New Brunswick Premier Shawn Graham has committed $26.6 million toward cleaning up the polluted Saint John harbour, leaving the federal government as the only partner in the project not contributing its share of the total cost.

Graham and his 18-member cabinet were sworn in on Tuesday and had five promises to keep in their first 24 hours in office, including a pledge to make a binding agreement with Saint John on harbour cleanup. The money will be parcelled out during the next seven years.

Harbour cleanup advocate Tim Vickers chats with Premier Shawn Graham in Saint John on Wednesday.

The new premier presented Saint John Mayor Norm MacFarlane with a memorandum of understanding committing the province's share of funding to clean up the harbour at a sold-out breakfast meeting at the city's trade and convention centre.

Graham's announcement won a standing ovation from the crowd of business and civic leaders and environmentalists, who have argued for years for provincial funding to clean up the raw sewage in the harbour.

"An accelerated time frame demonstrates our desire to move this project forward immediately," Graham said.

The city pumps millions of litres of raw sewage into the harbour every day. The price tag for cleanup is approximately $80 million, and the city has already promised to pay one-third of the cost. The federal government has agreed to commit just $3 million to the project.

Tim Vickers of the Atlantic Coastal Action program said this commitment from the province puts the pressure on the federal government to come up with the rest of the money.

"Clearly we have the province coming forward and saying, 'Look, we're stepping up to the plate, we're making the first move,' and that opens the door for the federal government to come forward and know that the province is serious about this."

MacFarlane said the city can't proceed on the project until Ottawa signs on for the rest of the money.

The new premier appointed five cabinet ministers from the Saint John region, including Supply and Services Minister Roly MacIntyre, who said he will lobby the federal government to contribute its share of the funding.

"I will work to promote this project with my federal counterparts at every opportunity," he said.

The Liberals also made good on their other four "Day 1" promises.

A pledge to reduce the provincial gas tax happened overnight Tuesday. At midnight, the New Brunswick Public Utilities Board set the new price of regular self-serve gasoline at 86.07 cents a litre, down from the previous price of 90.4 cents a litre. Certain approved retailers can add as much as three cents a litre to cover the cost of distribution.

"This reduction makes New Brunswick's provincial [gas] tax the lowest east of Alberta, a distinction I am committed to maintaining over the course of our mandate," Graham said.

Graham kept his promise to split agriculture and fisheries into two departments.

Graham also said the decision's been made on delivering $2,000 grants for first-year university students, but the details still have to be worked out on how the money will be distributed.

Cabinet also approved a change in the way seniors have to pay for nursing home care, though Graham said it may take a few days for the change to take effect.