Volume XL Tuesday Province of Newfoundland FORTIETH GENERAL ASSEMBLY -OF NEWFOUNDLAND Third Session VERBATIM REPORT {Hansard) Speaker: Honourable Patrick McNicholas Number 40 12 May 1987

The House met at 3:00p.m . MR. SPEAKER (McNicholas): Order, please! Statements by Ministers PREMIER PECKFORD :· Mr. Speaker. MR. SPEAKER: The hon. the Premier. PREMIER PECKFORD: Mr. Speaker, on April 2 in this · House, the hon. the Minister of Finance announced in the Budget Speech the intention of my administration to review the efficiency and effectiveness of government operations and programmes. The ultimate goal of this plan is to eliminate government 1 s current account deficit and to reduce government 1 s annual borrowing requirements.

My administration has approached the Government of Canada for both s hart and long term financial and economic assistance. However, regardless of the response from our federal government, we consider that we must take whatever initiatives we can to significantly improve our financial position over the next several years.

One of these initiatives, and I stress that this is only one of the initiatives we will be taking, is to carry out the promised review of efficiency and effectiveness of government operations and programmes to clearly demonstrate to all concerned that we are very serious about reversing our worsening position. L2098 May 12, 19 8 7 Vol XL To carry out this review, we have selected from the very highest ranks of our public service, a senior expenditure review team consisting of: Mr. Clarence Randell as Chairman; Mr. Gilbert Gill, Secretary to Treasury Board as a member of the Committee; Mr.

Lorne Wheeler, Deputy Minister of Education; and Mr. Lew White, Deputy Minister of Transportation. Mr. Randell has been seconded from his position as Deputy Minister of Municipal Affairs and will serve as Chairman of the Committee on a full-time basis. The team will report to the Planning and Priorities Committee of Cabinet and will be supported by staff from Treasury Board Secretariat, Cabinet Secretariat and staff from other departments as deemed necessary.

The team has been asked to prepare by June 15, 1987 for review by Cabinet, a preliminary report setting out the methodology it intends using , a work s c he d u 1 e including key dates for reviewing its work and the composition of the support and research group which they will require .. The team has also been asked to make recommendations on how best to utilize external efficiency experts. My administration sees this action as a professional and responsible approach to overcoming the difficult financial situation that we face. Thank you, Mr. Speaker. MR. LUSH: Mr. Speaker . MR.

SPEAKER: The· hon. the member for Bonavista No. 40 R2098

North. MR. LUSH: Mr. Speaker, I find it rather surprising that at this late date, after fifteen or sixteen years of Tory rule, that all of a sudden we feel we have reached that abysmal situation in our Province's finances where we have to select a review committee to look into the efficiency and effectiveness of government operations and programmes. Mr. Speaker, there is no doubt that this committee is going to have plenty of work when we look at the financial position of this Province, particularly the current account deficit and other matters and other programmE!S that the Premier refers to.

There is no question of the need, but I would suggest it is coming rather late. It is an indictment on the government, the Department of Finance, that after fifteen or sixteen years they have to appoint a committee to look into the efficiency and the effective~ess of government programmes. I would suggest, Sir, that it should have been done a long, long time ago. And I wish them luck. There is no question that we have some . good people there, but I am just wondering, Mr. Speaker, whether the situation is not too far gone for these people to deal with it . The so 1 uti on to this problem, Mr.

Speaker, is not a review committee, it is an entire, new administration. SOME HON. MEMBERS' Hear, hear! MR . LONG: Mr. Speaker . MR. SPEAKER: The hon . the member for St. John's East. L2099 May 12, 1987 Vol XL MR. LONG: Thank you, Mr. Speaker. We welcomE! the staternelnt inasmuch as notice was given in the Throne Speech that an initiative would be taken. SOME HON. MEMBERS: In the budget. MR. LONG: I believe there was also reference in the Throne Speech to government's plans.

In any case, we have concerns about this committee reviewing efficiency and effectiveness, because the tendency these days is for that l:o be buzz words and euphemisms for a programme to cut back and streamline. The mandate of this committee will be to see where people in this Province can be hurt further with cuts to education, health and social programmes. I would also note that it is unfortunate the Premier was not able to have as one of the senior members of this committee a woman . The Minister for Career D~velopment and Advanced Studies (Mr.

Power) keeps talking about the affirmative programme of this government. That is not reflected at the highest levels when government is taking its own initiatives. It should be includi ng women. Ii: just so happens that the Chairman of thE! committee will be From the Municipal Affairs Department, and we would have a concern that that would lend to the committee an inclination to politicize its whole review with an eyE! to more patronage and taking care of the Tory districts in this Province.

Finally, we would suggest that the time line and the outline for the procedure for this Committee is only going to represent another No. 40 R2099

bureaucratic impasse. It is unclear how long this Committee is going to take to do its report. It may indeed need, according to the description here, close to a year to begin to suggest ways of implementing changes, and maybe that is an indication from the Premier that we can expect an el~ction within the next couple of months, because this Committee has a lot of work to do and it is going to be given a lot of time to make these recommendations. Thank you, Mr . Speaker. MR. RIDEOUT: Mr . Speaker . MR . SPEAKER : The hon. the Minister of Fisheries . SOME HON . MEMBERS: Hear, hear! MR. RIDEOUT : Mr.

Speaker, the Middle Distance Development Programme being administered by my department, in conjunction with the fishing industry, has been ongoing since 1985. We are now in the third season of operation and overall the prospects for the successful deployment of this type of technology within the context of our overall fishery are very favourable. Today, Mr. Speaker, I am pleased to advise that in 1987 the industry will become even more involved in this programme in that arrangements are now in place to ensure that a large number of fish processing plants have access to the fish landings from these vessels .

The purpose, or the initial objective of the programme, was to ensure that fishermen became competent in the use of this type of harvesting technology. Towards L2100 May 12, 198'7 Vol XL this end 11 Highliner 11 skippers and crews, predominantly inshore fishermen, were attracted to this operation. The vessels were leased to the fishing captains to operate on a commercial basis. The initial training/development process, although ongoing, has reached a stage that we can now more widely involve the onshore processing sector.

Consequently, arrangements are now in place to ensure that processors have equal access to process this fish in order to directly evaluate such relevant factors as quality, yields and market returns. In pursuit of this, Mr. Speaker , I have made an agreement with the skippers and the processing members of the Fisheries Association of Newfoundland and Labrador, the Independent Fish Producers Association, and the Canadian Saltfish Corporation.

These three processing groups have formed a tripartite cornmi t tee and have hired a co-ordinator, or shore skipper, to oversee the onshore distribution of fish and to service the vessels. This programme, Mr. Speaker, involves a tot a 1 of approx irna te 1 y 66 plan{: s, both fresh/frozen and salting operations. Further arrangements provide for a distribution of fish to frozen product or salt, depending on the best OVE!rall advantage to the vessels and plants. Mr. Speaker, this system has bE!E!n implemented since the vessels commenced operations this year and initial results are positive.

This method of fish distribution is currently a trial period for all parties and will be E!Valuated at the end of the year. The and inclusion processing No. 40 of both plants fishermen in the R2100

Middle Distance Development Programme is another step to ensure a successful deployment of a •state-of-the-art• fishing technology to effectively and efficiently harvest our fishery resources to the maximum benefit of all those who are involved. MR. W. CARTER: Mr.' Speaker. MR. SPEAKER: The han. the member for Twillingate. MR. W. CARTER: Mr. Speaker, I thank the minister for providing me with a copy of his statement prior to reading it. There are still a lot of questions that remain unanswered with respect: to the viability of the middle distance fishery. We welcome this announcement by the way.

We have felt for quite some time now that the distribution of the harvest from the existing mid-distance fleets has not been too fairly distributed. For example, we have heard rumors, and I am sure the han. minister has heard them -probably that is what prompted him to initiate this new policy -that maybe certain inshore plants were getting special treatment, that the fish was going to a certain number of plants, or one or two plants, and that favouritism was being shown.

So, in that regard, we certainly welcome the announcement that there will be a fair distribution of the catch of these middle distance fishery vessels. Because not only must the catch be fairly distributed, it must appear to be. And that is very important, too.

People in my own district of Twillingate, for example, where they have a fish plant that is operating at about 30 per cent of L2101 May 12, 1987 Vol XL its actual operating capability, if they preceive that there is. hanky-panky and that the harvest from these government sponsored vessels is being directed to one or two plants for political or other reasons, then I think it will do nothing toward promoting the idea that the minister has been espousing these past few months. We are not fully convinced yet, Mr. Speaker, that the middle distance fishery is all that the minister would have us believe it is.

We have not been given any information that I am awarE! of as to the cost, for example, of l:he fish that is being harvested by these vessels. We are not in possession of any real hard facts on the operation itself in tE!rms of how successful or otherwise they have been at har1Jesting. We have heard s.tories that last YE!ar there were considerable amounts of money lost in these vessels because the catches were down and the turn-around time was long. We hope that before this· SE!Ssion ends, Mr. Speaker, the minister wi 11 see fit to give the H o us e a full report.

I know in CornmiU:eE! he did, in fact, reveal certain aspects of the middle distance fishery, very important aspects. In fact , I be 1 i eve it was becausE! of a que s i: ion that was p u t to him from this side of the House with respect to the distribution of the landings. Maybe we would li.ke to think that that is what precipitated the announcement madE! by the minister today. Although, I believe at the time he did give some indication that they were looking at the prospects of setting up some kind of a tripartite arrangement where the fish would be more evenly and more No. 40 R2101

fairly distributed . MR. SPEAKER: Order, please! The hon. member•s time has elapsed . MR. W. CARTER: We would like to know, Mr. Speaker, if I can for half a minute, what effect this is going to have on the inshore fishery, for example. What is the fish going to cost? And just how successful have the existing vessels been in the harvesting? MR. LONG : Mr. Speaker . MR. SPEAKER: The hon. the member for St. John•s East. MR. LONG : Thank you, Mr. Speaker. We welcome the minister•s "statement inasmuch as there are some positive points in the statement.

The attempts by his department to expand and diversify processing in the industry is very significant and we look forward to further developments. Also, the notice that he has given · of the co-operation of the tripartite commit tee is an important step to try to bring together different representatives t.uith different interests in the industry to work together on a common plan. We would hope that would signal an intention by the government to try and bring together in the future an integrated plan for the fishery that would include all elements. With that said, Mr.

Speaker, we would have some concerns inasmuch as the minister comes in and makes statements and still has nothing to. say for the inshore fishery, the inshore fishermen in this L2102 May 12, 1987 Vol XL Province who have been recently meeting in Gander and presenting a litany of their concerns without any response, without an initiative, without any action by this government. We also have a concern about the emphasis on the state-of-the-art technology and technological changes as it relates to the fishing industry - the announcement in recent weeks of an invention being made in St .

John • s, and support given by the federal government to a man who is developing a new way to sort fish. There are serious questions to be asked about the introduction of new technology ·in the fishery, and we would hope that in future the minister wiJ.l be able to give more detailed responses to t:he kinds of changes that new technology will introduce in terms of numbers of people working.

We would see the emphasis on the middle distance here as being a problem of perhaps encouraging inshore fishermen to get out of the inshore, increasing unemployment in the inshore, encouraging people, both t.ui th new technology and an emphasis on middle distance, to create higher unemployment. Thank you, Mr. Speaker . SOME HON. MEMBERS: Hear, hear! Oral Questions MR. SIMMONS : Mr. Speaker. MR. SPEAKER: The hon. Opposition . MR. SIMMONS: the Leader of thE! Mr. Speaker, I want to return to No. 4-0 R2102

the Premier•s latest fetish to put cucumbers and tomatoes on every table in Newfoundland four meals a day. What he has got against strawberries I do not know, but perhaps he will add that for dessert two meals a day. Mr. Speaker, to his fetish about hydroponics - and we are of the view that it cannot be much more than that; he has given little information that would justify it as a serious enterprise at this point in time - specifically could he indicate to the House why it is the federal government is not involved in this matter?

It seems to us that every time the Province floats a new idea, sponsors a new project, espouses a new project, it goes cap in hand to Ottawa, the whole theme of the recent budget, for at least 70 per cent or 90 per cent of the funding. Why in this particular case, where so much of the taxpayers • money is ·involved, was not the federal government involved in funding at all or was that a thought that was dealt with? MR. SPEAKER: The hon. the Premier. PREMIER PECKFORD : Mr. Speaker, obviously, like most thoughts along that line, it was dealt with.

In all of the things that we have done over the last three or four years, in new agreements that we have reached with the private sector or whatever, we have always explored every avenue that we could. Let me say to the han. member and his

preamble, yes, we are into strawberries. The member for Humber Valley (Mr. Woodford) can tell you a lot of good success stories that are happening there. The Minister of Rural, Agricultural and Northern L2103 May 12, 19 8 7 Vol XL Development (Mr. R. Aylward) a number of weeks ago announced a whole bunch of new job creation projects for burning land for blueberry development. We want to be into blueberries as well, we want to be into stratJJberries, we want to be into every single thing that will work in this Province to create jobs. Yes, Mr.

Speaker, we will be into cucumbers and tomatoes and red peppers and lemons and limes and anything else we can do if it is going to create jobs and if it is viable. The federal government was approached through their various programmes and the project does not qualify under the criteria. It is one of our ongoing arguments with the federal government, this one and previous federal governments, that the criteria that are applied across the nation are not conducive to new, innovative projects and so on that we have on the drawin<.:l boards and that we are applying for and that we are trying to do.

So WE! did apply for assistance, thE! two partners involved het'e, and we were told that we do not qualify under the existing criteria for any of the programmes that the federal government offers nationally and in this part of the country - unfortunately, very, very unfortunately . May I also take this opportunity to · condemn both CBC and the member for Menihek (Mr. Fenwick), who in the last twenty-four hours has tried to show somehow or other that a special electr·ical subsidy goes with this project. There are no electrical subsidies on this project, Mr. Speaker. MR. SIMMONS: Mr. Speaker . No. 40 R2103

MR. SPEAKER : The hon. the Leader of the Opposition. MR. SIMMONS : Mr. Speaker, the Premier singles out my good friend from Humber Valley who, because of his knowledge of strawberries and far-ming generally, surprises us that he sits there in silence while this scheme is being perpetrated on the people of Newfoundland and Labrador. SOME HON. MEMBERS: He is not your good friend . MR. SPEAKER: Order, please! MR. SIMMONS: He is still allowed to pick his friends, and he picks them well. SOME HON. MEMBERS :· . Oh, oh! MR. SPEAKER: Or.der, please! MR. SIMMONS: Mr.

Speaker, the Premier mentions the reason the federal government did not get involved. I would suggest to him another reason: Is he aware that a company called Calagro, C-a-1-a-g-r-o, which had contracted with Sprung to use the Sprung technology, the same technology that is to be used in the present instance here, applied to the federal Department, DREE, or DRIE as it is now, and that its application in the past few days was turned down on the grounds that DRIE did not believe the technology was adequate, that DRIE questioned the technology being advanced in the Calagro application in PEI? MR.

SPEAKER : L2104- May 12, 1987 Vol XL The hon. the Premier . PREMIER PECKFORD: Mr . Speaker, I am aware that: the PEI government went out to an ind~pendent consultant, who is knowledgeable in the · biotechnology field and totally independent of either the PEI government or thE! federal government, and asked for their opinion on this technology and on this new project and that the independent consultant carne back and said, 'This is a grE!at technology and it should be advanced and the PEI government should get it.' MR . SIMMONS: Mr. Speaker, a final supplementary. MR.

SPEAKER: A final supplementary, the hon . the Leader of the Opposition. MR. SIMMONS: Mr . Speaker, the Premier, of course, did not answer the operative question. The operative question is: Is he aware that the Department of DRIE turned down the a p p 1 i cation on the . bas i s that it questioned the technology involved in the Sprung-Calagro proposal? SOME HON. MEMBERS : You are against jobs . MR. SIMMONS: Mr.

Speaker, being for or against jobs has to be weighed in the context that if in producing 150 jobs you destroy several hundred existing jobs, that is not a very sensible trade-off, and that is one of o~r concerns. Now, Mr. Speaker, the question to the Premier is this: What is the rush on this particular one? The Premier says he wi11 table documents after we are locked into the deal, after . the deal is No . 4-0 R2104

signed. If this is so good, Mr. Speaker, if this is the best thing · since sliced bread, as we are told, why will the Premier not trust it to stand up to some public scrutiny? Why will he not give us the basic information now so that the people of Newfoundland, including the fa~mers and the greenhouse operators and other people who feel threatened by this, will have the ·facts and will realize that this government is as all wise as it pretends? What is wrong, Mr. Speaker, with trusting the public 1 s judgment on this matter ·?· Give us t·he facts so we can judge. What is the rush, I ask the Premier, on this?

Why will he not put before the public the basic information? PREMIER PECKFORD: Mr. Speaker. MR. SPEAKER: The hon. the Premier. PREMIER PECKFORD: Number one, I am DR! E turned down p. E. I. MR. SIMMONS: not aware a proposal I just told you that. PREMIER PECKFORD: that from You asked me if I was aware, and I am telling you, answering you that I was not aware. Okay . You asked me a question so I am answering you. I am not aware that that is the reason why it was turned down. I am aware that DRIE turned us down, this joint venture down because it did not fit the criteria. I am not at all surprised, in any case - MR.

EFFORD: What criteria? L2105 May 12, 1987 Vol XL MR. SPEAKER : Order, please! PREMIER PECKFORD: it was turned did not meet the crazy wording that SOME HON. MEMBERS : Oh, oh! MR. SPEAKER: Order, please! PREMIER PECKFORD: down because criteria of it does. it the Mr. Speaker, I am not surprised . I do not know how many Newfoundlanders could come to Confederation Building tomorrow but there could be an awful lot of them line up at Confederation Building to tell stories about being turned down by DRIE, Mr. Speaker. They are turned down every day, and not necessarily for good reasons.

I would like to know whether DRIE has investigated this. Did DRIE go to the National Researc h Council, which over the last three or four years have been partici pating with the Sprung Group of _Companies in the development of this technology and which has given it a clean bill of health? Go to the people who know about this technology, Mr. Speaker. SOME HON. MEMBERS : Oh, oh! MR. SPEAKER: Order, please! PREMIER PECKFO~D: Number two, what is the rush? hE! asked. There is no rush, Mr. Speaker. We have been negotiating with this company for six or seven months. MR. EFFORD : Secretly. No . 4-0 R2105

PREMIER PECKFORD: Secretly? We were elected to govern, Mr. Speaker, and that is what we are going to do. We are going to create jobs. We are going to take advantage of all opportunities that we have, Mr. Speaker, and we have given the basic facts of the matter, the financing arrangements. There ·are no · electrical subsidies of any kind or form. They will pay industrial rates, that joint venture company. And the high intensity lights will not even be paid for by the joint venture company, Sprung has to pay to · purchase th .em and . has to pay the operating of them, not the company. No electrical subsidy!

As a matter of fact, it is just the opposite; we are so well protected that they got to buy the high intensity lights and they have to pay for their operation, not the joint venture company. And under . normal operations there is no - MR. TULK: What about the $13.5 million? MR. SPEAKER: Order, please! PREMIER PECKFORD : - thought but that they will pay the industrial rate the same as everybody else. There was no rush, Mr. Speaker. We spent seven months negotiating this deal. It is a good deal. And if the hon. Leader of the Opposition does not think so that is too bad.

We are about our busine!SS of creating jobs and attracting new tee hnology to this Province. SOME HON. MEMBERS : Hear, hear! MR. FUREY: Mr. Speaker . L2106 May 12, 1987 Vol XL MR. SPEAKER: The hon. the member for St. Barbe. MR. FUREY: Mr. Speaker, the Premier said yesterday in this House that no one else has this technology. 1 We have attracted Sprung to this Province putting us on the leading edge, we will not be last, we will be first. 1 I ask the Premier in his - MR . TOBIN: Regrow your leader. MR. SPEAKER : Order, please! MR. FUREY: Mr.

Speaker, in the Premier 1 s seven or eight months of negotiations and intensive research, did he come across any Newfoundlanders or Labradorians who were involved in hydroponics? MR. SPEAKER: The hon. the Premier. PREMIER PECKFORD: No, Mr. Speaker . MR. SIMMONS: You got sucked in . MR. MATTHEWS: Is that not something? MR. SPEAKER: Order, please! PREMIER PECKFORD : I know what the hon . re!ferring to. MR. SIMMONS: Hydroponics is what referring to . MR. SPEAKER: Order, please! No. 40 member is we are R2106

PREMIER PECKFORD: Yes, hydroponics, referring to the Sprung hydroponic development. The press the other day, and I look up there, especially at the CBC crowd, the socialists up there in the gallery from CBC - SOME HON. MEMBERS : Hear, hear! PREMIER PECKFORD: and some of the others talked about the gentleman from Seal Cove who was supposed to be into hydroponics. I have checked in · the Department of Rural Development, I have checked in the Department of Agriculture, there has been no application from that gentleman submitted to either the Department of Agriculture or the Department of Rural Development.

He enquired some i:ime ago and we sent out a package to him, Mr. Speaker. And there are · lots of people involved in hydroponics but there is nobody who has this particular technology except Sprung. SOME HON. MEMBERS : Oh, oh! MR. SPEAKER: Order, please! PREMIER PECKFORD : They can laugh and they can jeer, Mr. Speaker, but Sprung has this particular technology patented, nobody else has it. You can go and ask any leading biotechnologist in the world and learn this is different from the other hydroponic developments that people are talking about, Mr. Speaker. MR. FUREY: Mr. Speaker. L2107 May 12, 1987 Uol XL MR.

SPEAKER : The hon. the member for St. Barbe . MR. FUREY: This is why it is so important: to have tabled all documents, economic analyses, all surveys, all studies. Mr. Speaker, I was not talking about the gentleman from Seal Cove. I was talking about the gentleman from St. John's who has been into resE!arch and development for five years, count them, five years into hydroponics. He has produced fiue crops of tomatoes, he is currently producing romaine lettuce for local restaurants, and I want to know why he is not getting part of that $13 million. MR. SPEAKER: The hon. the Premier .

PREMIER PECKFORD: He has not come of Newfoundland far as I know, there is none to the GOVE!rnment to ask for any as Mr. Speaker. And MR. SIMMONS : That is not what you said . You said it was not going on! MR. SPEAKER: Order, please! PREMIER PECKFORD: I said there is other hydroponic developments going on but not the Sprung technology. MR. SIMMONS : No, they are better. PREMIER PECKFORD: No, it is not, Mr. Speaker. MR. TULK: You do not know about it . PREMIER PECKFORD : I do so know about it. Mr . No. 4-0 R2107

Speaker, I do so know about it. Mr. Speaker, I would just ask the member for the Opposition to contact the National Research Council today, I will give them the · address of the person who is involved in biotechnology in the United States, who built the technology centre at the Epscott Centre in Disney World. I refer - MR. EFFORD: That is where they found it, in Disney World. MR. SPEAKER: Order, please! PREMIER PECKFORD: No, . no, Mr. Speaker. I refer the hon. gentleman to the Dean of Science at Memorial University who worked with the National Research Council and who is also an expert in that field.

Go to the experts and ask them the question, does anybody else have the technology for growing that the Sprung Group of Companies have? The answer will be, no, Mr. Speaker, nobody else has it. MR. FUREY: Mr. Speaker. MR. SPEAKER: A final supplementary, the hon. the member for St. Barbe. MR. FUREY: Mr. Speaker, the local entrepreneur I am talking about has Sprung technology and much, much more. Here is what is interesting, Mr. Speaker.

I want to ask the Premier why he said in Gander to t·hese local entrepreneurs, - and he said it, they are not my words they are his - •put your money where your mouth is, • and this gentleman put $110,000 where his mouth was. Through loans, tht'ough begging, L2108 May 12, 1987 Uol XL through borrowing he put the money together, he has developed and researched hydroponics where he can produce for restaurants, so why are you ignoring local people? MR. SPEAKER: The hon. the Premier . PREMIER PECKFORD: I am not ignoring local people.

Every day we are approving loans for local people through Rural Development, through all of our programmes. We will look at any proposal from anybody. We have got nothing against anybody. Anybody comes to us with an opportunity we will pursue it, Mr. Speaker; as we have in the past we will in the future. But if we can get a very, very high tech industry going and bring new investment into the Province too, so much the better. But: if thE!re is a local Newfoundlander or Labradorian around with an idea and wants to pursue it, we will pursue that as well, Mr. Speaker. No problem with us, nonE! whatsoever. MR.

TULK: Mr. Speaker. MR. SPEAKER: The hon. the member for Fogo. MR. SIMMS: Now we will hear it! MR. TULK: My economist from Grand Falls is at it again. Mr. Speaker, the hon. gentleman has admit ted that he is not aware that hydroponic technology even better than the Sprung Group has is available in Newfoundland. DR. COLLINS: Where did you get that story? No. 40 R2108

MR. TULK : Will he now go out and do the research that is necessary to tell him that indeed it is? And if it is, will he cancel this agreement in principle that he is being taken for the sum of $13.5 million on? SOME HON. MEMBERS: Hear, hear! MR. SPEAKER : The hon . the Premier . PREMIER PECKFORD: Mr. Speaker, the onus is on the · gentleman and members opposite to prove their allegation that there is a hydroponic technology more advanced - MR. TULK : The people who work for you know about it. MR. SIMM ONS : You gagged them. PREMIER PECKFORD : Mr. Speaker, may I answer?

I never said a _ word when the hon. member asked the question. MR. SPEAKER : Order, please! PREMIER PECKFORD : and more effective than the Sprung technology. I tell the hon. gentleman that the onus is on those people opposite to prove what they are saying, Mr . Speaker. MR . TULK: A supplementary, Mr. Speaker . MR. SPEAKER : Order, please! Before recognizing the hon. the member for Fogo, there is a considerable amount of L2109 May 12 , 1987 Vol XL interruption from bot h sides and it is not helping either side. I have called order on many occasions, so I ask - h on. members to remember that.

The hon. the member for Fogo . MR. TULK: Mr. Speaker, the Premier obviously does not know what is happening in his own government. Is the Premier aware that this gentleman, referred to by the member for St. Barbe spoke to the Parliamentary Assistant (Mr. Warren) to the Minister of Rural, Agricultural and Northern Development (Mr . R. Aylward) this morning? Will he investigate and see if that is the case, and will he inVE!StigatE! further to see if the hydroponic technology involved there is far in advance of what the Sprung has put together? SOME HON. MEMBERS : Hear, hear! MR. SPEAKER: The hon. the Premier.

PREMIER PECKFORD: Absolutely, Mr. Speaker, absolutely. No problem whatsoever. If there is another opportunity out there with somebody who has a hydroponic technology that they c:an prove! is better than the Sprung technology, we want that too. WE! want E!VE!ry single thing we can get, Mr. Speaker. We will support him _ The Minister of Rural Development tomorrow is to present to this House - it is here now, today 220 applications totalling $4.4 million from Rural Development into all kinds of agriculture, all kinds of craft development and all kinds of resource devE:1lopment, Mr. Speaker.

That is what we are here for, $4 million, to any No. 40 R2109

Newfoundland that is there . I caution the· hon. member, because he is digging a hole for himself, as they done since 1972. We will investigate it and see what it is about. We have had the leading scientists in the world look at the proposal we are talking about, anq we know from whence we are coming, Mr. Speaker. We know we have a success on our hands, the same as Come By Chance, the same as Kruger, and the same as fishery restructuring. There may be people around who do · not like it, Mr. Speaker. There might be a little bit of a c.onflict, Mr. Speaker. Some people do not like change.

They do not like moving on and creating new jobs. They are afraid now an election might be coming with all these positive announcements, Mr. Speaker . They are down in the polls eleven points, Mr. · Speaker, according to the last pole. September is coming, Mr. Speaker. SOME HON. MEMBERS : Hear, hear! MR . TULK: A final supplementary, Mr. Speaker. MR. SPEAKER: A final supplementary, the hon . the member for Fogo. MR . TULK: Mr . Speaker, oh for September to be today! Yes, Mr. Speaker. Come By Chance, Newfoundland Energy Limited, very secret. Bermuda. Your officials gagged.

Will the hon. gentleman now agree to give us all of the information that is in his department, table it so that the Newfoundland people get the information before he signs the deal? L2110 May 12, 1987 Vol XL Let me ask him one other question. If he can find the hydroponic technology that we haVE! said is in this Province, will he then cancel the deal with Sprung and save this Province $13 .5 million which Mr. Sprung has taken the Premier to the cl eaners for? SOME HON. MEMBERS : Hear, hear! MR .. SPEAKER: The hon. the Premier. PREMIER PECKFORD: I will get both of them, Mr. Speaker.

I will not: cancel one or the other . I will have both of them. As a matter of fact, I have been informed by the Parliamentary Assistant to the minister that a meeting has been arranged already for the gentleman who called in this morning with the Assistant Deputy Minister of Agriculture . No problem! MR . SIMMONS: What about your seven months of researc.h. PREMIER PECKFORD: We are told it by the best people in the world, not in Newfoundland singularly but from the Dean of Science at Memorial, from thE! National Research Council, from the biotechnology people in the United States, Mr. Speaker.

We will investigate. We will see! where the hon. member is coming from. We will find out. MR. FENWICK: Mr. Speaker . MR. SPEAKER: The hon. the member for Menihek. MR . FENWICK: My question is for the Premier as well and has to do with t:he same No. 40 R2110

project. SOME HON: MEMBERS: Oh, oh! MR. SPEAKER: Order, please! MR. FENWICK: My . question to the Premier is this. The question. is not so much whether or not the technology can make cucumbers and tomatoes grow in this Province, that is proven. The question is not whether it is hydroponic . The question is whether or not it is growing them ' economically so they can be sold at the level of investment that is there. I am going to ask the .

Premier if he knows that both Bev MacPhail and Brian Thoms, scientists for the Nova Scotia Department of Agriculture, were contacted by the Minister of Argriculture 1 s Department and were asked about their opinion of the technology and they told the minister 1 s department that under no circumstances would this be economical at the cost of having the thing done. The government has actually gone against the reports produced by his own Department of Agriculture in going into what is an extremely risky and extremely improbable situation that will never ever produce on the level it is supposed to. MR.

SPEAKER: The hon . the Premier. PREMIER PECKFORD: We have a lot of reports from a lot of people, Mr. Speaker, and we have done an awful lot of research on thern, and given the additional high intensity lights that we intend to put in there, given the marketing analysis that we have done, we are convinced that this can be a very economically viable L2111 May 12, 1987 Vol XL project, number one, and, number two, through that project and as part of it we also have research and development going ahead on an ongoing basis for other products so that we become a center in that kind of technology transfer. MR.

FENWICK: A supplementary, Mr. Speaker. MR. SPEAKER: The hon. the member for Menihek . MR. FENWICK: I want to give the Premier the name of two other scientists at the University of Guelph in Ontario, Dr. John Hughes and Dr. Tiessen, both of whom are experts in hydroponic research over the last fifteen years and both of whom say categorically it wi 11 not produce at i:he economic level he is talking about.

My question for the Premier is this: If the idea is to develop the technology, if it is an experiment, as the Premier is now saying - by the way, last Friday he was saying it was a production facility - if it is an experimental one to develop the technology then, Mr. Premier, why are all the patents being held by the Sprung Group and why do we not have the rights to anything other than for this particular Province? If we are going to produce the technology and E!Xport the technology surely we should have the right to thE! pate!nts and we should own the research on it.

In fact , a 11 we are doing is putting $12 million in so that Mr. Sprung can do his research on ou1n backs. MR. SPEAKER: The hon . the Premier. PREMIER PECKFORD: Mr. Speaker, I do not know where the hon. member has been the last No. 40 R2111

few days. We have access to all the research material that is going to be done here. That is part of the agreement. We have to have that. Let me just say to the hon. member - MR. TULK : Emperor Brian! SOME HON. MEMBERS : Hear, hear! MR. SPEAKER: Order, please! PREMIER PECKFORD: who normally is a reasonable person, that on this issue I think he is being extremely unreasonable. There are a lot of people around who have vested interests, especially in the agricultural community, in Guelph and other places, who do not want to see this thing succeed _, even in Agriculture Canada.

Now if you go to Agriculture Canada you will get an ambiguous kind of answer; if you go to the National Research Council, independent scientific research, you will get a positive answer. There are some you can select, no question, and have people say it cannot work. The hon. member said that it will not produce. They have produced already and have sold it to the marke ·t place. In six days they have done it to retail outlets throughout all of Western Canada and into the States. It has been done, Mr. Speaker. It is not theoretical.

Two other things I would just address to the hon. member for Menihek One, on the cucumbers and tomatoes it has been proven; therefore it is a bus in e s s . Two , we have also included in the agreement research and development L2112 May 12, 1987 Vol XL on a whole range of other products. So there are two things: It is a business enterprise as it relates to two products, and it is research and development as it relates to another fifteen or twenty, which is incorporated into the facili i:y to do so that we can get into other products later . MR . FENWICK : Mr . Speaker, a final supple~entary . MR . SPEAKER: .

A final supplementary, th e hon . the member for Menihek. MR . FENWICK : My final supplementary is this. The Premier has just said that this is a production organization, based, I guess, on the trials that were done in Calgary. Are we correct about the trials in Alberta? Is that what you are assuming that it is a productive operation based on what went on in Alberta? If that is the case, would the Premier please explain why the circumstances here are so different in the sense that we have no natural gas at a cheap rate for it to use?

He has already said that we are not giving them subsidized electricity, but we have light levels that are dismally lower than what was involved in Alberta and therefore need expensive electricity in order to produce the light . In other words, Mr. Speaker, the situation here in our Province is ~ubstantially different fr·orn Alberta, so I would suggest to the Premier that absolutely nothing has been proven. Would he please explain why he says this is a proven production system when virtually all the factors that are very important in production greenhouse operations are completely No . 40 R2112

different here in this Province? MR. SPEAKER: The hon . the Premier. · PREMIER PECKFORD: Mr . Speaker, number one, it is not completely different. It is not going from black to white, and the hon . member knows that. He is exaggerating. He is using a little bit of hyperbole to pose his question. It is not completely different. We do have some light in Newfoundland and they do have some light in Calgary. Most of the light is on · this side of the House I know, Mr. Speaker, but nevertheless there is light in both places.

It is not darkness twenty-four hours a day here and light twenty-four hours a day in Calgary if you look at their latitudinal position . It has all been looked at, all of the research from Environment Canada on the amount of light and so on. That was the reason why we included in the agreement the high intensity lights as an addition, which they did not have in Calgary. On the price of electricity, there is no subsidy at all. As a matter of fact we have guarantees that Sprung will pay over certain levels and the high intensity is all theirs.

It even has nothing to do with the joint venture company, nothing, zero, no subsidies whatsoever, and protection against even going beyond certain lE!Vels, which they would have to pick up themselves. From all of the research that we have done, metrologically and climatically from Calgary to here to Western Europe and other places, with the high intensity lights this operation can work and be successful in growing those two products. Then part of the deal L2113 May 12, 198 7 Vol XL is to do research and developm ent on a whole range of other ones . It is not crazy. It is a transfer of technology.

We are very proud of it, and . it can work. In the same way as you peoplE! over there told us about three or· four other agreeme nts in the last three or four years, we will prove you wrong again. MR. BAK ER : Mr. Speaker . MR. LONG : Mr. Speaker . MR. SPEAKER: The hon. the member for Gander . MR. BAK ER: I will yield to my colleague, Mr . Speaker. MR. LONG: Mr. Speaker . MR. SPEAKER: The hon. the member fol~ St. John's East. MR. LONG: Thank . you, Mr. Speaker. My question is for the Minister of Health (Dr.

Twomey), and it concerns a situation I have spok en of in the Legislature in the past couple of weeks which :i.s coming to a head. For six years now private ambulance operators in this Province have been consulting with the government and waiting for some initiative on their behalf . They have now ~iven notice that this coming weekend, the long weekend - MR. SPEAKER : Order, please! MR. LONG : they wi11 services if they No . 40 be withdrawing do not receive a R2113

commitment from the minister. MR. SPEAKER: Order, please! MR. BAIRD: Sit. down. boy! MR. SPEAKER: The hon. member is making a speech . I would ask him to direct a question . MR. LONG : My question to the Minister of Health is does he intend to meet with the representatives of the private ambulance operators before Friday of this weekend to prevent a withdrawal of services during the long holiday weekend? DR. TWOMEY: Mr. Speaker. MR. SPEAKER: The hon. the Minister of Health . DR. TWOMEY: Thank you, Mr. Speaker . For the information of gentleman who as ked the question.

I can say that I spoke with the president of that organization last Friday. Prior to that there were meetings with that organization and senior members of the Department of Health. We have outlined in a very careful way what we are going to do if we do not mee!t all the demands to satisfy them. I do not know when we can meet the demands. Thank you. MR: LONG: A supplementary, Mr. Speaker . MR. SPEAKER : A supplementary, the hon. member for St. John 1 s East. MR. LONG : the L2114 May 12. 1987 Vol XL The Minister of Health has refused to take any initiative on this matter.

I would like to ask does the minister intend to give a commitment to the ambulance operators. and hopefully to give that commitment before this IAJeekend. thai: he will be introducing legislation into the House this session to bring in an ambulance act and to address thE ! other concerns that they have been bringing forward concerning safety and finances for the ambulance operators? DR . TWOMEY: Mr . Speaker . MR. SPEAKER : The hon. the Minister of Health. DR. TWOMEY: Thank you. Mr. Speaker .

For your information I have communicated all these facts to the president. that we will bring in legislation. that we will writE! legislation. one; that they will be consulted. two. We wi11 consult with the hospital administrators and with the community ambulance operators. We have committed ourSE!lves to that. And when legislation is introduced there are other things that follow as a result. That I have told them, that I have committed to do. SOME HON. MEMBERS : Hear. hear! MR . LONG: A supplementary, Mr. Speaker. MR . SPEAKER : A final supplementary . MR.

LONG: I would Minister plans. like to ask has the of Health any contingency in the event of a No . 40 R2114

withdrawal of services by the private ambulance operators, to deal with the question of safety on our roads for the holiday weekend? What contingency plans does the minister have? DR. TWOMEY : Mr . Speaker. MR. SPEAKER: The han . the Minister of Health. DR. TWOMEY: Mr. Speaker, obviously we have contingency plans . MR. W. CARTER : Mr . Speaker. MR . SPEAKER : The han . the member for Twillingate. MR. W. CARTER: Mr. Speaker, my question js to the han. the Premier. Mr.

Speaker, a moment ago in reply to a question from the Leader of the other party, the Premier suggested that maybe vested interests were deliberately trying to scuttle in as many words - the hydroponic project because it might be competing with them. The Premier also suggested that this project at some point in time would probably involve other crops, not just cucumbers or tomatoes. Has he given any thought, Mr. Speaker, to the impact?

Let us assume that that company does in fact broaden their scope and start growing strawberries and other crops, has he thought of what effect that might have on the farming industry in this Province? MR. SPEAKER: The han. the Premier. PREMIER PECKFORD: Mr. Speaker, all of the products I L2115 May 12, 1987 Vol XL am talking about MR. R. AYLWARD : We produce 1 per cent of the strawberries that are eaten in the Province. PREMIER PECKFORD: We produce 1 per cent of the strawberries that are 19aten in the Province, the Minister of Rural, Agricultural and Northern Development just said .

All of the products that we are going to be getting into are products that WE! cannot grow in Newfoundland . Green peppers, red peppers, limes and lemons, are they grown in Newfoundland anywhere? Not to my knowledge. They are all brough t in. We will be producing the!m, if the technology works out for those products, not only for the Newfoundland market but for the Canadian market and the American market. So we are not going to interfere with the traditional farming industry of root crops and the things that we can do. Even in those we are not ~~ett.ing near to the market at all.

But it :i. s in those kinds of fields, of r1?.d peppers, green peppers, lime s and lemons where the company wish1 ?.S to do additional experimentation . They have already a lot of experimentation, but they are going to be doing more through this facility . So there is no danger that the farming industry as we know it in Newfoundland will be negatively impacted. There is a re!a l grave danger, a more important graver danger for the hon . members opposite, that we ar e• going to be able to put up other facilities around the Province and in Labrador and create more jobs.

That is the danger, that we might get prosperous . MR. SPEAKER : Order, please! No . 40 R2115

The time for Oral Questions has elapsed . SOME HON. MEMBERS: Oh, oh! MR. SPEAKER : Order, please! Answers to Questions for which Notice has been Given PREMIER PECKFORD : Mr. Speaker. MR. SPEAKER: The hon . the Premier . PREMIER PECKFORD: I wish to table this because questions have been raised on the el e c tri city thing. I want to put it in writing because there are some people in the press who do not believe me unless I put it in writing. I also want to table, relevant to yesterday's question and answer period, the ·quotes from the House Royal Comm~ssion which support what we are doing with the Sprungs.

Orders of the Day DR. COLLINS : Order 23, Mr. Speaker. Motion, second reading of a bill, 11

An Act Respecting The Return Of The Business Of Fishery Products International Limited To Private Investors. 11 (Bill No. 34) MR. TOBIN : Question! Question! MR. SPEAKER: If the hon. minister speaks now, L2116 May 12, 1987 Vol XL he closes the debate. MR . FENWICK: Mr. Speaker. MR. SPEAKER : The hon. the member for Menihek. MR. FENWICK: Mr. Speaker, I am not going to have a lot to say on it because quite frankly. in principle, I disagree with the selling of FPI at this time. That is basically what I am going to be saying today. MR. MATTHEWS: You are against ~verything . MR. TULK: A point of order, Mr. Speaker.

MR. SPEAKER: A point of order, the hon. the member for Fogo. MR . TULK: I know that the member for Menihek has been recognized ·by the Chair but yesterday evening, if Your Honour will recall, the rnernber for St. Barbe adjourned debate and I think he had ten or fifteen minutes left. He was out of thE! House when Your Honour called the bill, so I wonder if the rnernber for Menihek would consent, without losing his place, for the member for St. Barbe to continue hts remarks. MR. FENWICK : To the point of order, Mr . Speaker . MR . SPEAKER : To the point of order, the hon. the member for Menihek. MR .

FENWICK : I have no objection whatsoever to allowing the member for St. BarbE! to finish off his time period, as long as they have no objection. No . 4-0 R2116

DR. COLLINS: To that point of order, Mr. Speaker. MR. SPEAKER: The hon. the Minister of Finance to that point of order. DR. COLLINS: I ~nders tand opposite is House. MR. TULK: that the House Leader ­ asking leave of the Well, I am asking (inaudible.) DR. COLLINS: No, he is asking leave of the House. Your Honour has recognized a speaker and the leader opposite wants to have that changed, so he is asking for leave of the House. Now if the hon. House leader opposite wishes that, I think that he should express it in those terms.

If he does express it in those terms, we wish· to be co~operative, we have always been to-operative. We will quite agree to give leave that the order of speaking be adjusted, because the order -of speaking is already set by Your Honour, that the order of speaking be adjusted to allow the hon. member for St. Barbe to have some concluding remarks. So we would agree to give leave of the House for that purpose. MR. SIMMONS: To that point of order, Mr. Speaker. MR. SPEAKER: To that point of order, the hon. the Leader of the Opposition. MR. SIMMONS: Mr.

Speaker, I submit the issue is a little different than that, if we want to go the route of leave, that is fine, but I submii: to you, Sir, there is another concern L2117 May 12, 1987 Vol XL here. I submit that it is normal in this House for and it has become traditional for Mr. Speaker, when he cal ls an order which been dealt with on the floor in previous days, to inform the House who adjourned the debate. That has been the practice, I think Mr. Speaker will agree, that he has done on occas ion.

Today, unwittingly I am sure, he omi tte!d to do that and proceeded to recognize the first member standing - and that is understandable too - but I submit that had Mr. Speaker drawn it to the attention of the House that it was the member for St. Barbe (Mr. Furey) w~o had adjourned the debate, he was standing right behind his seat here at the moment, right in the doorway, he would have been in his position. I would hope that we could proceed in that particular fashion to allow him to continue his speech. DR. COLLINS : Mr. Speaker, to that point of order. MR.

SPEAKER: To that point of order, the hon . the Minister of Finance. DR. COLLINS: Mr. Speaker, I do have somE! difficulty with the implied criticism of the Chair. ThE! Leader opposite is putting blame on Your Honour that he did not ensure that the hon. member for St. Barbe continued his place in this debate. I do not think it is the responsibility of Your Honour. Your Honour asked for order and and Orders of the Day. The Order of the Day were giuen. Now, it is not the responsibility of Your Honour to scour the corridors asking if someone wants to speak on a particular bill.

He calls the Order of the Day and No. 40 R2117

then hon. members, if they want to speak, stand up, and if they are recognized, they are allowed to speak. I do not want to belabour this too much, Mr. Speaker. Mr. Speaker, if it is by leave of the House, we will be glad on this side to give leave ·for the hon . member for St. Barbe to have a few concluding remarks. MR. SPEAKER : Order, please! To that point of order, there is no point of order. The Chair · recognized the hon. member for Menihek. If he yields, the hon. member for St. Barbe can speak but only by leave of the House. MR. FENWICK: I yield, Mr. Speaker. MR. SPEAKER : The hon. the member for St.

Barbe by leave. MR. FUREY: Thank you, Mr. Speaker. Mr. Speaker, I beg forgiveness of the House for not being in my place when you called that order but I do thank the hon. members opposite and members to my far right for giving me a few minutes to conclude my remarks. Mr. Speaker, I was saying yesterday with respect to the privatization of Fishery Products International that we, on this side, are certainly not against the private sector.

We do not see the private sector as a poisoned place and we certainly do not believe it to be immoral to take a profit where hard work, time and energy is involved, unlike some parties in this House. L2118 May 12, 1987 Vol XL So, Mr. Speaker, what is our problem with moving this huge multimillion dollar fish corporation back into the private sector? Our problem is that we do not believe that there has been sufficient time to allow for a proven track record.

Yes, there were profits last year of $10 million; yes there were profits again this year of $40 million; but we are saying, let us have a five year period where we can examine in succession just exactly where this company is going so as to have the abi 1 i ty to track t:he performance of this company . I know that nobody has a magic wand or a crystal ball and we cannot predict the future; WE! cannot predict fish prices; we cannot predict gluts in the marketplace; we cannot predict TACs for the offshorE! fleE!ts and all of these kinds of things.

What we can do it say to ourselves, 1 Let us lock in for a five year period. Let us check out what that track record will be consistently over that five year period and then let us ease it back into the private marketplace. 1 The socialists would have us believe that it is immoral to deal in the private sector. They would have us believe that there is something wrong with taking a profit out of hard work. That is just so illogical, Mr. Speaker, and we blew that argument away I think fairly successfully yesterday . The Minister of Fisheries in the doorway nods approval.

You cannot have a communal style like that because what happens within those communal styles is that certain layers manage to come to the top. Instead of all pE!Ople being equal we see that all people are equal but some are more equal than No . 4-0 1~2118

others and that is either, Mr. Speaker. not fair Let me return to a specific clause in this restructuring agreement which has given me great trouble since I was first elected two years ago, Mr. ,Speaker, and it is c 1 au s e 1 5 . C 1 au s e 1 5 de a 1 s with the. concept of the Northern Fisheries Development Corporation. The Minister nodded awareness of it yesterday and told rne that he would gladly speak on it in his concluding remarks. To reiterate, there was $15 ' million put on the table. It was $15 million put on the table to be injected into the Great Northern Peninsula.

It was put no the table to help beef up facilities, to help strengthen the North, because the North was, what Senator Kirby referred to as one of the most grossly underdeveloped areas, not in Atlantic Canada, not in Eastern Canada, Mr. Speaker, in all of Canada. The Great Northern Peninsula and the Coast of Labrador was, what Senator Kirby and the other Commissioners called, the most grossly underdeveloped area in the country. So, what happened, Mr. Speaker, between 1984, 1985, 1986 and 1987.

Somewhere along the way, when governments changed hands, the $15 million that was put there by the! previous Liberal Government under Kirby 1 s 11 Navigating Troubled Waters 11 disappeared when the new regime took over, because what was important to them was not people and their lives, and how can we make life better, a little more tolerable in these rugged Northwest Coast conditions - that was not important - but how can we trim this massive · national deficit, and who cares if we trim it on the backs of these people L2119 May 12, i 9 87 Vol XL who hurt the most somewhere that Coast of Labrador and on Northern Peninsula, somewhere Atlantic Canada, somewhere Newfoundland and Labrador. that was the attitude that out of that. on the in in Now, came Mr.

Speaker, what could we do with that $15 million injection from Term 15 of the Restructuring Agreement provided and signed for by the Province and the federal government? Well, let rne tell you. On the Northern Peninsula. the fishery in total accounts For in ex~ess of 135 million pounds of fish. Now, these sta tistics come from the year 19 8 3. The tota1 value of these landings was something over $28.3 million. But there is a sad reality attached to these rather high numbers which look lucrative, which look good for the North because it is such a volume and it is matched with such a high price tag, $28.3 million.

The sad reality, Mr. Speaker. is of this 135 million pounds of fish landed on the Northw(~st Coast and the Northern Peninsula in general, some 65 million pounds, I think. was trucked off the coast untouched. Now, Mr. Speaker, put that is perspective. You know, the people who 1 iv e in the communi ties of St. Paul 1 s and Cow Head and Hawkes Bay and Barr 1 d Harbour, and the Nod:hern sect:ion, Foresters Point and RiVE!r of Ponds and these areas, Mr. Speaker, ·they are not watching transport t r u c k s move fish from the North to the South, move that 65 million pounds of fish along that coastline to other plants.

They are not watching fish being trucked away. They are watching jobs being t r u c k e d away , their j o b s , their resource, their fish from their communities. trucked by their plants. That is not fair, Mr. No. 40 R2119

..... Speaker. There is something fundamentally and morally corrupt about a system that allows a people to go out and extract a resource, in this case fish, to harvest it, to land it, and to watch it being trucked away. There is something wrong with that.

Senator Kirby suggested there was something wrong with that. 'In this new report, 11 From The Ground Up, 11 which is a discussion paper towards evolving a Northern Peninsula fisheries development strategy, which, as I mentioned yesterday, would be an integrated framework for maximizing potential jobs on the Great Northern Peninsula, this new concept has sprung up and has been born and is in place because the Northern Fisheries Development Corporation was ignored. It was a concept designed to help the poorest of the poor and it died on the table, it died in a book.· It is on a shelf somewhere gathering dust. Why?

Because they could not get the finances to make it worthwhile, to make it happen, so that people could take, for the first times in their lives, their own destinies and their own futures into their own hands and make it happen for themselves. So, Mr. Speaker, all of which brings me to this document, 11 From The Ground Up, 11 a document prepared by David Simms who was one of the chief researchers for the Royal Commission on Employment and Unemployment in this Province!. Mr.

Simms has prepared a very valuable document, a document that puts in place the pillars for progress, a strategy designed to help people help themselves. I want to refer to another

section L2120 May 12, 1987 Vol XL of this particular document,

Section 3 (2) talking about increased fish processing. He said, 11 The greatest opportunity for further development in the Northern Peninsula fisheries exists in the fish processing sector. Significant potential exists to increase processing a c t i viti e s by mo v in g forward wi t h existing products toward full-fledged secondary processing and using species which are presently under-utilized. 11 The minister will know that there are all kinds of under-utilized species in the North from male caplin to eels that come down through the rivers up there.

There is an interesting eel catching operation underway now in the Hawkes Bay ar"E!a. The ministe!r will know that there is also a mussel farming operation underway there as well . I think his department, in fact, to his credit, contributed some money towards that particular project and it does look very successful. I want to tell the minister I visited it and it is coming along just nicely. 11 Approximately 50 per cent of existing groundfish products are filleted and sold fresh. 11 Why are we not taking these products and finishing them off?

I had the great fortune of enjoying a cod au gratin recently that was prE!pared, I believe, in Trinity Bay somewhere. Maybe the minister would know about that. Is it Hants Harbour that prepares this or Janes? What a fabulous product! They took the product from its raw s tate to a supermarket shelf. I do not know what the overhead and the costs are. Perhaps the minister will talk a little bit about that. No. 40 R2120

AN HON. MEMBER: (Inaudible). MR. FUREY: That is right. It is fabulous! It is great to see! This is what we are talking about, taking our own raw resources and maximizing the potential for our people everywhere. That is the kind of stuff we need to do and do more of. I say to the minister that along the Northern Peninsula we even have to catch up just in actual fresh fish processing. We are losing all kind of jobs. SO per cent of our fish is trucked · from the .North. I know he is aware of that. Let me conclude, Mr.

Speaker, by saying one other thing about this report. 11 From The Ground Up. 11 It does tie directly into Senator Kirby • s report, 11 Navigating Troubled Waters. 11 because I am dealing with

Section 15 of the Restructuring Agreement and it too has rami fica tions for the marketplace. This study is an integrated organizational framework for the development of the Northern Peninsula fishery. It takes in six development associations, Bonne Bay, Central Development. St. Barbe Development Association, The Straits Development, White Bay North and White Bay Central, and all of these associations come under that umbrella called the Great Northern Peninsula Development Corporation. a quasi-co-operative, private sectqr, hand-in-hand framework.

What we are saying, and wh~t he is saying, and what I agree with, is that we must take our resources. whether it be trees. minerals. fish or whatever, and we must say to people. • It is not good enough just to take it and run. but let us take it and create with it. L2121 May 12, 1987 Vol XL Let us be innovative. Let us maximize and stretch out to the last end every possible job. 1 Mr. Speaker, it is very important that we do that in an area where there are pockets of unemployment as high as 80 per cent. Mr.

Speaker. in conclusion, I know that I only have a minute or so, let me say that we in the Liberal Party are not against the privatization of Fishery Products International. We want to seE! it done orderly over a period of time whereby a track record can be looked upon and we can say confidently, this is a success story. It is not just a blip; it is not just a quick occurrencE! or a knee-jerk reaction. Two years is hardly enough to judge, Mr. Speaker. We make that submission to you, two years is hardly enough. What was profit this YE!ar may be a loss next year. We have to watch the marketplaCE!.

We have to keep an eye on this company and we always have to keep in ~ind that this restructuring happened when it was in thE! private sector . When the private sector lost control of it, when these companies, Fishery Products, National Sea, Nickersons, and al] the rest of them, lost control and went bankrupt, we have to ask, why? Why, why, on all of those questions. Mr.

Speaker, we have to get answers and, once we have answers, we have to look to the private sector and look at this company•s track record and say, •okay, it is good enough, let us ease it back into the private sector. 1 But we do not subscr1be to the socialist view, Mr. Speaker, that there is something immoral about private enterp~ise; that there is something immoral about people working hard; that there is something immoral about No. 40 R2121

taking a profit where sweat has been left in its place. No, we do not subscribe to that kind of social theory, Mr. Speaker, that all people are equal, but some are more equal than others. We do not subscribe to that version at all. So, Mr. Speaker, in conclusion, we will be keeping an eye on this movement back to the private sector. We will be keeping a close vigil. We will be watching, Mr.

Speaker, closely to see how this performance continues, whether it goes up or whether it goes down. · We want the record to · be clear that we would of rather had we had our druthers to see a fiye year proven tract record before it was passed back into private hands once again. SOME HON. MEMBERS: Hear, hear! MR. FENWICK: Mr. Speaker. MR. SPEAKER: The han. the member for Menihek. MR. FENWICK: Thank you, Mr. Speaker . Mr. Speaker, as I said before, we were opposed to the selling of FPI. We were opposed to it because we think it is probably one of the stupidest things this government has done.

Well, actually I said that last week and I take it b a c k . It is now the second stupidest thing that this government has done. The Sprung project now seems to me to have edged it out by a considerable margin. But it is certainly a stunned thing for a government that sits over there and says again and again, 1 We must have control over resources, 1 Mr. Speaker.

L2122 May 12, 1987 Vol XL For a government that says it again and again, 1 We must control our resources, we must direct them with our own, 1 and then to take the largest company in our largest industry that we have some degree of control over and to virtually abandon it to the international financial markets, Mr. Speaker, is the example of the kind of hypocrisy {:hat seems to be corning out of this government over the last number of years. I sugg1:!st to you, Mr. Speaker, that is not p~rticularly good enough for the thousands of people who have worked for FPI. Why are they selling it?

The biggest question which we have is, why is it being sold now? Is it being sold because, after the restructuring in the last couple of years, all the problE!mS of thE! fishery have been overcome, and we are now back into calm waters where things will go on to broad sunlit uplands and all the rest of the expressions that we get out of the orators? Is it because of that? Is it that we have an assured future? Is it that these things are going well? The answer, no. To answer it quite simply, Mr. Speaker, it is because we could get big bucks for it.

That is what the minister said when he announced it, 1 We can get a good market for it. Th1?.re is a good market out there. 1 Well, Mr. Speaker, there is a number of reasons for a good market out there, and I would like to attack them first. What is the first one? An incredible demand for fish in t:he United States and in Europe. Why? Well, because the Americans are food junkies. They are pE!Ople who go on food crazes, food fads. What happened was a study was done on the Eskimos in Greenland and No. 40 R2122

showed a very low incident of heart disease, and they traced it to the consumption of fish. So all the health junkies in the United States are now eating fish. It is gone up a couple of pounds per person over the last number of years . There is a tremendous demand for fish. What is another reason for the increase in the demand for fish? Mr. Speaker, another reason is the Chrynoble nuclear disaster! I ask you, talk about an ill-wind that does not blow somebody some good!

In Europe the consumption of red · meat is dropped like a rock because everybody is quite rightly frightened to death that thE!Y are eating radioactive meat. Of course, I am not sure what happens with all the radioactivity that goes into the oceans, whether it affects fish or not, but the fact is that the consumption of fish in Europe has sky-rocketed -as well. When you are the largest company and the largest industry in our Province and it produces fish, and then the price of fish goes up, as a result your bottom line increases tremendously. But, Mr.

Speaker, have all the basic problems of the fishery been attacked and solved? Is this company going to continue on on smooth sailing? I suggest to you, not whatsoever. What they have done is sold off half their plants. They have a smaller number of plants, although the seasonal all year round plants they have kept. They have also kept the ones with the high level of productivity. In other words, Mr. Speaker, these are the jewels in the crown of our fishing industry that they have kept, the ones that are likely to do the best on a year in, year out L2123 May 12, 1987 Uol XL basis.

That is probably one of the great evils of this particular sell off. We are selling off our best plants not our worse plants. If they were selling the worse ones, well maybe I would not be objecting to it, but to sell all the best ones just has a degree of stupidity to it that is rnind boggling. So what we have, Mr. Speaker, three years after the Kirby Task Force delineated clearly thE! problems in the offshore sector and talked about the problems in the inshore sector, is no real substantial change in it. All WE! have is an increase in the demand for fish, which may continue.

I hope it continues for the next thousand years, but it also may be a bust that next year at this time may drive the cost of fish down so low that virtually our entire industry is cripple~. In other words, Mr. Speaker, somE! of the structural problems with the industry are not solved. It is just a temporary bu bble that we are in, and this is the reason given by this particular government in order to sell it. By the way, Mr. Speaker, I should mention right now that there is an incredible amount of indecision on the part of our Libe rals to the left of us here.

I speak, of course, physically because psychologically nobody is particularly sure where the Liberals are from day to day, but we now haue a remarkable situation. The Liberals are not sure whether they are going to either vote for or against this legislation. They are not sure whether they are for the selling of the operation right now. They have some questions about it. No. 40 R2123

" Mr. Speaker, on another issue, several months ago we raised questions about something that was just as important to this Province and we were shellacked by the members opposite, and the members on this side, because we had questions and we were refused to allow to ask the questions or even to . do any kind of investigation into the situation. Here we have the Liberals in the same situation. Mr. Speaker, I think it should be pointed out that if that is the reasonable thing, fine, but the fact of the matter is, they are in the middle as well.

They have questions and they have no answers to them, so it should be quite adequately pointed out that they are in the same mess, if that indeed is what the situation is. I would suggest that that is. by the way, not a wholly unr:easonable position, not knowing everything that is going on, the!re are some legitimate aspects to it. But I say that because I honestly be 1 ieve ·that doubt. and not knowing everything. is a human condition and it should be respected when you do not have all the answers. Well, Mr.

Speaker, the thing that is worse about the selling of the FPI is the symptom of the attitude of this government. This government has lost its faith in the people of Newfoundland. It has lost its faith that we can do anything - MR. TUL 'K: A point of order, Mr. Speaker. MR. SPEAKER: A point of order, the hon. the member for Fogo. MR. TULK: L2124 May 12, 1987 Vol XL Mr. Speaker, I understand, if I heard the hon. gentleman correctly from the Common Room, that he made the point that the Liberals do not know whether they are against or for this bill. Did he make that point? I believe he did. Mr. Speaker.

If he did I want to tell him 'that when the vote is called he, like everybody else, will find out where the Liberal Party stands on this issue, unlike the hon. gentleman who sat in his seat and got ejected. It has not been said in this House whether we are going to vote for or against the bill. When the vote is called, unlike the hon. gentleman. we wi 11 rna k e o~r point quite clear. We will not sit in our SE!at and abstain and get kicked out of this place. MR. FENWICK: To that point Speaker. MR. SPEAKER: of order, Mr . To that point of order, the hon . the member for Menihek. MR.

FENWICK: I do not think I have to say ·anything to it. Would you please rule it out of order so I can get on with my speech? MR. SPEAKER: To that point of order, there is no point of order. The hon. the member for Menihek. MR. FENWICK: Thank you very much, Mr . Speaker. Why are we against it? First of all, it happens to be the largest company in our largest industry and we feel, truly feel, unlike the sham feeling that we arE! getting from the Tories opposite, that we should have control of our major resources and our rnaj or No. 40 R2124

industries. We believe that it is important to have an equity interest in it. What we have said, as it is being sold, as soon as we form a government in this Province, we will buy back the 26 .2 per cent interest that we threw out and get it back so that we can do something about making sure that we have some sort of input into that particular organization. Mr. Speaker, why do you want control of that industry? Why do you want an input into it? Well, Mr. Speaker, you want a window · into it. You want to be able to see what is going on in the industry in a hands on way. You want to know what the markets are like.

You want to know what the problems are. That window, which is the same argument put in for Petro-Can, one of the great Crown corporations that Canada has ever produced, that same argument is a legitimate and logical argument for here with our biggest company and our biggest industry. At the same time, Mr. Speaker, we have another aspect of it that has to be addressed and that is the influence on the several hundred communi ties in this Pro vi nee that have fish plant operations and places where they land fish.

These operations are truly at risk with the privatization of FPI. - As long as FPI had a social side to it, as long as it had· two levels of government owning shares in it, its predatory nature was curved, so to speak. It had to operate within legal bounds. Mr. Speaker, that is gone now. The marketplace is, by its . very nature, a competitive one. It has often been described as a jungle where the survival of the fittest is the only thing that goes on. L2125 May 12, 1987 Vol XL Well, Mr. Speaker, through the money that we have given this company and the way it has been set up, it is an extremely fit animal indeed.

That: animal, I would suggest to you, will be a major predator on the other fishing companies in this Province. It will end up, in the long run, to be at thE! detriment of all the other companies whe!re it operates. Decisions it would make would be primarily bottom line decisions on whether it is profitable or not. The other arguments I advance for not abandoning it now is the fact that there are so many lost opportunities that have occurred as a result of this. We have a situation, Mr.

Speaker, where FPI, because of its strength and its size, could have been a marketing arm, worldwide, for all the fishing industry of this Province. It could have done that function for the other 175 fish plants or so that exist in the Province and do not. have thE! expertise to develop markets all through the country. That is abandoned . That is gone now. We are not going to SE!e that again. As a result, when the market drops down, as it inevitably will at one p o :in t , a 1 o t of t h "~ s e s ma 11 companies will close up and people will lose their employment as a result of it.

The markets that WE! want to develop all over the world will not have been developed. Mr. Speaker, that is a tremendous shame. Another area, Mr. Speaker, that FPI should be moving into, however tentatively at the beginning, is in the fantastic industry that produces the machines that process fish. Right now we buy them from Sweden and West Germany and other countries in the world. We No. 40 R2125

produce virtually nothing of the high tech materials ourselves. With a company like that, we would be in a position to start looking at the production of the production machinery, to go into the linkages, the reverse linkages and forward linkages. That goes with this company, and if we want to do that in the future we have to 'look at other vehicles for it. But it is obviously an opportunity that has been lost by the short-sighted actions on the part of this provincial government. So, Mr. Speaker, those are the reasons we are against the selling ­ of it, to b.e as quick as I can on it.

Let us look at what the government has put in place in order to protect it. Mr. Speaker, the government has put in place a restriction of 15 per cent on share capital. Well, they should go and talk with Conr~d Black. Conrad Black and Argus Corporation has gotten control of Dominion Stores with less percentage of the shares of it. It has control of a whole bunch of other companies with much lower than 15 per cent interest in it. Mr. Speaker, we are still very vulnerable to somebody who comes in from Canada Packer·s or some other organization and buys 15 per cent.

At that point, we are starting to look at the end of any kind of control at all, any vestage of it that the Fisheries Minister says still exists. Mr. Speaker, what about the Board of Directors? Fifteen members on the Board of Directors and the legislation says a majority must be residents of this Province. We have had the minister himself, when he introduced this bill, stand up and say that the legal opinions are divided on whether or L2126 May 12, 1987 Vol XL not that is constitutional.

I would suggest to you that if he says the9 are divided, what he is saying is the lawyers are telling him it will not work, that if there is a Newfoundland resident on the Board of Directors now, like Harry Steele, for example, or Collingwood or Crosbie or whoever these people are, and they decide that the grass is greener in Halifax or in Vancouver or in the Bahamas, wherever, and they move and they attempt to remove them from the board, I would suggest: to you that as long as he moues within the country, the economic unit, there is not going to be any way whatsoever to stop him from moving.

Eventually, the Board of Directors, Mr. Speaker, could be totally dominated by non-residents. The othE!r _thing is: What is thE! definition of a resident? That is a part that we have not even discussed yet, because the minister has not even told us what the criteria is. He said something about, 1 Well. if hE! is eligible to vote. 1 I think t:hat is thirty days in the Province. In that case, if he stays for thirty days here in the Summer, lives the rest of the time in Florida for ten months of the year, that is a Newfoundland resident. I am not entirely sure how residen ·t that resident really is.

But that is bE!Side thE! point. It shows, Mr. Speab~r. the kinds of filmy cobwebs that are trying to be used in order to give the appearance, because th~t is all it is, the appearance that there is some control over this organization in this Province. The fact is, Mr. Speaker, there is no control whatsoever. We have sold it off and this animal is going to do what it wants and that will be primarily to maximize its profits. If our interests are No. 40 R2126

well served, it will be completely a miracle. Mr. Speaker, the worst thing I see in this is there was an opportunity to do things here. I want to put forward at least one particular way in which I thought it should have been done. There have been organizations elsewhere that have insisted on maximum ownership, like Western Pacific Airlines when it was sold by the Alberta government. Instead of saying that there be a little of an edge for Newfoundlanders, Albertans in their case, they · mandated that 40 per cent of the shares had to be sold in Alberta and 40 per cent were.

Of course what we ended up with here, Mr. · Speaker, is about 11 per cent being owned within the Province. I am not sure if that is good, bad or indifferent but certainly, if it was 40 per cent or 50 per cent owned within the· Province, we would have a feeling that there was some sort of ownership claim to it as well, but now with over 80 per cent or 85 per cent of it being owned outside the Province, then we are in a severe situation where we do not particularly own it.

Other models that you could put forward, there have been worker co-operative organizations, not necessarily totally owned by the worker cooperatives but with a dominant interest. Why not take 50 per cent or 51 per cent of the shares, put the!m in a corporation that then it is owned by the people who work in the plants who are the inshore fishermen or the trawlermen? Why not have them have some direct say in what is going on? Mr.

Speaker, it is not owned by the Province anymore or by the federal government but at least, at the same time, it is L2127 May 12, 1987 Vol XL controlled by the people who have the biggest stake, the people! whoge jobs are depended on the organization, the communities that Fishery Products International operates in. Mr. Speaker, what it j.s is a symbol of the lack of faith of this government in ·the people of this Province. The selling of FPI is part of a pattern.

It is a pattern that has been repeated by the incident down in Elay d' Espoir where National Sea tAias brought in in order to do the first commercial fish farming in t:he area. Mr. Speake!r, it was an example of a loss of faith in ordinary Newfoundlanders and it is completely typical of the way in which this government operates. They have lost the faith that they should have in the people of this Province. Mr. Speaker, I have got in front of me a whole bunch of junk from the Premier {:here saying that the massive greenhouse project is in line with the House Royal Commission.

In that case, he has not read it if he thinks it is in line because the House Royal Commission said one thing, it said have faith in the peoplE! of Newfoundland! Have faith in the initiative of rural Newfoundlanders! That is completely against it, Mr. Speaker, and so is the selling of FPI, so is the National Sea deal on the South Coast by allowing one large corporation to go in there and develop the first of the fish farming. Mr. Speaker, the Sprung gree!nhouSE! project is another example of a lack of faith in Newfoundlande!rs.

There is a possibility for a greenhouse industry in this Province, but it is not this kind No. 40 R2127

of thing. Mr. Speaker, I absolutely guarantee you they will grown tomatoes and cucumbers in the Sprung greenhouse, I know they will, just as they will be able to deliver tomatoes and greenhouses to market in a cadillac, but who would do it? It is crazy. It is senseless. It is stupid. You take a truck and you deliver tomatoes and cucumbers to market. You take an appropriately economically designed structure in order to produce it! You take operators who have been there for decades and know the problems!

You do not take some fly-by-night · fellow who has only been producing them for a year and a half to two years and all his tomatoes died! You do not go and give them an operation like this where there is tons of money in it but it is a symptom, Mr. Speaker, of the same kind of lack of faith in Newfoundlanders to develop their own future, as the FPI sale is as well! It is part of an entire pattern and, Mr. Speaker, that is the reason it is wrong. But, it was not invented by the ~ahoos opposite, Mr. Speaker, it was a tradition that has gone back to about 1900.

When the A & D Company set up the mill '.in Grand Falls I we started on the path of putting in foreign capital and foreign expertise to develop our Province, our country at the time, and we have continued on with it ever since! The Bowater Company, the Kruger operation I virtually every mine we have ever had, has always been foreign money. There has never been any faith whatsoever that we could do anything and, Mr. Speaker, I am not surprised when they go and sell our major resource because they have never had any faith in the Province. Why should the manifest it now? L2128 May 12, 1987 Vol XL So, Mr.

Speaker, we are foursquare against thE! selling of FPI! WE! are foursquare against the privatization of the operation! We believe that in years to come it will become manifest that it was a stupid idea on the part of the government of this time. When we have to go in there a year or two or three years from now and bail out the whole operation again and restructure it for the Nth time and this time we will be putting the money into capitalists all over the country. So, Mr. Speaker, it is a lousy idea and we are against it . MR. LONG: Hear, hear! Well said, well said . MR. SPEAKER: Order, please! MR. GILBERT: Mr.

Speaker. MR. SPEAKER : The hon. the member for Burgeo - Bay d 1 Espoir. MR. GILBERT : Thank you, Mr. Speaker . SOME HON. MEMBERS: Oh, oh! AN HON. MEMBER : Foolish, Russian friends! MR. SPEAKER: Order, please! Could we have order on my left side please? The hon. the member for Burgeo - Bay d 1 Espoir. MR. GILBERT: Thank you, Mr. Speaker . No : 40 R2128

SOME HON. MEMBERS: Oh, oh! MR. WARREN: That is right, you do not know. You do not even know yourselves. MR. SPEAKER: Could we have silence please? The hon. the member for Burg eo - Bay d 1 Espoir. MR. GILBERT: Mr. Speaker, it is hard to talk when you have to listen to this. Mr. Speaker, there is no doubt about my position on the privatization of FPI. I think the hon. gentlemen to my physical right and political left will have no doubt about my position on the privatization of FPI. My concern, Mr. Speaker, is why are we in such a hurry to do it.

I have talked to many people, accountants, and people involved in business. I have been involved in business in Newfoundland for the last thirty years so I have some ideas about how to run a private business. The concern that I have is that the government moved too quickly on the privatization of FPI. That is the situation, Mr. Speaker, that has happened here. We find that again the government rushed blindly into something without giving it the thought that they should, and I feel that they will live to rue the day again that they have acted so quickly.

The principle oF privatization was certainly there right from day one when the Fisheries Restructuring Agreement was signed. I am sure that everybody in Newfoundland who was clear thinking was looking forward to the day when Fishery L2129 May 12, 1987 Vol XL Products International would be again privatized. But, after a track record like the one that we have seen from FPI, I have some grave reservations about privatization at this time. Two years ago this same company that we are so proud of right now lost $40 million. One Y•~ar ago it lost $20 million. Last year it made a profit.

We have heard everybody talk about the reasons for the profit, the increase in the market in the United States, the dietary habits changed in the United States, and, of course, there is another thing that we, in Newfoundland, should be only too aware of that caused FPI to show a profit last year. It was the fact that the world price of oil droppe!d rather drastically. As I understand, a lot of _this $4-0 million is reflected in thE! drop of the world price of oil. ThE!Se are the concerns that I have.

All of a sudden, one year of success and the company is now a success, not because of anything that management had to do. I am not saying that there was not adequate management. Maybe there was but there is nobody knows for sure if this management had the expertise to turn this company around 1 because it was situations outside of their control that caused a profit last year, as I have already said, the drop in oil prices which, you know, had some drastic affects on the economy of Newfoundland and otherwise. But, what is bad for one thing is good for another.

Fishery Products International made a profit last year because of situations that management had no control over. It was not management decisions. It was not the sound management of that No. 40 R2129

company that made a profit last year. It was world situations, Mr. Speaker. That is the thing that I am very concerned about when I see this company sold off this year. I am a little bit concerne'd about the way it was done. I would have li~ed for more shares to have been made available to Newfoundlanders. I think this was one of the things that t:he members opposite and the government were remiss in, not making more shares available to Newfoundland and Newfoundlanders in the event that ­ we a 11 hope wi 11 happen , that it will be a success.

I think that the ordinary Newfoundlander who has suffered at the hands of big business all his life, particularly the inshore fis herrne'n. · The down trodden inshore fishermen in Newfoundland have suffered because of an economic system that has · been set up in Newfoundland. He is the fellow who should have been given the chance to buy more shares. This is the type of person who should have been given the opportunity to invest in a company which members opposite now say is going to be a howling success.

This to me is what we, all members of this House, I am sure, want to see happen is that Fishery Products become a success I all except the members to my physical right and political left. They would not want to see it become a success because the only thing that they would like to see become a success is something that the government is in, and something that they have their dirty red hands in I and something that never worked. Everyone is aware of the economic philosophy of our members to the right of me there, and left in their political thinking.

They L2130 May 12, 1987 Uol XL are not concerned about anything beling a success, because they have discovered that you print money and that solves all the economic problems in the world. Let them print their money. I suggest they should look at Russia sometime if they think that their situation is as successful as they would leave us to believe when they talk about government involvement in business. But I am concerned abo-ut the fact that there was not enough s hares made available to · ordinary Newfoundlanders.

I have another very serious concern about the share package that was offe,re'd at the sale of Fishery Products International. I am concerned about the number of shares that were made available to the management people at Fishery Products International, the options that were made available to pick up shares at the price. as of April 15 this year. This I am very concerned about. I again, believe me, feel management should be rewarded for a job well done. Somehow I feel that the reward that was offered to the management people of Fishery Products International was a 1 it tle too much for the work they had performed.

As I pointed out when I started, Mr. Speaker, management had very little to do with the success that was shown by Fishery Products International in the three years of its operation. As I said, the success was really not there when you had two yc::~ars with horrendous losses and then we have one year that showed a profit because of a condition, a turn around in the world market for fish, and a drop in the world price of fuel oil. All of a sudden this government, in its generosity, decided to No. 40 R2130

reward the top management of Fishery Products International by leaving an option to buy a block of shares at any time down the line. As I understand it, the Premier said in this House that there was no time limit on the option for these senior mana~ement people of FPI to pick up their shqres. This to me, Mr. Speaker, is wrong. I consider it to be unfair, unjust and again I feel that Newfoundlanders are being ripped off because of the attitude and the ideas put forward by the government. Remember that in the sale of Fishery Products International, Newfoundland taxpayers subsidized the sale.

There was a loss in the price that was realized for the privatization of Fishery Products International. This is on the backs again of the Newfoundland taxpayers and I think it is unfair that the senior management, who were lucky enough to be there they might have all the skills of management, we will find out one of those days - but the fellows who were lucky enough to be there for the last three years and were a b 1 e to t a k e ad v an tag e of a wo r 1 d situation when this company showed a $40 mi 11 ion profit without any management skills having to be used, Mr.

Speaker, now we see those people, and for sometime in the future, if Fishery Products International is the success that we all hope it is going to be, this small group are going to make, again, a whopping profit, a tremendous profit without really putting any investment in. Remember, the management people in FPI are people who worked with government most of their lives. They have never really put to much effort into business in NeiAJfoundland and were fortunate to L2131 May 12, 1987 Vol XL be running a company that had been taken over by the government.

They put their own people in, so to reward them with this kind of an award, I think, it unfair to Newfoundland, Newfoundlanders and the taxpayers in Newfoundland, the people who underwrote the loss that was realized in the sale and the privatization of Fishery Products International. This, I think, is a crime and a shame, Mr. Speaker. I think the scheme is one that should not have been put ih place until such time as we were sure that in a few years time we are not going to have to put Newfoundland taxpayers back into the operation of FishE:!ry Products International.

The one thing that we have found now and we see in the comments relative to the changes that the government put out is a realization that there. · is a problem and a problem could develop that some of the plants that were designated as social plants in the restructuring of Fishery Products International. They are still in the private company Fishery Products International, mainly the ones on the South Coast. We know that some of the fish plants were sold but we know now that thirteE!n or fourteen were left.

I know in the Fishery Products International magazine, which carne out in December or January, they said that all the plants they had h~ft now were equal, first among equals. The word social plant was not going to be considered anymore and now you had every plant equal, all of them vibrant and successful. The only thing about that we are into a si t.uation is a private company. fish plants, and we can No. 40 is again where it. We have take thE! R2131

one in Ramea in my district, where there are serious problems with supply. We all knew about the problems with supply in January or February of this year when we heard of French over fishing and the cutback of 10,000 metric tons in our quota for this year. We all knew about supply at that time and we all knew about the serious problems along the South Coast. The strange things about that, Mr. Speaker, is we have not heard much about French over fishing for a few months now.

It sort of died away when the polls said that it was not a good time to win an election maybe, or it was not an issue on which we could win an election. Maybe that was the reason why it died away. But, Mr. Speaker, I would like to point out that the French are still over fishing. St. Pierre is still there. It might not be Metropolitan French right now but remember that St. Pierre has seven or eight wet fish trawlers that are out there right now. They are fishing and at the rate of 5,000 metric tons a year from each trawler. It does not take long to do the job on the St. Pierre Banks and the Gulf of St.

Lawrence where the fish from the South Coast plants are coming from. FPI is now a private company again. We all know that in business efficiency is one of t:he things that we have to look at, So the plants that are nearer to the source of supply, and thE! supply is Northern cod right now, those plants that are on the East Coast are much nearer now than the plants on the South Coast.

Another thing that has happened on the South Coast this last year, and I am sure the minister is L2132 May 12, 1987 Vol XL aware it, is the size of cod fish that are landed on the South Coast has dropped by two inches, the average size of a cod fish has dropped by two inches. Last year it used to take thirty-eight cod fish to make a hundred pound from the cod fish that they were bringing in from 3Pn and 3Ps in the Gulf. Right now it is taking forty-eight fish to make that same hundred pound. So I can assure you, Mr.

Speaker, that if FPI is privatized and it is a business, you are go:Lng to be looking at thE! efficiency of the operation. The government over there is well aware of the efficie!ncy. I talke!d to the Minister of Energy (Mr. Ottenheimer) in the Energy Committee on Thursday morning, and one of the points that he made to me, Mr. Speaker, is that they were moving the control centre for Newfoundland Hydro out of Bay d 1 Espoir, and they were moving it out, Mr. Speaker, because of the fact that it was more efficient to operate it from St. John's.

He did not tell me that they were going to save any more money because this is a Crown corporation, and they really do not have to save monE!Y, th:i.s is a Crown corporation. But, he said that Crown corporations did operate like a business so they were moving jobs out of Bay d'Espoir to bring them into St. John's to make it more efficient. He aJ.so said that they could have that control centre in Halifax, but it would not be as efficient, but he could have it.

But he did not tell me how much money he was going to save the Newfoundland taxpayer, how much lower our hydro bill was going to be by moving those jobs out of Bay d'Espoir. When we have government thinkin~ No. 40 R2132

like that, just imagine, what is going to happen to a private company when all of a sudden you find the serious problem that we have known for years and years has been there, the overfishing on the St. Pierre Banks? Overfishing has gone on all along the South Coast in the main source of supply for .thqse plants on the South Coast. When all of a sudden this becomes a problem, what is going to happen to the plants on the South Coast? I am sure the Speaker is well aware on how dependent the plants on the South Coast are on the fish that comes from that St. Pierre · Bank and the Gulf.

To run a private business and private business FPI is again now, even though the Newfoundland taxpayers underwrote the privatization again, we know what is going to happen, Mr. Speaker. There are going to be serious problems in those South Coast plants unless the government is prepared to do something irrmediately. The French overfishing cannot be let to go away now that it is not a threat for an election. They know that it is not a reason to call an election any more, but French overfishing is still a problem, Mr.

Speaker, and it is one that this government has to sit down and come up with a solution to in conjunction with their counterparts in Ottawa. My feeling again is that the government jumped, members opposite jumped into this as they have in so many things without really putting any great plan into place to look at the future and just say, 'We have a chance now to bail this out . Let us get out of it. let us give our friends a chance to make sorne money and let us go. ' L2133 May 12, 1987 Vol XL I think of some of the other projects that this go~1ernment has sponsored.

The aquaculi:ure one in Bay d'Espoir has been going on for five years. We are down to the point that it should now be about ready to go into production, and yet the government cannot make up its mind as to which way it should go. This again is something that should have been done two years ago, Mr. Speaker. The plan should have been there and the risk money made available to Newfoundlanders who wanted to get involved and invest in this to make aquaculture a vibrant part of the economy of Newfoundland. Now we hear of hydroponics. Again I feel, and we feel, that the Premier is grasping at straws.

He is jumping into something very quickly hoping against hope that he can convince the people of Newfoundland, 'Yes, he has an idea, a vibrant idea. ' I do not think that Newfoundlanders will be fooled by that. Again, it is thE! type of attitude that this government has. It is the kn(H! jerk form of government . You know, 'What can we do today to try and let the people know that we have a plan for governing?' As I have said rnany times in t:his House, I think that government has lost the will to govern. They were elected to govern but they have lost that will.

I think the privatization of Fishery Products at this time is a part of the lost will to govern. I agree Fishery Products International should have been privatized. I am asking, 'Why so soon?' It should not have been done at the present time. It should have been given a chance to prove itself in the market with a proven track record. Not just one year of a profit when they ·had no No. 40 R2133

contra 1 over the conditions. The management of FPI had no control over what happened last year. I think again a knee jerk reaction and a government without a plan. In that, Mr. Speaker, I feel that there are serious problems and I think that this government has jumped into a situation again without planning. We just heard the Premier last week come back from Otfawa and say that he now felt as if he were almost a Canadian. We w·ander why he said he was almost a Canadian. He had been to Meech Lake and he had heard that the Constitution was now finally going to be solved and we were all going to benefit from it.

I do not know if that is going to be true or not, Mr. Speaker. I am of the strong opinion that Newfoundland is best protected in Confederation when we have a. strong central gqvernment. I do not think that with the Constitution that has been amended and talked about at Meech Lake, that they are going to hold a meeting early in June of the Premiers and the Prime Minister, that Newfoundland's interests are going to be protected. I think again it is another form of a knee jerk reaction.

Anything to change the peoples' minds; anything to get the peoples' minds off the real problems that we have in Newfoundland; let us give them cake because we really do not have bread to offer. He came back and he talked about how he finally felt that he was now half a Canadian. One of the reasons why he said he was half a Canadian, Mr. Speaker, was that now he says he has control. Finally, the federal government is going to discuss giving Newfoundland control of the fisheries. Finally, after SOO L2134 May 12, 1987 Uol XL years, Newfoundlanders are going to control their own destiny.

I heard that before when we were talking about control of the off share and ownership of the offshore. You notice that these words disappeared in the Atlantic · Accord which was signed. It was put aside because the Premier went to court and lost his case there. Now he is saying that he is going to have control of the fisheries. Our destiny is finally going to be assured. The only thing about it, Mr. Speaker, is he did not say, by my reading of thE! comments that carne out of Mt~ech Lake, is t:hat evE:~ry province will have a veto as to who has control.

The other thing about it is that I understand Nova Scotia is dead set against any discussion whatsoever on control of the fisheries. I would think the Premier again is a little premature when he is talking about control of the fisheries. Finally, Mr. Speaker, if he was going to get control of {:he fisheries, there is another little interesting comment we might make. Good God, how fast does time goes. But there is another little interesting point that we could make, Mr. Speaker, when we talk about the Premier finally feeling like he is half a Canadian.

We wonder where the money would come from if the Premier was to get control of the fisheries. Where would the money come ftom to exercise this control? It is a great pipe dream, you know, sort of likE! hydroponics. We can now have control of our fisheriE!S, but control of anything, Mr. Speaker, I submit to you, means that you must have the wherewithal to do it. I have some grave doubts about the ability of Newfoundla11d No. 40 R2134

at this time to be able to control their destiny as far as the fisheries is concerned because it is going to take money. Now, within the last month and a half we have heard the Premier first get up and say that Newfoundland was almost back to the thirties, back to the depression days. We were broke. Then we heard the Minister of Finance (Dr. Coll:lns) come in with the kick-start budset, which was supposed to solve all our problems. That was going to be the thing.

In this new spirit of Confederation they were going to go to Ottawa and with every project they had up and really get down and work with Ottawa in developing a partners hip that was going to carry Newfoundland forward into the twenty-first century. MR. TULK : (Inaudible) loved that. MR. GILBERT: That was a month and a half ago, a month ago. The only thing about it, Mr. Speaker, is now we see another example of the kick start budget. We heard the Premier stand in this House last week and announce that he was going to spend $16 million or $18 million.

It really does not mean much to the Premier when he is talking about spending it, and obviously he has a reason for it. I do not know if an election had anything to do with it or the thoughts of an election. It is like Christmas, dreams of an election or maybes and maybe he can fool the people again that he is going to create 120 jobs, or 300 jobs in construction. The only thing I say to the Premier, well, first of all in his L213S May 12, 1987 Uol XL kick start budget he went a little bit askew. He said he went to Ottawa but they turned hirn dou.m, so now he is in it on his own.

The other thing I say to the Premier about his hydroponic industry is that the people out there in Newfoundland, the people in rural Newfoundland are a little concerned when they see an industry that is announced again for St. John 1 s or environs when, again, it is against everything that was ever said in the Royal Commi s s io ·n that the Premier as kc'!d to have instituted two years ago when he went out to try and fool the people again. He wanted to form the government because he was going to create jobs.

He creatE!d this Royal Commission which was supposed to solve our problems, yet this royal commission came back and recommended a decentralization outside of St. John 1 s of jobs. Then we hE!ard him announce this super hot house, or super greenhouse project for St. John 1 s, to create 120 jobs in Mount Pearl. Now, Mr. Speaker, we a11 know if there is any bright spot in Newfoundland it is in St. John 1 s. The Minister of Ottenheimer) talked week and he told reason that he took - MR. SPEAKER: Order, please! Energy to mE! me that (Mr. last the The'hon. member 1 s time has elaps1?.d . MR. GILBERT: In conclusion, Mr.

Speaker . MR. SPEAKER: Do we have leave? SOME HON. MEMBERS: By leave. No. 40 R213S

MR. SPEAKER: By leave. MR. GILBERT: I heard the Minister of Energy tell me last week that the reason that he took the jobs out of Bay d 1 Espoir was to make it efficient. I have a feeling, Mr. Speaker, that this government feels that it would be very efficient if they moved everybody outside of St. John • s to the Avalon Peninsula, and they let thE! fishermen go out for two weeks to fish, and they let the miners go out for two weeks to mine and bring them back to St. John 1 s. It would be much more efficient. I believe, Mr. Speaker, that that is the policy of this government.

Again I say, a knee jerk reaction to a government that has lost its ideas and its will to govern. MR. RIDEOUT: Mr. Speaker . MR. SPEAKER: If the hon. the minister speaks now he closes the debate. The hon. the Minister of Fisheries. MR. RIDEOUT : Thank you, Mr. Speaker. Mr. Speaker, let me begin by thanking all hon. members who participated in the debate for their contribution on Bill 34, the act to return FPI to the private sector. By and large, Mr . Speaker, I think it can be said that the comments and the observations of hon. gentlemen were worth-while. It certainly was, I believe, beneficial.

Even though reservations were expressed and legitimate questions raised, to a large extent I think it is fair to say that the comments wer~ not all that derogatory towards L2136 May ,12, 1987 Vol XL the company and the privatization process as such, especially in terms of the official Opposition. I will try to respond in as much detail as time will permit to each of the issues raised by the various members who spoke over the last three or four days in this debate. Let me first of all start off with the comments from the socialist group down in the corner, because their comments, Mr.

Speaker, in the context of the Opposition comments, which were pretty intelligent, down to earth . good debate on the issues related to p r i vat i z at. ion , b u t the co rnm e n t s from the socialists, from the NDP, were dogmatic in nature, Mr. Speaker. It is not a problem of privatization as far as the socialists are concerned, it is a problem of philosophy . It is philosophy, it goes to the de!pths of their soul, Mr. Speaker, that you must control everything as a government, there is no room in this society for private enterprise, there is no room in this society for profit, profit is a dirty word, Mr-.

Speaker, in the socialist context, there is no such term as clean profit in {:he socialist grammar and that is their problem. Mr. Speaker, the hon. gentleman for St. John 1 s East (Mr. Long) even went so far as to say - and God forbid they ever form the government, whether it be in l:he year 2 500 or in thE! YE!ar 3 500 or whenever it might be, but it certainly will not be in this century or in the next number of decades - •when we form the government of this Province FPI will be brought back under government ownership. • Now, Mr. No. 40 R2136

Speaker, that is an irresponsible comment from an irresponsible gentleman. Just let your imagination run wild and think that for some strange reason the electorate of Newfoundland and Labrador might place their trust in that kind of irresponsibility, let your imagination run wild and dream that that could happen: How wo u 1 d y o u go abo u t doing it , M r . Speaker?

He!re is a company with shares of $177 million just sold to the private sector, 20-odd percent of whom are Newfoundlanders, by the way, who never had a chance to participate, · according to the hon. gentleman, with $7 million worth of shares given to his union buddies free gratis, a gift, Mr. Speaker, which today is worth $11 million in cool cash. That is the dirty profit, Mr. Speaker. SOME HON. MEMBERS : Hear, hear! MR. RIDEOUT : Mr. Speaker, have you heard a fish plant worker from Ramea or a fish plant worker from Marystown or one from Port aux Choix saying, 'I do not want my $11 million worth of shares'?

Have you heard them, Mr. Speaker, say that about their free shares, paid for by the taxpayers of Canada and Newfoundland and by the sweat and blood and productivity of those people who worked in that company? That is who he is slapping in the face, Mr . Speaker, the 8,000 workers, the 8, 000 men and women who make up the corporate family called FPI. That is the dirty word profit that he is talking about, those people who had $7 million worth of shares given to them that today are worth $11 million in cool cash. Did he talk about the ·profit L2137 May 12, 1987 Uol XL sharing programme, Mr.

Speaker, that the unionized employees of that company have? Did he degrade that? Did he say there was any discontent or malcontent in Marys town, Ramea or Gaul toi s because 10 per cent of the profits of this company are given directly to the employees of that company? Did he talk about the subsidized share option plan whereby i:he E!mployees of the company can buy further shares through pay roll deduction, subsidized 10 per cent by the profits of the company? Oh, the dirty word 'profit', Mr. Speaker, shines out of the hearts of the socialists . Now, that is there position. Their problem 1s philosophy. MR.

TULK: That is their position today . MR. RIDEOUT: That is their posi tion today. They will vote on this Bill, I project, Mr. Speaker. I suspect they will stay in the House and vote on this one, but they w1ll not vote on 1000 or 2000 jobs for Goose Bay or s orne other part of Newfoundland and Labrador. They tJJill vote on this one because it fits their dogmatic social philosophy.· That is why they will vote on this one. But, let us go back, Mr. Speaker. You have not heard too much in the way of malcontent and discontent about that great socialist Richard Cashin on this privatization deal, have you, Mr. Speaker?

You have not heard much discontent, you have not heard much public debai:e, you have not heard much ranting and raving about that great Christian socialist Father Des McGrath, on this privatization deal, have you, Mr. Speaker? SOME HON. MEMBERS : No. 40 R2137

Hear, hear! MR. RIDEOUT: No, Mr . Speaker. and the malcontent of the socialists, Mr. Speaker, of Newfoundland and have now - SOME HON. MEMBERS : Hear, hear! MR. RIDEOUT: The dis content is in the minds the communists, . politics in Labrador, who made it a plank in th(~ir political platform to take to the people of Newfoundland and Labrador - it is in the records of this House now - that as soon as they become the government - about the year 3095 - they are going to buy back the shares. Are they going to buy them back, Mr. Speaker?

There was $177 million worth on April 15 and today i ·t. is well over $200 million w_orth, Mr. Speaker . In the year 3095 they might be worth $2 billion. Are you going to buy them back through the taxpayers' dollars? Are you going to expropriate? That is the NDP philosophy, Mr. Speaker. The han. Leader of the NDP then gets up with such righteousness and he says that control is the argument. Control, Mr. Speaker, is the essence of stupidity. A company that the taxpayers of Newfoundland and Labrador had 26 per cent control of and the han.

Leader of the NDP gets up and says because you returned it to the private sector with a share restriction, with a guaranteed gift of $7 million worth to the employees, with purchase benefits, with all of that, you committed that crime of returning it to the private sector · and you lost control. Mr. Speaker, the esselnce of stupidity! We control the processing sector of the fishing industry of this Province toda~ L2138 May 12, 1987 Uol XL just the same as we did yesterday and just the same as we will tomorrow through the constitutional legitimacy of this Legislature.

Part of the constitutional legitimacy of this Legislature is to control the processing sector of the industry in this Province. But because we own 26 per cent of that company could we somehow or other control the quotas? We never had that constitutional right even with 26 per cent of the company. If we had expropriated the Government of Canada 1 s shares and owned 100 per cent of the company we still would not have the right to control thE! quotas. We would not have the right to say to FPI that you cannot fish anymore in 3 L or that you have to go .to 3J.

These arE! management decisions, control decisions that we have some imput into as a Province of Canada, but no control over and never will have any control over until there is an legitimate constitutional amending process in this country to give this Province legitimacy in the fishery. So much for the stupidity of the socialists, Mr. Speaker, from St. John • s East and Menihek. MR. WARREN : Are you ~earning anything? MR. SIMMS: A good job. SOME HON. MEMBERS: Hear, hear! MR. SIMMS: Do not slack off now. MR . RIDEOUT: Now, Mr.

Speaker, there were some legitimate observations made by a number of speakers on the other side of the House. I must admit, Mr. Speaker, that it is legitimate No. 40 R2138

to ask, when you are only two or two and a h a 1 f years into a f i v e year business plan, has enough of a trend been developed? That is a reasonable, .legitimate question to ask. And we had to soul-~earch ourselves, Mr. Speaker, as a government, because I have said publicly before and I have no hesitation in saying in this Legislature, that we did not rush into the privatization of FPI for the sake of privatization.

I could not care less, as the minister responsible and holding the shares on behalf of the Province of Newfoundland, whether we did it t~day, whether we did it tomorrow or whether we did it in five years time. The question you had to make a judgment call on, on the best fiscal advice available to you, is what is the future of this company? I believe I tried to address that, Mr. Speaker, in a meaningful way when I introduced this bill, that we are reasonably comfortable; we are not 100 per cent certain, but we are as comfortable as you can be.

I believe the gentleman from Twillingate referred to it when he said, 11 The minister will say, 1 You cannot stare into a crystal ball 1 , 11 and that is true.

But with the best fiscal advice available to us we are reasonably comfortable that this company, with practically nil of a debt load because they have privatized themselves by going to the public and. getting public investment - it was not a borrowing - so with a good, sound debt free balance sheet, I believe and this government believes that this company is dynamic and strong enough to be able to go with the good times and survive the downturns in the fishing industry. Because as everybody knows in this House, Mr.

S~eaker, L2139 May 12, 1987 Vol XL · as sure as we are here today, we may continue to have upswings for the n ex t two , three , four· or five years - we hope we do, we have if is for the next twenty years - but sometime or another, due to the cycltcal nature of this industry, there will be again downturns. And that brings up another legitimate point raised by a