Whitehorse, Yukon

Wednesday, June 1, 1994 - 1:30 p.m.

Page Number 2801

Speaker:

I will now call the House to order. We will proceed at this time with silent Prayers.

Prayers

Sixtieth anniversary, Margaret and Art Fry

Mr. Millar:

I would like to take a moment to inform the House that today is the 60th anniversary of Margie and Art Fry of Dawson City. Margie is a second generation Yukoner, having been born in Whitehorse and raised in Dawson City. There is a lot of speculation about when Art first came to the Yukon but I believe he was around the age of 16 when he started working on the riverboats.

Art and Margie are well known throughout the territory for their involvement with youth as well as their involvement in the mining community.

Art was instrumental in starting the Yukon Amateur Boxing Association, and both he and Margie worked tirelessly with the youth of Dawson to give them a social place to gather. Although they lived approximately two miles out of Dawson, they walked into town, regardless of the weather, to open the school gymnasium for the children in the old Diamond Tooth Gertie's community hall. Boxing was set up for the boys, while music, board games and skipping competitions were set up for any child who wished to participate.

Over the years Art produced many boxing champions for the Yukon, one of whom attended the Commonwealth Games. Art and Margie are still involved with the interests of the youth. If you bump into Art, he will often try to sell you a Tagish Charlie pin, the proceeds of which he donates to youth projects. They have sponsored many youth picnics and donated many ounces of gold to youth baseball and hockey teams, setting up raffles for fund raising.

Art and Margie are still involved with the mining in the Klondike area. His company, King Solomon Mines, operates on Bonanza Creek. King Solomon Mines has helped the youth, as well, by sponsoring both baseball and hockey teams. Margie and Art have worked continuously at mining, keeping their operation a family one.

Art and Margie are a wealth of historical information. Reading is a love of the couple and daily diaries are kept by both, documenting events of interest and people in their lives. It is a rare Yukon book that has not been read by this couple. Art is an honourary member of the Dawson First Nation and a honourary member of the Dawson Recreation Board.

Both Art and Margie were founding members of the CCF party, the forerunner of the present NDP. Art and Margie are loved and respected by the community of Dawson. Best wishes to them both on their 60th anniversary.

I would like to add that their daughter, Sheryl, is with us in the Chamber every day, working at the recording console for the Hansard unit.

Mr. Penikett:

We cannot let this moment pass without the Official Opposition joining in this tribute to Art and Margie Fry. As the Member for Klondike said, Art Fry - among many other attributes and proud moments - is a founding member of the CCF, but perhaps more important, he is the only Yukoner who can claim that he was not only a founding member of the CCF but also a founding member of the New Democratic Party in the Yukon. If anyone wants to get a lively political discussion or a very effectively communicated political education, you can spend time with Art Fry.

Recognition of Jarrett Deuling's professional hockey contract

Hon. Mr. Fisher:

It is my pleasure to rise today to congratulate Jarrett Deuling, for signing a professional contract with the New York Islanders of the National Hockey League. This is the second Yukon athlete to sign a professional hockey contract in the last year. Approximately one year ago, Bobby House signed a similar contract with the Chicago Black Hawks.

I would like to congratulate the Yukon Amateur Hockey Association for the excellent job that they have done in developing young athletes. This association, along with many Yukon sports governing bodies, are doing a tremendous job developing youth throughout the Yukon. It is interesting to note that both Jarrett Deuling and Bobby House have received elite athlete assistance from the Government of Yukon so that they could continue to develop and reach their goals.

In conclusion, I would simply like to acknowledge all of the coaches, managers and volunteers for the many hours of dedication and leadership that they give to supporting young athletes throughout the Yukon Territory. Congratulations again to Jarrett on the announcement of this important step in his hockey career, and best wishes for continued success.

Mr. Harding:

On behalf of the Official Opposition, I would also like to extend my congratulations to Jarrett for this achievement. I do so because I know that Jarrett is a soft-spoken person who works very hard at what he does. His achievements come through a dedication to a task, and I think he is certainly an excellent role model who shows other young Yukoners that a kid from a small place can do very big things with a little hard work, some ability and a few breaks.

Recognition of the birth of Thomas Mostyn

Mr. McDonald:

On behalf of all Members of the Legislature, I would like to congratulate Richard, or more appropriately Shona, Mostyn, on the birth of a baby boy last night at approximately 11:00 p.m. The boy's name is Thomas.

DAILY ROUTINE

Speaker:

We will proceed at this time with the Order Paper.

Introduction of Visitors.

Are there any Returns or Documents for tabling?

Hon. Mr. Phelps:

I have for tabling a legislative return.

Speaker:

Are there any Reports of Committees?

Are there any Petitions?

Are there any Bills to be introduced?

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

Are there any Notices of Motion?

Are there any Statements by Ministers?

This then brings us to Question Period.

QUESTION PERIOD

Question re: Yukon Native Teacher Education program graduates

Ms. Moorcroft:

My question is for the Minister of Education. Recently, the Yukon Native Teacher Education program, in trying to build a more positive relationship with that Minister, has made some suggestions for the ways of hiring the YNTEP graduates in view of the very few vacancies in the teaching field. They have suggested term positions, contract positions on curriculum development and cultural programming. Has the Minister

Page Number 2802

considered any of the suggestions that the YNTEP Advisory Committee has put forward on simply getting those graduates out there so that they can gain a little bit of experience in their chosen profession?

Hon. Mr. Phillips:

Yes. I received that letter a couple of days ago. I have asked the department to look into it to see whether they can be accommodated in those areas. I should point out to the Member that we have well over 400 teachers in the Yukon, and at this time, we know of only 14 teachers who will not be returning, resulting in a very low turnover in the number of teachers. We are looking at various avenues for placing YNTEP graduates if they cannot get a teaching position.

Ms. Moorcroft:

Understandably, the YNTEP graduates are concerned, particularly when there are so few vacancies. The Minister has not said anything to indicate the specific steps that the government will take to ensure that YNTEP get the jobs that he said that they would.

Hon. Mr. Phillips:

I think that I just said that very thing. The Member asked me if we are going to consider those options, and I answered that I had asked the department to consider those options. That is what we are doing; we are looking those specific options to see where there is room to employ the YNTEP graduates.

Ms. Moorcroft:

Since the Minister says that he is in support of this, has he already discussed it with the Minister responsible for the Public Service Commission, who could help facilitate such an innovative program, and has he consulted with the Yukon Teachers Association, to sit down with the YTA, YNTEP and the other Minister to discuss these very sensible solutions?

Hon. Mr. Phillips:

The Department of Education hires people for those particular positions and not necessarily the Public Service Commission. I told the Member that I received the letter - I think it was two days ago - and I asked the deputy to look at this and look into what we could do. It was a very good suggestion. I imagine there will be discussions taking place in the future, but we just received the letter. I saw the letter the day before yesterday, I believe, and discussed it with my deputy at that time.

Question re: Social services, verification officers

Ms. Commodore:

My question is for the Minister responsible for Social Services. I have a copy of a job description for the students who were hired this summer in the Department of Social Services as eligibility and benefit verification officers. The field of study is criminology and police sciences. Could the Minister explain why a student would require a background in criminology simply to verify and update data on social assistance recipients?

Hon. Mr. Phelps:

I will get the information on that.

Ms. Commodore:

This is a very important position that is being offered, and the Minister does not seem to know anything about it. In the job description, it also says that they will interview clients at their home and will interview landlords, property managers and caretakers to verify and determine circumstances. I would like to ask the Minister, when he finds out about these positions, what will they be actually hired to do - to verify data or investigate clients?

Hon. Mr. Phelps:

Certainly.

Ms. Commodore:

I am absolutely shocked. After all the statements this Minister has made in regard to social assistance recipients, he does not know a darn thing about these positions that are being offered. I would like to ask him, when he finds out about these positions, if he will let me know whether or not all of the social assistance recipients will be interviewed, or will they select only a few?

Hon. Mr. Phelps:

Certainly, I will provide that information.

I can tell her that it is based on summer employment programs elsewhere in Canada, and that it follows up with, and is consistent with, our concern to ensure that social assistance recipients are indeed eligible. I will come back with the other details and specifics.

Question re: Social services, verification officers

Ms. Commodore:

I am following up on questions I have already asked him and he seems to know a little bit about it. It appears, according to the job description, that his war on social assistance recipients continues. He has, in the past, made unprofessional statements about them in the House and also in public by degrading them at a lecture he was giving.

In the newsletter that was given to the recipients, it tells them that students will be conducting in-home interviews and that it is part of a pilot project to see how accurate their file information is. That is completely different from what it says in the job description.

Most people consider their homes very private places and a client may prefer to be investigated somewhere else. Can the Minister tell us if there are other options available for that purpose?

Hon. Mr. Phelps:

The Member opposite and I have a different view of the role of a Minister in government. She likes the detailed questions: the trees, the study of the bark and the pine needles and whatnot. Perhaps that is why she, and others like her in the large departments, really could not see the forest.

The general guidance we give the department is to carry out certain projects under certain directions. The issue of abuse of social assistance is one we are concerned about. The projects that we have brought into play here are consistent with projects in other parts of Canada and consistent with the policies in place for the department.

I am quite prepared to get details and ensure she is fully briefed on all these kinds of things, but she should not be surprised that I am not aware of each sentence in each policy and each advertisement that goes out under my departments.

Ms. Commodore:

He was not even aware of the job description in the ad that went out. The job description, when he gets around to reading it, tells a totally different story than the newsletter, when he gets around to reading that. According to the career-related merits of this position, students are told that they will gain practical experiences with fraud and other civil and criminal activities.

I would like to ask the Minister if he has no sense of decency left, and is it his policy and belief that social assistance recipients are all dishonest?

Hon. Mr. Phelps:

We have a fundamental difference of philosophy here. The philosophy of the Members opposite - at least the critic and at least one other Member on the other side - is that in the Yukon fraud and abuse of very important social programs is fine and acceptable. In this, they differ dramatically from our view and they differ dramatically from the view of their colleagues who happen to be in government in Ontario and B.C. I read into the record a week or so ago the statement that, for example in Ontario, they have hired 270 new fraud investigators full time to check out these kinds of things.

In Ontario, they have hired a batch of new fraud investigators in the Health department, as well. They have come forward with statements saying that there will be zero tolerance for fraud. So I am rather curious as to why this Member and her colleagues across the way not only differ from us with regard to our concern, but from their colleagues - their brothers and sisters - in Ontario and B.C.

Ms. Commodore:

I think the big difference between Ontario and the Yukon is that I do not think the Minister there has made

Page Number 2803

public statements of how he feels about social assistance recipients. So far the Minister has hired a fraud investigator and now has hired a number of students to investigate fraud.

Does he now feel that his fraud squad is complete, or will he continue to insult social assistance recipients by imposing further actions against them? I really want to know because they all know exactly how he feels about them and they are absolutely insulted.

Hon. Mr. Phelps:

No doubt, and I am sure that many criminals who are not on social assistance are totally insulted by the actions of the police, who dare to investigate murders, dare to investigate fraud in business, dare to investigate fraud among government workers. I am sure that the people who are investigated, brought to trial, and sometimes put in jail are terribly insulted, but unfortunately we happen to have a duty here to uphold the law and ensure that criminal activity does not take place, or at least is minimized.

Question re: Yukon Development Corporation, loan write-off

Mr. Cable:

The other night the Government Leader introduced the concept of the conversion of the $12 million loan to the Yukon Development Corporation to equity, and he just provided a set of notes to explain some of the rationale for that conversion.

In the note it says, "In some respect I can even agree with the Members opposite, in that an equity grant to a wholly owned corporation is outside the realm of surplus/deficit calculations."

Is this, in the Government Leader's view, equivalent to saying that it makes no substantive change to the government's financial position, its ability to finance its programs and its payroll?

Hon. Mr. Ostashek:

What that means is that is why we reported the $19 million surplus, because this is an extraordinary transaction on the books of the government if it is carried out. The fact remains, however, that if you have a loan on your books that you know you can never collect - for many, many reasons - it seems that all we are doing is fooling ourselves and fooling the public at large that we have $12 million more than we actually have, if one continues to consider it a receivable.

The Member opposite is fully aware that this transaction would be no different than that done by the government of the day when the original equity investment of $29.5 million was made to the company.

Mr. Cable:

That is dealt with in the briefing note. The other night, the Minister was asked when this conversion was first considered. I do not think the answer was overly clear. Could the Minister indicate to the House today when the decision was made to investigate this matter or, if a decision has now been made, when it was made?

Hon. Mr. Ostashek:

No, I said quite clearly that the decision has not been made, and that is why I was reporting to the House in that manner. We have been considering it since we came into office. It was one of those things that was on the books that I was made aware of by Finance.

Even at that time, there may have been some hope of collecting it if we had not changed the mandate of the corporation. The fact remains that those monies were put on the books as a loan. If we were carrying a large accumulated surplus, there might be some merit to keeping it on the books as an asset. However, I see no merit any longer.

Mr. Cable:

Is there any briefing paper the Minister can file in the House that relates to a recommendation to write off this loan or to convert it to equity?

Hon. Mr. Ostashek:

No. As I said, the recommendation has not been made yet. It is being considered.

Question re: Violence in the schools

Mr. Harding:

As much as I would love to pursue that cookbooking question, I would like to talk about an issue with the Minister of Education. A number of parents have expressed concern to me about the level of violence they have seen in some of our school playgrounds. I know that the schools do not condone violence; however, it still seems to remain a serious problem.

Could the Minister inform the House if there is a general comprehensive Yukon policy regarding violence in our schools? If so, could he explain a little bit about it?

Hon. Mr. Phillips:

As a Minister of Education, I am also concerned about violence in our schools. We are fortunate we do not have the types of incidents that occur in the south. I can get back to the Member on the policy. There has not been a policy developed since this government came into power. However, I will check and, if there was a policy developed by the previous government, I am sure it is being followed, and I will table it in the House.

Mr. Harding:

It seems that some of the violence is not limiting itself to the playground. Parents have told me that there is a preponderance of violent activity on the school buses as well. I have been told that there is a policy in place that entails a certain number of warnings by the bus driver with the possible eventuality of being banned from riding the school bus for a certain period of time. I would like to ask the Minister how effective this policy has been in curbing this violent activity on the school buses, and has the Minister analyzed something similar for playground situations?

Hon. Mr. Phillips:

Yes, there is a new policy in place about violent activity on school buses. My understanding is, from speaking to the Teamsters Union and some of the bus drivers, that the policy is working and seems to be working fairly well and they seem to be happy with it.

With respect to the Member's question about the policy carrying forth to the school grounds, I will pass the representation on to the department.

Mr. Harding:

We have just come through the month of May, which was sexual assault prevention month. During the past month, there was a lot of emphasis on violence against women and violence in the schools nationwide. Is the Minister open to new program emphasis in this area so that our young children in the schools can understand how some of this behaviour can affect them in the future and in the present?

Hon. Mr. Phillips:

Yes, I am, but I should tell the Member that there are several programs, and when we discuss the budget in the Women's Directorate, I can lay out for the Member the many programs that are being carried out this month and throughout the school year concerning sexual assault and violence in our schools. I will raise that discussion when we come to that portion of the debate.

Question re: Yukon Energy Corporation, privatization of

Mr. Penikett:

A few minutes ago, I was handed a copy of a letter by Councillor Duke Connelly from Mayor Peter Jenkins of the Association of Yukon Communities.

The letter says, in its opening paragraph, "Under the authority of sections 44, 45, 46 of the Public Utilities Act, the Association of Yukon Communities requests that the Yukon Utilities Board investigate and have a public review of the current actions by the Honourable Willard Phelps on behalf of YTG and his Crown corporations, Yukon Development Corporation and Yukon Energy Corporation, to either sell or diversify the current ownership structure of the Yukon Energy Corporation and its parent Yukon Development Corporation."

Page Number 2804

Could I ask the Government Leader if he received a copy of that letter? If so, can he assure the House that there will be no effort by the government to obstruct this request for an investigation?

Hon. Mr. Ostashek:

I have received a copy of the letter, but we have not yet discussed it. I do not see any reason to try to obstruct it.

Mr. Penikett:

I know, from statements made today in Question Period by the Minister of Justice, that he likes investigations, and that he will not be insulted by this one.

I wonder if the Government Leader has yet had occasion to assess and respond to the view contained in the letter from the Association of Yukon Communities; namely, "... that we believe that a diversification of the assets and/or ownership of the Yukon Energy Corporation and the Yukon Development Corporation away from YTG will not only disable this government's ability to redirect revenues from benefiting Yukoners, but will, either in the short run or long term, result in an alarming increase in electrical rates to Yukoners."

Has the Government Leader in any way responded to this letter yet, or the substance of the complaint from AYC?

Hon. Mr. Ostashek:

No, I just received the letter a couple of days ago. I have not yet had time to deal with it, or even to delve into the substance of it.

Mr. Penikett:

As the Minister knows, from a letter previously directed to him by AYC, in which they said, "We are concerned that the Minister is using his negotiations with the Council for Yukon Indians to camouflage the ultimate acquisition of the Yukon Development Corporation and the Yukon Energy Corporation assets by Yukon Electrical Company or one of its affiliates...", could I ask the Minister this: in light of this request for an investigation by the Yukon Utilities Board, has the Government Leader considered the advisability of asking the Minister responsible for energy to step aside from the portfolio for the duration of any such investigation?

Hon. Mr. Ostashek:

I do not think the Member opposite can know if an investigation will be going ahead. Certainly I have not asked the Minister to step aside at this time.

Question re: Workers' Compensation Board, health and safety regulation review

Mr. Harding:

I have a question for the Minister responsible for the Workers' Compensation Board. Last week, on May 26, the Minister, in response to a question that I asked him, said, quote, "We are looking at the budget on the Workers' Compensation Board. As soon as we have agreed on the budget, we will know the scope of the review." The Workers' Compensation Board is an independent board in excellent financial health. Could the Minister please tell my why an independent board would need the Minister's approval on a budget that the board itself should be determining?

Hon. Mr. Nordling:

This was in discussions prior to my taking over responsibility. The board and the president are perfectly willing to discuss it with the Minister - they have no problem with that. I am meeting with Ron Farrell, the president, on Friday to discuss it. It is hoped that there will be some decision then.

It is my position that the board is independent. I want as little to do with it as possible, but this issue is on my plate and I will deal with it.

Mr. Harding:

This is an independent board and this is an issue I have been asking about for months and months, and the government continues to hold it up. The Minister says he does not like it on his plate, but he continues to put it right there, front and centre.

First, the government interfered with the review and they insisted it was scaled down. Then, I got a commitment from the Minister that it would once again be expanded as it was requested in the first place. But, now, we seem to see this waffling again. Can the Minister tell me why he continues to hold up this Workers' Compensation Board occupational health and safety review?

Hon. Mr. Nordling:

I am not continuing to hold it up. I am trying to find out what it is all about, what the scope will be and how the regulations will be changed. When I have that information I am sure the review will go ahead. I expect that it will be to the satisfaction of the board.

Mr. Harding:

This is an independent board. Why would the Minister have to give his approval to an independent board to determine the scope of the review? Why? This is an independent body.

Hon. Mr. Nordling:

There was a Cabinet decision with respect to it. That decision was made prior to my coming to Cabinet. I am being asked questions about this in the House. There is some responsibility of the Minister with respect to this issue. I am working with the board and the president to settle it to the mutual satisfaction of the Cabinet and the board, and we will do that as soon as possible. The Member asking me questions is not going to speed that up.

Question re: Workers' Compensation Board nominations

Mr. Harding:

The Minister is putting this issue on his plate. He is bringing it on himself. That is the reason I am asking these questions. What he should be doing is letting the board make the determinations itself.

We have another problem with the Minister regarding the Workers' Compensation Board. That pertains to ads that have recently come out that the Minister has initiated for nominations to the Workers' Compensation Board. These nominations have been put out on a wide-open basis, which is in direct contravention of the Workers' Compensation Act, which calls for employee nominations to the board from employee groups and employer nominations from employer groups. This is to prevent people being manipulated by either group and being nominated to sit on the board. Why was this ad put out incorrectly and in violation of the law?

Hon. Mr. Nordling:

I discussed that with the independent board. The concern was that nobody who could possibly give us some input would be missed. In the past, we wrote letters to specific groups asking for nominations to the board. We were afraid that, by soliciting suggestions or names from certain groups, if we missed a group we would be accused of not being open and honest about soliciting from all employee groups and all employer groups.

Mr. Harding:

It is an absurd situation that an employer group would nominate a particular employee as the worker representative on the Workers' Compensation Board. It certainly puts the entire system out of whack, which was laid down in law and passed in this Legislative Assembly.

Does the Minister know what the law is here? Does he know what is in the act, and can he tell us?

Hon. Mr. Nordling:

I will pass on to the president and the board that what they are doing is absurd in the opinion of the Member opposite, and I am sure they will take note of it.

Mr. Harding:

This ad was put out by the Minister - the Minister who continues to stick his hand into the board - and what he is doing is entirely absurd. I want that clear for the record.

I would like to ask the Minister this: would he immediately retract this particular ad and put out another ad that complies with the law as laid out in the Workers' Compensation Act, so that these nominations can be properly obtained?

Page Number 2805

Hon. Mr. Nordling:

I will take that under advisement. I will discuss it with the Workers' Compensation Board who, I am sure, when they designed the ad thought they were acting perfectly within the law.

Question re: Workers' Compensation Board/Thomson Centre

Mr. Harding:

"The Minister is taking nominations" - that is what it says. Obviously the Minister does not understand that.

Speaker:

Order.

Mr. Harding:

Let me ask him another question regarding Workers' Compensation and the Thomson Centre.

We have heard a lot of rumours about developments at the Thomson Centre, and I would like to know from the Minister whether the terms of reference have changed regarding the agreement between the Workers' Compensation Board and the Thomson Centre's rehabilitation facility.

Hon. Mr. Nordling:

No, I do not know whether the terms of reference have changed. I know that the Workers' Compensation Board, as far as I know, is using the Thomson Centre on a payment-for-use basis. I do not know whether there were terms of reference in the past that were different from that.

Mr. Harding:

It appears to me from his answer that the Minister is somewhat unclear. Is he telling this House that he is positive there has been no change to the terms of reference or that he has not heard of any? If he is not sure, can he tell us that he is going to investigate this matter to see if there have been any changes?

Hon. Mr. Nordling:

I will investigate it. I will read Hansard from today to see if I can figure out what the Member is asking, and look into it. If I do not understand what he said, I will talk to him afterwards to find out what his problem is or what terms of reference he is referring to that he thinks have changed, so that there is something specific to investigate for him.

Mr. Harding:

In the Thomson Centre, there was a rehabilitation procedure set up so that we would not have to send injured workers down south, as they have been for awhile, so that we could get the costs down and leave people here at home. That is the point of the Thomson Centre, so I hope he understands that.

If there have been changes to that, since there have been new redesigns to the hospital and there have been changes at the extended care facility, we want to know if there is going to be a change in the relationship of payment from the Workers' Compensation Board to the government for those services.

The Minister has said that he is not aware of any. If there are changes, would he be concerned about that and would he agree to investigate it for us?

Hon. Mr. Nordling:

I am not aware that any changes have been made. I think that the Workers' Compensation Board still plans to use the Thomson Centre so that injured workers do not have to go outside. I am told that they are using it and it is on a fee-for-service basis at the present time, but that they hope to negotiate a longer-term, more formal agreement for the use of the Thomson Centre. If injured workers were being sent outside rather than using the Thomson Centre, then, yes, I would be very concerned and I would investigate it.

Question re: Yukon College, legal action against contractors

Mrs. Firth:

My question is for the Government Leader. On the noon news, we heard that the Government of the Yukon is taking eight contracting firms to court over the construction of Yukon College. The contractors who built the Arts Centre, the Yukon Archives and the gymnasium are also being sued. The government is claiming that the contractors failed to build the college according to the plans and specifications.

I would like to ask the Government Leader when this decision was made and by whom it was made.

Hon. Mr. Phillips:

Because the Department of Education was involved in that, it is appropriate that I answer the question.

The project was completed in 1988, and the deadline for launching the lawsuit was May 27, so we had to launch the lawsuit by last week. We have tried, over the last few years, to come to some resolution of the problems, but were unsuccessful in doing so. That is the reason we have now decided to launch the lawsuit - while we still had the legal right to do so.

Mrs. Firth:

Could the Minister tell us who recommended that the government do this, and why they are launching the lawsuit? What is the purpose of the lawsuit?

Hon. Mr. Phillips:

The lawsuit is because there are several deficiencies in the building we are trying to get corrected. The joint recommendation was from Government Services and Education, because it is going to cost some money to fix the problems in the building, and we feel the responsibility lies with the contractors. Because the statute of limitations ran out on May 27, we had to launch it before then, if we ever wanted to recover any of the money from the contractors. That is why we launched the lawsuit last week.

Mrs. Firth:

The government has had to retain the services of an engineering firm to determine the extent of the problems. This is going to cost Yukoners more money. Can the Minister tell us who the engineering firm is and what the cost is going to be to determine the extent of the problems?

Hon. Mr. Phillips:

I can bring the name of the engineering firm back for the Member. As to the total cost, the issue is now before the courts, and we are advised not to talk about the technical details of the lawsuit that will be discussed in the courts; however, I can certainly get the name of the engineer who was involved.

Question re: Accumulated surplus

Mr. McDonald:

Yesterday, the Minister of Community and Transportation Services will remember that we approved another $4.5 million in loan funding for the City of Whitehorse to add to its accumulated debt of approximately $8 million. The Minister will remember that he expressed the view that this debt situation was not excessive.

Can the Minister tell us why he believes an approximate $12 million accumulated debt for the City of Whitehorse - which has an annual budget of approximately $40 million - is not a problem, but an accumulated surplus of $6 million for YTG - which spends $470 million a year - is a problem?

Hon. Mr. Fisher:

I do not quite see the relevance between the two at all. I would like to point out to the Member opposite that I am sure the Member who has been the Minister of Community and Transportation Services realizes that the amount is identified in the Department of Finance budget - the $4.5 million, or whatever the exact amount was - and that it does not necessarily mean that the City of Whitehorse will be borrowing that money. It means that the money is available for the municipalities. We have to vote that money at the start of the year; if the municipalities use it, fair enough, and if they do not use the money it is returned. Each year, as the Member opposite will recall, there is somewhere in the neighbourhood of $5 million identified for possible loans to the municipalities.

Mr. McDonald:

If I might invoke the memory of our dear friend, the ex-Member for Porter Creek East, he would encourage us to understand that we are always dealing with one taxpayer, and that that taxpayer obviously has concerns about the public debt, deficit and surplus situation for any government that they may be investing in. I will ask the Minister to remember that, and to also

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remember that the accumulated debt is approximately 30 percent of one year's capital and operating budget of the City of Whitehorse.

Could I ask the Minister whether or not he has ever suggested to the City of Whitehorse that they might want to repay their debt through wage restraint directed at City of Whitehorse employees?

Hon. Mr. Fisher:

I am sure that I have not suggested to the City of Whitehorse that that would be a way to repay its debt. I think that if the City of Whitehorse went into arrears I might suggest several ways they could repay their debt. However, in answer to the Member's question, I have not suggested that they repay the debt through wage restraint.

Mr. McDonald:

I am happy to see that the Minister is not intending to inflict YTG's fiscal policies on other governments in the territory.

I would like to direct this question to the Minister of Finance, because I am sure he can help us here: can the Minister tell us whether or not he has considered writing off the municipal debt in order to draw down the operating surpluses generated by YTG?

Hon. Mr. Ostashek:

I thank the Member for his suggestion; that is one that I had not thought of at all. No, I have not, and I want to make one comment on the Member's main question to the Minister of Community and Transportation Services.

I do not think that we have to apologize at all for a $5 million or $6 million surplus. We promised Yukoners balanced budgets. We said that we would not deficit finance and we have no intention of doing that. We are not going to mortgage our future to avoid facing the tough problems that we have today. We are not just going to delay it; we are going to deal with it, and we are going to deliver balanced budgets to Yukoners.

Question re: Education, grade reorganization

Mr. Cable:

I have some questions for the Minister of Education on grade reorganization. During the Education debate about four weeks ago, the Minister indicated that he expected to make a decision on grade reorganization by the end of the school year. Is that time line still on?

Hon. Mr. Phillips:

Yes, it is.

Mr. Cable:

During the debate, I had the impression that the Minister had received from his department an analysis of what took place in the public consultations. Had the Minister actually asked for a recommendation on grade reorganization from his department, or did he simply ask for an analysis of what the public input was?

Hon. Mr. Phillips:

No. I asked for an analysis of what went on at the public hearings, and that is what the department provided for me.

Mr. Cable:

Could the Minister indicate why he has not asked his department for a recommendation, and indicate whether he intends to take the facts that are provided by the department and make the recommendation himself to his Cabinet.

Hon. Mr. Phillips:

The feelings out there are usually evident in the report of the public hearings. I think that a compilation of what was said at the various meetings that were held around the territory, and a summary of that without recommendations, is adequate to come to some conclusion. What I can tell the Member is that I have asked for some more information on numbers throughout Yukon schools, and future projections of numbers for high schools in the territory. I have not yet received those numbers, but that will all be tied in with the grade reorganization to see how it fits.

Speaker:

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

ORDERS OF THE DAY

Hon. Mr. Phillips:

I move that the Speaker do now 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 that the House resolve into Committee of the Whole.

Motion agreed to

Speaker leaves the Chair

COMMITTEE OF THE WHOLE

Speaker:

I will now call Committee of the Whole to order. Is it the wish of the Members to take a brief recess at this time?

Some Hon. Members:

Agreed.

Speaker:

We will take a brief recess.

Recess

Chair:

I will now call Committee of the Whole to order. We will be proceeding with Bill No. 15, Yukon Housing Corporation.

Bill No. 15 - Second Appropriation Act, 1994-95 - continued

Yukon Housing Corporation

Chair:

Is there any general debate?

Hon. Mr. Fisher:

Mr. Chair, you have before you the O&M estimates for the Yukon Housing Corporation. The corporation is forecasting a gross expenditure of $12,218,000. This represents a four-percent increase over the 1993-94 forecast. The corporation is also forecasting 1994-95 recoveries of $7,753,000. The four-percent increase in the gross expenditure is as a result of forced growth from the Thomson Centre, the Gateway Housing project and the 14-unit housing project in Granger. The gross expenditure generated by these projects is estimated at $1,081,000. If the impact of these three projects is removed from the 1994-95 estimates, then the gross O&M expenditure for the corporation would be less than the 1993-94 forecast by an amount equal to $590,000.

Before debating the corporation's 1994-95 estimates, I would like to take this opportunity to provide the Legislature with a status report of projects recently undertaken by the corporation.

As can be seen by the O&M estimates provided by the corporation, the board of directors and staff of the corporation have been working toward increasing the effectiveness and efficiency of the corporation. At a national level, the corporation is working cooperatively with Canada Mortgage and Housing Corporation and other provincial and territorial agencies to lessen the cost of social housing programs to the taxpayer.

At a territorial level, the corporation has also undertaken similar initiatives. The estimates being reviewed today include the transfer of dollars relating to the administration of the agreement for sale for land transactions. This was done because the corporation has the capability to effectively manage a loans portfolio. The corporation and the Department of Community and Transportation Services are cooperating in the realization of this project. The transfer is expected to be fully completed within the next few weeks.

As Members will recall, the corporation undertook a territory-wide consultation process on housing issues. The consultation was followed by a very well-attended conference. This process resulted in a number of recommendations. I am committed to having a full review of all recommendations. In fact, some of these recommendations have already been implemented.

The participants of the conference were unanimous in their

Page Number 2807

desire to have advisory boards created to discuss housing issues. Two such committees are now in existence. The first is the Territorial Association of Housing Advisory Boards. The second is a Housing Industry Advisory Group. Both these groups will work jointly with Yukon Housing Corporation board of directors to ensure that the voice of all stakeholders is heard on housing issues. The first meeting of these groups is tentatively scheduled for the end of June.

One topic that was debated with great interest during the consultation and conference is the home ownership program. Today, I am announcing that Cabinet has mandated the corporation to undertake a review of that program. The review will be conducted by the board of directors, with the assistance of the Housing Industry Advisory Group and the Territorial Association of Housing Advisory Boards. It is expected that the recommendations emanating from this process will be presented to Cabinet and implemented with the 1995-96 capital budget.

I will now be pleased to answer questions from the Members.

Ms. Commodore:

During the last session, we talked about a number of issues with regard to what was happening in the housing area. One of these was in regard to home ownership. There has been a lot of talk about where this government is going in regard to home ownership. We talked about the high vacancy rate in rental units, such as homes and apartment buildings. We also know the Real Estate Association has made some reference to the problem they would face if the government continued to build homes for people who are in need.

There is a lot of concern out there with regard to how available housing is going to be. We know there is a waiting list of over 150 people applying for social housing.

Is the Member concerned about the change in the policy of building new homes for home ownership? I do not know whether the Minister is following me or not. At one time, I understand the home ownership program provided people who met the criteria a chance to either build a new home or buy one that was already in existence. The decision was that they would no longer be building new homes, and that if someone applied for home ownership they would have to take what was available on the market. Does the Minister feel there is a problem with that decision? I know a number of people who would dearly love to build a new home if they were able to get the assistance from the home ownership program.

Hon. Mr. Fisher:

There has not been a change in policy. People who qualify under the home ownership program do have the opportunity to - and it is their choice - build or buy an existing home.

In the last paragraph of my opening speech I did say, "Today I am announcing that Cabinet has mandated the corporation to undertake a review of the program. The review will be conducted by the board of directors with the assistance of the Housing Industry Advisory Group and the Territorial Association of Housing Advisory Boards."

The Member opposite is correct. We have heard certain complaints about constructing new homes versus purchasing existing homes. I think it is important that the Member realize that the houses that were constructed this winter, as a winter-works project, were homes that were in a price range that is a fair amount below the average price of a home in Whitehorse. When we did a check of homes for sale, there were, I believe, something like four in that price range at the time we were constructing the 10 homes in the Logan subdivision.

Ms. Commodore:

I was under the impression that there were some changes. The Minister has just indicated that people can still apply and could possibly be approved for building a new home. It was my understanding that the program to build new homes under this home ownership program had been axed. Is the Minister telling me that all along it has not been?

Hon. Mr. Fisher:

That is correct. There has been no change to the program. I know that there was a newspaper article, and I think maybe that is where the Member got that information. There has been money budgeted for the home ownership program and again, that is for either a new home, an existing home, or existing trailers depending upon whether or not they meet the CSA standards.

Ms. Commodore:

I would like to ask the Minister if people applying for home ownership under this program are being encouraged to buy existing homes.

Hon. Mr. Fisher:

They are neither encouraged nor discouraged. I think there is something the Member needs to know, and that is that the Housing Corporation is essentially considered a lender of last resort. They have to prove to the corporation that they are unable to get the financing through a regular lending institution, and yet they have to meet some fairly stringent criteria that we have before they will qualify. If they want to build a new home, that is essentially their choice. If they want to buy an existing home, that is also their choice. I am going by memory - I could check it in a minute - but I think that out of something like 105 homes that were purchased, just over 30 of them were newly constructed, and the remaining 68 or whatever, were either trailers or existing houses. That goes back over a three-year period.

Ms. Commodore:

By quoting these figures, is the Minister indicating that these are homes that have been approved for people who applied for homes under the home ownership program? Is that correct?

Hon. Mr. Fisher:

Over the three-year period, approximately 105 homes were purchased or built by people who were approved by the Housing Corporation.

Ms. Commodore:

Can I ask the Minister to give me some information about applications? I understand that there have been applications turned down. I was wondering if he might give me information about how many applications he has received in the period of three years, and how many have been turned down.

Hon. Mr. Fisher:

I do not know off the top of my head. The president of the corporation is with me, and he cannot provide it off the top of his head either; however, we can probably come up with information about how many total applications there have been since the program has been in effect.

Ms. Commodore:

The Minister had indicated that he did have some concerns, because there was a high vacancy rate of homes and apartments available for rent. It seemed to be the case that we were ending up with a lot of these vacant places because of the downturn in the economy. Is the Minister still concerned about that in relation to what his programs offer? I know that concern has been voiced in the newspaper by real estate people. They said that they had a lot of houses on the market, and that the Housing Corporation should not be going into the housing business to the extent that they were. Is he, by any chance, taking their advice seriously?

Hon. Mr. Fisher:

Certainly I am taking their advice very, very seriously. I do not believe we should be affecting the market. There is a very fine line - I am not sure if I can define where that line is, but there is a very fine line - between where one is helping a young couple get into housing and where one is hurting the market.

There are concerns by some of the real estate people that we are adversely affecting market, and I take those concerns very, very seriously. That is one of the reasons I have asked for a review of this program.

As for the Housing Corporation aspect, what happens is that we sort of lag the market by about a year. Right now, there is a bit

Page Number 2808

of a downturn in the market - not a lot, by the way - and, at the same time, we have put some extra homes on the market and put people in them.

Back in the mid- or late 1980s, the market could not satisfy the demand; we were running behind the market at that time, but now we are in front of it. It is very difficult to judge whether we should be building new homes or whether we should be backing away from building them. At this time, we should possibly be backing away, but I want to hear from the various groups and get some ideas from them before we make a final decision.

Ms. Commodore:

Can I ask the Minister if the concern about the high vacancy rate in apartments and houses in Whitehorse has been relayed to him by any of his Cabinet colleagues?

Hon. Mr. Fisher:

We have discussed this in Cabinet. In fact, I brought a paper forward to Cabinet to discuss the review of the home ownership program. So, it was certainly discussed in Cabinet.

Ms. Commodore:

Did any of those Cabinet colleagues excuse themselves from those discussions?

Hon. Mr. Fisher:

One of the Ministers has excused himself from discussions because of a possible perceived conflict.

Ms. Commodore:

Did the Minister excuse himself from the room?

Hon. Mr. Fisher:

I am not sure if that is relevant or not - he was excused from the discussion. I do not believe it is relevant whether or not he was excused from the room.

Ms. Commodore:

I may pursue that further in Question Period.

During the last debate on the Housing Corporation, we talked about the perception of conflict. I was at a conference - a very good one, I might say - on housing, and the Minister indicated at that time that he was going to be continuing to use a group of people as an advisory body to advise him on things to do with the Yukon Housing Corporation. The Member for Riverdale South had indicated some kind of a perceived conflict in regard to somebody being awarded a contract and then applying for and receiving a grant to do business. The same person who is part owner of the company that got the contract also sits on the advisory board. I would like to ask the Minister if that is still the case - is that person still on the advisory board?

Hon. Mr. Fisher:

I believe I am aware of the person the Member opposite is referring to. That person was appointed to the board by the Chamber of Commerce. Yes, that person is still on the board.

The thing we should be aware of is that the advisory board does not only advise me, it also advises the board of directors of the Yukon Housing Corporation. It advises on policy suggestions, and the corporate decisions are made by the board of directors of the Yukon Housing Corporation.

Ms. Commodore:

In the end, the Minister is responsible for the corporation. That is understood. Whether or not they advise him or the board, the Minister has to make decisions and, I think, can overturn a decision by the board.

The Minister just announced that there is going to be a review of the home ownership program. He mentioned the people who will be doing the review. I think he said it will be the board. He also said the advisory board would be part of the group that does the review.

I know that the board of directors has representation from different groups in the Yukon, but I would like to register my concern about how lopsided I feel that group is. We have a wide range of people who do not seem to have a very large impact on a lot of the directions this government is going in. I might mention again that that seems to be the case with other departments, such as Health and Social Services, where individuals who live in very dire straits are not given a lot of priority by this government.

I believe, as the Minister does, that every person should be entitled to a home of some kind. If we are looking at a group such as this to do the review, where is the representation from the lower-income people who are having a very difficult time trying to find housing of their own? I would like to know what kind of representation they have on the review, because it is not balanced.

In the end, when the review is completed, they will report. We know that people who tend to live in better circumstances tend not to be considerate, in many cases, of people in a lower-income bracket. I worry about the people who really need the housing, and how that might be jeopardized by a board or committee that does not represent equally the people who would be taking advantage of the program.

Hon. Mr. Fisher:

I can certainly appreciate the Member's concerns. Again, I think the Member opposite has missed one very, very important board, which I mentioned in my opening remarks, that will be providing advice on this issue and that is the members of the Territorial Association of Housing Advisory Boards. This board consists of nine members and these people are representative of all communities. They will be providing advice directly to the board of directors and to me, as well as the board of directors, who, the Member has acknowledged, are fairly well representative of the territory. I should also say that there are six technical people on the board such as real estate people, bankers and so on. I have to disagree with the Member somewhat in that I believe we have a very good and very fair representation of all walks of life in the territory.

Ms. Commodore:

Could I ask the Minister if he could let me know how the members of this Territorial Association of Housing Advisory Boards are appointed, whom do they represent and what is their criteria?

Hon. Mr. Fisher:

The board members are appointed through Cabinet. The president was providing me with the makeup of the board.

One representative is nominated or suggested by the First Nations in a community. One representative is suggested or appointed by the municipal council and then three are appointed from the community at large.

There are nine of these boards across the territory and each board will pick one of their members to sit on the Territorial Association of Housing Advisory Boards

Ms. Commodore:

Could the Minister provide me with that information in a letter some time down the road, letting me know who all the people are on those different boards - and, in the end, which members from the different boards will be appointed as the representatives to be a part of this review? I would be interested in finding out who those individuals are. The Minister has nodded that he would provide me with that information.

I mentioned the waiting list for social housing earlier. I understand that there are just a bit over 150 people on the waiting list. I know that there are many more people out there who are not on the waiting list. They would like to be, but knowing that there is a long waiting list, choose not to apply. Their thinking is that maybe three or four years down the road, they may end up getting approval for housing. I would like to ask the Minister - since that program has been cut - how is his department meeting that need?

Hon. Mr. Fisher:

I will go back to the previous question. We do have a list of the Territorial Association of Housing Advisory Boards members. I can pass that over to the Member.

The total number of people on our waiting list currently - as of April 30 of this year - is 138 territory wide. So, it has come down somewhat -

Some Hon. Member:

(Inaudible)

Hon. Mr. Fisher:

Okay, yes. It is a month, so it definitely

Page Number 2809

fluctuates, but it has come down from what we were running approximately a year ago.

I had a meeting with Mr. David Dingwell, the federal Minister of Housing, about two months ago. We talked about that program. There is a Canada-wide housing conference, and I believe one of the Members opposite is pairing with me so that I can attend it next week. We are going to be discussing this whole question.

Our problem is that the federal government has said that any savings realized out of social housing programs could be put back into the program. Unfortunately, in the Yukon, that would amount to such a little amount - we have very little arrears. I believe a month ago, it was something like zero. We have no arrears - where can we make savings? We took the cap off rent. There is no cap now and that has ended up in some economic evictions and it has ended up in a little bit more rent in some cases, but there are no savings for the Yukon Territory. I made that point to Mr. Dingwell, and I will be making it again at this conference coming up next week.

Ms. Commodore:

The Minister did not answer my question, although he did give me some good information. I asked what his department is doing to make available more housing to accommodate people who are in need of social housing. He says we have 138 people on the waiting list. I had mentioned that there were over 150, and those are just people who have applied. There are still people out there who are in need and whose names are not on the list.

There is a considerable need. I know that many low-income people are renting accommodation - houses or apartments - and being subsidized by the government already. That is still the case with the Yukon Housing Corporation.

So, there is a great need out there. In addition to the 138 that he has indicated, there are probably a couple of hundred more. Somehow or other, that need has to be met. I know the housing personnel out there who work in the real estate business will probably not agree that the government should be doing this, but someone has to be doing it.

I would like to ask the Minister again if his department has any plans to relieve the housing situation for very low-income people who need social housing.

Hon. Mr. Fisher:

We have 518 social housing units throughout the territory right now. As the Member suggested, we have rent-supplement programs, where we rent apartments, and so on.

I agree with the Member opposite that we have a problem with there being some people on our waiting list who likely live in some sort of substandard housing, but there are also people in some of our 518 units who, with a little help, are quite capable of owning their own home. I think that one of the things we want to do is to try to encourage people to do that.

If that takes some help from government, so be it. I think we need to encourage many of these people to get into their own homes.

The other thing is that some of the homes that the 138 people mentioned earlier are living in are owned by people, but they are substandard. We have programs - and we try and encourage people to take advantage of the programs - to upgrade their homes so that they can live in relatively decent housing.

Ms. Commodore:

I do not think my question was answered. I know all of that is available, but I am still concerned about the people who are on the list. I do not know whether I would have to address this to the Minister responsible for social assistance, but what I would like to know, for my information and for the information of others, is this: how many rental units, either houses or apartments, are being subsidized by the government? The government is subsidizing private accommodation, and I would like to know whether the Minister has that information, or if I would have to ask it of the Minister responsible for Social Services.

Hon. Mr. Fisher:

I believe the Member would have to get that information from the Minister responsible for Social Services, because we do not have that type of information.

Ms. Commodore:

I understand that there is a Yukon Housing Corporation/Yukon College project that is being discussed right now, or has already been agreed upon. Can the Minister tell me about it?

Hon. Mr. Fisher:

I am not exactly sure which program the Member opposite is referring to. We have some programs that are run in cooperation with, or through, the college - the self-help program comes readily to mind. There is another one where the students of the carpentry course actually built a home for a handicapped person. The home was paid for by the person who ended up owning it - the materials, land, and so on were paid for by that person - but the students in Yukon College actually provided the labour.

There is another program whereby renovations to certain people's homes are carried out by the students in the college as a part of their course. The self-help program is our course; the other ones are Yukon College courses, and we just cooperate with them in providing the program.

Ms. Commodore:

I had understood that it was a bit more official than what the Minister indicated, and that there was a program in place with an agreement between the Yukon Housing Corporation and the Yukon College to build a starter home. However, it does not appear that is the case.

If the Minister finds there is some kind of program in place - and I do not know whether or not the president is aware of any - I would like some clarification on that situation.

Hon. Mr. Fisher:

With respect to the self-help course, there is a formal agreement with Yukon College. That is for someone who wants to build their own home and they are required to take this course prior to getting funding and before they can start on the home. That is through an agreement between the corporation and the college.

Ms. Commodore:

I was wondering if the Member could let me know if there was any move in his corporation to deal with social housing groups such as co-ops. I know that they are sometimes popular and in demand. Is there any move in the Yukon Housing Corporation to consider supporting those kinds of projects?

Hon. Mr. Fisher:

Apparently, the federal government has pulled their funding for those cooperatives. The one that comes to mind is Habitat in Winnipeg, I believe. There is not much that we can do, but if there are cooperatives started, we would certainly be interested in providing technical assistance and that sort of thing to them. With the federal government not providing the lion's share of the funding, there is no way that we could get into that type of a program.

Ms. Commodore:

How about the $20 million surplus?

I think that we have to ask the Liberal MLA to urge his federal colleagues to provide some kind of financial assistance for this, but that is only a suggestion.

Does the Yukon Housing Corporation have a native housing coordinator?

Hon. Mr. Fisher:

No, we do not. The main reason for that is because the First Nations look after their own social housing and housing on band lands.

Ms. Commodore:

Can I ask the Minister if he has had any recent discussions with First Nations people about the housing that is provided by them and by the Yukon Housing Corporation?

Hon. Mr. Fisher:

Some time ago, I believe it was just before

Page Number 2810

Christmas or in November, we received a resolution from the chiefs stating that they did not want Yukon Housing involved in their housing programs. In fact, they were asking the federal government to fund housing directly, through the CYI.

We have honoured that request. Since then, there has been a housing committee struck. I am not sure exactly what the legal structure of it is, but there has been a group assembled and we have started preliminary meetings with the group. A meeting was held about two weeks ago between the group and the Housing Corporation, so we certainly will meet with them at their request.

Mr. Harding:

I have some questions for the Minister on the continuing drama of what is happening in Faro with Faro Real Estate. When we last tuned in to this story, we had just gone through the restructuring of the loan the Yukon government had made to Faro Real Estate, which I believe stands somewhere in the vicinity of $1.4 million at this time, and has stood at that level for some time because no payments have been made for roughly a year - I believe the government said that. I asked about this in Question Period last week and the Minister told me that there was another grace period for restructuring the loan extended to Faro Real Estate, but there was very little in the way of detail as to the extent of the extension the Minister referred to.

Can the Minister explain exactly where that situation stands? How long is the extension? What terms of reference for the extension are we looking at, and what does he think the chances are that this is going to get resolved in the near future?

Hon. Mr. Fisher:

I would like to clarify a few items the Member has stated. I do not believe that we said a restructuring had taken place. I believe we said that there was a request for restructuring.

The other thing is that the balance owing on that mortgage is approximately $1.8 million, not $1.4 million. The arrears go back to approximately December of 1992 - it is closer to a year and a half. It is in arrears right now by something close to $450,000. The final point is that Faro Real Estate has given the Yukon Housing Corporation notice that it wants to cancel the current agreement on the restructuring. In fact, it was cancelled Friday.

Mr. Harding:

What does this mean for my constituents who are tenants of Faro Real Estate? I have been telling them for some time, based on the information from the Minister, that Faro Real Estate was in arrears, that there was some restructuring, or an attempt by Faro Real Estate to restructure the loan and start making some payments. I had sent them Hansard, showing where the Minister told my constituents through me that the Yukon Housing Corporation had considered foreclosure, which I guess people are not too worried about because they feel that the Minister has given them assurances that if Faro Real Estate were foreclosed upon, the government would take over and continue on the same landlord-tenant relationship.

Nevertheless, there is a bit of anxiety as a result of the feeling that a lot of my constituents have about the direction this government has taken in regard to the permanency of the citizens remaining in Faro and remaining as a community.

In a nutshell, I guess, my simple question to the Minister is this: what does this mean for my constituents if the restructuring agreement is now going to end?

Hon. Mr. Fisher:

I cannot see any changes in the short term, regardless of whether or not we were to foreclose; our legal people have been in the position to foreclose at any time. But, if we did foreclose, I cannot see that changing anything now in existance for the people in Faro. We will do whatever is best for Faro.

Mr. Harding:

This is a somewhat difficult issue to nail down. I know that Faro Real Estate is receiving the rental monies. They receive mine - $550 every month for my house - so I know they are receiving some money. They are receiving money for rental payments from others in the community. There are still quite a few people living in the community. I am not sure how many of the units are full - quite a few have been closed up, but there are still a heck of a lot. Up in the neighbourhood I live in, all the major housing units are virtually full. Even on the outside of the lower bench, they are quite full. Some of the areas in the middle area are also still quite full.

There is probably a considerable amount of rental revenue coming in, and my understanding is that Faro Real Estate is managing this rental revenue. What is happening with this? I want the Minister to be sure he is sure when he responds.

Hon. Mr. Fisher:

The houses we have a mortgage against, whether we are in first or second place - for some, CMHC is in first place - come under the agreement that Faro Real Estate has just recently cancelled. The agreement we had in place is such that the Yukon Housing Corporation has access to the bank account where all the monies from the rentals is put. The payments are then approved by the corporation.

With the cancellation of that agreement, we will no longer have control over those bank accounts.

The Member said it appeared to him that many of the houses out there were full. Our understanding is that, of the houses we, or someone else, have control over - whether it is first or second place, as a lender - the vacancy rate is something like 80 percent.

To fully analyze that, determine what it actually means, and what it will mean to the people who are living in rental housing in Faro, is something I have not done.

Mr. Harding:

That seems high. I could definitely be wrong, but we have first or second place on about 330 or so units in Faro. It is my understanding that we have about 450 - actually I think it is more like 410, and 500 or so units if you count apartments and everything else. I find that 80 percent seems quite high. Here is my concern. We have people in Faro paying money in, and Faro Real Estate is collecting it. Now, this agreement with Faro Real Estate is done, and Faro Real Estate is getting this money. They are, in effect, managing property that belongs, at least in part, to the Yukon government through a lien. There has been no contract let. There are people in Faro who could probably bid on a contract to manage the Yukon government's property. The government is, without any contribution or pay-back to the taxpayers of the Yukon, now in the position of a landlord, without any contract being let. Also, along with the uncertainty created by the recent cancellation of this relationship, people are going to want some form of a definitive statement from Yukon Housing and the Minister as to how we are going to approach this. I am not trying to push any panic buttons here, but I think that the information about how this is going to be approached should be clearer. Can the Minister tell me some more about how he feels we could accomplish this?

Hon. Mr. Fisher:

It appears that the Member opposite is implying, at least, that we should enter into foreclosure proceedings. I would like to ask the Member opposite if that is really what he is suggesting to me.

Mr. Harding:

No, I am definitely not saying that the government has to enter into foreclosure proceedings. I was questioning the Minister under the assumption that we were indeed giving an extension for a period of restructuring of the loan to Faro Real Estate by YTG. What I am getting at is new information. I am not suggesting that the Yukon Housing Corporation should foreclose on Faro Real Estate at this point. What I want to know is this: what information is clear? I have to tell my constituents something about what is happening with Faro Real Estate. They do not see any difference, because the same people are collecting their rent; they are paying it on a monthly basis, and they are still living in the same units. I think they would also be surprised by this

Page Number 2811

80-percent figure. I think they have to be told clearly what the situation is. I do have a concern, though, that a person or a company would be in debt to the Yukon government, and be cancelling an agreement that then gave the Yukon government some control over the rent my constituents are paying, and still would be allowed to continue on in a relationship such as we are not used to in Faro, without any procedure of the Yukon government to establish rental collection for the units they are renting.

Does the Minister understand where I am coming from with my concerns?

Hon. Mr. Fisher:

Again, the points may very well be moot. Regardless of what we do, it should not affect the people renting the houses.

To make myself very clear, in December of 1993, Yukon Housing Corporation began foreclosure proceedings on Faro Real Estate, based on the fact that they had not made a payment for approximately 11 months at that time.

Very early in January there was a restructuring agreement struck with Faro Real Estate, and that is where we gained control, more or less, of their bank account. The restructuring agreement was cancelled this past Friday and we are right back where we were in December of 1993.

Mr. Harding:

In terms of what my constituents see as money still going out on a monthly basis, with no action taken against Faro Real Estate in terms of tenancy relationships, in that sense I guess you could consider it to be a moot point. However, as the MLA, I am concerned about what is underlying the situation. I think some of them are, too, because they are making plans.

For example, would the Minister not be concerned that we now have someone managing the units in Faro that the government has an interest in that basically has not been contracted and has not faced a challenge from somebody else in Faro who may be interested in managing the units in Faro? Is there no concern there?

Hon. Mr. Fisher:

Until some legal process has been gone through, we cannot control the management of the houses in Faro. They are still in Faro Real Estate's name and title and they have management control of their own properties, so we cannot do anything about that. However, the loan has been outstanding for nearly a year and one-half, and this has to come to some sort of an end. There is no question about that. If and when it comes to a closure, and we, hypothetically, end up with the houses, then whatever management agreement is in place now would certainly be changed.

Mr. Harding:

I understand the Minister's answer about the legal proceedings. We have an interest but we have to go through a procedure if we are going to realize what that interest in the houses is, and that would be sorted out in the courts.

Another problem with the situation is that we basically have very little control now over the situation. This new agreement was, as of last Friday, determined to be null and void by Faro Real Estate - to mean nothing - so we are back to the December 1993 arrangement, which does raise some questions. For example, three of my constituents, and probably more, have come to me and are trying to work with Faro Real Estate, with the interim receiver and with the territorial government to get liens removed so that they can buy houses. The interim receiver in this triangle has told them that they are having trouble with Faro Real Estate. Faro Real Estate has told my constituents that they are having trouble with the interim receiver.

This is the web we find ourselves in, which is why I asked the Minister first to make sure that the government is clear about its liens. They did that, but I feel somewhat powerless to help my constituents to deal with Faro Real Estate and Peat Marwick Thorne. Given the financial interest we hold in Faro Real Estate and the number of units there, given our loan, we should have some significant clout. But to me it appears that we are now at a point where we are not in control of the situation.

The Minister is basically saying that the only way we could gain control is to initiate some form of legal proceeding, and try to realize the interest we do have in the units. Is that correct, or does the Minister feel we have some ability, at this point, to work with Faro Real Estate, or to extract some cooperation from Faro Real Estate, without going through a legal proceeding?

Hon. Mr. Fisher:

The Member opposite is right. Going between Faro Real Estate and Peat Marwick, CMHC and the Yukon Housing Corporation does get very complicated.

Our understanding is that, essentially, the receiver has a mortgage on those properties, through Curragh. Our understanding is that Faro Real Estate would be interested in selling the units and providing title, as would we, but it is our understanding that it is the receiver who is causing the problem.

In this particular case, I would have to agree with the advice that it is the receiver who is causing the problems for those people.

Mr. Harding:

I think the assumption the Minister is making - the knowledgeable assumption, because he has looked into it - is correct. I do not necessarily think it is Faro Real Estate that is doing it, but it is interesting that when one of my constituents approached one of the interim receivership representatives, a Mr. Gordzinsky, who was on the property in Faro - about the house that they want to purchase in Faro, he blamed it on Faro Real Estate. I would ask the Minister to try to work diligently to try to sort that out.

I do not know if there is any real serious legal requirement that is preventing it because of the receivership - maybe there is. The president is nodding his head that there is. Then we do have a problem.

I would like to get some sort of a definitive response. I did get a response back from the Yukon Housing Corporation, but I would like to be able to tell my constituents more clearly what the legal requirement is under the Bankruptcy Act, and why, until the property is completely sold, my constituents could not get title, because they really want to buy these houses.

What about this as a proposal? About 20 percent of the houses that we have an interest in are occupied. It is interesting because the government has already written off the loan that was given to Faro Real Estate, and that shows up in the books for the supplementary estimates. The Department of Finance has written off the loan; rental monies are still being paid in by my constituents, but are not going to the government. Last week, when I asked the Minister if he still expected to receive the loan, he said he did still expect to recoup the money.

I know that if one takes the number of units that we have an interest in and one looks at what the outstanding loan is - if it is $1.4 million and one takes the 336 units, it is around $4,200 to $4,300 each.

Some Hon. Member:

(Inaudible)

Mr. Harding:

The Minister says it is now about $1.8 million, so I guess it would probably go up to $5,000 to $6,000. I know there are probably a lot of my constituents who would be interested in purchasing a unit in Faro for that price. That would be all they have to be sold for to recover some of the funding that the government has already written off.

Has the Minister considered this idea and is he prepared to take a look? I do not think, by any means, that the Minister wants to sell off 336 units, nor could he, but is there any way for my constituents who are interested to acquire some of the units, so they could actually own their own homes? Why would we leave them in Faro Real Estate's hands when people in the community could own them and the government could get some money back?

Hon. Mr. Fisher:

The Member opposite has to realize that

Page Number 2812

the units are still owned by Faro Real Estate. We could not sell them any more than we could sell the Member opposite's new pickup. The only way to do this would be through foreclosure proceedings, and if we were successful and became the property owners in Faro. In that situation we could do something with the units.

Mr. Harding:

Is the Minister considering that?

Hon. Mr. Fisher:

The Member has to realize that the Yukon Housing Corporation is essentially run by a board of directors. I have to listen to the advice of the board of directors before a decision is made.

Mr. Harding:

I do not want to start a big panic in Yukon Housing Corporation or with Faro Real Estate. I am not advocating that we go in and foreclose on Faro Real Estate, but I do want my constituents to be taken care of and I do not really want them paying rent to Faro Real Estate if there is no benefit coming back on the loan that taxpayers made to Faro Real Estate.

I know that in the case of many of my constituents, if they could purchase a house or a unit for a decent price in Faro, they would probably try to do so. Many may not be able to purchase property, because they have not been working, but there are some who would scrape together whatever they could to go to work and do that at this point.

I am kind of betwixt and between; maybe it is because I do not have all of the information as to which direction to go. The Minister has just told me that he is going to get some advice from his board of directors, so I will stay tuned on this issue and keep coming back to it.

I do have a problem with a company that makes its money by receiving rent from constituents, but owes money to the Government of Yukon, and the government is receiving no money back on the loan that they gave in the first place on taxpayers' - which includes my constituents - behalf.

I would like to see an opportunity for - and apparently, it can only be done through legal proceedings - my constituents to purchase, if indeed they did wish to do so. Many may wish to rent, but there are some who could come up with the money to purchase a property.

The Minister has stated that he is going to seek advice from the board of directors. Does he have any final comments about time lines and when we might expect to receive some more answers about this particular issue?

Hon. Mr. Fisher:

We are exploring many options, there is no question about it. Foreclosure is certainly one of them - no question about that - but, as the Member I am sure is becoming aware, it is a very, very complicated situation: the ownership of all of these houses, the number of mortgages and the number of people who are involved in the financing. We are exploring options and I will keep the Member opposite informed because of his interest.

On Activities

On Administration

Ms. Commodore:

I would like the Minister to tell us a little bit about where that money is going.

Hon. Mr. Fisher:

I will just run through it quickly: meetings and honoraria, $50,000; public relations, $26,000; policy and planning, $35,000; professional recruitment and training, $30,000; travel and transportation, $96,000; communications, $80,000; rent, office and equipment, $174,000; computer services, $90,000; professional fees, $70,000; office and sundry, $48,000; and conferences, $32,000; for a total of $731,000. With personnel of $2,659,000, the total is $3,390,000.

Administration in the amount of $3,390,000 agreed to

On Program Costs

Hon. Mr. Fisher:

This is housing operations: utilities, $824,000; property taxes, $507,000; rental facilities, $514,000; housing operation overhead and administration, $349,000; private non-profit subsidies, $1,054; general maintenance, $1,306,000; grounds and snow removal, $120,000; for a total of $4,674,000; interest on long-term debt, $3,160,000; depreciation, $994,000; for a total of $8,828,000.

Ms. Commodore:

I have a question about the review this corporation has undertaken. When does the Minister expect it to be completed? How much does he expect it to cost?

Hon. Mr. Fisher:

The cost will be minimal. It will be a matter of bringing the people in to a weekend meeting - or at some convenient time. We will have to pay the expenses. I would like to have the review done before the next budget cycle, so we know what we are looking for in the next fiscal year.

Ms. Commodore:

The review is going to be more than just coming in to a meeting. What other actions is the Minister taking within that review?

Hon. Mr. Fisher:

We have not fully decided the details of the review. We have just decided there is going to be one. We are not sure how it is going to be carried out. There will probably be more than just one meeting. The other thing we have to take into consideration is the information and recommendations that were given to us at that conference.

Ms. Commodore:

When they decide how that review is going to take place, could he let me know? I would not mind being kept up to date on it.

Hon. Mr. Fisher:

Certainly.

Mr. Cable:

Can the Minister explain the depreciation item he referred to a moment ago?

Hon. Mr. Fisher:

That is on any of the assets the government paid for. Because it is a Crown corporation, it is somewhat different from government, and they have to take depreciation into consideration as an annual expense.

Mr. Cable:

How does that come out of program costs? There is no cash involved in depreciation.

Hon. Mr. Fisher:

The Yukon government provides a grant to the Yukon Housing Corporation, which is, in fact, the net operating loss for the year.

Mr. Cable:

I am not sure what the Minister said. How does the depreciation in the corporation convert into a cash requirement from the government?

Hon. Mr. Fisher:

It is not actually a cash requirement. The shortfall from what the corporation spends and receives - and depreciation has to be taken into those calculations - is what the Yukon government funds.

Mr. Cable:

Is the shortfall on the income statement? Is that what we are talking about?

Hon. Mr. Fisher:

Yes.

Program Costs in the amount of $8,828,000 agreed to

Operation and Maintenance in the amount of $12,218,000 agreed to

Yukon Housing Corporation agreed to

Public Service Commission

Chair:

Is there any general debate on the Public Service Commission?

Hon. Mr. Nordling:

From the 1993-94 forecast, the Public Service Commission budget is down one percent. Essentially, there is not much change to report since last year. There will be a new organizational structure that is not reflected in this budget, but which will be reflected in the first supplementary in order to improve the service delivery. That organizational structure will not change any of the funds needed for the programs outlined in this budget.

Ms. Moorcroft:

That was a pretty brief introductory statement

Page Number 2813

from the Minister. We are kind of spinning over here with what has been happening with contract negotiations, for instance, and with the whole approach to labour relations taken since the change to a majority government.

The Public Service Commission provides corporate personnel services to the Yukon government in partnership with employees, among others, and also with departments in the Yukon community. How does the Minister think that that partnership with employees is presently functioning?

Hon. Mr. Nordling:

We think that it is functioning fairly well. We expect to continue working on that on an ongoing basis. I know that the Member is referring to the effect the public sector wage restraint legislation will have. We will certainly be working with the employees to maintain morale and maintain the relations that we have had in the past and that we hope to have in the future.

Ms. Moorcroft:

They may hope to have positive relations in the future, but I do not believe they have them now.

The first area of questions that I wanted to address to the Minister were on the reorganization he referred to briefly in his introductory remarks. He has said that that reorganization will not affect the budget in any way; however, there are nine branches listed in the current budget, and when I look at the organization of the Public Service Commission in the new phone directory, put out effective April 1, 1994, there are eight branches and many of them have different titles, so, I would like the Minister to explain the reason for this reorganization and how things are going to change.

Hon. Mr. Nordling:

The idea was to be more pro-active and informed in delivering our services. There was a strategic plan developed, and the new organization was to take that into account. The idea is that there be more integrated one-stop shop service to the departments, to employees and to job candidates. If the Member wants, I will briefly go through how this integration of services was achieved. If she wants more information, I can provide that to her.

What we have done is combine the staffing, employment equity program, services, and classification functions into a new corporate human resource services branch. We have combined labour relations and compensation functions into a staff relations branch. We have combined benefits management, employee records and pension functions into a benefits management branch, and we have created a planning and research branch that will provide research to support human resource planning and policy development, communication services, and will coordinate and manage the employment equity planning process. The staff development branch will continue to provide development and training functions to support the human resource management. Finance and administration will continue to provide financial and personnel management for the commission.

Ms. Moorcroft:

Would the Minister provide us with a copy of the strategic plan that was used to implement that reorganization?

Hon. Mr. Nordling:

Yes, I will provide a copy of that for the Member.

Ms. Moorcroft:

I would appreciate getting a copy of that as soon as I could.

The Minister indicated that the staffing employment equity services and classification were going to be together in this new corporate human resource services branch. He then indicated that coordinating the employment equity would be in the research and planning branch. Are they going to have two different branches working on the same function?

Hon. Mr. Nordling:

One is long range, and the other is the program services.

Ms. Moorcroft:

Earlier this year, we had a legislative return from the then-Minister of Government Services about government-wide application of personnel management systems, saying there were substantial economies to be realized by a one-government system and by using common systems throughout government. The Minister has also just referred to that.

Are they using a common system throughout government in personnel practices?

Hon. Mr. Nordling:

No, I am informed, not at this time. I believe it has been put on hold.

Ms. Moorcroft:

The objective of the Public Service Commission, as indicated in the budget book, is to provide corporate personnel services to the government. Can the Minister explain that answer a little more?

What personnel services are offered throughout departments and what personnel services are offered through the Public Service Commission?

Hon. Mr. Nordling:

We still provide the corporate personnel services. What was being looked at - and will still be looked at - was to provide a standardized and computerized system throughout the government.

Ms. Moorcroft:

Is there a common system in use throughout government that is not computerized at the present time?

Hon. Mr. Nordling:

No, the common system is what has to be done under the Public Service Staff Relations Act and the collective agreements. Right now, those provide the continuity between departments.

Ms. Moorcroft:

Since the Minister has raised that issue again, what does he see as the role of unions in the workplace?

Hon. Mr. Nordling:

I see the role of unions as representing the employees.

Ms. Moorcroft:

Well, at least he can say he sees that, but we have not seen much evidence of his actually demonstrating an understanding of that. How would the Minister define collective bargaining?

Hon. Mr. Nordling:

I think that we have been through this before. Collective bargaining is the union making representations on behalf of their members to the employer, to determine the wages and working conditions that are mutually agreeable to both parties.

Ms. Moorcroft:

Why does the Minister then think that there is no responsibility on the part of the government to engage in that process?

Hon. Mr. Nordling:

There is a responsibility on governments to engage in that process, but it is not absolute.

Ms. Moorcroft:

We will save that particular debate for the Public Sector Compensation Restraint Act, 1994, although I am not sure how relieved the Minister will be to hear that.

Does the Minister have a summary of the lapses for the Public Service Commission that he could provide for me to have a look at?

Hon. Mr. Nordling:

Yes, I do have a summary of the lapses and an overview before me here, and I can provide that to the Member.

Ms. Moorcroft:

Perhaps the Minister could provide some of this information to me at the break, because it is hard to ask questions without having the required information.

Earlier, I requested other information with regard to the record of grievances within the government. I did receive a summary of the number of grievances for the last five years, including the number for 1993. I had requested a breakdown of those grievances, as to what their nature was, and how many went to the final level. Is that information available yet?

Hon. Mr. Nordling:

My understanding is that the department did it up as a legislative return. I will have to check to see where it is and get it for the Member.

Page Number 2814

Ms. Moorcroft:

I do not recall seeing that particular return when I went through my pile of Public Service Commission legislative returns. If I have overlooked it, I would appreciate the Minister providing me with another copy.

The Minister had also provided, in the past, a record of the number of positions that were terminated up until November 1993, I believe. I would like to ask if they know how many further positions have been terminated since that time?

Hon. Mr. Nordling:

Yes, in fact, a draft of that response is on my desk for the Member. I am sorry I did not get it to her earlier. I must admit that doing the Public Service Commission budget today was a bit of a surprise; I had not thought we would get to it so soon. I can tell the Member that between November 23, 1993, and, I think, May 20, 1994, there were 221 positions termed.

Ms. Moorcroft:

I note that the term that they use is "termed", which does not necessarily indicate "terminated", so all of the positions in this chart that I went through are terminated. I would like to ask whether they are terminating positions at one level - for example, there are a number of heavy equipment operators and maintenance positions here - then substituting a lower level position and filling it to do the same work. Is that happening?

Hon. Mr. Nordling:

Not that we are aware of. The Member is right with respect to the positions termed. My understanding is that means that they are terminated right from the books, in that sense. There are replacement positions created but, to my knowledge there has not been a downgrading of positions.

Ms. Moorcroft:

We have asked some questions regarding privatization and contracting out. I would like to ask the Minister what is happening just now with regard to the initiative that did not really get off the ground to contract out the custodial work in the Education building. Could the Minister tell me the current status of that?

Hon. Mr. Nordling:

Nothing has happened since I last reported to the Member about that. The initiative is on hold. We still have the janitorial staff at both the Education building and at this main administration building.

Ms. Moorcroft:

What were the reasons for considering privatizing it, or contracting it out, in the first place?

Hon. Mr. Nordling:

The reason was because there were complaints that this building, in particular, was not being adequately serviced by janitorial staff. The question was whether we should simply add staff, or move staff from the Education building to here, so we would have a full complement in this building, and it would be kept to the standard that it should be, as a main government administration building.

Ms. Moorcroft:

If they need more positions in one building, I do not see that as a reason to get rid of the staff in another building. What was their reason for putting it on hold?

Hon. Mr. Nordling:

It was simply to decide whether or not that was the wisest use of human resources, and to make sure that, if we did move the janitorial staff from the Education building to this building, we would not be over staffed here. We did not want there to be any layoffs or reduction in custodial staff and hours as a result of the consolidation here.

Ms. Moorcroft:

There may not be any layoffs or reductions in hours if they consolidate staff and move them over to this main administration building; however, if they contract out, they are going to be eliminating positions. Are they still seriously considering that?

Hon. Mr. Nordling:

No, positions in existence now would not be eliminated. What we would be doing is hiring janitorial staff to clean the Education building. The decision to be made, that has not been made, is how we should do that. It has not been decided if we should hire new government employees or whether we should tender that and have the private sector janitorial companies cleaning that building.

Ms. Moorcroft:

That statement is in direct contradiction to a number of statements that have been made by the Government Leader and other Ministers responsible for the Public Service Commission, that they were not contemplating contracting out for custodial work. The Minister is aware of our representations that we are not in support of that, so I do hope they are going to seriously think about the consequences before they undertake an action of that sort.

I am looking at the comparison between full-time equivalents and position years. This was prepared in November of 1993.

I would like to ask for an update on the comparison of employees and full-time equivalents. I would also like to know if there are more part-time workers now in the government?

Hon. Mr. Nordling:

We will have to provide the Member with an update on that topic.

Ms. Moorcroft:

So the Minister does not know if there are more part-time workers now.

Hon. Mr. Nordling:

No, not at this point, but I will check on that for the Member.

Ms. Moorcroft:

When will part-time workers be able to buy back their service in order to contribute to the superannuation plan and have pensionable earnings?

Hon. Mr. Nordling:

We are still under the federal Public Service Superannuation Act, so we are subject to those provisions. It is dependent on them. What we would like to do is to patriate our superannuation plan, and there is some money in the budget for that. In fact, the largest increase in the compensation line is for looking into doing that, but for now we are subject to the federal government act.

Ms. Moorcroft:

I believe the federal superannuation act has been changed for some time to allow part-time workers to contribute to the superannuation plan. However, the regulations necessary to bring that into effect have not yet been put in place. In the meantime, part-time workers really suffer by not being able to contribute to pension funds.

I would like to ask the Minister to correspond with the federal Minister and urge them to enact this so that part-time workers who are presently in the workforce who may be thinking of retiring will be able to take advantage of this - that it will not be something that continues on for years without resolution.

Would the Minister do that?

Hon. Mr. Nordling:

Yes, I agree with the Member's concerns and I will correspond with the federal Minister and send a copy to the Member.

Ms. Moorcroft:

I would also put on the record that I would support the initiative to patriate the superannuation plan and I hope that can be successful. It did happen with the Yukon College when they were devolved from the Department of Education to a separate entity, and I believe it has been relatively successful, so I hope there is some success bringing the superannuation plan to the Yukon.

Hon. Mr. Nordling:

The Member is correct, and I agree with her and thank her for her support.

Chair:

At this time we will take a brief recess.

Recess

Chair:

I will now call Committee of the Whole to order.

Is there further general debate on the Public Service Commission?

Ms. Moorcroft:

I have to come back from the break and say that I really was quite disconcerted when the Minister agreed with me so readily before the break. I must say I hope it is going to be that easy to get him on side with dropping this completely unnecessary

Page Number 2815

and highly unpopular Public Sector Compensation Wage Restraint Act, 1994. He is shaking his head no. Well, we will get there.

The Minister thinks that everything is rosy - from what we have canvassed in the first portion of the debate - but the employees do not. I am going to refer to some of the results in the Yukon government employee survey that was produced in April of this year and pose some questions to the Minister based on that. One of the problems - well, I will not start with a problem. Let me start with a positive thing.

In their literature review, some of the authors of works that the students in the master of public administration program referred to when they were preparing this report noted that psychological attachment to the organization, i.e. the employer, if positive, yields personal benefits for the employee as well as benefits for the organization. The translation of that is when people are treated decently, they work better and one has a better work force. I think the Minister should consider that.

Another problem that has been noted in the climate of restraint is that there appears to be a movement toward seeking passive and dependent individuals who do what they are told to do. This leads to a regime dominated by policies, rules and regulations that create a command and control environment. The employees' focus is supposed to be following the rules, which can be to the detriment of service delivery to the client.

Does the Minister believe in a command and control environment?

Hon. Mr. Nordling:

To a certain extent, yes, but there have to be clear goals and objectives, good lines of communication and feedback, so the employees feel relevant and are actually rewarded for their efforts.

When the Member says that employees who are treated well, will work well for their employer, I agree with the Member. There may be some disagreement as to what is being treated well and what is not, depending on the circumstances, but, generally, her contention is correct.

Ms. Moorcroft:

In the present public service environment, with the focus on doing more with less, frustrations are evident. What this report has discovered is that the longer people work in the public sector, the more inclined they are to be dissatisfied; for instance, to feel that they are not adequately supported by their supervisor.

Why does the Minister think that people become jaded with more experience in the public service?

Hon. Mr. Nordling:

I am not sure, but I think there is a general frustration with bureaucracy - it does not matter whether it is working for the government, working for General Motors or for IBM. There are systems built that stymie initiative. I think, after people have been involved in that, if there is no change or allowance for employees to express themselves, to feel relevant and to feel like they are making a contribution and accomplishing something, there can be frustration.

This is probably true with the Yukon government, because it is a large organization, but I would take the Member back to the other comment that employees have made - that the vast majority of them did like their jobs, despite the frustrations.

Ms. Moorcroft:

What I would like to ask the Minister is this: how are they going to address that problem of discontent and mistrust? What are they going to change?

Hon. Mr. Nordling:

What I want to improve within my own department is the communication and the sense that there can be input from all staff members. I want to see that there are clear goals and objectives to give the employees some enthusiasm with respect to working toward a goal, and being more efficient, and being production oriented, as opposed to process oriented, and to improve public relations within Government Services, which seems to be one of the problems, and improve relations between departments as well as within a department - different groups within one department sometimes feel they are at odds or working in different directions, or toward different goals.

Ms. Moorcroft:

Those are fine words. The Minister has just talked about enthusiasm, and about how there can be input in working toward a goal - for instance, the goal of a collective agreement? We certainly have not seen any evidence of the Minister accepting any input from employees on working toward that particular goal.

In the Yukon government employee survey there is a chart that indicates 25 percent of the government's workforce is employed in rural Yukon locations. Is that declining, or is the Minister's intent to leave that as it is?

Hon. Mr. Nordling:

I think that it has declined a bit.

Ms. Moorcroft:

For what reason, and is the Minister concerned about that?

Hon. Mr. Nordling:

It is a concern and my understanding is it is being looked at right now by each department. We are looking at the services that are delivered in Whitehorse and in the communities and trying to rationalize those services.

Ms. Moorcroft:

There we go with that word "rationalize" again, which often means "cut". I will wait with bated breath to see what develops on that front. I am looking at table 5 in the survey, which gives a breakdown of gender distribution and it refers to some of the research undertaken by the employment equity branch.

I am wondering, though, why there is no table with a breakdown of the four levels of the pay scale with the male/female data in each grouping of levels of employment. That would be helpful information. Was it done and is it available?

Hon. Mr. Nordling:

My understanding is that it was not done as part of the survey. I do not have a copy of the survey in front of me. I know what the Member is talking about, but I cannot refer directly to the page that she is on, or agree or disagree that that information would be helpful alongside it. All I can tell her is that that was not done as part of the survey, so we do not have that.

Ms. Moorcroft:

One of the reasons that that information would be useful is in implementing effective employment equity programs. What one often finds when governments are looking at downsizing and cuts is that people who are presently disadvantaged - those who are considered to be eligible for employment under employment equity programs - are the ones who do not have work when the cuts happen. I think it is important to know where we stand now, in order to improve having a more representative workforce.

There is a fairly significant percentage of workers, particularly in the group below the management level, who do not believe there are adequate opportunities for advancement in the Yukon government. How is the staffing branch going to be addressing that concern and what are their priorities going to be with their budget over the next year?

Hon. Mr. Nordling:

That is an interesting question and one I have not looked at. I could speculate, but I may get myself in trouble. I will say that I will take it as a representation, and I will look into it.

With respect to advancement, I do not know that people in the more senior positions do not move, or that there are not job openings for them. Perhaps that is the case, but it is the goal of our department to provide as much training and upgrading as we possibly can for the employees.

Ms. Moorcroft:

About 46 percent of the respondents within the public service found the budget system to be inflexible and unable to respond to changing needs. Has the Minister considered

Page Number 2816

that problem and what are they looking at doing about it?

Hon. Mr. Nordling:

Yes, we recognize it is a problem and we blame it on the Department of Finance.

I do not know what representations we can make. If the Member has some, I will certainly pass them on, but it is a system that seems to have been in place for a long time.

There is some validity in that complaint. It is just a matter of how we can do it without losing control of the situation. One of the things the Government Leader has often talked about is changing the Financial Administration Act to take away the provision that makes it an offence for the government to overspend its budget, to try to prevent the padding in budgets. With respect to flexibility, I do not know exactly what we can do with the Department of Finance.

Ms. Moorcroft:

Over here, we do not know whether to blame the Minister of Finance or the Minister responsible for the Public Service Commission, but there certainly are some problems, not just with the budget but with the approach they are taking toward their employees. In particular, their refusal to negotiate, and their failure to engage in collective bargaining, is creating a problem for the workforce and for the Yukon community.

The graph describing people's impression of the hiring and recruitment process of the Yukon government is quite interesting, because there is a fairly large number who believe the hiring is unfair. How is the Minister going to address the concern that the process that selects the right person for the job is not presently in place?

Hon. Mr. Nordling:

That is a problem, and the department has started to try to address it. At the present time, I cannot provide the Member with the details of exactly what the approach will be. The Auditor General also commented on that issue in the report. It is something that has to be looked at, and something definitely needs to be done with it.

Ms. Moorcroft:

I can see that the Minister is going to have a lot of things to look at here. Before I leave the survey, I do want to note that fully 92 percent of Yukon government workers found that their co-workers were cooperative and supportive. Obviously, there is a good sense of a collaborative approach within the public service, as far as working with their immediate neighbours within departments. That same measure of confidence is not in place with regard to this government and its approach to workers. We will be saving that debate for the public sector compensation restraint legislation.

Mr. Cable:

I have a few questions about the severance policy for deputy ministers. Is it the Minister's, and the Public Service Commission's, policy to put deputy ministers under contract now?

Hon. Mr. Nordling:

Yes, the new hires enter into a contract.

Mr. Cable:

Do the contracts incorporate the Cabinet policy that was put out, effective February 1, 1994? Is that part of the contract?

Hon. Mr. Nordling:

Yes, it is.

Mr. Cable:

I have a few questions revolving around that, but really relating to the relationship between the Public Service Commission and the government. Who recognized that there was some problem with deputy minister severance packages? Was that the government, or the Public Service Commission?

Hon. Mr. Nordling:

I believe it was the government. My recollection is that the problem was recognized with the settlement packages that were being negotiated. The government thought there should be some standardization.

Mr. Cable:

I think the act speaks about regulations being made on the recommendation of the Public Service Commission. That would actually suggest that it is the Public Service Commission that initiates personnel policies. From what the Minister just said, is that not the case?

Hon. Mr. Nordling:

The government identified the problem, but the Public Service Commission did the research and provided proposals to be considered.

Mr. Cable:

This new regulation speaks about the enactment pursuant to subsection 208(2) of the Public Service Commission Act and on the recommendation of the Public Service Commission. Is the Minister saying that the Public Service Commission actually made a number of options, or that they formally presented a recommended regulation to the government?

Hon. Mr. Nordling:

I am not exactly sure what the Member wants. I do not have it in front of me. Could he clarify exactly what he wants, or read the section? I am not sure whether we are talking about the appointment of deputy ministers or whether we are talking about how the decision was made to come up with the regulations with respect to hiring deputy ministers.

Mr. Cable:

There was a problem identified - I believe by the government - in that there were some indefinite terms of reference on how much they had to pay out to three or four deputy ministers when they were terminated. I would like to find out who actually initiated the policy. Who actually initiated this regulation that changed the policy and then permitted the Management Board directive to come into place?

Hon. Mr. Nordling:

The way I understand it, the problem was identified by the government; it gave direction to the Public Service Commission; the Public Service Commission looked at the problem and came up with suggested solutions and draft regulations that were considered. Some form of that was adopted by Cabinet and put into place. I believe those are what the Member has a copy of.

Mr. Cable:

Yes, I do. Why was the policy not actually incorporated in the regulations? Why do we have this Cabinet policy thing dangling around when all of it could, conveniently, have been put - I would think - in the regulations?

Hon. Mr. Nordling:

I think it was just a matter of choice. The levels are legislation, regulation and policy. Normally, regulations do not have the sort of detail written into them that the policy does.

Mr. Cable:

If I remember it correctly, and I do not have the old regulation in front of me, a number of sections that had some detail in them were revoked. Perhaps the Minister could check with his deputy on this. It appears that five sections were revoked, which I think had some of the detail about which the Minister was just talking. Is there a problem with putting that sort of thing in the regulation, where it is visible for everybody on the street to see?

Hon. Mr. Nordling:

As far as I know, the policy is just as available for all to see as the regulations, so I do not know what evil the Member is trying to prevent or solve by wanting the policy put into the regulations. If there is a suggestion about that, I will take it as a representation, but I do not know the problem the Member is trying to identify for me.

Mr. Cable:

Statutes and regulations are readily visible to anybody who wants to walk in the library or anywhere else where regulations are held. Management Board directives or Cabinet policies - while they may be legally accessible to people - are not that visible to somebody in the street. What is the reason? I do not quite understand why the full mechanics of the policy would not be put into the regulations. They do not seem to be overly detailed. One would not think it would be a major effort to put them in the regulations.

Hon. Mr. Nordling:

I am not sure. I was not involved in that decision and do not have access to it at my fingertips but I can try to find that out for the Member and provide information to him on the rationale behind doing it in the form that it was done.

Page Number 2817

Mr. Cable:

The Cabinet policy, when read with the act, suggests that people can be fired without cause because they lose pleasure. I have asked this question of the Government Leader and I would like to know what, in the Minister's view, would cause somebody to lose pleasure with the government and to be fired without cause?

Hon. Mr. Nordling:

I am not sure. I think it is pretty difficult to explain it or to put into words, but I would hope that I as a Minister, would know it when I say it.

Mr. Cable:

I am not sure what that answer means.

I think the cap is 15 months, and if one was to go back to the deputy ministers' top pay scale of $119,000, it comes to around $150,000. I am curious about why someone would get $150,000 because, "poof", someone has lost pleasure with them. Is there a definition that determines when being dismissed without cause would be operative?

Hon. Mr. Nordling:

No, there is no definition. I can provide the Member with an answer on the rationale of how the system was set up and some reasons for why. I am sure that there was justification and it was discussed. I think that the Member's figure of $150,000 was possibly reasonable under the circumstances. These are senior positions. They are well-trained people and losing their job has a considerable impact on future employment, I would think. It is compensation for the risk that they take by serving at pleasure.

Mr. Cable:

I am not attacking the fairness of the severance, I am simply wondering and am curious about what would trigger dismissal without cause. Would the Minister consider that a lack of congruency and political philosophy would trigger that sort of dismissal?

Hon. Mr. Nordling:

I do not know. I think that if a deputy minister felt that they could not, in good conscience, work toward the goals and objectives of the government of the day, that may be reason. It may work either way; it is difficult to speculate. I do not know if the Member is asking me if a deputy minister would be dismissed simply because they carry a party card that is different from that of the Minister of the day, then certainly not. I would not expect that to be a reason for dismissal.

Mr. Penikett:

Do I take it from the Minister's remarks that it is now acceptable for a deputy minister to hold a party card?

Hon. Mr. Nordling:

No, it is not. I was using that as an example in order to make it clear to the Member that talking about political philosophy or beliefs should not be enough to cause the dismissal of a deputy minister. The Leader of the Official Opposition is correct; deputy ministers are not allowed to carry political cards.

Mr. Penikett:

We did have one deputy minister once who objected to that rule, but he is no longer a part of the government.

I want to ask the Minister a question. For example, in a purely hypothetical case, let us assume that the government has recently hired a deputy minister who had been active in the Conservative Party. Given the Minister's statement that they would not be encouraged or permitted to be a member, what instructions or advice is given to deputies now who are recruited by the government in respect to political activities? Is there any formal instruction or any formal notice given?

Hon. Mr. Nordling:

Not specifically, but they are given copies of the Public Service Commission Act, which discusses that. We expect that people hired at that level would be fairly aware of their position and how they should act and perform in the position.

Mr. Cable:

Back to the dismissal without cause. I have to think that this policy was brought in for some reason and that there would be some sort of activities contemplated whereby the government would want to dismiss somebody and pay them money. Generally, if somebody is dismissed with cause, of course, they do not get paid any money. This policy sets up a dismissal without cause. Is there some sort of underlying factor that would trigger this sort of dismissal?

Hon. Mr. Nordling:

No, that is what we have been discussing. It is not a new idea that deputy ministers serve at pleasure. That was not created by the policy that came into effect in February; that has been the way it has been for deputy ministers for a considerable number of years that I am aware of.

Ms. Moorcroft:

In the budget lockup, we were given a summary of the estimated payroll savings of the proposed compensation restraint legislation. I would like to ask the Minister if this has been updated, since he indicated that the legislation had been updated to take into account the increment merit freeze. Has that figure been reduced since the initial summary that was presented to us?

Hon. Mr. Nordling:

Yes, that is correct. I will have that for the Members of the House when we start the debate on the Public Sector Wage Restraint Act. I believe I gave a copy of an updated version to the Member for McIntyre-Takhini that does show the reduction. I believe the Member has it in her hand. I will have more detail with me this evening.

Ms. Moorcroft:

Could the Minister, then, explain the line of Operations Closure for $1,099,000 and tell us if that line is still there?

Hon. Mr. Nordling:

No, that is no longer there. It was the three-day Christmas closure for PSAC employees. That is the grinch line that has been removed.

On Finance and Administration

On Activity

On Administration

Ms. Moorcroft:

If the Minister could give a brief description of the programs as we go through, that would suffice. If I have questions, I will stop him and ask them.

Hon. Mr. Nordling:

I am prepared to do that. There is not too much change in most of them. There is a decrease in finance and administration at the administration level. Personnel dollars are decreased by four percent due primarily to an overexpenditure in 1993-94 for a maternity top-up benefit. Unemployment insurance pays 75 percent, and we top it up to reach 93 percent. There was some salary to replace that individual. The 13-percent decrease in Other is simply due to a reduction in program materials and supplies.

Administration in the amount of $387,000 agreed to

Finance and Administration in the amount of $387,000 agreed to

On Staffing

Chair:

Is there any debate?

Ms. Moorcroft:

I note that the objective of the staffing branch is to ensure the integrity of the staffing process, and I would like to ask the Minister why he abolished the four levels of pay structure for deputy ministers?

Hon. Mr. Nordling:

I did not abolish the four levels of pay for deputy ministers. That was done by Cabinet in December. I have been told that the rationale for that was that it was more convenient for deputy ministers to be on one pay scale. I have been told that it is fairly common among other jurisdictions not to have four levels as we did.

I have been told that, initially, the departments were put into the categories dependent upon their importance, and that there was a desire to get away from categorizing one department as being more important than another department, or one deputy minister more important than another deputy minister, depending upon the portfolio he or she held at the time. This restructuring put all of the deputy ministers on a level playing field that made them members of an equal team, rather than one being superior to

Page Number 2818

another.

The other rationale I heard was that it would result in cost savings. I accept that that, in theory, is possible, but I do not know how that will work in reality. The rationale there was that if you moved a deputy minister, for example, from the Legislative Assembly, into Community and Transportation Services under the old system, the salary would have to be increased a substantial amount to meet the lowest level in Community and Transportation Services. With one pay level, the government would not necessarily have to jump that deputy minister's salary with the move.

Ms. Moorcroft:

The Minister talks about an equal team, but it was my understanding that that entire range of salary options was still there - that the lowest pay level and the highest pay level were all still within this one level that used to be divided into four levels. It seems to me to be convenient that the government can no longer be held accountable for what pay range a deputy minister is in, so when they have hired a new deputy minister, as they have done recently, there is no way of inquiring whether that deputy would be in the top range under the old scale or in the middle range because it is just all one scale. There is no accountability there.

Hon. Mr. Nordling:

I am not sure what the Member is saying by accountability. Perhaps she is saying that now Members of the Opposition and the general public cannot pin down a deputy minister's salary with the same amount of confidence as they could when they knew that the deputy minister was appointed as a deputy minister 1, 2, 3 or 4.

The range is broad, but the deputy ministers are slotted in based on their experience, training and the income that they had prior to accepting the appointment as a deputy minister. I think the deputy ministers do accept that there are some who will be getting paid more and some who are getting paid less, depending on training and experience. I think that it does take away the element of one deputy minister being more important than another one because he or she is the Economic Development deputy minister, as opposed to the Tourism deputy minister.

Ms. Moorcroft:

What it takes away is the ability to know what the pay range is for the highest paying jobs in government. The staffing branch, under the breakdown of the reorganization of the department the Minister gave, is responsible for attainment of a workforce representative of the Yukon population. I would like to ask the Minister whether departments are still reporting their employment equity plans and how their activities in the past year have measured up to the actual plans.

Hon. Mr. Nordling:

Yes, they are, and we will be producing a report on it. It has not been done at the present time. I believe it has to go to Management Board before it is available.

On Activities

On Staffing Administration

Hon. Mr. Nordling:

This is a four-percent decrease in total - five percent in personnel dollars and one percent in other dollars. The personnel decreases are mainly due to changes in staff resulting in lower salaries.

Ms. Moorcroft:

What have been the changes in staff resulting in lower salaries?

Hon. Mr. Nordling:

We eliminated a director's position, and we expect that it will be filled with a less senior position.

Staffing Administration in the amount of $463,000 agreed to

On Staffing Operations

Hon. Mr. Nordling:

There is no change.

Staffing Operations in the amount of $82,000 agreed to

Staffing in the amount of $545,000 agreed to

Chair:

The time being 5:30 p.m. we will recess until 7:30 p.m.

Recess

Chair:

I will now call Committee of the Whole to order.

On Employee Records and Pensions

Hon. Mr. Nordling:

In this area there is a three-percent increase in personnel and an eight-percent decrease in Other. The three-percent increase in personnel costs are due to staff turnover resulting in higher salaries than budgeted during 1993-94. The eight percent decrease for program dollars is a result of a reduction in supplies from the streamlining of forms and paper flows - from $13,000 to $12,000.

On Activity

On Administration

Hon. Mr. Nordling:

This is the overall result of the combined increase in personnel of three percent and a decrease of eight-percent in Other allotments.

Administration in the amount of $500,000 agreed to

Employee Records and Pensions in the amount of $500,000 agreed to

On Labour Relations

Hon. Mr. Nordling:

Labour Relations shows a 14-percent net decrease over the 1993-94 forecast. In personnel, there is an increase of seven percent due to conversion of a term position due to end in December of 1993, to an indeterminate position. The position was budgeted for only eight months of 1993-94. Also, the cash bonuses for long-service award recipients has increased due to the larger number of recipients. There is a decrease of 52 percent, from $233,000 to $111,000 in Other, under Allotments, due to the elimination of some of the funding for collective bargaining in 1994-95, and a reduction in the estimated costs for indemnification of employees.

Ms. Moorcroft:

I certainly have a question about the 52-percent reduction in Other, and I wonder if that is the reduction the Minister just referred to in speaking to a reduction in the cost of collective bargaining. It does not cost very much money when you do not engage in it. What is the explanation of this 52-percent decrease in Other under the Allotments?

Hon. Mr. Nordling:

The Member is correct. That is the decrease in collective bargaining. We did not expect there to be the same protracted collective bargaining and outside staff requirements that we had last year. We budgeted less in that area, expecting to use people from the department.

Ms. Moorcroft:

Does that mean that the department did not expect to engage in collective bargaining when this budget was put together, or was this decrease a later development?

Hon. Mr. Nordling:

It was a later development that occurred after the wage restraint legislation was proposed.

Ms. Moorcroft:

I would like to ask some questions related to the statistics that are on the facing page. There is an estimate of a 25-percent increase in the forecasted number of grievances. Why are they estimating this kind of a jump and what is the Minister planning to do to precipitate grievances?

Hon. Mr. Nordling:

We hope not to do anything to precipitate grievances. Grievances may be filed by both YEU and YTA members. In addition, the 1994-95 grievance estimates may also include Workers' Compensation Act health and safety appeals, and we expect that with the lack of collective bargaining and with wage restraint legislation, employee concerns will be more often grieved than an attempt being made to negotiate directly with the employer.

Ms. Moorcroft:

Well, that is a good reason why the Minister should consider the value of collective bargaining. One will have more grievances if one is treating employees without any respect.

There is also a 19-percent increase in adjudication and/or court actions shown. What was the reasoning behind this increase?

Hon. Mr. Nordling:

That is simply the direct result of the

Page Number 2819

increase in the number of grievances.

Ms. Moorcroft:

What kinds of grievances do they expect to see more of?

Hon. Mr. Nordling:

They could be in any area. I can speculate that reclassification may be an area in which employees will grieve if they are not reclassified.

Ms. Moorcroft:

There is also a 32-percent increase in the competition appeals shown here. Was that put in because of the concerns that were raised in the Yukon government employee survey about the hiring process being unfair?

Hon. Mr. Nordling:

No, not necessarily. We have brought that number back up. The six-month hiring freeze, in effect during 1993-94, resulted in fewer competitions and a 49-percent decrease in competition appeals. The 1994-95 estimate is based on an anticipated increase in the number of competitions over 1993-94 - closer to the average level.

Ms. Moorcroft:

While we are on general debate in labour relations, I would like to go back to another area of the government employee survey, and that is the concern about political consideration. When I asked the Minister about this in Question Period, he said the government wanted to let the managers manage, that he was not sure what the 20 percent, who indicated a concern about political interference, meant. There are a number of comments here where there is a general sense that there should be less political involvement in administrative decision making.

The Minister indicated his hope that it would become political involvement, not political interference. What does he see as the difference between the two?

Hon. Mr. Nordling:

Political involvement is giving the department clear goals and objectives we, as a government, want to achieve. Political interference would be dealing directly with the lower levels of the department, and giving them orders as to what to do and how to do it to achieve that goal and that objective.

Ms. Moorcroft:

There was a comment made that there was a lack of a sense of purpose and morale among employees with the lack of a majority government. I am not sure how much better morale or sense of purpose they now have with a majority government.

They also indicated that clearer political vision and direction is needed. What kind of political direction is the Minister planning to give his department?

Hon. Mr. Nordling:

That goes back to clear goals and objectives and clear expectations from the department.

Ms. Moorcroft:

What are his goals, objectives and directions?

Hon. Mr. Nordling:

With respect to the Public Service Commission and the Department of Government Services, we are service oriented, we provide a service to other departments of government and we deal with the private sector.

Our goal is to provide service that is customer driven. What seems to have been happening is that we have been taking the lead role, and instead of dealing with our clients we have essentially been telling them what we are prepared to do and when.

We discussed this earlier this afternoon in respect to recruitment, and I agreed with the Member that there are serious concerns about that process and that we need to look at everything from our evaluations to how we advertise for positions.

Ms. Moorcroft:

I am not sure that I would agree with the Minister that it is a lead role to go about dictating exactly what is going to happen, which is what this government has done.

The cut to the Yukon Employees Union and the Yukon Teachers Association in the labour relations budget, I think, shows this government's disdain for the employee relationship. The government's projected cuts have already been an effective way of eroding the relationship with the employees.

What was the actual cost that was put in the budget for negotiating with the teachers and with the Yukon Employees Union?

Hon. Mr. Nordling:

It is broken down into the YEU, PSAC, Teachers Association and managerial and confidential exclusions.

Managerial has remained at $5,000 for 1994-95. Last year, the forecast for the Yukon Teachers Association was $30,000, and it is now $8,000. The forecast for the Public Service Alliance of Canada is reduced from last year's $182,000 to $95,000 for 1994-95.

Ms. Moorcroft:

Well, we have seen what the government has done to meet with the Public Service Alliance and the Yukon Teachers Association. What steps have they taken to meet with the managers, as a group?

Hon. Mr. Nordling:

We have not met with the managers, as a group.

Ms. Moorcroft:

Are they planning to do that, and could the Minister provide some kind of a breakdown on the $5,000 they have put in here for managerial/confidential exclusion?

Hon. Mr. Nordling:

The $5,000 in the budget is for appeals.

Ms. Moorcroft:

Are they planning, then, to take any steps to meet with the managers, as a group?

Hon. Mr. Nordling:

No.

Ms. Moorcroft:

Well, that is typical. I would like to ask about terms. During the last session, we had a question about term employees and a recent arbitral decision that had decreed that term employees could no longer carry over their benefits, should their term be extended. At the time, the then-Minister said they were looking at that and would make a further decision on how they were going to handle it. Is there any progress to report on that?

Hon. Mr. Nordling:

Yes, there has been, and if a term is extended before the end of the term, the term employee can carry over all the benefits.

Ms. Moorcroft:

Have there been any cases of term extensions then?

Hon. Mr. Nordling:

Yes, there have been, but I do not have the number of exactly how many.

Ms. Moorcroft:

If the Minister is going to bring that back, I would also like him to bring back the information on whether there were any term employees who started again - who had their term end and then started in another position and so were not able to carry forward their increments or their benefits package.

Hon. Mr. Nordling:

Yes, we will try to do that. I am told that is sometimes hard to trace, but we will do the best we can, both for the Member and for my own information.

Chair:

Is there further debate?

On Activities

On Administration

Ms. Moorcroft:

If the Minister could just provide a brief explanation of the lines as we go through them, I will ask him any questions I have.

Hon. Mr. Nordling:

With respect to the five-percent increase, the information I have is that two terms were converted to indeterminant and budgeted for a full year. That accounts for the increase.

Administration in the amount of $390,000 agreed to

On Yukon Government Employees Union/Public Service Alliance of Canada

Yukon Government Employees Union/Public Service Alliance of Canada in the amount of $95,000 agreed to

On Yukon Teachers Association

Ms. Moorcroft:

I have already asked the Minister about the reductions and he has given an explanation of that. Is the $95,000 for the PSAC and the $8,000 for the Yukon Teachers Association funding in place for them to do whatever limited collective bargaining might occur in the future during this budget year?

Page Number 2820

Hon. Mr. Nordling:

Yes, that is where it would come from.

Yukon Teachers Association in the amount of $8,000 agreed to

On Managerial/Confidential Exclusion

Managerial/Confidential Exclusion in the amount of $5,000 agreed to

On Long Service Awards

Long Service Awards in the amount of $47,000 agreed to

On Indemnification

Hon. Mr. Nordling:

On indemnification - the reduction from $10,000 to $5,000 is simply a contingency fund estimate based on costs for legal and judgment fees for one dispute.

Ms. Moorcroft:

Is that a particular dispute that they expect to deal with in the coming year?

Hon. Mr. Nordling:

No, it is strictly contingency.

Indemnification in the amount of $5,000 agreed to

Labour Relations in the amount of $550,000 agreed to

On Workers' Compensation Fund

Hon. Mr. Nordling:

The fund shows a three-percent increase in personnel costs from the previous year, due to costs in 1993-94 for claims filed prior to January 1, 1993, being less than anticipated. These prior claims will continue to be the responsibility of the Government of the Yukon.

Mr. McDonald:

That caught my attention. Did the Minister indicate that he anticipates the personnel costs for government rising three percent? Is that what he said?

Hon. Mr. Nordling:

Along with that is the increase in the assessment rate - the premiums for 1994-95.

Mr. McDonald:

I do not recall hearing an announcement by the Workers' Compensation Board about increased assessment rates. Is he anticipating that they are going to be increasing their assessments?

Hon. Mr. Nordling:

My understanding is that it is automatic in the legislation, and our assessment has gone from $43,000 to $46,000.

Mr. McDonald:

Let me get this straight. Did the Minister say that the payroll itself was going to increase? He seemed to suggest that in his initial answer. Is the payroll going to increase?

Hon. Mr. Nordling:

No, it is not. The word "personnel" should not have been typed in the three-percent increase in costs. It is the total.

Mr. McDonald:

It is a clerical error. With respect to the experience of this last year, the 1993-94 estimate, did any money lapse in this particular area for 1993-94?

Hon. Mr. Nordling:

Yes, there was a small lapse. The 1993-94 forecast was $1.466 million, which is in the budget book. The 1993-94 year-end expenditure we expect will be $1.421 million. The reduction is the result of past claims costs and premiums for the current claims being less than anticipated.

Mr. McDonald:

I was under the impression that past claim costs were absorbed in the Department of Finance. Is that not the case?

Hon. Mr. Nordling:

No. I am told that that was under the old act.

Mr. McDonald:

Finance is certainly absorbing some costs for Workers' Compensation, because we just voted that. I do not want to dwell on this at any great length. Is the Minister saying that last year's experience is going to increase three percent, so it should be $1,421,000 plus three percent?

Hon. Mr. Nordling:

No. We expect the 1994-95 expense to be $1,507,000.

Mr. McDonald:

I am just trying to understand the methodology here. The Minister has said that, by legislation, the increase would be an automatic three percent over the last year's experience. He said that last year's experience was $1,421,000. I do not think that three percent of $1,421,000 added on to that amount adds up to $1,507,000. I realize this is a small number, but I am just trying to understand precisely what has happened.

Hon. Mr. Nordling:

I will try to explain it to the Member, and then we can talk about it again, if this is not clear.

My understanding is that the $1,507,000 we have is based on the payroll times $46,000 per year. The $46,000 is the figure that is up from the base of $43,000. The rate, based on our total payroll, times $46,000, gives us the $1,507,000. That is what it is based on, not an automatic three-percent increase from the previous year.

On Activity

On Workers' Compensation Payments

Workers' Compensation Payments in the amount of $1,507,000 agreed to

Workers' Compensation Fund in the amount of $1,507,000 agreed to

On Compensation

Chair:

Is there any general debate?

Hon. Mr. Nordling:

We talked about this in earlier general debate on the whole department. The breakdown of the three-percent increase in personnel from $416,000 to $530,000 is due to position vacancies in 1993-94 that will be staffed in 1994-95. What appears to be a huge increase in Other - the $44,000 to $154,000 - is due to the inclusion of funds to investigate the repatriation of the superannuation fund.

Ms. Moorcroft:

I have some questions arising from the statistics on compensation on the facing page.

The classification appeals projects an increase from 16 appeals at first level to 40, which is an increase of 150 percent. Why is that?

Hon. Mr. Nordling:

If the Member is asking about the increase from nine to 15 appeals to the Classification Appeal Board, it is based on six appeals that were begun in 1993-94, but which are still to be heard in 1994-95, and because we expect more appeals to go directly from the first level to the classification level.

Ms. Moorcroft:

The Minister answered my next question, but he has not answered the question that I have already posed to him. I did wonder why there were more appeal board hearings than there were second-level appeals, because you have to go to second level before you can go to the appeal board, but the Minister said there were six coming forward from last year.

I also want to know why they have projected an increase of first-level appeals, an increase of 150 percent of the first-level classification appeals. Why?

Hon. Mr. Nordling:

The estimate for first-level appeals is based on an average of actual appeals for 1991-92, 1992-93 and 1993-94. The actual number for 1993-94 of 16 was considered to be an aberration. This resulted in an a 150-percent increase over the uncharacteristically low number for the previous year.

Ms. Moorcroft:

Well, it was uncharacteristically low in the last year, so the government is estimating high for this year; however, they have indicated a forecasted reduction in the number of classifications that they are going to do. Is the government anticipating some problems?

Hon. Mr. Nordling:

We had a lot to do for the expected forestry transfer and that was the reason for the higher number.

Ms. Moorcroft:

Do they still expect the forestry transfer to occur in the next year?

Hon. Mr. Nordling:

I do not know, but if it does go through, we have the classifications done.

On Activities

On Administration

Hon. Mr. Nordling:

With respect to administration, it is broken down into the 530 personnel and Other. I have explained the increases there being the greater amount including personnel and part of Other.

Page Number 2821

Administration in the amount of $662,000 agreed to

On Classification Appeals

Classification Appeals in the amount of $22,000 agreed to

Compensation in the amount of $684,000 agreed to

On Corporate Services and Employment Equity

Chair:

Is there any debate on corporate services and employment equity?

Ms. Moorcroft:

Is there an introductory comment?

Hon. Mr. Nordling:

There is a total reduction of five percent in this area - one percent in personnel and 31 percent in Other. The decreases are attributable partly to the wage restraint legislation. Travel to Yukon communities will be multi-purpose for each trip and include more communities, to reduce the number of trips. There are reductions in the estimated cost for recruitment and training for the native training corps positions, due to cost-sharing agreements with the sponsoring departments. There are reductions in costs for employee publications, due to streamlining of publications and some reduction in program materials.

Ms. Moorcroft:

The Minister indicated in general debate that the employment equity program, to coordinate and monitor the equitable representation of women, aboriginal people and people with disabilities at all levels and employment categories of the government work force, would be split in the new organization between the corporate human resource services branch and the research and planning branch. Can the Minister explain how we can determine where the money is going and how it is going to be split up in the Public Service Commission reorganization?

Hon. Mr. Nordling:

In the line item above, there is native training at $307,000. That is the actual program cost, so that can be seen in that line.

Ms. Moorcroft:

Well, that is only one function of the overall employment equity program, so I do not think he has answered the question very well. Are the employment equity functions going to be devolved to the departments or are they going to remain the overall responsibility of the Public Service Commission?

Hon. Mr. Nordling:

These are the amounts that are being spent, but with the reorganization the monies will be moved to the corporate human resource management branch - the new branch of the department.

Ms. Moorcroft:

It is precisely because we find it so difficult to get accurate budget information from the government that we would like to have an explanation of this as we go through it. I guess we will be dealing with it again in the supplementary budget.

Of the native training program of $307,000, how much is actually spent on training?

Hon. Mr. Nordling:

It is all spent on training, in that it is salaries for people.

Ms. Moorcroft:

Can I ask the Minister to provide a breakdown of the $660,000 that is going to be spent on personnel?

Hon. Mr. Nordling:

Apparently, it is in a couple of different places, but I will get that back to the Member if she does not mind waiting until tomorrow for it.

Ms. Moorcroft:

That will be okay.

How many clients do they anticipate having in the native training program, the job entry program and the other employment equity services that they offer?

Hon. Mr. Nordling:

In native training, we have salary and benefit costs for six term full-time staff.

Ms. Moorcroft:

I was not enquiring about the numbers of staff. I was enquiring about the numbers of clients in the various programs. I am trying to find out if there will be a decrease in the level of service. Does the Minister have any information about the numbers of clients they have in the different programs in this branch?

Hon. Mr. Nordling:

I will have to bring that back to the Member with the breakdown of personnel.

On Activities

On Administration

Administration in the amount of $356,000 agreed to

On Native Training

Native Training in the amount of $307,000 agreed to

On Disabled Job Entry

Ms. Moorcroft:

Could the Minister describe this program briefly?

Hon. Mr. Nordling:

It is made up partly of salaries and monies to develop an effective inventory of target group people.

Ms. Moorcroft:

Have they succeeded in any placements within the public service in the last year, and how many do they project to place in the next year?

Hon. Mr. Nordling:

There is just one at the present time, and we will continue to look for placements.

Disabled Job Entry in the amount of $42,000 agreed to

On Corporate Services

Ms. Moorcroft:

Does the Minister have an explanation of what this $20,000 will be spent on for corporate services? If he could also relate it back to the new organizational distribution, that would be helpful.

Hon. Mr. Nordling:

It will stay in this branch under communications. It is the money for The Sluice Box, the labour relations bulletins, and Manage It.

Corporate Services in the amount of $20,000 agreed to

Corporate Services and Employment Equity in the amount of $725,000 agreed to

On Leave Accruals

Hon. Mr. Nordling:

This amount is not actually set aside and budgeted for; it is a year-end entry made by Finance. The amount is estimated at the end of financial reporting periods. The program shows a decrease of one percent over the 1993-94 budget, due to an accrual in 1993-94 that was not identified at March 31, 1993, and had to be added to the 1993-94 accrual amount.

Mr. McDonald:

Can the Minister tell us what the actual experience was then with 1993-94?

Hon. Mr. Nordling:

I believe the Member for Mount Lorne has this material. The 1993-94 leave accruals were forecasted at $3,854,000. There will be an actual expenditure of $2,679,786 for 1993-94. It is due to fewer employee resignations and no wage increases for 1993-94.

Mr. McDonald:

Is the government intending to put the full $3,854,000 into the account?

Hon. Mr. Nordling:

No. What we will do is put in the $2,700,000 that we had in for 1993-94.

Mr. McDonald:

Then the Minister is saying that in November, when we were revising our estimates of $3.8 million, he found it necessary to add $54,000 to the account to bring the year-end account more closely to what they thought the experience would be, and then by year-end we dropped that down by approximately $1.1 million, because we did not feel we needed to spend all the money, after all. Is that it?

Hon. Mr. Nordling:

It was adjusted in the supplementary, because the $54,000 was found to be an error and was added on. We had not gone out to the departments to see what had been spent. We added the $54,000 to correct the error. Then, when the amounts came in from the departments, it was $2.7 million.

Mr. McDonald:

We have been in error virtually every year, in terms of any kind of precision, with the exception of this last year, which was a fairly sizeable error.

Can the Minister tell us what the total account now stands at?

Hon. Mr. Nordling:

We do not have the exact figure, but it is somewhere over $20 million.

Mr. McDonald:

I think it is a little higher than that. It is

Page Number 2822

certainly over $20 million, but probably closer to $25 million. I will be happy to hear what the Minister comes back with, when he tells us what the account is precisely, if he would not mind doing that.

Can the Minister tell us what the chances are of the government actually using this account, or needing the full $20 million-plus dollars in any given budget year? What would the chances be?

Hon. Mr. Nordling:

As the Member knows, the chances are remote, but the Auditor General has required us to do this. It would be nice if we could do something about slowing, or stopping, the payments, now that we do have somewhere between $20 million and $25 million in that fund.

Mr. McDonald:

I suspect that the chances of this fund being used in one year are probably about the same chances as all of the MLAs, the staff at the table and everyone in the gallery buying a ticket for the lottery, having the same number and all winning at the same time.

Obviously, this accounting exercise is seemingly artificial. There has been some talk about capping this particular fund, given the fact that it is an entirely artificial exercise that we will need to pay out everybody at once, unless we have misinterpreted what "no massive layoffs" means by the government.

Can the Minister tell us whether or not the government has given consideration to capping this account and eliminating the need to enlarge this program by even more money that will not be spent?

Hon. Mr. Nordling:

Yes, there has been some discussion between the Public Service Commission and the Department of Finance, but there has been no decision made exactly how and when to do that.

Some Hon. Member:

(Inaudible)

Mr. McDonald:

That should go on the record should it not?

To put one comment on the record, there is some cynical speculation on this side that perhaps the decision to bring this account down might be made a couple of years from now, maybe just before the election.

Could the Minister tell us when the decision is expected to be made? Is it going to be made in this fiscal year?

Hon. Mr. Nordling:

No, I cannot give the Member an estimate. Maybe I will know better in the fall.

With respect to the cynical comment: I do not think that will be the case, because we have seen what spending just before an election does to the government in power.

Mr. McDonald:

I think the obvious point here is that this government has made some claims about how poverty stricken it is, even though it is sitting on a fairly sizable surplus that is obviously going to become much larger in the future.

The Whitehorse Star has indicated the Yukon Party strategy - a strategy that was dismissed by the Government Leader last night but one that has a lot of credibility on the street - as being that the government is intending to restrict expenditures only to spend massively in the final year. I would think that there is some cause for concern on this side of the Legislature about the government's spending plans.

In this particular case, the government is going to be putting, they say, $3.8 million into leave accruals, $2.7 million of which we can probably expect will actually be spent.

The fund itself will get larger. As we go through this paper exercise of putting more and more money into this account that just keeps on getting bigger and bigger and bigger, we are forced into making tough decisions about other things - not only about schools and roads, but also about whether or not employees, who are putting money, through their paycheques, into the local economy, are going to be sacrificed as well. The $3.8 million that the government says it wants to put into this particular area far outstrips any - what they call - savings from the employees' paycheques that they are going to be brazenly taking or, as the government puts it, they are going to be contributing to the government's overall game plan of saving money and making the surplus bigger.

While this seems like an artificial exercise, the consequences of doing this are obviously quite significant. To not come to some conclusion in this fiscal year, after having discussed this matter two budgets successively - with the Yukon Party in government - and after we agreed that this fund was too big and is unneeded and when we know that to make this expenditure means that $3.8 million, or some portion of that could not be spent elsewhere - I think is nothing short of irresponsible.

I would encourage the Minister to actually encourage his colleagues to address the issue, so that when another contribution is going to be expected from employees' pockets, or the Minister of Education is going to stand up again and say that he still does not have any money for any schools - then the fact that we have freed up some money will permit people to address other priorities - priorities that some of us agree are higher than pleasing the Auditor General to the extent that we have.

Hon. Mr. Nordling:

The Member's comments are valid and I will encourage my colleagues to do something about it as soon as possible. I have been given the figure in the account right now - I will let the Member write it down. I am sure it will come up again, but I hope it will be with some resolution. There is $22.7 million in the fund at this time.

Mr. Penikett:

I know the Minister knows that I am nothing if not reverent and respectful to Ministers when I am putting questions in this House, but I did happen to hear the Minister say just now that the Auditor General had ordered us to create this fund of $22.7 million, which is tied up and cannot be used for any useful purpose. Is it not the case that the law and constitutional theory make the Auditor General a servant of this Legislature and not the master?

Hon. Mr. Nordling:

Yes, that is true, and the Leader of the Official Opposition probably knows exactly what the Auditor General said with respect to the creation of the fund because I think it was done under his administration. Perhaps, to get the fund started, it would be safe to say that the Auditor General recommended it and we accepted his recommendation. Now that the fund has grown to $22.7 million, perhaps it is time to go back to the Auditor General and say that there is plenty in the fund and ask why we have to continue to make these contributions.

Mr. Penikett:

I will just make a modest suggestion. I do not want to reveal any Cabinet secrets of former governments but I can confide in the Minister that a former government was actively thinking about the possibility of capping this fund because it had reached a ludicrous size. I am of the opinion that there is enough money in this fund that we should seriously think about whether it could be used for some other more useful purpose. Might I suggest that one of the purposes it might be useful for would be to provide the money for the Minister in this department to recommence collective bargaining at the earliest possible opportunity.

Disturbance in the gallery

Chair:

Order please.

On Activity

On Leave Liability

Leave Liability in the amount of $3,800,000 agreed to

Leave Accruals in the amount of $3,800,000 agreed to

On Staff Development

Chair:

Is there any general debate?

Ms. Moorcroft:

We have had some discussion of training issues in Question Period, and there are some statistics here on the number of courses conducted, the number of participants, and so

Page Number 2823

on. Is there a breakdown of the level of employees taking courses available?

Hon. Mr. Nordling:

We do not have that here, but we can get that. I do not know whether the Member wants it by level in the government or by department, or exactly what she would like to see. We can try to get her whatever she is looking for in that regard.

Ms. Moorcroft:

I know when they did the employee survey, they had a breakdown where they grouped classifications in four different levels. If that breakdown was available, it would be helpful.

In the survey, the employees had a number of comments to make about training, ranging from the need for training specifically related to their jobs, such as professional development, more bridging assignments, career training, and a lot of general comments on the need for more timely training. Have any of those comments, or the results of the survey, been taken into account in what the objectives of the staff development program will be over the coming year?

Hon. Mr. Nordling:

We have heard those comments within the Public Service Commission. We are talking to other departments about them. What the staff development and training is normally geared to is the need identified by the departments, so we will be working together to do that. With respect to getting the Member a breakdown, we will try to do it on the basis of the levels that were used in the survey conducted by the masters of public administration students.

Ms. Moorcroft:

Since the Minister has just mentioned the masters of public administration program, I note that it has been so successful that there are 18 graduates, and they estimate zero participants in that program for the next year. I would like to know two things. First of all, are all 18 graduates employees within the public service, and secondly, are they considering offering a similar program in the future?

Hon. Mr. Nordling:

There are 15 of the 18 within the public service. Whether or when we do it again will depend on the need that is expressed to do it again.

Ms. Moorcroft:

Are the graduates of the program going to be receiving a pay raise?

Hon. Mr. Nordling:

No, not as a result of their graduation.

Ms. Moorcroft:

Are they receiving pay increases as a result of performance increments?

Hon. Mr. Nordling:

If they perform, they will receive increases in 1995, after October for management and after January 1 for bargaining unit members.

Ms. Moorcroft:

I think perhaps the Minister's hesitation points out his need to have a talk with managers as a group, as well as commencing collective bargaining, but we will leave that for debate on the wage restraint bill.

On Activities

On Administration

Administration in the amount of $661,000 agreed to

On Operations

Operations in the amount of $611,000 agreed to

Staff Development in the amount of $1,272,000 agreed to

Public Service Commission agreed to

Chair:

At this time we will take a brief recess.

Recess

Chair:

I will now call Committee of the Whole to order.

Hon. Mr. Nordling:

I move that you report progress on Bill No. 15, entitled Second Appropriation Act, 1994-95.

Motion agreed to

Bill No. 94 - Public Sector Compensation Restraint Act, 1994

Chair:

We will now move on to Bill No. 94, entitled Public Sector Compensation Restraint Act, 1994. Is there any general debate?

Hon. Mr. Nordling:

I feel like we have been on general debate of this bill since the Legislature started in April.

All Members have a copy of the bill and I think that they have a copy of the savings in some detail as to what the effect of this bill is.

Briefly, the bill deals with all government employees: the unionized employees that are covered by the Public Service Alliance of Canada Agreement, those covered by the Yukon Teachers Association agreement and management.

After the expiry of the collective agreements for PSAC, which is December 31, 1994 -

Disturbance in the gallery

Chair:

Order please.

Hon. Mr. Nordling:

It extends the collective agreement to March 31, 1998. As part of that extension, it rolls back the wages two percent as of January 1, 1995, and it standardizes the Yukon bonus for those employees to $2,042 per government employee and it is not tied to Canadian Airline tickets; it is a flat bonus amount.

Again, the highlights - or lowlights as some may see them: with respect to the Teachers Association - this bill rolls back their wages two percent beginning January 1, 1995. The experience increments are unaffected. The teachers who are due for increments on their anniversary date - which for many, I think, is August 31 of this year - will receive their increments and they will receive them throughout the life of the agreement. It does not affect their Yukon bonus in that it remains at $2,042, which it is at presently.

With respect to management, the bill rolls back their salaries an additional one percent. They were rolled back two percent on April 1, 1993. It also standardizes the Yukon bonus for those employees at $2,042.

The two additional things are a job security clause in the present PSAC agreement that was scheduled to expire December 31, 1994. We have agreed to extend that job security provision through a memorandum of understanding with the union to the end of the extended collective agreement. With respect to the Yukon Teachers Association - we will contribute $90,000 per year to a professional development fund through the Department of Education.

Ms. Moorcroft:

When we concluded debate on second reading, the Minister indicated that there were a number of good points that Members in Opposition had made and that he would be responding to them. I was really hoping that there would have been a bit of a more serious response to the fact that this legislation is being completely driven by ideology and there is no bearing on the actual Yukon reality - there is no fiscal crisis; they have not demonstrated a financial need.

I guess what I would like to do is start out with asking the Minister a number of questions to which we have not been able to get an answer from him.

The Government Leader, early in the last session, and indeed the current Minister, in the Public Service Commission debate, indicated that unions have a role to play in the workplace, that there is a bargaining unit for all employees and, through that type of an organization, employees can make their concerns known. What does the Minister think has changed since the Government Leader made those comments?

Hon. Mr. Nordling:

I do not think anything has changed. The unions will continue to play a significant and important role

Page Number 2824

in the employee/employer relationship. There is a collective agreement in place now that I think is a reasonable agreement. It was negotiated with the Public Service Alliance of Canada, agreed upon by the parties, and they do play a major role.

There are ongoing discussions with the unions. There are processes and procedures that we have in place through the collective agreement that are ongoing. We are presently discussing issues with the union and that will continue.

This legislation does not in any way do away with the collective agreement or the relevance or the importance of unions. What it does is simply cap, or roll back, the monetary compensation by two percent.

Ms. Moorcroft:

If the unions had an important and significant role - what the Minister just said - we would not be debating this act. We would not have the Public Sector Compensation Restraint Act, 1994, if the Minister honestly believed that unions had an important and significant role to play.

What does he think is the purpose of the unions, and what does he think is the purpose of collective bargaining?

Hon. Mr. Nordling:

Everyone in here does that. I do not want to get into playing teacher/student games, with the Member for Mount Lorne making her points. If she wants to make a speech about how dastardly I am or how I do not understand it, she can stand up and do that.

My position remains the same: the unions do play an important role and will continue to. The reason we have a rollback is that it was made clear by the Public Service Alliance of Canada in previous negotiations what their position was with respect to rollbacks. They were telling us their position, and I remember reading a quote by Jim Brohman in the newspaper that said, "People do not pay union dues to walk backwards", and Mr. Hobbis saying that if the government wants rollbacks then they will have to legislate.

I accepted that was the way that they felt and, if I was in their position, I would probably also take that stance. However, I am not. I am responsible for the finances of government - for what happens in the Yukon Territory. I recognize that we are part of Canada. There is a financial crisis in our country, and we are part of it. We are dependent on the federal government; we do not have income like the provinces. We do not want to go tens of millions, or hundreds of millions of dollars in the hole, before we do anything about it.

Ms. Moorcroft:

The Minister's reputation is going to be based on what he does. I think that the Minister's declining reputation might be based on the fact that he cannot answer questions here, and that he will not answer questions here. It is not based on what I am asking him or my failure to ask him questions; it is based on his failure to answer them.

The Minister has some difficulty in defining what bargaining rights are. I have to wonder if he thinks that they are just hypothetical. The existence of unions is a recognition of the fact that there is a power imbalance between employers and employees. A collective voice of workers is the only way that they can have a voice. It is the only way of giving workers some say.

I have repeatedly tried to get through to the Ministers on the other side that, in fact, better decisions are made when you have input from both sides. It may be that employees would prefer a better benefit plan to higher wages, but the Minister has to recognize that there is a role for unions in the workplace, and for the employees. I do not know why the Minister thinks that he has any right to do this.

There is no financial crisis. We had a surplus with the lapses in the budget of the money that was unspent in the last year. The Minister stood up in Question Period and said that they wanted to achieve a $10 million savings in personnel, and that is why they were bringing in this legislation. The Department of Health and Social Services alone had a $10.9 million lapse. There is $19 million in lapses in the previous year. Why are they doing this? What right do they have to do it? There is not the financial crisis to back it up.

Hon. Mr. Nordling:

We have been over and over those figures, and discussed whether we should take into account the federal situation, or what we should do. Whatever money we have available will be spent. Those lapses will create jobs for people in the territory. I do not think we are out of line to worry about keeping the costs of this government in line.

I do not know if the Member has some figure we should go in the hole before we do anything to control the costs, and before we do something that I think will give our employees some job security and certainty that they will have jobs in the next few years.

Perhaps the Member can tell us if she thinks $10 million or $100 million in the hole would be the time to look at controlling the expense of government.

I do recognize that unions play an important role. They are very valuable, and have been, for workers to get to where they are and get what they deserve. I recognize that, and it is down in section 5 of this bill, where we say that the parties to the PSAC collective agreement may, by agreement in writing, amend any provisions of the collective agreement, other than any in relation to compensation, as defined in subsection 6(1).

If there is anything in that collective agreement that is unfair to the workers - if the working conditions are bad, if they are having problems we can help solve, as an employer - we will certainly work with the unions to do that.

Mr. Penikett:

When the Minister responsible for the Public Service Commission joined the Cabinet of this territorial government earlier this year, he gave reasons that were, in part, fiscal policy for doing so, and he has been a champion of the policies of the government since its election. Would it be fair to say that it is the view of the Minister responsible for the Public Service Commission that the finances of the Yukon government have improved since the Yukon Party took office, and that the finances are better this year than last?

Hon. Mr. Nordling:

Yes, that would be fair to say.

Mr. Penikett:

Could the Minister explain why the Yukon Party government was willing to collective bargain last year, but not this year?

Hon. Mr. Nordling:

Yes, I will try to do that. I was not part of the Yukon Party government last year and I do not know what was behind their thinking.

Last year, management took a two-percent cut in wages. The MLAs took a five-percent cut and their increments were frozen for two years, resulting in a 10-percent savings from the MLAs. Management was reduced two percent. Their increments were frozen. The Yukon Teachers Association recognized that a contribution had to be made and their increments were frozen for the year.

What then happened is that the Yukon Party went into bargaining with the Public Service Alliance of Canada, but the Alliance did not accept or recognize that they had any responsibility whatsoever to make the same contribution that the teachers, managers and MLAs had made.

As a result of that collective bargaining, the per capita contribution made by the Public Service Alliance of Canada was much less than the other employee groups.

My understanding is that the Yukon Party government went into that negotiating process asking for rollbacks, and that is when they were told that if you want a rollback you are going to have to legislate. The decision was made that if we could not negotiate an agreement, then we would legislate.

Page Number 2825

The unions were not willing to come and talk to us about it. They waited until the last minute, but they did have some input that had an effect.

The teachers talked to us and we entered into collective bargaining with them, but those talks broke down because they did not recognize the continuing need.

We are trying to even up the contribution among all employee groups, which we were not able to do through collective bargaining. We are trying to give the employees some job security, leave the government with some certainty about what their expenditures are going to be over the next few years and give the employees some security to know what their wages are going to be over the next few years.

Mr. Penikett:

The Minister would have to admit that there is at least another possible interpretation of the same events. The Minister says they took money or concessions from the managers - this was not negotiated; this was a unilateral decision. They took money from MLAs. As the Minister knows, that was not negotiated in any way and not done anywhere else in any other Parliament in the country - it was a unilateral decision of the government. They took it from the political staff. It was not, as far as I know, a collective bargaining process; it was a unilateral decision. The teachers negotiated a collective agreement and were praised for the way in which they had negotiated. Their reward for doing that was to have collective bargaining done away with.

Disturbance in the gallery

Chair:

Order.

Mr. Penikett:

In terms of the negotiations with the Yukon Employees Union, the Public Service Alliance of Canada, even the government's representative on the conciliation board did not buy the government's financial arguments.

The government's representative on the conciliation board signed a unanimous report. The government's representative understood that this government was in better financial shape than any other government in the country.

The fact of the matter is that this government could not persuade a serious professional negotiator of any financial necessity to take away collective bargaining rights - or, in that case, to do the kind of cuts that were a necessity. The fact of the matter is that what this government has decided is that blacktopping and improving roads is more important than their own employees. The Minister said that if the employees have problems, they can sit down and negotiate. Well, the biggest problem the employees have right now is that this government refuses to go to the negotiating table.

Disturbance in the gallery

Chair:

Order.

Mr. Penikett:

So, unless the government is prepared to deal with that and respond to that by doing the right thing - which is going back to the table - it is pointless to suggest that the union can play a role through some grievance procedure or some other process. The fact of the matter is, I think, there may well be employees in the government who would willingly surrender two percent of their pay if they could be persuaded there was some great, pressing financial need, if there was a debt, if there was a significant deficit or if there was a realistic prospect of that being the situation in the near future, but, they would only do it willingly if it was a negotiated arrangement.

The Minister talks about employees being concerned about job security. I can tell the Minister from some personal knowledge in this, that there are plenty of places in this country and elsewhere in the world, where, in the time of a declining economy - and let us admit the Yukon economy is in rough shape right now; we are not in 10 years of prosperity, there is every indication we are in the opposite - public employees have been willing to sit down and negotiate contracts with no increases or other arrangements, but there has to be something on the other side of the ledger. There have been agreements signed in Canada with no cut, no layoff, no downsizing, no privatizing, no contracting out provisions - in exchange for the public sector recognizing some harsh financial realities, if they exist.

But, in every one of those cases where there are amicable arrangements, they have been negotiated. Notwithstanding the $20 million they found the other day and the $22 million we were talking about earlier tonight, which is booked and affects their balance sheet but which is reserved for obviously no immediately useful purpose, if the government were genuinely persuaded of this financial crisis, if they genuinely, in their heart of hearts, believed it, and if they were also, as they genuinely claim to be, - or the Government Leader claimed last year to be - committed to recognizing the rights of working people and collective bargaining, they would sit down at the table and negotiate it.

The Minister cannot just quote, out of context, a couple of statements by leaders of the employees' union and then say that, on that basis, they made a certain political decision, because that is to ignore the realities in the context of collective bargaining, which is to sit down at the table, employer and employee, and hammer something out.

The Minister may be shocked and appalled to know this, but some quite awful things were said about Tony Penikett during the times when the public sector employees were negotiating with the previous government. As sensitive a flower as I am, it did not prevent me from doing the right thing by the employees, which was sitting down, dealing with making agreements, sitting at the table, respecting their rights to say those awful things about me, and still do my job, which was to respect their rights and negotiate within the context of the economic circumstances of the day. Of course, the economic circumstances were much better then, and they were able to get a much better agreement, but I am sure the employees would recognize how awful the economy is under the present government and would negotiate accordingly if the Minister went to the table.

Hon. Mr. Nordling:

I agree with the Leader of the Official Opposition. There is more than one side to an issue, and more than one way that what happened last year can be interpreted. It is clear to me that last year, in spite of the fact that there was a financial crisis recognized - and I think that a conciliator did accept the financial position of the government - the union was not prepared to talk about cuts. That is when the union said that they would not. They said it would be the government's responsibility. They did not want the responsibility to go into a negotiation and negotiate rollbacks because that is not what unions are for.

The union executive speaks for the membership of the union. I took what they said at face value, and I still believe that it is true that they would not be prepared, despite the financial crisis, to negotiate rollbacks.

I do not know. Perhaps the Leader of the Official Opposition, who has the ear of the unions, could tell us what sort of financial shape we would have to be in to convince the union to roll back wages two percent.

Mr. Penikett:

The issue now is different. The issue now is how big a surplus does this government have to have before the democratic rights of its employees will be restored. Interestingly enough, in a long debate with the Government Leader yesterday, he would not tell me. In fact, we were led to conclude that collective bargaining, as a democratic right, is now a hypothetical situation.

Let me ask the Minister this: is he not willing to admit that the government's representative on the conciliation board last year, in respect to the contract with the Yukon government employees, did

Page Number 2826

not accept the government's arguments about the financial situation and, in fact, signed a unanimous report? Is that not the case?

Hon. Mr. Nordling:

I do not know what the Leader of the Official Opposition is asking me. I do not know whether I should say yes that is not the case, or no, that is not the case, or it might be the case.

I do not know exactly what the opinion or position was of the conciliator the Yukon government appointed. The only thing I know is that the conciliator, appointed by the government, signed the report, and that report was accepted by the Yukon government at that time.

Ms. Moorcroft:

I can tell the Minister one thing about the conciliator's report, and that is that the Government Leader said he accepted the conciliator's report, but now the government has turned around and brought in wage restraint legislation.

The Minister said that they had to bring in this wage restraint legislation and that Jim Brohman told them that, if they wanted rollbacks, they would have to legislate it.

I wonder, if Jim Brohman told them to pull this legislation, would that mean the Minister would pull it? Somehow, I doubt it.

I would like to ask the Minister about his own comments. I am not going to go back and ask him about the conciliator's report, but I want to ask him about some of the things that he has had to say, both in this House, and in letters he has written to Members of the Legislature and to both teachers and government employees.

On April 18, when we opened this session, the Minister said that it was not the government's intention to dictatorially impose a wage settlement on either the Yukon Teachers Association or the Government Employees Union, and that they were prepared to meet and negotiate, which they have not done.

The Minister has also written that the government required a financial certainty that could only be achieved if it knew in advance what its savings to the payroll would be. Do tell me what the financial certainty is that he thinks he has? The roller-coaster in this budget of deficits and surpluses and projections and lapses reminds me of a game my kids play where they can devise a roller-coaster on the computer and then get on the car, run it and see if it will work. I do not think this government's budgets would work. I think it is a roller-coaster that just would not make it through.

I would like to ask him what evidence they have that they can project things in advance, as they say they want to do with this restraint legislation.

Hon. Mr. Nordling:

The Member, and all the Members on that side, know that it is impossible to predict the future. We have heard from the Member for McIntyre-Takhini, when he was negotiating the agreement, how difficult that was to predict, but it has to be done by governments.

The Member for McIntyre-Takhini talked about the inflation rate being 6.6 percent in the first year, and he thought that seven percent and six percent in the next two years would be fine. He never expected John Crow to tighten the screws and bring inflation down to under one percent, but that settlement carried on and those predictions were lived with, and we have to do that, unless the Member is saying that we should never take any action, that we should not be proactive whatsoever, but what we should do is react. The question then is when do we react - how long after the event?

I remember talking to someone on the street about the federal deficit and how it was over $500 billion at that time. The person said to me, "Gee, you would have thought some alarm bells would have gone off when it hit $100 million." That is the sort of thing we are dealing with. We have to predict and estimate for the future. I do not think the Member for Mount Lorne expects that, as a government, we should be - or she would be, if she were in the government - strictly reactive.

Ms. Moorcroft:

Why is the Minister trying to characterize this legislation as proactive? It is not proactive. It is dictatorial, and it is autocratic.

The Minister sat down there on April 18, and he wrote a letter to one of the Members of this Legislature, saying "had the government entered into collective bargaining with the reserved intention of legislating an agreement it could not obtain at the bargaining table, the government would indeed be opening itself to a charge of bad-faith bargaining."

Indeed, it certainly is. The charge of bad-faith bargaining has been made - let there be no doubt about that.

The Minister goes on to write that "such an option would be as unacceptable to the government as it would be to the Yukon Teachers Association, since it would be treating the bargaining process as a sham.".On that very day, no sooner did he get finished signing that letter than he comes into the Legislature and says they are prepared to meet and negotiate until May 20 and, if they cannot achieve an agreement by that time, then they, as a government, are prepared to introduce wage restraint legislation.

What kind of bargaining is that?

What did the Minister mean by writing that it would be a charge of bad-faith bargaining and that it would be unacceptable to the government and, then, turn around and do exactly that?

Hon. Mr. Nordling:

We can go over this ground again, if the Member wants, as many times as she would like. When we announced that we had proposed wage restraint legislation, our intention was to let the Teachers Association, the PSAC, and the management, know what our intentions were, so they would be able to discuss with us, in context, what we hoped to achieve in payroll savings. Through that, the teachers would know that they would not end up in the same position that they were in last year, where they negotiated in good faith and ended up paying a higher price per capita than other government employees. We wanted the teachers to know that, if we went to the bargaining table and bargained, they would not end up with that, and that we were prepared to legislate, with respect to PSAC, so that the personnel savings would be more even across employee groups, and that there would not be one group paying a lot larger share of the burden than another group.

Ms. Moorcroft:

I just cannot believe the inconsistencies that we get from this government and, in particular, from this Minister. We have a Government Leader who writes a pleading letter to the Minister of Natural Resources, asking them not to cut the funding to the forestry cooperation agreement, that if it is subject to budget cutting, it will not be able to remain an effective tool. I think the Minister should recognize that treating their employees in this manner makes it impossible for the government workforce to be effective. When the Minister does not have any respect for his workers, then he has to know that the workers will not have any respect for him, either.

The government said that budget cuts at this time send a signal that governments lack confidence in the business community and the economy. Then, this Minister stands up here, right now, and says that we have to have these cuts. Does he not think that is a signal of lacking confidence in the economy and lacking confidence in the business community and, in particular, lacking confidence in the employees?

Hon. Mr. Nordling:

No, not at all. I think that this shows some responsibility on our part; it shows some confidence. These two-percent rollbacks do not freeze increments.

For example, a teacher with five years' experience can look at their wages increasing 10 percent over the next three years. That is not bad. We are confident that we can maintain control over

Page Number 2827

government expenditures and that we can stay in better financial shape than any other jurisdiction.

I have the greatest of respect for Yukon government employees. This bill is not a comment on how I feel about our employees and whether they do their job and how they carry out their job; it is a comment on my concern about the fiscal realities that we face in the Yukon and in Canada as a country. We have to be responsible so that we do not end up like other jurisdictions, and it can be done with a small sacrifice by all of our employees.

Through this legislation we hope to be able to keep every government employee working and not lay them off. I think that is a comment about how concerned I am about every employee. I am not prepared to sacrifice some of our employees so that others can get paid a lot more than they are getting paid now.

Ms. Moorcroft:

Now, we really have some nonsense. The Minister talks about this being a measure of responsibility and of confidence that they are showing. I do not get that. I do not understand what he is saying - in particular, when it is in direct contradiction to the comments made by the Government Leader and the Minister of Renewable Resources, requesting the federal government to provide vision and direction to his department to ensure that funding cuts of this nature do not occur in future.

Why is it one thing for the government to plead with the federal government to show vision and direction by not cutting funding and, then, turn around and say that they are showing responsibility and vision and giving good direction by making funding cuts, and making those funding cuts by overriding a democratic right? It is not a small sacrifice to just override the right to collective bargaining.

Hon. Mr. Nordling:

It is unfortunate that, as a government, we have a responsibility that goes beyond our employees. We have one of the highest unemployment rates in Canada here in the Yukon, and we have a responsibility to put other people to work. We have a responsibility to create jobs. We have a responsibility in the area of economic development, and we hope that, by maintaining or convincing the federal government to fund us at the same level we have, we will be able to deal with unemployment, and we will be able to provide social services to all Yukoners - Yukoners who need them.

Our government employees do not go home hungry at night. They have jobs, and none of them have to subsidize their income with social assistance. As a government, we have a responsibility for all Yukoners.

Mr. McDonald:

The government has a balancing act. So what? So what is new? Governments have had to undertake balancing acts for years and years and years. So what is new? So, the government has to make tough choices about putting money into social assistance versus putting money into capital projects. So what is new?

The Minister has said on a couple of occasions this evening that there is a financial crisis to address. There is no financial crisis to address.

Disturbance in the gallery

Chair:

Order.

Mr. McDonald:

The Minister is asking where I live. I live in this territory and I have been in this Legislature every day for the last month and a half. During that period, we have seen a government claim that it has a financial crisis when it has no such thing - it is sitting on a surplus budget. What does the Minister define as a financial crisis? He is expecting - we are all expecting - the revenues from the federal government to remain static over the next few years, and the federal Minister of Finance has already said that he expects that the settlements that we achieve on formula financing arrangements should stay at the same level or decrease. So, we know that we can achieve - with some imagination - the same level in those negotiations. We know that this government is sitting on an accumulated surplus. We know - because it has already been established and has already been issued from the Minister of Finance's own mouth - that that accumulated surplus will grow this year because there will be lapsed funding.

We know that that could be anywhere from $10 million to $25 million - in addition to the accumulated surplus upon which the government currently rests.

At the same time, this Minister makes the unsustainable argument that somehow their financial projections, three years from now, will put us in a $1 million deficit position on annual expenditures. That is not taking into account that the government is going to be building surpluses during that whole period. If it continues in the way it is going, in three years from now, we are going to be sitting on a $30 million to $40 million accumulated surplus, which can easily handle an annual deficit of $1 million - if we are going to show any respect at all for the kind of precision predictions that the government pretends to want to make.

I agree with the Minister that governments should be projecting what their costs will be; they should be planning ahead. They should be trying to anticipate what their revenues are going to be. They should be trying to anticipate what their expenditures are going to be. That would be sound financial management - that would be one element of it. For the government to pretend that it can behave with such precision, and that it is going to be just over $1 million out on its annual expenditures in 1996-97 is ludicrous, particularly when, only 12 months ago, we said that we were going to be spending, last year, $39 million more than we spent. These figures I am using are figures that were bequeathed to us by the Finance Minister in the last few days.

Now, this $20 million surplus was mostly unexpected. The Minister admits that. We have always been anticipating that there would be a $4 million to $5 million net surplus. Yet, it has turned out to be $20 million. There was $15 million of net discretionary money available to the Yukon government only a couple of weeks ago. Only two weeks ago. It was completely unknown, but now, suddenly, it is a big surprise. Despite the Minister's claim that this is somehow a result of increased efficiencies - a claim that they have not been able to sustain in debate in this Legislature - only underscores the point that to pretend you can project expenditures three years - I am trying to make this point if the Minister will let me - into the future is absolutely ludicrous.

I have much more to say, but the Minister is dying to get in the last word. I will let him have it. After you, Alphonse.

Hon. Mr. Nordling:

I have the Member's point. It is absolutely ludicrous to pretend that we can predict what we are going to have three years from now to within a million dollars. What we are talking about is the direction that we are headed in. This Yukon government, not that many years ago, was sitting on a $90 million accumulated surplus. What this government wanted to do was stimulate the economy, do away with unemployment, and we spent the surplus. We spent more and more, and within a few years we ended up with a $13 million accumulated deficit. Or, for the sake of argument, I will say that we just spent the $90 million - forget the deficit.

What I am talking about is the direction we are headed in. As I quoted the old Chinese proverb, if we continue in the direction we are headed, we will likely end up there. That is what is happening with the Yukon government.

Chair:

Order.

Hon. Mr. Nordling:

We have increased the size of government, the personnel expenditures in government; we have increased services -

Chair:

Order please.

In view of the time, I will now rise and report progress.

Page Number 2828

Speaker resumes the Chair

Speaker:

I will now call the House to order.

May the House have a report from the Chair of Committee of the Whole?

Mr. Abel:

The Committee of the Whole has considered Bill No. 15, entitled Second Appropriation Act, 1994-95, and Bill No. 94, entitled Public Sector Compensation Restraint Act, 1994, and I report progress on them.

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.

In view of the time, this House now stands adjourned until 1:30 p.m. tomorrow.

The House adjourned at 9:33 p.m.

The following Legislative Return was tabled June 1, 1994:

94-1-359

Social service programs investigator: mandate; policy and procedures followed for investigations; appeal process (Phelps)

Written Question No. 51, dated May 19, 1994, by Ms. Moorcroft