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

Pursuant to Standing Order 87, Roger Fitzgerald, MHA for Bonavista South substitutes for Robert French, MHA for Conception Bay South, and Gerald Smith, MHA for Port au Port substitutes for Yvonne Jones, MHA for Cartwright-L'Anse au Clair.

CHAIR (Reid): Order, please!

I want to introduce the estimates for the Department of Fisheries and Aquaculture. The meeting that we are supposed to have on Thursday at 5:00 p.m., is that alright with everyone?

AN HON. MEMBER: (Inaudible) 5:00 p.m. right after the House (inaudible).

CHAIR: Right after the House sits on Thursday we will do the estimates for the Department of Tourism, Culture and Recreation.

We are going to do the estimates for the Department of Fisheries and Aquaculture tonight. Just tell me if you have any problems with the procedure we have here. I think it is the one that has always been followed. We give the minister fifteen minutes to introduce his estimates, we give fifteen minutes to the person responding, and then ten minutes each. You can speak as long as you want after that and have as many ten minute sessions as you want. Is that alright with everybody?

We will call on the minister to give his fifteen minutes of introduction and when he is finished with that, or before, maybe he can introduce the staff he has with him.

MR. EFFORD: On my left is the Deputy Minister of Fisheries and Aquaculture, Leslie Dean. The Assistant Deputy Minister responsible for aquaculture is Gerry Ward, who is sitting on my right. Immediately behind me is Brett Wareham, responsible for fisheries development. The Executive Director is Mike Warren of the Department of Fisheries and Aquaculture.

Mr. Chairman, I do not know if I will take the fifteen minutes but I will take some time to make some comments about the Department of Fisheries and Aquaculture. I will begin with saying clearly it is my pleasure and our pleasure to present to the Committee the budget estimates of the Department of Fisheries and Aquaculture for the fiscal year 1999-2000.

This is my fourth presentation on behalf of the Department of Fisheries and Aquaculture. I think it has been a challenge but nevertheless a rewarding challenge. The accomplishments we have achieved over the past almost four years will be outlined in my preamble and hopefully come up in the questions and discussions for the rest of the evening.

The Department of Fisheries and Aquaculture has a responsibility for promoting ongoing developments in the harvesting, processing and marketing sectors of the fishing industry, and in particular, articulating policies relative to the management of fish resources. I think if there is any one issue that is of most importance today it is consultation and promoting the fisheries management resource to DFO. I think all of us look back on our past, regardless of our positions, but when we are talking about fisheries and aquaculture and fisheries development in the Province, I think if we are going to have a challenge and we are going to try to move forward, our biggest challenge is trying to work with the federal agency, DFO, and try to change and try to get the micro-management, I guess, somewhat diminished into allowing our fisheries development in the Province to move forward.

There are comprehensive programs relative to technical innovations, resource development, aquaculture development, productivity, and in particular quality enhancements. If there is any one thing that I am and we are most proud of over the last three-plus years it is the quality enhancement we have moved forward in provincial fisheries in the Province. Because prior to 1996, quality was the responsibility - we call it the QMP program - of the federal agency. I don't think anybody in the Province, anybody in the fishing industry, was satisfied with the quality program that was put forth by the federal government, and particularly the marketplace. I think if we are going to be satisfied with our quality initiatives we have to look to the marketplace. When the marketplace says: Yes, we are happy, we think the quality initiatives are to our satisfaction, then we say: We are moving forward. If that does not happen then we all have to take a look at where we are going.

In 1996 the provincial Department of Fisheries and Aquaculture took a major step forward. We made some major changes to quality handling of the fisheries' harvesting-processing sector. We looked at it simply this way. From the time a species of fish comes out of the ocean until it reaches the marketplace we must handle that product as if we are going to eat it ourselves. I think we began from that concept and we moved forward. The results that we have gotten back from the marketplace, as recently as the Boston Seafood Show, have been very positive. The result is that our department, and the inspectors and the quality assurance program has been moved ahead as to - what I call a considerable success.

As recently as last Friday I spoke in Toronto to a convention from a council of representatives of the UFCW, United Food and Commercial Workers from across Canada. For some strange reason, a lot of people in this Province and a lot of people across Canada still think today there is not a lot of fishing activity in the Province. Let me quote you a few numbers. The industry in 1998 employed 27,000 individuals: 14,000 in the fishing industry, 13,000 in the processing. An additional 7,600 individuals are employed indirectly in service support and related industries. That has nothing to do with the spinoff factor, the one if you relate it to direct jobs and how (inaudible) into the spinoff factor you multiply by 1.5. Those are direct and indirect jobs related to the fishing industry.

As work in the industry is often seasonal, comparative employment data with other industries must be expressed on the basis of full-time equivalent employment. Accordingly, the industry provided 16,700 person years of direct employment: 10,500 in fishing and 6,200 in processing. Some 5,100 person years of employment were generated indirectly. The fishing and processing industry provided 11 per cent of total provincial employment in 1998 and 35 per cent of employment in goods producing industries.

Fisheries development is a core activity of my department. Initiatives are directed towards identification and assessment of underutilized species and new resource opportunities that hold commercial potential and help diversify the resource base of the industry.

That paragraph there, even though it is short, says what we should have been doing years ago and what we must do today and must do a lot more of in the future. Our history shows that we place too much dependency on too few species. When the groundfish industry collapsed we found we had major problems. We must never allow that to happen again. We have to look to whatever possibility of resource development, or the species in the marine life in the ocean, and look at the value and how it can be commercialized.

An example of that is very clear. In the country of Japan they consume, on average, 450 different species of marine life. The maximum species that we develop today, we harvest today, in this Province is forty. We do not know that we have 450 but we certainly know there is more marine resource available in that ocean than forty species. We have to look at and we have to do more on research and development. We have to have a vision and we have to explore whatever opportunities exist.

If you look at one alone - and today I'm still trying to promote it, I'm still trying to get private industry involved - it is seaweed. We have not even begun to tap our seaweed resource. Nova Scotia produces $25 million worth a year. China produces $1 billion worth a year. You go into any Asian country and look at the marketability of seaweed for food, medical, and research. Roger Organ, down in Ramea, for argument's sake, is developing seaweed. Where is he selling a lot of? Down to the thoroughbred racehorses in Kentucky.

We have to look at all opportunities and we have to look at where we can develop other opportunities and never again allow ourselves to be dependent upon a few species: again, codfish in the past, and today most of our dependency is on shellfish. We all know the state of the codfish industry along the northeast coast. There is a bright light in 3PS. In 1998, the TAC was 20,000 tonnes. That is expected to be increased in 1999. I do not think it is out there yet. It will be announced soon, and there should be a substantial increase in that according to the scientific information that is being put forward, but we will wait and see over the next few days what it is going to be.

The total allowable catch for a limit in 4RS and 3PN fishery has not yet be announced for 1999. As well, the existing turbot and redfish fisheries and the limited reopening 3LNO yellowtail flounder fishery will provide a modest increase to the overall groundfish landings. Groundfish landings increased by 14,000 tonnes in 1998 to 52,600 tonnes with a landed value of $58 million.

While recovery of the groundfish stocks is taking place, shellfish resource will carry the fishery into the new millennium. I have concerns about that, and I think the Auditor General pointed that out recently to the federal minister. Because if all of the pressures that are being applied today continue in the next number of years on the shellfish stock, we all have to stop and take a look at where that is going to be four or five years down the road.

I guess that is one of the reasons why we have been placing so much energy in the all party committee that went to Ottawa to place pressure on the Minister of Fisheries and Oceans to look at conservation in the groundfish stocks and apply conservation right across the board to ensure that an appropriate management plan is put in place, that the groundfish stocks will recover, in particular cod, and will ease off the pressure from the small boats and a lot of fishermen that are now demanding a living from that shellfish species.

Not only is it a major part of the world food chain, not only is it a major part of the economy, but it is a protection for all species. Because if you apply too much pressure on any one species then we will repeat our history and you know what is going to happen.

The snow crab fishery continues to be of particular importance to the industry. In 1999-2000, the quota is 61,185 tonnes of snow crab. That is another reason why I am saying we have to be careful about the amount of pressure we are putting on the species. While it is good today - the harvesting that already started two weeks ago shows a good stock out there - we have to ensure that it is good not only for 1999-2000 but for many more years to come. We have to make sure that conservation measures are applied.

Now, to the northern shrimp fishery. Remember, two years ago we did not have an inshore northern shrimp. Today the quota available to inshore effort has increased from 29,800 tonnes in 1998 to 41,000 tonnes in 1999 in shrimp fishing area 6. The biomass of northern shrimp in that area is estimated at 475,000 tonnes and we will fish this resource to an exploitation rate of 12 per cent. Clearly the level of effort is well within the bounds of a conservation harvest, but we have to make sure again that this is not short-term but long-term. As much as the industry people have spoken about it, while the biomass is large, the amount of harvesting for conservation (inaudible) but for marketing conditions. Because if you take the quota and you put that up to 150,000 tonnes to 200,000 tonnes out there, you know what is going to happen in the marketplace. You have to weigh all of the possible consequences and make sure the judgements you make are protecting the industry, the viability and the amount of money that you can derive from the industry today, not only today but for the long-term.

Shellfish with a dockside value of $295 million in 1998 represents 80 per cent of the landed value of commercial sea fish. Of these fisheries, both crab and shrimp each provide an income in excess of $100 million in the Newfoundland and Labrador fishing effort, with offshore clam and lobster providing $25 million and $24 million respectively. The Newfoundland offshore surf clam fishery had landed approximately 15,000 tonnes of shell stock annually in each of the past five years. The landed value in 1998 was $25 million. Similar (inaudible) in landed value has been forecasted for 1999.

Our sealing industry continues to be an important contributor to the overall fishery and the economy. Approximately 3,000 sealers and 300 plant workers received income and employment from the industry which had an export value of approximately $20 million in 1998.

I am not going to get into the details about the seal oil capsules and all the other things because we know that market is going to grow but the forces of the IFAW, their propaganda campaign... Last year, as Roger knows, when we were in Ottawa, they reported in their annual report that they raised $56 million U.S. That is about $80 million Canadian.

For us people here in Newfoundland and Labrador to fight that kind of a propaganda campaign is almost - absolutely impossible, not almost. It is impossible. They are going to continue, but unless the federal Minister of Fisheries and Oceans of Canada makes a decision in favour of the Newfoundland support, of not only the present sealing industry but the reduction in the seal quota, the number out there, then nothing will change. They will continue. They do not want to see the sealing industry stopped. They want to continue; because as long as it continues, as long as they print their glossy magazine pictures about all the falsehoods - about Newfoundlanders being barbarians and killing whitecoats, which we all know is not untrue - the money will keep flowing in. They do not want to see anything change.

The sealing industry must be a major part of development for the future of the people involved into it, but we have also have to recognize there is a major problem out there with an overpopulated seal herd. That is the reason why the Northeast Coast of Newfoundland and Labrador and the north areas of Newfoundland and Labrador are showing very little recovery in the codfish industry.

You have seen what has happened over the last several weeks with the videos of cod being corralled in the coves and millions of pounds being destroyed. I just heard in the last couple of days it happened again, I believe, in Lethbridge, down around that area, where cod came in and people just hoarded them off the beach and took them away, and DFO just turned their back on them and let it happen.

Aquaculture has been a challenge since day one in the Province, and not only in the Province but it has been a challenge worldwide. It has been a very high risk industry. If we are going to move forward in the aquaculture industry, environmental conditions have to be right but I think private industry has to play a major role in the development of the aquaculture industry. We have made significant gains in this Province and we have made a decision now that we have put a loan program in place for the increase in the mussel aquaculture industry. I think it is moving forward in strides. I think over the next three to five years we are going to see major increases in the mussel industry.

The fin fish industry, as everybody knows in the Province, has undergone extreme circumstances over the last year, but we have made a decision as a government. What we have done with the fin fish industry in Bay d'Espoir is now final. If it is going to move forward, it has to move forward with the proper investment from the private sector in management and dollars.

The one thing we are happy about, I suppose, is that one of the things that held the aquaculture industry back in Bay d'Espoir was the restriction that was placed on the industry by the strains of fish that they were allowed - or not allowed - to bring, or the strains of fish they were bringing. That was certainly a major impediment about making a profit and moving forward.

We have convinced Ottawa, with the appropriate criteria put in place to predict the escapement of the diploids, they are now allowing us to bring in the female diploid steelhead trout. I think over the next three of four years that will certainly help the fin fish industry move forward. If all the management is in place, the female diploids will be a major component to having profitability in the aquaculture industry.

I firmly believe that the aquaculture effort's potential for employment for many rural areas in our Province and the development of this industry requires clear direction. We will certainly take a lead in working with them through research and development.

We have made many changes in the framework of the processing industry. I will just quickly go over two or three things and then I will conclude. When I came with the department in 1996, there were well in excess of 200 fish plants in the Province. They certainly were not operating, but there was a licensing ability for those plants to be operable.

We looked at the numbers of fish plants. We looked at the amount of resources available, and everybody in the industry recognized there were too many plants. You could not go out there and say you are not getting a licence, because you had to look at the number of years those plants existed, and the proponents. Some of the owners of those particular plants were families over a number of years and they had made significant investments. We thought it was unfair just to make a blanket policy to cancel your licence, so we put a policy in place that allowed the transfer of licences. We looked at a regional basis in the Province - based on a regional basis in the Province - where there were no fish plants and in my area - in particular the Avalon Peninsula - where there were fifty-seven plants. We knew there were too many out there, so we said we would allow a licence to transfer from one area of the Province where there were not enough in another area.

We looked at a core policy based on processing of 1,000 tons from 1987 to 1991. If somebody wanted to become core in an area of the Province where there were not enough core plants, they could buy one, two or three licences, transfer them, and make up that core licensing policy. That gave the ability to someone who wanted to become core to be able to avail of all the licences, be they multi-species operations, but it also gave the ability to somebody who had significant investment and was not going to be able to recover their investment a chance to get some of their investment back by selling their licences and allowing that owner to make up.

Apart from that, we looked at the transfer of licences and the making up of a core policy. We looked at, as I already touched upon, the quality initiatives. Then we looked at reducing the number of plants in the Province.

Another thing that we said was, if a licence was inactive for a two-year period we would cancel it or that licence would be taken off our books.

A review of the plant activity of 1997-1998 has identified thirty-three plants, including the 169 above, that were not active in either of those years. It is a policy of the department to remove any processing licences inactive for a two-year period.

Plant ownership operators have the right to appeal the non-renewal of a processing licence. In other words, in 1989, 215 primary processing licences were in place. If we cancel licences because they were inactive for a two-year period - and let us take an area of the Province where there is not a lot of activity in processing - they would come forth to the Province with a proposal, in other words an appeal, and we would give consideration. If it made sense that a particular area of the Province never had enough processing, and a need or a demand for processing, we would consider reactivating that licence. They would have to make a good business case for that licence.

In 1998, there were seven plants processing shrimp. In 1999, we expect two more. Well, we do not expect two more; we know one is going to be in Jackson's Arm and Black Duck Cove and St. Anthony, so there are going to be ten altogether. There is one being considered for Labrador. The Labrador Shrimp Company is talking about it. I do not know if they have made their final decision. They are talking about putting a shrimp plant down in Charlottetown, and Fogo Island Co Op have expressed an interest.

Apart from that, right now today, in 1999 there should be about ten plants operating. I am getting a bit concerned. We have talked about holding the line there. We are having consultation with FANL and with the industry and we will make a decision on that further along.

I thank you, Mr. Chairman, I recognize the time. The final comment I will make, being down to the Boston Seafood this year and looking at the export value of fish products out of the Province last year - $700 million - with the increase that is expected with the increase in crab, the increase in shrimp, and some increase in the cod stocks, cod quotas in 3Ps, we expect to go over $800 million in 1999.

The good point that I want to make is that the response from the marketplace with our quality control initiatives, with resource development, diversification, we are getting an excellent response from the marketplace. I am looking forward - and we are all looking forward - to the fishing industry of the future providing a substantial income and being the backbone of the economy of the Province in rural Newfoundland and Labrador.

Thank you, Mr. Chairman.

CHAIR: Thank you, Minister.

Before we go on, to get the Clerk to read the headings, I would like for the Committee to read their names into the record. We can start with Mr. Collins down here on the end.

MR. COLLINS: Randy Collins, MHA for Labrador West.

MR. SWEENEY: George Sweeney, MHA for Carbonear-Harbour Grace.

MR. HUNTER: Ray Hunter, MHA for Windsor-Springdale.

MR. RIDEOUT: Tom Rideout, MHA for Lewisporte.

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

MR. PARSONS: Kelvin Parsons, MHA for Burgeo & LaPoile.

MR. SMITH: Gerald Smith, MHA for Port au Port.

MR. JOYCE: Eddie Joyce, MHA for Bay of Islands.

MR. REID (Chair): Gerry Reid, MHA for Twillingate & Fogo.

Minister, your officials should name themselves when they speak, for the Hansard.

We will go to you, Mr. Rideout. Before we do that, Elizabeth has to call this one.

MS MURPHY: 1.1.01.

CHAIR: 1.1.01.

I guess it is you, is it?

AN HON. MEMBER: (Inaudible).

CHAIR: It doesn't matter.

The hon. the Member for Bonavista South.

MR. FITZGERALD: Thank you, Mr. Chairman.

Minister, listening to your report, in your preamble at the opening of the meeting, you are 100 per cent right, and it is a job for anybody to disagree with you, what the fishery is worth here in this Province today. I can see it firsthand in my own district when you look at fish plants like Port Union, Bonavista, and Charleston, right in that little area, right in that peninsula, within thirty miles of each other.

Back prior to 1992 we had a fish plant in Charleston that was doing in excess of 600,000 pounds of fish in twenty-four hours, 300,000 pounds of fish in one shift. Then you go over to Bonavista where you had in excess of 500 people employed - 1,300 in Port Union, 500 in Bonavista, and another 300 in Charleston. In a little area - I think my district has a population of something like 14,000 people - you probably had well in excess of 3,500 people directly involved in the fishery.

You are right, the fishery is probably worth more today in export value than it was back in the 1980s, but the problem we are facing, as you know, is that the numbers are not there and I do not know if they will ever be there. They probably will not when it comes to people being employed.

In Port Union right now they have a new, modern, state-of-the-art shrimp processing plant. Where once there were 1,300 people employed, now 135 people find a job there for fifteen to sixteen weeks a year.

Sometimes I think about what is happening in the capacity that we are bringing forward there, and I fear it might end up like what is happening in our crab processing industry. I totally disagree with your decision to expand the number of crab processing plants -

WITNESS: You do?

MR. FITZGERALD: Yes, I do.

- that you put around the Province. You certainly did not put them in the locations that you were talking about. In some areas you see as many as three or four crab processing plants within fifteen minutes of each other.

MR. EFFORD: (Inaudible).

MR. FITZGERALD: Down on the Southern Shore, I say to the minister. He knows very well where they are. I do not think they are strategically located. I do not know what criteria the minister used when he was putting the crab plant processing capacity forward, but it was certainly not the right thing to do as far as I am concerned.

I think in most cases all we did was transfer jobs from one area to another. You can see that right in my particular area now where you have FPI almost playing one plant off against the other. I think that is wrong, now that they have the one up in Triton. I think it is wrong for them to use one against the other in that kind of way, I say to the minister. It is something that the unions will probably be dealing with as well.

Quality - there is no doubt we have come a long way with quality. I worked in the fishing industry myself. I worked in a fish plant for thirteen years. I remember going to work there first and we would not think about eating something that was processed in that plant. You would go out to the store and buy fish, but you would never bring home fish that came from the plant where you worked.

Today the attitude is completely different, and it has been different for quite some time. Some of it is because of the efforts that you have put forward and the quality control measures that you have insisted we must obtain. I think that is reflected, too, in the price that we get today.

Now it seems to be a situation - we see this in our crab processing industry. I think it started off with a $1.30-something. Now I am hearing rumours that it is up to close to $1.70 that some processors are paying. I know the marketplace drives it, but I think quality has a lot to do with it as well.

The seals - I thought the minister was going to forget the seals there for awhile. He only included it in one of the last paragraphs. I was shocked. I thought he had forgotten all about it.

MR. EFFORD: (Inaudible).

MR. FITZGERALD: I do not think we have given it the attention, as a government, that we should have given it. I think there is still a lot that needs to be done there, Minister. While you are right, something has to be done with the herd, and I totally agree with you - whatever the word is that we use to reduce the herd is not important, but something has to be done - I think it is important that your government as well now put particular emphasis on developing markets for the animal, especially the skins and furs and this sort of thing.

The plant down in my district again, in Catalina - the seal plant there which started up just the year before last - last year bought in excess of 150,000 pelts, if I recall correctly. That is out of a total of 275,000 that you were allowed to kill at that time. This year, in talking with some people there, I understand they have only bought less than 50,000 pelts so far this year.

I am wondering what is happening there. It is obviously a situation where either the markets have not been developed where they have been able to sell their product - I understand they have a lot of product there in inventory that has not been sold. It is something new and maybe it is bad quality, as the minister says, but this is a new industry. This is just as new as the fin fish industry, I say to the minister. It is just as new as some of the aquaculture industries, but it seems like we are leaving this particular industry to the private sector whereas in other parts of the industry we seem ready to jump in there and provide funding for it but we are not doing it with the sealing industry. I think maybe that is something that needs to be done and needs to be done soon.

The minister maybe should even look at having an arm of his department look at trying to help the private sector along and develop industries and pursue markets in order to make this a viable, acceptable industry. I think it can provide many opportunities and I am sure that it will allow our fishermen to be able to get back in their boats much quicker than any of us can even hope for.

When we look at what is happening in the codfish industry in the Province, and we look at the positive news on 3Ps and the not-so-positive news that we hear from 2J+3Kl, I say to the minister - and I do not know what influence you have up in Ottawa and I do not know if you are consulted when it comes to setting quotas for the harvesting of cod - when you hear people talking about the lack of codfish north of White Bay... Even back in the 1980s there was very little codfish north of White Bay. When I talk about the 800,000 pounds of fish that was processed at the FPI plant in one twenty-four hour shift, the bulk of that fish, if you talk to the people on the draggers and the people who were directly involved in the harvesting part of it, they will tell you that most of that fish was caught in 3L or 3K. It certainly did not come from 2J. We should not be alarmed about that.

I think Mr. Winters, a person in whom I have a lot of faith, who has been doing some work for your department and for the union as well, has put forward a suggestion that maybe we could realize 25,000 to 30,000 metric tonnes of cod fishery in area 2J+3Kl this year. The minister shakes his head. I do not know if he shaking his head because he does not agree with the numbers or if the numbers I am quoting are wrong.

Mr. Chairman, I think he also put forward a suggestion that maybe the cod in 3Ps could support a catch of something like 70,000 metric tonnes, if I recall reading it correctly in the report that he provided down in Clarenville to the FRCC.

The minister spoke about the Auditor General's Report. I say to the minister: Do not get caught up in that. Do not get caught up in the Auditor General's Report. While he may have some fear that we are proceeding maybe a little bit too fast in the shellfish industry, something has to be done in the meantime to sustain our communities. You might say that is regressive thinking and we should take a lesson from what we have done and what will happen to our cod fishery; but, I say to the minister, if you listen to the real scientists out there, if you listen to the fishermen, they will tell you what they are seeing and what they are finding.

When you look at the situation where we only harvest the male crab and everything less than I think it is ninety-five millimetres of body size is thrown back - we do not harvest any female crab - I think the mesh size in the traps are large enough that most of the smaller crab escape anyway. I think it is completely different than what we did with our codfish industry where all we did was size the gear that we were fishing in order to get more and more and make up for the smaller size fish that was there.

The minister talks about seaweed. He has been talking about seaweed and underutilized species now for the three years that he has been in the department. While it offers some opportunity, maybe a lot of opportunity - and God knows we can use it in rural Newfoundland and Labrador - it seems like people are hesitant to get involved. Here again, Minister, I think something has to be done in order to help people along.

AN HON. MEMBER: Why?

MR. FITZGERALD: That is the question I ask you, why? I don't know why but you obviously do know if you are promoting the industry and if you are talking to the people out there. Maybe we need some help to help them along.

When you look at some of the money that we have put into the aquaculture industry, I don't know if we have ever made a dollar in the aquaculture industry. I don't know - I ask the minister that - but when you look at some of the money we have put into places like S.C.B. Fisheries and the Belleoram Hatchery... When you look at the money that has gone into the Belleoram Hatchery where, up until last year I think there was probably well in excess of - to buy the plant there, the original cost was $500,000-and-something and it ended up costing just about $1 million before it was even turned into a hatchery. If I recall correctly, by looking at the Auditor General's Report, up until last year there was only $5,000 worth of product sold there.

AN HON. MEMBER: Go away with you.

MR. FITZGERALD: Don't go away with me. They are the Auditor General's figures, not mine, if you want to dispute them. If that is true, then what is happening? Are we going after a dream that we would like to see happen and not being realistic? Or, if there is potential there, then why aren't we turning it into at least allowing those industries to be self-sustaining and look after themselves?

While there are many opportunities there, there are a lot of opportunities that are not going to be there for a lot of people. Your district, Mr. Chairman, like mine, depends on the fishing industry; and if our rural communities are going to survive then I do not think we should be one bit shy in maintaining the quotas that we put have forward for the shellfish industry and allowing at least that particular activity to happen while we are waiting for other species to return, and allow fishermen and fish plant workers to make a living in the processing sector.

These are my only remarks but maybe, if you do not mind, I can ask a few questions. That way we can pass it on, or would you rather for me to let the flow go?

CHAIR: I am easy; you can start now if you want, if there is no problem with you. It is your (inaudible).

MR. FITZGERALD: Minister, maybe you might want to respond to a couple of things that I raised.

MR. EFFORD: (Inaudible). Is the hon. member saying that we should not put any money into research and development, and whatever we did in the past will continue on in the future?

MR. FITZGERALD: (Inaudible).

MR. EFFORD: Because that scallop hatchery in Belleoram is simply a research facility that was started and it was hoped that it would go into production where a private industry would take it over. In fact, as we are talking now today, there are discussions ongoing and will be ongoing with an interest. At the time that is turned over, hopefully some time in the future - but you have to invest in research and development. Otherwise you will become stagnant, and when you become stagnant you start to fall behind and nothing happens. I think, if you look back at our past, that is certainly a history that we had up until a couple of decades ago.

The Auditor General's Report - I am glad that the federal Auditor General pointed out exactly what he did; not saying that we have cause for alarm or cause today that there is a major problem in the shellfish industry, but we have to bring ourselves to attention every now and then because when we only look at how much money we can make today in harvesting or processing or in the industry, then that is a recipe for trouble in the future.

I said publicly that just the mere fact that the Auditor General cautioned us, brought it to our attention, gives us a reason to stop and think where we are going in the future. Yes, the shrimp stocks are good, and yes, the crab stocks are good - today. Let's not only look at today, let's look five to twenty years down the road. The fact is that he has brought it to our attention. The fact is that I hope all of us will have the good common sense to make sure that the measures we put in place and the quotas are based on the best possible science information available.

I will give you an example of what I'm really concerned about. Every boat involved in fishing in Newfoundland today wants to derive a living from the shellfish industry. That to me is a recipe for trouble. In Conception Bay this year there is a quota set, in the bay which I live, for somewhere in excess of 3 million pounds. I am telling you now - and I hope I'm proven wrong - that I do not think that crab is there, but if it is caught in 1999 it will not be there in the year 2000. That tells me there is trouble.

Those boats cannot go off fifty, sixty or seventy miles. That is the reason why I have been fighting so hard to try to get the darn seals reduced because if the seals are reduced the cod should have been back. Seven years after the moratorium no one in the small boats are looking to cod because they know the cod is not there, and they are going after the shellfish. That is the reason. I am not saying that the shellfish is in trouble today but I can tell you one thing: Don't ignore the warning that the Auditor General is putting in place.

I will speak on crab licences very quickly. When I became minister of the department, one of the major concerns around the Province was the cartel. I do not think anyone in this Province is going to say there was not a cartel. If they do, they are going to have one awful argument with me. You know what was happening to the fishermen and everybody in the industry. There were seven owners of seventeen licences. Today it is well distributed around the Province, and the quota in 1995 was somewhere around 28,000 to 30,000 tonnes. Today, it is 135 million pounds.

Are you saying that those seventeen licences should have that total quota of 135 million pounds? I think not. I do not think Triton is doing too bad, I do not think Bonavista is doing too bad. The three little plants up the Southern Shore together - the three of them, Charlie O'Brien, Martin O'Brien and Donnie Graham - together will not produce 5 million pounds out of the 135 million pounds, but they will employ a few people.

I think it is well distributed and well placed around the Province. So 135 million pounds of crab with the few licences out there - and we have held the line. We are not increasing any more now. In fact, four of the licences that were issued are not processing because of circumstances beyond their control. In Burgeo, for example, there are no crab there and they are looking for an offshore quota, and there are a couple of other areas around the Province. You have to understand the reasons why we did it: it was cartel controlled, and the amount of crab today compared to what it was pre-1996.

AN HON. MEMBER: (Inaudible).

MR. EFFORD: Most of it was in the 3L, you are right on that one.

The other one I want to make a quick comment about is the developing market for seals. We are continuing. We have put money in the seal market development for twelve years and we are still putting money in -

MR. FITZGERALD: Did you put money into looking for markets -

MR. EFFORD: Yes, that is where it has gone.

MR. FITZGERALD: - or did you put money into subsidizing the industry by paying fishermen to be able to go out and take an animal and subsidize the cost of it? There is a big difference.

MR. EFFORD: Seventy-five per cent of the funding went into market developing. Every pound of meat that came in is being subsidized by the provincial and federal governments. We went around the world. We have subsidized the people in the industry: the seal association, the seal development board, going into markets. The one thing you have to recognize is that unless we can do something with organizations like the IFAW there is not going to be a major leap overnight in changing the attitudes of developing markets. We are and we will continue to develop the seal markets.

You know and I know the present problem that we have with the overpopulated seal herd is not going to be resolved by increasing the market for seal products. That will gradually, over the next four or five years, continue. All you have to do is look at a company like Corrino. How many years?

AN HON. MEMBER: Thirty years.

MR. EFFORD: Thirty years they have been here. I mean, they are developing. They are marketing their products worldwide and they have a history in the Province. They did not have any problems last year with the seal products they bought. The new company like you are talking about, Atlantic Marine down in your area, was new in the industry. Some of the sealers did not bring in too much of a quality product. They bought it and they have a bit of a problem, but they have realized they have slow down like the company in Baie Verte. They were very careful about the new company this year, about how much they bought. I think they bought around 20,000 or 30,000. They want to make sure what they buy they will process and be able to market a good product. I think caution, concern, conservation are the things we have to look after for the future.

The final comment I want to make here (inaudible) 600,000 pounds was processed in a twenty-four hour period, for example, in Port Union. You are quite right, but remember where we had the days when all that processing was taking place in every plant in the Province. If we had been a bit more concerned about what was happening to the resource, probably Port Union may not have been processing 600,000 pounds, but it could have been processing 200,000 pounds or 300,000 pounds for the long-term.

We made a lot of mistakes. The only thing I hope is that we have the good common sense. Our shellfish is out there, the stocks are good. Let's not repeat the mistake in the shellfish industry. When I see every single boat in Newfoundland and Labrador today, and my own people, my own family members, going after that shellfish, that gives me a lot of concern, Mr. Chairman.

MR. FITZGERALD: As long as we do not become paranoid over the whole thing, Minister, because when I -

MR. EFFORD: Liberals are never like that, sir.

MR. FITZGERALD: When I read the Auditor General's report and he refers to the size of boats, it is totally unrelated. I do not know why DFO is involved in boat size anyway. Why would the Auditor General, or why would the Department of Fisheries and Oceans, be concerned about the size of boat that my enterprise can sustain, if I am not looking for any extra quota or any extra licence? Here again people have become paranoid that they are going to come back looking for extra quota and extra licences in order to maintain the size of boat they have.

The fishermen who I'm talking to are not looking for that, and make it quite clear. When you see fishermen today having to go and cut fourteen inches, or cut their boat in the middle to take two feet off it, in order to be allowed to go fishing, there is something wrong, I say to you, Minister. I do not know if you have brought that topic up with your federal counterpart.

MR. EFFORD: (Inaudible).

MR. FITZGERALD: You certainly have not gotten anywhere and the fishermen today are still facing the frustration.

MR. EFFORD: It is called micromanagement. It is a problem that we have all had to deal with in the past, the present and the future, in dealing with DFO. They believe the larger the boats the bigger the demand on the resource. I disagree with it. I am on record writing several letters to former ministers, the present minister, that we should not be interfering with the size of boats. It should be based on safety and comfort. Government, science, should set the quotas, and in particular today, with the I.Q. fishery, the individual quotas, there is absolutely no reason for any level of government to interfere.

MR. FITZGERALD: No reason.

MR. EFFORD: In fact, I even challenged the federal minister, David Anderson, in a meeting in Ottawa last week - I do not know Gerry if you were there; there was somebody with me - when I said: If you think I'm wrong about the safety factor on the boats that have to go out on the Grand Banks, come down with me. I do not have a lot of nerve for the ocean, but I will go out. Let's spend a week out over the 200-mile limit in a sixty-four foot boat. When we come back, you tell me if you would recommend not to build larger boats. He would not accept that challenge.

You are right. We should not, as governments, be interfering. It is a safety issue. I'm telling you, I'm fearful that it is a tragedy waiting to happen. I think we talked about that, Mr. Chairman, over supper this evening.

MR. FITZGERALD: It has already happened, I say to the minister.

WITNESS: (Inaudible) supper.

MR. EFFORD: Yes, with the Liberals.

MR. FITZGERALD: It is something that needs to be looked at.

Down in Belleoram again, with the hatchery there, you say that is going to be passed over to private industry, or there is somebody -

MR. EFFORD: That is the long-term plan.

MR. FITZGERALD: Because in the fisheries report or in the Auditor General's report, she had indicated that your department had made a statement, or had indicated that it would disperse the operation as of March 1999. March is here and gone and we still have it. I am wondering if there is a new owner or if we have somebody who might potentially want to take that over.

MR. EFFORD: (Inaudible) as of March 1999? The plan was this. From day one it was a research and development facility, and once it got up to commercial value it would be turned over to private enterprise. I was not sure that the date was set for March 1999.

MR. FITZGERALD: March 1998.

MR. EFFORD: March 1998?

MR. FITZGERALD: March 1999. Hang on a second now.

MR. EFFORD: We are now having discussions with an interested party. When the appropriate time comes - I tell you, we are not going to just jump out and throw it in the wind. We want to make sure that whatever company takes that over it will be a viable company and the operation will be viable for the long-term.

MR. FITZGERALD: March 1999 -

MR. EFFORD: Yes, 1999.

MR. FITZGERALD: - you indicated you were going to be passing it on to a private company and get out of the industry.

MR. EFFORD: I invited the Auditor General -

MR. FITZGERALD: Research and development are two good catchy words, Minister, but there comes a time the taxpayers of this Province are going to want to know where the end results are going to be. Research and development can only go on so long.

MR. WARD: The issue on Belleoram, specifically, was for a three year project, of course. The first two years had some very poor results. It is no question they were the result of very poor water conditions and so on down there. Last year was the first year in which we were successful in bringing it from the larval stage all the way up to the point of putting it in the ocean. This year we will have roughly 5 million spat which they can put out into the ocean which will be sold at, we hope, between three and three and a half cents. The cost of operating, as you indicated there, is up in the area of $200,000. We need another good year to see whether, from a research and development perspective, you can actually take scallops into an aquaculture position and have success.

The first two years were a disaster. Last year was very encouraging. The objective this year is to put out maybe 8 million to 10 million spat. We are seriously looking at ways of divesting this before the end of this coming fiscal year.

MR. EFFORD: I would make one final comment. If we did not put money into research and development we would still be back spreading fish on the beaches.

MR. FITZGERALD: I am not arguing with that. What I am saying is that there comes a time when research and development should give way to a company making a profit, or else your research and development should be able to tell you something. It is not feasible anymore.

Going back to those small grants that used to be provided, and I think still are in certain cases within your department -

MR. EFFORD: What grants?

MR. FITZGERALD: Three thousand dollars that a fishermen's committee could access to do a slipway or to do some repairs to their wharfs. It was money that was well spent in most areas. It would encourage people to show a little bit of initiative to provide the labour themselves. It was only meant for material and not labour.

MR. EFFORD: That is right.

MR. FITZGERALD: How much money do you have in that budget?

MR. EFFORD: Two hundred and fifty thousand dollars or two hundred and seventy-five thousand dollars?

WITNESS: Two hundred and fifty thousand dollars this year.

MR. EFFORD: Two hundred and fifty thousand dollars.

MR. FITZGERALD: Two hundred and fifty thousand dollars? It is only a matter of making application, I guess, and -

MR. EFFORD: I would not say that.

MR. FITZGERALD: - it should be brought forward.

MR. EFFORD: I would not go as far as to say that.

CHAIR: Are you finished?

MR. FITZGERALD: For now, yes.

CHAIR: We do not have to go in any particular order, but do you want to ask a few questions down there, Mr. Collins?

AN HON. MEMBER: (Inaudible).

CHAIR: Who else is ready to go? Mr. Hunter?

MR. HUNTER: (Inaudible) like to ask (inaudible) a couple of questions.

Mr. Minister, I am not too familiar with fishing and the sea, because I am an inland person, but from going around the district I've noticed in the Green Bay south area that there are a lot of mussel farms and harvesting in that area. From some conversations with people and fisherman out there, a lot of the mussels are being dumped because of the size in that area, and a lot of the problem stems from lack of processing facilities. I do not think there is a processing plant in Green Bay south for mussels. If there is not, would you support the idea of initiating some type of secondary processing in the Green Bay south area so that fishermen could bring their product to that market quicker and so that these mussels would not be dumped anymore in the future? Would you support an idea like that?

MR. EFFORD: I'm going to let my Assistant Deputy Minister answer the question. I want to make a couple of comments prior to that.

First of all, there is absolutely no reason for anybody to dump mussels. Can you imagine that we are growing mussels in 1999 and we are dumping mussels? First of all, we made a number of exceptions last year to the rule of allowing people who had a problem with selling their mussels to ship them out of the Province unprocessed into P.E.I. or wherever they could find markets. We made all kinds of exceptions. There is a number of processing facilities in the Province today. In fact, there is a value added secondary processing over in New Harbour. There is one out in Bay Roberts.

The problem that we have had is trying to bring the people in the industry together and to make sure they can get their mussels to market. In fact, there was a consortium formed last year. There was seventeen processors, a lot them from your area involved in that consortium. For some reason there are individuals who resist moving forward for their own particular reasons. I think most recently we have had another aquaculture meeting out in Gander and things are moving forward. I do not see that problem in the future. I'm going to tell you one thing, and I will say this unequivocally, that any farmer growing mussels in Newfoundland and Labrador to say that he or she dumped their mussels should be ashamed.

MR. HUNTER: Would you support the idea of processing and secondary processing in Green Bay south?

MR. EFFORD: We will not support having every farmer in Newfoundland and Labrador with a processing license. We are concerned about -

MR. HUNTER: I never asked you that question, Mr. Minister. I asked you the question: Would you support the idea of having a secondary processing plant in Green Bay south area?

MR. EFFORD: It is not an issue with secondary processing. Secondary? Yes!

MR. HUNTER: Or a processing plant plus a secondary processing plant?

MR. EFFORD: Gerry.

MR. WARD: There a number of issues here. Number one, we have come from 360 tonnes to 950 tonnes of mussel in total for Newfoundland. That is not enough to keep one small plant going on a year-round basis. The reality is that we have five primary processing plants today and we have two secondary processing plants. By the end of this year, now, we need about three times the amount of production to just keep these plants busy on an eight-hour shift.

The issue on small mussels is clearly a marketing issue. The analogy can be made very similar to the cod fishery in the Isle aux Morts and Port aux Basques area. You bring in a fish, it is very small, you can produce less than a two-ounce fillet on it. What do you do with it? You put it into a cod block and downgrade the market.

It is the same situation with mussels. The market in the United States calls particularly for 2.25 to 2.75 shell size. If you do not have that size, you either take a lower price or you have to decide to shuck it out and put it into meats and put it into a value added product. That is now being done, since last fall.

There were two requests that came in to the minister to allow them to ship product for processing outside of the Province. The department said: You have to prove it cannot be processed. Today, as a result, we do not have enough product to sell today. We do have the five primary processors and two secondary processors. With regards to Green Bay, there is a plant right down in your neck of the woods, Ed Sheppard specifically, and Island Treasures Mussel Processing Ltd.

MR. HUNTER: I think the mussels they were talking about were the oversized ones. They would not accept them out there. They had no choice other than to dump them.

MR. WARD: Those are getting through the system. I think that is more a function of a new fishery. Until you can match up the production with the market, you either have some small products and you have some large products. Part of it had to do with they were not using grading equipment to grade them properly, so therefore you had all ranges of shells when you went to market. By the time this year is out that will be through the system and new crops starting in 2000 will be within the range that you require to market. Those that are not will clearly go into secondary processing, shell on, meats, solids and so on. We have two very good secondary processors doing just that today.

MR. HUNTER: Will you at least talk to some of the fisherman in that area and see what their concerns on that are?

MR. WARD: I am glad you mentioned that. I just came back from a week on the road. I went down to visit the major players personally with my directors and a couple of others on Thursday and Friday of last week. They clearly today do not have a problem with selling their product. Not today. I do not foresee that in the immediate future.

MR. HUNTER: I just relayed what they told me about three weeks ago when I was out there.

There is another question I would like to ask the minister too if I can, Mr. Chairman. It regards the fish plant in Triton. It has beautiful facilities out there. The license was awarded to FPI there probably a couple of years. Now they are running into problems. The water line to the plant is not big enough. There is a big panic now that the plant could have to cut back and possibly close, down the road. I am wondering if the minister had anybody to check into that problem and see if there is anything that can be done this spring?

MR. EFFORD: First of all, that is a municipal infrastructure problem. The Department of Fisheries and Aquaculture is not in the position to get involved in providing water lines to any processing, whether it is primary or secondary or whatever.

Our policy is quite clear. We will not put any money whatsoever into the primary processing facilities in the Province. It is all made by private investments. In the meantime, the proponents, the owners of the FPI organization, myself, ourselves, have had discussions and will continue discussions with the Minister of Municipal and Provincial Affairs. I can't make a commitment this evening, but I feel confident that is going to be addressed. Because it is not only in Triton, it is in a number of other areas around Newfoundland where there are a number of fish plants, due to the municipal infrastructure, that can't get the necessary water supply. Particularly in shrimp, where they require an excessive usage of water. That is a municipal thing. It is a problem that has to be addressed and I feel confident it will be.

MR. HUNTER: Also in Triton too, Mr. Minister, I don't know what input your department would have into it, but I believe Triton is one of the few communities in Newfoundland, at that size, that does not have a public wharf there. I think they have been lobbying to get some support for a wharf for Triton. I wonder if your department is aware of that, and if they are, if there is anything you could do to assist the fishermen's committee out there.

MR. EFFORD: On February 9 they placed an awful lot of confidence in yourself when they voted for you, that you could make all the representation possible to the federal government. It is not a provincial issue. It is a federal issue, and they placed an awful lot of confidence in you.

MR. HUNTER: That says something, doesn't it?

MR. EFFORD: That says something, so you have no problems getting that money for the wharf.

MR. HUNTER: Thanks for the compliment, sir.

Thank you very much.

CHAIR: Is that it?

MR. HUNTER: That's it for now.

CHAIR: Mr. Rideout?

Back to you, Mr. Fitzgerald.

MR. FITZGERALD: Thank you, Mr. Chairman.

Minister, maybe we can look at some of the appropriations in the budget there. When I look at the budgets it always amazes me when I see the figures that are put under Transportation and Communications. It almost seems like that is a heading where, if you have some expenditures that you do not want to show anywhere, you push it under - not you, I say to the minister, but all departments - Transportation and Communications. In fact your budget, if you look at it, your department has budgeted $1,025,700 for Transportation and Communications. Maybe you would like to be able to just enlighten us as to what is involved in Transportation and Communications. I suppose there is travel for you and for your staff, but what is Communications? Phone bills, fax bills? It is a tremendous amount of money.

MR. EFFORD: First of all, one of the things you could criticize the department for - and you raised it earlier when you said opening up new markets for the sealing industry. If you are going to open up new markets then there has to be travel to visit, to negotiate, and to have meetings in market development. You are not going to do that sitting in your office in St. John's when there is a reason to go down to the Boston Seafood Show or reason to go to some other part of the world. As minister I have travelled extensively visiting markets. As much as I hate to fly and dislike flying, I have to do it. It is my responsibility. Other people in the department must travel and must be part of promoting the seafood products.

If you look at the amount of money that was spent in the Department of Fisheries and Aquaculture in 1999, and you look at a $700 million export value, with not one nickel outside of that market development of the taxpayers' dollars going into it, I think it is a very profitable industry. That travel - I visited China, visited Japan twice, visited Iceland, visited Norway, visited London, visited the Boston Seafood Show and visited a number of other markets - paid off well.

What does it take in? It takes in communication services, the fax machines, the telephone calls and everything else that goes on in the day to day operations for 365 days a year, plus the five regional offices around the Province. What is the staff in the Department of Fisheries and Aquaculture? Less than one hundred?

WITNESS: About one hundred.

MR. EFFORD: About one hundred. The energy and the productivity of one hundred people involved in fisheries development, fisheries marketing, fisheries research and fisheries productivity with a $700 million export - our budget today, maximum, includes federal cost-shared. Provincial money is $13 million. When your colleague there was minister - and I suspect he could tell you the exact number - it was probably around $35 million or $38 million.

The energy that is coming from this department today was never equalled in the history of the Province.

MR. FITZGERALD: Who paid your ADM's wages and travel allowance while he was looking after the hatchery down in Bay d'Espoir? Did the taxpayers of the Province pay that bill, or was it paid from the income from S.C.B. Fisheries?

MR. EFFORD: Well, first of all, the taxpayers of the Province paid for the $6.4 million that was put into the aquaculture industry to sustain it in Bay d'Espoir. The salary of the ADM was paid for by the Department of Fisheries and Aquaculture. If the aquaculture industry in Bay d'Espoir had been making money, it would not have required the $6.4 million, so therefore it was the responsibility of our department to pay the wages of Mr. Ward while he was down there.

MR. FITZGERALD: So the $6.4 million was a loan guarantee, I understand, was it?

MR. EFFORD: I am sorry?

MR. FITZGERALD: It was a loan guarantee?

MR. EFFORD: The $6.4 million?

MR. FITZGERALD: Yes.

MR. EFFORD: Yes.

MR. FITZGERALD: It was a loan guarantee?

MR. EFFORD: Yes, I answered that today.

MR. FITZGERALD: So the payment for the wages and the cost of having the ADM down at Bay d'Espoir was in addition to that and that came out of your department?

MR. EFFORD: Yes, and he was not down there. He was still performing his duties, working seven days a week in most instances, as an ADM.

MR. FITZGERALD: I am not questioning that.

MR. EFFORD: He was part-time in Bay d'Espoir and it was out of his normal salary from the Department of Fisheries and Aquaculture.

MR. FITZGERALD: How many marine facilities does your department own in the Province now?

MR. EFFORD: Today? Not very many.

WITNESS: One hundred and twenty.

MR. EFFORD: We still own them?

WITNESS: (Inaudible). We had 320. We have around 200 sold.

MR. EFFORD: Yes. There were 320 and we have 200 diversified - gotten rid of.

MR. FITZGERALD: I do not understand that.

MR. EFFORD: We have 120 left. You are talking about the marine service centres.

MR. FITZGERALD: I am talking about the marine service centres.

MR. EFFORD: You are not talking about the (inaudible). That is what I was talking about.

MR. FITZGERALD: So, you are talking about the wharfs, and the slipways and -

MR. EFFORD: Yes, we do not have that many -

WITNESS: (Inaudible).

MR. EFFORD: The marine service centres? We do not have very many.

WITNESS: (Inaudible).

MR. EFFORD: Yes, Bonavista is sold, Burgeo is sold, Durrell is sold. There are twenty-three in total, eight sold, six pending and three ongoing.

MR. FITZGERALD: So, you own nine?

MR. EFFORD: Well, there are eight sold, six pending, three ongoing, and six no action. We still have six more to go; there is no action.

MR. FITZGERALD: I wondered because, when you look at appropriation here, heading 2.1.01, you look at the "...administration of the Department's regional structure including the maintenance and repair of all Government-owned marine facilities in the Province." When you look at that you are not talking, Minister, about going to the Boston Seafood Show or travelling over to China or Japan. You are talking about inter-Province travel.

MR. EFFORD: Yes.

MR. FITZGERALD: When you see Transportation and Communications, $303,600, to me it sounds like a lot of money.

MR. EFFORD: Well, let me go back now. You see, what I am trying to do as the minister is clean up some of the mess that was created by the former government.

MR. FITZGERALD: Ten years and you still do not have it cleaned up?

MR. EFFORD: Remember, they built all of the marine centres.

MR. FITZGERALD: You do not have a very efficient department if you do not have it cleaned up after ten years.

MR. EFFORD: Yes, brother, I have something to clean up. They built all of the marine centres.

MR. FITZGERALD: (Inaudible) former minister.

MR. EFFORD: We are now diversifying; we are now privatizing. We are now putting them where they should have been in day one, so that is being done. Most of the money that you just referred to is incurred by the quality initiatives program that we put forth. We have inspectors going all around the Province checking all the boats, checking all the fish plants -

WITNESS: Thirty of them.

MR. EFFORD: Thirty of them - doing a darn good quality assurance program that was never ever before implemented in this Province.

MR. FITZGERALD: Wouldn't that be come under processing?

MR. EFFORD: When you go down to the marketplace now and talk to someone like Red Lobster, or some company in the United States, and you see that the quality of Newfoundland sea products is second to none in the world, then that little bit of travel is well worth it in a $700 million export value.

MR. FITZGERALD: But, Minister, you are not giving me the right information. If you look at heading 2.3.01, it would include again all those things that you just suggested. It would include licensing, inspection, provision of technical and financial services, and for that, Minister, we see another $152,900. So it has nothing to do with inspections and licensing and quality control.

MR. EFFORD: So where is the money supposed to come from to pay -

MR. FITZGERALD: I am asking. I do not know where it is -

MR. EFFORD: Let me answer the question. You have to pay regional staff, and you have to pay your headquarters staff. The administration of the Department of Fisheries has to be paid for, and the travel that is incurred around the Province by the regional staff and by the thirty inspectors that is going around. The total budget of the Department of Fisheries and Aquaculture, including the federal cost-shared programs today, in 1999, is $13.5 million compared to $35 million or $38 million a decade ago.

MR. FITZGERALD: It still seems like an awful lot of money.

MR. EFFORD: Thirteen million compared to $38 million is a lot of money? What would you have said if you had been sitting in my shoes in 1985?

MR. FITZGERALD: It seems like an awful lot of money when you are saying that you are spending one-third of a million dollars for travel, looking after your marine centres around Newfoundland and Labrador.

MR. EFFORD: That is not correct.

MR. FITZGERALD: Well, that was the statement that you gave me.

MR. EFFORD: I did not say that. I said, inspectors going around at the quality assurance program.

MR. FITZGERALD: The inspectors are another $152,900. Alright, if you want to use that, we will lump the two of them together and we will call it half a million dollars.

MR. EFFORD: Sorry?

MR. FITZGERALD: If you want to do it that way, then we will lump the two of them together and we will say half a million dollars.

MR. EFFORD: Yes, and what is the point you are trying to make?

MR. FITZGERALD: The point I am trying to make is that is sounds like a lot of money for transportation and communications around the Province.

You have representatives. Out in Bonavista for instance, you have a representative that looks after the area there. So you are not sending somebody from St. John's on a daily basis out to look after your interests in those areas. I would assume they are in other places around the Province.

MR. EFFORD: We have five regional offices around the Province. Each one of those five regional offices are staffed. There are not many into them; what, three or four in each one?

WITNESS: On average about five.

MR. EFFORD: On average about five.

On top of that, you have thirty inspectors that in the fishing season are travelling all over the Province, wherever the boats are docking, checking whether it is crab, or whether it is shrimp, or whether it is caplin or whatever. That is costly when you have people travelling around the Province checking every dock where there are boats off-loading.

Apart from that, during the off season from the fishing season they are then employed in the regional offices doing inspections into and working with the Fisheries Loan Board and with the marine service centres. If you look at the five regional offices, and you look at the administration responsible for that activity around the Province, what is $500,000 or $600,000 for twelve months compared to a decade ago when it was costing $4 million or $5 million? I think we are doing a darn good job.

MR. FITZGERALD: Property, Furnishings and Equipment -

MR. EFFORD: New chesterfield in my office.

WITNESS: What colour?

MR. EFFORD: Black.

MR. FITZGERALD: - is another one where there is a fair amount of money spent, Minister, $1,025,700. What is included in Property, Furnishing, and Equipment? I know it is not your office furniture. What is included in it?

MR. EFFORD: One million? I have to check on that one.

MR. FITZGERALD: You can; $1,025,700.

MR. EFFORD: What subhead are you reading?

MR. FITZGERALD: That is the total of your subheads under properties and furnishing.

MR. EFFORD: Where are you reading it from?

MR. FITZGERALD: I added up the Property, Furnishing and Equipment for your department. You can pick them out and go through them, if you want, under each heading.

MR. EFFORD: You totalled it up?

MR. FITZGERALD: The total is $1,025,700.

MR. EFFORD: I can tell you one thing, it was not spent on furniture. You had better check it again.

MR. FITZGERALD: No, that is correct, Minister.

MR. EFFORD: You tell me the page it is on.

MR. FITZGERALD: All you do is look at the headings. You look at your property and furnishings under each heading and total them up and that is your departmental costs for Property, Furnishing and Equipment for the year.

MR. EFFORD: I am going to tell you, you have to go back to school.

MR. FITZGERALD: Add them up and see what you get.

MR. EFFORD: I am adding them up. No, it is not there.

MR. FITZGERALD: Yes, it is there.

MR. EFFORD: Not even close. He cannot add and subtract.

MR. FITZGERALD: Add them up and see.

MR. EFFORD: Anyhow, the Property, Furnishings and Equipment in offices could be computers -

MR. FITZGERALD: The one there under Administration and Support Services, for instance, $121,900.

MR. EFFORD: The largest one. That is for computers and whatever equipment is needed for the office staff.

I can tell one thing, there is no computer in my office. I do not even know how to turn it on.

MR. FITZGERALD: You have a buddy here.

MR. WARD: The total I get is roughly $240,000.

MR. EFFORD: My ADM tells me the total he gets is about $240,000.

MR. FITZGERALD: (Inaudible).

MR. EFFORD: About $240,000. You have to go back to school.

MR. FITZGERALD: Under 2.1.02., Labrador Fish Plants -

MR. EFFORD: Kelvin, do you have a pocket calculator?

MR. FITZGERALD: Tell him to total up Transportation and Communications, while he is at it, and see what he gets.

MR. EFFORD: You made a mistake, seriously - about $250,000.

MR. FITZGERALD: Look at 2.1.02.

MR. EFFORD: 2.1.02.

MR. FITZGERALD: We can back up one, 2.1.01., Property, Furnishings and Equipment, under Administration and Support Services, $13,600 budgeted and revised to $94,400.

MR. EFFORD: That was the purchase of vehicles for the department. We had vehicles out there that staff were using - one on the West Coast, I think, had over 400,000 kilometres on it. It was just stopped by inspection and ordered off the road. We just could not continue, so we had to buy some vehicles.

MR. FITZGERALD: Under 2.1.02, Labrador Fish Plants.

MR. EFFORD: That is subsidy to Torngat Fisheries to Makkovik and Nain.

MR. FITZGERALD: Is that depleting itself as time goes by?

MR. EFFORD: Our intention is to deplete that down to zero dollars when the plant has enough productivity to do that. We had hoped that when Voisey's Bay had gotten on the go, there would not have been so much pressure on seeking employment into the Nain fish plant. With the situation with Voisey's Bay, the people in Nain need work and naturally the fish plant is the only -

MR. FITZGERALD: (Inaudible).

MR. EFFORD: There is more pressure applied so we have maintained the subsidy this year at $200,000 but we have reduced that from $800,000 annually subsidy down to $200,000. Our intention is, when possible - I am not going to say next year because circumstances may not allow it. If you are living in Hopedale, Nain or Makkovik, and there is no other opportunity of employment, I do not think anybody can argue that is not money well invested.

MR. FITZGERALD: I think it was something like $400,000 back in the 1997 Budget, $300,000 this year, and next year $200,000.

MR. EFFORD: If circumstances allow, it will be scaled down to zero dollars.

MR. FITZGERALD: The other one that jumps out at me here is Purchased Services, under 2.1.03., where there was $90,000 budgeted, $10,000 spent, and this year there is another $90,000 back there.

MR. EFFORD: Is that my travel? That could be my travel.

WITNESS: (Inaudible).

MR. EFFORD: Oh, yes.

One example there is down in the Nain fish plant. We had to make some improvements to the fish plant because of the location of the electrical room and furnace. It was right inside in the fish plant and had to be moved out. There was a small piece built on that fish plant. It is capital works in a number of areas, but that is one of areas that took up most of that money.

MR. FITZGERALD: Section 2.2.02., Middle Distance Fishing Vessel. Do we have any middle distance fishing vessels now?

MR. EFFORD: Ask your buddy.

MR. FITZGERALD: I am asking you.

WITNESS: You are the minister. Do we have any is the question?

MR. EFFORD: No, they are all gone.

WITNESS: Right, exactly, so answer it.

MR. EFFORD: It took me all these years to get rid of the mess.

MR. FITZGERALD: What did you do with the Nain Banker? Where did it go?

MR. EFFORD: Labrador Shrimp Company.

MR. FITZGERALD: So that was given to them at the time?

MR. EFFORD: I wish I had three or four of them here now.

MR. FITZGERALD: Are they using it actively?

MR. EFFORD: Yes, Sir, creating a big demand.

If I had that $40 million that was wasted, I would have ten or fifteen of them on the go now.

MR. FITZGERALD: There was no money put forward for Purchased Services in 1997, and there is nothing showing in 1998-1999 under Middle Distance Fishing Fleet. If we have passed this over to the fish plant down there, are we still responsible for the cost of it?

MR. EFFORD: I am sorry, what was that again?

MR. FITZGERALD: There were no appropriations provided for Purchased Services back in 1997, and there was nothing in 1998. This year I notice you have the Estimates put forward where there is another $100,000 there.

MR. EFFORD: For what?

MR. FITZGERALD: For the Middle Distance Fleet, Purchased Services.

WITNESS: That is just contingencies (inaudible).

MR. EFFORD: That was contingencies there just in case it was needed. The deal was clued up a couple of weeks ago.

WITNESS: A week ago.

MR. EFFORD: A week ago, on the Nain Banker, and that will not now be drawn down because it is now in the hands of a private company. Actually, I would think, as we are talking tonight it is probably out hauling nets.

MR. FITZGERALD: It is probably what?

MR. EFFORD: Fishing.

We are not responsible for anything.

MR. FITZGERALD: Why would we put $100,000 there for Purchased Services for a vessel that we do not own?

MR. EFFORD: Because that was before - the deal was only done a week, a week and a half, or two weeks ago.

Now, I can use that for travel.

MR. FITZGERALD: Purchased Services, under 2.3.01.06, $119,200 in the Budget, $186,700 in the revision, and up to $221,700, an extra $100,000. What is that for? Is that (inaudible) purchase?

MR. EFFORD: Most of that went into the (inaudible). I must say -

MR. FITZGERALD: Went into what?

MR. EFFORD: There are not enough words to describe the excellent presence that we made this year at the Boston Seafood Show. Three years ago, previous to my becoming minister, we stopped having a reception at the Boston Seafood Show. I reinstated that. We reorganized the booth display down there and put a number of banners around our program at our reception promoting quality. I can tell you, the few dollars you just mentioned were well invested. The staff of the Department of Fisheries and Aquaculture was noted this year - Newfoundland and Labrador was noted this year as having the most viable presence at the Boston Seafood Show. That says something, for it is the largest seafood show in the world.

MR. FITZGERALD: Minister, the $1,459,700, I'm sorry, I said to you it was Property, Furnishings and Equipment. It was Purchased Services. That was the heading I had totalled up.

MR. EFFORD: Yes.

MR. FITZGERALD: Page 120, 3.2.01, under Purchased Services there again, there was $390,500. Then it was revised to $150,000 and this year it is back up again to $264,000 for the Newfoundland Economic Renewal Agreement, 80 per cent cost-shared by the federal government. Why the big difference there?

MR. EFFORD: That is on the ACERA agreement. Is that right?

WITNESS: Yes.

MR. EFFORD: Do you want to deal with that? That is on the federal-provincial aquaculture agreement.

MR. WARD: Most of those relate to services for consultants and our contractors under the cost-shared agreement, of course, federally and provincially.

MR. FITZGERALD: For the what?

MR. WARD: Consultants' fees, contractors' fees, for a number of projects that are ongoing and so on.

MR. FITZGERALD: When you follow down there to 01, Revenue-Federal, I look at that and the way I read it - I'm sure I must be reading it wrong - when you look at the budget there, $4,649,000 and you look at the revision of $1,783,300, and even on forward to the estimates, there is still in excess of $1 million there. Does that mean we are not spending the amount of federal money we are taking in under that particular heading?

MR. EFFORD: That is a three year agreement. So I mean you don't spend it all -

MR. FITZGERALD: So this is the amount we are spending this year?

MR. EFFORD: Yes, you do not spend it all in the one year.

MR. FITZGERALD: No, I did not know it was a three year agreement.

WITNESS: Five years.

MR. EFFORD: For five years, I'm sorry.

MR. FITZGERALD: It is a five year agreement.

MR. EFFORD: A five year agreement, yes.

MR. FITZGERALD: Okay. So that will be spread over the five years. This money that we have spent here is up until now, or is this an agreement that has been entered into this year?

MR. WARD: (Inaudible) four years ago.

MR. EFFORD: That started four - yes, go ahead.

MR. WARD: The aquaculture agreement is the aquaculture component of the Economic Renewal Agreement. We are actually entering the fourth year of that agreement, and it extends out until March 31, 2001, a five year program. In total, there is $20 million over five years, cost-shared, federal-provincial.

MR. FITZGERALD: So next year we should be showing approximately $1,500,000-something there which we will use up, the remainder of that agreement?

MR. WARD: That is correct.

MR. FITZGERALD: Would that be the same thing for the Economic Renewal Agreement on 3.2.02, where here again we see Revenue-Federal $2,720,000? It is still a sizable amount of money there again that is not spent. This is another federal-provincial agreement over what, a five or three year period?

MR. WARD: It is the same agreement over a five year period. Capital.

MR. EFFORD: It is the same agreement, capital expenditure.

MR. FITZGERALD: It is the same agreement.

MR. EFFORD: One is current, one is capital.

MR. FITZGERALD: Okay. I am just as confused as ever after that.

Assistant Deputy Minister, are there any mussel farms in this Province today that are turning a profit?

MR. WARD: We certainly do not have their financial statements but there are quite a number of mussel farms. They are all private. What has been happening is they have to get their production up to a level that makes them economically viable.

If you look at it in total, there are a little over one hundred licenses out there. About twenty of them are very serious farmers and they are employed full-time in that industry. So yes, there are a number of mussel farmers who are making money. If you look at the opportunities within the Province, unquestionably mussels would be one that you would have to rank -

MR. EFFORD: The most confidence.

MR WARD: - as one with the most confidence within the industry. Especially with the aquaculture working capital fund that has set up for $5 million specifically to deal with shellfish and mussels to be at least 80 per cent of that.

MR. EFFORD: That is not a grant, that is a loan. Each independent farm which comes and applies for that money must come in with an appropriate business plan. It will be based on the economics of that business plan if they will get a loan. Each farm that is out there is privately owned. Whether they are making one dollar or $500 or $5,000, that is private industry. That is not government controlled.

MR. FITZGERALD: It is nice to know how the industry is going. That is the reason for the question.

MR. EFFORD: Gerry just explained. In three or four years down the road I can see the majority of those mussel farmers, whoever is there now, will be in a very substantial position in the future of making a good living. I mean, the opportunity is there, the climate conditions and the environmental conditions are right, the market conditions are right. Now they have a $5 million loan program they can avail of to expand their operations. So yes, the future is very good. They were restricted because they went to the banks and the banks would not talk to them. Now this $5 million -

MR. FITZGERALD: It is a long-term -

MR. EFFORD: Yes, now this $5 million loan program is going to allow them to expand their operations. I can see four years, Gerry, five years?

MR. WARD: If you look at the mussel industry, in a three year period we have come from 362 metric tonnes to 650 metric tonnes to 947 metric tonnes, and we will do 2,000 metric tonnes this year. Any time you can do 50 per cent and 100 per cent increase in your production, it may not sound like much in comparison to P.E.I. but they started low as well. If you get four or five years of 50 per cent and doubling your production, you will be up to 5,000 tonnes-plus within a three to four year period. That is really what we are talking about with the shellfish working capital fund.

MR. FITZGERALD: It is an excellent product. I guess most of what we buy here locally is from local farms I would assume, or I would hope. Down where I live there is an excellent area for wild mussels. We get them much bigger down there. I see those small mussel in the store and I pass them by but recently I have been buying them and they are excellent. There is no reason why it would not be successful and create some opportunities. Would mussel processors and sea urchin processors be the same people?

MR. EFFORD: I'm sorry, what was that?

MR. FITZGERALD: Would mussel processors and sea urchin processors be the same people?

MR. EFFORD: No.

MR. FITZGERALD: Not necessarily. How many sea urchin processors do we have?

MR. EFFORD: Maybe one or two. Sea urchins? There are five sea urchin processors in the Province. It is not impossible for them to be the same one. The one on Bell Island is doing sea urchins. I'm not saying they could not do mussels but they have not been in the mussel industry. There is -

WITNESS: (Inaudible).

MR. EFFORD: Pardon? Portugal Cove is doing sea urchins and they are also doing mussels. Jim Parsons. So they certainly can. I mean, somebody doing primary processing of mussels can also do primary processing of sea urchins. It is the same as you can do cod, you can do flounder, you can do turbot. You are not restricted to one species. That is the opportunity. If they have the licences it is up to the individual who wants to take advantage of the markets.

MR. FITZGERALD: Yes, but right now they are not.

MR. EFFORD: Portugal Cove is one example that is doing both.

MR. FITZGERALD: Just one.

MR. EFFORD: I think there is one other one.

MR. FITZGERALD: When do you expect to hear the announcement on the quota that is being brought forward in 3Ps and 2J+3KL for cod fishery?

MR. EFFORD: On May 6.

MR. FITZGERALD: That is when it is going to be brought forwarded. Any idea what the quotas might be?

MR. EFFORD: I would not be a bit surprised if it is not increased to somewhere between 25,000 tonnes to 30,000 tonnes total.

MR. FITZGERALD: In 3Ps?

MR. EFFORD: In 3Ps.

MR. FITZGERALD: What are we looking at in 2J+3KL?

MR. EFFORD: There is not going to be an announcement on May 6 on that one. It is going to probably be a week or two later because they want to an assessment of the two different scientific views that have been put forward. I would say it would be two weeks later?

WITNESS: May 17 or May 18.

MR. EFFORD: May 17 or May 18.

MR. FITZGERALD: There is no indication of what they are looking at?

MR. EFFORD: No, no indication. I would be very surprised, Roger, if they are going to get what they are asking for, 35,000 tonnes. I think the fishermen will be happy if they get a reasonable increase.

MR. FITZGERALD: Yes. I think if you could see 15,000 tonnes or 20,000 tonnes.

MR. EFFORD: If they could go up to -

MR. FITZGERALD: If you saw 15,000 metric tonnes there, it may not make them happy but it would satisfy them.

MR. EFFORD: Last year the fishermen in that area averaged 2,700 pounds per boat.

MR. FITZGERALD: Four thousand metric tonnes, 2,700 pounds each.

MR. EFFORD: If they went up, say, to 10,000 pounds or 12,000 pounds I do not think anybody is going to argue that one.

MR. FITZGERALD: That is right, and now with the extra quota they have for crab, well, the next thing you know they are looking after themselves again, at least.

MR. EFFORD: That is right.

MR. FITZGERALD: Build on it from there.

MR. EFFORD: Yes. My concern was getting the 10,000 pounds or the 12,000 pounds, whatever they do get, are they going to catch it?

MR. FITZGERALD: That should not be any problem, if the last year is any indication.

MR. EFFORD: I cannot talk about Bonavista Bay because you know more about that, but I know I went out fishing last year in Conception Bay under the recreational fishery. The first day we went out we caught our ten fish. The next day we never got them. That tells me there is not much of a body of fish.

MR. FITZGERALD: It was not uncommon to do that, Minister, as you know, when we had the fishery either.

MR. EFFORD: What did they do in Trinity Bay? They had to go to Smith Sound where the big body fish are. They did not get them in the traditional grounds. That gives me some concern. I hope and pray I am wrong. I only hope they get the quota. Now, the other side of me says I hope they don't, because if they don't then they are going to come screaming the darned seals have eaten them all. Then they will shake David Anderson out of his office.

MR. FITZGERALD: How about the food fishery? Not a recreational fishery, a food fishery. Is there any indication what we might be seeing this year?

MR. EFFORD: No.

MR. FITZGERALD: For God's sake, convince your cousins to treat everybody alike.

MR. EFFORD: Not my cousins.

MR. FITZGERALD: Whatever it is they get up in Nova Scotia, New Brunswick then -

MR. EFFORD: Don't you ever refer to them as my cousins.

MR. FITZGERALD: - at least help us here as well. It is the same thing. We are the same people, and it is the same fish.

MR. HUNTER: (Inaudible) question.

CHAIR: Mr. Hunter.

MR. HUNTER: (Inaudible). What percentage of the total number of mussel farms is in Green Bay south?

MR. WARD: I will say that 60 per cent of all the mussel production comes from the area in Green Bay. That basically equates to the licences as well. I would say there is about 70 per cent -

MR. EFFORD: You should know that. It is your district.

MR. WARD: About 70 per cent of all the licences will be in Green Bay-Notre Dame Bay.

MR. EFFORD: You didn't know that?

MR. HUNTER: I figured somewhere around 70 per cent. I did not know for sure. That is another reason to enhance the processing in that area, rather than trucking it somewhere else.

MR. EFFORD: (Inaudible) Port de Grave.

MR. HUNTER: Particularly Port de Grave, yes. Probably we could truck it to Buchans or somewhere. A fish plant in Buchans would go over pretty good, wouldn't it?

CHAIR: Does anyone else have questions?

MR. FITZGERALD: (Inaudible). Minister, Grants and Subsidies as well under each one of those headings there. Some of those are talking about fairly large sums of money. Maybe you would like to explain a couple of them, at least what they are all about.

For instance, Grants and Subsidies under 1.3.02. Last year it was budgeted for $300,000 and the revision showed the exact amount. This year the Grants and Subsidies is completely taken away.

MR. EFFORD: (Inaudible).

MR. FITZGERALD: Subhead 1.3.02., Resource Policy Administration.

WITNESS: (inaudible) the Chair.

MR. EFFORD: Oh, the Chair?

If you are referring to the contribution that we committed to the Chair at Memorial University, the Resource Conservation Chair, we committed $1.5 million over a five year period, averaging $300,000 a year, and this is the final year?

WITNESS: Last year was the final year.

MR. EFFORD: Last year was the final year.

George Rose, actually, a scientist -

MR. FITZGERALD: Money well spent.

How about moving up to Grants and Subsidies under 2.1.01., Administration and Support Services; again, government-owned marine facilities. Would this be the money that I just asked you about, the $3,000 that is being brought forward there?

MR. EFFORD: Yes.

MR. FITZGERALD: Grants and Subsidies, 2.3.01.10., Administration and Support Services, $480,000 revised to $308,000 and this year up to $380,000 again.

MR. EFFORD: Most of that is for the subsidy to the seal meat program.

MR. FITZGERALD: Does that disappear this year?

MR. EFFORD: One more year.

MR. FITZGERALD: One more. What is it down to now - two cents, three cents, eight cents?

MR. EFFORD: Sorry?

MR. FITZGERALD: What are we subsidizing per pound this year?

MR. EFFORD: Oh, per pound -

MR. FITZGERALD: Not very much.

MR. EFFORD: It is $2.50 per carcass and $1.34 for the beaters.

MR. FITZGERALD: Okay.

That will probably change as well, depending on what is taken.

Section 3.1.01.10., Administration and Support Services, Grants and Subsidies, $115,000.

MR. EFFORD: That is for the mussel incentive program.

MR. FITZGERALD: Section 3.2.01., Economic Renewal Agreement.

MR. EFFORD: That is for the fisheries development.

One of the things that we have to do each year is keep a component of the Department of Fisheries and Aquaculture for fisheries diversification, underutilized species, research -

WITNESS: (Inaudible).

MR. EFFORD: This one here? Are you talking about 3.2.01.?

MR. FITZGERALD: Yes.

MR. EFFORD: Okay, I am sorry. I thought you were talking about the Economic Renewal Agreement. That is where -

MR. FITZGERALD: Yes, the Economic Renewal Agreement.

MR. EFFORD: Yes, but that amount of money, $3,589,500, is for the Research and Development Centre out at Logy Bay - aquaculture.

MR. FITZGERALD: Yes.

I do not have any more questions.

MR. EFFORD: Thank you.

CHAIR: Anyone else? No more questions?

I have one comment, Mr. Minister.

MR. FITZGERALD: Minister, those (inaudible) people you were in talking to, did they ever come back looking after?

MR. EFFORD: Not yet.

MR. FITZGERALD: Okay.

I talked to them the other day. You haven't heard? You don't know anything more about that?

MR. EFFORD: No, I talked to you about that. I haven't seen them since.

MR. FITZGERALD: They called me and wanted to know if they could get a meeting. Then they called back after and said to hold off.

CHAIR: Are you finished? I have a couple of comments or questions.

The marine service centres, the one you had in Durrell, you sold that one, I think, to private enterprise. That one is working very well. I think you are having some problem with the one on Fogo Island, or at least that is what I am hearing.

MR. EFFORD: We had a petition from a couple of the fishermen on Fogo Island but I think it is just a matter of ironing out some of the difficulties between the party who has the centre and some of the fishermen. I do not think there is going to be any major problem there.

CHAIR: On the middle distance fleet, you say you are going to have a $100,000 left over this year that you are not going to spend because they got rid of the Nain Banker. I would certainly make a recommendation that we put that into that facility repair program that you have. It is one way you get $3,000, as Mr. Fitzgerald brought up, because I think that is probably one of the better programs that we have in government, not just in your department.

In my district - and I guess it is like all the fishing districts in the Province - I do not know who built all the wharfs we have, and maybe all of them were not needed, but it is a sin to see them fall down when we can, for $2,000 or $3,000 a year, maintain those facilities. If we let them all go, then your department is going to be faced with finding millions of dollars one of these days to replace some of them around the Province. I think that is probably the best program you have and I would certainly advise -

MR. EFFORD: We will take in under consideration.

CHAIR: - definitely, for an extra $100,000 into that.

MR. FITZGERALD: (Inaudible).

CHAIR: No, you go ahead.

MR. FITZGERALD: The thing about that too, Minister - I do not know who drew up the criteria or brought forward the rules and regulations. We are sitting here tonight and there is nobody who sits in this House who does not believe that the fishery of Newfoundland and Labrador is going to provide a future. There is a fishery, and there is going to be a very vibrant fishery in the future.

For the federal government to come out and say that the millions of dollars that were put forward in rural Newfoundland and Labrador for make-work projects - call it whatever you want but that is what they were - could not be spent on fisheries infrastructure. It makes you wonder where they are coming from - the mind set. Here we are with the fisheries now coming back in certain areas and we are encouraging people to get involved again, and they are looking for quotas, and our fisheries infrastructure is falling down around our ears.

MR. EFFORD: I do not know where you are coming from because it must up to the MHA in a particular district. Everything that we have invested out in Port de Grave is for fisheries infrastructure; $5.8 million in the harbour development out there, fisheries infrastructure. They need a new MHA, boy.

MR. FITZGERALD: Well, maybe that is the reason but I will tell you that down in our area it was looked after by the regional offices, and each regional office had their own rules and regulations -

MR. EFFORD: They should talk to (inaudible).

MR. FITZGERALD: - I suppose put forward by the minister. In the Clarenville office they were very adamant. The only money that got spent on wharf construction or repairs or slipway construction was the money that came from the Ministry of Municipal and Provincial Affairs and I got matched with federal dollars and put it in that direction myself.

MR. EFFORD: Lloyd gave you money?

MR. FITZGERALD: The federal money, that was the criteria, the stipulation. No -

MR. EFFORD: Are you telling me that you got money from the provincial Department of Municipal Affairs?

MR. FITZGERALD: I got my share from your department, too.

MR. EFFORD: No, you did not.

MR. FITZGERALD: Oh, yes I did.

MR. EFFORD: No, you did not.

CHAIR: I will not argue about that but I have to concur with Mr. Fitzgerald that the federal program -

WITNESS: (Inaudible).

MR. EFFORD: (Inaudible). I will check on that tomorrow.

CHAIR: Are there any more questions? I will call for the headings?

On motion, headings 1.1.01. through 3.2.02., carried, without amendment.

On motion, Department of Fisheries and Aquaculture, total heads, carried.

CHAIR: We will meet again on Thursday at 5:00 p.m.

WITNESS: Tourism, Culture and Recreation.

CHAIR: Tourism, Culture and Recreation.

Thank you, Minister, for coming. Thank you to your officials.