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March 23, 2007



Speaker: Honourable Cecil Clarke

Published by Order of the Legislature by Hansard Reporting Services and printed by the Queen's Printer.

Available on INTERNET at

First Session

FRIDAY, MARCH 23, 2007

Res. 1941, Estimates - CWH on Supply, Hon. M. Baker
Hon. M. Baker 3609
Mr. G. Steele 3628
Ms. D. Whalen 3636
Referred to CWH on Supply 3645
ADJOURNMENT, House rose to meet again on Mon., Mar. 26th, at 2:00 p.m. 3645
Res. 2084, Ells, Leta & Glenn/Newcombe, Marion & John: Liberal
Party/N.S., Contribution - Congrats., Mr. M. Samson 3646
Party/N.S., Contribution - Congrats., Mr. M. Samson

[Page 3609]


Sixtieth General Assembly

First Session

1:00 P.M.


Hon. Cecil Clarke


Mr. Wayne Gaudet

MR. SPEAKER: Order, please.




[Res. No.1941, re Estimates - CWH on Supply - notice given Mar. 21/07 - (Hon. M. Baker)

MR. SPEAKER: The honourable Minister of Finance.

HON. MICHAEL BAKER: Mr. Speaker, pursuant to a notice of motion given by me on March 21, 2007 and the Rules and Forms of Procedure of the House of Assembly, I have the honour, by command, to present a message from Her Honour the Lieutenant Governor of the Province of Nova Scotia, relating to the Estimates of sums required for the service of the province for the fiscal year ending March 31, 2008 which is:


[Page 3610]

"I hereby transmit Estimates of Sums required for the Public Service of the Province for the year ending March 31, 2008, and in accordance with the Constitution Act, 1867, recommend them, together with the budget address of my Minister of Finance and any resolutions or bills necessary or advisable to approve the Estimates and implement the budget measures, to the House of Assembly.


Mayann Francis

Lieutenant Governor

March 23, 2007".

Mr. Speaker, at this time, I wish to table the message from Her Honour the Lieutenant Governor, transmitting the estimates for the consideration of this House, table the Government Business Plan, table the Estimate Books, table the Crown Corporation Business Plans, table the Estimate and Crown Corporation Business Plan Resolutions, deliver my Budget Speech, move that the Estimate of Sums required for the service of the province for the fiscal year ending March 31, 2008, being Supply, to be granted to Her Majesty and the Crown Corporation Business Plans, be referred to the Committee of the Whole House on Supply.

MR. SPEAKER: The documents are tabled.

The honourable Minister of Finance.

HON. MICHAEL BAKER: Mr. Speaker, before I begin my Budget Address, I would like to make some introductions. First of all, I would like to introduce in the Speaker's Gallery today, some people who are very special to me. First of all, my mother and father, Gilbert and Barbara Baker; my wife, Cindy Baker; my two sons, Matthew and Daniel, who I am pleased to say are becoming experts now in the ways of the House, perhaps against their will. (Laughter); my brother, Peter and sister-in-law, Paula; my niece, Samantha and my nephews Alex, Andrew and Stephen. I would also ask them to rise and receive the welcome of the House. (Standing Ovation)

Mr. Speaker, in the east gallery, I guess they aren't in the east gallery but they are in the Speaker's Gallery as well - I have today some staff from my constituency office and that would be Ginny Penny and Dale Keddy and also my executive assistants, Kim Langille and Jeff Garber. All of them provide me with great support every day.

Mr. Speaker, I would also like to take time to recognize all of the staff from the Department of Finance and all the staff of the Treasury and Policy Board who helped me prepare this year's budget. In particular, I would like to thank Vicki Harnish, Deputy Minister of Finance; Liz Cody, Assistant Deputy Minister of Finance; Margaret MacDonald, Assistant Deputy Minister of Treasury and Policy Board; also Cathy Shaw and Donna Chislett who have been very involved with budget communications this year. I know there

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are a number of other people from the department there and they have all been very helpful in the preparation of this year's budget and I would like to give them a round of applause to know so. (Applause)

[1:15 p.m.]

Mr. Speaker, getting a budget ready is a monumental task in every year but I think it is fair to say, at least for this group of staff, that 2007 will be a budget year to remember. I would also like to thank those people who are not able to be here today in the House but who have worked on this process.

I rise in the House of Assembly to present the Province of Nova Scotia's 2007-08 budget.

Mr. Speaker, this is a good budget for Nova Scotia. It is a budget that is focused on today and tomorrow. It is an effective plan, one that advances the Premier's vision for the new Nova Scotia, one that will create winning conditions through a globally competitive business climate, workforce, and connections; one where we can seize new economic opportunity by being a leader in information technology, research and development, innovation, and in the clean and green economy and; one that will support Nova Scotians in their efforts to become healthier and more active, in safe and accessible communities, neighbourhoods, and workplaces.

Mr. Speaker, the budget is disciplined and it is strategic. We have contained costs. At the same time, we are making significant investments in this province and its people that will create opportunities for many years to come. Nova Scotia has had good financial results in recent years, and we will see that continue. That is why we have made debt reduction, one of our top priorities for today's budget.

Nova Scotia's debt was built up through the 1980s and 1990s, as successive governments ran annual operating deficits, sometimes in the hundreds of millions of dollars. Every year, those governments borrowed a lot of money just to pay their bills. And they left behind a massive debt. It has taken many years of hard work to reverse the damage to our finances.

In 2000, we passed a law requiring balanced budgets in Nova Scotia. We have produced surpluses in each of the last five years, all of which went straight to the debt. In 2005, we received $830 million from the government of Canada for the hard-fought Offshore Accord, and we chose to apply it to the debt. In the same year, we created the Debt Reduction Plan, with a goal to start bringing down the debt this fiscal year.

Mr. Speaker, this work is now paying dividends. We have reduced annual net debt-servicing costs from $890 million in 2004-05 to an estimated $840.8 million in 2007-08.

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(Standing Ovation) Nova Scotia's net direct debt as a percentage of gross domestic product has also declined from 46.8 per cent to a forecasted 38.1 per cent for March 31, 2007.

Simply put, Mr. Speaker, we have more money to spend on our programs, now that less money is spent on interest payments. However, we still have work to do. Nova Scotians still carry among the highest debt per capita in the country. And that's why we are focusing on debt reduction now. Debt reduction is not an easy thing to do, but it is the right thing to do. It's time to start paying the bill, on behalf of all Nova Scotians. And we must create the right conditions in Nova Scotia to pay it off completely, on behalf of our children.

We are on the right financial track to do that, Mr. Speaker. But the Government of Canada has failed to fix the fiscal imbalance. This, despite their pledge to fix the fiscal imbalance in this country. Despite their promise and obligation to allow Nova Scotians to use our own offshore revenues to continue on the road to self-sufficiency. Measures in the federal budget will widen, not close, the gap that exists between the richer and poorer provinces in this country.

The new federal equalization formula essentially forces Nova Scotia to give up a portion of potential future revenues that were guaranteed under the Offshore Accord. And new methods of allocating other federal transfers, based on a cash amount per capita, actually favour the more populous provinces like Alberta and Ontario - the ones that already have a far greater fiscal capacity relative to Nova Scotia. The best example of this is the Canada Social Transfer, which is used to cover the cost of higher education and social services. The federal government will increase national CST funding for post-secondary education by $800 million in 2008-2009. But Nova Scotia will see only $6 million more.

The federal government has technically given us options for equalization this year. We can either stay with the existing formula - and get less - or elect to take the new formula - and take increased revenues in the short term. But really, it's not much of a choice. We must take the important increase in federal funding this year. Otherwise, we would be forced to dramatically raise taxes or cut programs.

Mr. Speaker, we are continuing discussions with the federal government and are prepared to look at all options available to us before we have to formalize our choice later this year. We also welcome the unanimous all-Party support we received in the House this week, calling on the Prime Minister to honour the true intent of our Atlantic Accord. We will require the support of Nova Scotians to challenge the formula's unfairness. As the Premier has stated, we will continue to fight vigorously to restore the Atlantic Accord. (Standing Ovation)

Mr. Speaker, we are fortunate that Nova Scotia has had good economic results in recent years. We are proud of the responsible fiscal management that has created good solid opportunities for Nova Scotians. A total of 46,000 jobs have been created since July 1999, and employment reached a record high of 450,800 in February 2007. Unemployment is

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expected to remain steady at eight per cent. And Mr. Speaker, the outlook remains positive. We expect real growth of 2.3 per cent, along with low interest rates and inflation.

Nova Scotia will benefit from healthy Canadian and U.S. economies and revenues from offshore energy investment. Exports of goods and services are expected to increase by 3.5 per cent this year.

Mr. Speaker, I am pleased to report that our strong economy and good financial management have allowed us to end the current fiscal year with positive results. We are forecasting a surplus for 2006-2007 for the fifth year in a row. (Applause) The surplus is forecast to be $98.5 million, allowing us to make a substantial payment on the debt once again. Total net expenses in 2006-2007 went up $29 million to $6.9 billion. This was mainly due to higher program and pension expenses, and these were offset by savings in debt-servicing costs. Meanwhile, total revenues are forecast to rise to $6.627 billion.

Mr. Speaker, government made a choice last year to increase our capital spending budget. We invested a total of $406.4 million on capital projects, adding $71.4 million to the original appropriation of $335 million for tangible capital assets, also known as TCA. This allowed the province to move more quickly with much-needed roadwork and school construction and to take advantage of opportunities to preserve new Crown land. This extra capital spending resulted in a higher net direct debt for 2006-07, compared to the original budget.

Mr. Speaker, we have established a number of objectives for this fiscal year, and I am happy to report to the House that we have met them. Our budget is balanced for the sixth year in a row. (Standing Ovation) Our debt reduction plan is on track. And perhaps most important, we are providing sufficient resources to fund the key programs and services our citizens rely on. And, we're doing it without increasing income taxes or cutting programs. We are making sufficient investments now to ensure our province prospers in the future.

The 2007-2008 budget will see total net program spending of $6.38 billion, up 6.5 per cent over last year. This represents significant and substantial investment. Department of Health spending will increase to $2.91 billion. Spending on Education, including assistance to universities of $250.8 million, will total $1.439 billion in 2007-08. This is 5.4 per cent over last year's budget. The budget for Community Services is $781.8 million: a full $33.7 million or 4.5 per cent higher than last year. Spending on tangible capital assets is estimated at $254 million.

Our net direct debt for 2007-08 is estimated to be $12.414 billion, $20 million lower than budgeted in 2006-07. (Standing Ovation)

We anticipate total ordinary revenues of $7.03 billion in 2007-08. This is $440.7 million, or 6.7 per cent, higher than last year's budget. Mr. Speaker, we are projecting a surplus of $118.4 million. This surplus is necessary to meet our debt reduction target.

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Mr. Speaker, we considered many scenarios in planning this budget, including some less positive than the end result. We are not increasing income taxes, either for individuals or businesses, and, in fact, have been able to move forward with the decreases promised in last year's budget. However, we are undertaking a number of measures to offset significant increases in operating expenses.

[1:30 p.m.]

Mr. Speaker, our government pension plans must be adequately funded to ensure employees get the benefits they are entitled to when they retire. Recent actuarial assessments of the Public Services Superannuation Plan indicate that contributions to the plan are not keeping up with the cost of services. We will therefore increase contributions by 2.42 per cent of salary costs, effective April 1. The cost of this increase will be shared equally by the employer and employees.

Mr. Speaker, the Government of Nova Scotia will increase most user fees and government charges by 6.8 per cent, effective, in most cases, on April 1, 2007. The last government-wide increase to user fees and government charges was in April 2004. This measure will help offset the overall rising costs of government programs and services. The amount is tied to inflation over the last three years. In addition, I want to inform the House that we will support legislation to provide notification to the House, and an opportunity for discussion, regarding any future increase in existing user fees.

Government continues with ongoing measures to reduce tobacco consumption, according to the provincial tobacco strategy. Effective today, the province will increase tobacco taxes:1 cent per cigarette or the equivalent of two dollars per carton; 1 cent on the pre-proportioned tobacco sticks; 1 cent per gram on fine-cut tobacco.

Effective today, the province will increase the tax rate applied to fuels used in aircraft from 0.9 cents per litre to 2.5 cents per litre. This will bring Nova Scotia's aviation fuel tax rate in line with other provinces. The increase is expected to generate an additional $2.4 million in revenue. We are very conscious of the need to make Nova Scotia's tax system more competitive with the rest of the country. We are making Nova Scotia a more attractive place to live and do business. With this in mind, we will proceed with a series of measures to ease the tax burden faced by Nova Scotians and to encourage business investment.

Mr. Speaker, our government demonstrated last year that we take very seriously the impact on Nova Scotians of increasing energy and heating costs. The Your Energy Rebate program, announced in last year's budget, was started a month early to ensure that Nova Scotians would realize greater benefit of this program during the winter heating season. This program rebates to consumers, the equivalent of the provincial portion of the HST on a variety of energy products including electricity and home heating oil. This year's budget will cover the full annual cost of the program, leaving $68.2 million in the pockets of Nova Scotians and easing the financial burden of about 400,000 families. (Applause)

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As promised in last year's budget, we will move forward with increases to Nova Scotia's basic personal exemption and other provincial credits. These changes will put approximately $20 million back into the hands of taxpayers this year. The basic personal amount exempted from personal income taxes will be $7,481 in 2007, $250 more than last year. There will also be a 3.46 per cent increase in other non-refundable tax credits, including the spousal amount, dependent amount, pension amount, disability amount, and caregiver amount.

Mr. Speaker, we want to encourage our university and college graduates to remain in Nova Scotia to work after graduation. Therefore, we are doubling the Graduate Tax Credit to $2,000 in 2008. Total tax relief for graduates is expected to cost $10.9 million in 2007-08. (Standing Ovation)

We are also following through on our promise to reduce the Large Corporations Tax to 0.225 per cent this year and will eliminate the tax by 2012.

We are introducing a new Digital Media Tax Credit to support digital media producers and encourage them to hire Nova Scotia workers. The intent is to give these companies a 35 per cent credit on eligible Nova Scotia expenditures, similar to the one provided for film production in Nova Scotia.

As promised, the province will introduce a refundable tax credit for volunteer firefighters for the 2007 taxation year, in recognition of the essential role they play in our rural communities. That credit will be $250 in 2007 and will increase to $375 in 2008 and $500 in 2009. (Standing Ovation)Volunteer firefighters across the province will collectively receive an estimated $2.3 million benefit in their 2007 taxes. Mr. Speaker, this is cash in their pockets.

To restore the competitive advantage to Nova Scotia's tour and convention industry, government will introduce a provincial program to parallel the Foreign Convention and Tour Incentive Program announced by the Government of Canada on March 19th.. Mr. Speaker, over the next year we will work with Canada Revenue Agency to develop a means of recognizing, for tax credit purposes, additional groups of medical professionals, such as naturopaths, whose services are part of a course of medical treatment.

Mr. Speaker, the new Nova Scotia will be a strong player in the global economy. This budget is about focusing on what we do best in Nova Scotia. We want to do it better than anyone else and to look to both the short and the long term. It's about creating the winning conditions for prosperity, seizing new economic opportunities, and building active, vibrant, and healthy communities.

Mr. Speaker, in order to position Nova Scotia to compete globally, we must invest in areas where we have solid foundations that lend themselves to future growth and that give our businesses and our people the support and encouragement they need.

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Mr. Speaker, the link between living a healthy lifestyle and enjoying good health is undeniable. If we want Nova Scotians to practise good health habits, we must provide places for them to be physically active, enjoy recreation, and play sports. Just over two weeks ago, the province and our partners at Halifax Regional Municipality reached the disappointing, but necessary, decision to withdraw our bid for the 2014 Commonwealth Games. It was a prudent financial decision. However, it served to highlight the need for more and better recreational facilities in Nova Scotia. Too many communities rely on facilities that were built in the 1950s and '60s and can no longer meet their growing needs.

Mr. Speaker, I am announcing today that our government is embarking on a 10-year, $50-million program to build, replace, and upgrade recreation facilities in Nova Scotia. (Standing Ovation) This program will be equally cost-shared with municipalities and communities, which could bring the investment in our communities to $150 million over the next 10 years. With the existing $3-million recreational facilities development program, this will mean $8 million in provincial funding alone available for 2007-2008.

Mr. Speaker, growing the economy requires continued planning and solid investment in infrastructure. Since 1999, we have made significant progress in improving and enhancing our roads and highways, our schools, hospitals, and technological infrastructure. We have made important land purchases, preserving natural spaces that Nova Scotians value. We will build on that progress this year. We will spend more than $254 million on tangible capital assets for Nova Scotians and another $38 million in grants to district health authorities to address hospital needs across the province.

A total of $145 million is earmarked for highway construction in 2007-08. This includes continued work on the twinning of Highway 101 and of Highway 104 between New Glasgow and Sullivans River. There will also be more upgrading on Trunk 4 between St. Peter's and Sydney. In addition to new construction, $186 million is dedicated to road maintenance this year - asphalt patching, ditching and gravelling - and smaller improvements such as intersection and signals, small bridge repairs, and repaving.

Mr. Speaker, it is also important to recognize the importance of carrying out any development in an environmentally sound manner. While the development of a by-pass to connect Highways 102 and 103 near the Hammonds Plains and Sheldrake Lake areas is still at the proposal stage, we intend to move forward with an environmental study on the Blue Mountain Grove Wilderness Area.

Mr. Speaker, we continue to invest in infrastructure to support the education of our children with $58.5 million more this year in healthy, sustainable school facilities. We will complete construction of two new schools: Harbourside/Robert Jamieson and Citadel High; continue construction of two new school projects: Musquodoboit High and Harmony Heights Elementary; and begin construction on four new school projects: Stewiacke East Elementary, Truro South Elementary, Oxford High, and Northside Elementary.

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The additions and alterations program will enhance or replace major school building components in 11 schools this year to address building condition and environmental and program issues. Mr. Speaker, we have committed just over $18 million to improve government buildings that provide essential services to the public, including: construction of new justice centres in Lunenburg County and Yarmouth; construction and improvements to provincial buildings in Stellarton and Lunenburg, and; repairs on historic Government House.

Mr. Speaker, I want to inform the House today that as we move forward, we are committing to make all provincially owned buildings in Nova Scotia barrier free for public access by 2020.

Mr. Speaker, infrastructure investment is no longer as simple as bricks and mortar. It also includes the networks that fuel business transactions and connect us to markets around the world. We are making important commitments to the continued development of our information technology systems on a number of levels.

This year, government IT projects totalling $10.87 million will be funded to enhance efficiency and improve services to Nova Scotia. They include: continued implementation of a common health administration system for Nova Scotia's district health authorities; a comprehensive IT application, called Panorama, that will help public health professionals with managing public health information, particularly in a crisis; a case-management system to improve client-service delivery at Community Services; an integrated system to improve services to customers at Service Nova Scotia and Municipal relations; and $225,000 for a new database for field staff conducting food safety inspections.

Mr. Speaker, investing in technology is a tangible way to build a sustainable and competitive Nova Scotia. It benefits every citizen, business, and community. This year, we will be investing $10 million to begin bringing broadband access to every area of this province by the end of 2009. (Standing Ovation) The work has already begun. A pilot project in Cumberland County has brought wireless technology to a number of communities. This project will help us develop a model to achieve broadband access that is both commercially viable and sustainable.

This is important, Mr. Speaker, because we understand IT infrastructure connects Nova Scotia to the world. It helps strengthen and diversify our economic base. To further this development, the province will invest in innovation for small- and medium-size businesses, particularly in rural Nova Scotia. We will provide financial assistance to support investments in new applications, technologies, and equipment by expanding the I-3 program administered through InNOVAcorp. All told, these investments are worth $1.2 million.

Mr. Speaker, we are working to create winning conditions through a globally competitive business climate, workforce, and connections. In the not-too-distant future, a North American trade and transportation gateway to Europe and western Asia will be

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developed somewhere on the East Coast of this continent. We are working to ensure that the Atlantic Gateway is established here in Nova Scotia. (Standing Ovation) The Atlantic Gateway represents a once-in-a-generation opportunity to create the conditions for long-lasting prosperity and economic growth.

Mr. Speaker, we were pleased to see the federal government make funding available in its budget for gateway projects, and it is fitting that they should, as this is a national - not a regional - undertaking. However, Mr. Speaker, it is important that we maximize our own efforts and seize this opportunity. This year, this government will spend $1 million to develop and advance the Atlantic Gateway. It is well known that in every state and province in North America, governments are actively involved in job creation and encouraging business development.

Since its inception, Nova Scotia Business Inc. has created and maintained close to 18,000 jobs with a potential total payroll impact of about $600 million. The direct tax impact to Nova Scotia is $70 million each and every year. Last year, as an example, NSBI attracted four of the world's leading financial services and insurance companies to Nova Scotia. This year, NSBI will build on its success and begin to implement a new five-year plan for business attraction that will guide the organization through 2012.

We have also made changes to the eligibility criteria for the payroll-rebate program for small and medium-sized businesses, which reduce the number of jobs required by half, from 50 to 25, as an incentive to business investment, particularly in rural Nova Scotia. And, Mr. Speaker, we hope to be able to lower that number even further in future budget years.

Nova Scotia Economic Development will also continue good work this year to support job creation and research and development in Nova Scotia. Over the past three years, some 3,600 jobs have been created or maintained through investments made by the Industrial Expansion Fund. As well, we will provide more funding this year to the Research and Innovation Trust for world-class research projects like the Atlantic Computational Excellence Network and the Brain Repair Centre.

We will also increase our student employment program by $800,000 this year, to a total of $2.3 million. This means more new jobs for Nova Scotians, bringing the total to more than 600 students working across Nova Scotia. And, Mr. Speaker, we will invest $750,000 to revive Nova Scotia's winter works program, which will offer wage subsidies to businesses, municipalities, and not-for-profits, to allow them to hire unemployed and under-employed individuals. This has the potential to provide hundreds of jobs across the province and help create economic activity in areas of high unemployment.

Opportunities for Sustainable Prosperity (2006) sets Nova Scotia on an economic development path that integrates economic, social, and environmental systems. We know our offshore offers Nova Scotia good business opportunities. This year, we will pursue a new

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strategic offshore marketing plan that will showcase offshore opportunities to prospective investors and put new geological ideas in front of both current and potential explorers.

To build on this opportunity this year, we are providing $250,000 to digitize and process our government-owned Sable area seismic data. To enhance productivity and opportunities in the agricultural and fishery sectors, we are investing in more research. This year we will provide an additional $50,000 for lobster research programs and $175,000 for salmon research at the Margaree River Hatchery. In addition, farmers who are retiring debts incurred under the Ruminant Loan Program and the Pork Nova Scotia Loan Program will be eligible for $6.2 million in grants beginning in April 2007. (Standing Ovation)

Mr. Speaker, agriculture in Nova Scotia has no greater friend than the honourable member for Colchester-Musquodoboit Valley. Our colleague, the Minister of Agriculture, is a passionate and persistent advocate for Nova Scotia's agriculture producers. He articulated to government a compelling picture of the many challenges faced by Nova Scotia pork producers. We all wish he was able to hear this budget presented today. (Applause)

The provincial hog industry has experienced a number of issues in recent years, including excess supply in North America, the strong Canadian dollar, and rising production costs. The industry's fundamental disadvantage continues to be transportation costs for feed grain. That's why we are providing an additional $500,000 to Nova Scotia's pork producers to assist in income support to help them make the transition to profitability.

Mr. Speaker, I want to be clear: the government is committed to supporting Nova Scotia's agriculture industry as it moves toward a greater prosperity and self-sufficiency. In fact, we will hire industry liaison officers who will work with the farming community to address pressing issues in the agriculture industry.

Finally Mr. Speaker, we want to encourage Nova Scotians to continue to support their own farming and fishing industries. This year we have allocated $250,000 to establish a marketing program designed to encourage Nova Scotians to "buy local."

Mr. Speaker, for Nova Scotia to truly succeed, we must have a competitive environment for doing business. Government must work with the business community to foster innovation, creativity, and resourcefulness.

Mr. Speaker, we are very pleased about the progress we have made through a number of Better Regulation initiatives underway across government. This includes the $900,000 Competitiveness and Compliance Initiative to help businesses and other organizations comply with provincial laws and regulations. In addition, government will also invest $100,000 this year in BizPaL, an on-line service that makes it easier for business to find and apply for permits and licences by the business sector.

[Page 3620]

We are also taking innovative new approaches to traditional industry sectors, actively marketing our assets and identifying new opportunities. We will spend $2.5 million more for tourism marketing and product development. This is consistent with our new tourism plan, New Realities, New Directions, developed in conjunction with the industry through the Tourism Partnership Council. This funding, together with additional investments in marketing and attractions, will create more opportunities for our tourism sector.

In agriculture, we are providing $750,000 to the Strategic Infrastructure Investment Fund, which supports and promotes good business management and market readiness in the agricultural sector.

Mr. Speaker, the province's investment in the education of its people, at all stages of their lives, is at the heart of its strategy for a vibrant, prosperous, and sustainable Nova Scotia. Nova Scotia's public school system addresses the needs of primary students experiencing school for the first time through to high school students preparing for their lives as adults. This year, government will invest an additional $34 million in Nova Scotia's public education system, an increase of 5.2 per cent per student.

Mr. Speaker, to accommodate our youngest learners, we will continue our pre-primary pilot this year, while moving forward with a study of the needs involved with moving Nova Scotia's Grade Primary age eligibility from September 30th to December 31st of the school year. We will implement the change in time for the 2008-09 school year.

We will also continue to invest in the health and well-being of future generations by supporting physical education programming at all grade levels. This year, another $300,000 is being committed to hiring more phys-ed teachers across the province. And for our older students, we will enhance our commitment to the Options and Opportunities program, giving high school students a greater choice in identifying the educational path that best suits their interests and future career plans. This year, we will invest up to $1.3 million to further expand choices for hands-on learning in the areas of vocational and composite programming. When implemented, the new programming will offer students opportunities for trade-specific learning in the areas of metals, wood, plumbing and pipefitting, and electrical work.

[2:00 p.m.]

Mr. Speaker, completing our commitments to supporting families whose children have specific needs that cannot be met within the regular school system, the province is also allocating $350,000 to provide funding for a permanent third year of tuition support. This program enables these students to benefit from specialized expertise that is available at a designated private school for up to three years. Tuition support is one of our many Learning for Life initiatives that help students with special needs.

This year, we will also complete the implementation of the Black Learners Advisory Council (BLAC) Report. We are investing an additional $1.6 million to ensure that the good

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work of this group continues to enhance learning opportunities and outcomes for the province's African Nova Scotian student population.

Mr. Speaker, we continue to work with our school boards, our partners in education, to complete the transition to a new school board funding formula with the allocation this year of $2.35 million to this process. In 2007-08, the Halifax Regional School Board, the South Shore Regional School Board, and the Conseil scolaire acadien provincial will benefit fully from the transition to the new formula recommended by the Hogg Report.

Mr. Speaker, another key aspect of Nova Scotia's lifelong education system is the emphasis on ensuring that the province has the skilled workforce it needs to grow its economy. Government continues to make significant strategic investments in education and skills training to develop a skilled workforce in Nova Scotia. This year is no exception. Total provincial funding for post-secondary education has grown from $340.2 million in 2003-04 to $447.2 million in 2007-08. This includes funding to universities, the Nova Scotia Community College, spending on skills and apprenticeship programs, and support to students.

Mr. Speaker, this year, overall, the Nova Scotia Community College system will receive an additional $13.5 million, an increase of 15.3 per cent. This includes $4.84 million to create 591 more student seats across Nova Scotia, with a particular focus in the areas of skilled trades and information technology training.

In addition, recognizing that skilled tradespeople are in tremendous demand, we are investing $3.6 million in strengthening Nova Scotia's apprenticeship training system and making it accessible to more people. Nova Scotia's skilled trades workforce will play an important role in the province's economic growth over the coming years, and this is an area of tremendous employer demand.

In the area of university education, we are increasing our funding in this year's budget by $22.9 million, or 10.1 per cent, to ensure that more Nova Scotians can enjoy the benefits of higher education. Mr. Speaker, $12.5 million of those funds will be used to offset the 3.9 per cent tuition increase scheduled for the 2007-08 school year. This will result in a tuition freeze at September 2006 levels for most Canadian students and an equivalent reduction in tuition rate increases for medical, dental, law, and international students; an additional $11.6 million will be used to provide a student bursary of $500 for Nova Scotia residents attending Nova Scotia universities.

This is the next step in this government's commitment to bring Nova Scotia tuition rates in line with the national average by the 2010-11 school year. And, Mr. Speaker, the province is further investing to help students access affordable loans to help finance their university education. As a result of last year's reduced parental contribution amount and changes to the formulas used to calculate student loan eligibility, we anticipate issuing $2 million more in student loans this year.

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At the same time, the province will introduce a new Repayment Assistance Program that will help graduates who are having difficulty repaying their loans reduce their expected payments to more manageable levels. And the province will begin shortly to directly fund the Nova Scotia Student Loan Program in order to provide lower interest rates to student borrowers. Finally, Nova Scotia is introducing a new multi-year needs-based grant program in 2007-08 to help students from low-income families to fund their second, third, fourth, or fifth year of studies.

Mr. Speaker, good, quality health care remains a priority for Nova Scotians, and indeed for all Canadians. This year we are committing almost $3 billion on Health and Health Promotion and Protection - more than ever before. Health care spending has increased by over 8 per cent per year over the past decade. In this budget, we have to balance not only the needs within the health system, but also the competing, and equally important needs, of all government services. So this year we have limited the increase in health care spending to 5.3 per cent.

That being said, we are providing sufficient funding to maintain the existing health care programs and services that Nova Scotians count on every day, while increasing investments in priority areas such as home care and long-term care, oncology, and equipment and infrastructure.

Mr. Speaker, we invest more every year in cancer treatments and supports. We have purchased equipment such as linear accelerators and MRIs and last year funded three new oncologists for the province. We have expanded oncology clinics for Inverness, Antigonish, New Glasgow, and Yarmouth and are investing to provide a new oncologist for Kentville so patients can receive care close to home.

Mr. Speaker, we've also invested in new digital screening equipment and a central booking system to increase access to mammography screening and assist women in getting more accurate test results, sooner. This budget will augment the existing measures. We will invest $300,000 to develop and establish a colorectal screening program, as recommended by Cancer Care Nova Scotia. We will add another $2.7 million, primarily for oncology operations at Capital Health and the Cape Breton District Health Authority. This investment will help expand staffing to better respond to the needs of patients and their families. This includes RNs, radiation therapists, social workers, and other support staff.

Mr. Speaker, one of government's goals is to make Nova Scotia a safe and healthy place to live, work, and raise families. We are committed to renewing the public health system, in part through a larger budget for the Department of Health Promotion and Protection.

This year, we will appoint a Public Health Leader, develop a Population Health Assessment and Surveillance Responsibility Centre, and work on coordinated and comprehensive emergency preparedness and response plans. This will add to our knowledge

[Page 3623]

about the threats and opportunities we face as we proactively look to improve our health standing.

Mr. Speaker, immunization is a cornerstone of modern public health and is fundamental to building a healthier Nova Scotia. In fact, immunization is a proven and effective way to prevent many forms of childhood and adult diseases. Government has an obligation to protect Nova Scotians, when possible, from preventable diseases.

Nova Scotian women suffer from the highest incidence of invasive cervical cancer in Canada. The human papillomavirus causes almost all cervical cancers, which kills about 400 Canadian women each year. But there is new hope in the fight against this disease. A vaccine has been developed that is proven to decrease the incidence of cervical cancer, and Mr. Speaker, we will begin an HPV immunization program for young women in Nova Scotia this year.

Working within a federal program, we will spend almost $3 million to vaccinate girls and young women as part of our school-based immunization program. The HPV vaccine will form an integral part of our provincial immunization program and will support our overall goal of making Nova Scotians as healthy as possible.

Strengthening environmental health protection is a key component of improving public health. And, Mr. Speaker, government will add close to $755,000 more to environmental health protection activities across the province. This provides funding for more inspectors and other staff to promote food and drinking water safety standards.

We know that for many Nova Scotians being healthy means relying on prescription medications. And for some, paying for medication is a burden. That is why we are making a significant commitment of $189.6 million this year to Pharmacare. This includes: $134.9 million for Seniors' Pharmacare, about $2 million more than last year; $52.7 million in Pharmacare for income assistance recipients and their dependents, and; $2 million in Pharmacare for children of low-income parents.

We will also spend $5 million this year to develop a new, publicly subsidized prescription drug insurance program for working families. This expansion will almost double the number of Nova Scotian families who are eligible for Pharmacare. (Applause)

Mr. Speaker, like other Canadians, we value a quality health care system, with access to care by excellent caregivers. Investment in these health care workers represents nearly three-quarters of the Health budget and is a major contributor to rising health care costs.

[2:15 p.m.]

We are proud to have funded significant increases in wages, health benefits, and pensions over the last decade. In fact, in most cases our health-care workers are leading their

[Page 3624]

counterparts in Atlantic Canada when it comes to compensation. This, year we will spend an additional $45.6 million to cover negotiated settlements for wages, salaries, and benefits in the health care sector.

Mr. Speaker, seniors are the fastest-growing segment of Nova Scotia's population, and we have a large number of people with disabilities. In this, the second year of our Continuing Care Strategy, we will develop and expand a number of services and programs to serve the needs of our seniors.

First, Mr. Speaker, through this year we will establish a Department of Seniors, which will advocate, develop policy, and coordinate programs for our senior citizens. We will add another $800,000 to the budget for seniors, bringing funding for seniors to $2 million, as we undertake this new development.

Other commitments include: $3 million to expand respite programs that will provide relief to caregivers, enabling them to continue to provide care; $2 million for a provincial adult day program to enable caregivers to continue caring for family members and others; plans to create 832 new long-term-care beds and work with service providers to replace 721 beds in aging facilities, and; $4 million for the Expanded Home Repair/Adaptation Program, to help seniors make repairs and renovations to address health and safety issues in their homes.

Mr. Speaker, many seniors simply need a helping hand to remain in their own homes instead of moving to a seniors' facility, sometimes away from their own community. Government will provide $800,000 this year for the Department of Community Services to launch a pilot program that will provide funds to help caregivers look after ailing loved ones in their own homes. This could mean the difference between staying in the family home or moving to a care facility.

We also intend to improve accessibility and mobility for seniors who live in senior citizen housing units. We will install 13 new elevators in buildings across the province to improve the quality of life and mobility for many living in seniors' housing.

Mr. Speaker, providing assistance for those who have special needs or disabilities is a key role of government. And we recognize that adults with disabilities have different needs, based on their own individual circumstances. To help them, supports are provided to allow them to stay in their homes, to live independently or with the help of another family.

This year, we are providing an additional $2.2 million to Community Services to make their programs and services available to more individuals with disabilities. This funding will help improve client service delivery and better meet the needs of Nova Scotians with disabilities who depend on our support.

[Page 3625]

We will also embark on a new program to help families make their homes more accessible to wheelchairs. Nova Scotians will be able to make improvements to their homes to enhance accessibility for themselves or loved ones. Currently, applications for funding are made after an individual becomes disabled, which may be appropriate if the disability is a result of an unforeseeable accident or sudden illness. But the approach isn't ideal for a person who loses mobility as a result of a longstanding condition.

Mr. Speaker, this year we will change this program to allow eligible Nova Scotians who will require a wheelchair in the near future to get the help they need sooner to make their homes accessible. We will increase income limits by 30 per cent, from $30,000 to $39,000, to allow a greater number of Nova Scotians to take advantage of this assistance. The maximum amount of assistance is also increasing by 66 per cent, from $3,000 to $5,000, making more extensive work possible.

Mr. Speaker, this week we have made clear our commitment to our environment. At every opportunity, this government will make decisions that protect our environment and enhance our environmental practices. The Environmental Goals and Sustainable Prosperity Bill explicitly recognizes that the province's environmental assets are the foundation of its long-term prosperity. It has a broad goal of making Nova Scotia's environment the cleanest and most sustainable in the world by 2020 and commits the government to implementing Nova Scotia's growth strategy, Opportunities for Sustainable Development.

Specific measures relate to greenhouse gases, sulphur dioxide emissions, wastewater treatment facility discharges, targets for renewable energy sources, and protection of wetlands. It is among the most ambitious commitments to the environment in the country.

Mr. Speaker, the world has long recognized the energy potential in the Bay of Fundy. It is estimated that its massive tidal swells can provide about 300 megawatts of potential energy from just eight small sites, enough to power roughly 100,000 homes. We will proceed cautiously to ensure the safest, most innovative use of our amazing resource. A $250,000 strategic environmental assessment will help identify the potential impact of these devices on marine life, fisheries, and many other factors and also set the stage for choosing an appropriate test site.

Mr. Speaker, government is also investing $200,000 to start development of a water strategy that will address security and sustainability of Nova Scotia's valuable water supply.

Conserve Nova Scotia will have a $10.2 million budget to help Nova Scotians learn to reduce their energy use, both to save money and to help the environment. Programs will focus on residential, commercial, industrial, and transportation sectors.

Economic opportunities and our commitment to protecting our environment help to strengthen our communities and make Nova Scotia such a great place to live and raise a

[Page 3626]

family. But like everywhere, we have our share of social issues. Existence of a problem does not define a society; the true test is how society responds to the problem.

Here in Nova Scotia, we have learned from the Nunn Commission inquiry into the tragic death of Theresa McEvoy. As we announced earlier this year, the province has accepted all 34 recommendations of Justice Nunn, and this year we will invest more than $5 million to implement these recommendations. Three million dollars of this will focus on prevention and addressing the needs of families and youth in Nova Scotia. This includes hiring a senior official responsible for the development and initial implementation of a provincial child and youth strategy. These initiatives will help improve community safety by providing more supports for children, youth, and families. They will also help young people turn their lives around if they get in trouble with the law, and before they become repeat offenders.

Mr. Speaker, too many Nova Scotians, especially those in urban areas, do not feel safe on their own streets at night. It is a growing trend that cannot continue. As promised, this year, we will spend $7.5 million in the first year of a four-year program that will put 250 new police officers on our streets. But that's not all we are doing to help make Nova Scotia streets and communities safer. A new public safety investigation unit will have the power to investigate complaints related to prostitution, illegal liquor, drugs, or gaming. And, Mr. Speaker, we will continue the Rewards for Major Unsolved Crimes program, which encourages citizens to provide information that may help solve crimes.

Mr. Speaker, our society has made tremendous strides in the fight against drinking and driving, but there is more we can do to reduce the number of vehicle fatalities and injuries due to drunk driving. This year we will introduce the ignition interlock program in Nova Scotia, a program that disables a vehicle from being driven if the driver has been drinking. I am very happy to announce that this year we have earmarked $722,000 to implement the first year of the ignition interlock program, in an effort to reduce the number of drinking-related tragedies on our roads and highways.

Mr. Speaker, for all we have in common, Nova Scotians live in distinctive communities and come from a variety of diverse backgrounds. But wherever we come from and wherever we live, our sense of community is strong. We want to enhance this sense of community by, among other measures, investing in our arts and culture industry.

This year we will spend $410,000 more to nurture and support emerging arts and culture projects that have the potential to become export-ready products, to help existing and established artists find new markets, and to encourage new talent. In addition, we will invest an additional $1 million to help address critical infrastructure needs in the Nova Scotia Museum system and to further support community museums. (Applause)

Part of our commitment to our various and diverse communities has been to make sure that Acadians and all Nova Scotians have access to provincial government services in

[Page 3627]

both of Canada's official languages. In partnership with the federal government, this budget includes $688,000 to expand on the considerable progress that has been made in providing French-language services over the past year.

Mr. Speaker, one of my other Executive Council responsibilities is that of the Office of Aboriginal Affairs. Last month, on behalf of the province, I had the honour to sign the framework agreement for the made-in-Nova Scotia negotiation process with our First Nations. This year we will provide more financial resources to the Office of Aboriginal Affairs to support the continuation of this important work with the Mi'kmaq-Nova Scotia-Canada Tripartite Forum.

The Office of African Nova Scotian Affairs will continue its good work on behalf of African Nova Scotians. In particular, the Cape Breton satellite office is now fully staffed and will begin its first full year of serving the public in 2007-08.

[2:30 p.m.]

Mr. Speaker, we are entering the third year of our immigration strategy, and we will continue to promote and increase immigration to Nova Scotia. This year the budget for the Office of Immigration will increase to $3.728 million to support our immigration strategy.

We are very pleased with the progress. Between 2003 and 2006 the number of immigrants increased by 66 per cent, from just under 1,500 to just over 2,500. And, Mr. Speaker, this year we will partner with employers experiencing skills shortages to strategically focus our Nova Scotia Nominee Program recruitment efforts. To enhance those efforts, two new Nominee Program officers will be hired to assist in recruitment and help respond to the growing number of immigrants interested in living and working in our province.

Mr. Speaker, like every budget, this one is about choices. We have made the best choice for Nova Scotia. We will continue to fight for fair treatment of Nova Scotia and recognition of our Offshore Accord as inviolable.

In the meantime, this budget allows us to protect and enhance the programs and services Nova Scotians hold dearest and to continue reducing our debt without having to raise personal or business income taxes, and without cutting other programs.

It is a budget that allows us to advance the goals of the new Nova Scotia by laying a solid and sound fiscal plan for the year ahead. Thank you, Mr. Speaker.

MR. SPEAKER: Order, please. The honourable member for Halifax Fairview.

[Page 3628]

MR. GRAHAM STEELE: Thank you very much, Mr. Speaker. I am honoured to rise for the seventh time, as the Finance Critic for the Official Opposition, to reply to the budget - last year I had the chance to do it twice.

Mr. Speaker, I am sorry to have to begin my remarks the same way that I did last year, which is to acknowledge the personal health struggles of the Minister of Finance, and all we can do is offer you again our very best wishes and support to you and your family. In any other occupation this would be a very private matter, but because of the position you hold it becomes very public, and all we can do is wish you and your family our very, very best. (Standing Ovation)

Mr. Speaker, I also want to note, as the Minister of Finance did, another absent colleague, the member for Colchester-Musquodoboit Valley; the Minister of Agriculture. He is also engaged in a struggle to regain his personal health, and if he is watching on TV tonight we just want to let him know that we wish you all the best and we wish that you will return to the House at the very earliest possible opportunity. (Applause)

Mr. Speaker, let me say immediately that we, in the NDP caucus, have not decided - and we certainly will not say today - whether or not we intend to vote for or against the budget. We are acutely conscious of the fact that it is a minority government and to defeat the budget would involve a general election, less than a year after the last general election. We are acutely conscious of the fact that it seems virtually certain there will be a federal election within a matter of weeks, and so these decisions are not ones to be taken lightly. What we will do is, we will do our duty. Each member of our caucus will study the budget. Reflect on the budget. Talk to their constituents. Speak to the ministers during the Estimates debate and at the end of the process, not at the beginning of the process but at the end, we will make our decision for what we think is best for the people of Nova Scotia.

We, and Nova Scotians, are looking for some evidence of a direction that has so far been lacking from this government, since it was elected less than a year ago. After this budget, we are, I'm sorry to say, still waiting, for that sense of direction of what it is that this government wants to be and what it is the path that it holds out for the people of this province.

Now, Mr. Speaker, it would be an odd budget indeed if it did not contain a number of positive measures. It is not possible to run over a thousand government programs and spend $8 billion and not do some good things. So let me begin then by acknowledging some of the things that are in this budget that we like, that we support and that were part of our platform in the election held less than a year ago. We continue to be ready and willing to offer good ideas to the government and we are glad to see that they are picking up on at least some of them. (Applause)

We're pleased to see the volunteer firefighter tax credit, and the colorectal cancer screening program, although I'll have more to say about that later. The Nova Scotia Student

[Page 3629]

Bursary, tuition freeze and reduction; the Buy Local Program; the Agricultural Stabilization Funding; the Home Repair Program grant increase; caregiver support allowance; elevators in seniors homes; I know there's one, in particular, that the Leader of the Opposition has in mind - more police officers; the ignition interlock program; and the continuing roll out of more long-term care beds. All of those things formed part of the NDP platform in the last election. (Applause) We're very glad to see, indeed, that they form part of this year's budget. And let me make particular note, Mr. Speaker, of a major platform commitment of the New Democratic Party. Not just last year, but over the past several years, and that is, to remove the province portion of the HST, from home heating fuel. That program is fully funded in this year's budget, and that is, of course, a very good thing.

Mr. Speaker, we also note a number of measures, promised in the Progressive Conservative election program, on which the government is, today, failing to deliver. If this government wants the people of Nova Scotia to believe that is the fault of the federal government that is quite simply, nonsense. In this budget, there is $440 million of new revenue that they did not have at budget time last year. The ministers and the Premier's tour of the province, talking about the need to break their election promises, turns out to have been, simply an illusion. The money is there. The money was there. It seems that they were simply playing with the expectations of Nova Scotians. Wanting to dampen those expectations, so that they would not expect very much. There is $440 million of new spending in this budget, and only $79 million of that is due to the equalization issue that has attracted so much attention, since the federal budget was delivered on Monday.

Mr. Speaker, I want to make particular note of one Progressive Conservative campaign promise that is not being kept in this budget, and that is what the Progressive Conservatives call, the Working Families Pharmacare Program. That is - any member of this Legislature knows- that is a great need in this province. Although it may not have a high public profile. Any of us who have constituency offices, in other words, all of us, know about the heart-rending situations that people find themselves in when they are unable to afford necessary medication for themselves and their family. In the last election, the Progressive Conservatives promised that they would do something about that. As many of the Progressive Conservative promises were, it was a multi-year program, so people weren't actually going to see the benefit for a number of years, but in the first year, namely this year, they forecast the cost at $25 million to start the program.

In this budget today, Mr. Speaker, the government allocates to that program $5 million, and this is what the people of Nova Scotia won't read in any of the budget documents, that is entirely for development work. During this fiscal year, not one single Nova Scotia working family will have their medication paid for under this program. The $5 million is to pay for computer programming and other similar development work so that the program might be put in place sometime in the future.

There is no working families Pharmacare Program in this year's budget, Mr. Speaker, and I think it is very important to point that out. It was a major part of the Progressive

[Page 3630]

Conservative election platform last year, and it has disappeared from the budget. It simply is not the fault of the federal government. The Premier announced that he was going to have to break some of his election promises before the federal budget was delivered. So it would seem odd for him now to blame the federal budget as the reason why he has to break those promises.

Oh, I know, Mr. Speaker, the Premier says he's not breaking his promises, he's simply deferring them. Meaning that he's not going to do them when he promised he would do them, simply at some future time. I think it's very clear to Nova Scotians what it means to have a deferred election promise. No doubt it will pop up again just in time for the next election.

Mr. Speaker, let me turn then to the issue that is attracting so much attention this week, and that is equalization and the Atlantic Accord. What is clear now, and must be clear to every member of this House is that we have a federal Conservative Government that is not sympathetic to the history and aspirations of Atlantic Canada. The choice given to Nova Scotia in Monday's budget turns out to have really been no choice at all. In figures supplied by the Department of Finance today as part of the budget background, it shows that the difference between the two options presented to Nova Scotia is $921.3 million over five years - $921 million dollars of difference between the two options. So needless to say, the Government of Nova Scotia has chosen the option that provides more money rather than less, but let's make no mistake about it - this option means the end of the Atlantic Accord, and that is precisely what the Prime Minister and the federal Finance Minister want.

Now, on Monday night, our Premier said it was the fault of nameless bureaucrats in Ottawa who never liked the accord. That's not true. No one could have listened to the Finance Minister this week and believed that somehow he had been hoodwinked, that somehow he was the prisoner of bureaucrats who forced him to do something he wouldn't want to do. Stephen Harper and Jim Flaherty are nobody's prisoners. They are prisoner only of an ideology that is not sympathetic to our aspirations, Mr. Speaker. (Applause)

The federal Finance Minister says they want to have their cake and eat it too. Yesterday, he said to the New Brunswick Finance Minister, who raised the possibility of having a similar accord for New Brunswick, it was "not a chance". The federal Finance Minister says he does not believe that these natural resources accords are good for Canada. So no one should be under any illusion about where this decision came from. It did not come from bureaucrats - it came from the Prime Minister, the Finance Minister, and the federal Conservative Party.

[2:45 p.m.]

The error that our government made, Mr. Speaker, when dealing with the Atlantic Accord, is treating federal-provincial relations as an event rather than as a process. What they left out of the equation was that over time the players change and although we reached

[Page 3631]

the Atlantic Accord, very influential people were not convinced by it, among them the premiers of a number of the other provinces who didn't like it, never liked it, still don't like it and kept working to eliminate it. Also, Mr. Speaker, unconvinced by it all was Stephen Harper. When he has had a chance to follow through on his own promises, he has broken that promise as well.

Mr. Speaker, those of us who oppose Conservatives federally and provincially know that if there is one thing Conservatives are good at, it is the spin machine. It is making things appear - putting appearances above reality. Many people have been on the receiving end of the Harris government's spin machine, of which Jim Flaherty was such an integral part. You know what the most uncomfortable thing of all must be for Nova Scotia Progressive Conservatives? Now we - we all, here in this House and in this province - are on the receiving end of the federal Conservatives' spin machine. Because their message - not to us - their message to the rest of Canada is that they are respecting the Atlantic Accord; they are leaving it entirely in place. They are not touching one comma of the Atlantic Accord.

What they don't say, of course, Mr. Speaker, is that they are so changing the rules and the context in which that accord operates, that for all practical purposes it had been torn up and left on the floor.

I have heard Prime Minister Harper deliver that message, I have heard the federal Finance Minister deliver that message and I have heard Nova Scotia's Conservative Members of Parliament deliver that message. Their message to us, and to the rest of the country, is that we are trying to have our cake and eat it too. There is not a chance that any of this is going to change.

What is going to happen now? Now the federal government will dangle money in front of the Nova Scotia Government dealing with the Atlantic Accord saying look, there's some money for gateways - not for your gateway, but there is some money in the budget potentially for gateways. Now you had better be good or you are not going to get any of it. That's the message now in the future. Now that they've destroyed the Atlantic Accord, they are going to try and keep us quiet and say, if you don't behave you're not going to get any money for the Atlantic Gateway.

Our province wants $400 million and the federal government has allocated a little over $1 billion. Do you think we are going to get $400 million of a total amount of money of $1 billion, without fighting tooth and nail for it, fighting the Port of Montreal? British Columbia and Vancouver want to establish a Pacific Gateway. Mr. Speaker, that's what they'll dangle in front of us now that they've destroyed the Atlantic Accord, is money for the Atlantic Gateway.

Mr. Speaker, there is one thing that the provincial government has to take from all this and that is that the old approach is not working. The old approach to federal-provincial fiscal relations is not working because the Atlantic Accord was the result of a happy

[Page 3632]

coincidence of circumstances where we had two Atlantic Premiers who wanted a deal, a federal Liberal Government that wanted to deliver the deal, elections looming, and so they entered into the Accord. What they didn't take into account was that that federal Prime Minister would leave the scene very shortly thereafter and the government taking the place of the Liberal Government was considerably less sympathetic to the goals of the Atlantic Accord.

What we are saying to the Premier is, you must take a position in favour of Nova Scotia and take it to its logical conclusion, which is what the Premier of Newfoundland and Labrador has done.

Mr. Speaker, if a Conservative majority government is elected in Ottawa in the next federal election, which could be only weeks away, the Atlantic Accord is dead and gone forever. Neither the Prime Minister, nor the federal Finance Minister, nor Nova Scotia's Conservative Members of Parliament have any interest in undoing what they have just done. The words of the federal Finance Minister, "Not a chance." He says the door is closed. It's over, it's done, he is not going to discuss this issue anymore.

So we ask the Premier to have the courage to say to Stephen Harper that he is not welcome in this province in the next federal election. We ask him to help to defeat those Nova Scotia Conservative Members of Parliament; Conservative candidates who will make sure that if they go to Ottawa, that the deal stays dead. We ask him not to stand on a stage with Stephen Harper and ask Nova Scotia voters to vote for a government that would do that.

Danny Williams says he's going to do that. Why can't our government do that? After the federal Conservatives ripped up the accord, what did our Premier say? He was going to call them - he was going to call them, he had a conference call with the Members of Parliament. Apparently it didn't have any effect because, the very same day, Nova Scotian Members of Parliament said they delivered the line from the briefing notes, which is the Atlantic Accord is being entirely respected. That's the only thing we're going to hear from them. It is time that Nova Scotians sent a message to federal Conservative candidates that this is wrong, it must stop, we must defeat them. If the Premier isn't willing to say that, then I guess we know where he really stands.

We will work with this government on a new approach to federal/provincial relations. Federal/provincial fiscal relations affect us all in Nova Scotia. It is not something where one Party should be saying we'll do it alone, we'll talk to our friends, we'll get on the phone. It is not working; it is clearly not working. When the federal government could do such a thing to us, to rip up the Atlantic Accord and then to have our representatives in Ottawa, instead of taking our message to Ottawa, they're delivering Ottawa's message back to us, which is, "Not a chance."

We are ready to work with this government, but they must stop trying to do it on their own. They must stop this process of trying to do things behind the scenes, talking to their

[Page 3633]

supposed friends in Ottawa, saying that's how they will get more done. They've tried that and it is not working - it is not working.

We are glad to see that the provincial government here has not followed the lead of the Liberals in New Brunswick. I think it came as a shock to most of us last week when they delivered their budget with higher taxes, less spending on roads, and a really serious exploration of privatized health care.

I think perhaps the Liberals here in Nova Scotia need to have a word with them over there in New Brunswick. What I am afraid of is that the Liberals in Nova Scotia have the same sort of agenda. When their colleagues next door had a chance, what did they do? They raised taxes, cut spending on roads and started down the road of privatized health care.

But let no one say that this budget does not contain any tax increases, because it does - it very clearly does. There is an across-the-board increase in user fees - every single fee charged by government is going to go up 6.8 per cent, effective immediately. That is probably the thing that the ordinary Nova Scotian in Tim Hortons tomorrow is going to notice about this budget, that every single thing that they ask for from their provincial government is going to cost more starting tomorrow. I'll tell you something else they will notice - civil servants in Nova Scotia will immediately see a cut in their take-home pay because of the increase in their pension contribution.

Now, we know that pensions need to be properly funded, but what are people actually going to notice out of this budget? This budget contains no big ideas, no vision, no particular direction. It is what I can only describe as a grey budget - colourless - taking $440 million of new revenue and spreading a little bit around everywhere. A little bit for everything, a lot for nothing.

What will Nova Scotians notice tomorrow? The next civil service paycheque will be cut; the next time a Nova Scotian goes to seek a service from their government, it will cost them more. As we have said so many times before, on this side of the House, user fees are the most regressive form of revenue raising the government can pursue, because the fee is the same for everybody. If you have to pay the same fee for a driver's licence on an income of $8,000 or $10,000 or $12,000 or $15,000 it's going to hurt you a lot more than the exact same fee charged to somebody earning $100,000. It hits poor Nova Scotians hardest and today the government is raising tens of millions of new dollars in user fees.

That brings me to what the Leader of the Opposition has referred to as the "ticking time bomb" in this budget and that is lack of health care spending. The Minister of Finance's words in the budget were interesting - I'll see if I can find them because the words are very interesting. He says: "In this budget we have to balance not only the needs within the health system but also the competing and equally important needs of all government services so this year we have limited the increase in health care spending to 5.3 per cent." Now, Mr. Speaker, of all the reasons to offer for limiting health care spending, that strikes

[Page 3634]

me as a peculiar one. They're not doing it because it fits within the program delivery model, it's not because they think that's enough - it's because other departments need more. As everybody knows, the Department of Health is a voracious dragon that chews up an ever-increasing percentage of the provincial budget.

What that sounds like very much is that the government has simply taken a number out of the air and said, Department of Health, whatever it is you need we're going to give you a number that's based on what other departments need. In case anyone in the House thinks that I'm crying wolf over this or that I'm exaggerating by calling it a ticking time bomb let me quote from the President of Doctors Nova Scotia who said a very short time ago that the increase in health care funding means "this is not a health care budget. It means that we are going to fall further behind in health care. There are no new programs and what we can expect to see among other things as a result of this budget is longer waiting lists." Mr. Speaker, that is not me talking, that is the President of Doctors Nova Scotia who perhaps knows a thing or two about the real impact of a budget like this on the health care sector.

As a result of this arbitrary limitation on funding of the Department of Health, we can expect to see longer waiting lists. We will not see any improvement in emergency room wait times and we will not see any improvement in emergency room closures. This kind of increase means that the government can't even maintain the status quo. We all know that this is the number-one issue in the minds of Nova Scotians - it tends to dominate this Legislature, it tends to dominate Question Period. Things are not only not going to get better as a result of this budget, they are going to get worse.

Mr. Speaker, we all know that the rate of increase in health care spending cannot continue to go up. The health care budget cannot continue to grow by eight per cent every year without something giving. What we need, what we're looking for is a plan, we're looking for direction, a vision - especially from a Party and a government that came into office in the 1999 election largely because of their criticism of the Liberal Government's failure to have a vision for health care.

[3:00 p.m.]

After reading this budget we are none the wiser about how the government is going to rein in health care costs; we are none the wiser about what the future holds; we are none the wiser about how the government is going to deliver the services that Nova Scotians need in the health care system. Mr. Speaker, I talked earlier about the Pharmacare Program that is not being delivered this year. Well, let me mention another one that I heard one of the ministers on the other side mention - the colorectal screening program. That's a good thing but the government is not implementing a colorectal screening program this year. They are implementing the development work. It's going to be consultants and equipment that get this year's money. Not one more person is going to be screened for colorectal cancer this year as a result of this budget, just like not one single Nova Scotia family is going to get

[Page 3635]

Pharmacare coverage this year but that is not the impression that the government wants to leave with Nova Scotians.

Those of us who have been in the House for any length of time, Mr. Speaker, are aware of the painful and persistent gap between what the government wants people to believe is happening and what is actually happening. We have to find ways of closing that gap, and eliminating that gap in the Pharmacare Program and the colorectal screening program are only a couple of examples where the government claims to be doing one thing, but is not doing that thing or is doing it in such a small way that for all practical purposes, they are really doing nothing.

This is, at the end of the day, the budget of a government that is still trying to figure out what it is all about. It is still directionless. What we see are slogans instead of substance and the government rolled out a whole new slogan yesterday, which was repeated in today's budget, Mr. Speaker. We will see how long they go with it until they abandon it for another slogan. We don't want slogans. We want substance. When will this government learn that the most powerful, persuasive, long-lasting, attractive political tool ever invented is the truth? To tell Nova Scotians the truth about what is happening, to say sorry we can't deliver the Pharmacare Program this year, instead of claiming they are but it turns out it's really just for computer work. We need a government that drops the slogans in favour of substance. We need a government that shows its firm commitments instead of ever-shifting enthusiasms.

On this side of the House, in this Party, our commitment is clear. We are for a better deal for today's family. We have shown that, Mr. Speaker. We will work with the government as long as they show us, as long as they show Nova Scotians that they are headed in that direction or even show that they might be headed in that direction or give us hope that they may be headed in that direction. That is the standard by which we will judge this government, that is the standard by which we will judge this budget. If the government is not prepared to do that, if the government is not prepared to show that they understand what it means to deliver a better deal for today's families, then all we can do is take it to the people of Nova Scotia and let them decide. Thank you. (Applause)

MR. SPEAKER: The honourable member for Halifax Clayton Park.

MS. DIANA WHALEN: Mr. Speaker, it is a pleasure to rise today to speak to the budget and reply to the budget this year. On behalf of my caucus, I would also like to send our best wishes to the Minister of Finance. I know he has certainly worked very hard to bring in this budget under difficult personal and difficult political situations. So I would like to extend our support to him, personally. (Applause)

Like all members of the House, I know that it is in our best interest to look to the concerns of Nova Scotians and to represent them here as we deliberate a budget that has an impact on the people of Nova Scotia. So our concern, as members of the Liberal caucus, is that we look at this budget with care and consider the details so that we can see that there is

[Page 3636]

benefit for our constituents and for the people who make Nova Scotia their home, which is so important.

This budget does include a great deal of increased spending - we are talking about a $440 million increase in revenue. That is a little bit unusual in our province and perhaps more unusual in light of the cautions we were receiving from the government side of the House in the lead up to this budget. I guess we should be prepared to know that sometimes they pull a rabbit out of the hat or mislead us along the way.

However, we are glad to see that you were still able, in this budget, to meet certain priorities that the Liberal caucus has and priorities of the people of Nova Scotia. The budget includes a large increase again for health care and we're looking once again at 7 per cent. Over the last few years that I've been here and been the Finance Critic we've seen even double-digit increases in health care spending, and this year it is approaching $3 billion. I feel that it is important, as members of the House, to caution the government about the increases in spending, because there must be a better way to approach this particular department.

We know that this government in 1999 felt they could solve the whole problem for less than $100 million and rode that wave to victory in 1999 saying they had a plan, but we have yet to see your plan in health care. We would like to know why it is at $1.5 billion. It has continued to rise - as I say, this is a bottomless pit and all of us are concerned about people who need help and there are ways and programs that are needed, but the concern is that this will swamp and overtake all other government spending. In fact, the previous Premier had said so - by the year 2020 we would have overtaken all other department spending. So this again, seeing a 7 per cent increase and no plan on how we're going to curtail that, is a concern to the Liberal caucus.

At the same time we see an increase in post-secondary education over 10 per cent, just barely over 10 per cent. I think all members of this House, and certainly our caucus, agree that post-secondary education, investing in our students, in our apprenticeship, in our skills training in the community college is extremely important for our future. That's one area of expenditure where I know that we see a benefit and it addresses some of our key concerns in terms of demographics and the trends in our province. We need to help our young people stay here to study, get the skills they need and find employment in our province if we are to continue to grow and sustain.

I think those major trends are a bit of a concern on the health side - we are interested in greater spending on education and we know that we need to give more support to our students. So in framing that, Mr. Speaker, I believe that the issue that has been underlying the budget this year, and as we know causing a great deal of uncertainty, has been the battle around equalization and exactly how the equalization formula was going to work and help us here in this province. We've seen really that the federal government has sold us out and has backed away from their promises and their commitments - and I mention specifically

[Page 3637]

their election commitments in January, a year ago, when they promised to abide by the accord that was in place and they promised they would respect it.

Mr. Speaker, we have seen that they have turned their backs on Nova Scotia and, in fact, turned their backs on our government here. This has had a profound effect both in planning and executing this year's budget and in making a decision that is going to have a tremendous effect on our future. It really is a question of us having to gamble on the future of our Offshore Accord.

MR. SPEAKER: Order, please. The honourable member for Halifax Clayton Park has the floor.

MS. WHALEN; Thank you very much, Mr. Speaker. I am speaking about the Offshore Accord and the gamble that the government has been forced into taking.

Today we were able to see the projected revenues that would come under both scenarios - the government having been given a choice between keeping the old equalization, or older formula, and being able to maintain our Offshore Accord or switching to this new program that has been proposed by the federal government. By doing so, by choosing the new approach which is, I guess, determined by an O'Brien report, it means that we actually get a lot more money this year and in future years. That has to be measured very carefully, Mr. Speaker, against the model where, if we hold fast to our commitment to the accord, we certainly won't be in as good a position over time. In fact, the five-year projection, which I was just seeking out here is almost $1 billion difference. We're looking at $921 million difference in a five-year period of time.

When you compare the two, it shows that the government scarcely had a choice in terms of what to do because, Mr. Speaker, Nova Scotia is not a province that has the fiscal capacity to manage that kind of a hit financially. We have a population of less than one million people, but we are spread around many communities and we have a need for services. We know that we are a province whose roads are in desperate shape and in some areas worse than desperate. We're a province that has a need to provide health care and education to our rural and smaller communities as well as in our capital. So these create fiscal pressures that have to be addressed and for a small province like Nova Scotia to forego almost $1 billion in extra revenue over just five years, is simply too much for us to absorb.

So I feel that the federal government has abandoned Nova Scotia and has also put us in a very untenable situation. The success, and I think if we just call it the success, that former Premier Hamm had in negotiating that accord, was also a success, I believe, for the federal Liberal Party that supported it and came to the aid of Nova Scotia. To see that just torn up and thrown aside, you know, I certainly feel that it is wrong, that we've been misled, and the government has lied to us in their attempt to win seats in this province. I do call upon the government to (Interruption) I can't say lied, misled.

[Page 3638]

MR. SPEAKER: Order, please. I would ask the honourable member for Halifax Clayton Park just to withdraw that word and continue with her address.

MS. WHALEN: I withdraw that word. I would like to say that we were misled. All of us were misled in the election aspirations of the federal Conservatives and I do believe that our sitting Conservative federal members should speak up and speak up loudly and all Atlantic members should be singing from one song sheet. In fact, our caucus has offered the Premier that we would like to join in an all-Party committee to raise this issue with the federal government because I believe when we join our voices together, one voice is stronger than three Parties speaking separately. I'm sure that the Official Opposition would want to be part of that because we all have a great deal at stake in this situation of being asked to forego what could be our opportunity through the accord to become a province that can benefit directly from our offshore and the revenues that are coming in and not to be held hostage, to be penalized, because we have an industry that's expanding, or that we hope will expand.

We know there's a lot of uncertainty around that and that's what makes the decision so difficult. If we were able to predict precisely what the value is of our offshore, that would be one thing but, as you know, there's a great deal of uncertainty. It makes it a tremendous gamble for our province, Mr. Speaker, and that concerns us greatly.

Mr. Speaker, one of the issues that is always hanging over the head of our province is our tremendous debt. We carry a debt of $12.4 billion and we should not forget- I should mention in the Budget Address it was mentioned that the debt was accumulated through the 1980s and maybe the early 1990s, but it was not mentioned that half of our tremendous $12.4 billion debt was accumulated during the years that John Buchanan was our Premier and I think it has to be repeated, because that was a time of (Interruptions)

MR. SPEAKER: Order, please. Order, please. The House has accorded courtesy to all speakers here this afternoon.

The honourable member for Halifax Clayton Park has the floor.

MS. WHALEN: Well, Mr. Speaker, that is just part of the history lesson. It's part of the record. We know the spending was out of control and reckless for many years during that particular administration and I think it's worthwhile noting that we must never go there again, that the fact that this year's budget is balanced and has been for a couple of years, a number of years, that's a good thing. That's something that the Liberal caucus and Liberal Party believe must be the way to go. We know that there's a great danger in carrying a debt that's so high.

[3:15 p.m.]

[Page 3639]

Mr. Speaker, we have been very fortunate to be in a period of time when the interest rates are at historically low levels. That has been, you know, a mechanism and a means for the government to manage the debt and to bring down the amount of our debt servicing costs. We're going in the right direction with that, having brought it down to 12.1 per cent of our provincial expenditures, but bearing in mind that this is still over $800 million a year going out in debt-servicing costs. That would pay for a lot of daycare spaces. It would help women's centres. It would help alleviate poverty in this province, and there are so many things we have, in terms of social needs that are pressing in our province and they're not being addressed partly because we're carrying this onerous and difficult debt.

This year, the Premier has indicated his concern for the debt. It's the first time we've heard him speak about that, and we're hoping that his commitment is sincere and will be realized in future budgets and a continued effort to bring our debt under control, because it does require more than a balanced budget, it requires a plan and sticking with that debt-reduction plan. Mr. Speaker, we would like to see that plan certainly strengthened, if at all possible because the debt, as I say, has prevented us from really helping people who need it the most.

What has helped us in this province, as well, has been an increase in our own source revenues, Mr. Speaker. And the government has enjoyed really seven years of growth in our economy, which has been very fortunate and allowed them to introduce some programs and some spending, which was not possible in 1999. The 1999 Budget that was defeated and triggered an election, was about a $5 billion budget, and this year in program spending and debt servicing, we see the budget well over $7 billion. So that's a tremendous increase in spending power and capability for the province. A lot of it has come from our own source revenues. The percentage that we're receiving now from equalization is less than it was in 1999, on a percentage basis. Still very significant on a dollar basis, as we have said. But it is going down because our own economy has grown. Our level of employment has grown. Our own businesses are expanding and therefore we're in a stronger position to fund some of things that we need.

One of the most significant increases this year, is in the offshore royalties. In just three years, the income we've received from the offshore industry and from our royalties has gone from $128 million to $280 million, to $420 million, and that is a tremendous increase and a very significant proportion of our budget. That has, in fact, saved us this year and allowed us to help to spend for students and to spend on important programs where the demand has been significant. But my concern with the offshore royalty is, again, as I said earlier, we can't predict how long it will last, where it's going, what reserves we have and how long we can enjoy this kind of an increase.

Mr. Speaker, even if the amount were sustainable, even if it just remained stable from year to year, that would be wonderful, but we know it's going peak and it's going to begin to decline at some point in time, and that is a concern to us. We're watching with great interest as the Deep Panuke Project comes forward. Cautiously optimistic because, again,

[Page 3640]

we're not sure how this is going to be and we're concerned about not being misled that there's more there or that it will be longer lasting then perhaps it will.

In terms of the Sable project, we are three or four years behind what was expected initially. So we have to be cautious in trying to measure and anticipate where that industry is going to be in a few years.

In terms of the offshore industry, Mr. Speaker, I believe that it's important that we invest more in human resources and support for the industry in the regulatory side, so that there will be an interest among the industry to come here and explore. In just the last couple of years, we've seen exploration licences being expired and we've actually gained some financial benefit, which is not where we want to gain financial benefit, from seeing an industry that's cashing in and not bothering to go forward with exploration. So, I do urge the government to look carefully about how we can create the right environment to continue that level of exploration and interest in the offshore.

MR. SPEAKER: Order, please. I would just ask the members to mind the noise level in the Chamber.

MS. WHALEN: Mr. Speaker, there are two significant priorities really in Nova Scotia, or challenges in Nova Scotia. One of them is our labour growth and the other is our declining population and wherever you travel in the province and I know the members can attest to this from their own communities, this is a major concern for the people living in big and small communities in Nova Scotia. Overall, our population has declined in 14 of the 18 census areas in Nova Scotia, and some of those declines have been significant, in the double digits; I believe Guysborough was 17 per cent decrease in population.

Rural Nova Scotia is particularly hard hit. In this budget, we see several things that I believe will help in rural Nova Scotia in terms of population. One of them is the expansion of the Student Employment Program, which is an initiative the Liberal Government (Interruption) Liberal caucus has been calling for - soon to be Liberal Government - for a long time. (Applause)

The student employment program allows young people to return to their own homes and have jobs in the summertime. Without that, there are many, many non-profit groups and smaller employers that don't have access to students because they don't have the help to hire them in the summer months. So having an additional 225 jobs created for young people is very significant and will make a big difference in our small areas and in our tourist industries, our little museums and tourist businesses. So, I applaud the idea that we have expanded the Student Employment Program.

Along the same vein is the introduction of the Winter Works Program. I should say it's a reintroduction, Mr. Speaker, because that was a Liberal program that was axed a number of years ago by the Progressive Conservatives, but, again, you have seen that it is

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an important program. I know the government is listening to the people of Nova Scotia in all communities and sees the need to help supplement so many of our people who live on seasonal income, and seasonal work. Providing a winter works program allows them, again, to stay in their own communities rather than leaving to find work during a part of year when their seasonal jobs are not available. So this is another very important program which is going to provide, I believe, in the range of 300 jobs in the winter months, particularly to help rural Nova Scotia.

Those two programs, together, are very important. Another one that I believe will make a big difference, is the expansion of the payroll rebate program. This program will have a bigger impact in rural Nova Scotia, again, where the jobs are more scarce. What we're seeing in this program is, now you will be eligible for a payroll rebate if you create 25 new jobs, rather than the former threshold of 50 new jobs.

I know the demand has been there, and smaller employers - and I still consider 25 new jobs a pretty big employer, but, nevertheless, it's making this program open and available to more businesses in Nova Scotia. So, for that, we are very pleased to see that go forward, and I hope it will have a direct and immediate impact on some businesses.

Mr. Speaker, in the health care area, particularly for seniors, there are a couple of things that I think are good news and worth noting. One of them is the pilot program introduced for in-home support, which will help care givers looking after their own loved ones in their own home. We've seen time and time again where people have come to us because the stresses are so great to care for your own loved ones where they should be, with their families. Often the stress becomes too great financially or because of the cost of renovating or adapting homes, there are so many financial stresses on the family that often the only option is a nursing home or looking for long-term care. At present, we have 1,600 people waiting for a long-term care bed, so that option is not immediately available for families that are under stress either. So turning the government's attention towards the need for support for home care and caregivers, family care givers, is a very big plus in my opinion, and in the opinion of this caucus.

We also applaud the idea of putting more funds into the department of seniors. Last year, the budget did no more than create the department in name and reassign a secretariat - the Seniors' Secretariat - to that. You did name a minister for seniors and we were pleased with that, but it was just the very first small steps. This year, it is good to see some funds being put in there, additional funds, of $800,000, which brings the department of seniors up to a $2 million level of spending. That's a positive step for this province.

Mr. Speaker, as you know, we have 160,000 seniors living in Nova Scotia and they require a voice and they also require, I think, very concerted-focus programs that will help government respond to their needs and create a better environment for our seniors as they age. As you know, the initiative these days is to help people age in place, in other words age

[Page 3642]

where they live, in their communities, still contributing and maintaining their social and other networks that are in place after years of living in a community.

I also applaud the addition of the target for accessible buildings, that we will have our public buildings moving towards full accessibility by the year 2020. I think the government is wise in choosing a date and locking into that and making a firm commitment to the people of Nova Scotia who have been asking. I know the group The League for Equal Opportunities and others have been asking that we respond to the needs of the disabled and I believe that in the Budget Address it was mentioned that we have a high proportion of people who receive disability in this province.

Mr. Speaker, I think there are a number of very positive things we've referred to.

I wanted to go to the subject of gas regulation, Mr. Speaker, because that is an area where we have differed with the government and we differ strongly with the Official Opposition as well. Gas regulation mean higher prices in Nova Scotia for consumers. Whenever we go to the pumps and fill up, we're paying 11 cents more right now than our neighbours in New Brunswick and today might have been a day when there is an adjustment but there was no adjustment, we're still paying the same amount as we did last week.

Regulation was looked at in a study that the government had requested. It cost over $170,000 for that study, and the study recommended that we not go to gas regulation. As a pre-election move, I guess, the government of the day, our government that is here today, in fact adopted this move with encouragement from the Official Opposition, and that has cost Nova Scotian consumers. That also costs our businesses because every business that has to transport goods or move items or people, has to pay more and that hurts all of us.

We believe the regulated system is flawed, we believe that the first six months of its operation has shown that it was the wrong move to make and that we should not be having this kind of a price difference between us and our neighbouring Province of New Brunswick, regardless of the tax differences because we know that taxes are lower in New Brunswick, but even at that, the 11 cents far outstrips the tax difference. We look to see the answers soon, I guess, with the review which is underway on gas price regulation.

We hope to see greater moves on conservation. I note that more money has been put into Conserve Nova Scotia but we want to see some programs in place that are going to have immediate effects on helping Nova Scotians change their behaviour. I will mention only briefly that there is the opportunity to pass a bill on credits for transit users on their bus passes and for fuel-efficient vehicle purchases. Three other provinces have already moved to provide tax incentives for consumers to purchase fuel-efficient vehicles - that would be Ontario, Manitoba and our neighbour, Prince Edward Island. The federal government has made a move in that direction in their recent budget so maybe the time is right for this province to look at that as a way of showing that we're serious about changing our habits and our consumption of energy.

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Mr. Speaker, I wanted to touch on students a little bit before I close because the student lobby has been very loud and strong and have presented their case very well to all members of this House. Student leaders have pointed out that not only do we have the highest tuition in the country by $2,000, but we also have been awarded the dubious distinction of being the least affordable jurisdiction in which to study. We were rated, I believe, 60th out of 60 jurisdictions, including the United States as well as Canadian Provinces, and that included the cost of living as well as the cost of studying in those jurisdictions. So the need to address and respond to our students in this province is acute.

As I mentioned earlier, the education system is very important to us, trying to attract and maintain a student body here in the province is a key for us for our future growth. Many of the students who choose to move here from other provinces to study will choose to stay because they like it here, they enjoy our lifestyle, they enjoy our province. We need to attract them here in the first place and we're hitting a point where we are absolutely uncompetitive with our neighbours across the country, not only our immediate neighbours but right across the country.

[3:30 p.m.]

So it is important to do more to help them. I note that for our own students we have lowered tuition by about $500 in the coming year. I hope that that program is sustainable, Mr. Speaker, because we know that there was a two-year program, which was federal government monies that were diverted here from last year's surplus and that was only to go for two years and the $440 tuition relief was given this year to students in Nova Scotia. I assume this $500 is added to that, but I am concerned about the future of that program and hoping that it is sustainable so that we will be able to find ourselves at a level that is at least on the national average within a couple of years. I think that we have to get there as soon as possible.

The tax incentive for students who graduate and choose to stay and work in Nova Scotia is something that was included in the Liberal platform in the last election, not one year ago. We proposed it over a number of years, but we are happy to see the government increase it from a one-time amount of $1,000 to now a $2,000 benefit for students who will stay and work here in Nova Scotia. I note that that is not a tax credit, it's actually a tax incentive which would come right off the bottom line of the taxes paid. So we do appreciate that and believe that is the right thing to do - and perhaps could increase it as well.

Mr. Speaker, there are a number of Liberal initiatives in this budget which we do appreciate and are glad to see, we believe they make sense. One of them was the firefighters credit, offering up to a $500 credit for volunteer firefighters. I know it is going to be phased in over a few years, or a number of years. We also see user fees being changed so that they will now come and be reported before the House. We introduced a Private Member's Bill to that effect earlier this year and believe that that is the right way to shine the spotlight and have proper accountability on the user fees.

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The change in the primary age for starting school, moving it from October 1st toward December 31st and making us more competitive, is also a move that we believe is the right thing to do and have introduced measures to that effect.

We support the idea of helping and providing direct support to the pork producers in Nova Scotia, because that industry has been under tremendous stress and requires assistance so that the people engaged in that industry can make the move toward a more sustainable production of pork.

Mr. Speaker, just on the taxes, I wanted to mention two things. I believe that we need to move again - we are moving by baby steps with the $250 a year on the basic personal exemption limit, but we are still way out of line with the rest of the country in terms of where we stand. Nova Scotia will move up a little bit to about $7,500 or so, but Alberta offers $14,000 and the next closest is Quebec at $9,000, so I would like to see us move up because that is money most beneficial to our working poor, people who are on the bottom line of that. So those are important measures. I know that the Canadian Federation of Business was looking for a move to stop the bracket creep or the indexation of our brackets, that they are, at present, not connected to the federal brackets and we would like to see that as well.

Mr. Speaker, we urge the government to work with all Parties on the issue of equalization and the fight to see our offshore accord respected in the federal government. We urge you to look at an all-Party approach to that because we believe that together our voices will be stronger. I thank my colleagues for your attention today, and with that I will adjourn the debate. (Applause)

MR. SPEAKER: The estimates are referred to the Committee of the Whole House on Supply.

The honourable Government House Leader.

HON. MICHAEL BAKER: Mr. Speaker, I move that the House now adjourn, to meet on Monday at the hour of 2:00 p.m. The House hours will be from 2:00 p.m to 10:00 p.m on Monday. The order of business, after the daily routine, would be Committee of the Whole House on Supply and Public Bills for Second Reading.

MR. SPEAKER: The motion is for the House to now rise and meet Monday at the hour of 2:00 p.m. to 10:00 p.m.

Would all those in favour of the motion please say Aye. Contrary minded, Nay.

The motion is carried.

[The House rose at 3:35 p.m.]

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By: Mr. Michel Samson (Richmond)

I hereby give notice that on a future day I shall move the adoption of the following resolution:

Whereas tonight is the 2nd Annual Kings North Liberal Association Appreciation Night; and

Whereas Leta Ells, Glenn Ells, Marion Newcombe and John Newcombe are being honoured for their many years of exemplary service and dedication to the democratic process in Nova Scotia; and

Whereas each honouree has their own reason for giving their time and talents, they all share the same desire to build a better Nova Scotia for our children and grandchildren;

Therefore be it resolved that the members of the House of Assembly congratulate Leta, Glenn, Marion and John and recognize them for their contribution to the Liberal Party and Nova Scotia.