April 16, 1999
(Executive Council)

Treasury Board and NewTel Enterprises announce new

industrial benefits committments

Treasury Board Secretariat and NewTel Enterprises Limited today announced they have signed an updated Industrial Benefits Agreement (IBA), amending the IBA signed in 1994 when Newfoundland and Labrador Computer Services (NLCS) was privatized and became part of NewTel Information Solutions (NIS).

"Today's announcement is a positive development for the implementation of the provincial government's information technology growth strategy," said Treasury Board President Anna Thistle. "Since the original IBA was signed in 1994, job creation and the subcontracting of work to local IT companies has been exceeded with more than 185 new IT jobs created here and $14 million in IT business subcontracted to Newfoundland suppliers."

Under the updated IBA, NewTel Enterprises has committed to increase IT work subcontracted locally from $21.2 million to $24.9 million (a $3.7 million increase) over the term of the agreement. The Government of Newfoundland and Labrador's minimum commitment under its computer services level agreement with NewTel Enterprises has been reduced by $1 million annually and Andersen Consulting, a member of the original consortium, has agreed to source an additional $4 million in new IT professional services to xwave solutions. The industrial benefits and computer services level agreements are in place until March 31, 2002.

Changes in the Industrial Benefits Agreement were brought about as a result of changes in the business focus of some of the original consortium members. "These changes and the creation of the new IT company created a need to revisit the IBA agreement. The new arrangements will be positive for local IT companies, xwave solutions and the province," said Thistle.

"The phenomenal growth of our local IT industry since the privatization of Newfoundland and Labrador Computer Services (NLCS) in 1994 is an indication of the strong partnership between the public and private sectors," said Bob Newell, president of xwave solutions,

NewTel Enterprises information technology subsidiary and one of the top five Canadian-owned IT services companies in Canada. "The updated IBA will be positive for the IT industry in the province."

For further information, contact:

David Wells Harry Connors, Director

Director of Communications Corporate Communications

Treasury Board NewTel Enterprises

(709) 729-6830 (709) 739-2837

1999 04 16                      5:15 p.m.