Pursuant to Standing Order 87, Alvin Hewlett, M.H.A. Green Bay, replaces Nick Careen, M.H.A. Placentia.

The Committee met at 7:00 p.m. in the Legislative Chamber of the Colonial Building.

MR. CHAIRMAN (Smith): Order, please!

I would like to welcome the minister and his officials here this evening. This evening we will be examining the Estimates for Industry, Trade and Technology.

I would like to begin by introducing the members of the committee first of all; my name is Gerald Smith, the Member for Port au Port and Chairman of the committee.

MR. WOODFORD: Rick Woodford, the MHA for Humber Valley.

MR. HEWLETT: Alvin Hewlett, visiting MHA for Green Bay and critic of the department.

MR. PENNEY: Melvin Penney, the MHA for Lewisporte.

MR. WILLIAM ANDERSEN III: William Andersen, the MHA for Torngat Mountains.

MR. CHAIRMAN: Now I would ask the minister if he would introduce his officials.

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

On my right is David Oake, who is the Deputy Minister of Industry, Trade and Technology; on my left is Phil Wall, who is the President and CEO of Enterprise Newfoundland and Labrador; on my far right is Dr. Doug House, who is Chairman of the Economic Recovery Commission; next to him is David Butler, who is the Financial Administrator for Industry, Trade and Technology; Patrick Kennedy next to the President, is the Vice-President of Corporate and Financial Affairs of ENL and Gordon Kane, is Executive Director who just moved to the ENL branch from the Fisheries Loan Board and Executive Director of -

MR. KENNEDY: (Inaudible).

MR. FUREY: Having said that, Mr. Chairman, any question?

MR. CHAIRMAN: You are getting on as bad as the Member for Lewisporte; he wants to call the heads already.

Just to lay down the groundwork, first of all as the procedures are set down, Mr. Minister we will offer you the opportunity to make an opening statement for fifteen minutes if you so choose or we can go directly to questions and after that, the Vice-Chairman has fifteen minutes in which to speak or raise questions and after that, ten minutes to each member on an alternating basis until everybody is satisfied that they have all the answers that they need.

Mr. Minister, over to you.

MR. FUREY: Thank you very much.

I will just make a very brief statement.

The Estimates are laid before you, the Department of Industry, Trade and Technology and all of the components that make up that department, allow for a Budget of $68.9 million, $50.2 million of it on current account, $18.7 on capital account; it is broken out this way: 86 per cent of the department's budget actually flows out to other organizations; $37.9 million to ENL and its operation; $4 million including the ACOA Enterprise network to the Economic Recovery Commission.

The interest subsidy on the Marystown Shipyard is $3.3 million; capital support for Hibernia, $4 million; commitments under the Offshore Development fund, $4.5 million; The Canada-Newfoundland Strategic Industrial Investment Agreement, $3.6 million; the Science and Technology Advisory Council, $200,000 and General Departmental Administration, $2 million which makes up roughly $59.5 million.

Mr. Chairman, of my departmental Budget that really flows for other outside Crowns and other outside initiatives, that leaves about $9.4 million in departmental programming and operations, and we are one of the few departments of government that was given an increase this year of $3.5 million for new initiatives which I outlined in response to the hon. Member for Green Bay in the House the other day, and I think I gave some of the outline of what those new initiatives are for.

They are basically to implement an information technology strategy, the on-line strategy, $500,000; high technology trade development, $50,000; investment for the first time in our film industry and audio-visual industry, $50,000; manufacturing related initiatives, $50,000; the Call Centre Swat Team as I refer to it, grossing $500,000, $250,000 equally shared under a public/private partnership. The Hibernia production phase study, that is post-Hibernia construction that is actually into production, $75,000; the establishment of some general business development initiatives such as an Ottawa procurement office, $150,000; investment prospecting activity, $400,000; a multi-year national and international industrial marketing program, $1.4 million; enhancement of departmental technical skills and trade development, $50,000; enhancement of departmental strategic planning and program evaluation capabilities, $50,000; strategic improvements to our management information system and information technology systems, $200,000; and full commissioning of the recently created project economic and financial analysis branch of our department, $250,000. That is to say, all projects that commence with various line departments will now fall through the window of ITT. We have a branch now which will analyze them and give quick results and give the benefit of our knowledge to all line departments. That makes $3.5 million.

There are a number of agreements that flow through our department as well. The SIID agreement - I guess that is about it right now, isn't it? The other ones are pretty well concluded.

WITNESS: The Offshore Development Fund (inaudible).

MR. FUREY: The Offshore Development Fund. So you can see that while we have a large budget of nearly $60 million, the great majority of it, just short of 90 per cent, actually flows out to ENL, to the Recovery Commission, to Marystown Shipyard, to Hibernia, the Offshore Development Fund, and other areas. That is why we made a case to government to give us actual new money to trigger new developments in the information technology, high technology, light manufacturing and other areas that were identified by the ERC in the growth opportunities study it did some time ago.

Those are my opening comments. If there are particular questions I would be happy to answer them. With your indulgence, Mr. Chairman, maybe we could give the Chairman of the Economic Recovery Commission three or four minutes just to talk about what he does, and maybe the President of Enterprise Newfoundland and Labrador. Then we could open the floor up if you would like.

MR. CHAIRMAN: Yes. Just a point Mr. Minister as well. I had neglected to indicate at the beginning, whenever you defer to any members of your staff I would ask that they identify themselves for the purpose of the recording so that it can be properly transcribed.

MR. FUREY: I just gave you a snapshot of ITT. With your indulgence -

MR. CHAIRMAN: Sure.

MR. FUREY: - maybe we could ask Dr. House for two or three minutes?

MR. CHAIRMAN: No problem. Within your fifteen minutes you are free to do as you please.

MR. FUREY: I'm trying to keep this within a modicum of reason. Go ahead, Dr. House.

DR. HOUSE: Thank you. I think perhaps I could bring people up to date a little bit in terms of the mandate of the ERC as kind of I guess redefined in August and the fall of 1994. First of all (inaudible) Premier and then some subsequent meetings that we had with Cabinet.

Basically our agency has four major mandates. Firstly, to advise government on social and economic policy issues. Secondly, to identify new economic opportunities, and as the minister alluded to, many of those are now incorporated into the various line departments of government which have taken over the responsibility for implementation in those new opportunity areas. Thirdly, to oversee the implementation of certain actions in the Province's Strategic Economic Plan - the most important, probably, two of those at the moment are continuing work on income supplementation reform and the implementation of getting these nineteen economic zones up and running. I will say a few more words about that in a minute. A fourth part of our mandate is kind of a public education and information mandate - we call it getting the message out - about the economic transformation process that has to occur in the Province, particularly emphasizing some of the good news stories sides of what is going on in our economy.

The major task that we have ahead of us over the next period of time will be to be the lead agency in partnership with ENL in the implementation of the report of the task force on community economic development. As you know, that calls for the establishment of nineteen economic zones in the Province with nineteen regional economic development boards. We are now in the initial stages of working with people at the community level to put that new agency in place. By the fall we hope to be entering into performance contracts between both layers of government and the different regions of the Province to outline what their specific strategies are going to be for developing each of the nineteen zones over the next five to six years. That is a major undertaking in its own right and will be probably the main focus of our work over the next period of time. In connection with that I should add, I guess, that the federal-provincial mechanism for supporting that is a thing called a strategic regional diversification agreement, and that will be the sort of mechanism that we will use in negotiating with the different regional boards to put this process in place.

Thank you.

MR. FUREY: Thank you very much, Dr. House. I will ask Phil Wall, the President of ENL, now that he has had a year under his belt, to tell us all about ENL for a few minutes. The last time he appeared here, Mr. Chairman, he was two weeks old in that job, I think.

MR. WALL: Thank you.

I have been at ENL for just a little over a year to date, and I guess it is fair to say that ENL's role in terms of economic development in the Province is to be the Province's lead, direct provider of financial assistance and advisory services to business and community development organizations in the Province.

As Dr. House mentioned, one of the challenges before the ERC as well as ENL over the next while will be to assist in the implementation of the nineteen economic zones throughout the Province. That ties in with our mandate to be the main advisory service for economic development in the Province, community economic development services.

As you are no doubt aware, another portion of our responsibility relates to providing financial assistance in the terms of loans, equity investment, venture capital loans, and advisory services to business start-ups in the Province, business expansions, and we spend quite a bit of our energy in that area. As well, we have a number of clients who come in just for, as I mentioned before, advisory services. I guess we have a motto at ENL that nobody comes into ENL and leaves without some degree of service being provided. We turn no one away, and while we have a principle of dealing with clients with respect to not providing financial assistance to clients who are in direct competition with others, we have attempted to ensure that every client, as I mentioned a minute ago, receives some degree of assistance, advice, or financial assistance from ENL such that we help them in terms of their business endeavour to improve their lot, to improve the operation, and to create more economic activity. That is about all I can say at this stage. I think everyone is familiar with our programs, and what we are trying to do.

One of the other initiatives, of course, that we have, as the minister mentioned, and we have Gordon Kane here with us, in the budget it was announced that we have responsibility at ENL now for the Fisheries Loan Board and the Farm Loan Board. All of the activities of those two former boards will come under Enterprise Newfoundland and Labrador, and major efforts are underway to ensure that is a smooth transition. I guess one of the benefits of that is those new clients of ENL will have access to all of the services of ENL, and those fishermen and farmers will have access, in fact, to a much larger pool of financing. There is going to be no segregated pool for ENL and fisheries and farming clients. They are all in the same pool and will get the same level of priority in terms of access to that, so that is about all I have to say in that regard.

MR. CHAIRMAN: Thank you, gentlemen. Before I go to Mr. Woodford, I would just like to welcome Mr. Whelan and ask him to introduce himself for the record.

MR. WHELAN: I am Don Whelan, MHA for Harbour Main.

MR. CHAIRMAN: Mr. Woodford.

MR. WOODFORD: Thank you, Mr. Chairman.

One of the things I would like to pick up on from the outset is the last comment made by Mr. Wall which pertains to the new, I suppose, transition for the Fisheries Loan Board, and the Crown Development Loan Board, from the Department of Agriculture into ENL. You say there is a pool of funding available. If you go and look at the heading 3.4.02, loan fund under capital, is that the fund you are talking about?

MR. WALL: Yes, Mr. Woodford. The amount in the pool for the coming year is $14,650,000 and that includes ENL, the fisheries program and the farming program.

MR. WOODFORD: Last year it was budgeted $14 million. My understanding is that under the revised it was still $14 million, but I do not know whether or not that was put out in loans. This year it was budgeted $14,650,000. Am I to assume you are only expecting another $650,000?

MR. WALL: There has been a reduction in the amount of funds available to ENL. I think I mentioned even at a meeting last year, that there has been, compared to previous years, a reduction in the amount of the level of demand that has come for financial assistance to ENL in the last couple of years. In discussion with Treasury Board there was a decision to reduce the amount of funding available to ENL but that was boosted up again by way of the integration with the Fisheries and Farm Loan Boards, so the three are together.

This amount, of course, refers to cash flow. At ENL we have authority to approve more than $14,650,000. Government has given us the ability to approve up to $24 million in any one year as long as we only cash flow $14,650,000. For instance coming into this year, April 1, we have approvals from the previous year which we have already approved at the board but which have not flowed yet. I believe it is in the $5 million range, but that is consistent. That has been the history. It has been $4 to $5 million most years that we have carried over from one year to the next, so in the event that $14 million turns out to be not enough we have authority from the government to go up as far as $24 million as long as we do not actually flow the funds in this fiscal year, so they can be flowed in the subsequent year.

MR. FUREY: They have always had that authority to go to $24 million, $2 million per month for twelve months. Historically they have never flowed anywhere near $24 million, so what Treasury Board has captured is their historic flow, but they still have that buffer to go up to $24 million. Even if they had $24 million to spend this year they could not flow it, and why?... because businesses have to generate other things, there are commitments, there are contingencies, some of it is premised upon getting banking and other things in place, and that takes some time for some companies.

MR. WOODFORD: Well, that was on of my concerns because if you are going to put the Fisheries Loan Board in with - I am not as familiar with the Fisheries Loan Board, then I would say that the allocations and the loans that are extended under that are going to be way down this year anyway in any case.

MR. FUREY: Under fisheries?

MR. WOODFORD: Yes, under fisheries. But in agriculture, I know last year, according to the Budget anyway, they allocated $2.5 million and revised it and put out $2.85 million, really. My concern is that there would not be a cap put on the amount of funding in ENL as it pertained to the Farm Development Loan Board, because it is a growing industry and there is room for expansion and that is the only place they can go now.

Another question you could probably answer for me is: what is the rate of return on collections for Enterprise Newfoundland on loans.

MR. FUREY: To begin, I will just answer the first part. Patrick, you will have to give us the actual percentages. I see the Fish and Farm Loan Boards as gaining by coming to ENL. Prior to that they were in a fixed pool of capital that they had access to. Now that pool has grown considerably, because the whole portfolio has been opened up to them. So I see it as a gain for farmers, farm technology, other business opportunities in farming, as I do in fishing. It is not restricted anymore to that limited pool of capital, the $2.85 million I think they had last year. The farmers now have access to that $24 million rather than the $2.8 million. That is a gain for them, that is the way I see it.

Your second question was what was the -

MR. WOODFORD: The collection rate, the repayment percentages.

MR. FUREY: Patrick, would you introduce yourself and just speak to that?

MR. WOODFORD: Maybe it is better than - ask for a delinquency rate.

MR. KENNEDY: Pat Kennedy, ENL. The collection rates on the ENL portfolio for the fiscal year 1994-1995 we budgeted in interest collection is $3.1 million, and in principal collections we had budgeted for $8.5 million in our portfolio. The total outstanding portfolio is approximately $84 million. What we actually collected against those budget numbers was $3.3 million in interest, a little more than what we had budgeted, and $8.6 million in principal. The delinquency rate on the portfolio is in the order of 33 per cent on our term loan and interest bearing notes.

MR. WOODFORD: That is something you are not going to find with the loans that are allocated to the farmers around the Province. The delinquency rate is very low -

MR. FUREY: Very low.

MR. WOODFORD: I think it is only about 10 per cent, in fact. My concern is that it doesn't get caught up - if a person who is in the agriculture business comes in for a loan, he doesn't get caught up with the same bureaucratic hassles and red tape that other people can get caught up in and be treated in the same way. Because they usually come in with a lot of collateral, except for a first-time new operator. Usually those farmers carry a fair amount of collateral and the government makes sure, whatever it is - whether it is the Farm Loan Board or Enterprise Newfoundland - that that collateral is well used by Enterprise Newfoundland or the Farm Loan Board. That was my fear when I heard this, that going over -

MR. FUREY: I can see that being a fear right off the bat, but I don't see that as being frightening. In fact, the farmers have had a terrific record of repayment. They've been diligent in their loans. That will only augur well for them, as far as I can see. Now, they can go right into the regional offices up to $150,000. Bang, done.

MR. WOODFORD: Who will be administering those loans? The same loan officers who are in the office now?

MR. FUREY: Yes.

MR. WOODFORD: Or will it come under a board?

MR. FUREY: It will come under the board that is currently there, but as you know, at ENL for loans $500,000 and below it is the corporate transaction committee. We are also having personnel from the Farm Loan Board and from the Fisheries Loan Board shift over to ENL and they will be experts at the table administering that section of the portfolio.

MR. WOODFORD: That is good. So they can go into the regional office in Corner Brook and do the same thing that anybody else in the retail, manufacturing or processing business could before.

MR. FUREY: Absolutely, and have a bigger source of capital to draw on.

MR. WOODFORD: Have a bigger source of capital.

MR. WALL: Maybe I could clarify for Mr. Woodford in the event he sends some people into ENL's office in Corner Brook. He can, but at this stage we are maintaining the status quo in terms of loans being administered by the group which currently administer or have been administering it at the Farm Development Loan Board. At this stage until we get a handle on exactly the portfolio and the processes, the approval process will be at a board committee, but supported by the group that is coming over from the Farm Development Loan Board and the Fisheries Loan Board. There is not the intent right now in the early stages to shift the responsibility for providing loans out to the regional offices, but they would certainly have access -

MR. FUREY: (Inaudible) given the structure in place now, but certainly up the road that is the intention.

MR. WALL: The access will be there. Our people are as we speak - in fact, later this week Mr. Kane and Dominic Dicks from the Farm Development Loan Board will be in Gander to meet with some of our front line staff from each region so that in the early stages we have people who are knowledgeable about the program. These people then could talk to the clients and help them to fill out applications and send them in here to expedite the process, so they won't have to get in a car and drive to St. John's to talk to someone about filling out an application. They can do that in Corner Brook with an ENL representative, or in Lewisporte with an ENL representative, or down in Grand Bank or wherever.

MR. WOODFORD: Well, most of those applications, anyway, I would say, will probably still follow the same procedure in going through the agri rep and the farm management specialist in the area before they actually go to the loan board.

MR. WALL: Yes, we have discussed it with the Department of Fisheries, Food and Agriculture and we will continue to have a process where applications for both of those programs can still come in through the department if people feel more familiar and comfortable with that. Of course, they will still have to come in to Gord Kane's group for analysis and then go to the board committee for ratification.

MR. WOODFORD: I had the understanding, and correct me if I am wrong, that the Farm Loan Board was disbanded; it was already disbanded.

MR. WALL: Both boards are disbanded, yes; they really now come under the Enterprise Newfoundland and Labrador board. I referred to them really because traditionally that is what we have had, these boards. There is no such thing as the Farm Development Loan Board now, or the Fisheries Loan Board.

MR. FUREY: There is no point in having that duplication there.

MR. WOODFORD: No, as long as there is someone there with a little bit of expertise to try to make sure that there is a continuous flow.

MR. WALL: Well, that, Mr. Woodford, is the whole purpose of what we are trying to do, to try to make sure that this process is seen as a positive process for the clients, because they are now our clients and they are just as important to ENL as any of the larger clients that we have, or smaller clients.

MR. WOODFORD: Very good.

Your lines of credit and so on, for instance for loggers in the forestry part of it, Enterprise Newfoundland and Labrador, that was an excellent program. I suspect it is still in place.

MR. WALL: Yes, the sawmill assistance program.

MR. WOODFORD: Yes, the sawmill assistance program. It used to be up to $50,000. Is it still $50,000?

AN HON. MEMBER: Yes.

MR. WOODFORD: Are there any plans to raise that $50,000 limit?

MR. WALL: Not at this time, but to be honest, I have not had any representation, either directly or from any of my offices. Now, my executive have not come to me saying that they have had representation from either individuals or from any association representing the logging industry.

MR. WOODFORD: I know there is some movement, in my particular area anyway - one in particular, a very large new sawmiller about to be established there, and he is after buying, I think, over 1.2 million board feet of log so far this year, so obviously, he must have used up his maximum with Enterprise Newfoundland, and then the rest of it is coming out of his own lines of credit with the banks and so on.

What it means, and I would like to say this here and now where the minister is, and especially yourself, because a lot of people in those offices sometimes just can't see the woods for the trees when it comes to what it means to local people. You have it in the wintertime whereby Kruger would only buy so much, Abitibi would only buy so much when it comes to pulp wood, but if you have a sawmiller in the area who will buy all winter long when the rest of the economy is down and everything is closed, they will cut and bring to him, because I know a prime example in my area, and I think you had a couple down in the bottom end of yours the same way. As I said, I know in our area, the Cormack, Reidville, Deer Lake area, this winter, there are fellows who have been going all winter selling logs, and this particular operator now is in a position where he can start up in May, hopefully the first of May, and he is going to have about 1.5 or 1.6 million board feet of logs on site ready to go, and he is going to hire twenty employees. There will be eight over and above what it was last year, plus the loggers were working all winter cutting logs, so if you didn't have that program there and so on it would have been very difficult to try to float that with the banks. Because you know what they are like. Especially if the individual has a good payment record - I'm not talking about giving it to every fly-by-night who comes in. A fellow who gets $10,000 and he doesn't pay it back, I have no time - I mean, you don't pay it, you don't get it, period. But it is an excellent program and I would say you are probably going to have some requests over the next six months to a year to raise that ceiling, especially someone who is carrying - a small businessman trying to carry that inventory, you know, especially if it doesn't move fast. If it is moved fast - (inaudible) inventory, if you could saw it - you can't saw it in the wintertime, not here, not in those places.

MR. WALL: We have had excellent results from that program. It is a good program, and we are flexible. If there is a representation from the industry then it is something that I would be prepared to take to the board to change the policy or to increase the limits.

Having said that, as well, because someone avails of the special sawmill assistance program does not preclude them from asking for special assistance from our normal - because we have the availability of working capital loans in some circumstances. If there is a special case where someone needs $100,000 in working capital funding - because that is really what it is, for some of the members. The sawmill assistance program allows loggers to buy inventory for the purpose of processing. It is usually just a one-year process where they get assistance from us to the tune of $50,000 or whatever they need, and it is always paid back the subsequent year or the Fall when they produce the logs and lumber. If any of the companies availing of this don't repay or fail to live up to their obligations under it then they are precluded from accessing it in the future. Our success rate in that program has been very good with the logging industry.

MR. WOODFORD: Good repayment record. Is my time up, Mr. Chairman?

MR. CHAIRMAN: One second. There is a red Dodge outside with the headlights on. That is yours, Alvin, is it? Okay.

Okay, Rick, one more.

MR. WOODFORD: Minister, the other day - I don't know whether it was in questioning in the House or whichever, it was - what was it on? Anyway, the privatization of Newfoundland Farm Products and Newfoundland Hardwoods will now be going through your department. Oh yes, I was questioning some of the Estimates, yesterday, of the Minister of Finance and Treasury Board. He said that there would be no need for any monies in his department this year, it is all put in your department to look after the privatization, especially of Newfoundland Hardwoods and possibly Newfoundland Farm Products. How close are you to a sale for Newfoundland Hardwoods and Newfoundland Farm Products?

MR. FUREY: Yes, the whole privatization file moved from Treasury Board to the Department of Industry, Trade and Technology. I don't think it moved because there was a better minister in Industry, Trade and Technology. I think it came as baggage with my new deputy. He was very involved and the cornerstone in negotiations of the privatization of NLCS.

With respect to Farm Products, there were some proposals. I think the one that is being examined with any modicum of seriousness is the one from the Co-operative group now. How far we are on that I don't know, I haven't been brought up to speed on it. I don't know if you have. In respect to Hardwoods, there was a general call for proposals. I think there were some twenty-one expressions of interest with six meaningful bids with deposits placed before us that are being analyzed now. That is fairly close.

MR. WOODFORD: A good chance that will go this year.

MR. FUREY: Also, I should tell you that the whole Holiday Inn package as well -

MR. WOODFORD: Is in that, yes, that is right, he mentioned that.

MR. FUREY: - in fact, the whole privatization file moved with Mr. Oake into this department. It is probably the appropriate place for it anyway, but it came with Mr. Oake being transferred from Treasury Board.

MR. CHAIRMAN: Thank you, Minister.

Mr. Woodford.

MR. FUREY: I don't know if you want to add to Farm Products. I think that is basically right, isn't it?

MR. OAKE: Yes. The Farm Products thing is a difficult privatization, as Mr. Woodford has told the minister - as he, who was the minister responsible, knows there are substantial losses at farm products. It was a difficult situation with the supply management problems and what appears to be a breakdown of supply management system in Canada; so that seems to be what's happening, and you know the competitive pressures that Newfoundland producers are under with the costs they have, and the situation at farm products and chicken prices generally are down, I mean, it is just a difficult combination of circumstances and not an easy one that you can see your way through without some sort of continued government involvement, and that's the essential problem.

AN HON. MEMBER: (Inaudible).

MR. OAKE: Hopefully, (inaudible) do that. A co-operative seems like a good model for the privatization where you only have one processor in Newfoundland, and to have the processor owned differently from the producers, it is just likely to end up in a big pile of conflict, so it seems like a good model to be following. And on Hardwoods, as the minister said, hopefully, within another month or two we are going to be in a position where we can close the transaction. At Hardwoods, we have had some very good expressions of interest from substantial companies.

MR. CHAIRMAN: Thank you, Mr. Oake.

Mr. Whelan.

MR. WHELAN: Did you have a follow-up on that, Mr. Woodford?

MR. WOODFORD: Just a short one now while we are on the topic, Newfoundland Farm Products. It would be sort of sad, in a way, because the national quota - there was an allocation supposed to be done for the Province this past year and it can't be used; that's the sad thing about it. And now, there is a problem between Quebec and Ontario pertaining to that, too, but there is a fairly large quota that should be used by the Province, used by the producers and possibly some new producers, but it can't be used, and one of the reasons for it is the possible sale of Newfoundland Farm Products in capacity.

MR. OAKE: I think the situation is that producers have picked up some of the increased quota; I think they are run in seven-week cycles - or six-week cycles instead of seven, and that is probably an unsustainable situation from the producer's standpoint over time; there is risk of disease and so on but they have been accommodating it. The limiting factor essentially now is processing capacity, and unless and until the processing situation is straightened out, it doesn't seem to make much sense for producers to take on the kind of capital investment that is needed to bring new producers on stream, until the processing situation is sorted out. And, as you know, I mean, the losses at farm products on chicken, have been mounting, they haven't been going in the right direction. There has been a general deterioration of chicken prices; anybody who goes to the supermarket can see it.

MR. WOODFORD: It is better this year.

MR. OAKE: Yes. It has just been a bad year and there is a lot of uncertainty, and until we can get past some of that, there is the combination of factors.

MR. CHAIRMAN: Thank you, Mr. Oake.

Mr. Whelan.

MR. WHELAN: Thank you, Mr. Chairman.

Mr. Minister, under heading 3.1.01, Industrial Technology and Information Industries.

I wonder if you could explain exactly what it is, that you say you have an assessment of needs and opportunities for technology development, diffusion and commercialization in the Province. I wonder if you could expound on that, and probably incorporate in your explanation of that heading, the more than doubling, almost trebling, I think, of the allotment for that particular -

MR. FUREY: Yes, I don't mind at all, and I will try to be brief because I don't want to get into -

MR. WHELAN: As long as you are thorough.

MR. FUREY: As long as I am thorough.

There are two initiatives that we implemented which gave rise to that new money flowing through that head. One is, we have taken the strategy that if we are going to try to position ourselves to attract telecentres to the Province, we know very little about it inside the bureaucracy, so what we have done is a private/public partnering. The key players in this particular instance would be Newfoundland Telephone Company - NewTel Enterprises. They know the game, they have the infrastructure, they have just laid down a fibre optic backbone right across the Province, and they have the personnel, so we are joining forces with them in a small swat team type arrangement to chase out new industries and try to attract in telecentres and telecommunications opportunities. That was one area of increase and that will be cost-shared fifty cent/fifty cents per the dollar, public/private.

The other one was the ONLINE task force. We did a substantial study which cost in the order of $250,000, whereby we brought all of the information technology companies into the mainstream. We sat down, took a look at the assets, the cluster of technologies around the Province, what was available, what kinds of things we needed, and put together a study to see how we could grow this industry into the future. One of the things that study called for, was again, a merging of the public and private partnership.

We put $500,000 on the table, $250,000 from the private sector and $250,000 from the public to put together a secretariat called ONLINE, ONLINE being the acronym for Opportunities in Newfoundland and Labrador in the New Economy. We put together an eighteen-member team, co-chaired by the Deputy Minister of Industry, Trade and Technology, and the other co-chair from the private sector is from Coopers & Lybrand, Dennis Young, who is the President of NATI, the Newfoundland Association of Technical Industries.

They have an eighteen-member board, they were given this study, and they are to come back to government with specific action items and an action plan in 180 days. It will be brought to Cabinet, resources will be put behind it, and we intend to grow the industry using that pathway or blueprint that was given to us in the form of that study for information technology.

MR. WHELAN: So basically, it is for information technology, it is not a really broad - not all types of technology.

MR. FUREY: No, it is information technology. As you probably know, information technology, as we turn the corner toward the 21st century, five years away, will be valued in the order of three trillion U.S. dollars. We don't want a whole loaf, we don't even want a slice, but if we can get a sliver, that will have quite an impact on this little economy.

MR. WHELAN: Thank you.

On 3.3.04, Hibernia GBS Site Construction - Offshore Fund. You have $1,704,700 and relatively speaking that is a fairly small chunk of money when you are talking about the Hibernia project.

MR. FUREY: Which one was it, again, Mr. Whelan?

MR. WHELAN: 3.3.04. Our GBS site construction offshore fund. What exactly is this?

MR. FUREY: You will recall in the original Hibernia agreement that site which was being built out at Bull Arm called for the Province to put in one third, or roughly 30 per cent of the actual capital cost to develop that site. The original cost was $95 million and that is the last portion which will flow out of our commitment on a net basis.

By the way, that is a $300 million facility which reverts to the Province, under the Atlantic Accord, six months after the first oil is pumped from the Hibernia site, for $1.00, all assets from paper clips right up to the manufacturing, to the fabrication yard. That is why we have put in place a team now to start marketing this in an aggressive way, to look for new opportunities, post 1997.

MR. WHELAN: Is there anything ongoing at the present time in terms of marketing?

MR. FUREY: Yes, there is. I had some meetings, as you know, in Korea with Hyundai, the Premier has met with Bellini in Italy, and I have met with Aker in Norway. These are all the big players in terms of the offshore and in terms of fabrication. There are other opportunities as well in the U.S. and other places around the world. We are going to move, though, in a very targeted way now with international expertise to market the thing in an aggressive way over the next twenty-four months, so we need skills from outside to help us.

MR. WHELAN: So, these are companies you are negotiating with to take over -

MR. FUREY: Not negotiating, but pushing a market plan at them: Is this of any use in your big corporate picture?

MR. WHELAN: Basically you are trying to sell the facility.

MR. FUREY: Sell it, lease it, use it. The bottom line is we want to try to create economic opportunity and jobs. We are not necessarily going to sell it. We may sell it if the business plan is right and people - somebody comes to us and says: We have projects for the next twenty years. We would like to have that for a fixed amount of money and we are going to employ X number of Newfoundlanders and Labradorians. If that makes sense, yes we will sell it. But this is quite an asset in quite a strategic location, so we have to be very careful who we sell it to or lease it to. But it is important that we get out and market it. That is the key, marketing it.

MR. CHAIRMAN: Thank you Minister, thank you Mr. Whelan.

Mr. Hewlett.

MR. HEWLETT: Thank you, Mr. Chairman.

I guess after listening to that, Mr. Minister, it is safe to say that the Hibernia project, although we are just talking about a small aspect of it, is somewhat more valuable than two fish plants.

MR. FUREY: Whoever said that?

MR. HEWLETT: Heaven forbid. Let me see. The new plan to develop these economic zones - I'm going out to my district on Friday. There is a meeting called by Dr. Greenwood, I think, of the Economic Recovery Commission to do a briefing for the local development association people and interested business people and so on and so forth.

One of the concerns that I had at the onset of this, just in the practical things of getting it set up, sort of reared its head yesterday I do believe, in that I had a call from someone in some ACOA office, I do believe, saying: The meeting you enquired about some weeks is going to be in Baie Verte on Thursday night. That was something that had been planned some time well in advance. The date hadn't been exactly fixed. I raised some concerns to the person I was talking to at ACOA at the time because I understand that ACOA and some provincial agents -

MR. FUREY: ERC.

MR. HEWLETT: - that are jointly doing the briefing sessions on these things -

MR. FUREY: The Economic Recovery Commission and ACOA, yes.

MR. HEWLETT: Okay. Given the reality of the zone that I'm in, basically you've got two communities of interest, one centred around Springdale, one centred around Baie Verte, there is going to be tremendous competition as to what if any place is the economic capital of that zone and so on and so forth. I expressed some objections at the time. I subsequently ventured into Springdale with a colleague of yours, Mr. Grimes, to address the Chamber of Commerce, and he readily assured the locals there who were concerned that there would be a Springdale meeting. That was organized and I'm going to that one.

But out of the blue, unbeknownst to me, the Baie Verte one was set up a day before. I got a call on it just yesterday. The development association in Springdale sort of got a call on it around the same time I did. They were a bit upset because they had put all their apples into the basket of getting everybody they could out to the Friday night meeting in Springdale. I would like a comment on this. It is almost like the left hand doesn't sort of know what the right hand is doing, assuming that we can refer to the two governments now as left and right.

MR. FUREY: It is an interesting comment. I can tell you since the release of the report there have been six formal meetings around the Province, twenty-two ad hoc meetings, and various development associations and interested stakeholders throughout the Province have called on the Economic Recovery Commission and ACOA to come out and debrief, sort of, I guess is the best way to put it.

There is generally support around the Province for it. People recognize that the status quo can't work. If you have fears in your own region I can tell you we have them in my own region. My region is zone six. It encompasses twenty-four communities going from Deer Lake North all the way to the St. Barbe ferry which crosses over into Labrador. All of these communities have their own individual personalities, their own idiosyncrasies, their own ideas and their own vision, and it is very difficult to pull them all together under one vision. But I think if we can do it on the Northern Peninsula - and it is being done very successfully, particularly in tourism, as Mr. Woodford would know; I mean, fifty-six communities came together under one solid accord and one vision to move forward tourism, and I think if people can come together and realize that by pulling together on the same rope in the same direction, we can make it work...I don't see it from the starting point of looking at it from your own narrow viewpoint. I think people have to see the bigger picture in each zone, and in that way I think we can generate opportunity.

In terms of your meetings, I have no idea. I don't know if Dr. House knows anything particularly about that particular meeting. I know that anybody who has asked for a meeting with Dr. Greenwood or anybody from the team that is involved in the debriefing has certainly been responded to. I arranged, in fact, for our own caucus to be briefed on the report, and for the Conservative caucus to be briefed on the report. I think I may even have briefed the NDP; did I, Dr. House?

AN HON. MEMBER: (Inaudible).

MR. FUREY: Yes, but I wanted to make sure that all politicians, regardless of stripe, knew what was going on, bought into the vision, and we all worked together on this. It is not something that is political, certainly.

MR. HEWLETT: Well, I guess it wouldn't be political in terms of party politics in that both the Baie Verte district and my own are of the same stripe within that particular zone, but Baie Verte is off on its own peninsula, and you do have two very distinct economic units there now that are incorporated in one zone, and there is no neutral ground, for want of a better phrase. The economic capital of the district in terms of neutral zones would have to be probably the Baie Verte Junction with the Trans-Canada Highway, out in the middle of nowhere, which is problematic.

When I dealt with the ACOA guy on setting up this particular briefing, automatically the meeting had to be in Baie Verte, I found out afterwards, because they could ski there.

MR. FUREY: You can't trust ACOA for (inaudible).

MR. HEWLETT: The problem is, you are into the very formative stages here. You are setting up an interim board which will have a long-term effect on the outcome, and it is very critical that you have a power balance to the extent that you can between the two economic entities, i.e., Green Bay and Bay Verte, otherwise this thing will get off on a very sour note.

MR. FUREY: Oh, I agree.

MR. HEWLETT: I have my concerns, because obviously, ACOA went to work and set up its own thing and let me know as a courtesy a few days in advance, but it set up its meeting literally the day before Dr. Greenwood's meeting had been set up in Springdale, which had been set up for a few weeks. But obviously the communication did not appear to be there that should have been.

MR. FUREY: Mr. Hewlett, I thought Dr. House wanted to say a few words on that, if you don't mind.

DR. HOUSE: Just a little background, I can look into the details of the specifics you are talking about - I don't know off-hand - but I should let you know that originally both Baie Verte and Green Bay were to be part of the larger central zone, and the people on the Baie Verte Peninsula kind of asked the task force if they could become a separate zone. Then we talked with people from Green Bay, people in the development association there and so on, and their feeling was that if Baie Verte was to become a separate zone, they felt their identity was closer to being with Baie Verte than with the bigger region of the central zone. So we went back to the people in Baie Verte and talked about that, and to make a long story short, they all agreed to make it a single zone of the Baie Verte plus Green Bay area, and the population figures looked good and so on. But, at the same time, I am very sensitive to the issue that you raised.

There is no principle that says there can only be one centre to be developed in a zone. In some zones there are certainly going to be more than one, and I am sure that is one of them. But I am sensitive to that feeling and there is a sense in Springdale now that most of these things seem to be happening in Baie Verte. All I can say is that we will make sure that things happen in Springdale and in Green Bay as well. If you find that this meeting doesn't go ahead, please let me know and we will make sure we arrange one in Springdale.

MR. HEWLETT: I expect the meeting will go ahead on Friday night. As a matter of fact, they did adjust the timing of the meeting in Baie Verte so interested people in Springdale could go to both if they wanted, although it is (inaudible).

MR. FUREY: The original intention was Springdale, and people from Baie Verte would come to Springdale? Was that the idea?

MR. HEWLETT: No.

MR. FUREY: Had they planned two separate meetings?

MR. HEWLETT: Springdale demanded a meeting from Roger Grimes and, I suppose, from the officials they were dealing with in the Provincial Government. ACOA seemed to have been assigned that particular zone and they went ahead and did their Baie Verte thing on their own. Like I said, the Baie Verte thing just popped up out of the blue yesterday. I just wanted to alert you to that.

MR. FUREY: Yes, okay.

MR. HEWLETT: One other point - and this is probably not fleshed out yet with regard to this whole concept: you have this economic zone, it has a board of its own. Do I understand that each zone also has a funding board of some sort? If so, what, if anything, is the relationship of ENL with regard to funding institutions or whatever that relate to that board? I gather that is not yet fully fleshed out.

MR. FUREY: I can address that, actually. In the report they actually have a recommendation. They thought it would be a smart idea to have an investment arm right in each zone, in each board. The obvious choice to do that was the so-called business development centres. Now, that is one of the recommendations that the House-Slade report came forward with, and this report came from the regions.

The Provincial Government accepted that with one caveat, and it is a very important one: That the Government of Canada commit to long-term funding for the business development centres. Then and only then would we agree to allow these to be the investment arms in each zone. Because if we didn't ask for that, it would essentially, we believed, turn into a downloading, i.e., you have nineteen bdc's sitting in nineteen zones with a drained portfolio, with no federal assistance, with the feds abandoning it, and so they would turn to the Province for their support, and we don't have the money to support that.

It has come to my attention, and I've had it confirmed at the federal level from the federal ministers involved - Mr. Axworthy, Mr. Dingwall and Mr. Tobin - that there will not be long-term sustained funding for the bdc's. Therefore, that recommendation is not acceptable to the Province. Therefore, we revert to plan B, which is, ENL will have a substantial role in each of the nineteen zones, helping them on the investment side.

MR. HEWLETT: Does that mean that individual companies or individual persons with business ideas and whatnot would go to ENL as before? It is still very fuzzy as to how an economic development idea or initiative in a given zone would somehow play through the zone and at the same time play through ENL.

MR. FUREY: Okay. You see, the investment arm would have been the bdc's and they would have been in there for small loans. I think the concept was $75,000 and less. But if they don't have the dollars to match that and give life to it, there is no point in playing smoke and mirrors here. So we simply said the bdc's will continue to operate on their own. Whatever they are doing out there, they can continue to do it, but I can tell you, there won't be long-term sustained funding, new funding, for their portfolios.

When the Economic Recovery Commission completes its work and sets up the nineteen zones over the next twelve to twenty-four months, the interface with government, when the ERC and ACOA back off, will be ENL, anyway. ENL is going to be government's day-to-day interface with the nineteen zones. That is why we said ENL must play a very critical role in the birth and organization and the development of these zones in the nineteen areas of the Province. That is why we put Mr. Wall, on the agreement of the SRDA agreement which Dr. House co-chairs. Both of them represent the Province at the table where the performance contracts will be negotiated by each zone with the Governments of Canada and Newfoundland. So, yes, ENL will be the ones who are still dealing in small loans. The thinking was, that the bdc's would step in for the $75,000 and under, but that commitment wasn't sustained in the real world of putting money behind it by Ottawa, therefore, we abandoned it.

MR. HEWLETT: Thank you.

MR. CHAIRMAN: Mr. Penney.

MR. PENNEY: Thank you, Mr. Chairman.

Mr. Minister, one of the most impressive pieces of legislation that passed through the House of Assembly in the six years that I have been there, has been the EDGE legislation, and I will say to you now, I appreciated the opportunity to have had input at your office prior to it's coming to the floor of the House as, of course, everybody in the Province did - that opportunity.

I wonder if you could give us some indication as to whether it has been as successful as we anticipated it would be - give us some idea as to what kinds of responses you have had, how many corporations have been approved to date, how many jobs you have created, just an overview.

MR. FUREY: Thank you, Mr. Penney.

I can tell you that it is very difficult to say what the success rate has been to date. Bear in mind, that while there has been a lot of talk about the EDGE legislation, much of it has been in the form of a White Paper. That White Paper was circulated through the Province, we took feedback and substantially changed the bill that we had proposed.

The legislation for EDGE is barely ninety days old - January, February, March, a little over ninety days old, so it is hard to measure what has been the impact to date. I can tell you that we have had over 1,000 calls to our 1-800 number; we have had requests for 5,000 packages which we have sent world-wide. We have had the Premier speak in the major centres of Canada and the Eastern United States, Washington, New York, Boston twice, and other areas in the U.S.

I have just completed a nine-day, working day mission in five countries and attended forty-seven separate meetings. So it is hard to gauge what will be the effect. I think we will need to be two years out looking back to see what has been the effect of this legislation. But I concur with you, I think it is a progressive piece of legislation, it is probably the most daring piece of legislation of its kind anywhere in North America, that a government has put forward in terms of surrendering its land base, its tax base and the other components of that bill.

In January, we approved two companies, Lotek Engineering, I saw their ads in the newspaper just recently; these are substantial jobs with substantial salaries. I think their intent was twenty-one jobs to start off. Canadian Iceberg Vodka Corporation ran into some difficulties in their negotiations with the St. John's Port Authority and others; their intention was National Sea, they abandoned that plan and purchased the old Carling O'Keefe brewery; they are in the process of buying a vessel, they told me just recently; they will have eleven or twelve people starting off, as they grow the demand - there will be jobs, as well, at the Newfoundland Liquor Corporation, these are already in place but these workers will be called back for additional hours. They have a $75-million marketing agreement through California and Chicago, through cable distributing, but if they can grow that demand using that marketing technique of 12,000 years in the making which is what is on the labels of their bottles; it is very clever marketing - if they can grow that, obviously, they grow jobs with it. So those two are approved.

We just approved two in February. One is a food production company; I haven't announced it publicly yet because we are still ironing out some details with their joint venture partner in Great Britain. The other is involved in the oil industry and I am a little reluctant to announce it on the advice of my very clever deputy, who tells me that it might not be prudent to do that because of the other competitors involved in the game, so we are still struggling on whether or not we should even talk about that in a public way - but it has been approved.

I can tell you, the board met this past Tuesday and considered seven applications, three of which were approved by the board and I will take to Cabinet tomorrow. There are another seven applications pending which will be considered in the next couple of weeks, seven new applications, and there are twenty companies in discussions with the government right now in a very meaningful way, but there are no applications yet from those twenty companies.

MR. PENNEY: In keeping with that, that is certainly good news, Mr. Minister, and we can use all the good news we can get, I suggest. In keeping with that, but not restricted to EDGE, we have been saying for the last two or three years - we said it here in this same room when I chaired these meetings last year, you said, and I think the year before that we said the same thing again: there are a lot of good news stories in this Province but they are not getting out. And we attributed some blame to the media, who seem to be somewhat reluctant to report good news. There is no reluctance at all to report bad news, like the incidence of HIV down in Conception Bay - the Harbour Grace area.

The media seems to be very reluctant to report on the good news stories. And I think, where you said there was enough blame to go around, and you, your department and your officials shouldered some of it yourself for not getting the news out - since you said that last year, has that changed? Are we doing a better job of getting the good news stories out, and if so, what are we doing differently?

MR. FUREY: I am not so sure it has changed. I think we are living in very cynical times, and some would argue that with good reason, people have a lot to be cynical about, politics of the past, the way some businesses have conducted themselves in the past, and a whole range of other things have given rise to an incredible cynicism.

It is very difficult to get good news out. I can tell you that Dr. House and his group deserve magnificent praise for the kinds of strategies they have developed. There are young people, in the university, for example, two I can mention from the business school, who took it upon themselves to travel the Province and talk to our high school people because it is an attitude change that we need. The media, I'll give you, are locked in a Watergate of the mind, that everything is crooked, everything is corrupt, and politicians of all stripes are all bad - and that is just not true.

We are living with the history of Watergate and Nixon, and everything else, and it all filters down, and they are all in a mood of what they call investigative journalism, but what I call a destruction in confidence, really. Because there are some fabulous stories out there, some great Newfoundland men and women who are doing remarkable things - remarkable things! They are good news, they are great stories, they are positive, and they should be held up as examples. There are literally hundreds that I could talk about tonight.

But these two young people from the business school went around to the schools and talked. I don't know how many classes they visited - Dr. House, over 100?

DR. HOUSE: There were two originally and then two more recently. It is over 100 in terms of schools and they have also been to community colleges.

MR. FUREY: These are young people talking to young people. Let me pass it over to you Dr. House and you can just tell them a little bit about what they have done and the reactions they have received, and how you are fighting to get the good news message out, too. I can sit here all day, but I would just as soon not get the credit for Chuck Furey or politicians, but I would like the media to step in, step up to the plate, and for every ten bad stories, give us two good ones, give us some semblance that there is a balance out there somewhere.

MR. HOUSE: I would settle for even just one once in a while.

MR. FUREY: Well, that is what I said to CBC in my two hours of interviews on ENL, which they castigated. I gave them 200 companies that we have helped, which were remarkable examples of companies, in Deer Lake, Corner Brook, in Green Bay, all over the Province. I gave them examples and they never used one because their intention was that the story was already done. Now, Furey, how do you fit into it?

MR. PENNEY: The problem with that, Mr. Minister, and I think you recognize that if you don't get a scattered positive story, it is very difficult to create a positive attitude.

MR. FUREY: Well, 90 per cent of recovery, I believe, is confidence, and confidence is generated for the most part on what people see, what they hear, and the kinds of things they read, and I have no control over that. But I tell you, the media are only hurting themselves. You look in our budget here this year. We have $1.4 million in there, to do what? To try to get out on the world stage and say Newfoundland is a good place: that we have some remarkable clusters of marine technologies that we've built up over the years; that we have centres of excellence that are remarkable and world-class; that we have companies which are exporting innovative technologies that have come out of the young minds of our men and women who are coming out of our institutes, 5,000 of them every year; that we did export $350 million worth of fish last year, even though the groundfishery was closed; that we are moving with great strides in the agricultural and aquacultural industries, that we are being innovative; that newsprint shipments were up, iron ore production was up; tourism grew by 6 per cent; light manufacturing grew; that nominal growth of 7 per cent happened in our economy last year, and in real terms that was 3.4 per cent. If I could wave a magic wand and bring back the fishery of the late 1960s we would probably have about 7 per cent unemployment.

These are good news stories, they are great stories, but I find that CBC just takes the numbers, takes the statistics, rents an expert, and they condemn the crap out of it. It is too bad, it is unfortunate, because we pay $1 billion a year for that. Dr. House, I'm sorry. I (inaudible) a little (inaudible).

DR. HOUSE: Filling in behind here, I guess what I would like to comment is that there is some change occurring in the media if you leave the CBC out of it.

MR. FUREY: Notice how he covered himself.

DR. HOUSE: If you look at the Express, for example, it may now have an enterprise page and this is something -

AN HON. MEMBER: Leave The Globe and Mail out of it, too?

DR. HOUSE: Well, this is something that we initiated behind the scenes and there is now a weekly good news story page, really. I don't know if you read that. Also, I think some of the other stations - VOCM and so on, are doing better.

We have recognized that we can't rely on the media to get the message out and that is why we began this getting the message out initiative. Getting to the young people in the Province is where we put the first priority. This presentation, if any of you have not seen it, I recommend you to see it. It is available. We would present to either caucus or whatever. It is very uplifting. Everyone who goes to the presentation comes away from it feeling: There is a lot more going on in our Province than we realize. We've been doing it to business groups and social service agencies as much as we can, given the fact that we are a small agency with only so many people who can do this.

On the national scene we have also the ambassador program that you may be aware of, and we have a lot of people now in other parts of the country who are getting a balanced view of what is going on in this Province directly through our ambassador program, the ambassador newsletter that comes out every month. It is a small thing. We are hoping to set up a network now in Toronto of people up there who will start meeting with each other to think of ways in which they can contribute to improving things in Newfoundland. There are a number of ways in which we are beginning to do this kind of outside of the media, recognizing the problem that we have there.

MR. FUREY: You can see, Mr. Penney, that Dr. House has a much more positive attitude than I do about the media. But, Mr. Woodford, it would be interesting for your caucus, and if you would like, Dr. House can arrange for that presentation from these two young people who have spoken to high schools and colleges around the Province. It really is an uplifting experience to hear them talk about the young men and women who are out there creating jobs - not looking for jobs, creating jobs, and creating new businesses. I was really moved by it, and I'm sure you were too, Melvin - you saw it.

MR. PENNEY: I was most impressed. As a matter of fact, I have taken the components of that presentation and I have made the same presentation back in my district on two separate occasions. The audiences were most impressed. Thank you, Mr. Chairman.

MR. FUREY: The deputy just wanted to add something to that whole issue of image and attitude and stuff.

MR. OAKE: Yes. I think one of the mandates that we have is promotion of the Province from an investment prospect and trade promotion perspective. We have been talking to government about this for a while now, and this year, as the minister said, the government has committed just about $1.5 million towards this new initiative. We've pitched it to government in the context of a multi-year initiative. We will be hiring in short order an agency of record that will manage a communications program for us. It will have several components promoting particular sectors of the Province. Also, we will be trying to do some things aimed at image enhancement, because there is no question that we have an image problem, particularly in Canada, but one of the funniest things that we encounter is if we go outside of Canada, to the U.S., to the Far East, to Europe, we don't encounter this, but this is a central Canadian perception problem to a very large degree, and it is true not only about us as a business location but also from a financial perspective.

If we go and deal in the capital markets of the United States, we get an entirely different reception, as a borrower, from what we get in Canada, and Phil Wall has been at that for twenty years. The difference in which we are received, because I guess we are part of Canada in foreign markets, they just think of us as being a part of Canada, with all that means, but our marketing and image issues are largely a phenomena of central Canadian media, and I don't know how much advertising you would have to do to get past that. But clearly, one of our tasks, at least in the business community, is to promote the image of this place as a good place to do business because, after all, we are the ones making investment decisions. There is a limit to what you can do with nice ads on Hockey Night in Canada or something. We really are trying to focus into the investors and say, you can come here and make a dollar; there is a good labour force; there are good opportunities. It doesn't have to all be soft. It has to be targeted, and that is what we are going to try to do.

MR. FUREY: Mr. Penney, Dr. House and Mr. Oake and myself gave you the short answer. Would you like the long answer?

MR. PENNEY: I think you had better run that through the Chairman. Thank you, gentlemen.

MR. CHAIRMAN: Mr. Woodford.

MR. WOODFORD: Thank you, Mr. Chairman.

Under the Change & Challenge - A Strategic Economic Plan for Newfoundland and Labrador, there was some reference made to trying to consolidate, I suppose - I have heard it in different conversations in the House with regard to trying to consolidate different government departments and places, in other words, one-stop shopping when it comes to land use, building permits, inspection services and so on. How has that progressed?

MR. FUREY: Actually, that came under Municipal and Provincial Affairs. They took the lead on it. They called it the new entity. I think they are referred to now, Mr. Woodford, as government service centres. They are proposing to set up five. They are proposing to give people quick access to permits, lands, all the kinds of services they need, and I think - are there two set up now?

AN HON. MEMBER: They are in the process of trying to rent office space and so on.

MR. WOODFORD: (Inaudible) one.

MR. FUREY: One?

MR. WOODFORD: Yes.

MR. FUREY: There is one just about ready to go in Gander. It is set up, is it?

MR. WOODFORD: Yes, Gander, and one in here; I think they are about ready to go, or they have called for tenders for some office space, anyway.

MR. FUREY: Yes, and there is one on the West Coast.

MR. WOODFORD: One in Corner Brook?

MR. FUREY: Yes.

MR. WOODFORD: But how are they going to - it makes me wonder about that, because for building permits alone, first of all you go to a council. Council has to wait for recommendations from the Department of Health in development control, and the Department of Works, Services and Transportation for everything under the sun.

MR. FUREY: It is all in this agency now.

MR. WOODFORD: So they will operate out of that agency? All those government departments that had jurisdiction over that will go through that one centre?

MR. FUREY: One stop, one permit.

AN HON. MEMBER: If I could, just by way of explanation, there have been nearly 200 people - I think it is just about 200 staff - taken out of Crown lands, municipal affairs, transportation, public health, elevator operator/boiler pressure inspectors, liquor licensing inspectors, all of those people have been taken from all over the government and put in one organization, with a mandate so that if you are a business person coming through the door you only deal there; you can get everything through that agency. It is their responsibility to look after the organization and sort things out.

I was trying to find the budget; it is on page 280. You will see all the funding set up and where it is located. It is in Municipal and Provincial Affairs. It is on the ground.

MR. FUREY: We were really lucky in Gander, Mr. Woodford; it is right next to the ENL office, too, so a businessman dealing with ENL can also get all those permits right in the same building. I don't know if that is (inaudible) -

MR. WOODFORD: I would like to see it work.

MR. FUREY: You don't think it will work?

MR. WOODFORD: I guarantee you, you are going to have to - I know you moved offices to different centres and then moved those same offices into the one centre, but getting back to what some people said before, it is changing their attitude. I guarantee you, I've dealt with them. I spent ten years on council dealing with different government departments and I spent twenty-two years in business, and I tell you, it was no easier the day I left it in 1985 than it was when I started in 1969 - no easier. The same obstacles and impediments were there. They are there today. I talk to constituents daily. They are there today. If you change it, if it is changed, I guarantee you one thing, I will be the first one on my feet. It should get the Order of Canada, nothing else.

MR. OAKE: As Mr. Woodford would know, we have been trying within government for years, to try to get some pathway through the mess, if you will. This appears to be it. But you have to remember, the other thing about this, if I can, is that it goes part and parcel with the whole deregulation initiative. If all goes according to plan, about half, at least, I would think, of government's regulations are going to be abolished. There hopefully is going to be a considerable streamlining of the hoops that one has to go through, in any event. The proof of all of this will be in the pudding, as you say, but at least the structure has been changed very dramatically from what it has traditionally been in government. It is now one organization and the people in charge of that organization have been told: Your job is to get people through this quickly.

MR. FUREY: But you are right. I tell you, it is a nightmare out there for business. There is no doubt in my mind. I saw a company come into my own riding. Just going through the environmental process they had to have fifty-one separate permits - fifty-one separate permits to spend $3 million in an attempt to spend $50 million. We lost that investment. That is too bad - that was a shame.

MR. WOODFORD: You see people in those offices, in the Department of Health, Development or whatever, they have to make sure they look after their own jobs, they have to make sure there is an extra piece of paper over there to shuffle at the end of the day and another one to pick up the next morning. I mean, they have to justify their existence, and all they need is a word or two to justify that. At the same time, some business person or individual trying to build a home or something gets hung up for days, weeks, months on end.

Anyway, I can talk about this -

MR. FUREY: You make a good point, but as Mr. Oake said, we are moving to zero-based regulation and Commissioner Noel, who is a retired justice, will have that mandate to deliver back to government in late October. And I tell you, he is as tough as nails when it comes to regulation, and I think what you are going to see are two underpinnings: sensitivity to the environment, dignity for the worker, and what regulations do we really need?

MR. WOODFORD: Yes, I - (inaudible) -

MR. OAKE: There is efficiency, if I could add as well. One of the things we have accomplished by bringing all this together is that we have been able to reduce a fair number of staff in this area. You have people whose job it was to go out and inspect sewer systems, some other guy's job was to go out and inspect an electrical system, some other guy's job was to go out and inspect an elevator. I mean, with a little bit of training and some proper scheduling the right individual can do all that stuff if you do it properly. That has been the other benefit of it. There have been some cost savings as a result of better scheduling and better utilization of people.

MR. WOODFORD: One of the biggest problems you have with it is not the fact that there is an individual going to be turned down or such. It is moving them, trying to get them off their butts to get it out. There is no excuse in the world for people to be hung up who want to do something for five, six, and seven months waiting for someone. There is nothing as bad. I always found, especially in politics, that the main thing is to get back to an individual and give him an answer. It may not be the one he wants to hear, but give him an answer. The same thing applies with Health, development control and the whole works.

Now, if they are in the one centre there is no excuse in the world. If an application comes in for Rick Woodford to put a business on a certain road, say, Frecker's Drive in Cormack, there is no excuse - it is all in one office. They can't say: I'm waiting for a report from the Department of Health now, I'm waiting for one to come in from Fisheries, Food and Agriculture, I'm waiting for one from development control - it is there.

MR. FUREY: No excuse.

MR. WOODFORD: If you walk into the office and you are a bit aggressive at all you can put them on the spot. That is one good thing about it. Hopefully, you will be able to eliminate a lot of those problems. Because it comes down not only to permits with regard to a building permit, I'm talking about business. My sonny boys, I tell you, the attitude of some of those people is just unreal.

Anyway, Mr. Chairman, as I said, it is the type of thing where you could go on forever and a day. It's rather interesting, too, because you are talking about business, you are talking about business trying to make progress, and changes and loans and stuff like that. Some people can get caught up in it and it is good. Anyway -

MR. FUREY: Mr. Woodford, how is my museum doing out there, do I own that yet?

MR. WOODFORD: Pardon me?

MR. FUREY: How is my museum doing out in Cormack?

MR. WOODFORD: Oh it is good. I will talk to you after about that. (Inaudible) an hour-and-a-half.

Mr. Chairman, I move the heads from 1.1.01 -

MR. CHAIRMAN: One second, Mr. Woodford. We do have one other person who has a question.

MR. WOODFORD: Oh, I see.

MR. CHAIRMAN: Mr. Hewlett, are you finished?

MR. HEWLETT: (Inaudible).

MR. CHAIRMAN: Okay. Mr. Andersen has a question.

MR. WILLIAM ANDERSEN III: Thank you, Mr. Chairman.

I have at least two questions regarding Industry, Trade and Technology. The first one I will ask of the minister about the Labrador Inuit Development Corporation: Minister Furey, uKautigunnagajakKama Labrador Inuit suliatsaup mitsanutkorpavasanga EDGE korparasumut ikajuttaugunnamangat?

MR. FUREY: Yes - TUK. The Labrador Inuit Corporation couldn't be involved in respect to a direct EDGE designation. That is not to say they couldn't aggressively pursue investment to come in to the area to be designated, but not as a stand-alone. Did I get that right, TUK?

MR. WILLIAM ANDERSEN III: Yes. Taimaimmat uKautigunnaKama Tungait ujaganniavingita katiKatigenninga EDGE-kut ikajuttaugunnamangata?

MR. FUREY: In respect to EDGE?

MR. WILLIAM ANDERSEN III: Yes.

MR. FUREY: Yes, they could do that. I can't verbalize your language but I hear what you are saying. They could do it on a stand-alone basis as a company coming in from outside to get designation, and LIDC could do that. TUK.

MR. WILLIAM ANDERSEN III: Naku - well done, Minister.

MR. FUREY: Thank you.

MR. WILLIAM ANDERSEN III: The other part of the question I have is with respect to technology. I was speaking with a constituent yesterday who is setting up an Internet account for the Labrador Inuit Association.

MR. FUREY: Internet?

MR. WILLIAM ANDERSEN III: Yes. I was made to understand that technology today has moved from the dial tone to digital and now is looking into possibly getting into fibre optics, which would be a much more advanced communications technology. I was told that this person was talking to someone at Memorial University, and Memorial University is indicating that because the population in Labrador doesn't justify it, they will never move out of the dial tone technology, which would leave Labrador way behind with respect to technological development.

I don't know if Industry, Trade and Technology has any bearing on that kind of development.

MR. FUREY: That is a difficult question, Mr. Andersen, for me to answer tonight. That is something that I will have to take up with both Memorial and Newfoundland Telephone, but I will agree to do that for you and to pursue it for you.

MR. WILLIAM ANDERSEN III: Okay, thank you.

MR. CHAIRMAN: Thank you, Mr. Andersen.

Mr. Woodford.

MR. WOODFORD: Mr. Chairman, I move the heads from 1.1.01 through to 4.2.04, which includes the minister's salary - as if he needs it.

MR. FUREY: Do you catch those vicious attacks coming at me from the Vice-Chair!

Mr. Chairman, I brought along our latest promotion packages which we use around the world, for any members who might be interested in picking one up.

On motion, subheads 1.1.01 through to 4.2.04, carried.

On motion, Department of Industry, Trade and Technology, total heads, without amendment, carried.

MR. CHAIRMAN: Thank you very much.

Minister, to you and your officials, thank you very much for your co-operation, also to the members of the Committee and the staff who assisted us tonight, Elizabeth Murphy from the Clerk's Office, Elizabeth Russell, the Page, and Colin Chapman looking after the recording. I will now entertain a motion to adjourn.

On motion, Committee adjourned.