Debates of March 18, 2004 (day 3)

Thank you, Ms. Lee. Mr. Minister.

Thank you, Mr. Chairman. The last increase took place April 1, 2003. As a result of that, we estimated approximately $1 million as a result of that increase. So the last increase, April 1, 2003, was a 10 percent increase in mark-ups. We estimated a net result of approximately $1 million.

Thank you, Mr. Minister. Ms. Lee.

Thank you, Mr. Chairman. So that increase as a result of taxation does not go into the revolving fund. It goes into our general revenue. Does it go in here? Where would that show up on this page?

Thank you, Ms. Lee. Mr. Minister.

Thank you, Mr. Chairman. The Liquor Commission revolving fund shows the liquor sales income, so the cost of product, the increase of our mark-ups shows here. What you see on the bottom of the page, you’ve got your income, your operating expenses and then a surplus. What goes back into general revenues falls under page 3-22 and it shows it going into general revenues from Liquor Commission net revenues. The amount under surplus, the $20.853 million goes back into general revenues.

Thank you, Mr. Minister. Ms. Lee.

Thank you, Mr. Chairman. So the net revenue is in the amount of $20 million after taking out the expenses.

I have another question. Where does the money that the Liquor Board gets from the fines and whatever the inspectors do when they go out to bars and give fines to establishments, does that money go into the revolving fund as well and they are available to be used as expenses prior to it being accounted for at the end as part of the surplus or whatever?

Thank you, Ms. Lee. Mr. Minister.

Thank you, Mr. Chairman. Under the operating results, if you go to 3-20, Liquor Commission revolving fund, operating results under income, the last item, Liquor Licensing Board revenue, that is made up of a couple of things. There is a fee charged to all the licensees and that fee is incorporated there, as well as the fines that occur. Thank you.

Thank you, Mr. Minister. Mr. Delorey.

Thank you, Mr. Chairman. Just following up on that question where you talk about fines. These wouldn’t be fines that go through the courts then, would they?

Thank you, Mr. Delorey. Mr. Minister.

Thank you, Mr. Chairman. No. The fines that would fall under here are by the Liquor Licensing Board that they would impose at their hearings. This is what is incorporated here, not when an individual goes to court. This is through the Liquor Licensing Board and the hearings they have held and when they put fines on establishments. Thank you.

Thank you, Mr. Minister. Mr. Delorey.

Thank you, Mr. Chairman. I don’t know if any penalties or fines that are levied ever do have to go through the court before they are paid, but if there was a fine associated with the Liquor Commission that had to go through a court system and there was a fine established, then would it go to general revenues or go back into the revolving fund?

Thank you, Mr. Delorey. Mr. Minister.

Thank you, Mr. Chairman. As a result of a Liquor Board review or hearing and a fine being put on an establishment, the establishment would have the ability to appeal and could go to court, but because that fine was established under the Liquor Act, it would end up coming back in here and this is where it would show up. If it is the result of a Liquor Board hearing and an establishment gets fined, if they appeal they can go to court and appeal it, but at the end of the day if that ruling holds, because it started under the Liquor Act, this is where the money would show.

Thank you, Mr. Minister. Mr. Delorey.

Thank you, Mr. Chairman. I wanted to make another comment and I don’t know if it’s totally appropriate on this page. I meant to do it under general comments and I didn’t. One Member was talking about the importance of looking at our Liquor Act and the review of the Liquor Act. I may come from a bit of a different approach than what he says, but I was wondering if the Minister could tell me has there been any money appropriated towards the review of the Liquor Act? You mentioned that it’s a high priority to look at the Liquor Act. How big of a review are we looking at making here? Has there been any money appropriated towards that yet and what is the plan? Thank you, Mr. Chairman.

Thank you, Mr. Delorey. Mr. Minister.

Thank you, Mr. Chairman. Mr. Chairman, the Liquor Act review would be a substantial one. It hasn’t been changed for a number of years. There was an exercise done through the 12th Assembly and the changes were not incorporated at that time. That bill did not proceed, so we are looking at a fairly extensive review through this process. There hasn’t been any money allocated at this time for that review. Through the previous Assembly, there was some money spent on doing the initial work to look at what could be incorporated in that. That amount has been financed from within internal allocations, so there hasn’t been any money set aside for this. The work that’s been done has been done from internal resources and there hasn’t been any money incorporated for the review process itself. Thank you.

Thank you, Mr. Minister. Mr. Delorey.

Thank you, Mr. Chairman. I would certainly encourage the department to do everything they can from internal sources to look at the problem areas in the Liquor Act and see what changes we can make. I know that a lot of the things that are in the Liquor Act now probably would have a lot more impact on residents just if they were enforced. We hear about it on the radio quite often now where they are starting to enforce the Liquor Act a little bit more to establishments that serve alcoholic beverages and that sort of thing. I don’t think we have to go to multi hundred thousand dollar reviews to make some of the changes that might help.

The other part is as far as educating the public, I don’t know if a review of the Liquor Act would do that. We can probably put a lot more pressure on the education system or Health and Social Services because that’s probably where the education end of it would come anyway. I would certainly like to be involved in looking at what’s wrong with the Liquor Act before we go into a review that’s going to cost us hundreds of thousands of dollars. Thank you, Mr. Chairman.

Thank you, Mr. Delorey. Mr. Minister.

Thank you, Mr. Chairman. As our process works, we would come forward to Cabinet with what we felt was needed and if it was agreed at that point, we would go to committee and see if that is something committee Members agreed to move forward and proceed on that basis. If there is not support for such an intensive review, then those comments would come back to us and we would look at the issue again within Cabinet. But we haven’t gotten to the stage yet of even a proposal. It’s just some work going on to look at areas and how we can begin to tackle this process. Thank you.

Thank you, Mr. Minister. It's about five minutes to 6:00 and I don't know what the wish of the committee is. We have a few more minutes here, we have two other speakers on our list. We can start with Mr. Hawkins, and then I have Mr. Yakeleya and we will try to conclude this. Is that the wish of committee? Agreed?

Agreed.

Mr. Hawkins.

Thank you, Mr. Chairman. Referring to page 3-20 under other income, $180,000, we see quite a substantial change. Could the Minister supply me with some information on a breakdown in that regard? Thank you very much.

Thank you, Mr. Hawkins. Mr. Minister.

Thank you, Mr. Chairman. We can endeavour to get that information for the Member. I believe the majority of that is related to the recycling initiative. Right now we do have a fee that we charge to customers that buy our products, and that's the money that's accounted for. Just for information, the numbers that we do have come out of the Liquor Commission report and would refer to 2003 numbers. So we wouldn't be able to give the absolute number for this year, but it's an estimate that they feel that will come up. There are some for import permits identified in the 2003 number. The bottle deposit program is $76,000…No, I don't think that's right. We're going to have to get the numbers and provide them to the Member. What I have here is not accurate. Thank you.

Thank you, Mr. Minister. Mr. Hawkins.

Thank you, Mr. Chairman. Speaking on that note, I do appreciate the fact of the breakdown of what other income means, as well as the actual breakout of the numbers, but you did bring me to another subject under other income when you referred to the deposit of bottles. I assume the deposit of the bottles, that fee goes back into a fund that pays out people when they return the bottles. Is that correct?

Thank you, Mr. Hawkins. Mr. Minister.

Sorry, Mr. Chairman. I will have Ms. Melhorn respond to that as I wasn't able to catch the full question.

Thank you, Mr. Minister. Ms. Melhorn.

Thank you. There isn't a separate fund kept, but just the money is refunded to those who bring the bottles back.

Thank you, Ms. Melhorn. Mr. Hawkins.

Thank you, Mr. Chairman. That's good news. Who maintains ownership of the bottles once the money has been refunded? Who retains ownership once the bottles are returned for money? Thank you.

Thank you, Mr. Hawkins. Mr. Minister.

Thank you, Mr. Chairman. Once the bottles are returned to the depot, they would be the property of the depot they were returned to. The allocation, from my understanding, is broken out from there and divvied up amongst the communities that have the depots. They receive the bottles and would either crush them at their locations or send them south to further recycling. Thank you.

Thank you, Mr. Minister. Mr. Hawkins.

Thank you, Mr. Chairman. Maybe if the Minister could elaborate a little further, and I'll set this out clearly so I completely get a good picture of this. As I see it, we get a deposit on the bottle, the bottle goes out, gets returned, the deposit is returned to the customer who returns the bottle, but we leave the bottles with the depot. Do we pay the depots a contracting fee, is that why we leave them the bottles? I would think that we would take the bottles and do something with them if that's the case. How does the depot make their money? Do we pay them separately on contract and the bottles become an extra? I'm looking for a little clarity on that one. Thank you.

Thank you, Mr. Hawkins. Mr. Minister.

Thank you, Mr. Chairman. Mr. Chairman, my understanding of the process is we offer contracts to depots for that operation, but then they also receive the bottles and can pay out the fees that they would earn from those collections. They collect the bottles, get a fee at the local depot, and then would pay the group that brought that forward and then would send their product on. Again, through our organization, they would get some funding for that. Thank you.

Thank you, Mr. Minister. Mr. Hawkins.

Thank you, Mr. Chairman. I'm going to apologize for this one because it could because it has been a long day, but I don't think I quite understood the answer. Like I said, I stress it could be because it's a long day. Are they getting a fee for service and the bottles are being left within as an incidental? For example, are they able to do what they wish with the bottles, or is that incorporated in the fee for service? Thank you.

Thank you, Mr. Hawkins. Mr. Minister.

Thank you, Mr. Chairman. To do this right, I'll have to provide the Member with an actual accounting breakdown from the centre back to…When you pick up your product at the store you pay a fee. How that money is collected and then how local depots operate from that point forward we will supply that information. Thank you.