The Committee met at 7:00 p.m. in Room 5083.

CHAIR (Canning): Order, please!

Welcome, Minister. This is the Estimates Committee hearing for the Department of Fisheries and Aquaculture. I would invite you to introduce your staff and make a short presentation if you wish. Then we will get on to questions.

First of all, seeing that this is (inaudible), perhaps we should just go around the table and introduce, for the purposes of Hansard, the various members on the Committee.

MR. WOODFORD: Rick Woodford, Humber Valley.

MS THISTLE: Anna Thistle, Grand Falls-Buchans.

MR. BARRETT: Percy Barrett, Bellevue.

MR. SHELLEY: Paul Shelley, Baie Verte. Roger Fitzgerald will be here in a second, and Tom Osborne is unavoidably absent.

CHAIR: My name is Perry Canning, the Member for Labrador West. Mr. Minister.

MR. EFFORD: To my far right is David Lewis, CEO of Fisheries and Aquaculture, policy planning; Les Dean is the Deputy Minister of Fisheries and Aquaculture; and Frank Pinhorn is the CEO of fisheries development.

CHAIR: Minister, if you would like to make a short presentation you can, or we can get directly into questions.

MR. EFFORD: I thought there was a motion (inaudible).

MR. SHELLEY: There is no motion, boy. You just feel like you are swaying, that is all.

MR. EFFORD: He is some lucky I am not in that chair out there.

MR. WOODFORD: You get into emotion now and (inaudible).

MR. EFFORD: Mr. Chairman, I am going to take just a few minutes to make some opening comments. There are prepared notes in front of me, but that will be for the viewing of everybody who wants to read them afterwards. I am just going to take a few minutes to talk about what we have responsibility for and what we are doing in the Department of Fisheries and Aquaculture.

I think I will begin this way. Since the closure of the groundfish industry in 1992, while the ill wind blows a lot of despair and frustration into people's lives, I term it as this. There was some good that came out of that. People, not only in the Department of Fisheries and Aquaculture, but people in the fishing industry around the Province of Newfoundland, looked at diversification, looked at other opportunities, (inaudible) in the traditional fishery, in the aquaculture industry, and in particular in underutilized species. The world is changing rapidly every day and new technology, research and development are happening at a rapid pace. As a result of the closure of the groundfish industry the Department of Fisheries and Aquaculture have turned their attention to other opportunities in the ocean.

The one thing that most people think today is that there is no fishery taking place in Newfoundland and Labrador. In fact, I just briefly chatted with some people from across Canada at the annual report of the FPI company yesterday down at the Delta Hotel, and I spoke at (inaudible) out in Topsail last night at a church social. When I tell people that in 1997 we had an export value of $575 million worth of fish, approximately 21,000 people received employment out of that industry, people just open their eyes with surprise: Gee, I thought there was no fishing industry in Newfoundland. Really, except for the groundfish industry, the fishing industry is alive, it is well, and we have developed a lot of species that we normally would not have developed probably if we were depending on the traditional fishery. The closure of the groundfish industry caused people to stop, think and to look at other opportunities.

Of course, to add to that, once the codfish and the groundfish collapsed nature falls in place, and because of the low groundfish stocks, the shrimp fishery and shellfish industry seemed to climb at a rapid pace. As a result, in 1997, for the first time in the history of Newfoundland and Labrador, we started to begin an inshore shrimp fishery. It was substantial last year, and this year we are hoping for a substantial increase in the harvesting, which will certainly develop increased opportunities in the harvesting and the processing industry in the Province.

The policy we have brought in is clear, and that we have been very stringent on, is that fish caught in Newfoundland, harvested in Newfoundland, must be processed in Newfoundland. If it is going out of the Province to be processed, as it was in the past to processed somewhere else, we are saying: No, it must be processed in the Province. If it is going to the consumer directly, that is a different thing altogether, and we will allow it to go as the consumer demands it. When it comes to being exported out of the Province to be processed somewhere else we have been very strict on that, and we have been saying: It's our resource, utilize it to the maximum benefit for the people in the Province. We have been very disciplined on that in all species, shellfish and the traditional groundfish and pelagics, as much as we possibly can, where the capability is in the Province. If there is not a capability then we will certainly be somewhat flexible.

The department has certainly been very determined and proactive in fisheries development. I keep referring to this. This will give you an explanation of what I am saying. The one thing that comes first to my mind is the sea urchin business when it comes to developing new opportunities in commercialized fisheries. Just right behind us over in Bell Island, five plants this winter were processing sea urchins. Just to use Bell Island as an example, approximately sixty to seventy people worked on Bell Island processing sea urchins all winter.

WITNESS: Six months.

MR. EFFORD: Six months - the first real job that has been created on Bell Island since the closure of the mine. That is developing what we called (inaudible); the new term is sea urchins. The roe that comes out of it demands an excellent price, depending on the time of the year and the quantities going to the market in Japan. Sometimes it could reach as high as $60 a kilo, but that fluctuates depending on the quality and on the demand of the product.

In the shrimp industry we have done similar things. We are developing the shrimp industry into the inshore. We have looked into pots. We brought in the beam trawl, which is proven technology on the West Coast of Canada. We have it in Newfoundland. The experimental work that we have had most recently - Alonzo Bailey in Trinity Bay last week went out in the deep hole in Trinity Bay and they averaged, in one tow, 1,000 pounds of shrimp in a thirty-five foot or forty foot boat. So the shrimp fishery is not only for the larger boats.

We have developed and spent a lot of time in research into the beam trawl for the smaller boats. Last year in Fortune Bay, in Placentia Bay, in those areas up there, they were averaging anywhere from 500 to 600 to 800 pounds per hour, per tow, in the small boats in the shrimp fishery. It is similar in other species of fish. We have put a lot of work into developing the seaweed and sea harvesting.

What we are saying, without going through all the different species, and I have been saying this, everything in that ocean is valuable. Japan buys and consumes 450 different species of fish annually. We have to look at the values of all the species in the ocean, research and development, experimental work and development into a commercial harvest, and move on from that. The opportunities are there. I am not saying we have 450 different species of fish, but let's look at what opportunities are there and develop them, and not depend on a few different species of fish like we did in the past. If nature plays its role, and the greed of man plays its role, then you know the result, that we are out of work. A lot of work is going into the underutilized species and will continue to be.

The sealing industry is being developed into a major industry; last year about $20 million in export value, about 3,000 sealers and several hundred processors, and we have only begun to tap the sealing industry. For the first time in the history of the Province we brought in a policy, we do not export it out of the Province unprocessed, which forces companies to get into the processing, the tanning and refining of oil here in the Province. As a result of that new policy, today we have a tannery in Port Union and we have one up in Baie Verte. We have another potential one (inaudible) was looking at now, getting into the same thing because of competition -

WITNESS: One in Springdale.

MR. EFFORD: - and one in Springdale. They are getting into the refining of oil, and hopefully within a year or two they will get into capsulizing that oil into the seal oil pills that we have all talked about.

They have also now developed dried seal meat into the protein capsule form that can be consumed by people in the world who cannot digest seal meat the way we do here, or in other counties in the world.

The sealing industry is a major industry for the future. We are doing it right this time. We are doing it here in the Province. We are looking at the markets, and there is a lot of work going into research and development. I am very confident, if we manage this industry right, that five or ten years down the road I can see at least a $100 million industry annually, employing thousands of people during the winter months and year round when normally people would not be working at all, as you know in Newfoundland and Labrador - January, February and March.

That industry is going to be alive and well, but I caution you: while that industry is growing, and while the markets are developing, we had better be very cautious and very careful about managing that resource. The population of seals now has gotten out of control. I am really concerned about the low fish stocks and the high numbers of seals, and my fear is that nature is going to come into play. If nature takes over and controls the overpopulated seal herd, because of the low fish stocks, we will not only destroy the seal population, we will not only destroy the fish stocks, but we will also destroy the present seal market. If a disease sets in, in the way in which nature operates, the world markets who normally buy the seal products - the oil, the protein meat and the dried capsules - will stop buying. Disease, dangerous - word spreads. The news media grabs it and you know what happens, so we have to be very careful.

Here in this Province we have to fight the world politics, we have to fight the protest groups, and we have to make sure that we don't allow that to happen. The real possibility, as you know and I know, is that will definitely happen. Because just down in California five or six weeks ago, 80,000 seal lions died, perished, starved in one week. They all died because of the lack of food. That is nature working its miraculous ways.

With an overpopulated seal herd here of over 6 million seals - conservative numbers - you know at some point in time, in the near future, that is going to happen here.

The other thing that we are very proud of in the Department of Fisheries and Aquaculture is the aquaculture industry. The mussel industry is working, is starting to explode. We have just provided a new capital loan program for the mussel industry. Now that people are starting to get encouraged by that, we will be initiating that and implementing it a few weeks down the road. I can see the mussel industry in this Province exploding to - three to four years down the road - equal to what they are doing in PEI where they are presently harvesting about $25 million worth of mussels a year.

There has been a lot of expertise and knowledge gained by the mussel farmers over the last number of years, through their own initiative. They have put a lot of work into it. They developed the mussel industry. They are now ready to start expanding their mussel operations. Like I said, I can see three or four years down the road a $25 million industry annually and about 100 farms. We have put a freeze on expanding any more mussel industries until we get the present ones up to full potential.

In Bay d'Espoir, the (inaudible) fish industry is going very, very well. We have gone over some problems we had there. Nature has caused us some problems. The marketing and financial operations of the industry have cost us some markets. We have it under control now with the work by the people, the experts in Bay d'Espoir, and all the people around the aquaculture industry. We are expecting in two or three years down the road an average of $25 million annually.

We are totally responsible for the processing in this Province. I do not want to repeat what I have already said. We have brought in some major policies in processing, where you must process all of the fish in this Province; not like it was in the past, shipping it out of the Province. We have (inaudible) some new licenses.

When I took over the department we had 245 fish plants in the Province, there was a freeze on the issuing of any new licenses, there was a freeze on transferring licenses, there was no reason to have a multi-species plant in operation in the Province. What I said was if we are going to be giving the people the longest term employment in the processing industry as is possible, there must be a policy in place that encourages people to become multi-species. Harvesters and processing cannot depend on one or two species of fish.

We have brought in a policy that you are all aware of. We have encouraged people to become core, that the plant operations become core policy, where they have to meet a certain criteria, and then they can avail of all of the species of fish that are harvested, to process it in their operations. They can give the people the sustainable employment they need in the communities.

We did it on a regional basis. Last year we had a maximum of fifty-seven core plants and about 102 total plants, pelagic, operate in the Province, where we had in the past 245 or 250 plants really telling people lies, giving a false expectation to people, saying: We will open some day, we will give you employment. We know that cannot happen.

The history of the industry in the Province was totally supported by social programs. Today not one harvester, not one processor on the Island portion of the Province, got any free money from government whatsoever. They are totally sustainable, independent operations and doing very well. It's not an income of the last resort any more, it's not built up by a social program: EI, grants, or make-work programs. The industry is becoming self-sustainable and it is working very well. People were afraid it could not happen, but we forced the policy, we were very rigid on the policy, and it is happening very well.

Quality has been a key factor with us. If we are going to stay in the world markets we have to be quality oriented all the way. From the time it leaves the bottom of the ocean and gets to the consumer table, quality, quality, quality. Handle it as if you are going to eat it yourself. If you do not do that there is no place in the work markets, there is no place in the processing, and there is no place in the harvesting industry for you.

We have put training programs on around the Province. A lot of public relations has gone on. We are talking quality, and I'm telling you now that I am very proud of the harvesters and the processing industry. They are tuning in and saying: It is about time we had it done. They are cooperating. We went to the Japanese this year, we went to the Asian market, and we went to the Boston seafood market, and we got congratulated. We got congratulated and recognized as one of the industries in the world that was starting to take a leadership in a quality product. When you get recognized in that type of market, then you know the future is going to do very well.

The final two things I want to talk about are these. There is the TAGS program. There is no need for me to elaborate on that. We all know the Province's position - the all party committee that just went to Ottawa - on TAGS, and we know what we are all obligated, as representing the people of this Province, to convince the federal government to do. I feel very confident in the next several days or weeks that we will get a good announcement on it.

The final comment that I will make is on the price problems, the negotiating problems we had over the last number of years. Four of the last five years we had delays and strikes in the industry. In particular, last year we had to jump in, the Premier and myself, and get involved, otherwise probably the industry would not have started at all. We put together a task force which went out, searched the world markets, looked at all of the problems in the industry, and made some recommendations, brought the two parties together. As a result - and you are all aware of that - of the task force, we now today are well on the way into the crab industry - fishing, harvesting and processing - and on the way into the shrimp fishery, in April, where last year in August we did not know if we were going to have an industry or not. Except for the disciplinary action and the involvement of government it would not have happened.

The task force that was put together by this government worked very well. The success of it is absolutely unbelievable. I am amazed at it myself, and I heard nothing but only good complimentary remarks from both sides of the industry. I think it has also helped to build a trust, because there was an awful mistrust between both sides of the industry. It has worked very well. It is a two-year pilot project, but the way it got off in 1998 and the way it is going today I can see it, we are going on into 1999, and then we will look on the rest in the future.

Our budget, as you can see on page 12, the gross expenditure allocation for the Department of Fisheries and Aquaculture in 1998-1999 is $18 million. Five or six years ago that was up to $28 million?

WITNESS: (Inaudible) cost-shared agreements, around $40 million.

MR. EFFORD: Around $40 million. We are doing as much or more productive work today with the $18 million in our budgetary control as they were doing back then. In fact, there are more things happening in other species of fish, and opportunities, more stabilization and more sustainable things happening in the harvesting and processing then in the days when we had a $35 million to $40 million budget.

With those remarks I will conclude. I will leave it to your comments to my colleagues around the table.

CHAIR: Thank you, Minister. I don't think anybody can challenge the type of enthusiastic supporter we have of the fishing industry as Minister of the Department of Fisheries and Aquaculture in this Province.

I would like to open debate by calling the first head, 1.1.01. Perhaps I can open by calling on Mr. Fitzgerald to begin his round of questions.

MR. FITZGERALD: (Inaudible).

CHAIR: Mr. Shelley.

MR. SHELLEY: I will start off with a few comments and a few specific questions, then Roger can take his turn.

The first thing I am going to say is that we talk about the fishery of the future. I agree that there is a lot of potential out there to do different things, but I think a big part of it is going to be the educating of the next generation that is coming, the people in schools, and the younger people that can get involved in things like sea urchins and a lot of different other things. There are a lot of people around this Province who know very little about the fishery of the future. A big part of this whole transition I believe to a fishery of the future is going to be in education. Because remember, the education of people, as far as the fishery of the past goes, was very little. Basically there was a lot of fish in the water, go out and catch it with a hook and line or net, or whatever way you can get it.

You talked about sea urchins. I want to just give you one example in my district, and I mentioned it to you. There were three or four young fellows who wanted to take a diving course and go after the sea urchins. I think that is the only way you can harvest it, is that right? Yes. They were enthused about that. They were not looking for TAGS or anything. They were from fishing families and were interested in doing that. They got turned off from it because they went to go to do that course from a group in Gander who - from what I found out - were actually training army people and so on, but the Department of Education did not recognize that particular scuba diving group. To make a long story short, and not get into the technicalities of that, these people were turned off from it. The sad thing about that is those four young fellows who were talking to me about that months back have left. They decided to forget it, it was too much trouble. They would through this appeal and then an argument, and then they just gave up on it.

If there is something in the fishery of the future for somebody who wants to go into it, it would be good if all of that ground work is done so people have the opportunity to go and do that type of thing. One example I use is sea urchins. I am sure there are other ones where there is going to be technology needed, and there are modern ways of going after whatever the species is in the ocean. Like you said, Japan has some 450 species they import. There are all kinds of examples I can give like that.

I will say this one, another comment on the fishery of the future. Let's face it, especially for people living in rural areas, unless there is something found in something related to the fishery those communities are finished. Either they find something new in the fishery of the future or they are finished, some of the smaller ones.

Brent's Cove was the name of the community, by the way, of these four young fellows. That could have been four more fellows employed in that small community who would have probably stayed there, but as a result of just one example that I gave you they moved on. The moral of the story, if you want to get at that, is that if there is a fishery of the future that we get more education on it, we get more information about it, so that people will be able to access whatever it is: sea urchins, squid, kelp or whatever. We had a problem with that.

The second thing I wanted to talk about, and very quickly - I just have five or six points I just want to brief on - is a food fishery. I'm certainly going to mention it here this evening. I have already mentioned it to Mr. Anderson outside of our meeting. I would not bring it up during the meeting of course, and I would not bring up the seal industry during that meeting, because we were trying to stick to TAGS-related issues. It was hard not to talk about it because it is all related as far as I am concerned, but I am going to mention the food fishery again this evening.

Without going on with what I have said over and over in the House, if the food fishery is closed down for all of Newfoundland and Labrador and all the Atlantic Provinces, that is end of conversation as far as I am concerned. I know that the most important thing is the commercial fishery, I agree with that, and that is the priority. It is not: Why should we have a food fishery?, but why shouldn't we have a food fishery? I wanted to state that tonight on record. I still support it for the same reason I list over and over. Be consistent with everybody and I have no problem with it.

Now I will move on to the seal industry. I have said it over and over, and I mean it, that I have studied it as closely as the minister or anybody has. As far as the seal industry goes, I have read everything that I could read about it and asked as many questions as possible over the years, not just lately. As the minister knows, Fleur de Lys is the centre of the seal hunt. I grew up around people telling me about seals all the time. I am telling you, I really believe that the seal industry could be one of the main factors to a recovery in rural Newfoundland. It is amazing. If you take out your calculator some day and just start clicking off how many capsules can come out of one seal and how many people can work on a capsulizing machine, then you talk about the hides, the tanning, the meat and everything, it is incredible the potential there is for that.

First of all, I am in total support of it. You will never get a stronger supporter. I think you have a lot of supporters on that, by the way, Minister. I believe everybody feels the same way about it, besides what it is doing with our fish stocks. We do not have to raise that. I will raise a concern about it right now. I have heard you talk many times about quality. There is not an industry more important that we want right now - like I mean last week - to have quality control present in than the seal industry, because we are just starting that. Concerning the purifying of oil, there is a professor in town today actually from France who is working on that, and I know in Roger's district they are also working on purifying oil. Quality is going to be the most important thing.

If we do not do quality control with the sealing industry right now we will lose out on it. I will raise this concern with you because it happened in my district, and it is something to be looked into for the sake of everybody because it was sealers themselves who brought it up. In my district - I will just use it for an example, but it is for the whole Province - there were a lot of seals brought into the plant in Fleur de Lys this year. A lot of people were working there, it was really active, but the plant is a bit run down. As the minister knows, we are trying to help to try to upgrade that, but I am concerned that the quality that went out of there this year maybe set a bad precedent.

I have just been asked to say that tonight by fisherman and people who work there. Certainly no one is against the jobs that came out of that, but the way it was all done and the crude fashion that it was done at the particular plant has some people concerned. What I have understood, and this is what I would like to see get checked out, is where that was sent to. We do not want quantity going over to whatever markets to make a quick buck here like we did with the other fishing industry. I would rather see one gallon going over that was purified, controlled, clean and of good quality than 10,000 gallons go over.

There were some concerns raised to me by people in the community and the plant. Yes, they were working there, but at the same time they thought things were not really being done right. They asked me to ask the questions: Was it checked, did it go through quality control, where did it end up? Because it would hurt everybody down the road. I am glad that they did raise the question, so I said I would raise it tonight with you. It is something that should be checked out.

In other words, without repeating myself, if we are going to operate a sealing industry let's doing it right. If it is in small quantities in the beginning, as long as we do it right, that's better, instead of for the fast buck and sent out in bulk samples and not have it done right.

Plants in the Province with operators is something I will mention as a concern. I do not really know what the answer to it is but it certainly is a concern. You see it happen in St. Anthony, it is happening in my district today. I have had calls again as late as today from Little Bay Islands and La Scie. Here they are with plants and you have an operator coming in and out taking out a piece of equipment one night, putting in another piece another night, telling them he is going to bring shrimp another night. People are just up and down. Yes, there is going to be shrimp here this year, there is not going to be crab, and they do not know if they are coming or going, and they can't get an answer from the operators.

I do not know how far the minister's department can go with that but certainly it is a concern and maybe you could look at some way of addressing that. The same thing is happening in St. Anthony as you know. I just raise it as a concern as something that should be addressed, basically so that the people can get on with their lives. I have had people from Little Bay Islands calling me and saying: For God's sake, if he is not going to open, just tell me so I can move, or so I can get on with something. They just do not know what is happening and now they are living by rumours and speculation. It is a concern. I have just mentioned three places but I am sure there are many more.

I will start with a first question on the aquaculture industry, I guess, and it is more of a general one before I do some specific ones. You mentioned the Capital Loan Program. You said within two to three weeks that should be in effect.

MR. EFFORD: It should be in effect.

MR. SHELLEY: That is just for people who are already established. Is that right? It is not for new ones (inaudible) -

MR. EFFORD: (Inaudible) a freeze is on.

MR. SHELLEY: It is basically for expanding or developing, okay. Within a couple of weeks people can apply to that?

MR. EFFORD: Yes.

MR. SHELLEY: Last year there was a problem too with the dried squid, as you know. We addressed it then and you were cooperative in helping me and the people in my district, and probably in other districts, where people had put a lot of work into going out and getting dried squid. It is almost like running a race and getting to the finish line and not getting over. I know the man, he phoned me and said: I needed two more stamps. It is a bad way to look at it but that is the reality in some parts of the Province. They would have got it with a bit of dried squid they had.

They were told they were going to be able to sell this, and of course got to that point where they wanted to sell it and they couldn't. There they were, stuck with a shed full of dried squid. They did all the work to go get it, used their gas to do it, thought they were going to get over the line with it and never got there. I think last year, Minister, you mentioned some things that maybe this year we should know beforehand so at least they know if they can sell it or not.

Those are the general ones and a few comments, and I will just go on to three or four specifics that we have here. Then I will let Roger go, as I am sure he has a few questions. I will ask a few more later. Specifically, in 1.1.01, Minister's Office, with respect to Salaries, there was an over-budget of $25,400. Was that a new position? What was the extra $25,400 for in .01 under Salaries?

CHAIR: If I could, before the officials answer questions perhaps they should identify themselves for the purposes of Hansard.

MR. EFFORD: We have a temporary position within my department. I have three staff in my department and one of the positions is temporary, and that would cause the overrun there.

MR. SHELLEY: That is a temporary position (inaudible). Okay. Under .03, Transportation and Communications, there was a $36,100 discrepancy in the revised figure. Can you tell me what the discrepancy is for?

MR. EFFORD: I guess that is a reflection of the travel that I have been doing over the last number of months. I had to go to the Asian countries in November. Then I saw it necessary, because of the lack of quality control measures that were put in place or were in place here in the Province. If you are going to implement quality control measures you can't just walk aboard a boat or walk into a room and tell people what to do. Seeing is believing. We took a group of fishermen over in Japan in February to expose them to the world markets, what the markets were looking for, and as they said when they came back: I never ever thought that this was going on the world, and now I know what I have to do to be competitive.

The travel that we did last year in those countries, where we depend on those countries to buy the $575 million worth of product to stay competitive, the travel budget overran last year because of the necessity to do that type of travel.

MR. SHELLEY: Did some people (inaudible), you said exposed to the markets. That is local people then?

MR. EFFORD: We took seventeen processors and fishermen in January to Japan and to Alaska. We have not been doing very well. In fact, in 1995 Japan bought 17,000 tonnes of crab from us; in 1997 they bought 5,000 tonnes because of the bad quality. We have now turned that around and increased our presence in the Japanese and the American market because of our quality control measures. That was certainly conveyed to us in the most recent show down in the Boston seafood in March.

MR. SHELLEY: There was $96,800 spent under this heading. Was that for all travel?

MR. EFFORD: That was all for travel, yes.

MR. SHELLEY: Under 1.2.01.01, Executive Support, according to the 1997-1998 revised figure the department is over budget by $116,300. Why was it over?

MR. DEAN: Mr. Chair, last year we reorganized the executive of the department and we brought on two additional executive staff, gave up an ADM position, but replaced these with two executive directors. In the main it is the result of an increase -

MR. SHELLEY: That is two executive directors instead of the ADM.

MR. EFFORD: Yes. When I came into the department in 1996 we had three ADMs, a DM and myself, a minister, that was all. We now have one ADM, the deputy minister, and Mr. Pinhorn and Mr. Lewis as executive officers.

MR. SHELLEY: In 1.3.01, Administration, there was money for financial, human resources and information technology. There was none under those headings.

MR. EFFORD: We are saving money.

MR. SHELLEY: Yes, so what is going on with those? Where is that being transferred?

MR. EFFORD: What do you mean, "transferred"?

MR. SHELLEY: Where is it now? There was money for that, right? Under the Estimates in 1.3.01, Administration, there was $598,400 appropriated under that heading.

MR. EFFORD: Yes.

MR. SHELLEY: They were there, they say, for financial, human resources, and information technology of the department.

MR. EFFORD: And?

MR. SHELLEY: There was nothing on that. I mean -

MR. EFFORD: We did not spend it.

MR. SHELLEY: You did not spend it.

MR. EFFORD: We are good (inaudible) transfer the...

WITNESS: (Inaudible) into one department.

MR. EFFORD: That is what I am saying, we transferred it over. It used to be it was three departments, and now we integrated that responsibility into one department.

MR. SHELLEY: That is what I am asking.

MR. EFFORD: I am saying we are being very efficient saving money. We are not wasting the taxpayers money.

MR. SHELLEY: I know what you are saying. I imagine you are aware of this. That is it, that was the answer then. There you go.

Under Administration still, under Salaries, you were over budget by $143,600. Were there new positions there? How many new positions were created there? Is that one salary or what?

MR. EFFORD: That is my salary.

MR. SHELLEY: Is that Frank's?

WITNESS: What subhead Paul, what is the heading?

MR. SHELLEY: 1.3.01.01. Was that one salary, was it a bunch of salaries, or did you give Frank a raise? If you gave Frank a raise it is all right. If you gave it to Frank it's okay.

MR. EFFORD: When we reorganized the department it took some reorganization at that executive level, and then we had to transfer some of the financial people. Instead of having its financial administration and human resources administration for three departments, we put it under one department, and then where we transferred other people into fill some of the vacant position that were there that is where that came in. Like I said, the budget of Fisheries and Aquaculture has gone down from $30 million to - our total budget of administration is less than $8 million, is it?

WITNESS: Eighteen million dollars in total.

MR. EFFORD: Eighteen million dollars in total, but that is the total expenditure of the department for research and development, fisheries and issuance.

MR. SHELLEY: As far as the total budget goes you should have more.

MR. EFFORD: When the Tories were there they spent $30 million, we only spend $18 million.

MR. SHELLEY: See, they are smarter, they spend more money. There should be more money in that part of it, especially with the advancement in technology. There should more (inaudible).

MR. EFFORD: We need less money. We work harder. We did come in under budget under Salaries, by the way, last year.

MR. SHELLEY: Did you?

MR. EFFORD: Overall in the department.

MR. SHELLEY: In Revenue - Provincial, in .02 under Administration it was $10,000. What is the source of the $10,000 provincial revenue? Did they just donate that? That is .02, under Revenue- Provincial, under Administration. What is it?

MR. EFFORD: Those are fees for the aquaculture industry.

MR. SHELLEY: Oh, that is what it is.

MR. EFFORD: Yes.

MR. SHELLEY: I thought it was contributions or something for you.

MR. EFFORD: Why didn't you ask me about the contributions?

MR. SHELLEY: I will leave it at Grants and Subsidies (inaudible) a few questions. I have to look over a couple of these. That is enough for me, Mr. Chairman, for a little while.

CHAIR: Thank you, Mr. Shelley. Perhaps Mr. Barrett might want to ask a couple of questions.

MR. BARRETT: No. I just wanted to say that I think the minister and the whole department (inaudible) excellent job, and keep up the good work. All the (inaudible) committees and everybody else (inaudible) Fisheries and Aquaculture. I don't see anything wrong with the Estimates whatsoever. The Member for Baie Verte pointed out some little details but (inaudible) around here.

I was looking for the (inaudible) in Grants and Subsidies and what does that include? Does that include (inaudible)? Everybody likes him, so I will go on to whoever the next questioner is.

CHAIR: Thank you, Mr. Barrett. Mr. Fitzgerald.

MR. FITZGERALD: Thank you, Mr. Chairman. If the lights did not go out when the Member for Bellevue was speaking I have a feeling we are going to stay on until 10:00 p.m. They shouldn't go out any more.

Minister, I would like to make a few comments first. I would like to just talk about the sealing industry in my district and tell the people gathered at this meeting what it means down there. We had a company move in there that bought a plant that was lying idle, and even before the moratorium I think only employed ten to twelve people in the last two or three years building up to 1992. This company moved in there, they expanded on a wharf, invested in excess of $2 million. One hundred and forty people were working there at peak period during the seal hunt, and if you went there and saw the activity that was happening there for those two or three weeks it would make you want to hang around.

It would make you want to hang around in a community that, prior to now, I would almost drive through and be afraid to stop in, that I would almost drive through and be afraid to wear a smile when I got out of the car, because somebody would look at me and say: Boy, what are you smiling about? We have nothing to smile about. To go there and just to park outside that plant and see what is happening there is different. It's been changed by, I suppose, a fish or a mammal that up until now was taken, and as far as we know we saw a boat tie up at the wharf, a few flippers were sold, the pelts were taken to Carino Ltd., and that was all we ever saw of it.

They are down there now producing pelts. I went into the office and there were about fifteen people standing outside the door trying to get a job, and there were about twenty-five pelts that were processed and put on a chair. I went in, looked at them, sized it up and asked: Can I have one of those to take with me to take into the House of Assembly and show the people there what is happening right here in Catalina? The manager, Mr. Sullivan, said: No, you cannot have one because we would like to take it a step further. This is trial and error. We are only beginning this and there are some imperfections there. Come back in a couple of weeks' time and then take one and do whatever you want to do with it.

Those pelts are right ready to be sewn into a garment. I thought it was a situation where they were going to be taken to a certain stage, they would be shipped out somewhere else, and then they would come back made into clothes but we would never see the finished result. That is not the case.

MR. EFFORD: First time in the history of the Province.

MR. FITZGERALD: That is not the case. You are 100 per cent right.

MR. EFFORD: They are some lucky they elected a Liberal government.

MR. FITZGERALD: They are lucky they have a PC member there, I would say to the hon. minister.

MR. BARRETT: It is a good thing we had the Liberal from Dildo to go down and show them how to do it.

MR. FITZGERALD: If that is what is happening then that is great, but this is what is happening in this particular plant. You move up the road a little ways and you come to a giant FPI plant whose parking lot, up until now, since I have been involved in the district, was only used for demonstrations, where people would gather on a Sunday afternoon and try to bring light to a situation, where we would try to get somebody to look at what was happening here and with the desire to go to work.

MR. EFFORD: What can I say? We are doing things right. (Inaudible).

MR. FITZGERALD: I am not blowing your horn, but -

MR. EFFORD: Yes, you are.

MR. FITZGERALD: - I am telling you what is happening right now in my district. There are positive things happening, and that is the only way that those people are going to survive. If we are going to go and try to get people to come in to Catalina, Port Union and Bonavista making cars or making engines or making anything beyond the fishing industry, I believe we will never employ the numbers even close to where we were before.

That is not saying something else cannot happen there, because there are already things happening in other places that are outside the fishery, but I can tell you that we might just as well concentrate on having the fishery being the major employer in those areas. I don't think anything else could even come close to it.

Then I move up the road to a place called Charleston where there is a fish plant, a place that employed 280 to 300 people. Granted, it was a seasonal plant, but it is a new plant, owned by Nickerson's at one time, inherited by FPI during the restructuring. That plant is capable of working year-round if they had the material to process. FPI decided to turn that particular plant over to an action committee that then decided to enter into an agreement with a Mr. David Lee, now known as Petlee Fisheries. I fear that this is going to be a plant that will never operate as long as this individual is involved in the operation. I don't have any faith in the gentleman or in what he is trying to do there. It is a situation where I think people are being led astray, led down the garden path, and being made to believe that there is going to be an opportunity there for them.

MR. EFFORD: He cannot be a supporter of yours.

MR. FITZGERALD: I don't know who he is a supporter of, I don't even know the fellow. I met him at one time. Because they thought it was the right thing to do, and I did not know any better other than to tell them to make sure that you check out the fellow and find out what he has done in the past - because I know a few things about him and here is what I know -, but if you people decide that he is the fellow that should go there and operate the plant, then I will support you if that is what you want to do. Because I know of his history down in Freshwater, I knew of his history down in St. Albans, Bay d'Espoir, and I knew of his history in Prince Edward Island. Down there today they cannot even afford to put oil - I don't even know if there is any heat on in the plant down there.

I guess my question, Minister, to you is: What is going to happen to those places that are designated as core plants that have not done anything? Are you going to allow them to maintain their licenses? I know you are not going to step in - that is not your place -, but are you going to allow them to maintain their licenses forever and a day or will they eventually lose them and go to some other community?

MR. EFFORD: As long as the owner and operator pays his fee, maintains his operation, renews his licence, we or any government would have no right to go out and remove that licence from that owner/operator. If they have invested x number of dollars in the plant, that is their business. Some people can make it a success, some cannot. I think that time will be a factor in determining how long they will be there. If they are losing money, as you are referring to, or not making a go of the industry, how long can they stay themselves? As far as the government removing, or saying: You cannot operate that plant, they (inaudible) -

MR. FITZGERALD: So the license can stay.

MR. EFFORD: The license can stay there.

MR. FITZGERALD: How about if they come looking for new licences?

MR. EFFORD: If they are a core facility they have all the licenses, except crab.

MR. FITZGERALD: So they can come, and it is only a matter of them applying to get a shrimp licence and (inaudible) -

MR. EFFORD: If they have a core (inaudible). They know. If they have a core licence they have a shrimp licence.

MR. FITZGERALD: It is automatic.

MR. EFFORD: It is automatic.

MR. FITZGERALD: Okay. How many marine centres does government control or own now?

MR. EFFORD: There are twenty-five marine centres on the Island and in Labrador. We have a policy now where we are leasing and privatizing all of those centres, all except one. Is one not leased today? All the centres are now becoming private enterprises in the communities where they exist.

MR. FITZGERALD: Do they go up on tender or does the present operator have an option?

MR. EFFORD: It is a part of the original lease agreement that first call goes to the operator. When you call a proposal, if Mr. Smith comes in with a $10 proposal and the present leaser can match that, he has the first option on that centre.

WITNESS: (Inaudible).

MR. EFFORD: Exactly, because they have been there for a number of years, they have built up a business, they have all their equipment and everything in there, so they would have first right of their choosing.

MR. FITZGERALD: The price on those facilities, will they be doing an estimate of what the values are, and that is the way they will be sold?

MR. EFFORD: It is all done.

MR. FITZGERALD: It is all done. The appraisal value is there and the people are expected to meet them? Because it seems a little bit unfair -

MR. EFFORD: (Inaudible) there is a negotiating process in place that works out a reasonable price that we feel it can operate. There is not much point of charging an exorbitant amount of money for a structure that is not of value unless somebody is in there operating. If you charge too much money then they cannot service the fishermen because of their overhead costs. There is a reasonable negotiating period understanding the cost of operation and the cost to the individuals who will need the service, keeping in mind that when government owned those centres each and every one of them lost money every single year.

MR. SHELLEY: Yes. So is part of your consideration also that the people who go there employ people? Obviously, right?

MR. EFFORD: Yes.

MR. SHELLEY: It has to be. We are not just talking about the appraisal value.

MR. EFFORD: Not only employ people but as Frank points out, reinvest and expand, (inaudible) thing. In Harbour Grace there is a major fibreglassing operation that has been going on down there for the last three or four years now, employing as many as twenty-five or thirty people all winter long, where there was never an individual employed except the manager or the operator of that particular centre.

MR. FITZGERALD: Bonavista is a similar centre, where you have a fellow there now who is -

MR. EFFORD: A prime example.

MR. FITZGERALD: - manufacturing shrimp equipment.

MR. EFFORD: Drums and winches.

MR. FITZGERALD: He has entered into an agreement there with another boat builder -

MR. EFFORD: Another smart move by the Liberal government.

MR. FITZGERALD: Well, look where it is happening. He has entered into an agreement or a partnership with another gentleman there who is building boats or repairing boats. It is not uncommon to go in there and see a fifty-five foot and a sixty-foot long-liner cut right in two, and adding the middle section to it. There is a lot of activity going on there. The only fear that this gentleman had, in talking to him, was that the price that he was going to be expected to pay would probably put him out of business.

MR. EFFORD: He is dancing on a leaf, as happy as the birds.

MR. FITZGERALD: So it is all looked after.

MR. EFFORD: He is a happy man.

MR. FITZGERALD: He must have been dealing with Leslie Dean, the Deputy Minister.

MR. EFFORD: He knows that somebody is listening to him, somebody who understands business, somebody who does not want to waste the taxpayers' money, and somebody who understands that he has to provide a service. He is happy.

MR. FITZGERALD: It has been a couple of weeks since I spoke with him. That was his concern then. They are doing well there. The other part of it, Minister, is this. Down in St. Alban's, with the health and research facility that was supposed to be built there, what is happening with that?

MR. EFFORD: The engineering work is being done on that facility. It is going to be built in Bay d'Espoir but it is not going to be a magnificent centre just for the sake of putting it there. The centre that will be put there will be the basic centre to address the needs of the Bay d'Espoir aquaculture industry.

MR. FITZGERALD: So you are saying it is being reduced in size from what the original plan had been to build.

MR. EFFORD: It is going to be suited to the needs of the region and the engineering firm is now doing that, working with the people in St. Alban's. We are not dictating to them. We are working with the people and addressing their needs.

MR. FITZGERALD: Is there any truth to the concern that was raised that the government was going to be building this facility, then pass it over to the Salmonid Association, and your government leasing back the building and space that it wants?

MR. EFFORD: No. We will be renting private sector offices down there. The facility will be owned and operated after a period of time by the aquaculture industry, by S.C.B. Fisheries Limited.

MR. FITZGERALD: By S.C.B. Fisheries Limited. Your department will be leasing back space from them? It is a federal matter, but if we are only going to talk about provincial matters we would not talk a lot about the fishery, I guess. That is the situation where enterprises, fishermen, are only allowed to increase their boats to a certain size. This is still something that is very real out there in the bays and the coves today. I have to agree with the fishermen - and I think that you would probably have to agree as well - that if somebody's enterprise can support a larger boat and that gentleman is willing to go and secure private funding in order to purchase that particular boat, and he feels he needs it for the safety of his crew and in order to land a good quality product, then why should the government be involved in dictating to him what size boat he is allowed to have, if he not looking for more quota or extra (inaudible)?

MR. EFFORD: I am on record, in at least six to eight letters to the previous Minister of Fisheries and Oceans, Admiral Mifflin, the present Minister of Fisheries and Oceans, the hon. David Anderson, as saying very clearly: We shouldn't interfere any more with a fisherman building a boat than we do interfere with a resident or somebody building a house, somebody building a hotel or a restaurant or whatever.

MR. FITZGERALD: A taxi driver or whatever.

MR. EFFORD: We set the quotas. It is up to an individual if they want to build the Titanic and go out and use 150 crab pot licence, that's their business. You know what the quotas are. The problem with DFO and Ottawa is that they think the size of the boat is tied to the capacity, and that is not sensible. We control the quotas. We say that 98 million pounds of shrimp or 98 million pounds of crab or 98 million pounds of cod can be fished, there are 3,000 or 5,000 fishermen, and here is your quota according to the structures being put in place. You make up your mind what size of boat you want. I am on record, I have said it publicly, I have written the ministers on that issue, but unfortunately DFO is consumed with the idea that if you increase the size of the boat the demand will be there to take more fish. That argument is going on everyday.

MR. FITZGERALD: Yes. It is strange that somebody has not listened, because those people are saying to me: We are willing to sign whatever we have to saying that we are not looking for extra quota, we are not looking for extra licences. All we want is to increase the size of the boat.

MR. EFFORD: I think the reality is that somebody 2,000 miles away is making decisions but does not understand the reality of what is happening.

MR. SHELLEY: I understand that.

MR. FITZGERALD: Continuing on with that, I do not think I have asked what your views are on the situation where area 3L this year is the only area in Newfoundland and Labrador, from what I can understand, where fishermen are not allowed to use the buddying-up system as it relates to catching their crab on permits.

Last year the way it worked, I think, was that small boat owners had to put a registered boat on their applications for a crab permit. In the beginning they were only allowed to use the boat they had registered on that particular permit. They brought in some silly regulation whereby they could tow the small boat that they had registered out with them in the big boat, and they had to take the crab from the big boat, take it over on a winch and put it in the small boat, and tow the small boat into the wharf and unload it. As silly as that sounds, that is what is happening. Apparently there was an enclosure in people's licences in which they were asked if they agreed to the buddying-up system.

In area 3L, something like 53 per cent of the applications were returned, and out of the 53 per cent 61 per cent or 62 per cent said they disagreed with the buddying-up system. If you break that down, that is about 30 per cent or 35 per cent of the total license holders. Because of that DFO has come out and said that there will be no buddying-up system in area 3L. Minister, what that means in some areas is where you have enterprises where two and three people own shares in a larger boat, they owe money to the Fisheries Loan Board, now those two other fellows are saying: If we are not allowed to use our boat to fish crab, why should we be paying our share on that boat we are not allowed to use? To hell with it.

MR. EFFORD: There are two issues here. First of all, there is too much micro-management by DFO. The second thing - and I am on record saying this - is sometimes you can do too much consultation. So you have the micro-management versus consultation. You go out and you consult with the fishermen. As you have said, you get 61 per cent of the particular fishermen who have voted against that. If you look at the overall percentage of the number of fishermen who are involved then the percentage is much lower. DFO made its decision based on the majority of people who voted on that.

Let's go to the next step. We are all saying today there are too many people in the fishing industry. I think and I believe that once this post-TAGS program comes down and we implement a very rigid buy-out program, and I will say this here this evening, I would hope that when that program is implemented that it will be to the people who are least productive and not the productive people of the fishing industry. I think, once all that is unfolded, if you get 1,000 or 1,200 or 2,000 enterprises bought out of the industry, I do not think we are going to have that problem in the future of the need to buddy-up. Because the problem is these smaller boats that want to buddy-up with other boats, really, they are not capable of earning a living from the ocean if they have to go to that type of system. I think over the next year or two years, however long it takes this all to unfold, I think that will iron itself out.

The problem today is, it might be too much micro-management by DFO. By cripes, you can't move in this micro-management, and then in the consultation process that takes place you do not really - there is too much consultation, I think. You do not really get a true picture of the concerns of different regions or different sectors of the industry.

To try to make a decision or a platform to make the industry work the way you would like to see it work, with all the different factors, with all the different interest groups, it is almost an impossibility, and it is because you do not have enough resource, and too many people for the amount of resource that is available. Let's hope and cross our fingers that at the end of this post-TAGS program and the buy-out program that comes into place, instead of having 4,000 crab fishermen going after that crab you will have substantially less. Those people will be harvesting that resource, using crab for example, and will be able to use a boat because there will be sufficient quotas there to allow to them go in for that size of a boat.

I agree with you, there is a lot of problems there, but boy, we have caused a lot of our own problems in the industry by expanding and not being capable of earning a living.

MR. FITZGERALD: One think that maybe we might look at - and maybe you might have different views on it - is providing an allocation to an enterprise rather than to an individual fisherman.

MR. EFFORD: Wait now, explain that again.

MR. FITZGERALD: Providing an allocation to an enterprise rather than to an individual fisherman.

MR. EFFORD: Yes, those are enterprise allocations. We already have that in the case of -

MR. FITZGERALD: No, not for permits.

MR. EFFORD: Oh, not for permits. No. I would hope, as I said, at the end of the day that in the case of the permits that those small boats, a lot of those we get out of, and you will have a bigger quota. Then the EAs will be able to come into effect. Right now these permits are drawn every year. Now what is it, 6,000 or 7,000 thousand pounds?

MR. FITZGERALD: Last year it was 5,300 pounds in (inaudible) 3L.

MR. EFFORD: Fifty-three hundred pounds. They are renewed every year.

MR. FITZGERALD: Yes. That might be one way of looking at it. You know what has happened in the past, where fishermen sold their catch in one person's name. You have one person now who is designated as core and his other two partners who are not core. So if he gets one 5,300 pound quota his other two buddies get nothing. Where you have people who were fortunate enough to sell in the three names, those three crew members get 5,300 pounds even.

MR. EFFORD: Whatever the name of the enterprise or the vessel is, that is where the (inaudible).

MR. FITZGERALD: Yes. You can do it that way by enterprise allocation and all you do is give a bigger allocation.

MR. EFFORD: In the present system, with the present number of fishermen who are in there, that is almost an impossibility because how will you divide up the quota? Once the reduction is made in the harvesting capacity I think all of that will work itself out.

MR. FITZGERALD: Probably.

MR. EFFORD: If we can kick some life into DFO and beat some sense into them, and tell them to stop micro-managing the industry, set the quotas, set the enterprise or the individual quotas, and let them go at it, things will be better. There was a case in Port de Grave last year where a fellow had a sixty-five footer, he had engine trouble right up in November month, and he had 35,000 pounds of crab left outside the 200-mile limit. He wanted to lease George Petten's boat, who had the pots and all on the boat, and they would not let him lease. They left $35,000 worth of crab in the water. It is micro-management, it is stupidity.

MR. SHELLEY: Stupidity is right.

MR. EFFORD: What was the gain or what was the logic and the common sense used in that?

MR. FITZGERALD: No, it is crazy. You talked about the mussel industry in this Province. Do you have an idea what the mussel industry is worth?

MR. EFFORD: Yes. We had about 1 million pounds last year of mussels harvested. It depends on the market value. Sometimes it is around $0.45 or $0.50 a pound. We expect that harvesting three years down the road should be up to around $25 million. We are much below where we should be, and it is because there was no access to capital funding to increase their harvest.

MR. FITZGERALD: Are we exporting mussels?

MR. EFFORD: We are this year. In fact, the increase in 1998 is going to be substantially more than that. Probably you have the exact figures there, have you, Les?

MR. DEAN: Mr. Chair, last year there was about 750 tons of mussels produced in the Province. Ninety per cent of that would have been exported. Over the next two years, because of the amount of gear that is in the water, we could easily see probably that volume increasing to upwards of probably 4,000 tons, easily. The industry has come together. Most of the more productive players in the industry have come together under one marketing umbrella. We think, and we are fairly confident, that over the next two to three years we are going to see a dramatic increase in the mussel production in this Province.

MR. FITZGERALD: How many foreign boats are fishing today, Minister, out on the (inaudible)?

MR. EFFORD: The Nose and Tail?

MR. FITZGERALD: Yes.

MR. EFFORD: It depends. Right now today, this week, there are approximately ten to twelve vessels. That could go anywhere from that number to peak at any given time. Including the Flemish Cap, about twenty-six to twenty-seven vessels.

MR. FITZGERALD: So that is fishing shrimp on the Flemish Cap?

MR. EFFORD: No. I am talking about fishing turbot and Greenland halibut.

MR. FITZGERALD: How many do we have fishing shrimp?

MR. EFFORD: Eighteen at one point, and that fluctuates.

MR. FITZGERALD: So there are eighteen fishing shrimp and there are how many fishing -

MR. EFFORD: My concern is the Nose and Tail. The Flemish Cap is something that Canada is not involved in. We do not fish out there. My position on the Nose and Tail is extend jurisdiction and take in the spawning grounds, that part of the Continental Shelf, so we have total control of it. Until we do that it is international waters and there is nothing that can be done about it.

MR. FITZGERALD: Something has to be done.

MR. EFFORD: Something has to be done, yes.

MR. FITZGERALD: Boy, it is heartbreaking to go out there. I have made four trips out there myself, and to see those rusty tubs out there just scraping the bottom... They are not there for enjoyment, I can guarantee you that.

MR. EFFORD: While there are improvements being made, and there are observers on board of each boat, as you and I know until the spawning grounds are controlled the problem is going to get worse. There is nobody going to argue that one.

MR. FITZGERALD: Do you have any idea when we are going to see a price set for lump fish?

MR. EFFORD: Negotiations are ongoing now, but with the markets last year, and there is still 23,000 barrels of lump roe presently in storage from last year, I don't have a lot of confidence in what is going to happen to the lump roe market this year.

AN HON. MEMBER: It is not going to be there.

MR. EFFORD: No. Negotiations are ongoing, but you know the market determines the prices and (inaudible). You can sit down and negotiate, but with that amount in storage, and then to start harvesting more? If I were to recommend something to the fishermen of this Province, it is that I would not take one lump out of the water this year. The more you take out, the more the markets are going to be oversupplied and the less the price is going to be. I have a real concern about the amount of harvesting we are doing with lump anyhow. You are taking the lump out of the water, and all you are taking is the spawn out of them and you dump them (inaudible).

MR. FITZGERALD: Your views have not changed on the by-catch of seals in lump nets?

MR. EFFORD: No, sir.

MR. FITZGERALD: In the meantime, what do the fishermen do? I know your views on it but that does not help when somebody goes -

MR. EFFORD: There is no market there, is there?

MR. FITZGERALD: There are no markets there for it, but if they can sell it - I should not say there are no markets there for it, I don't know. If they can sell it, there is no point in you, Minister, saying: I know what you should do with them, you should carry them down and sell them. I agree with you, but when the fishery officer knocks on their door or stops their truck, they cannot take a chance on losing their truck and losing everything in it.

MR. EFFORD: I have some heavy discussions on that tomorrow. Not only the lump fish by-catch, but they closed down the personal use tonight.

MR. SHELLEY: Tonight?

MR. EFFORD: I am going to have some heavy discussions on tomorrow. I may be in jail tomorrow night.

MR. SHELLEY: I might go down with you. (Inaudible) out in my area, I will tell you that.

MR. FITZGERALD: What is happening in Black Tickle? You were going to Black Tickle. I don't know if you have been down there. What is happening with that particular plant down there?

MR. EFFORD: In fact, we could not get down because of the weather, but we had a tele-conference this morning with the people in Black Tickle, the local MHA and the local MP. There is a private company, H. B. Dawe Limited out in Cupids, that owns the facility in Black Tickle and the one in Domino. They bought it, they own it, so we cannot tell them what to do. We are trying to work with them and get them in there, on a small scale, into the shrimp fishery, because there is a shrimp quota adjacent to Black Tickle which can be harvested by the inshore Newfoundland and Labrador boats. We hope, over the next couple of weeks, that we will be able to get that operational in Black Tickle.

One thing I wanted to caution the people of Black Tickle about: Don't get your hopes too high, and start off small. If you can get that plant up and running and create twenty-five or thirty jobs doing shrimp, and a few jobs doing some other things down there like sea urchins, turbot or rock cod, start off small and let's see what happens.

MR. FITZGERALD: It was always a good area for turbot. I remember going to Black Tickle and they used to have pin boards on the wharves. The wharf was right full of turbot. Is the processing equipment still there?

MR. EFFORD: Yes. The one concern that I have about any fish plant on the Island portion of the Province is this: We have a very strict policy, no financing whatsoever. If you going to go into a community and you are going to operate a plant, it has to make money, otherwise it is only a social program. We are trying to do that. I know it is more difficult in Labrador. We are a little bit flexible in Labrador but still, if an owner and operator is going to go in there you cannot go in there building false expectations and giving people false hopes, and then come back to the federal and provincial governments looking for monies to support their incomes.

We have to be realistic and honest with the people, with the operator. Whatever resources there are available make sure you do not over invest and make sure you do not build up false expectations in telling people you are going to create one hundred jobs. If you can start right off with ten, fifteen or twenty jobs, (inaudible) to be honest with the people, and then it grows from that, work from there. You are not going to get propped up with taxpayers' dollars just because people think that you must be there.

MR. FITZGERALD: Last year the government leased the Nain Banker to which group (inaudible)?

MR. EFFORD: Torngat Fisheries.

MR. FITZGERALD: Torngat Fisheries. How did that work out?

MR. EFFORD: They returned it to us two or three months ago. As the Deputy Minister points out, that was not because the boat was viable. (Inaudible) operation was different views within that organization, too much conflict within the organization, so we have the boat back.

MR. FITZGERALD: So it did not work out is what you are saying.

MR. EFFORD: It worked out as far as the capabilities of the boat in harvesting the turbot and the crab. They didn't have it long enough. They had it less than a year, but within the organizational structure - Mr. St. Croix is not there any more, he is out in Fogo now. The co-operatives board there said: No, we don't want the boat. Now they have turbot and crab to catch and they don't have any boat.

MR. FITZGERALD: Do you have any idea how many inshore fishermen or how many enterprises will be taking part in the shrimp fishery this year?

MR. EFFORD: About 200.

MR. FITZGERALD: I was looking at your figures. You have been very conservative with your figures on the inshore shrimp.

MR. EFFORD: Conservative? Don't tell me I'm being conservative.

MR. SHELLEY: Progressive Conservative.

MR. FITZGERALD: I looked at the process here. In 1997 you have showing 404 processing jobs there. In 1998 the estimate is 684. I have a feeling it is going to be much more than that.

MR. EFFORD: It may be. We hope so.

MR. FITZGERALD: Well, if you look at what is happening in Clarenville and Port Union alone you can add another 140 or 190 jobs to that.

MR. EFFORD: The quota is not down yet.

MR. FITZGERALD: No, I am talking about jobs.

MR. EFFORD: I know, but the quota for shrimp is not down yet.

MR. FITZGERALD: Yes, I know, but the estimated jobs in Clarenville were ninety and I think the estimated jobs in Port Union were 150.

MR. EFFORD: When I was in business the one thing that I always made sure of, I always gave them minimum instead of the maximum because you always had room to expand. If you gave the maximum you had no where to go but down. We are conservative over those numbers. The conservative is not PC conservative, it is conservative in financial matters.

MR. FITZGERALD: Do you have any idea what the permit quota is going to be or the allocation for the (inaudible)?

MR. EFFORD: Yes, about a 20,000 tonne increase.

MR. FITZGERALD: So you do not know what it would mean for each permit. Last year it was 6,300. The estimation this year, from what I have been hearing, is 8,200.

MR. EFFORD: Pounds? No, no that -

MR. FITZGERALD: For crab.

MR. EFFORD: Oh, for crab, I'm sorry. I thought you were talking about shrimp.

MR. FITZGERALD: No.

MR. EFFORD: For crab there is going to be a small increase in the permits this year, not that much, probably a 10 per cent or 20 per cent increase in the permits.

MR. FITZGERALD: Over and above what they had last year?

MR. EFFORD: Yes, around 7,000, 10 per cent.

MR. FITZGERALD: Yes, they had sixty-three hundred last year. Okay, go ahead Anna, or Mr. Chairman.

CHAIR: Thank you, Mr. Fitzgerald. Ms Thistle.

MS THISTLE: Thank you, Mr. Chairman. Mr. Minister, two-and-a-half years into the portfolio your enthusiasm has not waned at all, has it? Not a bit.

MR. EFFORD: It's growing.

MS THISTLE: Growing. I remember at first when you took on this new portfolio you insisted and preached even, passionately, about the need for better quality, and you made mention of that tonight. I wonder now, what new things have you brought in to your department to improve quality? You mentioned the training course and the compliments you had received from the Japanese market and so on. Can you tell me about whatever new methods or whatever you have brought into your department to enhance quality? Have the markets been maintained in the Province for the existing markets that we had? Have we gotten new markets because of our enhanced quality, and if so, where are they?

MR. EFFORD: First of all, to start off with the quality measures, it was a new thing within the Department of Fisheries and Aquaculture. Because previous to my going in there as minister it was totally the responsibility of DFO, and DFO only had what they call a MQS program, Minimum Quality Standards. That was not sufficient to supply the markets. They never ever went into a boat, a fish plant or a truck to see what type of quality products were being harvested. As a result we really did damage to ourselves in the market.

What we had to do was we had to begin at home first. Within the Department of Fisheries and Aquaculture, we had to begin to start thinking quality. Frank Pinhorn and all the staff had to begin by saying: We are going to get into quality, so let's learn ourselves, let's get in tune with ourselves. Then we had some people out around the Province. As a result of the closure of the Marine Service Centre we had a lot of staff there, so we brought those staff to the Marine Institute last year, and again this year, and put them through a quality control program. Then the staff started developing a public relations and education program where they went around the Province and they met with groups of harvesters and processors and taught them about proper procedures. We took people to the market, because if you are going to tell people you must have a quality product you better let them know why you must have a quality product.

When they went to the Japanese market, when they went to the Boston Seafood Show and saw what every other country in the world was doing, they said: Oh my God. Because really, people in Newfoundland did not look at fish as a food. It is hard to believe after 500 years, and I will give you an example. In Placentia Bay a year ago, after five years of the cod fishery being closed down, we brought back an industry of 10,000 metric tonnes, and we treated it worse after five or six years of closure than we did pre-1992. I will back it up by saying there was a fisherman in Placentia Bay who went out and hauled the gill-nets. He took the fish in after four or five hours aboard of his boat, not gutted, no ice, and threw it off to the fish plant expecting the fish plant to buy it. The next day he went out aboard the boat as he wanted some for himself, for his own personal use, and he took each fish as they came out of the boat and gutted them, cleaned them, put them in (inaudible), and put ice on them. They were his own personal fish. The fish he brought into the plant he treated differently.

There has to be change in the thinking of the process. Public relations, talking about it, telling people: This is food. If you were to go into a supermarket and you were to buy a steak, and one steak was bright red, beautiful, the other one was dark coloured meat, what would you buy? I would buy the bright red. Why is there any different thinking with fish?

We have started an education process, we have started to get down aboard the boats, we have started to talk to people. Not forcing, not kicking people, not trying to intimidate them. We have been getting right down, consulting and talking about it. (Inaudible) probably explain and say: Would you eat that if that was for your table? No, I would not. Then why would you expect somebody else to? We went out and we are talking all species. We had to do the same thing with truck drivers, we had to do the same thing with processors, we had to do the same thing with the people on the wharves. We had to say simply this: This is a food. There is a world out there and you are trying to sell that product, you are trying to get the maximum dollar. If you are going to do it you had better do it this way, otherwise you are going to be out of the market.

I must say, it is working very well. In fact, Frank went around to seventeen public meetings this year and every meeting he went to there was a crowd of people in the hall, and what was the comment? It was: You should have done this before. It should have been done long ago.

MS THISTLE: So the education campaign is working. Are there any follow-up inspections on the wharf, in the plants -

MR. EFFORD: Yes, continuously.

MS THISTLE: - by your department, as well as DFO?

MR. EFFORD: Every day. No, DFO is not even in the picture.

MS THISTLE: They are not even in it.

WITNESS: National Sea in Arnold's Cove won't take it.

MR. EFFORD: P. Janes & Sons last year refused to buy cod out of 3PS. National Sea will not buy cod. Beothuck will not buy it. Now some companies will, and we are stopping those companies because sometimes with some Newfoundlanders you have to kick them a little to make them change, but we are there continuously. We are checking the backs of trucks, we are checking the temperature in the holds of boats, we are checking the temperature in the holding rooms of the fish plants.

At one time you would not process dead crab, but now we are saying crab that is critically weak is not to be processed. If it does not come in alive and fresh you are going to lose it. The fishermen realize it. If they bring in 25,000 pounds of crab and we take off 5,000 that are critically weak, that is $5,000 gone. Now they are putting ice aboard the boats and they are handling it right. They are not breaking the legs off because they are going to lose money. At one time if plant B did not buy it they would go up the road and sell it to plant C, but we have inspectors there saying: No, you are not buying it either.

MS THISTLE: Have you heard any feedback from fishermen that they have developed some new markets because of this?

MR. EFFORD: Not the fishermen, and I would not say that the plant owners developed new markets. What they are doing, the markets that they were selling to and putting the bad quality products in, since we started talking about this - we have done it worldwide, we have done it in the Asian countries and we have done it at the Boston Seafood Show - we put on these big banners, we put on a reception, and now the people recognize that there has been an improvement in the quality product and they are starting to come back to us. It is happening, not (inaudible) -

MS THISTLE: It has paid off.

MR. EFFORD: It is paying off. Not as much as we would like to see it yet, it is going to take a couple of years, but over the long term if we continue this, yes, it is going to pay off major dividends for the processors and for the harvesters.

MS THISTLE: That's a good move. Thank you.

MR. FITZGERALD: Minister, why won't they buy fish in 3PS? Because of the way it is handled?

MR. EFFORD: If you take 25,000 pounds of fish out of a cod trap, you don't gut it, you put it down in the hold of your boat - whether it is an open boat or whether it is a (inaudible) - and there is no ice or anything on it, the temperature is 27 degrees or 25 degrees, when it comes in it is like a piece of gel.

MR. FITZGERALD: Yes, but aren't those people now instructed and told that they cannot sell their fish if it is not treated properly?

MR. EFFORD: That is now being done.

MR. FITZGERALD: I have to go back to what you said. I was not laughing at you when you were talking, but when you talked about quality. I worked in a fish plant for thirteen years, and I remember first when I went to work there quality was not something that you heard everyday. This one fellow who worked on the cutting line there was the local barber, and every dinner break he would go out and the boys from the cutting line, if they wanted their hair cut, he would go out by the side of the plant and they would get their hair cut. Meanwhile, they all wear those big lumberjack shirts because it was not very warm, even though it was in the summertime, in the fish plant. After the hair had been cut, all I had ever seen done was the fellow like that has gone back on the cutting line. That happened day after day.

CHAIR: The Chair does have a weak stomach, Mr. Fitzgerald.

MR. EFFORD: I will tell you, since I became minister, on one of the trips that I went on, I had processors with me. Mr. Vardy was there, and Alastair O'Reilly was there from FANL, and they heard this man say: Send it over, the Japs will eat it. That was said last year.

MS THISTLE: A poor attitude.

MR. FITZGERALD: It was only in the last number of years that we ourselves -

MR. EFFORD: Attitude.

MS THISTLE: Attitude, yes.

MR. FITZGERALD: - will eat the fish in our own plants. That was our mind-set.

MR. EFFORD: It is turning around. I am very proud to say that the people in the Province, most of the harvesters and most of the processors, and the union, are very supportive. They say it should have been done, and now it is working very well. I am telling you, it is being recognized.

MS THISTLE: We are losing that look of pronging the fish over the side of the boat, finally.

MR. EFFORD: Handle it as if you are going to put it on your own table.

MS THISTLE: Yes.

CHAIR: Mr. Woodford. (Inaudible)?

MS THISTLE: Oh yes, I am finished. Thank you.

MR. EFFORD: I have another ten minutes and then I have to go to the airport.

MR. SHELLEY: I guess you are missing this flight, unless you tell us where you are going this time.

AN HON. MEMBER: It's going to Baie Verte.

MR. SHELLEY: Where are you going, Baie Verte?

MR. EFFORD: I am picking up my son, he is coming in from Edmonton.

MR. WOODFORD: Are you going on with me or are you going back to -

CHAIR: You are the last one to ask questions before we go back to other people who have already asked questions.

MR. SHELLEY: Yes, that's fine.

MR. WOODFORD: I just have a couple of short questions. I understand, Minister, that there is a shrimp quota allocated to P. Janes & Sons for Jackson's Arm.

MR. EFFORD: No.

MR. WOODFORD: No? No shrimp quotas?

MR. EFFORD: They just fish competitively.

MR. WOODFORD: Okay.

MR. EFFORD: They have their own boats (inaudible).

MR. WOODFORD: Yes, that's what I meant.

MR. EFFORD: Okay.

MR. WOODFORD: Yes, that's what I meant. Because they were going to use that old Nickerson's plant there to do it. What quota would that be? What kind of a quota would that be?

MR. EFFORD: That would depend on the boats. I think that P. Janes & Sons probably got around fifteen to twenty boats that they will be able to get their quota from. You are talking around 400,000 pounds in bulk, 350,000 to 400,000 pounds. It depends on the quota that is going to come down this year.

MR. WOODFORD: Yes.

MR. EFFORD: So you know, a couple of thousand tons that they can buy competitively off of these people, and it depends on how aggressive the company is and how (inaudible) they can attract more boats.

MR. PINHORN: They have twenty-five boats.

MR. EFFORD: Frank tells me they have twenty-five boats. So that's around -

MR. WOODFORD: They are fishing crab now.

MR. EFFORD: Yes. They have (inaudible) of probably 2,500 to 3,000 tonnes.

MR. FITZGERALD: Are they going to process shrimp in Jackson's Arm?

MR. WOODFORD: Yes, so that will be like I said before, probably 40,000, 50,000 or 60,000 (inaudible). I don't know, how many months a year?

MR. EFFORD: It depends. If they brine freeze it, store it and process it and how much they can buy, that could go up as much as fourteen or fifteen weeks on that amount, 3,000 tons. Easy, that much.

MR. FITZGERALD: FPI has estimated fifteen to sixteen weeks (inaudible) Port Union.

MR. WOODFORD: Fifteen or sixteen weeks.

MR. EFFORD: They will definitely get that, and that is minimum. Anything beyond that is...

MR. WOODFORD: Minimum, yes. It could be more. I was talking to a couple of people down my way in Bonne Bay, especially the Woody Point and Trout River side, and I think I heard you say before this year that the caplin should be good. What do we have, 45,000, 46,000 tonnes?

MR. EFFORD: There is a roll-over from last year which is 47,000 metric tonnes, but the quota is not the problem. The markets have been the problem. Over the last seven or eight years the caplin for some reason in Newfoundland, and I can get into a long discussion on that, has been a smaller caplin. Because it has been a smaller caplin we have been competitive with the Icelandic caplin fishery which is a comparable size. When we had the larger caplin we had that extra thing in the marketplace, but now this year past, when we were in Japan, I had extensive talks with people on caplin. The best caplin they got out of Iceland this year was 68-plus count, which is a very small caplin. That means that even if we get the caplin the same size as last year we will have a good caplin fishery this year.

MR. WOODFORD: At good prices.

MR. EFFORD: We had 68-plus. Or 45-50 or 50-55 this year will be good. That is (inaudible) the Japanese. The other problem is that we have not had a consistent caplin fishery. They can never depend on us so they always had to go to Iceland. What I have told them now is: You will be able to depend, as long as nature allows the caplin to come in, on the consistent year over year caplin fishery. We are trying to build a confidence in the market because we have not been consistent in our supply, and if you are not consistent in your supply then they have to go buy it somewhere else just in case we don't have it. We have been our own worse enemy.

MR. WOODFORD: Yes, there must be something on the go because out our way this year the Japanese are very aggressive -

MR. EFFORD: Yes, very aggressive.

MR. WOODFORD: - in trying to get the plant owners to sell them caplin.

MR. EFFORD: One thing that we have to do this year, we have to make sure that when that caplin comes in that we do not jump at it too quickly, that we look at it, we look at the size of the caplin, we take our time. The Japanese need it. Let's not get overanxious. Let's make sure we take the best possible caplin, with good quality, and we supply a good market product. If we can put a good quality caplin in that market this year, and we can make a buck and they can make a buck, they will come back next year. This is the year to build back confidence in the market.

MR. WOODFORD: A critical year for the caplin.

MR. EFFORD: A critical year for us.

MR. WOODFORD: Because they want it, but if they get a bad product they are not going to come back. If they get a good one they will be back for more. They are even offering to take other species this year that they would not take before, like herring and stuff like that, in order to get caplin from the plant. It is interesting.

What was the squid quality last year? You alluded to it earlier. Maybe Paul brought it up or something.

MR. EFFORD: The problem was not quality. Well, I suppose I should not say it was not quality. The problem last year was there was an oversupply of squid on the world market. Japan themselves last year exported squid, and the Falkland Islands and another areas. For some reason, nature again, there was a tremendous amount of squid on the market.

I have one over in the fridge, I wish I had brought it over tonight, it's over in my office. I picked up a pack of squid that I got at the Japanese market, and if you saw that squid packaged and how it was done compared to what we dry here, what we send over, it is like you going into a car lot and buying a Mercedes and I am buying a used Toyota.

MS THISTLE: Not a Toyota, a Chev.

MR. EFFORD: A used Chev, I am sorry about that.

MR. FITZGERALD: That is one area that I do not think we have paid enough interest in quality-wise.

MR. EFFORD: Exactly, quality.

MR. FITZGERALD: Because the buyers go out and they buy squid from the fishermen. They all pay the same price. The only time you have a cull is when it goes in the buyers shed.

MR. EFFORD: Exactly.

MR. FITZGERALD: There is no incentive there for fishermen to put up a good product.

MR. EFFORD: If I remember tomorrow I will bring it over to the House. It is something to see. There are two squid in a cello package, about that long, flattened out. The colour is perfect, it just entices you to buy it when you see it. Then you look at our squid that is dried on a picket fence or on the clothesline, and we expect to get the top price for it? We are our own worst enemy.

MR. WOODFORD: Yes, and there is so much potential and (inaudible).

MR. SHELLEY: (Inaudible) package it here right.

MR. EFFORD: That is what we are encouraging people to do more with the product. Why can't we, why can't we dry it right?

MR. FITZGERALD: In order to do that the incentive has to be there for the few extra dollars, or else the lower price on the other -

MR. EFFORD: It is there, the market will determine.

MR. FITZGERALD: Yes, but the fishermen are not getting it.

MR. EFFORD: If the fisherman puts up a better price and the supplier gets a better price, then the market (inaudible) a better price, then they will eventually. It is not going to happen over one year, but over three or four years.

MR. WOODFORD: It is going to have to be a combination, we will say, of the processor and the fisherperson.

MR. EFFORD: A combination of doing it right.

MR. WOODFORD: Yes, doing it right, because like you say, if they get the top price then they can afford to pay a few more dollars for a different product.

That is okay, Mr. Chairman.

CHAIR: Mr. Shelley.

MR. SHELLEY: I have to ask a couple of things about the seals again.

MR. EFFORD: What about the seals?

MR. SHELLEY: The mentality I saw with the TAGS, and I am sure you see it two-fold all the time with Ottawa and the way they think about it with TAGS, it is even going to be a tougher sell when it comes to an increased quota on the seals. We are definitely going to need an increased quota on seals. I think a key to it is going to be, of course, the markets. It is almost like with one hand you have to say now: Yes, you can increase your quota, but show me that you have a market. I suppose there is some kind of logic to that too. What is being done to develop the market?

MR. EFFORD: You will never ever increase the markets enough to take care of the overpopulated seal herd. The market development is continuing on a (inaudible) by the companies that are investing very heavily as you know in the sealing industry.

As I said in my opening remarks, we expect in five years or plus down the road to have a $100 million sealing industry if it continues to grow with the potential it has in the capsulization of oil and powder, and the meat, pelts and everything else. To take care of the seal problem we have today, you are going to have to have a major seal harvest, and a major seal harvest in our language means a major seal cull. You and I know that to take 3 million or 4 million animals out of the ocean to have a sustainable population out there of 2 million to 2.5 million, you never will increase the markets in the near future to have that type of an industry.

We have one thing. The markets are growing each and every year because of the investment and the work done by the private industry, and done by people like Frank Pinhorn who have been at this for the last ten or twelve years. That will increase. Hopefully next year it could be a 25,000 increase or whatever. We are looking into Italy for more markets for the skins, I should say. Hopefully that will grow, and yes, it will increase year after year, but the big problem is the overpopulated seal herd. We have to take control of that problem and get Ottawa to agree with it.

MR. SHELLEY: Yes. Basically what you are saying - really what I am trying to get at here tonight, because I have heard you talk about it, because I am feeling the same way - is we are never going to get to market what needs to be killed in seals.

MR. EFFORD: Exactly.

MR. SHELLEY: You know yourself, if we don't do something with those seal herds out there - I mean like real soon, within months -it is going to be devastating. There will not be anybody, I am telling you, anywhere to talk about what is left in the fishing industry, besides what could happen to the seal herds of course. Like you said before, with nature and so on.

MR. EFFORD: Nature will take over.

MR. SHELLEY: I don't know what your plans are, but something drastic is going to have to be done -

AN HON. MEMBER: Is there a birth control pill you can give them?

MR. SHELLEY: No, but seriously, something is going to have to be done -

MR. EFFORD: Wait a couple of weeks.

MR. SHELLEY: Something drastic is going to have to be done on that problem, and I am telling you it is going to have to be done real soon.

MR. BARRETT: We have seals in Placentia Bay, you know.

MR. SHELLEY: I am telling you, I can tell you stories about having to row with seals and everything.

MR. BARRETT: When I was growing up there was only one seal in Placentia Bay.

MR. SHELLEY: Gee, they are up there off the government wharf in Baie Verte. Nine miles (inaudible) with kids down looking at them on the ice and stuff like that. Anyway, I just want to address it once more.

I won't go into the other questions now then, but I am going to say this once more. Because you talked so much about quality I have to say it again that this timing of the seal industry is the most important to me. I think it is the most important because we have to do it right in the early stages. I will say it to you again - not just because of what happened at Fleur de Lys, but it should be checked out in other parts - that if we are sending out even market samples this year - for example, that is all the intentions are of the plant in Baie Verte, and it is fine with me. There are not a lot of jobs with it yet, but he is doing it slowly and quietly and he is doing it with quality. That is what they are more involved with this year, doing a quality product. If they can send over one litre that is purified, done properly, nice and clean, that is better than sending 10,000 tons of it over there in a big hurry and done wrong.

MR. EFFORD: That's right.

MR. SHELLEY: Because there are concerns over there. When I raise that concern again on behalf of what happened there - but not just for that area though, I say, Minister, it is for the whole area - to do it right in the beginning, you understand why.

The one last question I will ask you is on the transferring of plant licenses. I will not name specific plants, you probably know what I am talking about anyway. What is it going to follow, the criteria, before a license is transferred? (Inaudible).

MR. EFFORD: Simply if there is a request in for a transfer of a license to facilitate a core criteria there is an application made to the department by the person who needs that transfer of license. Then we will publicize that for two weeks, and then after that then we will approve, if there are no really strong objections, the transfer.

MR. SHELLEY: What if there are objections?

MR. EFFORD: It depends. If there is an existing plant there we would have to give it a lot of consideration if we saw some potential of that plant operating, but if no existing plant program -

MR. SHELLEY: No existing plants (inaudible)? I will leave it at that then.

CHAIR: Thank you, Mr. Shelley.

Mr. Fitzgerald.

MR. FITZGERALD: Just a couple of quick questions. Minister, is 4,000 metric tonnes enough quota this year in 2J-3KL as a test fishery to give us an indication of what fish is out there?

MR. EFFORD: All the 4,000 tonnes is going to do this year is cause complete hell, chaos. If you could not give the 15,000 tonnes because of the large number of fish, how do you divide 4,000 tonnes of fish up among how many thousand fishermen?

MR. FITZGERALD: So this year in 3PS it is 30,000 tonnes?

MR. EFFORD: Twenty thousand tonnes.

MR. FITZGERALD: From 10,000 tonnes to 20,000 tonnes. Have we learned any lessons from what happened in 3PS last year?

MR. EFFORD: I would surely hope so.

MR. FITZGERALD: That was ridiculous. You were minister. To go back -

MR. EFFORD: I couldn't believe it.

MR. FITZGERALD: - and have 10,000 metric tonnes allocated five years into a moratorium and have to dump fish?

MR. EFFORD: Did we ever learn anything? We have had public meetings with the fishermen. Everybody recognizes the mistake, the stupidity that happened last year. There are individual quotas being talked about now for those fishermen so they will not have to rush out there every day. They do not want to catch it early in the year in the hot temperature, they want to go later in the fall and catch it. There are really things happening.

I am not responsible for harvesting, but I have told the people that if they do not follow the procedure this year of good quality products I will close down every fish plant in the Province and they will not be able to sell one (inaudible) of fish.

MR. WOODFORD: Proper thing.

MR. EFFORD: So they have to do it right.

MS THISTLE: That is a good idea.

MR. FITZGERALD: Does your department do all inspections in fish plants (inaudible)?

MR. EFFORD: Yes.

WITNESS: (Inaudible) be for export?

MR. EFFORD: No, no, I am talking about the quality of fish coming in.

MR. FITZGERALD: Yes, but the only inspection that is done by DFO now, the feds, is for export.

MR. EFFORD: For the exports, yes. I am talking about harvesting.

MR. FITZGERALD: The Province does the inspection of the plant -

MR. EFFORD: And the boats.

MR. FITZGERALD: - and the boats -

MR. EFFORD: The trucks.

MR. FITZGERALD: Does DFO still do inspection of plants?

WITNESS: In a very small way.

MR. EFFORD: Minimum.

MR. FITZGERALD: So all they do is they test the product before it is shipped, before it is exported.

MR. EFFORD: Yes, that is all. That is the reason why we took it over. We forced our way and then we bulldozed our way in through the door. I do not have any confidence in the standards they have there. The markets told us. It is ridiculous. We had turbot shipped two years ago over to Taiwan and shipped back to us. DFO inspected it. We are taking over.

MR. FITZGERALD: What are you views on ITQs?

MR. EFFORD: I do not like them, never agree with them. They have too much control. IQs but not ITQs. ITQs mean one company could buy up everything in this Province. That is a monopoly. I do not like it.

MR. FITZGERALD: We can get into all kind of figures here but I am not going to ask them because I have no way of telling if you are telling me the truth or not, so there is no point in even asking them.

CHAIR: If there are no other questions, I want to express my appreciation for everybody participating so effectively at tonight's meeting.

I would ask for a motion and call the heads of 1.1.01 to 3.2.02 inclusive.

On motion, subheads 1.1.01 through 3.2.02, carried.

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

MR. EFFORD: Thank you, Mr. Chairman and Committee.

CHAIR: The next meeting is at 7:00 p.m. tomorrow at the House on the Department of Forest Resources and Agrifoods.