May 1,
2017
RESOURCE COMMITTEE
Pursuant to Standing Order 68, Steve Kent, MHA for Mount Pearl North,
substitutes for Kevin Parsons, MHA for Cape St. Francis.
Pursuant to Standing Order 68, Ms. Rogers, MHA for St. John's Centre,
substitutes for Ms. Michael, MHA for St. John's East Quidi Vidi.
The Committee met at 6:02 p.m. in the Assembly Chamber.
CHAIR (Warr):
Good evening one and all. Welcome to the Estimates on Tourism, Culture, Industry
and Innovation.
Before we get underway, just a few housekeeping issues. This is the Resource
Committee. Mr. Kent is substituting tonight for Mr. Parsons and Ms. Rogers is
substituting for Ms. Michael.
Before we get underway, the Chair would entertain a motion to approve the
minutes of the Resource Committee for the Department of Fisheries and Land
Resources.
CLERK (Hammond):
You have to circulate the minutes.
CHAIR:
Oh, I'm sorry. Okay.
Now that you have copies of the minutes, the Chair will entertain a motion to
move the Resource Committee minutes for April 11, 2017 for the Department of
Fisheries and Land Resources.
MR. FINN:
So moved.
CHAIR:
Moved by John Finn.
Seconder?
MR. BRAGG:
Second.
CHAIR:
Derrick Bragg.
All those in favour?
Passed.
On motion, minutes adopted as circulated.
CHAIR:
I just remind the staff and any of our people asking questions tonight to state
your name and recognize that your tally light is on and proceed.
With the acceptance of everybody, we're going to start off with 4.2.04.
I'd ask the Clerk to call the first heading, please.
CLERK:
4.2.04.
CHAIR:
Minister, if you'd like to have a few opening remarks and introduce your staff.
MR. MITCHELMORE:
I'll just introduce myself as Christopher Mitchelmore, the Minister of Tourism,
Culture, Industry and Innovation and Minister Responsible for the Research &
Development
Corporation.
I think
to give maximum time to everybody in the Opposition this department covers a
lot, so if they have questions I want to give them the maximum three hours that
we have allocated for Estimates.
I'll
pass it over for my staff to introduce themselves.
MR. LOMOND:
Ted Lomond, Deputy Minister.
MS. MURPHY:
Carmela Murphy, Assistant Deputy Minister.
MR. GARDNER:
Ben Gardner, Assistant Deputy Minister.
MR. PLOUGHMAN:
Mark Ploughman, Acting CEO of the Research & Development Corporation.
MR. MAY:
Levi May, Chief Financial Officer, Research & Development Corporation.
MR. KIELLEY:
Marc Kielley, Assistant Deputy Minister.
MS. HAYES:
Robyn Hayes, Department Controller.
MS. DICKS:
Andrea Dicks, Director of Corporate Services.
MS. HUNT-GROUCHY:
Michelle Hunt-Grouchy, Director of Communications.
MR. HOLLOWAY:
Colin Holloway, Parliamentary Secretary to the minister and the MHA for the
District of Terra Nova.
MR. GEORGE:
Bradley George, Executive Assistant to the minister.
MS. HUMPHRIES:
Donna Marie Humphries, Director of Finance, The Rooms.
CHAIR:
Thank you.
We'll
turn it over to Mr. Kent.
MR. KENT:
Thank you.
Good
evening. It's nice to see a few familiar faces and some new ones as well.
Mr.
Chair, I understand we're going to ask our few questions about The Rooms
Corporation to get started. I have some broader questions about the department
overall that we'll get to later. I'm going to get right into the specifics
related to The Rooms and my colleague probably has some questions as well.
We're
looking at 4.2.04, which is the entire amount of funding that goes to support
The Rooms Corporation. There's only a slight change to the budget. I think it's
down by close to $83,000. I was just wondering if the minister could comment on
that and tell us why the slight reduction. What does that mean?
MR. MITCHELMORE:
I certainly can.
I want
to say that The Rooms has proven itself in terms of being able to raise
additional revenue and not have as much dependency on government grants to do
more. The Rooms visitation increased by 21,000 people in 2016 raising commercial
revenue by $185,000 and their social media reach was a big part of that,
increasing by over 500 per cent.
They
won significant awards, 16 different awards at national, even the local level,
primarily from around the World War I exhibit relating to Beaumont-Hamel. We
have Canada's largest permanent World War I exhibit and that drew a lot of
interest. It also generated $12 million in private sector funding to develop the
amphitheatre and to do the exhibit. Plus, The Rooms is taking an approach of a
cultural immersion program where they're going to be adding more programming and
experience which is going to draw upon not only local visitors but the
international visitor as well.
To get
into some specifics of the line-by-line decrease, what makes that up is
generally from a zero-based budgeting point of view what The Rooms did is they
looked at how they could reduce their operating expenses of whether it's
purchasing less paper, doing less travel, be a reduction of $200,000 in a
line-by-line review of what was over a $6.6 million budget, beyond all the other
revenues that they gained from earned revenues such as admission, gift shop
sales and a variety of other things that The Rooms does.
Also,
there was an increase in funding for the final phase of the job evaluation
survey cost of about $67,400. There was a reduction in salaries for two
positions as was tabled here in the House of Assembly for the two management
positions as part of a Flatter, Leaner Management process of $150,200.
MR. KENT:
Thank you, Minister.
Just a
couple of follow-up questions related to that and I have maybe a couple of other
questions related to The Rooms following that. Could you tell me what that
revenue number was? You mentioned that there was a revenue increase. Maybe you
did say it, but can you tell me what the revenue increase was because that
obviously would explain some of the lessened dependence on the government grant.
MR. MITCHELMORE:
Yeah.
There
was $185,000 in commercial revenue.
MR. KENT:
Okay.
MR. MITCHELMORE:
When you look at a
line-by-line review of reducing by $200,000, these were expenses that were
deemed as a means of finding savings. So you're not going to have those recur,
whether you're purchasing less paper, less supplies, doing less travel, doing
things in a more efficient way, maybe cutting down on the number of telephone
lines that you would have and things like that. They found a total of $200,000,
but they also have additional commercial revenue beyond the earned revenues. So
the $185,000 places The Rooms in a good position.
MR. KENT:
Okay.
Revenue
is up by $185,000 in the commercial revenue.
MR. MITCHELMORE:
Yeah.
MR. KENT:
There are two positions that
have been cut. As a result of the zero-based budgeting exercise, as it's being
called, there were some minor cuts to various line items, savings for phone
lines and paper and whatever the case may be.
If you
factor all those things in, wouldn't that potentially lead to a greater
reduction in the Grants and Subsidies than $82,800? I mean two positions coming
out, plus a revenue increase, plus the $200,000 in cuts on the overall budget;
it just seems to me that $82,800 could potentially be bigger then, if my math is
correct.
MR. MITCHELMORE:
There were funds added back
to the Job Evaluation System cost.
MR. KENT:
Oh, that led to an increase.
MR. MITCHELMORE:
That led to an increase.
MR. KENT:
Okay.
MR. MITCHELMORE:
And government provided an
increase to cover that cost as it would for any of its employees in either
bargaining, non-bargaining. There are annual JES increases that were committed,
as you would have been aware as a former minister.
MR. KENT:
Right.
Okay.
Thank you for that.
Two
questions before I'll pass things over to my colleague. The Grants and Subsidies
line as it's shown here, my understanding is that includes in totality the
provincial government funding that is provided to The Rooms. Is that correct? Is
that what that number represents?
Is
there anything else that's part of that Grants and Subsidies line, or anything
that goes to The Rooms that's not covered here, I guess, would be the other part
of the question?
MR. MITCHELMORE:
There could be some
additional funding throughout the department that will go to The Rooms or across
other departments depending on what The Rooms is doing. One thing in particular,
as we go through our line by lines, it would probably explain the reinstatement
of the Art Bank Program that was cut a couple of years ago under the previous
administration.
MR. KENT:
Okay.
This
year, as a result of the budget review, as a result of the budget that's now
been approved for The Rooms Corporation, have there been any reductions to staff
or hours of operation at The Rooms?
MR. MITCHELMORE:
The impact to staffing were
the two positions as noted.
MR. KENT:
Right, but beyond that.
MR. MITCHELMORE:
Beyond that, there has not
been. The Rooms right now, as of today, they started their cultural experience
program. As music Monday, they had the Shallaway choir there today to kick off
their opening on Mondays. So they are open every day of the week during the
summer.
Hopefully, the visitation and through this program that's being launched, more
revenues will be raised that would allow them to stay open longer and be
available to the public. That's every intent of The Rooms, The Rooms management
and the board of directors. They want to have The Rooms as a place for people to
go, for people to access and enjoy all that it has to offer. It's truly our
cultural gem here in the province.
MR. KENT:
Yeah, it's an amazing
facility and it would be great to see even more people access it. I'm encouraged
to hear there was an increase of 21,000 people, so that's good news.
Will
you be singing or dancing at The Rooms at any point this summer?
MR. MITCHELMORE:
There will be no singing for
me, Sir.
MR. KENT:
Okay.
That's
a relief to the people of the province.
MR. MITCHELMORE:
I do want to say as well,
though, that The Rooms does plan on being open on Friday and possibly Saturday
evenings during the summer tourism season as well to cater towards that
clientele. That's something that's obviously being reviewed by the management
and the board to determine that. They anticipate that it should be a busy year
for them. They had a great year last year, and with a Cultural Ambassadors and
immersion program that they're kicking off, it should lead to more interest.
They've
done things in the past such as culture and cocktails. They've done different
things around their theatre. They've done special one-offs that have happened
throughout the year, truly testing the market.
They
were at the Downhome Expo at the Glacier in Mount Pearl promoting their
volunteer ambassadors program. So if you know of anybody who is interested in
volunteering at The Rooms being a Cultural Ambassador, certainly, we encourage
people to get the message out there.
MR. KENT:
I said I only had two, but I
have another.
You
just mentioned some of the outreach that The Rooms is doing. I recall there was
some kind of program that connected The Rooms to rural parts of the province,
parts of the province outside of the Avalon region. Are there any programs
continuing that allow The Rooms to bring its programming across the province?
Has that been impacted in any way by structural changes or budget changes?
MR. MITCHELMORE:
The Rooms has regional
museums. They would have the Mary March museum in Grand Falls-Windsor and they
have the Grand Bank museum. They also have the Labrador Interpretation Centre,
basically The Rooms branch in North West River. So there are three entities
which give The Rooms a regional presence, and to the extent possible The Rooms
provides support and outreach to these entities.
There
certainly is a possibility this would be something that the management and
through the board, as they're looking at these cultural programs, maybe be able
to deliver programming as well on a regional level which would be good. The
Rooms has, in the past, done a touring program.
MR. KENT:
Yeah.
MR. MITCHELMORE:
They're not just exclusive
to the St. John's, capital city region. They have undergone a digitizing project
with the International Grenfell Association to digitize documents. They partner,
they work with other entities and they've travelled on and did a roadshow as
well for World War I exhibits.
There
are a lot of things that The Rooms does and can do, but obviously there are
limitations. They do have a budget; they have to live within their budget. They
are doing a lot of creative things and outreach to the community as well.
MR. KENT:
Will the touring program be
reduced this year compared to previous years?
MR. MITCHELMORE:
Well, the touring program
wasn't intended to actually collect artifacts and things relating to the
permanent exhibit. It was part of developing the Honour 100, their World War I,
Where Once They Stood, We Stand campaign. There is no intent to reduce their
programming.
Their
focus right now is around cultural immersion and programing and ways to enhance
the experience. Actually, they secured funds through Scotiabank to deliver their
cultural programming and supports. So that's one avenue and one entity.
They've
worked through The Rooms Foundation, their charity. They also work with a lot of
donors and a lot of partners. They've been soliciting feedback from their
members as to how they operate and find better ways to do business, to deliver
programs and services that are relevant to their clientele.
MR. KENT:
And my final question on The
Rooms, I promise: Is there a direct connection between the programs and services
offered through The Rooms Corporation and the K to 12 school system? Are there
programs where The Rooms works with our schools across the province to promote
our history, our culture, arts, et cetera?
MR. MITCHELMORE:
The Rooms partners in a
number of situations. The Arts and Letters competition awards gala gets held at
The Rooms where people's art from all over schools across the province and
people of all ages, basically, get on display at the gallery. It's quite a
welcoming venue.
There's
a tots program that comes into play. There are a lot of school groups that would
be going to The Rooms and travelling. They have educational programs there.
If you
go into The Rooms, there were hundreds of people that would have designed the
forget-me-nots that are on the ceiling. So there are a lot of beautiful projects
that happen that The Rooms is connected with.
It's a
great venue. It's a public space. It's available to people. A significant amount
of group tours take place at The Rooms.
MR. KENT:
Thank you.
MS. ROGERS:
Good job.
MR. KENT:
Thanks.
Did I
leave anything for you?
MS. ROGERS:
A few things, but you did a
good job.
CHAIR:
Ms. Rogers.
MS. ROGERS:
Thank you very much.
I'm
Gerry Rogers; I work for the good people of St. John's Centre. Thank you very
much for coming this evening.
I know
after a very long day of work this is not always the easiest thing to do when
you want to go home. Thank you very much for doing this.
The
Rooms; I want to send my congratulations to the staff for a stellar year, and
sometimes under very difficult circumstances with some uncertainty about
funding, uncertainty about reorganization and that. I think there's a lot for
staff to be proud of. If you could relay that message, thank you so very much.
Steve
really dug in there deep. I don't have a whole lot more to ask.
I'm
wondering: What is the situation now where there was a lot of controversy about
the three different departments? Where is that now? How is that going forward?
What's the plan?
MR. MITCHELMORE:
Well, The Rooms recently
undertook some targeted stakeholder engagement sessions. Just recently actually,
where they would have had the Visual Artists Newfoundland and Labrador, VANL;
there would have been the Museum Association of Newfoundland and Labrador; the
archive, ANLA; the archeology association here in the province; as well as the
Craft Council and partners and members that would be interested to engage around
the strategic plan. Also, there's an online survey at The Rooms available for
people to have input around programming and different things, the customer
experience at The Rooms.
In
terms of the structure at The Rooms, there remains three directors at The Rooms:
a director of the art gallery, a director of the archives and a director of the
museum. There are also people that are involved in the role of finance, as Donna
Marie is here this evening, and the CEO. It's a fairly lean management structure
after going through the zero-based budgeting, but there are avenues and
opportunities which, when you look at the expertise that exists in The Rooms, as
we've said, to find ways to create the best synergy.
I think
it really hits home when you look at the volunteer program, what the potential
is for Cultural Ambassadors and to deliver programming. Whether it be looking at
the archives and unique documents or looking at artifacts that we would have in
the vaults that never get on display. Or the ability to have that level of
engagement and to have that team approach can only be positive; can only drive
further revenues, visitation and further opportunities at The Rooms Corporation.
We saw
that when people came together and all supported, developed and created
something very beautiful in the World War I exhibit that's there. It wasn't just
done by one entity; it took the whole team effort to really be able to produce
that. I think the more of that we can do to reduce where people are doing very
similar tasks and find ways to collaborate will only do The Rooms well into the
future.
MS. ROGERS:
Okay.
Is
there any plan to increase membership or increase the cost of single entry or
family entry?
MR. MITCHELMORE:
There were no changes to any
fee in Budget 2016 or 2017. There is
a real push, though, in The Rooms wanting to promote its memberships and the
value of being a member, and that members get extra additional benefits such as,
whether it would be a discount at The Rooms Cafι, the Red Oak there. You go
there and enjoy a nice lunch. The same thing with the gift shop, you get a
discount for a purchase. There may be ways of which you get preferential
invites.
MS. ROGERS:
That always happens.
MR. MITCHELMORE:
There are lots of things
that can be done around memberships. It's so important that you do and that's
why they've been talking to and engaging their membership, to find out how they
can get maximum value. It's no different than looking at Marble Mountain
Development Corporation in terms of having season pass holders.
The
Rooms members are the most valued people in that organization because they
commit. They're regular attendees. They're going to the exhibits.
They're
going to be hosting a Gerry Squires retrospective exhibition opening later this
month and running throughout the summer season. That should draw a lot of local
and also Canadian and international interest. I mean Gerry Squires was such a
talent.
We're
quite pleased to see this type of activity take place. It's important. The
memberships are critical. I think if you have ideas or suggestions as to how we
can enhance and grow memberships I'd be certainly open to hearing that.
MS. ROGERS:
So there's no plan to
increase the membership fees or the single entry fees at this point?
MR. MITCHELMORE:
Well, anything that is
related to The Rooms, this would be a decision of the management to put before
their board in terms of operations.
MS. ROGERS:
Okay.
MR. MITCHELMORE:
In terms of our budget
2017-2018, there were no fee increases.
MS. ROGERS:
Okay, great.
Parking; is there a plan to charge for parking?
MR. MITCHELMORE:
There has been a plan, I
think, by the board to look at a parking fee, in particular around people who
park at night and use that facility and take up parking spaces. Parking downtown
is at a premium, so when there's maybe a concert taking place at a close school
or somewhere in the area, if the spaces are all filled, then we can't have
customers coming Saturday night or Friday night at The Rooms.
It does
pose to be a problem, but I do think there are solutions, of which those who are
paying customers at The Rooms do not necessarily need to pay more, that it could
be included. The cost of parking could be included if they buy admission to The
Rooms to use the services at the facility. There are avenues of which there
would not be an increased cost. The same thing with members; parking may be
included with an annual membership to The Rooms.
MS. ROGERS:
Okay.
MR. MITCHELMORE:
The intent of parking is to
deter those who are parking long term in the evenings in the hours and taking
away much-needed earned revenue that The Rooms must have. There are also tenants
at The Rooms, like the caterer that is there. We want people to be using that
service so that they can create the private sector jobs that are there at The
Rooms as well through the contracted service.
MS. ROGERS:
The plan for Friday and
Saturday night, is there an expanded service that's going to happen? What's the
plan there for Friday and Saturday night?
MR. MITCHELMORE:
Yeah. The Rooms has been
doing a pilot around culture and cocktails where they've been bringing in an
artist, a singer. They've had drinks there.
MS. ROGERS:
Yeah.
MR. MITCHELMORE:
It's usually been between 7
o'clock to 9 o'clock, so it's a prequel to going somewhere else, going to
another venue. It's a starter between maybe going to a restaurant in the
downtown or maybe going to an entertainment venue in the downtown. It's not
meant to be competitive, it's meant to support the arts community and also get
more people coming into The Rooms for something new and something different, as
well as supporting the downtown business community indirectly.
MS. ROGERS:
Yeah.
MR. MITCHELMORE:
That's the overall intent
and that's part of the Cultural Ambassador program which is being planned to be
rolled out. Certainly, the more support from volunteers and people interested,
then the more successful The Rooms can be around some of these evening
activities.
MS. ROGERS:
One last question.
Thank
you very much. That's a lot of information.
The
revenue increase that is $185,000 commercial; what is that? What would be
commercial revenue for The Rooms?
OFFICIAL:
Fees.
MS. ROGERS:
Fees?
OFFICIAL:
Fees that people pay, yeah.
MR. MITCHELMORE:
General entry fees.
MS. ROGERS:
Okay.
MR. MITCHELMORE:
But I don't know, Donna Marie. Is it any more than that or is just
?
MS. ROGERS:
Or rentals?
MS. HUMPHRIES:
(Inaudible.)
MR. MITCHELMORE:
Okay, so it's all the
commercial revenue that The Rooms would have from gift shop sales, the
admissions that would come in and also room rentals. They do have a boardroom
and they rent out the theatre or other things to third parties that want to host
events.
MS. ROGERS:
Okay. Thank you.
I'm
good. Thank you very much.
CHAIR:
Thank you.
Can I
ask the Clerk to recall the subhead, please?
CLERK:
4.2.04.
CHAIR:
4.2.04.
Shall
the subhead carry?
All
those in favour?
SOME HON. MEMBERS:
Aye.
CHAIR:
Those against?
Carried.
On
motion, subhead 4.2.04 carried.
CHAIR:
I ask the Clerk to call the
next subhead.
CLERK:
2.3.01.
CHAIR:
2.3.01.
Ms.
Rogers, you can start this session.
MS. ROGERS:
Sorry, where are we going
now?
CHAIR:
2.3.01.
MS. ROGERS:
2.3.01, okay.
MR. MITCHELMORE:
The Research & Development
Corporation.
MR. KENT:
I can go if you need time.
MS. ROGERS:
Yeah, you go ahead.
MR. KENT:
Are you sure?
MS. ROGERS:
Yeah.
CHAIR:
Go ahead, Mr. Kent.
MR. KENT:
Thank you.
I'll
start while Mr. Rogers gathers her notes.
I'm a
big proponent of the Research & Development Corporation. I'll start by asking
the minister: Are there any changes at all to the structure or mandate of the
Research & Development Corporation, over the last 18 months I guess, but
particularly since we last went through this process.
MR. MITCHELMORE:
There still remains an
acting CEO of the Research & Development Corporation. The structure; I don't
believe there have been any changes to the organizational structure at the
Research & Development Corporation over the last budgetary cycle. The Estimates
remain the same.
MR. KENT:
Okay.
Have
there been any recent staffing changes at the Research & Development Corporation
as a result of the budget? I noticed the budget is exactly the same, but have
there been any changes to positions or structure or staffing at RDC?
MR. MITCHELMORE:
There are still 39 staff
members at the Research & Development Corporation. That would account for $3.3
million in salaries and $17,666 in benefits. The benefits would be the 18 per
cent, CPP, EI, medical group, performance, pension, EAP, HAPSET and WorkplaceNL,
I guess the compensation around that.
I guess
at any given time there may be a vacancy or there may be somebody that you're
going to hire
MR. KENT:
Sure.
MR. MITCHELMORE:
but as part of the budgetary cycle as an agency, board and commission, this is
an entity that received some reductions in the past when it comes to staffing
and last year's budget of a reduction. It wasn't part of the Flatter, Leaner
Management Structure during the review at this point in time.
MR. KENT:
Related to that, it wasn't
part of the Flatter, Leaner, meaner management structure exercise that's gone
on, but I also note that so I'm curious as to why that was, maybe it's just
because of the impact of last year's cuts. I'd appreciate you commenting on
that. I'm also curious whether the government's zero-based budgeting exercise
happened at RDC as well.
MR. MITCHELMORE:
I take somewhat of an
exception when you talk about people and staff that are in management that have
expertise as flatter, meaner, you know, that whole process.
MR. KENT:
Well, it's your process.
MR. MITCHELMORE:
The impact of research and
development research and development is very important to Newfoundland and
Labrador and the economy. RDC has performance evaluations. They have certain
mechanisms that can be put into play to look at the leverage that exists when
they do a particular project, such as from a pre-commercial point of view.
RDC
only plays in the sphere of pre-commercial. Anything that goes to commercial is
dealt with through other mechanisms, whether it would be through the Department
of TCII or other financial lenders or whatever the case may be. The Research &
Development Corporation's mandate is to deal in that pre-commercial space.
MR. KENT:
Was there a conscious
decision made by you or Cabinet to exclude RDC from your Flatter, Leaner
Management exercise?
MR. MITCHELMORE:
Well, the RDC is part of one
of the many agencies, boards and commissions that exist within government. The
Marble Mountain Development Corporation would be another agency, board and
commission. You will be going through eight or 10 others as we go through the
Estimates, whether it's the Film Development Corporation or the Heritage
Foundation or the ArtsNL, Arts Council of Newfoundland and Labrador. The Rooms,
through its budgetary cycle, did because they're going through a strategic
planning session, went through and undertook zero-based budgeting.
The
Research & Development Corporation right now, based on their commitments of
having a number of projects ongoing, they also have expenditures that are in
excess of their revenues. Certainly further review needs to take place at the
Research & Development Corporation.
MR. KENT:
Okay, so there will be
further review.
The
regional health authorities, for instance, were directed to go through this
government zero-based budgeting exercise and also the Flatter, Leaner Management
exercise. Why was RDC not included in either?
MR. MITCHELMORE:
The Way Forward
highlighted that agencies, boards and commissions will go through a review.
MR. KENT:
So it will go through a
review on both fronts.
MR. MITCHELMORE:
Not all agencies, boards and
commissions have undertaken a review
MR. KENT:
Fair, yeah.
MR. MITCHELMORE:
and went through
zero-based budgeting and looked at a process of their management structure. Some
agencies, boards and commissions, as we'll go through my Estimates, have gone
through that process, such as the Heritage Foundation and others. We can
certainly talk about them. Some agencies, boards and commissions have embraced
zero-based budgeting and taken on that process to champion it, understanding the
economic conditions that we face in the province.
Not all
agencies, boards and commissions have embraced the zero-based budgeting process.
We saw that with Memorial University, for example. But there are avenues of
which a review will certainly take place.
MR. KENT:
Can we anticipate that
happening in this current fiscal year?
MR. MITCHELMORE:
I would think that a review
will take place with RDC within this fiscal year, yes.
MR. KENT:
Okay.
Switching to perhaps a more positive tone, it's really difficult, as you can
appreciate, from the one line of Grants and Subsidies going to RDC, to get an
appreciation for the work that's ongoing. I was wondering if, following tonight,
we could get a high-level overview of the current projects and initiatives
related to RDC.
I
believe there are a lot of good things happening within the corporation that
people don't know about. It would be helpful to have a better sense of currently
what's happening, and also what might be on the horizon in terms of future
vision and plans so we could get a better idea of how that considerable amount
of money is being spent.
MR. MITCHELMORE:
Yeah. There's $13.8 million
in programming, primarily broken up between academic and commercial, so about
$6.9 for each of the entities. There are 112 R & D projects that were
contracted.
MR. KENT:
How many, sorry?
MR. MITCHELMORE:
One hundred and twelve
projects last fiscal year.
MR. KENT:
Okay.
MR. MITCHELMORE:
The investment was $16
million. Some of that is because RDC commits to multi-year projects.
MR. KENT:
Right. Yeah.
MR. MITCHELMORE:
Because you commit to a
project and there are performance indicators, and you might not meet your
milestone, well, then the funds don't get disbursed, you still have time. It is
good business practice. It is good due diligence not to just cut a cheque and
get it out the door.
That
makes sense in that process that there will be $16 million, basically, last year
expended. That's because when RDC was set up, when they had larger budgets, they
held a lot of cash in the initial stages because they weren't necessarily
approving the projects. They weren't coming in as quickly; it took some time to
build up. But now they've committed their projects to move forward in a
multi-funded process. That $16 million led to a $29 million leverage.
All
lists of all of the projects that RDC funds are available publicly on their
website. Unless you want my office staff or the RDC to go through and print
those I mean, they are available on the website.
MR. KENT:
No, if you're saying the
entire breakdown on that $13.8 million of programming is available on the
website, then we can obviously access it there.
MR. MITCHELMORE:
Yeah.
MR. KENT:
I just figured there was
more than that available that's not it's not all available on the website, the
full detail on that $13.8 million, I wouldn't have thought.
MR. MITCHELMORE:
If there's something there
that you see would not be like we did a launch of our SensorTECH program and
the companies that received grants there. The funding to student research
projects, we did a public announcement on that. There was an announcement last
year that Minister Coady had completed as well on behalf of the Research &
Development Corporation.
The way
it is structured is that there's a lot of focus on oil and gas, mining and also
the ocean tech sector. That would basically account for two-thirds of the R & D
expenditures. The remaining one-third would then be for other investments in the
economy. That's kind of the focus of RDC. Whereas the Department of TCII would
be focusing on all aspects, whether it be life sciences and I know you've been
a big proponent of life sciences such as Sequence Bio and other entities.
CHAIR:
Mr. Kent, if I may, your
speaking time has expired. I'm going to go to Ms. Rogers and I'll come back to
you again.
MR. KENT:
Okay.
CHAIR:
Ms. Rogers.
MS. ROGERS:
Great, thank you very much.
When we
were speaking earlier this evening, I believe that perhaps this department, this
program, this agency is more crucial right now than ever in our history. Thank
you for your great work.
I'm
just wondering, what are some of the really cool and groovy projects that you're
proud of right now?
MR. MITCHELMORE:
I think when you look at
building a knowledge-based economy we have a great ecosystem here in
Newfoundland and Labrador. I was at an event with members of the Research &
Development Corporation, as well as TCII. We were at a Pitch & Pick event, the
evolution program at Genesis Centre at the Fifth Ticket. There were tons of
young, enthusiastic people looking at wanting to get in the start-up community
here, wanting to win that prize for their innovation. A number of apps were
being created on that aspect.
In
terms of some of the really cool things that Research & Development Corporation
does is around sensor technology. We had the opportunity to visit a place like
Kraken Sonar and to see what Kraken does around operating out of CBS and
downtown St. John's and having a number of young people employed. They're
basically using cameras, optical and sensor technology to play in that ocean
defence space. They have international contracts.
This is
the type of innovation that we want to see happen here in Newfoundland and
Labrador. There are some other great companies, like radient360 that offers
solutions to the oil and gas sector dealing with major companies around the
world. You talk about eSonar and fishing solutions for vessels around their
nets. Making sure that you know where the fish is and what to stay away from is
an important piece.
Also,
there are ways of which there's been productivity enhancements done in the oil
fields through research and development, where the life has been extended
because there's enhanced technology in place of getting more oil out of the
Hibernia wells. In doing so, that's maintaining those jobs for a longer period
of time. It's becoming more competitive and more efficient.
As
well, if we look at Anaconda on the Baie Verte Peninsula or Rambler Metals and
Mining of using different technology that takes place. Using something that
would have been used maybe in the diamond industry versus a copper mine or other
metals is a way of which the life of the mine has been extended by years. So
that's years of employment for local people. It's quite significant. Those types
of initiatives are extremely important.
MS. ROGERS:
Thank you.
CHAIR:
Mr. Kent.
MR. KENT:
Yeah, just one follow-up
question. A comment first and then my follow-up question.
We did
have a look at the website previously; I just had a very quick look now. I'm not
easily finding the breakdown of how that $13.8 million is spent.
MR. MITCHELMORE:
Okay.
MR. KENT:
So I would appreciate it if
your office would provide it.
MR. MITCHELMORE:
Sure. We can
MR. KENT:
Or send me the link, because
it's just not obvious from the website. There's lots of information there but
the breakdown I'm looking for is not, at least from what I can tell.
MR. MITCHELMORE:
We can provide a list of the
projects.
MR. KENT:
That would be great. Thanks.
And
MS. ROGERS:
And we would like
(inaudible).
MR. KENT:
I assume that anything we
ask for will be provided to both parties.
MR. MITCHELMORE:
Yes.
MR. KENT:
Okay, great.
Thank
you, the standard Estimates questions.
My
final question on RDC; I know in the past there was a desire to increase the
amount of commercial activity. You mentioned that the split continues to be
fairly even between academic and commercial. I'm just wondering in terms of your
plans and priorities, is there still a desire to increase activity on the
commercial side so that the scale tips? Has there been any progress in that
regard?
MR. MITCHELMORE:
There has been progress
made, but I would like to certainly see more towards the commercial.
MR. KENT:
Yeah.
MR. MITCHELMORE:
The commercial level will
lead to greater leverage. I think you would agree as well. There are avenues of
which maybe there can be more diversified investments made through research and
development.
If you
look at the fact, as I said, around life sciences, the potential of genetics,
the potential of where that sphere is, there's been limited investment through
the Research & Development Corporation. Whereas the Department of TCII has
supported entities like the EXCITE Corporation and Dr. Terry-Lynn Young with
their audiology and looking at hearing and the 'impairness' around populations
here in Newfoundland and Labrador to find real life solutions so that we can
improve hearing in our population and around the world. As well, looking at the
genome and looking at from that point of view. We've had several discussions
here in this House of Assembly on that type of aspect.
There
may be ability to broaden some of the work that takes place at the RDC to find
ways of which we can leverage more dollars, whether it would be through private
sector investment to get more commercial activity. It may need to be beyond the
initial targets that are focused so that we can really create that innovative
sphere and have accelerated growth here in Newfoundland and Labrador and create
a better pipeline; I think that's really key. So that as you move from
pre-commercial to commercial, there's a seamless transition so we're not leaving
people hanging in the lurch and that there are ways of which there's a greater
connectivity to the financing sources or the internationalization and ways of
which we can really grow Newfoundland and Labrador.
We
don't have significant time to waste. We need entrepreneurs that have these good
ideas to get where they need to go in an accelerated way. I think you would
agree with that as well.
MR. KENT:
I do agree with that.
Sometimes I agree with you.
MR. MITCHELMORE:
I know. That's surprising,
but we do agree here and there.
MR. KENT:
Yeah. On more than people
realize, probably.
That's
it for me, Mr. Chair.
CHAIR:
Thank you.
Can I
ask the Clerk to recall the subhead, please?
CLERK:
2.3.01.
CHAIR:
2.3.01.
Shall
the subhead carry?
All
those in favour?
SOME HON. MEMBERS:
Aye.
CHAIR:
Those opposed?
Carried.
On
motion, subhead 2.3.01 carried.
CHAIR:
Can I ask the Clerk to
recall the next set of subheads, please?
CLERK:
1.1.01.
CHAIR:
1.1.01.
Mr.
Kent.
MR. KENT:
Thank you.
I have
a question to ask that relates to, I guess, multiple subheads that we're about
to go through. I'll ask it now and not repeatedly ask it. To try and approach
this efficiently, maybe we can address it off the top and it will probably save
some of my questions as we go through.
Obviously, there's been significant restructuring in the department. I guess, in
order to understand what's happening with this year's budget versus last year's
budget, I'm wondering if the minister can provide clarity as to how the deleted
divisions or budget lines from last year have been absorbed by the current
framework.
There
are a number of headings that were used in 2016 and in previous budgets that are
no longer used in 2017, which makes it really hard to see where the money has
come or gone; for instance, headings that are no longer there that we'd like to
understand where the money is now located, which would then help us understand
what's actually been added or taken away. Policy and Strategic Planning,
Administration Support, Capital, International Business Development, Marketing
and Enterprise Outreach, Investment Portfolio Management, Innovation, Research
and Technology, Sector Development and a number of others that I have more
specific questions on, no longer exist.
I was
wondering, Minister, if you could give us some insight, first of all, which will
probably provide some clarity as we go through this, too. For those topics that
I just mentioned, where do we find those funds now in the 2017 budget?
MR. MITCHELMORE:
I'm certainly prepared to
answer any of your questions on a line-by-line basis. I certainly can address
all of those as we go through the subheads.
MR. KENT:
So you won't provide us with
a breakdown of how that's been moved around?
MR. MITCHELMORE:
You're providing me with a
long list and asking me exactly where they are upfront. I'd prefer we go through
on a line-by-line basis.
MR. KENT:
Okay.
The
challenge is they've disappeared. I will ask line by line, I have no problem
doing that.
MR. MITCHELMORE:
You can provide me with your
list and I will
MR. KENT:
Sure, gladly.
The
Policy and Strategic Planning component of last year's budget is gone. Has it
been wiped out completely or is it moved somewhere else in your department?
MR. MITCHELMORE:
No. The policy aspect would
be under our Corporate Services.
MR. KENT:
Corporate Services. Thank
you.
The
Administrative Support, which I think was Capital, is also gone. Is it now
Current versus Capital? Is that the change?
I'm
sorry; I know I'm not referring to a specific line because they're gone. The
reason why I can't refer to a specific subhead, Mr. Chair, is that they're gone.
They were in last year's; they're not there this year.
MR. MITCHELMORE:
You're talking about the
Administrative Support, Capital, which would be 1.2.03, the $84,000? It may be
more helpful if we went through on a line-by-line basis and you asked your
questions, or else we'll find that we're going to be repeating ourselves.
MR. KENT:
Okay.
What
about International Business Development? Where would that now be located?
Because to ask you the questions related to those topics not knowing where they
now are is really difficult, as I'm sure you can appreciate.
MR. MITCHELMORE:
The internationalization
component of the department now would fall under Growth and Investment.
MR. KENT:
Growth.
Thank
you for your patience. That's exactly what we're trying to understand, is where
these things now reside so we can ask questions appropriately. What about
Marketing and Enterprise Outreach?
MR. MITCHELMORE:
The Marketing and Enterprise
Outreach program, the majority of that had actually moved to the Communications
Division that was listed in The Way
Forward when the update was provided.
MR. KENT:
Okay.
So it's
moved
MR. MITCHELMORE:
There are still some funds,
actually, that would have been associated with our trade shows and different
sponsorships that is a budgetary line. I can relay that when we get to that
particular budgetary line
MR. KENT:
Fair enough.
MR. MITCHELMORE:
because there are several
subheads here.
MR. KENT:
Yeah, I appreciate that.
Once we understand where things have moved, it will allow us to ask the
questions in a more orderly fashion.
Investment Portfolio Management has also vanished. Where would that now be
located?
MR. MITCHELMORE:
That's under Business
Analysis.
MR. KENT:
Would the same be true for
Innovation, Research and Technology?
MR. MITCHELMORE:
Innovation, Research and
Technology?
MR. KENT:
Yeah, there was a heading
used last year called Innovation, Research and Technology which has gone away.
MR. MITCHELMORE:
Well, there are a number of
things that some of these things would have fallen under. Some things are under
Sector Diversification and then some things fall under other portfolios based on
the structure of the department, given that there are three assistant deputy
ministers and that the importance of the process through our management change
was to reduce silos and to best appropriate our programming dollars that we
have.
MR. KENT:
Okay.
Sector
Development is another one that has gone away. Is that now located in another
subhead?
MR. MITCHELMORE:
Sector Diversification is
there as 3.1.01. But as with all of these, there could be components that would
be in other sections as well. It's not as clear to me to say that we just took
what was in
MR. KENT:
Yeah. Right, some have
spread.
MR. MITCHELMORE:
a complete section and
just moved it over in another section. Some things would be HR that would have
been moved, in terms of staffing, to make best fit with that particular branch
now.
MR. KENT:
Right.
MR. MITCHELMORE:
Or some of it would actually
be program dollars that would be moved to a certain area. It's not as simple as
saying this is in here and that's in here. Any question you would have into the
particular running of the department or the line-by-line items, I'm more than
happy to respond to.
MR. KENT:
Okay. Thank you for that.
There
are six others that have disappeared, but I'll hold them and try and address
them in what appears to be the logical subhead.
There's
a chance, Mr. Chair, at the end that we may not have covered them because they
were in last year's, they're not in this year's. I'm hoping we can have a couple
of minutes at the end just in case we don't cover it as we go through, but I'll
save them for the appropriate subhead as best I can, if that's okay.
CHAIR:
Sure.
MR. KENT:
All right.
So I'll
get to specific questions on 1.1.01; the obvious questions first, I guess.
Can you
explain the variance related to Salaries? I realize it's minor.
MR. MITCHELMORE:
There was a decrease of
$19,300 under the budget which was originally scheduled to be $207,100. That
reflects the ministerial salary reduction that was voluntarily voted on in last
year's budget, pay level variance of the EA salary and less vehicle travel cost.
Then
this year's salaries are basically a rightsizing of the salary cost as per the
salary plan of 2017-2018.
MR. KENT:
Okay.
Given
the restructuring that's occurred within the department, would you be able to
provide us with current updated organizational charts, including the branches
and divisions, and give us an overview of the responsibilities now associated
with each?
MR. MITCHELMORE:
Yes, we should be able to
provide you with an updated organizational chart with the position that would be
associated. We can provide that to you when it's available, yes.
MR. KENT:
Okay. Thank you.
How
many people are employed in 2017 in the department versus 2016?
MR. MITCHELMORE:
Well, it's difficult to
state that because we have 420 positions right now in the department. Because
Park Operations were added, that added 114 new positions. There were some
elements such as trade policy and the Marketing Division that was removed. I can
certainly speak to the positions that exist within the department as we go
through and provide you with those details, but there are 420 total positions
for the salary allocations right now for budget 2017-2018.
MR. KENT:
Thank you, Minister.
Would
that 420 include all contractual positions as well?
MR. MITCHELMORE:
Yes.
MR. KENT:
Are temporary positions, the
ones that are often referred to as 13-week positions, are they included as well?
MR. MITCHELMORE:
All temporary positions are
also counted in that.
MR. KENT:
Are there
MR. MITCHELMORE:
They're not necessarily all
13 positions.
MR. KENT:
Right.
Would
you happen to know how many temporary positions there are at present of the 420?
MR. MITCHELMORE:
There are 65 temporary
positions that are allocated as our position complement.
MR. KENT:
Okay.
Would
we be able to get a list of the positions that were eliminated as a result of
the recent restructuring in the department?
MR. MITCHELMORE:
The positions? We should be
able to provide that, yes.
MR. KENT:
Obviously, we're not looking
for people's names; we're just interested in the positions. We're also curious
if the PCNs were actually eliminated or if they've just been parked. With the
positions that were eliminated in the restructuring, have the PCNs gone away or
are they simply remaining on the books for the time being?
MR. MITCHELMORE:
All the positions that were
part of the departmental restructuring would have been eliminated through that
process.
MR. KENT:
Okay.
MR. MITCHELMORE:
There were some new
positions that would have been created based on the organizational structure.
But positions that are no longer there, we had some positions, directors that
were directors that had no staff. So these positions were eliminated.
MR. KENT:
The PCN went away and a new
PCN was created for the new positions. Okay.
I'm out
of time so I'll come back to you again.
CHAIR:
Ms. Rogers.
MS. ROGERS:
Thank you very much.
Going
forward, then, to 1.2.01 Steve, did you finish with 1.1.01?
MR. KENT:
No, I still have questions
on it. I only have maybe one more on 1.1.01.
MS. ROGERS:
Do you want to do that?
CHAIR:
We're on 1.1.01.
MS. ROGERS:
Yeah.
CHAIR:
Yeah.
MR. KENT:
You're ready to move on to
the next one?
MS. ROGERS:
Sure, yeah, if you want to
do that.
MR. KENT:
Mr. Chair, if that's okay,
I'll ask my final question on 1.1.01 and then we can move along.
CHAIR:
Thank you.
MR. KENT:
I'll let Ms. Rogers go first
on 1.2.01.
On the
first subhead, has the 2015 attrition plan been followed within your department
this year? If so, how many positions? Have they been included in your layoff
number?
MR. LOMOND:
Sorry, could you just repeat
the question again? I'm sorry.
MR. KENT:
There was an attrition plan
that was put in place in 2015. I'm wondering if it's still in place and if it
was followed by the department. If so, were there positions that were eliminated
as a result of the attrition plan that was in place previously?
MR. LOMOND:
Yes, we're still following
the attrition plan. I think next year it should be, I believe, the last year of
the attrition plan moving forward. So we have met our attrition requirements for
this year.
MR. KENT:
Okay. They've been included
in any numbers that have been quoted about reductions of positions, those
would be
MR. LOMOND:
They were not reported as part of the reduction or restructuring of management.
No, that was incremental to that.
MR. KENT:
Okay.
Do you
have any idea how many there were this year?
MR. LOMOND:
I'd have to go back and check because the way the savings were achieved in some
cases is through freezing positions. There were six on the books that we've
eliminated that were vacant.
MR. KENT:
Three.
MR. LOMOND:
Six.
MR. KENT:
Oh, six. Sorry, it's been a
long day.
Six,
thank you.
I
thought that was the final question, just one more general Estimates question as
well: Can we obtain a copy of whatever briefing materials that have been
prepared for you for tonight's Estimates?
OFFICIAL:
Okay.
MR. KENT:
Great, thank you.
For the
purpose of Hansard, I see the deputy
nodding yes. Thank you for that.
Thank
you, Mr. Chair.
MS. ROGERS:
Thank you.
1.2.01,
Executive Support; we see a drop in Salaries, a variance in 2016-'17, the
revised and budgeted, a $152,000 reduction. Can someone explain that for us?
MR. MITCHELMORE:
The Salaries line?
MS. ROGERS:
Uh-huh.
MR. MITCHELMORE:
The budget was $1.22 million
basically. The reduction reflects, basically, a reduction in assistant deputy
ministers partially offset by pay scale variances, retirement cost and an ADM
secretary in this particular line.
The
current line 01 of $857,100, which is a significant reduction; the decrease
reflects the rightsizing of the salary cost as per the salary plan for fiscal
2017-2018.
MS. ROGERS:
The reduction of $363,000 is
rightsizing? There are no positions lost there?
MR. MITCHELMORE:
There were reductions in
assistant deputy ministers.
MS. ROGERS:
Yeah.
MR. MITCHELMORE:
There used to be five
assistant deputy ministers in the department. Now there are three.
MS. ROGERS:
Yes, so we lost ADMs,
though, in '16-'17?
MR. MITCHELMORE:
Yes, and the impact
MS. ROGERS:
Okay, and so now in '17-'18?
MR. MITCHELMORE:
Those positions weren't
rehired so the salary savings carried forward.
MS. ROGERS:
Right, so it was only
partial.
MR. MITCHELMORE:
Some of the increase of the
over a million dollars last year was the retirement cost for an ADM secretary as
well. It would be included in that.
MS. ROGERS:
Okay.
In
Transportation and Communications, we see a reduction there under spending in
'16-'17. Do you know how that came about?
MR. MITCHELMORE:
Some of that came about
because of the reduction in assistant deputy ministers. So if you have less
executive support, there would be fewer people who would be travelling.
MS. ROGERS:
Okay.
MR. MITCHELMORE:
We're very happy and very
pleased to see that we've reduced our transportation and our communications
whether it be cellphones and the bills that would be associated from $90,200
all the way down to $66,900 last year. We further anticipate that we can bring
that number down to $65,000 for our executive team. We're going to be as lean as
we can be when it comes to our travel and communications, and do things more
online and connect with people in the most efficient way possible.
MS. ROGERS:
Okay.
I have
no further questions for that section.
MR. KENT:
I have nothing further on
that subhead 1.2.01.
CHAIR:
1.2.02.
MS. ROGERS:
Okay, I'll go to 1.2.02,
Corporate Services. Again, we see a variance there of $37,000 in '16-'17. Can
you just explain that variance, the $37,700?
MR. MITCHELMORE:
Yeah, that's due to delayed
recruitment which was partially offset by the cost of students and retirement
costs of one employee.
MS. ROGERS:
Okay. And then a more
significant reduction of $161,000, almost $162,000 in '17-'18.
MR. MITCHELMORE:
That's the impact basically
through management change where one full director position would have been
covered under this salary as well.
MS. ROGERS:
So that's the elimination of
that position?
MR. MITCHELMORE:
Yes, the concept of bringing
together the Policy and the Information Management Division under one Corporate
Services allowed to have a director and a manager serve in these roles, and
capacity to be able to deliver our Information Management programs and policies
and procedures. It was also a manager in that role as well through the
management structure changes.
MS. ROGERS:
So you went from how many
directors and how many managers to how many you have now?
MR. MITCHELMORE:
There were two directors and
two managers.
MS. ROGERS:
And now?
MR. MITCHELMORE:
Now we have one director and
one manager.
MS. ROGERS:
Okay.
Thank
you.
MR. MITCHELMORE:
If we look at the amount of
legislation and things that the department is responsible for, there are very
few pieces of legislation that the department does in terms of bringing forward
to the House of Assembly and some of the changes that take place from the
Marketing branch. This certainly makes sense to be able to deliver in a more
succinct way our Corporate Services.
MS. ROGERS:
Okay.
If we
did go down to Purchased Services; a reduction in spending in the revised amount
for '16-'17 was $213,000.
MR. MITCHELMORE:
The decrease of $213,000 in
Purchased Services is basically a reduction in our print and advertising
campaigns, reduction in signage work and departmental rebranding delayed during
the fiscal year. That resulted in over $200,000 in savings by being very
responsive to the type of advertising and the type of work that we're doing out
there, when we do particular advertising that it reaches that direct audience
that it's needed to do so.
MS. ROGERS:
And it's advertising for
?
MR. MITCHELMORE:
This could be a focus group;
this could be anything around the brands, like the different signs that we would
have, pop-up banners throughout our various branches or entities. It could be
any number of materials, from a research perspective, that would be a
one-sheeter that would be used for clients. It could be any type of advertising
really.
MS. ROGERS:
Okay.
Then we
see a reduction in the overall budgeted amount for '17-'18.
MR. MITCHELMORE:
Yes.
The
'17-'18, $381,800 is an overall decrease of $134,900. It's a net savings
consisting of re-profiling $100,500 to Executive Council for the restructuring
of Marketing and Communications, a $39,900 reduction in the print advertising
campaign as determined through zero-based budgeting process and a $5,500
increase for forecast adjustments. That would be the breakdown of that process.
Each
division was tasked with finding savings and building its budget from the ground
up. They were able, when they were doing this fiscal year, to find $39,900 in
print advertising savings that did not need to happen.
MS. ROGERS:
Okay. Thank you very much.
Then on
to 1.2.03: $84,000 for Property, Furnishings and Equipment.
MR. MITCHELMORE:
Yeah, last year there was a
cost of capital to replace a vehicle for one of our Regional and Business
Development Branches in the Central office at $30,000. There were also
replacements for generators for the parks operations of $54,000.
Because
we incurred that cost last year we won't be needing to incur this cost this
year. If we look at our inventory fleet, we don't anticipate having to replace a
vehicle. But given that anything can happen to a vehicle, if there's an accident
or whatever the case may be, given where we are, we would have to go through the
Treasury Board process and look at the contingency fund for capital projects of
this nature because we're not budgeting anything in this fiscal year for capital
support.
MS. ROGERS:
Okay. I'm good now for 1.2.
CHAIR:
Thank you.
Mr.
Kent, 1.2.02 and 1.2.03, please.
MR. KENT:
Thank you, Mr. Chair.
I think
just a couple of questions. Minister, under 1.2.02, Corporate Services,
Transportation and Communications; would it be correct to assume that the
reduction relates to the reduction in staff?
MR. MITCHELMORE:
No, the decrease actually
reflects land lines and telephone costs which were actually rightsized to the
related divisions. So you'll see as you go through that some areas may have
increased communication costs.
MR. KENT:
Okay.
MR. MITCHELMORE:
That's primarily because
they were all being billed out through Corporate Services previously.
MR. KENT:
Right, now it's being
divided.
MR. MITCHELMORE:
The user is paying for the
service at this point. That's why you're seeing the significant savings of
communications and transportations in Corporate Services down to $50,300.
MR. KENT:
Okay. That makes sense.
Finally, on Professional Services there's been a significant reduction. I'm just
wondering what happened last year that won't happen this year?
MR. MITCHELMORE:
Professional Services; last
year there was $20,000 expended and we had budgeted $85,500. The $65,500
reflects the cancellation of the retention schedule project and some consulting
work for planning sessions that also wasn't required.
This
year there's a decrease of $80,500. It basically reflects net reductions from
re-profiling of $20,000 to Executive Council for the restructuring of Marketing
and Communications, a $40,600 reduction in projects planned for this fiscal and
a $19,900 reduction through zero-based budgeting.
MR. KENT:
What was the retention
schedule project?
MR. MITCHELMORE:
The retention schedule was
about retaining documentation.
MR. KENT:
Oh, so like a document
management
MR. MITCHELMORE:
Yeah.
MR. KENT:
project of some kind.
Okay.
All
right, I'll leave it there, Mr. Chair.
CHAIR:
Okay.
Mr.
Kent, I'm going to ask you to start off the questioning on 2.1.01 and 2.1.02.
MR. KENT:
Thank you.
Sorry,
Mr. Chair, do we need to vote on
CHAIR:
No, we're going to do it
MR. KENT:
We're going to do that at
the end.
CHAIR:
We're going to do it
inclusively.
MR. KENT:
Okay, great.
Thank
you.
2.1.01,
Accelerated Growth; Minister, could you start by explaining the variance related
to Salaries.
MR. MITCHELMORE:
Well, there's a decrease in
$27,800 reflects savings from delayed recruitment. That would have been the
changes last year. This year, the decrease reflects rightsizing of salary costs
as per the salary plan in 2017-18, and I want to state that this is where the
former International Business and innovation and oceans branch, a portion of it
would be found.
MR. KENT:
What do you mean by
rightsizing the salary plan? What do you mean when you say that?
MR. MITCHELMORE:
That the salary plan fits
the number of positions that are currently allocated to that division. That
there isn't an unfunded position there or there isn't something that doesn't fit
with the overall plan for that division; that all the salary dollars are
accounted for, whereas that hasn't always been the case.
MR. KENT:
Okay, thank you for that.
Professional Services in the revised 2016-2017 budget, a significant amount of
money was removed and now it's been put back in. Can you just explain what's
going on under Professional Services?
MR. MITCHELMORE:
Yes. The decrease in
$186,700 reflects the cancellation of supplier development mining capacity
building study and reduction in legal costs for client files under the
commercialization and the innovation strategy.
This
year, there's actually an increase of $900. That reflects the funding identified
through the budgetary process to look at all the initiatives that we need to do
this year; when we look at the supplier development, that's really key.
We just
advanced a new procurement act here in the province through GPA, the minister
did. We all debated that. As well, the Premier announced the Canadian Free Trade
Agreement, where I was in Toronto and signed the document with my colleagues.
From a Canadian context, there are a lot of opportunities for local businesses
to bid from a Canadian perspective.
Then we
have CETA as well, to look at supplier development, to capitalize on the
European marketplace. So it makes sense to focus our efforts where we can get
greatest returns. We will be focusing on procurement, whether it be at the
local, national or international level when we talk about the new dollars that
are associated with the budget.
We've
actually seen through the Research & Development Corporation, through the
Department of Natural Resources, and the activities and investments that have
happened around mining and new initiatives, that this actually makes sense. This
would be best use of dollars right now going forward when it comes to looking at
our Professional Services.
MR. KENT:
So have any contracts been
awarded, or have any consultants been engaged to spend that $188,000?
MR. MITCHELMORE:
When it comes to certain
initiatives, we partner with Canadian Manufacturers & Exporters. We are talking
to a number of entities that we would look for when it comes to accelerated
growth. We can provide a list of consultants that would have been engaged in
last year's budgetary process. Now, there was only $900 in fees associated.
I don't
believe we've entered into any particular contract in this budgetary cycle
within the last 30 days, but if there is my staff can certainly correct me.
MR. KENT:
No, okay.
Related
to Purchased Services, there's been a major reduction over last year's. It was
revised and now it's down over $300,000 from last year's budget. Would you be
able to comment on that?
MR. MITCHELMORE:
Yes. Last year we saw a
reduction of $177,600 and that comes from less expenditures pertaining to
meeting costs, equipment rentals, other purchased services. We did less trade
missions attended than we anticipated which resulted in less logistical cost.
In
terms of this year, the decrease reflects a reduction in the number of trade
shows and missions hosted next fiscal, a reduction in logistical cost, meeting
requirements, and promotional materials as determined through zero-based
budgeting and other adjustments.
We also
anticipate that we have greater opportunity through our international
agreements, whether it be through the IBDA or others, to do greater leverage
where if we do missions through an Atlantic Canadian perspective we can reduce
our costs significantly. Whereas in the past, I guess previously to me coming
into this portfolio, there have been a number of cases where the department has
used 100 per cent dollars from the province to fund trade missions. We believe
in greater federal leverage and we will use it to the full advantage to save the
taxpayers of Newfoundland and Labrador more.
MR. KENT:
I think that's all I need to
know on Purchased Services.
Related
to Grants and Subsidies, would we be able to get a breakdown of what's included
in Grants and Subsidies?
MR. MITCHELMORE:
Well, the Grants and
Subsidies, the reduction of $121,600 is really the number of trade missions
selected and attendance was reduced. This year we're going to see a decrease,
which is just of $2,300, based on what was budgeted last year. That's the
reduction in IBDA and in marketing mission logistics to support our fiscal year,
but we can certainly provide a breakdown of what those Grants and Subsides are,
yes.
MR. KENT:
That would be greatly
appreciated. Thank you.
Where
is broadband now budgeted in the new department structure?
MR. MITCHELMORE:
Broadband is under our
comprehensive Economic Development Programs through the Regional Development
Fund, I believe.
The
question you asked me in the House of Assembly, I was correct in stating that
the $1.227 million was the sun-setting of the former committed projects under
the rural broadband that was carried over and have now basically been completed
through last fiscal.
MR. KENT:
I'll save my next question
on broadband until we get to that section then.
I don't
know if this is the appropriate place to ask the question or not but it feels
like it might fit here in light of the conversation we just had around Purchased
and Professional Services and what goes on in this new accelerated growth area.
In
terms of CETA, can you comment on what the province received in return for
giving up minimum processing requirements?
MR. MITCHELMORE:
The CETA fund in particular
you look at the benefits of the Canadian Economic and Trade Agreement with
Europe, there are tremendous tariff removals; there are benefits to Canadian
business. Right now, minimum processing requirements are not removed when CETA
comes into force until a period of three years and they are only for the
European Union. Minimum processing requirements still exist in the Canadian
context and internationally anywhere else you ship products.
You may
be best to ask Minister Crocker around minimum processing requirements, as they
are a fisheries policy, and the trade policy falls under Executive Council and
not in the Department of Tourism, Culture, Industry and Innovation. We are
focused on the implementation of CETA, which benefits local businesses, and
that's what I had talked about around supplier development.
So your
question around the actual minimum processing requirements would be best
directed toward Minister Crocker, who's responsible in that portfolio, and from
a trade policy point of view would be in Executive Council.
MR. KENT:
Thank you. So just a quick
comment on that and I'll ask one more question and then move on to the next
section, and my colleague can ask her questions.
Regarding MPRs, you list some of the CETA benefits, but those benefits apply to
all provinces. We're the only province that had to give up MPRs; hence my
question. Nonetheless, we can deal with it in the House and with the Fisheries
Minister as well. Where is the Ocean Technology and Arctic Opportunities
division funding? What was that division? Where is that now located in the
department's budget?
MR. MITCHELMORE:
Some of those aspects would
be covered under the Accelerated Growth. We see ocean technology as a very
important sector when it comes to opportunities in Newfoundland and Labrador. We
have several hundred companies that deal in that particular space. A lot of them
scale up; have hired a number of young talent.
If you
look at from a point of view of accelerated growth, you look at
internationalization and export and what they're looking for, a number of ocean
technology aspects would fit really well under the Accelerated Growth. That's
where our staff and our team of people are there to support those particular
initiatives, whether it be the MOU with Nunavut and I've been meeting
regularly with my colleagues and having discussions on Nunavut and all the
opportunities that exist within that particular jurisdiction.
We're
very open to continuing to have those dialogues. We've been having significant
dialogues with other jurisdictions as well around the oceans. Like Ireland I
just met with the ambassador of Ireland, given their continental shelf and the
connection to the fisheries and marine institutes on both sides of the ocean.
Through research and development, there's a lot of connectivity with the oceans,
as I talked about earlier. So we're supporting the oceans quite significantly
and the tech sector too.
MR. KENT:
Okay.
Mr.
Chair, just a follow-up question related to the ocean technology question, and
then I am happy to move along. So in light of that explanation, can you tell us
what position is now in charge of Ocean Technology and Arctic Opportunities in
your new structure? And also, 2015 there was over $659,000 budgeted in that
area, last year it was down to $472,800, how much this year because it's no
longer obvious? So who's now in charge and how much is budgeted for this year?
MR. MITCHELMORE:
Last year was primarily a
change in the reduction in assistant deputy ministers that would have come out
of the Ocean Technology Sector, the difference, the variance I would think I'm
not looking at the numbers you're looking at
MR. KENT:
Yeah.
MR. MITCHELMORE:
But in terms of the
responsibility, there is a team of people that deal with the sectors, that deal
with ocean technology and the supports. Depending on which particular client and
what they're looking for, one of the primary touch points would be in
Accelerated Growth, which would fall under our Business division.
So
primarily it would be the assistant deputy minister of business.
MR. KENT:
Can you comment on the
budget for this year related to Ocean Technology and Arctic Opportunities?
MR. MITCHELMORE:
Well, the budget for the
department is quite extensive. There's over $100 million to support economic
development and diversification
MR. KENT:
Overall, sure.
MR. MITCHELMORE:
in Newfoundland and
Labrador. If you look at all of the supports that are available to ocean
technology companies, I would state that the support that was available
previously, there is equivalent or more support available now to companies that
deal in that ocean technology space. Whether we look at the Research &
Development Corporation, we look at our international programs, we look at our
business development support, we look at the sector programs that exist, the
research capacity and the team approach to better utilize some of our programs
through our Business Investment Corporation and other entities.
So to
think that we're doing anything less for oceans, I would say that's completely
not the case, if that's what you're insinuating.
MR. KENT:
I'm not insinuating
anything. There's a $472,000 budget that's disappeared. So if you can give us a
breakdown of where those funds are and give us a commitment on how much money is
being spent in that sector this year that would be greatly appreciated. But your
answer suggests that those funds are specifically allocated for Ocean Technology
and Arctic Opportunities.
MR. MITCHELMORE:
There are significant
resources within our Department of TCII to support the Ocean Tech Sector and
there are staff that support that sector, and will continue to do so.
CHAIR:
I'm going to have to stop it
there.
Ms.
Rogers, 2.1.01 and 2.1.02.
MS. ROGERS:
Thank you very much.
If we
go back to Professional Services, $187,600 I don't know if you already
mentioned this, but why is it that work wasn't done?
MR. MITCHELMORE:
We decided we would cancel
the supplier development mining capacity building study and we reduced our legal
costs for client files under the commercialization and innovation strategy.
Given
all of the negotiations that were taking place with the Canadian Free Trade
Agreement, the Canada-European Comprehensive Economic and Trade Agreement and
the new procurement act, that it would be best to focus our supplier developer
efforts where we would get the greatest leverage. That is why we've increased
the budget by $900 to focus where we're going to get best value from an economic
point of view through accelerated growth.
We've
already seen significant investments in mining and different work through the
Research & Development Corporation and also investments through Natural
Resources and what they do to support mining activity. Given the growth in
mining that's taken place already on the Baie Verte Peninsula, different changes
that has happened around Lab West, Voisey's Bay and in other areas of the
province, we feel that earmarking these funds is the right approach to help
expedite and accelerate growth in Newfoundland and Labrador.
MS. ROGERS:
So the $188,000 is different
work that would have been covered by the $187,000.
MR. LOMOND:
I think the numbers are a little bit misleading.
As the
minister said with CETA and CFTA, the department refocused. The trade policy
division has been moved over to Intergovernmental Affairs. So when you look at
the Intergovernmental Affairs budget, you'll see $120,000 allocated under
Professional Services for legal costs. They also took $240,000 in expenses that
were paid by our department. So I think that might be part of the confusion;
$900 to $187,000 looks like a fairly big jump, but the department would have
paid $240,000 in legal expenses around the CETA agreements, but those expenses
are showing up under IGA where our department went through a fairly significant
restructuring.
MS. ROGERS:
I was asking about the
Professional Services line.
MR. LOMOND:
Right. Professional Services, so those legal fees that you would see a variance
of $900 showing up in 2016-2017, there was actually $240,000 additional to that,
and that $240,000 is reflected in the Intergovernmental Affairs budget because
they now host trade policy. Trade policy used the rest with our department up
until the restructuring.
The
numbers may look a little bit misleading. It looks like a fairly significant
drop, but there was actually that much money and more spent.
MS. ROGERS:
Okay.
When we
go down into Purchased Services from $412,000, then to $234,000 and now to
$111,000 I know we've covered that with Steve Kent, but can you just for an
area that's accelerated growth, we see a lot of reductions and one would think
that we might go in the opposite direction. If you could just give me a bit of
an overview as to why it seems to be diminishing.
MR. LOMOND:
Some of that money would have been for things like trade booths at exhibits and
floor space, those sorts of things.
MS. ROGERS:
Yes, right.
MR. LOMOND:
Under the Atlantic Growth Strategy we've entered into an arrangement with other
provinces, and we have increased the size of the funding pot that's available
through that arrangement. So activities, as the minister mentioned, that we
would have been paying 100-cent dollars for
MS. ROGERS:
Yes.
MR. LOMOND:
we're now paying five-cent dollars for, because it's our share of the
agreement
MS. ROGERS:
Because you're co-operating
together.
MR. LOMOND:
Right, it costs about 5 per cent.
So we
would be sharing activities. Sometimes our department might lead; sometimes it
might be a local industry association. Sometimes it might be a group in Nova
Scotia or ESANS. Some environmental group could be leading in another province
and we would participate, but our share is much smaller.
MS. ROGERS:
Okay.
Thank
you.
CHAIR:
2.2.01 and 2.
MR. KENT:
Sorry, Mr. Chair, I have
questions on 2.1.02.
MS. ROGERS:
Yes, and so did I.
CHAIR:
Okay. I thought I had those
inclusive, but
MR. KENT:
You did, but I haven't
spoken to that one.
CHAIR:
Okay.
Go
ahead, Mr. Kent.
MS. ROGERS:
Can we have a list of all
the loans, advances and investments made in 2.1.02?
MR. MITCHELMORE:
Anything we can provide
that's not commercially sensitive we can certainly provide under 2.1.02.
Some of
the funding would have been I talked about previously, is around our Venture
Capital funding, would be provided here, our Made in Newfoundland and Labrador
Fund, and the Atlantic Canada Venture Capital Fund as to what would be provided.
Then there would be some funds associated with particular clients that would be
involved through investment attraction. There were some public announcements
made on a couple of those in particular.
MS. ROGERS:
Okay.
Also,
is there a specific direction that this program is going in? Are there specific
areas that you are focusing on?
MR. MITCHELMORE:
There are always components
that you're looking at, whether it's export or if there's a way of bringing in
inward investment here. There are a numbers of areas of criteria where there are
sectors that are growing in our economy. So there are some areas where you'd
want to target an investment in particular to have a positive impact to the
economy, and that's the focus of this $8 million.
MS. ROGERS:
Yeah. So my question was
because I know that.
MR. MITCHELMORE:
Yes.
MS. ROGERS:
My question was: What are
those for the department?
MR. MITCHELMORE:
So they could be, in
particular, technology companies. They could be those that would deal in life
science; those that would deal in innovation. It could be aerospace; it could be
any sector really in the economy that could show a potential for growth, really.
That's the strategic direction.
There
really isn't a hard limitation as to what would not quantify as an investment,
if it makes sense.
MS. ROGERS:
Right. So I guess my
question is: In terms of where we are in the province right now and what we know
to be true for the province right now and what we know to be true happening
globally, are there particular areas of interest for the province right now in
terms of we all know innovation, et cetera, but are there areas that are
targeted or that the province, in terms of your plans, what areas are you going
and what areas do you feel are real possible growth areas for the province?
MR. MITCHELMORE:
Yes, I think if you wanted
to take some time to review some of the 50 initiatives in
The Way Forward document, it clearly
outlines some of the sectors of the economy that we will be focusing on and some
of them would be looking at innovation, looking at the Technology sector, but
also looking at some of the traditional sectors as well.
If you
look at some of the initiatives that the department is doing such as the
Regional Innovation Systems pilots where we're focusing on ocean tech for the
Avalon Peninsula, we're focusing on industrial activity when it comes to the
Clarenville-Burin Peninsula, we're focusing on defence and aerospace when it
comes to the Central part of Newfoundland and Labrador and then, as well, we
have agriculture and forestry in the Corner Brook and area and then tourism and
fisheries systems pilots when it comes to Southern Labrador and the Northern
Peninsula. So you're looking at strength in regions and you're looking at
opportunities.
When
the team looks at investment attraction, whether they're on a trade mission or
whether they're working with embassies or working with the export development
corporation or just advancing a business lead, they follow a process and do due
diligence to try and find the greatest opportunities that can benefit
Newfoundland and Labrador; whether that's in the form of high-value jobs or
significant investment in capital in the economy for the longer term to develop
and grow industries.
We've
seen some really positive investments from this particular fund in the past. I
can highlight an example like Verafin which would be a company that has really
grown to about 300 employees that would have been a beneficiary of investment
attraction.
MS. ROGERS:
Thank you.
CHAIR:
Mr. Kent.
MR. KENT:
Thank you.
Minister, is there any money allocated through the Investment Attraction Fund
for NewGreen Technology in the proposed $185 million bio-fuel plant to be built
in Botwood?
MR. MITCHELMORE:
The Cleantech sector is an
interesting area. We're seeing from the Canadian contacts through infrastructure
or other initiatives that there's a direction to look at being more
environmentally friendly, to be looking at clean technology, to be looking at
different types of initiatives. But in terms of any particular investment I'm
not aware of any earmarking of this $8 million for the particular project that
you have mentioned.
MR. KENT:
So just to be clear, you're
not aware of any funds being allocated for NewGreen Technology at this point?
MR. MITCHELMORE:
You had stated a number of
$180 million for a particular company. Any company that would like to see
investment from the department, in particular to receive public funds, would
have to submit a business plan, would have to submit documentations, go through
a due diligence process, our business analysis division would be involved in
that role and provide documentation on any particular case a client would be
putting forward.
In last
year's budget, we had talked about a particular investment which was a strategic
investment. At that time, we had removed the dollars from strategic investments.
I made the statement that if there was an investment that exceeded funds
allocated then there would be a process to go through Treasury Board, basically,
through the contingency fund mechanism to look at economic opportunities.
MR. KENT:
So has NewGreen Technology
applied for funding and what stage of the process if the project at?
MR. MITCHELMORE:
Do you want to answer that?
MR. LOMOND:
There's no active
application as such. The company has written to basically feel out the programs
that we might have, but there's no active application at this point and time.
MR. KENT:
Okay. At this point, there's
no commitment from the province to invest in the project?
MR. LOMOND:
We would require a full
business plan. We would have to subject it to due diligence, full financial
review. No, we're not there.
MR. KENT:
Okay.
I'll
leave it there for 2.1.02.
CHAIR:
Okay, Mr. Kent, we'll ask
you to start again now on 2.2.01 and 2.2.02.
MR. KENT:
Okay.
On
2.2.01, Minister, the variances related to Salaries and Purchased Services are
relatively minor, but I was just wondering if you could make a quick comment on
both.
MR. MITCHELMORE:
It's basically a change in
one director and one new manager was added. It's a small change but it's a
reduction in a director position but the addition of a manager position.
MR. KENT:
Okay.
Under
the same heading, in estimates 2016, Salaries were $741,000 I believe. You did
mention earlier that investment portfolio management has moved into this area.
Is there anything else that explains that difference? Is it just the
consolidation of those two areas, so to speak, or are there other areas of the
department that have now been rolled in to Business Analysis?
MR. LOMOND:
No, I think those are the
two pieces. There is also a new element as outlined in
The Way Forward the major projects
unit is reflected in that, but that's basically been done through re-profiling
of existing positions to put some focus on that.
MR. KENT:
Right. Okay, thank you.
The
Grants and Subsidies number is over $4 million. Would we be able to receive a
breakdown of those grants and subsidies and who receives them?
MR. MITCHELMORE:
The Grants and Subsidies are
basically our Business Development Support Program. If they can be made
available, we'll certainly make them available, if there's nothing commercially
sensitive about them. I'm sure we can provide a list and the dollar values.
MR. KENT:
Okay, great. Thank you.
So, Mr.
Chair, I'll ask my couple of questions on 2.2.02 as well. You called them both,
correct?
CHAIR:
Yes.
MR. KENT:
Okay.
Can you
explain the $17 million in the revised Estimates for 2016 under Loans, Advances
and Investments, and tell us who received those funds?
MR. MITCHELMORE:
Well, as we discussed last
year under this Strategic Enterprise Development program of capital, $17 million
reflects a loan to Canada Fluorspar Inc. The loan was approved by Treasury Board
to support the St. Lawrence fluorspar mine and milling operation project.
Given
we didn't have a budget for that, that would have been approved through the
contingency. Given that there's $637,400 in revenue, this would have been
payment from a previous loan that would have been provided. That would have been
for $17 million. That would have been for a wharf.
MR. KENT:
Okay.
My
final question on 2.2.02: Could you comment on government's investment in
Venture Capital and how it compares to last year?
MR. MITCHELMORE:
Well, the investment under
Venture Capital would have fallen under 2.1.02 under our Investment Attraction
Fund.
MR. KENT:
Okay, yes.
MR. MITCHELMORE:
The Made in Newfoundland and
Labrador Fund, the total for 2017-2018 that's being anticipated is a total of
$5.1 million.
MR. KENT:
How does that compare to
last year, Minister?
MR. MITCHELMORE:
The remaining disbursements
that would have been in both funds well, the amount that would have been
provided last year for remaining disbursement would have been $4.9 million total
in 2016-2017 that would have been expected in the funds. The funds are adding, I
guess, as there are investors, providing private equity. People like the BDC
Capital and others would be adding to create basically two $10 million funds for
a total of $20 million.
MR. KENT:
Okay.
Sorry,
you mentioned that the Major Projects unit now falls in one of these areas. Has
there been any progress with that at this point that you could share with us?
MR. MITCHELMORE:
The Major Projects unit
falls under Business Analysis, and that's a good fit for this division because
of the research, development, coordination, administration, everything that gets
assessed from a diligence point of view. We'll provide that one window, that
entry point, to provide a better connectivity to our experts within our
horizontal department, reduce barriers and improve the timeline when it comes to
dealing with clients.
We've
published our service standards already on our website as part of
The Way Forward initiative. There
have been some meetings with potential clients to look at potential investment
in the project, and they'll continue to do their work. We encourage people if
they have a major project or anybody who is interested in making significant
investment into the province to reach out to the manager of Major Projects.
MR. KENT:
Okay. I'll leave it there
for that subhead, Mr. Chair.
CHAIR:
Ms. Rogers, 2.2.01 and
2.2.02.
MS. ROGERS:
I'm quite content, thank
you, Mr. Chair. My colleague has a done an exemplary job.
CHAIR:
Okay.
Ms.
Rogers, I'll get to start off then on 3.1.01.
MS. ROGERS:
Thank you very much.
3.1.01,
Sector Diversification, so if we go to Salaries we see a variance there from the
revised amount, a reduction of $205,800
MR. MITCHELMORE:
The Salaries?
MS. ROGERS:
Yes, Sir.
MR. MITCHELMORE:
The decrease of $205,000
reflects savings due to delayed recruitment, and the decrease this year reflects
the changes as per the salary plan of bringing in, I guess, some of the
divisions and changes that happened in the department.
MS. ROGERS:
So how many positions would
that be; and if it's a reorganization of the department, are those positions
gone or have they moved somewhere else?
MR. MITCHELMORE:
In Sector Diversification,
we have total of 33 positions.
MS. ROGERS:
33 positions lost?
MR. MITCHELMORE:
No, that's the total
positions that are currently in Sector Diversification that account for the
$1,615,200 in Salaries. There are 21 permanent employees and 12 temporary.
MS. ROGERS:
So the reduction of $545,000
reflects the loss of how many positions?
MR. LOMOND:
Just so you're clear, when
you look back at Accelerated Growth, the heading we looked at some time ago
MS. ROGERS:
Yes.
MR. LOMOND:
that one covers the firm
facing elements of the various divisions, so actually working with companies.
This particular activity looks at the ecosystem. So things like clusters, your
incubators, your accelerators. The positions are all reflected here, the savings
are reflected here but a little bit of those duties could actually be attributed
back to Accelerated Growth but where we went through such a substantive
basically, we eliminated across those two activities four director positions, a
manager and two senior policy positions, and then created a new director and a
new manager.
MS. ROGERS:
Okay. Four directors and how
many managers?
MR. LOMOND:
One manager
MS. ROGERS:
Yes.
MR. LOMOND:
and two senior policy
analysts. So those are basically non-bargaining unit positions but who wouldn't
have had direct reports.
MS. ROGERS:
And did those positions
disappear entirely or have they been moved elsewhere?
MR. LOMOND:
Those positions have been
merged
MS. ROGERS:
Eliminated?
MR. LOMOND:
Eliminated and are reflected
either in this activity or in the Accelerated Growth.
MS. ROGERS:
Okay.
I'll
ask it a different way. I just want to get a handle on so we've lost four
directors. Of those four directors, did any of them go into another area?
MR. MITCHELMORE:
No.
MS. ROGERS:
No. So those have been
eliminated. One manager
MR. LOMOND:
I'm sorry.
MS. ROGERS:
And so the two policy
analysts
MR. LOMOND:
Yes.
MS. ROGERS:
So those positions have been
eliminated altogether. It's not somebody has moved to Accelerated Growth.
MR. LOMOND:
Right. Now that doesn't
necessarily mean the person is out of work because in some cases people might
have had a bargaining unit position and might have been acting in a senior
policy analyst. So they might have bumped back into the
MS. ROGERS:
Yes, but the positions of
the policy analyst, those jobs, those two are gone.
MR. LOMOND:
That's correct.
MS. ROGERS:
They weren't moved, like, to
Accelerated Growth.
Okay;
all right. Thank you. That clarification, that's helpful. Thank you very much.
A small
amount here, Employee Benefits, that would reflect in the movements.
Transportation and Communications; we see a reduction of $45,000 in the revised
amount for '16-'17 and then a reduction once again in '17-'18.
MR. MITCHELMORE:
Yes.
The
decrease of $45,000 reflected the participation in and travel to
non-discretionary trade shows. So there was a reduction there. There was some
travel reduced for trade shows again this year through the zero-based budgeting
process. There was a reduction in telephone lines and travel for staff to bring
that number down to $12,600 this year, given that this is a merge of a couple of
former divisions as well.
MS. ROGERS:
In Professional Services, in
the revised, it's a reduction of $17,000. What kinds of professional services
would you have engaged and then not engaged?
MR. MITCHELMORE:
Professional services
typically would have been the hiring of a consultant or any research costs that
would have been attributed to a particular year. The decrease this year reflects
the funding required for research studies for this upcoming fiscal year.
MS. ROGERS:
Okay. Thank you.
Grants
and Subsidies; we see a huge change in that. Can you explain that, please?
MR. MITCHELMORE:
Yeah, the decrease is the
conclusion of the Rural Broadband project, as I talked about earlier when Mr.
Kent had asked about broadband. There was $1,277,500 partially offset by some
re-profiled funds for the industry associations related to craft and trade
shows. That's where the overall decrease is, $1,187,500
We
still have funds in the broadband project. This would have been funds that were
previously committed that didn't get complete that were basically rolled over.
That program is now concluded and the funds have 'sunsetted' because the
projects have.
MS. ROGERS:
Are there still areas of the
province that do not have broadband?
MR. MITCHELMORE:
We have 99 per cent
coverage, basically, right now.
MS. ROGERS:
That's pretty good.
MR. MITCHELMORE:
There is a program with the
federal government, through Connecting Canadians, for a $500 million program,
which we will use the $2 million that we had allocated over two years to help
leverage and work with the private sector providers to improve broadband
services.
There
are some areas of the province that have broadband that have congestion issues.
We continue to work to find the most cost-effective means with providers to
ensure that they're upgrading their services and that broadband capacity is as
diverse as can be. Last year, we supported funds for 16 new communities across
the province to either see broadband for the first time or have enhanced
services.
MS. ROGERS:
Okay, great.
Go
ahead, Mr. Kent.
MR. KENT:
Thank you.
Ms.
Rogers did an exemplary job of asking some of the questions that I had planned
to ask, but I still have a few more.
Just to
pick up on the rural broadband. Minister, are there any funds this year
specifically allocated for rural broadband?
MR. MITCHELMORE:
Yes. In last year's budget
there was a total of $2 million over two years. So we have funds that can be
earmarked through our Regional Development Program, I believe, if I look
forward. Is it the regional diversification fund?
OFFICIAL:
Comprehensive Economic
Development.
MR. MITCHELMORE:
Comprehensive Economic
Development, if we go to 3.3.01, the $10,360,600; there are funds allocated in
this program here for broadband.
MR. KENT:
Okay.
That
was $2 million over two years?
MR. MITCHELMORE:
Yes.
MR. KENT:
Okay. Thank you.
Would
it be possible to get a list of those communities that still do not have
broadband? I recognize we've got really good coverage, but there are still a
number of communities that are in that 1 per cent.
MR. MITCHELMORE:
Yeah, it's somewhat
difficult, I guess, to identify what you would deem as a community for broadband
in terms of the pure definition of an actual community. Some of the information
would be company driven or company specific.
Our
department has no issue with releasing any information that we have available.
We actually released information and one of the providers took issue with
releasing some of the information, deeming it as confidential in nature. That
went through the Information Commissioner to make a ruling.
Any
information that can be provided to look at communities that don't have
broadband access, it all depends on what's deemed as coverage. There are
communities that have a fibre connection or DSL; there are communities that have
it through wireless. There are communities that have satellite internet that
would have the definition of broadband. There are a number of entities as to say
which communities.
Ninety-nine per cent of the population is covered through a broadband service in
terms of geographical community of which they live, but there are congestion
issues that exist within communities where people are not getting the true speed
of a minimum of 1.5 megabits per second. This is where, through the $500 million
federal program, through Connecting Canadians, we anticipate that we can improve
by working with the providers, the backbones that exist, that enhancements can
be made and there can be significant investments made into communities to grow
broadband Internet.
This
was a program the former federal government had offered as well, over $225
million for broadband, and the former provincial government got zero dollars and
put forward zero proposals to enhance broadband and used 100 per cent of the
taxpayers' dollars to put forward broadband initiatives instead of leverage.
MR. KENT:
Well, Minister, the former
administration increased the coverage dramatically and got it up to 98 per cent.
MR. MITCHELMORE:
All at the cost of the
Newfoundland taxpayers.
MR. KENT:
I haven't cut you off, so
maybe you shouldn't cut me off.
The
former administration increased broadband coverage rather significantly, up to
98 per cent. Under whatever definition the department is currently using and I
imagine it's the same definition we were using we know where the 99 per cent
of the population is that has coverage. So we know the areas, however you wish
to define them, where there isn't coverage today, by your own definition of the
99 versus the 1 per cent.
If you
can tell us by geographic area or by municipalities and local service districts
the problem with that approach is it doesn't include the unincorporated areas,
but some kind of breakdown would be appreciated because you do know, the
department does know what areas of the province are not covered and what
communities, whether they're unincorporated areas, local service districts or
municipalities, the department does know what those communities are, and all
we're asking for is a list.
MR. MITCHELMORE:
There are some, I guess, as
to what you would determine as a community because there are cabin areas, there
are places that would not meet the definition of a community. So to be able to
provide a comprehensive list of the communities throughout Newfoundland and
Labrador you look at municipalities; you look at the local service districts.
It's certainly a much easier process to provide a list if the community has a
definition of high-speed Internet or not and what form.
When
you start getting in to unincorporated communities and determining which ones
are actually deemed communities, in terms of, is it a cabin area? Does somebody
determine that because they pay fees for garbage collection or whatnot, whether
it be Ocean Pond, for example, to determine that broadband Internet must be
supplied within all areas of the province, then you could look at the fact that
satellite coverage would ensure that there is significant access to very
isolated and rural and remote areas through a satellite service, that they would
meet the definition of having broadband Internet.
MR. KENT:
I'm sorry, Minister, but I
have trouble accepting that explanation. I don't know why you wouldn't be
forthcoming with the information that the department has, in whatever form. Give
us a map. Give us a list of geographic areas. Give us postal codes. Give us a
list of roads. Give us a list of towns and local service districts. Leave out
some of the unincorporated areas, if you must. But I know for a fact that the
department knows. I have trouble with your explanation here this evening.
So why
won't you provide it? Why the hesitation in providing that information?
MR. MITCHELMORE:
When it comes to broadband
Internet services, we will continue to work towards having ubiquitous coverage
across the province and finding a way to close the gap for the 1 per cent.
MR. KENT:
So for someone who's
expressed passion around this issue in the past, your response tonight is both
troubling and surprising, because the department has the information. And you're
basically now on record in Estimates in this Chamber saying you won't provide
the information.
Given
the progress that's been made, given your government's continued commitment to
making more progress, I just don't understand why you wouldn't be transparent.
I'm clearing missing something.
MR. MITCHELMORE:
We have no issue with
identifying where broadband Internet exists. The providers provide that
information as well on their website. They provide a list of the communities
that they service, whether it would be any of the large telecommunication
provides or whether it would be the small-scale companies.
There
are people who are providing microcell and wireless solutions that are covering
communities. It is not government, the Province of Newfoundland and Labrador,
that is responsible for the installation or providing the service of broadband
Internet. It's a highly regulated area within a federal jurisdiction under the
confines of the CRTC.
In
terms of government having any inventory of every single community and map and
whatnot of which broadband exists, for you to state that we have all of this,
this inventory, I don't believe that's the case.
MR. KENT:
Well, just provide us with
what you have then. I understand the complexities. I do understand and accept
the complexities, but you have data. You do have some understanding of areas of
the province that aren't covered and we're simply asking for you to share that
information, which I presume has been shared in the past.
There's
been progress made. There are still gaps. I understand there's an effort being
made to address them. So in whatever form, to whatever extent you have it, to
whatever extend you can, all we're asking is that you provide the information.
MR. MITCHELMORE:
And if there are no
commercial sensitivities with providing those details based on the contracts
that have been entered into with providers, we will provide documentation around
a list of communities that have broadband Internet here in the province. It may
require us to do a bit of work to be able to provide that information.
I
personally don't have a document that I've seen that lists every single
community in the province that has access to broadband and a list of ones that
do not.
MR. KENT:
So I'm out of time, but I do
have more questions.
CHAIR:
Okay.
Well,
I'm just going to ask that we recess for probably five to seven minutes, just to
give our personnel at the media centre downstairs an opportunity for a break as
well. So we'll reconvene probably at 10 or 12 minutes after, please.
Recess
CHAIR:
Okay, welcome back. We're
ready to reconvene our session with 3.2.01.
Ms.
Rogers.
MS. ROGERS:
Yes, Sir.
Regional Economic Development, Salaries thank you very much, 3.2.01, Regional
Economic and Business Development. We see a significant reduction in the revised
amount, in the budget amount of $230,000, and then an even more significant
reduction by almost $500,000 for 2017. Maybe someone could explain that?
Thank
you.
MR. MITCHELMORE:
The $230,900 is delayed
recruitment, partially offset by sick leave replacement costs and temporary GRI
seconded position cost absorbed by the department. In this year's budget there's
basically one director versus six directors. Then there were four managers
added, which is the adjustment primarily for those salary changes.
MS. ROGERS:
Okay, so the elimination of
five directors for this specific department, this specific program. The delayed
recruitment; we've had a lot of delayed recruitments. Why were there so many
delayed recruitments?
MR. MITCHELMORE:
There was basically a
process of which only essential positions that were needed would be hired based
on last year's fiscal situation. We did recruit a position in this particular
area, in particular, in Lab West, given that the only economic development
officer had left the position. Given what was going on around Wabush Mines,
around the downturn in iron ore prices and the impact, it was highly pertinent
that we would actually recruit for that particular position.
Not in
all cases did we delay hiring, but we have changed the director positions. We
used to have, basically, five regional directors for each area. Those positions
and the territories have been changed to be served through regional managers
instead.
MS. ROGERS:
Thank you.
Transportation and Communications; I imagine Regional Economic and Business
Development, which is something we so desperately need in order to create
sustainable employment and activities across the province, of the four managers
that were added, are there other managers as well? Were there any reductions in
managers?
We know
there was a reduction of five directors, they're gone and four managers added.
We went from six staff positions to five staff positions. Are some of the
managers, were they former directors?
MR. MITCHELMORE:
Yes.
MS. ROGERS:
Yes.
MR. MITCHELMORE:
Yes.
MS. ROGERS:
Okay.
Transportation and Communications; we see in the revised a reduction of
$136,000. That's kind of significant there, if someone could speak to that.
MR. MITCHELMORE:
Less travel based on whether
vacancies some of the industry events were held locally. There was a real push
to use teleconferencing capabilities with clients. We held sessions where we
reached out to our Regional Economic Development offices via using our Lync
technology to do consultation. That has been successful to help feed into the
business innovation agenda and other avenues of which we've partnered with staff
and the Social Enterprise Action Plan where we've been able to use technology
versus travel. So there was a real cognizant effort to find savings.
This
year we anticipate $215,500 is a sufficient amount based on the activities we
have planned. There were less telephone costs as well. We've reduced, I believe,
the number of telephones by what is it 64 in the overall department and we
reduced cellphones I believe by 20 to have an overall savings of about $31,000
in telecommunications that were not being used. Sometimes there were double
lines, faxes, things like that. So having a real good audit and assessment of
what was being used and what wasn't certainly has an impact, and every dollar
certainly adds up.
MS. ROGERS:
Of the four managers, are
they all situated in St. John's, or are they in different parts of the and so
where would they be?
MR. MITCHELMORE:
There would be a regional
manager that would be based in the Western region and there's one in the Eastern
region. One of the management positions would have been, I believe, the
Marystown office. Another position, pending a Regional Innovations Systems Pilot
Project, is to be confirmed. We haven't filled that position yet but it
certainly could be in one of our regional locations. It's certainly open to that
given the Regional Innovation Systems Pilots are taking place all over
Newfoundland and Labrador.
MS. ROGERS:
Will that position be filled
soon?
MR. MITCHELMORE:
We have an expression of
interest going out to see if there's anyone internally within government that
would like to look at filling that position that meets the qualifications. We
had gone through a process with the Public Service Commission for any of the
changes where there was an interview process, and had gone through that for
staffing for positions based on getting the best qualified candidate.
MS. ROGERS:
In Purchased Services,
there's a significant reduction for 2017-'18. What kinds of things will you no
longer be purchasing and what kinds of things will you be purchasing?
MR. MITCHELMORE:
I'm happy to help Minister
Hawkins, I guess, through meeting his reduction in square footage. This
primarily represents our leased office spaces.
The
cost reduction reflects that we relocated our office in Pippy Place that was
$123,000 annually, to Confederation Building. Our Corner Brook office that was
in the Millbrook Mall has now moved into the Sir Richard Squires Building. We
have change at our Carbonear, the Springdale office where there was no employee.
The Marystown office, there were two leases. So we've consolidated them into one
office and determined through zero-based budgeting as well, we could find
further savings.
MS. ROGERS:
Okay. Thank you very much.
CHAIR:
Mr. Kent.
MR. KENT:
Thank you.
With
regard to regional development planning overall, how will things be different
this year as a result of the restructuring or will they in fact be different?
MR. MITCHELMORE:
I think given
The Way Forward initiatives that have
been put in place, there's going to be a lot of focus on the Regional Innovation
Systems Pilot Project. There will be work that will feed into the Social
Enterprise Action Plan, as well as some of the elements around business
innovation through the community supports that would be provided through
Regional Economic Development.
They
will continue to work through the Business Investment Corporation around lending
and loan opportunities and providing that connectivity from a rural and regional
perspective to connect with the right stakeholder, whether it's through talking
to ACOA, talking to commercial lenders, talking to the community Business
Development Corporations, NLOWE, the Newfoundland and Labrador Organization for
Women Entrepreneurs or others.
I could
list on and on, but the roles and responsibilities of our economic development
officers will be focused on being very strategic around looking at the envelope
of programs we have and connect with The
Way Forward such as looking at agricultural opportunities with the increase
in agricultural land that's been provided, connecting with Fisheries and Land
Resources around the Growing Forward
Program, initiatives around marketing that would exist for our fisheries
innovation and marketing and whatnot.
There
is a lot of work that's done on the ground by our regional economic development
officers and we're very proud of the work they do.
MR. KENT:
Are there any changes to the
Regional Development Fund this year?
MR. MITCHELMORE:
The Regional Development
Fund, which is the comprehensive economic development, it's a combined aspect
which includes the broadband initiative, as well as basically $8 million well,
there's $7,960,600, there's $100,000 less. That decrease reflects a reduction in
operating funds. That was a budget decision of 2015-2016, prior to our
government taking the administration. There is one more reduction of $100,000
planned for the next fiscal '18-'19.
MR. KENT:
Are there any offices going
to be closing as a result of the restructuring that's occurred within the
department?
MR. MITCHELMORE:
Well, we've decreased some
of our leased space, as I mentioned earlier, around Pippy Place and Corner Brook
and Carbonear and Springdale and Marystown.
These
lease costs does not change the service we're able to provide because we either
have alternative office space that would be rent free, that's our preference,
whether we find space in the College of the North Atlantic or other government
space as leases expire, but if there are areas where an office closes, there are
certainly avenues of which our economic development officers will be on the
ground providing services, whether they partner with town halls or community
organizations to have those meetings. There's capacity building money to support
opportunities management and sessions all throughout Newfoundland and Labrador.
So we're more than happy to have a broad economic development and business
development conversation.
MR. KENT:
So the initiative to reduce
leased space is a good one. Are there are any communities that will now not have
a staff presence on the ground as a result of these changes? Are all those folks
being affected by coming out of leased space remaining in those same
communities?
MR. MITCHELMORE:
Any office space that would
have had an employee attached to that office space would continue to have an
employee representation in the community.
MR. KENT:
Okay. That's it for me on
3.2.01, Mr. Chair.
CHAIR:
Okay.
3.3.01.
Mr. Kent, if you'd like to start off on this one.
MR. KENT:
The minister's already
spoken to it, so all I'd ask him for is a breakdown of the Grants and Subsidies.
Would we be able to get a list of what's included in the Grants and Subsidies?
MR. MITCHELMORE:
That shouldn't be a problem.
MR. KENT:
That's it for me on 3.3.01.
CHAIR:
Ms. Rogers.
MS. ROGERS:
I'm fine there, thank you
very hang on now.
CHAIR:
Ms. Rogers, on 3.4.01?
MS. ROGERS:
I hear you, thanks.
I would
like to go back to 3.3.01, Comprehensive Economic Development. I know that my
colleague here has asked for a list of the grants. Can you tell if there are any
specific areas that you are looking at, any specific areas that you are looking
to help develop or push forward that look promising for the province?
MR. MITCHELMORE:
This is a fund that focused
primarily on non-commercial activity that works, in many cases, with
municipalities and non-profits, business associations, community economic
development groups, arts organizations, that have specific focus around
infrastructure, trail development. There's been marina development here. There
has been a number of initiatives that should lead to private sector investment
as part of a spinoff and also leverage the greatest amount of federal and
outside sources.
So
we're constantly looking at ways to increase that leverage to the maximum
capacity. We did an announcement recently in Bishop's Falls where over Easter
the department put in $250,000, and I believe ACOA put in around $600,000, and
the town put in almost $400,000.
From
that point of view, that $250,000 was a significant leverage to benefit
recreational angling and lead to stimulation of private sector investment such
as restaurant, accommodations and other initiatives that seem to be part of the
town's strategic plan and initiatives.
This is
where the economic development officers are very critical on the ground and
meeting with community groups and organizations to find regions of the province.
Sometimes these initiatives are either outdoor product development, tourism
development. They could be cultural initiatives. They could be a number of other
things. This is a significant amount of money that we have in regional
development of about $8 million. That leverages significantly more.
MS. ROGERS:
Is there anything specific
that you're kind of excited about in terms of some wonderful projects coming up?
MR. MITCHELMORE:
I would say last year one
exciting project here for the city that you probably would have been excited
about as well was the $500 million that went into the St. John's Farmers'
Market, a co-operative that will change the metro bus station where ACOA put in,
I believe, $2 million for that. The co-op raised $100,000 and the city also
contributed.
It was
a significant piece that's going to lead to a lot of vendors; it's going to lead
to a commercial kitchen. It's going to be a good space for visiting artists that
want to perform and all sorts of great things that are planned with that avenue.
This fund leads to other economic activity that's stimulated by making strategic
investments in infrastructure.
Today,
we launched our Provincial Tourism Product Development Plan, so there are
avenues of which we'll look at visitor entry points around ferry services,
around airports and other entities of which this fund can help leverage activity
as well. I'd be more than happy I know we have Estimates lines, but if you
want to have a conversation about this particular fund, we could have a
conversation offside if you prefer.
MS. ROGERS:
We're going to get a list of
the Grants and Subsidies, I understand, yes? I imagine there is an intention to
spend every penny.
MR. MITCHELMORE:
This is one of the funds
that get heavily subscribed to. You have to evaluate your programs where you're
getting best leverage based on Way
Forward initiatives, directions, where we want to go. Sometimes
programming will lead into the concept of multi-year funding. There is some
avenue to make sure that this program gives the greatest comprehensive economic
benefit to the province.
MS. ROGERS:
Great. Thank you very much.
MR. MITCHELMORE:
I don't believe this is one
that ever had program dollars remaining.
MS. ROGERS:
3.4.01, I see a small
adjustment there in Salaries and Professional Services. We see a significant
increase, as a matter of fact, in the revision for 2016-17. Can you talk a
little bit about that?
MR. MITCHELMORE:
Yes. In 2016-2017, we did
our provincial Exit Survey. This is done every five years, I believe. With that,
we allocate those funds and we're concluding our research on all the people, the
entry points at the ferry terminals and at the major airports to gauge visitor
spending; why people came, what activities they participated in, and then we'll
be able to generate that number.
Hopefully, that spending was over the $1 billion mark. We can provide that
updated figure as to how great tourism was in the province last year because we
certainly felt it in almost every nook and cranny that I visited. That's the
answer, Ms. Rogers.
MS. ROGERS:
So that was done during the
summer I imagine, wasn't it, the Exit Survey?
MR. MITCHELMORE:
The Exit Survey is done all
year round at the major entry points. Then at some of the smaller airports it's
done on a seasonal basis, such as Happy Valley-Goose Bay, and Stephenville and
the Gander airport are done all year round.
MS. ROGERS:
Okay.
MR. MITCHELMORE:
Just Gander and Happy
Valley-Goose Bay, yeah.
MS. ROGERS:
Okay, great.
Thank
you.
MR. MITCHELMORE:
Deer Lake and St. John's
would be year round.
CHAIR:
Mr. Kent, 3.4.01.
MR. KENT:
I have nothing further on
3.4.01.
CHAIR:
On 4.1.01.
Mr.
Kent.
MR. KENT:
Thank you.
I
realize the variance related to Salaries is slight, but could the minister
comment on that?
MR. MITCHELMORE:
The small change was a delay
in recruitment. The new amount is based on the current salary plan for the
department and reflects any of the increases that would be associated with the
staff there. In the tourism department, there are a total of 46 positions.
MR. KENT:
Thank you.
Are
there any changes to the Visitor Information Centres funding this year? Also,
any changes to hours of operation, any staffing changes?
MR. MITCHELMORE:
No, there are no planned
changes.
MR. KENT:
Okay, thank you.
Grants
and Subsidies again, I was just wondering if we could get a list of what's
included in that $221,000.
MR. MITCHELMORE:
The $221,000
MS. MURPHY:
That's two grants: one is
Destination Labrador, $150,000 annually for the DMO, and $71,000 for the Visitor
Information Centres regional grants.
MR. KENT:
Okay, great.
Thank
you.
Minister, can you tell us what the status is of if there is a status yet the
five regional destination development plans that are alluded to in the
Way Forward document?
MR. MITCHELMORE:
Each destination management organization undertook a series of consultations
which basically led to 2,000 stakeholders being engaged throughout the province
overall. Their completion of the destination development plans in each of the
regions fed into the Provincial Tourism
Product Development Plan that was launched today highlighting the priorities
of each of the destination management organizations and initiatives that those
in the industry saw as a priority. So those plans are complete and are available
publicly.
MR. KENT:
They're complete and available publicly already?
MR. MITCHELMORE:
Through the destination management organizations, those five individual
plans. We have our provincial plan that we worked with Hospitality Newfoundland
and Labrador, our tourism board, which is reflective of the destination
management organizations that exist throughout the province.
We represent industry, government and our partners are
there. We're working very collaboratively to deliver on these initiatives to
meet Vision 2020 and grow tourism to $1.6 billion from where it is today.
MR. KENT: Any
changes to the province's tourism marketing strategy this year?
MR. MITCHELMORE:
This past year we have undertaken redevelopment of our website
newfoundlandlabrador.com and focused significantly on our social media channels.
We've run some new campaigns as well, such as our winter tourism ads that ran,
that the Premier launched this past winter.
Recognizing the importance of Destination Canada and
working with our Atlantic Canadian Tourism Partnership, we partnered with the
Connecting America program. We also had a program for millennials where we had
Jacob Hoggard in the video which was about seven minutes, through Woody Point,
Gros Morne area. It had a significant amount of views. It was over 1 million or
2 million views. I'd have to go back and get the statistics, but it's a case
study now for Destination
Canada on how to reach the millennial market.
Our
marketing team is doing exceptional work in the social media channels, in our
packaging, in our online digital. We've continued to win awards. The colours
award that was launched last year was quite significant. We're going to continue
to focus on marketing and continue on with the success.
MR. KENT:
I know I'm pleased to hear
that given the history in this area. It's something we should be proud of and I
hope it continues to grow.
I have
no further questions on 4.1.01, Mr. Chair, but I do have questions on 4.1.02.
CHAIR:
Ms. Rogers.
MS. ROGERS:
Thank you.
I would
like to also commend and congratulate folks in Tourism for the great job.
I have
some questions. My mind strayed there for a moment, so I don't know if my
colleague asked a question about Salaries. We see in the revised in '16-'17 a
loss or under expenditure of $147,000. Did you ask that already, Steve?
MR. KENT:
What's that?
MR. MITCHELMORE:
Yes, it was delayed
recruitment. I highlighted in this year's budget that there's a complement of 46
positions that reflect the salaries of $2,042,400.
MS. ROGERS:
Forty-six positions?
MR. MITCHELMORE:
Yes.
MS. ROGERS:
Okay. Thank you.
That
delayed recruitment, wow, hey? That's a lot of that.
Transportation and Communications; a $94,000 reduction in the revised amount and
another $45,000 reduction in '17-'18.
MR. MITCHELMORE:
The reduction of the $94,000
is less familiarization tours during the 2016-2017 fiscal.
MS. ROGERS:
Why would that be?
MR. MITCHELMORE:
This would be a
determination as to how many FAM tours somebody would undertake as the
department to either fund to do particular outreach. We focused on the ones of
which we could get best value and there was a savings of $94,900. This may not
be a significant amount of FAM tours and I don't know if there's anything
further
MS. MURPHY:
It wouldn't be that we
necessarily did less, it's that we were able to you know, there wasn't as many
large group trade FAM tours. They usually kind of happen every second year, so
there was some realized savings from not having larger groups attend at the same
time.
MS. ROGERS:
Okay.
Thank
you.
MR. MITCHELMORE:
This year you would see
maybe where we've been more cognizant on the number of staff we would take to
our trade shows, through our zero-based budgeting process we would find some
savings that would take place and there are avenues of which from a
familiarization or ways of which government would best reach clientele, some of
that work would be done through destination management organizations where they
are doing that direct outreach in connecting with the consumer, because they're
the ones that are connected to the regions and the industry.
MS. ROGERS:
And Purchased Services?
MR. MITCHELMORE:
Purchased Services, this is
a reflection of where our budgeting exists for our marketing campaigns. The
reduction in the revised budget is basically a reflective of the money we talked
about earlier around the Provincial Exit Survey, the increase. That money would
come from this particular line and it was put into the research budgets. So it's
a reflection of the $195,000, because of where the research survey for the
Provincial Exit Survey was actually conducted.
MS. ROGERS:
Okay, I'm a little bit
confused. So that $195,000 which wasn't spent here, was because it was
MR. MITCHELMORE:
Was spent elsewhere because
it was increased. There was $382,000
MS. ROGERS:
Okay, got it.
MR. MITCHELMORE:
So that's why the budget
line now has been you see the budget is now over $12 million.
MS. ROGERS:
Then another reduction.
Advertising is in Purchased Services?
MR. MITCHELMORE:
Yes. The $101,000 overall in
reduction is in promotional material costs, advertising marketing costs through
zero-based budgeting of where you could find some savings there without having a
negative impact. Whether it's the type of material that's provided or getting a
better media buy or however you would combine that particular aspect. We feel
that having over a $12 million budget directly for marketing is a healthy
budget. We're happy to have that.
MS. ROGERS:
Okay, but in previous years
there was a marketing section and a strategic product development section and
these two sections had a million more than the new section. Is that a reduction
then in those activities?
MR. MITCHELMORE:
The strategic product
development, some of the aspect would fall under Sector Research and some of it
would be under the budget line of Sector diversification. So what would have
been particularly just tourism product development and tourism research has now
been enlarged to focus on the Sector Diversification and the Sector Research. If
you take time to review the Provincial
Tourism Product Development Plan
MS. ROGERS:
Right here.
MR. MITCHELMORE:
it highlights all aspects
of the economy that's going to be impacted through sectors, whether it be
transportation, whether it be the accommodation, the food and beverage sector,
the arts, the cultural sector. So it makes more sense rather than to be narrow
and say tourism product development, but to be focusing on and having a broader
team of sector specialists to be able to work with and implement this
Product Development Plan so we can
get to our $1.6 billion in tourism spending, and also bring the best aspects
that we would have in terms of being able to direct and ensure that these things
are getting done in an efficient way.
The
funds that would have been previously there for tourism product development
still exist in Sector Diversification and Sector Research.
MS. ROGERS:
Okay.
And no
Professional Services, yet it was there in 2016. It's not here now.
MR. MITCHELMORE:
That's been moved to
Research.
MS. ROGERS:
Still for tourism?
MR. MITCHELMORE:
Well, it would be for any
aspect of research that would take place.
MS. ROGERS:
Yeah, so
MR. MITCHELMORE:
Given the impact of the
Tourism Product Development Plan, we
would be looking at activities around the implementation of this provincial
plan. It spans three years.
MS. ROGERS:
Okay.
Also,
many people ask me how come there is no ad in the playbill for
Come From Away. I imagine you get
that question all the time as well.
MR. MITCHELMORE:
We had the exact figures of
what it cost. It cost a significant amount for an ad which was around I
believe it was around $100,000 per month, and that may have been American. It
was a significant amount of money.
The
playbill market is not our market, the New York tourist. The New York market is
certainly a market that Newfoundland and Labrador is interested in, but 63 per
cent of those that take in the Come From
Away play would be the tourist market, and a significant amount of the
market is the Newfoundland and Labrador resident market.
We've
done things strategically around Come
From Away where we've, through our travel and trade, have hosted more than
30 people to look at touring companies that would be coming to Newfoundland and
Labrador, inbound traffic, including airlines, to look at avenues to improve and
enhance air access. That was a key thing.
I
actually went down personally and travelled to attend the show and the event. It
certainly was not a cost to the department for me to do that travel because I
feel this is an important aspect for Newfoundland and Labrador tourism and the
potential that it could lead to.
We also
have our writer's program that exist that we sent our media expert to be
promoting that. We've already gotten about $2 million in promotional or
awareness from all the advertising of
Come From Away. It's probably much larger than that, but that's just a
figure that was provided to us as to what the value, several weeks ago, of what
the ad value was.
We've
also been working through our tourism product specialist in Central. I was
talking to the Town of Gander over the weekend, met with the airport authority
myself and the Assistant Deputy Minister of Tourism and Culture. We've connected
with a number of people on how the people on the ground, the entities, can
either create the Come From Away
passport or maximize value, and the town is stepping up there.
One
other thing we've been involved in is the tour group between Maxxim Vacations
and the Fogo Island Inn. We have packages on Newfoundland and Labrador.com
that's focused on Come From Away. So
there's a lot being done around the Come
From Away marketplace.
We
could essentially spend the bulk of our tourism budget on this initiative and
not really see a return on investment from the point of view of where you
advertise. We've consulted with the US and our own PR and advertising firms and
this was the best decision for the province, and I certainly have confidence in
our tourism adverting group. They've been doing it for a very long time.
MS. ROGERS:
Great, thank you very much.
It's
good to have an answer to the questions I'm sure many of us get.
Thank
you.
Okay,
I'm good.
CHAIR:
Mr. Kent, we're going to go
4.1.02 and 4.1.03.
MR. KENT:
Thank you.
I do
have a few questions related to Marble Mountain Development Corporation. I
understand the minister's previous explanations, I believe in the House of
Assembly, related to the $450,000 reduction but then there's $400,000 earmarked
for capital repairs. That I understand.
There
was a potential savings or projected savings of $50,000. Will that $50,000 now
still be saved after the Easter weekend event?
MR. MITCHELMORE:
Yes. Marble Mountain has
received $306,400 in operational funding. That's the amount they received last
year to operate. They have upwards of almost 150 seasonal employees at their
operation. They gear towards earning their own revenue. Under 4.1.03 they have
their capital, and that is geared towards capital improvements. That, last year,
would have been $450,000. There is a $50,000 savings they will not get.
The
overall investment for Marble Mountain when it comes to capital and operations
is a total of $706,400, which is $50,000 less than last year. The Easter
weekend saw 3,500 ski visits and generated over $30,000 in revenue. There was a
cost of operations.
But if you look at the overall breakdown between the season
pass holders and new skiers that would have purchased lift tickets, it
introduced a lot of people to the hill and would basically require 14 people to
purchase season passes or retain their season passes that would have potentially
not purchased in future years due to the ski hill having ideal ski conditions
and not being open when having ideal ski conditions.
I think there's a real focus that needs to happen with
Marble Mountain to ensure that it is not reliant on taxpayer subsidies. That's a
priority for me and a direction for the interim board as they undergo an
operational review.
MR. KENT: The
$30,000 of gross revenue, would that include the food and beverage plus
equipment rentals? Is there anything else that'd be included in that 30 grand?
MR. MITCHELMORE:
The only equipment rentals that would have taken place would have been for
the real high-end rentals. All of the basic rentals were offered at a free rate.
So anything that would have been the standard equipment would have gone out for
free. That's how that was advertised. And the lift tickets were also free.
So there were revenues that would have been earned through
food and beverage and any other revenue streams that Marble Mountain would have
under its operations.
MR. KENT: Okay.
What other revenue streams would there be other than food or beverage, if
everything else was given away?
MR. MITCHELMORE:
Well, Marble Mountain also does rentals. Marble Mountain has the Marble
Villa. It has
MR. KENT: Okay,
so accommodations revenue?
MR. MITCHELMORE:
It has partnership with the zip line company that generates revenues as
well. This was a very accumulated figure, but right now Marble Mountain is
finishing its statements for
the month of April, and this activity will be in the new fiscal year. As we get
the actual figures from the Marble Mountain management, we will certainly
provide the accounting.
MR. KENT:
So what is the projected
total operating cost to open the mountain for the Easter weekend?
MR. MITCHELMORE:
I don't actually have the
accounted figure but there was estimation that it was $41,000 to operate the
hill over the weekend and the revenues were approximately $31,000. There may be
additional revenues once all the data gets reconciled, whether it would be
revenues that would be booked based on the partnership that exists or anything
that may have been missed or inaccurately accounted for.
Overall
you're looking at, right now, a net of $3,700 per day in overall costs for
offering free skiing and snowboarding based on those early estimates. And that's
the equivalent of 14 people out of the 3,500 people buying ski passes for the
season next year.
It was
a great promotion; received a lot of media attention and coverage that I think
will set a direction to make significant improvements to Marble Mountain such as
innovation, scanning technologies that may help. There are other avenues there
have been a lot of ideas. It's stimulated a lot of discussion and strategic
direction for Marble Mountain and I'm quite excited by that.
MR. KENT:
Are there any discussions
ongoing within your office or are you giving any thought to selling Marble
Mountain? Is that something that is even a possibility?
MR. MITCHELMORE:
The goal of Marble Mountain
right now is to have it not reliant on taxpayer subsidy. And there could be
ample opportunity to look at base developed, as I responded to one of the former
board members. Base development could lead to private sector investment at the
base of Marble Mountain or finding ways to reduce their overall operating costs
such as the small-scale hydro project.
They've
seen a very successful partnership with Marble Zip Tours, which has generated
significant revenues for Marble Mountain itself, and a full operational review
is underway at Marble Mountain that the interim board is undertaking. So I
wouldn't want to prejudge what the interim board and what the review and looking
at all the analytics and doing that analysis would be, but I do think there are
opportunities. I think Marble Mountain can be operational without having to have
a taxpayer subsidy, as I feel that way about other government entities that
we'll probably talk about a bit later.
MR. KENT:
Were there private security
personnel engaged for Easter weekend? Was there a local security company in the
Corner Brook area engaged to do security work on Easter weekend at Marble
Mountain?
MR. MITCHELMORE:
I don't have the details of
who would have been hired at Marble Mountain. The operations of Marble Mountain
rest with the management and the oversight is with the board of directors.
MR. KENT:
Will there be any work done
on the hydro development that you mentioned this year? Are there any funds
budgeted for that?
MR. MITCHELMORE:
Well, this is something that
the board of directors and the management team will be in their operational
review looking at the opportunities, what exists. There was a report done a
couple of years ago and to see if there is financing, if there are
opportunities, if this is the right thing to pursue based on those initiatives,
then that would be something that the decision of the management and the board
at Marble Mountain would come to a conclusion as to what's responsible.
MR. KENT:
What funding did White Hills
in Clarenville receive from your department over the past year?
MR. MITCHELMORE:
I'm not familiar with any
particular funding besides our support to Eat The Hill that we provide in terms
of season extension where chefs would be coming out for that activity. But in
the past, the ski hill has received upwards of, or maybe in excess of, $1
million from government.
MR. KENT:
We understand there was a
meeting with perhaps officials from your department, but certainly your
parliamentary secretary with the board of White Hills during the recent Marble
Mountain controversy. I'm just wondering if any commitments were made to the
board at that meeting.
MR. MITCHELMORE:
You know, there is nothing
in the Estimates here to discuss about White Hills, but I'm more than happy to
have a conversation with White Hills; I've expressed that publicly on the
airwaves. If there are partnership opportunities and they have ideas, they
should certainly talk to the interim board at Marble Mountain to explore their
ideas that they want to talk about, if there are some, particularly around
Marble Mountain.
We have
three ski hills here in the province, Smokey Mountain being another one. Maybe
there's an avenue of which there could be a combination of lift tickets for
those who buy the season passes where it's included. For example, I buy a season
pass at Marble Mountain and maybe that includes two lift tickets to White Hills
and two lift tickets to Smokey and allows you then to travel. If you use them,
that gets paid out; if you don't use it, it doesn't get paid to the entity.
Maybe there's an arrangement.
These
are things that are left up to the organizations and the entities to partner and
package and find the best ways. It is not a government driven initiative.
MR. KENT:
Did you or your
parliamentary secretary request a meeting with the board of White Hills, or did
the board of White Hills request a meeting?
MR. MITCHELMORE:
I'm going to have to ask the
Chair to either in your line of questioning around White Hills, where this is
in the Estimates and the line of questioning. If you have a particular question
about White Hills I meet with stakeholders on a regular basis. I engage with
stakeholders on a regular basis. I have a number of meetings. I'm sure as
yourself as an MHA and in Opposition you have a number of meetings.
I don't
necessarily feel I have to disclose every single meeting that I would have with
an entity or an organization. I, on a regular basis, meet with organizations and
entities to discuss business, to discuss economic development, to discuss
tourism, to discuss culture. It's my role, and as my parliamentary secretary, it
would be his role as well to act on behalf of the department or act on behalf of
any role as MHA.
MR. KENT:
So was he acting on behalf
of your department or was he acting as the MHA for the area?
MR. MITCHELMORE:
I'm not privy to any
particular meeting or the details of a meeting that took place. I wasn't in a
meeting with the White Hills Corporation.
MR. KENT:
Would you be prepared to
have your parliamentary secretary respond? I can see him, he's still there.
MR. MITCHELMORE:
Well, you have a couple of
minutes left in Estimates and if this is how you wish to finish the Estimates
then
MR. KENT:
You told us earlier we could
stay until we were finished.
MR. MITCHELMORE:
Only the fact that we're
debating Estimates activities. White Hills has no Estimates activity. I already
listed all the appropriations. I would say that, Mr. Kent, you are being outside
the scope of Estimates here and I think it's to my staff and all the people who
are here that are working late. I'm not interested in your political games.
MR. KENT:
Wow. I'm just interested in
factual information. The White Hills issue is very much linked to the Marble
Mountain issue. The meeting took place around the time of the controversy.
I'm
asking simple questions and getting long-winded, evasive answers and then you're
making inflammatory comments. It's disrespectful and inappropriate, but if
you're not prepared to answer the questions about White Hills and you're not
prepared to let your parliamentary secretary speak, then we can move on. That's
fine.
CHAIR:
Obviously, we've set aside
three hours this evening for our Estimates meeting. Does the Committee wish to
continue, or does the Committee wish to set aside another time?
MR. KENT:
I'd like to request more
time to continue, as the minister committed earlier this evening. It doesn't
have to be now. It can be at another time, but the minister did commit to taking
whatever time was required to answer our questions.
CHAIR:
Minister Mitchelmore?
MR. MITCHELMORE:
I don't mind continuing this
evening, but I will be focused on Estimates lines.
CHAIR:
Any issues with the rest of
the Committee continuing on?
I
notice that Mr. Kent's time has expired on 4.1.02.
Ms.
Rogers, 4.1.02 and 4.1.03.
Mr.
Kent, if there's something you need we'll come back to you.
MS. ROGERS:
Thank you very much.
I know
it's been a very, very long day. I can see it in all of our faces, but thank you
so very much.
Now
that we've done the ski hills, we can get on to arts and culture.
The
Salaries in
CHAIR:
Excuse me
MS. ROGERS:
Am I
CHAIR:
Did you have anything for
4.1.02 and 03?
MS. ROGERS:
No, I'm fine.
Thank
you.
CHAIR:
Okay.
Mr.
Kent, did you have anything further on
.
MR. KENT:
No.
CHAIR:
Okay. Thank you.
Ms.
Rogers, 4.2.01.
MS. ROGERS:
Thank you very much.
At this
point I don't know if it helps to take my glasses off or leave them on.
4.2.01,
Salaries, we see just a small variation there. I assume we're not losing or
gaining any positions there.
Professional Services, we see a reduction in the revised amount in 2016-17 by
$19,000. Is there anything specific that wasn't done that was going to be done?
MR. MITCHELMORE:
Professional Services this
past year, the $19,500 reflects less heritage related projects required during
the fiscal. That includes archeology projects, evaluation projects and
adjudicator cost.
I
believe last year we transferred one of the commemoration programs to the
Heritage Foundation, and they took up some of the project costs around the
commemoration's program. This year, there's a $9,000 reduction overall. That
just reflects a small amount of research and consultation determined for our
zero-based budgeting process.
MS. ROGERS:
Okay.
Rhonda
Payne, a wonderful playwright and actor who passed away way too young, wrote a
play about women's labour in Newfoundland and Labrador, and it was called
Stars in the Sky Morning. It was that
women in Newfoundland and Labrador worked from the stars in the sky morning to
stars in the sky night. Well, we are at stars in the sky night; I hope we don't
end up at stars in the sky morning, but we'll get through this. It's a beautiful
play. If you ever have the chance to see it, it really is quite spectacular.
Purchased Services; what kinds of purchased services did we see?
MR. MITCHELMORE:
Well, the increase was the
cost for the historic sites evaluations, Occupational Health and Safety and
various upgrades to those historic sites. The $29,000 reflects less exhibition
costs required as determined through our zero-based budgeting process.
MS. ROGERS:
So for the historic sites
evaluations, I don't recall whether or not those evaluations have been made
public. Were they looking at the condition of our historic sites?
MR. MITCHELMORE:
They're Occupational Health
and Safety reports.
MS. ROGERS:
Okay. So it's not about the
historic sites themselves. Okay, great.
Thank
you.
How
were those evaluations?
MR. MITCHELMORE:
I don't have the details of
the evaluations, but
.
MS. ROGERS:
Okay. Thank you.
Grants
and Subsidies; can we have a list of the grants and subsidies for last year?
Have any been allocated for this year yet?
MR. MITCHELMORE:
As I mentioned earlier,
there is funding earmarked for the reinstatement of the art bank to The Rooms
which was cut for a two-year period.
MS. ROGERS:
Good.
That's
different than the MUN art bank. Then there's The Rooms art bank and then
province, provincial.
MR. MITCHELMORE:
This is The Rooms art bank.
MS. ROGERS:
Okay.
MR. MITCHELMORE:
Yes, it's reinstated through
the department.
MS. ROGERS:
Great, good news.
Okay,
thank you.
MR. MITCHELMORE:
The impact to Grants and
Subsidies, this is the CEDP funding for arts.
MS. ROGERS:
Okay, great. We're seeing an
increase there yes, of $102,000?
MR. MITCHELMORE:
Yeah, and that's primarily
through the art bank funding, the reinstatement.
MS. ROGERS:
Okay, great.
MR. MITCHELMORE:
There was no other impact to
the overall funding. There was a small reduction through zero-based budgeting
but the increase in the overall art bank has seen that funding allocated at
$3,450,000.
MS. ROGERS:
Okay, thank you very much.
Then
4.2.02, Arts and Culture Centres, basically we're pretty much the same in the
Salaries. In Purchased Services, we see an increase of $271,000 in the revision
for '16-'17. What kinds of things would have been purchased services in the Arts
and Culture Centres?
MR. MITCHELMORE:
This is a reflection of when
third parties have shows, there is a cost and then the revenue line reflects a
portion of that.
MS. ROGERS:
Yes.
MR. MITCHELMORE:
We've seen increased
activity at our Arts and Culture Centres. So there's a payout of expense to
third-party shows, payments to performers that we would have to pay of $250,000
there, and the cost of a ticketing system upgrade of $23,100. That would have
been a cost that would have been determined through zero-based budgeting and
costs are offset based on revenue ticket sales.
MS. ROGERS:
Okay.
Ticket
sales are handled in-house in all the different Arts and Culture Centres. Is
there any discussion about taking that and privatizing that, moving it out from
in-house at all?
MR. MITCHELMORE:
There hasn't been any plan
changes to our Arts and Culture Centres.
MS. ROGERS:
Good.
MR. MITCHELMORE:
You may like the next
budgetary lines that
MS. ROGERS:
We see that there's been an
increase in provincial revenue. So I imagine that's an increase in attendance in
shows at the Arts and Culture Centres?
MR. MITCHELMORE:
Yeah, we've seen, with
Canada 150, there have been some touring groups. We recently had the National
Arts Centre Orchestra that I had to attend. It was basically near full house.
The Symphony Orchestra, Opera on the Avalon taking increased shows.
MS. ROGERS:
Great.
MR. MITCHELMORE:
There are other groups and
performers and concerts. It's a very busy space dance groups, a lot of people
are utilizing the Arts and Culture Centre, but there's still some space and time
when people can use the venue. So if you know people that are performers and
whatnot, encourage use of our provincially owned Arts and Culture Centre.
MS. ROGERS:
That's great. I've seen that
there's been an increase in using rehearsal space for different groups in St.
John's.
MR. MITCHELMORE:
Yeah. Barbara Barrett
Theatre has seen use.
MS. ROGERS:
That's great. That's
wonderful. It's a great asset.
There
are some problems with our Arts and Culture Centre in terms of the
infrastructure of it. Are there any concerns or money being allocated to look at
that, the building itself? It's having some difficulties.
MR. MITCHELMORE:
Yes, if you look at 4.2.10,
Arts and Culture Centres
MS. ROGERS:
Yeah.
MR. MITCHELMORE:
there's $1.6 million for
appropriations for infrastructure needs at the province's Arts and Culture
Centres. So that's investment to conduct various upgrades at our provincial Arts
and Culture Centres.
We
recognize that the St. John's Arts and Culture Centre is celebrating its 50th
year. It's quite appropriate to make investments into the facility.
MS. ROGERS:
It sure needs it.
Okay,
good. I'm good with the Arts and Culture Centres.
CHAIR:
Mr. Kent, 4.2.01 and 4.2.02.
MR. KENT:
Nothing further, Mr. Chair.
CHAIR:
Okay, Mr. Kent, 4.2.03?
MR. KENT:
Nothing on 4.2.03.
CHAIR:
Ms. Rogers, anything on
4.2.03?
MS. ROGERS:
Only that I'm very happy to
see that there haven't been any cuts there at all. I know that every penny is
used very wisely by artists.
No, I
have no questions but, again, I would like to commend the department for
continuing its commitment. I think there's still room for increases in that
area, and I'll continue to push for that, but I'm very happy to see that there
hasn't been any reduction at all and that everything has been spent.
MR. MITCHELMORE:
I would say that the Arts
Council has taken some new initiatives to reduce some of their own operational
costs, whether it's board meetings, using more technology, moving to an online
grant process, finding ways to best serve its clientele. So it's evolving as
well and certainly very well-run organization that serves our arts community
significantly well.
MS. ROGERS:
Yeah, and that's really
good. One of my concerns, and I think concerns that have been echoed by the arts
community, is in fact that the arts community is growing; the money hasn't been
growing to reflect that growth. So it makes it very, very difficult for emerging
artists to have funding.
That's
a problem and it's a problem of success. I think that as a province we need to
look at how we can better address that so that in fact our arts community can be
a growth sector because I think we all know how valuable it is, as an economic
driver, but also for the hearts and souls of our people.
Thank
you.
CHAIR:
Thank you.
Mr.
Kent, anything on 4.2.05?
MR. KENT:
No, thank you, Mr. Chair.
CHAIR:
Ms. Rogers?
MS. ROGERS:
No, that's fine.
I would
ask if there's any movement to change the operations at all of the Film
Development Corporation. Will it continue to operate as it has been operating?
MR. MITCHELMORE:
Well, the Film Development
Corporation has been appropriated $681,000 for their operations and there's an
equity investment program further up which there's been an additional $2 million
provided in this year's budget to basically support new film projects,
recognizing the growth in the sector.
We were
at the screening of Maudie last night
which is just a phenomenal film produced by Mary Sexton, and the amount of jobs
that are created in film: 600 full-time equivalencies; $46 million in production
last year and the tremendous economic and social benefits that's derived from
film is phenomenal.
I see
the good work that the Film Development Corporation does and we want them to
continue doing the good things that they're doing.
MS. ROGERS:
Yeah, and the interesting
thing is that many of them, many of our television series, many of our films,
actually get their start in the arts council with small grants. That's how
important they are, that those are the incubators.
CHAIR:
Ms. Rogers, anything on
4.2.06?
MS. ROGERS:
Yes.
The
budget for repairs and maintenance in 2017, that seems to be reduced by quite a
bit. That would be Purchased Services, would it?
MR. MITCHELMORE:
The Purchased Services, this
is part of the there was four-year plan to do repairs and maintenance to the
provincial historic sites. It is as scheduled, and this is basically what was
appropriated in 2016-2017 for these areas, also recognizing that Heart's Content
had its 150 last year, that had a portion of the budget.
This
year, there's basically $200,000 worth of work that's planned at three locations
and there's a small amount of $14,800 for additional purchased services.
MS. ROGERS:
What are the three
locations?
MR. MITCHELMORE:
There will be further work
done at Heart's Content, the Beothuk location in Boyd's Cove and Point Amour in
Labrador.
MS. ROGERS:
Thank you.
MR. MITCHELMORE:
This was a scheduled plan
based on the heritage carpenter and consultation as to what was needed to be
done. Last year and the year prior, Commissariat House had received investment,
new windows, a variety of things that would have taken place.
This is
scheduled, it's a planned investment. Once you see improvements that are made
and as things come up, we certainly would have to deal with anything that's
somewhat unforeseen.
MS. ROGERS:
Okay.
Moving
on to 4.2.07, Special Celebrations and Events, there was a significant well,
not so significant, but underspending in Transportation and Communications and
in Purchased Services. If you could just speak to that, please.
MR. MITCHELMORE:
The Transportation and
Communications was less travel. The First World War Commemorations and how it
was billed out was the matter for transportation in last year's budget. This
year the increase of $5,000 reflects basically the rightsizing cost of planned
travel to Beaumont-Hamel, Monchy-le-Preux, Masniιres, the 100 anniversaries;
$25,000 as determined through zero-based budgeting process offset by a $20,000
forecast reduction adjustment overall. This is the amount, the cost of basically
being able to send to deal with the travel associated with that commemoration.
MS. ROGERS:
Thank you.
Shall I
go on to 4.2.08?
CHAIR:
You can use your time as you
like. Sure.
MS. ROGERS:
Okay. Thank you very much,
Mr. Chair.
Grants
and Subsidies under Heritage Foundation of Newfoundland and Labrador; the budget
in 2015 was $515,500 and then in '16-'17 it was $463,300. They used every penny.
Now we're seeing a reduction once again of $20,000 when we've already had
$37,000, $47,000, $52,000 so over a period of two years we're losing $72,000.
That's a significant reduction in that area.
MR. MITCHELMORE:
Well, the Heritage
Foundation, when government went through the Government Renewal Initiative it
reached out to its agencies, boards and commissions to put forward proposals and
initiatives they deemed appropriate, and the Heritage Foundation put forward
this proposal over two budget cycles where they deemed they could reduce their
budget by $52,400.
There
was a $200 increase from a previous budget decision for pension adjustment, and
then this year there is a reduction of $20,400. This is something that would
have gone through the management of the Heritage Foundation, through their board
and put forward to government as a Government Renewal Initiative.
MS. ROGERS:
Okay. It's tough because
their budget has been shrinking while everyone's cost increased.
Newfoundland and Labrador Film Development Corporation
MR. MITCHELMORE:
I think if I could further
add, some of it has to do with the uptake in the amount of grants they would be
providing. There are a set number of heritage structures in the province. Once
they're 'plaqued' and provided their loan and their maintenance funding, their
program is established so it can provide that maximum allowable amount. At some
point there isn't, on an annualized basis, a certain amount of grants that are
being applied for. They did have a period where they did have reserves available
as well in terms of continuing to fund heritage projects.
MS. ROGERS:
Okay.
The
Newfoundland and Labrador Film Development Corporation; the equity and other
business financing, it's good to see that increase. I believe that's a wise
investment.
The
Arts and Culture Centres infrastructure, we've already spoken about that.
I'm
good for arts before we get to parks.
CHAIR:
Okay.
Mr.
Kent, from 4.2.06 to 4.2.10 inclusive.
MR. KENT:
Okay.
You'll
be pleased to know I don't have questions on all of them, but 4.2.06, there were
three positions recently filled at Mistaken Point. They were filled in the last
number of days. I'm just wondering if they were in last year's budget and why
they're only filled at this point.
MR. MITCHELMORE:
You're asking the wrong
minister. The protected areas fall under Fisheries and Land Resources.
MR. KENT:
Okay.
MR. MITCHELMORE:
Our Provincial Historic
Sites are in various locations of the province, such as Bonavista. We have them
at L'Anse aux Meadows, Heart's Content, St. John's.
MR. KENT:
Sorry, Minister.
So is
it correct that your department then, has no involvement in Mistaken Point?
MR. MITCHELMORE:
The only aspect we would
have involved with Mistaken Point would be if there was a regional economic
development aspect to work with the ambassadors we had supported through the
dossier and through the UNESCO bid. We've provided a lot of support at that
point in time.
MR. KENT:
Okay.
MR. MITCHELMORE:
We see it as a positive
thing to the economy and we have some promotional material on our tourism
website around Mistaken Point and the significance of the fossils, but when it
comes to the HR matters at Mistaken Point, it would fall under the Wildlife
Division of Protected Areas because it is a protected site.
MR. KENT:
Thank you.
4.2.07,
the $56,000 for Salaries, is that one position?
MR. MITCHELMORE:
Yes.
MR. KENT:
Was it recently filled?
MR. MITCHELMORE:
That position, no.
MR. KENT:
No. We understand that a
former Liberal staffer, Kim Ploughman, was recently employed in a special
celebrations and events related role. Where would that be located if it's not
here then?
MR. MITCHELMORE:
That's not the
appropriations for the position.
MR. KENT:
So where would we find the
appropriations for that position, and did it go through a competition?
MR. MITCHELMORE:
The particular position
would be under the Arts and Heritage Division.
MR. KENT:
Arts and Heritage Division,
which we're coming to no, sorry, Minister. Which subhead would that be?
MR. MITCHELMORE:
Under 4.2.01.
MR. KENT:
Thank you.
Minister, is that a new position that was recently created, or was it an
existing vacant position?
MR. MITCHELMORE:
It was a vacant position.
MR. KENT:
Was there a competition for
that position?
MR. MITCHELMORE:
It's a 13-week position.
MR. KENT:
It's a 13-week position.
Okay, thank you for that.
That's
it on 4.2.07. Sorry, Mr. Chair, you said to go as far as 4.2.10?
CHAIR:
Yes.
MR. KENT:
So that's it for me up to
that point.
Thank
you.
CHAIR:
Okay, Mr. Kent, 4.3.01.
MR. KENT:
4.3.01 I have nothing on
4.3.01.
CHAIR:
4.3.02.
MR. KENT:
I do have a couple of
questions related to 4.3.02 and then I'm out of pages, which is good news for
everybody I guess.
There's
a significant variance in Professional Services under Park Operations. There's a
decrease there and then under Purchased Services there's a considerable
increase. I was just wondering if the minister could comment on both of those.
MR. MITCHELMORE:
The Purchased Services?
MR. KENT:
Yeah. I'm sorry, the
Professional Services, there's a decrease, and Purchased Services there's a
considerable increase. I'm just wondering if you could comment on those under
Park Operations.
MR. MITCHELMORE:
Okay, so the Professional
Services, this past year there was a decrease of $119,300. It's due to the delay
in the T'Railway assessment project offset by increased costs for Hurricane
Matthew. The decrease of $186,500 reflects net savings from removal of the
T'Railway assessment and the Terra Nova trestle and the inclusion of funding for
required repairs for Hurricane Matthew.
It's
basically moving down to Purchased Services you're seeing a decrease of
$68,000. That's less-than-anticipated repairs and maintenance at our provincial
parks. The increase of $649,000 reflects a net increase resulting from the
removal of funding for the Terra Nova trestle and the addition of the funding
for Hurricane Matthew as well as zero-based budgeting process. So basically,
park maintenance and the T'Railway there is $900,000.
MR. KENT:
Okay, thank you for that.
I had a
question related to Chance Cove Provincial Park. It's somewhat related to
Mistaken Point which I, of course, now fully understand has no connection to
your department, but Chance Cove does. The park is somewhat in a state of
disrepair.
The
reason I'm asking is that given its proximity to Mistaken Point, there are local
players who feel there's an economic development opportunity. Is there any
consideration being given to either investing in the park or potentially
privatizing the park? At any rate, given its current state, probably something
needs to be done.
MR. MITCHELMORE:
One has to look at the mix
of park operations that we have and referring to it as a park, people
automatically think campground. We have serviced campground sites and I believe
Chance Cove is a day-use park.
MR. KENT:
It is, yes.
MR. MITCHELMORE:
So it's one that would not
have a high degree of actual services, given the use of the nature of day parks.
Our staff are on the ground in terms of doing things to take out garbage and
whatnot, and to ensure maintenance at our particular parks and day parks. We
have waterway parks as well and the T'Railway and reserves.
There's
a whole entity of what the Park Operations includes. The day park in question is
one that borders, I believe, a reserve or a protected area. We also have to be
cognizant too as the Natural Areas Systems Plan is developed and the protection
of land and where these areas are and what can actually be and how it can be
utilized or looked at in terms of development.
If
there is somebody interested in looking at economic development, I would say
their best point of contact, given that this would be in the District of
Ferryland, would be to connect to somebody who would either be at the Ferryland
office or talk to somebody in the Confederation Building who works from an
economic development point of view to have those discussions, to begin
conversation.
MR. KENT:
Okay.
So is
there any active consideration being given to decommissioning the park?
MR. MITCHELMORE:
We haven't given any
consideration to these parks or day-use parks. Staff have been given their
notice to be called back to the provincial parks. We're looking forward to our
provincial parks we've opened up our reservation system for the campgrounds
throughout Newfoundland and Labrador. We anticipate full operation of our
provincial parks.
We have
a lot of work to do with the T'Railway, given the impact of Matthew and what it
has done to the T'Railway in the Clarenville, Glovertown area, as well other
aspects of Central Newfoundland and Labrador. We're going to give it utmost
attention because we understand the importance of users from in around that
region and how they depend on the T'Railway for ATV use and for recreation and
the economic value that the T'Railway brings. We will certainly ask for people's
patience while we work through that process, but we are certainly doing
everything we can around our park operations to give people the best possible
experience.
If
anybody knows of something that's in a state of disrepair or in poor condition,
I would suggest that the onus would be on the individual to report it to the
appropriate parks staff or to the department directly. And if the Member
opposite knows of conditions whether it's signage, parks or whatnot that is in
disarray to certainly reach out and make us aware so we can fix those matters.
MR. KENT:
Thank you.
My
final question, during Estimates in another department, Justice and Public
Safety, it was discovered during the course of Estimates that there had been
several errors picked up after the
Estimates were published, to some of the numbers.
In the
case of Tourism, Culture, Industry and Innovation and all of the subheads we've
discussed tonight, have there been any errors noted and numbers that have
changed since the Estimates document
was published?
MR. LOMOND:
There are still possibilities. We are going through a restructuring that, once
we get into this, we might decide that we actually need to move an economic
development officer from one unit to another unit.
MR. KENT:
Right.
MR. LOMOND:
We're not there yet, but we
expect a little bit of growing pains as we start moving through.
MR. KENT:
But no calculation errors at
this point?
MR. LOMOND:
Nothing like that, no.
MR. KENT:
Okay, great. That concludes
my questions. I want to thank all of the staff for sticking around and for your
participation this evening. Keep up the good work.
Thank
you.
CHAIR:
Thank you.
Ms.
Rogers, 4.3.01 and 4.3.02.
MS. ROGERS:
Thank you.
We're
going to get out of here before stars in the sky morning; I can feel it. I love
our parks and our T'Railways. I use them all.
C.A.
Pippy Park Commission, we see a reduction in the Grants and Subsidies of
$81,000? Why the reduction?
MR. MITCHELMORE:
Well, the C.A. Pippy Park
Commission is basically the body of the urban park that exists. Even where this
Legislature is, the campground would be there, the Fluvarium
MS. ROGERS:
Yes.
MR. MITCHELMORE:
aspects of the university,
the College of the North Atlantic. It's way bigger than Stanley Park. It has
Admiral's Green, the golf course. So if you look at the revenue-generating
aspects, we have as a government diligently moved forward based on their
financial statements, their cash flows and their ability to raise revenue that,
operationally, the taxpayer of this province, when we started, was funding the
C.A. Pippy Park Commission $606,000 this was the previous administration for
45 positions, basically subsidizing public golf and the like.
We've
been reducing that significantly as part of a Government Renewal Initiative to
reduce the taxpayer subsidy to this commission. They have a whole suite of
avenues to raise funds, raise revenues, operate efficiently and not be relying
on taxpayer dollars, and still do a good job preserving and protecting the urban
park, which is the intent of the act, and provide exceptional experiences.
Pippy
Park is something I think we should all be proud of and what it offers our
province, but I do think that reducing the reliance on taxpayer subsidy is
pertinent.
MS. ROGERS:
Well, I wondered when that
was going to pop up because you did telegraph that to us earlier this evening
that there was other areas where you wanted to reduce taxpayer subsidies.
Is
there any intention to do that with any of our Park Operations?
MR. MITCHELMORE:
Anything that's been
reflected in the budget has been reflected this past year. You can see that the
reduction in the Grants and Subsidies were $81,500 at the C.A. Pippy Park
Commission.
MS. ROGERS:
Yeah.
MR. MITCHELMORE:
I think there's opportunity
for them to look at different ways of which they operate. They have significant
assets and surplus cash as well.
MS. ROGERS:
Yes.
MR. MITCHELMORE:
So reducing their subsidy
even further would not impair their operation, but it would be important to find
a mechanism to help transition the taxpayer subsidies so that there would not be
anything drastic or dramatic.
We have
plans. Our parks are open. The staff have been called back. They will be
operating this season. We look forward to everybody going camping and booking up
sites.
MS. ROGERS:
Great.
MR. MITCHELMORE:
Given that it's Canada 150
and that the Parks Canada operations are offering free entry points to national
sites and to their park sites, we anticipate that there may be a little bump in
terms of the revenues that will be obtained through
MS. ROGERS:
Great.
MR. MITCHELMORE:
our provincial parks. We
look forward to that.
MS. ROGERS:
Great, thank you very much.
For
Park Operations this is my last question the Salaries, we see a reduction
there of $71,000. Are we losing a specific position?
MR. MITCHELMORE:
I think maybe some of that
may have been with the movement of Parks coming in.
MS. MURPHY:
I believe last year when it was split out between Natural Areas and Parks were
together
MS. ROGERS:
Yes.
MS. MURPHY:
there we changes that had
happened that I think are reflected there now around those positions, but it was
actually around interpretation supervisors that
MR. MITCHELMORE:
Probably would have been a
manager or something that would have been in Natural Areas (inaudible).
MS. MURPHY:
Yeah, so one taken out and one goes back, but we feel confident we're fully
staffed at the office and all our seasonal recalls to run the parks this year.
MS. ROGERS:
Okay, that's it for me.
I want
to thank you so very, very much. It was great to hear from some of you, and
thank you for your incredible work. Many of you are working in areas that we can
be so very proud of. In this time when it's kind of tough for our province that
you've been entrusted with treasures that help us to feel a little bit hopeful.
Thank
you so very much for your work.
CHAIR:
Thank you.
MR. MITCHELMORE:
If I could just make a
comment, Mr. Chair.
I think
Ms. Rogers is right and I think it's incumbent that we all have a role in this
House. Throughout the night and throughout debate, there can be challenging
times and we can challenge each other, but I think at the end of the day we all
want to see our province succeed in the best possible way.
This
department is one that offers significant opportunity to grow and develop the
economy and create jobs. I encourage anyone on the opposite side, if they have
ideas or suggestions on how things can be improved or enhanced, we certainly
would like to hear those. And if there are other partnership opportunities, then
please bring them forward because it's pertinent now more than ever that we move
forward.
I think
that the programming in the department has been maintained and there are ample
opportunities for growth and diversification throughout Newfoundland and
Labrador through our department and we look forward to some good initiatives all
over the province, including the Members opposite. So we look forward to the
days ahead.
CHAIR:
Thank you, Minister.
At this
time, I would like to ask the Clerk to start recalling the subheads, please.
CLERK:
1.1.01.
CHAIR:
1.1.01.
Shall
it carry?
All
those in favour?
SOME HON. MEMBERS:
Aye.
CHAIR:
Against?
Carried.
On
motion, subhead 1.1.01 carried.
CLERK:
1.2.01 to 2.2.02 inclusive.
CHAIR:
1.2.01 to 2.2.02 inclusive.
Shall
the subheads carry?
All
those in favour?
SOME HON. MEMBERS:
Aye.
CHAIR:
All those against?
Carried.
On
motion, subheads 1.2.01 through 2.2.02 carried.
CLERK:
3.1.01 to 4.2.03 inclusive.
CHAIR:
3.1.01 to 4.2.03 inclusive.
Shall
the subheads carry?
All
those in favour?
SOME HON. MEMBERS:
Aye.
CHAIR:
All those against?
Carried.
On
motion, subheads 3.1.01 through 4.2.03 carried.
CLERK:
4.2.05 to 4.3.02 inclusive.
CHAIR:
4.2.05 to 4.3.02 inclusive.
Shall
the subheads carry?
All
those in favour?
SOME HON. MEMBERS:
Aye.
CHAIR:
All those against?
Carried.
On
motion, subheads 4.2.05 through 4.3.02 carried.
CLERK:
The total.
CHAIR:
Shall the total carry?
All
those in favour?
SOME HON. MEMBERS:
Aye.
CHAIR:
All those against?
Carried.
On
motion, Department of Tourism, Culture, Industry and Innovation, total heads,
carried.
CHAIR:
Shall I report the Estimates
of the Department of Tourism, Culture, Industry and Innovation 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 Tourism, Culture, Industry and Innovation
carried without amendment.
CHAIR:
Thank you.
Just to
clue up, I just want to announce that the next meeting of the Resource Committee
will be held on Monday, May 8, at 9 a.m. here in the Chamber with Natural
Resources.
The
Chair would certainly entertain a motion to adjourn.
MR. DEAN:
So moved.
CHAIR:
Moved by MHA Jerry Dean.
Seconder?
Mr.
Bragg.
Thank
you very much.
Meeting
adjourned.
On
motion, the Committee adjourned.