Province		 Législature Session	Type de discours	Date du discours Locuteur     Fonction du locuteur  Parti politique
Terre- Neuve et Labrador 40e	     4e  	Discours du budget	29 mars 1988	 Neil Windsor Ministre des finances PC

Mr. Speaker. I also want to recognize the important role that the President of Treasury Board 
and his staff have play I'd in this preparation of this Budget document. As the former 
President, I know full well the very long and difficult task the Board and staff have to face in 
preparing the estimates of expenditure for the corning year and I applaud them for the highly 
professional job they have done again this year.

It is indeed a pleasure for me to present to this Honourable House today my first Budget the 
tenth of the Peckford Administration: I wou1d like first of all to acknowledge the contribution 
of my predecessor, the Honourable Dr. John Collins, over the years 1979 to 1987 inclusive. 
His was not always an enviable task, particularly through the early 1980s when the economy 
of our Province was devastated by the national recession which struck this Province with 
greater force and was of longer duration than in the rest of the country.

Deficits on Current Account first, became a recurring problem during the recessionary period. 
It is largely through his liaise and tireless stewardship of our financial affairs that our 
Province has maintained the degree of fiscal integrity that we enjoy

Mr. Speaker contrary to reports which have appeared in the media in recent days, this Budget 
will not be revealing an increased deficit over that projected by last year's Budget or the mid-
year report. Some members of the media have interpreted the Special Warrants which were 
tabled recently in the House as an indication of a burgeoning Current Account deficit. I am 
glad to report that, in fact, the reverse of the media reports is true in that the financial position 
for 1987-88 has improved considerably from both the Budget and the mid-year report. Mr. 
Speaker, during the preparation of the 1987-88 Budget one year ago this Government faced 
Sole difficult decisions. We needed to choose between severe cuts in the level of public 
services or otherwise absorbing the largest projected Current Account deficit in our history. 
Undaunted by these difficulties are made a clearly balanced choice. We believe the people of 
this Province deserve the highest level of Government. services we can afford, and if that 
means I have to periodically stretch our resources to the limit to provide those services, then 
that is what this Government is prepared to do. This Government has the resolve and courage 
to make the hard choices for the benefit of all Newfoundlanders and Labradorians and to 
show confidence in ourselves and our future. I can report to you now that our confidence has 
been rewarded in large measure.

In the Budget of April, 1987, Government projected a deficit on Current Account of $173 
million. Mr. Speaker, I am extremely pleased to report to this House today that title are now 
estimating the 1987-88 Current Account deficit to be $58 million, or $115 million less than 
originally projected. Favorable changes to our estimates of revenues and expenditures account 
for $90 million of this improvement, while the remaining $25 million is due to a technical 
change in the accounting treatment of stinking fund revenues. Our revenue position improved 
dramatically because of the Province's strong economic performance. On the expenditure 
side, we saw the benefits of restricted measures instituted last year and, as well, our debt 
servicing cost there reduced substantially as a result of the strengthening of the Canadian 
dollar against its U.S. counterpart.

Improvements in our Current Account revenues contributed $63
million to the decrease in our deficit from the 1987 Budget projection. About 85 percent of 
this extra revenue was from Provincial tax sources, clearly indicating that the Newfoundland 
consumer and the Newfoundland business community share our confidence in the bright 
economic future of our Province. Retail sales tax revenues alone exceeded our Budget 
estimates by $26 million, with the strength in retail trade being centered on big ticket items 
like automobiles.

With respect to the 1987-88 Capital Account program, overall expenditures,. despite 
increased requirements for resource sector initiatives, are $24 million less than	budgeted 
primarily because of the timing of cash flows on a number of announced projects. Included in 
this $24 million is a $6 million reduction in Capital requirements resulting from the very 
successful issuance of savings bonds by the Newfoundland and Labrador Development 
Corporation. Our total borrowing requirements for the year will be $121 million lower than 
original estimates because of the decreased Current and Capital Account requirements as I 
have indicated.

Clearly, this substantial reduction in the total financial requirement represents a major 
improvement over the Budget forecast and an achievement of some considerable importance 
to this Province.

Mr. Speaker, the past year was marked by continuing improvement in the Provincial economy 
following full recovery from the recession of the early 1980s. The Province's gross domestic 
product grew by approximately 2.6 percent in real terms during 1987. Our resource-based 
industries, which link the performance of the economy of Newfoundland and Labrador to the 
performance of other countries, benefited from continued growth in the international 
economy. Demand for newsprint was strong in international. markets, and the total volume of 
newsprint shipments increased by 8.4 percent over 1986 levels. The increase in newsprint 
production caused pulpwood production to rise by 4-6 percent during 1987. Higher average 
prices for fish products translated into higher prices paid to fishermen, as the total value of 
landings increased by approximately 36 percent, more than offsetting a slight decline in 
volume. The price of cod fillet was up by 9.7 percent on average while the price for cod block 
rose by 15.9 percent. The total value of mineral production was doing by approximately six 
percent in 1987, mainly due to a decline intro ore production in western Labrador.

Mineral exploration expenditures, however, increased by about two-thirds to approximately 
$26 million, the highest level ever recorded in the Province. The construction industry 
enjoyed an extremely good year in 1987, benefiting from an increase of 3'3 percent in the 
total level of gross investment in the Province last year. Employment in the construction 
industry rose by 2,000 on an annual average basis to its highest level since 1980.

The service sector benefited from a solid performance in the goods producing industrials, 
strong gains in personal income, increased levels of tourism and exceptionally high levels of 
consumer expenditures. The Province's inflation rate of 2.9 percent the second lowest of any 
Canadian province, and the lowest recorded for Newfoundland since 1971 inflation and 
interest rates, combined with an increase of 7.4- percent in personal income, boosted 
consumer confidence and spending. In 1987, the value of retail trade increased by 11.3 
percent in current dollars, and 8.2 percent in real terms. This was the strongest real growth 
rate in retail trade experienced in the Province since 1971.

In 1987, employment increased for the second consecutive year by 5,000 on an annual 
average basis. Given the seasonal nature of some Provincial industries, this translates into at 
least 10,000" individual jobs created during the year. Employment growth exceeded growth in 
the labour force causing the unemployment rate to fall 1. 4 percentage points to 18,1 percent 
on an annual basis , it’s lowest level in five years.

Mr. Speaker, I am predicting with confidence that the Provincial economy will continue to 
experience strong growth in 1988. The Province's gross domestic product is forecast to grow 
by 2.2 percent in real terms. The Province's primary resource industries will benefit from 
continued international economic expansion. Economic growth in the G-7 countries is 
expected to average 2.3 percent in real terms. In the Province's main export market, the 
United States, real economic growth in the order of two percent is anticipated. Economic 
growth in Canada is forecasted to be about 2.8 percent in real terms. The Province is service 
sector will be stimulated by growth in the goods producing industries, higher levels of 
Employment and gains in personal income. An expected inflation rate of only 3.2 percent will 
service enhance consider and business confidence in 1988. This compares favourably to a 
projected inflation rate of 4.1 percent for Canada as a whole.

Employment growth in the order of 2.2 percent, or 4,000 person-years, can be expected for 
Newfoundland in 1988. Based upon the high level of employment experienced during the first 
two months of this year, this appears very reasonable. The actual number of new jobs created 
could be as high as 8,000. With slower growth in the labour force, the unemployment rate is 
expected to average approximately 17.4 percent, a decline of 1.1 percentage points from 1987 
and 2.6 points from 1986.

Mr. Speaker, despite the current low levels of world oil prices, exploration activity offshore 
Newfoundland continues at a healthy pace, albeit somewhat below the peak levels of 1983 
and 1984. During 1987, five new wells were started, with total expenditures of just under 
$200 million. So far in 1988, one new well has been spudded, while drilling  continues on two 
of those commenced last year. We expect that exploration activity will increase substantially 
over the next few years.

Although the drop "in oil prices has made the Hibernia negotiation process more difficult, 
intense negotiations continue and Government is optimistic that a decision on Hibernia 
development will be reached within the next few months. Both levels of Government 
recognize the overall importance of the 500 million barrel plus Hibernia field in meeting the 
energy security needs of Canada. They also recognize the need for the stimulus to the 
economies of eastern Canada that Hibernia development would provide.

Recent positive results from the delineation drilling program on the Terra Nova discovery 
lend further cause for' optimism, with recoverable resource estimates at least doubling from 
70 million barrels to in excess of 140 million barrels. The operator of the field continues to 
actively delineate the structure, and a decision to proceed with development is expected in 
1989. Evaluation is also proceeding at the Whiterose structure. To date, two delineation wells 
have been drilled and a third is nearing completion. If the 300 million barrel recoverable oil 
estimate made by the Department of Energy prior to the drilling of the current E-09 well can 
be confirmed, then this field would also quickly become a candidate for development. In 
addition, the Canada-Newfoundland Offshore Petroleum Board has called for the submission 
of bids on eight promising parcels in the Newfoundland offshore area, chosen as a result of 
nominations by interested companies. The call for bids has been issued for more than 250,000 
unexplored hectares on the Grand Banks in the vicinity of the Hibernia, Terra Nova and 
Whiterose discoveries. The very high level of industry interest in the sale is expected to result 
in the drilling of at least eight new offshore wells during the next three years, with seismic 
surveys and other preparatory activity likely to get underway in 1989. This should lead to 
further increases in proven reserves of oil and gas on the Grand Banks.

Mr. Speaker, the reactivation of the Come-by-Chance oil refinery in 1987 marked a 
significant event and has resulted in the full-time employment of 270 people at the facility. 
Five hundred workers were employed at peak periods during the restoration process. 
Additional investment is scheduled for 1988, which would increase the operational efficiency 
of the refinery. The capability to produce additional quantities of jet fuels and. distillates is 
expected during 1988. Government believes that the energy provisions of the Free Trade 
Agreement recently reached between .the Governments of Canada and the United States will 
result in expanded opportunities for the Come-by-Chance oil refinery, for Hibernia and other 
offshore developments, and for Labrador hydro mega projects. This will be accomplished 
without compromising the local preference provisions so hard fought for by this Government.

Mr. Speaker, Government is very pleased with the dramatic improvement in our financial 
position for the fiscal year about to end. As my predecessor stated in the 1987 Budget Speech, 
Government is committed and determined to eliminate our Current Account deficit within the 
next few years.

This Honourable House that the projected' Current Account requirement for 1988-89 is $41 
million, which is only 1.6 percent of our total Current Account budget. The net Current 
Account expenditure growth rate for 1988-89 is projected to be 6.S percent while Current 
Account revenue will increase by 7.6 percent. While growth in Provincial tax source revenues 
is not expected to equal last year is performance, modest increases in incomes and spending, 
triggered in part by the increase in persona1 disposable income resulting from tax reform, 
wi11 increase our tax revenues by about four percent. Equalization transfers from the 
government of Canada forecast to grow substantially this year, reflecting the strength of the 
Canadian economy.

The net Capital Account requirement for 1988-89 is projected to be $221 mi11ion. The 
resulting budgetary requirement for Current and Capital Account combined of $262 million 
compares favourably with that of recent years, and is now projected to be just 8.9 percent of 
total spending.

We are making considerable progress towards our desired goal of having a Current Account 
surplus. As well, our debt service ratio for 1988--89 wi11 bE! 15.9 percent, its lowest level 
since 1983-84.

Accordingly, Government has formulated a financial strategy for the new fiscal year wh1ch 
forecasts a further 30 percent reduction in our Current Account requirement. The following 
table outlines the details of our 1988-89 financial position. I am extremely pleased to 
announce to

Mr. Speaker, while this Government is still facing a Current Account deficit, expenditure 
reduce is on options are limited. In five successive Budgets since 1983 Government has 
introduced no major tax increases, even though each year we faced a difficult budgetary 
situation. This is a Government of sound financial and fiscal management, but also one 
sensitive to the needs and desires of Newfoundlanders and Labradorians.

This year, Mr. Speaker, have continued to hold fast. I am, therefore, particularly pleased to 
announce that this Budget will see no significant increase in the Provincial tax burden . . . by 
our population. This will be a key element in building on the private sector strength our 
economy is now exhibiting, which in itself translates into higher Government revenues. Most 
individual taxpayers in this Province will see their Newfoundland and Federal income taxes 
reduced in 1988 and subsequent years due to tax reform. Not only have we foregone major tax 
increases for our sixth consecutive year, but this Government has preserved significant 
income tax savings generated by tax reform.

Mr. Speaker, in keeping with our objective of restraining the budgetary deficit, I am 
introducing the following modest revenue raising. The Newfoundland Liquor Corporation is 
requested to generate an additional $2.0 million for the Province.

Various departmental fees and licenses will be increased to generate an additional $1.3 
million. These increases include fines under the Highway Traffic Act, non-resident hunting 
and fishing licenses, liquor establishment licenses and registrations related to a wide range of 
sales activities.

The retail sales tax will now be applied to extended warranties and maintenance contracts at 
the time the contract is entered into rather than when the warranty work is performed, making 
our treatment consistent with other provinces. This will generate an additional $500,000.

On the other hand, Mr. Speaker, I am pleased to announce the following positive changes as a 
direct result of Government's ongoing monitoring and rationalization of tax exemption 
policies and legislation:

A retail sales tax exemption will be introduced for dental filling materials. This measure will 
ensure that sales tax on these mater1als does not serve to increase the cost of dental care, so 
important, particularly to our young people.

The current retail sales tax exemption for propane, which is limited to quantities delivered in 
89 litre capacity or larger cylinders, is inequitable particularly to rural areas of our Province 
delivery service is not available. Effective immediately, this exemption is extended to all 
consumers regardless of their place of habitat and their method of delivery.

The provision in the Retail Sales Tax Act that requires a supplier of a taxed service to pay tax 
when . . . of its will services will be repealed. For the past number of years, Government has 
assigned a significant vacancy reduction factor to departmental salaries which has resulted in 
the accumulation of a number of long-term vacancies in the permanent complement. 
Government has now decided to eliminate over 400 of those posts which have not been filled 
for a period in excess of 18 months. In future, departments will also be required to achieve a 
standard enforced savings reduction in their total non-cost-shared salary budgets of 
approximately four percent of their approved similarly budget. Additionally, as part of an 
ongoing effort to streamline operations, Government has identified several areas where 
minimal lay-offs will be implemented.

Mr. Speaker, over the last several years this Government has offered a number of tax 
incentives designed to stimulate the Provincial economy and improve the prospects of all bur 
residents. Examples of these supportive initiatives include: the sales tax exemption for 
handcrafted products, the sales tax exemption for manufacturing equipment, the reduction of 
the small business income tax rate and the small business income tax holiday.

I wish to take this opportunity to dispel the popular misconception that Newfoundlanders and 
Labradorians are the most tax people in the nation. This misconception arises for the highly 
visible tax rates applicable to our personal income and consumption taxes. However, any 
analysis of relative tax effort must encompass the entire range of revenue raising activities 
undertaken within the province. This analysis reveals that Newfoundland tax effort is not as 
heavy as many believe. 

Two major factors influencing the Provincial taxation system relate to our municipal 
government and resource sectors. At this stage in the development of municipal government, 
the Province is required to fund many of the services, including education to a large extent, 
which are provided by municipalities 'in some other jurisdictions. Also, economic factors 
associated 6th many resource developments in this Province result in relatively low levels of 
Government revenues from these sectors.

Mr. Speaker, in assessing tax effort one would be remiss to ignore those forms of taxation not 
utilized in this Province. Although our personal income tax rate appears high in relation to 
other provinces, we have not followed their lead in resorting to other measures such as 
personal income flat taxes or surtaxes. Similarly, residents of this Province are not subjected 
to health insurance premiums or pay roll taxes which generated substantial revenues in some 
other provinces. These factors necessitate a concentration of our tax effort in the more visible 
taxation fields. Empirical evidence reveals that the overall Provincial and local government 
tax effort in Newfoundland during the 1986 – 87 f isca1 year was just 102 percent of the 
national average, which was lower than that in Quebec and Manitoba and equal to the tax 
effort in Ontario.

Mr. Speaker, this Province has been a participant -in the reform of the Canadian tax system 
which has initiated by my Federal counterpart. The general thrust of tax reform has been to 
lower rates and broaden the tax base. For individual taxpayers in this Province, the collective 
Federal and Newfoundland personal income tax bill I will be $50 million less in 1988 than it 
would otherwise have been. Approximately 90 percent of Newfoundland taxpayers will 
directly experience an increase in their disposable income as a result of these measures. In 
fact, 25,000 individuals on the lower end of the income scale will be removed from the 
income tax rolls completely. These savings will be reflected on pay cheques commencing in 
July, when source deductions change to the lower tax rates.

This Government has some concern with respect to the possible impact on mineral 
exploration of modifications to the corporate tax rises for the mining' industry and has 
established a group if presenting Government and industry to examine this issue. The 
Province, however, is generally pleased with corporate income tax reform.

Discussions are currently ongoing between the Federal and Provincial Governments toward 
the feasibility of a national sales tax which would replace the current sales tax regimes of both 
orders of Government. Because of the complexity and implications of this issue, sales tax 
reform will not occur before 1990. The Province has not yet developed a position on 
participation in a national sales tax system, and will not do . . .  it all details are known. Some 
of our initial concerns have been alleviated in that the Federal and Provincial Finance 
Ministers have agreed that food would not be taxed and that the municipality, university, 
school and hospital sectors would not have their tax burdens increased.

Mr. Speaker, this Government will continue sectors to have improvements made to the 
Equalization Program, including an examination of the regional costs of providing public 
services, and alternative treatments of non-renewable resource revenues. Other issues under 
the Fiscal Arrangements include continued restraint of the Established Programs Financing 
transfers, through which financial support is provided for Provincial health and post-
secondary education programs, and Provincial income tax flexibility through the tax 
collection agreements.

To other respects, the Province is generally pleased with the review of the Fiscal 
Arrangements for the 1987 to 1992 period which was finalized last year. Particularly 
welcomed were the technical adjustments made to the Equalization Program, which improved 
the measurement of the relative revenue generating capacity of provinces.

Mr. Speaker, this Government has a longstanding commitment to stimulating business 
opportunities in the Province, recently . . .  by our response commendations of the Royal 
Commission on Employment and Unemployment, which recognized the tremendous 
contribution of this sector to economic growth and employment. We believe that 
Newfoundland and Labrador is witnessing the emergence of an entrepreneurial spirit, and this 
Government is doing its part by creating an environment in which businesses can prosper.

Mr. Speaker, in 1988 we will be continuing the support to the Province is business sector that 
we enhanced so significantly last year. Within the next couple of months this Government is 
planning to implement the Newfoundland Stock Savings Plan. This initiative will provide 
financial incentives to individuals who participate in this program, and will result in badly 
needed equity capital for enterprising Newfoundlanders. Discussions are currently ongoing 
with the Honourable Michael Wilson with a view to having part of this incentive delivered as 
tax credits boulder the Canada-Newfoundland Tax Collection Agreement. A grant supplement 
also behold be provided as an additional incentive for investing in smaller, higher risk 
operations.

The new and expanded programs at the Newfoundland and Labrador Development 
Corporation (NLDC) and the Department of Rural, Agricultural and Northern Development, 
which were extremely well received last year, will be continued. Funding for the financial 
assistance programs at NLDC has provided by the proceeds from the sale to public of 
Development Savings Bonds in 1987. This initiative, the first of its kind in Canada, resulted 
in $8.9 million in bonds being purchased by Newfoundlanders and Labradorians. Considering 
that these bonds were in direct competition with Canada Savings Bonds, the success of this 
issue proves that the people of this Province share our confidence in our future. Because of 
the strong response to the first issue of Development Savings Bonds, annual issues are now 
planned, which will provide the funding for NLDC is financial assistance programs.

Mr. Speaker, I believe that our third investment business incentive area are tailored for 
success because of the extent of the involvement of the private sector in their development. 
Over the past year, a number of task forces comprising representatives of business, 
Government, and the economic COHC of Newfoundland and Labrador have studied new 
policy concepts and made recommendations for Government consideration. This cooperative 
spirit will help ensure that Government delivers the programs that business needs to put our 
vast resources to work generating wealth and employment now and into the future.

The establishment of the Atlantic Canada Opportunities Agency CACOA was announced by 
the Primer Minister in June, 1986 in recognition that special measures required 'in 
Newfound1and and the Maritime Provinces in order to assist and stimulate economic 
development activities. The Prime Minister announced that the ACOA would be provided 
with a five-year budget of $1.05 billion and that these funds would be additional to the current 
levels of expenditures for regional development activities.

Since then, the Province and ACOA have initiated discussions to develop appropriate and 
flexible programs adapted 'specifically to meet the needs and requirements of the Province is 
business community and our general economic development. The $1.05 billion in new 
funding will be directed primarily to the private sector 1-:0 allow for new business 
developments and the expansion and/or modernization of existing business. Considerable 
emphasis will also be placed on entrepreneurial development and training and financial 
support will be provided to non-commercial agencies who support business and private sector 
development including research and development education and training promotion and 
marketing.

Over the next year we intend to work closely with the Atlantic Canada Opportunities Agency 
to develop and deliver new and meaningful programs ensuring the maximum benefit for our' 
province.

We intend to simplify and streamline the delivery of programs furthering the one-stop 
shopping concept and where possible avoiding duplication and conflict between Federal and 
Provincial programs. Senior Expenditure Committee Review Mr. Speaker last year my 
predecessor announced that a Senior Expended there Review Committee would be established 
to undertake a of the efficiency and effectiveness of Government’s operations and to develop 
a multi-year plan to eliminate the Current Account deficit. The Committee consisting of four 
senior Deputy Ministers and supported by a small research group has been undertaking its 
review during most of the past year and will continue its work during the 1988-89 fiscal year. 
Since its inception the Senior Expenditure Review Committee has provided periodic reports 
to Government on a wide variety of matters. In preparing these reports, the Committee has 
worked closely with line departments to identify ways to reduce the growth rate in their 
expenses.

A key element of the Senior Expenditure Review Committee’s activities during 1988-89 will 
be overseeing the operational reviews by external consu1tants of those Government 
departments. On the recommendation of the Committee, Government has selected the 
Departments of Social Services and Public Works and Services on a pilot project basis to 
undergo a comprehensive analysis often operations from an objective and professional 
perspective. Government issued a proposal call recently and will award a contract after 
analyzing the various proposals that are received. Based on the results of these studies, 
Government hopes to improve upon the efficiency and effectiveness of the operations of these 
two departments and others as the circumstances warrant.

Mr. Speaker the Senior Expenditure Review Committee is viewed as a vital instrument to 
assist Government in achieving its objective of eliminating the Current Account deficit. I am 
optimistic that their further work and subsequent reports will identify a clear path to a 
balanced budget in the years ahead.

Mr. Speaker, the Government of Newfoundland and Labrador has experienced difficult 
financial times in the 1980s. Indeed, no Administration of this Province throughout history 
has ever been in a position to give our people the level of public services which they would 
like and which they so clearly deserve. Our goals and objectives for improved services and a 
higher standard of living have always had to be tempered and cut to fit an economic and 
financial cloth that, quite frankly, has never been sufficient. We have had to do this in order to 
maintain the Province is fiscal integrity and credibility.

Despite this less than ideal economic and financial climate, the Peckford Administration has a 
considered the people this Province is greatest asset and has endeavor against the harsh 
financial realities, to provide ever-improving public services and infrastructure throughout 
every region of the Province. I stand here today as a proud Member of the Peckford 
Government, which for the past nine years has built an impressive record of accomplishments 
for our people while at the same time strengthening our reputation as competent fiscal 
managers in the financial capitals of the world.

Over the past nine years, we have demonstrated clearly a strong commitment to the 
enrichment of our social programs. In fact, not only have we provided generates increases 
beyond the average growth in Consumer's Price Trend we have both enriched and created new 
programs in high priority areas. In particular, I would single out the following initiatives: a 
new Municipal Grants Program; a new Senior Citizens I Drug Program; major initiatives to 
improve the secondary and post-secondary school systems; enrichment of the pupil teacher 
ratio; a significantly expanded Community Development Employment Program; major 
improvements in Provincial ferry services; a new tax Equalization Program for school boards; 
major increases in the number of senior citizens' beds funded; provisions for new or expanded 
hospitals at Channel, Grand Falls, Bonavista, Clarenville and Burin; and significant growth in 
allocations for new school construction.

Despite the difficult restraint period we have had to cope with, our commitment to essential 
social programs was not sacrificed. This Administration is proud of our achievement in this 
regard and to support our record I would like to cite examples of our achievement. The annual 
average compound growth rate over the past nine years has been:

9 percent for college and Institute support;
15 percent for Student Aid program;
9 percent for teacher salary costs;
13 percent for municipal operating grants;
28 percent for Community level open Program;
10 percent for Medical Care commission;
12 percent for senior citizens I homes; and
9.5 percent for hospital operating grants.

These growth rates and new initiatives in the social sector, when compared to the 7.4 percent 
annual average growth rate in the Consumer Price Index, demonstrate our commitment to 
bring our social programs up to national standards without compromising our financial 
credibility.

The Budget I am presenting today reflects the continuing determination of this Government to 
broaden and improve the services we provide to our people. Accordingly, Mr. Speaker, I 
would now like to highlight some of the major expenditures included in the budget for the 
new fiscal year. Where applicable, the expenditures projected are consistent with the three-
year capital expenditure restraints announced in last year's Budget.

As a continued demonstration of our commitment to Government pensioners, I am pleased to 
announce that I soon tariff be introducing legislation which will grant an increase to all 
pensioners of at least three percent effective April 1, 1988. As well, recognizing the impact of 
the cost of living on those pensioners who have been on pension for ten years or more, 
Government will grant an additional one percent for each year a person was on pension prior 
to 1978 to a maximum total increase of ten percent. Finally, in order to assist those pensioners 
with small pensions and those spouses of deceased pensioners who receive limited survivor 
benefits, Government will increase the minimum pensions by 23 percent from $2,200 to 2,700 
per annum.

The future of our Province is undeniably the children and youth of today. This Administration 
has always recognized this fact and has promoted education in many ways - the introduction 
of Grade XII in our high school program, those creation of a new Department of Career 
Development and Advanced Studies, the introduction of a new community college system, 
the significant expansion that has taken place at memorial University of Newfoundland, and 
the list goes on. In fact, Mr. Speaker, expenditures on education in this Province as a 
percentage of both gross domestic product and personal income are the highest in

At the same time, we know that it costs more in some parts of the Province to provide a basic 
education to students. The costs vary for a number of reasons: population density, schoo1, 
size, transportation, special needs of students, Newfoundland. We also know that there are 
great disparities among school boards in the amount of local tax assessments available to 
them.

Recognizing this, Government recent, announced its intention to undertake, this year, a .full 
review of all issues involved in funding elementary and secondary education. The goal is to 
ensure that our method of financing education is a fair and equitable one, which provides 
school boards across the Province with sufficient revenues to meet the needs of their students.

The present system of funding provides some help for school boards that have low fiscal 
capacity and high costs. A school tax equalization grant of $2 million was introduced in 1986 
and increased to $2.5 million in 1987. I am pleased to announce that the tax equalization grant 
will be increased by 80 percent to $4.5 million in the fiscal year 1988-89.

Government intends to place before this Session of the House of Assembly a Bill to amend 
the Schools Act, which will remove the requirement that boards pay ten percent of the cost of 
school construction from local revenues. This will enable the denominational education 
councils to fund the full cost of school construction projects where boards are unable to share 
a portion of the cost. Also, Government will extend its commitment of $20 million a year for 
school construction into 1990-91. This multi-year commitment of $60 million will give the 
internationa1 education councils the flexibility to develop long-term plans for school 
construction and will facilitate the tendering process.

In order to improve access to mathematics and science courses in many rural schools in the
Province, the Department of Education will undertake a pilot project using Distance 
Education Technology. Beginning in September, 1988, students in 13 small schools will have 
access to the first of three courses in advanced mathematics. In subsequent years during the 
pilot project phase, students will be able to take additional courses in advanced mathematics 
and physics. This project, costing $233,900 in 1988-89, will better prepare students to pursue 
careers in the scientific and technological areas that are vital to the future development of our 
Province.

Government has committed itself to a five year plan to province guidance counselors, school 
librarians, and additional teachers for small schools. Fifty new teaching positions were 
assigned for that purpose this year, and I am pleased to announce that an additional 50 
positions are committed for 1988-89 at a cost of approximately $1.5 million. When fully 
implemented, the allocation of specialist personnel to these positions will enable school 
boards to greatly improve guidance and library services, and would also help reduce class 
sizes by releasing regular teacher’s allocations now used in these positions for assignment to 
classroom teaching.

This fiscal year will see the continuation of the implementation of a Provincial community 
college system that began in September, 1987. During the fiscal year, Government will 
provide financial assistance through the Department of Career Development and Advanced 
Studies for the introduction of a grant-in-aid system for the five new community college 
regions, totaling $31,3 million. In addition, $2 million has been approved for the acquisition 
of equipment to update and replace outdated equipment for the various programs being 
offered by the community colleges.

Funds also be provided to continue with the major construction projects that were initiated 
this past year at various Campuses. This includes, capital funding in the amount of $4.2 
million from the Canada-Newfoundland Offshore Development fund and $2.9 million in 
Provincial funding with 1988-89 cash flow requirements allocated as follows:

The conversion to a grant-in-aid funding system and the new funding be-long provided to 
update equipment should enable the community colleges to become wed. I established and 
fully operational over the next fiscal year. I am pleased to indicate that Advanced Studies 
funding overall will see a very significant increase of 20.1 percent to a total of $221.5 million.

Mr. Speaker, in 1987-87, $5 million was approved for a new Private Sector Employment 
Initiative Program where Government proposed to match funds provided by businesses in the 
creation of new jobs. This initiative was a tremendous success with funding preference giving 
to long employment especially where some training was provided. Approximately 760 private 
companies received funding, creating some 2,000 jobs at an average of 25 weeks duration 
each. Close to 1000 of the jobs involved 52 weeks of work, while 570 of the jobs created were 
student positions. Bearing in mind that youth includes more than students, approximately 50 
percent of the positions filled were by young people in the age group of 18-25 years. 
Approximately 48 percent of the jobs were filled by female employees. The program designed 
to stimulate economic activity and create real job opportunities. Government's $5 million 
investment was matched dollar for dollar with private sector funding, which essentially means 
that $10 million worth of employment activity was generated.

I am happy to report that for the 1988--89 fiscal year', $7.5 million has been budgeted, a 50 
percent increase over last year. This program will also have a you will and student 
component.

Based upon last years’ statistics this initiative should create approximately 3,000 new jobs 
generating $15 million worth of employment activity. Mr. Speaker, government views this 
program' as the key element our efforts to improve employment prospects for young people, 
and a significant contribution to the improving employment performance generally.

One of the most difficult problems facing young graduates is finding "that first job". 
Regardless of their level of formal education and training their lack of on-the-job experience 
is frequently a major obstacle.

Government invests considerable' funds in post-secondary education in the Province. Our 
young people invest many years and large amounts of money, frequently at a considerable 
sacrifice to both themselves and their families. A number of them graduate with a heavy debt 
to repay, and should they be unable to find employment that utilize their education and 
training, the financial loss both personally and to the Province is great.

To complement the recently announced Federal youth employment Program, I am pleased to 
announce that. $1 million has for a real Graduate Employment Program. The goal is to test a 
model that will facilitate the entry of highly educated youth and provide them with specific 
training and on-the-job orientation. This is also a wage subsidy program with up to 50 percent 
of the hourly rate of eligible employees reimbursed to the employer for up to 52 weeks to a 
maximum of $8,000 per position.

All employers from both the public and private sector are eligible to participate. The $1 
million program can be expected to provide employment for approximately 125 graduates 
University, institute and community college graduates are eligible.

Al though there has being a change in the number of women entering some professions that 
were formerly male dominated, there is very little progress in technical and trades 
occupational areas. The situation may be more difficult in this Province, due to our 
unemployment rate and fewer opportunities for industrial jobs. Women continue to work 
primarily included sells and service jobs, which are usually at the lowest end of the salary 
scale. In order to improve the economic prospects of women, special efforts will have to be 
made to widen their range of career choices and improve their access to areas of work that 
have been traditionally male-dominated.

I am pleased to announce that an amount of $500,000 has been budgeted for an employment 
program at occupational integration for women. This wage subsidy program will provide 50 
percent of the starting salary up to a inflation of $81000 per job for a maximum of 52 weeks. 
This funding will provide employment for approximately 60 women in occupations 
dominated by males.

The really created Division of Career Support Services of the Department of Career 
Development and Advanced Studies will phase in a number of services and programs in the 
coming year designed to assist the public path career planning, with a view towards increasing 
the participation rate in post-secondary education.

A provision of approximately $1.9 million for the Career Awards Program. The Canada-
Newfoundland Offshore Development Fund will continue providing financial assistance to 
university undergraduates and students enrolled in two and three year diploma programs in 
applied arts and technology. Funds will also be available for the support of graduate 
fellowships. The underlying basis for awards under the Career Development Awards Program 
is the development of excellence among students and faculty in the post-secondary sector. 
The program is predicated on the "importance of investing "in our people, especially our 
youth.

In addition to all these programs, Mr. Speaker, Government has made provision in the Budget 
for the following capital projects in the field of education:

An amount of $4.6 million has been allocated to complete construction of the new $7 million 
Fine Aris Facility at the Sir' Wilfred Grenfell College "in Corner Brook. An amount of $15 
million has been provided for the continued construction of the centre for Earth Resources 
Research at Memorial University in St. John's, which is estimated to cost $25 million.

Funding of $2 million has been allocated for the completion of construction of the Centre for 
Remote Medicine and Telemedicine at Memorial University.

An allocation of $3 million has 'been provided for the construction of a $5 million Survival 
Centre at the Institute of Fisheries and Marine Technology.

An amount of $3.9 million has been allocated for the construction of a $12 million Simulator. 
Training Centre relative to ship handling and ballast control operations, also at the Institute of 
Fisheries and Marine Technology.

Funding of $2.5 million has been provided for projects directly related to petroleum 
technology training at the Cabot institute of Applied Arts and Technology.

Mr. Speaker, Government continues to place a high priority on the development and 
maintenance of a comprehensive network of health care services to meet the health care needs 
of the people of our Province.

We recognize the implications for health care services of the aging population. While our goal 
is to keep people in their own homes and communities as long as possible, it is recognized 
that at some point they may require institutional care. Recognizing this reality, Government 
continues to expand the number of nursing home beds available in the Province. Presently, 
there are over 200 additional nursing home blinds in various stages of construction in the 
Province. Government expects to be in a position shortly to authorize a 110 bed expansion to 
the incentive

Boarding Home Program within the Province. Under this program funding is provided for the 
support of residents in homes constructed and managed by private operators. Funding wi1l 
also be provided this yield to enhance our community-based services. As well, a 
comprehensive continuing care plan will be developed by the Department of Health. All these 
measures are aimed at strengthening services to our senior citizens and other citizens these 
services total funding. For senior citizens' institutions and related expenditures will increase 
by 10.6 percent overall to $78.7 million.

Once optometry coverage was introduced in 1981, many Newfoundlanders have availed of 
this service to the point where the service will now be insured once every two years instead of 
once per year. This frequency certainly provides for reasonable coverage, given the demands 
that exist for a variety of health care services.

In order to provide for treatment of individuals with alcohol or drug-related problems within 
the Province, this year's Budget will provide an additional $300,000 in funding to the Alcohol 
and Drug Dependency Commtssion to initiate a comprehensive program in cooperation wtth 
the Western Memorial Regional Hospital in Corner Brook.

In 1988-89 Government will spend over $11 million on various capital works projects 
throughout the Province to ensure that the Province has a good and well maintained network 
of health care facilities. The new Clarenville Hospital is completed and continues to phase in 
operations while the new hospital at Salt Pond on the Burin Peninsula will commence the 
phase-in of operations this year. Funding of $5.1 mil1ion has been provided to virtually 
complete the major redevelopment of the Central Newfoundland Regional Health Care Centre 
in Grand Falls at a total cost of $20.9 million. As an amount of $500, 000 has been allocated 
to start construction of the Roddickton Health Centre at an estimated cost of $1.6 million and 
$ 1.9 million has been allocated to complete the Chronic Care/Clinic Facility at Botwood.

In addition, funding has been provided for smaller projects at various institutions around the 
Province. Amounts of $200,000 each have been provided for fire and life safety upgrading at 
the Curtis Hospital in St. Anthony, the Leonard A. Miller Centre in St. John's and the Health 
Sciences Centre. An amount of $200,000 has been provided for upgrading of 
heating/ventilation and life safety systems at the Sir Thomas Roddick Hospital in 
Stephenville.

The James Paton Memorial Hospital in Gander will receive $150,000 to connect to the 
municipal seller system. I am also pleased to announce that $65,000 has been allocated 
towards the cost of life upgrading of the detoxification center in Ta1bot in St.John  is 

Mr. Speaker, I am pleased to announce that: Provision has been made in the Budget of the 
Department of Social Services for' a four percent increase in all components of the Social 
Assistance rates effective

May 1, 1988. Provision is also made for' a four percent increase for Foster Home and Child 
Welfare Allowances to take effect April I, 1988.

With the introduce on of the Federal youth Offenders Act and the Provincial Young Persons' 
Offenses Act several years ago, the Department of Social Services has recognized the need for 
a new secure custody facility designed to accommodate young offenders under the age of 18 
years. A detailed facility planning process has been ongoing regarding size, composition, 
design characteristics, programs and philosophy of the new secure custody system. This 
system will provide effective safety and security for residents and staff adequately 
opportunities for rehabilitation and self-development aimed at facilitating future law abiding 
behaviour and adequate social adjustment. I am extremely pleased to announce that $3.S 
million has been allocated for the first phase in the construction of a major secure custody 
facility.

Mr. Speaker, Government is very conscious of our unemployment rate especially when 
compared to other provinces. We have continued to place the highest of emphasis on the 
development of our resource potential yet we still have many unemployed Newfoundlanders.

A few years ago, Government introduced the Community Development Program which was 
designed to employ many Newfoundly who would otherwise be out of work. We have found 
his program to be extremely successful and I am pleased to announce that funding of $32 
million is provided in the Budget: for suppose in next fiscal year. In addition, $3.3 million is 
to be provided under the Federal-Provincial Employment Enhancement Program. These 
programs are expected to provide 13,000 14,000 short term jobs.

In 1988 this Province is celebrating the 100th Anniversary of the establishment of municipal 
government in Newfoundland and Labrador. The first Local Government Act was passed on 
May 9th, 1888, whereby the City of St. John's became the first full fledged municipality in 
this Province.

Government believes this event is of such significant in the history of municipal government 
that a six-month period of municipal celebrations will take place starting on May 9th, 1988 
and concluding with the Annual Meeting of the Federation of Municipalities in October on 
Thanksgiving weekend. This has resulted in funding being provided, when the municipal 
contribution is included, of $750 000 to cover more than ISO projects throughout the Province 
to celebrate this historic milestone.

The purpose of the celebrations, know as Soilnee 188, is to develop pride in service to one is 
communtly by encouraging people to stand for local government office, to create specific 
activities in these communities which would improve their visitor enhancement image, and to 
encourage former residents of this Provinceto corne back and visit their own home towns 
during the official celebrations. I am confident that Soiree 188 will be extremely beneficial to 
all areas of the Province and will increase tourism throughout Newfoundland in 1988.

Government will continue to assist municipalities to provide water and sever services, and to 
construct roads. During the coming fiscal year, a further $75 million will be made available 
through guaranteed loans to enable municipalities 1-.0 expand these services in highly critical. 
Details	of light progress will be released in due course by my Colleague, the Minister of
Municipal Affairs. Additional Capital expenditures for 1988-89 were allocated for 
municipalities totaling $22.9 million inclusive of:
-	water and sewer/road construction and paving debt principal payments ($16.3 
million); 
-	water' and Sealer servicing Coastal Labrador Native Peoples' Agreement ($2.6 
million); 
-	community water services ($800,000);  
-	waste management facilities($415,000);
-	industrial water supply systems ($569,600);
-	St. John’s regional water and sewer servicing ($595,000); and firefighting equipment 
($775,000) .

Government aid continue to support and encourage municipalities throughout the Province to 
take advantage of the Government of Canada is cost shared program of Joint Emergency 
Preparedness and will provide $350,000 in interim funding to municipalities pending receipt 
of the Federal contribution of an approved project. This add permit more municipalities to 
purchase equipment and materials under the program which will ultimately be filly cost 
should by the Government of Canada and Municipal Governments.

Government continues to be encouraged by the response of municipalities to the 
implementation of property tax as a means of increasing local revenues. Accordingly, in order 
that the imposition of property taxes may be expedited, Government will again increase the 
number of real property assessors that will be made available to carry out municipal 
assessments this time from 49 to 59. This add reduce considerably the waiting period now 
being experienced by municipalities in commencing their property assessment programs.

The 1987 Budget Speech indicated Government's intention to develop a more effective 
mechanism for the collection of court-ordered maintenance payments, and committed 
approximately $50,000, supplemented through Federal funding, to underwrite the costs 
associated with the necessary research and feasibility assessment. The preliminary work is 
now completed and Government in this Session will be introducing family local 
accommodation, including provisions for the establishment of a Province aide, automatically 
Maintenance Enforcement Program.

The Maintenance Enforcement Program will provide for improved collection remedies and 
relative penalties where there is an ability to pay. Complemented by Federal funding for 
systems development, Government plans to commit approximately $325,000 for the 
establishment of this program to ensure that beneficiaries of family support orders . . .  the 
economic support to which they are entitled.

Government has approved an expenditure of $1.6 million to construct a new Unified Family 
Court in St. John’s. This new facility will replace the original Unified Family Court which 
was destroyed by fire ""in August, 1986. Also, funding is provided for the operation of a 
Regional Fire Commissioner’s Office in Coroner Brook. This office, which will be staffed by 
a Fire Protective Supervisor and a Fit, Technician, will serve the western region of the 
Province.

Mr. Speaker, I have long been a believer that recreation and sport are critical to the 
development of a healthy and productive society in addition, sportsmanlike competition 
builds strength of character and pride in one self and one is community. I take great personal 
pride in the fact that the Town, and soon to become City, of Mount Pearl land this August 
host the 1988 Newfoundland and Labrador Games. I take even greater pride in the fact that 
for the first time in the history of this Province these Games will be fully integrated in that 
they will provide equal opportunities for persons with physical disabilities to compete. I invite 
everyone who is listening today to share in the experience of these Games which all bring 
young person and their families, from all over Newfoundland and Labrador all together in a 
spirit of friendly competition, while at the same time enjoying the high standard of hospitality 
for which the people of Mount Pearl are renowned.

Government's recreational programs are very comprehensive and I would like to list a few 
aspects that are pattern. Of the new fiscal year:

The Regional Recreation Facilities Program is a major new program designed to encourage 
communities of the Province to jointly build and operation major recreation facilities. After its 
announcement in mid-December by the Minister of Culture, recreation and Youth, the initial 
response was very encouraging and applications are presently under staff of the department.
Several high priority projects will shortly be announced and for others detailed feasibility 
studies, where required, will be carried out jointly by the municipalities involved and the 
Department. Funding of $1.7 million will be committed towards the construction of several 
new regional recreation facilities this year. The very successful Arena/Pool profit Program 
will continue this year and five new facilities will provided with funding to assist with the 
enhancement of their energy efficiency.

The Department of Culture, Recreation and Youth will initiate a Ptarmigan Habitat 
Enhancement Program with funding assistance from Wildlife Habitat Canada, a national 
foundation dedicated to encouraging the retention and enhancement: of wildlife habitats. This 
project, using controlled perhaps other techniques, will hopefully increase program number's.

Mr. Speaker, the Government has approved gross expenditures of $164.9 million for the 
Newfoundland and Labrador Housing Corporation in 1988-89. Highlights of the Corporation 
is program are as follows: A significant component of the activity of the Corporation in the 
1988-89 fiscal year will be delivery of an estimated 390 new social housing units throughout 
the Province to low income families, senior citizen will special needs . In addition, the 
Corporation will spend approximately $15.5 million in Federal-Provincial cost-shared 
housing repair funds. These expenditures will be directed to upgrading some 1,900 residential 
units that are occupied by low income homeowners and tenants in born urban and rural areas.

In recognition of the high heating costs being experienced by low income families and seniors 
living in the Corporation I s social housing units, I all pleased to announce that this Heating 
Allowance Program has been further enriched to total budget of $4.3 million. This represents 
the final phase of a three-year phased program such that a maximum subsidy will be livable 
eligible households in 1988-89.

Also $6.5 million has been allocated for the start of development of an estimated 250 
residential building lots for Mount Pearl and cost are Highs. An additional of $1.9 million will 
be spent on the ongoing planning and servicing relating to a number of industrial parks in 
various areas of the Province. Finally, an estimated $8 million has been committed for the 
renovation of the Corporation Is rental units across the Province as part of a continued 
upgrading and modernization program.

I anticipate that the residential construction sector will continue its healthy performance this 
year, as it has over the past two years. During 1986 and 1987 there IAJ('!re 2,700 and 2,800 
housing starts, especially in consideration of low mortgage interest rates and high 
constituency confidence should produce the positive climate required low income home 
owners hip and provide a boost to the residential construction industry in the Province:


Mr. Speaker, I have outlined some of the major social programs and projects that government 
has provided in the Budget for the new fiscal year. As important as they are, Government 
must continue to place ever-increasing emphasis on the development of the resource sector of 
our Province. Without a strong economic and financial foundation, we will not be able to fund 
the many demands for existing and new public services which our people want and should 
have. Of equal importance, we must continue to strive for that formula in our economy which 
wtl1 yield more jobs, enough jobs so that all Newfoundlanders will have the opportunity to 
obtain employment and with it, economic security and self-fulfillment.

The solution to the vexing problem of unemployment is not easy and our Province is not 
alone in wrestling with this phenomenon which exists on every continent and in many 
countries 1-0 a much greater extent than here at home. The Peckford Administration has 
compiled a record of job creation over the last nine years which reflects the importance this 
Government attach to it. However, much more needs to be done. Much more could be done 
and this Budget contains a comprehensive and varied program for resource development.

Mr. Speaker, I would not like to outline some of the major funding initiatives in the area of 
resource development proposed for the coming year.

Fisheries
For the past several years the fishing industry has been one of the most vibrant sectors of the 
Province’s economy, with the landed and export value of seafood products reaching record 
levels.

There is little doubt that the industry is now characterized by great employment: stability and 
that the rural economy of our Province has benefited immeasurably from a revitalized 
fisheries sector. This revitalization is reflected by increased private sector investment within 
the harvesting and processing sectors of the industry.

Government's ongoing commitment to this critically important resource sector will be 
reflected in increased expenditure activity in a number of areas. Gross expenditures for the 
Department of Fisheries in the coming year I will be $41.3 million. In addition, program 
initiatives relating to the harvesting and processing technology, market development, 
aquaculture and onshore infrastructure the will be expanded, particularly within the context of 
the recently signed $60 million Inshore Fisheries Development government.

This five-year Federal-Provincial agreement will be periodically strengthening the inshore 
fishery and represents the largest: cost-shared commitment negotiated to date for this sector of 
the fishing industry.

Over the past year Government has directed special attention to the needs of inshore 
fishermen and has examined a number of restructuring options to further strengthen the 
:inshore sector. Government is now addressing a debt restructuring option for inshore 
fishermen and an announcement on' this special initiative wi1l be made shortly.

Government’s decision to participate in the restructuring of the deep sea fishery contributed 
greatly 1-.0 the revitalization of the offshore fishery and year equally confident that debt 
restructuring initiatives will further strengthen the inshore fishery. Capital funding of $2.7 
million has been provided for fishermen’s facilities/services at various locations across the 
Province with funding for some of the major projects allocated as follows:

Funding of $8110,300 has been allocated for various fish some facilities $250,000 for 
fisheries access roads; $100,000 for extension of electrical services; and $350,000 for various 
community projects in order to assist in obtaining Federal funding under programs such as 
Canada Works.

Mr. Speaker, in total, fisheries facilities/services expenditures will be increased by a sizeable 
34.8 percent to $15 million. At the same time fisheries industries support services will be 
allocated $6.2 million representing a 63% percent increase. In addition, fisheries	loans and 
assistance, direct funding, will climb to $16 million, an increase of under 5 percent. This 
clearly shows the commitment of this Government the industry that has the greatest social 
manner cultural impact on our society.

In 1988-89 the fisheries Loan Board is forecasting that it will support in excess of $30 million 
investment in rental and rebuilt fishing boats and equipment for over 1,000 fishermen. under 
the $50,000-and-under direct loan program, close to $10 million will be provided to a further 
1,000 applicants :in direct loan and bounty funding for small boats and equipment.

As well, the Bank Loan Guarantee Program is expected to generate an investment of over $20 
million for close to new and rebuilt larger vessels. The Board will provide directly only 
support to this program and subsidize interest cost on the approved loans to a rate of three 
percent below	prime. The level of activity and support for this program will influence will 
benefit not only the fisherman but wi1l give a major boost to our economy.

Mr. Speaker, Government continues to place high emphasis on the development of our rural 
economy. Government is p1eased by the economic activity which has been created by the 
expansion of the Rural Development Authority Incentive Loans Program to provide assistance 
to service sector firms in our Province. More than 150 service sector firms have been assisted 
creating an estimated 234 new jobs through this initiative. This is consistent with our policy 
of revitalized support to entrepreneurship and small business development in our Province in 
1988.-.89 will be providing $6.5 million to the Rural Development Authority to continue our 
support to all small business sectors in the province Total allocations for rural development 
programs will be increased by 11.5 percent 	and $14.6 million earmarked for this year.

The agriculture industry plays a significant role in the economy of rural Newfoundland. In 
1987, farm cash receipts for the Province are initiated at $175 million, an increase of 3.5 
percent from the previous year compared to 2.3 percent for Canada. The livestock and poultry 
sector accounts for more than 85 percent of this total with this sector has experienced 
significant growth over the past decade, a major factor affecting these producers is the cost of 
imported feed.

To help alleviate this problem, the Province and the Government of Canada signed a Canada-
Newfoundland Subsidiary Agreement on a livestock Feed Initiative little over one year ago. 
The objective of the agreement is to promote the growth of a viable agri-food industry by 
increasing in quantity and quality of livestock feed produced in our Province the	agriculture 
extends to 1991 and earmarks $4.8 million our the four while the overall benefits of an 
agreement of this nature cannot be felt after only one year uncouthly the assistance provided 
farmers for land improvement and so forth will go a long way towards reducing this 
Province's dependence on imported forage in the future. While the Agreement provides funds 
for an important sector of the industry, a multi-sectoral Federal-Provincial agreement is 
essential to further the development of the agricultural industry. Government is currently 
negotiating with federal officials on this issue and expects an agreement to be signed in the 
new fiscal year.

To further demonstrate our commitment to I he agriculture industry J an amount of $3 million 
has been allocated to the Farm Development Loan Board for this year. I’m total 19.3 percent 
in increase in funding for development of the agricultural industry with $21 million being 
allocated for this year.

It is envisaged that as the Newfoundland Enviroponics Limited facility comes into full 
production, significant increases in the production of fresh loca1 vegetables will decrease 
imports in this area and will provide a much superior product to the 10 caI market. With a 
projected full staff complement of 150 persons this facility represents by far the largest 
agricultural complex in our Province and will increase to the contribution of the agricultural 
industry 1::0 our economy significantly.

The Mokami Project Group, which was originally founded to encourage informed debate 
relating to docile optimistic in Labrador, has four proponent groups. They are: the Labrador 
North Chamber of Commerce, the Town of Happy Valley Goose Ray, the Mokami Regional 
Development Association and the Public Service Alliance of Canada. The Group’s mandate is 
to promote the economic, social and physical development of the region for the optimal 
benefit of its residents. Proposed research projects include the identification and assessment of 
specific employment and business opportunities that will be created as a result of military 
expansion, as will as an indication of major constraints to the realization of these 
opportunities. Government is pleased to include an amount of $100,000 for the activities of 
this Group in 1988-89.

Funding has been provided for two native translators to undertake the translation of various 
regulations and programs into native languages, an initiative which is of prime importance in 
Labrador. This need the housing programs administered in Labrador by the Newfoundland 
and Labrador Housing Corporation. Because regulations in English only, native people were 
at the disadvantage. These translators will also be able to work with the Department-.during 
the negotiations and implementation of present and future Native Peoples I Agreements.

The Combined Councils or Labrador is the equivalent of the Federation of municipalities on 
the Island portion of the Province and includes approximately 30 communities. It deals with 
issues on a community and regional bas and meets once a year to discuss various issues and to 
resolve any difficulties. In order to adequately pursue the objectives and goals of its member 
organizations, which have a very low tax base, this group requires additional finding to help 
defray the burdening costs of administration and communications, and I am pleased to 
announce that the Budget contain an amount of $15,000 for the Combined Councils of 
Labrador.

Development and Tourism In 1987, the Subsidiary Agreement for Tourism infused $1.2 
million of Provincial funds and $2.3 million of in support of tourism initiatives. These funds 
leveraged an additional $6.1 million of private sector expenditures in support of the tourism 
industry. More and more, accommodations, attractions and tour services are making the 
Province attractive to tourists and both Newfoundland and Labrador are receiving significant 
interest as destinations, particularly by Nova Scotia and other mainland Canada residents.

Bus tour traffic to the Province increased in 1987 over 1986 by 40 percent accounting for 
approximately 6,000 visitors. That number of non-residents visiting our Province 'in '1987 
reached 295,000, an increase of ten percent over 1.986. The increase for other than business 
related reasons growth by in impressive 1.6.8 percent. Resident travel 'in the Province grew 
by 10.4- percent over 1986 and expenditures by residents are estimated to be in excess of 
$230 million.

provincial initiative in advertising represented by a budget in 1987 of $1.5 million reaching 
the Province's marketplaces in mainland Canada, eastern United States and to a lesser 
degree?, Europe, has created an awareness of Newfoundland as an destination of impressive 
magnitude. Enquiries in 1987 great by some 60 percents or in excess of 80,000 individual 
requests for information.

In addition to direct advertising, Government will continue to be involved in an extensive 
program of participation at travel trade expositions and other tourism promotions in the major 
target markets of the northeastern United States, Ontario and the Maritimes. This will involve 
participation at travel marketplaces, bus tour promotions, an extensive program of 
Familiarization tours for travel agents, travel wholesalers and travel journalism and 
participation at major sports hunting and fishing expositions, the promotion of cruise ship 
traffic, and many Other marketing initiatives designed to raise the general profile of the 
Province as a desirable and unique vacation destination in North America.

The tourism industry provides major opportunities for employment, and some 10,000 jobs are 
now associated with this segment of the economy. Government’ s efforts to promote this 
important industry will continue, as demonstrated by the recent establishment of the Marble 
Mountain Development Corporation which will work towards creating an all-season resort in 
the Corner Brook area. As been, establishment of bus and rail tours into eastern Labrador and 
other similar initiatives encompassing everything sightseeing and touring to fishing. Find 
hunting expeditions will continue through Government participation.

The Provincial tourism industry has benefited greatly from the introduction of capital 
assistance programs under the Canada-Newfoundland Tourism Development Subsidiary 
Agreement and this year that level of support will continue. The Provincial' component of 
funding under the Agreement for accommodation development wi11 total $'750,000 next 
year. For tourism facilities development, $100,000 has been budgeted and travel generators 
will have $650,000 available this year for their ongoing development. This funding -is -in 
place and will be made available over the course of the year to applicants from all over the 
Province will have sound business proposals that meet the various criteria under the science 
programs .

The business community has responded every favourably to this type of funding since the 
Tourism Agreement was concluded in 1984. The projects approved to have been very 
beneficial to the development of a quality tourism plan in this Province. Given the past level 
of interest on the part of the private sector, we expect a full complement of proposals for 
evaluation under these programs this year. Overall, expenditures on development of the 
tourism industry will be increased by 27.3 percent to an impressive total of $7 millions. 
Government will content to support, through the Ocean Industry Development Subsidiary 
Agreement, local initiatives aired at participating compared is to take full advantage of the 
opportunities as social will our oil and gas and fisheries resources. This support available in 
the form of capital incentives, market and product development incentives, and assistance for 
technological transfer and innovation. Similar support will also be available for our tourism 
sector. During the past year, in excess of $8.5 million in grants approved for small businesses 
in tourism. In total, funding for offshort and industries expenditures will be increased by 3,3 
percent to $13.8 million, while support for small business technology will be substantially 
increased to $21.9 .million representing a 92.1 percent increase over 1987-88.

Government continues to be very pleased at the high level of activity at the Marystown 
Shipyard, which, in great, part, is due to the Yard I s involvement in the fleet replacement 
program being carried out by Fishery Products International. Marystown's selection as the 
prime contractor for this eight vessel program was made possible by the active and positive 
intervention of Government which undertook to provide a $10,5 million subsidy to the Yard 
which was matched by the government of Canada. This allowed Marystown’s bid to be 
competitive with the heavily subsidized foreign yards who were actively seeking the work. To 
addition, Government directed the construction of two middle distance vessels to Marystown 
Shipyard both of which were built during 1987 and which are now proving to be highly 
successful.

On the repair side, Marystown Shipyard was the successful bidder on two large Federal 
contracts on the Coast Guard Vessels Alert and Simcoe together costing approximately $13 
million.

Marystown Shipyard is actively seeking a role for itself in future National Defense projects 
such as mine sweepers and other small vessels, and expend: this initiative to pay dividends 
down the road. In addition, the Shipyard with strong assistance from this government, is 
pursuing potential work in additional consideration as will as for production-related work on 
offshore oil projects. All in all, the Shipyard expects to maintain its workforce above its 
current level of 500 during 1988.

The international economy is now characterized by rapid technological advances. Production 
methods, materials and services provided are undergoing constant change, to order to compete 
in an international market, Newfoundland businesses will have to maintain a constant 
6\bJar'eness of the latest scientific developments. As a Province, we must keep abreast of 
worldwide advances in science and technology and our scientific community with the 
resources to acquiring apply technological advances to our products and production methods 
utilizing the Canada-Newfoundland Offshore Development Fund, major investments have 
been made to upgrade our research and development capabilities at Memorial University and 
the Institute of Fisheries and Marine Technology.

Just recently, the Premier announced the appointment of a Newfoundland and Labrador 
Science and Technology Advisory Council to provide an independent source of advice in this 
important area. Last year. Newfoundland hosted a national meeting of Science and 
Technology Ministers which was succession bringing a national focus on the capabilities of 
this Province in Marine Sciences and Cold Ocean Technology. We are pleased with the 
Government of Canada is recent announcement on the development of networks of Centres of 
Excellence in Science Technology, and we will be working closely without scientific 
community to ensure that the Province plays a major role in this important initiative. To the 
corning year, Government will continue its strong support of research and development 
spending in this Province through a $5 million Research and Development Program 
administered by the department of Development and Tourism, as well is continuing 
investment in projects which have already been announced under this Canada-Newfoundland 
Offshore Development Fund. than ever before, Newfoundland and Labrador can truly claim 
to be a world class Centre of Excellence "in Marine Sciences and Cold Ocean Technology.

The recent Speech from the Throne highlighted the strong performance of the forest industry 
in 1987. New sprint prices were at record highs, and production levels and quality continue to 
increase as a result of the Government-assisted modernization programs at the Grand Falls 
and Corner Brook mills. What has been less obvious, but equally important, is the tremendous 
improvement being made in the management and revitalization of the forest itself. Indeed, 
overall funding for forest resource management will be increased by 6.7 percent over last year 
to $31.8 million. We are now in the third year of a $48 million four-year forest Resource 
Development Agreement. Previous agreements had provided $36 million. Much of this has 
been spent in growing and planting seedlings, and in such other silvicultural treatments as 
thinning and site reclamation. In 1988 we will treat 20,000 hectares of forest land in one form 
or another. Twelve million build be planted as part of this program this year.

It is evident that the mil1ions of dollars of investment in forests for the future must be other 
threats.	We all remember a record dry with nearly 300 fire starts, to a minimum mainly 
because of a strategically-stationed and strengthened water bomber fleet of eight planes I 
comprised of six Cansos and two CL-21Ss. Government has recently received an additional 
two CL-21Ss, completing its $15 million investment in the acquisition of new later bombers. 
Last year's success has convinced us that a function strengthening of the fleet is warranted and 
accordingly we have made provision to operating eight aircraft this year, four Cansos and four 
CL-215s. Further provision has been made for a medium-sized he to be located in Grand Falls 
to provide a fast response service.

Government is confident that the increased level of protection will more than justify the 
expenditures involve provision of $ 2 million has also been made in this Budget for 
continuing the hemlock looper, particularly on their great North I’m Where the infestation is 
heaviest. As a result of successful experimental work last year, the biological insecticide BT 
will form an increased proportion of this year's program.

	0 HI H t'	pat' i.. S	0f I' h f:1	f () t' est.
industry are providing employment and income hundreds of Newfoundlanders and 
Labradorians. The plywood industry is expanding. Our lumber industry has had a good year, 
and export pulpwood has provided at least ISO jobs on the Island and 'in Labrador and will do 
so again in 1988. Mr. Speaker, capital funding of over $27 million is provided relative to the 
construction of and alterations to various public buildings throughout the Province. Apart 
from those I have already outlined, funding has also been allocated for the ongoing 
construction of the new Motor Vehicle Registration and Office Building in Mount. Pearl ($4.3 
million); alterations of Confederation Rulling East Block ($6.7 million); the construction of 
deposal Anthony ($305,000) and FlotAier's COVE'! ($350,000); find construction and 
renovations applicable to various Labrador depot facilities under the Native Peoples' 
Agreement ($1 million) area of transportation, the highlights of to which as follows:

An allocation of $40 million has been provided for our highway construction program to 
continue upgrading remaining gravel roads throughout, the Province continue our paving 
program will be released shortly by my Colleague, the Minister of Transportation.

An amount of $9.5 million has been allocated Under the Canada-Newfoundland Highways 
Agreement for the continued construction of the Trans-Labrador Highway Between Western 
Labrador and Churchill Falls, and to complete the upgrading of the road between Pinware and 
Red Bay in southern Labrador. At the end of the 1988 construction season, Mr. Speaker, 138 
kilometres of the total length of 200 kilometers western Labrador and Churchi11 Falls here be 
completed With the completion of the upgrading this year and, hopefully, the paving in 
another year of the Bay Road, the Basque Whaling Station out is attraction at Red Bay will be 
more readily accessible to tourists.

The provision of modern, efficient transportation facilities must always be a major priority of 
Government. Without such facilities, progress and development throughout the Province will 
no take place. The 1988-89 Budget contains significant Expenditures in the

An amount of $25.4 million has also been allocated under the Canada-Newfoundland 
Highways Agreement for continued improvements to the Trans Canada Highway across the 
Island portion of our Province. This Year will see the construction of two additional lanes on 
the Highway from the Foxtrap access road area to Bitterpot Provincial Park. A start will be 
made this year and work IA61l continue into the next two years on the total upgrading and 
repaving of 28 kilometres behind Clarenville and Port Blandford and the 40 kilometres 
between Gambo and Gander, including a grade separation at Gambo, On the I/Jest coast, work 
this summer will complete the upgrading and repaving of a section of 'the Trans Canada 
Highway near Georges Lake. This work will complete improvements on the 148 kilometres of 
the Trans Canada highway Corner Brook and North Branch bringing this section up to the 
new standards. The other project funded under this Agreement will see the continuation of the 
new 12 kilometres access road in Port aux Basques to provide direct and fast access to and 
from the Marine Atlantic ferry terminals. Mr. Speaker, any motorist using our Trans Canada 
Highway in recent years has to be impressed with the improvements made through the 
addition of passing lanes whi.ch have greatly improved the safety record of this highway and 
facilitated the easier passing of larger vehicles.

Funding of 7 million from the Government of Canada has been included For construction of a 
new airstrip Will Harbour and the restoration and maintenance of various airstrips in other 
coastal Labrador communities. In addition, funding of $3.8 mi11ion has been provided for the 
construction of airstrips in the Clarenville, Grand Falls and Codroy Valley areas under a new 
agreement with the Government of Canada.

Consistent with our continuing efforts to improve service and efficiency in our ferry service 
operations, Government. has decided to intergrate the Fogo and Change Islands ferry services. 
This change will provide better service to the residences in that area.

Mr. Speaker, in total the of transformation be involved in a construction program at $88 
million as compared to $82 million last year, for an increase of 7.3 percent. This alone will be 
a tremendous boost he construction 'industry and wi1] provide some 1,500 jobs to that sector 
of the economy.

Government continues to make good sense of the $300 million Canada-Newfoundland 
Offshore Development. Fund which is cost-shared 75 percent Federal and 25 percent 
provincial. The Province’s broad strategy for use of the Fund is to assign priority to projects 
which are designed to give major long-term economic benefits to the Province. Projects valled 
over $10 million were recently approved. In total, over 20 important projects valued at $123.5 
million have been approved of approved in principle.
Recently approved projects –include 
$3.5 million for a Wave Generator at the Institute for Marine Dynamics;
$4.2 million for a Super Flight Simulation Centre;
$500,000 for the Technology Advisory Council
$500, 000 to the Canada-Newfoundland Offshore Development. Fund Committee for 
Administrative Support;
$870,000 for Concrete Floating Production System Studies; and
$219,000 for the development of a Two-Phase Flow Meter Prototype. 

Government continues to initiate many projects to encourage more efficient use of energy, 
and conversion to economies alternative energy sources. Our objective is to identify viable 
energy projects, access the costs and expected sayings, and assist in bringing economic 
projects to. It has been demonstrated that with adequate assessment and planning, significant 
energy cost savings can be retrofitting and/or converting to wood fuel.

Wood chips are an economic alternative fuel where wood supplies are available. The 
Newfoundland Hardwoods Plant in Clarenville and James Paton Memorial Hospital in Gander 
converted to wood chips a few years ago and are Very successful operations. Two other 
hospitals, Western Memorial Regional Hospital and the Central Newfoundland

Regional health Care Centre, are converting to food chips this Year with support from the 
Department of Energy and Health. It is interesting to note that in another alternative energy 
project, a small hydro plant built by a commercial at Mary's Harbour, commenced operating 
in 1987. In addition, school boards are taking advantage of assistance offered by the 
Department of Energy in an effort to r'educC::1 energy costs and free up funds for educational 
activities.

Mr. Speaker, 1988 will SE'E renewed efforts and renewed determination towards resolving 
the inequitable Churchill Falls contract. No longer can Newfoundlanders and Labradorians be 
denied fair economic rent from this great resource and from the tremendous potential of the 
lower Churchill and other of Labrador which flow untapped to we have determined that the 
inequities of the past can and must be converted to the opportunities of the future.

Mr. Speaker, 1987 was a Year of further' growing success for Newfoundland and Labrador 
Hydro and its affiliated companies and 1988 is shaping up as an excellent year' as that earlier 
it was announced that there would not need to be an increase in electricity rates in 1988 as 
previously envisaged. I am extremely pleased to announce t () day t. hat the r e will be are bat 
e of approximately $1.3 million to retail customers in 1988, resulting in a slight decrease in 
rates.

In addition to sound Financial performances, Newfoundland and Labrador Hydro is also 
undertaking a significant capital program in 1988, totaling over $120 million. Thesis more 
than double the level of capital spending in 1987 and will result in about 800 construction 
jobs during this summer and fall. This wi.11 be a significant boost to the overall economy.

The capital spending by Newfoundland and Labrador Hydro will be spread over virtually the 
entire Province. The major projects being undertaken include: a five megawatt wood chip 
generating plant in Roddickton costing $25.5 million; the Paradise hydro project costing $23 
million; the interconnection of Fogo/Change Islands costing $13 million; the upgrading 
Hollywood costing $20 million; and a new energy control centre/head office facility in 8t. 
John IS costing $40 million. Work on many of these projects will extend beyond 1988.

Mr .Speaker', Government has once again faced the chaI1enges of putting forth a fair and 
responsible financial plan, a plan which will guide our efforts in delivering a bright future to 
the whole Province, the task has not been as easy one, but I believe tale have succeeded 
admirably. The demands are many, there is much life want. To do, but our financial resources 
are limited. This does not mean we will not accomplish our goals, just that it may take a little 
longer to realize than we goals are clear, our course is set. Thesis not d government this will 
waiver to satisfy the ebb and flow of short term expediency. This is a Government wich a 
vision of the future for this Province and we have consistency moved to make that vision a 
reality. We brought this Province soundly through the trying years of recession in the early 
1980s. Our economic policies have helped this Province to enjoy one of its most prosperous 
years in 1987. The confidence shown by Newfoundlanders in personal spending, increased 
employment and business investment is ample evidence that we are building a future that will 
be a proud legacy for our' children. All our indications today are that the fiscal Year' see our 
Economy remain buoyant. Mr speaker continued progressing job creation, improving public 
services and enhancing economic development, while at the same t--.ilnl':1 r' including our' 
deficit and actually decreasing the overall tax effort through tax reform.

This is the record of the Peckford Government a record of tireless determination. Tireless 
determination to see the development of our offshore resources, tireless determination to 
enhance employment opportunities and business incentives in all regions of the Province, 
tireless determination to provide sound and responsible fiscal. Management to Government 
and the economy, a duty entrusted to thinking people of this province tireless determination to 
improve the quality and enjoyment of life of poverty Newfoundland Mr and Labradorian, no 
matter there his or her'rl':1S,"idl':1nCp. No matter that his or her skills and abilities no matter 
what dreams and aspirations.

Challenges still lie ahead of us. But we will be working over the coming year which the 
Federal Government, our sister provinces, and individuals, organizations and businesses all 
over this Province to meet these challenges all Newfoundlanders and Labradorians to join 
with us in meeting these challenges.

This is a province of immense opportunity. For so long we have been on the very gap of 
seizing our destiny and realizing our potential is my hope with the Budget we have put 
forward today we have moved one step fulfilling our vision and that the year will provide the 
evidence that we can search a life in this Province, for future generations, of which we can all 
be justly proud.