Whitehorse, Yukon

Thursday, April 6, 1989 - 1:30 p.m.

Speaker: I will now call the House to order.

We will proceed at this time with Prayers.



Speaker: We will now turn to the Order Paper.

Are there any Introductions of Visitors?

Are there any Returns of Documents for Tabling?


Hon. Mr. McDonald: I have for tabling the two job descriptions, Fiscal Adviser to Land Claims and Devolution and Manager of Financial Accounting, as requested by the Member for Riverdale South.

I also have for tabling the answers to various questions from the Members opposite.

Hon. Mr. Webster: I have two legislative returns for tabling.

Speaker: Are there any Reports of Committees?


Introduction of Bills?

Are there any Notices of Motion for the Production of Papers?

Notices of Motion?

Are there any Statements by Ministers?


Yukon Hosting Circumpolar Conference of Education Ministers

Hon. Mr. McDonald: I am very pleased to rise today to announce that the Yukon Government will be hosting a circumpolar conference of Ministers of Education from June 19 - 21, 1989.

This conference will allow the leaders of education from a diversity of circumpolar governments to join me in an informal setting to discuss educational issues of particular interest to northern jurisdictions. Ministers from Alaska, the Northwest Territories, and the Soviet Union have confirmed their attendance to date. Invitations have also been extended to the Scandinavian countries, and to the provinces of Newfoundland and Quebec.

During the conference, the Ministers will have the opportunity to explore such significant topics as language development, learning styles, distance education, local governance and legislative mandates, or any other topics considered to be of mutual interest and concern.

This event is the third in a series that began two years ago, when the first such circumpolar conference was convened in Iqualuit, NWT. It was determined at that time that a conference should be held every year to assist Ministers from northern jurisdictions around the world to exchange information and ideas about schooling and education.

The Iqaluit conference saw the signing of protocol agreements between the Yukon and Alaska, and between the Yukon and the Northwest Territories. These protocols laid the groundwork for further joint initiatives between the Yukon and her neighbours. They serve as examples of the ways in which circumpolar contact building bridges where common ground exists.

The conference will be held at the Dalton Trail Inn on Dezadeash Lake. This will allow the Ministers to see first hand some of the Yukon’s most spectacular scenery, and will provide a tranquil location for the meetings.

It is the policy of this government that continued collaboration between circumpolar governments can provide all participating governments with useful ideas, and will foster cooperative projects and programs where this is of interest and benefit.

It is indeed a privilege for the Yukon to host the Ministers attending this circumpolar conference. I am sure the Yukon’s warm hospitality will be felt and enjoyed by all participants. Furthermore, I am confident the meeting will be productive, and will serve educational interests of northerners around the world.

Thank you.

Speaker: This then brings us to Question Period.


Question re: Government fiscal controls

Mr. Phelps: I have some follow-up questions from yesterday’s Question Period regarding the big chill and the effect the federal deficit reduction measures will have on the Yukon’s economy.

Yesterday, in response to my question about renegotiating the Economic Development Agreement, the Minister of Finance said, and I quote from Hansard, “The federal government, for its part, has not shown willingness to provide any guarantee past the next two months and has, in fact, indicated that any renegotiation past the two months, for the balance of the fiscal year, will include terms that are not as favourable for the Yukon as they were previously.”

Can the Minister be more specific and tell us of what terms he is speaking?

Hon. Mr. McDonald: There are a number of terms and conditions that would be associated with any particular agreement that may be negotiated. One of the more significant terms under current discussion is the cost sharing.

Mr. Phelps: On CHON FM, the Minister was interviewed and this morning was quoted as saying, “However, we are aware that federal departments are now showing a sort of reluctance to proceed with even short-term agreements with the Government of the Yukon of a standard nature.

The newscast further said, “McDonald said those signals may mean there will not be another Economic Development Agreement, and if there is, he says, it would be under unfavourable terms.”

I am wondering when the government first received these unfavourable signals from the federal government?

Hon. Mr. McDonald: On March 16 the Public Works Minister, Mr. MacKay, confirmed that negotiations for the Economic Development Agreements - across the country, not only in the Yukon - would halt until such time as the federal budget hit the floor of the House of Commons.

Mr. Phelps: Had the Minister received any of these signals when he released the budget on March 9 with a news release which said, in part, and I quote from the Minister, “The continued growth forecast for the Yukon’s economy will provide us with a strong economic base that will make it possible to carry out our plans.”

Was he aware of those signals at that time?

Hon. Mr. McDonald: I do not believe there were any signals that the Yukon government or the Yukon public could bank on at that point. In the last few weeks or so it has become manifestly obvious to anyone negotiating anything with the federal government that the federal departments are planning the anticipated federal budget. It was anticipated that the federal budget would be brought down early in April. Today, in fact, was the operating date on which we were anticipating the budget.

It has been turned back, subsequently, to the end of April, perhaps early May. The federal departments are clearly reluctant to enter into negotiations on certain agreements. The training agreement is another example, where it may commit them past only a few months or past the federal budget itself.

Question re: Government revenues

Mr. Phelps: We have an abrupt change in regard to the forecasting done by this government and by the Minister. The Minister apparently has a change of heart about the future federal transfer payments to this government as well. Again, on the news this morning, “Piers McDonald says,  that there may also be a threat to the Formula Financing Agreement, which has allowed the Government of Yukon to bring in healthy budgets over the last few years. McDonald says if those two deals are affected, it could cripple the Yukon economy.” Is the Minister contemplating any amendments to the budget we are debating right now in this House, in view of the complete about face regarding his optimism about the prospects for our economy?

Hon. Mr. McDonald: I did not say that changes in the formula financing negotiations would cripple the Yukon economy. I indicated that I felt the Yukon economy was quite independent, and improving substantially. At this point in the discussions, it appears there are signals on the immediate horizon that we have recently received that indicate the revenue picture for the government may change. We have not received anything in writing from anyone in particular that the revenue picture for the government will go down. We do read the signals in the country, as anybody else does and, given what has been happening in the last few weeks, we have reason to be thinking about the future of negotiations for a variety of reasons. I would say it is a wrong assumption that the economy would be crippled simply because government expenditures may go down. That would be irresponsible.

Mr. Phelps: I am glad the Minister is attempting to clarify that. It was attributed to him and was heard by a good many Yukoners. Does the government think it may have to increase taxes or impose new taxes in the next few years?

Hon. Mr. McDonald: The Government of Yukon is not contemplating increasing any taxes or imposing any new taxes on the Yukon this year.

Mr. Phelps: Is the government going to be cutting spending over the next two years? If so, where does it intend to cut spending?

Hon. Mr. McDonald: I give the Member for Hootalinqua full marks for trying. The revenue picture of the government is something that will be taken into consideration. The expenditure picture of the government is something that will be taken into consideration when we review the total budget picture for this government when either revenues or expenditures change.

We will not be introducing new taxes this year. Any changes to either expenditures or revenues will be dealt with at the appropriate time when the situation requires it.

Question re: Government revenues

Mr. Phelps: I was trying to clarify what the Minister was saying to me, to Members in this Legislature and to the public. Is the Minister then saying they are not reviewing their economic picture right now, and are not making contingency plans?

Hon. Mr. McDonald: Internally, we are making best-guess projections about what may happen, given a variety of scenarios. We have not received any indication whatsoever that our revenue picture will decline. The government will be reviewing its expenditure plans when it is clear there may be any changes in our revenue picture. Until that time, Members will have to wait.

Mr. Phelps: I am sorry, but I took yesterday’s answers and the news reports that I listened to and read about, and what the Minister has said today, to indicate there were clear signals there may be reductions. Is he saying he has not said that, or is he saying they will not be reviewing their spending and tax position until they know there will be reductions and how much they will be? Does that mean they are not doing anything about it right now, in terms of contingency planning?

Hon. Mr. McDonald: The Member is quite intent on pursuing the scenario that the revenue picture for the Yukon is definitely going to decline. He may have information that I do not have, given his connections in Ottawa. He is intent on spreading the view that, whatever happens after the federal budget, the economy will suffer a gloom and doom scenario, which perhaps is the Conservative agenda. However, the Government of Yukon has received no signals from any federal Minister that the revenue picture for the government will decline. We do read signals across the country. We do read signals during our negotiations with federal departments. Depending on the character of negotiations, each department does plan for a variety of scenarios that might be the outcome of any particular set of negotiations.

The scenarios would ensure that, no matter what happens, we get the best deal for Yukon residents.

Question re: Government fiscal controls

Mr. Phelps: The people of the Yukon simply want to know what the Minister is saying. I do, too. I ask the questions innocently and he is the one who has come out gloomy.

He is the one who has talked about signals, saying that it means there may not be another Economic Development Agreement beyond two months or they may be canceled or the terms may be negative and so on. All I am trying to do is find out exactly what the Minister is trying to say on behalf of the taxpayers in the Yukon. Is he changing his mind now and saying that we are going to have a new Economic Development Agreement that will be just as good as the one we enjoyed over the course of the last three years? Is that what he is saying?

Hon. Mr. McDonald: During Question Period yesterday and so far today the Members have been couching all their questions in terms of what happens if there is a worst-case scenario for the Yukon. What is the government doing if there is gloom and doom? What happens if there is a dark-sky scenario for the Yukon? I am obviously responding to the questions about the possibility of there being a gloomy scenario, but I have indicated to the Members already that I do not feel that the picture is bleak for the economy of the Yukon. I believe that there are signals on the horizon that may change the revenue picture of the Yukon. We have received no clear indication whatsoever from the federal government, and we have been stating our case quite clearly to federal authorities and Ministers with respect to the Yukon’s position. It is our belief that Yukon’s revenue picture should not change. We do believe that anything can come from the negotiations. We are fighting hard in the negotiations to get the best possible deal for Yukon.

If the Members want to ask about what can happen hypothetically, I can trade stories, but the fact of the matter is that the Yukon government is responsibly pursuing these negotiations. They are considering both best case and worst-case scenarios, and we have no reason indicated at this point from any Minister that there is going to be gloom and doom as far as the revenue picture is concerned.

Question re: Government revenues

Mr. Phelps: I gather that the Minister is saying that yesterday, when he said the federal government for its part is not showing willingness to provide any guarantee past the next two months and has indicated that any renegotiation past the two months and for the balance of the fiscal year will include terms that are not as favourable to the Yukon as they were previously. He was saying that did not come from the federal government. Is it something that they made up? What is he saying?

Hon. Mr. McDonald: I do not understand the direction of the Member’s questions. The federal government had indicated a willingness to negotiate beyond the two month extension to the Economic Development Agreement. That is clear; they have said so very recently. The signals on the horizon respecting the future are therefore uncertain and that, of course, is of significance to the Yukon

Question re: Government fiscal controls

Mrs. Firth: I, too, have a question for the Minister of Finance regarding financial management and planning of this government.

I would like to say that yesterday when I asked the Minister what his policy was with respect to over expenditures within the departments, he said it was to discourage them. Can the Minister tell us what that means? How is he going to discourage them? Has that been communicated in writing to the managers?

Hon. Mr. McDonald: The policy to discourage over spending at year end has of course been communicated to the managers directly, face to face between Ministers and managers and between the Government Leader and managers. It is a clear policy of the government to discourage over spending. It is also recognized that, at year end, there have historically been expenditures made past the year end for the last 10 years that were unavoidable and were not anticipated. They were part of existing programs encompassed by existing policies and, while we like to discourage those, we realize there are times that they are inevitable.

Mrs. Firth: These historical, unavoidable, unanticipated expenditures that the Minister keeps talking about, that he casually mentions, have occurred two, and in some instances, three years in a row now. It has cost us over $8 million.

Now if the Minister has his books in order, I would like him to tell us what he has done to see that it does not happen again, perhaps four, five and maybe six years in a row. What has he done?

Hon. Mr. McDonald: The Member has cleverly omitted the fact that over expenditures at year end occurred in 1981-82, 1982-83, and I believe 1983-84, and in 1984-85 there were built-in buffers for each department that prevented the over expenditure. But there have been over expenditures at year end, and they did occur before this government came into office. I would like the Member to recognize the fact that it is not something that is of recent making at all.

A control system that was instituted this last summer allows managers to determine the nature and the frequency of spending much more precisely than they ever have in the past, so they can determine expenditure patterns right up to the year end and allow for better management to take place.

Mrs. Firth: Why does the Minister not just debate the question instead of dredging up 1981-82, or whatever? Why does he not just answer the question? He is the Minister of Finance now. He is the one saying his books are in order. I would like him to answer the question. What has he done to see that it does not happen again, so that we do not have it four, five and maybe six years in a row. Commitment control is worn out. We have all heard that six years now. I want to know what the Minister is doing to see that this does not happen again, besides commitment control.

Hon. Mr. McDonald: The reason why I dredge up the year 1981, 1982, 1983, 1984 and 1985 is because those are the years that the Conservative Members opposite, many of them still around, were in government, and those Members who have this extremely high standard of this government are speaking out of both sides of their mouths. That is why I dredge up those years.

The Member opposite has, in her preamble for her question, identified that this is a problem of recent making. The Member wants to leave the wrong impression, that this is something that is the creation of this government alone, and I am correcting that impression now. That is the reason why I bring up those years.

The commitment control system is something that was introduced last summer. The Member may have heard many times in the last months, many times in the past few years, about its development. It came in place this last year. It is a new system for this government, implemented by this government in order to make the year of expenditures more precise.

Question re: Government fiscal controls

Mrs. Firth: What a desperate attempt on behalf of a desperate Minister of Finance. Why does not the Minister debate the question instead of attacking us? Why does he not just answer the question? I would like to know what his government is doing to address the issue the over spending. I would like to ask the Minister, specifically: has he given any direction for periodic assessment of programs to be done? Has he done that?

Hon. Mr. McDonald: It is no act of desperation to institute proper control procedures for expenditure matters in this government. That is not an act of desperation. I am listening to the Member for Riverdale South restate the same election rhetoric from only a month or two ago, and despite the fact that the Conservatives were clearly defeated in the election, she is attempting to bring the same information forward that was put forward then. People did not believe it then. They realized that the government was doing things in a sound, responsible way and that is the reason why the people spoke.

Mrs. Firth: Obviously, the Minister has done nothing and he has given no direction. He has avoided the question again. He has no contingency plan. He has no new ideas. I want to ask another specific question: has the Minister given any direction to his managers to examine the programs annually, to look for ongoing benefits, to look at whether they are out-dated programs or not - has he given any direction to perhaps do something like that?

Hon. Mr. McDonald: The Member is restating the case that she was feebly trying to make. I would like to remind her that saying something many times does not make it so. I am getting the impression that the Member has just gone through a media handling seminar; she has understood now that you have to say something many times and repeat it in short, quick clips so that it makes good radio, in order to get press.

The point of the matter is that the government is acting responsibly. The government has identified what had been a longstanding problem with respect to year-end expenditures that were unavoidable - unavoidable because the public expects the highways to be maintained, the public expects expenditures in medical travel to be undertaken.

The government is doing it not only through very clear communication with managers but, also, through a commitment control system that allows the managers to better identify expenditures they make right up to the very last day of the fiscal year.

Mrs. Firth: This Minister of Finance has no control. His books are not in order. He has no contingency plans. He has given no direction regarding any program evaluation. Has the Minister given any direction to look at firmer guidelines and criteria for the existing programs? Has he given his managers any direction to do that?

Hon. Mr. McDonald: Saying the government has no control and saying the government does not have its books in order, does not make it so. It is false. It is wrong. It is not true.

There are more, significant control features built into the administration of this government than there were during the Conservative government. The books are in order. There are procedures, like program evaluation. There are procedures of internal review. There is now the commitment control system. There has been a message sent to managers to control expenditures at year end. Those things are all in place. Some of them are new to the Yukon government and were never adopted by the Conservative government back before time started.

There are many good things that have happened with respect to financial controls in this government. I do not care how many times the Member for Riverdale South will misstate the facts of the matter, the situation remains that the government has its books in order and is acting responsibly.

Question re: Office accommodations

Mr. Lang: I hope today we can confirm the government has its finances in order and has the proper controls with respect to the management of the administration and, therefore, the civil service.

Yesterday, I asked about what new office space was going to be made available for the 40 or 50 new positions that are identified in the new budget but have not yet been filled. I asked the Minister of Government Services where these people were going to be put, and the Minister did not know yesterday. Could he tell the House today what is taking place?

Hon. Mr. Byblow: I indicated yesterday that Government Services is in the process of developing an overall accommodation plan, and that is accurate and currently underway. The Member has to recognize that that involves discussions with the industry in that it involves the space allocation of buildings in Whitehorse. Specifically, on space allocation for various departmental needs, the Member also knows that the procedure is that departmental requests come through a space allocation committee and are dealt with on a case-by-case basis.

Mr. Lang: The government has identified 70 new positions in the budget we are debating in the House. My information is that approximately 30 of these have been filled. Therefore, there are another 40 or 50 positions that have to have office accommodation to do their job.

Is the Government Services Minister telling us that there are no plans in place for where these people are going to work, nor have they estimated costs of what it is going to cost to fill these positions?

Hon. Mr. Byblow: The Member is suggesting that, out of the blue, there is a requirement for space to house 70 people. That is not the case. To suggest that this is going to be put on the table by the government is inaccurate.

The Member recognizes that a number of the positions can be accommodated in existing locations. A number of the positions involve an increase in teaching staff around the territory or federal transfers, which, in many instances, come with space. Space allocation requirements are dealt with on a case-by-case basis. To follow up on the Touche Ross report, we are in the process of developing an overall plan to fill the needs for that space with the private sector.

Mr. Lang: I find it confusing. The reality is that we are looking at 70 new positions within the government. Is new office accommodation space required for these positions, or can it be combined with the existing office space?

Hon. Mr. Byblow: The Member is overstating the case. Requirements are dealt with under the existing policy, on a case-by-case basis, to find adequate accommodations for government employees. The majority of increases in services provided by the government in the budget are going to be accommodated within the existing facilities. In some instances, they come with space. Requests from departments will be dealt with on a case-by-case basis.

Question re: Office accommodation

Mr. Lang: This is very confusing. The Minister of Finance told us, at great length, what good financial control he has on government finances. At same time, the Minister of Government Services advises he does not know how much office accommodation is needed, because he is in the process of getting a plan together. As the Minister is in the process of putting a plan together, could he tell us why it was publicly announced on March 21, 1989, that the Department of Health and Human Resources would move out of this building and rent a proposed new facility on Second Avenue by Ray Street? What is the cost of this move?

Hon. Mr. Byblow: I am not sure what the Member is seeking by his question. The proposal was sought and the successful award is currently in progress. If the proponent can provide the space, it will be utilized. The Member is aware that it relates to the Touche Ross report indicating the need to relocate some office space from this building. Should that not materialize, there will have to be a new tender called that may delay the relocation.

Mr. Lang: What is the cost of this venture the Minister has outlined with respect to moving the Department of Health and Human Resources?

Hon. Mr. Byblow: It is under current policy guidelines relating to standard leasing prices.

Mr. Lang: There is nothing standard in leasing prices. It all depends on the facility. What is this going to cost the government? The Minister must have that. They talk about the plan in place; just give me the numbers.

Hon. Mr. Byblow: The Member may not be aware that the proposal that came forward from Steele Developments has essentially collapsed because the City of Whitehorse will not provide the zoning for the facility. In that respect, I cannot provide precise figures. There is no deal.

Question re: Office accommodation

Mr. Lang: Three days after the election, on February 23, one branch of Government Services moved out of the justice building to another building a block and one-half away. Could the Minister of Government Services outline what other relocations are contemplated to make way for these new positions they are planning to hire over the course of this year?

Hon. Mr. Byblow: If the Member seriously expects an answer he can give me notice. I will take notice on the question.

Question re: Tourism Economic Development Agreement

Mr. Phillips: I have a question for the Minister of Tourism regarding the regarding the Tourism Economic Development Agreement.

Can the Minister advise the House why this government has allowed $2 million to lapse and to be turned back to the federal government, when tourism, one of the mainstays of the economy, is down and may go down further. Why did the Minister allow this to happen?

Hon. Mr. Webster: It was not so much a matter of the government allowing this to happen. Unfortunately, at the time the EDA was negotiated five years ago, the Government of Yukon and the industry itself was not in a position to start processing applications. We had a one-year delay. That accounts for the one-year delay in not processing applications and using the money.

Mr. Phillips: The EDA money, the $2 million has already been budgeted by the federal government. It appears now that we are going to be losing these funds. We made strong arguments for the $10 million when we negotiated the EDA. I wonder if the Minister could explain how the government is going to be able to effectively negotiate for more money for tourism under the new EDA when it is not using the money it receives now.

Hon. Mr. Webster: I will try to point out to the Member the very good reason why we were not able to make good use of that money, which I think is a reasonable one and one we can use with the federal government, convincing them to give us the same amount of money for another EDA.

Mr. Phillips: I do not understand the Minister’s logic. If they wanted to borrow $10 million from me, and I had loaned them $10 million and they only used $8 million and said they wanted to borrow $10 million again, I would ask them why. I wonder if the Minister could tell us what contingency plan this government has in place considering the messages being sent from Ottawa that the EDA funding may not be continued. What contingency plan does the Government of Yukon have in place to provide funding for this very important economic agreement?

Hon. Mr. Webster: The contingency plan we have in place is to lobby the federal government for an extension of the one-year period so we do have that original five-year period renegotiated to spend all the money that we asked for.

Question re: Tourism Economic Development Agreement

Mr. Phillips: The Minister of Finance rose in the House yesterday, and I believe again today. He told us that one of the Ministers in Ottawa said that there would probably be no more EDA funding. Based on that statement, what contingency plan does the Government of the Yukon have in place that could replace the EDA program, which was a very useful program? I might point out that Target Downtown, the Main Street Beautification and Convention Promotion were a few things that were done under that program. What other contingency programs does the Government of the Yukon have to provide this kind of funding?

Hon. Mr. McDonald: The Member has misquoted me once again. It seems to be a habit within the last few days. I did not say that a federal Minister today or any other day said that there would be no more EDA. I indicated that the negotiations would be frozen until after the federal budget came down. At that point, the negotiations for further Economic Development Agreement funding will be undertaken.

Mr. Phillips: Everybody else in the world except this government is getting the message about the EDA program. Last week on the national news the Minister responsible for the economic development program in Nova Scotia announced that they were considering upping their percentage to 50 percent so they could get some of the EDA funds. Is the Government of the Yukon considering a different percentage? I believe now it is 90/10. Are we considering a 50/50 share? It would at least get some money from Ottawa for these very important programs.

Hon. Mr. McDonald: First, we are in negotiations and it would be inappropriate to indicate what the bottom lines are with respect to cost sharing. But now the Member is advocating that we opt for a 50/50 share when the Government of the Northwest Territories just achieved an agreement with a 70/30 cost share. I believe that it is in the interest of the Yukon to get a better agreement than obviously what the Conservative Member is advocating.

Question re: Yukon government annual report

Mrs. Firth: I have a question for the Minister responsible for the Executive Council Office. Within six months after the end of each fiscal year a report summarizing the activities and affairs of each department of the government is prepared and made public. This is of course the annual report, which is information to the public, and it is used by the media also.

I would like to ask the Minister: where is the annual report for 1987-88, which should have been ready in October.

Hon. Mr. Penikett: I will have to take the question as notice. I do not know exactly at what stage of preparation the annual report is, but I know that, for a number of years, for reasons of printing and preparation and others, that it has been late. That was a problem previously; I hope that it will not be much delayed. I hope I will be able to report back Monday as to when exactly we can expect it.

Mrs. Firth: It is now almost six months late, and this is the second time this has happened. Why is it being delayed? What is the problem that causes this delay for two years in a row?

Hon. Mr. Penikett: I have already taken the question as notice.

Question re: Highway pull-outs

Mr. Brewster: On April 27, 1988, this House passed a motion regarding the creation of more pull-outs along the Klondike, Campbell and Alaska Highways in order to provide adequate safety for the general driving public. A particularly bad situation exists at the intersection of the Takhini Hot Springs Road and the Klondike Highway, which could be rectified by putting in an additional lane.

Since almost a year has passed, can the Minister advise the House when the public can expect some action regarding this pull-out?

Hon. Mr. Byblow: I am working strictly from memory, but I believe that is in the budget we are debating in Committee now, and we will see the creation of a pull-out lane.

Mr. Brewster: Can the Minister advise the House regarding what additional pull-outs will be constructed along the Alaska Highway as a consequence of the Yukon government’s representation to the federal government in this regard?

Hon. Mr. Byblow: I must take the question as notice. I will provide the information to the Member.

Speaker: The time for Question Period has now lapsed. We will now proceed with Orders of the Day.



Bill No. 28: Second Reading

Clerk: Second reading, Bill No. 28, standing in the name of the hon. Ms. Joe.

Hon. Ms. Joe: I move that Bill No. 28, entitled Day of Mourning for Victims of Workplace Injuries Act, be now read a second time.

Speaker: It has been moved by the Minister of Justice that Bill No. 28, entitled Day of Mourning for Victims of Workplace Injuries Act, be now read a second time.

Hon. Ms. Joe: I am pleased to bring forward for the consideration of the House the Day of Mourning for Victims of Workplace Injuries Act. The Yukon government has, for the past two years, recognized April 28 as a day of mourning for workers killed or injured on the job. In Canada, there are approximately 1,000 deaths per year due to industrial accidents. Thousands more are permanently disabled, hundreds of thousands more are injured, and thousands more die from cancer and lung disease from exposure to toxic substances in the workplace. It is important that we pay tribute to these workers who have been lost or disabled or injured.

In the past, this recognition has been given through a proclamation by the Commissioner of the Yukon. The consequences of worker fatalities and accidents are sometimes hard to determine, but we know that these occurrences result in emotional and economic hardship for the workers and their families.

April 28 should be a day to remember the sacrifice others have made in order to make a living. April 28 should be a day for all levels of government to increase their occupational health and safety standards. April 28 should be a day to dedicate ourselves to making the Yukon a safer workplace.

The Canadian Labour Congress across Canada has long recognized April 28 as a day of mourning for workers. Last fall, the Federation of Labour requested the Minister of Justice to introduce a bill that would permanently recognize April 28 as a day of mourning.

I am pleased that this government has been able to act positively on the request of the Federation of Labour, and that I am now able to sponsor the Day of Mourning for Victims of Workplace Injuries Act at second reading.

Mrs. Firth: We on this side agree with the principle of this piece of legislation. I want to take the opportunity to congratulate those individuals who do work within the Department of Occupational Health and Safety and those who work with the Workplace Hazardous Information Systems, on their efforts to make the workplace a safer place for employees and encourage them to carry on with their efforts.

We are very fortunate in this government to have very capable individuals working in those areas. I would also like to tell the Minister we would anticipate a speedy passage of this piece of legislation.

Motion agreed to

Bill No. 33: Third Reading

Clerk: Third reading, Bill No. 33, standing in the name of the hon. Mr. McDonald.

Hon. Mr. McDonald: I move that Bill No. 33, entitled Third Appropriation Act, 1988-89, be now read a third time and do pass.

Speaker: It has been moved by the Minister of Finance that Bill No. 33, entitled Third Appropriation Act, 1988-89, be now read a third time and do pass.

Mrs. Firth: Just before we pass this Supplementary Estimate, I would like to raise a few concerns that we on this side of the House have. I hope I am at liberty to do this, considering we did not win the election. The Minister opposite feels that, because they won the election, we no longer have the right to stand here and raise questions about the financial administration of this government. I hope I am not stepping out of line here.

I would like to raise a few points about the Supplementary Estimate. First of all, the government is asking for an extra $22 million and an extra 120 new person years, as well as various new programs. We have been responsibly and conscientiously raising concerns about the financial planning and the financial management of this government. We are not the only ones who have been doing that. The Auditor General has been bringing it to our attention as legislators, and to the public’s attention. The Public Accounts Committee has been bringing these concerns forward. Despite what the new Minister of Finance says, there are many expressions out there in the public about the spending habits of the government. The Minister may not have heard any of them during the election campaign, but I did.

We have a government that has launched a totally new agenda. It has moved from an economic agenda, which is a revenue-generating agenda, to a social agenda, which has not been a revenue-generating agenda in previous governments that have moved in that direction.

I would like the government to exercise some caution when it comes to the expenditure of funds. It is fine for the government to say we have only had a three percent person year increase this year, which only represents 70 new people; we have embarked on a social agenda; we are going to look after the people in the area of health. The Minister of Justice says that is fine. We are going to look after everyone; we are going to have new day care programs; we are going to do all kinds of things that cost money.

This Supplementary Estimate of $22 million is going to impact on the surplus funds that the government has. I know that the Minister is going to stand up and say that well, we have a surplus of $45 million, we have more surpluses than the previous Conservative governments left behind - all of that tired old rhetoric that we keep hearing from the Minister of Finance and from the side opposite on how things are better now.

Another year of spending like this and we are not going to have a surplus of $45 million; we will be broke. I know the Minister will stand up and say that there will be lapsed funds and capital and we will have all this extra money.

Those are exactly the concerns we have been raising about financial management. I have gone to budget briefing sessions and I have asked about the over expenditures in the government and whether or not they were built in to the next budget. I was told no, they were not. It is this Minister who is now in control of the books and responsible to see that some new initiatives and creative things are done to get costs under control and to get budgets under control.

I want to exercise caution that, from the responses we have had in Question Period in the last two days, I do not get the feeling, and I am sure my colleagues do not get the feeling, that this Minister is bringing in any fresh, new ideas, or giving any direction other than that he wants to discourage over expenditures.

The public is just finding out about the potential price of the big chill, or whatever people want to call it, that is going to happen as a result of federal restraint programs. This government should have known long ago that that potential was there. The federal government has been talking about it for a long time now. It is not something new that has just happened overnight. I would have anticipated that this government would have been doing its homework, and doing some sound financial planning, that it would have some contingency plans in place, have some projections ready, in light of its agendas and what it hopes to achieve in the next few years, but we have not received any responses from the Minister to indicate that that is in place.

So, before we pass this and the government merrily goes away with its extra $22 million, I just feel I have a responsibility on behalf of the constituents I represent, on behalf of the taxpayers of the Yukon, to stand up again and state that there is room for improvement, and that there is room for contingency plans, and room for examination and analysis of what the government is presently delivering to the public. I do not want to be broke after another session and another supplementary estimate, and I do not think other Yukoners want that to happen, either.

Hon. Mr. McDonald: I thank the Member for her remarks but allow me to present a few observations on what the Member has said and perhaps restate a couple of points that have been made in Question Period in the last couple of days.

I do not dispute the Member’s right whatsoever, or any Member’s right in this Legislature, to come into this Legislature and speak their minds on expenditures of the government. I think that is the hallmark of the democratic system. They do have the right. There is also a party system in the territory and the party system is a very useful tool. We all defend it. The party system indicates the relative values, principles and proposals of various parties, presents them before the public and the public decides which party it prefers. The point that I was making today was that, clearly, the public prefers the government side. For that reason, the policies and the principles of the government’s side are the policies and principles that we feel comfortable with and that we feel we should be pursuing in this Legislature.

The Member has brought forward the position that because this is a supplementary, that this is an example, and she has tried to make a case in Question Period of wanton over spending, and she tries to make the case that this is the example of how the NDP government operates.

There have always been increases to the main estimates via the supplementary estimates. A quick analysis from 1980-81 to the present shows that the percentage increase has been less than in the last two years of the Conservative administration. The Member is constantly trying to deny the fact that there is any use in providing, for comparative purposes, a history of how the Conservatives, many of whom are still here, operate in government. The whole electoral process is about making choices. The choice is between the experience the territory has had with the Conservatives and the experience that the territory has had with the New Democrats.

In the last few years, the percentage increase has dropped from our experience in the 1983-84 and 1984-85 periods regularly on an annual basis to the present. That is not fantasy. That is reality. The facts speak for themselves. The supplementary estimates, as a percentage of the main estimates, are regularly decreasing from the last years of the previous administration. This hardly reflects out-of-control expenditures. The facts speak for themselves with respect to fiscal management.

In 1980-81, the percentage increase of the supplementary estimates over the main estimates was four percent. In 1983-84, the percentage increase of the supplementary estimates over the main estimates was 17.5 percent. In 1984-85, it was 18.6 percent. Ever since then, the percentage of increase over the main estimates has dropped regularly. It has dropped 14 percent down to 11 percent, then down 7.3 percent over the mains. Not only that, but the government is now budgeting items, such as the employee leave accrual, which in one year was $10 million, that the Conservative government never had to expend. The territorial government also expended $29.5 million through one supplementary one year as a special one-time equity grant to the Yukon Development Corporation.

The Members opposite are complaining that they have heard this speech before. There is one element of this speech they have not heard before. The Members opposite have no faith in the budgeting of this government. But let me quote from a revered Canadian. He is a person I am sure we all respect. The Member for Hootalinqua refers to Mr. Ed Broadbent. Yes, he is very much a revered Canadian. But let me quote from a letter only received yesterday, addressed to yours truly, Mr. McDonald; “Dear Mr. McDonald: Please accept my congratulations on your recent re-election and your appointment to the Finance portfolio. I appreciate Yukon’s commitment to fiscal responsibility as demonstrated by the expenditure restraint you have shown in your 1989-90 budget”. It is signed, “Yours sincerely, Michael Wilson”.

I think this is a wonderful vote of confidence from the federal Minister of Finance. It puts in line all the tired politics and tired old rhetoric that was so much a hallmark of the Conservatives both prior to, and apparently after, the election.

Motion agreed to

Speaker: Bill No. 33 has passed this House.

May I have your further pleasure at this time?

Hon. Mr. McDonald: Mr. Speaker, I know you found it entertaining, but I would now move that you please leave the Chair and that the House resolve into Committee of the Whole.

Speaker: It has been moved by the hon. Government House Leader that the Speaker do now leave the Chair and the House resolve into Committee of the Whole.

Motion agreed to

Speaker leaves the Chair


Chair: Committee of the Whole will now come to order. At this time we will have a recess.


Chair:  I will now call Committee of the Whole to order.

Bill No. 51 - First Appropriation Act, 1989-90 -continued

Chair: We will continue debate on Bill No. 51, First Appropriation Act, 1989-90. I refer Members to page 93, Community and Transportation Services, Capital Expenditures, Community Services Program, Recreation and Community Facilities and Services.

Recreation Facilities in the amount of $834,000 agreed to

On Rural Electricfication

Hon. Mr. Byblow: I apologize for the delay. There seem to be many papers here to sort out. The rural electrification program, as Members are aware, is a program to assist with the provision of electrification to rural areas, and it is structured on a recovery basis to a frontage charge. The program was expanded to include telephone and that is what this money is identified for - to provide for those capital costs in the areas where it may be needed.

Rural Electrification in the amount of $200,000 agreed to

On Whitehorse Waterfront Development

Mr. Lang: Could the Minister tell us how much is committed in this year for the waterfront development in view of the commitments made during the election?

Hon. Mr. Byblow: The only dollars that have been expended and are committed are the cost-sharing dollars for the study in the amount of $20,000 - our portion, along with the additional $20,000 from the City of Whitehorse and, I believe, White Pass. That is all that is committed at this point.

Mr. Lang: When is that particular study due to be completed?

Hon. Mr. Byblow: My understanding is that it is expected about mid-May. At approximately that time, a public presentation is expected to be made and, sometime before that, I will be in a position to review it with the city and White Pass.

Whitehorse Waterfront Development in the amount of one dollar agreed to

On Capital Block Funding

Mr. Brewster: I would like you to rule on something that I would like to go back to. I was given some facts that I think we should get straight before this is passed. You will have to make a ruling on it. I realize going back is illegal. However, I will not argue with you, Madam Chair, as I have sat in the same chair and realize how hard it is. Rest assured, I will be getting it back into this Legislature.

Chair: I would like to ask the Member at this point to which point he would like to return.

Mr. Brewster: I would like to go back to the ambulance at Destruction Bay, as well as the sewer and water contracts and tenders.

Chair: Is that on the same page?

Mr. Brewster: It is on the same vote on page 93.

Chair: Is there unanimous consent of this House to go back to ambulance services?

All Hon. Members: Agreed.

Chair: There is unanimous consent.

Capital Block Funding in the amount of $9,129,000 agreed to

Chair: We will now go back to ambulance services.

On Ambulance Service

Mr. Brewster: I do not get up very often, and I do not appreciate people not giving me facts. It was indicated by the Minister that everybody was happy and rosy in Destruction Bay. I will now give the facts of the case.

The department was up there on Wednesday. They are going ahead with their training room, as per usual. It is not built yet. They have the ambulance and the fire truck in the same building. To satisfy the people, they have now pulled out the washroom and toilets so they can get to one and get in the door to get out. I asked if they were satisfied, and they said, what can you do? It is a 50-50 compromise, and they are not happy.

I am not very happy when people come into the Legislature and indicate that I do not know what I am talking about.

Hon. Mr. Byblow: The Member must realize I gave him the information to the best of my knowledge at the time. From what the Member says, I suspect we were discussing it in this Legislature virtually at the same instant discussions were going on in Destruction Bay. Is that correct? Yes, it would appear to be so.

I have some new information that appears to have been provided just an hour ago. It refers to some differences that exist in the design of the fire hall. This is new information thatwas given to me only an hour ago.

The Member appears to be correct in that there seems to be some disagreement regarding the construction of that hall. Some people appear to want the new addition to be a bay for the ambulance and leave the existing hall for a training room, while others want to build the addition for training and leave the existing hall as it is.

The compromise the Member spoke to is one that I would like to discuss further. This is somewhat new information to me, and I am certainly of the mind that we should meet the requests of the community where reasonably possible and as often as possible; it is a facility that the community plays a part in designing and operating. I would just exercise the caution that we must erect the facilities to meet the required codes and standards that have to be met. I am willing to discuss this further. Does the Member know precisely what the community wants?

Mr. Brewster: I would like to inform the Minister that I do not necessarily blame him. I would like point out that this battle has been going on for a year and one-half. Nobody seemed to want to cooperate or listen to the people up there. It was indicated in this Legislature that the people were all happy and I do not blame the Minister. It was passed on by the department. I am a little sick and tired of this kind of thing going on.

Number one, you pull out the washroom. They use that fire engine to fight fires and now apparently will not have any shower or washroom to clean up in after they come in with mud all over them or when they dry the hoses. I think that is kind of ridiculous and doubt if that even meets the code. They asked to have this building built so that they could put their ambulance in the one they are putting their training room in, and have their training room in where the ambulance had been. I do not think the cost would have been any more and everyone would have been satisfied.

Too many of these organizations go out to these communities and come back saying the communities agree with them when the communities do not. I can look back to the days when Commissioner Smith was here. I remember attending a meeting where they were going to take our fire engine, which the community of Haines Junction had bought, and the bureaucrats decided to bring it to Whitehorse. We had bought it and trucked it up from Fort Nelson and they took it away from us. There were 75 people at that meeting who told them they wanted that fire engine. I met Commissioner Smith the next day in town and they came back and said that everything was rosy. This kind of thing has got to stop. If you are going to listen to people then do it.

Hon. Mr. Byblow: I take the Member’s remarks seriously. I thought this issue was resolved well over a year ago. I guess I am disappointed that it is still continuing.

If the Member is willing, perhaps tomorrow, he and I can meet with the people from the branch and try to resolve this once and for all.

Mr. Brewster: I appreciate that, and we certainly will be at their beck and call tomorrow. I also, although it was a year ago, appreciate the fact that I am dealing with this Minister and not the present Minister of Finance, because he would have torn the hide off me for making the same statements. He is mean, Madam Chair. Believe me, he is a heavy hitter.

Chair: Are we finished with ambulance service?

Ambulance Service in the amount of $282,000 agreed to

Mr. Brewster: Yes, I would now like to go back to the water and sewers, if permissible.

Chair: Is there unanimous consent to go back to water and sewer treatment? If so, which one? There is water supply, treatment and storage, $1,770. Below that there is water and sewer mains.

Mr. Brewster: Water and sewer mains, Madam Chair.

All Hon. Members: Agreed.

Chair: There is unanimous agreement.

On Water and Sewer Mains

Mr. Brewster: I would just like to bring up another thing and this is the statement that the Minister made to me, “ There are two big ones in the category of 14-odd water and sewer activities. One is an anticipated activity for $700,000, to be done this year in Haines Junction. That would be managed by the municipality and it will probably be tendered.”

I phoned the municipality twice today; it has nothing to do them. They have never issued the contact; they have never seen the money. The money does not come to them; it goes strictly to the band. What I was trying to get at from the start is that all these large sewer projects are going to the band and they are not open tenders.

Hon. Mr. Byblow: The information that I am being provided is that we appear to be talking about two projects. There is clearly a $700,000 project under the administration of the municipality treated as an extraordinary funded project; in fact, under the block funding arrangement this is a project that falls into the category of being larger than the two and one-half times limit. This is obviously a portion of that project. The municipality gets its block fund, for x dollars. The $700,000 is for a part of a water and sewer project that, in its over-all cost, is beyond two and one-half times that permitted. That is my understanding of that project.

There is an additional project relating to work in the Indian village, a piped water project, for $400,000. There is an additional project to the $700,000 one being looked after the municipality for $600,000.

Mr. Lang: Just for clarification, is this total package then $1.3 million?

Hon. Mr. Byblow: Between the two projects, yes.

Mr. Brewster: I think the Minister and I are getting the squeeze put on us. I made two phone calls and the last phone call I made was to the manager of the municipality and I said: tell me what I want, because I am going into the Legislature and do not cross me up because if you do I will be out there this weekend. She said that the $700,000 has nothing to do with the council, that the council never saw it. She knows of it because of the plan to connect it to the same water hook-up, and that this money would be handed directly to the band. Why would she say $700,000 and you are saying $600,000; somebody knows something they are not telling us.

Hon. Mr. Byblow: I am trying to get a clear picture so I can provide accurate information to the Member. I will try to put my understanding of the projects in context.

There is an extraordinary funding arrangement with the municipality to upgrade its water and sewer system. The total amount of the project, over a three-year period, is $1.7 million. There was $75,000 spent last year in design and assessment work. There will be $700,000 spent to develop the system this current year, being year 2 of the municipality’s project. This will include a water storage facility, a treatment facility and a booster facility, which of course will involve pumping and ground water sourcing. Year 3 of the municipality’s water and sewer system installation project involves an additional $1 million for the required piping and trenching et cetera.

It is a three year, extraordinarily-funded water and sewer project. The project has the support of the municipal branch here, but it is in the hands of the municipality. They would be responsible for the required tendering, approvals and so on.

The $600,000 expenditure being undertaken with the band for water and sewer work in the Indian village is separate from the $1.7 million. Together, they total $2.3 million.

I hope this clarifies the scope of these projects. They are two separate projects. This is year 2 of a three-year project on one. The other is a single year activity.

Mr. Brewster: I will go back to my original question. Governments do avoid answering properly.

I have received telephone calls from a number of contractors in small communities where sewer and water lines are going in. They are concerned that this may not be an open bid. Is this true?

In Teslin, $460,000 went to the band with no open bid. Now $600,000 went to the band with no open bid. Is Carcross going to be another closed bid?

Hon. Mr. Byblow: I cannot answer the question on Carcross. It is premature, but the Member has flagged the issue. I take it as notice. Is the Member reasonably clear about the funding of the two projects in the Haines Junction area? It is a three-year program on one and a one-year program on the other?

Mr. Brewster: I am clear on that. My original question was whether all contractors would be able to give bids on this. There is a $1 million that you tell me is not going out to open tender: $460,000 in Teslin, and $600,000 in the Champagne/Aishihik area, which is inside the Haines Junction area.

Hon. Mr. Byblow: I do not want to quibble with the Member. I was clear in our discussions yesterday. The nature of these projects varies from community to community. Some are undertaken by municipalities and some by bands, in conjunction with us. I said that the $700,000 in Haines Junction was a municipal responsibility and part of an extraordinary funding arrangement. I did not say it was part of a three-year program, because I was not as familiar with the project as I am today.

As I indicated, we sometimes undertake capital assistance agreements where the authority of the area may be a band. That is not always the case, but it often happens. I have provided to the Member for Porter Creek East all the capital assistance agreements undertaken in the last year. Agreements undertaken with other than band local authorities show up.

The short answer is that, in some instances, where bands are involved, these capital assistance agreements are struck. Where municipalities are involved, it is their responsibility. Where we have the responsibility in an unincorporated community, we may well be the responsible agents who put out and oversee the public tender. It summarizes down to three different methods.

Mr. Brewster: That is another example of money mismanagement. How to you get the biggest bang for a buck, when you have one person doing it and no one bids against them? It does not make sense. I do not care if it is a band or a contractor or who it is, if you do not have bids, you do not get it. When we asked about the $600,000, he also stated that it is under our jurisdiction and that it is going to be publicly tendered under standard tendering procedures. From reading that, one would think that it meant that these others would be under standard tendering procedures.

Hon. Mr. Byblow: In respect to the $600,000 and the citation of the Member, it is not yet determined at this point how the project will go ahead for the Champagne/Aishihik portion. We do not have a capital assistance agreement with the band. We have not yet gone to any public tender. It has not been decided, and I cannot predict at this time how it will happen.

The Member raises considerable concern about us striking capital assistance agreements with some bands in some communities to put in these water and sewer services. I want him to understand the worthwhile and useful exercise that provides to the community. We oversee the project, in terms of making sure it is, from an engineering standpoint, properly and competently done. There is an insurance, when you undertake these kind of projects with bands, that you provide things like local labour and you provide an element of training. It has its value to those communities, as well as it being the wish of those communities. We do not foist this on them. We do not force them to do these jobs. It is a simple consultative approach that is undertaken: fair, upfront and above-board.

Mr. Brewster: I do not have any problems with the bands getting these, but let me point out that the bands can turn around and bid on the others. In other words, they have two against the others, and this is very unfair. Other contractors who have the equipment can only bid on 50 percent of the deal, when the bands can bid on 100 percent of the deal. Once it is a closed bid, you are not even getting the best for your money. I am not saying they cannot do the job. They can do a very good job, but you are not getting your money. When any contractor gets a closed bid, he is going to add on to it. Why would he not?

You put $600,000 in the budget, and he is going to take $600,000. Why would he not? Anybody would do that. That is why contracts for government things get so big. The minute you put that down in print, that is what they bid. They do not bid against anybody else. They say there is $600,000, let us go get it.

Hon. Mr. Byblow: I would like to reassure the Member that, in the instances where these projects have been undertaken by a capital assistance agreement, we have a close review of the project on an ongoing basis. The Members have copies of those agreements; the project latitudes are set. If the Member is suggesting that, somehow, there is padding that goes on to the project, it is not the case. We set the budget; we set the standards; we cost the job out, and we oversee its activity and provide a considerable support to that community in the process.

Mr. Lang: My colleague from the constituency of Kluane is not complaining about the work being done in the community. It is a question of how the process is being undertaken.

Work done under the territorial government is publicly tendered. Is it not common practice to have major capital projects publicly tendered, even if they are being managed by a municipality?

Hon. Mr. Byblow: As a matter of principle and general practice, yes. Under capital assistance, you can strike the special arrangements for those contracts to be cooperatively delivered.

Mr. Lang:   There is a very important issue here. What I dislike so intensely here is that if I am a white man and I happen to be in the community of Haines Junction, I can not have the opportunity of bidding on a water and sewer project because it happens to be under the auspices of the Champagne-Aisihik Band. What I am saying here is that I think you should take note, in more and more of the communities, and especially the smaller communities, people are getting fed up with it. All they want is fairness. That is what people are saying, and you should be listening to that.

I have no problem with the Champagne-Aisihik Band administering the project as long as they have the expertise and the administrative capabilities to do it. My concern is fairness in spending the taxpayers’ dollars, so a contractor, for example, in Haines Junction has the opportunity to bid on that $600,000 contract. That is all my colleague from Kluane is asking for. If the Champagne-Aisihik Band’s corporation bids and is successful, go ahead and do the job. No problem. But you can not tell me that you are going to give Dan Lang $400,000 to do a water and sewer project and then try and tell me to do it for $300,000. I will do it for $400,000.

The concern being expressed here is that we are all people. There are companies doing business. Whether it be owned by Indian people, white people or both, whatever, there is a procedure that is followed for the purposes of ensuring that the taxpayers dollars are given, number one, public scrutiny and number two, the best clout for your dollar.

I guess my question to the Minister is: would he ask, as a requirement of these contract expenditures, that part of it has to be publicly tendered so everybody gets an opportunity to put a bid in?

Hon. Mr. Byblow: I have listened to the Member’s representation and one of the points that stands out is the suggestion that, in the capital assistance agreements that are struck in instances such as in Teslin, there is some padding to the job. We have costed the job. There is a legal agreement struck. There is supervision applied. It is valuable to that community. That community is the one that is asking for the service, providing the service, encompassing a component of training and doing the work for its own community. Let me ask the Member a blunt question. Recognizing that there is no padding or no profit to the project, it is a ...

Some Members: (Inaudible)

Chair: Order, please. Let the Member finish.

Hon. Mr. Byblow: Let me ask the Member opposite. Does he think that it is more fair to let a contractor from Whitehorse go into the Teslin Village and put in the water and sewer system?

Mr. Lang: Not necessarily. First of all, I would like to ask the Minister if he has ever worked on a water or sewage project in his whole life? Have you ever worked on one?

Chair: Order, please, could you address the Minister through the Chair.

Mr. Lang: I would ask the Minister if he has ever worked on a water and sewer job, personally?

Hon. Mr. Byblow: I will answer the question bluntly: yes. I have installed water and sewer systems. I know exactly what the Member is trying to get at. He is trying to suggest that someone can go into a job, pad it, bid it up high, no one else bids, and you walk away with a profit. Yes, that happens. It can happen, but not on the jobs where we strike capital assistance agreements with bands.

Mr. Lang: Is the Minister trying to tell this House that the bands are not doing these jobs with the idea of making any profit? Are they just doing it for their health?

Hon. Mr. Byblow: I can tell the Member that I have been involved in some of the agreements that were struck under the capital assistance programs involving bands. From a corporation point of view, there is no profit built into it. From a moral point of view, there is a lot of profit. There is training provided, the people are paid wages - if you call those things profit, then sure, there is profit, but from a corporation point of view; there is no markup to the cost of the job being done.

Mr. Lang: The complaint that we have received and the observation we have received - for example, in the community of Teslin - is from contractors in that community, not from Whitehorse, not from big old, dirty old Whitehorse. The Government Leader does not mind running in one of the ridings in Whitehorse, but over the course of four years we bad-mouth Whitehorse, because it is the urban versus the rural. This happens to be a contractor in Teslin, who happens to have had some experience and has the capability of bidding a water and sewer job.

Is the Minister telling this House that it is not fair for a contractor - who pays his bills in Teslin, works in Teslin, raises his family in Teslin, has his whole life savings in the community of Teslin - to have the right to bid on, say, a $450,000 water and sewer project, which is government-sponsored through taxpayers’ dollars?

Hon. Mr. Byblow: To answer the question again, bluntly, of course it is perfectly fair for the contractor in Teslin to bid on any job in the territory. In the instance where an arrangement is struck with the band that provides employment, that provides training, that is the reality of what has taken place in that portion of the community. The municipality is required to administer a project; it is up to the municipality to make whatever arrangements it feels can be made. That is the reality of the situation.

Mr. Lang: Every Member in this House was involved in passing human rights legislation and here is the Minister standing up and saying that the contractor in Teslin should not have the same right as some other contractor in that community. That is unbelievable. Does the Minister think that that contractor is going to feel good about the comments that the Minister so bluntly made today? The Minister has just said that he is a second class citizen?

All we are asking is that those particular tenders involving public funds be publicly tendered. We are not telling you which company or organization should get it. That is done through the tendering procedure. I hope you are man enough to tell those contractors that, and look them straight in the eye ...

Chair: Order, please. Would you please address the Minister through the Chair.

Mr. Lang: Yes, I am. I hope the Minister has the courage to meet these contractors face to face, when they are out of work and have not had the opportunity of bidding on work and find you have bypassed the total tendering procedure. I hope the Minister is really proud of himself as he says to these people: pay your bills and keep your mouth shut and you can be a second class citizen. To me, that is totally unacceptable.

Hon. Mr. Byblow: I am not going to apologize for any band wanting to advance its social and economic health. I will be the first to talk to the contractor in Teslin. The Member’s comments are on the record, and so are mine. We will stand or fall on them.

Mr. Brewster: This does not need an answer. It is just an observation. It is very peculiar that the municipality has no say in this, yet the municipality will have to look after and operate the sewer line.

Hon. Mr. Byblow: I assume the Member is talking about Haines Junction. It is my understanding that an agreement is currently being developed between the municipality, the government and the band about the operation and maintenance of the entire system.

Water and Sewer Mains in the amount of $1,710,000 agreed to

Community Services in the amount of $16,139,000 agreed to

On Communications

Chair: We will proceed with page 94.

Is there any general debate?

We will proceed with line by line.

On VHF System Replacement

Hon. Mr. Byblow: As Members are aware, and I believe it has been thoroughly debated in past legislatures by the previous Minister and Members, the VHF replacement system is a fairly technologically advanced system to replace the existing outmoded VHF system.

The $3.7 million that is being budgeted for this year is a reflection of a considerable amount that was planned to be spent last year but did not get spent. In the original plans a year ago, $1.8 million was intended to be spent. In fact, only $900,000 was spent on various equipment and the beginning stages of the program.

It is intended to be put in place on a phased basis over several years. Only $900,000 was spent last year relating to equipment and the beginning stage of developing the system. So the $3,795,000 this year, while it is more than what was originally intended for the second year, is actually picking up the money that was not spent last year. As Members may also know, this year is essentially the first major year of the installation phase for the Alaska Highway corridor.

VHF System Replacement in the amount of $3,795,000 agreed to

On Community Radio and Television System

Mr. Brewster: I do not have any problem with this. I would just like to ask the Minister if he can sneak $10,000 out of it for the booster at Destruction Bay for Burwash.

Hon. Mr. Byblow: I think the Member and I discussed this. I would like to give some time to Mr. Juneau to respond and tackle it with him for a bit before making any kind of commitment like that. I will certainly accept any representations, probably in a month or two. Give me a chance to fight for a while.

Mr. Brewster: I would like to thank the Minister for that. I have also written to the CRTC and a few other of my, I should not say friends, but a few others in Ottawa. I think I have another enemy in Ottawa now. If you will take that commitment, I would be prepared to clear that right now.

Community Radio and Television System in the amount of $60,000 agreed to

Communications in the amount of $3,855,000 agreed to

Chair: Is there any debate or questions with respect to the information on pages 95-99?

Mr. Brewster: There is just one I would like to ask. I see in the Alaska Highway Agreement it used to be $12,388,000 and has now gone down to $10,100,000. Why would we, in our agreement, be allowing this to go down? We definitely need to fix more road.

Chair: I believe the Member is making reference to page 96, line item Alaska Highway Agreement - DPW.

Hon. Mr. Byblow: It is related to the applied costs. Perhaps I could take this opportunity to table some responses in Committee relating to questions Members raised previously. One of them is to do with the Alaska Highway. Also, there was a question earlier on fire hall policy.

There was a question on person years. There was a question on the Ross River arena. There was a further question on the breakdown of an expenditure item in water and sewer projects. There was a further question that the Member for Porter Creek East raised about recreation monies for recreation purposes in the communities. At the same time, he asked about total costs of projects that extended beyond a number of years. That information is just being completed and I will table it at the next opportunity.

Mr. Phillips: I almost hate to ask this question because when I do I get really evil looks from the Chair, but I am going to try it anyway. I would like to know from the Minister why, on page 95, I do not see any lines for the Old Crow Road. Was the money spent for the Old Crow Road this year? Is that it for the Old Crow Road; there will be no more?

Hon. Mr. Byblow: I believe in previous discussion I indicated that, under the item Other Roads there was $50,000 planned for expenditure this year. Is that the information he is seeking what we spent last year or intend to spend in future years?

Mr. Phillips: No, I understand that there were some estimates as high as $400,000 or $500,000 at one time to build the road. I am just wondering if the $50,000 is all that is going to be spent on the road. Is this project completed with $50,000 or is the plan to continue the road, or extend the road, and that possibly it might cost another $100,000 or $200,000? I am trying to find in the multi-year projects, if it is a multi-year project, why it is not in there.

Hon. Mr. Byblow: The $50,000 that is to be spent this year is all that is intended to be spent. What will be spent in future years is under constant review. I have to get more information on the total cost.

Mr. Phillips: There have been some requests from the Old Crow people, and the Minister mentioned that. That is why they are building the road, so they must have an idea of how much the road is going to cost. I wonder if the Minister could bring that back to the House in the form of a written answer, if he would?

Hon. Mr. Byblow: I can provide the Member with more detail as to anticipated costs and project scope.

Department of Community and Transportation Services in the amount of $49,024,000 agreed to

Department of Economic Development: Mines and Small Business

Chair: Is there any general debate?

Hon. Mr. McDonald: There are some general remarks I would like to make that will help explain the expenditures within the department.

The capital program the department proposes to deliver next year is an exciting one. It takes some critical new directions prescribed by the Yukoners themselves throughout the Yukon 2000 process. In particular, this budget anticipates the formation of two major programs: the Business Development Fund and the Community Development Fund. These programs have been designed to work in concert with existing local economic development initiatives throughout the territory.

At the outset, I would like to mention that most of the line items listed under the department’s small business branch will be rolled into the Business Development Fund. The fund represents a streamlined approach to the provision of business incentives by the government. Its scope will be larger than the sum of its parts, which means the department will be able to offer assistance to a wider range of business ventures. No longer should promising proposals fall between the cracks because they fail to satisfy the very narrow eligibility criteria of the smaller programs focusing on certain markets, industries or resources.

The Community Development Fund responds to another kind of access to capital problem. During the Yukon 2000 consultations, community residents emphasized two points. First, that the local economies of rural Yukon are distinct from large urban economies and, second, that special economic ventures were needed to spur the development of these community infrastructures and services.

Residents of the territory talked at length about the desire for greater local control or sufficiency. The Community Development Fund will further that objective as well.

Specific items in Economic Development capital budget include, in the energy and mines branch, the Prospectors Assistance Program, which provides a modest grubstake to experienced prospectors. This past summer, it helped 36 people to carry out their fieldwork, some of which yielded gratifying results. Only half of the 1988 participants’ field reports have been filed to date and, already, we can confidently say the prospectors program has assisted in the discovery of half a dozen significant gold and base metal showings. One of these properties is very close to being optioned to a major mining company.

The government is committing $140,000 to the Prospectors Assistance Program for the coming year.

The Explorations Incentive Program, valued at $936,000 for 1989-90, provides capital assistance in the more expensive stage of mineral development. It is well known among exploration companies and was this year as well as last year fully subscribed.

This summer the department contributed to the explorations programs of 39 junior mining companies. Of those funded, New Resources has optioned its Tuttle properties to Noranda and Canamax Resources has announced silver, lead and zinc reserves at Malcolm Doering. Other successes include encouraging results from exploration work at Mount Nanson and Quill Creek.

I would like to remind Members that the federal government has recently followed our example and introduced its own exploration incentives program. What preceded this initiative however was the untimely cancellation of the flow-through shares tax shelter, which had greatly benefited mineral development in the north.

We will be paying close attention to how the federal exploration program is being implemented. It is supposed to come on stream early this year and an evaluation of our program, which should be completed in the month of April, will explore whether any changes to the kind of support the Yukon government now gives exploration companies is warranted.

Turning to the energy side of Energy and Mines, in the economic strategy, the government affirmed it will act to reduce losses to the Yukon economy through expensive imported energy. The energy and mines branch is already working toward that end by promoting energy conservation and the development of indigenous resources.

The Saving Energy Action Loan Program, otherwise known as SEAL, has proven to be an effective way of encouraging and helping Yukoners to conserve energy and reduce their energy bills. This year, the program, with a fully subscribed budget, has provided low interest loans to 175 residential and commercial applicants. This is projected to translate into a total energy bill saving of close to $200,000 annually for the program participants.

Next year, with a budget of $482,000, we will be planning to assist just as many Yukoners. Further, we will be making a special effort to deliver that assistance to rural clients who as yet have not taken full advantage of SEAL assistance.

The development of local energy resources is another key way to reduce the outflow of energy dollars from the territory. The Yukon Energy Alternatives Program, or YEAP, is helping Yukoners make in-roads in the resource development area. In the current year the program has provided loans to a wood chip-fired district heating project in Haines Junction and to the development of a geothermal district heating system in Mayo. The feasibility assessment of local wood pulp production and a few micro-hydro projects may be added to the list.

Energy resource development is a highly technical and expensive area of endeavor. In keeping with its commitment to reduce the energy imports, the government is prepared to contribute to the efforts of Yukon entrepreneurs for exploring new energy developing opportunities, so we are allocating $300,000 to YEAP this coming year.

Given the important role energy conservation and development can play in making the Yukon economy more self-sufficient, we want to ensure the monies that we are contributing through our energy programs are realizing the best possible results. For that reason, the evaluations of both the SEAL and YEAP programs are to be completed, as I mentioned, this spring to determine whether any modifications to the programs are necessary.

A program now administered by the energy and mines branch is helping the Yukon government to get its own house in order. I refer to the Internal Energy Management Program. Its goal is to make the Yukon government a wise corporate energy consumer.

The Government of Yukon maintains 243 facilities within the territory, which together account for 154,000 square metres of heated floor area. Added to these are 446 residential units for social and staff housing. As energy audits carried out on a number of these buildings indicated, the cost savings accrued from improvements to government properties are significant.

The $190,200 budget devoted to the Energy Management Program in next year’s estimates will enable the energy and mines branch to continue doing energy audits  and carry out project-specific research on new technologies. Its findings will be passed on to Government Services, which will then put the most cost-effective proposals into action.

On the subject of energy development, I refer the Members to the requested expenditure authority of one dollar for the Northern Oil and Gas Program listed under the estimates for the policy, planning and research branch. NOGAP, as Members are aware, is a four year old agreement between the federal and Yukon governments to fund research related to hydro-carbon development in the Beaufort. Federal funding expired last March. In the new Northern Political and Economic Framework, released this summer, the federal government acknowledged a need to continue NOGAP. The Government of Yukon is actively pressing for this extension.

Another renewal that the policy, planning and research branch is negotiating with the federal government is the EDA. This has been the subject of discussion over the past couple of days in the Legislature. All but one subagreement under the EDA expired at the end of March. We are anxious to see them renewed. The Economic Development Agreement has provided a critical and strategic injection of funds into the Yukon economy and both governments are proud of what the seed money has allowed individual Yukoners, businesses and government bureaus to achieve.

The Mining Industry Recovery subagreement contributed $3 million to the start-up of the Curragh Resources Mine in Faro. The Economic Development Planning subagreement helped sponsor more than 40 community development planning projects and sectoral studies. In the Mineral Resources subagreement, more that 30 mapping, survey and placer research projects; through Renewable Resources and Tourism subagreements, more than 100 industry development projects each.

For the Small Business Incentive subagreement, which will be in effect until 1991, the 1989-90 estimate is $1,440,000. Seventy percent of this amount is recoverable from the federal Department of Industry, Science and Technology.

The counterpart to the new Community Development Fund is the Business Development Fund. I indicated that the overall scope of the fund will be greater than the sum of its parts. The parts in question are the following programs delivered by the Business Development Office: business loans assistance, with an estimated $2,421,000; opportunity identification, $400,000; federal capital increase, $77,000; trade show participation assistance, $36,500; applied research and technology, $100,000; renewable resources commercial development, $90,000; and, economic development organization report, $75,000.

Aside from these Government of Yukon programs, the Business Development Office assists with the administration of the Economic Development Agreement and Special ARDA.

The 1989-90 estimate for Special ARDA, which is an agreement cost-shared with the federal government to promote the economic development activities of native Yukoners, amounts to $1,045,000. This figure is subject to federal extension beyond March 31. This has not happened. Fifty percent of it will be recoverable from the federal system.

Members will note that this estimate for the Business Development Fund represents a pooling of existing monies under small business. Under its current program structure, the business development office received 210 applications for assistance in 1987-88. It approved 97 of them for a total commitment of $2,491,000. Over the first six months of the current year, it has handled 155 applications and approved 93, representing $3,506,000 in commitments. The trend here is an increase in demand for business incentive programming.

The creation of a Consolidated Business Development Fund arises from the feedback the government received during the Yukon 2000 process. Yukoners were expressing concerns about the complexities of some programs and the narrow scope of others. They also pointed out that the application process could be far simpler.

For that reason, the government has undertaken the formation of a streamlined, one-window fund: the Business Development Fund. The business development office anticipates the new fund will allow us to be more responsive to the needs of the business community, even as the economy undergoes changes from year to year. For example, banks may become more prepared to assist the private sector in a particular area of the economy because that sector has grown sufficiently strong. Assistance from the Business Development Fund could then be slowed down in that area and redirected to new, more strategic ventures.

To conclude, the Yukon economic strategy outlines a fairly ambitious agenda for the years ahead, but it is an agenda that holds a lot of promise, especially in a climate of increasing economic activity. The current economic indicators point to steady growth of the economy in 1989. A recent drop in precious metal prices has been offset by rises in base metal prices. The value of tourism and manufacturing is expected to hold, and modest increases are forecast in the construction service and renewable resource industries.

I am prepared to answer questions with respect to details of the budget. Perhaps the Members would like to discuss them.

Chair: We will now take a brief recess.


Chair: I will call Committee to order. Is there further general debate on Economic Development: Mines and Small Business?

Mr. Nordling: I am interested to see that we have another reorganization in this department, doing away with a lot of individual programming and reducing those individual programs into two huge funds, the Community Development Fund and the Business Development Fund, worth millions of dollars.

Last year, the former Minister of Economic Development talked about consolidating and streamlining programs. I called it reorganization. This was to make the department more efficient. The former Minister said to me that I was quite right, that his department has suffered endless reorganization until the period it is now in. This was last year, which was a period not of reorganization but of substantial growth in terms of its programs and activity. The Minister went on to say that what is being proposed and what is being described in my remarks is not reorganization but improved program delivery; there will not be a lot of chairs moved nor any changes to the basic organization within the department.

Now, a year later, it appears to me that we do have some reorganization and, for that reason, I would like to again express my concern about the effect of the reorganization. I would like to read in the saying that dates back to 210 B.C. It goes like this, “We trained, but it seemed that every time we were beginning to form up into teams, we would be reorganized. I was to learn later in life that we tend to meet any new situation by reorganizing and a wonderful method it can be for creating the illusion of progress while producing confusion, inefficiency and demoralization.” I hope that is not what is happening in this department. I was assured last year that it was not happening, but to consolidate the individual programs into such large chunks, I fear, will have that result.

The other thing that I would like to ask the new Minister about is the evaluation of the individual programs that are being done away with. I asked the former Minister about them, and we were not able to get copies of the evaluations that had been done because the programs were fairly new. The Minister said that after the evaluations had been completed and examined by the responsible Cabinets, they would be made public. I would like to ask the Minister if he can provide us with the evaluations of each of the individual programs that were in the budget and will be removed.

I asked for that because they are still relevant. The Minister mumbled his way through a breakdown of the dollars in the Business Development Fund mentioning several of the programs that were already existing. What my concern was in asking for evaluations last year was that we were getting value for our money and that the programs were effective. There was a concern because, in each of the two previous years, we budgeted about $12 million in capital expenditures, and about $5 million of that that lapsed, so the budgeting was not anywhere near accurate.

I see by the forecast for 1988-89 that it will be more accurate this year, but I would still like to have copies of the evaluations of those programs this year.

Hon. Mr. McDonald: I apologize to the Member if I mumbled through the listing of projects that were to be rolled into the Business Development Fund. I do not speak always with clarity and precision, but they are listed on page 122, and I am sure their names are well known to the Member himself.

With respect to the evaluations of those same programs, at this point I am not aware of the results of those specific evaluations. If such evaluations have been undertaken, though, I will undertake to provide some results to the Member with respect to those programs in terms of take-up and the success or otherwise of the individual programs.

The results from the Yukon 2000 process spoke pretty clearly with respect to the programming that the government provides. When we think about the public, we have to remember too that the public thinks about the Government of Yukon being but one government, there being two other governments and perhaps Indian bands or maybe three or more governments with whom they have to contend. So, if, within the auspices of one government, there are a variety of programs, each with narrow criteria, it is only one step in the right direction to have a single window in the Business Development Office through which you make applications for programs. But, if the programs themselves have narrow criteria, and they have their own application forms, et cetera, it makes abundant sense to streamline those funds into one that does not have such narrow criteria. That is basically what has happened.

There is no new money, as it has been pointed out. There is a streamlining of the program. I cannot pass judgment with respect to the reorganization of the department. Certainly, the previous Minister and the Member opposite have had more of a history discussing that than have I.

I am sure that if I said there will not be great reorganizations to build on old reorganizations, the Member would look at me with a jaundiced eye. I would not be so hasty as to say there would be no reorganizations of the department before I have had an opportunity to look at the department in some detail.

I take the Member’s point that it is difficult to maintain departmental morale in an atmosphere of constant reorganization. That is a valid point, and I will keep that in mind.

Within the Capital Estimates, the Business Development Fund and the Community Development Fund will be administered by Business Development Office personnel and the LEOP personnel, who have been transferred from Community and Transportation Services.

In general terms, I believe the consolidation of programming is a good idea. I believe that it makes for less bureaucracy when approaching government for programs, and that is a good thing. The problems we have had from time to time with respect to various specific programs is that they are meant to address a specific problem in the community or in the economy. Whenever government tries to fine tune the economy, because of the size of government and the role it plays, it is often a clumsy process. It is incumbent upon the government to provide for a faster and more flexible response to community desires and the desires of small business. That was repeated time and time again during the Yukon 2000 process. I think that is reflected here in the Estimates.

Mr. Nordling: I agree with the Minister that, in theory, it is a good idea to have the consolidation. That is what we started out to do four years ago with the One-Stop Business Shop, and I hope this Minister has more success than the last Minister in getting back to that one-window approach, which will be a lot more beneficial to Yukoners applying for these programs.

So there is no misunderstanding, I did accuse the Minister of mumbling. It was not through identification of the programs, it was the dollar amounts under the Business Development Fund that make up the $3.2 million. When we get to the line items, I hope the Minister will give us a complete breakdown of those dollar expenditures and, also, the complete breakdown of the dollars under the Community Development Fund, which make up the $5 million. I am sure there are areas identified.

If he does not have that with him today, I would appreciate receiving a written explanation of the $5 million under the Community Development Fund, and the $3,270,000 under the Business Development Fund. They are huge chunks of money to be under one line item, because they apply to several different areas.

Hon. Mr. McDonald: I apologize for not speaking clearly. It is something my parents have always spoken to me about and clearly with little success.

The funding that had been allocated to both the Business Development Fund and the Community Development Fund was from programs that had already been established by the government. Those programs are listed on page 119 and 122 for the Community Development Fund and the Business Development Fund respectively.

Starting with the Business Development Fund, there was the Loan Assistance Plan, the Special ARDA, Opportunity Identification, Renewable Resources Commercial Development, Venture Capital, Applied Technology, Research and Development, Territorial Participation, Business Incentives, all economic development organizations which, in total, were the programs which were to be rolled into the Business Development Fund. On page 122, there is a forecast figure for 1988-89 of $3,906,000 for all those together. The estimates for the Business Development Fund are $3,270,000. The difference between those figures, if one turns to the Community Development Fund on page 119, is that some funding was rolled into the Community Development Fund that was comprised of the programs that are listed there. They are the programs that are listed on page 119 plus the $500,000 from the programs that were listed on page 122, which make up the total for the Community Development Fund.

Mr. Phillips: At first I would just like to say that I agree with the remarks made by the Member for Porter Creek West. I am concerned about the reorganization, because I can remember many times when the Government Leader stood up in this House and publicly told us that the One-stop Business Shop would be the one-window and one-stop approach for business people. I hope that the new reorganziation, or whatever it is called, will correct some of the shortcomings of the last organization they had there.

I heard many horror stories from small businesses that were asked to provide absolutely useless data. They would go back to their accountants and they would ask why anyone would ever want to know that, yet it would have been someone from the One-stop Business Shop who would have said that they needed these economic forecasts for almost 100 years into the future. They almost needed to know their great-grandmother’s maiden name in some cases. It was beyond them why they were being asked for so much information. I hope, when they streamline the approach, they look at being more business oriented. Many times, it got to be a big bureaucracy and the people were frustrated.

When businesses come up with a new idea or concept of what they want to do, there usually is a time frame within which they have to get things done. Many business people told me that it just took too long and they gave up. They qualified, as far as I was concerned. They were bona fide Yukon businesses with very good ideas, but they had to get their businesses off the ground and it just took too long through the One-stop Business Shop. They got chased around from one person to another, which was very frustrating to them.

I helped steer several small businesses through the One-stop Business Shop by calling the people there. It helped in some cases but in other cases I became as frustrated as the business person and said, “Look, maybe you should either downsize your idea or wait another year or forget the idea because what they are asking you to do is going to take two years.” I hope when they sit down and look into the reorganization they will evaluate exactly what they are asking these business people to produce.

Many of them are like you and I, like the Minister and myself, who are just individuals who do not have a lot of background knowledge in these things and they thought that when they consulted the One-stop Business Shop, that background knowledge would be provided. Instead they were sent out to search for all these things. They have no idea where to start and they usually end up in my office or their accountant’s office, wondering where to go next.

I hope the new reorganization will solve some of those problems.

Hon. Mr. McDonald: I will begin by saying that there have been a number of cases brought to my attention as an MLA, which are mirror-perfect to the concerns that have been expressed by the Member for Riverdale North.

The effort to establish the One-Stop Business Shop, the one-window approach, was an excellent first step, but it was a first step, one step of many. Some of the things that have been happening are good second steps that have to be undertaken to provide for a streamlining of operations. A wilderness of programs, each with its own criteria, can be a daunting thing for anybody to deal with, even if they do have a one-window approach to business applications.

The point the Member makes with respect to the application form and the information that is required is valid. We feel that the response time for the business development programs we have has to be much faster. The Business Development Office and the people who administer the fund and determine the allocation of the funds - the private sector board of members of the public who make the decisions - have to understand the entrepreneurial environment of the people who are making the applications. That is something the department will be working toward improving.

The application form has to respect more the reality of the Yukon. I have heard stories of people being asked to provide very sophisticated business plans and market projections well into the future for what is really a fairly small loan. There has to be some realistic response from the program to the applicant. It has to be service oriented.

The One-Stop Business Shop concept and the streamlining of the funding are two good steps. There are other steps - the ones I mentioned with respect to applications and response time - that are critical if these programs are going to have the kind of effect the MLAs want them to have in voting this kind of funding. We have some high expectations of the support the programming provides. It is absolutely necessary that the programming live up to those expectations.

Mr. Brewster: I was not going to get into this, but I would like to back up everything that everybody has said. I continually have people come to me because they get frustrated and nobody seems to understand that some of these people come as far as 300 miles and, when they arrive, the people are not in that day. So, they do not make contact. Then, I make a phone call for them, and the first thing I am asked is about their business. I do not know their business. All I am trying to do, as an MLA, is to get them a form to fill in. They say that if we do not know his business, they should not have a form. That is not my affair, and that is not the affair of the poor guy who has come 300 miles away.

However, I would have to compliment the new Minister and the gentleman sitting beside him. When I brought that up in the Legislature in Question Period, the forms were delivered the next morning, personally. That just proves that maybe if politicians scream enough, we will get these things delivered. There was a 100 percent improvement in that case.

Mr. Phillips: I thank the Minister for his comments about some of the changes that he would like to see. I think the time frame issue is extremely important. If the department had a 30 or 60 day turnaround time, at least land applicants would have an answer one way or the other. People could then seek other sources if they are turned down.

I would like to move on to another area. Last night on BCTV, Premier Bill Vander Zalm was interviewed regarding the Alaska oil spill. In a fairly serious tone, he raised the issue of an oil pipeline. He feels that the timing is now right to explore the avenue. Rather than taking oil out through Valdez in a tanker, a pipeline might be a safer route in the future for all oil and gas coming from the Beaufort Sea. I know the Minister is going, or sending some of his officials, to the hearings in Inuvik. If the Minister is leaning in that direction, is he prepared to sit down with Premier Vander Zalm and the people from Alaska to discuss a safer way to move oil from the fragile Arctic?

Hon. Mr. McDonald: The dangers of sea transportation for oil and gas were made obvious when the tanker went aground at Valdez. I am sure there will be a resurrection of the concept of oil and gas pipelines from the Prudhoe Bay area to other markets. The incident at Valdez was incredibly tragic. The environmental impact of one stupid incident is illustration of the fact that human error can make gross and extremely deadly mistakes, which can have an impact on the environment for a long period of time.

I would agree with the Member that revitalizing the idea of a pipeline down the Alaska Highway will receive renewed interest. It is for that reason that the government is, at present, seriously discussing its position with respect to the transportation of gas and oil out of the Beaufort area. The transportation routes from Prudhoe Bay for oil and gas are all interchangeable and will all have an impact on one other.

In the north Yukon, the government is obviously very concerned about the environmental impacts of pipelines. We are also extremely concerned about the possible impact of oil and gas out of the Beaufort by ship. Clearly, there are environmental impacts for either option and this is as much as admitted by the oil and gas officials who are making application for export license right now.

The government will be assessing its position at this point and will be making a decision within the next couple of weeks, prior to the presentation in Inuvik. Our position is not with any precision defined at this point. It is not finished. When it is available, I will be making a ministerial statement for the Legislature outlining the position we will be taking in Inuvik.

The pressures that the northern jurisdictions must face from the demand of southern markets is tremendous. The values that we want to preserve are extremely important to us. Economic impacts are also a significant factor and those things are being rolled into the equation.

When I am in a position to make that statement, the Member opposite will be the first to know. I will be making the statement prior to the presentation in Inuvik.

Mr. Phillips: When the Minister makes his statement regarding the pipeline, will he also be making a clear and definitive statement on this government’s intentions with Yukon’s Beaufort? We do not have much of the Beaufort right now under the law - I guess it is still under dispute - but whether or not it is ours, the NWT government is proceeding with its development and receiving revenues from that development and doing so, it appears, quite safely and with the support of many of the native groups and the NWT government. The same thing is happening in Alaska, in Prudhoe Bay, where the Alaskans are taking advantage of the oil and gas reserves that they have.

Everyone you talk to in the oil and gas industry leads us to believe that there are oil and gas reserves above Yukon’s north coast. Those oil and gas reserves would be very beneficial to Yukoners in many ways, not only in generated revenue from the sale of oil and gas reserves but also so that we would not have to import oil and gas to the territory. I think that would be a significant saving in itself.

The government just did a study of fuel prices in the territory and I am sure in the future, this would be long range and of course with all the proper environmental impact studies and everything else, it would be possible to change the whole economic picture of the Yukon.

I am wondering if the government is prepared to announce now or in two weeks, when it comes up with its position on the pipeline, whether or not it supports Yukon Beaufort oil and gas development.

Hon. Mr. McDonald: There are economic spinoffs to be had from a pipeline, as I have alluded to in my initial comments. Should there be a pipeline, the government would attempt to secure as much economic benefit as it could on behalf of the public, in terms of an energy source or otherwise. The issue of the government’s interest in offshore development has been made clear by the Government Leader on a number of occasions and repeated by me. The government is claiming interests in the offshore. The government is aggressively expressing that position and will continue to do so, whether it be through the vehicle of NEB hearings, or whether it be in negotiations on the Northern Accord with the federal government, or whether it be in bilateral discussions we might have with the Government of the Northwest Territories. Irrespective of what they state their case to be in the NWT, the Government of Yukon has its interests and will protect them.

With respect to pipelines or tanker traffic or any transportation issue, those will be addressed in the statement I will make in the Legislature.

Mr. Brewster: When the Minister is working on this policy, I would like him to reflect back to 25 years ago when the pipeline hearings started. At that time, the pipeline experts said to put it across ground because it was much safer. If there is a break in it, the pressure immediately stops, valves automatically stop, because this is the way pipelines are run. However, people started lobbying and stopped it all and, now, we are facing one of the worst disasters that North America has ever had. We might as well face reality that the oil is going out of here and there is no way we are going to stop it. Had that pipeline been on land where it should have been, there would not have been nearly that much oil spilled. What oil would have spilled could have been sucked right out of the ground and put into your car within three or four days, with the technology they have now. I think it is time that we start to grow up and realize that we do not stop these things; we just make them go other ways, and Alaska is now paying the consequences. All we can hope is that we do not have to pay the consequences, because it is getting awfully close to us.

We are not going to stay outside of the world. We are coming into it, whether we like it or not, and our oil is going out. We are not going to stop it, so let us look at the safest route and look at the financial thing. I believe when that pipeline at that time was to go through here, we were to get $500,000 in taxes a year just off the pipeline. That did not include the tax from the workers, or the tax from the food they buy, the gas they buy. That is just off it being buried and running through our ground. We lost all that, and Valdez got it, and Valdez is paying dearly for it now.

In Haines Junction, we live with small pipelines. When they get small breaks, there is very little oil spilled. Those valves automatically shut off, the pressure pumps shut off, and there is very little oil going through. The small seepage does cause some damage, but it is a small area that is soaked up in the ground. They can get in immediately. I would hope that the government would seriously look at this option rather than possibly going out in the Beaufort Sea and going around through the icebergs and having another calamity up there.

Hon. Mr. McDonald: Certainly, I would agree with the Member that a sea disaster off the north coasts would be tremendously disastrous and probably be much more disastrous in the long term than even the Valdez disaster. I do not think anybody is overstating the case or being sensational when they say disasters or terrible terrible mistakes.

Obviously, if anybody values the wildlife at all in their value systems, they would be concerned about tanker traffic. I would tend to agree with the Member that there are very significant forces at play that the Yukon can only imagine with respect to the market forces that are demanding the export of oil and gas. Certainly, we see how difficult it is to maintain even the caribou habitat along the north coast. I think is absolutely incumbent upon us to ensure that any development that we do undertake does not have a negative impact on the wildlife. That is the challenge for us.

Mr. Phillips: No one else has any questions. I think we can move into line by line.

Chair: We will proceed with line by line.

On Administration

Hon. Mr. McDonald: This is exclusively the Community Development Fund.

On Community Development Fund

Community Development Fund in the amount of $5,091,000 agreed to

Administration in the amount of $5,091,000 agreed to

On Energy and Mines

On Energy Conservation Fund (SEAL)

Energy Conservation Fund in the amount of $600,000 agreed to

On Yukon Energy Alternatives (YEAP)

Mr. Devries: Is this the program under which someone could put in a water turbine to save fossil fuels and get a grant or something of that nature?

Hon. Mr. McDonald: This is the program that is meant to assist with the development of alternative energy sources or indigenous energy sources, which might otherwise remain undeveloped due to the absence of risk capital.

Mr. Phillips:  The Member for Watson Lake has mentioned the Yukon Energy Alternatives Program before. At one time, the people from Rancheria applied for some funding or assistance through this program. Through the same type of frustration that I talked about before, they have done it themselves, at quite a financial risk. I only ask that the government look seriously at these programs.

What actually killed the program here was all the delays and studies and data the government wanted. The fellow went to other lending sources. They took a look at the stuff he provided, and they thought it was good enough and went with it. The government should have encouraged him. It delayed him by about three years. Finally, in frustration, he gave up and went on his own.

Hon. Mr. McDonald: When the news report about Rancheria came out, I asked the department to provide a report about the proposal. I am presently reviewing that matter.

Mr. Devries: Is this also the area where the Watson Lake arena was originally going to be heated by the extra heat from the Watson Lake power plant?

Hon. Mr. McDonald: As I recall, the Department of Education was also involved with the project. Certainly, Government Services was involved along with Economic Development. I am not sure of the status of the project at this point. I remember that a study was undertaken.

Mr. Devries: This project was originally canceled due to the fact that the government felt that with the purchase of Hyland Forest Products they would be selling power to the Town of Watson Lake. It is my understanding, at the present time, that the new company is possibly no longer interested in selling power to the Town of Watson Lake. Would the department be interested in reactivating the research into this program?

Hon. Mr. McDonald: I know the Department of Education was interested in the project. The Department of Economic Development favours the idea and is prepared to pursue the idea in whatever manner is necessary to determine if there is continued interest among the various players in Watson Lake. The government is on side to see to it that this project comes to a conclusion.

Yukon Energy Alternatives (YEAP) in the amount of $450,000 agreed to

On Internal Energy Management

Internal Energy Management in the amount of $190,000 agreed to

On Exploration Incentives

Exploration Incentives in the amount of $1,000,000 agreed to

On Prospectors Assistance

Mr. Phillips: Was there some question from the prospectors about some extra funding for helicopter time? Some of them felt the government was going to expand it to include more of that, or is that included in the funding each prospector receives now?

Hon. Mr. McDonald: The short answer to the Member’s question is that I do not know. I met with the Chamber of Mines last week, and we discussed this program. It is the most popular program that we do, apart from geoscientific work, and we help do it through the EDA. The mapping is undertaken by the federal lands branch.

The Chamber of Mines indicated there were some improvements in this program that they would like to see undertaken. We agreed that we would sit down and design the program to have maximum effect for the prospectors. I do not recall extra air time, but it may well be that it is one of their highest priorities.

Mr. Phillips: I would like to commend the government for bringing this program back. The federal government ran it for years, and we have taken it over the past couple of years. It is an excellent program. Some of the major mines that are operating today were discovered under this very program. It is something we should continue in the future.

Prospectors Assistance in the amount of $150,000 agreed to

Energy and Mines in the amount of $2,390,000 agreed to

Chair: We will move on to page 121.

On Economic Policy, Planning and Research

Chair: Is there any general debate? If not, we will move to line by line.

Mr. Phillips: There is not much line by line to look through. When the Minister introduced his budget, he talked about all but one of the EDA agreements that expires. Is the Business Development Agreement the only one that has not expired?

Hon. Mr. McDonald: Yes. That is the only one that has not expired. There is a pay-out for the tourism subagreement, which is this fiscal year.

Mr. Phillips: Of any of the other agreements we have, are there any funds lapsed on them? There was $2 million lapsed in the tourism agreement. Could the Minister give us a breakdown of any lapsed funds in any other agreements?

Hon. Mr. McDonald: I will take this question as notice. I presume the Member is talking about lapsed funds over the length of the agreement. Is that correct?

Mr. Phillips: I am talking about what has happened to the Tourism Development Agreement. The agreement ends March 31, 1990, but you have to allocate all funds by March 31, 1989. The difficulty here with the Tourism Development Agreement is that we still had $2 million left when that date passed. Are there any other agreements that has happened to in the past, now or in the future?

Hon. Mr. McDonald: I do know that, over the life of the agreement for the Mineral Resources Subagreements, approximately $500,000 lapsed over the life of those two subagreements. The reason is largely that the guidelines were considered to be too narrow. That is one of the reasons why there is an attempt to negotiate for more flexibility under the program so that the guidelines of the program more closely approximate what the respective industries are looking for.

Mr. Phillips: Is there any chance of recovering the $2,000,000 from the tourism agreement? I know you have been negotiating for a two month extension, I believe, so you can use up those funds in the next two months, but is there any hope of that? What kind of indication have you had from the federal government?

Hon. Mr. McDonald: My information at this point is that $1 million of the $2,000,000 will be recoverable over the course of this coming year. But to get any more information, I will have to come back to the Member.

On Economic Development Agreement

Economic Development Agreement in the amount of $1,440,000 agreed to

On Northern Oil and Gas Action Program (NOGAP)

Northern Oil and Gas Action Program in the amount of one dollar agreed to

Economic Policy, Planning and Research in the amount of $1,440,000 agreed to

On Small Business

Chair: Is there any debate on Small Business?

Hon. Mr. McDonald: This is exclusively dedicated to the Business Development Fund.

On Business Development Fund

Mr. Phillips: I did have something I wanted to bring up there. In light of the recent free trade agreement with the United States, in talking with the people at Canada Customs and U.S. Customs, many of whom said that Yukoners and Alaskans were travelling back and forth across the borders quite frequently now and are buying goods that are duty free. I think, up until now, it has been a lot more beneficial to Yukon business people than it has been to the Alaskans. I wonder, since the government has got a line in here for trade show participation, if the government would entertain the idea of assisting Yukon businesses to attend trade shows in Juneau and Anchorage. The average consumer is the one who is going to benefit more from free trade than most. I think that there needs to be an explanation of goods and services that are going to be duty free and that we can sell to our neighbors. I think it would be advantageous for us to look at these areas and possibly sponsor a trade mission to Anchorage or Juneau that would get our foot in the door, so to speak, so that when Americans come here, they would know exactly what they could purchase for a cheaper price. It would help the Yukon economy.

Hon. Mr. McDonald: Off the top of my head, I would agree with the Member that, now that the free trade environment is here, it is essential that the government encourage the private sector to take whatever advantage of it it can. If there are trade shows that we would like Yukon businesses to participate in, and there are Yukon businesses that would like to participate, I am certain the government would support that initiative. It would be a fine idea, and I will undertake to ensure that that idea is researched further and, if there are businesses that are willing to participate in trade shows, there is some support provided by the government.

Mr. Phillips: I do not think the Alaskans will necessarily invite us to the trade shows. We have to get a schedule. Every spring, there is a major trade show like we have in Whitehorse held in Anchorage. There is one in Fairbanks, as well as in Juneau. The department should look into that for people and look at ways that Yukoners could possibly show them some of their products. I know that the side opposite did not support the Free Trade Agreement, but it should encourage Yukon businesses to take advantage of the opportunities that are out there.

Hon. Mr. McDonald: There is no appetite on either side to debate again the free trade agreement here with respect to its effects on the Yukon economy or the national economy or otherwise. There is an agreement that, no matter what the trade environment is, it is incumbent upon the Yukon to take maximum advantage of what is available. We will work with the Chambers of Commerce to see to it that some effort is made by the government to support participation in trade shows that would have positive benefit to our Yukon business.

Mr. Phillips: At the home builders show that was held in Whitehorse at the Yukon College, the contractors there who were building the R-2000 homes were deluged by the Alaskans, who were extremely interested in that concept. They felt there was a great opportunity there for them to use the expertise in demonstrating or building these R-2000 type homes in Alaska. That is one avenue right there that could provide a lot of employment opportunities for Yukoners. I am pleased to see the government is going to pursue that avenue.

Hon. Mr. McDonald: The work the Housing Corporation has done to encourage R-2000 construction has achieved notoriety, not only in Alaska but across the country, not only in home construction, but also in multi-unit construction, such as Closeleigh Manor, which has won some national awards for its design.

What we have to offer through R-2000 technology should be shared with our neighbours both to the west and to the east.

Some things that are fairly exciting and capture the interest of even people in the Northwest Territories is the superior quality of construction thatcan be achieved not only in the Yukon but also in the Northwest Territories.

Mr. Phillips: I think we can clear this item but, just for our good people in Hansard, everywhere I made the mistake of saying Yukon 2000, it should be R-2000. I was commending the R-2000 homes, and I hope the people in Hansard will see fit to correct it.

Business Development Fund in the amount pf $3,270,000 agreed to

Small Business in the amount of $3,270,000 agreed to

Chair: Are there any questions with respect to page 123 to 125, on the information pages?

Department of Economic Development: Mines and Small Business in the amount of $12,191,000 agreed to

Hon. Mr. McDonald: I move you report progress on Bill No. 51, entitled First Appropriation Act, 1989-90.

Motion agreed to

Hon. Mr. McDonald: I move that the Speaker do now resume the Chair.

Chair: It has been move by the hon. Minister of Finance that the Speaker do now resume the Chair.

Motion agreed to

Speaker resumes the Chair

Speaker: I will now call the House to order. May the House please have the report from the Chair of Committee of the Whole?

Ms. Kassi: Committee of the Whole has considered Bill No. 51, entitled First Appropriation Act, 1989-90, and directed me to report progress on same.

Speaker: You have heard the report from the Chair of Committee of the Whole. Are you agreed?

Some Hon. Members: Agreed.

Speaker: I declare the report carried. May I have your further pleasure?

Hon. Mr. McDonald: I move the House to now adjourn.

Speaker: It has been moved by the hon. Government House Leader that the House do now adjourn.

Motion agreed to

Speaker: This House now stands adjourned until 1:30 p.m. Monday next.

The House adjourned at 5:22 p.m.

The following Sessional Papers were tabled April 6, 1989:


Position Description - Fiscal Advisor: Land Claims and Devolution (McDonald)


Position Description - Manager, Financial Accounting (McDonald)

The following Legislative Returns were tabled April 6, 1989:


Recoveries - Internal Energy Management Program (McDonald)

Oral, Hansard, p. 106


Capital recoveries in Economic Development Agreement (McDonald)

Oral, Hansard, p. 107


Loan Assistance Program - recoveries and expenditures (McDonald)

Oral, Hansard, p. 107


Policy for allowance for bad debts (McDonald)

Oral, Hansard, p. 114


Two term positions in Department of Finance for Land Claims and Devolution - staffing (McDonald)

Oral, Hansard, p. 114


Two term positions in Department of Finance for Land Claims and Devolution - period of terms (McDonald)

Oral, Hansard, p. 114


Commercial river rafting - re proposed draft guidelines (Webster)

Oral, Hansard, p. 183


Tourism Supplementary Estimates 1988-89 - Beaver Creek Streetscape Program (Webster)

Oral, Hansard, p. 184


Slides, flooding and highway damage on North Alaska Highway (Byblow)

Oral, Hansard, p. 53 and 54


Policy with respect to fire protection equipment (Byblow)

Oral, Hansard, p. 95


Municipal Engineering Branch, charging person year time against specific capital projects (Byblow)

Oral, Hansard, p. 95


Problems with Ross River arena - electrical system and door size (Byblow)

Oral, Hansard, p. 150


Third Appropriation Act, 1988-89, surplus figures regarding Community and Transportation Services (Byblow)

Oral, Hansard, p. 95