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April 28, 2000
Supply Subcommittee
House Committees
Meeting topics: 
Subcommittee on Supply -- Fri., Apr. 28, 2000

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9:57 A.M.


Mr. David Hendsbee

MR. CHAIRMAN: I see that quorum has been achieved. I will call to order this meeting of the Subcommittee on Supply. This morning we will be starting with the estimates of the Department of Housing and Municipal Affairs.

Resolution E13 - Resolved that a sum not exceeding $88,663,000 be granted to the Lieutenant Governor to defray expenses in respect of the Department of Housing and Municipal Affairs, pursuant to the Estimate and the business plans of the Nova Scotia Housing Development Corporation and the Nova Scotia Municipal Finance Corporation be approved.

MR. CHAIRMAN: Mr. Minister, you may wish to bring some opening remarks and comments and introductions to the committee and also perhaps we could deal with the resolution of the Department of Labour at this time or perhaps do it at a later time, whatever your pleasure is.

HON. ANGUS MACISAAC: Thank you very much, Mr. Chairman. It is quite all right with me, if it is suitable for members of the committee, that we go from one department to the other. If they are prepared to put up with me without interruption, then I am certainly prepared to be present at the committee without interruption.

First of all, good morning to members of the committee. I want to begin by introducing those who will be assisting me during the discussion of the estimates. The Deputy Minister of Housing and Municipal Affairs is Brian Stonehouse and Brian is to my right; the Executive Director of Policy and Research is Laurel Russell and Laurel is to Brian Stonehouse's right; to my left is Louis deMontbrun who is Director of Financial Services; and the Manager of Financial Services is Kathy Smith.


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[10:00 a.m.]

Mr. Chairman, I will have a few opening remarks which will perhaps highlight some of the activities of the Department of Housing and Municipal Affairs and point some direction with respect to where we plan to move in the period of the next year and, indeed, beyond that. I am looking forward to answering questions on the budget estimates and I know that when I did this last time I found it to be a rather interesting experience. It certainly assisted me in getting to learn a great deal more about the department for which I have responsibility and I expect that this exercise will enable me to learn even more.

Housing and Municipal Affairs supports communities, and the department fosters strong municipalities with information and advice and with financial support. We also provide property assessment data to municipalities and over 530,000 property owners every year. Municipalities use that assessment role for levying property taxes, which are the foundation of municipal finances. The department supports the provision and maintenance of safe affordable housing. We operate more than 12,000 social housing units for senior citizens and other Nova Scotians in need. Last year, we helped more than 2,500 families to make essential repairs to their homes.

The department provides a vast array of geographic information and property registration services. We operate Registry of Deeds offices in every county, from one end of the province to the other.

Like every government department, Housing and Municipal Affairs has wrestled with a significant challenge. Our budget this fiscal year is about $15 million smaller than last, and like every other department, we have taken a hard look at what we do. We have examined each program and asked if it is providing good value to the taxpayer. We have searched for ways of becoming more efficient, we look for ways of improving service while trimming costs. We made some tough decisions, but I think we have succeeded in protecting the services that are most important to Nova Scotians.

In social housing, for instance, we will save more than $3 million this year by streamlining our regional services. We are working very closely with our seven regional housing authorities to reduce overhead and improve efficiencies. The saving will be achieved without a loss of service to social housing tenants. In fact, many of our tenants will be noticing improvements before too long. We are in the throes of developing a long-range plan for maintaining, modernizing and upgrading our public housing facilities. That plan is being built on the findings of a consultant's report that we have recently received on the condition of our social housing properties. We are developing that plan now and we are making sure we can pay for upgrades by holding the line on maintenance and capital improvement funding.

We have maintained funding levels for our provincial home repair programs and will spend $9 million through the Residential Rehabilitation Assistance Program. We are

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continuing to work with other government and community organizations to meet the changing housing needs of seniors and homeless.

About one month ago I had the pleasure of participating in a ground-breaking ceremony for a housing development for hard-to-house people in the Creighton-Gerrish area of metro. The department invested a small amount of capital assistance and provided a loan guarantee. It is a wonderful example of government supporting grass-roots community initiative and I invited other community groups throughout the province to come forward with more projects like that one.

Let me bring your attention to another area of savings, the grant in lieu of machinery and equipment taxes program. The provincial government has been paying machinery and equipment taxes to municipalities on behalf of established companies since 1996. In this fiscal environment, the taxpayer can no longer afford this subsidy. The elimination of this program will save government about $5 million this year alone; more than $10 million over the next four years. I am sure you will agree that this is a significant savings, but it will be a relatively minor cost to the vast majority of companies. Of the 750 eligible businesses, 600 would have received less than $1,000 benefits this year. This small tax burden will diminish, then completely disappear within the next four years.I should also mention that we are proposing a legislative amendment that would give municipalities the option to waive this tax for companies in their area.

Although we have made a $200,000 reduction in our land information services division, we will continue to serve property owners in Registry of Deeds offices in each and every county. Our major initiative, Registry 2000, continues to move forward. It is attracting a tremendous amount of support from the professionals involved in buying and selling land in Nova Scotia. Our land registry system has remained virtually untouched since 1750; after 250 years, it is time for a change. Our service to municipalities will continue with relatively minor reductions. The roles and responsiblities review continues to progress. The project has moved from the information gathering phase to the more challenging phase, implementation.

I would like to acknowledge the dedicated efforts of the people who have been involved in this intricate business, particularly the municipal representatives. We are preparing for discussions with our federal counterparts on a new infrastructure agreement. We have already had preliminary discussions and we have preserved the capital funding we will need to participate in a new agreement.

Mr. Chairman, I would like to conclude my opening remarks by bringing your attention to a project that I think should be pleasing to us all. Government has committed $1.2 million to help make community facilities more accessible to all Nova Scotians. The Accessibility Program will be funded at $300,000 a year over the next four years. That is almost double the money that had been committed before the program analysis and options exercise. This program will provide small grants for wheelchair ramps, accessible washrooms,

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audio loops for the hearing impaired and other infrastructure improvements in community buildings throughout the province. We have been working with a number of community groups over the past few months to develope a program that all can support, and we are pretty confident that we have that support in spades.

Mr. Chairman, that concludes my opening comments and I certainly look forward to the discussion with committee members.

MR. CHAIRMAN: Thank you very much minister.

The honourable member for Cape Breton East.

MR. DAVID WILSON: Thank you, Mr. Chairman and Mr. Minister. It is my understanding that the overall budget of Housing and Municipal Affairs has been significantly reduced by 13 per cent. Am I in the right ballpark?

MR. MACISAAC: I believe you are reasonably close with that percentage number.

MR. WILSON: Where exactly will those losses be felt most by your department?

MR. MACISAAC: For this fiscal year, we have set up a payable in 1999-2000 to cover outstanding future liabilities under Debt Service Program. That was an amount of $1.95 million and as I indicated in my opening remarks, we will be terminating the grant in lieu of machinery and equipmant program and that is $5.1 million. We are reducing funding for land records reform initiative by $200,000; we are reducing funding for public non-profit housing administration by $3 million; we have reduced other grants, special project funding by $400,000; we have reduced the Provincial Capital Assistance Program funding by $1.2 million; and we have eliminated 41.5 full-time positions for a saving of $1.56 million.

MR. WILSON: The funded staff has been decreased from 482 to 494, is that correct?

MR. MACISAAC: In 1998-99 we had 525.5 full-time equivalents, and the estimate for 2000-01 is 481.7 full-time equivalents.

MR. WILSON: I was rounding it off to 482, so I am in the right ballpark. Are those lay-offs, are they losses that we made up through attrition or how did they come about?

MR. MACISAAC: Over the period of the last year, we were in a mode where we were attempting to save money, so there were a number of positions that we did not fill. These were positions that were within the department. So these positions are being eliminated. There were approximately 24 vacancies in that number. Others will be achieved through attrition, and it is difficult to give you a precise number at this juncture, as you can appreciate that people need to weigh their options and make decisions with respect to their

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future. We have done an estimate, obviously, of that, but to know precisely how it will be taken up, we will have to wait and see. It is our hope that the degree of dislocation that will occur will be minimal.

MR. WILSON: Are you telling me that there will be lay-offs?

MR. MACISAAC: Optimistically, I would like to say no, but I can't make that as a guarantee at this stage because it will very much depend on how people react and make their decisions.

MR. WILSON: So there is a possibility?

MR. MACISAAC: There is a possibility. It will be minimal.

MR. WILSON: Where will the bulk of those positions be lost?

MR. MACISAAC: I guess the largest section would be in the Assessment Services division.

MR. WILSON: I will return to the Assessment Services division on that question. If you look on Page 14.4 of the estimates, Municipal Services, it indicates the budget is losing some $7 million. Is that correct?

MR. MACISAAC: In 1999-2000, we have $46.4 million, and the estimate is $39 million, so your number is correct.

MR. WILSON: What services are being lost, and how do you foresee that affecting municipalities?

MR. MACISAAC: The two major items that are involved here are the $5.1 million that I referred to earlier, the plant machinery and equipment, the termination of that program. Of the $1.9 million, which is the Capital Debt Servicing Fund - staff is listening carefully to make sure I am using the correct words here - we prepaid the debts that were there. As a result of prepaying those debts, there is a reduction in the future and that goes forward. That accounts for the bulk of that money. There were three full-time positions also involved in that.

MR. WILSON: On Page 14.5, under the Land Information Services budget, it was increased $10.648 million from $10.145. I guess just to keep it simple, why is that increase there?

MR. MACISAAC: Actually, the estimate of 1999-2000 was $11.348 million, and the estimate for 2000-01 was $10.6 million, but as you indicate from the forecast it is $10.1 million is what the forecast expenditure will be, which is below the estimate number. The

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Registry 2000 project we are working on is starting up a bit slower than we had anticipated and, therefore, the amount of money that would be required by that program will be lessened in the next year. (Interruption) Okay, I am sorry. That resulted in the forecast being below the estimate for the current year, and for next year, because we hope to proceed with the Registry 2000 project, then we will need additional funds in order to move forward with that project. That accounts for the increase.

MR. WILSON: That is the sole reason for the increase is it?

MR. MACISAAC: I believe that accounts for pretty much all of it. Again, in terms of estimate to estimate, it is a reduction.

MR. WILSON: I skipped over when we were talking about the cost of Assessment Services, which will now be the responsibilities of municipalities, correct?

MR. MACISAAC: What we have done is we have indicated to the municipal units that it is our intention to recover the cost of providing that service. It is a service that is in the vicinity of $12 million, with one exception, we are the only province in Canada that does not recover the cost of assessment from clients, the people who use that service. What we have indicated is we have given the 12-month notice that is required with respect to this, and is in the future, not this year but the next year, we will move to a mode of recovering that cost from those who use the service. It places a value on that service. We anticipate working very closely with the municipal units as they prepare to take up this change and respond to the change. We will be moving forward, there will be full and complete consultation with the municipal units with respect to this. To use the term that the municipal units will be taking over assessment, that does not correctly describe what our plans are with respect to that service. It is a cost-recovery exercise as opposed to a takeover of the assessment service.

MR. WILSON: What are your department's plans to seek that full cost recovery from municipalities? How are you going to implement that?

MR. MACISAAC: Well, that is why we want to consult with the municipal units because there are various options with respect to how that may occur. We would want to gain their input so we can come to, if possible, a mutual understanding with respect to how that cost recovery should occur.

MR. WILSON: Mr. Minister, you don't consider that to be downloading?

MR. MACISAAC: Well, we consider it to be a cost recovery. It is a payment for service, and it is totally consistent with what is done throughout the rest of Canada. I can point out to you that we have, in fact, heard from the UNSM, and they are wanting to set up a joint committee with respect to exploring this and preparing for this change.

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MR. WILSON: You don't consider that to be downloading?

MR. MACISAAC: It is interesting that the number is almost equal to the amount of upload that we have taken with respect to the Community Services; $11 million. There has to be, throughout the piece, some sort of balance occur with respect to the relations between the province and the municipal units.

MR. WILSON: I am not going to ask it again, save you the trouble. Let's get back to Page 14.7 of the estimates. It indicates that Housing Services spent only $269,000 in 1999-2000, which is down considerably, as you can see from 1998-99, and this year the estimate is just over $1 million. There is kind of a wild fluctuation on that program. Is it because of the nature there, of federal-provincial agreements? Is that what is happening?

MR. MACISAAC: I believe the numbers you have are net numbers with respect to the operation. They don't reflect the recoveries that we receive for the housing services that we provide. These recoveries come through the federal government. For instance, a flow of funding through the federal government, they come from recoveries with respect to land sales. These numbers are not consistent from year to year, so the net you are looking at with respect to housing services is not consistent. Perhaps what I could do is share with you the fact that the gross in 1999-2000, the estimate was $5.7 million, and the forecast 1999-2000 is $5.3 million. This year, the estimate of the gross expenditure will be $5.3 million. So in essence, the gross figure does not change in that regard.

MR. WILSON: On Page 14.8, Housing Subsidies have been cut to about $12 million from $16 million approximately. Why?

MR. MACISAAC: There is a reduction of the $3 million, which I referenced in my opening remarks. If you look at the forecast expenditure for 1999-2000; $16.6 million, and the estimate is down to $12.3 million. One of the things that is happening there is an adjustment. The housing authorities had a 15-month year in 1999-2000 because they shifted the year to be consistent with our fiscal year, and because of that 15-month figure, their number had increased. So there is an adjustment there that is not consistent. It is perhaps more accurate to consider the estimate in terms of understanding what is happening. The estimate from 1999-2000 to the estimate of 2000-01, that change reflects the previous number that I referred to in my opening remarks.

MR. WILSON: On the same page, Capital Grants, also reduced. Again, why?

MR. MACISAAC: The reduction there reflects the reduction to the PCAP program.

MR. WILSON: Would you explain that please.

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MR. MACISAAC: The Provincial Capital Assistance Program, we have reduced $1.2 million in that program.

MR. WILSON: On Page 14.9 there is no mention of the Canada-Nova Scotia Infrastructure Works Program. If a federal program is implemented, will the government be there to pick up a share of that program?

MR. MACISAAC: It is our intention to do that, yes.

MR. WILSON: The Residential Rehabilitation Assistance Program, the RAP program as it is commonly referred to, and I am sure you will agree that has been very important to households in need of essential repairs. Is that program going to see increased funding? How do you see and do you believe that program can be delivered more effectively?

MR. MACISAAC: If you will note in the estimate from 1999-2000, we are going from just over $1 million to $2.1 million. What I need to explain to you here is that there are numbers that are chargeable to other governments, mostly the federal government. Again, it is a case of where those numbers are inconsistent from one period of time to another. For instance, the gross expenditure under the program, I should give you that first because that is the number that represents the level of service that is being provided. The gross expenditure is an expenditure of $9 million. We will have recoveries to other governments of $6.85 million which means that our total net expenditure by the province is $2.15 million, but the number is up significantly from the estimate. We are going from an estimate of $4.1 million in 1999-2000 up to a gross expenditure of $9 million in 2000-01.

I should give credit where credit is due here, Mr. Chairman. The federal government has doubled their contribution to this program and we have also increased our contribution to it as well.

[10:30 a.m.]

MR. WILSON: When I asked the original question, I asked if it is being delivered effectively, in your opinion?

MR. MACISAAC: Yes, we are reasonably confident with the delivery. That is not to say we are not looking for ways of improving the delivery of service all the time. All of our people are very keen to be responding to opportunities to improve services, but we are quite confident that the service that is being delivered is effective.

MR. WILSON: Mr. Minister, your department provides assistance, as you said, to seven regional housing authorities?


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MR. WILSON: Which, to summarize, is for the purpose of providing both low income and seniors' housing. My next question would be, is your department considering the privatization in any way, shape or form of the delivery of social housing?

MR. MACISAAC: No. Could I go back to point out that the service you were referring to with respect to the Residential Rehabilitation Assistance Program, that is delivered through our regional offices and the approval takes place at those offices so that the turnaround is as quick as possible. When you make application, the people who you are talking to are the people who will be making the decisions with respect to your applications.

MR. WILSON: The reason I asked the privatization question, and I am sure I am not lecturing you here, I am sure you are quite aware of the fact of how important social housing is in this province, but especially to areas such as I represent in Cape Breton. There are an extremely large number of clients I would take it and I would assume, as a matter of fact I would know, in the region where I come from and in Cape Breton, in particular. I guess what I am asking is what is your department going to do to ensure that low cost housing is going to be available for those in need, not only in Cape Breton, but throughout the province?

MR. MACISAAC: We intend to continue with the programs that we are offering and we are endeavouring to improve the delivery of those programs whenever possible. For instance, we recently received a report which has done an analysis of our total housing stock throughout the province and it has looked, in detail, at the state of that public housing and it has made recommendations to us with respect to how we can improve that stock through maintenance and through operations. That is going to be of great assistance to us as we move forward and develop plans to improve the housing stock that we have.

One of the great challenges, of course, is to ensure that the housing stock we have is properly maintained throughout the province and that it will remain in good condition for the future because, obviously, we have a real need in order to preserve our housing because of changing demographics. We also will be and intend to work very closely with other government departments to ensure that, when necessary, we are making the necessary adaptations to the housing stock so we can continue to serve clients as their needs change over time as a result of their changing circumstance, which is primarily the circumstance of aging. We are very keenly aware of the fact that this public housing stock is going to be essential for the future of the province and it is our intention to ensure that the level of service we are providing is capable of meeting the future needs of Nova Scotians as we move forward.

MR. WILSON: The reason I brought that up, and I can appreciate your answer, but if you look at Page 14.5 of the Supplementary Detail, approximately one-half, or $4 million, from public housing subsidies has been cut.

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MR. MACISAAC: That is the $3 million item we referred to earlier and we do not anticipate that that decrease will affect in any way the level of service that is being provided to our clients.

MR. WILSON: Maybe you could explain for me and for the committee how you can make that drastic a cut and not have it affect your level of service?

MR. MACISAAC: In total, in terms of everything we spend, it represents about 3 per cent of the total expenditures. We do not anticipate any change in the level of service to our clients, and in terms of our overall expenditure in Housing, it is a very modest reduction of 3 per cent.

MR. WILSON: During the lock-up for the budget our staff was told that that cut would come completely from administration. Is that correct?

MR. MACISAAC: Administration operations, yes.

MR. WILSON: I guess I am finding it hard to believe, Mr. Minister, that one-half of the line item is dedicated to administration, so I will ask you, what is your take on that reduction?

MR. MACISAAC: Again, to understand the numbers here, because we have the participation of the federal government, the numbers we present in the budget are net numbers with respect to the program and it does not reflect the gross numbers and the gross number with respect to the program is $120 million. So when we look at the reduction of $3 million, it is less than 3 per cent in terms of that total. So when we start talking about making savings with respect to administration you have to consider it in that context.

MR. WILSON: I made reference earlier to the fact that in places such as I represent in Cape Breton, public housing is more important than ever and I understand what you are telling me about the numbers and so on, but I think it still translates into a cut, does it not? I am having difficulty here understanding, is this a cut or isn't it a cut?

MR. MACISAAC: It is a reduction in number so . . .

MR. WILSON: And that, to me, is a cut. Is that correct?

MR. MACISAAC: You can use whatever words you wish to describe that. However, we need to put it in context and one of the things that we are attempting to do is to become more efficient in the delivery of our service. If we can become more efficient, then we can save money and we are saving money by being more efficient, $3 million. That is the essence of what it is that we are doing here.

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MR. WILSON: That is a rather large subsidy. For your sake, Mr. Minister, I will say reduction instead of cut. Is that not rather large? Would you consider that . . .

MR. MACISAAC: Again, I would bring you back to the gross numbers and the gross number that we are talking about, because of the federal involvement, is $120 million. So if you look at the $3 million in that context, I mean $3 million is big by anybody's standards, okay, but if we look at it in the context of the total program of $120 million, it is not as significant as it would appear by comparing it to our budget lines here.

MR. WILSON: So if the reduction, the cut, is solely through administration and that is correct, is it? It is solely through administration. Can you elaborate and give me some details on that?

MR. MACISAAC: Yes, when I say administration, it is the administration and operation, all of it. We are in the process of putting together a more efficient delivery mechanism. We are moving forward with that. I cannot tell you precisely what it will mean in every part of the province except to say that we will be delivering the service more efficiently than we have in the past and we will be able to achieve the reductions in that way.

MR. WILSON: Are you telling us that you are analyzing or has there been any kind of impact analysis or a cost benefit analysis with regard to that reduction?

MR. MACISAAC: We are currently working with the housing authorities, for instance, to work with them as they prepare their budgets and to achieve these efficiencies. It is a process that is ongoing and it is happening with the housing authorities.

MR. WILSON: And you are confident, Mr. Minister, and I will give you the benefit of the doubt, taking the federal numbers into consideration and the big picture so to speak, that the level of service your department has been providing will not be affected in any way?

MR. MACISAAC: I am confident that we will not negatively impact the level of service, yes.

MR. WILSON: I would like to get back, if I could, to the cost of assessment services which will now be the responsibility of municipalities. I don't mean to be repetitive, but if you would, would you again explain that to me, please, Mr. Minister, as to what that is going to mean exactly for municipalities?

MR. MACISAAC: The reason I am hesitating is because I cannot explain exactly because we are going to enter into discussions with the municipal units and, as I indicated earlier, the UNSM has requested that we put together a group to work on this change. So for me to speculate with respect to the conclusions that might be achieved by that group would

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perhaps be premature at this stage. I would not want to preclude any conclusions that that group may achieve as a result of their discussions and their planning.

The essence of what it is that we are doing is that we are placing a value on a service that is being provided to clients in the province and we are saying that we will recover the cost of that service from the clients. How the clients, in consultation with ourselves, will decide to effect that cost recovery is something that remains to be determined.

MR. WILSON: I understand there will also be amendments to the Assessment Act, is that correct?

MR. MACISAAC: There are amendments before the House at the moment, yes.

MR. WILSON: What do they cover? Give me, if you would, please, an overview of that.

MR. MACISAAC: Currently and, again, I would ask my staff to listen carefully to make sure I am precise in what I am saying, currently the railroads in the province pay tax as if they were assessed, but there is no legal requirement for that to occur and what we are doing with the amendment is putting in place the law that requires that to happen. We are also placing aquaculture operations in the same category as resource operations such as farming and forestry. So that is a recognition of aquaculture as a legitimate resource activity.

I recognize that there is a whole debate out there with respect to the future of aquaculture, the level of activity that should take place, where it should occur and what some of the consequences of that are. That is not a question for the Assessment Services Division to determine, but it is a question for us to recognize aquaculture as a resource activity and all of the other things that need to take place with respect to that activity will be put in place by other people, but given that we will have an aquaculture industry in the province, then we are saying that that should be categorized as a resource activity. (Interruption)

Yes, the other matter is a matter pertaining to conflict of interest and Assessment Services employees are in a rather unique situation with respect to information that is available to them in the course of their work and the extent to which municipal units sometimes have conflicting interests, or perhaps to express it in a more positive way, are competitive with respect to one another in terms of objectives that they would like to achieve. A person working in the Assessment Services Division can have access to information in other municipal units that would possibly give them information that would not allow the two municipal units to be on a level playing field. So that is a situation which is unfortunate in the sense that it requires us to react to this category of employees and to say that there is a problem with your participation in municipal government.

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The amendment that we brought forward is one which we have, in fact, looked at and said perhaps it is possibly too all-encompassing and so we have gone back and we have looked at it again and we have said perhaps we can come at this from another direction. So what we are doing, instead of prohibiting people working in the Assessment Division from being involved in municipal politics, we are saying or proposing that should you desire to become involved in municipal politics - the Legislature will make its final analysis on that - that if you wish to become involved, you seek from the Conflict of Interest Commissioner a determination as to whether or not you would be in a conflict of interest situation should you succeed in being elected to a municipal government. That provides an opportunity for an assessment of the type of work being done by the assessor to see whether or not there is the possibility of a conflict of interest.

I might point out that one of the reasons that we felt necessary to come forward with this legislation is that there is an opinion from the Conflict of Interest Commissioner which suggests that there is, in fact, a real conflict of interest with an assessor being in municipal government. So, anyway, that is where we are with respect to that. There are other changes in that Act if you would want me to just take a few moments and I could go through them.

MR. WILSON: I don't want you to waste all my time, Mr. Minister, but you can take a few moments, sure.

MR. MACISAAC: Well, I mean you asked the question and I can give you a short answer or a long answer.

MR. WILSON: I will take the short one.

MR. MACISAAC: There is another provision where farm property owned by a resident of a province is exempt from taxation and this amendment would be a benefit to the municipal units and the resident taxpayers who would not have to share the burden imposed by these exemptions. Another feature, and perhaps I will just highlight some of these, is that one part of the Act would enable the Director of Assessment to correct errors in assessment accounts during the course of the year. This is not to be confused with appeals, but when an error has been identified, then a correction can be made. I have an example in mind. I just want to confirm that it is a correct example.

I am reminded that under the Act now there is a limited time period in which you can correct an error and what this does is remove that time period and allows you to correct an error at any time throughout the course of the year. That is a recognition that indeed, you know, errors are made and when it is an error, then the assessment should be able to be adjusted in order to correct that situation.

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Another provision is that the Regional Assessment Appeal Court may sit at a place determined by the Minister of Housing and Municipal Affairs or a place agreed to by all parties of the appeal. So it is a convenience factor for people involved in the appeal process and it should not only provide for convenience, but there should be a savings in cost and time for people involved in the process. An awful lot of the others are really housekeeping matters. I would be certainly glad to discuss them with you, but those were the highlights, if you like, of the changes and I am conscious of the fact that the member's time is limited and if he does not have further questions, I will complete my answer.

MR. WILSON: Thank you very much, I do. Mr. Chairman, how much time do I have left, please?

MR. CHAIRMAN: You have 11 minutes.

MR. WILSON: If you recall, I tabled a letter in the House earlier this week regarding a large number of programs and services that are going to be downloaded to municipalities. That letter - I have a copy here if you wish to see it - was from the President of the Union of Nova Scotia Municipalities, Mr. Duart MacAulay. I am just wondering, Mr. Minister, how do you reconcile with a promise that your government made not to download on municipalities when, indeed, this letter indicates that that is exactly what is going to happen?

MR. MACISAAC: Mr. Chairman, the letter fulfils the legal requirement to provide a 12 month notice of changes that will impact municipal units. What the letter does not address is the fact that there is an ongoing discussion with respect to the municipal units under the roles and responsibilities exercise and that exercise is one which is intended to take a real look at what is happening between the two levels of government and who should have responsibility for delivering what service. That is the process that is out there.

There are also other relations and other factors that are taking place. So while this fulfils the legal requirement with respect to changes for the municipal units, there are other processes taking place which may in the final analysis result in no significant change with respect to costs of municipal units relative to the province. I cannot predict precisely what is going to happen as a result of these discussions but, obviously, the discussions are taking place. So you cannot look at this letter and say that this categorically results in a downloading to the municipalities. It indicates under Section 519 of the Municipal Government Act what it is that we plan to do a year from now which would impact on municipal units. What it does not address is what we might do by way of reducing costs to municipalities, because there is no legal requirement to do that.

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[11:00 a.m.]

MR. WILSON: I am going to agree with you, Mr. Minister, that the Municipal Act is a good Act, I agree with you on that. It did require you to give a year's notice on proposed changes. I am very glad to see you are complying with the Act, but it doesn't in any way reconcile the actions of another document which I think you will probably be familiar with, which promised not to download to municipalities. Is that actually breaking a promise that was made by your government?


MR. WILSON: Can I ask you for a further explanation of that no, because that is certainly not a sufficient answer.

MR. MACISAAC: It is no in the sense that this letter does not reflect other things that may be happening, and it does not provide a net figure. It spells out what it is we plan do to with respect to changes to municipal units a year from now which would result in them having to spend more money. This letter does not address anything that might occur which would relieve municipal units of expenditures.

MR. WILSON: You are telling this committee that there is going to be something there to relieve the expenditures of municipalities a year from now?

MR. MACISAAC: I can't spell out precisely what will happen because we are involved in discussions with the municipalities and the roles and responsibilities. How that is going to play out in the final analysis, you and I could not predict at this time. Perhaps it would be fairer to say that a year from now you could look and see what the situation would be.

MR. WILSON: So you don't in any way, again I don't mean to be repetitive, see that as a broken promise by your government?

MR. MACISAAC: Well, no. I know you don't like short answers.

MR. WILSON: I only like them when I believe them.

MR. MACISAAC: For instance, we have a cost of $11 million that has been uploaded to the province this year from Community Services. That is a definite change. Nobody has to give notice that that is going to occur. So you can take this document and say it represents downloading to the municipalities, but the document is incomplete with respect to what may happen in the course of the coming year because the Municipal Government Act does not require us to say what it is we are going to upload to the province from the municipalities.

[Page 444]

MR. WILSON: I still have some time left, and I promised someone that I would ask a certain question, that had to do with the Town of Port Hawkesbury, which relies, I understand, on the Landrie Lake water utility. Is that correct? The question I have to ask is, are water rates there going to be increased?

MR. MACISAAC: It is actually the Department of the Environment that is operating the water utility that serves the Town of Port Hawkesbury. You are correct, it is Landrie Lake water utility. A 12-month notice has been provided to the town. Again, it is a matter of full cost recovery.

MR. WILSON: What is the increase there, please?

MR. MACISAAC: I have asked for that information. It wasn't sent to us. Hopefully I will have it later in the proceedings, if not, we would make it available to you following.

MR. WILSON: Thank you, Mr. Minister. Thank you, Mr. Chairman.

MR. CHAIRMAN: You do have two minutes left.

MR. WILSON: That is okay. My voice is starting to crack.

MR. CHAIRMAN: I just wish to advise the minister whenever there is any information to be requested or to be sent to one of the caucuses, it is to be sent to all caucuses. I want to make sure the distribution of information is given to all Parties. So that information in regard to Port Hawkesbury will be also provided to the NDP caucus and to the PC caucus. Thank you.

MR. MACISAAC: It is my understanding, just so we can be clear here, it has been our practice to send it to the Speaker's Office. That was our understanding of what we should do whenever we undertook to provide information, that it was given to the Speaker's Office, and it is accessed through the Speaker's Office.

MR. CHAIRMAN: Through the Speaker's Office and through my request as the Chairman, we have been asked, for practice, it be circulated to all three Parties.

MR. MACISAAC: That is fine if that is what you want.

MR. CHAIRMAN: Since the Liberal caucus has forfeited the last two minutes, I now pass the time over to the NDP caucus. The time is now 11:05 a.m.

The honourable member for Dartmouth North.

[Page 445]

MR. JERRY PYE: Thank you, Mr. Chairman. Once again, Mr. Minister, and to your staff, it is a pleasure to be before you to go through your budget estimates. I will be dealing primarily with the issue of your portfolio as Housing Minister. To me, I believe housing is the single most important issue facing Nova Scotia. I want to say I recognize that your government has done a study of Housing for Tomorrow: A New Direction in Provincial Housing, I also believe it is what you have put forward as a study, to look at housing in Nova Scotia. I find it most unfortunate, as a member of the Legislative Assembly, to sit in budget estimates knowing full well there are many Nova Scotians who live with sub-standard housing and sub-standard housing conditions, primarily with maybe no housing at all.

I know the minister has been fortunate enough to address the issue with those particular individuals who are homeless by opening up the new Metro Turning Point shelter on Barrington Street here in Halifax. I also know the minister made reference to a term of hard-to-house individuals in the official opening or sod turning ceremony with respect to Gerrish-Gottingen Street housing proposal, which, I believe, is one of the non-profit housing facilities that are going to come forward.

There is also a large group of Nova Scotians out there who have no way of ever dreaming to have homeownership. Those are Nova Scotians who are considered the working poor, and who often are living in apartments, and because they are the working poor have their income subsidized by the Department of Community Services. I don't know if the Minister of Housing has had communication with the Department of Community Services with respect to its role in directing or suggesting to the Minister of Housing to how best address the housing needs of those people on social assistance. The reason I say this, Mr. Minister, is because often I find people who are on social assistance living in rental units and units that take 50 per cent of their income.

I want you to know that it was less than 20 years that it was considered a travesty in this country to have to spend 25 per cent of your income for shelter. People today are now spending up to 50 per cent and 60 per cent of their income on shelter. To me, Mr. Minister, that reflects a very serious problem. It becomes a tremendous cost to government because the Department of Community Services, who cannot provide other programs because of the tremendous amount of dollars that are going into the shelter component of individuals on social services are being spent, and I think wisely being spent. If I can offer the minister, through his department and to other governmental agencies, a note to make note of that, that in fact, if we do provide decent affordable housing to Nova Scotians, what costs government on one hand would be a tremendous savings to government and a tremendous savings to Nova Scotians overall on the other.

Mr. Minister, I guess my difficulty lies with the notion that we live in a province with less than one million Nova Scotians. We live in a province that has an abundance of natural resources. We live in a province whereby lumber, and because the forestry is a natural industry, is available as a great resource and a lot of the Crown land is provincial Crown land

[Page 446]

and so on. Having said that, I am sure the government, with some direction from the private sector could very well initiate an affordable housing program to those Nova Scotians who find it out of their reach today.

It is ironic that even many Nova Scotians - and if you go around into communities, and you look at rural communities in particular, and even in major cities now, if you take a deep view of what is occurring not only in our rural areas but in our urban areas where people can no longer afford to maintain and keep their housing up to par simply because the cost of housing supplies have risen to such an extent that it is out of the reach of many of those Nova Scotians. I won't name any, but building suppliers, if you go to a number of building suppliers and you look at the stock they sell, you will find there are significant costs.

When I had the opportunity, which was a very striking and startling point to me, and it was brought to my attention through the Voluntary Planning committee that offered government direction in its support, and this is the most striking point, that 55 per cent of Nova Scotians earn an income of less than $20,000 a year. To me, that makes it extremely difficult for a good number of Nova Scotians to realize the dream of having a home of their own. I do know that the government, for the most part has addressed seniors housing in a way that has been comparable, but I don't know if it is consistent with the rate of senior growth or the escalation of the number of seniors who are becoming older in our province; I don't know if the government has addressed that. I will be going through the Department of Housing and Municipal Affairs annual report on housing for 1999, and I will be going through that to some extent, so Mr. Minister, you will be aware.

You indicated in your initial presentation to the estimates committee that you do have this ongoing assessment and analysis of the housing stock in Nova Scotia. You talked about the maintenance and operation of that housing stock, but you never told me what the future aspirations are with respect to your Department of Housing regarding housing stock and how that housing stock is going to be developed within the next three to five years. I do not have a copy of that report. I am wondering, Mr. Minister, if you can elaborate something about the new direction, where your Department of Housing is going with respect to some of the concerns I have expressed to you in my preamble.

MR. MACISAAC: Mr. Chairman, I want to thank the honourable member for his comments. He certainly does put his finger on concerns that are real and they are concerns that are faced by people in the province. As the member can appreciate, as a province, we have limited resources with respect to housing, and as I, in my response to the questions by the honourable member for Cape Breton East, indicated that in order to understand the budget we needed to look at the gross figures with respect to expenditure and housing. The reason we need to look at the gross figures is because of the participation of the federal government in the delivery of our housing programs. The reason I mention that, Mr. Chairman, is that it points to the need for us to have continued participation and increased

[Page 447]

participation by that level of government to assist in addressing many of the concerns that the honourable member alluded to.

I can say that we are in communication with the federal government. We are indicating to them that these needs exist, and these needs need to be addressed. We will continue to do that.

I want to put our situation in the proper context here because while we can talk about the gross figures in terms of the delivery of housing, we have to recognize that the provincial contribution, in essence, are delivering a program for which the federal government pays the bulk of the costs. So as we move forward and attempt to address future concerns, we must bear in mind the context in which we find ourselves with respect to funding. Now, I don't say that in the sense of a cop-out, and I don't think the honourable member would take it in that light because I think he understands the degree to which the federal government plays a role in the delivery of housing services. I say that up front with respect to the concerns which he has raised.

I can also indicate that one of the things we hope to do is to continue to address the changing needs of people who need housing, in particular seniors. We need to be able to adapt the stock of housing that we have to be able to change to their needs. We need to ensure the stock of housing we currently have is adequately and properly maintained, and that is the focus of what we are doing with respect to the housing stock that is there now. We also are very anxious to encourage seniors to remain in their own homes for as long as possible by assisting them with repairs and adaptations that need to be made to their homes in order to allow them to remain there for as long as possible, and that process is one which we are attempting to emphasize.

I appreciate the concerns the honourable member brings forward and I want to remind him that we are delivering a program, we are a very active participant, but for the most part in financial terms is funded by the federal government. So as we would look forward to increased demands, we must look forward in the context of the federal government having to be a major participant in addressing the needs that have been articulated by the honourable member.

MR. PYE: Mr. Minister, let's go to the federal government. I believe the federal government simply got out of the housing business altogether, other than to provide the provinces funding for residential rehabilitation programs. I think that comes from the federal government, you can correct me if I am wrong, but I think that is funding that is sent down to the provincial government and the provincial government has the responsibility to administer that program and to channel it out into the communities where it is needed; and a very much needed program.

[Page 448]

Mr. Minister, I remember when this program first came into force. As a matter of fact, it was in the 1970's when this Residential Rehabilitation Assistance Program came into force. It came into force by way of a Neighbourhood Improvement Program and it became the sister program to the Neighbourhood Improvement Program, to help and allow neighbourhoods to stabilize themselves. It was one of the best programs, I think, that was initiated by the Government of Canada. I don't know what government was in power at that time, nor do I care, I think it might have been a Pierre Elliott Trudeau Government in power. I do believe the program was a very successful and very useful program and maintained and stabilized neighbourhoods, and I was actively involved in the Neighbourhood Improvement Program.

Mr. Minister, maybe you will clarify to me what your statement was. You gave me the impression that the bulk of the funding money that is administered by the Department of Housing in the Province of Nova Scotia is funding that is coming down from the Government of Canada. That, in fact, gives me the impression that maybe the Government of Nova Scotia isn't spending much money at all, if any money.

MR. MACISAAC: I certainly did not intend to create that impression.

MR. PYE: Well, you will have the opportunity to clarify that. I want to know how much money came to the Province of Nova Scotia this year by way of the federal government for the Residential Rehabilitation Assistance Program, RRAP funding, and any other subsidies of housing money that may have come? I also know there would have been subsidies from the federal government with respect to co-op housing. I believe the Government of Canada, and it might have been in 1997 or earlier, got out of the co-op housing venture, I guess I should use that term, because it did play a very significant and important role, and co-op housing was a fundamental part of the housing stock in many municipalities across the country and not unlike any other part of the country, Nova Scotia had its share of co-op housing. I do know there was a lump-sum payment passed down to the Government of Nova Scotia at that time when the federal government, if I can use the term, washed its hands of co-op housing.

I am wondering, Mr. Minister, if you have access to that information and if that information can be provided to me as to when the Government of Canada opted out of co-op housing, passed it on as a responsibility to the provinces, and how much money had come down to the Province of Nova Scotia with respect to money for co-op housing. Also, if you can provide me with how much money was dispensed to the Province of Nova Scotia this year from the Government of Canada to co-op housing, and primarily to co-op housing?

MR. MACISAAC: Mr. Chairman, the date was 1997 and you correctly identified that date before.

MR. PYE: It happens to be in your report, Mr. Minister.

[Page 449]

MR. MACISAAC: Yes, I will confirm that the information in the report is indeed correct.

MR. PYE: Absolutely.

MR. MACISAAC: The amount of money, to give you the precise details of that, could we get back to you and provide you with that and give you the details of the dollars involved.

MR. PYE: Certainly, that is for the 1997 lump sum that came from the province.


MR. PYE: You are going to tell me about the rest of my question with respect to how much money came this year?

MR. MACISAAC: We will do the whole list of everything that you have asked in that question and we will provide it to you.

MR. PYE: As well as the Residential Rehabilitation Assistance Program funding?


MR. PYE: Thank you, Mr. Minister, that is fair. I want to continue on my train of thought with respect to co-op housing. I know your department heads are very much aware because I have had conversation with the manager of the Nova Scotia Department of Housing regarding the kind of difficulties that some of the co-op housing units are finding themselves in within the Province of Nova Scotia. I do know that CHF, the Co-operative Housing Foundation of Canada, has had a very good conversation with your department with respect to how best to alleviate the difficulties that many of the co-op housing units are finding themselves in.

There have been some suggestions with respect to how one can best address or identify the problems with respect to the management of co-op housing, which became a very important issue, because your department felt that maybe the structure of co-op housing, and the executive, has not lived up to its mandate and some of them, because they were smaller units, might be able to amalgamate into one larger unit so they could have a better understanding of the difficulties each of those co-op housing units are finding themselves in.

I am very partial to co-op housing simply because there are approximately four co-op housing units in the Dartmouth North constituency. One already, I believe, is no longer a part of the co-op housing stock and I do know there is a management company that comes in and manages the affairs of some troubled co-op housing units. Particularly, I am one who would

[Page 450]

like to see it go back to the residents who live in those co-op housing units and I am particularly one who would like to see your government and the department give a greater degree of direction to those individual co-op housing groups so they can bring themselves back on their feet and get a hold of their community, because it is a great community. The beauty of co-op housing, Mr. Minister, I don't have to educate you on this because you know, is that there is a mix and a blend of all individuals from social-economic backgrounds who live in this community and as a result of living in that kind of a community, help each other out by way of just socializing, in direction and education and the whole process.

Mr. Minister, and to your department heads, I am wondering where we have gone and what your government has done with respect to the difficulties that some of the co-op housing units now find themselves in.

[11:30 a.m.]

MR. MACISAAC: First of all, Mr. Chairman, I want to thank the honourable member for his comments on cooperative housing. I think it would be fair to say that it is an interest that both of us share keenly and I certainly appreciate the support that he advocates for cooperative housing. It is an extremely important element of the housing service that is delivered within the province and one which in an ideal world has tremendous potential with respect to providing services and looking after the needs of people within the province.

We have 95 cooperative units that are currently existing in the province. Some of those are what we could describe as in difficulty. There are others where we have a bit of concern with respect to the direction they are going and you correctly referred to the fact that there are management companies involved. This is not the ideal situation because it is contrary to the principles of the cooperative. Your reference to the varied background of people who are involved within the cooperative units is really the key to ensuring the long-term viability of those cooperatives. When you do an analysis of why cooperative units get in difficulty, the analysis will inevitably point to the fact that that variety of backgrounds and the variety of skills that are needed for the cooperative to carry on, and as you pointed out to carry on in a manner where people are helping one another, and the help of one another comes from the fact that they have different skills that they bring to the table.

That skill pool is one which enables the cooperative to move forward. You have people with good accounting background; you have people with good knowledge of construction, of building; you have people who have a good understanding of upkeep of the grounds outside of the building; you have people who understand, they have good leadership skills in terms of bringing people together, in terms of seeking out the skills. These are all the things that are necessary in order for a cooperative to be able to move forward and to achieve success and be able to provide a continued good level of housing to individuals. This is keenly recognized by the staff within the Department of Housing and Municipal Affairs.

[Page 451]

Last year I was here, I had a very short period of time with the department and was impressed with the skill level I saw there, but I have since come to appreciate that it is not only a skill level that exists within the department, but it is a real dedication to the principle of cooperative housing that exists, and they are dedicated to trying to ensure that we can address the concerns that are out there with respect to these units and they are working very closely with them. That is one aspect that is going on.

The other facet we are dealing with, of course, we are dealing with the national body, the Co-operative Housing Foundation, and we are working closely with them. I have met with them within the past month. We have met with them and we have a very good working relationship and we want to continue that working relationship. We certainly rely on their input and they have consulted with us with respect to future housing.

The other element we have to emphasize, and this is what I think needs considerable attention and it is something that is recognized by people within the department, and that is we need to ensure that existing cooperatives that are doing well remain keenly aware of the necessary mix they have to have with respect to those people who are part of the cooperative to ensure that they are able to continue to move forward and have the skills available in order to address the needs of a cooperative.

I certainly appreciate the comments you are making and I can tell you the department is very dedicated to cooperative housing. It is something that they feel strongly about, not just professionally, but they feel with respect to their hearts because they see this as being a very important vehicle with respect to the delivery of housing services and it is one which needs to be protected.

MR. PYE: Mr. Minister, I think you would acknowledge as well that it is certainly a significant cost saving to the Nova Scotia Government compared to subsidized housing and other forms of housing developments. I want to tell the minister, too, that I did have a meeting with representatives from the Co-operative Housing Foundation of Canada and I must say they did indicate that they have had a very good productive meeting with the Nova Scotia Department of Housing this time and, in fact, I will say this, they believe they were seriously listened to. They recognize there are problems within the housing co-op and you touched on it as well with respect to maintaining the skills that are needed to each of these cooperative units in order to continue to be viable and successful.

Some of that expertise and skill tends to leave the co-op housing units, where they once were a family member or a member of that community, and as a result of that often the vacancy isn't filled with another skilled individual and what happens is there is a general erosion of not having that expertise and, therefore, there is a breakdown in making sure the executive body continues to function as it should.

[Page 452]

So, Mr. Minister, I think I will say here today, from my conversation with them, that they were pleased and I would hope that that avenue continues to be a productive cooperative venture between you and the co-op housing unit.

MR. MACISAAC: Before you move on from that, I was reminded and I should have made this comment earlier, we are also working very closely with the local Co-operative Housing Foundation and we have sponsored training programs through that organization to assist in identifying the skills and enhancing the skills that would be available within co-operatives. That is a fairly important contribution with respect to these organizations.

MR. PYE: Thank you Mr. Minister. I regret not bringing that to your attention because I was advised that has happened through the department and that those training programs are in fact ongoing training programs and that is good to hear.

I don't know how much time I have . . .

MR. CHAIRMAN: You have 27 minutes.

MR. PYE: That is good. Then I can go on here with respect to other types of housing. Now, we have talked about co-op housing, and we have talked about non-profit housing. I guess what I am talking about is, has the provincial government simply because of the financial position the province finds itself in, maybe the Department of Housing does or maybe it does not, have you given consideration to some home ownership programs through the Department of Housing that will allow individuals to acquire their own homes? Particularly people who I referred to earlier in my opening statement with respect to the working poor and so on?

MR. MACISAAC: Thank you for the question and your patience in waiting. What we do have is the family modest mortgage program which provides up to 100 per cent mortgages for low income individuals or low income families and there are subsidies as well associated with that program. If you would like to get the details of how that has been accessed, we can provide those for you as well. That program is one which we are maintaining and we would like to see more uptake on that particular program.

MR. PYE: I would greatly appreciate if there are any brochures, information on this particular modest housing program, that could be sent to my constituency office so that I can inform people, particularly individuals who come to my constituency office, who come seeking advice on how they can become homeowners and so on and living on modest incomes. I think it is very important that we are able to provide them with as much information as possible with respect to these programs.

[Page 453]

I am sure that this program would also have a ceiling so if there were x number of dollars allocated to it for a year and that those dollars - and I don't know the dollars, but I am sure that you are going to tell me - and I guess I don't know if there is an evaluation process? If a number of applicants are making application for the modest housing program, there must be a criteria that is set out so that these people do apply and there must be an evaluation process set in place by the department on how it evaluates those. So, I am wondering if the minister can elaborate on just exactly, just briefly, and I do know that I will be receiving detailed information on how much money is allocated for the modest housing program this year, if there is a ceiling and if it is on a first come, first served basis or if there is an evaluation process that is set out to determine who shall be the recipients of the funding?

MR. MACISAAC: I would be happy to provide the information that I have available with me at the time and we will make available to the honourable member not only a brochure with respect to the family mortgage program, but we will make available to you any brochures that we have with respect to all of our programs so that you could have access to those. We would certainly make them available to other members who are interested as well.

The purpose of the family modest housing program is to provide funds to lower and middle income families for the construction or purchase of modest housing or the renovation of existing owner-occupied units. The total household income to qualify for this cannot exceed $50,000 a year. An applicant cannot own a home at the time of the application - that is for a new home - and an applicant must have established a favourable credit history and the ability to repay the mortgage. That is part of the criteria with respect to qualification. The amount of the mortgage that is available is $70,000. The mortgage interest rate will be determined at the time of the approval.

MR. PYE: Excuse me, I just want clarity here with respect to the total household income. The ceiling is $50,000, that doesn't mean that there is a lower limit as well. Is there a lower limit range on that as well? I probably would assume that it would be between $20,000 and $50,000.

MR. MACISAAC: The lower limit is not set in terms of dollars, but it gets addressed through other criteria that are there and that is that they must be deemed able to afford the investment that they are going to make.

MR. PYE: Excuse me. That again comes back to my earlier statement with respect to 55 per cent of Nova Scotians earning $20,000 a year and less. I guess what we are saying is that when we look at that global picture of Nova Scotians, 55 per cent of them earning $20,000 a year and less, I am just wondering how many of those people could actually take advantage of this program and realize the dream of home ownership?

[Page 454]

MR. MACISAAC: I think that the affordability aspect of the program is one which would require very careful consideration of the needs of individuals in the category to which you referred. I think it points out the need for us perhaps to attempt to provide as much information as we can to members with respect to our programs. I have made the offer with respect to providing details to you, but I think it perhaps points out the need for us to make this available for all members of the House and what we will undertake to do is to provide a detailed presentation with respect to all of our programs and how the calculations are done so that you would have a good working knowledge of what is required. You would be able to, as you listen to your constituents' needs, have a better ability to direct and encourage them to move in various directions.

That is an undertaking that I will make to all members of the House and perhaps we can work it out so that the groups won't be too large. We could do it by caucus groups. It would be a little difficult to do while the House is in session, but we will try to accomplish that within a period of a month following the House rising. Is that a reasonable time-frame for us? Okay.

I understand your desire and should you want further details prior to that then certainly people within the department would be more than happy to sit down with you and go over that. It is a commitment that I will make to all caucuses to provide that information.

MR. PYE: Thank you, Mr. Minister and before I move from Housing and get into your portfolio of Municipal Affairs, I just want to go to the Residential Rehabilitation Assistance Program.

It is a program that is much used as I am sure that your department is very much aware. Your department, I don't think, would ever have enough money to give to the Residential Rehabilitation Assistance Program based on the number of enquiries that come through your department, but there was a striking request that somewhat puzzled me, about one month ago that came through my office. A senior who lives alone had made a request to the RRAP program with respect to having windows and doors replaced in the home. It was my understanding that the Residential Rehabilitation Assistance Program does not cover this kind of home repairs.

If in fact, I am wrong, I would greatly appreciate knowing that and if it does not, that is to me another significant part that should be incorporated within the program to allow seniors not to allow their homes to deteriorate and continue to live there because it is much cheaper. Can you tell me if the information that I have received is correct, that there is no funding through the RRAP program for windows, doors, and/or like structures that may surround it like sills and frames?

[Page 455]

MR. MACISAAC: Mr. Chairman, just by way of general comment, the RRAP program tends to try to deal with issues related to health and safety. If you would provide us - aside from here, not at this forum - with the name, we would be very happy to follow up on the application and provide you with an analysis of what took place with respect to that concern that you have identified.

MR. PYE: Certainly. I also want to make a brief comment as well with respect to the accessibility program where the dollars have come back in. In your initial statement to the estimates, you implied that this will almost double over a four year period of $300,000 in each of those four years and it is more than double the allotment that was in the previous budget and $300,000 is better than no dollars at all for accessibility for physically disabled individuals in the Province of Nova Scotia.

However, that is a small number of dollars when you look at the size of the province, the number of municipalities that are here, the number of requests that will come forward and the need to recognize that we are many years behind some of the major municipalities in this country with respect to providing accessibility for disabled individuals in this province.

I do know that your government has probably had many conversations with the Disabled Persons Commission of Nova Scotia with respect to this program. I don't know if you have, but I would assume that you probably have and I am wondering if the minister can tell me if the Disabled Persons Commission is receptive to this approach and if in fact they have acknowledged that they would like to see more?

MR. MACISAAC: Yes, Mr. Chairman, we did in fact meet and consult with the Disabled Persons Commission, with the LEO group and we sought their reaction to our proposals and we were very pleased with the reaction that we received from them. We received their encouragement to go forward with the program as we had outlined it. Because the consultations occurred prior to the presentation of the budget, we were not able to be totally specific with respect to the details, but they had a very good understanding of the direction which we were taking. We intend to seek their advice with respect to how the program is rolled out and get their reaction to the program.

I can say that the program is currently one which identifies the amount of $300,000 over a period of four years. That will provide us with ample opportunity to assess the need and where we are going. We will be doing that. In an environment of scarce resources, we tend never to have as much as we would like to have with respect to addressing concerns and problems, but we are beginning with this and we will be seeking input from the communities affected and we will certainly be analysing the results of the program as it is being delivered. We are committed to meeting the needs that are there and with that view in mind, we will, as the program rolls out, be doing a continuous assessment of it.

[Page 456]

MR. PYE: I guess, just on a short snapper here. Is there any federal funding that piggybacks this sort of initiative by a provincial government?

MR. MACISAAC: We do not have any federal funds involved in the delivery of this program.

MR. PYE: So, there is none from the federal government?

MR. MACISAAC: No, there isn't, but we will certainly be monitoring the situation. I have just been reminded that, aside from this which deals with community sort of structures, there is federal funding in the RRAP program which is intended to address the adaptations to deal with individual needs with respect to persons with disabilities.

MR. PYE: I did understand that, I was just simply implying accessibility by facilities and structures within the province.

I want to go over to your portfolio of Municipal Affairs. I do know that the Halifax Regional Municipality is undergoing a Halifax Harbour clean-up or sewage treatment process. I do believe that it has changed from the initial onset. This goes back to a previous government, a Tory Government under John Buchanan when in fact there was the intent to build a tertiary treatment plant on MacNab's Island to treat the sewage effluent from Halifax Harbour and transform it into what was then called petropoop and create energy and the whole picture as we all know.

[12:00 p.m.]

However, there have been some significant changes as a result of the federal government and the provincial government not coming onside with respect to funding to give the metropolitan area the opportunity to have a tertiary treatment plant with respect to its treatment of sewage. It is now in the process of creating a secondary treatment plant by the use of three smaller plants located throughout Halifax Harbour. It is my understanding that the original municipality has put a request in, both to the federal Government of Canada and to the Province of Nova Scotia with respect to assisting in the funding of this project. I believe there was a funding formula they had elaborated on that implied that there should be one-third/one-third/one-third cost-sharing formula.

Mr. Minister, I am wondering if your department has received a letter from the Halifax Regional Municipality, and if indeed you are going to be able to provide some funding to the municipality.

[Page 457]

MR. MACISAAC: Mr. Chairman, yes we did receive communication from the Halifax Regional Municipality, and we have that request. It is something we are looking at. It is not something that we have been able to make any determination on at the current time, but it is something we are looking at.

MR. PYE: Can I ask you if the province has been in communication with the federal government re this project as well and how much money the HRM has? What would be the cost if the cost-sharing formula was channelled out? What would be the cost to the province to provide its share of the funding formula to the HRM? Is it in fact in this budget that we are now seeing before us today?

MR. MACISAAC: The amount of the two levels of government that is being sought, I believe if my memory serves me correctly, is somewhere around $102 million. We have had communication with the HRM with respect to this number. We have not been in discussions to this point with respect to the Government of Canada. The other part of your question related to whether any of this is reflected in this current budget, the answer to that question is no, because the assistance, or the proposal I should say, that was brought to us was a proposal that would see the participation of the province in future years, not in the current time-frame.

MR. PYE: I appreciate that, Mr. Minister. I want to go to Assessment Services. I don't want to talk about Bill No. 42. I will have the opportunity to speak about that with respect to the assessors and the exclusion or inclusion when that comes before the House. I have already had my opportunity to make comment with respect to Bill No. 42. What I want to talk about is Assessment Services. I know it is not in this budget year. I do know that you are going to be speaking with the Union of Nova Scotia Municipalities with respect to the costs recoverable of some approximately $12 million from the 55 municipal units across this province. I also want to say that it amazes me, that government, when they see other provinces doing something that is particularly to their advantage, they jump on it, but when it is not to their advantage, they certainly don't jump on it.

You made reference with respect to this not being a downloading onto the municipality. Well, first of all, Mr. Minister, I don't care how you draw the line, and I know you and I will agree to disagree, but in my opinion, it is downloading. You said that it is just a transfer in offsetting costs with respect to the pickup of Community Services. Allow me to tell you that was a commitment by the provincial government for municipal amalgamation. That was a commitment by the provincial government that if in fact they would take over policing and road services and some other services that were normally carried out by the province, that in fact the province would take over the delivery of social services. That, in my opinion, was a good move simply because it made community and social services consistent across the province. So what I am saying to you is that I know there are ongoing consultations but I do know there are municipalities who will not be able to tax for that

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assessment cost recoverable because they will have to place it in a tax formula in order to extract that back.

So, Mr. Minister, I am wondering if in fact you can tell me just briefly, how the ongoing consultations - maybe I should make it much briefer than that because I only have four minutes. Can I say that the ongoing . . .

MR. CHAIRMAN: You had four minutes three and a half minutes ago. You should make your last question quickly please.

MR. PYE: Okay, my last question is, what is the status of those ongoing conversations at the present time with the UNSM?

MR. MACISAAC: The UNSM has indicated that they are prepared to discuss this matter with us. We have not set the date for the first meeting, but it will be coming shortly.

MR. CHAIRMAN: That concludes the questioning for the NDP caucus at this time. I now pass the floor to the honourable member for Cape Breton West.

MR. RUSSELL MACKINNON: I thank my colleague for giving up the extra 10 seconds of his time. It is appreciated. The first thing I want to focus on is the cost of government, in particular, since the provincial body is the overseer of all the municipal units across the province. Would the minister be kind enough to indicate if he and/or someone within his department would have some analysis as to what the cost of administration in each of the municipal units is on a percentage basis? I know the cost of administration for some are a little higher than others and so on, but just to kind of give us an overview.

MR. MACISAAC: I don't have that information with me, but we can certainly provide it to the honourable member.

MR. MACKINNON: That would be great. Respecting the fact that you probably wouldn't have it at your fingertips, do we have a sense of what the cost is on an average across the province? Is it 2 per cent, 4 per cent, 10 per cent?

MR. MACISAAC: In the interests of accuracy, I prefer to get the numbers.

MR. MACKINNON: That is fine. The Cape Breton Regional Municipality obviously would be an issue of concern for me, because of a lot of the machinations that have taken place over the last number of years. Recently obviously with regard to the policing issue and I believe I raised it in the House on a previous date when we were debating last week the NDP Private Member's Bill. I have always been somewhat perplexed as to why - perhaps, it was a for a good reason, I don't know - the Department of Municipal Affairs didn't send a

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facilitator rather than the Department of Justice, since we were dealing with a monetary issue, as much as we were a policing issue.

MR. MACISAAC: It was actually a joint effort, both departments were involved in identifying the facilitator and making the offer to provide the facilitator, and actually giving the go-ahead for the facilitator to go forward. It was an effort by both departments, not just the Department of Justice or the Attorney General.

MR. MACKINNON: Could the minister apprise the members of the committee what the terms of reference were for the facilitator; what was his mandate; what was he to do; what was his objective?

MR. MACISAAC: At the time that the offer of the facilitator was made, it was made in the context of the municipal unit having made a determination that they were going to revisit the issue at a meeting. The terms of reference were to provide assistance to the municipal unit in their deliberations with respect to the revisiting of that issue, and to be available to the municipal unit with respect to any initiatives that they would take beyond that meeting.

MR. MACKINNON: What sort of issues did they look at? Did the facilitator prepare a report when he came back to the minister's office, for either the Department of Justice or Municipal Affairs; did he prepare any type of a written report?

MR. MACISAAC: Yes, he did.

MR. MACKINNON: Would the minister be kind enough to table that?


MR. MACKINNON: My concern, and maybe I have . . .

MR. MACISAAC: I would be quite happy to share the essence of the report with the member, if he wanted.


MR. MACISAAC: He attended the meeting, and the meeting was a day-long affair. They did revisit the issue, and there was a considerable degree of very frank discussion, with respect to the issue that they were revisiting, and the facilitator played a role in terms of enabling those discussions to occur. It was concluded by that meeting that it was their desire to confirm the decision that they had previously taken. Once the decision to confirm had occurred, then it was a unanimous resolution of the council that they move forward from there. I think I am correct in saying that the decision was reconfirmed, then it was the

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unanimous decision to move forward from there. If my memory serves me correctly, it was not necessarily a unanimous decision with respect to reconfirming, but it was - I am trusting my memory here now - a unanimous decision to move forward from there, once that decision had been taken.

MR. MACKINNON: It is okay to maintain this free-flow conversation, and that is okay with the minister. If he sees where I am getting off the rails, asking something that is not generic to the matter, he can just bring it to my attention. I really want to get to the nuts and bolts of this decision-making process, because I think there are two schools of thought in this regional municipality. One is from the administration's point of view and not entirely unanimous within the council, you expect that and you respect that, that is part of the political process. There seems to be two schools of thought that exist, one is that we are the administration, we are the policy advisors, but in fact the way we devise our policy initiatives and attach it to certain budgetary configurations, council is put in a position where it is a yes or no, take it or leave it type of scenario, whereas I have always been of the adage that policy advisors, senior administration should lay out options a, b, c and hear the pluses and minuses to each, the cost benefits and negatives to it.

I think the initial terms of reference that were drawn up for that policing proposal was one or the other, but the initial terms of reference never provided for a joint police force, just focusing on this particular one. It was either you take one or the other but not both. To me that was a fundamental flaw in the decision-making process. I don't necessarily lay that on the shoulders of the political body within the regional municipality, in all fairness, whether I agree or disagree with them on other issues, I believe that the advice that they are receiving, there are considerable questions that have to be drawn, and that is why I asked what the considerations were, the mandate and the terms of reference for the facilitator going into that particular municipality. I see a broad range of other issues that will evolve even after this one.

I will give you an example, and I raise the cost of administration. Some of the chief CEOs, the chief senior policy advisors within that municipality are paid higher than some of our deputy ministers, even for the Department of Housing and Municipal Affairs. I think for a cash-strapped municipality, that is not good.

MR. MACISAAC: I don't want to lose any of my employees here.

MR. MACKINNON: I guess it could be a little like the Titanic, it is going along just fine now, but sooner or later they are going to hit an iceberg. These are the types of things. The terms of reference were not, I don't think, the appropriate terms of reference. I think this had led to a major frustration within the community, and although there are a lot of positive arguments that could be made on either side, hearing the voice of the people. I was really perplexed early this week or late last week, where one of the members of this particular council indicated that they should have public hearings on the garbage issue, whether a landfill should continue to be maintained in the community where it is located, Grand Lake Road. I

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was kind of saying to myself, why would you want public participation on the garbage issue and not public participation on what I perceive to be a more major issue.

These are the types of structural things that although we probably can't speak to one particular issue at this point that has already been dealt with, I see there are things that, perhaps, could be done, maybe they can't be done. I know the Municipal Government Act was designed to give more independence and self-development and structure to the local governments, but there are some flaws that appear to be surfacing as a result of this. I really think what has happened on this one particular issue, the police issue - I have never made any secret of it, so I might as well say it - I have always been of the adage that we should have both forces. It is good checks and balances, they both have pluses and they both have negatives.

Knowing the history of the eight municipalities as best I do, I think this decision will prove to be a major mistake in years to come. It is going to be a major mistake, and it has literally torn the community in half. It is a sad commentary on the Public Service, whether it be myself or municipal or whoever. It is going to take years. There are family members who don't speak to each other, we have neighbours living next to each other who are literally at each other's throat. I recall receiving a call from a regional police officer advising me, essentially, to put a muzzle on it. I have a tape of that phone call. I was very disturbed, and I spoke to the police chief on it. I am saying to myself, these guys are losing it.

For what? All because at the advisory level within the structure, this power structure, building these little power structures within government is very counter-productive. I don't know if there is anything that the minister and/or his department can do about it, but that was the type of thing I am looking at more so than the actual individual issue. There are problems there, because - I will go back a little more just so you will have a better understanding of my history of it. When we brought regional government into Cape Breton County, I was in full support of it, I think anyone who was with the department at that time would certainly understand how strong I was on it.

The year before or only months before, the municipal government for the Municipality of the County of Cape Breton tried to bring in what I thought was nothing more than a political bill that would have cost the taxpayers money. We fast-forwarded. (Interruption) No, we didn't even get to service exchange at this point. This was what they called the Cape Breton County Charter. That died, we ended up killing it at Private and Local Bills because there were enough people who understood the damage it would cause in the big picture, in terms of regional government in years to come, and trying to incorporate all eight partners into the process.

We did that with the understanding that we would allow at least one full term for all eight of these municipal governments to come together and have the various personalities work in unison. Before the year was out, we ended up bringing in the exchange of services,

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which essentially, because of the original charters of some of these municipal units and the funding arrangements between the units in the province, what happened is it automatically pitted one group against the other, urban versus the rural, which was totally unnecessary, had we taken a moderate approach.

That is a mistake, I believe, that the Savage Administration made. It was a major mistake and it took three years for me to be proven right on that, but now we have it. That is reality, and I accept that. This is a consequence of that, and if we don't learn something from this police issue or do something to change that methodology, we are going to see more of it. Reducing the size of the council will help to correct some of it, but I am not sure if it is going to be enough because the scars are so deep in the community right now. It is scary when people are made to believe that if you don't support the regional police, you are an enemy of the state, or if you don't support the RCMP, then you are not thinking straight. That sort of thing. I can only give some of my personal experiences.

It is not a healthy situation, Mr. Minister. I am sure you have had lots of good political advice and probably some greater wisdom from down there than I have been able to provide, but that is my experience. I stand to be corrected, and I would bet a dime to a doughnut that if things aren't changed on the process or at least what is happening in terms of the advice, I am not sure that the political body is strong enough to deal with it. I raised it with my colleague, the Minister of Finance, yesterday. When you are in Cabinet and all these OICs are coming in and you are dealing with anywhere from let's say $1 million to $8 million a Cabinet meeting, from different departments, sometimes you really question yourself, do you have enough information. We have a two or three hour Cabinet meeting, and you either approve these things or you don't. You have to, sometimes, depend on considerable expertise. That is a judgement call. Other times, you will sit down and perhaps, and I have seen it happen at councils like this, they will argue for four days over $150.

These are the types of things, I am not sure exactly what the right way is to deal with it. I was quite concerned with the CEO last week, for the municipality, indicated he would be just as happy to go take his severance package because he would get upwards of $300,000-plus and a very generous retirement package, which he himself was one of the architects of. These are the types of things that go on that frustrate people and isolate people from the very process that was designed to bring them closer. If I could leave that with the minister, it may be a perspective you have heard before, but there are problems there that go beyond this one particular issue, although this issue will have scars for years and years to come. I am on public record, and I will stand by that.

It is very distressing, particularly with the economic situation the way it is. We are at a very fragile point because of the downturn in the coal industry, the downturn in the steel industry, and a lot of other things. That is a culmination of a lot of things that took place long before your administration came along, it is 30 years in the making, maybe longer, but it was

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too much too quick. That is the problem. Maybe downsizing council will help, maybe it will, but at this point, I don't see it. If I could just leave that with the minister.

MR. MACISAAC: Mr. Chairman, I noted with interest the honourable member's comments, and I appreciate that he brings considerable experience to the table with respect to the situation in the CBRM. I have noted what he had to say.

MR. MACKINNON: Mr. Chairman, it is hard to respond because a lot of things were meshed in, and I respect the minister's being cautious on this one. Switching the focus just slightly, a number of local issues that I addressed with the minister at the last budgetary deliberations, there were two. One was the Birch Grove sewer that the department had participated in last year or the year before, a joint venture, a cooperative effort between municipal, provincial and federal. The feds were slow coming in, but they did chuck in their one-third for that first phase. The main trunk line is in, all the heavy duty stuff is pretty well done. But it is not complete. I realize money is tight. Has there been any discussion or deliberation or consideration whatsoever in terms of finishing this particular project, because of the seriousness of the community, the health of the community?

MR. MACISAAC: Mr. Chairman, we are currently involved with the federal government. We have had initial meetings, as I indicated in my opening remarks, with respect to the infrastructure program that is coming. Certainly one of the criteria that would be brought to the table with respect to projects that would be considered would be anything relative to health concerns. It would be looked at in that context. (Interruption) Yes, obviously, we look very closely at what the municipal unit wants in respect to these matters.

[12:30 p.m.]

MR. MACKINNON: Yes, and I understand that, I respect that, but this would be a classic example of political bias in the first degree at the municipal level. This project should have been number one for a number of years and it went from, I think, number one to number three, to 21, to 23, up to number 18, until finally I was very fortunate to have my colleague, the Honourable Wayne Gaudet, when he was minister, come to the site and actually see how desperate the situation was and then from there we involved Dr. Patricia Ripley, who was deputy minister at the time. It took her less than one-half hour to come to the conclusion that this was a major problem and I don't want to get into the details of it because I don't think it is very pleasant.

You can imagine if you have lots 60 by 100 with onsite sewage disposal and you have a cluster of 135 or 140 of those in a small concentrated area and, you know, for 30-some years, you did not even have to turn the sod to find what the reality was. It was not healthy and, again, I don't want to go beyond that, but if I were a betting person, which I am not allowed to be because we are politicians in public life, we take a chance as it is running, but

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I would be willing to bet that the municipality will not make this a priority because of some of the structural problems that I have identified.

In fact, the record will show one-half hour before we were about to sign the agreement with the municipality, the chief engineer tried to kill it, Mr. Kevin MacDonald from the Cape Breton Regional Municipality. That is back when my colleague was the minister and, again, I have to thank Dr. Ripley who faced the reality of it, but the chief engineer for the province who was in charge of these types of projects, was advised by the municipal engineer that they did not want to proceed with it. That is the type of problem that goes on in situations like this so, you know, in fairness to the minister, you may not always get the right information and this may not be isolated. I am sure it happens in a lot of areas, but I draw that to your attention because it goes beyond politics.

MR. MACISAAC: Mr. Chairman, I have certainly noted the comments of the honourable member and we will have to see how things progress.

MR. MACKINNON: Of course, if we are looking at one of those infrastructure programs again, obviously, it is another issue I raised last year, the Floral Height Subdivision with some 450, close to 500 homes, and there is not one sidewalk through the entire subdivision despite the fact that we have the community fire hall there. We have a large elementary school with over 400 students and it is dangerous. We are not looking for everything because we know government does not have it, but at least enough to deal with the critical areas. There have been some very serious incidents in previous times, so, again, I raise that, if you just make note of it and if I am lucky enough to fall within the scope of having that approved.

MR. MACISAAC: Your use of the word fall brings to mind certain opportunities. I am not going to say any more than that.

MR. MACKINNON: Okay, we will leave it at that. I knew I should have put my blue tie on in here today. With regard to user fees within the department, either Housing or Municipal Affairs, could the minister identify what new user fees are being implemented this year, if any?


MR. MACKINNON: None. Is there any increase in user fees?


MR. MACKINNON: None, okay. In Cape Breton, the Nova Scotia Housing Department, the RRAP Program, there never seems to be enough money. There always seems to be about 3,000 or 4,000 names on the backlog because, you know, I guess you would

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almost have to use your entire department's budget just to meet some of the backlogs and we understand that, but has there been any increase in dollars for that or is it the same, or less?

MR. MACISAAC: The RRAP money contribution of the federal government has doubled for the next year and we have increased our input to that program as well.

MR. MACKINNON: Is that for the Cape Breton region?

MR. MACISAAC: It will be spread throughout on an equitable basis.

MR. MACKINNON: I trust the minister's judgement on that. On Page 88 of the Public Accounts Supplement there was an expenditure to the Cape Breton Regional Municipality for $220,319.95. It is in the right column about one-third of the way down, Page 88.

MR. MACISAAC: Here it is, yes. There is a $175,000 cost-share on design of SAP, the HR module to be used as a template for municipalities and the remainder towards a SAP business case study, that is the feasibility of other municipal units to connect to SAP.

MR. MACKINNON: What is SAP? I know it is not in a tree.

MR. CHAIRMAN: I think that would be an accounting package.

MR. MACISAAC: I think the Chairman has the correct answer, it is a software package that has accounting capability, yes. If it helps the honourable member, I asked what SAP meant too because I knew it was not what we do with the maple trees.

MR. CHAIRMAN: Systems accounting program.

MR. MACISAAC: Systems accounting program.

MR. MACKINNON: On the next page there, on Page 89 in the left-hand column, there is an expenditure there for McKenna Surveys, $49,304.10. It seems like a rather expensive survey, I was just curious.

AN HON. MEMBER: It was not your company, was it?

MR. MACKINNON: No, my survey firm would be much cheaper.

MR. MACISAAC: That is a mapping project in the Land Information Systems department. I think you have to take the context of . . .

[Page 466]

MR. MACKINNON: Yes, I can appreciate that. I know exactly how they work. I must say on the mapping stuff, some of my bills were higher, so I have to be careful here, but this is going back when we were doing the base work, the base mapping for the province, so as to set the first step for the new land titles system.

MR. MACISAAC: I am sure the province got good value for its money.

MR. MACKINNON: Yes, I have no doubt about that. (Interruption)

MR. MACISAAC: I was referring to the work you did. (Laughter)

MR. MACKINNON: They kept sending me notices for more tenders so they must have been good and our prices were the lowest. That is why we got them, but on that, with regard to this new land titles system, or Registry 2000, as it has been named, what is the time-frame that we are looking at in terms of the implementation?

MR. MACISAAC: Full implementation, complete, everything, would not occur before 10 years because I think you can appreciate that while we would implement the electronic capability of dealing with this, we also must maintain the written record that is there and we also need to develop the capacity to preserve that written record into the future so we are going to be dealing with a parallel system. As we move into the electronic system, we will still have to maintain a parallel written system and we will move forward with that.

As the system is implemented and developed, then we may find that we can move quicker in terms of implementation than we currently feel we can, but we think we are looking at least a 10 year time-frame. (Interruption) Yes, I am reminded that we are dealing with 9.5 million documents.

MR. MACKINNON: Yes, I can appreciate that, particularly when we are dealing with some of the complexities from our present registry system and given the fact that a lot of these documents, a lot of land documents are still not recorded, a lot of old wills and so on, but I was a bit concerned about, and I have to confess to being a little weak in my memory on this one, but I think there may have been an amendment to the subdivision regulations that would require any pieces of real estate that are divided through a will now will have to go through the full subdivision process whereas under the old Act they did not?

MR. MACISAAC: My memory is like yours on this one. I recall something about it, but I will take note of it.

MR. MACKINNON: That would be fine, if you could, because it is a very important issue for a lot of seniors across the province, particularly in rural Nova Scotia where a lot of their estates, their wills have been written and they just put it away and so on and then to have these changes imposed on them and in some cases where the individuals may have passed on,

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then what happens? How do you reconfigure that without taking issue, without being forced to go before the courts, particularly if you have one or more siblings who don't agree with the way the property has been divided because once they start tampering with that original configuration or division, then all of a sudden that is when people start to disagree. So there are tens of thousands like that to the best of our estimate that could very well be affected.

It was a way to allow for that transition. As the minister has indicated, we have a 10 year period to move from this system into the next one although I must say part of the problem that I believe we do have is because at one time, in our general area at least, in the registry system in Cape Breton, the members of the legal community always recorded their abstracts of title, their certificates of title. That made it very easy for the next person coming in on the next series of transactions to be able to use that as a benchmark to move forward.

Now, and I am speaking from experience on behalf of a lot of clients in my other life, 9 times out of 10, you will never see a complete abstract of title prepared by anyone who is certifying title. You do not see it. You just get their working notes and I know there are certain legal elements that were injected into the process that would not require somebody to go back to the original Crown grant going back to a 20 year period or the 40 year, or whatever the case may be, depending upon the circumstance, but that I believe has been part of the problem in assisting the Department of Municipal Affairs to move forward on this system. Those who are now advocating and helping to coordinate to move forward in many cases have been actually the source of the problem.

So I would just leave that with the minister as just an observation from a private sector point of view, but I also notice that the government, the department commissioned a firm from the Valley to do an analysis, a study, on this Registry 2000. Am I correct on that? Has that study been completed?

MR. MACISAAC: No, it is not completed. I don't have the name with me, but I believe it is somebody from Kentville doing it.

MR. MACKINNON: Yes. A legal firm?

MR. MACISAAC: Yes. I think an individual.

MR. MACKINNON: Yes. I just raised that because there is, and it is just not myself, there is quantifiable evidence that will demonstrate the basis for my concern. You have to sometimes consider the source and I don't mean that in a negative sense of what this study might be or anything else. I am just speaking from 22 years of doing service in and out of the registry system and even when I worked with the Department of Natural Resources under its old title, we were with a special division, special projects division, where we could travel anywhere in the province doing work for different government departments and we found this was a regular problem.

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So I would leave that with the minister because what it means in layman's terms is the difference between either saving or spending upwards of $10 million a year from a consumer's point of view. That is my estimate based on a number of transactions and title searches. So the consumers of Nova Scotia could be either expending upwards of $10 million, it could be even more, it might be a little less the way things are going, but that was a figure that I had just generally extrapolated from different experiences across the province and did an estimate based on a number of systems and a number of normal transactions that would take place.

I believe that the consumers under your new system should be able to save upwards of about $10 million a year, but depending upon how it is played out, it could cost them even more. So I leave that as a genuine concern.

MR. MACISAAC: Mr. Chairman, I can say to the honourable member that we have taken notes of his comments and we will certainly pass those comments along. I can say that we certainly value the input of the experiences that people have and we are certainly open to receiving suggestions. We have made a note of your comments and we will certainly pass them along.

MR. MACKINNON: Other than that I don't have any more questions, Mr. Chairman. I thank the minister for his attention.

MR. CHAIRMAN: If there is no one from the Liberal caucus, we will turn it over to the NDP caucus.

The honourable member for Dartmouth North.

MR. JERRY PYE: Mr. Chairman, I will not take that much more time, I only have a few questions.

MR. MACISAAC: Just for purposes of planning, Mr. Chairman, God forbid that I should be presumptuous and I am not, but when you say you are not going to take up too much more time, I am raising this because the Labour estimates, I believe, are coming next and . . .

MR. PYE: Human Resources are coming next.

MR. MACISAAC: Okay, well, I am confused. All right, Human Resources are coming up, fine.

MR. PYE: Your House Leader was just in and talking to me.

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MR. MACISAAC: Good, all right. The Chairman earlier said that he was going to call this resolution and then was going to call the Labour resolution and if we were coming close to the end of this, I was going to have to get the Labour people prepared, but if that is not the case, then that is fine.

MR. PYE: Mr. Minister, I do appreciate that but as I said earlier, it is from your House and these are the comments. I want to go back to the machinery and equipment tax. I do know, as a former municipal official, that the municipalities used to place a levy on machinery and equipment as well. As a result of that, the municipalities did what was then a five-year phasing out. I don't know if all municipalities have, but I do know that the former City of Dartmouth did a phasing out of the machinery and equipment tax. Give me some clarity if I am wrong, but what I understand is that the provincial government taxes business on the basis of the machinery and equipment that they have. It is a percentage tax ratio. I don't know what the percent is by the provincial government, but I guess there is a concern with respect to this government finding itself in a position of scarce revenue resources, and that it is in need of every dollar. Why would your government decide now to go through - and I believe it is starting in this fiscal year - the elimination of the machinery and equipment tax?

MR. MACISAAC: What we have been doing is phasing - that tax has been phased out - and it was due to be concluded in four years. We have, in fact, been paying that tax on behalf of the businesses that were assessed that amount of money. The decision we have taken is to discontinue the payment on behalf of those businesses. The phasing will still carry forward in the sense that the tax will eventually be phased out. We felt it was appropriate. All Nova Scotians are being required to pay the price in terms of bringing our expenditures in line, and this was an opportunity for the business community to make a contribution to that.

MR. PYE: Thank you for the clarity, and I guess, Mr. Minister, business will argue that it already pays a real property tax and a business occupancy tax and is paying sufficient tax and appreciates that small subsidy whatever the amount may be. Now I understand that the member for Guysborough has a new business there. I believe it is a gas fractionation plant, that is the term that was used. I understand there is some concern with respect to whether that is considered to be machinery and equipment. I am wondering if you can tell me without going into a great deal of detail is there any validity to the comments of the corporate entities that are acting on behalf of the gas fractionation plant in Guysborough, if there is any validity to their statement?

MR. MACISAAC: Well, they have made the decision to appeal the assessment, so that process will in fact take place. They obviously have a view that is different than that of the department. The appeal process will have to provide the answer to that question.

MR. PYE: When I earlier had my hour of budget estimates, my time had run out. I was talking about assessments and downloading onto municipalities. I just want to come back to that for a minute in reference to the 55 municipalities. Can you tell me if there are

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municipalities now that are in a deep debt position? Can you tell me if there are municipalities - I guess there is a ceiling of debt ratio of what is considered the norm of 15 per cent of the revenue coming through the municipality, that 15 per cent is paid towards the ongoing debt - that have a higher debt ratio per revenue?

MR. MACISAAC: Mr. Chairman, we have one municipal unit that we would categorize as being in a difficult situation. All of the others appear to be living well within their means.

MR. PYE: That is very fortunate, Mr. Minister, if there is only one. Okay. I guess, Mr. Chairman, I will wrap up with my final question today which is with respect to policing services and the rights of municipalities. As you know, there is a problem with the delivery of policing services in the Cape Breton Regional Municipality. I know that there was a debate, a resolution debate, a bill debate on this within the Legislature. The minister made some comments that it was within the jurisdiction and the domain of municipalities. What do we say to residents who in fact are unable to get the ear of their local municipal council when we have up to approximately 4,000 residents who have been accustomed historically to a delivery of policing services within their communities?

We recognize that municipalities are made up of different communities, are communities within communities. Each community has become accustomed to a delivery of service. When there is some opposition and concern, and they go by way of the right route of taking it before municipal council, having public meetings, requesting the municipal council address their issues, and when I look at the new Municipal Government Act which says that the municipal government shall be a form - and in fact the former government who introduced the new Municipal Act recognized that municipal government was a form of government onto itself, and it was an order of good government - what do I as a member of this Legislative Assembly say to people who believe that they can't have their concerns addressed by a municipality? In this particular case, both you and I know that we are talking about the Cape Breton Regional Municipality. To me, it seems most unfortunate, Mr. Minister, that 4,000 people see that their voice is lost in the wilderness.

MR. MACISAAC: I certainly can relate to the fact that the issue to which the honourable member refers is one which has generated considerable divisiveness within that community. However, the Cape Breton Regional Municipality is a sovereign government responsible for carrying out their responsibilities as spelled out under the terms of the Municipal Government Act. I guess in their case it is the Cape Breton Regional Municipal Government Act that is referred to. The Legislature, in its wisdom, saw fit to grant to them certain responsibilities. In doing so, they have indicated to that government that you have jurisdiction over these concerns.

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In this particular instance we are dealing with police, and they have a responsibility to provide that service. They also have a responsibility to bring forward the budget, to levy a tax in order to meet the demands of that budget in conjunction with other sources of income that they have. The Legislature has said to the Cape Breton Regional Municipality that you have responsibility for making decisions in these areas. We, I believe, need to respect that they have been given this authority. We can observe what is taking place. We can certainly have tremendous sympathy with people who feel that their interests have not been adequately addressed.

On the other hand, there are many people who would feel that their interests have been addressed. But it is their decision to make, and it is their decision to implement. I believe we need to be able to exercise the discipline to enable them to carry out their decisions regardless of what our personal views might be with respect to those decisions. The Legislature has given them that authority, and we need to respect that authority, and we need to respect their abilities to carry that out.

[1:00 p.m.]

The Legislature, in its wisdom, to be quite frank, Mr. Chairman, has also provided for citizens to pass judgement on how those decisions are carried out because the Legislature has said that every four years there shall be an election. At election time, all of us sitting around this table certainly understand that is accountability time. This fall there will be a municipal election and that will be an opportunity for citizens to pass judgement on the activities of the council as well as evaluate future issues and issues that will come to the fore at that particular time.

So, yes, I acknowledge there are a large number of citizens who are frustrated, and there are a large number of citizens who are frustrated at any given time with respect to decisions that governments make. I don't have to remind anybody around this table of that. But the rule of law applies, and when you put the law in place, that establishes the rules of the game. Those rules need to be respected.

MR. PYE: Mr. Minister, I would say to you that when a decision of government appears to so adversely affect the delivery of services that citizens have become accustomed to, then I think the citizens should have the right to at least be heard. I believe the Cape Breton Regional Municipality is one of the few municipalities without the right to have a plebescite, and I think there might be a need for an amendment to the Municipal Government Act to allow municipalities to have the right to have a plebescite. I want you to know that I have been fortunate enough to live in communities where in fact the RCMP have delivered the policing services to the rural community, and I have lived in the city where regional police or city police delivered the services, and both were excellent services. I want you to know that quite clearly. I am not here stressing the delivery of a service with respect to competency

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to the citizens of a municipality. I am here trying to loosen up democracy in a way that citizens feel that they have a right and a way of input.

Remember elected municipal officials used to serve for a three-year term in this municipality. It was under the Municipal Government Act that they now have a four-year term in office. Sometimes that period of time may be too long, much the same as it is for us, it may be too long, and people may want to call us back and say, look, you have not delivered on what you said you were going to deliver during your campaign process. That in itself, you know, people have to live out the four years. I don't want to go the United States where there is a plebiscite on every single issue possible, because they can become ineffective and very damning to particular issues in a community. But I do want to say that I have grave concern with respect to the ability of citizens to be heard on a particular issue. I expressed this during the municipal amalgamation period while I served on the former Dartmouth City Council at that time.

Mr. Minister, I want you to know, and you don't have to respond to this particular comment, that I think there ought to be provisions within the Municipal Government Act that allows municipalities to have the right to participate in a plebiscite on issues that are important to them.

The final question I have is one my colleague asked me to bring up, and I do apologize. I said that was my last question, but this certainly will be my last question. I know that my colleague, the member for Dartmouth-Cole Harbour, in October, during your estimates, had an issue with respect to 20 Circassian Drive. I do know that you have met with my colleague, the member for Dartmouth-Cole Harbour, Darrell Dexter. In fact, you actually visited 20 Circassian Drive in that area. There were commitments made by you at that particular time, I do believe, that you and the department would do a follow-up on some items, washroom facilities, and there might have been some other areas. I am just wondering on behalf of my colleague if you have prepared a follow-up and if you have looked at addressing the issues and concerns that my colleague for Dartmouth-Cole Harbour has expressed to you as well as the residents of 20 Circassian Drive?

MR. MACISAAC: Mr. Chairman, the follow-up is ongoing. It was barely a month ago since we visited there, a very pleasant visit. I can say that the follow-up exercise is under way.

MR. PYE: Thank you. That concludes my time.

MR. CHAIRMAN: Thank you. I understand the Liberal caucus has one more question.

The honourable member for Cape Breton East.

[Page 473]

MR. DAVID WILSON: Just on a point of clarification. The Cape Breton Regional Municipality does have the power to hold plebiscites. Is that correct?

MR. MACISAAC: Yes. The honourable member gave me the option of not responding, and I didn't because I thought he was just wanting to put his comments on the record. It is possible and this is part of the reason I chose not to respond because as I understand it, the plebiscite the honourable member has in mind is one which could be initiated by citizens, whereas the plebiscite through which the honourable member for Cape Breton East is referring is one where the municipal unit could in fact initiate the plebiscite. That type of plebiscite is within the terms of the Cape Breton Regional Municipal Government Act. Am I calling that by the correct name? (Interruption) Okay, that is referred to in the Municipal Government Act.

The only other comment I would make with respect to plebiscites, my view of a plebiscite might be different if we were debating the principle of plebiscites for municipal units not tied to an instance that occurred in the past. We are not going to come forward and say we want to implement a plebiscite in order to correct something that has occurred previously. I might sit and listen to the discussion if we were talking about the principle of plebiscites in general. But my inclination is that it is better to elect people to make decisions and allow them to make decisions. I think the provision for a plebiscite within the MGA is one which allows a municipal government that is attempting to make a decision to go ahead and consult with its citizens. However, you are quite correct.

MR. WILSON: Thank you.

MR. CHAIRMAN: Are there any further questions from any of the Opposition caucuses for this minister? Hearing none, I now give the opportunity to the minister for some closing remarks in regard to the estimates for the Department of Housing and Municipal Affairs.

MR. MACISAAC: Mr. Chairman, first of all I want to thank the committee for their attention. I certainly want to thank the honourable members for their questions and the comments which they passed along. As I indicated at the outset, this I find to be an extremely useful exercise, and certainly the participation by members is one which allows us to expand our appreciation of concerns that are out there and provides us with an opportunity to consider how we should be responding to those concerns in the future. I can indicate that we have taken note of all of the requests that were made for additional information. We will forward that information in accordance with the wishes of the Chairman which will be through the Speaker's office to each of the caucuses, and it will be forthcoming. I want to again thank the staff who have joined us here today, for their assistance. I can say to all honourable members, thank you very much and I look forward to seeing you during the Labour estimates.

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MR. CHAIRMAN: Now I shall call the resolution that is before the subcommittee.

Resolution E13 - Resolved, that a sum not exceeding $88,663,000 be granted to the Lieutenant Governor to defray expenses in respect of the Department of Housing and Municipal Affairs, pursuant to the Estimate and the business plans of the Nova Scotia Housing Development Corporation and the Nova Scotia Municipal Finance Corporation be approved.

Shall Resolution E13 stand?

Resolution E13 stands.

On behalf of the committee, I would like to thank the minister for your time, and the patience of your staff in doing your presentations. This concludes the debate on estimates for Resolution E13. I understand that the Opposition wish to go to Human Resources.

The honourable Minister of Human Resources.

Resolution E14 - Resolved, that a sum not exceeding $3,986,000 be granted to the Lieutenant Governor to defray expenses in respect of the Department of Human Resources, pursuant to the Estimate.

HON. RONALD RUSSELL: Mr. Chairman, on my right is the Deputy Minister of the Department of Human Resources, Judith Sullivan-Corney, and on my left is the Director of Policy, Heather deBerdt Romilly, and on my far right, the Director of Finance, Joyce McDonald.

Mr. Chairman, I have a few opening remarks I would like to make before I get into the questioning portion of the examination of the estimates, if I may. It is a pleasure to be here, as always, to take part in the estimates debate, and I am very, very pleased to be here representing the Department of Human Resources. As you know, I am the minister replacing John Chataway, who unfortunately has been ill and will not be with us during the estimates.

I would like to begin by talking about the department's priorities for this fiscal year. A top priority, Mr. Chairman, is to provide human resources support to the restructuring in government and the changes in the department that will take place as a result of the budget that we presently have before us. This will be a year of change within the government as we focus our efforts on reducing our operating deficit, and restructuring to better serve the public. The Department of Human Resources is taking the lead in coordinating the human resources response across government, so departments will be responding in a consistent manner, and the treatment of employees will be fair.

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This will be a busy year for labour relations and collective bargaining. The Civil Service master agreement expired at the end of March, and we will be heading into negotiations with the NSGEU probably later this spring. This will be a challenging round of negotiations, but as government, we are committed to treating employees fairly and to reach agreements which are affordable to the taxpayers of Nova Scotia. We are ready and willing, as a department, to work with the NSGEU to develop options to lessen the impact of reductions on employees. I, myself, have met many times with the President of the NSGEU, as have staff of the Department of Human Resources, and we are willing to continue those discussions.

Accountability is a cornerstone of government. We will be developing human resources policy frameworks to strengthen accountability in government. It is important in such a period of change that we have human resources policies and practices that meet the government's current and future human resource requirements. Although our immediate human resource requirements are small, we know at some point when the budget is under control then young people can look for careers in the public sector. That is why we are continuing to fund, through Economic Development's Provincial Employment Program, popularly known as PEP cooperative education programs in government departments. PEP funding also supports our summer diversity and mentorship programs for students from the designated groups, as well as young women preparing for non-traditional careers or careers in management.

I am pleased to tell the committee that this funding will also allow us to double the number of internships available under the Career Starts internship program this year. We know, and I am sure every member knows, how important it is for young people to get that first job experience as they start their career. Through Career Starts, they are able to gain almost one year's experience in the job market in their field of study within a year or two of completing their studies.

Mr. Chairman, like any employer, government needs to update its thinking and change its practices to meet the changing nature of work. One such area is our job classification system. Over the last year, the department has been working with the NSGEU to develop a new job classification system for bargaining unit positions in the Civil Service. Together, the joint union-management committee determined the criteria for a job evaluation system and worked with an outside consultant to develop the tools to successfully review all bargaining unit positions. Earlier this year, it was agreed the system will be piloted in the Department of Finance. Later this spring, the joint committee will begin the job information collection process. Mr. Chairman, I would advise the committee that this is a very, very important project for the department.

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Another area where the workplace is changing is the actual location of the workplace. Technology allows employees to be connected to their office via computer and cell phone from home or remote locations. More and more, you see companies and organizations allow their employees do this type of telework.

In December 1999, we completed a six-month pilot project on telework among a small group of government managers. The department is currently reviewing the results of the pilot and will use the findings to help us find medium and long-term flexible work options, such as telework, which will help governments reduce costs and recognize the changing needs of our workforce.

Like all government departments, Human Resources has had to cut its operating budget for the coming year. I know committee members have copies of the Estimates Book where the information is detailed. The budget calls for a reduction of eight full-time equivalents. The plan is to absorb those cuts through not filling vacancies, reducing casual positions and consolidating services where possible. With a tight handle on operating expenses, Human Resources will be able to operate under the new budget this fiscal year. During that time government will also be moving to a new structure for the HR function in government, which will eventually replace the Department of Human Resources in its present format. As a government, we have identified the importance of controlling costs or managing government spending centrally, of planning centrally, which is why we will be moving to a Policy and Treasury Board model over the next 12 to 18 months. I will be speaking about that at some later time.

At the same time, we recognize we need to do a better job of managing the human resources costs across government and across the public sector. To do that, we will be working to develop a public sector commission which will focus on labour relations and HR management of not just government, but the provincial public sector. With more public services being delivered by boards, authorities, agencies, and not directly by government departments, we need to be able to influence the human resource cost of the public sector more directly than we can do today.

As a service industry, government's major costs are the salary and benefits of employees; 70 per cent of government's expenditures, according to the Minister of Finance, are taken up with those costs of salaries and benefits. It is clear that the way government has managed those expenditures in the past has not been successful. It has contributed to the spiralling operating deficits and growing debt. We recognize the problem, and we have the will to take measures to correct it. The public sector commission will evolve over the next year, a busy year to be sure, a year with tremendous change, a year that will see government take the necessary steps to get Nova Scotia back on its feet, and government once again in control of its fiscal future.

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Thank you, Mr. Chairman, and at this time, I would be pleased to answer any questions or observations that members of your committee may have.

MR. CHAIRMAN: Questions now will be asked from the Liberal caucus.

The honourable member for Cape Breton East.

MR. DAVID WILSON: Thank you, Mr. Chairman. Thank you, Mr. Minister, and to your department officials, it is a pleasure to be able to ask you some questions here today during the estimate debate. I understand by your opening comments, that indeed it will be a difficult year for your department, starting off with the fact that your budget, as I read here, was approximately cut by 3.7 per cent. Is that correct?

MR. RUSSELL: I believe it is a little larger than that.

MR. WILSON: I believe you are looking at Page 15.7 of the Estimates Book.

MR. RUSSELL: Just one moment, and we will give you an exact number on that. While we are getting that number for the member for Cape Breton East, Mr. Chairman, perhaps I can just advise the member, in essence, every department of government was asked initially to find an approximate 15 per cent reduction in this coming fiscal year. Now that was a target. However, in some instances it perhaps came out above that figure and in some instances below. In the case of the Department of Human Resources, the actual figure is 8 per cent.

MR. WILSON: The budget says that 600 civil servant jobs will be lost. Is that correct?

MR. RUSSELL: That is approximately correct.

MR. WILSON: How will your department be dealing with that loss?

MR. RUSSELL: Mr. Chairman, I would advise the member for Cape Breton East that that is a difficult task at any time, to issue pink slips to people. The majority of our staff, as the honourable member and all members I am sure are aware are unionized personnel. There are, contained within the agreements we have with our personnel, some restrictions on the way we can lay people off. It is going to vary according to the classification of the person. However, the staff of Human Resources are working very, very closely with the departments and with the union to achieve fair settlements with those who are going to unfortunately lose their positions. This is not only going to entail some kind of a financial package, but it should also entail, and I am sure that my staff will confirm, a retraining element as well as assistance in relocation or the other requirements that a person needs to provide comfort at a time when they are losing their source of income.

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MR. WILSON: Have there been lay-offs?

MR. RUSSELL: Oh yes. There have been some people who have been laid off. Not a great number at this date. (Interruption) I am advised that is incorrect. Actually, there are some people who are aware they are going to leave, but they have not been issued with . . .

MR. WILSON: They have been notified in other words, have they, but not actually been laid off?

MR. RUSSELL: That is correct. I think there are some people who have been let go, Mr. Chairman, and I am thinking, not of this department at the present time, but in other departments I know there are some people who have been let go. They are perhaps not let go because they are not full-time employees, they are those on term employment or on casual employment perhaps not being recalled. As far as full-time personnel are concerned, nobody has actually been laid off as of this date.

MR. WILSON: Is there a time-frame there, Mr. Minister, in terms of contractual obligations or whatever, in order to notify these employees as to when they will be laid off?

MR. RUSSELL: Yes there is, Mr. Chairman, and as I was telling the member, I think in answer to his first question, there is a process which depends on the number of years of service, et cetera, which would determine the amount of lay-off notice they would receive.

MR. WILSON: Regarding the Nova Scotia Government Employees Union, when does the current contract with the NSGEU expire?

MR. RUSSELL: It has actually expired at the present time, and we are in active negotiations with the union.

[1:30 p.m.]

MR. WILSON: With the department considering early retirement options, will that include incentive programs?

MR. RUSSELL: Are you speaking about an early retirement option?


MR. RUSSELL: No, that option expired March 31st, for the past program. There are negotiations under way with the union, but one of the things not on the table from the government side is an early retirement package.

[Page 479]

MR. WILSON: I don't know if you will agree with this statement or not, but I am sure employees in your department and many other departments throughout this province right now are fearing for their jobs. Would you agree with that statement?

MR. RUSSELL: I would agree with that statement and it is unfortunate that these things have to occur. The member is probably aware that we have had a number of reduction programs in the Civil Service over the past many years. In fact, as you are well aware, Senator Donahoe died just the other day, and somebody showed me a clipping yesterday from the time when he was in the House back in the 1960s when they were talking about having to lay off a very large number of civil servants and the trauma they were going through in government at that time of having to lay off people who had devoted considerable time and effort and energy towards maintaining a service to the public through the Civil Service of this province.

MR. WILSON: By understanding the fear that employees have about their jobs right now, I am wondering if the department has communicated any final plans? You indicated that some people have been notified, but have you communicated any final plans for staff lay-offs?

MR. RUSSELL: No, we have not. There are negotiations under way with the union and when those negotiations are completed then lay-offs will commence. One of the difficulties I should point out is that our budget is based on an April 1st to March 31st time-frame, our fiscal year. When we prepared the budget, we recognized the fact that on day one, that is April 1st, we weren't going to lay off a whole bunch of people. In other words, it is a staged lay-off during this fiscal year.

MR. WILSON: I guess what I am trying to get at here is, we have heard all of the rhetoric and so on regarding lay-offs and budgets and cost cutting and trimming that I think there is a real human element here that has to be considered. I don't know if this is a fair question or not, but I will ask it to the minister anyway. Have you ever been laid off?

MR. RUSSELL: Have I ever been laid off? I am trying to think - I can't recall having been laid off, being normally employed under my own sponsorship, if you will.

MR. WILSON: So, you wouldn't know the feeling that would exist leading up to a lay-off, or you would never have experienced, personally, what you would go through going to work on a daily basis wondering whether or not your job would be cut, wondering whether or not you would be able to feed your family in the weeks and months to come.

MR. RUSSELL: I can appreciate what the feeling is. I have changed jobs very often in my life and normally when I have had to change jobs, I have done so under my own volition. However, I have been associated with various large organizations over most of my lifetime where I unfortunately have had to have this same experience of telling people that their services are no longer required and it is not a nice job. But I can appreciate that at least

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I still had my job whereas the person you are counselling is going to lose their job and have to start over again and I can appreciate that is a traumatic experience. It is one, unfortunately, which goes along with the times. It isn't only government that suffers the needs to reduce the workforce in massive scale, these days we hear of very successful companies which have to lay off large numbers of people and probably do it without as much attention to the people they are laying off as government does.

I was just reading about, I think it was Xerox, last week, where they are laying off 5,000 people. Those things happen in private industry, they happen in government and I think all governments right across this country anyway, have had to go through this exercise on many occasions, some of them just within the recent past.

If you are trying to save money in government, unfortunately the thing you have to cut is people because of the fact that is where about 70 per cent to 80 per cent of the costs are. You can talk all you want about not having any roads, or not having any Department of Agriculture or Department of Human Resources or what have you, but there are certain things people say you can't touch. You can't touch Health and you can't touch Education, but unfortunately, just as we in the department can't cut costs without cutting people, we can't, in government, cut costs without cutting those very large departments. It is painful, but unfortunately it is necessary.

MR. WILSON: In case you are wondering, I am leading up to something, but before I get to that point, I have had and know the feeling of what it is like to be downsized. I know what happens previous to that downsizing. You question your very existence in doing your job while you are leading up to that. The stress is absolutely horrendous and I am sure a lot of employees of the Province of Nova Scotia right now are undergoing that same stress. Has your department considered any impact that, what I just mentioned, might have on job performance of your employees, current job performance of the employees there and to the job performance of the employees who are going to be left after such a downsizing?

MR. RUSSELL: Okay, I think you make a very good point. In fact, you make two very good points. Number one is, and I will deal with your last point first, and that is the people who remain who are not let go. What we are trying to do is to reduce programs rather than employees, and I don't just say that as an exercise in semantics, but by reducing a program, you no longer have that function to accommodate or to cope with. In other words, you are not asking somebody else to pick up the load left by those who depart who deliver that program because that program is no longer there. If you reduce in that fashion rather than just taking a straight across the board 10 per cent of your employees are going to go, but do it by function. I think you are making it easier for the people or at least no more difficult for the people who remain.

[Page 481]

On your other point, the people who are being let go, who believe they are going to be let go and remain in the workforce, as you so rightfully say, their morale is not going to be that great. So it behoves us, I think, as rapidly as possible to get through this process with the unions, to get through our structuring process as rapidly as possible so people know whether they are staying or whether they are going and people can get on with the rest of their lives.

We have an employment assistance program which works with employees who are leaving to help them with retraining, but also with finding other employment. We presently have a flexible work program for present employees, for those employees at the present time who are working in areas where reductions have already taken place over the past several years and where they are finding the stress of coming into work every day is very difficult on a five day, eight hour normal time-frame. We can and we are doing and we are encouraging people to move into a flexible program so they can either work at home, they can come in early and leave early, or come in late and leave late, they could work a four day week, or they could job share. There are a number of options we can do to accommodate those employees at the present time, and there are a large number of those people at the present time within the Civil Service in areas where there have been reductions and perhaps the knife has gone too close to the bone.

There are people, particularly in the Department of Community Services who are carrying fairly large caseloads, caseloads that are probably too heavy. However, if you can give those people the option of rearranging their lives to some extent to meet a flexible work option then perhaps their life becomes much easier.

MR. WILSON: I appreciate that answer. I also like the analogy of the knife cutting a little bit too close to the bone. Again I revert back to my personal situation, where what was left was you had a case of fewer hands performing the same level of work, the same level of service, which required a tremendous effort from those who are left behind. I am sure the same is going to happen with government employees and I would go as far as to speculate that is probably going to lead to a lot of problems dealing with dealing with stress, perhaps time off due to illness or whatever the case may be. So, if your department, and as I take it, your answers, you are currently looking at programs to alleviate or perhaps eliminate that workplace stress that would be there from some anticipated overwork?

MR. RUSSELL: I don't believe that what we are doing is going to create an overwork situation, let me make that absolutely clear because, the people who will be laid off within the Civil Service under this program are related to a function that is either disappearing or else becoming much, much smaller. However, I am saying that within the Civil Service itself at the present time in some particular areas where there are certainly high stress at the present time brought about by decreases in the number of civil servants delivering a particular function, not that I am going to hammer any previous governments, but previous governments, over the past several years, have done this and we do have in the present time,

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in the Civil Service, people who are working inordinate hours and they are working in extremely difficult circumstances and there is a stress level there. We believe part of the mandate of the Department of Human Resources is to do whatever we can to resolve some of those difficulties those people face.

MR. WILSON: You used the example yourself of the Department of Community Services, where probably caseworkers would be overburdened with big loads, you are not suggesting if civil servants who happen to be caseworkers in the Department of Community Services are laid off, they are going to have less of a load there, are you? I would suggest they would have more.

MR. RUSSELL: As a matter of fact, we do. As you know, we have hired 80 new caseworkers just simply to take care of that particular situation, that is true.

Getting back to employee assistance, I don't think we should just go by that too rapidly because I think it is important people have somebody to talk to if they are under stress and they know that their livelihood is in danger. To accommodate that need we have established a 1-800 number where employees can call. It is very confidential, no record is kept except by the person who is talking to the person on the phone, and the objective of that is to give people the opportunity to share their problems. You probably know in your constituency office a lot of people come in just steaming away and sit down and talk to you, you don't solve their problem but at least you listen to them and they go out of the door reasonably happy. I think Human Resources, can I say, is something like a mother agency? What I am saying, I suppose, is they are a shoulder to cry on and a shoulder to share their problems and to provide advice as to how they should proceed and what are their best options, and those things are all available to all employees.

MR. WILSON: Unfortunately, most people who come into my constituency office come looking for work and they leave disappointed. I didn't ask for an answer there, but if you want to answer that, go ahead.

MR. RUSSELL: Well, I will answer that as a matter of fact, because I agree with you, although most of the people who come into my office I think are probably having difficulty with some type of community service problem. Secondly is certainly employment and I have no jobs to offer either. I think if you explain to people what they should be doing to try and get a job, sometimes you can help people. I know Cape Breton is entirely different than in the Valley. Your levels of unemployment are very, very different, but sometimes people have to move, sometimes people have to take retraining, some people have to do all kinds of things and lower their aspirations perhaps temporarily until they get on their feet and sometimes advice along those lines does work.

[Page 483]

MR. WILSON: Let me ask you to look at the Supplementary Detail, Page 15.2. It says the department is going to introduce performance-based pay for senior officials. Could you tell us what that program is going to look like?

MR. RUSSELL: Well, the program is not there yet and it is in the throes of development, I believe. We have a problem and let's make no mistake about it, we have people in the Civil Service at the present time who are in a certain classification and they are doing a certain job and they learn a certain skill. I can give you the name of one, the SAP program, it is a computer program that tracks inventory and . . .

MR. WILSON: The Chairman has already filled us in on that earlier today.

MR. RUSSELL: He has. Okay, then that is fine. Anyway, we have people at the level of clerks doing that job at the present time and they came into the Civil Service with limited skills, but by virtue of their own initiative and the assistance of the department they have upgraded their skills and they are very skilled people and very, very much in demand. Quite frankly, those people are in demand not only by government, but by the private sector. It scares the heck out of me that we can lose those people. People who we have and when I say we, I mean the government, the people of Nova Scotia, invested a lot of money and training to gain these skills to run this program, yet, we have them at that level. That is not right. They are going to have to be reclassified and they are going to have to be paid at a rate commensurate with their value as well as their skill level.

The same thing applies when you get into management. You have good managers and you have bad managers and although I don't think we have too many bad managers in the Civil Service, we do have some bad managers. It is not fair to say that because a person is at a certain level and has spent so many years on the job and by virtue of incumbency - and not producing very much - is entitled to as much as the person next to them who is producing. So we have to have some kind of an incentive program and that is what this is going to do.

If I can bring one more example perhaps that you are probably aware of was the business with the Crown Attorneys. A very specialized job, not a particularly joyful job, I wouldn't imagine. Anyway, you have to be a lawyer, but you have to be a very special kind of lawyer and in the Civil Service as you know, we pay all lawyers the same. The Crown Attorneys led by a member, who is now a sitting member of the New Democratic Party, went out and battled for three or four years, maybe even longer for a special salary for the Crown Attorneys and quite frankly, we finally saw the light. I don't know if it was your government or our government that saw the light and finally provided that additional salary. An incentive program does indeed encourage those who want to put forward that extra effort.

MR. WILSON: That is the performance-based program we are talking about, for senior officials, is that correct?

[Page 484]

MR. RUSSELL: I don't know, I am all over the place. But, anyway, I am talking about - what am I talking about - implement pay-for-performance for senior officials.

MR. WILSON: Senior officials.

MR. RUSSELL: I see the Crown Attorneys are in here as well, so, I obviously didn't read this page very well. You're looking at implement pay-for-performance for senior officials?

MR. WILSON: Yes, correct. Also, you did touch on that, you are also trying to reach an agreement, a Memorandum of Agreement with the Crown Attorneys, correct?


MR. WILSON: Okay, but on the senior officials . . .

MR. RUSSELL: Senior officials. That is a program that is presently under development and it will be forthcoming. We made a commitment in our blue book and I am sure the honourable member for Dartmouth North has got that one ticked off to institute that particular program.

MR. WILSON: You will get your turn. Again, I am concentrating on the words senior officials. At a lower level, civil servants, they won't be given the same opportunity to participate in this program?

MR. RUSSELL: Yes, they will be because as I told you, we are looking at a reclassification program. This is a program in conjunction with the NSGEU for all employees and at the same time we will indeed be looking at some kind of reward for exceptional performance.

Getting back to the compensation policies for senior civil servants, we work under a program - the Hay Program - for determining salaries of senior officials of government and that program has to be updated. It is a very old program, in fact I think it must be about 20 years old now. The thing is that we have to be competitive with the private sector and that is one of our difficulties for instance when we are recruiting deputy ministers that our salaries sometimes are not commensurate with those that are paid by the private sector for the same range of responsibilities, same number of personnel under their control, the same amount of financial control that they exercise.

The Hay system works on your spanner control, the number of employees and the amount of money that you directly control and a number of other things and you lump them all that together and you come up with a number and that is the private sector going rate.

[Page 485]

MR. WILSON: Mr. Chairman, how much time do I have left?

MR. CHAIRMAN: You have one and one-half minutes.

MR. WILSON: Not enough time. Well, quickly, do you know how much that performance-based pay is going to cost taxpayers? Do you have an indication of how much money it is going to cost?

MR. RUSSELL: No I don't, but I would think we would probably be looking at it being cost neutral.

MR. WILSON: But you are not sure?

MR. RUSSELL: I am not sure because the program has not as yet been completely developed. As I say, it is a work in progress and when that is completed, we will indeed have hard numbers as to what the program will cost.

MR. WILSON: Just quickly, since you did refer to the Crown Attorneys and trying to reach a Memorandum of Agreement there, any estimate on what that might cost?

MR. RUSSELL: That is already in place, as I understand. At the moment we pay a market adjustment to Crown Attorneys which brings them up to a comparable level with other people in the private sector and the private law firms doing that kind of work. The final agreement has not as yet been signed.

MR. CHAIRMAN: Thank you very much. The time allotted for debate on the Subcommittee in Supply has now expired.

[1:57 p.m. The subcommittee rose.]