The Committee met at 7:00 p.m. in the House of Assembly.

CHAIR (Canning): Order, please!

Welcome to the Resource Estimates Committee meeting for the Department of Forest Resources and Agrifoods.

First of all, though, I think the Committee members have the minutes circulated. Before we deal with the minutes, perhaps starting with Mr. Osborne we might want to introduce ourselves to our guests.

MR. T. OSBORNE: Tom Osborne, MHA for St. John's South.

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

MR. SHELLEY: Paul Shelley, MHA for Baie Verte.

MR. BARRETT: Percy Barrett, MHA for Bellevue.

MR. FITZGERALD: Roger Fitzgerald, MHA for Bonavista South.

MS THISTLE: Anna Thistle, MHA for Grand Falls-Buchans.

CHAIR: My name is Perry Canning, I'm the MHA for Labrador West.

First of all, I would like for the Committee to take a look at the minutes, and we will get that little bit of business out of the way now.

On motion, minutes adopted as circulated.

CHAIR: Minister, good evening, and welcome to the Committee. I would like for you to take a couple of moments perhaps and have your staff introduce themselves to the Committee.

MR. K. AYLWARD: Thank you, Mr. Chairman. It is nice to be here, a pleasure. I look forward to my exam that I will have in a short period.

Mr. Harold Stanley is our Deputy Minister for Forest Resources and Agrifoods. We also have Dr. Mohammed Nazir, Assistant Deputy Minister for forestry and wildlife and inland fisheries. Also we have Mr. Martin Howlett, who is the Assistant Deputy Minister for agrifoods. We have Margaret Power who is our Director of Human Resources, Leonard Clarke who is our Director of Financial Services, and David Wells who is our Director of Communications. That is our staff here this evening.

CHAIR: If you would like, you can take a few moments perhaps, if you would like to make an opening statement to the Committee with respect to the progress of your department throughout the year, and what you expect to be able to accomplish in the year coming. I would suggest too that if your officials at any time react to questions to identify yourselves for the purposes of Hansard. I think they are well enough used to our voices that they probably know who we are as we speak. Minister, it is all yours.

MR. K. AYLWARD: Thank you, Mr. Chairman. It is a pleasure to be here. I just want to give in a few minutes just a quick overview of the department and then I will hand it back to your, sir.

This department is responsible for managing the resources of forestry, wildlife and agriculture. It also has a limited role in inland fisheries and is responsible for bio-diversity conservation. These resources contribute over $1.1 billion to the economy of Newfoundland and Labrador with a value of shipments of over $600 million for the pulp and paper industry and the sawmilling industry, a $200 million contribution from wildlife and the inland fishery sector, and a $300 million income generated by the agriculture and agrifood sector. In addition, these resources contribute to many non-consumptive and intrinsic existence values which our society values highly, and which is much enriched by the presence of these resources and their influence on our outdoors.

The pulp and paper industry and sawmill industry reached new peaks in the history of Newfoundland and Labrador this past year with 741,000 tons of newsprint produced and exported to forty-five countries, including North America. Over 85 million FBM of lumber was produced in this Province and that was also a record for the Province. We are exporting these products also to the U.S.A., Europe, South America, the Middle East and Asia. About 30,000 people apply for domestic woodcutting permits in the Province, so that tells you that there is a lot of interest in the Province and a lot of use of the resource.

Our wildlife populations of moose and caribou are at or near peak. There are 110,000 qualified hunters registered in this Province, which is about 50 per cent of the adult population really. Approximately one-third of this number get big game licenses every year. An additional 120-odd outfitters depend on big game on the Island and in Labrador, generating over $30 million worth of income. It is also estimated that about 300,000 Newfoundlanders participate in trout angling, and 20,000 to 25,000 salmon licenses are pretty well issued every year. Residents of this Province have the highest participation rate in fishing and hunting as compared to the rest of North America.

Our department, when it comes to forestry, has moved towards a policy of value-added. Our wood supply is limited, on the Island in particular, so we are harvesting approximately 2 million cubic feet per year. We end up with trying to make sure that we value-add that wood supply. In the last five years, in particular the last two or three years, our sawmilling industry has grown because of a lot of cooperation, and also because of the policy of the department in promoting to the pulp and paper companies the exchange of our bigger wood to the sawmills and helping these sawmills grow. As is evident, we have a number of new sawmills being looked at, integrated sawmills, and a lot of job creation which is now going from what used to be more seasonal and is now becoming longer term.

There is a transition in our forestry industry which is becoming more secure and more stable, and we are taking better care of managing the forest when it comes to our management of it. Our plans for harvesting and our forestry management plans are all very carefully put together. Our people meet with local interests to look at how we plan to deal with our forest in each region, as required under the legislation, and it is working out quite well.

It is a department where it has a heavy impact on the economy in rural areas. In silviculture work in the past year we are involved in eighty communities between the industry and the government when it comes to investments in silviculture work. These projects were very helpful for rural Newfoundland employment and also very helpful for reinvestment purposes to stabilize and help grow our forest. It has been a big investment in the past number of years and we look forward to seeing that continue in the future.

When it comes to agrifoods, we are going to have in the next month or so an advertising awareness campaign which will be an emphasis on produced right here in Newfoundland and Labrador. Our agrifoods sector is a sector that is doing pretty well. We are looking at some new initiatives. The milk marketing board, for example, just released a statement yesterday where we had very good production and very good consumption, even though our population base was a little bit less. That is an industry that has been doing well.

We have had a number of other areas where we see some developments occurring in some smaller commodity sectors. Our agrifood sector is one very rural Newfoundland and Labrador based, and it is one we are working with the farmers very much on an ongoing basis. The Federation of Agriculture is very involved. We have had them involved in developing this awareness campaign, and we hope it will help pay off in the sense of procurement and purchasing of Newfoundland products.

On the wildlife side, things are very interesting there also. Our wildlife resources I believe are being managed as good as or better than anywhere else in North America when it comes to our big game, and our small game is now being concentrated on. We just recently hired a new biologist who is going to concentrate on small game. A lot of good work is being done there, a lot of research work to insure that we have sustainable resources for the future. On the wildlife side we have been involved with setting up the Wildlife and Inland Fish Advisory Council. That has been set up in the past year. That has been working quite well and has been giving advice to our department. It is made up of fifteen stakeholder groups from around the Province that represent different interests, and that has been working quite well.

There are a few issues out there that we are dealing with. Overall, this department is carrying out its mandate and its resources are being expended, I think, in a positive manner. We are hoping to see some new initiatives very shortly in the sawmill and agrifood sectors to be realized.

The other thing I want to highlight is that Uncle Sam in Goose Bay is doing really well. His product line is doing very well, I believe, Doctor. We are going to have some samples of Uncle Sam's product line for you very shortly, as a matter of fact. He has created I think probably fifteen jobs now. He is doing very well, thank you very much.

SOME HON. MEMBERS: Hear, hear.

MR. K. AYLWARD: We will have some samples for you very shortly.

Mr. Chairman, I think I am going to stop there because I see a lot of intelligent members of this Committee on the other side who want to ask me questions.

CHAIR: Thank you, Minister. I call upon our Vice-Chair, Mr. Shelley, the MHA for Baie Verte.

MR. SHELLEY: Thank you very much, Mr. Chairman. I guess I will start with a few opening comments and ask a few specific questions on the Estimates, because that is what we are here for. I will leave the more general issues to the House of Assembly.

I am looking forward to seeing the results of Sam's butcher shop. I am sure the minister will probably have another statement to let us know how it is going. All jokes aside, we are glad for any industry, no matter how small or big, and I am glad to hear he is doing well. As a matter of fact, I hear that we have some good samples coming that we are going to test very soon.

Now to get into a few comments and ask a few questions. I am just going to talk about a few issues very generally and maybe the minister can comment afterwards, and then I will ask a few questions. We are always addressing the wood shortage. Of course, it is always a concern, and I know it is not something that is solved overnight because trees do not grow overnight. It is something that is long term. That is the type of plan that it has to be when it comes to wood harvesting.

I have said it before - and I know it is a general statement, but it is very true - that we are the masters of our own destiny when it comes to the forest industry in this Province. We can't look to the federal government. We handle it ourselves and that is why control for the long term has to be looked at to the utmost so that we do not see things happen in the forest industry that happened in the fishery. I know that has been said over and over, but there is nothing wrong with warnings either. It was said long before I ever said it.

Then again, on the same side we ourselves seem to think we know a lot more about it, but the people who are in the industry, like the fisherman in the boat who may not have the education as far as books and so one goes, they do have a very good knowledge of the industry at the grass roots level, the same as the loggers in the forest. I think a lot of the time they feel left out. Of course, it is hard to include them, but you try different approaches. I know the minister had tried some, and it is an ongoing battle, I understand that. While the concerns are there, and as long as there is a wood shortage in this Province, I say to the minister - no matter how long he is there, or the next minister or whoever else -, it is going to be a long time before it is fully addressed. There will continue to be an ongoing debate on the wood shortage issue.

I will say this. The integrated sawmills I am very interested in because of my own district, but also on a Province level, and I know about this from growing up around the sawmill industry. I will give the minister a little background. My father was a logger, so I have sat around and listened to stories of loggers long before I listened to the stories of fishermen or miners. Everybody thought it was mining in Baie Verte, but my father was a logger, and I heard the stories for many years about the logging industry. I have said it before, and used it long before I got into politics, but I do still consider them to be the silent workers in the Province. They are the type of fellows who go into the woods early in the morning and you don't hear anything back from them. They very rarely complain or anything, they work hard and say nothing, usually. They have been a very big part of the industry in this Province. We talk about the fishery a lot, but they been there for a long time.

In that respect, I will say to the minister, here on record, that as far as the integrated sawmill industry goes I think it is on the right track. I have said it here today in the House. It is something positive and tangible. When you see somebody go to work, whether it is five people or ten people, and did something new, where they are thinking differently, that is good. Because in my own local area I saw the change of attitude in my own loggers who are doing this project now, Minister. I commend them here tonight too, by the way, for thinking like that, for coming to talk to me, and of course they came to see you. You supported it and I must commend you for that. It is the move in the right direction. It is one of the answers. It is not the only solution but it is one of the answers. I am hoping that we will move forward in that, not just in Baie Verte but right around the Province, as we see changes in technology.

Another comment I have to make tonight, because there have been lots of comments on it, is on mechanical harvesters. At least at this opportunity you get a chance to say something without getting cut off with half a statement like you do in the media, and even in the House of Assembly when you get interrupted when you are saying something.

I have said it many times. I know, everybody knows, every logger knows, I believe, that progress has to do with technology and technological advances. There is no doubt about that, I have never said that we should wipe all mechanical harvesters out of the Province or anything of that nature. I know that is a part of progress. Things will change in the mills around here and that is technology and so on. My only comment on it is this. Like I say, questions like this type are in the House of Assembly. A lot of times I am asked for the record what I think. As a matter of fact, the last few questions I have asked of the minister in the House have been for the record, to ask questions that I am being asked. I do not think they were out of line at all, and the minister has answered them.

The use of mechanical harvesters is an issue that concerns people. People at the bank are scared because they see the bank machines coming out and they know they are going to lose their jobs. It is just a natural human instinct when you see technology moving in that you fear for your job. It isn't uncommon or anything. This is something that will continue to be asked.

The one comment I will leave it with - because we cannot go on all night with it, but you easily could, on mechanical harvesters - is this. As people are replaced by whatever technology, if it is one job that is replaced, there should be some kind of indication from the government and the department - and I know you have on certain occasions; to the satisfaction of loggers it is going to take a while - that there is something for them in the industry down the road, that if they are coming out of one area that they can go into another. That is the key ingredient to it all, and that is your challenge as a minister of the day. In 1998 that is where we are, that is how the people feel about it, so that is your challenge. I just wanted to make a comment on that.

I will move on a little bit. Domestic woodcutting is a concern for everybody in the industry. We have talked about this before, that is something else that has to be addressed. It can be a real problem, especially when you have a culture like we do, and especially where, with the situation with the fishery, you get a lot more people in the woods. Certainly that has been a big factor in domestic woodcutting. I can see it in my area. There are more people in the woods now. You are saying excuse me when you are walking through the woods now, if you in the woods for anything, you see so many people in there. That is a factor that is new to you, and new to the Province, really. The 20,000 fishermen who came out of the fishery have that time now, and they go into the woods. They are either hunting or they are cutting wood for themselves. That is a concern.

I am going to mention this one tonight. It might sound like it is out of date but I think the minister will agree with me that it is not. It is the Christmas tree industry. The research I have seen on that, of us compared to Nova Scotia, and the potential for that, is something that the department and the minister should look at. I know you are, but I will continue with that thought. I did not study it as closely as I did last year actually but it is phenomenal, the potential for Christmas trees. Some people think it is a joke, but the amount of money in the Christmas tree industry in Nova Scotia - I don't know if this is right - but it is tenfold to what it is in Newfoundland right now. We can grow the industry just as fast if we do the technology and do the processing properly in this Province. I was astounded by the numbers we saw this year, when I researched it a bit, on the potential for Christmas tree farming. I think that should be pursued aggressively.

I know there are some good developments on agrifoods but I will leave most of that to my colleague here, because we are split in this portfolio, as you know. He does wildlife and agrifoods, I just do forestry, so I will stick to that.

I have two more comments to make, one on the wildlife, although I will leave most of that to him also. Just to raise a concern, I am pretty sure there are 300 new moose licenses on the Baie Verte area. Just from a person who drives the road a lot, I see a lot less moose than I saw two and three years ago. That is not scientific or anything, but I have people tell me that all the time. I am just wondering how solid our information is. I would like for you to make a comment on that later, if you could. How solid is our information on the moose population that it warrants an increase of that much? In my area alone, if I'm not mistaken, I could be corrected on it, I think there is a 300 licence increase. With that many new licenses I hope the information is accurate so that we are not doing something that we are going to regret later on. That seems like a big number.

The last comment, before I ask a couple of questions, is about the salmon licences. I know I asked that question in the House. The minister was pursuing it at that time. I have not had an update. As a matter of fact, I was going to ask that, but I can make a comment here. It is not a big secret or anything. It is something a lot of people in the Province were concerned about, about the eight salmon in New Brunswick and the one salmon here. I would like to get an update on that if we could and see where that is going. I think it is something that needs to be addressed.

The closer we get to that time of the year of course, if you know salmon anglers, boy, I will tell you, they are the most committed group to their love of salmon fishing. They are getting anxious all the time. I get a scattered call now but I am sure that is going to increase, and so will the minister's as we get closer to that. I think that needs to be addressed.

Those are the ones I have listed just to make note of here, but I know we will stick more to the Estimates, which is what I will do now in the next couple of minutes, be specific on the Estimates. Those are the main concerns that I can think of off hand. Maybe the minister can respond to a few of those now before I ask a couple of questions.

CHAIR: Minister, before you go forward with the answers I would just like to welcome to the gallery the MHA for Burin-Placentia West, and two guests from the United States of America who are travelling here. We welcome them, and it will be forever noted on the record of this House that you have been here.

SOME HON. MEMBERS: Hear, hear!

MR. K. AYLWARD: Thank you, Mr. Chairman. I thank the Member for Baie Verte, the Opposition critic, for his thoughts and some questions.

You talked about the wood supply situation. We have a couple of full time critics out there who are continuously criticising, and whatever you try to do to take care of a resource, they end up being pretty well against it. Our wood supply is in a situation where if we had done all of this forty or fifty years ago we would not have a problem. We have to take certain measures to try to protect it, and we also have to take certain measures to insure that we control what is happening out there, because if we do not control it then we are going to have further problems on our hands. That is what we are trying to do today.

In enforcement for example, we are getting tighter on enforcement, in the sense of domestic woodcutting, permits and so on. In certain areas we are looking more carefully now at some reductions, and gradually have been trying to work with people to look at that resource to make sure that we get as much benefit out of it as we can.

Our silviculture work is going very well and is being done by a lot of professional people. When you look at the fact that most of our forests re-grows on its own, then you see we have to get in and really take care of it. A lot of the trees grow so close together that they have to be thinned out. We do a lot of that pre-commercial thinning. It is a really good investment and it also creates work. People who may get displaced in some other part of the forest industry when it comes to, for example, any new technology, such as harvesters, that is the type of work we think they could be doing. We are going to be seeing in the next few weeks a number of announcements of more work for this coming season.

As you indicated, when you have technology being put forward in an industry, in one that has a tradition, which we have had for decades in this Province, then it is tough business and it is not easy. At the same time, we have a transition going on in our forest industry where we are getting much more value out of our wood supply than we did before. There is a year-round supply of wood needed, and in order for these new sawmills to keep moving they need that supply. They also need to deal with the technologies as best they can to keep them operating on a competitive basis so that their businesses are sustainable. There are other opportunities there for people who get displaced. One of the things I think this debate has done is help focus everybody towards trying to get organized, maybe, in an effort to look at those opportunities.

The other thing is that the introduction of technology, for example with the pulp and paper companies, is one that should be also dealt with at the collective bargaining table. In the past it has been, and it should still be, and it will be in the future. Our department is getting involved to a point, but the collective bargaining process is where a lot of this can be dealt with. Most of it has been, in the sense of the attrition planning that the companies do. I think in the case of one of the companies they have retired some people early to try to deal with that as they go through attrition, so they are not laying off younger loggers.

There are ways of doing it. There are some present mechanisms that are working. There are two or three areas of the Province that have probably been harder hit and I think that is problematic, but we are working with the companies. We have invited the Department of Human Resources and Employment in to help do some workforce adjustment. I talked to Julie Bettney, the minister of that department, again today. She is going to work with us to see if we can work with the companies and look at some sort of plan for people who may get affected. Like I said, there is silviculture work that could be do, which we are doing, we are investing in. There may be other work coming about; the companies are going to be trying some pilot projects and so on. We may be able to see that help out a great deal.

The other thing is that the bigger sawmills are expanding and they are going to be creating some more employment. I know a couple of cases where the bigger saw mills have taken some of their loggers and retrained them. If we can have a more organized plan for dealing with displacement, and a focus on it, I think it can really help ease the transition, and that we will have a much more solid forestry business coming up. That is going to be our aim, to get that sort of adjustment program through the help of the Department of Human Resources and Employment to get it set up. We think that should be done with the collective bargaining process and it should be done with the Department of Human Resources and Employment. We are having a meeting Friday, as a matter of fact, with one of the community groups to discuss this idea, so we can move ahead.

The other idea is that the all-around forestry worker has been talked about. You just cannot be a harvester any more. If you want to stay in one part of the forest industry when it is changing, we all have to be able to adjust to change. It isn't easy, but we are going to promote that idea, and the companies are promoting that idea.

You mentioned the Christmas tree industry. That is an industry that I think is about $500,000 in this Province now around there.

WITNESS: (Inaudible) in the agriculture side.

MR. K. AYLWARD: Yes, the agriculture side. We also have some interesting work being done on Christmas wreaths over in New Brunswick. It is up to a $13 million industry over there now. They are using the tips of trees, I think. We are going to look at potentially getting some proposals out there to see if people are interested because that is gone up there very quickly. It is a nice resource, rural economy based, and we think it could be something that could add to our agricultural industry in rural parts of the Province.

As to the moose licenses in Baie Verte, I am going to ask the good doctor, the assistant deputy, to give us a thought on that.

DR. NAZIR: The question was whether our locations are based on good knowledge, and I would like to assure the Member of the House of Assembly that they are. For the last four years we have been spending close to $600,000 a year on updating the big game inventories. This was after a long period when there were no inventories and service. Four years ago government decided that the information was so outdated that the allocations were not reliable. Therefore, we were given the special allocation.

Normally, this would have happened if this was a historical trend, (inaudible) periodically (inaudible) service, but in this year's budget $300,000 has been provided, and we are hoping that will continue on a continuing basis. That way we will have a cycle of service. Every eight to ten years the same management district will be re-inventoried; that way we will never fall behind by fifteen years. We will always have that cycle of inventories.

In certain areas, if there is a major report of lesser populations or certain variations, or higher populations where we need to harvest more, then we have the flexibility to go in and (inaudible) those areas. Our cycle is mostly complete. I think there are a few more areas which need to be surveyed and then we will get into the new cycle.

MR. SHELLEY: Can I ask a question on that? The research, you say you spent $600,000 last year, is that right?

DR. NAZIR: Yes.

MR. SHELLEY: You are going to spend $300,000 this year. That is on research surveys. Can you just tell me in a practical sense what you mean? How do you do those research surveys? Are they aerials surveys or (inaudible).

DR. NAZIR: They are aerial based by helicopters and fixed wings. There is a scientific methodology. There are lines drawn up, transects laid out, and on those transects the helicopters or fixed wings fly. There are two officers sitting in the aircraft and there is a technique. They count them. They are generally counted when the snow is on the ground. That way they can see. Then there is a correction factor built in after a fair bit of scientific research, that there will be a certain number of animals which could still not be seen, despite the fact there is snow. With the experimentation and ground checks wildlife biologists have worked out a methodology which is recognized throughout North America as a reliable method of measurement.

On top of that, we also have returns from the hunters, the successes and so forth, and there is a methodology. In fact, when we did not have these surveys and information for the last four years we mostly depended on those hunter returns. There is a methodology, again developed in North America and the rest of Canada, which is relatively reliable but not as good as actual surveys. We have been using that in the past. For the last four years we have been using both. That means one is a check over the other.

MR. SHELLEY: That is pretty accurate research, is it, you are saying?

DR. NAZIR: That is correct.

MR. SHELLEY: I did not know how it works, but it is interesting to find out.

MR. AYLWARD: If you want a further briefing we can have a couple of biologists do that, because it is interesting. I have had a number of members asking about it actually, for different regions. It is good to be able to check and see how they do it. It is interesting.

On the salmon licenses, I want to make a comment on that. We are meeting with the federal minister next week, Anderson, to discuss a number of issues, and one of them will be the salmon management plans for Atlantic Canada. Because the plan that the federal minister has announced for New Brunswick has also got a reaction in New Brunswick. The eight tags that they have allowed for New Brunswick, I think it is on about twenty-nine rivers. There are fifty-one rivers open, and twenty-nine subject to an in-season review. They are allowed to take eight.

Basically, the provincial minister of inland fisheries and the ASF and other salmon conservation groups have now set up what you would call a lottery. If you bring back your eight tags at the end of the season, just do catch and release, you are allowed to put your name into a hat or some system, and you may be able to win a utility vehicle. That is what is set up in New Brunswick. The federal minister has announced a program of eight salmon, and the provincial minister and his officials and the salmon federation and other salmon groups have announced their own program of catch and release. They are trying to get people to bring their tags back because of the concern.

There is a problem. Because if that is the way we are going to manage this resource in Atlantic Canada we have a problem on our hands. We are having a meeting with the federal minister next week, and we have indicated our problems with the way we think they are basing their decisions.

If they are going to base them on the fact that they have seven salmon in Quebec and those rivers run into New Brunswick, so therefore they have to try to stay close to that number even though the science does not tell them that they should, then we have a big problem on our hands. Because if we are going to operate on science over here... We don't have enough science in this Province when it comes to our salmon rivers, and that is the biggest issue I think that we are going to face in the next little while. We have no science for trout in Labrador, and it is DFO's responsibility. We have the greatest trout resource probably on the planet in Labrador.

We have to have some serious discussions with the federal minister, because this is a resource we have that a lot of people would love to have on the planet. It is one we need to take better care of, but when they have the federal jurisdiction then we have to get them to spend more resources when it comes to science, in particular. If you are going to manage the resource you have to know what is going on.

On the West Coast of the Province, for example, five of the rivers in Bay St. George had better results last year than they did the year before. The decisions made on the opening and the allocations were based on other rivers in the Province. On the other side of the Province they were having trouble, and what they do is they just say: All the rivers are going to suffer because we have one set of rivers that are not doing very well. When you have 176 scheduled salmon rivers we have a problem on our hands if we haven't got much science. We have science on about nineteen rivers in the Province. If they have one river here that we have a counting fence on, then: If there are ten there then we are just going to average it out. I mean, rivers are very much independent, on their own.

That is where we are. We are going to have a meeting with him next week. We are, right now, I think at one and three with the mid-season review. One salmon with a grilse, I believe, up front?

WITNESS: (Inaudible).

MR. K. AYLWARD: Yes, for the Island, on the Island.

MR. SHELLEY: Any consideration or any indications from him yet that they may increase the amount for Newfoundland from one to two or three?

MR. K. AYLWARD: There is no indication.

WITNESS: (Inaudible).

MR. K. AYLWARD: Right now it is a mid-season review that they will do in July. If they deem that to be okay, that the numbers are good, then they will give the other three, so you could have four yet. You could have four salmon in Newfoundland. It depends on the mid-season review.

MR. SHELLEY: Just to comment on that. I hate to use this comparison, but you are going to hear it a lot anyway, but the food fishery, in a funny sort of way, had the same problem with the cod fishery. If you are inconsistent with inconclusive scientific research it bothers people, and that is where the root of all this is lying in. In a funny sort of way it is the same thing again. You hear about rivers in New Brunswick, and then they do not have enough evidence to tell you exactly what is going on there, or exactly what is going on here, but all of a sudden Newfoundland has the worse end of it again. They cause more problems, the federal management of it, and I understand the dilemma you are in. Unless it is cleared up or brought a bit closer to what New Brunswick is doing, then there are going to be problems with it.

MR. K. AYLWARD: I know. It affects the tourism industry, because we have people making a living off it. We have 1,000 people, I think, who are guides now in the Province, plus the outfitting industry that is trying to make a living. It is kind of hard to advertise. If you are going to advertise for people to come to Atlantic Canada to go fishing, where are you going to go if you are coming in? Some people are catch-and-release, but other people are not. If they have an opportunity then they may go to other locations. It is a problem.

The biggest problem, though, is a lack of science. This has blown that wide open as far as I am concerned, and we are taking an aggressive approach to get this matter dealt with in the future. Some of the debate over watershed management really is coming down to scientific information. Because watershed management has really been proposals from local groups who are concerned about the fact that there is not enough science, that there has not been enough science, and they wanted to help out. It is going to be hard to take that further unless we get DFO doing the right resources when it comes to the science effort.

Thank you.

CHAIR: Thank you, Mr. Shelley.

Mr. Woodford.

MR. WOODFORD: Thank you, Mr. Chairman. A couple of observations and a couple of questions as well. Minister, one of the questions is on land consolidation. It is under the heading Land Development, under Soil and Land Management, 4.1.04. The agricultural land consolidation program has been in for some time. Where was that land purchased this year, what part of the Province? Still on the East Coast?

MR. K. AYLWARD: It was on the East Coast. I am going to give Martin Howlett, the Assistant Deputy Minister, an opportunity just to give a little more detail. It was on the East Coast, and mostly in the St. John's area, the Avalon area, I think.

MR. HOWLETT: Yes, that is the East Coast in the St. John's agriculture zone. That is the only one we have been implementing a land consolidation program into. Each year, I guess the past three or four years, we have had $300,000 to buy different parcels of land from people who are adversely affected by the zone and who want to sell their land, or farmers who are retiring. We buy the land that has to be granted land and we convert it to lease, and we release it for agricultural production.

MR. WOODFORD: (Inaudible) primarily now this year. Was that primarily in the Kilbride-Goulds area?

MR. HOWLETT: No, it depends on the applications. It is done by application. Each year we get x number of applications and then we negotiate. The reality services in Government Services and Lands does the negotiations for the department. They actually do the purchasing of the property. It could be down in Windsor Heights, Torbay, Portugal Cove, Goulds, Kilbride, Logy Bay and so forth. It is all done by applications. We take the applications in number. We do not have enough to purchase all the land that we get applied for, but we take them each year based on what we can do with $300,000.

MR. WOODFORD: What acreage was purchased this year?

MR. HOWLETT: The average price per acre has been somewhere around $4,000 to $4,500. We do not have enough to buy big acreages anymore. One time in that subhead there was probably in excess of $1 million.

MR. WOODFORD: (Inaudible) $4,500 per acre.

MR. HOWLETT: Per acre.

MR. WOODFORD: You are leasing it back for what?

MR. HOWLETT: We go out and ask for proposals. We will set a minimum price. It depends on when we do an assessment of the land: the number of acres cleared, the number of acres suitable to clear, the number of acres not cleared, and the number of acres that might be bog or wet. We will do an assessment, set a minimum price, then we will ask for proposals, and we will lease the land out based on the best viable proposal.

MR. WOODFORD: Your figures here and the figures that you have quoted in regards to purchase, it isn't just cultivated land, it is total?

MR. HOWLETT: We will buy the total land.

MR. WOODFORD: That is the average for total?

MR. HOWLETT: That will be that average for the cleared. Your others will be somewhat less, your non-cleared, and so forth, but that is roughly the average for good, cleared productive land, about $4,500.

MR. WOODFORD: Has the department given any consideration to expanding that - I have asked this question before, over the years - to other parts of the Province?

MR. HOWLETT: We have certainly talked about it, but again it all comes down to budget allocations. We do not have enough here now to satisfy the need just in one area. It happened to be done in that area because in the Goulds, Kilbride, or St. John's area we call it, that is gazetted ADA, agricultural development area. The only other one gazetted is in the Wooddale area. We have about another eighteen in the Province that are designated but not legally gazetted. We have roughly twenty ADAs.

MR. WOODFORD: The other reason for it here would be the shortage of land overall, I guess, and to make sure it stays in agriculture.

MR. HOWLETT: I guess it goes back to the land freeze. That is what it is referred to. We call it the land zone. That started in 1973 (inaudible). There were alterations made to it after that on a number of occasions, and it was in 1996 that a land consolidation program came into effect. As you can appreciate, we had a lot of catch-up to do, because we went from 1973 to 1986 with the property protected for agriculture and only allowed to be used for agricultural development with no land consolidation program. The land consolidation program came in in 1986. We are still, I guess, in an catch-up situation in terms of demand on the program.

MR. WOODFORD: I noticed that under your heading for limestone services, 4.1.02, you budgeted $284,000 and you spent $252,00. You have $284,000 in again this year, which is good. Although I suppose it is primarily now to build up and keep land in a good state for cultivation purposes. Because there is not a lot of new land development now, is there? Or is there? Do you have any figures on the acreages (inaudible) land development?

MR. HOWLETT: I could not tell you the acreage, but last year our land development was up somewhat. I guess it was up for probably two reasons. The first is under the safety nets program, and that program applies to a non-supply managed commodities. Some (inaudible) groups get small amounts of land for land clearing. The other one was when the federal fee freight assistance program was eliminated by the federal government, they made a payment to farmers up front. Some of the farmers took those dollars and put them into land development and developed more land for forage so that they would have less reliance on imported forage and grains. Those would be the two reasons. The number appears this year as the same because we anticipated the same thing happening this year. There are some more lands being cleared through some of those dollars and probably some more through the other program.

That is for bulk limestone only. We do not get into bagged limestone, only for the Labrador part. We will ship bagged limestone to Labrador, and last year we shipped very little, I think probably a couple of car loads. It is mainly bulk limestone at $25 per ton. That price is right across the Province. Everybody pays $25.

MR. WOODFORD: Just an observation, Minister, and you can make a couple of comments if you wish after on the integrated sawmills in the Province and the increase in lumber production.

I just did not get the figures that you had there tonight, the increase in the lumber production in the Province, but I know in my area I can speak for the integrated system and what has been happening there. It has been a real plus for the area, for the whole region, not only just for the community of Cormack in which I live, and that is primarily where the integrated system is working really well now. Paul mentioned about the wood supply shortage and everything over the years. It is sad when you think about what could have been done over the years, and when I look at other provinces and see that there are probably enough chips lying on the ground in Quebec to keep the three paper-mills in this Province going. They are just lying on the ground, wasted, and we are talking about a shortage of fibre here in the Province.

We never had total utilization of the resource over the years. When you look at what is happening now, it is almost unreal when you see what has happened in just twelve short months with regards to the total usage of the integrated system. In the South Brook area there are five or six sawmills, and here you are with the slabs over the bank, sawdust over the bank, the planer shavings over the bank. When you go up to Cormack and go through Don Wells' mill, they have a tractor-trailer going twenty-four hours a day just hauling chips into the mill in Stephenville. When it isn't, you have them hauling the sawdust to the farms for bedding. You have trucks going out steady with load after load of finished lumber going to market outside of the Province.

When I had the Department of Works, Services and Transportation for the first time in the history of Cormack put a half load limit on there about a month ago, I got a phone call. There were twenty-two tractor-trailer loads of logs out on the Bonne Bay Road waiting to get in, all from the Roddickton area. Now you talk about -

MR. SHELLEY: A great problem.

MR. WOODFORD: Yes, a great problem. It went on in the morning, here they were to come in, and they saw the sign there. You talk about stopping progress. At the same time, look at the total utilization of a product, of a resource. It is so good to see. I have not talked to him lately, but there was even talk of the bark, the planer shavings and the sawdust going for hog fuel to Kruger, or to the hospital in Corner Brook. It is unreal, that total utilization of the resource.

You were talking about one for Baie Verte. I think it is a wonderful thing, but I would go a little further in saying that the licenses and the quotas that are issued should probably come under the integrated mill itself. They should be tied in somehow. Either one permit issued or the permit issued to the individuals involved there, but they must sell to that integrated system. We have gone for too long showing this wastage and so on. We have proof now of what can happen.

The mill in Cormack last year closed down on Christmas Eve. They were in doing repairs on Boxing Day and they started right on from there. The week after that they had the full crew back, and I would say that they will be working for eleven and a half or twelve months this year. One time in the mills you would get a few months work and that was it, close her down. Because once the frost comes, the old push carriages, you would not use them, you would just close everything down and that is it, everything would lie there. Now it is so good to see the total utilization of the resource. I think it is the way to go.

Not only that, but what I am noticing too, and I am sure your department is noticing, is you are getting the cooperation of the paper companies. They have too, they must. Because now you see them hanging off ships over in Germany somewhere, or a few Greenpeace running around on the decks of a paper boat somewhere with nothing on, trying to get attention, and drawing attention to the environmental aspects and what is happening in the industry.

When Kruger and Abitibi and those big companies can come and say: Look, we are falling in line, we are playing the game, we are doing things right, and we are utilizing everything, I think that is good for the paper companies, it is good for the extra jobs in the communities, it is good for extra exports going out, and it is good for the whole economy. I think the paper companies are finally realizing that. I notice out our way they are doing it. Not only in exchange (inaudible) one time, you come and say: We will give your fellow there 5,000 cubic metres to keep his mill going, but we want it up in Howley, we want it back somewhere else. They are still doing that too. I see now when they see that they are going to get the chips for good fibre to their mill, I think it is going to benefit everybody.

There are a lot of other things I could say with regards to the paper mill industry and the woods in general, but I will just leave it at that, but I just wanted to make that comment. Because it is a good one, it is a growing one. We have one about to open in the Hampden area now, an example of what I said earlier with regards to the small mills all going through one mill. We had five operators out there. Instead of issuing a permit to each one of them now, we have issued one permit to the integrated mill operator, and I think they have pretty well come to an agreement on that. I have not been talking to them lately, but I think they have finally come to an agreement to issue the one permit. They are all going to work for that mill operator into that one system, Fred Osmond of Hampden, and that is about to open I think in another two or three weeks. It is another example of coming together. They also have an allocation from Kruger there now as well, so it benefits everybody.

Here is another example. They used to finish in October because they could not get down to Chause Brook, and now they have an allocation for a winter cut up on the Hampden road, so they can go pretty well all year. Anyway, that is enough. Mr. Chairman, thank you very much.

CHAIR: Thank you, Mr. Woodford.

Minister.

MR. K. AYLWARD: What you just described is exactly what the situation is. Unfortunately, just look at the transition we have had to take to get here, the wastage of some of that wood supply. It takes some time to get it right, and it takes you a few years to get a process in place, but there is some rapid progress being made now. Look at the fact that Kruger is putting in a wood chip handling facility, and it is just about ready. I think it will be ready in July of this summer. Will it be ready this summer? Yes.

When the pulp and paper companies do not need to be pushed, and our policy has been to move towards that and to get them to do it, they have been very much coming up to the door and saying that they see they should do it, for a lot of reasons, including environmental ones. There is also the fact that if there is a good stable sawmill industry, which will provide them with wood chips, that means they are going to have stability for the future. It is the full utilization of what is occurring with our wood supply. Those sawmills are using really small timber, timber that did not get used before. It is absolutely amazing the size of the timber going through the sawmills.

MR. WOODFORD: (Inaudible) a couple of fellows now going around the Province. I know there is one other mill in my area now that is going to go out to the saw mills to take some of the slabs. They can sell now as much as 300,000 feet to 400,000 feet of this one by four or one by six or one by three, just four or five feet long. They are now going around. They have markets now for 300,000 feet or 400,000 board feet of that alone. They are out around the Bonavista area now doing the same thing, looking and just going around for the mill.

MR. K. AYLWARD: That is right. That is amazing. In the last few years, given the history with the licenses that were allocated years ago, the companies have come around. Also, the policy of the department - well before I got there, but in the last few years - has been to push these companies very hard to start doing this. Dr. Nazir deserves a lot of credit for getting the companies to move ahead, and I would like to thank him for helping the progress move along. Because convincing the companies with the levers that we have, given the licenses that they have had, has not been the easiest thing to do, but that has changed also. The introduction of the forestry act in 1990 has helped this industry come a long way also. Given the fact that there has been a very strong push by the Province and also the fact that the companies have responded well, we are now seeing a lot of exciting things happen with our wood supply that did not happen before.

One of the other things that is occurring is we have hardwood operations being looked at now for the first time in many years. In years, we have never had them looked at before. The companies, in particular Kruger, I know of two or three that have worked out arrangements so that certain types of hardwoods can be taken and some value-added can be done. I think one of them is up in your district, I say to the MHA for Humber Valley. We can see there we are going to get some value out of a wood supply that we hardly used and we just wasted. It is very positive to see.

The other thing that is being looked at by some of the bigger integrated sawmills is co-generation of electricity. There is an evaluation under way now for the integrated sawmills to look at the use of their wastage, to see if they can use that to do some electricity. That is happening in other provinces. There is no reason why it cannot happen here. Again, you would not have seen it a few years ago. You are seeing all of that occur now and it is rapid. We are really catching up and it is really good to see. The value-added of our wood supply is starting to go right through the roof and it is good to see.

CHAIR: Thank you, Minister.

Mr. Fitzgerald.

MR. FITZGERALD: Thank you, Mr. Chairman. I would just like to open by saying that when you think of Bonavista South the first thing you think about is the fishery. I would say probably in excess of 70 per cent of my district is directly related to the fishery. How I should phrase it is that the logging industry and the agricultural industry is very important there as well, in the Lethbridge area for agriculture and then all the way down the Peninsula for logging. There are probably more small sawmill licenses on the Bonavista Peninsula than there are anywhere else in Newfoundland, if I were to guess. I don't know how many are there, but there are certainly well in excess of 100, maybe closer to 200, sawmill licenses.

There is one thing that I think that we have to look at when we talk about those new sawmill ventures. I have two of those there, Jamestown Lumber and Bloomfield Lumber. Bloomfield Lumber is presently using a new type of milling operation. It may be the only one in Newfoundland, I say to the Deputy Minister, the chipper decanter, where there are absolutely no slabs. It is all done with knives instead of saws. Those people are sawing logs right down to a three inch, probably even smaller, and making some very good products from it. The problem they have is with the bark. We do not seem to be able to escape either year but that we don't have one or two major fires there. Thanks to the response from your department last year you probably saved one of those mills.

I think Jamestown Lumber probably goes through the experience almost every year of having this bark catch fire and cause some problems there, but he responds to it in a very professional way. For the most part there it is a problem but it is being dealt with. Hopefully, one of these days we will see something that we can do with some of this bark. That is about the only thing that is not being used. I understand that there is even some exchange of wood products now between the paper mills and the sawmills in that particular area, which is encouraging to see as well.

I know the former minister and I talked about some of the problems with forestry and sawmill operators. He talked about maybe one way of solving the problem was to have the sawmill operators own the permits for cutting. I totally disagree with that. I am a firm believer that millers should mill and loggers should log. There are many people in my district who have invested a lot of money in the logging industry and they are finding their quota reduced more every year. Sometimes it is frustrating to see those people unable to make a living when we see the sawmillers controlling many licences. I am not so sure if that is the way that it should work.

As far as reducing the number of sawmills, maybe we should give the sawmill operators some kind of assurance that if they don't square up their timber - because I think they should be encouraged to sell the logs round, and they can get just as good a price for them. A lot of them are reluctant to do that because they are in fear that if they don't use their sawmills they will lose their sawmills. They have been promised things in the past and it has not worked out and some of them have had some very bad experiences. Maybe if we could assure some of those sawmill operators that if they did sell their product, their fibre round, then they would not lose their sawmill licences. I feel that is the only reason why a lot of them square up their timber, and as you know this makes the mess of slabs around and sawdust, when it all can be used differently, and probably made into a much more sellable product at the mill itself.

Minister, going back to wildlife, has there been any increase in the number of moose licences that have been issued this year?

MR. K. AYLWARD: I will defer to Dr. Nazir. I think there has been. There are twenty-eight (inaudible) resident and non-resident. Go ahead, Doctor.

DR. NAZIR: Yes, there have been a number of increases both in caribou and moose in certain areas, but in some areas they have gone down. Overall there have been increases in both. I have the information here. In fact, this information was published in the application guide, area by area, how much each area increased by both moose and caribou.

For example, if I go in, say, moose, in the case of St. Anthony there is no change, in the case of Portland Creek there was an increase of a hundred. In Area Nos. 3 and 3A there was no change. In Area 4, which is Taylor's Brook, there was a reduction of 240. In the next five areas there is no change. The next two had reductions, the next one is 300 up, the next one 100 up. It was like that. When you add them up, the minuses and pluses, overall there was an improvement.

MR. FITZGERALD: How many extra licenses were granted to outfitters, Dr. Nazir?

DR. NAZIR: If you would bear with me for a minute, I will have to get this information.

MR. STANLEY: Probably I could just make one comment - while Dr. Nazir is digging that out - on the sawmill policy you talked about. We are developing a new sawmill policy to try and reflect this change taking place in the industry. Right now if a sawmiller sells his logs to an integrated mill then we will give him credit as having sawed his logs for the purposes of retaining his licence. If he sells his logs to an integrated mill and it is done, and we know about, he comes in, I mean, we will do that now. Obviously that is the direction our policy is moving in, to try and get all of these logs going to integrated mills.

As you will appreciate, especially down in the area where you are, there is a long history here, and a lot of people who have done things in a certain way for a lot of years. We all agree the direction we have to go in. We just have to do it in a way that hopefully won't result in too much hardship on too many people. We are moving in that direction. As I say, we do now recognize that if someone brings their logs to an integrated operator then we will give them credit, if he indeed has a sawmill license.

MR. FITZGERALD: You will probably have a little bit of trouble gaining the people's trust on that. Because you know that in the past people, if they did not use their sawmills for two years or something, they lost their sawmills. It might take a little bit of getting used to there, or going out and approaching them in the right way, because I think a lot of them might be a little bit reluctant. You know about that, you know the people there, Mr. Stanley, very well.

DR. NAZIR: I have the information you asked for. In 1998 there were 2,997 moose allocated to the outfitters for the non-residents.

MR. FITZGERALD: Two thousand nine hundred and ninety-seven moose.

DR. NAZIR: Two thousand nine hundred and ninety-seven moose. This is approximately 10 per cent of the total allocation. That means the other 90 per cent went to the residents. In the case of caribou it was 1,458, which is approximately 25 per cent of the total allocation to the non-residents. This was an increase of 318 moose and 330 caribou for a total of 648 big game to the outfitters.

MR. FITZGERALD: For this year?

DR. NAZIR: For 1998.

MR. FITZGERALD: For 1998. What percentage is that of the total increase?

DR. NAZIR: The total for 1997 was 3,803 and the total for 1998 is 4,455, so that is...

MR. FITZGERALD: I am talking about the total percentage this year. What percentage of the increase this year went to outfitters?

DR. NAZIR: I don't have that percentage readily available here, but our total moose allocation was 28,320.

MR. FITZGERALD: Can you just give me the total increase for licenses this year, and then give me the total increase that outfitters got of the total number of licenses?

DR. NAZIR: I don't have the percentage there, but in terms of the increase I can tell you that there are 652 animals over 3,800. So that is about one-sixth, about a 17 per cent increase.

MR. FITZGERALD: A 17 per cent increase, okay. Under the new rules, the new change that the minister read a ministerial statement about here a few weeks ago, where, Minister, you allowed the visually impaired to now take part in moose hunting with a designated hunter, does that also include the physically disabled?

MR. K. AYLWARD: Yes, it includes the physically disabled. Everybody. You have to go through the hunter capability test, the education part of the program, and our department will be making the changes to the program. They also have to deal with the federal arm, I believe, of the program with the Department of Justice federally to make some changes. We will be doing it similarly to what they do in New Brunswick where they allow for the designated hunter for a person who qualifies to be able to go under the program.

MR. FITZGERALD: It does?

MR. K. AYLWARD: Yes.

MR. FITZGERALD: First of all, looking through this book here, The Economy: The Future is in Our Hands, I thank the minister for including a family from my district. Probably one of the biggest root crop growers in Newfoundland and Labrador, the Peddles from Lethbridge.

One of the things that the Peddles, as well as other farmers, continually talk about is the problem where they have to compete with vegetables from other provinces arriving here at a time when they should be getting premium prices for their own. One of the things they have suggested that might be able to be done is if the government instituted some kind of policy that we once used for the sawmill industry. That was where we allotted sawmillers a sum of money to allow them to buy lumber and store it, and have the sawmillers pay back that money - I don't know if there was ever any interest charged or not - and be able to sell it a time when it would demand a higher price and when there was a demand for it.

I am a firm believer that that might be able to work very well with the agricultural industry as well. None of them can afford to take their vegetables and store them without having some form of cash flow, but I think it is something the government probably should seriously look at. If we do not want to interfere with product coming in from other provinces - when we look at the direction that we are going in now, when we are tearing walls down and opening up doors - then maybe we might be able to look at providing those people with funding where they can hold their vegetables to a certain time, then have them sold. Even if we charged them a small interest rate I don't think there would be any argument with that. I wonder if the minister has given any thought to that, or if he has been approached with that idea before.

MR. K. AYLWARD: Thank you, Roger. We have been giving some thought on how do we get more procurement with our farmers and their products into the procured system, especially with the bigger wholesalers. We have had some meetings on that issue, as a matter of fact, with some of the bigger wholesalers to try to identify the problem areas.

I am going to ask Marty Howlett to comment on it, but one of the things that was tried I think a number of years ago was some cold storage for some regions. It was tried to see if we could get our vegetable producers, in particular, to look at doing it, so that at certain times of the year, when there is a big demand, that they would be able to guarantee to the bigger wholesalers that they would be able to have a supply, which has been the biggest problem identified to us. I will give it over to my assistant deputy for agrifoods so that he can give you some further thoughts on this. It is a good suggestion.

MR. HOWLETT: What you are talking about is an advance crop payment program, that farmers could draw money down on the crop that is in storage. In the past we had, with the Farm Loan Board, operating monies available which worked on the same premise that farmers would borrow in the spring, say for fertilizer, seed and so forth, and pay it back in the fall. We do not have that program now. We did look at an advance crop payment program. We did have some storage programs over the years for assisting us, for vegetable storage, with the proper cooling facilities and so forth.

One of the problems we run into is a lot of farmers do not have adequate holding facilities to hold a crop to bring it probably into January, February and March. In your area some do have some pretty good storage, but overall that is not the case. When you get the crop ready for market in October, November, everybody wants to sell their crop at the same time.

In some of those meetings the minister referred to that we have had with some of the bigger wholesalers and the bigger food chains, what they are talking about is the continuity of supply. Good quality product, Grade A product. They are prepared to do business with any groups of farmers or any large farmer who can bring them ample supply. There are not much interested in doing business with a bunch of pick-ups or what not backing up to their door, because they are not set up that way these days. They are set up for big trucks, tractor-trailers, and so forth.

That is a possibility we could look at into the future, of how to get farmers organized. We made attempts at it. There have been several attempts, as you are probably aware of, over the years, for marketing boards and so forth. The vegetable one just did not get off the ground. There were two attempts tried, and there was VMAL, the Vegetable Market Associates Limited, which you can probably recall, and certainly Mr. Woodford can, and a lot of these things just did not get off. It comes down to a point of organization. That point was driven home with the meetings we had with the minister and with those people. It has been properly organized so that you can deal with them ten, eleven or twelve months of the year.

We have our marketing people and that is what we are trying to do now, to look at that. Not the marketing board system, but some kind of system where it is organized, there can be a continuity of supply, good quality and so forth. When I say good quality, I mean this. When they get product in, they either want it done, packaged in their bags, five pound, ten pound and so forth. There is not a lot now dealing in fifty pound or hundred pound sacks these days.

That is the kind of things we are working on, to see if we can change the system through that process and that opportunity, because we have tried a lot of the others. Unfortunately, the vegetable one is one that just did not take off in some of this organized marketing like the others. That is where we are with it right now.

MR. FITZGERALD: I will also mention something, and I am not going to say much about it because I don't know very much about it, and that is the situation this year where a lot of our farmers have been disallowed from drawing unemployment insurance. Many of the farming families drew unemployment insurance because, as you know, there are a great number of weeks there, and months even, when farmers do not have an income.

This year many of them have been faced with having to pay back monies that they received from the unemployment insurance or the EI program and have now been disqualified. I don't know how many farmers are going to go out of business because of this. Has this been a problem that has been raised with you, Mr. Howlett or with you, Mr. Minister? Are you aware of it? It is something we should work with the federal government on, I think.

MR. K. AYLWARD: No, this is the first time. I tell you, I did not realize it. I have not had any inquiries on it. This is the first we have heard of it. We would certainly like to hear more about it if there is a problem.

MR. FITZGERALD: It has been a problem. I have received several calls, and I know that there has been an individual who has taken up the cause for those farmers somewhere out around the Bay Roberts-Shearstown area. It is a problem.

I will move on to the next item, Mr. Minister. I have been waiting patiently for you to announce our farmers versus moose problem, and I still have not heard it. I expect every day to hear a ministerial statement. The problem can be solved within our own hands here, I don't think we have to depend on anybody else to solve it. It is a major problem. We are soon going to be up to the time of the year again, when farmers are going to be very anxious to hear what your department has done. You have had meetings, you have made your intentions known here in the House, but still we have not heard anything positive. Can you tell me when we can expect to hear that or what you will be announcing?

MR. K. AYLWARD: Thank you for that scathing attack. I am having a hard time getting up here now to answer that question. No, I do welcome the comment. We are, on two fronts, trying to deal with that problem. The Assistant Deputy Minister for Agrifoods can give you a quick update on where we are with the crop insurance, because we have also looked at that issue. I think we have made some progress there, and we will be ready to give that in a statement very shortly. We are just about ready to make a final decision on what we are going to do, if we are going to look at a pilot project of some type in that area in particular with the moose situation. Our wildlife people are looking at it and they are going to give us a final recommendation shortly. Go ahead, Mr. Howlett.

MR. HOWLETT: What we have put together as a pilot project on the moose situation is a result of our discussions in your area with your producers and some other areas in the West Coast which also have the problem. We have a problem also now with caribou. When the caribou come, they do not come in ones and twos, they come in fifties and sixties and hundreds. This will be tied to the crop insurance program because, as of now, as the Minister said, we are trying to attack this on two basis. One is nationally. They are looking at trying to get a program for wildlife damage. They are calling it wildlife and waterfowl across the country, and that has been headed up by the Canadian Federation of Agriculture. Our federation has had input, farmers and so forth. We are working on that aspect. That is going a hell of a lot slower than I anticipated it would, and I guess slower a lot of people figured.

What we have done in this Province is this. In our crop insurance program, the way the program works is that for the first 60 per cent of risk the premiums are shared on a 50-50 basis between the federal government and the Province. You can then buy up from the 60 per cent up to 80 per cent on a shared basis: 30 per cent with the federal government, 20 per cent with the Province, and 50 per cent with the farmer.

We are going to tie what we call a moose pilot project to this for a two year period. We are going to finance it out of the safety nets program which we have. You will have to be tied into the crop insurance program because that is the only way we have to monitor it, because our crop insurance people do the tests to get the yields and results. What will happen here is if you buy up to 70 per cent you basically have 30 per cent uncovered, so your first 30 per cent loss is out of your pocket. What we are going to do under the pilot project - or what is proposed to be done, I should say - is we will cover 70 per cent of that 20 per cent or 30 per cent, the up front, which if you have 70 per cent coverage it is 30 per cent now, and if you have 80 there is 20.

We will cover 70 per cent of that, which would give you, say, another 14 per cent on 20 per cent, or 21 per cent on 30 per cent, for a two year period as a pilot project just to get some results, to get some figures, to see how accurately sound it could be. Then hopefully some time in that two years there will be a national program coming along.

That is the program that we have gone out and had some discussions with some farmers and so forth about. That is the best we can do at this juncture, because the crop insurance program is a federal-provincial program. It has taken me several discussions to get the national people on side to say: We will try it as a pilot. Some other provinces have done the same thing for waterfowl, so that is what we are going to advance forward.

We will take the case of a guy who goes up to 80 per cent and he has 20 per cent not covered. Seven times two is fourteen, so he is about 94 per cent, roughly now. It probably might be a bit different, it might be 92 per cent or 93 per cent, but that is roughly where it will be. What we have done, we have taken some of that front risk he was carrying when he got the loss that was automatically deducted, we are going to take some of that and put it into this pilot project. That is what we are going to do.

MR. K. AYLWARD: (Inaudible) have a recommendation shortly on the pilot project, on the moose side, to deal with that. We had the suggestion of the program they did about ten years ago where they had a separate pilot project. Our officials have been looking at it and I have just been waiting for a final recommendation. I should have it any day. We will be coming shortly with an answer for you on that.

MR. FITZGERALD: Minister, I do not know if I understand Mr. Howlett correctly or not. Surely we are not talking about tying the moose problem, which is in our hands and we are capable of controlling, into a national problem with crop insurance are we?

MR. HOWLETT: That can be covered (inaudible), that is what we are going to do. That can be covered under crop insurance as an add-on peril.

MR. FITZGERALD: Why would you do that? Why would we expect farmers to pay a premium for damage caused by moose, a predator that we protect, when it is totally within our hands to change a policy to solve the problem? This is not what the farmers that I have been talking to are asking for. I think we are trying to make it more difficult than it is now. Why can't we implement a program that was put forward seven or eight years ago? The only reason that program failed, in my understanding, was the fact that if people applied for the early hunt, and if they were not successful, they were not allowed to continue in the regular hunt.

Why can't we build that in and have the early hunt again, have the people who are unsuccessful to continue with the regular hunt, and have it controlled by the wildlife officers and the farmers in the area, as was done before? The farmers agree that that should solve the problem.

MR. K. AYLWARD: Just in case it does not solve the problem, we have a crop insurance plan. We have been looking at as many options as we can to offer because the farmers themselves have that crop insurance. They have the insurance plan. A lot of them have it, and some of them do not have it. They will have some options to look at in dealing with the problem. Even if we make a decision to go with a pilot on dealing with the moose in particular, it still may not resolve the problem for some farmers.

We are looking at whether or not we can do one or two things or do two things to see if we can help deal with it. We own the moose, I suppose, but at the end of the day we are trying to find a way to get as inventive as we can to deal with the situation and to give them some protection, one way or the other.

MR. STANLEY: Just one point I guess on that. The hunter solution is one we will be looking at in terms of a pilot, but the hunter is a very difficult solution with caribou. If you get the kind of caribou going onto a field that you have over in Cormack of 100 animals or whatever it is, shooting 100 animals is not a solution. There has to be other ways identified to try and address this, and one of them - I guess this is what Marty is saying - is that there can be some financial protection for the farmer in the event that everything else fails.

MR. FITZGERALD: Yes, I totally agree, but where we have a moose problem can't we implement something to deal with moose? In the Lethbridge area we do not have 100 moose. We are talking about probably two and three. Moose do not herd like caribou. I think it falls within your department. The ability to solve the problem falls directly with your department rather than having to look any further.

MR. K. AYLWARD: We are looking at the broad range of options because we also have problems in other parts of the Province with different wildlife. Marty, do you want to go ahead?

MR. HOWLETT: What I tried to do here from the agriculture side of it is this. We have a program there that is now in being. We have the safety nets program, which I think we had in another couple of provinces across the country that did comparable programs or pilots in their own provinces. I looked at it as an opportunity to try and keep some of those dollars in the farmers' pockets. I know the moose is a concern, but when a moose eats 30 per cent of his income out of his pocket, that is his greater concern.

On the wildlife side, they are looking at the pilot, the hunt and the extra and so forth. I guess I tried to move this forward from the meetings we had to try and have something for this year rather than say: What do we do with the moose, the early hunt and so forth? This was doable. I know it is a good deal for producers who take out crop insurance, because they could come down to having a very small percentage of their income if the moose hit them, eating out of their pockets. If we leave it the way it is, they will have 20 per cent or 30 per cent to absorb and that is what is killing them. Because even with the early hunt, more hunts -

AN HON. MEMBER: (Inaudible).

MR. HOWLETT: Even when we had it, it worked yes, but some farmers still had a fair loss. What I tried to do was put something together that would keep money in their pockets. They may put together a program eventually that would keep some of the moose out of the fields, but I felt it was kind of urgent. With discussions we had with your and some other people we advanced this one forward, and the federal crop insurance people are on side with it. I do not think we should, at this juncture, probably be having second thoughts. It is only for two years, at least to pilot it, and then we will have some actual facts to base other decisions on.

MR. FITZGERALD: Yes. It is certainly urgent, and you understand the urgency of it. Hopefully something will be implemented that will help the farmers this year.

Mr. Minister, I understand the fire patrol personnel in Clarenville and on the Burin Peninsula are being called back, probably as we speak, today or tomorrow. The station in Bonavista South, in Southern Bay, the people there are not being called back for some time yet. Can you tell me the reason why?

MR. K. AYLWARD: I will ask Dr. Nazir to give you an update on that. Our people are being called back as per normal but we are getting ready and geared up for the season.

DR. NAZIR: We have always a fixed amount of money, and the fire season sometimes starts early, sometimes late, sometimes it extends late into the fall. What we are doing this year, which has been our practice for the last number of years, is that when the fire hazard is not high in the spring we recall some of the people to begin with so that they can start getting the depots ready.

In fact, there was one year when we called only a couple of stations and they could respond to any sporadic fire here and there, because we do not get large fires at this time of the year. We get small fires, ten feet by ten feet, by 100 feet, 500 feet, that type of fires. When we get towards mid-May you are likely to get larger fires. By that time, then, we are pretty well fully geared up. What we are doing is this. It has been our past practice, depending on the history of fires in certain areas, we decide to recall some of the people early. Within the next week or so all will be manned fully.

MR. FITZGERALD: In heading 2.2.02, Fire Suppression and Communications, Salaries are being decreased by $139,800. Can you tell me how many positions are being done away with and where that is going to occur?

MR. K. AYLWARD: I think last year it was budgeted at $1,082,100 and then we went to $1,152,400. We budgeted again $1 million this year, but we pretty well expect that we will have the same staff as we had last year. Even though it shows that there we expect - as we made adjustments last year within our budget overall - that we will have pretty well the same staff. It shows a little difference, but we will end up with pretty well the same staff numbers.

MR. FITZGERALD: You are saying that part of the budget is not really accurate.

MR. K. AYLWARD: When they did the budget last year with $1,082,100 it ended up about $75,000 to $80,000 more, at $1,152,400 in revised. We are at $1,012,600. Depending on the season, what is budgeted there we may have to find a bit extra if we deem it appropriate, but we have planned for the same staff complement for the summer.

DR. NAZIR: For example, last year our budget for salaries was $1,082,100, and we ended up spending $1,152,400. If there is a large fire then we go back to Treasury Board and obtain additional funding. So this is (inaudible), whatever the budget is, just to man our depots in case of any large fires. If we end up hiring additional people, then we go back for special warrant, or if there are savings somewhere else then we would go to Treasury Board to get permission to transfer that.

MR. FITZGERALD: Heading 3.1.04.01, Wildlife Ecosystem Management Planning. The budget was for $559,800 last year and it was revised to $298,600, a reduced expenditure of approximately $261,600. Was that positions that were done away with or has it been a combination of -

MR. K. AYLWARD: The department was restructured and a number of positions in this part of the department were moved to another part of the department. You will see in two or three places a substantial increase in one section and a substantial decrease in another section basically because they are restructured and moved around. Dr. Nazir, do you want to add to that?

DR. NAZIR: That is correct. There was a little bit of reduction on account of Program Review, but most of the direction is explained by what the minister has said, restructuring. Some of the biologist positions were moved into field. You will see under the operations, regional services.

We also have created a new division called the ecosystem health division. Essentially, that was both forestry and wildlife. In the past there was a gap. Forestry looked after the product of forest lands, wildlife looked after the animals, but we were not looking at the overall ecosystem, so we have created a new division called the ecosystem health division. Similarly you will see a number of other areas where there is a salary reduction; for example, in the case of Wildlife Ecosystem Research and Inventory, the next subhead also, it is the same case. There are a number of areas where we took those positions and put them into the new areas.

MR. FITZGERALD: Mr. Minister, information technology. If you look through the budget there must be millions of dollars spent on information technology. Is that the purchase of computers or the purchase of software? What is costing all the money?

MR. K. AYLWARD: There is one area there, 3.1.01 in particular, which has the largest amount for information technology. A new system was developed, I think, a one-time development cost. You will see there under .12 it was budgeted for $125,200 and it went up to $433,600. That is a new financial information system that was developed one time, I think under the NISL agreement. I think NISL probably did that. Other than that, most of the IT budgets are for those divisions and they - go ahead.

MR. STANLEY: If I could just add something. Most of the work we are involved in has a high use of information technology. Our forestry inventory system is all computerized, it all goes out into our district offices through computers; the wildlife inventory system that Dr. Nazir just talked about; our system for tracking moose licenses, trends, how many hunters were successful. We have a high component of computer use in information technology, and those dollars would be for equipment and people to implement that. Sometimes we hire consultants, other times we do it internally. By the very nature of what we are doing is we have a significant proportion of information technology built into it.

MR. FITZGERALD: Is most of that money is being spent with Newfoundland Computer Services or does it go out on contract?

MR. STANLEY: Some of it is spent through government's contract with NewTel Information. In other cases, where it is very specialized work, we have had to do it through other contractors, but most of it would be through NISL.

MR. FITZGERALD: Last year, especially in my district - I am more familiar with it than anywhere else - there was a program or there was a policy by the Department of Forest Resources and Agrifoods where it allowed loggers to take extra timber in order to clean up blow-downs and diseased timber and what not. Is that policy in effect again this year or has it been eliminated?

DR. NAZIR: That policy is under review. That policy essentially was in the Bonavista-Clarenville area, where there was a lot of backlog of some of the areas which were previously high-graded and needed to be brought back under production.

There were two components of that program. Most likely we will continue with one form but overall there are a number of practices there which are under review. We are going to make a presentation to the minister and he is aware of some of the options there. No final decision has been made, but in the next few weeks we will be consulting the local MHAs before we make a final decision on it.

MR. FITZGERALD: One final question. I understand, Minister, that your department is putting together a new policy for a unit two. I ask you when you are doing that not to forget the domestic woodcutter. Even though I know that your interests and, I suppose, the reason why we exist is for the commercial cutter, but the domestic cut is certainly very important. A lot of people on the Bonavista Peninsula depend on firewood to heat their house and to cook. A lot of people do not only use it for the three or four cold months in the wintertime but use it for the twelve months of the year still. Many of them live in older houses. I don't know how they would support their families and continue to provide if they were not allowed to cut firewood in order to fulfil that need. So no, they should not be in cutting logs and prime timber, but yes, I think they should still be allowed to go and get the firewood to continue that practice. I think they should be allowed to do that in the certain areas you people have laid out.

Thank you very much for your answers.

MR. K. AYLWARD: Thank you, Mr. Fitzgerald. We will be briefing you shortly on the unit two also because we will be talking to you about the unit two plan.

MR. FITZGERALD: Maybe you should involve the stakeholders too, Minister. Because I remember making a phone call in Clarenville one day to a former employee of the forestry department - I do not think he is there anymore - and I asked him what he was doing. He said: I have myself locked in a room putting together a policy for the Bonavista Peninsula. That told me volumes. My comments to him were: Boy, you should not lock yourself in a room. You should go out and talk to the people out there. I think that is what should be done, and that's the reason why we get ourselves into trouble sometimes, when we go and implement things that we only see ourselves and we do not include the stakeholders.

MR. STANLEY: Just a brief comment. We have now adopted the most extensive consultation process, I would say, of any department in government, in moving forward with our planning.

We have a stakeholder committee in Bonavista, unit two, that has between thirty and forty people on it. They represent every part of your riding and every interest in the riding: commercial, domestic, the environmentalist, they are all there. That is the process we are following in developing management plans. It is very time consuming, and as you will appreciate, trying to get consensus out of thirty-odd people on anything is never easy, especially when your interests are as diverse as it is for that area.

One-third of the harvest on the Bonavista Peninsula is for domestic purposes, so it is not a small issue. It is a lot of wood. You know the sawmillers who are looking for wood down there. It is an issue we have to try and balance, but certainly our policy which has been followed for the last four or five years is very extensive involvement by local people as we develop these five year management plans for the area. I think when you get the presentation that the minister referred to on what is happening now and what will be happening on the Bonavista Peninsula you will see that that is the case.

MR. FITZGERALD: Thank you.

MR. K. AYLWARD: (Inaudible) when you hear some people say: We are managing the forest in a way that there is little or no heed paid to other views, well, that is not the case. These days we have to submit plans to the Department of Environment and Lands for harvesting, and it is a very much changed style of management. It is one that, even though it takes a lot of extra time, the people welcome it. Once you go forward, at least you go forward with a plan that is much more acceptable. We have had a number of examples where we went into an area and companies were going in and they were potentially going to harvest an area. There was concern about how close to a river they were going to come and this kind of thing. With good consultation, being able to work out the proper arrangements, it has saved a lot of aggravation, instead of having a situation occur and then have to go fix it after. It is working well, and we will take your views into account, sir, when we go forward.

CHAIR: Thank you, Mr. Minister. Now I invite Anna Thistle to ask closing questions. Before I do, I just wanted to say how pleased I am to have Ms Thistle and the minister here. It is not often you get a chance to participate in something very progressive, as they have done this year, in terms of those who are disabled to achieve big game license. I just want to take a moment to commend both of them on behalf of the Committee, because I think it is a very progressive social change you are enacting.

AN HON. MEMBER: (Inaudible).

CHAIR: All that is progressive is not necessarily Conservative.

MR. FITZGERALD: All that is Conservative is not necessarily progressive.

MS THISTLE: Minister, I was just noticing how broad-ranging your portfolio is. Almost every activity within your department takes place in the great district of Grand Falls-Buchans.

I think this is the first time I have seen all your officials congregated in the one spot. I would like to take this opportunity to thank you and your officials for all the work that you put forward into making that significant historical day, April 7, happen, when disabled people in this Province would have the right to apply for an individual big game hunting license just like everyone else, and also for the work that is going to be entailed and actually implementing that amendment that was brought forward that day. I sincerely thank you, and since I have been out in my district and all around the Province it has been entirely positive. It is a piece of history that we all here in this House were part of, and I thank you very much on behalf of the people of this Province.

I was thinking also, when my colleague the Member for Bonavista South mentioned how one of his constituent's family were featured in this book on the economy, how lucky you are. Because I know how forestry is so important, and it is such a significant contributor to the economy of this Province. Fishing and mining and forestry. I would ask that probably next year you may try to find a photograph suitable to capture the importance of forestry, particularly as it pertains to the heartland of forestry in the Province, which is the District of Grand Falls-Buchans.

MR. K. AYLWARD: The great District of Grand Falls-Buchans.

MS THISTLE: The great District of Grand Falls-Buchans.

MR. K. AYLWARD: The historic District of Grand Falls-Buchans.

MS THISTLE: Absolutely.

MR. K. AYLWARD: The history of pulp and paper in the Province that comes from that district is something we are all proud of.

MS THISTLE: Also, we were designated as the forestry capital of Canada in 1988.

MR. K. AYLWARD: That is right, and your pulp and paper mill now is doing extremely well and it is a very modern mill. It is an older mill but it has been modernized and its efficiency is very good, and your people there are working very hard to keep it there. I know you are going to invite us all this summer over to see the ERMA project on the Exploits River where you have the salmon enhancement project. If anybody has not seen it - I know you are going to invite them -, they should go see it. It is one of the best projects in North America when it comes to salmon enhancement. It is right across from the pulp and paper mill. You can throw a rock at the pulp and paper mill from over on the other side.

We have thousands of salmon now going through that river. We also have kids around. You can see them, they are loving it. There are thousands of kids a year going through that. It is a secret, but it is becoming well known. I just want to say to your people there that they have done a great job. The pulp and paper mill was involved a bit there in helping out. It is an example of the good things that are going on, the cleaning up of things that we did not do years ago. That is an excellent project where you can see the salmon existing and the pulp and paper company existing. There has been about $45 million spent on environmental matters in the last three or four years, where they have cleaned up their outflow into the river, and that has made the river much more healthier. It is a great example of sustainable development and commitment by everybody involved. Your people deserve a lot of credit.

MS THISTLE: I would have to say that that is a good example where industry and a natural resource can work hand in hand. This year with our sewerage treatment facility in operation the Exploits River will be returned back to one of the best salmon fishing rivers in North America. Yes, I invite everybody to come out and see our project, it is well worth seeing. In fact, we have been modelled after. Many parts of the world have sought our expertise in what we have been able to do, and it has all been made possible through various government levels of funding, and local people who have volunteered.

The twenty year forest plan is a concern that has been looming lately. I would like to ask the minister what the plans are for silviculture in Central Newfoundland, and how much funding has been designated for that purpose, and where will it be taking place?

MR. K. AYLWARD: Thank you for the question. We will be announcing the details of that program in the next couple of weeks. There is a commitment of I think we are upwards of about $12 million to $15 million this year again, which is similar to last year's program. We had projects in eighty different communities. In Central, where the agreement we have with the companies is that they will do so much and we will doing so much, they are giving their list to us today - or yesterday - as to the silviculture work they will be doing. What we will be doing is providing that to you, where they are going to be doing their work and our department will be doing its work. We will be letting you know that very shortly. We will be doing pretty extensive work in Central Newfoundland, as we have in the past few years. We should have the details soon as they are just about finalized, and we will be letting the members know very shortly.

MS THISTLE: Thank you. There is only one other question I would like to ask you, and that too concerns our moose population. I have been receiving a few telephone calls regarding the extension to the moose hunting season. Proposed, I should say, proposed, that is the key word. I know that will work out quite well in northern and remote areas because of the inability to get to those places prior to Christmas and so on. However, are you going to be looking for Province-wide response on that proposal, Mr. Minister?

MR. K. AYLWARD: We have had a couple of our biologists doing some responses to inquires. We have had a few inquiries on it, mostly from two or three areas. Probably two areas.

In Baie Verte and east of Gander we went to January 9 from January 3. Six days, I think it was. There was a February hunt on the Northern Peninsula in two areas and we moved that back into January, so we reduced that down. On the West Coast we extended to January 9 so we would have, Province-wide, the same hunting season. That was part of what we did. The hunting season on the West Coast was to December 13. It was about a two and a half week extension.

We have had some concerns from a few people. We have asked our biologists to respond and talk to the individuals, and even go see them, and explain the rationale. The recommendation for this year was to try to go with a little longer season, one of the reasons being that a lot of the animals were being taken within a kilometre of roadways. Back further they are not being taken. That was one of the rationales. There is a number of others, but that was one of the main ones.

We are taking responses to that, and like I say, we are sending officials to different places where we get substantial inquires about it. The Northern Peninsula has been responding, especially, in the northern part of that peninsula, very well to it. It is a six day extension for the East Coast and Baie Verte, and probably two and a half weeks on the West Coast. It is the one season now across the Province.

Again, like I said, I'm talking to a variety of people, and our officials are as well. I have asked them to take their views over the next few weeks to see what kind of views we are getting. We are looking at trying this for a year and then reassessing again. We appreciate the concerns you are expressing on that, and if you have any further concerns from your people, let us know.

MS THISTLE: The main area of concern is Sandy Badger, where you do get a lot of people travelling in that area, particularly families and so on during Christmas. I would be pleased to meet with your officials to see if we can look at probably a meeting, particularly about that area.

MR. K. AYLWARD: Sure.

MS THISTLE: That is it. Thank you very much.

MR. K. AYLWARD: Thank you.

CHAIR: Mr. Osborne.

MR. T. OSBORNE: Thank you. Section 3.1.02, Conservation Services, Revenue-Provincial, $25,000. Can you explain what that revenue will be used for?

MR. K. AYLWARD: We are looking at selling some advertising in the hunting guide that we put out annually. Right now we just publish that at cost to the government. We are looking at offering the opportunity to have some advertisement in the hunting guide. That would be some revenue to help defray the cost of publishing the hunting guide. The hunting guide is a publication for all the hunters of the Province. Some advertisers have expressed an interest in asking about advertising in it. We are considering doing that, so we expect to get some revenue for that.

MR. T. OSBORNE: Section 3.1.07, Salmonid Enhancement, under Revenue-Federal, there was a decrease there of over $100,000 last year from what the budget expected and the revised amount, and this year there is nothing. I am just wondering if you can explain that.

MR. K. AYLWARD: I will ask the Assistant Deputy Minister for inland fisheries to give some thoughts on that. We had a federal-provincial agreement and it has run out.

DR. NAZIR: We had a federal-provincial cost-shared agreement called CASEC which expired a couple of years ago, and last year there was some funding left from that. This was the belated revenue. Since the agreement expired and there is no cost-shared agreement this year, we are working on proposing one. As the minister mentioned earlier, we will be meeting with the federal minister soon. In reality, at this time, we do not have a cost-shared agreement. For budgeting purposes we could not budget any cost-shared funds until we have a new agreement. That is why that amount was taken out.

MR. T. OSBORNE: Under Production and Marketing, 4.2.02, Production Subsidies, last year there was $2,025,000 budgeted and the revised amount was $773,700. Again, this year there is nothing under .10, Grants and Subsidies. I was just wondering why the drastic reduction in the budgeted amount and what was actually given in grants. Could you give maybe a brief explanation of where those grants were given?

MR. K. AYLWARD: That is the divestiture of Newfoundland Farm Products, so the sale of Farm Products to the farming group, the chicken producers. That subsidy is now not being shown because we have basically, as part of the deal, provided them with some assistance to start off. They are now, as you are aware, out constructing their facility and are now a private company to stay in the marketplace and to hopefully be successful. We hope they will be.

MR. T. OSBORNE: This here is for chicken producers. I noticed later -

MR. STANLEY: I can explain. The money that went to the chicken industry was in two parts. There was one amount of money that went to run Newfoundland Farm Products, which is the building down in Pleasantville and the processing facility. The second amount was a production subsidy or assistance that went directly to the farmers.

The group that got together to buy Newfoundland Farm Products was essentially the chicken farmers. When we negotiated with them, the deal that we had involved the end of both the subsidy at Newfoundland Farm Products down here and the subsidy that went directly to the farmers. In exchange for both of those amounts of money there was an agreement negotiated with the company. They were given a certain amount of grant and a certain amount of loan, and that made it possible for them to take it all over. As a result, there will be no broiler producers in the Province receiving a production subsidy from the Province.

MR. T. OSBORNE: (Inaudible) the competitiveness of the chicken producers here with the chicken producers, say, in other Atlantic Provinces?

MR. STANLEY: I guess the judgement that was made by the chicken producers when we negotiated this agreement was that the assistance that the government provided them up front to get into this business - through the assistance, both capital and loan guarantee funding -, with that they felt they could operate competitively in the marketplace. They are confident of that. They invested their own money towards that end, and we are confident they are going to succeed. We are confident they can be competitive based on a deal that we negotiated with them.

MR. T. OSBORNE: I notice later on in the budget document for this department there was an amount budgeted this year of $500,000 for Newfoundland Farm Products. What was that amount for?

MR. STANLEY: I can explain that too. It is in two amounts. Essentially there is $300,000 in there to clue up the old Farm Products business. As you will appreciate, there were a lot of outstanding bills to be paid, accounts to be received, etc., as a result of the old Farm Products which government owned. This was an amount of money to clue that up. In addition to that, of course the facility at Corner Brook is still owned by Farm Products. It did not go to the new company. That money is there for maintenance of that facility in Corner Brook, and hopefully to assist in promotional efforts, etc., to try to identify an alternate use for the facility. That is what the $500,000 is there for.

MR. T. OSBORNE: I guess that facility will be maintained by the Department of Government Services.

MR. STANLEY: At the moment the Corporation, the Newfoundland Farm Products Corporation, which still exists and still has a board, is involved with maintaining the facility in Corner Brook.

CHAIR: Mr. Barrett.

MR. BARRETT: Chairperson, I just have fifteen or twenty questions. I should be brief. Sitting next to Harvey here I become inspired.

I noticed under 4.2.02, Production Subsidies, that last year it was budgeted for $2,025,000 and you spent $773,700. This year there is nothing budgeted. Is that because of the good policy of this government in the fact that you have disposed of Newfoundland Farm Products, and that you are building this great big place just on the outskirts of St. John's, the chicken producing out by Corcoran Pond? Does that mean that in the future there will be no subsidies to chicken producers?

MR. K. AYLWARD: 4.2.02 and 4.4.01 are both references for that and yes, basically there is no more subsidy. They are going forward on their own with what has been advanced to them. They are now a private sector company.

MR. BARRETT: I noticed 4.4.01, Operations, under Newfoundland Farm Products. Last year the $11 million I guess was part of that total agreement. Normally there was a $2,046,400 subsidy. Why would we have $500,000 for Newfoundland Farm Products this year? Is that to phase out the crowd that is out there or what?

MR. STANLEY: I just explained briefly. The $500,000 is in two amounts. Essentially there is $300,000 -

SOME HON. MEMBERS: (Inaudible).

MR. BARRETT: I must have missed a question from somebody else, did I?

MR. STANLEY: I can do it for you quickly if you want, no problem.

MR. BARRETT: Give me a quick overview.

MR. STANLEY: Essentially the $500,000 has $300,000 to clue up Farm Products in terms of the outstanding accounts and issues that remain from the old company. The other $200,000 is related to the facility in Corner Brook to maintain it, because that still belongs to government - it was not sold to the new company -, and to assist with some money to look for alternate uses.

MR. BARRETT: The other is a comment. I want to compliment the minister on such great work last year in being able to secure extra funding under the silviculture program and the great projects that were carried out in my district in terms of the forest enhancement and the silviculture programs. Not only that, it provided a great service and a great deal of jobs in that area. Most people say in my district that there is not enough wood for a woodpecker to get a lunch, but that is not true. There is a fair amount of forest in the area. It provided worthwhile projects that provided a lot of employment for a lot of people. We have anticipated that the minister will use his strong arm in Cabinet again this year. He will probably get some extra funds that he can put into this worthwhile program again. I am sure that this great minister will be able to accomplish that.

I also would like to compliment him in terms of providing some funding to Piper's Hole Salmon Enhancement Project last year, and the great work that was carried on there, and the great contribution that was made to the local economy by this department. I would like to compliment the minister on these couple of programs. That is all I have to offer to the debate at this time.

MR. K. AYLWARD: (Inaudible) for the district, the parliamentary assistant to the Premier, a very important role that he plays in the government, and the future roles he will play in the government. He is a very hard working member, and these projects would not have been achieved except for his good work. I am going to send a few copies of this out to his district when I get it from Hansard, as a matter of fact, after I said that, so we can help the member. He has done a good job and I appreciate it. The silviculture work is good work and it is a really good job creation work too.

CHAIR: Thank you, Minister. I am sure that the Member for Bellevue will quickly grab the first copy of Hansard to read the exemplary comments to the terrific questions from Mr. Osborne earlier, in that he missed some of the details. I am sure he will want to insure that he is fully informed.

MR. SHELLEY: (Inaudible).

CHAIR: Do you have a question? Go ahead.

MR. SHELLEY: First of all, I remind the Member for Bellevue there was a fellow by the name of Danny one time who (inaudible) his toes cut off. We can get on to that later, maybe.

Instead of going on through a bunch of other questions, I will put it together from the first page, from your fiscal year, the funding summary of gross expenditures. If it is satisfactory then we will not ask the other ones. We will try to make it an early night. I don't have a lot more.

Minister, it jumps out at you. There is $1 million more in expenditures for Executive and Support Services from last year, but there is a decrease in the other three: Forest Management by a small amount, by about 3 per cent; then Wildlife, and Agrifoods Development. There are decreases in that area but there is an increase in Executive and Support Services by almost $1 million. Just overall, instead of going through each heading with each one, what is the move towards Executive and Support Services, an increase there while you decrease Forest Management and so on?

SOME HON. MEMBERS: (Inaudible).

MR. SHELLEY: (Inaudible) approximately. Pretty close to that.

MR. STANLEY: Probably I could just make a comment. Most of that money came from the consolidation. We operate the administration function for three departments: Fisheries and Aquaculture, ourselves, and Mines and Energy. A lot of the money that is in there, I am advised, is related to the consolidation of the IT function in those other departments. It is all in one place. There has been no change in the executive expenditure in our department as such. It is where there is a consolidation between the three departments. There used to be three administration sections in the three departments and now there is one, and it happens to operate in our department. Those numbers get shown in our budget but the expenditures are also for the other two departments.

MR. SHELLEY: That is a reasonable answer to the $1 million increase in that, but there were decreases, some significant, in Wildlife, and Agrifoods Development. There was only a slight decrease in Forest Management, 2.5 per cent I think it works out to be. In the other two, Wildlife and Agrifoods Development, it is 21 per cent and 23 per cent decreases overall. Like I say, without going through all the headings, there were decreases in both of those. Where do you see the major part of the decrease coming from?

MR. K. AYLWARD: Agrifoods is Farm Products too, because the subsidy is gone, so that is a big chunk.

MR. SHELLEY: Yes, okay, (inaudible) -

MR. K. AYLWARD: That is almost all of it, actually. Wildlife, we are still doing -

DR. NAZIR: Almost $1 million moved to the operating from forestry because of the conservation officers moving to -

MR. SHELLEY: Say that again.

DR. NAZIR: All the conservation officers, wildlife officials, who used to be in Wildlife, now they are budgeted under a combined force under a different subhead, which is in fact on page 125, Section 2.1.02, Operations and Implementation. You will find there is an increase there. That is a transfer of wildlife officials from Wildlife into the -

MR. SHELLEY: (Inaudible) you know me to ask a bunch of questions, but I figured if I can get an overall statement on that it would suffice. I will end the questioning with that.

CHAIR: (Inaudible) questions? If not I would ask for a motion to approve headings 1.1.01 through 4.6.01 without amendment.

On motion, subheads 1.1.01 through 4.6.01, carried.

On motion, Department of Forest Resources and Agrifoods, total heads, carried.

CHAIR: The next meeting of the Resource Estimates Committee is on Monday, May 11, at 9:00 a.m., the Department of Tourism, Culture and Recreation in the Committee room.

MR. K. AYLWARD: Mr. Chairman, (inaudible) thank you very much for the experience tonight. We have a gift for you before you go. We have the Agrifoods Development Strategy 1997 documents. If any member would like to have it, we will give it to you free of charge, as Members of the House of Assembly.

CHAIR: Minister, thank you for your kindness. I wish to thank your officials too for spending their evening here. Thank you very much.

MR. K. AYLWARD: To the staff, thank you.