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HALIFAX, FRIDAY, APRIL 11, 2003

SUBCOMMITTEE OF THE WHOLE HOUSE ON SUPPLY

9:20 A.M.

CHAIRMAN

Mr. David Hendsbee

MR. CHAIRMAN: It is now Friday, April 11^th. So far we have 12 hours in debate on the estimates. Starting on day four we had 30 minutes remaining in the NDP time. I understand that the member for Sackville-Cobequid, Mr. Holm, would like to start off with a few questions before we pass the remainder of his time to the member for Halifax Chebucto, Mr. Epstein. So if you wish to continue, your time is now 9:20 a.m.

The honourable member for Sackville-Cobequid.

MR. JOHN HOLM: Just a few questions in one of the areas of the minister's responsibility and that is the Liquor Corporation. I just have a few questions, as much as I guess I'm looking for some information, data type of things and a couple of general questions. First of all I noted that a few weeks ago there was a report that there is going to be relaxations on microbreweries and the importing of products into the Liquor Corporation that can be sold whenever they open up the speciality stores and possibly also in the liquor stores. I'm wondering if the minister knows how many microbreweries there currently are in Nova Scotia and approximately how many jobs would be in those various microbreweries?

MR. CHAIRMAN: The honourable Minister of Environment and Labour.

HON. RONALD RUSSELL: There are seven microbreweries, and do you want to know the number of employees?

MR. HOLM: Please, the approximate number of employees.

MR. RUSSELL: I don't know, all I can give you is a guess. It would be somewhere just over 100 I would imagine. The number of people employed in the majority of the microbreweries runs about 20, but that is just a . . .

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MR. HOLM: A guesstimate.

MR. RUSSELL: Yes.

MR. HOLM: And certainly the Liquor Corporation has had no difficulty with those microbreweries, and they're very supportive of the employment and the quality of the products they're delivering?

MR. RUSSELL: It's very similar to the farm wineries. I mean it's a niche market and the microbreweries are filling a need and are doing very, very well.

MR. HOLM: I'm pleased to hear that and that they are supported, and you know from having consumed a few of the products that are made at those, they sit quite well with my palate. But that having been said, I'm just wondering now that the commission is going to be permitting the importation of microbrewery products and those are going to be sold in some of the liquor stores and also in the speciality shops - has any kind of a study been done to determine what impact that might have on Nova Scotia's own microbreweries?

MR. RUSSELL: To the best of my knowledge there hasn't been, but however (Interruptions) No, there has not been.

MR. HOLM: So we have no knowledge or idea of what kind of a negative impact that will have on Nova Scotia's own microbreweries?

MR. RUSSELL: Well I can tell you from experience that the importation of beer or wine products in competition with local products has never ever really been a problem. I remember many years ago - and the honourable member will remember this as well - when we had two major breweries in the HRM area and there was much opposition at that time to bringing in beer and other types of products similar to beer from provinces outside of Nova Scotia, and in fact when we did do it there was no impact on the local market whatsoever.

MR. HOLM: Of course here we were talking about a niche market and the niche market for a microbrewery type of products is not endless and I'm just puzzled by the fact that there was no kind of analysis done to see if that could have a negative impact on the industry here in Nova Scotia.

MR. RUSSELL: As Greg has just pointed out to me, there are a number of advantages that we offer to the local industry in that we give them signage and that kind of thing to identify them as being Nova Scotia products, and of course as the honourable member is aware the government is very, very much interested in growing the market for Nova Scotia products, and that would include the products from small breweries. There's another point too, I think, in that I'm not too sure whether or not we can indeed deny them the market here without affecting our markets in other areas of Canada.

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MR. HOLM: Were Nova Scotia microbreweries consulted before the decision was made?

MR. RUSSELL: I don't believe so.

MR. HOLM: Okay, got my answers on that one. Next, if I could, in terms of the number of employees who work for the Liquor Corporation, do you have those numbers?

MR. RUSSELL: Yes, we do, I'm sure - just one moment.

MR. HOLM: I'm interested in the number of full-time, the number of permanent part-time, and the number of casuals.

MR. RUSSELL: I can give you them all and, in fact, I will give you a copy of this sheet if you wish when we're finished with it. Mr. Chairman, I will make it available to everybody. Regular full-time is 495 employees, plus 41 on long-term disability, that's for a total of 536; regular part-time, 104; and casual, 646; which comes to a grand total of 1,245 plus 41, as I had mentioned before, on long-term disability.

MR. HOLM: Okay, so we have really in effect, as you say, about 536 permanent full-time employees, including the others.

MR. RUSSELL: Yes.

MR. HOLM: Those who are permanent part-time, 104 - and maybe I will ask you this question first, have there been new people hired into the permanent full-time positions over the last year?

MR. RUSSELL: In the stores?

MR. HOLM: Pardon me?

MR. RUSSELL: In the stores? Are you speaking about management or are you just speaking about . . .

MR. HOLM: No, I'm speaking about in the stores.

MR. RUSSELL: In the stores.

MR. HOLM: Yes.

MR. RUSSELL: Yes, there has been.

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MR. HOLM: Would those people have come from the permanent part-time?

MR. RUSSELL: I would imagine; in fact I'm being told yes. That is the progression that we've had in the Nova Scotia Liquor Corporation and its predecessor, the Nova Scotia Liquor Commission, for many years now.

MR. HOLM: Which moves me right down to really where I wanted to go and that is the number of casuals, which is by far the vast majority of those who don't receive the benefits and so on, being casual employees. My question is how many of the casuals, those who are in the casual positions, have actually been moved into one of the various full-time positions?

MR. RUSSELL: There are a number, and it would be less than 50. We can get you the exact number . . .

MR. HOLM: Now we've got 646 who are casual. Certainly those people, I would assume, if they've been kept on, are considered to be very capable and qualified individuals for work . . .

MR. RUSSELL: Absolutely.

MR. HOLM: So my question is really a policy one. Is it the policy of the Liquor Corporation then that if they are going to be hiring into one of the full-time positions . . .

MR. RUSSELL: Or part-time.

MR. HOLM: Either full- or part-time permanent . . .

MR. RUSSELL: Yes.

MR. HOLM: . . . are those people hired as a matter of policy from the list of casuals?

MR. RUSSELL: Not by policy, but by practice, and I think that's generally obtainable right across the province. But there are some areas of the province, I know, where perhaps it's difficult to get casuals, and when I say it's difficult to get casuals because of the fact that you need casuals who are available all the time, and if you have the small store sometimes it's difficult to work up a casual roster.

MR. HOLM: Wouldn't it seem to be fair to offer the employment opportunities for a permanent job to the casuals first?

MR. RUSSELL: Yes, yes, and that's done.

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MR. HOLM: That is done?

MR. RUSSELL: Yes.

MR. HOLM: And so you've had no difficulties and no concerns from the casuals who would like to get a permanent job and haven't been able to do so because of others who are outside are hired over them?

MR. RUSSELL: No, no, that's not so.

MR. HOLM: I will pass that on. The next item I'm referring to is the speciality stores. None have opened yet?

MR. RUSSELL: The one in Dartmouth on Portland Street, which may be of some interest, is going to be opened in the next two weeks, and I understand - I know I'm interested - the one down on Bishop's Landing is about six weeks away.

[9:30 a.m.]

MR. HOLM: How long has Mr. Baker been head now? When is the one-year . . .

MR. RUSSELL: It's Barker.

MR. HOLM: Mr. Barker, I'm sorry.

MR. RUSSELL: One year.

MR. HOLM: One year, I'm just curious because I think that part of the contract was that there is to be a $5,000 bonus at the end of the first year of the speciality stores getting up and running, I was just wondering if that bonus is going to be paid out.

MR. RUSSELL: I'm advised that the board is performing a performance rating right now and that that decision will be made very shortly.

MR. HOLM: And the other bonus I think, and going by memory, was about $20,000 and that will be part of the same performance or evaluation?

MR. RUSSELL: Yes, all bonuses are part of the evaluation process.

MR. HOLM: And now that the contract - really the first year is up - in terms of subsequent years, is that going to be strictly salary based or is that going to have a bonus compartment built in as well - or a component I should say?

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MR. RUSSELL: I can't answer that. As I say, that's a board decision, but it is likely that that's what will occur.

MR. HOLM: They will continue with a bonus section, okay. Now, I'm going to be heading out, I've already taken up as much time as I said I was going to do. So I will just leave it at that.

MR. CHAIRMAN: The honourable member for Halifax Chebucto.

MR. HOWARD EPSTEIN: I would like to move back now to the Department of Environment, if I may, Mr. Minister. When we left off yesterday, I was emphasizing to you, I think, how important it was that we not find ourselves in a position akin to that that the Province of Ontario found itself in with respect to drinking water and the Town of Walkerton. I think I just want to remind you, and the members of your department who are here, that should we ever find ourselves in a position of having deaths or serious illnesses arising from water contamination - and I'm speaking here primarily about, I think really the danger is more with respect to well water than it is to municipal water supplies, because I don't think we have the same kind of problems that the municipal water supply system had in Walkerton - I think that if we ever were in that position, it wouldn't be adequate for the department to have indicated that it left the matter to voluntary compliance through guidelines.

I want to encourage the minister to think very seriously about talking with his colleague, the Minister of Agriculture, about replacing guidelines with regulations. The situation across Canada is that other provinces do have outright regulations with respect to the number of farm animals, manure management, setbacks, and associated kind of rules. So far as I know, the Province of Alberta has pretty well the most comprehensive set of regulations in place and I would encourage the minister to take up with his colleague the possibility of doing that here. As I reminded him yesterday - or drew to his attention - the Federation of Agriculture did say to a committee of the Legislature, the Resources Committee, just two, maybe three weeks ago at the most, that there is not universal compliance with the guidelines. They're certainly working towards it, advances have been made, but it isn't there yet and I think there really will be no excuse.

The parallel, one I'm sure the minister will be familiar with, as we all are, is in the problems that were encountered with oversight of the Westray Mine. Nova Scotia is not without serious precedent here when it comes to the issue of the strictness of regulatory oversight. So what I'm pointing out to the minister is that there's a parallel and that we ought not to ever find ourselves in a situation where we're examining, through a Royal Commission or any other kind of inquiry, injuries or deaths and find ourselves thinking about what we might have done in retrospect. It wouldn't, I think, go down well with anyone at that point. I think the precedents are there and we know the problem.

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I want to move on to another topic which, I think, along with the life-support system represented by water is equally important and this is the life-support system represented by air. The whole issue of how we proceed with the topic of implementing our Kyoto obligations is an important one and I heard the minister say, and I've read in various documents from his department an intention to be involved in the plans towards meeting the Kyoto obligations. I'm wondering if the minister can help us by bringing us up-to-date with where things stand in this regard.

As I've read what has emerged, there seems to be something of a slow interactive process between the provinces and the federal government on what exactly implementation is going to mean. There seems yet to be clear targets for emission reductions for our province; there seems not to be clear targets for individual large industries - and here I have in mind particularly our electricity generation sector, nor does there seem to be clear targets for the other sectors of our activities that are generators of greenhouse gases by which I primarily mean the transportation sector. So I'm wondering can the minister help me and the public understand just where we stand with respect to moving ahead with Kyoto?

MR. RUSSELL: Well we understand that is going to be the responsibility of the provinces to effect Kyoto and at the present time, as I understand it, if I can use the term "global" in respect to the province, we have targets for the province. We are working with the federal government to determine the governance for the larger emitters such as Nova Scotia Power. We're still in the early stages. I guess the member recognizes that in truth I have not been to a meeting of the Ministers of Environment since I've been given this portfolio. (Interruption) The deputy advises me that he has convened a meeting of the Atlantic deputy ministers and they met just a week ago and they will be dealing with their federal counterpart on international transporter - I'm trying to read my deputy's writing and my deputy's writing is very similar to mine.

MR. EPSTEIN: Would this be on emissions trading? (Laughter)

MR. RUSSELL: We're working with the federal government on governance for industry and large final emitters which would, of course, be Nova Scotia Power. It's very easy I suppose for us to say that we would like to have Nova Scotia Power come firmly onside and start doing something immediately, but I'm sure the honourable member understands that it's a much more difficult problem than that in that the major part of our generation at the present time is coal, and to switch from coal to another product is difficult; to burn coal completely cleanly is difficult. It is going to take time, but we are moving, and I can assure the member that it is our determination that we will move to do whatever we have to do in this province to accommodate the commitment made by the federal government.

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MR. EPSTEIN: Mr. Minister, a moment ago I think you opened your answer by saying that you thought implementing the Kyoto ultimately would be primarily a provincial responsibility. I was wondering if you could just help me understand how that would work. For example, in Alberta, I know they reacted to the signing of the Kyoto, or the ratification of Kyoto by the federal government rather negatively and one of the things they did was they brought in legislation in November in which essentially they declared that greenhouse gases were a provincial natural resource and essentially, as I understand it, trying to set up a situation in which they would be arguing with the federal government against direct federal regulation presumably on constitutional grounds on jurisdiction. Is it the plan of the Province of Nova Scotia to do something similar here?

MR. RUSSELL: As I said, originally the province - I'm treating the province globally - there are provincial targets and we are working with the federal government rather than antagonistically towards the federal government.

MR. EPSTEIN: I have to say that seems to be the better approach; I don't think constitutional litigation is going to help anyone over any of this.

MR. RUSSELL: Let's face it, we can't afford it.

MR. EPSTEIN: Well you may get the chance to be an intervener if Alberta goes ahead. I suppose it's a little less expensive being an intervener, but I'm certainly in sympathy with that. The problem here, I think, still, is timing. We are caught in a squeeze and it's important that we move ahead, and furthermore the opportunity to move ahead is there.

I think I was struck by something you said in your introductory remarks yesterday in which you said that there were many challenges that have no answers. I have to say that's not my experience. Thirty years into working with environmental issues, it has not been my experience that on environmental issues there are no scientific or technological answers. If anything, it seems to me that the barriers to change are not the absence of knowledge of better ways of doing things - be it in agriculture, energy, mining, fisheries, forestry - it's attachment to the status quo and unwillingness to change. It seems to me that that's the big opportunity you and your department have, to take known ways of doing things better and actually moving ahead with them. That seems to me just clearly the largest opportunity you have and why it is that your department could be such an important one for effecting serious transformation in our province, be it on water, be it on air, be it on energy, in any of those sectors.

[9:45 a.m.]

I would ask you if that's what you meant, if you meant that the answers are not known in a scientific or engineering or technological way, I think I would have to take issue with that. It's not that there's perfection of scientific knowledge or engineering, but we

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certainly do know how to do most things a lot better than we do them now. The problem, of course, is to move ahead in a way that accommodates all other interests in the province, and gain public acceptance and is sensible, and is something we can afford. I don't think those are barriers either. Did I understand your comment correctly, was it addressed to the absence of scientific or technological knowledge?

MR. RUSSELL: Exactly. At the present time we do not have the answer to exhaust emissions completely. As long as we use the internal combustion energy, I would suggest to you that we have this problem, and to solve that type of emission is going to require more technology, affordable technology.

MR. EPSTEIN: But we have buses. In a place like Halifax, it's not that we have to have a phase-out or a replacement for the internal combustion engine. What we can do in a place like metro is encourage more people to walk, bike, take the bus, or if it's a question of moving goods around, there are trains that were praised in the House so lavishly in terms of their position in Cape Breton yesterday. They are much more energy efficient, and cutting back is an alternative.

MR. RUSSELL: Agreed. However, at the present time we're faced with the fact that in many areas now we no longer even have the rail bed available.

MR. EPSTEIN: I understand that that has occurred, but we still have the main node, transportation node of Halifax as a port in which goods come in and are moved around. Reliance on trains rather than trucks, for example, would give an enormous energy advantage. I guess that's an example of what I meant by something that your department could be involved in trying to promote, that there's an opportunity there to move ahead that it doesn't have to be left purely to the private market. Indeed, if it's all truck traffic, we're left to pick up the cost of repairing the roads, which is an expensive item, as you will know from your experience as Transportation Minister. It's enormously expensive, and it's not clear that the revenues flow from gasoline taxes and other forms of revenues to allow us to do that so comfortably. It is very problematic.

Those are examples, I think, of items. Do I understand that Transportation and Public Works is not going to be part of what you hope to move ahead with when it comes to greenhouse gases? Is that sector just going to be left alone?

MR. RUSSELL: No, I'm not saying that at all. What I'm saying to you is that in my lifetime probably, and probably in your lifetime as well, that that problem is not going to be resolved. It's a problem that's going to rely on new technology or existing technology that is available that's going to have to come down dramatically in price to be acceptable and to provide us with the opportunity to maintain our economy.

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MR. EPSTEIN: Can I point out a fact to the minister, which is that World Health Organization studies of Europe and North America now point out to us that more people die from air pollution than are killed in highway accidents. That is a huge cost to us in society at large, and it's a huge cost to the province, which is the funder of the health care system, the tertiary aspect of it. I will leave you and your officials the article I have in mind. I think we're probably over our time. I think the Liberal caucus is probably interested in moving ahead with that. I will leave the article for you.

MR. CHAIRMAN: The time has now expired for the NDP caucus. It is now time for the Liberal caucus to ask some questions.

The honourable member for Cape Breton West. The time is 9:50 a.m.

MR. RUSSELL MACKINNON: Mr. Chairman, although I wasn't in the Chamber, I did have a chance to review most of the minister's comments that he made yesterday, and I do appreciate that. There's some good material. I'm going to direct myself right into detail on specific issues of concern that I believe will have some broader policy-type implications.

One of the issues is with regard to labour standards. I understand there's a considerable backlog for people who have complaints about their employment situations, whether it be for wrongful dismissal or whether it's that they didn't receive their proper severance package or vacation pays or whatever. I understand there's a significant backlog in the department. Could the minister apprise members of the committee as to what the status of the backlog is now, and how long does it take for someone to have their claim processed?

MR. RUSSELL: There is a considerable backlog at the present time, the honourable member is quite correct. It ranges from about four to six months, as I understand it. Ross Mitchell has retired, and the replacement officer who has come in is just getting up to speed, and she hopes to be more innovative perhaps than we've been in the past and to get that backlog down as rapidly as possible.

MR. MACKINNON: Can you give us a figure as to what the backlog is?

MR. RUSSELL: We don't have the number at hand, however, we will get that for you.

MR. MACKINNON: Another issue is the piece of legislation that was introduced for WCB benefits for volunteer firefighters. Can you give us a little more detail as to where the money for that is going to come from and what the government expects would be the total cost?

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MR. RUSSELL: Well, it applies to members of volunteer and full-time firefighters who are covered under workers' compensation, that's number one. They have to be a part of the plan so that they're paying in premiums the same as any other employee across the province who works for a firm that contributes to the workers' compensation fund.

MR. MACKINNON: If a volunteer firefighter is simply a volunteer firefighter, he's not earning an income as such. Would he receive a WCB benefit?

MR. RUSSELL: The municipalities are paying for volunteer firefighters. I forget exactly how many volunteer firefighters are presently covered, but it's a considerable number. About 2,500 are covered under workers' compensation at the present time.

MR. MACKINNON: So there are approximately 5,500 that are not covered.

MR. RUSSELL: So there's about another 3,000 who, at the present time, are not covered, but I would suspect that they will probably move into the system. Some of them are covered for long-term disability under private plans, for instance the HRM full-time firefighters, professional firefighters.

MR. MACKINNON: But for those whose municipalities don't pay into it, they are left out of the loop, if they don't have a medical plan.

MR. RUSSELL: If they don't apply for workers' compensation, they will be out of the loop, indeed. They have to be contributing to the fund to be eligible for benefits.

MR. MACKINNON: So the premise upon which this legislation would work is if each and every municipality pays into the workers' compensation system?

MR. RUSSELL: It wouldn't have to necessarily be the municipality.

MR. MACKINNON: Or the fire department.

MR. RUSSELL: Or the fire department, yes.

MR. MACKINNON: How would that work? If they're volunteer firefighters, do they assess a certain value that their volunteerism is worth? Let's say, well, we're going to peg you at $30,000 a year even though you're not paid $30,000, this is value we're going to put on it from a fire department's perspective so if anything happens we're paying our premiums based on the fact that you're receiving $30,000 even though you're not paid $30,000, or how is it going to work?

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MR. RUSSELL: It's worked on the average that is paid to the firefighters. The Workers' Compensation Board treats it as not only the recompense that the volunteer firefighter receives for being a volunteer firefighter but also takes into account their full-time job salary as well.

MR. MACKINNON: If they already have a full-time job, what you're saying if they were a volunteer firefighter hurt fighting a fire and they had compensation from their place of employment, you're saying that would cover?

MR. RUSSELL: That's correct.

MR. MACKINNON: Essentially what you're doing is imposing a bill on the private sector to pay compensation for employees who are not working on the job.

MR. RUSSELL: I can't follow your reasoning, I'm sorry.

MR. MACKINNON: If they're out doing volunteer work for the volunteer fire department, let's say they're out fighting a grass fire, and they happen to trip and break their ankle or whatever - for the sake of discussion - what you're saying is that because of that unique scheme that you're referring to, or set-up, that the workers' compensation benefits that they would normally, if they hurt themselves on the job, as a parallel, even though they didn't - okay, what you're saying is even if they didn't hurt themselves on the job, they're deemed to have been hurt on the job.

MR. RUSSELL: Correct, while actively fighting a fire.

MR. MACKINNON: So what you're saying is the private sector is now having to pay workers' compensation premiums for volunteer firefighters even though they're not at their place of employment, and they're hurt fighting a fire?

MR. RUSSELL: What I'm saying is that if Ron Russell, volunteer firefighter, works for ABC Corporation, and I run out and fight a fire and I'm covered at the ABC Corporation under workers' compensation, I go to the fire and I'm injured, I can claim against my workers' compensation benefits.

MR. MACKINNON: That's the point I'm making. What you're saying is you're legislating industry to pay for all volunteer firefighters in this province.

MR. RUSSELL: What I'm saying to you is that workers' compensation is already being paid the premium by either the fire department, by the municipality or by the employee.

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MR. MACKINNON: No, I'm speaking about the 3,000-plus volunteer firefighters who are working in volunteer fire departments who perhaps don't pay WCB premiums.

MR. RUSSELL: They're not covered.

MR. MACKINNON: So this bill only addresses . . .

MR. RUSSELL: This only addresses those on whose behalf premiums are paid to the workers' compensation fund, and they have the opportunity to join.

MR. MACKINNON: Yes, but if they're volunteer what that would mean is they have to now go out and do additional fundraising to pay for the premiums that they can't afford now anyway because many of them are struggling just to keep their departments alive.

MR. RUSSELL: I beg to differ. The deputy has just given me an explanation that may help. The municipality chooses an average earning rate and pays premiums based on that rate. The average earnings must be between the minimum, currently $10,200, and the maximum, $41,800. That's for 2003. That's for those who are covered by municipalities. There are others who are covered by their own individual fire departments. I know I have an individual fire department in my area which, I believe, pays their own workers' compensation premium. There are others, as I said, who are covered because of their normal workplace coverage. And there are others who are covered under a private system, which this does not apply to.

MR. MACKINNON: If that's the case, what's the purpose of the bill if they're already covered?

[10:00 a.m.]

MR. RUSSELL: There is no presumption at the present time for cancer. What this bill does is provide presumption for volunteer firefighters who receive cancers that are caused by the inhalation or the skin contact with various chemicals and other gases, et cetera, that occur during a fire.

MR. MACKINNON: But that's already an issue before the compensation board. They already receive that type of coverage based on the medical evidence.

MR. RUSSELL: Not with presumption.

MR. MACKINNON: So what you're saying is it's like automatic assumption with the coal miners.

MR. RUSSELL: It is similar.

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MR. MACKINNON: If you work in a coal mine for 20-plus years, if you have black lung disease then you automatically receive compensation. You don't even have to question the medical evidence or the cause-and-effect relationship.

MR. RUSSELL: It isn't exactly the same, but it's similar. What we're saying is that the nature of the work that firefighters do, whether volunteer or professional, are such that they have an above-the-norm opportunity to incur specific kinds of cancers.

MR. MACKINNON: Can you give us a little more detail? From my knowledge and experience there are some volunteer firefighters, not very many mind you, who have developed long-term illnesses and they had their workers' compensation through the local municipality - they're paid anyway. You're talking about the presumption in the bill here, but it really doesn't seem to give clarity.

MR. RUSSELL: The bill is the framework, the regulations are going to specify the cancers and the duration of the gestation period for that particular cancer.

MR. MACKINNON: So is this going to bypass the Functional Restoration Program?

MR. RUSSELL: The Functional Restoration Program.

MR. MACKINNON: Yes, as part of the compensation.

MR. RUSSELL: Not necessarily, no.

MR. MACKINNON: So then you're no further ahead at the end of the day, financially. If you have to go through the Functional Restoration Program, then you take in, let's say your pensions, your other sources of income . . .

MR. RUSSELL: This bill assists the firefighters in getting recognition of the injury and how it pertains to the work that they're doing.

MR. MACKINNON: I could be wrong on this, but I would submit that if you check with the experts at WCB that they will argue that that's already in place. I could see the benefit of it if you were bypassing the Functional Restoration Program because of the uniqueness of it, but if you're not, you're back to square one.

MR. RUSSELL: The Functional Restoration Program applies to chronic pain.

MR. MACKINNON: That's right. Well, what you're saying is that you're presuming that somebody has cancer because of working at a fire, without questioning any of the medical evidence, the cause-and-effect relationship, that's really what you're saying. Rather than going back and forth. I don't want to appear like I'm trying to browbeat or beat up on

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the issue. Maybe I can come back on a future day. We really need some clarity on this, because it seems to me like what you've suggested so far is that everything is in place.

MR. RUSSELL: No, it is not.

MR. MACKINNON: If it's not, then perhaps I could get an undertaking from the minister that he will give that clarity, because unless you were bypassing the Functional Restoration Program or you're making some type of a special provision because they're volunteer firefighters . . .

MR. RUSSELL: This applies to all firefighters, not just volunteers.

MR. MACKINNON: Well, if they're paid, they're automatically getting that anyway. I still haven't received clarity as to what this uniqueness is.

MR. RUSSELL: No, they're not.

MR. MACKINNON: When the whole thing was rolled out, essentially, as I understood, it was to provide workers' compensation coverage for many of those who don't have it now, and that's not the case. We have 300-plus volunteer fire departments in the province. Many of those can't afford to get coverage from their local municipality for workers' compensation premiums, and they can't afford to do it themselves. That was essentially the message, as I interpreted it, out to the public, and I fully support that. What you're suggesting is something built in to create a special exemption away from medical evidence to create a presumption that . . .

MR. RUSSELL: That's exactly it. The presumption is that if a person suffers from a cancer that is associated with the type of work that they're doing, then they would be entitled to benefits.

MR. MACKINNON: On the other hand, if he checks with the experts I think the minister will find that provision already there. If he's saying that it's not, then it would be nice to see that in writing.

Another issue I have is with regard to the various water systems within HRM, the lakes system. There is a growing concern that some of these lakes are becoming increasingly polluted. Does the department have any policy to deal with our water networks, our freshwater lakes within HRM?

MR. RUSSELL: Yes, we do monitor the systems for HRM to make sure that the water is safe.

[Page 228]

MR. MACKINNON: That wasn't my question. My question was, do you have a policy? You say you monitor, that's a little different than a policy.

MR. RUSSELL: Well, there are standards that we have, yes.

MR. MACKINNON: Do you have any profile of when one lake becomes polluted as to how it would impact on another lake?

MR. RUSSELL: I can't answer that question, but I will get the information for you.

MR. MACKINNON: I see your head of water resources is here with us. Does he have an answer?

MR. CHAIRMAN: For the attention of the audience while we are getting an answer prepared for the member here, I would just like to welcome our guests in the audience this morning. We are currently debating the estimates for the budget for the fiscal year 2003-04. Before us now is the Honourable Ronald Russell, Minister of Environment and Labour. We have an opportunity for members of the Opposition to ask questions of the various departmental budgets. Today, Mr. Russell is answering questions pertaining to his budget. I just wanted to explain the process of what we're doing here today.

MR. RUSSELL: Mr. Chairman, in answer to the question put by the honourable member, that's an HRM responsibility. We are responsible - at least, we do the monitoring on the overall quality of the water that comes out of the taps in the consumers' homes or the businesses that rely on the water system in the HRM.

MR. MACKINNON: Is that the case right across the province, every municipality is responsible for monitoring the water quality in freshwater lakes?

MR. RUSSELL: The only ones that we would deal with are the lakes that are used for drinking water and that supply municipal systems.

MR. MACKINNON: They're the ones that the province would be involved with?

MR. RUSSELL: We don't check the supply, we check what comes out of the taps for meeting the potable water standards that we have.

MR. MACKINNON: It would appear to me then that there's a big gap in your provincial water strategy. How can you have a provincial-wide water strategy if you don't even know the quality of the water in your freshwater resources?

MR. RUSSELL: Well, we do because we're checking the product that comes to the consumer.

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MR. MACKINNON: But not all people just drink the water, they swim in it. We have freshwater lakes. You go out to Grand Lake, Upper Grand Lake and Lower Grand Lake and Little Grand Lake, they don't necessarily drink it but they swim in it every day. That's impacted from . . .

MR. RUSSELL: The honourable member is talking about an area now which is really the responsibility of the Department of Health, and that is in areas where people use it for recreational purposes, swimming, et cetera. Those are checked.

MR. MACKINNON: That's my concern. That is a very intricate - I will table this for the minister. It appears he's not familiar with the map, so to speak, of how water flows within HRM. I will give you an example. Cranberry Lake, which I believe the member for Preston would be aware, has been identified as being polluted, the same as First Lake.

MR. CHAIRMAN: But they're not drinking water supplies.

MR. MACKINNON: No, that's right, and I'm glad he makes that point. Let's follow the flow chart, water flows downhill, so one lake feeds into another. Cranberry Lake feeds into Loon Lake, Loon Lake into Charles Lake, Charles Lake into Williams Lake, Williams Lake into Thomas Lake, Thomas Lake into Fletcher, Fletcher into Upper and Lower and Little Grand Lake. So the minister can start to see where I'm coming from.

MR. RUSSELL: I'm not familiar with that chain of lakes, however . . .

MR. MACKINNON: That's my concern. We have our director of water resources here, and there's a major vacuum within the Department of Environment and Labour as to how it monitors the quality of water in our freshwater lake supply. I will give you another example, and I will table this.

MR. CHAIRMAN: Yes, please table that. I'm also kind of curious about the hydrography, because I thought the way you described it, the water was moving away from the ocean, not that water usually flows to the ocean.

MR. MACKINNON: Well, I'm not a hydrologist, so that's why I was asking our expert. Maybe you have special knowledge, Mr. Chairman, I don't know. I will give you another example of a polluted lake, First Lake. Yourself, in your previous life as a counsellor, you would be familiar with this. First Lake flows into Rocky Lake, Rocky Lake into Powder Mill, Powder Mill back into Lake William, Lake William into Thomas, Thomas to Fletcher, and Fletcher ergo back to Grand Lake.

We have pollution from polluted lakes floating into good quality lakes. My concern is, we have a provincial water strategy and the department doesn't seem to have a grasp as to where the polluted waters are flowing in relation to the non-polluted waters. How can we

[Page 230]

say we have a good water strategy if we don't even have a measure of where the water is flowing to or from?

MR. RUSSELL: At the present time, we're establishing water quality objectives. I find it interesting, I believe we're talking about the HRM system, are we not?

MR. MACKINNON: No.

MR. RUSSELL: We're not?

MR. MACKINNON: No, this is not HRM material, if that's what you're referring to.

[10:15 a.m.]

MR. RUSSELL: This is not connected to the watershed for HRM, I take it.

MR. MACKINNON: No. This is just a natural water flow within our freshwater systems in the province. I specifically picked HRM because it represents one-third of the province. When you go, for example, to Grand Lake, there's a tremendous amount of upscale residential development there. I think people out there would be quite concerned if they felt that pollution was flowing from Cranberry Lake and First Lake into Grand Lake and not being monitored. That, to me, would be an issue of concern. Plus, if we have a provincial-wide water strategy - I believe the minister, your predecessor, when he made the announcement for the provincial water strategy, indicated that we were dealing with drinking water first, and then we will deal with groundwater later.

MR. RUSSELL: That's right, you're right on.

MR. MACKINNON: How can you deal with the drinking water unless you - most people get their water from groundwater, not just from surface water. Let's go on the premise that we're dealing with the surface water. I've just laid out the map of concern.

MR. RUSSELL: We are checking on what people are drinking, and that is our objective at the present time, that Nova Scotians have a good, safe water supply for drinking.

MR. MACKINNON: I don't doubt, given the checks and balances, by the time the water gets to the tap and we have it in our glasses that that's very much the case. Everything is backed up from there on. There's nothing until it gets into the chlorination system at HRM or wherever. Everything is out there. The vast part of this water strategy I would suggest would be vacuous without that type of footprint to be able to assist the government. I guess my question would be, does the minister have a footprint within the province similar to the footprint I've just supplied for other freshwater systems?

[Page 231]

MR. RUSSELL: We're working towards the objectives of a complete water strategy across the province. At the present time, as I said before, our objectives and our forces are directed towards drinking water, the potability of the supply that produces water at the tap. I'm sure the member realizes that there's been a tremendous improvement over the past little while. I know, for instance, the Town of Windsor and the Municipality of West Hants both had problems with their drinking water supplies, and both, through the infrastructure program of recent date, have upgraded their systems and their water supply now is not only safe year-round, but also the other discolourations and mineral content, et cetera, of the waters have been rectified. So we are moving in the right direction.

MR. MACKINNON: So the answer to my question is, you do not have a footprint similar to what I've provided there. The department does not have that type of footprint.

MR. RUSSELL: We are developing water quality standards. We're mapping all the watersheds in the province. That's currently underway.

MR. MACKINNON: So the answer is no, you do not have one.

MR. RUSSELL: We haven't reached it yet, however we are working in that direction.

MR. MACKINNON: That's what I needed to know. The answer is no. Right?

MR. RUSSELL: The answer is no at this time.

MR. MACKINNON: That's what I needed to know. Several weeks back, representatives from the Federation of Agriculture appeared before one of our Resources Committee meetings of the Legislature and expressed concern about the fact that they were excluded from the development of the provincial water strategy. I didn't mean to catch the minister off guard with that, perhaps experts within the department might be able to bring him up to speed on that. I found that a little concerning. I'm just wondering why they would make such an observation.

MR. RUSSELL: At the present time our focus is on drinking water, however, in the long-term strategy, the agricultural industry will certainly be a major point of interest for us.

MR. MACKINNON: Is that why they were not included in the discussions, in the implementation of that?

MR. RUSSELL: They were, that's why I expressed surprise when you first made that remark. They were included in the discussions, however our focus, as I say, and our energies are directed towards drinking water at the present time.

[Page 232]

MR. MACKINNON: I find it a little concerning, because agriculture, that's one of the bases of our survival, good food, good safe food and drink. In order to grow food, we have to have fresh, clean water, safe drinking water. It would be incorporated. I know there are different filtration systems and health variables to that.

MR. RUSSELL: The Department of Agriculture and Fisheries is on the committee. I wasn't privy to what went on at that committee meeting but I wouldn't want the member to think that we had no discussions with them because that's just not so.

MR. MACKINNON: I have to agree with you there because Mr. Cameron, from the Department of Agriculture and Fisheries, appeared before another one of our Resources Committee meetings - I believe the member for Kings County was there at the time, the Public Accounts Committee, I believe it was - and he expressed his frustration about the fact that the Department of Environment and Labour was dragging its feet on this issue and they had to pursue the issue for a water strategy on their own accord. All it was was meeting after meeting, really not achieving anything.

MR. RUSSELL: I come back to what I said a moment ago, our focus and our energies are all directed toward drinking water at the present time. However, the overall water strategy for the province is certainly underway, and agriculture forms a major part of that strategy.

MR. MACKINNON: I'm sure it does. I would like to shift the focus again, just slightly, with regard to occupational health and safety. The number of complaints that have come in in the last year, is that up or down from the previous year?

MR. RUSSELL: I will have to get that for you. I think it is down, if I remember correctly.

MR. MACKINNON: So if the number of complaints are down, I would presume the number of prosecutions are down.

MR. RUSSELL: I don't know, quite frankly.

MR. MACKINNON: I can take that on notice.

MR. RUSSELL: I will get you that information, but I am pretty sure that when I read a report just very recently, in fact two days ago, that the numbers of complaints were down.

MR. MACKINNON: What about the number of inspections, are they up or down?

MR. RUSSELL: We're moving into risk management, as I told another member who had some questions yesterday. As I said, we're setting up a new regime of inspections based on risk management which will take into account, of course, the history of the individual

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business. In that way, we think we can have more effective monitoring of industries across the province.

MR. MACKINNON: I believe that would be good. Are the total number of inspections up or down from the previous year?

MR. RUSSELL: I will have to get that back to you later. The only thing that I have here is that the number of prosecutions before the courts is 18 as of March 14^th of this year.

MR. MACKINNON: Is that up or down from previous years?

MR. RUSSELL: And I don't know that either. (Interruptions)

MR. MACKINNON: Anytime.

MR. RUSSELL: I'm going to have to get a chart for you.

MR. MACKINNON: I can take it on notice. On that point as well, the transfer of responsibilities for the training/education component. Am I correct, it was transferred over to WCB? How is that working?

MR. RUSSELL: Well, the prevention and the education component, of course, has been transferred to WCB, and I think it's working very well.

MR. MACKINNON: The staffing levels, overall - I will be honest, I didn't get too much into micro here - is it generally the same as it was in the previous year?

MR. RUSSELL: Are you talking about the whole . . .

MR. MACKINNON: The whole department.

MR. RUSSELL: It's around about the same. I think it's 472.9 compared to 472.9, so there's no change.

MR. MACKINNON: The change is zero. I understand there's a possibility of one position being eliminated in the Sydney office; is that correct?

MR. RUSSELL: Not to my knowledge.

MR. MACKINNON: Or being transferred to Halifax?

MR. RUSSELL: Not that I know of at the present time. I haven't been apprised of any changes, not to say that it's not going to happen, but . . .

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MR. MACKINNON: Have there been any changes?

MR. RUSSELL: Some of these changes are made at the district level. I've just been informed that there have been some discussions, just last week, of an individual who is looking for a transfer, and may be transferred from Sydney to Halifax.

MR. MACKINNON: I don't think that individual is looking for the transfer, I think that individual was notified that that position would be transferred to Halifax.

MR. RUSSELL: I will take it upon myself to get you an answer on that, because, quite frankly, I was not aware of that.

MR. MACKINNON: I would certainly appreciate it. How much time do I have, Mr. Chairman?

MR. CHAIRMAN: You have 24 minutes.

MR. MACKINNON: We have lots of time. With regard to alcohol and gaming, do you have the corporation? How does that particular agency work, in terms of permits?

MR. RUSSELL: I misspoke myself, the corporation belongs to Finance.

MR. MACKINNON: Or is it the commission? You have the commission.

MR. RUSSELL: It's not the commission, it's the authority.

MR. MACKINNON: There are so many acronyms, it's hard to follow.

MR. RUSSELL: You better believe it.

MR. CHAIRMAN: Just for clarification, according to my papers, Resolution E40, the Nova Scotia Liquor Corporation be approved, the business plan.

MR. RUSSELL: That's the Liquor Corporation.

MR. MACKINNON: This is in Environment and Labour.

MR. RUSSELL: The Gaming Corporation, I think, Mr. Chairman . . .

[Page 235]

[10:30 a.m.]

MR. MACKINNON: I think you know the line item I am referring to, on Page 9.2. It says Alcohol and Gaming, the Estimate is $4.4 million. I noticed that's going to be a reduction. Is there one fewer staff in that? It's on Page 9.2 of the Estimates Book. It's not a big amount.

MR. RUSSELL: There's a difference of $27,000 between the Estimate for 2003-04 and 2002-03. There are two deleted positions from that authority. There's negotiated salary increases now which are included in departmental budgets, as the honourable member realizes, and that is an increase of $90,000. The position of an IT analyst was transferred to the Resources CSU, and that's a reduction of $63,000. The two deleted positions were $67,000. So the staffing budget adjustment increase is $7,000, and the increase in fringe benefits is $6,000. You add up the pluses and minuses on that and it comes to $27,000. I know it doesn't make much sense, but that's the way it is.

MR. MACKINNON: Has the department implemented any new fees this year, or are they contemplating any new fees?

MR. RUSSELL: No, there is no increase in fees.

MR. MACKINNON: Is the department contemplating any increase in existing fees, in just about any division within the department?

MR. RUSSELL: Not to my knowledge.

MR. MACKINNON: Are you sure?

MR. RUSSELL: It's just been pointed out that there may be volume changes, which would affect the sum total, but the individual fees, there is no change contemplated in the mix.

MR. MACKINNON: There have been no fee increases with regard to the on-site sewage system program?

MR. RUSSELL: Which?

MR. MACKINNON: For the design and installation of on-site sewage.

MR. RUSSELL: No, that was all done. That was turned over to the private sector, as the member is aware, about two years ago. Whatever they charge as a going rate for services is beyond the control of the department.

[Page 236]

MR. MACKINNON: I'm a little familiar with it, as Mr. MacLellan might be aware. I am a member of that organization, Wastewater Nova Scotia. There have been fee increases by the department, and I'm just curious as to why we wouldn't have that detail. I can take it on notice. I don't want to put the minister in a box.

MR. RUSSELL: Are you talking about the amount of . . .

MR. MACKINNON: The cost of applications, fees and fines.

MR. RUSSELL: And this occurred this year?

MR. MACKINNON: In the last year, yes.

MR. RUSSELL: In the past year.

MR. MACKINNON: I will leave that with the minister, because he may want to consult with other staff in his department.

MR. RUSSELL: Elevators and lifts were increased last year.

MR. MACKINNON: No, no. I understand that, but I think that if he checks he will find that there are other fee increases, the cost of fines has been increased, a whole series of inspection fees. I think if you check that . . .

MR. RUSSELL: I'm told that the only increase in fees for this year were connected with lifts and elevators and cranes and those kinds of elevating devices.

MR. MACKINNON: How much does the government anticipate raising in additional revenue over what it would normally raise for the fee structures that you've just mentioned, like elevators, lifts, cranes?

MR. RUSSELL: Do you mean how much additional?

MR. MACKINNON: Yes, what do you anticipate?

MR. RUSSELL: It's $35,000.

MR. MACKINNON: I believe there are new regulations, I stand to be corrected. Have new regulations been adopted as of April 1^st for the digging and installation of wells?

MR. RUSSELL: No, there were no differences.

MR. MACKINNON: No changes in guidelines or regulations?

[Page 237]

MR. RUSSELL: No. There were two boards that were amalgamated, one was the wastewater board and the well water board. It's now an advisory committee.

MR. MACKINNON: But were there not new regulations adopted or guidelines . . .

MR. RUSSELL: For wells?

MR. MACKINNON: For wells, yes.

MR. RUSSELL: Not that I'm aware of.

MR. MACKINNON: The answer is still no?

MR. RUSSELL: The answer is still no. I know the honourable member's profession, and . . .

MR. MACKINNON: In fairness, I'm not trying to play cat and mouse with the minister.

MR. RUSSELL: I know, but I am interested. From that point of view, perhaps you could be a little more specific. Have you encountered this?

MR. MACKINNON: Yes.

MR. RUSSELL: Okay, tell us about it.

MR. MACKINNON: I know last year, for example - and I am just pulling numbers out of my head and I stand to be corrected - when you apply to put in an on-site sewage system, there are a series of applications and processes that you have to go through.

MR. RUSSELL: Understood.

MR. MACKINNON: You commission - depending upon if it's a one-, two- or three- bedroom home - what they call a QP2 or a qualified persons two, and if it's over that or an undersize or unique lot, you would have to commission a QP1 or an engineer-equivalent. Now, there is a fee structure for each step along the way. For the initial application, it might be a $50 fee, what they call a $50 entrance fee, so to speak, to get the application processed. If you follow the process through, and there are certain errors and omissions or if somebody does something that they shouldn't have, there is a fine structure that's put in place. That was increased last year.

MR. RUSSELL: The fine structure?

[Page 238]

MR. MACKINNON: Yes, by $50, just about right across the board, for each one of those issues. Perhaps I can leave it with the minister and his staff, if they would give an undertaking to provide that list.

MR. RUSSELL: Absolutely.

MR. MACKINNON: I've seen the list, and if you're not working with it every day it's foreign to you and I appreciate that. There are considerable dollars raised by the department through this process, considerable. I am told, upwards, well into the hundreds of thousands of dollars. I don't seem to see it flowing anywhere in this information.

MR. RUSSELL: If you're speaking about fines - is that what you're speaking about?

MR. MACKINNON: Not just fines, application fees and renewal fees.

MR. RUSSELL: Well, fines, of course, go into the consolidated funds of the province.

MR. MACKINNON: And I can appreciate that, but there are also other fees. If the minister would just get me the Schedule B, as I think it's referred to, on all those fees, application fees and fines and all that sort of stuff, because I can't find it on the Web site, per se, and maybe I'm just not looking in the right place. I have seen it, and I know there were some changes in the requirements for on-site sewage systems. For example, as of, I am told - perhaps Mr. MacLellan might be able to confirm this - April 1^st of this year, you can now install a septic tank within up to 50 feet from a watercourse, whereas before it had to be a greater distance. That's because the quality of the system has improved.

All these changes, there are certain fee structures that go with these. It's a new process. It's something that 99 per cent of the politicians in this Chamber wouldn't be familiar with, but it generates a considerable amount of money for the department or for the government in general. So if the minister would be kind enough just to give an undertaking, whatever he can find and ascertain, I would certainly appreciate it. I can just take that on an undertaking, would that be okay?

MR. RUSSELL: Yes.

MR. MACKINNON: I want to go back to the Alcohol and Gaming Authority. Approximately how many applications are received every year, for liquor licences and for . . .

MR. RUSSELL: Do you mean new ones or renewals plus new ones?

MR. MACKINNON: Yes, renewals plus new ones.

[Page 239]

MR. RUSSELL: There are thousands and thousands and thousands.

MR. MACKINNON: Could we find out how many thousands and thousands and thousands?

MR. RUSSELL: We certainly can. It's a very big volume, Mr. Chairman.

MR. MACKINNON: If we could get that number of big volume, and the big volume number that's attached to it, dollarwise.

MR. RUSSELL: Yes.

MR. MACKINNON: That would certainly be appreciated. I noticed, with the Workers' Advisers Program, if I could switch slightly, there's a reduction in the budget contemplated. It's on Page 9.6.

MR. RUSSELL: I can't see any reduction.

MR. MACKINNON: Maybe I am misreading it. It says the Estimate for 2002-03 was $1.693 million and then the Forecast is $2.074 million.

MR. RUSSELL: That's $2.074 in the Forecast, is that what you're referring to?

MR. MACKINNON: Yes, I am comparing the Forecast to the Estimate, I suppose. So in that sense there was an additional appropriation of money over what was contemplated. In general, I am just curious, is the workload up or down at the Workers' Advisers Program, the clientele?

MR. RUSSELL: About the same as it was.

MR. MACKINNON: That last couple of weeks, perhaps a little longer, I have heard reports about the backlog starting to grow again. Is that the case? Or is it that we just haven't wiped it out, per se?

MR. RUSSELL: It isn't completely wiped out, however, there is no dramatic increase.

MR. MACKINNON: Is there an increase?

MR. RUSSELL: There is no actual increase in the backlog, although the turnaround time, which is normally about 100 days, is up to about 110 days. We're in the process of bringing it back, not to 100 days but back to 91 days.

[Page 240]

MR. MACKINNON: So what you're saying is there are two numbers we're dealing with here, ones that were in the backlog . . .

MR. RUSSELL: The actual number of cases is approximately the same, but what has occurred is the time element is taking longer and we're in the process of bringing that back to below where it was before. It's up from 100 to about 110, and we want to bring it back to about 90.

MR. MACKINNON: How do you plan to do that? Are you hiring more staff?

MR. RUSSELL: We had an analysis done of the program, and based on improvements in the system, the way in which we handle the caseload, we will be able to achieve the figure of approximately 90 - 90 days. In other words, we hope to handle the caseload much more efficiently than we have in the past.

[10:45 a.m.]

MR. MACKINNON: I noticed, approximately two years ago the government did away with the ADR, Alternate Dispute Resolution program. I have heard different individuals, predominantly injured workers, ask for that to be reinstated.

MR. RUSSELL: The ADR program was tremendously successful, as the honourable member is aware. I forget exactly what the number was, but it was a huge total . . .

MR. MACKINNON: Depending on which segment or group you were dealing with, it was between a 65 per cent and 70 per cent success rate.

MR. RUSSELL: And it worked out incredibly well. I'm told that ADR will not really be necessary because of the fact that we are working through the caseload much more efficiently than we were in the past. As long as that early mediation takes place, we are indeed dealing with the problem. ADR was brought forward for a specific problem that we had about three years ago.

MR. MACKINNON: I know my time is getting a little short, and I may come back on this issue. I wanted to touch on this problem out in Harrietsfield. Has the government provided a copy of the soil analysis to the local residents there, or has one been done? If so, is it available for public consumption?

MR. RUSSELL: We did water sampling, but we haven't done soil sampling.

[Page 241]

MR. MACKINNON: I would think that soil sampling would be absolutely critical to ensuring that you don't have any type of seepage into the groundwater. If you're dealing with sandy gravel or silty sand, it's quite permeable, whereas if you have a considerable amount of clay - the residents do need that quality assurance.

MR. RUSSELL: This is something that is normally done by the proponent.

MR. MACKINNON: Has that information been supplied to the department?

MR. RUSSELL: That information was supplied to the department. However, the argument put forward by the people I met with on Tuesday was that because it came from the proponent, they felt that it may be biased. So we have agreed that we will establish a baseline for water and for soil.

MR. MACKINNON: I can appreciate their position and I can appreciate the department's position but soil analyses are soil analyses. It's not going to change. There may be a slight variation in opinion when you're dealing with permeability, but it's not going to be that significant. I would think that providing the soil test results would be absolutely critical to helping resolve this impasse.

MR. RUSSELL: We're doing that.

MR. MACKINNON: But the soil tests have not been made available to them.

MR. RUSSELL: Our soil sampling . . .

MR. MACKINNON: No, the soil tests. They have not been made available.

MR. RUSSELL: This will be a public document.

MR. MACKINNON: It will be but it isn't yet.

MR. RUSSELL: It isn't completed yet. The approval hasn't, as yet, been given to RDM at this time. We're still in the preliminary stage of consultation - actually we're not, we just finished the day before yesterday.

MR. MACKINNON: My time has expired, but we will come back, we will follow up on this.

MR. CHAIRMAN: Time is back to the NDP caucus for some questioning.

The honourable member for Halifax Chebucto, your time is now 10:50 a.m.

[Page 242]

MR. HOWARD EPSTEIN: I just wanted to advise you and the minister of what we intend to do in this coming hour. We would like to switch topics and start dealing with automobile insurance. The way we propose to deal with the hour is that my colleague, the member for Cape Breton Centre, will start for about the first one-third of the hour. I will then take it up, and my colleague, the member for Halifax Fairview, will deal with the latter part of the hour. So we would like to switch topics, if we may. As I said, my colleague, the member for Cape Breton Centre, will start.

MR. RUSSELL: Okay, we will change the batters' list up here.

MR. CHAIRMAN: The honourable member for Cape Breton Centre.

MR. FRANK CORBETT: Mr. Minister, just about an hour and a half ago, you held a press conference to inform the public that you were appointing an auto insurance consumer advocate. There are many things left unsaid in that release, not the least of which is the number of staff the advocate will have available and the fact of whether his findings would be binding on government.

MR. RUSSELL: Okay, which question do you want me to deal with first?

MR. CORBETT: First would be staffing and then . . .

MR. RUSSELL: There will be no permanent staffing, let me put it in those terms. However, we will have available to him the expertise that he requires to do his job properly. He will have the benefit of staff within the department. He will have a specialist, who will be available. That person, I believe, is in the process of being hired. There will be clerical staffing and that kind of thing that he requires. Again, that all falls within the total budget for the program, which is $250,000. That would include his travel, et cetera.

MR. CORBETT: Then the second question is, will his report be binding on government?

MR. RUSSELL: I can't answer that question, because it depends entirely on a review of what he comes forward with. Obviously, in the final analysis it's going to be Cabinet that's going to decide. I would suggest to you that whatever Mr. Jordan comes forward with is going to be primary in arriving at a decision.

MR. CORBETT: What we're saying then is we now have more window dressing, pre-election, than trying to resolve this issue around skyrocketing insurance. What we have is someone to go out and delay beyond the call of the next election, and government is not tying itself to whatever the commissioner's report is going to be. It's going to be decided by Cabinet anyway.

[Page 243]

MR. RUSSELL: We put out a brochure, as the honourable member is aware - and we probably have one lying around here, you know the one I am referring to, The Road Ahead - and it outlines a number of different things that can be done to the insurance system to either tweak it or radically change it, as the case may be, to achieve stability in insurance rates and a lowering of insurance rates. We would like to see several other things happen, however, the purpose for having Mr. Jordan leading the charge is simply that we want to make sure that we have somebody who is independent of government - and he is independent of government - out there examining all options, talking to people, to determine what they're doing in other jurisdictions, as Mr. Jordan said this morning during the press conference. This isn't a Nova Scotia problem, this is a problem that's right across this country and in the U.S. as well. It's not something that can be resolved just by waving a magic wand.

MR. CORBETT: Certainly there were some other things. It was interesting this morning when Mr. Jordan said he's looking at all options, but before that even gets started your government has already said that public ownership is not an option. Is that correct?

MR. RUSSELL: Public ownership of an insurance system is not on our radar screen at the present time, that's for sure.

MR. CORBETT: So if he comes forward with that . . .

MR. RUSSELL: If he comes forward with that proposal, then obviously the Cabinet and Treasury and Policy Board are going to have to consider that option, and it will be considered. At the present time, we would prefer that the government not become involved in an insurance scheme, no.

MR. CORBETT: While he has been hired as an independent advocate, he's being staffed with people you have hired for him. So in essence, there's really not much independence there.

MR. RUSSELL: Obviously you don't know Mr. Jordan. I can assure you that Mr. Jordan is not a lapdog of the government. Mr. Jordan is going to go out there and do his task, he's going to do it independent of government, he's going to come forward with recommendations, those recommendations will go to the Treasury and Policy Board and Cabinet, and will form the basis of whatever action we take with regard to insurance.

MR. CORBETT: This is not about Mr. Jordan and his personal . . .

MR. RUSSELL: You seemed to be making that inference.

MR. CORBETT: No, I'm making the inference that you're boxing him in.

[Page 244]

MR. RUSSELL: He has not been boxed in in any fashion whatsoever. He's been told that the options that are in this book, he can examine all those and any other options that are in place across this country or across North America.

MR. CORBETT: Well, it's like Peter the Great, my people say what they want but I do what I want. That's pretty well the angle this government seems to be taking.

MR. RUSSELL: No, that's the difference. When you're in government you have to make the choice, and regardless of what we do, it's going to be the government that actually enacts it, it's the government that's going to carry the ball for it. So this gentleman is going to provide advice to government, he's going to provide knowledge that we don't have at the present time, and based on that there will be a solution to this problem, I can assure you.

MR. CORBETT: You already have, obviously, some information, so I would like you to enlighten me on this one. In Question Period on April 2^nd, in reply to a question regarding public ownership, in particular Manitoba and Saskatchewan, you said it's like comparing apples and oranges because they have straight roads, they have flat roads, and that makes a difference in premiums. Can you tell me how you arrived at that? Is there any actuarial evidence that says that's a fact in point?

MR. RUSSELL: I lived in Manitoba for quite a period of time, many years ago, admittedly, but during the time they had a public system out there. In point of fact, that is one of the things that does affect the rate that people are charged for a premium in insurance, where they live. If you live in a city you have a higher rate, if you live in the country you get a lower rate, probably, because there's less traffic. In the western provinces where you do have straight roads and flat roads, they have less accidents, so therefore that translates into the rate that you pay for insurance policies.

MR. CORBETT: We see in this province there's a fair amount of discrimination against the younger drivers and the older drivers. You don't see that in Manitoba and Saskatchewan. They ride the same flat straight roads, so . . .

MR. RUSSELL: And if you talked to them they will tell you that that is a component, however, don't forget the fact that they are no-fault systems, which also impact upon rates.

MR. CORBETT: You're saying both Saskatchewan and Manitoba are completely no-fault? Is that what you're telling us?

MR. RUSSELL: They're not completely no-fault. They have caps, I believe, in Manitoba, and I don't know if they do in Saskatchewan or not.

[Page 245]

MR. CORBETT: It's a mix in Saskatchewan, some tort and some no-fault. What you're saying now is - I asked you about the flat, straight roads, and that's a component, but in your answer that's primarily the reason rates are low, it's not because of public auto, it's because of . . .

MR. RUSSELL: I'm telling you you're looking at apples and oranges because they have different coverages under government systems, and you buy additional insurance on top of those mandatory coverages under the public system, at least you do in British Columbia, you buy that from a private carrier, and I believe in Manitoba you do that as well.

MR. CORBETT: See the value in those publicly-funded systems, where insurance follows the driver and not the vehicle?

[11:00 a.m.]

MR. RUSSELL: Let me answer that by saying that the coverage should follow the driver, but I'm not saying necessarily that that's only obtainable under a publicly-funded system.

MR. CORBETT: It's not in any of the privately-funded.

MR. RUSSELL: Do you - I can't ask the questions, so forget it.

MR. CORBETT: Do you have a leased vehicle from the province?

MR. RUSSELL: I have a leased vehicle.

MR. CORBETT: And how is that insured?

MR. RUSSELL: It's insured through the private sector.

MR. CORBETT: Do you have your own insurance on that?

MR. RUSSELL: Do I have my own insurance? What do you mean?

MR. CORBETT: Do you have Sun Alliance as a company similar to that that insures your leased vehicle?

MR. RUSSELL: The province insures the vehicle. I have my own insurance, though, from the point of view of PL/PD . . .

MR. CORBETT: But the leased vehicle is insured by the province?

[Page 246]

MR. RUSSELL: Yes.

MR. CORBETT: Okay. The province, therefore, is a self-insurer.

MR. RUSSELL: No.

MR. CORBETT: The province is not a self-insurer?

MR. RUSSELL: Not for my vehicle.

MR. CORBETT: Who insures your vehicle then? How many vehicles does the province have insurance on?

MR. RUSSELL: All the vehicles are insured by a private carrier, and it goes out to tender. I'm not too sure, I had a firm in mind but I don't think they won the tender the last time. Anyway, I don't know.

MR. CORBETT: So you're saying that all provincially-owned vehicles are insured by a private insurance firm?

MR. RUSSELL: I'm talking about cars, automobiles, I'm not talking about vehicles such as snowplows and cranes and tractors and graders, et cetera, because I don't know. I'm not sure about that. I do know that the automobiles that the government owns are insured by a private carrier.

MR. CORBETT: You're saying then that there are no standard automobiles self-insured by this government?

MR. RUSSELL: There's no . . .

MR. CORBETT: What we would call a sedan - we will get heavy equipment out of the loop - just regular automobiles, you don't have any of those self-insured? None of the ministers' vehicles fall under that category?

MR. RUSSELL: I won't go out on a limb and say that they're all insured, because you can probably find one that isn't. I can tell you that the Department of Transportation and Public Works insures all those types of vehicles through a blanket policy which goes out to tender and is met by the private sector.

MR. CORBETT: What would you say to me then if last year's rate was $465,000 and this year's rate was $1.1 million, since the drastic increase, since that doubled, that they would self-insure. What would you say to that?

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MR. RUSSELL: I would suggest that you take this up with the Minister of Transportation and Public Works, because quite honestly I'm not completely familiar with what is appearing this year in the Department of Transportation and Public Works.

MR. CORBETT: What I'm going at is, we're talking about insurance rates doubling and so on. I find it ironic when you have a government that's fundamentally against public auto, but when it's public vehicles - I'm not just talking about such things as road graders or snowplows - that it's all right for government officials to be self-insured by the government but it's not okay . . .

MR. RUSSELL: Who said we're self-insured?

MR. CORBETT: Well, it says here - you can check with Mr. Langille of Transportation and Public Works, in his words there was $465,000 the previous year and it jumped to $1.1 million. Can you tell the committee today who insures your vehicles?

MR. RUSSELL: There was only one company from across Canada that applied for the fleet coverage last year, and that's what it was.

MR. CORBETT: Who is that? Who insures your leased vehicles?

MR. RUSSELL: You will have to ask Transportation and Public Works because I don't know.

MR. CORBETT: So you're assuming that it's a private company, you don't know for sure.

MR. RUSSELL: I know that it was, and I assume that there's been no change but you will have to talk to Transportation and Public Works.

MR. CORBETT: You don't know who owns the insurance on those cars, whether it's taken in by the government or not?

MR. RUSSELL: As I say, I don't want to answer this question and lead you down a trail that is incorrect. I would suggest that you either pose this question to Transportation and Public Works when their estimates are on the floor, or else leave it with me and I will get you a written answer.

MR. CORBETT: We'll do that.

MR. RUSSELL: We just pay the bills that come to us from Transportation and Public Works.

[Page 248]

MR. CORBETT: Mr. Minister, you're the minister responsible for insurance. Don't you think that if the insurance doubled, you tell us now that you have The Road Ahead document, and you've looked at stuff already, and yet you haven't bothered to say - you're probably the largest fleet owner in this province, the provincial government . . .

MR. RUSSELL: But we're not . . .

MR. CORBETT: The provincial government is.

MR. RUSSELL: The Department of Transportation and Public Works . . .

MR. CORBETT: I would think you would even have some handle on that because you haven't been that far removed from that department, and you would have some idea of a discussion of that magnitude, if we were going to go from a private carrier to underwriting your own cars, that is not something that department would have done overnight, and it would have been carried on in your thoughts about public versus private coverage.

MR. RUSSELL: Self-insurance works sometimes and sometimes it doesn't. You have to be a pretty large organization to do that. The way liability suits are running these days, you could run into millions and millions and millions of dollars, I think perhaps you're better off giving the risk to somebody else. However, that's just my own personal viewpoint.

MR. CORBETT: I would like some clarification on that, because it's certainly every indication from government sources that vehicles such as your own are underwritten by the government itself and not by a private company, and therefore it sets, certainly to my estimation, a double standard from where you as a minister would say we don't believe in public auto but it's all right for us if you're a minister. That's the question I want answered, and you will endeavour to get that for me.

MR. RUSSELL: I'm telling you that our insurance is not self-insurance, we are insuring through a private carrier.

MR. CORBETT: Okay, and I'm asking. I'm getting contradictions here from information from T&PW and from you. You said you would give me written confirmation of that, and I will take your word on that, who the carrier is and the general terms.

MR. RUSSELL: I wish I had my pink card in my pocket, but I don't. I know it used to be Bell & Grant, but I don't think Bell & Grant are still the insurers. I don't think they won the tender. As I said, I don't know.

MR. CORBETT: Thank you, I'm going to hand the questioning over to the member for Halifax Chebucto.

[Page 249]

MR. RUSSELL: Okay. We will get back to you on that business of the carrier.

MR. CHAIRMAN: The honourable member for Halifax Chebucto.

MR. HOWARD EPSTEIN: Mr. Minister, I'm going to pursue another aspect of the insurance part of your portfolio. You will recall, of course, that the topic of automobile insurance rates has been discussed, debated twice recently in the House. Resolutions came forward and other devices were used to bring it forward in the House. In one of these debates on the 1^st of this month, you made the following comment, and I want to quote it to you and I would like to discuss it. Here's what you said, "First of all, I don't even think we can do that at the present time under the NAFTA arrangements." You said that on April 1^st, to be found in Hansard, Page 347 for that day. I wonder if you could explain to me why is it that you think that a public automobile insurance scheme is not possible under NAFTA?

MR. RUSSELL: Because insurance is covered under NAFTA. The provinces that have public systems, as I understand it, have been grandfathered in by virtue of the fact that in the general agreement, they were recognized. For argument's sake, if we wish to set up a publicly-funded scheme in Nova Scotia, we would be required to obtain some kind of an exemption. It would just not be possible at the present time to have that kind of a system under the present NAFTA agreement.

MR. EPSTEIN: You speak as if public automobile insurance schemes or, perhaps a more general category, government monopolies, are specifically prohibited under NAFTA. I have to say I've been trying to read the agreement, and I haven't found such a clause. Is there a particular article . . .

MR. RUSSELL: I understand that insurance is. We spoke to the person in government who looks after that particular agreement and its aspects relative to insurance, and he assures us that that is so.

MR. EPSTEIN: Have you something in writing on this topic?

MR. RUSSELL: Yes, we do.

MR. EPSTEIN: I would be very interested in seeing it. Is this something that you're prepared to put on file with us, because I have to say it has not been our interpretation so far of this.

MR. RUSSELL: It's imbedded in another document. We can't release the whole document, but that particular aspect, yes, we can do so. I know a person who approached me some time ago about insurance brought that to my attention, and he also was one of your profession, the legal profession.

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MR. EPSTEIN: Just to be clear on where it is we're going to leave this, is this in the category of one of those documents or, as you say, a partial or an extract from a document that will be filed with the committee as the chairman indicated early on?

MR. RUSSELL: If we can release the entire document, we will.

MR. EPSTEIN: I don't know what the whole document covers, it's really the focus on insurance that I'm interested in.

MR. RUSSELL: It's in a briefing note and an e-mail. This was one of the specifics that we looked at because we were interested in the department, particularly when we got the NDP document.

MR. EPSTEIN: In case we have to pursue this, can you tell us the approximate date of this document? It's a briefing note, I gather, from the Department of Finance.

MR. RUSSELL: It's very recent, probably two or three weeks ago.

MR. EPSTEIN: That would be very useful because I have to say it's not our understanding that there is a problem under NAFTA, and to the extent that we could think there might be anything involved, it might conceivably be under the expropriation article, 15.10, but even then there are quite a number of contingencies that I understand would apply. First, there would have to be an automobile insurance company, owned in the United States or Mexico, our NAFTA partners, that were deprived of business opportunities. Second, they would have to bring it within the wording of the expropriation article. Third, even if they could do that, it would be the federal government that would be obliged to pay, not the provincial government, because the provincial government, of course, is not a signatory to NAFTA, it's the federal government that's had to pay any claims.

MR. RUSSELL: Well, the honourable member has me at a disadvantage, I'm not a lawyer, but every lawyer you get is going to give you a different opinion anyway, I think. We do have an opinion that differs from that. I expect that we will probably make that document, as I said, available to the honourable member.

[11:15 a.m.]

MR. EPSTEIN: Well, there is an old joke that one lawyer in town starves but two do very well. (Interruptions) But I have to say that I don't think that on all subjects there are disagreements among lawyers. I guess we will see about this one. Can I ask you some questions about the consumer advocate? I wasn't able to be present at the announcement this morning, so I'm perhaps missing a small bit of information. Is this a short-term position, purely?

[Page 251]

MR. RUSSELL: This is a contract, and it's a contract with Mr. Jordan's company. It is for an eight-month period. This is to look at the whole world of having a consumer spokesman or spokesperson.

MR. EPSTEIN: I didn't mean whether it was short-term for Mr. Jordan or his company, I think what I meant was whether the idea was that the position is going to be an ongoing position, or is it simply the eight months that's contemplated?

MR. RUSSELL: I can tell the honourable member that that decision has not as yet been made. This is a short-term contract that we have with Mr. Jordan. I expect that, knowing Mr. Jordan, he will do a very good job for us and for the people of Nova Scotia who have an interest in insurance. Now there are other things that may require advocacy along the way, so we're going to have to take a look at what the long term . . .

MR. EPSTEIN: By other things, you mean beyond automobile insurance?

MR. RUSSELL: Yes.

MR. EPSTEIN: Perhaps other things that consumers are concerned about.

MR. RUSSELL: Exactly.

MR. EPSTEIN: Telephone rates, electricity rates, that sort of thing.

MR. RUSSELL: You're absolutely right. What we're doing at the present time has a very narrow focus, it's on auto insurance. Heaven knows there's a number of other problems that involve consumers.

MR. EPSTEIN: His prime job is perhaps to receive the information that will come in response to the survey that you're doing and to process that for the government. Is that right?

MR. RUSSELL: That's part of it, and that information should be in the office by May 15^th. Mr. Jordan will also be speaking to and consulting with groups that have an interest in insurance, and that would include, but is not be limited to, senior citizens, young drivers coming on the scene, it would be involving the legal profession, it would involve the insurance industry, the Nova Scotia Safety Council, there is a whole range of people whose knowledge we want to tap into.

MR. EPSTEIN: Well, it's certainly the case that just about everyone in the province is concerned about the high automobile insurance rates, so I am sure Mr. Jordan will have lots of people to consult with. What I was wondering was whether he will be performing any kind of intervention role with the insurance companies on behalf of individuals who are

[Page 252]

puzzled about their rates and not finding satisfactory answers or will he just be gathering information?

MR. RUSSELL: He will just be gathering information and listening to those persons who have those kinds of problems. However, there is a route for those people to travel at the present time, which is through the person in the department, of course, who is the Superintendent of Insurance and then the Insurance Bureau of Canada has an ombudsman.

MR. EPSTEIN: At some point later this year, there may be another round of proposed increases in rates from the insurance companies that will be doing filings with the URB. If there's a second round of public hearings, would the consumer advocate be involved in the next round of hearings?

MR. RUSSELL: Yes.

MR. EPSTEIN: Speaking up on behalf of consumers? Is that the idea?

MR. RUSSELL: Yes.

MR. EPSTEIN: Mr. Minister, you mentioned, as part of what the consumer advocate would look at, meeting with groups like seniors and young people, and I assume you said that because those are groupings of people who have complained that their rates have gone up unfairly, that is unrelated to their own particular circumstances and perhaps because of their category by age. I think I heard you speak in the House about these kinds of groupings as discriminatory. I'm wondering if you've already identified some of these practices as essentially unfair to consumers and whether you anticipate - well, first can we start with, can you tell us what categories you think are already inappropriate in the rating systems?

MR. RUSSELL: I think that age, whether it's young age or old age, is important. I think that people should be judged on their driving record rather than just saying arbitrarily, at age 65, that you've become an imbecile suddenly and shouldn't be put in charge of a motor vehicle. I think the same thing applies to young people. There are many 17-year-olds who are far better drivers than people who are in their 30s and 40s who have maybe 20 years of experience driving. Some people in all age groups, when they get behind the wheel, become idiots. In general, that's not a component of age, it's a component of the state of mind, I guess. I think that people who move and have to change their insurance carrier, I don't think that that should say, well, you go back to square one and you start off as a new client with this company, therefore we're going to charge you the highest rates we possibly can. There are dozens and dozens of things like that that I could name.

MR. EPSTEIN: Would location in the province be one, for example? That is, is there a reason for different rates in Halifax, Yarmouth, Sydney, Truro?

[Page 253]

MR. RUSSELL: I can understand the risk management of insurance companies in charging more, perhaps, for urban drivers than for country drivers. However, insofar as dividing the province up, my deputy has just reminded me, we have three regions, as I understand it, in the Province of Nova Scotia, but in the Province of New Brunswick, for instance, they do divide it up territorially. I think there are about eight different regions in New Brunswick.

MR. EPSTEIN: What I was asking really was whether you thought it was logical to do that, or whether it's irrelevant . . .

MR. RUSSELL: No, not unless there is evidence that, indeed, driving, for instance, in a congested urban area is more likely to cause accidents than driving somewhere else. I'm not in the actuary business, and quite frankly I don't think I'm competent to answer that question. I can tell you, for instance, I'm talking about things such as age or talking about evidence of driving history, talking about the fact that I think you should be able to pick up your insurance company's policy, read it and understand what the heck it means without having to go out and hire a lawyer to find out what it means. There are many things along those lines that we can do to make insurance more transparent. Also, I think people should be told why they are placed in a certain rate category, insofar as premiums are concerned.

MR. EPSTEIN: What I really wondered about this, Mr. Minister, was whether there was anything now that was a barrier to the provincial government actually acting in order to make the insurance companies rate people in ways that don't offend these categories that you think are inappropriate. Is there anything standing in the way of the province doing that at the moment?

MR. RUSSELL: I think that we want to examine the whole waterfront before we go into any regulatory change. I'm not knocking the URB but they are being quite slow in coming forward with the determination as to whether or not the rates are indeed fair and valid, et cetera.

MR. EPSTEIN: I think we've all noticed that. Do you actually have any indication of when on earth we might be hearing from the URB?

MR. RUSSELL: It's always next week.

MR. EPSTEIN: Yes. I see. Moving to another aspect of this whole issue. I'm sure you're aware that a lot of the debate that's been going on between the Insurance Bureau of Canada on behalf of the insurance companies and the public and their critics has focused on why it is that rates have gone up so amazingly in our province and elsewhere. Their refrain, regularly, has been to blame soft tissue injuries and say that the amounts awarded for soft tissue have really been the driver here. I think I quoted to you a statement from the federal Department of Finance's Web site, where they describe the insurance industry and say it's

[Page 254]

not unusual, in fact it's the normal thing for the insurance industry to lose money, if you just measure premiums paid against claims paid each year, and that really the essence of the money flow for insurance companies depends on their investments.

I'm wondering where you stand on the soft tissue issue. Do you have a position on this? Have you made a determination as to whether this is a fair claim being made by the insurance companies?

MR. RUSSELL: I don't know. Quite frankly, I don't. The legal profession will tell you one story, and the insurance industry will tell you another story, and the consumer will tell you another story. That's one of the reasons why we got Mr. Jordan, because he is separate from the whole system, and he's going to take a look and perhaps, hopefully, come forward with some evidence as to what is really the case, in the case of . . .

MR. EPSTEIN: It's going to be part of the consumer advocate's duties to examine this soft tissue issue?

MR. RUSSELL: Not to examine, but to find out exactly what the statistics are with regard to the claims by those who are looking for tort reform and those who don't want any tort reform, and part of that, I'm sure, will be whether or not the numbers that are put forth by the industry and the numbers that are put forth by the Barristers' Society and the numbers, as I say, that have come to the attention of the public through the media, what is actually valid.

MR. EPSTEIN: So you're expecting advice from Mr. Jordan as to whether a no-fault system is appropriate?

MR. RUSSELL: That's one of the things that he's looking at, that's one of the things that's in The Road Ahead, as being a - I won't say a possible solution, but as something that should be looked at, perhaps.

MR. EPSTEIN: And as part of that, he will be examining the claims of the company with respect to soft tissue injuries?

MR. RUSSELL: Yes.

MR. EPSTEIN: Okay, very interesting. Thank you. I will yield to my colleague, the member for Halifax Fairview.

MR. CHAIRMAN: The honourable member for Halifax Fairview.

Your time is now 11:29 a.m., you have until 11:50 a.m., sir.

[Page 255]

MR. GRAHAM STEELE: Mr. Minister, I am confused by the mixed messages coming out of the government. The government seems to have it all ways on the auto insurance issue. I want to explore some of the contradictory things that have been said, mainly by yourself, Mr. Minister, and ask you what's really going on here. The first thing I would like to ask is a simple question, where in the Estimates Book is Mr. Jordan's budget?

MR. RUSSELL: It's in the Policy Division, $250,000 in there.

MR. STEELE: I did notice there was a substantial increase in that line item, so I just wanted to confirm that that's where it is. Mr. Jordan has no previous experience in dealing with the auto insurance industry, so he's going to need to rely on technical expertise. You said earlier that he is going to have the services of an expert who is not yet hired. What kind of expert, where are you going to find them, who is it going to be? This is an important job, because Mr. Jordan doesn't have any independent knowledge of the insurance business on his own. When are we going to get this person?

MR. RUSSELL: I didn't say an independent expert, I said expertise.

MR. STEELE: Okay, what does that mean? Tell us what that means.

MR. RUSSELL: That expertise will probably come from a person with legal training, who has expertise in the insurance industry. We should have some names and probably somebody hired, I would imagine, initially to provide that . . .

MR. STEELE: I get worried when I see you hastily backing off on my phraseology of an independent expert. If they're not getting an independent expert to help Mr. Jordan, what are they getting? Are they independent or . . .

MR. RUSSELL: I didn't say - I said expertise, not necessarily just an individual. There may be a requirement for knowledge in various areas of information that's required to help Mr. Jordan complete his task.

[11:30 a.m.]

MR. STEELE: If it's not an individual, then they're a firm. Are you talking about hiring an accounting firm, a law firm, an actuarial firm, what are we talking about here?

MR. RUSSELL: No, it will be an individual.

MR. STEELE: Okay, it's an individual that you're loathe to refer to as an independent expert. They will have expertise, but they may be a lawyer, they may have experience in the industry, but to understand a lot of the technical stuff that's going on, you really need an actuary. Who's this super-person that you're going to get to give Mr. Jordan

[Page 256]

the technical background that he's going to need to deal with the dozens of people and millions of dollars that the Insurance Bureau of Canada can throw at him?

MR. RUSSELL: Mr. Jordan is a consumer advocate. He's working on behalf of you and me and every other consumer in the Province of Nova Scotia. He will require, because he is not, as you say, an expert in insurance and, heaven help us, we don't want that type of a person acting as a consumer advocate. We want somebody who has access to the knowledge that he requires to do his job properly, and Mr. Jordan will require somebody who has the expertise in the field of law, so that he can take policies, et cetera, and translate them, a person who has the knowledge of the industry, how it works, those are the kinds of expertise we want to get for Mr. Jordan. At the present time, there is a search on for somebody who can start this system off, providing knowledge to Mr. Jordan.

MR. STEELE: This is only one of several contradictions in the government's approach to this, because if he's a consumer advocate . . .

MR. RUSSELL: The contradictions, I would suggest, are in the mind of the honourable member.

MR. STEELE: Mr. Minister, I haven't asked a question. I haven't asked my question yet.

MR. CHAIRMAN: Order, no badgering, please, back and forth. Try to ask a question.

MR. STEELE: I haven't asked my question yet, so you will have the floor when I ask my question. If you're going to have a consumer advocate who is on my side and your side, Mr. Minister, that's a full-time job by itself. If you're going to have somebody who is going to study insurance systems across Canada, and advise the government on the shape of the insurance system that's going to solve the problem, that's another, much more complicated job, and you can't have one person doing both. The best analogy that I can think of, of what's going to happen here, and I know what's going to happen here, and I will tell you, and in six months from now you will look back and say, yes, he was right.

This is going to be exactly like Bruce Hood, and the consumer advocate in the airline industry. So the federal government turns to a former NHL referee, no particular experience in the airline industry but a good fellow, somebody well respected. What happened to Bruce Hood? He was absolutely swamped by consumer complaints. He wasn't given the resources to deal with that part of his job, which was simply to take in the calls and try to kind of be an ombudsman for people who weren't happy, especially with Air Canada but other airlines as well.

[Page 257]

So you have a guy who was absolutely swamped with consumer complaints, which Mr. Jordan will be. You have a guy who was under-resourced to deal with it, which Mr. Jordan will be. Bruce Hood ended up eventually throwing up his hands and giving up without any real solution to the problem. That's what's going to happen to George Jordan, because you're asking him to do absolutely everything, the consumer advocacy piece, the research piece, the advice and recommendation piece, and you're hardly giving him any resources to do it. How do you expect George Jordan to deliver on everything that's being demanded of him?

MR. RUSSELL: Mr. Chairman, in response to the honourable member, Mr. Jordan is not looking after consumer complaints. That is being looked after by the existing framework that we have in place.

MR. STEELE: But it's not, Mr. Minister.

MR. RUSSELL: Mr. Jordan is going to become an advocate for consumers and come forward with a program that will alleviate the present intolerable circumstances we have with regard to insurance premiums. He is not going to be talking to Ron Russell who has a problem because his insurance premium has tripled this year, and going to take that and take it forward. That's not his job. His job is to take the consumer side across the whole province, the general feeling of the people, the general temperature of the people, and examine the system that we presently have. He will have the resources, we will make those resources available within the budget that we have so that he can get whatever information it is that he requires to do his job properly.

MR. STEELE: In a news release today, among many other things, Mr. Jordan is quoted as saying that I want consumers to tell me their stories.

MR. RUSSELL: Yes, exactly.

MR. STEELE: I'm going to tell you that he's going to be swamped with those stories. Now, I think you're giving Mr. Jordan an impossible job, and you're not giving him enough money to do it. You're giving him a deadline that takes you past the next election. I think that's all deliberate. Now, the terms of reference, where are Mr. Jordan's written terms of reference?

MR. RUSSELL: They are attached to his contract.

MR. STEELE: Will you table the contract? Can you think of one, solitary good reason why you shouldn't table it?

MR. RUSSELL: No, I can't think of any, except that I believe - protection of privacy.

[Page 258]

MR. STEELE: There is no privacy interest to be protected here. You've hired somebody, and you've already told us how much is he being paid.

MR. RUSSELL: I would tell you that when you make a contract, and you are well aware, as a lawyer, that you cannot release that contract without both parties agreeing to it.

MR. STEELE: That's absolutely wrong, Mr. Minister. You are absolutely 100 per cent wrong.

MR. RUSSELL: Oh, am I?

MR. STEELE: Yes, you are. Under the Freedom of Information and Protection of Privacy Act you have a duty to release that contact.

MR. RUSSELL: We're not talking about the Freedom of Information and Protection of Privacy Act.

MR. STEELE: Okay, Mr. Minister. If you want to argue it that way, it's a public servant hired with public money to do a public job. You have a duty to release that contract, and I'm asking if you will make that commitment.

MR. RUSSELL: I'm not saying that we will not release the document, what I'm telling you is that I can't say we're going to release the document. It's going to have to be in conjunction with Mr. Jordan. If Mr. Jordan is okay with the release of his contract, away it goes.

MR. STEELE: Excellent. So we will make sure that we contact Mr. Jordan and ask him, and I'm sure he will say yes.

MR. RUSSELL: You do not have to contact Mr. Jordan, I will contact Mr. Jordan.

MR. STEELE: The thing is, Mr. Minister, we will play the government's game and we will make sure that we find out Mr. Jordan's point of view.

MR. RUSSELL: Why do you always have to . . .

MR. STEELE: I haven't asked a question yet. My point to you, Mr. Minister, is that you do not need Mr. Jordan's permission. You are mistaken about that. Under the law as governing government information, you do not need his permission. Even if Mr. Jordan says no, you still have a duty to release it. That's my point. Now, if asking Mr. Jordan his permission is what it takes for us to get it today, fine, but I just want you to know that you don't need his permission to release that information.

[Page 259]

Now, let me talk about timing. Mr. Minister, one of the other things that's confusing me - because we're getting mixed signals on this, about timing - I believe you're on the record somewhere saying that solutions would be delivered before the next election. Yet, this morning you said that you're not expecting even an interim report from Mr. Jordan before six months from now, which takes us into October. Can we expect to see solutions before the next election?

MR. RUSSELL: You're asking me when the next election is going to be? Personally, if you want my personal opinion, I don't think we're going to have an election until 2004, in the Spring.

MR. STEELE: So you will deliver something for us before the Spring of 2004. (Interruptions) Mr. Minister, would you care to put some money on that?

MR. RUSSELL: Well, you're not supposed to bet on elections. (Interruptions)

MR. STEELE: Or, as they like to say on Seinfeld, care to make it interesting? I will put $100 down that says we will have an election before Mr. Jordan delivers his report. Will you do the same?

MR. RUSSELL: I'm not going to take that bet. However, if you would like to perhaps - let me think about it and I will try to find some suitable type of non-monetary . . .

MR. STEELE: Okay, I'll tell you what, here's the deal - if he delivers his report before the election, I will pay half your insurance, and if he delivers it after the election, you pay half of mine, how's that?

MR. RUSSELL: That might not be fair, because my insurance rates are pretty good because I haven't had any accidents. (Laughter)

MR. STEELE: Mr. Minister, just for the record, neither have I, except in Manitoba, but that's another story.

MR. RUSSELL: Well, there you go. Your record travels with you.

MR. STEELE: Mr. Minister, on March 19^th in the Cape Breton Post you are quoted as saying, and this refers to you, Mr. Minister, "He said he plans to gather public input by mid-May, adding some actions could be taken quickly thereafter." So, Mr. Minister, what kind of actions can Nova Scotians expect from you by the middle of May?

[Page 260]

MR. RUSSELL: We have not as yet received back the responses to The Road Ahead. We're expecting those responses to be in by May 16^th. We've had 1,312 downloads up until Friday of last week. I guess that's all that's telling me; it's been the most popular thing on the Web.

MR. STEELE: What kind of action do you think we can expect by the middle of May?

MR. RUSSELL: I don't know, because I don't know what the consensus is going to be from The Road Ahead. By that time, Mr. Jordan will have his feet fully wet, if I can use that term, and I am sure that he will have some preliminary remarks to make as well, and it's quite possible that some of those things can be done immediately.

MR. STEELE: Well, anything's possible, Mr. Minister. But do you know what's going to happen by the middle of May, Mr. Jordan will be coming up for air after being swamped by consumer complaints, he will just be getting around to hiring that super-consultant who's going to advise him on absolutely everything, including law, actuarial numbers, accounting and everything else to do with the industry, and we won't see anything by the middle of May. You are quoted in the paper as saying that we can expect action quickly thereafter. Well, what can we expect? But you've already answered the question. This morning you said that you expect something from Mr. Jordan in six months. What exactly do you expect to get out of him in six months?

MR. RUSSELL: I expect to have a report from him within six months, not necessarily at the end of six months, within six months, of what progress he's making, what he's determined, to date.

MR. STEELE: Is that in his contract, that he is required to deliver a report within six months?

MR. RUSSELL: I can't answer that question, I don't know offhand.

MR. STEELE: Well, we will all know when you table his contract.

MR. RUSSELL: Yes, indeed. I didn't quite finish there, Mr. Chairman. Mr. Jordan is a reasonable person. He's not going off into isolation, and going to banish from sight for the next eight months of his contract. He's going to be around and I am sure he's going to be talking to me and probably the NDP and probably the Liberals and everybody else to obtain a divergence of opinions to come to some kind of a consensus.

MR. STEELE: One of the other things that we've been getting confusing messages on is on the issue of public auto, and contrary to what you're saying, Mr. Minister, we're not advocating public auto, that's not what our report said. I know it's what you like to

[Page 261]

characterize it as, but that's not what we said. If you want to see what we did say, then I will give you a copy of our report, and you don't even need to file a FOIPOP request to get it.

MR. RUSSELL: I have a copy of your report.

[11:45 a.m.]

MR. STEELE: I haven't asked you a question yet, Mr. Minister. You said this morning: Public auto is not on our radar screen at the present time, we prefer government not get involved in insurance. In the House on April 2^nd, "Their plan is public ownership of the insurance industry in this province. We've had experience with Sydney Steel, we've had experience with other adventures by government. We don't want any part of that." Later, "Mr. Speaker, we do not intend to take the action as suggested by the New Democratic Party. I can tell you that off hand." Later, April 9^th, from you, ". . . the only solution that he was able to come up with is for the government to set up its own insurance company in competition with the private sector. We do not intend to do that."

Yet, at the news conference where you released this, you said that if there's overwhelming public support for it, we will do it. So let me ask you directly, public auto insurance, is that an option on the table or is it not?

MR. RUSSELL: A publicly-funded system is possible, however, it is not on our radar scope. It's not one of the areas that we wish to go in. Secondly, as I explained to the honourable member for Halifax Chebucto, we can't anyway, simply because of the NAFTA agreement.

MR. STEELE: Well, you're wrong about that too, Mr. Minister, but that's another question.

MR. RUSSELL: Well, in your mind I'm wrong about everything. Well, that's fine and dandy.

MR. STEELE: You're not wrong about everything, but you're wrong about the things you've said this morning.

MR. RUSSELL: What? About NAFTA?

MR. STEELE: You're wrong about the freedom of information agreement, whether you can release Mr. Jordan's contract, and you're wrong about NAFTA. You said, yourself, that if you asked different lawyers you will get different opinions.

MR. RUSSELL: That's right.

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MR. STEELE: And yet you get one opinion - apparently, which we haven't seen yet - from an internal government person, but you say no, that's it, that's law, we have no choice. Is public auto insurance off the table?

MR. RUSSELL: It is not off the table. It's certainly something that will be looked at, I'm sure, by Mr. Jordan. However, insofar as the government - remember that whatever Mr. Jordan comes forward with is going to have to go through a governmental process to put it in place. My advice that I'm receiving from people who supposedly are learned in the law is that at the present time under the NAFTA agreement, we cannot set up a public insurance system.

MR. STEELE: Now, one opinion internally has become several people learned in the law. How many opinions has the government gotten? Does it have one, does it have several? Are these things people say to you on the street? How is the government making public policy here?

MR. RUSSELL: Within government, there was one spokesperson, a trade specialist. There was that one, but I've also received a private indication that agrees with that.

MR. STEELE: Who is the private indication from? Is it from the insurance bureau?

MR. RUSSELL: My private indication is from a friend of mine who spoke to me about 18 months ago, who came to this province, actually, from Manitoba.

MR. STEELE: Are we making public policy based on what your friends are telling you?

MR. RUSSELL: No, I do not, but I listen to what my friends have to tell me and I listen to what everybody has to tell me, and, from that, maybe I get an answer that is not only acceptable politically but is acceptable by the general public. Consensus is a wonderful thing you know, and it operates in most Parties in this province.

MR. STEELE: Mr. Minister, I sure hope that we're not making public policy, especially on big questions like auto insurance, based on what one of your friends happens to tell you.

MR. RUSSELL: The information that I got officially was not from a friend of mine, in fact I don't even know the person.

MR. STEELE: At the news conference you said that you were enough of, if I may say, a canny politician to at least leave the door open, if there was overwhelming public support for it, you would consider it. How do you expect there to be overwhelming public support for something that's not even mentioned in your book of options?

[Page 263]

MR. RUSSELL: I disagree. We talk about Manitoba and we talk about British Columbia and Quebec and Saskatchewan, which are run by government.

MR. STEELE: If I could refer you to Page 3: One of the fundamental principles and assumptions is that a competitive marketplace is the most fair and effective means through which to contain rising insurance premiums. It's a fundamental principle according to the Tories that we can't have public auto, and I would suggest that's why it's not mentioned anywhere else in the document.

MR. RUSSELL: There are such things as combinations, as you're well aware, if indeed we could have a public system, which I don't believe we can.

MR. STEELE: So you're a canny enough politician to leave the door open and say yes, it's possible, but you just can't see it happening.

MR. RUSSELL: That's correct.

MR. STEELE: All right. Thank you.

MR. CHAIRMAN: The time for the NDP caucus has now expired. Now back to the Liberal caucus.

The honourable member for Richmond. The time is now 11:50 a.m.

MR. MICHEL SAMSON: Mr. Minister, good to see you again.

MR. RUSSELL: Yes, last time I saw you I think we spent a number of days together.

MR. SAMSON: I think we did. We had a few years in between that. I don't think we will spend as much time this year, although it's a little early to predict that. Mr. Minister, on the environment side, there was a program known as, I believe it was called a water fee credit program. Basically it was large industrial users who used water such as pulp and paper plants. Nova Scotia Power, at some of the generating stations, were charged under a credit system where they had to pay a certain fee for their water usage. Out of that program, I think half of the money generated from that was given out to community groups. For example, I know we had a couple in Inverness that did some stream enhancement. I know in Richmond County we had the Richmond Wildlife Association that worked on some streams.

A couple of years ago, in fact I believe when you were first minister, there was a significant cut made to the program, and then the year after that I believe the program was completed gutted, in that you kept all of the revenue and there was no longer any of that going to any of these organizations. I'm c