HALIFAX FRIDAY, APRIL 12, 2013
COMMITTEE OF THE WHOLE HOUSE ON SUPPLY
Ms. Becky Kent
MADAM CHAIRMAN: Order, please. The Committee of the Whole House on Supply will now come to order.
The honourable Government House Leader.
HON. FRANK CORBETT: Madam Chairman, would you please call the Estimates of the Department of Economic and Rural Development and Tourism.
MADAM CHAIRMAN: The honourable member for Cape Breton North.
MR. EDDIE ORRELL: Mr. Minister, in the Budget Speech the jobsHere program is to help small businesses get started and they're going to introduce a single window, to streamline access to current small business programs, ensuring that business owners can easily find and connect with the help they need to grow, hire and succeed. Can I ask when that is going to take place, is it going to take an implementation period, and how long is that going to take?
HON. PERCY PARIS: We have already streamlined the Web portal. What we've done is we've got five buckets there and we found that in the past when clients or potential clients were looking for information about the programs that were available, they had to do a lot of searching to actually find what it was that they were seeking.
What we've done is we now have five buckets. That has already happened. All the programs that we've had previously still exist. I will add that when it comes to moving ERDT forward and being - I'll use the term more user-friendly - that's a process that will be ongoing. We will always be looking for ways that we can improve upon, enhance what we've got so that the general population and business population can take full advantage of all the goods and services that we provide.
MR. ORRELL: Also in the Budget Highlight Speech, they're talking about decreasing the small business tax to 3 per cent from 3.5 per cent and lowering the threshold to $350,000 per business. It says in there that the combined impact of these reductions, 93 per cent of the small businesses are going to save money. The other 7 per cent that aren't included there, that are going to be making more than that threshold, what does that mean for them?
MR. PARIS: I will try my best to answer the question, which is truly a Finance question and the Minister of Finance would be in a better position to answer that question than I. When we reduce the small business tax for companies, our goal as a government is to encourage as many small businesses as we possibly can to take full advantage of that, to be involved in the Province of Nova Scotia. Certainly what we have at ERDT for the small percentage that do not qualify or cannot take advantage of the small business tax deduction, we have an enormous cluster of other programs and initiatives that would be available to them.
One of the things we have done and we like to do at ERDT, we want to ensure that all of the diverse companies that we have in Nova Scotia and the small- and medium-size companies, businesses, that can avail themselves of all the services that we do provide. We put a real emphasis this year on small business and I think that the proof would be in the PIP initiative, the Productivity Investment Program. We recognize that small businesses are a vital part of the Nova Scotia economy and we are very much committed to assisting them to grow and be sustainable.
MR. ORRELL: If we are really truly trying to take full advantage of that, would it not have been better to decrease the tax rate and either maintain the threshold or increase the threshold instead of lowering it?
MR. PARIS: Madam Chairman, again, the small business tax credit truly comes under the mandate of the Minister of Finance. Our role, when it comes to small businesses, is making sure we create the right environment in Nova Scotia for small business to prosper here in the province.
Certainly small businesses, those companies with more than 100 employees, we know they make up 98 per cent of business here in Nova Scotia so we see them as being very vital to our economy. That's why we have clusters of initiatives that will be of assistance to them. One of the things, when we talked about the Web portals, when somebody connects, if they want to talk to a voice, to a person, we certainly make that happen because it's very, very important for Economic and Rural Development and Tourism to have that direct contact.
I won't say we do hand-holding but certainly what we will do is we will walk alongside any entrepreneur, especially those that are small- to medium-size businesses. When they reach out to us and we reach out to them, we do make that connection because we want to ensure that small businesses thrive and survive in Nova Scotia.
MR. ORRELL: We are hearing from some of the small businesses, especially in my area, that lowering the threshold is probably going to negate the 0.5 per cent reduction. If we hear enough through us and through you, would you bring that back to the Finance Minister and possible look at reversing the decrease in that threshold?
MR. PARIS: In response to that question I will say that within our government we are always continuously communicating with one another, that this government has been built on a foundation of working collaboratively with all the various departments. Small businesses, medium-size businesses, large businesses, we pride ourselves on being very open and very receptive around sitting down, talking to and discussing.
We have some programs that are 100 per cent accessed by small- and medium-size businesses. One of them is the credit loan program, one of the initiatives that we run through the credit union, which is 100 per cent for small business. There are so many of them that I'll just read off a couple.
The Nova Scotia Business Development Program is another program that's 100 per cent accessed by small business; the credit union high risk commercially viable lending program is 100 per cent accessed by small business; I mentioned in a previous answer this morning the Productivity and Innovation Voucher Program which we refer to as the PIVP, which is again 100 per cent accessed by SMEs; there's the Community Economic Development Investment Funds, which is more commonly known as CEDIFs, 100 per cent accessed by small business; the Immigrant Small Business loan Program, another one that's 100 per cent accessed by small business; and the small business growth program. For anyone who could potentially fall through the cracks, we have other initiatives that could provide that safety net, other programs that they can access and make use of.
MR. ORRELL: We'll change gears a little bit, Mr. Minister. We're hearing a lot about payroll rebates the last little while, about different loans being given to different companies. I guess my question is, of the payroll rebates that have been issued that have reached the end of their term, what percentage of the companies achieves the maximum full-time equivalents?
MR. PARIS: We don't have, certainly not at our fingertips - and I know NSBI is in the gallery, our payroll rebates are administered through NSBI. I certainly don't have that at my fingertips, nor does the deputy or our financial department - we don't have that sort of data. I will request that NSBI, if they have that data, if they could make it available, they will. Payroll rebates, as I'm sure the member knows, are only paid in arrears. We never lose money on our payroll rebates, despite what some individuals may think, and I'm thinking more probably in the public domain, but because they're paid in arrears, in other words, in order to get the payroll rebate the recipient of the rebate has to reach - and I'm going to use the word "targets" or milestones. And I know the member for Glace Bay gets a kick out of it every time he hears the word "targets" but that is the way the payroll rebates work. They're always paid in arrears, never in advance of.
MR. ORRELL: Thank you, Madam Chairman. If you're getting NSBI to get those numbers for me, I wonder if I could ask, what percentage of jobs are actually created versus those that may be announced when the deal is actually signed?
MR. PARIS: Madam Chairman, through you to the member for Cape Breton North, part of the request this morning to NSBI would be to give us some more documentation with respect to the question. I have to say, since payroll rebates have hit the floor, payroll rebates are a very vital tool for us to offer that incentive for potential businesses to come here to the Province of Nova Scotia, and in many cases payroll rebates have been, if I can use the term, the product of sealing the deal. They have been very, very helpful.
We can't offer some of the incentives that other jurisdictions offer. Certainly, there are jurisdictions around the world that have built facilities to try to entice businesses to their jurisdiction. We don't have those kinds of pockets, but certainly the payroll rebates work very, very well for us. We did an analysis recently about the payroll rebates, and we found it to be a valuable tool. We did an analysis of payroll rebates by a third party. If the member recalls, I was the one who requested that analysis because as minister responsible, I have an obligation to taxpayers and to companies to make sure that we are spending our money wisely and that we are getting our money's worth from payroll rebates.
MR. ORRELL: Keeping with NSBI, new and retained payroll was actually $92 million versus a target of $130 million. Is there any reason why this target hasn't been met?
MR. PARIS: One of the things that NSBI does, and I might have mentioned this yesterday, is they are prospectors. They are always out there prospecting for new business, potential business, regardless of where they are, to either start up, come to Nova Scotia, to employ more Nova Scotians. I will say when it comes to payroll rebates - and I mentioned in my previous response to a question, we did a third-party evaluation of payroll rebates. Gardner Pinfold Consulting was the third-party evaluator. They looked at NSBI actuals when it comes to payroll results achieved during the period of 2007 to 2012 and it indicated that $1.2 billion of direct payroll was achieved. Part of the member's question is - I know NSBI is already busily collecting more information for the member opposite.
MR. ORRELL: The information that I had on that came from NSBI's 2012-13 annual report from their Corporate Scorecard summary. Also on that scorecard summary, the average gross salary of new jobs created was targeted to be $45,000 per person, if the actuals were right, but it was only $38,000. If they are supposed to be good at creating high-value jobs, why aren't these targets being met?
MR. PARIS: I have something here in my hand with respect to NSBI, with respect to payroll rebates, and it goes back to that commission request that came from me directly about payroll rebates: the results of the Nova Scotia Department of Finance's Input-Output Model, and again the Minister of Finance certainly knows more about this than what this member does. It has been utilized to analyze the economic impact analysis over the past five years and it did demonstrate that a positive impact was felt right across the entire province: 47 per cent of employment was created outside of HRM; 37 per cent of payroll was created outside of HRM.
Over the past five years, for every dollar invested by the Province of Nova Scotia through NSBI, the return on investment, or as they refer to in finance as the ROI, for the province and to the taxpayer was $1.43 billion in provincial tax revenues, or 43 per cent.
We do have some information about payroll rebates and they have been proven and determined to be a very effective way for Nova Scotia to grow its economy. Part of that economy is attracting new business, keeping existing businesses here, assisting businesses to grow that are here in Nova Scotia, and the bottom line is hiring more Nova Scotians.
MADAM CHAIRMAN: The time allotted for the Progressive Conservative Party has elapsed. The honourable member for Glace Bay.
MR. GEOFF MACLELLAN: I'm going to get to some line-by-line items and ask some specific questions on the budgetary lines, but I do want to ask the minister a question first on a file and a program that is of great importance for all of the members of this House, certainly, and across the province. It's something that is, particularly if you live in a rural economy, sensitive to changes and alterations, whether it be public spending or obviously the growth of the private sector of the economy, you feel those little effects.
Some of the things we have felt - certainly in Glace Bay and I think a lot of the members will attest - are changes that have taken place with respect to student employment programs. I know that there are a couple of streams under the departmental budget and the ERDT - Strategic Cooperative Education Incentive, Student Career Skills Development Program, and of course, the Cooperative Graduate Placement Program. To start off in terms of the financial implications of those programs, can the minister tell us what the allotment for that was in the 2012-13 fiscal year versus what it looks like for the upcoming fiscal year?
MR. PARIS: The line item for estimates last year is unchanged; the number is the same so it's unchanged. We've recognized the importance of us maintaining, as a government, those initiatives directed towards student employment. I think it becomes pretty evident. I know that when it comes to the Spring and it comes to allocation of funds under the various initiatives we have under the student employment programs, there is probably not an MLA in Nova Scotia who doesn't get a phone call from somebody inquiring about getting a student this year. Is it going to be the same number as last year; or, I didn't get a student this year, could you run some sort of interference or make a phone call to the minister's office or to come across the floor and talk to the minister? We've been eliminated, or we didn't receive our funding or we missed a deadline or whatever the case may be.
I think the student employment initiatives that we offered to the province are vital. Again, it's about us changing or continuing to invest in our youth. There have been times when we all know that student employment initiatives have led to full-time employment. We've maintained it and we are maintaining it this year at the same level of the previous year so there will not be any reduction.
MR. MACLELLAN: With respect to those, can the minister shed some light on the regional breakdown as in how those dollars from the province are allocated by region? Is it a regional priority? How are those funds disbursed throughout the province?
MR. PARIS: I think one of the things that I would like to think I've built a reputation on as a minister that probably is more evident within the various departments and it's one of fairness and diversity. What we have done over the last, certainly while I've been the minister is that when it comes to the allocation of student employment, we try to be inclusive and be as fair as possible.
I don't have the regional breakdowns but that's something, again, staff are here in the gallery and they will make note and we will get that regional breakdown to you as soon as reasonably possible. Now, depending on what time we finish today, it may be today and if it's not today, it will be Monday. What I can say to the member opposite is that inclusion is a very large part of my makeup and I ensure that every time staff come into my office, or I go into their office, whether it be about a program or anything associated with ERDT, one of the first conversations we do have is around one of inclusion, to make sure that it's a fair process and that we've got fair distribution as well.
MR. MACLELLAN: One final question on the student employment programs, is there a relationship, a correlation between federal funding for that program? I know the resumés are rolling into my office now and people get pretty eager to get out there and hit those potential not-for-profits or those businesses that have openings for summer employment.
I just want to ask the minister, is this impacted in any way by federal funding; for example, if the funding decreases, is there a change in how the regional breakdown, those funds are allocated? If there happened to be - I know there won't be, but hypothetically, if there was an increase from the federal funds - does that change the landscape or is the provincial program very specific with where the money goes and the federal allotment is something that's unrelated?
MR. PARIS: We work very closely with the federal government. Our goal is to maximize the greatest benefit possible for Nova Scotians. I can assure the member for Glace Bay that we are continually at the table with the federal government when it comes to - in particular reference to initiatives that are co-funded. Our goal, as we go down any path that involves the federal government, is that Nova Scotians don't lose out in any way, shape or form.
While I do have the microphone, I'll provide this and I'll ask the Page to photocopy this for the member opposite. What this is, for the member, it's a regional breakdown of the Student Career Skills Development Program so the Page will be more than happy to make sure you get a copy of that. I'll ask her to give a copy to both members.
MADAM CHAIRMAN: I would also ask the honourable minister to table that so that is available to all members of the committee.
The honourable member for Glace Bay.
MR. MACLELLAN: Thank you, minister. I'll get a chance to take a peek at that and if there's anything before the hour, I'll certainly bring it to your attention.
I want to jump back into some of the estimates and I'm going to draw your attention to Page 6.5, just a very quick question under the Productivity and Innovation segment. Something that jumped out at me and I'm assuming there is a logical explanation for it, but I remember last year on some of our exchanges on estimates, some of the questions that I'm always concerned with is the importance of sector development and how you identify your core competencies in terms of what sectors are available for Nova Scotians, from a private sector and certainly from a public dollar perspective, where we support and where the help is needed most.
Under the Programs and Services line right at the bottom, there are two lines: Office of the ED, and Innovation and Learning Programs. The bottom line item, Innovation and Learning, used to be in last year's budget. It was a group of, I think, very important headings. There was workforce initiatives; eNovaScotia; sector strategies and analysis, which we talked about at length last year; innovation and learning; innovation and business competitiveness; sector development, which was also a topic of extensive discussion during the estimates last year; and finally, workforce initiatives and entrepreneurship.
It looks like all of those functions have been combined and they fall under Innovation and Learning Programs. I just want to first verify if that's correct and if so, what was the reason for the change to make that line item much more general than it had been?
MR. PARIS: To give the member for Glace Bay comfort, they are basically the same programs. The programs are the same and part of what we've talked about earlier was about how we have streamlined things at ERDT and how we are doing some more in the way of efficiencies. It's basically the same thing. We haven't eliminated or deleted.
MR. MACLELLAN: Madam Chairman, thank you for that clarification. If I could draw your intention now to Investment and Trade, Page 6.7. I just want to start the conversation on this. Obviously this is a very significant portion of the budget. The line items that seem to be a similar thing - investment and the former IEF, the Nova Scotia Jobs Fund - there's $17 million for Investment under the Nova Scotia Jobs Fund. Can the minister explain just a bit of a distinction, which one is which? We're certainly familiar with the genesis of the Jobs Fund so that line item is very clear, but what is the investment portion under that subgroup and what sort of functions do they provide that are distinct from each other?
MR. PARIS: That is mostly capital investments under PIP. Under this government, PIP is a relatively new initiative and a very successful initiative, I might add. PIP provides that opportunity where we as a government - taxpayers invest in businesses, they invest in employees, and they invest in businesses so that business can become more productive, more competitive, and compete globally. The capital investments are ways that companies have invested in their individual company technologies, with assistance from the Province of Nova Scotia, and in some cases it's just a matter of companies becoming more modern and catching up, trying to stay current. In Nova Scotia many of the companies have been around for a number of years and through various reasons, reasons of their own, they haven't been able to keep pace with modernization, so we come in and we offer some valuable assistance to them.
Also, we do investments through PIP. I'm going to pick a number, and I know if it's not right the deputy will correct me, the number is about 10,000 workers, employees that have received training under the PIP initiative, not to mention the 400 companies that have taken advantage of PIP. There's also the clean technology. So we pride ourselves on the PIP initiative.
What also makes up part of that money, that line item, is Cape Breton rail, the investments that the taxpayers have made in Cape Breton rail, and also part of that line item would be aerospace and defence. I'm sure the member is aware that aerospace, defence and security is certainly a large part of the Nova Scotia economy, the Atlantic Canada economy. So it's a summary of PIP being the biggest part but certainly Cape Breton rail and also aerospace, defence, and security are in that line item.
MR. MACLELLAN: For the Investment line there was $17.8 million - so $18 million - then the forecast is over budget by $1.5 million and then the estimate for the coming fiscal is back to that original $17.-something million, so was that a one-time investment? Was that something very specific? Can the budgetary overrun be linked specifically to a project or some kind of injection, because it seems like that inflation hasn't been accounted for in this budgetary year, so is that one project or is that just sort of a global overrun?
MR. PARIS: The member, I trust, will be happy to hear that the reason for the difference is certainly the investment that government has made in Cape Breton rail. There would be some other one-time investments involved in there but Cape Breton rail is certainly the driver in this instance.
MR. MACLELLAN: Where is that Cape Breton rail agreement? Where are we in terms of the years? I think it was last year that the agreement was renewed, that subsidy, and if that's the case, has it been budgeted for in this upcoming fiscal year? Again, if that was the blip in the budgetary radar, it looks as though you're back to the 2012-13 estimate number, give or take. If that was that investment, what's the timeline? When will that investment be renewed and has that been accounted for in the upcoming fiscal year?
MR. PARIS: Cape Breton rail was a three-year agreement that we signed with Cape Breton rail. I wish I had the mind trap that I could quote these numbers right off the top of my head but I'm going to have to read them. It's a three-year agreement; for 2013-14 we've set aside $2.563 million.
MR. MACLELLAN: I'm now going to drop to the next line, the Nova Scotia Jobs Fund. Looking at that number, we've talked at length about the collective value of that line item. If you look at the overall budget for ERDT, this was really the line that was diminished greatly because of the ending of the committed $40-plus million for the forestry strategy.
Can the minister explain how the budget deliberations led to this number? How is it decided that $30 million - $29.5 million - would be the number for the collective amount for the Jobs Fund for the 2013-14 fiscal year?
MR. PARIS: Certainly the member is accurate, we invested $44-plus million in the forestry sector, but that also accounts for deals that are already done, that we've made a commitment to but also it is a projection of deals that we are currently working on that may come to a conclusion during the fiscal year. It is an estimate and it's an estimate that is based on projections. That's probably the best way I can explain it.
MR. MACLELLAN: Would the minister mind explaining how these funds are allocated and how they're accessed by the Cabinet and by the government, as in what's the decision-making process? Can the minister include in the response some implications of what the advisory board for the Jobs Fund does, what's the relationship between the advisory board and Cabinet; basically in a nutshell, how these decisions come about?
MR. PARIS: A good question and one that I'm truly proud to respond to. The Jobs Fund is the first step in the process, as it goes down that path; it's a four-step process. We have the Jobs Fund board, so the board would be the first check and balance. From the board it then comes to my office where I go over it, and if I sign off on it, from there it goes to the Economic Investment Committee where I, as the minister responsible, would present it along with - I'll use the term that I probably would use most commonly - I give the good, the bad and the ugly at the Economic Investment Committee. So that's step three.
The fourth and final step would be when that transaction or that proposal goes to the Executive Council. Again, this is a process that has been implemented under our watch for the purpose of oversight.
I've got to just add that all of these steps are important and I don't think one overrides the other, but I will say that at the Jobs Fund board level, we have the Nova Scotia business minds on that board so I always consider their views and their opinions as very valuable, as far as the go-forward is concerned. I think the process we've set up takes care of oversight. I think this is, in my opinion, the right checks and balances put in place.
I should also mention that even before something goes to the board, also in that package is the in-depth analysis that is done by staff; staff certainly go over everything with a fine-tooth comb so we could say that is certainly another step in the process as well.
MR. MACLELLAN: You mentioned about staff. Is there specific staff assigned to Nova Scotia Jobs Fund or is this just a budget allocation that follows the process as you've outlined? Are there specific individuals under ERDT or one of the development agencies that is specifically linked to the Nova Scotia Jobs Fund?
MR. PARIS: Yes, we do. There is a dedicated team, but also, even though there is a dedicated team, we at ERDT are very blessed that there is an abundance of talent within ERDT. What we also do is we search out, if there's an area of expertise that somebody has within the department that may not be part of that team that has a direct liaison, then we do reach out, search out and find that expertise within. We have people dedicated in Investment and Trade who have direct responsibility to the board, but again, we don't confine ourselves just to those individuals because we reach out within our department and look for the expertise.
MR. MACLELLAN: On the advisory board piece, are there times when you don't follow that process and the step process doesn't always come in line and no one component to that is more important than the other? Are there times when the advisory board comes forth with a project and they're not approved, or is this something that is on the back end and they do specific details and look at specific components of a deal? I guess, in a nutshell, do they come to the department with recommendations and are those recommendations sometimes turned away, or do they serve on the back end to make sure that the fine details are looked after?
MR. PARIS: The advisory board, first and foremost, is there to advise. That is what they do and they do an excellent job. They are at the front end of any one of our transactions. They are, as I said previously, the first point of contact outside of staff.
I talk about how fortunate we have been because there have been times when the advisory board has come to me with suggestions on ways we can improve the deal. So is it carved in stone that I follow their advice? Well, no, it's not, they are strictly advisory, but I can say with all sincerity that if they have an idea that they come forward with, it has always been a good idea. What they do in some cases - if I can use the word "package" - they make a package that much stronger, they add strength to it.
MR. MACLELLAN: Just looking at the final line under Programs and Services for Investment and Trade, we have Major Investment and Project Office. It came over budget by 100 per cent and that sort of number, $736,000 went to $797,000 so it's growing for this upcoming fiscal year. Can the minister break down what were the reasons for the cost overruns for that, first of all, an explanation and a breakdown of what that specific line item entails and what sort of budget implications are to go 100 per cent over, and then maintain that $797,000 for the 2013-14 fiscal year?
MR. PARIS: I know that the member for Glace Bay and all members of the House are aware of this, but we made a major investment in the Bowater transition team, which accounts for a large part of that line item.
I will also say that this is a line item that, as we move forward into the future, there will be some growth in this line item. We've got a department now that is solely fixed on major investments and projects in the department. Bowater transition team is the biggest chunk of that money.
MR. MACLELLAN: Madam Chairman, I thank the minister for that. I'm sure he will be relieved to know I'm going to move away from the line items for the budget. I'm going to ask a few questions about some of the files that we've spoken of many times here in the House, and certainly in our respective communities and in many different arenas. The one that stands out - and I know the minister and I have reviewed Hansard on this file, and I know the minister and I have had a few exchanges on it - is, of course, the PROJEX investment.
I just want to get some information and share and exchange on this and clarify where I've been with this. I have asked a lot of the questions and I've led the way on some of the questioning, so I think I have a bit of an understanding for this file, and certainly, I have my perspective on it. A lot of what my information is, and what I've come to understand about PROJEX, stems from conversations and dialogue with the Consulting Engineers of Nova Scotia.
As the minister knows, 4,000 employees fall under CENS, and they say conservative estimates would be 120 to 150 jobs per year to the Nova Scotia economy. Other than indirectly through some contracts they may be awarded, they would receive government money that way, but in large respect, they've never received public funding for their operations or anything of that nature.
I just want to assure the firm and the minister, again, this has never been about PROJEX; it has never been directed at them, and I would never put responsibility - they are a private-sector entity. Their job is to make money. They do have the Nova Scotia connection with their president, Mr. Richards, so there is rationale for them to be in Halifax and have people on the ground here. Again, the cost advantages that we offer to an industry like engineering is important.
This has never been about them, and I think that the engineering association, CENS, wanted to make that very clear. This was never a question or an issue with PROJEX; it was just about how the public dollars were released. The reality is, if you look closely at the deal, there are two things. The payroll expectations, which is a very big hurdle for a firm like PROJEX, if you are employing the more senior engineers, obviously there's a pay scale and a level associated with that experience and with those years and with that knowledge. They would have to hire a lot of senior engineers to hit that echelon for the payroll expectations.
Of course, it's also a numbers game for that organization, PROJEX, to meet the payroll rebate agreement, they'll have to obviously meet a certain number of employees, and with the nature of the consulting engineering business, with the nature of the Nova Scotia economy, and the Canadian economy for that matter, that could prove to be - it's a peak-and-valley sector, contracts come and they go, and big ones are here and then they're not, there is not even a guarantee that they will reach this.
Again, this is not, and has never been, specifically about PROJEX. These questions are in earnest because I think it is important how we got to this investment. With an industry that has been successful, they're growing jobs, they're certainly growing the economy, doing their part with 4,000 employees, with the knowledge that we have at our community colleges, with the tremendous work that's done with engineers at Dal, at CBU, and at other institutions across the province, I just want to understand, how was the decision made by NSBI to get into this? How was this industry identified, and what was the rationale for supporting the PROJEX deal?
MR. PARIS: I thank the member opposite for that question. I think what I heard was recognition of the importance of those jobs from the West coming the East. Finally we have somebody coming from the West to the East, as opposed to the reverse.
The second thing I want to say is that the Nova Scotia association of engineers - I think it is very important for the member to know that I had at least two meetings with the association. I also know that through ERDT and through NSBI that there had been meetings, that they are working; there is collaboration, as we all move forward, for the betterment and for the good of Nova Scotians. The member should know that the working relationship with the Nova Scotia engineers is on solid footing and we are working together for the good of the whole.
PROJEX coming to Nova Scotia is, as the member is aware, a payroll rebate incentive that we've granted to them and as such, the Province of Nova Scotia does not lose money. The payroll rebate is paid in arrears. Once the milestones are reached by PROJEX, there will be a payroll rebate awarded to them over the next several years.
Rebates never pay out more than what is earned. There has never been an example, even with respect to someone leaving the province after the payroll rebate has expired. If there have been payouts, the records will show that we made more money and we have never lost money, so the rebates have been great. The president of PROJEX - I think the member identified his Nova Scotia roots. When I sat down and was introduced to PROJEX, they also alerted me and told me about the number of Nova Scotians that they have in their workforce - expats who work in Calgary, who want to come home and we are so eager and keen to have those expats return to their home province and contribute to our economy here.
In the world of engineering, we have hundreds of graduates every year in engineering and what this now affords those hundreds of graduates, for some of them it affords them an opportunity to stay here in Nova Scotia and earn a living for their families. I can't emphasize enough, not only about the working relationship that we've established with PROJEX but also the move-forward relationship that we've established with the Nova Scotia association of engineers.
We would like to see more projects come to Nova Scotia. We would like to see more projects that employ Nova Scotians who were born here, raised here and educated here who want to come home. These are good paying jobs that are going to make a huge contribution to our economy. We also worked out with PROJEX - when we envisioned some of those hundreds of graduates from our engineering schools that there will be added incentives for them to go to work for these companies that are coming to Nova Scotia, the recent graduates, the new resident incentives. This is a good deal for Nova Scotians. This is building on making a stronger relationship for the Nova Scotia Government, taxpayers, and the Nova Scotia association of engineers. I think this is a win-win-win for all concerned and I think it's a wonderful opportunity.
MR. MACLELLAN: I wouldn't disagree with anything that the minister said in his reply. The challenge for me, and I'm sure that Mr. Lund can probably help out with this, some of the background and some of the information that led to this deal, my question and my concern with respect to this, and the number of jobs and the industry and bringing people home again, I agree wholeheartedly, but when you put - and I think the deal was $11 million, give or take, so $11 million - with all due respect there would be a lot of companies and a lot of sectors that if you were able to provide that kind of money, albeit a payroll rebate, that is still a cost that goes into your operations that, of course, they have to hit the targets to get, I understand that totally.
The larger concern that I have is with respect to how we identify what industries we are going to support and in what sectors we are going to support. The argument for me, fundamentally, has been that the engineering sector in Nova Scotia doesn't seem to need that kind of support with such an active, competitive sector and an active engineering environment now, it's tough to see. Now there are many sectors, and NSBI and the minister, the deputy minister, and members of this House could identify several sectors that you could make injections to of a similar nature, albeit a payroll rebate or from the Jobs Fund or what have you. I guess the question is going backward, how did this decision come about via NSBI and how did we identify the consulting engineering sector as one that would be viable for public dollar investment?
MR. PARIS: I hear the member and trust me, I hear him very clearly. Fundamentally, between you and me, I think we have a disagreement on philosophy. It's not a big one, it's only a slight one but I hope that I can shed some greater light. I know we're on the same page but what I'd like to see is for you and me to be on the same line. First of all I want to make it very clear that when you talk about payroll rebates, and we'll use PROJEX as the example, I want to emphasize this is not a cost to Nova Scotia. This is not costing Nova Scotians anything.
Here we have an opportunity to bring a company, 440 jobs, many of them ex-Nova Scotians who get very good paid salaries, in the vicinity of $80,000 to $90,000 a year, that could go - this is a company that is in Calgary, Alberta, that is going to be in Halifax, Nova Scotia, at no cost to taxpayers. I want to really emphasize there is no cost to this. So 440 jobs at $80,000 to $90,000 a year, do the math on that - and I'm sure the member is better at math than I am. (Interruption) Someone just said it's $18.2 million in direct taxes for the Province of Nova Scotia. That's not a cost; we make money. We, Nova Scotians, are making money.
We compete for jobs with Alberta. I know I've got a son in Calgary. He has been in Calgary now for a number of years. Would he love to come home? Absolutely. I know what it's like to have family and friends living in another part of Canada and not in their home province. He's thinking about getting married. He's thinking about raising a family. He'd like to do it here in Nova Scotia and he says, well, it's very simple, I'd like to be back home where all of the supports are. I know what that means - well, I've got a built-in babysitter in dad and mum. I love that thought. I would love nothing more.
I see some of my colleagues here in the House getting up on their feet and being acknowledged for having grandchildren and I envy them. I envy them even more when they have grandchildren that are in their backyards. I would love nothing more than for my son to be home with his partner, to be raising their family here, be close to the family home so that Jane or Johnny or Percy, Jr. could be at arm's length away from me. It would be fantastic.
We finally have an opportunity with PROJEX for 440 people from the West to come to the East, instead of the opposite direction, at no cost to Nova Scotians. What we get, that $18.2 million in direct tax without PROJEX, without those sorts of projections, that's $18.2 million, another way to look at it, that we wouldn't have. This is a tremendous opportunity and at any time we do payroll rebates, it shouldn't be misconstrued as a cost to taxpayers because that payroll rebate is only awarded when - and this is for the member's benefit - employment targets are met. This is a significant opportunity for us and if we are going to compete, we've got to compete.
If that didn't happen and if the general population knew that we were trying to persuade PROJEX to come here and if the general population knew about it at the time and if we didn't get them here, I'm wondering what the criticism would have been. Well, minister, you squandered an opportunity to get 440 new jobs in the Province of Nova Scotia. Why didn't you give them something? We are not giving them something. Payroll rebates are an incentive for the company to locate here in Halifax.
MR. MACLELLAN: I want to offer some caution to the minister. He is getting very comfortable with the word "targets". He has used it a couple of times. I think he's going to use it in the future, I hope. Maybe that's the one contribution I made to him.
One more question with respect to that. Again, the points aren't lost on me about the value of, certainly, payroll rebates and how they're used and how the value is implied for the taxpayer - when you have, in this case, $11 million to put forth for an endeavour for an investment, I think there would be endless lists of private sector companies that would line up to say - here's what we can do, here's what we're prepared to do in Nova Scotia. Again, the focus and the fundamental problem that I have with the PROJEX investment, with respect to tax dollars, is that the sector didn't seem to be one that needed involvement by government.
One example we've talked about at great length here with ERDT Budget Estimates is the forestry sector. Rightly or wrongly, the minister or the government, his department, decided that forestry last year with Bowater, with Stern, with Northern Pulp, they needed some help, and the rationale was that we're turning the corner on forestry and we're going to make these improvements and these enhancements to get the respective organizations to the next level. Well, that to me was how you evaluated that sector, so forestry and pulp and paper could be viable so we are going to support it and get it to the next level. That's kind of the question I'm asking with respect to the industrial sector here.
An example similar to consulting engineering would be, say, financial services. If you were to put an $11 million offer on the table for any of the commercial banks or the community banks, the co-ops, I think they would be only too happy to put together a proposal for - well, this is what it would look like, this is what we could do and this is what we could relocate to Halifax. Again, my question is, how did we identify the consulting engineering sector as the one to invest in, when that seems to be healthy in Nova Scotia, versus those who could use some assistance?
MR. PARIS: I feel we are getting very close. I sincerely do, and I'm just going to spend a couple minutes and maybe the remaining gap, which might have started over here, but I think it's somewhere around here, maybe I can close that. I want to be clear. When I hear the number $11 million it almost sounds like that reference that we're actually taking $11 million and saying, PROJEX, here's $11 million and that line item becomes a cost to Nova Scotian taxpayers.
That's not the case. What happens is, whether it be PROJEX, whether it be IBM, whether it be RIM/BlackBerry or any one of those companies that we provide payroll rebates to and say, you come to Nova Scotia, you're going to get a payroll rebate if you create - and I'll use the job creation - if you create x number of jobs for Nova Scotians, company X comes. First year, second year they reach the milestones or the targets that have been identified and they receive money for that, but the money that they receive is a result of the taxes that we've gained from that company. Those are taxes that we never would have had if the company wasn't here, plus the incentive in every instance never exceeds what we get in tax.
Another good example, if you take PROJEX at 440 jobs, add IBM to that mix at 500 jobs, there's almost 1,000. Then you put BlackBerry in there. In those three companies alone there are a total of 400 employees here in Nova Scotia. Together, we will make $22 million after we pay out the rebate. That's $22 million that we, the Province of Nova Scotia, would not have had if those companies were not here or did not stay here. That's $23 million now that we didn't have yesterday.
Now the Minister of Transportation and Infrastructure Renewal has some extra money to invest in roads; the Minister of Education and Early Childhood Development now has extra money to invest in schools; the Minister of Health and Wellness now has some extra taxpaying money to invest in health. These are strategic investments that we make for the long term.
When it comes to prospecting, what NSBI does - and I know the president of NSBI, who has joined us here on the floor, will correct me if I'm wrong here but I know I'm not wrong - is they prospect, and I mentioned yesterday that NSBI are prospectors. They're out there prospecting every day on behalf of Nova Scotians. What they're prospecting for are those companies that have the most likelihood of relocating somewhere and then it's their job to talk to those companies to persuade them to come here.
They have to do their due analysis of the company, of the jobs, and one of the ways they have of doing that is through payroll rebates. I've mentioned already how competitive it is in the global community. IBM could be anywhere in the world, anywhere. We should be - and I know we are - so proud that they have chosen Nova Scotia.
The way that we compete is we compete as a result of payroll rebates, and we compete because of our education system here in Nova Scotia, because of our universities and our colleges. We are the university/college capital of Canada. The world knows that. One of the main resources we have that we can boast about, and that helps us draw companies, are our human resources, the people.
Nova Scotians are good workers, they are dedicated; they are loyal. That's why Nova Scotians are so popular in Alberta. It's because they're good workers. They go out there, and when you hire a Nova Scotian for an eight-day work session, you get 10 hours out of a Nova Scotian. We've got that reputation. Those are all the reasons. Certainly those are the drawing cards, but when you're down at the negotiating table, it's the payroll rebate that's going to seal the deal. It's not a cost to Nova Scotians. We make money. We are making money and that gives us more money so that we can invest, not only in all those things that government does but so we can invest in other companies, other companies that are already currently here in Nova Scotia.
The old saying around ERDT is that if we don't compete, if we don't compete for these jobs, and if we're not getting these jobs, Nova Scotia's economy is going in the tank.
MADAM CHAIRMAN: The time allotted for the Official Opposition has expired.
The honourable member for Cape Breton North.
MR. EDDIE ORRELL: Thank you, Madam Chairman. Being as we're on the topic of payroll rebates, I'm going to ask a few short questions, if that's okay. With respect to RIM, in 2005, there was a $19 million payroll given to RIM to create 1,200 jobs. As of 2011, there were only 540 jobs, and I assume they got the rebate on the 540 jobs. In 2012, the government has given RIM another $10 million to keep or create 400 jobs. I'm just wondering if he could explain to me how that payroll rebate will work on those 400 jobs, after they got the rebate on them already.
MR. PARIS: Madam Chairman, I do thank the member for Cape Breton North for that question. I know that when we make announcements, whether with RIM or with any company, sometimes the real message gets lost to the general population; the public is not aware of some of the details and some of the circumstances around investments.
RIM came here in 2005 and they did come here on a payroll rebate, through the efforts of NSBI. I think anyone who reads a newspaper, listens to the radio or watches television will recall how RIM ran into some difficult times in the last couple of years.
RIM came here originally - and it was a competition. Nova Scotia beat out 30 other jurisdictions that also wanted RIM to be located there. RIM ran into some difficulties and I think that was well - actually it was headline news for many weeks in a row, how their stocks went down. In the meantime, what BlackBerry had decided to do is they were going through reorganization; they were reorganizing their company. They have facilities, as I think most people know; they have a head facility in Kitchener-Waterloo and here in Nova Scotia. They also have a facility in Texas.
Part of the reorganization, to make a long story very short, is what they had decided to do is they were going to close some of their locations. They were going to close and consolidate, and I don't want to use the word "downsize" but they were going to streamline their services. That meant that some places had to close.
Now if we had not provided a payroll rebate and done business with BlackBerry, the chances of us talking about BlackBerry, in the light that we are talking about it this morning, probably would not exist. We may be talking about BlackBerry, but I would venture to say that you would be criticizing me for not having done enough to keep the company here.
I want to say the incentive that BlackBerry gets from the province - and one of the things that I've said here consistently is that our investment in BlackBerry does not exceed our profit margins. As taxpayers of Nova Scotia, we still will make money on it. There are still roughly 400 jobs here in Halifax, Nova Scotia. Did we want to lose those 400 jobs? Well, we were going to do whatever it took that was reasonable and in the best interest of taxpayers, to make sure that BlackBerry stayed in Halifax.
I don't know if I've ever said this but we should be grateful, thankful to NSBI for being able to conduct business with BlackBerry and see that they stayed here, hopefully for years to come. The BlackBerry deal is a good deal. We make money - and again I know the member has heard me say this - this gives us, Nova Scotians, more money so that we can reinvest in other businesses, so that we can reinvest in our education, so that we can reinvest in our health care. It really is a good-news story, all the strategic investments that we've made over the last number of years.
MR. ORRELL: I'm far from having a business background but to me that seems like it's a double rebate for the same job that is already created. I guess my question around that is how long is this deal with RIM, or BlackBerry, and what's going to happen at the end of the deal if they decide they want to pack up and go again? Do we negotiate another deal with them or could we use that money more wisely?
MR. PARIS: I am trying to get my head around that question so I can hopefully give an appropriate answer. The first thing that comes to my mind is - and I say this with all due respect to everybody not only in the House, but everybody that is outside of these hallowed walls - we have companies in Nova Scotia and the reality is, whether we like it or not, any of those companies could pack up at any time. They could just make a decision, well, we're leaving Nova Scotia and they could go.
The deal that we've done with BlackBerry, we still make money on it. It's a five-year deal and if at the end of the five years, BlackBerry came to us, came to NSBI, and said we're pulling stakes, if I were still minister five years hence - or even if I'm not the minister but if I'm still alive and still living in Nova Scotia, which if the good Lord is willing will be the case - my hope would be that the Nova Scotia Government of the day, with NSBI, would negotiate and do what it has to do to ensure that that company and those 400 jobs were around for another five years, or another 10 years, or another 20 years because those negotiations, if it lives true to form, five years hence we wouldn't lose any money.
This is an average of 400 good-paying jobs not leaving the Province of Nova Scotia but staying here and contributing to our tax base. I'd rather we were paying out some of the money as a result of that - not all of it - so that we, the taxpayers of Nova Scotia, would still be making a profit on the fact that those 400 BlackBerry jobs are still in the Province of Nova Scotia.
So the answer to the question is, it would be my hope and my desire, as a taxpayer of Nova Scotia, that the government, five years hence, would do whatever it could that is reasonable and prudent to keep that company in the Province of Nova Scotia.
MR. ORRELL: I'll go back to where I left off in the last round of questioning. When we started talking job targets that came to my mind, so I had to get that clarified and get my head around it as well.
When I was speaking last time, I was asking about the new jobs that are created and had a target of $45,000 a year per job created under NSBI, only the actual result was $38,000. Can you tell me why this target wasn't met?
MR. PARIS: First of all, we don't have those numbers right at our fingertips and the reason I say that - oh, maybe we do. Some of the numbers that the member has quoted aren't in line with the numbers that we have. One of the things I'm looking at in 2012-13, the average gross salary of new jobs forecast is at $55,000. We've got a number here of $55,000 under Outcomes and Performance Measures. I think what I heard coming from the member was a heck of a lot lower than that.
What I will also do is, as I look up at staff, we'll even provide you with something in print with respect to the $55,000 and we'll go from there.
MR. ORRELL: The numbers I'm quoting are from NSBI's 2012-13 Annual Report under the Corporate Scorecard summary. Anyway, we'll move on from that.
On that same report, only one domestic investment deal was done and there was a target of four. Can you explain to me why there would be such a low result if the target was four?
MR. PARIS: Mr. Chairman, first of all, with NSBI, they are very focused on external opportunities. I'm not clear on what the member for Cape Breton North is referring to, and it's on its way over here. One of the things that, in the area for time, I could also make a suggestion: we will look at this when the member gets up again, and maybe we'll get an opportunity to - okay.
The Corporate Scorecard - certainly as I was starting to say when I first rose, NSBI focused externally. Domestic focus is not their forte. It's about attracting those companies from outside that are external to Nova Scotia. When you see the number four under investment clients, and you're looking at domestic investment, it is certainly not one of their focuses. If there's still some area of confusion around the Corporate Scorecard summary - and I only make this offer to save the member some time - we can certainly have NSBI and the member sit down and explain the external attraction versus the domestic investment.
MR. ORRELL: If we're talking foreign investment or external investment, only five foreign direct investment deals were done with a target of eight. If that's the case, can you tell me what happened there?
MR. PARIS: Mr. Chairman, through you to the member, I would caution the member not to get too hung up on the Corporate Scorecard because what, in fact, happens - and I trust the member will be able to appreciate this - I look at the number five, and I see eight as the targeted number. What happens in the area of business, when you're sitting down negotiating for someone to come, they may not show up until a year or two years down the road.
We've already spent some time this morning talking about PROJEX, which was years in the making. I know for a fact that when I met Admiral Insurance, the company from Bermuda that relocated, that opened up an office here in Halifax, that was five years in the making. That means that Admiral Insurance would have showed up in the numbers five years previously, and every year since then, but it wouldn't have been realized until year six.
I would just caution anyone who is going to put too much emphasis or too much hay in the numbers that are presented, these are guidelines, estimates; they are actual companies that are being talked to and, again, sometimes it takes years to do a deal.
MR. ORRELL: I guess we're back on the targets that we're going to get odds at. Anyway, the Business Finance Division had a target to complete 14 projects and only five of those projects are completed. Is that result because of the same idea?
MR. PARIS: That's exactly right. These negotiations sometimes take a while. Another good example would be - and I think this might bring it into an even greater light - I've been to the air show, and in the world of business it's important for Nova Scotia to have a presence at these events because what happens in the world of business, if you miss a year it's almost like you're starting over again.
For these numbers there's such a nurturing process to it for some of these companies and if I'm to reiterate, it simply is not a matter of coming into company X one day and next week walking out with a contract signed, sealed, and to be delivered. It takes many months and oftentimes years before we actually get a signature on the dotted line.
MR. ORRELL: According to that, we failed to meet performance indicators in seven of the 11 categories. Can you tell me what steps are being taken to improve this performance?
MR. PARIS: I want to go on record as saying that over the last five years NSBI has exceeded all of its targets. In the world of business, the economy, more in particular with the way the economy has been in the last four or five years, it has been very up and down.
When you look at the records, collectively, between NSBI and ERDT and all of the folks in the departments, we have been on track. I almost could use that phrase that I've used many times, but we are on such a road here that the future, the horizon does look bright. We've got a lot to be optimistic about.
Again, I would caution the member, through you, Mr. Chairman, not to get too hung up on numbers. We've exceeded targets - NSBI has exceeded its targets now for the last five years and if all goes well, that trend will continue in the out years.
MR. ORRELL: I'm just going by what's printed on the scorecard paper and I assume the targets should take into account the time it's going to take to negotiate a deal, which will mean it will be an ongoing target to be set. If that's the case I wonder why the targets would be set so high if we know that it's going to take time to negotiate. Why wouldn't we set the targets a little lower so they would be achievable?
MR. PARIS: I would say that first and foremost Nova Scotia is very aggressive. We are aggressive and we believe that we consider ourselves as fisher persons and sometimes the more lines we have in the water the better chance of landing the big ones. We are simply very aggressive and I reiterate that we've exceeded our targets over the last five years, and I think that Nova Scotians will hope that trend does continue.
MR. ORRELL: Mr. Minister, if it would be okay now I'd like to move off the Economic Development part and move into Tourism. Do you need a minute?
MR. PARIS: Just a minute.
MR. ORRELL: Okay, and if I could, the honourable member for Hants West wants to start off and we could go back into it, so that will give you time.
MR. CHAIRMAN: I think we will call a five-minute recess in order for the minister to have an opportunity to change out and stretch his legs. We will recess for five minutes, thank you.
[11:07 a.m. The committee recessed.]
[11:13 a.m. The committee reconvened.]
MR. CHAIRMAN: Order, please. We will now continue on with the Progressive Conservative caucus. The honourable member for Hants West.
MR. CHUCK PORTER: Mr. Chairman, it is good to take part in this section of the estimates. I have a few questions for the minister, which I'm sure he's not surprised at given some of the things going on around tourism in the area of Windsor, which I represent. Maybe I'll jump right into that one first of all.
The Tourism move of department staff and so on to Hants West, to Windsor specifically or somewhere in that area, I wonder if you can update us on the status of that. I know that there was thought about building tenders, the number of people that were going. I think early on in this session I asked you a question about that and probably in the last session I asked you a question about that, but we're certainly a lot further along now. I would certainly appreciate it and I know the folks at home would - a bit of an update, if you will.
MR. PARIS: Mr. Chairman, I welcome the member for Hants West to the floor and the exchange that's going to follow.
An update - I will say this, I am limited to what I can say. The tender has been issued, as the member is well aware, and it has been awarded. I'm not in a position - it hasn't become public yet. It has been awarded so within a day or two that should be in the public domain. We are on schedule; we targeted November 15th to have things up and running. Part of awarding the tender was a commitment to that date. We've been assured that can be met so yes, we will be happy when this is put to bed and that the agency will be up and running in Windsor, Nova Scotia.
MR. PORTER: On that, a tender has been awarded, yes. You didn't speak to it and maybe you're not able and I appreciate that. Whether it was new or the renovation of another facility, I guess that's one thing I was curious about. If you can speak to that, fine; if you can't, I certainly appreciate that too.
One of the things I wrote, maybe to you - I don't have the letter so I can't speak to it and can't table it - was with regard to whether it be new or it be a renovation, that the work would be done locally with local places like Swinamer's Home Building Centre and all of our local people that supply these sorts of things would be considered. I know that government goes out and tenders and always looks for the best buy, if you will.
Knowing the folks like I know them, I know they can be competitive, as well, when they need to be for work, so I hope there's a process in place that says we're not going to go to one-stop shop and do it all, that we're going to give our local businesses an opportunity to be part of that process, especially - and I know that you're well aware of this - given the job loss, not only that we've had around the province but certainly at home in Windsor and West Hants, and how important those jobs are to maintain what we have and to grow a little bit if we can.
I would ask on those couple of points, as well, when you made the announcement - I know I was there that day - there was a target date of September. I obviously appreciate that sometimes time does get pushed out with regard to process, and so on, and I assume that's what happened here, that the time is pushed out to November 15th, as you quoted there a few minutes ago, from the September date. If you want to talk to that a little bit, too, why has that transpired? I'll leave it at that and then maybe I'll come back to a final piece on that particular item.
MR. PARIS: Mr. Chairman, through you to the member, one of the things I said earlier this morning is I gave some attention to myself, personally, about how I liked to be, or at least try to be, as inclusive as possible. The reason that the timeline was extended was that we didn't want to eliminate potential bidders from the RFP. If we had the timeline as tight as September, then possibly some of those individuals from Hants County who might be interested in making an offer, maybe it had to do with new construction and we would be cutting it pretty - well, it would have been darn near impossible for anyone who was looking at new construction, or even in some cases, a renovation. In an effort to be fair, we did extend the timeline.
Also, we weren't overly concerned about pushing that timeline into November because by extending it and allowing more Nova Scotians to be part of the process, not only was it the fair thing to do, but it was also about Nova Scotian taxpayers getting value for their dollar.
That's one part of the question; the other part of the question was about whether it would be renovation, a new build, or something else. I hope the member can appreciate that by answering that question, I would be identifying some individuals or some companies that were part of the process that maybe didn't get the tender. I want to be fair and I'm sure that the member will understand my reluctance in doing that. It's not in the public domain yet and once it gets out there, I'm good to go, so to speak.
The third question that I heard was who will be doing the work? We live in a democratic society. Whoever is awarded the tender, whether it's for renovations, whether it's new construction, or whatever, we certainly, as government, aren't in a position to dictate to whomever it is that you have to use so and so. I would like to think, based on economics, that whoever it is would be prudent and do the just thing if they require work or renovations or a new build.
MR. PORTER: I appreciate that there is certain information you can't let out with regard to who has that tender and what that will be. I'm fine with that. I was just curious as to where we were with that. I also understand clearly the process of being fair and if that stretches it out another six weeks, I don't think anybody will be jumping up and down about that either. I think it's good that we are giving the opportunity for others who may wish to bid on that project, through that, an opportunity to do so.
Just for clarity on that last piece that you were talking about: it wasn't so much who was going to do the work, it was about local businesses being used to purchase from, like the building supply stores, et cetera. Was there any consideration - I'm not sure what the rules are on it - I would like to think that we would be able to have some input with stipulating that we should be buying from local community businesses to help grow the economy in that area, as this is quite a significant piece. Whether it's a renovation or new, it's still work in the area. That's important to me and I know it's important to the people I represent, especially that business community and those people working in those jobs and those lumber yards and stores and all of that industry in supply, so very interesting on that.
The November 15th piece that I talked about was not that big of an issue at all, really. Thank you for the clarity on that. The only other piece on the office of the Department of Economic and Rural Development and Tourism coming to Windsor I was curious about - and I asked last Fall about this - was the number of jobs that were actually transferring versus the number of jobs that might actually be available to be applied for. Can you talk a little bit about that process? I would see there being a certain number that would like to transfer; it would then go to the union or something like that, those civil servants from other departments who could transfer and/or what might be, at the end of the day, needed from residents in the Valley with the opportunity to work in the department.
When I asked the question in Question Period last Fall, it was a time frame thing. You had to allot them a certain amount of time - I believe was roughly the answer - to go through that process and make a decision. If you could - just a little clarity around that and some points on it would be great.
MR. PARIS: I heard a couple question in there and I'm going to try. The first one is - and I'm sure the member is aware of this - TIR is the lead when it comes to our facilities. I would suspect - well, I don't suspect, I know - I don't know if he's listening. When it comes to contractors or people doing work for the Province of Nova Scotia, there are some things that we just can't interfere with. There are trade agreements, et cetera, and we just have to let nature take its course, and a lot of this will be contingent on whoever the successful bidder is.
The other one, with respect to the numbers, a lot of things were contingent on us getting a site so now there is a whole process that we have to go through. In the Nova Scotia Tourism Agency there will be a total 34 jobs in Windsor. Now obviously there is a number of current staff that will be transferring to Windsor. I think there might have been a few that have already done some searches for homes in Windsor. Once we go through that process, then for any vacancies created we will have to follow the guidelines of the Public Service Commission, that's another process that we have to adhere to. At some point in time in the months ahead we will know fully about what positions are going to be vacant and what positions will be going up for offering to the general public.
MR. PORTER: As I'm sure you can appreciate, since the announcement was made I would have received numerous e-mails, Facebook messages, and phone calls regarding how I can get a job in tourism in Windsor. There are lots of qualified people, obviously. Regardless of the number who may be available, I'm certain we'll have a lot of applications come forward and that's a good thing. Thank you for your clarity around that and I understand the process through the civil service, and I think most people do, as to how that will work, can work, and should work.
I want to move on a little bit to another piece of tourism that I think is quite valuable, I'm sure you would agree, and that is the festivals that we house not only around all of Nova Scotia but throughout the Valley. Apple Blossom is one that you're very familiar with; another one would be the Summerfest that we house in Windsor. I know that over the years the Department of Tourism, and maybe others, have supported some of these festivals.
I'm told there has been quite a significant decrease over the last few years in the Apple Blossom Festival alone. Can you speak to why we've dropped in that? I know times are certainly tougher. I know that you have a back-to-balance strategy you've worked on for a number of years. When I talk to the people involved around the festivals, I agree with them, these are big draws and I think about the Apple Blossom specifically because people do come from all over; they come from home, from other places around the country, and all over the world for that matter. They book their vacations and they do any number of things.
The spinoff effect of that 100,000-plus people that can come to Kentville and surrounding areas for the Apple Blossom Festival is huge and they would see the investment that had been made in past years as good investment, but I'm told - I haven't seen the numbers so I'm just quoting what I've been told - that the number has dropped significantly and I wonder if you could speak to that for a few minutes.
MR. PARIS: I thank the member for the question. I will say for the record, the budget line item for festivals has remained the same; we haven't reduced that.
One of the things that we do face in Nova Scotia, there are a lot of festivals right across this province. Since becoming the Minister of Tourism, I think I could probably hop in my car, or in some cases even walk just from my house, and there is going to be something going on pertaining to a festival of some sort.
There are some festivals in Nova Scotia that one may put into that category of being iconic. Certainly the Apple Blossom Festival, I was there last year and I spoke and I was there the year before. I go to the Apple Blossom Festival with some mixed emotions now only because, as the member is well aware, I have family roots in Windsor, in Currys Corner. When I went home in the past I was used to one person I could always count on coming out to hear me, whether I was speaking or whether I was just maybe giving a cheque to somebody, was Buster, my father. Of course Buster is no longer with us so on my jaunts up to the Valley, when I'm going up there for work, I cannot help but think what would have been and what could have been and what's not now.
Our money allotment for festivals hasn't decreased. One of the things we always hope for is that when we - and I can remember when I first became minister, and I'm going to use another example. I know you used the Apple Blossom, and I've got a reason for this, Wharf Rat Rally in Digby, where you just have literally thousands and thousands. They're going to have to make Digby bigger to accommodate this rally. I can remember one of the first things that I was faced with, the Wharf Rat Rally running at a deficit. I can remember sitting down with the Wharf Rat promoters and recognizing - I recognized, as minister - that this was very important, not only to Digby but to Nova Scotia, and we made a significant contribution to the Wharf Rat Rally so they could get out of debt and continue into the successive years.
In my conversation with the Wharf Rat Rally, I was asking questions and I was analyzing and for the life of me, I was thinking, gee, this should be making money. I started asking them questions and the individuals I was working with said, well, they didn't want to do this, they didn't want to do that, staff was involved. I said, well you know, I don't think it's appropriate that something that could be sustainable, comes to government looking for money when it's not - the easiest thing to do is we'll just go to government and we'll get the money from the government.
Now what we have - and I think I'll be a little bit selfish here and take some credit - I started making them think about ways they could make money. Now they've got new people heading up that rally, and I think they turn a bit of a profit now.
The Apple Blossom Festival is different in the sense that it's more of a parade, more of an event of dinners and evening events, but our goal in Nova Scotia, we have a new tourism strategy in the Province of Nova Scotia with the theme Take Yourself There. What I would like is for all these events that go on that apply to us, to know we are willing and able to listen to anyone, including Apple Blossom Festival.
We have some expertise that sit around various tables within ERDT that can be of help, and we've got some things that, possibly, we could do in kind for organizations that could save them some money. I've already mentioned I've got a soft heart for the Apple Blossom Festival, so I would encourage the member, through you, Mr. Chairman, that in his deliberations with the Apple Blossom committee, to encourage them to give us a ring up, and we'll be more than happy to sit down and talk to them and see how we can assist in any way, shape, or form.
MR. PORTER: Thank you, minister, and I know that you know those festivals well, and I also appreciate that you have many festivals to deal with around the province. In the Valley alone, there's something going on every weekend throughout the summer, there's one festival or another, and there are lots of things outside of the summer vacation season that also go on that are well supported.
Again, I don't know what the numbers are. You said the line item hasn't changed. Obviously the method for handing out - the numbers of those asking has obviously changed to share the money around, if you will, for lack of a better term, and I'm sure that's part of it. I will go back to that group I did speak with, unofficially and informally, and let them know that we've had a conversation and they should contact you and see what their needs might be, if there's something more that can be done there.
I wanted to just move on to, if I could, and I will relate this to tourism, the RDA, which is now in place, which will soon become RENs - is that the right acronym? Is that going to play a role in the tourism strategy, as we move around the province, and if so, what will it be? We've had a good RDA, in my opinion, from where I come from, and they've played a variety of roles when it comes to trying to improve things going on in the community, from seeking out jobs, companies. We've had some good people there I've dealt with over the years who have done any number of things, and were always open to things. Where do they fit in the tourism piece, or are they even part of that? Maybe you can clarify that for me.
MR. PARIS: Before I answer the question, I just want to go back to something with respect to festivals. The member has readily recognized, even though the line item, the number stays the same, the member is correct, there are so many festivals. The demand on that fund has certainly gone up. Now, with respect to the RENs, one of the things that RDAs had in common, right across the province, is with respect to partnerships. Actually, we didn't have to do any pushing because they created partnerships with tourism agencies in their jurisdictions, and some of the relationships could be just as simple as an MOU. But certainly we encourage that kind of thinking, that kind of proactivity so that the RENs, the former RDAs, will be fully engaged with people in the tourism industry, those tourism associations. At the end of the day, the constituents are the ones who are the real winners here and certainly that's what the RENs are about.
MR. PORTER: Thank you, minister, for more on that. I guess I'll just finish up with visitor information centres, a number of them around the province, of which we have one, I'm sure you know where it's located, near the causeway there and heading toward the island, for those who might understand that terminology. You know very well where it is.
Has there been any decrease in funding for that, or change in the number of hours that will be open? It is a fairly busy centre over there and we've always had it open and someone employed there. I'm just kind of curious to make sure that that is going to be up and running. Are there opportunities for enhancements to that as we look forward to new tourism strategies that you're talking about, what happens there?
Now that facility has been there for a long time and it's probably in need of some work, too, actually. Does that come through you or is that something else that we're going to pass over and have to ask TIR about because it might be theirs? Maybe there is a partnership in that with someone else but I'm not sure if the municipality, the town has some involvement in that any longer.
I know we've got only a couple of minutes left. I'll let you have a little time on that, if you would, for some clarity.
MR. PARIS: Just for clarity, when it comes to capital infrastructure, the Minister of TIR would be more than pleased - he's listening intently and nodding his head. I'll leave that for him to respond to.
I know the visitor information centre that you're talking about well and I chuckled to myself, Mr. Chairman, when the member was talking about the age of that centre. I can certainly remember that centre when I was a kid growing up in Windsor, living not too far from that centre. I can remember going down to the island and being late for school one day because I missed the ferry. I'm sure only the member for Hants West will appreciate the humour in that.
What we do for visitor information centres, we provide yearly funding to tourism associations right around the province. The VIC that the member refers to is not operated and owned by the Province of Nova Scotia. It's operated by local groups, through the various tourism associations. It isn't uncommon around the province for municipalities or tourism associations to have their own VIC. We contribute indirectly to those VICs because we contribute yearly to tourism associations.
I understand the question and I don't know if that's the answer you were looking for but that's the answer.
MR. CHAIRMAN: The time allotted for this round of questioning has expired.
The honourable member for Yarmouth.
MR. ZACH CHURCHILL: Thank you, Mr. Chairman, minister and staff, for being here. This is our third year in a row where we've discussed estimates together - the minister and myself. I've actually found these conversations very helpful in terms of getting sincere questions answered. I think a reason for that is because this minister has always approached estimates with a very real and sincere desire to answer Opposition members' questions and respond to our concerns.
I would also like to mention on the record, the minister has mentioned that he's an accessible minister. I'd like to echo that. This minister has always made time to meet with myself, constituents. He even came down to Yarmouth to meet with some business leaders to discuss issues a couple years ago. Even this week during the heat of the House, the minister still takes time out of his busy schedule to meet with myself and a constituent to discuss economic development issues in Yarmouth. I want the minister to know that I appreciate that very much and have always appreciated it.
MR. CHAIRMAN: Order, please. The chit-chat is getting rather loud in the House and I'm even having trouble hearing the honourable member for Yarmouth, which doesn't happen too often.
The honourable member for Yarmouth has the floor.
MR. CHURCHILL: Thank you, Mr. Chairman. I just wanted to express on the record my sincere appreciation for the minister's approach to estimates, discussions and his willingness to always meet with Opposition members, anybody that we ask him to meet with.
I do have some questions around the Tourism budget, which I won't hesitate to get into. Again, I want to thank the staff for being here, taking time out of their busy schedules. It's good to see Mr. d'Entremont, who is from my neck of the woods here, and everybody else who is in place. I was just chatting with Stephen Lund actually after he left recently; but Bob Manuge who is, I think, the forefather of NSBI - led the precursor to NSBI and has been credited with actually bringing Michelin into the Province of Nova Scotia. Mr. Manuge now is actually residing in Yarmouth on one of our county roads and has been a wealth of knowledge and information for myself and I know for other business leaders in the area. It was nice to be able to chat with Mr. Lund about Mr. Manuge.
On Pages 6.6 and 6.8 where the figures show the transfer of Tourism within the department to the Nova Scotia Tourism Agency last year, there seems to be a discrepancy in the numbers. The forecast shown on Page 6.6 shows over $26 million for the department, but on Page 6.8, this funding is now just over $15 million allocated to the new Tourism Agency. Now I assume this means that there has been a cut in the department and I would just like you to let me know if that assumption is correct.
MR. PARIS: This did come up earlier in estimates and I remember it. The difference is the changes that have been made in our VICs. I think it was 71.9 transfers, which would make up the difference there, so that's why there is a difference there. It's all associated with part of the transferring of VIC personnel.
There were also two - this is all coming back to me now - with the Signature Resorts, one at Digby Pines and one at Keltic Lodge, and those positions were in the area of maintenance.
MR. CHURCHILL: Just to clarify for myself and the folks listening at home, does this mean that there is $11 million less that the department has to operate with?
MR. PARIS: No, that's not what that means. The monies have been transferred to ERDT.
MR. CHURCHILL: The dollars that have been transferred to Economic and Rural Development from Tourism, could you explain why that transfer happened and are those dollars being used for tourism or for other economic development initiatives? If they are being used for other initiatives or other programing needs in the Department of Economic and Rural Development, what are we now missing from the Department of Tourism that was funded by that $11 million?
MR. PARIS: Mr. Chairman, through you to the member for Yarmouth, I want to say to him, to all members of the House, and to the general public that rest assured, we are not taking away from services that are provided to Nova Scotians. The relocation is part of our reorganization. We thought that some of those services would be better aligned somewhere else and that doesn't translate, or should not be interpreted in any way, shape, or form as to us reducing services to anyone in the Province of Nova Scotia. Also, on paper, one of the things that we have been requested to do, as the estimates indicate and testify to and that was part of our overall strategy as a department, ERDT, is to assist in our efforts to help the province get back to balance this year, as far as the budget is concerned.
MR. CHURCHILL: Just to make sure that I've wrapped my head around this, the $11 million discrepancy that is in the Tourism budget was simply an accounting for those dollars, so what has happened is those dollars are now just accounted for in the Department of Economic and Rural Development and not Tourism, and that any programs or staffing or anything that was funded by that $11 million, nothing has changed with that. It just means that in terms of accounting purposes and budget lines in departments that it shifted to Economic and Rural Development from Tourism, am I understanding that correctly?
MR. PARIS: The short answer to the question is yes, but you mentioned $11 million and the line item that I'm referring to and looking at, what I have here is $9.8 million and some change. I don't see an $11 million difference here, and maybe we're just looking at some different numbers, but basically the answer to your question is as I just said, so we should be all right.
MR. CHURCHILL: Just to clarify before I move on, the numbers that I'm looking at on Pages 6.6 and 6.8 of the budget, the forecast shown on Page 6.6 shows $26.032 million, and on Page 6.8 this funding is now allocated for the new Tourism Agency but the figure is at $15.077 million. That's where I'm getting the $11 million from.
We can shift from that to FTEs in the department as well. On Page 6.6 the FTEs for 2012-13 actuals were 95.3 but we see in the Nova Scotia Tourism Agency, the full-time employees have been reduced to 39.2. I was wondering if the minister could clarify if that means that we have fewer folks working in that department or if those folks are actually just being accounted for in Economic and Rural Development and Tourism as well. Thank you.
MR. PARIS: This number keeps recurring and the number that I'm referring to is the 71.9 VIC staffers who were transferred. If you look at that, you're going to see the balance if you take that into account. For the member, if you include those in your numbers, then things are going to add up.
MR. CHURCHILL: Thank you for the clarification, minister, I appreciate that and we'll be able to take a look again at the budget figures and see if we can identify those changes as well.
Now on to a topic that is one of our favourites to talk about, always, it is still an issue of significance to my riding and I know to the tourism industry across the province, and that's the Yarmouth ferry. The government as recently as last year, I believe, announced that there would be $21 million available for ferry restoration and that money would be allocated, $3 million annually for seven years, to help bring a service back. Is this money reflected in the budget? Is there a budget line that we can look at and say this money is allocated for a ferry restoration?
MR. PARIS: I just want to clarify some things through the chairman to the member for Yarmouth: the $21 million that has been allocated - I shouldn't say allocated - that has been said that we will invest in the Yarmouth ferry, what we have said is we don't know how that $21 million will be disbursed or spread out. What we were very careful not to say is that we were going to dedicate $3 million a year.
What we've said is that it would be $21 million over a seven-year period and how that money will be disbursed will be dependent upon the accommodations required to get to the ferry. It could take a number of forms.
What we've always maintained, the recommendation was, realistically, that we would be looking at a ferry in the year 2014. What we did is - and I know the member is very well versed on this - we sent out a request for proposals early because what we didn't want to do is if by some way or by some form there was possibly a ferry service provider out there that could accommodate the needs of a ferry for 2013, we - government - certainly didn't want to be the ones who were not being inclusive, we didn't want to be the ones who were eliminating that from taking place.
As the member is well aware, we didn't come up with a satisfactory or acceptable request for 2013, so what we've done is we put out a modified request for proposals for a ferry that's more appropriate to the timelines related to 2014. Anything for 2013, pertaining to a ferry in Yarmouth, will not be captured in 2013 - there's not going to be a ferry in 2013, but when we move forward there may be some small amounts.
I wouldn't want anyone to get the impression, to think that for seven years we're going to have a line item for seven years straight of $3 million in the budgets - a budget projection over seven years of $3 million every year because that's not the case. Even though the Premier has committed to spend up to a maximum of $21 million, we don't know yet how that is going to flow until we hear back from the proponents on a ferry service coming out of Yarmouth.
Of course, when we talk about ferry - and I know the member is well aware of this - it's my opinion that to have a ferry coming out of Yarmouth is going to require a concentrated effort by more than just the Province of Nova Scotia. Certainly I recognize the role that the federal government will, and should, play in this. I think there is also a role for local governments as well, and I just wanted to make sure that we understood clearly the $21 million and that it wasn't necessarily $3 million per year.
MR. CHURCHILL: I appreciate the minister's comments around the need for co-operation between the federal government, the provincial government, and municipalities. I know there is a very deep desire on the municipal side to see this project come to fruition. It is going to be challenging. I think one of the reasons for that is because it has been three years without that service happening, so we have to recreate that market again - re-market the run - once we identify a service provider able to do it, and ensure people know that service is going to be available again.
From what I've heard from the tourism industry, as well as from the Nova Scotia International Ferry Partnership members who have done a very good job working with the province on this file from my perspective, and who have become the resident experts in our area on this file, in chatting with some of those members and members from the tourism industry, they've made it pretty clear that in order to make a 2014 run viable and successful, we're going to really need to market that run a year in advance during the 2013 season. That's what I hear from the tourism industry and from the folks involved in the Nova Scotia International Ferry Partnership.
My question to the minister is, is there funding that is allocated in this budget for ferry restoration or that can be used for ferry restoration - and that's not just giving money to a company, that's also looking at the need for marketing dollars as well - is there a line in this budget that we can look at and say, okay, this is where funding for a ferry could come from if we need funding this year? In my opinion, based on what I've heard from the experts in the field, funding would be required this year to make a run possible in 2014.
MR. PARIS: Mr. Chairman, I'll say to the member, through you, I understand and appreciate the value. If you're going to build something, you don't wait until it's built and then start advertising it. A good example would be the Nova Centre. We are advertising now for the new convention centre, that's three years down the road, before it's actually going to open its doors. So it's important that when you build something, it's not necessarily - I don't subscribe to that philosophy "build it and they will come."
If there's going to be a ferry service, you've got to have a strategy in place already advertising that a ferry will be running, a schedule - you just have to market it, you don't wait until it gets in the water and leaves Yarmouth with nothing but the crew on board.
I will also say that as we move forward on this project - and I will say this now, and I trust the member will remember this - if there are the right conditions, and if there is a movement of a ferry, I can guarantee to the member that money will be spent towards marketing. And it will not be the day of, the week of, the month of, the ferry hitting the water. You know, we are Economic and Rural Development and Tourism and we'd be foolhardy to plan for such an event in a way that it was going to be detrimental to the event itself, so I can guarantee you I would find whatever money was necessary to make things happen.
MR. CHURCHILL: So I assume that means there is money that could be allocated in the budget. If it's not specifically allocated, there's money that the province could access to market a vessel pretty quickly if we start getting towards a deal with a service provider that's going to work, and there will be some money that's available - is that going to be available through the Industrial Expansion Fund or is that money that comes out of the departmental budget?
MR. PARIS: You know you're talking about the Jobs Fund; the Industrial Expansion Fund is no more. But through our programs we could find money to run a campaign associated to a ferry launch, and actually more than that, associated to a marketing strategy for our ferries. So I'll stand here in my place and say that, as minister, I make that commitment. It just makes good business sense.
We all knew the conditions under which the ferry lost its subsidy, and the last thing we want is a repeat. We also recognize that it takes time to build up clientele - visitors get in the habit of doing other things, but we know that one of the good things about Nova Scotia is it is becoming a world-class destination. I'm sure that the member is well aware of tourism numbers and, although they may not be things that we would readily go out and boast about, I think we've been doing more than just holding our own.
MR. CHURCHILL: Mr. Minister, thank you for that commitment to act to find the money when needed to do this.
In terms of how that $21 million has been committed, is there a breakdown available to the public, or that we've done internally that shows how that money is being allocated? Is that money solely for the purposes of investing in whichever company it is and providing them with short-term subsidy, or are marketing dollars included in that $21 million as well? I'm just trying to get a clarification on what that $21 million is for and how it will be used, and if you have any specific ideas on how that money will be allocated to get the service back, I think that would be very helpful.
MR. PARIS: The $21 million does not include a marketing strategy. The $21 million would be - again, I'm going to reiterate, it could be over the seven years starting at $6 million the first year, down to $1 million in year seven, which adds up to $21 million - at least by my math. But even that's not carved in stone; that's just one of the other possibilities that the subsidy could roll out. I would suspect, and my common sense, my business sense tells me that the subsidy would be more weighted up front at the start-up of the ferry operation and, over the years as passenger ridership increases, the requirement of the subsidy would decrease in numbers. At the end of the day, after seven years, it would reach the total of $21 million.
MR. CHURCHILL: We know that it's going to take significant federal investment, as well, to get this project working - I don't anticipate that the federal government will put any money into the business that comes in to support them; I think that's where the province's money will be going.
But the federal government currently owns the terminal and it's an international port, so I believe the most likely scenario is that the federal dollars, if we get any, will be allocated to a new terminal or terminal upgrades. From what I've heard, we basically need to tear that terminal down and build a new one - it's going to have to happen pretty quick if we're going to get a ferry back there for 2014.
To date, the federal Conservatives have been very quiet in terms of their commitment to this. We have not heard from our Member of Parliament on this issue and we haven't heard from federal MPs in this area, nor the federal minister here, so I'm wondering if you have any information for the folks of Yarmouth and the tourism industry on what the federal government is saying or where they are on this, because I know that is a necessary component of putting this project together and I think there's just a bit of anxiety in the public and amongst business operators about where their level of commitment is on this. So if there is anything you're able to share that I can disseminate to anybody who asks, I would greatly appreciate that.
MR. PARIS: I'll just say a couple things in response. We share something here. I want to acknowledge that we also - I also - feel that the federal government is a necessity. There's not only the reconstruction or the construct of an adequate terminal, there's also the issue around customs and security that I would trust - it's a federal initiative so we can't do this without the feds being involved.
We've been talking to the feds about the Yarmouth ferry. We've been in government for four years and how many months? That's the length of time (Interruption) Thank you. It will be four years in June. That's the same amount of time that we've been talking to the feds about the Yarmouth ferry. We spoke to the feds before the subsidy was cancelled and we've been speaking to them ever since. We haven't gotten an informal commitment from the federal government in the almost four years that we've been talking about the Yarmouth ferry. That's probably not the kind of news that you want to hear, but that's the truth of the fact and that's the state of play that we're in right now as far as the Government of Nova Scotia is concerned, the Yarmouth ferry, and the federal government.
MR. CHURCHILL: I know the minister is always looking for opportunities for the Opposition to work with the government on various files, and I think this would be a great opportunity for us to join forces in applying some pressure on the federal government to move forward with a commitment in a timely manner.
This project is not going to happen for 2014 if all the pieces aren't put together this year. Having that new terminal, ensuring that we have port status and that we're able to have customs in Yarmouth is a necessity too. We don't know if we're even going to maintain our port status, and if we lose that before we get a ferry back then the whole thing is gone anyway.
I know the minister will work with me in convincing the Third Party in the House to perhaps join the fight and help use their connections with the federal Conservatives to get this project on the radar and moving. The minister has my commitment as an Opposition member to work with him on that effort whenever the opportunity arises, because we're at a critical juncture right now in terms of seeing this happen and I fear that if we don't put the pieces in place this year, then they're not going to be in place in time to get a ferry back before the accommodations sector in our area - and probably other parts of the province - is gone and that would just disallow us from being a destination anyway, and will further hurt the economy in those rural parts of the province.
Perhaps the federal government is waiting for word on the RFP process - I don't know. Perhaps they're waiting to see if a company comes forward that's able to do this. I know that the public has not heard very much in terms of the RFP process, and I know there is a certain component of this that needs to remain confidential and that you can't share specific details with proposals with the public because then the other companies will see what those companies are offering and it would make the process less fair.
In terms of a timeline, I realize that the first RFP process did not yield the results that were desired by anybody - the province nor our municipal leaders. That has then pushed the completion date of this project off for another year, when we were hoping to get it in for 2013. In terms of timelines right now, where are we in redeveloping that RFP process?
I think it was the department that mentioned the previous RFP process might have had some flaws or restrictions that made it difficult for other companies to engage in it. I know they wanted to work out the kinks of that RFP process, so where are we in terms of timeline of fixing the perceived flaws or whatever in the previous RFP process and starting that process again as quickly as we can to see what level of interest is out there?
I know there are some companies that have been chomping at the bit for this and have been sniffing around because they're interested in doing this run. I've talked to a few of them myself, but the public doesn't necessarily hear what's happening in terms of this. I'll be frank with the minister, a lot of people think that this isn't going to happen and there's not a sincere effort to see this project to fruition because of that lack of information. So where are we in terms of timelines of revamping that RFP process, getting it out there and having a closure date on when the proposals are due?
MR. PARIS: I scribbled down a few things, at least five things that I heard in your questions and I hope I got all five of them.
You first commented about being on the federal radar. I want to say that I think we are on the radar - I think we've been on the radar for almost four years. What hasn't transpired, what hasn't happened is for us to get a formal response from the federal government. I think we are in agreement that possibly to get the federal government to formally respond is going to take - it may be a collective approach, I don't know. I'm not convinced that the Liberals offering support - I don't know how much that would faze Mr. Harper, if at all.
That's one thing, and the other one I wrote down is around timelines. I want the member for Yarmouth to know that we will be issuing an RFP that is going to be quite imminent with respect to a timeline. We've already been talking to some potential ferry operators - I think it's important for the member to know that. One of the things we said was we were going to set out a modified RFP with respect to a ferry operating out of Yarmouth. Part of that modified RFP meant that we were going to connect, we were going to call, and we were going to reach out to potential ferry operators and hear from them, have some input from them with respect to the RFP. We've done that, so we've always been reaching out to potential ferry operators.
The member mentioned about the public and about maintaining a connection and a contact - throughout this time period, we have been very much involved and certainly well-connected with the Nova Scotia International Ferry Partnership. They've been one of the stakeholders that we've had ongoing consultation with, so I think it's important for the member to know that. When we think about the ferry, and I've often used the term about "winning conditions", and for us to have the winning conditions for a ferry to operate out of Yarmouth is going to take an effort by all of us. It's going to take an effort, and I know that the member for Yarmouth appears to have a pretty reasonable rapport with his colleagues to the left of him, and if that's the case he may, at some point in time, want to engage his colleagues and see if they are going to be supportive and offer some suggestions as to what or how they can support the effort.
MR. CHURCHILL: I'll definitely keep on the members of the Third Party to keep pressure on them to support the ferry. I know the provincial caucus has been supportive of getting our ferry service back. The key will be to get the feds on board, but perhaps the minister is right - having a Liberal yell at the federal Conservatives isn't going to necessarily encourage them to act swiftly, so maybe we just have to defeat them, I guess, in the next federal election. I know that the federal Liberal Party is committed to investing funding in the Yarmouth ferry, as is our provincial caucus, so perhaps the minister is correct, and perhaps that's the only answer - and I'd be interested to know if the federal NDP caucus has committed to that project as well, because I do know that the federal Liberals have.
Just to shift a bit - and sorry, just more specifically, I guess, on the RFP - the minister mentioned that its release would be imminent. Does that mean that it will be released within the next month, within the next number of weeks, the next number of days, if there is a specific timeline that the minister could provide, and also a close date on receiving those proposals? Just so that, I think, we have a better sense of when a realistic start date is for a ferry - I think having an understanding of the time frame of the RFP would be very useful, and so I guess I'll leave that quick question with you until we move on.
MR. PARIS: I will say, through you, Mr. Chairman, to the member opposite, that by being imminent, it does not - to me that translates into weeks, not months.
MR. CHURCHILL: That's exciting news, Mr. Minister, and thank you for that.
In terms of a timeline on how long that RFP will be open - do we know when the close date is going to be, when the deadline for proposals will be?
MR. PARIS: Mr. Chairman, I mentioned earlier for the Yarmouth ferry, what we were doing would be a modified RFP. Another part of what that means is that even when we put out the call for the RFP, we will continue to dialogue with potential ferry operators. We want to ensure that those that will be potentially bidding on this are going to be interacting with us.
The last thing we want to do is issue an RFP and be caught in the same place we were the last time. Now the last time was a little different, it was a little rushed. We knew and we appreciated that but in this case we are going to be talking to potential proponents, potential deliverers of a ferry so that they can prepare the best possible proposal that they can do. This is going to be done over a period of months. I'm not going to use the words "take our time", but we're going to make sure we have the time to get it right. I think the member will acknowledge that time is not on our side, so to speak. We don't want to close this off and then when we open up the envelopes we find out that they didn't include this or they didn't include that. We're going to be very engaged with them - they're going to be free to ask us questions, what we're looking for, what we're seeking, and in turn we're going to be asking questions of them.
This will be a different kind of RFP, but we suspect it will be one that's going to be very thorough and leaves no stone unturned.
MR. CHURCHILL: I assume that means the deadline is going to be a flexible one, to ensure that we do not limit ourselves in terms of timing, to get all the relevant information that we need from those companies, and perhaps that's a good approach.
Now, on to the state of the accommodations sector - we've had a chance to chat about this before. Over the course of the last three years, in Yarmouth alone, we've lost over half of our rooms. I think in 2009 we had approximately 900, or a little over 900 rooms in Yarmouth for people to stay. Now, after losing a hotel, a number of motels, bed and breakfasts, we have about 363 rooms left. In discussing the issue around the ferry and the state of the tourism sector with local businesses, they are really at a critical point right now. Some of them are just hanging on in the hope that a ferry will come back, so they can salvage what's left of their business.
Others are of the opinion that they're not going to be able to hang on and we are at risk of losing more of that critical tourism infrastructure, which is needed if we're going to be a destination for American visitors, or for visitors coming from anywhere. It's been far- reaching - Pictou Lodge, which I think went into receivership and perhaps is being purchased right now, they even said they lost 700 rooms as a result of losing the ferry.
I've talked with tourism operators across the province and they have lost anywhere between 10 per cent of their room bookings to 50 per cent, and that is from every region of the province - Yarmouth, Shelburne, along the South Shore, all the way up to the other side in Cape Breton, and some places in the Valley as well. I know that because of the Digby run - Digby has done okay and some areas in close proximity to Digby, throughout the Annapolis Valley have been doing okay because of that traffic that has been coming in through Digby.
I sincerely believe that we are at risk of losing more of that critical infrastructure which would put us in a terrible place if we get a ferry back and we don't have enough rooms to accommodate the visitors. I know that this government did come forward with a lifeline for the Rodd Grand Hotel, I think that was two or three ago, with half a million dollars given to the hotel for upgrades and the other half million would be given to cover their losses, and the province has since issued another funding announcement to give more money to the Rodd to help with the convention centre and to ensure that we can host World Junior A Hockey again, which is a great event for the community, and it brings in a lot of dollars.
The precedent has been set in keeping the Rodd Grand Hotel alive with an infusion of funds to cover losses, and there are other inns, bed and breakfasts, motels, and I'm sure hotels, all over the province just hanging on and might close if they are not given a lifeline as well. So my question for the minister would be, where did the money to give to the Grand Hotel come from, and is there money available to help some accommodation places that many not survive another season without a ferry?
MR. PARIS: First I want to start off with the Rodd and the investment that the province made in the Rodd - and by the way it did come through the Jobs Fund. That investment was made because we realized that Yarmouth was hosting a world-class event and it was directly related to the Rodd, that the economic spinoffs from the hockey challenge were not going to be realized if indeed the Rodd wasn't there to operate. I have to say, and I appreciate and heard the member talk about some numbers when it comes to tourism, when it comes to accommodations, and I just want to piggyback on that and say that when we look at tourism overall we look at tourism in Canada, and tourism in Canada for the past year there was a total decrease in tourism of 18 per cent, tourism in Nova Scotia was down 9 per cent - tourism is being impacted all over Canada.
I also have to say that when we talk about tourism we talk about Yarmouth, we talk about the Yarmouth Ferry, and when I talk numbers around tourism numbers and the percentage of it down, in 2009 tourism in Yarmouth was already at a decrease of 76 per cent. I mention that because that was prior to the demise of The Cat ferry, so I wouldn't want individuals and people to put too much emphasis on the ferry when it comes to tourism numbers. When tourism started to decline in southwestern Nova Scotia in 2001 - and the statistics will show that there was a steady decrease downhill from 2001 right up until the subsidy for The Cat was eliminated. The ridership on the ferry operation was nearing 75 per cent, so we had a situation of a boat, for all intents and purposes, running certainly nowhere near capacity. For all intents and purposes, it was an empty vessel.
We hope that with the new tourism strategy - and I mentioned earlier the "Take yourself there", that we can encourage more visitors to Nova Scotia to take in road trips. Our goal is that they will explore all parts of Nova Scotia. I don't mean just the one visitor do the whole thing - when I say that, I'm saying the visitors will visit various parts of the province, from Cape Breton all the way down and including Yarmouth.
So we're taking a very province-wide approach towards our strategy. We have to in tourism - a $2 billion industry here in Nova Scotia - we are competing with the world; we have to compete against a high Canadian dollar. I know that there are many of us that like it when the Canadian dollar is high because many of us will shop in other jurisdictions other than Nova Scotia and we get the benefit of that. A high dollar in Canada does have an impact, but it's an accumulation of other things as well.
People now - and it's a growing market - more people every day do Internet shopping; they do comparison shopping. I often take into comparative shopping and the difference from me taking a vacation - and I like to vacation in Nova Scotia as much as possible - and then the consumer is weighing the options because now you can go on-line and if you want to take your family on a vacation you can spend anywhere from $1,000 upwards for a family of three, or sometimes four, depending on when you want to do this.
Places like Cuba - I think Cuba is the perfect example - I can vacation in Cuba at the cost of $750 for a week, including all of my beverages as part of the package, and my flight there. I can do so much on that $750 with that Cuba vacation, and I look at air traffic alone and Canada - if I wanted to say, look, I want to go up to Cape Breton, if I wanted to go to Cape Breton, I don't know the last time you looked at air flight from Halifax to Sydney, it's cheaper for me to go to Cuba for a whole week, all-inclusive, than it is for me to get on a plane one way to Sydney. There's something to be said about that.
We also are competing against cheap flights in the U.S. I know there are many Canadians who are now going to airports near them, that are U.S. airports, whether it's Bangor or Detroit, or I guess it would be North Dakota, Alberta - I'm getting my geography here - or even down to California, you can get flips down there from city to city for $29.95. We are competing against the world, but we have so much to offer here. Access has always been a problem for Nova Scotia, and it's more so today than it has been in past years.
There is also an issue around passport requirements. Now, what we have to go through for a passport, and security is much stricter now today than it was 10 years ago, some people see that as an inconvenience; others see it as just a way of life and are willing to live with it.
We have so much to think about when we think of tourism, what we are doing is we are really putting a real concentration on road trips. We want to encourage - we think if we can get road trips here in Nova Scotia we think we can get cars going down to Yarmouth, and we can get them going to Cape Breton. Cape Breton certainly has some advantages when it comes to the scenery, but we do have so much to offer. We certainly want people to explore as much of Nova Scotia as we can.
I mentioned about an 18 per cent decrease Canada-wide with respect to tourism, and Nova Scotia being down 9 per cent. I think a lot of people may say, minister, you should be satisfied with that - those are numbers that I, as minister, and I trust that staff, we don't want to brag about. We want to see those numbers on the plus side - we are doing some heavy advertisement in Ontario this year, and we're doing more advertising in the Province of Quebec with the anniversary at Louisbourg. We want to focus on first-time visitors to the Province of Nova Scotia.
We want to focus on those visitors who want to experience the outdoors, what Nova Scotia has to offer in the way of outdoor tourism. We want them to do the whale-watching, go deep-sea fishing, we have beautiful hiking trails, beautiful scenery that we want them to explore on their bicycles, the individuals who travel in their car - these are the ones we want to attract because they are big spenders. They like to spend. They come up in their cars or they arrive here in their cars and they load the trunk with goodies from Nova Scotia.
So we are doing a real effort on marketing tourism towards our first-time visitors. I can't help but talk about cultural tourism, I think of southwestern Nova Scotia, it has a lot to offer from Shelburne, Birchtown - and I trust the member is well aware of the African Nova Scotian Cultural Museum that will be opening up in Birchtown. This is an amazing feat, as far as I'm concerned, by the Black Loyalist Society of Nova Scotia for them to raise the amount of money that they raised in a relatively short period of time to build a museum. What we often forget - and maybe some of us don't know - Nova Scotia is the birthplace for the African Canadian community. It all began here. We forget about that, or in some cases we don't know about it.
To the South and the southern U.S. and along the Eastern Seaboard we literally have $53 million being spent by African Americans on cultural tourism in the United States. We want some of that. We have the Acadian population here in Nova Scotia, the French-speaking community, and we have deep connections with Louisiana, all throughout the United States - and we want to take advantage of those things.
One of the things I said the other day is that we've done some things in cultural tourism, but it has been limited. We've been very exclusionary in who we market ourselves to. Do we have ties with Scotland? Well, yes we do, but Scotland is only part of it. I mean, because we are a diverse community - you know, we have a rich Asian population in Nova Scotia, mainly due to academics, because a lot of members from the Asian community have come here to pursue education. They end up getting a job here and they invite family here. The Asian market is an unexplored market for us right now, and we want to explore that market. We know - and this comes into our relationship and our partnership with the Canadian Tourism Association, because they are working on the Asian market - I decided that it was important for us to be there. I think the Asian market is not ready for us for tomorrow, but next week it may be, so it's important for us to be part of that and stay on board with that.
I say this all so that the member from Yarmouth will have - and look. I know where you come from when you talk about the Yarmouth ferry; for Yarmouth residents, I know how much that must tug on your heartstrings. I've talked to enough people from Yarmouth. But the Yarmouth ferry was a piece of the puzzle and, again, the ridership was decreasing overall - the tourism numbers were down in Yarmouth. And what we're doing now is we want to up those numbers. We want to work with you. I've had meetings with Mayor Moody, and I've had meetings with other individuals. I remember Yarmouth 250 and all the work that our department did with Yarmouth 250.
So, Mr. Chairman, before I sit down, I just want to say to the member for Yarmouth that, as minister, I feel your passion, I appreciate it, I understand it, and nobody on this side of the House would be doing anything that would deter visitors from going to Yarmouth.
You know, we are not mean-spirited individuals. We want to work with Yarmouth as much as we want to work with Sydney, as much as we want to work with the Valley, as much as we want to work with the North Shore, as much as we want to work with Pictou County, as much as we want to work with all stakeholders in the Province of Nova Scotia to make tourism in Nova Scotia all that it can be.
MR. CHAIRMAN: Order, please. That brings us to the end of the time for the Liberal caucus.
The honourable member for Cape Breton North.
MR. EDDIE ORRELL: Mr. Minister, while we're on the Yarmouth ferry, and talking about tourism numbers, and tourism numbers being down, before the ferry was - the subsidy, I guess, was eliminated for the ferry - do we have an indication on what those tourism numbers have been since the ferry has been taken out of service on tourism in that area?
MR. PARIS: Last year, room nights in Yarmouth were up 4 per cent; visitation in Yarmouth was up 2 per cent. So, overall, Yarmouth has done, under the circumstances - I don't know if I want to say "reasonably well," you look at tourism in the Province of Nova Scotia being down 9 per cent from the previous year, we've got a ways to go yet, so Yarmouth has experienced some increase. I've already talked about how the road visitations and part of "Take yourself there," that's what that is about. That's about people - the visitors - hopping in their cars, driving to the Province of Nova Scotia, continuing on the journey down to Yarmouth or up towards Sydney.
We want to encourage more individuals to come to Nova Scotia using their vehicles. Hence that's why we've done a more concentrated effort on Quebec and Ontario this year when it comes to visitation. We contribute to the Atlantic Canada Tourism Partnership - ACTP - a million dollars a year to that. Part of that money is used - we do a partnership with New Brunswick about overseas traffic. I see that as a good spin for us; I think we're up with Germany visitation. I think that's a win for us because - and that goes to the Halifax Stanfield International Airport because we are the largest international airport in Atlantic Canada, so I think that's all of a bonus and a plus to us.
We are concerned about tourism; we are looking to increase the numbers - Yarmouth and Cape Breton included and all points in between.
MR. ORRELL: You said there was an increase in tourism last year in Yarmouth, but if I recall, last year in Yarmouth we had two major sporting events that would have filled hotels in that area for the two weeks that they were on. There was a million dollars injected into a hotel that was there to make sure it stayed open and had the upgrades.
I'm talking since the ferry closed, since the ferry stopped - what are the numbers? Not last year compared to the year before, because the year before it was down because of that. I want to know the numbers since the ferry closed - what was the percentage of it and how was tourism affected by it?
MR. PARIS: Those numbers since the ferry's demise - we can get those numbers. I will say that, yes, for Yarmouth in hosting the Hockey Challenge was a huge event for Yarmouth. I've got to say that as a result of the huge success of the Hockey Challenge, Yarmouth is hosting it again for two years in a row - I think that speaks volumes for Yarmouth as a host. And for us not to invest in the Rodd would have meant that championship was not going to take place; they are connected.
Yarmouth is - and I don't know if I want to call it "unique" because I think every place in Nova Scotia is unique in its own right, but certainly one of the things that Yarmouth and we have, in Nova Scotia, going for us, when we host events such as the Hockey Challenge - as Yarmouth hosted - or anyting that we host, what makes it so impressive are the volunteers who come out for these events, the attitude of the people of the host community wherever the host community may be. What people are so enthused about when it comes to Nova Scotia are the people.
We have so much to offer, so much to give. It reminds me of the story, when it comes to tourism, when Vancouver hosted the Winter Olympics and how popular the Atlantic Canada Pavilion was, especially on Nova Scotia Night and how people waited for hours in Vancouver just to get inside the Atlantic Canada Pavilion, just to be part of Nova Scotia Night because they were assured of a number of things - first and foremost, they were assured they would have a good time. And they were going to have a good time because it was an event that was going to be hosted by Nova Scotians - and nobody, nobody, in Canada parties better than Nova Scotians and we do it in such a respectful and happy way.
I think we have a lot to offer. The member for Cape Breton North brings up about the ferry and I have to be mindful that the ferry at the time of its - if I can use the word - "demise", was an empty ferry. The ferry was riding empty. I remember as a kid going to Yarmouth and seeing the hustle and bustle when the ferry came in. But in recent years, those few people who were travelling on the ferry, when their tires hit the asphalt in Yarmouth they were off to somewhere else. They were headed for Cape Breton or Halifax - the few who were using the ferry just weren't staying there.
In the three years that we've been here there has been a lot of talk about the Yarmouth ferry on all sides of the House, including on this side as well. The ferry itself was a tough decision. I think as a government in our early years it probably was the toughest decision that we made at that particular time. We've had some tough decisions since, but I can remember the ferry being a tough one.
I know I've spoken to individuals from Yarmouth who often talked to me about tourism. They talk about tourism, these are Yarmouthians who talk about Yarmouth being branded as a tourism destination or re-branded as a tourism destination. There has to be drawing cards for tourists to go visit an area. They've spoken to me, there are some that live and die about the lack of a ferry service in Yarmouth and there are some individuals that no matter what I say, no matter what I do, they will believe that the sun rises and sets on a viable ferry service for the Town of Yarmouth.
I think that Yarmouth has a lot going for it, I can remember vacationing there with a young family and just enjoying the beaches. There was a particular campground that I used to go to, it's got a lot of attractions. I often say jokingly one of the attractions for Yarmouth is the Frenchys and I know many people who go on a Frenchys run with destination is Yarmouth, and I'm saying is there any way we can piggyback on that. The member for Shelburne, the Minister of Fisheries and Aquaculture, saying that there is two Frenchys there, already he knows more about Frenchys run than what I do. I often wondered where he was getting his treads at.
I appreciate that the member is concerned about Yarmouth and I think we all are, we're concerned about Yarmouth and we are concerned about Cape Breton. What I've said and what I've maintained is that we need every Nova Scotian, in particular every member of this House to be tour guides for the Province of Nova Scotia. We need tourism operators here and I've often maintained that tourism is everybody's business. I recall just coming out of my Halifax office on Hollis Street and if I see a group of individuals there with a map out I assume that they're looking for directions and I walk up to them politely and ask, are you lost, do you need directions? I've been walking through the Grand Parade and I've seen people in the Grand Parade and I've asked, would you like me to take that picture so you can get in it?
I always get annoyed when I'm driving and I see individuals throw garbage out of their car and I say there's something that is a great deterrent for tourists when they come and they see garbage on our roadways and in our ditches. We all have an obligation; we all need to be proactive right now. What happens in Nova Scotia, sometimes we see things happening and for whatever reason or reasons we don't want to get involved. Well, I say to Nova Scotians it is time to stand up, it's time to get involved - if we're going to make Nova Scotia all that it can be, we need the combined, the collective efforts of all of us, and this has nothing to do with politics - either big "P" or small "p" - it's about growing the Nova Scotia economy and making Nova Scotia a better place for all of us.
A $2 billion industry that we can't afford to let - actually, when I think of the tourism industry, and I don't want to compare but I can make a comparison to other industries that we have in Nova Scotia, from fisheries to the forestry to manufacturing to whatever, and I think statistics will show how important the tourism sector is to us and is to Nova Scotia.
MR. ORRELL: I guess you must have misunderstood my question. I asked the numbers - we were quick to get the numbers about last year's tourism being up in the Yarmouth area, I asked what the numbers were since the ferry closed - are the numbers up or down? We're hearing the tourism numbers are down overall, might have been up last year compared to the year before - are the numbers up or down since the ferry closed in the Yarmouth area?
MR. PARIS: If these aren't the right numbers, we're going to ensure that you do get the right numbers. I'm going to give you some more numbers.
Yarmouth County, which includes the Acadian Shores, in 2007, 60,100, these are visitors to Yarmouth-Acadian Shores. In 2012, 49,300 - I don't believe you were asking about hotels, motels, the number of units in Yarmouth. (Interruption) No, okay. What we can do is break this out by year for you and you'll get that before - I don't know if you're going back to Cape Breton today or not, but if you're around for a little bit . . .
MR. ORRELL: Monday will be fine.
MR PARIS: Monday's fine? We will have that for you Monday, a breakdown from year to year since the demise of the ferry.
MR. ORRELL: The question I was going to ask was about the subsidy for the ferry; I think - correct me if I'm wrong - it was $2 million per year. We're hearing numbers from the tourism operators and the tourism industry that because of the loss of that ferry, there has been a loss of revenue in the tourist industry, especially on the South Shore area, of about $17 million or $18 million. The question I have, if the numbers are down and the revenue is down, I guess by taking the $2 million out of that subsidy, we're losing $15 million on the other end, and I want to ask if that was any kind of a number you might have heard or is it something that we've been given false information?
MR. PARIS: Again, in the last year of operation, the subsidy to the Yarmouth ferry was $7 million. That was projected to increase in the out years. In the last year it was $7 million. I don't have that at my fingertips or in any of my notes, the cost of the subsidy to the succeeding years. Again, we can get that information to you. The last year of operation, the subsidy was $7 million and that was projected to increase in future years and the ferry operator at the time was in the process of trying to negotiate future costs and what the increase would be - also for the length of the agreement as well.
MR. ORRELL: Even if it's $7 million and there was a $70 million spinoff from it, we hear - and we hear it every day in this Chamber - that the spinoff from the 200 jobs that are developed or created in Stern equal 1,400; the jobs that are going to be created because of the Irving shipyard are going to be 1,200 or 11,500 for the thousand jobs you created - so the spinoff from the ferry being there, the effect of the tourism, there will still be a $10 million gain to the tourism industry.
We just heard about the problem with people when they got off the ferry, when the tires hit the road they were heading to places like Cape Breton or the Annapolis Valley, but if those tires aren't hitting the road, they're not heading to those areas.
I've heard from tourism operators as far as Cape Breton that their bus traffic was down. A lot of that bus traffic was traffic that came across on the Yarmouth ferry that ended up being part of the tourism industry in Cape Breton, doing the Cabot Trail, a beautiful section of the province, doing Louisbourg and getting into areas that if they go around the other way in through Richmond and Louisdale, which are all beautiful parts of Cape Breton Island, but without those tires hitting the road, those people aren't getting into those areas and they're not probably coming. Once they get to Halifax, if they drive around, some people just won't go three hours one way or four hours the other way.
We're now looking at securing another operator for the Yarmouth ferry, but I guess my question is how beneficial was it to close one operation before we start another operation if we're losing $10 million a year in tourist revenue?
MR. PARIS: A couple of things in the question - first of all, what we were looking at when the subsidy was declined by the province was a service that was in decline; a service that had been in decline since 2001 with a decline of well over 75 per cent. That decline was projected to continue and continue and continue. What we are looking at today and what we've committed to as a province and what we've said is we are looking for the winning conditions for a ferry operation in Yarmouth that's going to be sustainable; that's going to start off here - wherever "here" may be - but at the end of the day, when it's all said and done, that there are going to be profits.
The Cat ferry in its heyday was losing money. The decline of the ridership at the Yarmouth ferry started in 2001. It was a steady downward spiral from 2001 until it actually did not exist anymore, so we're talking . . .
MR. CHAIRMAN: Order, please. The time allotted for consideration of Supply today has elapsed.
The honourable Government House Leader.
HON. FRANK CORBETT: Mr. Chairman, I move that the committee do rise, report progress and beg leave to meet again.
MR. CHAIRMAN: The motion is carried.
[The committee adjourned at 1:19 p.m.]