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HALIFAX, MONDAY, APRIL 26, 2004

SUBCOMMITTEE OF THE WHOLE HOUSE ON SUPPLY

3:04 P.M.

CHAIRMAN

Mr. William Dooks

MR. CHAIRMAN: I would like to welcome everyone here today, members of government, Opposition and staff members. We're starting this afternoon, at approximately 3:05 p.m., the estimates. I would like to call the estimates of the Department of Agriculture and Fisheries. Mr. Minister, you have one hour for your opening comments and remarks, and if you should finish up before that time, that's fine. At that time, we will turn it over to the members for questioning. Members, it's one hour in turn for questioning.

Resolution E1 - Resolved, that a sum not exceeding $40,796,000 be granted to the Lieutenant Governor to defray expenses in respect of the Department of Agriculture and Fisheries, pursuant to the Estimate and the business plans of the Nova Scotia Crop and Livestock Insurance Commission, the Nova Scotia Farm Loan Board and the Nova Scotia Fisheries and Aquaculture Loan Board be approved.

MR. CHAIRMAN: The honourable Minister of Agriculture and Fisheries.

HON. CHRISTOPHER D'ENTREMONT: Mr. Chairman, it's my pleasure to be here today to talk about the Department of Agriculture and Fisheries. Before I begin, I would like to take a minute to introduce my staff who are here with me today; Daniel Graham, Deputy Minister, and for my Finance CSU, we have Weldon Myers. I'm going to try to keep this as brief as I can. I will probably table a couple of pieces for your indulgence, to try to save this up a little bit so we have more time for questions.

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Today we'll outline the challenges and opportunities facing the Nova Scotia Department of Agriculture and Fisheries, and more specifically address how, through our proposed budget, we will address some of the issues and seize some opportunities. The agriculture, aquaculture and fisheries sectors are significant economic drivers in Nova Scotia's rural and coastal areas. These industries are not just a way to do business, but a way of life for many generations in Nova Scotia. With time, we're getting better at it, we're getting more productive, and our products are garnering a high-quality reputation. This doesn't mean that we are not without challenges, however, and we have experienced many in this last year.

Economic growth, environment impacts, food safety, livestock health and education are concerns that impact and shape the future of these resource sectors. The unplanned, such as this year's unique weather, has challenged our agriculture, aquaculture and fisheries sectors. September's Hurricane Juan and February's snow blizzard both left their marks. We continue to rebuilt, restore and move forward from Mother Nature's wrath. Nor could we foresee the impact of international, national and provincial food safety and bio-security issues. We continue to experience the fallout of bovine spongiform encephalopathy, the Avian flu and MSX.

In an effort to address these overall challenges, the department has set out strategic priorities and initiatives to seize emerging opportunities. As we enter the new fiscal year, the department is engaged in policy initiatives that will provide guidance and shape the future of both our aquaculture, agriculture and fishing sectors. The province is fully engaged in the Agriculture Policy Framework, or APF. The APF is a federal-provincial-territorial effort, which sets a new strategic framework for agriculture over the next five years and beyond. This umbrella accord establishes a common action plan that centres on five areas: environment; food safety and food quality; science and innovation; renewal; and business risk management. Implementation of the APF commenced this past fiscal year.

Nova Scotia continues to benefit from a strong commercial fishery, which is vital to the economy of our coastal communities. Over the next year, the department will continue its participation in a national fisheries policy review. This policy review sets the direction for long-term management of marine resources. The Aquaculture Policy Framework released by the federal government sets a longer-term vision for Canada's aquaculture industry. The department continues to work with the federal Department of Fisheries and Oceans to move this important sector forward. It focuses on environmental monitoring and the development of a new national aquatic animal health program. Nova Scotia prides itself on a successful sport fishing industry. The department continues to work with its federal, provincial and municipal counterparts, as well as many volunteers to develop agreements on freshwater fish habitat and recreational fisheries.

Economic stability and growth continues to be the common goal in the agriculture and fishing industries. Despite challenges, these resource industries remain crucial to the future of Nova Scotia's economy, primarily because of efforts targeting growth and innovation.

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Agriculture, commercial and recreational fishing, aquaculture and related businesses are the economic base of our rural and coastal regions, employing over 28,000 Nova Scotians and contributing some $2 billion to the provincial economy.

Close to 4,000 farms produced $416 million in farm cash receipts in 2003. Seafood continues to dominate Nova Scotia's exports, posting a new record of almost $1.2 billion in 2002. The combined foreign exports of the Nova Scotia food manufacturing industry, the fishing industry and agriculture, total $1.1 billion. Nova Scotia's food manufacturers made direct export shipments to 79 countries last year, and the value of aquaculture farm-gate sales increased by 30 per cent, from $28 million last year to $40 million this year. There are about 4,000 people employed in agriculture, related manufacturing, and 1,000 in agricultural services.

Mr. Chairman, I would like to table the government's corporate plan, as relates to the Department of Agriculture and Fisheries. Our department's strategic goals, in accordance with its mission and legislated mandate, the Department of Agriculture and Fisheries will continue to work towards sustainable and environmentally-responsible development of Nova Scotia's agriculture and fishing industries; a competitive business climate that encourages economic growth and job creation in Nova Scotia's rural and coastal communities; orderly development of agriculture, aquaculture and fisheries through a regulatory regime, which supports business and sector growth, and which ensures consumer confidence in food safety; globally competitive Nova Scotia workforce through education, training, research and community services; and public services that are accountable and serve to meet identified industry needs.

Again, Mr. Chairman, I would like to table some more departmental priorities. I can take some time to talk about our agriculture industry. A central focus has been the APF. This is a federal-provincial-territorial government initiative. Statistics of the census released last year show there have been significant increases over the last five years. Agriculture does have its ongoing challenges, such as keeping up with technology, farm labour, farm debt, changing demographics, urbanization of rural areas. More recent challenges within the agriculture sector deal with BSE, livestock health, bio-security, branding, weather, processing plant closures and adjustment to the new BRM programs.

The department, through invested provincial funding, has the potential to provide assistance of $36.3 million to the agriculture industry in support of the 2003 production year. In addition, there are $28 million in NISA accounts, which we have invested, along with the federal government and participating producers. The department continues to work with EMO to access flood damage to provincial infrastructure as a result of last March's floods. We were able to get critical in-stream provincial infrastructure repaired in the Upper Stewiacke and Antigonish areas. The farmland damage claims are being handled by EMO, with technical advice being provided by the department.

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The province committed $10 million to help farmers, foresters and fishermen affected by Hurricane Juan. The province also implemented or this was the enhanced disaster relief program to help farmers. Through our various development programs, such as the Farm Investment Fund, Agrifood Industry Development Fund and the Technology Development Program, the department provided almost $5.5 million. Through our BSE program, in response to the BSE Task Force, the department provided $8 million of which $1.6 million will be provided through the CAIS Program.

As the only province in Canada to provide a second year of bridge funding to help producers transition to the new BRM programs, the department paid out $2.5 million. Under the new CAIS Program, the department committed $5.1 million, attracting a potential $7.6 million, federally dependent upon producer participation. Under the CFIP, the department paid out a cost-shared amount of $3.2 million. We also offered $600,000 to the New Entrants Program, which provided forgiveness on loans.

With regard to the pork industry, the department offered a Hog Loan Support Program totalling $4 million. Again, in December 2003, the government approved a $3.5 million loan in response to the hog industry's request for assistance while market prices returned to normal values. Over 30 loan applications were received for a total of $2.3 million committed. I'm pleased to note that the market price is rebounding. To further assist the pork industry, the department will be meeting with the board of Pork Nova Scotia in May to talk about a strategic plan for the industry as it looks into the future.

The occurrence of BSE in western Canada - there has been some serious disruption in the cattle and beef markets. A comprehensive package of support programs has been delivered to all the segments of the ruminant livestock industry as a result of the BSE issue. These programs provide in excess of $8 million to the sector. A recent announcement of the federal transition income support program will provide an additional $4.4 million in income support, bringing the total in Nova Scotia to $12.4 million. This amount exceeds the amount of $10 million that was recommended by my BSE Task Force. On that note, I would like to recognize the BSE Task Force members and the participants at the various public meetings for their work.

While there will continue to be impacts in 2004, there have been some positive developments in the cattle industry, which includes the export of boneless beef to over a dozen countries, slaughter cattle volumes are running at about pre-BSE levels. Recently, on Friday or Thursday, there was an announcement that bone meat will be allowed into the U.S. market. As well, consumer confidence in our country's beef remains very strong. The department is also involved in a recently-announced branding initiative by the Office of Economic Development. Premier Hamm is actively pursuing a buy-local initiative with his colleagues through the Atlantic Council of Premiers.

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With regard to the Avian flu, the department is participating in the national Communications' efforts on this poultry disease. We would remind producers to practise on-farm bio-security measures and have delivered these measures through direct letters to producers. With regard to the environmental issues of spreading biosolids on farmland, we await the results of the Department of Environment and Labour's review of this practice. The department remains committed to the agricultural industry, and the 2004-05 budget ensures that programs and services will be maintained and delivered.

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Now I would like to speak to the Fisheries sector. Nova Scotia continues to lead Canada in export fish and seafood products, the dollar values exceeding almost $1.2 billion in 2003. The U.S. market remains the primary destination of our fish and seafood products. This is followed by Japan, France, China, Denmark and Belgium. Thousands of people are employed in the seafood processing industry here in Nova Scotia. The aquaculture industry alone employs about 1,200, both full- and part-time jobs. Our inland recreational fishery generates millions and helps our tourism industry.

In 2002, the provincial crab fishery had a landed value of $73 million. The exports were valued at over $153 million in 2003. We expect the value to increase this year, as we do the employment associated with this sector of the fishery. The offshore scallop fishery is the largest scallop fishery in Canada. In recent years, annual landings range from 50,000 metric tonnes to 90,000 metric tonnes, with an estimated value of $69 million to $121 million. Aquaculture product is worth almost $40 million. The export value of lobster is around $441 million.

As we see strong markets in our boat-building industry, the value of our boat-building industry has doubled in recent years. The industry's annual sales increased 60 per cent to $80 million, while total exports increased threefold to $45 million. However, as in agriculture, the fishery has its challenges. Some of these challenges are helping new fishermen getting into the industry, First Nation negotiations, a downturn in the groundfish sector, water issues around access equality, illegal fishing activities and maintaining processing facilities.

In addition to these, there are concerns about access to water, particularly when it relates to aquaculture sites and oil and gas exploration. There are many competing interests and the department believes there is a successful way for all interests to exist and prosper. The MSX disease in oysters found in the Bras d'Or Lakes has been a real challenge for growers and, as a result of federal restrictions on oyster movement, has caused significant hardships for oyster farmers who are unable to move their oysters from seed locations to their farm sites. While this is not a human health risk, it is serious for our growers. The department has committed $25,000 to our industry to study the science of MSX, so we can better understand the parasite and its movement. As well, the department is committing another $25,000 to industry partners to re-seed oysters in the affected areas.

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The government continues to be committed to addressing the illegal trade of fish and fish products by increasing fisheries enforcement efforts. All regions are being monitored through the joint efforts of our department and the Department of DFO, CCRA and CFIA. The 2004 fish buyer and fish processor licences have been issued. For the first time licence holders will be requested to collect the harvest licence number of fishermen that they are buying from. This will be a term and condition of the licence in 2005. The licence conditions are tools of enforcement used by the department to address proper management in the movement of fish.

This past year, the department sponsored a fishing representative fact-finding mission to Norway and Scotland, to learn how conflicting issues of fishing and oil and gas coexist. A report with recommendations was recently presented to me at the ministers' fish conference. DFO released its policy framework for the management of fisheries on Atlantic Canada's coasts on March 25^th. We are still awaiting DFO's response to the issue of owner/operators as identified in the consultation phases. The department continues its efforts with DFO to negotiate an MOU on fish habitat. We are the leader in working with volunteers to restore degraded fish habitat, and want to eliminate red tape and simplify the process for undertaking habitat restoration. The department has been engaged in dialogue with industry and federal government on many concerns over the last year. We will continue in this vein to help our entire fish sector.

There have been a few developments this past year in regard to Nova Scotia products. With regard to moving our shipments of food products, the province has been participating in a U.S.-Canada working group to facilitate the movement of our seafood in particular. The concerns were widely shared by the U.S. food businesses and organizations, and an interim final regulation addressed the major trade concerns for prior notice. Full implementation and enforcement will start in August, and we trust that our seafood will cross the border in the time required to maintain its quality and its price.

A National Wine Standards Committee was established in 2002, and they've developed draft standards. We do not believe that the present draft reflects the interests of the Canadian wine industry as a whole, and the department continues to have discussions with other provinces in an effort to clarify the concerns regarding the issues around competitiveness and quality.

Now I would like to address the department's 2004-05 business plan. The department will continue to address external pressures related to the environment, industry growth, food safety, and education and training through the APF. The signing of the Canada-Nova Scotia Implementation Agreement for the Agriculture Policy Framework represents a milestone for addressing the major challenges impacting the agriculture and agrifood sector. The following captures the major challenges that will be addressed in the 2004-05 business plan.

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Environmental issues related to water, air and soil quality continue to present significant challenges. As part of this commitment to climate change, the department is working with industry, government agencies and academia to coordinate initiatives aimed at mitigating greenhouse gases. The department recognizes the importance of responding to these and other environmental concerns, and is working with industry to balance development with environmental and social responsibility.

Agriculture and fisheries are recognized as foundation industries and play a key role in advancing the government's broad economic growth agenda, and opportunities for prosperity. Food safety issues itensified in 2003-04, due to concerns with bovine spongiform encephalopathy. Markets and consumers seek assurances that the food they purchase is safe and of high quality. To respond to this challenge, the department must address issues of production and product standards, food labelling and traceability, monitoring and inspection, bio-security protocols, food-handling education, and analytical testing.

Implementing food safety programs under the Canada-Nova Scotia Implementation Agreement for the APF, as well as the integrated food safety system, will enable Nova Scotia to brand its food products as meeting standards of quality and safety, and will sharpen its competitive edge in domestic and export markets. Education and training will continue to be a focus for 2004-05, particularly as the government addresses labour market needs through the Skills Nova Scotia Framework initiative. This initiative will provide ongoing opportunities for Nova Scotians to keep their skills current and responsive to changes in the labour market.

One of the biggest opportunities for our department is the APF. I wish to explain to you some of what the APF means to us and where we see our programs fitting under this national program. To address challenges facing our farmers, Nova Scotia is working with the Government of Canada, other provinces and territorial governments to lay a foundation for a stronger agriculture and agri-food sector now and in the future. Through the Agriculture Policy Framework, governments are setting out a plan that will make Canada the world leader in food safety, quality, environmentally-responsible production and innovation.

In June 2002, the Government of Canada and the Government of Nova Scotia signed a framework agreement on agriculture and agri-food in the 21^st Century. This agreement shows the commitment of these governments to work together on the development and adjustment of programs, services and tools to help producers succeed today and tomorrow. It also identified the common goals they will pursue over the next five years. There are five elements of the APF - and I think I'll table those in a second - food safety and food quality, environment, renewal, science and innovation, and business risk management. I will just table these rather than going into detail with them. Members should be able to read these at their leisure.

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I will speak for a few moments about branding. Canada's agriculture and agri-food sector enjoys a positive image abroad and has been recognized for its ability to deliver consistently safe and high-quality agri-food products. This success has helped Canada become the world's third-largest exporter of agriculture and food products. The program's services and tools supported under the APF will help producers achieve real improvements in food safety, food quality, environment, renewal, and science and innovation. These improvements will provide a basis for continued work on positioning the Canadian agriculture and agri-food sector as a world leader, and for strengthening Canada's position in global markets.

Governments will work together to increase international opportunities and recognition for the sector by branding the Canadian agricultural and agri-food sectors, and the fostering of market opportunities. Work on trade issues will also be strengthened to obtain better access for Canadian products by reducing traditional barriers and overcoming newer technical barriers. Governments will work with the sector on a regular basis through value-chain round tables to facilitate the development of marketing and branding strategies and to help establish priorities to ensure that the details of government policy support expanding markets abroad.

The department is an exciting place to be, because our successful and imaginative industries make it so. This fiscal year, the department will manage a stable budget. The 2004-05 budget target is $40.661 million. This is a slight increase from the 2003-04 estimate of $40.118 million. The 2003-04 forecast was a one-time increase due as an additional $3.5 million to producers to help them with the BSE issue. The estimates of 2003-04 to 2004-05 show a net increase of $678,000. The increase was required to meet contract settlements at the NSAC, department-wide salary adjustments, transfer of an inspector from the Department of Environment and Labour to our department, and a one-time loan reserve adjustment in 2003-04.

We will be able to maintain all programs and there will be no staff reductions. The department is confident we will be able to successfully continue providing the same level of service to our client industries. Some service costs have increases, as have others across government. These increases were necessary to offset the increasing cost of delivering services. While fees were increased, the department did not introduce any new fees. We were able to maintain what we have, even with the unforeseen natural crises, like Hurricane Juan, floods and BSE where program costs rose.

In closing, I'd like to reiterate that Nova Scotia's Agriculture and Fisheries industries are key to our economy and are so very important to our rural and coastal communities. These sectors provide employment and career opportunities that enable Nova Scotians to work in traditional industries, live in rural and coastal areas, train in Nova Scotia, and enable our young people to stay right here at home. Agriculture, fisheries and aquaculture continue to evolve. They will require research, new technologies and education to strike the right balance for economic prosperity and environmental integrity. Through the progressive and

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entrepreneurial nature of our farmers and fishermen, Nova Scotia is prepared to capitalize on opportunities in the life-sciences sector, involving demands for high-quality value added products. Fair trade practices are essential here at home and internationally.

Education and leadership development are key to future success and growth, and Nova Scotia is well positioned to provide relevant, forward-thinking educational opportunities through the NSAC. As you have heard, the Department of Agriculture and Fisheries is an active partner and responsive leader in Nova Scotia's agriculture, fish and aquaculture industries. Thank you for your time, Mr. Chairman.

MR. CHAIRMAN: Thank you very much, Mr. Minister, and just to let you know, the volume was good, it wasn't too loud, it was fine. And thank you for not being as loquacious as the first Minister of Agriculture and Fisheries who we had to listen to.

MR. D'ENTREMONT: It was longer, Mr. Chairman.

MR. CHAIRMAN: No, it was very good. Anyway, we will now start our round of questioning with the Official Opposition.

The honourable member for Hants East.

MR. JOHN MACDONELL: Thank you, Mr. Minister, and I want to welcome your staff, and in particular, your new deputy. I get to cross paths with Mr. Graham on occasion in my community, and the Department of Natural Resources budget estimates for some time now, so I look forward to working with him in the Department of Agriculture and Fisheries.

The first question will seem like a strange one, where can I get an Acadian flag?

MR. D'ENTREMONT: At the flag shop. We'll put you down for one.

MR. MACDONELL: Good, thanks. I guess one of the first things I want to do is to highlight what I see as the importance of the agricultural sector, and I'd be interested to give you this message, I guess. I asked your deputy, I don't know if he conveyed it when I saw him, I think it was the Horticultural Congress meeting in the Valley.

We hear a lot about issues of security; the federal government has put Anne McLellan in the job of safety for the Canadian citizen and I hear almost nothing ever said about a country trying to feed its own people, the security issue around that. Just the implications, if it ever was impossible to bring food across the border, and there is a fair bit that does come to Nova Scotia from the United States. I'd like it if you would take this as a suggestion of looking at the pitfalls I guess, in particular of trying to put Nova Scotia in a position to grow as much of its own food as possible for its citizens. I'm not sure what the implications are in terms of NAFTA on that, but I've been trying to find out.

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[3:30 p.m.]

So that is something I think any country should have a policy to feed its own country, and in light of the present atmosphere around all security issues, it may be in our best interests to try to do that as much as possible, simply we may run into a problem with getting food across the border. I don't know if you want to comment.

MR. D'ENTREMONT: Ultimately, Mr. Chairman, I liked the statement, it was a very good point to bring forward when it comes to bio-security and the safety of our food supply. We do import an awful lot of agriculture products, fish products as well when you do look at that. CFIA tends to be the lead agency when it comes to food imports and what have you, and I know that we do have that discussion quite often at the minister's table about food security and a lot of the supplementary imports and issues surrounding that. Thank you for that.

MR. MACDONELL: I don't know if you remember, back I think probably September, and you would have been fairly newly minted at that time, and I'm not saying that the shine has worn off, but I wrote you a letter asking if either you could investigate, or push the federal minister to investigate why there is such a discrepancy between the retail price of beef and the price that producers were getting under this BSE problem. I don't have the correspondence with me, but it struck me to be a little vague, that may possibly, but I'd like you to address that. If you've ever raised it with the federal minister and if you know of any initiatives federally or on the part of your department, to look into why this discrepancy exists?

MR. D'ENTREMENT: Well I do recall the letter that you sent back in September, and that issue had come up on a number of occasions on a couple of conference calls that we had with the federal minister. The federal minister at the time sort of wanted to take the lead on that one. I know he had a number of meetings with the slaughterhouses and the bigger companies. But I think it's also been escalated to more of a Competition Bureau issue, and I know that the federal government has been pushing that one forward.

MR. MACDONELL: So, it's a Competition Bureau issue. Can you tell me why they think that, or why it falls there?

MR. D'ENTREMONT: I think they felt that there was a bit of price fixing going on, especially in the companies out west and a couple, I think, in Ontario. All in all, I think it was definitely a discrepancy and that was brought up by many members, whether it be ministers and other MLAs that brought that issue to me as well. That discussion is still ongoing as far as I understand by the federal minister.

MR. MACDONELL: The Competition Bureau is looking into it?

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MR. D'ENTREMONT: As far as I understand from the last conversation with the federal Minister of Agriculture.

MR. MACDONELL: Would you mind confirming that for me?

MR. D'ENTREMONT: Sure.

MR. MACDONELL: I want to touch briefly - I know the department had offered some help to sheep producers, I think it was support for calls and for animals that were retained and I think maybe up to 8 per cent of the flock, if my memory is correct. But it seems to me, that there was some other monies that were supposed to be available, at least the sheep producers were of the impression that it was. It was like if the cattle producers don't use it all up, there will be some money available for you. Am I right on that? My interpretation of a program for support for sheep producers?

MR. D'ENTREMONT: Well there were a couple of conversations that had happened with sheep producers a little while back. The mandate from the BSE Task Force was straightly derived for cattle as well as my directive from Cabinet. I think in the conversations that we had, we did discuss the possibility of looking at that should Cabinet give me that approval. At this point, we really haven't gone on with that issue. I know we're still watching our budget line, but our budget line is getting pretty much filled up there, so I don't know what amount of money I'm going to have left in that program.

MR. MACDONELL: Okay, so what you're saying is there really was no assurance given to sheep producers that there would be . . .

MR. D'ENTREMONT: No, I think it's something we could look into should there be some money left over but as it stands right now, there will be no surplus within that funding.

MR. MACDONELL: How much money was there in that fund?

MR. D'ENTREMONT: Originally $3.5 million, where $2.5 million was supposed to go towards the $100 sign-up for cattle. Then there was $1 million left over for the BSE Recovery Program. What we were doing was watching that to see where we would end up and if we would have some cash left over then we would move on to that discussion with sheep producers. Unfortunately, the money has been used up.

MR. MACDONELL: That's more as a result of Cabinet's decision, that's how they wanted the funds allocated?

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MR. D'ENTREMONT: That's right. It was originally from the task force, the task force had the recommendation pointing directly at the cattle producers and we did take that recommendation to Cabinet, and Cabinet gave that approval to focus on the cattle producers.

MR. MACDONELL: I know comparing the sheep industry to the cattle industry, it's not particularly large in this province. The sheep actually get caught up in this BSE net because the border closure applied to all ruminants even though there hasn't been BSE found in the sheep. So it would have been actually, I think, very appropriate to set a little bit aside for them since the problem wasn't created by them, or certainly wasn't created by ovines - if there's some room for any flexibility there. To your knowledge is all the money gone?

MR. D'ENTREMONT: Our indication is right now, the money will be gone from the commitments that we have in place now with the actual applications that we have through the system, that the monies will be gone. I do want to point out one thing, the federally announced Transitional Income Support Program, that was $4.4 million for, basically the Nova Scotia ruminants sector and livestock sector in Nova Scotia. It sort of adapts, the sheep did fall under that federal program. So there was some funding to go through that program. It doesn't necessarily hit the issue of hitting my $3.5 million high but it was taken up by the federal program.

MR. MACDONELL: I can only say, thank God for federal programs in this province.

I want to comment, this can be brief, I didn't bring a copy of the letter you just have given me a few days ago regarding those individuals who had indicated to me that they somehow had missed the original BSE Recovery Program list. I want to say that I expected that they or I were on a list somewhere, but your letter didn't really explain why they didn't receive anything. It just said they were on the list and they should have. I was curious what list you use. You said it wasn't the Federation of Agriculture.

MR. D'ENTREMONT: We did use the farm registry information. You, as a farmer, sign up every year to be a registered farmer, and we did use that list to send out the information.

MR. MACDONELL: So it only would have been registered farmers that even could have been notified? I'll give them copies of the letter you gave me, I don't think it will explain to them why they didn't receive it. Especially when the presidents of the Canadian sheep producers and the provincial sheep producers are people who didn't get it, but anyway.

I want to ask a couple of questions around AgraPoint International. Is it my understanding that you're still the only shareholder?

MR. D'ENTREMONT: That's right.

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MR. MACDONELL: They will receive their $2.2 million in this budget?

MR. D'ENTREMONT: That's right.

MR. MACDONELL: Where would I find that as a line item?

MR. D'ENTREMONT: You want to look at the Supplementary Detail, Page 3.4.

MR. MACDONELL: Okay.

MR. D'ENTREMONT: Under Agriculture Services Administrations, there's an estimated number of $4,115.6 million, in that number would include the $2.2 million for AgraPoint.

MR. MACDONELL: Can you tell me - I see that AgraPoint is listed under Agencies in the Public Accounts booklet. Can you tell me the reason for - I guess my thought has always been it was a Crown Corporation, but I see that it's regarded as an agency. I think January 2003, Peter Clarke for AgraPoint came before the Resources Committee and he said that they were a Crown Corporation. I think I do have a copy of that transcript. So, obviously, he wasn't right. Can you tell me what's the difference in the set-up, between doing this as a corporation or as an agency?

MR. D'ENTREMONT: I think that back in 2002 when it was set up, it was set up as a limited company rather than a Crown Corporation. To give more info on that one, a quick background that we have on the company would be that AgraPoint was established as a result of the Government of Nova Scotia's decision in the Spring 2000 Budget to restructure the funding delivery of production services with the province's agriculture industry. The government downsized regional offices and eliminated all production specialists. In doing so it provided $2.2 million to industry to direct and develop the services it required to meet its needs. AgraPoint is an incorporated business that operates at arm's-length from government and has the ability to generate revenues.

MR. MACDONELL: Okay, so you're saying it was created as a limited company. Is that a usual thing for them to be listed under Government Agencies? Why is it listed as a government agency if it's a limited company?

MR. D'ENTREMONT: I can't answer that. I would like to get the information for you.

MR. MACDONELL: I think that would be worthwhile.

MR. D'ENTREMONT: Was that in that most recent listing of Government Agencies and . . .

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MR. MACDONELL: I think I have it here. Public Accounts, Volume II Agencies Funds for the Fiscal Year 2002-03. So I'm assuming that's the most recent because that came with this pile of documents and in the Table of Contents, it's Page 6. It's the second under the Table of Contents and that brings me to another question. If you look on Page 10 of that booklet (Interruptions)

[3:45 p.m.]

Anyway, I'll ask the question and maybe you'll have an answer before the booklet comes back. On Page 10, at the bottom of the page, it says Government Assistance - this is with regard to AgraPoint International - Government Assistance Related to Capital Assets and Other Assets is deferred and amortized to earnings on the same basis as the related asset. So my question is, is there any other government assistance other than the $2.2 million that you know of? I was curious about that line, the way it reads.

MR. D'ENTREMONT: According to my office, there is no other funding that goes to AgraPoint outside of that $2.2 million. But I think if there's a particular project they will be able to access other funds through other departments, on particular projects. I think it gives them the opportunity to do that if necessary. They do have the power to generate.

MR. MACDONELL: I know that. I know that they have the power to generate funds. I was just thinking, $2.2 million is a pretty significant amount to work with and I'm just curious as to the fact that they might access other public money on top of that.

MR. D'ENTREMONT: I'll try to see if I can get you a really good answer on that one to sort of resolve that issue.

MR. MACDONELL: That'll be great. I guess I only have one more question with this regard - is it possible for you as the only shareholder and the fact that the province, and this is a Crown agency, to get an itemized price list of fees charged for what services and whatever?

MR. D'ENTREMONT: Yes, we'll get all that information together. Our relationship with AgraPoint has tended to be a good one. There are a number of issues within the industry pertaining to AgraPoint and that is one of the issues, that core list of items. We're trying to put that together.

MR. MACDONELL: Do you want to take a look at that, Mr. Graham? Page 10 is at the bottom of the page, Government Assistance.

MR. D'ENTREMONT: We'll get a clarification on that.

[Page 15]

MR. MACDONELL: I would certainly like some type of clarification as to the fact that it's a Crown Agency and a limited company. There seems to be a disconnect there, I think.

Recently, I believe last Tuesday, Pork Nova Scotia was before the Resources Committee. They had indicated a couple of things - one is the sow project and I might be calling it by the wrong name, but I think they wanted to establish farmers interested in forming a co-operative to build a facility that would house a certain number of sows and they could create some efficiencies by doing that. Then the weaners would go out to individual farms and they would raise them. So it was kind of taking a farrow to finish idea and consolidating, at least the farrowing part of it. To date, that seems to really not gone very far as far as getting support from the government on that. I'm curious about your thoughts on that, why is the province not supportive of it or supporting and helping them out in that regard?

MR. D'ENTREMONT: That has been brought forward in a couple of conversations that I have had with Pork Nova Scotia, but I don't recall an actual ask of the total amount that they were looking for. Now, I don't know if there's an actual request to government for that funding. I know it's been a discussion topic on a number of occasions, but I haven't actually seen a request to government for that.

MR. MACDONELL: Then, if it's been an actual topic on a number of occasions for discussion, what was the message you were sending them? We haven't seen an actual request or we don't really like the idea?

MR. D'ENTREMONT: I think a lot of things got mixed up together when we started talking with Pork Nova Scotia. Prices were depressed at that time, we were looking at some kind of vehicle in order to provide monies to them and it turned out to be the loan program that we went forward with. So I think that issue did go back and go to the back burner in our discussions.

The other issue was to make sure the whole industry, or at least a good core amount was onside with the whole issue of that farrowing facility. I think we all thought it was a decent idea and how to strategically change the industry so that it will be able to survive into the long term. We're still waiting to work on that strategic plan with them. We do have a meeting set up in May to work towards it. They're supposed to be coming back with some more information on that strategic plan, and I'm sure that topic will be in it.

MR. MACDONELL: Two things - how did you intend to have discussion to find out, or do you seem to think that the whole industry is not onside on this or there may be some indication of that, although I was thinking if Pork Nova Scotia made the presentation, they kind of speak for the whole industry. The other thing, wasn't there a task force? Didn't the pork producers participate in a task force with the department last Spring? You weren't there,

[Page 16]

but I thought that was one of the recommendations of that report. So, it seems to me there's been a study done last Spring and I think their concern is that I think their task force report is sitting gathering dust.

MR. D'ENTREMONT: As for the study, and I do apologize for not knowing about it, but I'm sure the discussion will start to pick up as we start to go forward now that prices seem to be better. I can get more information on that one too if you'd like. It's an issue that was on the table and I'd like to bring that one forward. I started getting ruminations behind me that there was a document produced and I'd like to see a copy of that as well.

MR. MACDONELL: I would appreciate anything you could tell me. It seems that, I think they've made a pretty good case. I can see the government's reluctance in a bit of a downturn, but I think the industry was going on the notion that they have to try to stabilize the industry in a way that they're not always coming back to government for help every couple of years. I think this was a major step in what they were seeing as a possibility for doing that. Anything you could get me . . .

The other point I wanted to raise that they suggested, I'm just going to bounce this off you and see what you think, but they were looking at wanting to impose a 10 per cent per kilo - the only term I can think of is levy, but there might be a different word - for every kilo of pork retailed. That would go back to hog producers. Their thoughts were that this would have to be legislated, so I think the basis on this is that they could be more competitive if that were the case - and their grain costs is a big problem - but, also the fact they believe that within the price structure, the present retail price, there is enough for producers as well as processors and retailers. I think they indicated a 300 per cent increase from what they get for hogs compared to what's sold in the display case. So they think some of that could actually go to them without raising the price to consumers. I just wondered - you're probably aware and what are your thoughts on that?

MR. D'ENTREMONT: Not that long ago, we set up a pork round table and what we tried to do was bring together the farmers, Larsens and Maple Leaf as well as the retailers. We did have frank discussions of what the farmers thought was at the end of the day and what the retailers thought. So I think that's turned into a really good discussion vehicle, I know there were a couple of commitments on behalf of Sobeys to give some of our pork producers. It is something that we've said we want to do quarterly, we want to sit down every couple of months and discuss this issue. The 10 per cent levy was something that was discussed at that table, but we didn't really get a clear feeling of how that would work when it comes to the retail end, and if there is really that kind of markup at the end of the day.

I think if you sit everybody at the table everybody says they don't make any money, but I think at the end of the day we can sit down and try to eke out that existence. I think it was one of the first times that that whole group had sat down at one table and discussed those common issues and was, I think, something that was very productive and as I said, there were

[Page 17]

a couple of commitments that did come out from that meeting and I'm looking forward to the next meeting of that one.

MR. MACDONELL: I know what those discussions are like, I think when we go to governments, quite often we don't have any money. I want to touch, just briefly and then I want to come back to BSE. It looks to me that agricultural services have been cut in this budget, and certainly programs and risk management I think have been cut by more than $1 million. Your forecast last year, was I think $11,197,400 and they spent about $3 million more. I don't know if that was the difference in the $3.5 million, but you are budgeting less, you're budgeting $10 million, just slightly over $10 million. In a time that some form of a risk management program seems to have been so important and we're not really out of the woods yet with regard to both pork and beef. Am I reading it right? Is there a reduction in funding there, and why?

MR. D'ENTREMONT: Mr. Chairman, thank you. You will see if you look at estimate to estimate there is a decrease of just about $1 million. Last year there was a prepay done. Because this is a five-year plan, in order to pay for some of the things that we did last year we actually prepaid it from last year. So, it is showing $1 million down this year. If you look at the $14 million forecast incorporates that $3.5 million for BSE that we did add and that's the line item that it gets put under.

MR. MACDONELL: Well, I have to say, it's this prepaying, for those of us who don't work in the Department of Finance, it's really hard to trace money that is booked for spending ahead or whatever. It makes it difficult to really get a handle on what the government is doing. What about Marketing Services, a $77,000 increase this year and they promote Nova Scotia grown products? It seems that in light of all that we've heard around trying to get the province to put more Nova Scotia products into its institutions, et cetera, that this doesn't seem like a lot. I'd like you to touch on the ability of Nova Scotians to access institutions with our own products.

[4:00 p.m.]

I heard a conflicting statement by the Premier, that he wanted to go down this road, and then I thought I had heard that he said it wasn't possible. So, I'm curious as to where you are with that.

MR. D'ENTREMONT: Ultimately, the whole Brand Nova Scotia - there are basically two programs going on at the same time, the bigger Brand Nova Scotia program which incorporates food products, incorporates tourism, incorporates a whole plethora of other products on a more global scale, basically falls under the jurisdiction of economic development, within that, as the piece of agriculture and agri-food products. Our department is working toward more of getting our products into Nova Scotia institutions.

[Page 18]

When you referenced what the Premier was talking about, that some of these things can't happen as quickly as we can possibly do them, that had to do with the federal inspection requirements to get some of these meat products into Nova Scotia institutions such as hospitals, in order for hospitals to keep their certifications under their Canadian guidelines or regulations that that falls under there. In order for them to maintain that, they need to have Canadian inspected products. Because we don't have a Canadian inspected facility there's going to be a lag time before we will be able to provide Nova Scotia products.

Our saving grace, really, is the new plant that is going up in Borden, on P.E.I. which will be a Canadian federally inspected slaughterhouse which will be able to run meat from Nova Scotia through that system and get it back here to get into our institutions. Our assurance right now from the conversations that the Premier has had with Premier Binns is that that should be fully on-line by September. We should be able to see a change in that by September.

MR. MACDONELL: Well I'm curious as to why - I can see in a federal institution, like maybe the DND base, National Defence, but on provincial institutions, hospitals, et cetera, why would we need federal inspection for those? Why can't we use provincial inspection for products which are not leaving the province?

MR. D'ENTREMONT: Apparently the certification that they do have is a federal certification that hospitals must adhere to in order to be a hospital and apparently that's where that falls in place, their meat and meat products would have to be Canadian inspected in order to maintain that federal designation as a health care facility. I don't know the exact terminology as I said, hospitals tend to be slightly federally regulated in order to keep those certifications they must have that kind of product.

MR. MACDONELL: That's a wrinkle I never heard tell of. Anything that you could get me in that regard, I would appreciate it.

I was to a Cattlemen's Association meeting in Pictou a week or 10 days ago and one of the producers from the Antigonish area, I think he is right on the border of Antigonish and Pictou. Fraser Hunter made a presentation to those producers there and he had talked about going on a government Web site and looking at some procurement requests - which I'm hoping to be able to get from him if I do, I'll try to present it to you. Anyway, the indication was around health facilities, hospitals I think in the Capital District here. One of the requests was for New Zealand beef, so many pounds or whatever of New Zealand beef. I'm just curious, does that make any sense to you, in a time of a BSE crisis, that we would be looking for New Zealand beef to provide to Nova Scotians?

MR. D'ENTREMONT: Ultimately we would have to look at the procurement policies that we do have in place by those institutions. Does it make sense? Not really, I think what we see are the supplementary imports that do come into this country, it's not just a Nova

[Page 19]

Scotia phenomenon that we do have some of this back-selling of products from other countries. I fail to see why it would have been specified New Zealand beef. If you can find that document, I would appreciate seeing it and I will ask the question as well on my side.

MR. MACDONELL: When I get it, and I was told I was going to get it, I'll see that you have a look at it, I'm as curious as anybody, and it would seem to me that it would be something that the institution itself had made the request. I guess the other issue is around the BSE. You would be aware that two of your colleagues and myself and the member for Annapolis, who is the Liberal Agriculture Critic, we were to Washington early in March and my impression from that meeting, and certainly from the Undersecretary of Agriculture there, I think his name is Dr. Lambert. The comment period was going to end April 7^th, that they would look at the information that had come in during that period, and hopefully come up with a ruling by June. I'm wondering what context you have or what the people you're talking with, what indications they're giving you around the whole border opening issue.

MR. D'ENTREMONT: We had the opportunity to go to Washington just ahead of you guys, by about a month. It was the Ministers of Agriculture from across the country who went down to see the Commissioners of Agricultures from all the states. During that conference going on we had the opportunity to present our feelings of BSE and opening the border. We were third on the schedule. The first guy to get on was a Dr. DeHaven, who has been the veterinary pathologist who has been in the lead on the Washington case of BSE. He had the presentation to the folks first.

The second person was a Mr. Acord, the Undersecretary of Agriculture for USDA. They basically stole our speech. They were talking all the things we were talking, the opening of the border, the harmonization of regulations when it comes to ruminant feed, testing, et cetera. We as the third group, got up and made that presentation, and reinforces exactly what those folks had said. The questions that we did get from the Commissioners of Agriculture tended to be sometimes protectionist, sometimes, lets open up because we are integrated.

That was our message, an integrated system, it's an integrated market, North American beef should be branded as such, not necessarily just Canada beef and U.S. beef. If you really trace some of these things, you will see some of these calves born in the States and grown in Canada and vice versa. We did have a nice long discussion with them. We did have a meeting the next day with the Undersecretary as well and we did talk about the comment period, it had just opened and we were both going to have that closing on that April date. Our feeling, that's amongst all of the ministers across Canada that June, we should have a positive announcement from the U.S. to open up to live cattle in under 30 months.

We did have on Friday, an opening of the border, another restriction taken off, which was the access of bone meat being allowed into the U.S. for animals under 30 months as well. These are all tending to be positive steps. The fingers are crossed, my toes are crossed that

[Page 20]

at the end of the day the border will open and then we have a chance to start working towards normal, which still will take some time.

MR. MACDONELL: I agree, I want to say that I hope someone is thinking of the people who were in the other ruminant sector who were kind of caught up in this. You may or may not be aware that this year in Quebec is the World Sheep and Wool Congress for sheep producers. That entails a show and a sale and not to mention speakers on a variety of issues. The international flavour of this kind of disappeared with the closing of the border because nobody can take any animals out of the country. As for me, I'm sending four animals to this sale. I kind of hope at some point, to try to access the New England area farmers for breeding stock for Suffolk sheep, but certainly it is worth my while even in terms of Quebec, and that area to try to show a presence for that market.

This is just one small thing really that has been impacted by the inability to open the border and I would say if the border opens in June, you're not going to see much of a difference, it's going to be too late for the sale, and as far as I know, this is the first time it has been held in Canada. It hit at the wrong time for sheep producers in the country. I'm trying to watch my time, because I'm going to hand off to my colleague and my Fisheries Critic.

I want to touch on Avian flu. Before I go there, I want to say I got my notice the other day around the ILT vaccinations. My kids show some birds for 4-H. It's not clear to me, and if someone can clarify this for me today I'd really appreciate it. When I look at the instructions it said birds under three weeks of age will not be vaccinated. I have an incubator, I have birds going to hatch and I've never known for sure what actually happens - there is a quarantine period of 30 days once you vaccinate, so here I have birds hatching after I've had birds vaccinated.

I know in the case of my neighbours down the road who bought some chicks after they had theirs vaccinated and indicated on the form when they applied to get them vaccinated that they were going to get these chicks this day, what was the protocol and they never got a response. Then the department came and euthanized the chicks which you can say they didn't appreciate, especially when they were trying to get information. I'm one of those people who would like to know what my role is in this regard, whether I should move the birds that I have vaccinated off my property or move any birds that hatch later off my property, and just how the department looks at this. You can give this to me whenever, you don't have to respond, unless you know.

MR. D'ENTREMONT: It's a very good question, but I'll have George Smith give you a call to give you the ins and outs, there's a lot of regulations around that one.

MR. MACDONELL: Is his signature on the letter?

[Page 21]

MR. D'ENTREMONT: Absolutely, I'll get George to call you.

MR. MACDONELL: The other thing is around Avian flu. When I was - my colleagues we went to Washington, but we spent a day or so in Maryland. The southern part of Maryland I understand was experiencing Avian flu. Whether it's the same as the one in Asia that is particularly of concern, or the one in British Columbia, I don't know, but I thought that we are closer to Maryland than we are to B.C. Along with the implications I would have concerns around what the impacts might be for Nova Scotia's poultry industry.

I also have a concern around the implications for me, I have a flock of domestic water fowl, some heritage breeds of poultry: Barred Plymouth Rocks, Golden Laced Wyandottes, Broad-breasted Bronze Turkeys. The whole works wrapped up wouldn't amount to a big pile of dollars. They are what they are. I like what I do when I'm not in the Legislature and not to say that I don't like what I do when I'm in the Legislature. This little bit of farming I do is a good thing for me and I think good for my children. I would hate to find out for whatever reason, an outbreak of Avian flu or whatever, that there is, I'd be part of a quarantine area that would mean the elimination of these birds.

In both those regards for the larger industry and for little backyard poultry enthusiasts like myself, I just wonder what you know about the B.C. situation or Maryland and what steps if any that the government looks at in trying to prevent such a thing in this province?

MR. D'ENTREMONT: We've been monitoring the outbreak in B.C. very closely. Our department has a veterinarian, Dr. Gord Finley, participating in the CFIA conversations that happen pretty much every day. He's also on the list for all the information that flows from CFIA to all the provinces. We have sent out a couple of letters to our producers in the province, just telling them to be very careful in what they do and to upgrade their bio-security where possible, and to really keep an eye on it.

The feeling is that the outbreak in B.C. will pretty much stay in B.C., which we hope. We also need to look at how their industry is run, their industry, 92 per cent of all their industry is in the Fraser Valley, where our industry tends to be spread across the province. The concentration of birds is definitely a lot less than what they would be in B.C. But ultimately the CFIA does take the lead on these issues. They monitor it quite closely, but we're definitely working closely with our feather boards to make sure they're doing all they can do to ensure this doesn't happen. But, as for the particulars of who would be in quarantine and who would be out of quarantine, I'm not too sure at this point.

[4:15 p.m.]

MR. MACDONELL: I appreciate that. Before I hand off to my colleague, when I asked the question around the procurement in the New Zealand beef, I saw one of the staff bring a note and I just wondered if it related to that? Okay.

[Page 22]

With that, I say thank you to you and your staff. I really appreciate your time and if you could give me a response on those issues I raised and I'll turn it over to my colleague, the honourable member for Pictou West.

MR. D'ENTREMONT: If I may make one comment with regard to your first question with regard to the Acadian flag. I'll ensure that all members of this House have a flag to take home, an Acadian flag, because of this l'année l'Acadie.

MR. MACDONELL: I need to give mine to somebody so if you could give me two?

MR. D'ENTREMONT: Now we're getting on.

MR. CHAIRMAN: The honourable member for Pictou West. You have approximately 15 minutes.

MR. CHARLES PARKER: I'm glad to hear that about the Acadian flag, I was going to suggest that maybe all members should have one to put up in their offices or on their street front or whatever. This being the year of the Acadian celebrations, 400 years, a great idea, glad to hear it.

Most of my questions are going to be around the fisheries. Maybe I'll mention a little bit on agriculture before I come to that. As my colleague had mentioned here, he and I had attended a meeting of the Pictou County Cattlemen's Association recently and there's still a lot of concern out there around the BSE issue and the whole state of the beef industry in our province. It's good to see producers are coming together to share their common concerns, but I think they're still looking for answers, still wondering if they're going to survive this crisis. Really, that's what it's been for almost a year now since the BSE cow was discovered in Alberta.

It's been tough. I've talked to some of the producers who are struggling financially, they're having a hard time. They're starting to talk more and more about local markets as being an answer to getting out of this crisis. In a nutshell, is there any message you could give to them that would offer them some hope that things are going to get better for them?

MR. D'ENTREMONT: As I said to the previous speaker, the honourable member there, is that we are thinking positively that the border will open in June. We're on the back side of the whole industry, where we are cow calves - we produce the calves to fill in the feed lots in other provinces, for the most part. When they're not selling their animals, we're not selling our animals so we're starting to get a bit of a backup of our inventory. If you look at what a farmer was feeding prior to the Spring, sometime in the Fall, they would have had one number, but they would have bred some of these animals as well. Now we have a bigger inventory than what we had.

[Page 23]

The positive thing is, consumer confidence in beef in Canada is at an all-time high. Canadians are eating more beef than they ever had before. The local issue is a really good one - we do have 20 provincially-inspected plants in Nova Scotia that are increasing their production levels. Every time you talk to them they're doing a couple of extra cows. There's one down in Annapolis provincially inspected that is trying to add to their production levels. These are some of the good-news stories that are happening here.

We do need to start talking a little bit about local use. Right now we only produce somewhere close to 7 per cent of our total consumption in Nova Scotia. There is definitely an opportunity here for us to try to fill in some of that gap. How that's going to transpire over the next bit remains to be seen. The federally-inspected plant coming on-line in Borden, P.E.I. in September is good news and I urge all producers to use that, those who are finishing cattle. On the other side, it is in P.E.I., that's where we sell the majority of our calves, so hopefully we'll see quite a bit of change in the way that industry is working.

There are a number of other issues that surround it, but I'll try to keep my comments short.

MR. PARKER: Opportunity maybe is the key word. Producers are maybe looking for some help from government to offer hope that there is some opportunity for them to come out of this and to thrive and survive in the future.

I'm going to move on to fisheries because I know my time is quite limited. First of all, in your whole Department of Agriculture and Fisheries, your total budget amount is roughly $40.8 million. Of that, what portion is for agriculture and what portion for fisheries?

MR. D'ENTREMONT: It's difficult at this point to pull everything up because if you look at Marketing Services, part of that's aimed at the fisheries sector. You have Fisheries and Aquaculture Services is $3.4 million. Part of the marketing services - I would say the licensing piece and licensing compliance piece would all be based at fish. I could get that number for you, what the actual breakdown is. I think if you look at the whole business risk management of agriculture, they would have more money invested on that side than we do have on the operational side of what we do for fisheries.

MR. PARKER: Maybe 75/25 in favour of agriculture or possibly it's more heavily weighted towards agriculture, I know. I guess one of the concerns that I've heard from fishermen, I've certainly heard it from farmers - I know this is not something you can address in your budget estimates, but nonetheless, those producers would certainly like to see a separate Department of Agriculture and a separate Department of Fisheries. That's the way it was up until 1999 when Fisheries and Agriculture and I believe Natural Resources too were all combined under the same minister at that time. Since then it's separated, Fisheries and Agriculture still being together.

[Page 24]

At any rate, I'd like to get your thoughts on that - whether you feel it would be a benefit to the industry, both the fisheries industry and the farming industry to have a separate department for each?

MR. D'ENTREMONT: If you look at the way the department is structured - I did have a bit of a structure speech there, but I did take it out, but I did table it, you might want to look at it. If you look at the shared services that do happen - we share our minister and deputy minister, Marketing Services, some of the compliance and legislation pieces. After that, they are two completely separate departments. When you really look at how they're structured and the people that work with them, we do have two separate assistant deputy ministers at their mandate. One is to work exclusively with the fisheries sector and the other one is to work exclusively with the agriculture sector.

Some of the things that we do are very similar because it's food and food safety, legislation and compliance and the rest of it; they are working separately, just the name is together.

MR. PARKER: It may be a perception as much as anything, but the fishermen I've talked to would very much like to have their own separate department, their own separate minister and so too would farm producers like to see it separated.

I guess because I'm under a limited time here, I come around to the question in my county, Pictou County, that's of concern to fishermen and fishing families right now and that's the situation with Polar Foods and the distribution of the assets from that disaster that happened in the industry on Prince Edward Island. The Arisaig and the Lismore plants have been basically closed down for production, at least for producing lobster product and so I have a couple of specific questions on that point. I think I'd asked you this in the House, but around the sale of Polar on P.E.I., my understanding is that any lobsters that are caught here in Nova Scotia that were normally going to Arisaig and Lismore now must be shipped and processed on Prince Edward Island. Is that a contravention of the interprovincial agreement on trade? What can we do about it?

MR. D'ENTREMONT: . . . I'll table the letter, I meant to give it to you sooner. Here are the questions that we did ask the Government of P.E.I. in the whole agreement with the new company. Number one, are there government-imposed conditions that require Ocean Choice to process Nova Scotia landed lobster, at the remaining Polar Foods plant in P.E.I.? Number two, are there government-imposed restrictions on the operation of the Lismore plant? Three, are there government-imposed restrictions on the sale of the Lismore plant? We did receive a reply today. We are still researching the information that's held within it, but it looks like there are some definitely questionable things that we do want to move to Intergovernmental Affairs to look at this further.

[Page 25]

MR. PARKER: That's good to hear. The concern is that, how can another province step in and say that our resource, our lobsters, can be taken out of province and have to be processed in their province and certainly as a department and as a government, we should have a say in that, rather than them dictating what can be done here on our shores. So you're still looking at that response in determining what your response will be then?

MR. D'ENTREMONT: Exactly.

MR. PARKER: I guess the other part of my question in relation to that is, Ocean Choice now has purchased those plants and they, I guess, are not interested in processing there. Is there any possibility that, with the department's help, those plants could be sold to another operator that could then process right there as it has been for decades? I'm not sure.

MR. D'ENTREMONT: I think if we look at the processing capability across Nova Scotia, that's an important plant in that area and I think it's our intention to ensure that it maintains some kind of production. I would hope to see more production than what it is doing today, if at all possible. There are a number of companies that are looking at that asset and seeing what the answer is going to be from the provincial government when it pertains to the whole agreement with Polar Foods, to see if that might go up for sale again. Ultimately, we're following that one very closely and we would definitely be there to help anybody who would like to use that facility, should it come up for sale.

MR. PARKER: There are certainly other processors out there that are quite capable. The workforce is very experienced, and certainly knows how to process lobster and other fish. It would be a shame to lose that resource from the northern part of our province. Failing that though, I know there are other fish plants in the area not too far away. There's the Caribou plant, North Nova I believe it's called. There's Cape John Seafoods, and there are others. So it would be important, I guess, to encourage some method for those workers to be able to relocate, failing an operation up and running there in Arisaig or Lismore, and if not, I guess the third option is, is there going to be any assistance to the workers, the 140 workers that may be out of a job if neither of those first two options come through? How can you best help those workers?

MR. D'ENTREMONT: Ultimately, we are working with the Office of Economic Development at this point, to look at other opportunities in the area, to ensure that there will be some work for those workers, but ultimately, my feeling is to make sure that plant goes back into production as it was prior, if not, into more production.

MR. PARKER: How much time do I have left, Mr. Chairman?

MR. CHAIRMAN: Your time has expired.

[Page 26]

MR. PARKER: My time has expired. I have some other questions that I'll come back to when our turn comes around again. Thank you.

[4:30 p.m.]

MR. CHAIRMAN: We'll now pass off to the Liberal Party.

The honourable member for Annapolis.

MR. STEPHEN MCNEIL: Mr. Chairman, I, too, may also share my time with my colleague, the member for Digby-Annapolis. I won't say the best news I heard all day, but probably close to it was the Acadian flag. My mother would appreciate the Acadian flag - Mombourquette is a good Acadian name (Interruption) I will thank you. The only comment that I would have before I start, being new, the minister to the Legislature, and maybe this has been the case all along, I don't know. I think you're sitting on a golden opportunity as Minister of Agriculture and Fisheries to highlight the importance of the agriculture industry in Nova Scotia, not just because you're the minister. My experience with the member for Hants East, who has been very dedicated to the agriculture industry and it was a pleasure to be in Washington with him with his knowledge around the agriculture industry, to be able to talk to the American Government, to deal with. I think this department could lead the way for government in showing co-operation amongst the three Parties, because if you listen to all of us, we're all saying the same thing. The winner would be the agriculture industry and the rural economy of Nova Scotia.

Having said that, now the niceties are over with, I just want to go back to your opening comment when you spoke about the amount of money that was in the BSE program, $12 million I think you quoted for Nova Scotia. You made reference to the fact that it was in accordance to what the BSE Task Force had asked for. How much of that $12 million is provincial money?

MR. D'ENTREMONT: All right, I'm going to give you a quick rundown. Sometimes it's hard to see what was the provincial contribution and what's the federal contribution, but let me give you a quick rundown. Nova Scotia beef producers enrolment program which was our CAIS sign-up, right now there's $2.336 million. The provincial modified BSE Recovery Program, that's the one we funded completely, $646,413. The Canada-Nova Scotia ruminant cull program, now that says $1,815,026, what part of that? That was a 60/40, so (Interruption)

MR. MCNEIL: Could we say out of the $12 million, half?

MR. D'ENTREMONT: Yes, somewhere near that.

[Page 27]

MR. MCNEIL: That's fair enough, around half, yes. The reason is you go back and you say, and I guess this is a little bit of a burr in my saddle, when you say we met what the task force had asked for, and I'll read you the two recommendations. The recommendations were, provide immediate funding of $400 for breeding aged cows, which we had figured approximately would be about $10 million, and re-establish a Nova Scotia BSE Recovery Program, the key word there is Nova Scotia, which was modeled after the previous program, which we estimated to be about $1 million roughly, okay. The key thing was, out of the original one, that money would be directly into the hands of producers. There is no way that you can tell me, out of that $12 million you spent, that anywhere near that, got to the hands of the producers? It's been eaten up somewhere along the way and I don't know where, but long before it . . .

MR. D'ENTREMONT: All that money that we have listed off here has gone out in cheques to producers. Now, I do take your point, but all these are direct payments to producers.

MR. MCNEIL: All $12 million has been a direct payment to the farmers?

MR. D'ENTREMONT: Correct. Except for that CAIS Program where we had the estimated second payment for 2004-05, so that's a 50 per cent holdback, which is about $800,000, which hasn't gone to the producers just yet, or should soon be going out to them.

MR. MCNEIL: This really highlights the biggest issue - you've mentioned it - the Nova Scotia Federation of Agriculture's annual meeting and as well, the disconnect between the producer and this department. I can't find a producer out there who would tell me that their industry got $10 million. I can't find one that's going to tell me they received $9 million. Not to belabour that point too long, but there's some disconnect here on whose numbers are right. The other thing that wasn't a recommendation which we talked about on the bottom, there was a suggestion that there be an industry-government BSE advisory group created to examine the long-term impact because we really were only able to deal with the short term. Has there been any movement on that? Has there been anything done with that?

MR. D'ENTREMONT: No, not as of this point.

MR. MCNEIL: Okay. Thank you very much. You had mentioned also in the beginning of the estimate, I believe it was in 2003, sorry on Page 3.2 of the Estimates Book. I will try not to be confusing in my questions, but I probably will be. In 2003 your estimate was $40.118 million when the actual was $42.5 million. This year you've estimated $47 million. Why are we going, I guess, with the estimate of 2003-04 and not the actual or forecasted? Why isn't that the base point here? It seems like your base point is your estimate of the previous year.

[Page 28]

MR. D'ENTREMONT: In Generally Accepted Accounting Principles we do go from estimate to estimate and put in what we would think would be relative in order to take the pressures in that we have. The forecast that you see is, of course, the $3.5 million that we did put together for BSE, that would be a one-time payment. I don't think there was a request for an ongoing contribution in that case. So according to the accounting principles that we must adhere to, we just inflated as the cost of doing business.

MR. MCNEIL: But pre-BSE, we haven't even estimated the actual of 2002-03. We're not even at that target yet and the actual budget in 2002-03 was $41.44 million. That's the actual we're now at, you know, and that's pre-BSE.

MR. D'ENTREMONT: Yes, there was a one-time payment. If you go back to deal with 2002-03 in the estimate where it was, I think we're looking at agricultural services of $15 million and then we went on actual of $20 million. I think that has an increase of x amount because of flood and then the prepayment for the risk management, the APF. So that's why it shows, but ultimately from estimate to estimate to estimate you're seeing an increase in the departmental budget.

MR. MCNEIL: But from actual to estimate you're seeing a decrease. I'm not an accountant I guess, maybe that's why I need to be an accountant to deal with it.

MR. D'ENTREMONT: Well, ultimately I think every year we've had some kind of natural occurrence that we don't necessarily budget for.

MR. MCNEIL: But you can appreciate from a provincial perspective on a $6 billion budget, we're talking a surplus of $2 million and we, as a Department of Agriculture, haven't been close to the estimate or, you know, you've almost blown your entire surplus out the window last year in the Department of Agriculture and Fisheries and there doesn't seem to be any contingency, but anyway, I appreciate that. Page 3.4 in the Supplementary Detail, in Administration there's approximately a $1 million increase in your estimate. What's that for?

MR. D'ENTREMONT: If you look at the 2002-03 estimate where you had an estimate of $4.1 million and then you look at what we had estimated last year, there was a budgetary reduction in 2003-04, including a bad debt reserve adjustment for the Farm Loan Board, and now we've caught up again with it this year, back to the amount of money that's required in there, because of that finance adjustment.

MR. MCNEIL: Tell me that again.

MR. D'ENTREMONT: If you look at the estimate for 2002-03, we've got $4.1 million. If you look at the estimate for 2003-04, there is the $3.2 million.

MR. MCNEIL: Right.

[Page 29]

MR. D'ENTREMONT: Okay, that's because of a budgeted reduction and included a debt reserve adjustment from the Farm Loan Board. So it shows a little less money because of that adjustment that had to be done and we catch up again this year with the amount of money that we had invested in that, or coming close to that, from 2002-03.

MR. MCNEIL: I will ask you about the Farm Loan Board a little later, but last year the Farm Loan Board had almost a $2 million revenue, net income. How come there would be an adjustment or a $1 million loss there, a write-off?

MR. D'ENTREMONT: Apparently there was an actuarial adjustment done on that of close to $800,000.

MR. MCNEIL: Can I get some detail on that maybe a little later.

MR. D'ENTREMONT: Absolutely.

MR. MCNEIL: Great. The other issue on that same page is Programs and Risk Management. You were asked by the member for Hants East earlier, you have estimated $10 million, what's the rationale behind that, considering the numbers that I see here over the last two years, that's $2 million less than what has been required in the last two years in the actual operation of those programs.

MR. D'ENTREMONT: A lot of time we've been in transition between some old programs and some new programs so you're seeing us catching back up with the amount of monies that should be allotted under that item line. If you look at the budget, the estimate to this year's budget, yes, the decrease is about $1 million, but that also reflects last year's prepayment to the APF. The APF is a five-year plan that we can sort of take money from one spot and sometimes move it over to another within our accounting principles. The federal government apparently can move stuff anywhere they want to move it within that five years. So we sort of have to go along with them sometimes, too.

MR. MCNEIL: It's all within the APF?

MR. D'ENTREMONT: It is all within that APF and that adjustment does make sure that we do have all our money in place for our commitment for APF this year. So you're also seeing a bit of an adjustment along with that program.

MR. MCNEIL: Just staying with that whole list there of the forecast of 2003-04 that was $21.478 million and you've estimated $18 million. When you look at that cluster of expenses that you have there, if you're a member of the agricultural community, why should you feel good about that? The part of that program that they seem to be taking, you know, that is of benefit to them, which are the programs in the risk management portion, is $4 million less, but yet your estimate is $3 million, why should they feel good about that and

[Page 30]

what has been characterized by just about everybody, having gone through the worst year in the history of agriculture, why should they feel good about that?

MR. D'ENTREMONT: What they should feel good about is hopefully we won't have another BSE and ultimately that number does reflect the BSE numbers and it does show the extra money that it was able to get from Cabinet. So ultimately what we're doing is simply readjusting to our normal and should something come up, then we will have to address it at that time.

MR. MCNEIL: We talk about BSE as if it's gone. The border is not even fully opened yet, but even if the border was fully opened tomorrow, there's still going to be an issue here of pricing and all those other things that the agriculture community is going to be requiring some programs and support on. Yet there doesn't seem to be any provision in this for that. I mean if you go under the premise that $14 million is based solely on BSE, you know, BSE is not gone yet.

[4:45 p.m.]

MR. D'ENTREMONT: If you really want to look at this number, ultimately we can't budget for what-ifs, yes, the BSE situation is still ongoing, but it's also a part of our commitment to use the APF and the CAIS Program to address these issues ongoing within the industry. We have had a couple of amendments to the program right now, through the federal-provincial agreement. We are working on a third one which does talk about negative margins and prepays and some other things that will make the producers more comfortable, but the APF and the CAIS Program will be how will we be addressing business risk management into the future. That's why ultimately, we can't budget for the things that will come up, like floods, hurricanes or BSE, so we have to be realistic in the numbers that we put forward in the budget.

MR. MCNEIL: I should have asked this question earlier when we were talking about the $40 million. I'm curious, all these numbers on the page, were you told to get a budget to the Department of Finance, or did the Department of Finance say to you, here's your $40 million, make your department fit?

MR. D'ENTREMONT: Ultimately the Department of Finance and the Treasury and Policy Board gives us a target to work upon. We took that target and that target, I think, when we started, was actually lower than what we've shown here, then we went to bat and we fought and we got the number that see before us today. I think we did our work respectively and maintained the budgetary implications within this budget, but yes, we are given a target. Then we have to work it.

MR. MCNEIL: Did you make it work?

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MR. D'ENTREMONT: Absolutely.

MR. MCNEIL: Regardless of whether you can provide those programs that we're talking about that have been obviously sorely needed in the last couple of years. Just on the BSE issue in the beef industry. The check-off program that was brought out a little while ago which I know didn't pass, I guess missed by a few, locally, I just want your sense of that and how important that program may have been?

MR. D'ENTREMONT: Well, we sat down with the cattle producers, the Cattlemen's Association sometime ago when they were interested in doing this program. Ultimately it was a vote to establish the Nova Scotia cattle producers under the National Products Act, in order to charge a $2 levy per animal. Going back a little bit, the Nova Scotia Cattlemen's Association is currently designated a commodity group under the Agriculture and Marketing Act with a levy of about $2 per head, however, that Act doesn't provide for enforcement of the levy. So there is really no way to force a producer, as he's selling a head of cattle, to pay that $2.

Under the national product marketing Act, if they moved under that Act, which would require this plebiscite and all of the things that have gone prior to now in this vote, would give the enforcement piece that we're able to go and enforce that legally to make producers pay the $2 per head, as was requested by the Cattlemen's Association, in order to do the things that they want to do. There's a fair amount of marketing that they were interested in doing. There were traceability programs that they wanted to work on and they wanted the industry to be able to provide that. That's why it went along this road, and then that would set them up as a commodity group, just like Pork Nova Scotia, just like the chicken farmers of Nova Scotia, just like the dairy farmers in Nova Scotia, who are all under that Act, and are able to charge levies.

MR. MCNEIL: My understanding of this is, if this program was in place across the country in every province, it would allow us to do a levy on imported beef from outside?

MR. D'ENTREMONT: Correct.

MR. MCNEIL: This is a major issue in Nova Scotia, I mean I don't have to tell you that, but I guess now that this has failed here, what steps is your department taking to move forward on this and see what we can do?

MR. D'ENTREMONT: Right now the national products Act or the national products marketing board is looking at options, legal options. Under the Act, it says that they must have two-thirds of that vote in order to pass that rule, in order to be under the national products Act. The vote came forward, it was 64.1 per cent, so we're almost there. The majority of producers did vote in favour of this levy system, but right now we're looking at

[Page 32]

the legal ramifications of whether or not we, as the department or Executive Council through OIC is able to levy this or not.

MR. MCNEIL: Has there been any talk with producers to ask why? I mean many of the ones that I spoke to didn't recognize the fact that if this program can be put in across the country, that would allow us to put a levy on imported beef from offshore, right? I don't know of a beef producer who would be opposed to that. One of the concerns I heard was the fact that every time the animal was sold, the $2 was on it as opposed to maybe the one-time fee when it came to the slaughterhouse and you paid, whether it be $5 at that point or whatever it happens to be, you pay it the one time at the end as opposed to at the beginning. It appeared to me that a lot of the people who were voting - I shouldn't say a lot, but some of the people in my riding that spoke to me about it were voting on something - I don't think it was sold to them. I'm just curious, because by the sounds of it, you believe in it, your department believes in it . . .

MR. D'ENTREMONT: The Federation of Agriculture believes in it. The Cattlemen's Association believes in it.

MR. MCNEIL: Well, we need some leadership of the department, I think, at this point, so are you going to be moving forward to see what you can do with this at this point?

MR. D'ENTREMONT: Right now we're looking at, like I said, the legal ramifications to see what we can or cannot do. We're also waiting for a request to come from the cattlemen saying, we'd really like you to do this, or we'd really like you to do that, and at this point we haven't received that. We are still in conversation with the cattlemen, they are still going back to their membership to find out what the feeling will be, and what they can or cannot do, or what they will or will not ask for. So we're still in that negotiating phase of seeing what we can. We have to respect that, ultimately, this is their vote, for them to get under this Act.

MR. MCNEIL: I appreciate that. You mentioned earlier about the Buy Nova Scotia product. What institutions right now could we, if we wanted to tomorrow, put beef into?

MR. D'ENTREMONT: Right now, the only ones that we should be able to hit into would be through the justice system, into our jails, because there are no restrictions for federally or provincially-inspected beef.

MR. MCNEIL: I'm going to tell my young fella, if he ever gets in trouble not to worry, that the government's going to look after him. They'll feed him, but if he goes to school, they're not going to feed him.

MR. D'ENTREMONT: They'll be well fed. Right now, if you look at how the system is set up in Nova Scotia and how the regular procurement systems work for buying food, there are only a number, a small handful of companies that provide these services to these

[Page 33]

plants, or to these institutions. As part of our procurement piece, and that is held within the Office of Economic Development, they are working with supplier development and working with these companies that provide meats and foods to the institutions.

The other thing, we're looking at this as beef. How many times have you gone to the hospital and had a prime rib steak? It's not very often, so if you look at the total consumption within hospitals, it's not as great as we once thought. There is some hamburger sold there. There are some prime cuts, but I think the quantity is not there that we had originally thought. The member for Hants East had alluded to earlier, that there might be some things we're not able to do because of the actual quantity required. Ultimately, that system is a very tight system in how it operates through other companies like CISCO and previously Serca, and those companies that did provide those products to the institutions. We're trying to work with those companies as well.

MR. MCNEIL: It sounds more like it was a good Sunday morning clip than the reality of the program. In principle and the concept, it's a great idea, but the reality of it is, and the Premier should have known this at the time, it's not as simple as saying, well tomorrow now we're going to be able to fill that program. It's just not going to happen.

When you spoke earlier, you were talking about the provincial and federal inspections. Can you give me a little explanation on the differences?

MR. D'ENTREMONT: I can get back to you on that.

MR. MCNEIL: In fairness to you, maybe if you would come back to me. That would be great. I find that is a big issue. On one hand we say the product is safe and I fully believe it is safe and there's no issue and we can eat it here, but yet, if you're in Moncton you can't eat it. We can blame the federal government if we wish, but there's a real problem there, why we're going through that. Is there any talk in looking at finding a blending of those services so that the producer is dealing with one level of inspection?

MR. D'ENTREMONT: I know, I'm sure that they have been talking to my compliance division and they have had that conversation with CFIA. CFIA sets the regulations for the federally inspected plants. If you look at the requirements, some of those requirements are very capital intensive, such as bathrooms in offices for the inspectors. In a smaller plant, for example Bowlby's Meats down in your neck of the woods, if they had to conform to that, they would be adding thousands and thousands of dollars to their plants because of these requirements.

MR. MCNEIL: But the reality is, government and politicians respond to pressure and there's not a consumer in this country that would say to you that is a sensible requirement. What I'm wondering is, how much talk is going on to try to find someway to remove the lunacy out of some of that to allow one level of inspection?

[Page 34]

MR. D'ENTREMONT: I know that I've had the discussion. I know my department has had the discussion. I don't know if my deputy minister has had the opportunity yet to bring that issue up at the deputies' tables, but I know there's got to be harmonization. We talk about harmonization, regulations between the U.S. and Canada, but we do have a lot more work to do in the harmonization of regulations right across this country. It would only make sense to me that some of these things would be the same.

The guys that have the provincially inspected plants are producing a quality product, are doing it safely. We have our program vets out there making sure things are done humanely, that things are done in the correct manner. They're being done right and we definitely have some of the safest meat in the country, to be quite honest.

MR. MCNEIL: Agreed. We were talking about the federally inspected plant which is almost ready to go on P.E.I. - is it close?

MR. D'ENTREMONT: It's close. As far as we understand, they're supposed to be opening it up to do tests in May or June. So it's going to take a couple of months to get the bugs out, but ultimately, this September is supposed to be the drop-dead date.

MR. MCNEIL: Early on we were, as a province, offered a number of hooks in the plant. My understanding was initially we didn't take them up on that. Do we have a set number of hooks in that plant that guarantee Nova Scotia producers have access to that plant?

MR. D'ENTREMONT: Right now, Nova Scotia producers actually own a good pile of hooks within the plant which they will have the opportunity to run their own animals through. I did have a commitment from the P.E.I. minister that they hold a number of hooks for themselves and that we can use those hooks if we need them.

MR. MCNEIL: Many of the large producers have a number of hooks there - I guess my concern would be for the small guy. So there is some ability to run animals through that plant?

MR. D'ENTREMONT: Absolutely.

MR. MCNEIL: Great. Just to shift gears a little bit, AgraPoint. John asked the question of where it was in the estimates and it's $2.2 million, right?

MR. D'ENTREMONT: Correct.

MR. MCNEIL: Who represents the department on the board, considering we're responsible for them. Is that my understanding from the question you had answered earlier?

[Page 35]

[5:00 p.m.]

MR. D'ENTREMONT: The board makeup of AgraPoint originally included the deputy minister, originally included the president of the college and originally included some other high-level staff. What we felt was that the deputy minister would be in conflict with some of the discussions that were happening at the table of AgraPoint because they're talking about programs and things that we need. Ultimately, I think, as a deputy minister trying to lobby government for more money or programs didn't make a whole lot of sense to us. What we wanted to do is bring it closer to our production people and our agriculture specialists. Now we have Arthur Pick who sits on the AgraPoint board, so there's a better appreciation on what's happening on farm and what kind of projects AgraPoint's working on and what kind of issues might be coming up within the industry.

The other point is, we took the president of the college off and we put on Dr. Rob Gordon - I forget what his title exactly is, but it was more on the development phase - so Rob Gordon is now on that board. The deputy minister or the president of the college can bring a certain amount of information to that board, but if you get people who are actually in the trenches and doing the work, I think we found a better opportunity for their input into AgraPoint, so we did make a couple of changes there.

The other people who sit on that board are appointed or requested appointments by the federation.

MR. MCNEIL: But Arthur is representing the department?

MR. D'ENTREMONT: He is my only representative, yes.

MR. MCNEIL: What are they doing with that $2.2 million?

MR. D'ENTREMONT: There are a number of services - production programs, support to farmers and things of that sort. The previous member did question it and we're trying to work on a list of things that they do for farmers for that $2.2 million. I have no problem in providing that.

MR. MCNEIL: I'm not interested as much in the fee for service because I would hope that the department is not funding any service that they're getting a fee for. That would be in direct competition with the private sector, which is why a previous minister gutted the department to allow the private sector to do that business. If that $2.2 million is not in programs that are directed on the fee for service side, what are you getting for the $2.2 million?

[Page 36]

MR. D'ENTREMONT: That issue has come up on a number of occasions. What we're doing is trying to get that listing of core services that AgraPoint is offering. They include identifying and acting on sound resource-based business opportunities, defining impact of applied research, effectively developing and managing client relationships. These are just some of the lists out of the document that we have on AgraPoint.

Ultimately, there are some core services that we as government, and we as Nova Scotians, would expect them to provide. We're still working on that list to ensure that we're getting the value for our $2.2 million.

MR. MCNEIL: I guess you will give me a breakdown of that $2.2 million and where it's going and what's happening with it. Thank you.

Just to switch gears a little bit, I was looking at the Farm Loan Board. I have a few questions surrounding - I'm jumping all over the place, you can tell I'm not as experienced as the previous speaker. On Page 97 of the business plan, last year was a profitable year for the Farm Loan Board. It's Page 97 and it's the Crown Corporation Business Plan. I'm just wondering, when you look at Bad Debt Expenses, it looks like $1 million to the good. I assume the parenthesis mean it's a negative.

MR. D'ENTREMONT: Apparently that wasn't the adjustment I think we talked about. In 2003-04 there was an adjustment for $1 million. So it goes back to one of your previous questions. What page are you on?

MR. MCNEIL: Page 97. I should know better than to try to follow budget lines.

MR. D'ENTREMONT: Here we go. Also not included in the board financial information of the above is the recovery of $1.055 million resulting from reduction and provision for doubtful accounts. I think that's probably why you're showing $1 million to the good.

MR. MCNEIL: Where did these bad accounts come from? Were they set aside, you yanked them off the shelf because we needed that set-up? Where do they come from? Do they sit there for a certain length of time? Do we look and say that our . . .

MR. D'ENTREMONT: The reserve account is something that is there on an ongoing basis that is adjusted depending on how much needs to be pulled out of that reserve account. It is adjusted accordingly every year.

MR. MCNEIL: Every year?

MR. D'ENTREMONT: Since I'm not a banker, if you need further information on that one . . .

[Page 37]

MR. MCNEIL: See, I don't have to, but you have to be. The other thing which jumped out at me, obviously, was the bottom net income of last year which was $3.2 million. I couldn't help but think how many times when I was around on the task force - and this is only one sector - we talked about the crisis that they're faced with and the fact of losing their entire life's work. Nobody from the Farm Loan Board has moved forward to say, we're prepared to do our part. I guess I'll ask you why?

MR. D'ENTREMONT: I've come out and said this a number of times that the Farm Loan Board will be a patient lender, they will work with all people that are experiencing problems to ensure that adjustments are made to their accounts to ensure they weather this problem through. In some cases, this has worked; in other cases, I'm sure some adjustments needed to be made. As far as I understand throughout this BSE problem, we haven't had anyone have to go off because we pulled the plug. We have been a patient and a very respective lender in this case.

MR. MCNEIL: It's one thing to say you haven't had anybody to go off because you pulled the plug. It's quite another though, and the reality is for many of these farmers, they're sitting there looking at a resource and heard that the equity has been cut in half overnight. They're sitting there realizing they can't keep up the pressures of all this building up around them and yet the interest keeps piling on a debt that they're not even meeting the means of. I'm curious whether anybody from the department said to the Farm Loan Board, I'm not asking you to forgive the debt, or did anyone come to you and say we'll suspend interest for a period of time until we can - maybe the other day when the border partially opened, did anybody from the department go to the Farm Loan Board and tell them this industry needs your support? Obviously, the Farm Loan Board was doing okay.

MR. D'ENTREMONT: I've had many conversations with our manager of the Farm Loan Board. He knows our intention to be the patient lender and to work through all crises. What you're talking about is exactly what's been done - to work with every producer to ensure that they weather the storm.

MR. MCNEIL: Being patient means that I'm willing to wait an extra year to get every last nickel that is owed to me on being a compassionate person when you're looking at the anxiety that many of these producers are going through over the last year. Is somebody saying, I'm prepared to help, I'm prepared to say I can't forgive you the principal that you borrowed, but I am prepared to suspend interest for a period of time until we, as a government, can help support this. Did anyone do that?

MR. D'ENTREMONT: No one did that.

MR. MCNEIL: You mentioned earlier about the New Entrants Program. What's the department doing for young farmers who want to get into the industry? New farmers, sorry, new entrants.

[Page 38]

MR. D'ENTREMONT: There is a New Entrants Program which, I think, is administered through the Farm Loan Board. Every year they get $600,000.

MR. MCNEIL: What does that provide?

MR. D'ENTREMONT: Funding to applicants is available over a two-year commitment, assistance is based on the amount of interest, the benefits paid out of the program should not exceed the lesser of actual interest rebate of qualified loans. If a new farmer has a loan through the Farm Loan Board, there are some pieces in there for the repayment of that loan. There's either actual interest repaid on qualified loans or $10,000 of forgiveness for that loan over two years - there's about a $20,000 investment for each farmer who accesses that program.

MR. MCNEIL: So the top end, the maximum, is $20,000? Would you say $20,000, $25,000?

MR. D'ENTREMONT: It's $20,000.

MR. MCNEIL: Okay. Is there any other - I'm sure there's always ongoing discussions, but is there anything ongoing regarding trying to encourage and support new people trying to get into the agricultural industry?

MR. D'ENTREMONT: Absolutely. That is one vehicle in which we can use. There are a number of other programs that not only a new farmer can access, but farmers as a rule can access. I sat down with the young farmers association of Nova Scotia at the last federation meeting and definitely access to capital is one that is very important to them. Buying a farm in this day and age and setting up meaningful production is an expensive endeavour and it's something I'm trying to take forward and trying to find some extra funds for. This budget year didn't allow it, but definitely something we need to address as a government in the near future.

MR. MCNEIL: On Page 3.3 of the Estimates Book, it's Net Program Expenses of Senior Management. It's interesting to note that the senior management of agriculture is $835,000. The Department of Education is about $635,000.

MR. D'ENTREMONT: If you look at Grants and Contributions, $392,000, that is grants and contributions to organizations like the SPCA, exhibition associations, and a few more that do go through that. That's probably something that's not in the Education budget.

MR. MCNEIL: But why would that be under senior management?

[Page 39]

MR. D'ENTREMONT: It had to go somewhere. I don't know the exact reason why it's there, but that's why it shows a little more than what you normally see, because of those grants and contributions. There's also a number of scholarships in there for the Nova Scotia Agricultural College. I'm just trying to get a list here of some of the discretionary grants.

MR. MCNEIL: You can give that to me at another time. That helps explain some of it. I'm not an accountant, but it seems an odd place to put an item of grants in terms of senior management expenses. I'm not blaming you, of course, Mr. Minister, for that. The Department of Finance should get some blame for some of that.

MR. D'ENTREMONT: Absolutely.

[5:15 p.m.]

MR. MCNEIL: Salaries and Benefits - I noticed there's an increase here. The estimate last year, $274,000, it's up to - if you're going from estimate to estimate - $305,000.

MR. D'ENTREMONT: Which line is that again?

MR. MCNEIL: That's the very top one.

MR. D'ENTREMONT: I think what you're seeing there is sort of . . .

MR. MCNEIL: You didn't get a raise did you?

MR. D'ENTREMONT: I didn't get a raise.

MR. MCNEIL: Okay.

MR. D'ENTREMONT: I think it's the deputy minister as well as the executive assistant's salary differences. It's a $10,000 difference on . . .

MR. MCNEIL: I agree, but not to belabour the point, there's a $10,000 difference between the forecast and the estimate. When we're justifying an estimate in another statement, we're comparing it to the estimates. At some point there has to be some consistency, whether we're going to deal with the forecast, which quite frankly is the reasonable one any ordinary person would do with as opposed to the estimate to estimate.

MR. D'ENTREMONT: Also, just to go back for the estimate, in the previous year,

2003-04, the minister had an executive assistant, basically a part-time executive assistant, so that estimate would show differently than a full-time executive assistant. It does show some adjustments in today's world.

[Page 40]

MR. MCNEIL: I'm jumping all around here . . .

MR. D'ENTREMONT: It's a good test.

MR. MCNEIL: Just one more. On Page 3.7 on the Supplementary Detail - it just shows the staff is going to increase by five. Where are the new people going?

MR. D'ENTREMONT: If you look at the estimate of 511.6 people to 512.6 people, that's showing an estimate increase of one FTE. Basically, they're transferred from Environment and Labour. We had been working on 507 . . .

MR. MCNEIL: You're confusing me because you're going from estimate to estimate again.

MR. D'ENTREMONT: The 507.9 shows the number of vacancies within the department that hadn't been filled yet. We have to account for them in the new year as we bring a few more people on line to offer other services in the department.

MR. MCNEIL: I notice there's a staff of 20.3 that's funded by external agencies. Just give me an example of that.

MR. D'ENTREMONT: Most of those are funded through the college, through the Nova Scotia Agricultural College. A lot of them are our research chairs, like the organic farming research chair, turf grass management research chair, waste management research chair, and a number of other chairs. Those people are being paid for partly by the federal government, also partly by the industry, so we show that funded by external agencies. So that's why that 20 comes in play.

MR. MCNEIL: The college, I think they have an increase of 11 actually. I guess this is one of those where you're going from estimate to estimate again, and then the other ones are just eaten up through, there's an increase of 11. Being new at this and the first time to have a look at this, one of the things that seemed odd to me would be that the Nova Scotia Agricultural College, an educational institution, was in the Agriculture Department budget in terms of - just give me a little explanation on that as opposed to why wouldn't it have been under the Department of Education?

MR. D'ENTREMONT: Definitely historical, the Agricultural College was set up under an Act for the Department of Agriculture at the time, and it's just a piece of history that's still with us.

MR. MCNEIL: I'll get a chance to ask some questions the next go-round, but I'd like to turn it over to my colleague, the member for Digby-Annapolis.

[Page 41]

MR. CHAIRMAN: The honourable member for Digby-Annapolis.

MR. HAROLD THERIAULT: Mr. Chairman, 10 minutes; if I don't get them all in this time, I'll finish up the next round. I don't think I'll take as long as my colleague here. Being a fisherman myself and probably Chris from the fishing community, we can go through these right quickly.

What I want to do is do a few little presentations, then I want to ask you the questions on them, and we'll go from there. According to the inshore fisheries groups, it seems like the provincial government is letting DFO do anything it wants with small inshore fishermen in this province. They are letting big businesses buy them up and in turn displacing and destroying much-needed jobs in this industry, and in coastal communities. The inshore fishery is worth more today than it was worth at any other time in history, and it is benefiting less and less in certain coastal communities as time goes by.

In the mid-1990s the Department of Fisheries and Oceans and their commercial licensing policy set out to provide an orderly harvesting of resources. It was also the intent of the owner/operator and fleet separation policies to protect the independence of the inshore fleet from control by interests such as processing companies. At the same time, these same processing companies realized that the ownership or control of these licences would guarantee a continuous supply of products, so the trust agreement was born. At the same time, independent fishermen on the advice of their accountants were encouraged to form companies for tax reasons. These independent fishing companies should not be confused with the larger processing companies. Small fishing companies are made up of a family-run boat in which the captain is the president of the company, the core owner of the licence, and the owner/operator of the vessel. The processing company is run by a board of directors and enters into the agreement with the owner/operator to buy all of their catch at a lower price and then share what is available at dockside.

There is, at present, one way to level the playing field of the independent inshore fishermen and that is to revamp the Nova Scotia Fisheries Loan Board. Make it accountable to the communities it is supposed to be supporting. The licence holders, as a demographic, are growing older and it is vital to this industry, and is well worth almost $1.5 billion to the economy of Nova Scotia, to be sustained and nurtured for the generations that will shortly be taking the lead in this fishery. To benefit the family-run inshore fishery, there should also be a limited number of licences available. This limit should be one licence per holder; such a limit will spread the wealth around and promote greater involvement in the fishery. Owner/operators cannot compete with large companies and their financial resources. More licences spread out with a limit to how many licences can be held will be healthy for the economy of all of the rural coastal communities.

[Page 42]

My question on that, is the minister willing to work toward revamping the Nova Scotia Fisheries Loan Board, so young fishermen in coastal communities of Nova Scotia will have access for financing fishing enterprises, and by doing so, help end these trust agreements? Go ahead answer that, I get ahead of myself.

MR. D'ENTREMONT: I want to thank the member for Digby-Annapolis for that. There are a number of interesting things that you bring up in your discourse there. If we look over the last number of years and what DFO has done with our resource and the way that they manage the fishery, they could have done a lot better, if you look at what their regulations are. The trust agreement piece, if we look at how that licence holder is able to hold onto that licence and the trust agreement basically came forward because of an access to capital. I'm going to get around to the loan board in a second. In that access to capital for younger fishermen, in order for them to get into the fishery, they had to get somebody to pay for the licence. The licence itself, since it is held by the federal government, is a non-mortgageable item. That basically comes down from the regulations from CCRA and DFO. These are some of the things that are coming in that fisheries policy review, which we've been participating in since its inception. We were the ones who were pushing to look closely at these trust agreements and the owner/operator situation.

The Fisheries Loan Board has made presentations to the federal government to look at mortgaging those licences. We've brought it up and I know that they've had a number of conversations and a lot of letters going by as well for that issue, but CCRA at this point, the federal government will not allow us to mortgage that piece of paper. So that's why we're getting into these trust agreements in order for that access to capital. This department I know has worked very diligently to try to protect the coastal communities and the fishermen held within it, to try to get that access to capital for the younger fishermen so those boats and those licences can stay in communities.

The other issue in access to capital that we need to be very cognizant of, if you're a farmer and you want to pass your farm down to your son, you are exempt to a certain point of the capital gains tax. In the fishery that is totally taxable. So your capital gains is a fair amount more. So those are two issues that I think if we can address those two issues, then the whole idea around owner/operator trust agreements will go away because the people who will be able to access the funding will be able to access the funding. I know my department has been working very hard to make sure some of these things happen.

MR. THERIAULT: Can the Department of Fisheries of Nova Scotia show me proof or documentation that you have sent to Ottawa stating that this province is concerned about these trust agreements in coastal communities?

MR. D'ENTREMONT: Yes, I'm sure I can.

[Page 43]

MR. THERIAULT: I only have a couple minutes left. I will have to wait to go to the next round.

MR. CHAIRMAN: Sure. If you want to close off your questioning right now (Interruption) You have a few minutes left if you would like, about three minutes.

The honourable member for Annapolis.

MR. STEPHEN MCNEIL: I just have a quick question he can answer about the CAIS Program and the negative margins which my understanding was when the federal minister was in town a few weeks ago, he mentioned that the federal government had a provision in that program that they were going to deal with negative margins. Does the province have anything in that program to deal with negative margins?

MR. D'ENTREMONT: There's an implementation agreement, amendment number three, which brings in the payment for negative margins and there are two other items on that, but it is on our agenda that there has to be a Cabinet document prepared for that and brought forward for OIC in order to do that agreement and I know that's in due process. So Nova Scotia is agreeing with the federal minister and as soon as I can get that OIC approval, we will be making the announcement.

MR. MCNEIL: OIC, what's that?

MR. D'ENTREMONT: Order in Council, so it would go through Cabinet.

MR. MCNEIL: That's one of the things I haven't learned yet. Hopefully, I will have an opportunity to experience that. So you will send that along to me then, some documentation around that, that's great.

MR. D'ENTREMONT: Once it's approved, yes.

MR. MCNEIL: But you also said it's based on . . .

MR. D'ENTREMONT: The implementation agreement, amendment number three.

MR. MCNEIL: Okay, can I get a copy of that from somebody?

MR. D'ENTREMONT: We'll give you as much as we can.

MR. MCNEIL: Great.

MR. CHAIRMAN: You have two more minutes.

[Page 44]

MR. MCNEIL: I will ask him an easy one then. The School Milk Program, where is that in the budget?

MR. D'ENTREMONT: Let's find out where it is, I know it's the same as last year.

This is the same. That wasn't cancelled or anything, but we will find out which item that is. Okay, if you look under Industry Development and Business Services . . .

[5:30 p.m.]

MR. MCNEIL: Where are you, which book are you in?

MR. D'ENTREMONT: Hold on, this is my book, but it would show in the Supplementary Detail if you look under Industry Development and Business Services.

MR. MCNEIL: Page?

MR. D'ENTREMONT: Page 3.5 and if you look under Marketing Services which gives you a total of $1.697 million.

MR. MCNEIL: How much of that is dealing with that program? Is that all that program?

MR. D'ENTREMONT: No, $400,000 of that would be the School Milk Program.

MR. MCNEIL: And that's equivalent to what it was last year?

MR. D'ENTREMONT: Correct. In the last two years that has stayed stable at $400,000.

MR. CHAIRMAN: Does the government member have any scintillating questions to ask?

MR. D'ENTREMONT: May I have a "Baker break"?

MR. CHAIRMAN: Is there agreement that we allow the minister to have a "Baker break"?

MR. D'ENTREMONT: I just want to get agreement on that because, you know, previously (Interruption)

MR. CHAIRMAN: We will add that on to the time. Mr. Minister, we're going to add that on to the time so, please, five minutes.

[Page 45]

MR. D'ENTREMONT: Absolutely.

MR. CHAIRMAN: We're going to recess for five minutes.

[5:31 p.m. The committee recessed.]

[5:34 p.m. The committee reconvened.]

MR. CHAIRMAN: We shall go to the Official Opposition.

The honourable member for Pictou West.

MR. PARKER: Mr. Chairman, I must commend the minister for holding up well under scrutiny here for his first real test, I guess, in the estimates debate. I really, Mr. Minister, want to come back to the issue I was discussing with you before my question ended earlier and that was around the Polar fisheries issue and I guess I just plain ran out of time, but maybe I just want to review the situation that we discussed there. We had talked about the concern over lobsters leaving this province and maybe having to be processed in another province and you had indicated that you had some correspondence with the minister in P.E.I. and you were looking at the reply that came back. Can you enlighten us again on where we are with that? Is it settled that P.E.I. does have the right to determine that lobsters from here be processed there or not?

MR. D'ENTREMONT: Well, actually we just got the letter late on Friday, so we had the opportunity to look at it today. We were concerned with the response and, therefore, it has been escalated to Intergovernmental Affairs to look at the ramifications on interprovincial trade agreements and the like. I don't have all the answers on that one yet, but I would be more than happy to discuss it as soon as we do get a clear look at it.

MR. PARKER: So you're not sure whether we're on solid ground here or they have the right to come in and have the fish processed over there or not?

MR. D'ENTREMONT: Well, we felt that it should be forwarded to Intergovernmental Affairs. There are some questions that we have.

MR. PARKER: Still awaiting the decision?

MR. D'ENTREMONT: Correct.

MR. PARKER: Let's say then that there is some way found that it's in violation of the interprovincial trade agreement or, you know, that perhaps they could be processed here at Lismore, or at Arisaig, and the plant there belongs to Ocean Choice at the moment, but if

[Page 46]

it's found that the lobsters can be processed here, or don't have to be processed in P.E.I., is it possible then that another processor could buy or lease that plant from Ocean Choice?

MR. D'ENTREMONT: I mean ultimately that would depend on the agreement that they do have. I mean there are specifics in that agreement that we would not be privy to. There are questions that I did ask in the document that I presented here and tabled here. Ultimately I'm sure there is a dispute resolution in that interprovincial agreement for this issue. Now, the asset, as far as I understand at this point, is owned by Polar Foods, dependent on that agreement with the P.E.I. Government. So how this is going to end up turning up at the end of the day is definitely business-case based and then how it fits into these interprovincial trade regulations, there's still a lot of work to be done on this one.

MR. PARKER: There's still a number of unknowns?

MR. D'ENTREMONT: Correct.

MR. PARKER: My understanding is that certainly some of the equipment that was there in that plant at Lismore at least has been leaving the plant and going elsewhere, perhaps to P.E.I., I'm not sure, but it has been leaving Pictou County at any rate. So that may not bode well for the possibility of a lease or a purchase there by someone else because there won't be perhaps too much left to lease or purchase. I guess the fish plant employees certainly would very much like to be able to still continue to work in their own home community, but if there's no equipment there in the plant any longer, then it's going to be difficult for another operator to work with nothing. Do you have any thoughts on that?

MR. D'ENTREMONT: Well, ultimately that is a private business decision that the company that owns the asset is now making. Ultimately we, as a provincial government, have very little regulation there to stop that kind of business.

MR. PARKER: Some employees certainly, you know, like I said earlier, are trying to find employment in their industry at North Nova Seafoods, which is a first-class operation operated by Paul Logan. Many of them have applied there and are hoping to be employed there if they're successful and, as mentioned earlier, some of them are also hoping they could be employed with Cape John Seafoods. Part of their difficulty there at Cape John is sufficient volume of water. Has your department been working with that plant owner to try to find a solution there to their water difficulty?

MR. D'ENTREMONT: The answer is yes, but I don't know exactly who was working with them. I don't know if it was our Fisheries rep, Cecil Rankin, who has been working with them to try to source the information they need to get that kind of water. Apparently there is a substantial amount of water required for that production and they need apparently more wells. I'm not too sure on the ins and outs of that.

[Page 47]

MR. PARKER: And Economic Development also has been working on the situation or working with the owner trying to see if there's a solution that may work for that plant. Are you privy to any of that information?

MR. D'ENTREMONT: From the conversation I originally had with you, I did go back to the department to ask and Economic Development has been working with them as well. So I know there are a couple departments and people working towards finding the resolution of the water problem, but more information I'm not privy to at this point.

MR. PARKER: No update on the situation then, whether there's going to be help for the owner there or not?

MR. D'ENTREMONT: Not yet, not at this point.

MR. PARKER: Well, I will leave that then for the moment and maybe switch gears here and go to the recreational fisheries in this province and the sport fishing industry which is a recreation enjoyed by many Nova Scotians. We're into that season, for the trout fishery at least, and I for one am one of those individuals. I like to get out there on the brooks and the lakes and the rivers. I haven't had the opportunity yet - hopefully soon - but I do have to get my licence first and I haven't quite got there.

I did notice in the estimates though that there's I think around $550,000 that's raised by the licences on the sport fishery and as you know, Mr. Minister, we've had some letters, I think to yourself and to the department, on the idea of a habitat stamp, the idea being that a portion of the licence fee could be used for conservation and to protect or to conserve the inland streams, enhance them a bit so that there are more opportunities for increasing the numbers of fish that can be enjoyed by sport fishermen.

One of those groups that has been working hard and would like to see a habitat stamp is the Pictou County Rivers Association and they've been associated with the Nova Scotia Salmon Association. I noticed in the 2004 angler's handbook that there is mention of a possibility in 2005 that this may become reality. I wonder if you could give us an update on what is the plan there. What's happening with that?

MR. D'ENTREMONT: We have a group struck in the department of different organizations, I don't know exactly the full list of that, but there is the Salmon Association, trail associations, the fishing and hunter groups and all that, that all have a seat and I don't have the exact list of who sits on that at this point. They've been discussing this $5 stamp over the last couple of years actually. We can estimate that that will increase or generate about $300,000 of direct revenue that we are going to put towards a program similar to the Adopt-A-Stream program. There are a couple of things that work really well within that program that we want to see continue. So ultimately it's something we're still in discussion with as it was in our booklet, our handbook, to advise the population that this would be

[Page 48]

happening and give them the opportunity to put their input into it. So far we're seeing more people who are really for the idea of that habitat stamp to work towards fixing the rivers and streams where applicable.

MR. PARKER: I think there's a lot of support out there for it and certainly some of the conservation groups I've talked to, they would very much like to see it and under the Adopt-A-Stream program, I know there was a lot of good work done by some of these conservation groups, but they need funding. They need some source of money that they can go and work also with volunteers who are willing to go out and restore habitat on larger rivers and smaller streams. It does make a difference. So it's really a way to leverage some money, you know, $300,000 will probably get you much more value in return for that. So, again, is it planned for 2005?

MR. D'ENTREMONT: That's correct. We were looking at this year as a possible date for implementation, but we didn't have enough time to advise the public nor did we have time to print the stamps and do all that stuff. So we're looking towards doing that in 2005 depending on the public consultation piece. We still have a few months of open dialogue there where people would have the opportunity to make their views known but, as you say, there are way more people who think this is a good idea. So I do see us putting that into place in 2005.

MR. PARKER: Will that be added onto the regular licence fee, is that the plan, or is it going to be part of the present licence fee?

MR. D'ENTREMONT: A separate stamp, as far as I understand, is how it will be done. The example I think you have is sort of a duck licence. You go out and buy a duck licence and you buy another habitat stamp to go with it. So it's a separate piece from your regular licence.

MR. PARKER: So the licence fee right now, I think, is $17.25, or something, with the HST included and I think they're going up January 1^st, is it, the fee structure will increase?

MR. D'ENTREMONT: That's correct.

MR. PARKER: Which gets to what, $19, or something? I can't remember what the total would be. So then with the habitat stamp on it, it would be maybe in the range of $23,

would it, for everything?

[5:45 p.m.]

MR. D'ENTREMONT: That's correct.

MR. PARKER: Okay, the plan is that it will happen in 2005?

[Page 49]

MR. D'ENTREMONT: Most hopefully see it in the booklet for next year.

MR. PARKER: Okay, well that's good news. It's going to be more money for the privilege of sport fishing, but I think there will be good strong support knowing that a good portion of that is going back to conservation.

I mentioned the Pictou County Rivers Association, it just happens that this weekend coming, April 30^th, May 1^st and May 2^nd, they're having their annual fisheries' expo at the New Glasgow Stadium in New Glasgow. It's open to the public and certainly, Mr. Minister, if you wanted to attend then I'm sure you'd have an opportunity to visit there with lots of sports fishermen, and they have a number of booths set up and businesses that associate with the sport fishery. Some larger businesses like Kimberly-Clark and others that are supportive of the outdoor recreation. It's just a good show and I certainly want to invite you to come up Friday night, Saturday or Sunday, if you're able to do that in your busy schedule. It's attended by thousands of local and regional people on the North Shore.

Okay, I'm going to ask you some other questions here from the estimates on other issues. You had mentioned in your opening remarks about, I think is it bacteria or a virus in the Bras d'Or Lakes, MSX? Can you give us a little more detail on that and how serious a problem that is to the fishery up there?

MR. D'ENTREMONT: MSX is a parasite of oysters. It's a parasite. It was confirmed at causing high levels of oyster mortalities in aquaculture sites. What happened is, a lot of the oyster farmers went into the leases and found a large amount of them were dead. There was a bit of an investigation done through CFIA, the Department of Fisheries and Oceans. The parasite persisted through 2003, but the mortality levels are actually going down a little. DFO scientists speculate the parasite is now in northwest Cape Breton's Aspey Bay. There is a map that we have of where the MSX is in the Bras d'Or Lakes and it's not in all of the Bras d'Or Lakes, but in certain little coves and inlets throughout it.

Federal restrictions in oyster movements have caused significant hardships to affected oyster farmers who are unable to move their oysters from their seed locations to their farm sites, so a lot of guys will have let's say two aquaculture leases, one where they do their seeding and then they would move that seed stock onto their strings. This is not a human health risk. This is just simply a risk to the oysters themselves. In some personal cases that I've chatted with, some of the fishermen they've gone from one year or two years away from taking those things out of the water for sale, to nothing sitting on the sites, so definitely a very difficult problem that we have in the Bras d'Or Lakes right now for oyster farmers.

MR. PARKER: How big an industry is the oyster industry here in the province?

[Page 50]

MR. D'ENTREMONT: In my speech I referred to aquaculture as being, I believe, a $40 million industry. A good part of that would be oysters. We've had a shift in our aquaculture industry from finfish to a lot more mollusks, clams, other shellfish, and the big part of that was this growing business within the Bras d'Or Lakes of oysters, but the exact amount, I would have to find out for you.

MR. PARKER: Mussels certainly too, is a part of that industry.

MR. D'ENTREMONT: That's right.

MR. PARKER: Maybe then I'll ask you a little bit about the aquaculture industry here in the province. How many sites do we have in Nova Scotia at the present time, and do you have the breakdown on the number of mussel farms or oyster farms or finfish operations?

MR. D'ENTREMONT: That information is available. I don't think I have that right with me.

MR. PARKER: It's an approximately $40 million industry in total?

MR. D'ENTREMONT: Yes, aquaculture product is worth almost $40 million, as I stated in my opening statements.

MR. PARKER: If it's possible to get that information broken down by species I guess, it would be helpful.

MR. D'ENTREMONT: And maybe give you some site information.

MR. PARKER: Okay, I guess also in relation to that, the number of - I guess some of them are operated on the Native reserves as well?

MR. D'ENTREMONT: Yes, that information would all be encompassed in that $40 million.

MR. PARKER: The number of Native-operated agricultural sites too, then.

MR. D'ENTREMONT: Yes, because they still have to have leases put through the department, so we have all that information listed.

MR. PARKER: Is it a growing industry in Nova Scotia would you say? Are we maintaining our own or actually increasing?

[Page 51]

MR. D'ENTREMONT: Actually, it's increasing. I forget last year's numbers, but it was sort of like, we've grown by quite a few million dollars this year in our business, so it is something that's been growing over the last few years at a pretty good rate, but it was stagnant there a few years ago.

MR. PARKER: In comparison to our neighbouring Province of New Brunswick, I think we're a much smaller industry here, are we not?

MR. D'ENTREMONT: Absolutely.

MR. PARKER: I don't know what their numbers are, but we're at $40 million, they're a long way ahead of that, I think, are they not?

MR. D'ENTREMONT: If you look at the industry, it's a fair amount different in New Brunswick where they did have a lot of finfish production, salmon production, while here in Nova Scotia, we looked at that a little differently, like I said, we're getting a lot more into the hard shell type aquaculture. Less impact to the environment, et cetera.

MR. PARKER: You also mentioned in your opening remarks around the problem of habitat degradation, and difficulties around that. I guess some of the concern amongst the public in that regard is habitat destruction that is occurring because of scallop dragging. Well that's the way the industry has been for a long time, but it's still, my understanding, quite destructive to the environment. Are there any initiatives within the department to look at that issue to see if there can be a better way of doing things?

MR. D'ENTREMONT: I think, in my opening remarks, the reference to habitat degradation did talk about inland fisheries and working with the federal department on that memorandum of understanding on habitat restructuring and stuff, so that's where the stamp piece did come in.

MR. PARKER: I remember the terms, but I just couldn't remember what it referred to. Now that I brought it up around scallop dragging, is that an issue that might be looked at as under habitat degradation?

MR. D'ENTREMONT: Ultimately, those things are federally governed. I know it's information that has flowed through the department on a number of occasions. We do have a number of people within the department who do keep track of all the things that are happening there, but it definitely falls under a federal mandate.

MR. PARKER: It's an issue that I've heard amongst some in the public who feel it's a real problem they'd like to see addressed.

[Page 52]

I guess I'm going to ask you a couple other questions here on the fishery. The seismic testing, I guess, was an issue last year off of Cape Breton in the Cabot Strait. There was real concern that maybe damage was going to be done to the larvae of a number of species, like lobster and crab and shrimp and so on, because they float on the water and the seismic waves would cause problems for them. There was some testing done last December, as you know, off Cheticamp. Many fishermen are opposed to that. They're concerned about the damage that could be incurred to their industry. It may be not just now, but it might be years down the road before those species are mature and they can see some problems with them. I'd just like to know, what is your position on seismic testing?

MR. D'ENTREMONT: In my opening remarks we discussed a mission that went to Norway and Scotland to look to see how oil and gas and fishing coexist in those areas. I think we, as a department, believe that these two industries can coexist, if they're managed correctly. That's why we have in place the CNSOPB, the Canada-Nova Scotia Offshore Petroleum Board and the scientists held within it. The fishing industry has a strong voice within that organization. We can mitigate, I'm sure, most impacts through good dialogue and finding the best times to do things.

If you look at when the seismic happened, it was done in the Winter when there would be no larval drift going on at that time, but this all comes from good science and doing this slowly and making sure the research is done, which is one of the concerns the fishermen did have during this first round of seismic testing in that area. It's my department's feeling that we're there to be a resource for information for the CNSOPB and for the fishermen as well, but we do believe, and I believe myself, that these two industries can coexist.

MR. PARKER: On the south coast of our province, on Georges Bank, there is a moratorium there on oil and gas drilling and I guess many were hoping that on the North Shore, on the very sensitive and productive fishing grounds, that the same thing could happen. Really a precedent has been set. There's an oil and gas exclusion zone, I guess you'd call it, and that's certainly a very valuable fishery on Georges Bank, but likewise, there's a very valuable breeding ground on the Cabot Strait or the Northumberland shore. Is that something the department may consider looking at, is an exclusion zone to protect the fishery as has been done on Georges Bank?

MR. D'ENTREMONT: That proposal has not come forward to our department. I know this might be the discussion that came forward to CNSOPB who would be the lead agency on this one. As a department, I think that we still believe that they can coexist and as long as the science and everything is done correctly, so it's something that we will work toward.

MR. PARKER: Okay, thank you. Another issue that's been in the news in my area lately has been around the professionalization of fish harvesters; in fact, they're doing a referendum right now in our area to see whether they want it or not. I think it's happening

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in other provinces and there seems to be a fair amount of support for it, but does your department have any thoughts on that, on what the right way to go, or not, is?

MR. D'ENTREMONT: We support the issue of professionalization of the industry so that when the industry comes to us and says they want to do this, we'll be there to help to make sure it happens. Right now the issues that you're talking about in your area, there was a vote going around finding what harvesters thought of the whole idea of professionalization, with some public consultations on what they would mean or what it could mean. That's sort of the conundrum we're in on this issue, is that we're still designing around what it could mean.

I think in the end this is fueled a lot by the Department of Fisheries and Oceans on the issue of registering fishermen, the fisheries' registration division of DFO. DFO has said that they were going to be getting out of that business and industry has sort of stepped up and said we'll do that, but there has to be something else we can get out of fisheries registration and that could be some training opportunities for deckhands, captains, whatever. So there's a lot of discussion going on of what professionalization should be and there's also the vote going on right now of whether or not it should happen, and asking fishermen whether they want to see something like this happen. Right now it looks pretty positive.

MR. PARKER: There seems to be good support for it in what I've heard along the shore anyway, and people probably are going to vote for it in my area, it's my understanding. It seems to have worked well in Quebec, and perhaps elsewhere.

Another issue that has come to my attention is around the diesel fuel, I guess that's used by fishermen on the water. They are paying full taxes on that when they purchase it, and it's a motive fuel tax, I believe is what it's called, which was designed to go back into our road system in the province, and goodness knows it needs to be spent in that area. Fishermen feel that maybe this motive fuel tax is something that they're paying, but it's not going for the purpose it was designed for, which is on our rural roads in the province. They're wondering, I guess, if it's possible to get a rebate or some system of getting that money back because it's not going where it was designed to.

It's similar to what is done in the Nova Scotia woodlands for roads on private lands, and again, forest operators are buying fuel and there is a system in place now for them, I think it's the Nova Scotia Forest Products Association that collects money in lieu of the money that would be spent on forest roads. I don't know if you're aware of that situation or not, but it's an issue out there similar to what the forest industry has done. Is it possible that somehow that money could be rebated to fishermen's organizations or somewhere for, I don't know, educational purposes or something?

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[6:00 p.m.]

MR. D'ENTREMONT: I think if you look at the issue of fuel, I mean there's always the issue of dyed fuel in non-fishing vehicles. I don't know the whole issue, this would definitely be a Finance issue in view of taxation, but I know that fishermen do pay a lesser rate of tax on the fuel. Now I don't know exactly what that rate is, but I can get that information for you as well. I know they do get a reduction if you're talking about that whole issue of dyed gas and dyed diesel.

MR. PARKER: Yes, farmers have that too. It's just the idea that it's been used on the water instead of on the land where it was intended to go, the same as on private roads, it's going back to associations. It might be an issue, perhaps, you could look at.

I was going to come back to the issue of, I guess, interprovincial trade. We had talked earlier and we talked about lobster in particular at that time, but there's a lot of trading back and forth, I know, between fish plants and some owners who own plants in different provinces and, for example, I know shrimp I think right now are going to be shipped into Canso, which is a godsend for that community, that it provides some employment that's been a long time coming. There have been some problems too, with trade. I think there have been some restrictions. I think Newfoundland is not allowed shrimp, for example, that's been caught in their waters to be exported out of that province and there have been some restrictions, I think, with Quebec as well. Can you address that issue around interprovincial trade, and is Nova Scotia a winner or loser in this issue?

MR. D'ENTREMONT: There was an issue last year or the year before, I think, in crab. Basically what happened was that crab was being taken out of Nova Scotia and sent to Newfoundland, and that wasn't reciprocated where we couldn't take crab out of Newfoundland to bring to our plants here, so that border was closed on the transfer of crab to Newfoundland. This is the only restriction that we have in place right now on any interprovincial pieces, but just be sort of more of a, they do it to us so we ended up doing it to them, in that trade agreement.

I think we're the winner here because we can take product from New Brunswick and we can take product from P.E.I., whose seasons open sooner, so we can get some of our processing plants, actually like they do at Louisbourg Fisheries, also I think in Richmond County they can get a fair amount of crab earlier than when our season opens, so they can get the production going and access those markets and get into the markets a little earlier. So I think we're the winner with some of these open borders that we do have with some of our neighbouring provinces.

MR. PARKER: It seems the ideal would be open borders and free trade amongst all provinces. I know in Newfoundland, as I said, on shrimp and crab in particular, but you say crab is the only one right now that's blocked from coming both ways. I was going to ask you

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too about your department's thoughts on seals, and it seems to have been in the news quite a bit lately and there's some type of quota system on seals now, I think on federal quota is it? I forget the exact figure. As you know, it's a controversial subject. Some are very much in favour of getting rid of them, and some don't want to see any harm done to them. Does the department have a policy on seals here in Nova Scotia?

MR. D'ENTREMONT: Our stand on it has been and will continue to be that we support a humane harvest and a plan to go forward on these animals. There doesn't go a day in my discussion with fishermen that the issue of seals doesn't come up. Do we have all the answers on this one yet? No, we don't. I think there's a fair amount of research still needed to be done on this issue, whether it be the stock size, how to harvest them and then what do you do with the products as you do harvest them. There's still a lot of unknowns in this one, but we do support that to be done in a humane, economical way in a professional manner.

There are a number of organizations that have come forward with a couple of proposals - of course, DFO are the ones that do manage that resource, so I think we're still waiting on the plan. I apologize if they've already come down with a plan for grey seals at this point, but I haven't been privy to that yet.

MR. PARKER: In a few minutes, Mr. Chairman, I'm going to share my time with the member for Halifax Atlantic. I just have a couple more questions for you, Mr. Minister.

One issue that I've heard concern about is around the intergenerational transfer of boats and gear and licences from father to son or daughter. It's mainly because of the tax implications and the high cost that CCRA will get their piece of the pie, I guess, which makes it difficult for the young fishermen to buy out or the older fishermen to retire. I understand the Province of Quebec has done some work on this and they've come up with a policy that I think would raise the capital gains allowance from $100,000 to $500,000. With boats and gear up close to that now in value, what is your department doing to work with the federal government or seeing what other provinces have done to assist this transfer between one generation and the next?

MR. D'ENTREMONT: Really, at this point there hasn't been a conversation with the federal minister that I haven't brought up that issue with him. I know my department has been working with their officials within DFO on this issue and I know that we've had a couple of conversations with people at CCRA to look at the capital gains tax and try to get some kind of capital gains exemption for that intergenerational transfer. It seems like an issue that's taken a fair amount of time to get accomplished.

MR. PARKER: It's a complicated issue and yet I understand Quebec somehow has worked out an initiative for their fishermen that seems to be working for that province. I would encourage you to continue your negotiations or discussions with the federal government. It is a real concern when you have to pay out $100,000 or $200,000 in tax to

[Page 56]

the government in order to transfer from father to son. It's an issue that needs to be dealt with.

I guess with that, Mr. Chairman, I am going to share my time with the member for Halifax Atlantic. I'll turn it back to you, then.

MR. CHAIRMAN: The honourable member for Halifax Atlantic. You have a half- hour left.

MS. MICHELE RAYMOND: I'm not going to use all that. I have a few questions that probably come largely from an urban background. As you know, my riding is shared very much between the heart of Halifax and some of the outlying fishing communities, particularly, although traditionally it is an agricultural area as well.

Speaking from that point of view, I would quickly say that I can't help agreeing enormously with Mr. McNeil when he says this is a gold mine that you are looking at. When you look at tourism promotion and all the rest of it, I always think of tourism as an export industry - one is exporting experience - and agriculture and fisheries are not of necessity export industries and I hope that the ministry has this very much in mind.

With that, I think I would follow Mr. Parker's lead and ask about interprovincial trade and so on. I was in New Brunswick recently and in visiting a grocery store I noted that one chain of grocery stores has a program of these food vouchers that people can sign - you sometimes see them at Christmas, donate x dollars to your local food bank by adding this to your grocery bill. But I was interested to see that this particular one was donate x dollars of New Brunswick produce to your grocery bill. Is that something that is philosophically in tune with the Department of Agriculture and Fisheries to promote?

MR. D'ENTREMONT: If you look at the whole issue of Buy Nova Scotia that we did talk about a little earlier of trying (a) to get these products into some of our institutions and (b) to talk with the retailers and seeing what they can do for us, we've already sat down with Pork Nova Scotia, the processor, as well as the grocery stores, to see what kind of specials they could run with our own products, see what they do already. I think we can gain a lot from sitting around a table and discussing these issues. I think it's definitely a part of our philosophy in the department to try to get as many of our Nova Scotia products into our stores rather than having to try to export them all the time.

MS. RAYMOND: That is an explicit goal then, I take it.

MR. D'ENTREMONT: Absolutely.

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MS. RAYMOND: The other questions that I had are really just scattered. One of them, Hurricane Juan did a fair amount of damage in my riding, Halifax Atlantic, and the people who were hardest hit were fishermen in the Sambro area and in Herring Cove as well. The hurricane happened, I think, three days before the opening of crab season and there was absolutely no time to waste. They set to reconstructing their wharves and dragging their boats back off the shore and into the water and so on. When it came time for dealing with insurance companies and with the provincial EMO or the disaster relief fund, there was real trouble. Apparently a number of them were told that their reconstructed wharves would not be eligible for any kind of assistance from the disaster relief fund because they were not built subject to engineering drawings.

Agriculture and fisheries are both traditional Nova Scotia industries. They both are frequently using infrastructure of considerable age. When they have to be replaced, they've got to be replaced promptly. I'm wondering if there have been any kind of negotiations between the Department of Agriculture and Fisheries - I shouldn't say negotiations, but any kind of facilitation to remove these kinds of conditions when reconstructing viable, intact wharves in the face of disaster?

MR. D'ENTREMONT: When we started the whole discussion of our participation in a disaster relief program, which we came up with the $10 million for farmers, fishermen and foresters, there was a caveat in there for fishermen for the reconstruction of wharves. I don't recall the exact numbering - we can get that information for you - but as far as my recollection on this one was that if you had a wharf and you can prove to us that you had a wharf, we can give you a one-time lump sum payment of $5,000 to reconstruct the wharf as it was. If you wanted more money to reconstruct a newer wharf, then you would be subject to new engineering rules which could be supplied through our department. Our department does have people on staff that basically have this wharf that you can build that you can get all the drawings for. I'm not too sure - it was either $15,000 or $25,000 that you could get through the program for the reconstruction of those bigger wharves. But I can get that information for you.

MS. RAYMOND: That would be great. I guess it's sort of the broader issue which is, are there some specific considerations for the kinds of things which have frequently withstood everything but disaster?

The last question I have and you may have addressed it already while I wasn't in the room, there is, as you know, the whole issue of biosolids and so on. One thing that I have not heard brought up - I know there were some studies done at Cornell four or five years ago that said groundwater in the areas surrounding unserviced areas - this is in the United States - was contaminated with excreted pharmaceuticals. That's not a concern that I have heard raised about the biosolid issue. Has that been addressed or will that be addressed?

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MR. D'ENTREMONT: We've been watching this issue very closely. The department is awaiting the Department of Environment's ruling on this and the review of that practice. In a bigger context, this is a normal farm practice in the country, but it's something that we wanted to make sure that every avenue is explored. We're waiting quite patiently for the Department of Environment's . . .

MS. RAYMOND: So that parameter is being explored, that particular parameter?

MR. D'ENTREMONT: As far as I understand. You have to ask the Minister of Environment and Labour. I don't know the exact guidelines.

MS. RAYMOND: Because you're the second line of defence, of course. Thank you.

MR. CHAIRMAN: We still have about 15 more minutes. Would you like to continue the questions?

The honourable member for Cole Harbour-Eastern Passage.

MR. KEVIN DEVEAUX: Mr. Chairman, just so I'm clear, it's 6:35 p.m. that we're done?

MR. CHAIRMAN: No, 6:45 p.m. We started at 5:45 p.m. with the member for Pictou West, I believe.

MR. MACDONELL: Mr. Chairman, I think it was 5:30 p.m.

MR. CHAIRMAN: With the agreement of the committee, I will amend . . .

MR. MACDONELL: There was a five-minute break in there so I think it would take us to 6:35 p.m. for our caucus.

MR. CHAIRMAN: Okay, so 6:35 p.m. is what we'll go to.

MR. DEVEAUX: Thank you. I want to ask questions about Acadian Affairs if I could, the Office of Acadian Affairs. Mr. Minister, I don't think I'm asking anything we haven't discussed ourselves. I would just like it put on the record so that there's some sort of record with regard to this.

You recall that a couple of weeks ago there was the issue I raised about this being the 400^th Anniversary of Acadians arriving in North America. I was hoping, and I know we've had this discussion before privately, that there would be some - more than symbolic - substantial recommendations from the government or legislation that would allow for the protection of the French language in Nova Scotia. I'm not talking about bilingualism here, I'm

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talking about basic services being provided in French, something that I think seven or eight of the provinces in this country have, ones with, as a percentage, a smaller number of Francophones than we have - Alberta, Saskatchewan, Manitoba; Prince Edward Island has a smaller total number.

I think that one of the things that I've noticed is some sense that through assimilation the Francophones and the Acadians in this province have lost a lot of their language and those people who are of Acadian descent, every year there are more of them who lose their language, maybe because they move to Halifax or because they move away, or even in their own towns. Now, we've done some things to help prevent that. Through the Charter of Rights you have guarantees of being taught in your minority language. You have the right to certain criminal trials in French. Those things are guaranteed under the federal Charter of Rights.

If we're going to make this language a viable living language in Nova Scotia, which I would hope we would, some sense of what we can do to ensure that there is a guarantee of certain services because most of the services that people would be accessing in this province are provincial, whether it's obtaining a health card, going to a hospital, a long-term care facility, Family Court, summary offence proceedings, motor vehicle and so on, those sort of things, going to an Access Nova Scotia office. I guess I was hoping to get from you some sense as to how much of a priority it is for your government to try to ensure that we do have legislation this year passed so that we can have a guarantee of French services in Nova Scotia?

MR. D'ENTREMONT: Ultimately we've had this discussion on a couple of occasions and I know that I've had that discussion with a number of people. If you look at where we've been in the last 16 years or 19 years that we've had an Office of Acadian Affairs, I think we've gone leaps and bounds over the last 10 years or so with the creation of a CSAP and the French school board and those types of things. We're still lacking a little bit in basic services such as the ones you bring up, like health cards, licensing, just some good basic services to Nova Scotians, and it's something that I, myself, would like to see happen. So ultimately within our Office of Acadian Affairs we've set up an advisory group of senior bureaucrats within the departments to look at service options within each department.

We've just recently announced the creation of a post in Health for French services. She'll be working within that department to see what services are required. I think we have people on the ground in each department looking at the services that would be required and we're waiting on producing that action plan from the committee soon (Interruption) Sometime towards the end of Summer - to have all those services that would be required. La Fédération acadienne was able to provide us with a tremendous document of what they would see us offering and going to the future. So some of these things are definitely some of the stuff we want to get in there and offer to Nova Scotians.

[Page 60]

MR. DEVEAUX: There are a couple of questions flowing from that, but I want to start, can I get a commitment from you that we can get a list of who is on this advisory committee? I understand it's bureaucrats, right, it's staff?

MR. D'ENTREMONT: Yes.

MR. DEVEAUX: One from each department?

MR. D'ENTREMONT: Right.

MR. DEVEAUX: So that's fine and for the record then, we can get a commitment that there will be some list provided?

MR. D'ENTREMONT: Absolutely.

MR. DEVEAUX: Now, has there actually been an audit done of the government to determine both - maybe this is partly what you're talking about - positions that should be bilingual and also individuals who are bilingual now?

MR. D'ENTREMONT: There is an inventory of how many Francophone or bilingual people we do have, but we're still working on the services that they would be required to do, but there is an inventory of civil servants right now who do have those capabilities.

MR. DEVEAUX: How many people in the Nova Scotia Civil Service, Public Service I guess - let me back up. Are we talking about the Civil Service, people directly employed by departments, or are we also talking about health authorities and other things as well?

MR. D'ENTREMONT: I think it's the greater context of health authorities and . . .

MR. DEVEAUX: How many people actually are able to speak French at a functioning level?

MR. D'ENTREMONT: I think we're still finding that information. So as soon as I get it available, I will provide it to you.

MR. DEVEAUX: The other question I had is, someone was telling me, and I guess I'm trying to clarify for the record, if we went ahead and did provide legislation that provides certain services, or a guarantee of certain services in French for Acadians and Francophones in Nova Scotia, does the federal government pony up money in those circumstances and is that part of an MOU, or how do you go about doing that?

[Page 61]

MR. D'ENTREMONT: In the Canada-Nova Scotia agreement on official languages, I think that's what it's called, they do have funding of up to 50 per cent for Francophone and bilingual initiatives happening within government.

MR. DEVEAUX: So are we now drawing on some of that money right now?

MR. D'ENTREMONT: Absolutely.

MR. DEVEAUX: And for what purposes, what exactly are we drawing it on?

MR. D'ENTREMONT: I have a list of projects if you could just hold on for a second. What others - I'll give you a quick rundown.

MR. DEVEAUX: This is separate from what the Education Department gets under that for French language in the schools.

MR. D'ENTREMONT: Correct. If you look at Grants and Contributions, Centre Scolaire Etoile de l'Acadie received $10,000 in assistance for the Francophone centre for the promotion of the official languages, le Comité Provincial des Jeux de l'Acadie and Conseil Communautaire du Grand-Havre. So these are some community projects that we have. If we look more closely at government, the Department of Transportation and Public Works, there was $35,000 for the signing, the design and construction of brand new offices. There was also the project on signage that was announced a few weeks back so we can actually have some signs at all our Acadian entry points whether it be the boat in Yarmouth, whether it be off the highway, saying that this is an Acadian region and this was something that was funded through that project as well. There were a few other programs through DNR, I think there were some signage programs in parks, et cetera.

MR. DEVEAUX: But we are clear that if you did move towards legislation guaranteeing health or certain court services, a certain amount of money would flow from the federal government on a 50/50 basis matching funds?

MR. D'ENTREMONT: Matching contributions.

MR. DEVEAUX: So specifically around the legislation then, now that we do know that there has been an audit, an inventory done of the staff who are bilingual, we know that you have a committee that's up and running which I commend you for with regard to developing some sort of coherent government policy, what is your prognosis as to the ability for us to get legislation this year with regard to guaranteeing certain services in French?

[Page 62]

MR. D'ENTREMONT: I think we're still working on what those things shall be and whether they require legislation or they require just regulation. I think regulation would probably be the easy way to go and to designate those services that are required, but there might be a requirement for legislation as well and we're still exploring that.

MR. DEVEAUX: I would suggest to you that, obviously, the benefit of legislation is, next to something being in our Constitution, the most entrenched form of law. Regulations can be changed by Cabinet on any given day. I say this, I guess, as much as a comment as anything, that you can have some flexibility. I mean a lot of things can be put into regulation, but knowing there's a law that's passed by the Assembly, I think it's a lot of symbolism towards Acadians in this province, but also would ensure that there would be a certain amount of entrenching those rights. You would have to have a Legislature repeal that law or amend that law before those rights would be changed. So I think that just gives a little more oomph, for lack of a better term, to it. La Fédération acadienne de la Nouvelle-Écosse, I spoke with Mr. Laroche, I think, is it?

MR. D'ENTREMONT: Mr. Leger.

MR. DEVEAUX: At your Acadian Day press conference, he was suggesting to me that they're working on legislation as well. Is that your understanding, that they have draft legislation of their own?

MR. D'ENTREMONT: We are aware that they are working on something, but it's something we haven't seen yet.

MR. DEVEAUX: Do you expect to get something from them in the next little while as part of the process of identifying potential legislation?

MR. D'ENTREMONT: I have a community consultative committee as well, and La Fédération acadienne does sit on it, so I'm expecting that maybe we could have that discussion - I think my next meeting is tomorrow. So I should be hearing soon.

MR. DEVEAUX: And who else? This would be like FANE and FPANE, is that who's on it, when you talk about this committee?

MR. D'ENTREMONT: It was a committee originally set up by the previous minister, and it was sort of more of a broader context community, people from Richmond, people from Cheticamp, people from our neck of the woods, from Clare, so it's a little broader than what the federation has. La Fédération acadienne is, of course, made up of all those groups.

MR. DEVEAUX: Is it an advisory council to you, sort of officially or unofficially?

MR. D'ENTREMONT: I think it is an unofficial advisory council.

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MR. DEVEAUX: Did you set it up or was it set up . . .

MR. D'ENTREMONT: It was set up by the previous minister.

MR. DEVEAUX: Mr. LeBlanc.

MR. D'ENTREMONT: Yes.

MR. DEVEAUX: That raises a question, though, which I think is interesting. I think there are at least two parts of the province that aren't traditionally Acadian, but in the last few years particularly have developed strong Francophone populations. Greenwood being one, I think just because of the military base, the other being Dartmouth, particularly in the eastern part of Dartmouth near the schools, du Carrefour and Bois-Joli . I'm just trying to get a sense, do you have representation from those people? I think that actually the largest Francophone community in the province is Halifax, given the numbers. Is there some sense of getting feedback from them?

MR. D'ENTREMONT: One of the members of it is a gentleman by the name of Joe Cottreau and he and Vaughan Madden, all those people do belong to this community now. They might be from other places but do now reside in Halifax.

MR. DEVEAUX: I guess longer term, from my perspective, one of the things I noticed with regard to the Acadian community is that they are very small communities, whether it be Pubnico or Isle Madame or Cheticamp or Pomquet. These places aren't very big, and in many cases, let's be frank, no different than an English community, they end up leaving to go to a bigger city. In the case of the Francophones, though, when they come to Halifax, for example, they're going to lose the language because there just aren't the services here. The classic example that came up a couple of years ago that isn't related to the government is a Roman Catholic Church in French.

I don't expect you to go talk to the Archbishop about that. In Moncton, if you're in New Brunswick, and obviously they're a larger percentage, you have a bilingual city. You can live and work in your language. I guess I was wondering if your government or you as a minister have put your mind to how, in the long term, we can ensure that there are certain services, whether it's legislation or maybe other things to ensure that there are services being provided for Francophones here in Halifax?

MR. D'ENTREMONT: That is the bigger picture of the issue of government services for Nova Scotians in French. To the issue of the church, right now, with le Carrefour du Grand-Havre, that piece of infrastructure did create that sort of community of Francophones in that area. I do know the Roman Catholic Church does sit there on Sunday mornings. I think in a broader context we do have to seriously look at the future of the people. I think the CSAP and seeing French schools and seeing what's happening there has definitely given a lot

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of different perspectives of the Acadian community and a little more consciousness of your culture and how important that language is to you.

[6:30 p.m.]

As the students now graduate from that system, I think you will see them continue their education in French, or once they get out of there and graduate from there, I think they're very proficient, a lot more proficient than I think some of us would have been quite a few years ago. I think that creates a better sense of community because they've been through that system. So I'm hoping we'll be reaping the benefits of that initiative in a very short period of time.

MR. DEVEAUX: I will probably ask the same question of the Education Minister when he does Supply, but from your perspective as the Minister of Acadian Affairs, we talk about a shortage within the French Immersion Program, Anglophone students learning French in school, there's a shortage of qualified teachers, do you have some sense within the CSAP whether there is something similar going on and, if so, as Acadian Affairs Minister, have you looked at how to address that?

MR. D'ENTREMONT: I know that the CSAP has had some problems in certain areas of finding the teaching staff that's required to offer that service. I haven't had a discussion with the minister lately about it, so I'm thinking that it must be a situation that is in hand. Yet, that does create a bit of a problem in our English system, where those schools that do have an immersion system, going through it, to access some of those teachers. There have been a couple of adjustments made with Université Sainte-Anne in how they graduate their students. It went basically from a six-year program to a five-year program. We're fast-tracking that a little bit, and then trying to make sure that we can get teachers from New Brunswick or wherever else, and making sure we go into our schools and our CSAP now and definitely push that career on our students, to see if they want to go forward and be French teachers.

MR. DEVEAUX: So is it your sense, though, then that - I'm not trying to put words in your mouth, I'm just trying to clarify - you're working on legislation but is it your hope, this being the 400^th Anniversary, that we might have something for the Fall? I'm not asking you to commit, I understand you can't because it's a Cabinet decision. But in the best possible world, you as the Minister of Acadian Affairs, would you hope to have something for the Fall?

MR. D'ENTREMONT: It's my intention.

MR. DEVEAUX: One of my last questions if not my last is, we have a bill before the House right now with regard to education facilities, making them accessible, but it doesn't include P3 schools. At least in the Halifax-Dartmouth area, I think all three of the CSAP

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schools are P3. I'm trying to remember, is there one that isn't? (Interruptions) Are you sure about that? I thought it was actually built first.

MR. D'ENTREMONT: Le Carrefour du Grand-Havre is not a P3, but I think Beaubassin and Bois-Joli are.

MR. DEVEAUX: So Bois-Joli is connected too, is it not? They are separate, okay. Your understanding is that at least the people in that community, the Francophones in Halifax-Dartmouth, would have the opportunity to at least have that school, if no other school, if that's at all possible. When does the memorandum of understanding with the federal government end with regard to official languages?

MR. D'ENTREMONT: Right now we're in a limbo year. Basically the agreement came due on March 31^st. We were given a one-year extension from the federal government. I don't know if they were unable to negotiate this year or not. We have been given an extension on that, so it gives us sort of another year as usual in order to develop the new plan. The new plan, this year we went from - excuse me for a moment, I want to get the right numbers here. Through the agreement, we're trying to access another $600,000 or so. So it will bring us up over the $1 million mark for operations of the Office of Acadian Affairs and the commitment to do things within government. We're trying to get ready for either regulation or legislation.

MR. DEVEAUX: Thank you. Those are all my questions.

MR. CHAIRMAN: The Liberal caucus. It's 6:35 p.m. and we're going to 7:10 p.m., since we added on five minutes for a much-needed break. Who will begin the questioning?

The honourable member for Digby-Annapolis.

MR. THERIAULT: Mr. Minister, I would like to bring you back to the fishery, if you don't mind. I would like to touch on aquaculture first. Probably as you know, in the early 1970s, Nova Scotia was a leader in the development of marine aquaculture in North America. Since this time aquaculture has become a significant contributor to Nova Scotia's economy with an export value that has reached as high as $50 million in 2001. With today's current export value of - I have $29 million, but you said $40 million, so we'll split the difference. Anyway, it has gone down since 2001.

While aquaculture in Nova Scotia has grown since its pioneer days, it's had a very slow growth in Nova Scotia compared to many other provinces and countries around the world that have capitalized on the innovation and experience of our Nova Scotia aquaculture pioneers. The flourishing salmon and mussel industries in New Brunswick and P.E.I. have a combined value of over $200 million and are prime examples of aquaculture success stories

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that were made possible by Nova Scotia's initial aquaculture development work, but also because of the strong commitment and leadership from their provincial governments.

With the declining value of the industry in Nova Scotia, it is evident that the government has still not made the commitment to fully encourage and support the development of this industry for rural Nova Scotia. With the downturn of the wild fishery around Nova Scotia, our coastal communities have faced severe hardship and have had to find other sources of income within their community in order to remain there. Aquaculture is a natural fit that complements the knowledge and skills of Nova Scotia's coastal rural communities' workforce and utilizes the rich resource of our coastline.

In January the Aquaculture Association of Nova Scotia held its annual Scotian Pride aquaculture conference at which the DFO Commissioner for Development of Aquaculture in Canada discussed his recently submitted report to the federal Minister of Fisheries and Oceans. In his discussion, he related that the aquaculture industry is the fastest-growing food sector in Canada. However, Nova Scotia is now seen to be the weakest link in the development of aquaculture in the country. With Nova Scotia's vast coastline and skilled fisheries workforce, this should not be allowed to continue.

Although aquaculture has had its prosperous beginnings in Nova Scotia, Nova Scotia has failed to capitalize on the potential of this industry for our province. Aquaculture is in no way seen as a replacement for the wild fishery, rather it's an integral piece of the coastal resource economy of added much-needed diversity that strengthens our communities. To develop the enormous potential of aquaculture in Nova Scotia the industry needs strong support and leadership of the provincial government to overcome such issues as site access, where the burdensome environmental assessment process is costing the industry up to $200,000 for one site and taking as long as three years for approval.

Nova Scotia needs aquaculture and the industry needs a strong provincial government to support its development in our rural communities. Mr. Minister, my question is, how did we go from a province that was leading the pack in aquaculture to falling behind our regional and provincial neighbours, and why did this happen?

MR. D'ENTREMONT: Well, let's go back a few years. You're quite right, we were a leader in aquaculture because we were some of the first people to come out with it and get it going. We have had a number of setbacks within this industry, whether it be unable to grow the fish out, because of super chills or whatever. The access to capital piece has been a great big deterrent to the growth of this industry. Regular banking institutions now have a problem with bringing up money for finfish operations or what have you. So there's definitely an issue on access to capital. I know the Fisheries Loan Board and Aquaculture Loan Board have a number of loans out there. We're still holding onto them, hoping that someday there will be a boom in aquaculture again.

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If you look at what happened here, as we went on in time and as the federal government decided to keep their finger in aquaculture, we did see a lot of regulations in view of environmental monitoring, environmental impacts and what have you on this industry. You're quite right, it takes almost two years for an aquaculturist to get that environmental document done and to finally put it through approval. We as a department feel that's completely unacceptable. We also fall into a problem where we as a department are regulators as well as marketers for purveyors of aquaculture, sometimes those two things clash.

So right now, we find that we're spending way more time on the regulation piece, in trying to help the industry get through the hurdles that are sometimes put up, whether it be by communities, whether it be by the federal government or whether it be by some of our own environmental rules and regulations. We sort of ran out of time to invest in the actual promotion of that industry.

I think recently the association has been an association that's been a little bit in limbo. I think this year, from their conference, there's definitely a new vigour in how they want to address some of the issues within the industry. I think we're there to help them along and provide them with the resources required in order to do that, while we can start focusing a little more on the regulation to try to streamline some of those roadblocks that are in the way right now. Ultimately, if you want to talk about red tape, red tape is abundant in that system. We as a department are trying to get rid of some of that red tape, at the same time our own red tape but also trying to address the red tape put up by the federal government as well.

MR. THERIAULT: Why has the province stopped the loan guarantees for the aquaculture industry, to the financial institutes?

MR. D'ENTREMONT: I think it's just the risk, the risk ended up getting out of hand. There was enough default on the loans that I think we probably made a conscious decision to come off that. I would have to get more information on that, because I'm not abreast of the current situation in regard to loan guarantees. There's also an accounting problem with doing some of those things, too.

MR. THERIAULT: So what we have to do in this province is deal with these risks?

MR. D'ENTREMONT: Deal with the risks, find the correct capital investment opportunities for aquaculturists. There are three things we need to do. We need to get through the red tape. We still need to be stewards of the environment and still be able to show the impacts or the lack of impacts of particular sites. We also need to streamline that siting process. Maybe that might be the department having to go out, like they're doing in the pilot project in Guysborough County, pre-approving some sites, and then finding aquaculturists who want to use those sites, rather than doing it a little backwards where an aquaculturist says, okay, I want to maybe try here, here and here and then try to find the best place. So

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there's a lot of time required in siting these places now, as we move along here. So there are a number of things, I think, we need to do in that industry.

MR. THERIAULT: I would like to touch on the boat building, too. Nova Scotia's boat-building industry continues to make its case as an increasingly important contributor to the economy. The most recent evidence comes from the just-completed study that shows total sales and spinoffs at $205 million in the year 2002. Researchers at Halifax-based Canmac Economics found that for every $1 million of boat-building output, nine direct jobs are created or maintained and 16 spinoff-related jobs are supported for a total of 25 jobs per $1 million output. The study also reveals the industry's $15.7 million contribution to the tax base. The provincial government receives $7.1 million in taxes from the boat-building industry. The Nova Scotia Boat Builders Association commissioned a fiscal review impact study. It involved an evaluation of statistics collected by the NSBA, plus confirmation interviews with three boat builders.

The study reveals boat building as a strong, vibrant sector. It's high growth rate, based largely on increased export sales, indicates its growing importance to the provincial economy. The results are good news for the Nova Scotia Boat Builders Association. The sector-wide organization, whose membership includes 35 full-time professional boat yards, 47 marine support industries, is looking for $3 million from the government to help continue to work the association over the next five years. Government's investment in the NSBA over the past five years has been $1.5 million. Industry investment has been $1.2 million over the same period. The NSBA was established in 1998 to expand the focus of the industry from producing fishing boats for the domestic market to building custom and semi-custom pleasure boats, as well as fishing boats for export.

Since 1998, the number of boat-building jobs, which offer good wages for skilled workers in coastal and rural areas, has grown from 550 to 880, while total sales have climbed from $5 million to $80 million, of which $35 million comes from export sales. Support industry jobs have jumped to 740 from 520 in 1998. The question is, if this is such a growing and vibrant sector of the economy, especially in cash-strapped, employment-hungry rural coastal areas, why doesn't the government have a responsibility to nurture and help this industry grow more?

[6:45 p.m.]

MR. D'ENTREMONT: Well this industry is one . . .

MR. THERIAULT: They're asking for more money and you won't help the association.

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MR. D'ENTREMONT: I haven't received a request from the association that I've seen from the NSBA recently, their money through the EDA, I think, is coming to an end. They have been able to access the money through ACOA. The value of our boat-building industry has doubled in the recent years, even since I worked in that industry, the industry annual sales increased 60 per cent to about $80 million, the total exports increased threefold to $45 million, which is tremendous because if you look at the work the NSBA has done in training, I mean they offer a phenomenal training opportunity. They do these lunch sessions where you can go in and learn about FRP. You can go in and learn about wiring. You can go in and learn about whatever, so it's basically trying to give the skills to the workers that we have.

It's moreover the money required to fund the NSBA, what we need to do as government is try to provide the training opportunity to the people who want to do this. If I look at LeBlanc boat builders in my neck of the woods, they're constantly looking for people to work in that boat shop. I'm sure Herman Samson is the same thing up in Isle Madame. You can't find the people who want to do that job and have the capabilities to work in FRP, to work in cabinetry, to work in all of these other skills that are required in building a boat. I think we need to be focusing through the Nova Scotia Community College and other training opportunities to have that capability and those people in our communities. In this day and age you can't just take a guy off the street and put him in a boat shop. If you do that, and this is from my friends at LeBlanc boat builders, it takes about four years for a person to become proficient in boat building.

I think we have a number of issues around the boat-building industry, but I think the strong voice that the NSBA offers, it has done a tremendous amount of good and I stand here today and say that I'm in support of the NSBA and I'll do what I can for that industry.

MR. THERIAULT: We can bring them from Newfoundland. They can build boats.

MR. D'ENTREMONT: Not as good as we can.

MR. THERIAULT: Seals. I want to touch on the seals. Seals have become a great problem on the eastern-southern coast of Nova Scotia. They are a problem for the ground fishery which in turn has become a problem for the coastal communities and fish processing plants in that area. The population of grey seals has exploded from 30,000 to over 300,000 and is increasing rapidly. These animals are huge weighing 800 to 1,000 pounds each. The grey seals feed on local inshore fish species, estimated a daily consumption of 16.5 to 27.5 pounds. They found the diet to consist of flounder, sole, eel, cod, lobster, that equals 6.6 million pounds of fish every day. Do you have to wonder why the fishery isn't coming back on the eastern shore?

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A newly founded grey seal research and development society believes by culling and harvesting just 10,000 of these animals per year, it would help rebuild the suffering groundfish and lobster stocks in that area. It is believed by many in the industry that a controlled seal cull could have a beneficial effect on the fishery as well as producing an industry on its own. The question is, would this province be in favour of a controlled seal harvest or cull for the benefit of the herd and the fisheries and the affected coastal communities that's happened there?

MR. CHAIRMAN: If I could interrupt the honourable member, the question was already asked and answered before, but if the minister wants to answer again . . .

MR. D'ENTREMONT: I can give the simple answer to that one and it's yes. We've always been the purveyor and that we want to do this in a humane, professional and economically valuable manner and if someone as the Grey Seal Society can prove to us that this can be done in this manner, we're all for it.

MR. THERIAULT: It wasn't answered before because it wasn't specific about this society, Mr. Chairman. Don't you even think, Mr. Minister, that this harvest could be higher than the 10,000 that they propose?

MR. D'ENTREMONT: There's a bit of research, I think, that needs to be done and in their proposal for 10,000, even in the first year it's a fair amount lower than that, to see how you harvest these animals, because they are quite large, as you alluded to, we don't have ice floes that we can go get them on, and the issue of certain particular islands that they might be on that we might not have access to. So there's a whole bunch of issues that we need to research out to see it, and I think the original plan, they're asking for a couple thousand animals in the first year to do their research to see how it can be done, what kind of products can be produced, et cetera. So there's a fair amount of research still to be done on how to do these animals but the 10,000 piece, I think science will show what that number should be, and I don't know if 10,000 is it or not.

MR. THERIAULT: Just an observation on it for myself, this all seemed to happen, the seal explosion, the day DFO started taking fishermen off the water that had been there for 400 years, because I've watched it myself in the Bay of Fundy even growing there. The seals, it's out of balance. They have no predators. They have no competition anymore. I think we may try to put it back in balance a little bit. It could help our coastal communities quite a lot.

Now the clam harvesting. Clam harvesters in Nova Scotia are feeling threatened by the Department of Fisheries and Oceans and also the Nova Scotia Department of Fisheries. These people have been harvesting clams for generations and now feel that they are being pushed aside. They feel the Department of Fisheries doesn't want to deal with them anymore. It seems like the clam beaches on Nova Scotia are slowly coming under control by a very few, which is being supported by the federal and provincial departments. This needs correction before it gets out of hand and trouble starts. There are already signs of protest in the western

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parts of the province. All the harvesters want is to become partners in managing this resource they've so greatly depended on. This resource is worth a lot of revenue for this province. My question is, will the minister sit down with these people and talk to them as equal partners and address their concerns about this industry and where it's going into the future?

MR. D'ENTREMONT: Yes, I mean this hasn't come forward to me yet, I know we've been watching it and seeing what the issues are between the federal government and the clam diggers. There's an issue in regard to a few of our producers and I wouldn't mind sitting down and discussing that.

MR. THERIAULT: I believe that's all they're asking for. I know they've submitted harvesting plans for beaches to the Department of Fisheries and Oceans. I think that's what they're looking for. I think it needs to be set down around a table and discussed.

The fisheries, despite the gouging it recently has taken over the past years from all the industries, agri-food, mostly fish, accounts for the largest share of exports in this province at $1.4 billion; followed by both forestry and energy exports at just over $1 billion each; automotive exports, tires, at the end of year, $866 million; industrial goods were $530 million; and machinery and equipment, $284 million. Will the minister please tell me why Fisheries, which is so important to the economic well-being of Nova Scotia, doesn't have a portfolio of its own, away from Agriculture, which is equally important? How does Tourism get a portfolio of its own, but Fisheries does not? Can the minister please tell me why?

MR. D'ENTREMONT: If you look at the products that are produced from our fishermen and from our farmers, they're all food products. When we talk about the larger idea of food safety, food handling and the marketing of these products, they're identical. It's not until we get down into the trenches that things become different. That is why within the structure of the Department of Agriculture and Fisheries, there is a deputy minister, an assistant deputy minister, an Executive Director of Agriculture Services and an Executive Director of Fishery Services. So when it gets down to resource management and development, those are completely separate pieces of my department, but the food safety, the legislation, the marketing services are identical because they are food products, and that's why we believe that this department should remain as one.

MR. THERIAULT: Thank you, Mr. Minister. Mr. Chairman, I'd like to share the rest of my time with my colleague, the member for Richmond.

MR. CHAIRMAN: The honourable member for Richmond.

MR. MICHEL SAMSON: Mr. Minister, I just wanted to touch on an issue that was raised earlier, but I don't think we received the answer for what I was looking for. Last year your predecessor, much to my shock - and I was pleased at the same time - actually had the political will to place a restriction on the crab buyers' licences that said that they could not

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sell to Newfoundland or to Quebec, because of the restrictive practices they had. Is it your intention to maintain that same restriction for this coming fishing season?

MR. D'ENTREMONT: Yes.

MR. MICHEL SAMSON: Have those crab buyers' guidelines gone out yet? Every year they get their conditions - I think they're called conditions, I think that's how it's referred to. Have they gotten their conditions yet?

MR. D'ENTREMONT: I don't think they've gotten their conditions yet, but those conditions will remain the same.

MR. MICHEL SAMSON: Those conditions will remain the same as last year?

MR. D'ENTREMONT: Yes.

MR. MICHEL SAMSON: Have there been any discussions between your department and the Newfoundland Government or the Quebec Government on this issue to put an end to this?

MR. D'ENTREMONT: Yes. I know my executive director has brought that up, I've brought it up at meetings as well. It doesn't look like they want to change their policies, so we'll leave it in place.

MR. MICHEL SAMSON: Has there been any action on behalf of the department in regard to who's buying up these crab-processing licences?

MR. D'ENTREMONT: Not that I'm aware of.

MR. MICHEL SAMSON: The reason I raise that is because we all know that a number of Newfoundland companies have been coming into Nova Scotia. What they were doing prior to the restriction is buying it here and sending it back to Newfoundland to be processed at their plants. Fortunately that's been stopped. But there is no action as to looking at who was actually buying up these licences?

MR. D'ENTREMONT: If you make an application for a licence, they'll be looked at as anyone else.

MR. MICHEL SAMSON: Are you providing any new licences for processing, or is there a moratorium on those right now?

MR. D'ENTREMONT: I'm thinking there is, but I'm not sure. My executive director is not here to answer that.

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MR. MICHEL SAMSON: In your last few answers you keep referring to an executive director, who is this executive director?

MR. D'ENTREMONT: Greg Roach.

MR. MICHEL SAMSON: Okay, I didn't know that was his new title. Lobster-buying regulations, that's something that your predecessor, Mr. Fage, had brought in a number of years ago. There were discussions about it and everything. What is the status of that? Has there been any movement on that at all?

MR. D'ENTREMONT: We're still working towards new regulations that should be coming, I believe, in the Fall. There are some new regulations that need to be coming forward. By Fall they will be in place.

MR. MICHEL SAMSON: Are they the same regulations initially proposed by Minister Fage, when he was in the department?

MR. D'ENTREMONT: As far as I understand, yes.

MR. MICHEL SAMSON: The last I heard was that your department wasn't moving forward on those regulations. I'm sure you will be aware there was quite a bit of controversy around those regulations, and it was going to have a detrimental impact on the small lobster buyers because of the required amount of capacity that they were going to be required to be able to hold in their holding facilities in order to maintain their licences. Your statement today is that those same regulations are intended to be put through this Fall, is that correct? If that's the case, I can tell you right now (Interruptions)

The reason the issue hasn't been up for discussion is because there was a belief that the department wasn't proceeding with this. If that has changed, I think it's essential that the industry be aware that you are going forward with regulations this Fall.

MR. D'ENTREMONT: I think at this point, I know that regulations are coming forward, I'm not too sure if they're the same. I will get that information to you as soon as I can, and what the proposal is.

MR. MICHEL SAMSON: One of the other questions - your department used to provide, I believe, up to $10,000, it was in the form of a grant to help people building a wharf, people buying some form of fishing gear, in some cases. I'm not sure what the criteria were, but I remember the figure $10,000 being around and a number of people getting it. Is that still available, and if it is, what are the criteria for getting it?

MR. D'ENTREMONT: That hasn't been available in two years, I believe. But there was a provision there, it was up to $10,000 for wharves . . .

[Page 74]

MR. MICHEL SAMSON: What was the program called? It was just for wharves, was it?

MR. D'ENTREMONT: It was a technology program that we had within the department.

[7:00 p.m.]

MR. MICHEL SAMSON: And that's gone?

MR. D'ENTREMONT: And that's gone.

MR. MICHEL SAMSON: The federal government has been looking - I think my colleague here may have raised it - at the whole issue of trust agreements and the owner/operator issues with licences. There was a federal panel on that, I believe it was looking for presentations to be made to it. Did your department or anyone on behalf of your department make a presentation on the issue of trust agreements, and whether they're good, bad or not?

MR. D'ENTREMONT: We didn't make a presentation, but there were some correspondence that did go back and forth with the federal government. I know that it's been a topic of discussion with each minister, previously with Minister Thibeault and then with Minister Regan.

MR. MICHEL SAMSON: Has the province taken any position on the issue?

MR. D'ENTREMONT: My belief, on this one right now, is the department's position on this is that we're the reason it got on the discussion in the first place. We knew this was a concern of the industry, and our feeling on this is that it needs to be addressed in order for the long-term viability of our coastal communities.

MR. MICHEL SAMSON: That's a nice and good answer there, but you didn't really give me a position on that. Do you support trust agreements, or are you saying you do not support trust agreements?

MR. D'ENTREMONT: Right now, with trust agreements, when we can address the access to capital, the capital gains tax in the intergenerational transfer, then we can take a final look at what this means. Right now, I think there are too many issues surrounding trust agreements and how they work within the government to take an official stance on it.

MR. MICHEL SAMSON: So you don't have an official position on it.

MR. D'ENTREMONT: We don't have an official position.

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MR. MICHEL SAMSON: The Fisheries Loan Board still does not provide any sort of funding towards the purchase of an enterprise?

MR. D'ENTREMONT: No.

MR. MICHEL SAMSON: Any licences to be looked at, there is still no capital available to purchase those?

MR. D'ENTREMONT: For the licence?

MR. MICHEL SAMSON: For any licences.

MR. D'ENTREMONT: That's right.

MR. MICHEL SAMSON: The Fisheries Loan Board or, as far as you're aware, through any private financial institution?

MR. D'ENTREMONT: No. What it boils down to is that since it is a piece of paper that is owned by - the licence is owned by the federal government, it is a non-mortgageable item.

MR. MICHEL SAMSON: Is there any discussion amongst the Fisheries Loan Board to look at the possibility of starting to make funds available towards the purchase of fishing licences?

MR. D'ENTREMONT: Yes, there is.

MR. MICHEL SAMSON: And what is the nature of or how far along are those discussions?

MR. D'ENTREMONT: I'm not too sure at this point. I know there's been a discussion going on for quite some time now, in how to address this situation, but I don't think we've come up with any concrete answers for it yet.

MR. MICHEL SAMSON: Do you have any correspondence or anything that you could provide members of this committee, as to the nature of those discussions and some of the feedback that's been provided on the issue?

MR. D'ENTREMONT: If we do have it, I will try to make it available.

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MR. MICHEL SAMSON: I would appreciate that. Just going through your funding, I noticed through a couple of projects here that it seems you had one that was - you have AVC on Page 10 of the Supplement to the Public Accounts. You have here $25,000 to AVC Lobster Sciences Centre. What is AVC Lobster Sciences Centre?

MR. D'ENTREMONT: AVC Lobster Sciences Centre in Charlottetown, the $25,000 commitment, this amount represents payment for the Nova Scotia Department of Agriculture and Fisheries' contribution in support of the Lobster Sciences Centre. They do research on lobster, because we value the industry.

MR. MICHEL SAMSON: So your department does provide funding towards lobster research-type projects?

MR. D'ENTREMONT: That's right.

MR. MICHEL SAMSON: There is a lobster research project that's being formulated down at the Collège de l'Acadie campus in Petit-de-Grat. Is it safe to say that it is possible to put a request towards your department for funding for that project?

MR. D'ENTREMONT: That's right.

MR. MICHEL SAMSON: Very good, I'm glad to hear that. Recently there was a statement made up in northern New Brunswick, from the head of a crab fisheries group there that felt that Nova Scotia was actually getting a bigger portion of the crab share than what New Brunswick was getting, and wanted the federal government to immediately address that. Are you familiar with that statement? You're not familiar with that.

MR. D'ENTREMONT: No.

MR. MICHEL SAMSON: Well, the reason I raise that is because my response to that was I was curious whether this gentleman would be willing to ask the federal government to give Cape Breton and Nova Scotia its fair share of the shrimp fishery; New Brunswick fleets are coming off our coast and fishing off our waters and landing at our wharves. I just hope that if this is raised that the minister will be more prepared to fire that back at our colleagues over in New Brunswick.

MR. D'ENTREMONT: Absolutely.

MR. MICHEL SAMSON: Shifting quickly to Acadian Affairs, one of the issues - and I'm not sure if you're aware of this, but it was raised here in this House prior to your becoming minister - was that Service Nova Scotia and Municipal Relations, when it came to birth certificates, marriage certificates or even your driver's licence, it wasn't possible to have accents used on your name. So if you had an accent aigu, accent grave or people of either

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Oriental descent or Indian descent, who had different symbols around their names, it was impossible to have those added under our system. To your knowledge, is that still the same rule today, in 2004?

MR. D'ENTREMONT: It was my understanding that that was being corrected within the Department of Service Nova Scotia and Municipal Relations, I know that was being addressed. You might have to ask the minister, and I will follow that up.

MR. MICHEL SAMSON: I certainly hope so, because in 2004, if we can't put accents on people's names and properly spell them, I think that's an absolute disgrace. In fact, this was raised, I believe, four years ago, and if that hasn't been corrected yet, then shame on all of us, that that's still going on. I know I had a gentleman call me whose child was born and the birth certificate didn't even have the name spelled right. In this day and age when we can put a man on the moon, yet we can't put accents, I think that's gotten to the point that it's foolish.

Family reunions that are going to be taking place as part of the Acadian Congrès this year, how much money is the province putting towards the family reunions to help fund them?

MR. D'ENTREMONT: As far as I know, it's about $80,000 through a couple of different means, whether it be directly through our office or through the Department of Tourism, Culture and Heritage.

MR. MICHEL SAMSON: How is that made available? How can the families apply for that? The Samson family is having a reunion, how do we get hold of some of that $80,000? My colleague, Mr. McNeil, is going to be attending the Mombourquette reunion down in L'Ardoise, how do they access this money?

MR. D'ENTREMONT: That access was done through the Office of Tourism, Culture and Heritage.

MR. MICHEL SAMSON: They had to make a request through the Office of Tourism, Culture and Heritage?

MR. D'ENTREMONT: That's right.

MR. MICHEL SAMSON: So that $1,000 limit per family, is that where that money is coming from?

MR. D'ENTREMONT: That's right.

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MR. MICHEL SAMSON: It is coming from the provincial government. So you have $80,000, and that's just towards reunions. What about the rest of the Congrès, how much provincial money is going towards it?

MR. D'ENTREMONT: Just this year, there is $600,000 coming through the budget of Tourism, Culture and Heritage.

MR. MICHEL SAMSON: And that's in this year's budget?

MR. D'ENTREMONT: Last year there was $170,000.

MR. MICHEL SAMSON: It was $170,000 last year, and you're saying it's $600,000 this year?

MR. D'ENTREMONT: Yes.

MR. MICHEL SAMSON: So that's in the Tourism, Culture and Heritage numbers of the budget tabled just recently?

MR. D'ENTREMONT: Yes.

MR. MICHEL SAMSON: How much federal money is coming in for the Acadian Congrès, to the province?

MR. D'ENTREMONT: Matching funds of $600,000.

MR. MICHEL SAMSON: They're putting in $600,000?

MR. D'ENTREMONT: Correct.

MR. MICHEL SAMSON: Is there any more money, other than that?

MR. D'ENTREMONT: There are a number - I think they do have a project with ACOA as well, I'm not too sure what that number is.

MR. MICHEL SAMSON: Through ACOA?

MR. D'ENTREMONT: Yes.

MR. MICHEL SAMSON: And you're not aware of how much?

MR. D'ENTREMONT: I'm not aware of the amount.

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MR. MICHEL SAMSON: You've made some changes in the Department of Acadian Affairs. I believe, before, there was only an executive director, and there was really no staff. You now have staff. How many staff do you have?

MR. D'ENTREMONT: Right now there is an assistant to the director, there is a secretary/receptionist. In this year's budget, we're asking to increase that by two more people, which would be a communications person and a translator for the office and for government services in general.

MR. MICHEL SAMSON: Where is that funding . . .

MR. CHAIRMAN: Thank you very much. It's 7:10 p.m. (Interruptions)

We've reached our four hours of debate. We will come back tomorrow, after Question Period. The Liberal caucus still has 25 minutes, if they care to use it.

We stand adjourned at the present time.

Thank you very much, Mr. Minister; thank you very much, members of the respective caucuses.

[7:10 p.m. The subcommittee rose.]