April 23, 1991                HOUSE OF ASSEMBLY PROCEEDINGS               Vol. XLI  No. 34

The House met at 2:00 p.m.

MR. SPEAKER: Order, please!

The hon. the Member for Torngat Mountains.

MR. WARREN: Thank you, very much, Mr. Speaker.

If you would allow me, Sir, today I would like to ask you, as the Speaker of this House, to send condolences to the family of the late Alder Ford. I know by the look on many hon. member's faces that there is probably nobody in this House, in this Legislature, other than my friend for Kilbride, who knew the late Alder Ford. Alder Ford, Mr. Speaker, was a pioneer. When the Government of Newfoundland and Labrador took over responsibility in 1951 for managing the retail outlets in northern Labrador, Alder Ford was the first native person to be on the Government payroll. During the past weekend Mr. Ford departed this life and I think, Mr. Speaker, you would have to have known Mr. Ford to really appreciate his contribution. In 1969 and 1970 I had the opportunity of having Mr. Ford as an employee of mine and his devotion to Government, his devotion to his work, and his devotion to his family and to his church, was exceptional beyond any expectation. He has been recognized by 'Them Day's'magazine in Labrador as a pioneer. I would suggest, Mr. Speaker, that you send condolences to his two sons and three daughters and their families, in appreciation of the work and life that Mr. Ford has given to the Province of Newfoundland and Labrador, and in particular to the community of Makkovik.

Thank you.

Statements by Ministers

MR. SPEAKER: The hon. the President of Treasury Board.

MR. BAKER: Mr. Speaker, it is my pleasure to inform Members of the House of Assembly that earlier today the Government of Newfoundland and Labrador, and the Government of Canada, signed a four year $7.1 million ACOA/Enterprise Network Cooperation Agreement. This Canada/Newfoundland agreement was signed this morning by the Hon. John Crosbie and the Minister of Development during a news conference.

The ACOA/Enterprise Network is among the most important economic development agreements ever signed by the Federal and Provincial Governments. It is an innovative, computerized information network to assist the development of small and medium sized enterprises in this Province. It represents a fundamentally new form of technical and human infrastructure for the long-term economic development of our Province.

Mr. Speaker, this network will encourage entrepreneurship by making business information equally accessible to individuals and organizations in urban, rural and remote regions of Newfoundland and Labrador.

The development of the information network system will include the creation of strategically sited electronic telecentres to provide communities with access to computing and communications facilities, business planning services, teleconferencing and distance education facilities, as well as consulting services.

Newfoundland and Labrador, Mr. Speaker, is already a national leader in telecommunications and is now the first province in Canada to create this type of network.

SOME HON. MEMBERS: Hear, hear!

MR. BAKER: Mr. Speaker, I would like to express appreciation to the Economic Recovery Commission for having the foresight -

SOME HON. MEMBERS: Hear, hear!

MR. BAKER: - to provide rich financing for the Enterprise Network during the past fiscal year. Without the support of the Economic Recovery Commission, this project would not have gone through the technical and market testing that it has in the last year, and we would have agreed today to supporting only a concept rather than a real system that is already functioning.

Mr. Speaker, we can all look forward to the important impact which the ACOA/Enterprise Network will have in supporting business and economic development throughout Newfoundland and Labrador.

SOME HON. MEMBERS: Hear, hear!

MR. DOYLE: Mr. Speaker.

MR. SPEAKER: The hon. the Member for Harbour Main.

MR. DOYLE: First of all, Mr. Speaker, let me offer a very sincere word of congratulations to Mr. Crosbie. Only in the portfolio approximately twenty-four hours, and has already given $5 million to the Province of Newfoundland and Labrador. That is performance, Mr. Speaker.

SOME HON. MEMBERS: Hear, hear!

MR. DOYLE: Let me also say that any initiatives taken by the Federal Government and by the Provincial Government to improve in any way the faltering, floundering efforts of the Economic Recovery Commission and Enterprise Newfoundland is certainly welcome news to members on this side of the House, Mr. Speaker. As the member says, it is a cost-shared initiative, 70 per cent of which is provided by the Federal Government, to the tune of approximately $5 million.

I think it is possibly a good move. I think it is a very good move by the Federal Government, especially when one considers that the Economic Recovery Commission, to date, have been trying to take the credit for most of the projects that have otherwise been approved by ACOA and other funding agencies, Mr. Speaker, and will undoubtedly go a long way in lending some credibility to the failed efforts of the Economic Recovery Commission and Enterprise Newfoundland who have now been in existence incidentally approximately two years, who will have spent by the end of the coming fiscal year approximately $6 million, and who to date can show approximately 65 jobs that have been created by the Economic Recovery Commission and Enterprise Newfoundland for about a $6 million bill which means that the Economic Recovery Commission has been costing the tax payers of Newfoundland and Labrador approximately $92,000 per part-time job, Mr. Speaker. It is ironic that the Premier, who has been criticizing ACOA over the last two year period in particular for not being responsive to the needs of Newfoundland and Labrador, is today the recipient of a huge windfall of money, $5 million that will go a long way, I guess -

MR. SPEAKER: Order please!

The hon. the Member's time is up.

MR. DOYLE: - in propping up the Economic Recovery Commission and lending some credibility to the failed efforts of that body.

SOME HON. MEMBERS: Hear, hear!

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

MR. DICKS: Thank you, Mr. Speaker. I would like to bring to the attention of my colleagues that April 22-28 is National Consumer Week.

This is a very important event, Mr. Speaker, as it emphasizes the importance of consumer awareness.

The Theme of the week is "Team Up For A Stronger Marketplace - Consumers, Business and Government." In keeping with the theme, a campaign has been mounted to encourage a partnership of all three parties to ensure an effective marketplace.

Mr. Speaker, I am pleased to announce that the Federal Department of Consumer and Corporate Affairs is working in conjunction with the Provincial Department to ensure the success of this campaign. Municipal governments are also participating by recognizing the importance of consumer education; and I wish to extend appreciation to my honourable colleagues, who are actively participating in the week's celebrations and to those departments which have provided assistance in our preparations for this National Consumer Week.

The Marketplace is changing, Mr. Speaker. These changes encompass new technology such as the use of debit cards, which will challenge consumers present spending habits; new methods of shopping as telemarketing becomes more widely accepted; and the demand for industry to be cognizant of environmental and health issues.

Consumers must be prepared to deal with these changes. In order to ensure the marketplace works for them, consumers have to be aware of the many concerns surrounding these issues.

National Consumer Week is an avenue for increased awareness of consumer issues, Mr. Speaker, and I invite my colleagues and the general public to join in our activities and to be aware of their rights and responsibilities in the marketplace. Thank you, Mr. Speaker.

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

MR. R. AYLWARD: Thank you, Mr. Speaker. First of all I want to thank the Minister for an advance copy of his statement and from the way he presented it I would say he only just saw the statement himself before he came to the House.

There certainly is a need for consumer awareness in this Province and throughout the nation. I would imagine that this is one of the responsibilities that our Premier would like to transfer to the Federal Government also. Because when we look at our Government's actions in consumer awareness, all we see is that this Government closed consumer office's in Grand Falls and Happy Valley-Goose Bay. We see last fall that the Ministers of Justice and Energy were talking about regulating gas prices and they have done nothing since that time except talk. That is all this Government wishes to do for consumer awareness, talk about it, and waste money on several ads that I heard this morning on one radio station in this time of restraint. As far as this Government is concerned this is hypocrisy personified.

Oral Questions

MR. SPEAKER: The hon. the Member for Port au Port.

MR. HODDER: A question for the Minister of Social Services. Did the Minister speak or write to the President of Treasury Board asking that the level of compensation be increased from Level I to Level II for the Social Assistance Appeals Board? And if there was written correspondence, would the Minister table that correspondence?

MR. SPEAKER: The hon. the Minister of Social Service.

MR. EFFORD: Probably the hon. Member for Port au Port was not in the House last week. First of all, I said yes I did speak to the President of Treasury Board. Secondly, the hon. Premier tabled a letter from my Deputy Minister to the President of Treasury Board making that very statement last week.

AN HON. MEMBER: No, that was before.

MR. EFFORD: Before...?

AN HON. MEMBER: (Inaudible).

MR. SPEAKER: Order, please!

The hon. the Member for Port au Port.

MR. HODDER: Thank you, Mr. Speaker. I would just like to get the Minister on the record. Mr. Speaker, another supplementary. On how many occasions did the Minister speak to the President of Treasury Board? And why was it he only pressured the President of Treasury Board on this one board? Why only on this one board despite the recommendations of his Department that the other four appeals boards were made Level I rather than Level II? What made this board so special?

MR. SPEAKER: The hon. the Minister of Social Services.

MR. EFFORD: Mr. Speaker, I thought we had all this solved. Now you can ask a question in a hundred different ways. The purpose and the reason why I appealed - I not only made representation but I also appealed as Minister of the Department - was because I consider the Social Assistance Appeals Board to be a board that is a very busy board; it takes a lot of time, and the expertise is needed on that particular board. In fact, I have not even had a conversation - I do not know if the Day Care and Homemakers' Board is put together yet. It has been enacted for some particular time, as well as the Rehabilitative Appeals Board. But I have not seen or talked to the appeals boards at any time in the past year.

MR. SPEAKER: A supplementary, the hon. the Member for Port au Port.

MR. HODDER: Mr. Speaker, is it not true that the Treasury Board guidelines for rates and remuneration for boards - and this was dated March 12, 1990 - the criteria for a Level II board states and I quote: that this Level would require an element of professional expertise? And further, is it not true that guidelines dated January 30, 1991 state and I quote: that at this Level legislation specifies the nature of the board, commission or agency be such that members require professional credentials and expertise? My question is, what professional credentials and/or expertise does Mr. Stoyles bring to his position as Chairman of the Social Assistance Appeals Board so as to justify this change of classification?

MR. SPEAKER: The hon. the Minister of Social Services.

MR. EFFORD: Mr. Speaker, the difference in me as Minister of Social Services is that I have tried to bring some credibility to the Department of Social Services not only on a public relations matter and on program delivery, but I have a great deal of respect for individuals across the Province of Newfoundland and Labrador who either apply or come to the Department of Social Services either for financial help or for counselling or whatever. Now those people, even though they are in financial trouble, deserve the same respect as any other individual in this Province. The people appointed to the Social Services Appeals Board were appointed not only because they knew John Efford - there was only one individual on this particular board who knew me - but a resumé was presented by these individuals, they graduated from Memorial University and they were experienced. But that was not enough, Mr. Speaker. That was not enough. For the first time ever, once they were appointed to the board they underwent training by the Director of Social Assistance. So not only were they qualified and competent, we took it one step further and it was the first time in the history of the Department of Social Services.


MR. SPEAKER: Order please!

The hon. the Member for Port au Port on a supplementary.

MR. HODDER: Mr. Speaker, the Minister clearly broke the guidelines of both March 12 and January 30. My final supplementary, Mr. Speaker, is can the Minister explain why his Assistant Deputy Minister, Beaton Tulk, was so anxious to have these retro-active payments made before the end of the year that he wrote the Department of Finance to have the checks manually prepared?

Another question, Mr. Speaker, is why did he write this letter instead of the appropriate ADM of Finance? Did he do it at the Minister's urging? And how involved has he been in all these machinations to get the board reclassified and its per diem raised by 700 per cent? Mr. Speaker, this was not the jurisdiction of the ADM who, I understand, was ADM for Child Welfare.

MR. SPEAKER: Order, please!

The hon. Member is on a supplementary.

MR. HODDER: Why was he involved?

MR. SPEAKER: The hon. the Minister of Social Services.

MR. EFFORD: I know the hon. Member is politically naive and does not know much about the system, but I am totally surprised that after the number of years he has been in politics, and sitting on the Government side after he crossed over, he still does not know the operations of any department. You are a critic and you did not research your answer. First of all, Mr. Tulk, the Assistant Deputy Minister responsible for Child Welfare has responsibility for the Appeals Board. He is the Assistant Deputy Minister responsible for the Appeals Board.

SOME HON. MEMBERS: Ah ha. Now we have the answer. Now we have the answer.

MR. SPEAKER: Order, please!

MR. EFFORD: Secondly, Mr. Tulk did not write the letter to the Department of Finance, it was written by Assistant Deputy Minister C. R. Payne, who happened to be the only Assistant Deputy Minister there at that period, when everybody else had gone home for Christmas. So the hon. Member is not reading the information tabled in the House of Assembly. If you want to ask us some questions, please do some research and know the answers before you ask them.

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

MR. SIMMS: Thank you, Mr. Speaker. My question is to the President of Treasury Board. Last week the Premier tabled some information regarding this whole situation in dealing with the Social Assistance Appeals Board. Included in that information was a note from the President of Treasury Board, as he will recall, to the Premier in which he stated `Under the new guidelines, past practice of payment for travel and preparation time was formalized with no significant change in past practice.' Can I ask the President of Treasury Board, is it not true that at least in the case of the Social Assistance Appeals Board payment for travel and preparation time does represent a significant change in past practice?

MR. SPEAKER: The hon. the President of Treasury Board.

MR. BAKER: Mr. Speaker, as to whether that is true or not we will know shortly and I will inform the House. Just because the hon. Member says it is true does not necessarily make it true. A statement was made a moment ago about a 700 per cent increase, which is totally, absolutely, patently false. For a Member to stand up in the House and say that deliberate falsehood is beyond me. So because the hon. Member says it is so does not mean it is so. We are now going back over the last number of years, beyond two years, to have a look at all the -

MR. SIMMS: A point of order, Mr. Speaker.

MR. SPEAKER: A point of order.

MR. SIMMS: Mr. Speaker, I am not sure Your Honour heard that unparliamentary remark by the President of Treasury Board, but I think he accused the Member on this Side, the Opposition House Leader, myself, of a deliberate falsehood being uttered, and that is clearly unparliamentary.

MR. SPEAKER: The hon. the President of Treasury Board.

MR. BAKER: Mr. Speaker, if it is unparliamentary I will obviously withdraw it. I want to, however, make the point that that statement is obviously not true.

AN HON. MEMBER: Which statement?

MR. BAKER: Well, the statement that was made a moment ago. It is obviously not true. Mr. Speaker, as I said, we will go back and look at the last number of years, at least five years, and we will bring this information to the House as soon as it is all collected, which should be in a very, very short time.

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

MR. SIMMS: Mr. Speaker, I do now know why the President of Treasury Board would have such a difficult time answering the question I asked. It was a question. Is it not so that in the case of the Social Assistance Appeals Board payment for travel and preparation time does represent a significant change? That is a pretty simple question and he should know that by now.

I want to ask him another supplementary and he can comment if he wishes, when he rises - I want to ask him another supplementary, perhaps a couple of others. Can he also tell us what other boards were reclassified? I remember the Premier turning around and referring to the Mining and Taxation, or Royalty and Taxation or something, but what other boards were reclassified? And of those that were reclassified, or where payment for travel and preparation time was provided for, were they also given payment retroactively and would he table all that information?

MR. SPEAKER: The hon. the President of Treasury Board.

MR. BAKER: I do not know where the Opposition House Leader has been for the last few minutes, but I will simply repeat what I have told him. We are now going back over the last number of years, at least five years, with the boards to see if in fact what the hon. Member is saying is true. I do not know if it is true. We are going back and finding out exactly what was paid and to whom it was paid over the last five years, and we will table the information in the House. That is all I can say to the hon. gentleman. I cannot confirm it, because I do not have the information available to me. As soon as it is available it will be tabled. As with many other things we have tabled in this House, as soon as they are available they have been tabled. We will table the information as soon as it is available. Is that okay?

MR. SPEAKER: The hon. Opposition House Leader.

MR. SIMMS: No, Mr. Speaker, it is not okay I say to the Government House Leader. I mean he is saying to us now that he does not know what other boards were reclassified? Because that is the question I asked. And is he also telling us that those that were reclassified, he does not know if they were given payment retroactively? Why does he have to research five years to answer those questions? Those were the questions he was asked.

Let me ask him another one then. Is it not true that Treasury Board established in October that the appropriate level for the Social Assistance Appeals Board was Level 1?


MR. SIMMS: And that you, the President of Treasury Board, then made an oral and verbal presentation to his Deputy Minister in December with respect to changing this decision.


MR. SIMMS: And we also know, of course, that the Minister asked you to reverse the previous decision which Treasury Board had made. But my question is this to the Government House Leader: What was the basis for your verbal argument to your Deputy Minister to have this decision reversed?

MR. SPEAKER: The hon. the President of Treasury Board.

MR. BAKER: Mr. Speaker, if he wants a question answered, I wish he would ask a question instead of ten questions. Maybe that is part of the problem in Question Period, Mr. Speaker.


MR. BAKER: No. Let us see if I can recall now. I dealt with the issue of the Social Assistance Appeals Board, whether that was the past practice of that particular Board. I have dealt with that. Then he has asked me a number of other questions. Originally the request came from the Department of Social Services, the Deputy Minister, indicating she felt that that particular Appeals Board should be at Level II rather than Level I.

AN HON. MEMBER: All of them.

MR. BAKER: All four Boards, yes. Absolutely.

Treasury Board at that point in time - and I cannot recall the exact date now - rejected that and put them all at Level I and, I might add, over my objections. I thought, and I agree with the hon. Member for Humber East who indicates the kinds of decisions rendered, as a quasi-judicial board rendering decisions, that type of decision, I thought it should be at Level II. But Treasury Board is made up of seven Ministers, they overruled me and we put them at Level 1. Then the Minister appealed. I subsequently verbally presented the appeal to Treasury Board, I believe early in December, and Treasury Board at this point agreed yes, that Board should be classified at Level II because of the nature of decisions, and because it is, as I agree with the Member for Humber East, a quasi-judicial board.

MR. SPEAKER: The hon. the Opposition House Leader, a final supplementary.

MR. SIMMS: Mr. Speaker, I am trying to follow what the Government House Leader is saying. If using all of that argument, and I am not sure if he gave a basis for his argument to his Deputy Minister to make the verbal request, but why do you think the same request was not made, for example, for the Child Welfare Board, I think it is, which has all professional people on it - doctors, nurses? They are all professional people I believe on that particular Board, so why would that request not have been made? It seems to me that that is a Board with more expertise? Secondly, can he tell the House also whether the Assistant Deputy Minister of Social Services, Mr. Tulk, already referred to, made any personal representations to the Minister?

MR. SPEAKER: The hon. the President of Treasury Board.

MR. BAKER: In the last question I assume you mean by the Minister to me, because that is the only thing I can have knowledge of. No, he made no appeals to me. It was simply mentioned to me by the Minister of Social Services, and I took it to the Board as I should. That is how that happened. There was no appeal to me at all. No.

Secondly, I would like to point out that what we did by putting that Board at Level I was actually reduce. Up to that point the Chairmen of Level I boards could make $300 a day. We reduced it to $200. And subsequently then, by moving it to Level II put it up to $350. I just want to make sure these numbers are correct. This is exactly what was done. We actually increased it - the possibility of making $300 a day was there, and we now have the possibility of making $350 a day.

MR. SIMMS: (Inaudible) special about (inaudible).

MR. BAKER: Oh, yes.

MR. SPEAKER: Order, please!

I am assuming that the President of Treasury Board is going to answer the question.

MR. BAKER: Thank you, Mr. Speaker.

I cannot answer that. I do not know why a particular board did not appeal; I have no idea. There are a number of things that are taken into account when we consider these things. If, for instance, a lawyer is appointed to a board because that person is a lawyer and we need the legal expertise, there is a totally different rate paid. If a medical doctor - which is what you refer to - is appointed to a board because his medical expertise is needed on that board, there is a completely different rate from the rates for levels one, two and three. If a medical specialist is appointed to a board, I believe the rate is $80 an hour. All this is in the information table.

So, if members have been appointed to boards because of their expertise in a particular field, then, they are paid at a different rate, anyway.

MR. RIDEOUT: Mr. Speaker.

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

MR. RIDEOUT: Thank you, Mr. Speaker.

Mr. Speaker, I have a question for the Premier.

In response to a question from the Member for Harbour Main, asked on Friday, the Premier said that the initial allegation that the Minister of Social Services had intervened to obtain a level 2 classification for the Social Assistance Appeals Board has - and I quote the Premier - `been determined to be totally without foundation, completely false, and fabricated by members opposite.'

Now, I want to ask the Premier, can I take it from that statement that the Premier has completed his investigation into the incident? And, has he found, and satisfied himself, that the Minister of Social Services measures up to the standards and expectations that the Premier is demanding as conduct from members of his Cabinet?

MR. SPEAKER: The hon. the Premier.

PREMIER WELLS: The first thing I will do, Mr. Speaker, is get the full text of what I said and the full context in which it was said, because I do not recollect it that particular way, or that it was in that particular context; then, I will know whether or not the inference suggested by the Leader of the Opposition has any validity whatsoever. Secondly, Mr. Speaker, as the House is aware, there is a full assessment of what went on with respect to those particular individuals and the claims they have made. That is in the process of being done. What I did say is that I was satisfied that the appeal process went through Treasury Board in the ordinary course and that that board was one of two or three or four boards, however many there were, in respect of which Treasury Board agreed it ought to be increased. So the inference suggested by the Opposition that it was a political favour being done by the Minister of Social Services for their friends, I am satisfied has not been made out. I am quite satisfied with that.

MR. RIDEOUT: On a supplementary, Mr. Speaker.

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

MR. RIDEOUT: Well, you see, Mr. Speaker, the Premier, being as glib as he is, just made reference to it again, the political inference made by the Opposition.

Mr. Speaker, the Premier said on Friday that the charges were fabricated by members of the Opposition. Did the Premier determine that from his investigations? Has he, for example, interviewed Mr. Noseworthy, the former Chairman of the Social Assistance Appeals Board, who initially exposed this matter in an interview with the local media. It was not the Opposition, it was a member of the public of Newfoundland and Labrador. Will the Premier tell the House if he considers Mr. Noseworthy's story - and it was Mr. Noseworthy's story that was reported - does he consider that to be fabricated?

MR. SPEAKER: The hon. the Premier.

PREMIER WELLS: Mr. Speaker, as soon as I get a chance, I will look at the Hansard for Friday and determine exactly if what I said was 'fabricated' so that I can report accurately to the House, because my recollection is that what the hon. the Opposition Leader just said is not an accurate representation of the comment. What I recall saying in relation to Mr. Noseworthy is that if Mr. Noseworthy wants to say anything to me, my office door is open and I invite him to come and do so. I have no intention of tracking Mr. Noseworthy down to see what he has to say, but if he has some complaint to make, my office door is open and he is free to come, and I would be quite pleased to hear him.

I am satisfied, from my discussions with the President of Treasury Board and everybody else in relation to this matter that I have talked to, that the ordinary process of appeal was in the ordinary course of things.

MR. RIDEOUT: Mr. Speaker.

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

MR. RIDEOUT: Mr. Speaker, what the Premier is saying to

the House now is that there was no investigation, it was just a fraud perpetrated by the Premier to cover up for his Minister. That is what it was. Now, Mr. Speaker, if the Premier was interested in conducting an investigation and getting all the facts that were alleged by somebody else, not by Members of this group over here, will the Premier tell the House why he would not attempt to interview Mr. Noseworthy and determine whether or not his allegations were fabrications or not? Why would the Premier not do that?

MR. SPEAKER: The hon. the Premier.

PREMIER WELLS: I did not say Mr. Noseworthy's allegations were a fabrication. I do not recall saying that anywhere. But again I will look to see if the Opposition Leader's representations are accurate. What I did say, Mr. Speaker, is that I would undertake, as I did, to do an examination of how this appeal board's status was altered and I did, and I tabled a full correspondence in the House. And the President of Treasury Board who had a personal involvement has filled in anywhere where there was no correspondence and he explained there were some circumstances where there was no correspondence. All that has been tabled and explained in the House.

Mr. Speaker, I see no necessity for chasing Mr. Noseworthy around to see what he wants to say. If Mr. Noseworthy has anything that he wants to say to me, as I said in the House on Friday, I said earlier today, I repeat again, my door is open to Mr. Noseworthy.

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

MR. HEARN: Thank you, Mr. Speaker. Some time ago when the Minister of Education gave us a breakdown in the layoffs in the educational system he mentioned that approximately 133 would be affected at the secondary- elementary area. Will the Minister tell us if he included school boards' support staff in these numbers?

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

DR. WARREN: No, Mr. Speaker.

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

MR. HEARN: Mr. Speaker, will the Minister now admit then, because of his freeze on funding the school boards, which has actually meant a severe reduction in the amount of money they will have this year, that a number of support personnel will be laid off at the school board level?

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

DR. WARREN: Mr. Speaker, I want to clarify the 133. The 133 included 122 teaching positions that would have been eliminated as a result of declining enrollments. So the 133 are not as a result of fiscal restraint - one hundred and twenty-two of these I think were as a result of declining enrollments. Mr. Speaker, I indicated in the House that there were some positions being eliminated by school boards but until the end of the year it is difficult to find out how many. In St. John's, I saw in the press approximately twenty. I checked out and found that a number of these are being transferred.

But until the end of the school year it is difficult to project how many positions will be eliminated. And secondly I am finding it very difficult to determine how many positions are being eliminated, period, for a variety of reasons, including dropping enrollments, and how many positions are being eliminated as a result of the fiscal restraint measures the Government has taken.

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

MR. HEARN: Thank you, Mr. Speaker. The Minister is well aware that the reduction in funding the school boards' staff, or to school boards, means that the school board personnel have very few options in dealing with what is under their charge. The only flexibility they have is in personnel. And will the Minister admit that due to the fact that they will have to exercise their only option in laying off school board personnel - especially in the maintenance area - that this could propose or create a real problem in keeping the schools clean and in a healthy condition? And is he worried about that?

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

DR. WARREN: Mr. Speaker, we did freeze the per pupil grants to school boards this year. Enrollments are going down and therefore the amounts of money that school boards will get from the maintenance grant will decrease. But the school tax system has become increasingly efficient and this year, this 1991-1992 school tax revenues, are expected to increase by 5 per cent to 6 per cent. So in effect, even with the freeze on salaries, Mr. Speaker, school boards will have more money for operation and maintenance of schools this year than they had last year.

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

MR. HARRIS: Thank you, Mr. Speaker. My question is for the Minister of Education -

SOME HON. MEMBERS: (Inaudible).

MR. SPEAKER: Oh, sorry, sorry. I recognize the hon. the Member for St. Mary's - The Capes, one more supplementary.

MR. HEARN: Final supplementary, Mr. Speaker. The Minister skated away from answering the question about the healthy conditions of the schools. But will the Minister admit that school boards may not have as much funding? They are not getting as much from Government. Will he admit that they may not get as much from school tax authorities because the Premier's promise to either abolish or change the school tax authorities has left a tremendous number of people out there saying: we are not going to pay our taxes because the Premier says he is getting rid of the school tax system and consequently they are not making their contributions to school boards.

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

DR. WARREN: Mr. Speaker, I am pleased to say that people are paying their taxes and school boards will have more money next year as a result of school taxes and grants than they have this year. Secondly, Mr. Speaker, school boards and their employees do an excellent job in keeping the schools clean, and I am sure they will continue to do that, Mr. Speaker.

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

MR. HARRIS: Thank you, Mr. Speaker. My question is for the Minister of Education. We have heard now from the Cabot Institute and the Avalon Community College of their cutbacks as a result of the Budget after much consultation with the Minister's Merger Implementation Committee. I wonder whether the Minister can confirm that this is the end of the lay offs and cutbacks there, or do we expect more cutbacks and more lay offs in those institutions once the merger is complete?

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

DR. WARREN: Mr. Speaker, I will not say there will not be more, but I think most of the lay offs as a result of the restructuring have already taken place. There may be, and I want to stress this, Mr. Speaker, we are rationalizing the post-secondary system because we felt that there was certain overlapping. There was certain repetition in courses and duplication. Mr. Speaker, there may be, as a result of eliminating duplication, there may be additional lay offs, but I do not expect these to be large numbers. But we are attempting to make the post-secondary system more efficient, and very shortly, Mr. Speaker, I will be making additional announcements about new boards and new executive officers and other elements of the restructuring programs.

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

MR. HARRIS: Yes, my next question was to be about that, Mr. Speaker, and I wonder if the Minister can advise the House when he will be naming the new president of the merged Institution. Can he be more specific when talking about the near future? There are a lot of people whose careers are at stake and would like to know the answers to these questions.

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

DR. WARREN: Thank you, Mr. Speaker. As the hon. Member knows we have at the present time five community colleges and three institutes. As a result of the restructuring, we will reduce that number to - and if you include Memorial we have nine - to five or six institutions. So there will be some down sizing in number of boards, in governors, and also chief executive officers and other leadership persons in these colleges. I cannot give him a date. Mr. Speaker, we were going to do it this fall, but because of the fiscal restraint and the crisis that we faced economically in the last while, we have had to move it up. So I would say in the not too distant future we will be making some of these announcements, Mr. Speaker.

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

MR. HARRIS: Thank you, Mr. Speaker. While he is at it, I wonder if he could tell the House when we can expect to hear that he will be replacing the Deputy Minister. When will we have a new Deputy Minister of Education to announce to the House?

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

DR. WARREN: Mr. Speaker, I am sure the hon. Member is aware that is the Premier's prerogative in the appointment of Deputy Ministers. I might say that Dr. Winter is staying on until the end of June, and we are delighted with that, he is an outstanding public servant, and I am sure the Premier will make that decision in due course, Mr. Speaker.

MR. SPEAKER: The hon. the Member for Burin - Placentia West, time for a short question.

MR. TOBIN: Mr. Speaker, last week the Minister of Municipal Affairs promised the House that he would be giving some information as it relates to the capital funding program for the Department of Municipal Affairs. Councils in this Province are eagerly awaiting as to when the announcement will be made. Will the Minister tell the House today when he will be making the announcements and stop procrastinating on that decision.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The hon. the Minister of Municipal and Provincial Affairs.

MR. GULLAGE: Mr. Speaker, what I said to the House last week was the capital works, water and sewer and roads was in the final steps of preparation, and as soon as it was finalized and priorized by officials in my department and myself, and then subsequently approved by Government, it would be announced. We are getting very close to finalization, Mr. Speaker, and it will be announced in due course.

MR. SPEAKER: Question Period has expired.

The hon. the Member for St. John's East on a point of order.

MR. HARRIS: Thank you, Mr. Speaker.

I want to raise a point of order arising out of Question Period just for clarification. In Question Period today Your Honour recognized me as the Member for St. John's East and I commenced to ask a question. Your Honour then reverted to the Member for St. Mary's - The Capes. Now, Mr. Speaker, I know you recognized me after that and I did get to ask the questions as I had intended to, but as a point of order it has happened on occasion in the past. I understand that once I have been recognized and I have been given the floor and have commenced to speak that in fact I do have the floor. Just as a point, Mr. Speaker, it is rather disconcerting to commence a speech and have that interrupted. I wonder if Your Honour would be prepared to make a ruling on whether or not it is appropriate to do that. I have in the past also been asked, and have been willing to give way to a speaker in similar circumstances.

MR. SPEAKER: The hon. the Leader of the Opposition would like to make a submission.

MR. RIDEOUT: I just want to make a brief submission, Mr. Speaker. I think there are two points which need to be clearly understood here. First of all it is quite normal when the Speaker recognizes any Member asking a question, including the hon. gentleman, that the Speaker will determine how many supplementaries that person gets to ask. Normally, it is two or three, and quite often if there is nobody else standing the Speaker will let the person go on much longer. That has been the practice and tradition in this House. In any event, what I want to say is it is the discretionary call of the Speaker and Mr. Speaker will do that as he sees fit.

Secondly, it is quite possible that sometimes in the dynamics and flow of Question Period the Speaker will have noticed the hon. gentleman standing but did not notice the person who was previously recognized as standing to ask another supplementary. But when it is called to the Speaker's attention or the Speaker happens to glance sideways, he sees that person standing again and will revert to him. I have seen that happen in this House on numerous occasions over the years I have been here.

Thirdly, Mr. Speaker, the final point is this, it could quite conceivably happen in the case of the hon. gentleman sometime soon, I do not know if it has happened in the past few weeks or not, but it could happen sometime soon and I am sure he would not want his flow of questions interrupted and he would expect the same courtesy to be extended to him, as I am sure it would be.

MR. SPEAKER: To the point of order, I would suggest that the Member for St. John's East certainly made a point and the Leader of the Opposition clearly made some points which are followed by the Chair in this House. Quite clearly when the Chair recognizes somebody, that person has the right to continue. I suppose the correct procedure for the Chair would have been to have asked the hon. Member for St. John's East whether or not he would allow me to go back to the Member for St. Mary's - The Capes, but as the Leader of the Opposition pointed out, in this House in Question Period normally when a person is going on with some questions we allow him the flow unless it has been excessively long. I looked at the clock and knew that the hon. Member for St. John's East was going to get into Question Period unless the Member for St. Mary's - The Capes was going to be excessively long - but I would not allow him to be excessively long. I suppose the Member for St. John's East technically has the right to impeach the Chair if he wants to.

Presenting Reports by

Standing and Special Committees

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

MS. VERGE: Mr. Speaker, I am rising at this point to express concern about what has happened to the Social Legislation Review Committee. That Committee, chaired by the Member for Carbonear, was relatively active dealing with proposed legislation but suddenly, six weeks ago or so, the Committee ceased to function yet we had not concluded our deliberations on three important Justice Bills which are now on the Order Paper and which the Government House Leader indicates he wants to call soon. Those bills are the new Provincial Court Act, the new Juries Act, and an amendment to the Evidence Act, all important and relatively controversial. Now the Government is about to propose consolidated Legislation Review and Estimates Committees, but in the meantime the Government Services Legislation Review Committee has continued to function. I would like to raise with Your Honour my concern that the Social Legislation Review Committee may not be able to complete our work on those three Justice Bills before they are dealt with by the full House of Assembly, and so I would ask Your Honour to discuss with the Government House Leader having, perhaps, the old Social Legislation Review Committee complete our work on those three bills before we move on to the reforms?

MR. SPEAKER: Order, please!

I am not so sure that the Chair should get involved in those matters of Committees. I wanted to clear that point. I do not know whether the hon. Member got up on a point of order. That is quite appropriate. I was thinking she was standing under Presenting Reports by Standing and Special Committees. So since the Member got up under a point of order, that was the right and proper thing to do. The Chair can only rule that with respect to committees the committees have to decide their own ways of operating, and the Chair would have to say that is not a point of order at this point in time.

The hon. the Opposition House Leader.

MR. SIMMS: On a point of information or a point of privilege or something. I noticed that the Government House Leader was about to stand and rise and respond. I think it would be for the benefit of all Members of the House notwithstanding Your Honour's ruling, which is an appropriate one and a proper one, but I think we would be interested in hearing the Government House Leader's response because I think the Member for Humber East raises a valid point. So under the guise of a point of order, could he respond?

MR. SPEAKER: If the House so consents.


MS. VERGE: We consent.

MR. SPEAKER: The Government House Leader I gather does not want to respond and, of course, the Chair cannot force him.

Notices of Motion

MR. SIMMS: After the beating he took in Question Period we are not surprised.

AN HON. MEMBER: It was a nice try.

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

MR. RAMSAY: Mr. Speaker, I give notice that I will on tomorrow ask leave to introduce the following resolution: Whereas the winter fishery on the southwest coast is the primary fishery for fishermen and fish plant workers from the communities of LaPoile, Petites, Rose Blanche, Harbour Le Cou, Burnt Islands, Isle aux Morts, Margaree, Fox Roost, Port aux Basques, Cape Rae and Codroy; and

WHEREAS the winter fishery is utilized primarily by over 100 inshore mobile gear vessels from many communities in the Province which catch up to 50 per cent of their vessel quotas during the winter fishing season; and

WHEREAS the catastrophic failure of the fixed gear fishery on the southwest coast has placed even greater pressure on the mobile gear catch and also on the processing sector to provide employment for the residents of the area; and

WHEREAS the winter fishery has seen much difficulty over the past number of years insofar as the orderly progress of the fishery has been repeatedly interrupted by disputes over its management by the Department of Fisheries and Oceans;

THEREFORE BE IT RESOLVED that this hon. House encourage and support the establishment of a regulatory committee consisting of representation from the Provincial Government, the Federal Government, the fishermen, processors; and

THEREFORE BE IT FURTHER RESOLVED that the Federal and Provincial Governments work together to establish an effective mandate for this proposed regulatory committee, the intent of which will be joint management of this important resource.

MR. RIDEOUT: Do you want to vote on it now?

MR. SIMMS: Do you want to vote on it now, without a debate?

MR. SPEAKER: Any further Notices of Motion?

Answers to Questions

For which Notice has been Given

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

MR. GILBERT: Thank you, Mr. Speaker. The hon. the Member for Torngat Mountains asked the Premier and I some questions concerning school bus safety in Goose Bay. I would like to table the answers now.

MR. SPEAKER: Are there further Answers to Questions?

The hon. the Minister of Social Services.

MR. EFFORD: Thank you, Mr. Speaker. Mr. Speaker, last week I was asked to place upon the table of the House the number of trips made by the Minister of Social Services in 1989, for the last year, and the destination and date of the trips - 1990, I should say. The destination and date of the trips, the length of the trips, the purpose of the trips and the names of personal, political, and departmental staff accompanying the Minister.

I do not have all the information written down, but I clearly explained it. The destination is here, and the purpose of the trip. I have only made one trip out of the Province for the full year. At no time did I take any personal staff on a trip within the Province or out of the Province, and no departmental staff within the Province at all. The purpose of the trip was only departmental business within the Province. The other thing, Mr. Speaker, in 1988, my only question is -

MR. SIMMS: On a point of order, Mr. Speaker.

MR. EFFORD: I would ask the former Minister, Mr Speaker, to provide an answer to the question, why would he rent a fixed wing aircraft to make four trips to the Burin Peninsula?


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

The hon. the Opposition House Leader on a point of order.

Mr. Speaker, he is not allowed to table that information because Your Honour has already ruled in the past that that is out of order, providing information that was not even asked for. I mean, that is a little trick they try to employ.

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


MR. SPEAKER: Order, please!

MR. BAKER: Mr. Speaker, my recollection is that the previous ruling had to do with private Members and their rights and ability to table documents in the House, and my understanding is that a Minister can table the documents associated.

MR. SPEAKER: I will check the propriety of that and report back to the House, but obviously it is only necessary to report the information for which one is asked. There is no need to get into extraneous information.



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

MR. HEWLETT: Thank you, Mr. Speaker. I rise to present a petition from 184 residents of Little Bay Islands, a delegation from which visited with the Minister of Transportation this morning.

The prayer of the petition to the hon. House of Assembly is as follows: We, the undersigned residents of Little Bay Islands in the electoral district of Green Bay, humbly petition the hon. House of Assembly not to make any changes to our ferry system which would see the combining of the ferry system between Little Bay Islands and Shoal Arm and Long Island and Pilleys Island, which would result in the termination of Little Bay Islands mainland terminal at Shoal Arm. Should Shoal Arm be omitted from the service, then the results could be disastrous to the livelihood of Little Bay Islands. The main source of employment at Little Bay Islands is the S. T. Jones fish plant which depends on product being trucked in. To ensure this is done in the speediest way possible, Shoal Arm is a necessity. Shoal Arm also provides us with the quickest and cheapest route to Springdale, our main centre for all our essential needs, from heating fuel to medical facilities to groceries to banking, shopping etc. We urge you to consider all these points before making a decision that could adversely affect the lives of the residents of our island community.

As I indicated, this petition has been signed by 184 people from Little Bay Islands, which I would say is a very sizable percentage of the entire adult population of that particular island. But in this Assembly last week I presented a petition outlining the concerns of the citizens of Long Island with regards to this proposed amalgamation of ferry services. Many years ago, the Federal Government ran the small ferry services in our district and the agony that was gone through every spring to develop an acceptable joint ferry service, one boat, both islands, became an annual spring ritual.

Now as of this Budget Speech we see again the Government has come forward with an amalgamation, at least for six months of the year, of the two ferry systems concerned, and whatever the Minister's final decision - he has indicated he will give a final decision to both islands pretty soon - I am sure there is a good possibility that one or both of the islands will be dissatisfied with the outcome of the period of amalgamation and next spring we shall again see another procession of people from Long Island and Little Bay Islands in to the Transport Department to make their case.

The economy of Green Bay is bad enough as it is, but right now this particular move on the part of Government is lending itself well to the hotels and businesses and malls in St. John's, because they are getting delegations from six to eight hours' drive away into the capital city who would not ordinarily be here.

This move to amalgamate the two ferry services, to fool around with and fix that which is not broken, is going to set the transportation system of these two particular islands back for quite some years. Each island has its own particular interest, its own community of interest, its own economic interest. Long Island has a fishery, Little Bay Islands - as is indicated in this particular petition - has a fish plant, a fish plant serviced quite often by fish trucked in and out, processed and non-processed, to an island. And during the brief time of the year when there is a crab fishery on Little Bay Islands, even though it is a relatively small island in terms of population, labour actually has to be imported for the intensity of the crab processing season.

So obviously the transportation system for the people of Little Bay Islands is extremely important in maintaining their economic livelihood and their way of life.

The Minister now has it before him and he can if he wishes get Government, his colleagues in Cabinet, to back off this retrogressive step and to allow things to go back to the way they were, leave both islands as they are. The amount of monies that will be saved are not going to be worth the annual pain and anguish of schedule setting every spring.

The Government has indicated that it will not accept any revenue options; the people are not going to be allowed to pay extra for a service they currently enjoy, even though they volunteered to do so. So obviously the intent on the part of this Government is to downsize the ferry system, which is just another indication of the downsizing of Provincial Government presence in rural Newfoundland. The loser, Mr. Speaker, in this situation will be the two individual islands concerned, the District of Green Bay in particular, and rural Newfoundland in general.

Mr. Speaker, if the Provincial Government shrinks efficiently so as to withdraw from the rural economy of this Province, the rural economy of this Province just may collapse; the medicine, Mr. Speaker, may kill the patient. I thank you, Mr. Speaker.

MR. SPEAKER: The hon. Member's time is up.

The hon. the Member for Kilbride.

MR. R. AYLWARD: Thank you very much, Mr. Speaker. I wish to rise in my place and support the petition so ably presented by the Member for Green Bay on behalf of 184 residents of Little Bay Islands.

Mr. Speaker, once again we have another petition pleading with the Government to try to keep their transportation system as it was. Not to improve it, not to spend extra money on it, not to get new boats, but to try to keep the system in place as it was so that the people could at least continue the service they have always had.

Mr. Speaker, this decision by Government to eliminate this ferry service or to tinker with the ferry service that operates in this area now is going to have a detrimental effect on the fishery and the fish plant on Little Bay Islands. It is going to have a detrimental effect on more services for rural Newfoundland. We have seen already this Government take away medical services from rural Newfoundland and educational services from rural Newfoundland, and now the transportation services of areas of rural Newfoundland are being affected.

Mr. Speaker, two years ago, I believe it was, the Government came out with a great announcement, that they were going to reduce the cost of inter-provincial ferry services within this Province so that the cost would be phased down so that it would not be any more than travel by highways. We now see why they are reducing the charges for ferry transportation services. It is because they are intent on eliminating these services. Mr. Speaker, they will upset the people so much by downgrading the service that the people will not be happy with the service they have. Already we have seen it from Bell Island. I noticed in a news report last week that the people are saying, `we do not mind paying for the service, if you will give us the service.' You can eliminate the charges completely, Mr. Speaker, if you are going to eliminate the services. The people on these islands desperately need the type of transportation services they have now, and they have already said on at least two occasions, I have heard, that they would be willing to pay for the transportation service they have now. They do not want the charges reduced if their service will be reduced.

Mr. Speaker, we see again delegations coming to the Minister and the Minister putting them off: We will put them off for another couple of weeks. We will say we will not finalize our decisions, and let them calm down a bit. Hopefully it will die out, and then we will make the same decision in a month's time that we have already made and have no intention whatsoever of changing. They are going through the meetings with these delegations as a matter of formality. The Minister is sitting there listening to these delegations when he knows full well in his heart and soul that he is not going to change the decision he has already made. He is going to downgrade the service and eliminate ferry runs for this area, Mr. Speaker, and he should be honest with the people when they come in, look them in the eye, and at least have the intestinal fortitude to say to them right then and there, `The decision has been made and I will stick with it as long as I can.'

Now, Mr. Speaker, the Minister might tout his policy as reducing the charges to people using these ferry services, but if you eliminate the service, it doesn't matter what you charge, people will not use it, they will not be able to use it.

I suggest that the Minister review the policies he has brought in and look at these services as essential services to the people who live on the islands. Do not try to eliminate the service, do not try to downgrade more services to rural Newfoundland. The Little Bay Islands area is a viable community, Mr. Speaker, with a fish plant that provides employment for people all around that area, and the transportation service is very critical to those people.

So I implore the Minister, when he meets with the next delegation coming in, to tell them the facts, and hopefully these facts will lead to continuing the service the people have in that area right now.

MR. SPEAKER: Order, please!

The hon. member's time is up.

MR. GILBERT: Mr. Speaker.

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

MR. GILBERT: Thank you, Mr. Speaker. I will have a few words on this petition. I was very happy I was able to meet with the people from Long Island and the people from Little Bay Islands, and to have their input before the final decision is made. I am sure hon. members are aware that the decision to try to improve the ferry service to Little Bay Islands and to Long Island was made as a budgetary process and, as I said to both groups when they were in, we could very arbitrarily decide, okay, we are going to do it; but the people making this decision, the people living in St. John's or Grand Falls and looking at the circumstances, do not live in Little Bay Islands or on Long Island. So for this reason I wanted to have input from the people, to see if they had any suggestions that might improve the changes we were talking of making in order to save some money.

The point I would like to make, first of all, is that the gentleman from Green Bay and his group were in Government for about seventeen years and when we came in we were left with a $5 billion deficit. Now, as I have alluded to a couple of times in this House, maybe if they had not spent $2 million on the Green Bay Transport I, when they were initiating this service, when they took it over from the Federal Government, we would have some money now to be able to carry on the service they are fighting for right now. Unfortunately, $2 million was wasted in putting this service in at first.

The gentleman from Kilbride and the gentleman from Green Bay talk about reducing the cost. They realize it was a very positive approach that we took when we formed the Government as far as providing ferry service to the people was concerned. The people from Little Bay Islands even admitted to me this morning that it was a very positive thing and they agreed that it should be, that this ferry service is their road, an extension of the road, and it should not cost them any more to get there than it does to drive.

So as I pointed out to them, no matter if we increased the cost for the people of Little Bay Islands or Long Island to the user-pay, it would still not do any good. The whole process is that there would not be enough collected in revenue to provide the service. So we realize this is a lost leader operation. We are providing a service to the people of Newfoundland. The policy of this Government is to provide it at the same cost for which they would drive over that distance.

Now we are looking at the total service we are providing to Little Bay Islands and Long Island. We will be making the final decision as to how best to implement the budgetary decisions announced in the Budget in this House. And as I told both groups when they came to make their presentations, I was very glad they came; I wanted to hear exactly any ideas they had; I asked them to understand the financial implication and the financial situation

this Province was left in after seventeen years of misrule.

I will be making a decision on it this week and I will be telling the people next week exactly what system is going to be in place, not, as the Member for Kilbride indicated, that I was going to try to put them off. I wanted to hear what they had to say. They are the ultimate users, the ones who will have some good ideas as to how we can best implement this service.

Orders of the Day

MR. BAKER: Motion 4, Mr. Speaker.

On motion, that the House resolve itself into Committee of the Whole to consider Bill 15, the imposition of tax on gasoline,

Mr. Speaker left the Chair.

Committee of the Whole

MR. CHAIRMAN: Order, please!

MR. SIMMS: A point of order, Mr. Chairman.


The hon. the Opposition House Leader on a point of order.

MR. SIMMS: Again, just so we can get the speaking rules: the same as we understand any time you are debating a Finance Bill in Committee, the Minister and the critic can get up to an hour if they need it, which I doubt, and everybody else ten minutes at a time back and forth as often as they want.


MR. SIMMS: Okay.

MR. CHAIRMAN: The hon. the Minister of Finance.

DR. KITCHEN: Mr. Chairman, I presume if I go over an hour I may get leave to continue.


DR. KITCHEN: Thank you, Mr. Chairman. It may happen, but it is unlikely.

In the Budget we discussed the gasoline tax and I will just refresh Members' memories on what was said then as a lead-in. We said the desire for revenue stability has given us cause to re-examine the Province's gasoline tax regime. The existing ad valorem system sets the tax in cents per litre at a specific percentage of the average retail price of the product. The recent oil price increases could have permitted provincial taxes to rise substantially, but in the interest of consumers Government did not adjust this tax from November 1, 1990 to March 1, 1991. This decision kept pump prices as much as two and a half cents per litre lower than they otherwise would have been. The volatility of oil prices has resulted in the need for more stability and certainty in fuel taxation for both Government and consumers. Accordingly, as I said in the Budget, I am announcing that effective immediately Government will move to a fixed rate regime; the tax will be fixed for at least this year at the current rates of 13.7 cents per litre and 15.6 cents per litre for diesel. As these rates are already in place, the measure will not result in any change in pump prices.

Mr. Chairman, what this Bill does basically is change from an ad valorem system to a fixed-rate system. Before, the old way, what we used to do was take a survey no more frequently than monthly of all fuel retailers, and the average retail price at the pumps would be calculated, including the federal excise taxes and GST, and then a fixed percentage would be added to that, 23 per cent, for gasoline and that would be the tax, so much per litre. But it would be based on the retail price of the gasoline.

We did a survey on February 12, I think it was, our last survey, and we calculated that it would be 13.7 cents a litre if we brought in the change, and we did. It was formerly 12.4, and it had been rising from May 1990 when it was 11.3. But we pegged it at 12.4 for a number of months, as we indicated. But then we anticipated that gas prices would be declining as a result of the decision taken in the eastern war, and consequently we decided that to protect our revenues, to keep them constant so that we could predict what was going to happen revenue-wise, we would go with a fixed-rate system of 13.7 cents a litre, which at that time turned out to be 23 per cent of the average retail price. So we decided we would fix that 13.7 cents and forget about the 23 per cent. And for diesel which had been 27 per cent of the average retail pump price less provincial taxes, that turned out to be, on February 12, 15.6 cents a litre. So we froze that as of March 1. Then in the Budget we decided we would change to the fixed rate, so many cents per litre.

I might indicate that almost all provinces now have that system, so many cents per litre, rather than a percentage of the price. The only provinces which now have a percentage of the price are Prince Edward Island, Nova Scotia and British Columbia. Up until recently, six provinces, including us, had the fixed rate per litre. Then in their recent Budget New Brunswick went the same way we did, just before our Budget. I guess that is mostly what I want to say.

The advantages of bringing in this tax in this way, of making it a fixed rate per litre rather than a percentage, is that we can predict our revenues more accurately. And also, with the price of gasoline going down as a result of the cessation of the Gulf War, we keep our revenues up a little bit.

I can lead Members through the items in the bill. I think perhaps I will do that, and just look at the various clauses here. The first clause says paragraph 2 (a) of The Gasoline Tax Act of 1978 is repealed; and 2 (a) is just the definition of average retail price. We no longer need to know that because we are not going to calculate it in that fashion.

Then we go on to subsection 3 (1). If we adopt this bill it will say `a person who acquires gasoline at a retail sale in the province shall pay to the Crown at the time of sale on all grades of gasoline other than diesel fuel grade of gasoline a tax of .137 per litre.' Before, the old 3.1 fixed it as the percentage of the retail sales. So that is gone and now it is the fixed amount per litre. And diesel is done the same way, it is fixed at a certain number of cents per litre rather than a percentage of the average retail price of diesel per litre.

Now section 3 of the new bill which says this may be a bit puzzling to Members, so I will just follow that through with you. Section 3.2 of the Act is amended by striking out the words `a tax rounded down to the nearest one-tenth of a cent per litre that is equal to 22 per cent of the average retail price less one and a half cents per litre' and substituting the words `a tax of .122 per litre'. That is rather confusing until you realize that what it is referring to is that in southern Labrador, extending from the border with the Province of Quebec to and including the community of Red Bay, in respect of the consumption or use of gasoline in that area shall pay to Her Majesty at the time of the sale, now it will read a tax of .122 per litre. Before it was 23 per cent of the average retail price less one and a half cents per litre. So there is a break in the legislation. There always was for those few communities in southern Labrador and that is still preserved in the new legislation. So we have not tampered with that. And Section 47.1 of the Act, that is just a reference to... is that 47...? Hang on now, I will find out for you. That just says: the Minister may by order set out the manner and method in which the average retail price of gasoline diesel fuel grade may be determined. That refers to the survey that we used to conduct. And that is now repealed. There is no reference to that. It is now: the Minister has no discretion. It just must be 13.7 cents a liter for gasoline and 15.6 for diesel.

And that is basically all I prefer to say at the moment, I think. Just let me check it over here now. I think I will leave it like that, Mr. Chairman, and if there are further questions or any questions I will try to answer them.

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

MR. WINDSOR: Thank you, Mr. Chairman. The Minister never ceases to amaze me. I have been here trying to prepare a case now for my speech to present to the House, to prove to the House that what the Minister is doing is trying to protect his revenues. And the Minister stood up and told us he is trying to protect his revenues. I am absolutely speechless that the Minister would so blatantly admit exactly what he is doing. It is exactly what we said he was doing at Budget time. In view of the high price of petroleum products as a result of the Gulf War, the Minister - who was having a field day, he was really getting a windfall from the price of gasoline and I recognize that the Minister of Energy did not make all the adjustments he could have. It could have been much higher, but he was doing very well, thank you. He was doing very well on the ad valorem basis.

So what the Minister did at Budget time was freeze the ad valorem amount, or the equivalent of the ad valorem, at 13.7 cents per liter, he told us, which was roughly equivalent to 23 per cent on the base rate, on the base cost of gas that was being used for the calculation at that time. And we accept the fact that the Minister could have increased that, based on a survey at the pumps, slightly, probably another couple of cents.

But the Minister has just admitted to us that he has indeed - now that we had such a high rate, and knowing that the price of gasoline was going to drop, that is at the end of the Gulf War - that he protected his revenue. In other words he will now continue to charge us at the high rate, based on a straight percentage basis instead of the old ad valorem. Had we stayed at the ad valorem the price of fuel would have dropped substantially to this point in time. We would be paying far less at the pumps today than we are.

Now it is interesting to look back over the history of the Minister. In his first budget in 1989 he raised that ad valorem from 22 per cent to 23 per cent. That was the first increase since 1981. Because 22 per cent was probably a pretty fair percentage of tax to place on gasoline. The more expensive gasoline became, on the wholesale price, obviously the more tax the Minister got, but the percentage was consistent and it was felt that that was reasonable. In 1989 the Minister chose to take another per cent and raised it to 23 per cent. So we saw an increase there. Now he has frozen it. Now, it is interesting to look at some very basic mathematics when you look at what the Minister in fact is doing. This requires spectacles.

We are now paying 13.7 cents per liter. The price of gasoline at the pumps now, generally you can get it for - well, it varies a little - but 62 cents per liter is probably not an unreasonable figure to use. That is the one I have chosen and if somebody wants to argue it should be 63 cents or 64 cents, that is fine. But I am using 62 cents per liter, which can be found around the city at least, it is obviously more expensive in other parts of the Province, and particularly in Labrador.

That means that the base price is 48.3 cents per liter. That is the base price, the wholesale price, of gasoline. Therefore the effective rate we are now paying is 28.4 per cent. That is how much 13.7 cents is of 48.3 cents per liter. So what the Minister has in effect done is increase the ad valorem rate - were we still on ad valorem, from 23 per cent to 28.4 per cent, a 4 per cent increase in the ad valorem rate. That is in effect what he has done. And if you follow that a little bit further and you say: well, we should be paying 48.3 cents plus 23 per cent, in other words 59.4 cents per liter instead of 62 cents, 2.6 cents per liter less.

AN HON. MEMBER: (Inaudible).

MR. WINDSOR: The President of Treasury Board is lost. If 62 cents - this is very simple, basic mathematics - is the present price at the pump and that includes 13.7 cents of tax, therefore the base price is 48.3 cents per liter. Now if you multiply that by 1.23, which would have been based on the old ad valorem rate, then you would have come up with 59.4 cents per liter, is what we should be paying. Had the Minister not introduced this motion, this bill, if we were still paying 23 per cent on 48.3 the price today at the pump would be 59.4 cents, or 2.6 cents per liter less. I mean, just for comparison purposes, if one -

AN HON. MEMBER: (Inaudible).

MR. WINDSOR: It is very simple, basic - I am only an engineer, Mr. Chairman but that is pretty basic mathematics. I even checked it on my trusty little computer if the hon. Member would like to borrow it. I mean, this is Grade 2 mathematics we are talking here. If I am wrong I will apologize profusely. I invite the President of Treasury Board to check that, but it is pretty simple mathematics.

Now if you were going to fill up your vehicle today, at the price we are paying today it is not unusual to put $40 worth of gas in your car. On the way here I filled up my car, she took $39 and something cents.

SOME HON. MEMBERS: (Inaudible).

MR. WINDSOR: I am sorry?

SOME HON. MEMBERS: (Inaudible).

MR. WINDSOR: Where was it 80 cents per liter? It might be in Labrador, 62 cents was the present price..

MR. BAKER: Would you do that calculation and see? Maybe we are losing there, you know.

SOME HON. MEMBERS: (Inaudible).

MR. WINDSOR: I can do it, no problem. If it was 80 cents per liter and we are paying 13.7 in tax, that means that 66.3 is the base price, right? So if I take 13.7, divide it by 66.3, that is 21 per cent. If the price was 80 cents, but it is not. The price is 62 cents, of which 13.7 cents is tax, and that means 28.4 per cent is the tax rate we are paying on gasoline today. Now that is very, very basic calculation.

So on a $40 fill up, Mr. Chairman, which is an average, unless you are driving a very small car, but you know, $40 is not unusual today, or other words 65 liters. On 65 liters you are paying $1.69 more every time you fill up your car today than you would have without this amendment, $1.69. And if you want to go back another one, to 1989, or prior 1989, where the ad valorem went up, you want to work it at 22 per cent instead of 23 per cent, you are paying $1.95 per fill up extra.

Over all, today, it is interesting, until you look at it you do not realize it. On a $40 fill up today at a service station, at 13.7 cents per liter and 65 liters, so the mathematics is straight, you are paying $8.91 every time you fill up your car. That is the tax you are paying, $8.91. In other words, with the $1.95 extra we are paying today 128 per cent over what we would have paid at the pump prior to the Minister coming into office. In other words, if we were still at the 22 per cent ad valorem rate that this Government inherited, we would be paying 28 per cent less than we are paying at the gas pump.

So we see a tremendous rise in the price of gasoline in the Province. It is interesting. You add to that - you must consider of course, consumption is going up. So when we simply take the Minister's Budget and we see he is estimating this year $98.7 million in revenue from gasoline tax, based no doubt on this new legislation, and we look at the revised figure for 1988-1989, the last year of our administration, the revised figure as presented in the Minister's Budget of 1989-1990 showed $72.8 million dollars. In other words, $25.9 million more this year than in 1988-1989. And that is a 36 per cent increase in the amount of revenue gained from gasoline tax.

AN HON. MEMBER: (Inaudible).

MR. WINDSOR: More consumption, yes. But a 28 per cent increase in taxation. That tax rate has increased. The present rate over the 22 per cent ad valorem is a 28 per cent increase. The actual revenue was increased by 36 per cent because of increased consumption. I do not have a problem with that. Obviously if you are going to have increased consumption you are going to have increased costs, and one looks after the other.

But that is what has happened. And the Minister amazingly enough has just admitted that the reason that he has decided to go to the fixed rate, flat rate, instead of the ad valorem rate is to protect his revenues, because he suspects the price of gasoline may go down. Well, let's just assume, let's theorize a little bit -

AN HON. MEMBER: (Inaudible).

MR. WINDSOR: Beg your pardon?

SOME HON. MEMBERS: (Inaudible).

MR. WINDSOR: Honest, yes. Very honest. He said: I have ripped you off. He is honest. If we were to assume that Hibernia crude was to eventually come ashore and be processed in Newfoundland so that there was a tremendous drop in the base price of gasoline, then the Minister has still protected himself, he still gets his 13.7 cents per liter. So we do not get the same decrease in the price of gasoline that we should be seeing. But it is amazing when you look at the numbers. Eight dollars and ninety-one cents every time we pull into the pump we are paying in gasoline on a fill up.

SOME HON. MEMBERS: (Inaudible).

MR. WINDSOR: Pardon?

AN HON. MEMBER: (Inaudible).

MR. WINDSOR: Sixty-nine? Fifty-nine in Arnold's Cove. That is the new Come By Chance price. GEO, that is right, the Come By Chance (Inaudible). That is interesting.

AN HON. MEMBER: (Inaudible).

MR. WINDSOR: I would burn more going to Come By Chance, more than $8.91 going, but I will remember to make sure that I arrive in Come By Chance empty from now on.

AN HON. MEMBER: Arnold's Cove.

MR. WINDSOR: In Arnold's Cove. I will arrive in Arnold's Cove empty from now on.

AN HON. MEMBER: (Inaudible).

MR. WINDSOR: That is interesting. At three cents a liter on 65, that is $2 on a tank full of gas, pretty close to it, that you would save by this new Newfoundland company, GEO, which is starting to do very well, I think, and probably should do much better in the marketplace. We should be promoting them as a home-grown company, somewhat. We always used to promote Ultramar because they were refining here in Holyrood. Since they have moved their refinery out I do not think they really qualify now as a Newfoundland company to the same measure. Certainly their Provincial content is far less than it -

AN HON. MEMBER: (Inaudible).

MR. WINDSOR: Pardon?

AN HON. MEMBER: (Inaudible).

MR. WINDSOR: Buy enough in Mount Pearl to get to Arnold's Cove. Well, buy enough in Arnold's Cove to get to Mount Pearl and back to Arnold's Cove again.

Maybe GEO will use the same prices throughout the Province, I do not know. I have not compared their prices in St. John's. Obviously they will have a transportation cost from Arnold's Cove to St. John's and they may well have a slightly higher price. But I compliment GEO and I offer them a word of encouragement. I hope they do well as a primarily Newfoundland company and as a private company against all the multi-nationals.

So there is the story in a nutshell. There is not a great deal more we can say. I am pleased to see that the Minister has protected at least by 1.5 cents per liter Labrador consumers, consumers on the border of Labrador-Quebec communities, because they no doubt could get gasoline much cheaper in Quebec. And the Minister is not doing it, I say - I do not wish to impugn any motives whatsoever - but simply to say that he not doing it for the people of Labrador, he is doing it so that he does not lose that business and the revenue from the people of Labrador, who would buy all their gasoline, as we do that with cigarettes, if I am not mistaken. There is a special exemption for cigarettes, there is a special exemption on taxation and the tourism industry and hotel accommodation, and so forth.

While I am on that, Mr. Chairman, the Minister should think - it gives me an opportunity, and if I have the Minister's attention, to raise a matter that I discussed with some people in his Department last week. I called them just to confirm that what I was thinking was accurate. There are many services - particularly now under the GST - that can be provided equally well either in the Province or out of the Province. And it is an age old problem.

When you get into a fairly expensive wait, then you have a real problem. There are several provinces in Canada, and the Minister may know better than I do at the moment, but I believe Ontario was one. The question came to mind as it relates to, and my friend from Bellevue may be interested, the construction of the accommodation modules for Bull Arm. The contract has gone to a New Brunswick firm. Now that company can build those accommodation modules in New Brunswick and ship them in here. They do not pay sales tax in New Brunswick because they are being exported. Theoretically they are supposed to pay sales tax when they come into Newfoundland, but we have no way to get at most things. Hopefully the Ministers auditors will ensure it.

AN HON. MEMBER: (Inaudible).

MR. WINDSOR: (Inaudible) maybe certain areas, I think it is only off shore. I do not think anything on shore is exempt.

AN HON. MEMBER: (Inaudible).

MR. WINDSOR: Is it exempt, the tax?

AN HON. MEMBER: (Inaudible).

MR. WINDSOR: A 4 per cent reduction.

AN HON. MEMBER: (Inaudible).

MR. WINDSOR: I recall the exact details of that.

I did not mean to get into that debate. The point I am making is that if the module was for a hotel in the Province, a motel or something, they were producing pre-fabricated modules, they could ship them out of New Brunswick without paying sales tax in New Brunswick, and we have no guarantee that we would collect the sales tax here. We can. We can claim it when it is brought in, as we do on automobiles. Anything that is bought outside the Province and brought in, you were supposed to pay tax on.

AN HON. MEMBER: Anything purchased for the Hibernia site is -

MR. WINDSOR: That is the Hibernia site. I am talking about something else, alright? That may well be an exception. I had sort of forgotten that we had given that exemption, and I am not sure exactly what it applies to.

AN HON. MEMBER: (Inaudible).

MR. WINDSOR: Yes, that is right. But if it were a module for a motel or something, that is not part of that project, so there is automatically a 12 per cent disincentive or a penalty for building those modules in Newfoundland. There are other similar examples I could give of large servicing or repair. If you had a piece of technology that you wanted to repair, you know, a very expensive piece of computer equipment that had to be shipped to, let's say, Ontario for repairs or refurbishing, maybe large engines out of vessels or something, or generators for one of our hydro stations if they had to go back to Ontario for repair because of the special technology required or because simply it is such a big item, such an expensive repair item that the shipping is worth it. There is a 12 per cent difference because if it is being repaired in Ontario and shipped outside they can get a rebate on the tax paid on it. They do not pay the tax.

AN HON. MEMBER: Those modules they are building in New Brunswick (inaudible) by charging them the 12 per cent resales tax.

MR. WINDSOR: We could penalize.

AN HON. MEMBER: I do not know.

MR. WINDSOR: We penalize our own companies.

AN HON. MEMBER: Well we should probably look at the legislation and see if we could charge it.

MR. WINDSOR: Unfortunately we cannot because that particular project has no inter-provincial barrier clauses provided in it as well, as I recall. It is not a good example to use for this particular point that I am making, but there are things that can be done in Newfoundland, but that could also economically be shipped elsewhere to be done. Major repairs to a ship, for example, I think that applies.

If we brought vessels into St. John's dockyard or Marystown shipyard we would probably charge sales tax on everything that takes place there but there are other provinces that will not charge sales tax. So there is a direct disadvantage and it can be very significant, 12 per cent, it can be a big chunk of money on a large contract like that.

So I am a little bit off my target, but I took the opportunity to mention it to the Minister, and the Minister may choose to discuss it with some of his officials, because I have discussed it with them. They are aware of the problem, they are not entirely sure of the answer on how to deal with it. We cannot force Ontario or somebody else to charge the tax and, of course, we do not want to give up the taxation ourselves, but we may have to look at some areas where their imposition of sales tax is a direct disincentive to doing business in Newfoundland. I have concerns that the Minister in looking at his Budget for this year, but obviously he did not do that, perhaps next year, is looking at broadening the tax base, basically tying in with GST and imposing retail sales tax on items that are not now taxable, particularly certain services, legal services and engineering services, for example, and I have said here before that were we to do that that is a direct incentive to ship those contracts outside of Newfoundland and Labrador and I think it would be a very, very retrograde step.

So having said all that, Mr. Chairman, I think I have made all of the points that I can make on The Gasoline Tax Act. It is very clear that it is a 5.4 per cent increase. Anyway you look at it, it is a 5.4 per cent increase in the taxes charged on that commodity. It is costing us an extra $1.65, I think it was.

AN HON. MEMBER: $1.69.

MR. WINDSOR: $1.69 every time we fill up as compared to three years ago. Overall it is a 28 per cent increase in taxation, and the Minister has realized a 36 per cent increase in revenue from that source over a three year period. It is very clear, Mr. Chairman, what he has done is protect his revenue and there is no doubt there is good rationale for that, he is doing it at the expense of the consumer of gasoline, and particularly the transportation industry in the Province, Mr. Chairman.

SOME HON. MEMBERS: Hear, hear!

MR. CHAIRMAN: The hon. the Member for Burin - Placentia West.

MR. TOBIN: Mr. Chairman, I would like to say a few words briefly to the bill that is being discussed today by my colleague, the hon. critic for Finance. Mr. Chairman, we can talk I guess or speak in this Assembly until the cows come home as it relates to the mismanagement of the public purse and the financial situation of this Administration. There is no doubt that this Government has the Province set on a course for destruction. There is no doubt in my mind that the course is set to bring this Province to its fiscal knees. All you have to do is listen to the various news media, watch the TV news or read the newspapers, as my colleague for Trinity North is doing right now, and one can only see and hear the doom and gloom that this Government has inflicted upon the people of Newfoundland and Labrador. One can only wish, Mr. Chairman, that the Premier and his Cabinet and his Government would come to their senses, that they would do what needs to be done in terms of bringing some stability to the Province of Newfoundland and Labrador. We know the scam that the Minister of Finance has brought in as it relates to the new system of taxation, the gasoline taxation system. I must say I am a little disappointed in the Minister of Energy in the way that he has handled the situation as well, because the bottom line is that the people of this Province are going to be paying more for gasoline and for other fuels that they need, and the Minister of Energy must accept some responsibility for letting the Minister of Finance being able to implement this the way it is.

What is happening in this Province, Mr. Chairman, and as the Member for Mount Pearl has said so often, this Government has brought the working people of this Province to their knees. The money is not there, people are not spending the money, and the Government in turn are not getting the personal income tax, they are not getting the sales tax, the money is not being spent in this Province. It was only this afternoon that the Minister of Social Services mentioned how I had three trips on a fixed- wing plane to the Burin Peninsula.


MR. TOBIN: Mr. Chairman, I am not sure that it was not even more, when one considers that the people of the Burin Peninsula were working, that it was not necessary to increase this type of gasoline tax when we were in Government. Mr. Speaker, every second day we were on the Burin Peninsula we were announcing the construction of a new hospital, turning the sod for a new hospital, opening a new hospital on the Burin Peninsula in health care. This is the type of travel that is necessary in Burin - Placentia West, to open a new secondary processing plant in Burin, to open a new refit centre in Burin, to announce just before the last election, the expansion of the cow head facility, together with Mr. Crosbie and my colleague for Grand Bank, to announce the expansion of the Cow Head facility, despite the fact that this Government delayed it for over a year. Construction is now, finally, getting underway, and the announcement and the signing that we did in Cow Head in April 1989 has been finalized. That is the type of travel that was necessary to the Burin Peninsula. The opening of the St. Lawrence mines that this Government has since closed, that is the type of travel that was necessary to the Burin Peninsula. And, we can go on Mr. Chairman, we can continue with travel to the Burin Peninsula. Every second day there was someone down there representing the Government, making announcements, opening group homes on the Burin Peninsula that this Government is now trying to close, the opening of group homes for the mentally handicapped, and I am sure, as sure as the Minister of Social Services had to take back water and change his mind in Gander he will have to do it throughout this Province. That is the type of travel we did to the Burin Peninsula, the opening of group homes in Marystown and in Grand Bank. That is why we were travelling to the Burin Peninsula from time to time, Mr. Chairman. The opening of the Cow Head facility, another one. The announced construction of vessels on speculation to keep three, four, five, or six hundred people from the Burin Peninsula employed. The announcement, construction, and the christening of ferries for various places in this Province. The announcement and construction, and the christening of middle distance vessels, that is the type of construction and travel that was necessary. But, Mr. Chairman, sad to say since this Government came to power there is not much need for Ministers to be visiting the Burin Peninsula because all they have done is chopped, closed and sent people to the Mainland. I was speaking to someone today who just came home for a visit. He was home last week for a visit from Toronto and he told me that in the last month the number of Newfoundland license plates in the city of Toronto is unbelievable. He said it is hard to believe the increase in the number of Newfoundland license plates in Toronto, people from Newfoundland going to Toronto. He said one could never believe it when you look at the last election and the promises made by the Premier. As a matter of fact I spoke to someone else, not from my district but from another district, who told me she voted for the Liberals in the last election because the Premier promised to bring her sons home from Toronto. She had five sons living on the Mainland and she was sure the five of them were coming home, and guess where her other two sons are who were home. Guess where they are now? They are on the Mainland. There is no way the Member for Harbour Grace, for example, can go out to his district, as he tried to do last week, and justify the slashing this Government is doing to his constituents, Mr. Chairman. What the Member for Harbour Grace should be doing is standing in this House and condemning this Government for bringing in policies and programs, and for raising the taxes, for implementing additional costs to the people who are using their cars and trucks. That is what the Member for Harbour Grace should be doing, Mr. Chairman. He should be standing in this Legislature and exposing the Premier and his Government for what they are doing to his constituents. Today the Member for LaPoile stood to present a resolution. Mr. Chairman, we do not need debate on that resolution because we support it. I support it and I am sure other colleagues do, the fishermen, but what the Member for LaPoile should be doing was bringing in a resolution commending this Government for closing up a hospital that was only constructed six years ago. That is where courage comes in, that is where representing your constituents comes in, Mr. Chairman, and that is why the Member for LaPoile should get someone to take his picture. He should have a stack of them sitting in this legislature because whenever the Premier gets the courage to issue the writ, the Member for LaPoile will be no more an MHA. The Member for LaPoile will be no more an MHA, Mr. Chairman. And as it relates to the fisheries, I am sure that with the appointment of the new Minister of Fisheries, and with the appointment of a Newfoundlander as Minister of Fisheries, we can expect good things. I firmly believe, Mr. Chairman, that Mr. Crosbie will do will for this Province, and I believe that the opportunity presents itself for him to work well with the present provincial Minister of Fisheries. I believe the Provincial Minister of Fisheries and the Federal Minister of Fisheries could work together. There is only one thing that will cause a negative impact on the fishing industry in this Province, and that is if the Premier decides to take a personal vendetta against Mr. Crosbie. That will not work in the best interest of Newfoundlanders. I must say that once I had a delegation in that met with the Premier, and do you know what the Premier told that delegation, that we have to work to defeat John Crosbie in the next election. That is what the Premier of this Province said about the Federal Minister. Well I think that is a terrible attitude for the Premier of this Province to be getting on with.

AN HON. MEMBER: (Inaudible).

MR. TOBIN: No, Mr. Chairman, I am not. I am asking the Premier to change his mind, to stop getting on and saying that kind of stuff. There is no need of it, Mr. Chairman. I am asking the Premier to change his mind and to stop telling people, to stop telling delegations that his objective is to defeat John Crosbie. It is time that he stopped saying that, and he did not. He said that to the people of Petite Forte. Mr. Chairman, I concur and agree wholeheartedly with the President of Treasury Board, there is no need for it and the Premier should not be saying it, but we have to get on, and I do believe that the Provincial Minister of Fisheries together with the Federal Minister of Fisheries can work in concert for the benefit of the people of this Province and that the Premier, who knows absolutely nothing about the fisheries, Mr. Chairman, should let the Minister of Fisheries handle that department and he stay away from it. I believe that together they could work in the best interests of the people of this Province. There are other issues that we have to address here.

AN HON. MEMBER: What other issues?

MR. TOBIN: Maybe the Premier should concern the defeating of the Member for Carbonear and others throughout this Province, but I honestly believe that this Government is on a course of economic and social destruction for the people of the Province. Today's -

MR. CHAIRMAN: Order please!

The hon. Member's time has elapsed.

The hon. the Member for Green Bay.

MR. HEWLETT: Thank you, Mr. Chairman.

Mr. Chairman, perhaps it is ironic, I was a bit late arriving today so I missed the Ministerial statement by the hon. Minister of Justice regarding Consumer Awareness Week. This particular tax bill we are dealing with, Mr. Chairman, is sort of flying in the face of a well informed general consuming public. The Minister of Justice indicates that people would do well to be very aware and very informed consumers because there are all kinds of entrapments waiting for them out there in our society in general in order to do them in. What the hon. Minister of Justice refused or probably forgot to mention is that the consumer has one entrapment that he would do very well to be aware of, and that is the current Wells Administration and the current budgetary machinations of the hon. the Minister of Finance.

I was standing in this Chamber in the fall sitting I think it was, when things were heating up in the Persian Gulf, and due to market-driven, panic-stricken economic factors the price of oil and gasoline, etc., started to jump tremendously. And I remember questioning I do believe, both my colleague the Minister of Energy and the Minister of Finance with regard to the possibility of freezing the percentage tax, the ad valorem tax which is a percentage as the prices continued to soar. Government at the time indicated it was monitoring the situation and muttered a few other words of solace for consumers who were seeing their gas prices go through the roof, but effectively did nothing.

Then, once the initial panic as a result of the Gulf crisis sort of cooled down a bit, oil prices started to drop off. Then all of a sudden we get an announcement in the Budget Speech saying, Whoops! We have changed our minds and we have decided now to go with a fixed cent per litre charge on gasoline unlike when the prices were rising, where we were taking in a percentage. Now that they are dropping, we do not think a percentage is in line any more. We could rob them on the way up but we cannot rob them on the way down, so we had better put a stop to this right away, Mr. Chairman, is the attitude of this Government. So, of course, very near the peak of gasoline prices they froze their cents per litre and now as the prices of gasoline continue to drop, it is the consumer who is going to pay extra across this Province.

Mr. Chairman, apart from those who have been personally hurt by this Administration because they have been fired or some public service provided by the Provincial Government to them has been reduced or cut, I think it is safe to say that so far dealing with the Wells' Administration has been a taxing experience, and I mean that both literally and figuratively, Mr. Chairman. There have been income tax increases since this Government came to power, there has been the payroll tax, a guarantee fee put on Newfoundland Hydro, an existing subsidy to Newfoundland Hydro eliminated, all of which gets transferred to the consumers. It is all ending up one way or the other as extra tax coming out of the consumer or less services being given to the consumer, in most cases both, along with a significant lay off of Provincial Government jobs which in rural areas are quite often a stabilizer in the economy.

The Budget Speech by the Minister of Finance also makes reference to the fact that they are going to look further later in this fiscal year at harmonizing their tax system with the Federal GST system. We have seen since this Minister came to office because of budgetary measures a 25 per cent increase in the rate of electricity in the first year or so of this Administration. We will continue to see an even greater rise; probably we will end up with 35 per cent increase before long if this Government decides to expand its tax base and include electricity.

Mr. Chairman, this Government got elected on the notion that it was going to lower taxes, increase services, and create employment. The school tax was going to be abolished. No matter what the fine print on the Liberal literature was, the candidates going door to door and doing their interviews with the press, in the media, when they were in the public meeting halls throughout their Districts, they said, `we are going to abolish the school tax'.

AN HON. MEMBER: Not true.

MR. HEWLETT: The greatest evil ever set upon mankind is the school tax. Mr. Chairman, the ladies and gentlemen in each hall who were told such a thing found out since they were deceived, that the school tax is still here and it has been increased, the taxes on their electricity are going through the roof, their income taxes are going up, what subsidies were provided to public services to make their life easier have been eliminated. This indeed has been a very taxing Government to live with, Mr. Chairman, in all aspects of that particular word.

This Government got elected on a social program to do better for the people of Newfoundland, and so far all we have heard is tax harmonization, service rationalization, which all boils down to more taxes, less services, less jobs. Now the latest thing in the paper on the weekend, Mr. Chairman, is a county system of government. Well, with no due disrespect to my colleague for Grand Falls or the Minister from Windsor, it would appear already that Green Bay has tasted the county system of government, because our county hospital is now located in the Town of Grand Falls - Windsor. Our court house is still open in Springdale. But the magistrate has retired so the court in Springdale is serviced on circuit out of the county courthouse in Grand Falls - Windsor. Mr. Chairman, what we are seeing is a downgrading of the number of the public servants and public service wages available to the economy of Green Bay and a consolidation of Government services in a number of regional centres around the Province.

This is going to hurt very deeply the outlying districts. The plumb in any county system of Government, of course, is which community within the entire county gets to be what the Americans call the country seat. I have a funny feeling that neither of the towns in Green Bay, including the largest one, Springdale, would end up being the country seat for the area I represent. Trends to date indicate that probably the large amalgamated town of Grand Falls - Windsor would end up being the county seat for my area of the Province. Mr. Chairman, we pay more taxes, we get less services, we have less people on the public payroll, which in a global sense to some people might make sense, but to the economy of my island, my island is in Green Bay, my district in general, where the fishery is in decline, we have just about cut ourselves out of house and home when it comes to trees, we have not opened a mine since I was a teenager, Government employment is key to the survival of my district and Government, Mr. Chairman, is shrinking in my district, shrinking considerably, while at the same time it is removing existing subsidies that people were used to and increasing taxes.

As I indicated, this particular Bill was robbing them on the way up with the price of gasoline, and once they saw the price of gasoline was dropping, they decided to freeze it and rob them on the way down. Mr. Chairman, you cannot win with this crowd, they get you going up and they get you going down. As I indicated, dealing with the Wells' administration is being an extremely taxing experience. I thank you, Mr. Chairman.

MR. CHAIRMAN: The hon. the Minister of Social Services.

MR. EFFORD: Thank you, Mr. Chairman. I wanted to take a couple of minutes to respond to the Member for Burin - Placentia West, but after listening to the Member for Green Bay I think it is important for someone on this side of the House to try to respond to some of the silly accusations he was making about taxes and about his district, about what should happen and that Government should get involved. I do not know how the hon. Member expects Government to provide services, social programs, health programs, education programs, services or infrastructure to his district without collecting taxes.

MR. HEWLETT: You are collecting the amount of taxes and cutting the amount of services. That is my point.

MR. EFFORD: I am not the greatest listener in the world but I think I would be interested in sitting down with the hon. Member if he could tell me how we can spend all this money on the programs and not collect taxes. I do not have much patience with that particular individual but I would try to have some patience for an hour or two and listen to his ideas.

MR. HEWLETT: You are increasing taxes and decreasing services.

MR. EFFORD: Looking at their administration over the last seventeen years I know their greatest concern was not in paying debts but in incurring debts. There is no doubt about that. Surely the hon. Member knows full well that you cannot keep going in debt year after year, decade after decade and have no accountability. Is that the way you operate a Government? Is that the way you operate a system? He made it quite clear that this Government had intended to do something different. Yes, we have intended to do something different. We have certainly been trying to do something different, but the first thing we have to do is try to straighten out the mess he and the former administration left behind. If you buy a business that is bankrupt you do not continue on bankrupting that business and putting it further and further in debt. First of all you try to make the business accountable for its own expenses and its own operation, and the only way you can do that is by creating an income. And if the income is not there, Mr. Chairman, then the debt is going to increase further and further and the end result is no Government, no services, no business, no system whatsoever.

I was quite interested in listening to what the Member for Burin - Placentia West had to say. It is too bad he is not in the House of Assembly, but I am sure he is in the back room listening. He talked about renting and flying to and from the Burin Peninsula making some positive announcements. I have no difficulty understanding that when you go to your district you should make positive announcements and you should be there when announcements are made, no matter when. But I do not understand why the then Minister of Social Services would rent a fixed-wing aircraft to fly from St. John's to Deer Lake, to fly back to St. John's and to fly to Winterland. Now I presume the Winterland airport is on the Burin Peninsula. Four times in the period of one or two months the Minister of Social Services flew from St. John's to Deer Lake, to Corner Brook, back to St. John's, and up to Winterland airport. If they made those four announcements in one month, they were making some fantastic announcements. And I do not know why you would have to rent or charter a fixed-wing aircraft. Those are the same hon. people who put a question before the House of Assembly asking me to table the number of trips I had made as Minister of Social Services during the year 1990. I made one trip out of the Province in 1990. He rented a fixed-wing aircraft for four trips within the Province and he went outside the Province on nine occasions.


MR. EFFORD: On one occasion he flew to Europe for a seven-day visit, to find out the impact of an oil development on a province or on a district.

MR. GOVER: And he did not find that out.

MR. EFFORD: I have searched the department inside-out, up-and-down and I cannot find one word I could read as to what the study was, or what report he made when he came back. I suspect his trip to Norway was a highfalutin vacation for him and his officials, probably his executive assistant, or whoever went with him. That is the kind of hypocrisy you get now when they start talking about how much money is wasted on this side of the House of Assembly. What would it cost to rent a fixed-wing aircraft to go from St. John's to Deer Lake, back to St. John's and up to Winterland?

AN HON. MEMBER: A lot of money.

MR. EFFORD: A lot of money, probably as much as $500 - $600 an hour. I suspect more than that. A helicopter, I think, costs around $600 - $800 an hour. The hon. the Member for Torngat Mountains knows full well what it costs.

AN HON. MEMBER: (Inaudible).

MR. EFFORD: That is a helicopter. So to Deer Lake back to St. John's and up to Winterland, you are talking about $10,000 to $15,000 for the four trips.

The middle distance fleet - I was surprised they brought up about the middle distance fleet and the prosperity it brought to the Burin Peninsula. The middle distance fleet cost the taxpayers of this Province somewhere in the vicinity of $40 million.


MR. EFFORD: Somewhere in the vicinity of $40 million, with no return to the Province whatsoever. Now if we took just the two or three things I have mentioned in the last few minutes and gave the money back to the taxpayers of the Province, you would not have to increase taxes or charge as much taxes as we pay. Now multiply that by the thousands of things this former administration have done and we would not have a $5.8 billion debt in this Province today. Now that is the problem, Mr. Chairman, a $5.8 billion debt.

Now I extend an invitation to the hon. the Member for Green Bay or any financial expert on the other side to come over and sit down with the Minister of Finance and tell him how he is going to pay the interest on that loan, pay for all the social, education and health programmes and other services needed in the Province without collecting taxes.

So the challenge goes out, Mr. Chairman, to any Member on the opposite side, and I will gladly be able to spend the time, in fact, I will take as long as it is necessary and we will be able to then go with the (inaudible) no taxes, lots of service and no taxes.

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

MR. RIDEOUT: Thank you, Mr. Chairman.

Mr. Chairman, I just want to have a few words on this particular bill before the House deals with it as it will eventually. I am not interested, Mr. Chairman, in reiterating anything that has been said already. I mean everyone knows what this Bill is about. This Bill freezes the tax on gasoline at a high point when the price of gasoline is high. It freezes the tax on gasoline and keeps it there even though the price on gasoline has since fallen and the Minister of Finance, as I understand it, made no bones about that in his introduction. The purpose of this Bill is to maintain the highest possible levels of income from gasoline tax to the Province. That is what this Bill is all about. The Minister of Finance has said it and therefore there is nothing we can do about it but point out to the people of this Province as we have done, and as we are doing again this afternoon, that the Government had a choice. The Government could have maintained the ad valorem system that was in place which gave the Government higher revenues as gasoline prices went up but gave the consumer a break and the Government lower revenues as the price of gasoline went down. Now that is what ad valorem meant, Mr. Chairman. It gave the Government additional increased revenues on the upswing when prices were going up, and it gave the Government less revenue and therefore the consumer a break when the price of gasoline was on a downswing. It is just as simple as that. There is no more to it than that except that this Government, predicting and expecting what would happen after the end of hostilities in the Persian Gulf, this Government predicted and anticipated that gasoline prices would stabilized or perhaps, in effect, go down, which is what has happened. The price of gasoline since the ceasing of hostilities in the Persian Gulf has gone down.

AN HON. MEMBER: (Inaudible).

MR. RIDEOUT: Mr. Chairman, is the -

MR. SIMMS: (Inaudible) lower the taxes.

AN HON. MEMBER: (Inaudible).

AN HON. MEMBER: Do you remember that? Do you remember saying why won't the Minister (inaudible).

MR. RIDEOUT: The Minister of Health is having hallucinations and that is not surprising with what he has done with the health care system of this Province. So the Minister would best keep quiet while somebody else is speaking. If he has a point, let him get up and make it as he is entitled to do.

So, Mr. Chairman, this is not two faced, this is telling the House what has happened. The Government made a decision knowing full well that the price of gasoline was going to take a slide over a period of time that it wanted to keep the revenues high. The Minister of Finance said that today. This was a measure to keep the Governments revenues high, and he said that we did it deliberately. That is all we are doing, reiterating what the Government policy is, and that is what we are here for, Mr. Chairman, to point it out. If the Minister of Health has a point to make that is different, he has every right to make it, and I would suspect, Mr. Chairman, that if he keeps it relevant and if he keeps it to the Bill that we are dealing with he might even get to make it without being interrupted because most of us on this side of the House are one heck of a lot more courteous than the Minister is.

MR. SIMMS: Hear, hear! Now put that in your pipe.

AN HON. MEMBER: (Inaudible).

MR. RIDEOUT: See. Here he goes again. For the Minister's information I was out and had one and have no reason to be touchy. You can bring the hob nailed boot into this place, but you cannot stop some of us from going outside if we want to.

Mr. Chairman, I want to make a few comments before my ten minutes are up directed to the Minister of Social Services who just made another tremendous contribution to the debate in this House. The Minister of Social Services is his own worst enemy.


MR. RIDEOUT: He can 'Ha' all he likes, but the Minister of Social Services is his own worst enemy. The Minister of Social Services has not realized yet, Mr. Speaker, that he is not in Opposition anymore. The Minister would do well for his own credibility and for the credibility of the Government to realize that he is no longer a Member of the Opposition. It is time for the Minister of Social Services to get up out of the gutter where he is comfortable, and become more of a cosmopolitan politician. The Minister, Mr. Chairman, -

MR. EFFORD: (Inaudible).

MR. RIDEOUT: Mr. Chairman, there is an example. I can almost sit down and say the Minister has proven my case for me. The Minister of Social Services, as soon as there is any allegation made about the Government or the Minister he gets up and he goes back in recent history and he tries to dig out something that might embarrass somebody on this side of the House.

MR. SIMMS: Try to deflect.

MR. RIDEOUT: Mr. Chairman, that is immaterial, we are not the Government any more.

MR. SIMMS: We paid for that.

MR. RIDEOUT: Mr. Chairman, if there is a price to be paid, we paid it. What does he think he is going to gain?

MR. SIMMS: Now he is trying to deflect criticism away from himself that is all.

MR. RIDEOUT: Absolutely! And, Mr. Chairman, everybody is talking about him.

MR. SIMMS: Everybody.

MR. RIDEOUT: Everybody is talking about the nonsense and the foolishness that the Minister gets on with whenever there is a question he does not like. Whenever there is an allegation made by somebody inside or outside the House that he does not like, he gets on with this stuff that happened years ago. Let me tell the Minister: I could have, when I was Minister of Fisheries, when the person who is now the Minister of Fisheries was asking me questions in the House that I might not have liked for personal or political reasons, I could have gone over to the Department and said: give me the expense claims for the former Minister of Fisheries, the Member for Twillingate, when he was Minister between 1975 and 1979, give them to me, go out in the Registry and go down in the bowels of Confederation Building and find them. Let me see what kind of spender he was when he was a Tory Minister of Fisheries, and I could bring it over to the House and I could slap it across the House and give him a poke in the face with it and stuff like that. Now what would that have proven? It would have proven -

AN HON. MEMBER: (Inaudible).

MR. RIDEOUT: I will come to that in a minutes.

MR. EFFORD: Twenty thousand dollars worth of cigarettes.

MR. RIDEOUT: See! It would have proven that I was a more incompetent twit than the person who was asking the questions. That is what it would have proven, that I was a more - that is what it would have proven like that Minister is proving today and every other time that he gets up with this stuff about somebody renting aircraft or somebody ordering booze or somebody ordering something else. He is proving himself to be an incompetent twit, Mr. Chairman.

MR. SIMMS: An hon. twit.

MR. RIDEOUT: That is what he is proving himself to be.

SOME HON. MEMBERS: Hear, hear!

MR. SIMMS: Right on!

MR. RIDEOUT: And that is why he is always in trouble. And that is why he is going to continue to be in trouble, Mr. Chairman.

MR. SIMMS: He will never learn.

MR. RIDEOUT: I could have done that. I had an opportunity dozens of times to do it with my colleague, my friend for Twillingate, I could have hauled out his expense claims, I could have paraded them around the House. I could have sent them off to the papers, Mr. Chairman, and say compare this to what I am doing, compare that to what somebody else is doing. But what would it have proven? It would have proven that I have no more intelligence, it would have proven that I was just as immature as the person who occupies the Office of Minister of Social Services today.

MR. SIMMS: Hear, hear! Right on!

MR. RIDEOUT: That is what it would have proven, Mr. Chairman. That is a foolish silly game to play.

MR. EFFORD: (Inaudible).

MR. RIDEOUT: And you know what: the only person who will lose on that is the person who is trying to perpetrate it on this House and on the public of Newfoundland and Labrador. That is the only person who will lose. So I say to the Minister keep it up. Go ahead with it.

MR. SIMMS: Every time he opens his mouth -

MR. RIDEOUT: You know, I said a moment ago that the Minister did not know he had left Opposition, that is his problem.


MR. RIDEOUT: Well he used to do that stuff when he was in Opposition.

MR. SIMMS: That is right. Always.

MR. RIDEOUT: Here he is now saying: talk about the $20,000 that you spent on this, that you spent on this, or the $5,000 that you spent on this. This is what he did in the House the other day. This is what he was so good at when he was a critic in Opposition. He would get up in a dishonest way, make a statement, have it carried as fact, then when somebody else denied it, he said: Oh, my god, I am sorry. But the damage was done. It was out there. And he is a master at it, Mr. Chairman.

MR. SIMMS: It is time he got the rocks off his back.

MR. RIDEOUT: He was a master at it in Opposition and he is carrying on today in Government and has been for the last two years in the same way. But, Mr. -

MR. EFFORD: (Inaudible).

MR. RIDEOUT: How could I what?

MR. EFFORD: $20,000 worth of liquor -

MR. RIDEOUT: Yes, what about it?

MR. SIMMS: Spent?

MR. RIDEOUT: Yes, how about it? A standing order for liquor for the Premier's dining room for various Committees of Cabinet, for various Government use, a standing order for $20,000 for one full year. How much of it was used?

MR. SIMMS: For one year?

MR. RIDEOUT: For one year.

MR. SIMMS: How much was used?

MR. RIDEOUT: How much was used? There is where the Member is being dishonest you see, Mr. Chairman. There is where the Member has not got out of Opposition yet. There is where he gets out something and tries to make a lie a fact. That is where he tries to make deception the truth. That is where he tries, Mr. Chairman, to take advantage of this House and perpetrate lies and deception on the people of Newfoundland and Labrador. I say carry on my son, the more you do it the better, because I heard so much of it outside the overpass this weekend, and I was out there from Thursday until Saturday, I heard so much of it. Do you know what, our telephones are going again today. Everybody in this Province that this hon. gentlemen has not catered to is now on his back and are coming to us, so you keep it up, you keep it up. The other day I said the Minister was a loose cannon on the ship of state in this Province, and he is. He is, Mr. Chairman, and I hope he keeps it up, I hope he does not back off on it, because as sure as I am standing here somebody out there in Newfoundland and Labrador has the goods on that Minister. They have the good on him, and as long as he keeps up the way he is going now, and if he keeps it up long enough, he is going to brown off somebody, or turn off somebody else enough, that they are going to start squealing, other people are going to start squealing.


MR. RIDEOUT: Mr. Chairman, has anybody got anything to give the hon. gentleman to calm him down? He can get up and give it. You are a prime example of somebody who can take it alright. He reacts like a caged coyote. Take it out to the bathroom with you. That is how valid that piece of paper is you have in your hand. Two can play this game. I could have played this game on the former Minister of Fisheries if I wanted to, but no, Mr. Chairman, some people in this House have a bit of common sense, some people have a bit of integrity, some people have a bit of maturity, but every time the Minister over there gets on his feet he proves he has none of that and the people of Newfoundland and Labrador are seeing it now, day after day, and eventually the Premier will see it. I have one request to make to the Minister, do not give it up, do not back down, keep it up, the more the merrier, because the more you do it the more your credibility hits the bottom of the barrel.

SOME HON. MEMBERS: Hear, hear!

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

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

I am pleased to have the opportunity to speak on this Bill, Bill 15, An Act To Amend The Gasoline Tax Act, 1978.

MR. EFFORD: Now, we will hear something sensible.

MR. A. SNOW: I am not sure if the Minister of Social Services personal endorsement is a credit or not.

MR. EFFORD: They say you have more money than I got.

MR. A. SNOW: Oh, I definitely would not say that.

Anyway, Mr. Chairman, in speaking to this Bill we recognize that the Minister of Finance has suggested that the single purpose of this Bill is to stabilize and increase revenues coming from the consumption of gasoline in this Province. As my Leader has suggested earlier this is a tax grab, it is a tax grab at its highest point in percentage of taxes gasoline will probably reach. The hon. Minister of Health questioned the Leader of the Opposition earlier about how come the Opposition suggested that this tax be fixed back several months ago. Yes, that is a point and the Opposition did suggest that the ad valorem tax be lowered, or fixed at that particular time, because at that time the price of gasoline and oil in a global sense was taking right off and the suggestion from this side was that it would be a protection to the consumer if you were indeed to fix the tax at that stage. Oil, I believe, at that time was somewhere around twenty-four or twenty-five dollars and then all of a sudden it took right off and got up to, I believe ultimately to thirty-five. Anyway, Mr. Chairman, that was a suggestion at that time from the Opposition so that the price of gasoline would indeed be lower in comparison to other provinces.

And the Minister of Finance earlier suggested that they needed the revenues and so did the Minister of Social Services, suggested that how can the Opposition stand up on this side of the House and say that: look, you are fixing the tax too high, we need the revenue, and yet you are saying increase the services and lower taxes. Well, I suppose, Mr. Chairman, in the fact that I have had some experience in the private sector that I recognize that you do not necessarily always get more revenue just because you increase the price of something.

I happen to live in a border community, and prices in our area can quite often be affected by the prices in another part of the country, another province, the Province of Quebec. As I suggested earlier, businesses and my experience in the business community has shown me that quite often just because you increase the price of a commodity it does not necessarily mean that you are going to increase the revenue. A simple example I guess would be the supermarket which places on sale what is commonly referred to as a 'lost leader.' They may place bread or milk or some other commodity on sale to attract consumers into their store and then those consumers, because they are in the store, will turn around and purchase more goods within the store.

Now that happens quite often. We are seeing in the Province of Quebec a similar type of regulation or taxation to influence the consumers to spend more. In the Province of Quebec they have a variation of taxes on gasoline - to the best of my knowledge they do - because what they want to do is attract consumers. This is in border areas now they are talking about, because they border on the Province of Ontario and they have a lower tax than the whole Province of Quebec does. So what they do in the border areas, close to the border in Ontario, is lower the provincial sales tax. The provincial collected taxes on gasoline in the Province of Quebec is lower. And the idea is to make it more competitive. By lowering it in Quebec and bringing it down to a closer cost per liter to the consumer consumers will be attracted to stay in the Province of Quebec and purchase more goods, gasoline or services from a garage.

In my area, I live next to the Province of Quebec, and their gasoline tax right now is seven cents a liter lower than it is in Labrador City and Wabush. Now I am suggesting that if this Province were to allow the gasoline taxes to be lower per liter in western Labrador, that indeed, like the supermarket, like the grocer who puts the 'lost leader' on sale, the people of this Province will realize a greater revenue, because residents in western Labrador, which is the predominant population if you will in numbers, will stay in Labrador City and buy gas.

Because what is happening now, that is influencing people to travel from Labrador City and Wabush up to Fermont and purchase their gasoline. And of course we all know that as the supermarket puts its 'lost leader' up, when that consumer came in the store he was attracted and purchased other items. Now that is what is happening in the Province of Quebec. Consumers are leaving Labrador City and Wabush, driving up to Fermont, purchasing gas and at the same time they are up there they are then going out and purchasing more goods and services in that province. So rather than revenue accruing that should be accruing to this Province in sales tax, as personal income tax - because what is happening, of course, is that if the local consumption of goods drops because we are spending the money over in Quebec, the supermarkets, clothing and hardware stores are going to be selling the goods over in Quebec, rather than the ones in this Province. So the sales will be down in our Province and the employers in western Labrador will quite possibly have to lay off people there.

Now there has been a recognition by the previous administration with the concept of lowering taxes so as to give an advantage, or at least a level playing field, with their neighbour across the street, with their competitor across the street, and that is in the sales tax on hotel rooms is not being charged in the southern Labrador area, in L'Anse-au-Clair versus Blanc Sablon. They do not have a sales tax on hotel rooms in Quebec.

The previous administration recognized that it was an unfair advantage, so they gave an exemption to the hotel operators in L'Anse au Clair, that they would not have to charge or collect the 12 per cent sales tax. This gave a level playing field. So, there has been a recognition by the previous administration, and an acceptance of it by this administration has confirmed, yes, they agree with it. Unfortunately, I could not convince - I was going to say this bunch - this group of individuals who had previously been governing this Province, to implement a similar programme in western Labrador - they did not. But one thing I did convince them of, was the removal of sales tax on clothing in Western Labrador, for the exact, same reasoning, Mr. Chairman.

I point out these things, because I want people opposite to recognize that they have done this before, that there is a precedent. So, I am not attempting to re-invent a wheel, I am merely attempting to establish that it should be done again, it should be continued. As a matter of fact, in this bill, there is a recognition of a difference, in Clause 3, Section 3.(2). They recognize there the difference in the price of gasoline in the southern section of Labrador, in the L'Anse au Clair, Blanc Sablon area of the coast.

So, there is a recognition, but I submit to you, Mr. Chairman, the problem was, when this came up - this Act was passed in 1978 - that was the border then, between Quebec and Labrador. We could not then, from Western Labrador, drive to the Province of Quebec, so you did not have the problem of attempting to try to make that level playing field; you did not have to adjust the sales tax or the tax on gasoline in this Province versus the Province of Quebec to make them more equal.

Mr. Chairman, at the appropriate time, I will be moving an amendment to this bill to allow the Government the opportunity of making a level playing field in the border areas of this Province, and those two areas are southern Labrador, Blanc Sablon-L'Anse au Clair, and western Labrador, the Labrador City-Wabush area and the Fermont area in the Province of Quebec.

I suggest to you that this Province, while it should lower the revenues per litre on gasoline, the actual revenues, in total - in total - will be greater by doing this; because you will be operating in a similar manner to the way the supermarket operates when he gives what is commonly referred to as a lost leader.

So, at the appropriate time, I would ask that my amendment be accepted. I have had discussions with the Minister of Finance on this, and my understanding is that it is quite in order to do it; you should be able to do it. In my understanding, the Province of Quebec has a higher tax rate than we do - of course, we have a higher tax rate than the Province of Quebec on gasoline.

So, there should not be any problem, as long as you believe in the principle. If you have another motive, you can do it, but if you believe in the principle of making a level playing field, to allow businesses to have the opportunity of competing on a level playing field, if you believe in that, then, you will support and vote for the amendment; because, if you really believe in it, you will then give to people selling gasoline in the western Labrador region of this Province the same opportunity as the person selling gasoline in the Province of Quebec.

I notice the hon. the Minister of Works, Services and Transportation is over there shaking his head in a negative manner. He does not agree with this. Mr. Chairman, I do believe in it, as do a lot of people on this side of the House. And I am sure a lot of people on the Government side of the House also agree with that principle.

I think you just cannot look at it in simplistic terms of because you charge more per litre you are going to get more money. It does not work like that all the time. The hon. the Member for Pleasantville knows that it does not always apply that if you double the price of shoes you are going to make twice as much money.

MR. CHAIRMAN: Order, please! The hon. Member's time is up.

MR. A. SNOW: Thank you very much.

AN HON. MEMBER: By leave! By leave!

MR. CHAIRMAN: The hon. the Member for Torngat Mountains.

SOME HON. MEMBERS: Hear, hear!

MR. WARREN: Thank you very much, Mr. Chairman. I will only be a few minutes, Mr. Chairman.


MR. CHAIRMAN: Order, please! Order, please!

MR. WARREN: Mr. Chairman, I am only going to take a few minutes, but I want to bring something very important to Members of this Legislature about this particular bill. I would hope that the Minister of Finance would listen for a few minutes because there is a group of people in this Province who will suffer the most from this bill until the opening up of navigation, and I think the Minister of Finance should take this into consideration before this bill becomes law, and I say this in particular with respect to the people from Lodge Bay to Nain on the Labrador coast.

Mr. Chairman, the last fuel delivered to coastal Labrador took place some time last November or December when the prices of gasoline and fuel oil were at the highest peak. Mr. Chairman, since then I understand, and I stand to be corrected, but the cost of gasoline, I understand today at the pumps here and around St. John's is around sixty-two to sixty-four cents per litre. On the Labrador coast, from Lodge Bay to Nain the cost of gasoline is the same as it was last November and it will be the same until a new shipment arrives in probably July or August and that is something like eighty to eighty-five cents a litre. Mr. Chairman, when you see a difference of twenty to thirty cents a litre, the people who are receiving, on the average, the lowest income in the Province are paying the highest price for fuel, number one, because of the Persian Gulf crisis, that is part of it, but you cannot deliver any fresh fuel into those areas now, and this bill is really going to cause - because the price is not going down, the price has not reduced and the companies will not reduce it.

So I would suggest to the Minister and I say to the Minister of Mines and Energy, who a few weeks ago announced that he was going to do a review of the fuel prices in Happy Valley - Goose Bay, Happy Valley - Goose Bay is still eight, nine, to twelve cents below the price on the coast. I say to this Government the least thing this Government can do, and I say to my hon. colleague, the Minister of Mines and Energy, why not bring in a formula between now and the opening up of navigation that will lessen the burden on the consumers from Lodge Bay to Nain, whom again through no fault of their own, are paying as high as eighty to eighty-five cents for a litre of gasoline. I would suggest strongly that serious consideration be given to those people for the next three to four months until the new shipment of fuel comes in, and by then you will see a reduction in the fuel prices of probably ten or twelve or fourteen cents a liter.

I am surprised that this bill has been debated today and that my colleague for Eagle River has not taken the opportunity to stand up and speak on behalf of the people from Lodge Bay to Cartwright at least, Lodge Bay to Paradise River at least, which he was elected to do, knowing that they have been requesting a reduction in the fuel prices.

So I say that I believe, and I say to the Minister of Finance, at least look seriously at a provision, that you can see a reduction in the next two or three months until the opening of navigation to offset the high cost that those people from Lodge Bay to Nain have to pay for fuel prices to heat their home, and also for gasoline prices - not to run their cars and trucks, not this time of year, but to run their skidoos to get wood and food for their families. Because the skidoo on the Labrador coast this time of year is as important as a car or truck is to the Member for Placentia or to the Member for Port aux Basques or to any Member on this side.

So I suggest to the Minister, look at this seriously and I would think that the people on the coast of Labrador would welcome the comments and the good news from the good doctor, the Minister of Finance.

Thank you very much, Mr. Chairman.

MR. CHAIRMAN: The hon. the Minister of Finance.

DR. KITCHEN: Yes, I just want to make a point or two on this bill. A number of points have been raised.

It was pointed out that we are going to increase the amount of revenue over and above what our revised figures said last year by something like $11 million, and that some Member made a fairly passionate speech - I think it was the Member for Green Bay - that we should not do that. The alternative is perhaps - every million dollars means about forty jobs. We could I suppose not do that. Had we not improved our revenue position by $11.7 million we could have laid off another 450 people, I suppose. You see, you cannot propose not to do something without giving an alternative. And that is part of the problem we are in. Sure, we could lower the gasoline tax, but the price is that we have to protect our bottom line, and that would mean that we would have to cut costs in other ways or raise other taxes. And basically that is the point.

Another point - and it may or may not be fully legitimate - is the one raised by the Member for Menihek and supported by the Member for Torngat Mountains, that we should look at the differences in the price of gas in Quebec and Labrador, and that representation has already been made to me when I visited the Straits of Labrador recently and people were telling me about the problems they had on that particular point.

However, that is not the whole story. Because when you make comparisons between provinces on taxes you just cannot compare one tax with the other. You have to compare the whole regime of taxes with the whole regime of taxes of another. And we find, for example, that our average tax rate in Newfoundland is about the Canadian average. Alright? And in Quebec for example their payroll tax is over 3 per cent, and ours is 1.5 per cent with exemptions for small businesses. Their tax for schools and municipalities is much higher than ours. And so we would have to take all that into account.

But I will undertake to do this: because the point has been raised by the two Members opposite and by the Member for Eagle River privately, as we visited his area last week and people from the district made the point, and he has made the point, that we will certainly look at this whole question of Labrador taxes versus Quebec taxes so that we can bring some equity into it. I do not think the time is here now to do it in this bill but we have in our minds to bring in a tax reform package either next fall or later and we will consider it for then. So I will give that undertaking that we will consider it for that point. And I think it is a fair point that you have made, and I thank you very much, the Members who made these points.

SOME HON. MEMBERS: Hear, hear!

DR. KITCHEN: The Member for Mount Pearl was raising the question of, what happens if somebody builds something in New Brunswick, say a module, either for Hibernia or for some other reason, and brings it into Newfoundland. Will they escape Newfoundland tax? And the answer is no. If the Hibernia modules and things that are built outside - whether they are built outside or inside there is no tax on the capitalization for the Hibernia material. There is 4 per cent on operating but they are capitalizing most of their operating anyway and so that would not affect it. Whether it is built in New Brunswick or in Newfoundland there is no tax for that part.

But now what about non-Hibernia? Anyone who builds a house, a pre-fab house, and brings it into the Province gets taxed. There was even recently a church that was pre-fabricated in another province and they brought it into the Province and thought to avoid tax, and we got after them, they had to pay the tax there. And the same applies to businesses. Anything that is built in another province and brought in for consumption in the Province is taxable. And if a motor is brought away to be repaired and it comes back into the Province, that is taxable. I have checked it out with our people.

So there is no way that they can avoid this very careful and assiduous tax department of the Department of Finance. Wherever there is a way of getting tax from a person we would get it. And we have tax collectors now that go off to Toronto, and they go off to Quebec and Winnipeg, wherever there is a fairly large account that will pay their transportation and get us a bit more money, we will send them there to look at the books, and they rake in a fair amount of money from people who would normally not be paying tax. But if there is, and I am sure there is still considerable tax avoidance, but wherever it is brought to our attention, we will get after it. If anybody knows of any I would certainly be delighted because that would mean that we might be able to lower the rate if we can catch more of these tax evaders and do us all a favour.

We are not very happy about the taxes we have on gasoline in the Province. They are the highest in the country, and what I would like would be to reduce these, but this particular year we cannot do that. Thank you, Mr. Chairman.

MR. CHAIRMAN: Is the House ready for the questions? Shall the resolution carry? All those in favour please say 'aye'.


MR. CHAIRMAN: All those against the resolution please say 'nay'.


MR. CHAIRMAN: Shall clause one carry?


MR. CHAIRMAN: Carried. Shall clause two carry?

AN HON. MEMBER: No, Mr. Chairman.

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

MR. A. SNOW: I move an amendment, Mr. Chairman, that clause two be amended by adding the following as section (3)1-1: Clause one - notwithstanding subsection one, gasoline sold by retailers in and for consumption in the following areas in the Province shall be subject to the tax on gasoline at the rate prescribed by the Minister consistent with the rate of tax set in the adjoining Province, part A: the town of Labrador City, part B: the town of Wabush, part C: the coastal area of southern Labrador extending from the boarder with the Province of Quebec to and including the community of Red Bay.

SOME HON. MEMBERS: Hear, hear!

MR. A. SNOW: Mr. Speaker, speaking in support of that amendment, as I briefly outlined, this amendment will allow the Minister of Finance to level the playing field so that business operators in the sale of gasoline would be able to sell their product on a level playing field with their competitors in their adjoining border communities. Mr. Chairman, the Minister of Finance suggested that we have to be concerned with revenues collected, and if we lose $1 million we have to look at the alternative, which is we may have to lay off of forty more people. I sincerely believe that we will collect more revenues in this Province from western Labrador which produces more revenue than any other electoral district in this Province, we will collect even more revenues from western Labrador by lowering the gasoline tax in western Labrador because more people will stay home and buy at home because it is more competitive.

MR. CHAIRMAN: Order, please!

I wonder if the hon. Member could give us a copy of the revolution. The Chair would like to have a copy of the 'resolution.'

MR. A. SNOW: I only proposed the resolution, not the revolution, Mr. Chairman. I think that is to follow.

MR. CHAIRMAN: The Chair would like to recess briefly to check on the amendment to see if it is in order.


MR. CHAIRMAN: Order please!

The Chair rules that the amendment meets all the requirements as outlined in our Standing Orders and Beauchesne for the requirements of an amendment to a money bill and therefore is in order.

SOME HON. MEMBERS: Hear, hear!

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

MR. A. SNOW: Thank you very much, Mr. Chairman. I am very pleased at the amount of research that was done on this Bill. It proved fruitful, at least to this stage.

Mr. Chairman, there is no doubt in my mind that people who have had experience in the private sector in operating business can also apply it to how they know you can collect, quite often, more revenues by lowering the price of something. Now that is not something new. That has been around for hundreds of years, that principal, and I know that people on the other side of the House recognize that. And, Mr. Chairman, all this amendment does will allow the Minister of Finance to lower the price of gasoline in these two border areas of the Province by using his tax system. That is all I am suggesting. I am not asking for a grant. I am asking for this House to give permission to the Minister of Finance to be able to lower the gasoline tax in border areas of the Province and, in my opinion, it would actually increase the revenues to this Province. It would actually increase because I firmly believe, I know, that the gasoline consumption in sales is going down in western Labrador while they have been tremendously increased in Quebec. So that tells me that the revenues there are starting to slip already, and once they start slipping I know that sales in liquor are going to slip, tobacco is going to slip, clothing, groceries, the whole lot of it, Mr. Chairman, and that all means a loss of revenue to this Province.

Mr. Chairman, I move that the Committee rise and report progress and ask leave to sit again.

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

MR. SPEAKER: The hon. the Member for Trinity - Bay de Verde.

MR. CHAIRMAN: Mr. Speaker, the Committee of the Whole have considered the matters to them referred, have directed me to report progress and ask leave to sit again.

On motion, report received and adopted, Committee ordered to sit again on tomorrow.

MR. BAKER: Mr. Speaker.

MR. SPEAKER: The hon. the President of Treasury Board.

MR. BAKER: Mr. Speaker, I would like to inform hon. members that the resolution to be debated tomorrow will be the one introduced today by the Member for LaPoile, and that on Thursday, we will continue with this particular bill we were debating today in Committee.

MR. SIMMS: Mr. Speaker.

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

MR. SIMMS: I wonder if I could ask my friend, the Government House Leader, just for future planning, on Thursday - I do not know if it will - if, by chance, the debate on this Bill No. 15 is concluded before 5:00 - say, well before, even - what happens then? What does he intend to call for Thursday, the rest of the day? That is just for planning purposes, as he normally tells us.

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

MR. BAKER: Depending on what happens tomorrow, between now and Thursday, I would like to call second reading of two Justice bills.

MR. SIMMS: (Inaudible) amendments that are non-controversial (inaudible).

MR. BAKER: That is right. There is a third one that I believe requires some work, and the work is going to be done.

MS. VERGE: (Inaudible).

AN HON. MEMBER: (Inaudible).

MR. SIMMS: Okay.

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

MR. BAKER: Mr. Speaker, I move that the House at its rising do adjourn until 2:00 p.m., tomorrow, and that this House do now adjourn.

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