Whitehorse, Yukon

Monday, January 16, 1995 - 1:30 p.m.

Speaker: I will now call the House to order. At this time, we will proceed with silent Prayers.



Speaker: At this time, we will proceed with the Order Paper.

Introduction of Visitors.

Are there any Returns or Documents for tabling?


Hon. Mr. Phillips: I have a document for tabling.

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?


Mr. Cable: I have a number of motions. The first is

THAT this House urge the government to table a detailed policy relating to the core funding of non-government organizations providing services to the public.

The second is

THAT this House urge the Government of Yukon to introduce legislation that will provide for the creation of planning bodies, with the ability to prepare plans of a local area nature that include areas both inside and outside the municipal boundaries so as to give the residents of these areas a statutory right to participate in the planning of their area over any problems and conflicts such as those that have arisen over the Stevens subdivision and gravel pit in the City of Whitehorse.

Last, but not least:

THAT it is the opinion of this House that the encouragement of the expansion of legalized gambling by the government does not serve to improve Yukoners' quality of life.

Speaker: Statements by Ministers.

This then brings us to the Question Period.


Question re: Gambling

Mr. McDonald: I have a question for the Government Leader. The government has announced that it intends to proceed with a gambling casino in Whitehorse, even though a very large percentage of the population appears to oppose it outright, and most of the remainder are profoundly ambivalent about whether or not it should be supported. In listening to the Government Leader's answers in the Legislature, and in speaking to many people, I am having a lot of trouble finding people who will give it their unqualified support. Can the Minister tell us who those people might be?

Hon. Mr. Ostashek: As I said in the House last week, the issue is one that is very emotional and one that the public seems divided on at this point. That was even reflected in the Council on the Economy and the Environment report; but there seems to be some support for a casino that would be operated by a non-profit group.

Mr. McDonald: I think it is telling that the Minister cannot name one group that has identified a casino as a worthwhile project. The Yukon Council on the Economy and the Environment said that, before the decision is made to proceed with gaming or expanded gaming, some policies have to be established, such as the involvement of First Nations, the financial commitment to address social problems, objectives to be accomplished, the ownership-management-operation profit distribution. Are these policies in place?

Hon. Mr. Ostashek: We are fully aware of what the report said and those are issues that we will be dealing with, as I told the Members last week. We have an internal committee working now on the options available and what has to be done, and what further consultation should take place. The throne speech set out in principal that we agreed with it. We know there is a lot of work to do on it yet and we said we are going to move very slowly.

Mr. McDonald: The government's throne speech indicated it will proceed with a casino. It does say that and I will read the throne speech for the Minister: "In order to further enhance tourism, my government has agreed in principal with the construction of a tourist-oriented gambling casino in Whitehorse.'' So, they have agreed in principal to proceed with a casino.

In terms of the details to be worked out, the YCEE suggests clearly that certain policies should be developed before any proposals would be evaluated, and yet the government has already said they will be calling for proposals shortly. How are they going to evaluate proposals if they have not established the policies?

Hon. Mr. Ostashek: We will be establishing the policy. We will be entering into discussions with different interest groups. The policy will be established before it goes out for proposals.

Question re: Gambling

Mr. McDonald: I have to wonder why the government has decided to proceed without having any details established. I am hearing more and more concerns from particularly people in the business community that the expansion of gaming activity in Whitehorse, in the form of a big new casino, would be bad for business. They have suggested to me that any economic benefits in favour of the casino, such as jobs, would be offset, or lost, in the small business service sector. They will see people's discretionary income drop.

Can the Minister tell us whether or not he feels that the small business community, particularly in the service sector, deserves this kind of treatment from the government?

Hon. Mr. Ostashek: First of all, I would like to make it clear to the Member opposite that, since the announcement in the throne speech, we have not heard many anxious remarks either for or against the casino...

Some Hon. Member: (Inaudible)

Hon. Mr. Ostashek: ...except for those raised in the Legislature - the Leader of the Official Opposition is exactly right. Certainly, we are concerned about how the business community views the issue. Some of them see it as a bonus; others may not. We will be reviewing all of that.

Mr. McDonald: I would like to know why the government has decided to proceed with a gambling casino, when even business organizations such as the Tourism Industry Association had a two-hour long debate on the subject of increased gambling. This project is ostensibly directed toward them, and yet they could not even come to a decision on this issue among themselves, because they realized that a lot of discretionary income would be drawn from their stores and their small businesses to the big casino. They wonder whether or not this is just another form of tax revenue for the government, with no great benefit to the territorial economy.

Is the government intending to extract revenue from the casino?

Hon. Mr. Ostashek: We have said that revenues are not our concern in this matter. To begin with, the issue regarding casinos and the running of VLTs was raised by the public - the hotel association, for example, on VLTs. We went to the Council on the Economy and the Environment to find out what kind of support was out there and found out that there is some soft support for a tourist-oriented casino. The Member says that the Tourism Industry Association had an intense debate about it. However, I would draw the Member's attention to the fact that that is one group that put forward a proposal before there was even a call for proposals.

Mr. McDonald: At the TIA convention, at which I was present, particularly during this debate, many of them indicated quite voiciferously that they were extremely concerned about the impact of this casino, but they felt, as did the Council on the Economy and the Environment, that if it should proceed, it should be controlled. They were not passing judgment on whether or not it should proceed. In fact, there was extreme ambivalence about that.

Can the Minister tell us why it would make the decision to proceed, knowing that there are concerns from the business community, knowing that people are concerned about the social costs, and knowing that, as he puts it, that there is soft support? I would think that there is actually very, very soft support for this casino.

Hon. Mr. Ostashek: I guess we looked at it from several points of view. To begin with, the point of view of the Cabinet was that there should be some controls in place. We know that the First Nations are also divided in their opinions about the issue because of land claims settlements. Some First Nations support putting casinos on their land and some do not. We thought that if we could get all of the players together and put in place a process that would control unlimited expansion of gambling in the Yukon, it would be in the best interests of all Yukoners.

Question re: Northwestel rate increase application

Mr. Cable: I have some questions for the Minister of Community and Transportation Services relating to Northwestel's current rate rebalancing application before the CRTC.

A few weeks ago, the Minister was quoted on the radio as saying he questions Northwestel's motives. Could he elaborate? What does he think Northwestel is going to do with this application?

Hon. Mr. Brewster: I think they are simply trying to put it through too fast. The tremendous increase that rural people will pay for telephones should, I think, be taken out over a longer period of time that the people could handle - maybe two to three years or something like that. The increase in cost is going to be very substantial for First Nations people and people like that, where most of their phone calls are local. Regardless of what anybody says, they are not long distance; they are local or within the Yukon area.

Mr. Cable: The Minister has probably answered my next question in part, but could he indicate to the House what the substance of the Yukon government intervention is in this application?

Hon. Mr. Brewster: I am not prepared to give that out until we present it to the CRTC. I am not prepared to give out any information that might help them in their rate application.

Mr. Cable: At some juncture the intervention has to be filed and we will all see it, so we will just keep our fingers crossed.

Let me ask this question: will the government be asking the CRTC to conduct a full public hearing on the matter?

Hon. Mr. Brewster: I am not at all prepared to say what we are doing. Everybody will see it when it is before the CRTC, but I am not prepared to give that information out ahead of time.

Question re: Gambling

Ms. Commodore: My questions are for the Government Leader in regard to the gambling casino.

We found out from the Government Leader in Thursday's debate that they have not consulted with Yukon people, including Kwanlin Dun, that they have no intention of putting up funding for the construction of a gambling casino and that they have a subcommittee of Cabinet, which has not met for months, to look at the gambling issue. The Government Leader has no idea who is on the subcommittee. The Government Leader stated that one of the reasons for pursuing the casino is because they are "concerned that they not have a proliferation of casinos across the Yukon." I would like to ask the Government Leader what led him to believe that that might occur?

Hon. Mr. Ostashek: If I could go back to the early days when the discussions first arose, one of those was raised by a First Nation band coming in to talk to us about how we felt about casinos in the Yukon.

Ms. Commodore: The Government Leader also stated on Thursday that he was going to be consulting further. I am not sure who he has consulted with already. Since this is a very controversial issue, when and how does he intend to do that?

Hon. Mr. Ostashek: I did say that last Thursday. We will be consulting further, and I hope that, within a very short time, we can lay out the methods that we will be using.

Ms. Commodore: That is very encouraging.

Since most people, including Kwanlin Dun, believe that this casino will be built on the waterfront, does he intend to meet with Kwanlin Dun to further discuss the issue, or does he believe that the CYI speaks for the Yukon First Nations?

Hon. Mr. Ostashek: First of all, I never said it was going to be built on the waterfront. There are a lot of things that people believe that do not have any basis to them. We have had some preliminary discussions with CYI, and we will have further discussions with them as soon as they have the time available to enter those discussions.

Question re: Gambling

Ms. Commodore: In the report from the Yukon Council on the Economy and the Environment, the consensus was that, if the government decides to proceed with the expanded gambling casino, it should take into consideration that Yukon First Nations should have equal involvement regarding the policies, legislation and regulations that give effect to a gambling casino. Since the government has already decided to proceed with a gambling casino, can the Government Leader tell us if that recommendation has been discussed with CYI or other First Nations?

Hon. Mr. Ostashek: Quite clearly, I said that we have had a couple of meetings with CYI officials, and we are now talking about that specific recommendation. That is exactly what we are talking about. I do not think that we want to end up in the same situation as exists in British Columbia, Saskatchewan and other jurisdictions across this country. That is something we are trying to avoid.

Ms. Commodore: We will find out exactly what he said to First Nations people. I am sure it did not include that. The Government Leader also indicated that he had a Cabinet subcommittee in place, which he believed was still in place, to deal with the casino issue, and that all information, such as the reports and studies from other jurisdictions, is being funneled to it. The subcommittee is then to do the analysis and pass it on to Cabinet. Can the Government Leader tell us how active this Cabinet subcommittee is and when we can expect a report from it?

Hon. Mr. Ostashek: The Cabinet subcommittee is a subcommittee of the Cabinet Committee on Social Issues. For a couple of years now, they have been gathering information on the impacts of gambling - the pros and cons of it - and all that information is available and is being discussed internally with the various departments that are putting together the proposals to determine where to go on the casino issue from here.

Ms. Commodore: The government has just indicated that departments were looking at the research and analysis from different reports and studies that have been undertaken in other jurisdictions. I would like to ask the Minister to tell us which departments these are, how many person years are being used to bring this information back to the Cabinet sub-committee and also who is on that subcommittee - because he did not know on Thursday.

Hon. Mr. Ostashek: I will get that information for the Member and table it in the Legislature.

Question re: Gambling

Mr. McDonald: It is quite fascinating to note that this is the most studied project undertaken by the Yukon Party government in its two-year history. There is more analysis applied to whether or not there should be a casino and how it should be run than on any other thing they have done, bar none.

We still have all the basic questions outstanding, yet we have a decision to proceed with a gambling casino in Whitehorse.

Given that the Yukon Council on the Economy and the Environment indicated it felt that First Nations should have some involvement regarding policies and regulations of gambling activity, and given that this gambling casino will be placed in Whitehorse, can the Minister tell us why he has not had people discuss with Kwanlin Dun this specific gambling casino proposal, before they made the decision to proceed in principle?

Hon. Mr. Ostashek: We are proceeding slowly with this. We said all along that we would. It is a very emotional issue for the public. If we had not come out and said one thing or another, we would have been hammered by the Opposition for sitting on the Yukon Council on the Economy and the Environment report and not putting something out publicly.

So, we publicly released what we thought was appropriate. The reason we have not gone to Kwanlin Dun yet is because there are a lot of other bridges that have to be crossed first. As the Member opposite is aware, the First Nations have had several meetings on this, and they are as split on the issue as the rest of the community.

Mr. McDonald: When the Government Leader says the community is split, I would point out to him that in the YCEE report they say that, of the people they spoke to, 73 percent indicated their opposition and 23 percent supported the expansion of casino gambling in the Yukon. When we are talking about a split opinion, we are talking about it being very heavily weighted in one direction.

Given that the YCEE report did indicate that certain things had to be done prior to a decision in principle being made, can the Minister tell us why they proceeded to make the commitment to have the casino built in Whitehorse prior to doing any of the basic policy work or answering any of the basic questions?

Hon. Mr. Ostashek: I do not recall reading it in the report. It had to be done prior to a commitment in principle being made. I believe we made the commitment in principle and now we will go through the process to see if it is viable and whether there is enough support for it to go ahead.

I just want to say that we just had a municipal election in town here where five out of seven elected people said they supported some form of expanded casino gambling in Whitehorse.

Mr. McDonald: Like everyone else who has expressed an opinion that I can identify - and I have asked the Minister to identify people who have provided unqualified support - they have said that if the casino project should go ahead, it should be controlled. They are not saying that the casino project should go ahead. That is something the Minister is reading into the comments.

Can I ask the Minister this: why is the government calling for proposals from people who are interested in pursuing the construction of a gambling casino in Whitehorse when all the basic policy work about how one might evaluate those proposals just has not been done?

Hon. Mr. Ostashek: Quite clearly, we have not called for proposals yet. I told the Member earlier that we are developing the policy, and that it will be done prior to proposals being called.

Question re: Gambling

Mr. McDonald: We get the impression that all these things are right around the corner because the Minister, depending on the day, gives us to believe that the construction is going to happen immediately, yet nothing at all of any consequence has been done, other than that they have agreed to proceed with a casino. Whatever consultation they are going to do obviously has nothing to do with whether or not they are going to have a casino, because they have made that decision.

There are a large number of non-profit groups that are, to say the least, a little hot about this decision because they see their revenues from existing activities, such as bingos and raffles, drying up. The Minister has said that what they are going to do to respond to this obvious concern is to consider proposals to share revenues from the gambling casino managers.

Given that it is virtually impossible to meet the emerging needs of a non-profit sector through some sort of resource-revenue sharing, why would the government not take into account the concerns of the non-profit sector and have their concerns allayed before making a decision?

Hon. Mr. Ostashek: Again the Member opposite me is making assumptions. I said that was one of the possibilities. We looked at what is being done in other jurisdictions, and that is the model that is used in Saskatchewan, which I felt had some merit and that could be investigated with the non-profit groups in the Yukon.

Mr. McDonald: This is not a light matter. I just had a meeting with some non-profit groups who wanted to know what they could do to take the government down on this subject, because they see their whole future dwindling before their eyes. This seems like another Division Mountain coal project - we have none of the details, yet the decision to proceed is made. Can the Minister tell me this: the Klondike Visitors Association is concerned, given that they have a unique attraction in Dawson. What is the government going to do to make up for the fact that they will no longer have a unique Yukon attraction, as a result of the gambling casino in Whitehorse?

Hon. Mr. Ostashek: The Member is raising these alarms in the Legislature. We hear of all these groups who are totally against this and that may be, but I say to the Member opposite that we have not received any representation from these groups directly, since we made the decision in principle.

Mr. McDonald: My job is to raise alarms and I am doing that. When they ask me to ask a question, I will ask a question of the Minister. The Minister has indicated that these people have not raised concerns directly with him. Is he going to take that as a representation that these people's concerns are not useful or not important? How is he going to respond to their needs?

Hon. Mr. Ostashek: Certainly that is not the position we are taking, and we said that there would be further consultation. We have said that and we fully mean that.

Question re: Gambling

Mrs. Firth: I, too, have a question for the Government Leader with respect to the gambling issue. Today we heard the Government Leader say that they do not have a policy established before the proposal is going out. They are still reviewing it. They have to review the method of consultation. They have got some soft support for gambling. They cannot tell us who wants it, yet they have made the announcement in their budget and in their throne speech that they support a gambling casino going ahead.

Aside from what my personal feelings about this may be, I am not here to represent my personal feelings and support for this project or non-support. I am here to represent what Yukoners want.

When the Minister speaks of consultation, I would like to have him stand up and tell us today how he is going to consult with Yukoners with respect to the gambling issue.

Hon. Mr. Ostashek: I said this in debate the other day, and I believe I said it again today. The departments are working on putting together a process that will facilitate consultation with Yukoners. As soon as that is in place, I will be announcing it to the Legislature and to the people of the Yukon. It is something that is being worked on right now.

Mrs. Firth: The outstanding question that remains is this: who wants it? Yukoners have never been asked that question. When I discuss this issue with my constituents, they are very concerned because it is a very major social issue. I have not seen a position put forward by the Chamber of Commerce or by non-profit groups, or anyone else, except the two groups that were identified in the report, which were the Federation of Labour and the Council for Yukon Indians. I would like to ask the Government Leader this: in the examinations that are being done by the departments, is there any consideration being given to a referendum or a survey to ask Yukoners whether they are even interested in having gambling casinos, or to have gambling expanded in the Yukon? Why do we not ask the people?

Hon. Mr. Ostashek: That is one of the issues that we are dealing with right now. The Member says that there has not been a position put forward by any organizations, but that is not the case. When you say casino gambling, the people of the Yukon visualize a Las Vegas-style casino. That is not what we are talking about. We are not talking about a casino that exists to make a profit, and we have said that quite clearly. In their representations, the Chamber of Commerce and those other organizations stated quite publicly that they were divided on the issue. The level of support for it depends on which approach we decide to take on it. The Council on the Economy and the Environment indicated that it felt that a part-time, tourist-oriented casino run by a non-profit organization would have considerable support.

Mrs. Firth: These people are responding because of the announcement that the government made that there is going to be a casino. It was announced that there is going to be a casino here, so everyone feels that they have to respond to that, and fit their purposes to that. Will the government consider going to the people to ask them if they even want to do this? The issue is not what the government wants to do, or what I want to do, but what the people want. I think that a referendum or a survey could be done at a minimal cost; we do not have to spend a lot of money. Let us seek some opinions from Yukoners about this issue. Is the Government Leader prepared to do that?

Hon. Mr. Ostashek: I agree with the Member opposite. We are prepared for some public consultation. The exact approach - whether it will be a referendum or a poll - and what the questions will be are yet to be decided. Our officials are working on this whole process now. I agree with the Member.

This issue arose not from a desire within Cabinet, but from representations made to Cabinet on VLTs and casinos.

Question re: Human Rights Tribunal decision, appeal by government

Mr. Penikett: On Thursday, when I asked the government about the Canadian Human Rights Tribunal decision in the Harbans Randhawa case, the Minister said that he did not have the facts of the matter. On Friday, he told the media the government was appealing the case in order to buy time. Could I ask the Minister of Justice which of those two statements was true?

Hon. Mr. Phillips: The case was brought before myself in mid-December. Through discussions, I was told that the time to appeal was running out. There was a ruling made, but there were no reasons for the ruling. As has been done by the previous government and other governments, when it does not have the reasons for the ruling, and it wants to have the opportunity to look at it, it files a notice of appeal to give itself more time. That is what happened.

I did not recall it, at the time, because it was not a serious issue. We were not actually appealing the case. We were not dealing with it, other than the fact that if we are to consider an appeal, we need more time. That is why I did not recall it, at the time.

Mr. Penikett: This is incredible. The Minister said he made a decision in December, which he did not remember in January, on the most important human rights case that has ever gone before the Canadian Human Rights Commission in this jurisdiction.

I want to ask the Minister a direct question: did he made the decision to appeal the case, or did someone else?

Hon. Mr. Phillips: We should remember that all the human rights allegations took place under the previous administration. That Member was the leader of the government when all these accusations took place. It was another one of these things that we were left with.

The time was running out on the ruling, which had said that Mr. Randhawa was correct. We had no reasons for the ruling. I understand that, up until last week, we still had not received the reasons. We were either to accept it completely, without any ifs, ands, or buts, or we were to wait until we received the reasons. The only way we could wait to get the reasons was to file a notice of appeal, look at the reasons and, then, decide whether or not we were going to appeal.

Mr. Penikett: The record will show the Minister has answered neither of my questions. He made two contradictory statements. On Thursday, he said one thing; on Friday, he said something else. He has not told us which of those two statements is true.

Now he said he made the decision, but, last week he could not remember making the decision on this important case.

Now that the Minister has been apprised of the facts by his officials, will the Minister be withdrawing the government's appeal on this racial harassment case?

Hon. Mr. Phillips: I am going to wait to see what the reasons are on this racial harassment case, which happened under that Member's administration, before I make a decision and commit the Government of the Yukon. I am not familiar with all the details of the case. We are not even familiar with the reasons for ruling in Mr. Randhawa's favour.

I do not think the government should act in that manner until we have an opportunity to see the reasons for the ruling.

Question re: Human Rights Tribunal decision, appeal by government

Mr. Penikett: I happen to have received documents on the matter. They make the reasons for the ruling very clear; the tribunal ruled against the government, recommended compensation for damages and for lost wages, and recommended a promotion for the individual who suffered the harassment.

Why does not the Minister of Justice and the Public Service Commission immediately make themselves aware of the facts so he can take action to correct the situation, instead of launching an appeal to buy time?

Hon. Mr. Phillips: I have been advised by our officials that we do not have the official reasons from the Human Rights Commission. If that Member has the reasons, perhaps he could table them. If that is the document we are looking for, I will make it available to our officials and we will look into it.

Mr. Penikett: I would like to ask the Minister a direct question to see if I can get a direct answer.

Is the Minister saying that he does not have the documents from the Human Rights Tribunal, dated November 3, 1994, which lay out the decision of the tribunal and the recommendations to the government?

Hon. Mr. Phillips: I do not have the document with me. I also do not have the reasons for the decision. We need the reasons for the decision made by the Human Rights Tribunal. That is the advice I have been given by the officials. I will ask the officials to deal with it very quickly, once we receive the reasons.

Mr. Penikett: What will become an issue in this House, no doubt, is the real reasons for the government's decision to appeal. I want to ask the Minister this direct question, since he said he made his somewhat injudicious remark to the media and to the House today: does this Minister seriously suggest, in his previous comment, that the NDP Cabinet, which legislated the Human Rights Act in the face of hysterical opposition from the Member opposite, actually condoned racial harassment in the workplace while we were in government? Does he seriously suggest that?

Hon. Mr. Phillips: No, I am not suggesting that, but the ruling of the Human Rights Commission is that it happened under that administration. We are looking into the matter. Once I receive the reasons for the decision, we will be making a decision on it. But, no, I do not think any government should condone that type of action.

Question re: Special operating agencies

Mr. Cable: During the last election, the government talked about efficient delivery of services to the public. I have some questions for the Minister of Government Services relating to the special operating agencies that were referred to in the Speech from the Throne. As I see it, the initial three agencies are agencies providing services within government. In view of this government's attitude toward improving efficiency of delivery of services to the public, why were agencies that deliver services to the public not chosen, rather than inter-departmental agencies?

Hon. Mr. Nordling: We looked at different areas of the government that could be chosen and in which it could possibly be done. We looked at departments that most closely fit what we had researched and found to be successful in other jurisdictions. We looked at the federal government-implemented SOAs. One of the successful SOAs that we had researched was the Manitoba fleet vehicle service. We took the ones that most closely fit the criteria to be a SOA, to operate semi-independently, and then addressed it with those departments. We had to find departments that were willing to take on the responsibility of changing their way of thinking. It happened to be the three within Government Services that were most ready to go and best fit the basic criteria.

Mr. Cable: It would be useful for the Minister to table those terms of reference, so we can see how they relate to what he is doing.

Is it the government's intention to, eventually, move the standard operating agency concept into departments that deal directly with the public, such as the land titles office?

Hon. Mr. Nordling: Yes, that is quite possible. If the special operating agencies improve efficiency and are cost effective, we will move into those other areas; however, we want to see how successful we can be in our own house, to begin with.

Mr. Cable: In December, at the briefing that the Minister was good enough to give some of the Opposition Members, it was indicated that the concept had been put out to the union for review. Has the Minister received the union's reaction? If so, what was it?

Hon. Mr. Nordling: I have not been made aware of any specific concerns. I know that it was discussed with the union. There was concern about whether or not it was privatization or downsizing. It is not that. The union is prepared to wait and see exactly what we are doing. I think that they will react if it adversely affects them at any stage.

Question re: Watson Lake transition home

Ms. Commodore:
My question is for the Minister of Health and Social Services. It is in regard to the transition home in Watson Lake.

The Minister knows that the transition home in Watson Lake has had a very difficult time trying to operate throughout the year, and that they have had to try closing the place down for days and fundraise. They received money from British Columbia - thank goodness for that.

The Minister sent me a letter indicating that they had found some money, and would not require the money that they were seeking. Was the Minister telling us that Watson Lake should use the existing funding that he is saying it had available? There are contradictions there.

Hon. Mr. Phelps: Not at all. The allegations were made in this place, as well as publicly, that the society would have to shut down by the end of March, as it was $15,000 short. After looking at the books, that has proven to be incorrect. Rather, at the end of March, they will have a surplus of $16,000.

I understand that they did have a contingency fund amounting to about that much. There also seems to be some confusion as to when our funding for the next fiscal year, kicks in. Our funding is effective April 1.

Whether or not they decide to use the contingency fund for any special reason, this does not really have any bearing on the issue of whether or not they would be $15,000 short by March 31.

Ms. Commodore: The Minister does not appear to recognize the fact that the only reason they might have some existing money is because they were forced to close the place down for certain periods of time for lack of funding. Is the Minister familiar with the section of the Employment Standards Act requiring that every employer is deemed to hold interest for each employee all wages due or accruing due to the employee and that $7,500 due or accruing to employees shall be deemed a secure charge, payable in priority to any other claims. Is he familiar with that section of the Employee Standards Act?

Hon. Mr. Phelps: I am not clear about whether or not the Member is referring to the proposed amendments I tabled or to the current act. I suspect that there is a bit of confusion between the two, because we are proposing this super protection for up to $7,500 per worker, but the tabled legislation died when the last session ended. The facts remain that at the end of March there will be $16,200 in the bank account of the society - and that is assuming that they do not do any fundraising during this three month period.

Ms. Commodore: It is a bit annoying to those people who have to run the facilities with next to no funding to get them through the whole year, and the Minister has just indicated that if they do not raise any money through fundraising they should be okay. Is he saying that these overworked employees of the transition home in Watson Lake, in order to operate throughout the year, should be forced to hold fundraising activities? Is that what he is saying, and that that is the only way they can get by throughout the year?

Hon. Mr. Phelps: Again, I apparently was not very clear in my answer. My point was that, should there be fundraising during the period from the end of December to April 1, it would provide the Help and Hope Society with even more money than the $16,200 that is projected.

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


Hon. Mr. Phillips: I move the Speaker do now leave the Chair and 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


Chair: I will now call Committee of the Whole to order. Are the Members prepared to take a brief recess at this time?

Some Hon. Members: Agreed.

Chair: We will take a brief recess.


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

Bill No. 4 - First Appropriation Act, 1995-96 - continued

Chair: We are dealing with Bill No. 4, First Appropriation Act, 1995-96. Is there further general debate?

Mr. Cable: This question really relates to the debate, rather than the substance itself. Both I and the Member for McIntyre-Takhini wrote joint letters to all the Ministers asking that a full description of the various line items in the budget be given to us well ahead of time so that we could make the debate more efficient. I gather - I have not seen the reply to the letter, I guess I must have misplaced it - we were basically told to buzz off, and that the old process would be in place. I wonder why the government was not more responsive to us.

Hon. Mr. Ostashek: I have proposed to both the Members opposite another forum for this type of debate, where we could have an official sitting right there answering questions and providing information in more detail. That process has not seemed, so far, to be acceptable to the Members opposite. If the Members opposite require a technical briefing, I would be glad to provide that for them. Other than that, if this process is the one that seems to be appropriate for the Members opposite, we should continue with it.

Mr. Cable: The process I am talking about was a slight modification that has taken place over the past couple of years. Shortly before reporting on their departments, some of the Ministers provided the Members on this side with a description of the various line items and the breakdowns, which was helpful. I assume that those breakdowns were known at the time the budget was drawn up. I am not sure what the secret is. Why can the Members on this side not get a full description of the line items several weeks ahead of time? How does that disadvantage the government?

Hon. Mr. Ostashek: We did offer another alternative that was not acceptable to the Members opposite. We also left it open to each Minister as to whether they wanted to give briefings or other information ahead of time. If they did, we said that was quite appropriate. At the time, Cabinet did not feel that it wanted to make this something that had to be done by each department.

Mr. Cable: There was no suggestion that we have the power to summons that information ahead of time, but there was a suggestion that it would be useful. I am wondering what the Government Leader thinks about that. Would it not be useful for the various line items to be detailed ahead of time so that the Opposition can think about the information? Rather than getting up to ask for a description of every line item, as we go through this debate, ad nauseum, we could at least try to make the debate more efficient.

Hon. Mr. Ostashek: If that were to happen, I would probably take a different approach. I am not convinced that it would reduce the amount of debate in the House. I believe we would still have to stand up and put a description of each line item on the record, because that appears to be the procedure that has been used in the past and is the procedure with which most Members - at least in Opposition - feel comfortable. Rather than being repetitive, if we are going to have to debate in the House, and this is the forum that the Members opposite want to use, then so be it. This is the forum we will use.

Mr. Cable: We were not asking for briefings; we were asking for information. Sequestering information does not do anybody any good. There is no secret about these various line items. It is simply a matter of when they are going to be presented. It may very well be that it will not shorten the debate, but if we do not try it, how are we going to find out? Is the Government Leader prepared to give it a try?

Hon. Mr. Ostashek: I believe it is being tried. Some of the Ministers are doing it in their departments, and we will see how it works.

Mr. Cable: We have opened the debate. As far as I know, none of the departments have provided line-by-line descriptions. Education has provided us with a generalized briefing, but Education has not gone through and prepared us a script of line-by-line items, which was asked for in the letter. Let us not dwell on that any longer.

Let us move on to another topic, one that I know the Government Leader is quite enthusiastic about, and that he has discussed in Question Period debate, and that is self-sufficiency. Perhaps we can get a little to and fro going here that we cannot do in Question Period.

I asked the Minister whether this self-sufficiency thrust was related to the turnover of resources. He indicated that he could not say when we were going to be self-sufficient. So, let me ask this question: what, in very general terms, is the Minister's view of self-sufficiency? Is it raising all of our own revenues, or a very substantial part of our own revenues, or just what target are we shooting for?

Hon. Mr. Ostashek: I do not believe that we are shooting for any financial target. Part of self-sufficiency is being able to make our own decisions. I believe that the Member opposite has openly criticized this government - I am not so sure he has criticized his counterparts in Ottawa - for allowing the forestry transfer to deteriorate to the sorry state it is in. This has happened because there has not been a commitment by the federal government to do anything about it. With the devolution of programs - in an attempt to be more self-sufficient, as I have said - we get the responsibility and the opportunity to make policy and legislation in the Yukon that pertains to Yukoners. That is all part of the package, and an important part that, I believe, every government that has sat in this Legislature, for as long as I can recall, has striven for - to take more of the decision-making process away from the Ottawa bureaucrats.

Mr. Cable: That may very well be one aspect of self-sufficiency - self-rule, self-government and devolution, and all those things - but self-sufficiency has a real financial smell about it. Surely, the Minister is not saying that his reference to self-sufficiency in the budget address is simply a reference to devolution. Surely, there must have been some sort of financial goal that he has spoken about, both in this budget speech and in the Yukon Party literature over the last three years.

Could the Minister indicate whether he, in referring to self-sufficiency, is talking about self-sufficiency in the sense that, say, Newfoundland has economic self-sufficiency, or Ontario has economic self-sufficiency, or are we simply going to lower the handouts by a few percentage points?

Hon. Mr. Ostashek: We, the Official Opposition, and the Member for Riverside, have all said that the level of funding we have received in the past from Ottawa cannot continue, and we all realize that. In order to offset some of that, we need some economic levers to pull. With the devolution of resources from Ottawa to the Yukon, Yukoners can make decisions and pull the economic levers, giving us a chance to raise more of our own revenues. I do not know if we will ever get to the point of being a "have" province - if I can use that term - when there are only three "have" provinces in Canada today. I do not think we want to have any illusions that that is going to happen in a very short period of time. However, with our small population base, there is the ability to control our own destiny better than Ottawa does.

Mr. Cable: I could not agree with the Minister more, and perhaps that will happen in the context of devolution. Devolution and self-sufficiency are two markedly different concepts, even though they may be linked to one another.

Here is what the Minister said in his budget speech. "It is only through the ownership and control of Yukon land and resources that Yukon First Nations and the Yukon government will be able to achieve self-sufficiency and a better life for all Yukoners."

What did the Minister mean when he used that term in the budget speech?

Hon. Mr. Ostashek: We could continue in the present format with the resources being owned by the federal government, with all the decision-making processes for developing those resources being in Ottawa, with all the revenues - if they bother to collect them - going to Ottawa. We do not have the ability to expand our economic base by making our own decisions here so that we can set revenue flows according to what we need to develop our industries. The Member opposite is absolutely right; self-sufficiency and devolution do go hand in hand, and it is a goal for which we have to continue to strive. As I said, there are many provinces that are not self-sufficient. One would be hard pressed to say that some of the Maritime provinces are in a position of self-sufficiency, even this many years after Confederation.

Mr. Cable: Surely the Minister and his officials have looked at the value of the resources and the revenues that would be yielded on a yearly basis. We are raising slightly less than 20 percent of our own revenues, at present. Most of our money comes from the federal government, either directly or indirectly. Of course, a lot of the tax money that flows to the government comes, in part, from the economic value that the federal government has with its payroll and its programs.

What does the Minister see as the value of these resources: forestry, land, oil and gas and minerals? To what percentage will this take us to, as opposed to the less than 20 percent we are raising now? Will it take us to 60 percent, or 80 percent - some other number?

Hon. Mr. Ostashek: If I were to present a figure at this point, it would be very hypothetical. Our resources are, literally, undeveloped; the Member opposite has to appreciate that.

Regarding oil and gas, there have been a total of 67 or 87 wells drilled in the history of the Yukon. That is not very much. The potential is there, but to put a figure on it at this point, I do not think can be done.

If we are fortunate and are able to encourage companies to begin explorations here, there is good potential. We should be able to have control over that potential; it is that for which we are striving.

Mr. Cable: I could not agree more. However, the government does long-term forecasts for up to five years - is that correct? Is this not the kind of long-term financial crystal ball gazing that the government engages in?

Hon. Mr. Ostashek: Yes, we project on formula financing and other variables. We have not projected on the resource royalties, because we do not yet have control over them. We are only in the initial stages of taking over oil and gas. A lot of that is on hold pending the settlement of land claims. We must work with the First Nations. There is some revenue sharing with the First Nations in the umbrella final agreement.

We have all heard the former bureaucrat from DIAND, who recently said that the forestry industry could be a $400 million industry. This is his hypothesis. However, for us to calculate revenues based on a $400 million forestry industry prediction would be very naive at this point.

We do not know what its potential really is, because the federal government has done next to nothing to inventory the resource. They have done nothing to provide for silviculture for the blocks of timber that they have given out.

These are all areas that are going to have to be developed in the new policy, regulations and legislation, so that we can make forestry a viable resource. As to where it is going to go or how quickly it all will happen, who knows, but if we have control over it, I believe that we will be able to manage things a lot more expediently than has the federal government.

Mr. Cable: Maybe the Minister is right, but this summer the federal Minister of DIAND indicated that he was going to be working on a three- to four-year time span for the turnover of the remaining resources. Is this the Government Leader's understanding of the position of the federal Minister?

Hon. Mr. Ostashek: The Minister has not said anything to me since those statements were made to make me believe anything different. The fact that we devolved in that three- or four-year period is not all of a sudden magically going to give us a whole bunch more revenue. If we know that we are getting resources over a period of time, we can start putting the mechanisms in place so that we can develop our resources and start the revenue flows coming to the Yukon, but to put a figure on it at this point would be very speculative.

Mr. Cable: Of course it would, but it would seem to be prudent priming for the future. The Government Leader knows that there are going to be a lot of problems, federally, and that the money that comes from the federal government is going to be under pressure, yet we do not seem to have any idea of what these resources are going to yield us. That is just good planning.

The Government Leader was instrumental in hiring a gentleman to look after devolution and the land claims. The other significant event that is going to take place is the turnover of all these resource revenues. Has anybody at all been charged with calculating these resource revenues and having a little look into the future?

Hon. Mr. Ostashek: Resource revenues are one of the equations that is taken into the devolution process, based on what the resources are producing for the federal government now. That is one of the equations that is used in the devolution process and Members can be assured that the federal government is not going to want to give anything away, given the fiscal realities facing it. We are not forecasting increases into the future, those sorts of things. We want to get control of the resources first, and then we will deal with the issue of forecasting what the potential of these resources can be.

Mr. Cable: I cannot quite understand where the Government Leader is coming from. We have the Yukon land claims, which we established last year. There was nothing set up really to determine the economic value of those claims in any detail. I do not mean the dollars to come from Ottawa; I mean the multiplier effect as the money is taken in by the First Nation people and spent in the broader community. Last year, at any rate, there was nothing done in that area, and now we have a second major economic event, which is the devolution of resources, and there does not seem to be anything done in that area either.

How does the government handle long-term forecasting? Does it not take into consideration these two very significant economic events?

Hon. Mr. Ostashek: I do not think we have to re-invent the wheel to come up with an forecast of the potential of the settlement of land claims in the Yukon. I am not sure where the Member is coming from. Does he want us to embark on huge studies? For what reason would we do that when there are formulas already put in place that have been established by the Conference Board of Canada and other think tanks that do those projections, based on the millions of dollars that come with a particular program.

That is on the land claims side. On the devolution side, what we are looking at in the near term is what it is costing the federal government to provide that service to the Yukon today and what they are prepared to give to us to provide that service. Those are the issues, and t

he revenue-sharing formula is set up for most of those resources under the umbrella final agreement with the First Nations. I do not know what the benefit would be to undertake a study, such as the Member opposite seems to be indicating we do, to try to project five years down the road after devolution and try to establish what kind of revenues we are going to get. I do not think that is important at this time.

The services are being provided here by another level of government now. What we have to do in our negotiations with them is to negotiate a figure to provide those services to the Yukon, less the revenue that those services are taking in now, based over a certain period of years. That is the kind of formula we will be looking at in devolution. We do not want to be projecting ahead of time that we are going to take in X dollars down the road.

A case in point could be what is happening with forestry. Due to the tremendous demand for lumber, the federal government has just put out a tender. It is getting a substantial amount of money from the timber, which is in the area of $60, compared to 20 cents that they have been charging in the Yukon. Now they want to take those kind of figures into the calculations during the forestry devolution negotiations. That is not in our best interest.

Mr. Cable: Of course, it is in our best interest to get the resource as cheap as possible, and I am sure that the Government Leader will be doing his best to achieve that. What I do not understand is that the Government Leader has put out literature, as a person wearing a Yukon Party hat, and he has spoken to the Yukon people through his budget address and used the term "self-sufficiency". There does not seem to be any general idea of what the term "self-sufficiency" means, and there do not seem to be any calculations relating to the two most significant economic events that are on the horizon, so how can the Government Leader talk to the Yukon people about self-sufficiency?

Hon. Mr. Ostashek: I do not understand what the Member opposite is trying to get at. Let us take the issue of land, for example. During the almost 25 years I have been in the Yukon, the biggest complaint from Yukoners has been that they cannot get land, because the federal government has control of it. When we get the land, and can decide what we want to do with it, there will be some economic benefits from it. Right now there is nothing. Why would we be going ahead and calculating the economic benefits from it, before it is devolved from the federal government? I do not understand. I suppose one of the definitions of "self-sufficiency" would be that we would be raising a sufficient amount of our own revenues, so that we could do away with the need for formula financing altogether. That is an admirable goal, but surely the Member opposite does not expect us to accomplish that in five years. We are certainly not intending to do that, but that is an admirable goal and one that we are working toward. Does the Member opposite not think that, at some point in history, Yukoners should be one of the "have" areas of the country, and not so heavily dependent on the federal purse? That is what we always talk about. In order for us to be self-sufficient, we have to have control of those resources and develop them in a manner that will be most beneficial to the Yukon, both in the economic sense and in the quality of life.

Mr. Cable: I am quite sure the previous administration must have done some elementary cost-benefit analysis when they worked up the Northern Accord. I am also quite sure that this Minister, the Government Leader, would not want to take charge of the resources simply to take charge of the resources, if they were not going to prove out on the cost-benefit analysis, and if they were simply going to be some sort of sink-hole. Surely we must have some idea whether the turnover of the resources is going to be profitable for the Yukon people. Has there been no elementary analysis done whatsoever?

Hon. Mr. Ostashek: Perhaps I have not explained it clearly enough, but that is exactly what I just said to the Member opposite. Devolution negotiations take place on what benefit and cost it is to the federal government now. We are not creating something new. We are taking over a service that is being provided here by another level of government. There are dollar figures attached to that, as there were to the Northern Accord, and as there will be to forestry, lands, minerals and water. Those are the figures that are involved in negotiation, not speculation on what the revenues will be 10 years down the road.

Mr. Penikett: The Member for Riverside asked a very important question. I do not want to prolong the debate this afternoon, but I would ask the Government Leader to take it as notice. I think this issue is fundamental. Can the Government Leader not define what he means by "self-sufficiency", a term he has used over and over again, in all the policy documents wrapped up in that statement, including that Towards the 21st Century document - with the railroad to Carmacks and the gas pipeline from Watson Lake, neither of which are likely to be built in this century or the next century?

From what the Government Leader has been saying, this notion of self-sufficiency, and the expression, have been used very loosely. If the Government Leader cannot tell us exactly what he means by it, I would seriously like to ask him to come back to the House with a definition. I thought I knew what the expression meant but, after listening to the Government Leader answer the Liberal Leader's questions for the last few minutes, I do not think the expression has been used in any definable way at all.

Hon. Mr. Ostashek: I disagree with the Members opposite. As I said, "self-sufficiency" is not that hard to define: it is not being dependent on anyone else but oneself. That is our goal. What we cannot tell the Members opposite is when that goal will be achieved. There are no magic words to describe "self-sufficiency".

Mr. Penikett: I did not ask the Government Leader when we would become self-sufficient. I did not even invite debate on the point of our current dependency on the federal government, which is, of course, worse now than it has been for years. We are obviously becoming more dependent, not less, and it seems to me that we are not moving in the direction that the Government Leader says we want to move.

Let me ask the Government Leader this: would he come back to the House with a definition of "self-sufficiency"? What percentage of revenues supplied by the federal government would constitute self-sufficiency, in his mind?

Hon. Mr. Ostashek: No, I certainly will not make that commitment because we are talking about a fluid target. The demands that are facing the government continue to change. It would be very foolish and naive of me to make a statement as to what percentage of revenues would make us self-sufficient. As I said, self-sufficiency is when we are not dependent on other levels of government for resources. Until such time as that is accomplished, we will not be totally self-sufficient, but that should not stop us from working toward self-sufficiency.

Mr. Penikett: Given the level of dependence on the federal government, and given that the Government Leader will not give us numbers, will he give us a definition of "self-sufficiency" in plain English? The suggestion that "self-sufficiency" means that we are entirely independent of federal revenues is something we are not likely to see in the 21st century, much less the 20th.

I see the Deputy Minister of Finance has just provided the Government Leader with one. Would he give us, in plain English, his definition of "self-sufficiency"?

Hon. Mr. Ostashek: I did just give it when I stood up before. To be totally self-sufficient would be the same as when the Member opposite left home, or I left home, and we were no longer dependent on funds from our parents to make our way in this world. That would be self-sufficiency. The difficulty with trying to answer the question the Member opposite is asking is that we do not know where the federal government is going, nor what kind of devalued dollars we will be facing in devolution, nor what additional revenues, if any, are going to be offset by a formula grant. These are all issues that have to be negotiated. It would be very naive of us to try to put a figure on what we must raise before we are self-sufficient.

Further to that, in reply to the statement the Member made earlier, I do not think we are any more dependent on the federal government now than we were in the past five, six, or seven years. The percentages are very close.

Mr. Penikett: We will debate that point later. Just for the record, I doubt that I was totally self-sufficient when I left home at 16. In fact, I probably did not become even marginally self-sufficient until after I had been at university for a few years and was employable at an income that would support me. The Government Leader keeps coming back to his fudge about how much of a share of Yukon's revenue would constitute self-sufficiency and does not want to answer the question in those terms. I want to ask the Government Leader to take this question as notice: will he come back with a plain-English definition of "self-sufficiency", as he is using the term? If he will not do that, all of the policy statements that include "self-sufficiency" are meaningless - they are empty rhetoric.

Hon. Mr. Ostashek: I think that this is a ridiculous type of debate to start with, but I will see what I can do to satisfy the Member opposite. I am having great difficulty with this type of debate.

Mr. Cable: I do not want to irritate the Government Leader, but when he started this self-sufficiency thrust, it was in the context of infrastructure-driven self-sufficiency. That is my recollection of the literature that was released. From the budget debate and from what I have heard today, it appears to be driven by the turnover of resources. I believe that I asked the Government Leader a question on that very issue in Question Period, but did not receive much of an answer. Besides infrastructure-driven self-sufficiency and turnover of resources - the revenues, assumedly - what is going to move us toward self-sufficiency? Or is that simply a two-pronged attack that the Government Leader is launching?

Hon. Mr. Ostashek: Those are two key areas. As I believe I said to the Member opposite in debate prior to that, if the resources were all turned over to us and we had no infrastructure in place to develop them, we would be a long, long time in becoming anywhere near self-sufficient. So, infrastructure development is very important. I believe that the sorry state of infrastructure across the country is a debate that is going on across Canada right now. The Province of New Brunswick is leading the charge with respect to the national highway system and its deterioration and our inability to be able to compete and to lower freight charges because, in its opinion, the infrastructure has been allowed to disintegrate. So, it is a very key role. Along with the resources and infrastructure development, however, what is needed is the ability to make one's own decisions. This is all part of the package.The latter, of course, is linked to a previous one.

Mr. Cable: Is there any other arm to this self-sufficiency thrust, other than the turning over of the resources and the infrastructure construction, such as the roads to mines and hydro linkages? Is there any other facet to the government's policy in this self-sufficiency drive?

Hon. Mr. Ostashek: Everything contributes. Whatever we can do for tourism, agriculture, trapping or fishing - all of these things help us to be self-sufficient. We have to work on all these areas. The main areas we are presently dealing with are the ones we just spoke about. It is important that we make decisions on these two areas, so that we can carry on with some of the other things.

Mr. McDonald: This has been a fascinating discussion, but I can honestly say that I cannot really understand the government's economic strategy, or even its fiscal strategy, any better. I can assure the Member for Riverside that that is not a criticism of him.

I am, in some ways, long past trying to ask the government about its own agenda; it only confuses me. However, I do have one brief question about self-sufficiency. I wonder if the Minister could give us a brief definition of self-sufficiency. Does he mean by it that the government will take in more revenue than it spends? When it reachs that point, will it be self-sufficient?

Hon. Mr. Ostashek: I imagine that, at that point, we would be fully self-sufficient, if it meant that we were not dependent on anyone else for revenue. As I said, that is a long way down the road.

Mr. McDonald: I suppose I have never heard it put in exactly those terms, so I will leave it at that.

I have a couple of questions that arise from Question Period today, in terms of the casino and tax revenue.

Does the government intend that the casino project will be a net generator of revenue for the government?

Hon. Mr. Ostashek: I do not expect it to cost the government any money, let us put it that way. The main thrust of going ahead with a casino was not based on increasing government revenues.

Mr. McDonald: Is there any way the government can put to rest any citizen's concerns that the gambling casino project is going to be simply a tax grab?

Hon. Mr. Ostashek: I would hope so. We have said that, but we were looking for some sort of revenue sharing. If we are going out to non-profit groups, there is a substantial amount of money expended on the management and this all has to be taken into consideration prior to receiving any revenues. Our main goal, as we said, was to get some regulations in place so that we did not see a proliferation of casinos across the Yukon. That is the main thrust of this exercise.

Mr. McDonald: Obviously, another thrust of the exercise is to build a casino in Whitehorse, because the government has stated, as such, that that is what they are going to do. Whether it prevents a proliferation of casinos elsewhere is something that we have yet to determine. We know there is going to be at least one more casino in the Yukon, and it will be in Whitehorse if the throne speech is to be believed.

The Minister indicated that they are going to be going out to proposal calls at some point but, after Question Period today, I think one can probably conclude, at least in part, that there is some policy work to be done before the proposal call is sent out.

Can the Minister give us some sense of timing for this whole project? When is the government going to be completing the policy work? When is it going to be making those policies public? When is it going to enter into the consultation about the policy work? When are we going to see the proposal call?

Hon. Mr. Ostashek: We are hoping to be able to accomplish that over the next couple of months. We want to get the policy work in place and everything identified prior to even entertaining proposals. So I would say we are at least a minimum of two months away from that.

Mr. McDonald: This two-month period will also include public consultation on the policies, is that correct? Can the Minister give us a sense of preference for how widespread the consultation will be and will the consultation include the fundamental question as to whether or not there should be a casino at all in Whitehorse?

Hon. Mr. Ostashek: That is exactly what we talked about in Question Period today. No, I cannot play it all out here for the Member opposite because we have not got it fully defined yet. The committee is working on it and will be coming back with the options that are available to us to proceed with the consultation process with the public to see if there should be a casino in the form we are talking about - a tourist-oriented, seasonal casino.

Mr. McDonald: Is the Minister saying - and this is something he cannot be advised on; he will have to make the political decision himself, along with his ministerial counterparts - that the consultation will include the question of whether or not there should be a casino at all?

Frankly speaking, the support that one has been able to identify, as much as one can characterize it as support, is qualified, to say the least. Even the associations, such as the Tourism Industry Association, whose activities one would have been led to believe this project was geared to support, was quite ambivalent about whether or not it should support the project, for some of the reasons I have stated in this Legislature, including the reduction of disposable income in the community. It also had serious concerns about the impact on what was once a unique tourist attraction in Dawson - the gambling facilities there.

There are a number of other reasons, quite apart from the very legitimate ones raised by the Members for Whitehorse Centre and Riverside about the social costs. There are some legitimate business concerns about developing any casino.

Does the government have a sense of whether or not it will be asking fundamental questions? A lot of people are talking about it in terms of whether or not there should be a casino at all.

Hon. Mr. Ostashek: We are going to have to ask some fundamental questions. While the Member opposite is saying that there is a real tide of resistance out there, it has not been indicated in the correspondence or calls we are getting. It has not been a burning issue with the public to this point, which is why it is important that we know exactly what the public wants. From what came out of the YCEE, there was a substantial amount of support for a tourism-oriented, seasonal casino run by a non-profit group, providing the policy questions were answered.

That is the area we are working on now.

Mr. McDonald: I am really practised at reading government reports, and I am also practised at reading reports of such organizations as the Yukon Council on the Economy and the Environment. I know that when they say opinion was mixed and they could come to no conclusion on some fundamental questions, that is when one's antennae naturally become excited. They have made a point of identifying where they do and do not agree on the concept of gambling among themselves.

When they cannot agree, they have specifically identified the areas for which there is no consensus. In this particular case they have made it very clear that they all agree there should be no video lottery terminals; they all agree that there should be some policy work done, including the involvement of First Nations in the regulatory process. However, they cannot agree on whether or not there should be a gambling casino.

They were quite candid about what they had heard from the public. Through extensive consultations that took place over a number of months during a period that was probably longer than the government will be able to afford itself when it comes to further consultation, the public was, at that point, 73 percent opposed to expanded casino gambling; only 23 percent supported casino gambling. The minority of people who indicated support for the casino were the British Columbia-Yukon Hoteliers Association and the Video Lottery Consultants of Montana.

When it comes to identifying the people who are very much opposed to gambling, the list is long. It includes a lot of First Nations people who are involved in resolving social concerns. From my perspective, I am wondering what has caused the government to want to embrace this particular project, given all of the other possibilities that are available to them, and when opinion on the issue seems to be split and so one-sided? When I attended the Tourism Industry Convention, the people there were very clear about their concerns, but did not want to adopt a final position, because there was some difference of opinion. I remember that a couple of people there did speak quite vociferously for expanded casinos, and there were a number of people who spoke very vehemently against it, particularly in the service and retail sector, because they see a casino as being competition for them. Naturally enough, the people in Dawson were probably the most vocally resistant to the concept. I would have thought that if there was ever an organization that would be a hot-bed of support for a casino in principle, it would be the Tourism Industry Association, but I simply did not see that support from that organization. I have not seen anybody else resolve, through a statement at an annual general meeting, that they support expanded gaming. Frankly, I am puzzled and, under the circumstances, I am a little nervous about what the government anticipates will be an appropriate standard for consultation, because the Council on the Economy and the Environment has gone through this process.

If the Minister is now saying that he is going to be asking the basic question as to whether or not there should be casino gaming at all, then I am anticipating that they are going to get the same kind of reaction that the Council on the Economy and the Environment did. Unless the government has already made its decision, that would suggest that the government is going to have to reject the concept of the casino altogether.

In any case, I ask the Minister this question: can he commit to us that the basic question about whether or not expanded gambling will be permitted will be put directly to the public and will he give us the results of that survey - or however they want to construct it - so that we can judge for ourselves whether or not there is widespread community support?

Hon. Mr. Ostashek: I can make a commitment to the Member opposite that we will give him the results of the survey, as well as the questions that will be asked in a survey, if a survey is the route that we go. We are putting that together now, and we are waiting for the officials to come back with recommendations about what process we should use. I will make the commitment that the results will be made public.

Mr. Cable: I have just a couple of questions. We discussed the other day best case, worst case scenarios on the revenue side, and I believe the Government Leader, if I recollect correctly, committed to providing those best case, worst case scenarios. Is that correct?

Hon. Mr. Ostashek: Perhaps if the Member opposite could refresh my memory. Are we talking about the 1995-96 budget, or are we talking about future years?

Mr. Cable: We are talking about the mains that we are debating right at this very moment. Could that be provided in some kind of a timely fashion?

Hon. Mr. Ostashek: We can do that, but I just want to say to the Member opposite that he must remember that there is not going to be very much variation, because the grant is frozen for the 1995-96 year.

Mr. Cable: I think that in the past there has been a fairly significant sum of money - what I mean by significant is several million dollars - between the best case and worst case scenarios. Is that an accurate reflection?

Hon. Mr. Ostashek: I guess that if we are talking about several million dollars, yes, we are talking plus or minus $10 million - somewhere in there. When we are talking about, as the Members opposite like to portray, a one-half billion dollar budget, that is not a very large percentage.

Mr. Cable: I am working up to two things: the previous tax increases and the variations on the expenditure side. Approximately how much revenue did the previous tax increase, which was about one and one-half years ago, yield on an annual basis?

Hon. Mr. Ostashek: The increases yielded about $3.7 million in personal taxes and slightly more than $3 million in corporate taxes. The diesel fuel tax increase yielded $778,000 and the gasoline tax increase generated $1,387,000. The tobacco tax generated $3,537,000. The total increase was $12.4 million.

Mr. Cable: It appears, from the revenue handout that the Government Leader gave us as he introduced the debate - or shortly afterwards - that this has been generally less than two percent of the federal grant. This would appear to be of the same general order, if I have the numbers right, as the tax increases.

Also, the variations on the expenditure side of the supplement, which we had previously debated - if the Government Leader will bear with me, I will get the number - is a net expenditure of $13 million. This is the supplement estimate No. 1 for 1994-95.

The tax increases, which is the variation between the best case and worst case scenarios, and the variation on the expenditure side, would all seem to be of the same order. What I do not understand is why the Government Leader could say definitively, in view of the fact that these variations can move over the same span as the tax increase, that we needed a tax increase to balance the budget.

Hon. Mr. Ostashek: We are going back to talk about a tax increase that was implemented two budgets ago. At that time we felt we needed it, because the Yukon was in a deficit position and being faced with a downturn in the economy. We had services to provide to the people, and those tax increases were based on that budget and what we foresaw coming down the road, which I am sure the Member opposite agrees with me is still coming down the road. We got the federal Finance Minister to delay it by one year. He agreed to put off any cuts that would come to the Yukon until such time as they were implemented for the provinces. So we still have not crossed that bridge. That bridge is still coming and I am sure the Member opposite will agree with me that this is a very nervous time in Canada these days.

Mr. McDonald: I have a few questions to ask the Government Leader in general debate, firstly about one subject, and then I simply want to do a survey of questions about the revenue assumptions under the budget before we leave general debate.

I have a couple of questions to ask the Minister about the Taga Ku project and the government's response to the Taga Ku proponents over the course of the last year or so. In the most recent salvo coming from the political arm of government, the Government Leader has accused me of being responsible for the Taga Ku fiasco because I did not save the government from themselves when they were making multi-million dollar decisions about the Taga Ku office and convention centre project.

I would like to ask the Government Leader why the government has taken the position that they are unwilling to discuss with the Taga Ku proponents an arrangement whereby some element of the project might proceed, thereby avoiding any further legal activity.

Hon. Mr. Ostashek: I am not so sure that the Taga Ku would be interested in beginning negotiations with us to revive the project now, when I stated quite clearly, at the time that offer was made to them - at the time this came to a head - if there was not some way we could resolve it in order that the project could go ahead in one form or another. They were not prepared to do so because they believed they had a certain commitment from the previous administration.

Mr. McDonald: Before I suggested publicly that it might be prudent and responsible to continue negotiations, to see if there was a project at all worth salvaging, I did take the trouble to ask at least one of the Taga Ku proponents whether or not they would be prepared to consider further negotiations or discussions. That proponent did say yes, that indeed they would be interested in doing that. Consequently, I remain puzzled as to why the government did not take the opportunity, not only to limit their potential losses, but to do the right thing from a public policy perspective. It is no secret that the Yukon Party government's relations with First Nations are strained. At the Geoscience Forum we heard from a number of participants about the need for a proper convention centre. So, we know that there is some community support, at least, for a convention facility. Ever since the Taga Ku project seemed to fall apart, we do know that Northwestel has been making moves to suggest that Northwestel's head office status in Whitehorse is perhaps not as secure as it once was, and certainly would have been had Northwestel occupied a new office tower of its own in Whitehorse.

So, I asked the Minister why there were no discussions with the First Nation proponents for the Taga Ku project. Why was there no attempt to provide more optimistic signals to people who had tried to put together a project that was, obviously, worth something to somebody?

Hon. Mr. Ostashek: When this issue was being brought up, I made it very clear, through public statements, that I was prepared to live up to any commitments made by the previous administration. I said that publicly and I meant it. We believe that we tried to accomplish that, and we were not successful. The case is still before the courts. We filed an appeal on the judgment as we did not agree with it. It will work itself out through the courts.

Mr. McDonald: The Minister has not made clear his decision for wanting to appeal. That will presumably be part of the appeal. The judge's decision, at the time, made it patently obvious - what was obvious to everyone else - that the hotel had been delinked from the convention centre office complex. Not only was it well known within government, but it was also on the front page of the Whitehorse Star a month earlier. To suggest that there was some doubt about whether or not that issue had been settled, in the sense that the hotel had been delinked, flies in the face of common sense and reason. The judge characterized it that way. The Minister indicated to us - and to anyone who would listen - and he has repeated today that he was prepared to live by any contractual commitment made by the previous government to support the Taga Ku complex. Given what the understanding was in September at the time the decisions were finally made, it is fairly obvious that the hotel had been delinked. What rationale did the government have for continuing its legal action?

Hon. Mr. Ostashek: I do not want to get into the details of this case, because it is still in front of the court. However, I take exception to what the Member opposite is saying.

First of all, I said quite clearly that we were prepared to live up to any obligations made by the previous administration. If we were interpreting their obligations in a manner they did not believe in, that Member had a moral obligation to pick up the telephone and tell me so, just like the previous Prime Minister phoned the present Prime Minister on the issue of the referendum in Quebec.

Mr. McDonald: First of all, not once did any Minister approach me about any matter in respect to the transition, until they got into trouble in the Legislature. That is the first point.

The second point is that the outgoing Government Leader offered briefings to the government side on any matter it thought it should hear about. At no time was that offer taken up.

The point of the matter is not whether either of those things took place. In this particular case, as was found through evidence, everyone who had any association with this project knew that the hotel was delinked from the rest of the project. The judge says it defies common sense, and he repeats it on a number of different occasions. It is patently obvious that people knew.

Now the Minister is saying to me that, even though I was not involved in any of the discussions and had absolutely no knowledge of any of the discussions he had with the Taga Ku proponents, and consequently could in no way determine that the government was going to be making a fatal error, somehow I should have intuitively understood that the government was going to make a mistake and respond to it by offering a briefing and setting the government straight.

In 1992, I had no idea the government was going to make so many mistakes. I had no clue that the government was going to behave in that way. Now, for the Government Leader to come along and put out this absolutely outrageous press release, after hearing from the judge in the case, saying that I am responsible for the government's decision, is absolutely ludicrous and with no foundation whatsoever. I do not know how the Member could be so embarrassed.

Some Hon. Member: (Inaudible)

Mr. McDonald: The Minister says let us get into this in detail. We are in it, right now.

I want to ask the Minister who is responsible for government decision making after November, when the judge in the case said that there was no possible way that anyone could have assumed that the project was still integral - that the hotel had to be attached to the convention centre? It absolutely boggles the mind that somehow it is now the responsibility of an Opposition Member to save the government from its own errors.

I want to get a shred of evidence about this. Does the Member have a shred of evidence?

Hon. Mr. Ostashek: I am not going to speak about the court decision, because it is being appealed. I want to make that very clear to the Member opposite. I also want to make it clear to the Member opposite that there were five officials who testified that that Member never made it clear to them that the hotel was delinked from the project. That Member was part of the Cabinet that did not even leave a paper trail that said it was delinked. That is the way they were running the government.

It was the biggest project in the Yukon. If those decisions were indeed being made, they were being made without a paper trail. After we said publicly that we were not going to go ahead, and that Member knew the reason we were not, he had a moral responsibility. He could have picked up the telephone. Even if he was not asked, he had a moral responsibility to say, "Government Leader, you are wrong." He did not do that.

Mr. McDonald: First of all, if one looks back in the record of Hansard, one would have to be deaf, dumb, and blind not to recognize that the Opposition of the day, the current Opposition, was completely opposed to the government's actions long before there were any court proceedings or any legal case at all. I would point out to the Minister that the judge indicated, and I am paraphrasing, that as of September 22, no one in the government who was familiar with the project expected that the hotel could be built in conjunction with the office space. This was said by the judge who had just heard all of the evidence.

To assume that the negotiations could be pursued on the assumption that there was a hotel as part of the project is unrealistic. It flies in the face of all that was known about the state of affairs, as of that date - September 22.

It goes on to say that everyone in government who was involved with this project knew that the developer could not get financing with the hotel being part of the project. These are people speaking to the judge under oath.

Given that it was completely unrealistic to believe that the hotel could be part of the project, as of September and, given that it was on the front page of the Whitehorse Star in early September - September 2, I believe - that the hotel was delinked, what, in heaven's name, possessed the Government Leader to think that there was any doubt about that particular element of the project? What possessed the Government Leader to believe, in spite of the testimony under oath, that the government personnel did not understand the situation?

The tone of discussions from the Yukon Party, both before and after the election, however, suggested that the government did not want the hotel project or the Taga Ku project to proceed at all. That is what drove many of the questions in Question Period at the very first opportunity, in December 1992, before the court case. There was a very strong hint that the government had no intention of fulfilling the commitment that the Government Leader had stated. They only indicated that they were only prepared to do what they could - to find whatever excuse they could or whatever argument was convenient - to close down the project. That was patently obvious at the time. That is one of the reasons for the questions being asked.

The Minister came back with a very puerile and juvenile statement, as he is rushed off to a plane for China, stating that I was responsible for their mistakes.

In the face of all the evidence, this suggests that there are a number of people in government who do not deserve to hold public office.

Hon. Mr. Ostashek: And some of them are sitting on the other side of the House.

That Member says that there was an article in the paper on September 2 delinking the hotel. I am going to review the archives, because I think he is wrong. I think he is wrong for the simple fact that the Member for Riverdale South received a letter from that Member on September 17 saying that the scope of the project had not changed. That is what transpired. And that is a Member who now stands up and says it was delinked. He did not have the political courage to tell the people of the Yukon during an election campaign that they had dropped the hotel. All he was concerned about, from all the deliberations I have seen and the talks he had with officials, was to hide it from the public so that it did not surface until after the election.

Mr. McDonald: I thank the Minister for a typically childish response. I will tell him this: the only rational, political reason for not wanting to continue the discussions in public about whether or not there was financing for the office and convention centre was because we were not aware of any financing, and if we were to continue raising public expectations that there was going to be a project, only to find out that the financing was not there, it would clearly not have been an honest portrayal of what was happening. If we had done that at election time, we might have been accused, if the project had not proceeded, of raising expectations and dangling jobs in front of people when we were not in a position to be able to do so.

Does the Minister think for one moment that the Taga Ku project proceeding would not have been good news? Maybe from his own orientation, from his perspective and from his core of supporters, it would have been bad news, but from our perspective, a solid project, undertaken by First Nations in this territory, probably the biggest and certainly the biggest in western Canada, would be good news. From our perspective, hundreds of construction jobs would be good news. From our perspective, the creation of a convention centre to house conventions like the recent Geoscience Forum would be good news. From our perspective, to have Northwestel cement its head office in Whitehorse when we knew we could not find any other way - short of purchasing Northwestel, which was unrealistic - of cementing their head office status in the city, was good news.

From our perspective, doing something with the waterfront that was attractive and provided a nice anchor near Kishwoot Island in Whitehorse was good news. Does the Minister think for one moment that, if we felt we had the deal, for us to put the Taga Ku project on the backburner would have somehow been a political gamble for us? Absolutely not. Despite what the current government side thinks, and despite what the Yukon Party used to think, we believed this project was good news and would be good for the territory. We believed this project would be good for First Nations' business interests.

It is ludicrous to think that, for some reason, if we thought we had a deal that was going to produce a hotel we would do nothing other than announce it during an election campaign. No, the instructions were to announce it when we had a deal, to feel free to announce the project when we had the financing.

These latest arguments coming from the government side - some sort of Machiavellian attempt to keep the NDP from passing on the good news to the public - is ridiculous.

On September 17, the scope had not changed formally in government. That was part of the testimony before the judge. The proponents had indicated there was no possible way they could go ahead with a hotel, and they made that clear to the newspapers in early September; however, that did not mean that the government responded the same day, or even within weeks. There was tremendous resistance not to make a decision of such magnitude at that time, during an election campaign.

After September 17, the decision was made, and it was well known to the government and to some members of the administration - an administration that was supposed to be in the know. After hearing all the testimony, that was also the position of the judge.

The government's response makes no sense whatsoever. It is a childish response, blaming me. It makes absolutely no sense, particularly in view of everything that has happened. I cannot believe that the Government Leader has been elected to public office and is supposedly charged with acting in a responsible and reasonable manner. Nevertheless, those are the unfortunate circumstances in which we find ourselves, for the time being.

I am going to be very interested in how the government proceeds now, because if the formal appeal is built on the government's assumption that there may not have been a project anyway, then the Minister will have backtracked on his original commitment that he would live by whatever contractual obligations the government faced on the handover between administrations. This part of the case has been decided, whether or not there had been a contractual obligation. Clearly, there was.

Hon. Mr. Ostashek: I just cannot let the Member get away with that without responding to it, because the statements he has made are totally ridiculous. He talks about responsibility. Here is a project - the largest project in the Yukon - that he and his colleagues could not make a decision on for a period of at least six weeks. Then today he says that on September 2 it was quite clear that the hotel was delinked from the project. On September 17, he wrote a letter to the Member for Riverdale South telling her that nothing had changed in the project. He then has the audacity to stand up and say that I am not acting in a responsible manner as the Government Leader. He made one of the most important decisions that he could have made in his administration some time after September 17, and he did not document it.

It is unbelievable that he expects the public of the Yukon to believe that. There was a rumour during the election that the hotel had been delinked, and I would not be surprised if that was the basis for the Member for Riverdale South writing to the Minister. There was a rumour around but the Members opposite were certainly not prepared to go out to the Yukon public and say it was a good thing, because they knew what a lot of the Yukon public thought about that project.

If we want to act in a responsible manner, the Member opposite acted in a very irresponsible manner if he was able to make a $47 million decision without documenting it.

Mr. McDonald: I think that it is quite good that the Minister is now speaking from his gut, because now we are able to see the real reasons why this project was deep-sixed by the Yukon Party government.

We were saying, prior to the election campaign and during the election campaign, that we thought it was a good project. The Yukon Party, we all know, did not think it was a good project and it said so. That is the real reason why this project was deep-sixed by the Yukon Party. That is patently obvious. What does the Minister mean by, "a rumour around" that the hotel was delayed? This had been communicated, as far as the main proponents were concerned, to the city council. They made it very clear that they could not proceed with the hotel portion of the project and that if any project were to be financed in the future, it would not be including the hotel part.

If anyone were to ask, they would have been told that. The question was, does the government accept that, formally? That was the issue. The proponents were saying, very clearly, that the hotel was not part of the project. The government was saying that it wanted time to think the project decision through, and on September 22 it made the decision that it was going to proceed with the rental of office space.

Does the Minister think for one second that any of the bad publicity, the kind of publicity that the Yukon Party seemed to care about, was something that the New Democrats could actually hide from or pretend did not exist? Does he think, for one second, that if the New Democrats thought that they had a project in their hand that would have virtually eliminated the criticisms coming from the Yukon Party, they would not have simply announced it?

What the Minister is saying makes no sense at all. Once again, I refer to the judgment and say that it is very obvious what the government's thinking was. I do not know what officials have been telling the Ministers privately, but one can go back to the testimony actually delivered at trial, look at the reasons for judgment, and note the number of times the judge repeatedly stated that it was ludicrous to think that anything other than a delinked project could proceed or that the administration did not know what it was doing. If the Minister is suggesting that somehow there is any doubt about that, he had better develop a more critical eye when it comes to dealing with officials. I do not know what they told him or the reasons for telling him what they did.

I mull it over in my mind as to whether or not there would have been any utility whatsoever for me to phone up the Government Leader to explain something to him, given that his government believed that virtually everything that issued from the mouths of New Democrats was pointless, worthless and useless.

As I understand it, opportunities to brief the Ministers is a normal practice of transition governments. As a matter of fact, I had some meetings with Mr. Lang back in 1985, but offers to brief the incoming Cabinet Ministers were not even taken up by the government - not once. It is ridiculous to come back now and say that we should have forced ourselves into their offices to say, "Stop, you are making a huge mistake. Save youselves the grief"; it is ridiculous.

There is lots to discuss about this project, and I do not think we should be afraid of talking about it. We have a lot to say about this project and the government's latest, frantic attempts to avert any kind of concern in any direction they can - this pathetic attempt to turn people's attention someplace else. We heard that even today, when the Justice Minister got into a little bit of trouble over why they have directed another legal case, and what does he do? In order to deflect the criticism from himself, a decision he personally made, what does he do? He says it happened under the NDP administration. That was his response in Question Period. Maybe that is the kind of thing we can expect from this government.

Under the circumstances, and given everything that has been said on the record as far as the Taga Ku case is concerned, the government still has no case and is still thrashing about pointlessly. At one point during the debate, the Government Leader indicated that we will end up paying for it, and unfortunately, he is probably correct. He will not be around in government when the bill comes in, but some people in this Legislature may well be. We may well end up having to fork over some millions of dollars to make up for that mistake.

Hon. Mr. Ostashek: I just have a couple of comments to make to the Member opposite. I will go on with this debate as long as he would like to, because this is one that he cannot win. He still has not stood up and explained why, on September 22, he made a $47 million decision and did not document it; that needs to be explained. We have gone back through Hansard and the debate that went on here in the House in December. While they beat around the bush, they would not come out and say on the record that they delinked the hotel from the project. It is not in Hansard. I am not going to get into details about this, because the appeal is in front of the courts. I know what the judge's decision was, and I respect it. Even though I do not agree with it, I respect it. I will say to the Member opposite that there were five or six officials who testified, and their opinion was that they did not believe there had been any change and that the hotel had been delinked from the project.

Mr. McDonald: The officials talked to the judge, and were cross-examined by two sets of good attorneys. The judge then came up with a conclusion completely opposite to the one that has just been arrived at by the Government Leader. How strange that is. Perhaps it may be because the judge was not required to act in a political manner. Perhaps it was because the judge did not have to try and justify an abnormal political decision. Perhaps the judge just looked at the evidence of what people had said, both under examination and cross-examination. Perhaps he took that evidence at face value, and did not have to force-fit a political argument to the facts.

When it comes to credibility, I think that most people in the public have already made up their minds. However, if I were to weigh the judge's position, after hearing all the evidence in front of two sets of lawyers, against the Government Leader's, who is trying to enforce a political decision - a badly considered one, at that - I would choose the judge's credibility over his, any day.

The Minister seems, now - this is the latest thing - to be all wrapped up in the question as to why there is no document from September 22, spelling out, to the Government Leader's satisfaction, that the hotel was delinked. First of all, there is a lot of decision making that does not include letters confirming a decision. I would venture that 99 percent of what the Government Leader decides is never confirmed in writing to anyone.

Secondly, in the context of the discussions, once again, at the time, for anyone involved in that project from the government, it is beyond common sense - in the judge's words - for anyone to suggest that people did not know the circumstances of that decision. He said it was "beyond common sense". Everyone knew and discussed it internally. The decision of September 22 was obvious, even if one was not actually involved in the telephone calls or the discussions.

I suppose the Minister still wants us to believe his version of the events, after the fact, and ignore the evidence and the impartial judge's decision that was delivered this fall.

Given the conversations on the street, I am certain the Yukon Party is going to pay its own price for this. Unfortunately, it is not going to be anything like the price the Champagne-Aishihik Band has paid, is paying, and will continue to pay as a result of this decision. That truly is the saddest consequence of all, in my opinion.

Hon. Mr. Ostashek: And it is a price they would not have had to pay if the Member opposite had done his job in a responsible manner.

Any time any Minister makes a $47 million decision and does not document it - I did not say he had to write a letter to anybody, but I would have thought there would have been a file somewhere with that decision recorded in it, if for no other reason than to protect the Minister. I just want to say once more for the record that we asked the proponents of this project to come forward with some evidence that the hotel had been delinked. I am sure they went back to the Members opposite, yet they did not come forward with any further evidence to say that this hotel was delinked. They never told us it was delinked on September 22. They did not say that at all. They were going back to a letter some time in August that said that was the basis for their argument.

I will save that one for the next election campaign: Ministers make $47 million decisions without any documentation.

Mr. McDonald: I must say in my own defence that looking to protect myself was not a particularly high priority when it came to the decision making. Obviously, it apparently is with the Yukon Party government. Unfortunately, this is one project they are going to wear for a long time. If the Minister thinks this is not going to be part of the next election campaign, it is going to be front and centre in the next election campaign. I can tell the Minister that, even though he may come and visit us once again, sitting in the gallery, we will still acknowledge him for his time spent in this Legislature and some of the decisions he has made.

The latest gambit now is that it is the Taga Ku proponents' fault that they did not inform the Government Leader and the Ministers about something the judge once again understood to be taken for granted, given everything everybody was saying and doing. If it is not my fault, it is the Taga Ku proponents' fault; we have not yet heard that it may be Northwestel's fault, but I will give the Minister enough rope to hang himself on that if he wants to take it. Everybody but the Yukon Party. The Yukon Party made absolutely no error here, and we have all this fallout, all this devastation. Perhaps those from the Yukon Party do not think it is devastation at all. Maybe this is the normal course of business - who knows.

Chair: Is there further general debate?

Mr. Cable: I have one question. In view of this acrimonious debate that took place on the Taga Ku project, and the acrimonious public exchanges between the political parties, why did the Government Leader so unceremoniously dismiss the possibility of mediation when it was suggested to him, very shortly after the action started?

Hon. Mr. Ostashek: As I said, prior to our getting into litigation, we offered to bend over backward to make the project go ahead. As the Member for McIntyre-Takhini says, he was only talking to one of the proponents of the project. I did not hear any comments from the other proponents.

Mr. McDonald: We will be dealing with this at some length in the future, and I will be raising it on numerous occasions, even in this session. I am sure we will all be more than talked out on this subject by the time this sitting is over.

I have a few questions for the Minister on the revenue assumptions in the budget book, and I refer to page S-10 in the operation and maintenance estimates. I would like the Minister to give us some sense as to the rationale for each item.

Income tax is expected to rise by 10 percent, yet there are other revenue sources that are not expected to see such a marked increase.

Can the Minister run down the list of tax revenue line items and indicate to us the assumptions?

Hon. Mr. Ostashek: The income tax increase of $4,244,000 from $41,458,000 projected for 1994-95, comes to a total of $45,702,000 for 1995-96. We generally use federal government projections for the income tax figure but, as of yet, no such projections have been produced by Ottawa. Therefore, the increase is based on an estimate done by the Department of Finance.

Of the $4.2 million, $3.9 million - or a 12.5 percent change - is personal income tax, and it is attributable to the increased activity in Faro. Corporate income tax is also expected to increase, but by a modest three percent, or $301,000. This increase is attributable to an increase in economic activity.

The increase is smaller in relative terms, since there appears to be a lag in corporate taxes reflecting changes in the economic environment.

We are projecting an increase in fuel oil tax of almost $1 million for 1995-96 to yield $7.1 million as opposed to $6.2 million in the 1994-95 budget. That is also attributed to the reopening of the Faro mine.

Property taxes are expected to decline by $78,000, from $1,680,000 to $1,602,000. This decrease is due to the reduced assessment on the Faro mine because of its closure. When the mine becomes operational again, the assessment will increase.

Grant in lieu of property tax has an $8,000 increase, from $391,000 to $399,000. It is relatively stable because the federal government construction activity appears to be relatively small.

Insurance premium tax shows a relatively small but healthy three percent increase of $18,000. The startup of the Faro operation contributes only slightly to the increase. This is a fairly stable tax.

We are projecting an increase of five percent for tobacco tax of $300,000, from $5.5 million to $5.8 million in the 1995-96 fiscal year.

The growth in 1995-96 should be reasonably high, partly due to the startup of the Faro mine. This tax appears to be inelastic, in that it continues to grow despite the 1993-94 rate increases.

Regarding the liquor tax, there has been no change from the 1994-95 projection of $2,028.000. The Liquor Corporation predicts no changes in consumption from the 1995-96 fiscal year. Increased economic activity and the startup of the Faro mine should result in additional sales. It is expected that this will be offset by a slight decline in the per capita consumption, a trend that appears to be developing here and in many other areas in Canada.

The liquor profit will increase by $1.1 million from the 1994-95 projections. This is entirely due to the corporation spending far less in capital money in 1995-96 than it did in 1994-95. If it were not for this fact, no change in revenue would be shown.

Investment income has shown a 21 percent increase from $1,122,000 to $1,359,000, projected. This is largely due to the government having more cash available to invest as a result of balanced or surplus budgets. We also expect interest rates to be somewhat higher during the course of the 1995-96 fiscal year. This figure may be underbudgeted if the CIBC continues to operate its seven agencies, since savings resulting from that initiative were not factored into the budget. Firm knowledge of this state of events was not known at the time the budget was prepared.

Licence fees, registrations and permits have shown no significant change. They are at $4,271,000. Normal growth, and growth resulting from the reopening of the Faro mine are offset by a reduction, due to a one-time increase, which took place in 1994-95. Following that, in oil and gas, a decline of $200,000 from 1994-95, to $1.7 million, is based on industry estimates. The production volume in 1995-96 will be lower than it was in 1994-95.

There is no change in public utilities and the income tax transfer may from $550,000. It is normally based on federal estimates, and we have not received them from the federal government yet. We are, therefore, predicting no change. Since this is largely an in-and-out item, it has a relatively small impact on our surplus/deficit position.

Chair: Are Members prepared to take a brief recess at this time?

Some Hon. Members: Agreed.

Chair: We will take a brief recess.


Chair: I will now call Committee of the Whole to order. Is there further general debate on Bill No. 4?

Mr. McDonald: I have a few questions about the revenue page in the budget book.

First of all, in the grant in lieu of property tax line item, can the Minister tell us whether or not the policy has changed of paying a grant in lieu of property tax at the rate a municipality charges other like property owners in that municipality?

Hon. Mr. Ostashek: I am not sure if I remember correctly, but the grant in lieu of property tax line item on page S10 is the federal government paying us. Is the Member asking for a reply to some other place in the budget?

Mr. McDonald: I realize that this is a revenue page. I am asking a question about what the Yukon government pays to the municipalities. Does it pay a grant in lieu that is at precisely the same rate as other like-users inside the municipality?

Hon. Mr. Ostashek: I cannot say for sure. I believe that is the case, but the Member may want to ask that question of the Minister when we come to the appropriate department. I do not have that information right here. If the Member wants, I could probably get it.

Mr. McDonald: I could also ask the Minister responsible for Community and Transportation Services.

Can the Minister tell us whether or not there is a change anticipated in the profit margins that are determined by the Yukon Liquor Corporation?

Hon. Mr. Ostashek: My understanding is that there has not been any rebalancing done for next year.

Mr. McDonald: If the consumption is the same, can we then expect precisely the same revenue? There will be no attempt to increase profit margins within the Liquor Corporation?

Hon. Mr. Ostashek: I believe that is a correct assumption.

Mr. McDonald: Under investment income, it shows an increase to $1.3 million. Did the Minister indicate to us that the line item in Finance that refers to $150,000 for banking services was something that was going to be corrected? How do the two compare?

Hon. Mr. Ostashek: What I said in the notes that I gave to the Member opposite is that this line item was based on the new contract with the TD prior to our knowing that CIBC was going to retain seven agencies in the communities. So, we may have to come back with an adjustment in the order of an increase to revenues in the supplementary for the 1995-96 year.

Mr. McDonald: Obviously that invested income does not accrue to us, so I presume that it does not change our surplus deficit situation. With this kind of investment income, could the Minister tell us why there is a banking line item in Finance?

Hon. Mr. Ostashek: My understanding is that it is because they do not occur evenly throughout the year. While I am on banking services, in the O&M expenditures there is also a line item for banking services where $150,000 has been documented. That could change because of the CIBC situation.

Mr. McDonald: My memory is failing me. Can the Minister tell us, given that he has the advice beside him, when the banking line item was instituted in the budget? I am having trouble remembering.

Hon. Mr. Ostashek: I believe that the contract came into effect on November 1, 1994. While I am on my feet, I should clarify something. The deputy minister and I have been exchanging things, and I believe I said they expired in the year 2000. In fact, it will expire in 1999. It is a five-year contract.

Mr. McDonald: I was most interested in the banking line item. I realize we are jumping forward a little bit, but these two items are connected. It might be worthwhile to deal with it right now.

In Finance estimates, banking services shows an expenditure of $150,000. Why is that not covered under the compensating balance, as well?

Hon. Mr. Ostashek: I am sorry; I did not explain it clearly. The reason we have a line item of $150,000 for banking services is because, as the Member is aware, at the start of the year we will have a substantial sum of money, but there may be a period of time during the year when we will not have the compensating balance that will offset the cost of the banking services. That is the reason $150,000 was budgeted. Later on in the year, there may be times when the compensating balance will not cover the banking costs.

Mr. McDonald: Is that because the compensating balance is too low right now to accommodate the banking costs? I have seen a banking line item over the last couple of years, but prior to that I do not remember seeing an expenditure in this particular area. Can the Minister explain that?

Hon. Mr. Ostashek: We can go back to the Member's regime when there were huge surpluses and there was always enough money there for a compensating balance. As we said during debate the other night when we were talking about cashflow and compensating balances, we would feel comfortable if we had $15 million or $20 million in there all the time, as it would be enough of a compensating balance that we would not have any banking charges. I guess one could say that the department is being conservative by budgeting $150,000 for banking services, but at the time the budget was put together, because of the CIBC situation, we did not know what all the costs would be. With the new TD contract and the increase in interest rates right now, our compensating balance will not have to be that large. The other day we said that a $10 million to $15 million compensating balance would offset any bank charges.

Mr. McDonald: For the balance of the fiscal year, what kind of compensating balance does the government anticipate?

As far as a surplus deficit situation, it appears that there will be some cash. Is the government saying that, for the fiscal year, it will not have a sufficient compensating balance, and this will end up as an expenditure of $150,000?

Hon. Mr. Ostashek: We are saying that it could happen in some months. This balance has to be maintained through the entire month in order to get credit for it. There are times when we have to draw our account down, especially on April 1 when we begin paying all the municipal grants and so on. A huge amount of money flows out of the coffers. There may be some months in which we will not have a large enough compensating balance.

Overall, we believe that it will be all right, based on what we know now. However, when we put the budget together, we were compensating for that by allowing $150,000 for those months in which we may not have enough in the compensating balance. Those would have been based on the interest rate at the time and the normal costs at that time, which still included the same agencies that CIBC has now decided to keep.

Mr. McDonald: Obviously the $150,000 may be turned back at some point in the future.

The revenue for the sale of lots is listed as being "zero". What does that mean?

Hon. Mr. Ostashek: That represents the profit on the sale of lots. As the Member opposite is aware, the government policy is to sell the lots at cost. Therefore, we do not see a profit from the sale of lots. That is why it is at zero.

Mr. McDonald: If the policy is only that no profit would be made at any time, what is the reason for requiring revenue figures in this area in 1993-94 and 1994-95?

Hon. Mr. Ostashek: My understanding is that sometimes there is an adjustment in the lot prices based on factors in the marketplace. This may in fact show a small profit to the government. That is why the line item is included.

Mr. McDonald: As I understand the land pricing policy, it is development cost or market value when it comes to residential lots, whichever one is higher. It suggests that in 1993-94 there were fairly aggressive sales. This current year, we expect very limited sales. Is it the assumption that market value will be lower than development costs? Does it suggest that no lots are going to be sold? Can the government take as notice the assumptions that were taken into consideration when this zero figure was put forward?

Hon. Mr. Ostashek: I thank the Member for that. What we will do is take notice of it and bring back a full explanation for the Member.

Chair: There being no further debate on Bill No. 4, we will move on to Schedule A.

On Schedule A

Yukon Legislative Assembly

Chair: Is there any general debate on Yukon Legislative Assembly, operation and maintenance estimates 1995-96, page 1-5?

Hon. Mr. Ostashek: I just have some opening remarks. The budget proposed for Yukon Legislative Assembly for 1995-96 was approved for submission to the House by the Members Services Board at its meeting October 31, 1994. The operation and maintenance budget totals $2,922,000, which is a decrease of .3 percent, or $9,000, from the 1994-95 forecast of $2,931,000.

Explanations of the changes in this budget from 1994-95 to 1995-96 estimates on a program basis are as follows:

There is an ncrease of $25,000 in the legislative service program from the 1994-95 forecast of $1,602,000 to the 1995-96 estimates of $1,627,000 due to the following factors:

MLA pay and fringe benefits have been increased by $7,000 as a result of the reinstatement of the indexing of MLA indemnities and expense allowances. The increase, which will take effect on April 1, 1995, will be about 0.9 percent. Salaries payable to Ministers, Leaders, the Speaker and the deputy will not be changed. MLA travel has been increased by $3,000 to account for changes in the travel director's rates for per diems and for mileage.

Caucus support services has been increased by $1,000 due to additional funding required for the Yukon bonus payments. There has been no change from 1994-95 in the amount allocated to each caucus for research and secretarial services.

The budget for legislative committees has been reduced by $6,000 in areas of professional services and travel. The amount allocated to the CPA Yukon branch has been increased by $20,000 to cover the cost of hosting the 1996 presiding officers conference and the travel costs for delegates to the 1995 Canadian regional conference. The regional conference did not take place in 1994 because Canada hosted the CPA international conference.

The $452,000 shown in the estimates for the Legislative Assembly office program is a $1,000 increase over the 1994-95 forecast. The 1995-96 budget for the elections program is $113,000, which is $47,000 less than the 1994-95 forecast. This decrease is largely due to the funding for school council elections being cut by $41,000 because there will not be a general election of school councils in the 1995-96 fiscal year.

There is an increase of $12,000 from the 1994-95 forecast of $718,000 in the retirement allowances and death benefits program. To meet the requirements of the federal Income Tax Act, an actuarial evaluation of MLA pension plans must be done once every three years. There is $8,000 being budgeted in the 1995-96 fiscal estimates to cover the cost of the next evaluation, which is due by March 31, 1996. Also, an additional $4,000 is needed to cover an increase in liabilities of the plan resulting from an increase in the MLA indemnities and expense allowances.

That is the O&M budget. I have a couple of words on the capital budget. Would the Member like me to make them now? If not, I can wait until later.

The capital budget being proposed for the Yukon Legislative Assembly for 1995-96 is $20,000, which is an $11,000 increase over 1994-95. There is $17,000 of this budget to be allocated for the purchase of equipment that is outdated and no longer serviceable, and $3,000 is allocated for miscellaneous furniture expenses.

On Operation and Maintenance (Mains)

Mr. Penikett: Let me compliment the Government Leader on a spellbinding speech when presenting the estimates for the Legislative Assembly. I paid very careful attention to the text of his remarks and, as a result of the very artfully chosen wording and some of the particulars, I have a few questions.

Under the item on legislative services and MLA pay, I wonder if the Government Leader would indicate to the Committee, in dollar terms, exactly how much money the government saved by the two successive cuts in MLA pay that took place during the life of this Legislature?

Hon. Mr. Ostashek: I thank the Member for his question, but I do not have that figure on hand. I will get back to the Member.

Mr. Penikett: As the Government Leader knows, there are a number of Members from both sides of the House who are deeply upset with the way in which the second pay cut was executed. Their concern, of course, arose from the traditions in parliaments of such matters being the subjects of prior bi-partisan discussion. Should the Government Leader be contemplating further cuts at this time? Could I ask him what his intentions are with respect to the manner in which he would be proceeding with such items? Would he intend to proceed the way he did with the first cut, which was with consultation or the way he did with the second cut, which was without consultation?

Hon. Mr. Ostashek: We have heard the representation from the Members opposite and we will certainly take them into consideration if, for some unforeseen reason, we had to instill further cuts. At this point, there are no plans to do that.

Mr. Penikett: I note, from the Government Leader's remarks, that MLA travel has been increased by $2,000 to account for changes in the travel directive rights, per diems and for mileages. This is an issue of great concern to rural Members. The mechanics of the change have, from time to time, been a subject for concern by people who feel that we should not be linked to federal schedules, or for other automatic indexing on matters like travel directive rights, per diems and mileages. Could I ask the Government Leader if he would be prepared to express himself about the level of those per diems and mileage rights, and indicate how he feels about this small increase, which is, nonetheless, an increase, and is accounted for by a change in travel directive rights?

Hon. Mr. Ostashek: Unless we are prepared to make some changes, I do not think we have any ability to set different rates for our Members than what is set out under the collective bargaining. Each year, the per diems have to be increased by the cost-of-living index. I have not heard any of the Members complain that they were not getting enough for per diems or mileage. In my opinion, it is adequate to cover the expenses that Members incur.

Mr. Penikett: To the Government Leader's knowledge, has any Member indicated in any way that those amounts may be excessive?

Hon. Mr. Ostashek: On occasion I have had the odd Member indicate that they were very generous rates.

Mr. Penikett: I have a question on the next item, which is the caucus support services. It has been increased by a small amount - $1,000.

I think I am quoting the Government Leader correctly. I believe he said that there has been "no change for 1994-95 in the amounts allocated to each caucus for research and secretarial services". Is this the line that paid for the famous mid-term report, and would it be possible to get a breakdown of the expenses of that report for the Committee?

Hon. Mr. Ostashek: I think we already gave a breakdown, but if the Member wants one, we can certainly give him a breakdown of the cost of the mid-term report.

Mr. Penikett: Let me explain my interest. In some respects, particularly in terms of the formatting and the layout, the document looked as if it had been professionally prepared. My interest is in establishing whether the professional work on this document was done under the Legislative Assembly line or whether it was done under the Executive Council line, and whether it was done by the Cabinet communications officer or someone else. That is my reason for the interest in the breakdown of the expenses, which has not been covered by previous information.

Hon. Mr. Ostashek: I will make a note of that and get back to the Member.

Mr. Penikett: In the Committee notes there is a statement by the Government Leader to the effect that the budget for legislative committees has been reduced by $6,000 in areas of professional services and travel. I would be curious to know the general reason for that direction, and I will follow with a couple of specific inquiries about that line.

Hon. Mr. Ostashek: My understanding is that it reflects the experience of the last few years.

Mr. Penikett: Let me say that the experience of the last few years has been lacking in consistency - as my mother would say about pudding. Shortly after the election, we had significant expense with the Land Claims Committee traveling around the territory. Of course, that was a good idea. There has not been a lot of bipartisanship, or comradeship, or even consensus building in the House, and even the formerly bipartisan or non-partisan Public Accounts Committee has not met as regularly as it used to. However, there is a motion on the Order Paper for the Committee on Rules, Elections and Privileges to meet on a couple of questions, and I understand that there may be some willingness on both sides to have a number of issues considered by that Committee.

As well, there is the larger issue of the future of the Canadian Confederation, which has, a couple of times in my experience, been a matter of some thoughtful discussion - I say discussion, rather than debate, because it was not a particularly partisan discussion - by interested Members on both sides in Committees of the House. I hesitate to add that I am not recommending that now, but I asked the Government Leader some questions the other day about his willingness to have a debate about the future of our country, with the pending vote on sovereignty or separation in Quebec. With the tensions that may ensue, it is possible, without anticipating the outcome of such a debate, that there may be an appetite in the House for the Members to do some work in Committee on that question.

Could I ask the Government Leader, on behalf of the government, what its proclivity would be for such committee discussions and, if necessary, would the government be willing to spend something in excess of this amount if there was an appetite in the House for a more cooperative, multi-partisan, consensus-building kind of discussion, rather than the normally polarized debate during Question Period?

Hon. Mr. Ostashek: I guess that the short answer is yes, if that were the desire of the Members and they feel that more committee work is there, although it would depend on the amount of money that would be required. It would be a legitimate request for the supplementary to be brought forward with an increase to that portion of the budget.

Again, I would rather have budgets reflect realities. I believe that this is what the Legislative Assembly has done, in this case. This figure has come from past experience. However, that figure is not, by any means, carved in stone.

Mr. Penikett: I thank the Government Leader for his answer. Before I ask the next question, let me declare my interest, or my bias - as the Government Leader knows, I felt I was misled on the subject of the rules for decisions about who would attend parliamentary junkets. Can I ask the Government Leader if the rule requiring participants in these events to file a written report on their trip, I think, with the Clerk, has been observed by the recent beneficiaries of this travel?

Hon. Mr. Ostashek: My understanding is that I do not believe any reports have been filed for a couple of years, and it would be up to the Canadian Parliamentary Association if they were going to do that. I do not have any fixed opinion on it one way or the other.

Mr. Penikett: As I am sure all Members know, there is an increasing interest everywhere by citizens in what might be described as the extracurricular activities of parliamentarians. I wonder if the Government Leader might, at some point, entertain a representation for value-for-money audit by the Auditor General of this expenditure.

Hon. Mr. Ostashek: I think that is a legitimate request, if the Members of the House feel that we should. I have great difficulty with this subject, not so much our level, because we do not have a lot of perks - we do have a few - but this is a topic of intense debate in our country today and, if the Members feel that we should have a value-for-money audit, I would be receptive to that suggestion.

Mr. Penikett: I could be wrong, but I would be extremely surprised if the Government Leader were to hear a stampede of Members requesting such an audit. I wonder how he would respond if one Member asked for one.

Hon. Mr. Ostashek: Let me put it this way to the Member opposite: I would take it under serious consideration.

Mr. Penikett: I would like to move on to another item. The Government Leader indicated that there is a decrease in the item for school elections, due largely to the school elections occurring last year, and that there are no general elections for school councils anticipated in the coming budget year.

By consulting with the Chief Electoral Officer, whom we are honoured to have present with us today, could the Government Leader indicate to us whether or not there is a predictable cost associated with by-elections for school councils? Is there enough experience to be able to establish a predictable number? Is there enough experience yet to be able to anticipate how likely an event that is in the territory?

Hon. Mr. Ostashek: It is our understanding that there has been an agreement reached with the Minister of Education that positions would not be filled with by-elections this time. If that were to happen, by-elections appear to cost about one-half of a general election, which would be in the amount of about $25,000.

Mr. Penikett: That sounds like a very expensive by-election. It might cause the Minister of Education to question whether there might not be some more expeditious way of filling in vacancies in small communities. I do not know what rules operate for the elections, but I think Robert's Rules of Order permit bodies to fill vacancies within the ranks for an interim period between a resignation, or death, and the next election. I will not make a representation on that now.

I asked the Government Leader previously if any thought had been given to transferring this line to the Department of Education. I know that it makes no difference to the bottom line of the government as a whole, but it is a fact that the Department of Education lumbered the Clerk's office with this onerous responsibility of running school elections. It is a task that they do very well, but I wonder if the train of accountability might not be improved if the Minister of Education had to defend this expenditure, rather than the Government Leader.

Hon. Mr. Ostashek: We have not discussed it, but I would suggest that the Member opposite take it up with the Minister of Education when we get to his department. I tend to agree with the Member opposite. There may be better accountability if it was a line item in the Education budget. I am sure that the Member opposite will take that up with the Minister when we get to his department.

Mr. Penikett: I thank the Government Leader for his encouragement and support, and I thank him for support on the issue when I deal with the independent Member on that question.

On the question of retirement allowances and death benefits, we have $8,000 budgeted for the actuarial evaluation. As the Government Leader knows, I for one have had some questions in the past about the quality of the actuarial work. I understand perfectly the desire of government to do this work as cheaply as possible but decisions of some consequence flow from the evaluation of the pension fund. Does the Government Leader think the amount budgeted here is sufficient to give us a first-class evaluation?

Hon. Mr. Ostashek: The line item is in there for the evaluation. Once the Legislative Assembly goes to proposals, we will find out if it is a large enough amount to cover the cost of an actuary.

I have to agree with the Member opposite. I have some concerns about evaluations on these. It seems that no matter when we do one we always find out that we are hundreds of thousands of dollars short in the budget. It is also an issue that is very front and centre in the eyes of the public. So, it is important that we do have faith in whomever is doing the evaluation for us.

Mr. Penikett: I thank the Government Leader for his comments. I feel obliged to comment that the typical pension plan here is the Subway sandwich type, not the steak and lobster option of the federal government. I wanted to make sure that that was clear.

On Capital (Mains)

Mr. Penikett: I will move on to a question in the capital budget. We have not had a lot of experience with a capital budget for this department; however, under that masterful mandarin, the Clerk, the capital budget will, no doubt, inexorably increase, something that happens in any department with a skilled administrator. I just wondered if the House could have a breakdown of the item in some detail.

Hon. Mr. Ostashek: Some of the larger items are the replacement of two computers: one for the assistant CEO and one to replace the computer for the independent Member's secretary. The largest item is the replacement of the copier in the Leader of the Official Opposition's office. The cost of that item is $10,000. Another $3,000 is for incidental furniture replacement.

Mr. Penikett: Just let me go on record as saying that both projects are thoroughly worthy. While, as a supporter of Yukon heritage, I have enjoyed using a pre-World War II copier for a number of years; having a new one will send us into absolute raptures of delight.

Chair: The time being 5:30, we will break until 7:30.


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

Is there further debate on the Yukon Legislative Assembly?

Mrs. Firth: When we were discussing this particular area before the break, the Leader of the Official Opposition asked the Government Leader to bring back some information about the mid-term report. I would like to ask him to bring some information back, as well.

I would like to know if the Government Leader could bring back for me a copy of the requisition that was sent from the Legislative Assembly Office to the Queen's Printer for the printing of this particular publication.

Hon. Mr. Ostashek: I will see if I can get that for the Member.

Chair: Are Members prepared to proceed line by line?

Some Hon. Members: Agreed.

On Operation and Maintenance (Mains)

On Legislative Services

On Legislative Assembly

Legislative Assembly in the amount of $1,112,000 agreed to

On Caucus Support Services

Caucus Support Services in the amount of $449,000 agreed to

On Legislative Committees

Legislative Committees in the amount of $22,000 agreed to

On Commonwealth Parliamentary Association

Commonwealth Parliamentary Association in the amount of $44,000 agreed to

Legislative Services in the amount of $1,627,000 agreed to

Chair: Is there any debate on Legislative Assembly Office?

On Legislative Assembly Office

On Activity

On Clerk's Office

Clerk's Office in the amount of $452,000 agreed to

Legislative Assembly Office in the amount of $452,000 agreed to

On Elections

On Chief Electoral Office

Mr. McDonald: Can the Minister tell us when we are going to have the next election? I know so many people who have been asking me and would like to pass on whatever good word the Minister has to offer.

Hon. Mr. Ostashek: I will make a commitment to the Member opposite that he will know when the rest of Yukoners do.

Mrs. Firth: I would like to follow up on that because I have brought forward an amendment to the Elections Act that is still sitting on the Order Paper requesting that the term of the election be a set term and that the election day be a set day. When I last debated this particular issue with the Government Leader, he indicated that he was somewhat interested in that initiative. What the purpose of the amendment to the Elections Act would be is that everyone in the Yukon would know when the next election was going to be. The date would be set, the month and the time. I would like to ask the Government Leader if he has given this any more consideration, if he still thinks it is a good idea, and when are we going to proceed with the amendment to the Election Act?

Hon. Mr. Ostashek: I have not given it any more thought. The only thing I can say is that, on the one hand, we keep hearing from the other side of the House that we should call the election now and put them out of their misery, and then we have the Member opposite proposing an amendment to the Elections Act, so the elections are held once every four years. In all seriousness, I have not given it any further thought, at this point.

Mrs. Firth: I do not think it is the Members on this side who are suffering the misery, but Yukoners may be somewhat disturbed. On occasion, I have a lot of Yukoners asking me when the next election is. Just about any time that I talk politics with someone they say, "When is the next election?"

This particular amendment has been on the Order Paper for well over a year now. I think it is in the best interest of all Yukoners to have a preset election day. I do not think that we would meet with a lot of objections here in the Legislature; I think it would make for some interesting debate. I think that then there would be some certainty, and we would not be speculating about when the next election would be. We would not have to be watching the government to see if they were hoarding and squirreling away money so that they could prepare for the next election campaign a year or two before the writ was expected to be dropped. We would know exactly when the writ was going to be dropped, and everyone would understand exactly where they stood with respect to when the next election would be.

In all seriousness, I would like to ask the Government Leader to look at it again. I anticipate having an opportunity to raise it in this sitting of the Legislature and perhaps debating the amendment.

Mr. Penikett: I do not think I should let the moment pass without indicating, for the record, the view of the Official Opposition on the question raised by Mrs. Firth.

As Members who were in the previous House will recall, the consultation documents in part 2 of the Public Government Act - the ill-fated Public Government Act which is having some of its assets stripped during this session - indicated that the previous government was open to the idea of a fixed election date. I believe, as I indicated to the Member during debate on this matter a couple of years ago, there are some significant problems with fixed election dates in the parliamentary system, especially if you have inherently unstable coalitions governing a jurisdiction. I believe these can be addressed. I think a fixed election date is certainly a subject that should be discussed, and I think we should be inviting public input.

Chair: Is there further debate on elections?

Chief Electoral Office in the amount of $104,000 agreed to

On Elections: Education Act

Elections: Education Act in the amount of $9,000 agreed to

On Elections Administration

Elections Administration in the amount of $1.00 agreed to

Elections in the amount of $113,000 agreed to

On Retirement Allowances and Death Benefits

Mr. Penikett: I just want to say now, before we get through all of the lines, that we did ask some questions earlier on which the Government Leader undertook to come back to us with information - the mid-term report and a couple of others - and I want to raise with you now, Mr. Chair, whether it would be appropriate to completely clear this department before we have those answers. We are quite willing to have it stood over, I believe.

Chair: Is there further debate?

Hon. Mr. Ostashek: Are the Members opposite saying that they want to stand the Legislative Assembly aside at this point?

Some Hon. Member: (Inaudible)

Hon. Mr. Ostashek: I do not know what this has to do with retirement allowances and death benefits.

Chair: Is it the wish of the Members to clear it and then just stand aside the total?

Mr. Penikett: What I was indicating is that we are quite happy to deal with this particular line, but before we finally clear the vote, I just wanted to indicate that we would like to stand it over until we get the answers to the questions.

Hon. Mr. Ostashek: I have no difficulty with that. We can clear the line. We do not have to clear the Legislative Assembly until we have the information.

On Retirement Allowances

Retirement Allowances in the amount of $730,000 stood over

On Death Benefits

Death Benefits in the amount of $1.00 agreed to

Retirement Allowances and Death Benefits in the amount of $730,000 agreed to

Hon. Mr. Ostashek: Point of order. Should we clear the capital first, and then just stand the department over until such time as we have the information back?

Legislative Assembly Operation and Maintenance (Mains) stood over

On Capital (Mains)

On Legislative Assembly Office

On Office Furniture, Equipment and Systems

Mr. Penikett: On the same point of order, the Government Leader mounted a passionate defence of the proposed capital expenditures and persuaded us that there are two fine items in there, the computer for Mrs. Firth and the copying machine for the Official Opposition, and we would be happy to clear that item now.

Mrs. Firth: I am not being touchy, but it is not really a computer for Mrs. Firth. When I heard the explanation from the Government Leader about this new computer for the secretary for the Independent Member, I immediately looked at the Clerk and asked if my secretary was getting a new computer. It was the first we had heard of it.

I just want to put on the record that the Clerk explained to me that there is some routine revolving program where, in case a computer breaks down or becomes outdated, the money will be in the budget for a new computer. Whether the secretary gets a new computer or not depends on whether we really need one and how short of cash we are. It is not a fait accompli yet.

Operation and Maintenance (Mains) stood over

Office Furniture, Equipment and Systems in the amount of $20,000 agreed to

Legislative Assembly Office in the amount of $20,000 agreed to

Legislative Assembly Capital (Mains) in the amount of $20,000 agreed to

Hon. Mr. Ostashek: Mr. Chair, I move you report progress on Bill No. 4.

Motion agreed to

Bill No. 3 - Third Appropriation Act, 1994-95 - continued

Executive Council Office

Chair: Is there any general debate?

Hon. Mr. Ostashek: The supplementary estimates for the Executive Council Office for the current year involve no increase in spending by the department. Approval is being sought to transfer funds in the amount of $98,000 from the department's 1994-95 operation and maintenance budget to its capital budget. The funds being transferred are used by two branches, the Bureau of French Language Services and the Bureau of Statistics. All funds are fully cost recoverable.

There is $25,000 being allocated by the Bureau of Statistics for computer purchases that will replace those that are now over seven years old. Because of their age, they are not capable of running specialized software programs that require great speed and large amounts of memory.

New machines that will be purchased will have greater speed and capability to work with numerous software. This will reduce the time required for data collection and analysis. The Bureau of Statistics is a highly automated operation, and effective computer equipment is key to its ability to carry out the basic statistical and research work of the branch.

Funds for these capital purchases are 100 percent recoverable from Statistics Canada, as the computers to be purchased support the work associated with the national labour force survey. In the Yukon, this work is currently performed by the Bureau of Statistics under contract to Statistics Canada. At the same time, the equipment is available for work on projects undertaken for Yukon government departments, so that this government, and the public it serves, also directly benefit.

Approval for the transfer for these funds is being sought at this time because negotiations on the contract with Statistics Canada were not completed at the time the main budget was discussed, which was last spring. Negotiations resulted in the Bureau of Statistics receiving all the funds it was seeking to support the labour force survey in 1994-95. These funds are currently accounted for in the bureau's current O&M budget. It was decided not to budget for capital purchases until it is known whether or not all the funds being negotiated would be realized and until decisions were made on how the funds would be allocated.

Since this has now occurred, the House is being asked to approve a transfer from the branch's O&M to the capital budget. Approval is also being asked for, in this supplementary, to transfer $73,000 from the O&M budget of the Bureau of French Language Services to its capital budget. This transfer is being requested at this time to provide an alternate use of funds that would not be expended on salaries in 1994-95. These unexpended funds result from positions within Justice, Community and Transportation Services and the bureau that were vacant for part of the current fiscal year.

The $73,000 will provide a computer network for the bureau, and access to other departments involved in the delivery of French language services, as well as the computers necessary to support this network. Funds to purchase interpretive equipment are also included in this total. It was decided to seek approval for the transfer of funds now, while they are available, because the addition of this capital equipment will support the long-term efficient delivery of French language services.

The computer network linking the bureau with other departments will allow for the electronic transmission of information, such as material to be translated or bilingual publications of forms to be proofed. Final products can also be transmitted electronically for the production or use by the requested departments. Electronic transmissions will then make up the time lost in transmitting paper documents and re-inputting information on the computer.

The interpretive equipment that will be purchased will eliminate the need to rent equipment when it is needed for French language trials or for other occasions where it is necessary for the bureau to offer interpretations from French to English, or English to French. As I indicated, these capital purchases are designed to support the long-term sustainability of French language services delivery within the Yukon government. This is particularly important, given the decrease in the level of federal funding with the current language agreement.

In closing, I would reiterate that these capital purchases do not involve any increase in spending within the Executive Council Office. At the same time, they support the effective operation of the department and the delivery of quality services to its clients.

Mr. Penikett: I would like to begin the discussion of the supplementary estimates in ECO by asking about some of the activities of the department during the year under consideration. My first question arises from the recent throne speech and budget debates. It concerns the role of the Executive Council Office in what I would call broader policy coordination, and the extent to which it was involved in the preparation of the two documents before the House.

My interest in this question is piqued by the observation that I made previously, to the effect that there are some commitments made in the throne speech that have no concrete manifestation in the budget. I do not want to repeat the throne speech or budget debates, but let me illustrate what I mean for the Government Leader.

We have talked previously about how land claims had slipped down the list to become number four on the priority list. This is the first time, since 1978, that it has not been number one in all of the years that I have been in this House. The new number-one priority says, "...balancing economic development and environmental protection". I use this as an example. If one looks at the budget documents, one sees that there is almost nothing in the way of commitment to that fine environmental objective, except a single phrase on page 14 of the budget highlights document, which says, "...continuing to work on the state of the environment report", which is, of course, an obligation created by the Environment Act and a project initiated by the previous government, not the present one. I am not inviting debate on that point; I use it as an example of my concern.

I want to ask the Government Leader this general question: how does the Executive Council Office operate in terms of policy co-ordination under his leadership? How does it co-ordinate the development of a throne speech and a budget document to ensure that there is some kind of policy consistency between the two documents and the legislation that comes from them?

Hon. Mr. Ostashek: The Executive Council Office reviews all of the materials that come from the various departments that make up the budget speech and the throne speech. A lot of the throne speech is written in the political offices by the principal secretary, but these are all reviewed by the Executive Council Office. It is the same with the budgets. We go to the departments for what they believe are their highlights. We put them all together and come up with a throne speech and budget speech.

Mr. Penikett: Given that, as I have pointed out, there are some commitments made in the throne speech to which there are no financial resources ascribed in the budget, and given that there are things in the budget that are hardly mentioned in the throne speech, could I ask who, in the present government, is principally responsible for making the two documents coherent. Is it the principal secretary the Government Leader just mentioned, or the Government Leader himself, or some other officer in the Executive Council Office? Perhaps the Government Leader could illustrate by explaining some things. Does the Cabinet office - and I do not mean the principal secretary but the senior officials in the Executive Council Office - get the chance to look at the budget before it is presented? Do the people in Finance get to look at the throne speech before it is presented? Who makes sure that the government is not saying one thing in the throne speech and doing something different in the budget?

Hon. Mr. Ostashek: I do not think we are doing anything different, or saying different things between the two documents. That is the Member opposite's interpretation and it is open to debate.

The budget document, as I said, is put together with input from all departments and it is not something that is reviewed by the Executive Council Office. They have to coordinate it all and get it together, and the budget speech is put together without any one department having a full idea of what is in the budget speech. The budget speech often highlights new spending. The throne speech, on the other hand, highlights priorities, which can often be accomplished within existing resources or may not be accomplished in the next fiscal year. The throne speech may not be for just a 12-month period.

Mr. Penikett: I wonder if I could ask if the Government Leader agrees with the proposition that if the government is to be seen to be speaking with one voice and if the government is to be clear about its priorities, there ought to be some logical links between the throne speech, the budget address, the budget document and the legislation that follows. In other words, if the throne speech serves the purpose that the Government Leader outlined for it, then the budget ought to be seen as a compatible companion piece, and indeed the legislation that follows ought to be seen as the natural progeny of - if I am not being too marital, or familial with my metaphor - the throne speech and the budget speech that preceded them.

Hon. Mr. Ostashek: As I have said, quite clearly that is the case. The throne speech does set out the priorities and the budget reflects some of the spending that will be required to bring those priorities to completion. While the budget speech may not have identified funding for entire projects, some of the things that are highlighted in the throne speech are multi-year projects.

Mr. Penikett: The Government Leader earlier said that my argument was debatable and I really do not know how much time we should spend debating it, but I invite him, in a quiet moment some evening, to take a look at the list on page 6 of the throne speech, which is a list of government priorities toward the year 2000, and go through them one by one, as I have done, and see if he can find any evidence of a financial commitment to some of those alleged priorities.

Even if everything the Government Leader has said is true about existing budgets being able to accommodate certain needs, or existing programs being able to meet certain projects, without going into it in great detail now, there is a real gap between the commitments made in the throne speech and the priorities that are evident in the budget. In fact, I think it would not take a very unkind person to argue that there is a different agenda here and indeed different priorities.

Rather than debating the particulars, as that is really a subject for the mains, I want to ask the Government Leader about the process by which they are developed.

The Government Leader has indicated that the principal secretary plays a role. He has indicated that he, himself, plays a role. He has indicated, also, that all departments have input into the budget; however, he has not explained exactly how the Executive Council Office functions here. Is there a person in the Executive Council Office, such as the Cabinet secretary, the ADM or some other officer who is principally responsible for policy coordination in this administration?

Hon. Mr. Ostashek: The policy is coordinated through the Executive Council Office and through the ADM responsible, in conjunction with Cabinet. Rather than get into a big debate on the throne speech or the budget, as we have already gone through them, I will say that these documents complement each other. They do not necessarily say it, word for word - and they should not - but they underline and set the stage for the legislative agenda, which is the policies and initiatives of the government.

Mr. Penikett: I agree with the Government Leader that now may not be the time to get into a debate about that point. However, let me ask him this: since I am one Member who perceives that there are significant contradictions between the two, let me ask the Government Leader what the process is, under his leadership, when a contradiction between what is in a draft throne speech and a draft budget becomes apparent. Who deals with that? Who vets both documents? Who brings it to the Government Leader's attention? What is the process when that happens?

Hon. Mr. Ostashek: The two documents are clearly separate documents; they were not even put together at the same time. I believe the throne speech was delivered on December 1, and the budget speech was delivered some two weeks later. Maybe the Member opposite is going to point out some glaring differences to me, but I have not seen any yet. I see that there are areas where Members opposite feel should have been funded with more commitment, and it is their prerogative to offer that criticism. I do not see the glaring discrepancies to which the Member opposite is alluding.

Mr. Penikett: I just said that I was not going to get into pointing out a lot of examples now. I will say, in kindness to the Government Leader, that I do not want to tie him up for hours by doing that. What I am asking here is really a process question. Let me just post a hypothetical example. The Government Leader, or somebody, and I am not clear whether it is the principal secretary, the Cabinet secretary, the Government Leader, or the assistant deputy minister that the Government Leader just mentioned, who receives a draft of a throne speech that hypothetically indicates that environmental protection, for example, is a huge priority for the government - perhaps even the number-one priority. Shortly thereafter, that same person receives a draft of the budget and the budget speech, which indicates that this priority of environmental protection has no new money attached to it at all. Who identifies that as an issue? Who brings it to the Government Leader's attention or to Cabinet's attention? What is the process? Who, in ECO, is responsible for that?

Hon. Mr. Ostashek: Nobody is specifically responsible for that. Both of these documents are reviewed by all of my Cabinet colleagues. In the case of the throne speech, for example, the departments provide a list of the policy initiatives, and those are coordinated through the Executive Council Office. The priorities are set and the throne speech is structured in the Cabinet offices. The production and review is coordinated between the Cabinet offices and the Executive Council Office. That is the way it is structured. The budget speech follows a similar process, where the departments put in their highlights, and the document then continues to be crafted in the Cabinet offices, as each of the departments are not aware of what the other departments have put forward.

Mr. Penikett: Of course, in this small jurisdiction the Government Leader has a unique role as a policy maker and as a coordinator of policy making, in that he is the Government Leader, First Minister and, of course, the Minister of Finance. Therefore, I need to ask him if he supports the policy and the practice that has been established over the last decade of ensuring that when one looks at a budget for any one department - and, indeed, if you are auditing the operations of the government at all - there is a clear hierarchy in terms of the activities of the government with the goals being clearly and boldly stated, that the objectives that follow under those goals clearly and logically follow from the goals, that the programs are clearly an expression of the objectives and that the activities under those programs also logically follow from the goals, objectives and programs. Does the Government Leader agree that the approach that has been enshrined - I guess, by two governments really well over the last 10 years - is a good practice and ought to continue?

Hon. Mr. Ostashek: Yes, it is a good practice and it is continuing.

Mr. Penikett: The Government Leader has indicated a certain lack of appetite for exploring the particular contradictions I am concerned about tonight. I will delay that pleasure for the good reason that I am really talking about things that are in the main estimates and not in the supplementaries. Let me ask the Government Leader one final question on this point: would he be concerned if Members of this House brought to his attention obvious contradictions between the words of the throne speech and the numbers contained in the budget?

Hon. Mr. Ostashek: Would I be concerned? I will wait until those representations are made, and then I will assess them as to how they are made and as to whether I believe they have any relevance. Then I will say whether or not I am concerned.

Mr. Penikett: Fair enough. Let me change the subject, then. The other night, we spent some time talking about devolution. At that time, I expressed the view that I thought it was a serious mistake in policy to put devolution ahead of land claims, as the Government Leader appeared to have done in at least one of his statements here. I pointed out that the rate of progress toward First Nation final agreements over the last couple of years suggests the real possibility that agreements with all 10 First Nations may not be reached in the time frame of three or four years that the federal Minister of Indian and Northern Affairs had set for the completion of devolution of provincial-type programs to the territorial government.

Also, on that occasion, we talked about the difficulties posed by the federal government's desire to cut the deficit while they were transferring programs, and I indicated my view that that difficulty might be exacerbated by statements from Whitehorse to the effect that the government was looking to perhaps profit from program transfers.

I want to ask, since the Government Leader has decided to have one person - a senior person - coordinate land claims and devolution talks, whether there is, in this government, a policy document of any kind indicating the government's approach to the coordination of these two major and very complex functions.

Hon. Mr. Ostashek: We are working in that area right now in speaking to the First Nations about how that relates to the land claims and the devolution.

The Member opposite seems to feel that it may not be proper for one person to be responsible for both those functions. I do not know what his rationale for that would be, as I think that the two are very closely linked. We have said that they complement one another. They are just as important to the First Nations as they are to the rest of Yukoners, especially with the direction the federal government is taking.

I believe that it is important that whoever is charged with those duties is fully aware of what is happening in both the land claims and devolution areas. As I have already said, there is a First Nations relations policy document that is being worked on now and is under internal review, which will address both land claims and devolution.

Mr. Penikett: The Government Leader has not articulated my position well at all, and that may be my fault. My basic view is that it will not profit us at all to gain devolution of everything, if we lose the land claim in the process. I do not at all disagree with the idea that these two policy areas should be coordinated. If one has an excellent public official available to do that work, well and good.

I have indicated in the past that, with no discredit to the individual involved, both jobs are full time and very difficult. It is my experience in government that the infinite complexities of the land claims negotiations, probably even at this stage where the legislation has passed Parliament, are such that no government will succeed in this work unless it devotes the time, energy, talent and intelligence of a lot of very good and very senior people to the project.

If the government tries to ride two horses at once, or tries to achieve both ends, it may find that it succeeds in neither. The reason I say that is because, even though I am not in official communication with CYI on this, my impression is that some First Nations are absolutely adamant that program transfers such as forestry, which affect the vital interests of their First Nation and their land base, will not occur until such a time as they have a final agreement.

If the Government Leader was in their shoes, he would probably well understand their position.

I would like to ask a specific question about the government's plan to bridge the gap between it and the First Nations on devolution. When we talked about this a few days ago, the Government Leader indicated that there had not been recent talks. A moment ago, he seemed to indicate that there had been some dialogue, perhaps in the last few days. Could he indicate what the government's plans are, without showing its hand completely, and what its strategy is to reconciling First Nations to his devolution agenda?

Hon. Mr. Ostashek: First I would like to make it quite clear that it is not only my devolution agenda, but it is a very high priority of the federal government. I do not know whether the Member opposite is aware of that, nor whether he has read the red book, but it is well stated in it that it is their priority to see devolution carried out very expediently. I believe the Prime Minister even went so far as to make a statement in Yellowknife shortly after being elected to the effect that he would like to see devolution completed in the north during his first mandate.

Last week, I said that the person responsible for devolution of land claims was going to Vancouver on the weekend to meet with officials from DIAND and the First Nations. The Member may not recall that statement, but that meeting did take place. We are in the process of trying to develop a memorandum of understanding on devolution. The memorandum of understanding will address the way in which devolution can proceed, while safeguarding and continuing with the priority of land claims. That will be the first step in the devolution process.

Regarding the Opposition Member's question on forestry, to my understanding this is a Kaska issue. We are working with CYI on devolution and have discussed forestry in that context. These issues are being addressed and we hope we will be successful in negotiating a memorandum of understanding that will give comfort to the First Nations, in that they will not see devolution as a threat to their land claims.

Mr. Penikett: Could I ask the Government Leader if the memorandum of understanding on devolution, which is under discussion, is proposed to be a document for two signatures or three?

Hon. Mr. Ostashek: I understand that it will be a document for three signatures.

Mr. Penikett: What happened to the memorandum of understanding on devolution that was under discussion between Canada and the Yukon last year?

Hon. Mr. Ostashek: A memorandum of understanding was worked out between officials prior to the election in Ottawa. That memorandum of understanding was never signed by the officials in Ottawa. I believe I signed it and sent it back to the responsible Minister at the time but with the election being called, we never did get that document completed.

Mr. Penikett: Is that the same memorandum of understanding that has been widely circulated in draft with a 1994 date on it?

Hon. Mr. Ostashek: I am not sure I can answer that. I am not sure to which document the Member is referring. The one I am referring to had some time lines and specific dates set out in it about when the transfers would take place. The document we are working on now is one that, as I have stated in this House before, was to accompany the devolution negotiations that we have been trying to establish for some time with First Nations people. So, I cannot be sure which document the Member opposite means.

Mr. Penikett: At some point, I do not recall exactly when, the Government Leader indicated to us that he signed a draft memorandum of understanding on devolution, and that it was on the Minister's desk. I believe that was some time in the calendar year 1994.

Can the Government Leader confirm for us that that was a document that was intended to be signed by the federal minister and himself?

Hon. Mr. Ostashek: No, I do not believe so. The document I am talking about is one that was negotiated in 1993. There was nothing done in 1994 on devolution.

Mr. Penikett: The Government Leader says there was a document negotiated in 1993 that had specific dates and schedules in it. Can I ask him if that 1993 document was intended to be signed by the Government Leader and the federal Minister of Indian and Northern Affairs?

Hon. Mr. Ostashek: It was intended to be signed by me and the former Minister of DIAND, the Hon. Mr. Siddon.

Mr. Penikett: That still does not explain why I have seen a memorandum of understanding, which is intended for the signature of the Minister opposite and the federal Minister, which is dated 1994.

Hon. Mr. Ostashek: My understanding is that some work was done to update the 1993 document internally, but it never did go anywhere.

Mr. Penikett: I am not suggesting that there was a conclusion. I am simply trying to establish that a document was drafted under the former administration, which was intended to be signed by the federal Minister of Indian and Northern Affairs and the Government Leader. The Government Leader has just now indicated that there may have been an update of that document intended for the signatures of the Government Leader and the Minister of Indian and Northern Affairs, which was never signed. Now, there is a new document under discussion as a result of the recent meetings in Vancouver. Is that correct?

Hon. Mr. Ostashek: Yes, that sums it up pretty well. As the Member opposite will recall, it was just about a year ago that the federal Minister of DIAND put devolution on hold pending the finalization of the first four First Nations final agreements. He held up the forestry transfer agreement at that point. There has been nothing done on devolution for a period of about nine or 10 months, and now we are getting started again.

Mr. Penikett: Would it be fair to say that the fact that the previous memorandum of understanding on devolution was intended only for the signatures of the Minister of Indian and Northern Affairs and the Government Leader, and the new document on devolution, which is intended for the signatures of the Chair of the Council for Yukon Indians, the Government of the Yukon and the Minister of Indian and Northern Affairs - a tripartite rather than a bipartite document - indicates a significant shift in policy by YTG, in that it is prepared to sign a tripartite document?

Hon. Mr. Ostashek: No, not at all. We have been trying for a long time to get a devolution process in place that was acceptable to the First Nations. The only reason that the Member may have a document that only required two signatures is that the Member will recall that the First Nations were not prepared to even recognize devolution at that point. The position that they were taking was that they would not even enter into discussions. As I just stated, the officials had a meeting in Vancouver over the weekend and have started discussions on a memorandum of understanding for devolution that will be signed by all three parties.

The document the Member opposite was talking about was a memorandum of understanding that was a scheduling document that set out some time lines as to when these things would take place. The new document I am talking about now is going to define the process and First Nation involvement in the process.

Mr. Penikett: I am still interested in whether there is a change in policy. From a First Nation point of view, I would be absolutely certain that they would say they had an interest in those questions of the timing of the transfers, not the least reason being that 10 of the First Nations have not completed their land selections and final agreements yet.

How close does the government feel it is to an agreement on this new memorandum of understanding? How long does the Government Leader think it will take to negotiate?

Hon. Mr. Ostashek: First of all, I want to say that I quite agree with the Member opposite that the First Nations should have had an extreme interest in devolution, but the position they were taking was that they were not going to recognize devolution and, therefore, would not enter into discussions at all.

In the meeting with the Chair of CYI and me in Ottawa last November, the Minister again made it quite clear that devolution was going to go ahead and encouraged the First Nations to participate in it. Now that the final touches are being put on the documents and the things the First Nations have to do to be able to expedite the claims settlement, they are now able to devote some resources to the memorandum of understanding question. My understanding is that we are aiming for a deadline of around the end of January to have a document put together on how devolution will proceed that will be acceptable to all three parties.

Mr. Penikett: Perhaps I am wrong, but it had been my impression that it was not that CYI did not recognize devolution, it was that they believed that they should have a right of veto over devolution of federal programs to YTG. Can I ask the Government Leader a three-part question? Does the federal government recognize the right of First Nations to veto the devolution? Has YTG changed its position on that matter? Thirdly, has the Council for Yukon Indians, in any measurable way, changed its position on that question?

Hon. Mr. Ostashek: The answer to the first two parts of the Member's question is no and no. On the third part, the parties are not focusing on and addressing the concerns of the First Nations, as to how to protect the land claims and the land claims process so that they will not be impacted upon by devolution. That is the approach that is being taken now, and the issue of veto is not being discussed at this point.

Chair: Is it the wish of the Members to take a brief recess at this time?

Some Hon. Members: Agreed.


Chair: I will now call Committee of the Whole to order. Is there further debate on Executive Council Office?

Mr. Penikett: Before the break, we were discussing negotiations between the Yukon government, the federal government and the Council for Yukon Indians toward a memorandum of understanding on devolution. The Government Leader suggested that the issue of a veto for First Nations over program transfers from the federal government to the Yukon government seems to have been set aside. Those were not his words, but that was the sense of the discussion.

Would the Government Leader agree that, on the question of a veto, either the Council for Yukon Indians or the federal and territorial government would have to change their positions on this question in order for there to be an agreement on a memorandum of understanding?

Hon. Mr. Ostashek: No, not at all.

Mr. Penikett: It is the view of the Government of the Yukon that, even if there was no movement on the question of a First Nation veto of a program transfer, a memorandum of understanding among the three parties is achievable. Is that correct?

Hon. Mr. Ostashek: That is correct.

Mr. Penikett: I would be interested in hearing a little more from the Government Leader about how he hopes to achieve that. Could he indicate to us something in the nature of the policy bridge that would close the gap between the parties on this question, so that the Government Leader's objectives in devolution could be achieved? Can he help us at all on that question?

Hon. Mr. Ostashek: The reason that the First Nations have always maintained the position that they must have a veto over devolution, even though the veto issue is not addressed in the umbrella final agreement, is because they were concerned about how to protect the land claims and the land claims process during, and as a result of, devolution. We are looking at the issue in terms of intergovernmental relations and as an exercise of respective government jurisdictions. I believe that we can come up with a process that will have full participation and input by First Nations, but will stop short of a veto.

Mr. Penikett: Is it not also true that, in some cases, First Nation governments have their eyes on some of the same programs that the YTG wants transferred to it, and that indeed there is another dimension to this problem, in that First Nations and the territorial government may be in competition in terms of the transfer of some aspects of federal programs, such as community health services, just to name one.

Hon. Mr. Ostashek: I disagree with the Member on that. I think those would be complementary processes and that they would not be in conflict at all. I believe that the issue can be addressed at the devolution table, as long as we have a good understanding and First Nations would feel comfortable that devolution will not jeopardize the land claims process.

Mr. Penikett: I must say that I am surprised with the Government Leader's answer, because it seems to indicate that things have changed radically from the time when I was in government - perhaps they have. I want to bore in on this question. Is the Government Leader saying that he knows of no case where the First Nations are interested in having transferred to them activities or programs of the federal government that the territorial government also seeks to have transferred to it?

Hon. Mr. Ostashek: I think we are talking about two different issues. We are talking about devolution of resources. There are two entirely different issues on the programs side. There certainly are areas that the First Nations are going to be interested in, and especially in the health field - in community health, as the Member opposite has said. I do not believe, however, that those areas are in conflict. I believe they are complementary to each other.

Mr. Penikett: I am sorry. I do not understand what the Government Leader is saying. What does he mean when he says that they are complementary to each other? It would be my hope, which is why we wrote the Health Act the way we did, that whatever happens in terms of land claims, self-government and devolution, on the ground in the communities First Nations and the non-aboriginal community will be able to work together, perhaps even sharing a common administrative structure in the delivery of some programs.

That is a different issue than the one about the federal program transfers. I think the Government Leader will understand that, in some cases, the federal government will be transferring programs to First Nations. In other cases, it will be transferring programs to the territorial governments. It should not surprise anyone if there is competition with respect to the resources in some of those programs. What does the Government Leader mean by saying that he thinks they are complementary processes?

Hon. Mr. Ostashek: I do not see a big issue of controversy in devolving some of the programs to the First Nations. Quite clearly, it is spelled out in the agreements that are negotiated that they can take over responsibly. If we look at the community health transfer process, which will involve both the Yukon government and the First Nations in the negotiations with Health Canada, some of the services will go to the Yukon government and some will go to First Nations. That will be part of the negotiations. I do not see it as competition to get our hands on federal government programs.

Mr. Penikett: It is my understanding that it depends very much on how it is done. To use the example just given by the Government Leader, if we were talking about the health centre and health services in Ross River, for example, the territorial government, which has clients in the area, may wish to have the facility transferred to it. The Kaska-Ross River Dena has clients in the area, and may wish to have it transferred to it. Right now, the federal facility serves both communities, and there could be competition. I would like to ask the Government Leader this: does he see a negotiation for such an item happening at the land claims and self-government table or does he see it happening at the separate devolution table?

Hon. Mr. Ostashek: It could be dealt with at the devolution table but, if not, we would have to deal with it at the self-government table. I do not think it is locked hard and fast into the devolution process. It could be dealt with under the self-government negotiations as well.

Mr. Penikett: Does the Government Leader not understand the problems from the First Nation point of view? If there is a prospect that the territorial government and the federal government are going to be meeting at a devolution table, at which the CYI is not present, to negotiate a matter in which they have an interest, surely the First Nations are going to insist that the matter be dealt with at the land claims and self-government table rather than at the devolution table at which they have no guaranteed role to play?

Hon. Mr. Ostashek: The Member opposite could be right about that, but at this point I do not see it as being a problem. We are not trying to make problems for ourselves; we are trying to solve problems. If we get a devolution process in place that is satisfactory to everybody, we will have eliminated a lot of the problems and anxieties of the First Nation people.

Mr. Penikett: Let me ask the crunch question: let me assume one possible scenario in which the First Nations do not agree to sign the memorandum of understanding that the Government Leader has just discussed. Do the territorial and federal governments intend to proceed with program transfers anyway, in the face of opposition from First Nations?

Hon. Mr. Ostashek: The Minister of DIAND made it quite clear to the Council for Yukon Indians and me at our meeting in November that the process would go ahead but that it would be better if the First Nations people were involved in it.

Mr. Penikett: I can only say that it seems to me that the Government Leader is inviting a lot of trouble. If he is saying that the First Nations are a part of the process, but they do not have the same standing or status as the other two governments, if they are the weak link and do not have the same power or resources, and so do not have the same ability to make a deal, they may feel quite frustrated and angry.

Since they may have abandoned the previous draft memorandum of understanding, which set out dates and schedules for transfers, whether or not they succeed in this trilateral memorandum of understanding about processes with First Nations, does the territorial government intend to try and reach another memorandum of understanding with the federal government, with or without First Nations, to set out a schedule for program transfers?

Hon. Mr. Ostashek: It would be premature at this point for me to say whether or not we are. Let us take it one step at a time. The first step is full involvement by First Nations people in the Yukon. That is the wish of the federal Minister, and it is also my wish. We are going to work very hard at getting a process of devolution in place that First Nations may not be entirely in agreement with, but that they will feel comfortable with. Once that process is in place, the senior coordinating committee will be looking at schedules if, in fact, we do establish those to follow the memorandum of understanding, and so it would be premature for me to comment on that at this point.

Mr. Penikett: We have established the obvious that, in respect to program devolution from the federal government, YTG has a veto. Obviously, if it does not agree, the program transfer is not going to happen. The federal government has a veto, because if they do not agree to the terms, nothing is going to happen. The First Nations are not going to have a veto, which raises the question of exactly what full involvement means.

I am not trying to play word games with the Government Leader, but it would be very useful if perhaps tomorrow the Government Leader, either orally or in a tabled document, indicate to us exactly what he means by full involvement, given that the power relationship is not equal - given that the two governments have a veto, but the First Nations are not going to be accorded one by the two governments.

Hon. Mr. Ostashek: I am not prepared to do that at this time - to jeopardize the negotiations that are going on with the First Nations. I think that would be counter-productive at this time.

I want to put on the record that the position of this government on the veto has not changed from the time the Member opposite was sitting on this side of the House. There is nothing new or spectacular about the position we are taking. It is a position governments in the Yukon have taken for some time on the question of the veto.

Mr. Penikett: I have never disputed that. I went to some length, some months ago, to point out that our government, and I in particular, had failed to close the gap in the land claims agreement in respect to the nature of consultations with First Nations, where we had indicated that there was going to be something more than consultation and something less than a veto, but we never defined exactly what that is.

That is why, in not a malicious or adversarial way at all, I am interested in what full involvement means. I invite the Government Leader to think about it and come back to us in writing. If he does not want to do that, that is fine, but would he at least take a minute to indicate to us something about what that might mean?

Hon. Mr. Ostashek: We have stated time and time again that we were prepared to use the model of the hospital transfer. That was the model we proposed to First Nations people. I do not think I have anything more to add at this point, until such time as we have something worked out with the First Nations.

That is the sort of process we are talking about.

Mr. Penikett: For the record, we are talking about the hospital transfer agreement, which was negotiated by the previous government. If my memory serves me correctly, it was a series of bilateral agreements among the three parties.

Hon. Mr. Ostashek: Whatever it was, it is a model by which we are prepared to work.

Mr. Penikett: Since the Government Leader has been cautious in his answer about a new memorandum of understanding between the federal and territorial government, which contains dates, deadlines and schedules, let me ask the Government Leader this: for the record, can he indicate whether or not the two governments - the federal and territorial governments - met any of the scheduled dates in the previous draft memorandum of understanding?

Hon. Mr. Ostashek: The previous draft memorandum of understanding never went into effect, as it was never signed.

Mr. Penikett: I do know that. What I am asking is, as a matter of historical fact, since the dates contained in the draft were, presumably, objectives that were shared by the two governments - whether or not it was signed - did any of the program transfers take place by the dates the governments intended?

Hon. Mr. Ostashek: Because the memorandum of understanding was never signed, there were never any further discussion on devolution. The first step had not been completed.

Mr. Penikett: That is a seriously flawed argument. My experience with the devolution memorandum of understanding was that some programs that were not even in the memorandum of understanding were transferred anyway. Others that were in the memorandum of understanding did not get transferred.

I made the point to the Government Leader the other day that the memorandum of understanding quickly turned out to be fiction very quickly.

Hon. Mr. Ostashek: The memorandum of understanding may turn out to be fiction, but the memorandum of understanding is quite specific. We are talking about lands, minerals and water. Those are still federal responsibilities.

Mr. Penikett: It was a bit hard to get the answer, but I got it eventually.

The other day, I was asking the Government Leader about forestry. He had publicly indicated some frustration with the federal government about the forestry talks. He said that the forestry transfer is on hold. He indicated at that time that he was going to be talking with the federal Minister. He was hesitant to say anything about the reasons for the breakdown of the talks, but indicated that he might, after talking to the federal Minister, be able to share with the House some of the concerns or reasons for the failure for the transfer to proceed. Can he do so now?

Hon. Mr. Ostashek: No, I cannot because I have not been able to touch base with the Minister of DIAND. After the news broke, he was trying to get in touch with me. He is back in his home riding, and we have had difficulty touching base with him. That call has not yet taken place.

Mr. Penikett: I appreciate that answer. Can I ask the Government Leader if he is prepared to give an undertaking, at some appropriate time after he has had communication with the federal Minister, that he would be able to report to the House by way of a ministerial statement, or some other device, so that we may know what to expect in terms of the forestry transfer and what reasons may have led to the delay?

Hon. Mr. Ostashek: I do not have any difficulty making that commitment. I will be making that information available at the appropriate time. At this point, I cannot say what time that will be.

Mr. Penikett: I would like to ask another general question on this point, which I am sure other Members will want to come back to. Has the Government of Yukon contemplated negotiating a memorandum of understanding on devolution with the affected federal employees bargaining agent?

Hon. Mr. Ostashek: No, we have not.

Mr. Penikett: Why not?

Hon. Mr. Ostashek: Quite clearly, they are federal employees, and that would be in the federal government's domain to appease them of what is happening at the devolution table.

Mr. Penikett: To use the Government Leader's word, I hope the territorial government has an interest in appeasing them, too. Let me point out, since the Government Leader has cited the hospital transfer as a precedent and a model that he would like to follow, does he realize that the previous territorial government spent some time and energy in trying to reach a memorandum of understanding with the federal employees of the hospital before they came to work for us? In fact, the reaching of a satisfactory agreement with them helped expedite the transfer.

Hon. Mr. Ostashek: In that light, yes. Once we have some idea of when the transfer is going to take place, we will be talking with the employees, but it would be premature to do that now.

Mr. Penikett: That is where I disagree because it was necessary for us to reach a memorandum of understanding with the employees before the acceptable terms for a transfer could take place. I am not turning that into a question, I am just stating it for the record.

Perhaps I could change subjects, since we are in general debate. Did the Government Leader have brought to his attention an article in the October 1994 issue of a magazine called Photo Life?

Hon. Mr. Ostashek: Not that I am aware of.

Mr. Penikett: I would like to quote from it briefly before I ask a couple of questions of policy. There is text that goes along with the article, which is entitled "Make 'Em Pay".

"It is hard enough to make a living as a photographer without competing with government freebies. Government tourism libraries steal bread from photographers' mouths by giving out images for nothing,'' says Julia Day below a million-dollar panorama, free for the asking, which is actually a photograph by a constituent of mine, Richard Hartmier.

The article begins by saying, "With 5,000 professional photographers and about 20 stock agencies all struggling to make a living, it seems ridiculous that there are 25 sources of free pictures in this country." Further in the article, she says, "Some libraries seem confused about the issue ...'' and then quotes an employee of the government photo library in Whitehorse who recently said that their pictures were, "not to be used for commercial gain but only to promote the Yukon''. Then the interviewer said, "So, would a major corporation like Canadian Airlines qualify?", and the government librarian said, "Yes, if they were producing a brochure." Then the interrogator said, "So pretty well anyone qualifies ..." and the government official said, "Yes, pretty well anyone.''

Mr. Hartmier is quoted again to the effect that in the Yukon Executive Council Office there are two government workers employed year-round and indicating that he complained about the situation. There is a quote that says, "A typical government response to my complaints is that because public funds have been spent to create these collections, the public should have the right to use them.''

"This is an entirely bogus argument," says Hartmier. "By the same token, I should have the right to use a government pickup truck or a computer or the services of a secretary." Following is a comparison of the day rates that are paid to photographers and the fact that libraries own world rights to photographs - sometimes exclusive rights - and use them in government publications, but they also make them available to other people.

Someone else, a Mr. David Barber, is quoted in here, who says that the problem is that the people making decisions do not know anything about photography.

Because this article contains quotes from a Yukoner, and perhaps even a supporter of the Members opposite, complaining about the free access that businesses and tourism agencies have to government photographs and the low rates the government pays to photographers for using their images, has the Government Leader had this issue brought to his attention, and did he agree with the concern or not? The Government Leader is grinning broadly.

Hon. Mr. Ostashek: I did not know how long we were going to go on with the review of this article. After the Member started getting into the details of it, I recalled the article but I did not recall the publication it was in. Yes, quite clearly, the person who is quoted in that article is a very vocal person, as the Member opposite is well aware, and he has made those concerns known not only to me but to several of my Ministers as well. I believe he may have some legitimate complaints. We are looking at them to see what we can do to rectify them.

Mr. Penikett: Let me say right off that I think the two government photographers have a wonderful job - I would like to have a job like that - but I also think they do extremely valuable work. What I am interested in is the nature of the government's response to this complaint. The Government Leader seems to be indicating that the government has not yet replied, or is examining it but has not communicated in writing directly to Mr. Hartmier, or perhaps even the author of the article. If the government has replied, could I ask if it would be prepared to table a response or replicate it in a tabled document. If it has not replied, would it be willing to share with the House the government's reaction when it is made?

Hon. Mr. Ostashek: I do not believe I will respond directly to that, because I do not believe there was even a written complaint about it. It was one of those complaints that you get on the street whenever you run into this person who is highly critical of the government photographers. Some of the departments now have a policy on how pictures are handled, but it is not a policy that is uniform throughout the government. I have asked our policy people to look at it and try to develop a clear policy for the government on the issue of photographs - how they are handled and who they should be made available to. Also, if we use photographs from a photo shoot that we have paid a private photographer to take on our behalf, does he still have some copyright to those pictures or has he signed away his copyright to the government? We are trying to develop a policy that will be compatible throughout the government, rather than across a couple of specific departments.

Mr. Penikett: This is obviously a matter that concerns the ECO more than anyone else. The Department of Tourism also may be involved, but the government photographers work for the ECO.

I would be extremely interested in seeing a statement of that government policy when it is ready. In the meantime, I wonder if it would be possible to table, in the House, the rates that are paid to photographers and the copyright fees that may be paid to photographers when we are making prints of their original work. Is there a rate schedule? If so, I would like to see it.

The reason I ask is that, in looking at this article, there is a huge variation in the rates paid by different jurisdictions. It would be interesting to me to see where we fit in.

Hon. Mr. Ostashek: I will check on that. Again, I am trying to recall things while on my feet, but I do not think that there is a consistent policy throughout the government on how much we pay for each photo. I know that, in some instances, we contract a photographer to do specific pictures. We have the contractor sign a release. I think this is probably the basis for this article. I believe that a situation like this occurred with this specific photographer. The government paid him a set amount of money to relinquish his copyright to the article. It appears now that he may be having second thoughts about that. That is the reason for asking people to come up with a good policy.

If there is a fee schedule in place in any department, I will try to make it available to the Member opposite.

Mr. Penikett: I should declare right away that I have an interest, not a conflict. I am interested in copyright matters.

I would be interested in knowing what the ECO pays. I would be interested in knowing something about the nature of the context the Government Leader just mentioned. I would be particularly interested in the question of whether or not, having contracted a photographer for the production of a certain work, there is any royalty or ongoing payment to photographers if there is a reproduction of their original work, beyond what was originally contracted.

I do not expect the Government Leader to answer that question on his feet, but it would be useful to see a written answer on it, if one could be made available.

Hon. Mr. Ostashek: Yes, we will get a written reply for the Member opposite.

Mr. Chair, it now being the time, I move that you report progress Bill No. 3.

Motion agreed to

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

Motion agreed to

Speaker resumes the Chair

Speaker: I will now call the House to order.

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

Mr. Abel: Committee of the Whole has discussed Bill No. 4, First Appropriation Act, 1995-96, and Bill No. 3, Third Appropriation Act, 1994-95, and directed me to report progress on them.

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

Some Hon. Members: Agreed.

Speaker: I declare the report carried.

Hon. Mr. Phillips: I move the House do now adjourn.

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

Motion agreed to

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

The House adjourned at 9:27 p.m.

The following Legislative Return was tabled January 16, 1995:


Sex offenders-options for treatment for adult offenders (Phillips)

Oral, Hansard, p. 358