May 3, 1999

RESOURCE ESTIMATES COMMITTEE

The Committee met at 7:00 p.m. in the House of

Assembly.

Pursuant to Standing Order 87, Roger Fitzgerald,

MHA for Bonavista South substitutes for Robert French, MHA for Conception Bay

South, and Gerald Smith, MHA for Port au Port substitutes for Yvonne Jones, MHA

for Cartwright-L'Anse au Clair.

CHAIR (Reid): Order, please!

I want to introduce the estimates for the

Department of Fisheries and Aquaculture. The meeting that we are supposed to

have on Thursday at 5:00 p.m., is that alright with everyone?

AN HON. MEMBER: (Inaudible) 5:00 p.m. right

after the House (inaudible).

CHAIR: Right after the House sits on Thursday

we will do the estimates for the Department of Tourism, Culture and Recreation.

We are going to do the estimates for the Department

of Fisheries and Aquaculture tonight. Just tell me if you have any problems with

the procedure we have here. I think it is the one that has always been followed.

We give the minister fifteen minutes to introduce his estimates, we give fifteen

minutes to the person responding, and then ten minutes each. You can speak as

long as you want after that and have as many ten minute sessions as you want. Is

that alright with everybody?

We will call on the minister to give his fifteen

minutes of introduction and when he is finished with that, or before, maybe he

can introduce the staff he has with him.

MR. EFFORD: On my left is the Deputy Minister

of Fisheries and Aquaculture, Leslie Dean. The Assistant Deputy Minister

responsible for aquaculture is Gerry Ward, who is sitting on my right.

Immediately behind me is Brett Wareham, responsible for fisheries development.

The Executive Director is Mike Warren of the Department of Fisheries and

Aquaculture.

Mr. Chairman, I do not know if I will take the

fifteen minutes but I will take some time to make some comments about the

Department of Fisheries and Aquaculture. I will begin with saying clearly it is

my pleasure and our pleasure to present to the Committee the budget estimates of

the Department of Fisheries and Aquaculture for the fiscal year 1999-2000.

This is my fourth presentation on behalf of the

Department of Fisheries and Aquaculture. I think it has been a challenge but

nevertheless a rewarding challenge. The accomplishments we have achieved over

the past almost four years will be outlined in my

preamble and hopefully come up

in the questions and discussions for the rest of the evening.

The Department of Fisheries and Aquaculture has a

responsibility for promoting ongoing developments in the harvesting, processing

and marketing sectors of the fishing industry, and in particular, articulating

policies relative to the management of fish resources. I think if there is any

one issue that is of most importance today it is consultation and promoting the

fisheries management resource to DFO. I think all of us look back on our past,

regardless of our positions, but when we are talking about fisheries and

aquaculture and fisheries development in the Province, I think if we are going

to have a challenge and we are going to try to move forward, our biggest

challenge is trying to work with the federal agency, DFO, and try to change and

try to get the micro-management, I guess, somewhat diminished into allowing our

fisheries development in the Province to move forward.

There are comprehensive programs relative to

technical innovations, resource development, aquaculture development,

productivity, and in particular quality enhancements. If there is any one thing

that I am and we are most proud of over the last three-plus years it is the

quality enhancement we have moved forward in provincial fisheries in the

Province. Because prior to 1996, quality was the responsibility - we call it the

QMP program - of the federal agency. I don't think anybody in the Province,

anybody in the fishing industry, was satisfied with the quality program that was

put forth by the federal government, and particularly the marketplace. I think

if we are going to be satisfied with our quality initiatives we have to look to

the marketplace. When the marketplace says: Yes, we are happy, we think the

quality initiatives are to our satisfaction, then we say: We are moving forward.

If that does not happen then we all have to take a look at where we are going.

In 1996 the provincial Department of Fisheries and

Aquaculture took a major step forward. We made some major changes to quality

handling of the fisheries' harvesting-processing sector. We looked at it simply

this way. From the time a species of fish comes out of the ocean until it

reaches the marketplace we must handle that product as if we are going to eat it

ourselves. I think we began from that concept and we moved forward. The results

that we have gotten back from the marketplace, as recently as the Boston Seafood

Show, have been very positive. The result is that our department, and the

inspectors and the quality assurance program has been moved ahead as to - what I

call a considerable success.

As recently as last Friday I spoke in Toronto to a

convention from a council of representatives of the UFCW, United Food and

Commercial Workers from across Canada. For some strange reason, a lot of people

in this Province and a lot of people across Canada still think today there is

not a lot of fishing activity in the Province. Let me quote you a few numbers.

The industry in 1998 employed 27,000 individuals: 14,000 in the fishing

industry, 13,000 in the processing. An additional 7,600 individuals are employed

indirectly in service support and related industries. That has nothing to do

with the spinoff factor, the one if you relate it to direct jobs and how

(inaudible) into the spinoff factor you multiply by 1.5. Those are direct and

indirect jobs related to the fishing industry.

As work in the industry is often seasonal,

comparative employment data with other industries must be expressed on the basis

of full-time equivalent employment. Accordingly, the industry provided 16,700

person years of direct employment: 10,500 in fishing and 6,200 in processing.

Some 5,100 person years of employment were generated indirectly. The fishing and

processing industry provided 11 per cent of total provincial employment in 1998

and 35 per cent of employment in goods producing industries.

Fisheries development is a core activity of my

department. Initiatives are directed towards identification and assessment of

underutilized species and new resource opportunities that hold commercial

potential and help diversify the resource base of the industry.

That paragraph there, even though it is short, says

what we should have been doing years ago and what we must do today and must do a

lot more of in the future. Our history shows that we place too much dependency

on too few species. When the groundfish industry collapsed we found we had major

problems. We must never allow that to happen again. We have to look to whatever

possibility of resource development, or the species in the marine life in the

ocean, and look at the value and how it can be commercialized.

An example of that is very clear. In the country of

Japan they consume, on average, 450 different species of marine life. The

maximum species that we develop today, we harvest today, in this Province is

forty. We do not know that we have 450 but we certainly know there is more

marine resource available in that ocean than forty species. We have to look at

and we have to do more on research and development. We have to have a vision and

we have to explore whatever opportunities exist.

If you look at one alone - and today I'm still

trying to promote it, I'm still trying to get private industry involved - it is

seaweed. We have not even begun to tap our seaweed resource. Nova Scotia

produces $25 million worth a year. China produces $1 billion worth a year. You

go into any Asian country and look at the marketability of seaweed for food,

medical, and research. Roger Organ, down in Ramea, for argument's sake, is

developing seaweed. Where is he selling a lot of? Down to the thoroughbred

racehorses in Kentucky.

We have to look at all opportunities and we have to

look at where we can develop other opportunities and never again allow ourselves

to be dependent upon a few species: again, codfish in the past, and today most

of our dependency is on shellfish. We all know the state of the codfish industry

along the northeast coast. There is a bright light in 3PS. In 1998, the TAC was

20,000 tonnes. That is expected to be increased in 1999. I do not think it is

out there yet. It will be announced soon, and there should be a substantial

increase in that according to the scientific information that is being put

forward, but we will wait and see over the next few days what it is going to be.

The total allowable catch for a limit in 4RS and

3PN fishery has not yet be announced for 1999. As well, the existing turbot and

redfish fisheries and the limited reopening 3LNO yellowtail flounder fishery

will provide a modest increase to the overall groundfish landings. Groundfish

landings increased by 14,000 tonnes in 1998 to 52,600 tonnes with a landed value

of $58 million.

While recovery of the groundfish stocks is taking

place, shellfish resource will carry the fishery into the new millennium. I have

concerns about that, and I think the Auditor General pointed that out recently

to the federal minister. Because if all of the pressures that are being applied

today continue in the next number of years on the shellfish stock, we all have

to stop and take a look at where that is going to be four or five years down the

road.

I guess that is one of the reasons why we have been

placing so much energy in the all party committee that went to Ottawa to place

pressure on the Minister of Fisheries and Oceans to look at conservation in the

groundfish stocks and apply conservation right across the board to ensure that

an appropriate management plan is put in place, that the groundfish stocks will

recover, in particular cod, and will ease off the pressure from the small boats

and a lot of fishermen that are now demanding a living from that shellfish

species.

Not only is it a major part of the world food

chain, not only is it a major part of the economy, but it is a protection for

all species. Because if you apply too much pressure on any one species then we

will repeat our history and you know what is going to happen.

The snow crab fishery continues to be of particular

importance to the industry. In 1999-2000, the quota is 61,185 tonnes of snow

crab. That is another reason why I am saying we have to be careful about the

amount of pressure we are putting on the species. While it is good today - the

harvesting that already started two weeks ago shows a good stock out there - we

have to ensure that it is good not only for 1999-2000 but for many more years to

come. We have to make sure that conservation measures are applied.

Now, to the northern shrimp fishery. Remember, two

years ago we did not have an inshore northern shrimp. Today the quota available

to inshore effort has increased from 29,800 tonnes in 1998 to 41,000 tonnes in

1999 in shrimp fishing area 6. The biomass of northern shrimp in that area is

estimated at 475,000 tonnes and we will fish this resource to an exploitation

rate of 12 per cent. Clearly the level of effort is well within the bounds of a

conservation harvest, but we have to make sure again that this is not short-term

but long-term. As much as the industry people have spoken about it, while the

biomass is large, the amount of harvesting for conservation (inaudible) but for

marketing conditions. Because if you take the quota and you put that up to

150,000 tonnes to 200,000 tonnes out there, you know what is going to happen in

the marketplace. You have to weigh all of the possible consequences and make

sure the judgements you make are protecting the industry, the viability and the

amount of money that you can derive from the industry today, not only today but

for the long-term.

Shellfish with a dockside value of $295 million in

1998 represents 80 per cent of the landed value of commercial sea fish. Of these

fisheries, both crab and shrimp each provide an income in excess of $100 million

in the Newfoundland and Labrador fishing effort, with offshore clam and lobster

providing $25 million and $24 million respectively. The Newfoundland offshore

surf clam fishery had landed approximately 15,000 tonnes of shell stock annually

in each of the past five years. The landed value in 1998 was $25 million.

Similar (inaudible) in landed value has been forecasted for 1999.

Our sealing industry continues to be an important

contributor to the overall fishery and the economy. Approximately 3,000 sealers

and 300 plant workers received income and employment from the industry which had

an export value of approximately $20 million in 1998.

I am not going to get into the details about the

seal oil capsules and all the other things because we know that market is going

to grow but the forces of the IFAW, their propaganda campaign... Last year, as

Roger knows, when we were in Ottawa, they reported in their annual report that

they raised $56 million U.S. That is about $80 million Canadian.

For us people here in Newfoundland and Labrador to

fight that kind of a propaganda campaign is almost - absolutely impossible, not

almost. It is impossible. They are going to continue, but unless the federal

Minister of Fisheries and Oceans of Canada makes a decision in favour of the

Newfoundland support, of not only the present sealing industry but the reduction

in the seal quota, the number out there, then nothing will change. They will

continue. They do not want to see the sealing industry stopped. They want to

continue; because as long as it continues, as long as they print their glossy

magazine pictures about all the falsehoods - about Newfoundlanders being

barbarians and killing whitecoats, which we all know is not untrue - the money

will keep flowing in. They do not want to see anything change.

The sealing industry must be a major part of

development for the future of the people involved into it, but we have also have

to recognize there is a major problem out there with an overpopulated seal herd.

That is the reason why the Northeast Coast of Newfoundland and Labrador and the

north areas of Newfoundland and Labrador are showing very little recovery in the

codfish industry.

You have seen what has happened over the last

several weeks with the videos of cod being corralled in the coves and millions

of pounds being destroyed. I just heard in the last couple of days it happened

again, I believe, in Lethbridge, down around that area, where cod came in and

people just hoarded them off the beach and took them away, and DFO just turned

their back on them and let it happen.

Aquaculture has been a challenge since day one in

the Province, and not only in the Province but it has been a challenge

worldwide. It has been a very high risk industry. If we are going to move

forward in the aquaculture industry, environmental conditions have to be right

but I think private industry has to play a major role in the development of the

aquaculture industry. We have made significant gains in this Province and we

have made a decision now that we have put a loan program in place for the

increase in the mussel aquaculture industry. I think it is moving forward in

strides. I think over the next three to five years we are going to see major

increases in the mussel industry.

The fin fish industry, as everybody knows in the

Province, has undergone extreme circumstances over the last year, but we have

made a decision as a government. What we have done with the fin fish industry in

Bay d'Espoir is now final. If it is going to move forward, it has to move

forward with the proper investment from the private sector in management and

dollars.

The one thing we are happy about, I suppose, is

that one of the things that held the aquaculture industry back in Bay d'Espoir

was the restriction that was placed on the industry by the strains of fish that

they were allowed - or not allowed - to bring, or the strains of fish they were

bringing. That was certainly a major impediment about making a profit and moving

forward.

We have convinced Ottawa, with the appropriate

criteria put in place to predict the escapement of the diploids, they are now

allowing us to bring in the female diploid steelhead trout. I think over the

next three of four years that will certainly help the fin fish industry move

forward. If all the management is in place, the female diploids will be a major

component to having profitability in the aquaculture industry.

I firmly believe that the aquaculture effort's

potential for employment for many rural areas in our Province and the

development of this industry requires clear direction. We will certainly take a

lead in working with them through research and development.

We have made many changes in the framework of the

processing industry. I will just quickly go over two or three things and then I

will conclude. When I came with the department in 1996, there were well in

excess of 200 fish plants in the Province. They certainly were not operating,

but there was a licensing ability for those plants to be operable.

We looked at the numbers of fish plants. We looked

at the amount of resources available, and everybody in the industry recognized

there were too many plants. You could not go out there and say you are not

getting a licence, because you had to look at the number of years those plants

existed, and the proponents. Some of the owners of those particular plants were

families over a number of years and they had made significant investments. We

thought it was unfair just to make a blanket policy to cancel your licence, so

we put a policy in place that allowed the transfer of licences. We looked at a

regional basis in the Province - based on a regional basis in the Province -

where there were no fish plants and in my area - in particular the Avalon

Peninsula - where there were fifty-seven plants. We knew there were too many out

there, so we said we would allow a licence to transfer from one area of the

Province where there were not enough in another area.

We looked at a core policy based on processing of

1,000 tons from 1987 to 1991. If somebody wanted to become core in an area of

the Province where there were not enough core plants, they could buy one, two or

three licences, transfer them, and make up that core licensing policy. That gave

the ability to someone who wanted to become core to be able to avail of all the

licences, be they multi-species operations, but it also gave the ability to

somebody who had significant investment and was not going to be able to recover

their investment a chance to get some of their investment back by selling their

licences and allowing that owner to make up.

Apart from that, we looked at the transfer of

licences and the making up of a core policy. We looked at, as I already touched

upon, the quality initiatives. Then we looked at reducing the number of plants

in the Province.

Another thing that we said was, if a licence was

inactive for a two-year period we would cancel it or that licence would be taken

off our books.

A review of the plant activity of 1997-1998 has

identified thirty-three plants, including the 169 above, that were not active in

either of those years. It is a policy of the department to remove any processing

licences inactive for a two-year period.

Plant ownership operators have the right to appeal

the non-renewal of a processing licence. In other words, in 1989, 215 primary

processing licences were in place. If we cancel licences because they were

inactive for a two-year period - and let us take an area of the Province where

there is not a lot of activity in processing - they would come forth to the

Province with a proposal, in other words an appeal, and we would give

consideration. If it made sense that a particular area of the Province never had

enough processing, and a need or a demand for processing, we would consider

reactivating that licence. They would have to make a good business case for that

licence.

In 1998, there were seven plants processing shrimp.

In 1999, we expect two more. Well, we do not expect two more; we know one is

going to be in Jackson's Arm and Black Duck Cove and St. Anthony, so there are

going to be ten altogether. There is one being considered for Labrador. The

Labrador Shrimp Company is talking about it. I do not know if they have made

their final decision. They are talking about putting a shrimp plant down in

Charlottetown, and Fogo Island Co Op have expressed an interest.

Apart from that, right now today, in 1999 there

should be about ten plants operating. I am getting a bit concerned. We have

talked about holding the line there. We are having consultation with FANL and

with the industry and we will make a decision on that further along.

I thank you, Mr. Chairman, I recognize the time.

The final comment I will make, being down to the Boston Seafood this year and

looking at the export value of fish products out of the Province last year -

$700 million - with the increase that is expected with the increase in crab, the

increase in shrimp, and some increase in the cod stocks, cod quotas in 3Ps, we

expect to go over $800 million in 1999.

The good point that I want to make is that the

response from the marketplace with our quality control initiatives, with

resource development, diversification, we are getting an excellent response from

the marketplace. I am looking forward - and we are all looking forward - to the

fishing industry of the future providing a substantial income and being the

backbone of the economy of the Province in rural Newfoundland and Labrador.

Thank you, Mr. Chairman.

CHAIR: Thank you, Minister.

Before we go on, to get the Clerk to read the

headings, I would like for the Committee to read their names into the record. We

can start with Mr. Collins down here on the end.

MR. COLLINS: Randy Collins, MHA for Labrador

West.

MR. SWEENEY: George Sweeney, MHA for

Carbonear-Harbour Grace.

MR. HUNTER: Ray Hunter, MHA for

Windsor-Springdale.

MR. RIDEOUT: Tom Rideout, MHA for Lewisporte.

MR. FITZGERALD: Roger Fitzgerald, MHA for

Bonavista South.

MR. PARSONS: Kelvin Parsons, MHA for Burgeo &

LaPoile.

MR. SMITH: Gerald Smith, MHA for Port au Port.

MR. JOYCE: Eddie Joyce, MHA for Bay of Islands.

MR. REID (Chair): Gerry Reid, MHA for

Twillingate & Fogo.

Minister, your officials should name themselves

when they speak, for the Hansard.

We will go to you, Mr. Rideout. Before we do that,

Elizabeth has to call this one.

MS MURPHY: 1.1.01.

CHAIR: 1.1.01.

I guess it is you, is it?

AN HON. MEMBER: (Inaudible).

CHAIR: It doesn't matter.

The hon. the Member for Bonavista South.

MR. FITZGERALD: Thank you, Mr. Chairman.

Minister, listening to your report, in your

preamble at the opening of the meeting, you are 100 per cent right, and it is a

job for anybody to disagree with you, what the fishery is worth here in this

Province today. I can see it firsthand in my own district when you look at fish

plants like Port Union, Bonavista, and Charleston, right in that little area,

right in that peninsula, within thirty miles of each other.

Back prior to 1992 we had a fish plant in

Charleston that was doing in excess of 600,000 pounds of fish in twenty-four

hours, 300,000 pounds of fish in one shift. Then you go over to Bonavista where

you had in excess of 500 people employed - 1,300 in Port Union, 500 in

Bonavista, and another 300 in Charleston. In a little area - I think my district

has a population of something like 14,000 people - you probably had well in

excess of 3,500 people directly involved in the fishery.

You are right, the fishery is probably worth more

today in export value than it was back in the 1980s, but the problem we are

facing, as you know, is that the numbers are not there and I do not know if they

will ever be there. They probably will not when it comes to people being

employed.

In Port Union right now they have a new, modern,

state-of-the-art shrimp processing plant. Where once there were 1,300 people

employed, now 135 people find a job there for fifteen to sixteen weeks a year.

Sometimes I think about what is happening in the

capacity that we are bringing forward there, and I fear it might end up like

what is happening in our crab processing industry. I totally disagree with your

decision to expand the number of crab processing plants -

WITNESS: You do?

MR. FITZGERALD: Yes, I do.

- that you put around the Province. You certainly

did not put them in the locations that you were talking about. In some areas you

see as many as three or four crab processing plants within fifteen minutes of

each other.

MR. EFFORD: (Inaudible).

MR. FITZGERALD: Down on the Southern Shore, I

say to the minister. He knows very well where they are. I do not think they are

strategically located. I do not know what criteria the minister used when he was

putting the crab plant processing capacity forward, but it was certainly not the

right thing to do as far as I am concerned.

I think in most cases all we did was transfer jobs

from one area to another. You can see that right in my particular area now where

you have FPI almost playing one plant off against the other. I think that is

wrong, now that they have the one up in Triton. I think it is wrong for them to

use one against the other in that kind of way, I say to the minister. It is

something that the unions will probably be dealing with as well.

Quality - there is no doubt we have come a long way

with quality. I worked in the fishing industry myself. I worked in a fish plant

for thirteen years. I remember going to work there first and we would not think

about eating something that was processed in that plant. You would go out to the

store and buy fish, but you would never bring home fish that came from the plant

where you worked.

Today the attitude is completely different, and it

has been different for quite some time. Some of it is because of the efforts

that you have put forward and the quality control measures that you have

insisted we must obtain. I think that is reflected, too, in the price that we

get today.

Now it seems to be a situation - we see this in our

crab processing industry. I think it started off with a $1.30-something. Now I

am hearing rumours that it is up to close to $1.70 that some processors are

paying. I know the marketplace drives it, but I think quality has a lot to do

with it as well.

The seals - I thought the minister was going to

forget the seals there for awhile. He only included it in one of the last

paragraphs. I was shocked. I thought he had forgotten all about it.

MR. EFFORD: (Inaudible).

MR. FITZGERALD: I do not think we have given it

the attention, as a government, that we should have given it. I think there is

still a lot that needs to be done there, Minister. While you are right,

something has to be done with the herd, and I totally agree with you - whatever

the word is that we use to reduce the herd is not important, but something has

to be done - I think it is important that your government as well now put

particular emphasis on developing markets for the animal, especially the skins

and furs and this sort of thing.

The plant down in my district again, in Catalina -

the seal plant there which started up just the year before last - last year

bought in excess of 150,000 pelts, if I recall correctly. That is out of a total

of 275,000 that you were allowed to kill at that time. This year, in talking

with some people there, I understand they have only bought less than 50,000

pelts so far this year.

I am wondering what is happening there. It is

obviously a situation where either the markets have not been developed where

they have been able to sell their product - I understand they have a lot of

product there in inventory that has not been sold. It is something new and maybe

it is bad quality, as the minister says, but this is a new industry. This is

just as new as the fin fish industry, I say to the minister. It is just as new

as some of the aquaculture industries, but it seems like we are leaving this

particular industry to the private sector

whereas in other parts of the industry

we seem ready to jump in there and provide funding for it but we are not doing

it with the sealing industry. I think maybe that is something that needs to be

done and needs to be done soon.

The minister maybe should even look at having an

arm of his department look at trying to help the private sector along and

develop industries and pursue markets in order to make this a viable, acceptable

industry. I think it can provide many opportunities and I am sure that it will

allow our fishermen to be able to get back in their boats much quicker than any

of us can even hope for.

When we look at what is happening in the codfish

industry in the Province, and we look at the positive news on 3Ps and the

not-so-positive news that we hear from 2J+3Kl, I say to the minister - and I do

not know what influence you have up in Ottawa and I do not know if you are

consulted when it comes to setting quotas for the harvesting of cod - when you

hear people talking about the lack of codfish north of White Bay... Even back in

the 1980s there was very little codfish north of White Bay. When I talk about

the 800,000 pounds of fish that was processed at the FPI plant in one

twenty-four hour shift, the bulk of that fish, if you talk to the people on the

draggers and the people who were directly involved in the harvesting part of it,

they will tell you that most of that fish was caught in 3L or 3K. It certainly

did not come from 2J. We should not be alarmed about that.

I think Mr. Winters, a person in whom I have a lot

of faith, who has been doing some work for your department and for the union as

well, has put forward a suggestion that maybe we could realize 25,000 to 30,000

metric tonnes of cod fishery in area 2J+3Kl this year. The minister shakes his

head. I do not know if he shaking his head because he does not agree with the

numbers or if the numbers I am quoting are wrong.

Mr. Chairman, I think he also put forward a

suggestion that maybe the cod in 3Ps could support a catch of something like

70,000 metric tonnes, if I recall reading it correctly in the report that he

provided down in Clarenville to the FRCC.

The minister spoke about the Auditor General's

Report. I say to the minister: Do not get caught up in that. Do not get caught

up in the Auditor General's Report. While he may have some fear that we are

proceeding maybe a little bit too fast in the shellfish industry, something has

to be done in the meantime to sustain our communities. You might say that is

regressive thinking and we should take a lesson from what we have done and what

will happen to our cod fishery; but, I say to the minister, if you listen to the

real scientists out there, if you listen to the fishermen, they will tell you

what they are seeing and what they are finding.

When you look at the situation where we only

harvest the male crab and everything less than I think it is ninety-five

millimetres of body size is thrown back - we do not harvest any female crab - I

think the mesh size in the traps are large enough that most of the smaller crab

escape anyway. I think it is completely different than what we did with our

codfish industry where all we did was size the gear that we were fishing in

order to get more and more and make up for the smaller size fish that was there.

The minister talks about seaweed. He has been

talking about seaweed and underutilized species now for the three years that he

has been in the department. While it offers some opportunity, maybe a lot of

opportunity - and God knows we can use it in rural Newfoundland and Labrador -

it seems like people are hesitant to get involved. Here again, Minister, I think

something has to be done in order to help people along.

AN HON. MEMBER: Why?

MR. FITZGERALD: That is the question I ask you,

why? I don't know why but you obviously do know if you are promoting the

industry and if you are talking to the people out there. Maybe we need some help

to help them along.

When you look at some of the money that we have put

into the aquaculture industry, I don't know if we have ever made a dollar in the

aquaculture industry. I don't know - I ask the minister that - but when you look

at some of the money we have put into places like S.C.B. Fisheries and the

Belleoram Hatchery... When you look at the money that has gone into the

Belleoram Hatchery where, up until last year I think there was probably well in

excess of - to buy the plant there, the original cost was $500,000-and-something

and it ended up costing just about $1 million before it was even turned into a

hatchery. If I recall correctly, by looking at the Auditor General's Report, up

until last year there was only $5,000 worth of product sold there.

AN HON. MEMBER: Go away with you.

MR. FITZGERALD: Don't go away with me. They are

the Auditor General's figures, not mine, if you want to dispute them. If that is

true, then what is happening? Are we going after a dream that we would like to

see happen and not being realistic? Or, if there is potential there, then why

aren't we turning it into at least allowing those industries to be

self-sustaining and look after themselves?

While there are many opportunities there, there are

a lot of opportunities that are not going to be there for a lot of people. Your

district, Mr. Chairman, like mine, depends on the fishing industry; and if our

rural communities are going to survive then I do not think we should be one bit

shy in maintaining the quotas that we put have forward for the shellfish

industry and allowing at least that particular activity to happen while we are

waiting for other species to return, and allow fishermen and fish plant workers

to make a living in the processing sector.

These are my only remarks but maybe, if you do not

mind, I can ask a few questions. That way we can pass it on, or would you rather

for me to let the flow go?

CHAIR: I am easy; you can start now if you

want, if there is no problem with you. It is your (inaudible).

MR. FITZGERALD: Minister, maybe you might want

to respond to a couple of things that I raised.

MR. EFFORD: (Inaudible). Is the hon. member

saying that we should not put any money into research and development, and

whatever we did in the past will continue on in the future?

MR. FITZGERALD: (Inaudible).

MR. EFFORD: Because that scallop hatchery in

Belleoram is simply a research facility that was started and it was hoped that

it would go into production where a private industry would take it over. In

fact, as we are talking now today, there are discussions ongoing and will be

ongoing with an interest. At the time that is turned over, hopefully some time

in the future - but you have to invest in research and development. Otherwise

you will become stagnant, and when you become stagnant you start to fall behind

and nothing happens. I think, if you look back at our past, that is certainly a

history that we had up until a couple of decades ago.

The Auditor General's Report - I am glad that the

federal Auditor General pointed out exactly what he did; not saying that we have

cause for alarm or cause today that there is a major problem in the shellfish

industry, but we have to bring ourselves to attention every now and then because

when we only look at how much money we can make today in harvesting or

processing or in the industry, then that is a recipe for trouble in the future.

I said publicly that just the mere fact that the

Auditor General cautioned us, brought it to our attention, gives us a reason to

stop and think where we are going in the future. Yes, the shrimp stocks are

good, and yes, the crab stocks are good - today. Let's not only look at today,

let's look five to twenty years down the road. The fact is that he has brought

it to our attention. The fact is that I hope all of us will have the good common

sense to make sure that the measures we put in place and the quotas are based on

the best possible science information available.

I will give you an example of what I'm really

concerned about. Every boat involved in fishing in Newfoundland today wants to

derive a living from the shellfish industry. That to me is a recipe for trouble.

In Conception Bay this year there is a quota set, in the bay which I live, for

somewhere in excess of 3 million pounds. I am telling you now - and I hope I'm

proven wrong - that I do not think that crab is there, but if it is caught in

1999 it will not be there in the year 2000. That tells me there is trouble.

Those boats cannot go off fifty, sixty or seventy

miles. That is the reason why I have been fighting so hard to try to get the

darn seals reduced because if the seals are reduced the cod should have been

back. Seven years after the moratorium no one in the small boats are looking to

cod because they know the cod is not there, and they are going after the

shellfish. That is the reason. I am not saying that the shellfish is in trouble

today but I can tell you one thing: Don't ignore the warning that the Auditor

General is putting in place.

I will speak on crab licences very quickly. When I

became minister of the department, one of the major concerns around the Province

was the cartel. I do not think anyone in this Province is going to say there was

not a cartel. If they do, they are going to have one awful argument with me. You

know what was happening to the fishermen and everybody in the industry. There

were seven owners of seventeen licences. Today it is well distributed around the

Province, and the quota in 1995 was somewhere around 28,000 to 30,000 tonnes.

Today, it is 135 million pounds.

Are you saying that those seventeen licences should

have that total quota of 135 million pounds? I think not. I do not think Triton

is doing too bad, I do not think Bonavista is doing too bad. The three little

plants up the Southern Shore together - the three of them, Charlie O'Brien,

Martin O'Brien and Donnie Graham - together will not produce 5 million pounds

out of the 135 million pounds, but they will employ a few people.

I think it is well distributed and well placed

around the Province. So 135 million pounds of crab with the few licences out

there - and we have held the line. We are not increasing any more now. In fact,

four of the licences that were issued are not processing because of

circumstances beyond their control. In Burgeo, for example, there are no crab

there and they are looking for an offshore quota, and there are a couple of

other areas around the Province. You have to understand the reasons why we did

it: it was cartel controlled, and the amount of crab today compared to what it

was pre-1996.

AN HON. MEMBER: (Inaudible).

MR. EFFORD: Most of it was in the 3L, you are

right on that one.

The other one I want to make a quick comment about

is the developing market for seals. We are continuing. We have put money in the

seal market development for twelve years and we are still putting money in -

MR. FITZGERALD: Did you put money into looking

for markets -

MR. EFFORD: Yes, that is where it has gone.

MR. FITZGERALD: - or did you put money into

subsidizing the industry by paying fishermen to be able to go out and take an

animal and subsidize the cost of it? There is a big difference.

MR. EFFORD: Seventy-five per cent of the

funding went into market developing. Every pound of meat that came in is being

subsidized by the provincial and federal governments. We went around the world.

We have subsidized the people in the industry: the seal association, the seal

development board, going into markets. The one thing you have to recognize is

that unless we can do something with organizations like the IFAW there is not

going to be a major leap overnight in changing the attitudes of developing

markets. We are and we will continue to develop the seal markets.

You know and I know the present problem that we

have with the overpopulated seal herd is not going to be resolved by increasing

the market for seal products. That will gradually, over the next four or five

years, continue. All you have to do is look at a company like Corrino. How many

years?

AN HON. MEMBER: Thirty years.

MR. EFFORD: Thirty years they have been here. I

mean, they are developing. They are marketing their products worldwide and they

have a history in the Province. They did not have any problems last year with

the seal products they bought. The new company like you are talking about,

Atlantic Marine down in your area, was new in the industry. Some of the sealers

did not bring in too much of a quality product. They bought it and they have a

bit of a problem, but they have realized they have slow down like the company in

Baie Verte. They were very careful about the new company this year, about how

much they bought. I think they bought around 20,000 or 30,000. They want to make

sure what they buy they will process and be able to market a good product. I

think caution, concern, conservation are the things we have to look after for

the future.

The final comment I want to make here (inaudible)

600,000 pounds was processed in a twenty-four hour period, for example, in Port

Union. You are quite right, but remember where we had the days when all that

processing was taking place in every plant in the Province. If we had been a bit

more concerned about what was happening to the resource, probably Port Union may

not have been processing 600,000 pounds, but it could have been processing

200,000 pounds or 300,000 pounds for the long-term.

We made a lot of mistakes. The only thing I hope is

that we have the good common sense. Our shellfish is out there, the stocks are

good. Let's not repeat the mistake in the shellfish industry. When I see every

single boat in Newfoundland and Labrador today, and my own people, my own family

members, going after that shellfish, that gives me a lot of concern, Mr.

Chairman.

MR. FITZGERALD: As long as we do not become

paranoid over the whole thing, Minister, because when I -

MR. EFFORD: Liberals are never like that, sir.

MR. FITZGERALD: When I read the Auditor

General's report and he refers to the size of boats, it is totally unrelated. I

do not know why DFO is involved in boat size anyway. Why would the Auditor

General, or why would the Department of Fisheries and Oceans, be concerned about

the size of boat that my enterprise can sustain, if I am not looking for any

extra quota or any extra licence? Here again people have become paranoid that

they are going to come back looking for extra quota and extra licences in order

to maintain the size of boat they have.

The fishermen who I'm talking to are not looking

for that, and make it quite clear. When you see fishermen today having to go and

cut fourteen inches, or cut their boat in the middle to take two feet off it, in

order to be allowed to go fishing, there is something wrong, I say to you,

Minister. I do not know if you have brought that topic up with your federal

counterpart.

MR. EFFORD: (Inaudible).

MR. FITZGERALD: You certainly have not gotten

anywhere and the fishermen today are still facing the frustration.

MR. EFFORD: It is called micromanagement. It is

a problem that we have all had to deal with in the past, the present and the

future, in dealing with DFO. They believe the larger the boats the bigger the

demand on the resource. I disagree with it. I am on record writing several

letters to former ministers, the present minister, that we should not be

interfering with the size of boats. It should be based on safety and comfort.

Government, science, should set the quotas, and in particular today, with the

I.Q. fishery, the individual quotas, there is absolutely no reason for any level

of government to interfere.

MR. FITZGERALD: No reason.

MR. EFFORD: In fact, I even challenged the

federal minister, David Anderson, in a meeting in Ottawa last week - I do not

know Gerry if you were there; there was somebody with me - when I said: If you

think I'm wrong about the safety factor on the boats that have to go out on the

Grand Banks, come down with me. I do not have a lot of nerve for the ocean, but

I will go out. Let's spend a week out over the 200-mile limit in a sixty-four

foot boat. When we come back, you tell me if you would recommend not to build

larger boats. He would not accept that challenge.

You are right. We should not, as governments, be

interfering. It is a safety issue. I'm telling you, I'm fearful that it is a

tragedy waiting to happen. I think we talked about that, Mr. Chairman, over

supper this evening.

MR. FITZGERALD: It has already happened, I say

to the minister.

WITNESS: (Inaudible) supper.

MR. EFFORD: Yes, with the Liberals.

MR. FITZGERALD: It is something that needs to

be looked at.

Down in Belleoram again, with the hatchery there,

you say that is going to be passed over to private industry, or there is

somebody -

MR. EFFORD: That is the long-term plan.

MR. FITZGERALD: Because in the fisheries report

or in the Auditor General's report, she had indicated that your department had

made a statement, or had indicated that it would disperse the operation as of

March 1999. March is here and gone and we still have it. I am wondering if there

is a new owner or if we have somebody who might potentially want to take that

over.

MR. EFFORD: (Inaudible) as of March 1999? The

plan was this. From day one it was a research and development facility, and once

it got up to commercial value it would be turned over to private enterprise. I

was not sure that the date was set for March 1999.

MR. FITZGERALD: March 1998.

MR. EFFORD: March 1998?

MR. FITZGERALD: March 1999. Hang on a second

now.

MR. EFFORD: We are now having discussions with

an interested party. When the appropriate time comes - I tell you, we are not

going to just jump out and throw it in the wind. We want to make sure that

whatever company takes that over it will be a viable company and the operation

will be viable for the long-term.

MR. FITZGERALD: March 1999 -

MR. EFFORD: Yes, 1999.

MR. FITZGERALD: - you indicated you were going

to be passing it on to a private company and get out of the industry.

MR. EFFORD: I invited the Auditor General -

MR. FITZGERALD: Research and development are

two good catchy words, Minister, but there comes a time the taxpayers of this

Province are going to want to know where the end results are going to be.

Research and development can only go on so long.

MR. WARD: The issue on Belleoram, specifically,

was for a three year project, of course. The first two years had some very poor

results. It is no question they were the result of very poor water conditions

and so on down there. Last year was the first year in which we were successful

in bringing it from the larval stage all the way up to the point of putting it

in the ocean. This year we will have roughly 5 million spat which they can put

out into the ocean which will be sold at, we hope, between three and three and a

half cents. The cost of operating, as you indicated there, is up in the area of

$200,000. We need another good year to see whether, from a research and

development perspective, you can actually take scallops into an aquaculture

position and have success.

The first two years were a disaster. Last year was

very encouraging. The objective this year is to put out maybe 8 million to 10

million spat. We are seriously looking at ways of divesting this before the end

of this coming fiscal year.

MR. EFFORD: I would make one final comment. If

we did not put money into research and development we would still be back

spreading fish on the beaches.

MR. FITZGERALD: I am not arguing with that.

What I am saying is that there comes a time when research and development should

give way to a company making a profit, or else your research and development

should be able to tell you something. It is not feasible anymore.

Going back to those small grants that used to be

provided, and I think still are in certain cases within your department -

MR. EFFORD: What grants?

MR. FITZGERALD: Three thousand dollars that a

fishermen's committee could access to do a slipway or to do some repairs to

their wharfs. It was money that was well spent in most areas. It would encourage

people to show a little bit of initiative to provide the labour themselves. It

was only meant for material and not labour.

MR. EFFORD: That is right.

MR. FITZGERALD: How much money do you have in

that budget?

MR. EFFORD: Two hundred and fifty thousand

dollars or two hundred and seventy-five thousand dollars?

WITNESS: Two hundred and fifty thousand dollars

this year.

MR. EFFORD: Two hundred and fifty thousand

dollars.

MR. FITZGERALD: Two hundred and fifty thousand

dollars? It is only a matter of making application, I guess, and -

MR. EFFORD: I would not say that.

MR. FITZGERALD: - it should be brought forward.

MR. EFFORD: I would not go as far as to say

that.

CHAIR: Are you finished?

MR. FITZGERALD: For now, yes.

CHAIR: We do not have to go in any particular

order, but do you want to ask a few questions down there, Mr. Collins?

AN HON. MEMBER: (Inaudible).

CHAIR: Who else is ready to go? Mr. Hunter?

MR. HUNTER: (Inaudible) like to ask (inaudible)

a couple of questions.

Mr. Minister, I am not too familiar with fishing

and the sea, because I am an inland person, but from going around the district

I've noticed in the Green Bay south area that there are a lot of mussel farms

and harvesting in that area. From some conversations with people and fisherman

out there, a lot of the mussels are being dumped because of the size in that

area, and a lot of the problem stems from lack of processing facilities. I do

not think there is a processing plant in Green Bay south for mussels. If there

is not, would you support the idea of initiating some type of secondary

processing in the Green Bay south area so that fishermen could bring their

product to that market quicker and so that these mussels would not be dumped

anymore in the future? Would you support an idea like that?

MR. EFFORD: I'm going to let my Assistant

Deputy Minister answer the question. I want to make a couple of comments prior

to that.

First of all, there is absolutely no reason for

anybody to dump mussels. Can you imagine that we are growing mussels in 1999 and

we are dumping mussels? First of all, we made a number of exceptions last year

to the rule of allowing people who had a problem with selling their mussels to

ship them out of the Province unprocessed into P.E.I. or wherever they could

find markets. We made all kinds of exceptions. There is a number of processing

facilities in the Province today. In fact, there is a value added secondary

processing over in New Harbour. There is one out in Bay Roberts.

The problem that we have had is trying to bring the

people in the industry together and to make sure they can get their mussels to

market. In fact, there was a consortium formed last year. There was seventeen

processors, a lot them from your area involved in that consortium. For some

reason there are individuals who resist moving forward for their own particular

reasons. I think most recently we have had another aquaculture meeting out in

Gander and things are moving forward. I do not see that problem in the future.

I'm going to tell you one thing, and I will say this unequivocally, that any

farmer growing mussels in Newfoundland and Labrador to say that he or she dumped

their mussels should be ashamed.

MR. HUNTER: Would you support the idea of

processing and secondary processing in Green Bay south?

MR. EFFORD: We will not support having every

farmer in Newfoundland and Labrador with a processing license. We are concerned

about -

MR. HUNTER: I never asked you that question,

Mr. Minister. I asked you the question: Would you support the idea of having a

secondary processing plant in Green Bay south area?

MR. EFFORD: It is not an issue with secondary

processing. Secondary? Yes!

MR. HUNTER: Or a processing plant plus a

secondary processing plant?

MR. EFFORD: Gerry.

MR. WARD: There a number of issues here. Number

one, we have come from 360 tonnes to 950 tonnes of mussel in total for

Newfoundland. That is not enough to keep one small plant going on a year-round

basis. The reality is that we have five primary processing plants today and we

have two secondary processing plants. By the end of this year, now, we need

about three times the amount of production to just keep these plants busy on an

eight-hour shift.

The issue on small mussels is clearly a marketing

issue. The analogy can be made very similar to the cod fishery in the Isle aux

Morts and Port aux Basques area. You bring in a fish, it is very small, you can

produce less than a two-ounce fillet on it. What do you do with it? You put it

into a cod block and downgrade the market.

It is the same situation with mussels. The market

in the United States calls particularly for 2.25 to 2.75 shell size. If you do

not have that size, you either take a lower price or you have to decide to shuck

it out and put it into meats and put it into a value added product. That is now

being done, since last fall.

There were two requests that came in to the

minister to allow them to ship product for processing outside of the Province.

The department said: You have to prove it cannot be processed. Today, as a

result, we do not have enough product to sell today. We do have the five primary

processors and two secondary processors. With regards to Green Bay, there is a

plant right down in your neck of the woods, Ed Sheppard specifically, and Island

Treasures Mussel Processing Ltd.

MR. HUNTER: I think the mussels they were

talking about were the oversized ones. They would not accept them out there.

They had no choice other than to dump them.

MR. WARD: Those are getting through the system.

I think that is more a function of a new fishery. Until you can match up the

production with the market, you either have some small products and you have

some large products. Part of it had to do with they were not using grading

equipment to grade them properly, so therefore you had all ranges of shells when

you went to market. By the time this year is out that will be through the system

and new crops starting in 2000 will be within the range that you require to

market. Those that are not will clearly go into secondary processing, shell on,

meats, solids and so on. We have two very good secondary processors doing just

that today.

MR. HUNTER: Will you at least talk to some of

the fisherman in that area and see what their concerns on that are?

MR. WARD: I am glad you mentioned that. I just

came back from a week on the road. I went down to visit the major players

personally with my directors and a couple of others on Thursday and Friday of

last week. They clearly today do not have a problem with selling their product.

Not today. I do not foresee that in the immediate future.

MR. HUNTER: I just relayed what they told me

about three weeks ago when I was out there.

There is another question I would like to ask the

minister too if I can, Mr. Chairman. It regards the fish plant in Triton. It has

beautiful facilities out there. The license was awarded to FPI there probably a

couple of years. Now they are running into problems. The water line to the plant

is not big enough. There is a big panic now that the plant could have to cut

back and possibly close, down the road. I am wondering if the minister had

anybody to check into that problem and see if there is anything that can be done

this spring?

MR. EFFORD: First of all, that is a municipal

infrastructure problem. The Department of Fisheries and Aquaculture is not in

the position to get involved in providing water lines to any processing, whether

it is primary or secondary or whatever.

Our policy is quite clear. We will not put any

money whatsoever into the primary processing facilities in the Province. It is

all made by private investments. In the meantime, the proponents, the owners of

the FPI organization, myself, ourselves, have had discussions and will continue

discussions with the Minister of Municipal and Provincial Affairs. I can't make

a commitment this evening, but I feel confident that is going to be addressed.

Because it is not only in Triton, it is in a number of other areas around

Newfoundland where there are a number of fish plants, due to the municipal

infrastructure, that can't get the necessary water supply. Particularly in

shrimp, where they require an excessive usage of water. That is a municipal

thing. It is a problem that has to be addressed and I feel confident it will be.

MR. HUNTER: Also in Triton too, Mr. Minister, I

don't know what input your department would have into it, but I believe Triton

is one of the few communities in Newfoundland, at that size, that does not have

a public wharf there. I think they have been lobbying to get some support for a

wharf for Triton. I wonder if your department is aware of that, and if they are,

if there is anything you could do to assist the fishermen's committee out there.

MR. EFFORD: On February 9 they placed an awful

lot of confidence in yourself when they voted for you, that you could make all

the representation possible to the federal government. It is not a provincial

issue. It is a federal issue, and they placed an awful lot of confidence in you.

MR. HUNTER: That says something, doesn't it?

MR. EFFORD: That says something, so you have no

problems getting that money for the wharf.

MR. HUNTER: Thanks for the compliment, sir.

Thank you very much.

CHAIR: Is that it?

MR. HUNTER: That's it for now.

CHAIR: Mr. Rideout?

Back to you, Mr. Fitzgerald.

MR. FITZGERALD: Thank you, Mr. Chairman.

Minister, maybe we can look at some of the

appropriations in the budget there. When I look at the budgets it always amazes

me when I see the figures that are put under Transportation and Communications.

It almost seems like that is a heading where, if you have some expenditures that

you do not want to show anywhere, you push it under - not you, I say to the

minister, but all departments - Transportation and Communications. In fact your

budget, if you look at it, your department has budgeted $1,025,700 for

Transportation and Communications. Maybe you would like to be able to just

enlighten us as to what is involved in Transportation and Communications. I

suppose there is travel for you and for your staff, but what is Communications?

Phone bills, fax bills? It is a tremendous amount of money.

MR. EFFORD: First of all, one of the things you

could criticize the department for - and you raised it earlier when you said

opening up new markets for the sealing industry. If you are going to open up new

markets then there has to be travel to visit, to negotiate, and to have meetings

in market development. You are not going to do that sitting in your office in

St. John's when there is a reason to go down to the Boston Seafood Show or

reason to go to some other part of the world. As minister I have travelled

extensively visiting markets. As much as I hate to fly and dislike flying, I

have to do it. It is my responsibility. Other people in the department must

travel and must be part of promoting the seafood products.

If you look at the amount of money that was spent

in the Department of Fisheries and Aquaculture in 1999, and you look at a $700

million export value, with not one nickel outside of that market development of

the taxpayers' dollars going into it, I think it is a very profitable industry.

That travel - I visited China, visited Japan twice, visited Iceland, visited

Norway, visited London, visited the Boston Seafood Show and visited a number of

other markets - paid off well.

What does it take in? It takes in communication

services, the fax machines, the telephone calls and everything else that goes on

in the day to day operations for 365 days a year, plus the five regional offices

around the Province. What is the staff in the Department of Fisheries and

Aquaculture? Less than one hundred?

WITNESS: About one hundred.

MR. EFFORD: About one hundred. The energy and

the productivity of one hundred people involved in fisheries development,

fisheries marketing, fisheries research and fisheries productivity with a $700

million export - our budget today, maximum, includes federal cost-shared.

Provincial money is $13 million. When your colleague there was minister - and I

suspect he could tell you the exact number - it was probably around $35 million

or $38 million.

The energy that is coming from this department

today was never equalled in the history of the Province.

MR. FITZGERALD: Who paid your ADM's wages and

travel allowance while he was looking after the hatchery down in Bay d'Espoir?

Did the taxpayers of the Province pay that bill, or was it paid from the income

from S.C.B. Fisheries?

MR. EFFORD: Well, first of all, the taxpayers

of the Province paid for the $6.4 million that was put into the aquaculture

industry to sustain it in Bay d'Espoir. The salary of the ADM was paid for by

the Department of Fisheries and Aquaculture. If the aquaculture industry in Bay

d'Espoir had been making money, it would not have required the $6.4 million, so

therefore it was the responsibility of our department to pay the wages of Mr.

Ward while he was down there.

MR. FITZGERALD: So the $6.4 million was a loan

guarantee, I understand, was it?

MR. EFFORD: I am sorry?

MR. FITZGERALD: It was a loan guarantee?

MR. EFFORD: The $6.4 million?

MR. FITZGERALD: Yes.

MR. EFFORD: Yes.

MR. FITZGERALD: It was a loan guarantee?

MR. EFFORD: Yes, I answered that today.

MR. FITZGERALD: So the payment for the wages

and the cost of having the ADM down at Bay d'Espoir was in addition to that and

that came out of your department?

MR. EFFORD: Yes, and he was not down there. He

was still performing his duties, working seven days a week in most instances, as

an ADM.

MR. FITZGERALD: I am not questioning that.

MR. EFFORD: He was part-time in Bay d'Espoir

and it was out of his normal salary from the Department of Fisheries and

Aquaculture.

MR. FITZGERALD: How many marine facilities does

your department own in the Province now?

MR. EFFORD: Today? Not very many.

WITNESS: One hundred and twenty.

MR. EFFORD: We still own them?

WITNESS: (Inaudible). We had 320. We have

around 200 sold.

MR. EFFORD: Yes. There were 320 and we have 200

diversified - gotten rid of.

MR. FITZGERALD: I do not understand that.

MR. EFFORD: We have 120 left. You are talking

about the marine service centres.

MR. FITZGERALD: I am talking about the marine

service centres.

MR. EFFORD: You are not talking about the

(inaudible). That is what I was talking about.

MR. FITZGERALD: So, you are talking about the

wharfs, and the slipways and -

MR. EFFORD: Yes, we do not have that many -

WITNESS: (Inaudible).

MR. EFFORD: The marine service centres? We do

not have very many.

WITNESS: (Inaudible).

MR. EFFORD: Yes, Bonavista is sold, Burgeo is

sold, Durrell is sold. There are twenty-three in total, eight sold, six pending

and three ongoing.

MR. FITZGERALD: So, you own nine?

MR. EFFORD: Well, there are eight sold, six

pending, three ongoing, and six no action. We still have six more to go; there

is no action.

MR. FITZGERALD: I wondered because, when you

look at appropriation here, heading 2.1.01, you look at the "...administration

of the Department's regional structure including the maintenance and repair of

all Government-owned marine facilities in the Province." When you look at that

you are not talking, Minister, about going to the Boston Seafood Show or

travelling over to China or Japan. You are talking about inter-Province travel.

MR. EFFORD: Yes.

MR. FITZGERALD: When you see Transportation and

Communications, $303,600, to me it sounds like a lot of money.

MR. EFFORD: Well, let me go back now. You see,

what I am trying to do as the minister is clean up some of the mess that was

created by the former government.

MR. FITZGERALD: Ten years and you still do not

have it cleaned up?

MR. EFFORD: Remember, they built all of the

marine centres.

MR. FITZGERALD: You do not have a very

efficient department if you do not have it cleaned up after ten years.

MR. EFFORD: Yes, brother, I have something to

clean up. They built all of the marine centres.

MR. FITZGERALD: (Inaudible) former minister.

MR. EFFORD: We are now diversifying; we are now

privatizing. We are now putting them where they should have been in day one, so

that is being done. Most of the money that you just referred to is incurred by

the quality initiatives program that we put forth. We have inspectors going all

around the Province checking all the boats, checking all the fish plants -

WITNESS: Thirty of them.

MR. EFFORD: Thirty of them - doing a darn good

quality assurance program that was never ever before implemented in this

Province.

MR. FITZGERALD: Wouldn't that be come under

processing?

MR. EFFORD: When you go down to the marketplace

now and talk to someone like Red Lobster, or some company in the United States,

and you see that the quality of Newfoundland sea products is second to none in

the world, then that little bit of travel is well worth it in a $700 million

export value.

MR. FITZGERALD: But, Minister, you are not

giving me the right information. If you look at heading 2.3.01, it would include

again all those things that you just suggested. It would include licensing,

inspection, provision of technical and financial services, and for that,

Minister, we see another $152,900. So it has nothing to do with inspections and

licensing and quality control.

MR. EFFORD: So where is the money supposed to

come from to pay -

MR. FITZGERALD: I am asking. I do not know

where it is -

MR. EFFORD: Let me answer the question. You

have to pay regional staff, and you have to pay your headquarters staff. The

administration of the Department of Fisheries has to be paid for, and the travel

that is incurred around the Province by the regional staff and by the thirty

inspectors that is going around. The total budget of the Department of Fisheries

and Aquaculture, including the federal cost-shared programs today, in 1999, is

$13.5 million compared to $35 million or $38 million a decade ago.

MR. FITZGERALD: It still seems like an awful

lot of money.

MR. EFFORD: Thirteen million compared to $38

million is a lot of money? What would you have said if you had been sitting in

my shoes in 1985?

MR. FITZGERALD: It seems like an awful lot of

money when you are saying that you are spending one-third of a million dollars

for travel, looking after your marine centres around Newfoundland and Labrador.

MR. EFFORD: That is not correct.

MR. FITZGERALD: Well, that was the statement

that you gave me.

MR. EFFORD: I did not say that. I said,

inspectors going around at the quality assurance program.

MR. FITZGERALD: The inspectors are another

$152,900. Alright, if you want to use that, we will lump the two of them

together and we will call it half a million dollars.

MR. EFFORD: Sorry?

MR. FITZGERALD: If you want to do it that way,

then we will lump the two of them together and we will say half a million

dollars.

MR. EFFORD: Yes, and what is the point you are

trying to make?

MR. FITZGERALD: The point I am trying to make

is that is sounds like a lot of money for transportation and communications

around the Province.

You have representatives. Out in Bonavista for

instance, you have a representative that looks after the area there. So you are

not sending somebody from St. John's on a daily basis out to look after your

interests in those areas. I would assume they are in other places around the

Province.

MR. EFFORD: We have five regional offices

around the Province. Each one of those five regional offices are staffed. There

are not many into them; what, three or four in each one?

WITNESS: On average about five.

MR. EFFORD: On average about five.

On top of that, you have thirty inspectors that in

the fishing season are travelling all over the Province, wherever the boats are

docking, checking whether it is crab, or whether it is shrimp, or whether it is

caplin or whatever. That is costly when you have people travelling around the

Province checking every dock where there are boats off-loading.

Apart from that, during the off season from the

fishing season they are then employed in the regional offices doing inspections

into and working with the Fisheries Loan Board and with the marine service

centres. If you look at the five regional offices, and you look at the

administration responsible for that activity around the Province, what is

$500,000 or $600,000 for twelve months compared to a decade ago when it was

costing $4 million or $5 million? I think we are doing a darn good job.

MR. FITZGERALD: Property, Furnishings and

Equipment -

MR. EFFORD: New chesterfield in my office.

WITNESS: What colour?

MR. EFFORD: Black.

MR. FITZGERALD: - is another one where there is

a fair amount of money spent, Minister, $1,025,700. What is included in

Property, Furnishing, and Equipment? I know it is not your office furniture.

What is included in it?

MR. EFFORD: One million? I have to check on

that one.

MR. FITZGERALD: You can; $1,025,700.

MR. EFFORD: What subhead are you reading?

MR. FITZGERALD: That is the total of your

subheads under properties and furnishing.

MR. EFFORD: Where are you reading it from?

MR. FITZGERALD: I added up the Property,

Furnishing and Equipment for your department. You can pick them out and go

through them, if you want, under each heading.

MR. EFFORD: You totalled it up?

MR. FITZGERALD: The total is $1,025,700.

MR. EFFORD: I can tell you one thing, it was

not spent on furniture. You had better check it again.

MR. FITZGERALD: No, that is correct, Minister.

MR. EFFORD: You tell me the page it is on.

MR. FITZGERALD: All you do is look at the

headings. You look at your property and furnishings under each heading and total

them up and that is your departmental costs for Property, Furnishing and

Equipment for the year.

MR. EFFORD: I am going to tell you, you have to

go back to school.

MR. FITZGERALD: Add them up and see what you

get.

MR. EFFORD: I am adding them up. No, it is not

there.

MR. FITZGERALD: Yes, it is there.

MR. EFFORD: Not even close. He cannot add and

subtract.

MR. FITZGERALD: Add them up and see.

MR. EFFORD: Anyhow, the Property, Furnishings

and Equipment in offices could be computers -

MR. FITZGERALD: The one there under

Administration and Support Services, for instance, $121,900.

MR. EFFORD: The largest one. That is for

computers and whatever equipment is needed for the office staff.

I can tell one thing, there is no computer in my

office. I do not even know how to turn it on.

MR. FITZGERALD: You have a buddy here.

MR. WARD: The total I get is roughly $240,000.

MR. EFFORD: My ADM tells me the total he gets

is about $240,000.

MR. FITZGERALD: (Inaudible).

MR. EFFORD: About $240,000. You have to go back

to school.

MR. FITZGERALD: Under 2.1.02., Labrador Fish

Plants -

MR. EFFORD: Kelvin, do you have a pocket

calculator?

MR. FITZGERALD: Tell him to total up

Transportation and Communications, while he is at it, and see what he gets.

MR. EFFORD: You made a mistake, seriously -

about $250,000.

MR. FITZGERALD: Look at 2.1.02.

MR. EFFORD: 2.1.02.

MR. FITZGERALD: We can back up one, 2.1.01.,

Property, Furnishings and Equipment, under Administration and Support Services,

$13,600 budgeted and revised to $94,400.

MR. EFFORD: That was the purchase of vehicles

for the department. We had vehicles out there that staff were using - one on the

West Coast, I think, had over 400,000 kilometres on it. It was just stopped by

inspection and ordered off the road. We just could not continue, so we had to

buy some vehicles.

MR. FITZGERALD: Under 2.1.02, Labrador Fish

Plants.

MR. EFFORD: That is subsidy to Torngat

Fisheries to Makkovik and Nain.

MR. FITZGERALD: Is that depleting itself as

time goes by?

MR. EFFORD: Our intention is to deplete that

down to zero dollars when the plant has enough productivity to do that. We had

hoped that when Voisey's Bay had gotten on the go, there would not have been so

much pressure on seeking employment into the Nain fish plant. With the situation

with Voisey's Bay, the people in Nain need work and naturally the fish plant is

the only -

MR. FITZGERALD: (Inaudible).

MR. EFFORD: There is more pressure applied so

we have maintained the subsidy this year at $200,000 but we have reduced that

from $800,000 annually subsidy down to $200,000. Our intention is, when possible

- I am not going to say next year because circumstances may not allow it. If you

are living in Hopedale, Nain or Makkovik, and there is no other opportunity of

employment, I do not think anybody can argue that is not money well invested.

MR. FITZGERALD: I think it was something like

$400,000 back in the 1997 Budget, $300,000 this year, and next year $200,000.

MR. EFFORD: If circumstances allow, it will be

scaled down to zero dollars.

MR. FITZGERALD: The other one that jumps out at

me here is Purchased Services, under 2.1.03., where there was $90,000 budgeted,

$10,000 spent, and this year there is another $90,000 back there.

MR. EFFORD: Is that my travel? That could be my

travel.

WITNESS: (Inaudible).

MR. EFFORD: Oh, yes.

One example there is down in the Nain fish plant.

We had to make some improvements to the fish plant because of the location of

the electrical room and furnace. It was right inside in the fish plant and had

to be moved out. There was a small piece built on that fish plant. It is capital

works in a number of areas, but that is one of areas that took up most of that

money.

MR. FITZGERALD:

Section 2.2.02., Middle

Distance Fishing Vessel. Do we have any middle distance fishing vessels now?

MR. EFFORD: Ask your buddy.

MR. FITZGERALD: I am asking you.

WITNESS: You are the minister. Do we have any

is the question?

MR. EFFORD: No, they are all gone.

WITNESS: Right, exactly, so answer it.

MR. EFFORD: It took me all these years to get

rid of the mess.

MR. FITZGERALD: What did you do with the

Nain Banker ? Where did it go?

MR. EFFORD: Labrador Shrimp Company.

MR. FITZGERALD: So that was given to them at

the time?

MR. EFFORD: I wish I had three or four of them

here now.

MR. FITZGERALD: Are they using it actively?

MR. EFFORD: Yes, Sir, creating a big demand.

If I had that $40 million that was wasted, I would

have ten or fifteen of them on the go now.

MR. FITZGERALD: There was no money put forward

for Purchased Services in 1997, and there is nothing showing in 1998-1999 under

Middle Distance Fishing Fleet. If we have passed this over to the fish plant

down there, are we still responsible for the cost of it?

MR. EFFORD: I am sorry, what was that again?

MR. FITZGERALD: There were no appropriations

provided for Purchased Services back in 1997, and there was nothing in 1998.

This year I notice you have the Estimates put forward where there is another

$100,000 there.

MR. EFFORD: For what?

MR. FITZGERALD: For the Middle Distance Fleet,

Purchased Services.

WITNESS: That is just contingencies

(inaudible).

MR. EFFORD: That was contingencies there just

in case it was needed. The deal was clued up a couple of weeks ago.

WITNESS: A week ago.

MR. EFFORD: A week ago, on the Nain Banker ,

and that will not now be drawn down because it is now in the hands of a private

company. Actually, I would think, as we are talking tonight it is probably out

hauling nets.

MR. FITZGERALD: It is probably what?

MR. EFFORD: Fishing.

We are not responsible for anything.

MR. FITZGERALD: Why would we put $100,000 there

for Purchased Services for a vessel that we do not own?

MR. EFFORD: Because that was before - the deal

was only done a week, a week and a half, or two weeks ago.

Now, I can use that for travel.

MR. FITZGERALD: Purchased Services, under

2.3.01.06, $119,200 in the Budget, $186,700 in the revision, and up to $221,700,

an extra $100,000. What is that for? Is that (inaudible) purchase?

MR. EFFORD: Most of that went into the

(inaudible). I must say -

MR. FITZGERALD: Went into what?

MR. EFFORD: There are not enough words to

describe the excellent presence that we made this year at the Boston Seafood

Show. Three years ago, previous to my becoming minister, we stopped having a

reception at the Boston Seafood Show. I reinstated that. We reorganized the

booth display down there and put a number of banners around our program at our

reception promoting quality. I can tell you, the few dollars you just mentioned

were well invested. The staff of the Department of Fisheries and Aquaculture was

noted this year - Newfoundland and Labrador was noted this year as having the

most viable presence at the Boston Seafood Show. That says something, for it is

the largest seafood show in the world.

MR. FITZGERALD: Minister, the $1,459,700, I'm

sorry, I said to you it was Property, Furnishings and Equipment. It was

Purchased Services. That was the heading I had totalled up.

MR. EFFORD: Yes.

MR. FITZGERALD: Page 120, 3.2.01, under

Purchased Services there again, there was $390,500. Then it was revised to

$150,000 and this year it is back up again to $264,000 for the Newfoundland

Economic Renewal Agreement, 80 per cent cost-shared by the federal government.

Why the big difference there?

MR. EFFORD: That is on the ACERA agreement. Is

that right?

WITNESS: Yes.

MR. EFFORD: Do you want to deal with that? That

is on the federal-provincial aquaculture agreement.

MR. WARD: Most of those relate to services for

consultants and our contractors under the cost-shared agreement, of course,

federally and provincially.

MR. FITZGERALD: For the what?

MR. WARD: Consultants' fees, contractors' fees,

for a number of projects that are ongoing and so on.

MR. FITZGERALD: When you follow down there to

01, Revenue-Federal, I look at that and the way I read it - I'm sure I must be

reading it wrong - when you look at the budget there, $4,649,000 and you look at

the revision of $1,783,300, and even on forward to the estimates, there is still

in excess of $1 million there. Does that mean we are not spending the amount of

federal money we are taking in under that particular heading?

MR. EFFORD: That is a three year agreement. So

I mean you don't spend it all -

MR. FITZGERALD: So this is the amount we are

spending this year?

MR. EFFORD: Yes, you do not spend it all in the

one year.

MR. FITZGERALD: No, I did not know it was a

three year agreement.

WITNESS: Five years.

MR. EFFORD: For five years, I'm sorry.

MR. FITZGERALD: It is a five year agreement.

MR. EFFORD: A five year agreement, yes.

MR. FITZGERALD: Okay. So that will be spread

over the five years. This money that we have spent here is up until now, or is

this an agreement that has been entered into this year?

MR. WARD: (Inaudible) four years ago.

MR. EFFORD: That started four - yes, go ahead.

MR. WARD: The aquaculture agreement is the

aquaculture component of the Economic Renewal Agreement. We are actually

entering the fourth year of that agreement, and it extends out until March 31,

2001, a five year program. In total, there is $20 million over five years,

cost-shared, federal-provincial.

MR. FITZGERALD: So next year we should be

showing approximately $1,500,000-something there which we will use up, the

remainder of that agreement?

MR. WARD: That is correct.

MR. FITZGERALD: Would that be the same thing

for the Economic Renewal Agreement on 3.2.02, where here again we see

Revenue-Federal $2,720,000? It is still a sizable amount of money there again

that is not spent. This is another federal-provincial agreement over what, a

five or three year period?

MR. WARD: It is the same agreement over a five

year period. Capital.

MR. EFFORD: It is the same agreement, capital

expenditure.

MR. FITZGERALD: It is the same agreement.

MR. EFFORD: One is current, one is capital.

MR. FITZGERALD: Okay. I am just as confused as

ever after that.

Assistant Deputy Minister, are there any mussel

farms in this Province today that are turning a profit?

MR. WARD: We certainly do not have their

financial statements but there are quite a number of mussel farms. They are all

private. What has been happening is they have to get their production up to a

level that makes them economically viable.

If you look at it in total, there are a little over

one hundred licenses out there. About twenty of them are very serious farmers

and they are employed full-time in that industry. So yes, there are a number of

mussel farmers who are making money. If you look at the opportunities within the

Province, unquestionably mussels would be one that you would have to rank -

MR. EFFORD: The most confidence.

MR WARD: - as one with the most confidence

within the industry. Especially with the aquaculture working capital fund that

has set up for $5 million specifically to deal with shellfish and mussels to be

at least 80 per cent of that.

MR. EFFORD: That is not a grant, that is a

loan. Each independent farm which comes and applies for that money must come in

with an appropriate business plan. It will be based on the economics of that

business plan if they will get a loan. Each farm that is out there is privately

owned. Whether they are making one dollar or $500 or $5,000, that is private

industry. That is not government controlled.

MR. FITZGERALD: It is nice to know how the

industry is going. That is the reason for the question.

MR. EFFORD: Gerry just explained. In three or

four years down the road I can see the majority of those mussel farmers, whoever

is there now, will be in a very substantial position in the future of making a

good living. I mean, the opportunity is there, the climate conditions and the

environmental conditions are right, the market conditions are right. Now they

have a $5 million loan program they can avail of to expand their operations. So

yes, the future is very good. They were restricted because they went to the

banks and the banks would not talk to them. Now this $5 million -

MR. FITZGERALD: It is a long-term -

MR. EFFORD: Yes, now this $5 million loan

program is going to allow them to expand their operations. I can see four years,

Gerry, five years?

MR. WARD: If you look at the mussel industry,

in a three year period we have come from 362 metric tonnes to 650 metric tonnes

to 947 metric tonnes, and we will do 2,000 metric tonnes this year. Any time you

can do 50 per cent and 100 per cent increase in your production, it may not

sound like much in comparison to P.E.I. but they started low as well. If you get

four or five years of 50 per cent and doubling your production, you will be up

to 5,000 tonnes-plus within a three to four year period. That is really what we

are talking about with the shellfish working capital fund.

MR. FITZGERALD: It is an excellent product. I

guess most of what we buy here locally is from local farms I would assume, or I

would hope. Down where I live there is an excellent area for wild mussels. We

get them much bigger down there. I see those small mussel in the store and I

pass them by but recently I have been buying them and they are excellent. There

is no reason why it would not be successful and create some opportunities. Would

mussel processors and sea urchin processors be the same people?

MR. EFFORD: I'm sorry, what was that?

MR. FITZGERALD: Would mussel processors and sea

urchin processors be the same people?

MR. EFFORD: No.

MR. FITZGERALD: Not necessarily. How many sea

urchin processors do we have?

MR. EFFORD: Maybe one or two. Sea urchins?

There are five sea urchin processors in the Province. It is not impossible for

them to be the same one. The one on Bell Island is doing sea urchins. I'm not

saying they could not do mussels but they have not been in the mussel industry.

There is -

WITNESS: (Inaudible).

MR. EFFORD: Pardon? Portugal Cove is doing sea

urchins and they are also doing mussels. Jim Parsons. So they certainly can. I

mean, somebody doing primary processing of mussels can also do primary

processing of sea urchins. It is the same as you can do cod, you can do

flounder, you can do turbot. You are not restricted to one species. That is the

opportunity. If they have the licences it is up to the individual who wants to

take advantage of the markets.

MR. FITZGERALD: Yes, but right now they are

not.

MR. EFFORD: Portugal Cove is one example that

is doing both.

MR. FITZGERALD: Just one.

MR. EFFORD: I think there is one other one.

MR. FITZGERALD: When do you expect to hear the

announcement on the quota that is being brought forward in 3Ps and 2J+3KL for

cod fishery?

MR. EFFORD: On May 6.

MR. FITZGERALD: That is when it is going to be

brought forwarded. Any idea what the quotas might be?

MR. EFFORD: I would not be a bit surprised if

it is not increased to somewhere between 25,000 tonnes to 30,000 tonnes total.

MR. FITZGERALD: In 3Ps?

MR. EFFORD: In 3Ps.

MR. FITZGERALD: What are we looking at in

2J+3KL?

MR. EFFORD: There is not going to be an

announcement on May 6 on that one. It is going to probably be a week or two

later because they want to an assessment of the two different scientific views

that have been put forward. I would say it would be two weeks later?

WITNESS: May 17 or May 18.

MR. EFFORD: May 17 or May 18.

MR. FITZGERALD: There is no indication of what

they are looking at?

MR. EFFORD: No, no indication. I would be very

surprised, Roger, if they are going to get what they are asking for, 35,000

tonnes. I think the fishermen will be happy if they get a reasonable increase.

MR. FITZGERALD: Yes. I think if you could see

15,000 tonnes or 20,000 tonnes.

MR. EFFORD: If they could go up to -

MR. FITZGERALD: If you saw 15,000 metric tonnes

there, it may not make them happy but it would satisfy them.

MR. EFFORD: Last year the fishermen in that

area averaged 2,700 pounds per boat.

MR. FITZGERALD: Four thousand metric tonnes,

2,700 pounds each.

MR. EFFORD: If they went up, say, to 10,000

pounds or 12,000 pounds I do not think anybody is going to argue that one.

MR. FITZGERALD: That is right, and now with the

extra quota they have for crab, well, the next thing you know they are looking

after themselves again, at least.

MR. EFFORD: That is right.

MR. FITZGERALD: Build on it from there.

MR. EFFORD: Yes. My concern was getting the

10,000 pounds or the 12,000 pounds, whatever they do get, are they going to

catch it?

MR. FITZGERALD: That should not be any problem,

if the last year is any indication.

MR. EFFORD: I cannot talk about Bonavista Bay

because you know more about that, but I know I went out fishing last year in

Conception Bay under the recreational fishery. The first day we went out we

caught our ten fish. The next day we never got them. That tells me there is not

much of a body of fish.

MR. FITZGERALD: It was not uncommon to do that,

Minister, as you know, when we had the fishery either.

MR. EFFORD: What did they do in Trinity Bay?

They had to go to Smith Sound where the big body fish are. They did not get them

in the traditional grounds. That gives me some concern. I hope and pray I am

wrong. I only hope they get the quota. Now, the other side of me says I hope

they don't, because if they don't then they are going to come screaming the

darned seals have eaten them all. Then they will shake David Anderson out of his

office.

MR. FITZGERALD: How about the food fishery? Not

a recreational fishery, a food fishery. Is there any indication what we might be

seeing this year?

MR. EFFORD: No.

MR. FITZGERALD: For God's sake, convince your

cousins to treat everybody alike.

MR. EFFORD: Not my cousins.

MR. FITZGERALD: Whatever it is they get up in

Nova Scotia, New Brunswick then -

MR. EFFORD: Don't you ever refer to them as my

cousins.

MR. FITZGERALD: - at least help us here as

well. It is the same thing. We are the same people, and it is the same fish.

MR. HUNTER: (Inaudible) question.

CHAIR: Mr. Hunter.

MR. HUNTER: (Inaudible). What percentage of the

total number of mussel farms is in Green Bay south?

MR. WARD: I will say that 60 per cent of all

the mussel production comes from the area in Green Bay. That basically equates

to the licences as well. I would say there is about 70 per cent -

MR. EFFORD: You should know that. It is your

district.

MR. WARD: About 70 per cent of all the licences

will be in Green Bay-Notre Dame Bay.

MR. EFFORD: You didn't know that?

MR. HUNTER: I figured somewhere around 70 per

cent. I did not know for sure. That is another reason to enhance the processing

in that area, rather than trucking it somewhere else.

MR. EFFORD: (Inaudible) Port de Grave.

MR. HUNTER: Particularly Port de Grave, yes.

Probably we could truck it to Buchans or somewhere. A fish plant in Buchans

would go over pretty good, wouldn't it?

CHAIR: Does anyone else have questions?

MR. FITZGERALD: (Inaudible). Minister, Grants

and Subsidies as well under each one of those headings there. Some of those are

talking about fairly large sums of money. Maybe you would like to explain a

couple of them, at least what they are all about.

For instance, Grants and Subsidies under 1.3.02.

Last year it was budgeted for $300,000 and the revision showed the exact amount.

This year the Grants and Subsidies is completely taken away.

MR. EFFORD: (Inaudible).

MR. FITZGERALD: Subhead 1.3.02., Resource

Policy Administration.

WITNESS: (inaudible) the Chair.

MR. EFFORD: Oh, the Chair?

If you are referring to the contribution that we

committed to the Chair at Memorial University, the Resource Conservation Chair,

we committed $1.5 million over a five year period, averaging $300,000 a year,

and this is the final year?

WITNESS: Last year was the final year.

MR. EFFORD: Last year was the final year.

George Rose, actually, a scientist -

MR. FITZGERALD: Money well spent.

How about moving up to Grants and Subsidies under

2.1.01., Administration and Support Services; again, government-owned marine

facilities. Would this be the money that I just asked you about, the $3,000 that

is being brought forward there?

MR. EFFORD: Yes.

MR. FITZGERALD: Grants and Subsidies,

2.3.01.10., Administration and Support Services, $480,000 revised to $308,000

and this year up to $380,000 again.

MR. EFFORD: Most of that is for the subsidy to

the seal meat program.

MR. FITZGERALD: Does that disappear this year?

MR. EFFORD: One more year.

MR. FITZGERALD: One more. What is it down to

now - two cents, three cents, eight cents?

MR. EFFORD: Sorry?

MR. FITZGERALD: What are we subsidizing per

pound this year?

MR. EFFORD: Oh, per pound -

MR. FITZGERALD: Not very much.

MR. EFFORD: It is $2.50 per carcass and $1.34

for the beaters.

MR. FITZGERALD: Okay.

That will probably change as well, depending on

what is taken.

Section 3.1.01.10., Administration and Support

Services, Grants and Subsidies, $115,000.

MR. EFFORD: That is for the mussel incentive

program.

MR. FITZGERALD:

Section 3.2.01., Economic

Renewal Agreement.

MR. EFFORD: That is for the fisheries

development.

One of the things that we have to do each year is

keep a component of the Department of Fisheries and Aquaculture for fisheries

diversification, underutilized species, research -

WITNESS: (Inaudible).

MR. EFFORD: This one here? Are you talking

about 3.2.01.?

MR. FITZGERALD: Yes.

MR. EFFORD: Okay, I am sorry. I thought you

were talking about the Economic Renewal Agreement. That is where -

MR. FITZGERALD: Yes, the Economic Renewal

Agreement.

MR. EFFORD: Yes, but that amount of money,

$3,589,500, is for the Research and Development Centre out at Logy Bay -

aquaculture.

MR. FITZGERALD: Yes.

I do not have any more questions.

MR. EFFORD: Thank you.

CHAIR: Anyone else? No more questions?

I have one comment, Mr. Minister.

MR. FITZGERALD: Minister, those (inaudible)

people you were in talking to, did they ever come back looking after?

MR. EFFORD: Not yet.

MR. FITZGERALD: Okay.

I talked to them the other day. You haven't heard?

You don't know anything more about that?

MR. EFFORD: No, I talked to you about that. I

haven't seen them since.

MR. FITZGERALD: They called me and wanted to

know if they could get a meeting. Then they called back after and said to hold

off.

CHAIR: Are you finished? I have a couple of

comments or questions.

The marine service centres, the one you had in

Durrell, you sold that one, I think, to private enterprise. That one is working

very well. I think you are having some problem with the one on Fogo Island, or

at least that is what I am hearing.

MR. EFFORD: We had a petition from a couple of

the fishermen on Fogo Island but I think it is just a matter of ironing out some

of the difficulties between the party who has the centre and some of the

fishermen. I do not think there is going to be any major problem there.

CHAIR: On the middle distance fleet, you say

you are going to have a $100,000 left over this year that you are not going to

spend because they got rid of the Nain Banker . I would certainly make a

recommendation that we put that into that facility repair program that you have.

It is one way you get $3,000, as Mr. Fitzgerald brought up, because I think that

is probably one of the better programs that we have in government, not just in

your department.

In my district - and I guess it is like all the

fishing districts in the Province - I do not know who built all the wharfs we

have, and maybe all of them were not needed, but it is a sin to see them fall

down when we can, for $2,000 or $3,000 a year, maintain those facilities. If we

let them all go, then your department is going to be faced with finding millions

of dollars one of these days to replace some of them around the Province. I

think that is probably the best program you have and I would certainly advise -

MR. EFFORD: We will take in under

consideration.

CHAIR: - definitely, for an extra $100,000 into

that.

MR. FITZGERALD: (Inaudible).

CHAIR: No, you go ahead.

MR. FITZGERALD: The thing about that too,

Minister - I do not know who drew up the criteria or brought forward the rules

and regulations. We are sitting here tonight and there is nobody who sits in

this House who does not believe that the fishery of Newfoundland and Labrador is

going to provide a future. There is a fishery, and there is going to be a very

vibrant fishery in the future.

For the federal government to come out and say that

the millions of dollars that were put forward in rural Newfoundland and Labrador

for make-work projects - call it whatever you want but that is what they were -

could not be spent on fisheries infrastructure. It makes you wonder where they

are coming from - the mind set. Here we are with the fisheries now coming back

in certain areas and we are encouraging people to get involved again, and they

are looking for quotas, and our fisheries infrastructure is falling down around

our ears.

MR. EFFORD: I do not know where you are coming

from because it must up to the MHA in a particular district. Everything that we

have invested out in Port de Grave is for fisheries infrastructure; $5.8 million

in the harbour development out there, fisheries infrastructure. They need a new

MHA, boy.

MR. FITZGERALD: Well, maybe that is the reason

but I will tell you that down in our area it was looked after by the regional

offices, and each regional office had their own rules and regulations -

MR. EFFORD: They should talk to (inaudible).

MR. FITZGERALD: - I suppose put forward by the

minister. In the Clarenville office they were very adamant. The only money that

got spent on wharf construction or repairs or slipway construction was the money

that came from the Ministry of Municipal and Provincial Affairs and I got

matched with federal dollars and put it in that direction myself.

MR. EFFORD: Lloyd gave you money?

MR. FITZGERALD: The federal money, that was the

criteria, the stipulation. No -

MR. EFFORD: Are you telling me that you got

money from the provincial Department of Municipal Affairs?

MR. FITZGERALD: I got my share from your

department, too.

MR. EFFORD: No, you did not.

MR. FITZGERALD: Oh, yes I did.

MR. EFFORD: No, you did not.

CHAIR: I will not argue about that but I have

to concur with Mr. Fitzgerald that the federal program -

WITNESS: (Inaudible).

MR. EFFORD: (Inaudible). I will check on that

tomorrow.

CHAIR: Are there any more questions? I will

call for the headings?

On motion, headings 1.1.01. through 3.2.02.,

carried, without amendment.

On motion, Department of Fisheries and Aquaculture,

total heads, carried.

CHAIR: We will meet again on Thursday at 5:00

p.m.

WITNESS: Tourism, Culture and Recreation.

CHAIR: Tourism, Culture and Recreation.

Thank you, Minister, for coming. Thank you to your

officials.

On motion, the Committee adjourned .