May 2, 1994                 HOUSE OF ASSEMBLY PROCEEDINGS               Vol. XLII  No. 34


The House met at 2:00 p.m.

MR. SPEAKER (Dicks): Order, please!

The hon. the Government House Leader.

MR. ROBERTS: Mr. Speaker, before we get into Ministerial Statements, if my colleagues have any, I would ask if the House could pause for a moment to take note of the death on the weekend of a former member of this House, Dr. Clifton Joy. Dr. Joy sat as the member for the old dual seat of Harbour Main between 1962 and 1966. My friend, the Member for Twillingate served with him in the House, and I guess, is the only person here who did. I came to know him well over that period, because I worked with the Premier as an executive assistant at that time.

Dr. Joy was a paediatrician of commanding stature who performed many public services to the people of this Province, both as a doctor and as a public official, but I would suggest that the event for which he would most like to be remembered, an event for which we should honour him today, was his involvement in the development of the Janeway Hospital here in St. John's. I think it is fair to say that there would not have been a Janeway Hospital had it not been for Clift Joy and for the lobbying he did and the powers of persuasion he exercised on the Premier and the Cabinet of the day.

He died, I understand, quite unexpectedly, and the tragedy is all the greater because this is the second death to have struck that family this family this week. His daughter-in-law, Mrs Christiane Joy whose husband is a lawyer here in town died earlier in the week.

I would ask, Sir, if the House could ask Your Honour to send a letter in the usual form, to Mrs. Joy on the death of her husband, to say that for his having served in this House, the people of Newfoundland and Labrador are the better because of his time with us.

Thank you, Sir.

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

MR. SIMMS: Mr. Speaker, we wish to join with the Government House Leader, and I am sure the Leader of the New Democratic Party, who I understand knew Dr. Joy very well, if I am not mistaken. We would like to be associated with the remarks of the Government House Leader and would endorse Your Honour writing a message of condolence to the family.

I didn't have the privilege of knowing Dr. Joy, but I have certainly heard of him. I heard about some members of his family. Debbie, I believe, was a daughter in Toronto who is an actress, and certainly a lot of people would be familiar with Robert Joy, who I believe is his son, the well-known Newfoundland - or international actor now, I guess.

Mr. Speaker, we would like to be associated with those remarks and ask that Your Honour send a message of condolence.

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

MR. HARRIS: Thank you, Mr. Speaker.

The Leader of the Opposition is correct. I knew Dr. Joy and his family very well. In fact, I had the honour and sad duty of being a pallbearer at his funeral today.

Dr. Joy has had a great love for politics mostly as a spectator; his one foray into politics would be 1962 and 1966. He said it was for the sole purpose of furthering his dream of having a paediatric hospital here in the Province, and he pursued that, as the Government House Leader has said, with persuasiveness on the Premier. He ended up in politics as a result of that but he was successful at the time, and I have talked to other medical people and paediatricians who were aware at the time that the struggle was very difficult.

The medical establishment was against it; the Newfoundland Medical Association was against it and he struggled on to fulfil this. He recognized that in this Province in the study that had been done in 1959, the number of children dying from gastro-intestinal disorders was astoundingly high, and he saw the need for a special facility here in Newfoundland; and I am delighted that the Government House Leader has recognized that it is indeed, that without Dr. Joy, there would not be a Janeway Child Health Centre in the Province. I was told by one of the senior paediatricians at that institution that there is almost no city in the world of the size of St. John's or larger, that has a hospital that can compare in terms of its facilities and its ability to look after children, and that is a credit to Dr. Joy and is worthy to his memory.

I know also, of course, his family, his sons and daughter and wife, all of whom will greatly miss Dr. Joy, who had just started his retirement. I join with all members in asking that the Speaker send the condolences of the House of Assembly and of the people of the Province to Dr. Joy's family.

MR. SPEAKER: The hon. the Member for La Poile.

MR. RAMSAY: Thank you, Mr. Speaker.

Mr. Speaker, the weekend also saw the passing of another municipal politician which I wanted to have duly noted. Ed Sheaves, a former mayor of Port aux Basques, passed away on Saturday and services will be held tomorrow.

Ed was a long-time municipal politician, having served for some thirty-two years in municipal politics. I think probably one of the longest serving municipal politicians in the Province's history, Ed was a colourful gentleman and a very eager and avid politician who supported his town and did so well over the years. And I would also note that even in his weakest moment, Ed was always the kind to even be caring for those around him in their grief at his condition. He was even at that point in time, still caring for those around him right up to the end.

I would ask, Mr. Speaker, that the appropriate acknowledgement be sent from the House in consideration of his long-standing service for his town and indeed for the Province. Thank you.

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

MR. SIMMS: Mr. Speaker, we also would like to be associated with the remarks of the Member for LaPoile. Many of us on this side of the House, including myself, in days gone by - particularly in the days when we were in government - had occasion to interact with Ed Sheaves and members of his council in those days. He has given long service to the town which he loved, I think it was something like thirty years - I was speaking with the minister earlier today - I believe thirty years or something is a long, long time to serve in municipal politics where you don't get a lot of remuneration and you get, sometimes, a lot of criticism.

I had occasion, as did many other members over here, of knowing Ed Sheaves and we would like to be associated with the remarks of the Member for LaPoile.

Indeed, I believe the funeral is tomorrow and the minister has kindly offered to take somebody from our side with him to the funeral tomorrow. I think the Member for Waterford - Kenmount, who no doubt knew Mr. Sheaves in his capacity as a municipal councillor as well, will be representing our party at that funeral. We would like to be associated with the remarks and ask that condolences be sent to the family.

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

MR. HARRIS: Thank you, Mr. Speaker.

I would like to join in with the Leader of the Opposition and the Member for LaPoile in recognizing the contribution of former Mayor Sheaves to the municipal politics of the Province. It's a long period of contributing and working in the hard field of municipal politics where there is a lot of hard work and a lot of grief from people who need the services of municipal politicians and who don't often get those with such dedication, considerable influence and energy has been exercised by Mayor Sheaves in the Town of Port aux Basques.

Statements by Ministers

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

DR. KITCHEN: Thank you, Mr. Speaker.

Mr. Speaker, today I table for hon. members the discussion paper for Board Restructuring Northern Newfoundland and Labrador.

Mr. Speaker, hon. members will recall that Ms. Lucy Dobbin presented to me in early 1993 her Report on the Reduction of Hospital Boards. Her report was prepared after our 1992 Budget Speech when government indicated that we would be exploring ways to reduce the number of hospital boards. Her report indicated that there was considerable interest and discussion regarding regional board structure in the northern region, which encompasses Labrador and the northern part of the Northern Peninsula.

Based on her report, and the considerable public interest being generated by residents of the northern region, government decided to have a discussion paper prepared outlining several possible options or scenarios for the governance and delivery of health services there.

This paper which I am tabling today sets forth five such scenarios. For each scenario, data on population, utilization, services and costs are provided. The paper then analyses each scenario in detail as well as mentioning advantages and disadvantages. It makes no recommendations.

In the next several days I plan to distribute the document widely to interested groups and individuals in the northern health care region, requesting feedback. I then plan to meet in the northern region with all interested parties to discuss the options further.

Once these meetings have concluded, I will be making my recommendations to Cabinet about the appropriate structure to deliver health care services to residents of northern Newfoundland and Labrador.

Thank you, Mr. Speaker.

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

MR. SULLIVAN: Thank you, Mr. Speaker.

We, on this side, have been saying for some time that what we needed was a cost analysis, and in northern Newfoundland and Labrador we do have five options now that range from a high to a low, I think, of $4 million difference on costs, under the five proposals to restructure the boards in northern Newfoundland and Labrador. So I applaud the minister on doing this for northern Labrador and Newfoundland.

I asked him, and we said before, on all the other boards in this Province there has been no financial basis or improved service basis by which hospital boards should be restructured, and over the next few days I will be going through and carefully looking at this report here that seems to be well documented, and it is very positive. I wish we had something like this over the past year to deal with all regions of the Province on a cost-efficient basis here.

Hopefully the right decision will be made in terms of cost and in terms of delivering service to the people of northern Newfoundland and Labrador, and having input from the public here is a very positive step that is severely lacking in all other regions of the Province.

Thank you, Mr. Speaker.

Oral Questions

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

MR. SIMMS: Mr. Speaker, I had hoped the Premier might be here, but -

AN HON. MEMBER: He will be here, but (inaudible).

MR. SIMMS: Well, I will pursue it. I wanted to ask him some questions, as leader of the government, related to the educational changes, so I guess I will go to the Minister of Education.

Mr. Speaker, may I say at the outset that we, on this side of the House, want to first of all compliment the government on what appears to be a significant step towards getting both sides back to the table, and hopefully to work on an agreement with the churches on organizational changes to the denominational education system.

We hope that the government will be successful. Personally I believe it is an important step that the government has taken and the details of this, the modifications at least, were tabled here in the House.

I have to say to the minister that there are elements still within that modification package that could easily cause negotiations to break down - I'm sure he is aware of that - unless the government somehow indicates publicly that it is in fact prepared to continue to be flexible in its position, in addition to the modifications that he put forward. I would like to ask him today: In resuming negotiations with the churches is the government prepared to be more flexible - continue to be flexible - and is it prepared to make other concessions if necessary in order to reach a reasonable agreement on educational reforms with the churches?

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

MR. DECKER: Mr. Speaker, I don't know how the hon. member expects us to be any more flexible than we've been. I mean, the royal commission report came in almost two years ago. Next month will be two years. We have been talking back and forth to every single stakeholder in the system. All I can say to the churches through the hon. member is that we will continue to be just as flexible as we've always been. I should also point out though that we are getting a considerable amount of criticism from people in this Province who are suggesting that we are being too flexible and that we should go ahead with these reforms.

Mr. Speaker, flexibility is our second name over here. We are known for our flexibility.

SOME HON. MEMBERS: Hear, hear!

SOME HON. MEMBERS: Oh, oh!

MR. SPEAKER: Supplementary, the hon. the Leader of the Opposition.

MR. SIMMS: I apologize to the House, Mr. Speaker, for bursting out in laughter but I think the reason is obvious. Even members opposite had to laugh at that line.

I'm glad the minister asked: In what other way can we be flexible? Because I happen to have a couple of suggestions and questions for him. I think he is astute enough to understand and recognize that there are still several issues on which, you know, in the modification that he tabled the other day, on agreements that he is looking for - could easily flounder. He is astute enough to recognize that. Never mind the funny answers. Try to give us straight answers, because I think it will be helpful in the process.

For example, on the issue of the viability criteria, which was item number three, I believe it is, which would determine which schools will remain one denominational, or uni-denominational, as the government calls it. Now, in last week's proposal you said: Viability criteria will be established by government after further consultation.

Mr. Speaker, I'm sure the minister would know there is a world of difference between being established by government after consultation and being established by agreement between the two sides. I want to ask him: Is the government prepared to negotiate specific viability criteria, and is he then prepared to include that criteria as part of any formal document of agreement that you might reach with the churches?

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

MR. DECKER: Mr. Speaker, the hon. member will know that it is possible to make any school in the world or any school on the moon viable. If we are prepared to put the extra resources in, the distance education and all the modern technology, we can put a classroom on the moon for three children and make it viable. That is possible. It costs an enormous amount of money.

When we deal with viability we will be looking at the ability of a school to deliver X number of courses, to deliver the program. We will be looking at the impact of one school on another. For example, you can take all the children from school A and bus them to school B, and you have school B which is viable but you've made school A unviable. If you are prepared to bus thirty-five and forty miles you can make a school on Signal Hill viable. It is no trouble to make a school viable.

In our letter to the churches we've said after further discussions; we will discuss this with the churches. We will discuss this with the Newfoundland and Labrador Teachers Association. We will arrive at an absolute standard that constitutes viability in a school. Then we look at the Province, okay? We have absolute viability regulations in place. If two schools are side by side, both of which are unviable, before putting extra teachers into each of these schools, or before putting distance education in these schools, we will encourage these two schools to come together, because sometimes coming together you could have one viable school where we have two unviable schools.

We recognize that a place like Harbour Deep and Red Bay and parts of Coastal Labrador, parts of the South Coast, they cannot be viable because the communities are isolated, so you need something extra. We will only put the extras into a school to make it viable when we have used up all the options about consolidation. We do not consider that the denominational component of a school contributes to its viability. That is where one of our problems will indeed be with the churches. Some of the churches - not all of them - are suggesting that when you have all the viability criteria in place you also have to put a denominational aspect. We don't accept that.

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

MR. SIMMS: Mr. Speaker, I appreciate the information the minister is providing to the House. It had nothing to do with the question I asked him.

MR. DECKER: I thought it was good.

MR. SIMMS: Yes, you thought it was good, but the question was: Will you include that viability then, or that criteria that you reach agreement on, if you do reach agreement on it, as part of the official document?

MR. DECKER: Oh, oh!

MR. SIMMS: Okay, well, that was the question. You could have said that in two seconds. Let me ask him a further supplementary, Mr. Speaker. Since he has raised the other issues, this other issue, specific issues about schools, denominational schools, and what is viable and all the rest of it, let me ask him a couple of other ones.

Specifically - because in addition to meeting the viability criteria, he would know in his document that `uni-' or one denominational schools must also be approved by parents. That is what he says in here. Now, in large communities where there are several schools, which he talked about a moment ago, the requirement in his document is that sufficient parents from the community must indicate a desire to have such a school.

I want to ask him two questions I guess on this point, if I might. What percentage of parents in this case would be deemed to be sufficient? Secondly, would this place unfair restrictions on certain students? For example, would a Roman Catholic school in Grand Falls - Windsor - the area I know best - still be able to accept a student or students from Badger, for example, if the community of Badger decided it was going to have an interdenominational school, but these RC students in Badger still wished to attend the school of their choice in Grand Falls - Windsor? Would that school in Grand Falls - Windsor be able to accept them under these rules?

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

MR. DECKER: I will explain this for the hon. member. It is an excellent line of questioning, I'm glad he is putting it forward.

Let me use an example of two Catholic schools in St. John's, Brother Rice and Gonzaga. If we went to both of these schools and asked the parents of the students attending that school: Do you want this to be `uni-' or do you want it to be `inter,' most likely we would not reach the 90 per cent clause. So you would end up with these two Catholic schools today ending up being two interdenominational schools.

Rather than do that, where you have sufficient numbers of people in St. John's to have separate viable uni-denominational schools, the logical thing to do would be to take one of these schools, and all of the people who want to attend a uni-denominational school could attend, say, Brother Rice - Gonzaga then, or Brother Rice, whichever the parents chose - would become a uni-denominational school, a Roman Catholic School.

Now, students attending that school would know full well that it is a Roman Catholic School. If a Protestant child attended that school, he or she would know that he or she is attending a Catholic school, and it would stay a Catholic school.

The other problem we have is in rural areas. Take a place like Trepassey, where the population is predominately Roman Catholic, then the parents would have the option of asking to make it uni-denominational.

The reason we bring the parents in is this: The churches could say: We believe Trepassey should be a Roman Catholic school. The government might say: Maybe you're right; maybe you're not, but we would go to the people of Trepassey and say: Look, the churches have said you should be uni-denominational; what do you say? If the parents say, `yes', then it would become a uni-denominational school.

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

MR. SIMMS: Mr. Speaker, on the same line of questioning, since he has raised the Trepassey example, in a situation where there is only one school in a community, for example, his document says, it requires the consent of at least 90 per cent of the parents for that school to remain as a one-denominational school.

Now, on the Southern Shore, for example, all the schools on the Southern Shore, pretty well, are Roman Catholic - in fact I think they all are - and by far the majority of the population is Roman Catholic. Now consequently there hasn't been and never will be, I guess, any duplication of services and costs; yet the Roman Catholic schools in that area, as I read it, could be eliminated if as few as 11 per cent of the parents voted for an inter-denominational school.

Now there doesn't seem to be any rationale for that, so I would like to ask the minister if he could explain: Why should 11 per cent of the parents override the wishes, say, of 89 per cent or 90 per cent, especially when there is no duplication of services or costs?

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

MR. DECKER: Mr. Speaker, I must say, these are the most sensible questions I have heard about education since I have been Minister of Education.

Here is the situation. The concept of the neighbourhood school is the way government is going. Take the school, for example, in Trepassey. Every person who lives in Trepassey has the right to attend that school. If it were possible to bus the Protestants out, we would not do it because we are not going to bus children from a viable school.

So here is the government on one hand saying, all the children who live within a reasonable distance of that school are eligible to attend that school. Now how does it shake out? When the school shakes out, all the people in the neighbourhood, all the people in the community, have the right to attend. What do you have?

If you have half Protestant and half Catholic, then I don't think the decision is too difficult to make; it becomes inter-denominational. Seventy/thirty - should you let it be all Catholic? Ninety/ten? I don't know, and I will confess, I am not sure that 90 per cent have the right, but you have to recognize that the minorities do have some rights, and the whole basis of denominational education recognizes the rights of the minority.

So if the government is saying, on the one hand, to 10 per cent of the Protestants in Trepassey: You must attend that school, then I am not sure we have the right to say: You must attend a Catholic school, whether you have or not, so that is why, you see.

I am not tore up on the 10 per cent, but that is what is behind it.

MR. SPEAKER: The hon. the Member for St. Mary's - The Capes.

MR. MANNING: Mr. Speaker, my question is for the Deputy Premier.

The Institute of Social and Economic Research at Memorial University has received a $1.4 million grant to study the effects of the groundfish moratorium on rural Newfoundland. Why does the provincial government support this study, and has the Province provided any funding for the study, in addition to the federal grant?

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

MR. BAKER: Mr. Speaker, I understand that this particular group, or the particular professor, has applied to the federal government, received a grant under ACOA. As far as I know, there are no applications in to the provincial government and we have not provided any money.

MR. SPEAKER: A supplementary, the hon. the Member for St. Mary's - The Capes.

MR. MANNING: The Executive Director for the study, Professor Rosemary Ommer was interviewed by the Globe and Mail about the future of outport communities. She talked about the need to train people to run bed and breakfast establishments for tourists.

I quote: To understand, it is really necessary to have towels and hot running water, and I repeat: To understand, it is really necessary to have towels and hot running water in rural communities. Well, I am from rural Newfoundland and we have had both for a very long time.

How can any person with such ignorance and prejudice do a legitimate study of rural Newfoundland, supported by $1.4 million of taxpayers' money? Are we spending the $1.4 million to educated Professor Ommer?

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

MR. BAKER: Mr. Speaker, the hon. member has expressed his opinion. I don't know the details of the study; I don't know the background that obviously the hon. member has, so I feel unable at this point in time to make a definitive statement on it. We have not supported that particular study as far as I know and -

AN HON. MEMBER: Doug House (Inaudible).

MR. BAKER: Well, they may have, I don't know, but we have not, we have had no such request that I know of, Mr. Speaker, and that's all I can say about it.

MR. SPEAKER: A final supplementary, the hon. Member for St. Mary's - The Capes.

MR. MANNING: Mr. Speaker, Doug House of the Economic Recovery Commission has supported this study, and Professor Ommer's comments to the Globe and Mail perpetuates a stereotype about Newfoundlanders. If she isn't showing her own prejudice, then she is playing to the prejudice of the mainland media.

I ask the Deputy Premier, will he demand that Ottawa withdraw funding to this project and the insult it is to rural Newfoundland?

SOME HON. MEMBERS: Hear, hear!

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

MR. BAKER: I must say, Mr. Speaker, that I was as appalled as the hon. member with that particular story in the Globe and Mail and some of the comments attributed to individuals. I don't really know if the individuals actually made the comments, I have never bothered to check that out, therefore, again I hesitate to do a condemnation unless I have all the facts. It is just not my way of doing things but, Mr. Speaker, let me hasten to add that the kind of attitude displayed in that Globe and Mail editorial is something that we can well do without.

MR. SPEAKER: The hon. the Member for Humber East.

MS. VERGE: Thank you, Mr. Speaker.

I have questions about Tourism and Culture. Since there is no Minister of Tourism and Culture and the acting minister is away and the Premier hasn't arrived in the House yet this afternoon, I will direct my questions to the Deputy Premier.

The 1994 Rand McNally Road Atlas for North America, lists major tourist attractions in the United States and Canada. Eighty-seven US and ten Canadian attractions are highlighted, one in Newfoundland and Labrador and that one is the Stephenville Festival. Why has the provincial government, by cutting $35,000 a year in provincial funding last year, by ignoring responsible proposals for better administration of the Stephenville Arts and Culture Centre, and by silly, needless hassles, caused the Stephenville Festival Board to decide last week to cancel the 1994 program?

MR. SPEAKER: The hon. the Minister of Employment and Labour Relations.

MR. GRIMES: Thank you, Mr. Speaker.

Again, I appreciate the question but I think it seems fairly obvious from the tone of the question and the kind of language that was used that the hon. member opposite made it all up herself because none of that language or tone has come from anyone involved with the Stephenville Festival in dealing with the provincial government.

They have been quite pleased with the efforts between the festival organizers and ourselves; they did operate last year with the tourism marketing grant decreased from $35,000 to $17,000; they found other ways to continue to function, they were working with officials in the department, in several departments actually, of the government and everything was in expectation that there would be a festival again this summer.

The board, for its own very good reasons, felt that on the basis of all the information they had and all the prospects that they had for this year, that despite the fact that they would like to have the festival, they felt it is in everybody's best interest to use a year to regroup, to reorganize themselves to deal with some of their significant accumulated debt over the years, and they think it is in everyone's best interest to just take a year off to reorganize so that they can put the Stephenville Festival back on the road, so it will again be like it was as the hon. member indicated, one of the attractions that is listed in many publications in North America and one of the things that draws people regularly to the West Coast of Newfoundland.

MR. SPEAKER: The hon. the Member for Humber East.

MS. VERGE: Thank you, Mr. Speaker.

I say to the Minister of Employment and Labour Relations, it is in nobody's best interest for the sixteenth annual Stephenville Festival to be cancelled.

Mr. Speaker, the government's much bragged about Strategic Economic Plan identifies tourism and culture as among the very few economic growth potentials for this Province, and the report specifically cites the Stephenville Festival as a major tourist attraction on which to build. Will the government act immediately, and I mean today, to give the Stephenville Festival Board the support they require to salvage the 1994 season so this Province can have the economic benefit anticipated by the Strategic Economic Plan, and so that Newfoundland and Labrador can deliver the one and only tourist attraction listed in the 1994 Rand McNally Road Atlas billed as America's number one seller?

MR. SPEAKER: The hon. the Minister of Employment and Labour Relations.

MR. GRIMES: Thank you, Mr. Speaker.

It is unfortunate that the hon. member again persists, as she does, when this is really not the issue she is trying to make it out to be, in the context she is trying to make it out to be. There is a problem that the board of the festival itself has recognized and they came to the decision that it was in the best interest of everybody involved with the Stephenville Festival to regroup and reorganize so that even though the unfortunate initial outcome is that the 16th annual Stephenville Festival does not run, they do not want to jeopardize the 17th up to the 170th. They would like to put it on a firm foundation so that it can in fact contribute, like it does, artistically and culturally, and to the tourism potential value in that part of the Province, because a lot of Newfoundlanders and Labradorians have taken a real interest in the Stephenville Festival, and were looking forward to the release of their program for this year, and not to an announcement that it was cancelled.

The kinds of reasons that the hon. member is trying to put forward, that there has been haggling between the festival organizers and the government, and that it is because of the cutback of $17,000 in a $400,000 budget, that is not the kind of arrangement that caused the festival to be cancelled. There are other initiatives that the government and the festival organizers were working at in terms of trying to make sure that the festival was on a firm foundation. They felt, with no pressure from government, whatsoever, that they would make the best decision at this point in time, which was to cancel for this year and to put it on a firm foundation so that next year, and every other year, there could indeed be a Stephenville Festival running again.

MR. SPEAKER: A final supplementary, the hon. Member for Humber East.

MS. VERGE: Mr. Speaker, what a bluff.

SOME HON. MEMBERS: Hear, hear!

MS. VERGE: Mr. Speaker, each season the Stephenville Festival has employed between forty-five and fifty-five people. If the 1994 Stephenville Festival is cancelled about fifty seasonal jobs will be gone, as well as the spin-off benefits for the service businesses of the Bay St. George region. Will the government make the relatively small effort - small effort, required to salvage this season for the sake of the economy and jobs? Jobs, I say to the minister responsible for employment.

MR. SPEAKER: The hon. the Minister for Employment and Labour Relations.

MR. GRIMES: Thank you, Mr. Speaker.

I can hardly answer the question I am that hurt. My feelings have been hurt that much with that first comment that I can hardly answer the question.

Again, so that everybody would know, this a very serious matter and we deal with it seriously and not in the manner that the hon. member opposite does in asking the questions, with a lot of rhetoric and a lot of hot air, and so on. That does not impress anybody. It might impress herself but it certainly does not impress anybody involved with the government, and I do not think it impresses anybody involved with the Stephenville Festival.

In fact, Mr. Speaker, there have been opportunities investigated for a couple of years now whereby the organizers of the Stephenville Festival in concert with the government could access additional money, but for their own reasons they have not done that. There are other proposals that have been looked at to try to make it possible for them to operate on a better basis than they have so they can improve their financial situation and so that in fact the festival could continue to provide the economic spin-off that it does, provide the tourist attraction that it does, and continue to be listed as a tourist attraction in Newfoundland and Labrador.

Mr. Speaker, unfortunately at this point in time, with their own information, and because of their own decision, made on a very firm basis from their own point of view, they have decided that they should not operate this year so that they can regroup, put it back on a firm foundation, make sure that the Stephenville Festival operates for at least another fifteen or twenty years, and we will see where it goes from there.

Thank you, Mr. Speaker.

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

MR. SULLIVAN: Thank you, Mr. Speaker.

I would like to direct a question to the Minister of Health. Advertisements have been appearing in newspapers across Canada for a chief executive officer for the new regional hospital boards and community health boards. I ask the minister, what would be the salary range for those positions?

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

DR. KITCHEN: Thank you, Mr. Speaker.

MR. SPEAKER: Order, please!

I can't hear the hon. minister.

DR. KITCHEN: Mr. Speaker, offhand, I don't have those figures but let me say that each of these positions, I think, has been tentatively evaluated by the people in government who do these evaluations on the HAY Plan. The salary - it has been advertised that it fits into this HAY system, but offhand, I can't give you the range for each of the positions because the positions vary, some are larger than others.

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

MR. SULLIVAN: Thank you, Mr. Speaker.

Some of the advertisements indicate it is according to the HAY Plan but the one in the Globe and Mail for chief executive officer did not indicate it is according to the HAY Plan at all. In fact, remuneration will reflect the single nature and responsibilities associated with the position and it hasn't specified.

Now, there will be seven hospital boards and five community boards if we follow the current plan of government - there are some combinations of both. How many executive, administrative and support staff will be hired by those boards? Will there continue to be executive and management staff for each institution that now comes under the jurisdiction of the regional boards? In other words, will there be more or fewer administrators in this new system?

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

DR. KITCHEN: Thank you, Mr. Speaker.

Mr. Speaker, one of the main reasons for combining the boards and making fewer boards is to eliminate administrative positions. By combining boards, the person who becomes the chief executive officer of the larger board has a bigger individual responsibility than either of the people that he or she would replace and consequently, it is normal to pay them a little more but it is hoped that there will be a reduction in the number of management positions throughout the whole system as a result of this combination, and not only management positions but other combinations where there is overlap. We are trying, as best we can, to preserve the front line health care workers in hospitals and nursing homes and in order to do it, within the given financial situation we find ourselves in, we have to combine boards and eliminate positions that are overlapping.

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

MR. SULLIVAN: Thank you, Mr. Speaker.

I have seen an increase in the budget for health but I've seen a decrease in hospital beds and front line workers. The minister is implying that hospitals now each have an administrator and when we get a chief executive officer we are going to eliminate some of the administrators at the institutional levels, that's what the minister is stating. Surely, by now, government has done a cost benefit analysis for the new system. We have most of the boards in place. Can the minister tell the House whether administrative costs will be lower or higher under the new regional boards? Will he table an analysis which compares estimated costs under the new board with costs that are currently being incurred now under present boards?

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

DR. KITCHEN: I can assure the hon. member, Mr. Speaker, that the administrative costs under the new arrangement will be less than the old costs. We have not and will not carry out detailed studies at this point because a lot depends upon when the boards are in place and their chief executive officer is in place. They have then to decide which positions they will eliminate, which ones they can combine, which ones they'll eventually atrophy and so on, these are things which will be there. We know, it's obvious to anyone with a grain of sense that there will be savings. You don't have to say that there will $1,000,017.23 which is what the hon. member wants but we do know that there will be savings and I challenge anyone to say that there won't be. Thank you.

MR. SPEAKER: Order, please!

The hon. the Member for Baie Verte - White Bay.

MR. SHELLEY: Thank you, Mr. Speaker.

I have some questions for the Minister of Forestry and Agriculture. I started on Friday asking some questions of the acting minister, the Minister of Health. I'm sure that the minister now can expound on some of those questions.

Some time ago the government announced it was actively pursuing the privatization of Newfoundland Farm Products. I'd like to ask the minister, how far along are you with those preparations to sell that particular Crown corporation?

MR. SPEAKER: The hon. the Minister of Forestry and Agriculture.

MR. FLIGHT: Mr. Speaker, I suspect that the answer coming from the hon. the Minister of Health on Friday, since the member indicated, is probably adequate and probably provided the information that the member needs.

I would simply say to him that we are in the process. We've called for expressions of interest probably a month ago. There has been considerable interest up to this point in time. A number of corporations or individuals representing corporations have indicated a desire to make a proposal to the Newfoundland government with regards to privatization. That is the process we are into.

I would presume that the proposals we are receiving, or have received, are being processed and looked at.

AN HON. MEMBER: Oh, oh!

MR. FLIGHT: Shortly, yes, we will get it pretty soon. The whole thing is being done under the auspices of Treasury Board, Mr. Speaker, with regard to the financial aspect. It is an ongoing process and sooner or later we will expect to be able to privatize Newfoundland Farm Products.

MR. SPEAKER: A supplementary, the hon. the Member for Baie Verte - White Bay.

MR. SHELLEY: Thank you, Mr. Speaker. Maybe I will ask my next question of the President of Treasury Board. I believe that there is a general support for the privatization of Newfoundland Farm Products. The principle concern is that the company may be sold to out-of-Province interests who may then shut it down and supply the consumer market here with out-of-Province produce. What steps will the government take to ensure the company will continue to operate in this Province?

MR. SPEAKER: The hon. the Minister of Forestry and Agriculture.

MR. FLIGHT: Mr. Speaker, obviously the member can fantasize all he wishes. In one breath he says he supports the concept, and then he gets up on a flight of fantasy as to what might happen. Maybe we will get an iceberg and move Newfoundland Farm Products and operate it from an iceberg.

We are going on the basis that it is right to privatize Newfoundland Farm Products. It will be privatized in a way that protects the interest of the established producers in the Province, and there is no basis for the silly concern just expressed by the hon. member.

SOME HON. MEMBERS: Oh, oh!

MR. SPEAKER: Order, please!

Question period has elapsed.

Answers to Questions

For which Notice has been Given

MR. SPEAKER: The hon. the Minister of Employment and Labour Relations.

MR. GRIMES: Mr. Speaker, I would just like to table brief answers to questions asked on Thursday past, April 28, by the hon. the Member for Ferryland, with respect to tour boat operators and whether or not there would be a licensing system put in place and some safety standards, and also comprehensive liability insurance.

Just to point out, in tabling the answers, there had been a meeting scheduled for yesterday, Sunday, May 1, between tour boat operators, Hospitality Newfoundland and Labrador, and officials from the Department of Tourism and Culture prior to this issue, because it had been raised in the department by the existing tour boat operators a week or so ago.

The issues were addressed. It has been agreed that the tour boat operators, the industry association and the department will work together to try to make sure that the issues of licensing - which are currently covered under the Coast Guard regulations - anything to do with onshore loading and off-loading and those types of issues will be dealt with, along with the industry, the department and the operators trying to put in place a standard and rating system. Also, the operators working with Hospitality Newfoundland and Labrador will determine the most appropriate way to ensure that all tour boat operators carry appropriate levels of liability insurance.

Those are issues that had been under discussion. The discussions are continuing, Mr. Speaker, and I table these answers to those questions.

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

MR. LUSH: Mr. Speaker, on Friday, the hon. the Leader of the Opposition posed questions related to the changes in the U.I. regulations and with respect to the fisheries package and what impact they may have on social services, and whether or not there might be a revised budget.

In answering the question of the Leader of the Opposition, I said at the time that in projecting these figures the officials consider the economic situation at the time and all of the trends, in particular with social services looking at the growth in the caseload. I say to the Leader of the Opposition that the situation re the U.I. was known to the officials, and with respect to the fisheries that it was considered in the global consideration, although the specifics weren't available. In that sense both were considered in the global consideration, with respect to the economic situation, but specifically the U.I. situation was addressed.

No, Mr. Speaker, at this point in time we are not anticipating any revision in the budget figures.

Petitions

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

MR. A. SNOW: Thank you, Mr. Speaker.

I am pleased to have the opportunity to rise and present a petition on behalf of several residents of Western Labrador who have signed the petition and asked that it be presented to the House of Assembly.

The prayer of the petition says: `Wherefore your petitioners urge the Government of Newfoundland and Labrador to stop immediately the privatization of Newfoundland and Labrador Hydro and hold a referendum to ask the people of Province their views.'

Mr. Speaker, the people of Western Labrador who have signed this petition are very concerned about the privatization of Newfoundland and Labrador Hydro and how it is proceeding down the rails on the sale of their Crown corporation. These petitions were collected by a committee that was struck from a public meeting that I organized in Western Labrador. The petitions continue arriving at my office because they had presented them throughout the community and then people were mailing them in.

The people of Western Labrador have a right to be even more concerned than the general public of the rest of the Province of Newfoundland and Labrador in a sense that they are the highest per capita users of electricity in a municipality. By the nature of their geography, by the nature of the demographics of the community and how they've changed from oil-fired to electric furnaces and electric baseboard heating in the houses, and also by the fact of climatic conditions, these things ensure that they must even today have to plug in their cars in order to start them to be able to go to work in the mornings. We still have temperatures down to -20 C in the month of May.

In light of the irrational statements made by people such as the Minister of Health - suggesting that the people of Western Labrador should face huge electrical increases of up to 500 per cent, he says they should be charged - these irrational statements don't do anything to help ease their minds about a government that should have concern for them, and direct the Crown corporation not be sold and that the Crown corporation would charge a reasonable rate, and a reasonable rate increase would only be given to people who consume this amount of electricity, any electricity in this Province, Mr. Speaker, but a 500 per cent increase, as proposed the Minister of Health, is completely unreasonable and so would be the 300 per cent as suggested by the Premier.

Now, Mr. Speaker, we've even had some of the people outside Cabinet, such as - some of the want-to-be's, Mr. Speaker, that want to be in Cabinet, such as the Member for St. John's South who has suggested that the electricity rates in Western Labrador have been subsidized. Mr. Speaker, there is nothing further from the truth then the fact that they have been subsidized in their electrical rates. They have not been subsidized. The rates in Western Labrador haven't been subsidized. The private utility -

MR. MURPHY: (Inaudible).

MR. A. SNOW: Well, one of the want-to-be's in Cabinet - the Member for St. John's South suggested that the electricity rates in Western Labrador were subsidized.

MR. ROBERTS: They are not bearing their share of the subsidy that (inaudible).

MR. A. SNOW: But they have never been subsidized and the Minister of Health - I noticed that the Minister of Justice, the Government House Leader, conveniently wouldn't respond to what the Minister of Health suggested, that the people of Western Labrador should be paying 500 per cent more, should have to endure -

MR. ROBERTS: (Inaudible).

MR. A. SNOW: But do you agree that they should be?

MR. ROBERTS: The Public Utilities Board will decide what is fair.

MR. A. SNOW: But does the Government House Leader suggest that the people of Western Labrador have to pay 500 per cent more for electricity?

MR. ROBERTS: What I'm saying is they should pay what the Public Utilities Board proposes. (Inaudible).

MR. A. SNOW: Mr. Speaker, the people of Western Labrador fear that the Public Utilities Board may indeed allow a 500 per cent increase - forced down their throats, Mr. Speaker.

AN HON. MEMBER: (Inaudible).

MR. A. SNOW: I don't know, maybe they were given direction by the Cabinet. I don't know why they would do it. I don't know why and I don't know the rationale why the Minister of Health and the Government House Leader want to charge the people of Western Labrador 500 per cent more for electricity, Mr. Speaker, I don't know why he wants to do it. I honestly don't know - and neither do the people of Western Labrador understand why this government wants to first of all come in and take over the utility company. They asked the Hydro Corporation to come in and take it over and now, Mr. Speaker, they decided to sell it out again to the private sector. So, I mean, they don't know which way they're going. That's exactly what's occurring and that's what scares the people of Western Labrador. They're afraid that they may indeed have to endure a 500 per cent increase which would be exorbitant in anybody's books, denoting the high amount of consumption of electricity that the people of Western Labrador have to use because of where they're living, because of the climate, Mr. Speaker, and because of -

MR. SPEAKER: The hon. member's time has elapsed.

MR. A. SNOW: I would ask that government reconsider their position -

MR. SPEAKER: No leave.

MR. A. SNOW: - and not continue with the privatization of Newfoundland and Labrador Hydro. Thank you, Mr. Speaker.

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

MR. SULLIVAN: Thank you, Mr. Speaker.

I rise to support my colleague's petition from constituents of his district against the privatization of Newfoundland and Labrador Hydro.

Now, the Premier, from day one, for many years, has had as his pet project, the privatization of Newfoundland Hydro. He has tried to do it in a way that would sort of hoodwink the people of this Province. The whole scheme has been exposed now and the chances of getting public support are dwindling by the day. He has now resorted to going outside the Province, to bring in people from outside the Province, to speak here to convince people in this Province what's best for them.

Now, he wasn't very successful in getting Wade Locke, who the Minister of Mines and Energy described as not knowing anything. I'm not sure the word he used to describe him, it wasn't very complimentary - and he doesn't have his facts right, his numbers aren't correct. Well, the government hasn't provided any numbers otherwise to show the positive effects of privatization. The only thing the government has been prepared to show is that we will have to borrow less money and therefore we'll have less costs on retiring that debt over the lifetime of that debt, whether it's forever or whatever the case may be. What they failed to realize is that there is a negative side on that balance sheet and the negative side is very, very substantial, far more significant then the amount that we're going to save by not financing the debt. Now we know that Hydro makes a profit of anywhere from $14-$16 million a year. This past year, I think, almost $14 million, $16 million the year before, when you exclude the Upper Churchill. So let's look at the portion that's now up for sale. On top of that $14 million - $16 million that we are turning over in profit to the people of this Province or to keep down other borrowing costs or to keep down the rate of electricity, we're going to put on another $10 million in guarantee fee we're going to give up by putting it in privatization, and when you look at the rates that electricity is going to increase, when you take all the associated costs with privatization, depending on the figures provided by Wade Locke, and if you take the conservative end of those figures, it is going to be in the tens of millions of dollars - possibly $40 million, maybe as high as $70 million are some of the costs. So the bottom line, when you weigh the positive side against the negative side, we are going to be down $40 million, or $50 million, maybe higher.

Why would anybody want to sell a company that is paying its debts, turning a profit, and keeping the cost of electricity down for the people in this Province? It just doesn't make sense.

Peter Boswell now has changed his view. Anybody who has access to all the figures and costs is starting to change his mind. I am sure John Manuel, who is Chairperson of the Advisory Council on the Economy, who works very closely with Premier Wells, has come out trying to get Boards of Trade, Chambers of Commerce, to support it. The largest in the Province has voted against it, so we are finding that it's just not working. We might as well give up the fight. You are either going to force it through, because you are never going to change people's minds - they are becoming entrenched; they haven't been told the whole truth at all - people are being insulted by not being told the truth, along with having no positive reason, from a financial perspective, why they should privatize. So they are two very valid reasons, the cost, of course, being most important, and an insult, really, to the integrity of the people of this Province is another one.

And they are trying to throw out now, in the public forum, that if we don't privatize now, our credit rating might go down. Our credit rating may very well go down, or remain the same if we never privatize. The economic outlook is negative, even with or without privatization, so don't use that scaremongering tactic that the accused Opposition are using in the privatization of Hydro. That is one the government is using. They had a member stand up and ask a question in the House, the first time I have seen it since I came into the House, that a member on the government side - they have every right - to try to throw out into the public view, and to scaremonger, and try to show that this could have an adverse effect on our credit rating, when the economic outlook is negative without that. Those are some of the things that people don't take too kindly to.

They have indicated it's going to open up the doors to great economic opportunities for this Province. Yes, we can see a privatized Hydro. They are going to come knocking on our doors, and we are going to have hustle and bustle all over this Province. Well, that is a myth. That is not going to happen. We have to set up and establish a proper climate for business in this Province.

This government went through a period of increasing taxes after taxes, upped the corporation tax 17 per cent, dropped it back again.

MR. SPEAKER: Order, please!

The hon. member's time has elapsed.

The hon. the Government House Leader.

MR. ROBERTS: Mr. Speaker, I would like to say a word or two, if I might, in respect to this petition. I won't attempt to answer the peculiarly paranoid delusions of my friend, the Member for Ferryland, because he has long since departed this realm into flights of fantasy, but I would like to say a word about the comments of my friend, the Member for Menihek. I want to make a couple of things clear.

In this Province it has been the case, and as long as this administration is in office it will continue to be the case, and I venture to say no administration will ever change this, the price of electrical power is set by the Public Utilities Board - that is point one. Point two, the board does not take direction from the government, as he said here in the House. The board neither seeks nor accepts direction. The government neither wants to give direction, nor would be party to a response if a request for such help came.

AN HON. MEMBER: (Inaudible).

MR. ROBERTS: Look, my friend, the Member for Ferryland is irrelevant to this. We are talking about serious stuff. I am talking about my friend, the Member for Menihek now.

The Member for Menihek said that perhaps the government had given direction to the Public Utilities Board, or would give direction. He used the word `direction'. The government do not give direction. We have not been asked for it. If asked, we would not respond. We have no right to give direction. The price of electricity will be set in the future as in the past, by the Public Utilities Board, which is an independent board with tenure that holds office under legislation, that functions in a quasi-judicial sense, a quasi-judicial role subject to an appeal to the court of appeal in the appropriate circumstances, and sets prices in accordance with the rules laid down in the Public Utilities Act and that act has stood for many years, and the new Electrical Power Control Act which in this respect is essentially the same legislation as is now on the books and has been on the books, again, for a number of years. So I would say to my friend, if any of his constituents has any illusions or delusions or fears about a 500 per cent increase because of some direction of the government, they are completely unfounded.

Now, will there be a 500 per cent increase? I don't see how that could come to pass, because what will have to be done when it comes to set the rates for power in Western Labrador, or for that matter in my district, in the Upper Lake Melville area, will be to look at the cost of the power which comes from the Upper Churchill Development, to look at the cost of delivering that power which is the same throughout the Province on a per unit or per capita cost in my understanding and then, this is where the increase will come, to add in what has not been there hither to, which is the rural subsidy.

The people of the Island are paying a share, each in our proportion to the cost of the subsidy in the diesel areas. The people of Labrador are not paying anything towards that, and in my judgement, and I believe the people of Labrador being fair-minded people will concur, they should pay their fair, proportionate share. That won't be a 500 per cent increase; it won't be a 100 per cent increase. Now my friend wanted to ask a question -

AN HON. MEMBER: (Inaudible).

MR. ROBERTS: I beg your pardon?

AN HON. MEMBER: How do you compute the cost of the electricity?

MR. ROBERTS: The cost of electricity is computed by the cost of generating it and delivering it to the point of return and - I don't know what the board would do - the most they would do is look at the cost in Labrador where we have an interconnected grid running from Western Labrador through to Happy Valley-Goose Bay, and in each case power coming from Churchill. If my friend is suggesting that there would be a common Province-wide base, I could only say that would be the first time ever and it would be a most, most, amazing result in my judgement. I don't know what the board would do of course, but I find it difficult to conceive the board would.

The cost of power in Labrador is the cost of generating it in Churchill and in moving it across Western Labrador to his constituency and across Central Labrador to the east to my constituency. The other people in Labrador use power generated by diesel-electric generation so, I would simply say to my friend that while he has every right to say what he wants, and I don't fault that, he is really barking up the wrong tree if he believes that there will be a 500 per cent increase because of privatization or anything; there will not be that kind of increase in my judgement for the reasons I have given and more to the point, the increase will come, whatever it is, and we have offered the view that it may be as much as five or ten mils in our estimate, but it is only an estimate, will come whether Hydro is privatized or not. The only reason it hasn't come hitherto is, Hydro, as a corporation held off making an approach to the board to ask them to set the rate in Labrador until these issues are resolved. Well the issues will be resolved sooner or later, Hydro will make its approach, the raise will go through no matter who owns the share interest in Hydro.

Now I make that, Mr. Speaker, not in relation to the thrust of the petition, which of course I do not accept, I do not agree with, but in relation to the incendiary remarks of my friend, I have no quarrel with his right to object to what we do, but equally, I think he will acknowledge that we must be sure we don't mislead people and I am sure he was doing it unknowingly, but in my view, his remarks left an incorrect and a wrong impression.

Thank you.

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

MR. FITZGERALD: Thank you, Mr. Speaker.

I rise today to present a petition on behalf of some residents from Baie Verte - White Bay, St. John's North, residents of Kilbride and other areas of St. John's. The petition reads:

WHEREFORE the undersigned, your petitioners, humbly pray and call upon Parliament to demand the Government of Newfoundland and Labrador not privatize and sell Newfoundland and Labrador Hydro, and ensure that Newfoundland and Labrador Hydro remains a Crown corporation.

Mr. Speaker, time and time again, we have seen people come forward here to this House and demonstrate on the steps of the building, in the foyer of the building here, people coming in and speaking out, opposed to the sale of Newfoundland and Labrador Hydro. People are continuing to voice their frustrations, voice their concerns about what might happen if this Crown corporation is privatized.

In the beginning we were told that the legal opinions of the day were that privatization was a good thing, it was a positive thing, it was something with which we should go ahead, but as time progresses, Mr. Speaker, we continually see people with a great knowledge of privatization and a great knowledge of the legal opinions of businesses come forward and saying it is not such a wonderful idea, that the privatization of Newfoundland and Labrador Hydro is not the great and wonderful thing that government members put forward as something that should happen.

Mr. Speaker, as we have waited over this past number of months we have been looking forward to the facts and figures coming forward to show us, and convince us, that a privatized Newfoundland and Labrador Hydro would be of great economic benefit to this Province of Newfoundland and Labrador, but those figures have not been forthcoming. Figures that are put forward by this side and by other people who are not in favour of the sale, Mr Speaker, are continually shot down as being false, we are fearmongering, it is not the right figures, but people are asking, and, I guess, pretty soon will be demanding that the real figures that government is basing their opinions are be brought forward so that people can see for themselves why it is that this government is so anxious in privatizing a Crown corporation.

Most of the polls that have been conducted in the past, Mr. Speaker, have shown as well that approximately 80 per cent of the people in Newfoundland and Labrador are opposed to this sale, opposed because they do not have enough information, they do not have enough information about the wonderful things that might happen if it is privatized by what government is putting forward and saying.

Mr. Speaker, we have always been told that our credit rating would improve and we would be able to get much more money for much lower costs. I think if you read the reports put out by several of the credit rating agencies you will find that those reports are unfounded as well. People are questioning why we want to privatize this Crown corporation, something that is ours, something that is continuing to turn in revenue to the government. They ask government to lay this piece of legislation aside and get on with the business of the day, to get on dealing with the problems that are out there in rural Newfoundland and Labrador, and deal with the common issues, the every day issues, that affect our people.

Mr. Speaker, in conclusion I plead with the government to lay this piece of legislation aside, put it aside, and get on with the business of running government, and let this Crown corporation continue to exist and operate in the efficient manner as it has done in the past.

Thank you, very much.

MR. SPEAKER: The hon. the Member for Humber Valley.

MR. WOODFORD: Thank you, Mr. Speaker.

I would like to support the petition presented by my colleague on the privatization of Hydro. There is no question in my mind, and it is obvious from some of the petitions that have been presented here in the last number of weeks, that the majority of the people of the Province, and looking at some of the polls that were done in the last month or so, the majority of the people of the Province are against the privatization of Newfoundland and Labrador Hydro.

Mr. Speaker, whether the people of the Province are familiar with the exact repercussions, the consequences, or what have you, of the privatization of Newfoundland Hydro, whether or not they are, or whether or not they are cognizant of what will happen after, or what has been happening with Newfoundland Hydro, or what effect it will have on the debt of the Province, and so on, the credit rating or whatever, the fact is, in this instance, that the majority of the people of the Province are against it. It is obvious that if the majority of the people of the Province are against it, it is for a reason, and one of the big reasons I am finding around the Province today is the lack of information, the lack of information available.

Now, most legislation passes through this House with the people of the Province knowing very little about it. It is one thing for it to pass through the Legislature without a public hearing, or without it going to committee, but it is another thing for a substantial piece of legislation such as this going through without any hearings at all.

Will the privatization of Hydro cost Newfoundlanders and Labradorians more? Yes, Mr. Speaker. That is even admitted by the Premier and members opposite, it will cost more. The figures and facts put forward by members opposite in their analysis of the rate increases over the next five years, as far as I am concerned, just do not wash with me. Based on the facts and figures of just a few short years ago it is going to cost the people of this Province a substantial increase, far more than what is recommended and what is documented by members opposite in their piece of correspondence that has gone around to the people of the Province. That it is going to cost them far more.

The big thing, Mr. Speaker, is that they are going to lose one of the biggest and best assets that this Province has ever had, ever will have. They will lose complete control over the generation of electricity in this Province forever and a day. Newfoundland Hydro generates - doesn't distribute - 90 per cent of the electricity in this Province. Wouldn't that be a wonderful thing to be able to hold in your hand, regardless of what company wanted to come in, what business wanted to come into this Province today, to say that you own and can generate and guarantee people that you own it and not a private outfit?

Seventy-eight per cent of the shareholders of the new hydro company in Nova Scotia today are from outside the Province of Nova Scotia. If we haven't learned a lesson of mistakes in bygone years in this Province we should just look over our shoulders at our neighbouring province that did what we are doing now a just a few short months ago. Just look across there and see what is happening. They've got coal generation. Most of their fuel is coal generated in Nova Scotia. It has nothing to do with water that can run forever and a day like we have in this Province. We've got one of the cleanest, most environmentally sound generation of electricity in the world today.

We own it, regardless of what they say about the - the government is still going to guarantee the debt. If this passes on tomorrow government still guarantees the debt for this particular new Hydro. One of the biggest reasons for selling it is because it is a liability. How can one of the best assets you have be your biggest liability? If someone could explain that to me then I would probably go along with it.

I can just name five or six logical reasons why it should not be touched. We can charge Newfoundland Hydro more. This government can say tomorrow: Give me 2 per cent to float your bonds. They can charge 3 per cent to float their bonds, they can charge 4 per cent to float their binds. That is one instance alone. There is going to be a price increase anyway -

MR. SPEAKER: Order, please!

The hon. member's time is up.

MR. WOODFORD: Thank you, Mr. Speaker.

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

MR. ROBERTS: Mr. Speaker, we've had our two petitions, I gather, so with the acquiescence -

AN HON. MEMBER: Oh, oh!

MR. ROBERTS: I'm sorry?

AN HON. MEMBER: Is there a quota?

MR. ROBERTS: No, there is no quota, it is just we've had two. Accordingly I propose to move -

MR. SIMMS: Oh, oh!

MR. ROBERTS: Yes, that is fine. The Opposition Leader can schedule the petitions over there. We've had two on the electrical power. Members are obviously anxious to get on to it. I will move, pursuant to Standing Order 21, that the Orders of the Day now be read. No more than that.

SOME HON. MEMBERS: Oh, oh!

MR. SPEAKER: Order, please!

It is moved that the House now move to the Orders of the Day. All those in favour?

SOME HON. MEMBERS: Aye!

MR. SPEAKER: Against?

SOME HON. MEMBERS: Nay!

MR. SPEAKER: Carried.

Orders of the Day

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

MR. ROBERTS: Mr. Speaker, thank you. Would you be good enough to go to Order No. 4? Hon. members opposite can then make their speeches on the important issue of the Electrical Power Control Act.

MR. SPEAKER: Order No. 4.

The hon. the Member for Humber East.

MS. VERGE: Thank you, Mr. Speaker. I adjourned the debate on the principle of this bill on Friday after speaking for just two minutes.

The Electrical Power Control Act is intertwined with the Hydro privatization act. The two bills were introduced in this House of Assembly simultaneously by the government. The Premier in introducing each of them explained that the two are intertwined and that the Electrical Power Control Act contains many provisions which anticipate and facilitate the sale of Newfoundland and Labrador Hydro. After that, public opposition mounted and by the middle of March the Premier backed down to the point of going on Province-wide television and saying to the citizens of the Province that he would withdraw the Hydro privatization bill if a majority of citizens were opposed to it.

It is obvious that an overwhelming majority of the people of Newfoundland and Labrador are adamantly opposed to the government divesting itself of Hydro. That was measured by two independent, reputable polling firms within a week of the Premier's television address.

Mr. Speaker, if the Premier is going to keep the promise he made to the citizens of the Province, we shouldn't be proceeding with this second reading debate about Bill 2. The only acceptable course of action for the Premier and the government would be to withdraw both bills, and then, in the case of the Electrical Power Control Act, make appropriate amendments, modifications, changes, to the bill, and then come back with another piece of draft legislation, refer that revised bill to the appropriate Legislation Review Committee for public hearings.

Mr. Speaker, unfortunately, that is not happening and we are being forced to participate in a debate about the Electrical Power Control Act. We don't know what the Premier, in the end, is going to do with the companion legislation, the Hydro Privatization Bill. We don't know if the Premier is going to keep his promise.

Mr. Speaker, the Premier has held himself out to the public as a man of principle, as an honourable person, as somebody who keeps a promise when he makes one. That is how he presents himself to the population.

Mr. Speaker, having watched the Premier's performance over the last five years, many of us have observed a string of broken promises, but this was an exceptional promise. This was a commitment made on Province-wide live television, stated not once but three or four times, said clearly and unequivocally. The Premier of this Province said to all the citizens that if a majority of the population are opposed to the government's Hydro privatization proposal, he would withdraw the legislation. So it is quite wrong for the government to persist with this companion bill, the Electrical Power Control Act.

Mr. Speaker, there are several provisions of this bill which have to do with Hydro privatization, some of which are designed to ameliorate the sharp electricity rate increase that would surely result from the privatization of Hydro, yet this bill purports to set out as a major part of provincial policy for electricity, the provision of electricity at the lowest possible cost to consumers. So that part of the stated policy of this bill is completely at odds with Hydro privatization. Hydro privatization would add significantly to the cost of electricity. Inevitably, privatization would drive up electricity rates way beyond where they would be if the government retains Hydro as a Crown corporation.

Mr. Speaker, members opposite don't have to take my word for that, but I refer them to Memorial University Economics Professor, Wade Locke. Dr. Locke, a respected academic, has done a careful, detailed analysis of the likely cost and benefits resulting from Hydro privatization.

Now, Dr. Locke, the same as members on this side of the House, and private citizens of the Province, have not been privy to the government's assumptions and calculations about Hydro privatization, but Dr. Locke has studied many relevant documents, financial statements of Hydro and Newfoundland Light and Power, rulings and records of the Public Utilities Board, relevant information about utilities in other parts of Canada, the provincial Budget, the two bills before the House of Assembly. Dr. Locke has questioned government officials and the minister, the nominal minister responsible, the Minister of Mines and Energy, so Dr. Locke is able to make a very good, educated estimate of the costs and the benefits that would flow from Hydro privatization.

Dr. Locke acknowledges that there are several factors that would have a bearing and there may be a number of variables. Dr. Locke constructed an economic model and then plugged in several possibilities. Dr. Locke's conclusion is that the most likely variables indicate a whopping net cost to the Newfoundland and Labrador economy, a staggering increase in electricity rates for consumers; householders and small businesses.

Mr. Speaker, Dr. Locke has published his analysis. He conducted a public presentation of his analysis a couple of weeks ago which I was glad to attend. Over the course of an hour-and-a-half he outlined his approach, he showed his model and he answered questions. He subjected his analysis to scrutiny by his colleagues at the university, faculty and students, as well as people from outside the university community. The consensus at the presentation is that Dr. Locke had been extremely generous to the government in making his assumptions. Most of his assumptions favoured the government. Still, though, his conclusion is that Hydro privatization is likely to cost the economy of Newfoundland and Labrador a staggering amount each year, in excess of $50 million each year. Dr. Locke found that the benefits associated with Hydro privatization would be far, far outweighed by the costs - costs to consumers and costs to the economy of this Province.

Mr. Speaker, it doesn't take sophisticated analysis to see why there would have to be staggering costs associated with Hydro privatization. The current Crown-owned Hydro has a high debt equity ratio. A debt equity ratio of 82-18 - high debt, low equity, and that's quite sensible since debt is cheaper than equity. The current spread is over 3.5 percentage points. The average annual interest rate, paid by Hydro on its debt, is 10 per cent. The rate of return on equity ordered by the Public Utilities Board for the privately-owned electricity company in the Province, Newfoundland Light and Power, is over 13.5 per cent. Debt is always cheaper then equity. Debt involves less risk, less risk for investors, albeit more risk for the borrower but in the case of a utility producing and selling a necessary commodity, with the price publicly regulated, there's very little risk.

Now, Mr. Speaker, the plan, according to the minister and the Premier, is for a privatized Hydro to have a debt-equity ratio in line with the industry average, something approaching 50-50. I believe the Premier in his private locked door news conference indicated that the debt-equity ratio may end up being 58-42. So it will go from 82-18 to something approaching 50-50. Mr. Speaker, that will have to add close to $50 million a year to electricity rates. It will have to, because we'll have several hundreds of millions of dollars of 10 per cent a year interest bearing debt converted to 13.5 per cent a year interest bearing equity. And we'll have whatever the government chooses to settle for a price for its ownership equity, our equity, at $300 million on which it now gets an annual return of about 7 per cent. That will grow to 13.5 per cent or more. So by virtue of the change in the financial structure of a publicly-owned Hydro to a privately-owned Hydro, we are looking at close to $50 million a year extra cost for Newfoundland and Labrador consumers, and where will that additional $50 million or so a year, go? Most of it will go out of the Province to non-resident shareholders. Realistically, Mr. Speaker, the same as the shareholder profile of Newfoundland Light and Power and Nova Scotia Power, most of the investors will reside out of the Province.

We have a small provincial population, we don't have a lot of wealth in our Province, so when Nova Scotia Power privatized and 80 per cent of the shareholders ended up living outside the province, is it realistic to think that a higher percentage of a private Hydro's share purchasers would reside within our own Province? So the approximately $50 million a year additional cost that Newfoundland and Labrador consumers will be saddled with, will, for the most part, be paid outside of the Province to the non-resident shareholders.

Mr. Speaker, there are other reasons why the cost of electricity will go up, but the change in the financial structure of the corporation will be the largest single contributor to the staggering cost increase. Now, Bill 2 contains measures to try to moderate the whopping price increase that will result; there will still be a staggeringly high price increase associated with the government divesting itself of Hydro, not quite as high as there would be otherwise.

Mr. Speaker, one of the provisions of this bill, calculated to keep down the extent of the electricity price increase is found in, I think it is clause 3 of the bill, and that's the provision dealing with federal legislation called the Public Utilities Income Tax Transfer Act. It is in clause 3 (e). That clause provides that the revenue which under the federal legislation, the Federal Government now shares with the Provincial Government, which is derived from private utilities, will in future, be refunded to the private utility.

Now, private utilities have to pay federal corporate income tax. We have now one private electrical utility in the Province, Newfoundland Light and Power, and that corporation pays to the Federal Government, federal corporate income tax. Under the federal act now, 85 per cent of that is shared with the Provincial Government and that contributes close to $10 million a year to the provincial coffers, revenue which the Province uses for education, health, social services and all the other provincial responsibilities.

Under this provision of Bill 2, the Province would forfeit that revenue by refunding it to Newfoundland Light and Power, and from what the Premier and the minister have said, the purpose is to have the extent of the electricity rate increase ameliorated because it's assumed that Light and Power would factor that rebate into its rates, or that the Public Utilities Board would ensure that the rebate is factored into rates, and rates would thereby be lowered.

Now, Mr. Speaker, a privatized Hydro, the same as Light and Power, would be subject to the requirement of paying federal corporate income tax. Now, because Hydro is a significantly larger corporation than Light and Power, the amount of money at stake is much greater, and if the Federal Government were to keep the federal corporate income tax that would be levied on a private Hydro, then that amount, an estimated $30 million or $40 million a year would have to be factored into rates charged customers.

Under the current federal legislation, the same as the share for Newfoundland Light and Power tax, 85 per cent of a private Hydro's federal corporate income tax would be shared with the Province. Under the provision in Bill No. 2 that share would be passed back to Hydro, thereby keeping down the electricity rate increase - keeping it down to a mere $50 million a year.

Dr. Locke at the University pointed out that the federal legislation is exclusively within the legislative competence of the Federal Parliament. In other words, there is nothing that this Provincial Government or any other provincial government can do to ensure that that legislation continues. Mr. Speaker, that legislation, involving the sharing of private utilities' federal income tax with provinces has been under attack. A couple of years ago PUITTA provided for a 95 per cent share of private utilities' corporate income tax with the provinces. Two years ago the Federal Government decreased the share from 95 per cent down to 85.5 per cent.

Professor Locke pointed out that electrical competitors, such as the oil industry, might likely lobby to have the PUITTA sharing arrangement decreased or eliminated altogether. If the federal legislation is repealed and Ottawa keeps all the federal corporate income tax paid by private utilities to the Federal Government, then there is nothing a Provincial Government or a House of Assembly in St. John's would be able to do to prevent a further electricity rate increase of the magnitude of $50 million a year.

So, Mr. Speaker, because of the intended change in the financing structure of Hydro from going public to private there would be approximately $50 million a year loaded onto consumers, most of which would end up being paid outside the Province to non-resident shareholders. If the federal legislation dealing with a sharing of private utilities' federal corporate income tax with provinces is repealed there would be another $50 million a year loaded onto Newfoundland and Labrador electrical consumers, making a whopping total increase of $100 million a year.

Mr. Speaker, as I said at the beginning, it is quite improper for the government to be requiring, forcing, coercing the House of Assembly to proceed with a debate of the Electrical Power Control Act when the Premier has promised to withdraw the Hydro privatization bill, and yet this bill contains many provisions, including the ones that I've mentioned, that have to do with Hydro privatization and facilitate it. If the government were not contemplating privatizing Hydro, surely, the government wouldn't be contemplating giving up close to $10 million in revenue which it now gets under PUITTA from the Federal Government, which originates with Newfoundland Light and Power. That wouldn't make any sense for a cash-starved Provincial Government, for a Provincial Government that is projecting a big current account deficit again this year.

Mr. Speaker, it is not right for us to be proceeding to pass legislation that would proclaim as Provincial Government policy providing electricity to consumers at the lowest possible cost when the same piece of legislation contains measures that would have to do with privatizing Hydro and obviously drive up the cost of electricity way beyond the level we could have if the government simply continues to own Hydro.

There are other provisions of this bill intertwined with the evil proposal to sell Hydro - evil, I say to the Member for Fogo. Those provisions, for the most part, are found in clause 3. Then, in clause 23 we see a provision which purports to limit share ownership in an electrical utility to 20 per cent of the voting shares, but allows the Public Utilities Board to approve ownership of more than 20 per cent of the shares if it is in the public interest.

Mr. Speaker, why conceivably would that be there? Is it because the Premier still has, in the back of the mind, the possibility of a merger between the company of which he was board chair immediately before re-entering provincial politics, and Hydro? Is it because the Premier has a grand design to have Newfoundland Light and Power merge with Hydro? How would that be in the best interest of the people of the Province? But why else would this provision be in the bill? How would that 20 per cent ownership limitation affect the paper companies' electrical generating facilities?

Corner Brook Pulp and Paper, owned by Kruger, and Abitibi-Price each have power-generating capabilities. Corner Brook Pulp and Paper, through its Deer Lake power plant, generates most of the power, something like 80 per cent or more, of the electricity it needs for the operation of a newsprint mill in Corner Brook. How would that affect the paper companies?

Mr. Speaker, the Premier confessed in his first Province-wide television address, the one on NTV, that his real reason for proceeding with this legislation, and with divestiture of Hydro, is to try to recapture power from the Upper Churchill which now flows to Quebec under the contract between CF(L)Co and Hydro Quebec.

The Premier provided a legal opinion about such a strategy back in 1986 when he was in private law practice, and when he was serving as a director of Newfoundland Light and Power. The theory involves having provincial legislation empowering the Public Utilities Board to reallocate any power produced in the Province - in other words, setting up the PUB to expropriate power.

Mr. Speaker, the Premier's theory hinges, in part, on this Public Utilities Board power being of general application and not being targeted at the Upper Churchill, because the Supreme Court of Canada, in striking down the Water Rights Reversion Act as being unconstitutional, issued a warning, and I quote: `The Supreme Court of Canada, in a unanimous decision, said - I am just trying to find the quote, Mr. Speaker. The Supreme Court of Canada issued a warning about provincial legislation violating the division of powers in the constitution by masquerading as a provision regulating affairs within a province when, in reality, the impact is to infringe on arrangements between provinces which are within the exclusive jurisdiction of the Federal Parliament.

I have found the applicable statement, and I quote: `Where, however, the pith and substance of the provincial legislation is the derogation from or elimination of extra provincial rights, then even if it is close in the proper constitutional form it will be ultra vires.

Mr. Speaker, the Premier is suggesting that part 2 of this bill is convincingly cloaked - I see the Minister of Social Services is fascinated by my speech. I'm glad to have his rapt concentration.

MR. SPEAKER: Order, please!

The hon. member's time is up.

AN HON. MEMBER: By leave.

MS. VERGE: Oh, thank you.

MR. SPEAKER: Order, please!

Does the hon. member have leave?

SOME HON. MEMBERS: By leave.

MR. SPEAKER: By leave.

MS. VERGE: The Premier is on the one-hand, out of one side of his mouth, trying to say that part 2 of this bill is of general application but then when the Leader of the Opposition asked him specifically if it would apply to the paper companies - to Corner Brook Pulp and Paper and Abitibi Price - he said, no. Now, Mr. Speaker, if part 2 does not apply to the paper companies who's left? Who else is there in the Province producing power?

At any rate, Mr. Speaker, this approach, if continued with by the government and if there was a realistic chance of success, I would wholeheartedly support it, this approach is guaranteed to land us back before the Supreme Court of Canada. Surely Quebec will challenge any move by the Newfoundland and Labrador Public Utilities Board under this or similar legislation as exceeding the constitutional power of the provincial legislature. So we would be in for a long drawn-out expensive third case before the Supreme Court of Canada. Mr. Speaker, we wouldn't be able to get all the way to the Supreme Court of Canada instantly. This is a matter that would drag through the lower courts, through the Newfoundland Supreme Court trial division and then the Court of Appeal. So it's similar to the 800 megawatts recall case which dragged through the courts for eight or ten years. We would be in for a long drawn-out expensive court battle.

In the meantime, Mr. Speaker, what about our chance to negotiate a good deal with Hydro Quebec for both the Upper Churchill and the Lower Churchill? Our interest in the Upper Churchill is in jeopardy, Mr. Speaker, since by 1998, four short years from now, CF(L) Co will go into a deficit position and the annual shortfall will become worse as the years go by. We now own two-thirds of the shares in CF(L) Co., Hydro Quebec owns the other one-third. If Hydro Quebec puts money into the company to keep it solvent, Hydro Quebec would be entitled, under existing contractual arrangements, to gain more shares and more control of the corporation.

Mr. Speaker, as I revealed last month, two short years ago this government had a golden opportunity to get redress on the Upper Churchill and to develop the Lower Churchill but it was an opportunity squandered and hidden from the people of the Province. Now, Mr. Speaker, as I exposed, by making public a Cabinet briefing document, what the Premier walked away from two years ago involved a Hydro Quebec offer to have side agreements on the Upper Churchill involving Hydro Quebec injecting billions of dollars additional into the Upper Churchill to keep the company solvent, to replace worn infrastructure and in addition to net the Newfoundland and Labrador Government over $4 billion in additional royalties and revenues over the remaining life of the Upper Churchill contract which stretches to 2041, that was number one. Number two, Hydro Quebec offered a cooperative approach to developing the Lower Churchill, both Gull Island and Muskrat Falls, by purchasing power surplus to the requirements of Newfoundland and Labrador over 2000 megawatts initially - about 2500 megawatts initially, over a thirty year term at an escalating price.

MR. SPEAKER: Order, please!

On a point of order, the hon. the Member for St. John's South.

MR. MURPHY: Leave withdrawn, Mr. Speaker.

MR. SPEAKER: Leave withdrawn.

MS. VERGE: I guess the truth hurts.

The hon. the Member for Menihek.

MR. A. SNOW: Thank you very much, Mr. Speaker. I'm pleased to have the opportunity to speak on this bill.

Bill No. 2 is inextricably tied to Bill No. 1 and thus I have quite a bit of difficulty with portions of Bill No. 2, because of my opposition to Bill No. 1 and how they are both tied together. Because we know that the bill is broken down into basically three parts. Part I deals mainly with the privatization issue and how Bill No. 2 will have an effect on Bill No. 1, and conversely Bill No. 1 on Bill No. 2. I have quite a bit of difficulty with Part I of Bill No. 2 because of, as I said, my opposition to the privatization of Newfoundland and Labrador Hydro and the effects the privatization of Newfoundland and Labrador Hydro will have on the people of this Province.

We heard the Premier when he addressed the Province on March 22 speak of why the people of the Province should support Bills Nos. 1 and 2. If I may first of all just have a few very brief comments concerning that presentation the Premier made to the people of this Province when he suggested to them that he had this super scheme to right the wrongs of the Upper Churchill deal and that this is one of the reasons why he asked the Cabinet and his caucus to be quiet and not to mention, not to discuss, not to - I forget the exact words that he chose, but it was that we wouldn't cause this to be struck down by the Supreme Court of Canada because of some inflammatory remarks by members of the provincial Legislature.

That in itself is a misstatement because he suggested that the water rights reversion act had been struck down by the Supreme Court of Canada on the fact that a member of the House of Assembly, a member of the provincial Legislature at the time, had made some inflammatory remarks and were attempting - this was going to cure all. Where in point of fact, the statements by members of the Legislature weren't admitted as evidence, is my understanding. What exactly did happen was that it was statements in a written brochure that had been published by the government had been admitted as evidence and that is what was ruled upon. The government couldn't propose to do through the back door what they can't do through the front door. That is why the Supreme Court ruled against the provincial Government of Newfoundland and Labrador with regard to the water rights reversion act.

Of course, by the very fact that when the Premier mentioned that, by the very fact that he went on t.v. and referred to the fact that this was his super scheme, he was going to right these wrongs, he fell into the same boat that the previous administration did when they attempted to do this, to right this wrong on the Upper Churchill deal.

I am digressing a little. I just want to get back to my statement that these two bills are inextricably entwined together and that is one of the reasons why I have a problem with it. Because Part I of Bill No. 2 is tied to the privatization of Newfoundland and Labrador Hydro. In his infamous television appearance the Premier suggested that one of the first reasons that he apologized to the people of the Province and his colleagues in government that by asking them to keep quiet he undoubtedly did some damage to the public of this Province in the fact that they weren't willing to accept the sale or the privatization of Hydro because of misstatements made by people who have a contrary opinion to his.

One of the first things he suggested is that what this government will get from the privatization of Hydro is that it is going to have some money coming to it because of the sale. We are going to be selling this tremendous asset and some people have suggested we may get $500 million, $600 million or $700 million for it. Any way, we are producing an asset of this Province I believe that is going to be very undervalued in a sale. Thus we are not doing the Province any favour by selling this.

Yes, we will get a quick fix of dollars but that doesn't solve your problem, Mr. Speaker. We have to have other things done in this Province other than just selling off assets and attempting to correct the economic situation that we are in by selling off assets. You will not cure the problem with a quick fix and that is what this government is attempting to do. When he accuses the Opposition, or the naysayers, the people who are opposed to the sale of Newfoundland and Labrador Hydro of misstatements he should first of all look at himself because what he is suggesting is that this sale is going to solve the economic problems to a large degree. It will not, Mr. Speaker. It will only be a quick fix for a very short period of time and we will not have to borrow for the next one or two years. Then we will have this asset that is forever and forever gone. Not only will we have to worry about this asset being gone but so will our children and their children. They, too, will have to worry about higher costs of electricity because the Premier by his own admission has stated that we will all have to pay more for electricity as ordinary consumers due to privatization.

The quick fix is not going to work, and the Premier is misleading the people of this Province when he suggests that just because we do not borrow for two or three years we solve the economic problems. Far from it, we create larger problems because we have larger financial problems for everybody to bear down the road because we are going to pay more for electricity as consumers.

Number two, the Premier suggests that he will improve the credit rating of this Province by the fact of lowering the debt because we will remove the debt of Newfoundland Hydro. Experts in the field, Mr. Speaker, have suggested this is not true and will not occur because in point of fact we have Crown corporations in this country such as Hydro Quebec which is a similar Crown corporation and they actually lead the Province of Quebec in their credit rating. They drive the provincial economy of Quebec. I feel there is no reason that we could not have a similar type of approach in this Province in the fact that we should be able to drive our provincial economy with a Crown corporation. They do it in Quebec and if it works there it can work here.

The Crown corporation debt removal, Mr. Speaker, yes, we are going to take $1 billion off but we are going to be giving away, selling, or privatizing an asset that is worth a lot more than the $1 billion that we are going to be removing from the debt. In point of fact we are not going to be making the Province more credit worthy, we are going to be putting it in a more liable position because our assets have been tremendously reduced. That is what is going to happen, Mr. Speaker. That is exactly what is going to happen, our assets are worth more than what they are going to be sold for so we are putting ourselves in a greater liability position. That is the second misstatement, if you will, that the Premier has made.

Third, the talks about the privatization of Newfoundland and Labrador Hydro is going to solve the economic woes because he links it with the private sector being the engine of economic recovery of this Province. I believe in the private sector. I come from the private sector. I worked in the private sector and I have earned a living for the last twenty years in a small family operated business. I have earned a good living from it.

MR. TOBIN: What kind of business?

MR. A. SNOW: I have worked in it, Mr. Speaker. I have earned a good living and so has my family. Prior to that I also worked for a large private sector company, one of the largest mining companies operating in the world today, the Iron Ore Company of Canada, and they today are probably the best mining company in the world. I believe in the private sector but I do not necessarily believe what the Premier suggests, that just because we sell off a Crown corporation, the Hydro corporation, that it is good for the economy. Let us take a look at it for a second. Will a small business operator have to pay less for electricity after Newfoundland Hydro is privatized? Will they have to pay less or will they have to pay more?

Mr. Speaker, the Premier himself has admitted, and even the unknowing Minister of Energy says that consumers will have to pay more for electricity after privatization, because we have to give a return to the investors. Apart from paying the debt we also have to give a return to the investors, so will that help small business? No, you will drive up the operating cost of small business.

Will people invest in this Province? Sure they will invest. They will invest in the new Hydro. They will buy shares, but what will that do to this Province? I will tell you what it will do. It will remove capital from being invested in other sectors, other parts of industry, whether that's tourism, mining exploration, or the fishing industry, or whatever it is, that capital is now going to be invested in new Hydro, and they are going to expect a return, and they will get a return, so the capital is going to be removed, and capital is very, very scarce in this Province, so we are going to be removing capital out of the marketplace, because we are going to sell this Crown corporation to the private sector. So that's a misstatement.

He attempts to suggest, just because the private sector is going to be the engine of recovery, basically, in our economy, that by privatizing Newfoundland and Labrador Hydro it will accelerate the economy. That's not true. It's a misstatement. It won't work. It will shrink the private sector. It will increase their costs, it will remove capital, and that will hurt the private sector.

Fourth, he is saying that this is going to increase the viability of certain industries in this Province, mainly the paper companies. The Premier suggested, in his address, that that was the fourth reason, that the paper companies would be more competitive. So they may, but who is going to pay the extra burden? In the initial three or four years, until 1999, you know who is going to pay it? The taxpayers are going to pay it, because they are going to give a one-time grant of, I think it is $15 million, to new Hydro to help defray the cost that now is borne by the industry, because the two paper mills produce their own power, and they subsidize the rural distribution of electricity. There is going to be a one-time subsidy of $15 million. What happens in 1999? You know what is going to happen. The subsidy is a one-time subsidy. It will be removed and then the rural subsidy will be gone. The rural subsidy will be removed, and people will have to pay more for electricity.

So again the suggestion that this will help the industry - yes, it will help the industry, but who is going to pay? The consumers, the ordinary consumers of this Province will pay after 1999, and they are paying in the initial stages anyway, because they pay it through their tax dollars, because a taxpayer and a rate payer are one and the same person, and they are going to have to pay it up front, in taxes, because the government is going to give a subsidy, and then what is going to happen is that new Hydro will be allowed to charge whatever rates they wish as part of the investment, and this will be part of their investment, so they will have to bear that cost.

The Premier suggested that one of the things that will occur is that the municipalities will receive an extra million dollars in 1998. Now again we are talking about getting an extra few dollars - $1 million to municipalities. Now this is not a lot of money, split up amongst all the municipalities of this Province, but again we tout that as being an advantage.

If you want a Crown corporation to pay municipal taxes, and I actually believe, being a former member of municipal government, that Crown corporations should pay municipal taxes anyway, and so should provincial governments, or grants in lieu, and so should government buildings. They should also pay, similar to how the federal government pays their grants in lieu to municipalities, but we must remember that the taxpayer and the rate payer again are one and the same person, so to think that municipalities are going to be swayed by this, I think, is infantile for the Premier to suggest this as an advantage of the sale and why it should be privatized.

Those are just a few of the reasons, if you will, why I can't support Part I of this particular bill in Bill 2, because it is inextricably tied to Bill 1, and because of my opposition to Bill 1, I cannot support Part I of Bill 2.

Mr. Speaker, in Bill 2, Part II is the Planning, Allocation and Reallocation of Power and Facilities.

Generally speaking, the Premier talked about one of the things that could occur was part of his secret scheme that he had that could right the wrong of Upper Churchill, how he suggested that if this were to occur, if Bill 2 could be passed then we may be able to right that wrong that had been done years ago by a Liberal government -

AN HON. MEMBER: (Inaudible).

MR. A. SNOW: Well, the Premier has also suggested that it was a wrong.

AN HON. MEMBER: No, that's in your judgement.

MR. A. SNOW: No. The Premier suggested that it was wrong. The Premier himself has suggested, in his television address, that there were two reasons. One was redressing the grossly unfair situation of the Upper Churchill contract with Hydro Quebec, which sees Hydro Quebec get a greater benefit from the generation of 5,250 megawatts of power from Upper Churchill and they get it for basically about 3 mils and sell it at a tremendous profit, somewhere around the vicinity of $700 million economic grant accrues to the Province of Quebec, and he says that what they may be able to do, and he has in his limited experience he suggested, that they would be able to, because of Section (inaudible) they would be able to use that section in the Constitution and if we pass this part of the bill, Part 2, that we would be able to right this wrong that had been done back in the 60s by a previous Liberal Administration, and the Premier himself was in the Cabinet at that particular time.

But I am not so sure that this can be done. I would like to be able to see the analysis that had been done, and I would suggest that what the Premier should do, what the government should do is, strike a panel of well-learned lawyers and to research this thoroughly because I don't know what advice he sought, he hasn't told us, he hasn't told the people of this Province whom he sought advice from; most lawyers with whom I have spoken and whom we have had briefing us, have suggested that there won't be any more grounds for this such as what Patrick O'Flaherty has suggested in his article in an editorial written, that there is no difference in doing this way than what a previous administration had attempted to do with the Water Rights Reversion Act.

So I would suggest that what they do would be to strike a committee of well-educated and experienced lawyers and have them give a public - make some public discussion, create some public discussion and more awareness about whether or not we would be able to correct the infamous Upper Churchill deal because if indeed we could, I would readily support this part of the bill, but, I still don't see why we would have to privatize Hydro; I don't think you have to necessarily link the two.

The Premier himself suggested in 1986 that it didn't have to be linked in a subsequent debate to the infamous NTV appearance, the Premier admitted that it wasn't necessary to privatize Newfoundland and Labrador Hydro, and when he was confronted by the Leader of the Opposition, he admitted that it wasn't necessary to do it so what we should do as the Leader of the NDP Party suggested, we should tear up Bill 1 and proceed in a timely fashion if you will, with a discussion and more research on -

AN HON. MEMBER: (Inaudible).

MR. TOBIN: What? He spoke twice?

MR. A. SNOW: No, he didn't.

MR. SULLIVAN: No, he was an honourable person, he didn't speak twice.

MR. A. SNOW: Mr. Speaker, the Premier should in my opinion strike a special committee and have that committee research all the implications of what would occur if we were to pass - because I would readily support Part II of this bill. I think that most people in this House would readily support it if they thought that we could by doing this accrue a tremendous benefit to the people of this Province. A wrong that was done to us back in the 1960s.

I don't know of any studies that have been done. I don't know what has been done. The only one that I know of is the Premier says that he feels - he is the only one who has touted it. There is an expression that goes about that a lawyer who acts on his own behalf has a fool for a client. Maybe the Premier should take heed to that statement.

MR. TOBIN: What is that? Say that again. A lawyer who acts on his own behalf....

MR. A. SNOW: His own behalf has a fool for a client. Mr. Speaker, the Premier should take that advice and seek more legal advice as to what exactly the implications are, and not attempt, like a lot of people are suggesting, to hoodwink the people in this Province by tying this particular part of the bill to the privatization. Because that is fundamentally wrong. You are falsely raising the hopes and aspirations of the people of this Province because they've felt a tremendous burden and shame over the last numbers of years because of this tremendous wrong that was done to us as a province and as a people back in the 1960s with regard to the development of the Upper Churchill.

The other thing, one of the problems I have with it - and again this is from legal advice. I am not a lawyer. In some briefing notes that we've had presented to us, people suggest that in Part II the paper companies themselves could be put in some jeopardy because of this particular part of the bill. That because of their lack of secure energy this could place their assets in a certain liability. Of course, because their assets are restricted - their assets being electrical energy producing plants - and they would then have a very fixed cost, so their assets are going to be restricted, so that would limit their asset and thus it could possibly restrict the amount of borrowing that may be necessary for them to operate in a prudent and competitive fashion.

Because we all know that in today's market the pulp and paper industry is very competitive. If indeed that is one of the reasons why we had to pay an extra $15 million to one of the paper companies recently - because some people have suggested this is what exactly occurred. That we gave them this subsidy on the short-term and maybe we can let this go for another while. If it affects all producers - it will affect all producers. You can't have it both ways. You can't say it won't affect Kruger but it will affect CF(L)Co., in my opinion. I believe that it will affect both.

With those few restrictions I don't see where I could not support Part II of Bill No. 2, albeit I'm still adamantly opposed, because I see no benefit whatsoever, no permanent, long-term benefit for the privatization of Newfoundland and Labrador Hydro. Thus I cannot support Part I of Bill No. 2.

Also, because I believe that if this were to work - let's assume that it could work. What would happen to any further hydro development? Hydro development as we all know has just about totally developed now on the Island portion of the Province. The only area of the Province where we have any sense of large projects in hydro development able to proceed, or potential for development if you will, is in Labrador.

If this could work, Mr. Speaker, how would we then proceed with any development? How could it work on the Lower Churchill? I don't see how it could. Would Hydro Quebec enter into a contract that cannot absolutely guarantee the supply of power? I don't think they could. I don't know of anybody who would finance it.

Mr. Speaker, can Hydro Quebec resell power to the United States if it cannot absolutely guarantee that power? It couldn't.

AN HON. MEMBER: (Inaudible).

MR. A. SNOW: Gorbachev is over there somewhere. That is Breshnev, isn't it?

Mr. Speaker, I can see where this could have a negative impact upon further development of hydro in Labrador, and thus, that is another reason why I would have to have second thoughts about any support I could give for Bill 2.

Now, Mr. Speaker, Bill 2, Part III, with regard to emergency power - while I believe that no province in this country has any similar type of legislation which provides for the permanent expropriation of power and facilities, most provinces do have legislation to provide for emergency recall of power, and we do not. It is long overdue and I can support that thrust in the legislation.

With those few remarks, I just want to conclude, if I may.

MR. TOBIN: You still have three minutes.

MR. A. SNOW: One of the things that does bother me to no end, is the unwillingness of this government to listen to people. I reiterate and repeat that I am dismayed at the unwillingness of this government to listen to people, to allow people to express their concerns about the effects of dramatic moves this government is going to make with the privatization, and I believe, in a wrongful fashion, with regard to rushing this bill through the House without proper consultation with the people it is going to affect, mainly the paper companies and ordinary individuals.

I think this government, while on one hand espousing one theory about consultation and the willingness to listen to people, they don't do it, Mr. Speaker. They are long on style and short on substance. There is absolutely no reason, that I can see, where I can support this particular bill because of how it is being tied to privatization and is not necessary. If this bill were only attempting to address the problem and create another method or a better method of giving us as Newfoundlanders and Labradorians the opportunity to further develop hydro in this Province, I could support it. If this bill could and would give us a greater access, in the case of an emergency, to hydro facilities, distribution, and production, I could support it, but the fact that this bill is totally tied to the privatization of Newfoundland and Labrador Hydro - and I believe that is all it is about. It is only about the privatization of Newfoundland and Labrador Hydro.

MR. SPEAKER: The hon. member's time has elapsed.

MR. TOBIN: By leave, Mr. Speaker.

MR. A. SNOW: Now, Mr. Speaker, I will not support this particular bill because the bill is only being tied as a smoke screen for the sale of Newfoundland and Labrador Hydro and that's fundamentally wrong. This government is attempting to deceive the people by falsely raising their hopes, by going after the Upper Churchill.

MR. SPEAKER: Order, please!

On a point of order, the hon. the Member for St. John's South.

MR. A. SNOW: It didn't work the last time and the Supreme Court won't allow it to work this time.

SOME HON. MEMBERS: Hear, hear!

MR. MURPHY: The member can't be getting on with that stuff. No leave, Mr. Speaker, no leave.

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

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

I'm pleased, Mr. Speaker, to rise today and speak on Bill No. 2, an Act to Regulate the Electrical Power Resources of Newfoundland and Labrador. As I stated before, Mr. Speaker, I believe that this act was fraudulently introduced into the House of Assembly when the Premier first introduced it. We found out the reasons why it was introduced in an address on province-wide TV, long after the bill was introduced into the House. The real reason was given, at that point in time, as being to try to access the Upper Churchill power. Again, in the leader's debate a few nights afterwards, the Premier agreed that there was no need to privatize Hydro to access the Upper Churchill power.

AN HON. MEMBER: (Inaudible).

MR. J. BYRNE: Another twenty-nine minutes and thirty seconds.

I realize that Bill No. 2 and Bill No. 1 are closely associated, one with the other and it's hard to speak on one and not the other, as many members in this House have done, Mr. Speaker. I believe that this bill is a very important bill and it could be supported by all members of the House if certain sections of the bill were taken out which refers to, of course, the privatization of Newfoundland and Labrador Hydro. Subsection 3(a), paragraphs 1-3 and subsection 3(a) paragraph 4, which deals with the rural subsidy ending in 1999 is a very important issue and will have drastic effects on the rural areas of Newfoundland and Labrador in the future.

The power emergency section, Mr. Speaker, which is part 3 of this act - I'm going to certainly agree with the intent of that section and it's probably long overdue. I realize or understand that there are other provinces which have similar legislation.

With respect to the privatization of Hydro, Mr. Speaker, I don't believe that there will be any benefits accrue to the people of Newfoundland and Labrador, although the Premier says, over the next ten years we will save approximately $250 million, which actually works out to be approximately $25 million a year. Figures have shown that it will actually cost the Province over $1 billion in the same period because of increased rates, subsidies, and tax concessions to certain companies - Newfoundland Power and New Hydro, of course. The Premier has also stated in the past that the selling of Newfoundland Hydro will boost our credit rating in the Province but the rating companies, themselves, disagree with that statement and have said so. They have said that Newfoundland Hydro is self-sustaining and it is excluded from the public debt when they are doing their calculations.

I believe now that the government is grasping at straws and trying to get people to support the bill - such people as RBC Dominion Securities who are about to make $20-$30 million on this deal, people like Merrill Lynch and Mr. Kellogg who was here speaking to, I believe it was the Board of Trade.

I noticed, Mr. Speaker, that there were very few members opposite who spoke in the debate over the past months on this issue, either on the privatization of Hydro or actually the six-month hoist. There were a couple of members opposite who spoke on the six-month hoist but very few spoke in favour of the privatization of Hydro. I realize that it's probably because the Premier has those hon. members muzzled and he basically told us that on province-wide TV a month or so ago.

Mr. Speaker, I would like to look at the number of people who are opposed to the privatization of Hydro. We have had a number of polls now done by different groups who say that possibly 70 per cent or 80 per cent of the decided vote is against the privatization of Hydro.

AN HON. MEMBER: Carried.

MR. J. BYRNE: In due course, I imagine it will be, because of the weakness of members opposite.

Mr. Speaker, we have hundreds of thousands of Newfoundlanders opposed to the privatization of Newfoundland Hydro, and the Premier has basically stated that he would resign if it can be proven that the majority of people in this Province are against the privatization of Hydro. Again, as I said before, it is hard to speak on Bill 2 without speaking on Bill 1, because they are so closely related.

Who will benefit from the privatization of Newfoundland and Labrador Hydro? Well, we have already seen who will benefit. It is not going to be the ordinary Newfoundlanders, the ordinary citizens of Newfoundland and Labrador. The Rothschilds of the world, as we now know, have already received approximately half a millions dollars - $450,000. The legal firms, such as Curtis, Dawe, have received $145,700 so far; Blake, Cassels, over $600,000 - can you imagine? - $600,000 - for opinion on what may or may not happen after Newfoundland and Labrador Hydro is privatized - and others besides.

Again, who will lose with the privatization of Newfoundland and Labrador Hydro? The consumers of electricity in this Province are the people who will lose, the ratepayers. Rural rates will increase as subsidies disappear. The people of Labrador will pay as much as 30 per cent more for their hydro, and there will be $100 million per year in subsidies and tax concessions given out by this Province after Newfoundland and Labrador Hydro is privatized or if it is privatized, I should say.

The Premier has stated in the past that the municipalities will benefit. How many municipalities will benefit, and by how much? And if the municipalities, themselves, will benefit, then, of course, the extra rates will be passed on to the taxpayer within that community.

We have had a lot of discussion on the loss of jobs. The Premier, himself, has agreed that there would be a loss of jobs, and he has, in the past, compared this to the privatization of Nova Scotia Hydro, where it was guaranteed there would be no loss of jobs, and in actual fact they lost 400 jobs soon after the privatization of Nova Scotia Hydro. In Nova Scotia also, of course, the electricity rates increased, there was a lowering of their credit rating, and a very important point that we should all remember, I believe, is the fact that 75 per cent of Nova Scotia Hydro now is owned by people outside the Province of Nova Scotia, which certainly would be the situation that would happen here, I would imagine.

Another very important issue, of course, is that the government had no mandate to privatize Hydro. During the election last year - it will be a year ago tomorrow, May 3 - it was brought up during the election as an issue, and it was basically tossed aside, that there was no truth to that issue, the privatization of Hydro. Again, shortly afterwards, when we brought it up in the House of Assembly last spring it was denied that there were any dealings going on with respect to the privatization of Hydro, and we now know different, of course.

Mr. Speaker, there have been a good many dollars spent this past month or two months on the ads, etc. in the papers to convince people that their views are wrong. The majority of people, by far, are against the privatization of Hydro, and now we have spent tens of thousands of dollars to convince people that their views are wrong. We have radio clips and newspaper ads telling people the reason why the government believes that their views are correct.

I brought this up once before, and when the Premier was opposing Meech Lake and the Charlottetown Accord, of course, the Federal Government of the day provided money for the opposing view, so it wouldn't be one-sided, where the Federal Government, at that time, had the bucks to put into the promotion of that idea or thought with respect to Meech Lake or the Charlottetown Accord. They also provided the opposing view, with the funds to get their ideas and reasons why they opposed, out. I don't see that happening in this situation.

They had misleading information in those ads, as far as I am concerned. They talked about government involvement in commercial enterprises, and how the government should not be involved in commercial enterprises. They are saying there is nothing going to change with the sale of Newfoundland and Labrador Hydro. The only thing that would change would be the government involvement, and the financing and operation of Hydro. Well, Mr. Speaker, I really don't believe that point of view of course, and we know that Hydro really can't be compared to an ordinary, regular, commercial enterprise for the very reason that it's an utility and a monopoly within the Province, and most provinces try to maintain their utilities especially when it comes to hydro as far as I know, Mr. Speaker.

It cannot even be compared to the privatization of NLCS, Newfoundland and Labrador Computer Services or of course, Newfoundland Farm Products and although I agree in principle with the privatization of those types of businesses, if you would like to call them that, I still have to wait and see the facts and figures and see if you could support it as the government is promoting it from their point of view, but we don't have those facts and figures yet and I would imagine in due course we would receive that information.

Now, Mr. Speaker, subsection 23 (1) and 23 (4) give certain powers to the Public Utilities Board, and that section basically, Mr. Speaker, would approve or give the Public Utilities Board the power to approve ownership of over 20 per cent shares in an electric utility. Now, Mr. Speaker, I remember when this was first debated and the Premier stood up and said that the only number of shares that a person or company could own would be 20 per cent, and of course that was said to try and promote the idea of the privatization of Hydro, and to alleviate fears that major portion of shares in the Province would leave the Province, and of course now, we have that section which would allow companies and/or individuals from outside of the Province to maintain or obtain over 20 per cent of the shares and I believe this is directly related to the Premier's first objective and that was to merge Hydro with Fortis and this would certainly allow that to happen.

Mr. Speaker, there are other sections in this bill that would allow that to happen and of course, the first one would be to instruct Public Utilities Board to base rates on three criteria. One is the cost of course to the new company, and secondly the maintenance of credit worthiness and third, the profit for shareholders. Another section that would direct the Public Utilities Board to phase out rural subsidies to the industrial customers by 1999 and a third would be the transfer of responsibility for essential employees to the Public Utilities Board.

Now, Mr. Speaker, I find that one very peculiar in that, I understand that the Labour Relations Board of course has the experience and the knowledge to deal with the essential employees and have done so over a number of years that they have been in existence, whereas, the Public Utilities Board I don't believe has the experience, and basically the equipment to deal with that type of a situation, Mr. Speaker, and I believe the only true facts and figures that have been forward over the past while with respect to Newfoundland and Labrador Hydro privatization, are those put forth by those opposed.

Government has put forward very few figures of course, and basically the only one that they put forward so far is what they are going to save $25 million a year. The Premier has publicly stated that the opposition to the privatization of Newfoundland and Labrador Hydro is based on hysteria, emotion and misinformation, but it is hard to -

MR. EFFORD: (Inaudible).

MR. J. BYRNE: Mr. Speaker, as long as I have the Minister of Works, Services and Transportation's listening to me, I am happy.

Mr. Speaker, the Premier says that those opposed to the privatization of Hydro are based on the hysteria, emotion and misinformation but it is hard for those people to base it on anything else when the government refuses to give them their information that has been asked for so often, and basically the government is insulting the public by saying they are not intelligent enough to understand the situation, that's why they have refused to give them the information. The public, I believe, know what they want, and they do not want privatization.

Again, Mr. Speaker, if you could take out the sections in Bill 2 which refers to the privatization of Newfoundland and Labrador Hydro, I am sure you would have no trouble in having this bill put through the House. Mr. Speaker, this has been tried twice before with what is being tried with Bill 2. That was tried back in the 1970s, and again in 1980, with the Partial Access Strategy which was unsuccessful of course, and the Reversion Act in 1980, which was unsuccessful. It was a bid at that time for total acquisition and, Mr. Speaker, we had seven judges rule against the privatization of Hydro at that point in time, back in 1980, and no to the Minister of Works, Services and Transportation. Pay attention; you may learn something.

Mr. Speaker, I have listened to the debate from members opposite, and there were very few people on the opposite side of the House who spoke, other than the Member for St. John's South and the Member for Eagle River, who, I believed, actually believe that the privatization of Hydro is a good thing. They have their own reasons for believing that.

The previous government, from my estimation, and it has been thrown across the House on many occasions, different negative responses to the previous government that was there for seventeen years, at least I have to say for that government at the time, and I had nothing to do with the government of the day, that they had the guts to try things, to try new ideas. They opened hospital beds; this government is closing hospital beds. They supplied dollars for infrastructure; this government has done nothing only cut, cut, cut, from those people.

What has this government accomplished in the past five years? After five years they have accomplished very little, in my estimation, only create havoc out there for many Newfoundlanders. Most Newfoundlanders now are worse off; they have no jobs, and no possibility of jobs.

The government supports Brian Tobin's resettlement program, and there is going to be hell to pay for that in due course, in my estimation. Once the fishermen out there in this Province understand the consequences of that brainchild, I suppose, of Brian Tobin, they will be quite upset, and this government has taken it lying down, the cut in $1.2 billion or $1.3 billion to the unemployment insurance - not a word - and they are the same bucks that are being transferred to the fisheries program. There has been no new money for that program. Basically what they are doing is taking from the poor and giving to the poorer, and making poorer.

Mr. Speaker, what else has this government accomplished in the past five years? I understand, speaking on this, because it is all interrelated, and I know the reason the government is trying to sell Hydro, of course, is to get a quick fix, some cash to solve their budget for next year, and maybe the year after, and that is the reason why I am talking about some of the issues with respect to the budget.

This government, in the past five years, has basically accomplished very little. They brought in a payroll tax. Now when they first brought it in, it was based on $300,000 gross salary.

AN HON. MEMBER: (Inaudible).

MR. J. BYRNE: Mr. Speaker, if the Minister of Works, Services and Transportation wants to yell across the House, I can let him know I can yell just as loud.

AN HON. MEMBER: (Inaudible).

MR. J. BYRNE: Okay, Sir, so that may settle you down for awhile.

Anyway, Mr. Speaker, when this payroll tax was brought in, it was based on $300,000 a year. That wasn't bad enough; that didn't cost enough jobs in this Province, so they had to base it on $100,000 a year. Now we have small companies with basically three or four employees not hiring, or afraid to hire, or laying people off so they can get under that $100,000 margin.

We have an income tax - I have a reason for this. I will get to the point shortly, if I have time.

AN HON. MEMBER: Oh, there is a point.

MR. J. BYRNE: Yes, Sir, there is a point.

We had the income tax increase over the past number of years also, and we have increases to every licence, fee, permit, that the government has issued, or does issue, and they have doubled and tripled over the past five years.

Mr. Speaker, a very important point, and this gets back to what I have been preaching over the past few years, and that is the resettlement program being promoted by the administration opposite, by the Premier in particular, revisiting the sixties, and that is the cuts and grants to the municipalities from 50 per cent to 60 per cent.

They have the debt retirement for certain municipalities doubled, so it is taken from one end - anyway, we will get to the point.

Mr. Speaker, the government employees in this Province also have been cut by thousands - thousands in the past number of years, since this administration took over. Of course, the spin-off effect, if you had thousands laid off from the provincial government, there are thousands laid off, of course, in private industry, and I don't know if the administration or the government of the day understands the situation.

Mr. Speaker, we have hospital beds being closed.

AN HON. MEMBER: (Inaudible).

MR. J. BYRNE: I will have the answer to that in due course.

This government, by the way, campaigned on opening hospital beds, opening hospitals and what did they do when they got in? Mr. Speaker, they closed hospital beds quite quickly.

Now, Mr. Speaker, we have the amalgamated towns - a situation where they're going to amalgamate towns to save money. Now I really haven't seen any benefits to that yet, to that train of thought, Mr. Speaker. As far as I can see, Mr. Speaker, this Province is no further ahead today then we were five years ago.

MR. EFFORD: We're a lot further ahead (inaudible).

MR. J. BYRNE: We have this government attacking the unions and contracts that were signed in good faith and tore them up, Mr. Speaker. The labour relations in this Province has been the worst it has been in recent history. I would like to ask the Minister of Finance, would he like to have $800 million a year going into the coffers of the Province of Newfoundland and Labrador, $800 million a year? Now, Mr. Speaker, we have that amount of money flowing to Quebec each year because of the Upper Churchill contract.

MR. ROBERTS: (Inaudible).

MR. J. BYRNE: We have $800 million - that's general knowledge and if the Minster of Justice doesn't understand that then he should start reading and learning because we are in poor hands if that is the case - $800 million a year, general information, Mr. Speaker.

I would agree, Mr. Speaker, that the government of the day thought back in the '60s, when they signed that contract, that it would be a good contract and maybe they had good reason for that. They thought that it would create jobs, it did create jobs and I have to agree with that. Mr. Speaker, who could really tell the future back then - and who can tell the future today? Who could predict the increases in the price of oil, the oil embargo of the '70s and these types of things that are happening, Mr. Speaker? The people were working at that time and I understand now - I mean I was only a very young teenager at the time - that both sides of the House voted in favour of that, all people on both sides of the House but they did not have the foresight, Mr. Speaker.

Why didn't they have the foresight? That gets back to the very important issue that we've been promoting and repeating and we have to repeat - the former Premier back in the 60s of the day, used to use the idea that you repeat and you repeat and you repeat something until it finally sinks in and maybe it's starting to sink into some of the members over there now. If the government of the day had to have public hearings, Mr. Speaker, this may have been brought to light, this problem that we have today. The fixed contract type of thing where we can't access the Upper Churchill power at all for a good many more years, Mr. Speaker. The people out there are afraid of the past mistakes. They are asking to be heard and this government is refusing to listen.

I would say to members opposite and to the Minister of Works, Services and Transportation who continues to interject, that it is a good thing that you have such a good opposition on this side of the House that we can give them the information with respect to Newfoundland and Labrador and the privatization of Newfoundland and Labrador Hydro. We want to avoid the past mistakes and the people of this Province want to avoid past mistakes. What did we do years ago? We gave away huge tracks of land to the railway so that we could have a railway across the Province and now we are buying it back. We gave tracks of land to the paper companies, Mr. Speaker, and here very recently we gave one of the paper companies in this Province $15 million to buy back that land. The fishery, back during Confederation, we gave away the rights to our fishery, Mr. Speaker, which was a major, major mistake and I have to compliment the Premier today on trying to get joint-management. I hope he's successful in that endeavour, I sincerely do hope that.

Mr. Speaker, the Upper Churchill - we gave away $800 million a year and I just went through that, Mr. Speaker - just to get it in the proper perspective, just sit back and think about this now, with respect to the Upper Churchill we are giving away $66 million per month, $2 million per day, $89,000 per hour, $1500 per minute and $25 per second, Mr. Speaker. Basically if a member -

AN HON. MEMBER: Repeat that again. How much?

MR. J. BYRNE: It's $66 million per month, $2 million per day, $89,000 per hour, $1500 per minute and $25 per second. So if the Member for Works, Services and Transportation was up speaking for half an hour that would have - as I've done - it would cost over $45,000 for a half hour speaking.

AN HON. MEMBER: Who signed that deal?

MR. J. BYRNE: Oh, we all know who signed that deal. There's no need to get into that.

Mr. Speaker, I have a solution. If I get time I will get into the solution with respect to the privatization of Hydro.

I would like to compliment another member today, Mr. Speaker, the member opposite, and that is the Member for Pleasantville who sent out his Pleasantville report - and I have a copy of it here, with twenty-two questions and answers from his perspective with respect to the privatization of Hydro. Mr. Speaker, I just want to refer to a couple. I will ask the question and give his answer.

Question number two in his report; will electricity rates rise as a result of privatization? The answer that the government member gives, yes, government estimates about $25 million in the first year, over $100 per year on the average bill. Other people say it will be more. This is because privatization will add $75 million to the rate base immediately, in addition to costing the government over $20 million, and because public utilities can be financed at less cost than private.

Question number four, should government sell if the majority of citizens disagree? This is the most important question and answer on this paper, Mr. Speaker, as far as I am concerned, and I said the same thing basically. Members of the House of Assembly should not act contrary to the clearly demonstrated wishes of their constituents. Members should try to make the case for what they believe is best for our Province, but should not impose what they are unable to persuade the people to support.

Mr. Speaker, many members on that side of the House as far as I am concerned are not representing the views of their constituents. The other morning I happened to be listening to CBC radio and we had five members, I believe, who were interviewed on that program, members for Trinity North, Port au Port, Harbour Main, Lewisporte, and St. John's North. Those members, Mr. Speaker, basically stated that there was very little opposition to the privatization of Newfoundland and Labrador Hydro in their districts. Now, that could very well be the case. I doubt it, but it could be.

A couple of those individuals stated that the fishery is a much more important issue overall, and who could argue. That is not the question, is the fishery more important or is Hydro more important? The fishery is a very important issue and that is the reason why this Province was settled, and we have to co-operate and come together on this very important issue with respect to the fishery.

Newfoundland and Labrador Hydro is also a very important issue and it strikes to the hearts of many people in Newfoundland and Labrador, and they want this privatization of Newfoundland and Labrador Hydro stopped, Mr. Speaker. We should do our utmost to do that, to stop that. I hope the members opposite will have the guts and the gumption in due course to stand up and be counted and represent the members of their district.

Another question on the Pleasantville report, as the Member for Pleasantville recalls it -

AN HON. MEMBER: Oh, oh!

MR. J. BYRNE: Do you want to? Come over.

MR. ROBERTS: Take it as read, boy, take it as read.

MR. J. BYRNE: Mr. Speaker, should we sell Hydro because we believe in free enterprise? The answer is no. That would be agreeing to sell regardless of price or of how much ownership might benefit the Province in other ways.

Would you do that in your personal affairs? Why burden the Province with guarantee costs or vague promises of future benefits? A very important issue.

MR. ROBERTS: Carried.

MR. J. BYRNE: I don't think this will be carried in the very near future, I would say to the Government House Leader, unless of course they bring in closure like they did on the privatization of Hydro.

SOME HON. MEMBERS: Oh, oh!

MR. J. BYRNE: Yes, sir. Hopefully.

MR. ROBERTS: The hon. gentleman has emptied the galleries.

MR. J. BYRNE: Mr. Speaker, I would like to say to the Government House Leader, seeing that he brought up that point, with respect to emptying the galleries, I have to say that the Government House Leader makes very moving speeches in this House of Assembly, and he moves me very often. The only pity is that it is mostly my bowels that he moves.

Question number 10, which is another very important one, would be: Would local investors benefit? The answer: Those who can afford to buy shares will benefit at the expense of our rate payers and taxpayers. For helping a few investors make quick profits will be very short-term justification for supporting such a proposal.

MR. EFFORD: You are not supposed to be reading a speech!

MR. J. BYRNE: I'm not reading a speech.

MR. EFFORD: You are so reading!

MR. J. BYRNE: I am reading something that a government member on your side sent out to his constituents. I would suggest - too bad he is not in the House now - that this is a very enlightening - would be a very enlightening paper if he would send it to all the members opposite. Hopefully they would take the time to read it and learn something, Mr. Speaker.

MR. SPEAKER: Order, please!

The hon. member's time is up.

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

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

MR. TOBIN: Thank you very much, Mr. Speaker. I want to have a few words regarding Bill No. 2 as well, and say from the outset that there are certain parts of Bill No. 2 that I don't have any difficulty with. There are certain parts of Bill 2 that I don't have any difficulty with, but there is also part of Bill 2 that I have some difficulty with, and that is the part that ties directly into Bill No. 1. And that causes difficulty not just for me, but for most people in Newfoundland and Labrador.

Mr. Speaker, one could only think and reflect about the situation that this Province finds itself in, a situation where the people of this Province can no longer afford increases in the cost of electricity rates.

If one were to look at the story in The Evening Telegram yesterday -

MR. EFFORD: That's the only way you get your questions.

MR. TOBIN: It's not the only way I get my questions, I say to the Minister of Works, Services and Transportation, but I can tell the minister I didn't see yesterday, in The Evening Telegram that the United Fisherpersons oppose the TAGS program. I didn't see anywhere in The Evening Telegram yesterday where the chairperson of the United Fisherpersons has come out against the TAGS program, nor did I see that the Fishermen's Union, Mr. McCurdy, has come out against it, so I would say they are lick alike, Mr. Speaker, the two of them - the chairperson of the Fishermen's Union and the chairperson of the United Fisherpersons.

MR. EFFORD: You shouldn't say fisherpersons - fishermen.

MR. TOBIN: Fishermen.

AN HON. MEMBER: (Inaudible).

MR. TOBIN: Okay then, Mr. Speaker, for the benefit of the minister, I will refer to them as fishermen.

AN HON. MEMBER: Fishers.

MR. TOBIN: No, they're not fishers either.

Mr. Speaker, there is no doubt that Rex Murphy knows the hon. minister very well, and it is obvious that Rex Murphy had a tremendous influence on the hon. minister since the weekend, because I could not help but smile when I saw Rex Murphy the other evening -

AN HON. MEMBER: (Inaudible).

MR. TOBIN: He got you. He said that you were a pussycat. Basically, he said the Minister of Works, Services and Transportation was a pussycat. The Member for Fogo knows that is what he said.

MR. EFFORD: (Inaudible) mistake, and I don't mind making a mistake. I made (inaudible).

MR. TOBIN: Mr. Speaker, how many mistakes does the hon. minister make?

MR. EFFORD: Only one.

MR. TOBIN: No, the Premier said you made a mistake. That is two.

MS. VERGE: The Pasadena highway is three.

MR. TOBIN: The Pasadena highway is three.

Anyway, Mr. Speaker, I believe I got sidetracked. The point I was trying to make before the Minister of Works, Services and Transportation -

MR. EFFORD: (Inaudible).

MR. TOBIN: Yes, that is, the people of this Province cannot afford an increase in their electricity rates. That is the point I was trying to make. All you have to do is look.

MR. EFFORD: What does that have to do with the price of fish?

MR. TOBIN: What fish? I say to the Minister of Works, Services and Transportation, what fish?

The fish that the United Fisherpersons -

MR. EFFORD: (Inaudible) fishermen!

MR. TOBIN: He said: `I am the chairman of the United Fisherpersons and we will take a strong stand.' The only stand they've taken in this House was a vote on Wednesday past when he got up and voted with the government to support the Government of Canada in gutting the fishermen of this Province. That is the only stand they've taken, Mr. Speaker, when he stood up and voted to gut the fishermen of this Province.

SOME HON. MEMBERS: Oh, oh!

MR. TOBIN: Yes, and he brought over the people from Iceland, Mr. Speaker, to solve the problems, and now he is part of the government that supports the attack upon the fishermen of this Province, supports the increases in the light bill for the people of this Province, and has gutted -

MR. EFFORD: (Inaudible) John Crosbie had to stand up.

MR. TOBIN: John Crosbie stood up stronger than you did, I say to the member. We saw your stand on Wednesday past when you stood with this government and voted to gut the fishermen of this Province. If it wasn't for Rex Murphy Friday evening, Mr. Speaker, he would still be a pussycat, I say.

MR. EFFORD: (Inaudible) pussycat I am.

MR. TOBIN: Mr. Speaker, that is very (inaudible).

SOME HON. MEMBERS: Oh, oh!

MR. SPEAKER: The hon. member's time has elapsed.

MR. TOBIN: Mr. Speaker, there are certain parts of this bill that I don't have a problem with that makes sense, and as it gets back, Mr. Speaker, to the portion where the recall of power and certain things like that are mentioned, we don't have a problem. But, Mr. Speaker, why has the government decided to tie Bill 1 with Bill 2? Why have they brought in certain areas? I think there are five different points in this piece of legislation, No. 2, that deals directly with the privatization of Newfoundland and Labrador Hydro.

The Minister of Works, Services and Transportation, for some reason today continues to be interrupting whoever is speaking. I don't know if it has anything to do with the fact that the Minister of Works, Services and Transportation went for a walk yesterday evening and happened to turn off the water - for his normal walk in the manhole.

AN HON. MEMBER: (Inaudible).

MR. TOBIN: No, Mr. Speaker, some people over here refer to him as Ninja Turtle and all that but I am not going to get into that.

MR. EFFORD: What?

MR. TOBIN: Ninja Turtles, the crowd who went down in the manholes and threw around all the pizzas.

AN HON. MEMBER: (Inaudible)

MR. TOBIN: No, Mr. Speaker, and if you were to listen to the Chairperson of the United Fisherpersons, he doesn't want to call it a manhole, he wants to call it a personhole. That tells you, Mr. Speaker, he said: don't call it a manhole, it's a personhole. Where is he coming from at all, Mr. Speaker?

There are five issues in this bill that deal directly and ties directly -

MR. EFFORD: (Inaudible).

MR. TOBIN: What's the chairperson saying, Mr. Speaker? There are five items and if he allows me, Mr. Speaker, I will list some of them. As a matter of fact, I am not sure that the Minister of Works, Services and Transportation agrees with me saying, Mr. Speaker, any more.

AN HON. MEMBER: Mr. Speakeress.

MR. TOBIN: Is that what you want me to say?

MR. W. MATTHEWS: Speaker, just Speaker.

MR. TOBIN: Chairperson. Okay, Mr. Speaker, I will adjourn the debate.

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

MR. ROBERTS: Mr. Speaker, I thank the hon. gentleman for his mercy in adjourning the debate. Amen.

Tomorrow when the House meets we shall be dealing with the Electrical Power Control Act so my friend from Burin - Placentia West will have an opportunity to come to the substance of his speech if there is any. He was just getting -

AN HON. MEMBER: (Inaudible).

MR. ROBERTS: I appreciate that.

The House will recall we are not meeting on Friday; we are adjourning on Thursday evening, I want to remind members so they can make arrangements and I don't know whether my friend from Lewisporte and my friend from Humber Valley have yet resolved the issue of the Mines and Energy Department estimates. That will have to be dealt with, and my understanding is yes, we will be back in the House at the end of this week, more or less. So with that said -

AN HON. MEMBER: (Inaudible).

MR. ROBERTS: Oh, Private Members Day is Wednesday and my understanding is, the gentleman from St. George's will speak to his motion, a most excellent motion. My hon. friend from St. George's will tell us about it for twenty minutes at the start and twenty minutes at the end and we will all be the better off, so with that said, Mr. Speaker, I move the adjournment of the House until two o'clock tomorrow.

On motion, the House at its rising adjourned until tomorrow, at 2:00 p.m.