The Committee met at 9:00 a.m. in the House of Assembly.

MR. K. AYLWARD: I would like to welcome everyone to the Estimates Committee of the Department of Forest Resources and Agrifoods. I believe we have to move a motion for the Chair and the Vice-Chair.

On motion of Mr. Butler, seconded by Ms Kelly, Mr. Aylward was elected Chairman.

On motion of Mr. Hodder, seconded by Mr. Butler, Mr. Byrne was elected Vice-Chairman.

CHAIR (Aylward): I said I wasn't running for anything else but, gee, that is pretty good. I just got elected again, as Chairman.

It is good to see you folks. Good morning. Maybe we will have the members of the Committee introduce themselves and then, Mr. Minister, if you could do the introduction of your officials. If we could go here on my right to the members of the House.

MR. TAYLOR: Trevor Taylor, MHA for The Straits & White Bay North.

MR. E. BYRNE: Ed Byrne, MHA for Kilbride.

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

MR. H. HODDER: Harvey Hodder, MHA for Waterford Valley.

MS KELLY: Sandra Kelly, MHA for Gander.

MR. BUTLER: Roland Butler, MHA for Port de Grave.

CHAIR: Okay.

Mr. Minister.

MR. WOODFORD: Rick Woodford, Minister of Forest Resources and Agrifoods. I have with me this morning: Allan Masters, Deputy Minister; Dr. Mohammed Nazir, Associate Deputy Minister of Forestry, and Chief Forester with the department; and Marty Howlett, who is Associate Deputy Minister of Agrifoods.

CHAIR: Thank you, Mr. Minister.

Before we proceed, we normally allow the minister up to fifteen minutes to give an overview of his department. Also, before speaking to the Estimates, do we want to go ten minutes at a time for each member and then we will kind of let it go from there?

MR. E. BYRNE: Can I ask a question?

CHAIR: Yes.

MR. E. BYRNE: Normally, and I would assume it is the same, the critic for our parties here - (inaudible) part of the Committee - the practice has been that, as critic, the time be allotted, and we would give up our time if necessary, okay?

CHAIR: Okay, no problem.

Also, when we speak into the mike, because of the system we have, we need to identify ourselves; so, if we could identify ourselves when we speak. There is some give and take going back and forth as we get going, but if we could still keep identifying ourselves we would appreciate that. The Chair will try to identify you, or will identify you, as we go back and forth. If I interrupt you, it will only be for a second, just to say it is the Member for Kilbride or it is the minister or whoever. We need to do that for clarification with Hansard. I think that is about it.

On the Estimates, we will start at 1.1.01. and leave it open-ended for the duration, if that is okay with the Committee.

Mr. Minister.

MR. WOODFORD: I am going to try to keep this brief. I gave the boys a copy of the statement. I will do the Forestry one first.

In Forestry, most of the programs such as silviculture, insect and fire control, are expected to the same level as last year; however, there are changes in the components of these programs which are worth noting. For example, after considerable re-evaluation of silviculture, my department is placing more emphasis on tree planting. As a result, tree seedling production at Wooddale Tree Nursery will be expanded from 7 million in 2002 to 10 million trees in subsequent years. The expansion in the tree nursery will allow both the increase in forest tree plantations in the future and will also allow the propagation of planting stock for new agricultural crops, which I will talk about in a few minutes.

Overall, approximately 4,500 hectares will receive thinning treatment, 3,500 hectares will be fully planted, while approximately 1,000 hectares will undergo incremental planting - that is fill or gap planting whereby nursery seedlings will be planted among existing natural regeneration to bump up stocking to optimize site productivity - and 1,000 hectares will be treated with additional planting stock - that is gap planting - to improve tree productivity. Approximately 9 million seedlings, including in Labrador, will be planted in 2003. The silviculture program alone will result in 5,000 work weeks of employment.

In the insect control program, while there is a modest increase in forecasts for insect infestation with the hemlock looper and the sawflies, the major change is in the distribution of the forecast areas on the Northern Peninsula, Western Newfoundland and Central Newfoundland. While infestation declined in some areas, such as Bay d'Espoir and last year's treated areas in Western Newfoundland, new areas are expected to be infested.

I want to provide the explanation for increased firefighting costs in 2003, as shown in the revised figures in the Budget document. This was because of large fires in Labrador and on the Northern Peninsula. This required an extraordinary increase in cost.

A major and very significant change in the forestry program is the emphasis on Labrador. As you may be aware, last year we made substantial progress in facilitating involvement of Aboriginal people in forest management in Labrador. We completed a process agreement with the Innu and negotiated another interim forest management agreement with the Innu. An agreement was also signed with the Métis in Labrador. As a result, a forest management plan in District 19 - that is in the Goose Bay area - has been completed and registered for another environmental review. Work on management plans for Coastal Labrador will continue this year.

In order to facilitate forestry operations in Labrador, additional funding has been provided for forestry road construction in Labrador. While major emphasis will be on the Coast of Labrador, the Goose Bay area will also see significant forest road construction activity. Approximately 100 kilometres of forestry roads will be either constructed or reconstructed in the Province, and funding for continued Aboriginal participation in forestry has been provided.

My department is constantly working on improving the effectiveness of integrated forestry, wildlife and law enforcement. A few weeks ago I announced the creation of a new special investigation unit in the Province. This unit will become fully operational in the current year. This is another example of using the existing financial resources to improve the effectiveness of our law enforcement program. This department processes approximately 1,600 violations concerning forestry, wildlife, ATVs, inland fisheries, migratory birds and others. That is the forestry, and a little short one here now on the agriculture part of it.

Agriculture and agrifoods production in Newfoundland and Labrador is a growth industry. Sales at the primary and value-added levels are over $500 million and the industry provides employment to over 4,000 people in many areas of Newfoundland and Labrador.

The agrifoods branch promotes development of the agrifoods industry in the Province. Specifically, the agrifoods branch works to further advance and grow the industries competitiveness, sustainability, and profitability; increase the value of secondary food manufacturing in the Province; enhance agriculture land productivity; minimize the impact of animal diseases on our agricultural economy and public health; and expand agriculture production in Labrador.

The 2001 census of agriculture reported some significant developments for agriculture in Newfoundland and Labrador. Farm cash receipts increased 19 per cent over the 1996 figures. Other findings include: Land in production increased by 10 per cent to 44,900 acres and an average farm size increased by 7 per cent to 156 acres. There was positive growth in the number of sheep and lamb, hens and chicken, cattle and calves. Activities in greenhouse, nursery sods and Christmas trees doubled over the last ten years. Since 1996 Christmas trees has expanded 30 per cent, while nursery products and sods grew 47 per cent and 22 per cent respectively. The total of capital value of farms increased 11 per cent to $204 million. While the vegetable sector declined somewhat, the industry diversified into nontraditional crops with a 40 per cent increase during the period of 1986 to 1996. During the period of 1996 to 2001 traditional vegetable areas declined by 21 per cent as compared to 2 per cent for the nontraditional vegetables.

The Newfoundland and Labrador Agrifoods Industry has grown significantly in recent years and the future looks bright for the expansion of some of our traditional commodities; for example, the dairy and for a new and emerging industry such as: neutraceuticals, cranberries, and life science in general. However, the global marketplace and the influence of the World Trade Organization on funding levels for industry will be critical factors that the industry and government will be required to face.

Federal and provincial governments are finalizing a new funding program that will consider the support necessary for a stable industry based on growth and profitability. The APF is a new approach which ensures that the industry is positioned as a world leader in food safety, innovation and environmentally responsible production. Newfoundland and Labrador will be a full partner in the development and implementation of the APF. As a result, the agrifoods industry will grow and prosper.

That is a little outline of both departments. Members have a copy of that.

Thank you, Mr. Chairman.

MR. K. AYLWARD: Thank you, Sir. Thank you, Mr. Minister.

Mr. Byrne.

MR. E. BYRNE: Thank you.

Good morning, thanks for coming. I guess there will be lots of questions, I suppose, over the morning. I just have some dealing with specifics in the budget as opposed to the larger issues at first.

Last week in the House I asked a number of questions to the Minister of Finance dealing with what was in the budget in terms of what is being requested under a variety of headings, particularly under Salaries and actually - in terms of Departmental Salary Details - what is there. There seems to be a discrepancy.

The minister talked about - I think what is in the Salary Details are permanent employees but it does not allow for contractual employees. I just have some questions, minister, just general ones throughout different subheads. I will start with your own office. For example, salaries in your office are budgeted at $271,400 - this is in subhead 1.1.01 - yet in the Salary Details it says the total request for salaries in your office is $230,096. Is the reason for discrepancy dealing with temporary employees, or contractual employees, or units yet to be hired, or considering being hired? What is the discrepancy there?

MR. WOODFORD: The first one, you are asking why the increase?

MR. E. BYRNE: No, not why the increase. In the Departmental Salary Details, under forestry, it says that the Minister's Office under Salaries is $230,096. Yet, in the budget you are requesting $271,400. I am just wondering why the difference? Can you make those documents compare there, Minister?

DR. NAZIR: (Inaudible) overtime and (inaudible) the total comes to $271,000. So $230,00 is permanent.

CHAIR: Minister Woodford.

MR. WOODFORD: There is no $230,000 here.

WITNESS: No, he looking at this one.

MR. WOODFORD: Okay, in the details. You are looking at the Departmental Details.

MR. E. BYRNE: Yes, basically I am comparing what is requested in the budget -

MR. WOODFORD: The Temporary & Other Employees is $21,500; Overtime & Other Earnings, $13,000; Permanent & Other Adjustments is $6,804, for a total of $271,400. That is where they come from there.

MR. E. BYRNE: That is where they come from, okay.

MR. WOODFORD: So the Temporary & Other Employees there and it is a breakdown of the overtime - oh yes, that is right, that is here for you. You can see it.

CHAIR: Mr. Byrne.

MR. E. BYRNE: So these are -

MR. WOODFORD: It comes up to $271,400.

MR. E. BYRNE: So these are additional costs that are just factored in for contractual or temporary employees that you may hire from time to time?

MR. WOODFORD: Yes.

MR. E. BYRNE: Okay. I guess the same would apply then - maybe you have answered the question for me altogether. In the next section, 1.2.01. under Executive Support.

MR. WOODFORD: 1.2.01., Executive Support?

MR. E. BYRNE: Yes. In the budget, the department is requesting its budget estimate to be $483,100 and in the Salary Details it is $439,904.

MR. WOODFORD: For Overtime & Other Earnings it is $28,300. For Permanent & Other Adjustments it is $14,896.

MR. E. BYRNE: What other adjustments (inaudible)?

MR. WOODFORD: I do not know what they have that one there for, Ed, to tell you the truth.

MR. MASTERS: That would be step progressions and that within their income.

MR. WOODFORD: Oh, yes. I am sorry.

MR. E. BYRNE: In terms of contractual employees, and I am speaking about the department generally - I don't know the number, I asked the question last week and wasn't provided with it - within the department, how many contractual employees would you have?

MR. MASTERS: Three or four.

MR. E. BYRNE: The entire department.

MR. MASTERS: Within the entire department, we would have three to four contractual employees; very few.

MR. E. BYRNE: Very few in that department.

MR. MASTERS: Yes.

MR. E. BYRNE: What about temporary and seasonal, given the nature of the department both on the forestry side and on the agricultural side?

MR. MASTERS: We have a permanent complement of around 400, but during the season we will go as high as 660 to 700. There is a fairly large discrepancy again, as you pointed out, due to the nature of the work we are doing. There is a big increase in the summer in seasonal and temporary employees.

MR. E. BYRNE: A question dealing with, I guess, the current land freeze in the Land Consolidation Program: There is a lot of debate occurring right now, Minister, within the industry - and, as you know, I represent a district where there are probably sixteen dairy producers in the area, within the electoral district I represent - a debate over granted land versus leased land. I would like to hear some of your thoughts on that debate. I can give you mine first, so you will understand where I am coming from on it.

Many years ago, government entered into the Land Consolidation Program, purchasing land, then leasing it back, but maintaining control over the land, in the future interest and the future protection of the agricultural industry throughout the Province. I know some people have talked to me within my own district saying: We believe we should be granted that land. Personally, I don't agree with that, but that is my own view on it. It would, in my view, go against the very reason why the Land Consolidation Program was set up.

Is the department looking at reviewing its policy on that, moving in a different direction on leased land versus granted land, or taking some of that leased land now and looking at granting it, giving outright grants for it?

MR. WOODFORD: We have had a committee set up on that for the past year, that has been looking into the whole situation of grant versus lease, which is very topical. You are right, it is one that has been garnering a lot of attention in the agricultural industry and especially in municipalities such as Kilbride, out in your area. They have had a number of meetings on it, and we have also had a public one that I attended down here at - I don't know where it was - the Newfoundland Hotel or the Civic Centre somewhere, on that very subject, with a lot of the farmers in the area, a lot of the people who were involved. That committee is still active and it involves people from your area as well.

MR. E. BYRNE: Who is on the Committee?

MR. WOODFORD: I think Hector is on the -

MR. MASTERS: It is a joint committee with us and the Federation of Agriculture. They have picked some out of that, so we have a number of people on it, and they have.

As the minister alluded to, we did have a large group where we brought in the lands people and other government departments at the Newfoundland Hotel last year. From that larger group, a smaller working group was formed and they have been meeting and hoping to report back on that, but it is in conjunction with the farmers and the Federation of Agriculture.

MR. E. BYRNE: I am just wondering why, and maybe you can speak to it, after twenty-odd years of a program of land consolidation which was brought into play, and a public policy issue of leased land for the protection of agricultural zones within the Province, at the same time maintaining Crown ownership and leasing it back to people who are involved in the industry and prosecuting that in the industry, why we would even consider, after millions upon millions of dollars being spent from the Treasury to purchase such land, granting some of that land to the very people who - we bought it for Crown purposes and leased it to them. Are there situations where that would be justified? I am certainly open to be educated on it, but it seems to me that, if we are going to move in that direction, to undermine the very reason why we brought in the Land Consolidation Program in the first place, and undermine, in my view, the future protection of lands for the exploitation and prosecution of the agricultural industry in the first place.

MR. WOODFORD: In your area, land, as you know, would go for around $3,000 to $5,500 per acre under the Land Consolidation Program. You are right, when government buys back the land to save from losing it and then, all of a sudden, gives a grant which is gone again....

I think where it came from is mainly outside of St. John's. What happened, you get a short-term and a long-term lease, which is a fifteen or fifty year lease for agriculture, and they spend a lifetime working it, cultivating it and clearing it. What happens is, they do not give you a farm. Crown Land gives you a piece of wilderness out of which you have to cut a farm. A lot of the arguments were there that there was no security. Although Farm Credit and some of the other lending institutions will lend on the basis of a lease, they were looking at something to pass down. They would always have that fear of losing their land in a lease. Say, for instance, someone had 100 acres and they cultivated eighty and then all of a sudden there was no security, they got sick, the terms and the conditions of the lease were not met and therefore they would lose it and their family would lose it.

That is where the concerns came from. There is a big difference between the land consolidation one that you are talking about here and elsewhere in the Province, working with the lease part of it. Like I said, you got a piece of wilderness out of which you had to cut a farm.

In here, under the land consolidation, you would buy, say, fifty acres, probably thirty was cleared - whatever the maximum on that would be cleared, probably thirty or forty acres - and yes, it would be worked and leased back. There is a difference there, there is no question about that. There are two different areas of the Province with different thinking.

MR. E. BYRNE: The principle is the same, though.

MR. WOODFORD: Pardon me?

MR. E. BYRNE: The principle is the same.

MR. WOODFORD: The principle is the same, yes.

MR. E. BYRNE: No matter where it is, it is still leased land or whatever the case may be.

MR. WOODFORD: Yes. Your arguments - you are right. The arguments for that, had it gone to - say, for instance, it went to a grant; there still would have to be conditions on it, that it would be kept in agriculture.

You are right. Can you imagine paying $5,500 for an acre of land, to get it from someone who is probably going to put it into something else - into, say, a housing development - use it for agricultural and then all of a sudden you grant it and then they have the right to sell it. You could lose it.

MR. E. BYRNE: I do not mean to monopolize, because when I am finished I am going to be finished, if that is okay with everybody?

CHAIR: That is no problem.

MR. E. BYRNE: In recognition of, your own recognition of, the differences between agricultural land in an urbanized setting like on the Northeast Avalon as compared to the demand for land outside of that, and particularly on the West Coast and Central Newfoundland and other areas, how does the department arrive at the dollar figure per acre of land? Is it an arbitrary figure you just talked about, $3,055 per acre under the Land Consolidation Program? How do you arrive at that amount?

MR. WOODFORD: Under the Land Consolidation Program, I will get Marty to refer to that one. (Inaudible) things on it, the details, but I think they would look at these certain areas, for instance Kilbride versus in around the St. John's or Torbay area, and the price of the land, what is going for housing development and so on.

I know outside, what they do is look at - say for instance if Farm Credit brought land, if a farmer sold land in the last five or six years, they take an average of the land that is cleared. Say, for instance, you had a hundred acres and there were fifty acres cleared on it, they would average it out. Instead of $1,000 an acre they would give you $500 an acre for what is cleared. You would get probably $500 an acre for what is cleared on that hundred acres. That is it. So you would get paid for the fifty acres. That is how they do it.

Usually out around our way now the difference is around $498 for cleared land and $211. That is the Farm Credit price now that they pay for forested versus non-forested, and out around other areas, Springdale, Grand Falls, pretty well everywhere out there.

The Land Consolidation Program: Do you want to refer to that one, Marty?

MR. HOWLETT: With regard to the Land Consolidation Program: As you are aware, when a person applies to the Land Consolidation Program, in the department there is a committee set up, and we have the funds. Realty Services does the negotiations with the applicant to sell the land.

MR. E. BYRNE: At Works and Services.

MR. HOWLETT: At Works and Services, yes. They do the actually negotiations.

MR. E. BYRNE: Does the committee - I don't mean to interrupt, but this is pretty freewheeling here.

MR. HOWLETT: Yes.

MR. E. BYRNE: There is a committee set up to deal with that, is there?

MR. HOWLETT: Yes, that is right.

MR. E. BYRNE: Who is on that committee?

MR. HOWLETT: I don't know the names, but we have a representative who sits on the committee, Realty Services, and Realty Services does the negotiations. We, as a department, do not do the negotiations.

MR. E. BYRNE: I know Martin Balodis is involved, I think, from Works Services. Who is on from Agriculture?

MR. HOWLETT: It would be Hazen Scarth or Grant Martin, one of our lands guys. Jeff Whalen, not Hazen.

MR. E. BYRNE: Is there another government appointee to that?

MR. HOWLETT: There probably is. Jeff is from us, Realty Services, and I think there is an independent guy who sits on that committee too. So, there are three.

MR. E. BYRNE: Appointed by government.

MR. MASTERS: Yes.

When the committee gets the application, they have Realty Services branch of Public Works that does the negotiation. We do not do the negotiation as a department.

MR. E. BYRNE: Why is that?

MR. HOWLETT: Because they are the guys with the expertise on lands. They look at lands in the area; what they are selling for; what has been sold in the area; the ones that have been sold for agriculture, both in the land consolidation, privately, and what have you.

MR. E. BYRNE: So they arrive at a figure somehow based upon -

MR. HOWLETT: Yes, they arrive at a figure based upon the number of acres that would be cleared on the land, how long it is cleared, how much is not cleared, how much is bog, how much is suitable to clear, how much is treed. There are a whole bunch of factors that come into play. Then they will come up with an average price per acre. It could be anywhere from probably $3,000 to $5,500 per acre. All those factors would be factored in and that will determine what it would be. It could be $4,000 or $4,500. That would be paid for every acre, whatever the average will be.

MR. E. BYRNE: Do you think that is cheap in the more urbanized areas of the Province?

MR. HOWLETT: I guess if you look at it and compare it to lands for probably housing, you might say it is cheap. As you know, when the zoning principle is done lands are zoned and the value applied to the land based on the purpose of the zoning. We have lands around St. John's, for instance, for heavy industrial, oil and gas, and so forth.

MR. E. BYRNE: I do not disagree with protecting agriculture land, by the way. I think you know that. I want to state that for the record. I am a big proponent of it myself.

MR. HOWLETT: Yes, I realize that. What would happen then when the average price is determined is to determine on the use of it that it is zoned for. You would not go in and come up with an average price for housing because the land is not going to be sold for housing.

MR. E. BYRNE: On development costs, et cetera.

MR. HOWLETT: The land is for agriculture or for oil and gas, or what have you. All those factors come into play. We have had a range of prices. Anywhere from probably $2,500 to $5,500 to $5,600 per acre.

MR. E. BYRNE: The reason I ask is because a couple of years ago - I know the Simmons Report went a long way to addressing many of the concerns of private landowners on the Northeast Avalon - not all of them, but some of them. I still believe there is a significant opportunity for the protection of more agricultural land on the Northeast Avalon. Land base is what is going to make agriculture and dairy producers - access to land base and having it will mean the difference in them surviving or not surviving as commercial entities and viable commercial entities forever and a day.

I know a couple of years ago a group of people who owed - private landowners came to see me looking for support because they felt the prices being offered were not reasonable enough, I guess is the best way to put it, and talked about agriculture stymieing this and that. I said to them at the time: Look, why don't you sit down with the producers in the area? You are not diametrically opposed. What you want is what maybe they want. If you want a fair price for your land, or a fairer price for the land than what is currently being offered - I mean support from the industry will be there because they want the land too.

Have there been any overatures made in terms of assessing - because some of it is pristine, pretty well right on the doorstep, that could be developed, and with mounting pressure as time goes on - and you have seen it, I am sure, Marty, and I know others have as well, in terms of the last twenty years, the continued pressure - that maybe there is an opportunity to clear up what is remaining within the freeze, even if we have to be a little bit more reasonable in terms of the prices that we are offering. Would you see that as a possibility?

MR. WOODFORD: Some people might, but like you say, there may be some farmers out there who are willing to pay pretty well the same price. When they look at the fact that government will pay it, whether it is $3,000, $5,000 or $10,000 and then lease it back to them, I suppose, being prudent and nipping the dollar and everything, they look at and say: Well, why pay out this upfront? I carry the loan or the mortgage on it.

MR. E. BYRNE: I am talking about the department being more reasonable, I guess, in terms of prices - from a point of view of being able to get within its own shop larger tracks of land.

MR. WOODFORD: Larger tracks and then -

MR. E. BYRNE: The problem is this. I will give you a legitimate case. A person who has come to see me - with thirty-four and thirty-five acres - but cannot do anything with it because it is protected in an agricultural zone. If they do not lease back to a legitimate and bonafide agricultural operation, the City of St. John's is going to zing them, from a tax point of view. They would never be able to afford it. So they are sitting there and saying: Well, this land is mine. I own it. It belonged to my father and grandfather. It is thirty-four acres and it is just as well that I did not own it. I cannot develop it. I am in a position where unless I lease it to a legitimate agricultural operation, I am going to be taxed on it from the municipalities point of view, and I will never be able to afford to pay the taxes on it.

In terms of fair consideration, it does not seem to be that those interests - I mean, if government has an absolute right to zone for agricultural purposes - I, as one person, support that in terms of the larger public policy issues surrounding that, but, at the same time, there has to be some recognition of what - once we infringe upon and want to exercise that right, and we are infringing upon someone else's private property rights, then, I guess, the legitimate question is: Are we compensating that person or that group or class of people fairly?

MR. WOODFORD: Yes.

MR. E. BYRNE: Twenty-five hundred to $5,500 an acre on the Northeast Avalon, given the proximity to that piece of land being open for development, and many developers looking for it, as you know, many developers who would develop it tomorrow, I guess in terms of the ultimate protection of the zone and the land in it, could we not be a little bit fairer in terms of the prices that we are offering to people?

MR. WOODFORD: That question has come up from time to time, and some people say, well, boy, you are paying too much for it; but, like you say, every day it is getting more expensive, especially in that area. That is something that we are going to have to take a serious look at out there.

By the way, that Simmons Report, that ten-year - that is up this year. It has to be done again, reviewed, but there is an awful lot of pressure out there. As you say, to take out this piece, and take out that piece, and I want to develop - there is an awful lot of pressure.

MR. E. BYRNE: We are not talking about a lot of people.

MR. WOODFORD: No, not a lot of people.

MR. E. BYRNE: That is the other side of it. If we chose to do it now, we really could, forever and a day, on the Northeast Avalon, with the land that is remaining, solve it. When the land freeze first came into effect, I think it was Ed Maynard who was the Minister of Forestry and Agriculture in 1972, it was supposed to be a temporary measure until they sorted it out, and it has kind of evolved into still where it is today.

I am not different than yourself on it, other than speaking from a proponent of the industry, from someone who supports it, that we have an opportunity to clear this up, that it will be bothered anymore, that pressure will not be there because it will be in the Crown's hands and not in some private hands.

The only issue outstanding, as I see it, and I have worked with people in the area on it, is the issue of: What is fair compensation? I do not think anybody reasonable would expect thirty-four acres divided into half acre lots and give me $40,000 per half acre lot. No one is expecting that, that is foolishness, but for undeveloped, unserviced agricultural land, $2,500 (inaudible), people were getting that fifteen years ago, twenty years ago. Maybe it is time to review what the department is doing in that respect. You do not necessarily have to pay it out all in one lump sum. People would be willing to take it in increments too, I think.

MR. WOODFORD: You are right in regard to the pressures out there now, especially with the new 31 million litre industrial milk quota. I mean, there are more pressures on for land. Like you say, the cost of production now for feeds is the biggest element in that. It is something like 26 per cent or 27 per cent, so it is an area that we are going to have to take a serious look at, and other areas in that, too, with regard to the Crown part of it, that we can accommodate them.

MR. E. BYRNE: It is an important public policy issue. I mean, last year we entered into - the department, along with the Department of Finance - a drought assistance program. The fact of the matter was, we have enough land base, if it was developed properly, that we could grow more than our own needs, cut costs for producers in terms of - you know, there has been elimination of the feed freight transportation subsidy. When we get into a position, or producers get into a position, where they have to import feed, it is the bottom of the barrel. It is junk, basically.

MR. WOODFORD: That is right.

MR. E. BYRNE: What has to be added to that just to keep the quotient and the quota for milk production, and where it should be in terms of quality, raises costs; but if there was enough access, or more access, where people could really be self-sufficient and then some. Because I know at that time of year when government entered into the drought assistance program, the only place in the country, really, was parts of Saskatchewan where there was feed available. Everybody in the country experienced the same dry climate for the whole year, so that was a tough summer.

We could get to a position, and it is not a quantum leap to think that it could not be done fairly quickly, where you could provide enough land base for people to grow enough to be self-sufficient and not having to import.

MR. WOODFORD: And it is the biggest cost. They are doing some real good things out that way, too, with regard of the corn production. I mean, really, really good enhancement of work.

MR. E. BYRNE: I was down in Codroy Valley the summer. See the corn down in Codroy Valley. You know, we should send a CBC camera down to picture it. No one would be believe it. It is unbelievable.

MR. WOODFORD: Yes.

CHAIR: The Chairman wants to interject.

It is a good spot. The Codroy Valley is a beautiful spot. I just want you all to know that.

Thank you very much, Mr. Byrne.

MR. WOODFORD: (Inaudible).

MR. E. BYRNE: The stuff at Walsh's farm on Pearltown Road -

MR. WOODFORD: Kevin Williams and (inaudible), what they are doing is excellent. That is the biggest cost of production, the feed. That is our biggest cost. We need a lot of land. I think we need something like, I do not know if it is 7,500 hectares now or 15,000 in order to accommodate -.

WITNESS: Fifteen thousand acres.

MR. WOODFORD: Yes, 15,000 acres to accommodate the new 31 million litre quota, if they get it. We only have fifteen years to produce it. Two of them are gone.

MR. E. BYRNE: Yes, we have to move on it.

MR. WOODFORD: We have to move on it.

MR. E. BYRNE: It is there. The land is there. We just have to move on it.

MR. WOODFORD: We are looking at the inventory part of it, Ed, on that one, and also the Crown; there is some Crown in that area out around the Cochrane Pond area. We are looking at that, to try to get the boys into something out there that would enhance their whole business.

MR. E. BYRNE: We should move on that out around the Cochrane Pond area before government, other departments, scoop it up for other public policy purposes, because there is pressure on it for that too. That needs to be done quickly.

MR. WOODFORD: Yes, exactly.

MR. E. BYRNE: That is where the growth of the industry is.

MR. WOODFORD: That ten year review is up now, too, and that is another area, when they do the review, that there are going to be some pressures. I know in this department I get them every day of the week from so-and-so who wants to do this and do that, but they are certainly not in agriculture.

MR. E. BYRNE: One final question.

You referenced the industrial milk quota and the price, I guess, that the national supply program pay for getting Newfoundland and Labrador involved in the national milk strategy and, I guess, possibly closing a loophole from a free trade point of view and world trade.

I am told that we have opportunities for - and you are aware of this, too, I am sure - cheese production, yogurt production, cottage cheese, speciality cheeses, and that there are possibilities within the Immigration Investment Fund to pursue some of this. You can correct me if I am wrong at all on this, but I am also told that getting the Department of Industry, Trade and Technology to be more aggressive in pursuing that has been a challenge; I guess I will put it that way. Any comment on that whatsoever?

MR. WOODFORD: I know that the dairy commission has - the Newfoundland Dairy Farm Association - has met with Industry, Trade and Technology on that very subject. They are looking at it and they should have - because there are people over there who were in the agricultural industry before, like Phil McCarthy. They are looking at it. I do not know how successful they are going to be with it, but there is a possibility of accessing some money there. They were looking at it primarily from a land enhancement point of view. For instance, you are going back to the land part of it, either buying the land or clearing other land, getting it ready so to speak, so they can get into more production with regard to the industrial milk quota. That is the approach they have taken.

On your other one with regard to the industrial milk, like cheeses, yogurt and things like that, there are people looking at that now by the way. Now, other than the Central Dairies and the Brookfields of the world, there are other framers, two or three farmers probably getting together and doing things. So there are people -

MR. E. BYRNE: I know, we have a real big advantage. We are the only Province in Canada that has an industrial milk quota of 31 million litres available to us - to be able to leverage that. We are on the doorstep and the trading partner with the largest market in the world. There are other countries who are interested in getting a way in, an access to that market, and this is one of them.

MR. WOODFORD: Oh, yes.

MR. E. BYRNE: How we leverage that - there should be an all out, flat out, aggressive strategy on the one hand, but pursuing it relentlessly on the other, because that is where real economic opportunities exist; particularly in rural Newfoundland with the quota. That is where the opportunities will enhance, in terms of government's economic strategy for - as part and parcel of its economic strategy. The potential for this is twice the size of Voisey's Bay in real employment, real jobs, year over year, sustainable forever and ever; and no one talks about it.

MR. WOODFORD: Forever and a day, yes.

That 31 million would double the production of milk in the Province. That is what it is today.

MR. E. BYRNE: And double the workforce.

MR. WOODFORD: Yes.

MR. E. BYRNE: Okay, that is all I have.

CHAIR: Thank you, sir. Thanks, Mr. Byrne.

Mr. Hunter.

MR. HUNTER: I would just like to get into some of the areas of the budget, and I will ask questions to the appropriate people opposite there.

Perhaps I should make some comments, Mr. Chair, before I get into that. I will start with forestry first, I guess, seeing forestry is an area that I am most familiar in Central Newfoundland. I understand, Minister, that you are trying very hard, I know, to find a solution to the problem in Stephenville with the wood supply out there. Do you foresee any problems with respect to the Grand Falls-Windsor mill? If you find resources on the Island, would there be any impact on the Grand Falls mill with respect to the two paper machines there? Do you see any problems arising there?

MR. WOODFORD: No, I do not see any problems arising from the Grand Falls situation, because they have their AAC pretty well for that mill. There is no fundamental change really with the Stephenville mill now and what was there all along, except for the fact that they are saying they have no supply. They never did have a supply for the Stephenville mill. They were sort of guaranteed a twenty year supply but that was twenty-three, twenty-four years ago.

The Grand Falls mill, I do not see any repercussions whatsoever. On the Stephenville one, we have a task force set up now to look into it from Abitibi and government. In fact, there are more meetings this evening on that very subject, to look into the possibilities of what could be done there. Really, on the fibre side, we can increase the AACs in the Province. The Labrador wood, there is a possibility but the only thing you are going to get out of Labrador, as far as I am concerned, is the residue because everything that should be done with the resource in Labrador should be done, and the value-added and whatever, can be done there, should be done and then the residue come back to the Island. Like, for instance, the chips or the pulp wood that is no good for the saw lines or something like that. Recycling, they could get into recycling. They could get into - less than the cost of Stephenville, say co-generation. We just opened the one in Corner Brook on Friday.

Getting back to your original question, the Grand Falls one I do not see - they have their own AAC out there. Based on the production they have there, they should be safe and sound. Stephenville is the one that is in jeopardy right now. We are doing everything in our power to try to access wood, whether it is offshore, recycling, co-generation, whatever. We are working on that with them to see if there can be a resolution.

MR. HUNTER: I have had calls from mill workers actually in the mill at Grand Falls-Windsor, they are noticing wood leaving the yard going to Stephenville. They were quite concerned that if this is wood designated for the mill in Grand Falls-Windsor, then why is it going to Stephenville? Wasn't that cut under a permit for the Grand Falls-Windsor mill? Are there any regulations in the department to say that this wood cannot be trucked from one yard to the other? These people were told that this wood was en route to Stephenville from the yard in Grand Falls-Windsor. They want to know - this was the question they wanted me to ask you. Are there any regulations saying that that wood could not be trucked under the permit of the Grand Falls mill to Stephenville?

MR. WOODFORD: That is a fairly common thing under the inventory part, under AAC. If they are only going to use 500,000 cubic meters in the Grand Falls mill and they are up to production and so on, and they have, say, 50,000 or 100,000 left - as you know, in the last five years Abitibi left something like 1 million cubic meters of their AAC on stump. If they want to ship it to the Stephenville mill, that is their prerogative, because that is their AAC for the year, the 602,000 or whatever it is that they got there. It is within their AAC, they are not going over it, so they have a choice as long as the production is up in that Grand Falls mill.

MR. HUNTER: Workers want to know: That AAC is designed for the Grand Falls mill and if it was left on stump or if they decided to cut it and send it to Stephenville, is there any regulation saying that they cannot cut that wood and ship it to Stephenville? That is what the workers want to know. As far as they are concerned, that AAC and the permits that the mill got are for the Grand Falls mill. That is what they think it is. They want to know: Is that so? Can Abitibi cut that wood and ship it to Stephenville if they want, as part of their AAC?

MR. WOODFORD: It is within their AAC and what they do with it in their operation is entirely up -

MR. HUNTER: There is no policy, no legislation, saying they cannot do it?

MR. WOODFORD: To say they cannot, no. As you know, in that agreement last year, they have to keep up the production at the Grand Falls mill.

MR. HUNTER: What they are worried about right now is, they are having a lot of downtime and by having downtime if the woods keeps on getting cut, then what is the company going to do with the wood? They might encourage downtime in the Grand Falls mill so that they will have wood for Stephenville. That is what the workers there are surmising and they are expecting that is what is going to happen. They are saying: This mill had an allocation of wood 100 years ago and Stephenville doesn't. The workers in Central are saying that wood is for the machines here and if the machines are down they don't cut the wood. That is what they are saying. They wanted to know and they were asking me the question.

MR. WOODFORD: There is always the fear out there of that, especially with the other mill there. There was always a fear of that. As you say, we have that agreement with them now and they have to keep the production up. They cannot violate that agreement with us. If they do violate that agreement, well then they are going to have to answer for it.

MR. HUNTER: There is still a fair bit of wood on the West Coast yet that is not being cut this year. I know one contractor who just went out of business. Bruce Budgell went out of business and I think he has a fair amount of wood that he was supposed to cut this year for the Stephenville mill, and that wood is not being cut now because he has gone out of business. It has not been allocated to anybody else. Would your department try to find a way to make sure that his quota of wood for the year will be cut to keep the Stephenville mill going for those twenty-three days? I understand he has a large quota of wood to cut for Abitibi over around the Burgeo road somewhere, in that area somewhere. Have you looked into that to find our why they are not allocating that permit, that allocation wood?

MR. MASTERS: Yes, they did have their contract, Mr. Budgell, that went into receivership or had some business troubles I guess this year. They have been working. There are other contractors extra. I would be surprised, given the situation at Stephenville, that Abitibi would undercut their limits this year. I am not saying they would not, but I would be surprised. As the minister alluded to earlier, going back the past ten years, they have on occasion undercut their limits.

I want to go back to your question of wood moving from Grand Falls to Stephenville, if I can. That is a fairly common thing. All the wood off the Bonavista Peninsula in the Clarenville area is trucked into Grand Falls. It is just easier than trucking it to Stephenville, although that Crown land wood, in theory I guess, goes to Stephenville. So it gets trucked into Grand Falls. It is not uncommon, particularly in the spring of the year, to see a lot of trucks leaving Grand Falls and trucking wood into Stephenville, or vice versa if that is where it is, but normally it is east to west. So they have enough wood on their own limits to keep Grand Falls going. Then all of the Crown land wood in Central and Eastern Newfoundland also flows into the Grand Falls mill and they take some of the wood off their western limits and move it towards Stephenville. It just makes an operational sense for moving wood around.

MR. WOODFORD: They have around 50,000 cubic meters today out on the West Coast.

MR. MASTERS: On the West Coast, yes.

MR. WOODFORD: Virtually, all the rest is central and east.

MR. HUNTER: Yes. I have a few complaints also from some of the contractors complaining that a lot of the larger logs are not being accessed by the sawmills. They are coming back and saying the logs are too large. They are too big to be handled by certain sawmills because of the technology they have in their equipment. These logs are going back to the paper mills to be used as pulp wood. Have you encountered anybody specifically concerned about that, that these bigger logs are coming to sawmills and they cannot be handled so they are going back to the paper mills? That is a crime to let that happen today with these larger logs.

MR. WOODFORD: Yes, it is, but I am getting the opposite, to tell you truth. They are telling me that they will not pick the logs out for them. They will not give them the proper size logs, especially the sawmillers in central and east. Abitibi will not give them the good logs. They just bring them in and (inaudible) stuff.

MR. HUNTER: I am not talking about the oversized logs, you know.

MR. WOODFORD: Yes, I know, the oversized. But there is no such thing as oversized for some of those mills. They can saw them. Now some of the mills, like further east, like Bloomfield, they do not mind the small run of logs, but in a lot of cases the sawmillers out there are complaining to me about bush run stuff. They are just taken out of the bush in small, tiny logs but some of the mills can accommodate it.

MR. HUNTER: Yes, there is a certain amount of logs they can take but -

MR. WOODFORD: Yes, I know.

MR. HUNTER: - some of these logs, with the mills they have cannot handle the great, big logs.

MR. MASTERS: I could address that. It is a very small proportion, but you are right, I have seen it in the Glenwood operation where they are geared for stud wood, for the most part, smaller dimension trees. If you look in their operation you will see a few tractor-trailer loads of these really big logs. What we did last year is we made an arrangement with Northco, which is in Baie Verte, and had the logs trucked up there because their sawmill cannot handle the much larger dimension. I have not heard tell of any going to the pulp mill but they certainly would have been seen leaving the sawmills heading west, but we did make arrangements for Northco to saw those. It is much more in the direction that the minister indicated where the sawmills are saying: This stuff is too small, as opposed to it is too big. But there is a proportion like that, you are right.

MR. HUNTER: Perhaps I should get into some of the agricultural stuff. I know under the new APF Agreement, Mr. Howlett - are there any monies available to continue the work at the feed mill for Stephenville? It has been a concern now that this - they are anxious to get this finished, and with the season coming up on us fast, to get the feed into that mill. It seems to be sort of slowed down now and they want this up and running as soon as possible. Is there any extra funding around that they can get to finish off that feed mill project?

MR. WOODFORD: My understanding with the feed mill, there is quite a bit of agricultural money gone into that.

MR. HUNTER: Yes, there is.

MR. WOODFORD: My understanding, there is supposed to be enough money there to finish it, unless there is something that come up lately that I do not know about. I know that under the different programs there they got monies to finish that feed mill. So if there is anything new there that it is not finished, it is news to me, Ray.

MR. HUNTER: I spoke to some of the producers on the West Coast and they said a commitment has not been made to allocate the money to finish the project this spring. Are there any concerns on that?

MR. WOODFORD: No, I have not received anything new on it. I was talking to Bruce Simmons, who was really involved in that, he is from - just before you get to Corner Brook there. He has a layers operation there, and dairy. I understood that that was supposed to be finished. I can check it out for you. I will check it out and see what the status of it is.

MR. HUNTER: Actually, one of the Deer Lake producers I was talking to at the federation AGM was concerned that the money would not be there fast enough this spring to finish it. They are hoping to get this up and running for early shipment to feed coming in.

MR. WOODFORD: Yes, we will check into that one for you but my understanding was they had the funds to do it. I will check it out for you.

MR. HUNTER: Under this APF Agreement, is the criteria set down yet for where the money is going to be spent with respect to farm development, land development, and stuff like that? Is there any criteria set out yet?

MR. WOODFORD: No, there will be an implementation program there. The APF is not signed yet, officially signed by the feds, but it is pretty well agreed on. The $3.9 million from the feds and $2.6 million from the Province this year, which is the best agricultural agreement that was ever in this Province, to be honest with you, for the next five years. As you know, the old Safety Nets agreement was finished March 31.

This agreement pretty well covers everything, to be honest with you. We have, as far as I am concerned, enough flexibility in that agreement. It was tough slugging with the feds because they do not want, as you alluded to, the land part of it. They did not want that involved at all, but under the five pillars in the agreement - for instance, the environmental part of it, the renewal, science, and business risk management and so on - we have enough flexibility there, I think, to cover pretty well every aspect of the agricultural industry in the Province, from the small right on to the biggest. Even some - and I am a bit hesitant about talking about it - in the supply management area. As you know, under the Safety Nets agreement supply management was not mentioned at all - or it was not eligible, I should say. Even in this one, I think we might be able to, in some of the programs there, enhance some of the supply managed areas.

MR. HUNTER: What type of emphasis will your department be putting on berry production, like blueberries, cranberries and stuff? Will a lot of that funding come from that program?

MR. WOODFORD: It did before, under Safety Nets. As you know, some of the cranberry production was enhanced. We had our first commercial harvest this year, out in Kevin's area. It was fairly successful. The blueberry industry, the enhancement fund for the blueberry industry, we had that and I think we will be able to access funding under this one for that. We are talking to a fellow in your area, a fellow by the name of Jeff Milner. A letter went out to him, I think, just yesterday, telling him just that. Once we get the agreement signed, we should be able to accommodate the blueberry.... All those sectors, the berry sector especially, are areas where we can enhance the agricultural industry. Those are areas where, pardon the pun, it can really grow.

MR. HUNTER: There is a lot of interest in Central now.

CHAIR: The minister has a good sense of humor, I must say.

MR. HUNTER: There is a lot of interest in Central. I think there is another fellow trying to get one going near Buchans there, to get an operation going there. He was wondering if the criteria would be that he could access funding to get his place up and running. He has only just started. I wasn't sure, because I did not see any criteria only on the APF program to say that they would be funded for development.

MR. WOODFORD: I do not see any reason why not, Ray, to be honest with you. I do not see any reason. Why shouldn't they?

MR. HUNTER: I guess we will get into some of the Estimates in the Budget. There are some areas there that I would like to question you on. The Vice-Chair has already questioned some of it there.

On section 2.1.02.06. Purchased Services, Operations and Implementation for Forest Management, could you tell me what those purchased services would be for Operations and Implementation?

MR. WOODFORD: I am sure that has to do with the move to the -

WITNESS: Maintenance (inaudible).

MR. WOODFORD: Maintenance, is it? I will get this - 2.1.02.

MR. HUNTER: There is $355,300 budgeted, estimated.

MR. WOODFORD: Under 2.1.02.06., that is maintenance and repair, and vehicle and machinery rentals, and - contracting of services such as snow clearing of forest access roads, services for road grading, ditching, spreading of pit run and crushed aggregate and so on, culvert installation and washout repairs.

MR. HUNTER: The next question I was going to ask, would that include vehicle leasing and stuff?

MR. WOODFORD: Yes.

MR. HUNTER: Is there anywhere in the budget there, instead of leasing vehicles, that you replace some of the vehicles this year? Because a lot of the vehicles now are ten years old, or more, and some of them - I know I have talked to a lot of the technicians and they are finding that a lot of the vehicles are just not dependable.

MR. WOODFORD: Go right to your next one, Ray, 07. Property, Furnishings and Equipment. That would cover that.

MR. HUNTER: That will one cover - okay, that was the next question I was going to ask.

MR. WOODFORD: That is the one that will cover -

MR. HUNTER: So, there is a plan to replace some of the vehicles this year?

MR. WOODFORD: Yes.

MR. HUNTER: There was a big difference last year. You spent $69,500 and then this year you are up to $549,700. Most of that would go into the replacement cost -

MR. WOODFORD: Yes, that would be the one to cover that.

MR. HUNTER: Are there a number of vehicles that you have in mind to replace?

MR. WOODFORD: We would like to replace pretty well all of them, to tell you the truth. We would like to, but -

MR. TAYLOR: (Inaudible).

MR. WOODFORD: What?

MR. TAYLOR: I know one (inaudible) needs to be replaced.

MR. WOODFORD: Now that the season has ended, I think most of that will be going into trucks.

MR. HUNTER: We had concerns last year in the Bishop Falls regional office. They had one truck for - I think there are five or six during the fire season. There was one truck available and they had to take turns to go out in the truck while the other ones were sitting by, could not do patrols and whatever. The truck that they had was really old, even though some of the management vehicles were pretty good, fairly new, but when you get down to the workers, technicians, and the fire patrol people, they could not understand why there were so many of them there with one vehicle. If you are going to have six people, you should have at least two trucks with three in a vehicle.

This year, I guess, you will be looking into that and finding out -

MR. WOODFORD: We will be, and we have had complaints about that. We know that we have some vehicles that should be replaced. It is trying to get the money to do it all, to be honest with you. We know that out there, there is definitely a need for some new vehicles, no question about that.

MR. HUNTER: Seeing, too, that some of the vehicles of some of the management - I mean, they were driving extravagant vehicles compared to what some of the lower workers were driving. They were driving ten-year old pickups that were falling apart. Those in the top management jobs were driving $50,000 vehicles, extended cap, full (inaudible), dressed up and everything. They were quite upset over that. Why would they have to drive these vehicles when the top management were driving the best?

MR. WOODFORD: I had some reports about that last year. We checked it out, and with regard to the pricing of the vehicles they got them at pretty well the same price as what they had gotten the others because of the package deal and so on. I have never heard about the management - I have heard it, I suppose, but I haven't seen or witnessed it, that some of the management are driving around in those vehicles and they are parked, and the person on the road who must depend on that vehicle is out driving around in something older. If that is so, I would like for it to come to my attention.

MR. HUNTER: Well, it was brought to my attention, that some of the management people were driving long distances, commuting back and forth to work, and even when they were not on call they were still driving an hour's drive from work to home, when all the rest of the employees had to bring their own vehicles to work. They were pretty upset over that. This was going on daily, people driving, I suppose, eighty and ninety kilometres to get to work in a government vehicle, and even when they weren't on call they would take the vehicles home with them. That was a bit of a concern that some of the workers were bringing to my attention.

MR. WOODFORD: I can understand why they would be upset, to tell you the truth.

MR. HUNTER: That might be a way to trim some fat off the budget, on vehicles there.

On the next page, 2.1.04, Capital, Resource Roads Construction, there is also under Purchased Services there an amount of $3,683,500 estimated for this year. Could you tell me, Minister, what that Purchased Services would be?

MR. WOODFORD: That is primarily for the resource road construction. That is up this year, up all over the Province, and we are hoping to be able to do more work with access roads both on the Island and in Labrador this year. As you know, the more access roads we have in the easier it is to access timber.

MR. HUNTER: So that would be for that purpose, that new extra amount of roads you are putting in this year.

MR. WOODFORD: Yes, and that will be done all over, Ray, across the Province, both on the Island and in Labrador, like I said, to enhance the forestry industry and to be able to make it easier and more accessible to people to get it. We got an increase this year and we had an increase last year in that. As you know, a couple of years ago there was only $2 million in that, or $2.2 million, so we got it up pretty good, with that and the agricultural part of it.

MR. HUNTER: What other services would be included in that, besides that purchased service? Would there be any other major services?

MR. WOODFORD: No, all forest access roads and things like that. There is nothing else in that. There is no equipment or anything in that, I don't think, is there?

WITNESS: (Inaudible).

MR. WOODFORD: No.

MR. HUNTER: Okay.

Up the page there on Silviculture Development, 2.1.03., also for Purchased Services, 06., the $4,636,800, what would those purchased services involve?

MR. WOODFORD: I would say it is all to deal with the spray program.

WITNESS: No, (inaudible).

MR. WOODFORD: Oh, that is right, that is the contract.

WITNESS: Page 116.

MR. WOODFORD: Yes, page 116, under 06. Yes, that is contract services for the various Crown and silviculture projects. For instance, you go out and you contract people to do the silviculture, to work the planes and the helicopters or what have you. It was all scarification equipment, and if you needed anything with regard to doing silviculture, whether it is any kind of -

MR. HUNTER: Any Wooddale expense come in under that?

MR. WOODFORD: What?

MR. HUNTER: Any expense at Wooddale Tree Nursery come in under that?

MR. WOODFORD: I would not say.

WITNESS: Yes, it does.

MR. WOODFORD: Does it? Oh, yes, the nursery alarm, miscellaneous items for (inaudible) in conjunctions with nursery tours (inaudible).

MR. HUNTER: That do not include the expansion, though, does it, at Wooddale?

MR. WOODFORD: Would that include the expansion?

WITNESS: Most of the expansion is paid off.

MR. MASTERS: Wooddale is in the silviculture program, as it always has been, so it is all included. Most of that service, the $4.6 million, would be contract planting, contract pre-commercial thinning, but the operations of Wooddale are part of that cost too. With respect to the expansion, most of the capital cost of that has already been paid down but the operating part of that would certainly come out of this particular account centre.

MR. WOODFORD: It would not be the capital. By the way, we have expanded that, as you know, to go from $7.5 million to $10 million this year.

MR. HUNTER: Under the heading 01. Salaries, $2,342,200, does that include the salaries at Wooddale too?

MR. WOODFORD: Yes.

MR. HUNTER: How many new job positions are you expecting to increase this year with that new expansion?

MR. WOODFORD: I do not expect there to be any there. There might be some temporary. You can elaborate on it.

DR. NAZIR: Most of the job expansion will be giving longer employment to the existing employees because we will be producing more trees and there will be more shapes of trees in the greenhouses so they will get a longer employment period as compared to the forest. There will be, I believe, around three people more.

MR. WOODFORD: The people who are there will get more weeks.

MR. HUNTER: I was told the other day that there would be six new positions, but they do not know if they are going to be permanent or part time.

MR. WOODFORD: Six new ones?

DR. NAZIR: Probably three would be more like longer term permanent and three could be temporary.

MR. HUNTER: That would come out of that salary portion of -

MR. WOODFORD: That would come out of that salary vote, yes.

MR. HUNTER: Minister, on 2.2.02.03. Fire Suppression and Communications, Transportation and Communications, last year it was budgeted for $761,600 and there was $1,916,600 spent, revised. Could you tell us why this increase occurred?

MR. WOODFORD: I will get Allan to go over that one now, but, as you know, last year.... With fire suppression we cannot - I know that I said in my statement that it was pretty well going to be the same as last year, but we cannot predict fire. In the last few years we have been pretty lucky. In1999, as you recall, the fire in Badger, we drove everything - we were spending $500,000 a day. Just imagine that compared with what we did last year on fire suppression. We have a vote in there, and we have an increase in the vote this year, but we cannot really predict it. It is so unpredictable it is not even funny. I will get Allan to elaborate on the details.

MR. MASTERS: Just to follow up on the minister's comments, our base salary or estimate for 2003-2004 is basically a man-up salary. That is what it costs to get everything in place for the fire season. We could handle some small fires with that, but as soon as we get into any kind of a major fire situation we have to come seeking additional funds. You will notice this year there is an additional $200,000 in the man-up, and that was because of some reclassification issue within the firefighter ranks last year which required that and we were successful in getting it. Basically, that is just a man-up budget and, as the fires happen - that is why you get wide discrepancies each year if there are any amount of fires.

MR. HUNTER: Wouldn't the higher costs come in Purchased Services under Forest Protection Services?

MR. MASTERS: No. On fire, our biggest cost is aircraft, whether helicopters or -

MR. HUNTER: You would rent helicopters. Wouldn't that come under Purchased Services?

MR. MASTERS: No, that is under Transportation and Communications.

MR. HUNTER: So, a lot of the helicopter hiring is done under that, and that $1.9 million (inaudible).

MR. MASTERS: Oh, very much so. I would think, out of that figure, I would say 90 per cent of it was probably aircraft, but it would be in that 80 per cent to 90 per cent range.

MR. HUNTER: Would you still hire under Purchased Services, too, if you still had (inaudible).

MR. MASTERS: No, the Purchased Services you see there are really the maintenance of equipment. Like, if you have a major number of fires, you have to repair pumps, you have to repair everything, so that is where Purchased Services come in.

MR. WOODFORD: Under that man-up, Ray, there is around 100 or 103, is it -

WITNESS: Firefighters.

MR. WOODFORD: - firefighters that we hire back, usually in May, and usually they work until around September, so you have to use that salary there mainly for man-up. Now, that could increase. It depends on -

MR. HUNTER: That $2 million in the Salaries portion there, that would be for the extra man-hours?

MR. WOODFORD: Yes, exactly.

MR. HUNTER: But the Transportation would not include salaries for -

MR. WOODFORD: No, no, that is up in the salary (inaudible).

CHAIR: Mr. Hunter, before we move on, we have some coffee. What do you say we go for about ten minutes, until10:30?

MR. HUNTER: My colleague would like to ask a question first.

CHAIR: You want to ask a question first? Sure.

MR. TAYLOR: (Inaudible), if that is alright?

CHAIR: Okay.

Trevor Taylor.

MR. TAYLOR: On the Fire Suppression and Communications, I listened to the reasoning for the wide fluctuations and it is perfectly understandable. Does the department have any - talk about forecasting now. You know, they missed a storm down in St. Anthony the year when we all got buried, so I don't know that I would put a lot of dependence in it a lot of days. Nevertheless, there is some suggestion from Environment Canada or various meteorological services suggesting that this year for the Southern Island portion of the Province anyway, with the exception of the Northern Peninsula - which is no surprise, and Labrador - that we can expect probably a hotter summer than normal.

I was going to ask this question, but Ray started to get into it. Is it prudent to basically budget a similar amount to last year's, given what happened last year and given that we are expecting probably a climatic - weather wise, we are in a situation very similar to last year also. Would that be a prudent approach? Wouldn't it be more reasonable to budget a higher number for that? Or do you have a contingency somewhere that you draw on from within the department? I know you say that if there is a major fire you have to go looking for additional funds.

MR. WOODFORD: Yes.

MR. TAYLOR: Is it to go looking within the department, move it around from other heads or special warrants?

MR. WOODFORD: Usually, Trevor, with the fires - as you say, you cannot predict that stuff. If you go back - we have been pretty good, like I said, the last four years since 1999. We have budgeted pretty well the same. Even in 1999, the budget was pretty well the same, except for when it happened - you would naturally make sure that the department is covered for it because it is an expense and you have to deal with it. You cannot go back that day and ask - and don't spend anything and don't fight a fire because you do not have the money.

Usually the basic wage is there, the basic vote is there, and if you go over it - you usually go back. What happens, instead of going back and back and back, if you go over it, then you go back in September or October after the fire season and ask for a special warrant to cover that, whatever it is, if it is $500 or $2 million. To go asking for a vote before is - like you said, last winter was supposed to be a nice winter, too, under the Almanac. According to the Farmers Almanac: Oh, my, it is a wonderful winter. If they keep on predicting that, we will just go the opposite because it was the coldest and snowiest winter we ever had. As you alluded to, that storm in St. Anthony this winter as an example.

If you start putting money in the vote, say $5 million, and you will not spend a million - it is hard enough to get it out of Treasury Board when you know what you have to spend it on, to tell you the truth. So if you go in for something like that: we might spend it; you can forget it. Hang up your hat! But we will look after it and make sure that the fires are looked after.

MR. TAYLOR: Oh, yes, I am sure you will.

MR. WOODFORD: Yes, but I see your point.

MR. TAYLOR: I did not mean to suggest that you would not because it was not there. I was just looking at it from a budgeting and anticipation perspective, I suppose, given that the forecast is that it is.

MR. MASTERS: I will just step in for a comment, if I could.

I had a climatologist come to the Province and give us all predictions on where our weather is headed. Of course, everywhere in the world it is warming up, except for this nice ring from Newfoundland to Iceland. Over the next fifty years it is going to get two-and-a-half degrees colder than what it is right now. I do not know what that means in this state but it really is impossible to tell. We are having a late spring. That is going to help because there are two critical times in the fire season. One is spring, when you do not have the green up right away and you have that dry. Once you get into the green-up you are okay. Then as the plants start to shutdown later in the season there is another critical period. Hopefully, we can get past the spring critical period, but who knows? The weather in this Province - tomorrow it could be something different. It is shaping up to be good but let's cross our fingers.

We do have a lot of bug kill stands, particularly up in your area. That just adds to the fuel mass. There are so many pros and variables within this, it is really difficult. We have a decent thing where we man up and then we just keep - if there is a fire, there has never been an opportunity in the quarter of a century or so I have been at this, that somebody said you cannot fight fires. We just go and do our thing. Then we come back and get the money.

MR. WOODFORD: We have a lot to look forward to, haven't we? A two-and-a-half degree drop for the next fifty years.

MR. TAYLOR: Yes, I will not sell my skidoo yet.

MR. WOODFORD: I say you should keep it.

CHAIR: We will take a ten minute break and be back here for 10:30.

CHAIR: Order, please!

That is a good question there.

We will go to Mr. Taylor, do you have a few more questions?

MR. TAYLOR: Yes, I can ask a couple of more questions, I guess, if you want to hear them - if you want me to fill up the time.

CHAIR: No problem, Sir. We welcome all questions in this Committee, a very open Committee.

MR. TAYLOR: Just a couple of questions. They are not really, I suppose, related to the Estimates, but one is and one maybe not - related to the policy on sawlogs. As I understand it, departmental policy is wood over five inches, if it is useable for straight or whatever, has to go for sawlogs. As you may be aware - I know you are aware of the Northchip situation in Roddickton and the fact that the mill was closed down. It looks like the company is in the process of disposing of some or all of its assets there. Back within the last month-and-a-half, I guess it was, the sawlogs that were on the premises were put up for tender and a successful bidder - I guess for lack of a better way of putting it - was Abitibi. The logs were taken off the premises and taken to Stephenville to go through the pulp mill.

How does the department see that? It is obviously in contravention of the policy and - does the department have any problem with that? I wish the people of Stephenville get whatever wood they require, but having said that, for opening the door on sawlogs moving off a lot to a pulp and paper mill, then what is the difference? If you cannot take it off the stump and go to the mill, how can you take it off a lot and go to a mill? That is the question I would have to ask, I guess. It was only a small number of logs but is the door creeping open a little bit there?

MR. WOODFORD: We did not like that at all, Trevor, to be honest with you. I am with you on that one, but once it got into the tender system - they had cut their permit. They had left it in the yard. It was logs that were left in the yard, and under the conditions of their permit they were - like you say, it was cut for that mill and that area. Once they put it up for tender, and anybody could tender on it, well we are caught between a rock and a hard place because under the tendering process you have the right to tender. Yet, under the mill permit, those logs were meant for that mill and for that area. There is not much we could - what was the law? I just forget exactly. We could not do anything about that once they put it on tender. I do not know if there is anything else Allan can add to it, but once they put it on tender we could not - you could bid, Ray could bid, Harvey could bid, and I could bid. Then, under the tendering process, if I did not want to saw it in Roddickton, or Harvey wanted to take it back to Mount Pearl, what could stop him? We are really caught on that one. Overall, on that situation there in Northchip, we are making sure that those permits stay with those people down there. It is not going to anybody else as far as we are concerned.

MR. TAYLOR: Yes, I understand that to be the case. The reason I asked the question - I guess I will lead into a second question on it - would be, if there is nothing that you could do, don't you think that you should probably re-examine policy or regulation to make a change so that a situation like that would not be able to happen in the future? I will just use an example. Say tomorrow contractor x decided to cut 2,000 metres, put it on a lot and put it up on auction, put it up on tender, call tenders on it, wouldn't it be pretty much the same as what Northchip did? I would see it the same way, anyhow. Given the appetite and the circumstance of Stephenville, for example, right now, I would expect that they would, in the short term at the very least, probably not in the long term, be prepared to pay premium prices, so to speak, for fiber supply. We could find ourselves in a very similar situation any number of times in the future.

MR. WOODFORD: I would question that one. What are the limitations we could put on the permit because that is an annual permit, right?

MR. MASTERS: Yes. Under the permits, Sir, we can force it to go as logs to the sawmill, but once we get into the second and third purchaser, it is a gap. You are quite correct in pointing it out. We have the same concerns, that if a company wanted to start trying to get cute with this, what would prevent it. We recognize that and we are trying to plug that hole, if you want to call it a gap or a hole.

On Crown land our policy is quite clear, sawlogs go to sawmills, they don't go to pulp mills off Crown land. We have to take whatever steps - oftentimes, these regulations are on the books for years and years and years and it is only when something like that happens and they get challenged that you see there is a gap there. It is a valid point you raise and it is the same concern we have. We will be taking steps to make sure this doesn't get out of hand. I don't see it getting out of hand, but to make sure it doesn't, because you are quite right: What would prevent you from cutting the wood, putting it up on tender and then having it go?

MR. TAYLOR: If a couple of contractors wanted to get cute about it, I could sell my logs to you and you could sell yours to me, and then the person who buys it from me is now the second purchaser, put it on tenders and we are around that.

MR. WOODFORD: That is true. That is exactly what we questioned.

MR. TAYLOR: We are a pretty creative lot when it comes to figuring ways to get around rules in systems.

Anyway, related to Northchip again: Obviously, we all know there was a significant amount of money lost by their logging contractors there in that area, and truckers and what have you, probably in excess of a half million dollars or roughly half a million dollars. The irony of it all is, I suppose, that the fellows who cut the logs for Northchip, who paid the stumpage at the end of the day, they got nothing out of it. I don't know if they brought it up to you, but they brought it up to me, so I will bring it up to you.

Has there been any consideration, any willingness, on the part of the department, given the special circumstance there, to consider a reimbursement or a waiver of the stumpage fees that were charged to the fellows who cut that?

MR. WOODFORD: No, we did not because the stumpage thing is something that we are very, very strict on, to be honest with you. To the point of closing down some mills, we are not issuing the permit until the stumpage is paid. We have gone that far. I have talked to the people that you have mentioned in Corner Brook, we had a couple of meetings in fact, and it is too bad because those people pay their stumpage.

MR. TAYLOR: That is why I asked. If they did not pay their stumpage and they were having trouble with them over the years, I would not even raise it.

MR. WOODFORD: They paid it to the parent company, say, Northchip, and they were supposed to have paid it to the department, which they did. Northchip doesn't owe us any money for stumpage, do they? I can't remember, but I don't think.

DR. NAZIR: They have paid.

MR. WOODFORD: They have paid

DR. NAZIR: Northchip (inaudible).

MR. WOODFORD: Pardon me?

DR. NAZIR: Northchip paid those fees.

MR. WOODFORD: There were others- to answer your question with regard to it, we have not considered that at all. In fact, I told the fellows at that time that we would not even consider it, to be honest with you, because of the pressures that we put on some other operators in the Province. That is not saying - because I do not know what is going to shake down on Northchip, to be honest with you. I do not how the situation is going to -

MR. TAYLOR: (Inaudible) there yet.

MR. WOODFORD: Yes, because with Bloomfield they have not touched Northchip yet, and the permit, we are ready now. The first of April their new permit is available to them in that area. There are some questions to be answered with regard to it, down there.

On the stumpage fee itself, a lot of people get caught. They pay through a company, they pay it themselves through a company, and the company does not reimburse it or the company reimburses it and they figure that they have not had their AAC cuts, say if it was 3,000 cubic metres in that area and did not cut it and so on. There are a lot of questions on the stumpage part of it.

To get back to your question, no, we have not consider it on actually forgiving them or reimbursing them.

MR. TAYLOR: I suppose it is somewhere in the Estimates, or maybe somewhere in some estimates, but I noticed as I read the Economy - I went through the Economy book over the last couple of days, and I do not know what page but it really does not matter, I suppose - Canada Bay Lumber - and they are not referred to as Canada Bay Lumber in the book, but Wood Products Industries Limited - the particle board manufacturing plant in Roddickton which has been under construction, I guess, since the fall of 2000, at an estimated cost here of $8.2 million, it says that there are private, provincial and federal funds.

I was not involved with politics at the time and did not pay a whole lot of attention, to be quite honest, to some of that stuff at the time. I am just curious. I would like to know how much in provincial funds, how many dollars, approximately, from the provincial Treasury at the very least, are going into that initiative?

MR. WOODFORD: I do not think there are any funds from our department. I will check, but you could check with Industry. There are some funds, I believe, gone in through Industry, Trade and Rural Development, whatever that department is over there, and they deal with that. By the way, they are still planning on opening that in June, is it?

WITNESS: The date keeps moving, but June is the latest one (inaudible).

MR. WOODFORD: That is a nice way of putting it. The date keeps moving and the last one we heard was June. If it is, Trevor, if that does go ahead, that will be great for the area with regard to employment.

MR. TAYLOR: Yes, indeed, it will be. Hopefully, as you said, the date will soon stop moving and it will go ahead.

MR. WOODFORD: It will come to fruition.

MR. TAYLOR: A lot of people are looking forward to it.

I am just curious as to the $8.2 million and how much of it was federal and provincial funding and how much of it was actual private investment.

MR. WOODFORD: Mostly federal and private there, but Industry, Trade had something to do with it.

MR. TAYLOR: Right.

Well, those are all the questions I have for now. Ray, do you want to pick her up again?

CHAIR: Anybody else?

Mr. Hunter.

MR. HUNTER: Minister, there is going to be a high price tag, probably, on solving the short-term problem for Stephenville, but it has been brought to my attention, and I got calls on it from contractors, too, that there is still a lot of over-mature wood on the Island. It seems to be unaccessible. I guess with the roads program it can be accessible, but it is going to have to be probably subsidized somehow to get at it. I refer to wood up around the Granite Lake area. There is a lot of old, aged wood up there, and it could be a short-term solution to some of Stephenville's problem. I know it is a very hard place to access. Are you planning on doing anything to access this old age wood, particularly in the Granite Lake area? There was a contractor who called me, and he has no wood to cut but he is quite willing to go up there and cut this wood for whoever wants it. Is that Crown wood in that area, or is it Abitibi's wood?

MR. WOODFORD: On Granite Lake, it is Crown.

MR. MASTERS: Yes, that is Crown wood. It is part of District # 7, actually, the Bay d'Espoir area. What has made it available now, and why you are getting some calls, I suspect, is that the latest Hydro development up there, where they upgraded the road to Granite Lake, there is some fibre up there. We do not have a really good estimate on what is there, because it was always further south than where inventories went. We are actively looking at that area, particularly as it relates to the operators in the Badger area and the Bay d'Espoir area. What would come out of it, I do not know, but there is an opportunity there that we are looking at.

MR. HUNTER: I think there are plans to connect Bay d'Espoir to Island Pond and over to Granite with a road?

MR. WOODFORD: There is talk of it.

MR. HUNTER: If that is done, then there is going to be a lot of wood accessible. I guess with your roads program, and help for the contractors to go in there, there is a lot of wood in there that could be accessed through that initiative.

MR. WOODFORD: That project there would make it easier, because if you have to put an access road then from the one you are talking about, from Granite Lake and Long Pond, it would make it much more viable.

That was a stand of timber there that - was that included in our petition? It was not even included in our AAC. It is a good stand. We do not have a handle on how much is there, exactly, in that area, have we, Mo?

DR. NAZIR: We do not have any updated -

MR. HUNTER: So, will that go to existing contractors who have permits, who have nowhere to cut, or will you issue a new permit to somebody?

MR. WOODFORD: If someone came in to us today with a good business plan for a petition stand or a class tree stand in the Province, we would entertain it. It does not matter who it is.

DR. NAZIR: (Inaudible). That is why we have to (inaudible).

MR. WOODFORD: Yes, I know.

Usually, with the adjacency, as Mo reminded me, you run into, Ray, out your way, the Bay d'Espoir people would want that wood.

MR. HUNTER: Yes.

MR. WOODFORD: We have to see what is there first, how much is there, and, like you say, if it is over-matured, how much has fallen down, and how much is bug kill or whatever.

MR. HUNTER: There is a contractor from my district now cutting into Upper Salmon, heading that way. They are already over there cutting. The wood is really old and the centre of it is rotten. We have to try to harvest that before -

MR. WOODFORD: Yes, because that is what we are running into in Labrador.

MR. HUNTER: Yes, the same as Labrador woods.

MR. WOODFORD: Taking two or three (inaudible) chunks off it and end up with very little of the log left to go anywhere. Everybody figures it is perfect for a sawmill.

MR. HUNTER: With respect to the Bloomfield operation now, there are not cutting their AAC for the year. Is there going to be anybody else operating on that permit for the remainder of this year, or is that situation almost settled now?

MR. WOODFORD: Their permit would not come in until April 1, which is just this week, for this allocation this year. We are monitoring that - I cannot say daily, but at least weekly - to see what is going on there. As you know, there are two or three partners involved in that situation, but we are watching it because Northchip is tied into it down in Trevor's area. All told, isn't it around 30,000 cubic metres down there? Ten or eleven for the - and twenty for the other one, or twenty in total? Anyway, it is quite a bit of wood in the Northern Peninsula area.

MR. HUNTER: It is going to make a difference to Abitibi out there, because they avail of a lot of chips from that.

MR. WOODFORD: Yes, big time.

MR. HUNTER: They are a bit concerned over that amount of wood not being cut and not being delivered.

MR. WOODFORD: To add to that, with Abitibi, about 40,000 cubic metres of the Labrador stuff was coming in, going through Bloomfield, and going right on to Abitibi.

MR. HUNTER: Yes.

MR. WOODFORD: It is a concern. We are watching that one. There is not much we can do with it now because of the -

MR. HUNTER: It is still in the early stage.

MR. WOODFORD: - because of the receivership thing, but once that is dealt with we have to look at exactly what you were saying, the permit, and see if that is going to be exhausted this year.

MR. HUNTER: I had a call from a small contractor, he is a firewood contractor, and he is really concerned that this royalties have increased, over double from last year. That is Terry Saunders from Central. You are familiar (inaudible). He was paying sixty-seven cents a cubic metre, I think, royalties, and now he is up over $2. I am not sure if that is the exact amount now, but somewhere around there.

MR. WOODFORD: On his domestic, you said?

MR. HUNTER: Yes, he is a commercial firewood cutter. He is cleaning up the Northern Lake area, on Abitibi's area. He is being charged - and he cannot maintain that operation with that type of increase. He wants to -

MR. WOODFORD: Give us the name and we will check that out, because I did not think it was that much of an increase with regard to -

MR. HUNTER: According to him, it is.

MR. WOODFORD: We brought the pulpwood and the lumber royalties into sync. I will tell you one of the reasons why we did that. It was because of the softwood lumber dispute. The first thing is, they come out and they are looking at us individually, like the Atlantic Provinces. They look at us as holding private property shares and private lands. That is one of the reasons why we are escaping the softwood lumber thing.

We looked at this and said, the first thing they are going to look at is stumpage - the first thing they looked at in other provinces - so we did bring that in line with the pulpwood as a token. It was not very much, but I did not think we increased that -

MR. HUNTER: No, he is cutting dry burnt wood that is in burn over -

MR. WOODFORD: Firewood, yes.

MR. HUNTER: - firewood, as a commercial operation. That is putting a lot of extra cost on his operation.

MR. WOODFORD: We will check that out.

MR. HUNTER: He is the guy in there with a harvester cutting firewood, burnt-over wood, and that kind of increase is going to put him out of business. Really, he is doing the environment a favour by going way back where he is, to clean up these areas, these burnt over areas. He is not too pleased with such a -

MR. WOODFORD: Do we have his name?

MR. HUNTER: Yes, Allan got his name here. I would like to check that out.

MR. WOODFORD: Yes, we will check that out.

MR. HUNTER: I am just going to pass it over to my colleague for a few minutes. He has a few comments there, then I will get back to some of the other issues.

CHAIR: Mr. Hodder.

MR. H. HODDER: Thank you, Mr. Chair.

First of all, I have to say that I am very interested in all this discussion. I grew up in a family where we had a sawmill licence for an operation for fifty-seven years. Only with the passing of my father, did the operation cease to exist.

CHAIR: I thought you were a St. John's type, Mount Pearl (inaudible).

MR. H. HODDER: There you go. I had a life before I came in here. I grew up in this milieu of forestry. Also, I should say, that until quite recently I was one of the few St. John's members, together with my friend from Kilbride, who actually had a farm in his district.

The Dooley farm on Blackmarsh Road was there until just recently when they sold their milk quota after 120 years of operations. So I have some interest in that. Of course, many years ago I was very much associated with the farmers in Kilbride and the Goulds for the metropolitan area board, but I also had the joy of being very much involved in parimutuel betting where I was the chief agricultural officer with the federal department for many years. So I got to know a lot of the farmers and they were wonderful people to be around.

I wanted to draw some attention to the fact that in some of the background that I have done in preparation for this, I met with some of the agriculture people and they note that Newfoundland is the only Province of Canada that does not participate in the national plan. This is the producer run organization that manages the collective marketing of milk quotas through the Canadian Milk Supply Management System. Why is Newfoundland not part of the national plan for the Milk Supply Management System?

MR. WOODFORD: The dairy association of Newfoundland and Labrador - it is up to them what they get involved in. In the last two years they have negotiated with the feds - I forget what it is called now, the national dairymen's association or whatever they call it - on this 31 million litre industrial milk quota and that it where it came from. We were never involved in that. We were never included in the industrial milk quota across Canada. This is the first time that we have been included - isn't it? - with regards to the industrial milk quota. So if we do not produce that we could lost it in fifteen years.

MR. H. HODDER: My understanding is that the 31 million litres that we are talking about is there, it is protected for Newfoundland now for a period of time?

MR. WOODFORD: Yes.

MR. H. HODDER: If we do not use it we will lose it?

MR. WOODFORD: Exactly.

MR. H. HODDER: And this will be added to other provinces?

MR. WOODFORD: It could. It is up to them where to allocate it or reallocate it but we have that commitment now. I think there are two years gone on it, if I am not mistaken, already. We have 31 million - as I said earlier, if we do not do it - I mean it is going to double the dairy industry in the Province, pretty well double it, because that is what we are producing now in fluid milk.

MR. H. HODDER: One of the industries in this Province where we have great potential for growth is in the dairy industry, the agriculture industry. The notes I have here says that we could create up to 500 permanent, sustainable jobs in this industry.

My question to you, Mr. Minister, would be: What steps are we taking to permit our farmers to meet the challenges that are associated with them and enable them to access and use the 31 million quota that they could access through the federal program?

MR. WOODFORD: Well, where we could help is having some, like you say, policies in place with regards to - the biggest problem here, Harvey, is the land, the feed costs and so on. For instance, us compared to Nova Scotia, there is something like a 26 per cent or 27 per cent difference. So that is the biggest thing, cost of production. We are going to try to help out with regards to land enhancement. Getting back to what Ed said this morning, somewhere along those lines, with regards to clearing more land or acquiring more land that is already cleared, cultivated in other places, or whatever. That is a big challenge.

We have people in the Province who may come under the APF, for instance, the Agricultural Policy Framework agreements you were about to sign with the feds. Under the environmental part of it - say, for instance, you have 100 head of cattle and you only have the land to spread it for fifty, total was fifty, they may be able to come under land enhancement to get extra land cleared or acquire extra land that has been idle and cultivated - some way to try to help them. That is one of the biggest ones we have addressed in the agreement and with the provincial part of it, is to try to help them out with regards to land base.

MR. H. HODDER: The notes that were provided to me show that the Canadian average is eight cents per litre for the production costs of purchased feed, but in Newfoundland it is twenty-eight cents per litre of milk. So really we are three-and-a-half times. The farmer in Newfoundland is paying three-and-a-half times the Canadian average cost for purchased feed. Also, when I talked to the farmers they indicated that much of the purchased feed was of - the nutritional value wasn't as high. They have done studies on that.

When I was over to Kilbride last Saturday, the big truck arrived - you know, you see them going down the Trans-Canada - and talking to one of the farmers there, they have no choice. If they are going to keep their farms going they have to buy this feed. Are there standards that we have for importing feed in terms of the nutritional value of that feed? Who sets the guidelines as to what the nutritional value is of the feed? Because they say to me that the value of what they are bringing in, in terms of its nutritional content, is not equal to the value that they would have per ton.

MR. WOODFORD: Well, what you are talking about there, it cannot be grains because grains are usually uniform. It depends on what you order. Is it 16 per cent or 18 -

MR. H. HODDER: This was hay.

MR. WOODFORD: Yes. This would be hay or silage or something like that. That is usually left up to the farmer themselves. I was in the business for years and if I go over to one farm, if I go into Ray's, I would do a bore, take samples. A like of people buy but do not check anything. They just go and buy, and say: Send me in twenty bales of hay from P.E.I. The truck arrives and there is about 10 per cent protein in it. What I will do, I will have someone in P.E.I. or Nova Scotia or someone take a bore, get an analysis done of it and a sample done of it, and if it is 15 per cent or 16 per cent, grab it. Take it right quick. But you are right, some of the stuff that is coming in is garbage.

MR. H. HODDER: Yes.

MR. WOODFORD: What a person is doing in Kilbride or Cormack or Deer Lake or Codroy Valley, they are sitting down and taking the phone, and saying: John Doe, send me down ten ton of feed. That could be the worst that is going on, but usually if it is a supplier that has quite a bit and he is moving into the Province, he is usually pretty good. He usually keeps his protein and his nutrients up.

MR. H. HODDER: What this farmer said to me was there are not any standards that they can measure against. When they going out to order in feed, as you said, they are often on the phone and they may be talking to three or four suppliers - most of them are in the Maritimes, rarely do you go - if you cannot get them in the Maritimes - because the cost of bringing it in is less, but there is nobody saying: Here is what the content has to be. His suggestion was that somebody needs, together with the industry, to develop a standard so that when you are bringing feed into the Province of Newfoundland then there has to be somebody saying: Here is what the nutritional content has to be. That can be done.

MR. WOODFORD: It can be done but the only thing about it, I venture to bet that if I did that tomorrow, brought in rules and regulations for that, I would be hung out to dry. I would be the first one - what a lot of people do is they bring it in for roughage. They are looking at a 8 per cent or 9 per cent protein rate, which they should not. How do you check it? If it comes to Port aux Basques to come in, I have to take a sample and go somewhere to get it checked. It is a logistical nightmare with regards to the protein content and what it would cost to do it. I can see their point because I have seen it come in. I have seen it down as low as 6 per cent or 7 per cent. It was ridiculous. You would know by the colour of it, especially hay.

MR. H. HODDER: It was the discard that some farmer had in P.E.I. somewhere.

MR. WOODFORD: Exactly. The danger with that is calling someone who probably has three loads or four loads or five loads - they do not care. Once they are rid of it, they are rid of it, but someone who has 100 loads they are more particular with it. They are more particular with making their silage and their haylage and they have a pretty good content in it, if not they would not make it.

MR. H. HODDER: The answer to it is that there is a 30 per cent deficiency in forage in Newfoundland, approximately. Farmers are only producing about 70 per cent of the food that they need for their animals.

This morning, in talking to the Member for Kilbride, you were talking about the strategics you have to assist farmers to increase their forage, to be able to get more land opened up. What are some of the constraints on that? For example, we know there is a strong agricultural industry, let's say, out in the Lethbridge area. We know there is a strong one here in St. John's. There is one over on the West Coast, in the Codroy Valley area, and there is a strong one in Cormack that we know you are very familiar with. What are some of the problems in terms of being able to develop forage lands, let's say, on the Avalon?

MR. WOODFORD: Well, on the Avalon - I would say anywhere else in the Province the basic problem is money, because you have access to pretty well lots of farmland outside. It is questionable in some areas, but here in this area you are constrained by the boundaries. You are constrained by the price of land, for instance. We were talking this morning, we will average our land consolidation one by about $3,000 to $5,500 an acre. You can go out in Cormack and buy all the land you want for $400 or $500 an acre. Just imagine the difference of buying 100 acres of land consolidation here and going to the Cormack area, which I am familiar with.

One of the biggest problems we had as a department over the years too, a lot of land was sitting idle - and to say the department would not help. They would give the farmer $600 or $700 or $800 to develop new land, cut down the trees and develop new land, but they would not touch land that was already cultivated. For example, if you had 50 acres and 40 acres of it was cleared, and I wanted to buy it, well there was no help for that. But there was help to cut a new farm out of the forest.

These are some of the things that we are looking at now under the new agreements in the Province, but the biggest constraint, as far as I am concerned, is money. It costs around - I don't know what the latest figures are - a couple of thousand dollars or more per acre to try to get down to production. We helped out the last time, around $700 per acre. You can imagine, it is a big cost. If you put fifty acres down, you are talking about 100,000 bucks (inaudible).

MR. H. HODDER: If you look at it from a development perspective, agriculture is still one the growth industries that is underdeveloped in Newfoundland and Labrador, particularly in the Newfoundland part of it. There is tremendous potential in this industry because we have perhaps just realized that you do have the industrial milk quota. Ed mentioned that the morning. Money invested in this area can generate - studies that I have here with me this morning show that we could have 500 sustainable jobs. There are not many industries in Newfoundland where you can say you can create 500 jobs that are not going to be gone in ten years, five years, that they are going to go on and on and on.

One of the other things that got mentioned was the - and, of course, I should point out that most of the jobs we are talking about are primarily in rural Newfoundland, which is significant. The big growth industry in rural Newfoundland is in agriculture. We have done some studies on that, and I have some papers here with me that indicate that.

One of the things that the committee I met with talked about was training programs for farmers, getting them better training, more up-to-date training, access to new technologies, that kind of thing. What training programs do you have for farm people? How accessible are they to the average farmer?

MR. WOODFORD: Well, the training programs that we have of late, especially in the last Safety Nets Agreement, if I can recall, were done primarily - farmed out through the Federation of Agriculture, either through the Safety Nets Agreement or through another (inaudible) agreement or whatever we had, whatever agreements we had with the feds. They were farmed out. Say the Federation of Agriculture decided they wanted someone to do - we do a program, for instance, on pesticides, herbicides, stuff like that, with the farmers every year. There are different programs like that, but they are usually done through the Federation, in conjunction with the Federation.

I met with the Federation just last week and that is one of the concerns that they had with regard to training programs and so on. That is something that we are going to try to address under this new APF agreement as well. If there is anything there, working in conjunction with them, if they can identify something - it is no good to go out and call a training program for something, for someone, if you are only going to get 1 per cent or 2 per cent of the populous to take advantage of it.

MR. H. HODDER: No.

MR. WOODFORD: If there is something there, a program that the Federation of Agriculture can identify with, then we will try to put it off.

MR. H. HODDER: I was very encouraged by the fact that they were asking for more access to training. I look at some of the farmers that I know from Kilbride and the Goulds as being pretty knowledgeable people, but they are saying that they would like to have more access to training and more opportunities for the department to show some increased leadership in that area.

The other problem the came up, which was already alluded to this morning, was the issue of farm succession and how we can assure that farms - farmers get old and, as farmers will tell you, as one farmer said to me one time, it is the only business where you live poor and, if you are lucky, will die rich; because all of the assets you have are right there: your land, your machinery. Everything is there and you have all of this in assets but sometimes your liquid cash flow is not as great.

One of the things that we find in some of the areas is the issue of farm succession. Again, the farms are often passed on to a family member, but increasingly that is not the case. They are not passed on to family members so the herd, the quota and the moveable equipment can be sold but the farms and the barns and the operation go out of production, so you have what you have in the Eastern Townships of Quebec, for example. You drive up through the area there and you have those old looking buildings that are empty.

What steps are we taking in Newfoundland to try to address the issue of farm succession to assure that even when farms are not passed on to family members that the farm does keep in production?

MR. WOODFORD: It is a good question because this has been a topic - when we are doing the program, this APF program across Canada, it is very topical out West and places where they have the bigger farms.

MR. H. HODDER: Yes.

MR. WOODFORD: As you know here, Harvey, in this Province, most other provinces are first, second, third, fourth, fifth, sixth generation farmers. We here are just a development province when it comes to agriculture.

MR. H. HODDER: Absolutely.

MR. WOODFORD: This was a big topic, this succession part of it, with the program, with other ministers. We addressed it in the pillars. One of the pillars that we have in the APF is a pillar called renewal. In that, that does address succession.

So there will be some funds there for some training and to bring in some professional people to deal with this succession problem. Although here in Newfoundland it was not a big problem but now, getting back to what you said, a lot of the dairies, say, for instance, I will use the dairies, they are supply and management and they are big dollars. You are talking about $1 million, $2 million, $3 million operations. You are not talking about chicken feed any more. It is big business. What they do, they are selling the quota, say, to John Doe over in Codroy, or someone out in St. John's, and the buildings and the land are left there. So one dairy operator is getting bigger, the other is getting smaller, because, when you sell the quota, you sell just that, the quota.

MR. H. HODDER: That is right.

MR. WOODFORD: The cattle and the right to milk their fluid quota, and the barns, are left there. The land is left there. This is what I was saying earlier, a lot of vacant farmland left in some places that may not be in proximity to the person who got the new quota but it could be utilized. I know people who are utilizing it in our area and trucking it as far as the Goulds; making it and trucking it as far as the Goulds and the Northern Peninsula. Mr. Brophy used to come up to Cormack and make it and truck it, on this absent or vacant farmland that is not being utilized, and truck it back to Daniel's Harbour.

That is a problem that has been identified across Canada. We did not run into big problems here, but we are doing it now. We are starting to run into it with the bigger dairies. I notice in my area, two or three or four dairies in the last few years have been sold. Their quotas have been sold and the land and the buildings are still there, like you say, empty.

MR. H. HODDER: It is so sad.

MR. WOODFORD: It is sad because those buildings are worth a lot of dollars to someone who is starting up. Some of them may be utilized with this industrial milk quota. They may be. There are people asking about it now already, but it depends on what the dairy people do in the Province with regard to the allocation of that quota.

MR. H. HODDER: Or the land is simply then used for forage or, you know, they do still sell their product -

MR. WOODFORD: Yes. They still sell their product.

MR. H. HODDER: - if somebody is there who has a connection to the family and the land is not passed on to somebody else.

I think the point is that, when that happens, we lose something in terms of our growth in the industry. We have a piece of a puzzle. There are a thousand pieces in a puzzle and suddenly there is one little piece of puzzle - the puzzle is minus a piece every time that happens.

MR. WOODFORD: I know of one operation in my way - you talk about the land base - there was about, I would say, 300 to 350 acres down in production, being cultivated. Now, lucky, so far, it is still being used, but you have to remember that the person who is going into cut that and to salvage it on a short-term basis is not going to put the nutrients and the same things back into the soil that you would if you were working it. That is the sad thing about it. After three or four years it starts to degrade, it starts to go down in production. It is like getting back to the lease versus grant. They put the money into granted land but they will not put the money into production in the leased land the same as they would in grant. It is a problem.

MR. H. HODDER: No, and there is logic in that, too.

CHAIR: Mr. Hodder, can I give a break to Mr. Butler to have a few words and then we will come back, if we could do that? Are you almost -

MR. H. HODDER: I have a few more questions.

CHAIR: Sure, okay.

MR. BUTLER: Just the one question.

CHAIR: Mr. Butler.

MR. BUTLER: I was wondering if there are any new developments - an issue that I have discussed with the minister in the past and other officials, as well, with regards to the issue of crop damage caused by moose. I was wondering if there are any developments or any new areas that are being looked at with that situation? I know it is a problem in my area and, probably, other areas.

MR. WOODFORD: As you know, Roland, heading back to the moose damage. A few years ago, or seven or eight years ago, we had some real problems with moose damage - especially out your way, but right across the Island - to the tune of somewhere in the vicinity of - I saw some figures out your way, some farmers have been out $250,000, $300,000. We addressed some of it but very small. Now we are in the process - we have this new type of fencing and it seems to be pretty good the last few years. What is the name of the fencing called?

WITNESS: (Inaudible) braid.

MR. WOODFORD: It is electric braid, is it? Because we used to use electric fencing for dairy and so on but this must be a different kind of - but it seems to be pretty good. They tapered off the last three or four years. I do not think you will hear too much about moose damage but it was a real problem. Some of those people are still feeling they are out a lot of money.

CHAIR: Okay. Anybody else?

MS M. HODDER: I do not have any questions, thank you.

MS KELLY: I just have a couple. I was listening when Mr. Byrne was first speaking this morning, and he says: No one talks about our agricultural strategy, so how can we help it grow and everything? Then Mr. Hodder was just saying that it has tremendous potential.

I remember when I was Minister of Industry and we took a look at trying to figure out how to use an immigration policy to bring some people in because, as we all know, we do not have a culture of farming here. Our history is on the sea and it is very difficult, now especially. To make a living at it you have to be in it on such a large scale and it is very hard to start small.

I have several questions. One being: Are farms still having trouble getting employees? Because one of the major pieces to all of this - in our society now our young people are being brought up that they have aspirations to have more than a minimum wage job. I know that in many farms, even employing their own families, it still turns out to be very minimum wage work. So, I am wondering if that is improving? If most of our farmers, or most of their employees, are just making the minimum wage, and are they still having difficulty getting employees? I know over in your region, Minister, that is the area they were saying to me: People do not want to go to work, having to get up on a dairy farm and be into work at 4:30 or 5:00 in the morning, then be off during the day and sometimes have to be working again in the evening. It is hard enough to get your own family to do it, let alone get employees that you are paying the minimum wage.

MR. WOODFORD: I have not had much brought to my attention over the last while with regards to an employee problem. Maybe because the industry, especially the dairy industry, is getting more mechanized.

MS KELLY: Fewer jobs.

MR. WOODFORD: Some of them are milking three times a day now instead of two.

But you are right, one of the problems we had was getting up early in the morning. I know what it is like. I spent a good many years getting up at 4:00 a.m., and then all of a sudden you are down to a meeting at 10:00 in the morning and someone says: Well what were you doing all day? You have a days work down before anybody else gets up.

It was a problem there for awhile in parts of the dairy industry. I think now, like I said, farmers are getting bigger and more mechanized, milking more cows, different dairy parlors and so on involved.

The other part of it with regards to people leaving the industry, and getting back to Harvey's question about succession, this is why a lot of the younger people today - I know (inaudible) out my way, have left and gone away or gone somewhere else to work because they know - they worked when they were young and they know how hard it is. Once they get that last report card from the school they are gone. One of the big reasons at that time was the work that was involved in the farming operation. I have not heard much lately of it, to be honest with you.

MS KELLY: One of the things that I know, and as Minister of Industry, when we looked at it we were trying - I met with a few veterinarians over on the west coast who were interested in helping us take a look at the EU. A lot of farmers have been bought out there, especially in Holland. They have quite a bit of money. Some of them have been immigrating to Canada with this money in their back pocket and some incentives offered by various provinces to set up. We had thought, at that time, that would be a good strategy for Newfoundland but it appeared, as I was talking to people - and I got shuffled before I really got into it in greater detail - but it appeared that we did not have the vast amount of land. We were not far enough along in our development to get them interested, the way they were in Prince Edward Island, for instance. Do you know of any farmers who have moved here from the European Union that have been successful?

MR. WOODFORD: I know of a couple who have moved here but they are primarily small mixed operations, and for different reasons they are much older. Also, you are right, we are a developing Province when it comes to agriculture. We only have 1 per cent, I think, of our total land masses suitable for agriculture. It is developing. It is a job, in this Province, to find a farm that has 1,000 acres cleared. Yet, when you hit Ontario and Quebec and out west, that is the norm. It goes from that up. There is no doubt about it, I have not seen any - I do not know of anybody who has moved here from Europe, or any of the other countries, that has any big operation. I know of people who have moved here from other provinces, I must say, and brought up dairy operations and so on. That has been fairly successful.

MS KELLY: I guess the milk quota seems to be all utilized that we have, but the production in our strawberry farms, our vegetable farms and everything like that, are the farmers able to sell everything they grow in the Province? Because I would imagine it is pretty hard to export from this Province when you consider how expensive it is with the small scale operations we have to make a living. Are they able to sell everything they produce?

MR. WOODFORD: I am not getting any complaints from the strawberry operators or anybody like that with regards to the selling. They run into some problems, depending on the type of season we have. I know the people over my way, they pretty well sell - with regard to strawberries and things like that, that type of crop, they have no problem with it.

MS KELLY: (Inaudible) vegetables and that sort of thing.

MR. WOODFORD: Yes, they have no problem with it.

In fact, I had one fellow last year - well, it is a little different, he got into the raspberries, the plums, cherries and things like that. He even exported some of it.

MS KELLY: Did he?

MR. WOODFORD: Yes. He sold it right across the Province, plums to the Sobeys and Dominions of the world; as much as tractor-trailer loads. I have not run into any problems with regards to the strawberry part of it. There are a lot of people getting into it. So eventually it will probably come to that, unless the consumption goes up like a dairy industry. We increased the dairy industry, my God, hundredfold. Consumption is up, although our population is down. It is an example of what can happen if you really pushed the thing.

MS KELLY: There is no doubt now - I was reading something this week, the BC Raspberry

Growers Association have taken out some great ads in Maclean's and everything like that, showing that the research they have been doing on raspberries and their antioxidants and their anti-cancer things, you would expect a huge surge in that industry. I would assume - I never thought to ask but maybe Marty would know - that our raspberries would be as high in all of these ingredients as what you would see in B.C. Our red raspberries, I assume, would be as good or better?

MR. WOODFORD: Anything grown in a nothern climate always seems to be better. Our vegetables always - good old turnip, when it gets a bit of frost into it in the fall of the year there is nothing like it. The same thing with our berry production, I suppose, and it depends on your variety. I remember a fellow over our way has an orchard. Can you imagine an orchard in Newfoundland?

MS KELLY: I have been there and had his apples. They are incredible.

MR. WOODFORD: Someone told him that he could not do it, but he went to Minneapolis somewhere, Minnesota, and got that certain strain. Anybody who eats a strawberry figures it is a strawberry. It is not; there are all kinds of varieties of strawberries. You can get the early variety, you can get different kinds - six and seven in a lot of them. I know one fellow over there who is growing six different kinds or varieties of strawberries. It is all in the eating.

MS KELLY: Thank you.

CHAIR: Thank you.

Mr. Hunter.

MR. HUNTER: I will get up for a little bit. I have a couple of questions for the minster.

Minister, you put out a news release on the $550,000 as the initiative to deal with participation by the Innu Metis in Labrador. What particular program do you have for that? Is there a set out program where you see and budget for where you are going to spend this $550,000?

MR. WOODFORD: As you know - I have mentioned it several different times, and I probably mentioned it in my opening statement too - that is a process agreement we had with the Inuit the last couple of years. We finally got an agreement with the Innu part of it. As I outlined in my statement with regard to the Memorandum Of Understanding and so on, that we have the Metis now dealing with primarily District # 20 and District # 21. District # 19 is the Goose Bay area. That is were we got the agreement with the Innu.

Over the next five years we are supposed to (inaudible) so much from monitors. For instance, we use I think three forest fire technicians, or something like that, and they use so much of the money for a monitoring system. There is an agreement we have with them now in the Goose Bay area, on the 57,000 cubic metres or 58,000 cubic metres that we have there, but if we go across the Churchill River we could access another 130,000 cubic metres over there. That is called a forest management agreement with the Innu. It deals primarily with so many forest firefighters in the spring of the year. That money will also look after the monitors that they use in the woods.

MR. HUNTER: So that is in the way of a grant issued to them, that they administer under their own budget in their own program, is it?

MR. WOODFORD: Yes, $250,000. The $200,000 goes to them and the rest of it is for ourselves. I think we use the fire people, don't we?

MR. MASTERS: Yes, if I could clarify that a little, there is $400,000 to the Innu, $200,000 goes in a grant which they use to hire their monitors and forestry people. The other $200,000 is for joint projects between the two groups.

Last year we, for the first time, hired three Innu forest firefighters, because they have never participated in our business at all in Labrador, and other joint projects around mapping and GIS and just the forest planning piece. So we now have them at a level where we are sort of on a same playing field with respect to - in actual fact, sometimes I think there are a bit ahead of us on the GIS and mapping. That is what it is used for. It is $200,000 in a grant and $200,000 into a mixture of projects that we both agree to.

MR. HUNTER: Some implemented by them and some implemented by your department?

MR. MASTERS: Yes, and the other $150,000 is for the Metis. The Metis is not as far advanced as we have been with the Innu, because we have been with the Innu now for two years. The Metis, last year we signed an MOU with them and we are just now getting them and their (inaudible) capacity along the same lines. To be able to have meaningful input into our plans, they need the same capacities and tools that we have when we are working their, our inventories and things, so that it what we are doing with them.

MR. HUNTER: Minister, I have been getting some calls, from the Labrador people particularly, dealing with the Lake Melville Agricultural Association, wondering what you are doing to enhance the agricultural business in Labrador, in particular the Lake Melville area. There are several farmers down there struggling because they are operating on leased land and they cannot make their long-term plans. They cannot access funding because of their leases and they are, I guess, lobbying to try and have this land granted to them. Are you in the process of changing policy or developing policy to allow the farms in Labrador to expand and to avail of other funding that people with granted land can avail of?

MR. WOODFORD: That is not a very good argument that you are using there, because the land is leased. That has no bearing whatsoever on whether you are viable or feasible or anything else, because a lot of the farmers in this Province here today are operating on leased land. So that is not an argument whatsoever, grant versus lease, because, as we finished talking about this morning, you can produce just as much on a leased property as you can on a grant.

MR. HUNTER: Probably on the Island, but in Labrador, with this new industry taking off, they are saying that it is an impediment to them, rather than on the Island where it is not so bad.

MR. WOODFORD: That I would have to take exception to with regard to an impediment to leased land; but, on the other part of your question with regard to what we are doing there to try to help them, there are certain things that can be done there that are feasible and viable. Anything that is feasible and viable and they want, they can do it. We did it last year. We put limestone in there last year. We got the meri-crusher put in there. We did inventories on lands and made sure that the surveys were done and land identified.

In this one, under the new APF, Ray, we are going to put in what you call a new Labrador strategy for agriculture, a Labrador agricultural strategy, to deal primarily with down there. I do not like to put figures on it, because people always seem to hold your feet to the fire when it comes to a figure, but we are hoping to put at least $1 million or $1.5 million. If it requires more than that, well then so be it, if it is feasible and viable. It is a good question on the Labrador agricultural strategy. The northern food strategy, which would be for the Labrador agricultural area.

MR. HUNTER: Because they are saying that most of the product now is coming in from Quebec. They want to try to produce more product for their use and consumption in Labrador. I guess you are getting calls from the same people I am getting calls from down there.

MR. WOODFORD: Yes.

MR. HUNTER: They are a bit concerned about quotas leaving Labrador, too. The egg quota just left. They wanted special attention because, I guess, they are unique where they are.

MR. WOODFORD: Yes, but on the quota part, I mean, that was an individual decision. In fact, they went out to your area. They were producing the equivalent of 5,000 birds. They needed 18,000 for Labrador. So to make the argument that - where was the other 13,000 coming from? But, the bottom line on it, it was a individual decision. Now, he may blame it on levies. Blame it on whatever you like. An individual made that decision to sell his quota. The levy part of it has to deal with the Canadian Egg Marketing Board. It has nothing to do with me. I cannot interfere in a quota. If you are selling a quota, I cannot very well interfere. You know what is going to happen if I do. So if someone today wanted to get a quota for Labrador and it was available, they can certainly buy it. It is accessible to anybody.

MR. HUNTER: Minister, 3.3.04.10, under Grants and Subsidies, the Safety Nets program. I guess you alluded to it, that it ran out the end of March, but there is still $758,500 there. Is that already spent or is it going to be earmarked for specific programs?

MR. WOODFORD: I think that is a carryover, I believe. That is a carryover from the Safety Nets one, Ray.

MR. HUNTER: Is there an extension on that now, too, until this money is spent?

MR. WOODFORD: Well, we will go and continue on, you are right, into the new year with regards to it. We will not hang up because we have $2.6 million of provincial money under that new agreement and we have this. So, if we do not get it signed - but I am confident we will get it signed, at the latest, I would say, the first week in May. But we will carry on with this program. We will make sure that everything is exhausted there.

MR. HUNTER: Is it already earmarked for a specific area?

MR. WOODFORD: No, no. If the applications come in - for instance, from Springdale or Codroy or Cormack, wherever - we will deal with that until the funds are exhausted and then we will kick into the other program.

MR. HUNTER: The APF program. Actually, in the back of my mind I was thinking about the ten chicken producers on the West Coast. You just mentioned a few minutes ago about empty barns and so on, and we have ten producers that have a lot of infrastructure.

MR. WOODFORD: That's right.

MR. HUNTER: If that money is needed to be used so that we would not lose it, then are you, or will you, connect with the ten producers on the West Coast to see if there is anyway that you could help them get started in some other type of agricultural industry?

MR. WOODFORD: I am very familiar with those ten producers because they are all from my area, pretty well. And you right, there are empty barns here and there is a lot of idle land, but none of this money is allocated for that. That will all be taken up in the Safety Nets program.

Getting back to your question, your comments on that, some of those people have made applications for some of this new industrial milk quota. It depends on what the dairymen's association of Newfoundland, or dairymen's association, do with regards to accepting new applicants into that. Some of those people will be included in that.

MR. HUNTER: It is too bad they cannot find some way to stay in the agricultural business with the infrastructure they already have.

MR. WOODFORD: Yes, I know. I have been struggling with that for the last two years.

MR. HUNTER: There were some questions there on Animal Health, 3.4.01. There is a big increase in Supplies under 04. The question I had in my mind - that is increased by $1 million. I guess it is going to be pertaining to the rabbis situation.

MR. WOODFORD: Yes.

MR. HUNTER: The question I have in mind: How come the cost of this rabbis situation did not come out of wildlife budgets and it came out of your budget? Is that what that money is for?

MR. WOODFORD: Yes, that is exactly what it is for, the rabbis program. As you know, the department of wildlife and the Department of Health have been involved with this. We were chosen as the lead department to do this because of the veterinary services and the veterinary people involved with it, with the animals, and the trappers and so on. That is why we were designated at the lead department for that. That is where the monies are going, Ray, into that bait program and so on.

MR. HUNTER: I kind of thought it was, but I just wanted to be clear if it did.

I think that is it for me. I will pass it back to my colleague.

CHAIR: Mr. Hodder.

MR. H. HODDER: Thank you.

A couple of question, keeping in mind that we are approaching the regularly allocated time. I do not anticipate that we would want to stay beyond the three hours allocated.

I wanted to talk a little bit about the issue of farming again, because I was into that and then the Chair decided that he would move on somewhere else, and that is his right. In terms of getting extra forage, because that is a crucial thing in this area, in terms of - we know that the forage lands can be developed anywhere in Newfoundland, really, but there is also a concern that we have to have the manure management that has to be a part of that. What is the indication? What are the studies showing? How great is the distance in terms of manure management in terms of the forage lands to be developed?

We know there is a connection between the two but, for example, in terms of the economics of it, trying to haul manure to forage lands, is there a study done showing how far that can be done to be economical, and all that kind of thing?

MR. WOODFORD: There are limitations with regard to the spreading of manure. It is another good question because under our APF program, under the environment part of it, in fact, in the department now - as far as I am concerned, if I had the right in any supply managed area today, if a person is buying a quota and they do not have the land base for the spreading of the manure from that quota, then they should not have it. One of the reasons is, you have a real problem if you have a storage of manure and you do not have the land base to put it on.

MR. H. HODDER: That is right.

MR. WOODFORD: That is one of the things that will be addressed under this APF with regard to the environmental part of it and the land clearing basis, that you have to have....

The other thing that will be done under this APF, to address some of the problems that you are talking about, is the Environmental Farm Plans. I think every farm should have an Environmental Farm Plan. If they have one and the quotas come up, and land can be addressed, and, like I said earlier, if you have 100 head of cattle and you only have room to spread for fifty, what are you going to do with the other fifty?

MR. H. HODDER: That is right.

MR. WOODFORD: You still have to produce it. If you are in the egg business, it is the same thing; you have to have the land base. If you do not have the land base - and people are more aware and more cognizant of that today, Harvey, especially after Walkerton in Ontario.

MR. H. HODDER: Absolutely.

MR. WOODFORD: You have to watch your nutrients, you have to watch your samples, you have to watch your soil drainage, and all kinds of things like that. Regardless of the distance, that can be determined by the farmers themselves. I have seen people at home spread manure on eight and ten kilometres in the old days when you had the dry mature spreader. In a liquid spreader today you can take 2,000 gallons or 3,000 gallons more depending on the land, and you can haul it over the land if you have proper tractors. So that could be determined, but there is a limit. I tell you, it would have to be defined within the community, too. I think outside is out of whack.

MR. H. HODDER: The farmers I talked to said that once you get beyond twenty kilometres it is just uneconomical, even with the liquid or whatever form you are using. I am glad you went from what I said there into the whole issue of manure management, because this is a big issue environmentally, for water supplies, for the whole issue of farming, and how it is part of the whole network of things.

I was going to ask you the question about the standards. Are our farmers required to present an environmental plan, and how often? Who monitors that? Is that monitored by the Department of Environment or is that monitored, in your case, by Agrifoods?

MR. WOODFORD: Like I said, as far as I am concerned, every farm should have an Environmental Farm Plan.

MR. H. HODDER: Is the requirement now that they have one?

MR. WOODFORD: No, I don't think so. It is not there now, it is not required. That is one of the things that we are looking at under this program. Say, for instance, you came in for funding for land clearing, or for something else on that farm, well, you look at the farm. If you have an Environmental Farm Plan, we can deal with it, look at that and say: Harvey Hodder got that and we know what he is doing with it; we know where his extra manure is going.

If you don't have one, then we are going to want to know. We are definitely going to want to know, because of the streams, like you were talking about, the little brooks or whatever might be around, because you do not want it to come back to haunt you in a week or two weeks or two months down the road.

MR. H. HODDER: As you probably know, or someone would know, that is one of the reasons why we have been so cognizant in terms of my background with the Metropolitan Area Board working with the Bay Bulls water system and all the lands that have been frozen for potential expansion to that; you know, the Soldiers Pond area and all the area there. There is a tremendous amount of land up there that has all kinds of constraints on it.

When I grew up on the Burin Peninsula there was a very good agricultural community called Winterland, which is, I guess, connected to the Masters family. The Masters were great farmers, but over time that particular community has - I suppose farming has been de-emphasized. Just like when I grew up post-Confederation, my family, we were into certain businesses and we were encouraged to get out of that and get a real job. I guess that is what happened in the deputy minister's case too; they were pushed out of farming. The Masters family is just an example of some of the great successful farmers on the Burin Peninsula. In all sincerity, he knows that to be true.

What are we doing in places like Winterland, which was developed primarily in the 1930s with the Commission of Government? There were other places on the Burin Peninsula developed at the same time. All lands were opened up for agriculture.

In fairness, one of the great impetus in Newfoundland in terms of agriculture happened in the Commission of Government days. What are we doing to try and restore farming? In Winterland it is primarily root crops, but there are also some berries. Is there some program we have to reinvigorate that kind of a community that had a tradition, had a culture, of farming but to some extent that is being lost?

MR. WOODFORD: I see where you are coming from on that, but right now there is nothing in the department to take - I have seen places out our way too, to be honest with you, that are sort of getting lost, and I think out west there are probably a few places that could very well be looked back on as being food and agricultural areas, that have been sort of left by the wayside and left to die.

Right now I would look at it as entirely incumbent on the people in the community, if they want to revitalize it. We haven't got a program to deal with that in any municipality of the Province, no, to be honest with you.

MR. H. HODDER: The other question I had, flowing from the Member for Gander, when she mentioned several other crops there, raspberries and that kind of thing: How is the cranberry industry going in the Province. That industry started off a few years ago. What is the success rate and what is the growth potential?

MR. WOODFORD: Well, it is still in the development stage, as far as I am concerned. We have a few areas, one in the Terra Nova area, another one in the Bonavista area and one out west, the Lomond crop. His name is Paul Lomond. There are two out west. He had the first commercial harvest this year, very successful, I must say, a really successful harvest. He sold it all and got good prices. This is one of the years that prices were up. At you know, like everything else, like the paper industry, some years it is rock bottom, but this year the prices were up. He got really good prices for them. In fact, I have had some. I gave them to each member over there for Christmas. Those were the same berries and they were really nice berries, I must say.

Right now it is still in the development stage. We have still got money into it, and probably under the APF we will put a few more dollars into it. There is a great potential there, if the prices stay up.

MR. H. HODDER: I have two more questions, one that relates to root crops. We haven't talked much about root crops this morning. We seem to be losing a little bit in terms of our total production in root crops. Why is that happening? What strategies do we have in place to try to make sure that we are more self-sufficient?

MR. WOODFORD: We do not have a strategy, as such, to get into it. The only thing about it, that I am finding out our way, something like the dairy industry today and the root crop industry, I know in our community we used to have all kinds of small root crop areas, fields and farmers and so on. One thing I do notice today though with a root crop, is that anybody who is into mixed, if they are into root crop and into something else, like dairy or beef -

MR. H. HODDER: Like Brookfield Road -

MR. WOODFORD: Yes, they are usually fairly successful.

MR. H. HODDER: The Lesters have done a great job of that, combining the two.

MR. WOODFORD: Exactly, combining the two.

If they are into just root crop, a lot of people get disenchanted. I know in the fall of the year they sell - they have this small market on the side of the road. They do not keep a seller. They do not keep dealing with the Dominions and the Sobeys of the world. A lot of the people, the bigger ones in the Province, deal with them year round. When you get a supplier who is dealing with the Dominions of the world and you can come in and deal with them in February, March and April the same as you can when you take the crop out of the ground in July or August, September and October, they have a tendency to hold onto them. But the small root crop fellow - when I saw the figures were down this year with regards to root crop, I could see it in our area, a lot of the people just dropped off. A lot of the people who were into root crop alone dropped by the wayside or else they went into other fields, like - I did not mean to say fields, but into other areas. Swiss chard, for instance, broccoli, cauliflower, things like that. I know it is all considered there but those people excel in those particular areas.

The root crop stuff, I do not know what the answer is for it, to be honest with you. Unless they get into - and they have to get into it. To survive on root crop alone you have to go big. You have to go here, I am telling you, to survive on - because you get good prices for that short time and then all of a sudden it drops off.

MR. H. HODDER: It was very encouraging last fall when the Lesters brought out their corn. I have been over there on Saturdays, and people were lined up. One Saturday I was there and they were saying: No, you can only have three ears per customer. That is encouraging.

MR. WOODFORD: Yes. Marty, was it Kevin Williams who had that out there last year? He was really successful. I must say, the corn is something that has taken off. Not only is it good with regards to the householder, but for the dairy producer.

MR. H. HODDER: Absolutely.

MR. WOODFORD: Corn for grains, it is just unreal. You keep your protein up and you have a better milk production.

MR. H. HODDER: My last question involves a Labrador Métis issue. I got an e-mail this morning from Greg Mitchell - I suspect he sent it to everybody. It is about the issue of forest management. Their wish to develop their own forest products in Labrador, in use for Labrador, only for Labrador, and that kind of thing.

I was wondering if you have any comments on how we are going to be fair to the concerns of the Métis peoples in Labrador and others, and also keeping in mind the requirements that we have to keep our current industries going, for example, like the one in Stephenville?

MR. WOODFORD: Well, it is a challenge, there is no question about that. You take our deal with the Innu that we just finalized now, at the end of the day we only have a 200,000 cubic meter allocation for Labrador - that is North, in District #19. At the end of the day, when the bridge goes across the Churchill River (inaudible) - you have to remember, for Stephenville alone we want about 240,000 meters to 250,000 meters. Imagine!

Now on the South Coast of Labrador, which is primarily where the Métis are involved in all three districts: District #19, District #20 and District #21 - but primarily now in District #20 and District #21. We have people in Port Hope Simpson last year who sold, for the first time, pulp wood to Kruger in Corner Brook. They trucked it off the peninsula into Kruger in Corner Brook. We had wood barged out to Abitibi from that new wharf in Cartwright.

I was talking to some of the stakeholders just Saturday night in Gander. I spoke at the Newfoundland and Labrador Lumber Producers Association. This fellow Penny - I forget his first name -

WITNESS: Glen.

MR. WOODFORD: Glen Penny and his wife were there. In fact, he is on the executive this year. He is right gung-ho about getting into some of the new access roads and so on, and getting some of the timber.

So we have to balance that with the concerns of the Métis and with the concerns of the Innu. At the same time, you are right, it is a real challenge because as you know, there is all kinds of wood in Labrador, especially in the North. There are over-matured stands. There is boreal forest. It is left there just falling down. You have to cut it down, cut two or three butt junks on it before you get to a good part of the log. At the same time, I agree with their statement: Labrador first. Yes, I would be the first to agree. If you could utilize it in Labrador, whether it is through a sawmill, a pulp mill or whatever it is, yes, but then send the residue to the Island to a pulp mill because I cannot, in all honesty and sincerity, see anybody on the Island, or in Labrador, put up a place whereby - for years we watched the slabs go over the side of the bank. We don't do it. Everything now is being utilized. The co-gen in Corner Brook and so on. We can use everything, even the bark, the sawdust and the shavings. Everything is utilized once it comes out of the forest, and that is the way we have to see it.

If they can identify a way to utilize it in Labrador and have the residue come to a pulp mill on the Island, then so be it.

MR. H. HODDER: Thank you very much, Mr. Minister. That is all I have.

CHAIR: Thank you, Mr. Hodder.

Was that Mr. Mitchell, the pro forestry fellow you were talking about there? Yes, okay, now we have it.

Madam Clerk, I think we will move the subheads.

On motion, subheads 1.1.01 through 3.5.01 inclusive, carried.

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

CHAIR: I thank the Committee for their diligence in asking the questions, drilling the Minister to make sure that his officials and he were very prepared. They were very prepared.

Mr. Minister, compliments to your officials for this morning and the cooperation.

MR. WOODFORD: I want to thank the members of the Committee. There were good questions on both the forestry and the agricultural part of it. You are right - you alluded to it before, I think Ray alluded to it, Sandra alluded to it, and Harvey as well. The agricultural industry, especially, is not profiled enough. I have been saying it to people over the years. It has been really frustrating. Harry can remember back, way back around the Federation of Municipalities, we talked about agriculture - you cannot get anybody to -

MR. H. HODDER: (Inaudible) going back twenty-five years.

CHAIR: Thank you, Madam Clerk.

On motion, Committee adjourned.