HALIFAX, WEDNESDAY, APRIL 4, 2018
COMMITTEE OF THE WHOLE ON SUPPLY
Ms. Suzanne Lohnes-Croft
MADAM CHAIRMAN: The Committee of the Whole on Supply will now come to order.
The honourable Government House Leader.
HON. GEOFF MACLELLAN: Madam Chairman, would you please call for the continuation of the estimates for the Department of Justice.
MADAM CHAIRMAN: The honourable member for Dartmouth South.
MS. CLAUDIA CHENDER: Yesterday, we were discussing the cannabis rollout. I had some questions about the costs that would be incurred, and I may yet have more questions about those, but I want to move on to the number of locations.
We know that New Brunswick, which has a similar model, is pursuing a similar model, provincially, they are beginning with 20 retail locations. Here in Nova Scotia, we are starting with nine. My understanding is that all nine of those locations are in easily- existing facilities owned by the province that can be retrofitted. My understanding is that the eight stores that will be opened within NSLC footprints were previously Bottle Your Own Wine locations that could easily be retrofitted to be stand-alone rooms, and the stand-alone store, the old Clyde Street liquor store, was sitting empty anyway.
That makes sense, although I know that my colleagues in the PC caucus pointed to some information that shows that perhaps building a single replicable template of a stand-alone store might, in the long run, be cheaper for the province, because it could be easily built around the province.
Perhaps that will come, but there are a couple of issues, beginning with nine locations. The first one I want to ask about is, we know that we are always - and we hear this from the government a lot - looking for employment in rural areas in particular. My sense, from talking to people around the province, is that a few jobs, particularly a few Nova Scotia Liquor Corporation jobs, in many rural communities would be very, very welcome.
I wonder why, notwithstanding the issues around co-location, and I’ll get to that next, the government saw fit and the ministers saw fit to begin with only nine stores, which leaves huge swathes of the province, including, I believe, the minister’s own riding, without access. I know that there is online access. We know that there are issues with Internet connection. We have spoken recently about that in this Chamber.
Beyond that, we also know - as a former salesperson myself - that people take the path of least resistance. We know there’s a huge black market. We have been told that one of the main reasons for legalization is public health and safety, to create a safer path and to create safer access. Frankly, I think it’s unreasonable to think that online sales are going to make much of a dent in the black market, particularly for people who are currently consumers of cannabis. I would like to ask the minister to speak a little about why only nine locations were chosen for the entire province.
HON. MARK FUREY: I would be pleased to expand on the comments that my colleague has advanced and shared. There’s a couple of contributing factors that my colleague may be aware of, but I’ll share them for the benefit of my colleague and others.
This is a huge undertaking. I have said before that this has been a very complex file with significant challenges for provinces, territories, and municipalities. Those complexities are present for the Nova Scotia Liquor Corporation as well in their ability to stand up that retail model at the time ready for July 1st. The CEO of the NSLC, Mr. Bret Mitchell, in our joint public media session, indicated that this was the single-largest project that the Nova Scotia Liquor Corporation was asked to undertake, the stand-up of nine retail outlets in four and a half months.
Now we know, based on circumstances in Ottawa, that that period of time is being adjusted slightly based on the agreement made in the Senate to schedule a vote for late June. That was one of the contributing factors, that they did not have the capacity to stand up more than the original nine by the initial identified date.
The other factors that contributed to that - my colleague has alluded to that space within existing facilities. The Nova Scotia Liquor Corporation had a business model to pour your own wine. That business model was not what they thought it would be. They had already started to transition out of that model. For six of the nine stores, that was in fact the case. They were prepared to transition out of that space for Bottle Your Own Wine and use that for the cannabis retail element, what I call the space within the space. That in itself was a contributing factor for six of the nine stores. Two of the stores in HRM had a larger footprint, square footage where there was space available without imposing on existing space. Those two stores are able to transition. Of course, the final store that my colleague has alluded to is the actual cannabis retail site itself, located on Clyde Street. Those were additional circumstances.
The information that I have and the dialogue that we have had with the Nova Scotia Liquor Corporation, when you consider cost and timelines and available space, this was the model that addressed the pressures that the Nova Scotia Liquor Corporation were facing in standing this up by the target date. It also addressed government’s need and desire to see that retail storefront present and available by the legal date.
My colleague has alluded, as well, to the online home delivery element. We were conscious of what I call the retail store gap, when you look at the geography and map of Nova Scotia. But we were confident that the online home delivery option would meet the needs of all Nova Scotians if they chose to order online.
Yes, we’re all challenged by the availability of quality, high-speed Internet. As I have mentioned in other public discussions, we know that Nova Scotians commute short distances to core communities. In my own community in Lunenburg County, Bridgewater is the core community. People often travel in from Colpton and New Germany, more geographically removed from the core, for the opportunity to access high-speed Internet when they’re in the core communities for purposes of doing those types of orders. It’s not the most convenient, but it’s certainly an option that we saw as important to have as part of this retail platform given the timelines that we had before us.
MS. CHENDER: With respect, if we look at this average sales process - I’m not an expert on the procurement of cannabis. Otherwise, I probably wouldn’t be in this Chamber.
But I hear tell that people call a guy, and they see the guy, or the guy shows up at their house (Interruption) Or gal. That’s pretty easy. To replace that sales path with someone getting in their car, driving maybe 20 or 30 minutes, going to the public library, and ordering cannabis that might arrive in two days or might arrive in a week - I understand the pressures of the timelines, but with all due respect to the minister, the argument falls down a little bit for me.
Also, while I am conscious of the pressures on the NSLC, as I said earlier, we have been told time and time again that safe communities are the linchpin of the reasoning behind this legalization project. Last Fall, we saw the rollout of pre-Primary. According to our freedom of information requests, there was very little planning or site selection that happened, and the whole thing got up and running with many more sites than this in a much shorter timeline in public buildings. Kudos to the Minister of Education and Early Childhood Development, I guess.
All of that is to say (Interruption) It’s a weird analogy, but actually, it’s an important analogy because this is about safety. This is about the health and safety of our communities.
We heard the argument about pre-Primary that we want to make sure kids have access, that they’re in safe spaces. This was the argument for the school. We have heard that the reason we’re having the cannabis rollout in the context of the Nova Scotia Liquor Corporation is so that there is safe access for people, particularly with the lower age limit than some would have liked, that they have safe access to those products.
I would ask the minister whether there are currently plans to expand to more locations. In particular, I’m thinking about the black market. I had occasion to watch a news clip last night where the dispensaries said, it looks like they’re trying to make us illegal. That’s okay. We’ll just change our business model. That’s easy for us. We’ll just become a delivery service, no problem. Lots of people operate that way anyway. The black market, I would say, is going to be extremely persistent and pernicious in this particular file, and it’s going to be around for a long, long time.
I’m curious to hear, given that this decision has been made, what the plans are in terms of number of locations or other initiatives to combat the black market, which we have heard is the purpose of the legalization of cannabis.
MR. FUREY: My colleague has identified a number of key elements, and I welcome the opportunity to expand on those discussions. My colleague is absolutely right - the two priorities are the health and safety of Nova Scotians. That may seem like a little bit of an irony when we’re talking about the legalization of cannabis, but I think what people are missing in this discussion is the product that is available through the illicit market.
I shared an example here last night of an undercover operation that I was part of and spoke about the sheer volume of herbicides and pesticides that were going into quality plants that were securing the highest prices. We’re hearing examples from my colleagues about other chemical elements being introduced into the product to maximize volume, sale, and inherently money - profit. The ability to legalize a product in pursuit of public safety is about providing a quality product analyzed by Health Canada and approved for retail sale. That’s one element of the public health and safety objectives of this legislation.
The other element that my colleague spoke about around the illicit market - I have said this publicly before as well. When recreational cannabis is legalized, whatever that date may be this summer, there is no switch that we’re going to flip, and people stop purchasing from the illicit market and transition to the legal market. That’s not going to happen. There will be progressive transition, and that’s going to take time. It will take factors that will be important to that transition. The price point is going to be important. The availability of the product is going to be important. People’s ease of access is going to be important.
We understand that, but we have to do it in a fiscally responsible way. I would like to create employment opportunities in my community at my Nova Scotia Liquor Corporation, which presently doesn’t have the cannabis retail option. But in fairness to all Nova Scotian taxpayers, I can’t simply create jobs for the sake of creating jobs. We have to justify that. We have to rationalize that. We have to be responsible in the larger picture to the rollout and the complexities associated with this legislation and the legalization of cannabis.
We have had extensive discussions with our colleagues across the country. We have been informed by their decision-making process. We have been informed by the outcomes that they have landed on. We have done similar work with Colorado and Washington State. Much of that work has informed ourselves along with the work that our team has done to land where we have.
At the present time, we believe there is strength to the regulation, and there is a lens of common sense and sound judgment - what I call a measured approach to this application, because it is complex. It’s important that, over the next number of months, we will monitor the progress. There will be mining of data to determine what circumstances are evolving. Is there a need for us to adjust any area of the legislation? One of those areas, to my colleague’s question, is that area of additional retail outlets. As we speak, we don’t know what the uptake will be to that storefront retail option.
I believe there’s still going to be a desire for anonymity in the purchase of this product although it’s legal. There’s still a stigma attached. People will transition from that over time. I understand that. We don’t know what that retail sale is going to be. We don’t know what that uptake is going to be to that online purchase and home delivery option.
The other element that may meet people’s personal needs is their ability to grow the product at home, up to four plants per household. Those are some contributing factors that we just don’t have that foundational information on to make future decisions.
What I will say to my colleague and others who are listening is that those are discussions that we will have going forward. I caution people as to the expectations. There may be evidence supported by data that says there’s a need to expand, but there may be evidence in data that suggests we have to close any one of those retail models because it doesn’t meet the needs and expectations.
I’m very cautious in the approach we have taken to the legalization of cannabis and the elements that are contained within the bill. These are points that my colleague has raised that will form part of future discussions and how we respond appropriately to either the expansion or contraction of that retail model.
The other element that becomes critical to this and will come upon us very quickly is the opportunity to access retail edible products. I believe that 12 months from now, we’ll be having a different discussion, and that retail model may in fact change.
Hopefully some of that information is helpful to my colleague, but the points she has raised are valid. These are points that we have discussed internally. We have had some great discussion, and I think we’re positioned well. Those elements that my colleague has shared are important to future dialogue and the analysis that we will continue to give to this piece of legislation and the retail model that we have advanced.
MS. CHENDER: Thank you to the minister for that answer. It was helpful. Who knows? Maybe one unintended consequence will be an increase of library funding for all those computer users.
With that, I want to shift to some questions about access to justice generally. The minister discussed Jordan’s Principle in his opening remarks. I want to start by asking if the minister could tell me what the average wait time is now for booking a courtroom in Provincial Court.
MR. FUREY: I know my colleague may be familiar with the timelines identified by the courts, 18 months for provincial offences and 30 months for Superior or Supreme Court offences. I’ll just give the statistics for my colleague.
So far, what we have experienced are 26 applications to stay that have been tracked by the Public Prosecution Service. Four of those were granted, 17 were dismissed, and two were withdrawn. What we have experienced is a 25 per cent decrease in those circumstances, and that’s driven by a number of factors.
My colleague may be aware of the Criminal Justice Transformation Group that exists within the province. That’s a partnership between the judiciary, public prosecution, legal aid, court administration, Department of Justice, law enforcement - a number of partners who are working collectively to respond to the Jordan decision and ensure that we’re not in what I call a danger zone of matters, particularly the most serious matters being impacted by the Jordan decision.
Just to give my colleague and those listening some examples, the expansion to the adult Restorative Justice Program will help benefit the timelines. The increased use of video court options and opportunities, and the early resolution process that we’re seeing happen have been very helpful. There’s an improved case management program that the public prosecution and Crowns are using.
One of the really significant initiatives implemented is what we call the real-time ticker. It’s an electronic tracker that everybody within the judicial system has access to. On a computer screen, they’re able to identify the timelines associated to a particular case as it moves through the court process. Quite literally, there’s a red tick on that file to identify if there’s a danger zone.
Partners within the criminal justice system are working aggressively to respond not only to the Jordan decision but to the caseload within the criminal court system in the province. We have seen some pretty significant progress. We’re very pleased with the progress. We can’t let our foot off the gas on this. This is something we have to stay on top of. We will continue to look at options and opportunities where we can have further positive impacts on these timelines.
MS. CHENDER: As the minister also referred to in his opening remarks last year, restorative justice was made available to adults. That’s a process that’s close to my heart. I was happy to see that, but I don’t believe the budget has increased, at least not significantly. I’m wondering whether there has been an increase in uptake of that program and how those costs are being covered.
MR. FUREY: The budget allotment for the Restorative Justice Program is $2.6 million. There was no increase specific to the additional responsibility to provide restorative justice to the adult population. I will say this - I think it speaks to the capacity and skill sets of those eight community groups around the province who provide that Restorative Justice Program.
The Restorative Justice Program for adults was introduced in late 2016, and up to the end of 2017, there have been 949 adult matters go through restorative justice as well as 634 youth. When you look at those circumstances - not knowing the details obviously of what criminal charges would be associated to those individuals - that’s a significant savings on court time and inherent court costs through access to legal aid and need of public prosecution and other elements that my colleague would be aware of and familiar with in the criminal court process.
MS. CHENDER: That’s a lot of cases, 949 cases. We know that they may be of different duration and different levels of complexity. Nonetheless, that would suggest that perhaps there was additional capacity in those eight community groups. Otherwise, it would seem that that would be a huge additional burden if they were, in fact, at full capacity.
I wonder, to that end, if there is any process or money budgeted for evaluation of the program. I know the minister is tracking numbers, but to also track workload and effectiveness so that the budget could be allocated accordingly in the future.
MR. FUREY: The Restorative Justice Program is continuously being monitored and evaluated. We’re very fortunate in Nova Scotia that we have a tremendous work relationship with the academic community. Don Clairmont and Jennifer Llewellyn have been heavily involved in these processes. Mr. Clairmont has done a number of evaluations, I think most recently in 2016. We’re very fortunate in those circumstances.
What I think is important as well to recognize, to my earlier comments and my colleague’s comments about previous capacity, is that one of the things we have seen within youth crime as a result of restorative justice is actually a reduction in youth crime. That has built some capacity there. That has enabled them to take on the adult program at the present time without any additional cost. The continued monitoring, to my colleague’s point, is an important element to ensure that the program continues to provide the services it has been intended to provide.
I would say that we’re fortunate in Nova Scotia. The collective work of previous governments and a large civil service group of employees as well as community volunteers, has done an outstanding job with the Restorative Justice Program, to the point that the federal government uses Nova Scotia as the example. This June, I believe it is, the federal government has asked us, and we have agreed, to host a number of our provincial partners in a restorative justice forum here in Halifax. We believe that demonstrates confidence in the Nova Scotia restorative justice model. I think the outcomes speak for themselves.
I’ll be quite honest - I have used the restorative justice model in my previous life. I see the values of it. I have seen how people can contribute in meaningful ways to their community who otherwise would have been down a path of criminal record, incarceration, and all those other dysfunctions that come with those very unfortunate circumstances. It’s a program that I absolutely endorse and support. I know my colleague has a similar opinion and view. I look forward to hosting our colleagues this June and continuing to ensure this program remains successful in the province.
MS. CHENDER: I’m certainly happy to hear the minister mention Don Clairmont and Jennifer Llewellyn. We know they’re national leaders in this regard. It’s wonderful to see a collaboration like that with government and with subject matter experts working on the best way to deliver this programming. That’s wonderful, and I look forward to hearing more about this program as it rolls out and as there’s more uptake, particularly among adults.
I want to shift and ask a question about public consultation. This has been something that we have discussed in relation to various files in this Chamber. The question is, could the minister tell me how much the department spent last year on public consultation? Then I may have a follow-up to that.
MR. FUREY: Just a couple of quick explanatory comments - there’s what I would call internal and external consultation. I used the Criminal Justice Transformation Group as an example of internal consultation where we’re engaging stakeholders within the criminal justice environment, although there would be salaries associated to people’s time, participating in those discussions on a monthly basis. I consider that in-kind, so no direct associated cost. There were areas where we did external consultation. I’ll just mention some of those that would be apparent - the recent consultation on cannabis, both the cyber bullying and the adult protection legislation, as well as our accessibility initiatives. Those are some areas where we have done consultation. I don’t have the actual numbers of what we expended for each of those consultations, but we will be able to get that information.
MS. CHENDER: The follow-up question is, was Communications Nova Scotia used for that purpose at all, in the external public consultation process for any of the things that you mentioned? Is there a budget line this year for expected public consultations?
MR. FUREY: There’s a role for Communications Nova Scotia in the consultation process. As an example, in the Department of Justice, we have three communications persons on staff associated with Communications Nova Scotia. They’re not directly the responsibility of the Department of Justice. Those positions would fall under the CNS budget itself.
Any work associated to those consultations would be a Communications Nova Scotia budget item, actually, not Justice. What happens is, we would be billed for that service and, obviously, would pay that invoice, so it’s not direct resources in the department. The Communications Nova Scotia staff, team members, that we have in the Department of Justice would play an important role both with internal and external facilitation of those consultation processes.
MS. CHENDER: The other question I just asked was whether there was a budget line for the coming year. I know that time is short, so perhaps the minister could provide that information now or after.
My last question - and again, if it needs to be provided later, that’s fine - was whether the member could identify the budget items or lines in this budget that include federal transfers. I know we’re not hearing about cannabis costs because we’re waiting on those numbers, but it would be helpful to understand which items of the budget have flow-through federal dollars.
MR. FUREY: Back to the original question, the CNS budget line - there is no budget line in the Department of Justice. That budget line is actually in Communications Nova Scotia for those types of things.
The piece around the federal transfers, there would be a number of initiatives where we have federal transfers come into the department that are either retained in the department for expenditure or flow through directly to service providers. We will capture that information and ensure my colleague gets that information.
MS. CHENDER: Thank you, and to clarify, it was just a budget for any public consultation, whether or not . . .
MADAM CHAIRMAN: Order. Time has elapsed for the New Democratic Party. We will switch over to the Progressive Conservative Party for up to one hour.
The honourable member for Pictou West.
MS. KARLA MACFARLANE: I trust that if the minister needed a break, he would state, so we’re good to go. (Interruptions) Not at all. We should never assume.
I want to go back to cannabis for a bit and (Interruption) I know, I know. I slept on it last night and now there’s more questions that have stirred in my little brain here.
Can the minister explain the pricing model that will be used with selling cannabis? There has been indication that it would be $10 a gram, but is that for every type of cannabis, and what is the process on taxes and just the actual model of the selling of it?
MR. FUREY: The actual price itself is still evolving. The Nova Scotia Liquor Corporation is working to make those determinations as we speak. They haven’t yet secured a supplier, so they would be in discussions as to what that basic price point would be. In addition to that, we have the federal excise tax, as well as the provincial HST on that product.
My colleague may recall when the Atlantic Premiers had met this past summer and spoke about the importance of pricing in the Atlantic region. There was an agreement - the common price, and the price that was identified in reference at that time, was $10 a gram.
I would say that as these discussions evolve - and part of the unknown that we are experiencing - and districts, regions, provinces, and territories try to land on a price point, that illicit market continues to compress their price, which forces government to give consideration to ensuring that those prices are competitive.
I’ve said before that one of the most significant contributing factors to our ability to transition individuals from the illicit market to a legal retail market is that price point. There are a number of circumstances around pricing, but we are not able to determine what a final price will be until the Nova Scotia Liquor Corporation secures a product provider. Through that work, we will determine what that base price is that they will be buying that product for.
MS. MACFARLANE: I am no math wizard, but if I look at the surplus that was given by the Minister of Finance of $20 million that is based on revenues generated from selling cannabis, there must have been a projected baseline figure to start with. I’m just wondering, can the minister confirm how we ended up with a surplus coming out of the selling of cannabis if we don’t even know what we’re charging?
MR. FUREY: I can’t speak to the circumstances that Finance would have made public, but I would say my understanding is that these are assumptions based on unknowns. We don’t know what the volume is going to be. I know the Nova Scotia Liquor Corporation has done considerable work mining data to determine what those numbers might be.
If my memory serves me correctly, I think they were talking 12 million grams. They talked about a $10 million revenue from that, I think there’s a significant difference between revenue and surplus. We don’t know what the costs are, so until we know what the costs are against that revenue, we won’t know. We believe there are going to be ongoing costs to government, at least in the first two years, until we get through a period where there is some clarity and confidence in these circumstances as the retail model unfolds.
The revenue that the Nova Scotia Liquor Corporation, the Finance Department has spoken about I believe, is $10 million in revenue from that product, and $10 million in excise tax from that product. I don’t know what price they used to draw those assumptions.
MS. MACFARLANE: We all know, and I agree with the minister, there are going to be expenses to the taxpayers with the legalization of cannabis. I know that the federal Trudeau Government has earmarked, I believe, $275 million to help support policing and border protection in an effort to ensure safety. I’m just wondering, what percentage is Nova Scotia receiving out of that $275 million that the Trudeau Government has committed to, to aid in policing?
MR. FUREY: I don’t know what the actual dollar value will be. I spoke to this last evening, the number that will ultimately end up as federal support for Nova Scotia will be a proportion, I believe, based on population. I’m not sure how the federal government plans to distribute it. What we do know is that pot of money identified is for the country over five years, and we will get a small percentage of that. We’re still in those discussions.
MS. MACFARLANE: Fair enough on that answer. Look, we all sadly know that there will always be a market for cheap drugs, and if the illegal drugs are actually cheaper than the legal drugs, I guess there’s not much we can do about it. It’s just going to be a fact. I was thinking about this last night and I’m curious.
I don’t think legalization will actually eradicate the black market at the end of the day. I think it will help, and I think we are all aware of that, but there will always be a black market, and I think that legalizing it will certainly take away some sales.
Does the minister actually have a number of what is currently being made in the black market, and once we legalize it, what the decrease in the black market will be?
MR. FUREY: An interesting question. I think there are some numbers that have been out there in the public domain. The black market price has always landed around $10, give or take a few cents.
Since the discussions around the legalization of recreational cannabis have been advanced, we’ve seen that price compressed to about $6 or $7 per gram. The public figures that are being used - as much as $7 billion annually in revenue is generated within the black market. I don’t have any substantive background or information to qualify or quantify that number.
The point I want to pick up on, and I think it is important for all of us to understand - and my colleague is absolutely right. I’ve been around this environment a long time, and the legalization of recreational cannabis will not eliminate the black market, but I believe, over time, it will have a significant impact on the black market.
There are many parallels to the retail of alcohol. If you go back to the period of Prohibition and when alcohol was legalized, and the presence of bootleggers, the common product was moonshine. My colleagues from Cape Breton would be familiar with that. (Interruptions) My point is Lunenburg County has a history. You’re absolutely right, and I know where I can go if I have to, but only from my enforcement days.
I think there is a comparison here, because I think it actually highlights what my colleague is saying. Cannabis was illegal, parallel to the days of Prohibition. Cannabis is about to become legal, similar to the transition of alcohol from Prohibition to legalization.
In the early days of legalization of alcohol, there was still a significant availability product of moonshine, and as the alcohol retail industry evolved and matured and we saw the number of then-Liquor Commission outlets, now Liquor Corporation - I remember, and I’m going to tell you a quick story. I was working with the RCMP in Shelburne County out of the Barrington Passage Detachment, and my colleague was a radio jockey at CJLS in Yarmouth. I remember him on night shifts - and that’s true. There was no liquor store in the Barrington area but there was a liquor store in Shelburne.
describe the fishing community, and I say this with respect, because I know
some of them are watching and I still have friendships and I want to maintain
those friendships, but they work hard and they play hard. The instant they get
off the water, they were heading to the liquor store in Shelburne. What they
would do is they would go - if they preferred beer, they would buy a two-four
for Friday night but they would buy a six-pack for the drive home. If they
preferred hard liquor, they would buy a 40-ouncer, but they
would buy a pint for the drive home. Those circumstances were contributing to
the incidents of impaired driving.
As the alcohol model evolved, we saw an expansion of Nova Scotia Liquor Corporation stores to the point that a store was opened in Barrington. My colleague and his constituency would be very familiar with this. Lo and behold, that store in Barrington had the highest sale of retail alcohol in the province.
I use that as an analogy of how the alcohol retail model evolved with time to the point that still, to this day, if you want to pick up a pint from the bootlegger, you can do that. They’re few and far between, because of the expansion of the retail model, but they’re still available. To my colleague’s point, I don’t believe that we will ever see an elimination of the black market, but I believe with a prudent, responsible approach, we have an opportunity to maintain that control. If and when there’s an opportunity to expand based on the analysis, based on the work that we will see happen over the next number of months and the first year in particular - as I mentioned earlier, one of the most significant contributing factors to the retail model will be the introduction of edibles at some point in the not-too-distant future.
I appreciate the questions that my colleague has advanced. I believe they’re very reasonable questions to ask, but I think there’s an underlying importance to understand that larger discussion, recognizing that we believe this will evolve and mature. We just don’t know what that will look like.
MS. MACFARLANE: The minister and his colleagues would be pleased to know that that has finalized my questions on cannabis, but I am going to move forward with legal services.
I’m curious in knowing how the department decides when they need legal services from someone other than one of their own departmental lawyers.
MR. FUREY: Most often, legal services are provided from within the Department of Justice. There would be times where they are not. The times where they are not would be when the department itself would not have that specific subject matter expertise. Most often, as I’ve said in the Legislature in previous discussions around Budget Estimates, legal services, and in other environments, part of my argument in advancing additional support for legal services is they are the legal firm, the law firm, for government - recognizing there are times that government does go external to secure that specific expertise.
MS. MACFARLANE: Over the last fiscal year, I understand that perhaps you had to have specific skills that Jack Graham has beyond your department. I’m just wondering, what skills were used from him as well as how much did he actually charge the department?
MR. FUREY: The need to go external sometimes, it is about subject matter expertise, and sometimes it’s also about timing and capacity from within. So, that answers one part of my colleague’s question. Specific to my colleague’s reference to Mr. Jack Graham, we have no expenditures paid out from the Department of Justice to Mr. Graham.
MS. MACFARLANE: Can I confirm with the minister, is this perhaps a Labour Relations question that I can ask later? My understanding is that there was an expense made and paid to Jack Graham, so I’m just wondering if that is in the Labour Relations part of . . .
MADAM CHAIRMAN: Oh, you’re referring to the latter part of his . . .
MS. MACFARLANE: Labour Relations, yes.
MR. FUREY: I know from speaking with the director for finance in the Department of Justice, that there’s no expenditure, no payment made from the Department of Justice. In the absence of my Labour Relations colleague, I’m not able to answer that question at this time, but we can certainly find out to determine if there was an expense billed to Labour Relations.
MADAM CHAIRMAN: They’ll be coming in later.
MS. MACFARLANE: I understand the province is in a legal battle with one of its former lawyers. I’m wondering, did Alex Cameron write the brief note at the centre of the controversy with no direction, no oversight, and perhaps avoiding any approval process?
MR. FUREY: I know my colleague has an interest in this particular area, but my colleague would also know that this matter is presently before the courts, and as the Attorney General, it would be inappropriate for me to comment on a matter that is presently before the court.
MS. MACFARLANE: I thank the minister for that answer and appreciate it. When the department lawyers draft a brief, or other court documents, what is the typical process in doing that? Are they given direction about the content or direction of the brief? Perhaps in the same answer, do they submit these documents through an approval process? At the end of the process, who has the final sign-off of these types of court documents?
MR. FUREY: This is a very sensitive area of discussion, because there is client-solicitor privilege extended to that internal process within the Legal Services branch.
Again, I am very cautious not to speak to any of those circumstances, for fear that it may impact existing litigation. I know my colleague may not like that answer, but I am just very cautious in this particular area.
MS. MACFARLANE: I am going to finish off and we’ll move to Labour Relations, giving time to perhaps have a break and have the minister’s other colleagues come in.
My colleague to the right will start off. I just want to thank the minister and his colleagues for their time in answering all my questions. I learned a lot, so thank you so much.
MADAM CHAIRMAN: We will now take a short recess.
[6:58 p.m. The committee recessed.]
[7:05 p.m. The committee reconvened.]
MADAM CHAIRMAN: Order, please. I call the Committee of the Whole on Supply back to order.
The honourable member for Northside-Westmount.
MR. EDDIE ORRELL: Thank you to the minister and his colleagues for taking a few Labour Relations questions more or less from our colleague from the Valley who couldn’t remain this evening. I’m going to start off with just a few issues that have popped up over the last number of years, but especially with the amalgamation of the health boards.
My biggest thing is there was talk when all the amalgamation happened about a number of different unions coming together to form fewer unions to allow better, fewer negotiations - hopefully better negotiations - and there were talks about legislating them back together. My first question is, how many unions did the health care system actually end up forming into, what is that number - from what to what?
MR. FUREY: If I understand my colleague’s question correctly, there were four labour groups, four unions in the previous environment, when there were nine health authorities. There are four labour groups, four unions in the present environment. In the previous environment, when there were nine district health authorities, there were 50 collective agreements, and with the present round of negotiations ongoing, when that is completed, there will be four in the Nova Scotia Health Authority, there will be four collective agreements in the IWK.
MR. ORRELL: You say when this round is completed - are you implying that a number of the collective agreements from the nine district health authorities still sit out there on - there are four unions now, but are there still collective agreements out there that are left over from the nine district health authorities, and if there are, what is the status of those collective agreements?
MR. FUREY: To my colleague’s question, yes, he’s correct. Those contracts, those collective agreements that were in place under the former district health authorities, although they have expired, the terms of those collective agreements remain in place until a new collective agreement is negotiated. That’s the process that is ongoing as we speak, and the objective when that round of negotiations is completed is that there will be four collective agreements within the Nova Scotia Health Authority. There will be four collective agreements within the IWK.
MR. ORRELL: How many of those collective agreements are still there, and what is the current status of those? If they expired already and we’re negotiating new contracts, what is the status of those current negotiations? Are they being negotiated now, the four unions that are in place? Are they in current negotiations? Are their contracts being negotiated now? What’s the status of that?
We’re hearing some talk about a strike vote and some other things starting to take place, because their collective agreements have expired. How long have they been expired, and what is the status of those collective agreements?
MR. FUREY: The 50 collective agreements would have expired October 31, 2014. The terms of those collective agreements remain in place, so none of that changes until such time as a new collective agreement is negotiated. As we speak, the health care element is presently in negotiations, and the Nova Scotia Nurses’ Union, who will negotiate on behalf of nurses, are looking to set dates to start their negotiations.
MR. ORRELL: So, there are no collective agreements negotiated within the new health care system yet - it’s all stuff that’s left over and continuing on. If that’s the case, what’s stopping the negotiations from moving forward?
I know there’s supposed to be a contingency plan in place if there’s a strike called, and there’s been talk of that, but are the negotiations close? Are we looking at getting our loved ones prepared for this, or getting our hospital system prepared for this, or our workers prepared for this? If they’re not close and we get a contingency plan in place, we could be facing a real disaster - more than we’re facing right now with the lack of doctors and lack of services.
MR. FUREY: I appreciate the question from my colleague. My colleague is correct in the conclusion he has drawn, but when we speak about the existing and ongoing negotiations, this is complex. It’s the first time that the Nova Scotia Council of Health Care Unions structure has been used, and we’re talking about 50 collective agreements being rolled into eight - four in each of the Health Authority and the IWK. I do want to say to my colleague that there is no strike imminent.
I responded to a question from my colleague, the member for Cape Breton Centre, but there is no strike imminent. The decision to call a strike vote is the next step in the process, whether we agree or disagree, and often used as pressure on the parties involved to step up their efforts in finding a solution.
I would say as well - my colleague referenced it very briefly - it is around essential services, and until such time as essential services are identified and agreed to, there is no opportunity for a labour disruption in the form of a strike. So, just some clarity to the process, and what elements exist in it, and then we can expand on that discussion, because I’m sure my colleague will have additional questions.
MR. ORRELL: Saying that, who must agree to the contingency plan? Is it government? Is it the health care system? Is it the unions? Is it all of the above? Realistically, will that ever happen? The health care system is not going to say that’s a good plan, the union is going to say it’s a great plan, and the government is going to go with not having the possibility of that happening.
Who has to agree to that, and what minimal standards will have to be met in order to say that there is a contingency plan that will work in place to prevent any disruption?
MR. FUREY: That’s a two-part question. I’m using the language “essential services” - my colleague is using the language “contingency plan.” I believe my colleague is talking about the same thing. I think for the benefit - the definition of essential services is laid out in the essential services legislation. I’m wondering if I can have one of the Pages copy that and table a copy, and provide a copy to both my colleagues.
It would be the employer and the union that would establish and agree to what those essential services elements are. In the absence of that, they understand that there is no opportunity for labour disruption in the form of a strike.
If they can’t resolve an essential services agreement, then either or both can go to the Labour Board and request an intervenor. The Labour Board becomes involved, and supports and assists in trying to resolve that matter.
I think the latter part of the question around the essential services legislation basically is, what are those services that are deemed to be essential? The definition that my colleagues will get momentarily lays that out. Instead of consuming time reading that, I think for the benefit of my colleagues, I’ll leave that for their review.
MR. ORRELL: My understanding is that these contracts have been expired since 2014, I’m assuming. We’re going to be four or five years in before there’s a new contract negotiated, so I assume it’s going to mean retroactive pay or new increases that are going to be requested. It’s not going to continue, I would imagine, but has there been an amount of money booked in the budget, and what line item would that show, that may allow for some modest, minimal increase in pay? Believe it or not, people’s power bills have gone up, oil bills have gone up, gas prices are going through the roof, groceries are going up, and if we keep freezing workers where they’re at, we’re going to end up in a worse situation in health care than we are now.
MR. FUREY: To my colleague’s question, the Department of Finance and Treasury Board in these circumstances would have booked sufficient resources consistent with the wage pattern that has been identified both for this matter as well as others that are not yet settled, and that’s based on assumptions and a wage pattern that we, in these circumstances, know the numbers.
MR. ORRELL: I guess the obvious question, is there is a wage pattern determined? Negotiations won’t be negotiations, as we know from the past. It’s going to be - there’s an amount, you said, there’s an amount put aside already for that. It obviously won’t exceed that.
That’s disappointing to hear, because like I say, people have expenses that go up. If we do get a contract settled in the near future, will we have to go right back into immediate negotiations? They probably won’t settle the contract for any more than four years, and if it’s five years, the five years has expired. If that’s the case, will we just negotiate a contract if that’s going to get to where it’s negotiated reasonably?
MR. FUREY: I thank my colleague for the question. He spoke specifically about the wage pattern. I think it’s important to recognize that when there are settlements with large groups - nothing new to this government or this term, past governments have established the same benchmarks. When a matter is settled with a large labour group, that becomes the pattern. That’s not uncommon.
That pattern presently has been four years, but we’ve just seen a settlement for a six-year period, so to my colleague’s last question, there is the opportunity to extend up to six years. I would say that government would be open to longer settlements, but my colleague spoke about immediately going back into negotiations. If there’s a four-year agreement, we would be right back into negotiations. If there was a six-year agreement, we would be back into negotiations in the very near future.
Part of this undertaking has been to get out of that pattern because that’s where 50 collective agreements had us. We were - governments of all stripes - continuously in that cycle of negotiations around collective agreements, and my colleague would know it becomes very time-consuming.
In addition to the wages - because I don’t want it to focus solely on wages, there are multiple other issues that become part of those negotiations, it’s not just about wages - the other element that exists is the employer has the authority to bargain what is referred to as shared gains. If there is an opportunity through negotiations to find savings, a percentage of those savings can be re-invested in wages, so there are a number of other negotiating elements above and beyond a wage pattern.
MR. ORRELL: It sounds like everything is going to be back on the table, then: long service awards, health benefits, pension benefits, wage patterns, wage salary scales. That’s good to hear, I’m glad to hear that.
You talk about some six-year agreements and six-year negotiations that have recently been done. How many contracts have been settled with the province since you’ve become minister - or since the last election? What group would that be that settled for the six years, and was the wage pattern the same that has been offered - I shouldn’t say offered - that’s been legislated on the other health care workers?
MR. FUREY: If I understood my colleague correctly, he stated that long service awards were back on the table, and he was glad to hear that. If I heard him correctly, that’s not the case, that’s not what I said. Long Service Awards are not back on the table for negotiation. Long Service Awards were frozen by the Department of Finance and the Finance Minister in 2015, and that is the current mandate for employers. We know with the most recent circumstances that there is an opportunity for payout of those long service awards. I wanted to correct that for the record so there was no confusion.
The second part of my colleague’s question was around what settlements have been reached. I believe he asked since the last election, which was just a year ago. There have been four collective agreements settled: the civil service for the Nova Scotia Government Employees Union, for a period of six years; the Nova Scotia Government Employees Union, with what was the former Tri-County Regional School Board - this is just within the last couple of months; the Nova Scotia Government Employees Union, with what was then the Annapolis Valley Regional School Board; and CUPE just recently settled with Halifax Regional School Board - all of them for six years.
MR. ORRELL: I wasn’t implying that it was back on the table. You just said that there are a number of different ways to negotiate, so I was asking if that could be back on the table. I’m part of that. I fall under that category, and to say I was a little bit miffed or upset when they took that off the table, because back when I started work at the hospital, private clinics were - I won’t say stealing, but they were offering a higher wage package with less benefits.
The hospital offered me a wage package, but the long service award was one of the things that made me go to the hospital. I could have made more money in the long run, but at the end I would have had that, and that’s why I decided to go to the hospital. It was my choice, and a lot of people did the same thing, so when it was frozen or taken away, a lot of people were upset with that, me being one of them. That’s why I say that. That’s why I bring that up, because you can say what you want about what the current situation is, but when you look at the past and why things happen, that’s why some people did what they did. They got me at the hospital because I was looking for my future, not for what I could make immediately and have to pay it out. That’s why I brought that up.
I just have two quick questions left. Bill No. 148 - when it was put in place, has been challenged or will be challenged and is challenged in the courts - I wonder if you can give me an update on where that sits in the system. Is it halfway along, a quarter of the way along? What might the status be of that court challenge?
MR. FUREY: My colleague is asking specifically about timelines. There was a recent meeting with the case management judge and there has been an agreement that government would submit a draft of the record, so this is about the referenced question.
The courts will set another date to further those discussions, but we know this will carry on into 2019, for sure.
MADAM CHAIRMAN: The honourable member for Cape Breton Centre.
MS. TAMMY MARTIN: Thank you to the minister and his colleague for entertaining some questions. Rollie and I have sat on opposite sides of the table many times in the past.
A few things I’d just like to touch on before we start, or before I get into my questions. I’d like to clarify that the NSHA and the health care bargaining group are not in negotiations. To be clear, they’re in conciliation. The minister said that the wage pattern was established, but the wage pattern was not established or bargained. The wage pattern was legislated. Just so we are clear on these couple of points before we get started.
As Mr. King and I both know, there may have been 50 books, but there were not 50 rounds of collective agreements. There weren’t 50 rounds of collective bargaining, because each union bargained a deal, word-for-word, with different wage packages, that from our point of view, and the employer’s point of view, went along very well and without issue. In fact, the one and only time we ever resulted in a strike was for 45 minutes. I would say we had a pretty good record over the last number of years.
The agreement that we’re talking about with the Health Care Council of Unions, the IWK, and the NSHA is not just about a wage pattern being legislated. It’s about items that are being brought to the table to change the course of bargaining. It’s about proposing significant clawbacks to the agreement midway through. Does the minister think it’s appropriate to come to the table to impede employees’ health care plans and to enter into new proposals this far in the game?
MR. FUREY: I do want to correct myself in the terminology that I use. My colleague is quite right. I used the language “negotiation.” It is not a negotiation. It is, in fact, conciliation, and there are additional dates set for the months of April and May. My colleague is correct, so I do want to acknowledge that piece.
I just want to speak briefly around my colleague’s reference to taking away. There is no desire to take away. I have to be careful with the language and what I say, because I don’t want to interfere with those conciliations or impede or compromise the dialogue that is happening, but the objective is to find consistencies. I think the approach that I would advance is that there is no proposal to take away health care benefits.
I think one of the points that my colleague would be very familiar with is the area of sick time, and the two models that we are trying to find consistencies with - there is the short-term illness, often referred to as the STI, with one labour group, and there is the sick bank with another labour group. It is a matter of trying to find those consistencies in those existing benefits, and how we can advance the dialogue without anyone experiencing anything that would be referred to as “take away.”
Sensitive to the conciliation talks they’re talking about, trying to be forthright with my colleague, I’m reluctant to use the language “take away,” because the objective here is to find consistencies within those multiple expired collective agreements.
MS. MARTIN: By finding that consistency between the two unions, one group is going to suffer a loss. One group will lose at the end of the day, so the employer is coming to the table with clawbacks to their health care benefits.
I believe that bringing new proposals to a table midway through the process is only prolonging the process. At the end of the day, we come to the table with our proposals, and if we continued to add to it, we could just continue to bargain until the end of time.
I would ask if the minister agrees, because I look at this as bargaining in bad faith. When you come to the table to take away and continue to add new proposals, that could be a detriment to the members around the table. That, to me, is bargaining in bad faith.
MR. FUREY: This is where I’m very sensitive to ongoing conciliations. Some of the comments that my colleague has referenced are matters that are presently before conciliation, and it would be inappropriate for me to speak to those discussions.
My colleague’s suggestion that individuals are bargaining in bad faith - my colleague would know there is a process if there is an allegation of bargaining in bad faith, and that would be a matter of engaging the Labour Board. I know my colleague is aware of that, and for purposes of the record, I just need those listening to know that we don’t believe we’re bargaining in bad faith. We believe that the fact we’re still at the table, that there are still conciliation talks scheduled into the months of April and May, is indicative of attempts and efforts to continue this dialogue.
MS. MARTIN: I agree with the minister that there are processes in place when there is an allegation of bargaining in bad faith, but in my opinion, when you come to the table and present new proposals midway through, it is my assumption that you don’t come to the table seeking an agreement.
Moving on to the essential services agreement, the minister talked about the next steps, moving forward, moving the process along, which is what’s taking place. The Council of Health Care Unions has applied to the Labour Board to have the essential services agreement dealt with, because an agreement couldn’t be made at the table.
When this government legislated the essential services agreement, it affected over 35,000 employees in this province - 6,500 of which right now are seeking to finalize an essential services agreement. What role in this process does the Minister of Labour Relations have in this process?
MR. FUREY: I have no formal role in the essential services agreement process. I have a responsibility to be aware, because it could or would impact other negotiations, other discussions, that are happening where I do have a responsibility. There is an awareness element, but no formal role with essential services.
I just want to clarify for the benefit of the House, that the matter before the Labour Board, as we speak, is just the IWK - there is no other element. I think my colleague used the number 6,500 - I think that would be the collective number. That IWK number would be a smaller number.
MS. MARTIN: Thank you to the minister for that - I knew that, but I didn’t say that. What is the role of the minister with the entire process that is before us with the Health Care Council of Unions and bargaining with the NSHA?
MR. FUREY: The role that I have as Minister of Labour Relations is really an oversight role that has a number of other elements to it. There’s a coordination role in engaging the parties involved, recognizing that, for the most part, these are arm’s-length employers. The Nova Scotia Health Authority is an example, they’re provided a grant and they’re responsible for that environment, and there would be other examples.
I’m a point of contact, my office is a point of contact for both labour and employees, and I’ve participated in, and continue to participate in, multiple meetings with labour leaders. I see that to be an important part of my role, and to establish a line of communication that, it’s safe to say, may have been fractured and needed attention in order to build relationships, and quite frankly, to foster over time a stronger relationship recognizing - and these are the very discussions that I’ve had with labour leaders - there are areas that we will disagree but I believe, as do the labour leaders I’ve spoken with, there are matters and elements of interest where we can find common ground.
That’s part of my role, but I do want to share for the benefit of those involved, because this is a new portfolio - for lack of a better term - and I’ve come to realize in the very honest, frank, genuine discussions that I’ve had with our labour leaders and continue to have - this is my observation as an outsider looking in and I think that brings some value to the environment and the discussion.
There are great people in government and the employer role, and there are great people in labour who are doing their best to advance difficult discussions, but unfortunately, are caught up in a broken system. The whole Labour Relations element has been adversarial and confrontational, and when there’s resolution, there’s a period of reconciliation, if you could call it that. As we alluded to earlier, there’s been little time for reconciliation, because we’ve been back into collective agreement negotiations.
It has been my experience, in the discussions that I have had and the role that I fulfill, I’ve had the opportunity to engage some very dedicated, passionate people in both labour and government, and I say that by extension, the arm’s-length employers who genuinely want good outcomes. We’re challenged to get over some of those hurdles so we can get these things across the finish line.
When I meet with employers and I meet with labour leaders, I encourage them to think outside the box and some may think I’m naive in this approach, but I’ve been in some pretty confrontational situations, where your ability to communicate with those who differ from you, in my past circumstances, have saved me what could potentially be serious physical harm, in these circumstances, manage and mitigate some of the anxieties and stresses that I acknowledge exist when we’re at that point that we’re not reconciling those differences.
I know that’s a challenge for employers, the arm’s-length employers, I know it’s a challenge for some in government, and I know it’s a challenge for some in labour. My experience has been there are very good people who really want the best for those they represent. I’m optimistic. I’ve said to some of my labour leader colleagues that I genuinely believe we have the right people in the right place at the right time to find solutions. That’s the message that I continue to present in the discussions, that I continue to have with our labour groups.
MS. MARTIN: With all due respect to the minister, when you legislate a wage pattern that results in an actual wage rollback over the amount of time that it will be in process, when the employer walks away from the essential service bargaining agreement in the summer and doesn’t come back until early March, how does that restore faith in anyone in this bargaining process?
I agree with the minister that both sides need to work together. You can have your disagreements at the table and then come to the best deal you can for the betterment of everyone involved, but how can legislating collective agreements or legislating bills to take away the right to strike, to put in an essential services agreement and not come to the table for months on end to bargain it, and then the minister would expect that everything is fine?
I’m optimistic and I quite enjoy the bargaining process, but when free and fair collective bargaining is no longer that, how can anyone in Nova Scotia have faith that the process is going to work?
MR. FUREY: I know and I appreciate my colleague’s desire to speak with respect; I know she’s a passionate labour leader and labour representative.
I think it’s fair to say - and I think my colleague would agree with me in my statement but may not agree in principle - that there’s a bigger story, there’s more to the story than government negotiators walking away from the table or Health Authority negotiators walking away from the table, and the old saying, “It takes two to tango.” I say that constructively because there have to be items on the table for a discussion to have some progress, and one of those things - so, my colleague talks about legislating these elements in spite of those circumstances and labour leaders have said to me don’t agree with Bill No. 148 - put it aside; it’s going to be resolved; let’s focus on these areas.
I say that genuinely because I believe there is room in spite of those circumstances, whether we agree or disagree on those, that there is an opportunity to continue those discussions, and that’s the message I’ve communicated - maybe a little more aggressively in that environment than I am here today, but that’s the message that I have communicated to both the employer and labour leaders and, specifically, those who were at the table doing the negotiations. I really, I’ve encouraged them to think outside the box and work towards solutions. I remain optimistic.
MS. MARTIN: I have to say I do agree with the premise from the minister because I know that the health care workers that are being prepped for a strike vote don’t want to hit the street because they want to be in the job and they want to be in the hospitals and doing their work, but there is frustration.
Aside from putting Bill No. 148 aside and putting central service legislation aside, there has been labour unrest in this province for the first time in 100 years with the teachers. We saw teachers come out in the thousands like we never did before - I mean, the teachers were one of the most apathetic groups. Believe me, I’ve been at Province House lots and we’ve not seen teachers here in those numbers, but to have that relationship fractured, because I believe it is - I don’t believe that they can’t get a deal at the end of the day. You know, I will somewhat agree with the minister, but I believe that it’s starting off on the wrong foot, because as a CUPE colleague of mine used to say in bargaining, we go in with the Christmas wish book and we come out with a flyer, and if we can both agree with that flyer, then it’s a good day.
Finally, just a few more things on Bill No. 148 - can the minister provide us with the amount the government is saving by implementing Bill No. 148?
MR. FUREY: I don’t have the information that my colleague is looking for. It’s actually a matter from within the Department of Finance and Treasury Board, but what I will do, if my colleague is receptive is, we will work to find those details, to source those details from the Department of Finance and Treasury Board and provide my colleague with that information.
MS. MARTIN: I think it would be a little easier for many people to swallow if we knew the cost savings to the taxpayers at the end of the day, so I appreciate the minister’s answer.
Finally, when the process of the courts for Bill No. 148 is finished and it finds it has been unconstitutional, how does the government plan to deal with that, and have you put aside a set amount of money going forward, thinking that when it’s found to be unconstitutional there should be a pot of money - how many person hours it’s going to take to resolve, or is the minister or the department going to have to negotiate new collective agreements?
MR. FUREY: This is one of those points where my colleague and I will agree to disagree. I’m confident in the bill; I don’t believe there will be costs associated in these matters. To the point of my colleague’s question, there is no amount budgeted in the 2018-19 fiscal year for this particular matter that my colleague has referenced.
MS. MARTIN: Thank you to the minister for that answer. To that point, it is our right as Canadian citizens to participate in free and fair collective bargaining. I believe, as do all labour leaders, that Bill No. 148 will be found unconstitutional, but that is one of those things that we’ll just have to wait and see.
Having said that, labour is one of my loves, along with health care, and I truly appreciate your answers and your responses, and Mr. King as well. That is the end of my questions.
MADAM CHAIRMAN: The minister may give closing statements.
MR. FUREY: Thank you, Madam Chairman. I would like to take a very brief moment to acknowledge my colleagues in both the Official Opposition and the NDP for what I consider to be productive and constructive dialogue that I think is important in this Chamber. We should be able to have these discussions in advance, these concerns when they’re of concern, and not have to formalize it in the confines of this space, but be willing and free to share our respectful positions and efforts in the best interests of all Nova Scotians wherever we find ourselves engaged, and I know I have with my colleagues from both Opposition Parties in discussions over coffee and lunch, and in other areas where we find ourselves in common space.
This environment has been very interesting to say the least. I’ve listened attentively to multiple discussions that have taken place and, regardless of which political stripe that we represent, I can say that although some of us may get a little heated at times or maybe at times inappropriate, there is on the part of those who speak a genuine interest to express the concerns and the issues they hear that are presented by constituents. I simply want to say thank you to each of my colleagues, those I have engaged in Budget Estimates, as well as the caucus members for both Opposition Parties, as well as my colleagues in my caucus, for the attention and the passion that each of us demonstrate on behalf of our constituents.
MADAM CHAIRMAN: Shall Resolution E13 stand?
Resolution E13 stands.
Resolution E23 - Resolved, that a sum not exceeding $2,611,000 be granted to the Lieutenant Governor to defray expenses in respect of the Human Rights Commission, pursuant to the Estimate.
Resolution E27 - Resolved, that a sum not exceeding $354,000 be granted to the Lieutenant Governor to defray expenses in respect of the Nova Scotia Police Complaints Commissioner, pursuant to the Estimate.
Resolution E32 - Resolved, that a sum not exceeding $707,000 be granted to the Lieutenant Governor to defray expenses in respect of the Office of Information and Privacy Commissioner, pursuant to the Estimate.
Resolution E34 - Resolved, that a sum not exceeding $24,351,000 be granted to the Lieutenant Governor to defray expenses in respect of the Public Prosecution Service, pursuant to the Estimate.
MADAM CHAIRMAN: Shall the resolutions carry?
The resolutions are carried.
We will take a small recess while the ministries change.
[8:17 p.m. The committee recessed.]
[8:21 p.m. The committee reconvened.]
MADAM CHAIRMAN: Order. We will now turn to the Budget Estimates for the Department of Transportation and Infrastructure Renewal.
Resolution E39 - Resolved, that a sum not exceeding $477,545,000 be granted to the Lieutenant Governor to defray expenses in respect of the Department of Transportation and Infrastructure Renewal, pursuant to the Estimate.
MADAM CHAIRMAN: I will ask for the minister to give opening remarks and introduce his staff.
HON. LLOYD HINES: Thank you, Madam Chairman. I have Deputy Minister Paul LaFleche with me this evening, and Chief Engineer Peter Hackett.
Good evening, everybody. I am happy to be here to bring you a little bit of light relief after that riveting performance we just had there on very heavy justice issues. Now we are going to move into some interesting and provocative discussions, so thank you for the opportunity to talk about the work we do at the Department of Transportation and Infrastructure Renewal on behalf of all Nova Scotians.
We have the following staff: Executive Director of Finance and Strategic Planning Diane Saurette was here, and she will be coming later; and we have some folks in the gallery - waiting, sort of, in the wings, as it were.
The mandate of the Department of Transportation and Infrastructure Renewal is to ensure we deliver quality roadway and building infrastructure to support Nova Scotians and to ensure a thriving province. We will continue to work on twinning the identified 100- Series Highways, as well as undertake safety measures to improve the efficiency and safety of these roads.
Our mandate is also to focus on the QEII redevelopment - an exciting project - in order to provide Nova Scotians with access to the health care system they need in the location they need it. We will work to ensure the QEII facility and all other infrastructure projects under our department are delivered in a timely and fiscally responsible manner.
Finally, our mandate is to ensure we are leveraging all that we can for Nova Scotians to ensure we are fully maximizing Nova Scotia’s infrastructure potential as it relates to federal infrastructure programs. At the Department of Transportation and Infrastructure Renewal we want to deliver quality public infrastructure for Nova Scotians by providing a transportation network for the safe and efficient movement of people and goods, and by continuing to serve the building needs of government departments and agencies.
We manage the greatest share of the government’s capital budget that helps to pay for a substantial road and bridge network relative to the size of our province. We manage and maintain 23,000 kilometres of roads that span our four regional districts from Yarmouth to Amherst to the northern shores of Cape Breton. Our network also includes 4,300 bridges and nine subsidized provincial ferries.
Like my fellow MLAs and my fellow Nova Scotians, I know many of these roads well. Throughout my travels in Nova Scotia I have had the opportunity to see the service provided by TIR’s employees - from plowing and salting in the winter to filling potholes in the Spring; I see the results of their hard work during the summer and Fall construction seasons.
TIR’s more than 2,000 employees are committed to the delivery of safe roads that help keep people and the economy moving. Our department’s employees are also responsible to manage the delivery of provincial buildings such as schools and correction facilities, and to maintain public structures such as provincial museums - and this absolutely wonderful building that we are in this evening.
Our employees deliver major infrastructure projects such as the recently completed Halifax Convention Centre and the QEII redevelopment project, including a recently opened new operating room at the Hants Community Hospital in Windsor - that new operating room will double the number of procedures done at that facility each year.
In addition to highways and public works, we are responsible for policy development related to road safety. TIR is responsible for the Motor Vehicle Act and for the delivery of legislation and regulations that keep our motorists safe on our roads, including working towards replacing the Motor Vehicle Act with a new Traffic Safety Act. We do all this with an overall operating budget of $477.5 million in 2018-19.
The operating portion of our budget is used for day-to-day operations of the department such as snow and ice control, highway and bridge maintenance, field operations, fleet amortization, ferry operations, vehicle compliance, engineering and construction service, administration, professional services, employee benefits, RIM work, and smaller highway and building projects.
In 2017-18, we had nearly $60 million budgeted to handle our winter snow clearing. The 2018-19 five-year plan will see us invest $285 million in capital spending on highways, bridges and roads - $60 million more than last year. In all we have 180 projects in this year’s capital plan.
Transportation is critical to ensure safe and connected communities. That is why we are making the third largest investment in transportation infrastructure in our province’s history - the third largest investment. Major constructions on new highways and bridges account for $50 million of the increase, with much of that additional funding focused on twinning portions of Highway Nos. 101, 103, and 104.
I want to take this moment to express my confidence in our department’s overall budget and its ability to support major initiatives, including the five-year highway improvement plan, ongoing road maintenance, and managing major infrastructure projects.
I want to take the opportunity to talk in a little bit more detail about some of the things that are real priorities for us in this fiscal year. Highway twinning, you’ve been hearing about it, is well under way. Last year we announced an investment of an additional $390 million over seven years to twin our 100-Series Highways, bringing the total to $815 million over seven years. The additional $390 million will allow the province to add three sections of twinned, 100-Series Highways to the existing highway plan and to build the Burnside Connector.
The four projects are: Highway No. 101, from Three Mile Plains to Falmouth, including the Windsor Causeway, totalling 9.5 kilometres and the brush removal has been completed for that particular job; Highway No. 103 from Tantallon to Hubbards, totalling 22 kilometres and the brush removal project there is nearing completion, it is probably 75 per cent complete; Highway No. 104 from Sutherlands River to Antigonish, including Barneys River, totalling 38 kilometres, moving along nicely; and construction of the four-lane divided Burnside Connector, that’s Highway No. 107, between Burnside and Bedford, totalling 8.7 kilometres.
As I said, clearing contracts have been awarded for Highway Nos. 103 and 101, and we expect construction work to begin on Highway No. 103 and Highway No. 101 in 2018-19. We are in the planning and design stages of the Highway No. 104 project and will have a better sense of construction deadlines by the Fall of 2014.
As for the Burnside Connector, both engineering and design are being worked on for this project. The biggest outstanding items are working to acquire some DND land that has some unexploded ordinance issues and environment assessment approval for the project. We would anticipate that work would hopefully begin in 2019-20, as shown on the five-year plan, depending on those outstanding issues.
Our funding also includes $30 million for safety improvements on un-twinned sections of highway. The provincial contribution will be used to access federal cost-shared infrastructure programs. To date the federal government has formally announced $65.6 million in funding for the twinning of Highway No. 103, and $34.5 million for the twinning of Highway No. 101.
Nova Scotia has submitted business cases to the federal government for consideration of other twinning projects and the province will continue to work with them to formalize agreements. News flash - roads are expensive. Each twinned kilometre costs $3 million to $5 million, depending on the complexity of the road - it isn’t cheap.
We have a great partnership with the Government of Canada. The significant expense of twinning and constructing new infrastructure points to the importance of working with our federal partners on the New Building Canada Fund and the Investing in Canada Infrastructure Program. We are pleased with the investments made to date with our federal partners and for NBCF funding.
I want to talk for a minute about our Gravel Road Capital Program, something that I know our department is very proud of. The news there is that we have an additional $10 million in this budget for the reconstruction of gravel roads that brings the total annual funding for this project to $20 million per year. Well-maintained, good quality roads are essential for rural communities. We have 8,400 kilometres of gravel roads in our province, and we need to have the ability to repair more of these roads than we have had in the past. The program is a proactive approach that will rebuild roads to improve the structure and drainage. This will result in longer lasting driving surfaces and make regular road maintenance easier.
That’s the message there, folks - this is about subgrade improvements, it’s about cross-culvert replacement on gravel roads that are more highly travelled, ditching, crowning and, finally, topping it off with some gravel which makes them much easier to maintain over time.
The funding, broken down on the number of kilometres of gravel roads in each district is: $5.8 million for the Western District, which is Kings, Annapolis, Digby, Yarmouth, Shelburne, Queens, and Lunenburg; $2 million for the Central District, which includes Halifax Regional Municipality and Hants County; $5.4 million for the Northern District which is Cumberland, Colchester, and Pictou; and $6.8 million for the Eastern District which includes Guysborough, Antigonish, Richmond, Inverness, and Victoria; and the Cape Breton Regional Municipality.
New schools - an important part of TIR’s responsibility is new school construction. There is approximately $200 million budgeted over the next seven years. The budget announced funding for new schools in Spryfield, Tatamagouche, Bridgetown, Bible Hill, Sheet Harbour, Eastern Passage, Dartmouth, Halifax, and Yarmouth. Three of these schools, Bridgetown, Bible Hill, and South Dartmouth have opened; the Tatamagouche P-12 school and Eastern Passage High School will open later this year. Yarmouth Elementary will open in 2019; Spryfield High School, the replacement for J.L. Ilsley, is currently in the site selection phase; and Sheet Harbour is scheduled to open in September 2019. Construction of South Peninsula Elementary School in Halifax, which replaces LeMarchant-St. Thomas Elementary School, was delayed while updated student enrolment projections were accessed, and construction of this school will begin this Spring, with opening schedule for 2019.
QEII redevelopment - the province is working closely with the Nova Scotia Health Authority on plans to modernize provincial health services that will improve health outcomes and provide quality care. The QEII redevelopment is one of our key departmental focuses. This project will allow services to be moved out of the Centennial and Victoria buildings on the Victoria General site of the QEII Health Sciences Centre, supporting their eventual closing.
Our department oversees all the construction, expansion, and renovations of this project. We are working closely with the NSHA and the medical community to ensure our infrastructure is built to best deliver health care services to Nova Scotians and Atlantic Canadians in a fiscally prudent manner.
The QEII redevelopment project is not your average construction project - it’s a huge project with a lot of moving parts. Since launching the project in the Spring of 2016, we’ve made a lot of progress, including the completion of a new operating room and upgrading and modernizing the existing operating room at the Hants Community Hospital; completion of the Dartmouth General Hospital’s third and fourth floors, with construction of its expansion and renovations well under way; renovation and construction of the Halifax Infirmary’s third and fifth floors; the purchase of land in Bayers Lake for the community out-patient centre; and the purchase of the CBC building for the Halifax Infirmary expansion. We will continue to communicate the progress and all updates to the QEII redevelopment project when we know them.
The Cobequid Pass - as you know, the province has indicated that we will be removing tolls to the Cobequid Pass for Nova Scotia motorists once the bonds are paid off - expected to be in 2019. A decision on commercial trucks and non-Nova Scotia residents will be made as we move closer to this date and have fully assessed the long-term maintenance and operating costs. We want to give Nova Scotia motorists a break. As we move closer to 2019, we’ll look at how we’ll maintain this crucial piece of infrastructure going forward.
Boat Harbour - government remains committed to the timeline set out in legislation to close the existing Boat Harbour effluent treatment facility by January 2020. It also remains committed to remediate Boat Harbour. We are well into detailed planning that will provide improved information about the extent of the contamination, cost-effective cleanup options available, design of the remediation, and total costs. To date, over $133 million has been set aside for the project. We are partnering and consulting with Pictou Landing First Nation, other levels of government, industry regulators, and academic researchers to make sure human health and the environment will be protected in all stages of this project - as a matter of fact, there is a public meeting in Boat Harbour this evening as part of the EA process.
In addition, TIR is working with Northern Pulp Nova Scotia Corporation on the requirements and design of a replacement effluent facility.
The Nova Scotia-Maine ferry service - I’m proud to say that we have accomplished what we set out to do in establishing a long-term relationship with a seasoned and reliable operator of the Nova Scotia-Maine ferry service. Despite some midsummer mechanical challenges, Bay Ferries exceeded last year’s total passenger sales. In 2017, the Nova-Scotia-to-Maine service carried 41,462 passengers, a 17 per cent increase over the previous season.
Tourism statistics indicate that ferry passengers are high-value visitors who stay longer and spend more. Between 2014 and 2016, visitors to Nova Scotia via the Yarmouth ferry have contributed an average of $17.5 million, each year, in tourism spending in Nova Scotia. As a matter of fact, in 2017, the Nova Scotia-Maine ferry contributed 15 per cent of the total U.S. visitors to Nova Scotia during the season of its operation - 15 per cent. That’s over 26,000 visitors. As I’ve said many times, we believe in this service. We support the residents of Yarmouth and southwestern Nova Scotia and the Nova Scotia hospitality industry as they capitalize on the opportunity that having this transportation link in place brings to the province. The Yarmouth ferry is a vital part of our transportation system, like the Trans-Canada Highway. We are working with Bay Ferries to ensure another successful season to build on last year’s growth.
With that, Madam Chairman, I’m ready to take questions.
MADAM CHAIRMAN: Thank you, minister. We will start our questions with the Progressive Conservative Party caucus.
The honourable member for Sydney River-Mira-Louisbourg.
HON. ALFIE MACLEOD: Thank you very much, Madam Chairman, and minister, I want to congratulate you on your opening remarks and I would like to add a few myself.
One of the things I would like to say is the two gentlemen who are on either side of you, I want to thank them for their willingness to sit down and meet with any member of any caucus to talk about challenges in our communities and our constituencies. I think it’s a sign of willingness to try to make things better for the province, and I do want to take a public opportunity to thank them for that.
I also want to mention the 2,000 employees you mentioned in your opening remarks because, again, they provide a service to this province. They do the best with what they have to offer and we may sometimes disagree on the amount of resources they have available to do the jobs that we believe need to be done, but at the same time they do a very good job with what you allocate to them to do their work. I think it’s important that people understand these people who work with the Department of Transportation and Infrastructure Renewal are very loyal and hard-working.
In my own particular area, my district manager, Gerard Jessome and three of the OSs I work with on a regular basis - Paul Whelan, Mike Boudreau, and Danny Laffin - are, again, people you can approach and work with. They try their best with the resources that they have. I think anybody in any type of situation has to be able to appreciate that. Sometimes they don’t get acknowledged as much as they should, so I like to take any opportunity that I can to do that.
There is a great deal that your department is responsible for and there are many issues around the province where people come to you on a regular basis. You yourself, minister, have been very approachable since you took the position - not always giving us what we want, but very approachable in the manner of how you do business. Again, we’re grateful for that because we know that you too are under constraints.
But there is a burning question - one that has been on my radar screen for a number of years now. I would feel as if I am not doing my job if I didn’t ask you - first I should thank you because last year we actually did see some progress on this particular road, but what we would like to see is a little bit more progress on this particular road, so you are going to be shocked when I ask you this question - could you give me any sense of where we might be going with further improvements to the New Boston Road? I would be ever so grateful.
MR. HINES: Madam Chairman, thank you to the member for the perennial question regarding the New Boston Road. I actually got very excited earlier this evening when I was reviewing my notes and I noticed that 5.9 kilometres of the new Broughton Road is being done, and I thought that was the New Boston Road and I thought, wow, the member will be so happy to see that, but I see it’s the new Broughton Road - I added the “new” - and it is getting 5.9 kilometres of gravel improvement. I guess I made a mistake - it wasn’t New Boston.
However, the New Boston Road is high in our recognition and we will undertake to see what plans we have in store for that particular section - a very important part of your lovely riding.
MR. MACLEOD: I do thank the minister for that. I guess it is a road in my constituency that a number of ministers are quite familiar with. Earlier in our session, the minister made a commitment and an agreement to come and visit some parts of the constituency, and I have to say that will be one of the roads that we will visit - so that you will have a true picture of what’s going on there.
You mentioned a number of areas that you and your department are responsible for and there are a number of questions that come out of that. One of the ones that’s a positive one for many of us in this Chamber who have rural roads is the gravel program. We’ve seen in the last couple of years some activity on that program, but there always seems to be a challenge. I’m not an engineer - and I know the gentleman beside you is - but it appears that the specifications for the type of gravel that we’re using on the gravel road program creates a number of issues. I’ve seen in at least a couple of areas where the department has had to go back in and rework and put fines into it because it appears - and again I’m not an engineer - that the specifications that are used don’t have enough fines for binding material in it, and what we end up with is getting a road that is gravelled and repaired. But it’s also like marbles, and when you’re driving on it, your ability to even maintain the speed that is not posted, but the 50 kph, becomes a challenge.
I’m wondering if there has been any thought given to looking at the specifications for the gravel that is used on these roads to make the roads safer because, as I say, there’s a lot of rolling that goes on and I know the intent of the program, of course, is to make roads safer. Again, not being an expert, I would ask that question because I sincerely believe it’s important that we try to rectify that.
MR. HINES: I guess to start with, in recent times, previous to this government, gravel repairs, for the most part, came out of the maintenance budget and that meant that capital improvements for gravel roads were not being done because the maintenance money, of course, is thin and has to be spread over great distances. We have now made a commitment in our second year - this will be a total of $30 million at the end of this budget year - going into redeveloping gravel roads.
In that process, we are learning a little bit more about gravel, ourselves. The department has undertaken a testing to identify a specification that will work better and, believe me, the matter that you bring up we hear that in various areas across the province. One of the things that we are going to be doing in this gravel road program, which we are hoping to continue for a number of years, will be learning more about gravel roads again because we haven’t been spending a lot of capital money on gravel roads.
The other thing about gravel is that it is really not all that expensive, but it is very expensive to move, and gravel is normally taken in the native area close by where the road repair is being made. That’s what we’ve been doing, using the availability that factors into the tenders that come out for these roads because the company that has the closest available source of gravel is able to be bid cheaper and they get the business.
Having said that, it kind of binds us to using gravel across the province that is close to where the activity is. On the other hand, we are looking at developing a common specification that will avoid some of those issues that you are talking about with regard to the lack of fines and the washboarding effect that sometimes happens with these processes.
I look forward to the department gaining, relearning more about the gravel process because, realistically, we haven’t been building gravel roads for quite a long time in the province.
MR. MACLEOD: Madam Speaker, I thank the minister for his answer, and I don’t think there is anybody who has rural roads, gravel roads, who would argue that we need the program. I, for one, anyway, am very appreciative of the program because I think that it is valuable and I think it is long overdue.
I also think, though, that we need to work very hard on the specifications and get it right because we have, in my constituency, done a road and then had to go in and do it again and add fines. My point is, that’s not cost effective and it’s not what the ultimate goal of the program is. Not to belabour the issue, it is very important that we know the type of specification we need - and it may be that it’s not a cookie-cutter specification. It may be, that when you’re in certain parts, one district, there’s a better type of gravel that might be there and it might be in that spec, but if we go at the lower end of the spec, instead of in the middle or a little higher, that might be the difference between marble effect or washboard, and doing a really good job.
I think we’re on the same page, Mr. Minister, but at the same time we’re grateful for the program but we need the program to do the road once instead of twice.
MR. HINES: Yes, I think we’re pretty agreeable about that process in terms of the specific geology that exists across the province and making that geology work in those areas, because we’re not going to take gravel from Money Point to Yarmouth. So, we need to work with the gravel in that particular area and develop an overall spec that would have the ability to meet the criteria that’s on the ground there. That’s exactly what we’re up to, and as I say, this is the second year of the project and an expanded year, because we’re doing a lot more kilometres in this particular year and we’ll be learning more about what we’re doing with that aggregate as we move the project forward.
MR. MACLEOD: I guess, the question that’s on some people’s minds is where indeed the funding has come for this program. There are some who would say that it maybe came out of the RIM funding, because that had been cut back over the last number of years and that creates another set of challenges when people are trying to do maintenance on the roads. As grateful as we are for the $30 million that you mentioned over the course of the last two seasons, the question is, is that new money or is it money that’s been replaced, that had been removed from other areas such as RIM in the past?
MR. HINES: First of all, the budget for the year ending 2016 was $215 million, and in 2017 we increased that amount by $10 million new money for the year ending 2017. In the current year, 2018, we’ve increased that by another $10 million, so now the total budget is expanded by $20 million of new capital into the capital program. It is new money and it is destined to be replenished each year into the future.
With regard to RIM, this budget that you have in front of you adds another million dollars to the RIM program, to take the program to $17 million. It had been $20 million and in 2010 it was cut to $15 million. Last year we increased it by a million dollars and this year we increased it by an additional million dollars. The actual RIM budget for this budget we’re talking about now has moved from $16 million to $17 million, and during this period of time with this government we’ve moved it from $15 million to $17 million, so it’s up another million dollars for this year, new money.
MR. MACLEOD: Again, appreciative of the fact that it’s up, but I guess the question would be, compared to five years ago, what amount was in the RIM budget to where we are today? There is, I believe, a difference, and I’m just wondering, would you like to expand on where we are from five, six years ago to today? Yes, it has gone up in the last couple of years and, again, I’m appreciative of that, but just from five, six years ago.
MR. HINES: Let me see now, five years ago was a momentous year, it was 2013 as I recall, a great year. The RIM budget was $15 million. It had been, prior to 2013, or six years ago when a different government was in place, it had been $15 million. It had been reduced from the time that the previous government to that was in place, which you might be familiar with, when it was at $20 million. It got reduced in 2015, we increased it by $1 million to $16 million - I think it was $15 million or $16 million - and now we’ve added another $1 million to it. In the last five years, since 2013, it has gone from $15 million to $17 million.
MR. MACLEOD: Madam Chairman, thank you to the minister for his answer. I guess the challenge is that although it is slowly being inched up, which again I think we are all grateful for, but the cost of doing business is also inching up. At the end of the day, even though you may have an extra $2 million in that budget, it probably doesn’t equate to $2 million worth of more work, because of wages, cost of asphalt, cost of equipment, cost of gravel, cost of culverts, and the cost of cutting branches and bushes along the road.
I’m just wondering if we’re actually making a gain, or were we just treading water at the same level but with extra dollars in the budget?
MR. HINES: Absolutely no doubt that we’re all victims of inflation. However, increasing the RIM budget by $2 million over the last three years I guess, is compensation for that process where you’re absolutely right, there are fluctuating costs associated with the budget. That creep, as it were, hits us hard on the maintenance side significantly because of the cost of living, the cost of doing business that’s in there.
I would also point out to the member that a new $2 million has been added to the budget on top of the $1 million for RIM this year, to accommodate a new brush-cutting campaign that we’re undertaking across the province which will be targeted at our 100-Series Highways, but it will deflect downward into our rural communities some of the money that was being spent on the brush-cutting on the 100-Series Highways.
We have a new $2 million program addition to the budget which will bring some of that money back down into the regions to aid with brush-cutting - although it’s not a direct contribution to RIM per se, it is an increase in the money that’s available for activities in the rural areas. I’m sure the member has had many complaints, as I have, about alders growing along the road. We’ve listened, we’re spending $2 million new dollars on this program this year, which will hopefully have a good effect for all the roads across the province.
MR. MACLEOD: I have a suggestion for the minister - this new $2 million program I think we should probably name it the Junior Theriault alder-cutting program. When the former member for Clare-Digby was here, that was one of his huge concerns, so I think it would be very fitting if that was to be named after Junior.
Again, I am not an engineer, but one of the great things I think that has happened over the last little while is the five-year plan, so we sit back and have a sense of what’s going to take place over the next number of years, which is good. Sometimes it has to change because of things that are beyond everybody’s control. I think most people appreciate that.
One of the things that we have talked about amongst ourselves, and I think I might have even brought it up in past times in Budget Estimates, is looking at a brush-cutting program to be done on a road that is scheduled to be re-constructed next year, to get that done this year. Again, not being an engineer, I believe that it would be very helpful to have the ability for that road to drain off more over the course of a season or two before work started on it. There are challenges we see sometimes when there’s a wet Spring. People go out and start their work, they’re trying to do ditching, and they’re trying to put in cross culverts, and there’s more settling.
I would be an advocate to do the ditching and the brush cutting the season before a road was going up on tender, and I look for an opinion on the ability to do that. Again, I know it can’t be done all the time, but with the five-year plan and some long-range planning, I think that would be a good allocation of funds and would also allow the road to maintain its integrity and its base for a longer period of time. I would be interested in feedback from you and your colleagues on that.
MR. HINES: That is a good suggestion and something that we would strive to do. What we end up with is the 100-Series Highways and the trunks and routes that we would be able to do that with. We would want to spend any money that was left over from the capital program. That would enable us to do that, which we do currently. That would be going to 100-Series Highways and trunks and routes because the plan is not published until the end of the year for the upcoming year.
Where possible, we are actually encouraging to get that work done on the trunks and routes in particular, to do exactly what you’re saying, to do any prep work that could be completed for an upcoming season if we have money left over. Of course, that’s the trick. You can appreciate, with a $285 million capital outlay, to get that money out the door - there’s 180 roads in the five-year plan. It’s a huge undertaking to get the money spent. Then of course, there’s the issue of spending more than we anticipated, which does happen occasionally. Sometimes, we do end up spending less, and that gives us a little bit of capacity to do the extras or the sort of thing that you’re talking about, but that’s certainly a good program to think about. It’s now more of an ad hoc arrangement than it is a true planned process because it’s dependent on what monies we might have in the program to move around.
MR. MACLEOD: Maybe I could suggest that we look at something like a pilot project where you pick two or three roads over the course of the next few construction seasons. It is a five-year plan after all, so if it’s a road that’s two or three years down on the plan’s list, it might be something that we could look at. At the end of the day, I think the goal is always the same regardless of who happens to be sitting in the minister’s chair, and that’s to make sure that we have safe roads that last for a long time.
As I said, I know I’m not an engineer, but I just think that sometimes we have to get a little outside the box and try something a little different to see if, indeed, it will improve the integrity of the road and, at the same time, see that our taxpayers’ dollars are going a little further. I respectfully ask that you consider that in your department. I appreciate the challenges of managing a $285 million budget with 23,000 kilometres of road to maintain. There is no doubt it’s a challenge.
In the opening statement that you made, you talked about a $30 million expenditure to making 100-Series Highways safer for the travelling public. Again, nobody would argue against that. The question is, what type of steps would be taken to make the roads safer? Is that $30 million budget over one construction year, or is it over a couple of construction years? What do you see as the type of improvements that will make the roads safer?
MR. HINES: Yes, we have added a $30 million budget, which is nominally over the seven-year period that we are doing the twinning. That is to target areas where we know we have a safety consideration. That would be intersections and passing lanes that could be added. It’s on non-twinned sections of the highway, so it’s not twinned sections of the highway. There’s ramp improvements where acceleration and deceleration is off, and we need to change that ramp a bit, expand it, run it longer to get to matching speeds.
One in particular that I would mention for the benefit of the member and all members who travel to the House from the Cape Breton area is a left turning lane. A left turning lane is being planned at the present time in the riding of the member for Victoria-The Lakes near Baddeck, just on the outskirts of Baddeck, where there is a significant commercial interest. It has been duly noted that it is very dangerous for people turning left there. There’s a tremendous draw to get people in there - it’s called coffee. We’re actually in the process (Interruption) I’m not advertising. But we noted that that one is particularly dangerous, and we’re currently in the process of planning this year for a left turn lane in that particular section. I’m not sure just what the estimate is on that project, but it is a significant improvement to the safety of that particular piece of un-twinned highway.
That’s what the $30 million is for. It will be expended based on safety considerations. That’s the first one that we have looked at that is being done this construction season.
MR. MACLEOD: The minister and I have the opportunity to drive from the Strait of Canso toward Halifax on a pretty regular basis. I have noticed in the last little while, as others have, a great deal of amount of work being done on guardrailing. I’m wondering if that’s part of this program, if it’s part of what’s going on.
The other question I would like to add to that comes from one of my colleagues, when it comes to safety considerations and travelling on dark highways at night, not just on the 100-Series Highways but other trunks and routes. That is lines on the highways. It’s one of the issues that I hear a lot of in my own constituency on roads where you have older drivers driving late at night when there are no street lights or whatever. You get a foggy night, and that little white line on the side of the road and the yellow line down the middle make such a big difference.
We have seen over the course of the last number of years that lines don’t last like they used to. I think it has something to do with the paint we use and being environmentally friendly. It might even have been our government that changed the type of paint being used. Just because our government decided on a change doesn’t make it right, Mr. Minister. The safety of the individual should be paramount over any of the issues that are caused by late-night travel.
I wonder if you could comment first on the guardrails that I have the pleasure of driving by and hopefully never having to use and second on the line painting and the safety considerations and factors of that. Again, that’s not just on 100-Series Highways but on a lot of the routes and trunks around Nova Scotia and rural Nova Scotia in particular. Knowing where you came from originally and where you live now, rural specifications are there, and I think the need is very great.
MR. HINES: The member is a keen observer, as he has noticed the amount of guardrail work that is going on, particularly on Highway No. 104 just outside of Antigonish. That leads exactly to the suggestion the member made previously. We did have some money left over in the 2017-18 budget which we’re employing to do the guardrail sections in advance of the paving that’s going to occur on that particular section of Highway No. 104. That is why you’re seeing more action on the guardrail. There was an opportunity to do on that 100-Series Highway the sort of thing you were talking about on gravel roads, which was to reduce the cost in the upcoming budget by deploying some funds there.
With regard to the paint, I can tell you that I’ll never feel bad about painting my house again because yesterday I signed a tender for $3 million for a portion of the paint budget for the department for the upcoming year. The painting process for lines and roads is an issue right across the country. The reason it’s an issue across the country is that we have had to abandon the lead paint that had been used. It was great for lighthouses and roads but not good for people and not good for the environment.
The industry has been moving away from that. I will say it’s struggling to find a formula in the paint that will last the way the old style of paint did. It’s strictly an environmental move that we need to make and are glad to do, from that perspective, because we all know the issues around lead.
The industry hasn’t found the right formula yet that will enable those lines to last. We’re spending a huge amount of money on this, as I mentioned, $3 million in one fell swoop. We know that that paint is not as lasting as the stuff we used to use years ago when we used paint with other formularies in it. That’s what’s happening with our paint situation.
I agree completely with the member that good markings on the road is a safety consideration and something that we try to do as best we can to make that paint spread as far as we can get it to go.
MR. MACLEOD: Just continuing on this issue, maybe there should be a line item in the Minister of Environment’s budget to allow for more painting on the highways, because I think that’s a major safety issue. It’s not one that we should take lightly, and I know nobody in this House does, but I do think it’s very important.
One of the things that ties into the line painting is, how many units do we have that are out there painting? I can tell you that whatever unit we send to Cape Breton Island, it also has a weather vane on it because as soon as it crosses the Causeway, it starts to rain. It puts delays on the painting of the lines because you can’t do that if the road is wet.
But on a very serious note, how many units do we as a government have that are painting lines? If we employ private contractors, which I believe we do, how many units in total would we see painting lines in the Province of Nova Scotia? Is there a particular season that is more optimum for doing that? Are they all employed during that season?
MR. HINES: That’s a great question. I would note that the $3 million figure that I quoted is simply for acquiring the paint. It doesn’t include the cost of applying the paint.
We have three government-owned and -operated units for deployment across the province, and we contract a fourth unit from a private contractor. In total, we have four units that we use to spread the $3 million worth of paint across the province.
MR. MACLEOD: Just out of curiosity, when we’re doing the work now on the 100-Series Highways, is there any consideration into putting reflectors down at the same time? They seem to stand up well, and they work well. If that was part of the contract for a contractor doing it, for the safety purposes of it, it might be a little cheaper. Again, I’m no expert. I’m just wondering if that is a consideration that the government and you and your department might be looking at.
MR. HINES: We actually have run a couple of pilots in the province - I believe on Highway No. 101 - for embedding some reflectors in the highway. We haven’t made a decision about making that a policy. We do put reflectors on the guardrails, which are also handy for that situation. We’re testing to see if the cost of doing that would provide the benefit that we would hope for from a safety perspective.
MR. MACLEOD: Just one more item on this. One of the things that seems to have some effect in a positive way is rumble strips, when we put the rumble strips on the centre line as well as on the sides. I’m just wondering if there is a defined policy on that in the department. I guess what I’m asking is, does it only happen on the 100-Series Highways? Or is there a policy for trying to see that that’s done on more roads? Again, because of the fact that the paint doesn’t last, the rumble strips at least give a driver an indication that they’re going afoul. I’m just wondering if there are any thoughts or policies that you have in place for future consideration.
MR. HINES: Yes, there is an articulated program for rumble strip application. They’re exclusive to 100-Series Highways. The issue on trunks and routes is that they tend to be more populated, and the strips are noisy.
They are effective. If you run over them, you’re soon going to wake up if you’re falling asleep. I guess that’s what they’re designed to do.
We include them in the capital program. When we’re doing a new section of road, they automatically go into the construction. We do have a pot of money set aside to do rumble strips in other areas to fill in the areas that are in between. We’re looking at doing the rumble strips on all the 100-Series Highways in the province but not the trunks and routes.
MR. MACLEOD: Minister, when you were giving your opening statement, you talked about the twinning program that we as a province are engaging in. It’s an ambitious one.
One of the stretches of highway, again, that has brought a lot of attention and interest has been between Sutherlands River and Antigonish. Chief Joe MacDonald has, on many occasions, brought up the issue and the concerns that he has as a first responder to accidents that he has seen on that road.
There was a report on CBC that talked about that 38-kilometre stretch, that there might be a possibility of looking at a P3 model to complete it. I’m wondering if you could share with the House what the vision of the P3 model is. As we all know, the Cobequid Pass was built on a P3 model, and the subject of tolls has come up in this House on more than one occasion. When the former minister did a group of meetings around the province, there was quite a bit of resistance to the idea of tolls. I’m wondering how a P3 partnership to make the road safer would benefit the province and also how that would affect the driving public and where that’s at.
That’s a large question I know, but if there is a way that you can try to give some enlightenment on it, I would be very appreciative, and I’m sure a lot of Nova Scotians would be very appreciative.
MR. HINES: We actually announced that we are considering a design-build- finance-operate-maintain option for that particular piece of Highway No. 104, the 38 kilometres between Antigonish and New Glasgow as it were. The reason for that is that we have a very expensive proposition before us to build that particular stretch of highway.
We know with great, provable certainty that twinned highways save lives. We know that because we have a particularly poignant before-and-after picture on the Cobequid Pass. The fatality rate per year dropped by over two fatalities per year during the 20 years of operation of that particular twinned highway.
Having said that, the quicker we can deliver this twinned-highway program - we’re shooting for 80 kilometres over seven years, very ambitious. We’ve also said that we’re doing it without tolling that portion of the highway. The quicker we can get this twinning in place, the more lives we will save.
In the instance of the Cobequid Pass, 45 kilometres of twinned highway were built up that section in 22 months - an incredible accomplishment 20 years ago. In comparison, the 15 kilometres of bypass around Antigonish took over eight years to construct and another five years to plan. The Cobequid Pass, at the time, cost $113 million, and the twinning for the 15 kilometres in the Antigonish bypass was $160 million. From that perspective - which was not DBFOM, the Antigonish stuff - from the perspective of time - and time on twinned highways saves lives - and the best value for money, both of those projects show a startling difference in what their costs were.
Given that and given that we are charged and trusted with the funds of the people of Nova Scotia, it is imperative and incumbent on us to try to find the best way to deploy those funds. In the instance of Highway No. 104, between New Glasgow and Antigonish, we’re in the vicinity of $300 million, so it’s very significant.
On the first analysis of the design-build-finance-operate-maintain model, there’s an indication that the saving could amount to around 14.5 per cent. You can do the math over $300 million. That is $42.5 million. There’s that consideration, there’s that saving, but there’s also that compelling argument that the quicker we do it, the quicker we will be saving the lives of Nova Scotians and all the attendant social and economic costs that that contains. At this point, we are exploring that. We haven’t finalized or made any decision on it, but we need to look at it to see if that represents a viable option for us.
In the mechanics of how it works, it’s that by employing one company or one firm, as it were, to do the entire project, you get unit cost reductions. I think there are 24 structures in that stretch. That means we get uniformity. When they go out to purchase those structures, they can buy them all the same. In Antigonish, I think we had three or four different companies building new structures that would have gone to different suppliers - they’d all look different, they’d employ different processes. We can get a unit cost on one builder across that process. Same thing goes for every other aspect of the build.
What it does is push the risk away from government and out to the entity that would have to absorb the risk of overruns and delays in the process, as opposed to government having to absorb those risks.
It has some apparent advantages on first blush, but as we sit here tonight, no final decision has been made on that particular process to execute that badly-needed piece of twinning.
MR. MACLEOD: I agree, on first blush in seems to be an option that should be explored, and the ways that it will save money. If you can save $40-some-odd million, then I can see the New Boston Road getting paved in the not-too-distant future.
On a very serious note, Mr. Minister, with a project like this and an expenditure of this nature, would there be safeguards to make sure that first, it was a Nova Scotia company that would be the one getting the work? One of the things we in rural Nova Scotia believe is that the Department of Transportation and Infrastructure Renewal is actually an economic driver in the communities for different companies and small businesses. There are different agreements, I understand, with tendering across Atlantic Canada, but I think it would be important that a Nova Scotia company be the lead in this.
The second part is, when a plan is put together, would the minister be open to the idea of taking that plan to the Auditor General and having him look at it and approve it, at least in principle, before we actually went down the road? We both know that he is eventually going to audit it, and it might be nice to include him at the front end of it, to get a sense of what might be potential financial falls that the engineering and construction side of it may not notice.
It’s a two-part question: a Nova Scotia company and an Auditor General working agreement to make it good for the people of Nova Scotia. Oh, part three - the New Boston Road.
MR. HINES: In terms of the local nature of the construction, last September I believe we did a market sounding to see if this ambitious twinning program that we have in the province was within the capacity of our existing roadbuilders in Nova Scotia to accommodate the project. We got a resounding “bring it on” from those guys.
I would point out that your question has some relevance because a Nova Scotia company built the twinned highways in New Brunswick and is operating those roads on a DBFOM model. That model is used in Ontario, it is used in Saskatchewan for building roads, and of course in New Brunswick. I see that New Brunswick announced today another new section of Highway No. 11 for twinning in that province, so there’s no doubt that we feel the capacity to do these projects exists within our roadbuilding capability within the province.
Of course, we are looking for the best value for our money. We would hope that that best value - and intuitively, you would think that it would - would rest with people who are here, who are mobilized, who have the employees, who have the capacity, who know the roads, all that sort of thing, which would result in a local tender being successful.
But at the end of the day there’s no guarantee that that would be the case, and it would run counter to our wishes to get the best bang for the buck, as it were, for our scarce construction dollars. In that instance, we would expect and we’re confident that the builders we have in the province will end up building the sections of roads that are here.
If you think about it, for all these ambitious projects which are occurring simultaneously, it’s going to keep our roadbuilders very busy for the next number of years. If you look at our existing capital budget over the next seven years, and if it’s in that range of $250 million, then that’s approaching $2 billion plus another $800 million for the twinning program that we’re into. You can see that the expenditures for roads in the province for the next seven years are in the range of $3 billion.
We would expect that that capacity is in the ability of the roadbuilders we have in the province who will end up constructing these roads. They are very anxious to see the preliminary work being done and the tenders coming out. Highway Nos. 101 and 103 are trending fastest of the four projects, and we will probably be awarding tenders for those particular projects this year.
MR. MACLEOD: Again, minister, thank you for your answer. One of the things I think has to be taken into consideration when we are awarding tender contracts is that you may save a little on the front end because you get a cheaper price from out of province, but we must remember, as I said earlier, that a lot of people believe TIR is an economic driver. When it’s a Nova Scotia company that gets it, they buy their materials in Nova Scotia, they buy their fuel in Nova Scotia, they pay Nova Scotia taxes, their employees will go out and buy their groceries, they will buy their home improvements, and they will buy their vehicles. These are all factors that will improve the economy of the Province of Nova Scotia - something I’m sure I don’t have to tell you.
At the same token, if we don’t add this into our economy, then there are social costs that are incurred by the government because people aren’t working. There should be a little bonus if you are a Nova Scotia company. I, for one, would never be one to give you a hard time about looking after Nova Scotians.
I’m just going to change where I’m at for a little bit, because I’m not sure if I’m going to get another opportunity. It’s called - and you are familiar with it - the Mira Gut bridge. I know that there’s some engineering work going on. They’ve been in contact with different people in the community and the boat club, trying to get a sense of the height that is required, because the proposal has to be made to NAV CANADA about the height of the bridge and whatnot.
I am just wondering if you can give me - and in turn, the community - a snippet of an idea of when this engineering study might be finished and when you might have an idea of what the appropriate structure would be.
I know it is still in the preliminary stages, and I don’t want you to make a statement that will get either one of us in trouble, but at the same token, the community is very interested. I had someone yesterday call me and say, look, I’d like to buy a house down there in Mira Gut, but I’m not sure. I’m on the wrong side of the bridge to get to work, and if there’s not going to be a bridge, I may not buy the house there.
Those are the kinds of things that are going through people’s minds, so if you could, I would appreciate whatever answer you give to that.
MR. HINES: You’re right. You would have seen some engineer-type folks out there crawling around the structure. There is a consultant involved in terms of determining what the boat traffic is there, which will influence the style and design of the bridge. We are expecting to have that in front of me by the end of this month or mid-May, in terms of having that result back for what we are going to do there. It’s not the New Boston Road, but we are looking at it.
MADAM CHAIRMAN: Order. Time has elapsed for the Progressive Conservative Party caucus. We will turn it over to the New Democratic Party caucus.
The honourable member for Dartmouth North.
MS. SUSAN LEBLANC: Thank you, Madam Chairman. Thank you, minister, and thank you to my colleague for asking such good questions - and humorous questions, at times.
I want to echo my colleague’s comments that he made at the beginning in thanking the people who do such hard work, and oftentimes dangerous work, for the department and for the people of Nova Scotia - so thank you to all of the Transportation and Infrastructure Renewal employees.
I wanted to start by asking about the contract with Deloitte about the redevelopment of the QEII. I believe that consulting contract was announced in July, and I just want to get an update on that. Gary Porter from TIR said in July that they expected that work should be wrapped up by February or March and that there would be some reporting.
First of all, I’m wondering if you can let us know where we are with that, and what exactly has Deloitte been providing advice on in terms of the QEII redevelopment?
MR. HINES: Thank you for the kind words about the work that the department staff undertakes.
Deloitte has been advising the department around the possibilities of alternative procurement around the QEII redevelopment. As I’m sure you can appreciate, hospital construction is probably as complex as it gets in terms of meeting the specifications for a modern facility. Let me tell you, we are going to have one wonderful piece of medical infrastructure that will service not only Nova Scotia but all the region, as we are currently a regional medical centre.
However, with that comes a lot of cost and a lot of contemplation in terms of how that would work. Working with Deloitte and working with the Nova Scotia Health Authority and the Department of Health and Wellness is currently ongoing, in terms of developing the requirements and what the redevelopment will look like.
We were hoping that we would have something in the form of a solid recommendation from Deloitte at this time, but now we’re probably looking at the late May to early June period for having something tangible that we would be able to bounce off our financial models and figure out just where we’re at in terms of budgeting and cost.
Deloitte’s role in that process is to advise the department on the value-for-money opportunity that an alternative service procurement would result in.
MS. LEBLANC: Just to clarify, late May or early June, when you expect to hear back from them - is that when we would know, or Nova Scotians would expect to know, about a decision made? Or do you then have to take the report and figure things out from there? Basically, what I’m asking is, when will Nova Scotians get a clear picture of what the plan is for the HI site in particular?
Also, can you talk about a cost associated with that consultancy? In July, when it was announced, there was no cost associated with it - I guess because it wasn’t known how long it would take and what the work would entail. But by now I’m sure there must be some kind of interim report that you could base a Budget Estimate on, so I’d love to hear about that.
MR. HINES: On the timing, we are expecting that certainly this year, 2018, and probably by late summer or early Fall, we will have gone through the process. Government will have received the information from Deloitte, so we’ll be informed and we’ll be able to make a decision about what process we’re going to use for the construction and have some concept of what the cost would be. That’s the kind of scheduling we’re looking at.
We’re getting very close on this project. There’s a tremendous amount of planning that’s gone into it. We’re going to do some preliminary work there in advance of the overall project to get it moving, and that final decision, or something that we’ll be able to share publicly, we’re quite sure we would have by late summer or early Fall.
I’ve got people desperately looking through the books here to find the Deloitte cost, and we’re unsuccessful at getting that for you, but we’ll be able to get it sometime before I’m out of here.
MS. LEBLANC: I wanted to pick up on something my colleague was asking about in terms of the procurement process - and I say it like that because I have a hard time pronouncing that word - and that is about the tendering.
I take it from your answer that there is not necessarily a requirement that companies come from Nova Scotia, in terms of tendering. I’m wondering if that’s ever been a consideration of the government. I echo my colleague’s comments about, in terms of weighing - you talked in your preamble about doing things in the most financially- responsible way. I wonder about hiring local and using local companies, in terms of being most financially responsible. He makes a very good point about the spinoff effects for our economy and people being at work and therefore not taxing our social system in that way.
I’m wondering, in terms of when you rate or grade applications, is there any analysis done at that point, in terms of how that kind of economic spinoff can be incorporated into the idea of being financially responsible?
MR. HINES: On the procurement side, there are all kinds of issues around how that works, which are handled external to TIR through Internal Services, who are the procurement experts.
Let me just say that we are bound by existing interprovincial trade agreements and international trade agreements that control our ability to - perhaps “control” is not the right word - influence our ability to award the various contracts for these major jobs we are doing.
Just to use an example close to you - and me too. It serves my riding as the Dartmouth General, which is around $145 million. In that instance, on the third and fourth floors, PCL was the general contractor on that extension and that program, and on the extension, they are acting as agent for the department and we are tendering the various trades. The construction trades doing that are all Nova Scotia trades.
We would expect that whatever we do in other instances - we’re expecting that the QEII will be a larger number, but that process could be the same. It would employ Nova Scotians. I can tell you that I am very aware, when it comes to labour, of the importance of shopping local.
MS. LEBLANC: Thank you for that answer. I want to talk a little more about P3s. We’re going to run out of time, but I’ll just start this.
Generally, the sort of justifications we’re given for P3 arrangements are financial in nature. The argument is that the P3s cost less because the private sector fronts the capital, rather than the public sector. Is it the opinion of your department that P3s cost less because the public doesn’t have to fund the capital?
MR. HINES: I guess when - and probably it applies to the medical side too - the expediency that the design-build-finance-operate-maintain process would bring to highway construction would be similar in the medical environment, in that the quicker we can get improved facilities, the better we can serve people from a health perspective. There is that consideration, which really sort of outweighs the finance consideration, per se, because what the P3 model does is push off the risk for the government. It does provide expediency in the delivery of the particular process.
At the scale we are talking about for these projects, which in the instance of the one we were talking about before, on Highway No. 104, is $300 million alone - and it probably would be safe to say that the QEII process will exceed that amount to do the kinds of ambitious planning that we need to do on the HI site to replace the old Victoria General.
MS. LEBLANC: I get the concept that the faster something is built, the better, because - like in terms of Highway No. 104 or any twinned highway - the safety factor is obviously paramount. But what I don’t connect with is that somehow we are better able to make things happen faster when they’re contracted out in a P3 arrangement.
Are you saying, or are you worried, that a publicly-financed highway, in using the Highway No. 104 example, would not be completed on time? Why do you have those concerns, if that’s the case? Why are you concerned that a highway that is publicly-funded wouldn’t be completed on time? “Time” is used in a general sense there.
MADAM CHAIRMAN: Order. The time allotted for consideration of Supply today has elapsed.
The honourable Government House Leader.
HON. GEOFF MACLELLAN: Madam Chairman, I move that the committee do now rise and report progress and beg leave to sit again.
MADAM CHAIRMAN: The motion is carried.
The committee will now rise and report its business to the House.
[The committee adjourned at 10:00 p.m.]