The following address was made today by the Minister of Development and Rural Renewal, Judy Foote, at a luncheon meeting of the Newfoundland and Labrador Employer's Council:

Thank you for the opportunity to address the Newfoundland and Labrador Employers' Council today.

Your members employ in excess of 60 per cent of the workforce in Newfoundland and Labrador. This represents an influence, and responsibility, which cannot be underestimated.

The future prosperity of our province depends, to a very significant extent, upon the drive, commitment and success of the private sector. The efforts of the Department of Development and Rural Renewal, and all of our government's economic development activities, can only be successful if they support and enhance the creativity and competitiveness of the business community.

Government's role is not to create jobs, but to create a positive environment and stimulate a business climate in which the private sector can generate sustainable wealth and employment opportunities for the people of Newfoundland and Labrador.

Today, I will speak to you about the mandate of my department, how we are addressing the economic realities facing our province today, and where government anticipates that leading us in the future. In turn, I will ask you to consider your role in shaping our province's future, and encourage you to offer your advice to government. It is important that government maintains open channels of communication with your group so that together, we will be able to address the challenges and needs of our workforce.

It is by forming partnerships such as this that we will be able to make a stronger Newfoundland and Labrador.

Mandate of the Department of Development and Rural Renewal The newly created department of Development and Rural Renewal reflects government's vision for economic growth in this province. This vision involves managing our own finances efficiently and paying down the debt. It's about "right-sizing" government - tailoring the services government delivers to our core needs and our ability to pay. We are creating an environment in which business and industry can thrive, and are seeking opportunities for new sustainable employment through economic development. Government's vision involves revitalizing all areas of the province. And that means building partnerships with the people of the province.

To ensure that government is ready to do its part in developing these partnerships, we are now embracing our own period of right-sizing and re-focusing, as we integrate the roles and responsibilities of four formerly separate agencies. The Department of Development and Rural Renewal has integrated the funded and technical support services of the former Enterprise Newfoundland and Labrador, the advisory and research services of the former Economic Recovery Commission, the employment programs previously offered by the Employment Branch of the former Department of Employment and Labour Relations, and the technical and marketing expertise of the Craft Division of the Department of Tourism, Culture and Recreation.

These four agencies have now been combined in a single department of government mandated to help revitalize all regions of Newfoundland and Labrador, with particular emphasis on the rural areas. The financial resources, regional client services and programs that have been brought together under my direction will be important tools in meeting this objective.

Decentralization, forming partnerships with regions, private sector and community groups, and identifying and capitalizing on our regional strengths, are all key themes of this department's mission. Our department will be decentralizing program delivery wherever feasible. Our regional staff have the close-to-the-client awareness of local needs and we intend to realize the advantages of our department's decentralized structure wherever possible. As an example, the inclusion of the Employment Branch within my department provides greater integration of employment and labour market services with regional strategic economic plans and business development initiatives.

REGIONAL ECONOMIC DEVELOPMENT
The commitment of government to economic diversification and rural revitalization is also being realized through the establishment of 20 economic zones.

The 20 Regional Economic Development Zone Boards will focus on regional economic priorities in their regions. The Regional Economic Development Boards will act as co-coordinators between economic groups, businesses, other interest groups and individuals working in the region. They will work with both federal and provincial governments, determining how best to target limited financial resources in support of strategic economic initiatives.

If we are to achieve long-term economic growth we must pursue an integrated approach to economic development where all parts contribute to the whole. We must identify viable business and economic initiatives, and we must prioritize those initiatives so that we concentrate our efforts where they will do the most good.

By "our" efforts, I mean government, zone boards, community-based groups, and business organizations such as yours. I am talking about partnerships between government and the private sector; and between government and communities. I am talking about signing performance contracts with Regional Economic Development Boards which will reflect an economic partnership in which the partners commit to performance and commit to producing economic results.

Employer groups, such as yours, form an integral component of this process. In fact, as most of you probably know, your president, Marilyn Pike, sits on the Regional Economic Development Board for zone 19, known as the Capitol Coast Development Alliance. That means your interests are actively represented in the zonal process.

I am pleased to say that 18 of the 20 economic zones are up and running with permanent boards in place. The remaining two zones, 18 and 20, on the Southern Avalon are quickly moving to establishing their Provisional Boards and we expect them to move to permanent board status in the near future.

Volunteers have been the key players in this whole process. Government could never afford to pay all the volunteers for the amount of time they have devoted to establishing their regional boards. I feel so strongly about this that I have been making the point of travelling to each region to officially establish the boards and take advantage of this opportunity to personally thank and congratulate the volunteers. I have been accompanied by either the Honourable Lawrence MacAulay, the Secretary of State responsible for ACOA and Veteran's Affairs or the federal Member of Parliament for the region, and the local MHAs. Such representation has shown clearly the commitment of both the federal and provincial governments to the economic zone process, and for this new approach to economic development.

These boards also consist of representatives from municipalities, community development groups, the business, labour and education sectors, and special interest groups unique to the region. And whether you're from St. John's or rural Newfoundland, the objective and the outcome will be the same.

Those who know the local issues best will be able to identify these issues and liaise with government so that together, in partnership, government can play a more results-oriented role in meeting the needs of each region in the province.

Just as these Regional Economic Development Boards provide advice to government on how to best develop their region economically, the Newfoundland and Labrador Employers' Council can play a similar role with government at the provincial level. It is to organizations such as yours that government must look when determining how best to serve the needs of employers in the province. When determining the nature of and how best to respond to issues of interest to our province's employers, we look to you to help provide the answers. By partnering with you, government can more effectively work for you.

BUSINESS DEVELOPMENT
My department is also forming partnerships to support its business development and employment program objectives. We are partnering with all levels of government and with community- based economic agencies to complement services and avoid duplication of activities: agencies such as Business Development Centres, the Atlantic Canada Opportunities Agency (ACOA), the Business Development Bank of Canada, the Atlantic Investment Fund and commercial lending institutions.

My department will be focusing on assistance to small business, particularly first-time businesses who have not been able to secure financial guarantees in the private sector. We are not competing with the private sector, we are a lender of last resort, however our mission is to ensure that all potentially viable businesses have the opportunity to succeed.

We recognize that today's business failures often result from a lack of management skills and counselling rather than from a lack of capital alone. My department is, therefore, refocusing its available resources more sharply to provide business development services as well as specific financial services. We are concentrating on the seeding and start up of new small businesses, and the development of skills to enable businesses to lever commercial funding from other sources.

Loans designed to support the maintenance of existing enterprises, without offering the potential to expand or diversify the enterprise into new business areas, will generally no longer be provided by my department.

EMPLOYMENT INITIATIVES
My department also offers a wide range of provincial employment programs and has successfully augmented these provincial efforts in partnership with the federal government. We have also been able to offer increased student and other employment opportunities through our established relationship with the federal government.

Over the past several years, the provincial government, through the former department of Employment and Labour Relations, and the departments of Education and Social Services, has worked closely with Human Resources Development Canada (HRDC) to explore innovative new approaches to providing employment programming. One of these new approaches involved piloting a project here in the province, which brought together the departments I just mentioned, with various economic development agencies such as the former Enterprise Newfoundland and Labrador, the Atlantic Canada Opportunities Agency, and Business Development Centres.

The objective was to form a partnership which matched the province's employment programs with the expertise of the economic agencies while more effectively directing employment funding to viable businesses.

One of the results is the extremely successful Student Work and Service Program (SWASP). The Student Work and Service Program, or SWASP, consists of two components: paid employment and community service. Through the paid employment program, the employer is offered a wage subsidy of $2 per hour for a maximum average of 40 hours per week. What is different about this program is that students, in addition to their pay, receive a $50 tuition voucher for every week worked under the program. The vouchers are to be used at a recognized post-secondary institution. This provides students with an easy way to save for their tuition.

The Community Service component allows the student to work for a non-profit corporation, receive a $50 per week stipend and accumulate up to $1200 in employment vouchers to, again, be applied against the tuition cost at a recognized post-secondary institution. The students gain valuable work experience while saving for their education. It is a program deemed highly successful by employers, students and parents alike.

Consequently, I am delighted with the success of our student employment programs this summer. Through the paid employment component alone, we have put over $1 million into student employment initiatives this year, employing over 1,000 students and supporting over 750 initiatives throughout the province.

Through the Community Service Component, government has also put in almost a million dollars, providing 620 students with jobs.

The Graduate Employment Program (GEP) is also generating successful employment placements. This program is designed to address the paradox facing post-secondary graduates who are new entrants to the labour force: that being that it is difficult to obtain employment without experience, and difficult to obtain experience without having been employed.

The Graduate Employment Program has been a provincial government program since 1988, however it received additional funding in 1994 when the federal government recognized its success and consequently matched every provincial dollar that went into the program.

The Graduate Employment Program employs recent graduates of post- secondary institutions for a 52 week period, and offers a 60 per cent wage subsidy to the employer, to a maximum of $10,000 for each position created. To date, government has put over $650,000 into this program, making it possible for 70 recent graduates to practice their skills.

A recent review of the long-term impacts of the program showed that the majority of graduates were retained by their sponsor for at least one year after the end of the wage subsidy and that over 90 per cent of graduates learned new skills as a result of their work placement. This recent review also indicated that roughly 75 per cent of graduates hired through the program would otherwise have left the province.

Clearly the Graduate Employment Program has been a success and created significant new permanent jobs, enhanced skill development and has reduced the out-migration of Newfoundland and Labrador's educated youth.

These are all examples of successful partnerships formed between governments and of partnerships formed with you, employers in the private sector.

The provincial government has also been given the opportunity to develop further partnerships with HRDC and the Department of Education through Employment Insurance reform. An important proposal stemming from EI reform would allow provinces to take control of managing and delivering active employment measures such as wage subsidies, self- employment and skills training. This proposal, which the province is considering, gives us the opportunity to more effectively integrate employment and training needs as identified through the Regional Strategic Planning process taking place in the economic zones. Now, we will be able to more aptly coordinate the employment and training needs of individuals with the economic development activities of the regions.

With these changes, at the community and government levels, we have the opportunity to channel our collective resources and energies in a way that can bring our province out of the underdevelopment that has characterized us in the past. Translating our goals and principles and desires to reality is never easy. This government's commitment to consultation, partnership, and action is, I believe, the opportunity to make the revitalization of our rural communities and the development of all of our regions a reality.

As partners, we can succeed, and success will breed even more success. Let us work together. The challenge is great but the reward will be a prosperous Newfoundland and Labrador. I look forward to working with you to make it a reality.