CHAIR (Harding): Good morning, everyone.

I would like to welcome you all to the Resource Estimates Committee meeting. This morning we are debating the Estimates for the Department of Innovation, Trade and Rural Development.

We will begin with our usual introductions, I guess. I just want to remind you that, when you speak, you just press your microphone on and, when you are finished speaking, you have to turn it off; because, I think, with too many microphones on at one time it might cause some problems for the media people.

Anyway, my name is Harry Harding, Chair of the Committee and Member for Bonavista North; Judy Foote, the Member for Grand Bank; Ray Hunter, the Member for Windsor-Springdale; Charlene Johnson, the Member for Trinity-Bay de Verde; and Kevin O'Brien, the Member for Gander. Two other members, I think, will be joining us a little later -

OFFICIAL: They are on the way.

CHAIR: They are on the way? Okay.

- the Vice-Chair, Gerry Reid, the Member for Twillingate & Fogo; and Eddie Joyce, the Member for Bay of Islands.

Now, Madam Minister, if you would like to do your introductions.

MS DUNDERDALE: Thank you, Mr. Chair.

Good morning. It is a pleasure to be here this morning.

The officials accompanying me this morning are: Dr. Doug House, my Deputy Minister; Rita Malone, Assistant Deputy Minister for Regional Development; Phil McCarthy, Assistant Deputy Minister for Strategic Industries and Business Development; Bill Mackenzie, Assistant Deputy Minister for Trade and Investment; Cathy Duke, Executive Director, Ireland Business Partnerships; Ken Curtis, Financial Operations, Central Administration Division; Dennis Hogan, Assistant Deputy Minister, Innovation, Research and Advanced Technologies; and, at the table on the side, Lynn Evans, our Director of Communications.

CHAIR: Thank you.

Mr. Reid just joined us. I think you all know him.

I guess we are about ready. We have some kind of standard procedure that we try to follow, but it does not always work that way. We give the minister the opportunity (inaudible). Following that, then, we try to alternate ten minutes each but it doesn't really work that way. Anyway, we will see how it goes.

Madam Minister you may begin.

First, I will ask the Clerk to call the subhead.

CLERK: Subhead 1.1.01.

CHAIR: Subhead 1.1.01.

I ask the minister now to begin.

MS DUNDERDALE: Thank you, Mr. Chair.

I will not take all of my fifteen minutes.

The Department of Innovation, Trade and Rural Development has a pivotal role to play in shaping and improving the economy of this Province. We will identify new opportunities for economic growth, strengthen our rural communities, and develop strong regions.

The department is being allocated $43.6 million in 2005-2006 to allow it to implement its plans for economic growth and job creation for the Province.

The department has established an Innovation, Research and Advanced Technologies Branch to focus on high-growth opportunities, information technology, marine technologies, biotechnology, environmental technologies, defense and aerospace.

We are currently developing a provincial innovation strategy. As a government, we are very excited about implementing the strategy so that we can utilize the many advantages of research, technology and ingenuity in all regions and all economic sectors of the Province. One million dollars has been allocated in Budget 2005 to implement the innovation strategy.

Last month, we announced the details of the Comprehensive Regional Diversification Strategy for the Province. The plan builds upon the strengths of our regions and is complemented by government programs that will help develop those strengths so that they result in long-term sustainable employment for the people of this Province.

To further support the growth of the regions, government has established two funds which will address two significant economic development needs: business financing and community development. Government will establish a $10 million revolving fund to provide business financing to small and medium size businesses. The financing will allow eligible businesses the opportunity to start up and expand, thereby helping them create and retain long-term sustainable jobs.

The fund will target strategic growth sectors such as manufacturing, value-added production, IT and tourism. In particular, the fund will target businesses which have export potential and need assistance to enter or expand in external markets. The fund will be administered through the Business Investment Corporation, an arm's-length agency that reports to me, as Minister of Innovation, Trade and Rural Development. Revenue collected from the fund will be retained by the Business Investment Corporation for reinvestment.

This reinvestment in regions will further support business growth and expansion, especially in rural economies. To establish the revolving fund, government has added $7.9 million to the $2.1 million previously allocated for the Seed Capital Equity Program.

Government has also established a $5 million Regional-Sectorial Diversification Fund. Through this fund, government will provide non-repayable contributions for economical development initiatives that address regional and sectoral development, diversification and innovation.

Funding will be allocated based on criteria such as the project's ability to lever funding from other sources, and whether the project has tangible economic development benefits. The aim is to contribute to long-term sustainable employment and growth of small and medium size enterprises in each region. Details on program criteria for both of these funds will be released in the coming weeks.

Government has also increased the budget for our department's Business and Market Development Program from $500,000 to $1 million. The increase provides more assistance to new entrepreneurs and expanding small businesses to pursue new business ideas and new markets, including product development, implementing market strategies, and advancing new technologies.

Government has recently announced the structure of the Rural Secretariat that will work with local and regional partners to build strong and dynamic communities. It will comprise nine regional councils and one provincial council which will act as an advisory body to government, providing guidance on rural and regional issues in all parts of the Province.

The department will continue to contribute to the core operational funding of the Province's twenty Regional Economic Development Boards in the amount of $1.2 million. The work of the ministerial review committee, which has representation from my department, ACOA, the Federation of Municipalities, and the Newfoundland and Labrador Regional Economic Development Association, is continuing. The review is being conducted so that boards will have a sharper focus on the economic development agenda.

In November, the provincial government announced a five-year $1.5 million strategy to establish Newfoundland and Labrador as the centre of excellence in marine and ocean technology. We intend to capitalize on those strengths by making our marine technology sector the most innovative and the fastest growing in Canada. Budget 2005 allocated $338,000 for the marine technology strategy.

In January, a labour-sponsored venture capital fund was established in the Province. Through this initiative, local capital will be collected and invested in local businesses, which is good news for entrepreneurs with small and medium size enterprises.

In November, the provincial government announced it would increase funding for the Ireland Business Partnerships by $200,000 to $300,000 to increase efforts to identify, foster and promote trade and partnership opportunities with Ireland in the areas of business, education and culture. Budget 2005 continues that funding commitment.

In December, we officially launched Nearshore Atlantic to establish the Province as a recognized centre for information and communications technology development for COBOL and marine simulation. Nearshore Atlantic will pursue opportunities to attract business to the Province from markets around the world. Two hundred and fifty thousand dollars has been budgeted for this year.

In partnership with the Government Purchasing Agency, we are implementing a Supplier Development Initiative to assist businesses in bidding on government's goods and services. The overall goal of the initiative is to strengthen the relationship and understanding between public sector purchasing agents and private sector groups to facilitate the development of a local supplier development community. The Supplier Development Initiative will allow private sector firms to meet with public sector purchasing agents to learn about government purchasing requirements, and purchasing agents to gain an understanding of supplier capabilities within Newfoundland and Labrador.

Together with the Labour Relations Agency and the Department of Finance, the Newfoundland and Labrador Federation of Labour and the Newfoundland and Labrador Business Caucus, ITRD is moving forward with the Strategic Partnership Initiative, an initiative to build a consensus, an opportunity for collaboration with business and labour stakeholders around strategic issues facing the provincial economy. The initiative is facilitating work to assess and address factors affecting the competitiveness of the economy in global markets, including labour market development, investment capital, tax policy and labour relations.

We are moving ahead with the Red Tape Reduction Task Force. A committee of government, business and labour representatives will seek input from businesses and related organizations to identify inefficient regulatory and administrative red tape and recommend measures to remove barriers to business growth and job recreation.

In conclusion, Mr. Chair, I want to say that the programs we are implementing and continuing are based on sustainability and deriving long-term economic and employment benefits for people in all regions of the Province.

Thank you for your time, and I will be happy to answer any questions.

CHAIR: Thank you, Minister Dunderdale.

Mr. Reid.

MR. REID: Thank you.

Under 1.2.03., Policy and Strategic Planning, an extra $200,000 is allocated. I don't see what positions. They don't seem to be in the Salary Details on that page. Are you hiring some new people there?

MS DUNDERDALE: I just have to find out where you are now. What line again? Salaries, is it? Just give me the line again.

MR. REID: Yes, there is an extra $200,000 put in there, but there do not seem to be any Salary Details on that page.

MS DUNDERDALE: That is for temporary staff for the Red Tape Reduction Committee.

MR. REID: The what? The Red Tape Reduction Committee?

MS DUNDERDALE: To facilitate the work that is being done there. Also, there is funding in that line to fill a director's position.

MR. REID: Okay.

How many staff members do you have on that committee?

MS DUNDERDALE: My understanding is, there were three positions identified for the red tape reduction.

MR. REID: I like the name. The director is going to be - what director's position is that? Is there a Director of Red Tape Committee?

OFFICIAL: What we are talking about there is hiring a director for the policy shop. What was happening up until this past year, was that we had one individual, Terry Johnstone, who was basically playing two roles. As an Executive Director, he was both acting as the Director for our Policy Division and he was also acting as Director of our Advanced Technologies section at the time. What we are doing now, we have elevated the Advanced Technologies and Innovation into a branch with an Assistant Deputy Minister, Dennis Hogan, who is sitting over here. That means we have an opening gap that needs to be filled for the Director of Policy.

MR. REID: Thank you.

On the same 1.2.03. again. In the Estimates last year you had under Grants and Subsidies $186,000. That seems to have gone. That is grants for businesses. Is that eliminated?

MS DUNDERDALE: No.

MR. REID: They were eliminated from last year's revised.

MS DUNDERDALE: They were reallocated to Salaries and Operating because of the projected costs associated with the red tape reduction. The red tape reduction did not actually get off the ground. There was an allocation for red tape reduction in last year's budget and it was reallocated because we did not get the red tape reduction task force off the ground until earlier this year.

MR. REID: Subhead 1.2.04. There appears to be an extra $150,000 for Salaries, an extra $20,000 for Transportation and Communications, and $60,000 for Professional Services under Strategic Initiatives.

MS DUNDERDALE: Yes.

MR. REID: Where is all that going?

MS DUNDERDALE: Under 01., Salaries, that reflects the additional funding for the Ireland Business Partnerships and the reallocation of funds within the department to cover secretarial support for the Strategic Partnership Initiative.

Transportation and Communications, it is the provision of additional funding for the Ireland Business Partnerships. Just about all of those items, twenty-five, also reflects additional funding for the Ireland Business Partnerships. So the increase we made to the Ireland Business Partnerships are reflected in all of those line items.

MR. REID: Under 2.1.01., the Export and Investment Promotion. There is a $130,000 cut to Salaries, yet Purchased Services has been increased by $700,000.

MS DUNDERDALE: Yes, the savings were due to the strike and also some unanticipated vacancies.

MR. REID: How much are you saying you saved from the strike?

MS DUNDERDALE: Ken, can you give us the exact number there?

MR. CURTIS: In the 2004-2005 Revised there was about $55,000 in savings because of the strike.

MR. REID: Fifty-five thousand?

MR. CURTIS: There was also some unanticipated vacancies in 2004-2005, and in 2005-2006 some of those vacancies are going to be maintained there. So, the 2005-2006 is down as well.

MR. REID: All right, but let's go back to the question I asked now.

Under Export and Investment Promotion there is $130,000 cut to Salaries, right?

MR. CURTIS: Right. That is because some positions that went vacant in 2004-2005 are going to continue to be vacant in 2005-2006.

MR. REID: Okay.

MS FOOTE: Why is that, and what are the positions?

MS DUNDERDALE: You can speak to that Doug.

DR. HOUSE: Well, basically speaking, what is happening there is that we are in a little bit of a transition period because we think some of the investment attraction activity that has been done in our department up until recently, is probably going to be going to the Department of Business. So, we are not filling vacancies that we would otherwise fill until that gets settled.

MS FOOTE: What departments? Sorry.

DR. HOUSE: We will talk about that tomorrow.

MS FOOTE: I could not resist.

MR. REID: You are saying the positions that were eliminated will probably end up in the Department of Business?

DR. HOUSE: They are not positions that were eliminated. They are positions that are being kept vacant until we see the lay of the land, basically.

MS FOOTE: What are they?

MR. CURTIS: I do not know, Bill, if you could talk to that.

MR. MACKENZIE: They are the Industrial Development Officers, the GS-40 positions. There are a couple of those that have been vacant. So we will maintain the vacancies until the Department of Business is established.

MR. REID: But isn't the $130,000 in salary cuts removed from the heading now, Bill, or is it still in there?

MR. MACKENZIE: No, it is removed from 2005-2006. So, yes, we will have to revisit that, I guess, to see what we can afford.

MR. REID: When you say that they are not gone - if the money has been eliminated, you cannot say that they are still there if there is no money for them. Why, under that same heading, under Professional and Purchased Services, have you increased the amount there by $700,000?

MS DUNDERDALE: I will let Ken speak to it, but that is cash flow requirements out of our relationship with ACOA and our Canada/Atlantic Provinces Agreement on International Business Development.

Ken, you can speak to that more fully and explain it in more detail, but that is a cash flow issue.

MR. CURTIS: Just back to the Salaries for a second. That money is removed from this subhead in 05. and 06., but it is basically reallocated to elsewhere in the department. So it is not gone from the department's budget. They will use the fund in other priorities in 05. and 06.

In 06. and 07., this will get a part of the budget (inaudible) every year; the salary allotment or which positions that are going to be filled gets reviewed. Next year, it may be decided to fill some positions in this division and hold some other positions vacant, so to balance off the overall salary budget. So, the money is not gone from the department's budget.

MR. REID: You have me a bit confused because the deputy just said -

MS FOOTE: Three different answers.

MR. REID: There are three different answers to the same question, because the deputy said that the money was not really gone. The minister said something about these positions being transferred to the Department of Business. The deputy said something different.

MS DUNDERDALE: No, the minister did not say that. The deputy said that.

MR. REID: The deputy, I am sorry.

MS DUNDERDALE: The three of us have said that the money is still within the department. It has been reallocated. The money came from positions that are being held vacant until we see whether the role is going to be filled in INTRD or it is going to be in the Department of Business. We are in that transition; that decision has not been made. So, the money is reallocated elsewhere in the budget and we are expected to hold those vacancies through the coming months. We are not anticipating that we - but the money is still there in our budget.

MS FOOTE: It sounds like you are no clearer with respect to the Department of Business than we are. Is there a Department of Business? Have there been people hired? What relationship exists there?

MS DUNDERDALE: There is a Department of Business, and I understand the department will be appearing before a committee tomorrow. Is the department up and fully staffed and fully functional? No, not at this point. They are in a transition period. Gary Norris is the Acting Deputy Minister. The Minister of the Department of Business, the Premier, works very closely with INTRD. We expect in short order, in the next coming weeks, that department will be up and fully functional.

MS FOOTE: What will the relationship be with ITRD and...?

MS DUNDERDALE: Well, INTRD will still be the lead business department of government. We will do all of the research and the functions and maintain the bulk of the programing that we now have. Strategic Investment Regional Development, all of those functions, will all stay within INTRD.

MS FOOTE: How many employees are in the part of Business now, do you know?

MS DUNDERDALE: No, I cannot speak to that right now.

MS FOOTE: All right, I am sorry, go ahead. I apologize for jumping in -

MS DUNDERDALE: That's okay. I do not know if you want to address the issue of Purchased Services.

MR. REID: Yes, the $700,000. But before that, on the employees, did you say that you did not want to discuss that now in the Department of Business or you did not know how many were there?

MS DUNDERDALE: No, I understand the committee is going to appear before you tomorrow and that will be addressed then.

MR. REID: All right.

MS DUNDERDALE: Now, the cash flow requirements that show up under Purchased Services, Bill Mackenzie will speak to that.

MR. MACKENZIE: This is 100 per cent recoverable money from ACOA. If you look back at 2004-2005, the budget $259,000, there was no Federal Revenue down below. So we had to cash flow that through savings throughout the department. What we have done this year is added $500,000 to the Purchased Services but looking down at the Federal Revenue, that is all cost recoverable from ACOA. So it is just a means to simplify cash flow. Previously, we were searching for savings throughout the department to find means of paying the bills, which would, ultimately, be reconciled at the end of March. So, it is an in and out, just to assist us in cash flow.

MS FOOTE: But where did you find the additional money to put there to carry you over until...?

MR. MACKENZIE: That was an increase to the department's budget from Treasury Board. They permitted that since it was just an in and out.

MS FOOTE: (Inaudible).

MR. MACKENZIE: Yes.

MR. REID: 3.1.01. Under the heading Business Analysis, a $103,000 cut, is that right?

MS DUNDERDALE: Under Business Analysis, which line again?

MR. REID: I think it is under employees in (inaudible).

MS DUNDERDALE: Under Salaries?

MR. REID: Yes.

MS DUNDERDALE: That is because several budgeted positions were not filled and most of these positions will be filled this year in 2005-2006.

OFFICIAL: (Inaudible).

MS DUNDERDALE: No, will not be filled.

MR. REID: Not be filled, yes, that is what I was going to say. Can we, at some point in the next couple of weeks, have a list of the number of employees who have been cut?

MS DUNDERDALE: Sure.

MR. REID: And the positions they occupied, as well as any new ones, if you have already decided on that, positions that will be created?

MS DUNDERDALE: Yes.

MS FOOTE: And any vacant positions as well?

MS DUNDERDALE: Yes, that is no problem.

MR. REID: The same thing, I think, under 3.1.02. Under Investment Portfolio Management, there seems to be some positions cut there as well.

MS DUNDERDALE: Well, there are a number of vacant positions and we are still holding them vacant. As well, there were savings due to the public sector strike.

MS FOOTE: Would you be holding those vacant again in keeping with what you are doing for the Business Department? Is that the same approach there?

MS DUNDERDALE: No.

MR. REID: All right. So you will give us a list of all those.

OFFICIAL: No, they are not related to the Department of Business at all. That is the portfolio management down in Marystown.

MS FOOTE: Okay.

MS DUNDERDALE: The number of accounts are coming down, so we do not require these positions to be filled at this time. However, we are not prepared at this time to say that we will not need them in the long-term, so we are just holding them vacant for the moment.

MS FOOTE: How many positions?

MS MALONE: Two positions.

MR. REID: The same question, I guess, under 3.1.04. Strategic Communications and Promotions, there seems to be $63,000 gone out of the positions there as well.

MS DUNDERDALE: In Salaries, under 3.1.04?

MR. REID: Yes, Strategic Communications and Promotions.

MS DUNDERDALE: We have been looking for operating efficiencies there and that is reflected in the budget. Doug will also speak to that.

DR. HOUSE: Just to add to that, what happened last year, after our budget had been allocated we were able to negotiate with the HRSD for some extension of some funding under the Labour Market Development Agreement. So we ended up not having to use the full allocation there on Salaries. We were able to save a significant amount of money there, almost $300,000, but that only lasted for half the year and we do not have that this year. This is why the figure has increased again for 2005-2006.

MR. REID: All right, that is pretty well it for me, but I want to ask you a general question because I am sort of lost as to what you are doing with the department. It seems to be, like you said, still in a state of flux.

I had a question from a local development association in my district. I had a meeting with him recently and I asked, basically, where they fit into the whole scheme of things now because it used to be the development association and then the RED Board in Gander, I guess, was the one that they were tied into. Where do they fit now in the whole scheme of things because you have this strategic economic committee?

Are you going to keep the RED Boards as well, and development associations, and anyone who would like to deal with government, or to go and look for funding from a development association such as the one I have in my district - it is probably one of the best in the Province. They have operated for quite a long period of time and, as far as I know, they have been self-sufficient for a number of years. Where do they fit into the whole scheme of things now?

MS DUNDERDALE: It is no different from your time in government. Those organizations have been around - rural development associations - for a long time. Under Premier Clyde Wells, he and his government felt that there was a better way of doing regional economic development, first of all, in consultation and in co-operation with the Newfoundland and Labrador Federation of Municipalities as well as the provincial organization for rural development. I think Dr. House actually had something to do with the task force that was put together, and out of that task force came the twenty regional economic development committees that were supposed to consume, as I understood it, the rural development associations. I knew something about it because I was President of the Newfoundland and Labrador Federation of Municipalities when the initiative began.

The REDBs got up and got underway. Funding was taken away from, as I understand it, rural development associations, but they continued to exist in some form or another and they play a role in communities. Some of them are very effective. Others are, much like the REDBs, not as effective. They do not receive any core funding or operational funding from government. Regional Economic Development Boards do, as you know, $1.2 million. We continue to fund Regional Economic Development Boards.

In terms of community-based regional economic development, our support is continuing. This government believes that we have to have regional economic development and we still support our Regional Economic Development Boards, REDBs.

There is a ministerial committee in place now, in partnership with NLREDA and the NLFM, ACOA and ourselves, to see if we can bring a sharper focus to REDBs and to review after seven years. They feel, as we do, that it is time for a review. They know there are some challenges around the way that they are doing the work, their mandate and their structure, and in partnership with the two levels of government and the Newfoundland and Labrador Federation of Municipalities - the largest number of their stakeholders around the Province come from that organization - they are working in partnership to have a look at, to review the structure and mandate of the REDBs and make them more effective organizations for community-based economic development.

Development associations have applied for funding for projects that they have applied to us to leverage money out of either ACOA or Industry Canada. There was no funding available for quite some time, other than under the Community Economic Development Program that we talked about last year. There were serious problems with that program. It was not advertised, the criteria were unclear, and there was only $460,000 in it. There were over 3,000 applications on file, when I came to the office, that had not been notified whether or not they qualified for funding under CEDP. I certainly did not advocate for that program. That was not a program that I was prepared to support or look for further funding for; however, we did go and make a submission to government and to Cabinet for funding for regional economic diversification and leverage funding for organizations like REDBs and like rural development associations, and from that we have the $5 million Regional Diversification Fund. Rural development associations are just as able to apply for support from that fund to leverage out projects as any other organization in the Province.

MR. REID: You are saying there is going to be a review of the REDBs.

MS DUNDERDALE: The REDBs are engaged in a review. It is a partnership. REDBs do not answer to government, other than around their core funding. That is used for what we contracted for that money to be. REDBs answer to their stakeholders and community. They do not answer to government. Anything that we do with REDBs, we have to do in co-operation and in partnership with them. Through the last year and a half we have developed a very good relationship with NLREDA, and I have met with all of the REDBs, I have met with all of the Chairs, and this ministerial committee has arisen in a co-operative way. The committee itself sets the parameters of what it is that they are going to do.

MR. REID: All right.

MS DUNDERDALE: The whole idea is just to bring a sharper focus to economic development.

MS FOOTE: How long is the review supposed to take?

MS DUNDERDALE: The review should be complete in the fall.

MR. REID: Under the Rural Secretariat - I just want to figure it out, because it was never very clear to me - if there is a group like the Development Association on New World Island, and they want to get some money from whatever level of government, normally they would go to the RED Board to look for support for that, am I right?

MS DUNDERDALE: Sometimes they would. Sometimes they would come directly to government.

MR. REID: That area there - I forget the name of the larger one - never worked very well, from my perspective anyway. Now you have how many of those, nineteen RED Boards?

MS DUNDERDALE: Twenty.

MR. REID: Twenty.

This Rural Secretariat now -

MS DUNDERDALE: Does not have anything to do -

MR. REID: How many of those are going to be out there?

MS DUNDERDALE: Nine, but they do not have anything to do with leveraging money out of government. They are two completely separate things.

MR. REID: What is going to be their role, then?

MS DUNDERDALE: What we are doing is building on the work of the Strategic Social Plan, in which you had six committees operating around the Province, in six regions of the Province, in terms of the social economy in the main, but eventually, as the SSP evolved, as I understand it, and keeping a fairly close eye on it because I worked in community most of my life and I was very intrigued in the whole SSP process, and I though it was a very good plan, it is evolving, that plan, to create a process where people who are involved in economic and social development in different regions of the Province have a process where they can come together, first of all, to develop a regional vision. They bring all of their own expertise togther.

For example, on the Burin Peninsula, they would come together and they would talk about what they need to do to live a healthy life on the Burin Peninsula. What do they need in education? What do they need in health care? What do they need for economic development? How could 30,000 people live good, healthy lives on the Burin Peninsula? What would be that vision? And to create a process, then, through the Provincial Council of the Rural Secretariat, to ensure that information comes directly up to government, and that grassroots experience and grassroots knowledge and grassroots people have regular access to government so that they can influence policy and program development at the very beginning.

That is what the Rural Secretariat is. We are not interested in a Premiers' Council that the Premier may or may not attend. You know, three times in the last two years, of seven or eight meetings, the Premier attended the Premiers' Council. We want to have a mechanism where regional differences - because we talk about it all the time, how one size does not fit all - the different flavours, the different experiences, the different realities of different parts of the regions of this Province, we have created a process where that knowledge and that experience can be brought right to the Cabinet table twice a year, that people from all of those regions have influence regularly - not every four years, but on a regular timely basis - they have the opportunity to be proactive in influencing government policy in program development.

Nobody goes to them for funding any more. They will have project funding, the same as the SSP did. They will have a planner. The nine regions will have a planner, the same as the SSP did, the committees did, and that is because, if they want to know what is happening around education - because most of this work is based on evidence-based research - they will have the same allocation of funding and the same expertise available to them to gather in the knowledge or study particular aspects of the economy, the social economy, or whatever it is they need to look at, that they have the opportunity to do that so they can do their work in a really comprehensive and well-informed way.

MS FOOTE: Is there a focus with this group to look at the economy as well as social...?

MS DUNDERDALE: Yes.

MS FOOTE: Did you give any thought at all to looking at REDBs and these nine regions, and somehow bringing them all together rather than having -

MS DUNDERDALE: No. I do not know if the ministerial committee will go there. They have set out the parameters of their work. As I say, that is being done in partnership, and the committee has set the parameters of its work. Whether they will go there at the end of the day, that is what we will have to wait and see.

In terms of what directed our work, and how we came up with the nine regions, it was an in-depth piece of work that has gone on for months and months within the department. All of us know that there are natural regions of this Province. I have lived in rural Newfoundland all of my life, just about, other than the last nine years. All of it was spent in rural Newfoundland. So you know, in terms of yourself, when we talk about the Burin Peninsula and what is it we are referring to, and what is a natural fit for us, we know, intrinsically, from our own history and our own culture and so on, what that means.

MS FOOTE: That Clarenville is not the centre.

MS DUNDERDALE: That is right.

While it might appear to somebody that the Bonavista Peninsula and the Burin Peninsula may have a lot in common, for people who live on both those Peninsulas, that might not be true for a number of reasons.

What we did was, we did some in-depth research. The first thing we did was, we went back and we went to hospital and clinic records to say: Where do people get their health care services? We started with that basic principle, and then we started to draw a map. The people who live in this area, where do they work? Where do they get other services? Where do their children go to school? Almost naturally, the nine regions fell out. We were looking for percentiles like 90 per cent of the people who work in this area live in this area. Once we had that piece of work done, it looked pretty good to us, but then we knew we had to test it against the people who lived in the regions, and that is what we did. We took it back to people all over this Province and said: Does this make sense to you?

MS FOOTE: What are you doing to educate members of the REDBs about your plan, about the process? Because I am getting a lot of representation from members of REDBs saying, we do not know where we fit into this. You know, there is confusion out there. There is doubt out there. There is concern out there.

MS DUNDERDALE: Well, I have done more talking about the Rural Secretariat to REDBs, I expect, than I have done to any other group. They have been consulted more widely than any other group in the Province. I have had an opportunity to speak with all of the Chairs. We attended their AGM in Rocky Harbour earlier this year, and spoke at length.

They fit in this plan the same way they fit in the SSP committees. What we have done is evolved the SSP. The SSP, right there on their own - there wasn't any great carryover, from my understanding, from the SSP to the Premiers' Council. The SSP were working, and they reported to the secretariat within government, but they had no access to government, to caucus. They had to get in a lineup, the same as anybody else, to bring their knowledge and any information forward.

What we are trying to do is evolve that now so that, when you ask these people to be engaged and to share their experience and their knowledge and their best ideas with us, we provide a process and that gets to where it needs to go.

MS FOOTE: Let me just move on to another area. I think one of the problems that I see with the government, and probably it is something that you are grappling with as well, but a lot of the decisions that are being made do not seem to take into account the impact that they are going to have on rural Newfoundland and Labrador, the negative impact, and I alluded to that yesterday.

I am just wondering, I know when we were a government, part of the decision-making process was we always factored in what impact a decision by any department would have on rural Newfoundland and Labrador. I am just wondering if that is something that you have tried to insert into the process from your perspective, being the minister responsible for rural development, because we have seen some things happen that if you look across the board - and rural communities are really having a difficult time. Apart from economic development, there are things that are happening in those communities that are really - you are going to see so much out-migration as a result of those decisions.

MS DUNDERDALE: There is no doubt that rural communities are under distress. That is not only true for Newfoundland and Labrador, that is true for Canada and that is true for Ireland and that is true for Iceland.

MS FOOTE: Yes, but we have to deal with Newfoundland and Labrador.

MS DUNDERDALE: Absolutely, and that is what we are doing. Yes, we do take into account all the time, not only myself as minister responsible for rural development, but other caucus members and other cabinet ministers around the table. It is a very serious issue when there is any loss anywhere, but particularly in rural parts of the Province. However, given the fiscal situation that we have had to deal with last year, that there was a rationalization and a consolidation that was required -

MS FOOTE: But this is a new year, Minister, and we are not in that same fiscal situation.

MS DUNDERDALE: No, that is right, and that is why we have increased economic development monies from $2.6 million to almost $16 million. Now there has been an erosion of money in economic development over the last ten years by the former government, from $26 million on an annual basis down to $2.6 million, and that has had an impact. That has had an enormous impact on economic development all over this Province.

MS FOOTE: You are losing sight of my question.

MS DUNDERDALE: No, I am not.

MS FOOTE: I am not talking about economic development.

MS DUNDERDALE: I am not. What I am saying is -

MS FOOTE: I am talking about other decisions that impact negatively. What I am asking you is that if the government has a policy whereby they are looking at whether or not they are going to reduce services that are so vital in rural Newfoundland and Labrador -

MS DUNDERDALE: It is not a matter of reducing services, with all due respect.

MS FOOTE: But they are being reduced. Face the reality, they are being reduced.

MS DUNDERDALE: Services are being consolidated and they are being rationalized. Sometimes you -

MS FOOTE: That is a good word for reducing.

MS DUNDERDALE: But we are not going to be able to have a school in every community, a hospital in every community, a government office in every community.

MS FOOTE: You have a highway depot though, especially going down the Burin Peninsula.

MS DUNDERDALE: We are 500,000 people spread out over a vast geographical distance. We are in severe fiscal -

MS FOOTE: Now you are not sounding like the Minister of Rural Development. Now you are sounding like the minister of economic development.

MS DUNDERDALE: No. What I am -

MS FOOTE: I am just suggesting to you, there is a different focus.

MS DUNDERDALE: What I am is a minister who is responsible for rural development and has to do her very best to work with government to ensure that we have a sustainable economy, a real economy. Our vision is, for every job that is lost, to ensure that there are two jobs put back there to replace the job loss. So, you are always sensitive to any erosion of employment in rural communities, but we are identifying the strengths of communities, the opportunities for economic diversification and economic growth in communities. We are providing government funding, the mechanisms. We are working with our private partners to ensure that funding is available. It is not government that drives the economy of rural Newfoundland, not to date. Small business -

MS FOOTE: But it is decisions of government that impact negatively on rural Newfoundland and Labrador.

MS DUNDERDALE: Small and medium-sized businesses ought to be driving the economy, and do drive the economy of this Province. We have to find ways that we can help Newfoundlanders and Labradorians grow small and medium-sized businesses and have a sustainable economy built on the strengths of their regions. That is the focus of this government, to maintain government jobs where we can.

MS FOOTE: Explain to me what the Member for Gander means when he talks about hub. What is a hub for a region?

MS DUNDERDALE: Well, in terms of what we speak, I talk about clusters. All our research, research done at home as well as research that we have done around the world, shows us that rural communities, smaller communities survive when they have a strong urban core. I use all of these terms, like urban and so on, relatively given that we are in Newfoundland and Labrador. I mean, we came back off a trade mission last week, four Atlantic provinces, and we had between us all less population than the city we were in. So I am speaking very relatively, but perhaps my colleague, Paul Shelley, put it best: When Baie Verte is doing well, the other twenty-two communities on the Baie Verte Peninsula are doing well.

We are not going to be able to put a government job, or there may not be a full array of services in every community. You may live in community A, you may work in community B, the industrial piece -

MS FOOTE: It sounds like a speech I gave.

MS DUNDERDALE: Well, the thing is, we are going to make it a reality. You are going to get a number of services in the region but you are going to have access to services. I mean, it is back to that whole concept again around the Rural Secretariat. What is it that we need to live healthy lives? How can we have reasonable access to services? It does not mean the services are going to be in your community but it has to be within a reasonable time and distance from your community and so on.

MS FOOTE: Listen, I am not disagreeing with (inaudible).

MS DUNDERDALE: That is where our focus has to be, and around sustainable economies. When we look at where the opportunities are - because we have been doing the drill down for the last sixteen months. We have been working with the Economic Initiatives Committee of Cabinet that the Premier established. So we are combing through departments all the time. We are doing the homework to ensure that opportunities which are identified are real opportunities, and we are working with stakeholders in the region to exploit those opportunities and to maximize the benefits to the people in the region. That is where our focus has to be.

MS FOOTE: Nobody expects - I do not even think people in rural Newfoundland and Labrador expect that they will have all the services in all of the communities. Clearly, they acknowledge that, just as we did some decentralization of government services and put the investment portfolio down in Marystown. The choice was Marystown, and not in Grand Bank or Fortune or wherever, and I was instrumental in doing that.

MS DUNDERDALE: Sure. Certainly.

I remember the customs office coming out of Burin and going to Grand Bank and going to Fortune and the great hullabaloo when we put it. Yes, it is painful when it happens, but it has been happening for a very long time.

MS FOOTE: That is right, yes, and nobody, I think, expects that there will be a school in every community. It is just not possible to do that and we do not have the student population to it.

Having said that, I go back again - and the reason I continue to harp on government is because you are the Minister Responsible for Rural Development and to me that is crucial in Newfoundland and Labrador. I look at Lamaline, for instance, where we have six families now leaving because they worked at the fish plant in Fortune and because that fish plant now, it is very likely it is going to close. Unfortunately, government has not held FPI accountable and they could have. I look at those rural communities, and when we talk about opportunities, I do not know what else they are going to do. Well, they are not going to find any job in Lamaline. The job would have been in Fortune. Now, that is gone.

MS DUNDERDALE: They may not. And there was a time when they found a job in Lamaline and they did not have to go to Fortune, but I understand that.

MS FOOTE: Well, in the fishery, right?

MS DUNDERDALE: Yes, absolutely in the fishery. I mean the same thing happened in my hometown of Burin. When we went from primary processing they were going to close our plant. The same thing happened in Trepassey. I mean in lots of ways we are subject to what is happening in the world and world markets and all of those kinds of things, and all of that influences.

MS FOOTE: Now that is Derrick Rowe's speech. That is the apologist for FPI.

MS DUNDERDALE: But it is important. You cannot live in a bubble. We are in a real world. There are things that are happening that, unfortunately, we do not have a great deal of influence over, but to say that we don't understand -

MS FOOTE: But we could have, with respect to FPI, but that is a debate we can have another time. Clearly, I would have thought that, being the minister responsible for rural development, that would have been one of the things that - because it is not just going to be Harbour Breton and Fortune. It is going to be Marystown. It is going to be Bonavista. They are on record already as saying that they are going to reduce the number of processing plants in the Province.

MS DUNDERDALE: Absolutely, and we realize that.

MS FOOTE: And, for me, it is not fair. FPI was created for the very reason to ensure that there was a social conscience there in rural Newfoundland and Labrador with a fishery (inaudible) should be able to survive.

MS DUNDERDALE: But it also has to be a viable company. The same thing that we went through back in 1984 and 1985 when there was that whole rationalization of fisheries and consolidation. Primary processing was taken out of Burin, and workers had to move to Marystown. We went from a workforce of 600 to - workers had to move. Fish plants were closed in Trepassey. I mean, all of those things have been happening for a very long time.

MS FOOTE: The only difference is, is that it is an act of Legislature with respect to FPI.

MS DUNDERDALE: Yes, absolutely. I agree.

MS FOOTE: That is the difference here, and the fact that FPI was created by taxpayers' dollars and there was a reason for that. I guess what I am saying is that the government needs to, and you need to, be looking at this and looking at what some of the corporations are doing. It is a different business. FPI is a different business. And, yes, I know businesses need to make profit. There is nothing wrong with profit, but, at the end of the day, how much wealth is too much wealth, or how much wealth is enough for the shareholders? I am thinking about those Newfoundlanders and Labradorians who live in rural Newfoundland and Labrador and really do not know. Even in your own document that you put out with respect to out-migration, you see it continuing.

MS DUNDERDALE: Out-migration - I mean, I wish that the numbers that you have been touting around were correct.

MS FOOTE: So do I.

MS DUNDERDALE: Everybody in the Province would be happy if out-migration would stop and, in fact, we had an in-migration of 300 people.

MS FOOTE: But one of the ways to ensure that it does not happen is to deal with companies like FPI.

MS DUNDERDALE: We have never stopped out-migration. You could not stop it.

MS FOOTE: But we have to try.

MS DUNDERDALE: We are trying.

MS FOOTE: That is the objective.

MS DUNDERDALE: That is exactly it, and that is why we have gone from a $2.6 million investment in economic development in this Province to a $16 million investment in economic development. That is why we had things like our diversification plan, where we know where the real opportunities exist. That is why we have a labour-sponsored venture capital fund. That is why we are working with the Federation of Co-operatives to ensure that we can get our micro-lending program.

MS FOOTE: I couldn't agree more with your labour-sponsored investment fund.

MS DUNDERDALE: All of these things are important, to have a whole spectrum of funding mechanisms so that small and medium size business - because that is where the heart of our economy is. That is where the driver of our economy is, and that is where we have to focus a great deal of our attention.

MS FOOTE: Do you want to elaborate on the sponsor - the labour market development?

MS DUNDERDALE: GrowthWorks.

MS FOOTE: Yes.

MS DUNDERDALE: It was registered in the company, so Phil can speak to it. Phil was very much involved.

It will be another year, I expect, before they will start to make investments in the Province, but 75 per cent of the money raised in the Province will have to be invested in the Province. They will have a local advisory group who will direct investments in the Province. They have not released the amount of money they have raised since the fund was registered, other than to say that they are very, very pleased with the way - so GrowthWorks is delighted with everything that has happened to date.

I don't know, Phil, if there is anything else you want to -

MR. McCARTHY: Not really. We meet with GrowthWorks regularly. They were down a couple of weeks ago and they are very pleased. They are putting together their marketing plan for this year now. They plan to be very aggressive. ACOA has also provided some funding to the Federation of Labour so they can hire a person so they can work with GrowthWorks to market it that way. They are really looking forward to a good year.

MS FOOTE: What is the focus, Phil? Is it looking at your strategic industries, the ones that you have identified?

MR. McCARTHY: If you look at the legislation, they have to look at strategic growth sectors. A lot of things they cannot do, ordinary retail and wholesale and stuff like that. They have to invest in strategic growth sectors of the Province.

MS FOOTE: Another initiative, I guess, of the department that I am interested in pursuing is with the whole area around immigration, and where we are with that.

MS DUNDERDALE: The Provincial Nominee Program?

MS FOOTE: Yes.

MS DUNDERDALE: We have 400 units that have been allocated under - and we spoke about that last year in the Estimates.

MS FOOTE: We have 400 units?

MS DUNDERDALE: We had 400 additional units last year.

MS FOOTE: How does that compare with the other provinces? I am just trying to remember now.

MS DUNDERDALE: Bill?

MR. MACKENZIE: I am not sure. I will check. Generally, it is proportionate throughout the country but I do not know precisely what the other provinces have.

MS FOOTE: Because it was an issue, remember, with respect to getting more units? Was it P.E.I. or some others that had close to 1,000 units? We were hoping to get more, I know. I am just wondering.

MR. MACKENZIE: The 400 are new units. It could be other provinces have more, but we would not be restricted. We probably only asked for something like that. If we wanted more, I am sure -

MS FOOTE: You can ask for more.

MR. MACKENZIE: Yes.

MS DUNDERDALE: We have not used up those units yet.

MS FOOTE: What is the criteria?

MS DUNDERDALE: Very strict.

MR. MACKENZIE: Well, there are three categories. You can come in as a skilled occupation. That could be trades, medicine, what have you. You can come in as a -

MS FOOTE: Is it broken down, a percentage for...?

MR. MACKENZIE: No, you can use the 400 for any. There are skilled trades. You can be in an investor category, where you invest in an existing business, or an entrepreneur category where you are actually starting a brand new business.

The difference now from formerly is clearly the investor categories have to take a direct management or a direct role in companies. The passive investment of the past is no longer permitted by the federal government.

Those are the three categories. The predominant activity -

MS FOOTE: Would they have to actually move and live here?

MR. MACKENZIE: Yes, they have to live here now.

MS FOOTE: They cannot just buy a piece of real estate on the West Coast.

MS DUNDERDALE: No, they cannot, and they not only live here but they have to have an active management role in the company.

MR. JOYCE: I have a few questions.

First of all, do you know how much money FPI made last year?

MS DUNDERDALE: No, I do not know.

MR. JOYCE: I don't want to be argumentative.

MS DUNDERDALE: I am not responsible for FPI.

MR. JOYCE: No, no, but I am just saying here you are giving us a speech. I travelled with the FPI committee, and every place we went into, the minister, (inaudible) the minister now, said no plant should be closed down. Here you are, as Minister of Innovation, Trade and Rural Development, giving us a lecture, in my opinion, about how a company has to be profitable, and you do not even know how much money they made last year. They made millions upon millions upon millions. So, here you are, carrying a line for FPI against rural Newfoundland.

MS DUNDERDALE: I am not carrying a line for FPI against Newfoundland. I am speaking to my responsibilities as the Minister Responsible for ITRD and what it is we are doing for rural development in Newfoundland. I do not have the responsibility for FPI, or to direct FPI in any kind of a way.

MR. JOYCE: Your government does, though, Minister.

MS DUNDERDALE: My government does, yes, and when I have the opportunity to speak to it then I do.

MR. JOYCE: So, you have no idea.? So, the speech that you gave -

MS DUNDERDALE: I cannot give you the dollar amount of profitability of FPI at the table here this morning.

MR. JOYCE: Okay.

So, when you were just speaking to the Member for Grand Bank and you were saying that a company has to be profitable -

MS DUNDERDALE: I am talking in general terms.

MR. JOYCE: Can I ask a question?

MS DUNDERDALE: Sure.

MR. JOYCE: - and you were telling the minister the company has to be profitable, you have no idea if the company is profitable?

MS DUNDERDALE: Yes, I have an idea that the company is profitable. That is not the question you asked me.

MR. JOYCE: So, they are profitable.

MS DUNDERDALE: You asked me how much profit did they make, and I told you I could not give you the exact amount.

MR. JOYCE: The production crab quota - and you just mentioned that one of your programs that you have is the social economic development of rural Newfoundland and Labrador, the health issues. Your department - I am sure you did - did you do a social or an economic study on the results of the production crab quota sharing for rural Newfoundland?

MS DUNDERDALE: No. Nor did I say that my department was doing a social and economic analysis connected with the rural development associations.

MR. JOYCE: Strategic plan, was it?

MS DUNDERDALE: Our rural diversification plan identifies strengths around the Province. In terms of impact analysis and so on, on specific plant operations or policy with regard to fisheries, will be done in the Department of Fisheries and Aquaculture.

MR. JOYCE: So, you guys did not do any social plan or economic plan of rural Newfoundland, the devastation of rural Newfoundland if this goes ahead? There was none done. That is all I am asking.

MS DUNDERDALE: No, there was no analysis done in my department on crab.

MR. JOYCE: Okay.

The Department of Business, as you just mentioned, is not set up yet?

MS DUNDERDALE: It is functional. It has a deputy minister. The CIO was operating within the Department of Business and has now been transferred out to Executive Council.

MS FOOTE: Who is that?

MS DUNDERDALE: Peter Shea, the Chief Information Officer.

MS FOOTE: So, he is no longer with the department; he is with Executive Council?

MS DUNDERDALE: He has moved into Executive Council.

MR. JOYCE: Are there any funds in your department that are going to be transferred to the Department of Business, or does it stand alone now?

MS DUNDERDALE: It stands alone.

MR. JOYCE: It stands alone right now, okay.

MS FOOTE: I am sorry, Eddie.

What is Peter doing in Executive Council? Do you know?

MS DUNDERDALE: He is the Chief Information Officer for government.

MS FOOTE: For government.

MS DUNDERDALE: He looks at the technological needs of government, communication needs of government.

MS FOOTE: Okay.

MR. JOYCE: In the Strategic Enterprise Development Fund, there is an increase there of almost $10 million or $11 million. Are there any applications for that? Because there are businesses that have been phoning me and the only information I can get from the department is, phone someone at the department. Are there any applications? Can I get some applications?

MS MALONE: This is rolling down to the next days and weeks.

MS FOOTE: Days or weeks?

MS MALONE: Within the next day, the next couple of weeks, we are concluding our policy and have all our literature ready to roll out. In the meantime, we are taking applications for funding. We are able to take business plans, provide counselling, and work on files.

MR. JOYCE: Can I get a copy or number of the proposals, applications, when they are sent, so we can have them for our office?

MS MALONE: Certainly. They will be posted on Intranet and the Internet. They will certainly be available.

MR. JOYCE: My last question is: Last year, I asked for a copy of the people who were being hired in Corner Brook, and the people being laid off, and I never did receive it.

MS DUNDERDALE: Okay, I will see that you get it.

MR. JOYCE: For this year also?

MS DUNDERDALE: Yes.

MR. JOYCE: There was information last year that I requested that was never, ever received. If I could get the same information this year: the people who were laid off, any new positions hired, and what the positions are?

MS DUNDERDALE: Yes.

MR. JOYCE: Thank you.

MS FOOTE: I am just looking again down through the salary component in the department under the Minister's Office. I see a Director of Communications. Do you have a public relations specialist?

MS DUNDERDALE: I have my Director of Communications, Lynn Evans.

MS FOOTE: I know Lynn.

Do you have a public relations specialist?

MS DUNDERDALE: Yes.

MS FOOTE: Where is that in the Salary Details?

MS DUNDERDALE: Ken?

MR. CURTIS: As I understand it - I will check the Salary Details - I think that is a temporary position so it does not show up in the Salary Details, but in the salary budget it shows up under the Strategic Communications and Promotions activity subhead.

MS FOOTE: It is a temporary position?

MR. CURTIS: I think so, but I will double-check. I have the Salary Details. I will have a quick glance.

MS DUNDERDALE: Doug can speak to that, Ken.

DR. HOUSE: At the moment it is a temporary position, but there is process going on now whereby we are making it into a permanent position. We are in the process of hiring now for that position.

MS FOOTE: So, it does not show up in the Salary Details?

DR. HOUSE: It does not show up now because it is a temporary position.

MS FOOTE: Okay.

When will that be made permanent, Doug?

DR. HOUSE: As soon as we get through this hiring process.

MS FOOTE: I guess you are in the middle of interviewing now.

DR. HOUSE: We have not started interviewing, but we are getting applications.

MS FOOTE: Okay.

I am just looking at Purchased Services. I notice in some areas we have seen an increase - a big increase in some. I am just wondering, for your Purchased Services, do you tender those or are the majority of them people you know who are working in some distinct area that you think would be appropriate to hire?

DR. HOUSE: What we do in Purchased Services in all cases is to adhere to government guidelines - not guidelines, I guess, regulations. Beyond a certain amount, which I am not sure off the top of my head, we always tender.

MS FOOTE: Is it $50,000 or $5,000?

DR. HOUSE: It is more like $50,000.

OFFICIAL: It varies, depending on whether it is something that you are doing under the Public Tender Act or whether you are doing it for hiring a consultant, and there are guidelines for that so there are different rates, different limits.

MS FOOTE: I think Susan Sherk has been -

OFFICIAL: That was tendered, and there were a number of applications for that.

MS FOOTE: Adelle Poynter as well.

OFFICIAL: The same thing, yes.

There was a process. There were interdepartmental committees that reviewed all of the applications.

Just for the record, I had nothing to do with either of those decisions.

MS FOOTE: I am not saying they were bad.

OFFICIAL: I know. I am just explaining.

MS FOOTE: They are good people. I am not saying they were bad. They were just a couple that came to mind.

How many contracts have been awarded by the department under the heading of Professional Services? Do you have any number on those?

OFFICIAL: Not off the top of my head.

Ken, do you have any -

MR. CURTIS: No, I do not know right off, but (inaudible).

OFFICIAL: We could find that out for you.

MS FOOTE: Can I get a list of all the contracts and who has gotten them?

MS DUNDERDALE: Sure.

MS FOOTE: If you could table that for me, I would appreciate it.

MS DUNDERDALE: That is not a problem.

MR. CURTIS: Over what time period are you looking at there for that? Just in the last year or so.

MS FOOTE: In the last couple of years.

I would also like to know how many employees were in the department when you became the minister, compared to the number of employees there now.

MS DUNDERDALE: Sure.

MS FOOTE: If we could get that number tabled as well?

MS DUNDERDALE: Yes.

It would be about the same, I expect, or more.

MS FOOTE: Is there any discussion with the federal government, or anything happening around the Comprehensive Economic Development Agreement? Is that dead in the water, you are getting nowhere with it, or...?

MS DUNDERDALE: Well, it is dead in the water in terms of the response we are getting, but I continue to make it an issue with every federal minister and representative that I meet. It does not matter if it is directly a part of their portfolio or not. I raised the issue just last month in Boston with Joe McGuire, the Minister Responsible for ACOA. The Atlantic Premiers have made it an issue, but there really hasn't been any kind of response. There doesn't seem to be any desire at the moment.

MS FOOTE: Or appetite to go down that road.

MS DUNDERDALE: Or any appetite at all. It is just difficult for it.

MS FOOTE: Just back to the whole issue around - you mentioned how you are trying to look at community development in the Province. How do you see that being rolled out in terms of how communities in rural Newfoundland in particular - and I keep harping about rural Newfoundland because I think that is -

MS DUNDERDALE: Very important to all of us.

MS FOOTE: That is Newfoundland and Labrador. We talk about tourism, and tourists coming here, but I wager a bet that when people come to Newfoundland and Labrador they come to see rural Newfoundland and Labrador, as great as St. John's is or Corner Brook is.

What is the approach? How are communities supposed to get involved and get on the radar screen and be able to move ahead, I guess, or access funding, or find something happening within their communities to enable them to survive?

MS DUNDERDALE: Well, they have their Regional Economic Development Boards. They have their Chambers of Commerce. They have people who are engaged in business.

MS FOOTE: There aren't many rural communities that have Chambers of Commerce.

MS DUNDERDALE: Well, you know, in terms of a region, they certainly have their councils, their joint councils, and we are working very closely with all of them. There is intelligence on the ground that is better than any intelligence that might be found in terms of St. John's. There are a number of agencies and organizations involved in economic development, and our whole Regional Diversification Fund speaks to that. I mean, that is $5 million that is available for that kind of expansion and diversification that those organizations, when they are applying for money from Industry Canada or ACOA, that is where the dollars are. If we do not have federal-provincial agreements then we have to find another way to be able to access that federal money, and the diversification plan does that. I mean, we have seen it with broadband. We see it with all kinds of infrastructure that is happening in communities. We hope we will, and we will, see it in our marine strategy as we implement that strategy in terms of the innovation strategy, but also in terms of the Economic Initiatives Committee of Cabinet where there is a constant combing through of natural resources, fisheries, tourism, our own department and others, and combing out real opportunities that exist all around the Province. In agrifoods, for example, there are enormous opportunities, particularly on the West Coast and in Labrador and in the central part of the Province, enormous opportunities in agrifoods. What we are doing in aquaculture, like our loan guarantee program for working capital for aquaculture, it is certainly not all of the answer for Harbour Breton -

MS FOOTE: Speaking of aquaculture -

MS DUNDERDALE: It is a program that is mirrored very closely on the program that is in New Brunswick, and it has been very, very successful there. One of the huge impediments to aquaculture development in this Province has been access to working capital, so we have introduced this program which addresses that.

It is certainly not all of the answer for the Connaigre Peninsula but it is certainly going to be an important part of it.

MS FOOTE: Are they not on their last legs now? I understood that they were selling off -

MS DUNDERDALE: But there are new players who are interested and in discussions with government. Companies that have had very good success elsewhere in the country and internationally are very interested in our Province, so talks are ongoing with them, especially now that we have the working capital guarantee program in place.

There are big issues in aquaculture. The way that it was set up in terms of access to food, feed for the fish, it was destined to failure because of the exorbitant prices being charged by companies for feed. It was almost impossible for the companies that currently exist down there to survive without any kind of a funding program to assist them or help them in way. It would have been an incredible story, in fact, if any of them had succeeded. We are trying to address all of that and lay the foundation here that a company - and we hope local companies - can come back in there and invest and grow.

MS FOOTE: I am not sure if I am recalling it correctly, but, the Minister of Fisheries and Aquaculture, was the fund in his department or in ITRD?

MS DUNDERDALE: No, the fund is in our department but we work very closely with the Department of Fisheries and Aquaculture to develop -

MS FOOTE: I remember him standing in the House and talking about how they had helped to save aquaculture on the Connaigre Peninsula.

MS DUNDERDALE: The criteria developed were developed for existing companies as well as any new enterprises that might begin, and they were eligible to apply for funding under that program.

MS FOOTE: Apparently they did not qualify.

MS DUNDERDALE: They did not meet the criteria.

MS FOOTE: Why was that?

MS DUNDERDALE: Because it has be a viable company. It has to be able to show sustainability in the long term; because, in this program, you have to bring a bank with you. It is somewhat similar to the Fisheries Loan Guarantee Program. You have to have equity in the company, you have to have a long-term business plan and a sustainability plan before anybody is going to invest, any bank is going to invest or anyone is going to invest in you. Unfortunately, because of some of the circumstances that those companies had gotten into, particularly around feed with Shur-Gain, they were just too far gone.

MS FOOTE: That is it for me.

Thank you, Mr. Chairman.

CHAIR: Okay.

Are there any further questions from Committee members?

There being no further questions, I ask the Clerk now to call the subheads.

CLERK: Subheads 1.1.01. to 5.1.02. inclusive.

CHAIR: Shall subheads 1.1.01. to 5.1.02. carry?

All those in favour, ‘aye'.

OFFICIALS: Aye.

CHAIR: All those against, ‘nay'.

Carried.

On motion, subheads 1.1.01. through 5.1.02. carried.

CHAIR: Shall the total carry?

All those in favour, ‘aye'.

OFFICIALS: Aye.

CHAIR: All those against, ‘nay'.

Carried.

On motion, total carried.

CHAIR: Shall the Estimates for 2005-2006 for the Department of Innovation, Trade and Rural Development carry without amendment?

All those in favour, ‘aye'.

OFFICIALS: Aye.

CHAIR: All those against, ‘nay'.

Carried.

On motion, Department of Innovation, Trade and Rural Development, total heads, carried without amendment.

CHAIR: We have the minutes of our previous meeting, and I will deal with that a little bit later.

First of all, I would like to thank Minister Dunderdale and her officials from her department for providing us with so much information here this morning. I would also like to thank the members of the Committee as well as our Table officer, our Page and media person.

I remind the members that our next meeting is tomorrow morning at 9:00 o'clock, here in the Committee room, and we will be dealing with the Department of Business, and tomorrow evening, as well, in this room, Fisheries and Aquaculture.

MS FOOTE: Mr. Chair, I ask: Do you know if the Minister Responsible for Business is going to be here?

MR. JOYCE: Can you ensure that he is going to be here, so we can have a...?

CHAIR: I am just following the schedule, the printout that we had, but I will check on that and let you know.

MS FOOTE: I would like to know, please.

CHAIR: Okay.

MR. JOYCE: It is no good to have the meeting if (inaudible) .

CHAIR: Okay, I will check on that.

We have the minutes of the meeting that we held last night. I would like to ask for a motion to adopt these minutes.

Moved by Mr. O'Brien, seconded by Mr. Hunter, that the minutes of last night's meeting be adopted as circulated.

All those in favour, ‘aye'.

OFFICIALS: Aye.

CHAIR: All those against, ‘nay'.

Carried.

On motion, minutes adopted as circulated.

CHAIR: I guess that is about it.

Again, I would like to thank everyone.

A motion for adjournment? Moved by Ms Johnson.

This meeting now stands adjourned.

On motion, the Committee adjourned.