May 7, 2007 RESOURCE COMMITTEE

Pursuant to Standing Order 68, Wallace Young, MHA for St.

Barbe, replaces Charlene Johnson, MHA for Trinity-Bay de Verde.

The Committee met at 5:00 p.m. in the House of Assembly.

CHAIR (Mr. Harding): Order, please!

We have the signal to proceed, so I would like to welcome you all as we

debate the Estimates 2007-2008 for the Department of Business.

First of all, I would ask the Committee members to introduce themselves.

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

MR. HUNTER: Ray Hunter, MHA for Windsor-Springdale.

MR. BAKER: Jim Baker, MHA for Labrador West.

MR. YOUNG: Wally Young, MHA for St. Barbe, sitting in for Charlene

Johnson.

CHAIR: Harry Harding, MHA for Bonavista North.

We will follow the usual procedure. When the Clerk calls the first subhead,

the minister may begin. He will probably introduce his staff at that time, and

then give an overview of his department's Estimates for the coming year, up to

fifteen minutes.

The proceedings are recorded by Hansard, so I remind the officials with the

department, if you would, to mention your name prior to any time you are asked

to speak.

Following that, I would ask the Clerk now to call the first subhead.

CLERK: Subhead 1.1.01.

CHAIR: Subhead 1.1.01.

Shall that one carry?

Minister O'Brien.

MR. O'BRIEN: Good evening, Mr. Chair.

I would like to welcome the Resource Committee here tonight. It is indeed my

pleasure to appear before you this evening to discuss the Estimates of the

Department of Business.

This evening I have with me, to my immediate left, Leslie Galway, Deputy

Minister of the Department of Business. Next is Laurie Skinner, Assistant Deputy

Minister; Beulah Bouzane, Director of Strategic Policy and Planning. At my back,

at my far left, is Susan Clark, Director of Brand Development. In the middle is

Linda Vaughan, Director of Financial Operations, and right behind me is Jennifer

Dalton, Director of Communications.

The Department of Business has been allocated $38.2 million in the 2007-2008

Budget to fulfill its mandate to provide leadership for business development and

growth and create a business-friendly environment in Newfoundland and Labrador.

The largest announcement in Budget 2007 for the Department of Business was an

investment of $32 million to attract new business to Newfoundland and Labrador.

This is another significant investment as a part of government's commitment to

provide long-term sustainable business development in all regions of the

Province.

The new funding programs are aimed at providing the financial means to assist

organizations interested in the Province as a place to invest and establish

operations in Newfoundland and Labrador. It will be administered by the

Department of Business.

A Business Attraction Fund of $25 million will provide for large-scale

strategic investments in business ventures and infrastructure for the purpose of

attracting business to Newfoundland and Labrador. Through this fund, government

will be able to provide loans and equity investments to companies interested in

conducting operations in the Province.

In addition to the Business Attraction Fund, government has also committed $7

million for a grants fund. This non-repayable fund is designed to assist with

start-up and initial operational costs for large-scale companies setting up

business in the Province. The focus of the grants fund will be on bridging the

relocation and start-up costs of new operations in Newfoundland and Labrador and

establishing sustainable strong industries in the Province.

To facilitate the operations of the Business Attraction Fund and grants fund,

$1.9 million in core funding has been allocated to support the business

attraction mandate of the Department of Business. This includes five new

positions within the department to manage the operation of the new funds and to

conduct the required due diligence work on business attraction files.

In October 2006 the Province's new Brand Signature was launched. In Budget

2007 we have allocated funds to continue the implementation and development of

the brand and its strategy. The new Brand Signature is the identifier for the

Government of Newfoundland and Labrador, and the department will continue to

promote it in our Province, our country, and around the world.

As part of strategic planning and communications, the department will

continue its work on the Red Tape Reduction Initiative. The department has been

very successful to date with this program, removing 21,205 regulatory

requirements up to December 31, 2006. This equates to being over one-quarter of

the way to achieving the goal of removing 78,129 regulatory requirements in

three years. The objective in the years following the program is to have a 0 per

cent increase in regulatory requirements thereafter.

The department will also be focused in fiscal 2007-2008 on finalizing the

provincial investment attraction strategy. This will include the assessment of

the business environment in the Province. It will also include the development

of a formal strategy that clearly defines the government's goals and

objectives for business development and a plan to achieve this agenda. The

research and analysis is ongoing for this strategy, and the anticipated

completion date is before the end of the fiscal year 2007-2008.

In total, the Department of Business has a budget of $38.2 million for

2007-2008, and a total of thirty-four positions.

Mr. Chair, thank you for the opportunity to highlight some of the activities

of the Department of Business, and I would be happy to answer any questions.

CHAIR: Thank you, Minister O'Brien.

Mr. Joyce.

MR. JOYCE: Thank you, Minister.

First of all, I don't agree with my three members behind me who said that

you changed the meeting because you didn't want to take us to supper. I

disagree with the three members behind me.

MR. O'BRIEN: Absolutely.

MR. JOYCE: Who am I to disagree with three of them?

Minister, I will get some questions that my other two colleagues had, who

could not make it here. One is concerning some of your travel. Can you tell us

how much travel you did in the last year, inside or outside, or do you want to

just give it to us later?

MR. O'BRIEN: I can highlight some of the travel, I guess; I have no

problem with that.

I have been to Ottawa on a couple of occasions with regard to some of the

active files that we have in the Department of Business. I have been down to

Albany, New York, with regard to a very active file within the Department of

Business as well, and met with officials of that particular company. Also, we

did an international trip over to Doha, Qatar, and then on to Tokyo, Japan. I

had a number of meetings associated with that trip, mainly in Qatar, with the

Second Deputy Prime Minister of the country and also the Minister of Energy,

along with the Minister of Finance. We also met with the Chair of their

investment fund in the gas and oil sector. Then we went on to Tokyo and met with

probably close to between fifteen and twenty of the largest trading houses in

Japan. We met with some of the fabricators there as well, and we also met with

the Ambassador from Canada to Japan at that particular time.

MR. JOYCE: I was asked to do this: Would you table or send over a copy of

your expenses, or do we have to go through the freedom of information with it?

MR. O'BRIEN: I think it goes through freedom of information, but I

think that has already been done, to my knowledge.

MR. JOYCE: It has already been done?

MR. O'BRIEN: Yes, already been provided.

MR. JOYCE: Has any business come out of any of those travels yet?

MR. O'BRIEN: We are following up on a number of leads, and we are

aggressively pursuing those. I would not be able to comment on them at this

point in time, but certainly we have a number of them that we are following up

on.

MR. JOYCE: In Professional Services, there is an increase there of

$600,000 to about $1.5 million, a difference of about $891,000. Can you tell me

what that is for?

MR. O'BRIEN: Which subheading?

MR. JOYCE: Under Professional Services.

MR. O'BRIEN: Are you adding them all together, Executive Support and -

MR. JOYCE: Professional Services.

MR. O'BRIEN: There are Professional Services, actually, under each

heading. Strategic Planning and Communications, is that where you are?

MR. JOYCE: Under 1.2.01.01.

MR. O'BRIEN: Yes.

MR. JOYCE: No, that is the Salaries.

MR. O'BRIEN: That would be 1.2.02?

MR. JOYCE: Yes, .02.

MR O'BRIEN: Under .02.05?

MR. JOYCE: Yes, there is an increase there of about $891,000.

MR. O'BRIEN: Okay. Certainly, Professional Services - we, as the

Department of Business, are certainly dictated by our mandate. Also, in regards

to the extra staff coming on stream in the Department of Business, we are now

much more busier than we were previous. This includes such things as an agency

of record for business attraction and the provincial Brand Web design and

development, and provincial investment attraction and various other studies and

strategies that will be an underdevelopment for the Department of Business.

MR. JOYCE: Is all of this contracted out, or outside services?

Professional Services usually is.

MR. O'BRIEN: Yes.

MR. JOYCE: You just mentioned there was extra staff, but this has nothing

to do with that.

MR. O'BRIEN: No, it is just that we are able to actually -

MR. JOYCE: To save time, would you be able to give me a breakdown of how

this $891,000 extra - or all the money for Professional Services, not each. Like

what you just mentioned, what it is assigned to.

MR. O'BRIEN: Do you want it here tonight or do you want it -

MR. JOYCE: No, you can forward it to me later, just to save time.

MR. O'BRIEN: Sure, absolutely.

MR. JOYCE: You can forward it to me tomorrow, to save time.

MR. O'BRIEN: Yes, not a problem. We will take a note of that and have

it delivered to you.

MR. JOYCE: Yes, just to have it done.

MR. O'BRIEN: Yes, not a problem.

MR. JOYCE: Professional Services, are there Requests for Proposals or is

it tenders or -

MR. O'BRIEN: Requests for Proposals, following the proper processes.

MR. JOYCE: So there are no tenders. It is all Requests for Proposals?

MR. O'BRIEN: All Requests for Proposals.

MR. JOYCE: All of it?

MR. O'BRIEN: Yes.

MR JOYCE: Did you ever look at the Public Tender Act, or is it just

better for the department?

MR. O'BRIEN: Well, under Professional Services, it is all Requests for

Proposals. Correct?

WITNESS: (Inaudible) under Professional Services, RFPs.

MR. O'BRIEN: Yes, RFPs.

MR. JOYCE: Pardon me?

MR. O'BRIEN: They are all RFPs, Request for Proposals.

MR. JOYCE: No public tendering, or is it better for the department?

WITNESS: Professional Services are not required under the Public Tender

Act.

MR. O'BRIEN: No, it is not required under the Public Tender Act. Each

and every one of the particular companies that would have the expertise that we

are looking for would have the opportunity to submit a proposal. Each one has

had several companies actually bid. They are evaluated and then we determine

which one weighs the most and meets our needs. So, in some ways it is nearly

like a tendering process.

MR. JOYCE: Do you have a copy of which ones went out to Request for

Proposals last year and this year? Can we get a copy of that also -

MR. O'BRIEN: We can give you a copy of that as well.

MR. JOYCE: - to save time, instead of going through it now.

MR. O'BRIEN: Yes. Sure, no problem.

MR. JOYCE: The last question on that, I was asked to - services from

outside the Province. When you put out the Request for Proposals, are there many

services from outside the Province?

MR. O'BRIEN: Being provided?

MR. JOYCE: Provided, yes. We provide all the ones that are going to be

let or -

MR. O'BRIEN: No.

MR. JOYCE: Temporary employees: Do you have any temporary employees in

your department?

MR. O'BRIEN: Yes, we do.

MR. JOYCE: Can I ask how many, or is it just - because you can give me

that with the information also and we can save time. Did they go through the

regular Public Service Commission?

MS GALWAY: There are a number of temporary positions, all of which have

been through a competitive process. The Director of Red Tape Reduction and the

three policy analysts, for example, under Strategic Policy and Planning.

Under the Business Attraction category, there are a number of contractual

positions and many of those are unfilled at the present time. So, we are hoping

to do a competition coming up very shortly for those positions.

MR. JOYCE: Minister, also, just to save time with the other

documentation, can I get a copy of the position and the name of the person who

was in the position?

MR. O'BRIEN: Sure.

MR. JOYCE: Just to save time and -

MR. O'BRIEN: Yes, no problem.

MR. JOYCE: Do you expect to hire any more or is the hiring done for this

year?

MR. O'BRIEN: No, we are in the process of hiring as we speak, going

through the proper process in regards to classification of positions. We have

eight new positions in this Budget, along with a number of vacant positions as

of last year's Budget. Our aim is to fill them as soon as we can. There will

be competition on each one of them. So we are ramping up to that effect, to a

complement of thirty-four within the department.

MR. JOYCE: Again, to save time, is there a chance to get a copy of the

eight positions and what the positions are? I know they are not filled.

MR. O'BRIEN: Yes, absolutely. Not a problem.

MR. JOYCE: Okay, thank you - a lot of information after.

In the salary heading there, it says: temporary or other employees.

MR. O'BRIEN: Which salary heading?

MR. JOYCE: It is under salary headings, temporary or other employees, and

there is $1,613,000.

MR. O'BRIEN: That is made up of both temporary and contractual

employees. I can provide you with a breakdown of that category if you want.

MR. JOYCE: Yes, would you - so we can save time again - just send it

over, exactly what it is, what positions and the names of the people who have

filled in and which ones are vacant?

MR. O'BRIEN: Yes, sure.

MR. JOYCE: I am sorry, staff, to have you get all of this but it saves a

lot of time instead of going through each position now.

Business Attraction Fund, you spent $3 million last year, this year it is

over $38 million. What kind of initiatives are you looking at, minister, with

that $38 million?

MR. O'BRIEN: I did not hear your question.

MR. JOYCE: The Business Attraction Fund has gone up to $38 million this

year. What kind of business will you be looking for outside or inside the

Province?

MR. O'BRIEN: Well, we are certainly competing with a global

marketplace. We are competing against other regions and jurisdictions, not only

in Canada, but elsewhere in the world. When it comes down to the world, it is a

very small world in that regard. So we need a budget in regards to assisting

these companies to set up in their Province.

We are looking at emerging markets, new markets. We are developing a business

attraction strategy which will identify our key potential areas that would be

more attractive for companies to invest in the Province in those particular

sectors. Certainly, we are competing on the world stage with other

jurisdictions. We will keep our minds open in regards to whatever sector there

is, and which way, and what type of growth is in that particular sector.

MR. JOYCE: So, it this national and international, not provincial?

MR. O'BRIEN: This is national and international. Now, there will be

times when we would interact with other departments in regard to their files. It

depends on the type of file and how big the file is. We give support to a number

of departments with economic pieces attached to those departments, such as:

Natural Resources; Innovation, Trade and Rural Development; Fisheries; et

cetera. We would have a look at that file if we are asked by that particular

department to interact.

MR. JOYCE: For this fund, is there an application process for this or

just when you get an investment person or once you get a company involved? What

is the process for somebody to get at this $38 million?

MR. O'BRIEN: Well, we are trying to be flexible in regards to that

fund. Again, we are competing with a competitive market. We are competing with

other jurisdictions and regions. Those particular jurisdictions and regions have

their economic development department set up in certain ways, but we are also in

the process right now - because we have just been allotted the funding. Up until

now we have not had such a fund. So we are going to try to work some perimeters

working through that, and perimeters in regards to how we would administer those

funds but keeping flexibility in the back of our minds. We are also going to set

up a committee that will review files coming forward. We met with, from various

departments, deputy ministers. They will have a look at files, and on a

go-forward basis, the Department of Business will be able to grant up to

$500,000. After that point we go to Cabinet for final approval.

MR. JOYCE: What type of businesses would the department be looking at

with the $38 million?

MR. O'BRIEN: Oh, well, you are looking at various - you are looking at

aerospace. You could be looking at oil and gas. You could be looking at various

sectors. It depends on how that particular industry and sector is emerging.

There are various opportunities - the ITC sector.

MR. JOYCE: Did you get any inquiries so far into the fund? Was this an

initiative of the department, or was it something that came out of discussions

with the industry globally?

MR. O'BRIEN: We have dealt with about seventy-five files in the

Department of Business in one way or another, either in a supportive nature with

other departments or totally on our own. Currently we have twenty-five very

active files in the Department of Business which will probably require some sort

of funding at various levels, so we assess that in regard to the ask and it was

felt that we needed a fund that we could draw out of and enable us to compete

with the other jurisdictions and the other people we are competing with.

MR. JOYCE: So there is no criteria yet on it?

MR. O'BRIEN: No, it is under development. Again, we have to be flexible

in that regard.

MR. JOYCE: When do you expect to have the guidelines of the criteria

established?

MR. O'BRIEN: I would say over the next month to six weeks or so.

MR. JOYCE: Minister, we heard a lot about the branding. How much did the

branding cost last year?

MR. O'BRIEN: About $1.1 million.

MR. JOYCE: What did that include, Minister?

MR. O'BRIEN: That included the development of the brand, and also the

implementation and the launch of the brand.

As compared to other jurisdictions, Nova Scotia spent $1.4 million; Manitoba,

$2.1 million, I believe; and I think the City of Montreal spent somewhere around

$23 million in regard to the development of that brand.

As a matter of fact, as a note, New Brunswick now have struck a task force,

and it is recommended by the New Brunswick government, in regard to their

prosperity plan, that re-branding is at the top of the list.

MR. JOYCE: Does that $1.4 million include the changing of the logos in

the departments, and letterhead and -

MR. O'BRIEN: It was felt, in regard to the implementation process, that

would be done across departments at their cost, but also that it would be done

on a timely basis in regard to when something had to be changed so then it would

be incorporated in the normal spending habits of the department.

A good example of that would be vehicles within Natural Resources. A vehicle,

at various times, comes out of service. When that vehicle would be replaced, the

new brand and logo would be replaced on that particular vehicle at that

particular time. We would not go out and purchase a new vehicle or change and

cost the introduction and the placement of the brand on the existing vehicles

that we have in the fleet.

MR. JOYCE: Actually, the whole implementation of the brand is going to

cost more because each department has to do their own in-house service with it.

Is there any estimated cost of that?

MR. O'BRIEN: I do not have an estimated cost because that is up to the

particular departments; but, as I said, in the fiscal and responsible way, that

would not incur on a daily basis in regard to having it placed on, as I just

said, vehicles. We would incorporate it across departments as something came out

of service, or something was going to be changed in that particular department,

due to, as I will say again, vehicles coming out of service. That is a good

example.

MR. JOYCE: You mentioned that this year some of the funds you have are

also for branding.

MR. O'BRIEN: Yes.

MR. JOYCE: How much will be spent this year towards the branding?

MR. O'BRIEN: If I remember right - $250,000, right?

WITNESS: (Inaudible).

MR. O'BRIEN: Yes, that is what I thought, $250,000.

MR. JOYCE: This year?

MR. O'BRIEN: Yes.

MR. JOYCE: What is that for, Minister, may I ask?

MR. O'BRIEN: Certainly, we have seen success in regard to the

implementation and the launching of the brand in the Province. It has been

accepted and welcomed by the business community, the Chambers of Commerce,

Boards of Trade, et cetera, so now we will start moving out in regard to the

national and international market, in regard to marketing a brand and getting

equity and gaining equity in the brand for the Department of Business and for

the Province.

MR. JOYCE: It was $1.4 million last year.

MR. O'BRIEN: One point one million.

MR. JOYCE: One point one million?

MR. O'BRIEN: Yes.

MR. JOYCE: I thought it was $1.4 million.

MR. O'BRIEN: Also, that would include a completion of our marketing

strategy and the implementation of that marketing strategy. Also, the Web design

as well is all included in that number. I think you are looking at a difference,

if I want to correct myself, the difference is about a total of $900,000, if we

were to include all of that as well under Professional Services.

MR. JOYCE: Nine hundred thousand for when? I missed that. Nine hundred

thousand for this year?

MR. O'BRIEN: Under Professional Services, yes.

MR. JOYCE: This year?

MR. O'BRIEN: Yes.

MR. JOYCE: Last year it was $1.4 million, I thought you said.

MR. O'BRIEN: No, $1.1 million.

MR. JOYCE: One point one million, and another $900,000 this year?

MR. O'BRIEN: Yes.

WITNESS: The $900,000 includes not just the brand, but implementing and

marketing strategy as well.

MR. O'BRIEN: That is what I said. If we included the marketing strategy

and the implementation of the marketing strategy, and also the implementation of

that, that is all included in that figure, so you would have to break that -

MR. JOYCE: So it is all related to the branding?

MR. O'BRIEN: Well, it is a part of going out there and marketing your

Province in regard to the business side and the business attraction side of the

department. You would have that anyway, regardless of if you had a brand or no.

MR. JOYCE: So it was $1.1 million last year and $900,000 this year?

MR. O'BRIEN: That is correct.

MR. JOYCE: Request for Proposals for the branding, was that all done

through a Request for Proposals in the -

MR. O'BRIEN: That is all done through an RFP process.

MR. JOYCE: Is it all done in the Province or outside, can I ask?

MR. O'BRIEN: The company, the Agency of Record, was a Newfoundland and

Labrador company.

MR. JOYCE: Perfect.

Minister, have you seen any positive results from that yet?

MR. O'BRIEN: I certainly do, to be honest with you, in regard to brand,

because I come from a business world. There is equity in brand in regard to that

piece. I often reference the Nike swoosh, I reference the big M for McDonald's,

and it all comes down to identity.

Certainly, with forty-three different brands out there being used by

government departments and agencies across the world, in my opinion, as a

business person, it spells confusion. You have no identity.

We have to have consistency when we go out and market the Province, and in my

travels so far I have had great comments in regard to the brand. Certainly, they

ask what it means. It gives me a chance to talk about our workforce, our

culture, our history and our Province. I have had comments from Senators. I have

had comments from other world leaders in regard to that brand, certainly on that

point, and I have often said in this House of Assembly, we will not and never

will be able to contribute one business file being attracted to the Province, to

the brand. It is a part of the tool kit of the Department of Business. It gives

us consistency and equity in the Province, and that is what it is all about.

As I referenced in my comments, all the other jurisdictions are there

developing brands. The New Brunswick government now has struck a task force and

made it the highest priority - Nova Scotia, the City of Montreal, and Manitoba.

As a matter of fact, in a restaurant in Ireland - I wasn't there, because I

have not been in Ireland in a number of years, but - a person was wearing

something with the brand on it, and a person came over and asked him what the

brand was all about, and recognized that brand with regard to looking at the

Province of Newfoundland and Labrador in regard to the Web.

MR. JOYCE: Minister, just a note here. Just give us some examples of some

of the jobs or initiatives or businesses that were attracted so far by the

Department of Business.

MR. O'BRIEN: We have only been in business for a very short period of

time. Certainly, the Premier laid the foundation. I was appointed on July 5,

2006. We have assisted intricately on files within other departments: Fisheries,

Cooke Aquaculture, INTRD, Natural Resources.

Up to this Budget, we have not had a fund in regards to being able to go out

there and actually administer funds and grant funds to an investment business

from outside the Province. So we certainly relied on other departments in that

regard.

Like I said, we have twenty-five very, very active files within the

Department of Business. I would not be able to give you a number in regards to

job creation at this point in time because they lie within other departments

that we have assisted, but we will move forward.

The part of the Department of Business is building a friendly business

environment in Newfoundland and Labrador. We have to make sure that we present

ourselves as the best place to do business, and establish themselves and to live

and work. So the RTR, Red Tape Reduction, was very important in that regard and

the various other initiatives that have been undertaken by the Department of

Business.

In that regard, I would not be able to put a number to it. Certainly, the

Cooke Aquaculture one, if you want to reference that one, would be a part of our

piece as well; even though the lead department is the Department of Fisheries.

MR. JOYCE: You did have some funds that you administered. Again, to save

time, can I get a copy of the businesses that were given funds from the

Department of Business in the last year?

MR. O'BRIEN: I would have to ask for clarification from Justice on that

because, certainly, the businesses themselves have proprietary information

listed to it, but -

MR. JOYCE: I am sure under the Freedom of Information we can get it

because if you give out government money, I am sure it is (inaudible).

MR. O'BRIEN: Yes, but you see, up to this point we did not have it. So

we are not really telling you anything, because up to this Budget, right now, we

had no attraction funds in the Department of Business.

MR. JOYCE: So the year prior, there was no money given out by the

department?

MR. O'BRIEN: No, we only had operating only.

MR. JOYCE: Would it be correct if I said there were no funds given out

over the past year?

MR. O'BRIEN: Would it be correct?

WITNESS: Yes.

MR. O'BRIEN: Absolutely, yes. We worked across other departments to

provide funding.

MR. JOYCE: Did the money for Griffiths Guitars come from the Department

of Business?

MR. O'BRIEN: Say that again.

MR. JOYCE: Griffiths Guitars?

MR. O'BRIEN: Yes, that came from the Department of Business, the

Minister's Office and Executive Support.

WITNESS: (Inaudible).

MR. O'BRIEN: Griffiths Guitars? The Department of Business, no. I did

not hear you, I thought you said Qatar.

MR. JOYCE: I heard you saying yes and the deputy was saying no. Okay.

MR. O'BRIEN: I did not hear you, I am sorry.

MR. JOYCE: No, that is fine.

MR. O'BRIEN: I thought you said the trip.

MR. JOYCE: Does your department have a Director of Communications now?

MR. O'BRIEN: Yes, I do. Right behind me, Jennifer Dalton.

MR. JOYCE: Is this the first year they have a Director of Communications?

MR. O'BRIEN: Yes, it is.

MR. JOYCE: You have to have one of them.

Under 1.2.01, Salaries Estimates decreased in 2006-2007.

MR. O'BRIEN: Are you talking about the $561,500?

MR. JOYCE: Under Executive Support. Yes, the $561,000. There is an

increase there of almost $200,000.

MR. O'BRIEN: Yes.

MR. JOYCE: Is that, again, to hire people or people already hired?

MR. O'BRIEN: That is to hire people; seven positions in total under

Executive Support, which includes a Deputy Minister; two ADMs; a Director of

Communications; a secretary to the DM, a secretary to the ADMs, and the

receptionist.

MR. JOYCE: Are they all new positions this year?

MR. O'BRIEN: No.

MR. JOYCE: Because there is an increase there of $197,000.

MR. O'BRIEN: Yes.

MR. JOYCE: What positions are they going to be? The extra increase in the

MR. O'BRIEN: The new ones? Do I have a list of the new ones? I have.

Just a second.

MS GALWAY: In terms of the difference in positions from one year to the

next has to do with vacancies. There will be a filling of a second ADM during

this year for Strategic Policy. We have a secretary to the ADM, which will be

filled. That should account for most of the difference, as well as a small

amount that would be additional for regular salary increase.

MR. JOYCE: So there is another ADM?

MS GALWAY: Yes. It was vacant last year. It will be filled this year.

MR. JOYCE: Is there a line there, 02., for Employee Benefits, a severance

package? Is that under 02.?

MR. O'BRIEN: A severance package?

WITNESS: (Inaudible).

MR. JOYCE: No? Okay, or a retirement package or something.

MR. O'BRIEN: If there is a severance it is paid from Salaries.

MR. JOYCE: Pardon me?

MR. O'BRIEN: If there is a severance it would be paid from Salaries,

not from Employee Benefits.

MR. JOYCE: Okay.

Subhead 03., it has gone from $83,000 to $173,000, a difference of about

$90,000; Transportation and Communications.

MR. O'BRIEN: Certainly, as we engage in a proactive nature in regards

to marketing the Province and engaging with various business opportunities we

anticipate more transportation and more international travel, national travel in

regards to meeting the mandate of the Department of Business. So, we anticipate

that we will have that within the fiscal year of 2007-2008. Our estimates

reflect that amount.

MR. JOYCE: That is the travel for the department or -

MR. O'BRIEN: For the executive.

MR. JOYCE: For the executive.

MR. O'BRIEN: The list that I just referenced in regards to my deputy

minister -

MR. JOYCE: One hundred and seventy-three thousand dollars?

MR. O'BRIEN: Yes, and the reason behind that is, you must remember,

that the majority of our travel is going to be primarily national and

international travel, not domestic.

MR. JOYCE: International and national.

MR. O'BRIEN: And national.

MR. JOYCE: In 05., Professional Services, Executive Support, the

Department of Business requires to the tune of $138,000. In 2006-2007 there was

$50,000. In 2006-2007 there was only $50,000 spent?

MR. O'BRIEN: Yes.

MR. JOYCE: This year it is back up to $138,700.

MR. O'BRIEN: That was due to vacancies within the department, and with

the ramp up we anticipate that we will require the full $138,700 this year in

regard to Professional Services.

MR. JOYCE: Is that position filled yet?

MS GALWAY: It is not related to positions, except that you have to have

the positions to support the studies, so -

MR. JOYCE: It is what, sorry?

MS GALWAY: It is for Professional Services, for studies that would be

associated with the department; so, in order to conduct that, you have to have

the executive in place to do those studies.

This past year we had, in Executive Support, a deputy minister for the full

year, one ADM was hired in January, so it was really only in the last quarter.

This year we will have a full complement and we will be able to support the

studies that we would anticipate would come up on an annual basis.

MR. JOYCE: Will it be positions -

MR. O'BRIEN: No.

MR. JOYCE: - or is it contracting out?

I am missing -

MR. O'BRIEN: You might have misunderstood me.

MR. JOYCE: Yes.

MR. O'BRIEN: We carry out and execute various studies and strategies

within the Department of Business. Due to the vacancies that we had in the

previous year, we did not use the full amount of $138,700 as was budgeted in the

2006-2007 Budget. Now, because of the ramp up and the hiring process within the

Department of Business, and the filling of those vacancies, we anticipate that

we will need the full $138,700 because we will have the staff and the bench

strength to carry out those particular studies and strategies.

MR. JOYCE: Okay.

Will the people within the department be doing this work, or will it be sent

outside?

MS GALWAY: There will be managing contractors.

MR. JOYCE: Will there be someone already on staff? I am missing

(inaudible) the $138,000. Is there someone already on staff who will manage the

contract, or will you bring someone in to mange the contract?

MS GALWAY: What will happen, it will support various types of research

projects that are considered relevant for a particular year, and those contracts

will be managed by the executive group.

Last year we had, as I mentioned, a deputy minister in place for the full

year, and then, for the last quarter of the year, one ADM, and it was not

possible to spend all of the money.

It will be used for labour market analysis, economic studies and financial

studies.

MR. JOYCE: Minister, there was a lot of talk about the sixth floor being

done up. Do you have an estimate of how much it will cost to do up the floor

itself?

MR. O'BRIEN: Yes, we do. That was in last year's budget, actually.

MR. JOYCE: I am saying, to save time, would you be able to just send that

over with the rest of the stuff?

MR. O'BRIEN: Sure I can, absolutely.

MR. JOYCE: What it was for, and all of that, just to save time, instead

of having to go through it.

MR. O'BRIEN: Yes, not a problem.

MR. JOYCE: Thank you.

In Strategic Planning and Communications, last year there was a savings of

about $72,000. This year it looks like there is an increase of $235,000.

MR. O'BRIEN: Which heading?

MR. JOYCE: Subhead 1.2.02.01.

Are they the positions that we discussed earlier, that will be sent over

after?

MR. O'BRIEN: Yes, there are twelve positions within that subheading.

MR. JOYCE: Are they already filled, Minister?

MR. O'BRIEN: There are three newly-funded permanent employees who are

funded under this budget.

If I could make a correction, there are actually eleven positions.

MR. JOYCE: Okay.

MR. O'BRIEN: I am sorry about that.

MR. JOYCE: There are three permanent?

MR. O'BRIEN: No, three new.

MR. JOYCE: Three new, sorry.

MR. O'BRIEN: And, they will be permanent positions. There are currently

three permanent; two filled, one vacant. There are four in Red Tape Reduction

that are temporary, and there is one contractual.

MR. JOYCE: Will that be part of the information that will be sent over to

me with the -

MR. O'BRIEN: It sure can.

MR. JOYCE: It will save a lot of time.

Who is the contractual person, Minister? Is that short term, long term?

MR. O'BRIEN: That contractual position is the Director of Brand.

MR. JOYCE: Is it someone within the department, hired on, or is it just

contracted outside?

MR. O'BRIEN: No, in the department.

MR. JOYCE: Short term or long term contractual?

MS GALWAY: It is renewed annually. It is looked at for renewal annually.

MR. JOYCE: Okay.

Who is in the position now?

MS GALWAY: Susan Clark.

MR. JOYCE: Thank you.

Minister, if it is such an important thing, I think the position should be

given permanent status.

MR. O'BRIEN: I will take that under advisement.

WITNESS: (Inaudible) realized he had erred in his ways.

MR. JOYCE: No, I never.

WITNESS: (Inaudible).

MR. JOYCE: If you are going to go all around the world with the branding,

and you are going to make it a permanent thing, instead of having someone

temporary then make them permanent.

Under 1.2.02.03., Transportation and Communications, there is a savings of

about $63,000 from last year.

MR. O'BRIEN: Yes, there was.

MR. JOYCE: What is that money for, in that subhead there?

MR. O'BRIEN: Transportation and Communications, Strategic Planning,

1.2.02.?

MR. JOYCE: Yes.

MR. O'BRIEN: Again, it is in regard to travel related to the activity

and the mandate of the Department of Business. Again, both national and

international travel mostly.

MR. JOYCE: You have travel up there and transportation down here. I am

missing the difference. If you have, up here, travel for international travel,

and you have transportation down here, what is the transportation for

international travel?

MR. O'BRIEN: It is under the same category, if we are looking at

Strategy Planning and Communications.

MR. JOYCE: Yes.

MR. O'BRIEN: There will be international travel and national travel

attached to those positions as well - and there are eleven positions under that

category - from time to time.

MR. JOYCE: Okay, thank you.

In 05. of the same subhead, under 1.2.02.05., Professional Services, that has

gone up, almost tripled, again. What type of services would you be using for

that?

MR. O'BRIEN: That includes the providing of an Agency of Record for

business attraction, and the provincial brand. It also includes the provincial

Investment Attraction and other miscellaneous policy research and analysis.

MR. JOYCE: Earlier when we said that some of the Brand cost about another

$900,000, is this extra money for the branding or is this included, because you

just mentioned it is for the Web design?

MR. O'BRIEN: That is one and the same.

MR. JOYCE: That is all the same?

MR. O'BRIEN: That is all the same.

MR. JOYCE: Okay.

In 2.1.01., in Salaries there was a savings last year of $424,000 and an

increase this year of about $600,000. I am assuming that would be in the

positions that would be sent over, what new positions, and if anybody is in

those positions. If not, the title then, who is in them and when do you expect

to fill them, instead of having to go through them.

MR. O'BRIEN: We can provide that.

MR. JOYCE: Thank you.

Again, Business Attraction, Transportation and Communications, there was a

decrease of about $100,000, this year. There is a bit of a decrease in the whole

Budget, just for that Transportation and Communications.

MR. O'BRIEN: Again, it is related to travel, international and

national, by the positions within that department in regards to the Business

Attraction side.

MS GALWAY: With respect to Transportation and Communications for Business

Attraction, that is increasing as a result of filling of vacant positions, as

well as the new positions that are coming on. These include, and we will provide

you with the list, as you requested: principal investment advisor, Director of

Business Investment and so on. There are six positions involved in Business

Attraction itself and then there are also some further positions to support the

programs.

MR. JOYCE: Okay, thank you.

In Business Attraction again, 05. Professional Services, there is an increase

this year, a fairly big increase, actually. What would that be used for in

Professional Services, 05.?

MR. O'BRIEN: Again, it includes special projects and the due diligence

side of some of our files. It is also going to include contracts in regards to

proactive (inaudible) generation and research related supports as well.

MR. JOYCE: Special projects for what? I am sorry about that.

MR. O'BRIEN: Special projects, such as the IMFI project, which is the

Industrial Marine Fabrication Initiative.

MR. JOYCE: That is the anticipated of what you need. What type of

professional services would be needed for that?

MR. O'BRIEN: Well, various items in regards to the renting of meeting

rooms outside of government; the renting of various equipment needs.

WITNESS: (Inaudible) Purchased Services.

MR. O'BRIEN: I am sorry, I did not hear the question again.

MR. JOYCE: I was going to say, $737,000 for meeting rooms.

MR. O'BRIEN: No, I was in Purchased Services. I thought you went to the

next one. Is it in Professional Services?

MR. JOYCE: Professional Services, 05.

MR. O'BRIEN: Okay. Again, it is being spent in regards to the

miscellaneous studies and contracts that we would have throughout the year, and

strategies that may very well be developed within the Department of Business.

MR. JOYCE: Are there any specified now or is that just an estimated

amount that you may need?

MR. O'BRIEN: Just an estimate amount.

MR. JOYCE: Did you use any of that money last year? It looks like there

was some used.

MR. O'BRIEN: Yes, we did.

MR. JOYCE: Can I get a copy of what services were used, if it was

tendered, public tendering or just included in the -

MR. O'BRIEN: Yes, sure.

MR. JOYCE: So that we can have an idea of what type of projects it would

be used on, actually.

Once again, we see under Business Attraction, Purchased Services - contractor

services - in the amount of $305,000.

MR. O'BRIEN: That was my last answer.

MR. JOYCE: Pardon me?

MR. O'BRIEN: That would be my last answer.

MR. JOYCE: This $305,000 is for setting up meetings or -

MR. O'BRIEN: Yes, mostly collateral materials and supportive equipment,

et cetera, that we would need. Also included in that would be the provincial and

territory meetings that we would have to attend from time to time.

MR. JOYCE: So, it is more travel?

MR. O'BRIEN: No.

MS GALWAY: We contributed our share of the cost of a particular meeting

or event.

MR. O'BRIEN: It would not include travel.

MR. JOYCE: Special Initiatives - Investment Attraction, $7 million. Was

that part of the $28 million? This is 2.1.02.10, $7 million. Is that what we

discussed earlier or is this new funding?

MR. O'BRIEN: It is new funding. It is the grants and subsidies within

the Department of Business.

MR. JOYCE: Is this the first year for it?

MR. O'BRIEN: This is the first year.

MR. JOYCE: Is this provincial or federal?

MR. O'BRIEN: This is provincial.

MR. JOYCE: Do you have a criteria established for that yet?

MR. O'BRIEN: Not at this point in time, but it is certainly going to be

developed over the next month or six weeks.

MR. JOYCE: The Business Advisory Committee, is that active in supporting

or giving advice to the minister on that?

MR. O'BRIEN: Very active.

MR. JOYCE: Can we get a copy of who is on that committee now?

MR. O'BRIEN: You sure can.

MR. JOYCE: Okay. This $7 million, there is no criteria set up whatsoever

yet or is it just being developed now?

MR. O'BRIEN: It is being developed. Certainly, it will support the

Department of Business in such things as labour cost subsidies in the initial

set up of businesses within the Province. It will be a non-repayable grant that

will be provided, depending on the needs of that particular company or business

sector.

MR. JOYCE: Minister, last year your department spent about $3.5 million

and this year it has gone up to $38 million. Are any of those funds already

committed, pre-committed? You mentioned you do not have a criteria developed yet

for the international or the provincial.

MR. O'BRIEN: There are no pre-commitments on the Business Attraction

Funds at all.

MR. JOYCE: Absolutely none?

MR. O'BRIEN: None.

MR. JOYCE: And those are the only funds you have?

MR. O'BRIEN: Those are the only funds we have.

MR. JOYCE: There is no pre-commitment?

MR. O'BRIEN: No pre-commitment.

MR. JOYCE: Okay.

Well, Minister, those are all the questions I have.

One second, now. Oh, yes, this is the last one that I was supposed to be

asking. Was there any polling done by your department?

MR. O'BRIEN: Polling?

MR. JOYCE: Polling.

MR. O'BRIEN: For?

MR. JOYCE: For international business, and business around logos.

MR. O'BRIEN: No, there would not be any polling as such. Certainly, we

watch the various sectors and various corporations around the world in regard to

their business plans and visions for their particular companies. If there is an

opportunity then we would engage and contact.

MR. JOYCE: So there was no polling done, per se, of businesses?

MR. O'BRIEN: No, no contracts.

MR. JOYCE: I guess the Director of Communications - how about the media

monitoring? Is there any part of your budget set aside for that?

MR. O'BRIEN: No, I do that all myself because I listen to Open Line all

the time.

MR. JOYCE: I don't know if you are -

MR. O'BRIEN: I am sorry.

MR. DALTON: Yes, we do some media monitoring, especially during brand

last year. We would have -

MR. JOYCE: Again, to save time, instead of going through it, can I get a

copy of that included?

MR. DALTON: Sure, that is no problem.

MR. JOYCE: Minister, say that again? I didn't -

MR. O'BRIEN: I couldn't resist the piece about Open Line.

MR. JOYCE: I will get a copy of that?

WITNESS: (Inaudible).

MR. JOYCE: Okay, perfect.

You mentioned the red tape reduction. I agree with that, by the way.

MR. O'BRIEN: Thank you.

MR. JOYCE: I definitely agree with it. I think the more you can do, the

better off you will be.

Is there anything developed yet of what red tape reduction is already taken

out of the system; what, if any, provisions or regulations are already taken

out?

MR. O'BRIEN: Yes, there are over 21,000 to date taken out of the

system.

MR. JOYCE: I know you wouldn't be able to give me the 21,000, but the

main ones, do you have a copy of that broken down for the department, that

anybody can get a copy of?

MR. O'BRIEN: It is a very extensive piece.

MR. JOYCE: Okay, that is fine.

I think anybody outside government who is dealing with the government agrees

with that, by the way.

MR. O'BRIEN: There are certainly examples that we can use in regard to

natural resources or forestry. Within natural resources, at one time, a person

who would apply for a permit to harvest cut wood would have to apply to each and

every region in the Province and each and every office in the Province. Now,

natural resources, in regard to RTR, you have one application and one fee

attached. They removed the number of requirements under the red tape reduction

to assist in regard to providing better services to the public.

MR. JOYCE: Okay.

Well, that is it for me. The best of luck with it. I have not seen too many

results yet, but hopefully we will. Anything that is good for the Department of

Business will be good for the Province, so I welcome any new business that is

going to come in to create jobs.

I thank yourself and the staff for your indulgence in putting up with me for

an hour, or an hour and fifteen minutes.

Thank you very much.

MR. O'BRIEN: Thank you.

CHAIR: Thank you, Mr. Joyce.

Any further questions from the Committee members?

No further questions.

I will ask the Clerk now to call the subheads.

CLERK: Subhead 1.1.01. to 2.1.03. inclusive.

CHAIR: Shall subheads 1.1.01. to 2.1.03. inclusive carry?

All those in favour, aye'.

SOME HON. MEMBERS: Aye.

CHAIR: All those against, nay'.

Carried.

On motion, subheads 1.1.01. through 2.1.03. carried.

CHAIR: Shall I report the Estimates of the Department of Business

2007-2008 carried without amendment?

All those in favour, aye'.

SOME HON. MEMBERS: Aye.

CHAIR: All those against, nay'.

Carried.

On motion, Estimates of the Department of Business carried without amendment.

CHAIR: I just want to remind the Committee members that our next meeting

will be tomorrow morning at 9:00 o'clock here in the House. We will debate the

Estimates of the Department of Innovation, Trade and Rural Development.

Let's have a motion now to accept the minutes of our previous meeting, as

circulated. Will someone move -

MR. HUNTER: A correction, Mr. Chair: 10:00 o'clock tomorrow morning.

CHAIR: At 10:00 o'clock tomorrow.

MR. HUNTER: You said 9:00 o'clock.

CHAIR: Okay, that meeting is 10:00 o'clock tomorrow.

Do I have a motion now to adopt the minutes of our last meeting as

circulated?

MR. HUNTER: So moved.

CHAIR: Moved by Mr. Hunter.

MR. BAKER: Seconded.

CHAIR: Seconded by Mr. Baker, that those minutes be adopted as

circulated.

All those in favour, aye'.

SOME HON. MEMBERS: Aye.

CHAIR: All those against, nay'.

Carried.

On motion, minutes adopted as circulated.

MR. JOYCE: Minister, it won't take long for me to get that information,

will it?

MR. O'BRIEN: No.

MR. JOYCE: A couple of days or so, because I am sure it is all there.

MR. O'BRIEN: (Inaudible).

MR. JOYCE: Thank you again for that.

CHAIR: I would like to take the opportunity to thank the minister and his

officials for being here and taking

part in the debate on their department's

Estimates. I would like to thank the Committee members and the House of Assembly

staff.

That concludes this meeting.

I will ask for a motion to adjourn.

MR. JOYCE: So moved.

CHAIR: Moved by Mr. Joyce.

This meeting is now adjourned.

On motion, the Committee adjourned.