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HALIFAX, THURSDAY, APRIL 24, 2003

SUBCOMMITTEE OF THE WHOLE HOUSE ON SUPPLY

1:55 P.M.

CHAIRMAN

Mr. David Hendsbee

MR. CHAIRMAN: Good afternoon, I would like to call the Subcommittee on Supply to order please. It's now Thursday, April 24, 2003. We are now on day number nine of the debate of the Nova Scotia Budget Estimates Fiscal Year 2003-2004. At the time of expiration on Tuesday, we were debating resolutions E11 and E13 with the Department of Natural Resources and Minister responsible for EMO. At the time of adjournment, there was still 55 minutes remaining in the NDP caucus' time for questioning. We will start off with the continuation of that. I think the minister had some information to supply to us that was asked for during the last questioning period. The time is now 1:55 p.m. Also for time in debate so far today, we have 32 hours and counting.

The honourable Minister of Natural Resources.

HON. TIMOTHY OLIVE: Thank you, Mr. Chairman and members of the committee. There were a number of issues raised on Tuesday to which we did not have the information available and I would just like to go down those issues and present the information to the committee. The first issue was the claim forms that state what's covered regarding flood damage relief as a result of the March 31st disaster. I am pleased to submit a copy of that to the committee.

I think it important at this point just to identify what some of the restrictions are for the purposes of clarification. Some of the restrictions in relation to the government policy are that for primary personal residences, assistance is limited to expenses required to restore the residence to a basic level of living. These may include foundation damage, damage to furnaces, water heaters, water pumps and related equipment.

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Also, assistance may be offered for loss of chattels required for the basic essential operation of households. Chattels can include loss of stores of basic foods, essential winter clothing in storage and other basic items. In addition, any requests for assistance from an individual or small business shall be subject to a deductible amount of $1,000. Applications for losses of less than $1,000 will not be accepted nor considered. Finally, as a high point in these restrictions, any assistance that may be provided by the province to an individual or small business will not exceed $50,000. As exhibit one, I would like to submit that to the committee.

Another issue, Mr. Chairman, was the stumpage rates on both hardwood and softwood. I will not go through the charts, I think the charts are self explanatory. I trust the members of committee, once they have a look at these, if they have any questions further to that, I will certainly try to answer them or get additional information.

On exhibit three, the reclamation sites, one honourable member wanted to know if we could provide a list of the sites identified as part of the Cape Breton Development Corporation and subject to return of the licence to the province. There are 132 sites listed. We as a department in agreement, basically, or in consultation with the Cape Breton Development Corporation have split them into four categories. Category one being approximately 21 sites that Devco, or Cape Breton Development Corporation, have and had initially upon the return of the licences, the surrender of the licences, indicated that they took responsibility for the reclamation issues. In category two there are approximately 59 sites that are in the process of negotiation with the Cape Breton Development Corporation. Category three and four are sites that have been returned to original owners, sold to members of the community, returned to the Cape Breton Regional Municipality, either way, the majority of the category three and four are not considered crucial to the ongoing discussions. I would table as exhibit three, the list requested by the member of the committee.

[2:00 p.m.]

Mr. Chairman, the department fuel costs, there was a question related to the fuel costs for vehicles, and during the discussion we had indicated that there's also aircraft fuel involved. I am pleased to submit as exhibit four, to the Chairman and the members of the committee, a breakdown of the vehicle fuel and oil costs and aircraft fuel. I would advise the committee that the vehicle fuel and oil costs were $443,561, the aircraft fuel costs were $139,677, for a total cost of $583,238. I submit that as exhibit four to the committee for review.

The other issue that we were requested to provide some additional information on was the aircraft usage, department allocation under the aircraft usage, the flight hours, I can provide and will provide to the committee. Under exhibit four, the following information for flight hours related to the cost to each department and, again, members of the committee can

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review the breakdown and if they have any further questions I'm sure we will be able to clarify anything that is not clear.

Under the Department of Agriculture and Fisheries, Mr. Chairman, the total costs are $990; under the Department of Natural Resources the total cost of flight hours is $492,620; under the Department of Education the total cost of flight hours is $5,160; under the Department of Environment and Labour the total costs are $12,640; under the Department of Health the total costs are $960; under the Department of Justice the total costs for flight hours is $11,790; under the Department of Transportation and Public Works it is $8,130; under the Department of Economic Development it's $2,100; under Emergency Measures Organization it is $11,550; Service Nova Scotia and Municipal Relations it is $1,050; Nova Scotia Business Inc. is $600; and the Department of Tourism and Culture is $1,740; for a total cost of flying of hours of the department's fleet of $549,330.

Mr. Chairman, I would want to clarify, in providing this information, it's one thing to provide the information and I could fully understand the desire of the members of the committee to get some detail on where these hours would be used, I think it's important to note that there have been examples given through the Department of Education of the need for school inspections by the deputy and others. I think it's appropriate that significant hours have been saved and costs to government have been saved by the Department of Education being able to inspect a number of schools on any given day and get back to Halifax and complete the work that has to be done as a result of those evaluations. Certainly, it maximizes the effective use and the productivity of those employees involved.

Under the Department of Natural Resources, the number, as I said, was $492,620 and it's important to note that that includes a number of areas, not the least of which would be support to the RCMP in their ongoing work. Support to search and rescue operations across the country, support to the federal government in its research through Natural Resources Canada and other branches including Fisheries and Oceans. In support of their programs, where they need aerial surveillance or access to sites in Nova Scotia under federal jurisdiction, we have the aircraft available. Our rates are certainly competitive to what they could do if they had to hire the same equipment from the private sector. While it's certainly not our intent to compete with the private sector, it's just a matter of courtesy, as they would do with us, we would provide the opportunity to use our equipment.

The Emergency Measures Organization obviously is a very important factor and, quite frankly, the fact that there has only been $11,555 spent there, I would say that that has been a very effective use by the EMO of our flight services. So, Mr. Chairman, I would like to submit that.

Mr. Chairman, we had an issue of illegal fishing and deer hunting statistics, the number of charges, warnings. I won't go down all of them by district office. I'm sure the members of the committee can do the breakdown themselves, but I would say that as far as

[Page 588]

the annual statistical report for the Enforcement Division, the number of reports is 3,617. Of those, it was found after an investigation that 237 were in fact unfounded. The number of persons charged in Nova Scotia is 441 under the various Acts and legislation related to the department. The total number of charges actually is higher than that, 542. We issued 1,249 warnings across the province and I provide that information to the chairman for the perusal of the committee.

Mr. Chairman, the question was asked regarding the parks' opening and closing dates. The information provided there is pretty well self-explanatory, and once this has been submitted to the chairman and the committee, we would be pleased to get into any more detail on the parks' opening and closing.

Mr. Chairman, we did have a request regarding the Pepsi Cola Canada beverages issue. There was a concern that we had in fact acquired coolers to put these things in, vending machines, I guess would be the proper term. The payments to the vendor represent the product cost only and includes soft drinks, juices and bottled water. One of the questions I think I did receive from one of the members of the committee was can you sell juices and bottled water? I think his understanding was that you couldn't, when in fact because of the desire to provide healthy products to the travelling public when visiting our sites, in fact, part of the agreement does include the option of us providing juices and bottled water in these machines, and the department assigns an average markup of about 43 per cent on all products sold, and all the profits from the sale are reinvested into the operation of the parks. The breakdown of the costs, I think it may be appropriate to advise the committee of that and the public in general. So, Mr. Chairman, we will submit that to the chairman and members of the committee under exhibit seven.

Under exhibit eight, the explanation of departmental expenditures, there was a particular question regarding an expenditure with the Department of Transportation and Public Works, a total of $955,022.68 for the edification of the committee, I would like to submit to you those numbers. The largest group would be the Shubenacadie administration building for the radio refitting. As the members may be aware, there was a refit of the radio system, a substantial upgrade to the system and its subsequent transfer to the Department of Transportation and Public Works. The total amount for that, of the $955,000 was, in fact, $110,358.68. Another major cost of course is the office rental at Founders Square, which is related to Transportation and Public Works, $128,749. So I would like to submit that as exhibit eight to the committee. Again, we will be pleased to answer any further questions related to that.

Mr. Chairman, we have the breakdown as requested for Founders Square and will be submitted as exhibit nine. The total square footage at Founders Square is $63,268, and the base rate is $10.82. I would be pleased, again, as exhibit nine, to submit that information to the committee.

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Mr. Chairman, the forest sustainability agreements, the listing of payments made in 2001-02, that was requested by a member of the committee, a very reasonable request, and I'm pleased to be able to submit that as exhibit 10 to the committee. The forest sustainability agreements are a vital part of the department's plan to ensure proper management of the forest industry across the province, the forest sustainability program. I would note for the purposes of the committee that the agreements resulted in a forecast in expenditures, for example, to StoraEnso, a $675,000 forecast with an expenditure of $476,932.44, which would be one of the largest, but certainly clearly shows the efforts of this company and the many others to continue the efforts related to silviculture and the overall sustainability of the forests in Nova Scotia. I would refer you also to J.D. Irving Limited, the forecast expenditure there was $450,000 and the actual expenditure was $387,816.

So, Mr. Chairman, and members of the committee, you can see that these companies are working very hard to maintain what is expected of them by both the government and I'm sure by members of the committee, and the general public in Nova Scotia. The Association for Sustainable Forestry, the 2002 expenditure is $639,838.84. I would also add that these agreements were signed with registered buyers in 2001-02 to cost-share silviculture on small private woodlots normally delivered by the private sector, and that's important. In addition, the Nova Scotia Department of Natural Resources entered into a contract with the Association for Sustainable Forestry to conduct supplementary silviculture on small private woodlots. That's the number that I provided, and that $639,000-plus is a significant effort towards ensuring sustainability of our forests and I submit that as exhibit 10.

Mr. Chairman, the forest sustainability, again, I won't go through. There's a report here for 2002 that lists the registry of buyers for the 2001 calendar year. I could go through it but I don't think the committee would want me to at this point. It's pretty clear. (Interruptions) Yes, yes, I would think the committee would be quite pleased to review this and if they have any questions I would be pleased to answer them if I can and, if not, we will get the answers. The final submission that was asked for was the park statistics for 2002, and I am pleased to provide that. Again, it is a rather complete and detailed document, and rather than take too much of the committee's time, I will submit that as the final exhibit, as requested on Tuesday.

Having submitted those, Mr. Chairman, I would be pleased now to respond to any questions from members of the committee.

MR. CHAIRMAN: Thank you, Mr. Minister. That's 15 exhibits in total, did I count correctly?

MR. OLIVE: Thirteen, Mr. Chairman.

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MR. CHAIRMAN: Thirteen, thank you. So the time is now 2:15 p.m. We will start with the continuation of questioning from the NDP caucus. You have about 55 minutes remaining of your last hour from the previous day. The time now begins at 2:15 p.m.

The honourable member for Hants East.

MR. JOHN MACDONELL: Thank you, Mr. Chairman, and thank you, Mr. Minister. I will be interested to look at some of that information. Just a couple of things really, and then I'm going to hand off to my colleague, the member for Dartmouth-Cole Harbour. You mentioned, in terms of forest sustainability, Stora, I guess, have kind of planned for $675,000 but the uptake on that hasn't been all of it yet, or all that amount. Irving, $450,000, which they've used $380,000-odd.

The other day you thought there was - I have registered buyers, 57 or 51?

[2:15 p.m.]

MR. OLIVE: In the report submitted, honourable member, the statistical returns, which is one of the documents being submitted and I will refer to that, they were received from 353 registered buyers. Data was estimated for 14 non-compliant buyers, for a total of 367 registered buyers in Nova Scotia. Of the 367, 293 were reported to be active in the 2001 calendar year.

MR. MACDONELL: It seemed to me that the 57 or 51, whatever that number was the other day, was above a certain level?

MR. OLIVE: That would be, Mr. Chairman, those mills that are above the 5,500 cubic - if they're over a certain number, there's only 57 that are over that, they have to submit a wood acquisition plan, just to clarify that. Sorry about that.

MR. MACDONELL: The point I'm going to try to make, those dollars that you indicated from Stora and Irving, they would be out of the $3 million that the province puts into silviculture.

MR. OLIVE: Yes.

MR. MACDONELL: That's right. So, those two basically have booked over $1 million of the $3 million. So considering you might have 50-some who would submit forest acquisition plans, then there's an awful lot of individuals, I would think, who are not getting anything.

MR. OLIVE: Don't forget the 3 to 1 ratio, that's what you have to remember. You're using a $3 million figure but, in fact, it's a $9 million figure.

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MR. MACDONELL: Yes, but I'm talking about the money from the province. They're booking money from the province out of the $3 million, so if these other 50-some are going to book money from the province, there's going to be precious little. There's only $2 million left and we haven't even looked at Kimberly-Clark or any of these other companies.

MR. OLIVE: Yes, I just wanted to clarify something regarding your point. I gather from the question, and correct me if I'm wrong, your concern is that if it's a million of the $3 million, that that doesn't equate to the amount of silviculture that - you believe I left you with the impression that there was lots of silviculture being done - if that's the case, if that's all the money, if two firms are gobbling up $1 million then that might infer that there's not a lot of silviculture being done by anybody else. The point is, that while they're gobbling up $1 million, they're also spending $2 million of their own.

With all due respect, I don't believe that you can relate the expenditure portion of hours, or equate that to the amount of silviculture work being done by only using that one number. I believe you have to use the total 3 to 1 ratio, which would then clearly show that those two alone are doing $3 million worth of silviculture in the province. It's an important distinction and I'm not sure if that's where you were going.

MR. MACDONELL: It wasn't where I was going. I was looking at the provincial dollars that were available, but I need to move off that because my time is getting shorter than I realized.

The only other question I want to ask is around agreements. I know the deputy would tell me what the name of these agreements are, because it slips me right now, they're between the pulp mills and the sawmills on the exchange of chips for logs. Anyway, my concern comes around the notion that in some of these agreements where mills are to provide chips back to the pulp mill, in some cases when the market is down and they're not sawing as much but they still have an obligation to provide chips, that there are good saw logs being chipped. I wonder if that raises a concern for the department, that logs that should be kept for lumber are being chipped to meet the demand for an agreement with the pulp mills.

MR. OLIVE: No, that's not a concern. I guess the short answer to that is that we . . .

MR. MACDONELL: It doesn't bother you guys.

MR. OLIVE: No, we have ongoing discussions with the forest products industry of Nova Scotia and the pulp mills and I think we're working well in resolving - on occasion those issues do come up and because of the dialogue that we have with FPNS, we're comfortable that that's not an issue that's going to create some problems.

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MR. MACDONELL: Even if it happened on Crown land?

MR. OLIVE: It doesn't matter where it happens. I mean, it's not a major issue for us.

MR. MACDONELL: Thank you, I'm going to hand over to my colleague.

MR. CHAIRMAN: Thank you for the time. It is now 2:22 p.m.

The honourable member for Cole Harbour-Eastern Passage.

MR. KEVIN DEVEAUX: Thank you, Mr. Chairman. I want to ask a few questions about a couple of parks in my riding. I'll start with McNabs Island Park, which I assume is the name of the park, I think that's what it is, or Island Park. I'm trying to get some confirmation because, Mr. Minister, you know, we were at the annual general meeting of the Friends of McNabs Society a couple of weeks ago, and after you left they were trying to describe to me their understanding of the process by which the park will be opening and developed. It left me with a few questions, so I'm hoping you can clarify for the record.

My understanding is currently, right now, there is a management plan being developed by the advisory group for the park. That's correct, I believe, right?

MR. OLIVE: Yes.

MR. DEVEAUX: Okay. That management plan, there was a draft produced, they are looking at the responses to the draft and they are going to present to you at some time in the future a final submission for approval of a management plan, is that correct?

MR. OLIVE: That's correct.

MR. DEVEAUX: Do you have some idea of when exactly you expect to receive or approximately when you expect to receive the final recommendations?

MR. OLIVE: Let me say this, first. We were very surprised, and I would say pleasantly surprised by the amount of input that we received on that draft plan. It was very clear that there was a large number of individuals not only from your particular area of Eastern Passage, but people who had a very sincere interest in ensuring that that piece of very pristine and basically untouched land, that the process of moving it into provincial park status and establishing the rules and regulations in the operation of that park, that the department was well aware of what the desire of the community was. Because of that amount of input and substantial number of suggestions related to the draft plan we had hoped to have it probably early summer but, because of the scope and the information provided, I would anticipate that probably early Fall we would be ready to make public, again, for review, we

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will call it the final draft because there still will be discussion on the document prepared as a result of public input.

MR. DEVEAUX: So it's your understanding that there will be a final draft submitted by the advisory group to your office and then it will go out for further comment by the public prior to any approval by your office?

MR. OLIVE: Yes.

MR. DEVEAUX: Okay, that's interesting, thank you. So we're looking at probably early 2004 at the earliest before you would be considering approving a final management plan?

MR. OLIVE: It would depend, I guess, if we get the same kind of response as we did the first time around, that will certainly dictate the timing. I must tell you, honourable member, that it certainly would be my intention to try and move this along as soon as possible.

We are, of course, when we get that response back to this final draft, we will be looking at ways - let me put it this way, as I mentioned on Tuesday in response to another park question, we, as a government, and as a people, have to review the use of our park system. For example, we announced yesterday a partnership in the Wentworth Valley overnight park which will see, to all intents and purposes, a category three park, because right now we have our day parks and we have our overnight parks. What we have now is a desire by the private sector, and of course by us, in the parks, that quite frankly we can no longer sustain, financially, a desire by the private sector to pick up on that.

There are a lot of suggestions related to McNabs which may in fact be appropriately, or may be appropriately addressed by the private sector in partnership, by corporations in partnership, by community groups in partnership. I know you and I have had that discussion and we've had it with the Friends of McNabs. In fact, there are opportunities for the community in Eastern Passage to become involved in the day-to-day operation of that park and perhaps even find ways to generate some funds within the community that can be used to enhance the park.

This is new, this is completely new. The old way of looking at parks in Nova Scotia was, here's the park, a protected space is planned, here's what you can do, you can't do anything else in there, and don't try and don't ask. That was fine years ago, but the use of these parks is different. People use them as a starting point for cross-country skiing and for nature walks and many things that many years ago, while there was some of that, there certainly wasn't the volume of that and there wasn't the community interest in the local park. Many local parks, not McNabs, but many local parks in existence, especially day parks, were

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parks that were used by people travelling by them. That doesn't happen that much any more in many of these parks.

We have 99 day parks and we have an awful lot of them that the most things people see is the sign beside the road as they're going by, if in fact they go by, if they're not on a 100-Series Highway. So, getting back to your point with McNabs. When I say we'd like to have something back by the late Fall, that will entirely depend on the response to the document.

MR. DEVEAUX: Okay, you've led into my next question. I had always understood that your department was looking at partnership opportunities.

MR. OLIVE: Yes.

MR. DEVEAUX: Community groups, private sector, what have you. Is there a general policy within your department that those partnerships are sought based on a public tender or is it just done on a proposal submitted ad hoc? Is there a procedure you have in your department for that and, if so, how do you see that playing out in the case of McNabs Island?

MR. OLIVE: That's a very good question, I thank the member for the question because they will be done through a request for proposals.

MR. DEVEAUX: Which is a public process.

MR. OLIVE: Which is a public process through the public tenders office. That's what we did with the Wentworth Park project, we had two submissions, just for your interest. So, yes, absolutely. We'll use the example I think one of the Friends of McNabs mentioned to me that it would be nice if we could set up some sort of a concession where we could turn the monies back into park development, trail development, signage or whatever. If, in fact, that is accepted as one of the parameters in the development of McNabs, then that issue would then be developed into a request for proposals and the Friends of McNabs and anybody else that really wanted to provide it.

I must say, honourable member, that I'm not looking at going to people like CARA or Edwards Fine Foods or whoever is out there now, I don't even know who's out there, we're looking very specifically for organizations who will provide through the operation a direct benefit to the park, not as a money maker to take this money and spend it somewhere else. That would be included in any request for a proposal.

MR. DEVEAUX: Just so I'm clear, there'll be no public requests for proposals until the management plan is finalized?

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MR. OLIVE: That's correct.

MR. DEVEAUX: And signed off by you?

MR. OLIVE: That's correct.

MR. DEVEAUX: Okay. So, again, we're looking at after the Fall anyway.

I want to talk a bit about Garrison Pier on McNabs Island. Is your department putting money into Garrison Pier this year for renovations or additions?

[2:30 p.m.]

MR. OLIVE: (Interruptions) I thought we did, I just wanted to make sure I had the names of the partners. In partnership with DND, Parks Canada and Ducks Unlimited, as you know there have been repairs done to it, and the plan is to continue that arrangement this year to do some more upgrades to Garrison Pier.

MR. DEVEAUX: How much money will be spent this year by your department on Garrison Pier?

MR. OLIVE: Well, it's difficult to say at this point how much we've spent in our department because we're still in negotiating an agreement with Ducks Unlimited. Obviously, we'd like them to pay as much as we can get out of them, both federally through DND and through Ducks Unlimited. I don't have that exact number because, quite frankly, that's still being negotiated.

MR. DEVEAUX: Why Ducks Unlimited? Why are they involved specifically?

MR. OLIVE: Ducks Unlimited, like the Nature Conservancy of Canada and the Nova Scotia Trust, have a keen interest in any protected areas. As you know, along the beach at the south end of that island there are some habitat areas that are sensitive. Obviously that's one of the reasons. I do believe that kind of information was gathered both through Friends of McNabs and our own staff. So it's a natural progression for us to involve Ducks Unlimited. That's what they need to substantiate spending, so if we can take the opportunity to enhance the island through private-sector funding, that's what we do.

MR. DEVEAUX: Not a problem with the concept, just wondering why them. Does DND actually provide funding? They own the pier.

MR. OLIVE: They own the pier and they, as you know, have other property on the island.

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MR. DEVEAUX: Do they provide funding for the repairs or renovations to Garrison Pier?

MR. OLIVE: I'd have to get back to you on that. I can't specifically say they did. We know they do provide in-kind services, whether they also provided funding, I'm not sure. If you want the answer to that question, I can certainly find out if they, in fact, did fund it.

MR. DEVEAUX: Here's my point, I think most people will recognize, if you talk to them they know much about McNabs. I'm not much of a boater or anything like that, but even Wreck Cove, which is on the eastern side of the island is more sheltered, it's more easy for boats to access the island at that spot, the pier there, the Wreck Cove pier has basically been written off. It can't be used officially anymore. Also, for emergency purposes, as the island develops, Wreck Cove is literally a five minute boat ride to Eastern Passage, where Garrison Pier is much longer and, then, to Halifax, even longer. You know full well that the people in Eastern Passage would like to see the pier at Wreck Cove rebuilt. My question is, why are we putting money into improving Garrison Pier when some of that money could potentially be put into developing a second pier or even a floating dock or something at Wreck Cove to allow access from that point as well?

MR. OLIVE: Again, a very good question. I guess my first answer would be that we had to start somewhere to provide access to the island. The Garrison Pier was there, we could get some funding support which, of course, is key. So we moved on that initially.

Wreck Cove is recognized by park staff within our department as being a key access to the island, you're absolutely right. As you indicated earlier, we did attend the general meeting of the Friends of McNabs, and that is an issue, they have a concern that improved access is made available at Wreck Cove. I can tell the member that is actively under discussion as a capital expense through the TCA accounts. We obviously need to get our budget approved and then determine, quite frankly, whether or not we can get some support from other sources as well. It is one of the first priorities of the department in relation to the development of McNabs as a provincial park.

MR. DEVEAUX: Thank you. I appreciate that. If there's anything I can do from my perspective in helping, as you talk about partnerships, I'll be glad to talk to you about that afterwards.

Two other questions. McCormack's Beach Park which is in my riding, there is a boardwalk, it's a park that's seasonal according to your department, but it's one of those rare parks that's used all year, as you would know. There are many of your constituents who use that park, probably as many as . . .

MR. OLIVE: Absolutely. It's a great walking path.

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MR. DEVEAUX: That's right. There is no garbage collection, there's no maintenance of the park. Your deputy minister may recall, I may have raised this in previous years, is there any plan for your department to look at this as a year-round park in order to ensure that it remains accessible and well-maintained and so on?

MR. OLIVE: I think one of the advantages, one of many probably, to your community and to Nova Scotia in general is that with the designation of McNabs and Lawlor's, the McCormack's Beach area will, just by virtue of its location, be included in the development of a regular maintenance program for that community, as it relates to McNabs. I think we are obligated to do that, because whether we would like to have it as part of that park system or not, there is an understanding that it is. Specifically or especially if we get Wreck Cove opened up, there is a natural progress from that boardwalk to the trip to Wreck Cove to the park on the island. I take your comment, and we will ensure, as a department, that those concerns are raised regarding cleanup and maintenance.

MR. DEVEAUX: One last question, the trail system from Cole Harbour, the Salt Marsh Trail that's being extended into Eastern Passage, which is a good thing, part of the opportunity that opens up is it's a quick one or two kilometre extension of the trail down into Fisherman's Cove in Eastern Passage proper, which would allow for the ability to then access the trail, access the TransCanada Trail, does your department have a program or funding or any other resources available to try to allow community groups to access land that is currently privately owned, whether through helping them, assisting them with easement processes or anything else, that would allow that to happen?

MR. OLIVE: The issue of private land has been and continues to be a concern when we're talking about the overall development of walking trails, particularly. We rely 100 per cent on the community groups to put the plan together. If they run across old DNR lines or whatever, then of course, anything we can do to acquire the land, we do. At this point in time, we really don't have any authority to get access across private lands. What we have found, however, across the province, whether it's down in the Valley or down through Chester or wherever, there have been a number of occasions where the community groups, people who own those lands are involved in the community groups and we can get an agreement through the local trail committee.

We encourage that and support that, and if it's a matter of our department staff indicating to the landowner that we will do what we can in co-operation with the community group to ensure the protection of their land, when all they want is a trail through it, that there are not other issues related to the opening of that land, then we do that. It's not unlike government guarantees for business, if the government is on board, there's a comfort level there in dealing with the issue, sometimes. We take every opportunity, when we get into a situation like that and we have been in them, to participate in the discussions with the landowners, to say we're there. So that's what we try to do. Specifically, no, we don't . . .

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MR. DEVEAUX: You don't have a template for easement agreements or anything like that?

MR. OLIVE: No. It's difficult to do that, it's almost a one-off. You have to deal with them one-on-one.

MR. DEVEAUX: Those are my only questions.

MR. CHAIRMAN: Mr. Minister, you have an opportunity now for some closing remarks and comments. Your time is now 2:40 p.m.

MR. OLIVE: Mr. Chairman, I would like to thank the members of the committee for the opportunity to discuss our budget and some of the programs that are available. I would like to make a few closing remarks, however. First, I would like to thank my staff with the Financial Services Section of the Resources Corporate Services Unit for their time and effort in preparing the budget documents for the Department of Natural Resources and the Emergency Measures Organization.

The Department of Natural Resources is committed to building a better future for Nova Scotians through responsible natural resources management. We will carry out our responsibilities as they relate to development, management, conservation and protection of our forest, mineral, park and wildlife resources and the administration of provincial Crown lands. Our natural resources provide significant economic, social, cultural and environmental benefits to Nova Scotians. The department's aim is to maintain an appropriate balance so that resource use continues to provide a substantial contribution to the provincial economy, especially in our rural communities, while being carried out in a socially-responsible and sustainable manner.

Mr. Chairman, our natural resources are one of the province's features that make it an attractive place to live, to visit and to do business. Revenue generated from the resource sector, both directly and indirectly, help fund our health and education systems and other important public services. The department has identified several priorities for the coming year, which I would like to highlight here today.

We will continue to move forward with the province's forest strategy, which consists of nine policies, programs and regulatory elements. This year we will see the department complete the implementation phase of this strategy. Department staff will continue to support the mineral industry and other geoscience information users through our programs, services and information. Our integrated resource management planning for Crown lands will continue throughout the coming year. The integrated resource management process takes into account the relationship between the various resource uses and effects of management practices of one resource upon others. Staff are now working on the next stage of the

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integrated resource management process, long-range management frameworks for the 39 eco-districts identified in the province.

We will continue to provide an effective Parks and Recreation Program. Mr. Chairman, the department supports more than 120 camping and day-use parks, in addition to providing trail and other outdoor recreational opportunities on Crown land. Ensuring the conservation and sustainable use of wildlife populations, habitats and ecosystems in Nova Scotia is another priority for the department. We will do this through research, development and delivery of programs, policies and legislation, including species-at-risk initiatives.

Mr. Chairman, the department has a considerable amount of scientific and technical information available, and we will work to make it easier for people to access and use our information. This includes educational materials for our youth, educators, resource sector clients and the general public. The department is working with the federal government and other provinces on several initiatives relating to our forest and geoscience data. Nova Scotia will host the Mines and Energy Ministers Meeting in September, which will be an opportunity for us to showcase the province to our counterparts in other parts in Canada.

We will continue to protect Nova Scotia forests from fire, pests and disease. The extent of forest fires and insect occurrences vary from year to year, which can place a burden on the department's budget. We are looking at these programs to ensure that they address our requirements and still fall within our budgetary limitations. In 2003-04, the department will continue to look for opportunities to acquire properties to add to the Crown land base. Subject to the availability of tangible, capital asset funding, we will work to acquire properties that support department and government initiatives and programs.

[2:45 p.m.]

We will continue to work with non-government conservation organizations to leverage private sector funds for land acquisition. Information about our land base is important and DNR staff will be working to improve access to information in the coming year. We will work in conjunction with Service Nova Scotia and Municipal Relations through the Registry 2000 process.

Finally, in relation to the plan for this year, the maintenance and occasional replacement of the department's facilities and equipment are an ongoing priority. In the coming year, we have identified a number of project priorities, two department offices, park facilities, roads and equipment.

Mr. Chairman, I've had an opportunity since being placed in this portfolio to travel to other provinces and to meet with other Ministers of Natural Resources and Mines and I must say that I have been very impressed with the calibre of the staff that we have in our department and in their ability and their history in providing information - whether it's geo-

[Page 600]

science information, resource based mineral information, the mapping program, the integrated resource management program or on many of the other programs that many people in Nova Scotia probably would take for granted. I must say, I have had and continue to receive a number of very, very positive comments about the high quality of product that staff in the Department of Natural Resources produce and have produced over many years.

One only has to look at the mineral information that's been made available to the private sector that has seen such developments as the marble quarry in Cape Breton, which was as a direct result of research done by our minerals division. In co-operation with people in using the resources of the department in developing things like the Black Bull Mine in Yarmouth, the new gypsum mine in Nova Scotia and the fact that there is an increased interest in Nova Scotia in developing gold deposits, we have a very positive environment being created worldwide with the increase in the value of gold and that's having a very positive effect on the economic development potential for Nova Scotia in gold development.

As I mentioned earlier in my opening remarks, we have a substantial gypsum resource in Nova Scotia that provides great benefits and has for many, many years to the people of Hants County at the Milford quarry. We continue to ship literally thousands of tons of gypsum to markets on the Eastern seaboard. That fact alone is a clear indication of the economic advantages that we have in relation to our partners to the south as it relates to mineral development here and markets for the products as they're developed.

I would also say that in my ongoing responsibilities as Minister of Natural Resources, I have found belief and faith in the hard work of the Forest Products Association of Nova Scotia and all its members. It's tremendous that they have been able to continue the operations, to provide the forest industry in Nova Scotia with the opportunity to become a leader in Canada in growth and, in fact, surpassing the growth of the forest sector in Canada. That's quite an accomplishment, given the current dispute with the United States related to the softwood lumber issue and the anti-dumping issues.

In that relation, I would like to acknowledge the work of Diana Blenkhorn and the Maritime Lumber Bureau in support of the forest industry, not only in Nova Scotia but in Atlantic Canada. Diana has done a tremendous job with her staff in negotiating through the many issues related to the softwood lumber issue, providing a single, solid and united voice for the industry in Atlantic Canada which is so important to our success. We are very confident that with the continued support and direction of the Maritime Lumber Bureau that our forest industry and the economy of Nova Scotia as it relates to the forest industry will survive and continue to grow. We look forward to those ongoing negotiations and a successful resolution in the near future related to the softwood lumber issue.

Mr. Chairman, in closing, I would like to thank you and the members of the committee for the opportunity to present the estimates for the Department of Natural Resources and the Emergency Measures Organization. Prior to reading the resolution, I

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would be remiss if I did not mention again, as I did in my opening remarks, the excellent job of the staff - Mike Lester, Mike Mytte and the other support staff at the Emergency Measures Organization, Nova Scotia offices.

On March 31^st the province was faced with a major disaster, one that caught many people off-guard, but the people who were not caught off-guard were the staff of the EMO and their staff throughout the province in the regions were prepared, they were ready, they responded and credit should go to them. I would like to take this opportunity to ensure that the people of Nova Scotia and you, Mr. Chairman, and members of the committee have the opportunity to recognize the fine work and the fine preparatory work that these people have done to make it possible for us to be in a position, within a month of such a major disaster, to provide cheques to those that have thus far submitted claims for reimbursement. The cheques in that regard are going out this week and I think that would not have been possible without the fine work done by the staff, director and his staff, of EMO.

In addition to that, the association that they have through the Disaster Financial Assistance Program with the federal government, they've maintained those lines of communications and through their efforts in that regard, we are very confident that claims being submitted to the federal government will be processed due to the sincerity and hard work in providing the information and the quality of information being provided to the federal government by the staff of EMO. So, I would like to publicly thank them and take this opportunity to do so.

MR. CHAIRMAN: Shall Resolution E11 stand?

Resolution E11 stands.

Resolution E13 - Resolved, that a sum not exceeding $692,000 be granted to the Lieutenant Governor to defray expenses in respect of the Emergency Measures Organization of Nova Scotia, pursuant to the Estimate.

MR. CHAIRMAN: Shall Resolution E13 carry?

The resolution is carried.

Thank you very much, Mr. Minister. I would also like to applaud you in your expedient responses to the various questions that were asked by the caucuses on a previous day and returning information.

At this time I would like to call forward the next minister, the Honourable Peter Christie, the Minister of Service Nova Scotia and Municipal Relations. As there has been a change at the head table, I'll read into the record the resolution that is now before us for debate.

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Resolution E30 - Resolved, that a sum not exceeding $93,161,000 be granted to the Lieutenant Governor to defray expenses in respect to the Department of Service Nova Scotia and Municipal Relations, pursuant to the Estimate and the business plan of the Nova Scotia Municipal Finance Corporation be approved.

MR. CHAIRMAN: That is the resolution that is before us for debate at this present time. We'll have an opportunity for opening remarks from the minister. Mr. Minister, I ask that when you make opening remarks, make introductions of your senior staff that are present. As well, if there's any request for information or further information you must provide at a later time, please make sure you provide that information in triplicate - one for me as chairperson of the committee and the other ones to the Liberal caucus and the NDP caucus for those who have asked for the information, regardless which caucus has asked for the information, we share all the information that has been requested. Understood?

Your time is now 2:57 p.m. You have the opportunity for opening remarks.

The honourable Minister of Service Nova Scotia and Municipal Relations.

HON. PETER CHRISTIE: Mr. Chairman, I look forward to having the opportunity to discuss the estimates for Service Nova Scotia and Municipal Relations with the committee. As I begin, I would like to introduce the staff with me. On my left is Greg Keefe, the Acting Deputy Minister; on my right is Joyce McDonald with the Finance section. Seated behind me are Nathan Gorall, from Municipal Relations, Greg Sewell and David MacNeil. They've come to provide any additional information or provide the information that the committee might be seeking.

First, I'd like to tell you a few things about the department and touch on a few of the budget highlights. One item that warrants an explanation is the $2.4 million difference between our 2002-03 and the forecast. There are many gives and takes during the fiscal year, but there are two main factors why our department will likely exceed our budget estimate for last year.

First is the low income fuel assistance. This was unbudgeted a year ago and is likely to cost about $1.2 million. Second, we made the first payment of $2 million as part of our $32 million commitment to help clean up Halifax Harbour. Another line that should be explained is the distinction between the 2003-04 gross funded staff estimate and the provincially funded staff estimate. The first number, 933 refers to the total number of full-time equivalent positions in the department. Of these 933 FTEs, about 166 are funded by outside organizations. Virtually all of these 166 positions are in assessment service division which undertakes property assessment for the municipalities and is funded by the municipalities. The lower number, 772 refers to positions funded solely by the province.

[Page 603]

We have also made some internal staff transfers that this committee should be made aware of. Our Registry and Information Management Services has seen its budget increase for 2003-04 and the Program Management and Corporate Services have seen a corresponding decline. This is because 38 information technology positions have been moved from the program management section to our registry and information section.

Our department is an interesting mix. Virtually every Nova Scotian at some point in their lives has a direct contact with this department - from registering the births of their children to registering the ownership of their car to filing the deed to their home - all of these major milestones in their life involves contact with our staff.

We view our role of making these necessary transactions as easy and conveniently as possible. Our staff also play an important role in the development of communities. We foster strong municipalities with information and advice and with financial support. We also provide property assessment data to municipalities and to over 540,000 property owners every year. Municipalities use that assessment roll for levying property taxes which are the foundation of municipal finances. Through the Registry of Deeds, the department provides a vast array of geographic information and property registration services.

Like every government department, Service Nova Scotia and Municipal Relations has wrestled with significant challenges. Our costs were increasing yet we had to keep a control on spending. We are pleased to say that we have been able to meet this challenge without significant reductions to frontline service operations. After all, this is the core of our department. In fact, we are expanding service in rural Nova Scotia. We have just started offering Registry of Motor Vehicle services in Sheet Harbour one day a week. We will also be expanding the new land registration system into more counties this year.

[3:00 p.m.]

Just today I had an opportunity to meet with the Legion people. You will recall that we introduced the veterans' plates back five or six months ago. The Legion people were able to report to me that as of today, they have processed some 4,000 applications for people that are looking for veterans' plates. They are still very excited about the program and they are getting requests from all across Canada. Of those 4,000 that they've processed, only 3 have had problems that they've had to hold back. I think that indicates the success of the program, that indicates how this program is developing and it also gives us a strong indication of the support of the Legion in this area.

At this time, I'd like to go over some of the highlights of our business plan for this year. Part of our mandate is to help municipalities offer quality services to their residents. This would be as efficient and as effective as possible. We are encouraging municipalities to share and adopt each other's best practices. We are also leading an effort to expand the quality and number of "e" services available to municipal residents. This is an ongoing

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process with municipal officers that involve workshops and pilot projects on developed basic, intermediate and advanced e-mail services.

We are helping municipalities review their water systems as part of the provincial water strategy - $500,000 will be made available to municipalities to help them review their systems.

I'm also following up an initiative started by my predecessor to improve the relationship between the province and the Union of Nova Scotia Municipalities. While we have had a good working relationship with municipalities, the same cannot always be said between the provincial and the UNSM relationship. We all work for the same people so it is vital this relationship get back on track. I am pleased to report to the committee that I have met with the new president of the UNSM on several occasions. Indeed, we met early in January. I've had an opportunity to meet with their full executive, we've had an opportunity to meet on the guiding principles program that is between the province and the UNSM as to how we're going to relate. Indeed, five Cabinet ministers two weeks ago had an opportunity to meet with UNSM executive.

Mr. Chairman, our purpose and our goal is to open the line of communications and have discussions between the province and the UNSM. Indeed, in that way, through the municipalities so we can get the dialogue, so we can understand each other's problems and so we can try to solve some of the roadblocks that we have had or have perceived to have had along the way.

Another priority in our relationship with the municipalities is the issue of municipal taxation of waterfront properties. The tax bills for some of these properties have been increasing in parts of Nova Scotia. We are very concerned about the impact this has on individuals who hold property which has been handed down through generations. In an effort to resolve this taxation issue, last Fall my predecessor sent a discussion paper to the three municipalities that were most affected: Lunenburg, Victoria and the District of Chester. This discussion paper explored several possible solutions to the problems and we look forward to productive discussions with the municipalities. The municipalities, however, responded by saying they wanted us to work with the UNSM on this issue. This meant a solution is perhaps a little farther away, but we respect the municipalities' wishes and will work towards a resolution with the UNSM.

Earlier in my remarks, I mentioned that we planned to expand the land registration system. This system which made its debut in Colchester County just last month, will transform our 250-year-old paper-based property registry into a state-of-the-art electronic land registration system. This is a major undertaking in our department and, once fully implemented, will benefit property owners for many years to come.

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Another important part of our department is devoted to making our highways safer. This year will see a major improvement in our efforts to enforce commercial vehicle law and regulations. Service Nova Scotia and Municipal Relations has signed an agreement with the RCMP to share this responsibility. Because of this agreement, there will be more sets of eyes watching commercial carriers, resulting, we believe, in safer vehicles and safer highways.

Mr. Chairman, these are just a few of the many areas where Service Nova Scotia and Municipal Relations has been acting on behalf of Nova Scotians throughout the year. Every day the employees of this diverse department will go all out to help serve Nova Scotians. There are many fine civil servants and I am proud to be associated with them as their minister.

Mr. Chairman, I would also like to take a moment with you just to go over our business plan. I think most members of the committee will know that since its inception in the year 2000, Service Nova Scotia and Municipal Relations has made it easier for business and individuals to access provincial government services. During the past two years, we have introduced more service options, reduced red tape and cut our operating expenses. An independent survey conducted by the Institute of Public Administration of Canada in 2001 showed we meet or exceed service expectations when compared to other public and private sector organizations. We expect the Institute of Public Administration's follow-up survey, to be released later this year to be just as encouraging.

In addition to our personal service commitments, we are setting the pace in on-line service for across the provincial government. The number of licence and permit applications and renewals and the other public services available on-line is growing and gaining in popularity with our clients. This year will be a busy and challenging one for us. Despite financial constraints, we will maintain our existing programs and service options. However, plans to introduce newer services or expand existing services may take a little longer than we had originally hoped.

Some initiatives to watch for in the coming years are working with law enforcement and stakeholder groups to continue our efforts to reduce drunk driving occurrences, and making drivers and vehicles safer. We will release a supplement to the driver's handbook, designed to improve cyclist safety on our roads. As well, existing helmet regulations will be updated. This department will work to improve safety and competitiveness of the provincial trucking industry by aligning our legislation and regulations with national and international standards.

Service Nova Scotia and Municipal Relations will continue to provide leadership in on-line services. The Ask Joe Howe search engine will be expanded to include more provincial and public sector issues on the Web site. Web site visitors will also benefit from the new technology that lets them customize the information in any way they see as their needs. Departments will work with municipal councils across this province to strengthen

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these critical relationships. Mayors and wardens, councillors and municipal administrators can look to Service Nova Scotia and Municipal Relations for advice on a variety of topics, including land use planning, by-law development, on-line services and financial management.

We will continue the Municipal Indicators Program, giving local administrators and taxpayers information about the financial and social health of their community compared to others across the province. Work will also continue on amendments of the Municipal Elections Act in preparation for municipal elections in the Fall. Mr. Chairman, as you know, that has been introduced in the House, and that is progressing its way through the House at the present time.

Vital Statistics, along with its counterparts across Canada and around the world, will continue to strengthen its security options to reduce identity theft and to combat terrorism. Under the Land Registration Act, a new streamlined system of searching will be phased in, in the County of Colchester. Mr. Chairman, I do have some copies here that I will submit to the committee on that program for their edification, and perhaps committee members would like to have the opportunity to read through those at their leisure. It indicates our new program of land registration, one, I must say, has been vetted through a lot of people, and it has indeed gone through the Nova Scotia Bar Society.

These are some of the programs and some of the things that will affect people, such as the changes to the subdivision process and how it affects landowners, how this new system will benefit people and, indeed, how it will make searching records and cleaning things up much easier. I will submit those to the committee.

Mr. Chairman, almost every road and building in the province will be catalogued by March 2004 through the Civic Address Project. This will be a tremendous aid to Nova Scotia's emergency service and municipal planners. Service Nova Scotia and Municipal Relations is doing what we set out to do, to offer better services to the people we serve, and to reduce red tape.

Mr. Chairman, our mandate, when Service Nova Scotia and Municipal Relations was created in 2000, was a mandate to become the single-window service provider for government, non-social services, providing quality service delivery with convenient access, reduce the amount of red tape on business and individuals through process streamlining and to provide municipalities with a single-access point to the provincial government. This mandate requires the department to make extensive investment in technology and process re-engineering to ensure our system meets or exceeds government and client expectations. Many service areas in the department have made significant advances in streamlining process and efficiently improving customer service.

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Experience has proven that with careful planning, appropriate development time and the employment of technology, the department can simultaneously achieve more effective and efficient service results. Most of the investment to date has been attained through resource reallocation and internal efficiencies. This is consistent with the Auditor General of Nova Scotia, who indicated that government must improve its use of existing resources. While these options are now limited, the department will continue to explore these and other alternatives to support initiatives that promote the department's mandate and objectives.

Mr. Chairman, with those opening remarks, I will be pleased to answer any questions that the committee has.

MR. CHAIRMAN: The time now is for opening questions from the NDP caucus.

The honourable member for Halifax Chebucto. Your time is now 3:14 p.m.

MR. HOWARD EPSTEIN: Mr. Minister, thank you for your opening remarks. Most of the questions that I have will deal with the portion of your mandate that has to do with municipalities. I do, however, have a couple of questions that deal with other matters and perhaps I might start with them.

The first one is a fairly general one, and it has to do, really, with your judgment of how well the combination of services and municipalities is working out as a department. On the face of it, it's a very peculiar combination. It's hard to understand whether there's a consistent underlying idea that connects the two names of your department. On the one hand, you have a fairly large grab bag of licensing and administrative functions that seem to deal both with the public and, to a certain extent, with other government departments. Then you have this mandate to deal with municipalities and associated questions of land use planning. It's not obvious whether there's any intricate link between these two themes. I'm wondering, first, if you can help me understand whether there is a link that we should be aware of as we think about this department. In any event, how is it working? Does it make sense? Just looking towards the future, are you thinking about any other rearranging of the mandates, that is do you contemplate the possibility of any rearranging of the departmental responsibilities in the future?

[3:15 p.m.]

MR. CHRISTIE: That's a fairly general question, but let me start with my observation. As you know, I, like yourself, come from a background of municipal government. We've had an opportunity and, of course, our vision over the years was a department called Municipal Affairs that you got your loans from, that you got interpretations, where you submitted your by-laws, et cetera. As I came into the department, I viewed the combination as an interesting one. Now, indeed, I had been in another portfolio

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when this department was put together, but I think the thing I found over the period of time is that there is a very interesting link.

One of the things that has struck me over the period of the last three months is the array of services that's available through this combination of a variety of things to offer to municipalities. I cite, for example, the SAP Program, which is one of the government programs that we offer municipalities. We offer them training in that. I cite the e-mail process where people from municipalities that don't have the resources to get training in e-mail can come and get the training and can get assistance in developing their Web pages and so on. I cite the fact of the land information system. I cite the registry. I cite the fact that people can come, through municipal units, onto our land searches and use it for those varieties of reasons.

I am struck by the variety of options and things that are available to municipalities. Whether the Registry of Motor Vehicles and municipalities tie together the answer is probably no. However, what you're doing is you're building a big data warehouse, and that is essentially what it is. You have information on drivers, on accidents, on land, on assessments that municipalities and people can use. That's a long way to say I now much more appreciate the connection between those services and municipalities than I did when I went into the department some three or four months ago.

MR. EPSTEIN: So far you're saying it looks like a success. Just to remind you of one of the other points I raised, I wondered if you were contemplating any further evolution of departmental structures that involved what presently is Service Nova Scotia and Municipal Relations?

MR. CHRISTIE: With the projects that I cited in my opening remarks, such as the Land Registration and the Registry of Deeds and some of those, those are the projects that we have in our business plan, which are the ones that are coming. In terms of evolving, bringing more things into Service Nova Scotia or hiving things off, there is no plan to do that now. The development of those areas, the development of, for example, the call centres, now our business plan shows that we run call centres, but when the low income fuel came along, the call centre set up some additional people. I don't mean to suggest we will be static, but I'm suggesting to you that there won't be new concepts brought in and thrown into the mix that we don't presently see now.

MR. EPSTEIN: No plans for change, but you're not ruling it out either?

MR. CHRISTIE: I'm not ruling out the fact that we will be asked to tackle additional things through the data warehouse and through the call centres, but if you're suggesting, will we be starting to look at areas of Natural Resources, the answer is no. Basically the mandate that we have is to stay and provide those services, and to do it as efficiently as possible. I'm suggesting efficiencies not changes.

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MR. EPSTEIN: In fact, it's interesting that you mention Natural Resources, because one of the small details that I wanted to ask you about appears on Page 185 of the government business plan book for this fiscal year. In fact it does refer to support to programs offered by the departments, including Wildlife Act licensing programs on behalf of the Department of Natural Resources. It kind of sounds as if you already have some kind of linkage to Natural Resources. Since you brought it up I might ask what the heck that is? The one that really struck me was the words that followed after that, registrations on behalf of the Workers' Compensation Board. I have to say that was news to me, I didn't know that Service Nova Scotia and Municipal Relations did that. I wonder if we could just start with that one. Can you explain to me what that is?

MR. CHRISTIE: You will recall, and I'm speaking about the Workers' Compensation Board, some years ago there was a process to try to get business registration through a single window. This department is that window. So when you register for your GST, when you register for a business number, then workers' compensation ties to that. We do it because we are the window the people enter into to get the permits. It's that simple. We just provide numbers for people.

MR. EPSTEIN: Just to be clear, when a new company registers, as they would through Service Nova Scotia and Municipal Relations, under the former Registry of Joint Stock Companies, they are assigned a common number and that's for a variety of purposes, including, potentially, workers' compensation.

MR. CHRISTIE: And that number would have digits at the end, which would be the workers' compensation number, as it would have the GST number, et cetera and so on. It was part of that red tape reduction. So, any person sitting down could go in, and as opposed to having to fill out seven forms, you did this one form, and then it was shipped off to departments but it was . . .

MR. EPSTEIN: In fact, Mr. Minister, you might be interested to know this, that some time this past year I actually did register a new business entity, using the computers and the personnel in your department in that branch, and it worked very well. I have to say, indeed, they did this and they assigned a common number and gave all the information that was necessary for further business activities. It worked just fine.

MR. CHRISTIE: Now let me get back to the other part of your question, which was Natural Resources. There were two parts to that question. The Natural Resources part, you will recall that the Minister of Natural Resources announced the Piping Plover endangered species plate. Well our role in that is to develop the plates and to issue them. If Natural Resources determines a particular species is endangered, through Natural Resources and Service Nova Scotia and Municipal Relations, they work their way through that, develop a launch date, and then we are the people of last resort who issue it to you. That's the tie-in to Natural Resources.

[Page 610]

MR. EPSTEIN: Thank you very much, that's a big help. As I mentioned earlier, it really is more in the field of Municipal Relations that I would like to ask some questions. Those were really preliminary points for clarification.

I would like to start with your observations about the Union of Nova Scotia Municipalities. I'm not sure if I absolutely heard you correctly but, if I did, it sounded to me as if you were making something of a distinction between individual municipalities for which you seem to say your department had good relations and the UNSM with which you described the relations as being, occasionally, maybe a little bit scrappy. I don't remember your exact words, but that was certainly the impression you left.

MR. CHRISTIE: That was the impression I gave.

MR. EPSTEIN: I have to say, I find this only slightly puzzling, but I am wondering if you could amplify that a little bit. The reason I find it puzzling is because, of course, the UNSM is the chosen vehicle of the municipalities as their centralized voice, as I've followed the entity. You and I, of course, as you pointed out, have a common background in municipal politics. The UNSM has always acted as a body that tends to reflect the views of its member municipalities. My impression is that there's an effort made to discuss the issues and there are frequent meetings, and the municipal politicians who participate don't seem to be shy about speaking up at these meetings about what it is that's on their minds and working out their positions on this. I'm sure you know that UNSM has a number of priority items for this year, and that's the way it works. I'm not sure what the point of distinction was. Is there factionalism inside the UNSM that we should be aware of?

MR. CHRISTIE: Well, let me start by coming at that this way, one would assume - and when coming to this department I made the assumption that you just stated - that what the UNSM would say as their priorities are indeed what the municipalities will tell you are their first priorities. To my surprise, I found that was not the case. I've had the opportunity to chat, well let me say, with probably 20 to 25 councils and go visit them, and I have yet to go to a council and visit them and have them tell me their priorities are the ones that the UNSM have. For example, let me take business occupancy tax, which is one that has been on the UNSM discussion paper for awhile and, indeed, it's one of their top five, which they will give you and they tell me about. When I raised that, say with the Pictou County Council, when I raised that with Colchester County Council, that simply wasn't on their radar screen at all.

I think, as you debate with the UNSM, indeed, what they do is they tell you what the majority of their members say on a given issue. We, of course, deal with the municipalities directly, in terms of the equalization grants, we deal with them in terms of the water grant, so we have a relationship back and forth. Now there are certain times and certain processes that go through the UNSM. I mentioned the business occupancy tax. That one has been on

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the UNSM agenda, it's still on there. I have yet to have another municipality tell me that's one on their list.

What I suggest to the municipalities is we have two ways we have to work with them. And let me cite another example, let me cite the example of the infrastructure grant. The UNSM will tell you their position is that there should be a three-way split on infrastructure grants, that they opposed the federal government saying that we're going to bypass the provinces and go right to the municipalities, they opposed that. When you take that as a stated position, if you sit down with your old, former municipality, they will not buy into that process. They want to see an off-ramp there where they can make separate deals. That is what I'm referring to, when I say there are some distinctions between the stated UNSM policy and what a particular council might say to you and me if we were sitting with them today.

MR. EPSTEIN: You make interesting points. Are there any examples of priorities that you've heard from individual municipalities that we should be aware of, separate from the, sort of, top four that we hear from the UNSM in its regular pronouncements?

MR. CHRISTIE: Well, a lot of the policies in let's say, for example, East Hants, if you visit East Hants, their priority is to become identified as an urban centre as opposed to a rural centre, which will change the equalization process and the numbers. They will say to you they have certain areas they want developed as business parks and certain areas of signalization they want. They will also tell you they want to look at water systems that they have, complete and separate, away from what UNSM would tell you in this regard. If we were sitting down with the County of Colchester, they would say to you they have water systems they want to develop, they have some planning issues that they want to deal with, things that are quite apart and separate.

I think both you and I will recall, in those days when we worked in that field, there were those things that you could influence and those things that you couldn't. You attempted to deal with those things that you could and to reflect your views and try to influence those. So I view it in this way, the municipalities have their own individual issues that, through the department, you can work with them, and those issues which are bigger issues, that go through the UNSM, you work through the UNSM with those. That's sort of the distinction I make as I'm sitting with the municipalities. If it's something we can solve with them, without working all the way through the process, let's say only two or three people are interested in it, then perhaps we can find an easier way to achieve those objectives than having to work all the way through the UNSM. That's the distinction I make.

MR. EPSTEIN: Did you say you had managed so far to meet with about 20 municipal councils?

MR. CHRISTIE: Yes, I have.

[Page 612]

MR. EPSTEIN: That's very good. Will you continue to go through all 55?

[3:30 p.m.]

MR. CHRISTIE: That is my intention. Had the House not been called into session, I would have probably been able to say to you, 30. With the resumption of the House, as you know, you are not able to get out on the road. It is my intention, and I have made the commitment to get to them all. I have had a chance - down in the South Shore there were seven that came together, and we met all at once. The other ones, I have gone and visited them right in their chambers. I will continue to do that. My goal is to meet with them all and, as I indicated, to find those little annoyances that we can, perhaps, get rid of so it doesn't become a major issue with the UNSM.

MR. EPSTEIN: Very good idea, I would say. I would actually like to turn to some of the items that the UNSM does list as its priority items, and wonder if we could just go through a couple of those. The first one I wonder if we could talk about is the whole question of the taxation of the physical assets of Nova Scotia Power Inc. I am sure you know this issue in a huge amount of detail that's very familiar. The general argument that's been put by UNSM is that instead of the current formula for distribution according to an amount of electricity consumed in the community, the corporation ought to pay taxes according to where its physical assets are located. I am wondering if you could bring me up to speed as to the position of your government on this? Can you just let me know what position you've been taking?

MR. CHRISTIE: As you indicated, this is something that's been around. You certainly will be aware that a few years ago it was changed from being done on a revenue basis to a percentage of assets. That change was made and the UNSM position, along with those host communities of the assets, make the point that they should get full realization of the asset assessment against their tax rate. Over the last two years, well in the last four months, we have had several discussions, indeed, with the UNSM executive on that. Some of the municipalities are strong on it, and some are not. However, it is a policy statement of the UNSM that that's the direction we want to go.

I have indicated to them that it's our intent to keep moving in that direction; however, we, as a government, have a concern that fully releasing all of that would have an impact on the electricity rates to everybody across this province. Their position is that it's a private company, therefore, its assessment against taxes should be allowed. We make the point that, yes, it's a private company but it has the requirement to deliver electricity services all across this province. It's a little bit different than just the gas company and whether they choose to take oil there or not. So we make that point to them.

[Page 613]

We did, as you will be aware and as you have seen in the budget, increase Nova Scotia Power up again this year to $31 million, and we are now able to give those host municipalities more of that, so they're getting more. I guess my assessment would be we're moving in the direction but we're not where UNSM wants us to be fully.

MR. EPSTEIN: It certainly is a very good thing that the total dollar amount has been increased, I certainly think that's the right thing to have done. The question of moving to taxation by the municipality where the physical assets are located is, as you say, a tricky issue. I wonder if you've quantified what might be the impact on electricity rates for consumers if, in fact, that were implemented. If that's the chief barrier, what are we looking at?

MR. CHRISTIE: We have not done a detailed quantitative analysis. What we did do was compare where we were in terms of revenue drawback from this company as opposed to other companies across Canada, in other jurisdictions. We are now in the same range - Emera would be in the same range as other areas across Canada. The detailed analysis, and I will just check - anyway, what we have done, in consultation, and I think you will recall that last year, the power rates discussion with Nova Scotia Power, when they were making their application for an increase, they indicated that the tax draw last year was not the precipitating factor. They anticipated to move towards the $31 million. That was based on some of their studies of what the cost analysis would be.

MR. EPSTEIN: I'm not sure I really understand this point. The reason I wonder about it is surely the impact on the customers of Nova Scotia Power, the purchasers of electricity, will come according to the total number of dollars that they have to pay for all of their expenses, including taxation, of which property taxation is one part. How does it affect the total expenses of Nova Scotia Power and, therefore, potentially, the rate they charge their customers if a different arrangement is made for distribution of those dollars? Surely the only thing that would impact the electricity rates, even potentially, would be the total number of dollars not where those dollars go.

MR. CHRISTIE: Correct.

MR. EPSTEIN: I heard you say correct. Then what difference does it make if the individual municipalities are able to tax the physical assets rather than having the province set the amount?

MR. CHRISTIE: I take from your conversation that you're making the assumption that what we're drawing from Nova Scotia Power and the tax rate on the assets would be equivalent.

[Page 614]

MR. EPSTEIN: I wasn't making that assumption. That certainly seems the only logical point on which it could differ. You're saying that the total amount that the province now assesses against Nova Scotia Power is less than they would have to pay at prevailing market rates if they were turned over to the assessment division, for example.

MR. CHRISTIE: And that is correct. If the assessment in all the host municipalities was multiplied by their tax rate, it would be considerably more than $31 million.

MR. EPSTEIN: Do we know what the considerably more amount is?

MR. CHRISTIE: We will get that number. It's approximately $50 million, in the $46 million to $50 million range.

MR. EPSTEIN: An additional $50 million, on top of the $30 million.

MR. CHRISTIE: No (Interruptions) So the question is, what is the difference? It's about $20 million more.

MR. EPSTEIN: Okay, that's very helpful because I don't think I've actually heard that figure before. What this means, I guess, is that at the moment Nova Scotia Power's physical assets are assessed at less than prevailing market value, is that right?

MR. CHRISTIE: Yes.

MR. EPSTEIN: Is there a formula that leads to the amount that the province is using right now, the $31 million figure?

MR. CHRISTIE: The formula would essentially be the fact that, as I indicated, we do an analysis of power-generating companies across Canada. We have moved, for example, with this latest round, we are now approximately 1.3 per cent of net assets. That is a standard which seems to be set across the country. That is, if you're at the URB hearings and you're talking about power rates, they look at the percentage of assets that are coming to the taxes. If you look at that, comparable across Canada, we've moved now from slightly less to about the Canadian average, on Nova Scotia Power, of the 1.3 per cent of net assets.

MR. EPSTEIN: Do you happen to know, Mr. Minister, whether the system that's used here for the distribution of taxes from Nova Scotia Power is the same that's used in other provinces? To ask it another way, in other provinces . . .

MR. CHRISTIE: Since we have the same net asset ratio, are we doing an allocation between host municipalities the same way?

[Page 615]

MR. EPSTEIN: That's right, the question is, in other provinces do the individual municipalities get to keep the taxes themselves?

MR. CHRISTIE: I'm advised that there is quite a grab bag of systems across the country. Although the standard of getting towards the total dollar draw-down, the way it's been allocated to different municipalities is through private bills, some are on host municipalities, a number that way, but that's not a fully consistent thing across the whole country.

MR. EPSTEIN: That's been very helpful. Can you help me understand one other associated point about Nova Scotia Power's taxation? Apparently some $2.8 million of that $31 million is allocated towards the equalization fund, is that right?

MR. CHRISTIE: Yes. That $2.8 million stayed with the province, of the additional. I think your question is, of the $4.8 million, $1.8 million went to municipalities, where did the other $2.8 million go? That stayed with the province to be allocated towards the GST issue that was established, clearing up, as the equalization was done some years ago. You will recall last year the same structure. There were some monies through the process for the HST, we reinforced that again this year. Indeed, just to give you some numbers, for the sake of argument, of the $31 million we drew down this year, $9.9 million is for grants in lieu of taxes, municipal HST offset is $6 million, municipal equalization is $11.55 million, foundation grants is $1.55 million, and HST offset recovery is $2.5 million, which I was just referring to.

MR. EPSTEIN: Can we also look at assessment and taxation issues associated with other utilities? I'm interested, primarily at this point, with the natural gas facilities. Could you just tell me the current state of play with respect to taxation of the pipeline? I'm going to turn next to the facilities in Guysborough after that. But first about the pipeline, what's the current state of play in the dispute that had arisen earlier about that?

MR. CHRISTIE: Essentially where that stands now is that there is some agreement. Maritimes & Northeast has agreed not to appeal. I think it's the last three years. So the three back years, we've come to an agreement on that and they've agreed not to appeal. The current year, we are still working on. We would anticipate - the good side of that is that we will be able to release that to municipalities to start doing billings from last year's assessment. When this year's assessment is complete, they will get the additional or pick up the shortfall.

MR. EPSTEIN: Oh, that's interesting. Perhaps I misheard. Were you saying that for the pipelines, municipalities that have the natural gas pipeline going through are not sending the usual 50 per cent bill based on last year's assessment?

[Page 616]

MR. CHRISTIE: Yes. What I was suggesting was that they will be coming towards the conclusion of getting their final assessment position. They had been sending the bills, however, since there was the ability to appeal and have it recovered, they didn't feel they were in a position where they could fully spend that money. Although they were sending bills, they were reluctant and they didn't have the freedom of having the final resolution in hand.

MR. EPSTEIN: Yes, that's a very good point. So the years that have been settled, do they include the 2002 taxation year or not?

MR. CHRISTIE: The years 2001, 2002 and 2003 have been completed.

MR. EPSTEIN: So, in fact, there is a settlement now, is there, for assessment for 2003?

MR. CHRISTIE: The information that we have here is that the only one outstanding is the year 2000.

MR. EPSTEIN: You mean the partial construction time?

MR. CHRISTIE: Yes. That's the year that has been appealed, but those other years have been signed off, between the assessment and those others.

MR. EPSTEIN: Good. Thank you. That's very helpful. Now moving to the facilities in Guysborough County. Again, can you tell me the state of play with respect to municipal assessments for the facilities in Guysborough?

MR. CHRISTIE: I will just have my deputy get the sheet. Just before we get those numbers for you, as you know, over the last number of years, there have been bills introduced, there have been a couple of bills introduced, and in the last six months there have been a number of meetings between the SOE people and the assessment people. For example, the final position from the department to the manager, regular and commercial division for the SOE, our assessment, we had come to a point of $1.7 million. SOE's position is $99.6 million. We're very close, if you will recall, from where we started and how things have come together.

That has been submitted to their lawyers and to the manager of regular and commercial regulations for SOE, and we are waiting for them to respond. That was sent to them some four weeks ago, and we're waiting for their response. As I say, if you recall the issue when it started, you will, of course, realize that we weren't that close, the issue of the day was considerably further apart. As I indicated, right now the difference we're talking about is, our figure is $1.7 million and their figure is $99.6 million.

[Page 617]

[3:45 p.m.]

MR. EPSTEIN: One of those figures must be billions.

MR. CHRISTIE: I said $1.7 million and $99.6 million. For example, under what we're talking about here, the land and site improvements is $8.1 million, and the SOE's suggestion is $5.6 million.

MR. EPSTEIN: Okay, sorry, I wasn't following. I think I understand now. What year were these figures for?

MR. CHRISTIE: This is trying to come up with the figures of the assessment. Let me clarify some, these are for gas assessment plans that I'm talking about.

MR. EPSTEIN: Yes.

MR. CHRISTIE: That's the question you've been asking and those are the figures I'm giving you now.

MR. EPSTEIN: Have you any timetable in mind as to when you might be able to settle this?

MR. CHRISTIE: As I indicated, the department has had 11 meetings between September and January. I think both of us have shown a desire to try to get this completed. As I indicated, the resolve went to the lawyers and their commercial manager four weeks ago. It is our hope that they will be back to us shortly with a yes or a no, and we can complete these.

MR. EPSTEIN: I would like to move on to another item that the UNSM has raised as one of its priority items. I think this one has been around for some time. It has to do with the extent to which municipalities are called upon to make a contribution out of property tax to the cost of the Education portfolio. Again, this is an issue that we're all familiar with as of many years . . .

MR. CHRISTIE: Yes, it keeps on giving.

MR. EPSTEIN: It's a sore point for the municipalities, of course. The basis for that is that for the most part it's something for which municipalities are called upon to pay but have no authority over, they have no decision-making power with respect to school curriculum or hiring or anything to do with education except occasionally with respect to land-use planning for where schools go, as a function that they would be involved with, naturally enough. I'm wondering if, again, you could let me know the state of play. My

[Page 618]

understanding is that there has long been discussion about the possibility of a 10-year phase-out of municipal responsibility for funding. Are any talks actually being held on this point?

MR. CHRISTIE: I think there are a couple of things we should consider with that, and I don't disagree, the final position of the UNSM is that education should be fully funded by the province. In the discussions I've had with them, we've talked about a variety of things. Of course there is the end goal and then there are the steps that you go through to get there. Indeed, they recognize that the province isn't going to say, well, you guys are off the hook for all of the education money. However, the last arguments they have been advancing is that we freeze the level, and that the level be frozen at the current levels.

MR. EPSTEIN: That's at dollar levels, isn't it?

MR. CHRISTIE: That is correct.

MR. EPSTEIN: Their position is a dollar level not a percentage level.

MR. CHRISTIE: Their position is it be frozen at existing dollar levels, yes. Therefore, by definition, what they had in their budget last year would be what would be in their budget next year. They've had that discussion with us. Is there further discussion that they will have? Yes. We've indicated to them that through Service Nova Scotia and Municipal Relations, the Department of Education and the UNSM, we will put together people who will look at how we can achieve that. We have indicated to the president that we will undertake to do a review of that. We're sort of working away.

Indeed, one of the things that happened this year, you will recall, is that the rate was the same as last year, the rate that went out to people was the same as last year . . .

MR. EPSTEIN: On a percentage basis.

MR. CHRISTIE: No, the actual chargeable rate, the 36 cents (Interruptions) The mill rate, absolutely. Now, of course, the assessment went up in areas, so consequently their contribution went up. We had some discussion. Your question was, is there going to be discussion on it? Yes, on all of the options, the five major parties that the UNSM has talked to us about, we are proposing to have further discussions on. We don't have a time frame in mind. There's no, we have to achieve this by such and such date. But yes, we are planning to have further discussions with UNSM on that.

MR. EPSTEIN: Mr. Minister, you drew a distinction, which is an entirely appropriate distinction, between agreeing on a goal and then agreeing on the steps to reach the goal. What I'm wondering, though, is about the goal itself. Are you saying that the province is in agreement with this goal of removing the municipalities from the funding of Education?

[Page 619]

MR. CHRISTIE: What we're looking at is, the province is prepared to look at options and we're prepared to look at how that might happen. The other, of course, is you then sort of cloud the issue by saying let's get back into that roles and responsibilities area, and nobody wants to go back into that land mine. That seems to be everybody. As you start talking about that and you start saying, well, let's consider education options - the committee is there to look at the art of the possible. I will just give you another example, if, in the process of doing that, you were to make a decision you weren't going to have business occupancy tax, and let's say that occurred before provincial funding for education, the municipalities, their need to resolve those problems would become much greater, because now, all of a sudden they have to look at ways of reallocating and getting money because the business occupancy is gone.

A lot of these things depend on which comes first, the chicken or the egg. But what I'm saying to you today is that the committee will be looking at the art of the possible and how things can happen.

MR. EPSTEIN: Mr. Minister, are you saying you're prepared to take steps towards a goal, but you're not sure that you want to go to that goal?

MR. CHRISTIE: That's exactly what I'm saying. That's exactly what we're saying. We're looking at the options there, just what impacts they're going to have and how these things will roll out at the end of the day, I don't know. The UNSM has asked us to continue to work on this and we certainly will continue to work towards those things.

MR. EPSTEIN: That's a very interesting position. I have lots of sympathy for doing what's practical and achievable, but I also tend to think it helps if some goal is kept in mind. Perhaps I'm misunderstanding. Is there another goal the province has in mind?

MR. CHRISTIE: No, what we are - from the provincial side of things, and let me just say, when we had an opportunity, a group of ministers - the Ministers of Justice, Transportation and Public Works, Finance, Community Services, and myself - met with the executive, understanding that there were these five objectives, it was quite clear through the discussion. Yes, there are certain things, but in reality what we're talking about is a reallocation of where things come from.

Now we all identify there is one taxpayer. So, if you have that in mind, the fact is whether the municipalities pay this much and the province pays this much, what we need is to be able to deliver those services and find the method of how we bring those resources to the table. That was quite clear in the discussion we had with the ministers and the UNSM executive. The President of the UNSM said that was the first time in a long time they had a chance to sit down with five Cabinet people to look at what they want to do. What we need to do is open these discussions. At the end of the day, we may not all get what we had set out to do, but we need to keep working towards trying to find what the best balance is.

[Page 620]

I guess that sums up what I'm saying to you today, we need to find ways to find the best balance, whether it becomes a provincial stepping out of education over a prolonged period of time, whether it becomes a trade-off between those on J-class roads, there are numerous issues to look at. What we have indicated to the UNSM is we want to try to see what the art of the possible is here.

MR. EPSTEIN: I would like to move away from the UNSM list while still staying with Municipal Affairs. There is another aspect I wanted to ask you about. It really has to do with the whole question of the extent to which the province will be able to move towards Kyoto goals and the role that municipalities might play in that. I do see in the business plan at least some passing comments about this. They're focused, of course, on transportation. Transportation is second, I think, only to electricity generation in Nova Scotia as being the broad sector that contributes to greenhouse gases. It's well worth dealing with. I see on Page 191 of the government business plan document, again with respect to the Municipal Services branch, that one of the stated objectives is to, "Build on the progress made in the previous year in support of sustainable development by: facilitating and supporting the implementation of new community-based inclusive transportation systems . . ."

I am wondering what you can tell me about this question of community-based inclusive transportation systems. The passage doesn't specifically mention Kyoto, but clearly it's within the context of sustainable development. I assume that the whole point here is to reduce dependence on the private automobile and to promote alternatives. I'm wondering if you can tell me a bit more about what the department contemplates or has been involved with so far.

MR. CHRISTIE: I think you will, of course, know that there's a program for the Access-A-Bus, and the thrust of that inclusive discussion was based on the Access-A-Bus. This is the Community Transportation Assistance Program of which we are looking at a total of $426,000, and it's based on these regions of the country. If this is of any assistance to you, we're happy to provide a copy of it. It indicates the areas across the province where that would be available. That was the thrust of that comment in the business plan.

MR. EPSTEIN: So the emphasis here, as we read the text, should be on the word "inclusive" and the idea here is essentially along the lines of Access-A-Bus or, I assume, other forms of transportation that would make moving around, for those who are not completely physically able, a little easier. Is that right?

MR. CHRISTIE: Yes, that's correct.

MR. EPSTEIN: Okay. In that case, however commendable that is and I think that this is a very worthwhile thing, I have to say I'm worried. I'm worried because it seems to me that there is a role for your department to play in trying to get municipalities to work towards a greater role for public transit and alternatives to the automobile in one form or another. I

[Page 621]

pointed out a moment ago the extent to which transportation really is a major player when it comes to the possibility of making change along these lines.

If anything has characterized our municipal development in Nova Scotia very strikingly in the last couple of decades, it's been the migration of people towards the HRM area and away from living in rural areas of the province, but yet the HRM area is a very large one and it's very spread out. Because of transportation patterns, people who are within one hour driving distance of HRM now consider themselves quite able to move in and out of HRM as a place to work. So that means people can live in the Truro area and come to work in HRM, likewise they can live as far away as Wolfville or Kentville and come here, or as far away as Chester or Lunenburg and target HRM. It's a little harder with the highway system down the Eastern Shore, but at the same time there is again a pattern of mobility back and forth there. So this covers a lot of territory. I know, since you mentioned East Hants earlier, you're very much aware of their urbanizing orientation now.

[4:00 p.m.]

The problem is, of course, urban sprawl. This is widely identified throughout North America as a major contribution to greenhouse gases. It's within the province's power to control this. When I think about the Municipal Government Act, it seems very clear that should the province choose to exercise its powers, they could require the municipalities to plan differently than they plan, to coordinate with one another, for example, to coordinate with respect to transportation in particular. Certainly the amalgamation of HRM from the four previous municipal entities, however controversial and perhaps even dubious some parts of that exercise might have been, at least opened up that possibility of coordinated planning on the transportation front. However, it hasn't happened.

If anything is striking, I have to say about my former municipal council, the HRM Council, it's that planning has been a mess, particularly regional planning. When it comes to the transportation side, there have been a number of haphazard initiatives that have come to the HRM Council and not really been adopted or acted on. Growth is purely developer-driven and the old patterns of putting subdivisions where taxes are seen as lower has really been a major driver of the pattern of settlement that we've seen in the central part of the province.

What I'm wondering is whether the province, through your department, is prepared to take a hand in trying to bring home to the municipalities that something has to be done about this. I'm suggesting that the main policy reason that the province ought to do this is because of the energy and air pollution components. The other main reason is that it now spans more municipalities than HRM, it does involve East Hants and it involves Colchester and it involves Kings County and it involves Lunenburg County. Even given the amalgamation of HRM - that is, the creation of HRM as an amalgamated entity which is already a very large entity - the problem is bigger than that. It's a planning problem that

[Page 622]

transcends the existing county and municipal boundaries that we have. Again, I'm wondering, is the province prepared to get involved in this?

MR. CHRISTIE: Well, let me start with a couple of thoughts on your comments. One of the things from our department, and I indicated in the opening remarks that we were moving to help people be able to do studies on water. That, of course, was one of the priorities the province set when we brought down this drinking water standard last year. Obviously you can't introduce a drinking water standard and say to the municipalities, oh by the way, have that ready and we're not prepared to support you. So we are moving to help do that. I think the number is 22 municipalities that we have talked to.

The other thing I think you should take encouragement about is the Capital District Transportation Authority. In fact, the discussions that I have had with your former council in terms of this have not been on the land-use planning side but on the people-moving side. Indeed, as you look at buses, you look at trains, you look at other areas, I think the realization is that a strategy has to be developed to get people in and out. From the HRM point of view, they want to move people to their place of business and to their houses. From the provincial point of view, we want to be able to get people in and out of the port, to the airport.

We saw ourselves with a common interest, and that was how the transportation authority and where the birth of that idea started from. It doesn't speak to your issue of planning and where subdivisions are, but it does speak to the issue of a long-term plan of how we're going to move people in and out. Then if a developer chooses to go away from those long-term plans, that's basically going to be his problem. Obviously the next phase of that discussion is once you've developed the transportation patterns and plans - I do know from a person who doesn't live in the centre core of Halifax, we always used to sit out in the suburbs and say we wished Halifax would make up their mind whether they want cars or don't want cars. If they want cars, build parking garages; if they don't, do whatever you do so cars don't come in.

I think your former municipality is still grappling with that issue. However, we as a province know that we can't let this great big area make a decision without coming to grips - we want them to be clear on what our goals and objectives are. As I say, I think you can take some encouragement from the Capital District Transportation Authority as kind of moving in that direction, that's where it's intended to go.

MR. EPSTEIN: I'm glad you reminded me of that, because I wonder if you can just tell me a bit more about what you think the Capital District Transportation Authority will do. I was quite intrigued by the references to it in the Speech from the Throne, but I don't know that I ever really understood, in any detail, what it's going to be doing.

[Page 623]

MR. CHRISTIE: It was a concept that was sort of developed through HRM. HRM, for example, and you know as well as I do, they have aging ferries, they have the question of whether they're going to be a city that has cars or parking garages. As we started to talk about that, and you will, of course, be aware that with the big city mayors, in their discussions, their question is can they get taxation, be it from the federal level or provincial level, but can they get sources of taxation so that they can set out their own goals and objectives. It sort of flew out of that.

One of the major overriding purposes that HRM sees, for example, and you will be aware of the Greater Vancouver Transportation Authority, it plans these items. You will recall it was developed for the purpose of when they had the Games out there. However, they do get money directed coming from the federal government because they are a transportation authority. So the HRM concept was that we would kind of look at those other sources of revenues which would bring other sources of revenues to deal with their depleting assets.

From our perspective, we have bridges and it's no secret that HRM has been talking to the province about what the Bridge Commission will do and if there's a possibility of bringing that in. So we have a bridge and we have the Bridge Commission, and we started to say, is there synergy here? Over the last six months we have concluded that there is a synergy working from the HRM goals, and as I indicated to you the goals of the province were to ensure that the major facilities in town, the port, the airport, that people could get in and out, and indeed we knew there had to be additional roads to accommodate the population.

So the question was, were we going to go separately or we were going to go together. The conclusion we arrived at with HRM was that we should go together. That was the birth of the idea of this Capital District. Although you mentioned that you perhaps only heard it in the Speech from the Throne, the discussions have been going on for some four to five months.

MR. EPSTEIN: I actually spent a stint as a member of the Bridge Commission. I was there as one of the municipal appointees to the commission. Of course the structure of the commission is that there are provincial appointments and municipal appointments. I wonder, is that the model of the Capital District Transportation Authority, or is there any model that's been worked out yet?

MR. CHRISTIE: At this point in time what there has been is some meetings between them. The next step is to develop the governance model, and then the next step after the governance model is to get people who are looking at what are the first priorities and what would be the longer term. Although it's in its infancy, the governance model is simply some staff people talking, but there has to be a governance model put in place. Indeed that is the first goal and objective that we have for that authority.

[Page 624]

MR. EPSTEIN: Mr. Minister, you mentioned other sources of revenue and you tied it to the question of the need to support infrastructure. I was wondering whether you contemplate, for highways in the Capital District area, the same kind of financial sources as we now see for the bridges or that we've seen in Ontario for, say, Highway No. 407; in other words, are we looking at toll roads?

MR. CHRISTIE: There are proposals for toll roads, but to say that any of them have been decided would certainly be way ahead of it. What one of the visions was that as this was developed you would attract the federal government, as you would for the Toronto transportation authority, for the Greater Vancouver Transportation Authority, who would, because they have a need to move people around for their ports or other things, come and be involved in this structure. That was one of the goals and objectives.

Clearly, one of the things that HRM, for example, was talking about in this example was that the pass you use to go over the bridge would be the same pass that you would use in a parking garage or on the ferries or whatever. You would simply have the one MACPASS card that would take you to all these facilities. If you expand that, certainly you could include toll roads in that. Indeed, that debate has yet to come. We're just designing the governance model at this point.

MR. EPSTEIN: Any idea what timetable we're looking at for this?

MR. CHRISTIE: Well, in my last discussion with the mayor, he had hoped that by the early summer we would have some structures in place and that we would be starting to look. I think you will recall the House Leader saying that any legislation wouldn't be coming until the Fall. That would suggest that the goals for anything is the Fall.

MR. EPSTEIN: Are the partners, the province and the HRM - what I'm wondering is whether any of the other surrounding municipalities are likely to be involved in this.

MR. CHRISTIE: To this point, it's just been the HRM and the province. I think if you and I were sitting as councillors and/or wardens of other surrounding areas, we might suggest we want to come to the table, but to this point in time there has been nobody else at the table.

MR. EPSTEIN: Well, I think my hour is drawing to a close. I have a number of other topics I would like to deal with but they're likely to take some time, so perhaps I will yield, I think the Liberal caucus has some interest in asking questions. Thank you, Mr. Minister, a big help.

MR. CHAIRMAN: The honourable member for Cape Breton South, your time is 4:13 p.m. You have up to one hour for this minister. You may begin now, please.

[Page 625]

MR. MANNING MACDONALD: First of all, my apologies, our Service Nova Scotia and Municipal Relations Critic is otherwise detained in the other Chamber, so I'm pinch-hitting for him, at least in the first go-around. There are some questions that I have been provided with, but before I get into that I want to say that we do share something in common, we both came from a different world at the municipal level in previous lives. Certainly the problems facing municipalities today are somewhat more complicated than they were in earlier days, in relations between Municipal Affairs, when it stood alone, and the municipalities of this province and the various agreements that were in place around the province.

Today, it's much more complicated than that. Your department has taken on a somewhat different type of role in that you have added to your role. We appreciate that, that things get a little bit more complicated today. Some of the questions I will put to you are regarding various aspects of the operation that now falls under your ministry. Some of the questions, perhaps, are with areas that maybe in the past we wouldn't be talking to Municipal Affairs, we would be talking to some other department. So there is sort of a mix here.

I want to start off, Mr. Minister, by talking about vehicle compliance officers first. We all know that Service Nova Scotia and Municipal Relations, the department, covers so much in terms of the functions and responsibilities. Mr. Minister, on April 4, 2003, the minister's department announced that Service Nova Scotia and Municipal Relations will partner with the RCMP to improve road safety service. Under the agreement, Service Nova Scotia and Municipal Relations would begin sharing commercial vehicle enforcement. Vehicle compliance officers inspect commercial carriers at five weigh scales and through roadside spot checks conducted by officers who patrol the province's highways and roads. As part of that new agreement, about 100 RCMP officers will also be on the watch for unsafe or overweight commercial vehicles.

[4:15 p.m.]

Mr. Chairman, at the outset I have to say that's good for safety, and it's encouraging to see that almost every aspect of the current work of Service Nova Scotia and Municipal Relations employees will not be changed under the agreement because of this signing. My first question to you, Mr. Minister, is, a concern was raised that the agreement included scale houses as well as mobile services, can the minister explain why the scale houses were included in the agreement, since many of the vehicle compliance officers were repeatedly told that the agreement would only apply to the mobile service?

MR. CHRISTIE: Let me interpret your question, I think your question was, are the RCMP going to be involved in the scale houses now?

MR. MANNING MACDONALD: Yes, they're included in the agreement when the compliance officers were repeatedly told it was only going to be mobile.

[Page 626]

MR. CHRISTIE: I think in the initial case, and you will recall, over the years, the discussion has been whether the RCMP should take on that whole job or if there should just be the compliance officers. As that flowed through, the RCMP saw an opportunity to be involved with the scale houses. So the answer is yes, scale houses are involved in the agreement we signed with the RCMP.

MR. MANNING MACDONALD: So that's a change from the original.

MR. CHRISTIE: Yes, it is.

MR. MANNING MACDONALD: Mr. Minister, the RCMP and Service Nova Scotia and Municipal Relations staff will receive cross-training to help them adapt to their new roles. The police will learn how to do a basic walk-around safety check and what documentation commercial carriers must carry; the province's vehicle compliance officers will learn how to use the police communications system and about safety programs conducted by the RCMP. My question to you is, can you provide me with a copy of that agreement?

MR. CHRISTIE: I would be happy to do that. We don't have it right here, but we will undertake that. I was told by the chairman that I am to submit it to the chairman and they distribute it to all the caucuses. We will comply with that request.

MR. MANNING MACDONALD: We also know, Mr. Minister, from the bit of detail that we have that the RCMP officers will stop commercial carriers to inspect their documentation, safety inspection stickers and to conduct walk-around safety inspections, if they suspect a vehicle is unsafe. As well, they can call on the province's vehicle compliance officers to do a roadside safety inspection or to weigh a commercial vehicle. Can you tell me how much that agreement will cost the province?

MR. CHRISTIE: I think the change we have is going to cost zero, but I'm not meaning to suggest for a moment that we're not paying the compliance officers. If you're asking are we going to pay the RCMP for any involvement, the answer is no.

MR. MANNING MACDONALD: And a further question, can you give me some assurance that the agreement will not mean a transfer of that service to the RCMP in the future?

MR. CHRISTIE: I think we can give you that, because I think, as I mentioned earlier, the first concept was that it would be transferred completely to the RCMP and the compliance officers would be phased out as they retired. In the final analysis and a discussion with the RCMP, the vision was that with the RCMP and the compliance officers, we would have more eyes and more people on the road and be able to make it safer. So, the vision now

[Page 627]

is that this will carry on the agreement and the agreement envisages that there will be compliance officers and RCMP carrying on into the future.

MR. MANNING MACDONALD: I want to switch to provincial education funding, Mr. Minister. In the budget we find that the municipalities are taking on more and more responsibility for providing educational funding. We all saw that the budget contained an infusion of millions more in funding for the education system. While this is a good thing for our students, what has been under-reported is the consequences for municipalities because of the government's actions. What's missing here is how the funding will indeed work.

Municipal governments are required to contribute more than $144 million to the Education budget. The contribution comes from the money collected through municipal property taxes, as you are well aware, money the taxpayers expect will go towards maintenance of their own community's infrastructure, something that would be in line with the feeling for many years that people services should be paid for by the province and property services paid for by municipalities. In fact in some municipalities, almost half of the money collected through property taxes is used to fund the provincial Education budget.

Mr. Minister, what's most frustrating and unfair is that the provincial government determines the amount of money municipalities will contribute without consulting municipalities. Currently there is no gap and no mechanism by which municipalities can exercise any control over continually-increasing contributions. The province maintains that education should be a shared responsibility, while the Union of Nova Scotia Municipalities states it shouldn't. We all agree that a solid education system is a cornerstone of a productive and progressive society, however, the responsibility for funding that system sits squarely with the body that makes the decisions with respect to education, and that body is the Province of Nova Scotia not municipal governments. In other words, the province is calling the tune but there are two institutions paying the piper here. The municipalities have very little say.

Mr. Minister, my question is, what is the government doing to ensure that municipal governments that are not involved in financial or operational decisions regarding education but expected to help foot the bill will be able to meet their other expenditures, such as municipal program services and improvements? Simply put, how is your department coping with the fact that, increasingly, municipalities are spending more money on education services and, therefore, are left with less for other services?

MR. CHRISTIE: That's a very good question. There are a number of components to that question. Let me start first by saying that you are absolutely correct, the $138 million from the municipalities goes to education. This year, as you will know, the mill rate for education, which you and I both remember we calculated based on our assessment, did not change this year. What the municipalities paid additionally was because their assessment went up. If their assessment didn't go up, they didn't pay any additional because the rate remained the same.

[Page 628]

For example, let me share with you, our percentage of school funding from property taxation in Nova Scotia is 16.7 per cent. If I cite a couple of other examples, I can tell you Alberta is 38 per cent, Manitoba is 51 per cent, Ontario is 44 per cent, and Saskatchewan is 59 per cent, just to give you a broad sample of those. Indeed, there has been more money coming from municipalities towards education, simply on the fact that their assessment went up.

Now, on the other side of that debate, you, of course, are aware that the UNSM indicates they want to get out of provincial education funding, however, the interim step that we've debated with them is whether there should be a freeze on that and whether the freeze should hold for a while, and the freeze, over a period of time, would phase out. That's the kind of discussion we've had in the last stages. However, as I said, the mill rate for municipalities remained the same this year, and their increased contributions were simply based on assessment increases.

MR. MANNING MACDONALD: Mr. Minister, can you explain why the UNSM's recommendation for a change in the funding structure has not been addressed after three years? My understanding is that it's been three years now since they have asked for it, and it still hasn't been addressed.

MR. CHRISTIE: Yes, it's been a number of years. As recently as, I believe, January, and a chance I had in February to meet with the UNSM executive, we have talked about that. Indeed, as I was just indicating to the previous committee person, we had suggested, between Education and Service Nova Scotia and Municipal Relations and the UNSM, that we would continue to look at that option and see where that is going. You are also quite aware that that's one of the five priorities that the UNSM has this year, and their other priorities have to do with business occupancy tax and a variety of other things. Yes, the progress hasn't been as quick as the municipalities wanted, but we are still sitting down, talking about that one and hoping to make some progress.

MR. MANNING MACDONALD: I refer you, of course, to a document you've seen before, UNSM Priorities. Priority one is mandatory municipal contributions to Education being addressed, and they're still quite frustrated that that hasn't been done. Mr. Minister, it's the second year in a row that the province has surprised Halifax Regional Municipality with an unexpected increase to its education costs. This, after the municipal budget was approved and this year's tax rates had been set. As a result, the HRM, which had budgeted $6 million more in mandatory education costs, is now scrambling to find another $1 million that was announced in the budget. Because of the new education funding formula that affects Nova Scotia municipalities, HRM will now have to pay $7 million more in mandatory education costs.

[Page 629]

Mr. Minister, it's not the first time in recent weeks that we've seen this government treating municipalities somewhat badly or failing to at least work with them, with the respect that they deserve, in other words, having some say over the expenditures of municipal tax dollars. The province didn't give the municipalities a heads-up about the funding formula change before the city passed its budget. The provincial government has an obligation, I believe, to provide a 12-month notice period for any negative impacts. Well, they do have an obligation - that education funding that may cause the municipalities any negative impact has to be in a 12-month notice. Can you inform me, Mr. Minister, and anybody else who is interested, give an explanation as to why the honour, the spirit of the 12-month notice provision wasn't done?

MR. CHRISTIE: Let's start with a couple of issues there. I presume you're not suggesting that we would need 12-months' notice to give HRM a notice of change of assessment. I've never heard that debate, as to whether the assessment would have to be on the 12-months' notice. If that's the case, I, quite frankly, don't understand how HRM would not have known what their education contribution was going to be. The rate was the same as last year. There was no change in that rate. They knew what their assessment was in the early part of January, so I simply don't quite understand how they would not know what to budget for. We can certainly ask them, as to why. I did see that piece in the paper. By early January, they had their assessment. By the first part of April, they knew the rate was the same as last year. So how they arrived at something short of that baffles me also.

MR. MANNING MACDONALD: Mr. Minister, you're aware that some municipalities are deciding whether to seek legal advice, because they feel the province violated the Municipal Government Act by not giving municipalities a one-year notice of any changes, such as the changes I've talked about. In fact, there wasn't even any consultation with the UNSM, according to them, or the municipal units that would be affected. What we've seen is a constant downloading to municipalities of added responsibilities that continue to put them in funding difficulties. The provincial government increases the burden on municipalities without consultation, as I alluded to earlier.

The municipalities are being squeezed to fund the provincially-run program with virtually no say in how that program operates, and frequently it's at the expense of municipal services and improvements because, as you know very well, the municipal tax dollar is only going to go so far. Services to properties in municipalities are suffering as a result of a continuing larger share of municipal available dollars going to people services that I've maintained for some time should be totally funded by the province.

Mr. Minister, I guess my question is, can you describe the relationship you've had with the municipalities in light of not providing municipalities with any meaningful input on any decisions that are being made at the provincial level, regarding the cost-share programs with municipalities?

[Page 630]

MR. CHRISTIE: Well, all right. Let me give you a couple of thoughts on that question. One example I will recite to you, and, of course, as you've looked at the budget you are aware that the province is involving itself with the municipalities providing money to do the studies under the safe drinking water strategy. We're providing money to do that. I guess the other area we have been providing services to municipalities is through the land registry, through the ability to find property and deed transfer through the SAP program for computer programs, indeed for e-mail development and Web site development. So there are a number of areas where we have been working with them.

[4:30 p.m.]

One of the areas that the 12-month rule has been very strong with the UNSM is in terms of the equalization grant. You will know that the commitment was that under the equalization grant we would give 12-months' notice if there was going to be a change. Well, this year, for example, the same amount of dollars are going to the equalization program as were there last year. Now, the debate centres around whether everything, expenses, for example, if we raised the licences on trucks, and municipalities have trucks, would we need to give 12-months' notice? I have had that discussion with the UNSM.

There are some areas where they will see that there have to be 12-month notices, but there are areas where there doesn't. Overall, yes, it's something that we have to clarify. Yes, it's something that has to be defined a little bit more. In terms of the spirit of what was intended from the provincial view was that any change in equalization in the core funding would be given on a 12-month notice. We are still holding to that. It's the other things, we have to clarify.

MR. MANNING MACDONALD: You mentioned drinking water funding, you must have been reading my notes because that's the next question I was going to ask you. With Nova Scotia's new drinking water strategy, we learned that the strategy outlines a three-year action plan to conserve and protect Nova Scotia's drinking water through a three-step process: source protection, water treatment and system operation, and monitoring and testing. What is also evident, Mr. Minister, however, is that this strategy is going to represent a significant expense for all municipalities. What has happened is that the province has established standards but has not really addressed the problem of adequate funding. My question is basic, what is the government going to do to assist the municipalities, not only to implement but to monitor, strengthen and improve that strategy in the years to come?

MR. CHRISTIE: That's certainly the process I was alluding to in the last question. As you know, with the safe drinking water strategy, most municipalities, and indeed the process indicated they should undertake a study to develop the long-term requirements and how these are going to develop. I don't think there's anybody in this province who expects there will be sufficient resources within the province and indeed the municipalities to do this within a very constrained period of time.

[Page 631]

What we have undertaken this year is to provide resources for the municipalities to start to do their studies. We announced, a week ago, the first 20 people who were starting the studies. We expect to have the rest of the municipalities, the water systems, to develop their plans. Our intention is to support them to get these studies done. The studies that are going to be done will show what each municipality will do. Across the municipalities, the needs are going to be substantially different. The needs in HRM will be considerably different than the needs in Queens County or across the way. The first step is to see what we need to do, and that's why we've put this funding up to start with them, so that we can see what we need to do in the future.

MR. MANNING MACDONALD: Mr. Minister, on Page 136 of the Government Business Plan, it states that Environment and Labour will "Increase the number of licences, permits, and application processes handled by the Department of Service Nova Scotia and Municipal Relations in order to improve access . . ." My question is, can the minister explain what processes Service Nova Scotia will be responsible for in the future?

MR. CHRISTIE: Mr. Chairman, that deals with registrations and permits. For example, part of it is through the Business Registry and, let me use an example, elevators. Those would be done through Service Nova Scotia. As I indicated to the last committee person I was speaking with, Service Nova Scotia and Municipal Relations has a large, if you will, data warehouse that can provide those types of services easier than smaller departments building these systems. We view that as part of the efficiencies, people who need to have the Business Registry can call one common area, and indeed do their licence registrations or other things that they would need to do.

MR. MANNING MACDONALD: Mr. Minister, we know the minister for this department has introduced legislation to give police the power to suspend a driver's licence on the grounds that the police officer believes a driver was on drugs. On Page 166 of the Government Business Plan, it states that the Department of Justice will work in partnership with the Department of Service Nova Scotia and Municipal Relations to ". . . increase highway safety and consequently reduce the strain on health care by studying the Drug Recognition Expert Program for possible implementation by the Provincial Police Service . . ."

Without proper identification techniques or proper training, there are substantial questions about determining whether someone is high or not. The question, can the minister tell me why some programs for police to detect possible drug use of a driver would not be available at the same time the law is being brought in?

MR. CHRISTIE: Let me first say that what you're speaking about is a non-alcoholic event. You said the word drugs, I didn't. I assume that there are additional things. The second part of that, the question, is . . .

[Page 632]

MR. MANNING MACDONALD: Well, I'm quoting directly from a government source, the Government Business Plan, Page 166.

MR. CHRISTIE: Absolutely. So the question you raised was about increasing highway safety, and indeed the last part was whether people would be trained. What will happen in this program, if indeed the legislation goes through, is that the RCMP, for example one RCMP officer has been trained, additional training will carry on, and if this legislation is successful, the HRM police have indicated they want to become part of that also. They would become part of the training. It was never envisaged that there wouldn't be fully-trained people. The training will start if the legislation is successful because, as you rightly indicated, people have to be trained to be able to identify that. It's not something that a layperson could just pick up without some training.

MR. MANNING MACDONALD: There's not much sense if the law is brought in and you don't have anybody to enforce it, trained.

MR. CHRISTIE: Absolutely.

MR. MANNING MACDONALD: Another question along that line, how much study has the department devoted, with the assistance of the Department of Justice, to a Drug Recognition Expert Program? Can you give some idea how much of a priority this is, or what kind of resources are dedicated to this, and how soon?

MR. CHRISTIE: Essentially, as you indicated, working with the Department of Justice, the resources would have been dedicated in Justice. If you wish, I can undertake to get that from Justice. At this point in time, they've been sort of doing that work, and we've been doing the implementation part.

MR. MANNING MACDONALD: Mr. Minister, there's also a reference on Page 188 of the Government Business Plan, dealing with Service Nova Scotia and Municipal Relations, referring to the initiatives undertaken to reduce the underground economy. This is not new. This is something that's referred to many times. Can you explain what those initiatives are and how successful they are, and how successful past initiatives were and what you plan on doing in the future? That is a serious problem.

MR. CHRISTIE: The major part of the underground economy in Nova Scotia is a role undertaken by CCRA. The area where we're involved, the principal area we're involved with is in the tobacco taxes, the area of collecting those and monitoring those. You will recall in the last couple of years that as cigarette prices have been increasing there is the debate around smuggling and how that would increase smuggling. Our primary thrust has been to work with the cigarette suppliers to ensure that there is as little slippage as possible there.

[Page 633]

MR. MANNING MACDONALD: There has been some attempt to have discussions to address this matter through the high school curriculum. You are aware of that, could you elaborate a bit on what's happening there, what initiatives, for example, will be employed there?

MR. CHRISTIE: The program you're referring to was piloted in other areas by CCRA. That's one that we have suggested to the Department of Education that we should undertake in this province too, as part of that program. At the present time, it's with the Department of Education with our blessing that it should go forward.

MR. MANNING MACDONALD: On Page 16.3 of the Supplementary Detail, under Net Program Expenses, a figure definitely grabs the attention of our critic and our caucus, for Information Management the budget went from $653,000 to $7.735 million. Can the minister provide a breakdown of what that $7.7 million figure represents? It's quite a significant increase. I know there is probably a logical explanation, but we would like to know it.

MR. CHRISTIE: If you were looking at that page, you would see that Information Management, as you indicated, went up by $7.2 million. If you look further down on the page, you would see Nova Scotia Business Registry, that line item, last year was $5.3 million and this year is zero, and that's because it has been collapsed into that line item that you referred to.

MR. MANNING MACDONALD: Another number that is attracting our attention is the Land Records Reform, which will get another $2.378 million this year over the forecasted funding for last year. Even that figure is down from what was expected by $415,000. Now this year it will receive almost double what was forecasted to cost for 2002-03. Can you provide me with an explanation of that?

MR. CHRISTIE: The honourable member will certainly be aware that we have introduced the Registry 2000 this year. It started in Colchester County, in March of this year. The anticipation is to roll it out in other counties. Those are the monies to implement that new Registry 2000 program.

MR. MANNING MACDONALD: I want to skip down to a question I have here on Nova Scotia Power, Mr. Minister. Recently the Cape Breton Regional Municipality stated that it expected to lose out on an estimated $12 million when it comes to how the province determines the sharing of taxes from Nova Scotia Power. If the municipality was treated like other municipal units, it would receive approximately $15 million in terms of property taxes from Nova Scotia Power. But the actual amount it will get, in total, is closer to $3 million.

[Page 634]

Mr. Minister, with respect to the equalization formula, which is used to assist municipalities across the province, and how the government treats NSPI in terms of property taxes, my question is, for some clarity, can you explain what direction this government is going in or his department is going in with respect to property taxes for NSPI, and how they are distributed to municipal units, and whether or not you're considering a change in that distribution?

MR. CHRISTIE: You will certainly recall that the formula for the distribution of those assets changed from a revenue stream to an asset stream. You will certainly be aware that the municipalities have been saying that they wanted to have NSPI fully taxed at the full rate of assessment for the host unit. You referred to the Cape Breton Regional Municipality. The Cape Breton Regional Municipality would take the full assessment of the assets within their hosting, and take it at their tax rate.

We have had that discussion with them and certainly with the UNSM. Our position has been that although Nova Scotia Power is a private company, there are restrictions on it to deliver their product all across this province. So it's not that they can make a business case decision that it's good to go to Cape Breton or not good to go to Cape Breton or Digby or wherever. Therefore, that makes them somewhat unique. What we have done is we have moved Nova Scotia Power's rate up to $31 million this year. The money was distributed to the host municipalities. As I was indicating to the previous committee member, we have come now to 1.3 per cent of net assets with Nova Scotia Power, which is consistent across the country. Other electric generators across the country would be close to that amount of recapture from the provincial government based on the assessment.

[4:45 p.m.]

Now, your question is, are we ever going to go to full assessment? At this point in time, the province has no plans to do that. Last year, on the rate application that NSPI put in, they were showing approximately the $31 million, and it was indicated that this rate increase was not the generating factor to their request for rate increases. However, we would view it as if we substantially increased that, that it would attract some additional power rates. We don't view that as a good thing for the province.

MR. MANNING MACDONALD: Let me get this right now, Nova Scotia Power is a private company, it has a monopoly in this province to deliver power, a necessity for every one of us in this room and every Nova Scotian, and yet it's allowed to concentrate more on pleasing its shareholders rather than the consumers in this province. By not going to full assessment, I believe that the government is aiding and abetting that process. I guess the question that is asked, and it has been asked many times, is why, in fact, is Nova Scotia Power being treated differently than any other commercial business in this province?

[Page 635]

MR. CHRISTIE: Well, I guess what I was suggesting to you earlier and the last time I responded to that is that we view Nova Scotia Power, as you say, as a private company, it does have shareholders, however, that company does not have the ability to make the decision, because of cost overruns or because of additional cost for delivery, that it should choose not to deliver power to areas of Digby. They are required to do this. I suggest to you that makes them somewhat unique, as to other companies. Consequently, because they are the monopoly, because they have to deliver power, if we are going to increase the amount of rate they pay in taxes, that will have an effect on the amount of rates they charge for electricity, and that would have a negative effect on the province and all the people in the province.

MR. MANNING MACDONALD: It begs the question then, perhaps in the future we should be looking at alternative sources of energy, thereby creating a competition that would give rise to some relief down the road for consumers. I just want to thank you for your time on this this afternoon. I'm not going to keep you too long, Mr. Minister, but there is something that's been bothering me, and I know it's shared by a lot of people in this province, it's the inability for consumers, for people living in this province, to get proper information from your department on the various services that you provide without an advocate.

It's getting more and more difficult for people to actually speak to a live person in your department, whether it's in a licensing department or whether it's in a service department of one kind or another. If you look in the various phone books, you have to know exactly what you're looking for or you're not going to find out how to get any information from anybody in government. It's almost like government has gotten to the stage now where they're hiding their information from people simply because people don't know how to access it. As an MLA, people call us because they don't know who to call, they don't know who they can get the information from. I know you have cut back. There is no such thing anymore as people answering phones and saying, yes, I will direct your call to Mr. or Mrs. So-and-so, who is going to look after your problem.

Right now you have 1-800 numbers all over the place, you're put on a waiting list. If you don't have exactly the right information, you're put on hold or you're redirected. It's getting to the stage now where consumers in this province are having a very difficult time, especially the people who don't have advocates, people who don't have somebody who can pick up a phone and call a number where they can actually speak to someone, like we can. The bureaucrats in the province are operating with limited budgets these days and limited manpower, actually. It's having an effect on the service that we're providing to people in this province.

I know the answer will be, well, we're streamlining, we're getting more efficient, but at who's expense? You're getting efficient at the expense of people trying to get information on government programs, trying to find out what their rights are, their responsibilities are,

[Page 636]

and it's getting quite frustrating out there. If you look at the phone book, if you look at the government directory, you have to go through that directory and you can't find out who is doing what, you have all kinds of people's names with e-mail addresses all over the place but you don't know what they're doing. I wouldn't be surprised if some of them don't know what they're doing these days, because of the way they're shifting. You're shifting departments every year or so or every couple of years.

Responsibilities - for example Access Nova Scotia, try to get hold of someone for a particular problem at Access Nova Scotia. Unless you have an "in" right there or know somebody so that you can actually get somebody, the consumer who doesn't have an advocate out there doesn't have a chance of getting an answer to his question.

I don't expect you to react too much to that, I just want to leave it with you. Our job as public servants is to serve the public out there. I don't think we're doing a very good job of it, because we're not making our programs easily accessible to people in this province who need information. Some of it is information that they require in order to, for example, drive a car or to access a marriage licence or to get a passport, although that is a federal issue, but you know what I'm talking about. It's becoming increasingly more difficult. I am wondering if there is a way that we can simplify the process where Nova Scotians can actually get somebody on the phone and get an answer to their questions.

I will just leave that with you, Mr. Minister. Certainly, that's not an indictment of your government any more than it was an indictment of the government that I was in three and a half years ago, it just seems to be getting worse as we move further into this century. I don't think it's a healthy thing for consumers in this province.

MR. CHRISTIE: I will simply respond to your comments, they are valid comments. On the one hand you have people saying to you, we like the ability to register our car by e-mail or by phone, we like the ability to sit at our computer. Now for my mother, that's a different question all over again. There is no option to her that she is going to deal with that. She wants to see the person, so I do understand what you're saying. Just let me say, we have had an opportunity to open a Service Nova Scotia operation down in Sheet Harbour, we have had an opportunity to do one in Windsor, and down in Shelburne we have people there, for that sole stated reason, that people want to see a person. Calling somebody is a different thing, and it doesn't matter whether you're the provincial government, the federal government, or try to find a planner or who it is you phone in HRM to find a planner, just try to do that. I take your point.

MR. MANNING MACDONALD: Like I said, it's not an indictment of any one government, it's just the way things are going. Like you so rightly just pointed out, everybody doesn't have e-mail. Lower income people in my area have a great difficulty accessing government people to get answers to their very valid questions. Having said that, I will take my leave. Howard, I guess you want to say a few things.

[Page 637]

MR. CHAIRMAN: The honourable member for Halifax Chebucto.

MR. HOWARD EPSTEIN: Mr. Minister, I won't detain you very much longer but I wanted to go back briefly to one point that I raised with you earlier. It had to do with this issue of transportation and the possibilities for your department to be involved. For many years I have tried to be involved in environmental issues. If one lesson has come home to me very forcefully over 30 years of work in the field, it's that barriers to change are not often associated with the absence of knowledge. In general we know a much better way of going about living our lives than we tend to choose to use. The barriers to change are more often attachment to the status quo.

What I wanted to do was to draw your attention to a very recent document on this topic of the problems of transportation and the municipal role. It's a research paper authored by Richard Gilbert, who is a Canadian consultant on transportation. The research paper was prepared for the Centre for Sustainable Transportation. It was prepared for the latest in a series of conferences they have been holding. As it happens, this conference, which was in September, was held in Halifax. The paper has a couple of passages in it that I would like to draw to your attention, with the hopes that you will take the thoughts seriously.

The first point is that, ". . . the basic challenge for transport in Canada for the post-Kyoto period of 2010-2025 is to reduce overall emissions of GHGs from transport activity to 30% below the 1990 level i.e., about 45 per cent below the 2000 level, . . ." The reason for those numbers, when our commitment is 6 per cent, is growth since 1990. If we're going to achieve our target, it means that we're going to have to have significant change in the transportation scenario. Let me quote to you one other statement from this document, "The sprawl of urban areas . . . appears to be an important factor in the growth of transport activity." I don't think anyone could doubt that.

The last section I want to quote for you has to do with the topic of land use, and here is what Mr. Gilbert says, "Compact urban form reduces the need for travel and makes travel by fuel-efficient means - public transit, walking, and bicycling - more feasible. Reversal of decades of urban sprawl will be a matter of further decades. An early start would be advantageous. Waiting until restraints on transport impel higher densities could leave millions of residents and thousands of businesses in progressively disadvantageous positions, increasingly unserved by adequate transportation. Present and recent land-use planning systems do not seem up to the task of remedying sprawl. New tools are needed, including fiscal measures that encourage more compact urban form."

Mr. Minister, I wanted to make sure that you and your officials heard this, so that you would have the opportunity to think about it and I hope act upon it. Ultimately, planning is something, although we entrust to the municipalities, is ultimately within the control of the province, should the province wish to exercise its supervisory authority. It probably wouldn't even take amendments to the Municipal Government Act to do that. There are a lot of tools

[Page 638]

available to the province now, should the province choose to put resources into directing municipalities or planning themselves.

I am pointing out to you, again, that this is a serious problem, it's one that we can do something about, and when disaster strikes there won't be an opportunity to say, we didn't know. Good luck.

MR. CHRISTIE: My deputy noted the book. We certainly will acquaint ourselves with it, and we will engage in some of that debate. I tried, as you were speaking, to picture the debate at the UNSM when we impose those regulations, and it doesn't seem to be a pleasant picture. Nevertheless, nobody . . .

MR. EPSTEIN: You're tough, Mr. Minister. We know you can do it.

MR. CHRISTIE: Thank you. We will certainly take that under advisement.

MR. CHAIRMAN: Are there any further questions for the minister? Any questions from the government side? Hearing no further questions, would you like to close?

MR. CHRISTIE: Mr. Chairman, yes, I would. Before I move to the resolution I would just like to say to the committee members who have had the opportunity to be here today, thank you for the debate. I think we touched on a number of subjects. I hope committee members felt that they were getting if not the full and complete answers they wanted, they were getting good answers because I feel the debate was somewhat good.

I do want to take the opportunity to say to my staff from Service Nova Scotia and Municipal Relations, thank you for the work you've done. This whole process of getting estimates ready and getting business plans ready is a daunting task. As you are looking at all the competing interests that you have within your department, you're trying to meet your service expectations, you're trying to meet all the requirements of the municipal units and various other things, that is a demanding task, to get ready. I want to express my thanks to the members of the department for that.

To the committee, it has been interesting to have a chance to chat with you, but I think the thing we need to always keep in mind is that from this department's perspective our goal is to try to serve the public. We had some discussions just a moment ago about whether we fully meet those needs, indeed there are challenges to be met there, there are things to be done, and we will continue to work to try to do those.

[5:00 p.m.]

Mr. Chairman, as I close, I would like to say that what the department is looking at, as we consider the various factors before the department, as we set the medium- and long-

[Page 639]

term goals, first and foremost we have to determine what the priorities are. There are the internal and external issues with the environment of the department that must be considered as we address each of these plans, these play a role in how we develop. The government has identified their priorities, and we are working towards developing those.

In addition, as I mentioned earlier, I think one of the significant things within this department is that considerable work has been done in undertaking to modernize the Nova Scotia land registration system. The process to convey land is being streamlined by removing the repetitive searches of historical records and will, at the same time, provide consumers with greater certainty of title. These initiatives, undertaken in co-operation with the municipalities, will make Nova Scotia communities more self-sufficient and economically competitive. Provincial funding for municipal structures was to help the physical capacities to support new growth, and equalization funding enables municipalities to remain competitive.

These opportunities will allow the department to increase their service to Nova Scotians and increase the ability of Nova Scotians to get information. With that, Mr. Chairman, I would thank the committee for their indulgence. (Interruptions)

MR. CHAIRMAN: We had given an opportunity, honourable member, for questions. You didn't take the opportunity at that time.

MR. CHAIRMAN: Shall Resolution E30 stand?

The resolution stands.

We will now call upon the Honourable Rodney MacDonald, who is up next.

Resolution E31 - Resolved, that a sum not exceeding $40,805,000 be granted to the Lieutenant Governor to defray expenses in respect of the Department of Tourism and Culture, pursuant to the Estimate and the business plan of the Art Gallery of Nova Scotia be approved.

MR. CHAIRMAN: I would remind everyone to speak clearly into the microphones. If any documents are to be given to the committee, they are to be given to the whole committee and made available to the entire committee. With that brief preamble, we will now call upon the minister for his opening remarks.

The honourable Minister of Tourism and Culture.

HON. RODNEY MACDONALD: Mr. Chairman, just before I start, I was wondering about the time.

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MR. CHAIRMAN: The time is now 5:03 p.m. The starting time was 1:55 p.m. and we will end at 5:55 p.m.

MR. RODNEY MACDONALD: Just to be fair to those who will be questioning me, I will be giving a fairly lengthy opening. I want you to know in advance, that's all. (Interruptions) I feel it's very important to put this on the record, Mr. Chairman, and I will be taking the opportunity to do so. I would be most happy then to answer any questions.

Mr. Chairman, with me today we have Michele McKenzie, my Deputy Minister, who is very familiar, I am sure, to many here in the committee, as well as Kevin Elliott, Manager of Financial Services. We also have David Ross, Director of Policy from Tourism, behind me. Mr. Tom Peck will be joining us from Tourism, if not today, then tomorrow. From the Office of Health Promotion, they are not here as of now but they will be joining us - I can introduce them, perhaps later, when they do arrive. We will have Byron Rafuse, Chief Financial Officer; Tanga Roche, Budget Manager, Financial Services; Janet Braunstein-Moody, Director of Population and Public Health; Wendy Barnable, Director of Communications; and Mike Arthur, Acting Executive Director of Sport and Recreation. So we're going to have a handful of people with us.

Mr. Chairman, I am going to start off my remarks regarding the Department of Tourism and Culture, and following my remarks on the Department of Tourism, I will move forward on remarks regarding the relatively new Office of Health Promotion, which I am sure my critics will have some questions about, especially given the fact that it is one of the newer portfolios.

This year the budget for the Department of Tourism and Culture is $40.8 million, an increase of $1.9 million. As a result, we are in a position to continue contributing to Nova Scotia's economic growth and to provide stewardship to the province's natural and cultural heritage. The department has been able to hold the line with its funding programs, and exciting new initiatives will be announced in the coming weeks and months. Partnerships are obviously a key of many of our projects and initiatives. The department continues working with business organizations, community groups, municipalities, other government departments and other levels of government. I will be mentioning some of those organizations, such as the Regional Tourism Association as an example, a bit later in my remarks.

The department's divisions and operations are also working more closely together on a number of major projects. Certainly I can tell you, Mr. Chairman, that since having the opportunity to become the Minister of Tourism in 1999, I have seen this close relationship continue to grow even stronger. I think that's reflective of the leadership that we see in the staff level of the deputy and of the staff, and I think it's important that we do have those linkages between Tourism and Culture and Heritage.

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The budget for the Tourism Division this fiscal year is $19.8 million, which is an increase of about $1.4 million. Last year Nova Scotia recorded a very successful tourism season. The province's tourism revenues were up 5 per cent for a total of $1.37 billion. The number of non-resident visitors reached about 2.2 million.

Mr. Chairman, I can tell you that at the beginning of the year last year there were some questions, questions from myself as minister, questions from staff and questions from the industry at large, wondering what type of year it would be, because after September 11^th the previous year there were still questions up in the air as to what effect that would have on our tourism season. I can tell you that the industry did an excellent job, along with our staff, planning for the upcoming season. There were questions even up to the middle of the summer as to how we would be doing. I was certainly very encouraged when I saw what happened in August, with a very strong performance during that month.

This year the department will work with the Tourism Partnership Council. The Tourism Partnership Council, as I've mentioned in previous years, is a partnership we have with the industry. There are 14 industry people on that council, as well as two government people from our staff. They do a tremendous job in helping us plan our marketing and product development strategies, as well as a number of other opportunities on committees and research, which I will get into a bit later. Mr. Chairman, we also work with TIANS, the Tourism Industry Association of Nova Scotia, and we have a very strong relationship with them. Certainly they have taken a leadership role for many years in the industry at large.

We are working both with the Partnership Council and TIANS to begin achieving the ambitious new vision, the vision which was released at last Fall's conference, the TIANS conference. The vision calls for 100 per cent revenue growth over the next decade. Certainly, this vision challenges industry, it challenges various levels of government and, really, is there to create an environment for growth in tourism. It will mean a bit of different thinking on our behalf as government as to the role of the industry. In working together to achieve that goal, I think it is possible to do so. As a province, we continue to compete globally for market share, but we are only scratching the surface in our core markets. We need to offer new, exciting tourism experiences to our visitors. Mr. Chairman, we will not be doing that alone.

The department has a strong record in establishing partnerships and leveraging resources. Partnership strategy will be developed this year which recognizes all partners and identifies new ones. As I mentioned earlier, our partners are not only the Tourism Partnership Council and TIANS, we work with municipalities, the federal government, through such areas as the Atlantic Canada Tourism Partnership, and we work with the industry at large. Recognizing the significant impact of the tourism sector to Nova Scotia's economy, tourism industry members and government have created the 2003 Tourism Plan. This plan was driven in a large part by the Tourism Partnership Council and serves as a guide to meet the goals and objectives of the Nova Scotia Tourism strategy.

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The department will work with tourism partners to raise Nova Scotia brand awareness in key export markets. It will do this through high impact advertising campaigns, directed to core markets in Atlantic Canada, Ontario, Quebec, northeastern United States and, of course, Europe. An overall investment of $5.3 million in tourism advertising, combined with a strategic one-time investment of $1 million earlier this year, is anticipated to generate about $129 million in tourism expenditures this year.

Mr. Chairman, I can tell you I was certainly pleased when my colleagues made the decision to move forward with an additional $1 million. I think it was strategic, and I certainly feel that spending additional dollars in Atlantic Canada, in Ontario and in the northeastern United States is important, especially given the events which are currently happening this year. The Atlantic Canada market is very important with over 50 per cent of the tourists visiting our province.

Many of those campaigns, as I mentioned, are underway. An example, Mr. Chairman, is we had a very strong presence a few weeks ago at the Toronto Travel and Leisure Show, earlier in the month. We had over 100 Nova Scotians, including 28 industry operators, participating. Thousands of people visited the Nova Scotia exhibit, which covered more than 100,000 square feet of display space. The comments which came back to me, in speaking to people, even outside the province, was that the show ended up being not just the Toronto Travel and Leisure Show, what it ended being was the Nova Scotia Show because we spent part of that additional $1 million at that travel show to really increase our presence there. We did see a slight decrease in our market share last year. I believe, offhand, it was 2 per cent, although we saw increases in other areas, that, to me, raised some concern. We wanted to see some additional presence in that market.

[5:15 p.m.]

Also this month, we launched an exciting promotional campaign in Atlantic Canada. Nova Scotia's tourism industry challenged the department to come up with something fresh, a new approach, and we did. Most of the reviews of Right Here, Right Now, the TV ad have been very positive, especially from our stakeholders. Certainly, our previous ads spoke very well of what we have to offer here in Nova Scotia, but I think with any advertising campaign you need to be creative and you need to make changes with each new year to see what is working and what is not working. We felt that a change was needed for this year, not to say that we won't be using other additional types of advertising, songs, et cetera, in other markets. The ad will also be seen in over 100 movie theatres in the region. Next month the radio ads will begin. The goal is to get Nova Scotians interested in spending time visiting their own province, and for our neighbours to realize the abundance of things to see and do in our province.

[Page 643]

This year's budget for Tourism and Culture includes $750,000 in new money dedicated to the promotion of the Acadian celebrations, which I can tell you, as someone representing an Acadian region, is very important. There are many other areas such as Pomquet in Antigonish, Clare, Argyle, Richmond, here in Halifax, down in the Sydney area, just to name a few, and I know that many people living in Acadian regions are very excited about the possibilities for the upcoming years. With the anniversaries of French exploration, colonization and settlement, the department intends to provide significant support to the Acadian celebrations through a number of initiatives. Nova Scotia has an opportunity to capitalize on the economic growth potential of major activities and events related to tourism, culture and heritage.

The department's support is much more than promotion and marketing. We have added, as an example, the historical Acadian Village of Nova Scotia in West Pubnico as the newest member of the Nova Scotia Museum family, this being the second that our government has done. We put one in in the year 2000, the Highland Village in Iona. So that makes 27 members of the Nova Scotia Museum family, and they are spread from one end of this province to the other. The department has hired an Acadian liaison officer as a representative of Tourism and Culture to work with Acadian communities and organizations. I can tell you I have heard many positive comments regarding Denise Blanchard-Carpentier from people in my own area and across the province. We're very fortunate to have someone of her calibre.

In co-operation with the Council of Nova Scotia Archives, we will launch the Acadian Experience in Nova Scotia, an on-line resource guide and virtual exhibit to complement the Acadian celebrations and to provide a significant Acadian and Cajun genealogical resource. The department will integrate and highlight Acadian cultural experiences and tourism products in this year's marketing campaign. This includes, Mr. Chairman, a number of vignettes. If you look through the Doers and Dreamers Guide, you will see various sections in the guide and you will see these vignettes, highlighting the Acadian culture in our travel guide. (Interruptions) My colleague is saying something about the orange book, but I'm not going to go off on rabbit tracks. Certainly the Doers and Dreamers Guide is many colours, and that's the way it should be here in Nova Scotia, I believe. I better get back to what I was saying. Again, rabbit tracks, I am not going to go off on them.

Mr. Chairman, we will partner with the Federation of Nova Scotia Heritage to develop workshops for a provincial conference on early Acadian heritage and culture to help communities develop programs for the Acadian celebrations, which I know, of course, in your own riding it's also being very favourably looked upon. We are also thinking more long-term by developing an Acadian tourism strategy through a series of roundtables with stakeholders throughout the province. We will be working very closely with other government departments and other levels of government, such as the Office of Acadian

[Page 644]

Affairs, through the Minister of Finance and Canadian Heritage, to maximize investment for strategic Acadian initiatives.

Mr. Chairman, Nova Scotians are proud of our rich Acadian heritage, and the government is providing a clear indication of its commitment to support the Acadian celebrations. I might also add, in the setup of our Tourism strategy, we have set up a committee, through the Tourism Partnership Council, to take a look at this very issue of our Acadian product. This is not something that is just being developed through the council itself or through our department. We are very much working with the Acadian community, whether it's groups like la FANE or Le Conseil de developpement économique - I have to work on my French, I can say it in Gaelic, but perhaps I can find out for tomorrow if I can say that in Gaelic.

I am going to turn my attention now to the Bay of Fundy, Mr. Chairman. The department is also turning its attention this year to the Bay of Fundy. The region offers a variety of unique experiences, and the opportunity is there to be an internationally recognized tourism destination. Marketing activities will target the northeastern United States, and we will do this in partnership with New Brunswick, Tourism Atlantic and the tourism industry around the Bay of Fundy. The overall goal is to support tourism development in the region by working with individual operators to increase their standards of excellence and commitment to quality.

Mr. Chairman, in the Culture Division of our department, this year's budget provides stable support for the culture sector. Certainly the culture sector is something that I am very interested in and very fond of, even previous to becoming a minister. The department will continue to distribute investment support of approximately $5 million to artists and cultural organizations throughout the province. Nova Scotia's arts and culture community sector continues to grow along with its importance to our economy and to our quality of life. Our music, art, crafts, writing and other cultural activities are gaining prominent national and international recognition.

The sector is recognized as fast-growing with the potential to diversify our economy and stimulate job creation. To ensure that this trend continues, the department's efforts for the coming year will focus on strengthening links with our cultural community, encouraging activity and supporting export opportunities. Just to touch upon the export opportunities, Mr. Chairman, something I'm very proud to say is that since we formed government in 1999, we have seen significant changes in our Culture Division, many of which, perhaps, people don't realize. We took a vast number of programs, and we have streamlined our programs into five main areas. One of them is cultural industries with a focus on export development, which has created opportunities for many an artist or a musician, people who are involved in a variety of sectors.

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I can point to examples of theatres, which have taken the opportunity through this very important program. I can point to individual artists who have been very fortunate to have opportunities abroad, including areas such as France. I know there was a group that took the opportunity to open up a new market outside Paris, which they would not have had the opportunity to do without this program. So we have certainly seen an increase in areas such as CD sales because of this program, something I believe our government can be proud of. Add to that a Cultural Activities Program, which has provided opportunities for many workshops and festivals throughout the province, as well a number of other initiatives, as well as areas for organizations for youth, just to name a few.

An important development in the continuing growth of the cultural sector is the Nova Scotia Arts and Culture Partnership Council. Mr. Chairman, I know you're very aware that I answered many a question here last year. I'm sure I must have been here for six or seven hours answering questions on that particular issue. It's one, I'm very proud to say, that I believe is moving in the right direction. This Council will provide strategic planning advice to the department on new directions and priorities. We have some very good people on that council, some of who I know you are very familiar with.

Specific efforts this year will focus on fostering relationships and partnerships with people active in Nova Scotia's cultural life. It will pursue export development opportunities with our cultural industry producers. In Nova Scotia, our cultural products have significant potential for growth, growth that will translate into opportunities for individuals, businesses and communities throughout this province. The department will work with Nova Scotia's music industry in support of a comprehensive music strategy. Indeed, Mr. Chairman, I can tell you that a vast amount of work has been done in this area already, with people such as Marcel McKeough, who is directly involved in our Cultural Industries Program. We work very closely with groups, such as the Music Industry Association of Nova Scotia.

Again, I can tell you that people such as Don Ferguson in Glace Bay have played a significant role in the music industry here, in helping to celebrate and focus on our local talent. Certainly, as a member of our new Arts and Culture Partnership Council, he will play a very important role in that. Mr. Chairman, of course, being a musician myself, I want to see that particular industry grow to its full potential. Again, as I mentioned, in the Cultural Industries Program, many musicians have taken advantage of that program. I think the opportunities are even greater. Our response to the music strategy, I believe, will be one that is focused on such areas as seeing more opportunities within Nova Scotia for people to take full advantage of the opportunities that exist here. A new Industry Growth Program for Nova Scotia book publishers will also be launched this year. The primary focus will be industrial development, with an emphasis on out-of-province sales. This will include gaining national and international recognition for Nova Scotia stories and authors.

[Page 646]

The department will establish a committee to encourage and support Culture and Tourism initiatives in partnership with our stakeholders. Both Nova Scotians and visitors to our province value our cultural activities, which are an integral part of our social fabric and quality of life. Our cultural sector needs a foundation of stable and effectively-managed organizations and institutions to sustain the sector's health. The department will begin developing an inventory of Nova Scotia's cultural facilities and organizations with a view to identifying needs and also identifying opportunities. We will continue working with communities to preserve and present the Gaelic language and culture as well, which is obviously near and dear to my heart, although I know the member for Victoria, being a Gaelic-speaker, it's probably a lot closer to his own heart, being that he is a Gaelic-speaker, which I believe will be of benefit to all Nova Scotians.

A new Cape Breton cultural development officer, with a focus on Gaelic initiatives will also soon be in place. We announced that last Fall, Mr. Chairman. At the same time, we announced our MOU with the Highland Council in Scotland. Input from public consultations in Gaelic are being reviewed, and working with stakeholders, goals and objectives for the strategic growth of the Gaelic culture will be developed. As well, the department continues to identify specific initiatives which can be undertaken through a memorandum of understanding, as I mentioned, recently negotiated between ourselves and the Highland Council of Scotland.

Having a strong multiculturalism focus in Nova Scotia ties directly into government's core social, cultural and economic goals. The department will begin putting in place a provincial multiculturalism strategy in partnership with stakeholders. Our goal is to develop comprehensive strategies that support Nova Scotia's Multiculturalism Act. Indeed, Mr. Chairman, I can point to an example which is coming up very shortly, I will have the opportunity to speak at MANS, Multiculturalism Association of Nova Scotia's fundraiser this coming Saturday. I know that the staff there and the people involved do a tremendous amount of work and are very excited to know that we have the interest in working with them with respect to our strategies and on the Act itself.

Mr. Chairman, the budget for the Heritage Division has increased slightly to $9.3 million, with approximately $1.1 million for heritage organizations and $2.7 million for 15 provincial museums, operated in partnership with community organizations, those being part of our provincial museum system, although we put a tremendous amount of support out for community museums, which I will touch on during my remarks. Our many heritage facilities continue to attract visitors and Nova Scotians alike. More than half a million people visited our museums last year to learn about and appreciate our heritage. This activity also contributes to economic growth.

[Page 647]

[5:30 p.m.]

The department's efforts in the coming year will focus on improving quality and helping communities to showcase their heritage. Stewardship of Nova Scotia's natural and cultural heritage is a fundamental role of the department which maintains the province's collection of over 800,000 artifacts and more than 200 heritage buildings. Many of those buildings, I can give an example for the committee, would be those of Sherbrooke Village, where, if I remember the number correctly, there are over 100 of those buildings. Certainly I think you could say that is one of the diamonds - I was going to say diamonds in the rough, but I don't know if the member for Guysborough would like to hear that. I think that maybe a jewel in the crown would be more reflective of that.

Mr. Chairman, the Nova Scotia Museum will renew its interpretation of the history and natural history of the province through several related initiatives. A strategy will be developed to make heritage tourism attractions come alive through living history. Certainly we've made that commitment as part of the tourism strategy vision as well, which I think shows that correlation and the strength of putting a separate department together, which I think was really a visionary step on behalf of the Premier.

The Maritime Museum of the Atlantic is a major steward and presenter of the Maritime heritage in Nova Scotia, and an important generator of tourist visitation. The department will undertake a multi-year initiative to examine the potential of expanding the site into a truly significant tourism attraction on the Halifax waterfront. A concept study and detailed feasibility analysis will consider public-private partnerships with key stakeholders, including the Canadian Naval Heritage Foundation - no, not P3, let's make that very clear, Mr. Chairman. The member for Timberlea-Prospect is speaking of P3, but I don't think he has to worry about that - the Canadian Naval Memorial Trust, the Waterfront Development Corporation, the Halifax Regional Municipality and private sector businesses. Especially the members from HRM realize the value of the waterfront here, and realize the value of such museums as the Maritime Museum of the Atlantic, as well the Museum of Natural History.

Nova Scotia's Heritage Property Program is designed to identify, preserve and encourage continued use of Nova Scotia's heritage structures. The announcement of the Canadian Registration of Heritage Property Program by the federal government presents an opportunity to enhance the long-term preservation of heritage properties in Nova Scotia. The department recognizes its role in preserving and presenting the First Nations Heritage and Culture. This year, the department will work with the Confederacy of Mainland Mi'kmaq to draft a stewardship plan to protect archeological sites in Debert. As someone who represents the community of Waycobah, I know that this is seen as very important, whatever area you are living in in the Province of Nova Scotia.

[Page 648]

Also, just to touch on the Canadian Registration of Heritage Properties Program, not too many months ago we had our Federal-Provincial Ministers Meeting. I had the opportunity to co-chair with Minister Copps. This was one of the initiatives which all ministers agreed was a very important initiative on behalf of the federal government. We're very pleased to partner with them on this initiative.

The budget for the Nova Scotia Archives and Records Management has increased slightly to $1.9 million. The Archives is continuing its mobile shelving project to increase storage space at the University Avenue location, diminishing the need for off-site record storage. As well, the department expects revenue of about $100,000 for new storage charges for government departments. The Nova Scotia Archives and Records Management continues to increase its on-line archival resources and now attracts more than 250,000 Internet visitors a year. This year the Archives will produce a number of new on-line products and resources, celebrating the province's heritage and cultural diversity. The Archives is a significant resource for heritage, tourism, genealogy, lifelong learning and educational curriculum development. It's safe to say, Mr. Chairman, that genealogy is fast becoming one of our most important possibilities for growth in our Tourism sector and our Heritage sector across the province.

The Nova Scotia Archives and Records Management also continues to improve and extend electronic records management within our government. This includes the provision of records management services standards and advice, record centre services and management, and the preservation of government archival records. This year a recently-updated corporate records management policy will be put in place across government.

The Department of Tourism and Culture is responsible for managing a wide range of provincially-owned capital assets as well, valued in the millions of dollars. These assets include over 200 heritage buildings, three provincial resort hotels, at which we have a private sector management contract with Newcastle, 11 visitor information centres, the Bluenose II and Upper Clements Park. These assets are managed by the department directly or through agreements with the private sector and not-for-profit societies.

Mr. Chairman, working with TPW, the department will complete an inventory of our heritage buildings and VICs. This will be used as a baseline for development of a long-term plan that sustains these very important capital assets. To improve accountability and overall management of these assets, this year the department will revise and develop formal management agreements at two provincial museum sites to be used as a model for all locally-managed provincial museum sites.

Mr. Chairman, by focusing on strategic priorities this coming year, for Tourism, I believe that the department will continue contributing to Nova Scotia's economic prosperity and to our quality of life. I can give you one example of that just before moving on to the Office of Health Promotion. Just this morning I had the opportunity to meet with those who

[Page 649]

will be counselling in our VICs across the province, many of them were from Amherst, Port Hastings area, many from down in the Timberlea-Prospect area, down in Peggy's Cove, I also know the member for Chester-St. Margaret's is very fond of that particular area. They were getting together, as we do every year, to help educate them on the rest of the province, to meet other staff, to have them learn more about our province so that, in educating our visitors, we can encourage them to stay longer and spend more money.

Mr. Chairman, as I mentioned, I introduced many of the staff a bit earlier, with the Office of Health Promotion. I don't know if any have joined us yet, some have, yes. I see them behind me, and I have introduced them already. I will introduce them just once more for the benefit of the committee. We have Tanga Roche, Financial Services Division; Janet Braunstein-Moody; Mike Arthur; and Wendy Barnable, our communications person.

Mr. Chairman, the fact that we have staff here today from different divisions and departments of government reflects the fact that the Office of Health Promotion is a new entity. We are now in the process of building and integrating that new office. This budget is a merging of some aspects of the Department of Health's Population Health and Public Health with the former Sport and Recreation Commission. The budget is a foundation budget, which will evolve and potentially, I believe, grow over the next few years. Last December, the Premier created the Office of Health Promotion to bring a new, a Cabinet-level voice to the long-term health and well-being of Nova Scotians. I guess many people reflected at that time that we now have a Minister of Illness and a Minister of Wellness and while some people may say that, I say that I think both the Minister of Health and myself have very important roles to play in promoting the wellness of Nova Scotians, as previous Ministers of Health have done, whether in our government or in previous governments.

This, in my mind, Mr. Chairman, is an idea that is long overdue. We are one of the first provinces to make such a move. Over the years, our health care system has fast become focused on treatment, and more dollars, more equipment and more people devoted to caring for those who are sick and injured. An unintended result has been less emphasis, perhaps, on keeping people well. Recent health studies show that Nova Scotia has some of the highest rates of chronic illness, such as cancer, diabetes and heart disease, in the country, costing taxpayers $3 billion annually in medical costs and lost productivity. Of course there are a number of factors coming into that number. (Interruptions) I am not going to go off on rabbit tracks. I know the member for Sackville-Cobequid would like me to do so, but I'm very focused on what I have to say today.

Even more important than the financial cost is the impact of chronic disease on the quality of life for so many Nova Scotians. I think we can all agree on that, as legislators, regardless of which Party we are with. While these statistics give us a snapshot of our current health, others give us a glimpse into our future. We know, for example, that most young people today are not physically active enough to benefit their health and that many may be headed for a lifetime of health-related problems. The good news is that much of this chronic

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disease, as much as 40 per cent, is preventable. As a government we were already taking proactive steps and making sound investments to help Nova Scotians live longer, healthier, more productive lives. For example, the Department of Health is investing $1.5 million annually in the tobacco strategy, a strategy which we have expanded upon this year, which I will touch upon in my remarks.

Last Fall, the Departments of Health, Sport and Recreation Commission, and Education announced a $2.4 million investment over three years for Active Kids, Healthy Kids, a strategy to help our young people become more physically active. That particular initiative, I am quite proud of. The Sport and Recreation Commission took the leadership role in that, worked with stakeholders across the province, and came up with a strategy which I believe is very important for Nova Scotians, very important for our young people. Mr. Chairman, as with any strategy, you always hope to have more money, but we do have a strategy which is in place. We are certainly living within our means to deliver that strategy.

Added to that fact, the research used as part of that strategy is, I would say, the comprehensive research across the country, with respect to students at the Grades 3, 7 and 11 levels. I believe I have those right, Grades 3, 7 and 11. Certainly individuals such as Mike Arthur in Sport and Recreation Commission have played a leadership role. I think if you are going to be putting a strategy in place, you have to have the appropriate research. We don't have the appropriate research to make the decisions we need to make, but I believe we have started changing those ways.

Mr. Chairman, as I mentioned, the Department of Health and the Office of Health Promotion have begun working with other departments and a wide range of stakeholders in the province on a strategy to prevent chronic disease, which will be released this Fall and I believe will play a very important role in what the Office of Health Promotion will be doing over the next number of years. That strategy is being done in conjunction with Dalhousie University, and that particular chronic disease prevention strategy will be very important as we move forward in the upcoming years as a province.

Many people have played a role in different activities, and that's the way it should be because building a healthier Nova Scotia is everyone's responsibility. However, it was clear to us that we could better coordinate and focus our efforts in health promotion and wellness. With a strategic plan and clear leadership, we can move to leverage our investments and make those dollars go even further. That's why we created the Office of Health Promotion and appointed Scott Logan to lead the charge in establishing the new office.

Our goal over the next year, Mr. Chairman, is to work with stakeholders to develop the full vision, mandate and action plan for the Office of Health Promotion. As I mentioned, I believe the chronic disease prevention strategy will play a very important role in that. The new office brings together the related activities and programs of the Sport and Recreation

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Commission and the Department of Health, including tobacco control, active healthy lifestyles and addiction prevention with the respect to the Gaming Foundation.

The total budget for the new office is $14.9 million. That's $1.5 million more than we spent on the same areas last year. The inclusion of the Sport and Recreation Commission in the newly-created Office of Health Promotion reflects the significant contribution that recreation and sport makes to health promotion, both at the individual and community level. I know that members, such as the member for Timberlea-Prospect, know all too well the importance that sport and recreation will play in one's life.

[5:45 p.m.]

Active living through the development and sport of physical fitness, recreation and sport continues to be one of our core business areas and is central to the mandate of the Office of Health Promotion. We will continue to work with the Department of Education and other stakeholders. I know the member for Dartmouth North has asked questions regarding the relationship with Community Services, and I just want to put on the record that we certainly are also working - and that will obviously be one of our focuses - with all departments, including Community Services on such initiatives as I will outline, perhaps later or perhaps during questions from that particular member, if he should wish.

We will continue, as I mentioned, to work with the Department of Education and other stakeholders to facilitate physical activity and recreation in schools, and to implement the Active Kids, Healthy Kids physical activity strategy for children, youth and families. Through our Sport and Recreation Division, the Office of Health Promotion will continue to play a lead role in building healthy communities, providing personal health, social economic and environmental benefits. That means supporting, promoting, volunteers and leadership positions in Sport and Recreation through investments in programs such as the High-Five Program, through Recreation Nova Scotia, and also Sport Futures.

Mr. Chairman, the Sport Futures Program is a program through Sport Nova Scotia. We have signed a bilateral agreement with the federal government on that initiative. The Medical Society is also involved in that. Last summer we saw 1,200 more participants in baseball, with the leadership of Mark Smith. It was a pilot project that proved to be a very good pilot. We're certainly very pleased with that partnership we have with Sport Nova Scotia, as well as through High-Five with Recreation Nova Scotia.

As well as our funding of provincial Sport and Recreation organizations, a large portion of our overall budget is funding and grants to support regional, community-based programs. An example of that is our grants to support and encourage the development of facilities and infrastructure for sport and recreation. This budget puts an additional $405,000 into the RFD Program, the Recreation Facilities Development Grant Program, restoring the fund this year, Mr. Chairman, to $2 million.

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This program continues to help communities across the province develop recreation facilities which contribute to the health and well-being of Nova Scotians. These aren't only large projects, there are small ones. We are all very familiar with them. They can be a $2,000 project or they can be a $100,000 project. We all know the value of those, whether it's for a local community hall, an arena, a facility, whatever the case might be.

It is set up to encourage well-planned, properly scaled, sustainable facilities in all areas of the province at a price that is fair and affordable for the taxpayer. There are current pressures, of course, on this program, mainly caused by aging facilities and shifting population needs. Facilities built to accommodate the baby boomers are now needing significant renovation or replacement. In other words, I believe over 70 per cent of our facilities are over 25 years old. We always have many more requests than we can fund, but we try to take a fair and balanced approach to distributing the funds available.

It is quite incredible, Mr. Chairman, by leveraging community support, just what we've been able to accomplish with these grants in terms of enabling positive projects to go forward in communities across the province. We are now evaluating another round of applications, and we will have an announcement to make about this year's funding in the near future.

Mr. Chairman, I said that active living is one of our key areas of focus, another important area is tobacco control, and this budget contains an additional $250,000, new money, to build on our very successful tobacco strategy. That brings a total annual spending on our tobacco strategy to $1.75 million. The strategy, which includes smoke-free places legislation, tobacco tax increases, public education, support for people trying to quit and youth programs, is making a difference. As a result of this strategy and related activity, we have seen decreases in the both the overall and teen smoking rates.

Two years ago we had the highest rate of smoking in the country, at 30 per cent. Since 2001, that rate has dropped by 8 per cent, down to 22 per cent. In fact - staff might correct me - I believe it has dropped further, to 21 per cent. I apologize, I stand corrected, it's at 22 per cent. We have also experienced a dramatic 13 per cent decline in youth smoking since 1998. The new money for the tobacco strategy was spent in the area of cessation. Some more detail on that will be forthcoming in the next couple of weeks.

Mr. Chairman, the budget also includes $350,000 more for new, enhanced health promotion programs. Some of that, I am sure, will help to address another key area of focus of the Office of Health Promotion, healthy eating. For example, we recently announced an initiative to support healthy food choices in schools. In the coming months, we will work with the Department of Education, schools and school boards - and we have been already - to build on the good work that is already underway in a number of schools throughout the province, around healthy school food policy. The goal is to establish some provincial policy

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and greater standards. In the interest of time, I am wondering how much time I have left in my opening hour?

MR. CHAIRMAN: Five more minutes.

MR. RODNEY MACDONALD: Hopefully I will be able to get through my remarks. Mr. Chairman, while we continue to implement and build on our ongoing initiative this year, our primary focus will be working with our many stakeholders to establish the new office, division, structure and mandate. I have already had the pleasure of meeting with many of these stakeholders. They are an enthusiastic group of individuals . . .

MR. CHAIRMAN: Mr. Minister, you have five minutes until adjournment, but you can carry on your remarks tomorrow, if you so desire.

MR. RODNEY MACDONALD: As I mentioned, I have already had the pleasure of meeting with many of these stakeholders. In fact, I was asked a question by the former Minister of Health, the member for Dartmouth East the day before yesterday, about the Cape Breton Wellness. I do certainly stand corrected. I had mentioned that I would be willing to meet with them. In fact I did meet with, not the board but, a member of the staff. I indicated that I would be more than willing to meet with them. In fact, I had met with, her name is escaping me, I can get it for the honourable members around the table, to have some discussion on the wellness. It had escaped my mind when he had asked me the question. I certainly wanted to put it on the record in committee. Should the member want me to do that in the House, I would be more than willing to do so and to provide him with any sort of an update that he would require. Perhaps the member for Glace Bay could forward that on to his colleague. (Interruptions) Thank you.

Mr. Chairman, as I mentioned, I have met with many stakeholders. They are an enthusiastic group of individuals and organizations, and I can tell you they wasted no time contacting our office to meet with us and to offer their ideas, their encouragement and their support. Many of them, and I believe all of them, applaud the creation of the Office of Health Promotion. One message that I have heard repeatedly, regardless of which group, whether it's the Cape Breton Wellness or whatever group it might be, they have all said that they do not want to see this office take a shotgun approach.

What they want this office to do is to meet with the groups, get input on what they see as priorities, what we see as priorities, to work together on a comprehensive plan, not a plan that just lasts for a year, not a two-month plan, but a plan that is multi-year, a plan that takes a look at the many facets of wellness and what encourages an active lifestyle and a healthy lifestyle here in Nova Scotia. I made the commitment, in fact, with the DHAs or whoever it might be that that is the approach we will take. With respect to that, Mr. Chairman, again I go back to the chronic disease prevention strategy which I believe will play an important role, in many respects, for our office.

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Mr. Chairman, problems such as chronic disease took years to develop and it will take many more years to fix. They've said that to make a real difference in our health status, we need a long-term plan and strategic, sustainable solutions. They see the creation of the new office as a golden opportunity, and they say we must take the time to do it right. We agree, and that's exactly, as I mentioned, what we're going to do.

One of our key projects already underway, in collaboration with those many stakeholders, as I mentioned, is the development of the chronic disease prevention strategy. The strategy will address both lifestyle and social factors, and we will build on the good work to date, such as our tobacco strategy and our physical activity strategy, as well as programs and initiatives with stakeholders such as the Canadian Cancer Society, the Heart and Stroke Foundation, which I also had the opportunity to meet with, the Canadian Diabetes Association, and the Medical Society of Nova Scotia, who, again, I had the opportunity to meet with as well, and many more.

MR. CHAIRMAN: Mr. Minister, the time for adjournment has come. Time remaining for you in your hour at adjournment is eight minutes. The time in Supply today began at 1:55 p.m. and ended at 5:55 p.m., four hours. The committee is to reconvene on Friday, April 25^th after opening business in the Chamber. The total time in debate, as of right now, is 36 hours.

The committee stands adjourned until tomorrow.

[5:55 p.m. The committee rose.]