June 7, 1993                                                                  RESOURCE ESTIMATES COMMITTEE


 

The Committee met at 7:30 p.m. in the House of Assembly.

MR. CHAIRMAN (Penney): Order, please!

I would like to welcome everybody to our final meeting of the Resources Estimates Committee. Tonight we will be reviewing the estimates of the Department of Forestry and Agriculture. I would like to welcome the minister, the hon. Graham Flight.

Before I introduce the Committee I will draw your attention to the fact that you have had distributed minutes of the meetings of June 1 and June 3. I would now entertain a motion to adopt these minutes as distributed.

On motion, minutes adopted as circulated.

MR. CHAIRMAN: I will now introduce the members of our Committee. My name is Melvin Penney. I am the member for the district of Lewisporte, and I will be acting as the Chairman for this meeting tonight.

AN HON. MEMBER: Only acting.

MR. CHAIRMAN: Only acting. On my immediate left is the Member for Humber Valley, Rick Woodford. The other members of our Committee are: the Member for Baie Verte - White Bay, Paul Shelley; the Member for Fogo, Beaton Tulk; the Member for Harbour Main, Don Whelan; the Member for Kilbride, Ed Byrne; and the Member for St. George's, Dr. Bud Hulan.

The role of the Chairman in these proceedings is very similar to that of the role of the Speaker of the House of Assembly. It is quite simply to maintain order and decorum. I would like to remind everybody here tonight though that it is a much more informal setting. The dress code is relaxed to the point that you can remove your jackets and ties, if you prefer. As well, you can have a cup of coffee or tea brought into the Chamber, which is something that is not permitted during House of Assembly proceedings. It is not necessary to address anybody by title. We are familiar with addressing members by the district they represent, but for tonight everybody can be addressed by name.

I would like to recognize our Table Clerk for the night, Mr. John Noel.

The procedure that we have been using for these meetings is that we will allow the minister fifteen minutes for his opening remarks and then we will allow the Vice-Chairman fifteen minutes to respond, unless the Vice-Chairman wishes to have somebody else designated to do that. Then we will allow it to go ten minutes each to the members of the Committee. I have asked in previous meetings, and will do the same again tonight, instead of making a ten-minute speech and expecting the minister then to reply to twelve or fifteen questions hidden in the speech, that we use a system very similar to what we use in the House of Assembly during Question Period: the member will ask a brief question and I will ask the minister to co-operate with a brief answer and when his ten minutes are up we will go to another member. If the member has not asked all the questions that he wishes to have asked, then I can assure him that the Chair will get back to him again. This procedure has been followed, not to the letter, I suppose, but fairly accurately over the previous meetings, and I will ask for co-operation from everybody tonight.

I remind the minister's officials that they are permitted to answer questions only if directed by the minister to do so, and I remind the members of our Committee that they are not permitted to question the officials - their questions must be directed to the minister. If the officials answer any of the questions directed to them by the minister, they must restrict their answers to items of fact and not delve into anything related to policy.

Since the microphones are designed for a person to speak into from a standing position, I ask members and the minister's officials to lean into the microphones when they speak. For the sake of Hansard staff, who will be transcribing everything that is said here tonight, I ask the officials to introduce themselves each time before speaking.

I think that just about covers everything that needs to be said. I now ask the minister if he will, for the record, introduce his officials and then he could proceed directly into his fifteen-minute opening comments. Mr. Minister.

MR. FLIGHT: Thank you, Mr. Chairman.

First, let me say that my officials and I appreciate the opportunity to appear before your Committee, such an august bunch as I am looking at across the way, obviously well-informed.

I would like first, as you said, Mr. Chairman, to introduce my officials. On my immediate right is Mr. Bob Peters. Bob is a Deputy Minister of the Department of Forestry and Agriculture; on his immediate right is Dr. Mohammed Nazir, the Assistant Deputy Minister responsible for the forestry side of the department; and on his immediate right is Mr. Len Clarke, the department's Director of Finance; on my immediate left is Mr. Martin Howlett, the Assistant Deputy Minister for the agricultural side of the department.

Mr. Chairman, I am going to do as you suggest, lead with an opening statement. I don't think it will take fifteen minutes - I hope, as a matter of fact, it will be less than ten. I do have some notes prepared for me and I will basically read the statement right into the record, but before I start, I have to tell members of the Committee that I have been hearing all kinds of rumours that these hearing are winding up in an hour-and-a-half when three hours were designated, and to remind them all that at 10:30 p.m. my favourite hockey player comes on TV. Mr. Gretzky faces off against the Montreal Canadians. So, anybody who wants any favours from the Minister of Forestry, this is in the record, they had better be cognizant of the time, 10:30 p.m.

MR. TULK: I am urging the minister to keep (inaudible) from politics - that is all I am afraid of.

MR. FLIGHT: No, no there is no question about that - no worries about that. Don't worry.

MR. TULK: (Inaudible).

MR. FLIGHT: Mr. Chairman, I have two sets of notes here because it is the Department of Forestry and Agriculture, having been, at one time, pretty well line departments. So, in my speaking notes, I will deal with the forestry side of the department, Mr. Vice-Chairman, and then deal with the agricultural side of the department in the same opening remarks as opposed to doing it -

MR. CHAIRMAN: That is the procedure we would prefer, Mr. Minister.

MR. FLIGHT: In the Budget, as everyone knows by now, the forestry side of the department is dealt with, then it goes into agriculture, and they are not intermixed in the Budget. In any event, Mr. Chairman, during these tough economic times, and we don't need any elaboration on that, there is not a lot to cheer about. However, we feel satisfied that we are doing our best to manage the forest resource of this Province and to ensure the viability of the forestry industry and continued flow of non-timber goods and values for this important practical resource.

I am glad to say that the three pulp and paper mills have managed to hold their own during this recent recession. In fact, total production of newsprint was slightly higher in 1992 as compared to the previous year, and I am hoping the pulp and paper industry will be on its way to recovery and improved profits.

Similarly, the sawmilling industry continued to provide some cushion to an otherwise ravished economy of this Province. In fact, three of the Province's sawmills started exporting lumber for the first time since the early 1920s. The lumber prices have improved significantly and should result in further improvements in the industry.

My department's main forestry mandate is management of the forest resource. The 1993 Budget provides for expenditures directed at enhancing the productivity of the forest resource, its adequate protection against fire and insects, and its proper use. I will explain some of these initiatives in a little more detail in a few minutes.

I want, however, to advise this Committee, and through it, the hon. House of Assembly, that forestry in Newfoundland is currently undergoing transformation of revolutionary proportions. This transformation relates to changes currently under way which require the management of the forest resource on sound, ecological principles, and provides for integrated use of the resource for wood production and various non-timber values and uses. The department has established a very elaborate system of internal reviews and planning for making this change a reality. This fits quite nicely with the government's commitment to sustainable development.

Under the current Canada/Newfoundland co-operation agreement on forestry development, the department's program either directly, or through cost-shared agreements with the pulp and paper companies, will result in silvicultural treatment of about 13,000 hectares of forest land. Approximately 7.6 million trees will be planted on Crown and company-held forest land. Over 5,500 hectares will be thinned to enhance the growth rate of young forest stands. Other silviculture treatments will include restoration of old high graded forests to new, vigorous stands, preparing forest areas for next year's planning programs, and the control of competition. The cost-shared funds will also help continue the private woodlot program in the Western part of the Island and on the Avalon. Currently, there are eighty-seven woodlots involved in the program. Others are joining on a steady basis.

The department will continue to provide assistance to the sawmilling industry in technology development and technology transfer. It will also be supporting the work of the Newfoundland Lumber Producers Association in improving the viability of the sawmills.

Another cost-shared program is the Forestry Youth Training program, which is in its last year of existence and will see an expenditure of $1.2 million in training young people for various silviculture operations.

While we have been fortunate during the last few years that we did not have insect epidemics of the proportion of the 1970s, we still have significant infestation of hemlock looper and some pockets of the spruce budworm. We will therefore be treating approximately 20,000 hectares of forest in Bay d'Espoir and Central Newfoundland with the biological insecticide Bt. This program is cost-shared with the pulp and paper companies.

This year's budget provides for an ongoing level of forest access road maintenance which is the bare minimum. Despite our desire to increase the funding available for this purpose, we had to live with the reality of constraints. I am, however, very pleased that this year's budget provided almost 100 per cent increase in capital funds for construction of forest access roads. This was necessary and important to access the wood for maintaining the wood supply to the industry. I feel a certain amount of satisfaction on this increased funding for improving access to the forest resource.

At the end, I want to acknowledge a serious situation with availability of federal funding for forestry. The current Canada/Newfoundland co-operation agreement on forestry development expires on March 31, 1995. The Federal Government, last Fall, reduced funding in the remaining two years of the agreement. Again, in last month's budget the Federal Government announced its intention to totally withdraw from forestry agreements after the expiry of the current agreement.

The forestry program in the Province depends very heavily on federal funding. I shudder to think of the consequences of lack of dedicated long-term funds for silviculture and other forestry development activities. I raised the matter with the federal minister responsible for forestry and I will be pursuing vigorously the continuity of funding for silviculture and other important forestry programs.

I might add, Mr. Chairman, for the last three years we spent approximately $12 million per year in silviculture, and when you understand that 70 per cent of that money last year, and in previous years, was Federal Government money under the agreement, and that the Province would have spent approximately $3.5 million out of a total of $12 million, you can imagine the devastation to our forest enhancement programs and silviculture programs if the Federal Government doesn't change its mind and is not prepared to negotiate any new forestry agreements.

That concludes the comments relative to the forestry side of the department, Mr. Chairman.

MR. CHAIRMAN: The minister should be informed that if he were to take more than the designated fifteen minutes, the Chair will be more than lenient and all we will do is just allow an equal amount of time for the Vice-Chair to respond, so there is no problem.

MR. FLIGHT: Surely - of course.

Mr. Chairman, this past year has been an extremely busy one for both the agriculture industry and for government. Last year, 1992, saw farm cash receipts top $62 million, which was an increase of just under 3 per cent over 1991.

Let me highlight some of the activities of the past year and also some of the planned activities for the next year. Last June, as everyone is aware, government released Change and Challenge: A Strategic Economic Plan for Newfoundland and Labrador. I need not elaborate any further on the overall strategy; however, I do wish to take some time to outline its status with respect to the agriculture industry.

The strategy stated a provincial meat inspection program will be established. Draft standards and regulations have been prepared by the department and are now being forwarded to other interested departments for consultation. Training is under way for three inspectors and has started for the regional veterinarians. Equipment purchases and laboratory renovations are almost complete. An evaluation of the current facilities has been undertaken and implementation of the program is expected this Fall. Funding has been secured in 1993-1994 to continue and expand our research and trials utilizing local feed sources to livestock and poultry feeds. In the past couple of years, the department has carried out work with fish offal and meal - actually, we are talking about the seal meat program. Four feeding files were implemented and two feeding files have been completed that investigated the use of this offal as a protein supplement for growing lambs. These investigations have shown that further work would be very beneficial. Work is also under way or planned to determine the feasibility of feeding offal to broiler chicken and dairy cattle. Funding has also been approved in the 1993 Budget under the Strategic Economic Plan to assist producers in the construction of vegetable storage, thus allowing industry to expand their marketing season. A lack of good quality storage is a major impediment to this sector of the industry.

Again, as in the past two years, $150,000 has been allocated as government's contribution towards the school milk program. We have worked closely with Municipal Affairs and in consultation with the Newfoundland and Labrador Federation of Agriculture with respect to an equitable and standard municipal tax structure for farms, and I expect to be bringing a paper to Cabinet shortly to deal with this matter.

Several of the items in the Strategic Economic Plan can only be accomplished through a federal/provincial cost-shared agreement. The Canada/Newfoundland Agri-Food Development Subsidiary Agreement has been extended to March 31, 1994 but we are now seeking additional funding. While the Province is ready and anxious to sign, the Federal Government has yet to give its formal approval. Program details have been worked out in anticipation through the co-operation of both levels of government and industry. What I am referring to here is the extension to the Agri-Food agreement, worth approximately $2.8 million to the Province. The details have been worked out and we are ready to sign but the Federal Government has not, to this point in time, seen fit to sign the agreement which, in effect, means that we don't have access to that $2.8 million. But we are living in hope that the Federal Government will, indeed, sign the agreement and flow the funds so that we can continue with the type of work we are doing under the Agri-Food agreement.

A farm management agreement has also been signed, for which a total of $1.8 million has been committed to this program over a three-year period beginning in the fiscal year 1992-1993. Last year, I spoke of one of the issues facing the industry, that of the GATT negotiations and its potential impact on supply management. To date, no agreement has been reached and formal talks are expected to begin again this Fall.

In conclusion, let me add that the commitment of this government to the supply/manage commodities remains unchanged and we continue to support Canada's negotiating position at the GATT talks with respect to agriculture. That, Mr. Chairman, concludes my opening remarks.

Mr. Chairman, if I could make a correction: When I was reading the statement a little earlier, I said, a farm management agreement has also been signed. My assistant deputy tells me I said a total of $1.8 million, but it really should be $1.08 million. A little over - not quite $2 million. A total of $1.08 million has been committed to the program over a three-year period, beginning in the fiscal year 1992-1993.

Mr. Chairman, having concluded my comments, I will look forward to the comments of the Vice-Chairman or any members of the Committee.

MR. CHAIRMAN: Thank you, Mr. Minister. I now turn it over to the Vice-Chairman for his fifteen-minute response.

Mr. Woodford.

MR. WOODFORD: Thank you, Mr. Chairman.

MR. TULK: This is not so much a point of order as just a clarification.

MR. CHAIRMAN: A point of order, Mr. Tulk.

MR. TULK: I was under the impression that always after the minister had spoken you allowed the shadow or the Opposition critic to reply for fifteen minutes. That was always done.

MR. FLIGHT: That was always done, yes.

MR. TULK: It is four years since I was here, but that was always the procedure.

AN HON. MEMBER: It was by leave, wasn't it?

MR. CHAIRMAN: The Chair is quite prepared to allow that to happen. I think if you recall, what I said was, it will be the Vice-Chair or his designate, and it is entirely up to him whether he wants to designate any particular person.

MR. TULK: I notice that has been happening in this Committee - the Vice-Chair knows all.

MR. FLIGHT: To that point of order, Mr. Chairman. In this particular case -

MR. TULK: There are two very intelligent young men back here, one in forestry and one in agriculture.

MR. CHAIRMAN: Order, please! Order, please!

MR. FLIGHT: To the point of order, though, in fairness. If you remember, Mr. Chairman, last year the critic was the Vice-Chair.

AN HON. MEMBER: (Inaudible).

MR. FLIGHT: Yes, okay. I just thought I would make that point. The Vice-Chair was, indeed, the official critic of the department, so that made it easier, I suppose.

MR. WOODFORD: Mr. Chairman, to that point of order. There is nothing in the Standing Orders and nothing in Beauchesne or anywhere else to say who can respond in a committee, whether it is the shadow or not. Because, in most cases, the shadow or the critic is not even there, not even a member of the Committee. He would have to be designated as a member of the Committee over and above the three members who are already on it. I say to the hon. the Member for Fogo, it being four years since he was in the House, he probably should get a new copy of the Standing Orders and just take a look.

MR. TULK: Well, I don't want to (inaudible) the Member for Humber Valley.

MR. WOODFORD: Yes, I figured that, but I figured everything was a bit too quiet.

AN HON. MEMBER: (Inaudible).

MR. CHAIRMAN: Order, please! Order, please!

The Chair would appreciate hearing one person at a time.

To that point of order, there is no point of order. I remind members that the Committee is the master of its own destiny. In this particular case, the decision has already been made and the ruling of the Chair is that the Vice-Chair will respond unless he designates somebody else to do so.

I will again recognize the Vice-Chairman. Your time will begin as of 7:55 p.m.

MR. WOODFORD: Thank you, Mr. Chairman, and thank you, too, for the protection of the Chair.

Mr. Minister, you mentioned the Agri-Food extension. I understand that was supposed to be an extension in which the funding would come from ACOA.

MR. FLIGHT: Through ACOA.

MR. WOODFORD: Through ACOA. So, you people are ready to sign that and it is held up by the feds. Is there anything new on that in the last few days?

MR. FLIGHT: It has been budgeted because we were so sure that we would have the agreement. The amendment was negotiated and agreed to by both sides but the money had to flow through ACOA, and when Mr. Mazankowski indicated that they wouldn't be renewing the subsidiary agreements they also apparently included, in their way of thinking, the two amendments. As a matter of fact, there is one for forestry and agriculture.

MR. WOODFORD: Has there been anything new in the last few days?

MR. FLIGHT: No, every day I ask and we are still waiting and hoping that they will, indeed, sign. Shortly we will - I realize I am taking up your time and I am prepared to let you have all the time you want. We have to - it is coming to a head pretty soon because we have programs ongoing that are intended to be funded by those amendments, and the time will come when those programs will have to be dead-ended and people laid off.

MR. WOODFORD: Not only that, whether the funding is there or not right now, the season is here and people want to get moving. I talked to them on it last week and I understood there might be something as of last Friday.

MR. FLIGHT: No.

MR. WOODFORD: Mr. Minister, Abitibi-Price: last year the subject came up pertaining to the importation of pulpwood from outside the Province, and as well, from the Island part of the Province and Labrador. I understand now that Abitibi is thinking about bringing in another ten or eleven bargeloads from Labrador. Will there be any subsidy paid on that? There is rumour out my way now that there is possibly a subsidy being paid for Abitibi to bring that in. Is that true or not?

MR. FLIGHT: No, there is no subsidy paid from Labrador but the Federal Government, under the Maritime Freight agreement -

MR. WOODFORD: Freight Assistance.

MR. FLIGHT: Yes, Freight Assistance. The Federal Government provides a freight subsidy for the wood that came from PEI last year, but there is no freight subsidy for wood being barged from Labrador to Newfoundland. It was purely a freight subsidy that was paid. The Province is not subsidizing in any way, shape or form, nor is the Federal Government, other than providing the freight subsidy that is there anyway, that they can take advantage of if they move wood from PEI to Newfoundland.

MR. WOODFORD: Yes but did you - I couldn't get hold of anybody from Abitibi this evening. Did you hear anything about them bringing in these ten or twelve bargeloads?

MR. FLIGHT: They intend to bring in 30,000 metres from Labrador, 30,000 metres from Bay d'Espoir and 30,000 metres from PEI this year.

MR. WOODFORD: I can understand them bringing in wood, regardless of where it is from, I mean, you need wood to run the mill, but I can't understand their turning down wood that is so close to the mill. Why won't they take the - there are cutters out there for the last ten or twelve years and they won't take their wood.

MR. FLIGHT: I say to the hon. member, this causes me concern, and as the member knows, last year the arrangement or contracts or whatever, had been signed before we even became aware that there was wood coming from PEI. It concerns us very much, and I had many meetings with Abitibi-Price about it, but it is a fact of life, apparently, that they can deliver PEI wood to the mill in Stephenville more cheaply than they can get wood from any source in Newfoundland. So, I would say that our industry has problems from that point of view.

MR. WOODFORD: Our fellows now, on the West Coast, have been told that they can distribute four loads in June, and the maximum that they can take off some operators is fourteen in July, and that is it for the year. I mean, that is terrible.

MR. FLIGHT: But, in the meantime, remember that the 30,000 metres that comes from PEI - what is that? about 12,000 cords. But that is really still only a drop in the bucket compared to Abitibi's overall requirements that they will get on the Island.

MR. WOODFORD: Yes, and they want fresh wood and they want it freshly cut.

MR. FLIGHT: Yes.

MR. WOODFORD: And there is wood that is close to the mill but yet, they have been told - I had three phone calls this weekend from people saying that they have been told, `that is it' after July; and the wood is spruce, which is what they are looking for.

AN HON. MEMBER: (Inaudible).

MR. WOODFORD: It is spruce and it is a good fibre plant.

MR. FLIGHT: The best fibre, obviously, is the wood from Labrador.

MR. WOODFORD: Yes, that is right.

MR. FLIGHT: Again, while we are into this, I might say for the Committee's information that the PEI wood justifies their bringing in the Labrador wood and the Bay d'Espoir wood because (inaudible).

MR. CHAIRMAN: Order, please!

I ask the minister if he could speak into the microphone. We are having some problems getting the volume picked up.

MR. FLIGHT: I am sorry.

They are justifying, if they need to justify, I guess, bringing in the PEI wood on the basis of the low cost of PEI wood and the high cost of Labrador wood and Bay d'Espoir wood. The fact that they are bringing the 30,000 metres from PEI justifies, from a cost point of view, bringing the wood from Labrador and Bay d'Espoir. It is a blended price, and the low cost of the PEI wood makes it possible, economically, for the company to bring 30,000 metres from Labrador and 30,000 from Bay d'Espoir.

MR. WOODFORD: On the access roads for the year, Mr. Minister, Chouse Brook especially - I understand the contract is called for the White's River - Bridgers Pond area, in the Chouse Brook area. I have been told that wildlife has some concerns pertaining to that particular section, the next section to be done. Is that so, and is that why the tender for it has not been let?

MR. FLIGHT: No. The real reason, I say to the member, is that the wildlife people have some concerns that they want resolved relative to the Chouse Brook Road, and our information is that will be resolved shortly and we will be calling a tender for an extension.

MR. WOODFORD: So the concerns are not enough to really stop the project from going ahead?

MR. FLIGHT: No, we don't think so.

MR. WOODFORD: They had some concern, I think, pertaining to the caribou calving grounds there, and it didn't make much sense when there were roads on either end of it.

MR. FLIGHT: My information now is that we will be able to resolve the concerns of wildlife in the next few days and then tender the extension.

MR. WOODFORD: With respect to the agricultural sector, Mr. Minister - even in the Strategic Economic Plan, I think, it has been addressed - there has been some talk for the past couple of years about raising the limits to the Farm Loan Board from $75,000 up to at least $150,000. As you know, there are no limits now anywhere, I don't think, in Atlantic Canada. I don't think PEI, New Brunswick or Nova Scotia have any limits - I don't think there is a limit on it.

Is there anything new on that particular item? Has anything been done? There is nothing in this year's budget again. Is it possible there will soon be something on raising the limits to the loan board?

MR. FLIGHT: Yes, I want to inform the member that in the very near future, as a matter of fact, I will be going to Cabinet for approval to raise the limits, and I think we are talking - because there is a limit in Newfoundland, as you know, of $75,000.

MR. WOODFORD: Seventy-five thousand, yes.

MR. FLIGHT: We are looking at a limit of upwards to at least $150,000 for the first move, anyway, and I expect that will be approved.

MR. WOODFORD: There will be something on that soon?

MR. FLIGHT: Very soon. The process now, I guess, is the Cabinet committee process, and I will be asking that it be dealt with as quickly as I can get it to Cabinet.

MR. WOODFORD: Your Green Plan, Mr. Minister, in agriculture - I think it is 3.1.06: Green Plan Administration - Grants and Subsidies of $75,000.

MR. FLIGHT: Yes.

MR. WOODFORD: What is the status of that plan now? What is this $75,000? What is going to be done? What are the plans for it?

MR. FLIGHT: The Federal Government is paying 100 per cent of the capital cost of the Green Plan, as indicated here, $75,000. That is current account - I'm sorry, yes, it's the current account portion that the Federal Government funds 100 per cent. We spend the money, I guess, and get the money back from the Federal Government. Are you asking me what we are doing with that $75 million?

MR. WOODFORD: Yes. Seventy-five thousand is in here. Is it signed?

MR. FLIGHT: It is basically for environmental improvement and, yes, it is signed.

MR. WOODFORD: It is signed.

MR. FLIGHT: Yes. Isn't it?

No, the ADM reminds me, Mr. Vice-Chairman, this is not in place, but we budgeted for it because there is every expectation that we will have this particular - and what it is for, is environmental improvements on farms. It is almost 100 per cent, actually. The environmental sustainability initiative is a program designed to take action in a number of areas, including soil conservation, water management and waste management. Action can include technical or financial assistance for research, demonstration, monitoring and awareness, but is by and large environmental.

MR. WOODFORD: An environmental program.

MR. FLIGHT: Yes.

MR. WOODFORD: Is there an agreement signed with the feds? I understand PEI has one signed. Do we have one signed?

MR. FLIGHT: On this agreement?

MR. WOODFORD: Yes.

MR. FLIGHT: No, the agreement, itself, is not signed.

MR. WOODFORD: What is the hang-up? Because everything seemed to be in place with respect to that program. Why would there be a hang-up on signing that?

MR. FLIGHT: There is no hang-up, Mr. Chairman.

MR. WOODFORD: Or further implementation.

MR. FLIGHT: It is going through the process. The hon. member will know - and we know the kind of work we intend to do with the funds that are available. Was it a three year agreement - funding over three years? It is funding over three years and this is the first year of the agreement. We have budgeted for the program. It is in process and it is negotiated. There is no indication that there will be a problem in actually signing the agreement.

MR. WOODFORD: Last year, didn't they have 50 per cent up to a maximum of - forty or something like that. Pertaining to manure pits.

MR. FLIGHT: That was under a different agreement, though, it was under the Environmental Sustainability agreement.

MR. WOODFORD: For one year, that was, I think.

MR. FLIGHT: Yes, for one year.

MR. WOODFORD: So the other one is not in. Mr. Minister, the contract for the White's River road, that is out, isn't it? Is the tender out on that? The White's River - Bridgers Pond area.

AN HON. MEMBER: The White's River road.

MR. FLIGHT: Tenders have been called for that.

MR. WOODFORD: Tenders have been called.

MR. FLIGHT: Yes.

MR. WOODFORD: Are there any other agreements around the Province now, something like the one we have in Chouse Brook and White's River, with Abitibi-Price or Kruger?

MR. FLIGHT: You mean land transfers? We are talking to the companies all the time but there isn't one of the magnitude of either of those. There is the St. Margaret one on the Northern Peninsula, Chouse Brook and White's River road, but there is nothing of that size being talked about to Abitibi or Kruger right now.

MR. CHAIRMAN: The Chair now recognizes Dr. Hulan for ten minutes.

DR. HULAN: Mr. Minister, it is a little different sitting across from you and calling you `Mr. Minister,' Sir, but I am happy to do that. I have a couple of questions on, first and foremost, forestry - although I notice that `A' always comes before `F' but it is always Forestry and Agriculture. I tend to turn it around, you know, put the `A' before the `F'. Anyhow, I have a couple of questions on forestry.

I was pleased to get some material from the department some time ago, from the deputy, on the new proposed forestry agreement, which I have gone through. I was very pleased to see what your department has been doing with regard to private woodlot management. It is something that has been long overdue in this Province. Coming from an agricultural background, as I do, and from a farm that had a fairly large woodlot to manage, I commend the foresight of those in forestry in going in that direction. As I said, it is long overdue.

One of your assistants will be able to answer this: What total acreage is involved now in private woodlot management, and what is the rate of increase over the next five years, for instance?

MR. FLIGHT: I don't know if Dr. Nazir could give me the acreage. Off the top of my head, I know we have eighty-seven private woodlot operations in Newfoundland right now, and that is a major improvement over the last few years. Most of them, by the way, or a lot of them, are in the hon. member's district, as he will know. Do we have the information?

AN HON. MEMBER: (Inaudible).

MR. FLIGHT: I say to the hon. member, we don't have it, and there is no point in wasting the Committee's time on it now, but I will prepare that and make sure it is made available to the hon. member.

As I indicated, there are eighty-seven private woodlot operations. I don't have the information the member asked for. Maybe my officials will have it before the night is over; if not, I will provide it to the Committee.

DR. HULAN: The other area that I am keenly interested in, and again, because of what has happened over the years on the West Coast of the Island with so much clear-cutting, is your silviculture program. My understanding is there is going to be a sizeable reduction in that program. Is that fair to say?

MR. FLIGHT: Not this year.

DR. HULAN: Not this year.

MR. FLIGHT: Or next year.

DR. HULAN: Okay.

MR. FLIGHT: Because the funding for silviculture is, by and large, under the agreement, 70-30 and, as I indicated, we spend about $12 million per year in silviculture. Silviculture encompasses site reclamation, planting, thinning. We have the same level of funding this year as we had last and there is no reason to believe it will be less next year.

The big concern, as I said earlier, is that if the Federal Government decides to dead-end those co-operation agreements, then our silviculture spending would be cut by at least 70 per cent, which would be devastation to that particular industry. But there is no reduction from last year, in the amount of money being spent on silviculture this year. I would say, by now we have identified most of the areas where silviculture will take place - the areas for planting and thinning and site reclamation.

Now, the paper companies - we cost-share the paper companies' silviculture programs. In conjunction with the department, they determine where on their limits they want the silviculture dollars spent, and whether it is in thinning or planting. We are responsible for the silviculture treatment on Crown land, as the hon. member would know, and again, as he knows also, the bulk of his district is Crown land. The Bay St. George area always accounts for a fairly hefty portion of the Crown lands silviculture budget and I don't know that there is any reason to think it would be different this year.

DR. HULAN: The other area I want to touch on - and again, I am pleased to see it receiving some attention - is the whole issue on the private sawmilling operators in the Province. You know, we bring in an awful lot of materials to build a house when really, years ago, that wasn't the case at all. I think, about 85 per cent or 90 per cent of the materials going into houses now are imported.

The sawmilling industry, of course, is suffering, at least in the area where I come from, because of inaccessibility to sawing logs. What is the situation in the future with regard to the large paper companies and the number of sawing logs that will be available to private small operators? I understand that is about to change somewhat - there are negotiations under way.

MR. FLIGHT: We do land transfers with the paper companies and normally, any of those land transfers are driven by our desire to provide a sawlog supply to the sawmillers. We demand 100 per cent utilization so the sawlogs go to lumber and the pulp goes back to the company by way of pulpwood or chips. As the member indicated, we are negotiating with both paper companies to have sawlogs on their limits even if the sawlogs are cut by their employees. We are negotiating with the companies to have arrangements where the sawlogs go to private sawmills and we are obligated, of course, to provide the fibre back in return.

As a matter of fact, there have been meetings held in the past and I will be sitting in on meetings very shortly where I will be looking to get a progress report from the companies' point of view. My officials are aware and keep me briefed as to what is happening with those talks, but I will be looking for some sort of progress report from the companies as to just how far they have advanced towards making sawlogs off their limits available to the sawmilling industry.

I think, if we are going to retain a viable sawmilling industry in this Province, we are going to have to access sawlogs off company limits. One of the reasons why sawmill industries cannot expand now is because of the unavailability of sawlog material on Crown limits. I am constantly saying no to sawmill operators who want to expand their operations and increase their production, but I just don't have the timber available on Crown lands, that is if we are going to manage our forests on a sustainable basis and to guarantee that we are not overcutting and it is all gone in ten or fifteen years. We are getting enough sawmills in this Province now, and with the kind of technology and the rest, if the Department of Forestry were to permit them to cut what they want to cut, or permit them to cut what they know they can market, we would probably be devoid of forests in certain sections of Newfoundland in the next ten years.

So, that is the challenge, maintaining the production and helping to increase production but, at the same time, managing the forests on a sustainable basis. To do that and to even maintain the present rate of production, we have to get an agreement with the paper companies, and you don't need sawlogs to make pulp. The companies understand that, the economics and everything else, but it can be worked out. In fairness to the companies, they have indicated willingness and are receptive to that idea. Five years ago that would have been unheard of, I think, but the companies are starting to accept the argument and they are receptive to co-operating and helping us to achieve that. Where sawlogs off their limits are made available to our sawmilling industry, we have to provide them, of course, with the fibre in return. We can probably manage to do that off Crown lands if we are getting the sawlogs off company lands, because they get 70 per cent of the tree anyway, whereas only 30 per cent is turned into lumber. This has been a long convoluted answer but I hope I dealt with some of the question.

DR. HULAN: One final question, Mr. Minister.

Because of the serious problem that is created in this Province as a result of clear-cutting, the serious problem with regard to soil erosion - let us take the worst scenario, in which we lose 70 per cent of the dollars that might be going into a proper silviculture program in the near future. Are there any other plans in mind to put in place to prevent soil erosion? Because it takes about 100 years to replace one inch of topsoil in this Province because of our climatic conditions and so on. Is there something else in mind to - if you can't plant trees, if we don't have a silviculture program, we had better get something under for a cover.

MR. FLIGHT: Well, you know, we don't plant - when you talk about clear-cutting in Newfoundland, if you compare our clear-cuts to those even of New Brunswick or definitely of British Columbia, ours are very small. As a matter of fact, we prefer to refer to it not so much as clear-cutting as selective cutting in the sense that the clear-cuts aren't that big, and there is no other way - not with the requirements of the companies these days.

I think it is fair to say that we do not, and would not if we had the money, plant most of the clear-cuts because, as you know, there is great regeneration in Newfoundland. So, even with the $12 million, we only identify the areas that will not regenerate, or for some reason are not regenerating naturally, and we go in and do a site reclamation and plant. It is fair to say that the bulk of the clear-cuts, or the bulk of the forest harvest in Newfoundland, whether it is clear-cutting or selective cutting, regenerates on its own and therefore we do not treat it silviculturally.

Most of our silviculture expenses now are being directed to thinning as opposed to planting, and the reason is simple. When you plant a tree you have to wait seventy years to harvest it. If you thin one, it gives you that tree twenty years quicker than it would if you didn't thin. So, from the companies' perspective their money is better spent and our hours on Crown by thinning as opposed to planting.

DR. HULAN: I thank you, Mr. Minister, for referring to the fact that it does take seventy years to grow an acre of trees, but one year to grow an acre of cabbage.

MR. FLIGHT: It is the same principle, by the way.

MR. CHAIRMAN: Mr. Shelley.

MR. SHELLEY: Thank you, Mr. Chairman.

I want to start off by telling you, Mr. Minister, regarding the Federal Government's intention to cut back on silviculture, I am very concerned also and I am pursuing that. As a matter of fact, I did so when the leaders were here - the potential leaders. We brought it up with them then, I will be doing it again this weekend, and I will continue on with you, also, because I think it is very important to this Province. They have to reconsider that, I think, and we have to push from both sides of this House on pursuing it.

The first one I will get into, and I suppose it is more for learning regulations and clarification, is on the harvesters. How many harvesters in the Province are operating right now? That is the first question - in some area, anyway. Just generally, how many men working in the woods is equivalent to one harvester, for example? I am trying to get some reading on the number of harvesters.

MR. FLIGHT: As the member will understand, I am sure, I may have to take some of those questions under advisement and supply the answers to the Committee.

MR. SHELLEY: Okay, that is good.

MR. FLIGHT: We don't have the figure available to us, on how many harvesters are operating in the Province. We can get it.

MR. SHELLEY: It can be gotten, okay.

MR. FLIGHT: We can get it from the paper companies.

MR. SHELLEY: Okay.

MR. FLIGHT: We have taken note of the question, I say to the hon. member, and I will provide the answer just as quickly as I can, most likely tomorrow.

MR. SHELLEY: Okay. I have heard some general statements, but one of those harvesters, how many men does that replace - ten, eleven, or something?

MR. FLIGHT: I have heard as high as - I guess it depends on what you are talking about. If you are talking about how many loggers it would replace if you were working with the bucksaw, or with skidders - so it changes. But I tell you that there is a great difference in the number of men required to harvest a cord of wood with skidders and chain saws as compared with a harvester.

MR. SHELLEY: Okay, just in general.

MR. FLIGHT: I am not sure that it is possible to get that figure, definitely, but I will go as close as I can to it.

MR. SHELLEY: Well, not that figure so much as the number of harvesters. I know that is a tough thing to nail down because of the different factors that you have to include.

MR. FLIGHT: Just for the member's information - it is in keeping with the question that has been asked - both paper companies produce roughly 30 per cent of their requirements by the harvester technology now. So, there is still 70 per cent of the wood requirement of the paper companies being harvested by skidders - that type of operation.

MR. SHELLEY: As far as the harvesters go, there are a couple of types that I am not so familiar with but I hear of some. When they are used - I know there hasn't been an environmental impact study on the damage they do, but have there been some general observations or things through your department where they say that these harvesters actually damage the growth of especially young trees?

MR. FLIGHT: Well, the harvesters are, by and large, working in areas of prime timber. They are in prime timber stands where they are, indeed, clear cutting, as Dr. Hulan indicated a minute ago. So I wouldn't suspect that damaging young trees would be a problem unless they were going to go back in over it two years after type of thing but once they are finished, they are finished. The clear cut either grows up and regenerates naturally or we plant it. If there is any silviculture, there are no harvesters or any other kinds of equipment going in over our plantations or their plantations.

MR. SHELLEY: Well, that was the question I was about to ask you. That is good, too. I am trying to get to reality here. You know, if these harvesters are continuing, they are probably going to keep increasing. I realize that is inevitable with technology advancing and everything else, but the concern I have, and I am sure you have heard it from other people, is that if these machines are going to increase in number in the forest and if there is damage, especially to the younger trees in the areas where they are being used, eventually it is going to become a major environmental problem because they are damaging what could actually grow.

So that is why I am trying to get to this point of the environmental study. There is damage - I know there is damage; I have seen where they have worked. But I am just wondering, on a scientific level, how much damage is actually being done. As I said, although I know you have not done a study on it - because I think I asked the question; I was asking Ms. Cowan but she was not there that day to reply to it so that will lead into - and I will probably ask you again yet, too, are you going to consider in the near future, even if it is two to three years down the road, an in-depth study on that particular situation?

MR. FLIGHT: Well, number one, both paper companies follow very rigid guidelines. Although we haven't had to commit forest management plans on the Island of Newfoundland to environmental studies, we have always had an understanding with the Department of Environment that our forest management plans would mitigate the environmental damage. If Environment said, Well, we don't want you to cross this brook or you have to cross it a certain way or this is a sensitive area for a road or we are not permitting you to - once the road is laid out you can't be running all over the country after that with skidders or tractors. So there is all kinds of co-operation - there always has been co-operation between the two departments. The paper companies are constantly under pressure from the department to build their roads and access their stands in a way acceptable to the Department of Forestry which is always cognizant of the environmental damage as possible and always directing the paper companies to minimize the environmental damage.

Getting back to harvesters again, I can tell the hon. member that I am not - one could guess that there will be more harvesters but I understand, a couple of years ago, Abitibi-Price, for instance, had intended to bring in six or seven harvesters. They thought they had the economics worked out, but they decided not to do it and it was purely an economic decision. So there are some areas where it is to the company's advantage to harvest their woods with harvesters, in areas that they can't get at with skidders or with men, so they put harvesters in. We don't have any conclusive evidence that the company would be looking to do all their harvesting with mechanical harvesters.

MR. SHELLEY: I can see that would change depending on the economics of it, as you say, and if it is profitable for them to bring them in they are going to bring in more. So we really don't know - and I know you don't know. There are some there now and, of course, some men have lost work due to -

MR. FLIGHT: Yes, no doubt about it - no question about it.

MR. SHELLEY: No doubt about it. They have lost work due to these harvesters coming in. In fact, two years from now there could be another big influx of these harvesters, we don't know.

MR. FLIGHT: You see, the difficulty -

AN HON. MEMBER: They could do it by helicopter in ten years - no, seriously.

MR. FLIGHT: Not on a steep slope.

MR. SHELLEY: No, no. I've concurred with that. That is technology and it is inevitable. We have made that point. But you go ahead, you were saying -

MR. FLIGHT: The difficulty, when I or any other minister deals with Abitibi-Price or Kruger on the type of harvesting to go, is their cost, the bottom line. These companies are into major competitive markets and they have to get their wood at the lowest possible cost. Now, at the same time, there is a cost if you wipe out your environment, as well. So you have to mitigate and try to reach a happy medium.

It is a very difficult spot to be in, when the companies tell you that in order to be cost-competitive they want to use harvesters, because the cost of wood is less and therefore their newsprint remains competitive. If I, as minister, were to take the position: no, because of our concern for environmental damage or whatever, I am not permitting the paper companies to use harvesters, I mean, I wouldn't want to be the minister that the company turned to and said: We have just shut down three paper mills because our wood is not cost-effective. There has to be a happy medium here.

MR. SHELLEY: I realize that, and that is why I said to you, I am quite aware, you know, you have to consider the technology and the economics of it. The question I was going to get to - I know you can't answer that question about how many harvesters are coming in, but is there anything that your department has considered for those workers who have been displaced, or maybe will be in the future, so that they stay related to the forestry sector? Are there any programs in the future for those people?

MR. FLIGHT: Roughly two years ago when Abitibi-Price shut down number six machine - you would be familiar with that -

MR. SHELLEY: Yes.

MR. FLIGHT: - there were some two hundred and seventy jobs affected. Seventy-eight logging jobs went out of a community in my own district, Badger - seventy-eight. I'm sure the hon. member's district was affected, too.

MR. SHELLEY: We lost some.

MR. FLIGHT: No, there was no - government couldn't. We didn't have the means of providing jobs for all these people. What we have done is, up until last year, anyway, and we will decide whether or not we will have the same this year, we have had a program that we refer to under emergency response programs where, in the Central area - now the program is applicable all over the Province, but in the Central area, in particular in the Badger area and areas, we designed forestry-related programs with a view to hiring those loggers who had lost their jobs with Abitibi-Price.

When I became minister, or four or five years ago, Abitibi-Price employed in excess of 800 loggers in their Stephenville and Grand Falls operation. They are now down to just a little in excess of 400, almost 100 per cent reduction, in four or five years, and going down. I am pleased, as the member is, I am sure, that the company union signed an agreement months ago that guarantees there will be no cutbacks in the woodlands work force for at least three years. That is three years' stability. Because there was an indication - the union was aware of it, I was aware of it, and the company of course was aware - that they had plans to reduce their woodlands work force by another 120. But they have agreed with the - the union has negotiated a settlement that guarantees job security in the woods for at least the next three years.

What is happening also is that, from Abitibi's point of view or Kruger's point of view, they are saying they have to have what they call a fresh wood supply. So now it appears that instead of having 800 loggers working for four months a year, they are going to have 400 loggers working for eleven months a year. Then, with the new technology and all the rest, they will get the wood supply that they need and we are probably getting into an area where, from the two companies' point of view, they will have what they refer to as professional loggers who will work eleven months a year, and the numbers will be down greatly.

MR. SHELLEY: I am out of time, am I? I will come back.

MR. CHAIRMAN: Yes, Mr. Shelley, but we will get back to you.

MR. SHELLEY: Thank you.

MR. CHAIRMAN: Mr. Tulk.

MR. TULK: There is a point, just purely of curiosity on my part: Bt - How does it work? Because, as I understand it, there was a change made some years ago. Bt is a biological agent, whereas before, we were using - what was it?

MR. FLIGHT: Fenitrothion.

MR. TULK: Yes, what was it called?

MR. FLIGHT: A chemical.

MR. TULK: A chemical. And there was some debate ongoing in the Province as to whether Bt, as I remember it, could solve the problem. Did Bt solve the problem?

MR. FLIGHT: Yes, it solved the problem.

MR. TULK: As well as the other agent?

MR. FLIGHT: Well, there is a difference. The reason we went - and it was in 1989, by the way, that we changed. I was the minister who had the privilege of changing from fenitrothion, a chemical, to Bt.

There is an argument. The problem with Bt is that you have to be a little bit more exacting. You need two applications. It is a little more expensive. It doesn't kill the insect on contact, that kind of thing. The insect has to actually eat the -

MR. TULK: It is more environmentally friendly, though?

MR. FLIGHT: Well, it is totally environmentally friendly, and that is the reason why we are prepared to assume the higher costs and a little greater risk that it wouldn't be as effective. Anyway, past spray programs have shown, depending on efficiency, depending on the weather, on the conditions sprayed, and if we had the proper weather to do two applications, there have been cases where it has been just as effective, and cases where it may not have been as effective as if you had sprayed with fenitrothion. At the same time, I suggest to you that during the years when we were spraying with fenitrothion, there were applications and areas done where it didn't appear to be that effective either.

MR. TULK: I want to congratulate you, Minister, on taking that stance, because I think I know, from the days I spent in Opposition with you, how strongly you felt about it, and I just wondered if it had worked out the way you wanted. I suspected that it had, but I didn't know. I congratulate you on having the foresight to be an environmentally friendly minister as opposed to the other crowd when they were there. They didn't care whether they burned out your eyes or what they did. So I just want to congratulate the minister on that.

Also, I want to ask him about another -

MR. WOODFORD: Come clean.

MR. TULK: I beg your pardon?

MR. WOODFORD: Can the minister come clean now with the hon. member?

MR. TULK: He has always been an advocate of being friendly to the environment - that is his strength. The member should take a lesson from him.

The school milk program: just how successful has that been? The school milk program is another great liberal thing that the minister did, I think, since he has been there. How successful has that been?

MR. FLIGHT: It has been very effective. I understand that the industry is producing close to three million litres of milk for the school milk program.

AN HON. MEMBER: (Inaudible).

MR. FLIGHT: We are producing now about two million litres of milk, so that is added production from the industry point of view, but to me, the most important thing is that we are making milk available to school children and making sure they have that nutritional pattern.

MR. TULK: I have seen that in the last four years, myself.

MR. FLIGHT: I am sure you would have seen it. It is amazing. It has been very successful in the schools. Practically every school in Newfoundland now is taking part in the school milk program. We are putting $150,000 this year into it, as the budget shows, and I think it is probably some of the best-spent money in the whole darn Budget. I could feel good about the fact that children who might not have been able to afford milk at the regular prices can, indeed, afford it at the reduced prices being provided by the school milk program. The important thing, I think, is the value for school children themselves. Of course, the other thing is that if kids, the young people, young children start drinking milk, then you are guaranteed that they will always drink it, and when they become parents they will probably get their children to drink milk, whereas in the past, we didn't have that -

MR. TULK: It moved a lot of kids away from the soft drink can, too, a great many kids.

MR. FLIGHT: That is right, and the other side of the benefit, of course, is the increased production for our dairy industry.

MR. TULK: The minister, I think, just now made some reference to the - let me ask one more question, if I could, Mr. Chairman.

Minister, you made some references just now to the exploration of the federal/provincial forestry agreement. Did you indicate that there was some hang-up in that? It is not progressing as it should, what is the hang-up? I know it is on the minister's side.

MR. FLIGHT: The existing agreement is a five-year agreement that was signed in 1990 and expires in 1995. It has two more years to go, and there is no threat to that, but we have been told by Mr. Mazankowski in the Budget that the Federal Government don't intend to negotiate or sign any more of those agreements. If that is so, at the end of two years then we don't have the $8.5 million federal dollars to spend in our silviculture programs that we have been spending these past five years. We started doing these federal/provincial forestry agreements in 1975 and basically that is when Newfoundland got into silviculture and good forest management, because that is where the funds came from.

So, as the hon. the Member for Baie Verte -White Bay said, if we don't find a way to change their minds and have them rethink that, then, particularly in these times of restraint and economic difficulties, I don't know where the money will come from to replace that federal share, the 70 per cent. Further than that, we have an immediate problem. We had negotiated a $4.1 million extension to the existing agreement because things were identified. We needed money to do it. It had to be done on a priority basis and the Federal Government agreed with the Province that they would give us an extension, an amendment to the agreement, that would pay roughly $4.1 million that was not really funded in the original agreement. It was negotiated, ready for signing and the feds have decided they are not going - well, to this point in time they haven't signed and I am getting indications that they do not particularly want to sign. But we are working on that and we hope they will meet their commitment. They negotiated it and they agreed, so we are hoping that they will, indeed, sign the agreement; if they don't, we have immediate short-term problems in our forest management program.

MR. TULK: The Member for Baie Verte - White Bay, the other day in his speech - I understand he was (inaudible) Question Period; I was not there, I was out somewhere - but the member was comparing our forest stocks to our cod stocks and I think he made a very good point. Because I am of the firm opinion - and it is no fault of the minister - that the number of trees in this Province are fewer than we are going to need if we are to sustain the forest industry in the Province, just as a greater number of codfish out there in the water, or the turbot of the flounder, are needed to sustain the fishing industry. I think it would be a shame, quite frankly, if they - and silviculture, that is the answer. If the trees don't grow you can't cut them, and if they don't grow they aren't there. So, silviculture is the answer, and I think it is a shame that if the Federal Government don't sign the agreement - they will have to sign it soon so that people in the department can carry on their planning - that we will lose some valuable time, and the trees in this Province may, indeed, go the way of the Northern cod.

Has the minister given any thought to using the Legislature - I mean, you know we at all times use the Legislature to put pressure on the Federal Government about the state of the 2J+3KL cod stocks and the Gulf stocks. Has the minister given any thought to using the Legislature to put the same kind of pressure on? The other day we had an unanimous resolution of the House, as the Member for Humber Valley will recall, where we are pushing the Federal Government to do something about the overfishing. Silviculture is just as important.

MR. FLIGHT: Sure. As far as the existing forestry agreement is concerned, we have two years, and we only became aware of it a month ago, so everybody will use their good offices from the Premier down, I am sure, to convince the Federal Government that we can't lose those agreements, that we must have them. When the time comes, if it becomes apparent that we are not making any headway and the Federal Government persists in not going ahead with these agreements, then if I am still the minister - or whoever the minister is - we should give thought to having the House of Assembly, itself, address it.

I might point out, there is an event that will take place sometime in August, September, or October in Ottawa that may change the way the federal bureaucrats treat Newfoundland and all the programs. I am referring to a federal election in September or October. It is the stated policy of this particular federal government to dead-end those agreements. It may not be the stated policy of the ensuing government to change those agreements.

MR. TULK: Well, we are looking forward to people like the Member for Humber Valley putting pressure on the leadership candidates this coming week to do it.

MR. WOODFORD: It is a provincial responsibility.

MR. FLIGHT: There is no question that it is a provincial responsibility.

MR. TULK: Yes, but you have to put pressure on the Federal Government. Is the member trying to tell me that he doesn't believe they should fund the silviculture program?

MR. CHAIRMAN: Order, please!

The Chair will not entertain a debate between the Vice-Chair and any other member of the Committee.

MR. TULK: Mr. Chairman, I wonder if I could ask the minister one more question, or is my time up?

MR. CHAIRMAN: Your time is up, Mr. Tulk, but the Chair will recognize you again.

MR. TULK: Thank you.

MR. CHAIRMAN: Mr. Byrne.

MR. ROBERTS: No more leave.

MR. CHAIRMAN: Pardon?

MR. WOODFORD: Mr. Roberts said no more leave.

MR. CHAIRMAN: If the other members of the Committee are willing to grant leave to Mr. Tulk, the Chair will entertain that, certainly.

SOME HON. MEMBERS: By leave.

MR. TULK: Mr. Chairman, the question I have for the minister concerns the supply of birch in this Province for firewood. I believe we have to start moving away from using our spruce and, I suppose it is softwood, is it - moving away from the use of softwood for firewood and moving into the hardwoods and trees that are more or less not that valuable to us, for firewood. I find, almost every time I go out over the Trans-Canada, or wherever you drive in the Province, that you meet huge tractor-trailerloads of birch being pulled all over the Province and particularly on the Avalon Peninsula for sale in St. John's. Is the supply of birch there, and the other kinds of trees, ample to take care of that for the foreseeable future? Has the sale of birch firewood become a viable component for the forest industry in the Province?

MR. FLIGHT: I would guess, that 90 per cent of the birch you see being trucked in to St. John's is probably coming off paper company limits, Abitibi or Kruger. I would say that is a fair guess.

No, I don't think there is enough birch in Newfoundland birch stands to sustain the kind of pressure we see on it now, and we are getting more and more requests to the department to use birch for other - a lot of people are arguing that we shouldn't be burning birch, that there are many more valuable uses for it. We are getting enquiries now from people who are identifying markets in Europe, particularly for birch, and we are getting enquiries, and people doing research on manufacturing various types of furniture.

MR. TULK: I could tell the minister, outside this place, the story that I, myself, identified about white birch in this Province.

MR. FLIGHT: Sure.

MR. TULK: It turned out to be a joke, but it isn't really.

MR. FLIGHT: Okay. So, no, I think, as a matter of fact, that we are going to start getting into the same situation with birch stands as we are with softwood stands. We are encouraging people not to burn softwoods. As a matter of fact, we are not only encouraging them, we won't permit them, we won't give them cutting permits on Crown lands to harvest firewood in prime pulpwood stands or sawlog stands. We direct them to areas of low volume, insect-killed, hardwood, softwood, where it is not commercial hardwood or softwood.

What is happening now is our best commercial birch stands, particularly located on the paper company limits are, by and large, being harvested for firewood.

MR. TULK: Because they want to be rid of them.

MR. FLIGHT: Well, they don't care.

MR. CHAIRMAN: Mr. Byrne.

MR. E. BYRNE: Good evening, Minister.

My questions surround some of the recent reports from your department, the first one dealing with the Simmons report. What was the total cost of that report to your department or to the government?

MR. FLIGHT: To the hon. member, we budgeted $50,000 for the Simmons review. We are talking about the review of the zone?

MR. E. BYRNE: Yes we are.

MR. FLIGHT: We budgeted $50,000, but that did not include some of the - we allowed some of our own staff to be seconded to do things, and that was done to save money more than anything else. I would think the total cost, if you include the wage cost of people we made available from the Department of Forestry and Agriculture and the Department of Municipal and Provincial Affairs, was probably in the vicinity of $50,000 to $60,000.

MR. E. BYRNE: I know I asked questions in the House about it but this provides, I guess, a greater opportunity to deal with that report in more depth.

MR. FLIGHT: Sure.

MR. E. BYRNE: Do you, as the minister, have any plans, really, to implement any of those recommendations whatsoever? Does the government have any -

MR. FLIGHT: No question.

MR. E. BYRNE: Do you have a timetable in mind?

MR. FLIGHT: It is a process.

MR. E. BYRNE: There are groups of people - families, individuals and groups - who are certainly anxious to know what the minister's thoughts or the government's plan would be for that report.

MR. FLIGHT: One of my priorities is to implement the recommendations of the Simmons report. The hon. member will understand that there is a process you have to go through. We have the Simmons report. My department had to take the report, analyze it and look at the recommendations. There are something like forty-nine recommendations, I think. Some of them are, well, all forty-nine - one recommendation is that lands be taken out of the zone or added. I think that one recommendation covers something like forty-two or forty-three deletions, changes to the zone.

The other forty-seven recommendations regard the future administration of the zone, and various things the department should be doing relative to administering the zone. We had to analyze and study it and my officials indicated to me what they felt the implication would be if everything was implemented. We are now in the process - and that has to be a Cabinet decision, as the member will probably know. To delete land from the zone, or to add land, must be a Cabinet decision, it is not ministerial discretion. So only an MC can authorize changes to the zone.

We have been working, and the instruction from me to my staff, particularly since the election, is to prepare me to go to Cabinet to get the decisions we want. We will be implementing the recommendations that we intend to implement. I am not suggesting to the member that we will implement every recommendation that Mr. Simmons made.

MR. E. BYRNE: No, no.

MR. FLIGHT: But we will be implementing every recommendation that does not cause real concern in the department for future administration, or that kind of thing. It goes without saying that there are recommendations in the report that would be fairly costly, and obviously, again, even though it might be advisable and desirable to do what the commissioner recommended, if the funds aren't there, they aren't there, so there is no point in implementing a recommendation that is going to cost the Province a million dollars when we don't have that kind of money budgeted. So I guess those types of recommendations would be kept in abeyance and probably implemented when it made sense from a financial point of view.

I can tell the hon. member that he will probably be - if it is important to him that all the recommendations of the Simmons report be implemented - I think he will be pleasantly surprised with the number of recommendations that will, indeed, be implemented as soon as possible, given due process.

MR. E. BYRNE: As you know, Minister, representing a district where many of the recommendations contained in the Simmons report will affect, I guess, residents in the district, it certainly is important to me, and what is most important is to try to get your thoughts, as minister. I am not saying that you should implement all of the recommendations - what is important is to get your thoughts as minister. I am a member, you are the minister in charge of that department. To see when you will be implementing any or all of the recommendations is what is most important.

MR. FLIGHT: Well, I have learned through experience, and I hope the member appreciates this - early on in my career as a minister I wanted to do something, and intended to do it, and somebody asked me, `Well, when do you think this will be done?' and I said, `Well, let me see, it shouldn't take any more than three weeks.' And then I ran into the bureaucracy that I had to deal with in getting that decision through the system and up to Cabinet. So I am very leery to say - I personally don't see why -

MR. E. BYRNE: I am not trying to nail you down to next Friday or next week. I am just trying to generally get a time frame.

MR. FLIGHT: No, I understand.

AN HON. MEMBER: Sometime during your term of office.

MR. FLIGHT: No, I will be more definitive than that. I would like to do it next week, but I don't think it can be done next week because I know the various steps in the process, but just taking a wild guess, not to be pinned down, I will be disappointed if I haven't dealt with the Simmons report within a month.

MR. E. BYRNE: Okay.

My next question deals with the decisions made related to the hog industry. I am not going to debate, necessarily, the merits on why there be subsidies to the production of hog, in the hog industry, why you made those decisions, but, I guess, more or less I would like to talk about the fallout of the decisions made in the recent budget by your department and how you, as a minister, and how your department, is dealing with some of those people who are affected, particularly the hog farmers, themselves, who have been dramatically affected by those decisions.

MR. FLIGHT: You are thinking about compensation?

MR. E. BYRNE: Well, not necessarily. It could be. It could be retraining. Are there any plans? Are there negotiations ongoing with -

MR. FLIGHT: Yes, negotiations are ongoing with the farmers. As the hon. member would know, there are something like seventeen hog producers in the Province. We dealt, I think, very fairly with them when we announced that we were going to close the industry, or withdraw government support from the industry. We paid them the production subsidies that they would have earned if the hogs had been grown out nine or ten months (inaudible). We paid that up front if they chose to take it up front. We paid the cost of moving the hogs out of Newfoundland to the markets. Those were the two major concessions, I guess, to them at the time. Now, we are in the process, the industry believes -

AN HON. MEMBER: (Inaudible).

MR. FLIGHT: Yes, that's right, and we forgave the debts at Farm Loan Board, which is all we have the jurisdiction to forgive. We recognize also - and, of course, the industry made a case, and the Federation of Agriculture made a case, and members on both sides of the House made cases to me, that we had put the hog producers in a very difficult position. They owed more money than to Newfoundland Farm Products, some was with FCC, as the member would know.

We are now in the process - and I committed myself to the industry to discuss and to consider a compensation package that would have the effect of helping them exit the industry without major debts and being in a position to find another way to make a living, whether in agriculture or otherwise.

We have talked about - although there hasn't been anything definite yet, we are getting added quota, for instance, in chicken quota. it seemed natural to these people as farmers, they were into that kind of farming. It is possible, and I have said publicly that when that quota is - if there is new interest coming into the chicken producing business it would seem natural that a hog producer would be given consideration for a quota. And if one or two or three of them accepted that it would be -

Apart from hoping to put together a compensation package that will treat the hog farmers fairly, and apart from supporting the hog farmers in getting into another branch of agriculture that is possible in the Province, there is nothing more definite than that. I am prepared, obviously, as the minister, and the department is prepared, to help those hog producers access any existing programs or to take advantage of any opportunities that they want to take advantage of in agriculture in general. I think they know that.

MR. E. BYRNE: The second question deals with the task force on Agri-food that was completed some time ago. What was the total cost of that report?

MR. FLIGHT: I don't know to the exact cent but it was somewhat in excess of $800,000.

MR. E. BYRNE: What is the status of that report now?

MR. FLIGHT: Pardon me?

MR. E. BYRNE: What is the status? Is the government moving on any of the recommendations in that report?

MR. FLIGHT: Yes, we have implemented roughly 30 per cent of the recommendations. I think there were 210 recommendations. We have implemented sixty.

AN HON. MEMBER: How long have you had the report?

MR. FLIGHT: We have only had the report for a little over a year. Sixty of the recommendations have been implemented. Sixty more are ongoing - we are considering sixty more and they are not implemented to their totality, but we are moving in a way that was recommended by the task force on Agri-food.

AN HON. MEMBER: (Inaudible).

MR. FLIGHT: There are about another ninety recommendations that at this point in time we haven't dealt with, or at least we haven't implemented.

MR. E. BYRNE: Some of those -

MR. FLIGHT: Let me make clear to the hon. member, too, it was never intended - anyone who thought that the Hulan task force report was going to be done, as it was, and submitted to me, and suddenly, overnight, all the recommendations of that task force would be implemented, is not being realistic. We were looking for a report that, number one, recognized where we had been in agriculture up to now, and number two, where we should be going in agriculture in the future.

There are recommendations in that task force report, or topics dealt with, that will be a road map or a guideline for the Department of Agriculture for the next twenty years. That report was more than just saying: here are ten recommendations, implement them. It was a long-term, short-term report.

MR. E. BYRNE: I wasn't trying to pin you down, asking when are you doing this, when are doing that. It was a point of, for my information, what the cost of the report was, how far had your department moved on it, and that was it - seeking information only. I wasn't trying -

MR. FLIGHT: No, no.

MR. E. BYRNE: I know full well what a report is to a minister or to anybody else. It is a report that you have complete discretion to move on or not move on, or your department has.

MR. FLIGHT: I am probably too defensive, boy.

MR. E. BYRNE: No, I am fully aware of that and looking for information, basically. That is all I have, Mr. Chairman.

MR. CHAIRMAN: Thank you, Mr. Byrne.

It being one minute past the hour of nine, we will now take a short recess until eleven minutes past nine, that's approximately ten minutes. We will recess to the Government Caucus Room where there should be a pot of coffee on for us.

 

Recess

MR. CHAIRMAN: Order, please!

The Chair will now recognize Mr. Whelan.

MR. WHELAN: Thank you, Mr. Chairman.

Mr. Minister, I wonder if you could bring us up to date on the status of the Christmas tree industry? During the last year or so I haven't heard a great deal about it. There was a flurry of excitement there for awhile. I don't know if it has fizzled out or what.

MR. FLIGHT: We have, in the Province, twelve commercial Christmas tree operations, that is, domestic operations where the trees are grown for the purpose or silviculturally treated - private Christmas tree farms, we will call them. There is still a lot of interest and we are working with other people who want to establish Christmas tree farms. There are, as the member knows, a lot of Christmas trees coming in from Nova Scotia, from Christmas tree farms. There is a lot of activity on Crown lands. We give an operator farm a permit to come in and cut 100 Christmas trees for sale off Crown lands. We have always accommodated these operators and allowed them to cut 100 or 200 trees, whatever they requested; normally, it is around 100, 200 or 300 trees. But there is potential for more growth in the Christmas tree industry. The department has supported Christmas tree operators in the past, or people who wanted to establish farms, and we will continue to do that.

MR. TULK: Just as a point of curiosity, how long does it take, Mr. Minister?

MR. FLIGHT: It takes about ten years before you get your first crop.

MR. WHELAN: What is the estimated potential for the Christmas tree industry? Perhaps you don't have figures on it - if you do it would be great.

MR. FLIGHT: No, I don't, but I can take the question under advisement and get it for the hon. member. My deputy tells me through the ADM that there are about 30,000 Christmas trees imported into Newfoundland every year. At $10 a tree, that would be $300,000, but I understand those imported trees sell for $25 or $30.

MR. WHELAN: So it is potentially $1 million, probably.

MR. FLIGHT: I suppose if you had enough Christmas tree farms it would relieve the pressure off the forests because there is an awful lot of waste. We have changed it; we have made great strides in convincing people not to cut and waste trees. The Newfoundland psyche, or whatever, has been that if you cut down a tree you don't like, you just leave it there and go cut another and another.

MR. TULK: You have to take home two - one for the wife to turn down.

MR. FLIGHT: Yes.

So the savings to the Province by way of trees alone, by way of the forests is immense. There is evidence that if we could produce all the Christmas trees required in the Province people would not bother to go in and cut five, six or seven trees looking for that nice Christmas tree, they would go to the local farmer. Of course, there is also the potential for export. If Nova Scotia can export millions of Christmas trees into the United States, there is no reason why Newfoundland cannot, if we had the right -

MR. WHELAN: You mentioned in your opening remarks - and the reason I am asking is because I didn't pick it up - a three-year agreement totalling $1.08 million.

MR. FLIGHT: That is a training program.

AN HON. MEMBER: (Inaudible).

MR. FLIGHT: What were you thinking of?

MR. WHELAN: I am not sure. That is why I am asking.

MR. FLIGHT: A farm management agreement has also been signed, and a total of $1.08 million has been committed to this program over a three-year period.

MR. WHELAN: It is a program to train people who are already in the industry. Is that right?

MR. FLIGHT: Yes, for farm management - doing the books, so to speak, the accounting or the planning that is required for better farm operations, fiscal or otherwise.

MR. WHELAN: I just wanted to bring your attention to the area in the estimates under Limestone Sales - 3.1.05.07, the total, just below 07. There seems to be a considerable decrease in the money allotted for limestone sales.

MR. FLIGHT: What is the question?

MR. WHELAN: Under Limestone Sales there seems to be quite a decrease in the money being spent.

MR. FLIGHT: Well, that is because over the years we had an agreement with Havelock Lime to provide the Province with certain quantities of limestone. It turned out last year that we had probably in the bank, so to speak, three or four years supply of limestone that we had paid for.

AN HON. MEMBER: Just not mined.

MR. FLIGHT: It is not even mined, so we are now in a position, for the next two or three years, to draw on that limestone that we had - in effect, owned, that has been paid for, and that lime will now be provided for the next two or three years until it runs out, and the only lime expenditure budgeted here now is for bagged lime as opposed to bulk lime.

MR. WHELAN: Bagged lime - I assume that is the lime that comes in from the mainland?

MR. FLIGHT: Yes - and the transportation.

MR. WHELAN: Is there any lime bagged in the Province - local lime?

MR. FLIGHT: No, not now.

MR. WHELAN: I just wanted to mention that again, as I have had a few enquiries with regard to local lime as opposed to the bagged lime that is imported.

MR. FLIGHT: Well, the only difference -

MR. WHELAN: A number of farmers, especially the smaller farmers, are not prepared - they do not have the equipment to spread the lime, and the cyclone spreader that they have won't spread the local lime. In order to use the local lime, they would have to hire a fairly heavy tractor, and pay for spreaders from the Department of Forestry and Agriculture, at a fair expense.

I understand that this year there was some problem with the Department of Forestry and Agriculture approving purchase or the sale of bagged lime. Could you clarify that? Are you not bringing in bagged lime anymore?

MR. FLIGHT: Yes, we are bringing in bagged lime. I might tell the member that we have also just signed an agreement whereby we are providing the funds for ten development associations to buy spreaders.

I am advised those spreaders are already purchased and are being put out to the various groups, the development association, in particular; and the idea is, those spreaders will be available for the farmers that that particular development association services. So, in that case, they (inaudible).

MR. WHELAN: At a cost to the farmer?

MR. FLIGHT: It will be a nominal cost.

MR. WHELAN: Something like $100 a day?

MR. FLIGHT: $100 a day? Would it be that high?

Well, my ADM tells me, even if it were $100 a day - I can't confirm that it would be, but even if it were, you could probably lime the biggest farm in Newfoundland in three days with one of those machines.

MR. WHELAN: Okay.

MR. FLIGHT: Is that close, Dr. Hulan?

Getting back to bagged lime, we are still supplying bagged lime, are we not? So the farmer will have the option. It is more expensive, that's the problem.

MR. WHELAN: Yes. There seemed to be quite some difficulty this year in farmers getting the bagged lime. The Department of Forestry and Agriculture, the bureaucrats, I suppose, if you want to call them that - there seems to be reluctance on their part to sell bagged lime to farmers.

MR. FLIGHT: There is reluctance by my department to sell it?

MR. WHELAN: By the Department of Forestry and Agriculture, yes, that's right.

MR. FLIGHT: I would have to go to my ADM. The member indicates there is reluctance - a perceived reluctance - by our department to sell bagged lime.

MR. HOWLETT: I guess there is not a reluctance to supply bagged limestone, what it comes down to is cost. Bagged limestone is costing us about double the cost of bulk limestone in the Province; therefore, last year, these spreaders were acquired to be put out to agricultural societies and associations so that they would be able to use the bulk limestone. And using the bulk limestone also keeps the expenditures in this Province as opposed to going off to New Brunswick to bring in the bagged limestone. So it is not reluctance, if someone needs it, it will certainly be supplied. The reason we move to encourage producers to get into bulk - and we have been doing everything within our ability to provide the spreaders and the resources so that they can do that.

MR. WHELAN: Yes, I can see the fact is, we need to keep the money in the Province. But especially a smaller firm - I could understand a larger dairy farmer, or whatever, not worrying about the cost of $100 a day, but you have to understand that you have to hire a machine that can haul it, you have to pay for some sort of machine to pick up the lime spreader and bring it to your farm and return it, you know, it is quite cumbersome.

Anyway, be that as it may. The lack of centralized storage areas in the Province seem to be somewhat of a concern. As I went around my district during the election, a number of farmers, especially younger farmers, expressed an interest in possibly lobbying the government to construct some of these centralized storage areas. I ask the minister, are there any plans in the future to do that?

MR. FLIGHT: Yes, well, I can quote a paragraph out of my opening remarks that the member may have missed, and he may wish to pursue other questions on the issue; but, in my opening statement, funding has also been approved in 1993, this year's Budget under the Strategic Economic Plan, to assist producers in construction of vegetable storages, thus allowing industry to expand their marketing season. One of the problems for root crop producers who grow potatoes, turnips, cabbage, carrots, is their inability to store and having to sell. As they take them out of the ground they have had to sell them because there is no storage. So, for a very short time the market is flooded and prices are depressed as a result. Whereas, if they were in a position to hold back that production or at least sell it as they see fit, they would do a lot better, with the continuity of reasonable prices as opposed to one big splurge. So, for those reasons, we have budgeted something like $200,000 to assist with the construction of vegetable storage facilities around the Province. There are a considerable number around the Province now but we are endeavouring to increase the number of storages and the efficiency of the storages that exist.

MR. WHELAN: Okay, thank you. You mentioned something about local feed services and particularly you -

MR. CHAIRMAN: I would like to remind Mr. Whelan that his time is up; however, if he were to ask for leave and the other Committee members agree -

Will you give him leave?

MR. WHELAN: Okay, well, I have just one more question, if I may.

SOME HON. MEMBERS: Sure.

MR. CHAIRMAN: Proceed.

MR. WHELAN: With regard to local feed services, you mentioned specifically, seal meat, in your opening remarks. I was wondering: Is there any excitement with regard to this? Is the potential great?

MR. FLIGHT: We are not sure yet, because it is still in research as to how effective seal meat production will be for lambs, dairy cattle or chickens. There are studies being done and the indication is that we need to do more studies, but I can tell you that the fur farm, the fur business, the fox farming business probably survived this last year or so as a result of the seal meat program, because it turned out to be very successful - the foxes prospered on it. There are indications that the condition of a pelt was even improved by that particular diet and, of course, the big factor was the low cost for that protein to the farmers, themselves. Without that low cost, given the economy of the business - it was really down; the prices are really depressed.

There has been some upward movement this past year or so, but in the market environment it is doubtful if a lot of our fox farmers will survive without that particular program. Whether it will be successful to the same extent with chicken - in my opening remarks I indicated we are looking at the broader industry, the dairy industry and the sheep industry; the extent to which a seal meat program or an offal program will be effective, we have yet to see. Research is still going on, it is going on this day in trying to determine whether or not this is a good source of food for the other livestock industry in the Province.

MR. WHELAN: Thank you very much. Thank you, Mr. Chairman.

MR. CHAIRMAN: Mr. Woodford.

MR. WOODFORD: Minister, I think, over a year ago, a statement was made by the Newfoundland Milk Marketing Board with the request to Brookfield to stop making reconstituted milk in their plant in Lewisporte. Has anything been done on that lately? What is new? What is the status of that?

MR. FLIGHT: The status, Rick, is that - you're right - early last Fall, I think, the Milk Marketing Board requested the Agricultural Products Marketing Board to approve an order that would stop the production of reconstituted milk in the Lewisporte - Notre Dame Dairies. They wanted it effective immediately. They reconsidered that at some point and agreed that they would have it discontinued effective December 1993, of this year.

The process, as everyone knows, is that the Milk Marketing Board would go to the Agricultural Products Marketing Board for permission to gazette that order, which they did. It became a very controversial issue, as you know. Practically every town council in Newfoundland, practically every Chamber of Commerce in Newfoundland, practically every individual in Newfoundland - it was a major lobby to save, so to speak, the Notre Dame dairy plant.

There were all sorts of concerns expressed, allegations made. People had up to fifty jobs being supported by Notre Dame dairies. We did a lot of research on it. I took the position at the time, because I was coming under a lot of pressure to deal with it as the minister. And that is the problem with these darn commodity boards, they do the thing and the department has to answer for it, or justify what they - I mean, it is the minister who gets caught in the decision-making process. They look to the minister to deal with the issue even though it is the mandate of the Milk Marketing Board.

The situation right now is that the Milk Marketing Board applied to the Agricultural Products Marketing Board to gazette an order. The Agricultural Products Marketing Board have met and have dealt with the issue, and they have passed their decision to the Milk Marketing Board, and to myself as the minister. In the next little while, I have to decide whether or not - because, under the legislation, I have the right as the minister to intervene one way or the other, either to accept the recommendation of the Agricultural Products Marketing Board or not accept it. Whatever I choose to do, I have to notify the Agricultural Products Marketing Board and the Milk Marketing Board.

So, that is the status. It is being dealt with by the Agricultural Products Marketing Board. They have spent considerable time in considering the issue and have informed the Milk Marketing Board of their recommendation, and have so informed me. Now, the end of the process, of course, comes when I decide whether or not I am going to accept, without question, the recommendations of the Agricultural Products Marketing Board, or either suggest to them or direct them to issue an order.

MR. WOODFORD: Before - I believe it was changed by you since you became minister - the Board used to have the right to gazette any order. Now the APMB has that right to do the gazetting.

MR. FLIGHT: No, not the right to do the gazetting - they have the right to approve or deny the gazetting of an order.

MR. WOODFORD: Before anything is gazetted.

MR. FLIGHT: Yes.

MR. WOODFORD: Before that the ruling was reversed.

MR. FLIGHT: Yes.

MR. WOODFORD: So the APMB is in the process now of coming close to a decision with regard to the Lewisporte plant.

MR. FLIGHT: They have made their decision.

MR. WOODFORD: They have made their decision. Now it is in your hands. So the only other ruling, then, is that if you should rule, let's say, against whatever their wishes are, their only recourse then - they still have recourse through the appeal tribunal. If they ask for an appeal, you would have to set up a tribunal like you did under the - what was the one appealed?

MR. FLIGHT: If who asks for an appeal?

MR. WOODFORD: Say the Milk Marketing Board wasn't in favour of the decision, then they would have the right to ask for an appeal. Then the minister, under the Act, would have to set up a tribunal, isn't that right? the same as you did last year. What was the ruling last year on the -

MR. FLIGHT: No, I have never intervened as a minister to - I have never overruled. I have convinced them, I suppose, through negotiations with the Milk Marketing Board, to do something different from what they wanted to do, so to speak, but I have never intervened with a decision of the Agricultural Products Marketing Board.

MR. WOODFORD: No, the appeal tribunal was set up, I just forget what it was, through the Milk Marketing Board a couple of years ago and they ruled. You don't have the final say on it, the appeal tribunal has.

MR. FLIGHT: (Inaudible).

MR. WOODFORD: I just forget exactly what it was. I think it was on pricing.

MR. FLIGHT: It was on pricing.

That is a different situation from a decision by the Agricultural Products Marketing Board to order Brookfield, in this case, to discontinue the production of reconstituted milk.

MR. WOODFORD: So it is up to them to make the decision - APMB in conjunction with Newfoundland Milk Marketing Board.

MR. FLIGHT: Yes.

MR. WOODFORD: Do you expect that decision soon?

MR. FLIGHT: I would expect that decision fairly soon. I would like to be allowed to ask a question, Mr. Chairman, and get the hon. member's advice as to how I should deal with it.

MR. WOODFORD: Well, if you want my honest opinion, I think the reconstituted milk should be stopped immediately. No question. With me, there are no holds barred. It is the only place now in Canada where reconstituted milk is being processed. The danger with it is that if it is allowed to go on, there is no reason why the other plants shouldn't be allowed to do the same thing, and you know what we have. We are right back to where we were at day one in trying to get rid of reconstituted milk in the Province. That is the problem with it.

MR. TULK: (Inaudible). I have no problem with that, but -

MR. CHAIRMAN: Are you on a point of order, Mr. Tulk?

MR. TULK: No, I am just wondering if somebody - I am just sitting here as an amateur. Those two people are the experts - one is more expert than the other, but that's alright. I didn't say who it was now, Rick. You didn't see which way my finger pointed either, you never looked up. Why do you say, why is anybody saying it is a good move to close that - I am just trying to get some information here. Just educate me. There are some things I don't know, Rick, I am not like you. Why is there -

MR. CHAIRMAN: Order, please!

Are you asking for clarification on the question and answer?

MR. TULK: Yes.

MR. CHAIRMAN: To whom was your question directed?

MR. TULK: Well, whoever can answer it - the minister, obviously. I don't answer questions (inaudible).

MR. FLIGHT: Your question is -

MR. TULK: Why are we saying we have to close this plant?

MR. FLIGHT: We are not saying we have to close the plant.

MR. TULK: Well, why is somebody saying we have to close the plant?

MR. FLIGHT: Everybody is saying `close' the plant. What we are saying is, that plant does more than produce reconstituted milk. The Milk Marketing Board people are saying they want the production of reconstituted milk in that plant discontinued.

MR. TULK: What will happen then?

MR. FLIGHT: The production in that plant is 500,000 litres annually of reconstituted milk. I guess what the industry is saying is that if it were stopped, then an equal 500,000 litres of fluid milk would be produced by the fluid milk industry, by the seventy-six dairies.

MR. TULK: In other words, Mr. Minister, would it require more cows, more hay, more of all that kind of stuff? Could that plant then be used to do something with the milk that those cows produce?

MR. FLIGHT: No, because Brookfield Ice Cream - when I say no, I base it on the information that I have. Brookfield Ice Cream has the capacity in their fluid milk plants now to produce twice as much milk as they are already producing.

MR. TULK: They don't need it.

MR. FLIGHT: So, if we say, you must discontinue producing reconstituted milk and produce fluid milk in that plant, they will simply say, no, thank you, we will produce the fluid milk but it will be in our plant in St. John's, or in our plant wherever -

MR. TULK: One more question: What will be the job differential then, say, if you close Notre Dame Dairies? If you say, `Alright, there are going to be a few more cows and more hay grown in the Province,' what would be the job differential? Did anybody look at that?

MR. FLIGHT: It is hard to be definite. The people who are in support of keeping the plant open, or maintaining the production - it went as high as fifty jobs but, I mean, that is off the wall. We determined, to the extent that we could. The only total direct jobs are those in the plant in Lewisporte, about six jobs, but then the argument was that you had people - the delivery people for instance. It is hard to get a handle on exactly how many delivery people there were, because they were delivering reconstituted milk but they were also delivering ice-cream, yogurt or whatever else. The owner of the plant in Bishop's Falls that produces the jugs for the reconstituted milk, suggested that they would lose 40 per cent of their production, so he charged that off. I have been using, with some confidence, the figure of 12-15 jobs to be affected if you stopped producing reconstituted milk.

MR. TULK: I understand the farmers wanting this to stop but I am not sure it is best for the Province.

MR. FLIGHT: There are some people who will argue that -

MR. TULK: You are not a farmer.

MR. FLIGHT: - if you produce 500,000 litres of fluid milk - 500,000 is what they have reached for a dairy farm in Newfoundland.

MR. TULK: How many jobs are in that?

MR. FLIGHT: Some people are suggesting that those fifteen jobs would be created in the production of fluid milk, but if it were - there are some very highly mechanized plants in this Province that have the capability of producing more than they are producing now.

MR. TULK: Without adding any more jobs.

MR. FLIGHT: I doubt very much if they would require any more staff to produce, given the technology they have.

MR. TULK: I am just asking the minister for my own information.

MR. FLIGHT: The problem is that the Lewisporte area would be hurt badly. You might not notice in any one particular area the increase in jobs, it might be half a job on this farm or half a job on some other farm or half a job somewhere else, but whether or not you would replace all the jobs lost by the discontinuation of reconstituted milk -

MR. CHAIRMAN: I have been more than lenient in the questioning on this topic.

MR. TULK: (Inaudible), Mr. Chairman, we are talking about your district.

MR. CHAIRMAN: As you can appreciate, the Chair has an interest in both the question and the answer on this particular topic, being the member for that district. I will now go back and recognize Mr. Woodford again and allow him the extra time that was taken up by Mr. Tulk's questioning.

MR. WOODFORD: I think the minister has answered my question. We can argue the point all night but I just want to leave it with the last comment pertaining to the danger and the principle of other companies looking to make sure that they can get in on the recon market. All we are doing is mixing Newfoundland water with skim milk from the mainland and making reconstituted milk. That is all we are doing, and really, it is not a fluid product.

MR. TULK: (Inaudible).

MR. WOODFORD: Well, I mean it is immaterial -

MR. CHAIRMAN: Order, please!

I would like for the questioning to go back to Mr. Woodford, and the questioning should be directed, not at other members of the Committee, but at the minister.

MR. WOODFORD: Minister, referring to your estimates, on page 144 -Soil and Land Management, under 3.1.07, Land Development: as the Member for Kilbride mentioned, I think, one of the recommendations in the Simmons Report was that government put more money into land consolidation to try to protect agricultural lands. Has the department looked at - I notice from those estimates, there is no extra funding there. It has also, I think, been mentioned in the Strategic Economic Plan. Are there any plans now in the foreseeable future to put more monies into that particular program, and not only put monies into it but to expand it to other areas of the Province where land would be much cheaper and you would be able to consolidate a lot more agricultural land in the land banks than you would in this particular area?

MR. FLIGHT: Well, as the member would know, both issues were dealt with by the Simmons Commission, and Mr. Simmons did, indeed, recommend that more money be put into the land consolidation program. And it is good advice. It is something that we would want, as a Province, to do, but again we got caught in the fiscal reality under which we are operating, and even maintaining - if the hon. member would look through the estimates for the department, or the fourteen departments, almost every head in every department took some kind of cut in order to accomplish what we had to accomplish with regard to our budgetary problems. So, just maintaining the program at $400,000 this year was somewhat of an accomplishment, and I am proud of the fact that we could maintain the funding at last year's level - $400,000.

We haven't implemented it, as the member would know. He would know the recommendation was there, because the Simmons report was made public and everybody is aware of what Mr. Simmons said about land consolidation. However, for this year, at any rate, we are maintaining the same level of funding. Obviously, we would want, and it would be an admirable thing, to be able to increase the level of funding in that particular program, but until the financial picture in the Province improves, I don't see, in the immediate short term, that we would increase the funding in that particular vote.

With regard to land-banking or with regard to applying the land consolidation program to other parts of the Province, Mr. Simmons' recommendation in that area has been noted and has been considered by the department.

MR. WOODFORD: In your department's last budget, one of the cuts, one of the places where you are going to try to recover more funding is in the cost of the APMB which will be recovered through fees charged. What fees do you think will be charged? Will the whole agricultural industry be charged a fee, or will you deal primarily with the commodity groups?

MR. FLIGHT: We were dealing - the member will notice that we have budgeted the $97,000 required, and we balanced it off with revenue provincial. And it is a concept more than a reality. The ideal situation, of course, would be that if the commodity boards, or the commodities that the Agricultural Products Marketing Board deals with, in particular dairy, chicken, eggs - if by some levy they could help offset the cost of maintaining the Board, that would be a goal worth trying to achieve, and we are looking at the possibility. We have discussed, with the industry and with the Board, the possibility of doing that but, as the member can see, if it is not achievable, then the money is budgeted to fund the Agricultural Products Marketing Board, in any event.

MR. WOODFORD: There is a reason I say that, because the APMB really is supposed to - correct me if I am wrong - promote the interest of all sectors that are not covered by commodity groups -

MR. FLIGHT: Yes.

MR. WOODFORD: - and to protect the consumer. If that is the case, I don't see a reason why certain commodity groups in the Province should protect other sectors that are not willing to get together, and, at the same time, protect the consumer. Why can't the Consumer Affairs department look after its own?

MR. FLIGHT: I agree with some of the reasoning, but I also point out to the member that, for instance, the vegetable production people now, the people in root crops, have organized themselves, not into a marketing board to the same extent that the Milk Marketing Board, the Hog Marketing Board and the Chicken Marketing Board have, but they are organizing and forming their own association. And they will, I suspect, be looking to incorporate some of the principles that govern the other marketing boards, in which case, they will become a commodity or a sector that will look to the Agricultural Products Marketing Board for protection or advice, or for regulation. It is on that basis, anyway, that we looked at and budgeted for the possibility of raising some of the costs of the Agricultural Products Marketing Board from the commodities they serve.

MR. WOODFORD: But you haven't come, really, to any hard decision on that yet?

MR. FLIGHT: No.

MR. CHAIRMAN: Dr. Hulan.

DR. HULAN: Thank you, Mr. Chairman.

I have a few questions on agriculture. I, of course, won't let my keen interest show through too much. But I want to take a little liberty here, since things have been raised in this hon. Chamber and a recent editorial in the press makes me believe that a lot of people are making comments about the task force report who didn't read it, or if they read the report, they didn't understand or comprehend it. That is really too bad, especially when they start talking about recommendations not being implemented.

My, oh my, Mr. Minister! I was just listening to you and jotting down so many recommendations that are referenced in the task force report, such as limestone spreaders, for instance - I hear they are already purchased; the school milk program; emphasis on forage production in this Province; the issue of research on alternative feedstuffs; increasing the farm loan credit to $150,000; and I can keep on going.

Mr. Minister, you and your staff are to be commended. I hope I will have a chance to say this in a larger forum sometime and I am sure I will take that chance even if I am not allowed to. Anyhow, as far as Newfoundland Farm Products is concerned, it is the only one major recommendation that was made. There are no dollars for Newfoundland Farm Products. To build a new plant would have cost about $10 million, but a couple of years ago we lost three new plants in another agricultural venture that went down the drain, and I won't even mention which one it was.

I had a question, Mr. Minister, on limestone in the Province. I was alarmed at the reduction in the dollars. I think I understood you correctly, but if you would just quickly repeat what you said -I didn't catch all of it - in explaining this reduction in dollars for limestone.

MR. FLIGHT: Over the past four or five years, we have had an agreement with Havelock Lime to supply certain quantities of lime to Newfoundland and we paid for that lime in advance even though the lime wasn't even mined. It was a binding agreement and then officials realized, based on the amount of lime we use, we have five years of lime paid for; therefore, we told Havelock Lime the situation, that we would take delivery of that lime as opposed to purchasing any more, and that is what results in the major reduction. In other words, we will be getting lime for the next four years that has been paid for this past five years and, as a result, our cost for limestone for the next four years will be almost nil.

DR. HULAN: Had that not been the explanation, I was going to have to chastise you, but now I don't have to, of course, because it wouldn't fit very well with the recommendation that we are going to increase productivity on existing lands and so on, if we start removing our limestone.

MR. WOODFORD: The price has gone up.

DR. HULAN: The price has gone up. Yes it has, that is true.

The other area on which I am interested in getting a response is Market Development on Page 145.

As you are fully aware, Mr. Minister - and I know you are, a major problem in the Agri-food industry of this Province is in the lack of organized marketing and marketing intelligence. I assume that $42,000 is for one person, again, as was in the past. Is that right?

I have to say, that bothers me very much, because marketing is so important to a real, concerted effort on the development of the Agri-food industry of this Province. I have to make that comment.

MR. FLIGHT: I share the hon. member's concern, but again, we are caught up in fiscal restraints. If our fiscal situation were to improve for next year's budget, one of the areas to be looked at might well be an increase in funding, but that's the way it is now, and I accept and share the member's concern.

DR. HULAN: Thank you, Mr. Minister, that is all. I will save you some time at this point.

MR. CHAIRMAN: Mr. Shelley.

MR. SHELLEY: Mr. Chairman, I have just a couple of quick questions. First, I am going to refer to the Estimates, Page 135, under Forest Protection Facilities, 2.4.05.

Just for clarification or information, basically, I guess - I just noticed a big variation there. Under .07, Property, Furnishings and Equipment, it went from $25,000 to $100,000 to $540,000. I just wanted some - a point of information, really. Is that for a helicopter?

MR. FLIGHT: No. There is a company in Newfoundland called Helitactics Limited, and they have developed a fire fighting concept -

MR. WOODFORD: In Bishop's Falls?

MR. FLIGHT: It has been established in Bishop's Falls. As a matter of fact, they are into production of the first prototype now - I'm sorry, they did a prototype. It was tested. We looked at it, and we believe they have developed a technology with probably worldwide application. My officials, having seen the model demonstrated, recommended that the Department of Forestry and Agriculture purchase one of their systems for our own inventory. When the system is finished we will take delivery of it and it will be part of our fire fighting equipment, the same as a water bomber, but it is a technology that you should see, actually.

MR. SHELLEY: Can you give a brief description, or are you not at liberty to do that?

MR. FLIGHT: Yes, very quickly, it is designed as a high-pressure pump. There is a fibreglass boat - we will call it a boat, for argument sake - and the pump is placed in this boat, and the chopper just - if there is a fire somewhere in the woods, the chopper takes the kit, flies it, and drops it right into a pond. Then the hose is all spread by chopper. It is a very high-pressure pump and it takes off with three or four large size hoses, and then they are reduced by couplings to smaller hoses, but all of these hoses are spread out by a chopper, so you can cover a fire front -

AN HON. MEMBER: And then there is a remote control nozzle at the end (inaudible).

MR. FLIGHT: There is a remote control nozzle at the end that controls the direction and the pressure and the whole thing. It is an unbelievable concept. You can be fighting a fire with a mile front with one helicopter laying hoses and a guide with a remote button, as opposed to having twenty-five fire fighters along that front.

MR. SHELLEY: So that explains the $540,000.

MR. FLIGHT: Yes, last year, we paid $100,000 and this year we are paying the balance of $540,000 - the system cost in the vicinity of $650,000.

MR. SHELLEY: I have one final question. This is more a constituent-type question, I guess. During the weekend, I met with some loggers, on request, and also some truckers came in to see me. I am just asking the questions, basically, that they are asking me because, to be honest with you, I am ignorant of a lot of things as far as the truckers and scales go.

They even gave me some examples, and I have them here if you want to look at them sometime. I am sure you have heard it all, probably a lot more often than I have. There are a lot of complaints from the truckers that they are being, I guess I can use the word `harassed', at the scales. They gave me some examples. I can see why they can get pretty upset about it. I have an example here: One guy was making a trip, and from the time he started off, he would have been making $372; then, by the time he finished, with expenses and a fine, he ended up with something like $62.

MR. FLIGHT: Could I interject and tell the member he should have gone to the Minister of Works, Services and Transportation. Because I am fighting that all the time - but anyway, go ahead.

MR. SHELLEY: Well, I should, I suppose, take it up with that minister. I probably will have to end up with these questions there. The couple of things they mentioned, the ones I will try to relate to Forestry, are -

AN HON. MEMBER: (Inaudible).

MR. SHELLEY: Well, I will bring up the harassment situation. I know there is nothing to be done there because that is going to turn into a legal matter, but there are a couple of things, for example, they said that at each of these government scales they see that there isn't legal tender on the scales. Are these scales legal?

MR. FLIGHT: They are legal, obviously, for the purposes for which we are using them, weighing trucks carrying goods through the Province. I suppose they wouldn't be if you wanted to try to weigh a pound of butter on one of them, for the purpose of items for sale. This is more or less for the purpose of controlling weights on our road beds.

MR. WOODFORD: For fines, they are legal.

MR. FLIGHT: For fines, they are legal.

MR. SHELLEY: Okay. Has any consideration been given for the different weights, especially this one - you know, they go on meters now; but with green wood, as opposed to dry wood, and wintertime snow. One guy gave me an example, in which he was leaving with a truckload of wood and by the time he got through a snowstorm he was overweight. I mean, that is pretty logical, and common sense has to prevail at the end of the day. But there were actual cases where a fellow had green wood one day, no more than he had the day before, but that was drier wood, and he got nailed for it. There will have to be some consideration for that.

MR. FLIGHT: I can tell the member, I am very conversant with this problem, not because I am a minister, but because a lot of truckers in my own district make a living trucking wood. I've heard all the - you're right, and you have a great cause, a great issue, as far as I am concerned. I have, over the years, and since I have been minister, supported the concept of block loading.

MR. SHELLEY: Block loading.

MR. FLIGHT: That is being negotiated right now and I believe and hope we will come to some kind of consensus with the Department of Transportation, whose mandate is to protect the road bed. Well, my mandate is to make it possible for people working in forestry to make a living, and not be harassed, and not run the risk, as you say, of having to decide between the weight of dry wood or green wood, or leave Glenwood with a legal load, and by the time they get to Stephenville, have picked up 10,000 pounds of ice, and then have to pay for that.

We are hoping that block loading will help solve the problem, and this department is encouraging the Department of Works, Services and Transportation to introduce a system of block loading.

MR. SHELLEY: That is great news. Because these guys were really upset about it. I didn't know, and I said I would bring it to you tonight here, because they knew I was meeting on this particular one. That would solve a lot of problems, as you see it.

MR. FLIGHT: Yes.

MR. SHELLEY: So negotiations are ongoing now with the transportation department to try to come to a consensus on it.

MR. FLIGHT: In conjunction with the Department of Forestry, yes -

MR. SHELLEY: That is good news.

MR. FLIGHT: - and the companies, by the way, because they have a great interest in this, as well. As a matter of fact, the - while we are on the record, I guess - the problem with block loading, I think, is that there are concerns being introduced by the paper companies -

MR. WOODFORD: That's right.

MR. FLIGHT: - as opposed to anybody else, you know.

MR. WOODFORD: Exactly. That's where the problem is now.

MR. FLIGHT: That's where the problem is, yes.

MR. SHELLEY: Right on top of that, here is another small concern brought to me, but it could be big, I guess. Some of these trucks pull in to the scales, having a few logs over. Of course, often the attendants are a little lenient with them and ask them to throw them off. They have asked me to question what happens to them - because they go back to get them and they're gone. I mean, what happens to them?

MR. WOODFORD: They are in their garden.

MR. SHELLEY: I know what happens to them.

MR. FLIGHT: The forestry officer probably takes them out and gets them sawed for his fences. I don't know what happens to them, but it is a good question.

MR. SHELLEY: It is. I was asked, so I said I would ask it. I suppose it piles up after a while so it is not left there, is it?

MR. FLIGHT: The question, and a very legitimate question, is that, and I presume we are talking now about saw logs, what happens to the saw logs that are taken off the truck.

MR. SHELLEY: At the scales.

MR. FLIGHT: The truck is over weight, so logs are taken off the truck, or pulpwood. What happens to it?

My ADM tells me that we are not involved with it - the Department of Transportation disposes of it one way or the other.

MR. SHELLEY: I will have to get that from Transportation.

Well, thank you. That is all I have.

MR. CHAIRMAN: Mr. Whelan.

MR. WHELAN: Mr. Chairman, I understand, the average milk consumption in the Province is well below the average Canadian consumption. I also understand that an effort has been made by your department to bring up the average consumption of milk in the Province. I believe, one way you are doing it is by the method that Mr. Tulk mentioned a little while ago, subsidizing the milk for students. In the event that milk consumption in the Province is raised fairly drastically, will the additional milk quotas be allotted to existing dairy farmers or will there be an opportunity for some new entrants to get into the market? As well, if anything happens up there in Lewisporte, there will be -

MR. FLIGHT: Potential for them.

MR. WHELAN: - potential for new entrants. Will that be possible?

MR. FLIGHT: It will probably be a combination of both, depending on how big the increase in allocation was or how big the - if we suddenly started to consume twice as much milk or 25 per cent more milk than we are consuming now, therefore production would increase by 25 per cent. I would guess, the Board would decide it. The Milk Marketing Board has the mandate to allocate the quota and control production and marketing in the Province. So, under the legislation, the board would make that decision, but it would seem logical to me to believe that it might be a combination of both. Some producers have the capacity to produce more milk and may need more production in order to make their farms really economically viable. They would surely be considered for an increased quota. And I am sure that if there were room for a new operator and his application was credible and all the rest, then I am sure there would be consideration given to starting a new dairy operation.

MR. SHELLEY: Thank you, Sir. That is all, Mr. Chairman.

MR. CHAIRMAN: Mr. Woodford.

MR. WOODFORD: I don't want to get into an argument, Mr. Chairman, but (inaudible) the minister and his answer or his responses to the Member for St. George's, on the comments pertaining to some of the recommendations to be put into place, especially in forestry. Forage, limestone and bulk spreaders have been around for a long time previous to the task force report. We had an equipment bank at Pynn's Brook for years, Mr. Minister, and it was only the other day, I think, we sold off the last couple of pieces that were there last year.

Back to the limestone, Mr. Minister: that agreement was signed in 1987, for 45,000 tons, approximately 9,000 tons per year for five years. Last year it ran out - that agreement finished in 1991. What tonnage was used up to 1991?

MR. FLIGHT: Of the 45,000?

MR. WOODFORD: Of the 45,000.

MR. FLIGHT: I don't have it with me. My ADM tells me, Mr. Member, that about 21,000 to 22,000 tons have been used.

MR. WOODFORD: So, really, Havelock didn't have to provide any more lime after 1991. That lime wasn't crushed, it wasn't stockpiled, it was paid for up front and wasn't used. What tonnage was used last year, 1992?

MR. FLIGHT: Could you repeat the question?

MR. WOODFORD: What tonnage of lime was used in the sixth year - last year, 1992?

MR. FLIGHT: Approximately 6,000 tons.

MR. WOODFORD: Last year?

MR. FLIGHT: Yes.

MR. WOODFORD: Well, my figures show 3,592 tons used last year.

MR. FLIGHT: So, your calculation is approximately 4,000 tons?

MR. WOODFORD: It would exceed 6,000 tons every year, from 1987 to 1991, except for 1988.

MR. FLIGHT: Is that bulk and bagged? Are you including both?

MR. WOODFORD: I am talking about just bulk - Havelock's contract.

MR. FLIGHT: I don't know where you are getting your figures, Rick, but I can have them compared and if you are right then I will indicate -

MR. WOODFORD: My figures show that there are 1,500 tons left over from say, last year's, because your agreement shows that there is approximately a little over 5,000 tons for the four years out of the bulk - not counting the bagged, because that is a different category, it comes in from outside anyway, and it is a different price. But, if that is the case, my question is this: Why wasn't the 1,500 tons that was left over in bulk - even if the farmers around the Province were told about it, they might provide the trucking, because my understanding is that it wasn't even crushed, it isn't there, it goes back. If there were 10 tons, 1,000 tons, or 1,500 tons not used out of the allocation for each of the next four years, that means it just goes back, it stays there if it is not used.

MR. FLIGHT: I have to tell you that when I became aware of this deal, I had a problem with the deal ever having been put in place in the first place, and you are aware of who was responsible for putting the deal in place in 1987. Not only was it not crushed, it wasn't even mined. It was paid for before it was mined. We are going to be okay as a Province in the sense that Havelock understands that we paid for that lime on a contractual basis and every ton of lime we paid for will be delivered, and on that basis I can live with the concept that the deal was put in place, but I don't understand the sense of the deal in the first instance. I have asked questions about it, and my officials have explained it to me to my satisfaction as to the kind of a deal and the reasons at the time. So they understand, and I am totally aware of the way it developed, but I have some doubts about the logic of having put that deal in place in the beginning.

MR. WOODFORD: Well, apart from the logic, I mean, it served its purpose for five years. Every farmer in the Province -

MR. FLIGHT: But we were paying for ten years' lime in five years. Why did we -

MR. WOODFORD: But that wasn't the point. The agreement was signed in 1987 based on the amount of production at that time in the new Agri-food agreement and that 9,000 tons was based on the utilization of that particular amount of lime, and it wasn't utilized.

MR. FLIGHT: That's right, but we never did -

MR. WOODFORD: I mean, who would know that? It is obvious that in just one year you don't know how much was used.

MR. FLIGHT: You just indicated we only used 3,900 tons, so where the heck did the figure of 9,000 come from? Why would it be predicated at 9,000 a year, when last year we used less than 4,000 tons?

MR. WOODFORD: Less last year, but in 1988 you used 6,600 tons. I mean, that particular figure would have been dead on if farming increased in the Province. The numbers are not bad - I am not saying anything about the numbers. What I am afraid of now, and I think I am right, so you can check it out, is whatever lime is not used this year, say, for instance, there is 5,000 tons there and you only use 4,000 tons - people like this gentleman over there and every other farmer around the Province could have it, because it is paid for, anyway. All they have to do is pay for the trucking. That's my point.

MR. FLIGHT: That might be. But the indication here is that it required 9,000 tons to make the quarry viable in the first place, that Havelock wanted that size of an order, to go into the deal in the first instance, and we needed the lime, so we went into the deal on that basis. Since we were only using a little over half of the lime, then obviously, in a five-year deal they were going to produce and we were going to pay for enough lime to last us almost ten years.

It was all entered on the books and Havelock Lime is not questioning their obligation to supply us with the lime. We wouldn't treat it differently in the last year of the agreement from the way we would in the first year. In the first year, the lime was sold to the farmers and we made the deliveries and charged them for it, and we will do the same thing again.

MR. WOODFORD: Yes, but the difference is now, you're going to come out of this smiling. It is a good deal, because you're getting the next five years' lime for 1987 prices. So you are doing a good deal. But you are still not getting my point.

MR. FLIGHT: You made your last one well. I got your last point.

MR. WOODFORD: The lime left over this year, I mean, shouldn't farmers around the Province be given the right to take it? It is paid for anyway - given the right; even if they want to truck it away at their expense. Havelock will provide it, they will crush it and put it there. Right now my figures show 1,500 tons gone in 1992.

MR. FLIGHT: So, Rick, if we give them the lime this year, what do we do next year, when now the lime runs out?

MR. WOODFORD: No no, I don't mean -

AN HON. MEMBER: (Inaudible) can get it.

MR. WOODFORD: That's right. If there was an order, if they didn't crush it. That's -

AN HON. MEMBER: (Inaudible).

MR. WOODFORD: That's my problem, Minister. I know there are people around the Province who could utilize this limestone. If they could get it even for trucking - I mean, it isn't going to cost you any more, not a cent more. If there were 3,000 tons used last year, and the same for next, and the same for next, and the same for next, that means there will be 8,000 tons that Havelock will not have to crush at the end of the four years - that's my point - where it could be utilized. Because you have to pay for it at 1987 prices. It isn't costing you anything. You're pretty sneaky, too, in your department, because now you are getting another $6.50 a ton for the next three years. So it is costing you fellows absolutely nothing. That deal signed in 1987 was dead on -$31.50 per -

MR. FLIGHT: We can debate whether it was dead on, Rick, or whether it was ever necessary. In the meantime, one of the other problems also, of course, is, let's assume that you decided to give the farmers the - say, `Well, you just truck it,' kind of thing. What do we do next year? We just increased the price of lime. Even with the lime being delivered the way it is, we increase the price, Rick. So, I'm not sure that - although I would do anything I could to assist the farmer. But I'm not sure it would make sense to say: Well, this lime is here, it is available, it is paid for, you can have it now, and then, next year, have to charge them x number of dollars a ton.

MR. WOODFORD: Another point in your Strategic Economic Plan - it mentions upgrading some of the more quality pastures in the Province. If that lime were just utilized for the pastures out west, the pastures down around Bay Verte, the pastures around Cormack, it could be put to excellent use. Offer it to the pasture committees, for instance. I'm sure that they will truck it. It won't cost you a cent. It isn't costing you a cent, not a copper. It is a good point. I am not being political, I am not being facetious, I am just trying to be practical about it.

MR. FLIGHT: I will take it under advisement. The deputy has made a note on it. I will look at the advisability of it.

MR. WOODFORD: If there is 1,500 tons gone this year, we have another three years to go, and that could quite conceivably add up to 8,000 or 9,000 tons of lime that our people could be using, that is paid for - that's my point.

MR. FLIGHT: It is going to be used anyway, isn't it?

WITNESS: It won't go to waste.

MR. WOODFORD: Is my time up? Thank you, Mr. Chairman.

MR. CHAIRMAN: Mr. Tulk.

MR. TULK: Mr. Chairman, I have a question for the minister. I think it was my last question in the House as an Opposition member, to be quite frank with you. In 1989, I asked the then-premier, Mr. Peckford, for the marketing reports for the Sprung Greenhouse project. The Premier at the time replied that they were done but he refused to give them to me. May I ask the minister if he has ever come across them in his work in the department? Have they ever been found or were they, in fact, there? It is just a matter of curiosity for me, and I would suspect that some other members of the Committee might be curious about it, as well.

MR. FLIGHT: All the facts relevant to the Greenhouse were so well known by the time I became minister, or we became the government, that there was no need to ask any more questions. We never desired to embarrass anybody any more than they had already been embarrassed on that particular issue. There couldn't have been many marketing reports because there was no marketing.

MR. TULK: No, but I am asking you, as minister - you have been the minister since 1989 - have you ever come across those reports?

MR. FLIGHT: No.

MR. TULK: So we can assume they weren't there?

MR. FLIGHT: We can assume they weren't there but, in fairness, I never requested them.

MR. WOODFORD: (Inaudible).

MR. TULK: Did you ever find them when you were the minister?

MR. WOODFORD: (Inaudible).

MR. FLIGHT: In fairness, I never requested the definitive marketing reports, but then again, everyone knew there were no cucumbers marketed so it wouldn't have mattered if there were reports or not.

MR. TULK: So it was a $22 million dud from the start?

MR. FLIGHT: It was $22 million, and I understand the only benefit from it was that certain members made the acquaintance of Kenny Rogers.

MR. TULK: That's right, we got to know Kenny.

I move that we pass the Heads, Mr. Chairman. How about passing the Heads?

DR. HULAN: I have one more question, Mr. Minister. We both know that prime agricultural land is of the utmost importance and is in short supply, relatively speaking, to some of our neighbours in this country, yet, there is a lot of excellent agricultural land tied up by the large paper companies in this Province. As I sit here and look at you, I can think of three or four sections, each with probably 2,000 acres, tied up by the large paper companies. This was referenced in the task force report with regard to negotiations with these companies for the release of this prime land for agricultural purposes. Has anything been started on that, at all, Sir?

MR. FLIGHT: I don't think there have been any negotiations started with the companies for the purpose of releasing what has been identified as prime agricultural land. We are negotiating with the company all the time to have land transfers made back to the Province. In most cases, to be fair, it is to acquire or secure a wood supply for private sawmill operators.

I can tell the hon. member from experience, if there is wood on that land - it may be very fertile, arable land, but if there is wood on it, then my experience with the companies is that they will be very reluctant to negotiate a transfer back. If it is not wooded, I would be interested in identifying that land and talking to the companies about it. Now, I would have to ask the member - that land he is referring to, that he knows he can identify, would it be freehold land or would it be licensed to the Province?

DR. HULAN: I don't know. All I know is that one particular one is not wooded, it is beautiful land, it is three blocks of about 700 acres and it is controlled by Kruger at the present time.

MR. FLIGHT: In what area of the Province is that?

DR. HULAN: It is on the north side of Deer Lake with a natural slope right down to Deer Lake. It has a Southern exposure, it has everything.

MR. FLIGHT: Is it freehold?

MR. WOODFORD: It is Kruger and Crown.

DR. HULAN: Kruger and Crown, both. I went over some of it and saw test holes, Mr. Minister, dug into that property. By the way, it was cut over about twelve or fifteen years ago and was never replanted. I saw test holes dug in three feet, and you would go a long way to find a stone bigger than that - soil almost equal to what you would find in the Annapolis Valley of Nova Scotia.

I know of two individual farming entrepreneurs who have been trying to get hold of that land and have had no success. But all I am concerned about is that agricultural land in this Province is so vital and we cannot afford to allow that to happen. I will just raise it at this point, that's all.

MR. FLIGHT: Bud, that particular point you raised is a good one. I am going to see that it is pursued.

The recommendation in your report dealing with good, prime, agricultural land under the control or ownership or whatever of the paper companies is one of the recommendations that we haven't gotten to yet.

I was going to tell the Committee that all of the recommendations in your report are not equal in that sense - equal in importance. So, the ones we have implemented - we have decided to implement the better recommendations, the ones of major importance.

DR. HULAN: Well, they are all good.

MR. FLIGHT: But in the meantime, seriously, I would want that particular land identified, and I would like to hear the paper company indicate why they are not prepared to - if it is, as you say, good agricultural land, and if it is not wooded. But, by he same token, we have to be very careful to protect the forest base, as well.

DR. HULAN: But you can grow trees on scrubland.

MR. FLIGHT: Well, you can grow trees - I can plant a tree on scrubland and seventy years from now I can cut it, but there will be no paper mill around seventy years from now waiting for it to grow.

DR. HULAN: I know, but I don't think it is quite fair to compare the growing of trees with the growing of agricultural crops.

MR. FLIGHT: Well, the people who depend on the pulp and paper industry for a living might differ on that.

DR. HULAN: Well, they may disagree with me, but they also have to eat -

MR. FLIGHT: Yes.

DR. HULAN: - before they cut their trees.

AN HON. MEMBER: (Inaudible).

MR. FLIGHT: Well, Mr. Chairman, so that the hon. member and the Committee will know I am not taking that particular interjection lightly, and without the benefit, for that matter, of - I have raised the same issues with the forestry officials. It is an interesting point, a good point, and I will see that it is pursued. Because you are right - I think that if the companies are sitting on good agricultural land that is not wooded, that is not identified as their annual allowable cut or their merchantable timber supply, then they should consider or give me good reasons why it shouldn't be allowed to be farmed.

DR. HULAN: In the task force report, in fact, I think if you look into it, we recommended that even if it were necessary to exchange for every good agricultural acre, four not-so-good acres of Crown land somewhere, then we should even go as far as that in order to secure agricultural land.

Enough said, and I know you mean what you are saying, Mr. Minister, because we, in private, have talked about this but I have never put the question to you like this before.

Thank you.

MR. CHAIRMAN: Mr. Woodford.

MR. WOODFORD: I would like to make a short comment on what Mr. Hulan just said. That was done, and probably the minister - I don't know if his officials should know, that on the Goose Arm road there was a particular section of land taken in exchange, I think, about six, seven or eight years ago, and that was prime agricultural land. That same thing follows right along the Humber River. That is the problem with it all along Deer Lake, which is all good, agricultural - all soil the same as in one to seven, anywhere on the maps. That is what it shows, I think, in that area.

In the budget also, Minister, grants to livestock slaughtering facilities in the Province were cut. What kind of effect will this have on your plans to institute a meat inspection program in the Province? Because if those facilities are not looked after, or subsidized, or helped out in some way, it wouldn't be much sense to introduce a meat inspection program. Now, with the demise of some of the abattoirs in the Province, those particular facilities add a lot to smaller communities around the Island.

MR. FLIGHT: The premise of the member's question is right, in that it doesn't seem to make sense to reduce the subsidy or the grant to the livestock slaughtering facilities, and at the same time, be implementing a red meat inspection and processing or slaughtering program.

However, it was again caught up in the restraint and priorities, and practically every entity took some sort of reduction. I point out to the member also that there are other sources of funding. Money has been provided for the implementation of a red meat program, and where it is warranted, if there is a slaughterhouse identified as a slaughterhouse for the purpose of that program, then we will find the adequate funding to make the program work.

There are other sources of funding. There is ACOA, again. If a farming co-operative, development association or agricultural society wishes to upgrade or maintain or expand what is now an existing livestock slaughtering facility, there are other sources of funds that they can apply to, and if they make a strong enough case to us, then maybe we can revisit it. But, with regard to the cut, itself, it is just in keeping with the way every other entity in the department was treated.

MR. WOODFORD: What is the status now, of that meat inspection program, and how would it compare with the federal inspection program?

MR. FLIGHT: Well, our program will make it legal for red beef producers to sell in the Province. It is not for export. So, therefore, it is the Federal Government that decides - but our program will enable red meat producers to raise, slaughter, and market in the supermarkets and whatever, in the Province, red meats.

Quoting from a paragraph in Change and Challenge - An Economic Plan for Newfoundland and Labrador, `The strategy stated, a provincial meat inspection program will be established.' Well, it is being established. `Draft standards and regulation have been prepared' -the standards and regulation have been prepared and done - `and are now being forwarded to other interested departments' - the Department of Health, I would think, that type of department, `for consultation. Training is under way for three inspectors' - so we will provide three provincial inspectors - `and training has also started for regional veterinarians. Equipment purchases and laboratory renovations are almost complete and an evaluation of current facilities has been undertaken. Implementation of the program is expected this Fall.' We are hoping to have the program up and running by September.

MR. WOODFORD: By September?

MR. FLIGHT: Yes, we are targeting for September, and I might point out, by the way, that was one of the recommendations of the task force on agriculture.

MR. WOODFORD: That particular problem has been around because of the fact that Newfoundland Farm Products, seven or eight years ago, stopped all custom killing. So, this is a good thing.

MR. FLIGHT: Yes, the biggest advantage of this program will be to allow red meat producers access to the major retail outlets which they are denied now because they want to have -

MR. WOODFORD: Yes, there is no stamp, no grade, nothing, on it. I always found that the Farm Development Loan Board always had a - well, I suppose the farmers in the Province always had a problem increasing the limits to the Farm Loan Board from $75,000 up to at least $150,000 of what you are talking about now. What would be the collection rate of the Farm Loan Board?

MR. FLIGHT: It is excellent.

MR. WOODFORD: The success rate should be one of the best?

MR. FLIGHT: It is excellent, one of the best in the Province.

MR. WOODFORD: Eighty or ninety per cent?

MR. FLIGHT: The best in government of any loaning agency with government.

MR. WOODFORD: Why would you have a problem with it, and why would you have a problem convincing your colleagues to increase limits to such a successful program?

MR. FLIGHT: Oh, I don't anticipate a problem. I indicated earlier that we are in the process - the recommendation came in, it was considered, the Hulan task force recommended it, I recall the hon. member raising it before and government have never considered it. So, I am in the process now of having it considered and I am not anticipating a problem because the Farm Loan Board collection rate is probably the best in the - well, it is the best in any government lending agency.

MR. WOODFORD: Yes because that would give them a chance to compete with the other Atlantic Provinces. It is a lot easier to deal with the local than FCC. Now, FCC are starting to relax some of their programs and using their - FCC have changed some of their regulations. One is that - I guess you are familiar with them - they can just sign a promissory note for a tractor or anything like that. So, if the Farm Loan Board raised their limits it would be a real plus. While we are on this, Mr. Chairman, does anybody else want to ask questions?

MR. TULK: (Inaudible).

MR. CHAIRMAN: Are there no questions from any other member of the Committee?

MR. TULK: (Inaudible).

MR. CHAIRMAN: Shall we call the subheads?

MR. WOODFORD: I am not finished but I suppose at 10:30 p.m. we will call the subheads.

On motion, subheads 1.1.01 through 3.6.05, carried.

On motion, the estimates of the Department of Forestry and Agriculture, carried without amendment.

MR. CHAIRMAN: Mr. Minister, we will report that the estimates of your department have been carried without amendment. If you would care to make a closing remark, Sir, the Chair will entertain that at this time.

MR. FLIGHT: My closing remark would simply be, I want to thank the Committee for the courtesy and the civility which governed the whole proceedings here this evening. I appreciate that. I have tried to be as honest and forthcoming and open as I could be in dealing with questions and issues raised.

I will see to it, and the deputy minister, I think, or my officials, have taken notes of requests that I couldn't answer, and we will provide the information as soon as possible, within the next couple of days, hopefully.

I want to thank you, Mr. Chairman, and I want again to reinforce my invitation tomorrow night. From 5:00 p.m. to 7:00 p.m. we will all go out to eat. The one thing we won't permit to be discussed is the estimates of the Department of Forestry and Agriculture for those two hours.

DR. HULAN: I tell you one thing, everything that's there in meat and produce, with the exception, apparently, of the liquid, will be agri-food.

MR. FLIGHT: Thank you, Mr. Chairman. It was enjoyable. I hope the department has been able to provide some information and satisfy some of the members with regard to the concerns they expressed.

MR. CHAIRMAN: As the Chairman of this Committee, I would like to thank the minister and his officials. I would also like to say that I am quite pleased and I would like to express my thanks to the Vice-Chairman, Mr. Woodford, and to the other members of the Committee, for the manner in which the proceedings of all the meetings within this sector have been conducted.

For tonight's proceedings I would like to thank Mr. Noel, the Clerk for this evening; our recording technician, Mr. Oates; and Jeffrey, who has been our Page for this evening.

On motion, the Committee adjourned.