The Committee met at 6:00 p.m. in the House of Assembly.

CHAIR (Harding): I would like to welcome you all to the Estimates Committee meeting as we debate the Estimates for the Department of Fisheries and Aquaculture.

We will begin by having the Committee members introduce themselves by name and district.

MS JONES: Thank you, Mr. Chairman.

Yvonne Jones, the Member for the District of Cartwright-L'Anse au Clair.

MR. BAKER: Jim Baker, the Member for Labrador West.

MR. LODER: Terry Loder, the Member for the District of Bay of Islands.

MR. BUCKINGHAM: Ed Buckingham, the Member for the District of St. John's East.

MS PERRY: Tracey Perry, the Member for Fortune Bay-Cape La Hune.

CHAIR: We have three observers here, so for the record if you would like to identify yourselves.

MR. LOVELESS: Elvis Loveless, office of the Official Opposition.

MS WILL: Amanda Will, Executive Assistant, NDP office.

MR. MORGAN: Ivan Morgan, Researcher of the NDP caucus.

CHAIR: Thank you.

After I ask the Clerk to call the first subhead I will then ask the minister to speak up to fifteen minutes to first introduce the officials from his department and then give a brief overview of his Estimates for the year.

Following that, the next speaker will probably be Ms Jones. She will have up to fifteen minutes as well. Then I will stop and ask the other members if they want to ask a question, if they do not, then you will proceed until you are satisfied with the answers that you get.

Also, one other thing, this is being recorded by Hansard so it is important that if the minister asks one of his officials to respond, that they identify themselves each time before they speak.

So I will ask the Clerk now to call the first subhead.

CLERK: 1.1.01.

CHAIR: 1.1.01.

Does that carry?

Minister Hedderson.

MR. HEDDERSON: Mr. Chair, and committee members, I am pleased to present to this Committee the Budget Estimates of the Department of Fisheries and Aquaculture for the fiscal year 2009-2010.

Before proceeding, I would like to, beginning with my Deputy Minister, if they would introduce themselves and their title, please.

MR. O'REILLY: Alastair O'Rielly, Deputy Minister.

MR. MEANEY: Brian Meaney, Assistant Deputy Minister for Aquaculture.

MR. LEWIS: David Lewis, Assistant Deputy Minister for the Fisheries Branch.

MR. WARREN: Mike Warren, Executive Director, Marketing Development.

MR. DELANEY: Brian Delaney, ADM, Policy and Planning.

MS HYNES: Anita Hynes, Executive Assistant.

MS OATES: Lori Lee Oates, Director of Communications.

MR. HEDDERSON: Mr. Chair, this is my first appearance before this Committee, of course, as Minister of Fisheries and Aquaculture, and I am very pleased to report that our government continues to increase its commitment to and support of the fishing and aquaculture sectors.

Government's net expenditures on fisheries and aquaculture initiatives have more than doubled since 2006. This year, the gross expenditure allocation for the department will be approximately $33.8 million, as compared to the $15.6 million in 2006-2007, and a little over $10 million in 2005-2006.

Again, our net expenditures for the current fiscal year will approximate $27.2 million. Just to basically run through a couple of our areas. The fisheries, again this year our Fishery Industry Renewal Strategy is front and center as we continue to move through those initiatives that we have set aside that came to us from the consultations.

As many of you will remember, the renewal strategy began or was announced in April, 2007. Over the last number of years, and into this year, we will continue to move along with those particular initiatives, including the Fishing Industry Safety Council, our fisheries research and development, workforce adjustment measures, and others. We feel very strongly that renewal is where we need to be at this particular time and that strategy clearly gave us the path that we are continuing as we move through the next number of years.

Of course, there are other initiatives that you will see reflected in the lines, such as our cod recovery initiative, our trade development, coastal and oceans management, our seafood market development, and of course our fisheries infrastructure. All of these are important components and certainly as we went around introducing my officials, that each of them in their own way are responsible for any number of these as we continue to move forward. Perhaps throughout the course of the evening in our discussion we can get down a little bit more into the details.

Our sealing industry, as many of you have seen over the last number of days and months, and I suppose even years, our sealing industry seems to be always under tremendous pressure, and this time of year even more so, but we have continued to support our sealers, their industry and we continue to allocate funds in order to carry out the necessary aspects to ensure that that industry not only survives but continues to be the vital industry that it is.

When we go past the wild fisheries, of course aquaculture is one of the areas which were experiencing tremendous growth. There is great promise and opportunity for not only the Province in general but the residents, and especially in the rural regions of the Province. This Province would be the home to some of the last remaining aquaculture development sites, not only in this country but in North America in general. Of course, our Budget 2009-2010 contains several commitments to ensure that we effectively develop the sector to its full potential.

One of the major commitments that we have made is to our south coast aquaculture infrastructure and we are in a good position to move forward with that this year. As a matter of fact, this month we have been given the results of a consultation, consulting with regard to the infrastructure that is needed, the type of infrastructure. With the investments that we have made now, we should be able to get a good handle on that this year as we move forward.

As well, we were very pleased to get the cod demonstration farm project announced, back about a month ago. Again, we have committed over $2 million over the next four years to assist in the development of that demonstration farm, and of course we are in partnership with Cooke Aquaculture. They have announced an $8.5 million project to develop that demonstration farm in Hermitage Bay on the Province's South Coast. As well, we continue on with the other programs, the capital investment program, and other initiatives as well.

The aquatic veterinarian diagnostic facility, construction will begin on that this year. Of course, we continue with the waste water treatment facilities that are absolutely necessary to make sure that this treatment is on the plants that are anywhere near our particular sites on the South Coast.

Mr. Chair, and committee members, the department, under my leadership, is committed to a program of innovation and development to grow our fishing and aquaculture sectors. I look forward, with considerable optimism, to implementing our new and expanding initiatives to ensure that the fishing and aquaculture industries remain important contributors to our Province's social and economic well-being for generations to come.

Let's get on to the task at hand, which is to look at the lines and see where we go from there.

Thank you, Mr. Chair.

CHAIR: Thank you, Minister.

Ms Jones.

MS JONES: Thank you, Mr. Chairman.

I certainly thank the minister for that overview, and also to your officials for being here this evening.

I am going to start with the first heading, 1.1.01. the Minister's Office. I noticed, first of all, that there was $100,000 less spent last year in Salaries. Was that because of a vacancy in your office?

MR. HEDDERSON: Basically, for the summer months, the number of months from the time that Minister Rideout left until I took over, the minister's salary of course was not paid out. I think that pretty well covered those expenses.

MS JONES: Okay.

Also, you budgeted $58,000 under Transportation and Communications last year and you spent less than half of that. Is there any particular reason why you did not spend what you were budgeting, some travel that you were anticipating that did not happen?

MR. HEDDERSON: Okay, I just have to refer to my officials.

MR. O'RIELLY: I think it was mostly the same issue in terms of the vacancy, but also, perhaps, in light of that, or because of that, there was less participation in some of the other events that occurred on the marketing side and other missions during the course of the year.

As I recall, too, one of the major events carried out was at the end of the last fiscal year, on the Chilean trip and so on, so there may have been some expenditures in the previous year that had reflected the travel plans for that period.

MS JONES: Okay.

Under the same heading, 06, Purchased Services, you were budgeting for $11,000. You did not come anywhere near spending that. What were you originally planning to purchase, that you did not do afterwards?

MR. LEWIS: The Purchased Services in the minister's office covers some printing costs, meeting room space, and also the entertainment budget. Probably over half of it goes into the entertainment budget, so with the vacancy of the minister there was not much expenditure in that area.

MS JONES: Okay.

Under the next heading, 1.2.01 under Executive Support, again Purchased Services were less than half of what you budgeted. Can you tell me what you were planning to use it for, that you did not spend it on?

MR. LEWIS: That account covers advertising and printing costs. We just incurred less expense than we had budgeted in that in the past year.

MS JONES: Okay.

Under heading 1.2.02, Property, Furnishing and Equipment, you budgeted $1.4 million last year. You did not spend it. You only spent $300,000. First of all, can you explain to me what your intentions were there, that you did not carry forward with, and why you are budgeting the $6.6 million this year?

MR. HEDDERSON: That was around the St. Alban's facility, where we had hoped that we would have been further ahead; but, to get the details, again I am going to refer to my officials.

MR. MEANEY: The original budget estimate for getting the engineering work started, and potentially some of the site preparation work, in the last fiscal year was $600,000. Due to the design tendering process, and getting the tender completed, or the design of the building completed, we did not get to any of the ground clearing in the last fiscal year, so that just represents the design and engineering costs for developing the building.

MS JONES: Okay.

The $6.6 million that you have budgeted this year, is that what is required to complete the facility now?

MR. MEANEY: There are a number of initiatives under that dealing with aquaculture as well. There is approximately $3.4 million allocated for the construction of the diagnostic and administration facility in St. Alban's. There is about $500,000 of equipment that would be required in the diagnostic laboratory, as well, and there would be approximately $2 million there to commence work on the South Coast infrastructure.

MS JONES: What is the South Coast infrastructure? Could you explain to me what that is?

MR. MEANEY: That is the initiative that the minister referred to in his opening remarks regarding development of new wharves and opportunities for the aquaculture industry on the South Coast.

MS JONES: Okay.

MR. LEWIS: The additional $750,000 in that account will be for the Williams Harbour facility construction, and also for Nippers Harbour.

MS JONES: A good man, Dave Lewis. I was looking for that one. Thank you.

We will move now to Policy and Planning Services, heading 1.3.01. Again, under this section you spent a lot less on salaries than you had originally budgeted. Was there some vacancy in that part of the department?

MR. HEDDERSON: My understanding under that one was, that accounts for some of the positions that are vacant. Again, to get the details of that, I am going to refer to one of my officials to just give you the details on that.

MR. O'RIELLY: We had a number of vacancies throughout the department over the past year or so, and in the Planning Branch it maybe hit a little bit harder. We had some people who were seconded to other roles, or left for other employment, so there are vacancies there. There was promotion activity within the branch as well, and during that period it happened that we had a number of vacancies for most of the year, which account for all of the variants in the salary bill.

Some of these positions have been filled recently, and we are expecting to have that resolved very quickly for the others, so we are back on track with our budget expectations for the coming year.

MS JONES: Can you tell me what positions were vacant and which ones you have filled?

MR. O'RIELLY: The most significant one that was vacant for most of the year was the Director of Planning Services position, which was vacated by Mr. Delaney, who is now the ADM for Policy and Planning, and there were quite a number of others. Perhaps I will ask Brian to comment on the specific vacancies in the respective branches.

CHAIR: Mr. Delaney.

MR. DELANEY: We have had a number of people move on, some to the federal government. The Resource Policy Planning Supervisor, that position was vacant for a number of months. We had, actually, two incumbents in that position who moved to the federal government, the replacement and the initial incumbent. The Resource Policy Analyst also vacated the position. We had a Senior Economist, that the position was vacant for a good portion of the year. We have had the Industry Planning Supervisor position that was vacant for a portion of the year as well.

MR. HEDDERSON: Recruitment and retention is difficult because, obviously, my people are so well-skilled they are in high demand, and it is unfortunate that we are, obviously, losing some to the federal government. Not that they are not going to go and do great work, but recruiting these specialists is indeed difficult.

MS JONES: That is a good explanation, Minister. I thought there might have been other problems in the department that you could not keep staff over there or something.

Under Transportation and Communications, obviously your budget was down by half. Was that due to these vacancies in various positions throughout the department?

MR. HEDDERSON: I would think that was a big part of it, yes. I guess, less of all, was travel.

MS JONES: Under Purchased Services this year you are budgeting a lot less than you did last year. In fact, you cut the budget from $319,000 down to $170,500. Can you tell me what that money is usually used for, and why you anticipate using less this year?

MR. HEDDERSON: One of the renewal initiatives was the auction and, of course, we were not successful in – I guess in one way we were not successful, in another perhaps so - that we did carry it off, but in carrying it off it did not generate what we hoped it would generate. I think we need to go back to the drawing board on that and, as well, back to the industry, and say: You have been asking for the auctions. We gave you the auction. It did not work. Why did it not work? Do we want to go down that road again?

I think this year that will be the question that is posed, and if we cannot get any satisfaction from industry to go forward with it, I guess that might be where it is, but right now the analysis has been done.

Is there any other aspect of that, Alastair?

MR. O'RIELLY: Minister, that accounts, I think, for most of the variance - is the auction - and also some less expenditures in trade policy than are expected in the coming year in terms of some of the initiatives with analysis we have done associated with that in travel. The biggest factor has been the removal of the auction budget from the budget.

MS JONES: Are you sure you want to go back to that auction? There were a lot of casualties the last time around.

MR. HEDDERSON: Like I said, we would have to really look at that again because the consultation was there. It seems to work in other jurisdictions, but it is not working here.

MS JONES: I think you have to have a buy-in first.

MR. HEDDERSON: Yes.

MS JONES: Under property and furnishings you budgeted $6,400 but you spent $21,400. What was that spent on?

MR. HEDDERSON: Again, replacement of furniture. I think we had to outfit a boardroom, an extra boardroom. Was it another boardroom? It was. It was a smaller one for - was it the small one?

OFFICIAL: Yes.

MR. HEDDERSON: Yes, just as an alternative to the larger one.

MS JONES: Okay.

Under Grants and Subsidies you budgeted $446,000. Obviously, you only spent $30,000. What was the reason for that?

MR. HEDDERSON: Again, the auction and the trade policy; the two of them are tied in together. How specifically are they tied in together?

MR. O'RIELLY: Maybe Dave can elaborate, but it is roughly $400,000 for the auction that will not be required this year in the Grants and Subsidies budget, and in the trade policy it is $45,000 that will not be required.

MS JONES: You just told me that half of the $319,000 was allocated for this auction, and now you are telling me another $400,000. So this was going to cost well over $600,000 for a department to do this auction?

MR. LEWIS: The actual budget for the auction for last year was $500,000; it was $100,000 in Purchased Services and $400,000 in Grants and Subsidies.

MS JONES: What would you give a grant out for, as a part of this auction process?

MR. LEWIS: The concept was that the auction would have been administered by a non-government group. So it would not have been administered within house. It would have been possibly some organization put together by industry or someone else, but the notion was that it would be a non-government entity that would run the auction.

MR. O'RIELLY: One other point on that concept was that we would pay, really, the cost of running the auction for the first two or three years, as a department. Then, following that period of time, if it worked, and if there was take-up and if there was buy-in, as you said, from both sides of the industry, we would then expect the thing to be self-sustaining, self-reliant. That was the concept in terms of why advance the money for that period of time.

MS JONES: Of course, you only have $1,000 in there this time. Was that to mail out the letters to tell them it was cancelled, or what?

MR. HEDDERSON: What it is, I guess, is to clue up any analysis and that. Any money that is showing up there would be, I guess, not to promote it or anything but, like he said, just to clue up and to make sure that any loose ends are tied in.

MS JONES: Just out of curiosity, did you guys hire additional staff in the department to do this auction piece?

MR. O'RIELLY: No, we did not actually hire additional staff. We dedicated some of the staff to the task at hand, not on a 100 per cent basis but as a priority matter, to work with the industry.

There was an industry committee established, including representatives from the processing sector and from the harvesting sector, from the FFAW. Some of our staff worked with that committee to assist in the implementation or the evaluation of this concept in the earlier stages.

The lion's share of the work, the promotion of this project and the administration of it, was really with the Fish Harvesters' Resource Centre, which is an affiliated organization with the FFAW. Our role there was to assist as resource people, provide advice, and to assist in the administration of the budget for that initiative.

MS JONES: Okay. Thank you for that.

I am going to move on to section 1.3.02 under Sustainable Fisheries Resources and Oceans Policy.

I am just assuming – I am not asking about any of the salary increases this year, but they all look like the regular negotiated wage increase and step increases. Is that right?

MR. HEDDERSON: In this one, I think we added a position. You are looking under Salaries?

OFFICIAL: One position.

MR. HEDDERSON: One position extra, I think, on to it, besides the 4 per cent and the extra pay period.

MS JONES: What position is that?

MR. HEDDERSON: What was that, on the oceans?

MR. O'RIELLY: It is for a policy analyst in the Oceans section of sustainable development, and it is a temporary position.

CHAIR: Just stop for a second and check and see if there are any questions from the other members on the Committee.

Okay. Ms Jones.

MS JONES: Thank you.

I should let you know, though, Mr. Chairman, Ms Michael is not here because of family reasons and her staff that are here, if they have additional questions we will present them on her behalf after –

CHAIR: Yes, whenever they are ready, they will pass them to you and you can ask the questions. That is no problem.

MS JONES: Yes, okay.

Under 1.3.02.05. Professional Services, you budgeted $25,000, you only spent $500. What were you budgeting the money for and why did it not get used?

MR. HEDDERSON: That is the Oceans Policy budget and there are some reductions there. I will get one of my people to just run down through them.

MR. DELANEY: The change in Professional Services, we had anticipated maybe some consulting services would be necessary as we developed our ocean strategy. For the most part, for the work in 2008-2009 we conducted in-house and through a contractual employment individual.

MS JONES: This year you are only budgeting $5,000. So you are not anticipating –

MR. DELANEY: We are not anticipating any professional services to be purchased for this initiative.

MS JONES: Okay.

Under Purchased Services again, as well, you budgeted $70,500 and you only spent $15,000. What were the monies budgeted for but did not get used?

MR. DELANEY: It was in relation to developing the ocean strategy. A lot of the work was done in-house, in government, and we established a network called the Provincial Coastal and Oceans Network within government. So departments actually contributed more effort than we had originally anticipated.

MS JONES: Do you have your ocean strategy completed?

MR. DELANEY: We are working towards a document for this year.

MS JONES: So you expect you will have it done this year?

MR. DELANEY: That is what we are hoping.

MS JONES: You are still budgeting nearly $50,000 for Purchased Services. What do you anticipate using that for this year?

MR. DELANEY: For any speciality work that may be necessary in other areas, resource policy development and initiatives related to monitoring activity within the federal government, and access and allocations, et cetera.

MS JONES: Under that section as well, you have Grants and Subsidies of $500,000 last year. What did you use that money for?

MR. HEDDERSON: Basically, that is on recovery, and that is about $300,000. Dr. (inaudible) signs, about $150,000.

MS JONES: Is that what you are budgeting the monies for again this year?

MR. HEDDERSON: Yes, it is.

MS JONES: We will move on to section 1.4.01.under the Fishing Industry Renewal Strategy. Under this section, of course, there was $55,000 budgeted for Transportation and Communications. Were you planning on having some event, or something that you did not use the money last year because you only spent $16,000 of it?

MR. WARREN: These relate to just reductions in the pace of the Fishing Industry Renewal Strategy. Projects and programs were a little bit slower getting off the ground so less funds were required.

MS JONES: Okay.

Under Transportation and Communications, the $55,000 you budgeted, you spent $16,000 and you are saying that was for fishing renewal initiatives that you did not get out this year. Is that what you are –

MR. WARREN: Yes, just that we spent $16,000, we had budgeted $55,000. It is just a reduction associated with slower activity in getting projects off the ground.

MS JONES: Okay.

Can you tell me what those initiatives were?

MR. WARREN: For the Fishing Industry Renewal Strategy?

MS JONES: Yes.

MR. WARREN: Essentially, they are projects, or in elements related to the safety council, related to the Fisheries Technology New Opportunities program, related to, I guess, workforce adjustment activities. Those kinds of projects and elements of the strategy.

MS JONES: Okay.

This year you have allocated $55,000 again, so you are obviously planning on getting some of those programs done.

MR. WARREN: Yes.

MS JONES: Do you want to tell me specifically what they are? You just say fishery technology. What is it you are doing? Is there any kind of particular fishery, any new specific technology that you are testing? I do not know.

MR. WARREN: The Fisheries Technology New Opportunities Program, it is a significant element to the Fishing Industry Renewal Strategy. We have allocated $2 million per year for three years. In addition, we have added our base budget of $400,000 to that. So that is a significant activity related to developing a new technology, new markets, new products, energy efficiency, and these kinds of activities.

MR. LEWIS: Just by the way of clarification. Perhaps we should point out that not all funds (inaudible) strategy here under this heading. The Fisheries Technology New Opportunities falls under the fisheries development division, which you will probably get to now in a couple of minutes, just as the auction was under Planning Services.

In this particular element, this is for the overall administration of the program in terms of the salary dollars and so on. The two components that are built into this particular subhead here are the funds for the safety council and the funds for the Workforce Adjustment Program. The Workforce Adjustment Program is delivered between the Municipal Affairs, INTRD and Human Resources, Labour and Employment. So there are three departments that are involved in the delivery of the Workforce Adjustment Program. The funds for that are included in this element here.

MS JONES: Okay, so that would explain the Grants and Subsidies this year being down by nearly half a million dollars.

MR. LEWIS: The Grants and Subsidies was to cover the safety council and there was a delay in implementation on that. So that funding is again included in the $1,300,000 that is budgeted in 2009-2010.

In addition, the remainder of that funding is for the Workforce Adjustment. Where you are seeing in the projected revised, that $250,000 that was not spent last year, you will note that the amount is increased in 2009-2010. So that has been carried forward. There are initiatives that were approved but the funds were not all flowed in the past fiscal year, and they are carried into the current fiscal year.

MS JONES: How much money is for the Workforce Adjustment program? How much of that is broken out for that program?

MR. LEWIS: The normal yearly budget for Workforce Adjustment is $850,000 but this year there is a carry forward. So it is more like $1.2 million.

MS JONES: What initiatives are you doing now, Minister, under the Workforce Adjustment program?

MR. O'RIELLY: As Mr. Lewis mentioned, these are initiatives that are carried out jointly; ourselves, HRLE and Municipal Affairs. Typically, the eligibility is for in a situation where a plant is permanently closed. In the event of a permanent closure, and that has been determined and confirmed through a process of approval through a ministerial committee, each department then responds within its own area of expertise and competency to provide enhanced levels of support to the community.

We have had a couple of examples, a couple of experiences in the community of Trinity for instance and Port aux Basques, where there were permanent plant closures. In each case there was an enhanced employment program offered for the workforce which offered a higher wage rate than would be normally provided for instance in the context of community development initiatives which occur every year in plants where there has been a shortfall in employment. So there is an enhanced employment program. The more significant and valuable part appears to have been the counselling program that has been offered to assist workers' transition from the work they were doing to look at other opportunities and that involves a full suite of measures in terms of employment counselling and assistance and support to people to engage in training opportunities or alternative employment pursuits.

MS JONES: What was the last area of the Province that you did a program in?

MR. O'RIELLY: I think the Port aux Basques project is the most recent. That was the last project.

MS JONES: Port aux Basques.

MR. O'RIELLY: Yes.

MS JONES: What plant closed in Port aux Basques?

MR. O'RIELLY: The Barry plant, Barry Group Limited had a permanent closure of the plant. I think that was two years ago.

MS JONES: Are you anticipating any plant closures this year?

MR. O'RIELLY: It is not an easy thing to predict, so we are hard pressed to say with confidence what may happen in any given year. Those that have occurred, we did not have a whole lot of advance warning and notification of, nor could they have been predicted but at this point in time there is no knowledge of any intent, or we have not been given any information from companies of an intent to proceed with any kind of a permanent closure.

MS JONES: Okay.

Again, under that section, I guess that explains why you did not use the money that you budgeted for Professional Services and Purchased Services and so on. Would that all have been connected to Workforce Adjustment program?

OFFICIAL: (Inaudible).

MS JONES: Under Regional Services, Administration and Support, section 2.1.01. Under Professional Services you budgeted $10,000; you did not spend any of it. Was there something specific you were going to look at doing last year in the department that did not get done?

MR. LEWIS: Well, $10,000 is budgeted annually for engineering services and other professional services related to fisheries facilities, the facilities that are still owned by the department. The demand for that is variable from year to year, depending on whether facilities are –if there is a problem that needs to be looked at or if a facility is being divested, and in the past year there was no charge in that particular account.

MS JONES: You were lucky. You had a good year.

Under Grants and Subsidies, what is the $300,000 there used for?

MR. HEDDERSON: The Grants and Subsidies? That is our nice special assistant grants.

MS JONES: You have good take up on that program by the looks of it.

MR. HEDDERSON: I think it is a good 100 per cent. It is one of the – obviously, it is that type of a program that fits needs that are not addressed in any other way. They are just small grants allowing communities to avail of those types of funds to maintain a site or to do small repairs to it. Again, the take up is good and the projects usually are very well-suited to community development.

MS JONES: Under section 2.2.01. Seafood Marketing and Support Services; again, under Professional Services you overspent nearly $70,000 what you budgeted last year. Do you want to tell me what that was for?

MR. HEDDERSON: That is the trade show costs, I believe, and market intelligence. Again, there is a drop. So I guess we did not do as much last year as we –

MR. O'RIELLY: Well, most of this was for increased market intelligence. In this program we have a mandate, a responsibility to provide marketing analysis work for the fishing industry and to support the collective bargaining process. This year there was a significant increase in the amount of work that was carried out during the course of the year, more consultancy work in Europe and more frequent support from traditional consultants such as seafood.com to support the process that was carried out over the past year. That accounts for the increase.

MS JONES: Who do you usually get to do that work for you?

MR. O'RIELLY: Seafood.com has been the one that has been involved, from Boston, for the past twelve years, I believe, and John Sackton is the analyst who does most of the work on shrimp and on crab during the course of the year, but in the last year in particular we used more consultants out of Europe to look at the shrimp market in particular because the shrimp market is much more significant in Europe for us. It used to be that it was almost a fifty-fifty split. It oscillated back and forth between the United States and Europe for a number of years but in the past few years, because of market dynamics, exchange rates and so on, almost all of our shrimp, 90 per cent of it, is into the European market, so we have developed relationships with several consultants throughout Europe to provide us with more in-depth analysis and more accurate portrayals of what the market is in that sector.

MS JONES: Under Grants and Subsidies there, as well, you budgeted $1.2 million and you only spent $200,000.

MR. HEDDERSON: That is the market council.

MS JONES: Okay. That was the one you took the vote on, was it?

MR. HEDDERSON: Yes, it was.

MS JONES: The processors voted it down.

MR. HEDDERSON: Yes.

MS JONES: What are you going to do with that now?

MR. HEDDERSON: Well, that proposal is off the table now. Obviously, we did the consultation, and the direction from Sandy Roche, who was our consultant at that time, indicated that it had to be buy-in, henceforth the vote, but the industry saw fit not to accept that. So I guess it is back to the industry and we will have to see where they want to go; because, obviously, with this proposal off, we need to seek direction again. You cannot do it overnight, so during the course of the upcoming year we are going to try to initiate something to get this back on track and make sure that when we go forward the next time it will be successful.

MS JONES: What is the piece about the certification of processing companies?

MR. HEDDERSON: That is the MSC certification?

MS JONES: Yes.

MR. HEDDERSON: That is, I guess, the buzzword these days because people – consumers, I should say – want to know that the resource or the fish that they are eating is coming from a stock that has been fished properly, low carbon footprint, that it is sustainable, that it is not a declining stock. Therefore all the different species, for the most part, there is certification. Right now there is certification ongoing for the shrimp and other species as well.

MS JONES: Were there some companies in the Province that did not get certified, who are now having some difficulty with marketing their product this year, maybe?

MR. HEDDERSON: Yes, because what has happened, of course, as you are probably aware, there are two processing organizations plus independents, and one of the processing - ASP - were able to get the certification. Then, of course, the responsibility lies upon anyone – I guess, them – to further pass that along to others that may be looking for it.

In the course of that process, things seem to have slowed down and there are indeed some concerns about them not being able to get together with some sort of an agreement to move forward so that the certification can be extended to others who are looking for it right now, but that process is ongoing.

Perhaps, Alastair, you would like to just very quickly bring us up to scratch on where that is right now.

MR. O'RIELLY: As the minister noted, the process is ongoing and the companies and the associations are working to try and resolve their differences and make effective use of that label in the coming year, which is something that holds significant potential. In a difficult market as we face in shrimp this year in Europe, largely because of exchange rate effects, access to that label is expected to be very significant in terms of accessing the upper echelon of the marketplace, the more discerning retailers and food service companies that are demanding the use of that label, or access to that label, to demonstrate sustainability.

We are still hopeful that there will be a resolution of those differences in the next short while and that we will get good use of it in the coming year.

MS JONES: When the department put the money in for some of these processors to go out and meet those standards, was the offer made to everyone across the board, all the processors in the Province, or was it just one select group?

MR. HEDDERSON: Any group that comes forward that is looking to do certification, whether it is a company or whatever, we do have money set aside to assist them in getting that certification, and are obviously hopeful that if there is a need for them to share that with others that they would indeed share it, but again we did not put any restrictions on it to that effect.

MS JONES: Is this mostly affecting shrimp processors or –

MR. HEDDERSON: There are others. Alastair, you can pick it up there.

MS JONES: - shrimp and crab? How does that work?

MR. O'RIELLY: The certification that we now have is only for shrimp, but there are a couple of others that are being proposed and that people are working towards for the coming year. They are not industry-wide, as shrimp is, but are more specific to individual firms and circumstances.

Just to comment on the point you made about the expenditures, this fishery was certified, the inshore shrimp sector, so there was an expectation that everybody who participated in that sector would have access to the label. As the minister pointed out, there are still some differences among the industry on that.

There was also the certification authority or the Marine Stewardship Council itself; their governance guidelines require that everybody has fair access to the use of the label. On that basis, we had every expectation it would be industry wide and we are still ensuring, or attempting to ensure, that is the case.

MS JONES: So you are pretty confident it is going to get sorted out, are you?

MR. O'RIELLY: Reasonably confident.

MS JONES: I hope you are right.

Under Licensing and Quality Assurance, again under Transportation and Communications you budgeted $130,000 and you spent $30,000. It must be the shortage of staff over there and no one can get out of the office, is it?

MR. HEDDERSON: I think we moved a bit of money there, and I am going to get the explanation for it from Alastair or, I guess, Dave.

MR. LEWIS: There are a couple of things there. One of the initiatives funded through that particular subhead is the operations of the Fish Processing Licensing Board, and the amount of funding required for the board varies, depending on the volume of applications and the demand for board activity, but we found in the past couple of years, actually, that the cost to operate the board is significantly less than had previously been anticipated so, in fact, in the coming year we have taken $70,000 out of that account. If you look at Transportation and Communications, you will see that there is a $50,000 reduction, and similarly $20,000 in Supplies.

That $70,000 has been taken and moved over into Regional Services because we have found on the other side an increased cost for office lease for our facilities, our offices in rural areas, and also some of our operating costs in the regions, particularly gas prices, for example, for the fleet of vehicles that we use for inspections programs, is up, so we have actually taken $70,000 out of this area and moved it over into Regional Services.

MS JONES: Okay.

The fishing licence renewal board, you said the money for them is under this section?

MR. LEWIS: The Fish Processing Licensing Board is funded here.

MS JONES: That is the same. That is the crowd that looks at the licences, and whether they are going to move them, shift them, cancel them –

MR. LEWIS: Well, we have an open and transparent process now for fish processing licensing. If anybody wants to apply for a licence or transfer a licence or change ownership on a licence, they have to advertise it publicly and then they have to submit an application to this licensing board. The board reviews the application. It will have representations made by various interests for and against. It may have appearance by proponents. Based on all of that input the board will make a recommendation to the minister, and then the minister will make a final decision on the licence. That came out of the Dunne report back in 2004.

MS JONES: Who sits on that board?

MR. LEWIS: The membership of the board was: Richard Cashin was the chair - his term is up now, actually - Bern Bromley, Ida Powell from Charlottetown, Dave Bonnell from the Marine Institute, and Shirley Shea.

MS JONES: Are all their terms up, or just the chair?

MR. HEDDERSON: Bern's and (inaudible). We are in the process now of finding replacements for those two. One is the chair and the other, of course, is a member. Bern happened to be the vice-chair, but the chair is appointed; the vice-chair is selected from the committee, once they meet.

MS JONES: The licences that were agreed to be transferred to La Scie and Roddickton, where is that?

MR. HEDDERSON: Basically, the deed is done and I think there is a date as to when it has to be carried out.

Alastair, can you just provide us with those details?

MR. O'RIELLY: In the case of the transfer from the licence, the shrimp licence from St. Joseph's to La Scie, that is not anticipated to occur this year. The company has two years in which to execute that transfer, and the understanding and expectation is that they will proceed with it in the next fishing season in 2010.

In the case of the other transfer that you referred to, it was not Roddickton, actually; it is Conche.

MS JONES: Oh, Conche, that is right. I am sorry.

MR. O'RIELLY: That transfer has already been executed and the Conche plant will be participating in the crab processing activity this year.

MS JONES: Who owns that plant in Conche?

MR. O'RIELLY: I think it is Derek Green, E.J. Green. I think he calls it Northern Processing, Dave?

MR. LEWIS: I am not sure of the actual name.

MR. O'RIELLY: (Inaudible). It is his company and his operation, and he has been operating in Conche for quite a long period of time.

MS JONES: He is the mussel man, is he? Is he the mussel man?

MR. O'RIELLY: He has –

MS JONES: No, the urchin, the sea urchin; he started that too, didn't he?

MR. O'RIELLY: Derek has been very instrumental in developing the sea urchin business, and he played a real significant role in that.

It is interesting that you mention the mussel man, because he is in a joint venture with Terry Mills, who is one of the more significant, more successful, long-term producers of mussels in the Province, and they have a joint venture business between them in mussel processing.

MS JONES: Okay.

MR. LEWIS: Just to clarify, the company name is Northern Seafoods Limited.

MS JONES: Northern Seafoods.

Is this the only crab plant that they will have, the one in Conche?

MR. O'RIELLY: No, the plant at Winterton also processes crab.

MS JONES: It processes crab. Okay.

Were there any licences revoked this year by the board?

MR. O'RIELLY: No, the board would not normally revoke licences.

I would not be asked, of course, but what happens in the normal course of events, if a licence of a species that is authorized is not processed for two consecutive years it is automatically removed from the list of authorized species associated with the licence, and in the first couple of years there was a dramatic reduction in the number of species authorizations. Dave Lewis can comment and provide more detail. My recollection was that we went from 2,400 to 400 species authorizations, but in the last year or so there have been a few more come off the listing because they are not being actively used.

Dave, can you comment on what happened this year?

MR. LEWIS: It would be off the top of my head, I could not give you an exact number, but it would probably be in the order of twenty or so species authorizations that were removed from various companies this year. Companies have two years in which to have the license active. They have to produce a minimum amount in one of the past two calendar years. If they do not meet that minimum then the species is removed from the license.

MS JONES: Okay.

Were there any new licenses or new species added to licenses?

MR. LEWIS: Any new licenses or species added to licenses, I could not tell you off the top, but there might have been a couple. It would all be on the department's web site. There is a page there for the Fish Processing Licensing Board, and all of the applications that have gone to the board, their recommendations and ministers decisions, are posted there from 2005 onwards. That is up-to-date.

MS JONES: Thank you.

I am going to move on to Compliance and Enforcement, 2.2.03; again, a situation where you budgeted over $83,500 in Transportation and Communications and you spent only $50,000.

MR. LEWIS: You will note also that there was a significant reduction in the amount actually spent on salaries. We had three vacancies, actually, during a portion of the past year, an auditor, an analyst, and a secretarial position. The auditors, in particular, spend a fair bit of time in travel status, going around the Province and auditing the production reports of various plants. That would have accounted for most of the reduction in the travel costs.

MS JONES: Okay.

Under Fisheries Innovation and Development, 2.2.04, again under Salaries: Did you have some vacancies there last year?

MR. LEWIS: Yes, we did. We had some vacancies there as we started up the Fishing Industry Renewal Strategy in the Fisheries Technology New Opportunities Program. A fisheries analyst, a development analyst, as well as a planning supervisor position were vacant for awhile. This was a new division that was created as part of the Fishing Industry Renewal Strategy where we separated the marketing side from the fisheries development side. We have two divisions now that we had previously brought together into one.

MS JONES: Have those positions now been filled?

MR. WARREN: Yes, they have.

Just for clarification: We filled a position, and through other vacancies we did promote a person who was in one of the officer positions to the planning supervisory position and now we are filling that position.

MS JONES: That is what you have to love about the public service, isn't it?

Again, under Transportation and Communications, you only spent half of what you budgeted because of the vacancies. Is that the reason for that?

MR. WARREN: Yes, that was partly because of the vacancies, but also partly because of the start up of the Fisheries Technology and New Opportunities Program.

MS JONES: How many people work in this section, this division?

MR. WARREN: I am counting in my head here. I think there are eight. I will have to verify that. Just give me a chance to count through the bodies.

MS JONES: That would be eight people coming out of the $529,000 allocation for the Estimates this year?

MR. WARREN: Yes, that is right.

MS JONES: You are doing better than I am in my office.

Under Supplies you budgeted $30,000 and you spent $10,000. Any particular reason why you did not spend what you estimated?

MR. WARREN: Once again, these relate to the start up of the fisheries technology program. We were slow getting the project started for various reasons. We expect we will be fully on track this fiscal year.

MS JONES: Under Professional Services you spent $35,000. Do you want to tell me what that was for? You did not budget for it. There must have been something that came up throughout the year.

MR. WARREN: Professional Services?

MS JONES: Under 2.2.04., subhead 05 there was no money budgeted but you spent $35,000.

MR. WARREN: I am not sure. I will have to check on that to confirm.

MS JONES: Okay.

Also under that same heading, 06, Purchased Services, you budgeted $473,600 but you only spent $103,000.

MR. WARREN: Once again that relates to the Fisheries Technology and New Opportunities Program. That is the main funding program within that division. We had expected to get projects rolled out quicker than we did. For various reasons companies were not ready, those kinds of reasons, so we were a bit slower.

MS JONES: And, of course, you budgeted the same amount this year. The $473,600, can you give me the breakdown of what you are going to spend that money on?

MR. WARREN: I am sorry, I missed that.

MS JONES: The $473,600 that you budgeted this year, can you give me the breakdown of what you are going to spend that money on?

MR. WARREN: There are lots of projects. These are projects related to development activities in plants and on vessels, energy conservation, new processing techniques, these kinds of things.

MS JONES: How do people access this money? Do they submit an application or something?

MR. WARREN: They do indeed. Some projects we identify internally that we work with industry on, but for the most part they are proposal-based projects, from harvesters, processors, marketing companies, that sort of thing.

MS JONES: Do you provide 100 per cent funding, or is it cost-shared?

MR. WARREN: It is cost-shared, but we also have the option, through non-profit groups, to provide 100 per cent funding.

MS JONES: Okay. But to the private sector it is cost-shared, is it?

MR. WARREN: Yes.

MS JONES: What is the cost-shared ratio?

MR. WARREN: The cost-shared ratio in terms of projects, 60-40. It varies with projects, actually. We look at projects and we look at the merits of the projects and the costs involved and we work with companies to assess our contribution. We also work with the university, CCFI, and organizations representing harvesters and representing processors as well.

MR. HEDDERSON: (Inaudible) this is one of our more successful programs, as a start-up program under fisheries renewal. Just to clarify, we have had close to about 120 applications. Of those, I think, project costs of about $15 million, half of them went to processing, 40 per cent to harvesting, and 10 per cent to marketing. Those are, obviously, the three areas. There are something like thirteen rejections, and I think there are about twenty-four in progress, and I think twenty files are closed. I am just going down through. I do not know if you would need any more information on it, but what I want to get across is that this is one of the areas that we hope this year, will continue, because it is one of the areas that we need so much, the innovation.

Like I said, if you need to have some sense with regard to the types, I think we can supply that to you as well.

MS JONES: Just so I am clear: The grants and subsidies, then, really is what you are using for these programs, right?

MR. HEDDERSON: Yes..

MS JONES: The Purchased Services amount was what I was asking the question about, so I am somewhat confused now.

MR. HEDDERSON: Yes. I will put it make to Mike again.

MR. WARREN: We provide Grants and Subsidies, but also we cover it under Professional Services as well, for some of our in-house projects.

MS JONES: Okay.

That is a good take-up on that program. That is a lot of applications.

MR. HEDDERSON: Not only that, but all the aspects, the harvesting sector, the FFAW, the industry, we do a lot of work on those through the CCFI. That is one worrisome part of this, of course, that we appear to be losing that group. That is going to be problematic this year, because they did allow us to do fisheries directed research and development, and without them I think there is going to be a big gap.

MS JONES: Thank you. I am going to move on to aquaculture.

I know Mr. Meaney must be excited with all the money he has to spend these days.

First of all, under Salaries, last year you spent less $500,000 of what you had budgeted. Do you want to tell me where the vacancies were last year in the department?

MR. MEANEY: There were a number of positions that were not filled during the last fiscal year. Again, as you heard earlier tonight, and we have had a number of moving positions. We also created four positions associated with the new fish health facility on the South Coast, and they will be staffed in the current fiscal year. We had hoped to have them staffed earlier, but the process going through to get the positions approved and classified took some time. Those positions will now be filled in this year, and the estimate for the current fiscal year includes the salary increases negotiated as well.

MS JONES: Okay.

Do you want to give me a list of what the vacancies were, because there was $500,000 in salary not paid out. That is a lot of money.

MR. MEANEY: There were a total of eight positions. Again, as has been mentioned earlier tonight, there has been some movement within the branch of people leaving and then coming back. We had a senior policy analyst that was vacant. We had two development officers that were vacant, one veterinarian, two laboratory technologists, a biosecurity auditor, and an aquaculturist. I think those are the total positions.

MS JONES: Have they all been filled now?

MR. MEANEY: No, five positions are in the process of being staffed right now. They are going through advertisement. They are on their way to that process.

MS JONES: Under Supplies you obviously budgeted a lot of money last year, $630,000 or a little more. You only spent $148,000. What were you budgeting for that you did not get done?

MR. MEANEY: These were supplies directly associated with the development of the new facility in St. Alban's, and particularly focused on equipping and supplies for that facility. With the facility not being constructed in the last fiscal year, then those supplies were deferred and being carried forward into the current fiscal year.

In addition to that, we contract a lot of our fish health work to laboratories such as the Atlantic Veterinary College in Prince Edward Island, and the volume of that work can vary from year to year. We have an allocation there that would cover what we potentially think might be the maximum amount of diagnostic tests we would require. In the past fiscal year, that number was significantly down, so that would also be reflected in that number as well.

MS JONES: Okay.

That was all under just the Supplies section, was it?

MR. MEANEY: Yes, within those three subheads, Supplies, Professional Services, and Purchased Services. That is a large component of our fish health program and those costs would vary from year to year on a regular basis depending on the amount diagnostic work that needs to be done.

MS JONES: Yes, because I noticed your Professional Services was up last year. You spent more than you budgeted.

Also, under Purchased Services, your budget was more than doubled what you had allocated. Do you want to tell me what you purchased under Purchased Services?

MR. MEANEY: Under Purchased Services, that would relate to one-time furniture costs with our facility in St. Alban's, some new staff there as well that we have hired. We have moved a couple of positions out of Grand Falls down to the South Coast and added one new position in the last year. Some of that cost is associated with that down there as well.

MS JONES: All of the $525,000, over $500,000 in furnishing that place, those offices?

MR. MEANEY: No, the bulk of that would be services purchased from the Atlantic Veterinary College, diagnostic testing.

MS JONES: Okay, that is what I wanted to know.

The furniture, I guess, came out of the furnishings and property budget, did it?

MR. MEANEY: Yes.

MS JONES: Okay.

The $525,000, which is what I am asking about, that would have been –

MR. MEANEY: Diagnostic testing. We have had a significant increase in production, as you are well aware, in terms of the industry. So that would increase the amount of diagnostic tests that our veterinarians would do on a regular basis.

MS JONES: Under the Grants and Subsidies there, you budgeted $2.6 million and you spent $1.5 million. What did you spend the $1.5 million on and why didn't you spend the other $1 million?

MR. MEANEY: In the last year we spent $1 million on the announcement of the cod demonstration farm that the minister alluded to in his opening comments.

Under the Waste Water Treatment Program we conducted $180,000 worth of work. Our sentential salmon research project which is a jointly funded five-year project with other Atlantic provinces, and the Atlantic Veterinary College was $72,000. Also, we have our regular aquaculture technology program, is $330,000. So that is what would have been the expenditures last year.

The reduction there from our Budget really relates to the Waste Water Treatment Program. We concluded one of those operations out of the three down there last year. The others are tied up. The engineering work is done. Some of the equipment work has been completed. However, there is an issue with extension of one of the facilities and that is subject to the acquisition of some private property in the area. That is going through the process of acquisition right now and that delayed those expenditures in the current fiscal year but will happen in the coming one.

MS JONES: How many facilities are you doing this Waste Water Treatment Program in?

MR. MEANEY: There were three facilities in total. There was Harbour Breton, Gaultois and Hermitage. As well, a smaller operation in Harbour Breton that we have added into this coming fiscal year; a smaller fish processing operation.

There are a total of five processing operations down there. The one in St. Alban's has had a waste treatment facility there for a number of years. The one in Harbour Breton is completed and the other three are in progress and will be completed in the coming fiscal year.

MS JONES: Brian, how many aquaculture projects are around the Province now? The five you just mentioned, in five of those areas. Do you want to tell me or give me a list, or table a list or something for me?

MR. MEANEY: Yes, we can provide you with a listing of those. Right now, the total number of licenses is 140 in the Province.

MS JONES: Okay. How many of them are active, or are they all active?

MR. MEANEY: These would all be active. So, there are fifty-three that are dealing with the salmonid sector, either salmon or steelhead. There would be fifty-nine shellfish, which include mussels, and there are a couple of small oysters and scallop operations still ongoing.

There are seventeen Atlantic cod; four of those are related to the cod demonstration farm. We do have a couple of individuals who are still looking at the cod on-growing project that the department has been involved in for another year.

Then we have another eleven miscellaneous licenses. For example, you mentioned Green Seafoods. They operate a couple of small sites with sea urchins, as an example. There is an eel operation out on the West Coast and a few others like that.

MS JONES: Okay, and is there still a lot of interest? I mean we hear about all of the bigger aquaculture projects, of course, but in terms of the small family-based aquaculture industry projects, is there still much interest in that around the Province?

MR. MEANEY: The numbers remain fairly stable. A lot of the mussel operations are in the process of trying to expand their existing operations. Some of them have done extremely well in terms of huge expansion and others are expanding on a more modest basis. Really, we are dealing with a core group, if you like, both in the salmonid sector and in the mussel sector that maintain and are expanding their markets, and as their market expands they expand the farming operations.

MS JONES: Okay.

Under the next section, of course, the Loans, Advances and Investments, you budgeted $4 million; you only used $1 million. Why was that?

MR. MEANEY: Our estimate to the budget last year included completion of the agreement we had with Cooke Aquaculture, which would include $2.75 million for their hatchery. Unfortunately, they never got all their engineering work and water analysis work completed in this past year.

For construction of the hatchery, the agreement indicates that they would have to expend the money before we would contribute our portion. So, that hatchery is anticipated to be constructed this year, and that $2.75 million will be flowed in the coming fiscal year.

There was $1 million for Gray Aquaculture, which was announced in June. That was an equity investment for a new farming operation. The remainder is an estimate that was there in terms of potential new applicants that may be interested in applying to the program. We cannot anticipate or know every single process that may come forward, but we do put in a figure that would anticipate some potential growth in the program.

MS JONES: Gray Aquaculture, what is it they are doing?

MR. MEANEY: That is a salmon farming operation. They are an established family company out of New Brunswick, and they have moved into four sites on the Connaigre Peninsula. There was an announcement in June regarding their participation in the capital equity program and the loan guarantee program. They are based out of Conne River.

MS JONES: Oh, okay.

The hatchery that Cooke Aquaculture is putting in, I forget, where are they putting that to?

MR. MEANEY: This was part of the process they were going through, looking at the various sites along the South Coast and getting the engineering work, and they are getting very near completion there to determine the exact site.

MS JONES: Oh, okay, so they have not decided yet.

MR. MEANEY: Yes, one of the big issues for hatchery development, obviously, is the volume and the quality of water. That is an extensive amount of work of drilling wells, getting it tested and seeing if you have enough. So they have been going through that process.

MS JONES: Okay.

The $3.8 million that you are getting there from the federal government, is that under a specific program or something?

MR. MEANEY: Community development.

MS JONES: Oh, okay. I knew that, I got that list today, but I did not have a chance to look at it yet.

MR. MEANEY: Okay, yes.

No, we are there.

MS JONES: That is the trust right, the Community Development Trust?

MR. MEANEY: Yes.

MS JONES: Yes. Okay.

Well, I have a couple of general questions. A lot of them, I covered them as I went through, but –

MR. HEDDERSON: We just want to go back to a point on that $35,000 that you asked about –

MS JONES: Yes.

MR. HEDDERSON: – that was just standing alone there. Professional Services, I believe it was?

MR. WARREN: Yes, I confirmed that. I wanted to confirm that before I responded, just for clarification.

We hired a professional photographer to update our activities, and our photography on fishing and aquaculture activities throughout the Province so we can use in our various marketing related activities.

MS JONES: Okay.

MR. HEDDERSON: The other thing would be the number of jobs; I think it is nine instead of eight. I do not know, Mike, if you just want to run down quickly through the positions?

MR. WARREN: In Innovation and Development, there are six positions. There is a director, there is the senior engineer, the marine architect, and the resource planning supervisor. We also have a temporary position under the Fisheries Renewal Strategy in that particular program.

On the Seafood Marketing and Support Services, we have nine positions. There is the director of seafood marketing. A senior engineer looks after the support services side. We have a fisheries resource planning supervisor, which is a marketing position. We have a market development officer. We have a policy, planning and research analyst, and we have a refrigeration specialist, that is a seasonal position, and of course we have a Clerk Typist III position.

MS JONES: So out of the $529,000, how many people is it?

MR. WARREN: Nine.

MS JONES: Nine. Okay.

I have a couple of questions around the European Union piece. I know that the Province did a lot of talking about this recently in the media, and I guess I am wondering what the strategy is for the department.

There have been some pretty strong statements made about our taking this responsibility upon ourselves, not necessarily sharing the perspective of the federal government, not being comfortable with having them represent our views at the European Union. So I guess I want to know what the strategy is for the department and for the government. There are going to be decisions made come May. So I would like to know what the step-by-step plan is for you guys and how you are going to deal with this.

MR. HEDDERSON: It is a broad thing because obviously we are involved with the seal issue with the EU. As well, with regard to custodial management of our resources, with regard to the shrimp tariffs - not only shrimp tariffs, let me qualify that, any species that goes in are under tariffs. There is a third one.

OFFICIAL: The three issues are the tariff issues, the seals, and custodial management.

MR. HEDDERSON: Okay, those are the three that we are most involved in. Obviously, our position has been that under custodial management, I think it is obvious that we want Canada to push for the custodial management.

With the tariffs going into the EU, we have done some work on the shrimp and got some relief, but every species that goes in – and of course the seal, with regard to putting forward the strategy as to what we should be doing to ensure that our seal industry is front and center in any negotiations.

The Province has taken the position that we want to be absolutely sure that our positions are presented. The Premier has made a statement that he feels very confident that our positions have not been put forth as forceful as they should, and therefore the position that this government has taken with regard to the EU trade talks that are coming up.

With regard to the sealing strategy, which is more in our court, we feel very strongly by the very fact that the federal government has not shared their strategy with us. We have been on the Ambassador's committee; we have been in contact with the federal Department of Fisheries and Oceans. All through, in the last couple of years, we have been asking for them to put their strategy on the table so that we know where they are going, what is their plan, and so on and so forth, but they have never shared that with us.

We are in the eleventh hour right now with regard to that, and we feel very confident that we have to take a more aggressive role in making sure that our position is well known as the parliamentarians in Europe make their decision, as it goes through that parliamentary process, and to get us into the mix.

We have done different things but, of late, the Premier has written to all of the ambassadors – I think twenty-seven of them - and we as a department are following up on that. We have already spent two days in Ottawa dealing with the ambassadors and have found that there are ways, we believe, that we can represent our sealing industry to this European parliamentary process. Our goal is to somehow find ways in which we can perhaps delay it, that we can lobby so that it is not a complete ban, which it seems to be heading for right now, and to again perhaps change our tactics a little bit in trying to put forth a position that is more in keeping with the European way of doing things.

That is where we are right now, and we are very, very hopeful that our efforts will bear some fruit.

MS JONES: I guess what I was looking for is in terms of what your plan is for the next four to five weeks. It is going to be pretty critical, and I do not understand the international trade laws enough to know. Is there a way through the courts that we can have the European Union decision delayed or deferred to a later date?

I am interested in knowing if the provincial government has lobbyists today on the ground across Europe, lobbying these parliamentarians. I mean, if we are taking this issue on, we have to do more than send letters out to ambassadors in Canada for these nations.

I guess what I am looking for is, to match the strong position that the government has taken publicly, where is the action behind it?

MR. HEDDERSON: The action behind it, as I pointed out, is twenty-seven ambassadors who we can meet with, that we can strongly put our position forward, and by gathering the intelligence from them, obviously, it will help us as we go forward.

As for having a network of people in Europe, obviously you know the impossibility of that at this late a time, because we had depended upon our federal government to have that done, and where they brought us is literally to a situation where it appears there is no hope.

We were assured as we were moving along that their strategy was going to take us to a place where there would be derogation, that we would have an opportunity for our hunt to continue on, and we find over the last number of weeks that every committee that has come forward has set a complete ban. So we need to, now, and obviously we are not going to get everyone in Europe to agree, but we have to be strategic in going to our allies. We have found allies, basically in our Nordic countries who participate in seal hunts, who do understand the resources of the sea, who have indicated to us that there are ways in which we can make our presence known by again presenting not necessarily arguments that we have been presenting but to switch gears perhaps a little bit and look at approaching it in a different manner.

They did mention things like the sustainability, the ecosystem. These are the strong messages that we have to get out, rather than simply to talk about perhaps our culture. We have been doing it for 500 years; we have a right to do it for as many years as we like.

As well, there is a question, there is a weakness, I believe, because we are finding out with regard to the Inuit and our Aboriginal hunts that just an exception is not acceptable to them, and the Europeans are having some difficulty in trying to come to grips with how they are going to deal with banning a traditional commercial hunt of Aboriginal people and how that will play out.

What we are finding, I believe I can say, is that there is some hope. We do not have the resources of perhaps our nation, but we are hoping that if we can find ways in which perhaps we can convince them, and we are not going to just sit back and not ask Canada to engage in this as well, because we have to. As well, as you know, the G-20 nations are meeting even as we speak, and one of the things that the Prime Minister has come out and said is that there should be absolutely no trade restrictions or barriers put up in the next twelve months.

I think that we have a good case there and, again, we are pushing to make sure that the Europeans know that. As well, with the world trade action, I think what we have discovered is that the only way that we can get them to move off their position is to do something that certainly hits home to them. Trade action, dealing with the Aboriginal question, basically the G-20 thing, and the sustainability ecosystem, these are all areas that we believe we can make inroads in. We are working through the ambassadors to get us in contact with the various countries and to get some sense from them as to who we should be lobbying.

There is no way that we can get to over 700 parliamentarians over there but you have to realize, too, that there are three aspects of the Parliament the process has to go through. The commission that oversees the Parliament, we know that their position is a ban, yet with derogation. That is the position they are putting forth, and they have assured us that is the position they are going to take; but, again, there are countries that we need to get on side, not 50 per cent, but they tell us that if we can get a significant number of allies then that is possible, that compromise can be put forth.

We are laying it out, and the only thing I can say is that, given our resources, regardless, we cannot depend upon the federal government to get us to where we need to go. Even though we do not have the resources, perhaps, to match, we have to make sure that we are looking after the best interest of our sealers. We have to try. We cannot just sit back and wait until a decision is made and then probably reflect on: What if we had to do this? What if we had to do that?

MS JONES: With regard to the Canadian meetings regarding the European Union issues, have you guys had people at that table? Didn't they meet there a few weeks ago, a few months ago, or something, across Canada?

MR. HEDDERSON: I guess the only table we are around is with regard to the seal. What else?

MR. O'RIELLY: Do you mean with respect to trade matters or seals?

MS JONES: Yes, didn't they host a meeting in Winnipeg or somewhere there awhile ago? What was that about?

MR. O'RIELLY: Was it trade related?

MS JONES: Yes.

MR. O'RIELLY: We do have, as a department, a trade analyst who focuses entirely, exclusively, on seafood products, of course. We are the only department, I think, outside of INTRD that has somebody focused on the trade issue. Given its importance and its potential for us, for our industry, going forward, a key prior to that analysis has to do with what is happening with the European Union and the various trade activities.

MS JONES: Who is that person?

MR. O'RIELLY: The gentleman's name is Paul Paddle. He has been on staff with us for roughly a year-and-a-half now, dedicated exclusively to the task of seafood trade.

MS JONES: I thought a while ago there was a meeting of representatives from across Canada to look at the Canadian strategy and the perspective that they were going to present to the European Union. I was wondering if you guys had anybody at those meetings. I cannot remember the date, probably because I am kind of tired now, but I am trying to remember and I cannot. I cannot remember if it was before Christmas or after Christmas, to tell you the truth.

MR. DELANEY: There is a national committee called sea trade and we have representatives who attend those meetings on a regular basis. There was one out west recently, I am not sure if it was Winnipeg or not, but we had people from INTRD there as well as a representative from Justice, and they attend those meetings on a regular basis.

MS JONES: That must have been the one I was talking about.

MR. DELANEY: There was a meeting in Ottawa on sea trade as well this year, and we had a representative there. Paul Paddle represented the department.

MS JONES: Just a couple of more questions. One is with regard to the fees that are paid by processors and harvesters and so on, to the department. Can I get a list of what fees the department now charges to the sector groups and individuals, and how much they are? You can have it sent over to me or something; that will be fine.

MR. LEWIS: The fish processing licensing application fees and the fish processing licensing fees are all on the departmental Web site, but we can provide them as well if necessary.

MS JONES: The only reason I ask, I have had a couple of calls with regard to the fees, and the increase in the fees over the last ten years, and the numbers of fees being charged. I am not aware; I am just going on what other people have told me when they called me. So I would like to get a list of what those fees are, and what the increase or decreases have been over the last ten years.

The only other question I had was with regard to the early retirement program. You guys made a public statement on that back a while ago, in terms of adjustment for fisheries workers. Do you want to tell me what your plans are, what you are doing?

MR. HEDDERSON: Worker adjustment and that, we will talk a little bit about that, but the early retirement was tied into, I guess, the fisheries renewal?

OFFICIAL: (Inaudible).

MR. HEDDERSON: It was a partnership between – supposedly a partnership between - the federal government and the provincial government, and it mirrored some of the early retirement programs perhaps back in the 1990s.

Of course, it was not a partnership, it was a request for partnership, and we indicated that we would put up 30 per cent if indeed the federal government would come forth with 70 per cent, and that it would be, I guess the thoughts were, just across industry and, if I am not mistaken - and I am just looking at my officials; correct me if I am wrong - it was earmarked towards plant workers.

Alastair?

MR. O'RIELLY: That is correct. The concept, at various times, talked about harvesters and/or plant workers, but most of the focus for the harvesting sector had to do with proposals for licence buyout, and used that as a mechanism for removing some of the extra capacity.

In the case of plant workers it was more of a conventional, as the minister said, concept based on the kinds of programs that were carried out in the past under the adjustment programs following the 1992 moratorium issues, the NCARP programs and TAGS programs. In those programs, these proposals were advanced to the federal government but, as the minister noted, at the end of that process the federal government indicated they were not willing to engage in that activity.

The issue is still being raised, of course, and recently the FFAW has talked about the concept of looking at doing something on an individual plant basis, but it really is very much kind of an embryonic thing at the moment. They have not fleshed it out as a proposal, so it has to be debated with the industry as to whether or not there is receptivity among processors to participate in such a program, and on what basis.

Of course, in the early days, the initial reaction has been mixed. Some people seem to think it has merit and is worthy of consideration; others are of the view that there is a challenge in getting enough workers at the moment, so they are somewhat reluctant to engage in a discussion about early retirement.

That is where it is, I guess, as we speak. We do not have a proposal from the industry other than the concept. We have an expectation that the FFAW is going to continue to advance it and their suggestion to us that they are going to come forward with something at some future point.

MS JONES: So you are waiting on the companies?

MR. O'RIELLY: Yes.

MS JONES: And it would still be 30 per cent? You may have said that but I –

MR. HEDDERSON: Well, the 30 per cent is off, I would think, in the sense of saying that because their assumption was that if you had 30 per cent, well take that money now and just automatically put it into what you can do with plan specific.

What I have indicated to them is basically we need a proposal that we need to put through government process and then to put a dollar value on it. Also, that we would not go forward unless we truly consulted with the industry, not only the harvesting side but obviously the processing side as well.

So I am expecting at least the union to come forward with some sort of a proposal that will kindly jump-start it, but where it will lead to I can only surmise. The fact is that we are open to discussion, but at this time would not be able to speculate on what form it would take and where my government would be on it. What I did say to them, I might add, is that it is not so much retirement but it is the recruitment and retention that we really need to look at and tie all of that in together.

Now with the harvesting, with the combining of enterprises and that, that is kind of working as well but there is still in all aspects of the industry, that recruitment of, not necessarily younger people but people coming into the industry, and I think it is problematic. Most sectors will agree that we have to look at some solid proposals in how we can attract workers into these jobs because naturally without that recruitment we may be in a different position five, ten years down the road, especially when we look at our rural areas and that and how important it is that we address it.

MS JONES: I am just asking Amanda if she has anything.

MR. HEDDERSON: Yes.

MS JONES: I was wondering about the – I actually asked this question a couple of days ago, you were not in the House that day, about the fisheries research vessel. Have you secured a vessel yet or are you working on it?

MR. HEDDERSON: I guess, in a small way we have. If you notice that I referenced George Rose who is doing some work for us. I do not think this is the vessel that you are referring to but we are trying to outfit him with a vessel to carry out his research, but that is more of a one person research. I think the one you are referring to is a bigger research vessel and that is more tied into an oceans policy that we are developing. I would have to say that we will see what comes of that as that strategy is unfolded and then we move forward. Quite obviously, to basically outfit a research vessel, and so on and so forth, does cost a fair dollar.

On the other side of it, we continue to push our federal government because as you saw, the cod reporter came out the other day and they talked about surveys and that. We feel very, very strongly that the feds do not have the research capacity. As a matter of fact, I think their vessel is tied up now, if I am not mistaken, on dry dock or whatever and an important part of the survey cannot be done. That boat is all calibrated and so on and so forth. I am told that it is broken down more than it is going.

So where we are at is to basically, again, try to encourage the federal government to make sure that their research capacity is up. We thought with the stimulus package and some of the frigates that they were constructing, that one of those would be that research boat but it is not.

MS JONES: No wonder we got the science we got on the cod stock this year, according to that.

MR. HEDDERSON: What is that again, I am sorry?

MS JONES: I said it is no wonder we got the science we got on the cod stock this year, according to that.

MR. HEDDERSON: Yes. Like I said, we tried to – because George Rose, as I am sure you are aware, is probably one of the foremost authorities on cod and whatever and he is doing fabulous work. We are trying to support him in every way we can but there is only so much that one person can do and we wish we had more than one George Rose.

MS JONES: No, I was asking because according to John Furlong on the broadcast, you have the Farley Mowat almost ready at a port here in St. John's somewhere.

MR. HEDDERSON: Can you imagine the optics of that? I think it was reported that one of us was over looking at it. I do not know if there was anyone but no one will admit it. I would have to pass it on to our Deputy Minister to make sure that we realize – he has not directed anyone to (inaudible).

MS JONES: I did hear that she was seized by the federal government but I did not know the Province was -

MR. HEDDERSON: I know what we want to do with the type of Farley Mowats that are out there but I will not say.

OFFICIAL: I think it was an April 1 event.

MS JONES: Just a question now as well from Amanda. You are spending $4 million or more on -

OFFICIAL: (Inaudible).

MS JONES: Oh, I am sorry.

Mr. Chairman, I have a question that is being put forward by Ms Michael who cannot be here this evening and I just wonder if I could have the indulgence to do that?

CHAIR: Yes, that is not a problem.

MS JONES: Okay. You are spending $4 million or more on an aquaculture health centre. Is government concerned about some sort of disease attacking the aquaculture industry similar to the Aleutian disease which badly hurt the mink industry last year in the Province?

MR. HEDDERSON: Okay. That is the veterinarian centre that we are putting up in St. Alban's. Obviously, we are going to spend a little bit more than $4 million, but this year I think we are spending three-point-something million and it is going to take two years to do.

We are already carrying out some of the services, if not all of them, which would be in that building, but we are running out of space. This is standard. This is a standard procedure that we need that type - I think when the hon. member went down through and pointed out the lab services that we have to put out of the Province, which was about half a million dollars I thought when we went down through it. Those sorts of things then we could do within Province. It is standard for any province that has that type of industry. That is part of the infrastructure. We have been making sure that has been on the books, ready to go. We have had some design difficulties, as Brian has mentioned already. Again, I am confident to - just add a little bit more detail, Brian, just kick in there.

MR. MEANEY: The aquaculture aquatic animal health program is a key component of the department's activities. We conduct surveillance on every operation in the Province. It is really no different than any other livestock industry, agriculture.

To put it in perspective, we have roughly a little over 2 million animals in our agriculture industry. They are serviced by nine veterinarians. We have something like 20 million fish swimming that are serviced by three veterinarians in our Province. We maintain a complete surveillance on all the fish operations. Each farm is visited on a monthly basis by one of our veterinarians. There is a complete sweep of diagnostic tests that are done, and those are provided to ensure that we have an ongoing healthy and vibrant industry.

MS JONES: Are there any diseases now within aquaculture, any of the stocks that we should know about, that are surfacing in the last couple of years that may not have been there previous?

MR. MEANEY: No, all the fish that we use in our aquaculture operations, when they are placed in cages, they were certified disease free. All our fish come from only disease-free hatcheries. All our fish are vaccinated against the known endemic diseases that we have in Newfoundland. There are fish diseases in all our fish populations, fresh water and marine and wild, and we vaccinate our fish against those known diseases in there to ensure that they do not contract those diseases.

MS JONES: Thank you, Minister, and I thank your officials. I really appreciate your time and your patience.

Thank you, Mr. Chairman.

CHAIR: Any further questions?

Mr. Buckingham.

MR. BUCKINGHAM: Just very quickly, under the Salary Details - and this is just more for my own education - under Aquaculture Administration and Support Services, under Permanent and Other Adjustments, on page 95 of the Salary Details, it is $440,019 which represents about 20 per cent of your full salary allotment. I am just wondering what types of things go into those permanent and other adjustments.

MR. HEDDERSON: Just give us some time; we are just going through it.

MR. BUCKINGHAM: I can defer that and someone can forward the answer on to me later.

MR MEANEY: Those items would include for the new positions for that particular branch, the Aquaculture Branch, and as well would include the salary increases for all the employees in the branch.

MR. BUCKINGHAM: Okay.

Thank you.

CHAIR: Any further questions?

MS PERRY: Yes, Sir.

CHAIR: Ms Perry.

MS PERRY: My question is: When is the tender going to be called for the building?

MR. HEDDERSON: Brian, you go ahead.

MR. MEANEY: Our anticipation is that we would have the tender documents concluded by the end of this month and then go directly to a call for proposals and tend the process then. So we are in the final process of –

MS PERRY: By May at the –

MR. MEANEY: Yes, try to get the tender in to the public process by the first of May.

MS PERRY: Thanks.

CHAIR: Any further questions?

Does the minister have any concluding remarks that he would like to make?

MR. HEDDERSON: Just to thank the members for their participation tonight. Certainly, we will follow up, I think, on one or two things for the hon. member across the way.

Again, to our Committee Chair and our support staff, I thank you.

With that, I think we can proceed to the call.

CHAIR: Thank you, Sir.

I will ask the clerk to call the subheads.

CLERK: Subheads 1.1.01 to 3.1.02.

CHAIR: Subheads 1.1.01 to 3.1.02 inclusive.

Shall these subheads carry?

All those in favour, 'aye'.

SOME HON. MEMBERS: Aye.

CHAIR: All those against, 'nay'.

Carried.

On motion, subheads 1.1.01 through 3.1.02 carried.

CHAIR: Shall the total carry?

All those in favour, 'aye'.

SOME HON. MEMBERS: Aye.

CHAIR: All those against, 'nay'.

Carried.

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

CHAIR: Shall I report the Estimates of the Department of Fisheries and Aquaculture for 2009-2010 carried without amendment?

All those in favour, 'aye'.

SOME HON. MEMBERS: Aye.

CHAIR: All those against, 'nay'.

Carried.

On motion, Estimates of the Department of Fisheries and Aquaculture carried without amendment.

CHAIR: Before we adjourn, you have two sets of minutes passed out. I would like to have motions now to adopt these minutes.

The first one is for the minutes held on March 31 for the Department of Tourism, Culture and Recreation. Can someone move that?

MR. LODER: So moved.

CHAIR: Moved by Mr. Loder, seconded by Mr. Buckingham, that the minutes for the Department of Tourism, Culture and Recreation carry as circulated.

All those in favour, 'aye'.

SOME HON. MEMBERS: Aye.

CHAIR: All those against, 'nay'.

Carried.

On motion, minutes for the Department of Tourism, Culture and Recreation adopted as circulated.

CHAIR: A motion for the minutes of the Department of Business held on April 1, will someone move that?

MR. BUCKINGHAM: So moved.

CHAIR: Mr. Buckingham; Ms Perry seconded.

All those in favour, that the minutes be adopted as circulated, ‘aye'.

SOME HON. MEMBERS: Aye.

CHAIR: All those against, 'nay'.

Carried.

On motion, minutes for the Department of Business adopted as circulated.

CHAIR: I would like to thank Minister Hedderson and his officials, as well as our Committee members and the House of Assembly staff, and also the observers who have been here again this evening.

The only other thing I want to mention is that the next meeting – and, no doubt, you will get notice later on - is going to be after the Easter break. The next meeting for the Resource Committee will be on Tuesday, April 28, and at that time we will be doing the Department of Innovation, Trade and Rural Development.

Now I will ask for a motion to adjourn.

MR. LODER: So moved.

CHAIR: Mr. Loder.

This meeting now stands adjourned.