The Nova Scotia Legislature

The House resumed on:
September 21, 2017.

Hansard -- Thur., Apr. 25, 1996

Fourth Session

THURSDAY, APRIL 25, 1996

TABLE OF CONTENTS PAGE
GOVERNMENT BUSINESS:
GOVERNMENT MOTIONS:
Res. 218, Estimates - Comm. of Whole House on Supply,
Hon. B. Boudreau 1037
Hon. B. Boudreau 1037
Mr. R. Russell 1047
Adjourned debate 1050
GOVERNMENT NOTICES OF MOTION:
Res. 334, Workplace - Girls & Boys: Equal Future - Ensure,
Hon. E. Norrie 1051
Vote - Affirmative 1051
Res. 335, Women - Voting Rights (Anniv.): Electoral Process -
Participation Encourage, Hon. E. Norrie 1052
Vote - Affirmative 1053
NOTICES OF MOTION:
Res. 336, Commun. Serv. - Debra Stevens: Compensation Negotiations -
Stalling Condemn, Dr. J. Hamm 1053
Res. 337, Fin. - PST & GST Harmonization: Special Comm. -
Establish, Mr. R. Chisholm 1053
Res. 338, Halifax Needham MLA - Mun.: PST/GST Imposition - Oppose,
Mr. G. Archibald 1054
Res. 339, Take Our Daughters to Work Day: Participants - Commend,
Mrs. L. O'Connor 1054
Vote - Affirmative 1055
Res. 340, Liberal Party (N.S.) - AGM: Sydney - Location Applaud,
Mr. Manning MacDonald 1055
Vote - Affirmative 1055
Res. 341, Gov't. (N.S.) - Broken Promises: Leader - Admit,
Mr. T. Donahoe 1056
Res. 342, Fin. - Budget Balanced: Hfx. Citadel MLA - Enjoy,
Hon. R. Mann 1056
Res. 343, Fin. - PST & GST Harmonization: Consultation - Urge,
Mr. J. Holm 1056
Res. 344, Women, Status of - Advisory Council: Appointments Process -
Detail, Mr. D. McInnes 1057
Res. 345, Sports - Hockey: Mr. Ray Turner (Beechville) - Success,
Mr. B. Holland 1057
Vote - Affirmative 1058
Res. 346, Take Our Daughters to Work Day: Importance - Recognize,
Mr. R. Chisholm 1058
Res. 347, Enterprise C.B./Crew Productions (New Waterford):
Award Winners (American Econ. Dev. Council) - Congrats.,
Mr. A. MacLeod 1058
Vote - Affirmative 1059
Res. 348, Fin. - PST & GST Harmonization: Mun. Costs Add. -
MLAs (L-Hfx. Co.) People Rep., Mr. B. Taylor 1059
Res. 349, Justice - Correctional Facilities: Privatization - Cease,
Mr. J. Holm 1060
Res. 350, Children's Wish Foundation - NSLC (Welton St., Sydney):
Kindness - Congrats., Mr. A. MacLeod 1060
Vote - Affirmative 1061
Res. 351, Transport (Canada) - CNR Hfx. Fairview Closure:
Premier Record - Voters Judge, Mr. G. Archibald 1061
Res. 352, Fin. - PST & GST Harmonization: Books Tax Increase -
Condemn, Mr. J. Leefe 1061
Res. 353, Timberlea-Prospect MLA - Mun. Tax Increases: Gov't. (N.S.) -
Change, Mr. B. Taylor 1062
Res. 354, Fin. - PST & GST Harmonization: Cancellation - Clause Insert,
Mr. T. Donahoe 1062
ORAL QUESTIONS PUT BY MEMBERS:
No. 170, Fin.: PST & GST Harmonization - Results, Dr. J. Hamm 1063
No. 171, Fin. - PST & GST Harmonization: Memorandum of Understanding -
Table, Mr. J. Holm 1065
No. 172, Fin. - PST & GST Harmonization: Electricity Costs - Increase,
Mr. T. Donahoe 1066
No. 173, Environ. - Sydney River: Lead Contamination - Solution,
Mr. A. MacLeod 1068
No. 174, Environ. - Sydney Tar Ponds: Risk Assessment - Commit,
Mr. A. MacLeod 1069
No. 175, Fish. - Processing Plants: Fees Increase - Action Plan,
Mr. J. Leefe 1070
No. 176, Fin. - PST & GST Harmonization: Consumers - Effect,
Mr. R. Chisholm 1072
No. 177, Fin. - PST & GST Harmonization: Share (N.S.) - Fixed,
Mr. R. Russell 1074
No. 178, Fin. - Taxation: Flat Rate - Introduction, Mr. R. Russell 1075
No. 179, Commun. Serv. - Debra Stevens: Compensation Negotiations -
Breakdown, Dr. J. Hamm 1077
No. 180, Transport. & Pub. Wks.: Hwy. No. 104 Western Alignment -
Workers (N.S.), Mr. B. Taylor 1078
No. 181, ERA - IMP Plant (C.B.): Workers - Purchase, Mr. R. Chisholm 1079
GOVERNMENT BUSINESS:
PUBLIC BILLS FOR SECOND READING:
No. 10, Regional Community Development Act 1080
Mr. J. Holm 1080
Mr. T. Donahoe 1082
Hon. R. Harrison 1091
Vote - Affirmative 1094
No. 11, Children and Family Services Act 1094
Hon. J. Smith 1094
Mr. A. MacLeod 1095
Adjourned debate 1097
ADJOURNMENT:
MOTION UNDER RULE 5(5):
Justice - Correctional Facilities: Privatization - Cease:
Mr. J. Holm 1098
Mr. T. Donahoe 1100
Hon. W. Gillis 1102
ADJOURNMENT, House rose to meet again on Fri., Apr. 26th at 11:00 a.m. 1105
[Page 1037]

HALIFAX, THURSDAY, APRIL 25, 1996

Fifty-sixth General Assembly

Fourth Session

2:00 P.M.

SPEAKER

Hon. Paul MacEwan

DEPUTY SPEAKER

Mrs. Francene Cosman

MR. SPEAKER: Order, please. I would like to call the House to order at this time to commence the daily business. By agreement, we will call on the Minister of Finance at this time to present his Budget Address.

ORDERS OF THE DAY

GOVERNMENT BUSINESS

GOVERNMENT MOTIONS

[Res. No. 218, re Estimates - Comm. of Whole House on Supply - notice given Apr. 17/96 - (Hon. B. Boudreau)]

MR. SPEAKER: The honourable Minister of Finance. (Standing Ovation)

HON. BERNARD BOUDREAU: Mr. Speaker, pursuant to a notice of motion given by me on March 31, 1996 and the Rules and Forms of Procedure of the House of Assembly, I have the honour, by command, to present a message from His Honour the Lieutenant Governor of the Province of Nova Scotia, relating to the Estimates of sums required for the service of the province for the fiscal year ending March 31, 1997 which is:

"I hereby transmit Estimates of Sums required for the Public Service of the Province for the year ending March 31, 1997, and in accordance with the Constitution Act, 1867, recommend them, together with the budget address of my Minister of Finance and any resolutions or bills necessary or advisable to approve the Estimates and implement the budget measures, to the House of Assembly.

1037

[Page 1038]

Signed,

J. James Kinley

Lieutenant Governor

April, 1996".

Mr. Speaker, at this time, I wish to table the message from His Honour the Lieutenant Governor, table the Estimate Books, table the Estimate Resolutions, and deliver my Budget Speech. I will, as well, move that the Estimate of Sums required for the Public Service of the province for the fiscal year ending March 31, 1997, being Supply, to be granted to Her Majesty be referred to the Committee of the Whole House on Supply.

I. INTRODUCTION

Mr. Speaker, I am pleased and privileged to present to the Legislature, and to the people of Nova Scotia, the government's budget for the 1996-97 fiscal year. It is a budget that is historic, both for what it contains and for what it does not contain.

The financial plan we are unveiling today is an achievement more than two years in the making. Today, Nova Scotians share in an accomplishment worthy of distinction.

What this budget does not contain, Mr. Speaker, is a deficit. For the first time in a quarter century, we do not have to borrow from the future to pay for the present.

What this budget does contain, are the first tangible rewards to come from the arduous climb back to solid financial ground. Today, we can see a future with more promise than we have known for many years.

Mr. Speaker, two years ago when I stood in this House to deliver a budget, Nova Scotia was at the brink of financial ruin. Today, our finances are sound. Two years ago, our economy was foundering. Public services were in danger of collapse under the weight of massive public debt. Today our economy is growing stronger, tax relief is imminent, and our vital public services are secure.

We have come a long way. Just three years ago, deficits in the hundreds of millions of dollars were considered business as usual. Our debt was exploding, and payments on that debt were swallowing more and more of the money needed for services to Nova Scotians.

This government embarked, first on an emergency program and then on an orderly plan of recovery. But even with the latter, immediate and dramatic action was required. Significant and in some cases radical changes had to be made to the operations of government. Anything less would have doomed us to failure.

Today, old inefficient bureaucratic systems are giving way to new effective services to people. Public programs are safe, because we can afford them. The way has been paved to a more competitive Nova Scotia that can offer opportunity to all.

We have come a long way, but we have a way to travel yet. Our province must stay on solid financial ground and build competitive advantages that help business, industry, and individuals grasp the opportunities those advantages will provide.

[Page 1039]

II. ECONOMIC CLIMATE

Nova Scotia's economy continued to grow in 1995. That growth moderated to 1.6 per cent, in part because of the profound structural changes that we are making. The public sector is no longer the engine of economic growth. Private-sector productivity is the source of new wealth and lasting jobs. This reality was reflected in the province's employment picture last year. In 1995, employment in the province grew by 1.1 per cent. The private sector created 6,000 jobs, while Nova Scotia experienced a net gain of 4,000 new jobs.

Mr. Speaker, Nova Scotians should welcome this fundamental economic shift. For too long, too much of our economy depended on government spending. Growth based on public spending was fleeting at best, phoney at worst. It was not sustainable. It was paid for with borrowed money and high taxes. The loans came due, but the economy was anaemic from over-taxation. That was the shape Nova Scotia was in when this government came to office.

Today, our economic growth is driven by increased productivity in the private sector. Government's role is to create conditions that encourage private-sector growth and new jobs. And, that is happening. The measured economic growth of the past year will continue in 1996, at an annual pace of about 1.3 per cent. However, as the year proceeds, substantial new investment in large construction projects will accelerate, fuelling more robust growth into 1997 and 1998. These positive developments include construction on Highway No. 104 and a major expansion at Stora Forest Industries.

In the spring of 1997, Nova Scotia's economy will begin to feel a new surge of vitality, as the largest single tax cut in this province's history takes effect. Blending the provincial sales tax and the federal Goods and Services Tax into a single, lower tax on consumption is positive tax reform. But it is much more than that. It is a massive tax reduction and a massive boost to our economy.

It is estimated by all three provincial governments that are blending their sales tax with the GST, that it will increase economic output in each province by at least 0.5 per cent. Business costs will drop and investment will rise. In Nova Scotia, 3,000 new permanent jobs will be created. The hidden sales tax that was embedded in every product and service will be gone, making those goods and services less expensive for Nova Scotians, and more attractive to the rest of the world. That is real tax reform. That, Mr. Speaker, is real job creation.

III. FINANCIAL PERFORMANCE--1995-96

The government's priority upon assuming office in 1993 was not one of our own choosing. It was thrust upon us. Fiscal recovery was the pressing necessity. The expenditures of government had to be put in line with its revenues. On the revenue side, we were a province dependent on shrinking federal transfers. So the government had to look to its spending as the only way to achieve the essential budgetary balance. Today, just more than two years into our four-year Expenditure Control Plan, we will post that balanced budget. Mr. Speaker, this did not happen by accident, and it could not happen without sacrifice. But surely no right-thinking Nova Scotian will argue that it was not necessary, for we were a province in danger of drowning in a sea of our own debt.

The spending reductions we made were carefully designed to protect Nova Scotians most in need, and to ensure continued and enhanced quality of service in vital programming. Look at the facts. In 1993, 76 per cent of the province's program spending was devoted to health, education, and social services. Today, 79.3 per cent of program spending is in those

[Page 1040]

three areas of service to Nova Scotians. Look back even further to gain a broader historical perspective. In 1980, health spending accounted for 22 per cent of the provincial budget. Today it accounts for 28 per cent. In 1980, debt charges consumed only 8 per cent of the total provincial budget; today they consume 21 per cent. Therein lies the problem. It is not a problem of this government's making, but we have had, and will continue to have, the will to address it.

Mr. Speaker, there have been structural and operational changes to the Government of Nova Scotia. Those changes have helped bring spending and income into balance which, in turn, has secured the future of vital public programs and services.

When this government reduced its costs we did it with the public interest, not the provincial ledger, foremost in our minds. We reduced the size of the Civil Service, not through widespread layoffs, but through a generous early retirement offer which has been accepted by more than 3,000 public employees -- some 90 per cent of those eligible.

[2:15 p.m.]

We did it in our education system by taking money out of the boardrooms and spending it in the classrooms, where it benefits young Nova Scotians. We did it by cutting overall government spending by 12 per cent while increasing social services spending by 13 per cent. And we are doing it in health care, by maintaining and enhancing access to clinical programs in every region of Nova Scotia; by increasing funding for long-term care, home care, and emergency health services; by maintaining spending levels for mental health; and through a labour adjustment plan that offers fair treatment and retraining to workers leaving hospitals.

Mr. Speaker, bold action was required in this province, and this government rose to that challenge. Fundamental change is never easy. What is easy, is sitting on the sidelines and criticizing, while preying on the fears of those who face uncertainty. This government will not be deterred in its efforts to effect positive change by the relentless negativity of opportunistic second-guessers.

Now, Mr. Speaker, permit me to turn to the most recent successes of the government's plan for fiscal recovery. When the 1995-96 fiscal year began, we estimated a current account deficit of $28.1 million. As the year progressed, higher-than-expected revenues from provincial and federal sources caused us to improve on that estimate in each of our regular financial updates. Additional spending pressures since January -- most notably in health programs and to support victims of past abuse in provincial institutions -- have driven program expenditures higher. Despite this additional spending, I can report today that the province will record a current account surplus of $17.6 million for the 1995-96 fiscal year. This represents the province's first balanced operating account in more than 15 years. We have improved on our original estimate by $45.7 million, and improved on last year's performance by some $102 million. Aggressive debt management, combined with favourable interest and foreign currency levels, accounts for a significant share of this improvement. Debt-servicing costs for the fiscal year just ended will be $45 million less than estimated at the beginning of the year.

Mr. Speaker, in 1992-93 Nova Scotia posted a record budgetary deficit -- operating and capital -- of $617 million. In 1995-96 the figure was $181 million. In just three years, $436 million was carved off the deficit of this province. This year we will eliminate the budget deficit entirely. In fiscal 1996-97, the government is bringing down a fully balanced budget. Indeed, we are estimating a $2.8 million budget surplus. We are finally in a position to reverse

[Page 1041]

the debilitating cycle of deficits, to begin to pay down the debt, and to reduce the debt servicing costs that rob Nova Scotians of almost 1 billion tax dollars a year.

IV. MOVING FORWARD IN 1996-97

1996-97 marks the first time in a generation that a government in this province will achieve a balanced budget on combined operating and capital spending. The province does not need to borrow to pay for its operations or construction projects.

Revenues from provincial sources are expected to show solid growth in 1996-97. Steady improvement in consumer confidence will boost consumption tax revenue and push our provincial, own-source revenues 2.8 per cent above last year's total.

Federal transfers to the province are entering a new phase in 1996-97. The introduction of the Canada Health and Social Transfer (CHST) marks a significant departure from traditional federal-provincial cost-sharing arrangements. Social welfare costs will no longer be subject to open-ended cost-sharing with Ottawa. Under the new Canada Health and Social Transfer system, the federal government will provide a block fund to support health care, post-secondary education, and social welfare in all provinces. The total value of this national block fund will be $3.5 billion less than the combined level of transfers last year. In Nova Scotia's case that means we will lose more than $100 million this year alone. Further reductions in the CHST will continue. In 1997-98 and over the ensuing five years, Nova Scotia's share of the CHST pot will decline as per capita funding arrangement among provinces is phased in.

Other areas of federal funding have also been capped or reduced. Mr. Speaker, the writing is on the wall. This province cannot look to Ottawa to solve its fiscal or its economic problems. The combined effect of federal restraint measures, announced in recent budgets, will result in cumulative losses to the province estimated to reach $2.5 billion by the year 2000.

V. KEEPING SPENDING IN CHECK

Clearly, the province must keep a firm grip on its spending in order to maintain fiscal stability. Fortunately, we can approach that task from the relative security of a balanced budget. We are not nearly so vulnerable as we were just a few years ago. With fundamental reform well under way in all major areas of public spending, the government can now restore flexibility to the budgetary process.

The program spending reductions imposed by the Expenditure Control Plan will be lifted and replaced with new legislation that focuses on government's bottom line. The repeal of expenditure controls, two years ahead of schedule, is possible only because of the success of the program itself. Through strict adherence to expenditure controls, the government was able to apply its revenue and debt-servicing gains directly to deficit reduction. The results are evident in the balanced budget we have before us today. Now we can restore government's ability to direct more of the taxpayers' dollars to the priorities set by the people of Nova Scotia. We will be introducing legislation that reflects the principles and actions proposed by government in the White Paper, Shaping the Future. Those proposals have been endorsed by Nova Scotians.

[Page 1042]

A balanced budget is a major accomplishment for Nova Scotia, and a significant step toward a solid financial future. But our province must still address the legacy of more than 20 years of irresponsible spending and ever-larger deficits. That legacy is a debt of more than $8.5 billion. That is roughly $9,100 for every man, woman, and child in Nova Scotia. Interest and other debt charges cost the taxpayers of this province almost $1 billion a year. Mr. Speaker, that's more than we spend to educate Nova Scotia's children.

The legislated plan for long-term financial stability will have at its core, three goals:

1. To ensure no government, present or future, takes Nova Scotia back to the brink of financial ruin;

2. To expand and enhance those vital services Nova Scotians care about, but to do so responsibly -- as we can afford to;

3. To begin paying down debt so we can start to recapture the $1 billion we lose each year to debt payments.

The new legislated program of fiscal stability and accountability will limit the growth of program expenditures to growth in revenues. Government will have to live within its means.

The new law will limit additional appropriations. Total expenditures in any given year will not exceed the spending approved by this House by more than 1 per cent.

The legislation will require that, in the event a deficit is incurred, that deficit must be recovered within two fiscal years. Budgetary surpluses will be used to pay down debt or reduce Nova Scotians' taxes.

Mr. Speaker, we've hit one milestone on the road to recovery -- a balanced budget. Now it's time to take aim at a higher target. Now it's time to put Nova Scotia's future on solid ground. That is the only way to secure health care, education, and other vital services for today and tomorrow. That is the only way to lower taxes and give Nova Scotians the competitive advantages we need to prosper and create jobs. This legislation will help achieve those ends.

VI. BUILDING NOVA SCOTIA'S COMPETITIVE ADVANTAGE

Mr. Speaker, the government's role in the economy has changed, by necessity and by choice. For 20 years governments in this province threw money at economic problems. The only lasting legacy of those efforts is a huge debt and high taxes. Today, the government realizes that it can make a more positive contribution to the economic well-being of Nova Scotia, by reducing the burdens it places on economic initiative.

Reducing taxes is the greatest single contribution the government can make to Nova Scotia's economy. But it isn't the only contribution, because taxes aren't the only burden government places on business. Governments like to regulate. The problem is, regulations are regularly enacted, but rarely rescinded. Over the years, as new regulations were stacked on old, a complicated and confusing system was created.

[Page 1043]

This year the government took two important steps toward eliminating the confusion and streamlining the vast array of regulations. We created a single department that will conduct the lion's share of transactions between government and business, and we embarked on a major deregulation effort.

The Department of Business and Consumer Services is a single, open door to government. It combines nine agencies that are responsible for more than 90 per cent of the transactions between the Nova Scotia business community and the province. Soon, businesses will be able to do all their transactions with the government at a single access point, at service centres around the province, or, when the technology is in place, through on-line computer or telephone links. The dollars and time lost in dealing with the province will be dramatically reduced.

The new Department of Business and Consumer Services, in partnership with the Economic Renewal Agency, will spearhead a monumental government effort to review every regulation the province imposes. The objective is to eliminate, combine, refine and streamline. Mr. Speaker, making it easier to do business in Nova Scotia, will help businesses grow and will create jobs.

Another redesign initiative that will pay off in increased economic activity is the merger of the former departments of Transportation and Communications, and Supply and Services. The merger concentrates virtually all of government's capital spending in one department. That department has lead responsibility for building new public-private partnerships. We will use our capital budget to lever private investment. The result will be more direct investment in the economy of the province, more construction activity, and more jobs for Nova Scotians.

The efforts of the past two years are paying dividends right across government. The examples of better service and increased efficiency are everywhere. Many of those examples can be found on the pages of Government By Design, which for the third consecutive year provides a detailed view of the government's actions, plans, and goals. I am pleased to table Government By Design, 1996-97, Building on Solid Ground.

[2:30 p.m.]

The conditions for growth:

Mr. Speaker, the first order of business for any government determined to create conditions that foster investment and growth, is to put its own finances in order. We are doing that. The next step is to provide business and industry with the competitive advantages they need to compete in the world, so they can grow and create jobs for Nova Scotians.

In 1995, Nova Scotia businesses competed as never before. The value of exports from the province grew by 14.5 per cent last year. That is a trend the government will continue to promote. When we export our products, our services, and our know-how, we create new wealth here at home.

The Premier has led trade missions and the government aggressively markets Nova Scotia around the world. Potential customers need to be told what we have to offer. And, what we have to offer must be competitively priced. Local, provincial and federal taxes all add to the cost of our goods and services, and hamper the competitive position of our businesses and industries. In the past two years, the Nova Scotia Government has targeted tax relief to strategic sectors of our economy and offered an equity tax credit that makes investing here more attractive. Last year alone, 32 equity tax credit applications were approved. This year we will build on that initiative.

Incentives for investing in Nova Scotia:

Community-based economic development holds the key to future prosperity. Securing capital has always been the biggest obstacle to community-based ventures. Today, we are announcing initiatives that will help bring Nova Scotians with ideas and know-how together with the capital they need to make good [Page 1044]

things happen. To attract investment to community-based economic initiatives, we are expanding and enriching our equity tax credit program. Mr. Speaker, the improvements I am announcing today, will place eligible Nova Scotian enterprises among the most attractive opportunities for investment, in the country.

Nova Scotia already offers a 30 per cent tax credit for equity investment in Nova Scotia companies. This year we are greatly enhancing that tax advantage, by offering a 20 per cent guarantee on investments in qualifying community economic development (CED) corporations and cooperatives. Through the combined effect of these measures, the province is sharing the risk 50/50 with investors. To target this investment incentive to communities most in need, the guarantee will apply outside urban Halifax, Dartmouth, Bedford, and Sackville.

The province is seeking agreement from the federal government for RRSP contributions to be eligible for investment in community economic development initiatives. As we achieve that agreement, the pool of available capital will expand significantly. In addition, we are expanding the allowable investments of CEDs to include a broader range of businesses, and we will be introducing legislation to simplify the rules applied by the Securities Commission.

Mr. Speaker, the combined force of these investment incentives will open the door to a new source of capital for community-based enterprise. Communities across our province will have the tools they need to raise funds for good ideas. Good ideas, backed by the capital needed to get them off the ground, add up to new jobs for Nova Scotians.

Tax cuts for individuals:

The best economic idea any government can have, Mr. Speaker, is to put more money in the hands of the people. To do that, the government has to take less. Two years ago this government moved from single-year to four-year fiscal planning. At the same time we put in place an economic and fiscal plan with the objective of lowering taxes on Nova Scotians. Today, Mr. Speaker, we can announce that in 1997 Nova Scotia will be in a position to reduce the personal income tax rate of every taxpayer by 3.4 per cent. That is a two point reduction in Nova Scotia personal income taxes from 59.5 per cent of the federal rate to 57.5 per cent. Nova Scotia will have the lowest income taxes east of Alberta. This broad tax reduction, effective July 1, 1997, is a tangible benefit of sound financial management. This is an historic measure, Mr. Speaker, in that it represents the first-ever rate decrease in personal income taxes in Nova Scotian history.

Mr. Speaker, last year this government provided some $13 million in tax relief to 155,000 low-income Nova Scotians and their families. Along with the income tax rate decrease, the Low-Income Tax Credit Program will be enriched in the upcoming year. The value of the low-income tax reduction will increase from $200 to $300 for adults and from $105 to $165 for each dependent child. A family of four with a net family income of $15,000 will receive a tax break of $930. The low-income tax reduction is gradually phased-out as

[Page 1045]

income increases above $15,000. Next year, an additional 65,000 Nova Scotians will qualify for this tax cut, and families with incomes of $15,000 and less will see their taxes reduced by nearly two-thirds. The total value of this tax reduction to low-income Nova Scotians will reach $25 million in the 1997 taxation year.

Help for the least advantaged:

Other low-income Nova Scotians, Mr. Speaker, do not benefit from tax relief simply because they do not pay taxes. This government has recognized its responsibility to these Nova Scotians. The budget of the Department of Community Services has increased over the last three years, during a time when all other expenditures of government were declining.

The government is determined that the least advantaged Nova Scotians will not be forgotten as our fiscal picture, and our ability to respond to real human need, improves. Beginning in 1997, we have budgeted an additional $8 million for Nova Scotians most in need. The Department of Finance will work with our colleagues in the Department of Community Services and consult with other Nova Scotians to determine the most effective way to get this additional money in the hands of Nova Scotians who need it most.

More tax relief:

Mr. Speaker, even while it provides additional assistance to low-income Nova Scotians, this government never loses sight of the maxim that a job is the best social program. The expansion and enhancement of our equity tax credit, and the blending of the two sales taxes into one will dramatically increase job prospects in Nova Scotia. A number of other tax initiatives will be implemented this year to build on the growing competitive advantages of doing business in Nova Scotia.

Currently, machinery and equipment are included in business assessments for municipal property tax purposes. That burden on business was to be phased out over 10 years. To assist capital-intensive industry in becoming more competitive, the phase-out process will be accelerated. Machinery and equipment will be eliminated from the property tax base within 3 years instead of the original 10. Mr. Speaker, I am quick to point out, the province will bear the cost of this accelerated timetable by compensating municipalities for the revenue loss.

Many smaller firms are not in a taxable position in their early years and are therefore not able to take advantage of Nova Scotia's corporate income tax credit that reduces the cost of filing a prospectus. To assist these firms, we will be implementing a seven-year carry-forward provision on this credit.

To assist first-time home buyers, and as an incentive to new home construction, the province will extend its New Homeowners' Incentive Rebate Program until March 31, 1997. This program provides a rebate of up to $3,000 for provincial sales tax on building materials.

New environmental standards for businesses will help protect Nova Scotia's natural heritage. To help Nova Scotia businesses become certified to ISO 14000 standards, the province will provide a 25 per cent corporate income tax credit on related costs, up to a maximum of $150,000.

To encourage the use of more environmentally friendly alternative fuels, the tax rate on propane fuel will be lowered from the current 13.5 cents per litre to 7 cents per litre effective at midnight tonight.

[Page 1046]

Mr. Speaker, where possible, it is important to ensure that equity raised in Nova Scotia is invested effectively in the province. Currently, the province offers a 20 per cent tax credit to individuals investing in a Labour-Sponsored Venture Capital Fund. To date in Nova Scotia, over $18 million has been raised for such funds. To ensure that equity does not merely accumulate and is applied to investments within the province, we will be adjusting our legislation to mirror recent changes in federal rules regarding Labour-Sponsored Venture Capital Corporations.

The Labour-Sponsored Venture Capital tax credit for investing in these corporations will be reduced from 20 per cent to 15 per cent on a maximum share purchase of $3,500. The holding period for shares in provincially registered LSVC corporations will be increased from four years to eight years on shares acquired after today.

VII. SIMPLIFYING THE SALES TAX SYSTEM

Mr. Speaker, since the imposition of the national Goods and Services Tax in 1991, Nova Scotians, like most Canadians, have struggled with two levels of sales tax. The confusing system of tax stacked on tax is a burden for consumers and businesses alike. Earlier this week, Nova Scotia was one of three Atlantic Provinces to announce it has reached a Memorandum of Understanding with the federal government that will see these two taxes blended into one. Nova Scotia will be reducing its sales tax from an effective rate of 11.8 per cent to just 8 per cent. That amounts to a provincial tax cut of $120 million -- without question the biggest tax cut, I might emphasize, in Nova Scotian history.

Nova Scotians will benefit directly from this measure by paying less sales tax on many items. Consumers will also benefit from lower prices, as the reduction in the cost to business flows through to the retail price. After all, Mr. Speaker, a tax on business is a tax on consumers.

This measure removes sales tax from business inputs. Once it comes into force on April 1, 1997, businesses making taxable supplies in this province will be rebated for 100 per cent of the taxes they pay on the goods and services they use. This Input Tax Credit will improve our competitive position in the international market place. Exports now account for 15.5 per cent of our economic output, and that number is growing rapidly. That growth will accelerate in the new tax climate, bringing new wealth and new jobs to Nova Scotians. Nova Scotians will benefit again, from increased economic activity and more job opportunities, as businesses reinvest their tax savings and increase production to meet growing demand.

[2:45 p.m.]

Mr. Speaker, the province could not contemplate a tax reduction of this magnitude without offsetting measures. As part of the package, the federal government will provide Nova Scotia with $249 million in adjustment assistance over four years. Even that level of assistance will not nearly cover the province's revenue loss. To help ease the transition, the province will phase-in the tax reduction on the lease and purchase of new cars, trucks and heavy equipment. Currently they are taxed at the combined GST/PST rate of 18.8 per cent. On April 1, 1997, the day the blended tax comes into effect, the tax on these vehicles will be reduced from 18.8 per cent to 17 per cent, a year later to 16 per cent, and finally, by year three, it will be reduced to the blended sales tax rate of 15 per cent. This measure will not only ease provincial revenue losses, it will cushion the automobile dealers from a buying lull that would have preceded harmonization if the rate were to fall from 18.8 to 15 per cent overnight.

To help make harmonization financially feasible over the longer term, the province must recapture some of the tax savings gained by our largest and wealthiest businesses. Effective April 1, 1997, the province will introduce a corporate capital tax of 0.25 percentage points on financial capital. This tax will not apply to businesses with less than $5 million in financial capital, and will be phased in for businesses with financial capital of between $5 million and $10 million. Its full impact will be felt only by firms with capital in excess [Page 1047]

of $10 million. About 1,000 businesses will pay the full Corporate Capital Tax. It is expected the province will raise $45 million in revenue annually from this measure.

VIII. CONCLUSION

Mr. Speaker, Nova Scotians are now learning about the complete package of tax relief. It is the government's responsibility to ensure that the tax system treats every Nova Scotian and all segments of our economy fairly. The package of tax reform we have outlined today, both sales and personal, achieves that objective.

In a year's time, following discussions with Nova Scotians from all sectors of our economy, a single, blended sales tax will be put in place. Those discussions will centre around how to maximize our economic and collective financial benefits. We will listen to Nova Scotians' concerns and try to address those concerns in the agreement we sign with the federal government.

We will be asking Nova Scotians how best we can assist those on low and fixed incomes and ensure they too benefit from this fundamental change in our tax system. But this government's package of tax relief only begins with the blended sales tax. Our program of tax reductions also includes a personal income tax cut for every taxpayer; additional tax relief for low-income Nova Scotians; and major tax incentives for those who invest in our province. The wealthiest companies in Nova Scotia are being asked to make an additional contribution to their province. That, Mr. Speaker, is fair.

Mr. Speaker, we can cut taxes only because we put our financial house in order. Now that Nova Scotia is on solid ground, it is time to start building; building a more competitive economy; building secure public services; building on the new opportunities offered in our changing world; building hope for those who have lost hope; and building a better future for every Nova Scotian.

Thank you, Mr. Speaker. (Prolonged Applause)

MR. SPEAKER: The honourable member for Hants West.

MR. RONALD RUSSELL: Mr. Speaker, this is a different budget in many ways. (Applause) I will tell you why in a minute. Well, I appreciate that and when I tell you why, I hope you applaud just as vigorously.

Mr. Speaker, this is the first harmonized budget we have ever had in the history of Canada. We have a budget here for fiscal 1996-97 and another one for 1997-98. You might well ask, why do we have two budgets compressed into one document? Well, I will tell you why. Because the year of 1995-96 and 1996-97 haven't been great years for the people of this province. However, the government that came to power promising no new taxes in 1993 and promptly implemented new taxes three months later, the same Minister of Finance is now standing in his place and saying, look folks, last year was tough, this year is going to be tough but next year, Nirvana. We are going to slash taxes right across this province. We are going

[Page 1048]

to create thousands of jobs and the sun is going to shine. (Applause) This is all going to be accomplished because our Minister of Finance got with his buddy up in Ottawa and they decided to solve a couple of problems.

The federal minister, Mr. Speaker, as you well know, made a promise when he came to power in 1993 that he was going to abolish the GST. Now, he has got a real problem because he is having to kick members out of his own Party because he is not living up to that promise. This minister has a problem because they came to power promising the creation of 58,000 jobs because there were 58,000 unemployed in 1993. They came to power with jobs, jobs, jobs. Today, there are 62,000 unemployed in the Province of Nova Scotia. The number hasn't decreased, it has increased by 4,000. You go to Ottawa and what's happened to the GST? It is still there.

So these two got together and they came up and they decided on a harmonization of the GST with the provincial sales tax and, hopefully, according to them, this is going to produce all kinds of wonderful things not only for this province but for Canada.

Mr. Speaker, on Page 1 of the Budget Address, we are told about what this budget does not contain. Well, I would like to enlighten the minister on some other things that it does not contain other than those which he has enumerated.

First of all, it does not contain any measures that are going to restore consumer confidence. It is not going to restore business confidence in this province and that is what we are going to have to do, Mr. Speaker, if we are going to produce jobs for Nova Scotians. Nova Scotians are not prepared to wait until 1997 for these guys to come back into this House and start writing another budget that will come up with these promises that they have made in this particular budget. It is all airy-fairy stuff. There is nothing in here, that I can see, that is worthy of this government.

Mr. Speaker, we are told in this budget that when this government reduced its costs, it did it with the public interest, not the provincial ledger, foremost in their minds. Well, I hope they tell that to the sick in this province. I hope they tell it to those who are in school in this province and I hope they tell it to the seniors of this province, who have suffered because the Minister of Finance has dictated to each of the departments how much money they can have and what cuts they are going to have to make, at great expense to the people of Nova Scotia.

Mr. Speaker, it was bad in 1995-96. We look at the budget estimates this morning and we find that there is a $31 million reduction in the hospital insurance program. That is the program that covers hospitals. I am wondering about my own hospital in the Town of Windsor. Is it going to survive, when it was just surviving last year, and now they are chopping another $31 million out of the hospital budget?

There are cutbacks, Mr. Speaker, in the Pharmacare Program, cut back from $46 million in the past fiscal year to $38 million in this fiscal year. What is that going to mean to the premiums that are paid by seniors? Obviously, they are going to have to pay more.

Mr. Speaker, the Minister of Finance dwelt at some lengths, during his Budget Address, about the fine job that he did last year in coming forward with a budget that predicted a current account deficit last year of $28.1 million, but coming in with a $2.8 million surplus. He said we did that by good fiscal management. Well, let me tell you what good fiscal management is to the Minister of Finance. (Interruptions) If you listen you might learn something. (Interruptions) In 1995 . . .

MR. SPEAKER: Order, please. Order.

MR. RUSSELL: In 1995-96, Mr. Speaker, the Minister of Finance of the Government of the Province of Nova Scotia picked up an additional $46 million in equalization payments that had not been budgeted for, capital. Keep a note of that, folks, $46 million. They picked up $51 million in prior year [Page 1049]

adjustments which they had not budgeted for. Now, this was all manna from the federal government. It just came strolling down into the minister's coffers. On top of that, he saved a further $45 million on servicing the debt because of the lower interest charges. When you add all that up, the Minister of Finance received, last year, $142 million that he had not budgeted for in last year's budget.

Now, what did he do? He took a deficit of $28.1 million and he transformed that into a surplus of $2.8 million. So, therefore, $30 million of this $142 million went into the budget to make the budget come out with a surplus for this year. But he received $142 million additional, so there is approximately $110 million still not accounted for.

[3:00 p.m.]

Well, just think about this for a moment. The other day in the House we were talking about putting $32 million into the Victims of Abuse Fund. We were arguing in this House about where was that money coming from. Well, I will tell you where it was coming from, it was coming from part of this $142 million. When is it going to be spent? It is going to be spent this fiscal year. So in point of fact what the minister has done has reduced his expenditures in 1996-97 by that $32 million by taking it from the unforecasted money that he received. (Interruption)

Lucky money, you are right. He also picked up $23 million for restructuring. Now did he spend that in 1995-96? No, he put that into a fund and brought it forward to 1996-97. So we have $23 million of restructuring to be paid for this year which is not included in this year's budget. That is a very clever move, Mr. Speaker.

Now, Mr. Speaker, that accounts for only some of the money. However, if you go back into the Budget Address, back to about Page A3, you will find that the minister forecast - I will have to hold my glasses up because they just came apart on me - $898 million in personal income tax but he received only $881 million. Corporate income tax, he forecast $110 million but he received only $99 million.

Now what does this tell you, Mr. Speaker? The minister made an estimate, the minister now has a forecasted figure which will probably translate into the actual figure for this year or very close to it. It shows that the Province of Nova Scotia performed less well than what even the Minister of Finance had forecast for last year. So why are we going to believe him that this year is going to be so much better, or next year is going to be simply great?

He has no credibility, Mr. Speaker. (Interruption) In fact, that minister is forecasting a growth rate this year of 1.3 per cent. Now, I don't know where that figure came from. However, I do know that, I think it was the Bank of Montreal, put out a forecast just the other day which said we would be lucky to make 1 per cent. So as I say, I don't know where he got that figure.

Another deficit or another budget subject, Mr. Speaker, that I think is worthwhile looking at and we will be looking at it a great deal when we get into the estimates was the Gaming Corporation. The estimate was $132 million into the coffers of the Finance

[Page 1050]

Department last year and we ended up with $121 million; in other words, an $11 million shortfall in the profits from the Gaming Corporation.

You add all these things up, Mr. Speaker, and you say, my God, it is lucky Bernie again because if, indeed, it wasn't for the fact that our economy was doing so badly and we received extra equalization money, if it wasn't for the fact that our economy did so poorly the year before and we received additional prior years adjustments and if it wasn't for the fact that interest rates went down, he would not have balanced his budget this year. In fact, his estimate of whatever it was, $20 million and some odd, would have been out by perhaps as much as $50 million to $60 million. So I don't put too much credence in the forecasts of this minister.

Now, Mr. Speaker, you might wonder why the minister has chosen to come forward with a two year budget. Well, I said that one of the reasons obviously is that this year is very dismal and perhaps in looking at a budget that he has not yet written, he can put some goodies in this budget that, hopefully, he would include in his next budget. I don't think that minister will ever make another budget, to be quite honest. There is going to be an election because this is the Liberal Party platform for the election, whenever it comes along.

I can see the Minister of Finance, the Premier and all the rest of those persons on the other side, Mr. Speaker, walking down Main Street with a copy of this in their hand and saying, isn't it great, we have cut income taxes, we have cut this, we have cut that, because it is in this book, which is an official government document; that is even better than a platform document. But the truth of the matter is, the public can put as much credence in this document as they could in the famous, or infamous Liberal Red Book. It is not worth the paper it is written on. It is full of promises that may or may not - and I tend to think may not - come to pass. (Interruptions) No, we are very fortunate to be here at the present time because we are going to throw you guys out.

Mr. Speaker, I will continue my speech tomorrow and then we will be starting into estimates and getting into individual departments sometime next week, so at this time I would adjourn the debate on the Budget Address.

MR. SPEAKER: Very well, the debate stands adjourned.

We will now move to the daily routine.

PRESENTING AND READING PETITIONS

PRESENTING REPORTS OF COMMITTEES

TABLING REPORTS, REGULATIONS AND OTHER PAPERS

STATEMENTS BY MINISTERS

GOVERNMENT NOTICES OF MOTION

[Page 1051]

MR. SPEAKER: The honourable Minister of Natural Resources.

RESOLUTION NO. 334

HON. ELEANOR NORRIE: Mr. Speaker, I hereby give notice that on a future day I shall move the adoption of the following resolution:

Whereas April 25th is Take Our Daughters to Work Day when many parents, employers and schools are cooperating in encouraging girls to spend the day at work with a parent or other interested adult; and

Whereas Take Our Daughters to Work Day represents a great opportunity to acquaint girls with a wide range of career options open to them, many of which were not open to women in the past; and

Whereas this day is a great opportunity for boys to come to a greater understanding of the obstacles faced by girls and women and to understand the idea of gender roles in society can be confining for both men and women; and

Whereas Take Our Daughters to Work Day is an opportunity for girls, boys, parents, educators and the business community to envision a future where it will no longer be unusual to see women in trades and technical work, leading corporations or in elected office;

Therefore be it resolved that this House recognize and support the efforts of schools, parents and employers in helping girls and boys to a more equal future in the work place in the world.

Mr. Speaker, I ask for waiver of notice.

MR. SPEAKER: Is that agreeable to the House?

It is agreed.

Would all those in favour of the motion please say Aye. Contrary minded, Nay.

The motion is carried. (Applause)

The honourable Minister of Natural Resources.

HON. ELEANOR NORRIE: Mr. Speaker, in light of the previous resolution, I would like to take the opportunity to recognize some young daughters, who are in your gallery and in the east gallery, who are attending government offices today and caucus offices on Take Our Daughters to Work Day.

In the east gallery, from the Truro area, I would like to introduce Amanda MacMeekin and Nicole Newcombe, who are attending today to watch the proceedings and see the historic day when the budget is presented in the House. I would ask everyone to join me in welcoming them. (Applause)

MR. SPEAKER: I didn't call for introductions of guests, but I understand there are some introductions.

[Page 1052]

The honourable member for Sackville-Cobequid.

MR. JOHN HOLM: Mr. Speaker, in light of the introduction and in keeping with the introduction that the minister just made, I would like to introduce a very special young lady who is sitting in the west gallery, Miss Kayleigh Butler, who has come with her father to work today. Her father works in the NDP caucus office and Kayleigh has been a big help in the office this afternoon and I would like to ask her to stand and also receive the very warm welcome of the members. (Applause)

MR. SPEAKER: The honourable member for Cole Harbour-Eastern Passage.

MR. DENNIS RICHARDS: Mr. Speaker, I, too, want to join other members in welcoming special people today, especially today, because not only do we recognize this special day of bringing our daughters to work, but a day that young people can now see a future for Nova Scotia and I think that speaks well. I want to introduce a young lady that is very special to me, my own daughter, Jennifer. She is sitting over in the east gallery and I would ask her to stand and be recognized by the House. (Applause)

MR. SPEAKER: The honourable member for Colchester-Musquodoboit Valley.

MR. BROOKE TAYLOR: Mr. Speaker, through you to all members of the House I would like to introduce a Halifax Regional Municipality Councillor, representing the new super-city, Mr. David Hendsbee. I wonder if my colleagues would give Mr. Hendsbee a warm round of applause. (Applause)

MR. SPEAKER: The honourable Minister of Natural Resources.

RESOLUTION NO. 335

HON. ELEANOR NORRIE: Mr. Speaker, I hereby give notice that on a future day I shall move the adoption of the following resolution:

Whereas April 26th marks the anniversary of the day in 1918 when Nova Scotian women received the right to vote in provincial elections; and

Whereas May 24th marks the anniversary of the day in 1918 when Canada gave women the right to vote in federal elections; and

Whereas this year will be the 78th Anniversary of these important gains in the rights of 51 per cent of Nova Scotia's population; and

Whereas the right of all citizens to full participation in the political process is one of the hallmarks of a democratic society;

Therefore be it resolved that this House recognize these anniversaries of important milestones for Nova Scotian women, and further that those of us in political life encourage the women of our province to participate in the electoral process as candidates, as well as voters, so that the future sessions of this House will show representation of women which reflects their representation in the population.

Mr. Speaker, I ask for waiver of notice.

[Page 1053]

MR. SPEAKER: Is that agreeable to the House?

It is agreed.

Would all those in favour of the motion please say Aye. Contrary minded, Nay.

The motion is carried, unanimously.

INTRODUCTION OF BILLS

NOTICES OF MOTION

MR. SPEAKER: The honourable Leader of the Opposition.

RESOLUTION NO. 336

DR. JOHN HAMM: Mr. Speaker, I hereby give notice that on a future day I shall move the adoption of the following resolution:

Whereas five days before the 1996 fiscal year ended the Liberal Government appropriated an additional $98 million to apply to the 1995-96 budget year; and

Whereas $32 million of this additional appropriation was to provide for compensation to victims of institutional abuse; and

Whereas on March 8, 1996, the Premier himself ordered that compensation for Debra Stevens and her family be settled and settled immediately;

Therefore be it resolved that this Liberal Government be condemned for pulling the plug on negotiations with Debra Stevens and her sons, stalling once again the matter of compensation, and that they abandon any pretence that the necessity for an additional $32 million was for a quick and speedy resolution to compensation for victims of abuse.

MR. SPEAKER: The notice is tabled.

The honourable Leader of the New Democratic Party.

RESOLUTION NO. 337

MR. ROBERT CHISHOLM: Mr. Speaker, I hereby give notice that on a future day I shall move the adoption of the following resolution:

Whereas the Liberal Government has firmly embraced the aptly named blended sales tax, or BST; and

Whereas the Tory Opposition supported this harmonization when they were in government; and

Whereas only the New Democratic Party has consistently reflected the public's deep opposition to this unfair and regressive tax in this House;

[Page 1054]

Therefore be it resolved that if this government does not have the courage to put the BST before the public in a general election, then this House establish a special committee to travel from one end of this province to the other so that the overwhelming public opposition to this tax will be given a greater voice.

MR. SPEAKER: The notice is tabled.

The honourable member for Kings North.

RESOLUTION NO. 338

MR. GEORGE ARCHIBALD: Mr. Speaker, I hereby give notice that on a future day I shall move the adoption of the following resolution:

Whereas Page 178 of Hansard for February 27, 1990, shows that the member for Halifax Needham, presently the Minister of the Technology and Science Secretariat, was concerned that, ". . . implementation of the GST will substantially increase costs to municipal governments . . ."; and

Whereas the honourable member for Halifax Needham called on the government of the day to, ". . . strongly oppose the implementation of the GST on municipal governments . . ."; and

Whereas this same member for Halifax Needham is now a Cabinet Minister in the Liberal Government which is extending the PST to municipalities, thereby increasing their costs enormously;

Therefore be it resolved that the honourable member for Halifax Needham show that he is as good as his word and stand up against the imposition of the PST/GST to municipal governments.

[3:15 p.m.]

MR. SPEAKER: The notice is tabled.

The honourable member for Lunenburg.

RESOLUTION NO. 339

MRS. LILA O'CONNOR: Mr. Speaker, I hereby give notice that on a future day I shall move the adoption of the following resolution:

Whereas today is Take Our Daughters to Work Day, to provide encouragement and support needed to remove the barriers limiting career opportunities available to women today; and

Whereas the Liberal caucus office is proud to host six young women: Katie Marks from Bel Ayr; Meaghan Cole from Col. John Stewart; and Kelly Gray from J.L. Ilsley High School; and

Attendu que trois des six jeunes femmes: Frédérique Jamieson, Renata Militzer et Julie Thibodeau fréquentent l'École du Carrefour;

[Page 1055]

Therefore be it resolved that this House commend the employers, parents and schools across the province for participating in this worthwhile program, applaud the Government of Nova Scotia for supporting the Take Our Daughters to Work Day and extend best wishes to these young women in their future career choices.

Mr. Speaker, I would like to ask the four young ladies up in your gallery to rise and receive the warm applause of the House. One young lady is one of the daughters of our researcher. (Applause)

MR. SPEAKER: Do you wish to seek waiver of notice from the House?

MRS. O'CONNOR: Oh, yes.

MR. SPEAKER: Is that agreeable to the House?

It is agreed.

Would all those in favour of the motion please say Aye. Contrary minded, Nay.

The motion is carried.

The honourable member for Cape Breton South.

RESOLUTION NO. 340

MR. MANNING MACDONALD: Mr. Speaker, I hereby give notice that on a future day I shall move the adoption of the following resolution:

Whereas this Friday and Saturday, Liberals from all over Nova Scotia will gather at Sydney's Centre 200 for their annual meeting; and

Whereas this year's meeting will be a significant economic boost of some $250,000 for one of Nova Scotia's great convention destinations; and

Whereas the Liberal Party's annual meeting is a chance for ordinary Liberals, federal and provincial caucus members, and the Premier to better understand the many challenges facing the Cape Breton economy;

Therefore be it resolved that the members of this House applaud the Liberal Party for holding their annual meeting in Sydney at Centre 200 this weekend as an expression of confidence in the good people of metropolitan Cape Breton.

I ask for waiver, Mr. Speaker.

MR. SPEAKER: Is that agreeable to the House?

It is agreed.

Would all those in favour of the motion please say Aye. Contrary minded, Nay.

The motion is carried, unanimously.

[Page 1056]

The honourable member for Halifax Citadel.

RESOLUTION NO. 341

MR. TERENCE DONAHOE: Mr. Speaker, I hereby give notice that on a future day I shall move the adoption of the following resolution:

Whereas the Savage Liberals have taught their federal cousins many lessons about breaking promises; and

Whereas the federal Liberals have taken a page from the Savage Government when it comes to bouncing out dissenting members of the Liberal caucus who stick up for their constituents; and

Whereas now the federal Liberals have adopted the Savage pattern on taxes in promising to abolish the GST and then reneging on that promise;

Therefore be it resolved that the Savage Government admit it leads the way in providing a model of government in which broken promises and the silencing of dissenting voices is the order of the day.

MR. SPEAKER: The notice is tabled.

The honourable Minister of Transportation and Public Works.

RESOLUTION NO. 342

HON. RICHARD MANN: Mr. Speaker, I hereby give notice that on a future day I shall move the adoption of the following resolution:

Whereas the Minister of Finance today introduced the first completely balanced budget in Nova Scotia in over 25 years; and

Whereas the member for Shelburne, in only his third year in the House of Assembly, has now experienced the same satisfaction of balanced budgets experienced by his father, who represented Shelburne before him; and

Whereas the member for Halifax Citadel sat in this Chamber for 18 years but only today gets to see a balanced budget, unlike his father, for the first time;

Therefore be it resolved that this House congratulate the Minister of Finance for allowing the member for Halifax Citadel to enjoy the thrill of a balanced budget as his father did before him. (Applause)

MR. SPEAKER: The notice is tabled.

The honourable member for Sackville-Cobequid.

RESOLUTION NO. 343

MR. JOHN HOLM: Mr. Speaker, I hereby give notice that on a future day I shall move the adoption of the following resolution:

[Page 1057]

Whereas it is well known that corporate Canada and the Liberal Party are long-time bosom buddies, as evidenced by the $5.89 million corporate Canada donation to the Liberal Party in 1994 alone; and

Whereas further proof of this was evident when the Minister of Finance chose recently to unveil his Budget White Paper before the Metropolitan Halifax Chamber of Commerce; and

Whereas yet further proof is provided by the plan of the federal Minister of Finance to discuss his BST before that same Metropolitan Halifax Chamber of Commerce, which has already come out in support of it;

Therefore be it resolved that this House urges the Liberal Government and the other one in Ottawa to break out of its closed corporate loop and hear the views of all Nova Scotians, including those less favoured, on their damaging taxation and budgetary policies.

MR. SPEAKER: The notice is tabled.

The honourable member for Pictou West.

RESOLUTION NO. 344

MR. DONALD MCINNES: Mr. Speaker, I hereby give notice that on a future day I shall move the adoption of the following resolution:

Whereas the Minister responsible for the Advisory Council on the Status of Women failed to follow the membership selection process she agreed to in 1994; and

Whereas the minister has failed to provide an answer as to why she no longer approves of the process she agreed to two years ago; and

Whereas the resumes of the minister's appointees were faxed from the Liberal caucus office, from the member for Bedford-Fall River's office and from the minister's own office;

Therefore be it resolved that the Minister responsible for the Advisory Council on the Status of Women come clean and tell Nova Scotians exactly why an independent, community-based process she approved two years ago is no longer acceptable to the Savage Liberals.

MR. SPEAKER: The notice is tabled.

The honourable member for Timberlea-Prospect.

RESOLUTION NO. 345

MR. BRUCE HOLLAND: Mr. Speaker, I hereby give notice that on a future day I shall move the adoption of the following resolution:

Whereas Mr. Ray Turner of Beechville, Nova Scotia, combined athletic excellence and academics by winning the Boston area Independent School League scoring championship for the third year in a row by scoring 87 goals and 111 assists; and

[Page 1058]

Whereas Mr. Turner's achievements earned him a Faces In the Crowd story in Sports Illustrated and a picture, as part of a package published in the Boston Globe on all-scholastic players; and

Whereas Mr. Ray Turner was also voted by league coaches as the player best combining excellence with dedication and sportsmanship, as well as earning his league's most valuable player award;

Therefore be it resolved that the members of the Nova Scotia House of Assembly applaud Mr. Ray Turner for his current successes and for providing a role model for youth, as we wish him all the best in everything and anything he chooses to pursue in life.

Mr. Speaker, I would request waiver of notice.

MR. SPEAKER: Is that agreeable to the House?

It is agreed.

Would all those in favour of the motion please say Aye. Contrary minded, Nay.

The motion is carried.

The honourable Leader of the New Democratic Party.

RESOLUTION NO. 346

MR. ROBERT CHISHOLM: Mr. Speaker, I hereby give notice that on a future day I shall move the adoption of the following resolution:

Whereas the Minister responsible for the Advisory Council on the Status of Women has proclaimed April 25, 1996, as Take Our Daughters to Work Day; and

Whereas such a day is designated to provide the encouragement and support needed to eliminate the barriers limiting opportunities available to women today; and

Whereas the Liberal Government has yet to adopt an employment equity policy or bring forward the necessary changes to the Pay Equity Act, to truly ensure equal opportunities and economic equality for women;

Therefore be it resolved that this House recognize the importance of Take Our Daughters to Work Day but acknowledge that a single special event is not a substitute for leadership in eliminating the barriers which limit women's equality.

MR. SPEAKER: The notice is tabled.

The honourable member for Cape Breton West.

RESOLUTION NO. 347

MR. ALFRED MACLEOD: Mr. Speaker, I hereby give notice that on a future day I shall move the adoption of the following resolution:

[Page 1059]

Whereas the American Economic Development Council, an international association of more than 2,300 economic development professionals, recently held its 1996 Sales Literature and Promotional Materials Competition; and

Whereas the brochure, Cape Breton Island, Guide to Nova Scotia's Masterpiece, produced by Enterprise Cape Breton, won best of its class; and

Whereas a video, Break with Convention, produced by Crew Productions of New Waterford, was also an award winner;

Therefore be it resolved that this House congratulate these award winners and acknowledge their contribution to tourism development in Cape Breton.

Mr. Speaker, I would ask for waiver of notice.

MR. SPEAKER: Is that agreeable?

It is agreed.

Would all those in favour of the motion please say Aye. Contrary minded, Nay.

The motion is carried.

The honourable member for Colchester-Musquodoboit Valley.

RESOLUTION NO. 348

MR. BROOKE TAYLOR: Mr. Speaker, I hereby give notice that on a future day I shall move the adoption of the following resolution:

Whereas the harmonized tax will mean an additional $5 million to $8 million in costs for the new Halifax Regional Municipality; and

Whereas Mayor Walter Fitzgerald has expressed his absolute dismay in just how quiet the Halifax County Liberal MLAs have been over the potential for a 3 per cent increase in property taxes; and

Whereas Mayor Walter Fitzgerald has described Halifax County Liberal MLAs as, "standing like lambs and following the premier, the head goat";

Therefore be it resolved that the lambs not follow the flock, be good kids and represent the people who elected them, as characterized by the mayor, instead of being so passive to the head goat of the Liberal Party. (Interruptions)

MR. SPEAKER: Well, I am not sure that that resolution is noteworthy for temperate wording but nonetheless, it is tabled.

The honourable member for Sackville-Cobequid. (Interruptions)

[Page 1060]

RESOLUTION NO. 349

MR. JOHN HOLM: Mr. Speaker, it is hard to follow the eloquence of the pros.

Mr. Speaker, I hereby give notice that on a future day I shall move the adoption of the following resolution:

Whereas talks between the Department of Justice and two U.S.-based companies regarding the privatization of correctional services in Nova Scotia are continuing today; and

Whereas the Minister of Justice is refusing to permit workers' representatives to participate in these talks because the minister says they have preconceived views against privatization which obviously brings them into conflict with the Savage Government's preconceived views that favour privatization; and

Whereas an investigation into the operation of one of the U.S. companies shortlisted by government, Esmor Correctional Services, led to a U.S. contract not being renewed because of evidence the company repeatedly changed policies and deliberately withheld information from government officials and exercised no real control over guards who were only marginally qualified and poorly trained;

Therefore be it resolved that the Savage Government cease and desist its hare-brained plans to privatize to a for-profit company the operation and management of correctional facilities as the potential savings do not justify the increased risk to the safety of the public and correctional officers.

MR. SPEAKER: Now I am going to have a little bit of a procedural problem with that particular resolution because an identical resolution was submitted by the same honourable member for the late debate and was the successful entry. So, the House will be debating that resolution at 6:00 p.m. Now whether it should be given a double entry or not, I do not know.

MR. HOLM: Mr. Speaker, that has not been called yet. (Interruptions)

MR. SPEAKER: Well, I will allow it to be printed twice in Hansard, I guess. That is conservation of printer's ink.

The notice is tabled.

The honourable member for Cape Breton West.

RESOLUTION NO. 350

MR. ALFRED MACLEOD: Mr. Speaker, I hereby give notice that on a future day I shall move the adoption of the following resolution:

Whereas the staff at the Nova Scotia Liquor Commission outlet on Welton Street in Sydney recently participated in a fund-raising initiative for the Children's Wish Foundation; and

Whereas a total of $13,557.15 was raised and donated to the Children's Wish Foundation; and

[Page 1061]

Whereas store Manager Roy Peters on behalf of the staff of the Welton Street store was recently presented with a plaque of appreciation from the Nova Scotia Chapter of the Children's Wish Foundation;

Therefore be it resolved that members of this Legislature congratulate Manager Roy Peters and his staff at the Nova Scotia Liquor Commission outlet on Welton Street in Sydney for their kindness and their generosity in assisting the Children's Wish Foundation.

Mr. Speaker, I would ask for waiver of notice.

MR. SPEAKER: Is that agreeable to the House?

It is agreed.

Would all those in favour of the motion please say Aye. Contrary minded, Nay.

The motion is carried.

The honourable member for Kings North.

RESOLUTION NO. 351

MR. GEORGE ARCHIBALD: Mr. Speaker, I hereby give notice that on a future day I shall move the adoption of the following resolution:

Whereas Canadian National Railways has announced that it will close the rail car maintenance facility located in Fairview; and

Whereas the Savage Government has not protested this closure nor has it spoken out about the other moves which have weakened our national transportation links; and

Whereas the Premier wants voters of Halifax Fairview to judge his government on their record in the upcoming by-election;

Therefore be it resolved that the voters of Halifax Fairview judge the Premier on his record and show their contempt for this government which again has uttered not a single word in support of Nova Scotians.

MR. SPEAKER: The notice is tabled.

The honourable member for Queens.

[3:30 p.m.]

RESOLUTION NO. 352

MR. JOHN LEEFE: Mr. Speaker, I hereby give notice that on a future day I shall move the adoption of the following resolution:

Whereas booksellers and book buyers are reeling with the news that the Savage Government is about to impose an increase in taxes of over 50 per cent on books; and

[Page 1062]

Whereas booksellers and book buyers in Nova Scotia are already predicting that the impact of the GST will decimate their businesses and their purchases and it will affect the buying of books in Nova Scotia; and

Whereas the Savage-Boudreau Government pats itself on the back about its efforts to promote learning and literacy;

Therefore be it resolved that the Savage-Boudreau Government be condemned for imposing a whopping 50 per cent tax increase on literacy and students and other book buyers by suffocating the purchase of books with the harmonized GST/PST.

MR. SPEAKER: The notice is tabled.

The honourable member for Colchester-Musquodoboit Valley.

RESOLUTION NO. 353

MR. BROOKE TAYLOR: Mr. Speaker, I hereby give notice that on a future day I shall move the adoption of the following resolution:

Whereas property taxes for businesses and homeowners in the new Halifax Regional Municipality are expected to skyrocket as a result of this Savage Government's disastrous planning initiatives; and

Whereas the member for Timberlea-Prospect, himself a former municipal councillor, has wrapped himself in a thick layer of fog and is attempting to blame others for the trouble his government has created; and

Whereas the member for Timberlea-Prospect said yesterday that his government is being blamed for every problem including changes in the weather;

Therefore be it resolved that the member for Timberlea-Prospect understand that not only are Nova Scotians looking forward to changes in the weather, but also a change in government that will stop the incessant downloading and property tax increases being imposed upon municipal units by the government of which he is a member.

MR. SPEAKER: The notice is tabled.

The honourable member for Halifax Citadel.

RESOLUTION NO. 354

MR. TERENCE DONAHOE: Mr. Speaker, I hereby give notice that on a future day I shall move the adoption of the following resolution:

Whereas the GST plan so far leaves Nova Scotians in a state of disparity with seven other provinces when it comes to paying the GST; and

Whereas Nova Scotians will pay 52 cents for every 45 cent stamp, but other Canadians in seven other provinces will pay only 48 cents; and

[Page 1063]

Whereas the cost to Nova Scotia business of levying an extra 8 per cent tax on postal rates will leave them at a serious financial disadvantage against businesses in seven other provinces;

Therefore be it resolved that the Savage Government take steps today to ensure that before finalizing the GST, an escape clause is built into the agreement permitting cancellation of this deal if every jurisdiction in Canada does not come on board, thereby levelling the playing field.

MR. SPEAKER: The notice is tabled.

That would appear to conclude the daily routine for today. We will now advance to Orders of the Day and into the Oral Question Period. The Oral Question Period today will last for one hour: from 3:33 p.m to 4:33 p.m.

I have already noted that the honourable member for Sackville-Cobequid had won the Adjournment debate and we have heard his resolution already.

[Therefore be it resolved that the Savage Government cease and desist its hare-brained plans to privatize to a for-profit company the operation and management of correctional facilities as the potential savings do not justify the increased risk to the safety of the public and correctional officers.]

ORDERS OF THE DAY

ORAL QUESTIONS PUT BY MEMBERS

MR. SPEAKER: The honourable Leader of the Opposition.

FIN.: PST & GST HARMONIZATION - RESULTS

DR. JOHN HAMM: Mr. Speaker, it was difficult to decide what to ask today of the Minister of Finance because in the last few days he has been consumed about getting his Budget Address ready and telling us what is going to happen in 1997-98 and all the good news that would happen after the next election and, as well, worrying about introducing the new harmonized tax. Anyway, I was wondering what I could ask for a question.

I filled up my gas tank this morning on the way down to the House and I suddenly had an idea because when I got the slip, my bill was $28.89 for gas. (Interruption) It was self-serve. That question was from the Minister of Transportation, Mr. Speaker.

I looked at the slip I got. I got $27 worth of gas and I paid $1.89 in GST and that amounted to $28.89. Then I got to figuring that once the new harmonized tax comes in, and I pay an additional 8 per cent, what will $28.89 worth of gas cost? This is relevant to anybody who fills up their tank here in Nova Scotia. It will cost $31.05. Will the minister confirm that that is so, and will the minister give us an estimate as to how much revenue he expects to obtain by the new 8 per cent tax which will come on as the result of the harmonized tax and which will be applied to such things as diesel fuel and gasoline for automobiles? What revenue does the minister expect to receive from that?

[Page 1064]

HON. BERNARD BOUDREAU: Well, Mr. Speaker, there are a number of questions in that group. But let me tell you this, if the honourable Leader of the Opposition can predict gasoline prices with such accuracy, he hasn't been watching what has happened in the metropolitan area over the last couple of months. I don't think you could have predicted gasoline prices from one day to the next. That is exactly the point, Mr. Speaker.

With respect to his question about the gains and losses in the harmonization proposal, I will tell you globally that we will collect $120 million less taxes.

DR. HAMM: Well, the Minister of Finance says I should be happy about the $120 million in tax savings we are all going to receive. We will wait and see if that really happens but I know full well that I am going to be paying more for my gas, as will every other Nova Scotian, including tourists, all Nova Scotians, truckers. Every time you fill up your tank, it is not really going to make a lot of sense that somehow we are better off.

Anyway, bearing in mind that revenues from fuel taxes traditionally in this province go to the construction and maintenance of roads, will the 8 per cent that the minister will receive as a result of the additional fuel tax in this province go to the maintenance and construction of roads?

MR. BOUDREAU: Well, Mr. Speaker, I can't pass up the preamble. The honourable member says now that truckers will have to pay more; we are sure the price is going to go up, we are sure the tax is going to go up. Perhaps he might explain to me in one of his supplementaries how he believes that and why he feels the truckers won't have input tax credits on those items. I don't understand what he is getting at.

In any event, Mr. Speaker, with respect to dedicated tax money to highways, the former Conservative Government dedicated ostensibly a certain percentage of revenue to highways. After some time even they gave it up, after one year, as a meaningless gesture, designed more for politics than for anything else.

DR. HAMM: To the Minister of Finance, well my ability in politics and my ability to be political pales before the abilities of the Minister of Finance.

Will the Minister of Finance, and the Minister of Finance threw out the challenge because he said for me to prove that, in fact, the trucking industry and others who purchase gas in this province will in fact be advantaged, not disadvantaged, by paying increased gasoline and diesel oil prices when they are fuelling up their vehicles. Will the minister, and has the minister information, when he did his studies, that increasing the costs of gasoline and diesel fuel in this province will, in fact, not disadvantage truckers and not be a negative impact on tourism in Nova Scotia? In other words, does he have anything, other than to suggest I am being political, to add to this argument?

MR. BOUDREAU: Mr. Speaker, the honourable Leader of the Opposition can't escape the history of his own Party simply because he doesn't like it. These measures were brought in and then abandoned by his Party not so many years ago. The honourable Leader of the Opposition made a clear statement, I think I heard it, he said truckers were going to have to pay more taxes. I simply asked him why he came to that conclusion because I don't know what he would have based it on. Why would he have concluded that they would not get input tax credits? I don't know what he bases that on.

[Page 1065]

MR. SPEAKER: The honourable member for Sackville-Cobequid.

FIN. - PST & GST HARMONIZATION:

MEMORANDUM OF UNDERSTANDING - TABLE

MR. JOHN HOLM: I, too, would like to direct a question to the Minister of Finance. When the minister introduced his propaganda package that went along with the BST that he was announcing included within that a copy of the Memorandum of Understanding on sales tax harmonization. Going through that Memorandum of Understanding, I noticed there are a few fill-in-the blanks, particularly on the last page where it has copies of the signatures and also the date upon which it was signed. My question to the minister is quite simply, will the minister agree to table on the floor of the House today, a copy of the memorandum in its complete form with the blanks filled in, in other words, the signatures, the minister's signature included on it and the date upon which it was signed? Will the minister agree to table that?

HON. BERNARD BOUDREAU: Mr. Speaker, I take it from that the honourable member wants a signed copy of the agreement. I will certainly provide him with a signed copy of the agreement, whether it will be by the end of the day today, I simply undertake that either today or by the end of this week or early next week I will provide that to him. I don't know what the honourable member is driving at but if he wants a signed copy, he will get a signed copy.

MR. HOLM: Mr. Speaker, I certainly was anticipating that the minister would be only too eager and happy to provide the signed copy. I don't know why it would take a couple of days, I am sure the minister has enough staff that he could get a photocopy. My next question is that the minister for the Province of Nova Scotia negotiated, along with the partners, New Brunswick and Newfoundland, with Ottawa this harmonized BST. They also announced that agreement at the same time. It is interesting that New Brunswick signed that harmonized agreement on April 12th according to the document that they tabled. My question to the minister is quite simply this, will the signed copy that he is going to have tabled differ from the agreement that was signed by New Brunswick or are the two agreements the same?

MR. BOUDREAU: Mr. Speaker, obviously the honourable member is hot on the trail of something very major here. I just can't for the life of me figure out what it is. The agreements, as I understand it, are identical. The provisions of the agreements are identical but if he will wait just a day or two I will get him a signed copy so he can compare them himself.

MR. HOLM: Mr. Speaker, I thank the minister for his patience with me on this matter and I apologize if I happen to be trying it a little bit. I have gone through the agreement that New Brunswick signed and I went through the agreement that the minister tabled. This one was signed by New Brunswick over a week ago when this minister was running around and telling Nova Scotians that we do not even have an agreement in principle, yet, it is virtually identical to the one that he passed out. My question to the minister is quite simply this, how does he have any expectations that the people in this province will put any faith in what he is saying, any credibility in his words, when he is telling people, and obviously misled, by accident because you can't do it on purpose, he misled people when he was telling them that there was not an agreement in principle when in fact, all of the terms and conditions had been reached well before the minister was even prepared to acknowledge such a fact?

[Page 1066]

MR. BOUDREAU: Mr. Speaker, I don't think anyone ever asked me when New Brunswick reached an agreement, I don't think so. So, I don't think I ever commented on when New Brunswick reached an agreement.

MR. SPEAKER: The honourable member for Halifax Citadel.

FIN. - PST & GST HARMONIZATION: ELECTRICITY COSTS - INCREASE

MR. TERENCE DONAHOE: Mr. Speaker, my question as well is for the Minister of Finance. Through you to the minister, in the blended or harmonized PST/GST deal, it appears now that the situation has developed where electricity costs for consumers will increase by something in the order of 50 per cent. In today's paper the minister is, I think, trying to effect some damage control by suggesting in some not so veiled threats, that he is going to move on Nova Scotia Power or take some steps either directly or through the Utility and Review Board and so on, to address that difficulty which will confront thousands of Nova Scotian families.

Will the minister tell the House today what direct steps he does intend to take relative to Nova Scotia Power Inc., either by way of OIC or legislation or, indeed, application to the Utility and Review Board to cushion the Nova Scotian family against that 50 per cent electricity increase?

[3:45 p.m.]

HON. BERNARD BOUDREAU: First of all, Mr. Speaker, one of the things we will do in an attempt to cushion that family or any family, particularly low income families, against any such situation will be implementing a massive low income tax rebate program. So that, in fact, a family with an income of $15,000 may see a reduction in their income tax of up to $900. That will be $900 more money they have in their hands. So, that will be part of what we will do to shield that particular individual.

Also, I think what the honourable member refers to, I have indicated in response to questions from interested media, I have indicated that there are some areas where the flow-through of savings from business will be virtually guaranteed and virtually 100 per cent. Let me give an example. In the construction industry, in a tendering situation, it is very likely that any price advantage that a tendering company will have, they will use that price advantage in advancing their tender. So in those situations, and the economists will tell us this as well, we can see a pass-through of savings virtually guaranteed of almost 100 per cent.

There are some other areas where the pass-through is not guaranteed at 100 per cent and one of them is in an area of the N.S. Power Inc., where that is, obviously, a monopoly, there is not a competitive situation in our province. In those areas, we have a special responsibility as a government to sit down with the power company and ensure that any savings advantage that they get is passed along to the customer.

MR. DONAHOE: Mr. Speaker, well, in his last few sentences the minister, of course, after the promo for the pass-throughs and so on, came to the point of my question. The fact of the matter is that we are in a monopoly situation and we have tens of thousands of Nova Scotian families who aren't going to be, unless he and his government does something about it, the beneficiaries of anything but a 50 per cent increase in their cost of electricity. So by way of, I think, my final supplementary, Mr. Speaker?

MR. SPEAKER: This is your first.

[Page 1067]

MR. DONAHOE: My first? By way of supplementary then to the minister, I ask if it is fair for me to translate and understand the words he just used a moment ago as representing an undertaking by him on behalf of the Savage Government that some steps, as yet undetermined, will be taken and that he, in fact, is guaranteeing that there will not be a 50 per cent increase to the electrical consumer in Nova Scotia as a result of the blend of the PST and GST and that by way of Order in Council, legislation or URB decision or some other mechanism that he dreams up, he makes that guarantee to the Nova Scotia electrical consumer?

MR. BOUDREAU: Mr. Speaker, the honourable member wants me to guarantee that there won't be a 50 per cent increase. I could do that easily, because the honourable member has his figures wrong. It wouldn't be a 50 per cent increase. But I don't want to trivialize the question.

Mr. Speaker, what I will commit to, on behalf of this government, is to sit down, as we have done already from time to time, with the Nova Scotia Power Inc., as we will sit down with the booksellers, as we will sit down with the municipalities and many others, and discuss the impact of this new tax reform on both sides of the ledger, both in terms of the sales tax reductions and in terms of the income tax reductions. We will sit down with the power corporation. I anticipate that all of the savings that they receive, once we determine precisely what those are, will benefit their customers.

MR. DONAHOE: Mr. Speaker, well, you know what is so astounding about this minister and his financial planning and the approach that he and his Premier and this entire government take. (Interruption) The Premier says that he is right. Well he is right according to the Premier's thesis. The Premier's thesis is that you shoot first and ask questions later; you impose policy first and then ask the consumers later.

My final supplementary to the Minister of Finance is whether or not he intends - he has indicated here today that he intends to sit down with the Power Corporation, he intends to sit down with the booksellers - I ask him to tell Nova Scotians why is it that he has announced this particular commitment to a merger or a harmonization of PST and GST in a "we are doing it today, details to follow process"? Will the Minister of Finance please offer an explanation to the taxpayers of Nova Scotia why the consultations with the taxpayers of Nova Scotia did not take place before the commitment by this government to the deal with Paul Martin and the Government of Canada?

MR. BOUDREAU: Mr. Speaker, because we are committed to the principles of that deal. We are committed to reforming the tax system in this province. We are committed to reducing the rate from 18.8 per cent to 15 per cent. We are committed to a sweeping program of income tax reductions. Now what part of that does the Opposition disagree with? What part of it?

We will consult with Nova Scotians about maximizing the advantages and minimizing the problems. But let me tell you, we will stand up and say, both here today and over the next year, this is a great deal, the entire package will benefit every single Nova Scotian income level.

[Page 1068]

Let them stand up and say they reject this deal. Let the Leader of the Official Opposition say that he is against harmonization, that he is against the package of income tax reforms that we have placed before the House today; at least let them tell the public what they believe.

MR. SPEAKER: The honourable Minister of Community Services, on a brief introduction.

HON. JAMES SMITH: Mr. Speaker, I will be brief in my introduction, taking time from Question Period. There is a special group in the east gallery that I would like to introduce on Take Our Daughters to Work Day. They are ages 11 years to 20 years. They are accompanied by staff from the Department of Community Services who, by the way, have put on a great program throughout the day. The whole day has been planned, I think they have been kept busy and I had a chance to meet with a few of them.

I will take the privilege of the House for myself and say that it does include my daughter, Alexa. But I would ask all of them to rise and receive the warm welcome from the House. Thank you very much for coming. (Applause)

MR. SPEAKER: I will add an extra minute to Question Period because of that.

The honourable member for Cape Breton West.

ENVIRON. - SYDNEY RIVER: LEAD CONTAMINATION - SOLUTION

MR. ALFRED MACLEOD: Mr. Speaker, my question through you is to the Minister of the Environment. Yesterday we spoke about the lead contamination problem in the area of Sydney River, which was created by sandblasting. Under the Act it says, "adverse effect means an effect that impairs or damages the environment, including an adverse effect respecting the health of humans or the reasonable enjoyment of life or property.". This whole situation has been an adverse effect on a number of families there. It appears that negligence is the bottom line; I am not sure if this was done through prejudice or through incompetence.

My question to the Minister of the Environment. Will he give this House, and those people who live in that area, his pledge of a full, public inquiry into the situation and why did it take four years to find a solution to that problem?

HON. WAYNE ADAMS: Mr. Speaker, I believe that question sounded similar to the one yesterday. I gave my undertaking that we were pursuing, with all due diligence and with proper haste, the collection of the data that is relevant to the lead contamination that was deemed to be very obvious in the Sydney River area.

As I said yesterday, Mr. Speaker, we are working with PetroCanada, the provincial Department of Health and the residents affected. I believe we are moving to a positive resolution in that regard.

As with respect to what happened in 1992, as I said yesterday, I can't be responsible for the past government but I do know that when we became aware of it, we went to work and brought about a rather quick solution to the one affected family in that region.

MR. MACLEOD: I think if the House would take the time to read the documents that were tabled in this House yesterday, you will find that this problem came to light in late 1993.

[Page 1069]

Anyway, the question here, I would like to table a document that is dated December 4, 1995 and it is from the Department of Environment. It says, at this point in time I would strongly suggest that we would provide all parties involved with whatever documentation and reports we might have in relation to tests or investigative measures conducted by our department.

My question is quite simple, I would like the minister to honour this document and make sure that the rest of the residents of that area get the proper documentation at the quickest possible time.

MR. ADAMS: Yes, Mr. Speaker, the document is binding and the answer is yes.

MR. MACLEOD: On my final supplementary I would like to again table another document dated January 17, 1996. In this, this document removes some people from this case and I would like to ask the minister if, indeed, he will assign to the rest of the residents the same individual who brought forward the resolution to the MacKenzie case. Would the minister give that commitment to the House today, please?

MR. ADAMS: The final task of assigning staff are the responsibility of the deputy and this morning at our senior staff meeting, my wishes were made rather clearly as to who and what I wanted to see happen in that regard.

MR. SPEAKER: The honourable member for Cape Breton West.

ENVIRON. - SYDNEY TAR PONDS: RISK ASSESSMENT - COMMIT

MR. ALFRED MACLEOD: Mr. Speaker, I would like to thank the Minister of the Environment for that answer.

My new question is also to the Minister of the Environment and there is a great deal of concern and uncertainty around the Sydney tar ponds and part of that concern is that there has been no environmental assessment as yet and there are health risks associated with the plan to bury the problem. Will the minister assure this House and the residents of the Sydney area and, indeed, all Nova Scotians that a risk assessment will be carried out before the work is begun?

HON. WAYNE ADAMS: Mr. Speaker, I believe that we are clearly on record as having announced that a full Class 2 environmental assessment will take place once the project is deemed to be a recommended project.

MR. MACLEOD: Thank you, Mr. Minister, for your answer. My first supplementary again is to the Minister of the Environment. I would like to ask, given the uncertainty and the concern surrounding the PCBs in the tar ponds, would the minister agree to table details of the location and the amount of the PCBs found in the tar ponds before any work is carried out?

MR. ADAMS: Mr. Speaker, clearly that project comes under the jurisdiction of the Sydney Tar Ponds Incorporated. The minister responsible is the Minister of Transportation and Public Works and I am sure he would perhaps answer that question more appropriately.

[Page 1070]

HON. RICHARD MANN: The member is asking us to table something which we do not yet have. We will be receiving that report probably in a number of weeks given the fact that we have stepped up the amount of testing and sampling to be done. We will be responding to the report when we receive it.

MR. MACLEOD: Take it easy Robert . . .

AN HON. MEMBER: Three more questions and you can get up, Rob.

MR. SPEAKER: There is one more Tory question left before the NDP.

MR. MACLEOD: Mr. Speaker, my final supplementary is to the Minister of Transportation and Public Works. Given this government's record with monitoring and enforcing contracts with the private sector companies, like the Sheraton International, would the minister agree to table the contract between the department and Jacques Whitford Environmental Limited that are dealing with the Sydney tar ponds clean-up?

MR. MANN: That member opposite talks about our record in signing contracts and monitoring when, in fact, on the very project he is speaking of, the tar ponds, the previous administration signed a contract, spent $60 million for information that turned out to be erroneous and he has the gall to stand up and talk about monitoring reports with the private sector. He has been told in this House - I am sure he has read, I am sure he is aware, it has been said many times - that the contract between the Sydney Tar Ponds Clean-Up Inc. and Jacques Whitford is a three phase one which involves environmental work, including testing and sampling; an assessment; and remediation. So it only makes sense that when the report is received that there is going to be an assessment done of that report based on the contents of it.

[4:00 p.m.]

MR. SPEAKER: A new question, the honourable member for Queens.

FISH. - PROCESSING PLANTS: FEES INCREASE - ACTION PLAN

MR. JOHN LEEFE: Mr. Speaker, my question is for the Minister of Fisheries. On Tuesday, the minister was kind enough to invite me to a meeting which he had arranged, where a number of Nova Scotia processors and members of his staff and various MLAs met to discuss the urgency of defining action with respect to combatting the excessive fees that the Department of Fisheries and Oceans is intending to impose on the processing sector in Nova Scotia. By way of one example, one processor, a small company in northern Nova Scotia, applied the proposed fees to his last year's licenses and export certificates, and if those fees were applied this year it would cost him $25,000 more simply to stay in business. The minister is aware of all of this; I don't say this to chide him, because he very much wants to be part of the solution and, again, I thank him for inviting me, along with the other MLAs, to that meeting.

My question to the minister is, who in the department, consequent to the meetings on Tuesday, has been put in charge of the action plan with respect to coordinating provincial government, industry initiatives, with respect to trying to bring DFO to its senses?

[Page 1071]

HON. JAMES BARKHOUSE: The member opposite raises a very important issue that has been just recently documented by the federal government's gazetting of the proposed fees for the processing industry. There is a concerted effort by our government, not only my own department, but other departments working in concert with my Department of Fisheries, and I do have staff members, the director of technology who is very much involved with this, but the whole department is putting in a concerted effort on it. I will be speaking with the federal Minister of Fisheries and Oceans tomorrow morning.

MR. LEEFE: Mr. Speaker, I wonder if the minister could advise when he anticipates the Nova Scotia Department of Fisheries and Nova Scotia's processing sector will have an action plan ready to present to the federal minister?

MR. BARKHOUSE: I anticipate in the very near future. I am consulting, again, with the people who participated and other industry participants - processors and those who are industry leaders - to get their opinions of the methods of attack, alternate solutions, rather than just a $4.8 million fee imposed on the processors. We are looking at alternate solutions, so we are consulting further with the industry processors and leaders. We are also working interdepartmentally on different proposals which we will then be assessing and, hopefully within the next few weeks, we will have a very well-planned strategy to deal with the federal negotiations.

MR. LEEFE: Mr. Speaker, the federal minister provided a 30 day window for response to the proposed fee increases, fee implementations, and about one-half of that time is already gone, so we are in an urgent timeframe with the window of opportunity closing. The minister, again, is aware of that, and that is why he called that meeting on Tuesday.

My final question to the minister is this. If he does not receive a favourable response from Mr. Mifflin tomorrow, in his telephone conversation with the federal minister, is our provincial minister prepared, on the assumption that our industry requests him to do so, to lead a delegation of Nova Scotia processors to Ottawa to meet with Mr. Mifflin in advance of the end of that 30 day deadline occurring?

MR. BARKHOUSE: Mr. Speaker, again, I thank the member opposite for his participation in the meeting this week. The industry did bring forth some recommendations, such as sending a delegation to Ottawa. I would certainly be prepared to work very closely with the industry and other members, especially our MPs, who are also very concerned about that. The fees that are being imposed upon the processing industry could cause severe difficulties for many small operators in this province. In Nova Scotia we have 317 registered plants and this could cause great hardship in our rural communities and I am prepared to go to Ottawa when necessary and we will be dealing with this issue in a very strong manner, working with the industry.

MR. SPEAKER: The honourable Minister of Human Resources.

HON. JAY ABBASS: Mr. Speaker, in the east gallery, as part of Take Our Daughters to Work Day, we have daughters of members of my department, the Department of Human Resources. We have Robyn Brown, Angel Snair, Amy Cassell, Amy MacArthur, Alise Brown, Michelle Lucas, Nicole Lucas and Carol Anne Lawrence. They are accompanied, of course, by hard-working members of my department whom I want to thank for putting on today's very interesting agenda of events. (Applause)

[Page 1072]

MR. SPEAKER: The honourable Minister of Housing and Municipal Affairs.

HON. SANDRA JOLLY: Mr. Speaker, it is my pleasure as well to introduce in the west gallery the staff of the Department of Municipal Affairs who have brought their daughters to work. I am very pleased to have those daughters with us today. This has been a great program. It has been participated in very well. I think one of the unusual things for the daughters in the Department of Municipal Affairs, is that they have both a woman minister and a woman deputy minister. I think that, as we have said earlier, we are looking to many of these young women maybe sitting in the House of Assembly as the new group of women who will be here participating in politics, as those women who are already here would like to see more, or municipal government. (Applause)

MR. SPEAKER: Now we will lengthen Question Period for two additional minutes as a result of those introductions.

The honourable Leader of the New Democratic Party.

MR. ROBERT CHISHOLM: So does that mean we end at 5:00 p.m.?

MR. SPEAKER: No, at 4:36 p.m.

MR. CHISHOLM: Okay. (Interruptions)

MR. SPEAKER: The honourable Leader of the New Democratic Party.

FIN. - PST & GST HARMONIZATION: CONSUMERS - EFFECT

MR. ROBERT CHISHOLM: Mr. Speaker, I want to direct a question through you to the Minister of Finance. Some of us have been somewhat concerned about this harmonization of the GST and the PST and the effect that that will have on consumers in the Province of Nova Scotia. I want to ask the minister, in view of the statement from the Minister of Finance of Saskatchewan, someone who I think even this Minister of Finance would agree, has some considerable experience at balancing budgets, she has suggested that the BST harmonization deal would have meant a shift of $400 million a year in taxes to consumers from business. I would like to ask the Minister of Finance if he could tell the House how many hundreds of millions of dollars in tax burden will be shifted from business to consumers in the Province of Nova Scotia?

HON. BERNARD BOUDREAU: Mr. Speaker, I do not want to directly comment on the Minister of Finance for Saskatchewan, the Honourable Janice MacKinnon, who I know well and admire her accomplishments in Saskatchewan. I have to tell the honourable member, though, that the situation in Saskatchewan is fundamentally different from the situation here and I will tell you why. Perhaps it makes it somewhat more difficult for Saskatchewan to deal with this issue in the same way we have dealt with it.

First of all, in Saskatchewan they do not have the advantage, on the consumer side, of the reduction in rate. I am not positive what their rate is but it is probably something in the range of 8 per cent. Assuming it is 8 per cent (Interruptions) Well 9 per cent, then there is no advantage to the consumer in the same way that the reduction of 3.8 per cent is here. Secondly, the Province of Saskatchewan, I believe, already taxes corporations on the corporation capital tax, one we are proposing to introduce as an accompanying measure. They may or may not feel that they can shift some of the benefit as we have shifted from the

[Page 1073]

wealthy corporations to the least advantaged citizens of the province. They may not feel they have the capacity to do that there.

For whatever reason, I can tell the honourable member that the most fundamental problem I have with the premise that the honourable member makes is the belief that when you tax business $1.00 it does not get passed on somehow. Of course it gets passed on. That is really where any distinction between $1.00 of tax to the company that sells you the goods or $1.00 that you are taxed is pretty artificial. But, fundamentally, the difference between Saskatchewan and ourselves, I guess, is first of all the advantages of the reduction in rate that we achieve and perhaps the unwillingness or incapacity to make the same kind of sweeping reforms that we have made on the other side of the ledger in the income tax field.

MR. CHISHOLM: Mr. Speaker, let's try to be clear in some of this discussion. The Minister of Finance in Saskatchewan knows well what the effect of the blended sales tax is going to have on her province and on the revenues. In fact, she is quoted as saying that approximately 50 per cent of the revenue now collected by the sales tax in that province, the 9 per cent, would disappear under the blended sales tax and would have to be made up by consumers. In this province, even though there have been some changes that would represent to those finance capital corporations with financing capital over $10 million, they are now going to be paying an extra $45 million. It still comes a long way short to compensating for the $400 million to $500 million that is going to be shifted off of businesses because of the business input credits on the consumers.

I want to ask the minister how he can justify agreeing to something that the minister in Saskatchewan and other places in this country, as well as in this province, people would suggest, that will clearly see the average family in this province paying more so that business in this province can pay less?

MR. BOUDREAU: Mr. Speaker, that is a fundamental flaw in the logic there and the reasoning. But I turn it back on the honourable members and say, is the Minister of Finance in Saskatchewan prepared over the next four years to additionally tax the rich corporations in her province by approximately $200 million? Maybe she isn't. Is the Minister of Finance in Saskatchewan prepared to give a reduction in income tax, mostly the low income earners over the next four years, in excess of $200 million? Maybe she isn't, I don't know, but we are not dealing with Saskatchewan here, we are dealing with Nova Scotia. In Nova Scotia, every single income level in this province will benefit from the whole sweeping tax reform package that we introduced today. (Applause)

MR. CHISHOLM: Mr. Speaker, the minister can again get out his trumpets and try to present this deal as a good news budget, as a good news package for Nova Scotians. But Nova Scotians know that they are going to be paying 50 per cent on family essentials as a result of this package and what they don't have are the details. We are getting them from New Brunswick, Saskatchewan, Ontario and everywhere else but the Minister of Finance. Nova Scotians want to know what this is going to mean in the final analysis because clearly, even with the information that we have received today, there is going to be a huge shift of tax burden from business to Nova Scotians. I want to ask the minister to explain to us here in the House how much of this tax burden wage earners and Nova Scotians are going to be asked to pick up because we know that businesses are going to be recognizing savings in the $400 million to $500 million range?

[Page 1074]

MR. BOUDREAU: Mr. Speaker, the honourable member is picking figures out of the air. The fundamental issue is - and we have said it already - that in the package of tax reforms that we have outlined today in the budget, every single income level will be better off. I don't know why the honourable member objects so much to making Nova Scotian business more competitive? Why does that stick in his craw so badly? Because that is where the jobs come from. That is where the jobs come from. (Interruption) I don't know where he thinks jobs come from. (Interruptions) The only suggestion he had the other day, he had a suggestion the other day that we add another few thousand people on to the public payroll. That is not where it comes from, we will make Nova Scotian business more competitive. If you don't accept that from me, why don't you listen to Premier Harris of Ontario complain because our businesses now have a competitive advantage? (Applause) I don't know if that upsets the Opposition but it sure as heck doesn't upset me.

[4:15 p.m.]

MR. SPEAKER: The honourable member for Hants West.

FIN. - PST & GST HARMONIZATION: SHARE (N.S.) - FIXED

MR. RONALD RUSSELL: Mr. Speaker, my question is for the Minister of Finance. The Memorandum of Understanding that he has signed, details that the provincial tax shall remain at 8 per cent for the next four years. Does that mean that if indeed everything works out the way the Minister of Finance predicts and we are going to have thousands of people employed that at the present time are looking for jobs, if indeed the tax coffers are going to start flowing with gold, does that mean that he cannot reduce the provincial share of that tax below 8 per cent for the next four years?

HON. BERNARD BOUDREAU: Mr. Speaker, that is correct, without the consent of the other parties to the agreement. I am sure if that situation results, they will be as anxious as we will to reduce taxes even further. However, there are other options to give tax relief and we will use all of them if we find ourselves in that situation.

MR. RUSSELL: Mr. Speaker, the province is locked in for four years. Why is the federal government not locked in for four years because under this memorandum, the federal government can increase their share of the tax any time that they want? Why did the agreement not stipulate that the federal government was under the same constraints as the province?

MR. BOUDREAU: Mr. Speaker, the honourable member refers to the difficulty Nova Scotians have in believing that tax is going to be lowered, particularly in the substantial way we have outlined here today and he is right. Nova Scotians do have difficulty believing that. Why would you believe that income tax would be lowered in a province where it has never happened before, never? I can understand that Nova Scotians are a little bit skeptical. I would just remind them that not many people believed us when we said we were going to balance the budget three years ago.

The honourable member is worried that we won't be able to reduce taxes. We have entered into an agreement with the other provinces that we won't get out of step with them, that we won't adjust the taxation without their agreement. We think that is reasonable. As a matter of fact, when we did get a little out of step a few years back I can remember the complaints coming from these very same Opposition benches on that point. So, we are going to stay in step and if we are able to, we may even give a larger tax reduction. But I will tell

[Page 1075]

you, the one we have now committed to is by far the largest in the history of this province. (Applause)

MR. RUSSELL: Mr. Speaker, half an hour or so ago I called the Minister of Finance, Lucky Bernie. I think we should call him, Slippery Bernie because he never even approached, in the remotest way, the question that I asked him. The province is constrained, why is the federal government not constrained under this memorandum? What is to prevent the federal government, for instance, the year after next they are getting a little hard up and they jack the rate up to 10 per cent? What is to stop them? Would the minister please inform the House?

MR. BOUDREAU: Mr. Speaker, the federal government will adopt a tax policy that is appropriate for the federal government. We have adopted a tax policy that reduces the tax rate in this province substantially, as I have already indicated to the House. If the honourable member is concerned that we should reduce it even further, then we will just have to wait and see how the economic activity, which we are sure will result, builds growth and delivers jobs to our economy. I hope that the estimate we made of 3,000 jobs turns out to be wrong. I hope New Brunswick is closer to the truth because they have estimated 10,000 jobs. I hope they are right; I hope we are wrong on that one. If we are, perhaps we will have enough growth in the economy to consider even further tax changes. (Applause)

MR. SPEAKER: On a new question, the honourable member for Hants West.

FIN. - TAXATION: FLAT RATE - INTRODUCTION

MR. RONALD RUSSELL: Mr. Speaker, the Minister of Finance is talking about 3,000 jobs, maybe 10,000 jobs. I know darn well that, when these people get out on the election trail with their red book and their Budget Book, it is going to be 50,000 jobs, because in the last election it was 58,000 jobs and at the present time we have 62,000 people unemployed. That is some reduction in three years of mismanagement by these people on the front benches opposite.

AN HON. MEMBER: You don't have credibility.

MR. RUSSELL: We don't have any credibility? You go out and talk to the people of Nova Scotia and find out what kind of credibility you have.

AN HON. MEMBER: Experts in mismanagement.

MR. RUSSELL: Experts in mismanagement. Well, Mr. Speaker . . .

MR. SPEAKER: A question, please.

MR. RUSSELL: Yes, my question refers again to the Memorandum of Understanding. It deals with the matter of what they can do with regard to taxes. The question I ask is, if the federal government agrees to administer a flat tax of provincial design on personal income for the province at no cost, will the minister confirm today in the House that the Department of Finance is looking at the institution of a flat tax for Nova Scotians?

HON. BERNARD BOUDREAU: Mr. Speaker, I think if we had been looking at it you would have heard about it in the budget. No, we are not.

[Page 1076]

MR. RUSSELL: Obviously that can be removed from the Memorandum of Understanding, I would think.

The Memorandum of Understanding also says to allow the deductibility of incremental provincial payroll and capital taxes for federal corporate income tax purposes. Is the minister looking at the present time at provincial payroll taxes?

MR. BOUDREAU: Mr. Speaker, these questions are timely but rather puzzling. We have just tabled the budget. We have just laid out all of what we are proposing. As a matter of fact, one of the objections that the Opposition made was that we have laid out two years' worth of plans, and he still asks me if we are contemplating additional tax measures. I think that if we were, we would have included them in the budget.

MR. RUSSELL: You see, Mr. Speaker, this is fiscal 1996-97 that we are looking at at the present time; this other budget is fiscal 1997-98. I don't think these people will even be in the front benches this time next year. They are going to be over here somewhere.

I would suggest, Mr. Speaker, to the Minister of Finance that what he is telling the people of Nova Scotia is, to deliver on his personal and corporate income tax reductions, he has to whack on a payroll tax on corporations, he is going to change the other tax structure. That is where the bucks are going to come from to put that in place.

Would the minister confirm to the House today that the entire administration of this harmonized tax system, the entire cost of the administration, will be borne by the federal government, and that also includes those people who are presently in the employ of the provincial government who are used as inspectors who, as I understand from the minister's statement the other day, some will still be employed?

MR. BOUDREAU: Mr. Speaker, I was just trying to follow the preamble and I was heading in one direction and the question came in the other. Let me answer, first of all, that we have no plans to introduce any tax measures that were not specifically referenced in the budget. That is it. We have no plans to introduce any tax measures . . .

MR. RUSSELL: You said that in 1993 . . .

MR. BOUDREAU: The Opposition, Mr. Speaker, has gone into serious election shock. The tension is building over in the Opposition ranks.

AN HON. MEMBER: You're nervous now.

MR. BOUDREAU: They are worried that the people of Nova Scotia will respond as we are sure they will to this massive program of tax reform. I fully admit as I had in the past, that the initial reaction of the people of Nova Scotia will be to scratch their heads and say, my goodness, a government in Nova Scotia reducing taxes, how could that be? But do you know what, Mr. Speaker? That's not an unreasonable reaction. (Interruptions)

MR. SPEAKER: Order. Order.

The honourable Minister of Finance has the floor.

[Page 1077]

MR. BOUDREAU: Mr. Speaker, the Opposition is getting quite excited today. I can understand why there is cynicism in the general public about tax reduction because it never happened when those people were in government. (Applause) The cynicism today about tax reduction is only a little bit less than it was about balanced budgets three years ago. The cynicism is only a little bit less.

Mr. Speaker, we will stand on our record of meeting our commitments in budget after budget after budget. We have met our commitments. We will put this program in place. It will be a sweeping program of tax reform in this province and our economy will grow and people will go to work. (Applause)

MR. SPEAKER: The honourable Leader of the Opposition.

COMMUN. SERV. - DEBRA STEVENS:

COMPENSATION NEGOTIATIONS - BREAKDOWN

DR. JOHN HAMM: Mr. Speaker, the minister is musing that the people of Nova Scotia are saying, imagine, a Nova Scotia Government promising a reduction in income tax but then they are saying, too bad it is the same government that promised us no new taxes in 1993.

My question is for the Minister of Community Services. Yesterday, when I asked the minister whether or not he was aware of any breakdown in the negotiations between (Interruptions)

MR. SPEAKER: Order. Order, please. Please ask the question again so we can hear it.

DR. HAMM: Mr. Speaker, it is to the Minister of Community Services. Yesterday, the Minister of Community Services, when I asked him, was not aware of any disruption in the negotiation process between his department and representatives of the Stevens family. I ask the minister now, today, after having an opportunity to be briefed, is he aware of any breakdown in negotiations between the Stevens family and his department?

HON. JAMES SMITH: Mr. Speaker, I just want to make the observation, in answer to his question, it is interesting that the Leader of the Official Opposition brings such a sensitive issue to the floor of the House of Assembly. I don't know if there is a breakdown in relationships with lawyers but I would report to the House, in answer to the question, that we have received correspondence from the lawyer and the interested party that the honourable member has mentioned that as far as he is concerned - my interpretation I haven't quite read it, it has been relayed to me - that negotiations, the process that has been set in place is still functioning.

DR. HAMM: I would remind the minister that this is not a matter before the courts, it is simply a matter of negotiations. The whole issue about victim abuse is sensitive, but I am talking about the resolution of a compensation package. He has now said to me that the whole process is still in place and still functioning. My question then to the minister is simply, is the minister then suggesting that the directive issued by the Premier on March 8th in which he ordered a speedy resolution of this problem, is that directive still in force?

DR. SMITH: Mr. Speaker, simply, the process is in place, it is proceeding and in due time there shall be something come from it, in one way or another. The directive that has been issued is one that was an encouragement that the process work. It is a simple matter. That is

[Page 1078]

as well as I can answer the question. I don't what the purpose is of the honourable member to bring this before the House today, but that is the answer and we are proceeding.

[4:30 p.m.]

MR. TERENCE DONAHOE: To find out if this poor woman is ever going to get a settlement! (Interruptions)

MR. SPEAKER: All right, now, the honourable Leader of the Opposition has the floor.

AN HON. MEMBER: Shame. Shame.

MR. TERENCE DONAHOE: Don't say shame to me. Shame on you for not (Interruptions) Shame on you!

MR. SPEAKER: Terry, be quiet. (Interruptions)

MR. TERENCE DONAHOE: And all of you too! (Interruptions)

MR. SPEAKER: The honourable Leader of the Opposition has the final supplementary question.

DR. HAMM: Mr. Speaker, by way of final supplementary, I will go to the Premier. Is the Premier prepared to assure members of the House that his directive of March 8th will in fact happen, that there will be a speedy resolution to this problem between the Department of Community Services and the Stevens family? Will he commit that his directive will be followed?

HON. JOHN SAVAGE (The Premier): Mr. Speaker, all I can say is that a resolution of such a matter depends on both sides. Our government lawyers are still working with the lawyer who represents Ms. Stevens, and we will continue to do so. I hope that the resolution will occur, but the resolution requires agreement on both sides. Rest assured that this government will continue to attempt to deal with Ms. Stevens in a humane and generous way.

MR. SPEAKER: The honourable member for Colchester-Musquodoboit Valley.

TRANSPORT. & PUB. WKS.:

HWY. NO. 104 WESTERN ALIGNMENT - WORKERS (N.S.)

MR. BROOKE TAYLOR: Mr. Speaker, back on April Fool's Day the Minister of Transportation told us, during his announcement about the Highway No. 104 western alignment, that some 500 people are working or are preparing to go to work on the construction of that highway. I wonder if the minister could tell us today how many Nova Scotians are working on the Highway No. 104 western alignment project?

HON. RICHARD MANN: I can't give the exact numbers, but I was told yesterday, someone reported to one of the MLAs that they are on 12 hour shifts, seven days a week, and there are actually two crews going. So I understand there are quite a number of people going and there will be more as the work spreads out. (Applause)

[Page 1079]

MR. TAYLOR: Mr. Speaker, I think the information the minister gave us is accurate; there are two crews working there. I wonder if the minister could tell the House why out of the 24 people working with power saws clearing a right of way for Tidewater Construction, there is a 12 man crew from Quebec, a 10 man crew from Newfoundland, and only two Nova Scotians are working?

MR. MANN: Mr. Speaker, I don't know that that is accurate at all. We have a contract with a company that is out doing work. The same with any contract that we have with a construction company in Nova Scotia, we do not interfere with that. They go to work and they manage their own affairs, as they will in this case.

MR. TAYLOR: Mr. Speaker, I think all members recognize and certainly realize that there are a large number of Nova Scotians out of work. Many of them are capable of operating a power saw and have done so in the past. Some of those individuals are on welfare and UI, and will not go to work because the private partner is paying such a low wage. That is the problem here.

I am telling the Minister of Transportation, because $55 million of the taxpayers' dollars is going towards that project, I am asking the Minister of Transportation, will he become personally involved and commit to Nova Scotians that he will look into this matter?

MR. MANN: Mr. Speaker, the member stands up here and cites this information as if it is the gospel. Two days before the Highway No. 104 announcement was made, that member opposite, and I believe the former Leader, the backbencher for the Third Party, put out a press release and said the cost of this highway was going to be $130 million to $140 million, that that was going to drive toll rates way beyond $2.00 per axle and $3.00 per car, and that is the gospel truth.

Remember the last session of the House, there were companies, he was rhyming off, that were going to go into ruin. He has not come back and visited any of those issues. I wonder why. Do you ever wonder why they don't come back and visit those issues, those truthful tales they tell of doom and gloom, and then you never hear from them again? That great reformer opposite wants me to stick my nose into the business of every private contractor in Nova Scotia. The answer is no.

MR. SPEAKER: The honourable Leader of the New Democratic Party, one question and one answer.

ERA - IMP PLANT (C.B.): WORKERS - PURCHASE

MR. ROBERT CHISHOLM: Mr. Speaker, time is running out for the employees Group Venture Corporation that has been formed to try to save the IMP plant in the Northside. I want to ask the Minister for the Economic Renewal Agency if he will commit to this House today to either himself or have one of his senior officials meet immediately with the employees that are spearheading this attempt to take over that facility and ensure that every attempt is made to retain that IMP plant and all its equipment and all those important jobs on the Northside immediately?

HON. ROBERT HARRISON: Mr. Speaker, on a number of occasions we have made this statement over and over again that we are in touch with the workers. We will respond to all of their requests as best we can within the capabilities of the Province of Nova Scotia and commit to do that today.

[Page 1080]

MR. SPEAKER: The time allotted for the Oral Question Period has expired.

GOVERNMENT BUSINESS

MR. SPEAKER: The honourable Government House Leader.

HON. RICHARD MANN: Mr. Speaker, would you please call the order of business, Public Bills for Second Reading.

MR. SPEAKER: All right, I will be glad to, but I am requested to allow an introduction first.

The honourable Minister of Natural Resources.

HON. ELEANOR NORRIE: I thank the Government House Leader for the opportunity to ask the members of the House to recognize in the east gallery, Mr. Jack Wentzell who is President of the Nova Scotia Christmas Tree Council and Randy Naugler, Vice President of the Nova Scotia Christmas Tree Council. They are in the gallery today and while I am introducing them, I want to make reference to the fact that Lunenburg County is the balsam fir Christmas tree capital of the world and it has been designated as such. Also, the county for 1996 has been designated the forestry capital of Canada. I would ask everyone in the House to please give them their usual warm welcome. (Applause)

PUBLIC BILLS FOR SECOND READING

MR. SPEAKER: The honourable Government House Leader.

HON. RICHARD MANN: Mr. Speaker, would you please call Bill No. 10.

Bill No. 10 - Regional Community Development Act.

MR. SPEAKER: I believe the debate had been adjourned by the honourable member for Sackville-Cobequid who had used up 15 minutes of time. He has 45 minutes left to go.

The honourable member for Sackville-Cobequid.

MR. JOHN HOLM: Well, thank you, Mr. Speaker. I think that the time clock that you have is a little generous now, actually, Madam Speaker.

MADAM SPEAKER: Actually, I will correct the record. It is 40 minutes you have left from my writing yesterday.

MR. HOLM: That is motivating to see if I can rise to the challenge of fulfilling that 40 minutes, however, I do not plan this afternoon to try to take that one up because the last day when I spoke, I had basically said all that I wanted to say on the bill. Certainly, if I could in the way of a brief summary, point out that this bill that is before us, in fact, in terms of the topic, regional community economic development, is one that is crucial to the Province of Nova Scotia. It is one that is kind of a buzzword that this government has used ever since they have taken office.

[Page 1081]

Unfortunately, this bill that is before us is more of a shell and it appears to be more of a public relations exercise and a top-down approach where all of the powers and authorities are resting with the minister rather than resting with the communities. Nor, unfortunately, are the resources committed in this bill or, in fact, from what I can understand, although I have not had the opportunity to do the detailed analysis yet, but certainly do not appear to have been done and provided for in the budget that has just been introduced.

Unfortunately, I think that this bill is a little bit more of that window dressing. Some people might suggest that it is time to get out there and paint your election signs, get ready as a result of the budget that was introduced today. Maybe the Liberal Party has already contracted their pollsters and the telephones will be zinging across the Province of Nova Scotia this weekend trying to find out if anybody has been hoodwinked . . .

MADAM SPEAKER: You are a long way away from the bill, honourable member.

MR. HOLM: . . . Madam Speaker, making things relevant because, of course, I never want to get on the wrong side of yourself. I think quite truthfully that the bill that is before us is all part of that same picture. The bill before us is really just one more facade. It is one more thing that they can hold up and say, look, see, we are genuinely concerned. We passed this legislation. Of course, don't look at it too closely, because if you do, you might realize that it is not going to be the solution that you hoped for, but certainly we are prepared at least to make the gestures.

Madam Speaker, when you take a look across this province, we have tremendous opportunities. We have people in this province who are second to none in terms of their energies, abilities and their creativity but one of the major problems has also been the destruction of the infrastructure system upon which many of those communities across this province depend. I talked briefly last day about one infrastructure that was at risk and which, in fact, shut down during the winter months, the MV Bluenose ferry. We could also talk about the fact that the infrastructure of the rail lines has been decimated. I don't blame this government, it was former Tory Governments, of course, that cancelled and allowed the removal of the rail service to southwestern Nova Scotia.

The list goes on and on. If we are to have genuine community economic development, we are going to have to ensure that we have more than the minister responsible for the spider web, ensuring that we are going to have telecommunications and that we have more than some Internet hook-ups across the province, but we are also going to have to have a strong infrastructure system in this province so that those who do develop the technologies, those who do have value-added products and resources that they wish to be able to get to market in an expedient and cost-effective manner, are going to have the way to do that, Madam Speaker.

There is a lot that needs to be done. I don't believe that this bill does it and I don't believe, unfortunately, that this bill really demonstrates the government's true commitment to the community-based approach because, again, everything really rests within the hands of the power of the municipalities, et cetera, you can make recommendations. The minister may or may not accept and establish such boards. Of course, without their approval, the minister can at any time decide to abolish those boards.

[Page 1082]

So with those few words, Madam Speaker, I will resume my seat. I know that a member has requested to make an introduction and before he does that, I will just announce that I am concluding my remarks on this bill and I look forward to both the introduction and also the comments from future speakers.

MADAM SPEAKER: The honourable member for Guysborough-Port Hawkesbury on an introduction.

MR. RAYMOND WHITE: Madam Speaker, through you and to the members of the House, this, I think, is the first opportunity I have had to introduce students from Guysborough-Port Hawkesbury. We have five schools represented: Troy Nixon and Stacey Skinner from Guysborough High School; Marcel Martin and Vance MacIssac from St. Mary's High School; Jonathan Durling and Todd Hendsbee from Mulgrave High School and the following group of students I had the pleasure to teach. They may tell you that I do tell the best jokes of teachers but I don't know if they will agree with that: Melinda Delory, Melinda Myatt, Derek Feltmate, Cory George, Stephanie Nickerson, April Greencorn, Carrie Beth Dobson, Christine Dixon, Clorice Grant, Shawn Greencorn, Sherman Keefe and Alicia Keefe. These students are accompanied by their teacher, Mr. Wayne Wier, who last week was recognized for his innovation in teaching and Pam Harrison, from the Guysborough County Regional Development Authority.

For the information of the members, they are here to participate in the Going Places Conference for young entrepreneurs and I would ask that they would stand and receive the usual warm welcome from the House. (Applause)

MADAM SPEAKER: The honourable member for Halifax Citadel.

MR. TERENCE DONAHOE: Madam Speaker, I am pleased to have the opportunity to address a few remarks to Bill No. 10, which purports to be an Act to Encourage and Facilitate Community-based Planning for Economic, Social and Institutional Change.

[4:45 p.m.]

I guess the initial difficulty that I experience when I read the legislation, Madam Speaker, is that it seems to run absolutely afoul of and counter to both what the government said in the election campaign of the spring of 1993 and, if I am not mistaken, seems to run counter as well to recommendations shared with the government, through the notorious 30-60-90 process.

You will recall, Madam Speaker, that the 30-60-90 process resulted in the production of a document of considerable moment and import. Many things were said in that document, among them a few pages were printed called Four Corners for Discussion. We have heard the minister who sponsors Bill No. 10 and the Premier and other members of government talking about Four Corners for Discussion relative to community economic development. One of the corners has a reference to remarks made to the 30-60-90 discussion sessions by one of the contributors. The advice was given to the government in the following words, "Government must let go and get out of the way.".

Well, I read Bill No. 10 and I see just the opposite. I see, frankly, not unlike the philosophy which is evidenced all over the Education legislation introduced here in this place last session, in Bill No. 10 an administrative structure and a set of structures and infrastructures, all of which ultimately, after they go around the loop, end up focusing upon

[Page 1083]

the minister and the ministry and a centralized bureaucracy. Frankly, the philosophy that the legislation is supposed to or intended to empower, which I think was the minister's word, empower the local community to make its judgments, really, in my opinion, with the greatest respect, is not reflected in the legislation at all.

Under the Four Corners for Discussion Community Economic Development document this particular government produced this document and suggested that there was a theme in relation to community economic development which it had learned about in the course of 30-60-90. The theme, in part, is described in the following words, "Nova Scotians, disillusioned by the failure of top-down economic planning and failed mega projects, want to take control of the economic future of their communities. They want to decide what will make their communities more effective, more vibrant, and more economically viable. They see Community Economic Development as the way to go.".

Then the document talks about the role of government. We have the statement made in the document that the people who offered an opinion on how community economic development might best work said, among other things, that the initiatives on the local scene should remain at arm's length, or more to the point, that the provincial government should remain at arm's length from the community economic development structure and make a commitment to take politics out of the process.

Well, the set-up established in Bill No. 10, as I read it, certainly runs absolutely counter to the suggestion that the minister and the ministry and the provincial government are remaining at arm's length from the community economic development structure. On the contrary, they are controlling and directing the structure in a very real way. Further, the minister holds the hammer in relation to much of the way in which the structure is intended to be designed and employed. It hardly indicates a commitment to take politics out of the process.

There were a number of specific suggestions made to the provincial government relative to community economic development. Among them, just as one example but I think a fundamental example and element of what we should expect to find is ahead in relation to community economic development is this. "Government should . . .", said the 30-60-90 document, ". . . provide core funds for administration, as well as technical services and professional support to volunteer CED groups, and project seed funds;" and, further, ". . . provide for community control of funding;".

I find it very interesting to note that in the budget just tabled here in this place today by the Minister of Finance that when one looks at the budget of the Economic Renewal Agency, one will find that in the fiscal year we now complete, 1995-96, it is forecast that some $7.146 million will have been spent on community economic development. I think it is noteworthy that we stand here and we debate Bill No. 10 and the minister suggests to us in this place and purports and attempts to suggest to the communities of the Province of Nova Scotia that this bill is important and significant in terms of community economic development.

You go look at his budget, tabled by Finance Minister Boudreau just a couple of hours ago, and find that the amount of money available from the Nova Scotia Economic Renewal Agency for community economic development next year is $5.446 million. By my calculation, that is a reduction of $1.7 million to be dedicated to community economic development.

[Page 1084]

I find it very difficult to lend any credence to any suggestion from this minister or anybody on the government benches to suggest to me or to anybody in Nova Scotia that this government is, in any way, shape or form, making an honest and a serious and, most important, a growing commitment to community economic development when last year they spent, according to the records of the Province of Nova Scotia, $7.1 million in support of community economic development and for next year, they decide to reduce that, not add to it, but reduce that by $1.7 million and they have budgeted some $5.4 million.

That $5.4 million is an awful lot of money and I don't scoff at that. What I do take issue with is the suggestion from this minister or from anybody on the government benches that that budgetary consideration or allocation represents anything but a backing away by this government, certainly on the financial side, from a financial commitment to community economic development.

A number of other things were said to this government about community economic development when it went through what some more cynical or critical than I talked about or have suggested was the charade of 30-60-90. They had some other suggestions made to them and among the suggestions is another suggesting that the provincial government should provide for community control of funding. Unless I have missed it, and I may have, I am not sure that I see in Bill No. 10 provisions here which make it possible for the local community to have the kind of control of the funding which, I have no doubt, was intended to be encouraged by those who made those representations to the provincial government.

I wonder if Bill No. 10 is more fluff than stuff really. There are quite a number of regional development authorities in the Province of Nova Scotia at the present time. Each and every one of them, and our caucus has met with many if not all, and each time we meet with the regional development authorities we find that the most dominant or frequent complaint is that they don't seem to be able to have people in the Economic Renewal Agency speak their language or communicate with them in a way that really makes it possible for them on the local level to identify activities of interest and economic importance in the local communities, such as to enable them to secure funding assistance.

We have operational regional development authorities, Madam Speaker, in Guysborough, Cape Breton, Colchester, Cumberland, the metro area and Halifax County - now part of the super-city - in Hants County, in Inverness, Richmond, Victoria; the Pictou Regional Development Commission, the Leader of the Opposition talked about the difficulties that they have had with the Economic Renewal Agency; Western Valley Development Authority.

The problem, Madam Speaker, is that the legislation, as Jimmy Johnson might say, while it talks the talk, it does not walk the walk. It is nothing more than high sounding, pious, lofty principles. As I have just said, the budget which Finance Minister Boudreau has just introduced indicates that there is $1.7 million less for community economic development next year than there was this year. The legislation itself ensures that the control is maintained by the minister or the ministry. It talks about the minister having, Clause 4, ". . . the general supervision and management of this Act.".

Well, my sense is, reading the day to day operational mechanical bits and pieces of this legislation, that the minister is going to have the general supervision and management of the day to day operations as well, or some official in his or her department. I don't level criticism necessarily at the current minister who may well be shuffled as soon as we rise from this place, or who may be there for many years, who knows. But this document, Bill No. 10, does

[Page 1085]

not, at all, I suggest to you, Madam Speaker, confer unto the local authorities the decision-making power, the expenditure decision-making power and the power to expend resources in a way that the government would have us believe, because it just simply does not turn that authority over to the local level.

Clause 5, "Such employees as are necessary for the administration of this Act shall be appointed in accordance with the Civil Service Act.". We already have men and women who are working at the local level in quite a number of Nova Scotian communities, Madam Speaker. So why do we have to get into worrying about such employees as are necessary to administer this bill? This bill should need virtually no administration because the day to day activity should be in the communities of Nova Scotia, which this legislation is intended to support and, to hear the minister and others, they purport will, in fact, support. I don't see that in the legislation at all.

The legislation sets out, quite frankly, I think, Madam Speaker, rather a bureaucratic maze. It really does set out a bureaucratic structure which, as far as I am concerned, is going to prove, in the long run, to be counter-productive, rather than helpful to economic development anywhere, let alone at the community level.

The principle, basically, of this legislation, as I understand the language of it, is that municipalities who want to adopt a regional development strategy can ask the minister to, Clause 6(1), ". . . establish a regional community development agency for the area covered by the regional development strategy.". When such a request is received by the minister, Clause 6(2), ". . . the Minister may, by order, establish a body corporate to be the regional community development agency . . .".

[5:00 p.m.]

Well, if there were a real commitment by this minister and by this government to community economic development, there is no question that it would not be provisional or discretionary on the part of the minister of the day. Again I say, not only to this minister but any future minister, it would be mandatory.

If there was a real statement which this government wanted to make to the effect that if a municipal unit or municipal units proposed to join together to develop regional community development agencies and they come to the minister and they say, we have, by way of municipal resolution or by-law or whatever, we have agreed to join together to form such an agency, well the minister, I suggest, Madam Speaker, if the legislation was really representative of a commitment to community economic development, really committed to community economic development on the basis of the joining together of the forces and the abilities of a multiplicity of municipal units, the legislation wouldn't make it discretionary in the hands or in the mind of the minister of the day, it would make it mandatory that such a regional community development agency, as is suggested in the legislation, would, indeed, be established.

The legislation is again furthering, as far as I am concerned, the control in the hands of the minister and the ministry. The minister is empowered under this legislation in the situation where a municipal unit or a group or a couple come to him or her, the minister of the day, to seek such an agency, the legislation provides the minister an authority to issue an order and the order would establish a body corporate.

[Page 1086]

Then, if you look at the seven or eight elements of the order to be made - keeping in mind again that it is the minister's order and not necessarily an order even which is reflective or supportive of the joint recommendations, which might have come forward from the municipal units to the minister - that such things as the term of office of the members and the proportions to which each of the participating municipalities shall contribute to the work of the agency and so on is all a part of the order - all of the part, I say, of the minister's order - so, again, it is the minister and the ministry which has control.

The minister, indeed, has an authority to de-establish an agency and to determine the matter of disposing of the assets of an agency. What are the terms and conditions? I note, unless again I have missed them, I don't see any terms or conditions upon which or in relation to which the minister must be satisfied, to justify the de-establishment of an agency which is established under the terms of the provisions of this legislation.

The role of the agency is described in this legislation, Madam Speaker. They can advise the council of a participating municipality; they can promote interest in activities of the agency; they can implement a strategy and an action plan; they can encourage interested groups; they can act as financial, industrial, promotional, marketing, training and planning advisors; they can encourage the formation of partnership groups; facilitate contacts; they can facilitate access and they can provide managerial, technical and so on; they can provide training; they collect, analyze and disseminate information; they can cooperate with governments and agencies and they can perform such other functions or duties as are assigned to an agency by the minister. Then, again, we have another example of the Minister for the Economic Renewal Agency being in a position to impose duties on these agencies which are established by him and by his ministry.

Why would it be that the Minister for the Economic Renewal Agency, who is telling us on the one hand and producing a piece of paper which purports to support the maintenance and control and direction of community economic development at the community level, why is it and where is the role and the function - more to the point - the justification for a role and the function of a Minister for the Economic Renewal Agency to impose duties or assign duties to the agency by the minister of the day?

I note, too, that the agency which is provided for in the legislation, Madam Speaker, is permitted to exercise various powers and they can in Clause 8(1)(a), "acquire by way of grant, gift, devise or otherwise funds to carry out the objects of the agency; (b) invest any money of the agency not immediately required for the purpose of the agency; (c) enter into agreements with the participating municipalities, the Province or the Government of Canada . . .", "(d) employ such persons as are deemed necessary . . . to carry out the objects . . . " and do such other things. Clause 8(2), "Subject to the approval of the Minister, an agency may make by-laws for the internal management of the agency and, without restricting . . . may make by-laws (a) respecting the conduct and duties of the officers . . .", the method of calling meetings, and respecting and so on.

So, again, we have evidence, Madam Speaker, of a control being exercised by the minister. Each time you look at a clause or a provision of this particular piece of legislation, if I do, and I know that many others who have looked at it and those many who are connected with regional development authorities across the province with whom I have had contact, have indicated clearly that at each clause of the bill and at every turn, we find language which runs counter to the notion that there will be control exercised at the local level.

[Page 1087]

The agency is under an obligation under the terms and provisions of this legislation to submit to the participating municipalities and the minister, audited statements for the immediately preceding year and any such other information and accounts as the participating municipality or the minister may require. So the minister, again, has a role and a form of control in regard to the accounts of this local agency.

What I don't really see here very clearly at all is any language which talks about an intent or talks about the parameters by which or through which it is the intention of this present government to provide financial support to the agencies which, if this legislation passes - as it surely will with the large government majority - where the commitment is and where the ground rules are under which and by which and through which the Government of the Province of Nova Scotia will provide funding to the community economic development agencies.

I don't notice either, Madam Speaker, that there is anything here that talks about the way in which the men and women who will be the members of the agency shall be appointed. It occurs to me - and we will have a chance at the Law Amendments Committee, I am sure to look at some language which may address that issue - that we may well be able to find language which addresses the matter of ensuring that the appointment of members of these agencies is done in such a way as to make it reasonable for us all to conclude that we have men and women who really do understand something about economic development and that we will perhaps at the Law Amendments Committee be able to improve the legislation in that regard. That principle is not really addressed in this legislation and it occurs to me that it should be.

The provincial government was told, or it was recommended to the provincial government during the course of the 30-60-90 process which the government for a while was saying was so important to it and one of the corner pieces of its economic development initiative, was told that government should take the lead in getting the three levels of government working as a team. I don't see any evidence of the Government of Canada involved in this particular initiative.

There is a general statement here that the agency, once established, could, Clause 8(1)(c), ". . . enter into agreements with the participating municipalities, the Province or the Government of Canada with respect to the funding of the agency;", but without some specific statement in the legislation that it is the intention of the Economic Renewal Agency and the Nova Scotia Government to fund any agencies as might be established under this legislation, I can guarantee you it will be months and months before the agencies, as are described in this legislation, are up and running because I will guarantee that it will be months and months working out arrangements and securing commitments from either the provincial government or the Government of Canada, certainly, to ensure that reasonable amounts of funding are made available to any municipal units which do wish to join together to establish the kind of agency as is contemplated by this legislation.

The legislation has an interesting clause, Clause 12(2), in which it says, "The exercise by the Governor in Council of the authority contained in subsection (1) . . .", subsection 1 being, Clause 12(1), "The Governor in Council may make such regulations as the Governor in Council deems necessary to carry out effectively the intent and purpose of this Act.", that the exercise by the Executive Council of that authority, ". . . is regulations within the meaning of the Regulation Act.".

Perhaps the minister might tell us when he closes debate on second reading why it is that, for instance, in Clause 12 or indeed anywhere else in the legislation there is not a statement which says either that the Government of Nova Scotia hereby commits financial support and funding assistance to the regional agencies as described in this legislation or even - less effective in my opinion, but even - that the Governor in Council shall make regulations as the Governor in Council deems necessary to carry out effectively the intent and purpose of this Act and then enumerate at least one and that is that the Governor in Council shall establish a funding schedule, scheme or program, whereby the municipal units which are dealing with this legislation once it passes, in fact, know that there is some chance of financial assistance from the provincial government. There is none in this legislation, as you will be aware, Madam Speaker.

[Page 1088]

The Liberal Strategy for Growth - Jobs for Nova Scotia, if you read that campaign document of the Liberal Party of 1993, you will find all kinds of high sounding principles about "let's move on . . . together" and "Jobs for Nova Scotia - A Liberal Strategy for Growth.". The difficulty I find is that the platform doesn't really jibe with the language and the rhetoric which we see in Bill No. 10. The Liberal platform says, "We believe that the community has a better knowledge of what its needs are, . . .", et cetera, et cetera. So we get a bill which says that the minister and the ministry are going to approve all of the relationships and the joining together of municipal units, the local people, and I am convinced will, over time, as these organizations are established, will control them.

If there were to be a statement in the legislation that once the commitment, which is also missing and should be in the legislation, but once the commitment to the funding of the regional agencies by the provincial government was established and committed by the provincial government, then if there was more specific and precise language to the effect that once established the expenditure-making decisions, the decisions as to which project or projects would be undertaken by the regional development agency are in the hands of the regional development agency, I think I would feel rather better about this particular legislation than I do. That kind of language is not there.

[5:15 p.m.]

The real power here resides, I repeat, with the provincial government, with the minister. If you look at Clause 6 and I will not get into a line by line reading, but if you just look at all of the principles established and all of the administrative and control mechanisms which are established and which reside in the minister in Clause 6 of the legislation, I do not sense at all that the agency established under this legislation is in any way, shape or form - more to the point, any meaningful way, shape or form - driven by the local level.

It is driven by the order of the minister and the minister is going to have control to name the agency, to determine the regional community in which the agency can exercise its powers, to determine the municipalities which will be represented on the agencies, to determine the number of members on the boards of directors to be appointed by the councils of the participating municipalities, the number of members of the agency's boards to be representatives of the regional community's economic sectors and other relevant groups.

The minister will make those decisions. The term of office and so on. The proportions in which each of the participating municipalities shall contribute to and provide the funds required to meet the expenses subject to the participating municipality's ability to approve its contribution on an annual basis. Where is the provision which says the proportion in which the provincial government shall participate financially and contribute to and provide funds

[Page 1089]

required to meet the expenses of the agency? There is no language in this legislation which imposes any obligation on the provincial government, once such an organization is formed, to require the commitment or provision or the transmission to the agency of funds from the minister or the ministry.

When one reads the legislation I say, again, one has to be pretty critical or cynical as to whether or not this is what we have heard talked about, whether this is in any way, shape or form a bottom-up kind of commitment to economic development. It is not at all, it is top-down. It is ministerial and ministry controlled and there is not even so much as a statement in the legislation that the minister or the ministry is, by way of legislative language or, indeed, no reference in the regulation-making authority that the minister or the ministry or the provincial government is in any way, shape or form committed or obligated to provide financial assistance. I repeat, we are looking at this legislation and we are debating in this legislation.

My colleague, the honourable member for Queens addressed this legislation the other day. He indicated - and he was proven to be absolutely right - during the course of his remarks something to the effect, I don't know whether he used exactly these terms, but he said that at the time he was speaking about this bill, realizing as I have suggested that there is no language here which commits the provincial government to provide financially to community economic development, my colleague from Queens said to this place, Madam Speaker, that we will watch on Thursday and we will find, I will bet, that there will be evidence of less money being dedicated by the provincial government to community economic development in the coming fiscal year than is the case in the year we are just now finishing.

If one looks at the estimates of the Nova Scotia Economic Renewal Agency under the heading Community Economic Development, we find there is a reduction of that commitment of $1.7 million. So, Madam Speaker, it is very difficult, if not impossible, for those of us who have talked to municipal councils and to regional development authorities and to men and women across all Nova Scotia - as our caucus has on a regular basis over the last couple of years - to really take this legislation very seriously as an effort to really make a positive assault in the area of community economic development.

Where is the promise, where is the language in this legislation that gives an undertaking or a commitment that there will be the requisite coordination of the provincial government departments and agencies and elements of the provincial government, so that it will be possible for any regional development agencies established under this legislation to have some realistic chance of success? Each and every time we talk to existing regional development authorities, we are told that they go into the Economic Renewal Agency and it is like going into some black hole and never coming out again, and they end up going around in circles across so many offices across the provincial government without having the kind of forceful and effective assistance which they require.

The legislation is, I suggest, Madam Speaker, a pretty pedestrian attempt to make it look as if there will be something happening at the community level. It has wonderful purpose clauses, but the problem is that once you get by a reading of the purpose clauses, you don't find the legislative language or the mechanics and, most fundamentally, you don't find the loosening of control by the minister or the ministry, which has been cried out for by the communities of the Province of Nova Scotia relative to community economic development; on the contrary, you find the heavy hand of the provincial government in a top-down administrative structure and not a bottom-up.

I know some people who have worked long and hard in the area of community economic development, who have made contact with me, have indicated that they are scared to death that this is just another mechanism whereby there will be another division or element of the Economic Renewal Agency that will tell people at the community level what they, at the provincial level, think they want them to do by way of community economic development.

That is not community economic development. It is not community economic development as defined by this particular minister, it is not community economic development as recommended to this minister and to this government by 30-60-90; and it is not community economic development as recommended and [Page 1090]

described to our caucus, to this minister, to anybody who would care to listen to them by existing regional development authorities and existing municipal units. It is a top-down process set out in this legislation and not the other way around.

I think I have to be a little bit suspicious of just where this government is coming from when it talks about community economic development, when it feels it necessary to suggest and set out a provision in its legislation that where there are employees necessary to administer this bill, they will be appointed in accordance with the Civil Service Act. My God, there are enough men and women, Madam Speaker, in the Economic Renewal Agency and other elements of the provincial government who, if this government was serious about bringing together men and women of ability, and they are men and women of ability, to administer and assist a legitimate community economic development initiative, this minister and his colleague ministers could find any number of men and women who are in the public employ right now who could be facilitators, not directors, of a serious and a legitimate community-based and bottom-up community economic development initiative. This legislation is not arm's length at all. It is another evidence of direction and control being exercised at the provincial level, rather than the community level.

So, Madam Speaker, I really do trust that it will be possible for us, at the Law Amendments Committee stage and at the further stages of debate and consideration of this particular legislation, to refine some of the language in this legislation, to inject into it or to provide in it something which I really think is a serious flaw that it is missing. It is fundamental. That is, a clear, definitive statement that the Province of Nova Scotia, which purports, by introducing this particular piece of legislation to be interested in community economic development, there is a statement which is not a discretionary statement, but a mandatory statement that once established, these regional development agencies will, in fact, by way of legislative edict, have access to financial participation by the Province of Nova Scotia. The bill is great at suggesting that the minister can tell the municipal units that they are going to have to provide financial assistance, but it simply does not impose that same obligation on the provincial level. I suggest, Madam Speaker, that that is a fundamental flaw.

Madam Speaker, I will conclude my remarks in regard to Bill No. 10 at this point. It is clear that I think the effort, in terms of the public policy issues addressed, started on a pretty good note in the purpose clause and then, unfortunately, went off the rails as to the logistics and the mechanics of how the process would be employed if, in fact, this legislation passes, and I think, as the following clauses and principles unfolded.

I think it is a pretty disappointing effort from a minister and a ministry which one would have thought, listening to their rhetoric over such a number of months, had a pretty good fix on what was going on, more to the point, what was not going on, with community economic development in the various regions in the Province of Nova Scotia. It is very disappointing that the bill does not seem at all to come close to vesting power and authority

[Page 1091]

and responsibility where this government has said, from day one, it proposes to have power and authority, and that is at the local level. It is far too much weighted in favour of the ministry and the minister and provincial government control. I have very serious reservations as to whether or not we will see meaningful community economic development on that basis.

[5:30 p.m.]

I would hope, as I have said, that when the minister closes debate, he would perhaps be prepared to indicate that, as we go to the Law Amendments Committee, as we go through the balance of the review process of this legislation, that he would be prepared to indicate that, yes, indeed, he would seriously and sympathetically consider language which would inject into this legislation a principle that the Province of Nova Scotia is a paying partner with the municipalities in the development of these regional development agencies. That he would give serious and sympathetic consideration to language which would remove some of the areas in which the minister and the ministry have an authority to exercise control and that he would give serious and sympathetic consideration to language which would make mandatory, and not discretionary, the commitment by the provincial government to fund, by way of some agreed formula, and, obviously, the formula could be set out in the regulatory regime established under this legislation, but that there would be a mandatory financial commitment to participation.

Obviously, in the context of a nearly 20 per cent reduction, or significant reduction, in the current Estimates for community economic development. This minister will, therefore, have far less capacity than perhaps I am sure he would like and far less capacity than the needy communities of the Province of Nova Scotia would like, to assist since this budget, which talks so much about saving the taxpayers of Nova Scotia. Well, it has some elements of that. It has some other elements whereby it is going to cost some many tens of thousands of Nova Scotians, and cost them dearly. In the area of community economic development, it just simply gives the lie to the suggestion that this government is serious in its commitment to community economic development.

So I will end my remarks in regard to Bill No. 10 at this point and look forward to, hopefully, some very serious improvement of the legislation at the Law Amendments Committee stage. Thank you.

MADAM SPEAKER: If I recognize the minister it will be to close the debate.

The honourable Minister for the Economic Renewal Agency.

HON. ROBERT HARRISON: Madam Speaker, you know it is interesting that the honourable member across ended his comments by talking about disappointment. There is a certain amount of disappointment on this side of the House in that it would appear that the criticisms coming on this bill from some of the members opposite are based on a total lack of knowledge of what is happening in the province at the moment.

There are 14 RDAs. They have strategic plans that are second to none. I would venture to say, based on the visitors that came here to a national conference, second to none in the country, in some cases. In fact, there were awards given to one of the Cape Breton elements of the plan the other day in an international conference. It would appear, although the member opposite talks about his caucus having visited with community economic developers and RDAs over the last months and weeks, that he has missed the point that what we have is already up and running, that the legislation that we are placing before the House today, through the Law Amendments Committee and through third reading was, in fact, built by the very RDAs we are talking about, along with the strategic plans, along with the commitment to train their people to create jobs and to create projects and investment opportunities.

When we talk about capital and the absence of a commitment to capital, I wonder and, again, I am experiencing a certain amount of disappointment if he missed what is a fundamental cornerstone in the budget announcement today. One of the most attractive schemes for creating investment opportunities in rural Nova Scotia was presented today by the Minister of Finance. It is as if the members opposite have missed either [Page 1092]

its importance or its significance to rural Nova Scotia. It is designed precisely to provide the kind of access to capital that is needed, which many RDAs are dealing with quite effectively, all ranges of capital, both with provincial and federal governments and with their local municipal units, through Cow Meadow, to venture capital funds. Here we have introduced today, in the budget, the very tool that has been missing for so long. It is hard for me to even imagine that the Opposition would be concerned about or criticize such an important step.

Well, I would love to hear the arguments opposing what was announced today. I did not hear any substantive arguments on this. What we kind of hear is what we think is going on out there. I wonder how many hours have been spent with the RDAs in discussion about their strategic plans. I wonder how many members opposite have read the 14 strategic plans that have been built by the communities of this province. I would challenge them to stand up and indicate whether they have read any of them, much less all of them.

What they would find in those plans is a commitment to ensuring that the local wisdom is finally brought to the table: the provincial, the federal and the community table. It is going to create job creation not only in metro if we look at the first ever partnership praised nationally for its ability to bring business and community leaders together, praised nationally for its ability to create jobs in this city. That is an RDA, that is one of the 14 RDAs in this province.

The member for Queens opposite said there was a commitment in the red book for a provincial initiative, an institute initiative. What we did was create 14 institutes. Those 14 institutes have created 14 strategic plans. He laughs at the plans that have been created by the communities and the leaders of this province. I challenge him to stand up and tell me how many he has read. I challenge him to stand up and insult those people from his seat on the quality of the work they have done to build strategic economic planning at the community level. I don't believe he understands, I don't believe he knows about them, I can't believe he has read them. He wouldn't be criticizing them if he had read them.

AN HON. MEMBER: Which member is that, Robbie?

MR. HARRISON: The member for Queens, laughing at the strategic planning, rural Nova Scotia.

The commitment to training was alluded to. The community college in Truro has built an entire resource bank using RDA officials, development officers. They are attempting to complete the training commitment that was made by this province.

The member opposite questioned whether there was federal and provincial money in the budget. What we will discover in estimates, of course, is that because of the creation of the access to information that was a cornerstone of community economic development, people in Yarmouth and Sydney had to have the same access to information that people enjoy here

[Page 1093]

in metro, so we created access centres. That access centre has been added to by nine different agencies of government, again announced in today's speech, so that we can streamline the approach to business in this province and to consumers. What we have done is taken a section of the budget that was formally ERA and Community Economic Development and assigned it to the new minister and the new department to make sure rural Nova Scotia has access to international sources of information, the finest data bases we can bring to them and one-window shopping, if you like, for the kinds of needs that they have in starting up businesses. (Applause)

In terms of additional commitments to funds, as the members opposite full well know, we are in the midst of negotiating with the federal government, our partners, by the way, in community economic development, a new arrangement for funding to ensure that communities have access to the funds that they need. Not only are we creating access to capital by guaranteeing using provincial resources for the ability of local businesses to find share capital that they need so desperately but we are also working with the federal government at the table, with the same long-term commitment to community economic development, to ensure that the project funds and the training funds and the business improvement funds are there.

What is fascinating to me is the Opposition, and in particular the former government members, who talk about top-down and community economic development must be grass roots. I think of the cronyism and the lesions of patronage that were part of the record of the previous government and what they called community economic development. What they managed to create in Nova Scotia was a multitude of agencies full of patronage appointments, full of cronyism; not community economic development, the ultimate in patronizing government down to the communities' economic development. What they can't see through all their travels is that it is local communities appointing local people, business leaders from all walks of life, from all political stripes, being appointed to lead their communities, the complete opposite of the political lesions that this province is trying to break itself from.

The cronyism and patronage appointments of the previous government did anything but instil a sense of grass-roots community economic development. What was the point in being enthusiastic about getting to the local area and making sure that you could grow an economy? What we have managed to do is within a budget discipline, making sure that within a budgeted, disciplined way, in terms of 14 RDAs, in terms of core funding, allowing communities for the first time in the history of the province to build their own holistic plans, strategic plans for community economic development and giving them the tools to work with, the federal-provincial access to capital tools that we have talked about today.

We are fulfilling a commitment to rural Nova Scotia by providing information, by providing an organizational structure, by ensuring that the world of opportunities is presented to communities that are prepared to make investments in their own future. We are doing everything that was committed to in the original plan, in the original campaign material, through 30-60-90, the so-called, much maligned consultation. There is total fidelity to the principles outlined in 30-60-90 and what the communities are actually doing. This government is permitting them to do so.

My final comment to the members of the Opposition that believe they have so much to add here is to first of all remind them that the legislation was built by those communities, that the strategic plans that those communities are putting forward are top-notch, first quality and are being responded to by this government and the federal government. I would simply encourage them to go out and read the plans and then talk to their own community leaders about how successfully their future will be planned. Thank you, Madam Speaker. (Applause)

MADAM SPEAKER: The motion is for second reading of Bill No. 10.

Would all those in favour of the motion please say Aye. Contrary minded, Nay.

The motion is carried.

[Page 1094]

Ordered that this bill be referred to the Committee on Law Amendments.

The honourable Government House Leader.

HON. RICHARD MANN: Madam Speaker, would you please call Bill No. 11.

Bill No. 11 - Children and Family Services Act.

MADAM SPEAKER: The honourable Minister of Community Services. (Applause)

HON. JAMES SMITH: Madam Speaker, it gives me pleasure to make a few introductory remarks as I introduce Bill No. 11, An Act to Amend Chapter 5 of the Acts of 1990, the Children and Family Services Act.

The legislation I tabled on April 4, 1996, seeks changes to the Children and Family Services Act. In so doing, we have listened to the Advisory Committee established under the Children and Family Services Act and we are acting on their advice. We are acting to further protect the children of Nova Scotia.

The Children and Family Services Act is a tool which government uses to assist families in trouble and distress. It has served the province well. However, it needs to be strengthened to allow us to accomplish our foremost goals, the protection of children and the strengthening of the family. We are expanding the law, strengthening it and broadening its reach.

The definition of neglect, Clause 1, Section 22(2) will be changed to allow intervention when there is substantial risk of harm. No longer will the social worker, teacher or police officer be forced to stand by until the harm is done, until they can see the bruises. Once the law is strengthened, it will not only better protect children, it will also be a tool of early intervention. In other words, Madam Speaker, social workers will be able to intervene before family circumstances deteriorate to the point where neglect has already caused physical harm. Support services, such as counselling, parenting education and other forms of assistance may be offered.

Madam Speaker, our children are vulnerable and we must act to protect them. Children who are victims of abuse will be further protected by other changes. Clause 2, Section 23(4) lengthens the timeframe in which a charge can be laid for failing to report abuse from one year to two years. Clause 9, Section 66(3) will be amended to allow the police and authorities in other provinces to access the Child Abuse Register. This will enable information to be shared across provincial boundaries and will assist in criminal investigations.

Madam Speaker, another set of changes I am introducing applies uniform standards to adoption. All adoptions of children by non-relatives will be subject to the standards we currently apply to adoption arranged by child welfare agencies. Those standards include a

[Page 1095]

home study and counselling regarding consent and information on adoption for all parties on adoption issues. All children and birth mothers deserve the same standard of care, the same safeguards. This change will provide that care.

[5:45 p.m.]

It should be noted that these amendments protect all parties: the child, the birth mother, and the adoptive family. I must emphasize that many private adoptions of non-relative children in this province would meet this standard of care. We are simply extending the safeguards to protect our children. I am also correcting a section of the Act that may be detrimental to the adoption process. Once children have been placed for adoption and an application for adoption has been filed, it should not be possible to have access orders made that could jeopardize bonding and attachment. The amendment to Clause 6, Section 47 will achieve this objective.

Finally, I would like to note the amendment to Clause 5, Section 36(3). This amendment assures that the Mi'Kmaq Family and Children's Services must be involved in all adoptions of native children. This change seeks to ensure that native culture and tradition is respected and considered when placing native children.

Madam Speaker, in my closing comments, I would like to commend the members of the Advisory Committee to the Children and Family Services Act, the staff of the Children's Aid Societies and district offices within our Department of Community Services and other organizations. It is because of their input and recommendations that this government is proceeding with the amendments that I have described. I thank you.

MADAM SPEAKER: The honourable member for Cape Breton West.

MR. ALFRED MACLEOD: Madam Speaker, it gives me great pleasure to be able to get up and share a few words with you on the Children and Family Services Act, Bill No. 11. Any issue that deals with children is a very emotional issue and, as a parent, as most people here in this House are, these type of issues are very important to us when we speak about them.

We all know there is nothing more valuable than human life but, when we speak about children, we have to remember that it is our responsibility to look after those people in particular. When we think about how innocent children are and they look upon us, here in the Legislature, to do what is right for people. When I say "those people", I mean our children and the children of our communities. As I said, it is an emotional issue and it is an issue that we have to be very careful when we deal with it.

I think that the intent of the amendments put forward by the Minister of Community Services are, indeed, good amendments. Our children are naive and they trust people. They are very trustworthy and they do not hold blame and they do not make anyone accountable. It is our job to make sure through the amendments that are put forward in this bill and the Act itself that we look after their interests. We must - each member of this House and each member of the society of Nova Scotia - protect the unprotected and I believe that is what this bill is about and I believe that is why the Minister of Community Services had brought forward these amendments. Children are, indeed, our most valuable asset. It is in the hands of our children that our future in this province will be dealt with. The minister has shown some leadership in bringing forward some of the measures that will make their lives more enjoyable.

[Page 1096]

The amendment to Clause 1, Subsection 22(2) is very important because this would allow people in authority, those in the know, such as social workers and police officers, to step in when there is a substantial risk of abuse. The current law requires that proof - physical marks or bruising or other bodily damage - be present before authorities can step in, and the amendments that we see here today will change that. We see what is happening everywhere else in our country, Madam Speaker. Our children are vulnerable and with the steps taken today, that vulnerability is just that much less. We must protect them. That is very important.

When we give the worker the authority to intervene, there also must be some support for these workers. If they are given the authority to intervene, when there is no concrete evidence, the worker may be in trouble with civil liberty groups and they may be vulnerable to actions taken against them. So if we are going to pass this legislation, we must support our workers and we must support them and the agencies in which they work if they decide to intervene. The reason we must do that is because we want them to be able to do the best job possible for that very important natural resource, our children. We must supply the support services to the workers in the agencies so that if and when a controversy arises, they will know that the support is there for them and they will not hesitate to take an action because they are wondering if they will be supported. The most important thing we can do is make sure the proper support services are there for the people who are in the jobs so that they can do the very most they can to protect the children.

The minister is well versed with respect to the Koster-Hillier report and the recommendations made. To a large degree, Mr. Speaker, these recommendations and changes that are recommended in this legislation, are in response to that report. The question is, does the government's response go far enough to implement these recommendations? That is what we have to deal with.

Mr. Speaker, the number one recommendation of this report dealt with the unmanageable caseloads of the workers in the system. I think that this has been confirmed by the Auditor General's Report in other areas of the responsibility of the Minister of Community Services. The recommendation suggests that caseworkers have a maximum number of 20 cases. With that kind of a caseload, the social worker can provide more support to the families and to the children at risk. Fewer children would have to be put into foster care and, as a result, more money would be available for other services.

Last year, 18 more workers were to be added, and while we introduced this legislation, the minister announced that there would be 18 more. I would like to take this opportunity to congratulate the minister. I did then and I would like to do it again, but we still have to ask the question, is that enough? We are on the right road, but is it enough? It is not really clear if these 36 additional workers are enough to meet the recommendation of the maximum of 20 people per caseload for each worker. I wonder if indeed there are numbers available and if the minister could supply such numbers, if that is accurate? Just how many children are at risk, Mr. Speaker? Do we know? Do we have a number? I am sure each and every person in this House is concerned about the number of children at risk and I know that the minister is doing everything he can to improve that situation.

With more social workers in the field and broader requirements to report possible abuse, I expect that the caseload will be drastically increased, Mr. Speaker. More and more cases will probably be identified. Are we ready for that? Have we the trained workers in place? Is this minister and is this government prepared to continue to meet the demand for additional staff when required? That is a question that has to be addressed because if we are going to bring in legislation to look after our children, if we are going to set down guidelines, then hopefully

[Page 1097]

it is more than just lip service because again, we are dealing with our most important natural resource, the children of our communities. I am sure and I hope that this government is sincere in making sure that the resources, human and otherwise, are in place so that this legislation can be enacted and can be followed through.

If this government is not prepared to do that, then this legislation may look good on paper but it won't be worth much to the children of this province. An old gentleman from Glace Bay used to say that a verbal agreement isn't worth the paper it is written on. Well an agreement like this, if the resources are not behind it, isn't worth the paper it is written on either. So, Mr. Speaker, those are some of the things that I know the minister will have to address in order to make this a successful project and to make this legislation successful.

Another recommendation that was indicated was that the department is very good about placing emphasis on assessing children at risk but falls short in developing a plan on what to do about the children who are at risk. Have training plans been developed is a question I would like to hear the Minister of Community Services respond to, and what protocols are in place to determine effectiveness of these plans? You know it is one thing to have a plan, Mr. Speaker, but if nobody goes around and checks the plan, if nobody has any quality assurances that the plan is being implemented, then, indeed, it may not work. The plan should have an objective and the objective should be what I would call smart objectives; they should be specific, they should be measurable, they should be attainable, they should be realistic and they should be trackable. Those are the ways that we will know whether or not our children are getting the best service possible.

Mr. Speaker, to suggest that the communication with the community is a priority but not build a model for that communication in this legislation was not the intent of the report. If we are truly going to make this system work, the community has to be involved, the community has to be part of the solution and not part of the problem. (Interruption)

Mr. Speaker, I would like to adjourn the debate until a future day.

MR. SPEAKER: The motion is carried.

The honourable Government House Leader.

HON. RICHARD MANN: Mr. Speaker, before we outline the business of tomorrow, I would like to call the attention of members to the east gallery where four young ladies are sitting. This is not, as we have seen so often today, members introducing bring your daughters to work, it is not that. In fact, these are four young Nova Scotians who are in town to participate in the Young Entrepreneurs Seminar, along with about 800 other young Nova Scotians this weekend, in a seminar partially sponsored by the Economic Renewal Agency and the Minister, the Honourable Robert Harrison.

I would be remiss, however, if I didn't point out that the attractive young lady on my left is my daughter. (Applause) Some suggest that she looks like her mum but, of course, most disagree with that. However, I would ask the four young ladies to stand up and receive the warm welcome of the members of the House of Assembly. (Applause)

Mr. Speaker, tomorrow we will sit at 11:00 a.m. and we will begin the day's business with the Opposition members responses to the Budget Address which we heard today. Following completion of that, the government may, in fact, conclude business and head off to a rousing annual meeting in Sydney.

[Page 1098]

With that, I move that we adjourn until 11:00 a.m. tomorrow.

MR. SPEAKER: The motion is to adjourn until 11:00 a.m.

The motion is carried.

Moving on to the Adjournment debate, the motion has been submitted by the honourable member for Sackville-Cobequid:

"Therefore be it resolved that the Savage Government cease and desist its hare-brained plans to privatize to a for-profit company the operation and management of correctional facilities as the potential savings do not justify the increased risk to the safety of the public and correctional officers.".

[6:00 p.m.]

ADJOURNMENT

MOTION UNDER RULE 5(5)

MR. SPEAKER: The honourable member for Sackville-Cobequid.

JUSTICE - CORRECTIONAL FACILITIES: PRIVATIZATION - CEASE

MR. JOHN HOLM: Mr. Speaker, I have to commend you. You read the resolution very well. It saves me from having to do so at the start. As I begin my remarks, I want to make sure of a few points, first of all, what we are talking about here in trying to ensure that the government will cease and desist from any suggestion or any thought about privatizing out the operation and the management of correctional facilities.

Mr. Speaker, nobody is suggesting for one minute, not myself or my caucus, and I have not heard it either from any of the correctional officers, I have not heard it from anyone who would be suggesting that, in fact, that the correctional facilities in the Province of Nova Scotia are adequate. I have not heard anybody saying that the current configuration is appropriate and that there is not a need to replace some of our old or outdated facilities.

I have not heard anybody saying that they are opposed to improving the efficiency and the quality of service, nor have I heard anybody saying that they would be opposed to the government getting consultation on better ways to improve the correctional services in terms of improving the quality of rehabilitation services and/or in terms of designing the kinds of facilities.

Mr. Speaker, that having been said, the very real concern exists, and the government has not said that they are not prepared to do this, in fact, all indications would appear that they are leaning more in favour of doing this, is that they are looking at not only privatizing maybe the construction of new facilities, but, also, privatizing out the actual operations and managements of those facilities.

As we are speaking, or maybe not actually as we are speaking, because maybe the discussions have already concluded, the government is carrying on discussions with two particular companies that have been shortlisted. Under their custody configuration project, in which the government called for proposals of interest, it is my information, and the minister seems to have confirmed it, that there are two companies that were shortlisted for consideration. One is Esmor Correctional Services, which is basically an American company. The second on is Atlantic Correction Services. I don't know the parties involved in that corporation. I have not been able to find out who they are. I did a trace on the Internet, the web site. I had the names pumped in and tried to do a search throughout the web. They do not show up, yet, Mr. Speaker. But of course, the minister promised yesterday that he would provide me with all that information.

[Page 1099]

Mr. Speaker, when one takes a look at the record and when one looks at the history of what has happened when governments contract out the operation and the management of correctional services, the picture here in Canada, the United States and, in fact, around the world has not been a pretty one. Once you are getting into for-profit corrections, a company aimed at making profits, they end up, generally, the record has shown, to try to cut costs by cutting back on programs, cutting back on the services that are provided, cutting back on the number of employees, cutting back on the training, cutting back on the wages, which results in all kinds of problems.

We have seen situations where privately run correctional facilities or jails have experienced riots, demonstrations in those facilities, Mr. Speaker. We have, and I tabled in this House yesterday, but one example, and I chose that one example because that is from one of the companies with whom the government is currently having the oral presentations. I might add - before I go into more details on the company, so I don't forget this point later on - that when the government announced and called for these proposals, they said that representatives of the workers, of the union, would be kept apprised and involved in the whole process. To their credit, the government, when they had their staff travelling around to view some of these facilities, they did take along some representatives of the correctional facilities.

When it gets down to the final part of it, as they are analyzing these two proposals, it is interesting that the government would not even allow representatives to sit in as observers. Now remember, correctional officers have a great deal of experience and they certainly have a great deal of interest in ensuring that those facilities are run in a safe and effective manner. Often their lives will depend on an efficient operation, as well as the lives and safety of those who are inmates in those facilities and, I might add, for the community at large if proper security is not maintained.

The Minister of Justice yesterday refused again to allow them to attend even as observers, and he said it was because they already have a preconceived notion; they already have a preconceived view and they are opposed to privatization. What that tells me is that the government also has a preconceived notion and their preconceived notion is one of privatizing it.

Just if I could, briefly, on that one particular company before I get into a few other things, and this was as a result of a two month investigation that was conducted following a riot that occurred last year in a prison; it was one for the immigration services in the United States where violence had broken out on June 18th. In that report and as a result of the investigation, the contract with that company was dropped, and they were no longer permitted to continue on; in fact, those who were kept in that facility were transferred elsewhere.

In the report they had, the report outlined a culture of abuse that had quickly developed at the detention centre run by Esmor Correctional Services of Melville. They found ample evidence that underpaid and poorly trained guards had beaten detainees. They went on to say that there was no real control exercised over the guards by their supervisors. The report, ". . .

[Page 1100]

laid much of the blame on Esmor's hiring of marginally qualified guards and giving them virtually no training.". It points out, ". . . that most guards were paid about $8 an hour.".

There is a very interesting phrase in the report. "The lack of training became evident during the uprising, when most fled the facility at the first sign of trouble, adopting an `every-person-for-himself mentality.'". This is one of the companies that the government is negotiating with.

If they privatize this, the government will lose control over the operation of those facilities. They will lose accountability, certainly the quality and standards will drop, and what this all has to do with is not trying to improve the quality of service, it has more to do with meeting Bernie's bottom-line budget figures. What the government is trying to do is have the new, as it knows, correctional facilities developed by another company who will carry the debt cost for those on their books. It will be the correctional officers, it will be the services, it will be the people who are in need of rehabilitation who will be paying that price for the profits of this company, and also I might say, the higher borrowing costs that that company will have to pay for the money to build those facilities because we know the province can bring them on and finance them at a rate that is at least 2 per cent less.

My time has expired. There is much more to be said so it is one that we will have to return to at a future day. Thank you.

MR. SPEAKER: The honourable member for Halifax Citadel.

MR. TERENCE DONAHOE: Mr. Speaker, I do want to offer a few remarks in relation to this particular resolution. There is, as I know you know and the Minister of Justice knows, a private sector involvement in the operation of jails, prisons and detention centres, particularly in the United States, for a number of years. The debate as to whether or not private sector firms can or should operate such facilities for the provincial governments and the federal government in Canada is attracting more and more attention.

Several substantial corporations and my honourable friend from the NDP has just indicated two corporations, mostly American, but not exclusively American, have in fact begun to undertake rather aggressive campaigns to persuade correction officials and legislators to privatize the task of incarcerating, maintaining and controlling adult criminals in our lock-ups, jails and prisons. These aspiring prison entrepreneurs, Mr. Speaker, invariably promise lower costs and superior performance. Those opposed to the privatization of our correctional facilities warn of a lack of accountability and they challenge the legitimacy of delegating what they consider - and may I say what I consider to be - such a central and fundamental societal responsibility. The debate is engaged and as a society, we must assess the wisdom or lack of same of investing in greater private involvement in corrections and incarceration.

There is a gentleman whose name is John D. Donahue, not the same spelling and no relation, who is an assistant professor at Harvard University's John F. Kennedy's School of Government. In a most interesting paper which I had occasion to read for another purpose some time ago, entitled Prisons for Profit: Public Justice, Private Interest, he suggests that we must consider three fundamental questions in this area: (1), Is incarceration the kind of enterprise which can be made substantially more efficient through innovation and tighter management? (2) How precisely can our governments assess the quality of private prison operation, monitor their performance and enforce accountability? (3) Can private prison contractors manipulate the community's perception of its needs for jail and prison services?

[Page 1101]

Now lest anyone think that these questions are theoretical and make interesting reading in an academic paper, let me remind you, Mr. Speaker, as you well know, that the issue of privatizing jails was made a rather political hot potato for the Premier of New Brunswick during that province's last provincial election and that the Minister of Justice in our province is right now, as has been indicated, wrestling with the question as to whether or not it is possible in his view and the government's view, to find a suitable partner to, as Professor Donahue said, ". . . improve adult correctional facilities, to ensure they are operated in a manner that is safe and secure for inmates, staff and, . . .", in our context, all Nova Scotians.

Speaking on that occasion during the provincial election in New Brunswick, Premier McKenna, some months ago, announced publicly that a previously executed agreement for the construction and operation of a correctional facility which his government had entered, had in fact been severed. The private sector partner agreed to go ahead with the design and the construction of the facility while, at the same time, "giving us" - the Government of New Brunswick - "more time for careful review of various options to arrive at a New Brunswick solution for the operation of the facility.".

Well, similar discussions are current here now, obviously, as the Minister of Justice has pointed out and one of the real reasons, of course, that the issue is gaining such currency across the country is the cost of incarceration and corrections here in Nova Scotia and right across the country.

[6:15 p.m.]

Now the proponents, Mr. Speaker, of private sector involvement in jails and prisons and correction facilities suggest that organizations such as theirs, confronting competition, will be more efficient than organizations which are secure against challenge, namely a public bureaucracy. The suggestion they make is that workers and managers in a position to benefit either directly or indirectly from efficiency improvements generally will be more energetic in reducing costs than those with no such prospects. And, so goes the private sector argument, lower costs in a competitive market generally will translate into lower prices.

Whether and how these basic concepts or precepts apply to the corrections issue depends, I think, first on the technical scope for efficiency gains in the task at hand and, second, on the nature and degree of competition in the incarceration industry, if I may call it that. So the question we have to face in this province and the Minister of Justice has to wrestle with, will private management offer durable efficiency gains and cost savings for the taxpayers?

On the other hand, there are those who are opposed or who have real reservations about private sector involvement. They suggest incarcerating people as an enterprise which has relatively little scope for resource-sparing, technical progress.

There is, admittedly, a range of alternatives to incarceration. The Minister of Justice and I have talked a little bit about those over the last couple of years; probation, parole, electronically enforced house arrest and monitoring, community service and so on. But once the task is defined as imprisonment, the range of alternative technologies seems rather narrow, indeed, I would suggest, Mr. Speaker. Prisoners must be sheltered and fed and cared for when sick, protected from each other and prevented from escaping. These do not appear to be the type of tasks that allow for major innovations in technique.

What of quality and what of monitoring and accountability? In most businesses quality is enforced by the customer's grasp of his own preferences and his freedom to abandon suppliers who let standards slip. In a few industries, where the immediate consumers are unable to evaluate or respond to quality, such as nursing homes and day care centres, there have been periodic scandals over deplorable lapses in performance. Prisoners are conspicuously unable, Mr. Speaker, as I know you know, to take their business elsewhere, however dissatisfied they might be with their circumstances. The customer, in this case, may not be the prisoner but the rest of the citizens who pay to have those prisoners locked up.

[Page 1102]

If the community wants the conditions of confinement to be short of luxurious but well this side of cruel and unusual, the issue becomes the standard set for prison operators, public and private and the community's inclination and ability to monitor conditions and to enforce its standards. If comprehensive contracts could be easily written, and I don't believe they can, performance could be perfectly monitored, and I don't believe it can, and promises costlessly enforced, and I don't believe they can, then private prisons would provide exactly the condition of incarceration which this and any other community would desire.

There are few objections, Mr. Speaker, I suggest to private involvement in corrections that cannot be answered by calls for careful contracting and rigorous performance evaluation. If contracts will be perfectly enforced, the potential efficiency gains need not be very great to grant privatization a measure of appeal. But, as I have said, will private prisons be adequately monitored? And what of manipulation of the community's perceptions? The question is essentially whether and to what extent public opinion on the need for jail and prison services can be altered by outside pressure and persuasion. A fully developed incarceration industry would surely support one or more trade groups with high-minded names that would publicize crime statistics, contribute to campaigns for tough sentencing laws and support law and order candidates.

Many have argued that private prison operators will certainly lobby on their own behalf. That does not necessarily mean that they could manipulate public opinion and the law-making process as easily as their opponents might suggest. Well, perhaps not.

To conclude, Mr. Speaker, many are concerned that the prospect of profit-motivated groups, urging the community to deprive of liberty its delinquent members, as repulsive enough to make objectionable even a small chance that such lobbying would succeed. Are private prisons a good idea? Probably not, in my opinion, Mr. Speaker.

I believe, as I said in this place on an earlier occasion, it is not unreasonable for us and for the Minister of Justice to look at private involvement in the construction and, indeed, the physical maintenance of jails and lock-ups and correctional facilities. But I have yet, on the basis of what research I have been able to do, to come to the conclusion that it is appropriate, or in Nova Scotia's contemporary society, desirable, to have the confinement and the control and the management and the discipline on a day-to-day basis of those who are incarcerated in the hands of a for-profit corporation. Relative to this resolution, I urge the Minister of Justice to ensure that he and his colleagues in government come to that same conclusion. Thank you.

MR. SPEAKER: The honourable Minister of Justice.

HON. WILLIAM GILLIS: Mr. Speaker, I want to thank the honourable member for Halifax Citadel for his contribution to the debate. I think it was well reasoned. I don't know if I necessarily agree with all the points, but he certainly took time to do some research and

[Page 1103]

raise some questions. On the matter of providing correction services, obviously there are many questions. It is not all black or white. I think if we were to look at options, including privatization, then you must look carefully at that and look at the pluses and minuses and, like anything else in life, there are those.

We are speaking on a motion, as we all know, that was brought forward by the member for Sackville-Cobequid. Unfortunately, he had to leave the Chamber. He told me he had other commitments and I understand that. I must say some things in response, of course. The matter of public perception. I think it should be mentioned for the record that Shaping the Future, the document released by the Minister of Finance recently, is based on consultations, based on approximately 3,300 survey responses, excluding a bulk 1,700 that came in together apparently, and they are broken down separately here. I think the 1,700 were basically 1,700 to 0 against privatization. But for the 3,300 that presumably came from the general public, it was roughly 50/50 in terms of whether or not there should be privatization or it should be looked at. It was certainly not a scientific survey, but that gives us a little bit of flavour.

To go on, I want to just mention in response to a question yesterday so that we have as full a disclosure as possible. The member for Sackville-Cobequid asked about the other companies involved, the Atlantic Corrections Group, who are one of the two companies that are vying to be the preferred supplier under the Cooperative Business Solutions process, which we are going through. I was asked for that and I am going to table that. The three corporations are: the Bracknell Corporation, headquartered in Toronto, a Canadian publicly held company which employs 50 people in Nova Scotia; Management and Training Corporation, headquartered in Ogden, Utah, is a privately held firm which is the fourth largest operator of private correction facilities in the United States; and the third partner is SNC-Lavalin Inc. headquartered in Montreal and, as members would know, a Canadian publicly held company which employs more than 70 people in Nova Scotia. I also want to mention that the proposal of Atlantic Corrections Group identifies subcontractors, but these can change, as agreed, during negotiations. This is the basic group and I want to table that so it is available to all members.

A couple of other things I just want to mention, Mr. Speaker. The member for Sackville-Cobequid, in talking about privatization, quoted from an article which related to one of the two companies that is on our shortlist and is being considered. Who knows what will happen? In any event, he mentioned that companies had problems as reported, and other private companies have had problems in operating facilities. He specifically mentioned riots and other troubles. We all should realize that publicly operated facilities have these same problems as well. Nobody is immune to it and although personally I have said, if we can stay in the public sector, that is where we will be, let's not kid ourselves, because we are in the public sector or in the Country of Canada or in the world, that doesn't mean that publicly operated facilities are excused and are exempt from all problems that can beset a facility, I just want to make that point.

In terms of our CBS process, so there is no misunderstanding, we have gone through a carefully prepared process over the past number of months. We called for proposals relating to correctional services and our objectives are to have a safe working environment, space for rehabilitation, have a program that we can afford and come up with locations in the province that will serve our population, serve the courts and so on. These are our objectives and we have advertised under the CBS process.

[Page 1104]

We had a number of proposals come forward, I think it was approximately six. After careful consideration and with a board those were weeded down to two and there was an oral presentation which concluded earlier today from two companies, one was Atlantic Corrections and the other was Esmor. From there a decision will be made based on a decision to come up with what we call a preferred supplier. That decision will be made by senior public officials, we have a deputy minister sitting on that committee, we have the head of corrections in Nova Scotia. The honourable member for Sackville-Cobequid said, it is important to have somebody who knows corrections. Well, Mr. Honsberger has had 25 years in the corrections field, has served on the front lines. He knows what is happening so you are not putting somebody in there who is not knowledgeable. I think you have to look at that, it is not as if you are taking some academics or somebody who had no experience in this particular matter.

So, we think we have a good process and in the next month or so, we hope to make a decision on this preferred supplier of the two companies that have applied, that have been shortlisted. Now maybe neither will be suitable but maybe one will be and then when that happens, then we will work with the preferred supplier to determine the type of institution we need to style for rehabilitation and safety, the number of institutions and locations. Again, that is another step along this road to improve our facilities and as both honourable members indicated, we all know that we need improvements, one of our nine adult facilities goes back to 1872, we have to make changes.

Further down the road, we will make a decision on how that might be done. It is possible that it could include some privatization in terms of operation. It might have no privatization in terms of operation. It might be, as some members have suggested in the debate, where you would build and lease to buy or it might not have any of those. If we can find a way to do a better job in operating our facilities in terms of management and the labour component, maybe we can continue to work together to compete and meet some of those challenges.

That is where we are and what will be decided with one of these two companies, if one is selected, it doesn't mean there is privatization. It means that we will go another step to see how we can improve our facilities and make them better in terms of Nova Scotia. So that is the general outline, I have talked about the general requirements we have. But the objectives we have do not include any reference to privatization. We do not have a goal that we are going to privatize but of course, we don't rule it out because it might be something we have to look at.

We have to try to meet our objectives, as I have mentioned earlier and if possible, we will operate them in the public sector if we can do it. If we can't do that and live within our means, we must consider other options. That might include, as I said, a partial operation or maybe building and lease to buy which would have the facilities provided. There would only be private operations if a significant business case can be established that would be required to meet our budget objectives and the human resources issue be addressed. That is crucial that we have a staff of correction officers, some of them have worked in the field for a long time and they certainly can't be just ignored. Whatever way we go we have to be considerate of the corrections officers under the union headed by Mr. Foulkes, it is really important that we do that and we have every intention to do it.

I want to make this commitment before I take my place, the government has and will continue to work with the staff of the union and the NSGEU. The NSGEU has travelled with us to look at some other facilities, although we were not able to have the union sit in at the oral sessions yesterday and today and certainly not take part because we try to have people

[Page 1105]

with no fixed agenda. We have people from other departments than our own who have an open mind to try to look at this.

[6:30 p.m.]

Having said that, it was in the past month that the Premier met with Mr. Foulkes, the head of Local 480, I have met with Mr. Foulkes several times in the past number of months, including in the last six weeks. I have a standing offer in a reasonable time when we can get together and talk about these so we can overcome any difficulties and have communication as we go along so there are going to be no surprises. We have to look at all the options and we will keep the employees informed and we will try to do what is right for the people of Nova Scotia. Thank you.

MR. SPEAKER: That concludes all the speakers on the adjournment debate. The House will adjourn until tomorrow morning at 11:00 o'clock.

[The House rose at 6:31 p.m.]