Pursuant to Standing Order 68, Kevin Parsons, MHA for Cape St. Francis, replaces John Dinn, MHA for Kilbride, until 6:30 p.m.

Pursuant to Standing Order 68, Wade Verge, MHA for Lewisporte, replaces Ed Buckingham, MHA for St. John's East, until 6:30 p.m.

The Committee met at 6:10 p.m. in the House of Assembly.

CHAIR (French): Good afternoon, folks.

It is good to be here this evening. We are doing the Estimates, Government Services, for the Department of Transportation and Works and the Newfoundland and Labrador Housing Corporation.

I guess we will start off with the Newfoundland and Labrador Housing Corporation, but before I do there are just a couple of housekeeping things.

If I could have someone move a motion to accept the minutes on the Office of the Chief Information Officer and Public Service Commission.

So moved by Terry; seconded by Beth.

Thank you very much.

On motion, minutes adopted as circulated.

CHAIR: I guess tonight what we will do, before I call the subhead, we will split fifteen minutes each, if that is okay with the members of the Committee. Are you are fine with that, Minister?

MR. TAYLOR: (Inaudible).

CHAIR: I said, if you are fine we are just going to switch fifteen minutes each on questions. What I will do is call the subhead. When I call the subhead, then I will get you to introduce your Committee.

Another thing: Before you speak, if you respond to a question, please say your name so that the communications people know who is talking.

We will do Housing first. I call subhead 1.1.01.

I will ask the minister, if he wants to start off with a few words, please feel free.

MR. TAYLOR: The wrong mike is on.

CHAIR: I will tell you what we will do. We will start with the introductions first.

We will start with Mr. Smart.

MR. SMART: Bob Smart, Deputy Minister of Transportation and Works.

MR. SIMMS: Len Simms, CEO, Housing.

MR. MOORES: Weldon Moores, ADM, Strategic and Corporate Services, Transportation and Works.

MR. TAYLOR: Call Kevin; I think he is having a problem with the mikes.

CHAIR: You have to wait for your lights there, gentlemen.

Mr. Simms just introduced himself, so next to Mr. Simms.

MR. SIMMS: Len Simms, CEO, Housing.

Actually, is that a mike? I thought it was just a recording.

AN HON. MEMBER: It is a mike.

MR. SIMMS: Things have changed.

MR. MOORES: Weldon Moores, ADM, Strategic and Corporate Services, Transportation and Works.

MR. G. ANTLE: Gerry Antle, Assistant Deputy Minister, Transportation and Works, Works Branch.

MR. K. ANTLE: Kevin Antle, Director of Financial Operations, Transportation and Works.

MR. LAWRENCE: Tom Lawrence, Chief Financial Officer of the Housing Corporation.

MR. ALEXANDER: Paul Alexander, ADM, Marine Services.

MR. SALTER: Dave Salter, Director of Communications, Transportation and Works.

MR. GOSSE: Gary Gosse, Director of Highway Design and Construction, Transportation and Works.

MS MOFFATT: Kate Moffatt, Executive Director of Program Delivery & Planning, Newfoundland and Labrador Housing.

MR. WILLIAMS: Kevin Williams, Newfoundland and Labrador Housing, Team Leader, Program Delivery.

CHAIR: Okay, we will do the introduction of the Committee now. We will start with Ms Michael, please.

MS MICHAEL: Lorraine Michael, MHA, District of Signal Hill-Quidi Vidi.

MR. BUTLER: Roland Butler, MHA, District of Port de Grave.

MR. LODER: Terry Loder, MHA, District of Bay of Islands.

MS MARSHALL: Beth Marshall, MHA, District of Topsail.

MR. VERGE: Wade Verge, MHA, District of Lewisporte.

MR. KEVIN PARSONS: Kevin Parsons, MHA, District of Cape St. Francis.

CHAIR: Okay, now we will try this again.

We will start with Newfoundland and Labrador Housing. I will call the subhead, and then the minister can have a few words.

Subhead 1.1.01; shall 1.1.01 carry?

Carry on, Minister.

MR. TAYLOR: All right, now we have the lights working in the right order.

I have to say, when I was on the Estimates Committee I was never terribly enamoured with listening to the minister babble on, and I have been around long enough now that I think I am starting to get tired of listening to my own self talk.

I think everybody is very well aware of the mandate of Housing and, likewise, Transportation and Works. If it is okay, whatever the Committee wants to do is fine with me, but we can move right into whatever questions. This is the Committee's time, not the minister's time. I have lots of time to talk in the House of Assembly, so I defer to the Committee's questions right now, if it is okay with you, Mr. Chair.

CHAIR: Sounds good to me, Sir, believe me.

We will start with Mr. Butler. Mr. Butler you can proceed for ten or fifteen minutes, or whenever you feel comfortable, and then we will move to Ms Michael.

MR. BUTLER: Not a problem. Thank you.

I want to welcome the minister and your staff.

Under subhead 1.1.01., Housing Operations and Assistance, I was just wondering, for instance, how come the sections are not broken down like we see within the other divisions of your department where it shows salaries, employee benefits, transportation and that? It is all under Grants and Subsidies for the full amount there. I was just wondering – I am sure there is an explanation for it.

MR. TAYLOR: By and large - Len will bail me out, I am sure, if I get myself in too much pickle here now - because Newfoundland and Labrador Housing is a body associated with the government, as opposed to within a government department, there is a grant that goes to it, and it is all captured there. They have their own budget and whatever. That is essentially the reason, right?

MR. SIMMS: That is essentially the reason, yes, Minister. The one thing I would add is that a lot of people really, perhaps, are not aware of the size of the total budget of Newfoundland and Labrador Housing. That is because grant funding comes from the federal government. We get revenue from our rent as well, so the total budget of Newfoundland and Labrador Housing is about $140 million. The Province provides a grant now somewhere near $50 million this particular year. That is why it is in a Grants and Subsidies vote because it is strictly that; it is a grant. We use that funding to offset the cost of the operations and build it into an entire budget.

MR. BUTLER: Item 10, Grants and Subsidies, that would include what goes out for various programs, to repair houses, salary, the full thing?

MR. SIMMS: Yes.

MR. BUTLER: It is all listed there.

MR. SIMMS: It is all built into the larger budget.

MR. BUTLER: Having said that, I notice that the estimate for this year is $50 million. I think that is somewhere around $8.5 million over and above last year. I was wondering, could you give a breakdown? I know probably some of that is for the increases in salaries, but could you give me a little breakdown of what the rest of it might be for? Would it be additional funding for the various repair programs and what have you?

MR. TAYLOR: Yes, that would be correct. There is a significant increase this year in funding for repair programs and what have you, both of own stock, so to speak, and of houses that are privately held through the Provincial Home Repair Program. As well, there is increased funding for community centres throughout the Province. I think the number just on community centres alone – correct me if I am wrong, Len - is a $400,000 increase this year. That is all captured in that.

MR. BUTLER: Under 01. under the same heading, where it says Revenue – Federal, I was just wondering, why are you only estimating approximately 30 per cent of what was there for last year? Last year it said $9.2 million, and this year the estimate is $2.9 million. Why the reduction there?

MR. SIMMS: I am not quite sure - what are you referring to again?

MR. BUTLER: Under heading 1.1.01.01. Revenue – Federal, there is a reduction of $7 million, or pretty close to it, from last year.

MR SIMMS: First of all, there is a general reduction in federal revenue anyway to Housing since 1997-1998 as a result of what was then called the devolution agreement that was signed. That is not particularly that item there. That item there is more the Housing Trust Funds that the federal government provided to all provinces a couple of years ago, and most of that funding has been allocated and spent. The $2 million – or, sorry, the two point whatever it was - remaining this year is still money that is allocated but not yet spent. So, it is simply money that was provided to all provinces and territories last year, two years ago, by the federal government at the time.

MR. BUTLER: Under the second heading 1.1.02., under Revenue - Federal again, that is why I guess there is nothing listed there for this year, where there was $1.7 million last year.

MR SIMMS: Correct.

MR. BUTLER: Generally the same.

MR SIMMS: Generally the same.

MR. BUTLER: During last year's Estimates there was an issue discussed about asbestos in many units. I think it was mainly due to sparkling and plastering, if I remember correctly from the minutes of last year, and also around the pipes. I was wondering, have any major concerns come forward this year or have most of those issues been rectified?

MR. TAYLOR: No, there is nothing any different from what we have had before. Normal concerns are still being raised, and we are still dealing with asbestos abatement in a number of our facilities consistent with what you would have seen last year.

MR. BUTLER: Okay.

The new program, the Residential Energy Efficiency Program, I know that came on stream this year and a lot of people were putting in applications. Then there was notification came out that there were only 1,000 applications to be dealt with and that you have to reapply again next year. There is no extension for any additional ones this year, is there, over and above that 1,000?

MR. TAYLOR: No. Basically, when the program was announced there was an understanding that we did not want to get ourselves into a predicament similar to what we had with the Provincial Home Repair Program previously. We did not want to have these long wait-lists, and people waiting for two or three or four years on a wait-list.

The decision was taken that we have our defined budget and we will accept applications up until that budget is utilized. Once we have reached that point there is a cut-off. Then, if people are still interested next year, if the budget is there then they can reapply again as opposed to just sitting on a wait-list indefinitely or for an extended period of time.

MR. BUTLER: The only other question I have with regard to this heading is, I guess, tied to that same program: the issue about the inspections and the audit that have to be done of the homes.

I know there is quite a bit of confusion about it because, listening to some of the information, it states that there is a certain amount of funding to go towards the audit and then I think there is another program through Natural Resources, a similar program. I do now know if it is all tied together, federal-provincial, what have you, but apparently a lot of the people, once they call in to have the audit done, they are getting back to them saying this is how much money is provided but you have to pay the rest of the audit fee. Some people are saying that they cannot afford it. I guess some are in the lower income brackets. I am just wondering, has that been a problem?

MR. TAYLOR: Len will probably have to provide more detail on this but there are a couple of programs here. In one of the federal programs there is an audit requirement, and we identified funding so that people who probably could not afford to have the audit completed could get the audit done so that they could then access the federal funding for energy efficiency upgrades. That is separate from the program that is being administered by – correct me if I am wrong again – Housing on behalf of the provincial government.

Len, do you want to jump in there?

MR. SIMMS: First of all, there are two programs. They are both Natural Resources programs, incidentally. We are delivering the low-income one for the Department of Natural Resources. The one that the Department of Natural Resources is actually delivering itself is a model similar to the one that used to be delivered at the federal level, where they just provided a small amount of rebate to homeowners if they did the energy retrofit.

The new one is for low-income homeowners, householders. What happened there was that we put out an RFP to ask for auditors, people who do this kind of auditing, they are trained in this area, and the best bid was accepted or whatever, and what happens is that we are actually paying for the audit for the low-income person. That is the initial audit, where the auditor goes in and tells the homeowner this is what you need. Generally speaking, for energy retrofit it is primarily focused on insulation in the basement, in the ceiling, the walls. That is where most of your energy loss occurs; I think everybody knows that. Then what happens is the individual gets the funding, arranges to have the necessary work done, the insulation and all of that, and then the auditor goes back a second time at the end of the process and does the audit to make sure that it was done properly, and also gives us a reading on how much energy savings there has been. So it is two separate programs. We are just delivering the one for low-income household, less than $32,500.

MR. BUTLER: So the second audit, that is covered off on the cost for that one as well, is it, for the low-income families?

MR. SIMMS: Yes, we pay for both audits.

MR. BUTLER: I said that was the last one, Mr. Chair, but I have one other one; then you can go to Ms Michael.

When it comes to inspectors who travel to the different areas - I know there are two or three out our way - is there a shortage of those guys now? I know last year they were saying there was quite an area they had to cover. There are no problems with that now that the numbers they have to visit is not out of whack with them, I guess?

MR. TAYLOR: No, it does not appear to be. Essentially, I think one of the bigger problems that we had with Housing over the years is the money for a lot of the work that needed to be done was not there. If you look at the wait-list, for example, now, what we had traditionally referred to as the RRAP program, that wait-list, we made a commitment back two or three years ago that we were going to get rid of the wait-list, put more money into it and get rid of the wait-list over the course of four years. We have essentially cut that wait-list in half now.

Where two years ago we were dealing with applications, as you know, probably three or four years old, and unless you had an emergency - your roof was falling in, practically, or your furnace had gone - you had about a three or four year wait in order to get access to the Home Repair Program. We have now cut that in half. As Len tells me, we have gone from 4,400 people on the wait-list to 2,600 on the wait-list. Obviously, that is still a significant number; but, where we were dealing with applications three and four years old, now we are dealing with applications a year to eighteen months old, essentially.

MR. BUTLER: During one of the follow-ups that I had, David Whelan, I think, is over in your department, he gave me the figures that you are saying there. That is good, I must say.

MR. SIMMS: The objective is to eliminate the funding that the government (inaudible) in two years' time.

MR. TAYLOR: Just a follow-up there. Len just reminded me, the objective is to eliminate it within two years. Right now we are very much on target to have the wait-list eliminated within two years, if not before.

MR. BUTLER: Thank you.

CHAIR: Ms Michael.

MS MICHAEL: Thank you very much, Mr. Chair.

That was good. We had quite a discussion last year, I think, about that wait-list, so it is good to hear that you are on target for getting that eliminated. I am really glad to hear that.

I will revisit a couple of points that Mr. Butler referred to, but I have other questions about the points.

With regard to the fact that if things are not delineated because of the grants and subsidies - you do this in your annual report, don't you? You have a report on all of the details of the Budget and that is where is comes out, because it has to be transparent.

MR. SIMMS: Yes, and we are audited each year by the Auditor General, of course.

MS MICHAEL: Related to that, then, thought, even though you will not have an annual report done for this year, do you have a listing of how you have distributed the money for this year's Budget that could be made available to us?

MR. SIMMS: A breakdown of the $50 million?

MS MICHAEL: Yes.

MR. SIMMS: Yes, I can give you that. Well, I cannot give you the entire breakdown because $41 million of it is the revised budget figure from last year, so we attained that particular money anyway; that is carry-over from last year. So, whatever the questions were last year related to the $41 million are the same answers.

For this year, the additional funding includes – these are some of the items that are yet to be announced through the Provincial Housing Strategy, but - there is $1 million in there for a Homelessness Fund to provide some wraparound services for some of our supportive living groups, as you know.

The government has also provided additional funding in there for extension to our affordable housing regular program, which has been extended for the next two years, which was announced a while back; provided funding for new economic stimulus funding from the federal government's Budget, the money for seniors and disabled. The Province has put in their share. They have also put in an increase of $5.6 million for the renovation and retrofit economic stimulus funding. The salary increases and so on that you mentioned earlier are already included; the community centres increase, $400,000 that the minister alluded to. We also reduced the rent geared to income for working individuals, for working homeowners, as you probably know.

MS MICHAEL: Yes.

MR. SIMMS: So the Province reimburses us for the lost rent and so on.

All of that, in total, adds up to an additional, roughly, ten (inaudible). I did not mention the amounts for the extension of the existing Affordable Housing Program and the new seniors and disabled funding from the Province; that is over $7 million a year.

I will put it in a nutshell for you. Three years ago, the modernization and improvement funding for Newfoundland and Labrador Housing was $4.5 million annually, and it was that for twenty-five years. The Province, as you realize and recall, I am sure, tripled that to almost $12 million over the next two years, which was fabulous, put a lot of extra work on.

This year, under the Province's contribution towards the federal economic stimulus funding and so on, we will be spending, with the funding that we have been using before, and the increased funding they have given us over the last two years, our budget this year for modernization and improvement of our own social housing stock will be $28 million, and again next year, so for the next two years. So we have gone from $4.5 million three years ago up to $28 million in three short years, which is unbelievable, and unbelievably challenging, of course, as well.

MS MICHAEL: Yes.

MR. SIMMS: But I think it will bring a lot of positive results.

MS MICHAEL: We are certainly getting positive feedback from our constituents; because we have, as you know, a lot of constituents who are in your housing.

MR. SIMMS: I appreciate that.

MS MICHAEL: They are very pleased with the work that has been done in their units, for sure.

MR. SIMMS: Yes.

MS MICHAEL: I have a number of questions. I have to tell you, one of my researchers, her background is in Housing, so –

MR. SIMMS: That is good.

MS MICHAEL: It is good.

Last year, actually, when we had our conversation, you did mention that, under Current, $8.1 million was for the Aboriginal Housing Trust and $1.1 million was for the Affordable Housing Trust. I am just curious about: Did all of that money get spent last year? What work was done with that money last year?

MR. SIMMS: The Aboriginal Housing Trust fund, $8.2 million, I think it was –

MS MICHAEL: It was $8.1 million, I think.

MR. SIMMS: Anyway –

MS MICHAEL: Well, she has $8.1 million. If you say $8.2 million, I am sure it is.

MR. SIMMS: Okay.

That funding was provided to the Province, to the Department of Finance, who then gave it to us in our grant. That is why the grant amount was up. It was just a simple transfer, basically.

MS MICHAEL: Right.

MR. SIMMS: We wanted to negotiate or discuss or talk to the four or five Aboriginal groups involved and let them make their own decision as to how they would best prefer to see this funding spent.

One thing we were interested in doing was having a study done to see if we could determine what other Aboriginal housing needs there are, and they agreed to that. In the end, after several months of discussions and consultations with the groups involved, they agreed to a basic breakdown of funding per capita for each group. We have allocated that funding in this fiscal year, or just recently, I guess, in the outgoing fiscal year, we have allocated half of that funding for a home repair program which the Aboriginal groups themselves wanted, and wanted to deliver. It was fine with us. We offered to provide any kind of capacity building we could, with our inspector staff and that sort of thing. We have done that in some of the areas. Labrador is one in particular. They also agreed to hold off on the other half of the funding until we get the study done, just to see if there is more that needs to be done, so that is basically where that is at.

We are just facilitating the consultations. We are letting the Aboriginal groups make their own decisions. It has taken a little longer, I guess, but from our perspective it is federal funding so we are just sort of helping administer it for them.

MS MICHAEL: That is a good way to do it. I am glad you are doing it that way, actually.

MR. SIMMS: Absolutely.

MS MICHAEL: In total last year, how many new units of social or affordable housing units were constructed?

MR. SIMMS: How many new units?

MS MICHAEL: Yes. Did you have any new units at all?

MR. SIMMS: Off the top of my head - they are so infrequent - I cannot remember if there were any.

MS MICHAEL: Okay.

MR. SIMMS: I do know that this year we plan to build six in Stephenville, to partially replace the ones that were lost during the flood over there a few years ago. We are also planning to build six, I think it is, in St. John's, up around Jensen Camp Road, up in that area, and they were to replace some that were removed, but frankly we have not built very many housing units of any significant number for twenty or twenty-five years, in Housing.

Now, we will have a housing strategy coming out with some long-term objectives and goals; and, I guess, depending on the Province's fiscal situation and so on, it would not be a surprise to put forth some ideas or suggestions toward, down the road, some kind of a plan.

The reality is that we do need units, but we need a certain kind of unit.

MS MICHAEL: I know, yes.

MR. SIMMS: The small ones, one and two bedroom.

MS MICHAEL: Yes.

MR. SIMMS: The difficulty is that our portfolio is 80 per cent three or four or five bedrooms.

MS MICHAEL: Right.

MR. SIMMS: Eighty per cent of our wait-list is for one or two.

MS MICHAEL: Are you continuing to try to convert some of those? Because I know you were doing conversion of the large units, especially here in St. John's.

MR. SIMMS: I am sorry?

MS MICHAEL: Are you still converting some of those larger units? You were trying to do that here in St. John's.

MR. SIMMS: Yes, we do that occasionally to help with the accessibility issue in particular, and the best ones to do that with would be a larger house, at least a three or four bedroom. We have done that periodically, but it is fairly expensive. We have done one on Froude Avenue and I think it cost something like $50,000 just to – it is more than a ramp. It is fully accessible that is required, right?

There is potential for, again, some of that long-term planning down the road. We also are looking at a regeneration program of existing units, and there is an idea around that is pretty interesting that we are pursuing as well. Some of this is sort of in our planning for down the road.

MS MICHAEL: Thank you.

I want to ask about the Residential Energy Efficiency Program, because last year, during our Estimates session, the minister said that there was $6.9 million in the NLHC coffers, but only $3.2 million was in the budget for this year for the 1,000. Why was that decision made? There was $6.9 million in the coffers for that, was there not?

MR. SIMMS: Well, the reality is that there was some money spent initially, three years ago. You might recall that funding was put in about three years ago in the budget, and it was to match a then program that the then federal government had in place; we were going to top up. Then the new government came into place and they cancelled the program. That is why the money was sitting there.

In the meantime, we had already done a number of sessions around the Province with the auditors and so on. They were educational sessions, I guess, for homeowners and construction builders, and all of that. We also bought some of those, what are they called? Power meters? We bought some power meters from a company, Blue Line, here in Newfoundland, who had sold 60,000 of them to Hydro Ontario. You are probably familiar with them.

MS MICHAEL: Yes.

MR. SIMMS: They are nice little, neat little, gadgets and they tell you how much energy you are burning.

MR. TAYLOR: Jay Leno.

MR. SIMMS: What?

MR. TAYLOR: Jay Leno.

MR. SIMMS: Yes.

Anyway, that cost – I forget what the amount of money is – some of the money had been spent for those kinds of things. I cannot remember exactly what the rest of it might have been for but it was money that had been allocated or spent for advertising. There is some administrative - there you go, it is all coming back to me now.

The administration is included in that too, about 4 per cent, 5 per cent, 6 per cent, because you had to have some staffing involved in the delivery. I think we had one or two staffing, things of that nature. That is why the amount is three point two, or whatever it is.

MS MICHAEL: I am trying to streamline now because I do not think I need to ask all of these but there are ones I certainly do.

Could you give us some details on some of the programs that were in the budget announcements? For example, the $3 million for the social housing units for low income, are they targeted already? Do you have an idea of where they are going to be located, for example? The same way with the Affordable Housing Program, if you could give us some details on how you hope to see those programs work and the supportive living one as well, I would be interested in information on that.

MR. SIMMS: The $3 million is the Province's portion or contribution required in order to access or extend the Affordable Housing Program. What we are going to do, and the other funding for the persons with disabilities and seniors and so on, another $3.5 million I think per year. What we are going to do is we are going to place an RFP very soon, as soon as we get the agreements with CMHC finalized. We have not quite gotten there yet but we are pretty well there now.

So what we are going to do is call an RFP for proposals, as we have done in the past with the program, and we are going to have three components to it. One will be for the private sector that has, in the past, built some really good projects for seniors in particular and disabled. The other one will be for community-based housing groups. They would be the Kinsmen Club in Marystown who have a senior's complex and they can apply for funding to expand. Some of them might want to put on a couple of units, that sort of thing. The third, and really critical piece, is for the groups who are going to be providing supportive services for persons with complex needs who need housing, and hard to house I guess is often what they are referred to. Similar to what you would be familiar with here in the St. John's area, where most of them are located unfortunately, only in St. John's. Not very many outside yet, but that would be like the Stella Burry's and the Wiseman Centres and that sort of thing. So there will be an RFP called in the next few weeks.

MS MICHAEL: Last year, because we had this discussion last year, one of the points I raised, one of the concerns was the fact, what about if people - because one of the problems with groups outside of St. John's is trying to get partnerships.

We saw, for example, in Labrador West that that project up there fell through because of not being able to get partnership under the Affordable Housing Program. I think it is very disturbing that did not happen up there and they really need it. How are we going to get around that?

MR. SIMMS: Well, I tell you, there was nobody more disturbed than we were. In fact, we went back to them and offered them some additional funding to see if we could help them a bit. The problem was they had, what they thought was some kind of an agreement with the contractor and it did not pan out. They went back and looked for another one. When they came back the cost had escalated totally.

One of the things we are going to do this year is increase the amount of allocation for the units in Labrador because we really wanted that Hope Haven project to proceed. Hopefully, maybe there will be a way to do it this time around.

There is a project being undertaken in Corner Brook through the Canadian Mental Health Association, by the way, for ten units, and that one is proceeding now. They are calling me Len Wiseman, I do not know what that means.

MR. TAYLOR: Do you know Ross Wiseman?

MR. SIMMS: Oh, now I know, brothers. I thought you were talking about the young fellow downstairs the Page, his name is Wiseman. Sorry about that.

MS MICHAEL: I think you have answered some of the other questions I have here.

I am very interested in this one, I think it is really good what has happened for seniors in social housing with regard to the reduction of the percentage but there are many others in social housing who have the same need. Is there any discussion going on, it may have to be for next year's Budget I guess, but would you yourself, as the CEO of Newfoundland and Labrador Housing, be pressuring the minister to get it for other groups, not just seniors? The seniors really need it and they may need it to be lower.

MR. SIMMS: Do you mean reduction in their rent?

MS MICHAEL: Yes, right.

MR. SIMMS: We have done that actually for all of the community-based projects, seventy of them around the Province.

MS MICHAEL: Are they?

MR. SIMMS: Yes.

MS MICHAEL: Oh, I did not realize that.

MR. SIMMS: Yes. Last year the government under the poverty reduction process did the same thing, provided us with the revenue rentals that they would have lost in those community-based projects. So, they have reduced their rental income as well.

MS MICHAEL: To 25 per cent.

MR. SIMMS: It is roughly 25 per cent of their income now.

MS MICHAEL: Okay.

MR. SIMMS: Yes. So that has happened in those community-based projects.

MS MICHAEL: And that was in last year's Budget?

MR. SIMMS: That was last year's, yes.

MS MICHAEL: Okay, it was not something that happened afterwards, it was in the Budget.

MR. SIMMS: No, no, it was in the poverty reduction proposals that we had put forward last year.

MS MICHAEL: Okay. Well, that is all my questions under that section. That is all related to the first section, just simple questions under the capital.

Last year you had $1.7 million in federal funds for new units in St. John's and Stephenville. But Stephenville, is that what is happening this year?

MR. SIMMS: That did not get spent, unfortunately.

MS MICHAEL: It did not get spent?

MR. SIMMS: No. We did award the tender, if I recall, but it is not going to start until, I guess, April. Well, this is April. Pretty soon, I think, it is going to start.

MS MICHAEL: Okay.

MR. SIMMS: It is supposed to be complete by September or October.

MS MICHAEL: Right, okay.

The $1 million for this year?

MR. SIMMS: Good question. That also is a new initiative that the government thought was wise enough to support and provide the funding for. It relates back to the issue of if you are going to build any new units and new houses. That $1 million is to allow us to have a look at sites in the Province that might have the biggest need; also, whether or not land is available; the design and engineering for certain types of units that you might want to put in place. It also allows us to have a look at regeneration projects within our own units, the less dense areas, the smaller areas. We would not do it in high density areas but you could do it in less dense areas where you could do some renovations of two units and make three out of it, including a disabled unit.

MS MICHAEL: Yes.

MR. SIMMS: So that is what that $1 million is for.

MS MICHAEL: Good.

Having said that was all - it isn't, because it is dawning on me now with regard to the Energy Efficiency Program. The money that you had in the coffers for that is now used up, or will be used up. Where is the new money going to come from to continue that program?

MR. SIMMS: There is only three point two, there was six point two.

MS MICHAEL: Yes, I know, but in the future, after this year?

MR. SIMMS: Oh, it will be assessed and we will go back to government then to see, I guess, if they want to continue. That will be up to the Natural Resources department. It is their program really.

MS MICHAEL: Right.

MR. SIMMS: The idea is in two years we will see how it works, see if there are energy savings and then, I guess, Natural Resources would want to analyze it and discuss whether or not they wish to proceed with further funding from government, I guess. I cannot speak for the government (inaudible).

MS MICHAEL: No, I know. I will speak to the government.

Thank you very much.

Thank you, Mr. Chair.

MR. SIMMS: Thank you.

CHAIR: Thank you very much.

Are there any other questions under the Newfoundland and Labrador Housing Corporation?

I will ask the Clerk if he would call the subhead, please.

CLERK: Subhead 1.1.01.

CHAIR: Shall 1.1.01 to 1.1.02 carry?

SOME HON. MEMBERS: Aye.

On motion, subhead 1.1.01 to 1.1.02 carried.

CHAIR: Shall I report the Estimates of Newfoundland and Labrador Housing Corporation carried without amendments?

On motion, Estimates of the Department of Newfoundland and Labrador Housing Corporation carried without amendment.

CHAIR: Thank you very much.

Mr. Simms can retire for the evening.

MR. SIMMS: Thank you, Mr. Chairman.

I am after retiring four times. I won't be doing it this evening.

CHAIR: I guess we will call the Estimates to start Transportation and Works.

Shall subhead 1.1.01 carry?

We will start questions, I guess, from Mr. Butler, whenever you are ready.

MR. BUTLER: I guess it is fairly wide-ranging. We can go from anything here now, can we minister? That is the only subhead you want.

Just a general question, highway signage: Does your department have anything to do with that or is it all with Government Services, or do both departments?

MR. TAYLOR: What aspect of -

MR. BUTLER: With regards to businesses putting signs on the highways.

MR. TAYLOR: Okay. We put them up or knock them down. Government Services and Tourism are essentially the ones who are responsible for determining the policy, and what have you.

MR. BUTLER: Your department, more or less, is a corridor where the signs can go or something like that?

MR. TAYLOR: The new TODS program, I guess, the blue signs – they are currently blue anyway, I do not know what color they will be in the future, but the ones that are currently blue - we are responsible for putting them up, taking them down and adding finger boards to them. It is based on – I guess Government Services and Tourism.

MR. BUTLER: No, what I was thinking about, the signs that you are talking about Government Services and Tourism put up, the corridor where they can put them, I guess that is in conjunction with your department?

MR. TAYLOR: Yes.

MR. BUTLER: Okay.

With regards to the closure of the fourteen highway depots back sometime ago, I stand to be corrected, but my understanding is that was taken to court by the union. They won their case then government appealed it again. I was wondering what stage that is at now? If that is correct, what I just said. That is what I was advised anyway.

MR. TAYLOR: I think that is fairly accurate. Isn't it, Bob?

MR. SMART: It is still before the courts.

MR. TAYLOR: Yes, it is still there. That is more or less being handled by Treasury Board, I guess, right?

MR. SMART: I think so.

MR. TAYLOR: Is that we would not be the lead department on it even though it is our depots but I guess it is more about – well, I do not even know what I can say or not say.

MR. SMART: It is before the courts.

MR. TAYLOR: That much I can say, yes.

MR. BUTLER: So, it is still before the courts?

MR. TAYLOR: Yes, that is correct.

MR. BUTLER: I know, minister, I asked you this question with regard to summer maintenance and you confirmed that as far as you know there is no decrease in the number of jobs for summer maintenance this summer.

MR. TAYLOR: That is correct, yes. I checked on that after you asked the question in the House last week, just to make sure. I had not been aware of any changes, and as I said then, the summer maintenance program should be basically the same this year as it was last year.

MR. BUTLER: Where I came from that question, it came from workers in my area who - they were not told definitely that this was going to happen but raised some concerns that they felt there was twelve people involved with the maintenance at the depot in Bay Robert's. This year they were hearing that it could be four less than last year. That is where I came from with that. So, I take your word for it, sir.

MR. TAYLOR: I do not know if – Gary, are you able to speak to any –

MR. GOSSE: There are no changes from what we had last year.

MR. BUTLER: I know there was some discussion last year and it is probably continuing now with regards to the quality of asphalt. I know I mentioned this to you one day just on the sideline. Has anything been determined in what may have been causing the problems? Like I mentioned to you here in the House one day, even what was paved on the TCH last year, it is almost like there is rutting in that already. Is there something not being put into it? Is there a different type of asphalt? Have you determined what the problem is? Maybe it is not a problem.

MR. TAYLOR: Some of the problems related to the lateness of the application of asphalt. You take the Outer Ring Road for example, I mean certainly it would appear – it was known at the time there was significant rutting there a couple of years ago, two, three years ago, whatever it was. While it was very late in the season there was a bit of money available and the decision was taken at the time, for safety reasons, to mill out that section of road and apply a layer of asphalt there to level it out. There were a significant number of accidents that were being caused by the rutting in that area. It was understood by the department, that given the lateness of it, the appropriate curing would not take place. The contractor, when they laid that asphalt, I am given to understand, would not guarantee the quality of the work for any length of time. Correct me again if I am wrong, Bob.

There is an ongoing quality assurance program that tests asphalt as it is being laid. We have labs that analyze the composition of the asphalt. As you said, there are a number of spots where it would appear to me, anyway, that we have asphalt that is breaking down quicker than you would expect. It is one thing for it to be breaking down if we applied it in the fall, but it is another thing for it to be breaking down when we apply it in the spring. You spoke with me the other day, and I drove the piece of road from Salmonier Line in to Paddy's Pond not long ago. For asphalt that is two years old, I thought that there was more deterioration than we should be seeing at this point, and there are a number of spots around the Province where we are having a look at it right now. What results, what we will find out, I do not know, but we are certainly looking at it and we are concerned about the quality.

MR. BUTLER: With regard to the painting of lines on the highways, I know that is an issue every year. Everyone wants their lines painted before the time comes to paint. Have any other jurisdictions – do they all run into the same problem? It seems like the lines go fairly quickly. I do not know if it is – I cannot say it is the quality of the paint, but is that a problem with the asphalt as well, I wonder?

MR. TAYLOR: I do not know. Does anybody know? It seems like the lines do not last long.

MR. SMART: Everyone faces the same problem on the lines, or anyone with similar climatic conditions as us in the wintertime with salt and ice and snowploughs. Everyone faces the same challenge, come the spring. The City of St. John's faces it. Everyone faces it. It is not getting any easier, because one of the things is that, for environmental reasons, we are being discouraged from using oil-based paints in the future and using more water-based paints, which will keep the lines on the road for even shorter periods of time, so we will have to paint them even more often.

No, it has nothing to do with the quality of our paint. It has nothing to do with the pavement. It just has to do with the nature of our climate, and the paint does not stay.

MR. BUTLER: I know last year Minister Whalen, who was the minister then, committed to try and find a resolution to some of the issues that the department was facing with Class 4 roads and they were going to revisit it. I was just wondering: Has that been done? Will you return to doing Class 4 roads again to a certain degree?

MR. TAYLOR: Well, we do not know what we are going to do with them yet, to be honest with you, but she did undertake a review, and the department has undertaken a review. As a matter of fact, we just had a conversation about it last week, as to the status of it. I cannot give you much more in the way of a report on it right now, other than to say we have completed the review and I will be having a look at it in the very near future.

MR. BUTLER: Okay.

In 2007 we saw a shortage of salt for our roads. I was wondering, was there a shortage in 2008 or did everything work out okay in 2008?

MR. SMART: No, we have not had a shortage. Last summer, actually, we bought additional salt to increase our inventory, so we have not had an issue this year.

MR. BUTLER: Okay.

I think the previous year, more or less, the contract was extended to the couple of suppliers or whatever, wasn't it? So it was not an issue this year?

MR. SMART: No.

MR. BUTLER: The twenty-four-hour snow clearing project, I know you are probably still reviewing the results of that. Is it too early to ask if it will be extended to other areas next year?

MR. TAYLOR: Well, really, we have hardly gotten into reviewing it yet, in all honesty. We only just ended it now. We have collected data, obviously, throughout the winter on traffic patterns and what have you. It is not too early to ask or to say whether it is going to be extended or not. The budget is done now, subject to it passing in the House, of course. The budget for next year on twenty-four-hour snow clearing is the same as it was this past winter season, so we will not be expanding it. Between now and when we start it up again in November there may be an opportunity for some adjustment of it. Whether we would continue to provide it in areas where we now do, versus taking it out of that area and putting it in another area, will be determined over the course of the next six months. Certainly, there would not be any expansion in the next year. Like I said, some areas that have it may not have it, and some areas that do not have it may end up having it, but that is more or less where it will be.

MR. BUTLER: Okay.

Another issue we discussed last year was the Geographic Information System within your department. I do not know how the full thing worked, but I think it was more or less you had a closer view, I suppose, of all the systems, all the road links within the Province. I was wondering if you can provide an update as to how this computer-based system is working out. I know it probably was in its early stages last year when that was mentioned.

MR. TAYLOR: Do you want to grab that one, Sir?

MR. SMART: Yes.

Actually, this year is the final year of development. We have parts of that Geographical Information System or certain regions of the Province already on it, but it is actually this year when we will have all parts of our road network, roads, bridges, signs, anything to do with our transportation system, loaded on to that network and it will become fully operational for planning next year's roads program.

MR. BUTLER: With regard to the bridges in the Province, I know back some time ago there was an inspection done of the bridges and so on. Do you feel that all of the bridges within our system now have been checked out and everything is fine with regard to that part of your transportation system?

MR. TAYLOR: I have been around long enough to know that you never say never. I am sure the Minister of Transportation in Quebec would never have thought that one of his bridges, or their bridges, was going to collapse. You never know. Our bridges have a fairly rigorous inspection program. At least every second year they are inspected. Once they get to a certain point, if there is any cause for concern, they are inspected on a more frequent basis than that.

Some MHAs get a little frustrated when they see bridges and culverts identified in the roads program in their district, because they – as we all do - like to see potholes covered up. You do not see the underside of a bridge but you see the top of a road. As a rule, if the bridge section in the department identifies a bridge as being a priority, or a culvert as being a priority, for replacement then it is not debatable at all. It goes into the roads program and that is it.

You will see, I think, over the course of the next couple of years in particular, a growing proportion of the provincial roads program spent on bridge replacement; because our bridges, as you know, a lot of them were built back when the roads were put through in the 1960s and they are reaching the end of their life. So you see that, and there are some major bridges that you will see replaced over the course of the next couple of years. We are in planning now for the Sir Robert Bond Bridge across the Exploits, the Sir Ambrose Shea Bridge down in Placentia, so there are some major pieces of bridge work that will be done over the course of the next two to five years.

MR. BUTLER: I couldn't agree with you more, Sir, because there is one in my district. When we had that storm – Chantal, I think it was called - back a couple of years ago, the bridge going across between Bay Roberts and Spaniard's Bay-

MR. TAYLOR: That is right.

MR. BUTLER: If you look at that bridge you would never say it was going to happen, what happened to it with that flood of water. It is good to see the new one being constructed there.

I guess in the last year, or year-and-a-half, we heard a lot about the Outer Ring Road, and people concerned about how dangerous it was. I know there was paving done there to try to correct it, guardrails put through it and so on. Do you get much feedback from the general public now, who use that road, or have all of the problems been…. Like you say, you never say never, but –

MR. TAYLOR: No, I understand.

I don't know if I could be so bold as to say this or not, but my driving habit on the Outer Ring Road has changed in the last couple of years, and it is in large part because of the number of unmarked police cars that I see from time to time out there. I suspect there has probably been a marked decrease in the number of accidents on the Outer Ring Road as a result of that.

The Outer Ring Road, no doubt there is some difficulty in maintaining it, given its elevation, precipitation and the rutting that is taking place from time to time. We have some rutting there again this year that we will deal with this year.

I think the major problem on the Outer Ring Road is that people think they are on a drag strip - myself included sometimes. My driving habit, I keep my speed below 110 out there now, where I cannot say that I always did that.

MR. BUTLER: Has any of the roadwork been announced for this year? If the tender has not been called, when will the tender be called for the Trans-Labrador Highway, the work that is to be done there this year?

MR. TAYLOR: Our first tender call on roadwork was this past weekend out in Bonavista North, I think, was one piece of it, and a piece over on the West Coast, a bridge over in Gillams, and a culvert out in Joan Burke's district, so she is happy with her culvert, I hope.

The Trans-Labrador Highway, we will be going to tender on that within two weeks on the hard surfacing, with an RFP. I guess that is about it. We anticipate having pretty well all of the tenders called, our objective would be, by mid-May to have all tenders called.

MR. BUTLER: Has there been any closure of any government buildings in the past to achieve savings or anything like that?

MR. TAYLOR: What is that?

MR. BUTLER: Any government buildings that have been closed through your department, or within any other department, I guess, that was under the jurisdiction of your department? Any other buildings that have been closed to bring about savings or anything like that?

MR. TAYLOR: I would say, as a rule, we are trying to spend on own buildings to upgrade them in order to take people out of leased space and rental space and bring them back into our own buildings in order to achieve savings, as opposed to closing our buildings and taking people out of them.

MR. BUTLER: Okay.

Our two new ferries - I know I asked you this question in the House as well - when do you anticipate that the two new ferries will be completed? I know things can happen from time to time.

MR. TAYLOR: Not soon enough. If you have one right now that you can put your hands on, let me know, will you?

I guess, Paul, it is June, probably, next year? In June we can probably expect to see our first one?

MR. ALEXANDER: The contract delivery dates are July 20 and October (inaudible) of next year.

MR. BUTLER: July of next year.

MR. ALEXANDER: But we are hoping to (inaudible) a little earlier.

MR. BUTLER: In the budget this year we saw –

MR. TAYLOR: Just to be clear, because I am not sure that you could hear, but the delivery dates, one is July and the other is October.

MR. BUTLER: Okay.

The other two new ferries that were mentioned in this year's Budget, when do you anticipate any work? I do not mean, now, the construction part of them - that is going to take a while - but I guess the preliminary work will start fairly soon on those other two new ones as well?

MR. TAYLOR: This is basically design and engineering.

Paul, do you want to speak to that one as well?

MR. ALEXANDER: I can, yes, Sir.

The third one is the same design as the first two, so it would probably be added on to the current project for the third vessel, no design work necessary, and the delivery of that third vessel would probably be six months after the second one, roughly. The third one is a replacement for the Winsor in Fogo, and the design work is about to start for that one. I anticipate a year to eighteen months design phase before we go to tender for the construction, and the construction of that vessel would take approximately another year to a year-and-a-half.

MR. BUTLER: The two new ferries, the first two, has it been determined where they will be placed as of yet? I know last year the minister could not go that far at that point in time.

MR. TAYLOR: Well, I can pretty well say with certainty that yes, the first one will go to Long Island-Little Bay Islands and the second one will go to St. Brendan's. That would be the thinking right now. That is where the two of them will go anyway, whether one goes – I guess it all depends on what kind of circumstance you have to deal with when you pick up one. If we keep having them run into rocks and break down, and stuff like that, then God knows what we will have to do, but right now that will be the schedule.

MR. BUTLER: After you saying that one is going to go to the Long Island ferry, I have still to ask you this question, seeing that I had it there. I guess the cost of the causeway that we hear talk of from time to time, and a ferry, what was the last figure with regard to the cost of the causeway? I guess it is a tremendous amount of money versus –

MR. TAYLOR: I guess, Roland, the estimates within the department right now, based on a cubic metre of rock, is estimated at somewhere around $20 a cubic metre. If we had to put a causeway across there at a bridge height of six metres, the estimate would be a minimum of $50 million. That, as you know, would be regulated by the federal government. They would tell us what size bridge height that is for navigation purposes under the Navigable Waters Act. If we had to go to a twenty metre bridge, which is probably where we have to go, then that would drive the cost up to at least $100 million. We have no control over that. Once you start down that road, I mean whatever the feds say the feds say.

Just to put it in perspective, and I said this the other day, I think everybody recognizes that getting across the Churchill River was a significant feat. I am not sure what the water depth is on the Churchill River but my guess is it is probably no deeper than ten metres, at its deepest point where the bridge and causeway were put across. Does anybody know?

MR. GOSSE: It was no more than five metres of water in the Churchill River.

MR. TAYLOR: (Inaudible) a water depth of a maximum of five metres on the Churchill River and the span was approximately 800 metres, if my memory serves me correctly. The cost of getting across there was $23 million three years ago.

On Long Island, the span is 630 to 650 metres, roughly. So a little bit shorter but your water depth at its deepest point is seventy-three metres and the seventy-three metres starts almost immediately. You have deep water right at the rocks out there, except for where the Hamilton Sound struck the other day, but other than that there is lots of water there apparently; at least in my experience going through Long Island Tickle. You have probably an average water depth on that Tickle of forty metres to fifty metres. So you are talking about a water depth of ten times of what you see on the Churchill River and the cost is $23 million to get across the Churchill River. So, it does not take you very long to figure out that you are into big money. It is like Jeopardy now, big money. Wheel of Fortune, is it?

MR. BUTLER: Deal or No Deal.

You have already mentioned three of the four ferries, possibly where the third one is going when that time comes, and that is all good news.

I was wondering, has your department thought about the construction of a ferry in the future for roll on, roll off ferry service for the south coast, which would include say, Pool's Cove, Rencontre East and Bay Largent area? Is that something that -

MR. TAYLOR: It is not in our sights right now.

MR. BUTLER: Okay.

MR. TAYLOR: That is for sure. Right now, our preoccupation would be with replacing those that we identified, St. Brendan's, Long Island, Little Bay Islands, Fogo Island. When we get beyond that, obviously, the next place that we will have to have a look to figure out what we are going to do, whether we maintain the current type configuration or do something different, we will figure out what we are going to do with the Straits crossing, the Strait of Belle Isle.

Shortly thereafter, we will be getting to the point - I guess somebody will, I will not be around to deal with it in the meantime. Shortly thereafter we would have to have a look at Bell Island, I would think.

Our contracted services, right now there is no view to, other than figuring out what we are going to do on the Strait of Belle Isle crossing, our contracted services would remain contracted, and we changed some of the specifications there when it comes to getting newer vessels and what have you.

MR. BUTLER: Just one other question and I will pass it over then to my colleague.

With regards to - like you said, when the new ferry comes on, the one for the Long Island ferry service, the system that is there now where the people are concerned about not being tied up in that particular area for night emergencies and so on. Is that the same system that would be in place at that time or is there another scenario that you could be looking at where those issues can be resolved?

MR. TAYLOR: Well, obviously, the decision has been taken on the Long Island, Little Bay Islands, that there will be a one vessel operation. We will be having a discussion starting – it was supposed to start tomorrow, but apparently that may not happen, with Long Island and Little Bay Islands about three point, four-point service, Shoal Arm, Pilley's Island, how those things figure in, whether Halls Bay Head makes any sense or not from a cost effective perspective.

So, we will be having that discussion with those people starting very soon, maybe as early as tomorrow. I really would not be able to prejudge the outcome of that right now, but I have to say this, there are very few places in the Province, and probably anywhere, that depend on ferries where vessels operate only on a two-point service, where the vessel tied up to the dock of the isolated community - I guess, for lack of better terminology - on a nightly basis.

The Coast of Labrador depends on multi-point service. The South Coast, by and large - Ramea, Grey River and Burgeo comes to mind. All of the other communities along the coast depend on essentially, a coastal boat type service, and Fogo and Change Islands.

Outside of St. Brendan's, Bell Island, Long Island and Little Bay Islands, when they are on a two-vessel service; pretty well everybody else in the Province depends on a service that has more than two points of stop. It is difficult to justify much more than that in many of those cases.

We do have emergency response capabilities, and to be honest about it, if you are in Gunners Cove in a snowstorm and you need to get to the hospital in St. Anthony, it is not much different than being in Long Island on a fine day and needing to get to the hospital, or in a snowstorm. The bottom line is you have a distance to travel and a time to get there.

MR. BUTLER: Okay, Mr. Chair, I will pass it over to my colleague.

CHAIR: Carry on.

MS MICHAEL: Thank you very much.

This will be the boring part now because I am going to do line by line stuff. Being from an urban district in the city, my concerns are the macro ones rather than the micro, I guess, so the budgetary.

I will start with section 1.2.01, and the first line item Salaries. Minister, I would like just an explanation of the variation from the Budget and the revision last year and now the increase in this year of the Salaries, please.

MR. TAYLOR: Yes, that is fairly straightforward actually.

We had an assistant deputy minister vacant for a period of time, and as a result, of course, we did not use all of our salary budget. We are almost back up to – we anticipate that our ADM position on Transportation will be filled shortly and our ADM on Works was filled. So those vacant positions have been or are in the process of being filled right now. So we should be pretty well at our full expenditure.

MS MICHAEL: Okay. It is still about, well almost $60,000 over from the budget of last year and this year's budget. Is that just a normal increase?

MR. TAYLOR: You will see a bit of a jump in pretty well all of the salary lines throughout this year and that is because, in part I should say, of this year's one in ten year time that you have twenty-seven pay days.

MS MICHAEL: Okay, that is right. We had that earlier today actually, in HRLE.

MR. TAYLOR: Yes. Then of course there is the normal step increases and collective bargaining pieces and what have you.

MS MICHAEL: That is right. I forgot about the twenty-seven pay periods.

MR. TAYLOR: I did not realize it until today.

MS MICHAEL: Yes, I did not either until HRLE this morning.

Under the next line item, the Employee Benefits, why the $2,900? It is not a big one but it is an over expenditure.

MR. TAYLOR: My understanding is that is due to additional conference fees.

MS MICHAEL: That is what I figured.

MR. TAYLOR: At the National Executive Forum on Public Property.

MS MICHAEL: Okay. That is all in that one.

1.2.02; the same thing here. There is an increase in Salaries from last year, both from the revision and from the budget last year.

MR. TAYLOR: It is the same answer as in the last one. It is the twenty-seventh pay period and normal step increases.

MS MICHAEL: Two-hundred thousand dollars?

MR. TAYLOR: Yes.

MS MICHAEL: It would have been that much? Okay.

MR. TAYLOR: That is what my notes tell me now.

MS MICHAEL: Because that seems like a large amount, $200,000 to be only the step increases and the twenty-seven.

MR. TAYLOR: Actually, it is one hundred and -

MS MICHAEL: Sixty-four, five actually.

MR. TAYLOR: Yes.

MR. SMART: In any of these subdivisions, aside from the twenty-seven pay day and step increases and salary increases, if a position was vacant for two or three months last year and it is now filled, that will factor in there as well. So throughout all of these you will see those types of variances.

MS MICHAEL: Right. Okay.

Professional Services, $3,400 more spent than had been budgeted last year.

MR. TAYLOR: I am going to need somebody to explain that one. It is due to an increase in outside consulting services but if anybody can shed any light on what those outside consulting services would be.

MR. SMART: Minister, I cannot say right off hand but we can get you the information. We went outside and engaged a consultant to assistant with some part of our human resource management function, I would expect, but what that exact consulting service was I cannot tell you off the top of my head.

MS MICHAEL: Okay, if you could get that information, please. Thank you.

Under 06, Purchased Services overspent in the revision $72,000 more. Then this coming year the budget is much smaller, so if you could just explain those two things a bit.

MR. TAYLOR: Yes, that is related to advertising costs for job competitions. It is my understanding – correct me if I am wrong Bob, but the way I understand this is that this is being revised downward this year because restatement of advertising costs to the Public Service Secretariat.

MR. SMART: That is correct.

MS MICHAEL: Could you repeat that last sentence? I am sorry. It is revised down because?

MR. TAYLOR: The Public Service Secretariat is –

MR. SMART: We had to pay for all the advertising for job competitions and in the next fiscal year the Public Service Commission is going to take over control of a lot of the advertisements.

MS MICHAEL: Okay. Thank you very much.

The next one, 1.2.03; in this section, what does the Employee Benefits cover because this is a large amount? I know the meaning of employee benefits changes from section to section and department to department also. What is covered in this one?

MR. TAYLOR: My understanding is that would be Workers' Compensation.

MS MICHAEL: Okay.

It is not a fixed one obviously, because it went down in the revision but you have it put back up to what it was budgeted last year.

MR. TAYLOR: Yes, it did not cost us as much for Workers' Compensation payments last year as we had anticipated, and we are budgeting the same amount again this year.

MS MICHAEL: Okay. In 03, Transportation and Communications, there was a significant over expenditure there from the budget. What was that?

MR. TAYLOR: That would have been related to relocation of employees.

MS MICHAEL: From where to where?

MR. TAYLOR: Moving employees from one part of the Province to another part of the Province as part of, for example, meeting somebody somewhere and moving costs, or part of the collective agreement or –

MR. SMART: New hires.

MR. TAYLOR: New hires, or whatever. Many times peoples' relocation expenses are to be covered.

MS MICHAEL: Is it often that it will go that far over from what you budget, because it is a fair amount over from what you budgeted?

MR. SMART: Depending on the recruitment, it does not take many recruitments. If we hired two or three people who had to move house and we pay real estate fees, it does not take a lot to really put your budget out of whack, and we have been doing a lot of recruitment, as you will see in some of these numbers, in filling a lot of our positions. It does not take a great deal to put that out.

MS MICHAEL: Thank you.

Under 06, in the same section, again an over-expenditure from the budget. If I could just get an example of what the Purchased Services would be in this area that would cause that over-expenditure.

MR. TAYLOR: Well, it is utilized for learning and development, for training and what have you, but why it would be significantly over -

MR. SMART: Well, we would have put a considerable effort into staff training, as well, for heavy equipment operators and trades people right across the department. We have a budget for training but if we, going through the year, realize savings in some other part of our budget, we transfer some more money into training and do some more training. You will see some of these are down and some of these are up, which shows the movement of money around the department.

MS MICHAEL: Thank you very much.

What was that?

MR. TAYLOR: I was just saying, where we have been recruiting a significant number of new people that would require an increase in the level of training that would be required.

MS MICHAEL: Right.

Do you have figures on how the recruitment is going, since you are bringing that up?

MR. TAYLOR: Interestingly enough, I was in the highways depot in Deer Lake on Friday and out of about fifteen, I suppose – Terry, what have we got there in heavy equipment, mechanics and the like? Fifteen probably, and in the last year there were, I thought they told me, eight new people working in that depot. Of course, there are challenges in some areas and we have a great deal of trouble trying to recruit. You might see that later in the Estimates, if you pick up on a certain number. We have significant problems with recruiting engineers and we have significant problems with recruiting people in some of the more remote parts of the Province, to the point where we had a competition just recently for an engineer - I forget what the starting salary was, somewhere around $65,000 or $70,000, I believe - in Labrador and we did not get one application.

MS MICHAEL: Not one?

MR. TAYLOR: No.

MS MICHAEL: Significant.

Are younger workers coming forward in response?

MR. TAYLOR: I would not be able to tell you offhand what the demographics of the recruits would be.

MS MICHAEL: You have not been tracking that?

MR. TAYLOR: No. The recruits that we have up my way are young, my age. They are all the young crowd I grew up with.

MS MICHAEL: No comment.

Having said that, we will go then to 1.2.04. Under Transportation and Communications, I hear we have the opposite, where you had a fair bit budgeted and the revision was quite low.

MR. TAYLOR: Which one again? I am sorry.

MS MICHAEL: 1.2.04., Policy Development and Planning.

MR. TAYLOR: Yes.

MS MICHAEL: There has been quite a change there. I am just curious as to why this year's is going to be closer to what your revision was than to the original budget.

MR. TAYLOR: I was not sure what you were talking about. I am sorry.

MS MICHAEL: That's okay.

MR. TAYLOR: You are talking about Transportation and Communications, $170,000 down – that was reduced travel of staff and basically there was a deferral of the Island Transportation Strategy. That is where the savings were.

MS MICHAEL: Thank you.

In 05, Professional Services, again Budgeted $67,500 but only spent $5,000.

MR. TAYLOR: Same reason.

MS MICHAEL: Same reason, okay. They are both related.

MR. TAYLOR: Yes.

MS MICHAEL: The same with Purchased Services, you anticipated but now you do not even anticipate purchasing any services for this year under the Policy Development Planning.

MR. TAYLOR: Again, it is tied in with the deferral of the Island Transportation Strategy.

MS MICHAEL: Okay, great.

Under Policy Development and Planning, what would be the nature of the Grants and Subsidies?

MR. TAYLOR: Fortunately, I have the four of them here.

Transportation Association of Canada for $30,000; the Grand Concourse Authority receives $150,000 from us; Statistics Canada consensus tabulations receives $4,500; and miscellaneous, whoever miscellaneous is, receives $20,000.

OFFICIAL: That is our softball team.

MR. TAYLOR: That is our softball team, is it?

SOME HON. MEMBERS: [Laughter]

MR. TAYLOR: I did not know but it was part of Public Service Week or something.

I guess somebody might have some kind of a forum on. I do not know. For the sake of argument, maybe when the joint –

MS MICHAEL: Are you going on the record now?

MR. TAYLOR: Yes. I do not know. We can find out for you, if you want. It is the probably the easiest to answer (inaudible).

MS MICHAEL: I think that would be good, actually. Thank you very much.

I have a habit of asking for the written report on Grants and Subsidies, so I might as well ask you too.

Let me just check now, because I have to read this (inaudible) here. I am not going to ask about the Salaries there, because I will take your advice, it is exactly – I am looking at the Mail Services - the same answer as in the other areas.

MR. TAYLOR: Yes, there are a couple of vacant positions there, and then the twenty-seven payroll section again.

MS MICHAEL: Under Administrative Support, Capital, 1.2.06, Property, Furnishings and Equipment, $250,000 budget last year: Does no revision mean that that was not spent at all?

MR. TAYLOR: That is correct. That money was budgeted for a bridge management program, and there was a delay in getting that up and running. This year we anticipate moving forward with it so it is back in full for this year.

MS MICHAEL: And you have increased the amount?

MR. TAYLOR: Yes.

MS MICHAEL: Thank you.

Under Road Maintenance: now, in this one, under Salaries, 2.1.01, this seems to be a significant amount more, but is that the case? Are there new positions in there?

MR. TAYLOR: My understanding is, the change from the budgeted to the revised for last year was due to an increased level of severance payments, and there were additional costs for GIS positions, the Geographic Information System piece. This year, the increase is due to salary increases, additional maintenance positions for new sections of the Trans-Labrador Highway, and the twenty-seven payroll.

Once we bring on the phase III of the Trans-Labrador Highway, we have to have another supervisor, two new depots, and what have you.

MS MICHAEL: That is fine, thank you.

Line 04, Supplies, overspent, and what would be the nature of supplies in this area?

MR. TAYLOR: Protective equipment. Safety gear, basically.

MS MICHAEL: Okay.

In Professional Services you had an expenditure that you did not anticipate, $400,000, line 05. What would that have been?

MR. TAYLOR: That is related to consultant costs on the GIS project.

Bob, I do not know if you want to provide any more detail on it.

MR. SMART: It is really just a reclassification of expenditures. If you look at the next line it is down approximately four hundred thousand, so the money just moved. It was more appropriate that it be a professional service rather than a –

MS MICHAEL: A purchased?

MR. SMART: Yes.

MS MICHAEL: Thank you.

Then down to 10, Grants and Subsidies: Maybe you could also include that, unless you have the information now, what the Grants and Subsidies are in this area.

MR. SMART: Local roads grants. In some areas like Francois on the South Coast, areas that do not have roads, they basically have ATV trails and so on. That is their road network. We do provide funding for those communities to undertake the upgrades of their own local transportation. It is easier for us to give them the money then for us to go down and do it.

MS MICHAEL: Sounds smart.

Under 2.1.02, Sign Shop, under 04, Supplies, it went down a bit. This year you are anticipating a fair bit less, and these are the supplies just for making the signs, I guess. Why so much less this year? I am not complaining that there is less money being spent.

MR. TAYLOR: There was a one-time funding in there for the brand initiative, so when we changed the signs on our public buildings and so on and so forth, there was a one shot deal there on that. We would not anticipate quite such a requirement this year.

MS MICHAEL: Thank you.

The next one, 2.1.03, Maintenance and Repairs, again under 01, Salaries: there would have to be new positions in here because it is $825,000 more.

MR. TAYLOR: That is due to an expanded program, overtime costs and severance costs. This year's increase is related again to the twenty-seven payroll and the step increases.

MS MICHAEL: That is an area where you would have overtime of course.

In 07, Property, Furnishings and Equipment, an over expenditure, not a major one, but it is still an over expenditure. What would that have been?

MR. TAYLOR: Equipment purchases.

MS MICHAEL: Road equipment?

MR. TAYLOR: I do not know what kind of a piece of equipment that would have been or if it would have been pieces of equipment, but it would have been related to our summer maintenance program.

MS MICHAEL: Thank you.

MR. TAYLOR: Obviously, it was either a number of small pieces or one medium-sized piece for –

MS MICHAEL: For that amount.

MR. TAYLOR: For $18,000 we did not get a whole lot.

MS MICHAEL: No.

MR. TAYLOR: It might have been more guard rails or something like that. I cannot image that it was a piece of heavy equipment.

MS MICHAEL: No, not for that price.

Subhead 2.1.04., once again the amount under Salaries is up a fair bit, up $1,750,000 from the budget last year. The revision went up during last year's budget, so did you have anticipated new personnel brought in under that or was that the new twenty-four hour?

MR. TAYLOR: No, that would not have to do with the twenty-four hour, the twenty-four hour would have already been built into the budget.

MS MICHAEL: That is right, yes.

MR. TAYLOR: I guess that is where that twenty-four hours would have shown up, in this line item here.

The problem with budgeting salaries on snow and ice control in the winter maintenance program, as you can appreciate, is you never know how much snow is going to fall and how long you are going to have to keep people on. So a lot of this would be related to overtime costs and there would be some severance, because obviously some of our crew are getting a little older and getting out and so on and so forth. That is essentially what would cause the fluctuation there. Once again, the budget up this year is just a reflection of the same thing as in pretty well every other line on Salaries.

MS MICHAEL: Under Purchased Services, is this subcontracting?

MR. TAYLOR: Yes. The decrease is related to a realization of a reduced cost of hired equipment and maintenance on the Trans-Labrador Highway primarily. The increase again relates to the Trans-Labrador Highway and additional funding for the road maintenance contracts there in the coming year.

MS MICHAEL: I am always curious when I see the provincial revenue lines because I always wonder where this provincial revenue would have come from. Is that a grant that gets transferred?

MR. TAYLOR: I do not know but would that have anything to do with the money that we recover from municipalities for snow clearing?

OFFICIAL: Yes.

MR. TAYLOR: A community that cannot get a private contractor to do their work and we charge them upwards of, whatever, $3,000 or $4,000 or $5,000 per kilometre of road. Now, I cannot say for sure if that is all that is, but that will be what I would –

MS MICHAEL: It is interesting because the revision and the budget are identical, which is not usual.

MR. TAYLOR: No. Well, I guess we would know –

MS MICHAEL: You must have a contract separating -

MR. TAYLOR: We would know how many kilometers, and you are doing that on a contractual basic. So it is fairly –

MS MICHAEL: Constant.

MR. TAYLOR: It is not like it varies from time to time. We just say this is the amount we are going to charge you per year, and whether it snows or it does not snow we take the money from you.

MS MICHAEL: Okay. Good enough. Thank you.

The next one, 2.2.01., under Supplies. What would the Supplies be here, because you overspent last year?

MR. TAYLOR: That is primarily related to uniforms for security guards, believe it or not.

MS MICHAEL: Okay. I believe it. They cost money.

Professional Services, again, there was a small increase there of $12,000. What would that have been?

MR. TAYLOR: That is related to property surveys. We do property surveys on behalf of all government departments.

MS MICHAEL: Right. You had to do more than you anticipated?

MR. TAYLOR: Yes.

MS MICHAEL: Okay. Thank you.

Under 2.2.02., Technical Support Services. I guess under Salaries, again you had personnel changes happening?

MR. TAYLOR: Yes, we had a number of vacant positions and the revision upward again this year is reflective of what we anticipate our staff complement to be and our twenty-seven paycheque again.

MS MICHAEL: Right. Okay. My notes here are looking confused to me. I will just have to check for a minute.

Purchased Services, the budget was quite high, $3 million, whereas the revision was much lower. You are sort of half, not exactly halfway between, but what are the Purchased Services here?

MR. TAYLOR: My understanding, that is our insurance policy on our public buildings.

MS MICHAEL: Okay.

MR. TAYLOR: We had a lower requirement for that this year, and – do you want to speak to that Weldon?

MR. MOORES: Treasury Board changed the fiscal year of payment on the budget. Previously it was paid to the end of December, now it runs by fiscal year.

MS MICHAEL: Right.

MR. MOORES: So, when we paid in the previous year, we already had paid for so many months into this year.

MS MICHAEL: Got it.

MR. MOORES: So, in the adjustment of the bill that is why there is such a difference between Budget and Revised.

MS MICHAEL: Revised, right.

MR. MOORES: And then on a go-forward basis, we will be back on track in the coming year.

MS MICHAEL: Right. Okay, thank you very much. Complicated but clear, actually.

Under the Revenue, 01. and 02., what would the Federal Revenue be? Did you get that $28,600 – you must not have because there is no revision, and now you are anticipating $57,200. What would that be? It is not a lot, but -

MR. TAYLOR: Go for it, Weldon, boy.

MR. MOORES: What was the question again?

MS MICHAEL: The question is, under Revenue, 01. Revenue – Federal, there was a budget of $28,600, but it looks like you did not get it because there is no revision.

MR. MOORES: Right.

MS MICHAEL: And then you are estimating $57,200, so I am curious what that Federal Revenue is?

MR. MOORES: Okay. I think that has to do with - there are some energy programs that we are running, and the money did not come in in this fiscal year but – well, $28,600 times two is the $57,000 that would be coming in the current fiscal year.

MS MICHAEL: Got it. Okay. And what about the provincial piece there?

MR. MOORES: $30,000, $40,000, $30,000.

MS MICHAEL: $30,000, $40,000, $30,000.

MR. MOORES: Okay. Again, the Provincial Revenue is made up of two components. One is the sale of tender documents. It depends on how many tenders that you put out in the run of a year, you will get more money in, and there is also some for if you have any insurance claims.

MS MICHAEL: Okay, thank you.

The next section 2.2.03., under 03., Transportation and Communications. There was a slight over expenditure there of about $30,000. What would that have been last year?

MR. TAYLOR: That is related to increased level of travel for people who were involved in our building maintenance program.

MS MICHAEL: Right. I know travel is expensive, it can add up pretty quickly.

Under 06., Purchased Services, what would be the purchased services here? It is going up. The revision went up and now this year's budget is up again.

MR. TAYLOR: Well, basically that is our building maintenance program. That would be maintenance and utility costs associated with running all of our public buildings and the increases is building maintenance at $2.5 million of the increase that you see in this coming year from the budgeted of last year; $2.5 million dollars on building maintenance and $1.24 million on energy costs, the cost of heating basically.

MS MICHAEL: Right. Under Revenue, where does that Provincial Revenue come from, the $900,000?

MR. MOORES: Some of our government buildings we have leased to third parties, so we would get revenue from these.

MS MICHAEL: I thought maybe that is what it was. Good, thank you very much.

Mr. Chair, if Roland wants to ask more questions I would not mind taking a little break. If you do not I will continue, but with my cold…

Okay, thank you.

CHAIR: Mr. Butler, we will turn it back to you, sir.

MR. BUTLER: Thank you.

I am going to backtrack a little bit, I have two or three in the sections that my colleague (inaudible).

2.1.01 –

AN OFFICIAL: What page is that?

MR. TAYLOR: Road Maintenance, page 68.

MR. BUTLER: Yes.

Item 03.Transportation and Communications, I am just wondering what the transportation would be on those figures there? It was budgeted $1.3 million and $1.2 million. What would that amount of transportation and communications, what was involved there?

MR. TAYLOR: That would primarily be related to our supervisory positions. Correct me if I am wrong, guys - supervisory positions on our Road Maintenance Program. It would be down because we did not have quite as much travel as we had anticipated, although it was only down marginally. There is a slight increase there this year because, as I said when Lorraine asked about additional costs on salaries, we are putting extra people as a result of the opening of the Trans-Labrador Highway in this coming year. There will be some increase. It will not be all realized this year, but there will be extra positions associated with that. Obviously, if we are going to have a supervisor or supervisors on that piece of highway, they are going to require a vehicle, they are going to require a Sat Phone and they are going to require gas to get around. So, that basically is the increase you see there.

MR. BUTLER: Okay, sir.

2.1.03. Maintenance and Repairs, 04. Supplies. There was a decrease of $865,800 from last year. I was just wondering what supplies were not used, or probably you did not need, or what have you for that amount.

MR. TAYLOR: This is related to our summer maintenance programs. The paint for lines, signs, guardrails and what have you, and obviously we did not spend quite as much as we had anticipated. It was spent somewhere else. This would provide also for the purchase of hot asphalt, for example, or cold patch, or whatever. Hot asphalt, obviously, if there is an asphalt plant in proximity to the work that needs to be done or a cold patch for in the winter, or other times of the year. Obviously, it would have been spent somewhere else, but it would have been spent on supplies for the summer maintenance program.

MR. BUTLER: Okay.

Why would that have been, because the time frame was not there to do it or the request did not come in for it, or?

MR. TAYLOR: I do not know. It could be any number of reasons from – I believe that the cost of paint, for example, was less than anticipated but there are other factors that might come in here. In some areas of the Province, because people are off on leave or decided to take a leave of absence and go to Alberta to work for the summer or whatever, we do not get – I know Beth continuously complains about the guardrail repair in this region, and rightly so. We just, for whatever reason, do not have the staff and whatever.

MR. SMART: The other thing that we do on occasion is when we are awarding a major road contract in an area to do twenty or thirty kilometres of road, we would include in the contract to have the contractor do the guardrail, do the signs. That would decrease the pressure on our guys because we just have so much to do anyway. So you could see a shift in some of the work over into some of the big road contracts. Seeing as they are out there doing the pavement anyway, it is just as well for them to do some of the other things. So some of that cost that would have been saved here, you will see it spent over on the contract.

MR. BUTLER: Yes.

2.1.04. Snow and Ice Control; the increase in the Salaries here. I was just wondering, is some of that due to the twenty-four-hour program that was extended this year? That would not be in addition to that?

MR. TAYLOR: No.

MR. BUTLER: Okay.

MR. TAYLOR: You were not paying attention when Lorraine asked that same question, were you?

MR. BUTLER: No, I did not.

MR. TAYLOR: This is not like Question Period, now. You are supposed to pay more attention in the night than you do in the day.

MR. BUTLER: That is when I was out in the washroom.

MR. TAYLOR: No, the twenty-four hour snow clearing would have already been built into that $14,600.

MR. BUTLER: Okay.

MR. TAYLOR: And the rest of it, the $16 million would have been like overtime and stuff like that.

MR. BUTLER: I will read the minutes when they come out.

MR. TAYLOR: Read Hansard tomorrow morning.

MR. BUTLER: 2.2.04., Rentals.

MR. TAYLOR: Rentals, yes.

MR. BUTLER: Purchased Services 06., $1,151,400. I was wondering what services would they have received under that purchase of services there?

MR. TAYLOR: Who can answer that, Weldon or Gerry?

It is probably related to – I do not know, can somebody answer that? It is probably related to where, under this section you would be, as it says here: "Appropriations provide for the leasing costs incurred by the Department and for moving, alterations, modifications and minor maintenance expenses related to all Government leases."

So it is probably related to just a lease on a building or the rental of equipment in order to do modifications or whatever as part of our maintenance program, but it probably includes, my guess, the boom truck that you see from time to time out here swinging stuff up so that we can get those elevators that do not work very well, fixed, that kind of thing.

MR. BUTLER: Yes.

2.2.05., Salt Storage Sheds. I know there was one announced for Upper Island Cove in my booklet but it was supposed to be Lower Island Cove. Are there others this year? The figure there under 06., in that section says $2.4 million. There must be other facilities.

MR. TAYLOR: Yes. Depending on how the bids come in and what have you, and the size of the structure and where they are and whatever, but that typically will get us five or six new structures. We have some that are very needing of repair.

MR. BUTLER: 2.2.06, Building Acquisition: There was nothing budgeted. It was revised to $700,000 and nothing estimated again this year. I am wondering if you can give an explanation on that.

MR. TAYLOR: Fair enough. That is pretty straightforward, actually. The Fagan Building is adjacent to the Court of Appeal? Anyway, down by the courts. It is judges' offices, and the gentleman, as I recall, who owned it, is in the process of retiring and decided that he wanted to get out of the business. The opportunity came up for us to buy it at what we believed to be a fairly reasonable amount, considering it is on Duckworth Street, and so we bought it. We had not anticipated it, but we found money in savings. I do not know where that $700,000 got transferred from, but I am sure it was cobbled together from some other part of the department and transferred over there to complete the acquisition.

MR. BUTLER: 2.3.02, Equipment Maintenance: under Supplies there is an increase there of $3.196 million.

MR. TAYLOR: Where are you now, Roland, I am sorry.

MR. BUTLER: I am sorry. 2.3.02, Maintenance of Equipment, under 04, Supplies.

MR. TAYLOR: Yes.

MR. BUTLER: The Budget was $12.5 million and it went to $15.7 million.

MR. TAYLOR: That is related to higher fuel costs that we experienced last year, and replacement parts for our fleet. This year, we have provided for increased costs there, for the vehicle component parts and other supplies, of $1.7 million.

MR. BUTLER: 2.3.03, Equipment Acquisitions: I was just wondering if you could give a list of what that equipment would have been. That $10.5 million, what would that entail?

MR. TAYLOR: Essentially, that will get us, on average, thirty plow trucks. I think we bought a couple of snow blowers last year, in the last fiscal year, that is, a couple of snow blowers and maybe a front-end loader or whatever. I mean, that is the kind of stuff that we would buy with it.

That is the $10.5 million where the underguards for the trucks will be included.

MR. BUTLER: Good job.

3.1.01, Administrative Support and Design, 09, Allowances and Assistance, $613,100.

MR. TAYLOR: Yes, okay.

MR. SMART: That relates to the settlement of a claim, actually, that goes back to when we put the Trans-Canada Highway through Grand Falls-Windsor and divided the highway. When we do that type of thing and we affect businesses, they can make claims for injurious affection and so on. This is actually the settlement of two claims in relation to when we put the highway through there. It is a legal settlement that we did not budget for, but seeing the opportunity was there to settle it we found the money to settle it.

MR. BUTLER: Subhead 3.2.03., Improvements – Provincial Roads, 06., Purchased Services, $64 million: I am just wondering if you can give me a little break down on that. I know this year it is estimated at $60 million?

MR. TAYLOR: That is our roads program. The $66,400,000 that would be there last year was actually $73 million altogether when you include the –

OFFICIAL: Capital portion as well.

MR. TAYLOR: Yes. Do you want to explain it, Bob? I mean, this capital and current and whatever –

MR. SMART: Actually, the provincial roads program that you are all familiar with is split between a couple of accounts here. It is in Purchased Services because the vast majority of the provincial roads program is delivered by private contractors through public tenders, so it is a purchased service. If you flipped over to page 77, 3.2.07., you will see another piece of the same program. This piece is capital.

Generally speaking, the way the accountants do it, remediation and fixing repairs on roads and repaving is a current account item, and building new roads and creating new assets is a capital account item. Combine those two and you get our provincial roads program.

MR. BUTLER: Subhead 3.2.04., Canada/Newfoundland and Labrador Infrastructure Framework Agreement, under Salaries: last year you spent approximately $700,000 less. Why was this? Was that jobs that were lost?

MR. TAYLOR: No. That is basically project delays. I assume one of the projects might have been the Torbay Bypass.

OFFICIAL: Yes.

MR. TAYLOR: We would have budgeted to have the Torbay Bypass underway last year, but as you know it did not get underway last year or not until late in the year anyway. I guess it was around December when we finally awarded the contract. That would be the kind of thing that would have caused that reduction.

MR. BUTLER: Under that same heading,.06, Purchased Services: this year you are estimating an increase of approximately $14 million. I was wondering what services you would be obtaining under that heading?

MR. TAYLOR: Those are similar to back in the other one that you were talking about. That is the tenders for the roads, the awarding of work to the private contractors under the cost-shared funding.

MR. BUTLER: I will go to a couple of general questions now to get away from those one-liners.

How many seasonal part-time employees do you have within your department, approximately?

MR. SMART: Twelve hundred.

MR. TAYLOR: Bob said it is 1,200.

MR. BUTLER: Roughly how many weeks would that entail when you are talking about seasonal part-time work throughout the year?

MR. SMART: The winter seasonal operation would run from October to April and the summer seasonal operation would run from May to October. The seasonal are structured around the winter snow clearing season and summer maintenance season. They are the two seasons.

MR. BUTLER: Has there been any new contracting out of various jobs in the last year within you department?

MR. SMART: Contracting out in the sense that we would take work that would be done by our employees and give it someone else, no. We do contract out work and we contract out work when it is beyond the capacity of our existing staff.

As an example, we just contracted out the design of a bridge. We normally design all our own bridges, by our own staff, but given that we have more bridges to design than we have staff, we have contracted that out. We have not done it in any way that affects any of our employees; it is just to manage an increase in work volume.

MR. BUTLER: Okay.

Within your department: just a rough estimate of the dollar amount that would be spent by your department on advertising from all sources within a fiscal year.

MR. SMART: In terms of advertising, I will not give you the number but I will tell you what we spent it on. I will get you the number later. We advertise to hire people, new jobs. We advertise tenders in the paper when we are calling contracts. We have a Snow Means Slow campaign, and we have a couple of other campaigns where we are encouraging people to drive safely and so on. That is the extent of our advertising. You know, I can get you a number of what that all adds up to.

MR. BUTLER: Okay.

MR. ANTLE: Advertising is around $257,000, which now has moved over to the Public Service Commission's budget. That is for recruitment and so on.

The other advertising that you will find is, if you looked under Technical Support Services, which is section 2.2.02, in there, under Purchased Services, there is advertising for tenders that you see in the paper. That amount is around $178,000.

That is the total for the department in advertising, those two items.

MR. BUTLER: Thank you.

Really, all the funding, and I think we touched on that a few minutes ago, like funding that is allocated for maintenance in the summer, whether it is for staff - we know that – but supplies and everything, that is usually used up. Like you said, last year there was some left over and transferred. I would not say that happens too often, does it?

MR. TAYLOR: Money left over?

MR. BUTLER: Yes.

MR. TAYLOR: No, I would not think.

MR. BUTLER: Because you mentioned about the summer maintenance last year. There was so much that was not used, right?

MR. TAYLOR: Well, it was not used there.

MR. BUTLER: It was used somewhere else, yes.

MR. TAYLOR: Well, it remains to be seen where it was used, from my perspective anyway, but as Bob said, it may just have been that it was transferred over as part of some other program, and still ended up getting spent on guardrails, for the sake of argument.

MR. BUTLER: 3.2.05, Canada/Newfoundland and Labrador Infrastructure Framework Agreement, under Salaries, last year it was Budget and Revised the same $250,000, and this year you have it estimated at $1 million. I was wondering if you could explain that. Is that new jobs, and how many new jobs would that be.

MR. TAYLOR: That is the salary component for the 2009-2010 projects under the cost-shared piece. Because we expect that we will be doing more work this year under the cost-shared program than we had last year, the Salary component of it, we will need more people to administer it and what have you.

MR. BUTLER: I guess that is the same reason, because of 05 and 06, Professional Services and Purchased Services?

MR. TAYLOR: Yes.

MR. BUTLER: There is quite an increase there as well.

MR. TAYLOR: Yes.

MR. BUTLER: Lorraine, you wish to go again?

MS MICHAEL: It has been a long day with a lot of talking today, so the cold is increasing.

Let me see where I was. Okay, 2.3.02, and I am not asking what Roland asked, I have a couple of other ones. I am paying attention.

Under 03, Transportation and Communications, there is quite a difference there. Last year the revision was quite high. Why in this area would that have happened? Would that be movement of equipment?

MR. TAYLOR: Under Transportation and Communications?

MS MICHAEL: Under Maintenance of Equipment, 2.3.02.

MR. TAYLOR: Yes.

MS MICHAEL: Yes, Transportation and Communications.

MR. TAYLOR: Yes, the 03 line in that section.

MS MICHAEL: Yes, it says 03 for some reason.

MR. TAYLOR: That is related to travel and communication costs for staff.

MS MICHAEL: Why would have gone up so much last year? Any idea?

MR. TAYLOR: My understanding is that it would have been to attend training sessions.

MS MICHAEL: For maintenance?

MR. TAYLOR: Yes.

MS MICHAEL: Is that related to the recruitment as well?

MR. TAYLOR: No, not necessarily. We have, over the course of the past couple of years, put a fairly significant focus on occupational health and safety issues within the department.

MS MICHAEL: Right.

MR. TAYLOR: I am assuming that this would be a piece of that. This increased spending would reflect that.

MS MICHAEL: Thank you. Good thing to spend it on.

Under Revenue, the Provincial Revenue, the revision last year was right down to $60,000, but this year it is back up to $350,000. What would be the Provincial Revenue there?

MR. TAYLOR: Is this the revenue related to doing work for other departments, vehicle repairs for other departments?

MS MICHAEL: Oh, that sounds logical.

MR. TAYLOR: It is just an accounting thing. We do work for Government Services on their vehicles and they pay us.

MS MICHAEL: Okay. I figured it was something like that actually.

Okay, 3.1.01: the salary answers seem to be the same all the time. Bob warned me of that, so I will not ask again.

Under 06, Purchased Services, a little jump, the revision was a little jump. What would that have been?

MR. TAYLOR: That would have been related to additional costs for repairs to vehicles.

MS MICHAEL: Okay.

Where you have to get repairs done outside?

MR. TAYLOR: Yes.

MS MICHAEL: Okay, great.

3.1.02., Employee Benefits revision must have been something that you sent some people to was it, because you had nothing budgeted?

MR. TAYLOR: Yes, that is right. It was conference costs. I do not know what kind of a conference that would have been but that is what it would have been related to.

MS MICHAEL: Okay, that is project management stuff.

3.2.03.05. Professional Services; the revision was $125,000 higher than anticipated. What would that have been?

MR. TAYLOR: That would have been related to an increase in costs associated with consulting fees, like engineering firms and what have you, for design work.

MS MICHAEL: Right.

MR. TAYLOR: We may have run into a spot similar to what Bob said just now, where we were doing a bridge and we just did not have the capacity internally to be able to do the design, for whatever reason, and we would have hired somebody outside to do it.

MS MICHAEL: Right.

3.2.04.05. Professional Services; again, that went up as well last year the revision. Is it a similar thing?

MR. TAYLOR: Again, that would have been related to an additional requirement for consulting engineering type. It might never have been - I should not go as far as to say that it was an engineer, for example, but it would have been for some kind of consulting firm like that.

MS MICHAEL: That you did not have inside the department.

MR. TAYLOR: Yes. More than likely from an engineering perspective, in the meantime.

MS MICHAEL: Right.

3.2.05.03. Transportation and Communications; it has been $35,000 both the budget and the revision but this year going up to $150,000. Why the big jump this year? What do you anticipate?

MR. TAYLOR: It is just reflective of how much more of this cost-shared money we will be spending this year than we had spent last year. Take, for example, the Torbay Bypass road is going to be done this year. Items like that - heightened spending on the Trans-Labrador Highway from a cost-shared perspective, those types of things.

MS MICHAEL: Okay.

04. Supplies, that is the same thing, I take it?

MR. TAYLOR: Yes.

MS MICHAEL: It is under the joint agreement and you have the projects that would be happening under that. I would suspect the next one is the same?

MR. TAYLOR: Yes, that is correct.

MS MICHAEL: Okay, great. That makes it easy.

3.2.07., that is a strange dip there in 01. Salaries, from $300,000 revised to $92,000.

MR. TAYLOR: Yes, that would have been related to lower than anticipated engineering costs associated with our Provincial Roads Program.

MS MICHAEL: Under Salaries?

MR. TAYLOR: Yes.

MS MICHAEL: Really. Okay. So that would not be a purchased service or a professional service?

MR. TAYLOR: Somebody want to explain this?

MR. SMART: On our major projects we charge part of the cost of our own staff off to the project. As part of doing that project, is we assign an engineer to it and charge that cost off to the project. So what you see here, these costs are ones that we charged off to projects.

MS MICHAEL: Okay. So this year you – well, you put in the anticipation that you will cover it all but that might be charged off also?

MR. SMART: Yes.

MS MICHAEL: Okay. Thank you.

Purchased Services, again there was a high budget and revised downward. Was that because some project did not happen that you anticipated? If so, it is still not happening from the looks of this year's Budget.

MR. TAYLOR: Do you want to go for that again, Bob?

MR. SMART: Yes, it relates to the level of activity in the roads program. If we do not complete projects in the given fiscal year, than we can charge the full cost off to the project and it flows over to the next year.

MS MICHAEL: Right, or does it possibly become money that you also use in – like there were a couple of places here where you spent money that you had not anticipated, and that would come from that kind of thing as well?

MR. SMART: Oh, yes. We do not give back much money.

MS MICHAEL: No.

MR. SMART: If we do not spend it in one area, we always have marine, we always have buildings, we can find a use.

MS MICHAEL: Okay, great.

Under the same section 07., you budgeted $1 million last year and only spent $50,000 and now this year it is up to $700,000. That is quite a drop there. What happened or what were you anticipating?

MR. SMART: That relates to our weigh-in motion sensors. We are installing in four locations on the Trans-Canada weigh-in motion sensors which will measure the weight of trucks as they cross over them at normal highway speed of 100 kilometres an hour and also have the capacity to take a picture of both a side view and a licence plate view of that truck. So, it is an effort on our part to beef up detection of overweight vehicles on our highways. We just did not get it done last year. It will be fully installed this year.

MS MICHAEL: Right, great.

Thank you very much.

MR. TAYLOR: (Inaudible) you see those poles that are just being stuck and lines that are being strung? That is what that is.

MS MICHAEL: That is what that is, okay.

MR. TAYLOR: Yes, and similarly out on the CBS Bypass.

MS MICHAEL: Now, 3.2.08 Canada Strategic Infrastructure Fund. This is joint with the federal government. How many years – did this only start last year or is it a longer program than that?

MR. TAYLOR: No. We are in the process of winding down that now. We have just recently identified how we are going to spend the final few dollars that will be left in that fund. That fund is, I do not know if replaced is an appropriate way of - but it is being replaced by the Building Canada Fund and communities fund, whatever. So, this is pretty well the end of this program here. This is what the Team Gushue Highway would be built out of, for example, amongst other things. Team Gushue, yes, but Torbay Bypass is what I meant to say in the meantime.

MS MICHAEL: Right. So the $7 million will basically - the revenue this year from the feds, that will basically be it in this category?

MR. TAYLOR: In this one, yes.

MS MICHAEL: Yes, okay. Good enough.

MR. TAYLOR: It will still show up in next year's budget because I think we still –

MR. SMART: The projects will be selected but it will be another year there.

MS MICHAEL: Okay.

Under 04. Supplies, you had $350,000 budgeted and the revision was $50,000 and now up to $350,000 again. What would be the – it would be the construction supplies I guess, would it, the supplies for construction?

MR. TAYLOR: Yes, it would be. Again, the reduction was because we thought the Torbay Bypass would have been underway earlier and as I said before, it did not get going as quickly.

MS MICHAEL: Yes, and that will explain the next two items there?

MR. TAYLOR: Yes.

MS MICHAEL: Okay, great.

3.2.09, the Trans Labrador Highway. I guess this is the same thing; there were things that you anticipated that did not happen last year?

MR. TAYLOR: Yes, we ran into a few delays on the Trans-Labrador Highway last year. There was a heavy amount of bog ran into in some areas.

On the salaries piece, Bob, I do not know if you need to explain it any more than that, but we did have obviously a lower than anticipated expenditure there but I think it was probably recovered somewhere else on engineering?

MR. SMART: Well, it all relates to the level of activity on the project. As the minister said, we ran into delays. We got a significant number of projects started. We spent $50 million-odd but still, we had intended to do more. If we do not complete the project we cannot charge off as many salaries to the project and it will carry over to the next year.

MS MICHAEL: Right.

Now, under the Professional Services, it was revised to $6 million. Did $6 million get spent?

MR. TAYLOR: That was what I was getting at, I think.

MS MICHAEL: Okay.

MR. TAYLOR: Part of the problem that we have had here is typically, if we were doing this on this project, we would have our own staff for example, that would provide the engineering services on the ground.

MS MICHAEL: Right.

MR. TAYLOR: And for a variety of reasons, primarily location, we have not been able to keep our own people in to manage this project and as a result of that we had to contract it out. You might have heard me there a little while ago speak about our difficulty in obtaining engineers, particularly in Labrador and recruiting them for our staff, and this is basically what this reflects.

MS MICHAEL: Right.

MR. TAYLOR: So we had to go and contract this out to a private company and they essentially operated the engineering of this, similar to any mining camp operation, two weeks in and two weeks out type of setup.

MS MICHAEL: Right.

MR. TAYLOR: So that is the Professional Services that you see there.

MS MICHAEL: Okay. And I guess Purchased Services is somewhat like that in terms of an anticipation this year of more activity there for the money going up?

MR. TAYLOR: Yes.

MS MICHAEL: Okay, thank you.

Land Acquisition, 3.2.10; $7,500,000 down to $3,500,000 and up to $5,000,000. What is involved there? What is it, Property, Furnishings or Equipment?

MR. TAYLOR: No, that would all be related to land acquisition for the continuation of Team Gushue Highway, the East-West Arterial, whatever you want to call it, and the Torbay Bypass.

MS MICHAEL: Okay.

MR. TAYLOR: We would have anticipated spending $4 million more than we spent last year on land acquisition, and what we have built in there this year is just a continuation of land acquisitions so that we can eventually complete the Torbay Bypass. It might be a cash flow item issue for this year, but also probably to purchase some land on the route of the East-West Arterial, Team Gushue Highway.

MS MICHAEL: Okay.

Subhead 3.3.01., under Salaries, there is quite a difference here between the budget and the revision for last year. What might have caused that?

MR. TAYLOR: That would have been higher than anticipated salary costs for project administration on alterations with our buildings.

MS MICHAEL: Okay.

So you are sort of going back down to what you normally would expect this year.

MR. TAYLOR: Yes.

MS MICHAEL: Right, okay.

Under Professional Services, would that be related to your own buildings as well?

MR. TAYLOR: That would be related to our own buildings and that would be related to increased fees for consulting engineers. For the sake of argument, grab a company name - BAE Newplan, for example - the cost of hiring them to do design and project management, somebody to administer, for example, the remediation of the old Janeway site down there, so we would engage an environmental firm to oversee that project for us.

MS MICHAEL: Okay.

Do you want to take over, Roland? Do you have more questions?

MR. BUTLER: Just some one-liners, that is all.

MS MICHAEL: Okay, that is fine.

CHAIR: Okay, we will move back to Mr. Butler.

Carry right on.

MR. BUTLER: Under subhead 4.2.02., Salaries, you are estimating $1 million-plus more than was budgeted last year. I was wondering if you could provide a list. Is that new jobs that we are talking about here? If so, how many would that be?

MR. TAYLOR: Well, this is related to changes in the operating schedule so there will be some additional costs there as a result to changes to operating schedules, increased overtime and increased costs for benefits under the collective agreement as a result of issues around banked hours and vacation pay, vacation bonuses.

MR. BUTLER: Under Supplies, $6.6 million and the revised was $8.6 million. I was just wondering if you could explain what that might have been.

MR. TAYLOR: That is basically increased fuel and parts costs associated with operating the vessels.

MR. BUTLER: The revenue portion there, you budgeted $1.2 million but it was revised at $2.1 million. Would that be from fees or…?

MR. TAYLOR: Believe it or not, we made more money off fares than we anticipated even though, as you know, there were substantial reductions in fares.

MR. BUTLER: I was going to say, there was a reduction. More travelling, I guess.

MR. TAYLOR: I do not know what that tells us; we are not sure. We are a bit surprised at it ourselves, to tell you the truth.

MS MICHAEL: You will have to reduce it more so you can make more money (inaudible).

MR. TAYLOR: Yes, evidently.

We did end up spending $2 million more than we had – while we might have made $1 million more, we spent $2 million more than we had anticipated running them, so….

MR. SMART: In terms of the revenue, we went through two significant rate changes. We first of all significantly decreased the passenger fares in one year. Then last year we significantly overhauled and reduced all the freight rates.

Between the interplay of changing so many fares and some increasing in ridership it is difficult to project exactly what the impact is going to be. I do not think there is any doubt that if you make the fares on the vessels lower, particularly for freight, it will encourage people to ship more; it gets cheaper. It is virtually free now, the rates are so low.

MR. BUTLER: Under 4.2.03., Coastal Labrador Ferry Operations, Supplies, that is another huge number there of $6.5 million to $9.3 million. I was wondering if you could give me a breakdown on the type of supplies noted there.

MR. TAYLOR: That is all related to fuel.

MR. BUTLER: Fuel?

MR. TAYLOR: Yes.

MR. BUTLER: Under 06. Purchased Services, there as an increase of, I think it was, $3.4 million?

MR. TAYLOR: That is two parts.

MR. BUTLER: That is the estimated cost.

MR. TAYLOR: That is related to refits on the Sir Robert Bond and the Northern Ranger, as well as the CPI adjustment as part of the contract. The Consumer Price Index adjustment, each one of the contracts – I guess each one – have that build into it, so each year there is an adjustment in the amount that we are paying.

MR. BUTLER: Okay.

Under that same heading, the $3 million for Revenue, is that the same answer as we got before?

MR. TAYLOR: Yes.

Like I said, now, the same thing in the previous one, it cost us another $3 million to run them, over and above what we had anticipated, for parts and fuel this year, even though we made $2 million. So, if you look at both of those, if you look at the two of them, we made $3 million more than we had anticipated but we lost $5 million more than we had anticipated.

MR. BUTLER: Under 4.2.04., Ferry Terminals, under 06. Purchased Services, the Budget was $1.4 million and the Revised was $200,000, and it is back up to $1.4 million again this year.

MR. TAYLOR: That is related to project delays for some of the work that we were going to do on our ferry terminals. I am not sure which ones might have been delayed, but that would be the problem.

MR. BUTLER: Would the Purchased Services under 4.2.05. be the same thing in that one as well? The first one was Current, this one is Capital, $5.5 million.

MR. TAYLOR: The same thing.

MR. BUTLER: Under 4.2.06. under Property, Furnishings and Equipment, your Budget was $33 million. It went down to $11 million and this year it is estimated at $43 million.

MR. TAYLOR: That is the two new boats.

MR. BUTLER: That is where that comes in.

MR. TAYLOR: Yes, that is the delay where we thought we would have the contract straightened out beforehand. As you know, it was announced last June or whenever and we thought that substantial construction would have taken place in the last fiscal year. Obviously, it did not and we are anticipating $43,500 worth of construction this year.

MR. BUTLER: Under 4.3.02., Government-Operated Aircraft, under 06. you budgeted $1.8 million and the revised was $900,000. Now, this year, it is $2.1 million again. I was just wondering if you could give me a breakdown why, I guess, only half was spent what was actually budgeted.

MR. TAYLOR: Basically, it did not cost us as much to keep our aircraft repaired and operational in the past year as we had anticipated, and this year this is reflective, the $2.1 million, of whatever requirements are associated with Transport Canada on our aircraft this year, our anticipated refurbishment costs, maintenance costs.

MR. BUTLER: Under number 10., Grants and Subsidies, the $2.8 million, I was just wondering if you could give me a rundown of what the grants and subsidies would be under that heading.

MR. TAYLOR: I can. It almost looks like there was a plane that somebody must be operating for us.

MR. ANTLE: Yes, that is the operating grants for Grenfell Health Services, the Labrador Health Care Board.

MR. BUTLER: Under 02., the Revenue under that same heading, Revenue – Provincial, $2.8 million, what does that derive from? It was the same last year and again this year.

MR. ANTLE: That is the charters and the medevacs that we offer, I guess. We incur the cost but then we rebill the health authorities for their share, like Eastern Health, Western, and so on.

MR. BUTLER: The last couple of questions that I have are under the last heading, 4.3.03. My first one is under number 07. there, where it says Property, Furnishings and Equipment. The Budget was $38 million and the Revised was $7.6 million.

MR. TAYLOR: That is no new water bombers. That is essentially what it is, isn't it?

OFFICIAL: A new ambulance.

MR. TAYLOR: A new air ambulance at $7.6 million, and the remainder of the money we would have anticipated to have spent on – was built into the framework on beginning the process of replacing our water bomber fleet. As you know, we have not gotten around to that yet.

MR. BUTLER: So, suffice it to say it will not be done again this year because there is nothing estimated.

MR. TAYLOR: Well, it is not in there. I mean, we thought we were going to. We were working very diligently with Bombardier on a contract, and we were almost there. I think with the downturn, it is fair to say, in the economy - and you heard about Bombardier's layoff plan a couple of days ago. A number of the items that we agreed to, they, upon reflection, decided that they could not live up to their end of the bargain and walked away from the table, essentially.

MR. SMART: Just in addition to what the minister said.

One of the things about buying water bombers, even though you are buying them from Bombardier, a Canadian company, water bombers are purchased in American dollars. So when the Canadian dollar declines below eighty cents the cost of purchasing water bombers goes up proportionately. So that is a big factor here, to be buying these at a time when the exchange rate is a bit more in your favour than it is right now.

MR. BUTLER: I was going to say, Mr. Chair, that is my last question, but he is not there – here he comes.

MR. TAYLOR: I am not here (inaudible).

MR. BUTLER: So I will pass it back to my colleague from Signal Hill-Quidi Vidi.

CHAIR: Ms Michael.

MS MICHAEL: Thank you very much, Mr. Chair.

I just have a few more. We have to go back to 3.3.02., Development of New Facilities, and Purchased Services 06. $3.1 million was budgeted, revised down to $1 million, now up to $4.7 million. What is that all about?

MR. TAYLOR: Okay. We were planning on new depots on the Trans-Labrador Highway, $3.1 million was what we had budgeted to spend last year. Due to construction delays, problems, what have you, we only got a million of it spent, and we anticipate – well, not anticipate, we have no choice.

MS MICHAEL: Right.

MR. TAYLOR: They have to be done this year for the opening of the Trans-Labrador Highway in the fall.

MS MICHAEL: Okay, thank you.

4.1.03.06., Purchased Services – this is Airstrips. You revised down, and now this year going up to $987,000. What is anticipated there?

MR. TAYLOR: This would be related to the Labrador airstrips improvement program, and last year it would have been decreased and reallocated to other projects. This year it is back up because of plans for, I guess, a more aggressive improvement program in Labrador airstrips.

MS MICHAEL: Are all of them being done or just some?

MR. TAYLOR: Pardon?

MS MICHAEL: Are all of the airstrips being done up there or just some of them?

MR. TAYLOR: I would not imagine it would be all of them. These would be, I would say, probably more related to the north coast airstrips.

MS MICHAEL: Okay. Thank you.

4.1.04., you had $820,000 allocated for Purchased Services for the airstrips last year, that did not happen, and nothing estimated for this year. What was that all about?

MR. TAYLOR: What was that one again?

MS MICHAEL: 4.1.04.

MR. TAYLOR: Go ahead, Weldon.

MR. MOORES: Actually, 4.1.03. is the current component –

MS MICHAEL: Right. Oh, and that is the capital –

MR. MOORES: - and 4.1.04. is the capital component, so you have to read the two of those together.

MS MICHAEL: Yes, I just realized.

There is work going to be done under the current, but there is going to be no capital expenditures this year?

MR. MOORES: That was our best guess at budget time.

MS MICHAEL: Okay, so you are not sure.

MR. TAYLOR: The capital side of it would be for new pieces, so to speak, new components. So for the sake of argument, if we were going to do something substantial with Port Hope Simpson that would be where that would show up, but if we are just going in to fix the roof on a building in Nain or something like that, then it would show up in the previous one.

MS MICHAEL: Okay, so you are not anticipating anything this year then, that is what I am getting at.

MR. TAYLOR: Yes, that is correct.

MS MICHAEL: Okay.

Under 4.2.01., come down to 06. Purchased Services. Again, the revision was not extremely high but there was about a $70,000 revision. What would that have been, please?

MR. TAYLOR: My understanding is that is related to printing, higher printing expenses than we had and miscellaneous purchases.

Paul, do you want to give a try at that?

MR. ALEXANDER: What it mainly includes is brochures advertising ferry schedules.

MS MICHAEL: Okay. Thank you.

4.2.02., Transportation and Communications. You had a big jump in the revision last year to $326,200. It was a one-time jump from the looks of it, what was that?

MR. TAYLOR: That is where we cover the transportation costs for ferry workers when our vessels are on refit. I think you can see from that that we probably spent longer on refit than we had anticipated.

MS MICHAEL: Yes. Definitely with that cost you did. You had a number on refit last year though didn't you?

MR. TAYLOR: Pardon?

MS MICHAEL: You had a number in refit.

MR. TAYLOR: Yes.

MS MICHAEL: For periods of time, right.

The same section, Purchased Service – no, that is what we just did, wasn't it?

MR. TAYLOR: No, Transportation and Communications.

MS MICHAEL: Yes. What would be the increase there in the revision?

MR. TAYLOR: In the Purchased Services?

MS MICHAEL: Yes. It was $1.6 million more in the revision.

MR. TAYLOR: That is related to higher than anticipated refit costs. We have been seeing that happen fairly frequently and I would bet that 2009-2010 number that you see there right now is going to be higher than that when the revised number comes out next year.

MS MICHAEL: Right. Okay.

MR. TAYLOR: If it does not I will be surprised, given our experience so far.

MS MICHAEL: Section 09. Allowances and Assistance. I am just curious, what would that $10,400 be? Nothing was budgeted and nothing is budgeted but there was a $10,400 under Allowances and Assistance.

MR. SMART: If I may, that was a settlement of a damage claim.

MS MICHAEL: Okay, thank you.

I only have a couple of more left. There was one curious one. Oh yes, 4.2.04. The salary is $40,000 and you only spent $5,000. So what exactly is that about under 4.2.04. for Ferry Terminals?

MR. ALEXANDER: In a few locations we actually hire under contract someone to catch our lines when we berth our vessels. So, this would be the cost here.

MS MICHAEL: All right. Very good, thank you.

MR. TAYLOR: (Inaudible).

MS MICHAEL: Okay and I am going to guess that Transportation and Communications is helping people get around to do that. You are nodding; maybe I should not be guessing I should ask you.

Under 4.2.05. - and that will be all my questions once I ask it. Transportation and Communications, you budgeted $100,000 but you only spent $15,000. So why are you going back up to $100,000, or was the $15,000 revision an anomaly?

MR. ALEXANDER: Actually, I am going to defer that to my colleague in the back here.

MR. GOSSE: That is just reflective of the total amount of work we did in that component of the program.

MS MICHAEL: Would that be the same for the salaries as well, that there was very little work done in that area that was planned but did not happen?

MR. GOSSE: That is correct.

MS MICHAEL: Okay, because the salary was only $50,000 as well. Then I would imagine it is the same for all of it then, the services and the supplies.

I think that does it, Mr. Chair, for my questions.

MR. BUTLER: Mr. Chair, just one question.

CHAIR: Yes. Mr. Butler has one more question.

MR. BUTLER: With regards to, I know when the winter maintenance is over and the summer program kicks in - I am not going back to the thirteen depots because that is in court, but there are no changes, none of the winter ones will remain open any different than what it was last year, is it?

MR. TAYLOR: No.

MR. BUTLER: That is it.

CHAIR: Okay, thank you very much.

I will ask the Clerk to call the - is everybody finished, no more questions?

CLERK: Subhead 1.1.01. to 4.3.03. inclusive.

CHAIR: Shall 1.1.01. to 4.3.03. all inclusive carry?

All those in favour, 'aye'.

SOME HON. MEMBERS: Aye.

CHAIR: All those against, 'nay'.

On motion, subheads 1.1.01 through 4.3.03. inclusive carried.

CHAIR: Shall the total carry?

All those in favour, 'aye'.

SOME HON. MEMBERS: Aye.

CHAIR: All those against, 'nay'.

On motion, Department of Transportation and Works, total heads, carried.

CHAIR: Shall I report the Estimates of the Department of Transportation and Works carried without amendment?

On motion, Estimates of the Department of Transportation and Works carried without amendment.

CHAIR: Can I have a motion to adjourn the meeting, please?

There is an argument over who is going to adjourn the meeting. I think Terry was first and Beth was second.

Thank you very much. Thanks Minister, thank you to your staff.

MR. TAYLOR: Thank you.

On motion, the Committee adjourned.