. MEMBER: Five years down the road (inaudible).

MR. E. BYRNE: I sincerely doubt it, sir.

SOME HON. MEMBERS: Oh, oh!

MR. SPEAKER: Order, please!

MR. E. BYRNE: Mr. Speaker, amalgamation and municipal

services are of great, great concern to the people in Kilbride, to over 70 per

cent of the District of Kilbride.

Since 1989 there has been little or no money put into that

district - little money put into that district - for the upgrading of roads. Go

in the main Bay Bulls road right now, which is a district that serves 15,000

people, mind you - not 2,000; not 1,000; not 400; 15,000 people it serves - a

major area and a growth centre for the region here. Only a cow path, that is

what I would call the main Bay Bulls road. It is a cow path. From 8:00 a.m. to

9:00 a.m. it is bumper to bumper. From 4:00 p.m. to 8:00 p.m. it is bumper to

bumper.

MR. MURPHY: Well I say to the hon. member the previous

administration were responsible for the road.

MR. E. BYRNE: Let me tell you about the previous

administration, my friend from St. John's South. On average the Goulds

municipality received $750,000 to $1 million a year from the previous

administration. It certainly hasn't seen that from this administration. I can

guarantee you that, Sir. I can guarantee you that.

SOME HON. MEMBERS: Hear, hear!

MR. MURPHY: What did they spend it on?

MR. E. BYRNE: They spent it on water and sewer, and

upgrading the town's facilities - something we have not seen from this

government - I can tell you that - and that we won't see from this government.

MR. MURPHY: (Inaudible).

MR. E. BYRNE: Let me tell you, Sir, the mil rate now is

the same as the residents of St. John's, and we have not seen any extra services

- no extra services whatsoever, because Municipal Affairs here is earmarking

funds for its own districts, not for districts that are in more of a need. That

is what is happening here.

I say to my hon. friends across -

SOME HON. MEMBERS: Oh, oh!

MR. SPEAKER: Order, please!

MR. E. BYRNE: I did not quite hear the hon. Member for

St. John's South about the projects for my district.

AN HON. MEMBER: (Inaudible).

MR. E. BYRNE: Oh, I am sorry, Sir.

I say to the hon. members of the House of Assembly here that

I would like to return to Hydro for one minute and to investigate The Evening

Telegram and `The Liberal Rag' is what it is. That is all I could call it.

It is a Liberal Rag. Bill Callahan - I am sure that the Premier's Press

Secretary writes all of Callahan's articles in `The Way We Are'. `According To

The Book Of Clyde'. That is what it should be called.

Last week in an

article in `The Way We Are' by Mr. Callahan,

he indicated that there were thousands of people in the Province enjoying good

pensions; thousands were represented by powerful, powerful public sector unions,

with lots of money, and that the people of Newfoundland would rush to buy shares

in a new merged company. Now I ask you, in all honesty and sincerity, my friend

from St. John's South, are the people in his district, from Shea Heights, from

Patrick Street, are these people going to rush to buy shares? What about the

people in Codroy Valley? Will they rush to buy shares? Will the people in Terra

Nova, or the people in Kilbride? They are fighting every day to put food on the

table. Loss of jobs, loss of hope, that is what this government has delivered,

and nothing else.

Now what has the government provided in terms of another

human resource - young people, education? What have we seen at the university

since 1989? We have seen increased tuition with no increase in student aid. We

have seen budgetary cuts to Memorial, which services all of our districts, and

to young people coming in there. We have seen increased youth unemployment and

cutbacks in youth student employment programmes and youth employment programmes.

That is what we have seen. We have seen the student/teacher ratio rise, not

decline. That is what we have seen, and if that is the way that this government

attempts to mask its own ability in terms of 'we are doing what we can for the

young people', they are doing nothing for young people.

What is needed in this Province today, and I call for it here

today, is a commission on youth unemployment, a commission on youth

opportunities, that would travel the Province to investigate what has happened

in the last five to seven years. That has not happened but this government must

make it happen.

I am going to clue up by saying this, one of these days

somebody may come forward and ask all of us here to come together on specific

issues, youth unemployment, specifically, and I think we must put away our

political swords and respond to such a situation and deal with what is, not what

is politically right or wrong, or what it is politically correct to do. That is

what we must do. We must work towards, and work together, in solving that

problem because there is no government programme providing opportunities to the

youth of this Province. It is certainly not happening in my district. There are

no opportunities for them. Ernest Hemingway once said: For whom the bell tolls.

AN HON. MEMBER: (Inaudible)

MR. E. BYRNE: Exactly. That is a lesson you people could

learn over there, the government members, the members of the House of Assembly

who represent the government, because they have been asking for whom the bell

tolls. I guarantee you this, the bell does not toll for me, Sir, I can guarantee

you that, but the bell tolls for the people of this Province, and how people are

adversely affected in Marystown affects me, how people are adversely affected on

the Northern Peninsula affects me, and I think that is a lesson that the members

of government should take, should heed, and the next election we will not be

asking for whom the bell tolls because it will not be for the Member for

Kilbride, Sir, it will be for the Member for Gander because we have a boy for

you.

Thank you, Mr. Speaker.

MR. SPEAKER: Order, please!

The hon. the Member for Stephenville.

MR. AYLWARD: Thank you, Mr. Speaker. It was a pleasure to

listen to the member opposite. I welcome the new Member for Kilbride to the

House of Assembly. He was a good President of the Student Union and I wish him a

good future in political life in Newfoundland and Labrador. I remember him in

university days. I think the Member for Eagle River, he and I, probably shared a

scattered political debate and I expect we are going to share another one in the

next three or four years. A warm welcome to you, Sir.

AN HON. MEMBER: Was he a Liberal then?

MR. AYLWARD: I am not sure. No, he was not a Liberal

then. We all go astray sometime in life but he speaks with conviction and it is

good to hear an opposition member speak with conviction.

Mr. Speaker, the topic today is our red book, the Throne

Speech. I was listening intently to the member on the other side and in many

ways he is very right. I like to give credit to people who speak with conviction

and speak about how we address the concerns in this Province. When he was

talking about what we are going to do for young people, and how we are going to

address the future, he is right when he says we are going to leave a legacy, but

right now we have a real darn legacy to deal with that has been left this

government here. We have been left with a legacy of a tremendous amount of debt

which we could if we wanted to get political blame the other side for because

most of it came while they were in government. I can remember being in

opposition for four years, in my younger years, and I would get up and ask the

government of the day, which is the other side now, questions and they would

blame Churchill Falls for everything again, that was twenty-five years ago. All

I say is, let us be realistic about what we have to deal with today, what the

future holds, and let us plan for the future. I look forward to the ongoing

debate that we are going to see on these issues because a lot has to be done and

we all have to work collectively to make it happen, because if we do not, Mr.

Speaker, what might happen is that the people may decide we are no longer able

to govern, and should not govern, something like they just did up in Ottawa.

AN HON. MEM