COMMITTEE OF SUPPLY

(Concurrent Sections)

AGRICULTURE

Mr. Deputy Chairperson (Ben Sveinson): Will the Committee of Supply please come to order. This afternoon this section of the Committee of Supply is meeting in Room 255 where we will resume consideration of the Estimates of the Department of Agriculture.

When the committee last sat, it had been considering item 3.1. Administration and Finance (b) Executive Support (1) Salaries and Employee Benefits on page 13 of the Estimates book.

Ms. Rosann Wowchuk (Swan River): Mr. Chairman, I would like to ask a few questions about the expenditures in this section before we move on. One of the areas that I am looking at is under 1.(b) Executive Support, there is a section on Grants.

Can the minister give an indication what these grants are used for and who they are paid out to? Is it grants to different organizations that work within the department? Just some clarification on that, please.

Hon. Harry Enns (Minister of Agriculture): Mr. Chairman, we have a modest grant program within the Department of Agriculture Estimates. They are paid to various organizations that hold conventions or annual meetings in the province, such as the Canada Grains Council, Canadian Grains Commission, Canadian intergovernmental conference secretariat, Canadian Shorthorn Association, Canola Council of Canada, National Chinchilla Breeders Association. We have a policy that provides for modest assistance usually to help out with the luncheon, and they range in the order of $1,500 to, for instance, the Canada Grains Council, to $500 to the Chinchilla Breeders Association. Those were '93-94.

In '94-95, again a similar grouping of different agricultural organizations: Canadian Special Crops Association received $1,500; Entomological Society received $2,000; Manitoba Combined Training Association received $500; Manitoba Junior Hereford Association $500; Manitoba Milk Producers received $1,000 for their annual convention here in the province; Manitoba Seed Growers' Association received $1,500. So these are the nature of the grants that are provided. To date in the year '96 to March 31, '96, three additional groups: Keystone Agriculture Producers Incorporated received $1,000; Manitoba Hatchery Association received $1,000.

Ms. Wowchuk: Can the minister indicate whether there is a criteria that is required to apply for this funding or on what basis the funding is allocated?

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Mr. Enns: The basic criteria is that they are national meetings. We host visitors from across the country and it has to be a national meeting for a certain level of grants. Certain other ones are traditional hospitality grants. There is a hospitality committee working out of the Premier's Office, I believe. It has been a long-standing committee that attempts to provide a base criteria for hospitality grants of this order. These grants are not to be confused with those grants that we have in other parts of the Estimates. For instance, the department also still continues to provide modest assistance to agricultural societies and, I believe, to some of the different agricultural fairs that take place throughout the province.

Ms. Wowchuk: Mr. Chairman, the minister indicated earlier on that he had travelled fairly extensively over the last year to promote agriculture, to promote the sale of value-added products in various parts of the country. Can the minister indicate whether the transportation costs for those excursions show up in this budget and also whether there are several people who travel with the minister and whether the costs for those would show up out of this budget or whether they show up in another place?

Mr. Enns: I can indicate to the committee that the department attempts to appropriately proportion travel expenses of that kind in the appropriate section of the Estimates. If it is a marketing mission, those costs would be contained within the marketing branch's Estimates as shown in these appropriations. For instance, I recall one occasion where I travelled to a western bankers' meeting in Des Moines, Iowa. Essentially the business at hand was of interest to Manitoba Agricultural Credit Corporation, and my understanding is that the appropriate costs of the personnel involved, including myself, were borne by the corporation.

We have a policy of criteria where, as on my last visit to Asia, to China, in particular, we had invited a number of people who had an interest in promoting their products in that market, whereby the department again, in this case, in the Marketing branch, would modestly support airfare only for the head or the president of, say, the vegetable producers organization of Manitoba, Mr. Dave Jefferies, accompanied me or Mr. Wayne Burke, who was the current president of the Manitoba Forage Seed growers association. There were others that joined in the mission as well, but did so at their own expense. In addition to that, it is usual that we have somebody from the department; in some instances it has been my assistant deputy minister, Mr. Donaghy and other agents. The point man that we used, perhaps most frequently, is one of our senior marketing people in the Marketing branch, Mr. Lasby Lowes. Those expenses would, of course, be picked up by the Marketing branch of the department.

Ms. Wowchuk: So then the minister is indicating that in what we have Transportation and Other Operating costs, this would be transportation within the province. On this line, this would not necessarily mean travel on out-of-province missions?

Mr. Enns: Mr. Chairman, staff advises me this appropriation would include my or staff's costs if we were travelling, as we did, to meet with fellow ministers or the federal minister in Toronto. We are looking forward to the national Canadian Agriculture ministers' meeting this first week in July in Victoria, British Columbia this year, for instance, those would be included in that. But as the member has pointed out when I am travelling specifically on a marketing and leading a trade mission, those are appropriately found in the Marketing branch, the travelling expenses and trade promotion expenses.

Ms. Wowchuk: Mr. Chairman, just prior to the last mission that the minister went on to China, there was a trade mission taken by the federal Minister of Agriculture which covered very much the same territory, with the exception of one province, I believe. Had the minister taken part in the federal mission, would the expenses have been covered from the federal government or would those expenses still have been paid by the province?

Mr. Enns: Mr. Chairman, staff advises me that they would have still been our costs. We did receive the invitation. I received the invitation for Manitoba to be represented either by myself or somebody else from Manitoba on Mr. Goodale's mission, and I report to the committee that Mr. Lasby Lowes from the Manitoba Marketing branch was with the federal mission as well.

Ms. Wowchuk: Mr. Chairman, within those other expenditures, there is an asterisk indicating this amount also includes policy studies. Can the minister indicate what policy studies that would cover that his executive support staff has been working on?

Mr. Enns: Mr. Chairman, these are occasions where we will second or hire somebody, usually on relatively modest contracts, to do specific additional work on policy questions. We had hired a Mr. Earl Geddes to help us early on in the year in terms of providing us with some additional information on the Grain Transportation Agreement that led to the demise of the Crow.

We had similarly asked a former deputy minister of the department, whom the member may recall, Mr. J.M. Cormack, to do a specific study on natural gas and where we were attempting to bring together potential developments in the agribusiness sector that could utilize some of the natural gas that currently is not being utilized. It is in several parts of the province of Manitoba. The particular firm that was interested in this was the Can Agra group that eventually did settle at Ste. Agathe, but in its earlier investigations there were particularly interested to sourcing natural gas.

We had also included in this area of additional policy help would be some monies for something like Professor Kraft to help us with the transition committee in the pork question and presented a report to us, conducted a number of meetings with representatives of Manitoba Pork and other stakeholders with respect to trying to assure that we would have a relatively smooth transition from the current single-selling desk to a more flexible marketing situation in Manitoba Pork.

That is the range in terms of length of times from $3,000 to $7,000 to under $1,000, depending on the demands made of these individuals and the amount of detail required.

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Ms. Wowchuk: So there were no special policy studies done either on the proposed elk industry to Manitoba or on the change from single-desk selling to open marketing of hogs? Or with respect to the hogs, would that study have been accounted for in the previous year?

Mr. Enns: Well, Mr. Chairman, the member is very much aware that in my view a fairly significant study was undertaken in-house and out of house. It involved my Assistant Deputy Minister Donaghy. I am not referring to the review of the Manitoba Pork industry conducted by Professor Gilson, Dr. Donaghy and one Mr. Gerry Moore, who is an employee of the Department of Industry, Trade and Tourism. So that study, of course, as the member is well aware, led to recommendations, provided certain recommendations, some of which have been acted upon.

With respect to elk farming, there was no specific outside study instigated. I can indicate to the committee that certainly senior staff and particularly the director of the Animal Industry Branch, Dr. Taylor, invested a considerable amount of his time and effort into pursuing the question before I felt comfortable in making a presentation to my caucus and cabinet that a decision to commence with game farming in Manitoba with respect to the species elk should in fact be taken.

Ms. Wowchuk: Mr. Chairman, I am trying to follow the guidelines here, but I hope you will tolerate all of the questions that I am going to be asking all come under Section 1, but they may stray from (c) to (d) or (e) for a bit.

I want to ask, under this section, I believe last year we talked about the privatization of the Brandon Ag Extension Centre. That proposal was made a few years ago, and I believe it ran into some stumbling blocks. When we talked about it last year it had not actually happened. I believe the food services were privatized and there was some difficulty with that.

Can the minister indicate what the status is of the Brandon Ag Extension Centre and whether it has been privatized or it is still in government hands and, if so, what kind of funds are being allocated to have that facility run?

Mr. Enns: Mr. Chairman, I have to report to the honourable member that there has been really no change in the situation. Government Services is the operating department that essentially has the responsibility for either finding other uses or finding other individuals or corporations or companies that could make use of the facilities. We continue to use the facility as an as-need basis, but no disposition of that facility has been made.

It is my hope quite frankly that we can provide or bring some kind of operation that could continue to allow us and agriculture, particularly in the western part of the province, to utilize that facility. Times have changed, I suppose. Our problem area is the dormitory facilities that are attached to that, the rather extensive kitchen facilities that are attached to that.

We had attempted during the course of the year to interest the Department of Education, Assiniboine Community College, to perhaps use the facilities or some of their training programs that they normally run through the community college system for restaurant and food service and so forth, trying to seek out a continued governmental use, if you like, of the overall facilities. But I have nothing further that I can add to it. What we are still facing of course and what is represented in the current Estimates is our ongoing cost to maintaining the facility in its present underutilized form. We bridle that a little bit because Government Services sets the rent I believe. We in effect pay Government Services for the current usage of that facility. That is what is reflected in these Estimates.

Ms. Wowchuk: What would those costs be for a year?

Mr. Enns: In the order of $170,000 per year.

Ms. Wowchuk: I hope that the minister will consider all possibilities of using that facility. We talked earlier about the recommendations that came from the hog report, the review of the hog industry and the need for education. I am sure he would want to be working along with other facilities that are offering courses such as ACC and Red River College. It is unfortunate that we would have a facility such as that that is not being used to its capacity.

I want to ask a few questions with respect to training and use of modern technology that is available at the present time. Can the minister indicate what is the status of the technical services available throughout the offices throughout rural Manitoba? Have they been upgraded to a level equivalent to what we see in other departments? At the same time also, can the minister indicate what steps his department is taking to provide information that farmers, rural people, can access directly in their homes? Is there any upgrading in the system going on right now?

Mr. Enns: Mr. Chairman, I know that when I visit different ag offices throughout the province, as you would suspect they are introducing more and more technological support, machinery and equipment and computers into their operations. We, I am advised, provide a considerable amount of information to the Internet which then can be accessed by those farmers. There are a growing number of them that have access to it in that manner. We work with other agencies to produce different features in software for computer use. I am advised we do not as such have the capacity within the department to directly transmit information between individual farm people. It is information that we provide or that they come in and work. We have seminars or information that they can pick up off the Net that we have put on the Net.

Ms. Wowchuk: Can the minister indicate what plans his department has for the next year to upgrade or improve computer or telecommunications services throughout the areas where there are agricultural offices?

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Mr. Enns: There are a number of planned activities generally encompassing this area to extend the e-mail capabilities into the northwest and southwest regions. Manitoba Crop Insurance Corporation and AgriculturalCrown Lands Branch are feeding information into this program, continue to help Manitoba Crop Insurance in their implementation of the recommendations identified in the earlier Price Waterhouse operation review, provide guidance and assistance to their migration to open systems.

There is a fairly major change taking place in the Crop Insurance Corporation to bring their whole database and means of accessing and getting information fully into the computer age. We continue various investigations and analyses on how the department can benefit from the new emerging technologies which involves the Internet and the information highway generally. We have had different occasions where we have on a regional basis brought this technology to bear whereby our various specialists can, as I say, enhance the scale and reach of the information seminars that we conduct from time to time in the various disciplines of agriculture.

Well, I can just put a bit more on the record of the kind of things we have, a growing number of what we call marketing clubs. These are usually a group of aggressive farmers, often some of our younger farmers. We have over 100 of those clubs, including 53 grain marketing clubs, 29 livestock marketing clubs, 12 swine marketing clubs and six dairy clubs. We work in the new technology with these kinds of organizations because most of them have the equipment at home and/or meeting places that they come together with. Our whole farm business management information network is a system of 13 computer bulletin boards linked together electronically to share farm management information from coast to coast across Canada.

Winnipeg is the national hub of the farm business management in it, with the system operator located in the farm management section. So this whole field of activity is a growing one. Since August '93 almost 900 users are registered, 400 to 500 use it regularly. Manitoba users have made over 20,000 calls since the project was started in August of '93.

So like anything else, it is gaining, but it also of course is dependent in large measure to what extent the primary producers are themselves getting involved in this kind of equipment and becoming literate and familiar with this kind of equipment, but it is a growing way of doing business in farming and agriculture, as it is in all other fields of life.

Ms. Wowchuk: The minister mentioned that there are over a hundred marketing clubs that are using the system quite a bit. Are these marketing clubs, or is the equipment sophisticated enough that there is direct communication that they can access through the Department of Agriculture?

Are those the kinds of things that are available that are being provided for people who are in, in particular, the marketing clubs? Is there direct communication? Can they link up right to the Department of Agriculture for specific information?

Mr. Enns: As I indicated earlier, Mr. Chairman, we do not have the capacity to link up directly to us, but there are a number of different ways through the Canada system, farm management system, where we have, fortunately, located in Winnipeg kind of the hub of the national system, that they can interchange with the different agricultural interests across the country.

Ms. Wowchuk: Mr. Chairman, Manitoba Crop Insurance, the Department of Agriculture, has very sophisticated mapping plans that are on computer that, as I understand, can identify very closely what crops are grown and can break down things very closely.

Can the average farmer access that information, as well, or is that information only within house?

Mr. Enns: Mr. Chairman, the answer is no, but the member is correct, there is this very sophisticated satellite-delivered service. The corporation and other users, I might say, including institutions like the Canadian Wheat Board and/or private grain companies utilize this information gathering with respect to crop progress in this case.

Ms. Wowchuk: Can the minister indicate, the information that Crop Insurance uses that we have, is it a database that is built up that belongs to the Manitoba government, that belongs to Manitoba Crop Insurance, and then do we sell off?

I mean, if the Wheat Board wants some of this information, is it something that the department has developed that is available then to provide to other people which would be a source of revenue for the department, or does each person sort of develop their own database?

Mr. Enns: Mr. Chairman, I am advised that the member is right. Over the years and on a continuing basis, Manitoba Crop Insurance is forever fine-tuning its database which becomes valuable data to other agencies. Manitoba Crop Insurance is authorized and does from time to time sell information to other institutions like the Canadian Wheat Board which feels it is in their interests, for instance, to have accurate and advanced knowledge of crop progress or various kinds of information of that kind.

Ms. Wowchuk: If you would bear with me, Mr. Chairman, I want to ask, just for clarification, there are other databases, for example, Natural Resources has a database. Is this one database that we are looking at or do they overlap? Does Crop Insurance have just a specific database that deals with crops and the other departments have their own?

Mr. Enns: Mr. Chairman, I am familiar with the operations that the member alludes to that within the Department of Natural Resources it is that one shop that provides that information. It received some considerable federal assistance in establishing the very sophisticated equipment which enables the satellite transmission of some of this data and Crop Insurance buys it from Natural Resources for the kind of information that it requires. If it wants specific information with respect to conditions, soil conditions, moisture conditions, I know that other agencies like the Forestry department of Natural Resources of course, usually commencing about this time is extremely concerned about drought conditions in the forested regions of our province in helping to plan and prepare for potential forest fires.

I am advised that producers can buy summarized copies of this information. It is not that it is secret or something like that. It is just that it is not available in the kind of form that necessarily would benefit the individual farmer. The farmer will come in and see a region, see the southern region and western region of the province, colour coded as they are; the member has seen these kinds of maps. But producers can provide, particularly under the management plus program, this kind of information through the Department of Agriculture.

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Ms. Wowchuk: Can the minister indicate whether it is a fairly expensive service, that if the farmer was looking for this information, is it something that is reasonably priced or is it beyond the reach of farmers?

Mr. Enns: I am prepared to table just an example of the kind of information, crop yield responses to seeding date, information on crop yields, and so forth in the various risk areas that the corporation provides insurance coverage for. It is--just paging through it--different kinds of cropping information which is provided at no cost to the producers. I will table that with the Clerk and make that available to the members of the committee.

Ms. Wowchuk: Mr. Chairman, I appreciate that. I guess what I was wanting to ask as well, the minister says the Manitoba Crop Insurance has this information and when people want it, it is sold off. I am sure that it probably does not show up in this budget, but I am wanting to know, is it a good source of revenue? Do we get a fair return from this investment from other departments?

Mr. Enns: I am advised that it would be accurate to describe this activity as in its developmental stage. It has been pointed out to us, and I believe the Price Waterhouse report that took a hard look at the entire operations of the Crop Insurance, identified this as a future source or a potential source of revenue which would, of course, aid the corporation. It would help in offsetting the administration costs and anything that we can do in controlling administration costs, something like that, of course reflects eventually to the producer in the premium structure that is as advantageous to the producer as a crop insurance can possibly make it.

Any data that is sold is subject, of course, to Manitoba Crop Insurance strict criteria to ensure producer confidentiality. Data has to be aggregated before it can be distributed outside of Manitoba Crop Insurance and Manitoba Agriculture and so there is that concern, the confidentiality of the producer is not compromised in the sale of this data but to some organizations, nationally and internationally, it could be very useful in the formulation of their business plans if they had access to this kind of information that, at the same time, abided by the strict criteria of producer confidentiality.

Ms. Wowchuk: Mr. Chairman, on the technological services, it indicates that there are plans to implement training for information technology. Can the minister indicate is this a need to train staff or is the department looking at any way to provide additional training? Is this training programs that you are looking at to provide for farmers or is it internal staff training that you look at only?

Mr. Enns: Mr. Chairman, I am advised that this line essentially is costs for in-house staff training of our own people as we change from different technologies, enhance the capacity of staff to properly and effectively use the technology.

Ms. Wowchuk: Mr. Chairman, I am wanting to ask one more question before we leave this area. Earlier on, we talked about the importance of research and attracting more dollars to this province. There are fairly substantial amounts of money left from GRIP, I believe in the range of $16 million, and I am told that in order to get research in this province, the province has to be prepared to put money into it before the federal government is going to invest money into research in this province. I understand other provinces are doing it now and that is the reason for the increase in the amount of research that is happening.

Is there any consideration given by this government to look at that money that is in a surplus from GRIP to put it into looking at attracting research dollars? I realize we have passed Crop Insurance, but I hope the minister will consider that suggestion as a way to attract more research to this province.

Mr. Enns: Well, Mr. Chairman, I know that Dean Elliot, Faculty of Agriculture, University of Manitoba, shares the member's concern that she just expressed about finding ways and means to maintain and possibly enhance our research position, particularly when one looks at what is happening in some of the other jurisdictions. I cannot indicate with any confidence at this stage or--well, confidence is the wrong word--assuredness that these additional dollars will be found. But certainly I have no difficulty in acknowledging that we are looking within the Department of Agriculture, I am looking very strongly at the potential utilization of some of those monies that the member mentioned to be utilized for that purpose. There will be a significant pool of money, hopefully, as the final surplus position of the GRIP program, for instance.

The member should be made aware that a policy decision has been made to return the producer's share of the GRIP surplus back to the producers. There may be a willingness on the part of the producers, if challenged, to fully appreciate and acknowledge the importance of research, that perhaps some of that could be used to build up a more significant fund. But at this point in time the likelihood is that the producer's share of the projected GRIP surplus will be returned to the producers.

I am, of course, watching carefully what the federal government is doing with its share of the same surplus coming as a result of the termination of the program, particularly in how they are treating other jurisdictions like Saskatchewan who have significant surplus dollars in their GRIP account as well. My understanding is that a fairly significant portion of the federal share is accruing to Saskatchewan, and I, of course, have made it abundantly clear to the federal people that we expect similar treatment in Manitoba. That could result in a significant pool of dollars that in my opinion could support an enhanced research program. It is my intention to pursue that and I invite and encourage the honourable member's support in this effort.

Ms. Wowchuk: Mr. Chairman, I would encourage the minister in that avenue. If there is close to $16 million of provincial money, and if that can be used in any way to leverage what I believe is close to $28 million in the federal account in the surplus from GRIP then certainly together that could create a very good pool of funds that we could begin to do some of the much needed research that we have to do as we go through this phase of adjustment from changing through the Crow and looking for opportunities for the farming community to adapt and adjust and bring new economic development to Manitoba. I hope the minister will pursue that, and he will certainly have our support on it.

Mr. Enns: Well, it certainly is my intention. At the moment the only person who is seriously objecting to it is one Jeff MacDonald who wants it all for Highways. Other than that, you know, I am going to give it my level best.

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Ms. Wowchuk: Sorry, Jeff, you cannot get it for Highways.

Mr. Deputy Chairperson: Item 3.1.(b) Executive Support (1) Salaries and Employee Benefits $437,000--pass; (2) Other Expenditures $68,300--pass; (3) Policy Studies $71,200--pass.

3.1.(c) Financial and Administrative Services (1) Salaries and Employee Benefits $883,900--pass; (2) Other Expenditures $497,400--pass.

3.1.(d) Information Technology Services (1) Salaries and Employee Benefits $302,100--pass; (2) Other Expenditures $43,700--pass.

3.1.(e) Human Resource Management Services (1) Salaries and Employee Benefits $231,300--pass; (2) Other Expenditures $33,800--pass.

3.1.(f) Less: Recoverable from other appropriations ($15,000)--pass.

4. Agricultural Development and Marketing (a) Administration (1) Salaries and Employee Benefits $128,100.

Ms. Wowchuk: Mr. Chairman, we started to have a discussion on the proposed elk industry in this province and then we left that issue to move over to the issue of crop insurance. I would like to go back to that issue a little bit more and just ask a few more questions on where the department is and what is being proposed. Basically, I wonder whether the minister might be able to table with us any information that he has with respect to the industry and, in particular, I would get back to disease.

Earlier on, back in '91, '92, there was an awful lot of concern about tuberculosis and other diseases that were at a very high rate in Alberta, I believe, and I would like to ask the minister what studies have been done to give the minister the comfort that starting the industry now in Manitoba is not a concern to him.

Mr. Enns: Mr. Chairman, I suppose, in a more general way, the kind of fact-finding mission that I directed, as I indicated earlier, specifically to the director of the Animal Industry branch during the course of the better part of a year, was to fully acquaint himself with the operations of elk farming in other jurisdictions, notably Saskatchewan and Alberta. The knowledge that we have picked up in our veterinarian branch with respect to how disease control has functioned in these jurisdictions, how when incidents did show up with some difficulties, such as the member referred to, the respective authorities responded, I would say, with dispatch. Also, and I have made this point before, we are questioned on that question, you know, what guarantees or what can we do to ensure that disease is not an issue or a problem to our growing cattle industry with the potential introduction of various diseases.

Growing information leads us to believe that in the controlled state domesticated farming of these animals in fact reduces the incidence of possible contamination or a contagion of disease. I cannot, nor can my colleague the Minister of Natural Resources (Mr. Driedger), give the member or any primary livestock producer any assurance about the current level of disease in the 10,000 or 12,000 elk that roam in the wild, along with the upwards to 100,000-plus white-tailed deer and other big game animals.

As I indicated to her when last we discussed this issue, right about now our producers are turning their domestic cattle herds out onto pasture and there is a considerable amount of co-mingling that goes on. There is always a concern. That is why we have in this country, and I applaud people that preceded me and who continue to work in this field, a very sophisticated and some would say expensive system of health checks run by Agriculture Canada have a full health and veterinary section that deals with this issue. Provincial departments of Agriculture are equally engaged in it. We support and maintain diagnostic lab services. We expend a considerable amount of money for the protection, control and, where possible, of course, the eradication of various animal diseases that impact on livestock.

We have been singularly successful in some of the serious diseases that plagued livestock. In my lifetime, brucellosis, which the member knows was a major problem to the livestock industry, has not been eradicated but certainly is a very controlled situation. The same thing applies to tuberculosis, TB. We are constantly concerned about any flare-ups wherever they may occur. I can report to the honourable member that hardly a year goes by that something does not flare up somewhere and that action has to be taken. A herd has to be put down, a herd has to be put on test, put in quarantine, but the mechanics are there to do it. I appreciate the fact that to date we have been able to set aside sufficient dollars both in the Ag Canada budget and in the provincial budgets to maintain this.

You know, when you have the privilege of visiting other countries such as Mexico, for instance, who would dearly love to be able to do more trade in cattle with us and/or particularly with some of the southern states of the U.S., what prevents them from doing it is because they have not addressed the question of animal disease to the point that we have. They do not have free passage into other jurisdictions as we enjoy with our major trading partner, the Americans, or anybody else for that matter.

I appreciate that this is a long-winded response. I simply say that you have to look at venerable gentleman like Dr. Jim Neufeld, who has become the Director of the Veterinary Services in our province, in our branch. You have to look at the support staff that he heads up in that branch. We as legislators ought to make sure that sufficient funds and resources are set aside for that purpose. That is in fact the best guarantee that we can handle these situations as they arise. I do not see, and I have been persuaded, and I was able to persuade my colleagues in government that the introduction of elk farming does not place this overall concern about health safety, animal disease in any jeopardy or in any greater cause for alarm. In fact, we suspect that we will get valuable data, particularly in Manitoba, where, as you know, we are part of elk ranching, the introduction of elk ranching will be from the wild. We will be accessing animals from the wild from which we will get very sophisticated health information, medical information, with respect to the standing of our wild herds.

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Ms. Wowchuk: Can the minister indicate if his staff has looked at Saskatchewan and Alberta, where they have had elk ranching or game farming for some 10 years now and whether you have looked at the numbers and whether there has been a decrease in the incidence, or what is the rate of incidence of disease outbreak? Again I refer back. I know back in '91, '92 there was a bad outbreak in Alberta.

Is this a common occurrence or has there been a decline in the number of outbreaks since there has been domestication? I guess I am looking really at the status of the herds there, whether there is a serious problem with disease within the captured herds or whether that has become quite controlled.

Mr. Enns: Mr. Chairman, the honourable member referred to the well-publicized difficulty that they had. Again, just generally, I am aware--you see, that is why the member will see why a great deal of attention has to be paid to the transportation of animals from where to where and how they arrive here. If we are not absolutely certain, if we do not have full confidence in the integrity of the scale of control that is in a particular jurisdiction, we will not allow those animals to come to the province. Where the difficulties occur, in the Saskatchewan, Alberta experience, has been in the importation or not having the rules quite up to speed and allowing the importation of animals from a jurisdiction that then moved that disease into their herds. That, of course, is the concern by those who continue to express concern about that.

We, for instance, have in broad policy statements already let it be known, we will not permit animal imports from jurisdictions that we have any reason to be nervous about. That includes the United States right now. The TB infected animals that plagued the Alberta program were brought in from the United States. As I said earlier, we feel, with increased confidence, that we have had the advantage of learning from some of the mistakes that some of these jurisdictions made and some of the difficulties they ran into by carefully assessing, you know, what the problems were and by the advice that we are getting from some of these sources. So we have developed a pretty sophisticated protocol about how animals will be approved, for instance, with specific diseases, brucellosis, certified for movement by Agriculture and agriculture food centre under transportation permit prior to introduction, tuberculosis, certified for movement by Agriculture and Agriculture food Canada. Ag Canada plays an extremely important--and it is our intention to lean heavily on Ag Canada to help us in the enforcement of these protocols having to do with safeguarding the animals health.

Ms. Wowchuk: Mr. Chairman, the minister refers to the Department of Agriculture, and there is a compensation program that is in place when cattle have to be put down or horses have to be put down for disease. I understand that there is also a compensation program in other provinces that is covered, if they have to be put down, for elk. Can the minister indicate, when there is this compensation, whether the province has any share of it or the costs are borne strictly by the federal government and what the compensation rate is for cattle and elk?

Mr. Enns: Mr. Chairman, it is a federal program, totally federally supported, and, at this time, there is no provision for a provincial input and/or coverage for elk at this time.

Ms. Wowchuk: Is there for cattle?

Mr. Enns: For cattle, not provincial, just federal.

Ms. Wowchuk: Mr. Chairman, when the announcement was made to start elk ranching, the minister indicated that it was--I have not got the announcement right here, but there was discussion about, part of the industry is to provide meat, and the other part of the industry is for the sale of antlers. At the time, I tried to get some information from the department from various people as to the purposes, the uses for these antlers. I understand that they are shipped. The market is in Europe, and there are some limited purposes for it, but I have not been able to get any information as to any documents that will tell us. What market are we accessing, or what is the purpose of these antlers? Is it medical purposes? I hear various things, so I would like some information, and if the minister could provide us with something I would appreciate it.

Mr. Enns: Mr. Chairman, firstly, I think although the act will anticipate that there will be some movement of meat, so there will be a provision dealing with the meat processing in the act. But let me be very clear, in the first several generations or decades of the program, the value in the business lies in the breeding stock and the sale of velvet, and there would be very limited actual movement into the meat trade. But, you know, that is something that is certainly down in the future, just as in other nontraditional animals that have been introduced to agriculture whether it is ostrich or emu, or bison that takes a number of years before prices come down to the point where they could be considered making any significant contribution to the meat trade or the meat industry.

Velvet antler usage is attractive. It is exported to different parts of the world, but particularly, of course, the Asian part--Korea, Taiwan, Hong Kong, China. It is used extensively for Oriental herbal medicines. It is eaten as a delicacy. It is brewed in teas. It is used in herbal wines and elixirs.

(Mr. Gerry McAlpine, Acting Chairperson, in the Chair)

They claim--and who are we in Canada to take issue with them?--that it increases the blood flow and volume, improves growth of young children, eliminates anemia, promotes rapid healing, tissue regeneration, arthritis treatment, relieves lumbago, improves weak bones, treatment of aftereffects of paralysis, sciatica, neuritis and shoulder pain.

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I am just delighted that I am joined by my colleague from Sturgeon Creek who I know is well learned in these matters, being somewhat of a herbalist himself, and has on occasion conned me out of $160 to $170 to buy some of his medicines.

Menopause and menstrual disorder treatment, treat kidney deficiencies, and, of course, impotence also is listed. But it is a misconception and a myth that generally speaking we only hear about its use as an aphrodisiac. In Eastern medicine, it is used very extensively. It is based on the philosophy of yin and yang, opposite forces which govern everything in the universe. Health in human involves balance of yin and yang. Illnesses are caused by imbalances. To bring a body back to balance, various herbs and medicines are taken, and that is what really drives a virtually insatiable demand for the velvet.

I am advised by staff who have investigated this on the field that a set of antlers will return to the producer between $1,200 to $1,500 per annum. It should be noted these antlers fall off in their natural state of nature every year, and so the harvesting of them, in my opinion, ought not to be considered as unusual or exploiting a portion of the animal that drops off naturally every year. If producers in Saskatchewan and Alberta are turning this into a very attractive economic activity, why ought we not to make that available to Manitoba producers? I might also say that in different parts of Canada, notably I believe Alberta and Ontario, we are processing the velvet into various forms of medicinal uses, pills, powders and herbal teas.

Ms. Wowchuk: Mr. Chairman, I would like to ask the minister if the Department of Agriculture is going to control the sale of antlers. For example, is this going to be centrally controlled where they will be handled through one facility, and does the minister have the confidence that the system will be set up in such a way that we will not have antlers from nondomesticated animals getting into the system? Could he clarify how his department proposes to dispose of these antlers, and under which department's jurisdiction this will be?

Mr. Enns: Mr. Chairman, the honourable member correctly points out and draws our attention to very legitimate concerns that people have, that by allowing in one set of circumstances, you know, the commercial sale of, in this case, antlers--but the same can be said about elk generally--that how will the Department of Agriculture, how will the government, be able to manage the illegal access to the same products? How will we determine if these products are put on the marketplace whether they are acquired properly from an established elk farm or indeed poached from the wild? I can tell the honourable member that, again, the experience that we have gleaned from the other jurisdictions who had a 10-year head start on this program, that is why there is a very tightly controlled, very sophisticated system of controls whereby, as I indicated, each elk in itself will be personally identified and inventoried, not just a metal clip in their ear, but by a DNA test. That same number or identification has to be carried through each time a set of antlers or velvet is sold from that animal and so identified.

The penalties are--and when the member sees the penalty section of the bill she may be shocked because the penalties are extreme. Would-be practitioners of anything illegal in this business better be very careful because they stand to lose their farm, they stand to lose their investment in elk if any product moves that cannot be accurately traced exactly from where that product came. That animal has to--the elk and the velvet or the antler has to be, we have to be able to marry it up through our identification to an animal that is properly identified as a bonafide registered animal on a registered elk ranch. Of course, we are training staff, you know, to be able to carry this out. I think one of the benefits that we have is that we can and have access to those other jurisdictions that have allowed this for the past 10 or 12 years, and we find out from some of their initial mistakes. We really believe that we can introduce a program in Manitoba having benefited from the earlier trials and errors that some of the other jurisdictions which started this program 12 years ago which did not foresee all of the problems but now have experience that we learn from.

Ms. Wowchuk: Does that mean that all antlers will be sold through a central agency, or will the individuals be able to make their own sale agreements?

Mr. Enns: What it means is the only antlers that can be sold have to carry the appropriate identification.

Ms. Wowchuk: Can the minister indicate whether there is going to have to be additional staff hired as veterinarians who will be monitoring the whole industry and doing the tabulating and numbering of all of this whole business?

Mr. Enns: Mr. Chairman, staff advise me that certainly in the start-up phases we have the ability to do it ourselves, and there is also provision available, will be made in the act, that we can hire additional inspectors.

As I have indicated on other occasions, the program will be self-sustaining. We expect the costs will be recovered, whether incurred by staff or by the requirement, if need be in the future, for additional inspections and the accompanying renumeration that would have to follow.

But let me be very clear, we are talking about an industry that within a very few short years has mushroomed to a 60-, 70-, 80-million industry in neighbouring Saskatchewan and Alberta, and there is no reason why that should not happen here in Manitoba.

It would certainly be an appropriate direction for the Department of Agriculture whose program it will be, to be involved in it, to provide support just as it does for another agricultural program. I suspect that if my expectations of the elk-farming opportunities are realized, then it is a given that there will be some additional time and staff required to maintain the integrity of the program.

The issue will always be a little different than with nontraditional animals, say, like beef. We do not have that same set of circumstances where society on the one hand demands that a healthy herd be maintained in the wild, that the two are absolutely separate and that the general public has confidence in our ability to maintain that degree of separateness.

Ms. Wowchuk: There are several issues, and I am sure that we will see this when we get the legislation, but I want to ask the minister if his department has looked at distances that elk ranches will be able to be established in proximity to what is an existing herd or a natural habitat.

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Are there going to be guidelines in place that say that, for example, you cannot have an elk ranch within so many miles of Duck Mountain or Riding Mountain Provincial Park? How are you going to ensure that we do not have that close proximity, or does the minister believe that there is any concern that we should be concerned about having a domesticated herd in close proximity to the wild herd?

(Mr. Deputy Chairperson in the Chair)

Mr. Enns: Mr. Chairman, I think it would be fair to say, and constantly remind ourselves as we discuss this issue, I have no difficulty and I appreciate the opportunity of discussing this new venture into livestock agriculture in the province, but the act has not been passed, the regulations have not been totally, certainly, formulated. Issues like this, which we are well aware of, have been raised and are raised. I might indicate to you that we do not intend to put specific restrictions in place. We are talking about such things as minimal size, perhaps 10 acres to start off with. We are talking about that they ought not to be on Crown lands. Those kinds of issues.

I have a difficulty if we begin to, even to ourselves, suggest that well, you cannot put them within proximity of a park or a natural area, that we do not have faith and confidence in our own control systems. I appreciate what the member is driving at, that an elk ranch within the proximity of say a provincial or a national park that has abundant herds in the wild, that that is an invitation to increase the herd through the back gate or that kind of thing, but if I begin to believe that, then I start to lose faith in all the rest of the program that my staff are telling me that they can, in fact, impose and control and maintain in the system.

Ms. Wowchuk: Mr. Chairman, I look forward to seeing the legislation and discussing this further. I wonder if I could revert back a bit to when I talked about the various uses for the antlers. The minister read from a document, and I wonder whether he would be willing to table that document, if that would be fair to ask for? The other question I have is can the minister indicate whether--I assume it would be in this department that we would know--[interjection] Can you table that document?

Mr. Enns: Mr. Chairman, what I am going to do is, but that is not at this moment, I am going to ask the director of Animal Industry Branch, who I know has put together different information that contains this and additional information. It is certainly in the interests of an informed opposition and an informed general public, hopefully, about having this information, and I would be more than pleased to ask Mr. Taylor, perhaps as early as tomorrow or the next day, to have some of that information without totally deleting his book. I have no difficulty in having as much of this information, most of which is public, made available to the honourable member.

Before we leave the subject, allow me to just once again remind the honourable member that I genuinely look forward to her having an understanding and a hard look at the opportunities that this program may offer to some of our aboriginal communities, of which she has a number of them in her constituency that have expressed an interest in elk ranching, because I look forward to an opportunity of the Department of Agriculture, perhaps in a more meaningful way, working with the aboriginal community in helping to establish viable, economic livestock ventures.

Ms. Wowchuk: Mr. Chairman, I am not looking to drain the minister's staff's book of all the information. I do have a lot of information on the industry, but it is that particular section that I have been trying to get more information on. If the minister could offer us that, that would be very helpful. I want to ask the minister--

Mr. Enns: I note that the member is making notes. I can assure the honourable member that before the day is out she will have the entire philosophy of the yin and yang and all the other little things about elk farming.

Ms. Wowchuk: Mr. Chairman, I would like to ask the minister if he can indicate whether his department spent money on the two sites that have been set up, one in Grunthal to hold the female elk, and there is a site set up at Pine Creek to hold the male elk. Can the minister indicate whether funds were expropriated from this department to cover the costs of the fencing and what are the ongoing costs to the department to maintain that herd?

Mr. Enns: Allow me to make it very clear that the Department of Agriculture will be solely responsible for the operation of the domestic elk farming that will commence when proper legislation is in place and regulations are passed. Any activity part of that is solely the responsibility of the Department of Natural Resources. It is my colleague the Minister of Natural Resources (Mr. Driedger) who has the responsibility of the care, the housing and the managing of the animals that have been taken into captivity.

Yes, certainly, we notice that he is going to be sending me the bill for it, but at the present time the operation is being carried from Natural Resources, and of course we are starting to incur expenses as well. We believe that we will have, by next year we are off and running, maybe overall expenses of some $180,000, $185,000, which partly will be offset along with the costs engaged in the housing of the animals this year. In '95-96, we have some $300,000 indicated, earmarked in the Department of Natural Resources, with about $60,000 in the Department of Agriculture.

All of these monies we have indicated to our Treasury will be recoverable from a 50 percent share of the proceeds of the sale of the animals. The indications to date, and these again because this is all speculation at this point, but that we have indicated to our Treasury Board that with 50 percent of the proceeds, both the Department of Agriculture will be able to cover its costs involved and the Department of Natural Resources will recover its costs plus be able to contribute significantly to what they would like to establish as an elk enhancement fund where they can do some of the needed work.

The honourable member mentioned the other day the habitat improvement in the areas where the elk belong, in the parks. It may mean some judicious clearing of some habitat, some additional provision of feeders in future difficult winters that would keep more of the elk in their original habitat rather than have them come out on the farm landscape and cause the big game damage that we spent some considerable time yesterday talking about. The sale of these elk will give the Ministry of Natural Resources some of the dollars to do that. If we run those programs as intended and they bear results, I am convinced that the issue that is between the kind of legitimate person who opposes elk ranching that says we are doing this at the expense of a public good, namely, the wild elk herd, in fact, can be debated, that it will be seen that this is in fact not only aiding individual farmers as they establish domestic elk ranching but also aiding the public herd in the wild through this elk enhancement fund. The other 50 percent of the proceeds goes directly to my good friend and colleague who I know the honourable member for Swan River has such high esteem for, the Minister of Finance (Mr. Stefanson).

Ms. Wowchuk: Mr. Chairman, one last question on this issue. When the minister was in his previous department, the Department of Natural Resources, I believe he brought in legislation which made it illegal to sell animal parts and now with the antler sales, will that legislation have to be amended? Does this sale of animal parts now open up for the sale of other--I realize we are going back to another area--but I am wondering if it is going against an act that was brought in a few years ago that said it was illegal to sell animal parts and now we are bringing in an industry whereby we will be selling animal parts.

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Mr. Enns: Mr. Chairman, the honourable member for Swan River has found me out. One of the penalties that you pay if you hang around this place too long--it is true that I was privileged and pleased to introduce to the Manitoba Legislature a specific act that prohibited the sale of animal parts. That act will now have to be amended, I would think. But it is an act that specifically was general in its application partly because we are attempting in the case of elk, with growing difficulty when you had commercialization of elk legal in all other jurisdictions, Ontario, Saskatchewan, Alberta, to have the wildlife officers properly control the illegal poaching of these animals and/or some of their parts.

We now believe--and certainly if you speak to the people in the Department of Natural Resources who, as the member is fully aware, are not in all instances enthusiastic about the program, they will acknowledge, the enforcement people will acknowledge they believe that there will be a far better measure of control exercised on the illegal trade and business with respect to elk as a result of the introduction of this legislation. So the slight revision that needs to be made, there are several amendments that I am not fully privy to but that my colleague the Minister of Natural Resources (Mr. Driedger) will be bringing forward that have to act in tandem to the legislation that we are bringing forward.

Ms. Wowchuk: Mr. Chairman, I think that we will leave that section for now and I want to move on to other areas in the livestock industry. Of course, we have talked about the livestock industry facing difficulties with the reduced return that cattle producers are feeling right now and something that, I am sure, cattle producers did not expect. I remember meeting with the Manitoba Cattle Producers Association a year ago and they were anticipating that there was lots of growth for the industry in the province and there were really good markets that could be accessed. They had anticipated getting a good return for their product for some time now. However, that has declined.

I wonder what plans or whether there are any plans in place to help the livestock industry out. Have there been any discussions with the Cattle Producers Association, or other organizations, as to the difficulties cattle producers are facing and what steps the government, if any, is taking to deal with this problem?

Mr. Enns: Well, Mr. Chairman, I know that certainly for many, many cattle producers this current very serious drop in prices is being felt very, very severely, particularly when it has been put together with one of the longest and harshest winters that we have had that made the expense of raising cattle even that much greater. I hear this directly from my good constituents who happen to be brothers to the member for St. Boniface (Mr. Gaudry), and as I have indicated on other occasions, I have experienced it myself in a personal way as a modest cattle producer myself. I did not want to accept the price for last year's calves so I still have them. They are coming back out on the grass this year along with this year's calves. This year's price is not any better. Indeed, it is likely going to be somewhat worse. In the meantime, we have all put in a lot of feed.

I think this is good tonic for somebody like my friend and colleague the Minister of Labour (Mr. Toews) to have an appreciation for in attending these Agriculture Estimates when we talk about signing contract agreements even with our esteemed public service at zero increase or with our Teachers' Society who feel that 2 or 3 percent increase is not enough. They should try the business of high risk agriculture or farming where 30 or 40 or 50 percent decreases are in fact being experienced. Cattle producers in the province of Manitoba are having their incomes cut by a minimum of 45 percent and their costs are going up at the same time and these are the same people who are being asked to pay their taxes, nonetheless, or pay their leases to maintain themselves in business. So I have a lot empathy for what the honourable member is saying.

We have no specific support programs in mind nor have any been called upon by the industry. We have called upon, in the first instance, our own credit lending institution, the Manitoba Agricultural Credit Corporation, and have asked them to examine whether and where they can back off somewhat in some of the cattle loans they have that are in trouble, perhaps. I know they are doing that where they will be satisfied with less than the full payment required, perhaps interest only for the year. We have asked again through the same offices to get that message through to some of the credit union private lending institutions that they ought to have some empathy for the situation but, in the final analysis, the only hope will be that the market will recover. There are those experts who believe that this may not be a long trough, and I am hoping that they are right. Certainly at the onset of the virtually overnight escalation of feed costs have brought this on to some extent. It has translated very quickly back to the cow-calf operator in the first instance because some of the feed lots, having been accustomed over the last number of years to buying feed grain at $1.80 or $2 a bushel, rebelled at paying $3.80 and $4 a bushel for it, and some of the feed lots did not fill up in different parts of the country and the U.S. the way they normally do. That immediately reflected back on calf prices.

I can only share the honourable member's concern. We will do our best through extension and support work, try to help the cattle people through this difficult period.

Ms. Wowchuk: The minister indicates the possibility of shortage of feed and the delays that farmers, the difficulties they are facing, because of increased herds that they are carrying over but also the delay in pasture and shortage of feed as well. I probably missed the line where I was supposed to ask this, but is their a program in place to help farmers move feed?

Mr. Enns: No, Mr. Chairman, there is no program in place to do that. We have assisted some, a very small number of farmers that qualified under some flood programs under the disaster board, where hay actually was damaged and it could form part of the claim with the replacement of some of that hay, but there is no formal program of freight assistance in place for the movement of hay.

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Ms. Wowchuk: I understand there used to be a program. Can the minister tell me was that program discontinued some time ago or was it just in the last couple of years that that discontinued?

Mr. Enns: We continue to provide a service. I am told it is quite valuable to many producers where we make information available. Farmers, ranchers, that have hay available catalogue or let that be known to our various Ag offices. We on a regular basis then have that information. When we hear of inquiries or farmers, ranchers that are short of feed can get this information from us. We help facilitate the sale between two parties in this way. But there has not been a freight assistance program available since some time now. I would have to ask staff. About '89, certainly not during my tenure of office, now that I have been back in the last three years.

Ms. Wowchuk: Thank you for clarifying that because it was my understanding it was much more recent than when we checked with the Department of Agriculture. Just this spring they said, no, it was not there anymore, so I am pleased that the minister has cleared that up.

I want to ask the minister what is happening with livestock dealers' licensing and bonding that has been a concern with cattle producers for some time. There have been a few instances where a few years back where producers ended up selling their cattle and then not getting the money that was coming to them. Can the minister indicate whether any further steps have been taken to ensure that we do not have this kind of problem in the province?

Mr. Enns: Mr. Chairman, firstly, I can report to the committee that, you know, fortunately, we have had no incidents reported to the department of difficulty in this last calendar year, and I am pleased to be able to report that. I am fully aware that, regrettably, that in the past has happened on occasion.

You know, we have a problem of providing a reasonable level of bonding, and it is the bonding requirement that really comes into play here that offers the protection to the producer. Cattle are sold in a wide variety of ways throughout the province of Manitoba, and a consistent demand for a bond that is beyond the level that a particular auction mart or cattle buyer can afford simply puts him out of business, and that is not providing a service to the cattle industry as well.

The member ought to be reminded that last year we passed legislation in the checkoff legislation for the Manitoba Cattle Producers organizations. Among the goals and objectives of some of the programs that the cattle producers wanted to offer in the utilization of some of the revenue generated by the checkoff was to offer, you know, if acceptable to their membership, kind of a topping off of some of the bonding requirements. To my knowledge, that has not been undertaken or done at this point in time, but I just point out to the honourable member that that is still a possibility that could take place.

There are ongoing efforts made to provide kind of uniformity across the country for the licensing requirements, and for the bonding requirements, that an interprovincial licence would have effect in different jurisdictions. Cattle do move from this province in fairly significant numbers to other jurisdictions, and all of this has to be considered.

The western Premiers at their November meeting endorsed the formation of a western livestock inspection committee which, hopefully, will help in the following objectives: to standardize licence security levels; to provide the same standardization in the vendor security beyond the licensing requirement; to enact interprovincial licensing and bonding reciprocity so that it does not matter if a Saskatchewan or Alberta or Ontario party may be in default, that there will be reciprocity within the bonding arrangement; standardize inspection procedures; standardize fees and collection procedures; reciprocal database access; and the coming possible introduction of electronic ID and inspection as alternatives to future identification of cattle. Those are some of the things that staff advised me were discussed at the Premiers' meetings last in November of '93, and that work is progressing within the various livestock branches in the different provinces.

Ms. Wowchuk: Is the Manitoba department doing any work on the electronic identification of livestock, and when do you anticipate that kind of technology will be available?

Mr. Enns: Well, if you ask my livestock director, he would give you one answer, and if you ask the minister, I will give you another answer. He wants it now, and I keep telling him that I have to convince otherwise I-am-from-Missouri type members of the House, like the member for Swan River is and my friend Clif Evans from the Interlake, it is coming upon us. In fact, it was--to not be facetious about it--we are working diligently on some fundamental changes to the animal livestock, animal husbandry act, and it had been the intent of the department to have that maybe available for this session. It is not quite ready yet. One of the issues is the identification issue. I am well aware of the concern expressed on this issue by the Manitoba Cattle Producers Association officially to me, and I suspect that when next we meet we will be in a position to deal with that legislation.

There is the added impetus I am told. I am advised that an important market, for instance, like the United States might make that mandatory for us to tighten up or to regulate our identification process. There are issues that put us at odds with Saskatchewan and other auction marts when our cattle move in and out there. It is difficult to maintain the same kind of reciprocal inspection services when we have not enacted appropriate legislation to cover those things. So nothing is being done this year, but it is certainly being looked at. I think it is fair to say it is being looked at in a very active way.

Ms. Wowchuk: Mr. Chairman, last year, I believe well over a year ago, there was discussion about the growth of the PMU industry and regulations of the PMU industry. At that time it was announced, I believe by the Minister of Industry, Trade and Tourism (Mr. Downey), that we would be looking to establish an all-party committee to help promote and work along with the PMU industry. Has the minister taken any steps to establish that committee, because to this date we have not heard anything about it, although there was an announcement of it. If so, what does the minister see as the role of that committee?

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Mr. Enns: Mr. Chairman, I have to indicate to you that, no, nothing has been done, and perhaps it is appropriate that we discuss just briefly that something should be done.

We, in Manitoba, certainly in Manitoba Agriculture, believe very strongly that it is a most legitimate agricultural enterprise that some 300 of our producers are engaged in, in the province. It is in the main returning, you know, healthy economic returns to those engaged in the business. But as the member and other members will be well aware, it is an industry that continues to be under strident attack. It troubles me greatly that that is occurring and, I quite frankly, spend more of my time than I should in responding to letters coming to us from all parts of the world, principally by people who are far removed from the scene who do not realize that in agriculture the PMU mare is probably the best looked after animal that we have in agriculture.

I will not attempt to justify past practices that may not have been as cognizant of the welfare of the animal, in this case the horse, as ought to be, but as the member for Swan River (Ms. Wowchuk) is aware--the member for Interlake (Mr. Clif Evans) is well aware, as the member for St. Boniface (Mr. Gaudry) should be well aware, and if the Minister of Labour (Mr. Toews) wanted to become well aware, he could become well aware--of the fact that it is a pleasure to walk into a PMU barn, particularly on a kind of winter night that we have experienced so many of today, to see how well the animals are housed, and to see how well they are being maintained.

I simply refute absolutely the kind of charges that are being levelled at the industry. It is a major value-added industry in the province of Manitoba, providing millions of dollars of economic well-being to the province, not to speak of the producers themselves, and I for one cannot--and I take my colleagues in the medical community to task because that is where most of the effort is being targeted by the animal rights group. The doctors are saying, do not prescribe this terrible medicine because it is coming from these horses that are being abused. What this terrible medicine is, is an organic substance. Surely, we are becoming more and more concerned about the amount of man-made chemicals that we ingest, and all medical reports indicate that it is one of the best products for the purposes it was designed for.

I am absolutely delighted that my colleague, the Deputy Premier (Mr. Downey), has joined me at the committee at this stage, because I know he feels just as strongly about the future and the survival of the PMU industry as I do. So the suggestion that the honourable member raises that perhaps we should constitute an all-party committee to put this issue to rest, I would certainly welcome that. I think that is a suggestion I am prepared to take much more seriously than--I know the issue was, the question was, it was talked about briefly a year ago about this time last year, but that all-party committee never really developed. I think all of us had hoped, you know, that reason would prevail and that perhaps they would get on to some other subject and leave the PMU mares alone, but that simply has not happened. So I will undertake to have discussions with my colleagues, and I would seriously consider. It is a $100-million industry worth our attention; of that there is no doubt. Thank you, Mr. Chairman.

Ms. Wowchuk: Mr. Chairman, I raise it because it was a discussion we had had. It was a commitment that the Minister of Industry, Trade and Tourism (Mr. Downey) said he was going to implement. I think it is a very important committee, and I think it is a very important industry to this province, one that is many times misunderstood, and I look forward to working along with the Minister of Agriculture and other people who can help us promote the industry in any way that we can.

Under the line of Animal Industry, again we have a line of grants of $100,000. Can the minister indicate to us, is that similar to the line that we talked about earlier where monies were allocated for interprovincial trade or national conferences? What would the money in this section of Animal Industry be used for?

Mr. Enns: I am advised that in this instance that is actual program support for the dairy herd improvement program that is an ongoing function of the department through which we continue to assist in the ever-increasing intensive management of our dairy herds.

Ms. Wowchuk: Mr. Chairman, under the Veterinary Services branch, we have a vet science scholarship fund. It was legislation changing the vet science scholarship fund.

Can the minister indicate why it is necessary at this time to change that legislation? Is it because there is need for more funds, or what is happening here?

Mr. Enns: Mr. Chairman, I do not believe the member was present when I provided second reading to the bill. There is legislation that we will be dealing with with respect to the veterinary scholarship program. It does several things. It reaffirms, first of all, our continuing support. We provide and we have access to X number of spaces. I believe it is 12 at the Western College of Veterinary Medicine in Saskatoon. What our concern has been and we try to address in the bill, it is not a major bill, is that the amount of support is in today's terms too low. The intention is to increase the amount available for educational support.

We also want to tighten up through this means the opportunities of having graduating students remain in rural Manitoba. There is a provision in the legislation that if they do not remain in Manitoba, then they must pay back the scholarship monies received in the course of their education. If they stay for a period of time, and I am looking to my friend the director of the Veterinary branch, I believe it is for five years, if they practice for some five years in the province, then that is a grant. In fact, the loan is forgiven. There are some other little wrinkles, like to be able to have capacity to charge interest on those who choose not to practise in Manitoba. They must pay back with interest any monies advanced in furthering their veterinarian education.

So the amendments are made simply to bring up to date with respect to the level of support, to acknowledge the ongoing need. Regrettably, there is still a shortage of veterinary services in rural Manitoba, particularly in the large animal category. Veterinarians, like other professions, like to live in the more urban centres.

I suppose, I do not know for certain, but I suspect that we probably are in pretty good shape in communities like Winnipeg or Brandon in the small animal care, but at three o'clock in the morning--well, I had better not mention her because that is my favourite cow--when she is in trouble, then I need a veterinarian to come from Stonewall or from Lundar. It is important for the industry to have that kind of support.

Of course, as we diversify into the various forms of livestock, whether it is big birds or whether it is bison or whether it is wild boar, the need for large animal veterinary services is not diminishing in Manitoba. The amendments that I introduced I hope in a modest way to encourage that from happening.

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Ms. Wowchuk: Earlier the minister talked about the PMU industry and the need for people to understand that animals are treated humanely. Unfortunately, there are always cases where we do see animals that are treated inhumanely and we hope that the department has the teeth in its legislation to deal with this.

Can the minister indicate how many incidents there have been reported of inhumane treatment of animals in the province and how many of those resulted in charges?

Mr. Enns: Mr. Chairman, again, and I do this in a very understanding way, I know that the honourable member was engaged in another activity when I was doing second readings in the House, but we have also presented to the Legislature a new Animal Care Act. That act will I think considerably indicate our commitment in the Department of Agriculture that appropriate and proper care of any animals, whether they are used in agriculture or just companion or pet animals, that we in Agriculture certainly understand the general concern as expressed by the public.

Some of this is specifically directed to the pet animal situations arising, the honourable member will recall, out of the kind of puppy mill situation of a year ago or several years ago. I had a committee providing valuable assistance that involved people from the Humane Society and from the different livestock or dog breeder groups along with municipal people to see how we can bring into play more appropriate legislation for that purpose.

On the second part of the question, regrettably, again, the severity of this winter and perhaps in some instances the feed shortages or difficulties or producers just not compensating for the additional feed requirements of some of the animals, that we have had more than I would like to report of incidents where cattle were diagnosed as dying from malnutrition, not sufficient bedding or drinking water available upon inspection when we were called out to inspect these sites.

We have seized a number of cattle. We have seized a number of small animals, 129 dogs, and all have been adopted out to private owners, I can report with some satisfaction. We have on record some 25 cows, 12 calves, six pigs that were seized, five cows and a pig that died, two more calves died while being held for auction. So there was more activity than I and I know the member would like to have seen this past winter in this area.

Ms. Wowchuk: Under the existing legislation that is there, does the department have the ability to find people when they are caught treating animals inhumanely, or, if there is not that kind of teeth in the legislation, will the new legislation address that?

Mr. Enns: Mr. Chairman, when we feel--and, obviously, it can be proven in a court of law--that willful intent was involved, criminal charges can be laid under the Criminal Code and fines of up to $1,000 can be levied.

Ms. Wowchuk: One situation that stands out in my mind is the incident with the--the minister referred to the incident of puppy mills that took place I believe last spring. Can the minister indicate whether that whole issue has been resolved and whether any charges and fines were laid, and whether that operation is completely closed down?

Mr. Enns: I am advised by staff that in fact this particular operator faced two charges, one dating back to '93 for which he was convicted and $1,000 fine was levied. The most recent one to which the member alludes to, the outcome is still pending. A second charge from March 1995 inspection is still pending. It has not been concluded or dealt with.

Ms. Wowchuk: Is the operation closed down until such time as that is dealt with or is it still operating?

Mr. Enns: I see by the affirmative nod from my ever capable and efficient staff that the operation did indeed close down. Furthermore, a prohibition was placed against that party from keeping dogs under similar circumstances for a period of two years.

Ms. Wowchuk: Mr. Chairman, with respect to the budget under Vet Services, again, I want to ask about Grant Assistance. Are those the funds that are set aside for the various vet boards or what are those funds for $467,000 for?

Mr. Enns: Mr. Chairman, the principal amount of some $444,100 are provided in the annual grants to the Veterinary Service Districts which assist the Veterinary Service District in maintaining their residential veterinary services. We have some 29 or 30, I believe--28 at this time. One of the districts closed down, and I believe there is another one in the formation stage at this time or wanting to be in the formation stage in the Boissevain area. Other more lesser amounts include $7,800 for the Veterinary Science Scholarship Fund which we just talked about a little while ago. That, by the way, produces support to a maximum of $750 per year for up to four years, which may be written off at the rate of one-fifth per year, you know, if the party is in rural practice. I think those amounts in terms of today's tuition costs, we are finding it not attracting too many would-be veterinarians, and we want to considerably enhance those costs. But that is subject matter that we will have an opportunity to debate when we redebate the bill at committee.

The other amount of monies under this grant is for $15,000 veterinary infectious disease organization. It provides assistance in animal disease research pertinent to Manitoba livestock populations. Those are the monies.

Ms. Wowchuk: Mr. Chairman, the minister indicated $15,000 for a veterinarian infectious disease organization. It provides assistance in animal disease research pertinent to Manitoba livestock populations. Can the minister indicate where these people operate out of? Is that at one of the universities, or where do they do their research?

Mr. Enns: I am advised that this is support money for research done at the University of Saskatoon, partly in association with--they have the veterinary college there--the Western Veterinary College there.

Ms. Wowchuk: Then here in Manitoba, there are no capabilities of doing the research for veterinarian studies on livestock diseases?

Mr. Enns: I think it would be fair to say that our efforts in our own lab carry out various diagnostic services that different aspects of the livestock industry call for, but we do not do that kind of research.

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Ms. Wowchuk: I want to ask about the diagnostic services in a minute, but I want to ask the minister, if we provide grants to the University of Saskatchewan for research and diagnostic testing on infectious diseases, are there any services that we provide here in Manitoba, reciprocal services, that Saskatchewan would fund here in Manitoba?

Mr. Enns: Staff advise me that on occasion, on specific programs, we access their funding that may be available from federal or other private sources and the provincial Saskatchewan source for program work done here in Manitoba.

Ms. Wowchuk: I guess that would tie in to what I had said earlier about the need for more research in this province. If we could capture some of those dollars that are left over from GRIP and work towards developing some additional research, perhaps then we can have some additional work done in this province. Of course, additional work leads to additional jobs. I hope that we will pursue that a little further.

With respect to the diagnostic labs, can the minister indicate where those labs are located and whether there has been any change in the fee structure over the last year as to--I believe that that would be the labs where farmers would have testing done--and whether there has been any change in the fee structure as to the cost of having testing done?

Mr. Enns: Staff advises me that there was roughly a 5 percent additional increase made to the fee structure last July and that no further increases are contemplated in these sets of Estimates before you.

Ms. Wowchuk: Could the minister indicate whether these are government labs, or is this part of the labs, the services that were privatized a few years ago?

Mr. Enns: I am advised that this refers to our provincial diagnostic lab housed at the University of Manitoba.

Ms. Wowchuk: I have no further questions under Vet Services, but I do have some questions under the Soils and Crops branch.

Mr. Deputy Chairperson: 3.4. Agricultural Development and Marketing (a) Administration (1) Salaries and Employee Benefits $128,100--pass; (2) Other Expenditures $30,800--pass.

Item 3.4.(b) Animal Industry (1) Salaries and Employee Benefits $1,521,600--pass; (2) Other Expenditures $492,700--pass.

Item 3.4.(c) Veterinary Services (1) Salaries and Employee Benefits $1,462,000--pass; (2) Other Expenditures $502,400--pass; (3) Grant Assistance $467,100--pass.

Item 3.4.(d) Soils and Crops (1) Salaries and Employee Benefits.

Ms. Wowchuk: Mr. Chairman, I would like to ask a few questions with respect to this department.

One of the areas that I want to look at is we hear about a lot of interest in organic farming, and many people wanting to look at purchasing food for consumption that is grown without chemicals, and people are concerned about the impact of chemicals and fertilizers and such on our soil. I wonder whether the minister can indicate whether in the Soils and Crops branch more research is being done into organic production of crops and where that work might be done at this time, whether it is in other parts of the province as well as in Carman.

Mr. Enns: Mr. Chairman, I would first of all like to welcome to the table Mr. Barry Todd, Director of our Soils and Crops branch, working out of Carman.

I am aware, of course, of the group of producers that the honourable member speaks of and that they have formed an organization and are looking towards ways and means of better identifying themselves and perhaps more importantly their products for this specific market that the member alludes to. I can assure the honourable member that the department works with all primary producers in the way you would expect us to do.

We have increased our emphasis on a form of integrated protection. The Organic Producers Association of Manitoba has about 150 active members, I am advised, of which 106 qualify for what they call certified producers. Various organic crops are grown. Actually, in the year 1995, just a bit of general information on some 9,400 acres in the province of Manitoba, they include alfalfa, barley, buckwheat, canola, caraway, carrots, cattle, chickens, rye, onions, peas, clover, flax, garlic, hay, lentils, millet, oats, wheat, sunflowers, mustard and various forms of vegetables.

We work actively with these farmers. We have through our Farm Business Management program funds for the start-up of six organic marketing clubs. I think that is perhaps where we can be the biggest help because, understandably, they are looking for specific marketing advice. These clubs are located in McAuley, Brandon, Morden, Neepawa, Steinbach and St. Pierre, and Manitoba Agriculture supports organic production as a marketing opportunity for producers, but we do emphasise that conventionally produced foods are equally safe and nutritious. We cannot find ourselves, as you would expect, coming down on one side or the other.

We believe that our conventional food production provides safe and nutritious food for all our citizens, but we recognize that there are groups which are prepared to look at things somewhat differently and produce food somewhat differently and put in that necessary effort. The Department of Agriculture certainly finds time and supports their activities.

Ms. Wowchuk: The minister has been to other countries where I understand there is a lot of interest or concern about having a very clean food supply. We know of the issue where we had, within the pork industry, comments made that if we did not have chemical free pork, they were not interested in purchasing from us. When the minister was on his last trade mission, did he have the opportunity to meet with people who might be interested in purchasing organically produced food products on a much larger scale? What the minister talks about, six marketing clubs, appears to be products that are targeted to a local market, quite a small market. My understanding is that there is an interest on a much broader scale to have chemical free food, whether it be grain or meat products as well, so I wonder whether the minister found in his travels that there is indeed a greater awareness and a greater need, greater markets for organic grown products.

Mr. Enns: Mr. Chairman, I am advised that some shipments of goods to the more significant markets that the member refers to are in fact taking place, such as durum wheat in special circumstances but it is spotty and difficult. We do not have, to begin with, a national certification system in place that would make this more convenient, more possible. I have to report that certainly the member is quite right, particularly in a market like the Japanese, very demanding, very discriminating in terms of placing the health and safety factor very high on their list of priorities, but at the same time they are very sharp traders. It seems from my personal experience that price, the bottom line, is still very much the matter. They want both. They have in too many instances at least not demonstrated to me that they are prepared to pay that premium that would have to be in place for simple reasons, for volume if nothing else, in shipment and the cost pertaining to making a sale.

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The challenge of our conventional food industry is to meet forever increasing general standards of acceptability, whether it is residue in meats or elsewhere. Interestingly enough, on this very subject, I had a very interesting meeting. We have research being done right here in Manitoba by a company--well, I should not call it research--that uses a different product. It is an organic problem, does not have any problems of toxicity in the control of insect damage to grain. It is an addition that can be introduced at different levels of grain production and grain that is stored under not ideal circumstances, moisture levels a little higher than they ought to be. We have bridged problems of contamination with grain. Some of the more toxic chemicals that are used to control that, you know, at the same time cause concern among the eventual purchasers of that grain.

Canada has, fortunately, among the highest reputation in terms of quality and safety of our grain movement, further add to it by introducing this product that would ensure safe storage of grain. All too often in so many instances we are advised that, particularly in some of the lesser developed parts of the world where some of our grain moves to, significant portions of that grain can spoil while waiting to be consumed. It is estimated that insect damage to our grain costs our grain industry upwards of $400 and $450 million annually. So an attempt should be made particularly if it could be done in an environmentally acceptable way to alleviate that kind of a problem, but I am straying from the subject of the matter. Actually I want to go out for a cigarette, but the honourable member will not let me.

Ms. Wowchuk: Can the minister indicate where the testing or the work on organic farming is being done and approximately how much of the budget is in this area? Is there a breakdown of the amounts of money that actually would be spent on organic farming available or would it be quite minimal?

Mr. Enns: We cannot break down any specific amount that is dedicated to this aspect of agriculture. We would acknowledge, it is relatively small amounts. Work that is being done in this area is usually being carried out at various research centres that we have, at Glenlea, at the university where the emphasis is on less reliance on various forms of chemicals, herbicides, pesticides. The kind of research that is going on a limited scale is done at these facilities, but we cannot pull out of these Estimates the amount of work that the department actually does in this area.

Ms. Wowchuk: Mr. Chairman, what I was looking for--I wondered whether there might be one site that was specifically designated for research on organic farming, but I take that not to be the case.

Mr. Enns: Mr. Chairman, I am advised that probably the closest thing that we have that the member is looking for is the Glenlea Research Station where most of the kind of work in this area is taking place in natural field trials.

Ms. Wowchuk: Mr. Chairman, I understand that there is also a site at Roblin where there is research being done. I wonder if the minister can indicate what the focus is of that site, and if he could also indicate what the staffing is there or whether there are specific people who are working there or whether it is just staff from the Department of Agriculture.

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Mr. Enns: Mr. Chairman, at the site that the member indicates a problem, which is a satellite operation of the Manitoba Crop Diversification Centre headquartered at Carberry, two specific areas of research are being conducted there. One has to do with the use of effluent for irrigation purposes, and then the various crop rotations, crop diversifications that under irrigated conditions are made possible. I will wait for some information staff just provides me. The Manitoba development centre satellite at Roblin is establishing projects to support timothy hay for export, potato varieties, field pea population and various other new crop development projects. There is also the hope for establishing horticultural crops like the saskatoon bush and the chokecherry orchards. So there are different types of research that is being undertaken at the Roblin site.

We have another satellite site at Melita which tends to concentrate on irrigated potato production, irrigated canola production, irrigated cereal production and then some of the grasses as well, Kentucky bluegrass seed production, the narrow field bean productions and so forth.

Ms. Wowchuk: Could the minister indicate then, is the majority of the research that is being done at all of these sites related to crops grown with irrigation? Is that the focus of all of this? Is there no research done on dry land crops or other kinds of crops, or is this done in another department?

Mr. Enns: Mr. Chairman, there is a diversity of research being undertaken. At Roblin, I am advised, most of it is dry land research, but it has that one specific component to look--not irrigation in general, but the irrigation of effluent waters and their impact.

Ms. Wowchuk: Can the minister indicate then at which site would the biological weed control program be carried on?

Mr. Enns: My director of the Soils and Crops branch advises me that that work is carried on throughout the province of Manitoba where a particular weed identification has been made and the various biological efforts of control are found, you know, expedient to try to experiment with and to exercise.

Ms. Wowchuk: Mr. Chairman, a few years ago we had the Crop Residue Burning program brought in to control the amount of burning that was going on in the province as a result of some very serious smoke problems that were in the area, particularly in the Red River Valley, during some very wet years. I would like to ask the minister if he can let us know what has been the status of that. I know we face some drier weather and should not have had nearly as much burning, but can the minister tell us what is happening? Also, what other work is being done to look at alternate uses for the straw since there is very heavy straw in some areas? If we are looking to restrict the amount of burning, we are going to have to look at alternate uses for the straw. I know we have had some discussion and people looking at straw board. Would this branch be doing any research into alternate uses for straw?

Mr. Enns: Mr. Chairman, I have pretty good news to report to the committee that when the program was introduced in its first year, and I suppose that should not have surprised us, there was regrettably a considerable number of charges that had to be laid, somewhat over 70 I am advised. This past year, '95, only three charges were laid, which compares to the 11 that were laid the year before. So a dramatic decrease, and I think a very encouraging and commendable acknowledgment on the part of the grain producers that this was a problem and one that they are prepared to help work with the department and the crop residue burning committee that tries to understand the demands, legitimate problems associated with the residue, and at the same time take, into consideration the environmental issues that uncontrolled burning of straw did provide. I think that is a positive response on the part of producers when only three charges were laid in this last year.

We look forward to continuing support through various programs and the alternative uses for this crop residue, the straw. The Isoboard project that is slated for Elie is still very much in discussion stage; regrettably, I cannot indicate to the honourable member that it is off and running. We had a very successful Straw-to-Gold symposium that the departmental people were responsible for hosting and bringing together various different people from different parts of the world to talk to us about the opportunities of this kind of alternative use for the waste material, the residue. There is a group in Killarney that is extremely interested in the wheat straw-based particle board plant proposal; and, also, as the member will be aware when in Swan River Valley, the Isoboard plant proposal that is still being discussed and talked with various different investors and business people from that area.

We will not rest until we have some further resolution to it. There is a straw utilization committee, that includes the federal and provincial departments, that was established to explore alternate uses for straw. This committee has identified a number of opportunities for that alternate use. It includes everything from paper to ethanol and other fuels, insulation, fabrics, erosion control mats, edible fibre, horticultural products, sanitary products, moulded car body parts and building with straw bales.

I do not take any personal credits, that belongs to a predecessor of mine, but I certainly commend the Department of Agriculture and staff that in Manitoba, partly because of having passed the legislation prohibiting the indiscriminate burning of straw, it has focused us and our attention on the potential alternative uses of it and to some extent we have really benefited from it. We are on the leading edge of that whole examination and while the same, of course, is taking place to some extent in places like Saskatchewan and Alberta, we believe with some modesty that we have a bit of a head start in other jurisdictions. The department is doing its best to maintain that position and nothing would make me happier than to see the fruition of some of these projected proposals to come into being and that straw in an annual sustainable way would be diverted to that use rather than burning.

Ms. Wowchuk: The minister indicated a straw utilization committee. Can the minister indicate whether there is a representative from the department on this committee and who it might be and whether this committee meets on an ongoing basis?

Mr. Enns: Well, Mr. Chairman, as it so happens, I just met with members of that committee a week ago, I think, or just recently. It is a group that comes together from time to time. We are just currently looking at some restructuring within that organization, at some of the original dollars that were funded under the auspices of this group for exploration, some of the initial meetings that were held. The honourable member will remember there was a gentleman by the name of Mr. Wong who talked about converting straw into paper. He received some support for which he undertook various meetings throughout the province, and, in fact, some trial runs actually produced some paper at a small mill in Vulcan, Alberta. He was granted $150,000 of which I think there is still some $40,000 or $50,000 unspent, and our committee is looking at maybe utilizing some of these dollars to help restructure themselves.

We see continued value for the committee to work, although what has happened, of course, is that you have specific groups in different parts of the province kind of taking the bit and wanting to run with it, and at some stage we have to decide what it is that the potential industry requires.

Ms. Wowchuk: Can the minister indicate then, when was this committee established and what is their budget? Do they have an annual budget that they operate on?

Mr. Enns: The short answer is that the committee was formed at the same time that the legislation was brought in that prohibited the straw, and they operate internally, with internal funds, but in addition to that, the kind of specific project that was funded, like the one I mentioned, Mr. Wong, some $150,000, but the kind of support to run the straw symposium, that was carried internally within the department.

Mr. Deputy Chairperson: The time being 5:30 p.m., committee rise.