June 3,

HOUSE OF ASSEMBLY PROCEEDINGS

Vol. XLIII No. 20

The House met at 2:00 p.m.

MR. SPEAKER (Snow): Order, please!

Before we begin routine proceeding, the Chair would like to

welcome, on behalf of all members, fifty-six Grade V students from Woodland

Elementary in the district of Trinity - Bay de Verde. They are accompanied by

their teachers, Barry Smith and Richard Woodrow, along with chaperons, Ms Pike,

and Ms Hefford, and bus driver, David Warford.

SOME HON. MEMBERS: Hear, hear!

Statements by Ministers

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

Transportation.

MS BETTNEY: Mr. Speaker. I would like to inform hon.

members that 2 June to 8 June has been proclaimed as National Transportation

Week, and this year's theme is "National Transportation: The Urban Connection."

National Transportation Week is a time to help

Newfoundlanders and Labradorians learn about what transportation means to them.

It is a time to celebrate the efforts of many thousands of Canadian workers in

the transportation industry, and to appreciate their role in the economic and

social development of Canada.

Mr. Speaker, as this year's theme appropriately states, urban

linkages are an essential component of our national and provincial

transportation system. As goods and people pass through the urban network to

their ultimate destination, an efficient system is crucial.

Because of its geography, Newfoundland and Labrador's

residents and businesses strongly depend on an efficient transportation network

for the fast and capable movement of goods and people in around the Province.

This is essential for our Province's continued socio-economic well-being and

development, both at home and globally.

Mr. Speaker, at the National Kick-Off ceremonies this past

Friday in Vancouver, I am pleased to announce that Mr. Craig Dobbin was awarded

the "Transportation Person of the Year" award for Canada.

SOME HON. MEMBERS: Hear, hear!

MS BETTNEY: Mr. Dobbin is the Chief Executive Officer of

CHC Helicopter Corporation.

In addition, Awards of Valour were presented to the crew of

the Leonard J. Cowley for the rescue of twenty-four crew members from a sinking

bulk carrier. Receiving as well this award of valour was Michael J. Ledrew, the

CN bus driver who averted a major tragedy from occurring when the bus carrying

figure skaters collided with a moose earlier in the Spring.

In conclusion, Mr. Speaker, I would like to take this

opportunity to salute the many hundreds of men and women in Newfoundland and

Labrador who work in our transportation industry. It is these people who really

keep Canada moving.

Thank you, Mr. Speaker.

SOME HON. MEMBERS: Hear, hear!

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

MR. H. HODDER: Thank you, Mr. Speaker.

On behalf of my colleagues, I want to join the minister in

noting "National Transportation Week: The Urban Connection", and to also join

her in taking note of the tremendous part that good transportation plays in the

growth of the Newfoundland economy and, of course, in the economy of all of the

country.

Mr. Speaker, we, as well, would want the minister to reflect

on transportation in our Province of Newfoundland and Labrador, and particularly

the connection with some of our remote areas and the important role that

highways and ferry connections play in the continual growth of our Province.

We would also want to join with the minister in

congratulating Mr. Craig Dobbin as the Transportation Person of the Year for

Canada. It is indeed a distinguished honour and a distinct honour, and we, on

this side of the House, take great pride in being able to join the minister in

this particular credit to Mr. Dobbin. In addition, we would join the minister in

congratulating the crew of the Leonard J. Cowley involved in the rescue

of twenty-four crew members from the sinking bulk carrier.

A note was made, also, of Michael Ledrew, and we all remember

with pride, his efforts to avert, what would have been a tragedy to the figure

skaters when the bus collided with a moose.

MR. SPEAKER: Order, please!

The hon. member's time is up.

MR. H. HODDER: Mr. Speaker, we are very delighted to join

the minister in these particular comments.

MR. SPEAKER: The hon. the Member for Signal Hill - Quidi

Vidi. Does he have leave?

Does the hon. member have leave?

AN HON. MEMBER: Absolutely.

MR. SPEAKER: By leave.

MR. HARRIS: Thank you, Mr. Speaker.

We, of course, join with the minister and the Member for

Waterford Valley in acknowledging National Transportation Week, also to

congratulate Mr. Craig Dobbin on his recognition in the field of transportation,

and to honour, as well, the crew of the Leonard J. Cowley and Michael

Ledrew for their efforts.

I wonder, Mr. Speaker, whether the people of Bell Island

would be as enthusiastic in their praise of this government, or the people whose

services around the Province were taken over by this government and downgraded

since that time, would be congratulating the government on the role that it

plays in transportation; or the bus students in St. John's who can't travel back

and forth to their schools because there is no provincial subsidy for urban

transportation in St. John's.

So, while we recognize that it is an important issue, there

is a lot of progress to be made and a lot of room for criticism of this

government.

Thank you, Mr. Speaker.

Oral Questions

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

MR. SULLIVAN: Thank you, Mr. Speaker.

My questions today are for the acting Minister of Development

and Rural Renewal.

The Federal Government's labour market proposal offers

provinces and territories an opportunity to deliver active employment measures

such as wage subsidies and income support, as well as labour market services

such as screening and employment counselling. Will the minister tell this House

what the Province's position is on this, and will you be signing an agreement?

MR. SPEAKER: The hon. the Minister of Industry, Trade and

Technology.

MR. FUREY: Mr. Speaker, I apologize; the Minister of

Development and Rural Renewal is in her district today with the Minister of

Fisheries on Her Majesty's business, but we will take the questions under

advisement and have her respond at the appropriate time.

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

supplementary.

MR. SULLIVAN: Thank you, Mr. Speaker.

I ask the Premier: Will he tell this House what the

Province's position is, and will you be signing an agreement?

MR. SPEAKER: The hon. the Premier.

PREMIER TOBIN: Mr. Speaker, I thank the Leader of the

Opposition for his question. Indeed, the minister responsible for Human

Resources Development, the hon. Doug Young, issued a statement last week

suggesting that the Federal Government was prepared to take a flexible approach

to the issue of manpower training across the country, and that is, one presumes

by the statement made by the minister - we certainly did not have an advance

copy of it - that for those provinces that want to take up a greater share of

the $2 billion in the unemployment insurance fund set aside for training uses,

to administer those programs more directly, there would be an opportunity for a

transfer of those funds for administration by the provinces. At the same time,

for those provinces that believe that the Federal Government is better able to

delivery those programs, and should continue to deliver those programs, existing

arrangements would be maintained.

Mr. Speaker, I think most provincial governments have

responded positively initially to the statement. Obviously, we all want to have

an opportunity to examine it in detail. We all want to ensure that the dollars

which are currently being spent from the account for this purpose continue to be

spent, and that if there are going to be efficiencies in the administration of

dollars between governments, there must also be some clear and constructive

benefit for those people who require manpower training.

So, Mr. Speaker, I cannot say more than that today except to

say that we respond positively to what we have heard. We want to explore it in

detail, and indeed, we are awaiting the analysis of the minister and the

minister's department.

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

supplementary.

MR. SULLIVAN: Thank you, Mr. Speaker.

Mr. Young did not refer to a flexible program; he referred to

flexible federalism - in other words, the devolution of powers in the labour

market training to the provinces, that is where he used the term `flexible'.

Also, the program, I say to the Premier, was first announced

by the federal minister on November 27 and was released in reasonable detail on

December 1. I had a copy and went through various analyses of it and asked

questions of the Premier in this House before. It makes reference in this

release and the backgrounders that were made available last Thursday afternoon -

is it mandatory, I ask the Premier, that the provinces enter into this

provide those services to Newfoundland and Labrador?

MR. SPEAKER: The hon. the Premier.

PREMIER TOBIN: Well, Mr. Speaker, as I have said, we are

all awaiting more information on the initial statement that has been made by the

Minister of Human Resources Development. My understanding at this stage of the

announcement - which is why I cannot tell the Leader of the Opposition that we

will or will not sign an agreement, that we will or will not proceed down this

road until we have further information and have had a chance to have a

discussion or dialogue, which I haven't had yet, which the minister hasn't had

yet. I presume the Leader of the Opposition would want us to carefully assess

what is being put on the table before we come to any firm conclusions about it.

My understanding is that there is provision in the way in

which the Federal Government is offering to run this program in the future, and

this is why I made the reference to, not flexible federalism only, but to a

flexible program. There is provision that for those provinces, a good example

being the Province of Quebec, that want to administer manpower training

themselves directly, that that would be possible out of Quebec's share of this

$2 billion fund. For those provinces that may decide the Federal Government

should continue to administer this program itself, versus having the

responsibility transferred to the provinces, that that would also be possible.

That is why people have referred to this program as a good example, if it works,

of flexible federalism.

I would remind the Leader of the Opposition - something I am

sure he knows - that the funds in question are one hundred per cent contributed

by employees and by employers. This is not a fund out of the Consolidated

Revenue Fund of the Federal Government. It is not a fund that comes from the

Department of Human Resources Development, but rather, it is a fund set aside

within the EI envelope, contributed by those who work and by employers, and what

the Federal Government is saying is: How should we use this money? How does it

best fit your Strategic Economic Plan in your province? And we are prepared to

be flexible enough to administer the program in a way that best suits the needs

of any given individual province. It seems to me that, on the surface, that is a

pretty fair approach, providing the details -

MR. SPEAKER: Order, please!

I ask the Premier to finish his answer.

PREMIER TOBIN: - substantiate what is being offered.

MR. SULLIVAN: A supplementary, Mr. Speaker.

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

supplementary.

MR. SULLIVAN: Thank you, Mr. Speaker.

I still don't know from the Premier the answer to my

question: Is it mandatory? Do we have to buy into the three-year program? And,

Province? That is all I am asking.

MR. SPEAKER: The hon. the Premier.

PREMIER TOBIN: Mr. Speaker, I don't believe the program

is mandatory, and secondly, I believe the Federal Government is indicating in

its approach that for those provinces that don't want to totally repatriate

manpower training, they will continue to provide manpower training services out

of that fund. That is my understanding based on a statement of only a few days

ago. I said to the Leader of the Opposition at the very beginning that we still

have not had an analysis from the minister or from the minister's department. I

would suggest that what the minister and her officials will want to do, is to

arrange meetings to explore all of these questions in great detail to be able to

give a reassurance to the Leader of the Opposition and to all the people of this

Province that the program is in our best interest. If the Leader of the

Opposition is asking me, and I know he is not, to make a snap judgement and to

say today, cast in stone, we will do this and we won't do that, the Leader of

the Opposition would be the first to stand and criticize us for taking such an

approach, and of course, we would not do that.

MR. SPEAKER: A supplementary, the hon. the Leader of the

Opposition.

MR. SULLIVAN: Thank you, Mr. Speaker.

No, I certainly don't say that to the Premier. I have seen

too many of those already, Premier, I want more input into the decision-making.

Has the Premier and his government - since this was announced

over six months ago, has been ongoing and provinces are ready to begin on July

1, some have indicated positively already, the Premier has said, and our

Province has not, as yet, assessed it while other provinces are ready to say

yes. I ask the Premier: Have you looked at what we were receiving in the past in

comparison to what this new three-year program is going to offer? I find it hard

to believe that we do not know - a federal program was announced and days later

we don't have any details. So could you provide that to us, Premier?

MR. SPEAKER: The hon. the Premier.

PREMIER TOBIN: Mr. Speaker, with respect to the Leader of

the Opposition, the announcement by Minister Young was only a few days ago, as

you know. There was a public statement in the House of Commons last week, last

Thursday - this is Monday - and I think it is quite reasonable that we would

give the minister and the department here in Newfoundland and Labrador a few

days to assess the program and then to give the Leader of the Opposition's

questions the informed response that they deserve. That is why the Minister of

Industry, Trade and Technology has taken the questions under advisement, it is

why I take them under advisement and, in an appropriate time, I am sure we will

have a full Ministerial Statement by the appropriate minister, responding to

this offer by the Federal Government and, at the same time, taking note of the

questions you have raised and responding to those in detail as well.

MR. SPEAKER: A supplementary, the hon. the Leader of the

Opposition.

MR. SULLIVAN: Thank you, Mr. Speaker. A particular

concern I have is that recently the Federal Government has moved, under the

Canada Health and Social Transfer, from a needs basis into and towards a

population-based payment to this Province.

Under this new proposal, I ask the Premier: Is this a new

proposal by the Province, and will he ensure, if it is not, that he will address

the needs of this Province and not be given to us on a per capital basis?

MR. SPEAKER: The hon. the Premier.

PREMIER TOBIN: Well, Mr. Speaker, the Leader of the

Opposition is on the one hand asking us to be very careful what we do, asking

whether we have to sign an agreement, asking whether we have signed it yet,

asking whether we are going to examine all of the issues before we sign, and

these are all good questions, but they all deserve good, informed answers. Given

that we have only had a statement Thursday afternoon past in the House of

Commons, given that the minister responsible is in her constituency today doing

other important public work, I think we should give the minister and the

department a day or two, and then would be quite happy to come and respond to

each of these questions being raised by the Leader of the Opposition.

That is the job of government, to examine these questions, to

prepare positions that reflect the best interests of the Province, and then on

an appropriate occasion to respond accordingly in the House and elsewhere in the

public to the questions that are being raised.

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

supplementary.

MR. SULLIVAN: Thank you, Mr. Speaker.

It states here that agreements will be entered into after

July 1 with all provinces; they will stay into effect as long as the desired

and the Province and Territories will agree on the results to be achieved, and

the process for evaluating them.

Has the Premier given consideration and reached a bench mark

on what they consider to be desired results for this Province, seeing July 1 is

the potential date that we could put this into place?

MR. SPEAKER: The hon. the Premier.

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

in asking the question and referring to the document he has referred to, has

answered his own question. Agreements will be entered into after a certain date.

MR. SULLIVAN: (Inaudible) answer.

PREMIER TOBIN: Well, listen to what you have just said;

agreements will be agreed to by the federal government and the provinces, so

nothing unilaterally is being imposed upon the Province. The agreements will

stay in place as long as the agreed desired results are being achieved. It seems

to me it is pretty clear, then, that once the minister comes forward and sets

out the objectives that we are pretty well covered, and we should give the

minister a day or two to do her job.

I understand the Leader of the Opposition's anxiety, but even

the Leader of the Opposition, I know - because I know he is a reasonable man -

will agree we ought to give a day or two to the minister to come and give a

response in the House and to respond to these questions. Perhaps he might put

them again in a week or so and get a more detailed response.

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

final supplementary.

MR. SULLIVAN: Thank you, Mr. Speaker.

I am a little appalled that there is no planning and

discussion days after the minister has announced programs with provinces.

I ask the Premier: Will the Premier confirm that a special UI

program for fishers is about ready to be announced; it is under development and

there have been extensive discussions? I understand this Province has been

briefed. I ask him: What input did the Premier have in addressing our Province's

major concerns when those issues were discussed?

MR. SPEAKER: The hon. the Premier.

PREMIER TOBIN: No, Mr. Speaker, I cannot confirm that. I

can tell him, as the Minister of Intergovernmental Affairs and the Premier of

the Province, nobody has given me a briefing on a special program. If the Leader

of the Opposition knows about it, he might brief the House.

MR. SPEAKER: The hon. the Member for Bonavista South.

MR. FITZGERALD: Thank you, Mr. Speaker.

I have a question for the Minister of Development and Rural

Renewal, so maybe in her absence I might direct it to the Premier.

The federal government admitted its liability for mismanaging

the fisheries and for enforcing the groundfish moratorium by qualifying 27,959

Newfoundlanders for compensation under the TAGS program. Ottawa's liability, I

say to the Premier, has not ended, and up until now the moratorium has not

ended. Can the Premier tell us how many of the 27,959 eligible Newfoundlanders

are actually drawing TAGS benefits, since I am sure the government is monitoring

this number on a frequent basis now that thousands are being kicked off this

particular program?

MR. SPEAKER: The hon. the Premier.

PREMIER TOBIN: Mr. Speaker, the question that is of

concern to the Government of Newfoundland and Labrador is the fact that the

federal government, in recent days and weeks, has been examining the TAGS

program, and has been examining what has been estimated to be anywhere between a

$300 million and a $500 million cost overrun on the program; and the numbers

vary depending on who seems to be talking on the federal end.

The real issue that concerns the people of Newfoundland and

Labrador - and I would suggest to the member that I suspect he might agree -

that concerns fishermen and plant workers who are eligible for the program, is

whether or not as part of the cost consolidation and the savings that the

federal government wants to achieve, whether or not there is going to be a

reduction on the income levels paid to plant workers and paid to fishermen?

Indeed there was a report in the telegram over the weekend. A

reporter called me and asked me to comment on information that the telegram had

acquired, that there may be a roll-back in incomes by as much as 6 per cent in

July and a further 6 per cent, according to the report, in January. Now the

position of the Government of Newfoundland and Labrador on this question is

clear and indeed it was certainly the position, and I suspect still is the

position, of all the federal MPs in Ottawa, and that is that rolling back the

wages of plant workers or fishermen on the program, for as long as they remain

on the program, is absolutely unacceptable. We have said as a government in the

past, the members of this House generally have said, that if efficiencies must

be found by consolidating administration, sobeit. If efficiencies must be found

by rolling back some of the training programs associated with TAGS, sobeit.

Indeed the fishermen's union itself has supported that measure in the past, but

it is not acceptable - and we say this clearly and unequivocally - and the

Provincial Government of Newfoundland and Labrador will not support any decision

by the federal government to roll back the income levels of plant workers and of

fishermen.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The hon. the Member for Bonavista South on a

supplementary.

MR. FITZGERALD: Thank you, Mr. Premier.

I still say that you should have taken just as strong a stand

a few months ago when they already took 6 per cent from them and tried to take

two weeks pay from them as well; when you were the minister, I say.

PREMIER TOBIN: They didn't take it off.

MR. FITZGERALD: They rolled it back 6 per cent, I say to

the Premier. They rolled back 6 per cent from the NCARP program to the TAGS

program.

Won't the Premier admit the reason that there are cost

overruns is that the program was underfunded from the very beginning? Will he

pressure his federal counterparts to find this money without taking it out of

the pockets of fishermen and fish plant workers that are going through severe

hardship in this Province today?

MR. SPEAKER: The hon. the Premier.

PREMIER TOBIN: Well, Mr. Speaker, it is delightful to

have the member ask me to do something which I have just announced, on behalf of

the people of Newfoundland and Labrador, that we are already attempting to do,

which is to stop any roll-back in the income levels of fishermen or people on

TAGS.

Now the member doesn't want, I know, to be partisan about

this and it is not his intent. His only intent in rising is of course to

represent the interests of fishermen and plant workers because he would not want

to be partisan. If the member were being partisan it would force me to ask him

where he was when the former Conservative government would not give any

commitment to continue any program past NCARP, and it took the election of a

Liberal government to bring in a five-year income support program called TAGS!

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The hon. the Member for Bonavista South on a

supplementary.

MR. FITZGERALD: Thank you, Mr. Speaker.

I remind the Premier that he was in office for quite some

time and had lots of time to implement a much better program than he had already

put in place known as the TAGS program.

Coupled with UI cuts, federal job cuts, transfer cuts, these

deeper TAGS cuts would devastate the Newfoundland economy, I say to the Premier.

Can the Premier give us some figures to tell us the implications of the cuts in

TAGS for this Province's economy during this already difficult year?

MR. SPEAKER: The hon. the Premier.

PREMIER TOBIN: Now, Mr. Speaker, I cannot give you some

figures to tell you what the impacts of a cut will be unless we know what the

cut is. I have certainly told you the position of the Province of Newfoundland

and Labrador, that there should not be any roll-back on the income of plant

workers and of fishermen.

Now a little while ago the member asked, `Isn't the reason

the program is in difficulty that it was underfunded in the first place?' What

the member should know is that when the program was announced it was announced

as a $1.9 billion program and on top of that another $100 million in total was

set aside for economic development over and above the TAGS funding. Of course

that is the fund which is now available for the Province of Newfoundland and

Labrador to use in diversifying its economy in a number of ways which of course

are fully supported by the Leader of the Opposition and his party opposite.

In answer to the question: Why has the cost gone up? The

simple reason the cost has gone up is that additional fisheries across Atlantic

Canada, including Newfoundland, have closed. The real question for the Minister

of Fisheries is - and this is the dilemma for the Minister of Fisheries today,

it was the dilemma when I was the Minister of Fisheries. When you have evidence

that a stock is in trouble, a fisheries stock, do you say I am not going to

close that stock, I am not going to close down that fishery and put more

fishermen and more plant workers out of a job because the consequence of doing

that is to put more people on TAGS, therefore to cause a cost overrun on the

TAGS program?

What is more important to the Minister of Fisheries and

Oceans, and more importantly, what is more important to Canada, maintaining the

integrity of the budget of the TAGS program or maintaining the integrity of the

conservation program of the Minister of Fisheries and Oceans? I say, the right

thing to do, when you have to, in terms of the long-term health of the fishery,

is to close additional fisheries and the consequences budget-wise, will have to

be dealt with later. That is why the national government should maintain these

incomes for fishermen and plant workers, because the cost overrun is not their

fault.

MR. SPEAKER: Order, please!

The hon. the Member for Signal Hill-Quidi Vidi.

MR. HARRIS: Thank you, Mr. Speaker.

My question is for the Premier and it relates to a couple of

job offerings that were posted in The Evening Telegram last week, one for

Director of Policy and Planning for Labrador and another, a Regional Manager for

the Labrador Region.

I want to ask the Premier: Why is it that these jobs are not

being selected and hired through the Public Service Commission? Is there some

other relative of the Premier who has yet to get a senior position in the

government? Why is the government not using the Public Service Commission with

thirty-five employees designed to look after hiring on the merit principle in

relation to these jobs?

MR. SPEAKER: The hon. the Premier.

PREMIER TOBIN: Mr. Speaker, I have no idea what the

Leader of the NDP is talking about. I could only offer to take it under

advisement. Perhaps if he could take some time from his full-time job as a

lawyer, acting on behalf of certain clients who are suing the Province, then he

would have more time to write me and give me advance notice of the questions.

SOME HON. MEMBERS: Hear, hear!

MR. HARRIS: Mr. Speaker, this appears that Saturday's

paper, Mr. Speaker -

MR. SPEAKER: Order, please!

The hon. the Member for Signal Hill-Quidi Vidi, on a

supplementary.

MR. HARRIS: Thank you, Mr. Speaker.

The Public Service Commission is legislation designed to hire

on the merit principle, which idea is to promote and hire free from political,

bureaucratic and personal patronage. I wonder while the Premier is checking into

this position, which he knows nothing about apparently, could he tell us why the

Public Service Commission is only involved indirectly in the selection process

for approximately one-twelfth of the positions; for example, in this 1994 Annual

Report, fifty-one positions out of over 600?

Could the Premier tell us why the Public Service Commission

with its thirty-five employees is not being used for the hiring and in

particular, why it is not being used for hiring for these two positions for

government work in Labrador?

MR. SPEAKER: The hon. the Premier.

PREMIER TOBIN: Mr. Speaker, I want to assure the Leader

of the NDP that when I go back upstairs to my office, I am going to ask my

acting Chief of Staff, Phonse Faour, exactly what is going on and whether or not

we are making sure these jobs are being filled in the proper fashion.

MR. SPEAKER: The hon. the Member for Cape St. Francis.

MR. J. BYRNE: Thank you, Mr. Speaker.

Mr. Speaker, my question is for the Minister of Government

Services and Lands.

Mr. Speaker, we know that 1,200 applications for Crown lands

are processed each year by the Lands Division. Could the minister inform the

House of the number of residential leases and the number of cottage leases in

the system, and the amount of revenue received per year by the department

through these leases?

MR. SPEAKER: The hon. the Minister of Government Services

and Lands.

MR. McLEAN: Mr. Speaker, for me to supply that kind of an

answer right now, I would have to get my officials to determine how many cottage

leases, how many residential leases are issued each year and what the general

revenue is. I would certainly take those questions under advisement and have

them for the hon. member tomorrow.

MR. SPEAKER: The hon. the Member for Cape St. Francis, on

a supplementary.

MR. J. BYRNE: Thank you, Mr. Speaker.

Mr. Minister, this question has been asked of me by numerous

people and they need an answer to it.

If a person makes application under the new policy by October

31, 1996 and finds that he cannot afford to convert to a grant and cannot afford

the newly increased lease fee, what is government's policy to deal with this

situation, and will we see evictions or confiscations?

MR. SPEAKER: The hon. the Minister of Government Services

and Lands.

MR. McLEAN: Mr. Speaker, we are in the process right now

of corresponding with all leaseholders in the Province. At the time when we

receive correspondence from these people we will be in a better position to

determine what might happen. We feel that most of these people will comply with

the policy without any trouble.

MR. SPEAKER: The hon. the Member for Cape St. Francis, on

a supplementary.

MR. J. BYRNE: Thank you, Mr. Speaker.

So, Mr. Minister, you are saying there is no policy in place,

no plan in place. Once the majority, if not all leases are converted to grants,

will we see property tax on these properties to make up for the lost yearly

revenues?

MR. SPEAKER: The hon. the Minister of Government Services

and Lands.

MR. McLEAN: Mr. Speaker, I do not exactly know what the

hon. member is referring to, whether it is cabin lots or whether it is

residential lots. Residential lots in many communities right now are under

property assessment. The cabin lots in a very few areas are under market value.

MR. SPEAKER: The hon. the Member for Cape St. Francis, on

a final supplementary.

MR. J. BYRNE: What I am asking the minister is with

respect to cottage lots in the Province. We will now see these lots, or most of

them, converted to grants. Once they are converted to grants, the Province will

not have revenue coming into the Province because the yearly lease will not be

there anymore. Will we see property tax in place to offset the lost yearly

revenues for leases?

MR. SPEAKER: The hon. the Minister of Government Services

and Lands.

MR. McLEAN: Mr. Speaker, the leaseholders right now pay

$75 a year for the lease itself and it is costing government well over $300 to

administer this particular program, so we will have, in the end, by transferring

all of these to grants, far more revenue and we will not need as much revenue

because we are not administering the 22,000 leaseholds.

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

MR. OTTENHEIMER: Thank you, Mr. Speaker.

My question this afternoon is for the Minister of Justice and

the Attorney General. Is the Minister of Justice and the Attorney General for

this Province concerned about the principles of equity and fairness regarding

these proposed huge hikes in Crown land leases for recreational cottages and the

effect these hikes will have on our citizens?

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

MR. DECKER: Mr. Speaker, I remind the hon. member that I

am a member of this government and when this government makes a policy I have

two choices, either to accept that or resign. I have not given my resignation to

the Premier, nor do I intend to.

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

a supplementary.

MR. OTTENHEIMER: Thank you, Mr. Speaker.

My question is again for the Minister of Justice and Attorney

General. The people of this Province have signed in good faith leases for

recreational cottages for a term of fifty years at a yearly rate of $75 a year.

It is true that a provision of this lease is that the rent reserved, as set out

in the lease, shall be subject to review each and every five years. The last

rental increase occurred approximately fifteen years ago and at that time the

increase was from $50.00 to $75.00.

I ask the minister, as the Minister of Justice for this

Province: Does he not find this increase from $75 to some $500 both

unconscionable and unacceptable during these very difficult times?

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

MR. DECKER: Mr. Speaker, I suppose if it went back to the

turn of the century you would find that there was again a different rate for

leasing land and property. Policies change from time to time. I am not aware

that we are doing an injustice to any agreements that are in place, and I would

certainly assume that before government took the decision to increase that there

would have been discussions with the Department of Justice to ensure that was

being done is perfectly legal, and I have no reason to agree that it is not

legal.

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

a supplementary.

MR. OTTENHEIMER: Mr. Speaker, would the minister not

agree that if people could afford to own their property outright they would do

so at the existing relatively low annual rental for these recreational lots

which is within the means of thousands of Newfoundlanders? Does the minister not

view what is happening at this time as a breach of contract in that persons who

in good faith opted to lease land at relatively low annual rates are now being

forced to purchase the freehold interest at significant cost, and for which many

people in this Province, that cost is well beyond their means?

MR. SPEAKER: The hon. the Premier.

PREMIER TOBIN: Mr. Speaker, I want to take this

opportunity to respond to the member's questions, because one of the realities

of making a Budget is that a Budget is about taking choices, and when the

government has a deficit to deal with of nearly $300 million, there is no

scenario - and the Leader of the Opposition knows this - there is no scenario

under which you cannot make some choices to reduce some of the expenditures of

government and, where it is appropriate, try to bring in some additional

revenues.

Mr. Speaker, I say to my colleagues opposite in this House,

it is not enough to single out each of the areas where Budget impacts are felt,

and to stand in the House and make the case why the adjustment in question

should not be made, unless members opposite are also prepared, in fairness, to

put forward their plan. None of us can have it both ways.

If we say - and, as members opposite have said; the Leader of

the Opposition has said this on behalf of the Conservative Party - that you

would move to a balanced Budget within a few years, at some point you must begin

to lay out where your priorities are. We have held the line on health care

expenditure in this Province; it wasn't without pain to do so.

MR. SPEAKER: Order, please!

PREMIER TOBIN: We have held the line on expenditures for

the poorest amongst us, those on social services. It wasn't easy to do so.

MR. SPEAKER: Order, please!

PREMIER TOBIN: We have brought in a Budget with no tax

increases for ordinary people of Newfoundland and Labrador. It wasn't easy to do

so. We made our choices, and I ask: What choices would you have made in the same

circumstances?

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The time for Oral Questions has elapsed.

Notices of Motion

MR. SPEAKER: The hon. the Member for Cape St. Francis.

MR. J. BYRNE: Thank you, Mr. Speaker.

Mr. Speaker, I give notice that I will on tomorrow ask leave

to introduce the following private member's resolution:

WHEREAS the new Crown land rates are so great they will

deprive many people of the opportunity to have a cabin or cottage; and

WHEREAS unemployed, underemployed, pensioners, low-income

earners, and other hurting Newfoundlanders having long enjoyed the freedom to

have a cabin or cottage in the great outdoors, and will be denied this freedom

under the new policy; and

WHEREAS many cabin owners who have invested a great deal of

time and manual labour in cleaning up the land based on a traditional and

historical low accessible rate for Crown land; and

WHEREAS this money grab is no less than an attack on our

traditional way of life; and

WHEREAS there has been no public consultation on this new

policy, even though the government has promised to consult with and listen to

people before making decisions;

THEREFORE

BE IT RESOLVED that this hon. House request the

Government of Newfoundland and Labrador to delay implementation of this new

policy, call public hearings, and only then implement policies according to

presentations made and in line with Newfoundlanders' and Labradorians'

traditional access to Crown land.

Thank you, Mr. Speaker.

SOME HON. MEMBERS: Hear, hear!

Petitions

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

MR. OSBORNE: Thank you, Mr. Speaker.

I stand in the House today, on the very day we have been told

by the Premier that there have been no tax increases that affect the average

people in Newfoundland. He seems to forget the ambulance fee increases, the

changes to Crown lands, the cuts in education, the discontinuation of school

buses. My petition is on behalf of the residents of Newfoundland and Labrador,

to voice their opposition to the change in Crown land fees.

Thank you, Mr. Speaker.

MR. SPEAKER: The hon. the Member for Cape St. Francis.

MR. J. BYRNE: Thank you, Mr. Speaker.

Mr. Speaker, I wish to support the petition presented by the

Member for St. John's South. Of course, since this new policy was announced in

early May, there has been nothing but total confusion with respect to this

policy. I have asked questions in this House to try to clarify the situation.

The minister has been forthcoming with some answers, but again, I don't believe

they are quite clear. The people of the Province are quite concerned with these

large, dramatic increases in their yearly fees. There are going to be a number

of people - I firmly believe this, by the way - that there will be a number of

people in this Province who do have cabin lots, who scrimped and saved over the

years, probably built their cabins over a period of two, three, four or five

years and saved every penny they could to put it there, because the only form of

recreation they could have, Mr. Speaker, was to go out to their cabins; mostly

in the summer time. Mr. Speaker, we do have cabins in the Province that are

utilized over the winter months but mostly, I think, people utilize their cabins

in the Province over the summer months. Again, cabin owners in the Province need

to be consulted on this new policy before it is implemented, and that is the

reason why today I gave notice today of a Private Members Resolution to be

discussed, hopefully on Wednesday, in this House.

I remember during the election that this government said they

would consult with the people before they made any major policy decisions. The

Minister of Finance and Treasury Board went around this Province, after the

election, to try and get some input to the Budget. He did have some public

meetings around the Province, Mr. Speaker, but the people would not really

listen to him. There was a firm commitment that this government would consult

with the people. This policy change, Mr. Speaker, is a major change in direction

for Crown lands in this Province. It is a major, major change in direction and

the people I believe, need to be consulted; going from $75 a year, Mr. Speaker,

to $500 a year in some cases, $600 a year in other cases and maybe upwards of

$2,000 and/or more depending on the process.

We are not quite sure yet, Mr. Speaker, what the process is

going to be, especially with respect to properties that are to be assessed. The

minister stated that properties that have been assessed within municipalities in

the Province, that money would be based on 20 per cent of the assessed value of

properties within municipalities. For example, for a residential lease or a

cottage lease within a municipality, a person who has a summer cabin within the

boundaries of a municipality could actually pay much, much more per year than a

person who has a cabin in an area that is not within the boundaries of a

municipality.

The minister has stated in this House, that the assessors

from the Department of Municipal and Provincial Affairs will be doing

assessments. The Minister of Municipal and Provincial Affairs has stated that

the assessors at the Department of Municipal and Provincial Affairs will not be

doing assessments. That in itself is a confusion there, Mr. Speaker.

Again, as I said earlier, I stand to support the petition of

the Member for St. John's South.

Actually, I have announced today, that we will be having a

public meeting at the Holiday Inn on Wednesday of this week, at 7:30 in the

evening, a public meeting for people to come forward, to make presentations, to

show their concerns and to come up possibly with some resolutions that could be

presented to the minister to try and offset this drastic increase of fees to the

public of the Province.

With that, I am sure there will be a lot more forthcoming in

this House in the very near future.

Thank you.

MR. SPEAKER: The hon. the Member for Bonavista South, on

a petition.

MR. FITZGERALD: Thank you, Mr. Speaker.

I rise today to present a petition to the House of Assembly,

a petition similar to what have been brought forward here on a daily basis in

the past and it reads:

A petition to the hon. House of Assembly of Newfoundland in

Legislative session convened, the petition of the undersigned residents of

Newfoundland and Labrador, that:

WHEREAS Newfoundland Power has asked the Public Utilities

Board to approve an increase in electricity rates; and

WHEREAS Newfoundland Power having made some $27.8 million in

profit last year is not in need of extra revenue from consumers; and

WHEREAS Newfoundlanders suffering from the fish resource

crisis, general economic downturn and deep government spending cuts, can ill

afford increases in essential commodities like electricity at this time; and

WHEREAS not having had a rate increase since 1992 is no

justification for a rate increase in 1996

WHEREFORE your petitioners humbly pray that your hon. House

may be pleased to request the Government of Newfoundland and Labrador do

whatever is required to prevent an increase in Newfoundland Power electricity

rates.

Mr. Speaker, a prime example of the concern of people out in

rural Newfoundland and Labrador, when they express their thoughts by putting

their names on a petition, is the fact that Newfoundland Power recently applied

for a 4.9 per cent increase in electricity rates, coupled with the cost, Mr.

Speaker, that will be incurred and will be shown on your hydro bill when you see

the harmonization of the PST and the GST, taking that into consideration, which

is another 8 per cent, Mr. Speaker, it won't be uncommon to see a 13 per cent or

14 per cent hike in electricity rates in Newfoundland and Labrador.

This particular utility is providing a commodity on which it

has a monopoly. You don't have the luxury of saying: because you are raising

your rates then we will go and purchase our electricity from some other company.

We don't have that option, Mr. Speaker; we have no other choice. If we burn

electricity here today then we have to go to Newfoundland Power, or if they are

not in the business then we have to go to other areas, if we live in other areas

of the Province, where Newfoundland and Labrador Hydro provides that particular

service.

One of the arguments that they put forward is that, we have

not had a rate increase since 1992. Well, I can tell you of lots of people who

have not seen an increase in their pay cheque for much, much longer than that.

Mr. Speaker, when you look at providing the service here to home owners and to

industrial users in Newfoundland and Labrador you will find that not only do we

have to pay for the electricity that we consume but we also have to be

responsible for the provision of that particular service as well.

It was only a few years ago that this particular utility had

work crews or employees in just about all the populated areas of the Province,

and if you had a problem it was only a matter of picking up the phone and

calling them; and they gave excellent, excellent service. In the last couple of

years, Mr. Speaker, we have seen that service deteriorate. I know in the area

where I live, Mr. Speaker, we at one time had two Newfoundland Power employees

stationed in our community and if there was problem, if there was a fire, those

people were always the first people to be on the scene to disconnect your meter

base or to go up on the pole and disconnect the electricity going to that

particular household. Today, Mr. Speaker, those same people have to access the

employees in Clarenville and if you call in with a problem with your street

lights, until there are a number of them that have been extinguished or they

have had problems with, that they can justify driving from Clarenville to a

particular area - in order to justify going there, then you have to have a

couple of hours work for them. They have to make it worthwhile, I suppose.

Now when the bill comes you don't get any credit for that

particular light being out for six days this month or ten days some other month.

There is no decrease in the rates that you pay. The only thing is that you had

to do without the service. You have the same utility company making $28 million

a year in profits coming back down and saying that we need another 4.9 per cent

in electricity rates. If you turn on your television, if you look at the glossy

ads that you see in the papers and you look at the catchy ads on television, who

is paying for it? It is certainly not Newfoundland Power, it is the electricity

users in this Province today.

MR. SPEAKER: Order, please!

The hon. member's time is up.

MR. FITZGERALD: So, Mr. Speaker, with my time being

expired I call on government to listen to the residents of Newfoundland and

Labrador and make representation on their behalf.

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

MR. H. HODDER: Thank you very much, Mr. Speaker.

I rise today to again support the petition offered by my

colleague on the application by Newfoundland Power for a rate increase.

Now, Mr. Speaker, I was very pleased this afternoon as I

listened in the House and heard the Premier say that he was against the 6 per

cent roll back for recipients on the TAGS program. I thought to myself: this is

very, very good. The Premier of this Province is standing up for the people in

this Province who have fallen through the economic net. So therefore I was

delighted to hear that.

However, I don't take much comfort in the fact that that

decision is relative to a program that is being funded through his friends in

Ottawa, but when we look at Newfoundland we don't see the same Premier standing

up and having a position on the application by Newfoundland Power or I don't see

the same kind of philosophy prevailing when it comes to the rate increases for

people who have need to access ambulance services.

So, Mr. Speaker, the Premier is an advocate when it comes to

policies that are coming from Ottawa but he is not taking the same position when

it comes to those things which he is able to control. When it comes to the

things he can control we see the Premier nibbling away at the poorest people in

the Province, those people who can ill afford the extra expenditures that we are

talking about when it comes to denying the children of St. John's access to

school busing. As we know, this is going to cause great hardship on the very

poorest of the people in our society.

In the same way, we don't know the position of government

relative to Newfoundland Power. We know that the government have appointed an

advocate but we do not know what the government's position is. We do no know

what government's response is when it comes to Newfoundland Power. While I say

to the government, we applaud their position in talking to their friends in

Ottawa for those people who are TAGS, we want to know what their position is

relative to our very own people of Newfoundland on an essential commodity, the

access to power which, of course, is under the Newfoundland government

legislation.

We know that Newfoundland Power had great profits last year.

We know that the poorest people in the Province have to balance their budgets

over a year-long program so they pay the same amount each month. We know that

people who are on social assistance cannot find the money to be able to keep

their children warm in the Wintertime. We know they have to economize every way

they can. So what the people are saying in the petitions we have presented is,

would you hear what we are talking about? Would you care to listen to what we

are saying?

Mr. Speaker, we know that we presented many petitions. I can

tell the hon. House there is a petition on the way now that has over 50,000

signatures on it. It is not here yet but it is on it's way, and if that is not a

substantial part of the Newfoundland population I would like to know what is.

This is a very great concern for the residents of Newfoundland and Labrador.

They are saying to the government: Would you please stand up for us, stand up

for the ordinary citizen who is finding it difficult enough now to pay the cost

of electricity? How are they going to be able to pay the extra cost if

Newfoundland Power is given the approval to increase its rates?

Mr. Speaker, we are talking about consultation, we are

talking about hearing voices, we are talking about the ordinary person, we are

talking about those who live without adequate means all the time. We are saying,

listen to what people are saying and hear their voices because not to do so, I

think, would be a tragedy for our democratic system, not to say anything about

the personal hardship it will cause their families, individually and

collectively.

Thank you very much.

MR. SPEAKER: The hon. the Member for Baie Verte.

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

I rise today to present a petition on behalf of the known

fighting Newfoundlanders again. The good news and bad news I say to the House

Leader: The good news is that this is the last of the petitions of the first

lot, but the bad news is that there are other lots coming.

SOME HON. MEMBERS: Hear, hear!

MR. SHELLEY: As a matter of fact, Mr. Speaker, this

weekend a constituent from Bonavista North asked me, although we do hear members

saying that people do not hear you with your petitions and so on - that may be

true but somebody is getting the word somewhere because a constituent from

Bonavista North asked if he could organize a petition and if I would present it

on his behalf. I said: You can ask your member. He said: I don't think my member

would support me, so would you present a petition? I said: I would be glad to.

After that, Mr. Speaker, I started to get a few calls, on Thursday and Friday of

last week, from other communities.

Now, this particular group known as the Fightin' Nfld'ers

will be presenting a humongous size petition, 40,000 or 50,000 names, to the

federal Minister of Fisheries in the next little while, I think some time this

month. Aside from the Fightin' Nfld'ers group there are also individual groups

from all districts. I say to members opposite, I cannot say every single

district I talked with, but many of the districts are organizing their own

petition just to have a say on this particular issue.

I know a lot of members try to blow it off as not being

really important or it is not the most crucial, Mr. Speaker, but the bottom-line

is there are a lot of people in Newfoundland and Labrador, especially in rural

Newfoundland I say to members, who believe that this Summer they should be

allowed to go out and jig a fish to eat. That is a simple, simple line, Mr.

Speaker. They do not want to make a mountain of a molehill. They do not want to

talk about a big issue like when the House Leader got up the other day and

talked about John Crosbie and all the mistakes he made, all the mistakes the

federal government made over the years, and the big bycatches and biomass

problems. They are not talking about that, they are talking about a small food

fishery, 1000 tons, maybe 1500 tons. That is all they are talking about.

They are not talking about how the Minister of Fisheries gets

up and says: Oh, are you going to open up the commercial food fishery, now? No,

they are not talking about that. We are talking about places like Round Harbour,

Fleur de Lys, Fogo and all of those that say: I should be able to go down and

catch ten fish.

It was just last week, Mr. Speaker, that two more people in

my district were caught with nine or ten fish in their boat, were fined again, a

$2,000 fine, lost their boat and so on; and they won't give up on it. It's not

that we condone anybody breaking laws, but I can certainly understand why they

are so frustrated.

MR. GRIMES: (Inaudible).

MR. SHELLEY: No, it is new every day. I say to the

Minister of Education, it is new every day. There are so many different angles

on it, and there are so many people telling me different things, that I can say

it every day, I say to the Minister of Education.

Mr. Speaker, I have told people that if they send petitions I

will present them so, of course, I will continue to present them. I say that to

the minister also. If he wants to call this one to order I will read out the

whole thing for him again, but I don't think I need to do that.

As a matter of fact, that relates to the point I am trying to

make at this particular time today as I present this petition. Let's not make a

mountain out of a mole hill. The Minister of Fisheries gets up and says: Oh,

you're not supporting opening a commercial fishery; no, I am not. I don't think

anybody here is. There is not one person's name on this petition that supports

that. We are talking about the average Newfoundlander who wants to go out and

jig a measly ten fish to eat, and it is not going to hurt the bloody stocks;

that is what everybody keeps talking about. We are talking about biomass, we are

talking about fish inland in the bays. The scientists in Ottawa don't know what

I am talking about either, but a fisherman in Newfoundland does.

He says: Paul, really what bay stock is is just a break off

of the major stock out there, and they go into the different bays and inlets.

They are not talking about going out in a long-liner with a dragger to get their

ten fish, or putting out a net. They are talking about going out in a dory,

rowing out, or with a tank of gas and an outboard motor, going out with a hand

line with a bit of bait on it to jig a fish; and everybody keeps going on about

the big history of the biomass problem and so on. Don't make a big issue of it.

I don't want the Premier to make a big issue of it, or the Minister of

Fisheries, or the federal Minister of Fisheries. Make a simple issue of it. They

want to catch ten fish to eat, and they want to do it at the right time, and

they want to do it properly. The criteria is, as when the former Minister of

Fisheries, now the Premier, stood one day and said: We don't want to make a big

issue of it, of surveys and scientific research and so on. This does not even

need to be related to it.

Mr. Speaker, if that poor argument is there of somebody who

would say: Oh, we don't want to take the last fish out of the bay; is that what

you want us to do? No, if it is that bad, if we are going to lose our

conservation recovery because of a small food fishery, I would then say to the

Premier or the minister, that it is too late anyway; we are gone too far. If it

is that bad, we have missed it already.

MR. SPEAKER: Order, please!

The hon. member's time is up.

MR. SHELLEY: So I will continue to present these

petitions every single day, Mr. Speaker. Thank you.

MR. SPEAKER: The hon. the Member for Cape St. Francis.

MR. J. BYRNE: Thank you, Mr. Speaker.

Mr. Speaker, again today I rise in my place to support the

petition presented by the Member for Baie Verte. There have been a number of

petitions presented in this House with respect to the food fishery, and I am

sure there will be many more to come until we do get a food fishery.

There was a food fishery opened up, I believe it was two

years ago, and the food fishery at that time was being questioned by a lot of

people because I think it was put in place so that there would not be many fish

caught at that point in time, to make it appear that there weren't any fish in

the bays. Although, just the same, if you went out with a local fisherman in the

area who knew the berths you would probably get a few fish type of thing.

The question I have to ask is: Why is there no food fishery

in this Province at this point in time, Mr. Speaker, when there are fisheries

going on with respect to cod in other areas of this country, in Atlantic Canada

in particular? Why is there no food fishery?

I believe it basically boils down to public relations. If you

compare, or think about the number or the pounds of fish, and probably the tons

of fish, eaten each year by seals in our waters, and compare that to how much

fish will be taken by a food fishery for a couple of weeks at the right time of

year, there certainly would be no comparison whatsoever. So basically you have

to say: Why is there no food fishery?

The present Premier, the former Minister of Fisheries

federally, will try to make a case for basically the environmental aspect of it,

and conservation. To his credit, to a certain extent he became the great

terminator, the Tobin terminator type of thing, with respect to the Spanish

fleet off our coast last year with respect to the Estai , going out and

having the Estai arrested and brought into St. John's harbour by the

Coast Guard. I remember being down there and fully supportive of it, really not

knowing what was going to happen in the long haul.

In the long haul what actually happened was that boat was

basically towed into port and tied up. The people who were on that, the

fishermen or the operators of the vessel, were put in a hotel for x number of

days or what have you, and sent home. The fish was confiscated but given back to

the people of Spain. From what I can gather there were at least two cheques paid

out to send that fish back, a cheque for over $100,000 and another cheque for

over $40,000 to send the fish back that had been confiscated and the boat left -

from my memory now, Mr. Speaker, I could be corrected on this one - but the boat

left in the dark of night. So then -

AN HON. MEMBER: It was more like a cruise ship.

MR. J. BYRNE: Mr. Speaker, she left in the dark of night.

So now we have a situation of: what was the benefit of all of this publicity,

Mr. Speaker? Was it to get the present Premier back into this Province, to make

him the hero of the conservation of the fishery in this Province? Was that the

underlying reason to have the Estai arrested or was it actually the conservation

of the fishery itself? That is open to

interpretation. Anybody can answer that

question and they can look at the facts themselves, Mr. Speaker, and make that

determination.

Now, again as I said, the food fishery in this Province, I

think, should be reinstated. I mentioned here last week that an individual back

in pre-Confederation days made a statement that if we joined Canada that the day

would come when we would not be permitted to go out and jig a fish. Now, Mr.

Speaker, that was pretty thoughtful; a person had to have some foresight to see

that happening, and to say that it actually came true is pretty discouraging.

Mr. Speaker, the Member for Baie Verte has presented many

petitions on this issue and I am sure, as I said earlier, there will be very

many more to come. Hopefully we will see a food fishery in this Province, this

summer at the very latest.

Thank you, Mr. Speaker.

Orders of the Day

MR. SPEAKER: It is moved and seconded that this House

resolve itself into a Committee of the Whole on Supply and that I do now leave

the Chair.

On motion, that the House resolve itself into Committee of

the Whole on Supply, Mr. Speaker left the Chair.

CHAIR: Order No. 2, the hon. the Minister of Finance.

MR. DICKS: Thank you, Mr. Chairman.

Mr. Chairman, I don't have anything to say. I am just rising

for the purpose of introducing them. However, I would be delighted to answer any

questions which I think is probably a better way to proceed. So, unless the

members want me to say something by way of introduction, these are the general

estimates. Thank you, Mr. Chairman.

CHAIR: The hon. the Leader of the Opposition.

MR. SULLIVAN: Thank you, Mr. Chairman.

No, there is no need to say anything in an introduction. I

would just appreciate it if when I ask some of my many, many questions, in the

hundreds, hopefully I will have some answers. I say to the minister, I won't

make them too complicated. I guess with the Chair's permission too, it might

facilitate things, I say to the minister, if I ask a question and it is a yes or

no rather than keep recognizing different speakers. I can certainly give leave

within that time if that is suitable with the Chair and see how it is

progressing.

With reference to consolidated fund service - to make it a

little easier, I say to the minister, I was going to move along by section, each

particular point; that way I am sure the minister can answer questions. On page

5 in our Estimates, Treasury Bills, I would assume that is just because of a

lower need to have treasury bills in borrowing. That is why the interest is

down, a lower amount and probably lower interest, no extraordinary amount I

would assume.

MR. DICKS: No.

MR. SULLIVAN: Okay.

Canada Pension Plan, that is quite possible, with no

borrowing this past fiscal year really, as such, except to refinance any debt;

that is probably at reduced interest on the market today because of a decrease

in rates as opposed to last year?

MR. DICKS: Yes.

MR. SULLIVAN: It is roughly the same amount we have had

borrowed from the Canada Pension Plan I think, with a slight surplus this year

on our total debt. I will make some assumptions and if I am incorrect there I am

sure it might speed up things, the minister would certainly correct me. I am

quite sure he would do that. Interest earnings on the Province's available cash,

money markets and the bank, I would assume that situation also would be very

similar because last year we were into a situation where we had to borrow more

heavily, so, in other words, we would have more credits coming in this year,

more revenues in that area on our investments because we didn't need to be

extended as much as last year, that would probably be the reason, I say to the

minister in 1.1.06, Temporary Investments? We had a little bit improved cash

flow situation and we should have had a better return on our assessment, I would

assume, more money available.

Now, Recoveries on Loans and Advances, the next one, we

collected a significant increase there, we received from the previous year, why

do we call in loans - are loans to loan boards directly loans under government,

are they included in this, too, by calling in some government loans? Why would

we receive - and I am looking at 1.1.07. We are up from $6.1 million up to $7.9,

almost eight. We have there, about a 30 per cent increase? Why would we have

increase 30 per cent more revenues under that item as opposed to last year?

MR. DICKS: We have 1.1.07.

MR. SULLIVAN: Yes.

MR. DICKS: Okay.

MR. SULLIVAN: Our recoveries are up fairly significantly.

The year before we anticipated 6.6 and we had 6.1, now we have almost $8 million

so, does that mean the government has taken a fairly strong-arm approach now in

getting out there and twisting those arms, forcing people to pay back or making

deductions in cases from people who owe money, from other sources to get their

money back?

I will use the example: Somebody had a loan from the

Fisheries or Fisheries and Farm Loan Board, they might have excess revenues

within their family income to get money back as opposed to taking it directly

from that fisher? Could that have accounted for some of that?

MR. DICKS: Yes. Just on the point. I have the details

here, It is just taking me a moment to get exercised here. There might be an

extraordinary item in there, that is 1.1.07, I think you said. This covers the

various loans that interest payable to the Province includes, as you say, the

Fisheries Loan Board, Enterprise Newfoundland and Labrador. What happened last

year was that there was a reduced estimate of interest to be remitted by

Enterprise Newfoundland and Labrador last year 1995-'96. Part of it is that we

are getting an increased amount from that, but the major increase this year is a

payment by Corner Brook Pulp and Paper of $1.2 million, from five years of

accrued interest on a $4.3-million loan, at $5.6 million from the Province that

was advanced in 1992 and there was a five-year interest moratorium on that, so

that is the main item that has bumped that up and other than that, that accounts

for most of the amount there.

The reason that the revised figure was more than in the

Budget had to do with a reduced amount of interest earned by ENL. The exact

reason for that I don't know; they may have taken some greater time to either

get their money out or they might have had greater interest losses than they

presupposed at the time during the Budget, but the main item there was the

payment by Kruger or Corner Brook Pulp and Paper that we didn't have last year.

MR. SULLIVAN: Or maybe, more actively pursued interest

like last year there was a fairly good crab fishery and maybe they had more

interest payments back on previous loans. As an example:

MR. DICKS: The main reduction last year was that, we

budgeted last year for $6.652 million, we only collected $6.187 and the main

factor there was ENL remitted less interest than it had forecast. I don't know

the exact reason for that; it may have had to do with either interest that was

written off or perhaps they lent out less money than they supposed, because we

carried forward $5.5 million in commitments from last year. It could be due to a

variety of reasons. The main reasons up this year is as I say, the one we

started getting that remittance from Corner Brook Pulp and Paper.

MR. SULLIVAN: Okay, thank you.

On 1.2.01, that is Rental Purchase, a capital there, that

$77,200, is that entirely the Trans City money put aside to buy back the three

hospitals in that deal? Is that exclusive before that?

MR. DICKS: Yes. That is the sinking fund for that.

MR. SULLIVAN: That is the only one in that category - the

total amount per year, I think, for thirty years?

MR. DICKS: Yes, well, over the thirty-year lease it

provides for the $15.9 million purchase price, so we have estimated here.

MR. SULLIVAN: Okay. Once again, under l.3.01, Guarantee

Fees Non-Statutory, we used to collect roughly $10 million for guarantee to debt

of Hydro and now it is up to - is this all related for guaranteeing the debt of

Hydro?

MR. DICKS: No. If you talk about 1.3.01, that doesn't

have anything to do with guaranteeing the debt of Hydro, it is when we are

called upon to honour a guarantee. When the person defaults or the corporation

defaults, we have to honour that. Sometimes it involves taking possession of

goods, so we, for instance, would have to store assets, appoint receivers, legal

fees, hiring of consultants and so on. So we put in an estimate each year of

$50,000. (Inaudible) we have to spend, I suspect, in other years we may not have

to actually realize or seize the assets or realize upon them. So that figure is

put in there. That is not a fixed clause, that is variable, depending on what

actions are necessary as a result of guarantees being called.

MR. SULLIVAN: Thank you, Mr. Chairman.

Yes, that is the $50,000 on Professional Services, but

underneath is the Provincial Revenues aspect.

MR. DICKS: I see, yes.

MR. SULLIVAN: I am wondering - I didn't see (inaudible)

here the amount for Hydro. I am under the impression that that might be the

entire amount we are getting for guaranteeing the debt of Hydro.

MR. DICKS: Not exactly. It is composed of a number of

things. It is all money that comes from Hydro. I can give you the breakdown of

it. Last year, the figure was revised downwards somewhat from $11.178 million to

$10,992,000. That was as a result of a slightly lower guarantee fee. As you

know, we collect 1 per cent of the guarantees that we have outstanding. Hydro

went to market late last year for I believe it was $150 million. It is actually

tied to the amount of borrowing, and those fluctuate from year to year. So that

is really a minor item.

In the current year, there is an additional $8 million in

there, and what we are doing is, we are bringing forward the payment of the fee

by Hydro of three-quarters of the estimated $10 million annual fee. So what we

are doing is, we are accelerating the amount of the guarantee fee from Hydro.

The reason it is higher is that what we are essentially doing is, next year,

instead of taking it on a quarterly basis, we are asking them to pay the full

guarantee fee for the fiscal year 1997 in the first quarter. So that is the

reason the guarantee fee is up by about $8 million.

MR. SULLIVAN: Okay. So, increasing the guarantees - I was

under the impression we were going to be getting, in addition to the other

monies we are getting from Hydro on dividends, this extra increase now is only

for this fiscal year and it is an advanced borrowing on next year -

three-quarters of it is, because one-quarter, from January to March, l997, would

come out of Hydro's - the next year. But here, we are getting that quarter,

which was the only one figured in - from April 1 next year to December, we are

getting paid in advance for that. So we are getting in advance, monies from

Hydro. In other words, we are borrowing on our revenues for next year, and would

this not increase our structural deficit further?

MR. DICKS: Well, yes and no. We are not borrowing the

money. Hydro has this as a debt to us. What we are doing is - Hydro's fiscal

year, I think, may end December 31. What we are saying to Hydro is: You have to

pay us this amount of money in the next calendar year, 1997, so what we want you

to do is pay it in the first quarter rather than pay it over the whole year.

What it means is that we receive more money in this fiscal year. If we continue

the practice, we won't receive $19 million from Hydro next year, it will

probably be back to the figure of $11 million, in other words, if we carry it

through.

So, what we are doing is, we are accelerating the payment for

the next calendar year into this fiscal year, and really, what we are doing is

bringing up the amount by about three-quarters of what would normally come to

the Province in the calendar year as opposed to the fiscal year, which overlaps.

MR. SULLIVAN: Thank you, Mr. Chairman.

Well, basically, what it boils down to is, it is going to be

that much less we are going to get in the subsequent quarters, (inaudible)

getting it up front. In other words, there are going to be some quarters we are

not receiving that.

So, basically, we are getting it all applied, even though

their fiscal year, I did check, runs December 31.

MR. DICKS: That is right.

MR. SULLIVAN: And ours ends on March 31. So, technically,

we are getting into our fiscal year, but in the first three months of their

fiscal year, they are really paying us all they were going to give us in the

next nine months of their fiscal year.

CHAIR: The hon. the Minister of Finance.

MR. DICKS: Yes, that is correct. I should point out as

well, this does not mean that we will go back down to $3 million in the

following fiscal year, because if we accelerate and keep it accelerated we will

stabilize at the amount of $12 million, but it does give us a higher amount in

this year, essentially around $8 million.

The other thing I should mention is that it is more than

hydro. There are probably about fifteen or sixteen companies in here, and what

we do is - this is where the guarantee fee comes in, so it is Atlantic Group

Limited, Stuckless, Carol Stores and Fisheries, and so forth. There are a number

of other guarantees, but by far the major portion of it is the hydro payment to

us which makes up $18,750,000 of it.

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

MR. SULLIVAN: So when it goes back for that proportion,

or the other three quarters, technically we have increased the amount. Really

the difference for those nine months then is technically increasing our

structural deficit by that amount. If we are back to $12 million next year we

have increased our structural deficit another $7 million that we have not

allocated. We have looked at a structural deficit now of $45 million we do a

full borrowing. We borrowed $42 million on Term 27. We would get $8 million

anyway; we borrowed another $42 million, really, so we have taken $87 million

there on a structural deficit. This is going to give us another $7 million on a

structural deficit, so technically now when we do our Budget next year, before

we get to home plate to start even we have a $96 million technically structural

deficit we have to build into next year's Budget when you look at this. Because

we have different fiscal years, we are shifting it into this fiscal year, which

is really borrowing a bit on the future, because this revenue next year should

reflect less money, probably $7 million less. Is that correct?

CHAIR: The hon. the Minister of Finance.

MR. DICKS: Well, I don't like to deal with argument.

Certainly it is an

interpretation one can put on it, but if you want to talk

about the amount on the structural deficit you also have to take off that $30

million contingency fee which we have built in which is not part of our

structural deficit. That is to deal with what may or may not happen during the

fiscal year.

The second thing is that in order to know what our structural

deficit will be for next year we have to see what the cost of government will

be. We do plan to very seriously address the whole question of the program areas

of government, and at the end of the year when we see what the cost of our

programs are we will see in greater detail what the structural deficit is.

I fully hope and expect that it will be less than this, but

even if the hon. gentleman wishes to make the point that should all our expenses

stay at the same level, and presumably our income would stay at the same level,

our structural deficit would not be at $90-odd million even if you add this back

in. You would still have to take off $30 million.

MR. SULLIVAN: Take off $30 million, yes.

MR. DICKS: Yes.

MR. SULLIVAN: I will be back in one minute.

CHAIR: I was going to say the hon. the Opposition Leader.

The hon. the Member for Kilbride.

MR. E. BYRNE: Thank you, Mr. Chairman.

CHAIR: I was going to give you a promotion.

MR. E. BYRNE: Pardon me?

CHAIR: I was going to give you a promotion.

MR. E. BYRNE: I think Mr. Chairman may be up for a

promotion, or certainly would enjoy a promotion at some time.

I just have a few remarks to make, not necessarily being

specifically on Budget matters related in the Estimates accounts but dealing

generally with the economy. Maybe the Finance Minister can answer some

questions.

What I don't see, particularly in this year's Budget, is a

great deal of support for small business, or attracting small business to the

Province, or providing help or incentives for small business that would do a

number of things: One, that would assist in new businesses operating or opening

up. Traditionally any new business that opens up, the first twenty-four months

are the hardest period, but I was reading today in The Globe and Mail

that small business has grown by 57 per cent across the country and has again

this year led the way in the creation of jobs. (Inaudible) in The Globe and

Mail .

MR. DICKS: What has?

MR. E. BYRNE: Pardon me?

MR. DICKS: What has led the way? I am sorry, I didn't

hear you.

MR. E. BYRNE: Small business.

MR. DICKS: Small business.

MR. E. BYRNE: Businesses which are employing twenty-five

people and under. Basically, if you use that definition it is a small business.

That is a group in the private sector which has demonstrated

again this year that the real creation of jobs is taking place at that level.

There is more partnering going on between businesses in terms of applying for

national big contracts, major contracts, but what concerns me in the Budget is

the lack of support - support not being there to encourage small business to not

only come to the Province, but the incentives that should be there right now for

businesses that exist, and there are all sorts of examples.

Certainly, in the food industry there are many examples of

people who are into secondary processing right now who need, not assistance, but

need, I guess, some incentive from government, not only dollar-wise, they could

do without that, but on the other end of it as well, to bring down some of the

barriers where these larger food chains are into it. Some of the questions I

have for the minister: Where does he see government policy? Is there a

government policy that looks at small business? What are the details of the

policy? Where does he see government going in maintaining small business,

attracting new business and which in effort, generates jobs and generates much

needed revenue to individuals out in the community. I don't know if he can -

CHAIR: The hon. the Minister of Finance.

MR. DICKS: Thank you, Mr. Chairman. A number of

interesting points: People always point to small business and a lot of people

don't realize that the definition of small business, for many purposes of

statistical analysis, is not 2,500 employees, rather it is between 500 and 1,500

employees. If you take that as criteria, there are very, very few enterprises in

this Province which constitute small business.

MR. E. BYRNE: I was using small business -

MR. DICKS: Yes, now, I heard your point and I just wanted

MR. E. BYRNE: (Inaudible) which would be considered small

a business.

MR. DICKS: That's right. So the first thing I would point

out is that in terms of national statistics you have to be very careful when you

are talking about small business, because they may not be talking about the same

sorts of business you and I are.

The second point is that, you mentioned about partnering. It

is interesting that if you look at some of the strongest economics in the world

- places like Singapore and Hong Kong - the types of businesses that generate

the type of activity in those economies are not very large businesses. They are

small businesses but great conglomerations of them. The most classic example is

in Italy which is doing very well, notwithstanding the fact that the political

situation is very turbulent in Italy. The economy is very, very strong which is

not always reflected in its GDP figures because there is massive tax avoidance.

The strength of their economy, particularly in Northern Italy, where they have a

very strong tool and dye industry, clothing manufacturing, eye glasses, a lot of

very high end consumer items, in particular, most of that is done by very small

firms. What they do is contract out very small portions of that enterprise. So

you have very large conglomerates making a lot of high-level consumer goods

which consists of very few employees and they might have as many as 250 small

companies sub-contracting with one major enterprise. A classic example is eye

glasses. I forget the name of the manufacturer - twelve individual pieces in eye

glasses; the lens, one part of the frame, another part of the frame, one screw

holds them together. A different company manufactures each one of those.

So some of the other very successful economic systems in the

world do not rely on everything being done in one place by one company but

rather contracting it out. This whole aspect of business partnership is critical

to those economies. So that by if one company sees an opportunity it does not

see it as an opportunity for individual growth but rather it is a way that these

groups of companies, which have amassed around building particular small

components that go into a particular consumer good, can be sub-contracted out.

So what you do is, number one, you reduce the need for heavy capitalization by

one particular company and also you spread around the activity in a much more

efficient manner. So I agree with you, partnering is very important and I think

largely it has been unrecognized as a way to do business here in North America.

As regard to our lack of support for private enterprise or

for small business, I would disagree with that. I think the government's

approach has been different. My personal view would be, and I have expressed

this here and elsewhere publicly, it is one that - I don't say I speak for

government policy entirely but certainly an area we are moving in - I think it

has been shown that direct government assistance to business does not yield good

results for the most part. When you lend money to a business, you are not

necessarily helping the business nor are you making the best use of taxpayers'

money. Unfortunately, a lot of the money that government spends is not always

wisely directed nor is it wisely spent. My view is that we should do less of

that rather than more.

Where I think we can perform a role is through the tax system

in making encouragement or helping people in that way. So the EDGE plan is one

that seems to be working very well. Secondly, harmonization, I think, will be a

very big factor in the success and growth of our industries over the next

several years for all the reasons that you claim, business inputs. It greatly

enhances your exports and it also rationalizes your tax system. It certainly

gives our business a competitive advantage over those. The GST system has been

analyzed and found to be probably the simplest and most tax effect way of

distributing these sorts of monies and collection of them.

So I think those are the two directions government is

proceeding in, and is very clear on government policy, both of which I think

will be very successful in igniting the economy in these areas over the

mid-term, I say four to five years.

CHAIR: The hon. the Member for Kilbride.

MR. E. BYRNE: Thank you, Mr. Chairman.

The Minister of Finance has indicated that - it seems that

government and not only this government but governments across the country are

questioning the value of direct sort of financial incentives or assistance to

small, medium, or large size businesses. I would tend to agree that I think the

jury is in on that and we have to be more prudent in terms of what we look at.

Government has within its control far more avenues than providing small business

in this Province with say a $50,000 or $100,000 grant that may assist in

expanding a shop or bringing in more capital equipment.

Let me give you one example. Downstairs in government's

cafeteria, one of the largest outlets in terms of food distribution for major

food companies in the Province, you can go down there right now and buy Fairlee

juice out of Ontario, promoted as a fresh juice company. Just to give a history

on it, all the water for Fairlee juice comes from Lake Ontario. It takes 100

chemicals to purify the water that is mixed with concentrate in that juice. Yet

you go downstairs right now in our cafeterias, the small one and the larger one,

and all you can see on the shelves is Fairlee juice; yet locally we have a

company that is providing work locally, that is bringing in concentrate locally,

that is providing fresh water mixed with concentrate, a far superior product,

that is price competitive, that guarantees supply, and that could, if the

barriers were not in place, provide to our outlet here; but you cannot find

Sunnyland juice down in our cafeterias. Last year you could. I kicked up about

it in the House of Assembly last year and two days later I went down and they

had, right over in the corner, about two rows with about eight bottles in each

row.

Government has the ability when calling the tender to

stipulate three things, one, if there is a Newfoundland product that is

available in terms of, say, juice, that is not open-ended, as long as the

playing field is level, one that is price competitive, that can guarantee supply

and the quality is high, it should be down there. Yet we are importing products

like that and selling them ourselves in our own outlets, a far, far less product

in terms of quality.

So the question I ask the minister then is: When we talk

about incentives or help for small businesses, there is a wide range of things

that government can do without it costing government one penny. That is but one

example. You talk about the use of the tax system. I think this Province never

really has used the tax credit as an incentive to the extent we could, or

should, and that is another area that we really should start investigating when

it comes to small business in terms of our definition of small business, not

those between $500,000 or $100,000, but maybe small business of $25,000 or less,

or fifty employees or less. Government has a lot more strength and a lot more

pull at its fingertips right now if it chooses to exercise it.

I know that there are people who met with the Minister of

Health, for example, on some of these issues, who have lobbied him in talking

about how the larger food companies have control over bringing products in from

outside the Province and selling products from outside the Province, replacing

products that exist here today. I think government should take a serious look at

that because each time we take a product like that from, say Ontario or from

anywhere else, when we have a product that exists here, and again I have to

reiterate, that is price competitive, can guarantee supply and provides quality,

then government really, whether it is intentional or non-intentional, directly

or indirectly, is putting people out of work. I think it is something that

government must look at in terms of its own operations to ensure that small

business has every opportunity to do business with government through whatever

means or outlets it has.

CHAIR: The hon. the Minister of Finance and Treasury

Board.

MR. DICKS: Thank you, Chair.

The hon. member makes some interesting points, most of which

I find myself in agreement with. The first is that economic activity and growth

comes from two areas, one is by supplying your own needs provincially. Let us

use provincially as an example.

MR. E. BYRNE: Which we don't in that industry.

MR. DICKS: Pardon!

MR. E. BYRNE: We are not at a point yet where we supply

our own needs within the food and agrifoods industry.

MR. DICKS: Well, you have to recognize and define those

areas where you can supply your own needs. I doubt that we will be growing

oranges and grapefruit here.

MR. E. BYRNE: No, no.

MR. DICKS: I know that is not your intent, but you have

to be very careful about what you define as legitimate areas of economic supply.

So you have to look to the things that you can reasonably and economically

supply to yourself, and while you can supply many things it may not be

economical to do so.

MR. E. BYRNE: Let us use as a measuring stick the three

criteria I talked about, as long as the products are price competitive, that we

can guarantee supply, and that quality is assured.

MR. DICKS: The hon. member had ten minutes and I am only

thirty seconds into what I am going to say. I agree with you on that point. The

second thing is how you generate activity through export, so you define

something we do that you cannot do elsewhere. That often comes from resource

areas where you have minerals or other products that you can mine or take from

your renewable resources and export. That has been the secret in many ways of

economies. The other difficulty you have, unfortunately, is that if you are too

successful you become a victim of your own success.

An example is, which has done so staggeringly well, it has

amassed over $200 billion worth of foreign reserves and its economy is in

depression right now, because they have driven up their own wage cost and

everything else, so that now a lot of work is shifting away from Japan into

places like Vietnam. Even South Korea and Singapore are becoming too expensive.

To get back to the point of doing our sourcing, in another

five or six years when we have completed our task it will be there.

MR. E. BYRNE: Minister, you are not saying you are afraid

that government is going to do that, are you?

MR. DICKS: No. I think it was the previous, previous,

previous, Premier, Peckford, who said that he was afraid the economy would

overheat itself. We don't share that concern at this point in time. We can turn

off the heat in many ways.

As regards to the juice issue, I don't get as much time to

take lunch as the hon. member does so I don't get a chance to keep track of what

happens in the cafeteria.

MR. E. BYRNE: You dine at the Cabot Club and I dine

downstairs in the cafeteria. That is the difference between you and me.

MR. DICKS: I would say that I envy his ability to find

the time to do so. I can say that I am often at government meetings in Cabinet

and I do know that Cabinet has taken some pride in supplying itself with locally

produced juices from, I think it is Sunnyland. So we certainly have taken the

initiative within the confines of the Cabinet.

As regards to the government cafeteria, one of my members

from Conception Bay East & Bell Island, I believe, advised me that it may be run

by the CNIB. So there are areas in government where people may provide

activities that we can't ourselves dictate to; these things are contracted out.

MR. E. BYRNE: The government has demonstrated that they

can dictate anything within the tender process.

MR. DICKS: But let me get to the real point of what I

want to say.

MR. E. BYRNE: I think you have demonstrated that in the

seven years that you have been there. So I mean, (inaudible).

MR. DICKS: The government has initiated a program of

`Made Right Here' in order to encourage people in Newfoundland and Labrador to

buy products that are made here, and I am sure when you go to the supermarket

you always buy those things that come with the nice, little flag on it that say:

The butter is made here and the margarine is made here and our bread is made

here and our milk is made here. I do that, I very consciously look for things. I

think they are good products and we should be conscious that what we buy is

producing jobs here in this Province, and I am sure your comments are well made.

The only other thing I say is that in terms of government

procurement, the decision was made several years ago to try to lower provincial

government barriers and it was found at that time, if my recollection is

correct, that removing the provincial preference, which was then about 15 per

cent, would only affect about 3 per cent of the total goods procured in

Newfoundland. Our challenge has been to open up the other markets because people

have different public tendering rules, Nova Scotia being a notable example.

Our Public Tender Act is at $5,000, theirs is at $50,000 as a

threshold amount. My colleague, the Minister of Industry, Trade and Technology,

tells me that quite a number of our businesses are getting successful in

supplying goods and services in other provinces. So I think we can be a little

too colloquial. If we can restrict ourselves and say, we have to, you know,

bring the tents around and bring the wagon trains in and fight off the Indians,

we may be losing opportunities; because, as I say, you not only gain by

satisfying your own needs, the greatest economies grow by satisfying the needs

of others through export as well. We have to be careful that we try to do those

things which are most economical to do so here.

Finally, you mentioned tax credits. I do believe there is

merit in that notion. You have things like accelerated depreciation and things

like this but I think they have to be used judiciously, and it is certainly an

avenue that I think can be explored and one that is open to suggestions.

CHAIR: The hon. the Member for Kilbride.

MR. E. BYRNE: Chair, I wasn't going to make a few remarks

but I have to based on some of the remarks made by the Minster of Finance and

Treasury Board.

MR. DICKS: Very stimulating remarks of the minister.

MR. E. BYRNE: I would agree that the `Manufactured Right

Here' campaign, is a campaign that is working to some extent, that is necessary

and has provided value in terms of raising the awareness of people within the

Province about products that are manufactured and produced right here. The

yardstick where he says we shouldn't be too concerned, or we should be concerned

in not building tents around ourselves, I am aware that we live in a global

village where trade is happening no matter where you live in the world with

people from all over the world. What I am saying, is that, where products are

produced in this Province, where, number one, they are price competitive - it is

a very important point - where they can guarantee supply, another very important

point, and that the quality is at least equal or greater than, then why should

government be ashamed of ensuring that those products are sold or purchased

through other outlets?

It is one thing to say and be proud of a `Manufactured Right

Here' campaign on the one hand, when on the other hand, when people who

manufacture goods and products come to government, government says, although it

is manufactured right here, we are not going to let you sell it right here. I

mean, that is real. Last year, for example, in the Health Sciences complex, the

Newfoundland Tea Company was thrown out of the Health Sciences complex,

displacing about six people in terms of work, and the Health Corporation

purchased the Tim Horton's franchise. You know, there are things that we must be

aware of.

In terms of the amount of time that I have to eat lunch, I

say to the Minster of Finance and Treasury Board, I don't think it is a question

of time, that I have more than he; I just think it is a question of where he

dines compared to where I dine.

Thank you.

CHAIR: The hon. the Minister of Finance and Treasury

Board.

MR. DICKS: Thank you, Chair.

I dine in my office generally speaking and send someone

downstairs to pick-up something for me.

On the other point, the price being competitive, I agree with

the hon. member, but I say as well that my personal judgement is that I am

prepared to pay a premium for things manufactured in this Province, because it

does me more good, personally, and creates more economic activity. So if the

quality is equal, then I think that is fair comparison. I think we do things

very well here in the Province, and very often we pick out the cheapest thing on

the shelf, instead of maybe saying: Where is this done? It means more to put it

into the economy.

I take the hon. member's points - I think we are in large

agreement on the issues that confront the Province. The only thing, as I said,

is that it is good to be concerned about what we do here, but I think we also

have to look for opportunities elsewhere. The other area of focus which we

should not neglect is that we have a lot of potential in this Province in a

whole lot of areas to produce and export, not only goods, durable goods,

reusable goods, but also services and intellect, which is one of our greater

exports.

There are tremendous opportunities right now on the Internet.

I was in Labrador City during the hearings and I picked up a magazine down there

- I forget which one it was, but I noticed the lady was on the front of the

Newfoundland Herald recently, and this lady in Labrador City, downloaded all the

information on the X-Files and wrote a book, and it has something like 200,000

copies sold. That's incredible! A Canadian bestseller is what? 30,000 copies,

and she is selling them worldwide. I mean, the greatest tool we have at our

disposal that equalizes intellectual opportunity throughout the world and

throughout the Province in any isolated area, we have the highest - I think we

have the greatest fibre-optic network per capita in the country, if not the

world. I mean, it is a tremendous opportunity for people - and I am only

beginning to use it myself, but we have a telecommunication system that is

really second to none. If people start getting on the Internet, and seeing the

opportunities, what is being bought and sold and the things one can learn and

download in the areas and avenues of communication, it is the single biggest

tool, and I think, in addition to that, it would be probably the greatest engine

of economic growth beyond anything else we will see in the next decade.

The opportunities are just tremendous. That one particular

example, I think, tells us an awful lot about what opportunities exist. So I

will leave it at that.

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

MR. SULLIVAN: Thank you, Chair.

We also have the greatest fishing resource in the world, too,

and if we don't use it properly, it won't mean diddlysquat.

I will get back to the more technical side, I say to the

minister - page 7, 1.3.02. I will just follow it along in order, any particular

questions I have, and that will probably facilitate it.

Under Capital, there was a budget in 1995-'96 of $1 million

and an expenditure Loan Advanced Investments of over $11 million. Why would

there be a discrepancy there of an extra $10 million?

MR. DICKS: Three words: Middle distance vessels. I don't

think you want me to enlarge on that, but they weren't the most prudent

investment the Province made. It was made back in the mid-1980s by the former

government. It seemed like a good idea at the time, but as the hon. member

knows, a lot of things seemed like -

AN HON. MEMBER: (Inaudible).

MR. DICKS: Well, I have my views on it as well. In any

event, we are stuck with long-term leases. They have been useless. They have

been tied up at a wharf on the South Side of St. John's harbour for the most

part. The Province has been trying -

AN HON. MEMBER: Were.

MR. DICKS: Were tied up. We are gradually divesting of

them. We had sold three of them the last year -

AN HON. MEMBER: (Inaudible).

MR. DICKS: Pardon me?

AN HON. MEMBER: (Inaudible).

MR. DICKS: Yes, you are probably right. I forget the

names. I think three of them were divested last year, one is with the

University, two are in private hands. I think we might have gotten about $1

million for one. The University is doing something with respect to a lease, or I

think they are keeping expenses. In any event, in order to get them off our

hands, we had to pay them out. There was $11,079,700 that we had to pay out

under the leases. The proceeds from the sale of the three vessels was

$3,850,000. That is why you see in the revised the gross figure, the figure in

brackets underneath is Revenue realized, so that is for net of about $7,250,000,

roughly. So, what can I tell you.

CHAIR: The hon. the Leader of the Opposition.

MR. SULLIVAN: Thank you, Chair.

Under Pensions and Gratuities, Statutory, 2.1.01, page 9 in

the Estimates. Now, this has happened several times here. Maybe the minister -

and it is probably an adjustment thing but I won't have to ask it in other items

if I get a satisfactory answer. For instance, sometimes last year in the

Estimates there was a figure used - and I will use a specific one so we can

reference it - under .02, Employee Benefits, last year - it is showing here in

the Budget for 1995-'96, $52.12 million but actually, if you looked back at last

years Estimates it is $51,708,000. Now that happens in a lot of cases, what was

in the Estimates last year and what reappears this year. Now, I am assuming

there could be adjustments in or out into other areas but in instances they

were, I have not been able to track where they were, and I am not sure, so why

would discrepancy be in what we saw in the Estimates last year and what they are

telling us the Estimates were last year? It is not the same in many instances.

CHAIR: The hon. the Minister of Finance and Treasury

Board.

MR. DICKS: Thank you, Mr. Chairman.

In response to the hon. the Leader of the Opposition's

comment, what has happened is that Treasury Board, in going through the

Estimates, has tried to reconcile the amount that was allocated last year by

departments to the new structures. For example, last year we had fourteen

departments and I believe we now have sixteen. What has happened is that some of

these amounts have transferred between sub-heads to more accurately reflect what

the actual cost was. So, for example, the Department of Development and Rural

Renewal did not exist last year. So what Treasury Board tried to do, where

employees have been transferred, for example, or now are transferred, they have

moved those amounts over. Now, I did ask the department to provide me with a

specific answer to these questions. The only thing I would say is that it might

be difficult in parts related but I will attempt to do so. Essentially, what it

is though, is where in the 1996 Estimates it says that the 1995 estimate was a

certain amount and it differs from the amount in the 1995 Estimate book, that is

a reflection of where the department has readjusted the estimate to take into

account the realignment of responsibilities; that is the answer. In each

specific case I could probably give you the detail as to what was moved in or

out.

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

MR. SULLIVAN: Thank you, Mr. Chairman.

No, I have tracked those down in many instances where there

were now sixteen departments technically as opposed to fourteen ministries, but

I don't see how this would affect this item, because contribution to pension

funds are not broken down by department anyway, they are a total. So it would

not apply in this case, even though I have tracked it in other cases, and I will

make reference to some of these as I get to them. But pensions is not broken

down by department, it is strictly under the Consolidated Fund Services, and I

couldn't see why it would be in this instance. I could understand in other

instances. Does the minister have an explanation why that might be the case

here?

CHAIR: The hon. the Minister of Finance and Treasury

Board.

MR. DICKS: Thank you, Mr. Chairman.

I think the hon. member said that the estimate for last year

was $51,700,000 and-some-odd I believe, was that the correct figure -

MR. SULLIVAN: (Inaudible).

MR. DICKS: - $708, I don't know why that would be. I can

detail for the hon. member what the actual expenses were and what they are in

the current years Estimates. Why that should vary, I agree with him, because the

amount should be the same. This is a central entry for the Consolidated Fund

Services but if you will allow me the liberty I will check on that and get you

the explanation for it.

CHAIR: The hon. the Leader of the Opposition.

MR. SULLIVAN: Thank you, Mr. Chairman.

No, there is no need. I am not really looking for specifics

because I know the nature of the pension fund and what is involved. It is just

that in this item I couldn't see it and the minister said he would get it, I

appreciate that.

Under the next one, Ex-Gratia and Other Payments, the large

increase there, I would assume, is because of a lay-off in the number of

positions now. There is going to have to be a fair number of settlements,

retirements and pay-outs in this area and that probably is stemming maybe solely

from the increased numbers of people whose services are being terminated. Would

that be basically correct in 2.1.02, Employee Benefits? I don't know if there is

any other extraordinary thing besides the termination of employees in your

estimate of what the cost is going to be by the time the terminations and all

that occur.

CHAIR: The hon. the Minister of Finance and Treasury

Board.

MR. DICKS: We have allowed $15 million as a rough

estimate of the severance cost, that is the main difference there. We have

actually budgeted $15,033,000. Last year we had budgeted $90,300, so

essentially, $15 million being the difference in severance cost.

CHAIR: The hon. the Leader of the Opposition.

MR. SULLIVAN: Thank you, Mr. Chairman.

We will move along quickly now to Executive Council. It gets

more interesting when we get into the Executive Council. Consolidated Fund

Services can be kind of boring, I say to the minister.

CHAIR: Order, please!

Are we ready to pass the heads on Consolidated Fund Services

before we get to Executive Council?

MR. SULLIVAN: Yes, Mr. Chairman, you can move with the

motion on this.

On motion, subhead 1.2.01 carried.

On motion, subhead 1.3.01 carried.

On motion, subhead 2.1.02 carried.

On motion, total carried.

On motion, Consolidated Fund Services, total heads carried.

CHAIR: Executive Council.

The hon. the Leader of the Opposition.

MR. SULLIVAN: Thank you, Mr. Chairman.

MR. DICKS: I wonder if the hon. the Leader of the

Opposition -

MR. SULLIVAN: You want to introduce it?

MR. DICKS: Yes.

MR. SULLIVAN: To tell us about protocol, is it?

CHAIR: The hon. the Minister of Finance.

MR. DICKS: Just for the purpose of explanation, I will

try to do this. It took me three, four or five passes at it to figure out what

we had done.

In the Interim Supply Bill, you may recall, we approved a

funding allocation of $27,405,000 as a total for the whole Executive Council. I

will try to follow this through. It was, let's say, $27.5 million roughly,

$27,405,600. That amount, and you will recall I said at the time, included

funding of $20 million for the Economic Renewal Agreement; we had budgeted that.

The reason we did that at the time was we did not know how those funds would be

allocated among the departments, so we stuck it all in Executive Council because

we wanted to be able to get some of those projects moving if any had been

approved before the main Budget went through; however, what we have done is we

now have a clear idea, having gone through the Budget process, so we have

allocated those monies to the individual departments. So what we are taking out

is $22,685,000. Of that total, I should say, $450,000 remains in Executive

Council; $2,396,000 in Fisheries and Aquaculture; $3 million even in Forest

Resources and Agrifoods; $7,445,000 into Industry, Trade and Technology;

$6,814,000 in Tourism, Culture and Recreation; and $2,580,000 in Education, for

a total of $22,685,000.

MR. SULLIVAN: (Inaudible) education.

MR. DICKS: Education was $2,580,000.

If we go back, when we voted that $27,405,600, that included

three months of the normal funding for Executive Council. The total amount we

need for Executive Council is $21,291,900; however, in the Interim Supply Bill

we approved $27,405,600. In other words, in Interim Supply, we approved

$6,113,700 more than we need. So, in doing the Estimates, the advice of the

Clerk, which I always accept, is that we should vote a negative $6,113,700 in

order to put the Estimates at the right level. So, just to round off the

figures, in Interim Supply we voted $27 million in order to put this funding in

there for the renewal program. That money is now allocated in other departments.

So in order to adjust the figures, we had to vote a negative $6 million, in

other words, take money away from the Interim Supply amount in order to get it

down to the $21,291,900 we actually need.

So, when it comes to voting the estimates - and I know you

want to speak to the estimates - the actual amount to be voted will be not a

positive amount but a negative amount to readjust down from $27 million to the

$21 million we need.

I have an explanation of this, which I found a little unclear

in parts, but I will certainly photocopy it and make it available to the hon.

Leader or the Opposition, if he has any questions on it. Thank you.

CHAIR: The hon. the Leader of the Opposition.

MR. SULLIVAN: Thank you, Mr. Chairman.

Determinations are now made basically on that roughly $20

million. We are talking about Economic Renewal, the $100 million, of $20 million

this year. For instance, the $3 million would be the forestry centre under

Forestry and Agrifoods, and the other amounts will be on aquaculture

developments, etc., ITT, in line with the three lines in which the agreement was

intended to be expended. There are allocations made for that full amount within

those specific departments now.

I went through and totalled them up there, and they come to

approximately that amount. So I assume it is all being allocated. There is still

none left really in Executive Council, as such. Is there still some to be

expended? When we get to that item, I will ask that because I made a little note

as I went through it. So when I get to that I will address that.

Overall, if we look here at the Lieutenant Governor's

Establishment, we see an increase, of course, from $486,400 there under the

Establishment, to $757,300. Protocol now has been moved from Intergovernmental

Affairs to under the Lieutenant Governor's Establishment. What was the

minister's rationale now to move that out of Intergovernmental Affairs? Because

that accounts for the increase in expenditure under the Lieutenant Governor's

Establishment.

MR. DICKS: The rationale for that?

MR. SULLIVAN: Yes.

CHAIR: The hon. the Minister of Finance and Treasury

Board.

MR. DICKS: I believe the rationale for that - and this is

a general executive decision of government, not one specifically of this

ministry - is that most of the protocol involves the Lieutenant Governor and his

Establishment. We thought that it is more appropriate that it not be in the

Executive Council, but that it be within that area of expenditure of the

government. We thought it would more clearly show there within that heading. I

guess that is the essential answer.

CHAIR: The hon. the Leader of the Opposition.

MR. SULLIVAN: So, any other protocol costs now, other

than protocol dealing with the Lieutenant Governor; is there any provision now?

I don't see any other provision for protocol now.

MR. DICKS: Not that I am aware of, unless there are small

amounts lying around somewhere. The essence of this was to consolidate it all

under the general, I suppose, formal elements of government, the Lieutenant

Governor being somewhat separate from the general running of government, it

being the Crown, representing that and protocol dealing with other heads of

state, Ambassadors and so forth. It made some sense to us to realign that

function with the general head of state function that the Lieutenant Governor

represents in the Province.

Other than that, if there is any other protocol amount, I

don't know that there would be other than there might be certain amounts

budgeted in departments for anticipated entertainment of dignitaries or

officials' receptions that might be hosted. But that aside, virtually all the

monies would now be allocated in this vote.

CHAIR: The hon. the Leader of the Opposition

MR. SULLIVAN: Thank you, Mr. Chairman.

I would assume there are other protocol costs, other than the

Lieutenant Government. For instance, if other premiers of provinces or other

significant dignitaries come to this Province, there are protocol costs that are

not directly attached to the Lieutenant Governor's Establishment, and they are

now not being reflected and it has been all moved under that heading.

CHAIR: The hon. the Minister of Finance and Treasury

Board.

MR. DICKS: Just in response to that, I thought I had made

myself clear on the point. Under 1.1.03, subsection 06, there is an amount in

there for $152,700 for Purchased Services. That would include the formal

entertaining the government does. Don't forget now, this overlaps into next year

which is the 500th. Anniversary Celebrations. So this is the amount that is

allocated to be spent by the Director of Protocol on behalf of government and so

on, just to run the visits of foreign dignitaries and so forth.

CHAIR: The hon. the Leader of the Opposition.

MR. SULLIVAN: Thank you, Chair.

The point I am making is still under the Lieutenant

Governor's Establishment and not under Intergovernmental Affairs where it used

to be. The reason for the increase then, I gather - I had a question on that and

I think the minister answered it - the reason for the increase from $131,500

last year up to $152,700 is because in 1997 there may be increased cost of

protocol as it might relate to our 500th Anniversary. Would that be the reason

for an increase of $20 some thousand, or probably a 15 per cent increase? Would

that be the sole reason?

CHAIR: The hon. the Minister of Finance and Treasury

Board.

MR. DICKS: Thank you.

Yes, as far as I know, but I would point out that last

$212,700 was budgeted and only $131,500 was approved. It would be my surmise,

without having the exact details of every particular reception, that the amount

is up by that amount from that actually spent this year, because next year we

are going to have a lot more people from foreign states visiting the Province

and it is going to be necessary for the Province to incur reasonable cost in

insuring that the visitors are accommodated, looked after, and all the rest of

it. Yes, in answer, that I expect is the difference, although I cannot tell him

per event how much it is; but I am sure that maybe floating around if you wish

it.

CHAIR: The hon. the Leader of the Opposition.

MR. SULLIVAN: Thank you, Chair.

I would assume too, that that is probably under .03 there

under Protocol. Transportation and Communication might be given as a similar

reason I would assume, rather than the minister rising again. That might be

similar, where you budgeted $24,700, spent $13,600 and back up to $32,200. It

might be because of increased involvement pertaining to a more active year. That

seems to be the same conclusion we can draw there, I guess.

Under the Premier's Office, an interesting one, under

salaries there - in the salary details book it is broken down into two. It is

listed there as Premier, $54,943. Would that include or exclude what was

instituted as a $20,000 entertainment allowance that came in with the previous

premier, Wells? Is that included in that $54,943 for the Premier's salary, or is

that his salary exclusive of that?

MR. DICKS: No, that's the Premier's salary in addition to

that as a member of the House. The hon. Leader of the Opposition and Cabinet

ministers receive approximately $39,000 and the Premier receives about $15,000

more than the more plebeian members of the House and therefore his salary unit

per se is $54,000.

CHAIR: The hon. the Leader of the Opposition.

MR. SULLIVAN: So the Premier's salary rounded off is

roughly $55,000, roughly $15,000 more than a minister. Normally, he would be

entitled to $40,000 as a minister, so it is basically only an extra $15,000 as

Premier. I guess $15,000 is probably worth the aggravation, I say to the

minister.

MR. DICKS: Well, I do not know if it is. There is an

awful lot of aggravation.

MR. SULLIVAN: We certainly hope to make him earn that

extra $15,000, I say to the minister.

MR. DICKS: You are certainly doing your best.

AN HON. MEMBER: The Minister of Finance came to the

conclusion that it was not worth the aggravation back in December anyway.

MR. SULLIVAN: Before I forget, that extra $20,000, where

would that be?

MR. DICKS: That is the Allowances and Assistance, 2.1.01

(09) MR. SULLIVAN: If we look at Executive Support 2.1.02,

there was an increase in the Budget amount last year of about $137,000, more

spent than budgeted last year. Would there be any unusual circumstance that

necessitated that expenditure? That is under Salaries, 2.1.02. Rather than

having to get up on a specific point, I will just ask a couple of more questions

on the next

section and then you could deal with those.

Also, under Administration we had $12,000 under Supplies,

(04), and Purchased Services, $18,800 and it went up to $28,500. There was a

doubling on Supplies and there was about a 60 per cent increase in Purchased

Services. Maybe the minister could indicate why those three were significantly

increased over the budgeted amount?

CHAIR: The hon. the Minister of Finance and Treasury

Board.

MR. DICKS: Yes, thank you.

I believe the first question was on Salaries. Originally,

$637,900 was provided and $774,200 was spent. I am just looking at the cost

here. There is an actual reduction in the current year in salaries by $97,400. I

am looking at the details here to determine why that revised budget was up by

that amount and frankly, I don't see the explanation for it here. I don't know

if that was additional people or if that may have included anything else that

was paid. I know that the Premier reduced his staff last yea