June 9, 2005 HOUSE OF ASSEMBLY PROCEEDINGS Vol. XLV No. 30


The House met at 10:00 a.m

MR. SPEAKER (Hodder): Order, please!

Admit strangers.

This morning we would like to welcome to the House of Assembly fifteen Grade 7 students from Greenwood Academy in the District of Lewisporte, with their teachers Audrey Oake and Sam Mehaney, their chaperone Deborah Noseworthy, and their bus driver Dan Lewis.

Welcome to our House.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: By agreement, we have agreed that the hon. the Acting Government House Leader will speak to the House at this time relative to the adoption of some special rules.

The hon. the Acting Government House Leader.

MR. RIDEOUT: Thank you, Mr. Speaker.

Mr. Speaker, it has been agreed by caucuses on all sides of the Legislature that we would adopt special rules for the debate on the FPI amendment, or amendments to the FPI Act, as follows for the sitting today, June 9, and tomorrow, June 10. I would like to read those into the record so that they are available and understood. There are rules of procedures for the special sitting of the House on Thursday and Friday, June 9 and June 10, 2005.

Number one, a bill entitled, An Act To Amend The Fishery Products International Limited Act, Bill 41, will be debated for not more than two days, June 9 and June 10, 2005.

Number two, on those days, the House will sit from 10:00 a.m. to 10:00 p.m. We have agreed mutually that there will be a lunch break at 12:30 o'clock to 2:00 o'clock and there will be a dinner break in the evening from 5:30 o'clock until 7:00 o'clock.

Number three, the Premier, the Leader of the Opposition, the Member for Signal Hill-Quidi Vidi, the Minister of Justice, and the member who is the Official Opposition critic for either the Department of Fisheries and Aquaculture or the Department of Justice will have one hour each to speak. The Premier will have an additional twenty minutes when he speaks before the end of the debate, and the Minister of Justice will have twenty minutes to speak to close the debate. All other members will have twenty minutes to speak, with the exception of those members noted above. No other member may speak more than once during this special sitting of the House, with an exception that I will mention in rule six.

Number four, there will be a thirty-minute oral Question Period each day from 10:00 o'clock, or as soon as we are ready to start today, to 10:30 o'clock or whatever time is necessary thereafter on Thursday and Friday. The only topic for the oral Question Period will be the bill entitled, An Act To Amend The Fishery Products International Limited Act, Bill 41.

Number five, debate on Bill 41 will begin immediately after the adoption of those rules and, of course, after Question Period and the introduction of the bill, and, apart from Oral Questions, will be the only business of the House during the following two days.

Number six, amendments to the bill will be permitted, but only within the time constraints of those rules and provided that no member may speak more than once. The amendments will be proposed by either caucus. There is an agreement that there will be - once an amendment is proposed, the person proposing the amendment will have an additional twenty minutes to speak to the amendment, and one representative from each other caucus will have twenty minutes to speak at their discretion. In other words, if the amendment comes from the Member for Signal Hill-Quidi Vidi, then he, after he proposes the amendment, will have an additional twenty minutes to speak to the amendment. A representative from the Official Opposition will have twenty minutes to speak to the amendment, and a person from our caucus will have twenty minutes to speak to the amendment. Our speakers will be at our discretion, but it will done within the time frames that we have agreed to leading up to 10:00 o'clock tomorrow night. There is a special agreement that those amendments can be made, obviously, during second reading, and then they will be voted on when you, Your Honour, calls the vote during Committee.

The notice requirements for the motion respecting the rules for Bill 41 will be waived, we have agreed to that. When the debate has concluded - in any event, not later than 10:00 o'clock on Friday - the Speaker or the Chair of the Committee of the Whole will put the question on the motion for second reading. We will put all questions relating to the clauses of the bill in Committee of the Whole and we will put the question on the motion for third reading on Bill 41.

So, Mr. Speaker, these are the rules that have been agreed to by all caucuses or all parties here in the Legislature, and I propose that those rules be adopted.

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

MR. PARSONS: Thank you, Mr. Speaker.

We, indeed, are in agreement with the special rules that are being adopted for this session. I would point out, just as one matter of clarification - I am sure the Acting Government House Leader would concur, once I say this - with regards to the amendment piece, it is my understanding that what will happen is if a person proposes an amendment, which is okay to do, that person will have to do so during their speaking time.

For example, if the Member for Bellevue wishes to make an amendment he will do so during his twenty minutes of speaking. He will not address the amendment itself during that twenty minute period. He will only be making it during that twenty minute session. That will automatically allow each caucus twenty minutes, sometime later in the next two days, to address that amendment that was made by the Member for Bellevue. When we do put that amendment back on the floor for discussion at some point later, it does not necessarily require that it be the Member for Bellevue who addresses the amendment on behalf of his caucus, it can be whoever this caucus designates to use that twenty minutes to address the amendment.

Thank you.

MR. SPEAKER: The hon. the Member for Signal Hill-Quidi Vidi.

MR. HARRIS: Thank you, Mr. Speaker.

As it would be obvious, there have been discussions between the three parties represented in the House as to these rules. I just want to add one little piece for clarification because I think the debate is notionally taking place at second reading and everybody is speaking at second reading. This, in my understanding, would not prevent someone from moving an amendment that might otherwise be moved in Committee or at third reading, but the amendment would be moved during the second reading debate and the vote, that the Acting House Leader referred to, would take place at the end of our session. We would move into Committee to make those votes, if there have to be votes on particular clauses. So all the votes would take place at the end, in whatever form it has to be - whether it be the House or the Committee - but the fact that we are in a second reading debate will not prevent someone from moving an amendment to a particular clause of the act. We need to clarify that for the rules.

I understand from our discussions that these are rules that are setting parameters for the debate. They are not so rigid as so we cannot agree to clarify what the intention is at any particular time and, on that basis, we are certainly satisfied to have a special set of rules for this debate because of its particular importance to the people of Newfoundland and Labrador in general, and to many specific communities in particular.

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

MR. RIDEOUT: Thank you, Mr. Speaker.

The caveats that have been articulated by representatives for the Official Opposition and the NDP caucus are certainly our understandings. It is also - I can say on behalf of the government caucus that we are prepared to be flexible. We understand and realize that these are special rules. If some little wrinkle develops then we are prepared to get together with the representatives of the Official Opposition and the NDP caucus and try to work matters out, but as a broad parameter, these are the rules that we have all agreed to and I so move that they be accepted.

MR. SPEAKER: I thank the hon. members for their presentations. Is there agreement that these rules as outlines by the hon. Leaders of Parliament be adopted for this sitting?

All those in agreement, ‘aye'.

SOME HON. MEMBERS: Aye.

MR. SPEAKER: All those against, ‘nay'.

The motion is carried and these will be the rules.

I ask the leadership as well, if there is some disagreement, let the Chair know. If we need to call a recess and meet together, than that would be the desire of the Chair rather than having some extensive debate on the procedures occurring on the floor of the House. The required notice was waived in the agreements that have been reached.

At this time the Chair would ask the hon. Acting Government House Leader if he would move first reading of the bill before we go to the Oral Question Period.

MR. RIDEOUT: Thank you, Mr. Speaker.

Mr. Speaker, I move first reading of Bill 41, An Act To Amend The Fishery Products International Limited Act.

MR. SPEAKER: It is moved and seconded that the hon. the Minister of Justice and Attorney General shall have leave to introduce a bill entitled, An Act To Amend The Fishery Products International Limited Act, Bill 41.

Is it the pleasure of the House that the hon. the Minister of Justice and Attorney General shall have leave to introduce said bill?

All those in favour, ‘aye'.

SOME HON. MEMBERS: Aye.

MR. SPEAKER: All those against, ‘nay'.

Carried.

Motion, the hon. the Minister of Justice and Attorney General to introduce a bill, "An Act To Amend The Fishery Products International Limited Act," carried. (Bill 41)

MR. SPEAKER: It is moved and seconded the said bill be now read a first time. Is it the pleasure of the House that Bill 41, An Act To Amend The Fishery Products International Limited Act, be now read a first time?

All those in favour, ‘aye'.

SOME HON. MEMBERS: Aye.

MR. SPEAKER: All those against, ‘nay'.

Carried.

CLERK: A bill, An Act To Amend The Fishery Products International Limited Act. (Bill 41)

MR. SPEAKER: This bill has now been read a first time. When shall this bill be read a second time?

AN HON. MEMBER: Later today.

MR. SPEAKER: Later in this sitting day.

On motion, Bill 41 read a first time, ordered read a second time presently, by leave.

MR. SPEAKER: Before we call Oral Questions, the Chair would like to advise the House that this being a special sitting of the House on a particular, specific matter that the regular rules that might apply to Question Period in terms of times - I understand members may need extra time to establish their preambles and this kind of thing, so we will be giving some discretion to that matter so that all members who are posing questions, and members who are answering questions, can have the required flexibility as desired.

Oral Questions are now being called.

Oral Questions

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

SOME HON. MEMBERS: Hear, hear!

MR. REID: Thank you, Mr. Speaker.

My questions are for the Premier.

Mr. Speaker, earlier this week we were told that the FPI Income Trust Proposal was final and binding. Since that time the company has made many new commitments to communities such as Bonavista. While we, on this side of the House, are happy to see these new commitments from the company, this proposal seems far from final and binding. The Premier was very vocal in 2002 when debating the Voisey's Bay Statement of Principles because he did not consider it a final and legal document.

I ask the Premier: Is this proposal a final document or will there be other opportunities for changes to be made by either the government or the company?

MR. SPEAKER: The hon. the Premier.

SOME HON. MEMBERS: Hear, hear!

PREMIER WILLIAMS: Thank you, Mr. Speaker.

I thank the Leader of the Opposition for his question. I congratulate him on his new appointment. I wish him well. I do not envy you your position but you are very capable of living up to the task and I certainly wish you all the best.

On the basis of the first question; when we say it is final and binding - now it is not final and binding. What we have before the House is a package that has been negotiated to the best of its ability by the government over the course of the last fourteen months. This process started in April of last year and over fourteen months we have kept going back to the company to try and get basically more concessions for the people. We started from ground zero. We had absolutely nothing when they first came to us with an Income Trust Proposal and all the concessions that we have gotten since have all been incremental. The discussion is still not over.

For example, with regard to Harbour Breton - which I am sure hon. members opposite, as all government members feel - it is still an issue of great importance and of grave importance to the members of the government. The Harbour Breton discussion with FPI is still ongoing. I personally can say, as Premier of the Province, that I am not satisfied right now with the commitment that has been made to the people of Harbour Breton and, in fact, we will be looking for more and needing more before this process is concluded.

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

MR. REID: Thank you, Mr. Speaker.

Mr. Speaker, it certainly appears that the company is making last-minute commitments to gather support for this proposal. Earlier this week, the company promised Bonavista a new plant, something that was not spelled out in the original agreement that we saw on Monday; however, the company is not planning to build this new plant until late 2007 or 2008, after the next provincial election.

I ask the Premier: Why is the company waiting so long to fulfill this commitment when we all know that this plant needs to be replaced now? And, what guarantee does the government have that this company will not have a change of heart in the next three years?

MR. SPEAKER: The hon. the Premier.

SOME HON. MEMBERS: Hear, hear!

PREMIER WILLIAMS: Thank you, Mr. Speaker.

One thing I would like to make very clear to all members, including the Leader of the Opposition, is that we are not here to defend the company under any circumstances. This proposal is being tabled before this House for consideration by all members in a true free vote where all members are free to vote as they wish, and I am sure you will probably see different opinions on both sides of the House in the course of this whole dialogue.

The Bonavista situation was one of the options that actually was put forward and was exercised. I hope that over the course of the next two, three, twenty-four, hours that new matters come on the table, because every time we get something incremental here, every time we get something more from the company, it is something more for the people of Newfoundland and rural Newfoundland and Labrador, it is more for the communities.

This process alone, this debate in this House, these questions, what we are doing on an individual basis in order to try and lever more concessions from the company, is all in the best interests of the people of this Province and I would certainly welcome it.

SOME HON. MEMBERS: Hear, hear!

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

MR. REID: Thank you, Mr. Speaker.

I say to the Premier, I know that you are not here defending what FPI is trying to do, but we need to talk about the guarantees that FPI is putting forward.

Mr. Speaker, FPI has stated that they will guarantee all of their plants will stay open for the next five years subject to - and that is the key one, subject to - economic viability and resource availability.

I ask the Premier: Does he feel this commitment is strong enough to protect these fish plants in the Province, or does he have any concern that other communities may suffer the same fate that Harbour Breton has, due to economic viability and resource availability?

MR. SPEAKER: The hon. the Premier.

SOME HON. MEMBERS: Hear, hear!

PREMIER WILLIAMS: Thank you, Mr. Speaker.

Mr. Speaker, I am always concerned that any communities in this Province might suffer a fate similar to what is happening to Harbour Breton, and that is why we are working so hard to try and correct that.

What we have done here is, we have negotiated to the best of the ability of government, the best possible proposal and covenants and conditions that we can get before this hon. House. The question of economic viability is defined as, "‘economic viability' for a facility will be deemed to occur if FPI incurs significant losses with no reasonable prospect of curtailing such losses for that facility."

That is a fairly strong commitment. It is not 100 per cent. It is not foolproof. None of this transaction is 100 per cent. There are no guarantees that the Government of Newfoundland and Labrador has been able to close every possible loophole in this transaction. It would be wrong for me to stand here and say that, and that is why the matter is before the House; because I think, as a group of hon. members who represent districts all throughout our great Province, we have to weigh this, we have to balance it. We have to try and see, okay, what are the pros, what are the cons? On balance, is this a good decision for the people of Newfoundland and Labrador? That is what it is all about.

These are strong covenants. They are never foolproof. We cannot control the actions of a company and what its board of directors can do. There is a certain amount, of course, that has to be taken in good faith beyond a certain point, but we do have the legal commitments. We will have them in writing, we will have them in a term sheet, and the remedy - is the term - for a default or a breach will be the loss of the quotas. The quotas are of significant value, and they will revert to the Province. Of course, then there is the ten-year lease arrangement, but the values of these quotas could be well over $100 million, so that is a significant penalty and a significant punishment for any breach of any of these conditions.

SOME HON. MEMBERS: Hear, hear!

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

MR. REID: Thank you, Mr. Speaker.

Mr. Speaker, we have heard commitments from FPI before. As a matter of fact, in 2001, the company promised a number of things, including: to rebuild their plants, to rebuild their fleet, and to create more employment rather than less employment in this Province. You can ask the people of Harbour Breton how solid FPI's commitments were.

I ask the Premier: What guarantees do you have that the company will actually follow through on the commitments that they have made to the people of the affected communities?

MR. SPEAKER: The hon. the Premier.

SOME HON. MEMBERS: Hear, hear!

PREMIER WILLIAMS: As the hon. Leader of the Opposition knows, we were not in power in those days. There was a different process going on, and I cannot speak for what went on with regard to discussions with FPI at that particular point in time.

The hon. the Leader of the Opposition was Minister of Fisheries at the time and certainly would be well versed in what transpired. I can only speak for what we are doing now. As I have said, our Justice Department lawyers have been on this. We have retained independent counsel to make sure that we have the best legal advice that we can get available on this. We have tried to cover off every loophole, and we put in severe punishment, as I said before, severe remedies, in the event that the company defaults.

There is no guarantee, as I can say, that the company may not do something untoward down the road. We have to deal with these people in good faith. This is a reputable company. It is a public company but, you know, they do have a responsibility to their shareholders and that is the dilemma we are faced with in this Province. We have a company that was a public creation, which came out of statute and which was funded by the Province and the federal government and private investors. Now it is trying to survive as a private company with a public and a social string attached. It is our obligation here, as Members of the House of Assembly and the Government of Newfoundland and Labrador, to make sure that we hold them to those social commitments and to put their feet to the fire, and that is what we are doing to the best of our ability.

SOME HON. MEMBERS: Hear, hear!

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

MR. REID: Thank you, Mr. Speaker.

I know it is a private company but it is, after all, a creature of this Legislature.

Derrick Rowe, the CEO of FPI, is on public record saying that FPI will eventually become a shellfish company. Minister Taylor is on record as saying that, due to the number of issues facing the groundfish sector, there is currently very little money to be made in groundfish.

I ask the Premier: By pulling the groundfish quotas from FPI, quotas that are not - and I stress, they are not - the company's most substantial assets, won't you only be hurting the employees who work in these plants? Isn't it true that the government has no real punishment should FPI fail to live up to their commitments?

MR. SPEAKER: The hon. the Minister of Fisheries and Aquaculture.

SOME HON. MEMBERS: Hear, hear!

MR. TAYLOR: Thank you, Mr. Speaker.

Mr. Speaker, as the Premier said, there are no guarantees associated with the proposal that we have in front of us today. There are, to the extent that we could arrive at some safeguards - some substantial safeguards over and above what we had previously - we have done that; however, we cannot ensure that absolutely every conceivable negative occurrence that might come towards us in the future can be protected against.

Mr. Speaker, the groundfish allocations, no, there is little money to be made in groundfish in Newfoundland and Labrador today - very little money to be made in groundfish in Newfoundland and Labrador today - however, the value of groundfish quotas are still substantial to FPI and to people who are in the groundfish industry. There are people in groundfish throughout this world who, because of the way that they are handling their fish, or the volumes of the fish that they have, have the ability to make money. We believe that the groundfish industry in Newfoundland and Labrador can be a viable industry, and it will be a viable industry again in the future.

Mr. Speaker, what we have tried to do here - and I suppose only time will tell - in negotiations over the past fourteen months with FPI is in trying to get undertakings from the company to have a substantial penalty associated with the non-compliance of those undertakings. We believe that the loss or the potential loss of groundfish allocations to FPI represents a substantial penalty to the company in the short term and the long term. It also could represent substantial protection for the people of Newfoundland and Labrador.

Whether it is a penalty for the company is one thing, but I think that the ability to ensure that quotas associated with FPI's operations in Newfoundland and Labrador remain in Newfoundland and Labrador is a very important, very fundamental, principle that the people of Newfoundland and Labrador have long wanted respected.

SOME HON. MEMBERS: Hear, hear!

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

SOME HON. MEMBERS: Hear, hear!

MR. REID: Thank you, Mr. Speaker.

We have only been into this debate for five minutes and I find it rather disconcerting to hear both the Premier and the Minister of Fisheries say that we have no guarantees. Mr. Speaker, there is currently a 15 per cent share restriction in the FPI Act that prevents any one investor from owning more than 15 per cent of FPI. I ask the Premier if he is concerned that if we amend this act today that a direct competitor of FPI, like the Icelandic Group, could end up owning 40 per cent of the American assets while also holding 15 per cent of the entire company?

MR. SPEAKER: The hon. the Minister of Justice and Attorney General.

SOME HON. MEMBERS: Hear, hear!

MR. T. MARSHALL: Mr. Speaker, the current FPI Act places a restriction on the number of shares that may be held by a shareholder in FPI or FPI International Limited. Requests were made to FPI for similar restrictions with respect to the Income Trust, but, unfortunately, because the Income Trust will trade on the open market down in the U.S., such a restriction could not be obtained without undermining the ability of the trust to raise sufficient funds. However, we have requested of the company, and the company has agreed, that they will obtain undertakings from Sanford and Clearwater not to own trust units greater than 15 per cent and they will use their best efforts to obtain the same commitment from the Icelandic company but, indeed, the Icelandic company may not, in fact, come forward with such a commitment.

SOME HON. MEMBERS: Hear, hear!

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

MR. REID: I say to the minister, that is one thing that concerns us, Mr. Speaker, the fact that a direct competitor in the U.S. can hold or own so much of a company that is so near and dear to the hearts of the people of this Province.

Mr. Speaker, the only thing in this agreement for the Town of Harbour Breton is the $3 million that the town believes they are entitled to receive because of the complaint that they have lodged to the Labour Relations Board. In essence, all the town is getting is what they consider FPI already owes them.

I ask the Premier, knowing that no quota could mean the end of the Connaigre Peninsula, why didn't government fight harder to secure a quota for Harbour Breton before bringing this proposal to the House today?

MR. SPEAKER: The hon. the Premier.

SOME HON. MEMBERS: Hear, hear!

PREMIER WILLIAMS: I can assure the people of Harbour Breton, as I have assured their committees that I have met with on, at least, three and maybe four occasions as recently as yesterday. I met with Father Brophy, the pastor of the community, last Thursday.

With regard to the whole issue of quotas, I have been in touch with the federal government, as the Minister of Fisheries has, and spoken to Minister Regan with regard to the issue of a shrimp quota. I have spoken to senior officials in the Prime Minister's office. I have spoken to the Prime Minister himself. I have spoken to Minister Stronach, Human Resources and Employment, on three separate occasions. I have written her a letter indicating just how urgent and how serious this whole matter was. We have done basically everything we can. I have spoken to the Member of Parliament, Bill Matthews. I have met with MHA, Oliver Langdon. Every, single time there was a request from the people of Harbour Breton, Mayor Don Stewart and the members of their committee, we have met with them. We have done everything we can. Minister Dunderdale was also present at those meetings. We have explored every possible alternative and every possible opportunity.

With regard to where the company is right now, I spoke with the Harbour Breton Committee and asked them what they wanted us to ask of FPI when we went into this negotiation. At that particular point in time they indicated that - they asked for $1.4 million while their action on the labour relations side was still separate. They asked that the plant and equipment, of course, be provided to the community if, in fact, they wanted the plant because of possible environmental concerns, and we have concerns with regard to maintenance. As well, the quota. The issue of the quota was also put forward.

Those issues were put to FPI; put to FPI again and again and again and again. What FPI finally said at the end was exactly what we got; is that the $1.4 million, which was the original asked by Harbour Breton, was provided. The plant and equipment is available subject to part of the redfish line coming out. What we did do though, we actually increased the ask and asked FPI to put even more money on the table. They put an extra $1.6 million on the table. So that was an incremental gain for the Community of Harbour Breton. They see that as a possible problem because there is a trade-off between the $3 million and what they might get in a successful claim before the Labour Relations Board. There is a separate side issue as to whether that claim will be successful or not. That is something that the committee, the people of Harbour Breton have to weigh, whether they see that as a gain or whether they see that as just a trade-off. From our perspective, we took the company as far as we could.

In the last twenty-four hours, officials from government have been in contact with the company. We have met with the committee from Harbour Breton with a view to try and increase the amount of money that is made available to get more cash, some money for the plant for a rehab of the plant, so that if they get a quota they can get up an operation. We have also asked for additional money which could be provided in order to go towards the cost of a quota. As a government, we, as well, have said to them as recently or for the first time yesterday, that if a quota is available that it could even be bought from an independent source - because we have reason to believe that there is a redfish quota available - that the Government of Newfoundland and Labrador, subject to approval by Cabinet, would be prepared to ascertain an acquisition of that and prepared to come up with a contribution towards acquiring a quota.

So I can assure the Leader of the Opposition and all hon. members opposite, that we are doing everything we can to try and get what Harbour Breton wants. That is a primary goal for us.

SOME HON. MEMBERS: Hear, hear!

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

MR. REID: Thank you, Mr. Speaker.

It is our understanding from the proposal that in order for the people of Harbour Breton to receive the $3 million from FPI that they are proposing, that they have to take the case which is before the Labour Relations Board off the table. That is why we are saying that all they are getting is what they deserve because we feel they will win that case before the Labour Relations Board.

Mr. Speaker, I am sure the people of Harbour Breton appreciate the short-term funding that the government is planning to inject into the community; however, they do not see this as a long-term solution.

I ask the Premier: Are you willing to go back to FPI and ask them to amend this proposal to leave part of the traditional quota that Harbour Breton had in that community before the vote takes place tomorrow in this House of Assembly?

MR. SPEAKER: The hon. the Premier.

SOME HON. MEMBERS: Hear, hear!

PREMIER WILLIAMS: First of all, on the case before the Labour Relations Board, there is no guarantee that the community of Harbour Breton will be successful there, so the community of Harbour Breton would have to obtain a legal opinion of its own to see whether they feel they can be successful. There is some question as to whether they can, some question to as to whether they cannot, so I guess, in simple terms, the question is whether they would want to accept a settlement of some of that amount of money now. That is a separate issue, and I understand why they would not want to trade it off, but sometimes getting the money now - the possibility of not getting the money in a court case - might be the right decision. That is something that the community obviously has to consider.

With regard to going back to FPI, we were back to FPI. We are back to FPI as we speak. The committee last night, after their meeting with us, went back and met with FPI. They asked FPI, and FPI said no. We are back to FPI again this morning. We are certainly asking them to reconsider, because the company needs to know that there is some very, very serious concern on this side of the House, as I am sure there is serious concern on your side of the House and with the members of the New Democratic Party and the Independent member.

This is a huge priority for us. We are saying to the company that they have to step up. They have to improve on that offer. That demand is being made to them privately and it is being made here now publicly in this House.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The hon. the Member for Fortune Bay-Cape la Hune.

MR. LANGDON: Thank you, Mr. Speaker.

I guess the Premier might have answered some of what I have in my question. Nevertheless, I will ask it anyhow.

Mr. Speaker, FPI has left Harbour Breton and the whole Connaigre Peninsula high and dry in the whole process. Representatives of the town, and myself, met with Derrick Rowe and officials from FPI last night, as the Premier suggested that we should do, to see if we could secure a percentage of their quota for Harbour Breton. Mr. Rowe's response was: What I have written, I have written - signifying there would be nothing new in the term sheet for Harbour Breton plant in the proposal, frustrating the mayor and the union people who were there.

I ask the Premier: Will you meet one final time with FPI and insist on a quota for Harbour Breton before the legislation is passed?

MR. SPEAKER: The hon. the Premier.

SOME HON. MEMBERS: Hear, hear!

PREMIER WILLIAMS: I say to the hon. member, absolutely. If a face-to-face meeting would help with that, I would only be too delighted to do it, as would any of our ministers who have already met with FPI.

We are actually in a telephone communication with them as we speak. We have done it already this morning. They are certainly aware of the situation, as they are aware from your committee. They understand that the mayor was on Open Line this morning, again, making a plea to the company.

This issue is very much in their face, but if the member felt that a meeting with me and FPI would help, I would only be too delighted to do so.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The hon. the Member for Fortune Bay-Cape la Hune.

MR. LANGDON: Thank you, Mr. Speaker.

Mr. John George, Chair of the Action Committee in Harbour Breton, I think, is reflecting everyone's opinion on the Connaigre Peninsula when he says there should be no passing of this legislation unless Harbour Breton is a part of the agreement in the form of a quota from FPI for the region.

I know some of it seems to be repetitive and so on, but, understanding the plight of the people who are there, it says: Mr. Premier, are you prepared to commit that there will be no agreement without a quota secured for Harbour Breton from FPI?

MR. SPEAKER: The hon. the Premier.

SOME HON. MEMBERS: Hear, hear!

PREMIER WILLIAMS: As the hon. member understands, what we have before the House is pretty well a black and white situation. The proposal that we have before the House right now is what the House has to consider. We are working behind the scenes and in the scenes, basically, to try and obtain greater concessions. What will have to happen in this House at the end of the day, all hon. members are going to decide whether, in fact, this is going to pass or not. If the company wants this to pass, then I would suggest to the company that it seriously consider what it has on the table for Harbour Breton.

SOME HON. MEMBERS: Hear, hear!

PREMIER WILLIAMS: That is the issue, because it is black and white, it is a yes or no, and either the proposal and the amendment to the legislation that would allow the Income Trust to go will either rise or fall on what they put forward, particularly on behalf of the people of Harbour Breton.

Just from our own personal perspective, as a government, the MHA knows that we put the $250,000 on the table originally for a business plan, and that is a relatively small amount of money in the big scheme of things, but it is specifically targeted money so that we can come up with long-term economic diversification. As well, we have said that we put a million dollars on the table for income support. We had that hitched originally to the federal government, in order to give the federal government some incentive to step up to the table here.

We have quite clearly, since that, stated, though, that is completely separate and apart, that this government will stand behind the people of Harbour Breton. We understand the hardship. We understand the hardship that has been expressed by Mr. George and his committee, by the Mayor, Mr. Day, and others, with the representations that you, yourself, have made to us. So that $1 million will be made available because we know in the near term that in July and in August I think there are eighteen people who are coming off employment insurance. As well, over the course of the next two months there will be something like sixty, seventy or eighty again, so this problem escalates and gets more serious. Our money will be there and will be available, as some has already been provided to the community, so we are doing everything we can.

As you know, as of yesterday, we have also indicated that we are prepared to make a significant commitment to come up with some matching funds in the event that we are able to purchase a quota.

The quota seems to be the big issue. Not that it seems to be, it is the big issue for the people of Harbour Breton. Income support is a short-term measure for them. Their pride, then, is at stake, and the question of the hope and the spirit that is going on in that community now. You know, some people feel that there might be some hope, but there is a feeling of despair in the community. I want you to know, and I want the people of Harbour Breton to know, that this government has done everything that it can, and it will do everything that it can, in order to get some satisfaction for the people of your community.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The hon. the Member for Signal Hill-Quidi Vidi.

MR. HARRIS: Thank you, Mr. Speaker.

My question is also for the Premier.

The Minister of Justice and Attorney General was - I do not want to put too many words in his mouth - giving the indication yesterday in the media that two of the communities, or two of the three problems have been solved, and that seemed like a pretty good way to go.

We are hearing this morning that the Premier is not satisfied, that the people over opposite are not satisfied. We are certainly not satisfied. Two out of three ain't bad might be all right for a pop song, but it is not good enough for the people of Harbour Breton.

What I want to know, Mr. Speaker, is: Why are we here if the solution for Harbour Breton has not been found? If we do not have an answer for Harbour Breton, how can we come here and debate this legislation without some satisfaction, some hope for the future of Harbour Breton without that piece being done? Why are we here now doing this when the people of Harbour Breton have not been treated fairly by this company and they do not really have in place what is going to be necessary for them to give them a future? Why are we here?

MR. SPEAKER: The hon. the Premier.

SOME HON. MEMBERS: Hear, hear!

PREMIER WILLIAMS: Thank you, Mr. Speaker.

We are here because we have to deal with this issue now. I think, as the hon. member understands, there have been some significant concessions that have been gained over the course of the last fourteen months. We have come a long way. I am not going to go down through all of them now, because I am sure he might have other questions that are important to the people of the Province, but with regard to rural Newfoundland and Labrador, we do have the five-year safeguard to all the communities. We know what has happened in Bonavista. We know what has happened in Fortune, and the Member for Grand Bank and Fortune has indicated publicly that there are good things in here for rural Newfoundland and Labrador.

We have pushed the Harbour Breton file at every single opportunity. I can only say to you, time and time again, we have taken it to the point as far as we can get it right now, but we are also saying here publicly, as I am sure the Leader of the New Democratic Party is saying, and, of course, as members opposite and all our members are saying, we want more. We are not satisfied with this, and the company is going to have to step up.

The matter is now before the House because, you know, this company, whether we like it or not, has put us in a situation where we have to deal with it. We are darned if we do and we are darned if we don't. If the Income Trust does not go through, then this company is saying that it is in a very serious financial situation. They are unable to raise money.

If they are unable to raise money, then if we do not pass the Income Trust, then where do we go? What happens with the company? Does the company then decide, on its own, that it is going to have to start taking action; that, you know, Fortune will not get the concessions that it needs, Bonavista will not get the concession that it needs? Other communities, Harbour Breton, of course, will get nothing, or only what is on the table right now. Other communities will not have the safeguards.

The weight here, the balancing act that we have to do here, is decide whether the concessions that we have are good enough to allow this company to go through with this transaction acknowledging that it is not perfect. I think that is the reality.

We are here in the House right now because the company is saying that it has to act right now. It has to decide whether it is going to go ahead with the Income Trust. Otherwise, it looks like it might have to take other action, and we have no way of predicting what that action could be.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The hon. the Member for Signal Hill-Quidi Vidi.

MR. HARRIS: Thank you, Mr. Speaker.

The Premier talked about the possibility of a redfish quota. Yet, FPI wants to take the redfish line out of Harbour Breton as part of this deal. We do know, for example, years ago, when Trepassey went down, that there was a $7 million diversification fund put in place. We know also that there may be options for Harbour Breton, whether they be in aquaculture, whether they be in another quota or another species, or whether they be in some other action that might happen in the future. All of these will cost money.

What I want to know, Mr. Speaker, is, why don't we have in place, before we are asked to take this action, some kind of diversification fund that is going to ensure that there is some hope for the future of Harbour Breton, because all of these options that we are talking about all cost money, whether it be purchase of a quota, whether it be gearing up a plant, whether it be considering other options. Why don't we have that in place now, and why aren't we insisting that be done before we are asked to decide whether or not we are going to let Fishery Products International go its own way?

MR. SPEAKER: The hon. the Premier.

SOME HON. MEMBERS: Hear, hear!

PREMIER WILLIAMS: As the hon. member can understand, we are trying to lever whatever money we can out of whatever groups are available. The provincial government is prepared to step up. It has made the commitment to the community. The provincial government has reasonably limited resources. We are not cash flush. We do not have all kinds of money to throw out all over the place; however, we do recognize the importance of Harbour Breton as the anchor to the Connaigre Peninsula. If this government allows Harbour Breton to die, then it is saying to the Connaigre Peninsula that you are on your own and that over time all the communities down there will die off themselves. That just simply is not going to happen.

We are there and we are committed to doing whatever we can, but we are at a point now where we are trying to get as much leverage as we can to get as much from FPI, because they have an obligation to the people of Harbour Breton. The people down there have worked very hard to make a profit for that company over the years. They have run their operations. They have a great workforce and there is a moral obligation to the people of Harbour Breton by FPI to make sure that they deliver for them.

On top of that, the federal government has to step up. The hon. member knows that as well, Mr. Speaker. Forgive me for addressing to the hon. member, but, Mr. Speaker, the federal government knows that they have to step up here. Even though there is a lot of lip service being paid, and even though I have talked to the Prime Minister and I have talked to the ministers and I have talked to people involved - and I know Member of Parliament Matthews is doing whatever he can - they still really have not ‘ponied up' here. So, there is a role here for Belinda Stronach, Minister Stronach, and the Department of Human Resources, for Joe McGuire, the Minister for ACOA, to step up here; for Minister Regan to step up here. All of them are involved, but we still have not seen anything yet, and it is about time that the federal government really started to step up and do something; whether that comes from money through ACOA for economic diversification, whether that comes from money from Minister Stronach for income supplement, whether that comes from Minister Regan to provide either a shrimp quota, and/or to provide other quotas. I have been in contact with the Prime Minister and with the Clerk of the Privy Council as well to look at a separate pelagic quota for Harbour Breton. So that -

MR. SPEAKER: Order, please!

With the flexibility we have, we still have time for one more question. I will go to the Opposition House Leader.

MR. PARSONS: Thank you, Mr. Speaker.

I appreciate the fact that the Premier has a lot of information to give to us, but it is Question Period. Again, within the rules of the responses, we are trying to keep them within the time frames because there are a lot of questions that we need to ask and I am sure we will get the answers in debate.

Since I have time for one question, Mr. Speaker, my question is for the Premier. Premier, the term sheet that is being circulated by FPI with regards to this transaction outlines a number of commitments by FPI to the Province in return for them being allowed to establish this Income Trust. I will not get into the numerous commitments that had been made but, suffice it to say, that the agreement provides that if FPI fails to keep those commitments, they are promising to turn all of their groundfish quotas over to the Province.

Premier, did the government or its negotiating team, at any time throughout the negotiations, ask FPI to also commit to turn its shellfish quotas and dragger fleet over to the Province in the event that they default on their commitments?

MR. SPEAKER: The hon. the Minister of Fisheries and Aquaculture.

SOME HON. MEMBERS: Hear, hear!

MR. TAYLOR: Thank you, Mr. Speaker.

Mr. Speaker, the only shellfish allocations that FPI have in waters adjacent to Newfoundland and Labrador are two shrimp licences, two shrimp allocations that they have, which are now fished on the Newfoundland links. Those allocations have, since their inception, been harvested, processed and ready for market at sea on board factory-freezer trawlers. They provide a minimal amount of employment for people on shore. The real labour and potential value associated with onshore production has always been, and we believe will continue to be, associated with the groundfish allocations. Therefore, for that reason, we pursued the groundfish allocations. That is what we pursued. That was a land based processing, onshore based processing. The shellfish allocations were at sea based allocations and had very little impact on the shore based operations, Mr. Speaker.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The time assigned for Question Period has expired.

The hon. the Acting Government House Leader.

MR. RIDEOUT: Thank you, Mr. Speaker.

Mr. Speaker, I move second reading of Bill 41, An Act To Amend The Fishery Products International Limited Act, pursuant to rules that were, earlier this morning, adopted by this House.

MR. SPEAKER: It is moved and seconded that Bill 41, An Act To Amend The Fishery Products International Limited Act, be now read a second time.

Motion, second reading of a bill, "An Act To Amend The Fishery Products International Limited Act." (Bill 41)

MR. SPEAKER: The hon. the Minister of Justice and Attorney General.

SOME HON. MEMBERS: Hear, hear!

MR. T. MARSHALL: Thank you, Mr. Speaker.

I am pleased this morning to address hon. colleagues and to introduce Bill 41, An Act To Amend the FPI Act, which, if supported by the members of this House of Assembly, will amend the FPI Act to allow Fishery Products to move forward with, what is know as, the FPI Income Trust Proposal.

It is my duty today to lay out some of the facts and some of the history of the transaction that would see the company restructure what is known as its U.S. marketing and valued-added group, such that FPI would have an indirect 60 per cent economic interest in that group and the remaining indirect 40 per cent interest in the U.S. operation. When I say U.S. operation, I am referring to something called Ocean Cuisine International, which includes the Burin secondary processing facility. They would own 40 per cent but that the company would still be, in a sense, controlled by FPI because FPI, notwithstanding the fact, can only hold 60 per cent economic interest would in fact own 90 per cent of the voting rights in that company.

The process before us during the next couple of days will provide an opportunity for all members to voice their opinions, to debate openly and to conclude with a free vote. The Whips are not out on this particular vote. Members will vote to support the bill or they will vote against its passage. If the proposal is supported by the members of this House the government will then enter into further discussions with FPI to finalize the Term Sheet and to put the final form of agreement into a final agreement form and this legislation would not be proclaimed until the final form of contract is agreed on and ready to be signed.

I know that all hon. members in this House, members on this side and that side of the House, are all committed and determined to protect and revitalize rural Newfoundland and Labrador. FPI has a significant presence in many of our rural communities, and the fishing industry is, of course, an important lifeline for communities right across the Province. It is therefore vital to act in the best interests of those communities, the plant and the workers, which are directly or indirectly impacted by FPI and its subsidiary companies. It is equally vital to allow FPI room for growth and expansion in order to sustain a viable and competitive business within, of course, the framework of the FPI Act.

We have spent months in discussions with FPI and we have moved to the Legislature now to provide the opportunity for elected representatives to debate what is brought before this House and to vote openly and freely on behalf of their constituents and on behalf of the people of this Province.

Let me be clear, that this proposal is not a government proposal, it is a proposal from FPI that is being placed before this House for its consideration. For the benefit of the members, I would like to take this opportunity to provide some information on the background of FPI and on the current proposal that is before this House today.

In 1983 the assets of a number of fish companies, eight fish companies I believe, which were in financial distress at the time, where combined with the aid of the Bank of Nova Scotia and the federal and provincial governments to form FPI, and the FPI Act was passed at that time. FPI Limited, the holding company, and Fishery Products International Limited, the operating company, were established under the FPI Act, to ensure long term stability in the Province's fishing sector, by combining a number of companies into a single, large, modern, competitive and, what was hoped to be, profitable company.

Fishery Products International, FPI, is a publicly traded Newfoundland company and it owns 100 per cent of its subsidiary operating company, Fishery Products International Limited, also known as FPIL. Both companies are incorporated in Newfoundland and both companies have their head office in St. John's, where a major part of its administrative and financial management is done.

FPI has, in fact, two distinct business operations, or two business units. It has what is known as the Primary Group and what was formally known as the Marketing and Value Added Group, now known as Ocean Cuisine International. The Primary Group is what most of us in Newfoundland and Labrador are familiar with. It manages the company's harvesting and primary processing and their international sales and marketing, and they operate five key businesses, groundfish, snow crab, sea scallops, cooked and peeled scrimp and offshore shrimp. As I said, the headquarters is in St. John's. The company operates fish plants in Fortune, Burin, Triton, Port Union, Marystown, Bonavista, Dildo and Port au Choix. It operates a fleet of groundfish, shrimp and scallop vessels, and vessel service centres not only in Newfoundland and Labrador but also in Nova Scotia. The company purchases raw material from hundreds of independent harvesters in Newfoundland and Labrador, and markets the products worldwide. It is also an international marketing and sales agent for, and member producer of, Atlantic Queen Seafoods Limited, which is a consortium of crab producers in Eastern Canada. It has a payroll in this Province of $90 million. That is the primary group.

The other group is known as Ocean Cuisine International. It was formerly known as the marketing and value-added division. The OCI division manages the company's value-added processing operations, globing sourcing, product research and development, and North American sales and marketing. As I said earlier, it was formerly referred to as the Marketing and Value Added Group. It has three channels. The OCI unit has three channels of business exclusively in North America.

First of all, they sell commodity seafood, seafood purchased from FPI and sold into the North American market. It is also a marketing company and provides marketing services for other companies to help them sell their product, their commodity seafood, in the North American market, and this is done on a commission basis.

I think the most important and the most significant aspect or unit of the OCI group is what is known as its value-added division, and that is the division which takes the commodity seafood and adds value to it, and vegetables and glazing and other products, and it is sold into the at-home and away-from-home U.S. markets. I think, Mr. Speaker, that is where the company sees its future growth and that is where the company sees its greatest profit potential.

The everyday group, or the OCI group, the assets of that group represent only about 37 per cent of the total assets of FPI Limited; yet, it contributes 64 per cent of the revenues of the total company and 62 per cent of the gross profits of FPI Limited.

The OCI group is based primarily in Massachusetts. It operates a value-added manufacturing facility at Danvers, Massachusetts, which is just north of Boston. It operates a culinary research and development centre in Danvers as well. It operates a cold storage and distribution centre at Peabody, Massachusetts, which is about five miles away from Danvers, I understand. They have approximately 400 employees in its production, quality assurance and R&D sectors, its distribution and traffic divisions, its office and administrative section, and its sales and marketing section. One hundred of its employees work in Burin.

They have sales offices throughout North America and, most importantly, the OCI group operates a value-added or secondary processing facility in Burin which manufactures value-added products. I understand the Burin process is about 26 per cent of FPI's total volume of seafood.

They are the two main divisions of this company, Mr. Speaker. FPI is a publicly-traded company owned by investors throughout the world. Its business activities - it conducts business activities just like any other fish company or seafood company in Newfoundland and Labrador and in other places, but its activities are also governed by what is known as the FPI Act.

The original objectives of that legislation were to: (a) protect monies that had been invested by government in the company. Members may recall that there were a number of fishing companies or seafood companies that were in financial distress and the government formed the new company, FPI, and invested. The Bank of Nova Scotia, the federal government and the provincial government invested public funds in that company in order to have it survive. One of the objectives of the act was to protect those public monies.

Also, there was a desire to provide a hedge against unfettered private ownership of the company. As a result of that, a provision was put in the act that ownership - no one person would be entitled to own that company. Therefore, there was a 15 per cent share limitation so that no one person, and no related parties or associated parties of that person, would be able to own more than15 per cent of the share capital of FPI and FPI International Limited.

Another objective was to avoid corporate raiding or asset breakup. Another objective was to ensure that the operations of this company in the Province continue. In general terms, the FPI Act provided a means to ease the transition for FPI Limited from government ownership back to the private sector. I believe the act, what we refer to as the FPI Act, is, in fact, entitled, An Act Respecting The Return Of The Business Of Fishery Products International Limited To Private Investors.

The FPI Act contains several provisions for the purposes of accomplishing the objectives I just outlined. The main ones are: that the majority of the Board of Directors of FPI and FPI Limited must be residents of this Province. Also, the head office of both of those companies must remain in the Province of Newfoundland and Labrador.

As I indicated earlier, the act imposes a restriction on securities ownership whereby a single shareholder cannot own more than 15 per cent of the share capital of the company. I understand the Act was amended from what it was originally to make that restriction to apply to non-voting shares as well as voting shares.

The Act also contains section 7, and section 7 says that neither - I am going from memory here - but neither FPI or FPI Limited may - I will just get the correct wording here. Neither FPI Limited or Fishery Products International shall sell, lease, exchange or otherwise dispose of all or substantially all of its property or its business which relates to the harvesting and the processing and the marketing of seafood. That provision was put in the Act, Mr. Speaker, I understand, to ensure that the companies would not be broken up. That was the situation before this latest proposal.

In 2004, FPI announced a proposed transaction what would restructure its North American seafood and marketing business, the Marketing and Value Added Group. That group would be sold to another company. The sale would involve a series of transactions to create the new corporate structure, an American company based in Delaware in the United States, that will own the Ocean Cuisine assets, it will own the US Marketing and Value Added assets, as well as the Burin secondary processing facility. The structure is being set up in such a way that FPI will own an indirect 60 per cent economic interest in that new company. The other 40 per cent indirect economic interest would be owned through a series of transactions by something called an income trust which FPI would establish under Ontario law.

Mr. Speaker, I won't take a long time in dealing with the series of transactions which set up this new structure, but essentially the US operation was 100 per cent owned by a subsidiary of Fishery Products International Limited. The shares in that company are being transferred to the new US company which will be based in Delaware. These two companies will be amalgamated. Preference shares will be issued to FPI, along with certain debt. Under those preference shares - and this is important, Mr. Speaker - FPI will have 90 per cent of the voting rights. While they will only have 60 per cent economic interest in the American company, they will have 90 per cent of the voting rights, as long as they maintain greater than 10 per cent of the economic interest. The other 40 per cent of the shares in the new US company, OCI US will be 100 per cent owned by a Canadian company called OCI Canada. The shares of OCI Canada will be 100 per cent owned by a Limited Partnership known as the OCI Limited Partnership. That is a partnership that will be established under the Manitoba law and managed by a General Partnership. Sixty per cent of the units in the Limited Partnership will be held by Fishery Products or FPI. The other forty units in the Limited Partners will be owned by the OCI Trust which is established under Ontario law, in turn owned by the Income Fund, and in turn owned by the unit holders who will purchase units in the Income Trust.

The bottom line, Mr. Speaker, is that the American operation, the value-added seafood operation, the marketing operation, which is essentially involved in North American operations, including the Burin facility, will be 60 per cent owned by FPI, 40 per cent owned by the Income Trust, with FPI having the right to elect six out of the seven directors of the American company as long as it maintains an economic interest in that company greater than 10 per cent.

When the transaction is completed, we will then have FPI owning the Primary Group here in Canada and owning 60 per cent of the American operation, and the Income Trust owning the other 40 per cent of the American operation. There will be a continuing connection between the two companies. The first one, of course, is that FPI will, in fact, own the 60 per cent economic interest in the American operation. Secondly, they will exercise some degree of control insofar as FPI will have the right to elect six out of the seven directors of the board of OCI, although it is important to point out that while FPI will have the right to elect these directors, the directors will be independent. The fiduciary duties that will be owed by the directors, the duty of care that will be owed by the directors, will not be to FPI. The directors, under Delaware law, will be independent of FPI. They will be non-residents of Canada. Their fiduciary duties and their obligations will be to the new company, OCI, and not to FPI.

Another element that will maintain a connection between the two companies is the marketing agreement between FPI and OCI. This marketing agreement will grant to OCI, or FPI will grant to OCI, the exclusive right to distribute and market commodity seafood in North America. FPI will pay OCI a commission and FPI will sell to OCI all commodity seafood which OCI uses to manufacture its value-added product. That means that all seafood that the American operation will use in its value-added business will all come from FPI. That will be a strong connection between the two companies.

Both companies have agreed not to compete in their traditional markets inside and outside North America.

FPI will continue to manage the marketing for Atlantic Queen Seafoods Inc and Ocean Choice, PEI Inc.

The marketing agreement, therefore, ensures a long-term arrangement whereby FPI has a guaranteed customer for some of its product and OCI US maintains a source of supply to maintain its value-added business.

Also, as part of the continuing FPI OCI relationship there will be a Services Agreement which is another contract which will provide a link between the two companies. My understanding is that under this agreement FPI will provide administrative, financial, human resource and support services to the American group. FPI will provide services which include regulatory compliance, investor relations, tax information and ongoing corporate services. All information technology work for the American outfit will be done from FPI headquarters in St. John's and fees will be negotiated and charged, of course, for these services.

FPI's starting proposal was presented to government for information purposes. When FPI decided that it was in its economic interest to raise funds through the Income Proposal, FPI brought the proposal to government for information purposes on the premise that it was consistent with the FPI Act. FPI indicated this proposal is beneficial to the company and to the Province. FPI indicated that it would use some of the proceeds to pay $30 million down on its long-term debt, but beyond that there were no binding commitments or safeguards advanced at that stage.

Government's assessment of the proposal was that there was a certain amount of legal uncertainty as to whether the Income Trust Proposal was, in fact, permitted under the FPI Act. As indicated earlier, under section 7 of the Act, FPI cannot dispose of all or substantially all of its property or its business that relate to the marketing and the harvesting and the processing of seafood. Government's assessment was that there was legal uncertainty. Therefore, government felt that recourse to the House of Assembly was deemed to be necessary, but only if FPI were prepared to make commitments to safeguard the interests of communities and workers and to secure the long-term health of the company on the Province. Government therefore entered into discussions with FPI, and these discussions went on over the past year. These commitments, these proposals - FPI, first of all, came to the government with a series of proposals which were rejected by government. Subsequently, FPI came to the government with additional proposals which were rejected by the government, but FPI has now come with a package of proposals that are before this House and government, that it had spent a lot of time - and FPI had indicated that that was as far as it was prepared to go - so government felt it was time to come to the House. But, even with that decision made, changes still took place. Yesterday morning we heard that there had been changes with respect to decision making in Burin, and also in Fortune.

I further understand, Mr. Speaker, that while I happened to be speaking with Mr. Bill Rowe on his radio show yesterday, additional discussions were taking place by the Premier - as the Premier earlier outlined today - the Minister of Fisheries and Aquaculture, and also the Minister of Innovation, Trade and Rural Development to seek further commitments that would be beneficial and would provide some protection for the people of Harbour Breton.

Mr. Speaker, in the proposals, as I indicated earlier, the proposals indicate that FPI will have certain controls over its U.S. operation. FPI will not relinquish its ability to appoint the Board of OCI U.S. without the consent of the Minister of Fisheries and Aquaculture in this Province or his successor. FPI will not be able to permit its interest in the Income Trust to fall below 10 per cent and lose control of their right to elect a Board of Directors of the American operation without the consent of the minister. If FPI should lose that control, then FPI would be in default under the agreement.

FPI will obtain a commitment - as I mentioned during Question Period - from its significant shareholders, Sanford and Clearwater, that they will not acquire more than 15 per cent of the units of the Income Trust or the limited partnership or the general partnership that will manage the limited partnership.

As I indicated earlier, FPI will continue to have a marketing relationship with the American company, which will last for seven years and can be renewed at the option of FPI for a further seven years. Also, the Chair of FPI in St. John's, Newfoundland will, in fact, become the chair of the board of the American company as well.

There are also commitments made with respect to the distribution of the money. When the deal is completed, Mr. Speaker, FPI will continue to own its processing operations in Newfoundland and Labrador but will have somewhere between $75 million and $100 million, depending on how the Income Trust does in the American capital markets. Commitments were obtained about how the $100 million will be spent. Originally, FPI's proposal was that it will pay down $30 million of its debt. That commitment will continue and that will make the company stronger. It will make its balance sheet stronger and that will protect the primary operations.

Government was concerned that the monies received on the Income Trust not all be distributed in dividends to the shareholders or by other means but stay in the company to strengthen its balance sheet and to fund future growth and expansion. To do this, FPI made a commitment, as I said, to pay down $30 million on its Newfoundland and Labrador debt. There were a series of commitments to ensure that the balance of the $70 million cannot be dissipated through extraordinary dividends.

FPI indicated that, for the next two years, it would not pay dividends of more than fifty cents a share. I believe that amounts to $7.5 million a year for the next two years, but thereafter the company has committed to base its dividend policy on its historic dividend policy which, I believe, was an average dividend of about twenty cents a year. In addition, the company pledged that there would be no extraordinary dividend so that the money, apart from a reasonable dividend, would not be paid out to the shareholders but would remain in the company for expansion and growth. In addition, not only did FPI agree to spend $30 million to pay down its debt, it agreed to enter into a debt equity ratio or to maintain a debt equity ratio, subsequently, to ensure that the debt would not be increased after it had been paid down.

One major commitment that has been given, which should be mentioned, is the fact that FPI has committed to operate the current plants for five years, subject to resource availability and economic viability.

Now, is this perfect? As the Premier indicated today, it is not perfect, Mr. Speaker, but it is a lot better than what we have now because right now any company, including FPI, if it wishes to shut down a plant or shut down a division, has the absolute right to do so, provided it gives the necessary notice. At least under this proposal, FPI is agreeing that we will continue to operate the plants unless there is no resource availability or the company is not economically viable. When we say: well, what difference? That is no different from the current situation. But it is, because if government challenges that the matter will go to an arbitrator and the matter can be arbitrated and then FPI is wrong. If the company is, in fact, or if the plant is, in fact, economically viable, then FPI will have an obligation to keep that plant operational. If they fail to do so, they will forfeit their quotas.

FPI has agreed to invest $8 million to expand secondary production in Fortune on the Burin Peninsula. The original proposal was that the investment will be made on the Burin Peninsula but now, heard yesterday, that there has been an agreement with the union, this investment will take place in Fortune. This is an $8 million secondary production. Four million dollars will be invested over the next three years to integrate information technology in fish plant operations. That will help modernize the operations.

With respect to Harbour Breton; as of yesterday, or at least as of yesterday morning, the commitment of the company with respect to Harbour Breton was to provide $3 million and to turn the plant over to the community, with the exception of the redline. As the Premier mentioned today - something that I was not aware of when I was taking part on an Open Line show yesterday - discussions were taking place and they continue to take place between the government and the company and the people of Harbour Breton. I see the Minister of Innovation, Trade and Rural Development nodding, and those discussions are going on and continuing new efforts to seek a quota for the people of Harbour Breton.

I must say, Mr. Speaker, that since we started this transaction, since FPI first came to the government with its proposal some time ago, that the information has, of course, been changing. The information in the prospectus has been changing. There were changes as late as yesterday morning and there could be, of course, further changes. Indeed, the final form of the contract that will be entered into between the government and the company will be subject to the government's approval of the final form of the prospectus and the final form of the material contracts that were linked to this agreement.

There will be a $1 million investment into research and development with matching funds from government. There will be employment for Fortune workers at Marystown, providing income support for displaced workers and designation of Fortune as a new secondary processing operation. In Bonavista, the plant will be replaced with a new facility.

One major commitment made by the company is that all groundfish will be landed in the Province and all successors to FPI will be bound by that commitment. I understand that is a major new initiative, where the company has agreed that all groundfish will be landed and processed in the Province.

Mr. Speaker, if the commitments are not met, what is the default? What are the consequences of default by the company? The company has agreed that if they fail to honour the commitments that they will forfeit to the Newfoundland government - or the Government of Newfoundland and Labrador, I should say - that they will forfeit their enterprise allocations or quotas and their vessel designations. These would be serious consequences for the company. The enterprise allocations or quotas will revert to the government, subject, of course, to the approval of the federal Minister of Fisheries and Oceans. I understand that a briefing of the federal minister has taken place and we will await the federal minister's decision in due course.

The quotas, of course - if there is default, Mr. Speaker, there will be a period of mediation and a period of arbitration to see if the default can be corrected. If not, the quotas will become the property of the Government of Newfoundland and Labrador, which will agree to lease the quotas back to the company so that the plants can continue to operate. If there is growth in those quotas - well, I should say that the original quotas that are in existence at the time will be leased back to the company, at the cost of maintaining the quotas without any increase in the growth in the quota, will also be leased back by the government to the company but at fair market value. That is enough quota to enable the company to provide full employment. Any quotas beyond that threshold would be the sole property of the Government of Newfoundland and Labrador to sell, to lease and do so as it pleases.

Mr. Speaker, the two legislative changes that are contained in this bill, Bill 41, today to amend the act, if supported the amendments to the act will permit the Income Trust to proceed. As I indicated, there was some uncertainty as to whether or not this transaction could not proceed because of section 7 of the act. The first part of the amendment is to ensure that if it meets with the approval of the members of this House, that this transaction can go ahead. That is why we are here. The real issue is not whether our legal opinions were telling us that section 7 prevented the transaction from going ahead, but whether it is the will of the people of this House, as the elected representatives of the people of the Province, is whether we feel this transaction is in the best interest of the Province.

Mr. Speaker, we look forward to an informative debate where all members have time and opportunity to discuss the transaction, the Income Trust and the proposed amendments. We look forward to an open and responsible vote that will help strike a balance between allowing FPI room to grow, on the one hand, and looking out for the best interests of the fish plants and the workers in the communities on the other.

If FPI's proposal does, in fact, reach approval in the House, FPI, as I said earlier, will enter into a contract with the Government of Newfoundland and Labrador that provides the commitments that I have outlined, and any future commitments that might come about.

FPI and the government would commence negotiations to transform the term sheet into a binding contract. This process will take some time and not be completed until the government is satisfied with the final form of the contract and with the final form of the Income Trust Transaction, including the final form of the Prospectus which we, of course, have yet to see, and the final form of other material contracts including the exchange agreement and the marketing agreement, the shareholders' agreement, and all other relevant agreements.

At that stage, provided a contract is reached on terms agreeable to the government and FPI, the bill would then be proclaimed into law. FPI would then file its Prospectus to start the process it needs to follow.

Mr. Speaker, this is a significant issue for the people of Newfoundland and Labrador. It is significant to the interests of people in rural Newfoundland and Labrador. It is significant to a company that this Legislature established to be a flagship for the fishing industry in this Province, and I am certainly looking forward to the debate and the comments from all members of this hon. House.

Thank you, Mr. Speaker.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER (Fitzgerald): Order, please!

The hon. the Opposition House Leader.

MR. PARSONS: Thank you, Mr. Speaker.

I appreciate an opportunity to have a few words regarding Bill 41, which has been put forth here by the government, concerning the FPI transaction. Albeit I do not have any particular FPI interest in my political or electoral district, of course, this is a matter of concern to everybody in the Province irregardless of where you might live.

I appreciate the minister's comments as to the background concerning this matter. Our purpose here in the next two days, as I understand it, is to ask questions, if there is something we do not understand, to flesh out some background as to what the commitments that we are aware of mean. Are they open to interpretation? If so, what are the interpretations? What, if anything, can we do to improve it, even? That is why the amendment provisions have been provided here, because the Premier has indicated that this is not a done deal. This is a proposition put forward by FPI, and if members here have anything to say in terms of what they feel might be necessary to improve it, we ought to be able to do that. I would think in the course of the next two days of debate we are going to be seeing some ideas coming forth from all members of this House that would improve this deal.

I think the tenor of my conversations will relate to the balance aspect. The minister said in his press release on this thing - and I quote him - "...a careful balance must be struck between the ability to sustain a viable and competitive business, and the long-term interests of Newfoundland and Labrador."

I agree. I think that is what it is all about. I commend government for what they have done so far in keeping the feet of FPI to the fire to at least get some commitments because, from where we started, obviously, a year ago, or over a year ago, to where we are now - FPI, the closer you put their feet to the fire, the more they cough up, it seems. In fact, they have coughed up a fair bit this week, since Monday when the things were announced, vis-B-vis the announcements on Bonavista which have come forward. We have the announcements on Fortune, and the fact that there will be no negative effects on what is happening in Fortune on Burin. That is great stuff, and it has all happened within the last seventy-two hours, so I think we are dealing with a moving target here. The deal is not final, so I think anything that we say in the next two days lets FPI know that you have not finished negotiations and you may well have to put some more things and commitments on the table in order to get this deal done by the members of this House.

For example, we have the Harbour Breton situation. I do not think for a minute that FPI should think that the negotiations and discussions are over on Harbour Breton, not by a long shot. I think the Premier made that quite clear. I think that if the behind-the-scenes and out-in-front discussions in the next two or three days bring FPI to their senses and does something for Harbour Breton, the likelihood of this Bill 41 getting recognition positively by members of this House would be much more likely, I would suggest.

I have no problem, by the way; the FPI Act in its current form is there to protect the interests of the people of this Province. We all know the history on FPI. It came about when a number of companies in the Province got in trouble. They put it together as one massive outfit; the flagship, they called it, of the fishing industry. The provincial and the federal governments threw in a lot of money and we tried to put in some terms and conditions to protect the people of this Province because we considered it to be a very valuable asset, if not the most valuable asset, in our fishing industry.

We also have to recognize, as the government has done, I believe, that we also have private shareholders who have taken their money and put into this company. They want to make a profit, and so they should make a profit, but where do they find the balance between what the shareholders want and deserve - for example, to get some return on their investment - and the fact that we have the interests of the people to protect?

My first preliminary read of this documentation, three or four days ago, and I have read it several times since and had briefings and so on, I am still left with the conclusion that it does not go far enough. I think we have to keep their feet to the fire. This is not about trust. You hear people saying: Well, we cannot trust FPI. They tell you one thing two years ago and they are going to do something else now, or they never delivered on that. We cannot trust them.

I would deal with this in normal negotiations. To use an analogy, I think the government in this case is the bank, and FPI is the borrower. When you deal with a bank, it is not about trust. The bank looks at you, sizes you up, sees what the likelihood is that you are going to pay back your debt, looks at your previous credit rating, probably, and your payment history, but the bottom line is, the bank says: Yes, Mr. Parsons, we will lend you the money that you are looking for, or will allow you to do such-and-such, but we want some security back.

This is, I think, where this agreement falls short, in the security end of things. I asked the Premier a question here this morning about: Did we ask FPI for security vis-B-vis the offshore quotas? The Minister of Fisheries and Aquaculture responded, and I took it to mean that you had not asked for it, and the reason he had not asked for it, he suggested, was because: Well, it was not of much value anyway.

My suggestion would be, it is not relevant what the value is or is not of their offshore quotas or of their dragger fleet. If FPI wants to do what they want to do vis-B-vis the Income Trust, which I have no problem with allowing them to go ahead with this Income Trust thing; let's deal with it from a proper security perspective and say: Thank you very much, FPI - but, like the guy who is building a home - we will let you do what you want to do, and go ahead and build your home, but if you do not make your payments and if you do not keep your commitments, we are taking your home back. We are going to seize that home from you, the same as anybody else who has a mortgage, and we are going to sell it.

Instead of that, we have an agreement here which to me appears to be saying: Yes, we are going to go let you build that home. Yes, we will give you the money to go do it, and the authority to go do it, but as security back we are only going to take a mortgage over your shed - for example, your groundfish quota.

I am suggesting here that we ought to keep their feet to the fire. Never mind them saying: Well, you do not need the offshore quotas or a dragger fleet because that may not be relevant or it may not be valuable, or we might get it offshore and sell it off in Europe and it never creates jobs here in the Province of Newfoundland and Labrador. That is irrelevant. If they want to do what they claim they need to do here, why shouldn't we hold their feet to the fire and say: That is your call, FPI. We are prepared fully to back you in what you want to do, and look after your shareholders and go for this Income Trust, but we want full, absolute, security over everything you own. We just do not want your shed or your outhouse as security if you do not keep your deal. This is not about trust, this is about security, and fess up and put your securities on the line, the same as you would ask anybody else who is going to do it.

It is great for FPI to say: We are going to put a new plant in Bonavista. It is great to say that they are going to put a secondary processing facility in Fortune. That is great stuff and it is good negotiations that that is put in the agreement, but what happens if they do not deliver? Those are the same kinds of questions that came up with Voisey's Bay. What do we do if they do not bring back the mineral or the concentrate? That is what it was all about, putting in the protections if somebody does not keep up their end of the bargain.

You look at this documentation, they are giving you groundfish. I do not know if anybody else here has listened to the media in the last two years, and I am sure you have and you have heard Derrick Rowe, the CEO of FPI, say publicly, that the most valuable piece of FPI is the shellfish operations and their marketing arm. Now, if we are going to give them permission, by doing this here, to dilute their marketing arm by way of an Income Trust, and if we are not going to take their shellfish quotas as security, we have only tacked our security to the least value piece of FPI, the groundfish quota. According to what I heard Mr. Rowe said: In five, six years or ten years out, FPI may only be an offshore quota operation in the marketing interest anyway. What is the point in protecting ourselves with groundfish if even the CEO of FPI today believes that the groundfish piece is the least value piece that it has.

I think we are missing here on the security, and I would urge this government to say, yes, you want to do Income Trust, by all means let's take Bill 41 and do it, but you are going to put on the table for us the security that the people of this Province deserve. You do not play ball - we have given your investors and shareholders a chance to go off, and if you make billions of dollars by doing this Income Trust, and you make this a viable, efficient world-class company, go for it and we will back you in it. If you do not, you pay the piper, and you are paying the piper by giving back to this Province what we set up and created for you in the first place, i.e. the company, not just a piece of the company, the company. I think that is a very fair and reasonable request to put to FPI.

I have some concerns here. The minister made a comment, for example, about 40 per cent, and he said it here again today. This Income Trust that they are going to set up, they are going to sell off 40 per cent. Words are important again. It is the initial offering of the market value-added wing of FPI, and the people of the Province have to understand that. We are not just saying here to FPI, by changing this act now: Go off and we are going to allow you to create an Income Trust of which you can sell 40 per cent, of which you can then raise about $100 million to go and grow the business. This agreement, as I read it here - and I would like to be corrected and I hope I can be corrected - this amendment will permit, once this Income Trust gets rolling, FPI to sell 100 per cent of the Income Trust. That, in fact, is why the word initial is being used.

We have to realize that we are not dealing here with a 40 per cent sell off of an Income Trust. Yes we may still retain control in terms of the Board of Directors, but let's not kid ourselves. Right now, in this box, we have a company called FPI and a number of subsidiaries; FPI Limited and so on, FPI Inc., and Ocean Cuisine. The bottom line is, in that box, that big box, of the 100 per cent of it about 65 per cent of it is the marketing and value-added wing and the primary processing is about 35 per cent based on last year's financial statements. What we are saying here is: We are allowing you, by this move, to take that 65 per cent that you have and ultimately it could come under the control, 100 per cent, of anybody in this world, whether they be Icelanders or whether they be partially John Risley or some guy down in Africa. The bottom line is, it is not controlled by us. That has to be made clear to the people, that it is 100 per cent here.

The question I raise again is - and the Premier used the words today in Question Period, and this is what I keep coming back to and I think FPI has to understand this. The Premier said: We have to deal with them in good faith. I agree with that absolutely, but I would also say to the Premier: Every legal contract that I have ever been a party too or witnessed, all parties start out and sign those agreements in good faith but we have a lot of courts in this country that operate because somebody did not keep the faith. We keep judges going in this country big time. All I am saying is: Albeit the government is doing everything in good faith and we take the principles of FPI on their face and at good faith, we need that security provision there. Never mind we might do this or we might do that. Thank you, you give it your best efforts, but if you screw up you have to realize that we get what you have, not a piece of it, we get the whole lock, stock and barrel. You investors by the way, who now stand a chance to make some money and return on your investment by us allowing this Income Trust, you only ever got to invest in this company called FPI because it was a creation of governments and the interests of the people of this Province in the first place. You would only be taking back to the people what was rightfully theirs from the beginning. Good faith can only go so far, and we have to iron clad the good faith piece, I would suggest, by putting in the security provisions here. I think there is no better time than the present. They say the Premier likes to drive a tough bargain and get a good deal, I am a firm believer that you ought to as well, particularly in this case.

I say - pardon the language, with all due respect to the principles of FPI and the shareholders of FPI who I want to see make billions of dollars, they should, and we are prepared to let them do it with this Income Trust - be damned if you do not give us the security that we need. If that is the choice we have to make as the people of this Province, we are prepared to recognize market circumstances, we are prepared to give you the permission to go do what you have to do, but that is where it ends. You have to show your good faith by putting your money where your mouth is too. If you cannot cut it with your Income Trust provision down the road, and you lose control of it or you do not make the money that you wanted, we have done our part then, but do not come back and tell us that we are not having what we were a party to, i.e. all of the interests of FPI. That needs to be done.

The Minister of Fisheries and Aquaculture this morning - these are worrisome words to the people of this Province. When you start saying we have no guarantees, we have some commitments, we have some safeguards - those were his words. We can have more than safeguards and now is the time to do it. There is no time like the present. I do not say just put your feet to the fire, I say put your feet in the fire. Deliver or else! They have the ability to do that within the next two days or no member of this House, in his or her right mind, should support this agreement because the security is not there.

Let's not confuse what is security with what it is they are trying to do. Nobody here is saying they should not do this. Do not interpret my comments here to say that FPI should not be permitted to go and establish an Income Trust. Absolutely not! They ought to be allowed to do that. I encourage them to do that, because I accept their words that they need the investment to make it a world-class company. Absolutely! I accept their commitment that they want to make investments in infrastructure in Bonavista and Fortune and in this Province, which is going to create good jobs and particularly in rural Newfoundland. When I say I support you in all of that, you have to have a level head and a sensible mind, I think, too, and request the necessary securities. I am taking a chance on you FPI. Since the 1980's we have covered you. We have controlled you and now we are prepared to cut that loose. We are going to cut you some slack, but there has to be a fair deal on both sides, and right now we are not fair in this deal because the security is missing.

I notice, too, and I am concerned, the Minister of Justice, in his comments here this morning, says - and this ties into the security piece again, they are saying - we are going to get the groundfish quotas, and there have been approaches made to the federal Minister of Fisheries and we await the outcome of those talks.

I say to the Minister of Fisheries, that isn't good enough for me, again from a security perspective, because what is the point of having an agreement between FPI and this Province saying that if we do not deliver on our commitments we are going to give you even our groundfish quotas, if we do not have a commitment from the federal minister and the federal government that, yes, we are going to make that happen? So, that is an absolutely necessary piece that has to be put into this before it is finally concluded. That has to be there.

I notice, too, we talk about, I call this the backup plan.

AN HON. MEMBER: (Inaudible).

MR. PARSONS: We only have two minutes left.

I will not get into the full details on it, but the Premier says yes, we have to do something. I agree, we have to do something, but if they do not give the commitments that we need, the further commitments on Harbour Breton, if they do not give the further commitments on pledging their dragger fleet and their offshore quotas and virtually everything they own, my view is that we do not have the proper securities; and, we have to have the federal minister clued in.

The other question I would ask is, I feel somewhat in the dark by debating this in a two-day session, with all of these unknowns, and we have a process whereby when we leave here and vote on this tomorrow we are all going to go home and the government officials and the ministers go off and continue these negotiations to flesh out this proposal, dot the i's and cross the t's and whatever, but this is never coming back to the members of the House again.

We are being asked to vote on this in principle, based upon what we have seen - and, as I have said, there are some big, big, loopholes here, particularly from a security point of view - and we are going to have all of this gone off and negotiated, and once the government feels that we have now finalized a, b, c, d, e, f, g commitments, based upon the votes and so on, we are going to sign the deal and proclaim the act at that time, proclaim the amendments. The members of this House will never get to see again what the final agreements were.

We had questions raised in Voisey's Bay, very legitimate questions, by the Opposition: Will we see the final binding agreement? Is this the final binding agreement? Ladies and gentlemen, in Voisey's it was. We dealt with it by way of resolution. The deal was put together. The i's were dotted and the t's were crossed, and we came into the House and said: There it is. There is the package - for it or against it.

That is not what we have here. We have the parameters of a term sheet which has to be negotiated in more detail, and my concern is that we, the people of Newfoundland - for example, through their MHAs - are not going to get an opportunity to see that final deal anymore. That is why it is even more incumbent upon government to be very careful about what ends up in those final agreements. That is why it is very important again that we need the security provisions in those contracts.

Those are my preliminary comments on this matter. I think it falls short. I commend government for what they have done in terms of the commitments they have gotten. It is a great start. It is a good ways down the road, no question; but, ladies and gentlemen, it is not good enough. Because, if what you have negotiated is not secure, what is the point of it? We can have all the paper we want, and all the contracts we want, if we do not hold a hammer to enforce it.

Great for Harbour Breton, great for Grand Bank, great for those places, but if it is not worth the paper it is written on from a security point of view, why are we doing it? There is only person, one group, that can give us that security. That is FPI, and I think we have an obligation to insist, yes, you get what you want, but you have to give us the protection that we need. If we do not ever have to use it, that is fine. If you go off and become the best fish company in the world, and make billions of dollars for your shareholders, go for it, but we cannot risk the possibility, by allowing you to do this, that we ultimately could end up losing the whole ball of wax that we have here, which is so beneficial to our Province.

Thank you, Mr. Speaker.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: Order, please!

The hon. the Minister of Fisheries and Aquaculture.

SOME HON. MEMBERS: Hear, hear!

MR. TAYLOR: Thank you, Mr. Speaker.

I am glad to have an opportunity this afternoon, or this morning, I guess it is - I am used to saying this afternoon; it is odd being in here in the morning - to say a few words on Bill 41, An Act To Amend The Fishery Products International Limited Act, and the proposal that we have in front of us from Fishery Products International as it relates to various undertakings and commitments related to their Newfoundland and Labrador-based operations, and what they might do with their Income Trust transaction and their Ocean Cuisine International operations in the U.S.; how they might use proceeds from the sale of - as the Opposition House Leader said, from the initial offering, the initial sale of units in the Income Trust, which would see 40 per cent of the value of Ocean Cuisine International, what was formerly known as the marketing value-added arm, being offered through an Income Trust transaction, and he is right. That is potentially only the beginning of what would be a dilution of ownership by FPI in its marketing value-added arm, Ocean Cuisine International.

Quite clearly, and it has to be acknowledged and it has to be understood by everybody in this House and everybody in Newfoundland and Labrador, what we are talking about here now is not about FPI selling 40 per cent of Ocean Cuisine International. The Income Trust potentially will not own just 40 per cent of Ocean Cuisine International. It will own 40 per cent of Ocean Cuisine International initially. Then, as transactions take place, as they decide to offer more units, as they may decide through mergers and acquisitions of other bodies in the U.S., potentially, then, of course, the ownership of Ocean Cuisine International by FPI would become diluted beyond the 40 per cent. They can go down as low as 10 per cent and still retain the ability to appoint six of the seven directors on the board of directors of the Income Trust; however, it has to be understood - and the Opposition House Leader raised a good point, and certainly I think that was laid out there before but it bears reinforcing and reminding here today - that is what we are talking about.

Mr. Speaker, I know there is lots of speculation ongoing in the Province today, especially in media circles, and I would assume over on O'Leary Avenue, about how this vote is going to end up some time tomorrow, by tomorrow night. I would not put a lot of money on what way the vote will end up.

I said over the past forty-eight hours, I guess, where my leaning was; however, there is a lot of debate that will take place here for the remainder of this day and for tomorrow, a great deal of debate, and there will be a great deal of legitimate questions asked. There will be a number of answers provided to the extent that we can; however, it bears again reminding that this is not a government proposal. This is not a government position. This is not government advocating on behalf of a bill. This is government laying in front of the people of the Province what we have been able to negotiate thus far with FPI, on behalf of the people of Newfoundland and Labrador, certain undertakings as it relates to certain communities; Harbour Breton being one with a $3 million commitment thus far. Is that enough to get the support of this House? I do not know. I suspect it is not enough to get the support of quite a number of people in this House for this overall proposal. It is not enough to get the support, I do not think, of the Member for Fortune Bay-Cape la Hune and some of his colleagues. I am pretty sure it is not enough to get the support of some members on this side of the House. What is enough? That, only time can tell. Is FPI able to come up with it all? I do not know. Certainly, an $8 million contribution, an $8 million investment on the Burin Peninsula, in Fortune, for a new secondary processing facility, Mr. Speaker, I would think that would be good news for the Burin Peninsula and good news for Newfoundland and Labrador. Again, Mr. Speaker, is that enough to get the support that FPI requires in this House to amend the FPI Act to see this proposal go forward? Again, I do not know. It is very difficult to say.

Mr. Speaker, I just want to speak about where we have come from. Fourteen months ago, as the Premier said earlier today and a number of us have said, we were informed, by way of a briefing, I was informed by way of a briefing, and my Deputy Minister, of FPI's intention to proceed with an Income Trust offer to the establishment of an Income Trust. Mr. Speaker, at that time we were informed that they wanted to pay down some of their long-term debt; some, there was no figure put on that. I do not recall that there was anyway, at the time. The rest of the proceeds, as I recall, would be used as FPI determined, as FPI saw fit, to expand its operation.

As the Minister of Justice and Attorney General said earlier today, we were informed that this was a good move for the company, that it would be good for the people, the industry, the company in Newfoundland and Labrador, their operations and their workers in Newfoundland and Labrador. Mr. Speaker, that may well have been. However, government, at the time, and for quite some time, felt that there were a number of commitments that FPI needed to make to the people of this Province as it related, specifically, Mr. Speaker, to the disbursement of funds from this Income Trust transaction. They anticipated that they would raise $100 million, and the question became, really: What does $100 million mean to the fishing industry in Newfoundland and Labrador? What does $100 million to the people of Newfoundland and Labrador? We want to see what your commitment is to your primary operations in Newfoundland and Labrador. We want to see what your commitment is to ensuring that the $100 million is actually spent on growing the business, Mr. Speaker. Certainly, I am sure there are a lot of people and we try to deal in good faith. As the Opposition House Leader said earlier, you can deal in good faith, but you have to protect yourself against all possibilities also, or as many of them as you can.

Mr. Speaker, there was a recognition, rightly or wrongly, that we needed to, to the extent that we could, ensure that the money was spent on operations to grow the company, to invest in infrastructure and opportunities in Newfoundland and Labrador, and to ensure that this money did not end up in shareholders' pockets, for lack of a better way of putting it. It is just as well to be Jack Blunt about it. This money did not end up in shareholders' pockets, through dividend payments, extraordinary dividend payments, and what have you. This was just not a way of raising money to reward current shareholders of FPI.

Mr. Speaker, have we done a satisfactory job of that? Well, only time will tell. There is a lot more protection there now than there was fourteen months ago. Again, is it enough, Mr. Speaker? I listened to the Leader of the Opposition and the Opposition House Leader concerned about my comments and the Premier's comments earlier today, about there are no guarantees. No, Mr. Speaker, there are no guarantees. There is no point in us standing here today and saying this is ironclad, that under no circumstances can we foresee how there will not be an investment on the Burin Peninsula -

MR. SPEAKER: Order, please!

If the Chair could just interrupt the hon. Minister of Fisheries and Aquaculture for one moment. The Chair would like to recognize twenty-four Grade VIII students who are attending and visiting the Legislature today from New World Island Academy and the Grade VIII students are accompanied by their teachers, Dean Kinden, Marie Pourier, chaperone, Barbara Burt, and bus driver, Lew Shea.

Welcome to the House of Assembly.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: I thank the minister for allowing me to make that introduction. I call on the Minister of Fisheries and Aquaculture to continue his debate.

MR. TAYLOR: Thank you, Mr. Speaker. You are the Chair.

As I was saying, it would be foolish, on anybody's part, to stand up to try and say that there are ironclad guarantees. Do we believe that we have made some gains? Yes, absolutely, we do. Is it enough to ensure that FPI becomes the prosperous company that we hope it will be? Are we sure that FPI and its Newfoundland and Labrador operations can grow? No, Mr. Speaker, we are not sure of that, because there are too many variables out there aside from anything that anybody might do that would be untoward. There are too many variables in the international market, there are too many variables in resource bases, there are too many variables in currency exchange rates, to be able to assure anybody that FPI is going to be the flagship company of Newfoundland and Labrador in five year's time or ten year's time or twenty year's time.

Mr. Speaker, what we have tried to do is to put stipulations in place to protect the people in Newfoundland and Labrador should anything untoward happen, whether purposely or accidentally. That is what we have tried to do. Only the people of the Province, through their representatives in this Legislature, can determine whether or not we have done an adequate job of that, and whether we are prepared to take the chance with FPI's proposal that we have in front of us today, whether we are prepared, as the Opposition House Leader said , whether we are prepared - excuse me. This little cold I have in my head is affecting my tongue.

MR. REID: Good.

MR. TAYLOR: Good, says the Leader of the Opposition. Yes, I am sure there are a lot of people who share that sentiment.

Mr. Speaker, we have to ask whether we are prepared to take the chance with FPI, prepared to take the chance on the Income Trust Transaction, and see if this company can grow. I think most people in this House recognize that FPI is hamstrung, FPI is restricted in its ability to be able to raise the kind of funds that it needs to grow its operations, particularly its marketing based operations in the U.S., for example, and in Europe. It is burdened with quite a substantial amount of debt. With the 15 per cent share ownership restriction that the company has on it, certainly it does not have the same latitude that other publicly-traded companies have when trying to raise capital. Mr. Speaker, I think we all recognize that.

The question is: Are we prepared to allow them to go forward with the proposal that they have in front of us based on the undertakings that they have provided to government over the course of fourteen months of negotiations? That, Mr. Speaker, is a question that each individual will have to ask themselves. We have to recognize that the industry is changing. The industry in Newfoundland and Labrador is changing. The industry worldwide is changing. We can only try and look ahead five to ten years, try and look ahead and see how we want our industry positioned and see what we can do as a government, whether we are in Opposition or government members, to see how our actions can effect change in the industry so that our industry is able to be competitive globally. I guess that, in a nutshell, is what we are trying to do here today.

While it is a little odd to be debating a private company in a House of Assembly and a House of government, such as we are here today, nevertheless we are doing it. We do not have this same kind of debate, I suggest to all members, about Quinlan Brothers. We do not have this same kind of debate about Breakwater Fisheries or Notre Dame Fisheries or Barry's or any number of fishing enterprises around Newfoundland and Labrador. When we try to apply restrictions to those companies, we have to do it in a manner that is consistent with all other fishing enterprises in the Province. FPI is the only creature in the fishing industry in Newfoundland and Labrador that has the distinction of being held accountable in the House of Assembly to the extent that they have been and are again today. Mr. Speaker, we have to recognize that.

I think, Mr. Speaker, when we - as I said in debate and in Question Period over the past number of months as it related to FPI on other matters, the Government of Newfoundland and Labrador, whoever that government might be, has quite a sledgehammer that it can, on some occasions, hold over - quite a powerful tool - the FPI Act. But, like a gun, when you have a powerful tool you have to be responsible in your use of that powerful tool. I believe that we have to be responsible and we have to be diligent in our use of the FPI Act. We have to recognize that the company needs to grow but we also have to recognize, and the company has to recognize, that it has very serious and very strong obligations to the people in Newfoundland and Labrador. It was a creation of the Government of Newfoundland and Labrador and the Government of Canada when the fishery was restructured in 1983-1984. When the company was subsequently privatized in 1987, there was a significant amount of public sector funds that were left in FPI to enable them to be the company that they are today. There is a responsibility, whether they like it or not, that is associated with that.

Mr. Speaker, I am not going to speak in any great detail on what has been proposed. I will say to members opposite and members on this side of the House and the general public, that we recognize, as the Opposition House Leader said, that there are a number of issues that have to be dealt with after - assuming, if I can be so bold, should this pass tomorrow, if it should. If it were to pass tomorrow there are a number of things that have to be done. One of the big ones that has to be done is the securing of a commitment from the federal government as it relates to quotas, enterprise allocations related to Fishery Products International. Because, as I have said on numerous occasions - and people remind me of my own words - we have no authority as it relates to allocations of fish. None whatsoever. For that reason, Mr. Speaker, when we started down this road - or I should say when we got to a point where negotiations really started to move forward in earnest, I made contact with the federal Minister of Fisheries and Oceans, Minister Regan, informed him of the deliberations that were ongoing between our government and Fishery Products International, and that there was a possibility of a default clause being negotiated as it related to enterprise allocations of FPI, that at some point, should we conclude an arrangement, we would need a commitment from the federal minister and a commitment that would bind his successors to allocate FPI's enterprise allocations to the Government of Newfoundland and Labrador should there be a default on FPI's part; should there be a failure on FPI's part to live up to the commitments that they have made.

Mr. Speaker, that contact has been made. Minister Regan, at the time - not to put words in his mouth - informed me, to the extent that he could, he would be prepared to co-operate with the Government of Newfoundland and Labrador on that matter. Prior to coming to the House of Assembly this morning, since this thing started to come together over the last couple of days, prior to coming to the House of Assembly there has been a letter from me to Minister Regan reminding him of the conversation that we had and informing him that - depending on how the vote concludes in the next thirty-six hours, I guess - we would need to have a further discussion on that, and we would need his commitment and the commitment of the federal government as it relates to those enterprise allocations.

Of course, Mr. Speaker, I think it has to be stated here - I think it has to be stated here anyway - that the federal government has to come across with that commitment. If the federal government does not come across with that commitment, if there isn't some binding arrangement on the part of the federal government and FPI that is satisfactory to the Government of Newfoundland and Labrador as it relates to their enterprise allocations, then we will not have a hammer to hold over FPI's head. For that reason, Mr. Speaker, I think that the deal - if it passes here - would not be concluded on that basis. So, it is very important for the federal government to remember that, and very important for FPI to remember that regardless of what happens here in the next thirty-six hours, there are still a number of hurdles that FPI and the federal government have to get over.

Mr. Speaker, that, I think, will form the basis of my comments here. I think there are thirty-six hours, or just about thirty-six hours, thirty-four hours left before this is finally concluded, one way or the other. FPI have to understand, I think, that we are a long ways from counting votes at this point. The votes will not be counted. It is not over until it is over. A lot of people have to be convinced to the validity of going forward on this course. There are commitments that have been made and they have been substantial. There are commitments that have to be lived up to. At the end of the day, the people of Newfoundland and Labrador and the Government of Newfoundland and Labrador, the people in this Legislature, will only want to support this transaction and this proposal if it is for the betterment of the fishing industry and the people who depend on the fishing industry in Newfoundland and Labrador.

That, Mr. Speaker, is the basis of my comments. I look forward to the continuing debate. I, for one, and I am sure I speak for everybody on this side of the House, have an open mind as to this issue. While I have said I have my leans, at the end of the day the vote is the only thing that counts, not the leans.

Thank you, Mr. Speaker.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: Order, please!

The hon. the Member for Signal Hill-Quidi Vidi.

MR. HARRIS: Thank you, Mr. Speaker.

I am pleased to have an opportunity to speak on this debate in the House today, and, in fact, also to follow the Minister of Fisheries whose responsibility, although he is not responsible for the act, is responsible for government policy with respect to the fisheries.

Let me first say, Mr. Speaker, that I want to comment on one of his remarks, in that it is odd that we are here today talking about a private corporation. It may be that is the case, but this is not the first time that this private corporation has come before the Legislature of Newfoundland and Labrador. In fact, this corporation was created by the legislation in Newfoundland and Labrador in the Fisheries Restructuring Act in 1983. It was created out of a serious problem of instability in the fishery. There was $254 million of money, most of which was public, that went into the creation of this company. So this is a private company now, an investor owned company, but it is a company that was created by the public for a public purpose.

There were some associations - obviously, there were other people who participated. The Bank of Nova Scotia was a participant because they had a significant debt associated with the member companies that formed FPI when it was started. The Government of Canada was also an equity participant. So, we have a company that had its beginning in a private corporation, and over a period of time changes were made to allow it to come to the position that it is in now, as a function of public policy, to be a 100 per cent investor-owned company; but it is a very particular kind of company, Mr. Speaker, and I have a name for it. I cannot say I invented the name, but I certainly used it in relation to this company. I try to use it many times, especially when we were debating the NEOS proposal here a few years ago, and in the all-party committee which produced some very important changes to the act in 2002, and that is that this is a public purpose private corporation. I think Vic Young, the former CEO, called it a hybrid, and it is a hybrid because it has, first of all, been given access to substantial public resources, and also it is a successor to a public corporation that was established by statute to perform a very important function in Newfoundland and Labrador. I, for one, am very proud of what FPI has been able to accomplish over the years.

You know, we saw many changes in the fishery in Newfoundland and Labrador in the last fifteen or twenty years. The FPI Act, the restructuring act, or the act that allowed the substantial changes in 1987, led to what we had hoped to be a vibrant, viable private corporation, publicly traded. Now, I think the Premier called it a public corporation. It is a publicly traded corporation, but that does not make it a Crown corporation. It is a publicly traded corporation. Its shares are traded in the public.

Within a few years of the so-called privatization of FPI we were hit with the cod moratorium. We were hit as a Province, and we all know the terrible, devastating effect of that on the people of Newfoundland and Labrador, on the cod stock which has yet to recover. That is another issue, a piece of business that is undone, and not enough attention is being paid as to how we are going to rebuild that cod stock. Nevertheless, the company, in the short term, FPI and all the other companies in the Province, and the people of Newfoundland and Labrador, had to try to adjust to the devastating effects of the depletion of the cod stocks and the resulting moratorium.

What happened during that period of time is nothing short of remarkable, Mr. Speaker. During the period after the cod stock collapse and the moratorium, FPI, in fact, survived, and they survived through the good management of the then people in charge, and their board of directors, and whatever guidance they had. They survived by developing that corporation and developing a marketing arm of that corporation by buying warm water shrimp, processing it, marketing it internationally, buying a company in the United States called Clouston Foods, which has now been transmogrified into what they are calling now OCI, but it was the marketing arm of Fishery Products International.

As a Newfoundlander and Labradorian, I was very proud of the success that this flagship company, this flagship fishing company in Newfoundland and Labrador, had obtained in the world markets. I think at one time it was perhaps, certainly, the largest fishing company in Canada, but, not only that, one of the largest players in the marketing of fresh and frozen food on the fishery side in the United States of America, coming from expertise from Newfoundland and Labrador, management expertise, products from here, people here who were developing these products, a tremendous amount of effort made by the human resources of this Province as well as whatever was left of the physical resources of the fishery. That was done, Mr. Speaker, while we had less than 10 per cent of the resource available to FPI to operate in this Province. At the same time, Mr. Speaker, this company made cutbacks. Many communities know - and we talked about Trepassey earlier this morning - the devastating effect of the cod moratorium in their communities, even if they were FPI communities.

One thing happened during that cod moratorium, Mr. Speaker, that is extremely important to the people of Newfoundland and Labrador and to the Government of Newfoundland and Labrador in understanding where this company fits in. That company sought, during this period, to maintain the skills and ability of the fish processing that we had in major communities in Newfoundland and Labrador. They brought resource to the Province for processing. They kept communities alive, even though the operations may have been marginal. They may have been - I do not necessarily need to use the word subsidized, but it is pretty obvious that if you used any economic viability test on a particular operation they may not have operated any operations in Newfoundland and Labrador for very long, but they did that because they believed that it was in the long-term best interests of the shareholders of FPI to maintain these facilities, to maintain that workforce, because we all hoped that the cod moratorium was a temporary thing.

They did that with the kind of dedication and vigilance and ability and aggressiveness and dedication that Vic Young - and I give him full marks for his efforts on behalf of the fishing industry of Newfoundland and Labrador over the many years. The shareholders were relatively patient for a long time. The shares were fluctuating back and forth. At one time, the book value might have been $6 or $7 but they were only trading as $3, so the company was always worth more than the shares were trading for because of the uncertainties, obviously, of the fish market.

As I say, I, as a Newfoundland and Labrador, was proud of that company. I used to go to their annual meetings. I would get an invitation. I would go down to the annual meeting and I would be very pleased to say to the board of directors: Good job that you are doing. I looked at your balance sheet. Your sales are tremendous. You are doing work in other places that is benefitting the fishery in Newfoundland and Labrador, even though we do not have the resource.

I regarded that, and I think we all regarded FPI as a flagship corporation in the fishery, and a valuable resource, a valuable and important company. They had created this marketing arm in the United States that was doing tremendous stuff. It was raising a lot of money. It was making money. It was successful. It was big enough to be a player and to buy up new companies, to successfully engage in the so-called acquisition and mergers business, where they could build their enterprise and build their activity.

Then we came in the late 1990s with a few manoeuvres, and I am going to call them manoeuvres because we all had a reaction to them. The first was what came to be known as the NEOS bid. Many of us remember that debate. I know the Member for Fortune Bay-Cape la Hune was part of that debate. We were concerned about what was happening. It was obviously a very valuable company because two or three big players wanted to take it over and use it for their corporate purposes.

That was a very telling time, Mr. Speaker, because the feeling about this company, this so-called private company, became known. People knew how important it was to their communities, to their region, to the future of Newfoundland and Labrador, and that NEOS takeover bid - which is what it was - was resisted and eventually failed.

That was only round one, because not too long after that came round two, which was another attempt to do what many people thought was round two of the NEOS; when, through a takeover and change of the board of directors, and ultimately the management, took place, many people felt this was, in fact, the same kind of threat to the future of FPI as the NEOS bid. What happened was that they were successful. The new board was successful. The effort to take over the changes was successful. They have changed the Board of Directors. That happened in May of 2001. Many promises were made, Mr. Speaker, in order to bolster the public relations of the people who were running this takeover bid through the stock market. They promised, publicly, commitments to the workers, to the FPI plants, to the government, the most notable of which was not to close any plants or reduce its workforce. Mr. Speaker, what happened? Within eight months of that they made certain changes, announced certain changes; one, to purchase Clearwater Fine Foods, and then a groundfish restructuring plan which was going to have the affect of closing down plants in Newfoundland and Labrador.

It was in that context, Mr. Speaker, that this House of Assembly established a Special Committee which reported on public consultations on the FPI Act. That report was made in February of 2002 by the Committee. The Leader of the Opposition was a member of that Committee, the current Minister of Fisheries was a member of that Committee, the Member for Bay of Islands was a member of that Committee, the Member for Cartwright-L'Anse au Clair was a member of that Committee, you, Your Honour, as the Member for Bonavista South, was a prominent member of that Committee, a former member for Burin-Placentia West, Mary Hodder, was on the Committee, and I served on that Committee. We had extensive consultations and discussions about the important role of FPI and what it was going to do in the communities of Newfoundland and Labrador.

This All-Party Committee, a Select Committee of the House, made a report, as I indicated, in February of 2002, and as a result we made recommendations which were adopted in this House of Assembly, because we understood, from the communities where FPI was active, how important it was and the role that it played. We actually changed the legislation because one of the proposals - they wanted to reduce the ability to protect and control this company, they wanted to increase the shareholding, and any one shareholder could hold more than 15 per cent. We rejected that proposal.

One of the important things that we did was we sought, through legislation, to recognize the importance of this publicly-held, private corporation that had, we believed, and still believe, a public purpose. We changed the Act by inserting what is called a purpose clause. We changed the FPI Act, the Fishery Products International Limited Act, to add a purpose clause which said that the purpose of the Act is, "(a) to recognize the fundamental role that the fishing industry plays in Newfoundland and Labrador." That may be a motherhood statement, Mr. Speaker, but lets face it, that is the whole raison d'Ltre for our living in this place from the beginning 500 years ago. The fundamental role that the fishing industry plays in Newfoundland and Labrador is in fact a linchpin to what Fishery Products International is all about and the expectations that we have for this company.

The second purpose clause was, "(b) to continue the company as a widely held company that can act as a flagship for the industry whose objective is the growth and strengthening of the fishery of the province." Now, that says a lot of things, Mr. Speaker. We want to ensure that this company has, as its focus, the growth and strengthening of the fishery of Newfoundland and Labrador. It is in all of our interests for this company to succeed. It is in all of our interests for this company to be able to raise the capital that they need to be able to fulfill this mandate, to be able to strengthen the fishery of the Province and to grow it, recognizing all the time that we have a changing industry. I will get to it a little bit more later.

The third purpose is, "(c) to recognize the need for a company which operates on the basis of sound business and commercial decisions without undue disruption to the historical pattern of harvesting and processing in the province." There, Mr. Speaker, again is a fundamental statement of what this company is all about. We recognize that it is a private company. We did not support this, by the way, in 1987 when it was privatized, because we, perhaps, foresaw that there is a bit of conflict between a privately-held corporation that is out there with an objective and making money for its shareholders. They have fiduciary obligations to their shareholders. They have to make money or else someone will call them to account. We understood that when we opposed it as a Party in 1987, but nevertheless there it was. Unless we were going to nationalize this company and take it back over we still had to recognize that it had to operate on a sound business and commercial basis, but - and the but is here and the but is the very important piece of this debate here that we are having today and tomorrow - it says, "....without undue disruption to the historical pattern of harvesting and processing in the province." What do we have happening, Mr. Speaker, in the community of Harbour Breton today if it is not un undue disruption to the historical pattern of harvesting and processing? It is, in fact, a significant disruption to that pattern.

The fourth purpose is, "(d) to ensure maximum employment stability and productivity to employee participation in the company"; maximum employment stability and productivity, again recognizing that productivity is important. That may mean the kind of modernization that is being suggested in Bonavista that may reduce the number of the workforce, because it is going to be a more productive plant and a more efficient plant. Usually that means less workers producing more goods and services at a higher rate of mechanization and a higher level of sophistication. It also means more sophisticated jobs for people, Mr. Speaker, in many cases, to operate a higher tech operation and to be able to develop new methods and operate new methods.

We see that stability is important and productivity is important. It is on that basis, Mr. Speaker, when you look at those terms of the purpose of this Act, that we have the fundamental right, as a House of Assembly, to insist that this company operate in accordance with these principles, in accordance with these purposes. That is why, Mr. Speaker, there is so much concern about what the future of Harbour Breton is going to be if this Legislature allows further change to the FPI Act, lifting the kind of restrictions that we understand are contained in the Act with respect to that company.

I am not going to get into the legal debate. We have three or four legal opinions. I have read them all. As the Premier indicated this morning, these are highly respected experts in corporate law. It is not my field of endeavor as a lawyer. These people have examined the precedents and they say that, although there may be opinions, they can do this. In some respects the weight of opinions, of the legal opinions, that I have seen is that they need the kind of changes that are being proposed in order to carry out the disposal of the marketing arm, or the potential disposal of the entire marketing arm in the United States.

We have a situation, Mr. Speaker, where the Community of Harbour Breton is now feeling that they are being abandoned by this company. I will just read - I know the Member for Fortune Bay-Cape la Hune has raised, with great passion and with a great tenacity, in this House over the last long while, the needs and concerns of the people of Harbour Breton. I got an e-mail this morning from a young lady in Harbour Breton. Her name is Jennifer Pittman, and she says: I am a twelve-year-old girl in Grade 7 with two parents who worked at the fish plant. If you do not give us the quota, what will we do, where will we go, and where will they get a job? Please give us the quota. We need it. We are a rural community, and if we don't get the quota we will be a ghost town. Please don't let this happen to Harbour Breton.

Many of the members, if not all of the members, have received this same e-mail this morning. Some of you might not get it until later on. It came in around 10:15 a.m. That is the human face of a child from Harbour Breton who feels that her whole world and her family's world is collapsing around them and feels that her town is being turned into a ghost town. That is the context in which we look at this and say: they, as one of their purposes, must carry out their operations without undue disruption to the historical pattern of harvesting and processing in the Province. Now, what that means in reality, is that this company has an obligation to the people of Harbour Breton. Yes, we can say they have a moral obligation. They made a lot of money there over the years. The people worked hard and built up that workforce but they also have a legal obligation under this legislation to ensure that they do not unduly disrupt these communities. So, they have to come to the plate with something more than what we have seen so far; with something other than a contribution to the make-work efforts that we have.

I was told by FPI officials yesterday: Well, we will sit down with the people of Harbour Breton next week and see what we can do to help them. That does not cut it, Mr. Speaker. This is the time that we have to know exactly what is to be done for the people of Harbour Breton. There is lots of talk about the future. There is lots of talk about the possibility of a shrimp quota coming next year. Well, who is going to deliver that? That relies on the federal Minister of Fisheries. There is lots of talk about the possibility of creating, in Harbour Breton, the kind of success story that we have seen in the District of Cartwright-L'Anse au Clair with the Labrador Fishermen's Union Shrimp Company. They have done a marvelous job. They have done a marvelous job with a shrimp allocation that they have used to develop a royalty regime and train many of their employees. They have used the revenue from that to develop other job related activities on the South Coast of Labrador.

The possibilities exist for the future of Harbour Breton in other species. The possibilities exist in the area of aquaculture. One of the regions of the Province with the warmest water. One of the regions of the Province with less ice. I see a nod from the Member for Lake Melville whose district is covered, or at least the water is covered with ice many months of the year. Well, they do not have that problem in Harbour Breton. They have an opportunity that is not available in many other parts of the Province. These kinds of possibilities can only be brought to fruition if there are some resources, if there is something on the table to allow it to happen. All of these options, all of these opportunities cost money. All of these possibilities can only be brought to fruition if there is an ability to undertake them.

The Premier talked this morning about the possibility of a red fish quota, off (inaudible) outside the Province. Well, I know that there is a red fish quota that one of the significant players in FPI has available - Mr. Risley, who we have heard about many times in this House. One of his companies has a red fish quota which may or may not be available on the market, but where is that in this piece? Why are we talking about that today at the same time as we are talking about an act that is going to substantially change the future for FPI?

We have had, in the last three or four days, some changes for Fortune; some changes for Bonavista. I hope, if we get to that point, that they are going to be in this deal sheet, not letters to Earl McCurdy, the President of the Fishermen's Union. That is very helpful, there is no question about that. If they are going to be enforceable in the way that the other promises are - as the Opposition House Leader pointed out, if they are going to be enforceable they need to be in the deal sheet or the term sheet and they need to be in the ultimate agreement, subject to the same penalties that the other obligations of FPI are. So I want to hear that kind of commitment from the government, if we ever get to that.

Mr. Speaker, I am going to talk - just to let you know, I have an hour allocated, according to the rules. We agreed to this morning. The first half-hour looks like it is going to run out in a couple of minutes, because we have agreed to adjourn at 12:30 and come back again at 2:00 o'clock, so the remainder of my speech will be given after lunch, and I want to talk in specifics about the deal because I think there is a lot of merit in many of the things that are proposed. I do not have this huge fear of an Income Trust, and I will explain why in the second part of my speech.

I will give notice now that I will make this motion towards the end of my speech, that I will be introducing an amendment to this second reading debate, and that amendment is an amendment that is traditionally used in Legislatures to delay the passage of legislation. It is called the six-month hoist. I am proposing something that is a little different than that. It is not designed to delay, but designed to allow the pieces of this puzzle that are not there yet, whether it be federal commitments for supporting the resources and the security and the allocation of agreeing to the security provisions, or whether it be ensuring that the people of Harbour Breton are going to have access to some quota, to allow FPI to put together the deal that is going to be acceptable to this House.

I am going to propose what is called a three-month hoist, that second reading be delayed for three months. That will allow the pieces of this puzzle to be put together. That will allow FPI to ensure that there is going to be some hope for the people of Harbour Breton, that if the quota from Mr. Risley, or other redfish quota, or other quota, is going to be available to the people of Harbour Breton, that the Minister of Fisheries in Ottawa approves it, and that will be something that they can at least feel that there is hope for the future.

There is talk of a redfish quota, but at the same time they want to remove a redfish line. Maybe there is plenty of other equipment there that can operate a redfish quota. I do not know the details. If you are saying on the one hand that we are going to take out a redfish line and that one of your hopes for the future is a redfish quota, there has to be some kind of assurance that this is a quota that can be operated in a viable way in Harbour Breton.

Having said that, I announce my intention. I want to talk about some of the facets of the deal because I think there is a fair degree of merit in what the company needs in order to carry out its objective and be a successful company, but there are also the obligations that are here that I feel are legally binding upon Fishery Products International and subject to our interpretation here in this House. In my view, that includes making sure that there is a future for Harbour Breton after FPI decides that they can no longer operate there.

Having said that, Mr. Speaker, I adjourn debate until 2:00 o'clock, with the concurrence of the House.

MR. SPEAKER: Order, please!

By agreement of both sides of the Legislature, this House will now recess and reconvene again at 2:00 o'clock.

Thank you.


June 9, 2005 HOUSE OF ASSEMBLY PROCEEDINGS Vol. XLV No. 30A


The House resumed sitting at 2:00 p.m.

MR. SPEAKER (Hodder): Order, please!

The Chair asks that we continue debate on Bill 41. It is my understanding that the Member for Signal Hill-Quidi Vidi has about thirty-two minutes left in his presentation.

The hon. the Member for Signal Hill-Quidi Vidi.

MR. HARRIS: Thank you, Mr. Speaker.

When I made my remarks before lunch, I indicated that at the end of my speech I will be moving a motion, which is traditionally known as a hoist, but in fact it delays second reading for a period of, in this case, three months for the purposes of allowing the pieces of this puzzle, which I will call it, to be put in place to ensure that the public purposes of FPI are met in ensuring that we will have, in fact, no undue disruption to the historical pattern of harvesting and processing in the Province, that is part of the obligations of the FPI Act.

I will say, Mr. Speaker, I was remiss this morning in not acknowledging that in the House today we have the new Leader of the Opposition, the Member for Twillingate & Fogo, taking up his duties as the Leader of the Opposition, having been selected by his caucus and ratified by his party. I want to congratulate him on taking upon that role and wish him well in the discharge of this very important parliamentary function. The role of everybody in this House is important, from the Premier, to the backbenchers, to all Opposition members, but the role of the Leader of the Opposition is an important parliamentary role. I think it is called Her Majesty's Loyal Opposition decidedly, because even though the Opposition may challenge a government or challenge the policies of the government, it is a role in which, ultimately, there is a loyalty to the parliamentary system. So I wish him well in his new role and, I am sure, he will discharge it with great vigor and with the usual amount of aggressiveness that is required from time to time to discharge the role properly.

Having said that, Mr. Speaker, I return to my remarks about this bill. I want to talk about some of the more technical aspects of what we are being asked to approve here because we are being asked to approve some significant changes to the existing legislation, changes that would take away some of the constraints that exist. The principal one, of course, is that FPI Limited and the associated companies are not permitted under the existing FPI Act to dispose of all, or substantially all, of its operations; the marketing, harvesting and processing operations. This legislation will acknowledge, or certainly ensure that subsection, which would restrict that, does not apply to the sale by FPI Limited or FPIL of marketing related assets for the purpose of the creation of an Income Trust. That is, I guess, the nub of what we are being asked to do here and so I will talk about an income trust. I have to say, I mean a lot of thought has gone into this. A lot of talk has been made about this and worries that people had, not only in this House, and legitimate concerns brought forward as to what is really going on here.

I think that I am satisfied to say that there is nothing particularly nefarious about an Income Trust. It is an investment vehicle, and it is an investment vehicle that has become popular in the last number of years. We have a couple that operate already in Newfoundland and Labrador. There is an IOC royalty trust where people can buy units of the royalty trust that gives you, as a unit holder, the right to a certain proportion of the value of the production at IOC in Labrador City. It does not give you any say as to who the Board of Directors of IOC are. It does not give you any control over the company. All you have is the right to a particular income stream or royalty, depending on the price of iron ore pellets and the price and value and the amount of production that takes place.

So, if production is up and the value of iron ore is up, you get more from your royalty trust than you would get if production is down or the price of iron ore is down. It is a legitimate investment vehicle. Somebody called it the flavour of the month. I would not go that far. It is something that is being used in the marketplace to raise money and as a source of investment for people who have money to invest. They can put it in a sock and get no interest at all and suffer from the effects of inflation. They can put it in a bank account and do not much better, because the interest rates being offered by the banks these days often do not attract the inflation rate in some cases, or you can give it to that fellow from the Netherlands who talks on the TV about investing your money in some Netherlands bank or you can buy this Income Trust which gives you some kind of an income stream. But, it does not give you any say over the company or any equity position in the company.

On its own, an Income Trust is not some subtle way or some nefarious way to take over through the backdoor a company that you are not allowed to take over through the front door. I am prepared to say that, and I know there are a lot of people who are concerned about that. I am satisfied that it is a legitimate investment vehicle and that the protections which are built into the arrangements that are being discussed here will not allow anybody, even if they bought 75 per cent of the units in the Income Trust, would not give that person, or that entity, or that company control or controlling interest in FPI, or in OCI, or any of these units. Now, they have to comply with the obligations under the Trust. These are fiduciary obligations, but it will prevent - and this is something that I think has to be acknowledged - a direct subsidy by OCI, the Ocean Cuisine International, or whatever they are going to be called, it would prevent probably a direct subsidy. They could not pay more to Newfoundland and Labrador FPI for their produce as a way of subsidizing FPI in Newfoundland and Labrador, because that would then diminish the returns to the investment trust holders. So it changes the water on the beams a little bit, there is no doubt about that, but the profits from the Ocean Cuisine International will still come back to FPI and it is a corporate decision as to how they use it.

The use of the Income Trust is a legitimate way to raise capital. I think it is fair to say, Mr. Speaker - I do not think we are (inaudible) FPI to say this - that the Income Trust is probably going to raise more capital in an easier manner than an actual issue of new FPI shares. Because if you issued FPI shares now, the value that you get on the market is going to be determined by a host of factors, not the least of which, I guess, is the uncertainty of some of the obligations that FPI has under this existing legislation.

So, as a way for this company to be capitalized properly, to have the money that they need to fulfill their other obligations because they - aside from making money for their shareholders, which you do not really have to tell them to do. They are going to try and do that anyway. We are expecting them to be involved in the growth and strengthening of the fishery of Newfoundland and Labrador. So, they have to have money to do that. There are only a few ways to raise money. You can borrow it, you can make it in terms of a form of profit, or you can get investors to buy into your enterprise one way or the other. The way that they have chosen here is to do that through an Income Trust. I think that provided all of the other safeguards that we are talking about and the kind of other obligations that the company has are met. I think we are being asked to do something that FPI wants, it can be in the best interest of FPI to do this, but we also have an opportunity while we are at it, to ensure that they are meeting their other obligations under the act. Because it is one thing to say this is a purpose clause, it is another thing to try and take that to court and enforce it through a legal action. We are not seeking to do that, Mr. Speaker. We are seeking to ensure that this company behaves in that way in the future and one of the ways of ensuring that is to say: What are you bringing to the table now? How are you behaving now? How are you behaving towards - in this case, one of the biggest concerns is the people of Harbour Breton.

There are some obligations that carry on, some for a time limited period. A seven year commitment only, apparently, with a marketing agreement for FPI. Now, you know, we can say we do not like that. It should be a ten year agreement or it should be a nine year agreement, it should be a fifteen year agreement, but that is really not for us to say. That is kind of a business decision. FPI seems to be convinced that a seven year agreement with them would be satisfactory. There is an option to renew for a further seven years. It gives a certain amount of flexibility but at the same time, the United States is not anticipated to be their most lucrative market, or at least they want to have more than one oar in the water when it comes to marketing and not be as dependent on the U.S. market as they are today. Rather, try to find a way to enjoy a penetration of the European market that is as successful as they have been in the past in participating in and penetrating the U.S. market. So, we do see some advantages through their ability to do that and we also see some value in a commitment, not only to take the proceeds of this income trust, not to distribute it to the shareholders or any future issues that might take place, and no funny business, no related party transactions.

I have one problem, Mr. Speaker, and this is something that I don't think - I don't know if we can amend that here or whether we cannot, but I will say that several times throughout this deal, there is a reference to something cannot be done or should not be done or will not be done without the consent of the minister. It does not say Lieutenant-Governor in Council. It does not say the House. It says the minister. With all due respect to the current minister - because he may not be the minister tomorrow, he probably will. He might not be the next day, or he might not be next year, or he might not be after the next election. Whoever -

MR. TAYLOR: (Inaudible).

MR. HARRIS: But there will come a time. I will guarantee everybody in this House, there will become a time when this gentleman will no longer be the Minister of Fisheries.

The question that I had, and I raised it in discussions with officials: Why is it that only the minister has a say in these issues? Why is it not the Cabinet? Because I think ministerial discretion - we talk about that from time to time here. To get the minister to agree to something might be easy - or it might be hard, I do not know. Some ministers will not agree to anything, but to say that the full Cabinet should discuss these things, I think is probably a better protection for the public to say that, where it says: Without the consent of the minister certain things will happen. It should be, in most cases, the Lieutenant-Governor in Council.

When I asked the questions to officials, I think the point was made that it really had not been discussed or thought through as to whether it should be the Lieutenant Governor in Council or the minister. There is certainly an argument to be made that some of these decisions are so important that the permission to do them ought to come from the Cabinet and not from the minister. I just mention one of them because there is a protection there: That no distribution of trust proceeds of shareholders have closing or any future issue or to any related party transactions without the prior consent of the minister. I believe that should be the government, and I hope that is the kind of thing - I do not think that would matter to FPI at this stage, but I would prefer to see that kind of protection.

The obligation that is under this binding agreement will be that they will reduce their bank debt by $30 million and that they would then maintain this capital structure thereafter. So the debt-to- equity ratio would not go below what it becomes after that $30 million is paid down. That is very important, Mr. Speaker. This is an obligation that is going to be there. It has been said many times in this Province that you cannot run the Newfoundland and Labrador fishery on debt because there is too much fluctuation in the market or in market price and you still have to make your obligation to the bankers or to your debt holders, so you have to have a healthy equity position. What this would do, the $30 million that is committed to and dedicated to reduction of debt, will provide a financial position similar to what it was in 2001 when it was so attractive to people who wanted to buy in and take it over. So, that is a good sign. If we are going to go back to that capital structure and a commitment to stay there on a permanent basis or be subject to the penalties, I think that is a positive step forward.

The commitments for various obligations I think we have talked about. I am not convinced that we can bind this company forever, even an economic viability argument. These are difficult things to enforce. Obviously, if it is economically viable the company is going to want to do it anyway. Why would you not? I remember that it was the term: economic viability, that cost Newfoundland and Labrador a pellet plant that was supposed to go in Labrador City, went to Sept-Iles because they can make more money in Sept-Iles. Therefore, putting a smelter plant in Labrador City was not economically viable. Now, I know some further distances have been gone here by defining economic viability. We do have, ultimately, an arbitration provision that will at least give you a place to make your arguments about long-term viability. At the end of the day, it is pretty hard to enforce these kinds of things but at least we have gone as far as I think you can reasonably go with a private entity in insisting that they carry on economic operations.

There is a positive here as well in the commitment to harvest and process all quotas in Newfoundland and Labrador. That is something that the Canadian law does not give us right now. Canadian law does not give us that protection, as we saw during the crab debate. Those who hold the quota for crab, for example, can steam to Nova Scotia and sell their crab to be processed there, just as FPI could take their quota and have it processed in Nova Scotia or in China or somewhere else, and we understand they have been doing a bit of that, so there is a positive there.

Then there is also the notion that there will be a significant penalty in the loss of the groundfish quotas if they breach the agreement, and that is not nothing, Mr. Speaker. That is a very significant step, and certainly indicates the bona fides of the people on the other side, at least to put that on the table and say that is at risk.

On balance, Mr. Speaker, I have to say that the pluses in terms of this agreement, and what it is allowing FPI to do, are significant here. Unfortunately, we have two problems. Number one is that we do not have a viable plan for the future of the people of Harbour Breton and that community and, until we do, I do not think we can support this legislation, support this change.

We have an opportunity now to require - and I am using that word advisedly, to require - FPI to meet its obligations to not unduly disrupt the community of Harbour Breton in their business plan. We, in this party, expect them to live up to that obligation under the act.

The second problem we have, Mr. Speaker, the second big problem we have, is, there is somebody missing at this table. There is somebody missing at this table. We have the Government of Newfoundland and Labrador making certain commitments. I am not satisfied that they made enough, but they are making certain commitments.

AN HON. MEMBER: (Inaudible).

MR. HARRIS: We will see. We will find out at the end of the day how much they really make. We will see. I guess that is a process of negotiation.

We have not seen a diversification fund being set up with participation from the Province and the company. We have seen a contribution to what I would call worker adjustment. The money that is on the table now is going to be used up in individual worker adjustment. That is not going to solve the problem for the community in the future, so we have to see a diversification plan in place for the people of Harbour Breton.

Who is missing at the table here, Mr. Speaker, is a significant player in the fishery of Newfoundland and Labrador, and that is the Government of Canada. Where is the Government of Canada at this table? Where is the Government of Canada who share, and share mightily, as part of the problem, charged with the management of the fishery resource, charged with that management and, in fact, necessary for this arrangement to even go forward? Because if there is no approval by the Government of Canada of the security arrangements on the transfer of fish quotas in the event of a default, then there is no deal, but I do not see them at the table, Mr. Speaker. We haven't heard from the federal minister, the regional minister for Newfoundland and Labrador, John Efford. Where is he? Where is he in these discussions? Where is the Government of Canada in discharging its responsibility for the future of fishing communities in Newfoundland and Labrador? Because, there is no question about it, they are part of the problem, but I do not see them anywhere as a part of the solution for the people of Harbour Breton. That piece of the puzzle is missing, and is very obviously missing. I am not sure we can go through with a viable plan for the future of Harbour Breton without their participation. When we had a diversification fund for the people of Trepassey, the feds were very much involved, as they should be here.

You know, there is another very important part, because we talk about this being all about fisheries. One of the reasons that we are in this predicament and we are talking here about conditions related to resource shortages and what is going to happen in the future, and their obligations are contingent upon the availability of these quotas and of the resource, what we have missing from this whole mix is a commitment to the rebuilding - and this is not related to this bill, but a commitment from this government and from the Government of Canada to rebuild the cod stocks.

You know, we just went through an exercise of having a Royal Commission on the future of Newfoundland and Labrador and our place in Canada. One of the most substantial and far-reaching of the recommendations of that Royal Commission was a commitment, and a substantial commitment, from the Government of Canada and the Government of Newfoundland and Labrador to undertake the rebuilding of the groundfish stocks off Newfoundland and Labrador. We cannot just wait around for fifty years and hope they come back. There are scientific efforts that need to be undertaken, whether they be studying certain things that need to be studied, whether it be seeding the stocks in certain places where they can grow. There is any number of suggestions that have come forward from time to time, and I am not a scientist so I do not know what they all are, but where is the action on this front? Where is the action on this front? Instead, we seem to have a fisheries policy that allows us to facilitate the taking away, the cleaning up, of whatever stocks are left. We are landing undersized fish in Newfoundland and Labrador, transshipping it, keeping processing activity and markets going in other countries. We are aiding and abetting as one former, significant player in the fishery and still a great commentator on fishery issues said, we are aiding and abetting -

MR. TAYLOR: We are bringing it ashore these days (inaudible).

MR. HARRIS: We are bringing it ashore. The man says we are bringing it ashore. We may be bringing it ashore and transshipping it out, but we are talking about fish that could be contributing to the rebuilding of the stocks off our Grand Banks and being an important part of our future.

That is another debate, Mr. Speaker. It is another debate, but it is an important part of the debate. We would not be having this debate today if we were working to solve that problem, because we would be dealing with a far more profitable company in its Newfoundland and Labrador operations than we are today.

Mr. Speaker, I think we have to recognize that while there are elements of this that are good, and the positive things that we have learned in the last few days from FPI about decisions for Fortune, decisions for Bonavista - and, by the way, I think they have to be put into that term sheet or whatever it is called, a new word for me, but the term sheet. They have to be there. They have to be in the binding agreement. It is no good to just have a letter, because the same penalties that apply to the other obligations ought to apply to the commitments to Bonavista and the promises to Fortune that were made in the last forty-eight hours. That has to be as a part of the deal, and I hope that the government recognizes that and will commit to that if this bill passes.

I want to say one more thing, Mr. Speaker, because we are all here today and some of our districts are affected mightily by this decision and by the commitment, or lack thereof, to places. The Member for Fortune Bay-Cape la Hune, of course, is one, and there are many others who are not. There are many others whose districts are not. This is not a question, Mr. Speaker, of what is good for my district or what is not good for my district. Obviously, you have to represent your own constituents in this House. We all have an obligation to ensure that Fishery Products International, or Fishery Products Limited, lives up to its obligations under the legislation that is here.

I am prepared to say that if there is no commitment that gives hope for the people of Harbour Breton in the future then we ought not to pass this legislation. It is not good enough to say that the Member for Bonavista might be a little more pleased today than he was last Friday, or that the Member for Grand Bank - and she is going to speak for herself, no doubt - that she is happy that they have made some commitment to Fortune and not leave it up in the air, but we all have an obligation here. We can all be outnumbered. You can get five out of six - two out of three, five out of six - but we have a chance and an opportunity here to insist that the people of Harbour Breton be treated fairly as well.

I read into the record this morning a letter from a twelve year old girl, Jennifer Pittman from Harbour Breton, and all of the other children and people of Harbour Breton are depending upon us to ensure that their interests are looked after. We do have that obligation, not just to our own constituents but to all the people of Newfoundland and Labrador. I urge all hon. members to think about that as they make their speeches and as they are ultimately called upon to vote on this issue.

In fact, what I am proposing now - and I am going to make an amendment, the amendment that I signalled this morning that I said I was going to make. I will reserve my time to talk on it until another time, but I want to make an amendment which is normally considered a dilatory motion, put things off so that the government cannot do what it wants to do. This is not a case of the government wanting to do something, we are told. This is a case of bringing it before the House. I am proposing an amendment that will say that the second reading will not go forward now, but go forward for second reading three months from now.

Now, we know that if this bill is passed tomorrow nothing is going to happen immediately in any event. There has to be agreement from the Government of Canada on the quotas, or else there is no security, or else there is no deal. There is talk of quotas for Harbour Breton. That all has to have the permission of the Government of Canada as well, because you cannot transfer quotas in this Province. They are not assignable without the consent of the Minister of Fisheries. We have to have the federal government at the table, maybe, in order to have a proper diversification fund to assist the people of Harbour Breton. These are the pieces of the puzzle that are not yet in place.

If we delay the passage of this bill for three months - maybe the Minister of Justice can tell us - it is probably going to take sixty days to put together an agreement to put all of the wording together. We have the bare bones here, but all of that has to be worked out before it can even be signed. So there is lots of time for these things to be put in place, and certainly time for the pieces of the puzzle to be put into place for the people of Harbour Breton and the commitments from the Government of Canada that might be necessary to make that happen.

I want to move, at second reading: That all the words after the word "That" in the motion at second reading be deleted and substituted by the following: "Bill 41, An Act To Amend The Fishery Products International Limited Act, be not now read a second time but that it be read a second time this day three months hence."

That is the amendment. I believe it has already been looked at by the Table. Perhaps you can indicate the ruling as to whether it is in order.

MR. SPEAKER: I thank the hon. member.

The Chair will call a recess so we can examine the amendment. We will be back very, very shortly, not more than two or three minutes, with a ruling from the Chair.

The House is now in recess.

Recess

MR. SPEAKER (Hodder): Order, please!

The Chair rules that the amendment submitted by the Member for Signal Hill-Quidi Vidi is in order.

I do understand we still have approximately another two-and-a-half minutes left in your time limit for the one-hour presentation.

MR. HARRIS: Thank you, Mr. Speaker.

I am pleased that the amendment is, in fact, in order. I will have twenty minutes to speak to that amendment at a later time during this debate. I understand that the rule we have agreed upon is that this amendment is now on the floor, there may be other amendments on the floor at the same time, and that all amendments, whether they are amendments of this nature or specific amendments to the legislation, will be dealt with at the same time at the end of our session.

The purpose of the amendment, I think, I have spelled out. Even those of you whose district is being very favourably treated by the commitments that are being made here, I think can find some comfort in this amendment. Because it will allow this provision to go through at a later date and will allow an opportunity for FPI and the Government of Canada and this government, if need be, to ensure that the pieces of the puzzle, what is necessary for the people of Harbour Breton, to give us a comfort level that the objectives of the Act are being met, that we are not unduly disrupting the traditional harvesting and processing patterns, that there will be other alternatives for the people of Harbour Breton made possible by a contribution from FPI, by potential participation of the Government of Newfoundland and Labrador and hopefully, and rightfully so, participation from the Government of Canada. It will not delay the actual implementation of any of these plans because they rely on the commitment from the Government of Canada. This government cannot sign an agreement without the support or the commitment from the Minister of Fisheries that he will honour the security arrangements that have been negotiated.

There is a whole series of things that have to be put together before this deal can happen and I would be very surprised if they would be finished in sixty days in any event. The three-month delay or hoist or whatever you want to call it, is in fact a very practical means of achieving what we need for the people of Harbour Breton and allowing the positive aspects of this to go through for the benefit of Fishery Products International.

Thank you, Mr. Speaker.

MR. SPEAKER(Hodder): The hon. the Member for Bonavista South.

SOME HON. MEMBERS: Hear, hear!

MR. FITZGERALD: Thank you, Mr. Speaker.

I, too, welcome an opportunity today to speak on Bill 41, An Act To Amend The Fishery Products International Limited Act.

Let me say to you, Mr. Speaker, that if somebody hiccups in the fishing industry today then it is certainly felt in the district that I represent, Bonavista South. I can recall back, not too many years ago, when 2,000 processing jobs disappeared in the district that I represent. Mr. Speaker, you take 2,000 jobs out of a total population of a little over 14,000 people and you know what affect the fishing industry has on a district like Bonavista South.

Mr. Speaker, I submit to you that one of the leaders in the fishing industry at that particular time was the Town of Port Union, that saw 1,400 people lose their jobs. One of the largest processing plants in Eastern Canada and 1,400 people went out the door without a job. Fifty-two supporting businesses closed their doors, walked away, Mr. Speaker. Move over to Bonavista: 300 people lost their jobs. Move up the road to Charleston: plant closed down, 300 people lost their jobs. There is one community that exists next door to the community of Charleston, where the fish plant was located, where even today 150 people live. Mr. Speaker, there are five people from that community who get up in the morning and are fortunate enough to go to work; five people. Mr. Speaker, the Town of Port Union, to my best knowledge, haven't issued a building permit to build a private residence since 1992. Now, that might be hard for people to comprehend when you are living in St. John's and you drive out to Southlands or out to Stavanger Drive or Merchant Drive here in St. John's and see the activity that is going on, but that is what is happening in the District of Bonavista South.

Mr. Speaker, if you say it to me, am I happy today to see something positive happen, to see the Town of Bonavista given a reprieve, where they might be able to breath some life and see that community survive: Absolutely. Absolutely, I am supportive of that. I have no other choice. It does not give me any great feeling to see the Mayor of Harbour Breton or the gentleman representing the union with their plight, with what is happening in Harbour Breton, a place where I worked myself, I say to members within the House - I worked for Fishery Products International for thirteen years. I have said before, there is probably nobody else who sits in this Legislature who has visited the boardroom of Fishery Products International anymore than I have, as an employee of Fishery Products International and as a politician representing Bonavista South with two major FPI operations, the biggest employer on the Bonavista Peninsula for the last twelve years since I have been elected. It certainly concerns me, and I know what happens when you strangle a company and do not give them the right to be able to go out and compete in the marketplace and do the activity that needs to be done in order to generate new jobs and in order to compete and survive in a global marketplace.

Mr. Speaker, the fishery in Newfoundland and Labrador has seen some major, major problems this past number of years. When you look at some of the plants that were operating on H and G cod, where Fishery Products International and other companies could go out and pay - I think, just a few short years ago, they were paying something like $2,200 per metric ton for H and G cod. With the difference in the exchange between the Canadian dollar and the American dollar you look at the shrinkage of that exchange today, and you look at what you they are paying for H and G cod today which in excess of $3,500 a metric tonne, Mr. Speaker, it is not hard to know why some of our fishing companies are finding it very, very hard to survive and maintain the same numbers as they have in years gone by.

Mr. Speaker, I would like to make a correction, because the Member for Signal Hill-Quidi Vidi talks about an add-on for Bonavista, and something that is different. It was a term that I used but it is an incorrect term, because it is not an add-on for the Town of Bonavista. Mr. Speaker, if you look at the agreement that was put forward and presented to each member of this House of Assembly, the FPI Term Sheet, Ocean Cuisine Trust, June 6, 2005, it goes down through and lists Marystown, Port au Choix, Port Union, Triton, Bonavista, Burin and Fortune. Here is what is says about Bonavista, Mr. Speaker, "Recognizing that the Bonavista facility is in need of replacement, FPI undertakes to either replace it or combine it with its Port Union operations within two years, and to consult with both the FFAW/CAW and the community in determining its course of action."

Mr. Speaker, our caucus, as I understand the Opposition caucus, met with representatives of Fishery Products International on Monday past. At that particular time, when I heard of what was in store for Bonavista I had asked the members who were present if they would be able to travel to Bonavista, or would be able to allow the Town of Bonavista, myself and the FFAW to convene a meeting early the next morning. They had no problem with that and eleven o'clock the next morning we met in Bonavista.

At that particular meeting, the town was represented, the FFAW was represented, I was there as their member, Mr. Speaker, and FPI heard loud and clear what the Town of Bonavista would like to see, what they would accept, and what they could live with as part of this agreement. Mr. Speaker, at that time, and before the meeting was over, my comment was: Mr. FPI, you have stated in your terms that you would consult with the town. You have done that today. You indicated that you would consult with the FFAW/CAW, you have done that today. You heard the message loud and clear, so I do not think we need to wait two years to make a decision. We should do it now.

The gentleman, Mr. Roome, informed us that he did not have the authority to make that decision, he would need some time. We asked for a conference call to take place that night, and the conference call was between the Town of Bonavista, representatives of the local union in Bonavista, Mr. Earle McCurdy, the President of the FFAW/CAW here in Newfoundland and Labrador, and myself, Mr. Speaker. At that particular time, Mr. Derrick Rowe made the commitment that he would now make the decision, as one of the options was clearly outlined in the terms it was given, now rather than two years time. Everybody knows what the commitment was.

I say to members opposite, what FPI did for the Town of Bonavista was not an add on to the terms that they had put forward. It was a situation where they did not wait two years to make a decision. That decision could very easily have turned out the other way and we could probably have been saying: Well, wait two years, things might change. It was the decision that we wanted to hear, it was a decision that made me happy, it was a decision that made the Town of Bonavista happy, and, I might add, the President of the FFAW/CAW, Mr. McCurdy, fully endorsed this agreement. There was a letter referenced as to making this decision and what their obligations would be and what they had intended to do, and that was not an add on, I say to the Member for the Signal Hill-Quidi Vidi. That was making a decision clearly in line with the terms of the agreement but it was made now rather than two years later.

Mr. Speaker, we talk about Income Trust: I do not know if a lot of people are really concerned about it, although that is what the legislation is about. I will tell you, at the meetings that I had in Bonavista and the meetings that I had in Port Union there was not a big lot of talk about Income Trust. Most of the talk is, what is in it for the Town of Bonavista, what is in it for the Town of Trinity Bay North which now includes Port Union, Catalina, and Melrose, and how do we fit in with the big picture of Fishery Products International.

Mr. Speaker, the truth was told as far as I am concerned, as best as the people attending the meeting knew it. It was something that I accept and, at that particular time, the people in Port Union clearly indicated that we are not interested in taking anything from the Town of Bonavista even though it means moving a plant underneath our roof where we may have an opportunity to secure something that we have. The comment in Port Union was this: We support the Town of Bonavista. We believe Bonavista, having the second oldest shellfish processing plant in the Province, started in 1969, and being one of the largest historic fishing communities on the North East Coast, it is not our intent to say: Come on, bring your processing facility over here and let's put it under one roof because it might be more positive for us. The comment was: We do not want to take anything from the Town of Bonavista. If it means something being taken from the town, moved off the Peninsula, then we want it here, but we are not interested in having one town pulled against the other. The message was clearly delivered. The representatives of Fishery Products International heard loud and clear what both communities thought, what representatives from the union at both plants thought. I guess that is what helped them make up their mind.

Mr. Speaker, let me get back to the Income Trust, because it has created a lot of debate and everybody has all those fears of what might happen. I refer back to an article in The Telegram, February 26, 2005, and it was written by a business person who is very highly respected in this Province, I might add, and has been recognized for his business accomplishments and is in the seafood business, in the fishing industry business, a gentleman by the name of Ches Penney, who is the President of the Penney Group of Companies here in St. John's. Let me tell you what he had to say about Fishery Products International and about an Income Trust. I am going to refer to just a couple of paragraphs here, because I think it makes a lot of sense and it puts it into perspective, because now you are seeing a independent business person, who is clearly established. In fact, Mr. Speaker, it is a business person who has gotten involved, in more recent times, in the fishing industry, and has been recognized by his peers right across Atlantic Canada.

Let me tell you what he says, "Income trusts become an accepted form of raising capital instead of borrowing which requires repayments of principal and interest regardless of earnings. "Dividends" to owners of units (shares) in an income trust are made from the earnings of the company and are paid as a proportion of such earnings." He goes on to say, "Some are questioning the right of FPI to sell 40 per cent of the assets of its U.S. marketing division to an income trust. There is nothing sinister in this. The alternative is bank borrowing, which will have a negative effect on the company's ability to grow and service its many customers, including harvesters and also smaller processors in Newfoundland and Labrador who depend on FPI to purchase and sell their inventories." He goes on to say, "FPI has invested heavily in recent years in plant upgrading and new fishing vessels. Money borrowed for this purpose should be allowed to be repaid from the issue of "equity". Bank debt for capital expenditures can hinder the company's ability to grow."

Then he goes on to say, and his final thoughts are, talking about fierce competition, "The decision to upgrade plants and buy new fishing vessels was made when the Canadian dollar was far more favourable than today and also China has since become a "juggernaut" in the fish processing industry. Chinese wages at 25 cents an hour are a fact of life that FPI has to live with. Fish processing in Newfoundland and Labrador is a tough business and anything that can be done to assist FPI, without costing the government money, should be allowed to proceed. I see no risk in the proposal FPI has placed before government as only 40 per cent of the shares of the U.S. unit will be sold. Control will still rest with the existing company (subject to the FPI Act), and the money raised will be used for sound purposes."

These are his final thoughts, "A strong FPI is of vital importance to the thousands of Newfoundlanders and Labradorians who depend on it. I do not own any shares in FPI and am interested only in seeing this company survive and grow." Those are comments from Mr. Ches Penney. Everybody knows who Ches Penney is.

Mr. Speaker, in a lot of our fishing communities we saw people leave school at an early age. We saw people in places like Harbour Breton, in places like Bonavista, in places like Port Union, be able to leave school when they were sixteen or seventeen years old, and at that particular time the mindset was that you went to school to get a job. If you could get a job in your community, where you were being paid a decent wage, you could go home for dinner every day. It was a place where you saw your mother, it was a place where you saw your father, your brothers and sisters. For the most part, they all worked in the same plant. A lot of people left school and went to work. In this particular case, it was probably Fishery Products International in the communities that I am talking about.

Today, some of those same people find themselves in a very frightening situation. They find themselves fifty-five or sixty years old, without a job, without an education, and where are they going to go to find a job? Where are they going to go to find a job?

We see people demonstrating, and we see people continually holding the company's feet to the fire in front of politicians, and rightly so. I commend them for doing it, because they are doing the most honest thing a group of people can do, and that is to look for a job and try to maintain their communities.

I remember, just a few short years ago, going down to Harbour Breton and taking part in an all-party committee doing public consultations on the FPI Act. The Member for Signal Hill-Quidi Vidi referred to it. He was a member of that committee, as well as the Minister of Fisheries and Aquaculture. I remember going down to Marystown. That was quite a meeting. I remember going down to Bonavista. We went to Discovery Collegiate down there, the big auditorium filled to capacity, fish plant workers, townspeople, young people, older people, but the meeting that stands probably fresher in my mind than any other one was the meeting, I say to the Mayor of Harbour Breton, down in Harbour Breton.

We went there, and the Member for Signal Hill-Quidi Vidi will clearly know, and the Minister of Fisheries and Aquaculture will clearly know, the meeting took place. It was a cold night, and stormy. We went in there, and the plant in Harbour Breton was operating that night. When break time came for the workers at the plant, I would suggest that every one of them marched in to our meeting with their FPI shirts on, their hats, caps, their rubbers, the same way I went to work for thirteen years, I say to Members of this House of Assembly. They came there as proud people, saying that they wanted to have some say in how Fishery Products International was structured, how important it was to their town, what it meant to their town, and they voiced their opinion in a very professional, caring, compassionate, sensitive way. Then they looked at their clock and said: We have to go now. No disrespect to the people who are present, but our break is up.

The Minister of Fisheries and Aquaculture remembers that: We have to go now, our break is up. It was not the point of, let's stay here all night because this is a meeting and nobody is going to fire us for trying to come out and protect our town. Mr. Speaker, that is what happened.

While I stand here today and I am happy, I have to admit that I would have been a naysayer in this piece of legislation if I did not get something - I should not say if I did not get it, because it was a lot more than the member doing this. It was the Barry Randells and the Hedley Butlers and the Mayor of Bonavista, and the list goes on - Beverly Dykes. They have been in here constantly, meeting with Fishery Products International. Every meeting that we have had has always been: We need some assurances for our plant in Bonavista.

If that did not happen, I would certainly be a naysayer here today. When I stand to vote - I have said it publicly - I will be supporting this piece of legislation. Nobody has to wait until the vote takes place to know where I am. I will be supporting it, and that is the reason.

Mr. Speaker, I do not blame the Member for Fortune Bay-Cape la Hune on how he is going to stand, and I commend him for the professional way that he has asked questions here. He has brought forward the concerns of Harbour Breton. He has brought forward the concerns of the people he represents. That is why he is here.

Mr. Speaker, that is the reason I am here too. That is why I will support this piece of legislation. Because the alternative, I say to people here in the Chamber, my prediction would be that you would see FPI own one crab plant in Newfoundland and Labrador instead of two; you would see FPI owning one shrimp plant in Newfoundland and Labrador instead of two; you would see one groundfish operation, and maybe some different secondary processing plant will survive - there is no doubt about that - down in Burin.

MR. SPEAKER: Order, please!

The hon. member's time has expired.

MR. FITZGERALD: Mr. Speaker, just a second to clue up?

SOME HON. MEMBERS: By leave.

MR. SPEAKER: Leave has been granted to make some concluding comments.

MR. FITZGERALD: I do not want to take advantage, Mr. Speaker.

That is where I stand on this, but I say to people opposite that I would stand a lot quicker and I would stand with a lot more spring if there was something in it knowing that the people in Harbour Breton would be looked after as well, but I think the alternative to not supporting this piece of legislation is going to reflect on rural Newfoundland and Labrador.

I will tell you that we cannot afford to see any more Burgeos, Rameas, and now we have a difficult situation in Harbour Breton. We cannot afford to see any more than this. If we are going to strangle this company and not give them the ability to go out, compete and survive, going that route, I fear that the repercussions will be great and we will pay the price.

Thank you, Mr. Speaker.

I am glad to add some comments to it.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The hon. the Member for Grand Falls-Buchans.

MS THISTLE: Thank you, Mr. Speaker.

I am pleased today to stand and speak to the bill before our House, Bill 41.

It is an unusual sitting of the House, a very unusual sitting of the House. I must say, people are very reserved, very quiet, and very well-behaved here today. They understand the seriousness of the issue that is before us all.

When this first came to the attention of the Opposition, we were curious to see what was in the term sheet proposed by FPI. We have read through it many times, as well as the government members. Normally, when a piece of legislation is brought to the House of Assembly by government, as it is today, it is the intention that government would pass that piece of legislation because they are in agreement or else they would not be bringing the legislation to the House of Assembly; but, judging from what we have heard today, particularly from our Premier, he is not convinced that he will even vote today or tomorrow in favour of this legislation.

I think all of us are feeling, at this time, particularly myself - I represent the District of Grand Falls-Buchans, and I depend, and we depend, in our district, on fisherpeople spending their money in Grand Falls-Windsor. So, even though I represent a paper town, we look to places like Harbour Breton and Triton, all the South Coast and neighbouring communities of fisherpersons to come into Grand Falls-Windsor and spend their money. We found a difference already, since Harbour Breton has been down, since the plant has been closed. We have already found a difference. We have businesses already in Grand Falls-Windsor that have closed their doors. We have two car dealerships that have closed their doors. We also have an industrial marine centre retail outlet that has closed its doors, as well as a couple of fast food enterprises. We know for certain that if this continues we will see more of that devastation.

Talking about Income Trust, what FPI want to do with this piece of legislation is, actually, they want government to untie the apron strings and allow FPI to operate as a private enterprise like any other in this Province, but it is difficult to say operate like an ordinary enterprise in this Province when we have - FPI was a made in Newfoundland solution. It was a made in Newfoundland solution to many ailing fish companies and rural communities that depended on fishing to survive. Although it has been many years since 1983, we still have the same concerns in rural Newfoundland and Labrador. Our fishing is our backbone industry.

The purpose of this legislation being brought to the House today is for all government members to explore what is put before us, and for us to make our opinions and our advice known to government. The glaring reality of this today is that we have found, through the course of reviewing the material and also through debate, that there are many aspects of this legislation that need to be strengthened, and they have already been alluded to this morning; however, I want to focus on the biggest concern of this legislation.

I understand completely that this is a business case that has been presented to government. I understand completely about the financial condition of Fishery Products. I also understand that going to the bank is not an option, that they must find other ways to finance their business ventures and their operations, both within this Province and outside, their global operations. The avenue of Income Trust is the way to go, and they are coming to government and asking that we support it. How can you support it when there are several outstanding issues on the minds and the hearts of all Newfoundlanders and Labradorians?

I was glad to hear at the eleventh hour that Bonavista is going to get a new plant. I say congratulations to the Member for Bonavista South. I mean that sincerely and genuinely. I was very glad as well when the Member for Grand Bank heard some very good news for Fortune. These are things that happened at the eleventh hour of this proposal coming to government and to the Legislature. We are still in that eleventh hour. Some things have not changed. We are still in that eleventh hour.

I think there is still time for the Premier of our Province to make sure that he gets that deal for Harbour Breton in whatever form or substance it will take. He does have the ace card. The Premier of this Province has the ace card, and he will direct his Cabinet and his caucus as to how they should react in this matter.

We have already heard from the Member for Bonavista South. Regardless of what deal there is, or no deal, he will vote in favour of his constituents. I understand that completely. If this deal was before me at this time and it affected my constituents in Grand Falls-Buchans, and it meant an opportunity for them, hope for their communities, I would have no hesitation. I would go with my people, and that is what we are elected to do here; however, I feel terrible for the people in Harbour Breton. There are a neighbouring community of Grand Falls-Windsor, Grand Falls-Buchans District.

This is the time in the year that schoolchildren are thinking about a summer ahead of them, a free summer where they can dance and run in the sunshine and be carefree, but from the number of e-mails that have clogged up my computer, and everyone sitting in this House this morning, they do not have that freedom. When you have young people in elementary school spending their time on their computer trying to get through to decision makers in this House of Assembly on a warm summer day, you know their hearts must be heavy. Grade 12 students who are about to graduate this year, this should be a happy time for them, when they are graduating. Still, for all of that, their parents are wondering, probably, how are they going to get the money to buy that graduation gown, that graduation ring, that graduation tuxedo? How are they going to rent that? What are they going to do after school closes?

Are the children thinking: My goodness, are we going to be able to go back to our school in September? Are we going to have to pack up our clothes, our furniture, and take off for Toronto or out West somewhere to survive? It was heartbreaking to hear the people calling in from Harbour Breton over these past several weeks, and families being broken up, having to leave each other and so on, and look for employment elsewhere.

I think back to when the announcement was made last fall for Harbour Breton, and I really think that FPI, at that time, were very callous. Even their announcement did not give the proper notice to the workers who had been in the plant for years. I know that they have had different employers, and FPI has not been the employer for all of the fifty years that they have been in business, but they have been the employer for several, several years.

Can you imagine an employer that said, when we did an all-report committee - the Member for Bonavista South just alluded to that. When they went to Harbour Breton there were 700 people who came off shift in the plant and came into that meeting. Some of the things that were said at that very time by people on the Board of Directors of FPI, it was interesting to look back over it. It was 2001. At that particular time, they said there is no plan to cut jobs or close plants. This is a direct quote by Mr. John Risley. It was May 2, 2001, on VOCM news: We are very sensitive to the responsibility we have to communities, and I can assure you that we seek to build on that conscience, not to tear it down. None of the FPI employees have anything to fear.

That was said by one of the board of directors at that time, Mr. John Risley. Here is a quote from Mr. Derrick Rowe: So I think you will see that we will be proceeding very quickly, as due process will allow, to seek out new investment opportunities, and with that we believe we will create new employment opportunities and quality job opportunities.

That was made May 2, 2001, on VOCM news.

I wonder, did the people in Harbour Breton take any consultation from what they heard at that time? The people in Harbour Breton and all the Connaigre Peninsula are very proud people. They have always worked for a living, and you can see it. This time of the year people would be painting up their homes, fixing their fences, tending to their gardens, thinking about festivals, homecomings and picnics. Bud Davidge, his music would be ringing through the houses in Harbour Breton, Music and Friends. What kind of a ballad is Bud Davidge going to write today? What kind of a ballad is Bud Davidge going to write for the people of Harbour Breton today, I wonder? It is going to be a sad one unless we fix this here over the next twenty-four hours.

I think about the people on the Connaigre Peninsula. You know, that might be a second hit coming down the road. A lot of them worked for Abitibi-Consolidated. They are loggers, they are silviculture workers. Are they going to get a second hit now at the end of June? Because, Abitibi-Consolidated, that is the same issue as we are discussing here today. Abitibi-Consolidated is a private company who depends on the natural resources of our Province to manufacture their product and sell it elsewhere.

The people of Grand Falls-Windsor were happy and content. We had a five-year contract signed with our workers. We had lots of wood. We had lots of power. We were happy. We had no problems. We had timber licences tied to government legislation. What did we hear over the past two months? We are hearing now that number seven paper machine is coming down. The government gave us a commitment for a power purchase to be connected to two machines and they have moved away from that, so what is coming down with Grand Falls-Windsor at the end of this month? The people on the Connaigre Peninsula are going to get two hits if this happens. It is always in the purview of this House of Assembly. We can change this if we try hard enough.

I think back to when the announcement was made. There was really no consultation with the community of Harbour Breton. There was very little notice. In fact, they are fighting now for their very existence, having to take the company to court to get the very thing that, by law, they should have had, which was notice period, which results in a severance cheque for each person. There is no way that the workers in Harbour Breton should have to fight for a severance to be paid to them.

There are two or three issues in particular that I am concerned about on the FPI Term Sheet. When I look at the term sheet, there is no reference made to: What about the federal government cut their quotas next year? There is no reference made to that. That will have to result in plant closures. There is no plan regarding a possible decrease in quotas next year.

They are going to work with their Ocean Cuisine to provide information technology. The company is going to invest $4 million in information technology. They are going to share an operation with Ocean Cuisine, the U.S. operation, for information technology. That agreement is for five years. I ask: What will happen at the end of that five years? Will that information technology be transferred in the U.S.? Where will the jobs that are going to be in Newfoundland and Labrador be at that point? They have a legal obligation in the FPI Act to leave their headquarters in St. John's. Will that be a shell operation in St. John's for a headquarters, or can we expect to see that in the U.S.? These questions are not answered yet at this point.

When I also look at the fact that even though FPI is going to gain, initially, about $100 million from the sale of their marketing arm in the U.S., that is only 40 per cent of the 65 per cent of their marketing arm that they are going to get $100 million for. When they decide to sell the remaining part of the marketing arm, what are they going to do with that money? Do we know if it is going to be invested in Newfoundland and Labrador? I don't think so.

The fact that they are looking to invest $8 million into their facilities here in Newfoundland, but $4 million of that money must come from government in the form of an interest-free loan, that is kind of curious to me, when you have the capability of generating revenue in excess of $100 million just by the first offering of selling off your marketing arm in the U.S., and they are still coming to government looking for an interest-free loan to be matched with the money they are putting in, $4 million. They want matching money from the Government of Newfoundland and Labrador to upgrade facilities in this Province.

They are also looking for a revolving line of credit, guaranteed by government to assist processors in this Province for marketing their products, which is something that FPI did on their own in the past. They are also looking for an appropriate government agency to pay half of its $2 million in research and development costs over the next two years.

In essence, what are they giving back to the people of this Province? What are they giving back? They are selling the most lucrative part of their company to raise funds rather than go to the bank, and I understand that. I understand that issue, but I am surprised with a large multinational company like FPI raising over $100 million and they are still coming to government at this point, after government in the past having invested $234 million in FPI since its inception in 1983. Even at this time, this juncture, after asking permission to sell off its U.S. marketing arm, they are still coming to the Province of Newfoundland and Labrador and asking for three types of financing for the future for fish business related operations in the Province of Newfoundland and Labrador.

It is interesting, too, that FPI have given the Government of Newfoundland more or less an ultimatum in bringing this proposal forward. They said they wanted no changes to the proposal. That part was certainly interesting, where they would be demanding that no changes be made, but I am glad to hear today that this House of Assembly is entertaining amendments. I think, with the collective debate of both sides of the House, that we will have an opportunity to enhance this proposal that is here before us today.

The biggest problem that I have with this proposal, I understand what the company is trying to do, it is a business decision, and I understand that this is a good way to do financing, and I also understand over $100 million, they are still coming to government at this point, after government in the past, having invested $234 million in FPI since its inception in 1983, even at this time, this juncture, after asking permission to sell off its U.S. marketing arm they are still coming to the Province of Newfoundland and Labrador and asking for three types of financing for the future for fish business related operations in the Province of Newfoundland and Labrador.

It is interesting too that FPI had given the Government of Newfoundland more or less an ultimatum in bringing this proposal forward. They said they wanted no changes to the proposal. That part was certainly interesting where they would be demanding that no changes be made but I am glad to hear today that this House of Assembly is entertaining amendments. I think with the collective debate of both sides of the House that we will have an opportunity to enhance this proposal that is here before us today.

The biggest problem that I have with this proposal, I understand what the company is trying to do; it is a business decision. I understand that this is a good way to do financing, and I also understand that the people of Newfoundland and Labrador need this business, they need this company, and they want to continue to do business with FPI. They want to grow fishing communities in this Province, and we all depend on this company. We have looked up to this company.

The part I do not understand is, why is there nothing for Harbour Breton? I cannot, myself, support this legislation when there is nothing there for Harbour Breton. If we can see some way, over the next twenty-four hours, to come up with an enhancement to this term sheet from Fishery Products International, if we can see a way, and I am sure there is - eleventh-hour negotiations work, no matter what situation you are in - I think we have a moral obligation not to leave the Connaigre Peninsula out in the cold; because we know, geographically speaking, the Connaigre Peninsula cannot survive without the fishing industry, just because of their location where they are. They need an answer.

When you have over 300 workers in Harbour Breton today waiting for an answer from this Legislature to provide a future for them and their families, I think we, as legislators in this House of Assembly, must find a way to accommodate Harbour Breton if this piece of legislation is going to go through.

Thank you, Mr. Speaker.

MR. SPEAKER: Order, please!

The hon. the Minister of Environment and Conservation.

SOME HON. MEMBERS: Hear, hear!

MR. T. OSBORNE: Thank you, Mr. Speaker.

Mr. Speaker, I guess the question here for everybody in this House is whether or not we vote in favour of this bill. I would submit that every member of this House is very focused on this. You can tell that by the demeanour that is present today in the House. We are focused on this because we know that some communities see this as very positive. Some communities do not see this as positive.

FPI wants another commitment of public funds. They want a commitment from government of public funds. They want to be able to sell their most profitable arm, their marketing operations in the United States.

One of the questions for us, and for the people of the Province, Mr. Speaker, is any company, not just FPI, but any company looking at selling their most profitable arm, part of their most profitable operation, does that give them a better chance of survival or does it not? I guess that, in part, depends on what they do with the proceeds by selling that part of their operation. Do they stand a better chance to survive by selling their marketing arm? Mr. Speaker, FPI stands to raise $100 million by the sale of their marketing arm in the United States. Are they putting enough of that investment back into the Province? Are they putting enough of those proceeds back into communities like Harbour Breton? We know that with some communities they are. We know that there is a new plant for Bonavista. We know that there is a new secondary processing operation for Fortune. We know that there is $1 million going to go into research and development, provided that is met by a matching government grant from some government agency. We know that they want an interest free government loan to go with that. We know that there is $3 million for Harbour Breton. We know what they are putting in.

The question is: Is it enough? Are they putting enough back into the Province? Are these investments enough as a tradeoff for selling their marketing operation in the United States? That is one of the difficult questions that we, as members, all of the members of the House, are charged with here today. That is one of the questions that the people of the Province are asking. The question, I guess, is an easy one for towns like Bonavista or Fortune to answer. It is an easy one for Marystown, Port au Choix, Port Union, Triton and Burin to answer, because we know that those plants are guaranteed to stay open for the next five years, or at least there is some guarantee that those operations will stay open for the next five years. Harbour Breton is also asking: Is this enough? Is there enough money going back to Harbour Breton?

Mr. Speaker, I guess the question is this, and the people of the Province are probably also asking and we as legislators are asking: Are the people of the Province happy with the investment that FPI is putting back into the Province? Are we, as legislators, happy with the investment that FPI is putting back into the Province? That answer depends on who you ask. That answer depends on what communities you ask. The people of Harbour Breton, who have dedicated many years to Fishery Products International, feel that they are not getting enough out of this arrangement. The provincial government has pressured Fishery Products International for a better deal for Harbour Breton. I know, because I sat around the table, Mr. Speaker. I know that the provincial government has pressured Fishery Products International for a better deal for Harbour Breton.

The federal government has not yet stepped up to the plate, and that is a little bit disconcerting. That, Mr. Speaker, says a lot about where the federal government look at rural Newfoundland and Labrador as well. FPI are saying that they can do no more, Mr. Speaker. They are saying that they want us to bring this issue to the House of Assembly, unamended, and force the members of this Legislature to make the decision on whether or not the investment that they are putting back into this Province is enough. They may or may not like the answer. I say it is not too late for Fishery Products International to come back to the table and have another look at the investment they are putting into this Province as a result of this arrangement.

We all understand what this means to Harbour Breton. This is not a decision that any member of this House is taking lightly, Mr. Speaker. This is an important issue, and I will say that every member of this House has removed politics from this issue. We can see that by the level of debate. That just speaks to how important this issue really is.

Mr. Speaker, we are all weighing very, very carefully the pros and cons of the outcome of the vote on this particular issue. The decision by each and every member here will not be made lightly. Some districts see this as good news, some districts are still wondering, some communities see this as very positive, and some do not see it as being so positive. The decisions that we make in this House, not only on this issue but on a number of issues, obviously are very good for some communities and not so good for others. What we have to focus on when we make a decision in this House is, even though it may not be good for some communities, is it good for the Province as a whole? Is it a positive decision for the Province as a whole Province?

Mr. Speaker, I am not yet convinced that the investment that Fishery Products International is making back into the Province is good for the Province as a whole Province. I am not yet convinced, and I have not yet decided which way I am going to vote on this issue, but I know that FPI can perhaps make my decision a whole lot easier. We are asking them to come back to the table again. Mr. Speaker, we all make decisions in this House, we all vote for what we feel is best for the Province as an entire Province. We know that this decision, whatever happens here, will be seen by some communities as positive and some communities will see it as negative.

Mr. Speaker, I am saying here today that I have not yet decided which way I am voting. I am very sincere about that, because I have looked at this issue and I thought I had my mind made up, but the more I think about it the more I am unsure of which way I am going to vote on this. While we are at the eleventh hour on making this decision, there is still room to satisfy each and every community that is going to be affected by the decision that we make here.

On that, Mr. Speaker, those are the comments that I have made. I thank all members of this Legislature for taking this issue as seriously as they have taken it and not making it a political issue and not using this issue as a political issue, but taking it very seriously, because it is very serious and it will have implications for the entire Province, positive or negative. I thank the members of the Legislature for their input and for allowing me to make mine.

Thank you, Mr. Speaker.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The hon. the Member for Bay of Islands.

MR. JOYCE: Thank you, Mr. Speaker.

I rise today to speak on the changes to the FPI Act, Bill 41. I agree with the member opposite, that this is a tough day for all Members of the House of Assembly. It is a decision that we have to make tomorrow that is going to affect a lot of people in the way that they traditionally live and traditionally work, their lives, their livelihood and their families. It is a tough decision.

I feel kind of relieved for the people in Fortune. I am glad for them, the people in Bonavista and that area. They have some hope, they have some good news, and I feel glad for them, but we must not forget Harbour Breton. What really sticks in my mind is Harbour Breton. When I travelled with the All-Party Committee with the FPI hearings, Harbour Breton was down there and I met a lot of the people. I know people from that area. Fortune is great, and I understand the hope, and that they can see some bright light for the future in Bonavista. God Bless the people in Bonavista and Fortune, but Harbour Breton is another story, and the surrounding communities. Without this fish plant there are a lot of communities on the whole Connaigre Peninsula that will suffer because of this.

I always look at and say: Why do people think that we all have the obligation, if not the legal belief, the moral obligation to Harbour Breton and the other communities, mainly Harbour Breton, that there has not been a solution for.

I just go back to the Premier, and this is in no way going to make it political, but it just gives the view of why people think that this Legislature, all of us in here, the whole forty-eight, forty-seven of us now, can make a difference. I just go back to the Premier's statement of January 22, 2002, when he stated that the position of the PC Party was consistent since 1999 when the leader, the Member for Kilbride, who was the Leader of the Opposition - here is what the Leader of the Opposition said at the time: I would tell my potential developers, who want to fly in the face of legislation here, beware. This legislation, if I were the Premier I would stand up and say, beware. I will use whatever is in my power, whatever legislative lever is at my disposal, to protect the people of Newfoundland and Labrador. When we see statements like that, and they came from both sides - this is in no way being political, but it is a factual statement - it shows that people really do believe we have the power to make changes, and we do. We can always say we have pressure on them or we can push them as far as we can. I just find it strange that we hear one day that the government pushed them to the wall for everything we can get, we cannot get anymore, and the next day we find the community leaders, in one case the MHAs - in two cases the MHAs were involved with negotiations. Fine, we will get a better deal. So, were they really pushed to the wall? This question has to be asked, because if one day a Minister of the Crown says they were pushed to the wall, the next day we find two MHAs who met with the groups themselves, and when they met with the groups they would get better deals. I doubt very much that the deal is as good as people say it is and if they were actually pushed to the wall.

Mr. Speaker, this issue goes well beyond this Legislature. This is rural Newfoundland and Labrador. This is the ultimate industry which will affect Newfoundland and Labrador for years to come. The Premier stated on a show: The government has the whip because the legislation is where it is ultimately going to rest. That is why people think that we, as members - and this is why I ask all members to think seriously before they vote on this. Everybody in this Province feels that the people in this Legislature can make a change for Harbour Breton. We have said it, the people opposite have said it on numerous occasions, that we can do it, and the people in this Province think we can do it, expect us to do it, and we should do it.

On April 10, on the Fisheries Broadcast, the same comments by the Premier: I would make sure I go back to my Legislature, make sure that it is as tight as it can be to protect the people of rural Newfoundland and Labrador affected in the fishing industry. Again, I look at Harbour Breton. It is a main player, and we must go back and find some way to help out with Harbour Breton.

During the FPI hearings, Mr. Speaker, I kept a lot of notes. One of the notes I kept was a submission made by a lady from Harbour Breton. I just want to read it, Mr. Speaker. May 1, 2001: No one really realized, only us, what a black day this was. The takeover of FPI left a lasting impact on the workers of our plant and the community. In eight short months it has become evident that the promises would never be kept. In the weeks that followed, in meetings that were held with Mr. Rowe, Mr.Crosbie, it was stressed: No layoffs, no plant closures and workers have nothing to fear. She went on to say: We implore the government to ensure that the provisions of the FPI Act protect the workers and the communities. Give them a future. If not, this will only be a glimpse of what the future holds for us. How true this lady was, how true, in the statements that she made down there back in 2001. How true this lady was.

If you want to talk about commitments, the people opposite - and I know some people were not even around when we held the hearings. When the hearings were held, there was people on both sides. The communities were making submissions and the dissident board that was trying to take over, they made commitments. Here is what was given to the government at the time, the Committee, and here is what was given to the communities all over. It was given to all of the communities, that they had nothing to fear. Here is the submission that was made by the dissident at the time, when they took over FPI. I can show anybody over there a copy of it. They can have a copy of it. Here is what was said: On this basis, the task force proposed a reconfiguration of FPI's groundfish plants to provide the needed process technology and equipment to allow each plant to operate with greater efficiency and specialization.

Here is what was promised back in 2001-2002: Marystown would become a specialized low cost, flat fish processing operation; the installation of new European style flat fish processing lines; a modernized raw material, handling, holding and grading system; and I could keep going. Fortune, which specialized in processed FPI harvesting turbot and inshore groundfish required the installation of two (inaudible) flow lines, the installation of two IQF individual quick frozen (inaudible) tunnels.

Here is Harbour Breton. This was given to all the people at the time. These are the commitments that were made. This was given by the board that is in place of FPI as we speak. These are the commitments by the board that took over FPI. These are the commitments that they made. I can show every member. They can have a copy and read it themselves. Harbour Breton would receive the new IQF freezing technology, raw material defrosting, handling and grading equipment and flow lines to enable this plant to engage in H and G cod production offsetting Harbour Breton dependent on the diminishing stocks of redfish resource, thereby ensuring a future for this facility.

Here is the kicker, I say to the members opposite. Eventually, as additional substantial investments would be required to restructure the Harbour Breton plant, which is in a state of despair - that was the commitment that was made back in 2001-2002.

I will just go on a bit further, Mr. Speaker. This dissident group that is looking for votes, that wants to take over and get in their Board of Directors - the person who sent out a proposal to all was John Risley. I am sure it was with consent of the other boards that took over. Here is what John Risley said to all the voting members of FPI to get control of the Board of FPI. Here are the commitments that he made, as Chairman of the Board, as the dissident group when he became Chairman of FPI.

Under the current board, FPI has not reinvested enough capital in its facilities to keep up with innovation and to the low cost producer. This gradual erosion of its competitive position reduces the value of the company and your investment. Here is what John Risley says on behalf of the dissidents. The dissidents are committed to ensuring FPI remains dedicated to its core values, quality, honesty, innovation and team work. The changes in direction that the dissidents are proposing regarding the FPI facilities are, to have an open view towards technology sharing and plant transfer within the fishing industry, and to seek new resources of new products by investing in state of the act technology for Newfoundland based companies. The dissidents believe that FPI can increase its profitability, while at the same time improving the quality of work the company provides for its employees. The dissidents do not intend to close any of FPI's processing facilities in Newfoundland or elsewhere. In fact, by reinvesting in these facilities and by seeking the new sources of raw materials, FPI will be in a position to increase the number of Newfoundlanders it employs. That was the commitment that was sent out to all voting people for FPI back in 1991 when they wanted to take over. That was sent to everybody. That was the commitment that was made in the presentation and the circular was sent out to all voting members. Have they lived up to the commitments is the big question that we must ask.

I use, again, the Premier. After these comments, and we can see what happened, here is what the Premier said about John Risley. The Premier said it on the Fisheries Broadcast: I should also point out that John Risley made oral commitments to the people of Newfoundland and Labrador and tried to renege on these commitments. His reduction of bonuses, his attempt to affect significant layoffs, his backhanded comments about the changing culture of our people, and his company's reversed reference to Newfoundland and Labrador as a third-world environment, have done nothing to endear him to the people of this Province. His actions are not acceptable practice in the business world.

That is what the Premier said. Once again, these are very strong comments, extremely strong comments. If we look at January 22 - once again these are the Premier's own words - FPI say they are not going to lay off workers. Will they then have to be held - I mean, businesses cannot come into our Province, make promises to us just so they can go out on the good side of us and then double-cross us at the end of the day. They need to be accountable.

So we had the Premier, on two or three occasions, coming out and criticizing the action of John Risley, and the question must be asked. We all know that promises were made. They are all in black and white. For anybody opposite who never saw them, they can definitely come over and I will give them a copy if they need a copy.

The ironic part for someone like me, who is travelling around on the FPI committee, when we go around on the FPI committee and we hear all the stories and we get the submissions from, at the time, the dissident group, they are going to rebuild this plant, rebuild that plant, modernize this plant, and they are going to increase the employment level in Newfoundland and Labrador, and when I look at the copy of the agreement - here is the agreement.

If the people who were travelling around, and I know the Minister of Fisheries then was on the committee, and the Member for Bonavista South was on the committee, and if you hear all the commitments and all the promises that were made, and you look at the agreement that was presented here, and you look at number (10), Good Faith, "The parties agree that they shall act in good faith in the fulfillment of all the commitments and obligations of the Agreement."

Mr. Speaker, there were a lot of us at those committee hearings. A lot of us heard those promises for those communities, and there are a lot of us right now who are saying: Can we trust FPI? Can we trust them to fulfill the commitments that they made?

Are they going to build a plant in Fortune? Let's hope so. Are they going to build the plant in Bonavista? Let's hope so. They promised in 2001 that they were going to do it. They promised in 2002 that they were going to do it. They promise again that they are going to do it, but are they going to do it?

When we asked questions this morning - I know the Leader of the Opposition asked questions this morning and the questions were around: Well, what safeguards do we have in there? With the Premier standing up himself and saying we have no guarantees, to me, as a person, it is frightening. It is frightening for me, as a person, that there are no guarantees.

I know the Minister of Fisheries said on several occasions this morning that they pushed as far as they could. I understand that. I definitely understand that. We, as a group, we, as the elected members, have to find a way, we definitely have to find a way, to hold their feet to the fire, to ensure that the commitments that were made are kept. We have to do it. No matter what else happens in this Legislature - if the Income Trust has to be done, fine, go ahead and do it, if they have to be competitive in the world market and this is the only way to do it, if the experts say this is the only way to do it, fine, go ahead and do it, but there are two things that we have to do before this agreement is finalized in this House, Mr. Speaker. One, is find a solution for Harbour Breton somehow and fulfill the commitments they made back in 2001-2002, and two, the second thing that we must do, is put in some kind of ironclad guarantees so that the people in Fortune will have their plant which they deserve and the people in Bonavista will have their plant which they deserve. If we can get those ironclad guarantees and we can find a solution for Bonavista I think we would do well for our Legislature.

AN HON. MEMBER: Harbour Breton.

MR. JOYCE: Harbour Breton, sorry. I think we can say we did well for the people of Newfoundland and Labrador.

Mr. Speaker, with that I am going to put in an amendment to the bill that was put forward, or the amendment to the bill. I will read the amendment, and I believe it is in order, but I will give the Speaker a copy to ensure: "that all of the words after the word "That" be deleted and the following substituted thereafter: "This House declines to give second reading to Bill 41, An Act To Amend The Fisheries Products International Limited Act, because the companies shellfish quotas and primary groups fleet of vessels are not included as security in the default provisions of the terms of the proposed agreement with FPI."

Mr. Speaker, I move that amendment

AN HON. MEMBER: Are you moving (inaudible)

MR. JOYCE: Yes. My reason for moving this is that if everybody agrees that this has to happen, let us, as legislators, put in the safest guarantees we can to ensure that FPI - not on their track record, because if you go on their track record we would not be here listening to these commitments - but ensure that the commitments they have made to rural Newfoundland and Labrador, the commitments that will keep rural Newfoundland and Labrador alive, will help out a lot of communities on the Burin Peninsula and in the Bonavista area, and lets hope we find something for Harbour Breton. If we can find ironclad guarantees, and if - and I am only saying if, Mr. Speaker - if there is some reason that they may come back and say, well we cannot do what we promised to do, at least there is something over their heads, something that is a bit more substantial than the groundfish operation, that they would second guess and come back and say, we have to find a way. If we lose rural Newfoundland and Labrador - it is the heart and soul of Newfoundland and Labrador, and we have to ensure that, as legislators of this Province, we do the best we can. If we can do the best we can and it fails, we can all stand up and say to each other, we did the best we can collectively, as a group, to help save rural Newfoundland and Labrador.

Thank you, Mr. Speaker, and I will present the amendment.

MR. SPEAKER (Fitzgerald): Order, please!

The hon. acting Government House Leader.

MR. RIDEOUT: Thank you, Mr. Speaker.

I was going to suggest that since none of us on this side of the House have seen the amendment yet - I do not know if the Chair has - that we should perhaps take a brief recess to have a look at it. That is a suggestion, if the Chair is so inclined.

MR. SPEAKER: The Chair has not seen a copy of the resolution as put forward by the Member for the Bay of Islands, so the House will now take a very brief recess and have a look at the amendment as put forward by the member. We will reconvene very shortly.

The hon. the Government House Leader.

MR. RIDEOUT: Yes, Mr. Speaker.

Thank you, Mr. Speaker.

I would also like to suggest, before a final decision is taken by the Chair, that perhaps we ought to come back in case there are arguments on whether the motion is in order or out of order.

MR. SPEAKER: The Chair will take the amendment, and if the Chair decides that the amendment is in order, the Chair will rule it in order or not in order at that time.

This House now stands recessed briefly.

Recess

MR. SPEAKER (Fitzgerald): Order, please!

The Chair has had an opportunity to confer with the Table with the amendment as put forward by the hon. Member for the Bay of Islands. That amendment reads: "That all of the words after the word "That" be deleted and the following substituted therefor: "This House declines to give second reading to Bill 41, An Act To Amend The Fisheries Products International Limited Act, because the companies shellfish quotas and primary groups fleet of vessels are not included as security in the default provisions of the terms of the proposed agreement with FPI."

The Chair deems this amendment to be in order.

The hon. the Member for Windsor-Springdale.

SOME HON. MEMBERS: Hear, hear!

MR. HUNTER: Thank you, Mr. Speaker.

I love to get the opportunity to say a few words about Bill 41 because it has such a big affect on my district, as well as my colleagues here in the House of Assembly. Mr. Speaker, this is about all rural Newfoundland. It is about a bigger issue than just one community and one fish plant. It is a bigger issue than a plant in Triton, a plant in Bonavista, a plant in Marystown, a plant in Burin, or any plant that FPI operates. This is an issue that affects a lot of people in rural Newfoundland and Labrador.

I have to say, Mr. Speaker, that I have to commend the Premier for working so hard to try and find a solution that could bring closure to the concerns of people in rural communities, particularly in communities that have FPI plants. It is not an easy task to do that, because sometimes we have to take advantage of opportunities and opportunities come very seldom to communities like Harbour Breton where they are trying to see a bit of light at the end of the tunnel when it comes to having to protect the workforce and the industry in their own community. This is such an important issue for them and for other communities that we have to be very careful.

Right now I am swinging back and forth wondering where I should go on this. I think other MHAs in their districts are probably doing the same thing, because we are very concerned about the situation with the FPI proposal. We understand in all of the details that have been laid out to us and all of the facts and figures that we have, that this is a die or do for FPI. If we do not do this, with respect to having capital to expand their operations to make FPI more viable, profitable, and to be able to expand into bigger markets to diversify in species and to upgrade plants that exist in the company's assets, we have to understand that if we do not then what is the alternative. Apparently, a lot of the people who know a lot more about finances than I do suggest that this not a bad thing to do. It is a pretty acceptable practice to have an Income Trust Fund set up so that the company can get the money they need to do these things they need to do, without going to the major banks to do that.

If we are going to look at the reasons why they are doing it, it can easily be defended that this decision is probably going to be the best alternative for the company. Then again, it goes back to, I guess, moral responsibility in the communities that we serve as MHAs and the corporate commitment that FPI has to the communities. Do we not do it and take a chance on next year having to decide what plants will close, how many people will be gone, laid off from those plants, or do we do it and have a commitment that FPI has made to us for five years, that our plants will survive and keep on running? Then, after that, I guess, we will know where we are going in the future.

I have to say that I have talked to a lot of people in the last couple of days and the last week, trying to understand what the people in my district want me to do. It is still confusing, it is still complex, and it is still at a point now where what comes forward in the next twenty-four hours is going to make me make that final decision.

I have to be very concerned about the whole issue of the FPI proposal. Fourteen months ago we were dealing, basically, with the same proposal that is here today, but this government is in a far better position today, after fourteen months of our Premier and our government negotiating and talking to FPI and trying to get commitments, trying to get more things done in our communities with FPI plants, trying to make FPI more accountable, trying to tell our people in rural Newfoundland that we are concerned that, when we make the decision on a deal such as this, then it is going to be to everybody's benefit.

With the Income Trust, with possibly $100 million that will be acquired by the company, that is not going to jeopardize the control of FPI. The 40 per cent that will be sold will bring in almost $100 million of which $30 million is going to be paid down on the debt of FPI in their operations. That alone is going to make FPI more attractable. It is going to make it stronger and it is going to give more confidence to the company so that they can go out and acquire new techniques, new equipment, and new market places.

Mr. Speaker, I think a lot things we are hearing today are based on trust with FPI. I have to say that in my district, in Triton, FPI has been a good corporate citizen. They have maintained the plant very well over the last number of years. They have kept a lot of commitments that they have said they were going to keep and they are doing a very good job in there with respect to training the workforce and maintaining a good healthy workforce. Unfortunately, the resource sometimes is not there to maintain the full employment. We have to recognize, no matter what agreement we make it is still going to be based on the availability of the resource and, of course, the viability of that plant. With a company as big as FPI, then they are going to have to make decisions regardless of what agreement we decide they could have. In years to come, who knows what is going to happen. I think that uncertainty is what is on the minds of a lot of people, not only in my district but in other districts that have FPI plants.

The question I have heard the most in the last couple of days is: What happens after five years? What happens if the resource declines and the quotas decline? Where do we go from there ? Those are questions that I do not think anybody can answer. I think we just have to wait and see if the stocks are strong enough to maintain, of course, the harvesting levels and the quotas each plant has. There is nobody who has a crystal ball, who can look beyond even a couple of years when it comes to the stocks.

Mr. Speaker, I did have a lot of satisfaction in hearing from the people who are directly affected. The satisfaction that I have gotten is that they are putting a lot of trust in this government to make the right decision. I have heard that so many times, that they have said: Well, we know the Premier is not going to give away a resource. We know the Premier is going to make the best decision for the people. In my district, particularly, I am hearing that a lot.

I think, throughout the Province, there are so many diversified communities, so many different opinions on what we should be doing in the fishery. I cannot speak for other districts. I know there are some members who are having a tough time trying to decide between what they should do and what they are going to have to do, and I guess a lot of it depends on what comes in the next twenty-four hours respecting Harbour Breton. We all would like to give full support to Harbour Breton, myself personally, because it is a neighbouring district. I am very concerned about what happens in Harbour Breton. I visit Harbour Breton many times. Even a couple of years ago, Mr. Speaker, yourself and I, and now the minister, went to Harbour Breton in a major snowstorm to meet with the fish plant workers. Even back then we saw the concerns that they had. We want to try and do the right thing for the people of Harbour Breton.

Now we see this light at the end of the tunnel, that there is a chance that something might happen. We have to recognize that not only does the Province have a responsibility to what is happening in Harbour Breton, the federal government does too. We are not seeing a lot of things coming out from the federal government with respect to the Harbour Breton issue. Why aren't they coming onside and trying to find a solution acceptable to everybody? Why aren't things being done to encourage even FPI or federal fisheries to find a quota for Harbour Breton. They can have all of the infrastructure they like, they can have all of the money they like to upgrade the plant and everything, but if there is nothing to do in that plant then they are still not going anywhere. On that alone, I think a lot of people who I have talked to, a lot of my colleagues, are very torn between what they know the people in their districts say they have to do and what we should do to protect our neighbours, to help our neighbours. I am no different. I find it very difficult trying to make a decision on what I am going to do tomorrow with respect to voting on this bill.

Having said that, we still have twenty-four hours. We have still have some negotiating time. Hopefully, by tomorrow something good will come out with respect to Harbour Breton, something that not only the people of Harbour Breton but the people throughout the Province in other fish plant communities will accept.

Mr. Speaker, we face all of these different issues in our districts when we have a diversified district. I have such a big diversified district, it is not only fishing, it is mining, forestry, big business, small business, and every day it seems like we are facing issues concerning what government should be doing to protect jobs in rural Newfoundland. This one is a very big issue for some of the districts who only have fishing and plant workers in their districts. How do we handle that, how do we protect these people, how do we do the right thing, without proper negotiating and a lot of thought put into it, which our Premier is doing today? He has spent a lot of time dealing with the different stakeholders trying to find a solution to this.

I am not trying to prolong this by trying to say a few things that probably would not mean much, but I am saying that in twenty-four hours I will make a decision on which way I will vote. I did get a loud and clear message from my district, and tomorrow I will let the people know that I will do what I will have to do for the people of my district. I am hoping that by tomorrow we will have a really good solution to the problem in Harbour Breton. I am just going to conclude by saying that, Mr. Speaker.

Thanks for the opportunity to have a few words to say on this very important issue.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: Order, please!

The hon. the Member for Grand Bank.

MS FOOTE: Thank you, Mr. Speaker.

I rise today to speak to Bill 4, and I do so with mixed emotions. Clearly, I feel the pain and the anguish that the people in Harbour Breton are feeling. It is devastating to listen to them and to know that they really do not know where to turn. I know they are doing everything possible to try and convince FPI and the government, working with their union, to find a solution, an acceptable solution, for the people in the community of Harbour Breton; and not just for the community of Harbour Breton but for the entire Connaigre Peninsula. I can relate to that, Mr. Speaker, because I know that the news we have with respect to Fortune is good news. It is news that I welcomed as the MHA for the area. It is news that made it possible for me to look at this request from a company, from FPI, to look at it in a different light and to find a way to say yes to their request to establish an Income Trust.

I guess, first and foremost, we are all concerned, as members of this House of Assembly, about our Province, about Newfoundland and Labrador. I think many of us who represent rural districts are really concerned about the plight of the people who live in rural Newfoundland and Labrador. First and foremost, my responsibility must be to the people who elected me. That would be to my constituents in the District of Grand Bank. I know that they, too, feel for the people of Harbour Breton and others, of course, who work in the plant or worked in the plant in Harbour Breton. They, just as I do, hope that a solution will be found that will see meaningful employment again exist at that plant in Harbour Breton.

Having said that, I have had to deal with a lot of personal issues for people, for constituents, in my own district, who have found themselves in a similar situation that the people in Harbour Breton and surrounding communities find themselves in today. There is nothing more difficult than to try and deal with issues for your constituents knowing that sometimes you cannot deal with them, that you do your best, but at the end of the day that is all you can do is your best.

I know what it is like to be approached by people who do not have money to buy clothing for their children, to put food on the table, to put gas in a vehicle. People have vehicles that they cannot drive because they cannot afford to licence them. People, out of desperation, need money so they can leave this Province to move to another province to find employment, and they come to you looking for this type of assistance. The anguish that we are hearing from the people of Harbour Breton, and others who worked in the plant in Harbour Breton, I am sure those of us who represent rural districts in particular, are only too familiar with this type of request and know how difficult it is for these people.

While I stand here today with mixed emotions, I have to be happy for my constituents who have some hope. I credit the union, I credit the leadership of the union, for putting Fortune on the table, for suggesting that the secondary processing be done in Fortune. I credit the company for agreeing to do that, because it does mean that there is a light at the end of the tunnel for people from eight communities, because that is where the people come from who work at the fish plant in Fortune, it is not just the Town of Fortune. I know, just as many of us again who represent rural districts know, that if the main employer falls by the wayside or closes shop, we know the impact that has on other businesses in the area.

While we talk about a fish plant that at one time in Fortune employed in excess of 300 people, we know that if that plant does not open not only will that plant be affected but all of the other business, the gas stations, the takeouts, the convenience stores, and the employees who work in those businesses - so you are talking a multiplier effect. Another 200 people would be out of work. The news that the Fortune fish plant will see a new life, that there will be a processing line go in that plant, was really received with great emotion because it did indicate a future for about 200 employees. Now we know there will be some people who will not find work, and that is why the urgency of an early retirement package, that is why it is so important for this government to talk to the federal government to put a concrete proposal forward, to have in-depth discussions with them, about moving forward quickly with an early retirement package, so that the people who are not going to be able to find employment will at least have something to rely on, something to look forward to.

Supporting FPI's request for an Income Trust is not a difficult thing for me to do, because I understand it is a business, FPI is a business. It must be a profitable business or the entire Province will lose. I know, too, that the Board of Directors must be confronted on a daily basis, given the situation in which they find themselves, must be confronted on a daily basis by the shareholders who expect to receive a return on their investment. That is to be expected, that is what business is all about, but we can never lose sight of that other aspect of this company called Fishery Products International that has existed in our Province, that has done a good job in our Province, and we want to see them to continue to exist. If that means that they have to create an Income Trust so they can attract the kind of investment they need to ensure that the company continues to be a profitable company, then it is hard for us to vote against that, recognizing that they cannot go to the banks anymore. They see the Income Trust as a way of ensuring that the company will succeed.

We cannot lose site of the other shareholders. Those shareholders have a big stake in this company. Those are the employees, Mr. Speaker, the employees of FPI who have worked so hard to build the company, who have made it possible for the company to grow, and who, today, are still looking to the company for a future. I know that in Fortune the concerned citizens committee have held meetings with the union, they have held meetings with the company, they have held meetings with the Premier, and they were successful in convincing all who had a role to play in making the decision to have that processing line put in Fortune. I would like to think that is part of the future for the company.

I know, too, that there was a concern being expressed in Burin, because they did not want anything to happen in Fortune that would impact negatively on the operations in Burin. I know that they have been given that assurance by the company. I know that Marystown, too, have concerns, and they have been given assurances by the company.

My colleagues have stood today, in Question Period and since then, to talk about the lack of guarantees, and I, too, can relate to that. While I have letters signed by Derrick Rowe, the CEO of FPI, written to Earl McCurdy, the President of the Fish, Food and Allied Workers, giving these assurances, I hope that, as I said to Mr. Rowe in a telephone conversation with him, I can take these to the bank, that they are, indeed, worth the paper they are written on, that they are, indeed, something that we can look at and say, this is a good assurance, this is something we can count on, that based on these letters and the discussions that the company had with the union, we will indeed see $8 million invested in Fortune, we will see a new plant in Bonavista. What is missing from this, and what makes today a difficult day, is that we do not have anything that Harbour Breton feels comfortable with.

I, too, believe that if we all work together, and I understand that discussions are ongoing, if we all do our very best, recognizing that if Harbour Breton does not survive the entire Connaigre Peninsula is at stake - I do not think that anyone in this House of Assembly wants to see that happen. Those of us who represent rural Newfoundland and Labrador know only too well the hardships that people face in rural Newfoundland and Labrador, know only too well how difficult it is sometimes to find employment, so that when you have a major employer, like FPI, you kind of look to that employer and you respect that employer and you do your best job that you can for that employer, because you want them to stay. I think FPI would be hard pressed to say that they do not have a good workforce in our Province, a workforce that has delivered for them year in and year out. Now, what is being asked in return is that FPI make it possible for that work to continue. How they do that, I think is something that is going to take the government, the Premier in particular, working with Mr. Rowe and working with Mr. McCurdy to find that solution. It has to be there, so that all of us can stand in this House of Assembly and take pride in Bill 41, take pride in being able to say we supported a company that has been good to Newfoundland and Labrador, but of course Newfoundland and Labrador has been good to the company as well. We need to be able to pass this legislation with pride, knowing that in doing so rural Newfoundland and Labrador will survive, that Harbour Breton will survive, that Bonavista will survive, that Fortune and the surrounding areas will survive.

There are eight communities that are impacted by the fish plant in Fortune, people who live in those communities, who go to work daily at the fish plant in Fortune. We are not just talking about the impact on one community, when you talk about that significant investment in Fortune. That is why I did have some concerns when I initially saw, in the Terms of Reference, that the investment in a second line was going to be on the Burin Peninsula and did not specifically spell out Fortune. I know the concerns that were being expressed by the Town of Burin, but you know, at the end of the day - and I am pleased that the Town of Burin has been given the assurance that they will not be negatively impacted by this decision. It was the right decision because what it does is ensures the survival of not one community but several communities, whose people work in the plant in Fortune.

As I said at the outset, when I stand here today with mixed emotion it is certainly elation because Fortune has been given a reprieve, that the concerned citizens' committee that worked so hard, that the union that has worked so hard, that the Mayor of Fortune who has worked so hard to make this happen, that they have been successful. I hope that the Premier, working with Harbour Breton, will be able to find a solution. It has to be there, there has to be a solution for Harbour Breton, just as there has been found a solution for Fortune and Bonavista.

We are talking about people who, if we do not find a solution for them, really will have nowhere to turn but leave this Province. We do not need that in Newfoundland and Labrador, we do not need more out-migration. In fact, we need to be working to ensure that people return to this Province. As the Member for Bonavista South said, he spent a great many years working in a fish plant. It is not easy work. They are very proud, independent individuals who give their best, and now they need our support. They need us to make their case, they need us to stand up for them, to support them and I am pleased that has happened for Fortune and for my constituents. Because it has happened for my constituents, and as the MHA, I have to support Bill 41.

I am hoping that when it comes time to vote, that when I do vote I will be voting because Harbour Breton has also been taken care of, that indeed the company - and I am sure they too want to find a solution. I mean, who does not want to find a solution? I cannot imagine that FPI is taking any pleasure out of the hardship that is being endured by the people of Harbour Breton.

I think a sober second thought is warranted and, I think, working with the Premier, working with all of us to find that solution, that we can find it. It might take a little more time, but I would like to think that, before we have to vote in this House of Assembly, we will do so knowing that not only is there a life for Fortune, not only is there a life for Bonavista, but there is also a life for Harbour Breton and the Connaigre Peninsula. We must be able to find a way to do that. I think you can tell, by the demeanor in this House, that we all see this as an important serious issue.

I think the Premier and the Minister of Fisheries and Aquaculture mentioned that they have been at this now for eighteen months. I know it is not easy. It is never easy, particularly when you are dealing with a business that has massive holdings, that has to answer to its shareholders, that has to look at the stock market. It is never easy trying to find that happy medium, but we must find it. I believe that the leadership of FPI want to find a solution, just as those of us who are speaking to this bill in the House of Assembly today want that solution to be found. I think we all have to be part of the solution.

Someone earlier referenced the federal government, and they are absolutely right. Some of the issues we are facing, some of the difficulties we are facing, are as a result of decisions or lack of decisions or lack of action by the federal government. There is a role here for the federal government just as there is a role for the provincial government and municipal governments. It has to be a partnership and, by working together, we will find that solution.

Again, I mention the urgency of an early retirement package, because I am concerned that even though the proposal for Fortune will see employment for about 200 workers, there are, in fact, another 100 people who will not find employment. Just as we are concerned about the people in Harbour Breton and the fact that they may have to leave the Connaigre Peninsula, or will have to leave if a solution is not found, the same holds true for my constituents, for those people who work at the plant in Fortune but who will not be part of the solution or will not be part of the announcement. An early retirement package is essential. Again, I impress on the government to get moving on this, to get a proposal forward to the federal government, and make the federal government a part of the solution.

I am sure that even when we are able - and I say when we are able, not if - to find a solution for Harbour Breton, it probably will not take care of all of those who have worked at the plant in the past, even as we were not able to take care of all of the employees who work at the plant in Fortune. There must be something for those people. You are talking about people who are fifty, fifty-five, sixty years-old. Where are they going to go to find employment? They are not. These people have worked so hard in the fishing industry, can we expect them to try and survive by asking the government -

MR. SPEAKER: Order, please!

I remind the hon. Member for Grand Bank that her time has elapsed.

MS FOOTE: Leave, Mr. Speaker, just to clue up?

MR. SPEAKER: By leave?

AN HON. MEMBER: By leave.

MR. SPEAKER: The hon. member, by leave.

MS FOOTE: Thank you.

Mr. Speaker, I think the onus is on us to do everything we can to support those individuals who now find themselves in a position, through no fault of their own, a position that they really do not need and do not deserve to be in. I am calling on the Premier to continue to work on behalf of the people of Harbour Breton to find that solution, working with FPI, the solution that will ensure they can continue to earn a living in the town that they have grown up in, live in, work in, and where their friends and family live.

I want to conclude by saying, I am pleased with what has been achieved for Fortune and the communities surrounding Fortune, and certainly for Bonavista as well.

Thank you, Mr. Speaker.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: Order, please!

The hon. the Member for Lake Melville.

SOME HON. MEMBERS: Hear, hear!

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

It is indeed a pleasure for me to stand in this hon. House today and to talk on this very important issue.

As many of my colleagues in the House of Assembly know, this is not a big issue for the District of Lake Melville, but it is indeed a major issue for the Province of Newfoundland and Labrador.

Mr. Speaker, I want to say up-front, that having met with FPI officials and having met with Mr. Derrick Rowe, I did not get a nice cosy feeling that our future with Fishery Products International, in the long term, is going to be here for a long time.

I want to talk about rural Newfoundland and Labrador, Mr. Speaker, coming from a rural part of the Province. I am going to take a few minutes to talk about a small community in Labrador that has gone through this, what Harbour Breton has looked at, and that is the community of Black Tickle. My good friend, the Member for Cartwright-L'Anse au Clair, knows of Black Tickle and knows of the difficulties that small community had. I want to say, back in 1997, Mr. Speaker, when I started working for Newfoundland and Labrador Hydro and starting working the Coast of Labrador, I used to be able to go into the small town of Black Tickle and you could actually walk across the harbour on the bows of the long liners that were there. It was the number one groundfish plant anywhere on the Coast of Labrador. We had a great Northern resource, the Northern Cod stock, and today that community is struggling to survive. It is a challenge, it is a challenge for our government. We are trying to look at Black Tickle and look at what we can do for the community of Black Tickle.

Mr. Speaker, this morning when I came in I got an e-mail. It was from a twelve year old Grade VII student, Jennifer Pittman. I want to say to Jennifer here today: I got your e-mail, Jennifer. I want to read it for my colleagues, because I think it sort of says something about the community and about the families and about the young people of Harbour Breton. She says: I am a twelve year old girl in Grade VII with two parents who worked in the fish plant. If you don't give us the quota, what will we do, where will we go, and where will we get a job? Please give us the quota we need. We are a rural community and if we don't get the quota, we will be a ghost town. Please don't let this happen to Harbour Breton. She encourages me to vote no, when we vote on this very important issue.

Mr. Speaker, I believe that Fishery Products International has a commitment, a social commitment, to the rural parts of this Province. When we go back through the history of the takeover of FPI, I will say to you that there were many commitments made by Fishery Products International and there were many of them that were not kept. I can tell you, as I stand in my place tomorrow I am going to be very challenged.

The message that I want to sent to Mr. Rowe at FPI this evening is: You better get in contact with the Premier, you better get in contact with our government, because we want to see the maximum benefits of this deal, or any deal, for the rural districts in the Province of Newfoundland and Labrador, and in particular, we want to see something happen in Harbour Breton.

SOME HON. MEMBERS: Hear, hear!

MR. HICKEY: I want to make a couple of comments also on the federal government. I have to say: Where is the hon. Minister, John Efford? Where is he on this issue? Where is Minister Regan? Where is Minister Stronach? Where are all these federal ministers? They should be up to their eyeballs in this particular file. I know the Premier has made numerous contacts with them, he has made sure that their feet have been kept to the fire on this particular issue, yet we do not seem to be getting any commitments on behalf of the federal government. It is time for the federal government to come forward and pony up with some money here, and to work with the Province and the communities so that the rural parts of this Province, and in particular Harbour Breton, sustain themselves in the long-term, Mr. Speaker.

I say to Minister John Efford: Minister Efford, it is time to come back home and start dealing with some of the problems here in Newfoundland and Labrador, particularly the issues in Harbour Breton and some of these rural communities. We need to see you here, and we need to see you now, Mr. Minister.

Mr. Speaker, the federal government has not been upfront. When we look at our whole fishery in this Province, it makes one sick to their stomach, when we look at the mismanagement of the cod fishery off the Coast of Labrador and throughout the Province. We have seen our very survival, as a Province and as a people, go down the tubes. It stresses me out, to no end, when I listen to the rhetoric that we often hear coming back from Ottawa and the issues that have not been dealt with by the federal government and by these ministers. I want to say to the people of Harbour Breton and to the people of rural Newfoundland who are going to be affected by any deal, that: Hey, it is time to get the federal government on record here, it is time to get the federal ministers on record, and let's make sure that they are doing the work they should be doing for the people in rural parts of the Province, Mr. Speaker.

How John Hickey, as an MHA, will vote tomorrow, as I said before, Mr. Speaker, depends on what happens between now. I can tell you there are a number of my colleagues on this side of the House who would like to see more in this deal. The message is clear and it is straightforward: We want to see something happen for Harbour Breton and we want to see FPI put more money, more quota, and more issues on the table here for discussion with the Premier and with the negotiation officials on behalf of the Province of Newfoundland and Labrador.

From my perspective, I want to support the right thing, to do the right thing for those people, Mr. Speaker. I can tell you, I hope we are going to hear good news between now and tomorrow, because if we do not, certainly that is going to have a major influence on how many of us over here vote on this particular issue as it goes before the Legislature tomorrow afternoon, Mr. Speaker.

On that note, I thank you very much for this opportunity.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The hon. the Member for Carbonear-Harbour Grace.

MR. SWEENEY: Thank you, Mr. Speaker.

It is a sad day, I guess, for me to stand here and pass judgement on the Community of Harbour Breton. When we get elected and we spend our election night celebrating and rejoicing in the fact that we have achieved the honour of coming here to represent our people, little do we know that we will find ourselves in a situation where we have to cast judgement on the lives of other people, the lives and the future of a whole community in this instance.

I have thought about this for the past number of days. When I received the document, there was not very much in there except for the benefit of FPI, but all of a sudden there was a meeting, a teleconference, and Bonavista receives a new plant. In the same period of time Fortune receives a new processing line, a new processing operation. I congratulate those two communities for the hope that they face today, but the same time, in the same breath, in the same thought, I think about what is going on in the minds and hearts of the people of Harbour Breton.

My thoughts take me back to, I suppose, the hardships and the challenges that faced our forefathers here in this Province. It was the fishery that brought us here. The fishery brought us here some 500 years ago, and we have all struggled and we have grown as a Province, because the fishery was used as an economic engine. We have heard that word so often, when the fishery has been talked about. Right now, it is a billion dollar industry in this Province. Do you know what else that fishery has done? The fishery, besides taking away the fathers and sons of a lot of our families through the hardships that they went through and the tragedies that they have suffered on the open seas and in our bays and inlets, it has also made a lot of people rich. It has been an economic driver for a nice few millionaires in this Province and for people on the Mainland and in other countries.

Everyday we talk about the overfishing, the abuse that is taking place off our shores, but the real abuse, I think, is taking place right now. The real abuse is taking place right now in Harbour Breton. Because if you want to look at this, it is like we are being asked, because our family is no longer as productive as it was, because we have this babysitter now that we created back in the 1980s - when we go back to the history, and I will in a second, we created this babysitter to look after our family and now all of a sudden that babysitter has decided that, we cannot sustain this one community, there is no purpose, no place for this member of our family, and we are being asked to throw them out. That is sad, because Fishery Products International was created, if my memory serves me correctly, when nine fishing companies in this Province fell into financial trouble in the early 1980s. The government of the day, along with the federal government of the day, decided to put together this new fishing company that would be governed by this House, by the people sitting here, not just the members of that day but also by the members of today. That was the charge that was given to this House of Assembly when Fishery Products International was created.

Sadly - sadly! - in all of this, the fishery itself, for Fishery Products International, whether or not it was realizing its profit that they wanted, that is arguable, because what goes on in board rooms - and we have seen attempts of corporate takeovers - but shareholders want to increase their bottom line. That is why they put their money in. We have something in there too, we, the people of Newfoundland and Labrador, have something in there. We have the resource in there. We are critical, both sides of the House have been critical, over previous governments on the way they have handled their resources. Well, today we are handling a resource ourselves. We are handling a resource ourselves, because if you look at the very structure of Fishery Products International and what they are doing, the most profitable part of Fishery Products International is that American company that they are trying to divest themselves of. That is the most profitable part, the marketing part, which takes me again to why this House put them together. They were put together to market the products of the fisherpeople of this Province. That is why they were there.

If they are going divest themselves - and it says here; and I have no assurance to say that it is not just 40 per cent. It is not just 40 per cent. I cannot find any guarantee, in any of the things I have read or anything I have heard today, that they will be limited to just divesting themselves of 40 per cent. You know, some of my colleagues spoke about Icelandic Fisheries being in the position to buy up that full 40 per cent and maybe even buying more, that they would control the full marketing arm of Fishery Products International. We do not have that assurance that is not going to happen. We do have assurances from a couple of other companies, who are shareholders, that they will not purchase the shares, but we do not have that assurance.

Where does this bring us? Are we going to think we are doing the right thing and allow Fishery Products International to build their bottom line? I think their first sale, 40 per cent of their shares, will be roughly $100 million. It should be around $100 million. The math that I have had, the quick calculations, is that there is $30 million going to pay off their debt, another $7 million or $8 million for Bonavista, $3 million or $4 million or $5 million for Fortune and $3 million for Harbour Breton, but there is nothing for Harbour Breton next year. There is nothing there. What is the purpose of creating work this year at $6.25 an hour, or even through the benevolence of Fishery Products International by topping it up to $3.75, $10 an hour? What is the purpose of 400 hours and next year they come back and knock on the doors of this legislation again and say: What about us now? Our community is not there, what are we going to do?

Everyday, while we hesitate, every single day that we hesitate, there are people packing their bags and their cars and their trucks and moving off. They are going out to try to maintain some life for their family. It is heartbreaking. The Member for Lake Melville read that e-mail he received. I received the same e-mail. It is heartbreaking. There are fifty or more of those e-mails coming into us all.

I do not know, and I will ask this question: Do we need Fishery Products International? Maybe the right thing for us to do today is to strike an all-party committee, put it together, and ask Ottawa to give the quotas to the communities that they belonged to in the beginning and let these communities, and let the private sector, come in and fish and run the operations in their communities. There are fish processing companies in this Province that do not need an FPI Act to operate. They are processing fish and they are dealing with the fishermen. There are turbulent times, yes, because when anybody does business, not everybody agrees. There is a process that takes place where you negotiate, you protest, whatever you have to do, but at the end of the day there is an agreement made because, first of all, the product is in the water and it has to come out of the water and it has to be brought to some processing plant to be processed.

You look around this Province and you see people who are doing this on a regular basis, buying fish, processing it, putting money back into their business. Maybe FPI is not concentrating because we have had promises, in 2001-2002, that they were going to grow their business. As a matter of fact, Harbour Breton was one of those communities that was supposed to have a new facility. The hopes of those people were built up and they were dashed, dashed against the rocks like many of the boats who have pursued our fishery. Their hopes were dashed. Surely heavens, there has to be something in all of this that Harbour Breton - because I do not see Harbour Breton being any different, except for its isolation, than say, Bonavista or Fortune. There are living, breathing souls down there who have made their livelihood from the fishery for years and year. I think the time is here for us to stand up for those people. We have to.

Premier - and I say this to you not in any political way at all - you speak the loudest, you are the leader, the people elected you here. I say to you, tell Fishery Products International Harbour Breton is on the table or else they better start looking at their other bottom lines. Premier, I truly believe that the time is right now to balance this fishery with Fishery Products International. The easiest thing in the world to do is to give in to Fishery Products International.

I go back to some of the things, the recommendations, that were made in the All-Party Committee that took place when we had public consultations. The committee recommended that the government and FPI attempt to reach an enforceable agreement on the issue of quotas in the event that the parties cannot reach acceptable enforceable agreement within a reasonable period. The committee recommends that the FPI Act be amended to include a requirement that all current and future FPI quotas and allocations in waters adjacent to Newfoundland and Labrador be harvested by Newfoundlanders and Labradorians and processed within the Province.

Premier, we are losing our product right now to China. They say it is only a small amount, but FPI is not honouring the commitments that they made. They have not honoured those commitments. The committee recommended back then that the Act should be amended to include a preamble, and that preamble was to include a need for a company which operates on the basis of sound business and commercial decisions, without undo disruption, that historical pattern of harvesting and processing in the Province.

Mr. Speaker, I have to say, that what Fishery Products is doing right now for Harbour Breton is certainly not in compliance with that. I think, that when we are finished with this - I feel that our penalties are not strong enough. Just to lose the groundfish quotas for FPI, I think would be insignificant to them. Even if they were penalized - they broke some of those commitments they were making - they still have to lease the quota back from the government, they still have that right. There is no charge there for how much they are going to lease it back for. All you do is do it through another name. There are no teeth there. I feel we do not have the stick made big enough. Someone mentioned the shellfish as collateral. Someone mentioned the trawlers as collateral. Those are things there that companies will weigh heavily upon. The groundfish, when the dollar-value of the ground fish is not worth anything, as the Minister of Fisheries said here this morning - there is not enough in this deal.

I heard the Premier say this morning that this was the best deal that could be negotiated over the past fourteen months. Strangely enough, most of the great positive stuff has happened in the past couple of days. There was nothing forthcoming in the past fourteen months that I could gather, that has been made public to us here. I was pleased to hear this morning that the Premier is not satisfied with the Harbour Breton situation and he is looking for more to come for Harbour Breton. So am I, Premier, and so are all the members on our side here. I know what it is like, I lost two fish plants in my district in 1992, Harbour Grace Fishery and Carbonear. Carbonear made a comeback, not to what it was, the workforce is probably one-third of what it was, and Harbour Grace is not there. The plant is not even there any more, in the town. I know what it is like, going into that community and listening to them, and listening to the despair, because it never goes away. It never leaves the people, the people who are left there living in hope of somebody coming in to do something for the community.

A lot of people cannot leave their communities because they have everything, their whole life, tied into it. Their home is there. In rural Newfoundland, as we are all aware, most of the people own their own homes. You will find that the mortgages in rural Newfoundland are few and far between.

In our situation in Harbour Grace, the despair is there, and every little thing - somebody mentions that they are coming into the town to look around, to do something, but when they pull away there is more despair left there again.

I have neighbouring communities up and down the North Shore and over on the Trinity Shore, and they felt the impact of these two plants closing. They felt the impact, so I can only imagine what the people of Harbour Breton will endure, because they are down there to themselves.

We look at Trepassey, where we saw homes down there that were worth $100,000 being sold for $10,000 and $12,000, people's whole lives -

AN HON. MEMBER: A hundred dollars (inaudible).

MR. SWEENEY: Yes, and I would say $100 in some cases. This is the seriousness of what we are talking about.

As politicians, as elected representatives, it is an onerous task to do that because we have a couple of carrots held up here. We have a couple of carrots held up here, and the Minister of Justice said, well, two out of three. We have two out of three.

Well, I think before we take our vote tomorrow we should have three out of three.

SOME HON. MEMBERS: Hear, hear!

MR. SWEENEY: I think we should have three out of three, because we are not talking about songs. We are talking about people's personal lives.

You know, we are here governed by the people who put us here, but we also have an act, the Fishery Products International Limited Act, to which we are making some changes. If we are going to go through this trouble today and tomorrow to make changes to this Fishery Products International Limited Act, let's make sure we have teeth in there, that we can do something to improve the quality of the fishing industry in this Province.

We have a number of plants that depend on Fishery Products International to sell their product through their marketing arm which they are trying to sell. What happens to those people, those smaller fish plants who depend upon Fishery Products International to market their product in the United States? Those are the things that I have.

Unfortunately I have only had twenty minutes, Mr. Speaker, and it has gone by on me. I have so much more I want to say, because I look at this with the passion of a rural Newfoundlander. I live out there with people who have been displaced from the fishery. I live with them on a daily basis, and I feel their anguish on a daily basis.

Mr. Speaker, I would like to make an amendment, move an amendment to the proclamation clause: It is moved that section 3 of Bill 41, An Act To Amend The Fishery Products International Limited Act, be amended by adding, "conditional upon approval of the final agreement with the company being reviewed and approved by the House of Assembly".

Mr. Speaker, this is moved by the Member for Carbonear-Harbour Grace and seconded by the Member for Port de Grave.

I thank all hon. members for their attention while I have had my twenty minutes and, just in closing, say: Let's, each of us, listen to each other's twenty minutes and do the right thing when the vote is taken tomorrow.

Thank you, Mr. Speaker.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: Order, please!

The House will take a recess and look at the amendment, and come back with a ruling as to its admissibility.

The House is now in a very short recess.

AN HON. MEMBER: Mr. Speaker, (inaudible).

MR. SPEAKER: Order, please!

(Inaudible) asked for a comment before we leave to rule on the admissibility on the proposed amendment.

The hon. the Government House Leader.

MR. RIDEOUT: Thank you, Mr. Speaker.

I just wanted to inform Your Honour - I had not had an opportunity to do so yet - that by agreement we are now going to take a dinner break and the House will resume at 7:00 p.m. At that time I think it would be appropriate to inform the House as to whether or not the proposed amendment is in order.

MR. SPEAKER: If I hear the member correctly, we would now recess from 5:00 o'clock until 7:00 o'clock, by agreement. If that is the case, then the Chair will wait and come back with the ruling immediately after the dinner break.

The House is now in recess until 7:00 p.m.

 


June 9, 2005 HOUSE OF ASSEMBLY PROCEEDINGS Vol. XLV No. 30B


The House resumed sitting at 7:00 p.m.

MR. SPEAKER: Order, please!

Before we proceed with further debate on Bill 41, the Chair would like to rule on the amendment proposed by the Member for Carbonear-Harbour Grace. The Chair finds the amendment to be in order and will be called when we deal with the Committee items at the Committee of the Whole stage of the bill.

The hon. the Member for Trinity North.

SOME HON. MEMBERS: Hear, hear!

MR. WISEMAN: Thank you, Mr. Speaker.

I was about to say it is a pleasure to get up tonight and speak a little bit about Bill 41, but this is an agonizing discussion. I haven't been around the House a long time but, in the last five years, we have a number of discussions in this House about significant issues affecting all Newfoundlanders and Labradorians, and this falls in that same category. I almost feel like we are having this debate under duress. It is like being blackmailed.

I have listened attentively today to Members of this House speak about the issues that are important to them, as they see it. with respect to this bill. They talked about the issues with respect to Fishery Products and the fishing industry in Newfoundland and Labrador. As I listen to the scenario that is being presented by Fishery Products International, it is a situation where, as I understand it, on one hand they are suggesting that if we do not do something with this in this House and pass the bill as presented, the company runs the risk of running into financial difficulty and we will have a situation on our hands where they may not be able to continue to operate, and on the other hand, they are asking us to do something to change a piece of legislation that was enacted in the first place to create Fishery Products International.

Fishery Products International has been explained by the minister this morning as a unique company. It grew out of a disaster in the fishing industry. It has a purpose which is to create a corporate structure and a piece of legislation to govern the operation of a fish processing and a marketing company, but, at the same time, it has a very strong social responsibility, because of the amount of money that has been invested by both the federal government and the provincial government, and, subsequently, the taxpayers of Newfoundland and Labrador. That is a unique position to be in, but it is a precarious position to put legislators in, to have to have this discussion. If you do not support the bill, there is a risk. If you support the bill, there is still a risk. That is a precarious position to be in, because we too, as legislators, have a responsibility to, yes, Fishery Products and its shareholders, but we have a bigger responsibility to the people of Newfoundland and Labrador, and particularly to the communities in which Fishery Products currently operate. I will speak to that in a moment.

I just want to get back, now, to the substance of the bill, because I have a couple of major concerns, Mr. Speaker. I am not certain where I sit on this bill. I am not comfortable supporting it, I am not comfortable at all. There are a couple of components to it. In the explanation at the beginning, there are two purposes of this bill: One, is to provide an opportunity for Fishery Products International to sell off some of its marketing related assets, but there is another piece of this bill that allows Fishery Products - in the current legislation there is a provision that protects government. Fishery Products, under the current legislation, cannot sue the provincial government, the ministers or the Crown, in any fashion, for any action government may take that has a negative impact on Fishery Products, as they see it. This bill proposes to eliminate that protection for government. Quite frankly, Mr. Speaker, I have a tremendous problem with that.

I recognize and acknowledge that it is a unique provision in a piece of legislation. I recognize and acknowledge that it may hinder Fishery Products in some fashion, as it relates to their share value. I understand that. It does not exist in any other corporation that operates in Newfoundland and Labrador, but at the same time, there is no other corporation that operates in Newfoundland and Labrador that was established in the same fashion as this company was. For that reason, Mr. Speaker, I have a tremendous problem with it.

The second piece of it is allowing them to sell off some of the assets. We have talked about it in this House, there have been many references to it, that Fishery Products are proposing to sell off 40 per cent of their marketing arm to move it into an Income Trust. That is what they are suggesting, but the bill does not limit it to 40 per cent. This bill opens it up forever. If we were to pass this bill tomorrow, then Fishery Products is given a blank cheque in some respects. They can sell off 20 per cent, 30 per cent or 40 per cent. They may not do anything. In fact, they may just sit back on this and do nothing for a little while. Then, when they decide to move, there is nothing in this bill that prohibits them from going to 55 per cent or 65 per cent. The only thing that they cannot do - there is a provision in here that says they must maintain a control of the company, so that it allows them to appoint the board. That allows them to get down to about 10 per cent. In theory, if we pass this, they could, in fact, sell off 90 per cent of that very profitable arm. I have a problem with that, Mr. Speaker. We are not being asked to look at this as a one time thing, to allow them to sell off a piece of it today and limit it to that, take the money and infuse it in the company as they are proposing. It is an open checkbook and I have a real problem with that.

At the same time, when we talked about what Fishery Products has offered here - and I commend the Premier and the Cabinet members who were participating with him in these discussions with Fishery Products International. We heard the Premier say this morning, that this has been an issue that has been ongoing since April of last year. Given what we have before us today as the conditions of what we are being asked, or what Fishery Products is saying, this is what we are prepared to do, we are not prepared to do any more, but this is it, if this is the ending point, I would not have wanted to have been at the table at the beginning point. This, in itself, has some major problems, as I see it. On the surface, it sounds like Fishery Products, for example, is going to invest $8 million on the Burin Peninsula, but that is if some level of government gives them 50 per cent of it, or $4 million as an interest free loan. That is not an $8 million investment. That is an $8 million investment contingent upon some level of government giving them $4 million tax-free.

Another provision says they are going to put $1 million, in the next two years, into research and development. Sounds like a lot of money, good idea, but it is subject to some level of government matching that same dollar amount - strings attached, not a clear picture. They promised the people of Harbour Breton $3 million, however it is only $1.5 million if this does not pass. Again, it gets back to this word - and it is a nasty word, and I am reluctant to use it, but I feel, as I said a moment ago, it is like we are being blackmailed in this discussion. When you are debating a bill and talking about a piece of legislation that has such a significant impact on a province and its people, and when you are having that debate against that kind of backdrop, I find that somewhat distasteful, to be frank, Mr. Speaker. I have some real difficulties with it.

I heard the Member for Grand Bank -Fortune talk today about her community of Fortune. I am extremely pleased for Fortune. If there is anything in this that I guess I take some comfort in - I listened to my colleague today from Bonavista South talk about how beneficial it was to now have a firm commitment from Fishery Products to build a new plant in Bonavista. The community of Bonavista, the District of Bonavista South, is adjacent to my district. Our communities and our economies are interrelated, so if it is beneficial for the community of Bonavista, it is beneficial for the communities in Trinity North, so our people work together, live together and our economies are related. That I take some comfort in, if there is anything for the people of Fortune.

Beyond those two things that I take some comfort in, because it benefits those communities and their respective regions, there is not much else in this that I can celebrate. The people of Harbour Breton; a major disservice. I think, if there is a glaring omission as I look at this, as I look at the back schedule, it is interesting that they have used the words community commitments. I look at my colleague representing that district, Harbour Breton, and I look at Marystown, Port au Choix, Port Union, Triton, Bonavista, Burin, Fortune, but no Harbour Breton, no commitment. The only community that is left off this list is Harbour Breton. All these other communities, together with Harbour Breton, have made a commitment to this company. It has made this company as strong as it is today, but they are not on this list. Commitments, but no commitment to the community of Harbour Breton, a glaring omission, again something that I have a great deal of difficulty with, and it is one of the reasons that I find it difficult to support this bill as presented. It is a glaring omission, I say, Mr. Speaker.

To the people of Harbour Breton today, the last few days, the last few months, it is a crime to put a community through that kind of anguish given the work that community has had and the commitment that the people of that community and the employees of Fishery Products in that community have made to that part of our region, to the economy of our Province, and to Fishery Products International as a company. I say, Mr. Speaker, again, another area that I have some real difficulties with.

I guess, Mr. Speaker, the other piece of this, it gets back to this whole issue of, it is not one of these things where you have a good deal and a bad deal. It is like you are being asked to pick the best of the evils. When we had the discussion the other day when Fishery Products International presented to our caucus, as they did to the Opposition caucus, Mr. Rowe, the CEO of Fishery Products, was talking about the industry. He said, during that discussion, that the industry is changing. There is major consolidation taking place in the industry, companies are consolidating, the larger companies are buying up. It begs the question: When this is all over, will it strengthen Fisheries Products? Will it strengthen it enough to allow it to become one of the buyers? Will it strengthen it enough to give it the cash and the equity to be able to go out and make some acquisitions and be a part of the movement of this industry, internationally, that is consolidating. Why it do that? I do not think so. What I think it will do - and I am not a financial analyst - it will strengthen it enough to allow it to be marketable and to be sold off. I think it does that and that is worrisome. These commitments that are here are commitments that are talking about maintaining these plants for a five-year period. The commitment in Bonavista, to start a plant late in 2007 and have it ready for 2008, that is well into the future. It is a commitment better than we had three days ago, but it is still well into the future.

It leaves a lot of unanswered questions about Fishery Products International's real intent. What is their long-term plan for Newfoundland and Labrador? What is their long-term plan as a corporate entity? This is not a new company. It is not a new company to the media spotlight. It is not a company that has not been in controversy in recent years. A few year back, in a major discussion about what Fishery Products was actually planning to do, the motivation of the new shareholders was brought into question, whether or not they were genuine in their commitment to Newfoundland and Labrador.

Again I say, Mr. Speaker, it is difficult to have this discussion and be asked to vote on a bill like this without asking those same questions all over again. Is it Fishery Products International's intent to strengthen itself and position itself such that it can become sold? It positions itself so now it is an easy company to buy, a profitable company to buy, because we eliminated the restriction. We have now allowed them to sell off their interest in the most profitable arm of the company.

I suppose in theory we could pass this bill now and they could have the permission to go out and sell off whatever they want. I said a moment ago, they are asking for 40 per cent, but this bill does not limit what they can do. They could, in fact, sell off 90 per cent, given the major cash infusion.

There are a bunch of questions to that, Mr. Speaker, that surface when you have a discussion like this, and it makes it very difficult to know exactly what to do. I think it would be much more comforting - I personally feel, in as much as I mentioned a moment ago in some of my comments, that there are other aspects of this that I have some real misgivings about. The issue of the amendments that allow them to now, in future actions, sue government, a benefit they did not have before, I have some real difficulties with eliminating that. I have some real difficulties with giving them a blank cheque. If they want 40 per cent now maybe we should craft this to the limit what they can sell to 40 per cent and come back to this Legislature if it wants to go beyond that. There are a number of questions to that, Mr. Speaker, that I have some real difficulty with.

One of the things that is glaring, very glaring - I go back to the appendix in this agreement - is when it leaves our Harbour Breton as a community that they are making a commitment to. I have listened to the news, particularly to the Open Line shows in recent months, and without exception, morning and night, you will hear someone from Harbour Breton on the radio talking about their particular circumstance in their particular community, an experience with themselves or someone in their family, or some friends of theirs, and the predicament that they are in, and my colleague in the House of Assembly talking about his constituents, and you cannot help but feel for a community that finds itself in that kind of position I say, Mr. Speaker.

Inasmuch as these other issues would not be addressed, would not be addressed at all, then I still have some difficulty with it. If I were to look at a list like this before I vote tomorrow and it included some consideration, and a greater consideration for the community of Harbour Breton, it would make this proposal much more palatable. As it is now framed, I say, Mr. Speaker, I have some really difficulty. Despite my comments about the benefits it is going to derive to the Community of Fortune, despite my comments about the benefits to be derived for the Community of Bonavista and surrounding areas, Mr. Speaker, it is an extremely difficult position to suggest - and I do not know Fishery Products finances but from what we were led to believe they are on the brink of bankruptcy. The question is, if you are in that kind of situation, is $100 million going to make a difference, if you have $30 million towards your capital debt and you have $70 million towards your short-term operating debt? This company has indicated that they do not have the flexibility to borrow any more money. In an operation this size if you do not have any operating flexibility and your operating credit has been cut and you have difficulty moving forward, I am not certain that $70 million is going to make a difference on that side on it.

I think it is important to have a better understanding of how that $70 million might be utilized. It is talking about reducing their short-term debt. It is talking about reinvestment, expanding. It is talking about putting some money into some initiatives outlined in this agreement. So, there are a number of things, as I say, Mr. Speaker, that need to be considered before I have a real comfort level with supporting this bill as presented here this evening.

We have heard some references to say about the role of the federal government. Unfortunately, we do not have the ability to be able to bring them into this debate here in this House today and tomorrow. But it is also equally as glaring, if you look at the lack of support by the federal government on this issue, and here we are before the House today and tomorrow voting on a significant bill that should have some provisions and commitments in here by the federal government. When I look at this it says: commitments to the communities by Fishery Products. There should be another appendix to this: commitments to the people of Newfoundland and Labrador by the federal government.

SOME HON. MEMBERS: Hear, hear!

MR. WISEMAN: Particularly, I say, Mr. Speaker, to the community of Harbour Breton.

Mr. Speaker, I said at the beginning - I was about to say it was a pleasure to be able to make some comments but it is not. I wish we did not have to debate this bill here. I wish this was not before us. I wish this was not an issue that we had to deal with. Unfortunately, as Legislators, we frequently have to deal with issues that are important to the people of Newfoundland and Labrador, challenging issues. Each one of us in this House tomorrow will stand and vote in a way that we think best reflects the interests of all Newfoundlanders and Labradorians and, specifically, the interests of those communities where Fishery Products currently operate.

I would find it a lot easier, and would not be as difficult for me to rise tomorrow and support this, if I could see some real significant commitment to the community of Harbour Breton. But, as I stand here tonight and listened to everybody who has spoken today, I am still anguishing over what I am going to do tomorrow. I am going to listen with some intent to the rest of the speakers this evening and listen tomorrow. Hopefully, we will all be able tomorrow to stand and vote feeling good about what we have done and walk out of here recognizing that we have just made a decision in this House of Assembly that is in the best long-term interest of the people of Newfoundland and Labrador and continues to have a vibrant Fishery Products International in the best interest, that is working in the best interests of Newfoundlanders and Labradorians which was the intent of establishing this company in the first place. It is the reason that the legislation exists that places some restriction on how they operate. If they want to operate outside of those restrictions they have to come back to the Legislature, like we are doing here tonight. That is what we want to continue to have, a strong Fishery Products that still has the control of this Legislature as they move forward, I say, Mr. Speaker.

Thank you for the opportunity to make my comments.

SOME HON. MEMBERS: Hear, hear!

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

SOME HON. MEMBERS: Hear, hear!

MR. REID: Thank you, Mr. Speaker.

I, too, want to rise tonight to speak to Bill 41, An Act To Amend The Fishery Products International Limited Act.

As I told my colleague, the Justice Minister outside the door just now, it is probably the most important amendment that we will see come before the House of Assembly. It is certainly the most important one that I have seen since I have been here in 1996, having been the Fisheries Minister, because what we are doing is we are changing the Act and allowing FPI to do the things - basically, we are taking the power out of the Legislature and passing it along to a group of individuals, most of whom are not even from our Province. Mr. Speaker, I am going to get into that later, but before I start I think we need to know a little about the history of FPI and what has happened over the past twenty or thirty years to bring us to where we are today and then I will explain what I think about the proposal that is on the table from FPI.

Back in the late 1970s and early 1980s there was turmoil in the fishing industry in this Province. A lot of processing companies were facing bankruptcy while others were facing severe financial problems. While I am not a big fan, and never have been, of the past Premier Brian Peckford, I would like to commend him here tonight for what he did when he established FPI. What had happened was a disaster waiting to happen in the fishing industry around the Province and the government, along with help from the federal government of the day, decided that they were going to establish one fishing company, a flagship for the industry in this Province. They called it Fishery Products International and it was first established with $300 million in loans from the Province and the federal government. What they were going to do was they were going to take these plants, set them up into a corporation and see if they could establish a flagship that would help not only make money for the company but also help other companies in marketing their fish. The most important consideration, I think, in setting it up was so that FPI would not just be a flagship for the industry but it would also look after the communities in which they operated and more importantly, the people in those communities.

At that time, when they established it, they set out an Act in this House of Assembly. There were a number of conditions in the Act that were to govern that company so we would not be in a situation whereby after it started to become profitable that company could sell off its assets and we would be left in the same situation as we were before the company was established. There were a couple of major conditions in that. One was that no individual or group of individuals could own any more than 15 per cent of the shares in FPI - very important. No individual could own any more than 15 per cent of the shares of FPI. The other one is the one that we are looking at here today, the amendment to the bill, and that is the Board of Directors of FPI could not sell all, or substantially all, of the assets of FPI. That is the importance of the amendment that we are looking at here tonight, and I will get into that one later.

The company was established in 1983, and it worked well. They had to close a couple of plants when they first got themselves established because they did not think they could be profitable if they kept all of them. Unfortunately, one of the plants that they did close, or sold off, was the one in my district, Twillingate. Another one was in the Minister of Fisheries district, up in St. Anthony. The companies that they did keep, they survived and they became profitable.

In the years between 1983 and 2001, because of the profits and the wisdom of the CEO of the company, Mr. Vic Young, they saw an opportunity to purchase a marketing division in the United States for their fish. You can have fish, but if you are going to market it you have to pay a marketing fee to someone. I guess they figured that the best thing they could do was to buy their own marketing division in the United States. They bought a company called Clouston's, and along with that they also bought some secondary processing plants. One, especially in Danvers, Massachusetts, and I have had the opportunity to visit that myself.

Mr. Speaker, the company went along well. In 1992, with the collapse of the groundfish fishery and the moratorium, FPI had to make again some difficult decisions. They did have to close some plants: Ramea, Gaultois, Trepassey, and those were difficult times, not only for FPI and not only for the people in those communities, but the whole Province in general. With the codfish gone and the groundfish in decline, FPI - because they owned the marketing division in the United States - were able to make some money to subsidize what was happening back here in the Province; in towns like Harbour Breton, towns like Burin, towns like Marystown, towns like Fortune. The only way they were successful in doing that is because they had the marketing division, because that portion of the company was making more money than any other portion of the company. Even today, we are being asked to sell 40 per cent of that division in the United States, which makes up 60 per cent of the income for FPI.

Mr. Speaker, it operated well. In the year 2000 it was operating so well, and doing so well, that a company called NEOS, led by a Mr. John Risley of Nova Scotia and a Mr. Bill Barry of the West Coast of the Province, decided that they wanted to purchase FPI outright because they thought it was a good investment. I can assure that many of the members who are sitting across the floor, especially the one from Bonavista South, knows what happened at that time. They wanted to come in and buy it. It was a pretty hot time, not only in the Legislature at the time - even though it was not openly debated in the Legislature, I was here - but out in the communities, about this group who wanted to come in and take over FPI. It was discussed in our caucus. At the time, it was decided that no, we were not going to let it happen. The only way it could happen is if we changed the legislation because, as I said earlier, no individual or group of individuals could own any more than 15 per cent of the shares. In order for Mr. Risley and Mr. Barry to buy that company we would have to come to the Legislature and change the legislation. I can tell you, 99 per cent of our caucus said no to that; no, because we were comfortable with the current Board of Directors and management of FPI, and I guess maybe we were a little afraid of change.

NEOS pulled their proposal off the table because they knew it could not fly and they went home. That was in 2000, but we all knew that they would surface somehow or another and in 2001 they did. They knew they could not get the legislation changed to pick up more than 15 per cent and get ownership, so what Mr. Risley did was he started, basically, what became known as a hostile takeover of the company and the board. He bought 15 per cent of the shares at FPI, a company by the name of Sanford Seafoods in New Zealand. Mr. Speaker, think about it, 15 per cent of FPI today is owned by a company in New Zealand.

Another group in Iceland, Icelandic Freezer Plants processors bought 15 per cent of it. You had three companies: Clearwater Fine Foods, Mr. Risley, Sanford Seafoods from New Zealand, and the Icelandic Freezer Plants had 45 per cent of FPI. There was another group established of processors in the Province, Newfoundland Freezing Plants it was called. They bought 15 per cent. So, they had 60 per cent between the four groups. Then they started the proxy fights. They were going to convince - they did not have to convince anybody else. They had 60 per cent control of the company. So at the annual board meeting they went in and said: We now control the company. We are voting out the old board of directors and we are establishing our own. At that time, there was a big debate in this Province as to whether or not the government should allow a group of investors, who owned FPI for the most part, if we would allow them to vote to replace the board of directors. We could not stop them from doing that because if we did, we would have to take over the company. There were members in the Opposition, in the Tory Party at that time, who said we should never allow it to happen. It was going to be the death of the company, that they were going to haul it down and split it up and sell it off.

But, Mr. Speaker, they did take over the company and they made commitments not only to the government of the day, but to the people in Newfoundland and Labrador. I can remember distinctly the day that me and my colleagues, many of them who are here tonight, sat in a boardroom in the West Block of this building when they made the commitments to us and they said: Here is what we are going to do. We are going to rebuild the fish plants because they need to be rebuilt, because the past board of directors of this company did not have the foresight to do it. They said: We are going to refurbish the boats and build more because the past board of directors let them fall into a state of disrepair. But, more importantly, what they said is that they were going to employ more people, not fewer people. They were going to employ more people, create more employment in the communities in which FPI operated. Now keep that in mind. We are going to employ more people. That was in the spring of 2001. In the spring of 2001, and in December of that year the word went out that the new Board of Directors of FPI were going to lay off 700 people in three communities on the South Coast in the Burin Peninsula; namely: Harbour Breton, Fortune and Marystown. We remember that well. I bet you there is no one who is listening tonight who will not forget that, what happened at the time when that came up.

What we decided to do - I knew what I was going to do, and my Premier, at the time Roger Grimes, said we are not letting it happen. As simple as that. We told them in the boardroom upstairs: Not going to happen. What are you going to do about it? We will show you. We came into the Legislature and on a suggestion from someone from the Opposition, they said: let's strike an all-party committee and visit the towns affected by FPI. We did. You can remember now, most of you, who had any connection to the fishery at the time, Mr. John Crosbie showing up in Marystown, leading the charge for FPI, going to solve all the problems, going to tell the people down there and on the South Coast why they should be allowed to lay them off. He actually thought that people were going to buy it. He actually thought, and I guess the board of directors, knowing who John Crosbie was, and his persuasive voice and his actions, could actually sell that to the people.

Well, I am surprised, sir, that they did not kill him the first night. He went the second night, to the next town we went to, but that was the last time we saw Mr. Crosbie on the road with the FPI hearings that year. We visited every community on the South Coast, and on the Northeast Coast, and on the Northwest Coast, where there is an FPI plant, and the message was the same: Don't let them do it.

We did not do it; we stopped them. We said, no, you are not laying off 700 people in this Province, and we amended the FPI Act, not to weaken it but to strengthen it, to prevent this from happening again, because they made commitments to us. When someone makes a commitment to me, I expect them to honour it. I do not expect to be seated around the table and lied to by a group of business people and professionals. I took them at their word when they wanted to take over the board of directors, and there was little we could do to stop them from doing that, but we told them that day, we will be watching everything you do.

So, they made all the promises and they tried to break them. Now, where are we today with this same group? Back last fall, the announcement comes right out of the air: We are closing Harbour Breton, laying off 350 people, and we are downsizing Fortune - right out of the blue. What happens? After there was a bit of a racket here in the House of Assembly, there were lots of questions asked by the Opposition, people in the general population got a bit upset about this, and all of a sudden they were going to try and remedy the situation in Fortune by doing some job sharing in Burin and Marystown. That was their only solution to it.

When asked at the time, what about the future of Bonavista, do you remember the answer? I asked them, what about the future of Bonavista? The answer that we received from the CEO of the company was, we have given no guarantee beyond this year. No guarantee beyond this year. What are you going to do for Fortune? Not much.

That was January of this year. That is what was going to happen. Now, all of a sudden, because they want to sell 60 per cent, or 40 per cent, of their American assets, the assets that keep FPI alive, all of a sudden guess what happened? All of a sudden we have become very magnanimous. We care about these communities. We are going to give commitments again. That is what they are going to do. What commitments have they given?

On Monday, when I met with FPI, the commitment to Bonavista was: In two years we will decide if we are going to build a new plant or move the existing plant up to Catalina. I have been in the plant in Catalina. I have been in the plant in Bonavista. I know the condition of both. I said to Mr. Rowe: Is there room in the building in Catalina to put the crab plant in Bonavista? Do you know what the answer was? Yes, there is room, and, yes, the building is in great shape, but we will not make that decision for two years, whether we are going to rebuild the plant or move it to Catalina.

What about Fortune? What are you going to do in Fortune? This was the conversation on Monday afternoon at 2:00 o'clock. What about Fortune? When are you going to start building the plant in Fortune? The answer: Don't know if we are building it in Fortune yet. I said: I thought that was the proposal? No, we have two options there. We can build the plant in Fortune, or redo the plant in Fortune, or we can build an extension on to the plant in Burin. I said: When are you going to make the decision? He said: We are not. We are not going to make the decision. The union is going to make the decision. Very good.

So those were the proposals that were put on the table on Monday, proposals that we were told were binding. We even went so far as to say that if we tried to amend them we would take them off the table.

I went to Central Newfoundland on Tuesday, turned on the radio, and all of a sudden there is a brand new plant for Bonavista, refurbishing the plant in Fortune, going to employ 201 people. We are going to keep all of the plants open in the Province, all of our other plants in the Province, but there are a couple of kickers. They are very important, ladies and gentlemen, very important, and you should read them very carefully. We are going to build a new plant in Bonavista, three years from now. We are going to refurbish the plant in Fortune. We are going to leave all the plants open in the Province, depending upon two conditions: Number one, economic viability; and, number two, resource availability.

Let's look at the second one first: We are going to leave all the plants open, depending upon resource availability. I am talking about their commitments, and how they can get out of them much easier than they could when we were there.

Resource availability: this year Bonavista depends 90 per cent on crab, would not exist without crab. This year, scientists recommended to DFO that the crab quota in 3K, which is the area Bonavista North, be reduced by 35 per cent. That is what the scientists recommended to the Minister of Fisheries in Ottawa.

The federal government said we cannot do that, it will cause too much devastation, so they dropped it to 20 per cent. I talked to a scientist tonight and he said that probably the effect of that will be that we will have to reduce it even further next year. So, you are talking that we will get a plant in Bonavista depending, three years from now, on resource availability. Well, boy, I will tell you, I am not a betting man but I would not bet a lot on it, and I do not mean to be discouraging to the people of Bonavista.

Economic viability is the next one: groundfish. The Minister of Fisheries is on record time and time and time this year saying there is no money in groundfish. We cannot compete with the Chinese. Foreign fish is too expensive to buy, and the Canadian dollar is blowing it all out of the water.

Economic viability, there is another thing about economic viability, I say to the Minister of Justice. You and I may have the exact same company and, because of your management skills, your company might be profitable. Because of my management skills, my company might be bankrupt in a year. How do you prove economic viability? I think economic viability depends a lot on the board of directors, and whether or not the board of directors want to make something work. So those two, right off the bat, in my mind, give no comfort to the people of this Province, none whatsoever.

Then, the next thing that we are saying is, the government is going to put in these conditions. We call it the hammer on our side. If you do not do something, you are getting the hammer. The only hammer the government has in this piece of legislation is that if you do not do what you said you are going to do, you are going to forfeit your groundfish licences. Think about that, now. Think about it. The people who work in the groundfish plants that belong to FPI should think carefully about that one, because what happens in two years from now, if FPI say we cannot build or we are not building the crab plant in Bonavista? What do you do? What is the only recourse the government has? Take the quotas from FPI, the groundfish quotas. Now, can you imagine doing that? Can you imagine walking up to the board of directors on O'Leary Avenue and saying: You did not honour your commitment in Bonavista; we are taking your groundfish licences.

Do you know what they would say to you, Mr. Premier? Here, take them. You go down to Fortune, you go down to Marystown, you go down to Burin, and you tell them they are laid off. We are not doing it.

That is what could happen, and that is the only hammer that we have in this piece of legislation. That is it, so these are issues that I think are very important and the ones I am scared of. Number one, that all of these promises are contingent upon resource availability and economic viability; and, number two, we do not have a hammer if they break them.

Why didn't you put the shrimp quotas on the table? Why didn't you say to FPI, you have shrimp quotas that are worth at least $3 million. They have roughly 6,000 tons of shrimp. If it never sees land, you can sell it for $3 million. They have a couple of brand new draggers out there that are worth a lot of money. Instead of saying we are going to take your groundfish quotas, why don't you say we are taking your shrimp quotas? - because they can be sold like that [snapping of fingers] for $3 million a year. We are taking your draggers. Then you might have a hammer.

These are the problems that I have with the piece of legislation that is before you. There are other things that I have problems with, very serious problems, and that is with the ownership that we are discussing here tonight, very serious problems. As I said when I started, the American division is the cash cow for FPI; and, believe me, we would not exist, FPI would not exist in the Province today, had they not had the foresight to buy the marketing and value-added division in the United States.

I have been down there in the marketing division. I have been at the Boston Seafood Show where FPI has the biggest booth. Everyone has been to the Home Show, or one of these shows at the stadium somewhere in the Province where people have booths set up. Well, the Boston Seafood Show is the largest of its kind in the world. You would put about five Mile One Stadiums in it. It is three floors, and all through those three floors there are booths set up. Do you know the largest one down there? FPI. You walk in, you go over to the table, and you see the $3,000 suits lined up behind it. These are the hotshot salesmen and the marketers that FPI have.

I used to laugh, because I went there a couple of times and, not only did they not know Gerry Reid, the Minister of Fisheries for Newfoundland and Labrador; they did not know where Newfoundland and Labrador was - but they were good at their work. They bought and sold fish around the world. In fact, Vic Young will tell you that they were buying fish, I think it was tilapia, in Victoria Lake in Africa, and selling it somewhere else in the world. Just imagine, the company that was established in this Legislature buying fish in Victoria Lake in Africa and selling it somewhere else in the world.

They were hotshots. They had a great secondary processing facility there. First when I went there it sort of bothered me to see all these bigwigs working for FPI with their $3,000 suits and I would think about the people in the plants back home who made it possible; but then I said, I have to get over that because these fellows are good at their work and maybe some of the money they are making for FPI can subsidize at least the families back home here in Newfoundland and Labrador.

If we pass this piece of legislation tonight, tomorrow or next week we will no longer, possibly - it is possible that we will no longer own that division. Think about that, because they are asking to sell 40 per cent of it tomorrow if we pass this legislation; but, if we pass this legislation we will be giving FPI the authority to sell it all if they so desire, because even in the legislation, in every piece of material that the Minister of Justice put out, he has said initially that they are allowed to sell 40 per cent, which means they can sell it all.

If you are going to sell 100 per cent of that company, who are the profits from that portion of the company going to go to? They are not coming back here to help plants when they are in trouble. That frightens me, but what even more than that frightens me is the fact that - remember the share restriction I talked about earlier. No individual or group of individuals can own any more than 15 per cent of FPI. No individual or group can own more than 15 per cent each. Right now, Mr. Risley owns 15 per cent, Mr. Sanford owns 15 per cent, the Icelanders own 15 per cent. What is to stop the three of those individuals from buying 100 per cent of the marketing and value-added division in the United States, which makes up 60 per cent of the company? Just think, if they do that next week, if these three individuals buy 100 per cent of that portion of the company; 100 per cent. That portion of the company makes up more than 60 per cent of the income for the company. Think about that now. They are going to own 100 per cent of 60 per cent of the company. They already own 15 per cent each or 45 per cent total of the entire company. If you do the math - and someone over there must be. I am sure the Member for Topsail is, she used to be the Auditor General. If you own 100 per cent of 60 per cent to 65 per cent of a company and you own 45 per cent of the remaining 40 per cent, you own somewhere between 78 per cent and 83 per cent of FPI. If we pass this piece of legislation tonight or tomorrow night, that is what we are doing. We are potentially passing over 83 per cent to FPI to three people, or two people, or one person. We have an Act here pertaining to FPI, and we will go around and still say that we control FPI in the Legislature. I say, if you want to go that route, and I certainly do not, the best thing that you could do with the FPI Act here tonight is take it and do that with it [sound of paper tearing], because that is what it will mean. That is what control we will have over the company.

Now, you might argue that because it is an Income Trust and you can buy that 60 per cent, or that 100 per cent of the 60 per cent, that you do not have control of the company because you are not on the Board of Directors. That is fine and dandy. In my way of thinking, and I think most people's way of thinking, if you own 100 per cent of an Income Trust, or if you own 100 per cent of the American division of FPI, whether you control the Board of Directors or not, you still own 100 per cent of it. That is my biggest fear with all of this, that we are selling out FPI, or if we are not selling it out, we are certainly passing control to someone other than the people in Newfoundland and Labrador, and more importantly the Legislature and this House. I do not think there will be anything we can do to control them once that is done. That is another reason I have grave concerns about what we are doing here tonight.

The last one is: What do we do with Harbour Breton? What do we do with them? I have watched it, and I am not blaming anybody. We try to blame each other in this Legislature. Politicians try to blame politicians for what is happening out there. Someone does not get a licence, or someone does get a licence, or if a plant closes, it is your fault, and if another one closes, it is my fault. We do that all of the time. I have seen plants go down in this Province. The one we have not heard a lot about in recent times, that are still fighting for their lives and not having a lot of success with it, is Burgeo. They have done everything, I say to the Premier. They have looked at every single option that you are looking at today for Harbour Breton. We talked about quotas from Ottawa. We almost had one with crab once, went pretty close. No, no cigar. We almost had it. They have looked at everything, but the only thing that could make Burgeo work is fish and they have none.

Ramea; the same thing. You are talking about passing plants over to towns for $1. If you want to see what happens when you pass a plant over for $1, go to Ramea. These plants have been around this Province for fifty or sixty years and, believe me, no one was thinking about the environment forty years ago around a fish plant; no one. The plant was passed over to Ramea for $1 and we just missed an environmental nightmare when half the plant fell into the harbour down there a few years ago. Where are they today? They had to fight tooth and nail for eight months to get a licence to do what? Whelk! Well, I tell you, it is not going to employ a lot of people and they will be lucky to get it going.

We are talking redfish today for Harbour Breton to survive on. Go down to Gaultois. What have they got? Gaultois had a redfish quota since God knows when. I know it was there prior to the moratorium and it has been there ever since. They did not fish it last year. Do you know why? It is not economically viable. Not economically viable - keep that in mind. Redfish, it just cannot cut it. It is not worth it, ladies and gentleman, believe me. One is that, if there is any value in it, there is very little processing, and right now there is no value. Two, FPI, the company itself, left redfish in the water last year. They did not even catch their own quota. So, I would not be in any hurry to rush off and buy any quotas of redfish. Ask the people of Gaultois about redfish.

If you look at Burgeo, Ramea and Gaultois, look at Trepassey. They had their income adjustment fund, or whatever they call it up there, in 1992 and 1993 because the plant was closed and they were given $5 million or $6 million to go out and create new industry in their town. Where is it? So was Gaultois. So was Ramea. You cannot take fish out of those towns and expect them to survive. You cannot do it. We can talk all we want about economic diversification in a town like Harbour Breton, but if you do not have fish, boy, you are in for a hard slog. What do we all do with Harbour Breton?

What we do, I suppose, as a race of people in this Province, we give more to charities than anyone else in the country. When they had the tsunami over there in the Far East this year, there were people beating my doors down for a donation to send over there. We do it, but when a disaster happens in the industry, what do we do? When someone comes along with a couple of carrots - or as the Minister said today: Two out of three is not bad. The Minister of Justice said on the radio yesterday: We got two out of three, we got Bonavista and we got Fortune. We did not get Harbour Breton, but two out of three is not bad. That is what we do in this Province.

We saw Burgeo close, and while we sympathized with them, it is like you did not really want to look back because your guilt would take over. That is what happens, and we do not stand together in a case like that. We do not stand together and say: If you do it to them, we are not supporting you. If you do it to them, you do it to us all. That is what is happening today. FPI has played this one very, very smartly, because on Monday there was no plant for Bonavista and there was no plant for Fortune. They knew this vote was coming here Thursday or Friday of this week, so, all of a sudden, there is no trouble to put a plant on the table then. They would not do it for all three because they knew that the existing groundfish plants, when told that they are going to be open for five years: We will support it. We knew the people in Bonavista would support it, because we are promising them a new crab plant, and we knew the people in Fortune would support it because we are offering them opportunities. I do not blame the people in those communities for supporting this, but sometimes you have to look at yourself and say: What about our cousins, because next week, next year, or a couple of years down the road, we are going to be those cousins.

Ladies and gentlemen, I tell you right now, I will not support this bill without something for Harbour Breton, and I am so sure that I can support this bill even if there is something for Harbour Breton. If you look at what we are doing, by changing this legislation, there might be nothing left of this company in a couple of years from now, when some small group of individuals can end up owning 83 per cent of it in one way or another. Someone might get up and argue with me later on that they do not have control of it, because this is only an Income Trust, but if you own 100 per cent of it, whether you have control of it today or not, you are going to influence control of that business.

What we are taking out of this legislation is also a part that the Leader of the NDP Party, when I was Minister of Fisheries, the present Minister of Fisheries, and the Member for Bonavista South put into it, the prohibitive clause. We put that in there because we were thinking at the time that if FPI was going to do something that we did not like, we would use any measure at our disposal to stop them from doing it. We put that in there. What it means, the prohibitive clause, is that it prevents the company from suing you regardless of what you do to them. We are removing that tonight. It is another part that we are removing, which is very important. The Member for Trinity North mentioned it early tonight. I must say you were very perceptive in what you said here tonight, because what you said, I feel the same way. If we are going to try and stop FPI - when questioned by the current Minister of Fisheries when he was over here as my critic and I was over there as the minister, he would always say: What are you going to do. I said: Do not worry about it, they will not do it, because we will use the Legislature to prevent them from doing it. There was the hammer, and we are eliminating the hammer by voting for this piece of legislation.

All of us have gotten the e-mails from Harbour Breton. All of us have gotten them in the last few days from school children. It is supposed to be the happiest time of the year. It was for me when I was a teacher, I tell you, the last week of school and you are looking forward to the summer. One student said today: It is supposed to be the happiest time of year and I do not know if I am going to be back here next year. Not a pleasant thought for a kid to be thinking.

What I am trying to say to you is, before you - even those of you who are getting something out of this piece of legislation - run off and vote yes, think about the ramifications, not only of the people of Harbour Breton, but what it is going to do to the company. If we are going to be back here in a year or two from now, shaking our heads and saying, we no longer have an FPI, then there is absolutely nothing we can do with it because we have already given it away by changing the legislation.

I remember - and I am sure the Member for Bonavista South and I know the member who represents Harbour Breton was there - going to Harbour Breton on a frosty night back in 2002 when we held the hearings, and it was the most emotional night of my life. The hall was full, 700 to 800 people seated. When we called the meeting to order, the doors burst open and I said to myself first: Uh-oh, there is trouble. In through the door walked 200 people in their uniforms. They took an hour off from the plant to come up tell us to save their town. I remember one woman in particular, and you might find it a little humorous what she said. People laughed, but there was a lot of truth in it. At that time, they were talking about the loopholes in the legislation that were allowing the Board of Directors of FPI from laying these people off and telling them to go home. One woman got up to the microphone and she said: Mr. Reid, you look after the loopholes and we will look after the assholes. We looked after the loopholes and the other people were taken care of at that time.

I can tell you that the people of Harbour Breton - I talked to a plant worker in the mall just recently, thirty-eight years in the fish plant. Think about that, thirty-eight years and told to go home. Most people who work thirty-eight years get a pension and are retired. The man was fifty-five years old with thirty-eight years in the plant. He was seventeen when he went in there, right out of school. Not only did he not get a pension, guess what happened to him? He lost all of his medical benefits and his wife is ill. He lost his job, he lost any hope of a retirement, and with no money, he had to take on the added expense of medication that his insurance previously paid for. Every one of these people who built FPI, who put on their rubbers and went down in the plant and stood in one position for eight hours a day - it is not easy. Think about it, standing, like I am now, for eight hours a day, cutting fish, but with water flowing through, and the humidity in the building, and not such great conditions. Do that for thirty-eight years and have some - I cannot use the words in the House of Assembly - tell you to go home, we no longer need you. We no longer need you. Go home.

Who are these decisions being made by? Who are they being made by? Because we always look - think about it - we always look at Derrick Rowe right now. He is the bogeyman. Derrick Rowe is only an employee of FPI. Do you know who is calling the shots in this? A Mr. Sanford in New Zealand today owns 15 per cent of the company. He is probably still in New Zealand today.

You have a group in Iceland, our direct competitors in the marketplace, sitting in Iceland making a decision on the people of Harbour Breton. We have Mr. Risley in Nova Scotia, who owns Clearwater, whose favourite sport is yacht racing, who is making the decision today, whether it is from his yacht in the Carribean or his office in Nova Scotia.

These three I just mentioned make up 45 per cent of the company. That is who is making the decision on the lives of the people in the Province. I tell you, if we pass this legislation today they will own more than 45 per cent of the company. They will own up to 83 per cent of it. What are they going to do with it? There are a number of theories and philosophies around. There certainly were when they took over the board of directors. Some of the people sitting over there were sitting here then and used to talk about the theories, about what was going to happen, and how they were going to divvy up the company. One group was going to take the marketing division, another group was going to take the draggers, and Newfoundland and Labrador was going to end with absolutely nothing, because it was a ripe company for the picking.

If you look at it, the sales of FPI last year were over $800 million. The assets in the Province are less than $100 million. So, the assets are undervalued and the boys moved in and grabbed it up. Now they want to pick it apart, take it and sell it off, grab what they want as being profitable, and tell the rest of us to go home. Well I, for one, will not be voting for that, Mr. Speaker, I will tell you that right now, unless something changes here and changes dramatically. I certainly will not even be considering it if Harbour Breton is not included, and something for Harbour Breton that is worthwhile.

I am not voting for a redfish quota for Harbour Breton so that they can go home and then six months from now realize that what they got is no better than what they have today. I am not doing that, and I am not even sure if I can bring myself to vote for this if Harbour Breton gets something, because we have a number of other issues in this legislation that, for me, need to be addressed, a number of clauses here that need to be changed before I can address it.

Mr. Speaker, I thank you for the opportunity to speak. I understand that, as leader of the party, I get to speak for an hour, and I can also get an hour to speak as the critic, so I might be back again tomorrow before this debate ends.

Thank you very much.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The hon. the Minister of Innovation, Trade and Rural Development.

SOME HON. MEMBERS: Hear, hear!

MS DUNDERDALE: Thank you, Mr. Speaker.

I am happy to participate in this very important debate here tonight, perhaps the most important discussion that we have had in this Legislature since I was elected eighteen months ago.

All of us in Newfoundland and Labrador have an association with the fishery. All of us, regardless whether we live in towns that have manufacturing or are involved in paper production or involved in other industries, oil and gas, all of us, Mr. Speaker, are dependent in some form or another on the fishery in this Province.

My family has a long, long association with the fishery, Mr. Speaker. I grew up in Burin, on the Burin Peninsula. I lived there for most of my life. My husband and I raised our children there. My father, when he was twelve years old, was taken out of school and put in a dory with his father on the Grand Banks. He was his dory mate, twelve years old. Thus, his career in the fishery began. Throughout his life, my father tried a number of times to come away from the fishery because it was a very, and remains a very, difficult way to earn a living.

We have often heard the Member for Bellevue talk about his father's work, and the troubles that he encountered in the lumber industry, working in the forest camps. My father, at one time, tried to do that also, and tried to get away from the fishery and find a better way to earn a living. He tried the lumber camps and, as a result of his experience there, he ended up with a permanent handicap for the rest of his life. He lost most of his hearing as a result of malnourishment and hard work and the terrible conditions. So, back to the sea he went again and he continued to try and earn his living there.

When Fishery Products established its first deep-sea plant in Newfoundland in 1942, in Burin, my father was an employee of Fishery Products. In those days, Mr. Speaker, as all of us of my generation know, there was such a thing called a co-adventurer system. You worked. You went to sea for any number of days. You fished - because in those days were the draggers and you had to put the nets out and you had to haul them back - and you worked like a dog regardless of whether or not there were fish in those nets. If you brought fish home to your plant, you were paid. If there was no fish, you did not get paid. There were lots of times, after days and days and days of toil on the Grand Banks of Newfoundland, fishers from all over this Province who worked with companies like FPI came home and had no income.

I remember, as a very young child, my father coming home after twenty-seven days at sea. They came into Burin in the morning and they immediately began to ice the boat to go back to sea again that afternoon. They stopped for a half-hour for lunch, and my father took that opportunity to run home to see us, to see my mother and to see the eleven children who lived in our house. I remember him leaning up against our kitchen door and telling my mother that, not only was there not any income - there wasn't any paycheque because there wasn't any fish - but, in fact, he owed Fishery Products money for the food that he had eaten in the twenty-seven days at sea. I remember, as a little girl, standing on the hill at the back of our house watching my father sail out to sea to try again. That speaks to the character of the people of this Province.

Later on, social programs got introduced. Unemployment Insurance programs made things a little easier. Then came the fisheries' union and things became easier still, and people got paid for their work. Fishery Products prospered. Other deep-sea plants were established based on the work that had come out of Burin all over this Province.

Times were good sometimes; times were more difficult at others. In 1983, times were really bad. A number of companies in this Province were in trouble, and the fishing industry had to be restructured. In 1983 we were told, in Burin, that our primary processing plant was closing, that our 650 employees were going to be dispersed. There was going to be a consolidation in Marystown. Some of our people were going to be employed there, others were going to be out of work completely, and our one-industry town heard a death knell. Our plant was gone. It was over for the Town of Burin.

It is one of those moments in my life that I can tell you where I was, I can tell you the time of day, I can tell you what I was wearing, when I heard the announcement that Burin plant was closing.

As I have worked with the IAS Committee from Harbour Breton over these last months, a number of times people have said to me, you don't know what it feels like. Let me tell you, I know. I know what it feels like. They have said, we cannot describe to you what it feels like. I know you cannot, because twenty years later I cannot describe it, but it is the most terrible feeling in the world - but, as a town, we drew together. We knew that we had what we call today sweat equity in Fishery Products: the people who had worked in the plant, as the Leader of the Opposition said, in rubber boots, in icy cold water.

It was interesting. Very few people, when I grew up, ever lived to enjoy their retirement when they came out of the plant. They physically did not live long enough, they were so worn out by the work they had done. They had used their blood, their sweat, their tears, in the building of Fishery Products. They felt that they had equity in that company, and so began our battle in Burin to save our primary processing plant.

We lobbied the company, and a lot of the players are still around today, very involved, very vocal about the fishery. Richard Cashin was head of the union. Gus Etchegary was the CEO for Fishery Products International. These were the people we were dealing with. The union was on side; they stood with us. Our trawlermen refused to sail. Our fish plant workers refused to cross protest lines that we set up in front of the plant. We impounded, basically, the plant, nine trawlers, and 700,000 pounds of processed fish. We went to our sister communities, the other communities that had FPI facilities in them, and said: Will you stand with us? Can we stand together as five deep-sea communities and consolidate our place in the fishery so this does not happen to any one of us ever again? We went to every community that would listen to us. We went to every organization that would listen to us. We manipulated the media in every way we could so that we were in the forefront in people's minds and our issue was on the table.

There were lots of highs and lows in that year. At one time Fishery Products decided that they had had enough and they sent an eighteen-wheeler truck into the plant, through the protest line, to take out their 700,000 pounds of fish, which was the only thing they really wanted at the plant. The town council, thanks be to God, found a leak in the road, right across the fish plant gate and had to dig up the road -

SOME HON. MEMBERS: Hear, hear!

MS DUNDERDALE: - and the truck could not get out. We continued our negotiations and eventually they got an injunction. The police came and the company sent a bulldozer to fill in the ditch. People in the community jumped down in the ditch to try and prevent the ditch from being filled in. One of the people who jumped in that ditch, Mr. Lundrigan, was the father of the present day Mayor of Burin. He died soon after and a lot of people in the town attributed his death to the stress that was brought on by all of that. To say: Do you understand what we are feeling and what we are going through? Yes, we do. Yes, we have had that understanding here.

We worked for a year and finally we got an agreement to have Fishery Products International secondary processing done in Burin. There was a commitment made twenty years ago that all of Fishery Products International's processing sector would always be done in Burin. Now, some people in Burin saw that as a great, great success but others were deeply disappointed and hurt. We had lost our primary processing plant and while we still had employment in the town and an industry in the town, hundreds of people had been displaced because we did not have the same workforce. So, these things leave a lasting, lasting impression on you.

When we had the cod moratorium in 1992, I was asked to sit as a member. Later I chaired the Independent Review Committee for fishers. It was the second-last level of appeal for fishers all over this Province, Newfoundland and Labrador, who were turned down for the NCARP remuneration package. In that job I travelled all over this Province and saw firsthand - talked with people, talked with communities, heard the cases, thousands of them - the devastation that was brought on this Province by the cod moratorium. Those things mark you.

I am passionate about Newfoundland and Labrador. It is where I have spent the greater part of my life. I see the opportunities that exist all over this Province, in rural parts of the Province, but I also know that part of the economic future of Newfoundland and Labrador for so many of our rural communities lies in the fishery. It is a sustainability piece for so many communities all over Newfoundland and Labrador. So I brought that knowledge, I brought the experience of my childhood, I brought what happened in Burin in 1983, I brought what I saw and heard in the cod moratorium in 1992 with me when I came to this House of Assembly. I care deeply about what happens in rural parts of this Province. When the Premier invited me to take this portfolio - I remember clearly when he gave me the invitation that day because it was such a great honour. One of things the Premier said to me: One of the reasons I am giving you this portfolio is because of your passion for rural Newfoundland and Labrador.

So, all of that was very much a part of my thinking and how I was feeling when Fishery Products came to us fourteen months ago with a proposal for an Income Trust, because there are eight communities in this Province that continue to have a very strong association with FPI. Their future and their long-time economic sustainability and viability is linked inextricably with FPI. So, it was extremely important that we do the right thing. What was the right thing? We immediately, all of us, found ourselves on the horns of a dilemma. We knew that Fishery Products - I mean, they are all public documents - was carrying extreme debt, $110 million worth of debt. We knew that they were having trouble accessing capital. Everyone in the Province is aware of the problems associated with, now, access to resource. Everybody who watches the news or pays any attention to what is going on anywhere in the world in business understands that the rise in the Canadian dollar has had a devastating affect on companies, not only the fishery, but all other companies that are exporting around the world. So these were very, very serious problems.

We could say no to FPI, but if we said no, the one thing that we knew for sure was that FPI would probably not last; in the long-term, would not last very long at all. If we said yes, where was the accountability going to be for FPI? How could we ensure that our rural communities, which are so important to this Province, how were they going to survive? Where was the promise for them? How did we ensure that people just did not take the money and run and strip out the company and we would be left with nothing? So, if we did nothing these communities could be lost. If we did something, and did not do it properly, these communities could be lost. Extremely, extremely difficult. All of us, I expect, spent more than one restless night trying to wrestle with how we were going to come to terms with this. We had to balance the rights of the shareholders, the rights of the people of the Province and the sustainability of our rural communities.

I remember clearly the day that the Premier said we have to negotiate with Fishery Products. We have to ensure that we ring out of them as much as we can possibly get to guarantee that the people of this Province are protected, and then we will go to a free vote in the House of Assembly. We will get the very best that we can get and then we will put it before the House of Assembly, putting it before the people of the Province.

So, here we are and this is what we have been able to achieve in fourteen months of negotiation. Is it perfect? Not by a longshot, but it is a darn sight better than what we started off with. I have been in contact - I have been dealing with Harbour Breton as Chair of the Ministerial Committee and the member for months. I have been dealing also, as Chair of the Committee, with the ministerial committee with the Premier, with the Town of Fortune. I have been talking this week with Triton, Trinity Bay North, Port au Choix, Bonavista, Marystown and Burin. There have been wonderful pieces that came out of all of the experiences that I referred to when I began. There has been wonderful changes that has impressed me so much this week.

All of these communities are concerned about their own long-term sustainability and viability. The people who we have been talking to, like the municipal politicians, that has been their charge, the same as the MHAs that we find here in the House of Assembly. They have been very concerned about their own towns and ensuring that there is a long-term economic future for the plants in their towns.

When we were able to get FPI to agree to an $8 million investment on the Burin Peninsula -because remember when FPI first started talking about the Income Trust, they talked about a $3 million investment in Burin, an expansion in Burin. Expectations were raised in Burin, and when the Burin Town Council met with us and talked with us, and then they met with FPI and talked with them, and then they talked with their union leadership, they were assured of the long-term sustainability of Burin and the room for incremental growth in Burin. Their immediate concern, then, became Fortune. They did not start talking about the promise twenty years ago to do all the secondary processing in Burin. They knew that Burin's long-term survival would sustain as long as Fishery Products International is operating in this Province.

Their concern then became for their sister town in Fortune, because they know, as the Burin Peninsula goes, so does Burin go. They knew they wanted to do everything they could to support Fortune, for the people of Fortune, for their sweat equity in the growth of Fishery Products International, the equity that they have built over all these years with the labour that they have done and the support that they had given Fortune. They knew to lose people from Fortune, to lost the community of Fortune, have people going all over the county looking for work, impacted them in a very negative way. It was not only pain for Fortune, it would be pain for the whole Burin Peninsula, because it affected health and education and all of these things.

I saw something happening on the Burin Peninsula that was not there twenty years ago. When we went to our sister communities twenty years ago, they told us to go home and look after ourselves and they would look after themselves. I did not hear that from any community that I talked to over the course of this piece of work. Yes, they were concerned about their own communities, but they were concerned about every other community also. Every one of those communities that I talked to this week talked about Harbour Breton.

MR. SPEAKER: Order, please!

The member's allotted time is expired.

SOME HON. MEMBERS: By leave.

MR. SPEAKER: Leave has been requested and leave has been granted. Leave has been granted to make some concluding comments.

MS DUNDERDALE: Thank you, Mr. Speaker.

We all see what is laid out before us here today, and we have done very well, I think, in terms of comparing where we started to where we have gotten to today. Is this perfect? Not by a long shot. That is why we are here, so that all of our collective knowledge can make a judgement on this. The protection is there if they renege.

I have to ask the question: What is the alternative? That is the question. One point I want to make, we are all going to be listening until we come to vote tomorrow to see what FPI is going to say with regard to Harbour Breton, but I want to close with this: The Premier has said it time and time again, he said it on the air waves, he said it in meetings, he said it here in this House of Assembly - and every one of us support him, to a person, on this side - regardless of what happens with FPI, whether we approve this Income proposal or whether we do not, we will not let Harbour Breton go.

Thank you.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The hon. the Member for Cartwright-L'Anse au Clair.

MS JONES: Thank you, Mr. Speaker.

I want to rise and speak to Bill 41. I have to say, over the course of the day I have listened very intently to all the members in this House who have spoken. It is interesting to hear the perspective that each person brings to this debate. I do not think it would have gone unnoticed to any listeners in the Province, that everyone in this House of Assembly no doubt feels that this is a decision that will be of tremendous responsibility, that all of us will carry for quite some time, in terms of how we vote this evening.

I listened to the minister who just spoke talk about her roots in the fishery and her family's roots in the fishery. I guess I am of the same stock, because I grew up in a fishing community, I grew up and represent a district today that is founded on the fishery, and all of my family participated and still participate in fisheries of all scales. I know what it is like to work in a fish plant, because I grew up in a community where, when I was just a teenager, you went to work in the fish plant because that was the job to do in the summer time. I did it for three summers, and I can guarantee you that the people who worked in those plants then and the people who work there today, for them it is not a job, it is not a burden of responsibility, it a pleasure to get up in the mornings and take their place on the assembly line or to take their job in that plant, because it has become a part of who they are, it has become a part of what their communities are all about.

Mr. Speaker, we are debating legislation here today with regard to FPI and what will be the future of FPI plants in Newfoundland and Labrador, and more so the future of FPI as a company. I think that, yes, there have been over the last fourteen months, I am sure, great deliberations by the government and the company in terms of the direction that they would seek in preparing a bill to come to the Legislature today. I am sure that what we see today is not what they started with fourteen months ago, or I certainly hope not.

What I will say to you is this: It is always good when you can get concessions. I know, in every negotiation, and I have participated in a lot of them myself, you always feel good when you can get a concession and you know that you are making a move forward. At the end of the day, you have to look at the big picture and the whole picture, and what is the value of what we are doing today, what is the value of it to every single person in this Province. Is it good enough to say to one or two communities in rural Newfoundland and Labrador, we think you might have a fighting change because a corporate company wants something bad enough that they are going to give something back to you and to you, but they do not want it bad enough that they are going to give it to you and to you? Well, I beg to differ, Mr. Speaker, because what I am seeing from FPI right now is a company that is desperate to be able to create the Income Trust where they can sell off their shares. They are desperate enough, that in recent days they have made million dollar concessions to communities.

What have they done? They have created a division from Peninsula to Peninsula in this Province. That is what they have done. They have pitted one community against another. They were smart, Mr. Speaker. They were keen. They were keen corporate negotiators, that is what they were, because out of their Income Trust and their $100 million that they will make on the initial sale, what does it mean to put $4 million back into rural communities in this Province? What does it mean when you get right down to the bottom line of all of this?

We spent over $3 million in this Province last year on make-work projects, I remind the hon. members. What have we got to show for it today? We were able to bridge the gap for a few families for twenty weeks in this Province, from community to community. That is what we have had to show for it. Today, the $4 million is gone and we have the same problem.

In the region that I represent, when the cod moratorium was announced, we saw a complete shutdown of communities. I was an employment counsellor. I spent every single day of my life with those fisheries workers and their families, and I can tell you that the turmoil was great. It had lasting impacts. I do not ever want to see communities or people in this Province ever have to go through it again. I honestly do not, because it changed the whole fabric of the communities. It actually did. It caused people grief in their lives and, for some of them, I would suggest, probably sent them to an early grave, Mr. Speaker; the stress and the grief and the turmoil of it was so great.

I was participating in trying to help these people at one of the worst times in their lives and, do you know something? They had millions of dollars thrown at them by the federal government. They had all kinds of false hopes that were passed out to them on a daily basis, but year over year over year what happened, Mr. Speaker? There was no return of the fishery, there was no rebuilding of the groundfish. Many of them left and moved on with their families to other places, to other provinces. That is what happened.

Do you know something, Mr. Speaker? I was fortunate because I have a company in my district today that is owned by the people, that is a real co-operative, that works for the people they represent. Do you know something? There are four crab plants in my district - and you talk about resource availability. The crab quota in my district has been cut 80 per cent in ten years and I still have four crab plants, but do you know something? They are not making the money today they were making ten years ago. They are not putting through the product today they were putting through ten years ago. There might be 400 jobs there today as opposed to 600, but they did not close down. By FPI standards they may not be economically viable, but they are still there because they are committed to the people and they are committed to the communities. The bottom line for them is to break even.

SOME HON. MEMBERS: Hear, hear!

MS JONES: That is their bottom line, to break even and to make sure that the jobs stay there and the communities survive.

What are FPI's terms when it comes to economic viability? Next year when we see a crab cut in 3KL, where does that leave the plant in Bonavista, and the year after? Because, I can guarantee you, I live in a region where I have seen the stock, when it started to go, it went for five years consistently; the quotas dropped. In the last two years they talked about reductions in quota in 3KL, so where does this leave the commitment to Bonavista, the one that says in 2008 we will build a plant in your community if - if - the stock is available, if it is economically viable? Well, Mr. Speaker, I would suggest to you that is an awful lot of ifs.

What else are they saying? They are saying to the people in Fortune - who, by the way, only a short time ago, back a few weeks ago, in the spring, were told there may not be any operation in this community. There may not be any future in this community, and all of a sudden it is turned around. It is turned around because it was a small bargaining chip for FPI, I suggest to the members in this Legislature, a very small bargaining chip for FPI when it is going to cost them only a couple of million dollars if they do carry forward with it, a couple of million out of their $100 million-plus that they are going to make when this legislation goes through the House of Assembly. A small bargaining chip is what it is, but are they prepared to go far enough, far enough to ensure that the communities on the Connaigre Peninsula will survive and have a lasting legacy in the fishery?

They are not prepared to go that far, are they? They are not prepared to go that far because they do not want to give up the valuable asset that they have in fish quota, and that is the truth of the matter. That is where the real money is. That is where they are going to make money, and they are not going to want to give that up because they know that is their guarantee and their ticket down the road no matter what happens. Whoever gets control of this company, the most valuable thing that they can have is the resource that goes along with it. It is not a fish plant. It is not a $2 million investment that they are going to commit to next week or the week after. It is the actual resource itself, and we have seen it time and time again in this Province - the members talked about it tonight - where companies pulled out of communities and there was no quota, and what happened to those communities? They are still fighting today for their survival. They are reduced to rock bottom and yet they are still fighting, and I congratulate them for it, but, without the prospect of quota, things do not look all that bright for them, I can tell you that, and they know it. They are the example of the thirteen-year struggle in this fishery since 1992, many of those communities.

Mr. Speaker, I have a huge issue with the terms that are in this agreement because I think any time that you strike a deal with a company that says, I will invest in your community or I will invest in your workers if there is resource availability, which has not always been a very stable commodity in the Newfoundland and Labrador fishery, I can tell you, and history will show that, or if it is economically viable - Mr. Speaker, I am going to guarantee you, there are very few initiatives launched in rural Newfoundland and Labrador today that have been economically viable, but they have been done. There are very few government dollars that have been spent that could be justified as economically viable, but they were spent and it was done because of the need in the area, because of the responsibility to people no matter where they live. If we had to follow an argument that said economically viable, there would be half of the regions in this Province today without schools, without hospitals, without water and sewer, and without roads, I would suggest, because it never would have been economically viable to put them there. So, to have a contract and terms of an agreement conditioned on that very terminology is absolutely frightening.

Mr. Speaker, the other thing that I am worried about in this whole agreement is that of security. As I said, the quotas are the most important commodity and asset that this company has right now. When you look at the fact that they could renege on this deal and still not have to pass over the most valued quotas in the company - that being the shellfish quotas - to me, there is not a great deal of security there. I think that the government, in their negotiations, should have worked harder, should have made it an absolute condition of this agreement, that if they reneged at all on the commitments that they have made, that they would lose all of their quota allocations, shellfish and groundfish, and that the ownership that reverted to the Province would stay with the Province. That, Mr. Speaker, would have really raised the bar for FPI to make good on the commitments that they are telling us they are about to do now.

The other thing they should have had was security on their dragger fleet because, as you know, they have new draggers out there now and we should have had security on those. These are the things that are of the greatest value in the company. It is not the plant in Bonavista that is going to be the greatest value in this company, I say to the members. It is going to be those quotas and it is going to be that fleet. That is what we need to make sure that we get the security on, because those are the things that are going to be important.

The other thing, Mr. Speaker, that I see as a huge loophole in all of this is the fact that not only are we allowing FPI the opportunity, through this legislation, to be able to sell off 40 per cent of its marketing division, which comprises 60 per cent of the company, but we are leaving the door open for them to sell off the remainder of the marketing division at their pleasure. Mr. Speaker, I have a huge problem with that, because then you get concentrated ownership of the company that can fall in the hands of one, two or three people. That, Mr. Speaker, leaves us in this Legislature, and the people in Newfoundland and Labrador, with very little leverage in the future to hold this company accountable for any of its actions.

As you know, we have had many discussions with them in the past. Our leader, the Member for Twillingate & Fogo, talked about it this evening. I was part of the FPI panel that went around the Province and did the consultations, and I can tell you that there were lots of commitments made of investments that were going to be made in these communities that did not materialize. John Risley, who is one of the key players in all of this, who has been for a number of years trying to take over FPI as a company, gained greater ownership and greater access to it. In 2001, when he was speaking to the dissidents of FPI, this is what he said: that they would aggressively invest in new plant technology and that they would have an open view towards technology sharing and transfer within the fishing industry. He went on to say that the dissidents do not intend to close any of FPI's processing facilities in Newfoundland and Labrador or elsewhere.

Well, do you know how good his word is today? It was not worth the paper that this was typed on. It was not worth the paper that this was typed on, because the commitment that John Risley gave in this report a couple of years ago stating that no plants in this Province would close as part of FPI is absolutely false, because we see what is happening today. We see what is happening today in Harbour Breton. The member for the area has been, for months, lobbying aggressively with this company to try and build back an industry in that community, but to no avail and with no support from John Risley although this was the commitment that he made.

Let's see what John Crosbie had to say, who was a board member for FPI in February, 2002, when he stood up and said that Harbour Breton would receive the new IQF freezing technology, raw material defrosting, handling and grading equipment, flow lines to enable this plant to engage in H and G cod production, offsetting Harbour Breton's dependency on the diminishing stocks of redfish resource and therefore ensuring it a good future in this facility.

That is what he said, Mr. Speaker. He talked about the investment that they were going to make in Harbour Breton, how this plant was going to have a great future. He also went on to say that over the next few years there would be substantial investment needed to build a new plant in Harbour Breton, but what have we seen today? Where was the word of this board member of FPI? It was not again, Mr. Speaker, worth the paper that it was written on.

Now we are here in this Legislature presiding over a piece of legislation that could probably see the demise of the fishery in five years in a lot of these rural communities in this Province. That is what we are doing. FPI is looking for one thing. They are looking for a way to sell off assets, to put it into the hands of certain people, to make money on it when they are doing it, and if they have to offer up a few concessions today to get the public of Newfoundland and Labrador to buy into it, well, they are prepared to do it. They are prepared to do it and, I would suggest to you, at a very small price - a very small price.

Mr. Speaker, those of you who want to sit back and accept the words and the commitments of FPI, you can feel free to do so, but I have just read the commitments that I have received from FPI over the last few years when we went around the Province with the panel, went into all of these communities that we are debating and talking about today, and listened to the people in those communities. These were the commitments we got from FPI at that time. Where are we today? We are back here again today in this Legislature, trying to do the same thing, save plants and communities in this Province, when we should not have to be doing to do it, Mr. Speaker. We should not have to be doing it!

FPI, for years, was a great corporate citizen in Newfoundland and Labrador under the leadership of Vic Young, a man who believed in investing in rural Newfoundland and Labrador, who went out there and made sure that most of these plants survived, whenever it was possible to do so, bumped, I guess, with the shareholders and the stockholders of FPI on more than one occasion to accomplish what they did. Mr. Speaker, we do not see that social conscience today. We are not seeing that today. What we are seeing is a corporate negotiation where: I will give a little to get what I want. That is how I view it. I do not believe that a lot of this is in good faith, and I have to be honest with you, because if it was, it would not have taken the last twenty-four hours to get the concessions on the table. They would have been there twelve months ago, two months after the negotiations started. It was not on the table six months ago, and it was not there this spring when the Opposition was standing up everyday in this House of Assembly and asking questions about it, and what would happen in Bonavista and Fortune and Harbour Breton. The commitments were not there then, but they have been there in the last twenty-four or thirty-six hours, haven't they?

MR. SPEAKER (Fitzgerald): Order, please!

I remind the hon. Member for Cartwright-L'Anse au Clair that her time for speaking is expired.

MS JONES: May I have leave, Mr. Speaker?

MR. SPEAKER: Does the member have leave?

AN HON. MEMBER: Leave to clue up, Mr. Speaker.

MR. SPEAKER: Leave to conclude.

The hon. the Member for Cartwright-L'Anse au Clair.

MS JONES: Thank you, Mr. Speaker.

I was talking earlier about the $100 million in investment that FPI is going to get from the initial sale of this Income Trust, if the bill passes in the House. Again, as I said, we are not restricted to that 40 per cent. They can, indeed, sell off all of it over a period of time. Well, Mr. Speaker, they have said they will invest $30 million towards the debt. We do not know if that debt is a debt that is accumulated on the primary sector of the fishery in this Province or if it is accumulated on the marketing division, so we need to know that. The other thing they said, they will invest some money in our communities. I think it is about $4 million which is a minor amount.

Mr. Speaker, I would like to move an amendment, because I am concerned about where the remainder of this money is going to go. I would like to move this amendment, "That all the words after the word "That" be deleted and the following substituted therefore: This House declines to give second reading to Bill 41, An Act To Amend The Fishery Products International Limited Act, because adequate provisions have not been made to ensure that the funds raised through the sale will strengthen the company's operations in this Province." Mr. Speaker, that is moved by myself, the Member for Cartwright-L'Anse au Clair, and seconded by the Member for Bay of Islands.

The Clerk has already looked at the amendment, Mr. Speaker, and I have been informed that the amendment is indeed in order.

MR. SPEAKER: Order, please!

The Chair has not seen the amendment and the Chair will have to confer with the Table to determine whether the amendment is in order or not, so the House will take a brief recess and resume within a couple of minutes.

This House is now in recess.

Recess

MR. SPEAKER: Order, please!

The Chair has had an opportunity to read the amendment, as put forward by the Member for Cartwright-L'Anse au Clair, and confer with the Table. The Chair deems the amendment, as presented by the hon. member, is in order.

The hon. the Member for Burin-Placentia West.

MR. JACKMAN: Thank you, Mr. Speaker.

To say it is with pleasure that I rise and speak this evening is certainly not the case. I have sat and listened now for nearly nine hours, and I think that from the first time I came and sat in this House this has been the most somber day and the most attentive day that I have seen members of this House of Assembly. I can honestly say, Mr. Speaker, that up on the third floor here, over the last number of days as I have spoken with other members from my caucus and I have listened to members of my caucus speak back and forth to each other, this is something that is weighing heavy on all members.

One thing I think is inherent in this, and why there is so much attention to this, is that this debate is not so much about FPI, this is a debate about communities. This is a debate about rural Newfoundland and Labrador and its future. All members of this House who have risen and have spoken, have spoken to some degree about their attachment to the fisheries and how they feel connected to this issue. Mr. Speaker, I would say to you, that of all the members in this House who have spoken, I stand in a unique position. In fact, it is quite an ironic situation that I have found myself in.

This evening, as I have sat and looked across at the people who are sitting in the galleries, this story has come back to me again and again. Mr. Speaker, most people in this House of Assembly would not know of a resettled community of Grole. I feel pretty assured that the people in the galleries would know of where that community is. In October of 1968, some of the people in that community resettled to Marystown. The people who went to Marystown, my father being one of them - and I counted it up tonight, and I believe there were ten families who moved from that community to Marystown - went to Marystown for one sole reason. A lot of the people in that community, my father included, was a lumberjack and he spent most of his days in the lumber woods away from the family. They moved to Marystown - I was fourteen at the time - because there was a fish plant there that was employing, and not only employing but employing a lot of people. All of the people who moved from that community to Marystown went to work in that plant. The hours were there, the money was there, and the families were there. I find myself in a situation tonight, facing the people in the galleries, realizing that the rest of that community resettled to Harbour Breton.

In October of 1968, around that time, this community resettled and here we are tonight - and I am in the situation where my family, my first cousins, my aunts and uncles, my father's brothers, are in Harbour Breton. No one has to tell me what they are feeling in Harbour Breton. Three of my cousins have businesses there. More of my relatives work in the plant there. I know exactly what they are experiencing.

Then, on the other hand, I am here as a representative for the District of Burin-Placentia West, and in this proposal, this bill that we have before us, and the proposals that FPI are putting forward, I am in a situation where I can comment on FPI from a different perspective. Have there been problems with FPI in the District of Burin-Placentia West? Yes, there have. People have referenced the meeting in 2002. I was at the motel when that meeting took place and someone said, it is wonder that John Crosbie was not killed that night. Yes, I can believe it.

However, Mr. Speaker, the union, along with the company, worked out an arrangement whereby today there are some 600-odd people working in that plant in Marystown. Then, Mr. Speaker, if we go to Burin - and Minister Dunderdale has already spoken about Burin. I remember the situation, but not to the extent that she does and the extent that she was involved. In my meeting with the Town Council of Burin, and the Mayor in particular, whose father was the one that was in the ditch that Minister Dunderdale referenced, they very quickly reminded me of the fight that they put up for their plant and its survival.

Mr. Speaker, if I look at the two plants, Marystown and the Burin - and the union local president, Mr. Alan Moulton, who I can assure you has worked very closely with the company to work out the arrangements that they have there, pointed out to me that the Marystown plant is a culmination, because the groundfish processing that happened in Burin was relocated to Marystown as was Grand Bank. Mr. Speaker, when we say it is a Marystown plant, it is not a true statement. I can start for you right in the northern part of my district, in Brookside. I can go to Boat Harbour, to Parkers Cover, to Baine Harbour, to Rushoon, to Red Harbour. I can go all the way around the boot, from Grand Bank to Lamaline to Lawn to St. Lawrence to Lewin's Cove to Burin and back again into Marystown, and that is who works in the plant.

Mr. Speaker, although there have been problems and there have been issues that have had to be dealt with, FPI in Marystown has been a valuable employer. The businesspeople in the area will tell you, as much hype as there has been about the SeaRose project in Marystown and the influx of workers, people will tell you it is not these mega projects that drive the economy of the Burin Peninsula, it is the fish plant. They will tell you that when the fish plant is working and is up in operation, that is when their businesses do well. So, Mr. Speaker, in Marystown, as in Harbour Breton, FPI has been a valuable employer. Even through the days of the moratorium, people still managed to eke out their living there in that plant.

If we go to the secondary processing in Burin, the union local president said to me the other day that he believes right now that Burin is operating up to 90 per cent capacity. The reason being is that they are doing more value marketed products there. Recently, Ocean Cuisine started another line of Margaritaville products there which they have taken from Danvers, Massachusetts, which again has added to the workforce of Burin.

I said, Mr. Speaker, the other night in a meeting with both the union and the town, that there are a few younger people getting into the workforce in the Burin area, and this is a positive thing to see. When it came down to the deal making and when Fortune came into the scene, I will tell you, the exact comment of the union people and the towns. The one thing that they wanted was they did not want to lose some of their workforce because of the secondary processing that would take place in Fortune, but they certainly were not against Fortune getting their secondary processing facility up and running.

Mr. Speaker, I have risen and I have been quoted as saying that I think the Burin Peninsula is a unique entity, much the same as the Connaigre Peninsula. We are geographically a unique group and therefore, we have to co-operate. If there is one thing that has happened with all the talks about reductions in quotas and so on and so forth, the people of the region, I think, have come to realize that if we are going to survive as a region we have to work together. Therefore, the support for Fortune and the support that is going to be needed so that Fortune people can access work in Marystown in the interim until their facility is up to what FPI intends.

Mr. Speaker, I cannot get up here and speak negatively about Fishery Products International as an employer. As a processing facility, both in Burin and in Marystown, in my district, they have been there. As I said, my people moved there in 1968 for work and they continue to work there.

So, Mr. Speaker, where are we? When I considered speaking in regard to this bill, I have listened to all of the numbers, I have listened to the legal opinions, I have considered the commitments that the company have put forward, I have spoken to the towns and the union reps and, Mr. Speaker, the bottom line here is it comes down to the workers. All the workers ask for is a decent wage. They ask for fair treatment and steady work. As I rise and speak on this thing, I have to say that because Marystown and Burin have been steady employers, I will support this bill.

Other factors come into play here, Mr. Speaker. I have thought much about this, and whether it be this company or any other company - I listened to an address given by the Minister of Fisheries in Marystown last week at a convention there and my readings on it and his comments on it reconfirm and reaffirm the many challenges that a company in the fishing industry faces. If we think that we can operate without consideration of the global markets, or if we think that we can operate without consideration of the, let's say, the Chinese factor - Mr. Speaker, I spoke to the manager of the plant in Burin last year, he tells me that the Salmon Elites, that they produce as a product in Burin, the salmon comes from Chile.

So, a company in the global market at this time have many factors that they have to consider. Then I look at some of the numbers that have come across my desk over the last couple of days. Groundfish: In 1987, in this Province there were 297 million pounds processed; in 2004, 39 million; in Marystown, in 1993, there were 74 million pounds processed; in 2004, there were 39 million. With numbers like that, what other options are there? It is little wonder we find that plants are struggling. These are the realities. These are the factors that these companies face.

Mr. Speaker, we have spoken about, and people have spoken about, the guarantees. I have little doubt that over the past fourteen months many nights and many hours have been spent negotiating. Somewhere I read in the package that was handed out to us, that in the beginning FPI made no commitments to the Province in terms of processing. However, despite the negotiating by the Premier, Minister Dunderdale, Minister Taylor and the other members of the team, we have made progress. We have opportunity in Bonavista. When I hear the Member for Grand Bank say that she will support this, we have opportunity in Fortune.

Mr. Speaker, when I think of the residents of Harbour Breton and the plight that they find themselves in tonight, I cannot stand here and not feel for them. I do not think that there is anyone in this House, or anyone from the Community of Harbour Breton, who can say that there is an individual who has worked any harder for the cause of Harbour Breton than the Premier. He stands committed to rural parts of this Province and, truly, I believe that he stands committed to the Town of Harbour Breton. For me, I can stand here this evening and say that the FPI commitment to my district shows favour and a future. My constituents, my union, the union reps who I have met with, and the towns stand, I would not say firmly behind this, but they certainly see it as securing a future for them. I want to say to the people of Harbour Breton that we, as a government, will stand behind them. We will not forget them, and every ounce of energy that we have, that we can put behind that community, we will do so.

Mr. Speaker, I think, and I certainly hope - and there are no guarantees in this, but I have had to ask myself: If I do not support this, what could it possibly mean? Could it mean that this company could go under? The Member for Carbonear-Harbour Grace said today: Do we need FPI? Well, I think the people of Harbour Breton would say they do, and I can assure you that the people of Burin-Placentia West and the people of the Burin Peninsula do need FPI. So, in making my final decision I have to consider the implications for my district and for my region, as a peninsula, if this company were to fall. I have to vote in support of this.

So, Mr. Speaker, I will conclude again by saying, in 1968 we moved to Marystown. The people from my community who moved to the Burin Peninsula have been served well by FPI and that entire region. It is kind of ironic, as I have already said, that tonight I stand in this House and see a community that divided in 1968 - one has gained the advantage of this decision while the other one strives to find a way to support them.

MR. SPEAKER: Order, please!

I remind the hon. member for Burin-Placentia West that his speaking time has expired.

MR. JACKMAN: By leave, just for a minute, Mr. Speaker?

MR. SPEAKER: By leave?

AN HON. MEMBER: Yes.

MR. SPEAKER: The hon. member by leave.

MR. JACKMAN: I will conclude by saying this, and I reiterate what I have already said. This government, this Premier, these ministers are committed to rural Newfoundland and Labrador. Again, I say to the people of Harbour Breton, to many of my relatives who I would say are watching tonight, that as the Member for Burin-Placentia West and a Member of this House of Assembly I will do whatever I can and influence whomever I can to assist their cause.

Thank you, Mr. Speaker.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: Order, please!

The hon. the Member for Torngat Mountains.

MR. ANDERSEN: Thank you, Mr. Speaker.

I rise tonight to speak to Bill 41. Mr. Speaker, I can assure you that I rise tonight with mixed emotions. Emotions of good times that are about to happen to the North Coast of Labrador with our stone quarries, with Voisey's Bay and with self-government just around the corner. Mr. Speaker, our future looks very bright, but there is also a part of our past that I want to speak of tonight because I feel very deeply for the people in Harbour Breton.

Mr. Speaker I want to go back to the failure of the cod fishery. When the TAGS program came out, NCARP, it was based on your landings in certain years. The people in my riding, in the riding of Torngat Mountains, got word that the two years on which they based your landings, that is how they would base your TAGS program. The cod fishery had failed first, Mr. Speaker. They had no landings. There was no TAGS program, Mr. Speaker. There was nothing.

Mr. Speaker, I stood in this House on several occasions, and I am not sure how many members on either side of the House heard what I said about the devastation that the people on the North Coast of Labrador faced. I can tell you, it was not easy. Hard times, that is not a word to use, hard times. Devastation is more like it, starvation.

Let me tell you what it feels like when you have a man and a woman who cannot afford to buy a Christmas card for their spouse at Christmastime, let alone a Christmas present; when you have a mom who feels for her children who are going to go to school - she has three of them - and she saved a few pennies along the way and she can only buy one coat. That is the gospel truth, Mr. Speaker. Imagine what she felt like having to say no to two of her own flesh and blood. Imagine the tears that she shed night after night, not knowing where the next dollar was going to come from.

There was social assistance, the last thing that people who built this Province on the fishery want to become a part of. Granted, there are some people in life who have to avail of that because of no fault of their own, but not when your way of life is taken away from you.

Mr. Speaker, I travelled back and forth the North Coast into the Riding of Torngat Mountain all too often to say goodbye to one of our brightest and best loved ones. Because of the devastation they faced, they felt their lot in life was not worth living for.

Anyone who followed the plight of the Aboriginal people on the North Coast of Labrador will know that our darkest days followed when the fishery was taken from us and there was no compensation. One part of this Province was left out and left behind; and, Mr. Speaker, that is the fear, and I say fear, for Harbour Breton.

Mr. Speaker, when I give these examples, I am not saying that to put fear into the minds of the people in Harbour Breton, but to tell the honest-to-God truth as to what happens when certain parts of our Province are left behind. After we lost five or six people in about three weeks, I travelled back to the North Coast with the Premier of the day, and halfway through the five ridings, the Inuit ridings - because there are five Inuit ridings, communities, and one Innu community - I remember one night in Hopedale, he said: My God, how can this happen? I looked across the table at him and I said: Mr. Premier, it is because politicians and the provincial and the federal government let it happen. They let it happen, and a part of our Province was left out.

Mr. Speaker, I am travelling to Ottawa on Sunday or Monday, and I am going to watch as our land claims is going to go through the House of Parliament. I know that the dark days that we faced, hopefully, are going to come to an end, and that revenues from Voisey's Bay will reach into every part of this Province. I can tell you, with our stone quarries, for the people we have working there, and, in the last month, the number of people from my riding who have permanent jobs in Voisey's Bay, it is a godsend. The people in Harbour Breton do not have stone quarries and they do not have a Voisey's Bay in their backyard.

Mr. Speaker, I am glad for Bonavista. I am glad for the Member for Bonavista South, a good friend of mine, who I had travelled with several times on all-party committees to Ottawa. The first one was to get more money for the TAGS program; but, again, my riding received not one cent.

Mr. Speaker, I will tell you what I would like to see before the vote is taken, because we have lots of time, and that is an all-party committee from this House, along with FPI and the other major stakeholders in the fishery in this Province, travel and sit down face to face with the federal government; because if we can bring home the Atlantic Accord for our offshore oil and gas, then surely God, Mr. Speaker, we can bring something back to the people of Newfoundland and Labrador, because it was the cod fishery that built this beautiful Province that we live in.

Mr. Speaker, in closing, let me say this: To every Member of the House of Assembly, on the government side and here, listen: It is in our hands now. It is in our hands as to what happens to Harbour Breton. What I will say to every Member of the House of Assembly here tonight is: I plead with you and I ask you - no, Mr. Speaker, I will do something that I have never done in my life - I will beg you. I will beg every member to make sure that we never, ever let happen to Harbour Breton and the Connaigre Peninsula what was allowed to happen to the people on the North Coast of Labrador. It is in our hands now. It is in our hands.

It is sad today when you hear that there is no guarantee in all of this, that it may not fall through for Bonavista, it may not fall through for Fortune, but we have the time, we have the talent, I do believe, and, most important of all, we have the care by the people who sit in the House of Assembly to do this and do it right.

Regardless of how the vote goes tomorrow - because it will either be passed or it is going to be turned down - if it passes, it will pass with no guarantee, as the Premier said today, of any of the promises that FPI made. So let's do something for our people and the people in Harbour Breton. Let's get something cast in stone for the first time ever.

Let me say this one more time, to all of you: Please, for the love of God, do not let happen to Harbour Breton what happened to the people on the North Coast of Labrador.

Thank you, Mr. Speaker.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER (Hodder): Before we move to the next speaker, the Speaker would like to advise members that on tomorrow we will only have satellite time for our television services to the people of Newfoundland and Labrador from 10:00 a.m. until 11:30 a.m. Then our broadcast will be pre-empted by a more frequent user. We cannot do anything about that; however, we will be broadcasting the entire session at a later date. On tomorrow morning, before 11:30, I will announce when that will be telecast to the people of Newfoundland and Labrador. It will be telecast.

We regret any inconvenience this may cause to the many hundreds and hundreds of people who will be watching this particular sitting of the House by way of television.

Again, I will announce tomorrow the exact time when the taped version will be broadcast to the people of Newfoundland and Labrador.

The hon. the Member for Bonavista North.

SOME HON. MEMBERS: Hear, hear!

MR. HARDING: Thank you, Mr. Speaker.

I, too, welcome the opportunity to speak on Bill 41, an issue that affects a very large portion of the rural parts of Newfoundland and Labrador; an issue that impacts greatly on the full economy of this Province; an issue that could determine the survival or the destruction of a number of fishing communities in our Province; an issue that has put a major responsibility on the elected members of this Legislature. I, as one member representing a district that has been mainly dependent on the fishery, have been stressed and disturbed about the decision that I have to make tomorrow.

Mr. Speaker, I have many fears, I have many doubts, I have many concerns, about this whole proposal and its potential long-term implications on the Province in general and on rural Newfoundland in particular. This evening, I want to take this opportunity to express some of these concerns.

Let me go back, just for a minute, and reflect on the main purpose of the FPI Act. That Act was to provide a means for a company, then known as Fishery Products, to adjust from a government-owned company to a privately-owned company. It was to create a company whose primary objective was to strengthen the Newfoundland fishery and, as some people have already mentioned here, to be sort of a flagship for the Newfoundland fishery; a company that would be economically viable, efficient and modernized to make it competitive in the international marketplace.

Today, Mr. Speaker, in 2005, the company, known as Fishery Products International, after investing millions of dollars in modernizing its fishing vessels, after investing millions of dollars in upgrading its plant and equipment, still finds itself struggling to compete with the challenges in the global marketplace.

Despite these investments, and I understand that more than $100 million over the past three years the company has invested in their industry, today they are calling again for government to assist them, to help them for future growth and future sustainability. That is why we are here today and tomorrow. We are being asked by Fishery Products International to provide them the means to access capital through an Income Trust. It is the word trust that has been bothering me considerably, not in terms of funds or financial proceeds, but the word trust in the context of believability, in the context of reliance, to have faith in, to have a secure degree of confidence in knowing that what is put in that agreement will be adhered to. Mr. Speaker, I believe that is a concern also of a large number of people in Newfoundland and Labrador who have being following this issue.

Mr. Speaker, let me say a few words about the four plants, in particular, that we have being referring to this day and with this issue. I want to express my concerns with what has happened so far, and I mean the plants at Bonavista, Burin, Fortune and Harbour Breton. Let me start with the crab plant in Bonavista, a plant that I am a bit familiar with; a plant that I have visited several times, a very old plant, a very inefficient plant, mainly due to the structure and the design of the building. The company was faced with the option of building a new crab plant in Bonavista or moving its operations to the much larger, more modern, underutilized plant in Port Union, just a fifteen or twenty minute drive from Bonavista. While the company has been faced with this dilemma for quite some time, it was just on Tuesday night of this week, just a few hours before we are to vote on a proposal in this House of Assembly, that FPI made the announcement that they have agreed to build a state-of-the-art crab plant in Bonavista.

I want to say, Mr. Speaker, that I am very pleased for my colleague, my friend from Bonavista South, and for all the people who live in the Bonavista area, but I am still concerned about the timing of that decision. I am also concerned about a statement made by the CEO of that company, Mr. Rowe, back in December of 2004, in an issue of The Navigator. In that issue, Mr. Speaker - and I will quote from The Navigator now. He was responding to questions about the competitive pressures in the marketplace with respect to the Canadian dollar and the Chinese competition. Mr. Rowe said in that statement that any business advisor examining an operation, put under huge competitive pressures, would probably say that the operation must modernize, must increase efficiencies and must reduce costs.

Mr. Speaker, that statement, to me, somewhat conflicts with the decision that he made on Tuesday night. What makes this decision more difficult to understand and accept is the fact that we, in this Province, are facing a major decline in the crab resource, and that is no secret to anyone. So, I find it difficult to understand just where he is coming from. My sincere hope for the people of Bonavista - and also, I might add, the people in Triton, where there is an FPI crab plant - that the conditions in the agreement that we are talking about, where we specify an adequate resource supply and economic viability, I hope that these conditions do not become a loophole for escape for Fishery Products International. I am concerned about that.

Mr. Speaker, let's look at the plants in Burin and Fortune. Again, I want to reflect back to Mr. Rowe's statement of increasing efficiencies and reducing costs. The company already has a modern state-of-the-art secondary processing plant in Burin with a fully trained workforce; a plant that has been operating, up until only recently, at between 65 per cent and 70 per cent capacity. I know my friend from Burin-Placentia West indicated that they are now at 90 per cent but I think, as he has stated, that is because of the transfer of some of the production from their Danvers plant in Massachusetts to the Burin facility.

Again, Mr. Speaker, I find it interesting to note, that just a day or two before the vote on their proposal they announced that the $8 million for secondary processing on the Burin Peninsula is now going in the Fortune plant rather than fully utilizing the facility that they have in Burin. However, Mr. Speaker, I am glad as well for the people of Fortune but the timing of this decision has to be questioned, and I am concerned about that as well.

Now, Mr. Speaker, let me get to Harbour Breton. Here we are talking about a people who have known nothing but the fishery for survival and a way of life; a people who were used to working practically year-round in the groundfish fishery. I do not understand, for a minute, where the federal government is standing on this issue in helping the people of Harbour Breton -

SOME HON. MEMBERS: Hear, hear!

MR. HARDING: - because it is through mismanagement of that groundfish fishery that is one of the main reasons why plants like Harbour Breton are in the situation that they are today.

Again, Mr. Speaker, I am talking about a people in Harbour Breton who were used to being out fishing on the water and working in the plant during the winter months when the plants on the Northeast Coast and most of the Province were shut down and the fishermen had their boats ashore. We are talking about a people who have made a major contribution to the success of Fishery Products International over the years.

Mr. Speaker, coming from a fishing community myself, I have nothing but the greatest of respect and admiration for the people in Harbour Breton. Now I have to say, I have sympathy at this time for these people. I do not think that they have been given a fair shake by Fishery Products International in this deal. If you just look at the $3 million they have offered as a cash offer, it appears that that $3 million is what they are legally entitled to anyway in lieu of the lack of lay-off notice under the Labour Standards Act. Every employer in this Province is liable for the same thing when due notice is not given to its employees.

Let's look at the gesture of offering the plant to the town for $1. It may appear genuine on one hand but if you consider the reasons why FPI shut down that plant, one being their operating losses and the other because of the building being structurally unsafe. When you look at that, the offer becomes much less attractive.

So, what is ahead for the people in Harbour Breton? I believe one thing, Mr. Speaker, that with the federal government coming onside and a retirement package for those people who are eligible and who want to retire is one thing that can be done. With some additional funding from Fishery Products International to help upgrade that plant and correct any environmental problems that exists, is another thing that can be done. FPI can also leave the redfish line in that plant just in case the plant does receive a redfish quota.

With access to other quotas as well, other species, Mr. Speaker - such as pelagics, shrimp and redfish, and with the procurement of cod that is landed along the Connaigre Peninsula - I believe that there are a number of processing companies in this Province, outside of FPI - leave FPI out all together. There are a number of processors who could go into that community and make that plant a viable operation.

SOME HON. MEMBERS: Hear, hear!

MR. HARDING: I believe, Mr. Speaker, that Harbour Breton should be given this opportunity.

Mr. Speaker, I want to say a few words about the trust money itself. We know that $30 million will be used to pay down the company's debt on its Newfoundland fishing assets. We know that approximately $16 million will be spent on its plant workers, on its plants and its former workers in the Province. This $16 million includes the $8 million that they are talking about spending on the Fortune plant. I would assume that the money they are going to use to put a new crab plant in Bonavista will also come from the trust money, but that still leaves the company with probably close to $50 million from the anticipated $100 million that they expect to receive from the Income Trust.

There are concerns, many concerns, Mr. Speaker, as to where that money will go. Mr. Rowe has already stated that the cost of operating their frozen-at-sea vessels is way down. The cost to operate these vessels is way down. He goes as far as to say that if they hadn't invested in these vessels they would be, probably, out of business. You have to wonder, if these vessels are as important as that to their bottom line, will some of this $50 million be used eventually to purchase another one of these vessels?

Mr. Rowe has also made the comment about facing the Chinese competition head on. Does this mean that maybe some of this $50 million will be spent in purchasing or building their own processing plants in China? If not from the sale of this 40 per cent of the Income Trust now, maybe as time goes on in the future, from the sale of other portions of OCI, will that be used to build processing plants by Fishery Products International right in China? Is that what he means by facing the Chinese competition head on? That way it would give them the benefit that they receive by getting the fifteen cent an hour labour cost of the Chinese people when it comes to production. If this ever happened, Mr. Speaker, it would be a major concern. It could have direct implications, not only what is left of Fishery Products International groundfish operations in this Province, but it would have negative consequences on the groundfish operations on every processor in this Province.

Mr. Speaker, I believe that one of the greatest fears of all is that of one of FPI's principle shareholders, Mr. Risley. Most people do not forget, and I am one of them, the hostile bid takeover of FPI, led by Mr. Risley and his partners five years ago. A major concern now is the fact that maybe, just maybe, we could be opening the door for an eventual takeover of the most lucrative part of that company. I am very pleased to say on that, Mr. Speaker, that I am very pleased to see that the Premier and the government have stopped the request from Fishery Products International, when again they have asked to lift the restriction on the individual shares from 15 per cent to 20 per cent. I am very pleased that our government has stopped them again in that request.

Mr. Speaker, over the -

MR. SPEAKER: Order, please!

The hon. member's time has lapsed.

SOME HON. MEMBERS: By leave.

MR. SPEAKER: By leave.

Leave has been granted to make some concluding comments.

MR. HARDING: Thank you, Mr. Speaker.

Mr. Speaker, over the past number of weeks and days, I have talked to a large number of people about this matter. I have talked to a number of friends who are very knowledgeable in the fishery. I looked very carefully at the commitments that have been made that our Premier and our negotiators have obtained or have pressured FPI into granting. I have looked very seriously at the consequences of not supporting this proposal at this particular point in time. Mr. Speaker, on balance, I have satisfied myself to some extent, that the commitments made by the company and the penalties they have agreed to for non-compliance, and that they put in writing in the term sheet, are satisfactory under the circumstances and, hopefully, have been made in good faith. I say that at this point in time.

Again, I want to comment the Premier and our negotiating team for the excellent job that they have done so far in getting the company to grant the commitments that they have, when you consider that when we started a little over a year ago they had no commitments made at all.

Mr. Speaker, there is still one missing link in this whole thing, and that is the people of Harbour Breton. I also acknowledge, Mr. Speaker, the potential negative impact on many communities in rural Newfoundland if we fail to give the company the opportunity to raise the capital required at this point in time to sustain and grow their business.

Mr. Speaker, I will listen to the rest of the debate on this issue. I will consider the results of any further consultations and negotiations with the company before exercising my right to vote. A decision that I will make based on the best information available will be made in the best interest of the public and the public interest of the people of this Province.

Thank you, Mr. Speaker.

SOME HON. MEMBERS: Hear, hear!

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

MR. RIDEOUT: Mr. Speaker, thank you.

Pursuant to agreement, I now move that this House adjourn until tomorrow at 10:00 o'clock.

MR. SPEAKER: It has been moved that this House at its rising do adjourn until tomorrow, Friday, June 10, at 10:00 a.m.

All those in favour, ‘Aye'.

SOME HON. MEMBERS: Aye.

MR. SPEAKER: All those against, ‘nay'.

Carried.

This House now stands adjourned until tomorrow at 10:00 a.m.

On motion, the House at its rising adjourned until tomorrow, Friday, at 10:00 a.m.