November

29, 1993

HOUSE OF ASSEMBLY PROCEEDINGS

Vol. XLII No. 24

The House met at 2:00 p.m.

MR. SPEAKER (Dicks): Order, please!

Statements by Ministers

MR. SPEAKER: The hon. the Premier.

PREMIER WELLS: Thank you, Mr. Speaker.

Last Friday, the Member for Grand Bank made very serious

allegations here in the House against my colleague the Minister of Justice. He

accused the minister of having used his position as a member of Cabinet to

benefit his private interests improperly. The Member for Grand Bank founded his

charges on the statement that - and I'am quoting from Hansard - "each year

government purchases approximately $9 million by public tender or standing order

- most of it by far by standing order - about $9 million value worth of

pharmaceutical supplies. About $6.3 million of that $9 million over the last

number of years has been purchased from Pharmaceutical Supplies (Limited), most

of it by standing order". He went on to say, and again I quote from Hansard,

"that's an unusually high volume of business that's going every year to a

company that's owned outright by the minister and his family."

These are extremely serious charges, Mr. Speaker.

The Minister of Justice, in response, made two statements to

the House. The first is that he had "no idea whether Pharmaceutical Supplies

Limited (supplies) $1 or $1,000 or $100,000 or $1,000,000 -- to the government

of this Province". The second was an assertion that any business done by that

company with the government was done pursuant to the provisions of The Public

Tender Act.

Mr. Speaker, I must tell the House that further information

about this matter has come to my attention over the weekend, and this morning. I

have caused it to be checked out. I believe it is essential that this

information be made public at once because it goes to the integrity of public

life in this Province.

My colleague, the Minister of Works, Services and

Transportation tells me that the Government of this Province have purchased

almost nothing from Pharmaceutical Supplies Limited during 1992 or 1993. To be

precise, the government paid $246.24 to that company during the twenty-two

months that ended on October 31, 1993.

MR. TOBIN: (Inaudible)

MR. SPEAKER: Order, please! I am having difficulty

hearing the figures.

PREMIER WELLS: I recall specific comments the minister

made when he quoted from

Section 21 of the Conflict of Interest Act about the

minister sitting at the Cabinet table and making decisions affecting the health

care of the Province and benefiting his company. I know what the member said. To

be precise the government paid $246.24 to that company during the twenty-two

months ended October 1993. And, lest there be any doubt, let me state that

nothing has been paid by the government either to Armbro Pharmaceutical Limited

or to Elizabeth Drugs Limited, both of which are connected to Pharmaceutical

Supplies. The sole purchase from these companies was a small quantity of

meningococcal vaccines bought by the Health Department in Corner Brook in April

or July 1992.

In short then, there is absolutely no factual basis for the

very serious allegations made by the Member for Grand Bank.

Mr. Speaker, I must go on to tell the House that my colleague

the Minister of Justice, at the time of his entry into the Cabinet, issued

instructions to Pharmaceutical Supplies Limited that it was neither to tender

upon nor to accept any orders from government. He tells me that the management

of the company assured him that these instructions have been honoured. If my

memory serves me correctly a letter was sent directly to the department

instructing the department not to purchase directly from the company. I believe

that is correct. I remember because I issued a similar letter to the department

myself when I became Premier of the Province.

Pharmaceutical Supplies Limited, I'm advised, has sold

substantial quantities of drugs and like supplies to hospitals and nursing homes

throughout the Province.

SOME HON. MEMBERS: Oh, oh!

PREMIER WELLS: Hold on now, I know what the hon. member

said, his statements are on the record. The greatest part of these purchases are

made by the Newfoundland Hospital and Nursing Homes Association, in behalf of

its member institutions. Never one of those decisions comes to Cabinet, Mr.

Speaker, contrary to the inference of the hon. member, not one of those

decisions are made in Cabinet. Some, I'm told, are made directly by the

institutions concerned. All are made in accordance with the provisions of the

Public Tender Act.

AN HON. MEMBER: (Inaudible).

MR. SPEAKER: Order, please!

PREMIER WELLS: None - and I repeat the word - none is

made by the Government Purchasing Agency, which purchases anything bought by

Government.

I am assured that all dealings between Pharmaceutical

Supplies Limited on one hand, and publicly-funded agencies on the other, has

been carried out in accordance with the spirit and the letter of the Public

Tender Act. I remind the House that this legislation has been in effect for a

number of years, and was first adopted at the request of the former Progressive

Conservative administration.

Mr. Speaker, it should be pointed out too that Pharmaceutical

Supplies Limited has had a long business relationship with the Government, which

began many years before my administration took office. My colleague's acceptance

of my invitation to join the Cabinet resulted in a prohibition against that

company continuing that business with the government.

Mr. Speaker, I must tell the House that this matter cannot be

allowed to rest there. I have spoken out strongly and often against the tactics

of character assassination that have been adopted by the Opposition in the last

two or three months. The attack upon my colleague last Friday is a glaring

example of this. Were it not for the fact that he is protected by the immunity

accorded to all members of this legislation, the Member for Grand Bank would be

called to account for his statements by a Court of law and would no doubt have

to account for it. He is aware that he can make such baseless statements here in

the House without having to answer for them. His conduct is not worthy of a

member of this House. He has played loosely with the truth, and can only be

called to answer for it by public opinion.

The member's failings are all the greater because this is the

second time that he has made such reckless charges. Members will recall that he

has made allegations against my colleague the Minister of Education, arising

from a dispute about payment of the insurance proceeds on a crab plant in

Roddickton. The RCMP investigated these statements, at my request, and concluded

that they were completely without foundation.

It is not for me to tell the Opposition how to conduct

themselves. All that I will say, and I say it with considerable sadness, is that

such conduct by the Member for Grand Bank can only draw the House of Assembly

and all of its members into disrepute, and lower the tone of public life in

Newfoundland and Labrador. We have seen far too much of this in the past. I have

worked hard to try and change that state of affairs. I am sure that the Leader

of the Opposition shares my determination to conduct public life in this

Province on a proper basis. I can do no more then to ask him to take the action

he deems appropriate to deal with the reckless conduct of the Member for Grand

Bank.

Thank you, Mr. Speaker.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: Order, please!

The hon. the Opposition House Leader.

MR. W. MATTHEWS: Thank you very much, Mr. Speaker.

SOME HON. MEMBERS: Hear, hear!

MR. W. MATTHEWS: Let me first say to the Premier, Mr.

Speaker, put your own house in order before you tell someone else how to run

theirs. Put your own house in order, you can skate any way you want with your

reference to $246.24 purchased from government, but what are hospitals and

nursing homes in this Province, Mr. Speaker, if they are not - they are funded

by the taxpayers of this Province, decisions made for budgets at the Cabinet

table of which the Premier Chairs and the Minister of Justice sits next to him.

Now you can skate anyway you want, it is public funds, it is taxpayers money and

for the Premier to go on, on page 2. Page 2, I am talking about pharmaceutical

supplies and: has sold substantial quantities of drugs and likes to hospitals

and nursing homes. That is precisely the point, Mr. Premier, that is precisely

the point. $6.3 million of taxpayers money have gone to hospitals and nursing

homes from the taxpayers of this Province, budgeted for by the Cabinet, of which

this minister has sat and made decisions. That is the point.

Now this is public information, Mr. Speaker, public

information. Anyone can go down and get it. It is public information, it is

public funds and the Premier can try to twist and squirm and it is as the Leader

of the Opposition said a few days ago, about the tangled web; that is exactly

what he is trying to do here again, and, Mr. Speaker, it is as plain as the nose

on your face. Who does the Premier think I was alleging that the money went to,

the Junior Red Cross clubs across the Province? Where is the health care budget

of this Province spent, if it is not in hospitals and nursing homes across this

Province? So, Mr. Speaker, I am glad the Premier took this opportunity today

because it is like Clint Eastwood said: Go ahead and make my day, because that

is what you have done, because you have verified everything that I have said on

Friday, and then his reference to the minister, about the minister giving

instructions to pharmaceutical supplies; this came to mind over the weekend, Mr.

Speaker, since Friday. If the minister had given those instructions, I am sure

with his sharp, legal mind, he would have remembered it on Friday, Mr. Speaker,

I am sure he would have. As for the Leader of the Opposition taking action to

deal with me appropriately with my reckless and cowardly behaviour, I say to the

Premier, you can call me anything else in life, Mr. Premier, but don't ever call

me a coward, because that's one thing I ain't, I tell you right now - that's one

thing I ain't!

SOME HON. MEMBERS: Hear, hear!

MR. W. MATTHEWS: You can squirm all you like to try to

get out from under the mess that you've caused in this Province with your

sell-out of Newfoundland and Labrador Hydro, but don't try to turn the tables on

me. Because I'm not the one who is selling out, you are. And the whole issue is

tainted because of the actions of your minister.

With regard to Roddickton, I say to him, there was no direct

inference to the Minister of Education in the Roddickton scam. I will still call

it a scam. There were problems up there, allegations made by the people of

Roddickton, allegations that were brought to me by the people of Roddickton, I

say to the Premier. They weren't my allegations. They were lacking in

representation on the fish plant issue, I say to the Premier. That is why that

happened.

Mr. Speaker, I want to conclude by saying that really today

the Premier has verified that Pharmaceutical Supplies Limited has done very,

very well from the taxpayers of this Province through their sales to hospitals

and nursing homes throughout the Province. I want to conclude by saying, any way

you slice it, Mr. Premier, your Minister of Justice sat at the Cabinet table,

made Budget decisions about expenditures to hospitals and nursing homes, and

Pharmaceutical Supplies -

MR. SPEAKER: The hon. member's time has elapsed.

MR. W. MATTHEWS: - got $6.3 million out of $9 million

and, to me, that is still a conflict of interest.

SOME HON. MEMBERS: Hear, hear!

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

MR. CARTER: Mr. Speaker, the Fisheries Research

Conservation Council has just released the recommendations it is making to the

federal Minister of Fisheries and Oceans for 1994 quotas for groundfish in

Atlantic Canada.

In view of their implications for Newfoundland and Labrador,

I wish to inform hon. members of some of the Council's recommendations.

Overall, Mr. Speaker, the scientific assessment of stocks is

that all stocks are in trouble. This presents another critical situation for the

fishery and its workers, but the news is not unexpected. There has been an

increase in the harvest of juvenile fish of all stocks over the past three to

four years. In many cases, fleets have not been able to catch quotas, and the

spawning biomasses of key stocks are at the lowest levels ever recorded.

With regard to stocks that most directly impact on this

Province, the FRCC is recommending that the Gulf cod fishery be closed; that is,

fishing zones 4Rs and 3Pn. It might be noted, Mr. Speaker, that the Province has

been recommending the closure of that fishery for the past three years.

The Council is also recommending that the quota for the Gulf

redfish stock be reduced to 30,000 metric tonnes from 60,000 tonnes. While

Newfoundland is not the main harvester of this stock, this recommendation, if

implemented, will have a direct impact on that area's otter trawl fleet of

vessels less than sixty-five feet, and will affect offshore plants on the South

Coast, and processing plants in the Port aux Basques area.

In its recommendations, the Council has echoed the Province's

repeated concern for the Northern turbot stock, particularly the

overexploitation of the stock by foreign vessels outside the 200-mile limit. I

agree completely with the Council's view that the turbot fishery outside of 200

miles must be brought under control.

On the South Coast, where the 3Ps cod fishery will be closed

until May of 1994, the Council will be making a recommendation when it has

available the results of the scientific stock assessment that will be undertaken

during this winter.

It comes as no surprise that the Northern cod stock is

showing no sign of recovery, and therefore not unexpected that the Council has

recommended a continued moratorium on this stock.

Mr. Speaker, there are other recommendations, but these are

some highlights. I will be discussing them with the federal Minister of

Fisheries and Oceans on December 16 at a meeting of the Atlantic Council of

Fisheries Ministers.

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

SOME HON. MEMBERS: Hear, hear!

MR. W. MATTHEWS: Thank you very much, Mr. Speaker.

Really, what the minister has done today is he has given us a

brief synopsis of the recommendations that are coming from the FRCC, and none of

us expected very good news. We had hoped it would be better, but I guess we have

to accept the facts and try to make the best of a bad situation.

I agree with the minister when he spoke about the Gulf cod

fishery that should be closed, and that the Province has been recommending that.

He is right, I concur. I think it really should be closed. The impact of the

reduction in the redfish stocks in the Gulf to 30,000 from 60,000 tonnes, as the

minister said, is going to create some difficulties for our processors, workers

in our plants on the South Coast, and particularly in the Port aux Basques area,

so again we get more pain, I guess, coming from today's recommendations.

Now, the minister went on to talk about the turbot, and of

course, the FRCC has made a recommendation about this as well, particularly the

foreign effort outside of 200. Who can disagree with that? It is something that

we have been pushing for, and I mean `we', all of us in this House, any number

of times in the past, have put resolutions calling for the elimination of

foreign fishing outside of 200.

I guess the only thing I can say to the minister there is

that thirty-four days have passed since the October 25 date. That leaves about

fifty-six for the new Prime Minister and his Minister of Fisheries, and the

Premier then, I guess to implement, for us Newfoundlanders, the most important

election promise, and that was that by ninety days all this -

MR. SPEAKER: The member's time has expired.

MR. W. MATTHEWS: - foreign activity on the Nose and Tail

of the Banks was going to stop. There are fifty-six days left and counting, Mr.

Speaker. We look forward to that day when the federal government, the Prime

Minister and the Minister of Fisheries, will implement and get the foreigners

outside of the 200-mile limit.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: Does the hon. Member for St. John's East

have leave of the House?

SOME HON. MEMBERS: No leave!

MR. SPEAKER: No leave.

MR. HARRIS: Thank you, Mr. Speaker.

Oral Questions

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

MR. SIMMS: Thank you, Mr. Speaker. I would like to return

to a favourite issue, a prominent issue in the minds of people of Newfoundland

and Labrador, and that is the privatization of Hydro.

In recent days, during some discussions in debates that we've

been holding on this issue - the Premier and I in particular last Thursday on

public television - one of the main arguments that the Premier gave for selling

Hydro has been that it would improve the credit of the Province by getting rid

of the billion dollar government guaranteed debt. In addition to some

interesting news on the front page of the Telegram this morning with

respect to a poll, which indicates nearly 75 per cent of the people of this

region oppose his idea, and only a little over 7 per cent agree to it, we also

have some striking public comments from two of the government's credit rating

agencies now which have publicly debunked the Premier's claim, and in fact have

confirmed what we've been saying.

For you, Mr. Speaker, I would like to quote. Standard and

Poors of New York told the Sunday edition of The Evening Telegram

yesterday, and I quote: "...[W]e don't foresee ourselves changing the rating as

a result of the divestiture." End of quote. The Dominion Bond Rating Agency

said, quote: "We've always considered Newfoundland Hydro to be self-sustaining,

so we've excluded its debt from our debt calculation" of the Province. Which is

precisely what we've been saying.

I want to ask the Premier, isn't it time for the Premier to

defend this deal with facts, if he has any facts, not with unsupported

speculation and wild exaggerations? Since the credit rating agencies have now

blown his argument, will he now admit that getting rid of Hydro's debt will not

improve the Province's credit rating, will not lower interest rates, and will

not increase the borrowing capacity of the Province, as he has been arguing?

SOME HON. MEMBERS: Hear, hear!

PREMIER WELLS: Mr. Speaker, before answering the question

MR. SPEAKER: Order, please!

PREMIER WELLS: - I would like to have the copy of the

paper from which the member read.

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

MR. SIMMS: Yesterday's Evening Telegram .

PREMIER WELLS: May I have the copy that he was reading?

Because I understand he left out a word.

MR. SPEAKER: Yes, that should be tabled if it's read

from.

PREMIER WELLS: May I have a copy of what he is reading

from? Perhaps the Clerk would pass me a copy of what he is reading from.

AN HON. MEMBER: It was quoted accurately.

PREMIER WELLS: I would like a copy of what he is reading.

When I have the copy I will answer the question, Mr. Speaker.

SOME HON. MEMBERS: Oh, oh!

MR. SPEAKER: Order, please!

MR. SIMMS: Supplementary.

MR. SPEAKER: Order, please!

MR. SIMMS: Supplementary, Mr. Speaker.

SOME HON. MEMBERS: Oh, oh!

MR. SPEAKER: Order, please!

I won't recognize the hon. member until I have order in the

House.

The hon. the Leader of the Opposition.

MR. SIMMS: Mr. Speaker, I guess we see what the answer is

to the question. I guess we will see if the Premier will ever respond to the

question.

I quoted accurately. If the minister thinks I (inaudible) why

don't you tell the Premier what the quote was?

MR. TOBIN: (Inaudible) we've ever seen to it!

MR. SPEAKER: Order, please!

I'm having difficulty hearing the question when members are

speaking across the House.

MR. SIMMS: Mr. Speaker, I would like to ask the Premier

another question with respect to the debt argument that he has tried to put

forward. He used the $250 million as a figure, for the purpose of argument, I

guess. He said that the $250 million in cash that would come from this sale

would be used to reduce borrowing for the next year or two or whatever, and that

that would save up to $20 million a year in interest payments. Now on the other

hand he does admit that government would lose the $10 million that it gets every

year from Hydro from the debt guarantee fee which then reduces the financial

benefit to $10 million. I think that was the argument that he used, according to

the tape that I watched yesterday, in the debate last Thursday.

The real question is, what will be the real cost to the

Province in order to attain that additional $10 million that he talks about? How

many additional millions of dollars will the Province lose in income tax, in

retail sales tax, in other consumer taxes and other municipal taxes, as a result

of direct job losses and indirect spin-off job losses throughout our economy.

Can he answer that question?

MR. SPEAKER: The hon. the Premier.

PREMIER WELLS: Mr. Speaker, I am going to now quote

accurately and fully the quote that was in the newspapers, the comment from

Standard and Poor's, that the hon. member quoted inaccurately. He left out a

very significant word. Here is the full quote, Mr. Speaker: "Credit rating

agency Standard and Poor's of New York, and Dominion Bond Rating Services,

confirm that losing Hydro's debt won't improve Newfoundland's rating overnight,"

- a very important word. They won't improve it overnight. Nobody suggested that

it would improve it overnight, but in the end it will improve it because, you

see, simple logic explains the question.

Every person in this Province who owes money - every person

knows that if they go to the bank to borrow some more money, the bank takes into

account what they owe before they will lend it. It affects the credit rating.

Every additional dollar they borrow affects the credit rating of the person.

Government and government agencies, Mr. Speaker, are no different.

Now, Mr. Speaker, perhaps the greatest false impression that

has been created by some of the irresponsible comments coming from the Leader of

the Opposition and others is that government reaps great profits from owning

Hydro, and this is going to be a significant loss. The simple truth is, Mr.

Speaker, until 1989 government got not a cent of profit from Hydro. Hydro did

not pay. Hydro did not pay a single cent of profit to government.

MR. SIMMS: Government owns Hydro (inaudible).

PREMIER WELLS: It still hasn't paid any profit, Hydro,

since 1989.

MR. SIMMS: (Inaudible).

MR. SPEAKER: Order, please!

PREMIER WELLS: In 1989 the government instituted a

principle that we would charge every commercial type agency - not

municipalities, not health authorities or anybody else like that, but every

commercial type agency - 1 per cent on any money we guaranteed for them. Hydro

was a commercial type agency. We charged them the 1 per cent, too. Since 1989

Hydro has paid the government about $10 million per year as the guarantee fee.

That is all government has gotten from Hydro. Government has not gotten any

profit.

Now in the meantime, Mr. Speaker, opinions that have been

expressed have suggested that government could get anywhere from $250 million to

$350 million from the sale of Hydro. Nobody knows yet what it is going to be,

but if you assume that it is somewhere in the vicinity of $300 million, or even

$250 million - the number used by the hon. the Leader of the Opposition - even

if you assume that, anywhere in that vicinity, the government -

Mr. Speaker, there are certain words that are acceptable in

this House, and others that are not, and the Member for Grand Bank had better

play by the rules or leave the House - one or the other.

SOME HON. MEMBERS: (Inaudible).

MR. SPEAKER: Order, please!

SOME HON. MEMBERS: (Inaudible).

MR. SPEAKER: Order, please!

The hon. the Premier.

PREMIER WELLS: Mr. Speaker, if the government receives

$250 million, or $300 million, or $350 million as a result of the sale of Hydro,

and that enables us to go forward next year without borrowing another dollar, it

will avoid that much borrowing; and if we avoid $300 million worth of borrowing,

as a result of the sale of Hydro, that will save us anywhere from $22 million to

$25 million every year hereafter. We will save that much for the taxpayers of

this Province.

AN HON. MEMBER: At what cost?

PREMIER WELLS: And the cost will be the $10 million

guarantee fee. That is all that government has gotten out of it - $10 million

guarantee fee.

Now in the meantime, Mr. Speaker -

SOME HON. MEMBERS: Oh, oh!

MR. SPEAKER: Order, please!

PREMIER WELLS: Now, Mr. Speaker, in the meantime

government will cause the efficiency of the delivery of electrical power in the

Province to be greatly improved by eliminating duplication and once we get by

the first five years or so, electricity rates will not increase as much

thereafter as they would otherwise increase with duplication.

SOME HON. MEMBERS: Oh, oh!

PREMIER WELLS: Mr. Speaker, you have heard the laughter -

now you know why this Province was in such a mess when they were responsible for

government. They don't even know what efficiency means, they made that obvious

by the mess they created.

AN HON. MEMBER: Hear, hear!

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

MR. SIMMS: I don't know how much leeway you are going to

give me, Mr. Speaker, but he responded to my question with ten or twelve

different comments that had nothing to do with the second question that I asked

him. The first question, by the way - if he is going to quote the paper, he

quoted from the wrong section. His great advisor, the Minister of Finance,

didn't show him the right paragraph. It is the following paragraph, a little

further down the page: `Stephen Dafoe, an associate director at Standard and

Poors, says it's difficult to gauge the effect Hydro's privatization would have

on the rating. It would depend in part on the conditions of sale and the selling

price,' he said. `But as of this time we don't foresee ourselves changing the

rating as a result of the divestiture.' I quoted him accurately and the Premier

tried to fool it up.

SOME HON. MEMBERS: Hear, hear!

MR. SIMMS: So I hope he will apologize. I hope he will

apologize for playing little games.

Now, Mr. Speaker, with respect to another point that he made

- he flicked out this issue of the great debate about whether or not Hydro is

profitable. Nobody asked him a question about that at this point in time but it

is coming. He flicks it out because again he wants to use trickery, he wants to

play word games to try to get people confused about the issue. The issue of

whether Hydro is profitable and whether the government receives money from Hydro

are two different issues. The fact of the matter and the honest truth is that

Hydro has had a profit every year for the last fifteen years - that's the truth.

SOME HON. MEMBERS: Hear, hear!

MR. SIMMS: Whether they have given money to government is

another issue, a totally separate issue, but do you see how tricky he is? He

likes to try to tie it together.

Now, Mr. Speaker, I know I am getting off track a little, but

let me ask the Premier the question - I want to stay on the line that I have

been trying to get on, which has to do with the real cost. I asked him if, in

fact, the real cost of this saving of $10 billion or $20 billion will be covered

off by the loss of jobs, because there are obviously going to be losses of jobs

and there will be losses of tax revenue to the Province, to municipalities and

so on and so forth. By the way, the elimination of jobs was a big issue with the

Premier when he initially announced this decision back on October 1. He

indicated avoiding duplication and efficiency - which, in fact, are two

different things, too - it was a big issue and, in fact, it was going to cost a

loss of jobs. Now, in our debate last Thursday, he downplayed the loss of jobs,

`No, no, there are just going to be a few jobs perhaps in management.'

The Premier's recent revision of his statement, with respect

to that issue, has now been contradicted again publicly by the Vice-President of

Fortis, Mr. Stanley Marshall. I don't know if you have seen those comments or

not, but here is what he said, and I would like to quote it for him: `The real

logic behind the merger is in the savings that will result from eliminating

duplicate services and manpower.' Now, if that is the real reason, I want to ask

the Premier, when is he going to stop trying to fool the people into thinking

that there will not be major job losses and admit, as Mr. Marshall has clearly

admitted here now that, in fact, there will be major job losses as a result of

this merger? Why doesn't he admit that?

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The hon. the Premier.

PREMIER WELLS: I am going to read the complete quote from

the rest of that

article first, Mr. Speaker: `Stephen Dafoe, an associate

director at Standard and Poors, says, it's difficult to gauge the effect Hydro's

privatization would have on the rating.' But it will have an effect, Mr.

Speaker, and we will see in due course.

Now, Mr. Speaker, when the advisers told us that avoiding

duplication, making the delivery of hydro in the Province more efficient would

be beneficial for the future electrical rates in the Province, one of the

questions we asked them was, How many jobs will it affect? They said to us,

`Honestly, we don't know.' `We' - that is, Hydro people - `can only tell you

from our point of view at this time. That is a fact that would have to be

determined if, as and when a merger takes place.' That can only really be

determined with any certainty if, as and when a merger takes place.

The Leader of the Opposition and others have said it is going

to cost hundreds and hundreds and hundreds of jobs.

MR. SIMMS: And it will.

PREMIER WELLS: Okay, now he has just affirmed it, it is

going to cost hundreds and hundreds and hundreds of jobs and his statement now:

"And it will," so we know that is his position. It is going to cost hundreds and

hundreds and hundreds of jobs, okay. Well, this is what he is putting forward.

MR. SIMMS: More than three.

PREMIER WELLS: More than three what?

AN HON. MEMBER: Hundred.

PREMIER WELLS: More than three hundred. Is that the

proposition, hundreds and hundreds and hundreds?

MR. SIMMS: Two hundred to four hundred are direct jobs.

Two hundred to four hundred are (inaudible) jobs.

PREMIER WELLS: Now, Mr. Speaker, I have recently asked

the people: Give me your best judgement as to what it could be. The best

judgement, Mr. Speaker, is, they can't imagine circumstances that could result

in more than 150 job losses, if that many. They can't imagine circumstances that

would result in more than 150. Now, they still don't know how many the job

losses will be, Mr. Speaker, but they can't imagine it would be more than 150,

if it would be that many.

Now, I still don't know, and I have to tell the House, Mr.

Speaker, that is an estimate based on the best judgement that can be brought to

bear on the issue. So, this bogeyman that the Opposition is putting about, of

hundreds and hundreds and hundreds of jobs, just reconfirmed by the Opposition,

is utterly false.

MR. SIMMS: Mr. Speaker. Now, Mr. Speaker, is -

MR. SPEAKER: Order, please!

The hon. the Leader of the Opposition.

MR. SIMMS: Thank you, Mr. Speaker.

Isn't it rather interesting now as we see the days go by. On

Thursday night, in the debate, it was only a few jobs, maybe a few management

jobs, and in a matter of three days at least, we have them up now to 150, and he

didn't say very much beyond that since that time. But now, Mr. Speaker, I

remember, you know, when the Nova Scotia power thing was carried out - which he

likes to use as a great example. There was an announcement by the government

there that there wouldn't be any job losses, and about a month ago, we

understand, there has been an elimination of 400 jobs, about six or seven months

later when that occurred, so it would be interesting to see what happens.

Now, Mr. Speaker, I would like to ask him, by the way - he

said he asked the people for some advice as to the number of job losses; I

wonder, would he table that information for us? Whom did he ask? Or was it the

same group which gave the verbal report? That is what I would like to know and

maybe he can answer that for us when he answers this question.

MR. BAKER: How many questions is that now you have?

MR. SIMMS: I have asked one question. I say to the

Minister of Finance, don't get excited by it. Don't get touchy and excited now,

I say to the Minister of Finance, just because we are getting to you. Just

because we are getting to you, don't let it show; you are supposed to keep your

cool. I asked him one question specifically thus far: Will he table this

analysis on the job losses that he just referred to - will he table that, give

that information to the people of the Province? I will ask only one question for

now, Mr. Speaker; obviously, the Minister of Finance thinks I should not be

asking any more than one at a time.

MR. SPEAKER: The hon. the Premier.

PREMIER WELLS: Mr. Speaker, I asked the individual whom I

thought would be in the best position to bring that knowledge to me and that

individual, is David Mercer, the head of Hydro. And he estimates that the number

would be at most 150, if that many. Now, that is an estimate. Now, I caution

people that that is an estimate. It may not reach 100, for all I know, it may be

160, it may be 170, but I rely on the advice I got from the Hydro people.

SOME HON. MEMBERS: Oh, oh!

MR. SPEAKER: Order, please!

PREMIER WELLS: I accept that advice and I value his

judgement greatly.

MR. SIMMS: A final supplementary, Mr. Speaker.

MR. SPEAKER: A final supplementary, the hon. the Leader

of the Opposition.

MR. SIMMS: A final supplementary, just on the issue of

job loss. I am not quite sure, I might have missed what he said, but did

somebody say he moved up to 170?

AN HON. MEMBER: He said it might be 170.

MR. SIMMS: So it might be 170. Now, Mr. Speaker, the

number I have used publicly is between 200 and 400, so he is getting pretty

close to the number I am talking about now.

AN HON. MEMBER: Hundreds and hundreds (inaudible).

MR. SIMMS: Well, Mr. Speaker, 200 is hundreds. Perhaps

the Premier doesn't understand that. Now, I want to ask the Premier this: What

is his estimate of the spin-off job losses, because any time a government

announces a new project and there are going to be a couple of hundred jobs

created they always use the spin-off factor. Sometimes it is two to one but we

are using a conservative figure because the same thing applies. If you lose a

significant number of jobs there is a spin-off in that. We are using one to one

and that is why we are saying 200 to 400 in spin-off, so you are looking at 400

to 800 jobs. Will the Premier tell the House, does he not expect in addition to

the 150 or 170, or whatever it is, direct job losses, does he not expect there

to be any spin-off job losses? Is that what he is trying to tell us now?

MR. SPEAKER: Order, please!

The hon. the Premier.

PREMIER WELLS: Mr. Speaker, I am getting closer now to an

explanation as to why they left this Province in such a God-awful mess,

financially. They have made it very clear. Carrying his logic to the extreme all

we have to do is just keep hiring people. It will solve all our problems. Just

keep hiring people. Where is the money going to come from? Does he have no

respect or regard for efficiency and running an efficient and effective

government, running an efficient and effective Province? Does he not know how

economically valuable it is to run businesses in the Province and to run

government and government agencies on an efficient basis so that we can generate

even more economic activity and get all sorts of spin-off jobs? No, Mr. Speaker,

his logic is totally and completely wrong.

One of the first things they told us - and I think I made

this clear in a speech I made to the Board of Trade, one of the first things

they told us is that they would expect that the job losses incurred would be

handled in an orderly way, by early retirement, by normal provision for special

severance and so on, by the normal accommodation along those lines. No, Mr.

Speaker, we know their approach. They have a record of seventeen years of making

an economic mess of this Province. We intend to make this Province, government

and all its agencies, and businesses, an effective, efficient, economic unit,

Mr. Speaker.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: Order, please!

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

MR. HARRIS: My question is for the Minister of

Environment and Lands. I would like to ask the minister how many hundreds of

millions of soft drink containers per year will now end up in the environment

because of her government's unwillingness to institute a deposit system in this

Province, or to require the use of refillable soft drink containers?

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

Lands.

MS. COWAN: Thank you, Mr. Speaker.

First of all I am very grateful for this question because I

have been most anxious to get on my feet and discuss it. The beverage container

deposit refund system is not going to go ahead at this present time because we

have a much broader, more far-reaching program that will deal with litter of all

kinds.

SOME HON. MEMBERS: Hear, hear!

MS. COWAN: If we put a deposit refund on just drink

containers what do we do, for example, about fast food containers which are the

worst source of littering in the Province? Indeed there are many beverage

containers, as the hon. member indicated, but they do not make up the entire

waste stream. I myself am extremely excited that we have been able to find a way

to deal with all of the litter that has accumulated along our highways.

MR. SPEAKER: The hon. the Member for St. John's East.

MR. HARRIS: A supplementary, Mr. Speaker.

I guess I should call her the Minister for Excuses who is now

becoming known as Stand Pat Cowan in this Province when it comes to dealing with

the problems of the environment. The excuse this time is that there may be other

garbage around. Why does the minister and her department continue to respond

only to the needs of the soft drink industry and not to the needs of our people?

Why does she not help to create a true system of recycling based on the deposit

system as other provinces such as Alberta have done, create jobs and save the

environment at the same time? Why does she not do that?

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

Lands.

MS. COWAN: Mr. Speaker, I am just thrilled with these

questions. First of all the provinces who have put in a deposit fund system are

sorry now that they have because they see provinces like Nova Scotia,

Newfoundland, and Manitoba incorporating this wider program. Why should

government, Mr. Speaker, become responsible for putting in place regulations

that really concern issues that are not of government's making? For example,

government has not encouraged people to put litter in the ditches. The litter

has been put into the ditches by people who have purchased the packaging from

companies and the new model we are following is to make companies responsible

for their own litter. It is the way we will be pursuing the tire business. As

you know there are tires piled all over the place and are continuing to be piled

all over the place. We have approached the tire industry and have asked them to

become stewards for their own products and they are delighted, just as the soft

drink people are, and the Grocers' Association, to become responsible for their

own waste.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The hon. the Member for Placentia.

SOME HON. MEMBERS: Hear, hear!

MR. CAREEN: Thank you, Mr. Speaker.

Mr. Premier, while the civilian employment at the Argentia

naval facility is one of the bright spots in the Newfoundland economy at the

present time, but with the Americans putting the phase out of Argentia forward

to October 1, 1994, from its original scheduled time of June, 1995, and with the

area presently crippling under some 45 per cent unemployment, and projections

have been done to say that without the American base, unemployment figures in

our region will jump to some 73 per cent, we want to know how much longer we

will have to wait for your government to decide what to do about the situation.

MR. SPEAKER: The hon. the Premier.

PREMIER WELLS: Mr. Speaker, the government will do for

Argentia what it has done for every other community in the Province where

business or industry is closing down - everything that it possibly can - but

notwithstanding the member's question, I have to tell him that the people of

Argentia are no more special than the people of Long Harbour, and no more

special than the people of Labrador City. We have to do everything we possibly

can to try and restore economic activity, but we cannot fabricate jobs out of

thin air.

We spent a lot of effort with the former conservative

government in Ottawa, particularly with Mr. Crosbie, and did not make any real

progress, to try and persuade them to adopt the principle of putting in place a

foreign trade zone, because we thought Argentia, when the Americans pulled out,

would be very suited to that. We also reminded them that the Canadian government

was adding to the problem. They were closing out the Canadian Armed Forces unit

there and moving them to Halifax. I have forgotten how many are there - fifty,

sixty or seventy. If the opposition were describing it, it would be hundreds and

hundreds and hundreds, I have no doubt, but I think it is about fifty or sixty,

something in that -

AN HON. MEMBER: (Inaudible).

PREMIER WELLS: Eighty, is it? Eighty, the hon. member

says, so I accept that.

So they are contributing to the problem as well.

Now I have already spoken to the Prime Minister, to Mr.

Mass, and to Brian Tobin. I have written Mr. Ouellet and Mr. MacLaren on the

issue, and asked them to now give consideration to that proposal to see if this

is an effective means to help us deal with the economic consequences of the

closure of the base at Argentia. I do not know what the answer will be. Up until

the time that they were turfed out of office, the Tories just would not have

anything to do with it.

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

Placentia.

MR. CAREEN: A final supplementary, Mr. Speaker.

Mr. Premier, while the Reuse Study of Argentia, that was

funded by ACOA, is now complete, and the study recommends that $38.4 million be

spent in Argentia over a ten year period, and your government has had the Reuse

Study now for nearly two months, when can we hope to know that the Province will

make a commitment to participate in the Reuse plan?

MR. SPEAKER: The hon. the Premier.

PREMIER WELLS: You don't solve economic problems simply

by spending money. That study is being assessed now.

One of the things that I recall was there was going to be an

American museum, or a museum of American participation in military activities in

Newfoundland. That is hardly likely to generate the hundreds and hundreds and

hundreds of jobs that we are going to need in Argentia to offset the effect, so

spending $34 million simply on the recommendations contained in the Reuse Study

will not necessarily solve all the problems. There may be some things of value.

The study is being assessed right now, and there may well be some things of

value in it, and when that assessment is complete I will be in a better position

to address the House on the issue.

MR. SPEAKER: The time for Oral Questions has elapsed.

Notices of Motion

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

MR. ROBERTS: Mr. Speaker, may I give notice of three

bills, please.

I give notice I will on tomorrow ask leave to introduce the

following bills entitled:

A bill, "An Act To Amend The Royal Newfoundland Constabulary

Act, 1992";

A bill, "An Act To Amend The Electoral Boundaries Act"; and

A bill, "An Act To Amend The Elections Act, 1991".

MR. VERGE: What about the Police Complaints Commission?

MR. ROBERTS: I say to my hon. friend that the first

notice I gave will expand, if the House so approves, the Police Complaints

Commission by three members.

MR. SPEAKER: The hon. the Member for St. John's North.

MR. L. MATTHEWS: I give notice that I will on tomorrow

ask leave to introduce the following resolution.

WHEREAS the Strategic Economic Plan for the Province of

Newfoundland and Labrador firmly establishes the private sector as being the

primary engine of economic growth within the Province;

AND

WHEREAS 66 per cent of all new jobs are all generated in

the area of small family business;

AND

WHEREAS small family business accounts for 55 per cent of

the gross national product;

AND

WHEREAS various studies and reports have pointed to

small-and medium-sized businesses as one of the potential growth areas of the

economy of this Province;

THEREFORE

BE IT RESOLVED that this House of Assembly

re-affirms its recognition of small business as a major part of the private

sector economy of this Province and re-affirms its commitment to:

1. Support of organizations that promote the interest of

small business;

2. Development of programs to assist small business in this

Province;

3. Promote the fostering of an economic environment wherein

small business development is encouraged;

4. Continuing to streamline the regulatory structures and

processes of government so as to simplify and enhance the possibility of success

of small business enterprises; and,

5. To encourage the development of entrepreneurship in the

Province at the small business level generally.

Thank you, Mr. Speaker.

Petitions

MR. SPEAKER: The hon. the Member for Eagle River.

MR. DUMARESQUE: Thank you, Mr. Speaker. I'm very pleased

today to rise in support of a petition signed by 194 residents of Mary's Harbour

and Lodge Bay. The prayer of the petition is as follows:

Whereas the only form of transportation from the community of

Lodge Bay is via the Lodge Bay Road, and where there has been nothing done with

this road since it was constructed, and

whereas the condition of the road is

deplorable and unsafe to travel, wherefore the undersigned, your petitioners,

humbly pray and call upon the House of Assembly and the Minister of Works,

Services and Transportation to see our concern and provide funds to crush stone

and upgrade this road.

Mr. Speaker, I'm very pleased to stand and support the prayer

of the petition, because the people of this community depend upon this road

totally to go back and forth to work at the Mary's Harbour crab plant. Obviously

it is very vital to them to be able to transport their goods and services to the

community because they don't have an airstrip, unlike some of the other

communities along the coast. Since this road was built we haven't seen the

maintenance money or any kind of a directed maintenance budget for it from the

department. I might point out that the road was built under a federal-provincial

agreement, which was also unusual. I guess maybe that is one of the reasons why

there wasn't a fixed maintenance budget associated with it.

At this point in time, that road is in very bad shape. Just

this year, this summer, when I had the Minister of Works, Services and

Transportation down with me, we saw that there was a washout in a portion of

this road, and certainly that has made it that much more impassable. I would ask

the minister to give this his every consideration, as I know he will, because it

is absolutely vital to the people of these two communities to see that this road

is upgraded, and hopefully upgraded to the maximum level possible, and be able

to be there for some time to come, until we get the Trans-Labrador Highway so we

can then connect to the Labrador Straits and in towards the other communities

along the coast into Goose Bay. That is another project that these people want

to see get the attention it deserves by this government and also, obviously, by

the federal government.

I would ask the government to give it the concern that it

obviously has for the people of this particular area of the Province. Because,

regardless of where you live in the Province, Mr. Speaker, you must be getting a

fair return from the tax dollars you are paying. At this point in time, these

people in these two communities haven't seen the return to be able to deal with

this type of problem that they would expect and they deserve. I thank hon.

members for listening to this and I ask the minister to do what he can.

Thank you, Mr. Speaker.

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

MR. WOODFORD: This is another petition, Mr. Speaker; I

don't know if anybody else wanted to speak to the hon. - oh, I am sorry.

MR. SPEAKER: Before receiving the next petition I will

hear from the hon. the Minister of Works, Services and Transportation.

MR. EFFORD: Thank you, Mr. Speaker. I hesitated to get up

because I figured that one of the people on the Opposition side would have at

least spoken -

AN HON. MEMBER: (Inaudible).

MR. SPEAKER: Order, please!

MR. EFFORD: I will sit down and give you the opportunity.

SOME HON. MEMBERS: Oh, oh!

MR. EFFORD: Mr. Speaker, I listened with great interest

to the hon. the Member for Eagle River in presenting his petition on behalf of

the people of Labrador, in the area of Lodge Bay. I have been quite clear about

my feelings on the need for an improved road system across Labrador since the

first day I was invited into Cabinet and being Minister of Works, Services and

Transportation. I have been listening to the comments from people across the

Province, and I refer to some of the comments made by the former member

representing the people of Labrador, Mr. Fenwick, and his critical way of

opposing the people with the question, Why would the people of Labrador need a

road system? With 30,000 people in Labrador, why would we need to spend a large

amount of money on ensuring that these people would have a reasonable

transportation network such as we experience here on the Island? I wondered why

he would make such a statement. Just because you live in a small area of this

Province of Newfoundland and Labrador, doesn't mean that you shouldn't at least

enjoy some form of transportation equal to that of the rest of the Island. We

are committed, Mr. Speaker, to improving the road conditions into Labrador,

especially when it comes to the Trans-Labrador Highway. We are certainly

committed to working with the federal government in the future and to making

sure that we can at least make some start in negotiations for providing funding.

The Lodge Bay Road - the member is quite right, they had some

difficulty this past year with a wash-out down there and the road condition is

very, very deplorable. I had the opportunity, with the member, to visit not only

Lodge Bay but other areas. And we are committed to providing funds, and funding

may be available to us next year, ensuring that the people of Lodge Bay will

get, along with every other part of the Island, a fair, equal chance of getting

a reasonable road in their area. No less should they expect that than I would in

my own community.

I am very aware of the situation and I am hopeful that from

the funding being provided, we will do what is necessary for the people of that

area in the 1994 season.

MR. SPEAKER: The hon. the Member for Placentia.

SOME HON. MEMBERS: Hear, hear!

MR. CAREEN: Mr. Speaker, I support the Member for Eagle

River in his endeavour to improve the road conditions in Lodge Bay, an area that

I am fairly familiar with myself from spending time on the Labrador.

AN HON. MEMBER: (Inaudible).

MR. CAREEN: I will tell you afterwards - I am not going

to tell you anything in public.

I was wondering just how long the Member for Eagle River has

been sitting on the petition because the - but while $26 million has been cut

from capital spending this year, I mean, we could have saved to balance the

books, we could have done the Lodge Bay work earlier. It is very interesting

that the minister got up to help his colleague for Eagle River. The yellow lines

in the District of Placentia, Southeast, Point Verde, Ship Harbour and Fox

Harbour have not been put down yet and there have been a couple of excuses

given. We are looking to have a yellow line put on some pavement that was done

out there this summer.

There is this, also, that they saved $400,000 to buy the

property from the Fort Motel, which has not been properly answered yet, and

there is a petition, of which I only have a copy, and I couldn't put to this

House the good people of McCallum in September, put a petition to the hon.

minister for them to get -

AN HON. MEMBER: (Inaudible).

MR. CAREEN: It is up to you, Sir. The people of McCallum

and Hermitage - I am supporting the people of McCallum to get a ferry service to

tie in with Gaultois and Hermitage, and I would like to see the hon. minister

address that. In cluing up, I do support the Member for Eagle River and I am

glad that the Minister of Works, Services and Transportation is going to help

him.

Thank you.

SOME HON. MEMBERS: Oh, oh!

MR. SPEAKER: Order, please!

The hon. the Member for Humber Valley.

MR. WOODFORD: Thank you, Mr. Speaker.

I have a petition here that addresses the House of Assembly.

It is from 231 constituents of the community of Howley. People in the community,

after hearing some of the recommendations made by the Electoral Boundaries

Commission, were rather concerned and decided to initiate a petition in the

community to have their concerns made known to government. However, I understand

from the workings of the commission that they are probably not going to report

before next spring - probably some time late in the winter or early next spring,

and there is lots of time for petitions and so on; but this petition is in, and

I don't intend to let is sit on my desk all winter, I want to make sure it is

presented in the House.

The petition, from the people of Howley, says: `To the

Government of Newfoundland and Labrador, they have proposed changes to the

current Electoral Boundaries Commission to reduce the number of districts from

fifty-two to forty.' That has been done by the Electoral Boundaries Commission,

although it says Government of Newfoundland and Labrador, which is not yet true.

`While we do see changes necessary to reduce government spending, we strongly

oppose putting Howley in the new district, the District of Baie Verte - White

Bay. We feel Howley should be included with the new District of Humber - Bonne

Bay, as most of our business is conducted there and all of our plans for

economic growth have been and will be carried out in conjunction with the Humber

Valley and Bay of Islands area. As Howley has no political, social or economic

ties to Baie Verte, it would be detrimental to the town to be included in the

District of Baie Verte - White Bay.'

Mr. Speaker, as I said, the petition is signed by 231 people,

residents of Howley; there is also a covering letter from the council, signed by

the Mayor of Howley, Calvin Samms, outlining some of the reasons why the people

of Howley don't want to be put in with the District of Baie Verte - White Bay.

They want to remain with the new District of Humber - Bonne Bay whether it comes

to that or not; if there is not a new District of Humber - Bonne Bay, they would

like to remain with the District of Humber Valley.

Some of the reasons they outline, as I stated before, are

that Howley has no political, social or economic ties to Baie Verte, and

therefore, it would be detrimental to the town to be included in the Baie Verte

district. `Howley has nothing in common with the Baie Verte - White Bay district

and we rarely travel there; we depend on Deer Lake, a half-an-hour's drive from

Howley, for all our services. Schools, medical clinic, dental, shopping, garage

and so on, all of the above services cannot be offered in the proposed Baie

Verte district without long travel' - and that is a very key issue, long travel,

because Howley is only separated by about half-an-hour's drive from Deer Lake,

and yet, you have to pass White Bay South before you can even get into the

District of Baie Verte - White Bay.

So I go along with the residents of Howley, Mr. Speaker, in

their concerns and in outlining their concerns. Always, when it was recommended

here that we should have some changes to the districts in the Province, I was

one of the first who said: yes, it should be looked at. But I stand here as an

MHA, making no apologies whatsoever, based on the salary I am getting now or the

work I am doing in the District of Humber Valley as it is today, no apologies to

anyone in the House or to any resident of the Province of Newfoundland and

Labrador. I work for everything I get out there and everybody knew what the

salary was before I ever got into it. Everybody had an opportunity to run and I

work as an MHA every day of the week, all hours of the day, every day of the

year, and I make no apologies to anybody.

Having said that, Mr. Speaker, I say that I would be able to

take on extra duties in a district, extra people, including the people of

Howley, but under one condition, and that is, that I would have to have extra

staff. I would not be able to handle it and do the same job I am doing today,

with an increase of 4,000 or 5,000 people in the district. I can't do it. It is

one thing to have representation and another thing to have effective

representation, and if we are going to have it as MHAs - we are always

apologizing. Why can't we stand up and be counted? If we are doing our jobs in

our districts, what do we have to be ashamed of? Not a thing.

MR. SPEAKER: Order, please!

MR. WOODFORD: Mr. Speaker, if I could have another few

seconds to clue up? I go along with the people of Howley in their concern for

leaving the community of Howley in the district and also - and I am sure there

will be lots of other opportunities to do so later on - I want to make it quite

clear that if there are any changes made to the District of Humber - Bonne Bay -

AN HON. MEMBER: (Inaudible).

MR. WOODFORD: Yes, and I will probably take in some of

the people in the new district of the Member for St. Barbe, good people all down

through Trout River, Bonne Bay, Woody Point, Norris Point, and as far west as

Corner Brook. But I am sure, and I speak for all members of the House, that if

that happens, if they are talking about saving money with regard to the salary

of an MHA, they have to look at putting money into extra secretaries, executive

assistants, or something. Let's not be hypocritical about it, if there are going

to be changes it's not going to be the great amount they are talking about.

There has to be something put in place so that MHAs with the new and expanded

districts will be able to represent their people and represent them properly in

the House of Assembly and elsewhere.

Thank you, Mr. Speaker.

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

MR. SIMMS: Thank you, Mr. Speaker.

I just want to say a few words in support of the petition

from the people from my birthplace, Howley, so ably presented by my colleague,

the Member for Humber Valley.

AN HON. MEMBER: A lot of good things came out of Howley.

MR. SIMMS: A lot of good things have come out of Howley,

a lot of good things.

Mr. Speaker, I know the area quite well, of course, and I am

familiar with the issue that they raise in their petition. I didn't catch the

numbers.

MR. WOODFORD: Two hundred and thirty-one.

MR. SIMMS: That must be pretty well everyone in Howley,

is it, or close to it? They can't for the life of them understand why they would

be placed in the new Baie Verte - White Bay constituency, and I must be honest

and say I can't for the life of me understand why either. Geographically, it

certainly doesn't make much sense at all.

The Member for Baie Verte - White Bay is not here today but I

happen to know that I think he has similar feelings as the people from Howley.

As a matter of fact, and it is no reflection on the people from Howley, he would

be proud to represent them if that is what ends up happening after we debate the

boundaries distribution recommendations in the House. He would we proud to

represent them if that is the way it turns out, but he agrees with the people

from Howley and, I guess, the Member for Humber Valley now, when they say and

when he says, it doesn't make a lot of sense. I think the commission has now, if

it wants, the authority to make that kind of a change, and I am sure they will

look favourably, at least I hope they will look favourably, on this argument.

Now, as for the broader issue that my colleague touched on,

overall representation by MHAs, I think there is a great deal of merit in the

argument that he puts forth, and some other members have put forth from what I

have read, about the need to provide some extra assistance to MHAs who are going

to have these larger areas to cover and the larger number of constituents. I

believe there is some merit to that. I can't agree with my former colleague and

friend, Mr. Kevin Parsons, who was quoted in the paper a few days ago as saying,

rural members will be able to deal with the increased numbers of constituents

quite easily. I don't agree with Kevin on that particular point.

I do agree with him and with the government - because after

all, let's not forget, this is a government initiative. The government, the

members of the Cabinet over there, had put forth the argument that the number of

seats should be reduced. In fact, they have told the Commission: you must reduce

them, at least to between forty and forty-six, according to the law. The

Minister of Justice has publicly now adjusted that to say between forty-four and

forty-six, I believe it is.

I suspect that is because there is considerable hassle from a

lot of members on the other side whose seats are in some jeopardy. I suspect

that is where it is coming from, including the Minister of Works, Services and

Transportation, although I have no doubt in my mind that he will be in this

House for as long as he ever wants to be, no matter where, no matter what

constituency he represents. How is that?

Mr. Speaker, I think this whole issue has a long way to go

yet. I suspect when that boundaries distribution Commission's report goes to the

inner circle, goes to the fifteen over there on that side who will make the

decision, the Cabinet, I have a funny feeling they will look very hard at trying

to protect as much turf as they can, realizing they've boxed themselves into a

real corner now by ordering the Commission to at least reduce it by six. That is

the very least. But being shocked when the Commission came back and said: we

will reduce it by twelve, I think they were taken off-guard.

You could see them over the scampering. The Member for

Windsor - Buchans, who doesn't like to see the new Grand Falls - Windsor

district, he would like to see Windsor - Buchans. You see the Member for

Lewisporte, who says the people from Lewisporte want nothing to do with the

Minister of Finance, and I can't blame them for that. That is a reasonable

position for the people of Lewisporte to take. You see them over there all over

the place, scrambling. The Member for Harbour Grace, one day: it is a good idea

to reduce the number of seats. The next day you see him appearing at the

Commission and he is saying: oh no, you can't do it here.

The Member for Port de Grave, who is a minister, who brought

in the legislation, had to be careful what he said in front of the Commission

because he ordered the Commission to do it. So he sent his executive assistant

to appear on his behalf, to mouth what his position was. And he says: `Oh, we

can't make these changes.' It is happening all over the place. The Member for

Terra Nova, I predict, I don't know if she has said anything publicly but I

suspect if she does -

MR. SPEAKER: The hon. member's time has elapsed.

MR. SIMMS: Anyway, maybe on another day we will have some

more petitions to present, Mr. Speaker. Thank you very much.

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

MR. ROBERTS: Mr. Speaker, if I could make a couple of

brief comments in response to the petition which my friend for Humber Valley

presented.

First, let me say that my friend advised me in a

conversation, as it were, behind the Chair, that he has presented a brief to the

Electoral Districts Boundaries Commission similar to the prayer of this

petition. The message in the petition has been presented to the Electoral

Districts Boundaries Commission. My friend has done the right and proper thing,

in my judgement, because of course the carriage of this matter -

SOME HON. MEMBERS: Oh, oh!

MR. ROBERTS: Mr. Speaker, if I'm not interrupting the

conversations on the other side, I will continue.

AN HON. MEMBER: (Inaudible) listening (inaudible).

MR. ROBERTS: No, I agree. The hon. gentleman, if he can't

be civil, should try not to be rude. Now, Mr. Speaker, if I may. I didn't

interrupt him. I had asked him not to interrupt me, Mr. Speaker.

Now, as I was saying, my friend for Humber Valley has, in my

view, done the right thing, because the carriage of this matter is currently

with the Electoral Districts Boundaries Commission, which in due course will

make a report to this House. That's the first thing that he should have done and

I'm glad he has done it.

Secondly, I would remind members again that the Commission

does not set boundaries. Only this House, under our current procedure which we

propose not to change, may set boundaries. So in due course, after the report of

the Electoral Districts Boundaries Commission is received, it will be incumbent

upon government to bring a bill into the House and to make in that bill

provision for boundaries, and then members will debate and decide.

Thirdly, let me say that there are many on this side who have

expressed views similar to those of my hon. friend for Humber Valley, that in

the event the number of seats is reduced, as is this government's policy, there

is a great deal to be said for increased staff to enable members properly to

discharge their jobs. There are two things to remember. One is, a member

functions as sort of a liaison or a link between people on one hand and the

government, in the broadest sense, on the other - the bureaucracy, the political

structure of government, the whole kit-and-caboodle together. But, also, we sit

here in the House representing the people who send us here. That is what, of

course, gives us some difficulty with the great disparities in population.

The seat of Grand Falls, I think, is now the smallest one,

probably, or next, leaving aside Torngat - which is a unique situation, we all

acknowledge. Grand Falls, I believe, is about the smallest seat.

There is no reason why the gentleman for Grand Falls should

speak for one-half as many people, as it were, as does his friend for Waterford

- Kenmount, whose seat is roughly twice as large. Now, that is partially the

result of what was done in the 1970s; it is partially the result of the very

large growth in population in the Waterford - Kenmount district, which I don't

think has been mirrored in the Grand Falls district.

Finally, let me make two other points to my friend, in

respect to points made by my friend, the Opposition Leader. First, we did not

tell the commission what they should or should not do. I made a brief to them on

behalf of the Ministry, as anybody was welcome to do, and as any member may do,

and many have done - some of them on this side; some on the other side - as my

friend from Grand Falls has.

Now, no minister has made a presentation to the commission

except me, and I spoke on behalf of the entire government. We did give them our

thoughts on their proposal. We think that is proper because we believe they have

a right to know what we think and why, and that is what my brief said. What the

commission do with it is up to them and my friend, I suspect, knows most of the

members of the commission about as well as I do, he would agree that it is

unlikely that the Chair or the four other members will take direction from

anybody except their own consciences and their own belief as to what they should

do in this situation.

AN HON. MEMBER: (Inaudible).

MR. ROBERTS: Yes, the suggestions that I have put

forward, in my understanding, were consistent with the legislation as it now

stands.

Finally, Mr. Speaker, let me make the point that there will

be a debate in this session, because we have put down on notice - I gave notice

today - to amend the Electoral Boundaries Act further, so members will be able

to address this matter at whatever length they wish, consistent with the rules.

Thank you.

MR. SPEAKER: Orders of the Day.

The hon. the Government House Leader.

o o o

MR. ROBERTS: Mr. Speaker, before we call Orders of the

Day, would members agree to revert to Notices of Motion? My friend for Fortune -

Hermitage would like to give notice of a Private Members' Motion.

MR. SPEAKER: Do members agree to revert to Notices of

Motion to accommodate the hon. the Member for Fortune - Hermitage? Agreed? Okay.

The hon. the Member for Fortune - Hermitage.

MR. LANGDON: Thank you, Mr. Speaker. The resolution

reads:

WHEREAS it is essential to our future that we transform the

education system of Newfoundland and Labrador from one of persistent

underachievement to one whose achievement levels rank with the best in the

nation; and

WHEREAS it is entirely within our own capacity to make

changes to achieve this goal;

THEREFORE

BE IT RESOLVED that this House approve in

principle, the reform of the elementary and secondary education system of

Newfoundland and Labrador, set out in adjusting the course, restructuring the

school system for educational excellence.

Orders of the Day

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

MR. ROBERTS: Mr. Speaker, I am not sure of the procedure

of correcting Hansard, and I guess normally one should not correct Hansard,

which is a very, very good attempt to make a verbatim record of what is said in

this House, but there is an error in Thursday's edition which is so egregious

that in my view it should be corrected, so I would like, if I may, simply to

note, on page 761, during the report of a speech made by my friend for Port au

the official language in this House." What, in fact, I did say, as the hon.

gentleman acknowledges, as others will, is that "French is an official language

in this House". Then it goes on to say, Mr. Smith, "I recognize that." He did,

in fact, say that.

Mr. Speaker, I looked it up; it was in May, 1968, if memory

and French may be used in our debates, and while very few members - I am sorry?

AN HON. MEMBER: (Inaudible).

MR. ROBERTS: Well, very few members, other than my friend

for Grand Falls, choose to speak in French, or parlez en franais - and I am not

going to attempt to go any further than that - it is certainly proper, and I

wouldn't want the record of the House to stand in Hansard, so I would ask that

the correction be made.

Let me say, as well, I have had a word with the Hansard

reporters who, in fact, first brought this matter to my notice. I have to tell

you, I don't go home and read Hansard in the evening, Mr. Speakers. Others may,

but I don't. The young lady called, apologetically, and I said, "No need to

apologize, we will set it straight." But I would say to hon. members here who

bilingual capacity, nor can we reasonably expect the staff of Hansard to have a

bilingual capacity, either the reporters, the transcribers or the editors. So

any member who chooses to speak in French, in my judgement, would be

well-advised to have a translation available; either that, Mr. Speaker, or take

your chances. The staff will do the very best they can. We are not going to

want to use it, either do it at your peril or be prepared with the text so the

transcribers can get it straight.

Thank you, Sir.

MR. SPEAKER: I think they can handle the `oui, oui' of

the hon.-

MR. ROBERTS: With that said, Mr. Speaker, could we

proceed in order with the bills that I spoke of the other day, Bill's No. 25 and

if or when we finish that Bill No. 26, they stand as Order's No. 7 and 8?

MR. SPEAKER: Yes, I am sorry. Would the hon. the

Government House Leader give me that order again, please?

MR. ROBERTS: Order 7, Mr. Speaker, which is, "An Act To

Amend The Gasoline Tax Act," Bill No. 25. When we finish that, as we will some

day, "An Act To Amend The Health And Post-Secondary Education Tax Act," Bill No.

26. We will then go on to Order's 9, 10 and 11, we will see how we get along

then. Thank you, Sir.

MR. SPEAKER: Thank you.

Motion, second reading of a bill, "An Act To Amend The

Gasoline Tax Act." (Bill No. 25)

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

MR. BAKER: Thank you, Mr. Speaker. I will provide a very

brief explanation of what this Act is all about. In actual fact, it is to

legitimize what has been going on for a period of time. There was agreement

reached between provinces as to the method of dividing gasoline tax for

inter-provincial carriers. Over the years there has been quite a bit of

confusion and confusing policies on this particular issue throughout the

maritime provinces. So there was an agreement that we get together and come up

with a formula whereby we would register inter-provincial carriers and determine

the gasoline tax payable according to an agreed upon formula which is included

in this piece of legislation.

In the interim, Mr. Speaker, while the legislation was being

prepared in the various provinces to allow for this, the industry itself decided

to go along with this new type of regulation voluntarily and by far the vast

majority of inter-provincial carriers are already being dealt with according to

this formula. So, Mr. Speaker, it is a matter of an agreement that brings some

order to the registering and collecting of tax from inter-provincial carriers

that go through this Province.

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

MR. WINDSOR: Thank you, Mr. Speaker. There is really not

a great deal that can be said about this particular piece of legislation as the

minister has noted. It has actually been in place for about three years. It was

an initiative that was started prior to change of government really. I think

this was brought through by the minister or by his predecessor, I think during

their first year of office back in 1989 or 1990. In fact it was brought about on

representation from the trucking industry who were finding unfair competition

from out of Province carriers. They were coming in here and really spending no

money in the Province and were taking advantage of lower gasoline prices or

diesel fuel prices primarily in other provinces of Canada. I guess the only

question that should be raised in relation to this, Mr. Speaker, is, what is the

concept of reducing taxes on gasoline and diesel fuels to make us also more

competitive? We still have it here but at least now others are paying it as

well. So outside of reducing the competition the real advantage I suspect - if

the minister has any data on that I would be interested to know how much we have

gained from carriers of other provinces as a result of this particular piece of

legislation.

I do not know why it has taken so long to get this here, it

is really a relatively routine matter once you decide to put it in place. Now

that was done more than three years ago, why has it taken three years for this

legislation to be drafted and brought before this House today? There is nothing

controversial about it. I think we all agree with it, the industry has agreed

with it and have been using it now for three years. So maybe the minister would

like to tell us why, if he knows, that it took so long? What, if any, other

benefits has the Province received by way of revenues from extra provincial

carriers coming into this Province?

There were other issues as well relating to that, as to what

control or what impact we might have of keeping these people in the Province and

ensuring that a certain portion of their other costs are here as well. Could the

minister tell us what reciprocal agreements are now in place relating to

licensing of extra provincial carriers? Do we now receive a portion of license

fees based on the percentage of their mileage spent here? In other words, the

same sort of reciprocal agreement that is in this legislation as it relates to

gasoline and diesel fuel taxes, is there a similar reciprocal agreement as it

relates to registration fees and so forth which might go toward the cost of

highway upgrading?... because as we now see, the transportation of goods in this

Province, is very, very rapidly changing from - well rail is long gone, but even

now, from the marine route from shipping, more and more is being brought in by

rubber tire simply because of rapid service, delivery of fresh goods

particularly, and less damage and loss through breakage and pilferage and so

forth along the way, so rubber tire mode seems to be the preferred route.

The hundreds of millions of dollars that we put into the

Trans-Canada Highway as a result of Roads for Rails Agreement, I would say and

that is a good opportunity for me to say, has tremendously improved the

Trans-Canada Highway to the point where it is almost a pleasure now to drive

across this Province, there are some areas that still require upgrading, but

certainly our highway is in relatively good shape compared to where it was eight

or ten years ago when we made that agreement, the federal/provincial agreement.

In comparing it, I might say, with other provinces in Atlantic Canada, we stand

in fairly good position and I recently noted an

article from some officials I

believe in Nova Scotia, who wished that they had an opportunity to -

AN HON. MEMBER: New Brunswick.

MR. WINDSOR: It was New Brunswick, I accept that

correction. I think it probably was New Brunswick. They would be very happy to

enter into a Roads for Rails Agreement and they know how much our highway system

has improved as a result of that agreement. I will resist the temptation to go

into the politics of the argument back and forth at the time we did that, and

how much hon. gentleman opposite delight in making announcements of these

millions of dollars that are being spent in Newfoundland today; I will leave

that for another time. But, Mr. Speaker, I think it is important to note that

there is a tremendous pressure on our highways simply from a technical point of

view. You can have all the cars you want driving on that highway, they will

cause no damage. One transport truck, one tractor trailer, one eighteen-wheeler

does as much damage as 5,000 automobiles travelling over the highway and when

you design a highway, you design it for the eighteen-wheelers not for

automobiles from the point of view of the design, the structural strength of the

highway system.

So, Mr. Speaker, as traffic increases as it is increasing,

there are two things we need to look at, ensuring that these tractor trailers

are contributing, through gasoline taxes as they are here, through registration

systems, user fees or whatever sort, so that transport trucks from out of the

Province, are contributing to our highway system in a comparable manner as our

transport fleet drivers/operators would be contributing in other provinces of

Canada and in the United States.

I think that is an important aspect to look at and the other

thing, is simply a word to the Minister of Works, Services and Transportation,

to have a look at the standards we are applying in designing our highways. We

realize that we have in Newfoundland the most destructive weather from the point

of view of highway maintenance and so forth. We have about twenty-five or thirty

freeze/thaw cycles a year, which causes more damage to highways than any other

single factor, so our highway standards need to be much more severe from the

point of view of structural strength than in any other parts of Canada. I always

envy other areas - I know I was at a technical mission before I was in politics,

visited Windsor, Ontario and looked at concrete roads being built there, and

water and sewer systems being put in and literally, they are building it on

sand.

They put down their concrete roads simply by grading the sand

and you have a perfectly load-bearing substructure then to put your concrete on,

and when they install their water and sewer systems, they simply then push the

copper pipe across through the sand by injecting water through it, and actually

washing their way through, so you put in your water and sewer systems after, and

you do not have to cut roads and pavement as we do in Newfoundland, which gives

you a roller coaster effect on most of our roads, certainly in municipal areas,

so we have a lot of disadvantages there, but again, the big problem and the big

difference is when you are on a structure like sand, you have a very, very

consistent bearing substructure as compared to in Newfoundland, where you have

so many variable conditions from rock to sand to bog to something almost totally

impossible to build roads on. It is not unusual to have to excavate twenty and

thirty feet of bog and replace it with solid material in order to build a

highway in this Province.

Unfortunately, the surface material that is available for

building the subgrades of highways in many parts of our Province, is very

difficult to find, now, suitable material. In fact, we will find over the next

number of years that proper granular materials for highway construction will be

one of the greatest commodities in this Province, and the cost and the value for

those types of materials, Mr. Speaker, will increase tremendously.

With those few questions, perhaps the minister would like to

answer those few points. I may have something else to say.

MR. SPEAKER: The hon. the Member for St. John's East.

MR. HARRIS: Thank you, Mr. Speaker. I rise in support of

the legislation. Clearly, it is terribly important for us to ensure that the

users of our highways - particularly those heavy users that come in the form of

transport trucks and interprovincial carriers, as we are dealing with here,

transport trucks bringing goods across the Province - must pay their fair share

of the cost of maintaining those highways through the gasoline tax.

As the Minister of Works, Services and Transportation, of

course, whose responsibility it is to maintain those highways, looks to the

Minister of Finance for money from time to time in order to be able to meet the

costs that are being placed before him, as a cost of maintaining our highways

and roads. Some of them are maintained well and some of them are not maintained

very well at all. We see from time to time ruts or ridges even in our new

Trans-Canada Highway which are clearly made by the impact of these very heavy

vehicles travelling our roads twenty-four hours a day. Any legislation,

particularly the power to make regulations to control the ability to collect the

taxes needed to do that, is very important.

What occurred to me, though, and I know that the Minister of

Works, Services and Transportation is also interested in this aspect of it,

looking at this legislation it strikes me that government, when it wishes, can

go to all sorts of lengths of detail to be able to have an influence on an

economic activity. I know the Minister of Environment is listening here, because

perhaps she could learn some lessons just by reading the legislation of the

Minister of Finance here. That government when it wishes can go to any lengths

in regulating the operation of an industry. Here we just see, just simply to

ensure, that those who use our highways, who have a headquarters in another

province, pay their fair share of taxes. The Department of Finance officials and

the `legal beagles' or whatever they are called, in the Legislative Counsel, can

put together a set of regulations with power to enforce them, to control them,

by the issuance or non-issuance of renewal of licences, by the requirement of

showing their books and keeping certain appropriate records, can take a very

pro-active approach in ensuring that businesses are conducted in such a way as

to satisfy the public interest in paying tax.

Similarly, the Minister of the Environment's officials, if

she would only ask them, could actually have some impact on the amount of junk

that goes into the environment. I'm not talking about an anti-litter campaign,

one that might ensure, that might convince some people to bring - instead of

throwing it in the environment to bring it to a landfill site and increase our

landfill sites. I'm not talking about that. I'm not talking about an anti-litter

campaign. I'm talking about some measures by regulation, by developing an

incentive system as the Minister of Finance has done. People who pay their taxes

will get a licence. If they don't pay their taxes they won't get their licence,

or they won't get it renewed. There is an incentive for people to comply with

the regulations of government, to look after the needs of our Province and our

public interest.

MR. BAKER: I don't see anything in here about that.

MR. HARRIS: The Minister of Finance says he sees nothing

in the Bill about that. If he reads carefully he will see how the renewal of a

licence, contained in Clause 11 of the Bill, for example, the person who is

dissatisfied by the refusal to renew a licence can apply to the minister for a

review.

The minister can say: Well, yes, we will give you back your

licence if you comply with our regulations, because the paragraph goes on to say

that the minister can consider such an application, can confirm or alter the

decision to refuse, cancel, suspend, or attach conditions to a licence or

registration and notify the applicant accordingly.

So there, Mr. Speaker, the Minister of Finance is given some

control and influence over the behaviour of these interprovincial carriers not

even in the Province's jurisdiction. They live somewhere else. Their

headquarters is somewhere else. They are only bringing their trucks into this

Province, and yet the Minister of Finance has some control and some ability to

have some control over them; but now the Minister of Environment and Lands, no,

Mr. Speaker. She even goes so far as to say, in the House today, that the

government does not care, that the government is not interested in protecting

the environment. It is going to leave it to the industry itself.

Well, Mr. Speaker, if the Minister of Finance left it to the

interprovincial carriers to pay their taxes, to come and pay it, what would

happen? Come and pay your taxes, you Ontario companies, or Quebec companies.

When you come to Newfoundland, stop by at the Minister of Finance's office and

pay your taxes.

If the Minister of Finance said that, he would be very

disappointed at the amount of taxes that he got, just as the Minister of

Environment and Lands, and indeed the people of this Province, will be very

disappointed at the response that we can expect from some sort of anti-litter

campaign.

I say, Andy Wells tried that at City Hall, Mr. Speaker, with

his `litter-busters' campaign, and while it may well be good to convince young

people to care for the environment, and not to litter, nothing is going to work

unless some system of regulation and control and government-sponsored schemes is

going to work.

As I said the other day, Mr. Speaker, after spending a couple

of hours and loading up a pick-up truck with materials for recycling, and

bringing them out to the recycling centre, the return to my wife and I was

$1.40. The point is, it was not done for the money in my case, but if you are

going to rely on people doing it out of the goodness of their hearts, because it

is the right thing to do, such as paying taxes is the right thing to do, then it

is not going to happen. There must be regulations; there must be control; there

must be some teeth.

Even a simple thing which the minister could do is take the

liquor bottles which are sold by the Newfoundland Liquor Corporation, filled up

with alcohol. If the minister would instruct Newfoundland Liquor Corporation to

tack on twenty-five cents per bottle - they do it from time to time anyway by

raising taxes or by some sort of increase that they put in there - for the

liquor sold at Newfoundland Liquor Corporation, and that money was used to

finance a deposit system, because you would get twenty-five cents back when you

brought the bottle back, well that would be a way which the minister, if she

cared, could try and regulate the use and disposal of waste in this Province,

just as the Minister of Finance is regulating the way that gasoline taxes are

paid by interprovincial carriers who do not even reside in this jurisdiction.

So I commend the Minister of Finance in bringing forward this

legislation. As the Member for Mount Pearl said, they have been doing this in

some form or other anyway in the last three years, and now the legislation is

catching up with the practice and giving the minister certain more powers; but

while commending the minister in putting this in place, I also suggest that it

may be an example to other ministers, such as the Minister of Environment and

Lands, who does not seem to know that you can actually affect the people's

behaviour by imposing regulations such as are imposed here.

Thank you, Mr. Speaker.

MR. SPEAKER: The hon. the Member for Green Bay.

MR. HEWLETT: Thank you, Mr. Speaker. I would like a few

words on this.

As we were talking about fuel taxes as regards our highways,

and the truck traffic on our highways, there is an issue that I have raised in

the House over a couple of years, and I raise it again because I am not sure of

the current status of it, and that has to do with the weighing of wood trucks by

volume rather than actual weight itself. Government in previous years have made

tremendous amounts of money not only from taxes but from highway traffic fines

on a number of trucking businesses in my district, and there was a great hue and

cry some time ago to have government implement a system of measuring wood by

volume and I would like to know from the Minister of Works, Services and

Transportation, if he cares to speak in the debate, number one, has it been

fully implemented, and number two, just what have been the results? I have not

had many complaints of late so I am hoping that a new and better system has been

brought in and there have been far less violations. I would be pleased if the

Minister of Works, Services and Transportation would raise that.

Thank you.

MR. SPEAKER: The hon. the Member for St. Mary's - The

Capes.

MR. MANNING: Mr. Speaker, I welcome the opportunity to

speak on the Roads Act, the amendment to The Gasoline Tax Act, and I say that

government should not stop here. Some of the gasoline tax is stifling the

economy of our Province, especially in the case of small business. Many small

businesses, because of the geography of our Province, have to travel great

distances in order to pick up supplies and therefore their transportation costs

have skyrocketed because of the amount of tax that is presently on gas in this

Province. I believe there should be an incentive for small business in order

that they can (inaudible) in the Strategic Economic Plan this government talks

so much about. They talk about the impact that small business will have on the

growth of this Province and I think there should be an amendment made to the

gasoline tax to help small business operate here in this Province.

I would also like to speak of the people on fixed incomes,

the low income people. Again we get back to the geography of the Province which

is all important to the people who have to travel to the doctors, the banks, or

whatever the case may be. In various parts of our Province people have to travel

long distances and the cost of travelling now in your own vehicle has gone up

tremendously over the past couple of years. Taxi rates throughout the Province,

and package rates throughout the Province, have increased and it all goes back

to the amount of tax we have to pay on our gasoline.

Most important of all, as the tourism critic for our party, I

would like to touch on how important some improvements to the Gasoline Tax Act

would be for the tourism industry in this Province. Millions of dollars are

spent every year on attracting people to Newfoundland and Labrador. We have one

of the greatest tourism potentials anywhere in the world. We spend millions of

dollars to bring people here and then, because of the tax structure and our gas

tax structure, we destroy their holidays. Mr. Speaker, we destroy their holidays

because most people in today's world are on fixed budgets. They budget a certain

amount for their holiday and when they come to this Province they realize that

gas prices in this Province outdo any other province in Canada, and especially

outdo what it costs to travel in the United States. Therefore in order for us to

make our Province the attraction it should be I believe we should make

amendments to the gasoline tax and offer to tourists that visit our Province a

rebate on the tax on gas. I have seen some people stop at gas stations which I

have been to, drive in with larger machines to fill up with gas, and they tell

me it is twenty to thirty dollars extra to fill up their tank than it is in Nova

Scotia. Still we keep on spending million and millions of dollars trying to

attract people here and when we get them here we stifle them.

I also mention that everybody has to pay tax on gas when we

stop at the gas pumps but everybody could save money if we would make amendments

to our Gas Tax Act. Let us take, for example, the Member for St. John's South,

how much money he could save on all his travels if there were amendments to the

gas act and the taxes were shut down. It is for us all, we could all save money

if they make amendments to the Gas Tax Act. I say to the government that I

applaud trying to make amendments to bring more dollars in revenue into our

government, but I also say that you shouldn't stop here. There are many ways to

improve the Gas Tax Act, and therefore many ways to improve the economy of

Newfoundland and Labrador. Thank you.

MR. SPEAKER: The hon. the Member for Menihek.

MR. A. SNOW: Thank you very much, Mr. Speaker. Just a few

words on Bill 25,

An Act To Amend The Gasoline Tax Act, a bill to amend the

Gasoline Tax Act, an attempt to get more revenue from the transport industry

when they are using the highways of this Province. The intent of this Bill is to

generate more revenue from the transport industry - that is, the trucking

industry - which utilizes our highways, and thus they would help pay their

so-called fair share of the costs of maintaining the infrastructure that they

are using, i.e., roads.

In the introduction of this Bill the Minister of Finance

suggested that this is done in tandem, I believe, in conjunction with, in

consultation with, the Maritime Provinces. My question to the Minister of

Finance would be, has there been any consultation with the Province of Quebec on

a similar type of arrangement? Because there is a tremendous amount of goods

that is transported into this Province through Labrador from the Province of

Quebec.

What happens - I've raised it in this House several times -

is that the truckers are filling up their vehicles with fuel in the Province of

Quebec because the gasoline tax, the fuel tax in this Province, is a tremendous

amount higher. It's a tremendous amount higher in this Province than it is in

the Province of Quebec. I would urge the minister to have - I ask that they

would come in with, they would institute, a system of a graduated gasoline tax

in border situations. Because really that is what the Province of Quebec does.

They have a system of a graduate tax to allow competition in the industry in

border situations.

What we've seen here is more regulation put in, attempting to

garner a few more dollars out of the industry. I'm not saying they shouldn't tax

the people who are using the infrastructure, the highways. I'm just wondering

how much actually this is going to cost this Province to administer, and indeed

if we are going to get more revenue, and it is going to help the transportation

industry. Because that is also what we have to do, that's the whole purpose of -

or not the whole, but one of the attractions of building new highways, to

utilize them to transport goods. Of course, now we want to get a revenue from

the people who utilize them in the transporting of goods.

I would ask that they would look a little more broadly, not

just look at the Island portion of the Province. That they must work in

conjunction with the Province of Quebec to have that province, or work with that

province, to attempt to get more revenue from the truckers who are using the

system there, or at least allow them - come in with a graduated tax system in

the gasoline tax and diesel fuel tax that are used in the transportation

industry, so that it would promote the industries within our own Province.

Because when we come in with a graduated tax system what will

indeed happen is that that will promote more purchasing of the goods within our

own Province. When the industry sells more of its products - that is the

industry I am talking about, which of course is the people supplying the

gasoline or the diesel fuel to the trucking industry - when they supply these

fuels, they need to hire people to pump this, to calculate it, and all that is

necessary to go with it. It is creating the opportunity to do more business in

the small business sector.

I would ask the minister to answer those questions and to be

cognizant of the particular problems that exists within Western Labrador

specifically. Thank you very much, Mr. Speaker.

MR. SPEAKER: If the hon. the Minister speaks now he will

close the debate.

The hon. the Minister of Finance.

MR. BAKER: Thank you, Mr. Speaker. I will deal with some

of the points raised by members opposite. First of all this particular Bill says

essentially that an inter-jurisdictional carrier shall pay to the Crown a tax

which shall be calculated by the following formula; the tax payable by the

inter-jurisdictional carrier equals the number of kilometres travelled within

the Province by the fleet - if it is a fleet - during the reporting period,

divided by the ratio between the total kilometres travelled in all jurisdictions

and the total number of litres of gasoline consumed during that period,

multiplied of course by the tax rate for gasoline as set out in our regulations.

This means that it applies to the border at Labrador just as well as it applies

to anything else where the

MR. A. SNOW: (Inaudible).

MR. BAKER: I am not missing that except, as Minister of

Finance, I am dealing with a tax issue. There are many other associated

transportation issues that are properly the jurisdiction of another department

of government. All I can do is introduce the tax measures that are particularly

related to revenue generation, Department of Finance. I know there are other

issues as well. I suppose we could have looked at graded rates - as you get

closer to the border the rates become more and more similar to what is in the

other province and so on but we felt that this was the best mechanism to get us

the amount of money that we are due in relation to the amount of miles travelled

in this Province as compared to the amount of miles travelled in the other

provinces. In other words if the trucker buys gas somewhere else then tax for

the proportion of that gas that is burnt in this Province has to be paid in this

Province and essentially that is what it does.

MR. A. SNOW: (Inaudible) promote small industry. The idea

of allowing a gas station to do more business because they are buying their gas

in another boundary.

MR. BAKER: Yes, I would suggest that people would tend to

avoid filling up just before they leave a province so they do not have to pay

tax in the other province. So in that sense it will generate more business in

here in terms of at least the buying of gas because the basic cost of gas is

relatively the same. The tax is where the difference is. This is intended as a

measure to make sure that we collect our fair share of gasoline tax from

vehicles that are actually using our highways. That was the intent of it. I

guess other measures, in terms of economic development, could be brought in by

other departments in government or other issues with regard to the highways in

the Province that have been brought up by members opposite, could be brought in

by the Minister of Works, Services and Transportation.

The issues relevant to the taxes that were brought up - I

know a couple of members got up and indicated that perhaps what we should do is

reduce taxes and talked about - there are other things that should be done with

taxes. I would like to make it quite clear that in the circumstances of

government - I guess any government - that a Minister of Finance has to, in a

sense, like taxes. He has to dislike it and like it. He has to like it in the

sense that when it comes Budget time there has to be money to provide for the

hospitals, the schools, social services payments and to build roads and to

repair roads and do all of the things that government does. There has to be

money there for that and the way you get it is through taxes. You cannot expect

somebody else to give you all of this money. You cannot expect to get it all in

hand-outs so we have to generate a certain amount of this here and our taxation

system is the way we use - our various taxation systems will be the way that we

use to generate this revenue.

It is easy to say, well let's cut taxes here because it will

please this bunch of people and cut another bunch of taxes to please another

bunch of people but then when you have to close down two or three hospitals that

does not please anybody so that is the logical result of a lot of these

measures.

With regard to the reduction of taxation, we believe where

possible, that we should reduce taxation. We believe that there are certain

instances where a reduction in taxation will generate a benefit that hopefully

is more than the taxes that you are giving up and in those cases we do that,

reduce the tax rates to try to generate revenue more than we would lose by

keeping the taxes in.

If it can be shown for instance, that by reducing the

gasoline tax that will generate more revenue for government, then we will reduce

it tomorrow. As a matter of fact you would be tempted to eliminate it then if

you could create a lot of revenue by eliminating the gasoline tax, but obviously

the case has to be made, and has to be made on a sound basis and if it can then

we will eliminate that particular tax. There are people who argue that the

payroll tax would have that affect and if the payroll tax were eliminated then

much more revenue would be generated than we are now getting from the payroll

tax, and I say to members opposite, if that case is sound and if it can be shown

to be sound, then I would be the first one to recommend elimination of that

tomorrow, and I guess that is the crux of the argument that will go back and

forth across the House, and I guess if we were ever convinced that that would

happen, then we could eliminate that particular tax.

Mr. Speaker, the Member for Mount Pearl is right, this has

been a long time coming. The Bill was printed in the last session but it was

never dealt with; there was not thought to be any hurry simply because the

industry was doing it anyway and there was no particular hurry. I think there

were, in the year previous to that, some implications that had to be checked out

with the federal government, but there was a long delay in getting this into the

House but it has been -

MR. BAKER: Pardon?

MR. WINDSOR: Could you tell us how many provinces

(inaudible).

MR. BAKER: As far as I know now, it is the Atlantic

Provinces that are agreeing with this type of formulation.

MR. WINDSOR: So a carrier from Quebec (inaudible).

MR. BAKER: Yes, they would still have to pay this, yes

according to our formula, based on the number of miles.

MR. WINDSOR: (Inaudible) as compared to what a Quebec

trucker would pay in Newfoundland?

MR. BAKER: I don't know. I hope there is not double

taxation you know, but if in fact there is no such formulation in Quebec then

that would encourage people to come to Newfoundland to fill up, so it would then

mean increased business across the border.

Anyway, Mr. Speaker, I am very pleased to move second reading

of this Bill. There were a couple of other questions asked that related to

highway system, which I would be glad to look into but I do not know the answer

to right now.

Mr. Speaker, I move second reading of Bill 25.

On motion, a bill, "An Act To Amend The Gasoline Tax Act,"

read a second time, ordered referred to a Committee of the Whole House on

tomorrow. (Bill No. 25).

Motion, second reading of a bill, "An Act To Amend The Health

And Post-Secondary Education Tax Act." (Bill No. 26)

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

MR. BAKER: Thank you, Mr. Speaker.

What this Bill does, is to amend the Payroll Tax Act, Health

and Post-secondary Education Tax Act, the one that was referred to a moment ago,

to give effect to what - I believe I announced it in my December statement of

last year, that is when it was announced -which essentially was that there would

be a tax holiday for a year for small business, in terms of new small business,

there would be a tax holiday from the payroll tax for new small business. This

is something that has been in effect since the announcement and it essentially

defines small business, what we mean by small business. That is laid out in

section 2 of the act, so it first of all, provides tax exemption for new small

business during that fiscal year. The second thing it does, and that is the

purpose of

section 3, is to provide tax relief for small business that

previously existed and is not new small business, but wants to add jobs, and it

provides tax relief for the additional jobs that were added during the year, so,

Mr. Speaker, it is very simply to implement that particular policy that was

announced in the December 4 statement of last year.

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

MR. WINDSOR: Mr. Speaker, as the minister just said,

basically all he is doing is putting into effect what was announced in the

Budget. This is one of a number of bills that will come forward from that

statement. I should say from his statement of December, he did not include them

in the Budget but he came in with his Budget, he took great pride in screaming:

there are no tax increases or rates or anything else in his new Budget, no

because he had announced them all in December, to take effect on April 1, or in

some cases before. He had already given us all the pain. He didn't have to do it

when he came through with his Budget some time in March.

Mr. Speaker, it is a tax holiday for small businesses for one

year, tax relief for small businesses that are creating new jobs. One would find

it difficult to argue against that. The only question I guess we can ask again

is, when is the minister going to consider eliminating payroll tax altogether.

It is a disincentive. It is nice to see small business given a break for one

year, but let's give them a break every year. Because this is something that

puts them in a less competitive position with other parts of Canada. It is a

very counter-productive piece of legislation that we have not agreed with. We

didn't agree with it before they brought it in, and we've disagreed with it

every year since.

I think this government is starting to realize that it is

counter-productive. I say to the minister, I realize full well that there is a

certain amount of money that government has to raise in order to supply the

level of service being demanded by the people of the Province. We say to him

again, the payroll tax is not the way to do it. The health and post-secondary

education tax, that's only a name, it has nothing to do with health or

post-secondary education. Every year since this tax was instituted we've had

less funding for both of those services. So I mean, this is absolute nonsense.

If we could see that this money was being directed toward those services one

might have a little bit of sympathy. It is just a feeble attempt to try to hide

a payroll tax under the name of health and post-secondary education. It fools

absolutely no one.

The payroll tax puts every company in Newfoundland that pays

it at a decided disadvantage with other parts of Canada. Very serious as it

relates to the tourism industry, for example.

AN HON. MEMBER: Not Qubec.

MR. WINDSOR: Not Qubec. But we're not competing with

Qubec as much as we are with other Atlantic Provinces. We're really not. You

talk about the tourism industry. Our competition is not with Qubec. In a

national sense I suppose it is. People come to Atlantic Canada. I have a real

problem - I've said this many times before. I know I'm getting off track, but

while I'm into it I might as well finish it. Because I've seen some reference

recently about a great new initiative to promote tourism for Atlantic Canada.

Every time that we've done that in the past, Mr. Speaker,

we've invested money in promoting tourism for Atlantic Canada, 95 per cent of

the benefits go to the three Maritime Provinces, not to Atlantic Canada.

Newfoundland gets a very small percentage of it because tourists look at the

various options. They say: we've seen three Atlantic Provinces, the fourth one

is much the same.

The other difficulty we have in tourism - there'll be a

better time to speak - but the other difficulty we have in attracting tourism

packages is simply costs here. The payroll tax is one of them, higher gasoline

tax is another one, higher tobacco tax is another one, higher alcohol tax is

another one. Tax on rooms and services in this Province is another one.

Everything we have here has a higher tax register associated.

So if you are a tourist operator in Boston putting together a

package to go to Atlantic Canada, and you put the same package together for each

of the four Atlantic Provinces, you would find a very large differential in cost

in Newfoundland for those factors. Then you add to that the difference of cost

of transportation to this Province and we're not competitive any more, if we try

to compete on a one-to-one basis with the other three Atlantic Provinces. If

we're trying to offer the same product you are doing so at a much higher rate,

significantly higher. That is why I say that I don't agree with this joint

marketing of: Come to Atlantic Canada, or Come to Maritime Canada.

AN HON. MEMBER: We're offering a much better product

(inaudible).

MR. WINDSOR: We're offering a much better product, indeed

we are. That is what I was about to come to. That is the whole point. We are

offering a much better product. We're offering a different product. I submit

that there is no benefit in this Province participating in joint marketing with

other provinces of Atlantic Canada. Because we're not marketing the same thing.

We are, but we're not competitive in that product.

So we have to look at our history and our culture and the

natural beauty, the fresh air, the hunting and the fishing, the sea, and all

this sort of thing, that other provinces cannot compete with us on, but trying

to market jointly with them is of no benefit to us. We are much better off

putting one commercial that invites somebody to Newfoundland than in putting out

ten commercials that invites somebody to Atlantic Canada, because we would be

lucky to get 2 per cent of what comes to Atlantic Canada as a result of that

joint marketing, that is the point I am making. But I got into that because I am

saying that because we are at such a disadvantage with taxes that are imposed in

this Province at a level higher than they are in other Atlantic Provinces and

other parts of Canada and other jurisdictions internationally.

When you are competing in an international or a national

marketplace then you have to be competitive with that marketplace, and we are

not. It was fine when we were really looking at our own economy and we were

doing business in Newfoundland, but we are part of a global economy today that

gets into the whole kind of a debate as it relates to NAFTA and these sort of

agreements. Anybody who does not think we are now into a global marketplace is

sticking their head in the sand and they are going to lose badly. I suspect that

is what is happening to us here in Newfoundland, and unless we realize that our

people are small business people, tourism is only one example, but anybody who

is producing a product here that is competing in that global marketplace is at a

disadvantage and we will never build and strengthen those industries in this

Province until we remove some of those disincentives and some of the natural

disadvantages we have because of our geographical location and the simple cost

of doing business here. This government has to take a very close look at it and

start doing something about it.

MR. SPEAKER: The hon. the Member for Ferryland.

MR. SULLIVAN: Thank you, Mr. Speaker.

I certainly agree with the intent to exempt new businesses

from this payroll tax. Of course not many new businesses would end up paying it

anyway. I would be quite interested in knowing the dollar value government would

save by exempting new businesses when you need $100,000 of salary payments in

order to be eligible to pay that tax in the first place, and also to give relief

to businesses by adding jobs. It is really an admission by the government that a

tax on jobs is a very regressive tax, a tax that is putting an underground

economy in place here in this Province. People are watching payrolls so they do

not escalate above the $100,000 level by the end of their fiscal year. People

are hiring people and paying cash so their payrolls are kept down.

AN HON. MEMBER: That is not true.

MR. SULLIVAN: I am reading it in the Financial Post

and I am reading it just recently in the Fraser Institute, they have referred to

the underground economy, I am reading it all around. It is going on all over the

place, and the minister I am quite sure, is well aware in taxation with

reference to liquor and tobacco tax that there is a problem going on there and

it is going on everywhere. There is more underground economies being generated

now by regressive taxes all over this Province, and any specific province or

country that has them is being generated by that regressive taxes. It is

happening here in this Province. If the minister does not acknowledge it is

happening he must be blinded to the issue. It is a real fact here. The payroll

tax, a health and post-secondary education tax, it is called, a very attractive

name, health and post-secondary education tax, over $60 million collected, to

what, to build facilities that you cannot open. Port Saunders has twenty beds

they cannot open because of no money. In Burgeo they cannot open, forty beds in

Grand Bank, there are twenty-two in Burgeo. In Forteau there is a $1 million

facility since the fall of 1992 with no money to open it.

AN HON. MEMBER: That is not true.

MR. SULLIVAN: I am reading from a statement. I can quote

the minister.

AN HON. MEMBER: (Inaudible).

MR. SULLIVAN: Okay, maybe I will talk about him.

AN HON. MEMBER: For your information (inaudible)

MR. SULLIVAN: But there are twenty-two beds that are not

being used. Is that not correct?

AN HON. MEMBER: The X-ray unit is (inaudible)

MR. SULLIVAN: There are twenty-two beds that are not

open.

MR. DUMARESQUE: A point of order, Mr. Speaker.

MR. SPEAKER: Order, please!

The Member for Eagle River on a point of order.

MR. DUMARESQUE: Mr. Speaker, I am sure the hon. member

does not mean to mislead the House but I just want to inform the hon. member

that the Forteau Health Care Chronic Care Centre, the positions are closing on

December 3; by December 15 they will be hired, and by January 4 the facility

will be opened, in accordance with the regular

schedule that we thought we would

have in place when we went through the process of building it.

MR. SPEAKER: There is no point of order.

The hon. the Member for Ferryland.

MR. SULLIVAN: Well, to speak on health and post-secondary

education, I would like to inform the Member for Eagle River, too, and this is

related to health, that in the fall of 1992 the facility in Forteau opened, and

they were given $100,000 to operate the facility, and they needed $250,000 to

operate it, and the minister said at that time, and this is quoted on May 27, in

case the member does not know what is happening down there in his part of the

country, he said: They will have to watch their budget up there. I guess they

will be able to open it fairly late in this calendar year, and that is what we

have in mind. It goes on to say, the facility was ready since the fall of 1992;

they had hoped to have it opened. He goes on to quote the Chairman of the

Grenfell Regional Health Services Board there, Mr. Patey, and he said they

cannot open it. The money is just not there, and it is ready to be opened. - And

that is a quote in The Evening Telegram of May 27 if you want to go back

to it.

AN HON. MEMBER: We need to collect more taxes.

MR. SULLIVAN: Actually, the reality is -

AN HON. MEMBER: That is the argument for more taxes.

MR. SULLIVAN: The argument for more taxes is that a

payroll tax is a tax on jobs. The hospital here in St. John's, the General

Hospital, has twenty-five less positions, less jobs, here in September -

seventeen beds closed. The hospital here at St. Clare's has about a million

dollar cutback - $1.2 million - the Western Memorial Hospital in Corner Brook,

Grand Falls another million dollars. All these cutbacks and jobs, and that is

taken basically from your releases here and from statements by the chairpeople

of these boards. We have all the quotes here, if you doubt them.