December 14, 2010 HOUSE OF ASSEMBLY PROCEEDINGS

Vol. XLVI No. 49

The House met at 1:30 p.m.

MR. SPEAKER (Fitzgerald): Order, please!

Admit visitors.

Today the Chair would like to welcome three members of the provincial

government's youth leadership team for the Youth Retention and Attraction

Strategy who are present in our public galleries. Present today are Mr. Adam

Vickers, Chris Sheppard, and Colin Corcoran.

Welcome to the House of Assembly.

SOME HON. MEMBERS: Hear, hear!

Statements by Members

MR. SPEAKER: The following members' statements will be heard: the hon.

the Member for the District of Ferryland; the hon. Member for the District of

Bellevue; the hon. Member for the District of Baie Verte-Springdale; the hon.

Member for the District of Terra Nova; and, the hon. Member for the District of

St. John's West.

The hon. the Member for the District of Ferryland.

SOME HON. MEMBERS: Hear, hear!

MR. HUTCHINGS: Thank you, Mr. Speaker.

I rise today to congratulate and commend the Southern Shore Folk Arts Council

on another successful Shamrock Festival. On the weekend of July 24, 2010, I had

the pleasure of attending this two-day event.

This year marked the twenty-fifth anniversary of the festival. The Annual

Southern Shore Folk Festival was started in 1986. In 1995, the Folk Arts Council

re-focused the festival to take on a more traditional Newfoundland-Irish

flavour. From those efforts was born the Shamrock Festival.

The festival has attracted great interest from both musicians and the public

alike, and has achieved significant growth since its inception. In 2005, a youth

session was introduced at the start of the festival, and as well a songwriters

circle was added. Annual improvements to the festival site, combined with an

outstanding lineup of performers, positions the Shamrock Festival as one of the

top music festivals on the Island.

The festival offers a venue for amateur and professional musicians to

perform. Although the main event is the performance on stage, there are various

other services and attractions for young and old alike to experience and enjoy

the festival on the grounds.

The Southern Shore Folk Arts Council is a non-profit organization operated by

a volunteer board of directors committed to preserving and promoting the unique

culture and heritage of the Irish Loop region. Further accomplishments of the

council include the restoration of the historic Kavanagh Premises Building,

which now houses a new dinner theatre venue for the region, and ongoing

development of a Regional Arts Centre.

Mr. Speaker, I ask all hon. members to join me in congratulating the Southern

Shore Folk Arts Council on the tremendous work they have done, and are

continuing to do to promote and showcase the unique heritage of the Irish Loop

region.

Thank you, Mr. Speaker.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The hon. the Member for the District of Bellevue.

SOME HON. MEMBERS: Hear, hear!

MR. PEACH: Thank you, Mr. Speaker.

It gives me a great privilege to stand in this hon. House and congratulate

the Tricentia Timberwolves 3A Seniors Boys Volleyball team on a very successful

year of events.

The 3A Seniors Boys Volleyball team hosted the provincial tournament this

past weekend. The tournament was a 3A senior volleyball School Sports

Newfoundland and Labrador. Nine teams in total attended from across the

Province, and the Timberwolves won all of the games, Mr. Speaker.

There were other tournaments throughout the year such as the regionals, the

Boys B Volley Fest Newfoundland and Labrador, and the Kerry Clarke Memorial

Tournament, and the Timberwolves won all of those as well; a clean sweep, I

might say.

Mr. Speaker, the driver in all their success was that they dedicated their

volleyball year to Kerry Clarke, a teacher who passed away at the end of the

previous school year.

Mr. Speaker, I ask all hon. members of the House to join me in congratulating

the Tricentia Timberwolves on a great successful sports year.

Thank you, Mr. Speaker.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The hon. the Member for the District of Bay

Verte-Springdale.

SOME HON. MEMBERS: Hear, hear!

MR. POLLARD: Thank you, Mr. Speaker.

As I rise in this hon. House today, I am beaming with pride as I relay my

congratulations to the manager of the Anaconda Pine Cove Gold Mine on the Baie

Verte Peninsula, Mr. Allan Cramm.

At the 2010 Mineral Resources Review, Mr. Cramm was named the Developer/Miner

of the Year, which is awarded by the Canadian Institute of Mining Newfoundland

branch. This award is presented to a company, team, or an individual that has

made significant progress in advancing a mine or mine expansion toward

production; or for a significant contribution to health and safety,

environmental stewardship, or commitment to a community; or for innovation in

the Newfoundland and Labrador mining industry.

With great expertise, perseverance, and patience, Mr. Cramm and his highly

skilled team faced and overcame several technical challenges. They are to be

commended for successfully bringing the mine to commercial production in May of

2008, creating nearly fifty new jobs in the area. This is a tremendous feat, Mr.

Speaker, when one considers that they started from scratch and it is fully

environmentally compliant.

Honourable colleagues, please join me in saluting Allan and his team for this

extraordinary achievement and in wishing them every success as they continue to

maximize the mine's potential.

Thank you, Mr. Speaker.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The hon. the Member for the District of Terra Nova.

SOME HON. MEMBERS: Hear, hear!

MR. S. COLLINS: Mr. Speaker, I rise today to recognize a remarkable

gentleman from my district, Colonel Don Winsor. Colonel Winsor was born in

Wesleyville and later raised in St. John's. Following the completion of high

school he joined the Royal Canadian Air Force and served as an electrical

technician, after which he went on to receive his teaching certificate from

Memorial University.

Colonel Winsor would later be employed by the Iron Ore Company of Canada as

Parks and Recreation Director as well as serve the Towns of Gander and

Stephenville in similar roles. Later he went on to work as director of marketing

at a Montreal based company.

For the past twenty years, Colonel Winsor has been self-employed. He is a

Notary Public and a Paralegal and for the past twenty-three years has been a

well-known syndicated sports columnist, through his column, "Views from Behind

the Bench."

Colonel Winsor himself has been highly active in competitive amateur sport.

He has nine provincial championships to his credit in four different sports and

is also a member of the provincial Softball Hall of Fame.

Mr. Speaker, Colonel Winsor has been and remains involved in a variety of

volunteer activities, including fifty years as a lay reader in the United Church

of Canada, District Commander for the Royal Canadian Legion, former mayor and

councillor, honorary Colonel for 9 Wing Gander, founder of Squadron 125 Silver

Wings Air Cadets in Eastport, and he is a member of many committees and

fundraising organizations, far too many to list here.

Colonel Winsor who currently resides in Happy Adventure with his wife Kay is

a tremendous asset to his town, region and entire Province. I ask all hon.

members to join with me in thanking Colonel Don Winsor for all he has done and

all he continues to do.

Thank you, Mr. Speaker.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The hon. the Member for the District of St. John's West.

SOME HON. MEMBERS: Hear, hear!

MS S. OSBORNE: Thank you, Mr. Speaker.

I rise today to congratulate Cowan Heights Elementary School, which was

presented with the Exceptional School Award from the Tourette Syndrome

Foundation of Canada on October 8 of this year.

Mr. Speaker, Cowan Heights Elementary School received this national

recognition for its commitment to accommodating students with challenging needs.

The school was nominated for the award by Janet Rumsey, President of the St.

John's

chapter of the Tourette Syndrome Foundation because she felt that Cowan

Heights Elementary staff created a supportive environment to successfully teach

children with multiple neurological disorders. Mrs. Rumsey's own four children

have attended the school over a period of several years and she has seen first

hand that any supports required by students are implemented very quickly.

Mr. Speaker, being presented the Exceptional School Award is a tremendous

honour for Cowan Heights Elementary School and for its dedicated teachers who

work so hard to accommodate the diverse needs of students.

I ask all hon. members to join me in extending congratulations to all those

involved and wishing them continued success in the future.

Thank you.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: Statements by Ministers.

Statements by Ministers

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

SOME HON. MEMBERS: Hear, hear!

MS POTTLE: Thank you, Mr. Speaker.

It gives me great pleasure to stand in the House today and inform hon.

members about an event that exemplifies how Aboriginal people in Newfoundland

and Labrador are celebrating achievement in business with distinction and

innovation.

More than 100 people gathered in Stephenville recently for the second annual

Aboriginal Business Gala, which I am pleased to say was sponsored in part by the

Department of Labrador and Aboriginal Affairs. A total of sixty-five Mi'kmaq

businesses were recognized and celebrated for their contribution to economic

development in their communities in the Port au Port, Bay St. George, and Burgeo

areas. The diversity of businesses recognized was impressive, ranging from

natural resources, tourism and recreation, retail, construction, accommodations,

and food service. The gala was hosted by the Aboriginal Community

Business/Advisory Committee.

Mr. Speaker, in Newfoundland and Labrador we have made great strides in

recognizing the contribution of Aboriginal people to our rich social and

cultural fabric. Throughout the Province, Aboriginal peoples are celebrating and

expressing their origins and traditions, often through the arts and cultural

events; but we must do more to recognize Aboriginal persons and groups who are

doing their part to develop and diversify the growing economy of Newfoundland

and Labrador. The Aboriginal Business Gala provides an opportunity to celebrate

the contribution of Aboriginal businesses, and note how they are key to

sustainability and growth in their communities. This celebration and recognition

is important because it helps to encourage and foster further success.

During this night of celebration, the Aboriginal Community/Business Advisory

Committee also announced the possible formation of an Aboriginal Board of Trade

and the committee is looking into offering business workshops to Aboriginal

business operators who need assistance with their marketing, expansion, and

business plans. The Aboriginal Community/Business Advisory Committee currently

has 143 Aboriginal businesses registered in a database and they will continue to

provide support to small business owners. I wish them all the very best success

in their efforts.

Mr. Speaker, I ask all hon. members to join me in congratulating the

Aboriginal Community/Business Advisory Committee on their second annual

Aboriginal Business Gala to showcase Aboriginal businesses in the Port au Port,

Bay St. George, and Burgeo areas.

Thank you very much.

SOME HON. MEMBERS: Hear, hear!

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

MR. KELVIN PARSONS: Thank you, Mr. Speaker.

I thank the minister for an advance copy of her statement.

It is indeed a pleasure to see, and we congratulate the Aboriginal peoples

who take

part in business opportunities. Our economy, of course, works best when

we work on all cylinders, as all groups in our Province who are involved in

making the economy grow.

We have had IBAs, for example, for quite some years now in the various

projects that we have had in this Province, particularly in Labrador, but IBA is

only one piece, of course, of the puzzle. We need to have Aboriginal groups take

every advantage of the IBAs but also the opportunities which IBAs bring.

We would certainly congratulate them on their conference that they had

because, again, doing it alone and not having anyone else know what you have

done is not achieving the best benefits. To see that these groups come together

to let each other know, to network and find out what is happening in their

Aboriginal communities, is great, and we certainly endorse and encourage that to

continue.

Thank you.

MR. SPEAKER: The hon. the Member for the District of Signal Hill-Quidi

Vidi.

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

I thank the minister for the advance copy of her statement.

I am delighted to join with her in congratulating the Aboriginal business

people who participated in the second annual gala. It certainly is something to

be very proud of, and I am delighted to see the Aboriginal business people on

the Port au Port, Bay St. George and Burgeo areas celebrating themselves and

celebrating what they are offering to the community at large. It is not easy to

be small business people and there are a lot of supports that are needed.

We have a small population in this Province, and I think a lot of their

businesses would thrive during the tourism season. They keep on, and that is

what is really important. I am really delighted to hear about their thought of

creating an Aboriginal board of trade, and I look forward to hearing how the

government would support that, if they decide they want to continue moving in

that direction. I just want to offer my congratulations to all Aboriginal

entrepreneurs, craftspeople and artisans in our Province.

Thank you very much, Mr. Speaker.

MR. SPEAKER: Further statements by ministers?

The hon. the Acting Minister of Human Resources, Labour and Employment.

SOME HON. MEMBERS: Hear, hear!

MS BURKE: Mr. Speaker, the Government of Newfoundland and Labrador is

committed to making sure that our Province's youth are truly engaged in all

aspects of society. As Minister Responsible for Youth Engagement, I rise today

to inform this hon. House that a new Office of Youth Engagement is now open for

business.

The Office of Youth Engagement will be responsible for ensuring a

co-ordinated approach among government partners and departments in the

implementation and ongoing development of youth public policies that impact

youth and their priorities. The office will be physically located within the

Department of Human Resources, Labour and Employment and will be staffed by a

manager and a policy and program development specialist, as well as a number of

work term students each year.

The office is one of forty-one initiatives contained in Creating A Province

of Choice: A Youth Retention and Attraction Strategy for Newfoundland and

Labrador, launched in November 2009. The strategy was developed with full input

and guidance of over 485 youth throughout the Province. It was clear from our

discussions with young people that they are deeply passionate and care about our

Province.

Young people are an essential partner in helping shape the future of

Newfoundland and Labrador, and the Office of Youth Engagement is another fine

example of our commitment to our youth strategy. It will engage youth in policy

development; help government departments view their policies and programs with a

youth lens; raise awareness of the importance of youth engagement; and, it will

provide a single point of entry to help ensure youth throughout all regions of

the Province know where they can go to have their voices heard.

Mr. Speaker, I encourage all young Newfoundlanders and Labradorians to visit

our Web site or our Facebook page to see how the provincial government supports

youth engagement, education, employment, diversity and healthy living. We will

continue with a fresh, modern approach to fully engaging young people in working

with us to address challenges facing the Province.

Creating A Province of Choice: A Youth Retention and Attraction Strategy for

Newfoundland and Labrador, and the new Office of Youth Engagement will help us

further position Newfoundland and Labrador as the province of choice for young

people, and all people, to live and work for generations to come.

Thank you, Mr. Speaker.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The hon. the Member for the District of Port de Grave.

MR. BUTLER: Thank you, Mr. Speaker.

I want to thank the minister for an advance copy of her statement, commend

government for its youth retention strategy with the opening of this new office,

and also to extend every good wish to those young people who will be employed

there from time to time to carry out the various duties in networking and

gaining experience. I also want to commend them with regard to the use of

Facebook and the Web site, social marketing strategies, because, Mr. Speaker, we

know that is the way of the future.

Mr. Speaker, I know when this was all put in place that many young people

throughout our Province took

part in Newfoundland and Labrador, and it is good

to see that government listened to them. I noticed when the minister mentioned

that they will be engaging the youth in policy development and helping

government departments view their policies and programs; hopefully the advice

those young people will be giving to them will be adhered to as well.

Mr. Speaker, as we know, in all Canadian provinces we are facing an aging and

a declining population. This is a good first step but much has to be done, Mr.

Speaker, because we know here in our Province today many of our young people in

the various trades cannot find work here in their own Province. Hopefully, with

this strategy unfolding, it will be a means for those young people to be able to

find the work that they need right here in their own Province of Newfoundland

and Labrador where they do want to live.

Thank you, Mr. Speaker.

MR. SPEAKER: The hon. the Member for the District of Signal Hill-Quidi

Vidi.

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

I, too, thank the minister for an advance copy of the statement.

This is a good announcement today, the setting up of the Youth Engagement

Office. We need to have the youth and others directly involved in the decision

making and the planning of initiatives that will affect their lives. The

ministry started this, of course, by holding the consultations, and I am

delighted to see that one of the things that were recommended throughout the

consultations, by young people, is being put in place. Government also needs to

look at other consultations that have taken place in this Province, such as the

one on long-term care and home care, and I hope that the voice of people around

that issue will be heard the same way that our young people have been heard, Mr.

Speaker.

I do encourage the government, though, to realize that all these initiatives

are good and they are really important, but the thing that is most going to keep

our young people here are job opportunities, decent work, and decent wages. So,

I encourage government to work out very carefully where those jobs are going to

come from so that we can keep our youth in this Province and engaged.

Thank you very much, Mr. Speaker.

MR. SPEAKER: Further statements by ministers?

The hon. the Minister of Business.

SOME HON. MEMBERS: Hear, hear!

MR. WISEMAN: Thank you, Mr. Speaker.

The aerospace and defence industry is a key sector for the Province of

Newfoundland and Labrador and is one that our government is committed to helping

grow.

The aerospace and defence sector is estimated to be worth approximately $150

million to the Province and employs some 1,800 people. Mr. Speaker, we would

like to see those numbers grow and increase, and our government is doing its

part to help foster the key relationships between institutions in the Province

and some of the world's leading aerospace and defence companies.

Earlier this year, we facilitated an agreement with Lufthansa, one of the top

three aviation companies in the world, to enter into a partnership with the

College of the North Atlantic in Gander. This agreement will see the

establishment of European Aviation Safety Administration certification for the

students of the aircraft maintenance program. Representatives of Lufthansa, who

were here for the announcement, stated that the partnership results in "one of

the most innovative programs for aircraft mechanics worldwide."

Just last week, Mr. Speaker, another partnership was announced involving

Lockheed Martin, the largest defence contractor in the world, and the Marine

Institute. As part of the project, the Marine Institute is adapting training

software that is currently being used by some of the world's largest navies so

that it can be utilized by students and industries.

Ensuring that we have a highly skilled workforce with the proper education

and training is fundamental to attracting the inward investment to Newfoundland

and Labrador. Of course, having the right personnel also increases the

Province's attractiveness to the aerospace and defence companies who are

interested in doing business here.

Partnerships with companies such as Lufthansa and Lockheed Martin bring

worldwide attention to Newfoundland and Labrador's aerospace and defence sector

and help us stress to the international business community that local companies

have the technological capability and the know-how to compete and win major

contracts in the international marketplace.

Mr. Speaker, the expansion of industries such as aerospace and defence help

us diversify our economy and create well-paying jobs for Newfoundlanders and

Labradorians. We will continue to work closely with local companies and the

aerospace and defence industry to continue to grow and advance this sector, Mr.

Speaker.

Thank you very much.

SOME HON. MEMBERS: Hear, hear!

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

MR. KELVIN PARSONS: Thank you, Mr. Speaker.

I thank the minister for an advance copy of his statement.

It is great to see that government, of course, is expanding upon the

initiative. This was started quite some years ago, the Province's entry into the

aerospace industry back in the days of Premier Tobin, the Liberal

Administration, and the late Mr. Craig Dobbin, of course, who took the

initiative in the Gander area. So, it is great to see that government is

continuing with those initiatives. The more diverse our economy is whether it

is a fishing industry, an offshore industry, the aerospace industry, the defence

industry the better it all functions, the more opportunities there are for

employment, the better the jobs that are created. Fundamental to all of that, of

course, is not only the opportunities; we have to have the people who can take

advantage of the opportunities when it comes to being educated and being trained

in order to avail of those job opportunities.

I guess if there are any disappointments or complaints that we would have as

an Opposition it is that we called the Minister of Business today the minister

of re-announcement because we get a year-end announcement now as to these two

projects, both of which were announced in the spring; they announce them when

they are starting them; they announce them when they are over, and then just to

make sure everybody in the Province knows about it, they re-announce them again

at the end of the year. It is called the year-end wrap-up.

It is very indicative of the productivity of this department that,

unfortunately, in this year these are the only two things he has to re-announce;

the department has not been exactly productive. As we pointed out in the

Estimate Committees last year, Mr. Speaker, that department spent more on

continuing its own existence and paying staff members than it did in terms of

putting money out the door for investment. That is not a very good record, I say

to the minister, Mr. Speaker. So hopefully in the future we will have a lot of

announcements, and not just a repeat of two announcements and a department that

can hardly justify its existence based on what it is spending today.

Thank you, Mr. Speaker.

MR. SPEAKER: The hon. Member for the District of Signal Hill-Quidi Vidi.

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

I, too, thank the minister for the advance copy of his statement.

These are great partnerships and the companies that the minister has spoken

about are known worldwide and certainly have great reputations. I feel very

confident that the programs, both the one with the college and the one entered

into with Marine Institute, are going to be beneficial for the people in them

and hopefully for the future here.

I have to say that I have to join with the Official Opposition in also saying

my disappointment with this department. I thought this department, Mr. Speaker,

was supposed to bring businesses into this Province to create new business and

new jobs.

SOME HON. MEMBERS: Oh, oh!

MR. SPEAKER: Order, please!

MS MICHAEL: That is not what I hear, Mr. Speaker. The NDP would very much

like to see more jobs in this Province. This government continues to make

promises and not keep them.

These announcements, Mr. Speaker, I do not know why they are not coming from

the Department of Education or ITRD because this department has nothing to

announce so it is trying to make people think they are doing something. Give us

some businesses and give us some jobs.

Thank you very much, Mr. Speaker.

SOME HON. MEMBERS: Oh, oh!

MR. SPEAKER: Order, please!

Further statements by ministers?

Oral Questions.

Oral Questions

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

MR. KELVIN PARSONS: Thank you, Mr. Speaker.

Yesterday in this House, I asked the Premier to explain what role, if any,

and what say Hydro-Qubec might have in the Muskrat Falls project. We know that

because of its size, Muskrat will not be able to produce twenty-four hours of

power a day. In order to be able to offer firm power to its customers, Nalcor

will have to arrange a swap power agreement with CF(L)Co and, or Hydro-Qubec at

Churchill Falls.

Premier, I ask again: What discussion, if any, have you or Nalcor officials

had with Hydro-Qubec to ensure that customers of Muskrat Falls will be

guaranteed firm power?

MR. SPEAKER: The hon. the Premier.

SOME HON. MEMBERS: Hear, hear!

PREMIER DUNDERDALE: Thank you, Mr. Speaker.

Mr. Speaker, there has not been any discussion with Hydro-Qubec on

electricity generation coming out of Muskrat Falls, nor has there needed to be,

other than around the issues of water management. We have a piece of legislation

that governs how our rivers are managed in this Province now; ultimately

governed by the Public Utilities Board.

Mr. Speaker, we have water management rights on the Churchill River, we have

reservoirs on the Island, and we have reservoir rights on the Upper Churchill.

Between all of our capacity that we have in terms of our generation, Mr.

Speaker, we can firmly commit to meet all of our commitments that we make

domestically and abroad.

SOME HON. MEMBERS: Hear, hear!

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

MR. KELVIN PARSONS: Thank you.

Mr. Speaker, I think most people in this Province are awakening to the fact

that the Muskrat Falls project is a pretty sweet deal for Emera of Nova Scotia.

Not only is Emera getting free energy from Newfoundland and Labrador for

thirty-five years, it will actually get extra free energy during the first five

years of the project if the deal goes through.

My question to the Premier is: Why, Premier, are we giving Emera extra free

power during the first five years of transmission on the Maritime Link?

MR. SPEAKER: The hon. the Premier.

SOME HON. MEMBERS: Hear, hear!

PREMIER DUNDERDALE: Thank you, Mr. Speaker.

Mr. Speaker, what we are contracted to sell to Emera is one terawatt of power

for thirty-five years. For that amount of power they will pay $1.2 billion. They

will also pay 20 per cent of the operational and maintenance costs of the whole

generation and transmission system, Mr. Speaker. They are going to get 20 per

cent of the power, Mr. Speaker, and they are going to pay 20 per cent of the

costs; because of that contract we are going to have with Emera we are no longer

an isolated system.

First of all, we provide clean, cheap electricity to the people of the

Province, we do a good deal with Emera that allows us to construct

infrastructure to wheel our electricity, and because of this we are able to

access markets outside of Newfoundland and Labrador.

SOME HON. MEMBERS: Hear, hear!

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

MR. KELVIN PARSONS: Thank you, Mr. Speaker.

Just in case the Premier did not understand my question: Why are you giving

the extra power you are giving on the first five front-end of this project,

the extra power to Emera why are we doing that?

MR. SPEAKER: The hon. the Premier.

SOME HON. MEMBERS: Hear, hear!

PREMIER DUNDERDALE: Mr. Speaker, I understood very clearly the question

that the Acting Leader of the Opposition asked.

Mr. Speaker, I am telling you and the people of the Province that the Term

Sheet we have signed with Emera is for one terawatt of power a year for

thirty-five years, for which they will pay $1.2 billion. Mr. Speaker, how we

deliver that power over the thirty-five years will be worked out between Nalcor

and Emera. Mr. Speaker, the critical piece that people need to understand, is

one terawatt of power per year for thirty-five years, for which they will pay

$1.2 billion, plus 20 per cent of operations and maintenance.

SOME HON. MEMBERS: Hear, hear!

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

MR. KELVIN PARSONS: Thank you, Mr. Speaker.

All we know so far, Premier, is that we have a deal that is front-end loaded.

Not only is it a sweet deal for Emera, but you have front-end loaded the deal

for Emera. The question was why you would do such a thing?

Mr. Speaker, free power is not the only reason Emera is so happy with the

Muskrat Falls deal. Another reason, of course, is that in the $6.2 billion

project, the people of this Province are bearing nearly all the risk. This

Province and Nalcor are assuming all the construction and financial risk for the

Muskrat generating plant, and despite the fact that Emera will own 29 per cent

of the Labrador to Newfoundland underwater cable we are assuming all the rest

for that as well.

Premier, can you confirm that on top of all those benefits we are giving to

Emera, and the risk that we are assuming, that people in this Province and

Nalcor will also bear 50 per cent of the construction and financial cost on any

overruns associated with the Maritime link, even though Emera will own 100 per

cent of that Maritime Link?

MR. SPEAKER: Order, please!

The hon. the Premier.

PREMIER DUNDERDALE: Thank you, Mr. Speaker.

Mr. Speaker, we are bearing all of the risk on the generation facility

because we own completely 100 per cent of the generation at Muskrat Falls.

SOME HON. MEMBERS: Hear, hear!

PREMIER DUNDERDALE: Mr. Speaker, while it is true that Emera will own the

Maritime Link for thirty-five years, they will only have the ability to wheel

one terawatt of power across that link. Mr. Speaker, all rights above the one

terawatt lie with Nalcor. That is a good deal for Nova Scotia; that is a far

better deal for Newfoundland and Labrador.

SOME HON. MEMBERS: Hear, hear!

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

MR. KELVIN PARSONS: Thank you, Mr. Speaker.

It might make sense if we are going to own the full generation facility that

we bear all the risk. That does not apply when it comes to the rest of it

though, does it, Premier on transmission lines? Nalcor is on the hook for

that, and we as a Province.

Mr. Speaker, we know that in return for the investment of $600 million in the

Labrador to Newfoundland link, Emera will receive 29 per cent ownership of that

link and hence 29 per cent of all profits ever made by that link for at least

fifty years. That is not a bad guaranteed return on your investment. Meanwhile,

we know that, according to the term sheet, Emera is actually a 49 per cent owner

of all the transmission assets that will be built as a part of the project.

I ask the Premier: Emera is getting a guaranteed profit on the energy that

will be shipped to this Island; how much is Nalcor going to get from the energy

that we ship to Nova Scotia? We know what they are getting; what are we getting?

MR. SPEAKER: The hon. the Premier.

SOME HON. MEMBERS: Hear, hear!

PREMIER DUNDERDALE: Thank you, Mr. Speaker.

Mr. Speaker, we are going to get $1.2 billion for one terawatt of power. Mr.

Speaker, we are going to get 20 per cent of the operations and management. Mr.

Speaker, we are going to get access to a transmission link for its capacity

beyond one terawatt, so the 1.9 over and above domestic needs and what we have

sold to Emera that is available for export outside the Province will be able

to be wheeled across the Maritime Link. For that we will be able to get access

to get all of Emera's infrastructure in Nova Scotia, in New Brunswick, and into

Maine, paying only our costs when we are actually using that infrastructure that

we would not have been able to afford otherwise, allowing us to get into the

market to the United States with 1.9 terawatts of power, Mr. Speaker.

SOME HON. MEMBERS: Hear, hear!

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

MR. KELVIN PARSONS: Thank you.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: Order, please!

The hon. the Leader of the Opposition.

MR. KELVIN PARSONS: Thank you, Mr. Speaker.

I guess we will see at the end of the day, Premier. So far we have found

enough off-ramps in this to drive a fleet of Mack trucks through, and we are not

even started on it yet.

Mr. Speaker, the CEO of Nalcor Energy is on record as saying that even if

Ottawa does not back a loan for the Muskrat project or provide the $375 million

grant which the Province was seeking, this project would still be viable and

could be funded. That means the people of this Province will have to bear the

full cost. Part of any borrowing costs, of course, is determined by how much

equity you have to put into a project.

I ask the Premier: How much equity do we have to put into this project? Where

is it coming from, or how much will have to be borrowed, because we do not have

the equity?

MR. SPEAKER: The hon. the Minister of Finance and President of Treasury

Board.

SOME HON. MEMBERS: Hear, hear!

MR. MARSHALL: Thank you, Mr. Speaker.

The amount of equity and the amount of debt that goes into this project will,

of course, be determined in the future when we decide on what debt equity ratio

will give the best benefit to the people of this Province. Our Province has made

tremendous headway financially over the last six years. We have had surpluses in

five of those six years. Well, the result of the surpluses is $4.1 billion to

the bottom line of this Province. We have reduced the debt GDP equity from 63

per cent to 31 per cent; and, as a result of that, the rating agencies, all

three of them, have upgraded the Province's credit. As a result of that enhanced

fiscal position, it has given us the flexibility and the opportunity to access

the required capital necessary to finance this project and, in fact, a much

larger project is necessary.

SOME HON. MEMBERS: Hear, hear!

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

MR. KELVIN PARSONS: Thank you, Mr. Speaker.

I am glad to see the Minister of Finance has interceded here. Maybe we might

get some information, but we do not need a recitation of what you have done in

the last six years' budgets.

Maybe the minister would like to tell us in a direct response to a direct

question: Where are you going to get the money to do this, and what equity do

you have to put into it?

MR. SPEAKER: Order, please!

The hon. the Minister of Finance and President of Treasury Board.

SOME HON. MEMBERS: Hear, hear!

MR. MARSHALL: Mr. Speaker, the week before last I went to Toronto and I

met with our lenders, and they have indicated to us that the financial community

has indicated that the Province will have the ability to raise the necessary

capital and that the markets are sufficiently robust to be able to provide the

required amounts. In fact, one of the lenders said he would not be surprised if

our bonds in this project sold out in less than fifteen minutes.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: Order, please!

The hon. the Member for the District of Port de Grave.

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

In January of this year, the Auditor General released his report on child

care spending at Eastern Health. In particular, he looked at Code 79 expenses,

which are costs for children and youth who cannot be placed in foster care.

These costs grew from $3 million in 2005 to $13.5 million in 2009, yet there

were no policies and procedures in place to ensure the money was being spent

appropriately.

I ask the minister: What policies and standards have been put in place, not

only for Eastern Health but all of the regional health authorities to ensure

that money is being spent in the very best way possible to meet the needs of the

most vulnerable children?

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

SOME HON. MEMBERS: Hear, hear!

MS BURKE: Mr. Speaker, the Department of Child, Youth and Family Services

was created because we felt there were concerns with that field, and we felt

that we needed to address them in a more direct way than they were being

delivered in the Province.

Mr. Speaker, one thing that we have been doing to make sure that the best

interests of the children are being met, is we are streamlining the adoption

process. Mr. Speaker, we are also looking at resources that we have in our

communities now that are probably underutilized. Because we are paying for these

resources as they stand now, we are also using that as an ability to be able to

move some of the children who are presently housed in ALAs into some of the

existing resources.

Further to that, Mr. Speaker, we need a long-term solution to how we deal

with the children and how we deal with children who come into care in this

Province. Mr. Speaker, we are also developing a long-term strategy to help us to

identify what services we need and how best to set up these services in the

Province.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: Order, please!

The hon. the Member for the District of Port de Grave.

MR. BUTLER: Mr. Speaker, in 2009, at Eastern Health alone, there were

eighty-six children and youth living in alternate living arrangements. These

children were there anywhere from four months to twenty-seven months. Of the

sixteen files that the Auditor General reviewed, 63 per cent of them were there

for over a year. These arrangements are meant to be temporary living

arrangements for children, Mr. Speaker.

I ask the minister: What has your government done to ensure that the time

children spend in ALAs is minimal?

MR. SPEAKER: The hon. the Minister of Child, Youth and Family Services.

SOME HON. MEMBERS: Hear, hear!

MS BURKE: Mr. Speaker, we have taken a number of measures to ensure that

the length of time that a child spends in an ALA is being addressed. As I said,

one of the initiatives is trying to streamline the adoption process so that

permanency planning starts earlier within the case when we handle somebody who

comes into care.

Also, Mr. Speaker, in the last eighteen months we have created an additional

134 foster homes in Newfoundland and Labrador. That is a tremendous amount of

work that goes into licensing these homes, and they provide quality care for our

young people.

Mr. Speaker, in addition to that, we do have to develop our long-term

strategy. As I said, we do have resources in the Province that are

underutilized, that we contract and we pay for under this department. We are

making sure that we use these resources. I understand there is a meeting every

Friday to make sure that we are able to move as many children from an ALA into

the existing resources that we have in the Province of Newfoundland and

Labrador. Mr. Speaker, this is something we take quite seriously.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: Order, please!

The hon. the Member for the District of Port de Grave.

MR. BUTLER: In 2009, Mr. Speaker, there were fifteen service providers

that received payments for living arrangements for our most vulnerable youth,

the total cost $13.5 million. Some of the providers were private businesses,

others were not for profit. The Auditor General found that there was no

measurable way to determine just how effective the service was that was being

provided to our children.

I ask the minister: How do we know if the service being provided is

acceptable; and were improvements, if any, needed to be made with each provider?

MR. SPEAKER: The hon. the Minister of Child, Youth and Family Services.

SOME HON. MEMBERS: Hear, hear!

MS BURKE: Mr. Speaker, a number of the services that we provide through

Child, Youth and Family Services, that provide residential care to our young

people, are long-standing contracts with boards, such as WayPoints in St. John's

or with boards that would govern; Pine Heights home in Grand Falls-Windsor or

the Youth Assessment Centre in Stephenville, Mr. Speaker. We also deal with

agencies like the John Howard Society, who provide two facilities as well in

Newfoundland and Labrador.

Mr. Speaker, I feel that the agencies that we deal with have a very strong

understanding of the needs of children in Newfoundland and Labrador. We contract

with these agencies, these are long-standing contracts that have been in place

year over year, but, Mr. Speaker, it is also important that we continue to

monitor quality and make sure that the changing needs of children and the

changing profile of Newfoundland and Labrador is reflected in the services that

we provide.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The hon. the Member for the District of Port de Grave.

MR. BUTLER: Mr. Speaker, there is a shortage of caregiver homes in this

Province, not only in St. John's. There needs to be a continuum of residential

services in this Province. Your government has known this for several years.

I ask the minister: What is the status of the number of caregiver homes in

the Province, and what are you doing to address the continued shortage?

MR. SPEAKER: The hon. the Minister of Child, Youth and Family Services.

SOME HON. MEMBERS: Hear, hear!

MS BURKE: Mr. Speaker, as I previously stated, in the last eighteen

months we have created an additional 134 caregiver homes. When I said foster

homes, that means caregiver homes.

SOME HON. MEMBERS: Hear, hear!

MS BURKE: Mr. Speaker, we have also increased resources in some of our

offices outside St. John's in order to be able to put more emphasis on the

creation and the licensing of these homes. Mr. Speaker, this is not taken

lightly. When somebody applies to be a caregiver in Newfoundland and Labrador,

there is a program that they have to complete, known as the PRIDE program. They

have to go through a very thorough assessment, and we make sure that we have all

the necessary assessments done before we license that home.

Mr. Speaker, when we take a child into care and we put the child to live with

another family in Newfoundland and Labrador, we have to do our utmost to make

sure that we provide a safe environment. Mr. Speaker, we are working towards

that every day.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The hon. the Member for the District of Port de Grave.

MR. BUTLER: Thank you, Mr. Speaker.

Our most vulnerable children are being cared for in ILAs, ALAs, group homes,

and out-of-province placements. Government has failed to put the proper policies

and procedures in place to protect these children, and, as a result, the

government cannot state that the care these children are receiving is the best

care.

Back in March 2009, government announced a new department responsible for

Child, Youth and Family Services. Your government has had almost two years since

to make any significant changes.

I ask the minister: Are we ever going to see any provincial policies and

standards from your government to help protect the most vulnerable in care?

MR. SPEAKER: The hon. the Minister of Child, Youth and Family Services.

SOME HON. MEMBERS: Hear, hear!

MS BURKE: Mr. Speaker, we are working on a continuum of care, and we do

have new foster homes. I have publicly stated that ALAs is not the long-term

solution, and we are going to be moving away from that form of care.

Mr. Speaker, I do take offence to saying that our group homes in Newfoundland

and Labrador do not provide quality care. These are long-standing contracts with

agencies that I have a great respect for, and I challenge the hon. member to

tell me which agency and which group home you are talking about that you think

is not providing quality care.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The hon. the Member for the District of Port de Grave.

MR. BUTLER: Thank you, Mr. Speaker.

According to the Auditor General and the reports that we received, the

minister has no way of knowing that.

SOME HON. MEMBERS: Oh, oh!

MR. SPEAKER: Order, please!

MR. BUTLER: Mr. Speaker, even as late as a few months ago when we

questioned the minister, she said that they were still actively transitioning

into the department and learning about the issues. With the latest Cabinet

shuffle, however, this government has gone backwards. Once again we see that

children cannot be the minister's priority because she now has two departments.

I ask the minister: Why were you willing to take on another government department

when, clearly, your primary role as Minister of Child, Youth and Family Services

is not even on track yet?

MR. SPEAKER: Order, please!

The hon. the Minister of Child, Youth and Family Services.

SOME HON. MEMBERS: Hear, hear!

MS BURKE: Mr. Speaker, in case the hon. member does not know, a lot of

times people can give attention to different priorities, and many times, in our

lives and in our work, we have things that are equally important that we have to

work on. If the hon. member thinks for one minute that this government or this

minister is not committed to Child, Youth and Family Services in setting up the

best service we can have, he is dead wrong. We are here to do the best we can.

SOME HON. MEMBERS: Hear, hear!

MS BURKE: Mr. Speaker, we have acknowledged that there are issues. We

have taken the Turner report, we have taken the Clinical Services Review, and we

have created a new department. We put $24 million into this service in recent

years before we even created the new department. We have created over 200 new

positions.

Mr. Speaker, we will change the system and we will bring forward the

improvements that are necessary. For the member to suggest we are not serious,

like I said, Mr. Speaker, he is dead wrong.

MR. SPEAKER: Order, please!

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The hon. the Member for the District of The Straits & White

Bay North.

MR. DEAN: Thank you, Mr. Speaker.

Mr. Speaker, throughout this fall we have heard from many teachers from

across the Province all speaking of nepotism and unfair hiring practices within

our school system. In response to these concerns, the Minister of Education

personally conducted a review of hiring practices of the school boards, and he

found nothing.

My question to the minister: Teaching professionals have indicated that it

was inappropriate for him, as minister, to be doing this review; will he commit

to an independent review as the teachers have asked for?

SOME HON. MEMBERS: Oh, oh!

MR. SPEAKER: Order, please!

The hon. the Minister of Education.

SOME HON. MEMBERS: Hear, hear!

MR. KING: Mr. Speaker, I thank the member opposite for the question. He

obviously has no recollection of what he said publicly because it was the

Opposition who asked me to get involved in the first place, Mr. Speaker.

Let me just remind the member opposite of what transpired. I was asked to

become involved in this process, to look at the teacher hiring practices of

school boards, not to look, Mr. Speaker, at individual teacher grievances in the

Province. I looked at the process, Mr. Speaker. I have a background; I have

worked with the school board for many years. So, I looked at the process from my

own personal perspective, and I drew some of my own conclusions. I also engaged

the NLTA - which in many circles would be seen as our adversaries in this

process - sought their input, and they concurred with it.

Further, Mr. Speaker, we went to an independent agency, the Public Service

Commission, that is the independent group, arm's-length from government, that

deals with hiring in this Province. They concluded as well that the policies and

the procedures that are in place demonstrate fairness and an equable process for

anyone looking for a job with school boards in the Province.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The hon. the Member for the District of The Straits & White

Bay North.

MR. DEAN: Thank you, Mr. Speaker.

Mr. Speaker, many teachers have expressed their feelings that when it comes

to hiring it is more about who you know than what you know. It appears that the

department has passed the blame off to regional school boards, making them

solely responsible for teacher hiring. What this means is that there is no

standardized provincial criteria for teacher hiring and principals are able to

hire whomever they choose.

I ask the minister: Does that make sense to him, since the Minister of

Education is responsible for all aspects of K-12 education; and will he commit

to government being involved in regulating teacher hiring?

SOME HON. MEMBERS: Oh, oh!

MR. SPEAKER: Order, please!

The hon. the Minister of Education.

SOME HON. MEMBERS: Hear, hear!

MR. KING: Mr. Speaker, I am actually very interested in the train of

thought the member is putting forward. I wish we could have more than a minute

each because it sounds to me like he wants to involve the political arm of

government into the hiring, yet at the same time he is suggesting that is the

reason people are not getting jobs. So I am getting mixed messages, Mr. Speaker.

The reality is that we operate within the parameters of the Schools Act, Mr.

Speaker. Let me remind the member opposite, it was the Liberal government who

wrote the last Schools Act when they merged the school boards because I worked

with the boards at the time. They are the ones that defined the roles of school

boards. The role of the minister is purely policy and directional in nature, Mr.

Speaker. It is the school boards that have the vested authority to operate their

school districts and to organize schools in the Province for students to attend.

That means opening and closing schools. It means hiring personnel, not only

teachers; we have many, many important employees. We have janitors, caretakers,

secretaries, and bus drivers, all of which are the responsibility of school

boards, not the Minister of Education.

SOME HON. MEMBERS: Hear, hear!

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

MR. KELVIN PARSONS: Mr. Speaker, my question is for the Minister of

Transportation. A bridge in the Codroy Valley - commonly referred to as the

Bailey bridge - has been closed, apparently, due to it being structurally

unsound. This bridge has become crucial to the residents and the businesses of

that area. Residents have been looking for some commitment from government that

the bridge will, indeed, be replaced and replaced as soon as possible since it

is having a major impact on their lives. They have held public meetings, they

have asked their MHA, the Member for St. George's-Stephenville East, to get

involved, and they want an answer to this problem.

I ask the minister: Are you and your department prepared to commit to the

replacement of the Bailey bridge at Searston Gut; and, if so, how quickly can

this be accomplished?

MR. SPEAKER: The hon. the Minister of Transportation and Works.

SOME HON. MEMBERS: Hear, hear!

MR. HEDDERSON: Well, Mr. Speaker, in response to the question from the

member opposite, naturally we have inspected the bridge and closed it down for

public safety because the underpinnings of the bridge are in a sad state of

disrepair. As well, the bridge itself is fine, and what has to happen is that,

basically, the bridge has to be pulled back and a major overhaul of the

underpinnings has to be done.

Now, we have done a similar bridge, not so long ago, and the cost of it would

be in the millions of dollars. As well, it would have to be done at a time other

than the winter. So, right now, we are looking at

AN HON. MEMBER: (Inaudible).

MR. HEDDERSON: That is part of the problem, as the member has just

pointed out. It was a temporary situation that was done in the middle of winter.

Obviously, a job of that nature should be done in (inaudible) -

MR. SPEAKER: Order, please!

The hon. the Member for the District of Signal Hill-Quidi Vidi.

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

Mr. Speaker, in legislation being put before the House this afternoon,

government is asking for an amendment to their hastily concocted 2008

AbitibiBowater expropriation bill. The amendment would allow Fortis, Chi

Hydroelectric, and other private owners of other expropriated hydroelectric

projects, to be paid compensation for their assets. Yet, in a recent media

interview, the Premier stated this government plans to return the assets to

their owners.

Mr. Speaker, I ask the Premier: What is government doing, paying for assets

the people of Newfoundland and Labrador currently own or returning those assets

to private hands for private profit?

MR. SPEAKER: The hon. the Premier.

SOME HON. MEMBERS: Hear, hear!

PREMIER DUNDERDALE: Thank you, Mr. Speaker.

Let me begin by saying that the expropriation of Abitibi's assets in

Newfoundland and Labrador is one of the best things this government ever did.

SOME HON. MEMBERS: Hear, hear!

PREMIER DUNDERDALE: Mr. Speaker, there were innocents, so to speak, who

were caught up in that action. Our commitment at that time was that we would

keep these companies whole. Mr. Speaker, that is entirely what we mean to do; we

intend to keep these companies whole. If that means returning their assets if

that is how they want to be kept whole and they want their assets returned to

them as they were at the time of expropriation that is what will happen. If

they want to pursue a negotiation with Nalcor to liquidate those assets, then

they can enter into that kind of a discussion as well, Mr. Speaker. The bottom

line is we are going to keep these companies whole.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The hon. the Member for the District of Signal Hill-Quidi

Vidi.

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

Government's expropriation of AbitibiBowater assets, which this party

supported and still supports, has been fraught with complications, and the

Premier has to just explain one of them, Mr. Speaker. I am wondering in this

complicated situation we are talking about, whether we are talking about

compensation or giving the assets back which means we lose if the assets go

back.

I ask the Premier: Are negotiations going on between this government now and

these private companies?

MR. SPEAKER: The hon. the Premier.

SOME HON. MEMBERS: Hear, hear!

PREMIER DUNDERDALE: Mr. Speaker, we have had discussions with these

companies from day one. From the very first day that we contemplated

expropriation we have had lines of communication open with these companies. Mr.

Speaker, our action was against AbitibiBowater; it was not against Enel or

Fortis or anybody else who might have gotten caught up in that action. Mr.

Speaker, our commitment to them was that we would keep them whole. Now, Mr.

Speaker, if that means that the company who has assets wants to keep assets,

then we are going to respect that. The action around expropriation was not

against those people, Mr. Speaker, it was against AbitibiBowater.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: Order, please!

The time allotted for questions and answers has expired.

Presenting Reports by Standing and Select Committees.

Tabling of Documents.

Tabling of Documents

MR. SPEAKER: The hon. the Minister of Finance and President of Treasury

Board.

MR. MARSHALL: Mr. Speaker, pursuant to

section 26 (5)(

a) of the Financial

Administration Act, I am tabling twenty-one Orders in Council relating to

funding precommitments for the 2011-2012 to 2015-2016 fiscal years.

Thank you, Mr. Speaker.

MR. SPEAKER: Further tabling of documents?

The hon. the Minister of Government Services.

MR. HARDING: Mr. Speaker, I am pleased to stand today to table the 2010

Annual Report for the Chartered Accountants of Newfoundland and Labrador.

Thank you, Mr. Speaker.

MR. SPEAKER: Further tabling of documents?

As the Speaker of the House of Assembly I hereby table the Annual Report on

Election Expenses from January 1, 2009 to December 31, 2009 as submitted by the

Office of the Chief Electoral Officer.

Further tabling of documents?

Notices of Motion.

Notices of Motion

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

MS BURKE: Mr. Speaker, I give notice that I will on tomorrow ask leave to

introduce the following resolution:

WHEREAS subsection 4(1) of the Child and Youth Advocate Act provides the

Office of the Child and Youth Advocate shall be filled by Lieutenant-Governor in

Council on a resolution of the House of Assembly;

NOW THEREFORE

BE IT RESOLVED that Ms Carol Chafe be appointed as the Child

and Youth Advocate.

MR. SPEAKER: Further notices of motion?

Answers to Questions for which Notice has been Given.

Petitions.

Orders of the Day.

Orders of the Day

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

MS BURKE: Mr. Speaker, I move motion 1 pursuant to Standing Order 11 that

this House not adjourn at 5:30 p.m. today on Tuesday, December 14, 2010 and

further, Mr. Speaker, I move motion 2, pursuant to Standing Order 11 that this

House not adjourn 10:00 p.m. today on Tuesday, December 14, 2010.

MR. SPEAKER: The motion is that this House not adjourn at 5:30 o'clock

p.m. today being Tuesday, December 14, 2010.

All those in favour, aye'.

SOME HON. MEMBERS: Aye.

MR. SPEAKER: All those against, nay'.

The motion is carried.

Motion carried.

MR. SPEAKER: A further motion that this House not adjourn at 10:00

o'clock p.m. on Tuesday, December 14, being today.

All those in favour, aye'.

SOME HON. MEMBERS: Aye.

MR. SPEAKER: All those against, nay'.

The motion is carried.

Motion carried.

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

MS BURKE: Thank you, Mr. Speaker.

I will call Order 13, second reading of Bill 44.

Excuse me, Mr. Speaker, I will change; I will go to Order 15, second reading

of Bill 46.

MR. SPEAKER: Before I recognize the hon. the Minister of Finance and

President of Treasury Board, I would just like to make some commentary on Bill

46 and Bill 44.

Many times in the House when we see bills being introduced and debated here,

and we see the word tax or the words income tax, we right away think that this

is going to be a money bill which opens up debate for a whole wide range of

debate. Many times relevance is called; we are not certain. Our Standing Orders

are never clear when this is brought forward, and we are hoping that with our

new proposal for the Standing Orders that might be introduced into the House at

a later date there might be some clarification brought to those matters.

The Chair has had an opportunity to confer with those who have more wisdom

than he has, and the Chair has agreed that Bill 46,

An Act To Implement The

Comprehensive Integrated Tax Coordination Agreement Between The Government Of

Canada And The Government Of Newfoundland And Labrador, ratifies an agreement

the joint administration of certain taxation regimes. It does not have as its

sole purpose the appropriation of any part of the public revenue or of any tax

impulse.

This bill is not a money bill, which would, in accordance with our practice,

admit a wide-ranging debate. The bill has to do with administration, not the

appropriation of revenue or of a tax.

Hopefully that will bring some clarification.

The hon. the Minister of Finance and President of Treasury Board.

SOME HON. MEMBERS: Hear, hear!

MR. MARSHALL: Thank you, Mr. Speaker.

It is my responsibility here today, as Finance Minister, to speak to second

reading and to urge passage of Bill 46, which is entitled,

An Act To Implement

The Comprehensive Integrated Tax Coordination Agreement Between The Government

Of Canada And The Government Of Newfoundland And Labrador. Now, I know everybody

watching this on TV has now gotten up and they are gone to get themselves a cup

of tea, so I will do my best to try to make this interesting.

Mr. Speaker, people will remember back in 1997 when the Province of

Newfoundland and Labrador, which at that time had in effect

an act called the

Retail Sales Tax Act, which of course was a sales tax, and the Government of

Canada introduced the famous Goods and Services Tax, which was an 8 per cent tax

of Newfoundland and Labrador, and the Province of Nova Scotia, as well as New

Brunswick, agreed to harmonize those taxes into a new tax of 15 per cent at the

time, called the Harmonized Sales Tax. Eight per cent of that tax is the

provincial portion of the tax, and 7 per cent of the tax is the federal portion

of the tax. It is 15 per cent. Although, we all know that a year or so ago the

Harper government in Ottawa reduced the federal portion of the tax from 7 per

cent down to 5 per cent, so that the Harmonized Sales Tax that exists in this

Province is 13 per cent as opposed to the original 15 per cent.

Mr. Speaker, we know that some provinces I know the Government of Nova

Scotia has recently increased the provincial portion of their tax from 8 per

cent to 10 per cent, taking over the two points that the federal government had

relinquished. I know that the Government of New Brunswick, I understand they are

under some pressure to maybe introduce that tax as well, although the Premier of

that province has indicated they are not prepared to go there.

When the Harmonized Sales Tax came in, the Comprehensive Integrated Tax

Coordination Agreement, or CITCA as it is known, governs the way in which the

Harmonized Sales Tax is administered and collected in this particular Province.

Every province that has harmonized their respective sales taxes with the federal

Goods and Services Tax has such an agreement in place. It has been in place, as

I said, since 1997 when the government of the day elected to harmonize. New

Brunswick and Nova Scotia also joined with us at that time and they signed the

original CITCA, as did our Province.

Mr. Speaker, on July 1 of this year, two more provinces are now going to

harmonize their Provincial Sales Tax with the federal Goods and Services Tax,

and that is Ontario and British Columbia. It has been happening in British

Columbia with a great deal of controversy. Under the terms of their agreements,

their CITCAs, both British Columbia and Ontario have obtained a broader tax

policy flexibility than we had, and Nova Scotia had and New Brunswick had, in

the original 1997 agreements signed by the original participating provinces; New

Brunswick, Nova Scotia and Newfoundland back in 1997.

Under the terms of that agreement that we signed, there was a clause that

said if any other province harmonized their sales taxes with the federal

harmonized provinces would have an option. The option would be to either

continue with the same agreement or to enter into new agreements on the same

terms as found in the new provinces.

This Province now has a choice, and we are making that choice. As I said, we

could have continued under the old agreement, but we have decided to exercise

our option to enter into a new agreement, as Nova Scotia has already done. As I

said, they increased their portion of the HST from 8 to 10 per cent, effective

July 1, 2010, in order to meet their fiscal requirements. That is not our

intention, Mr. Speaker, but we did feel that we should enter into this new

agreement because it will provide us with more flexibility to do so.

Under the new agreement, we are still bound by the federal tax base. Under

both agreements, the old one and the new one, we agreed when we harmonized the

taxes that we would accept the tax base under the Goods and Services Tax, but

under the new agreement we will now have more flexibility over the tax rates.

Under the previous agreement, in order raise the provincial portion of the HST

there had to be an agreement of the majority of the three provinces. Two of the

three Atlantic Provinces would have to agree to increase the tax, and if we

wanted to reduce the HST, unanimous agreement was required by all provinces.

Under the new agreement, we will now have the complete flexibility to make that

decision on our own without the necessity of seeking any agreement from any

other province. We have flexibility over the tax rate. Another thing under the

old agreement, if I recall correctly, you could only increase the taxes by 0.5

per cent at a time. Under the new agreement we will have the flexibility to have

complete control over what the rates will be, whether they go up or down.

We also have more flexibility with respect to point of sale rebates on the

provincial portion of the tax, as long as it meets certain conditions. The other

advantage is that our HST of course, our HST is administered and collected by

Revenue Agency. There was no point in having two sets of administration to

collect what is essentially one sales tax. The Canada Revenue Agency collects

that tax, they administer that tax, and of course, they send us our share, our 8

per cent.

Mr. Speaker, by entering into this new agreement it is necessary to amend the

Tax Agreement Act and regulations which came in, in 1997. The legislation dates

from the introduction of the HST, and the purpose of that act was to implement

the original CITCA, the original agreement. Certain elements specific to that

agreement will need to be amended in order to have consistency with the new

CITCA. In addition, there are a number of elements that are now obsolete. They

are simply not needed and should be repealed. An example of these obsolete

components of a former agreement include provisions that related to transitional

measures, tax inclusive pricing, and a covenant not to impose a tax under the

Retail Sales Tax Act, which had not, at that time, been repealed. That act has

now been repealed.

As I have said, the provincial portion of the HST is administered, enforced,

and collected by the Canada Revenue Agency on behalf of this Province and the

provincial portion of the HST is administered, enforced, or collected by the

and the Province and modernizes our provincial legislation to reflect the new

agreement.

Mr. Speaker, the amendments are relatively technical.

Section 1 just updates

the title of the act. It will now read the Tax Agreement Act of 2010. In

section

2, the definition section, the

definitions are the same as in the original act;

so there is no change there. In

section 3, there is the removing of the

reference to the original date of signature. In

section 4, there is a

non-application of the Retail Sales Tax in terms of the importation of vehicles

from outside Canada. In sections 5 and 6 - that deals with the agreement and

with confidentiality - there has been no change here. Former sections 12 and 13

of the original act governs the exchanging and sharing of information related to

the HST and how this information can be disseminated for the purposes of the

administration and enforcement of the legislation. Under

section 7, authority to

make regulations, has provided to allow for the granting of refunds for rebates

and other reimbursements of the HST.

Section 9 substitutes

section 22 of the

former act with respect to the commencement date.

Mr. Speaker, I think that is the bones of it. In terms of point of sale

rebates, that is something we can now take a look at. There are certain

conditions on point of sale rebates. Of course, we can do our own rebates if we

want to administer them ourselves. For example, we have a Home Heating Rebate;

it is not a point of sale rebate. The federal government has indicated to us

they are not prepared to allow a point of sale rebate for electricity or home

heating. We have our own Home Heating Rebate program, which we administer out of

an office that has been established in Grand Falls-Windsor. Of course, we can

continue to do that any time we wish to have a rebate.

In terms of future rebates, obviously, when we go through the Budget process,

we review our revenue measures, including the HST; and those are something that

could be considered at that time. The point of sale rebates will be allowed if

the total value of the rebate does not exceed 5 per cent of the estimated tax

base for the Province and is subject to the availability of a sufficient

database to capture the tax expenditure. On this basis, the rebate room

available to our Province is about $30 million, a net of the existing

Newfoundland and Labrador book rebate. The 5 per cent tax limit, as I said, does

not prohibit the Province from introducing any other self-administered rebates.

One other small change is that the HST will now be paid to us weekly as

opposed to monthly, and that means that we will have the money earlier so we

will earn a little bit of interest. As everybody knows, interest rates are low

right now; but, at some point in the future, they will go up again, and we will

earn some more revenue.

The HST to this Province is about $766 million this year. With 1 per cent on

investment, that might mean an extra quarter of a million dollars a year in

additional revenue for the Province. So, it certainly will help. Again, this

gives us more flexibility over the tax rates. We still have to deal with the

same tax base because the HST is a value-added tax, and one of the principles of

a value-added tax is that you have a large base and that way you can keep the

tax low.

Obviously, as Finance Minister, I get letters all the time from people who

say: Take the HST off this particular purchase and take it off this particular

purchase. Of course, if you continue to make exemptions, what eventually will

happen is you will have to start raising the rate because with taxes it is a

middle ground. People do not like to pay taxes - we know that - but governments

need revenue in order to provide the services that the people demand we provide.

With that, Mr. Speaker, I look forward to the comments from members of the

Opposition and other members of the House, and I would urge passage of this

bill.

Thank you, Mr. Speaker.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER (T. Osborne): The hon. the Opposition House Leader.

MR. KELVIN PARSONS: Thank you, Mr. Speaker.

I appreciate an opportunity to have a few words with respect to this piece of

legislation, Bill 46; however, I would be remiss if I did not comment that we

are here debating legislation and it is very disheartening when you are expected

to get up and debate and respond to what the minister himself admits is a very

comprehensive, a very complex, and a very technical piece of legislation, and

the Opposition, who are expected to respond, only gets the legislation sometime

this week. We are here this afternoon, four members in the Opposition, we get

these complex tax bills, which we have here, and we are expected to get up and

give a comprehensive response. For example, we have a bill coming up here this

afternoon on Abitibi, giving properties and utilities back to Enel and

Newfoundland Power, and we got that bill yesterday.

MR. SPEAKER: Order, please!

I ask the hon. Opposition House Leader: Is this a point of order, or are we

debating the particular piece of legislation?

MR. KELVIN PARSONS: Well, we can call it a point of order, Mr. Speaker,

because it needs to be said here. This is very important. People need to know

and members of the House need to know. Government members need to know and we

need to know how the process works here. If we are going to make this

institution function properly and effectively, it needs to be said. When you get

a comprehensive piece of legislation, for example, involving Abitibi and what

happened in the expropriation and we are here today dealing with pieces - not to

say Opposition are going to be offside with it, not at all, but we have to

understand things if we are going to be able to respond. To be given a piece of

legislation at 4:00 o'clock or 5:00 o'clock on an afternoon and come into the

House the very next day and be expected to respond to it. We were offered a

briefing at 11:30 this morning, by the way; 11:30 this morning they said: Do you

want a briefing on some of these things in this particular bill we are

discussing here?

Now, the minister himself admits that he has a problem, and I certainly have

a problem dealing with the technical pieces of this. You are offered a briefing

at 11:30 a.m., an hour or two before you come into the House. It is just

unacceptable. If government are expecting - or maybe that is the point, they do

not want a comprehensive debate in this House. The point is there is lots of

time to get this done. If government has had this on the agenda - this agreement

did not get negotiated yesterday - there is lots of time for the government to

get its House in order, put the legislation in the proper process so that

members of the Opposition have time to digest it, to read it, to analyze it, and

then come in here and have a full-scale debate on it. That is the point, Mr.

Speaker.

Now, with regard to this bill, it certainly is complex. The old HST regime,

of course, goes back to Prime Minister Brian Mulroney's time and considered one

of the major things that he accomplished. Of course, then we get into changes on

it through the Chrtien years, the Paul Martin years and so on.

MR. SPEAKER: Order, please!

Does the hon. the Government House Leader wish to respond to the point of

order?

MS BURKE: Yes, Mr. Speaker, I assume we are moving the point of order.

Mr. Speaker, we would like a ruling. If we have done anything incorrect in

the distribution of the bills, we certainly would clear up the situation. Mr.

Speaker, if the government has done anything that is not appropriate here in the

distribution of bills, we look for your ruling on that. We feel that we have

followed the procedure that has been set down in the precedents -

SOME HON. MEMBERS: Oh, oh!

MR. SPEAKER: Order, please!

The hon. the Government House Leader.

MS BURKE: We feel that we have distributed the bills as per the

precedents set in the House.

SOME HON. MEMBERS: Oh, oh!

MR. SPEAKER: The Chair has recognized the hon. the Government House

Leader. I would ask all hon. members to allow the Government House Leader to

respond to the point of order.

MS BURKE: Mr. Speaker, if there is any ruling on the point of order, if

it is a point of order that you would be ruling on, we are certainly willing to

do anything that we feel is necessary to make sure we follow the Standing Orders

or the policy within the House of Assembly. Mr. Speaker, we feel we have acted

well within the set policies of this House.

MR. SPEAKER: Order, please!

The Chair will take both arguments under advisement. I will get back to the

House after reviewing the comments made by the Opposition House Leader and the

Government House Leader at a later point this afternoon.

The hon. the Opposition House Leader.

MR. KELVIN PARSONS: Thank you, Mr. Speaker.

With regard to this particular piece of legislation, we wholeheartedly agree

that it is a very technical piece here. I am sure our viewing audience, my good

friend Joe, who I always talk about, is gone for his cup of tea long before now

when it came to considering this particular piece of legislation. When it is a

complex bill like this, you need lots of time to get your head around it. You

need time to study it, but we have taken the time that we have been allowed and

permitted to discuss this piece of legislation. Hopefully, our comments will not

be lost and we have grasped something from this very complex bill in the short

time, the restrictive time, we have had to deal with it.

A lot of the other provinces, of course, are having problems with this issue

too. Premier Campbell in British Columbia recently it is such a complex and

impactful bill on the population sometimes that it leads to dire consequences.

It actually led to his resignation. Part of the big question was the HST. That

is what we are dealing with here, of course, in terms of trying to come up with

a proper formula whereby the feds who deal with the HST portion and us, as a

Province, who deal with our tax regime can co-ordinate things to the best

benefit of everybody. If you do not need a dual system for taxation, if you can

complement each other and everybody get their just desserts out of the tax

regime, that is what it is all about. Obviously, that has to be tweaked from

time to time in order to make sure that it is working the best that it can for

all concerned.

I notice the minister talked about us having an option at this point in time

as to which way we wanted to go: Keep the old agreement that we had, or we had

the option, of course, to negotiate a different agreement. It is sort of called

a me-too clause in labour lingo. We decided that another deal came along that we

feel now is better for us, so we have opted on to that me-too, and we want to

negotiate, the minister is saying, a better opportunity, a better arrangement

for us, administratively, for carrying out of this process. We are supportive of

that. Whatever is to the benefit of the Province, when it comes to having a

streamlined and I do not know if you can get such a thing as a streamlined

process when it comes to some of these tax regimes, just because they are so

complex, is great to have. We do have the flexibility.

I think it is very important that we, as a Province, instead of having to get

the consent, any more, of other provinces, as the minister alluded to, are able

to have a different tax rate. Now we have chosen we are going to be able to

establish solely, wholly, without anybody interfering or trying to suggest or

control, we have the option of putting our own tax rate there. I think that is

very important, because not all provinces have an equal opportunity, or are in

an equal position financially, fiscally, to have the same tax rate.

For example, Prince Edward Island, which is in a different situation than

Newfoundland financially, fiscally, might decide that well, we have to leave our

rate at a certain level. We, as a Province, if we are now a have province,

better off financially, we might decide as a Province we do not need as high a

tax rate as we have. We might want to lower the tax rate. So it is great to see

that that flexibility is there.

One wonders, of course, how we had that in the first place; why other

provinces had that control. I guess that is pretty well irrelevant now, since we

are not going to have it anymore, but it is certainly important that we have

that.

The only other comment I would make, and maybe the minister can give us some

explanation of this in his

summary or later on, deals with the point of sale

piece. Now, the minister indicated, we all know we have a rebate program in this

Province when it comes to people who consume oil, for example. The minister

alluded to the fact; I believe he said that the feds had a problem with us doing

it on electricity bills; yet, we have just negotiated an agreement now, that is

the one we are here talking about.

I am wondering why we did not negotiate it in here such that we could have a

similar program for our electrical as we already have for our home heating, and

why it was not possible to do that in this particular case. I understand before

if the feds said no, but if we were in to negotiations and we had the

opportunity to do so, was it raised? Why did the feds continue to insist against

it? What bargaining chip did they have that made it impossible? Is there some

kind of legal way they can refuse us that opportunity? Did we push the issue

firmly enough? Why did we not succeed in getting it? In this Province,

regardless of where you are, your heating bills can be astronomical when it

comes to the winter time. It is great to see that we should, if we could, have

such a program.

We will be supportive of this particular piece of legislation. It is, as I

said, an administrative thing basically, but I think the most important piece

here is that we have the control and the flexibility now that if you want to

change your tax rate the portion of the combined taxes that that is totally

in the hands of this Province now and you are not subject to the wishes of

anyone else in order to do so.

Thank you.

MR. SPEAKER: Order, please!

Before I recognize the hon. the Member for the District of Signal Hill-Quidi

Vidi, the Chair has looked in both Beauchesne and in the Standing Orders.

Standing Order 83 states: "All Bills shall be printed before the Second

Reading." One can only assume from that as there is no reference to the

distribution of bills that as it requires a bill to be printed prior to second

reading that would also include the distribution of the bill prior to second

reading. There is nothing either in Beauchesne or in the Standing Orders

that would require a briefing. I understand a briefing was offered today, prior

to second reading, but there is nothing in the Standing Orders or in

Beauchesne requiring a briefing by government or a minister on any

particular piece of legislation. So I can only find that government has followed

the proper protocol in the first reading, printing, and distribution of the bill

prior to second reading.

The hon. the Member for the District of Signal Hill-Quidi Vidi.

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

I am happy to stand and speak this afternoon to Bill 46 which is

an act to

implement the comprehensive integrated tax coordination agreement a mouthful

between the federal and provincial governments I do not need to read out the

names of governments.

Taxation, yes, can be boring but there are some interesting things in this

piece of legislation that the minister has pointed us to that I would like to

speak to. As we know this bill does have to do with the harmonized tax regime

that we have between the federal and the provincial governments in this country,

the HST. A tax which caused many problems at the time it was first introduced;

there has been tremendous controversy over this year in some other provinces

in Ontario and BC because they do not have it yet it is in process. I think in

BC in particular there is a movement to undo a decision by government to take

part in HST.

HST itself was a very controversial tax because, of course, it added in

services and goods that we were not used to having taxes on. So it not just

brought the two levels of government together; it added new components to tax.

That was the biggest controversy at the time it was first brought in the HST

itself and that was the big controversy that has just gone on in BC and in

Ontario in the new harmonization between the provinces and the federal

government.

So the debate has not finished in this country with regard to HST and the

harmonization of HST. We had it a longer time than they did in BC and Ontario;

they are just new to this discussion. We have, I guess, in one way learned to

live with it, but I think we have to continue to learn how to use it to our

benefit. So one of the things the minister pointed out, which I think is an

extremely important point, is that the amendments will allow the provincial

government to change rates. I think that is extremely important.

The minister also said something which I find a little bit confusing and I

will be asking him to give us some clarification on it. He talked about the

whole issue of refund, rebate, and reimbursement, which I think is very

important.

Section 7 of the bill says: "The Lieutenant-Governor in Council may

make regulations (

a) respecting a refund, rebate or reimbursement of an amount

equal to a tax paid by a recipient under" a

section "of the Excise Tax Act

(Canada) and in accordance with the agreement". It is saying that the

Lieutenant-Governor in Council of this government may make regulations.

Then the minister went on to say, and used as an example the tax on home

heating, and said: For example, we have a refund and we did that refund. First

of all the refund was just on oil and then it got extended to electricity. So we

were able to do that in the old regime and we are still able to do that is my

understanding. Now, what the minister said was that while the Province can do

refunds or reimbursements and rebates, I imagine while we can do rebates and

as I said, I imagine, refunds or reimbursements we cannot do them at the point

of sale. Yet, I find it strange, Mr. Speaker, that in Nova Scotia their tax is

taken off home heating, and it includes oil and electricity, and it is allowed

to be done at the point of sale. I do not understand why something there it is

the whole tax, it is just not on it, and that is at point of sale. I cannot

understand why something that is allowed in the agreement between another

province and the federal government should not be allowed in the agreement

between this Province and the government.

I will ask the minister to explain: Did they really explore this? Did they

really push for it? The only thing I can think is that they did not, because why

would Nova Scotia have it and we not have it? It looks to me like we would have

the ability to have the tax removed at the point of sale. Why would this

government not do it?

Now, the minister did speak to the fact that it would lead to a loss of

revenue. Yes, it would lead to a loss of revenue, Mr. Speaker. However, we are

talking about something that is being taxed that is a basic necessity of life.

Living here in the northern hemisphere, having home heat is a basic necessity of

life. The issue is having a tax on something that is essential to life. People

cannot live here in the north without heat; we would freeze to death if we do

not have it.

I am asking the minister, would he explain how a loss of revenue from this

sector can be balanced off against the potential loss of life for people who do

not have enough heat? I would like to challenge the minister to be more creative

in thinking about if tax was removed for home heating, both oil and electricity,

where other revenues could be brought in. I think there could be other things

done to the taxation system to make up for that loss of revenue, Mr. Speaker. We

could, for example, create another tax bracket here in this Province, have four

tax brackets instead of three, and tax the highest earners in this Province more

money by having a fourth tax bracket. Then, we could make up for a loss of

revenue by having a retail tax on home heating.

Mr. Speaker, it seems to me that this agreement, on the surface - and I have

not had time to go into detail studying this, and I do want to make that point.

On the surface, it looks like we do have the ability to take off the tax or to

do it by making it a refund or a rebate, or reimbursement, call it whatever you

want, and do it at the point of sale, if it can happen in another province.

That is my biggest beef, Mr. Speaker, with the bill. It is not with the bill

itself, because I think perhaps we can do what the minister is saying we cannot.

I am very serious in saying I want a full explanation of why he is saying we

cannot when it does happen elsewhere. Where in this bill does it say we cannot

do it? That is what I would like to know, Mr. Speaker.

Thank you very much.

MR. SPEAKER: If the hon. the Minister of Finance and President of

Treasury Board speaks now he will close debate on Bill 46.

The hon. the Minister of Finance and President of Treasury Board.

MR. MARSHALL: Thank you, Mr. Speaker.

Although the agreement is complicated, basically the changes we are making

here are in reality relatively simple. The new agreement we are going to sign,

as I indicated, gives us more flexibility over the tax rates. We will no longer

have to seek the consent of Nova Scotia and New Brunswick, who used to be in an

agreement with us. If we wanted to raise our HST tax and, of course, we have

no intention of doing that, but if we did - if we determine that we wanted to do

something like raise the HST and maybe lower another tax, then we can make that

decision. The government of this Province can make the decision with the

approval of the Legislature, which we cannot do now under the old agreement.

Under the old agreement we need the approval - there is New Brunswick,

Newfoundland and Nova Scotia in that old agreement, and two of the three would

have to decide. Also, if we wanted to lower the tax, under the old agreement all

three provinces - Newfoundland and Labrador, New Brunswick, Nova Scotia - it

would have to be unanimous to lower the tax. Now, under the new agreement, we

will have complete flexibility on our own. If we want to lower the tax we can

certainly do so.

We are still bound by the tax base, but we do have authority to issue the

rebates. Before I get into that, I want to refer to the comments that the Acting

Leader of the Opposition and the Leader of the New Democratic Party made with

respect to time to review. When new legislation is brought forward, of course,

it is the minister responsible for that department who will be given the bill,

or be given the draft with some background information. As that goes through the

Cabinet process, it will go through a Cabinet committee, it could be the

Treasury Board Committee of Cabinet, it could be the Economic Policy Committee

or the Social Policy Committee for Cabinet. I have to say, I have to tell the

Acting Leader of the Opposition that, basically, I was given the material; you

read it, you take the time to read it and you bring it forward. I, myself, did

not have any special briefings

MR. KELVIN PARSONS: You had more than an hour.

MR. MARSHALL: I had more than an hour. Yes, I certainly had more than an

hour.

It is interesting, when I got back from my meeting last night - I got back to

the office and saw that the Opposition had requested a briefing. Of course, I

authorized the officials right away to provide the briefing, but I said they can

only provide the briefing on the condition that they also give it to me; but,

obviously, it is a good point that they are making. That complicated

legislation; it would certainly be helpful if the Opposition had received it

earlier so that we could have an even more informed debate.

The other thing that this legislation does - and I said this in my remarks

earlier - is that while we are bound by the same tax base as the GST, we of

course could always give rebates. We can make the decision, if we make it in

this House, if government makes a decision that is endorsed in this House,

government can provide rebates. Now we can do those rebates on our own. As I

mentioned, we give a rebate with respect to home heating. That is on oil and on

wood and on electricity that people use to heat a home. We rebate it for people

whose incomes, if I recall, up to $40,000 will get the rebate. The rebate amount

is $250 on the Island and for Labrador it is $500, because their cost of heating

is much more expensive than it is here, and their heating season is longer than

it is here, and it is colder than it is on the Island.

We always have the right and the ability to set up a rebate system and do it

ourselves. What is happening here is we are talking about point of sale rebates,

and we already have one here, books. I think when you buy a book the HST right

at the point of purchase is rebated. We are giving authority in this legislation

to go to the federal government and to set up a further point of sale rebates

where - there are certain conditions that have to be met. Now I know that some

provinces - like Nova Scotia and British Columbia and Alberta - have point of

sale rebates for things like, I think children's booster seats and children's

clothing and diapers, and I think feminine hygiene products, for example. So,

that is something that we could do.

Now with respect to my comments about the HST on heating, I may have been

mistaken. I know in Nova Scotia, that Nova Scotia has tried to get a point of

sale rebate - it is either electricity or oil, one of the two - and the federal

government has said no to that. Therefore, they said no to us as well. They were

not prepared to do that. Of course, if we want to give the rebate we can set up

our own system and do it as we are doing on home heating fuel, as we do right

now. We always have that option to do it on our own. With respect to point of

sales, we can do it but we obviously need the consent of the federal government

because they are the ones that are administering and collecting the tax. When I

go back to my office, I will seek additional information, and I will be happy to

share it with the Leader of the NDP and the Leader of the Opposition.

Mr. Speaker, with that, I would thank hon. members for their comments and

would urge passage of this legislation.

MR. SPEAKER: Is it the pleasure of the House that Bill 46,

An Act To

Implement The Comprehensive Integrated Tax Coordination Agreement Between The

read a second time?

All those in favour, aye'.

SOME HON. MEMBERS: Aye.

MR. SPEAKER: All those against, nay'.

Carried.

CLERK: A bill,

An Act To Implement The Comprehensive Integrated Tax

Newfoundland And Labrador. (Bill 46)

MR. SPEAKER: This bill has now been read a second time.

When shall the bill be referred to a Committee of the Whole House?

Now? Tomorrow?

MS BURKE: Now, Mr. Speaker.

MR. SPEAKER: Now.

On motion, a bill, "An Act To Implement The Comprehensive Integrated Tax

Newfoundland And Labrador", read a second time, ordered referred to a Committee

of the Whole House presently, by leave. (Bill 46)

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

MS BURKE: Mr. Speaker, I call Order 13, second reading of Bill 44.

Motion, second reading of a bill, "An Act To Amend The Income Tax Act, 2000

No. 3". (Bill 44)

MR. SPEAKER: The hon. the Minister of Finance and President of Treasury

Board.

MR. MARSHALL: Mr. Speaker, it is, again, my duty to speak to the

principle of this legislation in the House today. If Joe and Martha went and got

a cup of coffee for the previous act, I would suggest they stay in the kitchen

for this one because it does not get any better.

Mr. Speaker, this bill is an amendment to our Income Tax Act, and it is a

number of technical amendments to our income tax legislation. As I said earlier,

our personal income taxes, our corporate income taxes, and our HST is

Revenue Agency. We administer and collect certain taxes on our own, our mining

tax and other taxes; but the personal income tax, which is a big one, the HST,

which provides, I think, a billion-and-a-half dollars in revenue to the people

of this Province, are administered and collected for us by the Government of

Canada. That is why, sometimes, when we do our Budget and we do our mid-year

update, we need information from them; because they are collecting it and they

are going to tell us what it is, and then we wait and they will tell us an

adjustment, maybe six months later.

In the act, Mr. Speaker, there are a number of technical amendments, and I

will deal with them briefly, Where you have two parents who are separated but

they share custody of their child or their children on an equal or near equal

basis, that is the situation we are dealing with. There are certain federal

benefits administered by the Canada Revenue Agency such as the Canada Child Tax

Benefit, the Universal Child Care Benefit, and the GST, HST credits for the

child. In the past, the benefits were given to one of the parents for six months

and then it was given to the other parent for another six months. Then, in this

year's federal budget, the federal government changed that so that each of these

credits that would be paid out, would be split 50-50 between the two parents.

It was the same here in Newfoundland and Labrador for certain refundable tax

benefits that is administered for us by Canada Revenue Agency. I am referring to

the Newfoundland and Labrador Child Benefit and the HST credit for that child.

Again, for us, it went to one parent for six months and went to the other parent

for six months as well. So, the first amendment is to change that so that

benefits administered for the Province on the Newfoundland and Labrador Child

Benefit and the HST credit will also be split equally by the parents 50-50, the

same as the way the feds are administering the federal benefit.

Currently, the Newfoundland and Labrador Child Benefit and the HST credit for

that child are administered free of charge under the provisions of the Tax

Collections Act. Diversion from the federal proposal would create a difference

that would trigger provisions that require administrative fees to be charged to

the Province. We do not know what those charges would be, but we are told that

they would be significant. We are going to harmonize the treatment of benefits

for the Newfoundland and Labrador Child Benefit and the HST tax credit to mirror

what is happening with the federal benefits.

Mr. Speaker, the second amendment is to deal with the Scientific Research and

Experimental Development Tax Credit wording. The Scientific Research and

Experimental Development Tax Credit is a refundable credit of 15 per cent of

eligible expenditures made with respect to a scientific research and

experimental development activities that are carried out in the Province. The

credit is based on the parameters and the

definitions of a similar credit

offered under the Income Tax Act of Canada, albeit with a different tax rate.

Both the federal and provincial programs are administered by the Canada Revenue

Agency.

There is a minor technical amendment proposed to our legislation here in the

act, which I am moving, seconded by my colleague, the Minister of Justice and

Attorney General for the Province. The wording in our act refers to an eligible

expenditure made in the previous taxation year, which is not necessary. The

credit is fully refundable, which means that a taxpayer receives the benefit of

the credit in the year in which the taxpayer spends the money regardless of the

amount of tax otherwise payable in that year. On that basis, Mr. Speaker, there

is no reason for our legislation to refer to expenditures made in a previous

year. The CRA has suggested that we amend that act to remove the reference to

the previous year and we delete it. That is one of the things, one of the

amendments that this legislation does. Our legislation will then support the

current Canada Revenue Agency administrative practices in the way they are

dealing with that provincial credit.

There are two other minor amendments, Mr. Speaker, that both deal with

definitions. One is the definition of the words qualified relation with respect

to the low-income tax reduction. The low-income tax reduction is a very

important piece of our personal income tax system. It is a personal income tax

reduction for low-income individuals and families. For the 2010 taxation year,

the program is going to eliminate from provincial income tax individuals with

net incomes up to $16,022 and families with a net income up to about $26,811.

Partial tax reductions are going to be received by individuals with a net income

of up to $19,535 and for families who have net incomes up to $32,086.

The low-income tax reduction income thresholds are increased annually,

utilizing the provincial Consumer Price Index. This reduction eliminates

low-income people from paying any income taxes at all. I think, in our first

year in office we brought that in, and then one year later, I think, in the

Budget of my colleagues, the Minister of Health and the Minister of Finance,

that was enhanced further and, of course, we also indexed this credit so that it

gets higher each year along with the cost of living.

Mr. Speaker, as I said, some

definitions in the acts use language that is

similar to the federal Income Tax Act while others use a different definition.

Adjusted income, which is used in determining the amount of a low-income tax

reduction - which I previously mentioned - was previously defined in the act and

set out its own parameters in detail. Unfortunately, this led to a conflict in

some unintended differences between the two acts, the federal act and our act,

when changes are made by the federal government to their legislation.

The federal government is currently administering our low-income tax

reduction based on the federal definition of adjusted income, and that removes

payments from registered disability savings plans as well as other adjustments.

If this change was not implemented, as set out in this legislation, and the

current provincial definition was continued to be used then some residents of

the Province would be negatively impacted and would no longer be eligible for

the low-income tax reduction. Therefore, we want to amend the definition to

utilize the federal definition so that these people will continue to receive the

benefit and these families will continue to receive the benefits of these

reductions and therefore not have to pay any personal income tax. The amendment

will be retroactive to January 1, 2005, which is when the low-income tax

implementation was implemented. I think that all members of this House will be

very happy to support this particular amendment because of the benefits it will

provide to low-income families in this Province.

Mr. Speaker, an amendment will also be made to the definition of qualified

relation that is contained in our Income Tax Act. The change will now consider

qualified relation to include a deceased spouse or a common-law partner who died

during the taxation year. This will allow a taxpayer who has had a spouse or a

common-law partner die in that year to be eligible again to claim the

lower-income tax reduction for the taxation year as a family. The income

thresholds to determine eligibility for the low-income tax reduction are higher

for a family than for a single individual, and this change will benefit widows

and widowers who find themselves in this particular situation.

Mr. Speaker, those are the four technical amendments that are set out in the

legislation. Two definition changes; one is a change in the administration of

benefits so that they will be split between the parents who are separated but

who have joint custody of a child, so that they share in the benefits. The other

is a minor amendment to the scientific tax credit.

I would urge passage of this legislation, Mr. Speaker.

Thank you.

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

MR. KELVIN PARSONS: Thank you, Mr. Speaker.

I will start off my comments by saying I have to take the minister at his

word. Based upon what he has told us here today, I am certainly not in the

position to refute what he is saying. The reason I am not in a position to

refute what he is saying is because I have absolutely no idea what he is saying.

In fact, I challenge the other forty-six members of this House to get up and say

that they know what he is saying, because the minister himself, admittedly, is

dealing with a very complex matter here.

Maybe he has a whole battery of tax experts or accountants, fiscal people to

crunch the numbers for him and tell him what the policies are all about. So he

has that benefit, but the rest of us, we get this stuff maybe eighteen to

twenty-four hours before we come here and we have to read it, digest it,

understand it, and vote upon it. That really bothers me because I hate to vote

upon things that I do not understand, but I realize as a member of the House, if

we are here we are required to vote one way or the other. I do not want to vote

against it because I do not understand it. Therefore, I have to take him at his

word and I will vote for it, but that does not mean I understand it, and I

readily admit that.

Now, I understand it is an administrative issue. I understand it is dealing

with tax issues and that from time to time they change, and maybe we are not

expected to understand the intricacies of how it works. As long as we know that

it benefits the people here somehow, if it benefits seniors and certain spousal

groups, for example, that is good stuff. I want to be upfront and clear about

that. I do not want anybody out there in TV land to think that I understand what

this is about intimately and so on because I do not understand the nuances of

exactly what is here.

Again, I have to take the minister at his word. It is beneficial for these

people, it is administrative in nature, and it is streamlining the process so

that the best benefits that can be gotten for the people of this Province, the

certain stakeholders and groups in this Province, that is what we get. I just

wish, Mr. Speaker, again, that government could provide us with this stuff in a

timely fashion so at least we could get to do justice to it from a reading point

of view. At least we would get an opportunity to read it.

With regard to the complexity, we do not have a whole battery of resources

available to us. We did go to the briefing that the minister arranged, I think

it was an hour or so before we came here to the House of Assembly, and the

researcher who went down to try to get his head around it came back absolutely

befuddled. He could not even eat his lunch. He was so upset because he could not

grasp anything from the briefing. He was questioning his own intellectual

abilities. Then he said: I realize that the person giving me the briefing did

not understand what he was saying either, or he was not doing a very good job of

it.

These things are complex, and the more lead time we can have to understand it

the better. We thank the minister for at least his attempt at explaining what

this is all about. I am not certain that he understands himself the intricacies

of it, but based upon that, we will at least be voting for it rather than object

to something that we do not know the details of, from an objective point of

view.

Thank you.

MR. SPEAKER: The hon. the Member for the District of Signal Hill-Quidi

Vidi.

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

Bill 44, an income tax act amendment. They are complicated, and I am

certainly not going to get into the complicated formulas that are talked about

in this amendment. That is probably the big thing, the complication of the

different formulas that are here. I am going to leave that to the tax heads who

put it together and who know that these formulas work out.

There are some issues that come up in this bill that I would like to speak

to. Some of the positives, there are practical positives here that will benefit

people. The minister has mentioned some of them but I would like to mention them

again with just a little bit more information.

The new provisions with regard to the Newfoundland and Labrador Child Benefit

- which includes the nutritional supplement, which I think is excellent - is

something that is really going to be welcomed by parents. We also have new

provisions which apply to the HST credit as well, because under the old

procedure the Canada Revenue Agency would allow only one parent to receive the

benefits with regard to the child benefit for the first six months, and the

other to receive it for the last six months. Now both couples will be able to

get an equal split right across the year, which makes for greater consistency

with regard to your income and figuring out your income, et cetera. That is

really important; it is something that is going to be good for people in the

Province. It does have a practical application.

Another thing in here that is good also has to do with somebody who has been

cohabiting with a spouse, whether the person was married or a common-law partner

and becomes widowed, left alone in the middle of a tax year. Prior to this, once

they became widowed, they automatically, from that point on in that tax year,

were considered to be in a different tax-based reality, because they were single

instead of being part of a couple. There are some tax breaks that are there for

couples; for example, the allowable household income would be different for a

couple than for a single person. There would be expenses that there are tax

breaks for that would be different for a couple than for a single person.

What the new bill will say if somebody loses their spouse through death in

the middle of a tax year, that whole tax year will consider them as having been

part of a couple, and that is really important. I have had some phone calls

recently that have been important. I have had them from single people who had

been part of couples and all of a sudden, with the death, they are left in a

very different situation. The household income has come down and yet, basically,

the expenses of the household are much the same. There are slight variations in

the expenses of the household. I have had calls, especially from widowed women

who are calling saying is our tax system fair because I have much less income

now with my husband gone, but when it comes to running my house I have almost

the same expenses, and yet the tax system does not recognize that I have almost

the same expenses.

It is a serious issue. I do realize there has to be a difference between the

treatment of a couple and a single person, but several of the examples that have

been brought to me would indicate that a middle- to low-income individual who

all of a sudden becomes widowed no longer has a partner can overnight be

thrown into a very difficult situation.

The minister indicated that the change in this amendment will be helpful and

will make life easier for the person who no longer has their partner, but it

will only be for that one taxation year. I think that it begs a question of

whether or not our system is completely just to the person who is left behind.

Sometimes you hear of individuals having to give up the homes that they had once

the partner dies. Part of the reason is because while they have almost the same

expenses with regard to the upkeep they do not get the same tax breaks as an

individual. It is something to think about.

It is one thing to be talking about the difference between a family of four

or five and an individual, it is another thing to be thinking about a senior

couple say a couple who are seventy-five, eighty and their expenses. When

the partner dies, there is not a big difference in the expenses for the single

person as there was for the couple, when it comes to the household I am not

talking about when it comes to personal expenses like health issues and drugs

and that kind of thing, but when it comes to the household.

So it is something that I put out there as an issue that I do not think our

taxation system takes into account, because I am talking specifically about

seniors who get widowed and who are trying to keep going with the same household

expenses, or basically the same expenses, they had before the spouse died. So,

it is an issue. It is nice to see that in the year that the spouse dies, the

person is going to get a tax break that is good; I am glad to see that, but I

wonder if this is not something that we should be putting more thought into as

governments, both on the federal and the provincial level, with regard to the

needs, in particular, of seniors who become single people overnight because it

always happens overnight; it is not something that you can prepare for and at

the last stages of their life, maybe a single person being faced with having to

give up what they have had as a couple.

This bill, of course, does not deal with that. It does give that little break

during the tax year; it is a benefit. It does help them during that tax year,

but that is about it. It does not deal with them beyond that. It is good, too,

that the definition of qualified relation for the purpose of the low-income tax

reduction has been changed to allow the cohabitating spouse or common-law

partner who died in that year to be considered a qualified relation, because

that was not the case before for determining eligibility.

Having said that, Mr. Speaker, obviously it is a bill that we need to pass.

It is a bill that technically is needed to be put in place, and it does have a

couple of good pieces in it, as I have said, which help people in the Province

with regard to their payment of income tax.

Having said that, I thank you, Mr. Speaker, for the opportunity to speak, and

I will be voting, of course, for this bill.

MR. SPEAKER: If the hon. the Minister of Finance and President of

Treasury Board speaks now he will close debate on Bill 44,

An Act To Amend The

Income Tax Act, 2000 No. 3.

The hon. the Minister of Finance and President of Treasury Board.

MR. MARSHALL: Thank you, Mr. Speaker.

I want to thank the acting Leader of the Opposition and the Leader of the New

Democratic Party for their comments and their support of this legislation. As I

indicated, it is to ensure that our law contained in our acts is in accordance

with the federal act and the administrative policies and procedures that the

Canada Revenue Agency is following in administering and collecting our taxes.

No government likes to put an unfair tax burden on the people of the

Province. This is a measure that takes away some of the unfairness that may

exist in the system. As we identify other anomalies or instances of unfairness

we will be very pleased to correct them. In fact, in terms of taxation, this

Province was at one point known as a very high tax jurisdiction; a place where

the personal income taxes were extremely high. We have taken some measures to

get those taxes down, but it is important always to strike a balance between not

overly taxing the people of the Province and keeping your taxation systems fair.

Also, we need to raise revenues so that we can bring in a lot of the programs

that the people of the Province would expect a caring and competent government

to provide.

We have reduced taxes. Cumulative tax reductions have been $1.2 billion since

2007 and the people are paying now $374 million a year less in taxation than

they were back in 2007. So government has taken its hands out of people's

pockets. It is helping Newfoundland and Labrador families to pay their bills. We

are also ensuring by being competitive that people have a part of their incomes

to invest and that creates jobs and opportunities.

One of the biggest problems we have, that all members of this House

understand and appreciate, is the fact that we have so many people retiring and

so many people eligible for retiring. I have heard that 25 per cent of the

public service is eligible for retirement in the next couple of years. We are

also going to need skilled trades people; we need more health officers and

social workers.

MR. SPEAKER: Order, please!

I remind the hon. minister that we are debating Bill 44 and I ask him to keep

his comments relevant to the particular bill.

MR. MARSHALL: Certainly, Mr. Speaker.

Taxes have been reduced and this bill eliminates some of the anomalies. This

bill co-ordinates and harmonizes the practices of the Canada Revenue Agency with

our law and it helps people who will now be eligible for the low- income tax

reduction. The low-income tax reduction has grown it was $5.3 million in 2005

to $12.5 million in 2010. It was introduced in 2004 by the then Minister of

Finance, and it enabled low-income families and the amendments in this

particular act are affecting this tax reduction. Low-income families back in

2004 could save $416 in provincial income tax, and a family could save $464.

Provincial income tax was eliminated for individuals with a net income, as I

said previously, up to $12,000, and for families this amount has now been

increased to $21,900.

So with that, Mr. Speaker, I thank the hon. members for their comments, and I

would move passage of this legislation.

Thank you, Mr. Speaker.

MR. SPEAKER: It has been properly moved and seconded that Bill 44,

An Act

To Amend The Income Tax Act, 2000 No. 3, be read a second time.

Is it the pleasure of the House that the said bill be read a second time?

All those in favour, aye'.

SOME HON. MEMBERS: Aye.

MR. SPEAKER: All those against, nay'.

Carried.

CLERK: A bill,

An Act To Amend The Income Tax Act, 2000 No. 3. (Bill 44)

MR. SPEAKER: This bill has now been read a second time.

When shall the bill be referred to a Committee of the Whole House?

Now? Tomorrow?

MS BURKE: Now, Mr. Speaker.

MR. SPEAKER: Now.

On motion, a bill, "An Act To Amend The Income Tax Act, 2000 No. 3", read a

second time, ordered referred to a Committee of the Whole House presently, by

leave. (Bill 44)

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

MS BURKE: Mr. Speaker, I would like to call Order 16, second reading of

Bill 47.

MR. SPEAKER: The hon. the Minister of Natural Resources.

SOME HON. MEMBERS: Hear, hear!

MR. SKINNER: Thank you, Mr. Speaker.

Mr. Speaker, I move, seconded by the Minister of Finance, that Bill 47, An

Act To Amend The Abitibi Consolidated Rights And Assets Act, be now read a

second time.

MR. SPEAKER: It is moved and seconded that Bill 47,

An Act To Amend The

Abitibi Consolidated Rights And Assets Act, be now read a second time.

Motion, second reading of a bill, "An Act To Amend The Abitibi Consolidated

Rights And Assets Act". (Bill 47)

MR. SPEAKER: The hon. the Minister of Natural Resources.

MR. SKINNER: Thank you, Mr. Speaker.

Mr. Speaker, in December of 2008, our government took quick and decisive

action when it became clear to us that Abitibi Consolidated was abandoning its

pulp and paper operations in Grand Falls-Windsor, its last location in the

Province of Newfoundland and Labrador.

Clearly, such action left the people of Newfoundland and Labrador, and