The House met at 2:00 p.m.

MR. SPEAKER (L. Snow): Order, please!

The hon. the Member for Kilbride on a point of order.

MR. E. BYRNE: Thank you, Mr. Speaker.

I rise today to speak in respect of the incidents of Thursday past. As the record shows, on Thursday past I made remarks which Your Honour deemed to be unparliamentary. Your Honour asked me to withdraw those remarks and I declined. As is customary when a member declines to withdraw an unparliamentary remark, Your Honour named me and asked that I remove myself from the House, but I did not leave. Neither did I leave when Your Honour asked the officers of the House to escort me outside.

Upon reflection, Mr. Speaker, it was an act of frustration. On Thursday past I should have accepted the decision of Your Honour in imposing the penalty for declining to withdraw a remark deemed unparliamentary, and I should have removed myself forthwith from the House of Assembly.

I realize, as all members do, that a Parliament, to function effectively, must establish for itself certain rules, and those rules must be accepted and adhered to by members. If those rules are breached without penalty, or if the penalties are disregarded, then the integrity of the Parliament itself is undermined and parliamentary democracy suffers as a consequence.

For declining to accept the ruling of Your Honour on Thursday that I remove myself from the House, Mr. Speaker, I today apologize unequivocally to all members, to all hon. members, to Your Honour, and indeed to the officers of the House. My actions did not mean to cause an unprecedented situation.

Since it is a matter of question whether I indeed served the one day suspension imposed by Your Honour on Thursday, and since I want to eliminate doubt in that regard and ensure the penalty imposed is served, I will, with Your Honour's respect, serve my one day suspension today.

Thank you very much.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The hon. the Member for Fogo.

MR. TULK: Mr. Speaker, as the person who moved yesterday a motion that, after putting forth a case that I believe was a breach of privilege, let me again reiterate to the Member for Kilbride and to all members of this House that I have no desire to do anything that would in any way personally affect either the Member for Kilbride or any other member of this Legislature.

Mr. Speaker, I guess I should say with your Honour's permission, having put forward a case of breach of privilege, now that the hon. member has done what I asked to have done in my motion, I accept and I would ask, Your Honour, if I could drop the case. I think it has been established that the rules of this House, the primacy of the rules of this House are still functioning and they have been enforced and the member, I believe, has done the honourable thing. I would ask that it be put to rest and that the hon. member be granted and be regarded in the same way as any other member of this Legislature.

Thank you.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The hon. the Member for St. John's East.

MR. HARRIS: Thank you, Mr. Speaker.

I want to commend the Member for Fogo for having brought before the House the question of privilege. I think all hon. members, including the Member for Kilbride, recognized as a valid question of privilege an importance for all members of this House now and in the future. I commend also the Member for Kilbride in recognizing that that was the case and for doing the right thing today in apologizing to the House and to hon. members for failing to uphold the traditions of parliamentary democracy. I think that his actions today have restored that honour to himself and to all hon. members.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The hon. Member for Fogo has asked that his point of privilege be withdrawn because the hon. Member for Kilbride has now met the conditions under which the debate would have proceeded had the Chair had an opportunity to rule and had the Chair ruled that it was a prima facie case. I understand that we would probably need the consent of the House for the hon. member to withdraw that point of privilege. I understand that that is what we have at this point in time, that the hon. member's point of privilege is now withdrawn. Is that the understanding?

The hon. the Member for Fogo.

MR. TULK: Mr. Speaker, if I could I would move that that be the case. We see a consensus in this House to withdraw the point of privilege at this point since we have established that the primacy rules of this House have been enforced.

MR. SPEAKER: Is it the consent that it be withdrawn? Okay, the point of privilege is withdrawn. We have an agreement on that. The Chair would like to say that this event of the last week certainly was not an event that we take a great deal of pride in, that it is now dealt with fully and the integrity of the institution of Parliament has been preserved. It has been resolved in a satisfactory manner and hopefully we have all learned that we must, at all costs, preserve and respect the integrity and the dignity of the Parliament that we serve.

MR. SPEAKER: The hon. the Leader of the Opposition.

MS VERGE: Thank you, Mr. Speaker.

I have questions for the Premier about the federal government's plans to make major changes to unemployment insurance. These plans will have a profound affect on Newfoundland and Labrador; no province of Canada will be affected in a more significant way than ours. Most people who have looked at the details of the announced plans believe the net effect will be significant economic loss and disruption for this Province, yet the Premier of the Province still has not re-acted publicly to the changes.

I ask the Premier once again, today, what is your government's analysis of the federal government's proposals to change UI and replace it with EI, and will you table your government's analysis?

MR. SPEAKER: The hon. the Premier.

PREMIER WELLS: Mr. Speaker, I share the view that it will have a very substantial impact on this Province, that's the general analysis. The specific analysis was supposed to have been completed on Friday. I don't have it as yet; it has not been delivered to me. I can't say that it is not completed at this moment, maybe it is, maybe it is on the way to my office right now, but the original date for the completion of it was estimated to have been Friday. I don't have it as yet.

As a result, I wrote the Prime Minister last week. I told him of the Province's concerns, told him of what we thought the level of impact might be and asked for an appropriate meeting at an early opportunity with the Prime Minister and other ministers concerned. I hope that that meeting will be forthcoming and at that time I will be able to set forth clearly to the Prime Minister, not alone the impact of the unemployment insurance changes, but the combined impact of the unemployment insurance changes together with the changes in federal transfers, together with the phasedown of TAGS and the impact that that is going to have; together with the failure thus far of the federal government to respond effectively to the economic consequences of the closure of the groundfish fishery. A combination of all of these things has the potential for an extremely substantial impact. We are doing a complete assessment not alone of the impact of the UI changes, but of the impact of the combining of all of these things at this particular time. That has not been completed, or at least has not been put on my desk. Maybe it is completed by now. It should be sort of any hour or any day now, and when I do have it I have undertaken first to deliver it to the Prime Minister. Once that is done I will let the people of the Province know the impact.

My concern, and I have let this be known to the Prime Minister, is that it will so substantially impact upon our economy on the whole that government will have difficulty dealing with the fiscal and financial consequences of it, and still maintain an acceptable level of public services, and that there will also be difficulty for our people finding job opportunities in the Province. So all of these things must be dealt with in an effective way.

MR. SPEAKER: The hon. the Leader of the Opposition, on a supplementary.

MS VERGE: Thank you, Mr. Speaker.

Everyone knew for weeks in advance that the Federal Government was going to be announcing major changes to unemployment insurance. Other Premiers, such as Frank McKenna of New Brunswick, were fast off the mark in commenting on the impact of the changes on their provinces. Why is the Premier of this Province so slow in responding and assessing the impact of the UI-EI conversion together with the cumulative effect of other Federal Government changes?

MR. SPEAKER: The hon. the Premier.

PREMIER WELLS: Mr. Speaker, just the opposite it true. In fact the lead came from this Province. They were done in discussions directly with the Federal Government and directly with Mr. Tobin. Mr. Tobin then discussed them subsequently with Premier McKenna, with Premier Savage and others. In fact, the lead did not come from the source that the hon. member thinks at all, but we do work co-operatively with the other Atlantic Provinces, and it was the action that I took that caused the meeting to take place with the four Atlantic Premiers. That was the action that was initiated here. Now, I might not make a big splash about it in the papers to get some kind of press coverage for it. I don't operate that way. I operate in a more effective way.

MR. SPEAKER: The hon. the Leader of the Opposition, on a supplementary.

MS VERGE: Thank you, Mr. Speaker.

How does the Premier explain the contradiction between his saying in answer to my first question that he has not yet assessed the consequences of the UI reform, with his later claim that he was somehow in the forefront of the fight of the Atlantic Provinces Premiers. I ask the Premier: when is he going to begin co-operating with the people of Newfoundland and Labrador, the people he is supposed to be representing as Premier of the Province?

MR. SPEAKER: The hon. the Premier.

PREMIER WELLS: Mr. Speaker, it is no contradiction, it is completely consistent with the answer I gave, and let me spell it out in very simple plain terms so the member will understand.

I stood in the House just a moment ago and said, I shared the view of the member. My preliminary assessment of it led me to this conclusion that it would have this very significant impact. The member nodded. It was on the basis of that that I took the action. Now, the detailed assessment is still in the process of being completed. But it was on the basis of the initial reaction that I just three minutes ago explained to the hon. member, which she very conveniently overlooked.

AN HON. MEMBER: Your initial reaction was that it was marvellous.

MR. SPEAKER: Order, please!

The hon. the Leader of the Opposition, on a supplementary question.

MS VERGE: Thank you, Mr. Speaker.

Yes, the Member for St. John's East Extern is correct. The Premier's initial reaction to the UI reforms after his meeting with the Maritime Premiers in Ottawa is that the changes would be marvellous.

Mr. Speaker, let me ask the Premier the most important question. How does the Premier propose to make up the loss that is going to result from the UI reforms? How does the government plan to avoid the disruption and the devastating consequences that several economists are predicting for this Province?

MR. SPEAKER: The hon. the Premier.

PREMIER WELLS: Mr. Speaker, when the assessment is complete, the government will disclose its proposal for the way in which we deal with it. Primarily it will be dealt with by the Minister of Finance and Treasury Board when the minister delivers the Budget. That is the normal course. If there is a need to make a statement before the minister delivers the Budget, then the government will do that. That is the normal way of doing it.

Now, before I sit down, let me say again: I don't know whether the member is doing this deliberately or not, but she knows, and she knows that I've explained to this House before, that I made no such statement about the proposal being marvellous. I dealt with a particular aspect of it, and I refer the hon. member to Hansard at page 2296 for a full explanation of it. To continue making this misrepresentation is quite unacceptable in any parliamentary process, Mr. Speaker.

MR. SPEAKER: A supplementary, the hon. the Leader of the Opposition.

MS VERGE: Thank you, Mr. Speaker.

I say to the Premier that time is running out on this Provincial Government. Some of the UI reforms require Provincial Government initiative right away. There is no time to waste. Let me ask the Premier about the Federal Government transfer of responsibility for training to the Province, about the end of Federal Government purchases of Manpower seats from public and private institutions, about the end of fee-payer type extensions of UI for people who are taking training. What does the Provincial Government propose to put in place as a substitute for the future? What are the goals of the Provincial Government for a federal-provincial agreement for skills, grants and loans or some new fancy student aid which the Federal Government is proposing? What is the Premier going to be offering students in this Province come September?

MR. SPEAKER: The hon. the Premier.

PREMIER WELLS: The preliminary assessment of the federal proposal indicates they are going to change the direction in which they have been going primarily, I think, as a result of the reaction of Quebec to the fact that the course that the federal government has been following in the past has been effectively taking over a matter that was provincial jurisdiction; and it was primarily, I think, to respond to that that they developed the approach that they did.

Their new approach will see them providing funding directly to individuals so that the individual could go, then, to the provincially run institute, or to a privately run educational or training institution, and buy the services in the same way that a student would go to vocational school or to university or any post-secondary institution now. That is the process, as I understand, that they intend to do. Now, the bill is not through Parliament yet. It is not through committee stage, and it has not been finalized, but so far as I know that is what they propose to do.

Now what is the probable impact of that on the Province? Well, we haven't got the full, completed assessment. The Minister of Education can tell you, when the assessment is complete, the extent to which it is likely to see an increase in activity at provincially run schools with the individuals making the arrangements directly because the funding is going directly from the federal government to the individuals either by way of loans or grants or whatever it may be for training. I think they may well be going in that direction, but I do not know all the details of it yet.

MR. SPEAKER: The hon. the Member for Ferryland.

MR. SULLIVAN: Thank you, Mr. Speaker. I have a question for the Minister of Health.

I have been researching the subject of long-term care for many months, and as a matter of fact I had someone call the Agnew Peckham consultants in Toronto and ask them where they got the recommendations for the standards in long-term care that are included in the report that they issued on behalf of nursing homes and funded by this government. They said it came from Newfoundland's Department of Health's own 1990 guidelines in a booklet called Long-Term Care Planning and Functional Programming Guidelines.

Now, the minister keeps referring to an almost ten-year old Osborne report on long-term care. We have a rapidly aging population, and many of the elderly today in homes are being warehoused in substandard and antiquated homes which were never intended nor built to serve as nursing homes.

Now, the minister issued a challenge to me on TV last night, and on radio this morning, regarding -

MR. SPEAKER: Order, please!

MR. SULLIVAN: - to show him one substandard bed in a nursing home in this city.

MR. SPEAKER: Order, please!

I ask the hon. member to get to his question.

MR. SULLIVAN: Mr. Speaker, I say to the minister: I accept that challenge, and I ask the minister if he will come with me today, if we can go on a tour of the nursing homes identified as substandard and obsolete, and I will show him.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The hon. the Minister of Health.

MR. L. MATTHEWS: Thank you, Mr. Speaker.

I am glad the hon. member asked the question because it gives me an opportunity to provide some factual information to the House and to the people of the Province, particularly the seniors, whose fears must have been stimulated yesterday and raised, I guess, as a result of the grossly inaccurate information that the hon. member presented both to the press and to the members of this House. I think I should set the record straight by answering the question this way.

The hon. member yesterday indicated that there were 518 people on a waiting list for long-term care admissions in St. John's. The hon. member further alleged, Mr. Speaker, that we had substandard nursing home beds in the health care system in this Province. To the latter point, let me say this to the hon. member again. Every nursing home in this Province meets nationally accepted and required accreditation standards. There is not today to my knowledge as Minister of Health one substandard bed within the health care system of this Province. If there is one I would ask the hon. member to again identify it. Never mind his grandstanding and going on tours, that proves nothing. Let him give me the information that refutes what I am saying and I will deal with it.

As to the actual number who are waiting for admissions to nursing homes in the Province, the latest information I have from the community health, the St. John's region, assessment and placement committee is this. There are a total of 183 people waiting for admissions to either levels one, two or three care homes in this region as of November 29. Of that number, thirty-seven are people from outside of the region. That leaves us with 146 people waiting for admissions to homes. Of that number, only seventy-five are of the level three category or higher that requires factual and actual admission to a nursing home. The rest are either level one or level two, which could be taken care of in a personal care home.

I think it is a gross insult to the people of this Province that the hon. member would make such unfounded and grossly inaccurate allegations regarding the health care system of this Province. If he has any decency and respect for the Chamber and for himself he would ask that a motion be put that the word "honourable" be taken from his name.

MR. SPEAKER: Order, please! Order, please!

I ask the hon. member to take his seat.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: A supplementary, the hon. the Member for Ferryland.

MR. SULLIVAN: Thank you, Mr. Speaker. I will take his departmental guidelines and I will visit them. Agnew Peckham consultants informed me that they are from the department - I have the guidelines. We can go visit and we can prove for ourselves, I say to the minister. I will show him where they are in each one of the homes! That is what I tell the minister.

SOME HON. MEMBERS: (Inaudible).

MR. SPEAKER: Order, please!

MR. SULLIVAN: The minister has broken that list down into a sub-category. I will provide this list for anybody who wants it, the meeting that you chaired with two other ministers and with your Deputy Minister, Assistant Deputy Minister, and director in the community health board, with 512 names.

MR. SPEAKER: Order, please!

MR. SULLIVAN: I ask the minister - another point of inaccuracy, Mr. Speaker. You stated that medically discharged elderly are only in hospitals for a short duration before being placed. I have information, I say to the minister, I -

MR. SPEAKER: Order, please!

We are now into Question Period, we are not into a debate. The hon. member is on a supplementary and supplementaries should require no preamble. I ask the hon. member to get to his question.

MR. SULLIVAN: Thank you, Mr. Speaker. In light of the information I have which reveals that there are people in acute care beds for several months, some back for twenty-three months, and I have names I say to the minister, I now challenge the minister to prove me right by tabling in this House not the names but the dates on which they were medically discharged and the dates on which they were admitted into nursing homes, and we will see who is correct.

MR. SPEAKER: The hon. the Minister of Health.

MR. L. MATTHEWS: Mr. Speaker, I'm not sure if there was a question, but if there was it was with respect to the status of medically discharged people within the health care system.

Let me tell him first of all, as he knows I think, that medically discharged people are people who are discharged from a hospital but who are waiting to be conveyed either to a long-term care situation or to a personal care home or, in fact, back to their community where they came from in their own residence. Medically discharged beds are a part of the health care system. They are a part of the long-term care system if you like, to the extent that they exist in hospitals for a period of time in that transitional period. I am not sure really, what the hon. member is really trying to get at when he talks about medically discharged people. We have people, Mr. Speaker, in hospitals, if you classify for instance, the Notre Dame Hospital in Twillingate as a hospital, we have people who will be there for years because we have converted part of that facility to long-term care purposes. The same thing applies in the Curtis Memorial Hospital in Springdale, and the same thing to some extent, at the Cross Memorial Hospital in Clarenville, so the hon. member is trying to make a point where there is no point of validity or of substance.

MR. SPEAKER: The hon. the Member for Ferryland, on a supplementary.

MR. SULLIVAN: Thank you, Mr. Speaker.

The minister is trying to play politics with a definition.

Medically discharged, is a person whose physician has indicated is medically discharged from an acute care institution and are waiting to go home or to be placed in a nursing home.

Now I say to the minister, you have used another method to eliminate the practice of admitting those people into emergency departments by blocking their admission through emergency departments, I say to the minister. You are not allowing these people in because -

MR. SPEAKER: Order, please!

MR. SULLIVAN: - when they are medically discharged, there is no place to put them.

MR. SPEAKER: Order, please!

I ask the hon. member to get to his question, he is on a supplementary.

MR. SULLIVAN: I ask the minister: In light of what's happening with specialists at emergency departments telling people, if they don't have a heart attack, a brain tumour or are in danger of dying - and I have a specialist who said that and his name - what is the minister going to do now to be able to give the proper care to those people who go to emergency departments and elsewhere, who need that care?

MR. SPEAKER: The hon. the Minister of Health.

MR. L. MATTHEWS: Mr. Speaker, the suggestion is that there is now a difficulty somehow in our emergency departments that's linked with long-term care. A quantum leap to say the least, if we could make the connection at all.

There is, to my knowledge, Mr. Speaker, no problem, no difficulty in terms of access or service in any emergency or outpatients department in any of the hospitals that we have in the health care system, and I would again say to the hon. member: if he knows of one situation, one person who was inappropriately dealt with at an emergency department, if he knows of one, that is one too many and I am not happy about that, but if he knows of just one, let him bring the name and the circumstance forward and this government would be the first to take its responsibility and insure that it is handled in a fit and proper manner.

MR. SPEAKER: The hon. the Member for Humber Valley.

MR. WOODFORD: Thank you, Mr. Speaker.

My question, Mr. Speaker, is to the Premier.

There has been much hype in the last year or so, Mr. Speaker, with regards to the mineral find in Labrador, namely Voisey's Bay and as of late a request has been made by Abitibi-Price with regards to moving in to Labrador to try to harvest some of the forest potential in that particular area.

One of the stumbling blocks, Mr. Speaker, as everybody in this Province knows and the rest of Canada, is the deal and sometimes a settlement with regards to the aboriginal groups in the area namely, the Innu, Inuit and lately a new group called the Metis. Could the Premier inform the House today and the people of the Province, how negotiations are progressing with regards to land claims with those particular people?

MR. SPEAKER: The hon. the Premier.

PREMIER WELLS: Mr. Speaker, we had made a good deal of progress a couple years or so ago with the land claims with the Labrador Inuit Association and we put in place a speeded up process and as a result of that, the LIA presented a fairly broad and all-encompassing claim to the government. The government responded to that claim and went back and stated its position. That had the effect of narrowing the gap considerably; that's not to say there is agreement between the two parties, there is not at this moment, but we at least know what can be taken off the table.

Now the federal government was not a party to that, so for about nearly a year after the Province responded to that, which I think was in October or November of 1993 I believe - The Member for Torngat Mountains is not in his seat at the moment, he could confirm that date - I think it was about October 1993 that the government responded.

After that, the claim languished and really didn't make very much more progress for two reasons, one of which was, the Province and the LIA were not of one mind on how to proceed from there, but primarily the federal government still had not come on board. Since that time, Mr. Speaker, there has been a revised position.

The federal government is now a participant. The Province and the LIA are arranging meetings and we will be proceeding to further detailed discussions fairly soon. I don't know the immediate detail right now but I can get it and give it to the hon. member if he wishes.

With respect to the Innu, they did not accept our proposal for a speeded up claim and they resisted any efforts. There was a good deal of confrontation between the Province and the Innu which took a variety of forms over a two or three year period. More recently the Innu have changed their approach and they have asked for a speeded up approach. As a result, we entered into negotiations with representatives of the Innu over the course of the summer and I believe - I am just trying to remember the date, I don't know whether it was August? No, it was later then August - it was sometime this fall we signed a framework agreement with the Innu to start detailed land claims negotiations and set out the framework within which those negotiations would proceed. That agreement has been initialled by the negotiators for both parties and is now before the Innu for their formal approbation and before the provincial government for its formal approbation but the negotiators have signed off on it and have initialled it.

With respect to the third group to which the hon. member referred, the Metis, I have to tell you that the Province does not recognize that the Metis have any basis for aboriginal claim in this Province. The only two aboriginal groups that we believe have any basis for claim in the Province are the Inuit of Labrador and the Innu of Labrador. Nobody else has a basis for an aboriginal claim as such because no other group is separately aboriginal to this Province. There are a group of people who have either Inuit or Innu ancestry or they may indeed have some aboriginal ancestry but who may have originated in another province that are amongst the people that identify themselves as Metis in Labrador. They have no basis for an aboriginal claim in this Province and the government -

MR. SPEAKER: Order, please!

I ask the Premier to conclude his answer.

PREMIER WELLS: Yes, I understand it is a bit lengthy but it was an all encompassing question so with leave I will just clue it up.

AN HON. MEMBER: By leave.

PREMIER WELLS: The only other group that has attempted to present an aboriginal claim are the Micmac of Conne River and they, as most hon. members realize, are not aboriginal to this Province. They are aboriginal to Nova Scotia, New Brunswick and Prince Edward Island but they probably - nobody knows with absolute certainty - they probably came to this Province some time after European occupation of the Province started. So there is no basis for an aboriginal claim. The former government agreed to create the reserve in Conne River primarily because the vast majority were - I guess it is probably not accurate to say they created the reserve - they transferred an area of land to the federal government and the federal government took the land and made it a reserve. The Province knew what it was doing at the time and knew what the federal government was going to do with the land and they made it a reserve but that is not a basis for establishing an aboriginal claim in the Province. The only two we are dealing with are the LIA and the Innu.

MR. SPEAKER: A supplementary, the hon. the Member for Humber Valley.

MR. WOODFORD: A supplementary, Mr. Speaker. Would the Premier then agree that if there is no land claim settlement with either the Innu or the Inuit - I guess both those aboriginal groups within the next year, two at the most, although Diamond Fields has said that they are making a decision next year on where a smelter is going to go, and possible development in the Year 2000 or 2001. The one that comes to mind, as of late, is the proposal by Abitibi - Price, especially as it pertains to the Stephenville Mill. Would the Premier not agree that if there is no agreement, land claims settlement within the next year to eighteen months, that this would be detrimental to the mill in Stephenville?

MR. SPEAKER: The hon. the Premier.

PREMIER WELLS: No, Mr. Speaker, I do not agree with that proposition. You see the government has a responsibility to provide for the orderly, rationale, ongoing of economic activity in the Province. Now it is our sincere wish that we have a resolution of aboriginal land claims as quickly as possible so as to avoid any possible conflict but the government simply cannot hold up economic development, economic land or economic resource use for the benefit of the entire Province, on the basis that an aboriginal group says we will not agree to this being done unless we get the land claim that we want. We cannot operate that way and we will not operate that way but I do agree with the hon. member, that it would be a lot easier to deal with resource management issues once the aboriginal claims are resolved, so it is government's desire to try to resolve them as quickly as possible for that reason, but also by reason of the fact that, in fairness to the aboriginal people, we should move as expeditiously as we possibly can to address their fair claims.

MR. SPEAKER: The hon. the Member for Humber Valley, on a supplementary.

MR. WOODFORD: Mr. Speaker, one of the bills before the House now, the Mining and Mineral Rights Tax Act outlines, especially for mining companies in the Province, and more specifically as it pertains to Voisey's Bay, some of the conditions, the monetary conditions, tax rebates and a number of other tax structures that would have to be met by those companies if that mine went into production tomorrow. I ask the Premier: If there were a settlement tomorrow, or probably a month or so from now, depending on whether this goes through the House this week or not, based on this structure it is only natural to assume that in that land claim settlement there would be a monetary settlement involved and included in that for the aboriginal people. Who would pay for this? Would it be the Province, the mining companies, the Federal Government, or a combination of all three? And if that is the case, then would this not mean that this legislation would then be outdated? The money has to come from somewhere. Would the Premier tell the House where?

MR. SPEAKER: The hon. the Premier.

PREMIER WELLS: The issue has nothing whatsoever to do with this legislation, or this legislation has nothing whatsoever to do with the issue. There is no relationship or interconnection between the two, or the taxation has nothing to do with the issue. There is no interrelationship between the two.

We have taken the position, on behalf of the Province, that in terms of land claims, the Government of the Province will work co-operatively with the Federal Government and with the aboriginal people to try to work out the fairest land claim we possibly can, but we have to remember that as far as the laws of this Province are concerned, and the practices of this Province are concerned, every citizen is the equal of every other. You are no better, you have no greater rights, or no lesser rights, because you are aboriginal, you are white, or black, or brown, or you speak French, English, Dutch, or anything else you may speak. We treat all of our citizens on precisely the same basis, and that has been our practice for 400 years. There has never been any differentiation with the aboriginal people.

But, under the Constitution, under Section 92-24, the Federal Government has direct responsibility and jurisdiction with respect to Indians and lands reserved for Indians. That gives the Federal Government the responsibility to deal with this issue, so if there is going to be a special and privileged arrangement for the aboriginal people in terms of a financial settlement, that responsibility rests with the Federal Government, and that is the position we have maintained all along.

Now, when it comes to making land available or providing for land that could be reserved for the exclusive hunting rights to the land, or use of it, we have agreed that the Province would put that up without looking for any compensation.

MR. SPEAKER: Order, please!

I ask the hon. Premier to conclude his answer.

PREMIER WELLS: Thank you, Mr. Speaker.

We have maintained the position that the Province has no responsibility for any financial settlement.

MR. SPEAKER: The hon. the Member for Humber Valley, on a supplementary.

MR. WOODFORD: One final supplementary, Mr. Speaker.

Would the Premier tell the House if he has been approached by Abitibi-Price to see if there can be some kind of agreement reached, so that particular company can move into Labrador to salvage some of the timber there?

MR. SPEAKER: The hon. the Premier.

PREMIER WELLS: I can tell the House, Mr. Speaker, that we have been approached by a number of parties, of which Abitibi-Price was one, that wanted to develop the timber resources of Labrador. Government policy stated to Abitibi-Price and to the others who made the representation, that we would like to see the development of those timber resources take place in such a way that the maximum possible use occurred within the Labrador area where the timber resources were harvested, and if there was to be conversion to lumber and so on, that it be done there in Labrador.

This is the approach we have taken, but we also recognize the need of Abitibi-Price in terms of the long-term future of their mills at Stephenville and Grand Falls, so we will work co-operatively with Abitibi-Price, and any others, to try and see they get access to the wood fibre, but our basis objective is to see that, as much as possible, the development benefit accrues in the Labrador area where the wood is harvested.

MR. SPEAKER: Question Period has elapsed.

MR. SPEAKER: The hon. the Member for Trinity North.

MR. OLDFORD: Thank you, Mr. Speaker.

I would like to table the report of the Social Services Legislation Review Committee. The Committee has reviewed Bill No. 38, An Act To Revise The Law Respecting Limitations, and has approved the bill, subject to five minor amendments which are attached to our report along with the appropriate explanatory notes.

MR. SPEAKER: The hon. the Member for Fogo.

MR. TULK: Mr. Speaker, I rise this afternoon to present a petition on behalf of some -

SOME HON. MEMBERS: Oh, oh!

MR. TULK: Not today, I say to the hon. gentleman. I am not going to be sidetracked by them today either, because this is too important.

Mr. Speaker, I rise -

SOME HON. MEMBERS: Oh, oh!

MR. SPEAKER: Order, please!

MR. TULK: Mr. Speaker, do I detect that there is a sense of `out to get Tulk' today on the other side, or what?

AN HON. MEMBER: Don't be paranoid.

MR. TULK: They have now come from the front benches to the back.

SOME HON. MEMBERS: Oh, oh!

MR. SPEAKER: Order, please!

MR. TULK: Mr. Speaker, I rise today to present a petition on behalf of some 1,000 residents of Fogo Island. I would like to read the prayer of the petition.

Whereas Fogo Islanders have created an efficient and effective school system; whereas the proposed busing changes by the Department of Education and Training will pose safety concerns for Fogo Island children; and whereas the number of students and future attendance will see significant savings for the public; wherefore be it resolved that the bus system be kept as is and changes contemplated by the Provincial Government be not implemented. And as in duty bound, your petitioners will ever pray.

Mr. Speaker, I support the prayer of the petition. I have to advise the House that there are three petitions in one, but I wanted to present them today because I think we may be getting close to the Christmas recess. There is a meeting with the Minister of Education and Training, and I want the House and the minister to know that there are 1,000 people on Fogo Island requesting his attention.

The first `Whereas', I think, sums up quite clearly what the Fogo Island school system is all about. It is a school system that eleven years ago was put together and created a model for all Newfoundland. It is precisely what we are purporting to try to do with some of the changes to the Constitution in this Province and in this country. I say, if the whole Province had been so forward-looking, then we may not even be contemplating the changes that the Provincial Government are presently contemplating doing on Fogo Island.

The changes are draconian, in that the change as recommended in the school busing study was to decrease the number of buses operating on Fogo Island at present from fourteen down to eight - that is almost a 50 per cent cut. I want to say that it is a rare occasion today in this Province when you find a Superintendent of Education coming out on the side of the parents and the public. In this particular case, the Superintendent of Nova Consolidated School Board, Mr. Jack Waye, has come out on the side of the parents on Fogo Island and has asked the Provincial Government not to implement the suggestions that are being put forward by the school busing report. Here is what he says, and here is the reason he says it, and I think he sums it up quite well. In his letter to Dr. Len Williams on December 7, Mr. Jack Waye said:

The issue of safety and the welfare of children has come forward as the main concerns about the proposed reduction of the Fogo Island busing fleet from fourteen to eight buses. The school on Fogo Island is situated in the centre of the island away from everything else. All students are bused to school in the morning and bused home in the afternoon. There is no noon hour busing except for Kindergarten students.

Here is the key, Mr. Speaker: Fogo Island's weather is extremely unpredictable and winter storms can and do come on rapidly. This has occurred in the past and will no doubt happen again. The removal of six buses from the fleet will take away our ability to have all students bused home at the same time. Having to wait up to one hour for buses to make double runs will increase the likelihood that half the student body, in the event of a storm, will be stranded at the school. Compounding this is the fact that there is generally a power outage during a storm. There was one for fifteen hours this past weekend. So a situation could exist where 300 to 400 students would be stranded at the school with no light and no heat. This, obviously, is the worst possible scenario, but given our past experiences the potential of it happening is very great.

He then goes on to say Fogo Island is unique in that it has had a joint services school system for many years. In the sixties and seventies twelve to fifteen schools were in operation; however, the people of Fogo Island have co-operated, and at present a single joint services school complex serves the whole island. There is a feeling that the Fogo Island system is a model of efficiency, and that to attempt to extract further efficiencies will cause undue hardships for children and their families.

Mr. Speaker, I would urge the minister and the government to pay particular attention. I know that the government has to save money. I don't think there is anybody in Newfoundland doubts that is the case, that you have to save money wherever it is possible to save it, but I would urge the Minister of Education, and I will be urging him in the future, and I have to say to him that I will be supporting the people of Fogo Island in their quest, that he not extract, as the Superintendent of Education says, anything else from the people of Fogo Island at this time.

The other thing that we should keep in mind is that the population of Fogo Island, because of the downturn in the fishery, is plummeting - absolutely no doubt about that - and in four or five years, if we keep on the road that we are on, the reduction in buses will come about naturally; the reduction requirements of busing in that area will come about naturally. So there is a process in place which will probably take care of the expenditure, I say to the Minister of Education and to the government itself.

Mr. Speaker, I say I support the petition, and I would urge again that the government not implement the changes that are only presently being contemplated.

Thank you, Mr. Speaker.

MR. SPEAKER: The hon. the Member for Burgeo - Bay d'Espoir.

MR. GILBERT: Thank you, Mr. Speaker.

I stand today to support my friend from Fogo as he presents this petition. I recognize that the Department of Education is going through a change, and one that is long overdue, and one that is there to save money, and they have to try to save money in this era that we are living in; however, what prompts me to support the petition is the fact that I read the letter that the Superintendent of Education for Nova Consolidated School Board wrote in support of this action not being taken.

I had the experience one time a few years ago of going over to Fogo one beautiful morning in February, on a lovely sunny morning going over on the ferry, and checking into the hotel and then going back from the centre of the island, where the school is, back to Fogo to a meeting. In the process of that meeting, from the time we left to get back, it started to snow when that meeting opened and we had to cut the meeting short in order that we would get back in a four-wheel drive vehicle to be able to get back to the centre of the island to the motel. Otherwise, we were going to be stuck in the town council office in Fogo all night. So I recognize the viability of what has happened here, and I recognize that there is a serious problem that can happen, that you could have children stranded in the centre of that island for a couple of days, with those winter storms that they talk about that come on so suddenly in Fogo.

As I support this petition I say to the Department of Education: Have a look at this one. This is, as my friend from Fogo has said, one where the system... They tried to fix the system in Fogo. It was one that they amalgamated some years ago. The system is fine tuned. Have a look at some of the ones that have not done this before you enforce these rules in Fogo. Pay attention to what those people are saying.

It is with great pleasure that I support this petition.

Thank you.

MR. DECKER: Can I speak to the petition?

MR. SPEAKER: Does the hon. minister have leave to speak to the petition?

SOME HON. MEMBERS: Oh, oh!

MR. SPEAKER: Order, please!

Does the hon. minister have leave to address the petition?

The hon. the Minister of Education and Training.

MR. DECKER: I thank hon. members for giving me leave to speak to this petition.

First, I want to compliment the Member for Fogo for the outstanding work he has done for his constituents. You see, the member was not satisfied to just bring this petition to the House, before it came he met with me on several occasions and put forward an argument in favour of his constituents in Fogo, Mr. Speaker. So that deserves to be complimented, unlike I should say, unlike other members in this House who will remain unnamed, who have chosen to get up and posture on this issue, Mr. Speaker, rather then coming in a reasonable way in trying to deal with the issue. So I compliment the hon. member for bringing it to my attention, Mr. Speaker.

I can tell the member and the people of Fogo that this is an issue that the Department of Education and the government will consider. However, I have to explain that busing throughout the Province is being reviewed. In Labrador West, the member already presented some petitions and did a bit of posturing on it. All throughout the Province, Mr. Speaker, busing is being reviewed but there are two very important issues that will be borne in mind as we deal with a reform of busing in the Province. Number one, we have to always be vigilant of the concern that we have for the children of the Province. It is absolutely prior, topmost in our minds, that what we do will be in the interest of the people on Fogo Island, the people in Labrador West, the people in Goose Bay, the people on the Northern Peninsula. First and foremost, the interest of the children will be taken into consideration as we deal with busing. The other matter we have to always be aware of, Mr. Speaker, is the ability of the Province to pay for the services that we offer. We have to spend smarter and wiser and these are cliches that now we have been using over the past number of years, every government in Canada. We have to look at all the services that we provide and we have to provide them in a way which is effective, efficient but most importantly, adequate.

So, Mr. Speaker, again, my compliments, my sincere thanks to the Member for Fogo who brought this matter to my attention. I certainly will be proud to meet with him and we have arranged a meeting between him and the deputy. I did not get a request from across the House, Mr. Speaker, for any meetings to discuss this issue with the district. Instead they got up and wanted to posture on it instead of dealing with it as reasonable people as all men and women of goodwill should do, Mr. Speaker. So congratulations to the member.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The hon. the Member for Placentia.

MR. CAREEN: Thank you, Mr. Speaker. It gives me pleasure today to rise here on a petition put forward by 413 people, mostly from the district of Placentia. The petition reads as such; to the hon. House of Assembly of the Province of Newfoundland in Parliament Assembled, the petition of the undersigned residents of Newfoundland and Labrador ask for the House of Assembly to accept the following prayer;

We the undersigned do hereby ask the Department of Works, Services and Transportation to undertake the upgrading and paving of approximately 21 kilometres of road on Route 91 from Southeast Placentia to the intersection of North Harbour Road, and Route 92 and to upgrade approximately 7 kilometres of road on Route 100-10 from the Argentia Access Road to the intersection of the Southeast Road, Route 91. We ask the Minister of Works, Services and Transportation to address this matter as in duty bound your petitioners will ever pray.

Mr. Speaker, on December 2 of last year I presented a similar petition to this House. That route from southeast going to the Colinet area, North Harbour area, was originally a trail going back that long - D'Iberville on his raids from Placentia to the Southern Shore and St. John's used part of that, way back in the 17th Century. It was used as a cow path, as a trail up until the early part of this century when it was upgraded in the 1920s by the provincial government. It got further improvement and it became a road system when the Americans came in the early '40s. They also put a road behind Dunville because of the inclement weather wintertime in Placentia gut. The Americans maintained this road system up until the early '50s. Since that time it has gotten very little help from the Province, some upgrading over the years. This area is used by people who come in from the North Harbour area, hospitals, banking, policing, it is also used by tourism, people in our own Province who want a shorter loop instead of going the whole way, probably it is Sunday afternoon. We don't have to talk about people from away but we are talking about our own. Because I think in the tourism program a person who travels fifty kilometres further than their home is considered a tourist. This area is very important, still is important. The bridge on Placentia Gut is over thirty years old, and if an emergency should arise in Placentia the way out for people on that side of the Gut is up through southeast and out of that area.

They also want a Dunville road, Mr. Speaker. It is the general Protestant graveyard. Two of them. United together. There is the Anglican and the United. They are there. I was up to a funeral a couple of weeks ago and I was up to my ankles in mud.

AN HON. MEMBER: He isn't serious, (inaudible)?

MR. CAREEN: I am serious, I say to the Minister of Works, Services and Transportation. That area is a well-used road. That area offers an alternative for people travelling on that part of the Avalon Peninsula. It opens an access way that is not there now. It gives people a more reasonable way to get around our particular area of the Avalon. But the hospital, up in the head of southeast, if a person gets sick they will have to come right down the pavement in through Placentia, Jerseyside, up through Dunville. If that area was done - we all know that a minute or two is a difference between a person alive, sometimes, and in the graveyard. It is very important to those people up in that area of southeast Placentia that that area be upgraded and paved.

This is more serious than what the Minister of Works, Services and Transportation gives it. Last year he gave us the answer that the budget wasn't being done. I'm asking the minister, when his budget is being considered this year, and speaking with his federal counterparts, that they look at this area being done and being done properly.

AN HON. MEMBER: (Inaudible).

MR. CAREEN: Don't you talk to your federal people? Don't you talk about any extra monies? You can't be looking at your own single budget.

AN HON. MEMBER: (Inaudible) provincial road.

MR. CAREEN: A provincial road. Yes, and we have seen federal money coming in for provincial roads too. It is all according to where you live, Mr. Speaker. I'm saying that this area is important to the people who live there in emergencies, the people who visit, the hospital and businesses in the Placentia area, and for all the Placentia area, and people who stretch out to my colleague's district, the St. Mary's - The Capes area, North Harbour - Colinet area. Thank you, Mr. Speaker.

MR. SPEAKER: The hon. the Member for St. Mary's - The Capes.

MR. MANNING: Thank you, Mr. Speaker. I'm pleased today to stand and support the petition put forward by the hon. Member for Placentia as it relates to a connecting road between the Districts of St. Mary's - The Capes and Placentia. This road is in both our districts, I would say to the hon. Minister of Works, Services and Transportation, and it affects many people from both our districts.

As the hon. member touched on, you have twenty-one kilometres of dirt road that was built somewhere around 1926, 1927, and was upgraded by the Americans in 1940 and has become - it was and it still is a major link for people from North Harbour, Mount Carmel, St. Catherine's, and right down to Admiral's Beach, the Colinet area, that use their road to travel back and forth to Placentia. As many people know Placentia is a major town in our area. It has the hospital, which is used by the whole area. The RCMP detachment touches into the North Harbour - Colinet area. We have shopping, banking, and we have the Argentia ferry terminal that is used during our tourism season. It is a very important road for not only people within our district but indeed for people who are travelling throughout the Province.

One of the things we have been trying to do to offset the crisis that we have in our fishery is trying to develop our tourism industry in our area. We have, as touched on before, a major link with the Argentia ferry and places like Cape St. Mary's, and the Cataracts which is on this road, and so on and so forth, that are part of this new tourism development that we are talking about. Indeed, we would like to see this road upgraded and paved so we could develop our tourism industry and bring to our district and our area all the dollars that we could get from a new developed tourism industry. This road, Mr. Speaker, is a major part of that tourism.

Mr. Speaker, in the next fiscal year, according to the information I have, we are going to see a fair amount of road work done in this Province. In the next fiscal year, I believe, the department is going to spend somewhere a little less than $50 million on roads, and I am sure the minister, in his wisdom, would be able to take some of that $49 million he plans on spending next year -

MR. EFFORD: What?

MR. MANNING: The $49 million that is going to be spent on roads in this Province next year, I am sure that the minister will be able to put some of that money into this very important connecting road, Mr. Speaker. We have $49 million that is going to be spent on roads in this Province next year, and I am sure the minister would be glad to support me on that. Forty-nine million dollars - I am sure 21 kilometres of road could use a portion of that money, that could be put to good use in this Province instead of being wasted in many cases.

Now, Mr. Speaker, there are many parts of this Province, I am sure, that are looking for road work. Many parts of this Province, Mr. Speaker, would like to have their roads upgraded and, in some cases, paved. But today we speak of the 21 kilometres of road that connect the Placentia area to the St. Mary's Bay north area, a stretch of road that is used by many, many people on a daily basis. As a matter of fact, just Friday night, I, myself, had to travel on that road and I met several vehicles on the road. It is a very important piece of road used by many people. And as I said, we have $49 million that will be spent in this Province on road work next year, under the different agreements we have. I am very surprised that the Provincial Roads Program is only a very minor part of that $49 million - I am surprised that back in 1989 we could find $40 million to spend on roads in this Province, on provincial roads; with four different agreements with the Federal Government now, I believe, and with the Provincial Roads Program, we are going to have $49 million to spend on roads in this Province - and I think there is something wrong with that.

So I ask the minister to take this petition seriously on behalf of the people who signed it. I ask the minister to take the issue of safety seriously for the people travelling this road, and most important of all, tourism development that we are trying to put forward in our area - with this road paved, it would mean a major increase to tourism development. And with a new building at Cape St. Mary's now, a new paved road to Cape St. Mary's, the road paved between North Harbour and Branch, this would be the last of the roads that would indeed put forward a proper tourism development plan for this area. I am sure all the councils, all the associations, tourism associations and committees in the area would fully support this petition I am sure. Many of the people who are on those councils have signed this petition. I ask the minister to take it seriously. This is a major link; we have been talking about it for years. It is one of the oldest roads in the Province, the building of it having been started about 1926-1927 -

MR. SPEAKER: Order, please!

The hon. member's time has elapsed.

MR. MANNING: - and I ask the minister, in his wisdom, to put this forward and, on behalf of the people who signed this petition, to take this petition seriously.

Thank you, Mr. Speaker.

MR. SPEAKER: The hon. the Minister of Works, Services and Transportation.

MR. EFFORD: I am going to be very quick, Mr. Speaker.

I just want to say to the hon. members opposite that the petition they presented, in drawing up the Budget, making recommendations to the budgetary decisions for 1996, that the federal money is allocated, that we will be looking at provincial funding and I will say to him very seriously, I will place him on the priority list. My history, in the department, tells me I am fair in allocating money and I will be as fair in the future as I have been in the past, Mr. Speaker.

MR. SPEAKER: The hon. the Member for Menihek.

MR. A. SNOW: Thank you, Mr. Speaker.

Mr. Speaker, I have a petition to present on behalf of residents of Labrador City and Wabush. The prayer of the petition is:

Whereas because of budgetary restraint, new school-busing proposals are unrealistic and dangerous; and -

MR. EFFORD: You're not serious!

MR. SPEAKER: Order, please!

MR. A. SNOW: Whereas extreme climatic conditions and local conditions force students to use school buses;

Therefore, your petitioners humbly pray that the government allocate necessary funding to permit the continuing operation of a safe and reliable school-busing program in Labrador West.

Mr. Speaker, I am pleased to have the opportunity to rise and speak to that petition, in the sense that previously, the Member for Fogo spoke in presenting a petition on behalf of residents of Fogo and he talked about how the people of Fogo deserve that the government reconsider the cuts to the busing program on Fogo Island because of the extreme climatic conditions in Fogo - approximately a $371,000 saving proposed by the Minister of Education and Training, cuts to the busing program on Fogo Island. I have been speaking for several days, presenting petitions, reading excerpts from letters, and the minister says I was posturing.

Mr. Speaker, I quote from a letter that was written to me. The similarity between both areas, are both have busing that has been designed by people who live in the area and now they are being told by people from outside their area that the new perimeters are going to be designed here in St. John's and inflicted on people outside St. John's, and the people outside St. John's are saying it won't fit.

Now, Mr. Speaker, I am saying that the people in Western Labrador have been sending me petitions and letters. I will read an excerpt from one letter that was send to me by Kathleen Dyke. She says, a few of us have taken it upon ourselves to write to you with our letters to Mr. Decker instead of sending them directly to Mr. Decker's office, since we feel we are being swept under the rug. We are afraid that no matter how many letters the various groups send to Mr. Decker, he will ignore us, but if some of those letters reach your hands first, instead of his, you can appeal to the government on our behalf to reinstate our busing for this area due to the extremes in our climate.

Now, Mr. Speaker, Mr. Decker,the minister responsible for education and training, and the minister also responsible for school busing, the minister also responsible for implementing the proposed cuts to school busing, does not have the trust or the confidence of the people in Labrador, nor the people in Fogo. He referred to, not me by name, but in essence to the fact that I have been posturing in the presentation of similar petitions. I am not posturing, I am merely stating what the people in Western Labrador feel with regard to proposed cuts. The cuts will have the effect of a triple busing system in Western Labrador, triple-decker busing in Labrador.

The people in Western Labrador feel that creates unsafe conditions. Because of the extreme weather conditions, again similar to Fogo, they think i is unsafe, to have triple busing. It is pitch dark at 7:15 or 7:20 in the morning because we are so far north, Mr. Speaker, and people feel that would make it unsafe for young children to be at the bus stop at that hour in the morning. It will also affect, in particular, the French immersion students from the town of Wabush because they will not be given the opportunity to have school busing. About sixty to seventy students will not be able to complete their French immersion program because of school busing being removed. They will either have to provide their own transportation or drop out of the system. That is about six kilometres away and with our extreme climatic conditions it cannot work.

I ask the minister to reconsider the proposed cuts, whether it is in Fogo, where they express their opinions about what is occurring and how it is unsafe for their children. I say to you, and I say to the Minister of Education and Training that I will continue to stand and speak for the people of Western Labrador as long as he persists in refusing to consider the unsafe conditions that exist.

MR. SPEAKER: Order, please!

The hon. member's time has elapsed.

MR. A. SNOW: By leave, Mr. Speaker, if I may?

Does the hon. member have leave?

SOME HON. MEMBERS: Oh, oh!

MR. SPEAKER: Order, please!

The Chair has asked a question. Does the hon. member have leave?

SOME HON. MEMBERS: Yes.

MR. SPEAKER: By leave.

MR. A. SNOW: The Minister of Works, Services and Transportation again gets his knuckles rapped. He is told to: keep quiet, sit down and keep your mind out of it, and your mouth. I ask the minister to reconsider the proposed cuts he has suggested for school busing in Fogo, in support of their petition, and also in the area of Western Labrador. The $330,000 that has been proposed to be cut from the school busing program should not be made.

Mr. Speaker, I feel, as parents in Western Labrador feel, that it is an unsafe condition that will exist if, indeed, these proposed changes will be implemented. The extreme climatic conditions that have been noted here - I have presented actual weather schedules where it has been -70̊ in January or February, which is much too cold for young children to be out waiting 7:00 a.m., when it is very dark.

The fact that we will have triple buses or triple decker busing, whatever you want to call it, that will mean we won't have any lunch time busing in Labrador City and Wabush. In effect, what that will mean, because our school is only one school that has been equipped with cafeteria facilities, because most of our schools, four out of five schools, have not been equipped with cafeteria facilities -

MR. EFFORD: (Inaudible) have no respect (inaudible).

MR. A. SNOW: I have a tremendous amount of respect for you.

Mr. Speaker, the fact that four schools out of five do not have cafeteria facilities means that these children will be going to school without the proper facilities within the school structure itself to have their lunches.

Other than that, what will happen, of course, is that more of the parents will be coming down to the schools. In Labrador City itself, all schools are located in the central part of the town, but because the parents are going to be coming down to that area of town, we are going to have a tremendous amount of traffic in that area, whereas now what happens is that the school buses come in and remove forty to fifty students per bus, all sixteen or eighteen buses of them. What is going to happen now is that parents are going to be coming in and taking people back, and there is going to be a lot of traffic, and the people who are very close to the school are going to be walking, so we are going to have the increased potential to have an accident. The potential will be tremendously increased because of the increase in vehicular traffic, because it is private cars coming down to pick up some of the students, and because of the increased walking because there is no school busing being provided, the potential for an accident is going to be tremendously increased. Now, that will be unsafe.

To quote what a parent said to me on the telephone, while they can see - they pay a tremendous amount of taxes in Western Labrador - they can see and understand how the government must save some money -

MR. SPEAKER: Order, please!

There is too much conversation to my left. I ask the hon. members again to let the hon. member be heard.

MR. A. SNOW: While they can see and understand why there has to be a savings of tax dollars, and they understand it more than most people in this Province, more than a lot - I won't say most, a lot - of people because they pay a tremendous amount of taxes and they want to see their taxes spent wisely, but they also understand that we cannot forfeit children's safety for the sake of a few dollars.

In the words of one parent, she asked me to ask the minister how much he felt her child's life was worth. Was it worth the $330,000 that this government would be saving on school busing in Western Labrador? In the same vein, I am sure that the parents in Fogo who feel that the busing in Fogo, because of the proposed changes, will be unsafe for their children, they would like to know how much a child's life is worth in the minister's mind, because to a parent and to me, and I am sure to most people, a child's life is priceless; it does not have a price in any amount of dollars. You cannot buy a child's life.

I would ask the government, and the minister, especially, to reconsider his proposed cuts to school busing and allow local people in the areas throughout this Province to implement what they feel is safe. Because they have lived and worked in the area and understand what the local climatic conditions are, and they should be the people designing the parameters.

Thank you, Mr. Speaker.

On motion, that the House not adjourn at 5:00 p.m., carried.

MR. SPEAKER: The hon. the Minister of Industry, Trade and Technology.

MR. FUREY: Mr. Speaker, I wanted to just tell the House what business we propose to do today and in the next few days. We may even make progress if the hon. the Government House Leader stays away.

AN HON. MEMBER: Hear, hear!

MR. FUREY: Mr. Speaker, today, I propose to call second readings on Bill Nos. 46 and 50. Then we will move to Committee on Bill Nos. 44, 48, 51, 21 and 35.

AN HON. MEMBER: Could you repeat that, please?

MR. FUREY: I could repeat it, yes. It is Bill Nos. 44, 48, 51, 21 and 35, and I propose to move those into Committee.

Mr. Speaker, I had asked the Opposition parties, Her Majesty's Loyal Opposition and the Opposition House Leader, to forego Private Members' Day tomorrow. On the Order Paper you will see that the hon. the Member for St. Mary's - The Capes has moved a motion which sits there for a private member's day. They agreed graciously to forego Private Members' Day tomorrow so that we could conduct government business.

SOME HON. MEMBERS: Hear, hear!

AN HON. MEMBER: Merry Christmas (inaudible).

MR. FUREY: Mr. Speaker, however, under the rules it does require unanimous consent, and I sought the consent from my friend, the Member for St. John's East, who also has a motion on the Order Paper in his name, which would be right behind the Member for St. Mary's - The Capes. However, the hon. member, I think, is not so gracious. He wants to proceed with Private Members' Day. But I will concede this to him, that the session hasn't ended, nor will the session end, because after Christmas, the House will reconvene. He will know that we sent the Mineral Tax Act to a Standing Committee of Government Services, from the Member for Burgeo - Bay d'Espoir, so we will have to come back and deal with that particular piece of legislation.

At that time, I would propose that we follow the Order Paper and that the Opposition days that are laid forward for the Member for St. Mary's - The Capes, his resolution would come up, and behind that, the Member for St. John's East. And surely, we could deal with it at that time. I would ask him to reconsider unanimous consent to allow us to get on with government business. If he so does, I would propose, with the agreement of Her Majesty's Loyal Opposition, to reconvene the House on Thursday morning at 10:00 and finish the third readings of the orders on the Order Paper. I would seek House consent on that particular matter.

MR. SPEAKER: The hon. the Opposition House Leader.

MR. W. MATTHEWS: No problem, Mr. Speaker. We concur with what the acting Government House Leader has put forward. We have been party to the discussions this morning and again this afternoon and we have no problem with that. That is what we would like to see done. From where I sit, there are members who want to go home for Christmas, have to book flights, have to drive. If we go about it this way, those who have to go home tomorrow can go and those who are left can then finish up on Thursday and be on the road by noon or 1:00 p.m. on Thursday, or catch a flight early on Thursday afternoon to get home.

What we have to remember is, for those who have to travel, that all you need is a bad storm, and one thing and another, and they are here for part of Christmas. I don't think any of us want that.

AN HON. MEMBER: Especially with the way the roads are, too.

AN HON. MEMBER: (Inaudible) stay.

MR. W. MATTHEWS: Pardon? No, I mean, there are some of us have to stay, too, you know, but yes, we realize that.

MR. SPEAKER: The hon. the Member for St. John's East.

MR. HARRIS: Mr. Speaker, I have to confess some difficulty following what the acting Government House Leader said. He has given the order of business for today, and third readings for Thursday. Is he proposing that tomorrow we do no business? I have a little difficulty following that.

AN HON. MEMBER: (Inaudible).

MR. HARRIS: All private members have an interest in Private Members' Day, and the fact that we put them off for two or three weeks, or in this case, two or three months, does not make up for the time. The government is in charge of House business and can open the House or keep it open at will, and it is the government that has loaded down the Order Paper. I don't see why we should, at this stage of the game, start giving up on private members' business for the sake of government business that is being opposed.

With respect to individual members' problems, it has been suggested that if the roads were better looked after, people would not have to worry about being stuck getting home.

On the other hand, the member has asked me to consider it and I will consider it.

MR. SPEAKER: The hon. the Minister of Industry, Trade and Technology.

MR. FUREY: Mr. Speaker, I thank the hon. member; he is so considerate. I just wanted to inform him - I thought he knew - that I said earlier we were going to do two second readings today, which would put us into Committee on those bills tomorrow.

Also on the Order Paper you will see Order 29 and Order 30, which have some amendments to it, which we are preparing, which would be the order of business tomorrow. So there would be four committees tomorrow.

MR. SPEAKER: Order 39, is that the -

MR. FUREY: Mr. Speaker, before we move -

MR. SPEAKER: Order, please!

The hon. the Minister of Industry, Trade and Technology.

MR. FUREY: Mr. Speaker, I would presume that the hon. member would not keep us in suspense too long, because we do have to do some planning.

The other point I wanted to make is that tomorrow we will adjourn at 5:00 p.m., because Your Honour has asked that we move into your reception to celebrate Christmas with your staff and the members, so we have agreed to abide by that. Assuming that the hon. the Member for St. John's East give unanimous consent, we will adjourn at 5:00 p.m., as is usual on Wednesdays, anyway.

MR. HARRIS: (Inaudible) consent to adjourn (inaudible).

MR. FUREY: I know that. You didn't hear me. I said, presuming the hon. member gives us unanimous consent to convert Private Members' Day to a regular government working day, then we will not, on that regular working day, move a motion to sit beyond 5:00 p.m. because His Honour is going to host a reception. Therefore, I give notice that we would be adjourning at 5:00 p.m.

Mr. Speaker, could I call Order 40, Bill No. 50.

Motion, second reading of a bill, "An Act To Amend The Medical Act". (Bill No. 50)

MR. SPEAKER: The hon. the Minister of Health.

MR. L. MATTHEWS: Thank you, Mr. Speaker.

Bill No. 50, "An Act To Amend the Medical Act," is before us and there are basically two areas that the amendments relate to. One is to the requirement to be a member of the Newfoundland and Labrador Medical Board. The second, and more substantive amendments, deal with the issue of peer assessment and peer review.

The purpose of the bill is to provide for Newfoundland and Labrador to be able to participate in peer review assessments with the other provinces in the Atlantic region, namely, Nova Scotia, New Brunswick and Prince Edward Island. Mr. Speaker, this is a positive thing, as it reflects a willingness by physician organizations in the four Atlantic Provinces to co-operate with - to assist each other, really, in ensuring that physicians in their respective provinces adhere to high standards of practice and clinical assessment in terms of patient care and in the proper standards for record-keeping and maintenance in terms of care administered to patients, actually. In effect, the provinces will help each other by having physicians from one province do assessments in another province.

The Medical Act was amended in 1992 to provide regulatory power for the medical board to make regulations with respect to peer reviews. And the subsequent legal review or after a subsequent legal review however, the power that was given was deemed to be insufficient if it were set in regulations only to cover the issues that needed to be addressed; therefore, the more comprehensive amendments embodied in the bill that we have before us, Mr. Speaker, were prepared.

The main purpose really, for this initiative, is to insure that high standards of medical care are maintained. An important way to insure this, of course, is to have periodic assessments and peer reviews undertaken by physicians on themselves. While peer assessment review is being undertaken for the public good, certain protections and certain other provisions are contained in the bill for those positions to carry out and, of course, will be subject to the assessment and the review process. These protections ensure basically that physicians who carry out peer assessments and review will not have to use the knowledge that they gain from the process in legal or disciplinary proceedings, as that is not the purpose, of course, of peer assessments or the peer assessment review program.

These protections, however, will not prevent the knowledge or the information or the documents that exist outside of the peer assessment review from being used in legal disciplinary proceedings, and I would point out that these protections are necessary also to have physicians from other provinces participate in peer assessment and review in their provinces. Similarly, Newfoundland doctors will not be willing to carry out peer assessment and reviews in other provinces without these similar protections.

The amendments that are before the House now and that we are asking the House to approve, are consistent with those that are in place in fact in other provinces. In order for there to be actual co-operation amongst the four medical authorities, there have to be consistent ground rules of course, for the operation of the peer review and assessment program. These measures are positive steps, as I have said earlier, and they will serve to foster and support a program of ongoing medical review and assessment in order to ensure a quality of medical care and a high standard of medical practice.

I might add that the discussions that have led to the preparation of the bill before the House are similar really, to those that were undertaken in the late 1980s which led to the amendment of the Evidence Act, to exclude from legal proceedings information obtained by quality assurance and peer review committees and health care institutions. Basically, in order to undertake the peer review and the quality assurance initiatives, we need to provide protection to the people who carry out those initiatives for the benefit of the public good.

We similarly need to ensure that we do not infringe upon the rights of those persons who are the subject of the reviews and assessments. It is in reality, Mr. Speaker, a question of striking an appropriate balance, I guess, and never losing, of course, sight of the objective of the purpose for peer reviews, because the entire exercise is to serve the greater good of the public in terms of maintaining the high standards of care and services to people. It would be naive, I suppose, to believe that peer review or meaningful peer review can be undertaken without those mechanisms in place. In fact, in reality, physicians will not go to other jurisdictions to carry out those responsibilities without the measures being taken as being in the amended act that is before us.

The other item covered, as I mentioned earlier in the bill, are really of a housekeeping nature, relating to the Constitution of the Medical Board in ensuring that the decisions and actions of the board are not deemed invalid by virtue of some technical reason such as the qualification of board members in terms of whether or not they have a given number of years of experience.

Mr. Speaker, section 1 adds several definitions to the act. Most are new and required in connection with the peer assessment process. This section also adds a definition of licensing authorities, to include in our act the licensing authority in the four Atlantic Provinces. This has to do, of course, with the assessment process as well. This section adds a definition also for medical societies to include the medical societies of the four Atlantic Provinces, again referring and having to do with the peer assessment process.

Finally, Mr. Speaker, in section 1, this section adds two other definitions, namely, the definition for `peer assessment committee' and `peer assessment program'. The amendments to section 2 of the act really does this, it amends the existing section 10 of the Medical Act. The amendment is, in reality, housekeeping and it only adds the words `Mount Pearl' to the region, where, as before, the region as specified in Section 10 referred to St. John's only. It clarifies, really, that three medical practitioners of the seven elected amongst their peers to serve on the medical board have to be those from outside St. John's and Mount Pearl as a region, and that was not clearly indicated in the present section of the act.

It also adds a new subsection that will change, or will clarify, that decisions of the board, either before of after the coming into force of the act, would not be invalid or ineffective by reasons of a technicality such as a regulatory requirement concerning the election of board members or concerning the qualification of board members, or concerning the constitution of the board. An example of why this is necessary is that in the past the board required, through its regulations, that members have at least seven years experience as a physician before they could be elected to the Medical Review Board. While this has now been changed, they want to prevent a party from challenging and rendering a board's decision ineffective that was rendered in the past based on this technicality.

Finally, section 3 of the act introduces a number of new sections to the existing act to provide for the establishment of the peer assessment committee starting with section 24 (1). There are a number of points that I should make on this section, because it is really a whole new section, and really, what it reflects is what otherwise was contemplated to have been covered off in regulation but which was deemed by legal advice that regulation was not the appropriate way to do it. It allows the medical board, first of all, to enter into agreements with licensing authorities and medical societies in other provinces for the peer assessment committee.

Section 3.24 (1) allows the board to determine those things or requirements that would be included in such an agreement, and it provides the peer assessment committee under the board's direction with the power to develop and administer the program in line with the criteria set out on page 4 of the bill, which refers to section 24.31 (a). It also allows the peer assessment committee to appoint physicians or doctors in this Province, or in one of the other three provinces, as assessors for the purpose of peer review.

It grants the assessors certain powers to carry out their work and these powers are more specifically outlined on page 5 of the bill in section 24.5 (1). It also provides for reporting by the assessor and it provides that the peer assessment committee may take certain actions as a result of the report that becomes compiled as a result of their review. It provides that where, during the course of an assessment, the physician or physicians doing the assessment learn that the practitioner may be guilty of professional misconduct or may be incapacitated or unfit to practice, in those cases, the assessment is permitted to be terminated and the medical practitioner advised, and the matter would then be dealt with through the normal protocols that currently exist in the act to deal with such matters, where a complaint of such a nature would otherwise have been registered by another person, or a party, with the medical board.

It also requires the peer assessment committee to prepare and publish on an annual basis a report of its activities for the preceding year. The new sections regarding peer assessment excuse a witness in legal proceedings from providing information retained or obtained by that person in the course of, or in relation to, an assessment under the peer assessment program. In other words, Mr. Speaker, a person who gains certain knowledge during the course of performing a review would not be required to divulge that knowledge in a legal proceeding since the knowledge was obtained for a different purpose. This exemption, of course, would only apply to information obtained by a physician who is carrying out the review. It would not protect information contained in hospital records pursuant to law or to medical records maintained by physicians pertaining to a patient.

Also, Mr. Speaker, although the witness is excused from providing information obtained during the peer assessment process, the witness, being a physician assessor, is not excused in a blanket sense from answering any questions or proceedings or producing any documents which the witness is otherwise bound to answer or to produce.

Similarly a physician-assessor or a member of the peer assessment committee shall not be required to disclose in a disciplinary matter information that they obtained during the course of doing peer reviews. Again, the intent, Mr. Speaker, is that people should not use information they gain from carrying out peer assessments activity for other purpose since the process is not intended as a means to circumvent the normal processes for collecting information or evidence to be used in such cases. The medical board as it stands has the authority to hear any and all complaints that might be brought forward by the general public or by a patient of a doctor who feels that they have not been properly treated or have not received the service in a professional manner that they would be entitled to as a patient of a physician.

The concept is that the peer review process is simply a process to adjudicate the professional level at which the physician is running his practice. If it turns up information that calls into question not the method in which he is operating or the procedures that he has followed, but in fact his qualifications or his personal conduct or calls into question the fact that he may not be a proper professional by virtue of whatever reason, then of course that is a different situation that would be addressed, as mentioned earlier, through the normal protocols that exist.

These amendments to Bill No. 50 to the Medical Act as I say were contemplated in 1992 to have been provided and taken care of by way of regulations. Upon reflection the legal advice that the government received, and I believe the legal advice that came from the Newfoundland Medical Board through its solicitors, indicated that these legislative matters would be more appropriately placed in the body of the bill, rather than trying to be covered off with regulations. That is why these amendments are before us.

Just a minute to speak to the issue of changing the requirement of a doctor from having to have seven years' licensure before they can serve on the medical board. That principle or that condition was called into question by a judge some time ago who was hearing a case against a doctor through the Medical Board, a thing that was called to the Medical Board. The solicitor for the patient made the point that it was unconstitutional or improper to require somebody to be a doctor for seven years before they could serve on the Board. On the basis, I guess, that a doctor is a doctor is a doctor, and therefore the requirement was onerous and superfluous.

In order to take that out and just to have it simply being a doctor of any length of licensure would be able to serve on the Medical Board, this amendment will accommodate that situation. The amendment will also ensure that actions taken while that requirement for seven years' licensure was in place will not cause to invalidate any decisions or any actions taken previously by the Medical Board as a result of operating on that basis.

Mr. Speaker, that in summary outlines the essence of the amendments that are before us in An Act To Amend The Medical Act. I would be happy to answer any questions that might be raised at the end of the debate when I close. I move second reading.

MR. SPEAKER: The hon. the Member for Ferryland.

MR. SULLIVAN: Thank you, Mr. Speaker. I just had a very few comments. I had an opportunity to go through it and look at the current statutes. I can certainly agree with the provisions here. The seven years shouldn't be any reflection on a person's ability of competence or to perform it, and I think that is certainly a good move.

There are protections here that I certainly can support. Information that may be received by that peer committee other than based on a complaint or based on an assessment there could not be used against that particular general practitioner or physician or whatever that wouldn't be pertinent to this issue. I think that is pretty fair game. It is important to have certain protections built in under liabilities there. The minister made reference to especially when someone is out doing their duty and carrying it out appropriately, (inaudible) they need the necessary protections from any liabilities that may arise in the performance of those particular duties.

I don't have any particular problems with this. It gives an opportunity too for a peer assessment committee which may be in the process too of reaching an assessment there if it comes to their attention that a practitioner could be guilty of professional misconduct or incapacitated or unfit to practice. There are always provisions to be dealt with through a complaint procedure there.

Mr. Speaker, I support the legislation here. There are no points that I've seen that are contentious there and that I would have any particular problem with.

MR. SPEAKER: The hon. the Member for St. John's East.

MR. HARRIS: Thank you, Mr. Speaker. I have a few brief remarks, in fact, on this piece of legislation. It does parallel changes that were made a couple of years ago that affected the Evidence Act

and I have the same reservations about this act as I have about that one.

I understand that the medical profession needs to have an opportunity to conduct peer reviews and assessments. In the past, the Legislature did adopt rules that would exempt certain types of discussions and reports between doctors and medical professionals in a hospital setting, to be exempt from discovery and exempt from use in a civil procedure. The reason I have a difficulty about it, I suppose, if you just looked at it in isolation, absolute isolation, total isolation and said is it a good idea or not? The answer probably is that it is a good idea. The big problem that you have is a problem in legal proceedings by individuals who feel that they have become a victim of medical malpractice. The major difficulty is within the medical profession itself in getting someone to testify honestly, fairly and objectively about standards of practice of medicine. You cannot get someone in this Province, very easily, to testify in a court of law about whether or not some other doctor was negligent.

MR. FUREY: (Inaudible).

MR. HARRIS: You don't need to do that because people who are judging the standards of practice in the court of law are all themselves lawyers, whereas -

MR. FUREY: (Inaudible).

MR. HARRIS: No, the acting Government House Leader wishes to prolong debate and I will accommodate him. I will be happy to accommodate him. He, his brother and I can sit down and have a chat about this subject at great length - and his House Leader, the Premier and the Clerks at the table. We can discuss this at great length but I would venture to say that the legal profession is probably the most regulated profession. As one who sits on the discipline committee of the Law Society, I should say that they also act very clearly in reprimanding members when it is necessary to do so but that being said, I would challenge anybody to deny the great difficulty in pursuing a medical malpractice action because the medical profession itself is a fairly closed group when it comes to finding evidence of someone else's negligence.

The difficulties are such that it often requires bringing in people from out of the Province. As a result of these difficulties, very few medical malpractice actions are able to get beyond the preliminary stages because of the cost of doing that and the cost of getting a proper assessment. I would be a lot happier if the medical profession would, in addition to doing their peer review assessment, be prepared to designate individuals to participate fully in attempting to judge the standards of the profession, the standards of practice when it comes to individual circumstances and making available people at little cost or no cost to individuals who are pursuing a legitimate legal action to attempt to get proper evidence as to the standards of practice or what occurred in a particular instance.

I think there are too many examples of privilege in our society and I think that this is one of them. Obviously we see that there is a need and it is one of these situations where there are conflicting needs there. There is a need for the standards of assessment, review and peer assessment to be able to operate so as to improve the practice of medicine and the practice in hospitals and institutions. So obviously everyone supports that aim but to do it at the expense of the availability of evidence to those who have a legitimate reason to question the treatment that they have received in a particular instances is dangerous, I say, because it does deprive individuals of an opportunity to attempt to get justice in a civil matter arising out of the circumstance.

I will leave it at that, Mr. Speaker. It is clear that the bill has the support of the majority of members of the government and the House. In one extent it does in fact just add to the existing legislation the opportunity to do that for a greater group of people; that is the peer review committees of other provinces.

I think it does go a little further in providing that protection and making sure certain records are not made available, but I do have the same difficulty with this as I did with the previous legislation.

Thank you, Mr. Speaker.

MR. SPEAKER: If the hon. minister speaks now he closes the debate, and he has moved second reading.

MR. L. MATTHEWS: Thank you, Mr. Speaker.

I want to thank my hon. critic from Ferryland for his significant support for the bill, and for his co-operation in ensuring that this very good piece of legislation is dealt with expeditiously today, and to the extent that there is support from my hon. colleague from St. John's East, I thank him as well for his support. I understand he expressed the same sentiments in committee hearings back in 1992 when the Evidence Act was changed, although I wasn't around then.

I should point out to him, I am not sure if there is an exact parallel here, but I recall from my days in working with the Department of National Revenue, I say to him, when we went out and commenced what would otherwise be a routine audit, we used to call them field audits then, if certain circumstances were turned up, and certain evidence came to light, and if certain things were revealed in the audit, there was a process whereby the audit would be moved from that section of a standard audit type review to the Special Investigations Division of the Department of National Revenue, which was a division that was set up particularly to deal with SI cases, as we called them then, where there were certain things pretty obvious, like fraud and that sort of thing, and while there may not be a direct parallel between this, certainly the fact that a physician terminates an assessment, if he is a peer review assessor, and causes the medical board to take the matter over, as would be normal under the protocols, is much like that situation. So there is nothing here that prevents the further pursuit of investigation of a physician where something becomes obvious where the peer assessment is reviewed.

Having said that, I appreciate the co-operation and support of the other side of the House and I move second reading.

On motion, a bill, "An Act To Amend The Medical Act," read a second time, ordered referred to a Committee of the Whole House on tomorrow. (Bill No. 50)

MR. SPEAKER: The hon. the Minister of Industry, Trade and Technology. It has been a long day.

MR. FUREY: Mr. Speaker, I know I have been away awhile, so...

MR. SPEAKER: I was going to say international affairs.

SOME HON. MEMBERS: Hear, hear!

MR. FUREY: Mr. Speaker, Order 39, Bill No. 46.

Motion, second reading of a bill, "An Act to Amend The Mineral Act". (Bill No. 46).

MR. SPEAKER: The hon. the Minister of Natural Resources.

DR. GIBBONS: Thank you, Mr. Speaker.

Mr. Speaker, this bill deals with one issue, and it is the requirement condition on a lease relative to further processing of a mineral product. The Explanatory Notes are quite straightforward on this.

The amendments to the Mineral Act contained in this bill would permit the Lieutenant-Governor in Council to require, if it desired to do so, as a condition of a mining lease, that a lessee complete primary production in whole or in part in the Province of any minerals that are mined under this particular lease. These amendments would also provide that the Lieutenant-Governor in Council shall not impose such a requirement where the lessee demonstrates that it would not be economically feasible to do so, or that for some other reason it would not be reasonable to impose the condition.

What we have are some amendments in the specifics of the bill, some amendments to paragraph 31 of the Mineral Act. It is adding a new section, (vi): "that the lessee shall, where required by the Lieutenant-Governor in Council, complete primary production, in whole or in part, in the province," et cetera.

Following on that some other sections have been added. The first one, subsection (6), deals primarily with a definition of primary production. Primary production means "production resulting from smelting, processing or refining a mineral or mineral ore, and includes concentrating and milling of a mineral or mineral ore and all metallurgical operations in which metals or minerals are separated from those impurities with which they may be chemically combined or physically mixed."

Subsection (7) deals with the notwithstanding part of this, where "the Lieutenant-Governor in Council shall not require as a condition of a lease that primary production... be completed... where the lessee demonstrates that it would not be economically feasible to do so...[or that] it would be unreasonable to be required to do so."

Subsection (8) provides a definition of economically feasible. Subsection (9) indicates that we will provide criteria in regard to this by January 1 1997.

That deals with the bill, the first part allowing us to require as a condition of a lease that further processing be provided, and as I said, the condition, if the company can show that it is not economically feasible to do so, then we would not require. The option is there. The option is there though for us to require it if we deem it so necessary and appropriate.

With that said, Mr. Speaker, I would move second reading.

MR. SPEAKER: The hon. the Member for Green Bay.

MR. HEWLETT: Thank you, Mr. Speaker. Just a few words on this. I remember questioning the minister in Question Period some weeks ago now, I guess, with regard to the Voisey's Bay find and saying: Was it the policy of government that if it was economically feasible so to do, was it the policy of government that you smelt it or leave it in the ground. The minister evaded answering that question directly at the time. Obviously it would appear to be policy of government. I guess the question that one must ask is whether or not such policy should at this time be made law.

There are a number of factors obviously involved in determining economic feasibility. The other factor involved in the bill, reasonableness, certain worldwide market factors could very well make a smelter feasible. Whether or not it would be wise under certain circumstances I guess is a question that one could argue forever and a day. There is also, I suppose, always the possibility with a law like this that some large international company having widespread, worldwide holdings could buy up the entire project and sit on it for a period of time, given the fact that it may well have sufficient mineral properties elsewhere in the world to meet the needs of its other smelters. Those are factors that I guess come into play when one thinks about economic feasibility and reasonableness.

This brings me to a point I made generally with regard to the other bill with regard to the taxes, Bill No 43. It is okay to have a policy that we garner significant revenues and significant industrial benefits from a mega-project mine such as Voisey's Bay. I guess the question is: should you make law to that effect?

We are dealing with an industry that's already regulated in terms of its operational procedures, it comes under the Environmental Assessment Act, et cetera. There is already a taxation regime in effect and one would have to ask: would it not be wiser at this stage in the game to enter negotiations with the project concern with regard to a revenue-sharing agreement and with regard to an industrial benefits package which of course, in this particular case would obviously involve a smelter? That way, Mr. Speaker, the laws of general application are left intact. The sales pitch that the Province is a mining-friendly Province is maintained as far as the technicalities of the law are concerned, and at the same time then, the government is fully free to pursue its policy of maximum revenue access and maximum industrial benefits. Those things are laudable policies and can be pursued at the policy level and at the negotiation level.

Now one always has, Mr. Speaker, in government, access to the Legislature at the call of the Speaker to enact laws where companies are reluctant to cut reasonable agreements at the negotiating table, so one has to wonder, with regard to the entire approach here, is it appropriate at this stage of the game to use the route of enacting laws to achieve reasonable revenues and reasonable industrial benefits, when there has been no demonstration that negotiations along those lines have failed and makes that law as necessary?

With regard to the taxation bill, Mr. Speaker, the government indicated that it was going to put the bill out to a committee for further study in the New Year. It may well be advisable as well that the government put this bill out to the same committee for similar study. The two items are in tandem, Mr. Speaker, and they deal with maximizing revenues and industrial benefits to the Province with regard to one specific, mining mega project and as I indicated earlier, there is a valid question whether or not the policy of pursuing maximizing these two goals, should at this stage in the history of the Province, be pursued through law rather than negotiations.

Thank you, Mr. Speaker.

MR. SPEAKER: The hon. the Member for St. John's East.

MR. HARRIS: Thank you, Mr. Speaker.

I have a few words on this bill. I have to say that I support the principle of the bill where the Province is being granted the power to enforce a lessee to complete primary production in whole or in part in this Province of a mineral or mineral ore extracted or removed under a lease granted under the Minerals Act. I think it is quite appropriate that this government have the power to do that. It is after all the resources of this Province that we are talking about and to give unlimited license to people to come and extract the resources from this Province and cart them away for production elsewhere is an abomination of the rights of the people of this Province.

We have to, oftentimes, force individuals and in particular companies to act in the best interest of this Province when coming here to do business. We are told of late, Mr. Speaker, the last number of years as part of the neo-conservative agenda, as part of the corporate agenda, the free trade, right wing individualist anti-co-operative, anti-collective rights atmosphere in which we live, that we don't have the right anymore. That we don't have the right anymore to do anything other than meet the bottom line of anybody who wants to call himself an entrepreneur or a developer and it is wrong, Mr. Speaker. It is wrong and this bill, giving the Province the power to insist on the complete primary production of mineral or mineral ores removed under a lease, is granted.

Now, what I do have a certain amount of difficulty with, not the concept but I suppose the enforceability of it is, the business of excluding from this provision where it can be demonstrated it is not economically feasible, and the attempts, I suppose, to define or enforce the notion of a just and reasonable return.

The definition of economically feasible in clause 1 of the bill, the new subsection 31.(8) of the bill, says, "For the purpose of this section, "economically feasible" means having the capacity to generate a just and reasonable return but does not mean the capacity to generate the highest possible return".

Now I really would wonder under what legal theory a judge who may be asked to interpret this division in a court case, how a judge would be able to determine what would be a just and reasonable return in a particular circumstance. I would be interested in the minister's comments on that when he closes debate. I presume that just and reasonable mean two different things, that something could be a just return but not a reasonable one, or a reasonable return and not a just one, and when a court is asked to determine whether a particular rate of return on investment is reasonable or not, what does he compare it to? Obviously he can compare it to other investments in the mining industry, other investments in Canada, other investments in North America, other investments in the Third World, and what would be a reasonable investment, perhaps, one place may not be a reasonable return on investment another, and for a court to be able to determine what is a just return seems to me to be very difficult of interpretation and application. Although the concept is a good one, it is more of a political term than a legal term, even though obviously the notion of justice is one that the law is used to dealing with, but it is very difficult to apply the simple word `just' to a set of economic circumstances to determine whether a particular rate of return is just, but one slightly more or slightly less than that would be unjust.

While I sympathize with and commend the effort of government to try and give itself the power to insist on primary production of minerals in this Province, and to have whatever leverage it can have with mineral exploration companies and mineral development companies, the question, I suppose, at the end of the day is: Exactly what power does the Province have? And if they break down the negotiations, how is a court actually to decide the matter and determine who is right and who is wrong within the existing legislation?

I would say, though, it probably gives the government substantial leverage, and perhaps that is enough to have a position where it can, in fact, establish a standard that it believes is just and reasonable, which is the measuring point, and then have someone else determine whether or not they are prepared to comply with that and go ahead with their production and development, or their operation under a lease.

The criteria themselves, I suppose, under subclause (9), perhaps would be the measuring stick as to what is just and reasonable. That certainly would be a standard which the licensee or lessee would have to establish its plans based on, but once again that seems to be a fairly moveable criteria, since the Lieutenant-Governor in Council can change that whenever it so wishes. It is not clear exactly how this act would be applied, but the principle of it I support, and since we are at second reading and discussing the principle of the legislation I want to offer my support for the passage of the legislation. I think it is necessary to have this kind of power and right in the government of Newfoundland and Labrador, to be able to insist on production where it is possible to do so and where it feels it must do so in order to ensure that this Province and the people of this Province receive the best possible return on its mineral resources.

Thank you, Mr. Speaker.

MR. SPEAKER: The hon. the Member for Mount Pearl.

MR. WINDSOR: Thank you, Mr. Speaker.

Just very, very briefly because I do not want to belabour this particular piece of legislation out of respect for Your Honour's wishes.

Just to reiterate my colleague for Green Bay who summed it up, I think, quite accurately in that whereas the general principle is one that, I think, all Newfoundlanders and Labradorians, and all members, would certainly want to support. Where it is economically and feasible to have smelting done in the Province then certainly that should take place. It is important though to recognize that whereas we are putting in place with Bill 43 a whole new tax regime, and here we are putting in place a whole new law respecting smelting, that the two combined may well cause something to be unfeasible.

The minister should remember - and we are only using Voisey's Bay as an example, but whereas we have a very high grade ore here which should give a reasonable rate of return, nevertheless if we impose unreasonable taxation and unreasonable requirements for smelting, we could in fact make it non-competitive in comparison with much lower grade ores in third world countries where labour costs and other taxation measures are probably far more favourable, so you have to look at the overall.

I think my colleague for Green Bay summed it up quite well when he said that first of all there is no urgency for this particular bill to pass today, and that it would certainly be inherently sensible, I think, to refer this bill as well to the committee, along with Bill 43, since the two must go hand in hand and should be considered hand in hand and not independently of one another. It would make a lot of sense to do that, and secondly, as he also said, we wonder whether or not this needs to be in legislation. The principles are there. It is a valid policy perhaps but in accordance with the provisions of Bill 43 in negotiating any final agreement, as we have already said, of course, in relation to projects the size of Voisey's Bay perhaps a projects specific agreement is more appropriate than trying to apply legislation of a general nature. It is in accordance with that, in trying to combine all of these things, Mr. Speaker, that it would be in the best interest to consider both acts together in tandem and to try to find a complete set of legislation to apply to the mining industry that is appropriate and that is fair and reasonable to both sides. I am sure that is what we all want.

There is one other point I would like to make to the Minister. Whereas it requires in this legislation that in order to receive a mining lease the commitment must be there for smelting if government so perceives that. I think there may be a problem here in timing, in that in applying for a lease it is a very early stage of the whole process of establishing a mining operation and at that stage of the game the company may not be in a position in all honesty to determine that smelting will be economically feasible.

Now, I realize you cannot say to a company: go ahead and start mining and we will decide later on whether or not you are going to smelter. There might need to be some accommodation here as it relates to the application for the mining lease and including in the business plan at that stage of the game the final resolution as to whether or not smelting will be part of it.

I ask the minister to consider, if he would, referring this legislation to the committee, hand in hand with Bill 43 so that we can look at the overall mining tax and regulatory regime that is going to be put in place in this Province in its totality and not in isolation, Mr. Speaker. I recommend that to the minister. Thank you.

MR. SPEAKER: The hon. the Member for Menihek.

MR. A. SNOW: Thank you, Mr. Speaker.

Mr. Speaker, I am pleased to speak just for a few minutes on the -

MR. EFFORD: (Inaudible).

MR. A. SNOW: It will be very short, I tell the Minister responsible for Works, Services and Transportation, it will be very short if he would allow me to continue.

But, Mr. Speaker, I don't suppose there is a person in this Province who does not agree with the principle of adding value to a natural resource that is going to be mined or produced in this Province. From the number of mistakes that we have made, the number of mistakes that we have made in previous development with regard to not adding a value to a particular resource, Mr. Speaker, has cost this Province untold billions of dollars whether that resource was in the fishery, which was probably the primary resource that we started development here in this Province, or the oil industry. Probably the next one was when we had the seal oil being processed here.

We never really derived any great benefits from the mineral deposits that we developed here on the island and in Labrador but, Mr. Speaker, to pass a law and say this is the way it is going to be at this particular time, I am not sure what it is all about. I am not sure we just should not be doing something on a project basis per se, with regard to it or have it as a principle that we do it because I don't know where this is coming from in a sense of what is going to happen with this particular development now, this mineral discovery in Voisey's Bay.

I remember back when there was a discussion in this Province in the late '50s, early '60s about the development in the Iron Ore Mines in Western Labrador. The Premier of the day, at the time, said that there will be a - we are talking about John C. Doyle's development of Wabush mines property and the Premier of the day, Mr. Smallwood, said that there will be a pelletizing plant in Wabush or else. The `or else' was that they were going to put it down in - he was going to take some action. Then he went on to say that if they put that pellet plant in the Province of Quebec it will be over my dead body. That is what he said, it is going to be over my dead body and Newfoundlanders and Labradorians cheered him for it. Boy, what a commitment by this Premier for the people of this Province to stand up and fight for -to get the most, get the highest amount of revenue possible. The highest number of benefits, the greatest amount of benefits that can accrue to the people of this Province from a resource. He was going to sacrifice his life for it, that is what he was going to do. Lo and behold, what do we see happen? A pellet plant was built. It was built down in Seven Islands, in Point Noir to be exact and what do we see today? We have lost untold hundreds of jobs because of it.

Now, Mr. Speaker, I say that and today the Premier agreed with the principle -

AN HON. MEMBER: (Inaudible).

MR. A. SNOW: Anyway, Mr. Speaker, the Premier today agrees with the principle of further adding value to products in Labrador. As an example, he said today in Question Period: we would like to see development of these timber resources take place in such a way that the maximum possible use occurred within the Labrador area. Mr. Speaker, the Premier said that about timber and I am sure that he would like to see it with minerals. I feel that it only be proper that we should have it with minerals, we should have it with timber but resources we are going to develop in Labrador, we should add that benefit within Labrador. I think that if there is any hope for this Province we have to start thinking in that manner. It is an area of this Province that has been exploited to the nth degree with regard to the attitude from the insular part of the Province of: Go up north, go to work, take the resources, come back and live down here on the Island, or whatever it is, take the resources, process them in Quebec, and when the mine is finished that is it; we will close her up and move on.

Mr. Speaker, we have to look at this, I believe. If we have any hope in this Province we have to be using Labrador as our method of development and progress. That is going to be the engine. That land will be the engine of recovery for this Province, but it won't be if we continue along the lines that we are going to bring the resources down here, add value to them, and then everything will be okay; we will create a few more jobs, another Stephenville mill in point.

Today in Question Period we talked about how our woods resources on the Island portion of the Province have been put in jeopardy because of the increased load that has been put on it, the increased demands that have been placed upon it, because of the addition of another mill on the Island portion of the Province. If that mill had been located within Labrador we would not have the problem of resources today with regard to the demand on the timber. We probably would have had that mill working today in Labrador, making a good dollar for the investor, creating a lot of employment in Labrador for the people of Labrador and the people of the whole Province, and the people of this Province have to start thinking that it is better to go to work in Labrador than it is to have to move to Northwest Territories, or to move to Manitoba, or move to British Columbia, or to get twenty weeks work in Ontario. It is better to go to work in Labrador and live there for the next couple of hundred years. That is what we have to get our minds around.

Mr. Speaker, if that mill had been put in Labrador we would have two good mills in this Province, or at least the resources would have been available without a problem for two mills. That mill would have been operating. We probably would have had a lumbering industry with that mill in Labrador. It would have increased the transportation routes within Labrador because of the extra commerce going on in Labrador, so that land would have been opened up. That land would have been further developed. It would have been a greater opportunity for investment, which means a greater opportunity for more business, which means a greater opportunity for more employment.

We have to take the same approach with the mineral development. We just can't think of taking that mineral from the Labrador portion of the Province, bringing it down to the Island and say we are going to put it here. It has to be done within Labrador. There isn't another availability, that I know of, in this Island portion of the Province, to have hydro development that will be able to sustain the power that will be necessary to operate a smelter. In Labrador we have several rivers that would be able to be developed, that could maintain and service all the infrastructure that would be required for the concentration and also for the smelting of this particular ore deposit, so we could end up with a hydro development that could be cheaper. It could be cheaper to do it -

AN HON. MEMBER: Five minutes.

MR. A. SNOW: Mr. Speaker, what I am saying is that by doing this, if we were to say it has to be in Labrador, then that is where it should be. We have to ensure that this development is done, the value added to this resource is going to be done within Labrador, because if we don't, generations later people are going to be saying: How silly were they? Look at the mistake they made again. It wasn't bad enough to do it in the iron ore deposits in Western Labrador, it wasn't bad enough in Churchill, it wasn't bad enough with the liner board mill; we had to do the same thing again with the Voisey's development. If we do that, whether it is you people in government on that side, or me sitting here as a private member, and not speak up and not talk about it, that it has to be done in Labrador, we are going to be doing untold damage to many generations coming down the road, I believe, because that land, those resources that are down there, have to be properly utilized, and to just have the same mentality that our forefathers had of just going to Labrador, bring the resource out and maybe add some value to it here on the Island, just because there are going to be a few jobs, is not a proper way to develop a Province, or any country, so I would urge that the government reconsider it, and the terms of reference for the companies that would operate, I am not sure it should be put in law in this particular sense, but the terms of reference that they could use and should use, should be that the value-added processing, smeltering, that type of thing, has to be done closest to the resource because, if you stop and think of it, I know it is nice to be able to say that it will be good to have a smelter in Argentia, you can drive to work, even from St. John's, you could drive out and go to work in the smelter, but what about the extra added demand that is going to be put on the electrical energy in this Province? Who is going to subsidize that?

This smelter is going to be around for fifty years, who is going to subsidize the electrical energy that will be consumed? We will end up with another Long Harbour possibly where the consumer, the ratepayer who is living in St. John's or living in Gander or Grand Falls wherever, while there might be 400 or 500 jobs, the ratepayer will end up ultimately subsidizing the electrical rates in a smelter that is going to be on the Island portion of the Province, because, Mr. Speaker, what will happen is that there is going to be a greater demand for the electricity and because of that greater demand for the electricity, it is going to cost more.

Now, Mr. Speaker, with those few remarks, I would hope that government would reconsider and take this bill, Bill 46, An Act To Amend The Mineral Act, and I concur with previous speakers who suggested that what we should be doing is having more public discussion on this, pass it over to the review committee, so that the public can have input and we can have more discussion publicly with regard as to how these resources should be developed, because it is very, very important not just for the people today, and this should not just be used as some election gimmickry for a few months, because that is what got us in trouble before, that is what got this Province in trouble.

We have to think of this as a long-term economic development plan and the only way we can do that, Mr. Speaker, I think in all honesty, is to do what my colleagues and I have suggested.

Thank you.

MR. SPEAKER: If the hon. minister speaks now, he closes the debate.

DR. GIBBONS: Thank you, Mr. Speaker.

I thank the hon. members opposite for their comments, for their support of the principle of this bill. I acknowledge the caution expressed by some hon. colleagues but I would like to say though, that this is not a new principle in the mining industry in Canada. We don't have to look any further than the closest province, Nova Scotia and the next closest to that, New Brunswick to see this same principle embedded in their legislation related to mining leases and we are doing no different from what they are doing in expressing this principle. I acknowledge the comments that have been made by the hon. the Member for Menihek, considering that he would like to limit it even more and say it should all be done in Labrador. I would like to say though, relative to your comments on electricity, this will not be subsidized no matter where it is.

I have noting further to say on this matter, Mr. Speaker, and I move second reading.

On motion, a bill, "An Act To Amend The Mineral Act", read a second time, ordered referred to a Committee of the Whole House on tomorrow. (Bill No. 46).

MR. SPEAKER: The hon. the Minister of Industry, Trade and Technology.

MR. FUREY: May I move that the House resolve itself into a Committee of the Whole to deal with five bills which I spoke about earlier?

I should tell the finance critic that the finance minister is here for about fifteen minutes, he has a flight to catch to the West Coast so we are going to deal with Bill 44, the pensions bill, right away.

On motion, that the House resolve itself into Committee of the Whole, Mr. Speaker left the Chair.

MR. CHAIRMAN (M. Penney): Order, please!

A bill, "An Act To Amend The Pension Benefits Act (No.2)." (Bill No. 44).

Motion, that the Committee report having passed the bill without amendment, carried.

MR. CHAIRMAN: The hon. the Minister of Industry, Trade and Technology.

MR. FUREY: Mr. Chairman, Bill 48, the Attorney General's Act.

MR. CHAIRMAN: Bill 48, "An Act To Remove Anomalies And Errors In The Statue Law."

The hon. the Minister of Industry, Trade and Technology.

MR. FUREY: Mr. Chairman, I am not sure if the Member for St. John's East - did you catch the amendments? I believe it was in clause 15 where there were double wordings there? Okay, and that is all corrected?

A bill, "An Act To Remove Anomalies And Errors In The Statute Law." (Bill No. 48)

On motion, amendment carried.

On motion, clause 14 as amended, carried.

Motion, that the Committee report having passed the bill with amendment, carried.

Motion, that the Committee report having passed the following bills without amendment, carried.

A bill, "An Act To Amend The Taxation of Utilities and Cable Television Companies Act." (Bill No. 51)

A bill, "An Act To Amend The Mineral Act And The Mineral Holdings Impost Act." (Bill No. 21)

MR. CHAIRMAN: Bill No. 35, "An Act To Amend The Hydro Corporation Act, The Electrical Power Control Act, 1994 and other Acts."

The hon. the Member for Green Bay.

MR. HEWLETT: Thank you, Mr. Chairman, not wishing to unduly impede progress before our Christmas break but this is a major bill and it deserves a few remarks in passing. There was obviously some considerable debate, at an earlier stage in this bill, some acrimonious debate I suppose at one time that caused my exit from the Chamber for a short period of time, Mr. Chairman, in a difference of opinion with the hon. the Premier as to the exact meaning of this bill.

Mr. Chairman, this bill basically brings about certain structural and procedural changes with regard to Newfoundland and Labrador Hydro, to a great extent changes of mandate and as well, put certain financial obligations on it that ultimately will drive the Hydro Corporation to the Public Utilities Board and thereby seek a rate increase. The only place they can get the increase of course, Mr. Chairman, is from the ratepayers in the Province.

Now the hon. the Premier has contended that this bill is simply routine housekeeping, some minor structural and procedural changes with regard to Hydro but, Mr. Chairman, there are a number of significant parts that would, in effect, cause some significant costs to Hydro. For instance, the assumption by Hydro of its pension plan and the associated unfunded liability, the amount of the unfunded liability being assigned to Hydro, the length of time over which it is amortized will directly impact on a degree of financial impact but, Mr. Chairman, one way or the other, it is a financial impact that Hydro will have to absorb and eventually pass on to the ratepayers. Changing Hydro into a rate of return basis, as is the case with regard to a private utility, Newfoundland Light and Power, will increase the burden on Hydro to have a higher rate of return. Its rate of return is currently much lower than that of Newfoundland Light and Power and the increased rate of return just from the normal instance of making it a corporation similar to Newfoundland Light and Power will enforce a cost on Hydro that it will have to pass on to the rate payers.

In addition to that, Mr Speaker, the government of late in Budget measures has been making increasing demands on Hydro with regard to greater returns to the treasury from its activities. I believe there was some $20-odd million in this most recent Budget year, and there is nothing to stop this process from continuing and escalating in years to come, so it is quite possible that next year's Budget could see Hydro being required to pony up $30, $40, or $50 million, or whatever, to the Crown, all of which will have to be extracted from rate payers. What this boils down to, Mr. Chairman, is using Newfoundland and Labrador Hydro Corporation as a cash cow, a mechanism to raise taxes on the people of the Province of Newfoundland and Labrador in an indirect manner without taking the political heat for doing that sort of thing up-front.

Mr. Chairman, I think government has an obligation to be honest and straightforward with the people of the Province, and if to redress certain budgetary problems it requires additional revenues, then it should lay it out man-fashion, if you will pardon the phrase, to the people of the Province, that we need more revenues, we want to increase your taxes or consequently we want to greatly lower your level of service. Let us know one way or the other what you want, but in this particular case we have a government doing through the back door what it does not have the nerve to do through the front door.

Mr. Chairman, the other thing that has been alluded to with regard to this bill - it is not directly in it, has to do with the Premier, again, recently, stated belief that Newfoundland and Labrador Hydro would best be privatized. The Premier does not have a mandate from the people so to do and it is unlikely that he will get one in the near to medium term so to do either, Mr. Chairman. The Premier nonetheless is persistent in this, and the changes in the structure and procedures of the Hydro Corporation that will come out of this particular bill makes it very much like a Newfoundland and Labrador Power Corporation with the exception basically that the shares are owned by the Crown.

It is only a matter of time when some future government, if not this government, when strapped for cash decides to sell off all their part of the shares as a fund raising initiative and the people of Newfoundland and Labrador will be faced with the fact that Newfoundland and Labrador Hydro in some sort of budgetary crunch in the heat of the moment is gone, Mr. Chairman, and there is not much they can do about it.

Overall, Mr. Chairman, this appears to be indicating a major change in the role of the mandate of Newfoundland and Labrador Hydro. It is no longer a corporation owned by the people of Newfoundland and Labrador with a mandate to develop hydro electric resources and to deliver hydro electric power to the citizens at the most cost efficient rate. It has become, Mr. Chairman, a mechanism for the government to obtain revenues through indirect taxation, and it has become a possible revenue raiser itself through its own sale should the government so wish to do that in the future.

The amendments in this bill certainly pave the way for privatization at some future date and in the short to medium term, Mr. Chairman, the amendments in this bill will impose costs on Hydro that will indeed have to be passed on to the taxpayers of Newfoundland and Labrador through rate increases. The government does not have the nerve to raise taxes so it is doing through the back door what it does not have the nerve to do through the front door.

Thank you.

MR. SPEAKER: The hon. the Leader of the Opposition.

MS VERGE: Chairperson, the Member for Green Bay, our energy critic, has put very succinctly the reasons why this bill is insidious. This bill contains provisions which will be harmful to the Province in the medium to long-term. It contains provisions which the minister, the Premier, and members of the government are trying to camouflage. In fact the Premier himself denied on public television that this bill will have the effect of increasing electricity prices. Clearly, Chairperson, whatever else this bill does -

MR. CHAIRMAN: Order, please!

MS VERGE: - it will certainly increase significantly electricity rates.

Chairperson, the bill, for a start, will lead to the proclamation of the Electrical Power Control Act. That measure will shift $8 million a year of the remaining rural subsidy from industrial customers to households, to be phased on to household rates over the next four years. That is $8 million a year that will be added to domestic consumers by the end of 1999.

The bill goes on to set out a provision authorizing the Cabinet to order the Public Utilities Board to use a different method for determining Hydro's profit. The Public Utilities Board makes an assessment of Hydro's cost, but beyond that the Public Utilities Board has allowed a margin for Hydro, which is sometimes referred to as Hydro's profit, and that works out to roughly $20 million a year now. The change will authorize the Cabinet to order the Public Utilities Board to use the same method for calculating Hydro's profit as the PUB has used all along for assessing Light and Power's profit. It is the rate of return basis for setting rate structures. That would effectively double the profit earned by Hydro, which can be used either to build up the government's or the people's equity in Hydro, or it can be rated by the government continuing to take dividends from Hydro, as the government began doing in March of this year.

Chairperson, that change would add roughly $20 million a year to electricity rates. It would be loaded by order of the PUB in assessing Hydro's rates, and then would be factored into the PUB calculation of Light and Power's rates, which obviously would then be paid by you and me, by domestic consumers as well as business consumers in the Province. Then, the cost that the PUB calculates under these amendments would be augmented because the amendments direct the PUB to factor into cost the unfunded liability of the Hydro workers' pension benefits.

We didn't get a clear answer to our questions about the extent of the unfunded liability. At one point I believe the minister said that the unfunded liability is about $25 million. During this committee stage of detailed consideration I would call upon the Minister of Natural Resources - I hope the minister is listening - to lay out in some detail the financial position of the Hydro workers' pension plan. Just what is the liability at present? What assets are available now to be applied against that liability, and what is the shortfall? Whatever the shortfall is, whether it is $25 million or whether it is $100 million, under these changes it will be built into the PUB's calculations of Hydro's costs, and loaded onto rates over the next fifteen years and, Chairperson, that is a substantial increase.

Finally, there are provisions of this bill having to do with the method of depreciation which the PUB and Hydro use in calculating rates, and with regard to Hydro's bonds that are denominated in foreign currencies, together meaning higher rates. So there are four or five provisions of the bill which will quite substantially increase electricity prices in the Province.

AN HON. MEMBER: (Inaudible).

MS VERGE: I say to the Minister of Works, Services and Transportation, because he and his colleagues are putting these amendments to the Hydro legislation and the Electrical Power Control Act through the House of Assembly, next year and in five years time the people of the District of Port de Grave will be paying higher light bills than they are paying right now. One of the minister's legacies to the people of Port de Grave will be higher light bills.

The minister and his colleagues in their first several years in office have already made several moves that have added to the cost of electricity in the Province. I would refresh members' memories by pointing out that in their first year in office, they began charging Hydro a loan guarantee fee, and that works out to about $10 million a year. Then, Chairperson, over a period of three years, they phased out the $30 million government subsidy to Hydro for rural consumers. Last March when they were pretending not to raise taxes, they took $20 million in dividends from Hydro. A couple of weeks ago in the mini-Budget when they claimed not to be raising taxes, they took another $2.9 million in dividends from Hydro. That is $22.9 million taken from Hydro this year.

Of course, what the government is doing is eroding the people's equity in Hydro and that is going to sooner or later necessitate additional borrowing by Hydro. Of course, the cost of that additional borrowing will be factored into the PUB's calculations of Hydro's cost and will be passed on to the consumers in the Districts of Port de Grave, Port au Port, Carbonear, and all the other districts across the Province.

The Member for Green Bay and others on this side have accused the government of using Hydro, in the short term while the government still owns Hydro, as a cash cow, essentially using Hydro to collect higher taxes. Of course, because of the chain relationship, it is Light and Power which will be sending out the higher bills. I suppose the minister and his colleagues believe that by the time the people get higher light bills they will forget that the minister and the other members of the Liberal Administration caused those electricity price increases.

Well, Chairperson, we will be here to point out to people that it was indeed the Minister of Works, Services and Transportation who put up the light bills, it was indeed the Minister of Municipal and Provincial Affairs who not only raised electricity prices but forced up municipal taxes. So it is completely wrong and misleading for the Premier to get on television and say that this bill has nothing to do with electricity prices.

After he made that statement he caught himself and went on to try to claim that the measures won't directly increase electricity -

AN HON. MEMBER: (Inaudible).

MS VERGE: The fearless leader of the minister, the Premier of the Province. The Premier made a statement on television which was just plain wrong, and the Member for Kilbride is serving a penalty today for calling that for what it was. It was wrong.

The Premier himself realizes that it is wrong. The Premier knows the difference. He did try to partly salvage the situation by adding in his television interview that this bill will not directly increase electricity rates. That is really stretching the truth. The bill, clearly, by bringing in the Electrical Power Control Act, will directly jack up domestic rates by $8 million a year, phased in over the next four years.

The other changes, you can argue, will indirectly increase electricity prices and very substantially increase them at that. We are looking at, altogether by the year 2000, an extra $30 million or $40 million on electricity rates, the rates that will be charged ordinary householders as well as businesses in the Province. But, Chairperson, this is a serious matter for people of the Province, who are stretched to the limit and beyond now, trying to meet the tax demands of governments.

Now, the price increase is not the only consequence of this bill. The price increase is an obvious and a significant result of the bill, but there are other results which are quite insidious and quite significant. This bill will fundamentally alter Hydro's mandate and will change the relationship between Hydro and the government, between Hydro and the Public Utilities Board, between the Cabinet and the Public Utilities Board. The bill basically, has a number of provisions which will make Hydro look more like a privately-owned corporation and some of the language is calculated for that effect.

For example, in one of the initial clauses, the substitution for Lieutenant-Governor in Council of the word `shareholders'. Well, I ask the Minister of Works, Services and Transportation, why is that change being made? Then, there is the provision which gives the Cabinet the power to order, to instruct, to require the Public Utilities Board to make major changes in the way it calculates rates for Hydro and for other utilities. I don't know if the people at Newfoundland Light and Power are aware of the provisions of clause 16 of this bill, but the phrase, `public utilities' is used. So the Cabinet power to direct the Public Utilities Board is not specific to Hydro; it addresses all public utilities, and that would surely mean Hydro but, in addition, Light and Power.

Chairperson, one of the more startling provisions is the clause that takes away Hydro's exclusive right to develop remaining hydro-electric sites on the Island. I have questioned the Premier about this. His explanation is not at all satisfactory. Basically, the Premier is persisting in claiming that Hydro should be privatized. He continues to assert that it is in the public interest to privatize Hydro.

Now, when it suits his purpose, he acknowledges that massive public opposition caused him to back off a year or so ago. Now, he didn't say that at the time. At the time, when pressured by the former Leader of the Opposition in a television debate, he said on Province-wide television that he would not proceed to privatize Hydro against the clear wishes of the majority of the people of the Province.

Well, Chairperson, he did persist and then he tried to tell people that they didn't know what they were talking about, that they were emotional, that they really didn't understand the situation, and he talked about proceeding regardless of public opinion, or he tried to interpret public opinion in a subjective way. Even when objective public opinion polls showed that the vast majority of Newfoundlanders and Labradorians were dead set against Hydro privatization, the Premier kept it up. It wasn't until Paul Martin's budget last winter when the Federal Government rebate to the Province of private utilities income tax was cancelled altogether, something that had been warned against by members of the Opposition, myself included, and other opponents of privatization, did the Premier finally yield, did the Premier finally say that privatization was off. Well, many of us believed the Premier then, and thought finally the issue was behind us, finally we could breathe easy and count on public ownership of Hydro and the benefits that come from Crown ownership of Hydro for the future.

Chairperson, when we were landed with this bill less than two weeks ago, when we first saw it on Thursday, December 7, we began to have doubts. The provisions of this bill in taking away some of the price differential, some of the rate differential resulting from private ownership of Hydro versus public ownership, the provisions that cancel Hydro's monopoly on developing remaining sites, the provisions that set up Hydro more like a private corporation and distance it from the government, all arguably are calculated with the ultimate aim of another government move to divest itself of Hydro.

That is what we in the Official Opposition have a duty to point out to people of the Province. Yes, in the short to medium term the bill will result in higher electricity prices; yes, those changes will have the result of boosting Hydro's profit and making it possible for the government to take more and more money out of Hydro as the government started doing over the last couple of years, as the government did this year, by taking dividends. Those are two significant implications of this bill, but what more is intended?

I ask the Minister of Works, Services and Transportation who is responsible for tabling exceptions to the Public Tender Act in this House, who sometimes tables exceptions made in Hydro contracting, why is the government through this measure exempting Hydro altogether from the requirements of the Public Tender Act? That just does not make sense. Hydro is an extremely large Crown corporation. It is perhaps the largest. Hydro, just in maintaining its present plant and equipment, has to maintain a large capital works program. There will be future developments which, had Hydro's mandate been left intact, we could have counted on Hydro carrying out. Therefore, Chairperson, surely it is in the public interest to keep Hydro subject to the requirements of the Public Tender Act.

One of the main purposes of the Public Tender Act is to prevent corruption, to prevent repeated episodes such as the Trans City Holdings hospitals scandal. Even with the Public Tender Act applying to the Departments of Health and Works, Services and Transportation's contracts for hospital construction the government manoeuvred and contorted to do a corrupt deal at significant cost to the taxpayers. Because of the Public Tender Act that corruption was exposed for what it was by the Supreme Court of Newfoundland and the government will have to pay a penalty. Sad to say, the penalty will not come out of the pocket of the Premier or the other ministers responsible. Unfortunately, that penalty will have to be borne by the taxpayers of the Province.

Well in the case of Hydro how can people possibly trust the government to have Hydro carry out contracting in a fair and just way, in a way that is going to result in the best value for the people of the Province, in a way that is going to provide a fair and even opportunity for all business people in the Province? The danger of exempting Hydro from the Public Tender Act is that some business people will be favoured while others will be penalized. Perhaps the business people who advertised in the St. George's Liberal barbecue booklet of the Minister of Fisheries, Food and Agriculture will be favoured, perhaps the businesses which contributed to the campaign of the Minister of Works, Services and Transportation will be favoured while firms which have ties with other political parties will be penalized and that is one of the real dangers of exempting Hydro from the Public Tender Act.

Remember, as long as Hydro is a Crown corporation, even with the provisions of this bill, in effect, the Cabinet will appoint the directors of Hydro and through the directors will be able to manipulate Hydro's tendering and contracting practices. So, Chairperson, people will not rest easy with Hydro being taken out of the Public Tender Act. No legitimate public policy argument has been advanced by the Minister of Natural Resources or by the Minister of Works, Services and Transportation or the Premier for removing Hydro from the Public Tender Act. Chairperson -

MR. CHAIRMAN: Order, please!

MS VERGE: Thank you, Chairperson.

This bill has demonstrably negative consequences for the Province, for ratepayers and for taxpayers, for businesses and for householders. Not all of the provisions of the bill have been thoroughly studied, analyzed or are properly understood by the public in the Province and Chairperson, many, many people in Newfoundland and Labrador are concerned about this matter.

MR. CHAIRMAN: Order, please!

I would ask hon. members to my left if we could have a little bit more self control, please.

The hon. the Leader of the Opposition.

MS VERGE: Chairperson, I am going to yield to my colleague, the Member for Ferryland, who wants to have a few words on this bill before we adjourn for this afternoon. I have some other remarks that I will come back to later. Thank you, Chairperson.

December 19, 1995        HOUSE OF ASSEMBLY PROCEEDINGS          Vol. XLII  No. 79A

[Continuation of Sitting]

MR. CHAIRMAN: The hon. the Minister of Industry, Trade and Technology.

MR. FUREY: No, we moved earlier today, Mr. Chairman, that we not adjourn at 5:00 p.m. So there is lots of time. The hon. leader could carry on.

MR. CHAIRMAN: The hon. the Member for Ferryland.

MR. SULLIVAN: Thank you, Mr. Chairman. I do not have a problem with it, if we want to stay here until 12:00, 1:00 or 5:00 or whatever.

AN HON. MEMBER: (Inaudible).

MR. SULLIVAN: No, I just had a few comments. I asked the Minister of Justice a question the last day and he did not answer it. I had a question pertaining to this and maybe the Minister of Natural Resources might be able to answer part of it. He was going to answer it when he closed second reading he told me but he probably forgot. I am not sure, I only reminded him five times in the last five minutes.

Anyway the Minister of Natural Resources in response to the question I asked, by setting up a Hydro pension fund now or a separate fund, there was a $1.2 billion liability in the public service pension fund. The minister indicated there is roughly 1,000 - it was not in Hansard, off the record type - approximately 1,000 employees with Hydro and we are going to transfer what is in the public service pension fund, an amount that is roughly $25 million that Hydro is going to assume of the unfunded liability in the provincial public service pension fund. It is going to now be allowed, over the next fifteen years - that is in clause 7.3(d) - over the next fifteen years Hydro is going to have to recover that unfunded liability over the next fifteen years which means they got to do it one of two ways - to recover $25 million over fifteen years - nothing wrong with it. In fact there are certain positive aspects to that and I want to get to a question shortly. I just want to set the picture first of what is happening before I ask a question on other aspects of it.

Over the next fifteen years it is going to cost roughly $47 million dollars to amortize that $25 million which means that Hydro is going to have to come up with an extra, over fifteen years, $47 million either in increased efficiencies in operating that corporation or by increasing the rates to consumers of electricity in the Province. How they do it, I say to the minister, is one of two ways. If you need to get $47 million you raise rates or you get efficiencies in the system. I am indicating - and nobody here can answer that. I know the minister cannot answer that - that is something that the new Hydro board is going to have to do. Number one, I would assume they will try to find it in efficiencies in the system. If they cannot find $47 million in efficiencies over that period of time they will have to go to the Public Utilities Board for a rate increase, basically that is what is going to happen.

Now, with reference to that, I ask the minister, what about Hydro employees who have retired? Those who might be drawing a pension for the next ten, fifteen, twenty or thirty years? Is the Province going to assume the unfunded liability on those pensions or is Hydro going to pick up, in that $25 million, the unfunded liability for people who are already retired and drawing pensions? Hydro will assume the total unfunded liability based on the percent of their contributions and the unfunded liability in the plan on a sort of pro rata basis and amount.

AN HON. MEMBER: Hydro (inaudible) employees and its pensioners.

MR. SULLIVAN: Its employees and its pensioners would be transferred. So which means that basically all the unfunded liability, that was gathered over the years by Hydro employees are really employees of this Province under the new arms length commercialized operation. Now they are going to be picked up within the structure of Hydro, all this unfunded liability. Is that correct? Okay, that is the question I wanted to get answered and I certainly thank the minister for that. We are going to be looking at, I think, and the minister, if they can do their projections roughly, I think $47 million over a fifteen year period, about $3. some million a year would have to be recovered to make up for that point. So I am saying in a fifteen year period we are going to assume that.

Now there are other implications too, I say to the minister, for increased rates and I am not saying in all these instances - how they deal with it - I think the Public Tendering Act is one way that not only allows a level playing field, but it also encourages competitive bidding and has a tendency to keep the cost of doing business down. That is a fact. If you ask for tenders and you get four bids you generally take the lower one, generally speaking - that did not always happen, but generally you do, or a preferred bid - you have a rationale for doing something.

In this instance the Public Tender Act, by not applying there, has a tendency, I say to the minister, to increase rates. Now that has a tendency to drive up the cost of contracts, because if you had four bidders on a contract, I would think, whether it is snow clearing or whether it is removing equipment, whatever it is, by having more bidders, a more competitive process, you have a tendency to get a lower bid. That should save that company money and should enable it to operate more efficiently and keep the rates down.

I am saying that is one thing that has implications to increase rates to consumers. It has implications, and for anybody to say the public tendering process drives up rates, or keeps them the same, I don't think that is founded on logic; but I will leave that point there, brought to the minister's attention.

Also, there are other implications here that have a tendency to affect the rate structure. Whether they will, too, I say to the minister, that is something that has to be determined, but there are implications to drive it up, not down. Public tendering would drive it up. Guaranteed, the Hydro - the unfunded liability - has a tendency to drive up rates, because you cannot continue to find efficiencies. You can only get an organization or a company so efficient, and then you have to start cutting essentials or driving up rates, or increase revenues.

Also, another area which has a tendency to increase rates on the whole is the rate of return. As a business that is out there, as a commercialized operation, has a certain rate of return, now the powers are going to be retained here to give it directives, I think are the words used. I just don't have the exact words in front of me, but I think give direction or policy are the two words, if I remember correctly, direction and policy to the utilities board.

They might say: Well, we only want a 6 per cent or 7 per cent rate of return. That is the direction -

AN HON. MEMBER: Who?

MR. SULLIVAN: Government, as we are getting now. The minister knows what I am talking about. The Minister of Works, Services and Transportation is trying to interrupt the process here. I think there are valid points here, I say to the minister, and he is listening, and I appreciate that.

They may give a direction to maintain the current structure, or they may give a direction to give us back - we want more money now, and we want to get back an increased return for guaranteeing the debt, or whether it is the 22.9 we got this year, that is about $33 million to get back, directions can go - if the Province wants to use that as a little bit of a cash cow to get us more money, that can be done there, but the direction and the policy will have to come from government; but if you are going to allow it to operate as sort of at arm's length, like a private type operation there, would it be fair, I say to the minister, to allow that to compete in a marketplace with a rate of return that is less than normal for that type of business? I know we are the shareholders, and we are willing to live with it to keep rates down. That is a choice that government will have to make in due process, and on an ongoing basis they have to make. They made it in the latest budget thing when they went back and looked for more money out of dividends.

When you take more money out of dividends, I say to the minister, even though our debt to equity ratio, I think, went from eighty-three to seventeen, ratio to eighty-one nineteen, I think roughly now, still what happens when you use your profits and so on to increase equity, to pay down debt, if you take extra funding out now in dividends you have less dollars there to reduce debt, and build up equity there. You cannot have your cake and eat it too. If we sacrifice what we take in dividends, the $22.9 million we are taking in dividends, it is going to certainly slow down the process by which we are going to try to get to what a normal functioning company in a debt to equity ratio - we want to realize the area - which is, I think they talked about what, in the 60/40 range, approximately, to compete out in a private marketplace. There are decisions that you have to make that could affect overall operation on what we are going to take out of rate users in the Province compared to the taxpayers of the Province. Those are the decisions that have to be made in Cabinet now, made through the minister, directions that are gone out to the Public Utilities Board.

Just one other point I would make and then I will stop. I don't want to unduly prolong it at all. I think there is also a shifting in industries in rural Newfoundland. A shifting of roughly $8 million is the figure that it is going to cost now. We are going to take it from industries. That is a decision that has merit. Some merits there. Are the consumers going to pay, or should the businesses pay? Should it be on a basis of consumption that you are going to use? They are policy decisions and directions, things that the government has to do, but there are certain implications. There is a shifting base in which where are you going to collect your revenues for Hydro now?

This $8 million is going to come out of the residential consumers of electricity now as opposed to the rural industrial users of electricity. That is basically a shifting of $8 million from one pot to another. The regular household rates are going to have to increase. Because if that is not going to happen to consumers, that $8 million, we are going to have to get another $8 million in efficiencies, if we aren't going to charge it to the residential consumers. That is another $8 million on top of the $47 million for the unfunded liability. I mean, we have $55 million.

We have implications too. The tendering process could affect us, so we have to find a fair chunk of money to enable that company to operate. By having up to 38 megawatts, I think, was the amount of power on a private developer of power, is setting a stage out there to allow other people to develop the resources on a competitive and private basis here. We are moving a company here out into the private stream, Newfoundland Hydro there, when it is serving a public interest there. To keep it at arm's length is one thing, but to completely sever the ties with it where we lose control over the rates that consumers pay here in the Province and control over the operations of Hydro is another question also. They are things that are major decisions, major things.

Certainly we are moving in the direction of a private company. Legislation is moving it in that direction. What the final analysis is, it would make things very convenient - and there is no doubt about it - to achieve certain things that the Premier tried to achieve before. What his motives are, what the government's motives are, that is something I will leave for speculators. But the facts as they are there, it is moving into a private stream and there are serious implications here for increased rates to users here in this Province. Thank you, Mr. Chairman.

MR. CHAIRMAN: The hon. the Member for St. John's East.

MR. HARRIS: Thank you, Mr. Chairman. I want to say a few words at this stage of the consideration of the Hydro Corporation act and the act amending that act and a number of other acts of this Province.

We have had some debate on the purpose and intent of government here in putting forth this legislation. Essentially the debate has centred on two issues. One is whether or not the changes that are being made to the Hydro Corporation and the other changes to certain other acts and regulations are going to lead to higher rate payments by consumers of electricity in the Province, whether they are direct consumers obtaining their domestic or industrial electricity directly from Hydro, or whether they do so through the other power distributor in the Province, Newfoundland Light and Power Corporation. That is the first issue.

The second issue is whether this is either an act which attempts to put us on the road to privatization of Hydro, or in fact is an enabling act which would allow Hydro to be privatized without further reference to this House.

I think the answer to the first question has been demonstrated to be: Yes, it will of necessity lead to higher Hydro rates in this Province. The several provisions that have been alluded to would have the effect: of changing the accounting methods, the depreciation methods; the addition to the expenses chargeable to the operating account by the Corporation designated to include the liabilities of the Corporation under the Hydro Pension Plan assumed under an agreement to be negotiated with the Minister of Finance and Treasury Board; the foreign currency obligations under clause 7(3)(b); and the maximum thirty-eight megawatt generation of power and the amounts to be paid by the corporation for them, all of which are to be amortized with the exception of (c) over various periods of time.

The Premier has stated that the purpose of these amortization periods is to prevent any increase in Hydro rates. That seems to me, Mr. Chairman, to be sheer nonsense. The fact that you have to amortize a mortgage, for example, over fifteen or twenty or twenty-five years doesn't save you from having to pay it. In fact, the longer you amortize your mortgage the more you pay. Instead of paying for five or ten years you are paying for fifteen or twenty years. Of course, in addition to paying the costs you are also paying interest over a longer period of time. It is pretty clear that there would be an additional cost to the rate payer of Hydro for looking after those particular amounts that are now on the books of the Province.

In addition to the pensions amounts that are established here there are costs to the Corporation, or rather not to the Corporation but to the individual or domestic rate payer for the adjustments to the industrial rates, so as to provide a situation where what is currently alleged to be a subsidization by industrial rate payers of domestic, to be removed. That obviously is going to increase the costs of power to the domestic consumer: again, whether it is a direct domestic consumer from Hydro or one who receives his power through the Newfoundland Power distribution system. The answer is clear, I think, that that would have the affect of increasing power rates.

The second way in which the power rates can increase as a result of this act has to do with the power that the Cabinet has given itself or held for itself which is to give directions to the Public Utilities Board as to the manner in which the power rates are to be established, and not only the manner in which it is to be established but also, the ratio of debt equity which the corporation will be permitted to hold. So if the Cabinet by virtue of its power either as Cabinet or as directing the shareholders through presumably the Minister of Finance and Treasury Board, there could be a change in the share structure or establishment of the share structure for Hydro, and a direction to convert some of the existing debt into equity and the only way I could see that as being done is by the issuing of shares.

The interim step to that may be a direction from Cabinet to the Public Utilities Board to start dealing with Hydro and the rate base of Hydro, on the basis not of an investment cost for an interest cost plus a cushion, which is the way it is now, but on the basis of a rate of return on equity in addition to the interest cost and one that is equivalent to what is obtained in the private sector, something in the order of 13.5 per cent instead of the approximately 6 or 7 per cent which is the total cost now of the assets of Hydro, in terms of what is added to and what is deemed to be required to be returned by the Public Utilities Board from the rates, so by changing the rules of the game as it were, the Cabinet is empowered to increase the cost of Hydro electricity in the Province to domestic and industrial consumers.

Now I guess the minister will probably say well we already have that power now and that is true, the government has that power now. The interest in using that power or the temptation to use that power however, is enhanced by this act. The government is trying to establish Newfoundland and Labrador Hydro as the equivalent to a private corporation, to act like a private corporation, to invest itself with a corporate culture that is related to a private corporation and not a public corporation, and the temptation is there and clear, that the Cabinet's next move will be to give instructions to the Public Utilities Board to establish -

AN HON. MEMBER: (Inaudible).

MR. HARRIS: Yes, plane reservations are pretty tight, this time before Christmas.

AN HON. MEMBER: (Inaudible) going home for Christmas boy, he wants to be home with his family.

MR. HARRIS: So, Mr. Chairman, the next step I would see happening would be instructions to the Public Utilities Board to change its approach to the Hydro Corporation's rate of return to again increase the private nature of the corporation and to take away its public nature.

That is the second part of it. We are getting into the second part now, so what else is going to increase the rates? We have the add-ons for the cost, we have the secondary aspect where the Minister of Finance and Treasury Board and the Cabinet can give directions to the Public Utilities Board and we have the other provisions which basically denude the Hydro Corporation of its public purpose, of its public policy purpose, Mr. Chairman.

When we had the Hydro debate about the privatization of Hydro last year, one of the underlying themes was the nature of Hydro as a public corporation and its role in the economy of Newfoundland and Labrador and the future of Newfoundland and Labrador. At that time, comparisons were made to Hydro-Quebec and the role that it played in the development of not only the power resources of Quebec, but also the expertise, the engineering expertise that has seen the Quebec engineering fraternity turn itself into world leaders in consulting engineers with large corporations such as S & C Lavalin and others, doing business all over the world as part of the resulting activity from the use of Hydro-Quebec as what has been called by others and by the Globe and Mail for example, as the engine of economic growth in the Province of Quebec, so we talked about that last time, how the role of the Hydro corporation could be, should be and to some extent has been, an engine of economic growth in the Province and a place where engineers and others can develop and use the expertise in engineering, consulting and other fields with a public purpose in mind.

We talked about the mission statement of Hydro which according to its annual report of 1993 I believe, was set forth as being to deliver, produce electricity to the people of the Province at the lowest possible cost consistent with the safety of its employees and consistent with the - I can't remember the full quotation right now, Mr. Chairman, but generally speaking, the mission statement was involved in the public purpose of the corporation. The public purpose of the corporation had to do with the provision of energy to the people of this Province at the lowest possible cost, Mr. Chairman, consistent with public safety and the safety of its employees.

Now we see the public purpose of Hydro being shorn from its objects, its public purpose power such as the primary actor in hydro development in this Province, that has been taken away; its right to expropriate, subject to Cabinet's approval, lands for hydro purposes and for hydro lines for power generation and transmission, that has been taken away from it; taken away the Provincial Preference Act which is designed obviously to continue to generate economic activity in this Province, taken outside the Public Tender Act, what public purpose is served in that, Mr. Chairman? What public purpose is served in taking it outside the Public Tender Act?

We have seen what a mockery of the Public Tender Act this government has made over the hospital clinics, we have seen what a mockery was made of that. Is the government so embarrassed by that that they want Hydro to carry on its tendering activity in giving business without the constraint of the Public Tender Act, so that there will be a free hand by the directors of Hydro, who are appointed by this government to carry out their tendering and contracting activities without even that overseeing of proper purpose, of proper tendering procedures, which were designed after all, to ensure that the public of this Province is protected from two things: number one from paying a higher price for contracting activity than they ought to in the market and secondly, and just as importantly, to prevent the temptations of corruption, Mr. Chairman, to prevent governments and individuals from seeking to advantage their friends - their political friends, their social friends or any kinds of friends or associates with whom they may be involved. Those two purposes are achieved by a proper operation of the Public Tender Act, Mr. Chairman, not increased costs; you merely have to call for tenders and to give the tender to the lowest bidder who is capable of doing the job. Obviously, there is an evaluation process involved but that is involved in any tendering process.

What is the purpose, what is the public policy purpose of taking Hydro out of the Public Tender Act? The Crown Lands Act and the special treatment that Hydro received under the Crown Lands Act is removed. The Freedom of Information Act: Why is the public going to be no longer able to ask questions under the Freedom of Information Act with respect to Newfoundland and Labrador Hydro? It is still a Crown agent, according to section 3 of the Hydro Corporation Act, it is still an agent of the Crown, Mr. Chairman, and still an operating arm of this government, and yet the minister, in this legislation, wants to ensure that the public does not have entitlement to information about the activities that it now has.

All of these changes denude the Hydro Corporation of its public policy purpose and pave the way for privatization of Newfoundland and Labrador Hydro. The government has said and the Premier -

AN HON. MEMBER: (Inaudible).

MR. HARRIS: That's right. If I were him, I would not have sent -

MR. SULLIVAN: (Inaudible) yourself.

MR. HARRIS: I say to the Member for Ferryland, if I were the Premier, I would not have sent him to Ottawa to get a job for me.

MR. SULLIVAN: Frankly, I have better (inaudible) let him keep the job for himself.

MR. HARRIS: But this legislation, Mr. Chairman, is legislation that has the effect of paving the way for privatization and I can accept what the Premier says, that they don't have a present intention of privatizing Hydro, they have a long-term intention of privatizing Hydro, a past intention, a desire to privatize Hydro, and they think that at some point, in perhaps the not distant future, they will be able to privatize Hydro because the climate of public opinion may momentarily change and they feel that they can get away with it.

Alternatively, Mr. Chairman, they will do as the Opposition Leader has suggested and that is, that they will change Hydro so drastically that people will wonder why they would want to keep it as a public corporation anyway because it is acting just in exactly the same way as any other private corporation. So by taking away the public policy functions of Newfoundland and Labrador Hydro, they will have achieved through the back door, what they could not achieve through the front door because the public of this Province were on to them.

This is public policy by stealth, Mr. Chairman, this is an end run on public opinion, an opportunity to outflank the will of the people of this Province by seeking to change the nature of the Hydro Corporation and then to pull the plug by either having a partial share offering or a full share offering to totally privatize it. I don't see, Mr. Chairman, why the government would have clause 9 in the bill and clause 2 in the bill if they did not intend to actually establish a shareholder and shareholder structure at some point in the not-to-distant future. The shareholders, by special resolution, are now empowered to give directions to the board, are now empowered to appoint a chief executive officer of the board, are now empowered by special resolution to establish share capital in the amounts and consistency of those common shares with or without par value and preferred shares with the rights, restrictions, privileges, conditions, etcetera, that the shareholders may consider desirable. Why is that there, Mr. Chairman? What is the purpose of that if it is not to enable the establishment and issuing of shares of the corporation to raise equity through a public offering? Whether it is an agent of the Crown or not, I do not think that this bill and the amended Hydro Corporation Act would prevent the raising of private capital for preferred shares of Hydro as part of a public offering and then give directions to the Public Utilities Board to fix the rates accordingly to provide a rate of return for that form of equity along the same lines as it does so for Newfoundland Light and Power right now.

So as I see this legislation, Mr. Chairman, it is going to cause an increase in hydro rates, it is going to dramatically transform the Hydro Corporation itself and it is going to lead to the privatization of Hydro. (Inaudible) there is any question about those three issues. The appointment of Bill Wells as the chairman and chief executive officer is a very clear signal that that is the intention of government. This is not a man with a great history of service in the public service of this Province. I am not denying his capability, don't get me wrong. He is a very capable individual, I say to hon. members, but his experience is not in the public service. His experience is that of an individual who is very much tied -

AN HON. MEMBER: (Inaudible).

MR. HARRIS: Absolutely, I would have no trouble telling Mr. Bill Wells, face to face, that I regard him as a very competent individual but that his experience is in the private sector, that his whole history of professional life is also in the private sector and that he does not have that experience in the public service and the public sector that a public corporation such as Newfoundland and Labrador Hydro should have, based on the public policy principles and the commitment to the public interest that has been the hallmark of the Hydro Corporation since its inception.

I see this legislation, Mr. Chairman, as having the same effect as the privatization bill that was before the House on the last occasion, then was rejected so resoundingly by the public of this Province.

Thank you, Mr. Chairman.

A bill, "An Act To Amend The Hydro Corporation Act, The Electrical Power Control Act, 1994 And Other Acts." (Bill No. 35)

On motion, clauses 1 through 15 carried.

MR. CHAIRMAN: Shall clause 16 carry?

The hon. the Government House Leader.

MR. ROBERTS: The amendment to clause 16 is to replace the following words - and the words are found in the fifth line of the new 5.1 - the words to be replaced are, `the determination of rates of public utilities,' and they are to be replaced with these words, `the determination of rate structures of public utilities.' In a brief sentence, the word `rates' is being replaced with the words, `rate structures.' The distinction is an important one, as members will appreciate, and we believe it is an appropriate one, so we are moving it on that basis.

I understand members opposite have been provided with copies of the amendment, so they can address it as they wish, but I would move it, Mr. Chairman.

On motion, amendment carried.

On motion, clause 16, as amended, carried.

On motion, clauses 17 through 24, carried.

Motion, that the Committee report having passed bill 35 as amended, carried.

MR. ROBERTS: Mr. Chairman, would you rise the Committee and perhaps we could deal with the amendments that have been made in Committee and then we will adjourn the House for the day.

On motion, that the Committee rise, report progress and ask leave to sit again, Mr. Speaker returned to the Chair.

MR. SPEAKER (L. Snow): Order, please!

The hon. the Member for Bellevue.

MR. BARRETT: Mr. Speaker, the Committee of the Whole have considered the matters to them referred, have directed me to report having passed Bills No. 44, 51, and 21 without amendment, and Bills No. 48 and 35 with amendment, and ask leave to sit again.

On motion report received and adopted.

On motion, amendments read a first and second time, bills ordered read a third time on tomorrow.

MR. SPEAKER: The hon. the Government House Leader.

MR. ROBERTS: Mr. Speaker, in moving the adjournment may I first of all commend my friend and colleague, the Minister of Industry, Trade and Technology.

SOME HON. MEMBERS: Hear, hear!

MR. ROBERTS: He has shown how it is done, so I would be very happy to pass the responsibilities of this office over.

SOME HON. MEMBERS: Hear, hear!

MR. ROBERTS: I say to my friend, the Member for Grand Bank, when he says, `Go back to Ottawa', that I have already done the deal for him. As I told him earlier, when Mr. Doody leaves the Senate, I will put forward his name to replace Mr. Doody. I will be happy to do it. When Doody did it, Matthews can have it - as far as I am concerned.

Mr. Speaker, tomorrow -

MR. W. MATTHEWS: (Inaudible).

MR. ROBERTS: I have to say to my friend, the Member for Grand Bank, the last time I saw Mr. Doody he looked indecently healthy. I am afraid I have to report that. I know my friend will be disappointed by that news. I think Bill Doody brings the same wit and good humour to the Senate that he brought to the House of Assembly in his years here.

Mr. Speaker, my understanding is that after the astonishing progress which was made in my absence, which would encourage me to go again, we have two bills left to deal with at Committee stage. They are, on today's Order Paper, Order 28 and Order 30, the Limitations Act and the Provincial Offences Act. There are minor amendments to both. I will undertake to have them in the hands of the gentleman from St. John's East and my friend from Grand Bank early in the morning. That will then leave us nothing except third readings to be done.

My suggestion will be that we start with the bottom of the Order Paper and we will work our way up.

AN HON. MEMBER: (Inaudible).

MR. ROBERTS: I am sorry?

AN HON. MEMBER: (Inaudible).

MR. ROBERTS: Two more bills before Committee?

AN HON. MEMBER: (Inaudible).

MR. ROBERTS: I am sorry; I misunderstood. We also deal, then, tomorrow in Committee with the Mineral Act and the Medical Act, Orders 39 and 40. I don't know how long it will take us to do that. When that is done, we will move into third readings and we will take them in the reverse order of the Order Paper, but we shall leave the Hydro bill and the Electoral Boundaries bill until last. Now, if that is agreeable, that is the way we shall proceed.

My understanding is that my friend, the Member for St. Barbe, using the conciliatory negotiation skills that he evidences every day in the very successful discharge of his duties, not to mention buying lottery tickets, has made an arrangement with members opposite that tomorrow will be a government day. We shall meet at two and go through the Orders of the Day in the usual way and then we will deal with the business. If we should finish by five tomorrow, dealing with the issues, fine. If not, we shall be back here on Thursday morning, I understand, at ten o'clock and we will adjourn as soon as we have finished dealing with the matters on the Order Paper.

His Honour will attend, then, either tomorrow or Thursday, depending on when the House is ready to present bills to him for assent.

My understanding as well is that part of the arrangement is that tomorrow would normally be an Opposition day, that the next two Private Members' Days will feature the motion made by my friend from St. Mary's - The Capes and then the motion made by my friend from St. John's East. So if that is acceptable -

MR. EFFORD: Is he your friend?

MR. ROBERTS: In the parliamentary sense. I say to my friend, in the parliamentary and non-parliamentary sense, from Port de Grave, that my friend from St. John's East is my friend in the parliamentary sense.

Your Honour, I understand that agreement has the approbation of the members in the House and so we will proceed on that basis.

With that said, I move the House adjourn until tomorrow, Wednesday, at two o'clock.

On motion, the House at its rising adjourned until tomorrow, Wednesday, at 2:00 p.m.