Whitehorse, Yukon

Tuesday, January 24, 1995 - 1:30 p.m.

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

Prayers

DAILY ROUTINE

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

Are there any Returns or Documents for tabling?

TABLING RETURNS AND DOCUMENTS

Hon. Mr. Ostashek: I have a letter 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?

Are there any Statements by Ministers?

This then brings us to the Question Period.

QUESTION PERIOD

Question re: Greenhouse gases

Mr. Penikett: On December 13, the Economic Development Minister is quoted in Hansard as having said, "The whole question about C0₂ for the thermal use of coal for production is dependent upon the type of coal. My understanding, from the preliminary information we have received, is that the Division Mountain coal generating station has very low sulpfur levels, and hydro generation from that station will be less than diesel fuel."

Will the Minister now admit to the House that he confused C0₂ dioxide emissions with sulpfur emissions in that statement, and that, as a rule, coal emits 10 percent more C0₂ than does diesel fuel?

Hon. Mr. Fisher: I am not sure about the 10 percent, but the Member opposite is correct when he says that I was confusing C0₂ and S0₂.

Mr. Penikett: I thank the Minister for his response. According to CBC Radio, the Canadian climate action network report recently released states, "Global warming could wipe out whole species of animals, and destroy the arctic environment within this century." That is a fairly alarming prognosis. Since Canada has signed the United Nations framework convention on climate change, which compels us, by international law, to achieve "stabilization of greenhouse gas concentrations in the atmosphere at a level that would prevent dangerous interference with the climate system," can I ask if this Minister and this government took into consideration our legal obligations when they made their initial decision to support, in principle, the Division Mountain coal project?

Hon. Mr. Fisher: The initiative to come down to 1990 emission levels is going to be extremely difficult in Canada. In Yukon, interestingly enough, we are far below the required levels right now. However, if a couple of mines were to go into operation, we would be above those levels. This same problem exists in the rest of Canada. Interestingly enough, the rest of Canada continues to provide coal generation plants, but they are trying, through new technology, to lower levels of greenhouse gases.

Mr. Penikett: I thank the Minister for his answer. As he knows, atmospheric pollution respects no boundaries, regional or national. I am sure the Minister has been apprised of the fact that the federal Environment Minister, Sheila Copps, and the group of seven environmental ministers from the arctic nations plan to tour the region in May.

Was the Minister consulted about that tour? Is the Yukon on the agenda? Does the Government of Yukon intend to brief this delegation on the Division Mountain coal proposal at that time?

Hon. Mr. Fisher: There are a few questions there, and I will try my best to answer them.

I am not aware of that particular tour; however, the Canadian Council of Ministers of the Environment is meeting in Haines Junction in May. Possibly Ms. Copps is arranging the tour at the same time, but I am not sure of that.

We will be advising other environmental ministers on the possibility of the Division Mountain coal project.

Question re: Division Mountain coal project

Mr. McDonald: The Government Leader told Cash Resources, which has been doing feasibility work on the Division Mountain coal deposit, "In the event that your proposal is the most economic, environmentally sound one, our government is prepared to assist you with infrastructure and permitting for the plant and coal mine on a fast-track basis."

Does that mean that the government has agreed that there is a need for a large coal-fired generating station and is waiting for the best proposal?

Hon. Mr. Ostashek: The Yukon Energy Corporation is making projections on what additional power needs will be required if some of the projects on the horizon should come onstream. That analysis should be done shortly.

Also, the Yukon Development Corporation undertook a coal study, which the corporation is now reviewing and which should be available to the public in the near future.

Mr. McDonald: The Minister indicated that what he calls the study analysis on coal-fired generation should have been completed before Christmas. Can the Minister tell us when it will be tabled? Can he also tell us whether or not there has been a proposal call for a coal-fired electrical generating station, and can he tell me whether or not there is an interest from the mining sector to develop coal and produce more energy?

Hon. Mr. Ostashek: To my understanding, the report did arrive here right about Christmastime but I have not seen a copy of it yet. A detailed analysis of it is being conducted by the Development Corporation and the Energy Corporation. No, there has not been a proposal call at this time because we are waiting for the results of the coal study, and we are also waiting for the analysis of what size plant we should be planning, if in fact we go ahead with one.

Mr. McDonald: I am not entirely certain what the Minister mentioned in his letter of commitment to Cash Resources, but I will pursue that later.

Can the Minister tell us what he meant by providing fast- track support to Cash Resources once they submit economically and environmentally sound proposals? Is he of the view that we are in a hurry to increase our generating capacity?

Hon. Mr. Ostashek: That may indeed be the case, depending on the requirements. As the Member opposite is aware, with the Faro mine coming back onstream, we will be producing a substantial amount of electricity using diesel generation in winter months when we do not have the water flows to be able to produce enough electricity. So, yes, it is quite possible that it would have to move ahead fairly expeditiously.

Question re: Non-government organizations, funding for

Mr. Cable: I have some questions for the Minister of Economic Development on contributions to non-government organizations. I wrote to the Minister a little while ago, asking him to spell out who his department had funded. By way of a letter the other day, he indicated that three organizations - the Yukon Chamber of Commerce, the Yukon Chamber of Mines and the Klondike Placer Miners Association - had received funding from the Department of Economic Development to cover general expenses to enable those organizations to provide consultative services. Could the Minister clarify if the funding is fee-for-service funding or core funding?

Hon. Mr. Fisher: In the case of the KPMA, the funding was to assist it to respond to the federal government, through the processes that were going on, where it had to do a lot of consultation with federal government employees. That could not be classed as core funding, but it was to provide a service, essentially for the association. The funding for the Yukon Chamber of Mines is actually fee-for-service funding for certain publications, reports, and so on, that we receive from them. Although I am a little fuzzy on this one, I believe that the funding for the Yukon Chamber of Commerce goes toward the requirement for it to provide certain information to us.

Mr. Cable: Would the same rationale that applies to the Yukon Chamber of Commerce, the Yukon Chamber of Mines and the Klondike Placer Miners Association apply to other non-government organizations, such as the Yukon Agricultural Association?

Hon. Mr. Fisher: Yes it would, and we have a fee-for-service agreement with the Agricultural Association at this time.

Mr. Cable: Prior to the Economic Development department budget debate, would the Minister be good enough to table the three contracts with those three organizations we just discussed so that the Members of this House, on this side, can see what sort of services the government contemplates being eligible for fee-for-services funding.

Hon. Mr. Fisher: I will table whatever agreements are in place. This government did not make those agreements. The agreements were made under the previous government, so I am not sure if there is a contract in place or whether there is just a general letter of agreement, but I will dig into it and see I can find.

Question re: Deputy ministers, hiring of

Ms. Moorcroft: My question is for the Government Leader. Last night in the House the Government Leader admitted that his political advisors are involved in short listing candidates for the hiring of deputy ministers. This is an unprecedented, unethical and unprincipled practice. Will the Minister tell the House today that he will stop this practice immediately?

Hon. Mr. Ostashek: I went to some length last night, moreso than other Government Leaders have done in the past, to study the process that is involved in hiring deputy ministers. What we did was in line with other governments. Deputy ministers are cleared by the Public Service Commission for their qualifications to hold office. Ultimately, the Government Leader makes the appointment.

Ms. Moorcroft: What the Government Leader said last night is that the political staff are involved in the short listing of candidates. Does he not understand that this unprecedented deputy minister selection process by political staff amounts to the politicization of the public service at the highest level - at an unprecedented level?

Hon. Mr. Ostashek: I disagree with the Member opposite. I had my staff go through Hansard back to 1985, and I read about the same sort of debate in this Legislature in the past. In the answers of the former Government Leader, he refused to even talk about the number of applications that were received. I am going to take the same position now.

Ms. Moorcroft: It will not surprise people that the Minister is telling us that he is simply not going to answer questions; this has been his practice in the past.

How does the public know if political cronies are rejecting people for deputy ministers jobs on the basis of their political allegiances? What is the basis for political staff screening people out?

Hon. Mr. Ostashek: As I said, the deputy ministers are appointed from a list that is approved by the Public Service Commission. I do not recall any outgoing job description that stated that one must disclose his political philosophy before applying for the job.

Question re: Education, post-secondary funding cuts

Ms. Moorcroft: I have some questions for the Government Leader on another issue.

The Liberals are proposing to reform federal funding for post-secondary education in their social policy review by cutting funding to post-secondary educational institutions. This will lead to massive tuition fee hikes and will greatly reduce the operating grants to colleges and universities. I would like to ask the Government Leader whether the Yukon government supports this approach.

Hon. Mr. Ostashek: I would like to put on the record that we are very concerned about all of the rumours that are flying from Ottawa at this time. The rumour that the Member opposite mentioned is just one of many rumours being floated by the federal Liberals to see which the people will accept and which they will not accept - I call them trial balloons. I know that the Minister of Education is very concerned about it and is keeping a close eye on it.

Ms. Moorcroft: The Minister calls it a "trial balloon", but the discussion paper states that the Liberals are proposing a user-pay approach to social programs, including education. This is really going to discourage people from going to college by burdening them with loans, instead of making funding available to colleges and universities.

What is the Yukon government doing to oppose this approach?

Hon. Mr. Ostashek: It is sad that trial balloons are being floated. We have had no indication from the federal government as to what position they are going to take. We have a federal budget coming down some time near the end of February. In Ottawa, Mr. Axworthy and his colleagues in every department have been looking at ways to reduce the deficit. Yesterday there was an article in the Ottawa Citizen that said there are going to be 38,000 civil service employee jobs eliminated. These are all trial balloons that are being floated. Until such time as we know what they are proposing, it is very hard to deal with these trial balloons and we would only be shadow boxing if we were trying to defeat them. The Minister has raised his concerns; he has been in touch with the federal government about those issues. Once the dust has all cleared and we know what they are proposing, we will get into negotiation with them about it.

Ms. Moorcroft: It might be painful, but maybe the Government Leader should try reading some of the information that has been put out by the federal government about this. The Canadian students federation, and the local Yukon College student council are organizing a protest tomorrow, which will be a national strike against the education cuts. I have a list here of over 100 national and provincial organizations that are endorsing that. Will the Government Leader publicly state in the House today that he supports the Yukon students' plan to participate in the national students strike?

Hon. Mr. Ostashek: What seems to be painful is for the Member opposite to realize that there has, as yet, been nothing decided by the federal government. There are a lot of assumptions and a lot of alarmist statements out there. People are concerned about the cuts that are coming down. There are going to be some serious realignments, but until we know what they are, we cannot really influence anything. We can make our concerns known to Ottawa, and we have done that on numerous occasions. We have said that we must be treated in a fair and equitable manner. The Member opposite is also aware that there was another story a couple of days ago that stated they are going to transfer that responsibility to the provinces and territories and give them tax points or one-time funding to look after it. The federal government is looking at many different ways of handling post-secondary education and health and social services costs.

Question re: Education, post-secondary funding cuts

Ms. Moorcroft: I have a question for the Government Leader. He cannot just refuse to take a position until they have been hit with the cuts. I would like to know from the Government Leader where he stands. He is talking about alarmist statements but he is not willing to stand up and tell us just what he is prepared to do.

I will ask him this: will the Yukon government continue to fund Yukon College so that it can maintain its programs even if the Liberals cut off their support to post-secondary education?

Hon. Mr. Ostashek: That is a purely hypothetical question.

Ms. Moorcroft: I am sure the students and staff and administration at the college are going to be very interested to know that the question of whether this government supports Yukon College and the continued existence of post-secondary education here in the Yukon is a hypothetical one.

Can the Government Leader tell me whether his government would fund Yukon College as a post-secondary education facility if the Liberal government cuts off its support?

Hon. Mr. Ostashek: I do not believe hypothetical questions have to be answered in this Legislature.

We have taken a position that we appreciate the fiscal problems the Liberal government has in Ottawa, and we said we would work with the federal government but have to be treated in a fair and equitable manner - the same as all Canadians.

Ms. Moorcroft: Education is a right, and education is a very serious concern to this side of the House. Let me ask the Government Leader this simple question: will the Government Leader and the Minister of Education meet with the president of the college student council?

Hon. Mr. Ostashek: I will take that up with the Minister of Education when he gets back. I know that Cabinet is going to be briefed shortly by the president of the college.

Question re: Student assistance

Mr. Penikett: I have a constituent who is currently finishing her pre-veterinary training, but, as a straight A student, she was recently denied the Yukon slot at the University of Saskatchewan's Veterinary School of Medicine because she failed to meet the ridiculous requirement of having attended two years of high school in the Yukon. This student is now trying to raise the additional $17,000 it will cost to pay for the seat. I would like to ask the Government Leader, either in his capacity as Government Leader or acting Minister of Education, if he can please tell this House why this requirement, enacted by a previous Conservative government, continues to remain in effect. In addition, does he believe this requirement could withstand a court challenge under the Charter of Rights?

Hon. Mr. Ostashek: I am not aware of this particular case, but I find it very interesting that the Leader of the Official Opposition said that this was something that had been enacted by a previous Conservative government, when that Member was the leader of the government for seven and one-half years and did nothing to change it.

Mr. Penikett: We anticipated that we would have that kind of stupid remark, which is why we brought along the proposals that we made to change the rule, but that party on the other side of the House opposed -

Speaker: Order. I believe that "stupid" is an unparliamentary word in this House.

Mr. Penikett: Would it be acceptable for me to substitute the word "dumb", instead of "stupid"?

Speaker: I would prefer that the Members do not use that type of language in the House.

Mr. Penikett: Perhaps I will use the word "ill-considered" then. Can the Government Leader tell us why the totally unfair rule that limits Yukon grants to persons who attended high school here - while other life-long residents, who the government sent outside to attend high school cannot qualify - should apply to a qualified Yukon student, who wants to attend veterinary school in Saskatchewan, and is willing, if necessary, to pay her own way?

Hon. Mr. Ostashek: I do not know why, but I will take that under advisement and we will look into it. As I said to the Member opposite, the first I heard about it is today.

Mr. Penikett: Let me ask the Government Leader an intergovernmental relations question. The University of Saskatchewan has an agreement with the four western provinces to provide limited seating in the Veterinary School of Medicine, the only one in western Canada.

Each province agrees to abide by the residency requirements set out by the university, which are quite reasonable, including that a student is 19 years of age, the student has resided in the province or territory for 12 consecutive months, and the student be at least one year out of high school. Why then has the Yukon government, with one seat reserved in this program, declined to enter into a formal agreement with the university, thus eliminating all but the select portion of Yukon students - the few who benefit from the existing rule - and the many who do not.

Hon. Mr. Ostashek: Quite clearly, again, I do not have an answer for the Member opposite, but I will take it under advisement and see that we get him an answer.

Question re: Xerox, travel contribution

Mrs. Firth: I have a question for the Minister responsible for Government Services. It has come to my attention that three employees from his department, the Department of Government Services, went to Toronto at the invitation of a company that bids on contracts and supplies office equipment to the government. All the expenses for the trip were paid for by the company and the Minister authorized this travel. Why did he allow this?

Hon. Mr. Nordling: I believe the offer was made by Xerox, which supplies a lot of government equipment. They offered to show us the technology that they had so that we would be more informed in our purchases. They offered to provide the airfare and expenses for those individuals to go and they went.

Mrs. Firth: I think this is an unfair and unethical practice, and I think it creates an unfair, competitive advantage for a business. These employees were getting their wages while they were being lobbied and having an all-expense-paid trip to Toronto, paid by a company.

I would like to ask the government if it is its policy - obviously it is - to condone this kind of activity. It is now going to be the business that can dig deepest into its pockets and provide the best kind of gratuitous services that is going to have some kind of advantage with the government.

Hon. Mr. Nordling: That is not true at all.

Mrs. Firth: Of course it is true. This government not only authorized it, but now condones it. Is the Minister now going to encourage it? It is completely unfair and unethical. It stinks. The contracting industry is very, very unhappy with this.

I would like to know if this is going to become the common practice of this government. I would also like to know how many times this government has condoned and approved this kind of activity.

Hon. Mr. Nordling: It is not going to become a common practice. I believe that this is the only time it has occurred. If the opportunity arises again, it will be considered on a case-by-case basis, depending on the circumstances.

Question re: Xerox, travel contribution

Mrs. Firth: Surely this Minister, of all people, does not agree with this kind of approach. Surely he can appreciate and understand the unfairness and unethical nature of this practice.

Had the government sent these individuals out, at government expense, to review some new technology, and provided the same opportunity for all the businesses that do this kind of work with government, perhaps it could have been considered legitimate. That is not what happened here.

Speaker: Order. Will the Member please ask a question.

Mrs. Firth: Yes, I will. In this instance, there was a group of public servants on an all-expense-paid trip. I would like to ask the Minister of Government Services if he will stand up today and make a commitment that this kind of unfair practice will stop immediately.

Hon. Mr. Nordling: Yes, I will make that commitment. If there is any possibility that this type of activity will unfairly affect competition or prejudice other suppliers, it will not happen again.

Mrs. Firth: Does the Minister not see that it has already happened? Other businesses have already been unfairly compromised because one business was given the opportunity to provide government employees with information, without the other businesses having the same chance to have their equipment and purchases reviewed. The government employees we are talking about are probably influential in hundreds of thousands of dollars worth of government business and office equipment purchases.

Hon. Mr. Nordling: Yes, I do understand the concern and the appearance that that may take place. In this instance, I was told that they were the only supplier that had that type of equipment and that there were no other competitors that would be able to show us that kind of technology. I do understand and accept the Member's concern about appearances, and I do not see that happening again.

Mrs. Firth: I just want to clarify the record. The Minister originally stood up and said that he would consider it on a case-by-case basis. He is now saying that he does not think he wants to see it happen again. Can he give us a clear statement of what the policy is going to be? My preference would be that this not happen again, period; not that it be considered on a case-by-case basis, but that this practice stop immediately.

Hon. Mr. Nordling: That would be my preference too, but I do not want to rule out a government employee traveling for the purpose of being updated on new technology, if it is paid for by anyone other than government. I do understand her concern.

Question re: Statistics, retail sales

Mr. Cable: I have some questions for the Government Leader on the retail sales statistics. The statistics that were just released indicate that retail sales in the Yukon for November are down 6.1 percent, yet they are up in the rest of Canada to the tune of 7.1 percent. That would appear to have been the record for the year up until November 1994, where the year to date in November 1994 was down 4.2 percent.

I know the Government Leader has vigorously defended his government's record in the economic area when under attack from this side of the House by quoting retail sales statistics. Now that they are down, and have been down for the better part of a year, what does the Government Leader derive from those statistics?

Hon. Mr. Ostashek: The Member opposite is quite right. Retail sales are down, but I believe a contributing factor is that the population of the Yukon is also down.

Mr. Cable: It has come to my attention from somebody who was speaking to me this morning that three small businesses are now being liquidated in the City of Whitehorse. Does the government keep records relating to business liquidations and closures?

Hon. Mr. Ostashek: That may have been better directed to the Minister of Economic Development. I do not know if it does or not.

Mr. Cable: There is some suggestion that, due to the negative aura this government has cast over the Yukon for the last couple of years, people are saving rather than spending, which may be one of the reasons for the drop in retail sales. Does the Government Leader have any idea whether the savings rate has gone up or down in the last year?

Hon. Mr. Ostashek: No, I do not know if the savings rate has gone up or down in the last year, but I think most of that negative aura has come from the Opposition benches, not from the government benches.

Question re: Arctic National Wildlife Refuge, oil development

Ms. Commodore:

Yesterday I asked the Government Leader what the Yukon Party government's position was on environmentally responsible oil development in the Arctic National Wildlife Refuge. I ask these questions again today on behalf of some residents of Old Crow.

Will he please state the Yukon Party government's position on ANWR for the record in this House today?

Hon. Mr. Ostashek: I thought I stated it yesterday. The Yukon government is committed to the protection of the Porcupine caribou herd because of its importance to the Gwitchin people. We have said that time and time again. In fact, as I said in the House yesterday, we had a memorandum of understanding with Governor Hickel and, if the Member would refer to the press releases on meetings we had here, Mr. Hickel stated quite clearly that if the Porcupine caribou herd was going to be impacted upon, development would not go ahead.

Ms. Commodore: I thank the Government Leader very much for that response. Of course, that is not what he said yesterday.

Yesterday the Government Leader also told this House that a letter had been sent to Governor Knowles regarding a meeting about the Alaska National Wildlife Refuge to be held some time in the near future. Would the Government Leader table a copy of the letter today, and assure this House that the Member of the Legislative Assembly and Chief of Vuntut Gwitchin will be present at the meetings with Governor Knowles when he meets with them?

Hon. Mr. Ostashek: We are not in the habit of tabling all correspondence in this House. I stated my concerns in that letter about the ANWR and his position about the development of ANWR, and said I hoped that would be one of the topics that we would be discussing when I travelled to Juneau to meet with the governor.

Ms. Commodore: The answer is no - is that correct? We know that the Government Leader and most of the Members of his Cabinet will be visiting Old Crow on Friday and meeting with the chief and council regarding ANWR and other things. Will the Government Leader table a position paper that will be used for the meeting with Governor Knowles, based on the discussions with the chief and Member for Vuntut Gwitchin that will take place early next week?

Hon. Mr. Ostashek: I will take that under advisement. We will be discussing it with the Vuntut Gwitchin people in Old Crow at our meeting, and I am sure that those concerns will be thoroughly debated.

Question re: Land availability

Mr. McDonald: I have a question for the Minister of Community and Transportation Services. Yesterday I raised the issue of the development of low-cost land within the City of Whitehorse, and the Minister indicated that a committee had been set up a couple of weeks ago and was going to be working on it. I know the Minister knows that I am not going to take that answer as his final word, because any suggestion that we should simply wait for a committee is not acceptable.

Given that the Minister of Community and Transportation Services indicated last year that the government would be holding discussions with the City of Whitehorse about the development of low-cost land, can the Minister tell us why those discussions did not take place?

Hon. Mr. Brewster: I was not the Minister last year, so I cannot answer that.

Mr. McDonald: That is not really an acceptable answer. He was a Member of the same Cabinet in the same government. They shuffled the chairs, but presumably the government policy remains the same, and commitments are in place. We do not have to repeat all requests for commitments. Can the Minister tell us why the discussions did not take place? More than half a year has passed since the commitment was made.

Hon. Mr. Fisher: I was the Minister of Community and Transportation Services at the time. Some meetings have taken place with the city council on what the Member opposite was speaking of yesterday, that being the whole question of low-cost land for certain trailers.

The other question the council was grappling with was determining how these trailers could be moved and still meet certain building and electrical codes. It is a big problem. The previous city council and our department were working on it. I am not sure how far they got or if they came up with any solutions.

Mr. McDonald: On behalf of the Minister, I would like to thank the previous Minister for the briefing.

The Minister did not seem to be aware of those meetings yesterday. Why is there no money in the budget for low-cost land within the City of Whitehorse? There is approximately $11 million this year and $8 million slated for next year for residential land development. Why is there no low-cost land?

Hon. Mr. Brewster: One reason is that no one has been able to make a decision to get through all the problems. We have to make the lots smaller, which does not please the fire department. That would give one a cheaper lot, but if one went with the standard lot and the required distance between trailers, one would have to pay the development cost.

Speaker: The time for Question Period has now elapsed.

Notice of Government Private Members' Business

Hon. Mr. Fisher: Pursuant to Standing Order 14.2(7), I would like to inform the House that the Government Private Members do not wish to identify any items to be called on Wednesday, January 25, 1995, under the heading of Government Private Members' Business.

Speaker: We will proceed to Orders of the Day.

ORDERS OF THE DAY

Hon. Mr. Fisher: I move that the Speaker do now leave the Chair and the House resolve into Committee of the Whole.

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

Motion agreed to

Speaker leaves the Chair

COMMITTEE OF THE WHOLE

Chair: I will now call Committee of the Whole to order. Is it the wish of the Committee to take a brief recess?

Some Hon. Members: Agreed.

Chair: We will take a brief recess.

Recess

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

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

Executive Council Office - continued

Chair: We are dealing with Bill No. 4, and we are on Executive Council Office. We have concluded the general debate on O&M. Is there further debate on the policy and communications branch?

Hon. Mr. Ostashek: Just before we get into policy and communications, when we left the Legislative Assembly Office, we did not clear it because the Members opposite wanted one more document with respect to the cuts to MLA pay and what savings were contributed to government. I do have that for distribution now and, possibly, at the end of debate on clearing these departments, we can go back and clear the Legislative Assembly Office.

Mr. Penikett: It would be generally agreeable to the critic. I have not seen the document yet, but I would obviously be seeking confirmation that the general effect of the two successive pay cuts amounted to something like a 10-percent cut, and that that cut will continue in perpetuity, which will have an effect on future earnings and, obviously, pensions. That may not be calculated, but I am not asking the government to calculate that because it would be too big a number.

Hon. Mr. Ostashek: Once the Member has the document and we move back to discussing the Legislative Assembly Office, I can probably clarify any concerns that he raises.

Chair: Is there further debate on policy and communications?

On Policy and Communications - continued

Hon. Mr. Ostashek: In the debate last night, there was a question asked about the priorities of the policy and communications branch for 1994-95 and 1995-96. I have copies of them now that I can read into the record, if it is agreeable to the Member opposite.

For 1994-95 there would be the following: intergovernmental support for the Western Premiers Conference; annual premiers Asian trip; community tours and federal relations; policy support for development of legislation; access to information; conflict of interest; special projects; resource management; advertising review; gambling review; Secretariat for the Yukon Council on the Economy and the Environment and Yukon Health and Social Services Council.

For 1995-96, in addition to the carry over from 1994-95, there would be the following: support government/intergovernmental relations for participation in western premiers and annual premiers meetings; federal and intergovernmental international relations, support chief devolution negotiators, support policy; provide policy support for development and implementation of relevant legislation in special projects and ongoing policy analysis of government priorities.

Mr. Penikett: I thank the Government Leader for the answer. I may have missed some of that. That document is going to be tabled as well, is it not? I am just not sure I heard it all when it was read.

Chair: Is there further debate on policy and communications?

Ms. Moorcroft: I have a question for the Government Leader, just following up on some of the issues we were discussing yesterday.

We had quite a go-around getting the government to provide us with an organization chart so that we could look at some of the changes within the department. We were asking about the devolution implementation coordinator reporting to the chief negotiator. The Government Leader made the statement that the devolution person will not be reporting to Mr. McTiernan and that government has not decided what it is going to do with that position but that it is not intended that the devolution person will answer to the chief land claims negotiator.

Can I ask the Government Leader whether the employee whose position was being discussed last night was informed of the intentions of the government before it was discussed in the House?

Hon. Mr. Ostashek: No. The employee is part of the policy and communications branch and that is where he remains. Whether or not his job title is changed is another issue, and that is what I said last night. That will be addressed as we go along with this process.

Ms. Moorcroft: I remember the discussion and I have also taken a look at the Hansard. What the Government Leader said was not that the job title would change but that who the position would report to would change. We have all kinds of problems with the way this government manages its personnel. It does not seem to understand some pretty important principles.

I did not ask the Government Leader whether or not an employee was informed of a change in their job title. I asked the Government Leader if the restructuring - and he referred to restructuring - was something that the employees are advised about before the planning was done.

Hon. Mr. Ostashek: The position has not been moved. I said that last night. It is part of the policy and communications branch and it is remaining there.

Ms. Moorcroft: The Government Leader does not even seem to understand what he has said. He said that the person is now working in policy and planning, which may be restructured and that it is not intended that he will answer to the chief land claims negotiator.

Does this government inform people in advance when they are planning restructuring?

Hon. Mr. Ostashek: When we get to the restructuring process, there will be meetings held with the people involved.

Mr. Penikett: I will not ask another question, because I do not want to delay discussion of this item. Suffice to say that I note that the Government Leader has given us a written report. I note the content of both.

From my point of view, this is a fairly thin agenda for a government that talked about an ambitious agenda at the start of the session. The 1994-95 priority projects list had a number of special projects listed. We have only heard a report on the gambling review. We have not heard anything on the records management or advertising review.

In the coming year, there will be ongoing intergovernmental work and support for the chief devolution negotiator. We also have a general statement about policy support for implementation of relevant legislation and special projects, none of which are detailed, and ongoing policy analysis of government priority projects. This is, of course, what one would expect.

I would like to make those comments at this time. I do not want to delay debate, but I want to indicate to the Government Leader that in the next budget or supplementary I will want to come back to this as an issue.

Chair: Is there further debate on policy and communications?

On Policy and Intergovernmental Relations

Policy and Intergovernmental Relations in the amount of $451,000 agreed to

On Communications

Communications in the amount of $519,000 agreed to

On Federal Relations Office

Federal Relations Office in the amount of $180,000 agreed to

Policy and Communications in the amount of $1,150,000 agreed to

On Aboriginal Language Services

Chair: Is there any debate on the aboriginal language services branch?

Hon. Mr. Ostashek: I have just a couple of highlights. The budget has decreased by $26,000, or two percent. The changes from last year's budget include a $32,000 increase in transfer payment for the aboriginal community initiatives program to support community-based language projects. There is a $40,000 decrease in personnel costs because of a vacancy in the language interpreter position in Ross River. There is an $18,000 decrease in other costs, including a reduction in the budget for outside travel and office space because of the vacancy in Ross River.

Chair: Is there any debate?

Mr. Joe: Can the Minister describe to us the aboriginal language program and how the money is being spent?

Hon. Mr. Ostashek: The money is to support community-based language initiatives aimed at maintenance and revitalization of Yukon aboriginal languages through the aboriginal languages community initiative program; the delivery of interpretive and other language services through language interpreters; continued focus on consultation and coordination of plans and activities with First Nations, CYI and other language stakeholders, including cooperative projects with stakeholders; continued development of language products, including language lessons, oral histories, media information, tapes, songs and legends in this regard, and the hiring of a linguist has strengthened the ability of the branch to deal with the written languages.

In the training and development of an interpreter, there have been training sessions. With respect to the training representative service, the expanded services offered include renewal of basic commercial motor vehicle licences, and we are investigating the capacity of CD-ROM to assist in language development revitalization.

Mr. Joe: We were talking about $1,180,000. The next question would be this: how many people in the bands are employed by aboriginal language services?

Hon. Mr. Ostashek: There are 11.5 positions in the branch, which is a reduction of one position from 1994-95, which is the interpretive position in Ross River. There are 6.5 language interpretive positions, including 5.5 in the following communities: Mayo, Pelly Crossing, Carmacks, Watson Lake, Teslin, and a half-time position in Beaver Creek. There are also one language interpreter and one linguist based in Whitehorse.

Basic territorial representative services are also offered by the language interpreters in Carmacks, Teslin and Beaver Creek. Basic services, including issuing hunting and fishing licences, providing job postings, tender notices, copies of statutes and regulations, and handling general inquiries about Yukon government programs and services, and certain motor vehicle services, such as licence renewals and vehicle registration.

Mr. Joe: Where does the interpretive program come in?

Hon. Mr. Ostashek: The interpretive program is part of the service that is delivered under the aboriginal languages program.

Mr. Joe: I would like a list of all the interpreters and where they work.

Hon. Mr. Ostashek: I think I already stated that, but I will say it again. There is one in Mayo, one in Pelly Crossing, one in Carmacks, one in Watson Lake, one in Teslin, and a half-time position in Beaver Creek.

Mr. Joe: Does all of the money for aboriginal language services come from the federal government?

Hon. Mr. Ostashek: Yes, all of the money under this department comes from the federal government.

Mr. Joe: Is the government doing anything to make sure that we do not lose money for aboriginal services after the Liberal budget comes down in February? I see that the O&M budget has gone down about $26,000. Why is that?

Hon. Mr. Ostashek: It has gone down $8,000. There is a small reduction in funds available under the current agreement, as well as the allocation of $18,000 to capital projects. What this all boils down to is that the federal government has made cuts of 12 percent to the program over the five-year period. I think that there are three years left in the agreement.

On Aboriginal Language Program

Aboriginal Language Program in the amount of $1,180,000 agreed to

Aboriginal Language Services in the amount of $1,180,000 agreed to

On French Language Services

Chair: Is there any debate on the French language services branch?

Hon. Mr. Ostashek: I will just give you a few of the budget highlights. There has been a $41,000 increase in the budget for the Bureau of French Language Services as a result of a decline in the capital requirements of the branch for 1995-96. Some of the key changes include a $27,000 increase in personnel funds, as a number of positions that were vacant have now been filled; full-year funding will be required for all positions. There is a $52,000 increase in the Other allotment to support the acquisition of French language materials for the library system and increased production of publications and signs. A decrease of $38,000 in transfer payments reflects decreased support to the Association of Franco-Yukonnais and the Yukon Hospital Corporation.

On French Language Program

French Language Program in the amount of $1,507,000 agreed to

French Language Services in the amount of $1,507,000 agreed to

On Bureau of Management Improvement

Mr. Penikett: This is another area where I had an outstanding question. The other day, I asked the Government Leader if he would be tabling any of the internal audit reports, as he had done in the first session after his election.

Hon. Mr. Ostashek: Yes, we will table whatever we have done. My assistant tells me that we should be able to table them tomorrow.

Mr. McDonald: I have some outstanding questions, too. The Minister is going to provide us with a list of the 14 projects that had been identified as providing the government with savings. He was also going to identify precisely what those savings were. Can the Minister do that now? This is, obviously, I think, the last moment we have to debate this line item.

Hon. Mr. Ostashek: We have gone back to the departments to have them calculate what the savings are, and I have not heard back from the departments yet. I will check on it during the break.

Mr. Penikett: Is there an audit plan for next year and may the Committee know that?

Hon. Mr. Ostashek: Work is underway to develop the work plan for 1995-96 for the Bureau of Management Improvement. A call letter has been issued to the departments and corporations to identify potential projects. The list will be reviewed by the Deputy Ministers Policy Review Committee and the Audit Committee before being submitted to Management Board for approval.

The 1995-96 work plan will be completed by the onset of the fiscal year.

Mr. Penikett: Could I ask for an undertaking that a copy of the work plan that is going through Management Board will be tabled when it has cleared the proper authorities? We could perhaps expedite discussion of this item if we just stand aside the bureau line until we get the audit information the Government Leader said we might be able to get tomorrow. I do not want to waste any more time discussing it now. We can just stand it over and move on to the next one.

Hon. Mr. Ostashek: I have no problem with that. Once the work plan is developed and approved by the Management Board, we will have it tabled. I have no difficulty standing this aside at this time.

Chair: Are we agreed?

Bureau of Management Improvement stood over

On Bureau of Statistics

Hon. Mr. Ostashek: I just want to list some highlights. The budget has been decreased by $182,000, or 19 percent. As I stated in my opening comments, as a result of a national survey, the survey on health and youth will not be carried out in this fiscal year.

Key changes are: $113,000 decrease in personnel costs that are not required for federally funded survey work, a decrease of $69,000 in travel costs and contract services, program materials and communication costs, and $178,000 decrease in recoveries from Statistics Canada.

Mr. Penikett: I thank the Government Leader for that explanation. Could I ask him if the methodology for calculating the part-time employment numbers and the problem I raised about whether there was any problem of definition between part-time and full-time work, as the economy increasingly generates part-time jobs rather than secure, full-time jobs, is available?

I concede that I did not ask for it to be delivered now. I said I wanted to get it by the time we debate Economic Development estimates, but I would like to ask if it is ready yet.

Hon. Mr. Ostashek: It is not ready yet, but it is being worked on.

Mr. Cable: Could the Government Leader indicate how statistical data, which is collected for other departments, is charged back to those departments? Is there some sort of formula or policy with regard to this?

Hon. Mr. Ostashek: The only charges to the departments are for incremental costs for additional staff that may be required to do the survey. The ongoing costs of the department are not calculated.

The cost of auxiliary on-call staff are borne either by recoverable funds - this is for work done by Statistics Canada - or by departments sponsoring a survey as incremental costs of the project.

Mr. Cable: The reason I ask is that the Member for Klondike, the Member for Whitehorse Centre and I are on the committee that has been struck for race relations. We have been talking about a survey, which is to be done by the statistics branch. The initial reaction we had was that it would be fairly costly. I am wondering what are the costs that are incurred by the survey.

The survey being suggested is one on people's attitudes toward the land claims. Is it necessary that there be a large cost load attached to the survey?

Hon. Mr. Ostashek: First of all, the committee would discuss with the statistics branch what they want in the survey. The statistics branch will draw up the survey and estimate the costs associated with the project.

On Administration /Management

Administration /Management in the amount of $145,000 agreed to

On Information/Publications

Information/Publications in the amount of $166,000 agreed to

On Methodological Support Services

Methodological Support Services in the amount of $479,000 agreed to

Bureau of Statistics in the amount of $790,000 agreed to

On Office of the Commissioner

Chair: Is there any general debate?

Hon. Mr. Ostashek: The budget for this branch has been decreased by $5,000. Money budgeted in previous years to provide a temporary person to cover for the administrative assistant when she was on holiday has been deleted. Vacation relief will be provided by existing staff within the department.

The Yukon government pays for the office of support for the Commissioner and some operating expenses.

Mr. Penikett: As the Government Leader knows, given some of the antics of the Royal Family, there has been an outbreak of Republicanism everywhere in the English-speaking world. What is the Government Leader's view of the continuing utility of the Office of the Commissioner? Rather than getting into a long philosophical debate about this question, has the Government Leader given any thought to the future of the job of Commissioner in the sense that I understand the incumbent is shortly to leave the office and there will be a new Commissioner? Has the Government Leader had cause to reflect on whether or not this needs to be a full-time job, with staff and a large travel budget, or whether it might not be done by some other respected senior citizen on either a piece-work or part-time basis?

Hon. Mr. Ostashek: In simple terms, no, I have given it no thought.

Mrs. Firth: Before we pass this, I have a question for the Government Leader. It is no secret that we will probably have a new Commissioner appointed by the federal Liberal government. Has the Government Leader been asked by anyone from the federal government if he had any recommendations of individuals who might fill this role?

Hon. Mr. Ostashek: That might better be directed to the lone Liberal in the House.

I have talked to the federal Minister of DIAND about this position from time to time. The last I heard is that there has been no decision made on who will be appointed. We submitted some names to the Minister for his consideration, and I believe there has been a call to all Yukoners to submit names for the Commissioner's job to our gracious Senator.

Mrs. Firth: I did not receive a call from the Senator asking for names. I do not think that would surprise anyone, since the Senator was one of the people who was instrumental in blocking the doorway to the infamous meeting the federal Justice Minister had here. I do not think the Senator has ever been one of my greatest supporters or fans.

The Government Leader said that he has talked to the federal Minister about it and was asked to submit names. Could he tell us what names he submitted to the minister?

Hon. Mr. Ostashek: I will have to check into whether it is proper for me to release the names before I do so. I personally would not have any difficulty with it but there is some protocol involved, and I will have to check first.

Mr. Penikett: If he does not give us the names, would he tell us at least if there are any New Democrats on the list?

Hon. Mr. Ostashek: I am pleased to report that I believe the majority of them are New Democrats.

Mr. Penikett: There are six New Democrats, all of them sitting MLAs.

Mrs. Firth: I would look forward to hearing this. Perhaps the Government Leader, without stating the names, could tell us how many names he submitted? Would he be able to bring that information back to us today?

Hon. Mr. Ostashek: I do not know if I could bring the information back today, but I can tell the Member that I believe there were about four names - I am not sure exactly how many there were - and I can assure the Member that it was not a political list. It was a list of people we thought would be acceptable to all Yukoners.

Mrs. Firth: Is the Government Leader prepared to share some details with us, such as gender, for example. Of the four names submitted, how many were women?

Hon. Mr. Ostashek: I am not certain, but I know there were some women.

Mrs. Firth: It is starting to sound pretty shaky - four names, some are women, but he cannot remember. That does not give me a lot of confidence. Were any First Nations people recommended?

Hon. Mr. Ostashek: Since I am not prepared to get into the names at this time, what we are doing is cross-examining. I asked the Member to wait until I have checked to see if it is appropriate for me to table the names. If it is, I have no difficulty doing it, but I may have to consult with the federal Minister first. I do not know.

Office of the Commissioner in the amount of $119,000 agreed to

On Cabinet Offices

Hon. Mr. Ostashek: This budget has been decreased by $11,000, and that should cover the $5,000 amendment. The outside funding for ministerial travel has been cut by $30,000, reflecting the government's interest in keeping costs at a minimum. There is a total increase of $34,000 for personnel costs, which includes the salary for the director of research for a full year and additional personnel costs with merit increases to eligible Cabinet staff Members.

Mrs. Firth: The Minister was going to bring back some further information about the research director position. He said that it is now a contract position. That is the position that was formerly held by Mr. Ted Staffen. I have not received any information from him with respect to that particular issue.

Hon. Mr. Ostashek: I was mistaken. The person who is in that position now is on term until the end of March.

Mrs. Firth: It is a term position, then. Why was it put in as a term position?

Hon. Mr. Ostashek: This may have been an arrangement with the person in the position. I do not know what it was, and I do not think we should be discussing it on the floor of the Legislature. They are budgeting for a full year for that position, and we have the ability to fill it in any manner we wish, either with a term position, a full-time position, or a contract.

Mrs. Firth: I know that the government can do whatever it wants, but that does not mean that we cannot ask questions.

Some Hon. Member: (Inaudible)

Mrs. Firth: The Minister says that it is a personnel matter, but it is not. This was a new position that was created - a brand new job that was created in the Cabinet Offices - approximately one year ago, perhaps longer. It was a brand new job that had been created and it was filled by an individual who left the position. I asked the Minister who had filled the position and on what basis. He came back and said it was a contract. Now he is saying that it is a term position. I do not want to discuss the individual or any particular personal things about the individual. I am asking strictly about the position.

The reason I am asking is because when the Minister originally gave us the job description for that position, it was a very brief, fluffy sort of job description. It was not even a full page, eight by 11, of duties and responsibilities. He gave us the category of the job, which is an MG5, which is a considerable salary level. I think it is in the neighbourhood of the high $50,000 range to $70,000. In view of that, I think I have every right to ask questions about this particular position. I do not want to ask any personal questions about the individual who holds the position. I would like to know why this position has been changed to a term position when it was originally created as a full-time position.

Hon. Mr. Ostashek: We have the option to either fill these positions for a defined term or to fill them on a permanent basis or, I believe, the option exists to fill them on a contract basis. In this instance, with this particular person, it is a defined term until the end of March 1995.

Mrs. Firth: Is the position going to continue after March?

Hon. Mr. Ostashek: Yes, it will.

Mrs. Firth: What will the position be after March? Will it be a full-time, a term, or a contract position? What are the government's plans for this position?

Hon. Mr. Ostashek: We have budgeted for the full year. Whether it will be filled by a term position or by a full-time position, I cannot say at this time.

Mrs. Firth: I guess it is safe to say that the government does not intend to discontinue this particular position. It is ongoing forever now - for the term of this government, anyway.

Hon. Mr. Ostashek: It is ongoing for this next fiscal year, at least. I just want to draw to the Member's attention that there are 16.5 positions in this branch compared to, I believe, 19.5 under the last administration.

Mrs. Firth: That is all fine. This was a new position that was created, and that was why I asked questions about it. I think that is fair.

On Ministers

Ministers in the amount of $120,000 agreed to

On OIC Personnel

OIC Personnel in the amount of $1,097,000 agreed to

Cabinet Offices on the amount of $1,217,000 agreed to

On

Public Inquiries and Plebiscites

Hon. Mr. Ostashek: We have kept this line item in the budget with a $1.00 vote.

Mrs. Firth: I have suggested to the government that they look at some kind of survey or referendum with respect to the gambling issue. Is this the particular line and program activity from which that kind of activity would be paid?

Hon. Mr. Ostashek: If it was conducted as a plebiscite or referendum, it would be done under this line item. If it is done as a survey, it would be done under stats.

Mrs. Firth: Has the government made a decision yet about how it is going to pursue the question of enhanced gambling in the territory?

Hon. Mr. Ostashek: No. We are going to be meeting with different groups, and we will be deciding what method of further consultation with the public we will be using, whether it will be a survey or other format. I just want to draw the Member's attention to the Member's statement the other day in debate, where she said she did not think it would cost very much. The understanding that we have so far is that a full-blown referendum could be in the neighbourhood of $200,000.

Mrs. Firth: I appreciate that. I did some research about what a referendum could cost. The decision the government has to make is whether it feels that that is a useful expenditure of public funds, and whether the public wishes to be consulted to that extent. I think the Minister will find that there may be some people who would be prepared to accept that. I know the general cost of an election, and I know we would not have to do an entire renumeration. There are some ways in which we could save some money with respect to holding a referendum. We would have to further examine whether we could do it for under $200,000. I think there may be a possibility that we could, but it will be up to the Government Leader to crunch the numbers.

The Government Leader has indicated he is going to be meeting with some groups prior to making the decision with respect to whether or not there will be a referendum or a survey. Could he tell us with which groups he is meeting?

Hon. Mr. Ostashek: We will be meeting with some First Nations groups, as well as with the City of Whitehorse.

Mrs. Firth: All the government is meeting with is First Nations and the city?

Hon. Mr. Ostashek: Those are the ones we are talking about right now. Depending upon what comes from those talks, we may expand it further. During the debate the other day, there was a suggestion that the KVA be consulted, and they may be. We are just finalizing all these issues now and hope to have them within the next few weeks.

Mrs. Firth: Can the Minister tell us what kind of meetings they are? Are there certain representatives? Are they the Minister's meetings? How are they taking place?

Hon. Mr. Ostashek: As I said, we are in the process of setting that up. I like to keep as many meetings as possible at the officials' level.

Mrs. Firth: So, officials from which department will be meeting with First Nations and the city? With whom will they be meeting from First Nations and the city?

Hon. Mr. Ostashek: I do not know with whom they will be meeting yet. As I said, we are just setting this up. I am just telling the Member what we have planned and I have told her which groups we talked about consulting.

This is being headed by the Executive Council Office.

Mrs. Firth: Obviously the Minister has delegated this responsibility to someone in the Executive Council Office. Who has that responsibility, and who will be laying out the plan, initiating the meetings and representing the government at these meetings?

Hon. Mr. Ostashek: Ultimately it is the deputy minister who is responsible for the department. Everyone answers to him.

Mrs. Firth: Has the Minister given any direction to the deputy minister regarding the time line for this process? When are these meetings supposed to take place, and when is this decision to be made?

Hon. Mr. Ostashek: As I said earlier, we expect to make a decision by spring.

Ms. Commodore: The Government Leader has put a high priority on the gambling casino and I would like to know why. What is the rationale for that high priority? There are Yukoners out there who believe that there are many more important things with which this government should be dealing. He says he has not heard from a soul. There were a number of people sitting in the Gallery the other day who were opposing it, and I am puzzled why the government has this very high on its priority list. It does not make a whole lot of sense to me.

Hon. Mr. Ostashek: With all due respect, I believe we are discussing the plebiscite line, and this is not the appropriate time to be getting into that debate. We have already gone through that debate in the Legislature.

Ms. Commodore: I disagree with the Member. He may not want to answer these questions, but there just was a line of questioning in regard to this very same thing. Is he trying to say that he will answer questions from one MLA on this side of the House and not another? That does not make a lot of sense.

Hon. Mr. Ostashek: The debate with the previous MLA was on the process, not the principle.

Ms. Commodore: So, he does not want to answer these questions because he does not know the answers, and that is fine.

I would like to ask him, with regard to the plebiscite, how he intends to do it and how many people he has working on this issue. He has a sub-Cabinet committee, he has people in different departments who are doing all sorts of research and analysis and anything else that is required. If we are talking about a plebiscite, it certainly is a high priority of government.

Could he tell us how much money this is already costing? If he has people in the different departments doing research and analyses of studies, who will be coming back to him and letting him know whether or not there is going to be a plebiscite, how much is his high-priority vision or dream costing us already?

Hon. Mr. Ostashek: It has not cost a lot of money so far. I think one of the biggest complaints by the Members opposite was that the Council on the Economy and the Environment did not spend enough money on consulting. We have made a commitment to consult further with people. We have not made a decision to go with a plebiscite. It was a suggestion by the Member for Riverdale South and we said we would consider it.

Ms. Commodore: I am going to ask him again. How many people does he have working on this vision of his? He talked about the great amount of research and work that was being put into it and he talked about the different departments that were looking at it. That requires a lot of time and one must pay those people a salary to do that. How many people does he have working on this dream of his?

Hon. Mr. Ostashek: I do not know how many people are involved right now but I do know that most of the information has been gathered over a period of a couple of years and it has all been made available.

Chair: Is there further debate?

On Public Inquiries

Public Inquiries in the amount of $1.00 agreed to

On Plebiscites

Plebiscites in the amount of $1.00 agreed to

Public Inquiries and Plebiscites in the amount of $1.00 agreed to

Chair: The Bureau of Management and Improvements is stood aside. Therefore, the total is stood aside as well. Shall we move to capital expenditures then?

Hon. Mr. Ostashek: The department has my budget book here and they have two more tabs in it; one called recoveries and the other is transfer payments. I just do not know if we debate them or whether they are just put there for my information.

Shall we move over to the capital then?

Mrs. Firth: I know we are standing this aside. I just want to refresh the Minister's memory about commitments he made to me about information that he is going to bring back to me. So far, I have not received any of it yet. First was the cost of the boards and committees. Second,

was the transfer of the $60,000 from the Yukon Development Corporation to general revenue for the Boylan contract. He said it was a Cabinet decision and he refused to give us the reason. He said he was going to bring the reason back to us. Third was on the OICs by the Yukon Development Corporation. I had asked him how many, and he promised to bring that back to me as well.

Hon. Mr. Ostashek: It just happens that I have that information at my fingertips. I am glad the Member for Riverdale South reminded me.

There have only been five orders-in-council. Clause 1 was directing Yukon Energy Corporation to undertake energy-related activities exclusively. The next one was regulations and general discussions about bylaws for boards and so on. The next one - clause 3 - was rate relief. Clause 4 was the $60,000 transfer, and clause 5 was rate relief.

On the Boylan contract, the Executive Council Office administered the contract, on behalf of Cabinet, for Mr. Boylan to enter into negotiations with the federal government and Yukon First Nations on behalf of Yukon Energy Corporation.

Part of the Yukon Energy Corporation mandate is to provide administrative support to Cabinet. The contractor receives his instructions from the ECO, based on directions from Cabinet. The contractor's advice regarding restructuring was provided to Cabinet. ECO is the lead department for intergovernmental relations and First Nations relations. It was, therefore, appropriate for ECO to administer the contract on behalf of Cabinet.

Mr. Boylan's contract was to explore the possible restructuring of the Yukon Energy Corporation. When we are restructuring the Yukon Energy Corporation, it would not be appropriate for him to be taking directions from it. Had he been successful in renegotiating the loans from the federal government, there would have been a cost saving for the ratepayers. There would have been lower interest costs, which would have been important. However, at the same time, he was also negotiating to divest some shares to the corporation.

It was agreed that the contract costs would be the responsibility of Yukon Development Corporation. For that reason, the transfer of funds was made. The order-in-council, pursuant to section 15, provides the legal ability.

I forget what the Member asked as the third question.

The Executive Council Office has three boards and committees: the Council on the Economy and the Environment, Health and Social Services and the French Language Advisory Board. The total cost of these boards was $70,000 for the 1994-95 fiscal year.

Mrs. Firth: I will start with the last item to which Minister made reference - the boards and committees. I want the overall cost of boards and committees, not just the ones for this department. The figure we were discussing was the total cost of all government boards and committees. I know that work has been done on this.

The Government Leader is shaking his head, saying no. When the government was first in office, they made the commitment that they were going to reduce the overall cost of boards and committees. They said it was in excess of $1 million a year, by the time they paid all the honoraria, the travel expenses and so on. At some time, someone must have done some analysis with respect to the total overall cost of boards and committees. That was a debate we had in the House and the figure that was discussed.

I asked the Minister for the overall figure, so I could make a comparison of whether the actual cost of these boards and committees is going up or down. That is the information I would like to have.

With respect to the Boylan contract, I listened to the Minister's explanation and I will review it, most likely to come back with questions on it. When this contract was originally awarded, there was no discussion about the Yukon Development Corporation paying for it until after the final contract had been awarded. The contracts were given in February, March and June, and the order-in-council with respect to the Yukon Development Corporation covering those costs was in the latter part of July. I may have some follow-up questions after I have read the Minister's explanation.

Hon. Mr. Ostashek: With respect to the boards and committees, it would be an onerous task to get all the information. They are scattered through every department in government, and it would take a lot of computing to get the information. If the Member really needs it, I will go back to the departments to see what we can do, but it is an onerous task.

With respect to the Boylan contract, the Member is wrong. The decision was made right at the start. The order-in-council may not have taken place until July, but until then, his funding could have been covered under the ECO budget. There was an agreement right from the start that the contract would be paid for by the Yukon Development Corporation.

Mrs. Firth: Is that in the form of a Management Board minute the Minister could provide for this House?

Hon. Mr. Ostashek: It was a Cabinet decision. I will see if there is a Cabinet minute on that.

Mrs. Firth: If it exists, I would appreciate receiving a copy.

With respect to the costs of boards and committees, if the Minister's department has been able to come up with the $70,000 figure for this particular department, I think the other departments could do it. The information is not just for me. I think it is valuable public information. I think that the people who are on the boards and committees would be interested in knowing the overall government spending on boards and committees. I think it is a significant figure in the context of the budget.

I can only see the figure getting larger, with the creation of more and more boards and committees. I think that it would be a worthwhile exercise for us to do now, so that we have a yearly comparative number to analyze. So, I would appreciate having that figure brought to the Legislature for the benefit of the Yukon public.

Hon. Mr. Ostashek: I will review the issue and see what we can do, but it will take some time.

Mrs. Firth: I waited two years for the boards and committees handbook, and then got a different version; the government wanted to try a new format. Can I, at least, get a commitment from the Government Leader that I will not have to wait for two years for this information? Could we get it before the session is over? It looks like we will be here for another couple of months.

Hon. Mr. Ostashek: If the Member will let me consult with the departments, I will give her a telephone call and tell her when she can expect it, if they can do it. I may come back to her to see if she really needs it. I will see what the departments say because, as I understand it, this is going to be fairly extensive research.

The Member opposite says that ECO did it, but we are not talking about just three boards. We are talking about school councils across the Yukon, and all kinds of different boards in every department. It will take a considerable amount of research to get all those figures together. Some of them are honorariums, and some of them are unpaid. It is not an easy task to tabulate, and it is not information that is kept in any one place; it is retained in the department that is responsible for it.

Mrs. Firth: I want to emphasize that it really is a worthwhile exercise. We should get it and keep it somewhere in government for the purpose of comparisons in future years.

Chair: I want to say one more time that the total for the O&M mains is stood over on the Executive Council Office and we are ready to move on to capital estimates.

Operation and Maintenance stood over

On Capital

Hon. Mr. Ostashek: I have just a couple of highlights. There is a $48,000 increase in capital; recoverable funds account for $61,000, or 38 percent. As we have already said in our opening remarks, there is increased capital spending proposed for the Cabinet management support branch, policy communications branch and aboriginal languages. Decreased capital spending is proposed in French languages. An initial vote authority of $1.00 is provided in Land Claims Secretariat for capital purchase related to the implementation of land claims agreements. The Cabinet support branch has the largest capital of $93,000, and that is mainly for office equipment purchases. Recoverable funds account for capital spending in most branches - land claims, aboriginal languages, French languages and Bureau of Statistics. Capital recoveries have decreased $37,000 from the previous year, primarily in the French language services branch, which installed an up-to-date computer network in the 1994-95 year.

On Cabinet and Management Support

Hon. Mr. Ostashek: Office equipment for $93,000: $48,000 is to replace a number of obsolete and irreparable computers, and $45,000 is to replace two copiers.

Mr. McDonald: The Minister indicated that there was approximately $45,000 for the replacement of obsolete computers. Can he explain that a little bit more for us? What makes these computers obsolete?

Hon. Mr. Ostashek: What makes these computers obsolete? They keep inventing new software that these computers cannot run.

My understanding is that many of the workstations throughout government are getting to be eight to 10 years of age and they are obsolete. I have been thoroughly convinced of that. There is $48,000 to replace the obsolete and irrepairable computers, and it is my understanding that we can no longer get parts for some of them.

Chair: Is there further debate?

On Office Equipment

Office Equipment in the amount of $93,000 agreed to

Cabinet and Management Support in the amount of $93,000 agreed to

On Land Claims Secretariat

On Implementation

Mr. Penikett: This is an outstanding question: I asked the Government Leader about the amount of money that would be allotted for implementation. He said earlier that they were expecting to have a supplementary estimate later in the year - is that correct?

Hon. Mr. Ostashek: That is correct. It will depend upon when we get the money, but first we need the bills assented to in Ottawa. The other evening, I did read into the record how much there was in implementation money.

Mr. McDonald: This is probably a technical question but the Land Claims Secretariat just shows $1.00. The presumption is that without this so-called vote authority, the government would not be able to purchase computers for land claims. I am puzzled by this question. Perhaps I will ask the question as a general budgeting policy question in Finance. I was under the impression that this government does not require a technical vote authority in this particular area - this does not necessarily constitute vote authority. They already have vote authority due to the fact that they have some capital money proposed some place in the branch. Maybe I will ask the question when the Deputy Minister of Finance is with the Minister because I think that would be more appropriate.

Hon. Mr. Ostashek: I would appreciate it if the Member would wait until we get into Finance, and then maybe we can answer that for him.

Implementation in the amount of $1.00 agreed to

Land Claims Secretariat in the amount of $1.00 agreed to

On Policy and Communications

Hon. Mr. Ostashek: There is $11,000 allocated for photography equipment for two specific purchases that are necessary to support the photography unit: a black-and-white paper processor and a silver-recovery unit.

On Photography Equipment

Photography Equipment in the amount of $11,000 agreed to

Policy and Communications in the amount of $11,000 agreed to

On Aboriginal Language Services

Hon. Mr. Ostashek: The sum of $18,000 has been allocated to upgrade two computer units and a printer, and to replace a photocopier.

Mr. Joe: I would like to ask questions on aboriginal language services. How are the programs distributed to the communities, and which community receives the most funding?

Hon. Mr. Ostashek: This is only one part of aboriginal language services done through this department. Interpreters are funded from this department, as well as the translation of written text. This department also pays for community initiative programs, broken down between Southern Tutchone, Kaska, Northern Tutchone, the Haan, Gwitchin, Tlingit, Tagish, and another one called "all languages". It is distributed to those different language groups. I do not know if that helps the Member, but perhaps he has another question he would like to ask.

Mr. Joe: My question is this: which language receives the most funding?

Hon. Mr. Ostashek: I have a copy of the aboriginal languages community initiatives program, which is a contribution agreement for 1994-95 by different language groupings, and that is the way it is distributed. If the Member would like, I could table that for his benefit.

Mr. Joe: Will there be rental space in the Carmacks First Nation for aboriginal languages? I sent a letter to the Government Leader on the location of the aboriginal languages office to complain about the location. They want it moved to a new building.

Hon. Mr. Ostashek: I recall the Member's letter, and the department is looking at that right now. I do not have an answer for him today, but it is under discussion in the department.

Chair: Is there any further general debate?

On Office Equipment

Office Equipment in the amount of $18,000 agreed to

Aboriginal Language Services in the amount of $18,000 agreed to

On French Language Services

Chair: Is there any general debate?

Hon. Mr. Ostashek: There is an allocation of $23,000 for two purposes: an upgrade to a major piece of specialized computer equipment and relative software used in translation and to replace two obsolete computers used for French language service delivery in Health and Social Services.

On Office Equipment

Office Equipment in the amount of $23,000 agreed to

French Language Services in the amount of $23,000 agreed to

On Bureau of Statistics

Hon. Mr. Ostashek: There has been $20,000 allocated in recoverable funds for maintenance of the bureau's computer network.

Mr. McDonald: This is a passing comment on all the requests for computing equipment. I am glad to see that this particular department has not characterized any of these, unlike other departments, as a winter employment project.

I thank them for their honesty.

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

Bureau of Statistics in the amount of $20,000 agreed to

Capital in the amount of $165,000 agreed to

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

Motion agreed to

Hon. Mr. Ostashek: Is it the wish of the Chair to take a short break before we start Finance?

Chair: Is it the wish of the Members to take a short break at this time?

Some Hon. Members: Agreed.

Recess

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

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

Department of Finance

Chair: We are discussing Bill No. 3. In the supplementary estimates, we are on Finance. Is there any debate?

Hon. Mr. Ostashek: I have a few opening comments. The Department of Finance has given up $489,000, the vast majority of which is O&M funding in the amount of $478,000, but there is also a small $11,000 reduction in capital. The O&M is due to several factors, the most important being projected savings on our banking contract due to higher interest rates and larger than expected cash balances being on hand. The capital saving is a result of monies not being required for a systems study. I do not know that there is much more to say about this. I will listen to comments from the Members opposite.

Mr. McDonald: I am sure we will get into the banking contract shortly. I am interested in the proportion of money that is being saved because of the banking contract and that which is being saved as a result of the systems study not proceeding. I will ask that question in due course, and the Minister can perhaps answer it in due course.

I would like to begin with a minor technical matter, the same one I raised in the debate of the last department. That is the question of identification of vote authority.

I raise this issue because I think there has been a fair amount of confusion as to what $1.00 in the main estimates book means and what vote authority in the budget bill means. We just had a department that requested a branch within a branch to have $1.00 set aside so that it could have spending authority to buy a computer, or something. I think that adds to the confusion factor. I wonder if the Minister could give us his opinion about what the government could do to clarify the situation for us.

Hon. Mr. Ostashek: For the information of the Members opposite and of the Legislature, it is stated that way because we know we may have to spend some money on an item, although we do not know how much. If we did not put it in the budget, even though we probably do have the authority under the capital vote in that part of the department, we have not clearly laid out to the Members opposite some other capital expenditures we could not calculate that may be required at the time the budget is published.

Mr. McDonald: Is that position consistently adopted throughout government departments? If it is known that there is an anticipated expenditure in a particular area, will it be listed as a $1.00 item?

Hon. Mr. Ostashek: The departments try to be consistent. I would not want to stand here and say that they are all the time, but efforts are made to try to be consistent with the votes.

Mr. McDonald: I will keep an eye open for any inconsistencies I can identify and will point them out to the relevant Ministers so that we can get some sense of order here. I am always bemused by assumptions that longstanding Members of the Legislature will make about what a $1.00 amount might mean; that is, whether or not it is their interpretation that they are giving somebody vote authority to do something. Where the distinction lies between the requirement for real vote authority to do something and simply identifying a need that may come up is not made clear in the budget book. I already know that some needs have been identified as eligible for expenditures using the government's contingency fund, for which I cannot find a $1.00 vote, but perhaps I will point that out later when we get to those items in the budget itself.

First of all, the Minister was going to provide some information on the banking contract, including the tender call and the contract itself. Can the Minister also tell us what amount of money being returned in supplementary was dedicated to banking costs?

Hon. Mr. Ostashek: We will try to deal with them, one at a time.

On the tabling of the banking contract, we are talking to the Toronto Dominion Bank. They do have some concerns about it, and we are trying to get them sorted out. We hope to be able to table the contract, but the issue is not resolved yet.

Can the Member refresh my memory on the second issue he was addressing?

Mr. McDonald: I believe that the tender call and addendum to the tender call was also requested.

I am also interested in learning about the amounts being turned back. What were the savings as a result of the higher than expected compensating balance?

Hon. Mr. Ostashek: That figure was $390,000.

Mr. McDonald: With regard to the request for the other information, surely the bank would not have any concern about our seeing the tender call and the supplementary request.

Hon. Mr. Ostashek: The Member is quite correct, it does not have a concern about that. My officials were going to try to prepare it in the form of a package for the Member.

Mr. McDonald: I have a few general questions.

First of all, we have discussed before the size of the land inventory in the government and its ultimate effect on the costs of banking. Can the Minister tell us approximately what the size of the land inventory is at present?

Hon. Mr. Ostashek: The Member can find it on page 17 of the public accounts. It is just under $20,000 - I am sorry, I mean $20 million.

Mr. McDonald: Believe me, the Minister did not have to correct himself. I think we understood that to be a mistake. The $20 million is what was expected at the end of the last fiscal year - is that correct? There has been a fair amount of land development underway this year, and obviously there is another $8 million or $9 million slated for this coming fiscal year. What is the projected land inventory expected to be at the end of this calendar year and the end of the next fiscal year?

Hon. Mr. Ostashek: The Member may wish to address that question to the Minister of Community and Transportation Services. According to our calculations, we expect that it may increase by $1 million to $2 million.

Mr. McDonald: What the Minister is saying is that after the end of last fiscal year, we will be spending approximately $20 million in land development, and that there will be approximately $18 million worth of land sales in the Yukon - is that correct?

Hon. Mr. Ostashek: I think what we are saying in the budget is that, while the figure is there, as the Member opposite knows, we probably will not spend it all. This still does not have any effect on our surplus or deficit position.

Mr. McDonald: I know that, and I thank the Minister for reminding people who do not. I am more interested in what cash is tied up in land development, what is not available for interest income and its ultimate impact on the cost of banking services. Can the Minister arrange to have the Minister of Community and Transportation Services, who we will be coming to in the next department, come back with a list of all lands developed in the last year, lands that are projected to be developed in the coming year, and the total amount of inventory that we can expect, given the fairly aggressive expenditures in this area?

Hon. Mr. Ostashek: Yes, I will ask the Minister to do that.

Mr. McDonald: Banking services is something that I will get to in the main estimates vote, because that is where a request for $150,000 has been made. I would like to pursue that more thoroughly then.

Can the Minister tell us whether or not there have been any organizational changes in the past year in the Department of Finance or whether they expect any in the coming year?

Hon. Mr. Ostashek: There has been no organizational change in the past year, nor are we expecting any.

Mr. McDonald: What a predictable department. I think that the same words have probably been stated every year, probably for the last 100 years. Nevertheless, it does make it predictable. I am certain that if anyone asks me what the Department of Finance is all about, I can, from memory, tell them 25 years from now what it is doing.

Can the Minister refresh our memories about what the impact was for each of the changes in income tax rates that were passed by the Legislature a year and one-half ago?

Hon. Mr. Ostashek: I believe we have it here somewhere. If the Member would just like to continue, my assistant will search through his files and see if we find it. I recall having it here when we were in general debate on the budget.

Mr. McDonald: While we are finding that information, I would like to recap briefly the discussion we had yesterday about land claims funding, because I am very nervous about governments initiating pilot projects to promote self-government - a good cause - for which there is no agreement by the federal government to assume financial responsibility for them when the self-government agreements are signed.

The Minister responsible for Health and Social Services has indicated that there was a very clear understanding, as far as the Yukon government and the individual First Nations were concerned, that the funding would be finite - it would be a pilot project and it would ultimately be a federal responsibility.

Unfortunately, neither of those two parties is the federal government. It is the federal government's opinion that ultimately counts when it comes to deciding whether or not the Yukon government has, historically, financially occupied a field.

What is the government prepared to do to ensure that there is a federal financial commitment to support these pilot projects in the long term, once self-government agreements have been signed?

Hon. Mr. Ostashek: The Member raises a concern we grapple with every time we deal with one of the agreements. There is no assurance that the funding will be picked up by the federal government, and that is why we try to make it clear to the First Nations that this is strictly a pilot project with no ongoing funding committed to it past the finalization date of the project, which may be one to three years.

I do not know what alternatives are open to us, other than to tell the First Nations that we are not prepared to enter into a pilot project because we may be stuck with it in the end. We have been trying to make it very clear to the First Nations that this is an interim arrangement and not a commitment we feel we are making on an ongoing basis. That is why the project is clearly titled "pilot project".

I do not know what the answer is. The Member opposite held this portfolio, and he knows one can put all kinds of words in an agreement and receive words of assurance from the federal government, but when the crunch comes, those words do not really mean much.

Mr. McDonald: There is a difference among words of assurance. Something in writing on a project-by-project basis - a letter from someone who stands for something in the federal government - would help assure us that what is called a pilot project is going to be funded over the long term.

In the case of some of the projects supported by the Minister of Health and Social Services, there have been some unkind suggestions that perhaps the Minister is seeking to provide support only for those initiatives in his own riding. This raises the concern that, if the Minister is responding to legitimate needs within his own riding, what is the impact across the territory?

He may be doing something that is, on the face of it, valuable, but ultimately he is creating an expectation that it should happen elsewhere. The First Nations who are in similar circumstances feel, quite rightly, that they should be given the same fair treatment.

The other side effect of this is, of course, that the federal government is watching us very closely to determine who occupies a field. I realize that it is not a precise science to determine where we assume historical responsibility and where the two governments saw off their respective responsibilities. I would argue, however, that it is only made more difficult by transitional arrangements that seem to crop up now and again in the name of some pilot project.

I am obviously concerned.

In terms of future pilot projects, would it be fair to suggest that, in the signing the pilot projects, there would be some energy put into getting the federal government, on a project-by-project basis, not to commit to the level of funding, but just to the fact that this is an area that is not traditionally the Yukon government's sphere of responsibility, and that, ultimately, program funding would therefore have to be determined at a future date if the federal government were to continue funding First Nation services in those communities?

Hon. Mr. Ostashek: That is a fair comment. I will take notice of it and discuss it with the appropriate Ministers if we get into this discussion about pilot projects again.

The Member says that while we are carrying out a pilot project in one area, there may be legitimate requests in other areas of the Yukon. That is true, but the reason we call it a "pilot project" is because we cannot enter into funding agreements for other areas until this pilot has been completed and analyzed to see if it is an effective way to spend money.

In terms of the concern about a pilot project being transferred to other communities prior to the completion of the first one, I do not think that that is the rationale under which we have been operating in putting the pilot projects together. They are entitled "pilot projects" in order to make certain that government has an escape clause. We will want to analyze the project after its completion in order to ensure that it has fulfilled its intended purpose.

The Member makes a very valid comment. I will take that representation and see if there is some way that we can tie the federal government to a letter or a statement indicating that they understand that it is a pilot project, and not a field we should be occupying.

I have now pulled together the impact on revenues of the rate increases implemented by the government. I will deal with them in the supplementaries first and then in the main estimates.

On personal income tax, there has been an increase of $3.3 million, $2,931,000 for corporate tax, $643,000 for diesel fuel, $1,252,000 for gasoline tax and $3,354,000 for tobacco tax, for a total impact on the 1994-95 year of $11,480,000. For the projected 1995-96 main estimates, there is $3,317,000 for personal income tax, $3,019,000 for corporate tax, $778,000 for diesel fuel, $1,387,000 for gasoline tax and $3,537,000 for tobacco tax, for a total of $12,438,000.

Mr. McDonald: Is that listing of taxes a result of tax rate changes? What is the effect of the tax rate changes themselves?

Hon. Mr. Ostashek: That is right. It is the effect of the tax rate changes.

Mr. McDonald: Is the $3.3 million in personal income tax from this current year and the $3.7 million for next year a result of projected volume increases? Are there any rate changes in this year or in the transition period?

Hon. Mr. Ostashek: The Member is correct. The 1995-96 year will be projected volume increases.

Mr. McDonald: I would like to point out one last thing in terms of the subject of pilot projects. The Minister is quite correct that one reason for calling something a "pilot project" is to ensure that the effectiveness and efficiency of a particular service is determined prior to applying that service territory-wide, in all like situations. It is also commonly used when someone simply does not want to provide the service anywhere else, or does not have the money to provide it anywhere else, and wants to provide it in only one community. One obviously has to guard against - or prepare for - any criticisms that may arise from that direction.

I have a number of questions for the Minister. I realize we are bouncing around here a little bit, but we have already covered a lot of this ground. I just have some supplementary questions to clear up the details.

The Minister is going to be going to a federal Finance Ministers conference shortly, and I am sure he is going to get an ear-full from the federal and other Ministers about what they think is going to happen in the federal budget and what they think should happen. Presumably the Minister will pass judgment on some proposals that may affect the Yukon in ways that create an imbalance of an expenditure cut in the territory as compared to an expenditure cut in one of the provinces.

One of the arguments that government leaders in the past have used with federal officials in justifying our transfer payment is that the territory has taken the view that we deserve the same level of services provided by government as other provincial jurisdictions provide to their citizens. First of all, is that an argument in which the Minister believes? Also, is it one that he has communicated - or is prepared to communicate - to the federal government?

Hon. Mr. Ostashek: Yes to both questions. If they want us to operate here as a distinct territory, which seems to have been the desire of past governments, then I believe that our citizens are entitled to the same level of services as other Canadians. We have quite clearly stated that in all of our negotiations with the federal government.

Mr. McDonald: Another argument that the Government Leader has identified that is worthy to present to the federal government is that we require funds to build infrastructure in the territory, in order for us to become more economically self-sufficient, to use the Government Leader's term. How does that translate into the Minister's position in the face of the federal Finance Minister's concerns about the federal budget? What is the Government Leader going to say? Is he going to say that, despite those concerns, there should be money invested in infrastructure in the Yukon? Or is the government going to say, "We have had enough now. Thanks very much. We are prepared to see a fairly substantial cut." I need to get a sense of how aggressive the government is going to be in pursuing the Yukon as a priority, when it comes to facing federal cutbacks.

Hon. Mr. Ostashek: I think that I have stated time and time again in this Legislature, and I did so in general debate on the budget, that our position is that we must be treated equally with all other Canadians. We have said that the way the per capita programs are delivered is on a per capita basis. If they are going to cut them on a per capita basis to the provinces, then we will have to accept a per capita cut as well. I also said that that is one of the things that does not sit very well with the federal government, and that is because of our small numbers. When they look at the size of our budgets, they always keep pointing out the amount of money that they are pouring into the Yukon. They sometimes try to deal with us in a harsher manner than they deal with the provinces.

As I told the Member in general debate, one of the reasons that we were not successful in negotiating a formula financing agreement this time was that the federal government was still treating us, for budgetary purposes, as a part of the Department of Indian Affairs and Northern Development. They said that DIAND is going to take its lumps in this budget, and therefore the territories should take their lumps as well. We argued successfully that we should not take them at the same time as DIAND, but at the same time that the provinces do, if in fact they were going to treat us like a province.

We have only been able to delay the cuts that are coming down, but we are going to be adamant that we not be penalized by the cuts any more than other Canadians are. We are going to make a very strong case for that.

Regarding the issue of infrastructure, the argument that I have been making to the federal government is that, if it ever wants us to have the capability to be more self-sufficient and work toward that goal, it is not going to be possible to do that unless there is a substantial investment in infrastructure in the Yukon.

That can be accomplished in several ways. The federal government can either fund it directly, or - and this is my argument - it should not penalize the territories for volume increases in taxes. That will give us more revenue to distribute in a manner that we see fit, or into projects that we believe would be the most beneficial to the territory.

Mr. McDonald: To recap, if there is a spending cut, the Minister is saying that direct transfers to the territory on a per capita basis should be cut the same for the Yukon as for the provinces. Is that a fair assessment?

Hon. Mr. Ostashek: If we are going to be treated in an equitable manner, that is how it would have to be done. I do not see any other way that it could be handled. Our first priority is a position that has been put forward by our neighbours, and that is that if the federal Minister has a ballpark figure he wants to cut from our transfer that we have some input into directing where those cuts would be, rather than his telling us where they are going to be.

Mr. McDonald: The picture is becoming a little clearer. I am a little pressed to precisely understand how the government is going to make the argument of a per capita spending cut being fair, which I do not disagree with, while at the same time making the case that spending should not be cut at all but increased, because our level of infrastructure is severely behind those of other jurisdictions. We are playing catch up. I would appreciate hearing anything the Minister may have to say on that.

I have taken the trouble of going back to other pre-budget assessments done by the Yukon government. The strategic analysis of economic impact associated with the renegotiation of the formula finance agreement document was done in 1989. It contains some interesting information about what one should consider important when negotiating for funds from the federal government. One of the interesting facts raised is that direct and indirect federal spending in the Yukon has declined. Ever since some highs in 1984, it has actually been going down quite substantially. For example, from 1984 to 1988, direct federal government expenditures in the Yukon dropped from a per capita nominal rate of $7,716 to $5,892.

During the same period, the per capita real rate for indirect federal government expenditures in the Yukon dropped from $1,458 to $1,254. This says that even during the period when we were supposed to be rolling in the old buckeronis, per capita spending in the Yukon by the federal government was declining. Presumably, that has not become a lot better, but I would be interested in knowing what the trend line for the last couple of years is.

Does the Minister know what it is for direct and indirect federal spending?

Hon. Mr. Ostashek: We do not have that right now, but we will try to get it for the Member before we have finished the budget debate.

I just received a note on the value of land inventory. As of March 31, 1995, work in progress is projected to be $6.4 million, finished land, $9.1 million, for a total of $15.5 million. This was as of the period 8 variance, and we do not expect any change between now and the year-end.

Mr. McDonald: I will test that with the Minister. I think it is more appropriate to make some sense of the figures in Community and Transportation Services.

The Minister will try to get us information on the trends of federal spending, he said. I think that is an important figure to identify before the cuts come along.

Could the Minister also identify what the direct and indirect federal spending will result in and commit to provide that after the federal budget this spring? I would appreciate receiving it.

Hon. Mr. Ostashek: I do not want to make a commitment to the Member, but I will try. We will see what the budget contains when it comes down. I would not be that optimistic that we are going to have a budget on March 1. I would not be at all surprised to see the budget delayed.

Mr. McDonald: I do not doubt that. I think that that may well be the case.

I am going to try to get some detailed sense of what the impact of the federal budget cuts are on the Yukon, and how they compare to other jurisdictions. One of the things that we have to take into account, of course, is that the federal public service, as a percentage of our population, is higher here than it is elsewhere. Ultimately, any cuts that they seek in the federal public service will obviously disproportionately affect the Yukon's economy, moreso than it would in other jurisdictions. I will be asking, at some point, how that has been taken into account after the federal budget.

What is the Minister's position on the northern tax deduction? It has been the subject of a lot of debate in the House. Clearly the Minister is going to have some opportunity to provide some input to the federal Minister, prior to the federal budget. Has he insisted that this tax deduction be maintained in its present form and at its present level?

Hon. Mr. Ostashek: I do not think we are going to have any further opportunity to have any effect on the federal budget. I think we had that opportunity in our September meeting in Toronto, when the Minister laid out for us the areas he was exploring. At that point, the northern benefits was one of the issues that was raised, and I certainly quite clearly stated that I felt it should be maintained.

Mr. McDonald: The point has been made that when the federal government changes the unemployment insurance system, not only does it have an impact of often transferring income support payments to the social assistance roles, but when the premiums are increased because the incomes in the Yukon are higher than they are elsewhere, it hits the Yukon more than it does other jurisdictions. Has the Yukon government ever made that concern known to the federal authorities?

Hon. Mr. Ostashek: That is a tax-burden question and it is one on which we have made our position known during the formula financing negotiations.

Mr. McDonald: The impact of the GST on the Yukon is greater than it is elsewhere. Clearly, when one has to pay GST on some goods that have been transported to the Yukon, and consequently cost more, the cost to Yukoners is higher. Even when one considers the offset provided for low-income people, because we have higher incomes, the offset has less impact on the Yukon than it has elsewhere.

Have these concerns been raised with the federal government?

Hon. Mr. Ostashek: Yes, those were raised on the same day the UIC premiums and tax burden to Yukoners were raised.

Mr. McDonald: So, we know then that the federal Liberal government is aware of the impact of making changes in this area and consequently, if they do not account for northern conditions, we will know that they have ignored a position stated by the government - presumably a position stated by the Yukon government.

When it comes to the economic development agreement, what has the government's position been in terms of funding for business through the agreement? What has the government's position been in terms of seeking renewals?

Hon. Mr. Ostashek: Before I get to that, I want to add to the GST burden issue - that was another issue I raised personally, not only through officials. I raised it personally with Mr. Martin in Vancouver last July, when they were talking about the amalgamation of the sales tax with the GST. It was raised as a concern with him at that time.

I believe the Member is aware that the EDA program expires as of March 31, 1996. We have just received a letter - I believe the Minister of Economic Development received it and I received a copy of it - in which, if one reads between the lines, they are not overly enthusiastic about maintaining the economic development agreements. I will be raising this with Mr. Martin in Ottawa, if I get the opportunity when I get to the Finance Ministers meeting. If I cannot raise the issue, I will be raising it with the Minister of DIAND if I can get a meeting with him while I am down there on the same trip.

There are going to be cuts somewhere; there is no doubt about that. What I am saying is that we have to look at the overall package of cuts and be certain that we as Yukoners, or we as northerners, are not being asked to share a larger burden than other Canadians are, and that is going to have to involve all the different programs that are out there.

At this point, I can only say that we are concerned about the economic development agreement programs. We have been trying to get a commitment from the federal government, but the letter we received the other day, while it did not say there would be no more programs, was not overly optimistic.

Mr. McDonald: The point of my questioning is that if we are unduly hurt by the Liberal budget, it will not be because the Liberal government is hurting us unduly out of ignorance. All these issues have been raised with federal ministers and officials. If they undertake some measure that affects Yukoners more than what is considered fair, then they are doing it knowingly and obviously do not care.

I want to make that clear, because it may ultimately be a fairly significant issue. I want to get the base-line information down so there are no mistakes.

The Minister appeared hesitant to take a position on any anticipated training program funding cuts to the Yukon. This should not be a hard issue to address. Is it the government's position that any cuts in this area should be applied equally across the country and, as a priority item, where on the list of funding cuts does the Minister believe this should be - high or low?

Hon. Mr. Ostashek: The reason I am reluctant to take a position on it is because of what I said during Question Period to the Member for Mount Lorne: in my opinion, the federal government is floating a lot of trial balloons. It is looking at public reaction; it is reviewing its consultative meetings across the country. There is no doubt there have been a lot of bad noises from Ottawa involving the level of the cuts the Finance Minister is facing in this budget. I do not believe that the targets set by the Liberal government are any longer valid. I believe they are no longer acceptable to bondholders.

They are looking for something far more dramatic than a three percent of the GDP or a $25 billion budget. They just do not find that acceptable any more.

The federal government is also faced with rising interest rates which, again, impact on the magnitude of its cuts. That is why I said that I would not be confident that there would be a budget coming down on March 1, as is now projected, because there are so many variances that the federal Minister has to deal with.

In terms of the priorities of cuts, I believe that we have to have training programs. If the federal government is going to vacate that area and turn it over to the provinces and territories, that may not be all bad. There may be some benefits to us, if even a reasonable amount of funding came with it.

The same goes for the costs of health and social services. If it is the federal government's desire to vacate those fields completely, which is the rumour coming out of Ottawa since last weekend - as I am sure, the Member has heard, as have I - that may not all be bad. However, I am reluctant to take a position until we have had time to analyze all of that information and know exactly on what we are taking a position.

Mr. McDonald: In general terms, I guess that is probably a fair position to take, as long as there is no implied suggestion that perhaps the government has already taken a position on training cuts, in that perhaps training spending is a worthwhile target and ultimately worth cutting. From the Minister's comments, I am assuming that he has sent no such signals to the federal government. That would be more reactive than proactive. Am I correct in that assumption?

Hon. Mr. Ostashek: One only needs to look at the budget and the initiatives to enhance job training that have been undertaken by this government over the last few months. The Minister of Health and Social Services has been negotiating with Mr. Axworthy's people to enhance training programs for people on social assistance. We place a very high priority on job training so that we can keep Yukoners working. We certainly have been making that known to the federal officials.

Mr. McDonald: Ultimately, this matter will be brought up with the Minister of Education. One concern I have had, and have now, is that when the federal government changes its training funding profile, and particularly directs more training spending directly to the private sector - meaning subsidies to the private sector - the Yukon is not a natural beneficiary of those training funds, because we do not have as sophisticated a private sector that is ready and waiting for the training money as it exists elsewhere. I will raise that with the Minister of Education, or someone else will raise it, I am sure.

I have another question about econometric modeling. I am interested in the impact of the dollars spent in both operations and capital. I know that the modeling does go on. I know that an analysis is done of the relative impact of operations and capital spending, so I would like to ask a couple of questions of the Minister.

He has indicated that it is a budget priority to have money directed toward capital spending, because he says it has a greater impact on the private sector - private sector employers get more government work. Can the Minister tell us - and I am not insisting that he do it now - what the employment impact has been and will be for the public sector payroll cuts? I note from the document that I cited before that they have identified that the employment impact of $1 million spent in construction is approximately 2.75 jobs. I am interested in knowing what the employment impact is of public sector wage rollbacks. If the Minister can give us that information - I know they have it and it is only a matter of when they can get it to us - I would appreciate receiving it.

Hon. Mr. Ostashek: We will have to get the numbers on that. We do not have them here with us today, but we will bring them back for the Member.

Mr. McDonald: That is something I would be interested in, in due course.

I have another general question, and then perhaps I will let others butt in because I have been going on for quite awhile.

Have there been any changes made as to how spending proposals by departments have been tested by the budget bureau and Management Board? Is the system essentially the same as it was two or three years ago?

Hon. Mr. Ostashek: It could be said that the mechanics of the system are basically the same as have been in the past.

Mr. Cable: I would like to follow up on the earlier question from the Member for McIntyre-Takhini. When we get to the mains on Finance, which I assume will be tomorrow sometime, are we going to have the package on the banking contract?

Hon. Mr. Ostashek: I do not know. We are talking to the bank. They are very uncomfortable with us releasing the contract, so we have to do some negotiating with them. I am not certain when that will be ready. The Member for Riverdale South is saying something, but they are the other entity that has signed this contract, and we have to deal with them.

Mr. Cable: The contract was put out to tender, and I assume that all of the major particulars were found in the tender documents. What is the government's position on this? Does the government see any problem with releasing the contract?

Hon. Mr. Ostashek: No, we certainly do not see anything wrong with it, but it is a commercial contract and some rules apply. We must deal with the other half of the contract - the Toronto Dominion people.

Mr. Cable: Generally speaking, I do not think contracts are a secret, at least contracts that are tendered, anyway. Perhaps contracts that are put out for proposal calls, which might have some nifty, competitive advantages in them, might arguably be kept secret. What is it that the Government Leader sees would be a reason for confidentiality?

Hon. Mr. Ostashek: We do not see a reason for confidentiality. It is only proper that we consult with the bank. I do not think that the bank can make a valid argument about why it should not be tabled in the Legislature. It is, after all, a contract with the government, but we have to make sure that we are clear on that, so that we do not end up exposing ourselves to a lawsuit.

Mr. Cable: The signal was given to the Government Leader, what was it, a couple of weeks ago that we wanted this tabled. Why has there not been a resolution of this confidentiality matter?

Hon. Mr. Ostashek: In this case, it is not just a matter of talking to the local manager of the TD bank; we have to work with its regional office in Vancouver.

Mrs. Firth: I am quite concerned about the approach that is being taken. Unless there is some kind of special clause in this contract that indicates that the contract should not be made public or that information within the contract should not be made public, and is something that YTG agreed to when the original contract was awarded, I do not see a reason why the Minister cannot table the contract in the House. I cannot think of any other instances where a contract is publicly tendered and awarded, and then treated as a confidential document when it was an expenditure of taxpayers' money.

Hon. Mr. Ostashek: I just stated quite clearly that we do not think it should either, but it is only appropriate that we discuss it with the bank and see what the concerns are. I do not believe we would sign a contract that had those kinds of confidentiality clauses in it, but it is still appropriate that we consult with the bank and that is what we are doing. As soon as we can expedite it, we will table a contract. I personally have no difficulty with that.

Mrs. Firth: When I asked the Government Leader to table the contract with respect to the Shakwak project, did he consult with the contractor before he tabled that contract in the House?

Hon. Mr. Ostashek: I consulted with the Department of Community and Transportation Services and they had no difficulty with it being done. In this case, I do not know whether the department has consulted with the proponents or not, but in fairness we are going to be on this debate for awhile and we will get the contract, if at all possible, and table it in the House. So, bear with us; we are trying to get it.

Mrs. Firth: I would like to bear with the Minister but I am trying to understand the rationale behind this. If the Minister feels the contract should be tabled, why did he not just table it? Why did he ask the contractor whether or not they had any problem with his tabling it? Obviously every other contract we have asked for in the House - Boylan's contract, the Shakwak - have all been tabled and I do not understand why there is one set of rules for one kind of contract or contractor and another set for someone else.

Hon. Mr. Ostashek: I do not believe there is a separate set of rules. There may be things in the contract - the way the interest rates or service charges have been defined, or something - the bank feels are confidential. I do not know. We do not believe the bank has a valid argument but it is only courtesy to contact the bank and have this cleared. If the bank says no, then we will decide whether or not to table it, depending upon whether the bank has made a valid argument why we should not table it.

I cannot foresee that at this time. It is just common courtesy that we give them the chance to respond.

Mr. Cable: I wrote to the Government Leader some time ago asking about this contract. He wrote back on November 24, 1994, and said, "In the past, when questions about the banking contract are being raised, it has been the policy of the government to speak with the bank about which information may be released. When this contract is signed, we will speak with the Toronto Dominion Bank about what can be made public. To the extent that the contract can be released, a copy will be forwarded to you." That was back in November. I do not want to hound the Government Leader, but why was the issue not taken up earlier so we could expedite the debate?

Hon. Mr. Ostashek: That is a valid question, for which I do not have a valid answer for the Member. I do not know why it was not followed up on at the time, but we are following up on it now. We hope to be able to table the contract.

I believe there was a question somewhere back in the debate. It will probably come up again, so maybe I can cut it off by giving this information to the Member. I believe it was requested by the Member for McIntyre-Takhini. He asked us what costs were involved in changing over the contract, such as printing new cheques, and so on. The total one-time cost to transfer the contract from CIBC to Toronto Dominion was $6,280. It was broken down as follows: the cost of CIBC cheques paid for, but not used, was $3,805. A couple of modems had to be purchased for YTG and Workers' Compensation Board for a cost of $1,350. Computer programming for Yukon Housing Corporation and non-YTG staff cost another $1,125. The total cost was $6,280.

Mr. McDonald: To refresh my memory, the costs associated with using CIBC branches now would be approximately $15,000 - that would have to be per year. Could we recover that expenditure through compensating balance? Obviously we do not have a contractual arrangement. That is going to be a pure, outright expenditure. Is that correct?

Hon. Mr. Ostashek: That is correct. That will be an outright expenditure, but that was calculated into the total cost savings that were included in the other figure, because we receive a higher interest rate on the compensating balance at the Toronto Dominion now. The Member is correct. That payment will be going out directly, and we do not have a compensating balance for that specific payment.

Chair: Is there further general debate?

Mr. Penikett: I do not know whether the Government Leader mentioned this earlier or not, but when can I expect answers to my questions about commodity taxation and insurance?

Hon. Mr. Ostashek: I believe we have that here today.

I have some papers for tabling, but for the Member's information, I would prefer to read this into the record.

The questions were asked in relation to commodity taxes. I will probably not hit on all the questions asked, and the Member may want to follow up on some.

The Member asked if I was certain we were collecting all the commodity taxes due us as a government, and my reply to that was I was not sure. We have no information at this time that would lead us to believe that anyone is avoiding payment of such taxes; however, I do not believe any Minister could stand here and say we are absolutely, 100 percent sure we are collecting every cent. I do not think that is possible.

Absolute and complete compliance may be a theoretic goal of any tax collection agency, but to achieve it would be highly impractical.

The Member also asked if it would not be economical to devote more resources to collection enforcement activities. I think one has to use a commonsense approach to that. One has to consider how much it is going to cost to collect the few dollars one may be losing. If we had any reason at all to feel there were concerns out there, we would be pursuing them. As I said earlier, we simply do not have any information that leads us to believe that is happening.

Having said all of that, it does not mean we should not use our best efforts, which I have already addressed. We do use our best efforts. I believe it is incumbent upon us to maximize compliance, even if the benefits do flow to the federal government. I know that the Members opposite felt the same way when they were in government. Aside from the moral obligation, there is also a practical, self-serving justification for reducing the federal grant, because the lower the grant, the less likely that it will suffer cuts in any federal cutback.

There is one exception to the rule under the perversity factor, and that is on aviation, fuel, and tobacco tax. The rate increases implemented one and one-half years ago were such that, despite perversity, we are actually receiving a net benefit from every dollar of taxes collected, assuming the additional cost of collection activities does not exceed the additional revenues that are gained.

It was also suggested that the federal government may be upset about the level of enforcement, but I do not believe that is a valid concern. First, it was seen that the federal government could only be concerned if we had a decrease in the resources devoted to commodity tax collection subsequent to the introduction of formula financing - hence the perversity factor. However, that has not been the case. We have not cut back because of perversity; we are still expending those dollars on tax collections. I believe that formula financing was introduced in 1985-86. A year or two later the Members opposite, when they were in government, increased the resources devoted to this purpose, despite the fact that none of the revenues gained would flow to the Yukon's benefit.

When the new formula with the perversity factor was introduced in 1990-91, Members opposite did not reduce the resources dedicated to commodity tax collection, even though the Yukon was losing roughly $1.50 for every $1.00 collected. We agree with those decisions and consequently have not altered the commodity tax collection resources from those that existed when the Members opposite were in power. We believe that the issue is not which government benefits, but rather it is whether the enforcement effort is up to some common standard.

We feel we are meeting the requirements of the act for enforcement, and that we meet or exceed what could be considered a standard level of enforcement activity.

It is difficult to know exactly what an ideal level of activity is, and comparisons between this jurisdiction and other jurisdictions are very difficult. However, on a comparative basis, we appear to come out reasonably well and seem to be receiving tax on a higher per capita volume of commodities than our neighbours do. For example, the Yukon taxes 92 packages of cigarettes per capita. While we do not have figures for Quebec, this is by far the highest in Canada, the closest being the Northwest Territories, where they receive tax on 75 packages per capita. The lowest is Ontario, which receives tax on 44 packages for each of its citizens.

The Yukon receives fuel tax on 2,970 litres per capita. While we do not have figures for all of Canada, this is considerably higher than Ontario, Manitoba, Saskatchewan or Alberta. Saskatchewan has the next highest level, at 2,260 litres per capita. Ontario has the lowest, at 1,489 litres per capita.

In terms of resources devoted to commodity tax administration collection, the Yukon seems to be about average on a per capita basis among the jurisdictions that we surveyed.

Yukoners devote more per capita resources to these activities than Saskatchewan, Alberta and British Columbia, but less than Prince Edward Island, the Northwest Territories and Manitoba. Yukon has one commodity tax person for every 10,000 population. Prince Edward Island has 2.4 such persons, and is the highest among those surveyed, while Saskatchewan has only one-tenth of a person, and is the lowest.

Alberta and B.C. have one-third and two-thirds of a person, respectively.

It is apparent that the comparisons of volumes of taxable products per capita are fraught with difficulties. Tax exemptions, resident per capita consumption, numbers of tourists, et cetera, can all have an impact on these figures. However, the fact that our taxable volumes are considerably higher than any other jurisdictions that were surveyed probably indicates that the compliance with our acts is quite good.

By the same token, comparisons of resources per capita devoted to these activities is also subject to interpretation. Factors such as exemptions under various jurisdictions' acts and economies of scale tend to skew those figures. Once again, though, being in the mid-range of commodity tax persons per capita probably indicates that we are enforcing our acts more or less to the provincial standard.

We have no reason to suspect any further non-compliance with our acts, but that does not mean more resources would not yield more money.

Whether or not they would yield enough to pay for the additional resources, setting aside the perversity factor, is a very moot question. Given the figures I have just mentioned, we do not believe so but we cannot prove it one way or another.

Obviously, the equity question is independent of the financial question, but once again we believe that the vast bulk of taxes due are being collected and that additional resources will result in few, if any, additional taxes being gained.

Then I believe one would have to say equity concerns are being met.

Several factors contribute to our belief. Firstly, all provinces and territories share information and, should another jurisdiction's work result in finding information that may indicate our taxes are being evaded, we are so notified.

The Member may recall just such a circumstance when he was the Minister.

Secondly, we live in a small jurisdiction with a limited number of tax collection points and a limited number of points of entry. In addition, our small size makes everyone's business better known to others, and we do on occasion receive tips from the public on potential tax evasion. We do carry out occasional field audits on commodity taxes in addition to the normal desk audits that check for reasonableness of quantities reported and taxes paid. Desk audits are normally conducted by commodity tax clerks whereas field audits are normally done by the director of revenue services and the ADM of financial operations of revenue services.

Field audits have been carried out in the past year and one-half, in addition to a number of inspections of the inventories of tobacco retailers. The net results of these audits was a refund of $36,842 in fuel tax to a taxpayer. This, in fact, may point out a different issue that may impact Yukoners, rather than the under-reporting of commodities tax values. Because our tax rates are lower than those in our two neighboring jurisdictions, there may be some incentive to channel transactions through the Yukon.

The Member also asked if it was fair that taxes could be paid late without interest being charged. I replied that no, it would not be fair. The practice in this territory is that the government pays interest on overdue accounts and charges interest on its accounts receivable. This policy was instituted by the side opposite when it was in power, although there were exceptions. For example, accounts owing to government that are under $100 are not charged interest. Other governments are not charged interest, since they generally refuse to pay it anyway. In addition, YTG has never charged interest on overdue commodity taxes and has never paid interest on commodity tax refunds.

I have no idea what the original reason was for not charging interest on overdue taxes, but there may be some problem in doing it now. First, since it has never charged before, it is not in our formula base. Since any interest so charged would likely be subjected to the diversity factor, we would lose $1.50 for every dollar charged, in addition to not having the monies from such interest in the first place - we would be getting a double whammy. Second, it would seem only equitable that if interest was charged on overdue commodity accounts, we would have to pay interest on overpayments and refunds.

There are relatively few late payments, and any interest gained, discounting losses due to perversity, is relatively small. In 1993-94, interest at 10 percent on overdue taxes would have amounted to $4,373.00. Unfortunately, the interest that we would have had to pay on refunds would have come to $17,500. In essence, there would have been a loss in excess of $13,000.

There may also be a third technical problem involved in charging interest. It may require the establishment of accounts receivable on our books. Should the taxes then prove uncollectable, we would have a bad-debt expense, but a recorded revenue that we never received would have gone to offset our formula grant. The above calculations of interest due may be somewhat overstated, since it was done from the date fuel tax returns were received, but some wholesalers wire us money and then mail in their return. Therefore, in some cases, there may not in fact have been a late payment.

We do have the ability to level penalties but, once again, to our knowledge, YTG has never done so. Generally, these would fall upon local wholesalers. In principle, penalties are regressive, in that a 10 percent penalty levied against someone who is 100 days late in paying yields a lower effective rate of interest than it would on someone who is only one day late.

The Member thought that we may be consistently underestimating revenue from commodity taxes due to us. We do not believe this is true. In our first budget in 1993-94, we estimated $11.9 million in the mains. The actual figure was $10.6 million. This, of course, was due to the shutdown of the Curragh operations. In 1994-95, we budgeted $12 million in the mains and are now projecting $12.3 million in the first supplementary. Once again, I believe that the work at Faro would account for the difference.

I hope that these have addressed the concerns of the Member opposite. In summary, both the resourcing of the commodity tax unit, the policy of not charging interest penalties on overdue accounts and of not paying interest on overdue commodity prices have not changed since the Members opposite were in power.

I have some handouts that will, I believe, address the other questions regarding administrative procedures and quality of the product.

Mr. Chair, in view of the time, I move you report progress on Bill No. 3.

Motion agreed to

Hon. Mr. Fisher: 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 Committee of the Whole?

Mr. Abel: Committee of the Whole has considered 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 Committee of the Whole. Are you agreed?

Some Hon. Members: Agreed.

Speaker: I declare the report carried.

The time being 5:30 p.m., this House now stands adjourned until 1:30 p.m. tomorrow.

The House adjourned at 5:30 p.m.

The following Sessional Paper was tabled January 24, 1995:

95-2-37

NorthwesTel's rate rebalancing application: letter respecting process, dated January 23, 1995, to Government Leader from Secretary General, CRTC (Ostashek)