April 7,

HOUSE OF ASSEMBLY PROCEEDINGS

Vol. XLI No.

The House met at 2:00 p.m.

MR. SPEAKER (Lush): Order, please!

Statements by Ministers

MR. SPEAKER: The hon. the Minister of Works, Services and

Transportation.

MR. GOVER: Thank you, Mr. Speaker.

Mr. Speaker, as my hon. colleagues are aware, the road

building industry and the independent dump truck operators in particular are

experiencing a very difficult period. Among the challenges they face, a primary

concern is a large oversupply of tandem dump trucks. In an effort to address

this oversupply, government placed a freeze in July, '91 on the number of dump

trucks and dump truck certificates and called for a comprehensive review of the

dump truck industry by the Board of Commissioners Public Utilities.

I am pleased to announce today that the following decisions

have been made based upon the recommendations from the recent Board Enquiry into

the Newfoundland and Labrador Dump Truck industry.

1. In order to stabilize the industry, the freeze on the

number of dump trucks allowed to operate in the Province will be continued and

is confirmed as government policy as stated in The Motor Carrier Dump Truck

Order, 1991.

2. Mr. Speaker, in adopting this legislation, we must be fair

in recognizing there are dump truck operators who have been working in this

industry for years and have been caught in the moratorium of dump truck

certificates through no fault of their own. To this end, the Department of

Justice, in consultation with the Department of Works, Services and

Transportation will prepare the necessary regulations and Orders under the Motor

Carrier Act, 1990, to allow the Registrar to reinstate certificates for those

carriers who held certificates in the April 1, 1990 to March 31, 1991 operating

year. Mr. Speaker, this will permit these traditional dump truck operators to

resume work.

3. The Board of Commissioners of Public Utilities will

continue to regulate rates. In the near future, a review of the asphalt and

hourly rates shall be undertaken by the Board as these rates were the subject of

much debate during the hearings.

4. The Board of Commissioners of Public Utilities and the

Registrar of Motor Vehicles have been directed to report to me yearly on the

state of the dump truck industry.

5. The Department of Works, Services and Transportation will

continue to apply the provincial government's General Conditions of Contract.

This means the department will have no involvement in a contractor's hiring

practices; in particular, we shall not dictate any percentage of hire on the

basis of faction location and/or type of equipment.

6. The Department of Justice, in consultation with the

Department of Works, Services and Transportation, will prepare amendments to the

Motor Carrier regulations to again, again, Mr. Speaker, increase the fines for

contractors and/or subcontractors found guilty of not paying the PUB prescribed

rates to independent truckers. Those contractors violating regulations as set

out in

Section 95(3.1) will be fined to a maximum of $25,000 (with a minimum of

$5,000). Mr. Speaker, I would indicate this is a tenfold increase in the current

penalties which were increased by this administration previously, tenfold, I

believe. In addition to that penalty, any contractor found guilty of violating

the rates by not paying the prescribed rates will be prohibited from bidding on

Department of Works, Services and Transportation contracts for one year.

7. Counterbalancing this regulatory penalty, the hon. the

Minister of Justice will request assistance from the enforcement agencies to

control disruptions and mischief at project sites. I recognize the level of

frustration experienced when work is not available, however, this is no excuse

to violate the law, and such violation cannot be condoned.

8. The Department of Justice, in consultation with the

Department of Works, Services and Transportation, will prepare the necessary

regulations to permit the Board of Commissioners of Public Utilities to suspend

for a period of one year the operating authorities of any carrier found guilty

of offenses which lead to the creating of instability in the trucking industry.

9. Mr. Speaker, I must confirm that independent truckers will

remain ineligible for subsidies from the provincial government. Government

cannot resolve excess capacity in any industry by a program of ongoing

subsidies.

10. The Department of Works, Services and Transportation,

through the Motor Registration Division, will conduct investigations into

complaints from independent truckers. Mr. Speaker, while I cannot divulge

details of ongoing investigations, let me assure you recent complaints brought

to my attention are being dealt with.

11. Also, Mr. Speaker, municipal governments will maintain

their exemption from the Motor Carrier Act, 1990.

As well, Mr. Speaker, I am releasing to the public the report

of the Board of Commissioners of Public Utilities on this matter.

We feel these decisions adopted by government are positive

measures and provide for fairness and balance in addressing the concerns of

government, independent truckers and contractors. Combined with the co-operation

of independent operators and the construction industry in general, these steps

will go a long way to begin a process of change that will result in an overall

improvement in the way the dump truck industry is structured and operates. I

also make a commitment to an ongoing evaluation process.

Mr. Speaker, I would like to conclude by expressing my

appreciation to the Board of Commissioners of Public Utilities for their

assistance in this particular matter.

Thank you, Mr. Speaker.

SOME HON. MEMBERS: Hear, hear!

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

West.

MR. TOBIN: Mr. Speaker, I would like to say that the

minister just dropped off a copy, or at least someone from his office dropped

off a copy just prior to me coming to the House, and I have only had time to

read it since I came here. I would appreciate it if the minister could make sure

that it gets to my office, particularly a report of this size, a little bit

before 1:50 p.m., when the House opens at 2:00, as other ministers do. Then it

would give me a chance to study it.

Mr. Speaker, as I understand it for some time there have been

a group of truckers in this Province who have been asking Government for the

right of registration. That is not what has happened by this certification. That

is not what has happened in this ministerial statement today. The wishes and the

requests of the dump truck association in this Province has once again been

totally ignored by this administration. For some reason they do not want to give

certification to dump truck operators in this Province. The minister has said

the freeze will be continued. That is nothing different, that is what we had

last year.

He talks about the Motor Carriers Act, 1992, to allow the

registrar to arrange certificates for those who held certificates from April 1,

1990 to March 31, 1991 operating this year. He further goes on to talk about

various issues as it relates to what his department will be doing. This means

that the department is going to have no involvement in the hiring practices and

whatever else may happen. He brings in some heavy fines for contractors found

violating and I recognize, Mr. Speaker, that is a very good move to increase the

amount of funding that will be provided. Then he goes on to say - and this is

very interesting, this is what is very interesting in this report, Mr. Speaker,

the minister goes on to say there will be no more disruptions. The Government

will not tolerate any further disruptions: this means the operators will not

have the right to protest anymore and if there is a demonstration put on by dump

truck operators, as I read this, they will be suspended from operating for up to

one year. If the dump truck operators decide to protest, the right that everyone

else in this Province and everywhere else in a democracy have, if they decide to

have a demonstration for a day they will lose their licence for up to one year,

as I understand from reading this, and that is shameful. Then he goes on to talk

about - in conjunction with the Minister of Justice. Mr. Speaker, where is the

Minister of Justice? It is fine to have a Minister of Justice who is barred away

in an office on the fifth floor and cannot be questioned in this Legislature,

well it is about time he got a seat in this Assembly so that we can ask

questions of him regarding this implementation and others. The fact of the

matter is quite simple, there have been polls done, as I understand it, there

have been polls taken in three districts which show that the Minister of Justice

cannot win either one and that is why he hasn't got a seat in this legislature,

Mr. Speaker. That's why he is locked away on the fifth floor.

AN HON. MEMBER: Gone south to run.

MR. TOBIN: But that's what is happening here.

Now, Mr. Speaker, there is nothing here dealing with the

certification of dump truck operators in this Province, and it is about time the

minister stopped ignoring the dump truckers and their requests, as the previous

minister did, and give them the right to certification.

Oral Questions

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

SOME HON. MEMBERS: Hear, hear!

MR. SIMMS: Mr. Speaker, I have some questions for the

President of Treasury Board. The Government has served notice that it intends to

bring in Bill 17, which will extend the public sector wage freeze to the year

1992-93 and provide for a maximum salary increase of 3 per cent, I think it is,

in 1993-94.

Last year's Bill 16 postponed the negotiated contracts that

the government had with its public sector unions for only one year. Is it now

the government's intention then, to wipe out completely the wage and benefit

increases negotiated by this government with its public sector unions for the

years 1989 and 1990?

MR. SPEAKER: The hon. the President of Treasury Board.

MR. BAKER: Mr. Speaker, during the last fiscal year we

have been under restraint and all public sector unions and all public servants

in the Province have been under restraint with 0 per cent increase. Our

intention is to bring in a bill and that is for this past fiscal year, 1991-92.

For 1992-93 there will be a 0 per cent total compensation. It cannot exceed 0

per cent, and for 1993-94, total compensation will not exceed 3 per cent. So

this would total two years of zero, and to come out of the two years of zero, a

year of not beyond 3 per cent total compensation. That is all I can tell the

hon. member. All other conditions remain the same, but these will be the

compensation increases for that period.

MR. SIMMS: A supplementary, Mr. Speaker.

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

MR. SIMMS: The minister has confirmed then, I guess, that

they do intend to wipe out the contract agreements made with public sector

unions for last year by extending it now for another year even though they

brought in legislation last year to extend it for only one year, so they intend

to do the same thing again.

The government and the Premier often refer to the number of

meetings they had with the public sector unions, leading up to the Budget, and

so on, over a period of months. I want to ask the President of Treasury Board:

Did the government at any time during these last several months leading up to

the Budget, ever formally request that the unions re-open their existing

contracts for negotiations? Did they ever make that formal request so that you

could have negotiated something over the last several months? If not, why not?

MR. SPEAKER: The hon. the President of Treasury Board.

MR. BAKER: Mr. Speaker, the hon. member has a way of

standing up to ask a question, first of all, then misstating what was said

previously. I say to the hon. member that I said what I said and I don't need it

improperly misstated by the hon. gentleman.

Now, in answer to the question. We were not bargaining. We

were simply sitting down with the public sector unions and offering them a

chance to become part of the solution to this very serious problem that we have

encountered in the last year or so. We have offered them an opportunity to

become partners in terms of making fundamental decisions that affect their lives

as well as the lives of all other people in the Province. We offered them that

opportunity in many meetings. We simply provided information on the financial

position of the Province, day by day, week by week, the most up-to-date

information we had at the time.

That was the process we were doing. This was not a bargaining

process, it was an offer to allow the unions to become part of the fundamental

decision-making process of government. Unfortunately, as I have said before,

they chose to be part of the problem and not part of the solution.

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

MR. SIMMS: Mr. Speaker, I have to try to interpret what

the President of Treasury Board says. Somebody has to try to interpret what the

President of Treasury Board said. Because this government have become known as

masters of verbal illusion and verbal trickery, that's the problem.

SOME HON. MEMBERS: Hear, hear!

MR. SIMMS: Let me ask the President of Treasury Board

this question, if I might. With respect to the NTA - specifically the NTA -

government agreed with the NTA to allow a reopener clause for this year on

everything in their contract, including wages. Does it intend to destroy that

particular provision or that particular agreement for this year with the NTA? If

so, how does it intend to eliminate that particular provision? Through

legislation, through Bill 17, or what other mechanism? I know he met with them

this morning. Perhaps he can tell me.

MR. SPEAKER: The hon. the President of Treasury Board.

MR. BAKER: I'm sorry, Mr. Speaker, if the hon. gentleman

doesn't understand my answers. Maybe he isn't used to the straightforward truth.

SOME HON. MEMBERS: Hear, hear!

MR. BAKER: Now, Mr. Speaker, in terms of the NTA, which

is his third question, there was a provision under

Schedule H of the collective

agreement that anticipated the second year of wage restraint. Under these

conditions the contract would be reopened. On Thursday of last week, I received

a request from the NTA to reopen negotiations, and they suggested the earliest

date possible, which they thought would be this morning at ten o'clock. So, Mr.

Speaker, we reopened negotiations this morning at ten o'clock with the NTA.

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

MR. SIMMS: Thank you, Mr. Speaker. I am tempted to ask

the minister how long he thinks negotiations will continue, but I will leave

that one for now.

Mr. Speaker, I have a supplementary for the Minister

responsible for Labour Relations in the Province. With respect to the question I

just asked the President of Treasury Board concerning the breaking of the

agreement and contract with the NTA, I want to ask the Minister of Labour: Does

he think, as Minister of Labour Relations for this Province, that this is fair

labour practice for his government to be taking with the NTA?

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

Labour Relations.

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

In this instance, as I understand it fully in discussing the

matter with the President of Treasury Board, there is a round of negotiations

which commenced this morning between government and the Newfoundland Teachers'

Association, which is what the NTA and, as I understand it, all of the public

sector unions want to do with this government, get back to negotiations. So

there couldn't be anything fairer than that in the sense that a full round of

bargaining commenced as of this morning.

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

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

MR. SIMMS: Mr. Speaker, I want to ask a final

supplementary of the Minister responsible for Labour Relations. I want to ask

him: Would the provincial government permit a private sector employer to do what

the government itself is doing with its public sector unions and specifically,

if they did, what action would he take, as Minister responsible for Labour, if a

private sector employer ignored the labour laws of the Province and tore up its

contracts with its employees? What would the Minister of Employment and Labour

Relations do then?

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

Labour Relations.

MR. GRIMES: Mr. Speaker, if such an occasion should arise

we would deal with it in an appropriate fashion. We have no indication that

anyone in the private or public sector is doing anything to violate the law of

the land and the labour laws. What we have is, decisions will be made and

ratified in this Legislature which will make that the then law of the land as it

applies to a set of rules and regulations.

If there is something to be dealt with, it will be dealt with

in an appropriate fashion at the appropriate time. Hypothetical questions don't

really do anything to add to anything we are about to do in the Province.

AN HON. MEMBER: Idi Amin! Well done, 'Idi'! 'Idi' upset

him.

MR. SPEAKER: Order, please!

I want to remind hon. members that it is not appropriate to

refer to hon. members in ways labelling governments not practiced in this

Province. Our authorities are filled with those kinds of orders and regulations.

The hon. member did not refer to anyone in particular, but the Chair just wants

to bring that to the attention of hon. members.

The hon. the Member for Humber East.

MS. VERGE: Thank you, Mr. Speaker.

I have a question for the Premier. Before the Premier leaves

the Province again on business, and before the House recesses for Easter, I

would like to ask the Premier once again about the failure of the police to

respond correctly to the sexual assault complaint against the Member for

Naskaupi, at the material time a member of the Premier's cabinet.

Mr. Speaker, it appears to everyone that there are two

possible explanations for the nineteen month delay in the police investigation.

One is police negligence involving the RNC losing a file on a cabinet minister.

The other is deliberate stalling, or political interference.

My question is: Why will the Premier not agree to have a

judicial inquiry into the police response, as I have requested? Secondly, surely

the Premier realizes that I am not asking for an enquiry into the substance of

the sexual assault complaint. Presumably now that will be dealt with by the

police and the Crown attorneys. I am asking for a judicial inquiry into the

police response from August of 1990 when the complaint was made.

MR. SPEAKER: The hon. the Premier.

PREMIER WELLS: Mr. Speaker, I referred the hon. member a

week or so ago when she asked this question, to the decision of the Supreme

Court of Canada, I believe it was the Patti Starr decision, where they decided

that such an inquiry is an improper inquiry and may well prejudice the proper

prosecution. I think it was the Starr case. I have forgotten. Maybe it was

another case, but it was a decision about a year or so ago.

Now we do not want to do anything that is going to prevent

the proper administration of justice. When this matter is properly completed,

and the police have completed their investigation, and if any charges are to be

laid the police will decide whether to lay them or not, I can assure all hon.

members that whatever inquiry is necessary -

AN HON. MEMBER: You already (inaudible).

PREMIER WELLS: Mr. Speaker, if the hon. member who is

making that noise will refrain from making such noises, I will attempt to answer

the question, but I have no intention of engaging in a shouting match with

somebody who does not know what he is talking about.

AN HON. MEMBER: (Inaudible).

MR. SPEAKER: Order, please!

PREMIER WELLS: Mr. Speaker, when the police have

completed their investigation and decided whether or not they will lay charges,

a matter that is entirely for their decision, I have no doubt that the Minister

of Justice will take whatever steps are necessary to ensure that if there was

any laxity on the part of the police, it is exposed and dealt with. Now if a

judicial inquiry is necessary to achieve that, I can also assure hon. members

that it will be done. But if a judicial inquiry is not necessary in order to do

that, then I have no intention of creating these witch-hunts to satisfy the

whims of the opposition from time to time.

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

MS. VERGE: Thank you, Mr. Speaker.

I would like to ask the Premier if he has a legal opinion

from the Department of Justice on the effect of the Supreme Court of Canada

decision on my call for a judicial inquiry into the so-called 'Kelland affair'?

Next, I would like to ask the Premier why he cannot make a

commitment now that at the culmination of the police investigation, however that

may conclude, that he will have a judicial inquiry? Everyone realizes that

whatever the outfall from the police investigation in terms of whether or not

charges are laid, there still remains the historical fact that there has been a

nineteen month delay in the RNC response, and that after fourteen months -

MR. SPEAKER: Order, please!

The hon. member should get to the question. The hon. member

is now making a speech.

MS. VERGE: Thank you, Mr. Speaker.

After fourteen months the Constabulary told the complainant,

in the presence of the NDP leader, that the Constabulary had accidentally

shelved the file -

MR. SPEAKER: Order, please!

On a couple of occasions the Chair has reminded the hon.

member about getting to the question. The hon. member just proceeds to say what

is to be said, and the hon. member ought not to do that. When the Chair asks her

to get to the question, the hon. member should get to the question. I think the

question has been asked, so we will address the Premier.

PREMIER WELLS: Mr. Speaker, the hon. member is not

interested in a question - just a little political grandstanding - and that is

pretty obvious for all to see.

Mr. Speaker, let me assure the House that I will cause a

judicial inquiry to be held if there is any shred of credible belief that

anybody on this side of the House - anybody - caused any delay in the proper

carrying out of a police investigation. If there remains a shadow of a doubt -

other than in the minds of people who are politically bigoted toward that

position anyway, and want to convey that impression - but if there remains any

credible shadow of a doubt as to whether or not there was any interference on

this side of the House, I can assure the House there will be a full-scale

judicial inquiry.

AN HON. MEMBER: Cover-up! Cover-up!

SOME HON. MEMBERS: Hear, hear!

PREMIER WELLS: Now, Mr. Speaker, other than that I have

no intention of acting as the former government did when the opposition

criticised them at the time of running scared and failing in their duty to

administer justice in an impartial and fair way. They ran scared, and to hide

and cover their own political uncertainties they rushed out to cause people to

be hurt. Now this government has no intention of causing persecution in that

way. We intend to see to the full, fair, complete and proper administration of

justice. If there is ever any credible doubt whatsoever about the administration

of justice, or any suggestion of interference, we will cause a judicial enquiry

to be held.

MR. MATTHEWS: (Inaudible) covered it up, your minister

should be charged.

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

MS. VERGE: Thank you, Mr. Speaker. This is a new

question, although before I get into that I will note that the Premier indicated

he does not have a legal opinion from the Department of Justice about the effect

of the Supreme Court of Canada decision.

PREMIER WELLS: I did not say any such thing.

MS. VERGE: Mr. Speaker, my new question begins with a

preamble. On March 30 I asked the Premier if Doug House had repeated to him what

the complainant told Dr. House about her complaint to the police. The

complainant discussed the matter in detail with Dr. House over a year ago. The

Premier said he did not remember talking to Doug House about it. I will ask the

Premier again. Did Doug House repeat to you what the complainant told him? Or

did you learn from any other source what the complainant told Doug House?

MR. SPEAKER: The hon. the Premier.

PREMIER WELLS: Mr. Speaker, let me do the same as the

President of the Council did. The answers to the questions are the answers I

have given. The restatement of a position by the hon. member is totally

incorrect. I said no such thing.

Now with respect to the question she has just asked, my

answer is the same as it was the other day when she asked. I have no

recollection whatsoever of Doug House telling me any such thing. Nor do I have

any recollection that anybody else told me that Doug House - other than the

member asking it - I have no real recollection of any such discussion with Doug

House. Now, it is entirely possible that Dr. House may say that he did discuss

it with me. Maybe he did. But I have no recollection whatsoever of it.

MR. SPEAKER: The hon. the Member for Torngat Mountains.

MR. WARREN: Thank you very much, Mr. Speaker. My question

is to the Minister of Finance. On Budget day the Minister of Finance announced

in the Budget that he was getting rid of school tax and bringing in personal

income tax, to be increased by 2.5 per cent this year and 1.5 per cent next

year. Would the Minister of Finance advise if those increases will apply to the

residents of Sheshatshit, Rigolet, Makkovik, Hopedale, Postville, Davis Inlet

and Nain?

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

DR. KITCHEN: Mr. Speaker, the increase in income taxes

will apply to all those who pay income taxes in the Province.

MR. SPEAKER: The hon. the Member for Torngat Mountains.

MR. WARREN: Thank you very much, Mr. Speaker. The

Minister of Development and the President of Treasury Board in July of 1989

agreement had been allotted to the school boards in Labrador for education in

the designated communities. Now I ask the Minister of Finance: by increasing

this taxation, does he not consider this a double taxation on the people in

Torngat Mountains district?

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

DR. KITCHEN: Thank you, Mr. Speaker. No, Mr. Speaker,

there is no double taxation. I do not know what the member is getting on with

about double taxation. I do know though, that Labrador generally will benefit

pretty well from the equalization that we will be applying.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The hon. the Member for Torngat Mountains.

MR. WARREN: Mr. Speaker, does the minister realize that

this year alone a grant in lieu of taxes has been given by this agreement from

the federal government to the school boards, for the operation of schools in

those communities? Now, would the minister consider amending this personal

income tax to not apply to the residents of those communities or, would the

minister consider taking the 60 per cent of the $105,000 from this year's

budget, that the federal government is going to give to this government, and

give it to the people in the district of Torngat Mountains?

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

DR. KITCHEN: No. Mr. Speaker.

MR. SPEAKER: The hon. the Member for St. Mary's - The

Capes.

MR. HEARN: Thank you, Mr. Speaker.

My question is to the Minister of Education.

The minister said several weeks ago he would look into the

cash flow problems that school boards were experiencing as a result of less than

expected school tax revenues since January. Has the minister completed his study

and does he know now how big the problem is?

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

DR. WARREN: No, Mr. Speaker, we have not completed that

assessment. We know there are areas of the Province where School Tax Authorities

are collecting what they collected last year and what they expected to collect

this year. There are other areas where the collections are down and I assure the

hon. member that we are going to study that, and if action is necessary, the

government is prepared to help those areas where needs are real.

MR. SPEAKER: The hon. the Member for St. Mary's - The

Capes, on a supplementary.

MR. HEARN: Mr. Speaker, I heard the minister say some

time ago that school tax revenues were up significantly in certain areas. The

school tax revenues for the two St. John's school boards are down $400,000 in

the first quarter and these are accurate figures as of today, and they are

expect to be down $800,000 by the end of June. Since from June on the school

boards will have to rely completely on government funding, what does the

minister intend to do to help the St. John's school boards pay the bills they

cannot afford to pay now, due to less revenue than expected?

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

DR. WARREN: Mr. Speaker, some of the collections are down

but we expect the people of the Province to pay. They know this is a tax, it is

a legitimate requirement that people pay taxes, and we are going to enforce it

and we expect that most boards will collect an amount equal to or greater than

what they collected last year. Mr. Speaker, some boards may have to borrow a

little money in the interim. There are a number of options open to the boards,

but I assure you that we expect the people of the Province to pay before the end

of June, and if not, we will initiate actions to collect after that.

Mr. Speaker, I would like to add one other thing. All I have

heard the hon. member discuss in this House is the cash flow problems. Does he

not realize that beginning in July, for the first time, since we initiated this

school tax, there will be additional monies put into the revenues of many boards

in this Province and we will have, Mr. Speaker, a quality of opportunity as far

as revenues for school board operation and maintenance are concerned.

MR. SPEAKER: The hon. the Member for St. Mary's - The

Capes.

MR. HEARN: Thank you, Mr. Speaker.

The minister is talking about the extra funding put into

school boards, but the minister should recheck his figures and he will find out

there is actually no extra money going to school boards. By the time they figure

out the CPI, boards will have less money next year than they had this past year,

and I ask the minister again, despite the fact that they might -

AN HON. MEMBER: Not true.

MR. HEARN: Not true, we will talk about it later on today

in the Budget. I ask the minster: since the St. John's school board and that is

only one, there are several others- the money so far received is down

significantly over the same time last year, there is no indication that the

boards are going to get the money and the minister did not answer the question,

What is he going to do besides hope and pray that the public pays?

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

DR. WARREN: Mr. Speaker, I do not know what the hon.

member is reading or what he is hearing, but we put into the Budget for this

year, for the nine month period, $9 million more than school boards had put in

through school taxes, $9 million. $12 million a year.

Mr. Speaker, $12 million a year will be available, a lot of

it I must admit will go to rural areas of this Province, because we are not

going to tolerate what the former government tolerated for years. We are not

going to tolerate it. I am not going to tolerate it as a minister, Mr. Speaker,

and this government is not going to tolerate it.

Now with respect to the question of cash flow problems we are

looking at a variety of options, we have an implementation committee examining

these options, and in due course we will take the appropriate action.

MR. HEARN: My final supplementary, Mr. Speaker.

MR. SPEAKER: The hon. the Member for St. Mary's - The

Capes on a final supplementary.

MR. HEARN: I wonder will the minister show us where in

his Budget there is an extra $9 million for school boards in this Province?

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

DR. WARREN: Mr. Speaker, I will get the figures for him

and go through the - there is a nine month period there, grants are increased. I

think it is $30-something million, $27 million to replace the school tax, and $9

million more, Mr. Speaker. It is there, and I will provide the data for the hon.

member. I assure him one other thing, this government will not bring back the

school tax.

SOME HON. MEMBERS: Hear, hear!

DR. WARREN: I tell you they can keep on. If they want the

school tax they can have it. This government will not restore the school tax,

Mr. Speaker.

SOME HON. MEMBERS: Hear, hear!

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

West.

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

Mr. Speaker, I have a question for the minister who doubled

the school tax. Some time ago, Mr. Speaker, the former member for Port de Grave

and his Minister of Social Services promised the single mothers attending

university that they would put in place a committee that would study what was

happening in terms of making post-secondary education available to the single

mothers of this Province.

Mr. Speaker, that committee was put in place, the findings

were submitted to the minister and changes were made to the Department of Social

Services to accommodate the request. What is happening now, Mr. Speaker, is that

single parents at Memorial University are being penalized by the Department of

Education by reducing their provincial grant because of the social services

increase. Let me ask the Minister of Education, Mr. Speaker, did he not reassure

the Women's Resource Centre at Memorial University that such a thing would not

happen?

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

DR. WARREN: Mr. Speaker, I really appreciate this

question. The hon. member has asked an important question. I do not have all the

details, but let me give him the answer as I recall, Mr. Speaker. This is a very

important question.

Yes, there have been some problems with the application of

the regulations by both departments. We are concerned that some grants and some

loans are being considered income by students who are on social services. These

students have appealed to the Appeals Committee. The government has established

an Appeals Committee, and these students have appealed. I was informed late last

week that the Appeals Committee has deferred consideration of these appeals

until we have had a full discussion with the Department of Social Services. I

have had discussions with the minister and we will attempt to resolve that. This

government is committed to treating single parents who are students fairly, Mr.

Speaker, and I assure the hon. member that we will do everything possible to see

that they are treated fairly.

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

West.

MR. TOBIN: Mr. Speaker, I guess the minister has another

group who will refuse to shake his hand.

Let me say to the minister, Mr. Speaker, that he has just

confirmed the worst fears of the single parents regarding their grant structure

at Memorial University, because what the minister is saying, and I will ask him

to confirm it, is that there will be a process now put in place that will see

the end of this semester - the semester will have come and gone - before they

will receive any of their funding from Memorial University. Is that what the

minister is now telling these people when all they are asking for is a fair and

balanced education, Mr. Speaker? Will the minister now also confirm that he did

tell the Women's Resource Centre at University that what is happening would not

happen, and will he apologize to the single parents in this Province for the

hardship he alone has created?

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

DR. WARREN: Mr. Speaker, I do not where to start to

correct some of the misinformation that was included in the hon. member's

statement, but I will assure you that this only got to the Appeal's Committee

very recently. There is at Memorial, an advocate who works on behalf of these

single parents. We have been in conversation with that person, a Ms. Peddle. She

is actively seeking to resolve this problem and we as a government are anxious

to resolve it. We want to treat all persons fairly. I remind the hon. member

that two years ago we increased the grants to single parents and others with

dependents by 27 per cent. It was the first time that grant had been increased

in ten years and we are going to continue to improve the student aid program. I

am hoping that the Department of Social Services and my department can resolve

this matter at the earliest possible date.

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

West on a supplementary.

MR. TOBIN: Mr. Speaker, you could increase it by 100 per

cent if you are going to take it back by 100 per cent from another department.

That is what the minister is doing. He is robbing the 27 per cent he has now

taken back.

AN HON. MEMBER: (Inaudible)

MR. TOBIN: Yes, Mr. Speaker, Ms Peddle is very actively

involved in trying to have this resolved and she is extremely frustrated because

of the way the Minister of Education has handled this issue.

MR. SPEAKER: Order, please!

I ask the hon. member to get on with the question.

MR. TOBIN: Let me ask the minister if he would make a

commitment today that he will indeed honour his word he made a couple of years

ago and immediately put in place what was agreed upon in the committee in the

Department of Social Services? I ask him the second time if he would apologize

to the single parents of this Province who he has created so much hardship for?

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

DR. WARREN: Mr. Speaker, I am delighted to say that since

I became minister I have held a series of meetings with single parents and with

students from all over this Province. I have shaken hands with thousands and

thousands of students. We are trying to do what is right and within the

regulations we will do everything possible to ensure that these students are

treated fairly.

MR. SPEAKER: Question Period has expired.

Presenting Reports by

Standing and Special Committees

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

Labour Relations.

MR. GRIMES: Mr. Speaker, I am tabling today in this House

of Assembly the 1991 Workers' Compensation Commission Annual Report. There are

just a couple of things I would like to point out to all hon. members.

The report provides a comparison of program costs and

utilization in 1991 compared to the previous year's experience. It reveals that

although new claims reported in 1991 are below the 1990 levels, total program

costs are up considerably on account of payments for prior year injuries.

Also, Mr. Speaker, the 1991 annual report also contains the

financial statements of the commission for the year ended December 31, as well

as an updated actuarial valuation of liabilities based on claims experience to

this date. The financial situation now facing the commission, Mr. Speaker, is

more serious than previously estimated as there is now a projected unfunded

liability in the range of $160 million.

The results of the latest annual report emphasize the need

for action to be taken to sustain an adequate and affordable system of workers'

compensation in the Province. Cabinet is currently addressing a variety of

approaches in this area and I expect to be able to respond to the 1991 Statutory

Review Committee Report shortly. I commend the report to everyone's attention.

Answers to Questions

For which Notice has been Given

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

DR. KITCHEN: Mr. Speaker, I don't know if you will rule

this in order or not, but yesterday the Member for Fogo asked me some questions

about the payroll tax on fish plants and I answered them briefly. I have some

more information to give, if you and others feel that it is the appropriate

place to respond.

MR. SPEAKER: The hon. the House said yes, by leave.

DR. KITCHEN: The member was concerned that some fish

plants were paying more than $50,000 in payroll tax. He asked the question:

Whether fishermen would be included in the payroll? The answer to that is that

individual fishermen are not considered to be on the payroll of fish plants, but

they sell their raw materials to them. For unemployment insurance purposes, I

believe, there is a special arrangement in that regard.

Now, there is another point I would like to just follow up

on. There are only two fish plants in the province whose payroll tax will exceed

$50,000 and from that there has to be deducted whatever school tax they are

paying.

Orders of the Day

MR. BAKER: Order 11, Mr. Speaker.

MR. SPEAKER: Order 11.

Motion, second reading of a bill, "An Act To Amend The Public

Utilities Act, 1989." (Bill No. 18)

MR. SPEAKER: The hon. the Minister of Mines and Energy.

DR. GIBBONS: Mr. Speaker, on behalf of my colleague, the

Minister of Justice, I am pleased to move second reading of this small

amendment: "This bill would exempt from regulation by the Act a person or

corporation which engages in the hydro generation of electricity provided the

generating capacity at each site is 15 megawatts or less and the electricity

generated is sold to a public utility regulated under the Act."

In The Public Utilities Act now there is a one megawatt

limitation and, as hon. members will recall, many months ago we announced a

change in policy that we would be making the limit ten megawatts. After much

discussion and assessment of this we have decided to make it fifteen, because it

fits in conveniently with the regulation under Revenue Canada rules.

This particular bill has just one clause, 3.1, which is being

added to the Act. The first part of it is making that change from the one

megawatt to fifteen megawatts, and the second part of it is exempting

corporations which are regulated utilities.

I move second reading.

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

MR. WOODFORD: Just a few short comments, Mr. Speaker, on

this particular bill. Mr. Speaker, as far as I am concerned this is something

positive and something that is going to be acceptable to a lot of companies, not

only in this Province but outside, who are willing to put dollars up to partake

and to construct mini-hydro sites in the Province.

I have to commend the minister on this as well, Mr. Speaker.

I was involved personally over the last couple of years, ever since the

announcement on the mini-hydro sites in, I think, the l989 Budget with a few

companies around the Province who have tried very hard to establish mini-hydro

sites in different areas. They have been stymied time and time again, primarily

by Newfoundland Hydro, and I can see now the reasons why. They mistook some of

the, I suppose, comments coming from Hydro as barriers, as if Newfoundland Hydro

were trying to put up barriers to the development of those sites.

I talked to the minister and asked him questions, last fall,

in the House. I have talked to him in the last month or so, since the House

opened, and I have to commend him on, as far as I am concerned, a job well done

in trying to get Newfoundland Hydro involved and trying to get his people

involved, including his Cabinet colleagues, to try to bring a piece of

legislation to this Chamber that is positive, that will create jobs in this

Province and that will enhance, I suppose, the assets of Newfoundland and

Labrador Hydro so they will not have to go out and borrow; especially now, when

times are so bad, they will not have to do any of those sites themselves. It is

an example, though, of what can happen in a Budget. That was announced, if I am

not mistaken, in the Budget in the spring of 1989 or the spring of 1990.

AN HON. MEMBER: Spring of 1990.

MR. WOODFORD: Yes, the spring of 90 in a Ministerial

Statement, where the government was willing to go ahead with those mini-hydro

sites. It was, I think, announced at that time the maximum would be ten

megawatts, yet we are here today - two years later - trying to bring in a piece

of legislation to amend a decision that was made two years ago. We thought

everything was above board; we thought we could go on and proceed with this

particular kind of project but now we find out we could not. At least, now, it

is on the floor of the House, and I say to all members that this should be given

speedy attention through this House. All approval should be given so that people

can proceed with those particular projects. I would like to comment a little

further and say that I have found through the people I have been involved with

that there is not one cent, not one copper of government funding going into the

projects I am familiar with. I have seen some on the Island that have made

application for, and acquired ACOA funding, but if I were on the ACOA board, I

would not give one cent to anybody looking for funding. Those sites are viable.

When Newfoundland Hydro calls for proposals they will be done on a viable basis

by whatever company presents a proposal.

One of the concerns I have, and I would like for the minister

to take this under consideration and pass it along to Newfoundland Hydro

officials: A lot of companies have done an awful lot of work in the past couple

of years on particular sites around the Province, to the extent where some of

those sites have been approved, have gone through environmental assessments and

in some cases environmental assessments have been waived. I would think that

Newfoundland Hydro, once this bill is passed, will ask for proposals again. I

just hope that Newfoundland Hydro in their wisdom do not try to negate, and do

not try to dismiss any of those companies that have already put an awful lot of

dollars, time and effort into recognizing some of the sites in the Province. I

hope they take that into consideration. I know pricing is going to be a big

thing. I say to the minister that he should probably talk to Newfoundland Hydro

officials and make sure they take into consideration those companies which have

put a lot of time, effort and dollars, their own money, into identifying sites.

In fact, I know of one in my area which is ready to go tomorrow morning with $13

million of their own funding to start a particular project in this Province. I

wouldn't want to see a company like that go by the wayside just because they had

come in with proposals before an amendment came in to Newfoundland Hydro's

regulations. I understand, under this particular piece of legislation, that now,

any private individual or corporation in the Province, or outside, who starts a

mini-hydro site, meaning anything up to fifteen megawatts will not have to go

the Public Utilities Board for approval. That is one of the good things under

this particular piece of legislation.

Also, I think, one of the reasons why the minister and

Newfoundland Hydro kept it at fifteen is because of the fact that, I think,

there are some goodies there from Revenue Canada for any corporation which

invests up to fifteen megawatts.

AN HON. MEMBER: (Inaudible).

MR. WOODFORD: Yes. So that is a plus, as well.

So, Mr. Speaker, in order to create jobs, in order for

private enterprise in this Province and outside to participate in some major

development in the Province without Newfoundland Hydro getting involved, I say

to the minister, I commend the minister for bringing this particular piece of

legislation to the House in such a speedy manner. I will say to all members that

they should act likewise and let it go through the House. I tell the minister

again to make sure he notifies Newfoundland Hydro and has a talk with those

people, that those particular companies that have been involved up to this date

should be given some preference when it comes to any projects being approved.

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

MR. HARRIS: Thank you, Mr. Speaker. I would like to speak

briefly on this legislation, as it does provide an interesting alternative to

the production of electricity in this Province. I want to inject a note of

caution and make some remarks that I hope the minister, in his closing remarks

at this stage of the proceedings will refer to.

I do welcome an opportunity - and I guess this legislation

could be called 'permissive'. It would allow a private developer, or allow

Newfoundland and Labrador Hydro, to engage in mini-hydro projects - I don't know

how 'mini' fifteen megawatts might be - but in a small hydro project that would

not be subject to the same rigour that the Public Utilities Act would subject an

enterprise to.

I see that as a positive thing, at least to provide that

alternative there. Because one has to recognise that electricity generation on a

small scale is not the same kind of enterprise as you would see on a large scale

where you have long-term capital, where you have access to the major capital

markets, where you have the expertise and financial vehicles available to you

that a small enterprise operation might obtain in the markets of today.

I do have to say that I have a couple of concerns that this

might open the door to a wholesale utilisation of hydro sites in this Province

which, coincidentally, are often very important environmental and wilderness

sites that need to be protected. Mr. Speaker, we, in this world we live in, are

constantly making choices. If we choose to catch fish by trawlers in a certain

method of fishing, then we are eliminating another type of fishery on the

inshore. I think the Member for Baie Verte - White Bay knows that full well. If

we choose to engage in a small site hydro development in an area that is a

wilderness area, that is used as a resource for wilderness use, for recreation,

for tourism, for the enjoyment of its beauty - such as Paradise River, which is

recently developed - then we are making a choice to eliminate that from the

other uses, by using it for hydro.

So we have to be very careful that we are not just opening

the door and saying: Come on in, make use of whatever is left, and eliminate the

other choices, because there are other choices. There are other choices

available to Newfoundland and Labrador Hydro and to the other major power

generator in this Province, Newfoundland Light. Now, there is a concept which I

am sure the Minister of Mines and Energy is familiar with, which can be

implemented on a very important scale to eliminate the need for further

generation.

This is the concept of demand management. It has been used

quite successfully in some cases in other provinces, and also in states of the

United States, in a very effective way. Let me give you an example. The concept

of demand management and the economics of it relates to, what are you spending?

What is the capital cost of the next megawatt of power that your system is going

to generate? What is the next source? If the next source of energy, Mr. Speaker,

is the Lower Churchill, what is the capital cost per megawatt for that project?

If the next choice happens to be the Lower Churchill, what is the cost of that

per megawatt; not, what is your average cost on the system right now, but what

is the cost of the next megawatt, because that is what you have to decide. If a

utility is deciding to engage in a new generating capacity they have to decide

what is that capital cost for the additional megawatts of power that they are

adding. When they do that, of course they are making a decision to use their

capital in that way.

The demand management concept, Mr. Speaker, is one where the

alternatives are considered. So if a program undertaken by Newfoundland and

Labrador Hydro, in this case, can spend a certain amount of money and can,

through that program, reduce the demand for power by an equivalent amount of

megawatts, one megawatt, two megawatts or ten, there is a cost associated with

that. Mr. Speaker, lo and behold, when the proper economics are applied to this,

it turns out that demand management, up to a certain point, is a very effective

and much cheaper way of controlling the cost of new generating capacity and

keeping the cost to consumers down, avoiding alternatives such as coal-fired or

oil-fired generation, avoiding the alternatives of nuclear power with all the

problems that are associated with it. Mr. Speaker, it is a way to conserve

energy, to save money, and to keep the cost of electricity down. So, Mr.

Speaker, instead of going out and generating an additional ten, twenty, thirty

or fifty megawatts of power, the system is able to save fifty megawatts of power

by introducing that type of program.

This has resulted, Mr. Speaker, in some cases, with a power

company actually going out and buying energy-efficient light bulbs, for example,

and giving them away. It sounds stupid, Mr. Speaker, but it has been proven in

certain circumstances that the buying of energy-efficient light bulbs and giving

them away by a power company actually saves that power company money. That is

not in a public utility, Mr. Speaker, where it is publicly owned, that has been

done in North America by private utilities because they know that they are

saving money by doing that. So, Mr. Speaker, those kinds of concepts have to be

considered. They have to be taken very seriously.

I know that Ontario Hydro - and it is not, Mr. Speaker, for

those on the opposite side who would like to criticize the current Government of

Ontario, it is not through their initiative, although they are very supportive

of it -but Ontario Hydro has, since the last administration, been undertaking a

major project in the area of demand management spending a considerable amount of

resources between now and the year 2000 to decrease its cost, the required

capital cost in the future, by providing power through demand management as

opposed to new power generation.

Mr. Speaker, while I welcome the legislation that is

providing a new alternate way for private developers to get involved in hydro

generation, I have that concern, the concern of the environment, that as it

happened in the past, proper environmental assessments have been waived by this

government and I am afraid they may be waived again in the interest of somebody

having to invest some money into the economy without doing a proper assessment

of the alternative uses or without properly setting aside, for wilderness uses

in this Province, a sufficient amount of land and particular resources. So I am

concerned about that.

I am concerned that maybe hydro development might take place

where it is not necessary. I am concerned that sufficient attention will not be

paid to the alternatives to demand management by allowing this alternative here.

I have another concern, and perhaps the minister can address

this because this is, as I said, a permissive piece of legislation does not

really require anything. It just allows a public utility to engage in a contract

with a private hydro developer without having to have that contract approved by

the Public Utilities Board. If I have misstated the purpose of this legislation,

the minister I am sure can correct me in his closing remarks. But as I see it,

all this does is permit a private contract to exist without the Public Utilities

Board having a look at it on behalf of the public. That is what it permits. Now

I am not totally opposed to that, but I see the implications of it as being

fairly open-ended and in the control of Newfoundland and Labrador Hydro without

necessarily having the right amount of public input.

One of the issues that arose in our sister province next

door, the Province of Nova Scotia, was that private hydro developers were being

discouraged by the major utility in Nova Scotia, Nova Scotia Power, and they

were being discouraged from developing alternate hydro sites, I think it was, or

wind generation or other alternatives. The reason they were being discouraged

was because Nova Scotia Power did not want them in the business. One of the ways

that they discouraged them was by pricing. What they did was they said, well we

will buy power from you, yes of course, when we need it. When we need it we will

buy power from you, but we will not guarantee you any purchase. Secondly they

said, we will buy power from you, but we will only buy power from you at our

average cost. If our average cost happens to be, in the case of Newfoundland and

Labrador Hydro, the sitting facility at Bay d'Espoir, if that was part of their

average cost, and if their average cost includes other facilities that perhaps

have been paid for, then their average cost is going to be far, far lower than

the cost of new generation.

There has to be a balance achieved there between the cost of

new generation of electricity as a means of making a new project viable for

people other than Newfoundland and Labrador Hydro who have access to the capital

markets. The pricing policies have to be consistent with really allowing

alternative energy sources to be developed. They may not be hydro. This is a

bill for hydro. There may be alternative energy sources that might be available.

We see, and I suppose it is pretty expensive and has been looked at only

experimentally in this Province, but when we see on television the fields and

fields of the wind generation farms in Arizona and other places in the United

States where they do not have hydro-electric power, but they seem to have some

wind. I know that one thing that we do possess in abundance in this Province on

every coastline and everywhere else, is wind. There may be other alternative

energy sources that can be explored and encouraged if the pricing is addressed

as well as just the availability of alternate energy sources.

AN HON. MEMBER: (Inaudible).

MR. HARRIS: It has been suggested, Mr. Speaker, by the

Member for Humber Valley that a wind generator in this House might prove to be

very viable indeed.

So there are other alternative energy sources that can be

explored, and ought to be encouraged by legislative policy as well as government

initiative. I see this as a start only. It is a start only in opening the door.

I hope it has not opened it too wide in terms of the very few hydro sites that

are available yet in this Province, but I hope that the minister will also

consider legislation that will ensure that the pricing policies that are engaged

in by Newfoundland and Labrador Hydro in dealing with these new energy sources,

or alternate energy sources, will provide for or will ensure that viable

alternatives can be produced by the private, and perhaps by the semi-private or

the public sector community development corporation type alternatives as well as

somebody with private capital.

Mr. Speaker, I support the legislation, because it allows the

development of alternatives, but I would ask the minister to address these

remarks in his closing comments to see what other plans the government may have

in this area to encourage alternatives and to prevent perhaps the waste of

energy by not fully addressing all the potential of demand management before

looking at new generation sources.

Thank you, Mr. Speaker.

MR. SPEAKER: The hon. the Minister of Mines and Energy.

If the minister speaks now he closes the debate.

The hon. the Minister of Mines and Energy.

DR. GIBBONS: Thank you, Mr. Speaker.

Mr. Speaker, I appreciate the comments of my two hon.

colleagues. I will speak a little bit about the Hydro sites. To date,

Newfoundland and Labrador Hydro has assigned rights for a total of 150

megawatts, approximately thirty rivers to private developers who are interested

in assessing them. Some of these have already gone through the environmental

assessment process as was indicated by my hon. colleague from Humber Valley.

Some of the others are part way through that process, all the money being spent

being private money by these companies, and I would expect that over the next

few months there will be some more registered.

Hydro's plan is to call bids in the very near future for

fifty megawatts, and they are interested in taking the least cost fifty that may

get bid. So maybe we will get 150 megawatts or more that gets bid in response to

this call for proposals and they will take the cheapest amount, the first fifty

probably at the best price.

With regard to some of the concerns of my hon. colleague from

St. John's East on demand management, well we are already into that business in

a fairly extensive way but there is probably room for us to get into it in a

bigger way through our two public utilities.

Recently we approved a ten year strategic plan for energy

efficiency in alternate energy sources put together by an advisory committee

that included representation from both of our public utilities as well as from

all of the user groups. One of the key parts of that is demand management. The

Power Smart Program that is now being promoted by both Newfoundland Power and by

Newfoundland Hydro is a demand management mechanism. So we are not going to lose

sight of that. Every kilowatt saved is equivalent to a kilowatt produced, and it

is often much cheaper to save a kilowatt than to produce a kilowatt.

In terms of the mention of their concern about pricing and

how the price will be set, Hydro is not looking at the average cost to them in

setting their price, but they are looking at their avoided cost. The cost for

Hydro for new generation in the future for new sources, not for saved energy,

would be something like Holyrood number four or some other Hydro development

somewhere, and they are doing their pricing based on their avoided cost. That is

quite a considerable amount higher than the average cost of their power at this

time. So I believe that price should be within the range that is acceptable and

will make these small hydro possibilities quite viable.

With regard to the comments about this making everything wide

open for destruction of wilderness rivers and so on, I think that is adequately

covered in the environmental assessment process. Any time there is a great

concern expressed, whether it is with regard to the fishery or some other

matter, that will be covered in the environmental assessment process. Where

there is no concern with regard to that type of issue, a site can get through

the EIS process very quickly, otherwise it might take longer. As a matter of

fact, and I have said this before in other areas, for some cases there can be

considerable enhancement here of the fishery related to some of the rivers,

considerable enhancement of the salmon in particular and the trout. That is

being addressed by the proponents in some cases where there is a concern.

Ladies and gentlemen, I do not think I have anything further

to say. I believe I have covered the concerns that were raised, and I am pleased

to move second reading.

SOME HON. MEMBERS: Hear, hear!

On motion, a bill, "An Act To Amend the Public Utilities Act,

1989," read a second time, ordered referred to a Committee of the Whole House on

tomorrow. (Bill No. 18).

MR. BAKER: Motion 1, Mr. Speaker.

MR. SPEAKER: Motion 1, the adjourned Budget.

The hon. the Member for Fogo.

MR. WINSOR: Thank you, Mr. Speaker. I thought it was Bill

17 that we were going to have addressed today, but I guess the President of

Treasury Board - after the scalding that he took this morning with the unions -

did not have the nerve to introduce the bill into the legislature this

afternoon.

Mr. Speaker, I have a few words to say. The Minister of

Finance rose in his place today to answer a question. I was not quite sure if I

got what the minister said with respect to the tax on fishermen who sold fish to

a fish plant. It is my understanding you said that would not be included in the

payroll of that particular fish plant unless the plant happened to own the boat,

I would assume, and then it would be the property of, for example, FPI or a

plant that had a fleet of trawlers, then the payroll would be a part of the

plant's payroll in that case.

DR. KITCHEN: Fishermen on the trawler are part of the

payroll.

MR. WINSOR: Yes, okay. But the minister seemed to

indicate that no plants would pay that much? I did some quick calculations -

DR. KITCHEN: Only two will pay $50,000 or more.

MR. WINSOR: Only two would pay. Wouldn't it be quite

common in this Province for a plant, and when I say a plant, quite often we have

plants with (inaudible).

DR. KITCHEN: I should say a company.

MR. WINSOR: A company, so -

DR. KITCHEN: A company, that is even more so because they

are totalled. If you are a company that has five fish plants, even if they are

operating under different company names, they are put together and you get one

deduction of $100,000 and there are only two of these conglomerations or

whatever you call them that will pay $50,000 in payroll tax.

MR. WINSOR: So the minister is saying that there are no

fish plants in this Province that would have payrolls of $5 million?

DR. KITCHEN: No more than two.

MR. WINSOR: No more than two.

DR. KITCHEN: Yes.

MR. WINSOR: Mr. Speaker, I find that hard to believe,

that would only -

DR. KITCHEN: So did I.

MR. WINSOR: A plant that would have 600 people on their

payroll is quite common - Beothic Fish, Quinlan's and a variety of them around

the Province would have at least 600 seasonal employees and if they paid $8,000

a year to each person, that would make $4.8 million, added to that is the

seasonal staff who are on all the time and make much more than $8,000 a year. It

would seem quite unusual that the one plant which happened to contact me did

have a payroll of $5 million and will pay $50,000, a difference, as I told the

minister yesterday of - I think they paid $17,000 last year, this year they will

end up paying $58,500 because of the $8,500 they have already paid, and then it

is going to be $50,000 on payroll because it is a seasonal plant, the bulk of

their payroll, all coming from, as all the seasonal plants in this Province are,

they are all from June onward basically, so anything that is paid prior to that

on the assessed value is still going to be charged against them because the bulk

of their payroll is not going to start until June 30 whenever it kicks in, July

1, and that will be the bulk of their payroll. I am sure there are others, I

would think that the Co-op in Fogo Island is getting close to that number of

employees with their crab operation as well. Mr. Speaker, I will do some further

checking, but I would be quite surprised if there are only two fish plants if we

include NatSea and FPI, there would have to be more than that.

Mr. Speaker, I think the minister should check his facts

again. I would like to ask the minister another question then, because some

boats themselves, especially the bigger long-liners or otter trawlers or some of

the shrimp trawlers, instead of having fishermen who share the enterprise, one

individual owns it and then he pays a proportion of catch, like he is an

employer, would he be subject to the payroll tax? There are a number of them

with set up companies.

DR. KITCHEN: The bottom line is what they put on the T-4

slip.

MR. WINSOR: Okay, in that case, if it is an enterprise

set up as a company who pays the fishermen who work on their boat a wage, then

they would be included as a company and would be subject to payroll tax?

DR. KITCHEN: Yes.

MR. WINSOR: Alright, that is fair enough, if I understand

the minister correctly. I also want to -

AN HON. MEMBER: It is not fair.

MR. WINSOR: It is not fair. I do not think it is fair,

Mr. Speaker, to attack fish plants at a time when they are perhaps most

vulnerable. Most of them as the minister knows had quite a difficult time in the

past three or four years in making ends meet, and instead of taking away from

them, we should be offering them some incentive. I happen to look through a

government guaranteed loan bill the other day and it was interesting to note

that a fair number of fish companies in this Province have guaranteed loans with

the government and government has had to continue to guarantee the loans and I

think we asked the other day - sought permission from this Legislature to

continue the Guarantee Loan Program for some plant operations in this Province.

I wonder how they are going to meet their financial obligations now, with the

government taking more dollars out of their pockets. Mr. Speaker, I think it is

a regressive step. The chairman of Abitibi-Price in Grand Falls, I am sure my

friend from Windsor - Buchans, heard the statement from the President of the

Company the other day, when he talked at great length about the potential damage

it could do to the forest and pulp and paper operations in central Newfoundland

as a result of this disincentive for business to stay here. Mr. Speaker, I think

it was very regrettable, and a regressive tax. The minister should re-examine it

to find if there is some alternate measures that can be approved without

attacking the few vulnerable resource based industries that are around in the

Province.

When the minister read his Budget the other day he projected

that the UI rate, on page 4, in Table 1 of his Budget, he says the UI rate as a

percentage is going to increase from 18.4 per cent to 20.4 per cent. That in

itself is bad news. What is even worse is to turn to the estimates and see what

the Department of Employment and Labour Relations have in their budget to offset

the problems that we have encountered in the economy of this Province.

In the estimates on page 190 we go through all the programs

that the minister had in place. The minister confirmed yesterday that the

employment generation program had $3.1 million allocated to it, but that is not

going to create new jobs. That is a continuation for about half of them, of jobs

that are already there. So of that $3.1 million, $1.5 million roughly is all

that is going to go into the creation of new jobs. So that is going to do

precious little to combat an unemployment rate of 20.4 per cent. One point five

million dollars, that is all the new dollars that he found in his employment

generation program. If you look through the other divisions last year in the

minister's emergency response we see no allocations at this point in time in any

of them for anything in any substantive way to prepare this Province for the

difficult, bleak summer that is ahead.

I hate to be a doom and gloom speaker, and certainly

pessimistic, but I read an account in the paper yesterday of where some

fishermen from the St. John's area fished quite extensively for the past three

or four weeks. I do not think they caught enough fish to have a meal. They said

the only resource that they could bring back from the ocean I think was $1,700

worth of seals. If the minister, being aware that the situation is so bleak, the

prognosis for the summer in the fishery, I cannot for the life of me see why the

minister did not immediately initiate some program that would do something to

stimulate the economic sector of this Province.

When we look down through his budget we see the only program

that had any substantive increase in it was the graduate employment program that

increased by some $1 million. Everything else was reductions and decreases. Is

that any way to attack the 20.4 per cent unemployment rate in this Province?

The person who will find out quite quickly the impact of that

depressed economy is the Minister of Social Services. The Minister of Social

Services in the past four or five months has seen a caseload increase I think

from 63,000 to 68,000, and still increasing, as the minister is well aware. That

never before. When I talk to social workers throughout the district that I

represent they say they have never seen as many people. People they have not

seen in fifteen and twenty years are coming in to seek social assistance. People

in fact they had never seen have this year had to come seeking assistance.

The real tragedy in all of that, besides these people having

been forced to resort to Social Services, is what it does to the overall economy

when they do not work. The local businessman no longer can sell his services,

his products. The ripple effect continues on down through the economy. What this

government has failed to realise is that its own image that it projects of how

bad the Province is makes people do anything but spend. There has been no frame

set where people can go out and spend any money. Everyone you talk to is afraid

he will be next to be laid off. That kind of attitude is out there, and hon.

members opposite know that people are very pessimistic. There is a very gloomy

atmosphere out there and they are afraid to spend money, and it can do nothing

to stimulate the economy. If this Budget should have done anything, it should

have made a major attack on the economy. Now, by an attack, I mean doing

something to solve that economic malaise out there.

Mr. Speaker, I am going to give the government credit for

doing something. Last fall when there was an emergency response program of $13

million - the Minister of Employment and Labour Relations might know the exact

amount, I think it was $13 million. You talk to the local businesses in rural

Newfoundland and they will tell you that during that period of time, they had

their best sales for the summer, that period of time when you put $13 million

into the local economy. Mr. Speaker, on a $3.5 billion Budget, $13 million is

not very much, not very much at all. In fact the Minister of Employment and

Labour Relations knows, I told him so, that the only time there has been any

little change in the UI stats in this Province was when he had a program in

place last fall that employed thousands of people. He got up in the House and

boasted about the number of people the program employed, and rightfully so,

because it was a good program.

Now, if it was good, the question has to be asked, why was it

scrapped now? Why is there nothing in this Budget to do the same thing this

spring, this summer and this fall as was done last fall? This Budget does

nothing to stimulate employment. I looked at the estimates for the fishery and

when I turned to the last sheet I was quite pleasantly surprised to see that in

fisheries we have increased the Budget from $25 million last year to $27

million, a $2 million increase. I thought it was good news until I went through

the estimates and found that of that $27 million $7.6 million is going for the

buy-out of the salmon licenses, which means that the Budget is really, if you

look at actual dollars that are going to be spent in the fishery, only going to

be $20 million, some $3 million less than was budgeted last year. We actually

spent some $5 million less than was budgeted.

AN HON. MEMBER: (Inaudible).

MR. WINSOR: That is good.

Mr. Speaker, what we find here is that the area where we

could look at some value added, some secondary processing, that is not going to

be spent. All we are doing is giving $7.6 million to the salmon fishermen of the

Province as a compensation for the lost revenue they would have normally accrued

in the salmon fishery. I was quite surprised to see that had occurred. Then, if

you look into the different categories in the department, in marketing, in

market development, in aquaculture - in fisheries and aquaculture development

last year, we spent $7.5 million and this year it has been reduced to $5.2

million. There is over a $2 million reduction in an area where if we ever need

market development, if we ever need money being spent it should have been there.

I am sure the Member for Baie Verte - White Bay could tell you of the great need

for us to do some marketing.

AN HON. MEMBER: (Inaudible).

MR. WINSOR: Yes, Mr. Speaker, I tell you there was

something written about it. The $59.5 million for capital works for water and

sewer in this Province was a good move, a good initiative.

AN HON. MEMBER: That is not a part of the Budget.

MR. WINSOR: It is not a part of the Budget but it was

announced in the Budget. That was one of the items of good news in the Budget,

the $25.5 million for road construction that has been announced since, that was

a good announcement except that we would like to have seen twice as much. If he

is wondering if there is any good news in the Budget I am hard pressed to find

it, Mr. Speaker. The Minister of Social Services was able to find 2.2 per cent

for social service recipients. What it does not say in the Budget, and I hope it

was kept in place as I was going to ask the minister, was the $50 a month during

the winter months for fuel allowance. Is that still there? What is that? It is

gone? Is that gone?

AN HON. MEMBER: No, it is gone.

MR. WINSOR: It is not there. You can't tell if it is

there.

AN HON. MEMBER: You wouldn't believe it, anyway.

MR. WINSOR: Well, certainly I will believe it. Yes, I

will believe it. The fifty dollars a month given for the six months for fuel

adjustment during the winter months was announced in last year's Budget as a

special feature. Now, there is no indication if it is there or if it is gone. We

will assume it is there. The Minister of Social Services didn't say anything but

the former minister, who prepared the document, I am sure if he says it is

there, we will believe him.

MR. HOGAN: (Inaudible) say it was there.

MR. WINSOR: Oh, no! The minister said it was there.

Now, Mr. Speaker, the Minister of Municipal and Provincial

Affairs wants to take

part in the debate. Under the

section of Capital Works in

Community and Sports Facilities, Mr. Speaker, he has reduced his budget from

$2.2 million to $1.5 million. Mr. Speaker, that is a small portion of money, but

it gives municipalities in this Province -

MR. HOGAN: (Inaudible).

MR. WINSOR: Mr. Speaker, if the Minister of Municipal and

Provincial Affairs wants to take

part in the debate I think he should get in his

place, and I will certainly allow him to ask a question. Otherwise, he can keep

his interjections awhile and then he can take his place.

Now, Mr. Speaker, what I want to ask the minister is: Last

fall, the former minister had a part of the make-work program that was in place,

a little more substantive budget than that. In addition to that, recreation -

MR. HOGAN: Didn't you (inaudible)?

MR. WINSOR: I didn't get it yet, no.

Mr. Speaker, the minister has reduced this very worthwhile

program by some $700,000. Now, Mr. Speaker, the minister, a former councillor

himself, a former mayor, knows how much that was appreciated in small

communities, when you got $5,000, $6,000 or $8,000 as a grant to work on your

ball field or soccer pitch.

MR. HOGAN: (Inaudible) out, the middle of the road.

MR. WINSOR: The minister might think that but, if that is

the case, if the minister knows so much about it, I ask the minister, why did he

find it necessary to reduce that small amount of money, some $2.2 million, down

to $1.5 million when the demand for recreational facilities exceeds every year

the budget that the minister has. The demand far outstrips it and yet the

minister chose not to include any new monies in his department. I would like to

ask the minister why he did that.

DR. KITCHEN: It wasn't there to put there.

MR. WINSOR: It wasn't there to put there. The minister

had no money is what he is suggesting.

AN HON. MEMBER: It wasn't a priority.

MR. WINSOR: It wasn't a priority.

Now, Mr. Speaker, to get back to some things as they affect

the district.

MR. HOGAN: Give back the money from Fogo that was

(inaudible).

MR. WINSOR: No, I won't give back the money. In fact, I

am just going to ask the Minister of Works, Services and Transportation for some

more money because the residents of Fogo Island and Change Islands too, Mr.

Speaker -

MR. HOGAN: You agreed it was all right to reduce the

recreation money.

MR. WINSOR: No, I didn't agree to reduce the recreation

money.

MR. FLIGHT: What about (inaudible) Zamboni?

MR. WINSOR: I am going to address that in a second, I

tell the member for Windsor - Buchans.

Mr. Speaker, I want to address the question of the Fogo

Island ferry, that boat that has served the island.

MR. WALSH: Fix up the Hamilton Sound.

MR. WINSOR: Mr. Speaker, we should take the Hamilton

Sound and drop it on the head of the Member for Mount Scio - I won't say for

what reason.

Mr. Speaker, the Beaumont Hamel: The 1991 Budget said that

construction of that boat had been deferred for one year. Now, Mr. Speaker, we

find in this budget no mention of plans to proceed with the construction of the

ferry. I have heard the Premier, Mr. Speaker, lecture the other premiers of

Canada, the Prime Minister, and people in this Legislature about what the

federal government should do to kick-start the economy, as the Premier likes to

say. One of the things he said that we should do is we should get on with

capital works expenditures today that we are going to have to do tomorrow or the

next day.

Mr. Speaker, that is a pretty good idea. That is an excellent

idea, except that he failed to apply it to the Province, because officials in

the Department of Works, Services and Transportation, have advised that the

present boat that serves both Fogo Island and Change Island is not capable of

navigating the winter run without the assistance of an icebreaker. As a matter

of fact, an icebreaker, as the people from Fogo Island say, has to baby-sit it

from January up until the end of March.

AN HON. MEMBER: (Inaudible).

MR. WINSOR: From January until the end of March.

MR. DUMARESQUE: We don't even have one from January to

May.

MR. WINSOR: I have all the sympathy in the world for the

Member for Eagle River. And the Member for Mount Scio - Bell Island in the last

two or three years has experienced some ice conditions, not as bad this year as

it was in the year previous, but we still might get it yet - the ice - the

northern ice. The Arctic ice still might find its way in along the shore and

create the same kinds of problems this spring as happened last year.

To get back to what the Premier had said, there is a ready

recognition everywhere in this Province that we have economic difficulties, but

the very thing he suggested Ottawa should do - when we said he should get on

with constructing the roads across the country; build the Trans-Labrador

Highway. You are going to do it anyway. It is money that you are going to commit

within the next number of years. Now I say to the Premier, why could he not have

done the same thing for the Fogo Island ferry? Why could he not say, we have got

to build that boat, no matter how we cut it, down the road, one, two, three

years time we are going to have to have a replacement; and if the day should

ever come when the federal government is unable to provide icebreaker

assistance, it will be very similar on Fogo Island, as the Member for Eagle

River suggested, there will be no boat operations during the winter months.

That is not what this government promised in 1989. Upon their

election in 1989 they said they were going to make transportation to the islands

by ferry the same as by car. Subsequently, they started to reduce the amounts

charged to users. They did that. But if there is not an adequate service, if it

were free, and the Member for Eagle River can appreciate this - if it were free,

if the Puddisters, or whoever runs the thing said, 'It's free transportation

during the months of January, February and March,' then there is not one person

in the member's district who can use it.

AN HON. MEMBER: (Inaudible) Zamboni.

MR. WINSOR: Mr. Speaker, if the Member for Grand Falls -

I could talk about the moose.

MR. FLIGHT: Two ministers want to know about the Zamboni.

MR. WINSOR: Two members want to know about - yes, I can

address a few minutes, Mr. Speaker.

I would like to ask the minister another question then, since

you have reminded me. I noticed last spring - I think it was last spring. I am

not sure of the time - maybe last fall, the former minister, the present

Minister of Social Services, made a pilgrimage across the Province, starting in

Port aux Basques. He announced, I think, a swimming pool for Port aux Basques.

Then he came on to Stephenville and announced another one, and on to Port au

Choix and announced another one. Then I think he made a stop in Bishop's Falls

and that area and announced another one. Grand Falls I think is where he had his

press conference. He went on to Harbour Breton and announced another one. Then,

finally, in the Bonavista North area he announced the last of his six

recreational complexes that were going to be built to the tune of $9 million.

When I look through the documents, and one entitled 'The

Economy', I notice that only four of the six that the minister had announced

show up. Two are missing. Perhaps the minister can tell what happened to the

other two. Is that money still available? Because if that money is still

available, I have a -

MR. SPEAKER: Order, please!

The hon. member's time is up.

MR. WINSOR: By leave?

AN HON. MEMBER: (Inaudible) Queen's Printer.

MR. WINSOR: Mistake in the Queen's Printer, is that it?

MR. SPEAKER: Order, please!

The hon. the Member for LaPoile.

MR. RAMSAY: Thank you, Mr. Speaker.

With the Budget as the topic for discussion under this part

which we are discussing here now, it gives it a lot of leeway, I suppose, in

what we can speak about. There are a lot of different items.

I note in Appendix A of the Budget document, itself, some of

the detailed analysis of what is available under the different headings. Going

down through some of these, of course, I note first the Department of

Development. It says: "Funding for Enterprise Newfoundland and Labrador

Corporation and the Economic Recovery Commission has grown in response to

increased emphasis on economic development."

Now, I have often been spoken to by the hon. Member for Burin

- Placentia West insofar as a fabrication yard for Port aux Basques was

concerned. He would often mention this. I was pleased to be involved on Friday

in a press conference announcing the Atlantic Seaboard Industries Limited

fabrication yard facility for Port aux Basques. I was quite pleased to have been

involved in the approval of the project.

MR. TOBIN: May I ask you a question?

MR. RAMSAY: Go right to it.

MR. TOBIN: How much money is the provincial government

putting into the fabrication yard?

MR. RAMSAY: The provincial government is participating by

way of a loan to the company. The figure, I think, is $2.6 million. Then ACOA is

in for a similar amount. Private funds make up the balance of the capital costs

of the facility.

MR. TOBIN: ACOA is in there for over $2 million and the

Province is providing over $2 million in loan guarantees.

MR. RAMSAY: Yes, exactly, that is the way it works. Also,

the railway diversification money is involved in the set-up, as well. It has

been listed by ACOA. The figure seems a little bit large. But they signify a

total of $17.6 million overall. This will include the working capital

arrangements made by the company through their own private arrangements with

banks, fund lending institutions and what have you, for the private capital

required to do projects and whatnot that will be done at the facility.

Just a little bit about Atlantic Seaboard Industries Limited,

Mr. Speaker. I wanted to get it on the record. I have had a lot of involvement

with this company as they submitted their business plan to both levels of

government last April 30. The business plan was brought in and an evaluation was

done by the government departments concerned and by Enterprise Newfoundland. The

evaluation was done and it does have some good prospects for the future beyond

Hibernia, as well. It will target some Hibernia-related work as a part of its

initial start-up, but also, it will target some other areas. I note the defence

industry is one area, in particular, where Newfoundland has never done the

amount of work that it was entitled to do because the capability just was not

here. The high quality welding standards, the high quality standards of

construction that are required to do defence-related contracting, this expertise

has just not been available.

So with the company involved, the Norwegian partners of the

company were brought in. They, of course, have the expertise to bring to Port

aux Basques, to share, and bring forward the training necessary to bring the

skill levels of our people up to the standard required, also then, to enable us

to bid on things in the future with our local people involved.

Now, the companies involved, the foreign partners - one is

called Vindholmen Services of Arendal, Norway, and they are a very strong

company. They have a very solid reputation in the offshore industry. I note some

projects here that I have a list of that they have been involved in in the past.

The company has been involved in construction of oil rigs, steel decks, process

modules. It goes on and on, and really a lot of different oil projects over the

years. This is the kind of expertise and engineering experience they will bring

to the small town of Port aux Basques and establish their engineering and design

services out of there and hopefully be able to tap into that market, as well as

many others.

I note environmental concerns brought in through the

initiatives of people throughout the world now that highlight the requirements

of improving the pollution control situation as it relates to pulp and paper

mills and other industries. This is a wide open market for people with the

expertise and capability to construct these environmental components that are

required, the components that will clean up the effluent and also the smoke

stack pollution control devices, etc. So this is another target market that will

be looked at for Port aux Basques.

I note that the company has also affiliated with another

corporation out of Norway called Andersens Mechanical Works, or in Norwegian,

Mek Verksted is the name. They are a drilling manufacturer for a mining drilling

and that sort of thing. Now they, of course, will have a different area of

expertise for boring of underground tunnelling, maybe some of the things that

would be required should we manage to get a go-ahead on the Lower Churchill

development. This is the kind of thing they see as a possible opportunity for

their expertise and involvement.

The company also has a number of products that will be

brought to Newfoundland by technology transfer arrangements with the Government

of Canada's Technology Transfer program. These products will be licensed to be

produced here in Newfoundland. One is an environmental product called a clear

water separator, and I have a small brochure here if any hon. members want to

have a look at it. It is a unit which separates water that comes out of the

bilge tanks of large ships and oil rigs and so on into drinking water. It will

bring it down to the level of potable drinking water, and that, in itself, as an

environmental product I think, Mr. Speaker, would have a very solid future with

a lot of concerns over the oil tankers and other ships that pass by Newfoundland

frequently and dump their dirty bilge water into our ocean area, thus affecting

the wildlife and the fish off our coast. This is a concern that sort of hits

home, and the North American market for this product will be served by

manufacturing the product in Port aux Basques.

As far as the Hibernia project goes and its involvement in

that, the company has pre-qualified to bid on some Hibernia-related components,

and will be submitting its bids and working on this over the next number of

months. Now, again, the company has full confidence that the Hibernia project

will proceed, and they have invested their own private funds, along with the

investment by the respective governments, and are going full speed ahead.

Hopefully, this will be an indication to other businesses in the Province that

some people are, indeed, interested in making investments here in the Province,

in spite of the current economic climate with fear of the problems with finding

a new investor for the Hibernia project.

We have here a multi-national consortium that are very eager

to get involved in the project, and they are willing to spend money and

establish themselves here to be prepared to take advantage of the contracts and

the work that will come out of the Hibernia project. So I think it is a very

positive sign that they have decided to proceed. It will certainly lend a

certain element of credibility to the feeling and the optimism in some sectors

of the Province stating that people feel Hibernia is far from dead, and that it

will certainly go ahead.

To get into a little more detail on the Budget I would like

to look at the Enterprise Newfoundland budget. I think some $27 million this

year has been dedicated to the fund that is established to allow for business

related loans and initiatives that are done through Enterprise Newfoundland.

This will help stimulate small business here in the Province to help build an

entrepreneurial economy. People who are having difficulty with a variety of

problems with the fishery, and some people in forestry and what have you, if

they take their own ideas and bring them to Enterprise Newfoundland they are met

with open arms and given assistance in the planning of their business. They are

given assistance in seeing if their idea has anything that they can help

research to see if there is a way they could change their business plan to

effectively go out and start their own job - to create their own job. This is

far and away different from the culture of the past. There were only a few

people one time in Newfoundland, Mr. Speaker, we often refer to as the

'merchants' - the 'merchant society'. The people were looked at as either the

fishermen or the merchants. Now people who are having a difficult time would

have an opportunity, through regular lending institutions, but more so I think

through the help and assistance that can be provided by an initiative like

Enterprise Newfoundland that is distributed through its regional offices

throughout the Province.

There are some other points of note in the Budget that I

would also like to speak about, one of which is the changing of the school tax.

The opposition seems hell-bent on wanting to make sure that it is seen as a

terrible thing; that the elimination of the school tax is a fallacy, or it is

another piece of selective verbosity by the government. Really, we didn't do

anything, they say, but it is just the wording - the way we have worded it that

we have actually done something. Well I think that the person who scraped by

with maybe $10,000 to $15,000 in income in rural Newfoundland by participating

in the fishing industry, by logging in some areas of the Province, or just

through no fault of their own have had a year with very low income will be able

to look at this and say, the elimination of the school tax is good. They won't

pay as much as they paid in the past, and this is the kind of initiative that

will make those who can afford to pay, pay more. Granted, everyone in this

chamber I am sure may end up paying more because of this, so maybe this is one

of the reasons why the opposition are interested in criticizing the changing of

the school tax, and would prefer to pay eighty-five to $150.

The other initiative which I wanted to mention is, along with

the school tax there is a point that refers to the changing of the school

capital budget from $27 million down to I think it is $20 million after a three

year commitment of $27 million. They said, why would you want to do that? You

are lowering school construction. You are doing something bad for education, but

the reality of it is that this is not doing something bad for education. This

is, in effect, the beginning of a long-term planning process for capital

expenditures in the Department of Education. If we decide to plan this out -

okay we will bring it down to the previous level of $20 million after committing

an extra $21 million over the last three years, just in order to get a ground

floor amount that we will begin with and plan for the long-term future. That is

one aspect of our planning - planning that has been, in the past, shoved to one

side for the sake of ad hoc political expediency that the opposition often

subscribed to, and I would say more often than not subscribed to this political

expediency in their budgeting - the process that they followed.

When the money was flowing in from Ottawa, and when the tax

revenues through the growth cycles that were very evident in the economy of the

1980s, the government opposite chose to grow along with it; they did not decide

to lower the debt, they did not decide to take the initiative that would be

required in planning the future, the choice was one of spend, spend, spend for

political expediency and it is that kind of situation, Mr. Speaker, that has put

us into the current economic situation we are in where we now have to take some

very drastic measures.

The drastic measures which were begun last year and continued

into this year of a wage freeze as one example, which is very difficult I am

sure for a lot of MHAs, regardless, those who participate here in democracy in

this Chamber, I am sure all have some aversion to a wage freeze philosophically,

but the point is, it is tough medicine for tough times; it is a problem that we

have where we cannot always use our credit card to pay our light bill. We cannot

always use a current account deficit on which to run the Province, therefore, we

have to lower the current account deficit that has been experienced and brought

it down from $59 million last year to hopefully, keeping it below $30 million

this year.

Now that is the kind of initiative that will secure the

fiscal integrity of this Province. It is the kind of initiative that will

hopefully, sometime soon, possibly see us being able to have our credit rating

improved and therefore lower our overall cost of borrowing. I had a discussion

with some officials from the Department of Finance when we were doing the Budget

lockup process and I asked one of them if the fishery situation had not eroded

as it did, was there any consideration given to the fact that because of solid

fiscal management of this government, may we very well see a possible increase

in our credit rating? His analysis was that of course, given the unforseen

circumstances, that there was a possibility that our credit rating could be

certainly considered to be upgraded by some of the bond rating agencies, so this

essentially will dictate to you that the job we have been doing of managing the

Province's economy through the able efforts of the Minister of Finance, has

certainly had some effect, we are seen as being very much taking a leadership

role as far as managing Provincial economy here, relative to other provinces

throughout the country.

We have taken the initiative, we took the bad medicine last

year, we are continuing this year and we have, through the corrections made to

bring about a more efficient public service, lowering the numbers and

re-organizing the health care system, so that we could allow for a lower budget

deficit this year, is certainly the kind of situation, Mr. Speaker, that sends a

good, strong signal to the financial markets throughout the world.

Now, we have also, insofar as our planning initiatives go,

taken an effort in this Budget to go for the planning of compensation. Now this

of course, is looked at in a way by some who say, oh, yes, that is just another

way of freezing wages at a 3 per cent increase next year. Well, that is one way

of looking at it. Another way of looking at it is, it is a planned approach to

the overall expenditures that government will make; it is a planned approach to

the current account expenditures that we will make in the future and our overall

strategic economic plan to make sure that future expense of the provincial

Treasury is done on a very astute and planned basis.

Now the Minister of Finance has done this through the

presentation of his Budget. The planning of capital expenditures over a long

term, they are working on a long-term capital expenditure plan; the planning of

the amount of total compensation increases in future years by virtue of putting

a 3 per cent cap on next year's agreements that will be able to increase. These

are the kinds of initiatives, Mr. Speaker, that will allow us to maintain and

improve the fiscal integrity of the Province and the restoration, I should say.

If we had continued along the lines that the former

Governments - because we had two different Premiers in the former PC Government

that was in power, if they had continued along those lines I am often told by

constituents: for you to have to do what you did, and they firmly believe we did

what we had to, and as bad as it was - even some people who were unlucky enough

to have had their own positions with the provincial government terminated have

said to me, even though they have been denied work by virtue of the problems,

they blame the others who spent like drunken sailors at times. They do not

entirely blame us. It was a harsh measure but again we share the blame by virtue

of, I suppose, our position, all of us, as individual taxpayers.

Mr. Speaker, the Opposition often tends to look at the Budget

and look at anything that is spoken of in this Chamber and decide how they can

criticize. Well, I think the Opposition also as MHAs elected to their respective

positions certainly do have an obligation to the people to define good in what

we do as well. Occasionally you hear it mentioned, occasionally you have it

squeezed out of them by putting them in a difficult position, but often the case

is it is criticism for criticism sake and not criticism for a good reason. The

possible constructive criticism of the Opposition would do much to help improve

the situation here. Maybe they have ideas of what they can do in helping to save

some of the cost of running Government. Maybe they have some ideas of what we

can do overall. Often the case is just to criticize and offer no alternative. If

you remember last year, Mr. Speaker, the case was often to criticize but offer

no alternative to the solution whatsoever. They would say, borrow more money.

Well, that solution has been tried in Ontario and we can see by the inherent

results of a $14 billion deficit in Ontario this year just how successful is a

system where we go out and borrow more money.

We also have the case of Saskatchewan where the former PC

Government under the former Premier, now Leader of the Opposition, Grant Devine,

paid little or no attention to the happenings last year and the year prior and

chose to continue spending as they had spent in the past. They continued to try,

even though they were a PC Government, they continued to try, unlike their

federal counterparts, to spend their way out of the said recession and the

economic problems caused by the farm problems in that province. We see today

with Saskatchewan's credit rating having been lowered twice in the past six to

eight months and also the possibility that they may drop off the edge of the A

credit rating is a very fearful thing and it will not only affect them but it

will affect the whole country because if we look at the way the formulas are

used to arrive at equalization for the country when one part of our country

hurts financially we all hurt because we are then being equal at a lower level.

I have no satisfaction in speaking about Saskatchewan's problems but I do have a

sense of satisfaction in that we took the bad medicine last year, Mr. Speaker.

Hon. members opposite got up and berated me for supporting the government

initiative but yet speaking out against the closure of surgery in the Port aux

Basques hospital.

Well, Mr. Speaker, we might note in the back of the Budget

document, Appendix A, under the Department of Health, we see that surgery has

been reinstated to the Port aux Basques hospital. This certainly is a

recognition by the government that there was more information required to be

analyzed on this situation. The surgery re-establishment in Port aux Basques

recognises the geography of the region and the fears and anxiety of the people

of the area, in wanting to maintain surgery for the sake of emergency surgical

procedures.

Through the initiative of the Minister of Health and other

individuals in his Department - some able officials in there - what we did was

establish a method by which we could maintain the integrity of the doctors who

are practising surgery there through an initiative in assistance with the

Newfoundland Medical Board. This will see surgical services maintained hopefully

in perpetuity. Until a human being is to require surgery no more, we will

maintain a surgery in the Port aux Basques hospital.

That is the kind of initiative, in spite of fiscal

restraints, that the hon. minister's reorganization of the health care system

can address. That is the kind of situation that this government which has a

heart, this government which cares about people - and rather than short-term

political expediency as a way of gaining the overall confidence of the

electorate, rather than going for the short-term political expediency, this

government has taken a long-term approach with the interest of fiscal integrity

of the Province being foremost in our minds as we proceed to govern the

Province. But also keeping in mind that short-term measures and short-term

initiatives are required at times, and will be undertaken by this government to

assure that the people who are being affected by the problems associated with

the international recession, that the problems associated with the difficulties

that we have had in the fishery, mining and forestry sectors of the Province

will be attended to by many of the programs that we have.

Also, to maintain the fiscal integrity of the Province I

think is to ensure the future for our children and grandchildren, to ensure the

future for generations to come. It is a Budget document like this that will - a

Budget document in red that will see to it that the people of the future are

treated properly by governments in the future.

Thank you, Mr. Speaker.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The hon. the Member for St. Mary's - The

Capes.

MR. HEARN: Thank you very much, Mr. Speaker. I think we

should bring a rule into this House which would state that in order to speak on

any topic you should know at least something about it. Because we saw an example

that time on several topics the former speaker spoke on that he knew very little

about what he was talking about.

I cannot help but remark in conclusion that he mentioned:

fiscal integrity is first in our minds. Maybe he should realise that governments

are elected first of all to look after people, and that should be first in your

minds. Another thing, before I get into my main remarks, that the member dwelt

on was school construction. I just cannot let this one go. He got talking about

the amount budgeted this year for school construction. Now I wonder why? Because

in most of his speech he talked about his own district and the new

opportunities. I am glad to see that there are opportunities out there in the

great area of Port aux Basques. But the member all of a sudden went out on a

limb and started talking about the amount of money in the Budget for school

construction. Now why would you zero in on a small

section in a large budget

among many departments?

The answer is, of course, that the Opposition has been

getting heat - or the government has been getting heat. I am so used to looking

across at them. About the amount of money put in for school construction. So the

member tried to justify the meagre amount put in the Budget for school

construction. We dropped the amount from $27 million down to $20 million in

order to plan long-term. It is the ad hoc political decisions, the ad hoc

political expediency, that was used by the former government in relation to

school construction. There was no planning.

Let me tell the hon. member that the first thing he should do

is apologize to the DEC's. He should stand up and apologize to the DEC's,

because the former government, as with the present government I hope, had no

connection at all to how the money was spent in relation to school construction.

Each year a certain amount of money is budgeted for school construction, and

passed on to the Denominational Education Committees who in turn, in

consultation with the school boards throughout the Province, based upon the

priorities of each board and then based upon general priorities, construct or do

major repairs to buildings.

I hope there is none, or there never has been, any political

involvement with the construction of schools. The member is now talking to a

former chairman of the board of one of the largest boards in the Province, and

he will tell him, I hope, that the government does not get involved with the

building of schools. They do not go out and tell boards which schools to build -

or they never did. Maybe this government is doing it. They have not done it in

the past. They have never told the Denominational Education Committees where or

how to spend the money. It is done in a very impartial, non-political way, as it

should be when you are dealing with education.

For the member to get up and talk about money being spent

without planning, in a political expedient way, he is insulting the

Denominational Education Committees in this Province, and he is insulting the

school boards right throughout this Province, because they are the ones who,

entirely on their own as your colleague will tell you, make the decisions on

where that money is spent. They have been making that decision for the years

past for long before I can remember. Consequently, for the member to say, oh, we

dropped the money - number one he alludes to the fact that money was wasted;

that the $27 million was not needed; that it is trimmed down to $20 million

because a lot of money was wasted because of political decisions that were made.

So if he is accusing school boards and Denominational Education Committees of

playing politics with the money, then it is strictly within their own ranks

internally, because they have no dealings with government in relation to how the

money is spent, the member should apologize on his hands and knees. He should

get down and beg forgiveness for insulting people who volunteer to make such

decisions so that they will not be left in the hands of politicians who could go

out at election time and promise schools, as they promise roads and hospitals

and everything else. It has never been done, and hopefully it never will be

done. So I say to the member, he had better get his facts straight and before he

does anything else, he should apologize to the DEC's and the school boards of

this Province.

Let me look at why he mentioned it. He got caught up in what

he was saying, because he had been told to highlight that issue because of the

embarrassment of cutting down on school construction when it is so badly needed.

The $27 million that was in the Budget over the last few years for school

construction was not only directly related to the building of schools and the

repairing of major needs, weaknesses with different schools throughout the

Province, but there was a certain amount of money in that allocation which

helped school boards restructure some of their old debt load, and it enabled a

number of the boards to start rising towards the surface. Many school boards

throughout this Province a few years ago had a tremendous debt load. Some of

them were actually bankrupt. If it had been business they would have been

bankrupt. But with proper allocation of funding to the DECs and through them to

the boards they were able to address some of that debt load and consequently

move towards the black. The boards today are in better shape than they were in

the past in relation to their debt load. The problem today is in relation to

their operational funding which I will get into in a few minutes.

But to look at dropping the amount of money that has been

allocated to them by $7 million is extremely significant. The boards are having

a hard job themselves, especially in light of the centralization that we see,

which is good; the coming together of schools within certain areas; the coming

together of school boards of different religious persuasions; amalgamation

throughout the system. It is encouraging. It can only be done - how you bring

the different denominations together, how you eliminate smaller schools, and how

you eliminate duplication - you build new schools. You build centralized

schools, such as Venture Academy on Fogo Island. A prime example of what can be

done.

You cannot build new schools and you cannot expect people to

come together, eliminate the duplication, if you have no money to repair or

rebuild. When a government which goes out, and a Minister of Education who goes

out, and preaches coming together, the need to conserve, and the need to be more

prudent about our expenditures, who then goes out and cuts a construction budget

by $7 million - by over a quarter of the total budget that they had for school

construction - that is flying in the face of everything that they preach. Preach

one thing, do the exact opposite.

The poor Member for LaPoile was told to get up today and try

to explain this embarrassment. Try to get on the record that we had to do this,

that we had to change from $27 million down to $20 million in school

construction, so that we could implement long-term planning because of all the

political interference that was done in the past. The words he used: the ad hoc

political expediency, is what he used.

So what he is saying is that because the DECs and the school

boards have been playing petty politics internally over the past few years - I

am not sure whether he meant on a religious line or on a construction line -

that the government is going to cut their funding. Surely he is not talking

about the former government, because like I said, governments do not interfere

with the expenditure of these dollars. So we see a total embarrassment here of

the DECs and the school boards by the Member for LaPoile, who had been told to

go out and make an excuse and got carried away.

So perhaps the hon. member should get the facts of the

matter. Maybe he should ask the Minister of Education to explain how - if he is

so interested in education - in light of the needs in education today you can

take a construction budget - one of the parts I suppose, one of the sections of

our total Budget that is spent non-politically, that is spent according to need.

Where there is strict scrutiny, where you have lists of priorities coming in

from boards, where you have them being assessed at the board level by

independent, voluntary people, by professionals involved, then being forwarded

to the DECS and all their committees, once again made up of numerous people,

most of them volunteers, who then pick on a priority basis the construction

needs for the coming year.

How you can take money like that and cut it because of the

political expediency leaves one to wonder what the government really knows about

what is going on in the field of education.

Mr. Speaker, there are a few other things I want to say about

education, but before I get into that - because I want to spend maybe more time

on that than anything else - I want to highlight a couple of other departments.

I was going to ask the Minister of Environment and Lands, I guess, who is

responsible for Wildlife -

SOME HON. MEMBERS: (Inaudible).

MR. HEARN: Mr. Speaker, I wonder if you could quiet down

the natives -

MR. SPEAKER: Order, please!

The hon. the Member for St. Mary's - The Capes.

MR. HEARN: I wonder if we could ask the Minister

responsible for Wildlife why it's taking so long to capture a polar bear? We

have a polar bear up in St. Mary's - The Capes going from door to door, coming

in, sitting down in living rooms. How would the minister like it tomorrow

morning to get up and see a polar bear in eating her porridge?

AN HON. MEMBER: (Inaudible).

MR. HEARN: That is exactly what is happening. Polar bears

sitting down in your living room, knocking on a different door every night. I

was getting a little bit nervous. First of all I heard of the polar bear being

in Trepassey, and then it was seen in St. Shotts, then it was seen in Peter's

River, yesterday it was in St. Mary's and today it is up knocking on doors in

Mount Carmel. I got the feeling that the Liberals are trying to run the polar

bear because he would have as good a chance as any Liberal of getting elected up

there as they know.

AN HON. MEMBER: They are sending a yellow dog to Goose

Bay.

MR. HEARN: That is right, but the question is why is

everybody else seeing and talking to the polar bear and the wildlife people

can't find it? The serious thing about it is what might happen if a polar bear -

a hungry polar bear - runs across some individual? A fellow from St. Shotts was

telling me today that the people of -

AN HON. MEMBER: (Inaudible).

SOME HON. MEMBERS: Oh, oh.

MR. HEARN: The people of St. Shotts on Saturday night

were extremely worried when they heard the polar bear was in the area. The

people went out to put their animals in and went home to be sure there was

somebody with the family because it had crashed through a window of a house in

Trepassey. Luckily the man of the house was home. He is usually on the draggers.

If he had not been there his wife and two small children - just imagine the

trauma of trying to face a polar bear in your living room. It certainly is not

funny. But like I said the question the fellow in St. Shotts asked, what would

have happened if somebody had met him out on the road? There is not even a tree

to climb. So the problem is what would you do? It is extremely serious when you

have a wildlife officer, one apparently according to the news - I hope they are

wrong - driving around to see if he can spot it. Surely there should be a

concentrated effort. When the bear has broken into one home and attempted to

break into a couple of others and is there.

Now luckily he has not attacked anybody, but what happens if

somebody is attacked, hurt or mauled by a polar bear? What excuse can the

department come up with for havi