October

30, 1991

HOUSE OF ASSEMBLY PROCEEDINGS Vol.

XLI No. 63

The House met at 3:00 p.m.

MR. SPEAKER (Lush): Order, please!

Statements by Ministers

MR. SPEAKER: The hon. the Premier.

PREMIER WELLS: Mr. Speaker, at the outset I am going to

apologize for the length of this statement. It is longer than I ever want to

make as a statement again. It is fairly lengthy because it is a fairly important

topic and I want to explain the issue fully to the House.

I am taking the opportunity to advise Members of the House of

the decision of Government to enter into a co-operative procurement agreement

with the other Atlantic Provinces.

A national process of removing barriers to the free flow of

goods, services, capital and people across provincial boundaries started in 1987

at the First Minister's Conference. As a result of that initiative, the

Government of Newfoundland and Labrador signed an agreement in the summer of

1990 which would remove barriers in respect of goods procurement by governments.

That agreement was finalized this year with the accession to the agreement of

decision by the Government of Newfoundland and Labrador to enter an expanded

arrangement among the Atlantic Provinces is another step in that process.

Before commenting on the specifics of this particular

arrangement I want to set the matter in proper context. We are living in a world

in which economic and commercial barriers are being rapidly dismantled. The four

freedoms - the freedom of movement of capital, goods, services and people across

boundaries is becoming a hallmark of not only the national but really of the new

world economy. This movement is unleashing productive and competitive economic

forces which are generally accepted by all to be a critical requirement for

increased economic output and prosperity. As I have noted above, the process in

Canada was initiated by the First Ministers in 1987. The Federal Government in

its recent constitutional proposals "Shaping Canada's Future Together" proposed

Part 111 of the document a broadening of

Section 121 of the Constitutional

Act 1867 state that "Canada is an economic union within which persons, goods,

services, and capital may move freely without barriers or restrictions based on

provincial or territorial boundaries."

It is the objective of the Federal Government that the

integration of the Canadian economy and the Canadian marketplace that is

envisaged in this proposal be accomplished by 1995, and that is the direction in

which we are clearly moving.

In addition to that you should note, Mr. Speaker, that the

general agreement on tariffs and trade would also require such removal of

barriers. Most recently a decision by a panel under the GATT made a decision

that certain barriers within Canada to the free movement of beer held by

Government is illegal and Canada must take steps to correct it; as well, the

free trade agreement is taking us in that same direction.

This is the context of the decision by the Government of

Newfoundland and Labrador to embark on this step of removing barriers at the

provincial level between ourselves and the Maritime Provinces. We are

increasingly living in a world where we cannot hide behind protective barriers.

More than almost any other provincial economy in Canada, Newfoundland depends on

its ability to export. More than 30 % of all goods and services produced in

Newfoundland is exported.

I will turn now to a more specific description of the

Agreement which the Government will enter into with the Governments of the three

Maritime Provinces on June 30, 1992. I want to compare that to the National

Agreement for Goods Procurement, and I will explain the parameters around the

Government's decision to take this particular action.

In December 1989 the Premiers of Nova Scotia, New Brunswick,

and Prince Edward Island signed the Maritime Procurement Agreement which came

into effect on April 2, 1990. That agreement covers the procurement of all goods

valued at $25,000 and above, all service contracts valued at $50,000 and above,

and all construction contracts valued at $100,000 and above. The agreement

covers procurement by almost all government departments, agencies, commissions

and crown corporations. Maritime Premiers have committed to encouraging all

organizations not covered by the agreement to follow its principles, and that

would be municipalities, universities, schools and hospitals and so on, the so

called MUSH factor.

The National Intergovernmental Agreement on Government

Procurement is to remove all forms of discrimination based on the province of

origin of goods or suppliers of goods, and applies to procurement contracts with

a value of $25,000 or more. This includes contracts for goods awarded by

government departments only. Construction and services, and all contracts

awarded by crown corporations are excluded from the national agreement.

Participating governments are committed to negotiations to extend the principles

of the agreement to cover other procurement activities, particularly in the area

of services and construction.

At the May 31st, meeting of the Conference of Atlantic

Premiers, Newfoundland was invited by the Premiers of Nova Scotia, New Brunswick

and PEI to become part of the Maritime Agreement. The matter was considered by

Government which issued a series of guidelines for Newfoundland's negotiated

accession to that agreement. The guidelines established by that Order in Council

were as follows:

(

a) that the text of the agreement must be strengthened to

ensure open and transparent procurement systems exist in the Maritime Provinces.

We did that because we were the only province with a full open public tender

arrangement. The others had a more closed arrangement where they could invite

special suppliers to bid on it and so on, so we insisted that would be one of

the conditions.

(

b) that equivalent procedures and practices exist in each

province.

(

c) an effective dispute settlement mechanism would be in

place.

(

d) signatories cannot exercise the option to revert to less

open procurement practices in the future.

(

e) the Government of Newfoundland and Labrador should

negotiate a gradual phase-out period for the local preference policy in respect

of suppliers from the Maritime Provinces.

(

f) that the revised agreement must be given legislative

effect in each province; and the agreement should be entered into on the

understanding that it would not erect regional barriers against provinces

outside the region, thereby precluding a fiscal advantage to the Government of

Newfoundland and Labrador of being able to accept lower bids from suppliers in

these provinces, with consequent savings to the Newfoundland taxpayer.

In addition to these parameters, I instructed my officials to

engage in a process of consultation with the Newfoundland private sector to

ensure that any actions taken by Government would create business opportunities

for, and have the support of the private sector. We engaged in a process of

consultation with the following associations:

Newfoundland and Labrador Construction Association

Newfoundland and Labrador Road Builders Association

Newfoundland and Labrador Manufacturers Association

Newfoundland Environmental Industry Association

Canadian Federation of Independent Business; and by that we

mean the Newfoundland Sector.

Newfoundland Ocean Industries Association

Newfoundland and Labrador Book Publishers Association

Newfoundland Association of Technical Industries

Newfoundland and Labrador Chamber of Commerce; which is the

body that represents all chambers in the Province.

St. John's Board of Trade.

The industry message was that it welcomed an expanded

procurement

market, but it urged the Government to take two specific

measures:

(1) to ensure equal access to procurement opportunities in

each of the Atlantic Provinces; and

(2) to take measures which places Newfoundland businesses in

a competitive position with the Maritime firms.

According to these associations, they suggested tax reform is

a particularly important part of the competitiveness issue.

I am pleased to be able to report to the Members of the House

today that our negotiations with the other three provinces have enabled us to

meet all of the requirements established by Government, and the measures

recommended by the private sector.

The Maritime Provinces have agreed to drop from the

agreement, certain commodity preferences which they had retained, e.g. culverts,

paint, etc. This will take effect on June 30, 1992, which is the same date that

Newfoundland would join the agreement.

We have agreed to a phase-out of the Newfoundland preference

requirement in respect of suppliers from the Maritime Provinces within the

threshold of the Agreement, our present preference which stands at 15 per cent.

When we sign the agreement on June 30, 1992 it will be reduced to 10 per cent.

It will be reduced to 5 per cent on December 31, 1992. The remaining 5 per cent

will be eliminated on December 31, 1993. So that is the phase-out that the

Government insisted be put in place. As the bulk of Newfoundland tender awards

which benefited from the local preference policy required preferential treatment

of less than 5 per cent, this phase-out period will effectively maintain that

advantage during an adjustment period which will not end until December 31 1993,

two years from now.

In the fiscal year 1988-1989 the Government Purchasing Agency

issued approximately 11,000 purchase orders to purchase goods and services

valued at $104.9 million. Approximately 480 of these Purchase Orders or 4 per

cent were for contracts greater than $25,000 and account for $85 million.

However, contracts both over $25,000 and awarded under the Local Preference

Policy in 1988-1989 totalled approximately eleven contracts and accounted for

only $3.2 million or 3 per cent of the total. So you can see from those figures

that Newfoundland would not be severely, adversely impacted by this.

This brief analysis suggest limited negative impact if we

amend the Local Preference Policy to implement either the Atlantic or the

National Agreement in the area of goods and services procurement. Preliminary

statistics for 1989 on construction contracts indicate that seventy-eight

contracts greater than $100,000 each were awarded by Government for work

totalling in excess of $54 million. So that much could have been affected.

The agreement will make provision for an effective dispute

settlement mechanism. This mechanism will be available to any Newfoundland

business which feels it is not receiving the full benefits of this agreement

from any government in the Maritime provinces.

The Maritime premiers have agreed to give this agreement -

and I just might add there - because it has been in effect and operating in the

Maritimes for the last year or so we have been able to have a look at how it has

been working amongst those three provinces and we are satisfied that the dispute

settling mechanism does in fact work, and we are satisfied that they are

broadening or opening up their tendering process. They have agreed,

incidentally, to bring in legislation in those provinces within two years to

make it comparable to Newfoundland's legislation.

The Maritime Premiers have agreed to give this agreement

legislative effect within two years. This will coincide with the phasing out of

our local preference policy. Newfoundland public tendering systems have been for

some considerable time more open and transparent than similar systems in the

Maritime Provinces. The agreement by the Maritime Premiers to give this

agreement legislative effect within two years, will establish the same degree of

openness and transparency in their public tendering system which now exists in

Newfoundland. I should note here that the Newfoundland Act requires the public

tendering of all purchases over $5,000. Therefore, our preference provisions

will remain in place for purchases of goods, services and construction over

$5,000 and below $25,000 in the case of goods, below $50,000 in the case of

services, and below $100,000 in the case of construction.

The agreement does not now cover the activities of

municipalities, universities, schools, and hospitals, the so-called MUSH sector.

In Newfoundland the vast majority of that sector is covered by the public Tender

Act. This is not the case in the Maritime Provinces. Accordingly, that sector in

Newfoundland will not at the outset be subject to the provisions of the

agreement. However, Maritime Premiers have expressed a commitment to bring that

sector in their provinces within the ambit of the agreement. When that occurs,

the Government of Newfoundland and Labrador has accordingly given its commitment

that it will also bring that sector in Newfoundland into the agreement.

I was particularly sensitive to the advice of the private

sector associations with which we consulted that they face a higher tax burden

in Newfoundland than their competitors may face in the Maritime Provinces. This

is a result of the fact that Newfoundland and Labrador is larger than the other

three provinces combined, and as a Government we have to struggle to provide

public services in that vast terrain, spread out along 6,000 miles of coastline,

with a much smaller population and tax base, at a greater cost to the public

treasury than is the case elsewhere. There is only one way that I could see to

reduce the tax burden in Newfoundland without unduly curtailing public services,

or increasing the Government deficit, and that is by building on the principle

of equalization to include a formula based on a need factor. Now, I know the

former government attempted to achieve that, and I would suggest that perhaps

they were not successful primarily because they did not have support from the

Maritime Provinces. This is a requirement which, as I have noted, is

particularly unique to Newfoundland, and we were up to this point unable to

secure the support of other Premiers for Newfoundland's position on this matter.

As a result of negotiations yesterday, the other three provinces have agreed to

work with Newfoundland and to support Newfoundland in its efforts with the

Federal Government to have a need factor built into the equalization formula.

I am confident that the expanded market which this action

will make available to the Newfoundland business community is good for all of

Newfoundland and Labrador, and that the benefits to the public treasury of

increased competition in the provision of goods and services to government is in

the interest of taxpayers.

I again apologize to the House, Mr. Speaker, for the length

of the statement, but I felt it was necessary to provide some detail.

SOME HON. MEMBERS: Hear, hear!

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

SOME HON. MEMBERS: Hear, hear!

MR. SIMMS: Mr. Speaker, first of all, I want to thank the

Premier for a copy of the statement, although, as he knows, I only received it

about ten minutes or so before the House opened, so I barely had a chance to

read through it. I now have had a chance to listen to the Premier read it into

the record. So my comments at this stage are going to be somewhat preliminary,

but we will obviously have other comments to make as time goes on.

Mr. Speaker, I think it is fair to say that most people, off

the top of the head, would agree in principle with the elimination of barriers,

whatever barriers might exist in the Province. But when you are a Province that

has 20 per cent, or whatever it is, unemployment, it is extremely important that

the Government proceed cautiously and ensure, first of all, that our people are

protected. That is of the utmost importance to any government in this Province.

At the outset, I have to say to the Premier - I am speaking

individually at the moment - that I have a lot of concerns about the direction

in which we are heading, as a Province, as a result of this type of agreement,

and particularly, I have concerns about the speed with which we seem to be

moving. Because the Premier's statement, I think, in essence, is probably a very

significant step towards the establishment of a common economic zone in Atlantic

Canada. In other words, that is the old Atlantic economic union, we have heard a

lot of talk about. This is a significant step in that direction, I believe.

I can also say to the Premier that, just this morning, we

have had several telephone conversations with people who have called us,

business people, in particular, and others that we have communicated with

ourselves. I can tell him that we are not the only ones who share a lot of

concerns about what is being announced here today.

Now, there are three specifics, I suppose, that I have been

able to identify in his statement. One is the participation by Newfoundland and

Labrador in a procurement agreement that would presumably be binding on the

governments, the institutions and agencies, school boards, universities,

colleges, and hospitals, those agencies that he has mentioned. This, I would

presume, means there is an agreement now among the four governments that not

only the governments, themselves, but all of the agencies, would be involved in

bulk purchase arrangements. I presume that is what he is saying and what he is

announcing.

For example, just to use a simple example, toilet paper - is

this what he means? These are the questions that are being raised. Bulk

purchasing -

AN HON. MEMBER: No.

MR. SIMMS: No bulk purchasing involved at all, absolutely

none?

PREMIER WELLS: Not in this, nothing whatsoever.

MR. SIMMS: Not in this. But what is the plan, what is the

thinking, what is this going to lead to? That is the point we are trying to

make. Is this where we are heading? Is that the direction in which we are

heading? That is the point I made right at the outset when I talked about it

being a significant step towards the Atlantic economic union that people have

talked about.

Now, there are some other ideas in the statement, of course,

that deserve to be mentioned. I want to talk, specifically, about page 4, where

the Premier talked about instructing his officials "to engage in a process of

consultation with the private sector to ensure that any actions taken by

Government would create business opportunities for, and have the support of the

private sector." Then, there is an interesting statement right after it. The

sentence after it says: "We engaged in a process of consultation with the

following associations: ..." And he lists off a number of associations. That

does not imply that you necessarily had their support, simply that these are

groups that were consulted with. Is that what the intent of that comment is?

That is the question I am asking, and he can address that a little later on.

Because we have talked to some of them, and the implication certainly is here

that you had their complete support for it.

In addition to that, the Premier mentions the fact that there

will be a legislative agreement required to put this agreement in place. So we

will have a better opportunity at that stage, I suppose, to debate and discuss

it. The Minister of Development nods and says yes, so I assume that is accurate.

Mr. Speaker, there are all kinds of other items in here, of

course, too. He mentions that the Maritime Provinces have agreed to drop from

the agreement certain commodity preferences which they had retained. He talks

about culverts and paint and so on. I seem to recollect that those items were

agreed to at an earlier meeting that would take place in 1995 or something, and

now they have moved it ahead to 1992 or whatever.

AN HON. MEMBER: (Inaudible).

MR. SIMMS: That's correct. The Minister of Development

says no, the Premier says it is correct. I will take the Premier's word on this

occasion.

Now, Mr. Speaker, as I said, there are a lot of concerns that

people would have to express about this whole issue. And you cannot slough off

the fact of the matter that there are, for example, as he, himself, announced on

page 6, $54 million worth of contracts. Fifty-four million dollars worth of

contracts is a lot of money in the context of Newfoundland and Labrador. It

means a lot to a lot of those businesses that have been calling our offices this

morning. It means a lot to businesses that I spoke to myself this morning. They

are quite concerned about what is going on.

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

I do not know if the hon. the Leader of the Opposition is

aware that, on Wednesdays, the Chair is obligated to call Question Period at

this particular point, unless by agreement of the House.

The hon. the Government House Leader.

MR. BAKER: Mr. Speaker, by leave, I am sure that we could

allow the hon. member to finish up his statement in response to the Premier.

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

MR. SIMMS: I will just try to clue up. Obviously, you

only get half the time to respond, and on a Private Member's Day, it is very

difficult.

In any event, Mr. Speaker, I have just raised some issues and

questions. There is an overall question that we have about the necessity to get

rid of the Local Preference Policy. I think that is one of the biggest issues on

the minds of people and I will address that a little later on - we will address

it. The other specific element in the statement, I think, deals with taxation.

On the issue of equalization, for example, I understand what the Premier is

attempting to do there, and if he can get the full support of the other Atlantic

Provinces, that will be very helpful to our case. As he said, we, ourselves, as

a government in the past, attempted to do it. That would be helpful to us, and I

really have no difficulty with it, from what I understand he has been talking

about in terms of equalization. But in the coming days we will be seeking

further clarification and asking questions of the Premier as to the significance

of this particular item in the statement.

Mr. Speaker, I do want to say this: I believe, in fact, that

what we have unfolding before us perhaps might be considered by some to be the

ultimate amalgamation. A lot of people will put it in that perspective because

that is a topical issue to debate. I want to simply urge the Premier, before he

takes unilateral action, that he consult with the people to ensure that they are

fully informed and that their views are respected in the process that the

Premier now has undertaken, which will bring Newfoundland closer, I think,

economically, and probably closer to a political marriage of sorts within the

framework of an Atlantic Canada. I think that is where we are moving.

Unfortunately, Mr. Speaker, while that is a movement that has

long been supported and advocated by Federal Governments in the past, every

single Provincial Government in this Province's history has strongly resisted

that kind of a move and I urge him to be extremely cautious.

Thank you, Mr. Speaker.

SOME HON. MEMBERS: Hear, hear!

Oral Questions

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

MR. SIMMS: Mr. Speaker, sticking with the same issue and

the same topic that we just deal with during Statements, the Premier announced

this new program, this new policy and, as a result, as we said, the Newfoundland

Government's local preference policy is going to be phased out by 1993, I think

it is, within a two year period. Now, as was indicated at the time that the

local preference policy was initiated, that policy was never intended to be in

place permanently, but it was an affirmative action program, I guess, that is

the best way to put it, to help Newfoundland businesses be in a position where

they could compete with outside businesses from the Maritime Provinces. I want

to ask the Premier today, given that - and that is a fact - have we, in fact, in

his opinion, now reached that point, and if so, has he some economic studies to

show that we are, in fact, now at a level competition playing field with other

businesses in Atlantic Canada?

MR. SPEAKER: The hon. the Premier.

PREMIER WELLS: Mr. Speaker, it is obvious that in respect

of the production of some goods we have less capability than other producers in

Atlantic Canada. With respect to the production of other goods we have a greater

and more effective capability and can do a better job, and can compete in

Atlantic Canada and, in some cases, in other places on the mainland,

effectively, with other producers. Just to give you an example, one of the big

concerns of Standard Manufacturing, the manufacturer of paints, is they have

never been able to compete for the major highroad businesses in Atlantic Canada,

because Nova Scotia, for example, would invite tenders or do business only with

the Nova Scotia manufacturer. The manufacturer in Newfoundland was confident

that it could work competitively and bid to get jobs if only we did not have

these kinds of restrictions between provinces. So that is one example. There are

numerous other examples, Mr. Speaker, that could be mentioned, but to also add

to the information, I would point out that just two days ago, or maybe it was

only a day ago, the Minister of Development announced the `Buy Newfoundland'

policy that the Government is carrying on and implementing. This was our

initiative, Mr. Speaker. As a matter of fact, I will even go further, the

original plan and purpose was my own and I got the Economic Recovery Commission

to design the approach and work with industry to design a program so that we

would provide the basic money necessary, the seed money, if you will, to get an

advertising program going, and after that the producers who participated by

buying the stickers would pay the cost of future advertising and we would be

able to carry it on. In that way, we will help our producers to be more

competitive, but I am satisfied, Mr. Speaker, that we will be competitive. More

particularly, Mr. Speaker, the important factor is, face the inevitable, it is

coming, anyway. If we do not get the maximum advantage that we can out of it

now, it is coming as a result of the application of the GATT, it is coming as a

result of the application of the Free Trade Agreement, it is coming as a result

of the Constitutional changes. So, face the inevitable, it is going to come,

anyway, and let us get the maximum advantage that we can, now.

MR. SPEAKER: The hon. the Leader of the Opposition, on a

supplementary.

MR. SIMMS: Mr. Speaker, that is all fine and dandy and a

great speech by the Premier, but he should also talk to businesses like Blue

Buoy Foods, for example, a Newfoundland company, solely owned, in fact, by

Newfoundlanders, and ask them for their view of this policy, what they think of

it. I can tell you, they are very concerned about it and, in fact, they think it

is going to lead to devastation for them. Maybe the minister could call them

afterwards and have a discussion about it. I also understand from the statement,

the Premier said that, after consultations, he had the support of business

community and they were in agreement, generally, with the elimination of local

preferences. That is what he is telling us in the statement. Can he confirm for

me that, really, it was only a week or so ago that a meeting of the various

business sectors was called to bring the various business sectors together in a

hasty way to try to get their significant agreement on this issue, and can he

confirm that they were in fact unable at that meeting to reach a common position

on the whole issue, can he confirm that for me, and secondly, can he tell us

which business interests agree that local preference should go and which ones

disagree?

MR. SPEAKER: The hon. the Premier.

PREMIER WELLS: Mr. Speaker, the Leader of the Opposition

is not properly informed. Meetings took place, some of them months ago; they

were initiated months ago. The final meeting on the matter occurred on October

23rd I believe was the date - yes, that was the final one after months; it is

not one that was just hastefully called together last week as the Leader of the

Opposition implied. That is not so. The discussions were initiated and the

assessment was initiated months ago.

Now, Mr. Speaker, that group that came together last week,

were generally speaking of a mind on the issue. They agreed that they would

support the issue providing we could ensure equal access to procurement

opportunities in the other Atlantic Provinces and secondly, that we could make

sure that we took steps to improve the playing field as far as Newfoundland

producers were concerned. Two means they suggested in the resolution on that:

one, to try and get Newfoundland's tax levels to be roughly the equivalent of

the Maritime tax levels; and I have told you what we have done with respect to

that and what I think would make a significant contribution and secondly, they

suggested some changes in transportation regulations and so on that would also

make a contribution; they felt that the Government could help improve the

competitiveness of the Newfoundland producers.

Now, Mr. Speaker, I am advised - I was not at the meeting, so

I cannot speak with absolute certainty - but I am advised by the officials who

did participate and who know of it, that all groups basically supported this and

that in fact, a resolution in that form was drafted; some wanted some minor

changes in it that would not affect the principle. But I am advised that

basically all groups supported this approach.

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

final supplementary.

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

Well, somebody's advice is not quite correct. I spoke to

somebody who was at the meeting and that was the information that was relayed to

me, they felt it was hastily called prior to the Premier's trip to PEI, so he

could have some indication and that is why it was called just last Wednesday,

the 23rd of October or whenever it was; secondly, that there was not common

agreement on the issue at that meeting. That is all I can tell the Premier; that

is the information that we have. But I want to move on quickly and ask him this

question.

Does he think, if in fact the Government is going to proceed,

and it appears that this is their intention and they are determined to move in

this direction, does he think that the two years, I think, that has been allowed

for the phaseout of local preference, does he think that that is long enough,

time enough, or does he not think that perhaps he is moving a bit too hastily?

Could he not look at, if they are going to move this way, look at the

possibility of the phaseout over a longer period of time, so that people have a

better understanding of how it is going to work and how it is going to affect

them and have more opportunities I suppose, to let the Government know what

their views are on this whole question?

MR. SPEAKER: The hon. the Premier.

PREMIER WELLS: There are two things that I need to

address specifically, one of which is the suggestion that this is being done

with inordinate speed and haste. Let me remind members, Mr. Speaker, that the

Maritime Provinces and Newfoundland have been discussing this for several years,

years, that the Maritime Provinces signed the agreement in April of 1990;

Newfoundland did not. We are a further year and a half - a further year and a

half, where we have taken a process of consultation with the public sector and,

Mr. Speaker, when I say months ago, the first consultation with the private

sector took place more than a year ago and I have some personal knowledge of

that, when it started more than a year ago shortly after the Maritimes signed

their agreement and we did not sign the agreement, because we wanted to do a

more thorough assessment, so there is no rush, this has been underway for years.

Now you can sit and do nothing except contemplate your navel

forever if you want to, and if that is the approach you take, you will achieve

nothing; so I do not want this suggestion that there has been inordinate speed

to stand unchallenged because it is not at all accurate.

The second point that the hon. the Leader of the Opposition

made was: shouldn't we have arranged for a longer phaseout period. I agree with

him. If we could have achieved it, it would have been desirable. As a matter of

fact, we started bargaining with a phaseout to be effective on January 1, 1996,

which would have given four years instead of two years. But do not forget, there

were three other parties to the agreement and we could not unilaterally declare

the phase-in period. So we spent all this time and months negotiating the

phase-in period. Well, we got what we think is a reasonable compromise in the

circumstances. It phases in, to be completely in effect, on January 1, 1994. So

I think that is a reasonable one in the circumstances. If we could have gotten

1996 it would have been better, I agree.

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

MR. WINDSOR: Thank you, Mr. Speaker.

SOME HON. MEMBERS: Hear, hear!

MR. WINDSOR: Along these same lines, Mr. Speaker, the

Premier is quite accurate when he says this issue has been discussed for several

years. The initiation, however, has primarily been from Newfoundland to break

down the hidden barriers that other provinces have had in place. Newfoundland

was honest and straightforward and came forward with a local preference policy

that protected our people, but it was impossible for our people to compete

against the hidden barriers that were put in place in other areas.

SOME HON. MEMBERS: Hear, hear!

MR. WINDSOR: It is interesting that the rush seems to

come on now from other provinces to participate in this kind of a free trade

thing. Now that major procurement for Hibernia is taking place in Newfoundland,

all of a sudden they need us.

SOME HON. MEMBERS: Hear, hear!

MR. WINDSOR: Mr. Speaker, let me ask the Premier, as it

relates to tax policies here - we are talking about harmonization of the tax

policy. Maybe the Premier would like to tell us which taxes now will be

harmonized? Are we talking about a complete harmonization of tax policy? Will

the Premier tell us, in order to off-load the burden from the public sector will

he now eliminate the silly payroll tax that he implemented, which puts us at a

direct disadvantage with other provinces of Canada, and is this another attempt

by the Premier to off-load this on equalization? Is he now going to depend on

equalization instead of taxation? Is this his game?

MR. SPEAKER: The hon. the Premier.

PREMIER WELLS: Let me explain to the hon. Member, that

nothing he mentioned has any particular relevance to this proposal. To begin

with, it has no application whatsoever to Hibernia, none. It affects it not one

iota.

MR. WINDSOR: Do not be so foolish! That is extreme

naivety.

MR. SPEAKER: Order, please!

PREMIER WELLS: Just incredible! This, Mr. Speaker,

applies only to purchases by governments and government agencies. Private

enterprises can go and purchase wherever they like, whatever they like. It does

not make any difference. We cannot tell private enterprise where they are going

to buy. If they want to buy from New Brunswick for a higher value they can do

it. If they want to buy from New Brunswick for a lesser value they can do it.

That is up to private enterprise. This has no application whatsoever to

Hibernia, and I am quite surprised at the suggestion by members opposite that it

could have any application at all to Hibernia.

Secondly, Mr. Speaker, he talked about harmonization of

taxes. Now, what we have been talking about in terms of harmonization is

harmonizing the retail sales tax with the Federal goods and services tax. It has

nothing whatsoever to do with this agreement, no application to it in any manner

whatsoever. If we were to harmonize with the Federal goods and services tax, and

that would enable us to drop our retail sales tax rate and enable us to provide

business input credits, it would put our businesses at a competitive advantage

with the other Maritime Provinces. So we had to take that into account, but this

agreement makes no provision for it and does not relate to harmonization in any

way whatsoever.

MR. SPEAKER: The hon. the Member for Mount Pearl, on a

supplementary.

MR. WINDSOR: Mr. Speaker, at it relates to Hibernia the

Premier seems to have forgotten the best efforts clause in the Atlantic Accord,

under which the companies undertook their best efforts to do the procurement in

Newfoundland. I assume that one has now gone out the window.

SOME HON. MEMBERS: Hear, hear!

MR. WINDSOR: Mr. Speaker, the Premier said in his

statement that in order to equalize the tax burden on businesses in Newfoundland

versus those in other parts of the Maritime Provinces, there are only certain

options. One is to reduce expenditures. Would the Premier like to tell us if a

way of reducing provincial expenditures is to further down-load the tax burden

to municipalities since municipalities in other parts of Canada support a larger

share of the tax burden than do municipalities in Newfoundland? Is the Premier

telling us this will be part of his scheme, to move more of the tax burden from

the provincial coffers to municipal coffers.

MR. SPEAKER: The hon. the Premier.

PREMIER WELLS: Let me deal with the Hibernia best efforts

again.

Mr. Speaker, if it has not been made clear to the hon. Member

for Mount Pearl, who should be knowledgeable about the matter, I am concerned

that we have not made it clear to anybody else. This agreement is an undertaking

by governments in respect of purchases by governments and government agencies,

and that is all. Hibernia companies, and anybody else not in any manner

affected. The best efforts with respect to Hibernia is not in any manner

affected by this.

AN HON. MEMBER: Crown corporations?

PREMIER WELLS: Crown corporations, yes, but Hibernia is

not a Crown Corporation, Mobil is not a Crown Corporation, Gulf is not a Crown

Corporation, Chevron is not a Crown Corporation, Petro-Canada is a Federal Crown

Corporation in part still. So it has no application whatsoever to Hibernia, best

efforts or otherwise, in any way whatsoever.

Now, Mr. Speaker, the second part of the question was: is it

part of an overall plan to down-load onto municipalities? No, Mr. Speaker, it

has nothing to do with loading on municipalities, up-loading or down-loading.

Absolutely not.

Mr. Speaker, the Maritime Provinces are engaged in another

undertaking that is quite separate and apart from this, nothing to do with it,

arose after this agreement was put in place, and that effort is what they called

- originally it was talking about economic union in the Maritimes and they

wanted Newfoundland to participate, and I said to them: I don't think you can

achieve economic union. You cannot have an economic union within an economic

union. The only way that can take place is if you go all the way with political

union. That is right, this is what I said to them. If you are talking about

political union, yes you can achieve economic union. Can you achieve

co-operation amongst the four provinces? Yes you can. You can save a lot of

money for taxpayers if you have in place a single securities management

regulatory system. You could do that because we do not have enough securities

activities in any one of the provinces to warrant a separate regulatory agency,

so we could save a lot of money by doing that. We can save a lot of money by

working co-operatively on post-secondary education. We do not need to put in

place another dental school in Newfoundland in order to provide dentists because

we can work co-operatively with the other Atlantic Provinces. Those kinds of

things can be done and we can increase the level of co-operation, but economic

union is quite something else.

Now, Mr. Speaker, with respect to municipal taxes in

particular, the one field of taxation where Newfoundland is way below the

national average is in municipal property tax. Basically we are about 42 per

cent of the national average, the lowest in the country, and that is because

former governments in this Province put in place a system of provincial grants

to municipalities and so on, and this probably needs some adjustment in the

future so that municipalities take a fairer share of the burden.

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

MR. WINDSOR: Mr. Speaker, before I get into my question,

what I really want to say to the Premier is that is exactly my point, that we

are lower at the municipal level, and if the Province is going to somehow lower

the burden on businesses then they have to gain it back some other way and I

suspect that this is another example of seeing down-loading to municipalities.

Mr. Speaker, if I may have a very brief

preamble, when the

Premier talks about economic union and political union, I represented the

Opposition at the APEC conference in Halifax a couple of months ago where

economic and political union were very much the topic of the day, and I tell the

Premier, if he is not already aware of it, and I am sure he is, that there is a

very strong move in Atlantic Canada for economic union. There was not quite as

strong, but still a very strong movement toward political union, and we may well

be faced with that, and I suspect that this whole move is the first step in

that.

Mr. Speaker, along that same line, if we are now going to

harmonize all of our taxes with the other provinces of Atlantic Canada will the

Premier not confirm that that therefore is giving up an awful lot of our

flexibility in doing our Budget and setting our social policies? This is the

same problem we have with harmonization with GST and the Minister of Finance

proposing to piggyback on GST. If he does that, it takes away a lot of our

flexibility to use the taxation system for social reasons. Will the Premier

confirm that we are giving up a lot of our flexibility and the opportunity to

manage our own budget?

MR. SPEAKER: The hon. the Premier.

PREMIER WELLS: Mr. Speaker, I do not know where this is

coming from - that we are harmonizing all our taxes with Atlantic Canada? Nobody

ever suggested it. It certainly does not appear in this statement. It is not in

the agreement.

AN HON. MEMBER: (Inaudible).

PREMIER WELLS: But this is not tax harmonization. The

only role tax plays in this is that we, the producers in Newfoundland, the ten

groups that we met with, said: look, one of the factors in our being less

competitive than some producers in Atlantic Canada is the fact that in

Newfoundland we have to pay higher taxes, higher provincial taxes, and it is

hard to argue with that. They pay higher retail sales tax on goods and stuff

they purchase for the business. They pay higher corporate tax and so on, so they

said we have higher taxes to cope with, so this makes us less competitive, and

you have to try and do something about that. Here is what we said: we agree, now

there is a reason why Newfoundland's taxes are higher on average than the

Maritimes, simply because we have a small population of 575,000 that is

distributed among some 700-plus communities, spread out along 6,000 miles of

coastline, in a geographic area three times the size of the other Atlantic

Provinces put together, and they have nearly 2,000,000 people between them. Now

there is our fundamental problem. So, we get equalization paid to us by the

Federal Government without taking that into account, so that our cost of

providing governmental services is obviously much higher than it is in the

Maritimes. So we have to have higher taxes. So what we said was: you support us

to get the needs factor, and the cost of building highroads and maintaining

schools and hospitals in a province the size of Newfoundland, with our small

population, is ten, fifteen, or twenty per cent higher than it is in the

Maritimes; you support us to get that included as a factor in equalization, and

we will get higher equalization and have less need for taxes, so we will be able

to lower our taxes.

MR. WINDSOR: Was the agreement contingent on the Federal

Government (inaudible)?

PREMIER WELLS: No, the agreement is not contingent on

that, no.

MR. WINDSOR: But you will have to raise taxes?

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

West.

AN HON. MEMBER: (Inaudible).

MR. TOBIN: Mr. Speaker, I have a question for the

Minister -

MR. SPEAKER: Order, please!

I have recognized the hon. the Member for Burin - Placentia

West, but just before he speaks I just want to make a comment again to hon.

Members about Question Period, and the necessity to keep questions brief and, of

course, the necessity to keep answers brief. If the questions are not brief, it

is not likely the answers are going to be brief, so there is a responsibility to

keep the questions brief, although that does not necessarily follow. But when

the question is brief, at least the Chair is in a better position to know what

the answer is. Now, the hon. the Member for Burin - Placentia West.

MR. TOBIN: Mr. Speaker, I have a question for the

Minister of Development.

Presently on the Burin Peninsula there exists, I guess, what

would be termed an economic crisis; the equivalent, Mr. Speaker, of a close-down

of fish plants in terms of the Marystown Shipyard. Two and a half years ago

there were between 500 and 600 employees at the Marystown Shipyard. In two weeks

time, Mr. Speaker, there will be thirty-five unionized employees left in that

facility. Mr. Speaker, people like the president of the union, for example, who

for twenty years has worked uninterrupted at the Marystown Shipyard, has now

received his layoff notice, and in two weeks time he will join the rest of the

unemployed people there.

I want to ask the Minister of Development, Mr. Speaker, what

he is going to do to stop the crisis, and when can we expect to see some

positive action to keep the highly skilled tradespeople, our highly skilled

technical people, and our highly qualified management people on the Burin

Peninsula to continue to work for the Shipyard?

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

MR. FUREY: Mr. Speaker, I thank the hon. Member for his

question.

First of all, let me correct the record. At present, there

are 218 people working at the Shipyard; 141 of these people are unionized

employees, and seventy-seven are staff employees.

Mr. Speaker, there is no question that the Shipyard has come

upon very difficult times. I would be the first one to admit that, and I have

admitted it publicly on a number of occasions inside the Legislature and in the

media. There are no magic solutions, Mr. Speaker. This Government has always

said that we cannot wave a magic wand, nor are we in the position to concoct

contracts for the sake of concocting them. Because all that does is add to the

considerable burden and debt that is already at this Shipyard, and it is

hovering, I think, right now, around $37 million or $38 million. We have to

service the interest on that debt and pay operating overruns every year.

So, there are no magic wands and no simple solutions. This

Government undertook to divest of the Yard; we made that known and public some

time ago. We think that the future is not with governments. We are not good

shopkeepers, we are not good shipbuilders, we are Government. We are not in the

private sector. So we have taken the position that if we can we will divest of

the Yard and place it back out into the private sector with a reputable firm,

preferably an international firm that can bring its skills to bear at the Yard,

to go out into a very competitive environment to chase down various contracts.

In the interim, we have a number of bids that we have placed.

One of those is a considerable bid, and it is with respect to the embedded

pieces of the GBS. If we are successful in that bid, it will employ anywhere

from 100 to 150 people over a considerable period of time. But we are moving

forward on our divestiture package. We think it is the right way to go, a

positive way to go, and if we are successful on that, we think, in the long run,

it will be for the best for the people of the Burin Peninsula.

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

Burin - Placentia West.

MR. TOBIN: The minister left out one thing, Mr. Speaker,

when he said, `We are not good shipbuilders.' They are not good government,

either, because the people in Marystown worked at the Marystown Shipyard on the

Burin Peninsula when there was another government in this Province. May I ask

the minister, then, will he make a commitment that the Marystown Shipyard -

forget Cow Head for a minute. Will the Marystown Shipyard continue to operate as

a shipbuilding industry? Will the several hundred employees at the Yard

throughout the years continue to be part of that operation under new ownership?

Will the Minister guarantee that a new owner will not be able to dispose of the

Marystown Shipyard at his convenience?

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

MR. FUREY: Mr. Speaker, there are no guarantees in

anything that we do. I explained to the hon. member, and he knows, above all

people in this legislature, what this Government inherited. We inherited a

Shipyard that was burdened with considerable debt. We inherited a Shipyard that

has to operate in terms of ship construction in a very competitive environment,

recognizing the Canadian shipbuilding policy is diametrically opposed to putting

us in a competitive position. What the Government has attempted to do is to

place this Yard in the private sector with a reputable firm that can go out

there, and using its international reputation -

MR. SPEAKER: Order, please!

I remind the hon. minister that it is 3:00 p.m. and, again, I

am obligated to call Private Member's Day, unless by agreement. When I brought

the Leader of the Opposition to order, the agreement was to carry on Question

Period.

The hon. the Government House Leader.

MR. BAKER: (Inaudible).

MR. SPEAKER: Four minutes?

The hon. the Minister of Development.

MR. FUREY: Mr. Speaker, what I am saying is that we

cannot give any guarantees. I can guarantee you that we are attempting, as

diligently as possible, to divest of the Yard. This is nothing new, Mr. Speaker.

It is something that our Government has just proceeded with, and it is much the

same way that previous governments, including his own government, attempted to

divest of the Yard on a number of occasions. If we are successful, it is my firm

belief that, in the long run, it will be in the best interests of the Yard, the

best interests of the employees, unionized and non-unionized, and it will put us

in the best position to secure some kind of prosperous future for these workers.

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

West, on a supplementary.

MR. TOBIN: Mr. Speaker, the minister also inherited a

subsidy programme that had $9 million left in it to construct vessels at the

Marystown Shipyard. He refused to put the money there, spending it elsewhere in

the Province.

Let me ask the minister, Mr. Speaker, Can he tell the House

when will Rosenberg be purchasing the Marystown Shipyard? He referred to snags

in the sale of the Marystown Shipyard, recently. Let me ask him if one of the

snags was an overrun of several million dollars on the facility, and have they

now sought other avenues to try to be bailed out on that?

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

MR. FUREY: Mr. Speaker, I am amazed that the hon. member

continues to bring up the $9 million subsidy. This Government, in concert with

Mr. Crosbie and the Federal Government, directed that $9 million into Marystown

for the construction of a shrimp trawler for Fishery Products International.

time. I do not want to dredge that up or rehash it but I would be interested in

knowing where the hon. member was on that particular issue, and what he advised

the people of the Burin Peninsula.

SOME HON. MEMBERS: Oh, oh!

MR. FUREY: No, Mr. Speaker, the money has gone back into

the Ocean Industries Subsidiary Agreement under an amended agreement, so that we

have increased the amount from $9 million to $13.5 million for the ocean

industries and marine sector of this Province. But, it is for the whole

Province, not just for Marystown.

Now, the hon. member asked me when was it that Rosenberg, I

think he said, would be purchasing this Yard. The company that we are dealing

with has asked me, specifically, to retain and keep their name in confidence. I

have, though, made arrangements for the negotiating team to meet with non-union

and union employees to discuss, in a preliminary way, what we are about with

respect to divestiture of this Yard. I hope to be in a position within the next

two to three days to explain to the public exactly where we are and to have a

definitive conclusion to this agreement.

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

time for a brief question.

MR. HARRIS: Thank you, Mr. Speaker. On a brief question,

I would like to ask the Premier, getting back to the Atlantic Procurement

Agreement, what consultations he had with the unions in this Province, and,

particularly, the construction unions, which will be most seriously affected by

this agreement, especially, now that the Government has failed to resolve the

problem of double-breasting? Are we going to have now, another problem with Nova

Scotia and New Brunswick coming in and bringing in their workers, non-union or

otherwise, and thereby destroy the construction labour force in this Province?

MR. SPEAKER: The hon. the Premier.

PREMIER WELLS: No, Mr. Speaker, we are not going to have

any such problems. We have not failed to deal with double-breasting. I believe

the minister will be bringing in legislation within the next week or two. Some

additional adjustment was necessary. I think that has now been worked out.

Anybody who comes to work in this Province will work subject

to our labour laws. We will take steps to make sure that those laws are fair to

both employers and employees alike, as they must be fair. We will insist that

that be the case.

MR. SPEAKER: Question Period has now expired.

PRIVATE MEMBER'S DAY

MR. SPEAKER: It being Wednesday, Private Member's Day, I

call on the Member for Eagle River to introduce his private motion and carry on

with the debate.

The hon. the Member for Eagle River.

MR. DUMARESQUE: Thank you, Mr. Speaker.

It is my pleasure, today, to propose this resolution to the

House for consideration:

WHEREAS the geography of Newfoundland and Labrador creates

undue costs to our citizens; and

WHEREAS many of our people must survive on seasonal

employment; and

WHEREAS present income support programs do not have

components to reflect this reality;

BE IT RESOLVED THAT both levels of government work towards a

new income support program which will stimulate the work ethic and maintain a

reasonable level of income for all our citizens.

Mr. Speaker, over the next little while I would like to

outline what I see as the problem, and in my closing remarks later this

afternoon, to offer some solutions for this problem.

The issue, Mr. Speaker, is more real now, I guess, than it

was, say, even several years ago. We have problems in income security, we have

problems in the level of income of our citizens, we have problems with the

nature of the programs being offered, and problems with the general work ethic.

Mr. Speaker, income security has always been a big question

of liberalism and, I guess, a big question of any government in this country. In

the McDonald Commission, a number of years ago, the whole question of income

security for Canadians was addressed in a substantial way, because, as Mr.

McDonald outlined, the present system is ineffective. It is far too complex, it

creates a work disincentive, and it is also very inequitable. He went on to

further point out that it is regressive and it is hard, especially on the

working poor.

Mr. Speaker, I want to outline how this problem particularly

affects a number of people in our Province, first of all, the fishermen of our

Province. The fishermen in my riding - and I know it is not unusual in other

parts of this Province where the inshore fish stocks have their own migratory

patterns. Ice conditions prevail in different degrees. Basically, Mr. Speaker,

what is happening now is that hundreds and even thousands of fishermen in this

Province have to go without income for, in the case of my district, up to eight

to ten weeks each year. They just do not have any certainty, because the date of

unemployment insurance is fixed so that you can only qualify and collect

unemployment insurance benefits from November 15 of one year to May 15 of the

following year.

This problem creates all kinds of difficulties at the two

worst times of the year when fishermen and their families need income. In the

fall of the year, it certainly does not enable them to prepare for Christmas, it

does not enable them to prepare for winter and it does not enable them to get

the kind of income necessary to meet their upcoming needs. In the spring of the

year, Mr. Speaker, in my part of the Province, people have to prepare for the

fishing season and, in our case, many of our fishermen cannot think about

fishing until the first of July. So, you are stuck there for six weeks without

adequate income to plan for your fishing season, to be able to buy your

groceries if you are moving outside, as hundreds of our fishermen do, move

outside to their fishing stations, to buy supplies for their fishing industry,

and to meet any other demands they would have.

Now, I do not want to indicate to the House that income

security is a problem only for fishermen or people in the fishing industry. We

have a general work force out there, Mr. Speaker, that just does not have the

kind of income security that, I believe, they deserve. The funding arrangements

we have, either in the UI system or the social services system, are not

appropriate, they are just not there. It is the same way with the old age

security. The programs that are there right now, Mr. Speaker, are just not set

up to be able to adequately address the cost of living that we find ourselves

in. People are having to work on very fixed incomes. In our case, many of the

people in the service industry have to meet their daily needs on minimum wage or

something just a little better.

We are finding that the level of income of our citizens is

just not able to meet their needs. Therefore, there has to be, I think,

reassessment of the whole issue of income security. Certainly, there has to be

greater income for families in this Province, for them to have any hope of

getting their children through school, into post-secondary education and having

them educated in the way that is necessary to avail of possible job

opportunities.

As I mentioned earlier, the levels of income for the working

poor is an issue that has not been addressed. The people of this Province,

hundreds and thousands of them, particularly, in this city, to meet their daily

needs, housing, clothing, and entertainment, if they can afford to do that, have

to do it on very basic wages. That is the kind of thing we, as a society, cannot

continue to stand for. I believe there is evidence that the work ethic has been

reduced over the last number of years, that people are not encouraged to work in

the general income security programs we have in place. The work ethic is being

reduced because under the existing programs you just cannot go out there and

earn that extra income without losing it directly off the assistance you might

be receiving. Whether it is under social assistance or the unemployment

insurance scheme, you lose the incentive that I believe is essential.

As it stands right now, for fishermen who have to go out

there and make whatever income they can, there is a regulation that says you

must have fifteen insurable weeks in order to select your best ten weeks. What

is happening is that, in many parts of the Province, especially in my area, once

fishermen get to the level of ten insurable weeks, they cannot take the chance

on going for fifteen weeks, since the weather for the greater part of the year

is harsh and due to inshore migratory patterns, the fish do not stay around. The

regulation is prohibitive, because if you get eleven, twelve, thirteen or

fourteen weeks and these weeks happened to be reduced compared to your previous

ten, your unemployment insurance benefits can be drastically reduced. So that is

a real disincentive, after having completed ten insurable weeks, if for a day or

two in that coming week the fish are still around, to going out there for that

extra income. Mr. Speaker, this is an example of how a particular guideline, a

particular regulation in the unemployment insurance system, is being a direct

disincentive to fishermen, keeping, I guess, extra revenue from the family and,

in turn, immediate spin-off from the community. Therefore, Mr. Speaker, we have

a general lack of economic activity because of the regulations on these

particular programs.

The work ethic is very important, no doubt, to our

productivity. We hear all kinds of words from Governments these days as to why

we have to strive for greater competitiveness in our marketplace and how we have

to be able to beat the competitor no matter where we are. We see more and more

in this country, statistics showing that our productivity is falling. That is a

very big concern.

The nature of the programs, themselves, Mr. Speaker, as I

mentioned, are a direct disincentive to our people being able to access job

opportunities. The programs are regressive. The unemployment insurance system in

place today is a regressive system. If a person, through tremendous effort,

going out and doing his best, earned $200 a week, he would get $120 a week in

Unemployment Insurance benefits; however, if a person, putting the same effort

into it, happened, by luck or whatever, to go to $600 that particular week, he

automatically would be able to get $360 of insurable earnings for the rest of

the time that he would be on these benefits.

So, Mr. Speaker, what we see here is a very regressive

program, one that keeps the poor, poor and one that is not providing the

incentive that I think we desperately need to have in place. Certainly, over the

last ten, to fifteen years, the gap between the rich and poor has not closed in

this country and I would submit that if we are not going to see any drastic

change in income security programs, there is not much hope that that gap will,

indeed, close, a goal towards which we should all be working.

There is little incentive to work under the existing

programs. Under the Social Services programs that are in place, and the UI,

which are the two most prominent ones, when you go out and work, you lose

practically dollar for dollar. These programs are not able to give you the kind

of flexibility that I believe many of our people really need when we have to

deal with seasonal industries and, indeed, look to every possible avenue to be

able to access extra income.

Another problem that I believe is predominant in some of our

programs and one that has to be dealt with in some way, I believe, in the

future, is that of lack of regional sensitivity. No matter where you are in this

Province today, or, indeed, no matter where you are in this country, the

unemployment insurance system deals with you the same way. Except for the number

of benefits you get, the unemployment insurance system says you will receive the

same number of dollars in Labrador as you do in St. John's. Except for the fact

that you work two or three extra weeks in St. John's, you would get that extra

five or six weeks benefit in Labrador.

But the fact is, Mr. Speaker, that dollar in Labrador is

supposed to go to the same length as the dollar does in St. John's or any other

part of Canada, and that is very unrealistic, not that Labrador should be

treated differently - and we expect that Labrador is going to have that extra

cost - St. John's also has that extra cost; they just have different costs. I

think, in some income security program, a regional sensitivity factor has to be

built into it, and that can certainly be done, as we will elaborate later this

afternoon.

So, Mr. Speaker, I think that what we are seeing here today -

and I know all members get the same kinds of calls - is a situation where people

just do not know where their dollar will be coming from; they just cannot plan

their family budgets and thereby be able to see that there is going to be

something for them in the weeks and months ahead.

The same thing can be said for the business community. How

can the business community plan for its annual forecasting if it cannot look to

a certain level of income in its particular market area? And again, I go to the

Coast of Labrador. How can a small-businessman, now, someone in the grocery

business, go out and put a certain amount of money into inventory for six months

of the year, if he has no idea of what people's level of income will be? It just

causes all kinds of problems in inventory costs and interest costs, and

therefore we are seeing, Mr. Speaker, I think a totally unreasonable situation.

As we go towards the twenty-first century I think we should be looking at having

a programme put in place where people are being given an incentive to work, but

the overriding thing has got to be that security of income. There is no reason,

in my view, why that security cannot be put in place. There is no reason why

governments cannot come together, that administrations cannot deal on that level

of income security and put their partisanship aside, because all governments

must recognize that after the election is over you are no longer a particular

political party government, you are there for the best interests of all the

people.

So, Mr. Speaker, I hope that we will hear support for this

particular issue over the coming few minutes that Members opposite and Members

on this side will have to speak. I know that the issue is a long standing one.

It is one that has garnered a great deal of public attention particularly on the

guaranteed annual income.

But, Mr. Speaker, in my closing remarks this afternoon I

would like to expand upon the options, and at that time apart from looking at

the guaranteed annual income I would like to look at the option of universality

and how that should be reviewed, how we should be looking at seeing whether, in

fact, the universality should always be there as a fundamental aspect of the

Canadian social safety net.

We should also be looking at, Mr. Speaker, reconstituting

income security, and it is a good time, in my view, to be looking at having that

done under our present constitutional debate that indeed there is a way and

there should be a way found to reconstitute income security where greater

sensitivity, a greater mandate for income security is given to the provinces, to

the people who are more sensitive to the regional problems we have even within

our own areas, Mr. Speaker. Certainly that must me done accompanied by the

appropriate tax credits and tax points that would enable the revenue to be

present to carry out the national standards that we may very well have in place.

But indeed, I think it is all too long at this point in time to still be looking

at having Ottawa determine how many weeks it needs to be for people to earn a

certain level of income in Labrador, or indeed if there cannot be any change

unless you go to the national federal institution in the House of Commons to see

something, because when you look at it from Ottawa all you see is a Canadian

picture, and you do not want to do one thing because it will upset the whole

Canadian apple cart.

Mr. Speaker, I think that it is time, and I will elaborate on

that later, time that we reviewed the Constitution and the responsibilities for

income security within that. So I close now, Mr. Speaker, and I look forward to

hearing the commentary for the remainder of today and hope that we can get

support on this particular issue.

SOME HON. MEMBERS: Hear, hear!

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

MR. WINSOR: Thank you, Mr. Speaker.

Mr. Speaker, I listened with great interest to the Member for

Eagle River as he spoke on the resolution he put forth yesterday. The issue that

he addressed is just motherhood. Who can argue against the kind of thing that

the Member proposed? We on this side have to agree with the general intent of

the resolution, that the programs, the safety nets that have been put in place

for perhaps some of the most disadvantaged people in our society, is not

adequate.

What concerns me, and I want to make some general comments

before we get into some specifics, what concerns me is that the Member for Eagle

River is sometimes a little too parochial, he only sees the province through his

own district, and he has to realize that there is a bigger picture. And it is

going to be very difficult in this country to carve up the country into little

kingdoms or little fiefdoms with different directions, different instructions as

to how each area of the province can be addressed.

Mr. Speaker, it is going to be a monumental task to ask a

national government to put that kind of program in place. If that kind of thing

that the Member advocated -

SOME HON. MEMBERS: Audio trouble.

MR. SPEAKER: Order, please!

I do not know whether hon. Members heard me. Thank you, very

much.

The hon. Member for Fogo.

MR. WINSOR: As I was saying the kind of program that he

envisions is going to be very difficult to administer from an national

perspective. While we have all kinds of problems with the present ones in place

I think that carving the country up into little sections, little portions, will

not adequately serve the interests of this country. The part of the resolution

that the hon. Member put forward: to move that the geography of Newfoundland and

Labrador creates undue cost to our citizens. There is no question about that.

There is no question that it varies with season, with place and with time. I do

not know how you adequately put in some kind of program that is going to reflect

the difficulty of getting fresh produce into Fogo, into L'Anse-au-Clair,

L'Anse-au-Meadows, or wherever it is at given times. It is very difficult to put

that kind of program in place because the needs and the cost of your district, I

am sure, escalate three-fold in the Winter over what they are in the Summer

because of a number of conditions. I do not know what kind of safety net you

could put in place that would take care of the local aberrations that occur. The

second part;

whereas many of our people must survive on seasonal unemployment.

That does not just apply to the Member's district, it applies to the entire

Province, my district being no different than the Member for Eagle Rivers is.

'The present income support programs do not have components to reflect this

reality.' There is no question about that, and neither does the one that perhaps

is of the greatest benefit in a district like mine where most people own their

own homes and do not have mortgages, the people who are on fixed income, old age

pensioners, and so on who do not have the problem that someone who lives in a

city with a $600 a month mortgage has. That is not there either. As I said

earlier we cannot go carving the Province up into little portions and say, you

are going to get a certain level, someone else is going to get another level,

and someone else is going to get something else. I just do not think it is

practical. The program that comes in has to be national in scope and has to

address the entire Province and indeed the entire country. I have great

difficulty in saying that we can have something for Labrador City and something

for Red Bay. It is just not the way the country can put a programme in place.

'Be it resolved that both levels of Government work toward a new income support

program which will stimulate the work ethic and maintain a reasonable level of

income for all citizens.' That is a motherhood issue. There is no question that

we will have to support a good and a new income support program, whatever it is,

and I am going to be looking forward most anxiously to the Member in his

conclusion, when he tells us what kind of programme he can put in place. It is

very difficult to address the problems of this country because the National

Government is going to have to be involved. If the Provincial Government can do

it then go out and do it, but we saw what the Provincial Government can do in

the Fisheries Adjustment Program when the Minister said in his press release

that he thought $2 million reflected the Province's share that it should have in

addressing a problem that, while it might be national in payment, was

provincial, the issue was a provincial one. I am not sure that the people in

Montreal, Toronto, or Ottawa cared very much that the fishery failed in

Newfoundland. The Government of Newfoundland could only find $2 million to

address this crisis and I am not sure where we are going to find the millions of

dollars needed to expand on any kind of programme. The Member was quite right

when he spent some time addressing the problems that fishermen experience in

this Province. We have a unique situation with UI. I suppose it is unique to

fishermen in that they are the only group in the country that are allowed to

collect UI benefits from self-employment. The problem with it, as he suggested,

is the November 15 to May 15 deadline. The problems that his fishermen

experience are no different than the ones in my District. It is virtually

impossible for small boat inshore fishermen, to fish past October 1 on a regular

basis. It is virtually impossible for anyone to fish on May 15, since fish do

not normally arrive, if we are talking cod fish, they do not normally arrive in

this Province now on the northeast Coast - the Avalon is a little earlier -

until usually around June 20. So there is a full month there that these

fishermen too have similar problems as the fishermen in your District, and no

doubt that needs to be addressed. That needs to be addressed, not for Eagle

River only; that needs to be addressed for the Province.

I note with some interest he talks about the work ethic. That

comes to another point of the resolution, an income support programme. What

would that do for the work ethic? What would that do? I am much concerned, much

concerned, that might not stimulate the work ethic, if we know there is going to

be a guaranteed income without some incentive to work.

Well, in fact, I am going through it on a daily basis now

with the fish aid package - where a number of fishermen are attempting to get UI

benefits, and their complaint, the complaint of many of them, is that they are

not going to get time to do gear, and then the other one is that they do not

want to work at programmes that are somewhat demeaning.

But, Mr. Speaker, in this country there is just not a

bottomless pit that we can draw money from. The Province does not have it. The

National Government does not have it, and employers do not have it; and who is

going to pay for a programme that is as large in scope as the one you are

talking about? Who is going to pay for it? How are we going to address it? It is

of major, major concern. Can we raise the taxes of those who work, even more? I

suggest you might have a revolution on your hands if that occurs. You could very

well. The Province, we are told, cannot pay any more. Does it mean that we are

going to scrap the present UI system? Is that what you are asking for, a

complete revamping, and a scrapping of the UI? Is it going to go across the

board and extend to the other 43,000 Newfoundlanders today who do not have jobs?

Are they going to be included? Who is going to be included in your Guaranteed

Income Support Programme? Does it apply to fishermen and fish plant workers, or

is it going to apply across the entire spectrum of the Province? Because if it

does, then we have one massive problem that is going to require millions, and

millions, and millions of dollars that have to come from the taxpayers, and that

is going to be very difficult.

So, if we are going to do this, we have to put a programme in

place that can be financed. If we are going to rely on the UI system as it is,

we know that already this year, I think where the Federal Government is now

going back to employers and employees looking for more contributions, because

the fund is in trouble again. We just fixed it last year to make it pay, and now

it is in trouble again. Now where is the money going to come from? That is a

real concern - a real concern.

The miner who just lost his job in Labrador, how does he fall

into the network; or the fish plant worker in Trepassey, where does he fit into

the scheme of things, who has just lost his job and now has an added $500 a

month mortgage, and he does not have any income? What happens to these people?

These are the kinds of problems. If you are going to have

this network, if you are going to have this kind of network that the Member

talks about, then that is going to be mighty, mighty difficult to put in place.

The Member spoke about people who are on social services, the

work ethic is not there, because if they go out and make a dollar, then it is

taken from them. I would like to remind the Member of an action that this

Government took some time ago, when single mothers who were receiving

maintenance support, had deducted, dollar for dollar, dollar for dollar, their

maintenance support that spouses, or whatever, estranged spouses, or parents,

were paying them.

Now, Mr. Speaker, if that occurred then is that not a

disincentive for these people to go out and look for this support? Is that not

the same? So you cannot have one and not have the other.

AN HON. MEMBER: Look at the fight we had to get - with

the student loans (Inaudible).

MR. WINSOR: Yes, the loans for single parents for that to

not count as income. What a disincentive. So we have to look through the entire

thing. Disincentives from working.

AN HON. MEMBER: This fellow corrected it (Inaudible).

MR. WINSOR: This fellow, he is going to fix it. Oh, I

know this Member corrected it, yes, sure, it is fixed, I know he did. I know he

fixed it.

AN HON. MEMBER: He's a good Minister.

MR. WINSOR: He fixed it a few weeks ago. The Minister of

Education is trying to take credit for it, by the way. I phoned him the other

day. I meant to tell you that. I phoned him the other day. He said: but you know

that good thing we did for the single mothers?

AN HON. MEMBER: Who said that?

MR. WINSOR: Oh, the Minister of Education trying to take

credit for the Minister of Social Services' initiative.

AN HON. MEMBER: (Inaudible).

MR. WINSOR: I agree. Anyway, Mr. Speaker, we on this side

agree in nature with the resolution. We think it is a good resolution. We have

some problems with it that we hope the Member is going to address in his

summation. To make the resolution more effective I move, seconded by my

colleague for Menihek, the following amendment. And at the end:

AND BE IT FURTHER RESOLVED THAT the Provincial Government

take the lead by immediately establishing an all-Party committee of this House

to initiate the necessary groundwork to bring about the desired objective.

So, Mr. Speaker, we put forward that amendment to get the

ball rolling so it is just not going to be idle talk. That this Legislature and

this House take the initiative to get on with it.

SOME HON. MEMBERS: (Inaudible).

MR. WINSOR: The Member is saying we are playing politics.

We are proposing an amendment to it now that will give it some teeth, that will

get it moving. Because other than that, it could even - even though the vote

will come - it will die on the order paper. Now we this Legislature will take

the initiative to see if we can start a process to do as the hon. Member

suggested.

Thank you, Mr. Speaker.

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

Labour.

MR. GRIMES: Thank you, Mr. Speaker. I am sure that one of

the speakers on our side, or the mover of the resolution in closing, will deal

with the merits or lack thereof of the amendment. I will not deal with that at

the present time. But I certainly expect that probably the Member for Eagle

River in his closing will deal with - I could give my own opinion right away as

to whether or not we should have a committee of the House and so on to study the

matter if it is as important as it is. But I will not do that right now.

I would like to spend a few minutes if I could addressing the

Private Member's resolution that we do have before us. I commend the Member for

Eagle River for bringing this matter to the attention of the House again today.

It is a matter that has been discussed in several different fora, I guess, if

that is the plural of forum, is it? My Latin scholars could help me with that

one. I guess that is close enough, anyhow.

But the issue has been discussed I suppose in political

circles in many areas for a long time. I would like to spend the few minutes

that I have this afternoon looking at the different parts of the resolution as

put together by the Member for Eagle River. Looking at it in the context

probably most particularly of the second

preamble discussing the seasonal nature

of employment in our Province and how people have managed over the years to

survive in that kind of an environment.

But certainly the resolution begins in the

preamble by

talking about the geography of Newfoundland and Labrador and the fact that that

creates undue cost to our citizens. That very point was referenced today by the

hon. Premier in his answer in response to some of the questions in Question

Period, in talking about our population, our geography and the kind of stress

and strain that that puts on the Government in terms of providing services to

the people that they require, in the locations that they desire to reside on an

annual basis, and an ongoing basis.

This resolution, in the reference to it by the Member for

Eagle River, talks about the cost incurred by the citizens themselves, because

of course one of their costs as indicated earlier today is higher taxation

necessary for the Government to provide the services in the areas where the

people choose to live; but the individuals themselves run into higher costs when

they try to access services that they need because of the scattered nature of

our population.

When we talk about the provision of Services, Mr. Speaker, we

recognize full well, and our colleagues and comrades and our compatriots in

similar assemblages across the country, all recognize that it is indeed a much

more difficult prospect to provide basic Government services to the population

in Newfoundland than to probably any other location in the country. When we talk

about the road links that are necessary to hook up the 600 to 700 communities in

Newfoundland; forty years ago, forty-five years ago, many of these road links

were not in place and people commuted over the waterways, but now, it is an

expectation, and we in Government say not an unreasonable one, that in this

advent of automobiles, the age of the automobile and land transportation as it

is, it is not unreasonable to expect that people, no matter where they live

might be able to go by land in a motorised vehicle to other parts of their own

province or other parts of their own country.

We have made great progress on the Island part, we are

continuing to make progress in Labrador and we certainly hope to hook up the

rest of the Trans Labrador Highway so that people there would have that equal

access, but everybody recognizes the cost to Government of providing even a

basic service like that. A lot of people when they compare what has happened now

to what it was, say at the time of Confederation, would commend governments of

both stripes that have committed in this Province to providing those kinds of

services and links, but they are not without costs and the costs are inordinate

to the Government compared to elsewhere in the country, and as the mover of this

resolution indicates, they are also inordinate to the citizens, because once you

put the road links in, a person living in one of the extremities, if he wants to

go and avail of some of the services that are in some of the centralized service

centres in the Province, then you have to incur personal expense to travel

there. All you have to do is talk about people on the Burin Peninsula or people

in the Bonavista/Catalina area who would go to the Clarenville area, because the

services that are provided in Clarenville are not matched in their home towns

and home communities.

So, the road links to make that possible are a cost to the

Government which is reflected in higher taxes to the people, which is a burden

to them. Then the individuals themselves when they go to the larger service

centres to avail of those services, incur expenses themselves. If we took our

560,000 people and put them in the down town core of some place like Montreal or

Toronto, we could service them all for a fraction of the cost that it takes to

service them right here in our Province in the Island of Newfoundland and in the

larger part of continental Labrador. So there are cost factors as indicated that

are created due to the geography of the Province that we choose to live in and

enjoy living in, the same kind of argumentation can be made, Mr. Speaker, in

relation to provision of health care services, education services, essential

basic services that every citizen expects the Government to provide to them from

the tax dollars that they give us to expend on their behalf.

So the Member for Eagle River, in his

preamble to the

resolution, rightfully points out that the geography of Newfoundland and

Labrador creates undue cost to our citizens, both directly to them when they try

to avail of services that are the norm elsewhere and we are trying to make sure

that they are the norm in this Province as well, and undue cost and additional

cost as they pay higher levels of tax to the Government so that the Government

of the day can try to provide those services to the individuals.

The second point that the resolution deals with in the

preamble, Mr. Speaker, refers to the fact that many of our people must survive

on seasonal employment, and herein again is another crux of the matter as it is

brought forward by the Member for Eagle River, in terms of debating this issue.

I think the latest numbers that are available to us in the

Government indicate that in the Province, 42 per cent of the people who are

employed in Newfoundland and Labrador are employed on a seasonal basis. Now that

is almost one half of the people who are working and work regularly in the

Province, and who have no expectation that they would work at a job that lasts

for the full year. Almost one half of them are into an economic environment and

an economic climate where the norm is that they only work for part of the year.

Therefore, one of two things has to happen: they have to earn enough money in

that part of the year that they work to sustain themselves for the full year, or

there has to be some kind of a social system or social network in place to allow

them to access income for the remaining weeks or months of the year when they

are not employed. That is a matter of fact that we have been dealing with in the

Province ever since there has been a Province, I guess, from the very beginning

of time in Newfoundland and Labrador.

We look at the seasonal nature of work in the fishing

industry, the construction industry, the tourism industry, in transportation.

The major parts of the economy are structured such that people working in those

sectors only do so on a part-time basis, and as I indicated, the latest numbers

show that in Newfoundland 42 per cent of the people are in that category. Again

it relates to the first part of the

preamble because in other parts of the

country, in Nova Scotia you would have 58 per cent - actually I should reverse

the numbers for the record, Mr. Speaker, it is 42 per cent of the people are

employed in Newfoundland and Labrador on a full-time basis, which means 58 per

cent of them are seasonal or part-time, so it is a little more than half. It is

actually in the seasonal or part-time nature of the work force, so just so we

set the record straight.

In other parts of the country and other provinces, in our

neighbouring province of Nova Scotia, for example, the numbers are reversed. It

is 58.4 per cent are full-time year round employment and 41.6 are seasonal, and

that kind of a swing gives them an advantage in the sense that you have that

many extra people in full-time employ in that province on a year round basis.

In Ontario, which is considered to be the economic leader and

the beacon in the country, 67.8 per cent of all the jobs in Ontario are full

year, full-time jobs, and you can see that in that particular case there is a 25

per cent difference between this province and Ontario. The Canadian average,

just for comparison, is 64.8 per cent across the country. So if you look across

the country, people who work on an annual basis, for rough calculation purposes

we can say two thirds of them, 64.8 per cent, almost 65 per cent, two thirds of

the jobs in the country on average are full-time year round. In our Province

only 42 per cent are in that same category.

So as you can see in the resolution moved by the Member for

Eagle River our people must survive on seasonal employment, and I think that it

is useful for us every now and then to remind ourselves of those kinds of

numbers so that we recognize the magnitude of it and know how it compares to our

neighbours in the rest of the country. So we are at a 25 per cent disadvantage

when we compare ourselves to the most economically advanced province in the

country in Ontario, and we are at a 22.8 per cent disadvantage when we compare

ourselves to the country as a whole. So there is no question that every since

the Province has been in the Confederation we have been dealing with a problem

caused largely by the seasonal nature of work and employment in the Province

itself.

There is some good news however, Mr. Speaker, that I should

report to the House. I do not know if it is a coincidence or not but it happens

to show a change since 1989. I do not want to bring any politics into this

discussion at all, but there is a noticeable change since 1989. It is a

noticeable change in employment on a full time basis in the Province versus

employment on a part time basis. I might point out to you the reference from the

latest labour market bulletin, from January to September of 1991, the most

recent one, I just might read again this item comparing full year to part year

employment.

'The changing trend observed in the composition of employment

last year has continued into 1991. Full year employment rose by about 2,000 or

1.2 per cent on average in the first eight months of 1991, compared with the

same period last year, and part year employment declined by about 6,000, or

about 8.9 per cent.' So there is a 1.2 per cent increase in full year, full time

employment, and an 8.9 per cent decrease in part year or part time employment.

That shows a continuation of a trend that has been evident in all of the

analyses of the labour markets in Newfoundland since 1989.

Prior to that there was an increase, particularly noticeable

from 1981 to 1988, and early 1989, of total employment increasing but almost 90

per cent of it was part year, seasonal, short term employment, and only about 10

per cent of it could be attributed to any full time, year round, long lasting

jobs being created in the Newfoundland economy, the Newfoundland environment. So

I just wanted to point that out for the purposes of this particular debate on

this resolution.

In addressing the third part of the

preamble - "WHEREAS

present income support programs do not have components to reflect this reality"

- that kind of a statement was made just about a year ago in this House of

Assembly by my predecessor in this position as Minister of Employment and Labour

Relations, the hon. Patricia Cowan, when in fact she introduced a resolution to

the House a year ago that was unanimously passed. It was in reference to the

Government's position, and as it turned out to the position of all Members of

the House, in opposition to the Federally proposed changes in the unemployment

insurance system introduced in Bill C-21.

This whole House unanimously went on record as saying that we

had serious reservations about the changes; that we felt that there was a

definite need that if there were going to be reductions in monies available to

residents of Newfoundland and Labrador that they normally would have accessed

through the unemployment insurance system through the old rules, that if there

were going to be reductions in the amount of monies coming into pockets of

Newfoundlanders and Labradorians through that system as a result of the changes

in Bill C-21, that the Federal Government and the Provincial Government and

everybody should look at ways and means of making sure that any negative impact

was minimized. And that some interim measures were developed to make sure that

you would pass from the old system to the new system without too adverse an

affect on the people who relied on - because of the seasonal nature of work in

our Province - particularly and most greatly, the unemployment insurance system

to sustain themselves in the periods of the year when they were not gainfully

employed and earning income.

I might remind hon. Members of the House that on November 1,

1989 the resolution that was carried unanimously: BE IT THEREFORE RESOLVED THAT

this hon. House endorse the Provincial Government's position that implementation

of the proposed changes in Bill C-21 be delayed until a financial program is

developed to ensure that people adversely affected will have adequate income

during the transition period.

Again we see ourselves here today where that was not

adequately dealt with, from the point of view of there is no noticeable

transition period allowed for. People have struggled over the last year to deal

with the new approaches and the new rules relating to the unemployment insurance

system. The mover of the resolution, the hon. Member for Eagle River, points out

that we have in fact a combination of earned income, unemployment insurance

benefits, social assistance benefits, and other forms by which people access

money in their pockets. And that it really is time for the levels of government

to come to grips with how we might coordinate all of this in a meaningful way,

as the resolution says: to look at a new income support program which will

stimulate the work ethic and maintain a reasonable level of income for all our

citizens.

In closing my few remarks I just might point out for the

House and for the record again that there is a pilot project relating to the

notion of guaranteed annual income currently under consideration with the next

meetings scheduled for November 19. There have been reports prepared by the CEIC

for a steering committee of Federal and Provincial representatives, along with

representatives of the Economic Recovery Commission. There is a symposium on

income security planned for late November or early December to again discuss in

some detail this whole issue that the hon. Member has brought before the

Legislature today.

I know it is a little bit of bad timing in the sense that the

Federal Government has already made certain decisions as a result of Bill C-21

to cease funding certain aspects of the programme that could have been useful in

tying into this kind of new income support program. But we are still hopeful

that the discussions will be meaningful and that with the support of a

resolution passed here in the House of Assembly today that all levels of

government can work together to put their best interests forward in trying to

assure that, as the hon. Member proposes, we will have a support programme that

does two things.

Notice that in the resolution I commend the Member for

indicating the two things that are of utmost importance. A reasonable level of

income to be maintained from all sources, and the hon. Member for Eagle River

has been a strong proponent of this, even long before he was elected to this

Legislature. But secondly, that there be in some way meaningful work associated

and attached to this income, so that in fact everybody would stimulate and

encourage the work ethic. And in whatever way and whatever methods people can

find to be creative or ingenious, or whatever it takes to meet these two

objectives, that I think all of the citizens of Newfoundland and Labrador - and

if we can lead by example through the pilot project which we are hoping to put

forward in Labrador or in other ways - then all of the citizens here as well as

across the rest of the country will be very well served by such an initiative.

Thank you, Mr. Speaker.

MR. SPEAKER: Before recognizing the hon. Member the Chair

would like to inform all hon. Members that the amendment put forward by the

Member for Fogo is indeed in order. At the same time I want to welcome a

delegation from the Marystown Town Council. They are in the Speaker's Gallery.

Mayor Jerome Walsh and Deputy Mayor Hodder, accompanied by Councillors Brenton,

Keating, Ducey, Baker and Synyard. Also, Town Manager Jim Mayo, and Mr. Harvey

Lunan (?) from the Burin - Marystown Chamber of Commerce.

SOME HON. MEMBERS: Hear, hear!

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

MR. WARREN: Thank you very much, Mr. Speaker. As I said

yesterday when my colleague brought forth this resolution, I believe it was a

good resolution and I have no problem at all supporting it. However, I am sure

that the hon. Member and those opposite will also support the amendment to the

resolution. It is no good for us to continue to debate such a resolution unless

we take action on what we are saying. The reason I say that is I went and dug up

Hansard this afternoon from May 28, 1986. May 28, 1986, I say to my hon.

colleague for Eagle River, there was a resolution then by Mr. Patterson from the

district of Placentia. I want to read some of the whereases in the resolution in

'WHEREAS disadvantaged Newfoundlanders and Labradorians

continue to suffer the indignity and ravages of real poverty;

AND

WHEREAS poverty is oftentimes an inherent problem amongst

the disadvantaged;

WHEREAS the increasing cost of living continues to be an

insurmountable burden and places poverty-stricken families at a level below

subsistence;

AND

WHEREAS poverty contributes to a host of social ills

affecting the entire community;...'

So, Mr. Speaker, those same whereases are consolidated in

what my hon. colleague for Eagle River has said in his resolution. So we have

been debating this now, as far as I can determine, since 1986 when Mr. Patterson

brought in this resolution. I would suggest to my hon. colleague he should go

and dig up this because Mr. Roger Simmons at the time, the Federal Member now

for the southwest coast -

AN HON. MEMBER: (Inaudible).

MR. WARREN: No, in fact, Mr. Barry was leader at the

time. But Mr. Roger Simmons brought in an amendment to the resolution, and it is

interesting to know what the amendment said. Now, let me just see if I can find

out where the amendment was.

Now, Mr. Speaker, let me just try to find it. I just had it

there that second but I must have lost it somewhere along the way. Let me see.

Yes, why don't you have a peep at that while we're waiting? The amendment was

basically the same thing as the former Minister of Labour Relations brought in

last spring, it was: don't tamper with our Federal programmes unless we are

going to put something else in place first.

Mr. Speaker, I must say, I apologize for my voice today

because I am not feeling - I've felt in better shape, put it that way. What I

want to say to my hon. colleague for Placentia is that I want to say this for

the record. I think that we have to get rid of the unemployment insurance that

we have in our country. The unemployment insurance program that we have in our

country is not working. The only way to get rid of it is that is has to be

replaced by something better, something that will help all people in their

particular circumstances. I was listening to my colleague for Eagle River when I

was up in the library earlier when he was talking about the disparities in the

unemployment insurance. I have to agree that there are too many disparities in

the unemployment insurance program that we have in our country. It is

interesting to note that the Federal Governments of Mr. Trudeau and Mr.

Mulroney, have, neither one of them, did or will change the unemployment

insurance act.

Unfortunately it is not going to benefit those who need it

most. Because it is going to - thank you very much, Mr. Leader. See how

competent our Leader is? Just like this, went and found the resolution. As Mr.

Simmons said:

'THEREFORE

BE IT RESOLVED THAT this hon. House urge the

Government to implement a guaranteed annual income for all Canadians to insure

universal income security and to avoid tinkering with family allowances,

unemployment insurance, or any other national income security programmes, until

such a universal programme of guaranteed annual income comes into place.

AN HON. MEMBER: Who said that?

MR. WARREN: Mr. Speaker, that was an amendment to the

resolution by, I think at that time, the Member for Burgeo - Bay d'Espoir, Mr.

Simmons.

AN HON. MEMBER: Fortune - Hermitage.

MR. WARREN: Fortune-Hermitage? Maybe so.

AN HON. MEMBER: Yes, Fortune - Hermitage.

MR. WARREN: Okay, Fortune - Hermitage.

So, Mr. Speaker, we can see that even back in 1986 we were

still concerned about a guaranteed income. My hon. colleague from Fogo brought

in the amendment today that we really need to put our teeth into this resolution

that was brought forward. I cannot, for the life of me, see my colleague voting

against this amendment. Mr. Speaker, I cannot see anybody on that side of the

House voting against this amendment.

Now, Mr. Speaker, what we are saying, and what we are saying

to our colleague from Eagle River, is that we are willing to help you achieve a

successful conclusion to this resolution. We will do this by saying to the

Government that is in power, would they kindly immediately set up a select

committee of the House - Mr. Speaker, I am willing to say to you, Sir, that I

would love to be on that committee with my colleague from Eagle River.

AN HON. MEMBER: No, you would not.

MR. WARREN: Yes, Mr. Speaker, because if there are any

two people in this Legislature who know about people who are on low income they

are the Member for Eagle River and myself. If there are any two members in this

Legislature who know more about people on low income who need assistance and

cannot get assistance, they are my colleague from Eagle River and myself.

Mr. Speaker, I know my colleague, the Minister of Social

Services, should know but it is going to take him a while to understand the

plight of those people in the remote areas of our Province who have to live on

as low as $3,000 a year for a family of three. But for embarrassing the family,

Mr. Speaker, I could name a family whose income last year was $3,000 for a

family of three.

MR. MATTHEWS: Is that with or without a drug card?

MR. WARREN: Mr. Speaker, I would suggest to my hon.

colleague from Grand Bank that there is no drug card required on the Labrador

Coast because it is under the Grenfell Association and drugs are very

reasonable.

AN HON. MEMBER: Really!

MR. WARREN: Yes, and that was instituted by a former

government in this Legislature, Mr. Speaker. It goes right back to the early

1950's.

MR. SIMMS: The same government that brought in school

tax.

AN HON. MEMBER: School tax and (inaudible).

MR. WARREN: Yes, Mr. Speaker, but let me say to the hon.

the Minister of Health that this past year the people are paying more for their

drugs on the coast of Labrador than they were two or three years ago. So the

Minister should not shout too loud.

Mr. Speaker, a guaranteed income is a necessity for many

people in this Province. Maybe there is a perception out there, I guess, whether

it is Newfoundland, Labrador or any other province in this great country of

ours, if I have a guaranteed income why do I work? That perception is going to

be out there. Regardless of where you live, there are always going to be people

out there who will say: if I am guaranteed an income of x number of dollars a

year, why do I have to go to work? I will get up if I feel like getting up in

the morning and I will work if I feel like working. This attitude will still

exist among a minority of people.

Mr. Speaker, we have to assure that a guaranteed income is

instituted by the Federal and Provincial Government, not only guaranteeing the

families that they are financially looked after but, at the same time,

guaranteeing the Province, as a whole, that work will continue.

I have to go back to a situation with the Hibernia

development, and I want to tie this into this whole thing, because the number of

fishermen in Sunnyside, in my home town of Chance Cove, and in Bellevue itself,

in those three communities - I do not know if it is thirty-three fishermen or

thirty-eight fishermen but for the next five years a number of those fishermen

are guaranteed 75 per cent of their income on average over the last five years

while fishing in those three areas. Mr. Speaker, now naturally they are going to

have to prove they were fishing and were unsuccessful but, Mr. Speaker, they are

guaranteed an income.

Mr. Speaker, if a consortium such as Hibernia can guarantee

this for a number of fishermen, surely goodness we as parliamentarians and this

Government can do something - when the Premier is always saying fairness and

balance, his words have been fairness and balance. What a move by this

Government today to pass this resolution as amended and get the Member for Eagle

River, myself, and one other person to go around this Province and get the views

and ideas of other people on how we can implement the programme properly. Then

when the Premier brings down his budget in the spring of the year he can

announce that the Provincial Government is ready to go forward with their

commitment to the income supplement and that will force the Federal Government

then to act accordingly. If not then, this House can condemn the Federal

Government for not progressing favourably.

MR. SIMMS: With you and the Member for Eagle River on the

Committee and insist that you do your work when the House is open.

MR. WARREN: Mr. Speaker, I think this can be done in two

months in January and February. This can easily be done if we just pass it

today. I can tell you this much that it will be one of the most in-depth reports

that ever was presented in this Legislature. There will be so much substance to

it the debate will go on for months because we would have the answer for every

question any Member or anyone else would ask, because we would talk to the

people. Mr. Speaker, I can assure you that my colleague will take the same

slogan that our Leader has taken, we will put the people first.

With those few remarks, Mr. Speaker, I will take my seat and

I will support the amendment as presented by my colleague for Fogo. I have every

confidence in my colleagues opposite that they will also support this

resolution. Let's get a select committee started immediately. The Premier will

come in tomorrow or Tuesday or Wednesday of next week and announce who will be

on the Committee, I know who our side is going to nominate already, so there is

no problem on our side.

Thank you very much, Mr. Speaker.

MR. SPEAKER: The hon. the Member for Trinity North.

MR. OLDFORD: Mr. Speaker, it gives me great pleasure to

rise and speak to this resolution that was so ably put forth by my colleague

from Eagle River. Of course, when it comes to social issues we can always count

on the hon. gentleman to be in the thick of the debate and be up front fighting

for the welfare of Newfoundlanders and Labradorians.

Mr. Speaker, if there ever was a time when the issues raised

in this resolution needed attention, I think it is now. The country wide

recession, the failure that we have experienced in the fishery, the downturn in

the other primary industries and the overall general negative impacts on our

economy should certainly give rise to discussions on how we as Government

support the less fortunate in our society.

Mr. Speaker, we must question the effectiveness of our

present income support programmes. We must question the inequities that the

present programmes promote between Provinces with sparse populations like

Newfoundland and Labrador and other more richer and populated Provinces like

Quebec and Ontario. There are inequities which exist too within provinces,

between rural and

urban areas of provinces. We must question the gaps that

exist between the rich and the poor, the working rich and the working poor. We

must determine whether our present social programs, like social assistance, and

UIC are meeting the needs of our people. Are they really doing what they were

intended to do?

We must ask: are stop gap measures like UI the answer in this

day and age, or are they really adding to the misery that exists in some

sections of our society and our economy? Mr. Speaker, if we work from the

premise that everyone in our society is equal, or should be equal, then should

we as a Government, both Federal and Provincial, not work towards a programme of

income support that allows for income equality? It does not matter whether we

live in Vancouver, Makkovik, or in Port Rexton, we need a system of income

equality in this country because that is fair, that is just and that is

reasonable. I feel quite strongly that the economic contribution of a fisherman

or a fisherwoman in Old Bonaventure who makes $10,000 a year working in an open

fishing boat, or a fish plant worker in Fogo who makes $10,000 a year, have an

inherent right to a decent total income to support their families. A person

should not have to go on bended knee to Governments looking for assistance. His

or her contribution is no more or no less valuable to the Canadian economy than

is the contribution of a factory worker in Ontario making $50,000 a year or a

lawyer in St. John's making $150,000 a year. That is because we have to consider

the geographical and climatic circumstances under which we exist in this

Province.

Mr. Speaker, our present UI programme is flawed. It does not

seem fair that UI benefits paid to a worker making $10,000 a year is paid at the

low end of the benefit scale while a worker who is displaced from his or her job

after making $50,000 a year is paid at the upper end of the benefit scale. One

would reason that from a social perspective the opposite would be the case. If

UI is a stop gap measure meant to allow people an income while seeking alternate

employment one has to question where the need is greater. Reasonable people

would reason that the lower your income the greater is your need for income

support from Government. The Federal UI program as is presently structured does

the complete opposite and I suppose, as the Member for Eagle River suggested,

the rich get richer and the poor get poorer.

Mr. Speaker, there is a stigma attached to our present day

social income support programs. I have met with individuals over the past few

weeks who, because of the recession and the failure in the fishery, are

contemplating seeking social assistance for the first time in their lives. They

have gone from Fort McMurray, through Ontario, to Toronto, and back to this

Province seeking employment. They are people who have fished for most of their

lives and because of the problems in the fishery some of them have received very

low unemployment benefits. In order to survive they will have to request

additional benefits from social services. These workers have contributed to our

economy for a number of years. They have faced uncertainty in previous years,

but fishing is their way of life and they do have a will to work.

Mr. Speaker, people in our primary industries, as in other

walks of life, need the assurance that they will have income support programmes

that will allow them the means to support their families with dignity when there

is a down turn in our primary producing industries. It is my personal view that

Canada should provide, as a matter of right, sufficient income to support an

adequate standard of physical and social wellbeing for all its people.

SOME HON. MEMBERS: Hear, hear!

MR. OLDFORD: This is based on the principle of social

justice, which should be afforded to all Canadians, regardless of where they

choose to live in this great country. We need an income support program that

says to someone on social assistance, you have a right to an income that

supports your aspirations and those of your family. We need an income support

program that says to these people, you have a right to share in the wealth of

this great country, even though you are socially disadvantaged. We need an

income support program that says to those who are temporarily unemployed due to

circumstances beyond their control, you have a right to a decent living, you

have contributed to the economic growth of this great country, and government

has an obligation to support you in a decent and just way during this temporary

period of unemployment.

Mr. Speaker, I support this resolution because, in my

opinion, it promotes the premise that we are all equal in this country and all

citizens deserve a reasonable level of income to support their families in good

times, as well as in difficult times.

Thank you, Mr. Speaker.

SOME HON. MEMBERS: Hear, hear!

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

Capes.

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

First of all, let me congratulate the former speaker on his

maiden speech in the House. He did a good job and made some excellent points.

Actually, all the speakers who have spoken so far on the resolution have been

making points which show that they are in agreement with the resolution, itself.

Hopefully, the amendment, then, proposed by the Member for

Fogo, will also receive the agreement of those opposite, because we have been

talking about this for quite some time. The Member for Exploits, when he spoke,

gave examples of statements that were made by his predecessor suggesting such a

thing quite some time ago, and it has been a plank in the platform of the

Government, and undoubtedly, will be one in the upcoming election. So if that is

the case, if members opposite really feel it is about time we addressed this -

everybody else is saying, Richard Cashin, for example, every time he speaks to

his membership, makes no bones about the fact that this should be addressed. And

people who really understand what is happening in society will say that the

present support programs are neither proper nor adequate, nor can they be

properly monitored. Consequently, we have to find a better way to address the

social needs of the people in the country. Specifically, here in Newfoundland,

where we are worse off than in most provinces, we have to find a special way to

do something about it.

What is wrong with being the ones to really initiate such an

activity? And if the Federal Government agrees, Yes, we agree this is the way to

go, someone has to start the ball rolling. So what we are saying is, perhaps if

Newfoundland, if the Government here, decided to roll up its sleeves and start

the ball rolling -

AN HON. MEMBER: (Inaudible).

MR. HEARN: Yes, exactly. If the Government is serious

about what it is saying, if government members are satisfied to put their

efforts and their money where their mouths are, then perhaps we can initiate

some action by setting up a committee, as we suggest, or some other form of

organization to get the ball rolling, and put some pressure on the Federal

Government to join us in providing some proper stabilized income for the people

in our Province and in the country generally.

Let's have a look, Mr. Speaker, at some of the programs that

are presently available to people in the Province who have to depend upon

government support. The first one we probably think of is Unemployment

Insurance, and there are more loopholes in Unemployment Insurance than in any

other scheme, I suppose, that anyone could think of. You have people who work in

construction, people who work in factories, people who work in mines. Let us

take Labrador for an example. Every now and then, they will have a slow down and

for a few weeks they are off, their work is disrupted. Many of these people are

working thirty, forty, or forty-five weeks a year, and when there is a slowdown,

or the work is disrupted, there is an unemployment insurance plan which helps

them offset a loss of income, and it is great, because it fills in those few

dead weeks, or sometimes months, between jobs, or while as I say, their factory,

or the mine, or the construction job is shut down. Then, on the other hand, you

have people involved in seasonal industries, especially the fishery, where

sometimes it is practically impossible to come up with even the minimum required

weeks to obtain UI, ten weeks in most parts of Newfoundland. So, for many of

them, most of their income is coming not from the job or the profession or the

occupation in which they are involved, but from the social programs that back up

such jobs, and, in this case, unemployment insurance.

One of the things that the Government has to do is clean up

the mess in relation to social programs, both governments as far as that goes,

but, particularly, the Federal Government, as it applies to the unemployment

insurance schemes. There are so many abusing the system, that if the system is

properly cleared up, there would be a tremendous amount more assistance for

those who legitimately qualify for such assistance. I am not against anybody

trying to make a living and use what social programs are available, that is why

we bring in social programs, but I certainly cannot support somebody who is

ripping off the system, and there are so many loophole