Whitehorse, Yukon

Wednesday, March 27, 1996 - 1:30 p.m.

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



Speaker: We will proceed at this time with the Order Paper.

Are there any introductions of visitors?

Are there any returns or documents for tabling?


Hon. Mr. Fisher: I have the Yukon health status report for tabling.

Are there any reports of committees?



Petition No. 9

Ms. Moorcroft: I have to present a petition, which shows that the Government of Yukon directed the Commissioner to remove caveats from properties at M'Clintock Place in the Marsh Lake area without informing the property owners who were affected by this withdrawal of caveat. It also shows that the residents of M'Clintock Place believe that Lot 60 should remain reserved for use as a playground and to provide a public well for the use and benefit of each and every numbered lot.

The petitioners have asked the government to take such action as necessary to restore the effect of the original caveat and to ensure that Lot 60 in M'Clintock Place remains available for public use.

I look forward to the government's response to this petition.

Speaker: Are there any bills to be introduced?

Are there any notices of motion?

Are there any ministerial statements?


1994 Yukon Health Status Report

Hon. Mr. Fisher: Just a few moments ago, I tabled the 1994 Yukon health status report. This report represents three years of data on the health of Yukon residents. The health status report is like a report card on the health of Yukon people. It presents and analyzes information from a wide variety of sources to provide insight into selected measures of health and well-being in the Yukon. Some of the measures in the report provide a snapshot in time - for example, how Yukoners compare to other Canadians in one particular year. Other measures are able to show trends in the health of our population over time, so we can see how and where things are changing.

The Yukon's first health status report came out in 1991 and a new report will be prepared every three years. The 1994 health status report was released in October 1995 and has been well received by the public and Yukon's medical community. The 1994 report was given excellent direction by its steering committee, which was comprised of representatives from the Yukon Medical Association, the Council for Yukon First Nations, the Yukon Registered Nurses Association, the federal medical services branch and the Department of Health and Social Services. Expert insight and interpretation was provided by three senior members of the Department of Health Care and Epidemiology at the University of British Columbia.

The report indicates a number of areas where the Yukon is strong or where we have shown improvement over the past several years. Since 1991, with the introduction of seatbelt legislation, regular use of seatbelts in the Yukon has risen dramatically from less than half to more than 85 percent of Yukoners, but we still need further improvement to match the Canadian rate of 91 percent.

Infant mortality and low birth weight rates, which were identified as problem areas in the 1991 report, have shown a marked improvement and we now know the data in the 1994 report on these matters does represent all children of Yukon residents, regardless of where the children were born or died, and is therefore complete and reliable. It means that we can confidently say that the improvements are real, and Yukon rates are close to the Canadian average. This is good news.

On another topic, in contrast to the rest of Canada, Yukoners become more active as they get older. Elderly Yukoners are also happier and healthier than their Canadian peers.

There are also areas where improvement is needed in order to improve the overall health and well-being of Yukoners.

One key problem area is the number of accidents and injuries in the Yukon, especially among males under the age of 35 years. This translates into a lower life expectancy for Yukon males than Canadian males. Also, Yukoners tend to smoke more than the Canadian average. A lot of people who ride on snowmobiles and ATVs drink before riding on these vehicles and helmet use is much lower than it should be. Yukoners between the ages of 15 and 24 rate their health and happiness somewhat lower than their Canadian peers.

Most governments across Canada have some form of health status reporting in place; however, the Yukon is able to report on some very important topics that other provinces and territories are unable to report on, due to some of the excellent surveys and research that have been designed and completed in the Yukon. For example, the Yukon has much broader and better data on the link between social, emotional, spiritual and physical health than any other jurisdiction. The quality and depth of our data on alcohol, drug and tobacco use surpasses that available in all other provinces and territories. I hope the Yukon will continue to lead the rest of Canada in these areas in the future.

Progress has already been made on the recommendations within the 1994 health status report. A more in-depth analysis about the health and happiness of 15 to 24 year olds, based on the data from the 1993 Yukon health promotion survey, will be released later this year. Steps are underway to take a more detailed look at accidents and injuries in the Yukon.

The health status report is meant to be useful and used. It is designed to provide information, encourage discussion and support informed decision making. It does not prescribe the answers, because all Yukoners need to be involved in creating answers and putting them into place. My hope is that the health status report provides a solid foundation for this kind of forward movement.

Ms. Moorcroft: I rise to respond to the ministerial statement on the 1994 Yukon health status report.

This report was compiled with the participation of numerous representatives and contains some valuable information on health trends in the Yukon over the last three years. It can be used as an effective tool in defining the focus of health programs and treatments in the near future, particularly because the health system's resources may be curtailed with federal transfer cuts.

The report was released publicly six months ago, so I am disappointed about the government's lack of progress with some of the problems identified in the health status report.

In his statement, the Minister listed numerous statistics and congratulated his government on its statistical gathering techniques, but there was no reference to programs that will reduce the level of infant mortality in the Yukon. There was no indication about what preventive measures might be taken to reduce smoking, such as banning cigarette smoking on school grounds. There was nothing about reducing alcohol consumption.

The Minister referred to the fact that many people drink and drive before riding snowmobiles and ATVs. I think that the public awareness campaign on drinking and driving has been effective in reducing the number of accidents on the highways, and that we have to extend this to off-road vehicles.

I hope, too, that the Minister has adopted a comprehensive approach that will include the departments of Justice and Education in the study being conducted on the health and happiness of 15 to 24 year olds. Good health is not just about medical statistics and medical treatment; it is about fitness and well-being in our homes and in our communities. Good health care must address the whole person.

I would remind the Minister that, in its closing remarks, the report's steering committee emphasized that the purpose of the document was to identify priorities for more practical action for Yukon's health system. I hope that this information will be used to improve the health of our citizens and communities and will not be hidden away on the Minister's bookshelf.

In this regard, I look forward to hearing more about government initiatives stemming from the health status report in the near future.

Hon. Mr. Fisher: I thank the Member opposite for her observation and her words. There does have to be more analysis done on the report. The department is looking at ways of implementing recommendations and findings that have come out of the report, and I think that Members will see additional information coming forward in the next couple of years.

Speaker: This then brings us to the Question Period.


Question re: Canadian Utilities Company, management contract

Mr. McDonald: I have a question for the Minister responsible for the Energy Corporation. The Minister will know that the management contract between the Yukon Energy Corporation and the Canadian Utilities Company expires next March and, if the government wishes to go to tender, it must give notice by this Sunday - by the end of March 1996. The contract to manage the assets of the Energy Corporation needs the approval, of course, of not only the corporation board, but also the Minister. Can I ask the Minister whether or not he plans to retender the contract, and if not, why not?

Hon. Mr. Ostashek: The Member's information in his preamble is correct. Because of the general rate application hearing, we have deferred dealing with the management contract until May 1, if I am not mistaken. That was a mutual agreement with YECL, who does the management for us.

As to whether or not we will be renewing the contract, that has not been addressed yet. There are some outstanding issues that we want to deal with in the management contract.

Mr. McDonald: The Yukon Energy Corporation, in response to some requests for information during those public utilities hearings, indicated that it had no intention of re-tendering the contract, but that it might discuss some of the details associated with the contract. Perhaps the Minister could either confirm or reject that notion. Can he tell us as well whether or not the corporation, or the government itself, is going to be taking any other steps to explore other options for managing the Yukon Energy Corporation assets for less than the current management fee?

Hon. Mr. Ostashek: As I said in my opening comments, these are the issues that will be addressed when we get into the review. The review has been deferred by mutual agreement of the Yukon Energy Corporation and the Yukon Electrical Company Ltd., so it does not preclude us from going out to tender if necessary. There is a mutual agreement that the review of the management contract will be deferred. All these issues will be dealt with in that review.

Mr. McDonald: On December 18, the Yukon Energy Corporation explained in answer to a question by the Utilities Consumers Group, which I will quote briefly, "The corporation does not propose to tender the management agreement contract, which includes provisions for the coordinated management of the Yukon Energy Corporation and the Yukon Electrical Company Ltd. power facilities."

Can the Minister tell us if that intention is not the case? Can the Minister tell us whether or not the government will be issuing guidelines to the Yukon Energy Corporation on any renegotiation of the contract?

Hon. Mr. Ostashek: I missed the first part of the question. If the Member could repeat it without being penalized for a question, I would appreciate it.

Mr. McDonald: I gave the Minister a quote from a response by the Yukon Energy Corporation to the Utilities Consumers Group, which indicated there was no intention to retender the contract. I wanted the Minister to either confirm or reject that notion.

Hon. Mr. Ostashek: I cannot do that while on my feet, but I will certainly bring the information back for the Member. I know there are some concerns with the management contract that the corporation wants to address, but I cannot confirm that for the Member while on my feet. I will bring that information back for him.

Question re: Canadian Utilities Company, management contract

Mr. McDonald: The management contract specifies that the parties will negotiate an adjustment in the management fee, "...if there occurs a material reallocation of assets between the system and Yukon Electrical's separate business."

Since 1987, Yukon Electrical's rate base has increased 300 percent, including the projected five percent for this coming year, while the Yukon Energy Corporation's rate base has increased only 14 percent from 1988 to 1996. It is expected to decline next year.

Does the Minister believe that the current management fee of approximately $800,000 is appropriate under these circumstances?

Hon. Mr. Ostashek: The Member goes back to 1987, but the contract was renewed in 1992. At this point, it is coming up for the second five-year renewal. It was renewed just prior to our taking office, or it was agreed to be renewed at that time.

Do I agree with the division of assets and the return? These are concerns of ours, and these are concerns we want to address before we commit to signing a new contract.

Mr. McDonald: Does the Minister believe, as a matter of policy, that it would be fair for ratepayers to continue paying this high management fee of $800,000 - the same that it has been for years - every year to the Yukon Electrical Company Ltd. to manage public assets when its control of the system's assets is proportionately increasing dramatically?

Hon. Mr. Ostashek: This is an issue that has been around for a long time and I know that the previous administration under the former leader had entered into negotiations with the Yukon Electrical Company Ltd. for the rationalization of assets, because I guess there were concerns about the potential of what is now happening.

I do not think this is fair, but I do not have all of the details for the Member opposite, but I will bring back whatever information I can. I know that they have not gotten into the details and they have not come to us for direction at this point as to what they will be looking for in the new management contract.

Mr. McDonald: I thank the Minister for that answer. Despite the fact that the rate base for the Yukon Electrical Company has risen dramatically over the period of both contract terms, it is also selling off valuable Yukon lands to its parent company, Canadian Utilities, such as the Fish Lake Road and some property in the downtown area, for a token amount. Does the Minister believe that this sort of action is appropriate and does he plan to take that into consideration in the re-negotiation of the management contract?

Hon. Mr. Ostashek: I do not believe that I am in a position to comment on that, because those are the issues that are dealt with by the Yukon Utilities Board. They dealt with those issues at the last rate hearing. With respect to the land that was transferred to the parent company, I can remember the controversy about it and the Yukon Utilities Board disallowed some of the transfer at the amount of money that was dedicated to it.

I believe this all falls under the guidance of the Yukon Utilities Board, which is the watchdog of the companies, and all of the assets that the companies have come under the scrutiny of that board.

Question re: Fetal alcohol syndrome

Mr. Cable: I have some questions for the Minister of Health and Social Services about fetal alcohol syndrome.

Last year, during the budget debate, the Minister's predecessor was talking about getting a handle on fetal alcohol syndrome in schools. The Minister said, "We certainly have every reason to believe that it is a problem of epidemic proportions in our schools." Does the new Minister of Health and Social Services agree with that statement?

Hon. Mr. Fisher: Yes, I agree with the statements made by the previous Minister, but again, since I am the new Minister for this portfolio, I have not been fully briefed on all of the problems and effects of fetal alcohol syndrome and fetal alcohol effects.

Mr. Cable: Last April, the government announced its fetal alcohol syndrome prevention plan. The plan sets out, and I quote, "There is no reliable information in the Yukon that tells us how many people have fetal alcohol syndrome and fetal alcohol effects - who these individuals are and who is at risk of giving birth to children with fetal alcohol syndrome and fetal alcohol effects." The plan went on to say that a research project will provide that information. Immediately below that entry is a description for a $200,000 research project, which I assume is the one that is talked about immediately above. It says that the project is slated for completion in February 1996. Could the Minister tell us whether or not this project has been completed?

Hon. Mr. Fisher: I do not believe that it has at this point in time - at least, I have not been made aware of the findings.

Mr. Cable: If in fact there is an epidemic going through the schools, or about to go through them, could the Minister tell us here today, or in a legislative return, what is being done with the education partners - the Department of Education and the teachers - to determine what has to be done in staffing and costs to meet this epidemic?

Hon. Mr. Fisher: I am not sure if it is an actual epidemic. However, I will be glad to get back to the Members opposite with a legislative return outlining the program and where we are with it.

Question re: Hunting licence, eligibility

Mr. Harding: I have a question for the same Minister about the issue of residency surrounding the availability of Yukon resident hunting licences.

Yesterday's comments about this issue by the Minister in the Legislature in Question Period and subsequent comments by the department this morning on the radio have kicked open a can of worms.

I have a question for the Minister about the investigation that he told us yesterday in the House was "thorough and complete." This morning on CBC Radio, the department reported that the investigation was not complete and was still ongoing.

I would like to ask the Minister the following question: is the investigation complete or not?

Hon. Mr. Fisher: My information is that the file for the investigation is still open and will remain open for some time. As far as initial work is concerned, I do not know the details about how the investigation was carried out. However, the general work of the investigation is complete.

Mr. Harding: I do not know quite what to make of that. Yesterday, the investigation was thorough and complete, according to the Minister. Today, he says that the file is still open and that he is not quite sure. He equivocates all over the place.

I would like to ask the Minister if he will provide for this House tomorrow a copy of the process and findings of the investigation, as the file stands right now, and also a copy of the affidavit that I asked for yesterday.

Hon. Mr. Fisher: I would just like to correct something in Hansard. The department thoroughly investigated Mr. Mayr-Melnhof to try to determine if the allegations the Member opposite has been making in the Legislature are in fact true. The last I heard, which was some time last fall, the department was unable to prove that Mr. Mayr-Melnhof was not exactly as he had claimed to be; that is, a resident of the Yukon Territory. I would like to point out to the Members that there have been questions regarding residency requirements going back to May of 1986. There are something like nine different legal opinions, seven of which were made while the Opposition was in government, and two since that time. The person they are referring to, Mr. Mayr-Melnhof, was granted landed immigrant status in Canada in 1973. He has been living in Yukon for nine years - nearly as long as the Member opposite, who keeps bringing up the questions.

Mr. Harding: The Minister must be from another planet. I talked to dozens of Yukoners who know and who work with this gentleman and they say he is in this territory a total of maybe two to three months a year. He owns some property here and he owns some pieces of outfitting businesses but to say that he lives here is stretching it to the nth degree.

I would like to ask that Minister again, after that futile attempt at deflection, if he would provide for this House tomorrow a copy of the process of this investigation and the findings as well as this so-called affidavit, which was signed by this person and delivered to this government.

Would he do that for us tomorrow?

Hon. Mr. Fisher: The affidavit, as I said yesterday in the House, is not public knowledge because of information contained on it. The investigation, again, is not public knowledge. As such, I will not table it in the House.

Question re: Hunting licence, eligibility

Mr. Harding: Since the government chooses to cover that up, I will go to the other contradiction that was raised by the government and the department.

Yesterday, the Minister said that the Wildlife Act law would prevail over any comments in the synopsis about residency. This morning, we found out that the government has changed the synopsis to reflect its arbitrary view of the law. I would like to ask the Minister if the government is now going to be changing the Yukon residency provisions in the Wildlife Act law, or will it be changing the synopsis back to reflect that law?

Hon. Mr. Fisher: The Wildlife Act will have to be changed because it does not meet the requirements of the Charter of Rights and Freedoms.

Mr. Harding: Now we are getting somewhere. Now I am finding out that this government is engaging in the process of declaring open season on Yukon residency for the purposes of hunting licences and residency requirements.

I would like to ask the Minister why, instead of defending what Yukoners want with regard to residency and then having rich outsiders try and force a challenge, this government is succumbing to this without even testing this for the benefit of Yukoners who want to protect residency.

Hon. Mr. Fisher: These are questions that were asked of that government as far back as 1986. The legal opinions are such that the Wildlife Act is in contravention of the Charter of Rights and Freedoms.

Those Members would not do anything about it. They were right. They had seven legal opinions; we have had two. Each one says that the Wildlife Act in is contravention of the Charter of Rights and Freedoms.

Mr. Harding: This government, along with outfitters who later lost their concessions, raised the issue of the charter hocus-pocus the last time I raised the question of outfitting ownership. They provided no proof and they never tested anything.

I would like to ask this Minister why, instead of mickey-mousing with the laws, they do not enforce -

Unparliamentary language

Speaker: Order. Would the Member please refrain from making personal attacks, as implied with words like "Mickey Mouse".

Mr. Harding: I will respect your ruling, Mr. Speaker, and comment later.

Instead of messing around with the laws, why do they not enforce the residency provisions that Yukoners want, and let rich non-residents challenge the law if they so wish?

Hon. Mr. Fisher: Maybe the Member should ask his leader, the Leader of the Official Opposition. As I said, there have been numerous legal opinions and in each case it was said that we are in contravention. Why would anyone put another person through that, when it is known that we are going to lose?

Question re: Hunting licence, eligibility

Mr. Harding: The government does not know that it is going to lose anything. The government yanked the two concessions from people a year ago in this territory, because the requirements of the residency provisions of the act were not met. This government has not given us the affidavit, the process or the findings of the investigation of this residency question, and cannot tell us why it will not uphold the law. I would like to ask the Minister why, rather than succumbing to this, the government does not defend the interests of Yukon residency that it should be upholding and let the outsiders challenge it. Have they challenged it?

Hon. Mr. Fisher: Why did the NDP government not do the same thing?

Mr. Harding: It is a very lame attempt at deflection. This is the government, and we cannot hold the hands of its Ministers forever. We were defeated in 1992. This government has been in power for three and a half years now. The Ministers have to learn how to crawl, walk and, sooner or later, to run - but I do not know if they are going to have time for that.

Again, I ask the Minister a very serious question. This is a person who is in the Yukon for two, three or four months of the year, and who owns a bit of property here and a piece of some businesses. If this person can qualify to be a Yukon resident, then I would like to ask the Minister what the threshold is for this government, because this has ramifications for Yukon resident hunters, First Nations and the outfitting industry, who rely on non-resident hunters for their business.

Hon. Mr. Fisher: The residency threshold is dealt with in the Canadian Charter of Rights and Freedoms.

Mr. Harding: That is preposterous. The Charter of Rights and Freedoms speaks to mobility for the purpose of earning a living. It does not speak to the ability of a jurisdiction to enforce residency provisions for the purchasing of hunting licences. This is being stretched beyond the preposterous. I would like to ask the Minister what the Yukon threshold is, because it is clear in the Wildlife Act, which is the law, what this government should be doing. What is the Yukon Party threshold for residency - is it the Wildlife Act or is it the Yukon Party's own arbitrary view?

Hon. Mr. Fisher: It is the same as with the NDP. It goes back to 1990.

Question re: Yukon Housing Corporation, credit card use

Mrs. Firth: I have a general policy question for the Government Leader.

There are currently 11 VISA credit cards for the Yukon Housing Corporation: one for the chair of the board and 10 for employees, which are made out in their own names. Research throughout the Department of Finance shows that the Yukon Housing Corporation is the only government agency or department to have VISA cards. For two years, the Auditor General has criticized the Housing Corporation for abusing the use of these cards, saying that the findings have been reported in each of the two years with no resulting improvements, that immediate attention should be given to the matter and that the corporation should discontinue the use of the credit cards.

I would like to ask the Government Leader if he will provide direction, through the Management Board, to discontinue the use of the VISA cards?

Hon. Mr. Nordling: This was discussed in some detail during debate on the Yukon Housing Corporation supplementary estimates, and I think it was explained clearly at that time.

Mrs. Firth: It was not clearly explained because the Minister who just responded to the question thought it was a good idea and he did not want to discontinue their use, but he could not tell us what controls were in place. All I got was a lot of bureaucratic babble.

From research through the Department of Finance and other departments, I understand that the government is considering the use VISA credit cards for the whole government. I would like to ask the Government Leader what his position is regarding this. Does he support government employees having their own VISA cards?

Hon. Mr. Nordling: The Member said that I could not tell her in the debate on the supplementary estimates what controls were in place. That is not true. We talked about the credit card policy coming in October 1995, and we talked about the very close scrutiny of the credit cards, the statements and the expenses submitted by the employees.

Mrs. Firth: People can read pages 2689 in Hansard to see what the Minister's knowledge of it was.

I want to direct my final supplementary back to the Government Leader, because I want my position very clear on the record. I think the Yukon Housing Corporation should have all its VISA cards cut up and the accounts closed. No government department or agency should be allowed to use Visa cards. The potential for abuse far outweighs any benefits.

Will the Government Leader stop spending valuable time working on a policy to give government employees VISA cards and move on to something more pressing and important?

Hon. Mr. Ostashek: I am not aware that we are working on a policy for this. The use of credit cards for government departments has not come forward to Management Board or Cabinet at this point.

Some Hon. Member: (Inaudible)

Hon. Mr. Ostashek: There may be some internal talk about it, but no policy is being developed at this point. It has not come forward to us for approval. I will take the Member's concerns into consideration. I have listened to them and will use them appropriately.

Question re: Hunting licences, eligibility

Mr. Harding: I have another question for the Minister of Renewable Resources, same subject.

The government announced today it will be opening up the Wildlife Act to residency provisions and removing some Yukon hunters residency protection.

When does the Minister intend to make this change to coincide with the synopsis changes he has already made?

Hon. Mr. Fisher: There are other amendments in the Wildlife Act required besides this. I expect it will come through the Legislature during the spring session of 1997.

Mr. Harding: We have a government that has changed the synopsis but failed to come into this Legislature to debate this very serious issue about Yukon residency, because it is afraid of that debate.

I have very grave concerns about this. Can the Minister tell us if the government will talk to the Yukon Fish and Game Association, the Outfitters Association and the Yukon Fish and Wildlife Management Board before it does something arbitrary that will hurt our Yukon residency protection?

Hon. Mr. Fisher: Certainly. The Fish and Wildlife Management Board is considering the matter right now; in fact, I thought I would have recommendations back from it with respect to foreign ownership of outfitting concessions. We deal with the Fish and Game Association on an ongoing basis so certainly we would be consulting with those groups that were mentioned.

Mr. Harding: I find the government's approach to this very disconcerting. I would like to ask the Minister one more time today: instead of turtling on this question of the protection of Yukon residency rights, why will he not allow the law to be upheld in the Yukon and make a rich outsider challenge that law. The government cannot tell me here for sure that it is going to lose.

Hon. Mr. Fisher: The Member knows very well that the government of that party issued a licence to this gentleman back in 1990 and had seven level opinions indicating that the gentleman was in fact a Yukon resident. The department has recognized landed immigrants as residents since 1990.

Speaker: The time for Question Period has now elapsed.




Clerk: Motion No. 104, standing in the name of Mr. Phelps.

Motion No. 104

Speaker: It is moved by the Member for Ross River-Southern Lakes:

THAT this House recommends that the Commissioner in Executive Council establish a public inquiry, pursuant to the Public Inquiries Act, for the purpose of investigating the apparent conflict of interest and apparent breach of the Executive Council Code of Conduct Regarding Conflict of Interest tabled in the Legislative Assembly on April 6, 1981 and the Code of Ethics for Members of the Executive Council (established by Schedule B of Order-in-Council 1981/085 under the Yukon Act), arising from:

(a) the assembly and purchase of certain fee simple lots in Block "B", Plan 19005, in the City of Whitehorse in the Yukon Territory;

(b) the involvement in this assembly and purchase by relatives, acquaintances and certain political staff of one Member of the Executive Council, namely Piers McDonald, during the terms of the 26th and 27th Legislative Assemblies;

(c) the involvement in this assembly and purchase by Maurice Byblow, his relatives and acquaintances during the term of the 26th Legislative Assembly, when Mr. Byblow served as an executive assistant to Mr. McDonald, and during the term of the 27th Legislative Assembly, when Mr. Byblow was a Member of the Executive Council; and

(d) the actions being taken by the Government of Yukon during the time of this assembly and purchase with respect to examining the feasibility of and options for acquiring and, later, negotiating the possible purchase of the White Pass and Yukon Railway right-of-way adjacent to the said fee simple lots;


THAT this House recommends that the Commissioner in Executive Council direct the board established to conduct the public inquiry to:

(a) include in its report the following:

(i) decisions as to whether either or both Mr. McDonald and Mr. Byblow were in a conflict of interest; and

(ii) reasons for its decisions;


(b) transmit its report to:

(i) the Commissioner in Executive Council (pursuant to section 3 of the Public Inquiries Act), and

(ii) the Legislative Assembly (by delivery of the report to the Speaker of the Legislative Assembly who shall table the report in the Assembly as soon as practicable or, if the Assembly is not then sitting, who shall immediately transmit the report to all Members of the Assembly).

Hon. Mr. Phelps: I have some documents that I would like to table and distribute to all Members in the House. I have 17 copies of a booklet entitled, "Motion 104", for distribution and tabling. While it is being tabled, I will begin.

Firstly, of course, standing in support of a motion such as this is not something that one particularly enjoys. I share that sentiment with others who have stood in this House and given that preamble during Question Period and on other occasions. However, sometimes one is faced with the prospect of doing something about an appearance of conflict that is very deep and very grave.

I have chosen to come before this House and propose this motion and give reasons for the motion, because I feel that all Members should support a thorough investigation of the facts to which the evidence I am adducing gives rise. Also, because I believe that the appropriate vehicle for conducting such an investigation is through the provisions of the Public Inquiries Act, I would like to talk about this act at the outset.

The Public Inquiries Act allows the appointed commission to compel evidence, to subpoena all kinds of documents and to hear evidence under oath. The act is not limited in its scope and, in this case, one of the persons named in the motion that we are debating is no longer a private Member of the Legislature. He has left these precincts and is in private life; therefore, I believe the best way to proceed is through the provisions of the Public Inquiries Act.

I want to begin by speaking about the Code of Ethics that each Member of Cabinet has sworn to uphold and must abide by.

I have set out Schedule B, entitled "Code of Ethics", under Order-in-Council 1981/085 of the Yukon Act. The first point that has to be underscored, which I will be coming back to later, is the very high standard that is set by this law. It is an extremely high standard. One will note, under the first section - it is a very short code - it says that a Member shall ensure that all his affairs are conducted and that no conflict arises and no conflict appears - I would underline the word "appears" - to arise between his private interests and his public duty.

It is not just to avoid an actual conflict of interest. The standard is much higher than that. The standard speaks to the appearance of a conflict of interest. In this document, I draw Members' attention to paragraph 3. It speaks about a Member not using information privy to the Executive Council in such a way as to derive profit or advantage for himself, his family, friends or associates.

I would also point out the importance of paragraph 5, which states in effect that, when a matter comes before a department, the Minister responsible for that department, where there is a personal interest that might be construed as influencing the impartiality of his judgment, the Minister shall bring the matter to the attention of his Cabinet colleagues - the Executive Council - and request that a colleague be appointed to act for the department concerned for the purpose of dealing with that matter.

Just over the page - a brief comment on the code of conduct regarding conflict of interest. I draw your attention to 2.(2) on the first page, which says "No Member nor any of his family shall engage in any employment, business or profession that actually or apparently" - again, apparently - "causes a conflict of interest with his duties as Member or might reasonably be expected to create such a conflict during his term of office."

In the document I have read from, paragraph 1.(1)(a) defines "family" in the following way: "family" means a Member's spouse and dependents that normally reside with him." I would venture to submit that "spouse" would include "common-law spouse," but then I am not here to recite my interpretation of the law.

Tab 2 contains a map that shows the downtown Whitehorse area. It shows the block of land in question, its relationship to the British Yukon Railway right-of-way, the land's relationship to the SS Klondike, Rotary Park, the administration building and other areas of interest in the Yukon. Currently, if one were to go for a walk along the south access that leads to town, one will see that the land in question, in Block B, Plan 19005, is separated from one of the main entranceways into town - the South Access Road - by the railway right-of-way and a high fence.

We know that in 1987 government officials were having internal discussions about proposals to develop the waterfront in the City of Whitehorse and they were looking at the roles of the major players, and by that I mean, in particular, the White Pass and Yukon Corporation, YTG, of course, and the City of Whitehorse, among others, and possibly First Nations. They were discussing internally the possible scope of the development, and the possibility of acquiring through purchase or expropriation all or portions of the railway right-of-way in the downtown area.

In those discussions, of course, Community and Transportation Services would be the lead department. That is the department that deals primarily with the communities in the Yukon and, in this case, the City of Whitehorse. That was and is the department in charge of land. While other departments had an interest in possible waterfront development, including, just off the top of my head, Tourism and others, the lead role was to be played by that department, and the Minister of that department was Piers McDonald in 1987.

Ofelia Andrade is the wife of Piers McDonald. Maurice Byblow, up until the election of February 1989, was the executive assistant to Piers McDonald. Janet Pauch was the administrative assistant to Piers McDonald. Barry Stuart was the Yukon territorial land claims negotiator. A numbered company, 6660 Yukon Ltd., was incorporated in July 1987, and the shareholders and officers were Maurice Byblow and Ofelia Andrade.

Another company that played a role in these matters leading up to the election of February 1989 is a company called Lyndax Development Corporation. It was incorporated in August 1988. The shareholders were Darryl Weigand and Lynda Weigand.

Before leaving Tab 2, I will simply comment on the tremendous location of the block in question, save and except for the barrier that is created between it and the South Access Road by the railway right-of-way.

To go back, Maurice Byblow and Janet Pauch were really the political staff of the Minister during this time, as opposed to the ordinary officials who work for government.

If one moves to Tab 3 - depicted by a colour code is a larger map that shows a block in question showing the railway right-of-way, the South Access Road and the SS Klondike. The colour code shows the lots purchased by Sherwood Banks Inc., which we will get to later, the lot purchased by Barry Stuart, two lots purchased by 6660 Yukon Ltd., and one lot purchased by Janet Pauch.

To go through the actual transactions sequentially, I intend to speak to each of the purchases. As I go, I will table certificates of title that are pertinent to the discussions today.

The first group of transactions deal with purchases made prior to February 1989, when the general election took place. First, I would like to table some documents stapled together. I will describe them as all dealing with Lot 4, Block B, in Whitehorse, Yukon Territory, Plan 19005, Certificate of Title 87Y1063 and Certificate of Title 84Y985. In this case, I will file the two; that is all that is necessary.

The first purchase of interest is contained in those two certificates of title. On August 27, 1987, less than a month after 6660 Yukon Ltd. was formed, 6660 Yukon Ltd. purchased Lot 4. The price it paid was $60,000. The financing was by the Canadian Imperial Bank of Commerce, or its mortgage corporation. It is interesting to note that the previous owner had bought that land for $50,000 in September 1984 and that the amount paid over and above what the previous purchaser had paid was $10,000, or 20 percent.

On November 12, 1987, we have another purchase by the numbered company. I wish to table two certificates of title pertaining to Lot 1, Block B, Plan 19005, Certificates of Title Nos. 87Y1467 and 87Y160.

The numbered company 6660 Ltd. purchased Lot 1 for the price of $34,000, and financing was through the Canadian Imperial Bank of Commerce. The previous owner purchased that property for $28,000 in February of 1987. The premium paid to the person to buy this property - or the profit to the previous owner - is $6,000 or 21 percent.

Next, I have for tabling two certificates of title pertaining to Lot 5, Block B, Plan 19005, Certificate of Title No. 88Y302 and Certificate of Title No. 86Y237. These two certificates show that on March 30, 1988, Barry Stuart purchased Lot 5 for the sum of $92,000. The financing is through the Canadian Imperial Bank of Commerce. In this case, the previous owner had paid $63,000 in March 1986. So the profit, or the premium, to the previous owner was $29,000 in a two-year period or 46 percent.

Next, I wish to table two certificates of title pertaining to Lot 6, Block B, Plan 19005. They are Certificate of Title No. 88Y436 and Certificate of Title No. 87Y1011.

Those documents show that Janet Pauch purchased Lot 6 on April 28, 1988. She paid a price of $123,500. The purchase was financed by the Canadian Imperial Bank of Commerce. The previous owner bought the lot in August 1987 for $100,000. He was paid a profit of $23,500, or 23.5 percent.

Next, I wish to table three certificates of title, all of which pertain to Lot 2, Block B in Whitehorse, Plan 19005. These certificates of title are No. 88Y1222, No. 88Y1080 and No. 86Y763. I am tabling them in one bundle. They show that on August 30, 1988, Darryl Weigand and Lynda Weigand purchased Lot 2. They paid the price of $140,000. The financing was by the Canadian Imperial Bank of Commerce.

In July 1986, the previous owner bought that land for $106,000, and thus made a profit on the sale of $34,000, or 32 percent. In September, not quite a month later, Lyndax Development Corporation purchased Lot 2 from the Weigands. The price was $140,000, with the financing by the Canadian Imperial Bank of Commerce.

I spoke about Lyndax before. It was incorporated in August 1988, and the shareholders were the same Darryl and Lynda Weigand. That property was sold again, but after the general election of 1989, and I will get to it later.

These are the transactions that took place in a very short period of time, whereby two lots were purchased through a numbered company owned by the Minister's executive assistant and the Minister's wife.

One was purchased by his administrative assistant, one by Mr. Stuart, and one by the Weigands - the colour code shows which are which - and Lot 3 is a lot that was purchased later. Again, the coloured map shows just how significant the railway right-of-way is to the future of those lots.

Another point worth mentioning has to do with the official plan of the City of Whitehorse. It sets out the future land patterns for the city and, under the 1976 community plan, the area incorporating, in part, Lot B, Plan 19005, would be medium density. On February 26, 1987, Piers McDonald signed Bylaw 86-50. This bylaw adopted a new official community plan, allowing for the area containing the land in question, Lot B, Plan 19005, to be used for mixed service commercial medium density.

On the next page of the booklet that I have tabled, there is an explanation of the kinds of things that can be done under downtown commercial/residential mixed use. They include such things as apartment buildings, eating and/or drinking establishments, retail stores, hotels. It is interesting to note that that change had taken place not too far before this apparent land assembly took place.

The appearance of what has gone on is that people with inside information about what the government was entering into with White Pass and the city - people in the political office of the Minister, and his family - suddenly decided to form a numbered company and to purchase two lots right next to the railway right-of-way at a time when these issues were being discussed internally in government. The appearance of those two lots being purchased and another being purchased by the administrative assistant are akin to what is known in the jargon as "insider trading," where people being privy to information about what direction the government is moving that would have an impact on the railway right-of-way would assemble land, while the people selling the land, and others who may have been interested in participating, were at a severe disadvantage.

At the point at which these transactions took place, the Code of Ethics, in my view, was seriously breached because of the appearance of conflict.

Leading up to the first phase of all of this and leading up to the general election that took place in February 1989, there are some very serious questions that need to be answered. I, of course, cannot answer them, and it is my respectful submission - I will be getting back to this from time to time - that the appropriate way to get the answers to these questions and others that other people think of is by way of a mechanism that allows witnesses to be compelled to appear before the inquiry and give evidence under oath, a mechanism that allows for the subpoena of pertinent documents that are not in the public domain and which may only be within the knowledge, for all we know, of players other than the private Member who is still in this House.

The seriousness of this gets to the issue of exactly what was going on here. Was there some kind of conspiracy? These are all issues that the facts that I have alluded to up to this point in time certainly permit that type of distasteful perception to arise.

These are some of the questions then that the facts thus far in my presentation give rise to. I am certainly prepared to admit that there may be many other questions that I have not thought of, but in thinking about the significance of what has taken place in comparing, in my mind at least, the issue of insider trading to what I know has happened with regard to those kinds of occurrences in the stockmarket and elsewhere, it seems to me that there are some questions that need answering, particularly in view of the standard of conduct that is set out in Schedule B of O.I.C. 1981/085 of the Yukon Act - the appearance of conflict.

Some of the questions that arise include the following: did Piers McDonald and or members of his political staff have any conversations with Barry Stuart and/or the Weigands about the internal discussions going on in the Government of Yukon in 1987 regarding proposals to develop the waterfront and the probability that the railroad would never again operate in the downtown area of Whitehorse? Were any such discussions taken between all of these people, who bought and assembled these lots? Are those the kinds of discussions that led to what seems to be that type of assemblage? Exactly what kind of confidential information were the shareholders - the Minister's wife and the Minister's executive assistant - of 6660 privy to? Exactly what kind of confidential information was the administrative assistant made privy to? To what extent were the others brought in, if at all?

The next question is whether or not all or any of these same players - as part of that type of conversation - engaged in discussions and speculation about the possibility of part or all of the railway right-of-way in downtown Whitehorse being purchased or expropriated by the Yukon government? We know that those kinds of discussions were going on in 1987.

Did they, these same people, ever discuss the possibility of part or all of the railway right-of-way adjacent to the land in question, Block B, Plan 19005 - and of course going back to Tab 3, it is in shocking pink - did they ever discuss the possibility of it being used for widening and improving the South Access Road?

Again, we know that those kinds of questions were going on. The railway had been shut down since 1982. The South Access Road was badly in need of repair and upgrading. There were a lot of traffic problems at the intersection of the South Access Road and Second Avenue, just north of the bridge to Riverdale. Of course, if government was thinking about acquiring the railway for the purpose of improving, widening or doing whatever with the South Access Road, that would remove that barrier; it would go a long way, at least, to removing the barrier in place between these lots and the South Access Road.

Again, along the same line, did these people - the Minister, his wife, his executive assistant, his administrative assistant, or some of them - discuss the possibility of purchasing all or part of the railway right-of-way from White Pass or from the YTG?

Again, if one goes back to Tab 3, one can see just how valuable the addition of that land would be to the owners of lots 1, 2, 3, 4, 5, 6 and, indeed, probably Lot 7 as well, which was right adjacent to it. This is a question where there is another possibility of whether or not these kinds of discussions ever occurred.

Again, these are questions that we can find answers to through the mechanism of a public inquiry. I cannot think of other mechanisms because of the narrow kind of aspect of what this House can do regarding people who are private members of society and not existent Members of this House. I would make the argument that that difficulty applies even with regard to the powers of a Conflict Commissioner to be appointed under the new legislation, which has gone through this House, but has not been proclaimed and implemented.

What is key here is that this goes beyond privileges of the Members of the House, or at least has that potential. Of course, it depends on what additional evidence would be adduced and provided to the Commissioner under the Public Inquiries Act.

The next questions that arise go like this: were there any agreements made between all or some of the purchasers with regard to the said properties? Is there anything in writing? Anything binding? Any common understanding about what and how they might proceed once they acquired all of these lots? There are certainly many, many questions - I guess subcategories of this particular issue - they all use the same bank - that is another question, why did they all use the same bank, which just happens to be the bank that conducted the government's business, at least during that time? Was it felt that perhaps a Minister of the Crown had some special status with that bank? I do not know.

Were there agreements between any of these corporations or individuals with regard to sharing of revenues from the properties? We do not know, but we have cause to question whether or not there was some kind of agreement - again, because there are so many trails that lead to this destination.

For example, in the disclosure statement filed by Mr. McDonald, we do see the disclosure that his wife was a shareholder in 6660 Yukon Ltd., which owned two residences in Whitehorse. There is nothing about income from those properties, although I understand that they are revenue properties.

This question becomes more intriguing when one looks at how, later, other individuals were brought in as shareholders of a company called Sherwood Banks Inc. One again wonders what kind of agreements were in play, because we are talking about the assembly of six lots, ultimately, with the total purchase price in excess of $500,000. It would be very interesting to see whatever written agreements exist, if any. It would be very interesting to know what kind of arrangements were made with the bank - whether there was a shared arrangement by any of the purchasers involved.

There is the appearance of a conflict here that triggers the Code of Ethics. The standard for Ministers is much higher than for people in the general public. In my respectful view, these questions need answers.

Let us continue.

Did Piers McDonald or any of the purchasers of the lots tell the previous owners - those from whom the land was being bought - that the Yukon territorial government was involved in internal discussions about proposals to develop the waterfront in Whitehorse, and that these could lead to action that could impact on the status of the railway right-of-way adjacent to the lots and materially affect the value of those lots? Would fairness not dictate that the owner be advised?

How would any of the Members feel if they owned some lots and someone, on behalf of a numbered company, came along and bought them, and the Member later found out who the principals behind the numbered company were, and later found out that there were some plans for the railway beside these lots that could materially impact in a positive way on the value of those lots? How would one feel?

Why was a numbered company used? Did the Minister's wife or his executive assistant themselves approach the people to buy those lots or did they go through an agent and use a numbered company? Was there any disclosure about who was buying the lots and what their relationship was with the Minister who is responsible for dealing with land and municipalities in this government, and who is given a lead role with respect to preparations for negotiations involving these things and entering into discussions?

Another question that kind of flows from that has to do with this: why did they pay this premium for the lots? I have gone through, and tabled, certificates of title, which are, of course, public documents that are available to anyone, that show that the purchasers paid 20 percent, 21 percent, 46 percent, 23.5 percent and 32 percent premiums to buy these lots. They sure wanted those lots, for some reason. The inference is that if not for the discussions and information about where the government was moving with respect to the waterfront and the railway right-of-way, why would they want to pay such premiums?

The question ought to be answered, and I think it has to be answered by more than just the private Member. I think each of the players should be compelled to answer these kinds of questions.

Why did Ofelia Andrade and Maurice Byblow form a numbered company for the purpose of acquiring these lots? That company, as you may recall, was formed in July 1987, and the first purchase of lots by that company took place on August 27, 1987. The next purchase by the numbered company took place on November 12, 1987.

Why would they form a numbered company for this sole purpose? Again, were they trying to use an agent, or was there some way of trying to ensure that people owning property that they found so desirable would not know that there was an assembly of these lots? It is a fair question, on the information that we have. I do not understand why.

Prior to the transactions we have talked about - the purchase of the lots in question outlined previously - were the previous owners advised of who owned 6660 Yukon Ltd. and the relationship to the Minister responsible for community affairs and land - family and the senior political advisor? I think it is really important that that be answered. Were they advised that Janet Pauch was the Minister's administrative assistant?

Again, I think that is an issue that is extremely important.

I have asked the question as to why the purchasers we have named here all agreed to finance through the Canadian Imperial Bank of Commerce. Again, there is some evidence that shows some togetherness on the part of the purchasers.

Did Piers McDonald bring the matter of the purchase of the lots by his wife, his executive assistant, his administrative assistant and acquaintances to the attention of the Executive Council and request that a colleague be appointed to act for the department for the purpose of dealing with all aspects of the proposed waterfront development and negotiating for purchases of land or right-of-way with White Pass? This is a crucial question. It is a crucial question because one has to then turn back to the Executive Council Code of Ethics, and I would draw Members' attention and the Speaker's attention once again to paragraph 5:

"Whenever a matter comes before a department for which he has responsibility" - in this case, Community and Transportation Services - "which involves a personal interest such that it might be construed as influencing the impartiality of his judgment, a Member shall bring the matter to the attention of the Executive Council and request that a colleague be appointed to act for the department concerned for the purpose of dealing with that matter."

This is important because, surely, we would have seen some other Member dealing as the Minister responsible for the Department of Community and Transportation Services with regard to waterfront development negotiations during preparation of negotiations with White Pass and entering into negotiations with White Pass. Otherwise, there is a very apparent breach.

That one is interesting, and I will be getting into it later, but the other Cabinet Minister named in the motion was elected to this Assembly in the February 1989 election. If one pursues his disclosure statements, one can see that he was concerned about the issue of conflict of interest with regard to something else - not this matter apparently, from reading the materials there - that was happening in Faro. With regard to his business dealings in Faro, that Cabinet Minister took steps. We will be getting back to that later.

What did he do? He declared it as a possible conflict of interest; he sought legal advice about it; he directed that his business interests be placed in a blind trust; he directed his deputy minister to totally withhold the file from him; he advised his Cabinet colleagues accordingly, and he ensured that no personal dealings or information takes place involving that Minister and the matter of Chateau Jomini, "The Department of Justice has been directed by Cabinet to handle any dealings involving Chateau Jomini." That was the appropriate course to follow with that particular transaction. The question here is this: why did this Minister not take similar steps?

Did Piers McDonald not think he was in breach of section 3 of the Code of Ethics, in that it could be perceived by the public that confidential information was being used in such a way as to derive a profit or an advantage to himself, his family, friends, or associates? Again, we are looking at the extraordinarily high standard that is imposed on a Minister by law - appearance, perception.

It is interesting - and I will be getting to this before we move on too far. I would like to draw Members' attention to a letter addressed to Mayor Don Branigan under Tab 8, dated November 7, 1990, with a copy to Maurice Byblow - who was then the Minister of the Department of Community and Transportation Services - signed by Thomas H. King, Chief Executive Officer of White Pass. I will draw out the one thing that is relevant at this point. At the top of page 2 they are discussing negotiations about the possible purchase of the railway. At the top of page 2, and I quote, "We talked about the rail right-of-way south of the crossing to Riverdale and agreed" - that is the railway right-of-way that goes right by the land we are talking about, Lot B - "we would discuss it at another time. It is a separate issue." We will be talking about that further, but it shows that there were discussions about it and, of course, an inquiry could get to the bottom of this much better than someone such as I.

Tab 7 deals with a letter from the Mayor of Whitehorse, acting Mayor of Whitehorse and Mr. Byblow to White Pass regarding waterfront lands. Of interest at this point in time is this sentence in the second paragraph, "As you are aware, our two levels of government had entered into a tripartite waterfront planning exercise with your company some two years ago now."

It was two years ago, and that puts us back in or about the tail end of 1988. It puts us back a long way toward the transactions that took place before the general election of 1989. It certainly helps substantiate the fact that the government had been discussing and preparing internally to negotiate and discuss the waterfront and the railway right-of-way. We know that it was looking at, among other things, expropriation.

Two years previously puts them into the mode of negotiations in 1988. It started out when this Member was still Minister responsible for Community and Transportation Services, and it started out at a time when 6660 Yukon Ltd. was still owned by his wife.

I do not know if there was an agreement as to the kind of enterprise one would place on such a potentially valuable piece of land, Block B. I have heard rumours about a hotel possibly going there. There is quite a broad potpourri of commercial possibilities. It would be interesting, through the auspices of a public inquiry, to find out if there was discussion about the future joint development of these lands in question by some or any of the parties who purchased Lots 4, 1, 5, 6, and 2, prior to the general election of 1986.

I am breaking this into two time frames - before and after the general election. It is important to focus on the seriousness of the appearances of the transactions that took place while Mr. McDonald was Minister. After the general election of 1989, he was no longer Minister. His former executive assistant successfully ran in the election and was appointed Minister of Community and Transportation Services in his stead. Mr. McDonald continued on as Minister of Education and some other departments.

The status of some of the players changed as a result of the election of February 1989. That is one of the reasons it is important to focus on the initial transactions and then look at what happened later, and how what happened later reinforces the appearance that the initial transactions give rise to.

What happened after the general election? As I said, Maurice Byblow was elected and was no longer on the political staff. Mr. McDonald then became a colleague in the Cabinet. Mr. Byblow, then, was in charge of the department that, as I have already mentioned, deals primarily with the communities and lands. Mr. Byblow also, as I understand it, after a period of time, became common-law partners with Janet Pauch. Piers McDonald remained in Cabinet, as I have said. That is in February 1989.

Then, for some reason, we see that Ofelia Andrade sells her 50-percent interest in 6660 Yukon Ltd. to Maurice Byblow. This gives rise to a lot of questions, such as why did she sell and how much did she get, was there a declaration of incomes from the property, and so on?

Then there is this interesting blind trust that is set up, according to the disclosure documents set up by the lawyer for Mr. Byblow, whereby Carson Bell of Faro replaces Maurice Byblow as president and director, among other things, of this company and other companies. That happened in November 1989, about nine months after the election - or eight months, if it was concluded in October. The record shows the actual transaction concluding in November. Maurice Byblow is then stating that he still retains retains 100-percent beneficial ownership of 6660 Yukon Ltd.

Again, I will talk a bit about this blind trust, but just to conclude some of the things that then happened, Bob Byblow replaces Carson Bell as trustee of this blind trust, and he becomes president in November 1990. Shortly after the election in October 1992, in February 1993, Maurice Byblow becomes president of 6660 Yukon Ltd. and owns 100 percent of the company that owns the two lots.

Let me get back to this blind trust, though, because when one looks at the documentation - and that is all we have to look at - it is very apparent, from a legal opinion contained in the file, that the concern Mr. Byblow had to deal with and the issues raised and dealt with in an opinion letter had to do with Chateau Jomini and dealings with one Mr. Stehelin. The advice given, as a result of his disclosure to the lawyers regarding, specifically, Chateau Jomini in Faro, was to take certain steps in order to avoid conflict, or the appearance of a conflict, and that he did. He did take these steps, somewhat belatedly. Many of these steps were taken fairly soon after the election. The blind trust, apparently, was not created until eight months later.

However, what is interesting about this is that there is nothing - at least, that we have now - that would indicate any concern, or even raising the issue of what was going on with Block B in the City of Whitehorse, and drawing that to the attention of the lawyers and receiving advice on that. You see, if there had been any kind of communication, surely the lawyers would have said, "Look, you have to take the same steps regarding the waterfront and negotiating with White Pass as you have taken with regard to Chateau Jomini. Otherwise, there is going to be a perceived conflict." Again, surely this is the logical conclusion at which one has to arrive.

Next, I want to talk a little bit about a company that was incorporated on December 19, 1990, nearly a year after the general election. The records show that the original parties involved were Darryl Weigand, Tim Koepke, Barry Stuart, Christy Knight and Bob Byblow. Mr. Stuart resigns from the company; Bob Byblow resigns after the general election of October 1992, and Maurice Byblow becomes a director on December 8, 1992.

It did not take him long.

In July 1992, we have a transaction occurring regarding one of the pieces of the puzzle that had not yet been purchased. I refer to Certificate of Title No. 92Y846, regarding Lot 3, Block B, Plan 19005 in Whitehorse. In this case, I will table the certificate of title I just described.

It shows that Sherwood Banks Inc. purchased Lot 3 on July 30, 1992. The price was $90,000. The financing was through the Canadian Imperial Bank of Commerce.

A period of time went by. In November 1993, Lot 2, which had gone through several purchases as described here, was purchased by Sherwood Banks Inc. I would like to table a certificate of title for Lot 2, Block B, Whitehorse, Yukon Territory Plan 19005, and a Certificate of Title No. 93Y1267. It shows that this was transferred to it from the Lyndax Development Corporation. The price was $137,028. The financing was through the Canadian Imperial Bank of Commerce.

We have Mr. Stuart involved at least initially in the company, but he stepped out prior to the land transactions that I referred to. We have Bob Byblow - the brother of Maurice Byblow - in the company right through the purchase of Lot 3, and then he resigned after the general election on November 25. Maurice Byblow became a director on December 8, 1992. This makes it appear as if something was going on. It again underlines the necessity to have an inquiry to look at and which is able to compel any of the agreements and evidence - if there were any agreements - between the various players.

With regard to Sherwood Banks Inc., we again have a concern under the code of ethics. We have an appearance of conflict and we certainly have to wonder about - I will be getting to this as well - paragraph 3, which states, "A Member shall not use information privy to the Executive Council in such a way as to derive a profit or advantage for himself, his families, friends or associates."

When Mr. Byblow took the steps to create the blind trust, again there is nothing to indicate that he was concerned about him being Minister and dealing with things that impacted on the value of Block B, and he did not put the holdings of Janet Pauch into a blind trust, which I think is an important issue under the definition of family, which means a Member's spouse and dependents who normally reside with him.

The blind trust, in many ways, was a weak way to approach the situation. I mean, did the Member suddenly not know who owned this land? Surely, the important steps would have been to get away from it and ensure that he, as Minister, was not taking this lead role in the development of the waterfront and the railway right-of-way.

I guess that to lay people, when someone says blind trust, it is supposed to mean something, but you really have to look at that creature, because that is not what is called for under the law - as some Members love to talk about the law.

The point is that this was not the mechanism for dealing with the kind of situation we have here. By itself, it does not really help. Mr. Byblow received legal advice about the perceived conflict in Faro. What did his law firm advise him to do? Take some real steps and create this blind trust in addition.

The real steps with the Faro deal were the steps he took and filed in his disclosure statement. He declares under section 5 of the Executive Council of Yukon Code of Ethics. He declares in the spirit of the Executive Council Code of Conduct regarding conflict of interest that his previous interest in a possible purchase involving Chateau Jomini from the government might now constitute a conflict of interest due to his capacity as Minister.

He advised the public and the Speaker's office that he sought legal advice and directed that all his business interests be placed in a blind trust, and that was occurring at the time. He directed his deputy minister to withhold that file from him totally. He advised his Cabinet colleagues accordingly. He ensured that no personal dealings or information would take place involving him in the matter of Chateau Jomini, and the responsibility was shifted to another department, that of Justice.

All those things taken together were appropriate steps. The blind trust by itself, in my respectful submission, would not have done it. Not at all. However, he did not take those steps with regard to the appearance of conflict between what he was doing as Minister and his beneficial ownership, as well as that of Janet Pauch, in land right next to the railway right-of-way.

It is interesting that he then commenced on a very aggressive bout of negotiations involving White Pass. This had been ongoing because we know this from the letter dated November 2, 1980, and contained in Tab 7 of the summary of evidence that I have tabled. We know that these negotiations commenced under the stewardship of the previous Minister of Community and Transportation Services because they commenced two years ago, according to this letter. That letter is signed, of course, by Maurice Byblow as well as the acting Mayor of Whitehorse, Mr. Thick. It is a fairly in-depth discussion of issues, I guess, that are not too pertinent to the point here, but it is important that we have some concept of continuity here, and it started back in 1989, according to this letter signed by Mr. Byblow, who was the executive assistant of the Minister of Community and Transportation Services two years previously.

Then there is a letter to Mayor Don Branigan, copied to Mr. Byblow, which shows that they were discussing the railway right-of-way south of the crossing to Riverdale and said that it is a separate issue.

I can only surmise what happened with the negotiations, but it is interesting to note that Mr. Byblow wanted to take a lead role in the discussions. That is acknowledged forthrightly by Mr. King, who promptly addresses his letter to the Hon. Maurice Byblow at the top, and then under his name, Mayor Branigan; whereas, before, he sent his letter addressed to Mayor Branigan, but only sent a copy to the Minister. These things, I gather, have some significance in bureaucratic circles.

So, he was aggressively pursuing it and taking the lead role in the negotiations, and, of course, eventually we were given an announcement that the railway right-of-way - part of it - was actually purchased in 1991. It was a very significant event.

What did that event - the purchase of part of the railway - really mean? Let us think about that for a bit. It certainly made it virtually impossible for the railway track to continue to be used as it had in the past, should the railroad ever get up and running again from Whitehorse to Skagway. It also confirmed in many people's minds that the rest of the railway, especially the part along the river, would probably be for sale. I guess it would be open to government or individuals to negotiate, if they so wished, for the purchase of the railway bed.

Surely the railway bed by then would have tremendous significance to those people who own property along the South Access Road.

Again, if one looks at Tab 2 at the map, the impact of adding that land to the property can be readily imagined.

Then there is the whole issue of straightening and improving the South Access Road, all the way out to Robert Service Park. There were discussions between officials, at least of Community and Transportation Services, and the city from time to time over the years about who would pay and what would be done, and the whole issue of whether or not the railway itself ought to be purchased or expropriated for the purpose of that road.

Once can imagine, and make a pretty good case I would think on behalf of the people of Whitehorse, that perhaps government should have acquired that land - or should acquire it, looking into the future - because of the tremendous growth potential of Whitehorse and the need for a wider, vastly improved access, and more particularly an intersection, at the confluence of the South Access Road, Second Avenue and the bridge into Riverdale.

I understand these are discussions that have been had from time to time internally within government, as well as with the city, a lead role again of the department in question and again the obvious problem being the impact on the general public of this land being assembled by people so close to the Minister.

Let us look at some of the issues that arose after the general election in the Yukon - the election that took place in February 1989.

Ofelia Andrade sold her interest and got out of 6660 Yukon Ltd., and Maurice Byblow picked up that interest - why was that decision taken? Did the Minister himself take part in that decision to sell the interest in 6660 Yukon Ltd. in the months following the February election, when Maurice Byblow became the Minister responsible for Community and Transportation Services? What was the selling price? Was it ever disclosed?

I see a typographical error under Tab 10, item 3. It should read "how much income", rather than "increase".

How much income was earned from leasing the properties owned by 6660 Yukon Ltd., while Ofelia Andrade was an owner of 6660 Yukon Ltd., and what was done with this income? Did this income accrue directly to the bank, to the mortgage - or whatever debt instruments were in place? Was the income, in some way, shared with owners of adjacent properties? Was the income enough to cover the debt payments? If not, was it incumbent upon 6660 Yukon Ltd., through its shareholders up to this point, to infuse more money into the company to pay the debt instrument?

Another way of putting it might be: was 6660 Ltd. operating at a loss when it was leasing out these properties? In my view, these are questions that should be properly put to the other purchasers as well, namely, the former Cabinet Minister, who is no longer in this place, the former administrative assistant and the other parties who purchased the land in the same time frame, 1987-88. Those parties were involved in another company - a new company - that Maurice Byblow suddenly had an interest in once he ceased being a member of the Executive Council or of these Chambers.

Again, all of these questions about these relationships, what the intentions were and what documentation was privately held by all or some of the parties are probably not compellable under the proposed conflict-of-interest guidelines. There is a big question in my mind, at least, about the Minister being able to compel evidence that may have no bearing on the perceived conflict of a private Member.

Another question that arises has to do with Lot 7. Lot 7 is the lot on which the grocery store is situated. There is no record that we could find from public documents showing that this property had been sold to any of the parties currently owning all of the other lots - Lots 1, 2, 3, 4, 5 and 6 in the block in question.

It would seem to me to be quite pertinent to the issues surrounding this matter whether or not any of those individuals or their agents approached the owner of Lot 7 about a possible purchase, or possibly that person joining some venture with others, or an option to purchase under certain circumstances. Again, these are the kinds of things that may involve documentation. They may not have happened, but it seems to me that the best way to find out would be through the establishment of a public inquiry.

The next question is this: in the event a public inquiry is established, will the Leader of the Official Opposition step down pending the outcome of the inquiry? It is my view that surely the appearance is pretty serious. Now, it may be that many of these questions will be answered fully by a public inquiry, and that is really why we should have a public inquiry to clear the air. Only if that type of full disclosure and full investigation is undertaken successfully - only under those circumstances - can we clear the air in this matter. This is not one person dreaming or one person jumping to conclusions based on nothing; this is the kind of evidence that is very upsetting to members of the public, and it deserves to be answered. It is the kind of evidence - of the nature and quality of evidence - that gives rise to the appearance that is contemplated in the Code of Ethics at Tab 1 of this book.

It states, "... no conflict appears to arise between" a Cabinet Minister's "private interests and public duties". He will not use or appear to use information privy to Cabinet "in such a way as to derive a profit or advantage for himself, his family, friends or associates." - then again, the full disclosure clause and an apparent conflict.

I ask this question, too, because in our parliamentary tradition, the Leader of the Official Opposition has privileges and responsibilities that are elevated beyond those of simple private Members. The Leader of the Official Opposition, in his role, is given recognition by such things as the fact that he is paid the same amount for fulfilling that role and for performing his responsibilities as Members of Cabinet are for fulfilling theirs.

I say this because the stature of the office is important and recognized in a very substantial way by parliaments throughout the British Commonwealth, and it seems to me that this question is an appropriate one to ask, not because of anything particularly personal or political here, but because we do have a duty, in the end result, to take steps to protect the dignity of the office and the trust that we expect of the public in a democracy.

Some Hon. Member: (Inaudible)

Mr. Phelps: It may seem humorous to the Member for Faro, but these are steps that, in my humble opinion, are necessary for the protection of the office, the protection of the dignity of this place, protection of the authority of this place, protection of the authority of the Speaker, and protection of the Mace.

These are issues that do deal with something far beyond Yukon and something far greater than the issues we have been discussing in this Assembly.

These are issues that speak to our support of democracy, our role as Members and the hopes of those who have defended democracy and the British parliamentary system in wars. I am sure that many of us have friends and family who went to war, who suffered and died or were maimed and crippled. It is to those people that we owe the responsibility to treat these kinds of apparent or perceived conflicts with tremendous care and seriousness, in a manner that shows us to be loyal to the principles we have been elected to uphold.

The next series of issues that are of great concern have to do with whether or not Piers McDonald, after the general election, while he was still a Cabinet Minister - and a powerful one at that - raised concerns with any of his colleagues or his leader about Maurice Byblow, as Minister of Community and Transportation Services, dealing with the proposed waterfront development and/or negotiating with White Pass on the possible purchase of the railway right-of-way.

Again, we have to look at the standard and at what is expected.

We know that Mr. McDonald's wife got out after the election, at some point in June. It is a serious situation where this Cabinet Minister knew of the interest that Mr. Byblow, 100-percent owner now of 6660 Yukon Ltd., and Janet Pauch had - as well as the others, but those two in particular. He knew that the department was carrying on with these negotiations, because we know the negotiations commenced under the stewardship of the previous Minister, Mr. McDonald.

Now think about it: a person in Cabinet knows that a colleague is acting in a manner that could be perceived to be in breach of the Code of Ethics and in a manner that could impact on land, which in total was assembled for a cost in excess of $500,000, knows that the Cabinet colleague had not declared a personal interest - he had a responsibility with regard to the negotiations for the waterfront and negotiations on the purchase of the railway right-of-way and had not disclosed it. Surely a Cabinet Member who had these concerns would raise the issue in Cabinet or at least raise it with the leader. Surely he would. It is inconceivable, in my respectful submission, that he would not.

I think that is a valid issue that has to be canvassed. Did the Cabinet Minister take any steps to raise the alarm and to ensure that there would not be an appearance of conflict? It is not enough to simply say one will not do something because there has been a blind trust created, not when Janet Pauch is still on the record as an owner, not when the Minister knows that two of the lots, at least, are 100 percent owned beneficially by the Minister, and when he knows all the steps that were taken because he was in the Cabinet.

The disclosure documents show that Mr. McDonald, as a Cabinet colleague of Mr. Byblow, was advised of the possible conflict of interest in the other matter, the matter in Faro concerning Chateau Jomini and for which Mr. Byblow sought legal counsel and followed it.

One has this Member knowing that his colleague had taken these steps on the Chateau Jomini issue. Would he not be concerned that the same steps be taken regarding the lots adjacent to the railway?

One must wonder if, being cognizant of the steps taken by Mr. Byblow regarding Chateau Jomini in Faro, and his legal advice - which is public record, because it is filed and available for anyone to read - that had any impact on Mr. McDonald, because the steps were taken to advise Cabinet and file the documents - took place on March 28, 1989. One wonders if that then had any influence on the sale by Piers McDonald's wife of her interest in 6660 Yukon Ltd.

Here are the steps that ought to be taken. Here is what the Code of Ethics says. Here is a colleague taking the appropriate steps for one thing - not the other, but for one thing. Does that not raise alarm bells? That is a question that should be canvassed by a public inquiry. It states, "... a

dvised my Cabinet colleagues accordingly, ensured that no personal dealings or information takes place involving me in the matter of Chateau Jomini. The Department of Justice has been directed by Cabinet to handle any dealings respecting Chateau Jomini." One can only speculate, in the absence of full evidence, such as can be compelled by a public inquiry under the act, whether this should set off alarm bells for the Minister whose department was actively negotiating these things while he was the Minister.

One has to believe - I would like to believe; I do believe - that if these facts were placed before the Government Leader of the day and the other colleagues, steps would have been taken very quickly, similar to the steps I have just spoken about. One has to believe that that would happen. One wants to believe that that would happen, again because we are talking about the way that parliament functions; we are talking about the trust placed in elected officials by the people; we are talking about the duties and responsibilities of the leader of a government; we are talking about the duties and responsibilities about a Cabinet Minister and about the duties and responsibilities of private Members.

So, did Mr. McDonald raise concerns at any time following the swearing in of Mr. Byblow as his successor and Minister responsible for lands and cities - namely, Community and Transportation Services?

Did Maurice Byblow bring the matter of his ownership of lots through 6660 Yukon Ltd. and the ownership of a lot by Janet Pauch to the attention of Executive Council - his Cabinet colleagues, that is - and request that a colleague be appointed to act for the department for the purpose of dealing with the purchase of parts of the railway right-of-way from White Pass and with all aspects of the proposed waterfront development? That is critical. It is critical because he knew what the steps ought to be. He had done it for something else. He had done it for Chateau Jomini. Did he take any of the steps? We cannot find where he did. I can only go to the disclosure documents and see what he did for Chateau Jomini. I see the blind trust. However, I do not know. A public inquiry could find out, I suppose, if - this is after the election - he took the steps. Did he advise his Cabinet colleagues about this apparent conflict? Did he ensure that no personal dealings or information would take place involving him, the waterfront and the White Pass negotiations, and have some other Minister take all of that over?

We cannot prove some of these things. We can only go by the record. We do have some interesting evidence though, because it was very apparent that he continued to not only play a key role in negotiations, but he insisted that he take the lead role in discussions with White Pass. He did not want to be second fiddle to the mayor.

Then we come to the issue about whether or not Mr. Byblow thought he was in the breach of the Code of Ethics at section 3, because of the perception that confidential information was being used in such a way as to derive a profit or advantage for himself, his family, friends or associates.

Surely, the appearance must have been obvious. Surely, when you form a numbered company to acquire some real estate and you have the other person in the political staff buy one in her name, and then have some acquaintances buy in their name - what does this give rise to in the minds of the public? Is that what happened? Can we close the circle? Does any one of these particular pieces of circumstantial evidence totally prove conflict? No, but we are not talking about conflict. I began my summation as carefully as I could, because it is so important that the elevated status and the higher obligation placed upon the Cabinet Member and his colleagues be considered very carefully by each and every person in this room, or at least in these Chambers.

Each person, as a Member, has to consider the evidence very carefully, not from the perspective of party, not from the perspective of political one-upmanship, but consider it in the light of the responsibility bestowed on a Cabinet Minister.

It does not matter in the long run whether or not some issues, some partisan politics, were raised or lowered by this motion and the actions to be taken on this motion, should it be successful, or the actions to be taken by Cabinet, which has the responsibility, in any event, for considering this evidence that I am placing before you and these arguments that I am placing before you. What matters is that we do the right thing, that we clear the air.

I had a lot of trouble with the issue. I became cognizant of some of the facts. Some rumours and so on were raised during a period of time when this place was being particularly ugly - conflict of interest was being bandied about by all kinds of people raising it in the House during Question Period and, in my view, involving matters that just do not even come on the same scale as what we are talking about here. I personally was quite alarmed, in a partisan way of course, at the way in which this House had become so ugly, so ugly in the way that the accusations were being made, and the way the stature of the House became diminished by accusations based on little or no fact.

It was a commonplace occurrence, and when I heard the rumours about an assembly of land by certain people, I looked up 6660 Yukon Ltd. and hurriedly assembled some information about what had the appearance of being an assembling of this land, through numbered companies, by political staff and Ministers of the Crown in the previous administration. In December 1994 - I do not think I have the exact date with me - I recall tabling that information. I did not have nearly the amount of information that I have now, but I certainly had a lot of it. I had facts to support the documents that I did file in the House during Question Period. I had done some homework.

I guess I am a fairly cautious individual when it comes to these things, being a lawyer, but what is interesting is that once the documents were tabled, the behaviour of this House suddenly changed. All of a sudden, Question Period was not full of allegations and so on that had been happening. That was the purpose of what I did back then.


ssembling the kind of information that I have been able to lay before Members today, thinking through what the transactions might mean, tracing land flips and deals, following leads and trying to find and interview people from one of the corporations involved - White Pass - and have them find documents or see if there was anything worth pursuing further, involved a tremendous amount of work.

I must say that I did not really want to end up in this position. I was concerned about what the documents that I had tabled back at that time might lead to. I honestly believed that it would be followed up by the media. I had conversations with at least one member of the media, who came to see me because that person was really interested in doing a story, but did not have time during the spring and then during the summer. Then she left the Yukon. Then another person came to see me and I said, "Fine, I will give you what I have, but these are just public-record documents and you will have to do it yourself.

I am certainly not here to hide anything."

But that never happened, so we did not have the media or the press following up on this story. I think it would have happened anywhere else. I was left wondering what I should do? I did not want to be accused of engaging in a witch-hunt. What does one do?

Assembling this information is a lot of work. I did not have time to do that as a Minister responsible for the two busiest, biggest and most complex departments in government. I honestly believed that the media would have pursued it.

Should I have gone to the RCMP with it? I do not know. This, to me, did not seem appropriate either, but, again, not because I did not think that there was a serious flavour or perception arising from what we have to date.

I think the point I want to make is that to really develop a strong case that meets at least the appearance of a conflict test, and which at least puts forward a strong prima facie case that must be rebutted, is a serious undertaking. It is a damned tough undertaking, and I finally, really working hard, pulled together what I could in the course of the last while in preparation for this motion.

I think that I can be faulted for not acting sooner, but I think it is important to explain - at least from my point of view - that I do not consider myself to be a detective or in the role of a police officer. I do not consider myself to be anything other than a Member of this House and a Member of Cabinet.

I have got to say that I am most disappointed that the media did not take this up. I am most disappointed that I am the one who had to follow up from time to time to gather enough evidence so that steps could or could not be taken to clear the air.

In December of 1994, something was tabled in the House and one might ask why something was not done right away. Well, budget time is a very busy time. I was Minister of the two biggest departments in government as well as the Member for Ross River-Southern Lakes - a very, very difficult riding at the best of times for an MLA. It is a riding that is spread out and it has a lot of grievances and issues involving individual constituents, as communities, as First Nations, as hunters, fishermen, you name it.

There is an issue about making something a priority to devote the kind of attention to it that was required to bring forward something that would be evidence of the nature that irrefutably presents the prima facie case requiring rebuttal of the appearance of conflict, or the appearance of breach of the Code of Ethics, and the appearance of conspiracy among more than one Member of this House.

These are not issues taken lightly. I want to impress upon Members that by developing the documents and developing the argument, I was trying to ensure that this was not just one of the slinging matches that go on in this House sometimes, and trying to ensure that there was a strong base built for the allegations as contained in the notice of motion. I am trying to base everything that we are saying in the Legislature on fact.

I admit that there may be answers to some of these things that show that there is not an actual conflict, but only an appearance of one. I admit that. I just do not know.

That is not what we are here for. We are not here to play politics or make wild accusations. I hope that if I have done anything in this submission, I have steered away from making that mistake. We are talking about perception, we are talking about appearance, and we are talking about the extraordinary duties of the two individuals named.

Without this abundance of factual evidence, I would not have come forward with this motion. Without in some way feeling that something would lead to the common good and to what is good for the dignity and reputation of the Legislature, I would not have brought this motion forward.

I understand; I have been around. I know that I will be accused of all kinds of heinous acts, but this issue is not about me; this issue is about facts in time, facts in place, the law, and whether or not there is an appearance of conflict.

Some Hon. Member: (Inaudible)

Mr. Phelps:

I hear the Member for Riverdale South - I am not sure if she wants to speak or if she feels that I am trivializing something. I certainly do not intend to speak until 5:30 p.m. When I have finished covering the bases, I intend to allow time for a response.

I think that is important. If the individual named wants to respond in any way he should be given time to do that, and I intend to give him that opportunity. I do not in any way want to leave myself open to the charge that somehow I am not going to allow that opportunity. I fully intend to, today, but I want to ensure that I have not missed any of the evidence that I think is so important here and any of the inferences that arise therefrom.

I spoke of the railway purchase, going back to the map at Tab 2. It is appropriate that I also mention the purchase of the Taylor Chevrolet lot by the government as part of the downtown scheme, but the main issue here has to do with insider knowledge that would necessarily lead to a conclusion that steps would be taken that would make the lots adjacent to the railway far more valuable than they were in 1987.

The issue has to do with the whole concept of whether or not there is the appearance of insider trading. On a scale such as this of $500,000 plus, the issue has to do with whether or not Ministers ought to be accountable to the public - not just this Legislature. The issue has to do with whether or not appropriate steps were taken to satisfy the code of conduct and the code of ethics. The issue has to do with whether or not the public deserves complete answers to the situation as laid out before the House. The issue has to do, in part, with deterrence in terms of ever allowing these kinds of appearances to arise again. The issue has to do with Members taking some responsibility for the reputation of this place and the dignity of office.

I said that I would not talk this out. I wanted to provide time for rebuttal, arguments, discussions or whatever might emanate from Members opposite as well as those on this side. I am concerned that there are aspects about which I may have forgotten, but I am sure I will be able to cover any such negligence on my part in my closing comments to this motion.

Accordingly, I will now take my seat and listen to the comments of other Members in this place.

Mr. McDonald: Where to begin. There is so much to respond to and so much innuendo that it would be impossible to do an adequate job this afternoon. I think the Minister probably had calculated that by speaking for two hours, leaving the response to a few minutes. That way, he could say that he had provided some time for a response.

I am perhaps saddened by the approach the Member has taken in his closing moments in legislative history. I am saddened by the method in which the Member has raised the innuendo, asked the questions and drawn conclusions. There is a lot to talk about this afternoon that is not only related to the matter at hand, but also relates to the whole question of how one deals with these kinds of issues. I will try and keep my remarks limited to a few things and respond at a later time to the details.

First of all, for the record, I want to say that integrity in public decision-making has always been a high priority for me and for an NDP government. I hope it will always be a high priority for anyone elected to a position in the Cabinet office. Never before, while in government, has anything that I have ever done been called into question. There have been no attempts such as this in my entire political life - or even in my entire life - to smear my reputation in a manner such as has been done this afternoon. This is a first for me.

Everything I have done has been on the public record. Everything I have transacted as a matter of public business has been available for public scrutiny. To suggest otherwise - at this stage, at this time - is, I think, not only wrong, but unethical.

The allegations the Member makes this afternoon are essentially not new at all, and I am sorry that he has defamed so many good residents of this town this afternoon. I am sorry that he has chosen to use his office, in his closing moments as a legislator, to use his rights in this Legislature to make slanderous accusations and unfounded innuendo about so many people whom I respect.

Unparliamentary language

Speaker: Order. I would appreciate it if the Member would refrain from using words such as "slanderous". "Slanderous" is definitely an unparliamentary word. I realize that the Member is not necessarily accusing a Member in the House as being slanderous, but the Member is using it as a slanderous allegation.

Mr. McDonald: I showed the respect of sitting through two hours of commentary that completely slandered my entire public life for the last 10 years, and you said nothing.

Speaker: The Member did not use the word "slanderous". The Chair has ruled that the word "slanderous" is unparliamentary, and I will rule it unparliamentary if the Member uses it again.

Mr. McDonald: Unfortunately, I have to abide by your ruling, and I will do that, because I have other things to say and more important matters to address than debating with you.

The allegations that the Member makes this afternoon are not new. They were completely unfounded when he made them in Question Period last year. Even in their detail, and even in the context of a package with lots of tabs in it, they are equally unfounded.

The fact that the Minister has presented items that he has referred to as items of evidence do not by themselves draw conclusions that he would draw when summing up.

Now, when the accusation that there was a conflict was originally made, the Minister claimed that the property on Hoge Street that was purchased, in part, by my spouse, was somehow benefiting from the fact that the Government of Yukon had purchased the Taylor Chev property as being a property on the waterfront.

Now, any commonsense person can walk out the door of this building and look at the two properties, can instantly identify that the properties are three blocks apart and that there is no immediate understanding that there be any connection whatsoever between those properties to give advantage to anyone who lived adjacent to, or who owned property behind, the Riverside Grocery Store.

When the Member was a Minister, he claimed during Question Period that this was all part of waterfront development and, consequently, because the Hoge Street properties were somewhat close to the water - meaning they were across from Rotary Park and across from the SS Klondike - somehow the waterfront development itself was going to benefit the properties on Hoge Street.

At a later time, the Minister of Tourism was asked a question about whether or not the development of the Taylor--Chev property was going to preempt waterfront development, and the response from the Minister of Tourism was, I felt, quite accurate. The Minister said that the Taylor Chev property was not waterfront property. He said that the waterfront property was across the street, beginning at Closeleigh Manor and running toward the Motorways yard on the riverfront. That was the definition of waterfront property.

When the Member for Ross River-Southern Lakes tried that gambit - suggesting that there was a conflict and was unable to carry it off - I am sure he was disappointed. Presumably, he kept in the back of his mind the need to get some sort of revenge and he kept thinking about what he might do to seek that revenge.

He got his opportunity for revenge and he did indicate that he was preoccupied with other matters of state when he was a Minister and he could not actually get around to pursuing this matter until he left office a couple of weeks ago. When he did leave office, he did mention to the media that he was now free to raise issues such as this and he said in a newspaper that he was now free of the constraints of party discipline. He threatened the Opposition with mischief. This afternoon is presumably installment number one.

I was thinking to myself what the Minister was going to do to describe the purchase that I had made of my home on Redwood Street in Porter Creek, how he was going to characterize that particular transaction and what kind of brief I was going to get with tabs and colour photographs of the house on Redwood Street. He could come into this House and he could say, "One Piers McDonald, Member of the Legislature, made a purchase of a home, one ot such-and-such on Redwood Street in block such-and-such in Whitehorse." He might go on to ask the question, "Why did Piers McDonald not meet with the vendor of this property?"

There are many questions one could ask. This is a question not yet answered: did Piers McDonald use an agent to purchase this property? An agent who - using innuendo - was somehow a cloak-and-dagger fellow.

Why did Piers McDonald use the Royal Bank to purchase his property, and did this use of the Royal Bank, in the end, mean in reality that he had a vendetta against the TD Bank that got the government contract, and that is consequently why one asks questions in the Legislature?

Did Piers McDonald, the Minister of Education, knowing full well that Christ the King Elementary School was getting a little crowded, tell the people who were selling the property on Redwood Street that there was a school reserve on the corner of Wann Road and Bamboo Crescent, just down the street? Did he tell them that if a Catholic school - which was eventually built, I should point out - was built in the neighbourhood, it would increase the value of the property he was purchasing. Would a reasonable person not think that this information should be communicated to the vendor? Did he tell the purchaser that he was intending to upgrade this property and thereby increase its value, and why did he purchase this property at a market value greater than the vendor purchased it himself?

Is it not true that Mr. McDonald purchased this property for $133,000, and is it not true that the property value skyrocketed afterwards and it was assessed, according to a private assessor, at $195,000?

I am anticipating the next round of debate here, Mr. Speaker.

Did Mr. McDonald tell the vendor of the property on Redwood Street that he had signed off a community plan only two or three years earlier that designated some green space near his home, and did he tell anyone that he had heard from a city councillor that some day there might be a request for a change in that community plan to develop property down below, thereby presumably increasing or decreasing, or whatever, the property value of that home?

Let me say this: every question that Member has put in this book I can answer and I will answer. Every question, with its innuendo and unfounded allegation, I can answer.

When he asked why my spouse bought a piece of property at a value higher than the purchaser previously purchased the property for, I can give the answer. The property value went up. Obviously, there would have been every attempt made to keep the purchase price down to the lowest price possible, but purchase prices went up.

Three or four times this afternoon, he asked the question of why my spouse sold the property. He asked why she sold the property to Mr. Byblow. What was the reason for that? He said that this is a question that only a public inquiry can answer.

She sold the property in order to buy into a business. She purchased her share of the property at $24,000. She sold it at $35,000. There does not need to be a public inquiry to tell people that. I can tell them right now. I can answer any of these questions at any time. I can answer them fully and honestly.

This Member seems to think that everything was done behind the scenes, that there was no attempt to ensure that the public light was let in, and that this was all somehow done privately and secretly. He names some people who were colleagues, friends and others who purchased properties, and he suggests that they were all rolled into this evil scheme.

I know of at least one case in which the Yukon Party - the Leader of the Official Opposition - undertook the transaction of a purchased property on that site as a real estate agent. Either the people involved in this evil scheme were completely incompetent by allowing the Leader of the Official Opposition to actually undertake the transaction, or there were never any problems, concerns or conflict. I would submit that the reason is the latter.

When this Member decided he could not make any political mileage from suggesting that the purchase of the Taylor Chev property was in conflict with the purchase of two houses on Hoge Street, he decided he would pursue this matter using the White Pass right-of-way. He introduced what he regards as evidence, but purposely suggests there is a lot more information out there - he does not know what it is - that can only be gleaned from a public inquiry, that there are confidential documents. Incidentally, a document in here is listed as "confidential". It sort of puts into perspective the government's position on confidential documents.

Nevertheless, I am not afraid of making any of those documents public. Make them all public; make the works public; make everything public. The Member can have my mortgage if he wants.

He goes on to say that the White Pass easement is somehow now the linchpin in this scheme, as he has redesigned it. He is looking for a scheme that works - not a real concern, but a scheme that works and suggests there is a conflict. He has been a busy man in the last couple of weeks, as he sits in his own private hell, trying to work out how he can make my life miserable.

Unparliamentary language

Speaker: Order. Again I would remind the Member to try to refrain from making those personal attacks, like "your own private hell".

Mr. McDonald: What?

Speaker: That is the way I understood it.

Mr. McDonald: I am not going to rise to the bait.

Over the last 10 years, there were three opportunities for the government to have dealings with White Pass with respect to easement. I will describe them briefly for all Members present.

Upon the closure of the White Pass railway, White Pass made an offer to the Yukon government to either lease or purchase their railway - rail bed right-of-way, Whitehorse through to Skagway, docks - with everything included. The offer to purchase was somewhere in the $50 million range. No government, from the PC government to the NDP government - and presumably the Yukon Party government - has ever been interested.

The offer to lease was to suggest that the Yukon government could lease the rail bed for $3 million a year. From a public policy perspective, this was equally unacceptable. Nothing was ever done, to my knowledge, about the purchase or lease of that railway. The second opportunity for the government to talk about the rail bed and right-of-way was over the issue of the rebuilding of the South Access Road. The suggestion to purchase the right-of-way was not made by the Yukon government. It was made by the City of Whitehorse. It is the city's road - it owns the road between Second Avenue and the hydro station. It was the city's requirement to rebuild this road.

The city felt it could do one of two things: it could dig into the clay bluffs, which are on the rail bed and on the right-of-way, or it could fill in the river, at greater cost. Clearly, the City of Whitehorse would prefer the former option. It made the suggestion that the right-of-way be purchased for the purposes of rebuilding the South Access Road. During this period, the South Access Road was not rebuilt by the Yukon government, under NDP management, during the period mentioned by the Member.

It was the right-of-way purchase. But there was an understanding that it would be worthwhile to purchase the right-of-way in order to accommodate South Access Road reconstruction, which, presumably, is part of many people's public agenda. That was rejected, by the way, because White Pass did not want to sell the property. At that time, at least, White Pass wanted to either sell the whole thing or nothing.

The third opportunity to express a desire to purchase an easement did come from the Yukon government - respecting waterfront lands. Now, the Member is very selective when it comes to defining what waterfront lands are or are not. I noticed that he was very, very careful to allow people to believe that when he is talking about waterfront lands that are over there - I am pointing to my right, toward the Motorways yard - he has left people thinking about the lands adjacent to the properties on Hoge Street, and nothing could be further from the truth.

The right-of-way that the Yukon government wanted to purchase was the land across from Closeleigh Manor, down to the Motorways yard. That was the land in question, and that went through an analysis by the city, White Pass and YTG. It was not a right-of-way in the middle of Rotary Park, it was not a right-of-way beside Hoge Street, it was not a right-of-way under the bluffs, and it was not a right-of-way at Utah, or anywhere else. It was a very specific area - riverfront lands from Closeleigh Manor to the Motorways yard.

Those transactions were made, in the public interest, in public. They had absolutely no bearing whatsoever on any property held on Hoge Street or that area.

Now this Member goes on to make all kinds of allegations and suggestions, asking a long string of open questions such as whether or not we used a real estate agent to purchase property, or why we bought a property for an amount greater than the property value. The Member asked these questions over and over again.

The Member makes the suggestion that because I was the Minister who signed bylaw 86-50, the official community plan that allowed for what he refers to here as mixed service commercial medium density on this site, the commercial zoning of this property actually changed. The Member leaves the impression that it did. Does the Member mention the fact that if one lives anywhere within the City of Whitehorse, or if one owns any property at all within the City of Whitehorse, that one will be impacted by the community plan? The Member does not leave that impression. He leaves the impression that, because I was the Minister and because I had property in Whitehorse, I was giving myself personal benefit. That is what the Member wants to suggest.

If I were the Minister of Health and I signed off an order eliminating medicare premiums, I would benefit. If any Minister does anything that involves the laws of general application, they would benefit. In this particular case what would have made it seemingly wrong, or worthy of discussion this afternoon, would have been if I, as Minister, had tried to amend the official community plan, or had had any discussions with officials of the City of Whitehorse or anybody who had any authority with the community plan, to try and raise the value of the property through a change in zoning. No such conversations were ever made or held. Zoning was not affected.

The city went through its own process for establishing an official community plan. I, as Minister, did not interfere once or raise a single issue. I simply signed the product of the city's endeavours, as requested.

One can see under Tab 3, on page 2, the whole suggestion, the whole inference that there is something very, very wrong out there.

He asked this question: "Why use a numbered company to buy a house along with another person?" What is sinister about two people coming together, who are not spouses, and forming a company to buy property? What is sinister about that? Why did Mr. McDonald not declare income from these revenue properties, because, after all, they are revenue properties? The reason is because he did not make any income.

It is the same allegation Members made when they said, "Why did Mr. McDonald not declare any income from his mini-golf operation?" Because he did not make any income. He does not make even a wage.

There are a whole series of questions here that are put in an open-ended way, in hushed tones, legalistic language, all suggesting there is something truly, truly wrong. All the questions are straightforward. The innuendo is not. The innuendo is very pointed, one-sided, lopsided, all with one conclusion in mind: that there is something seriously wrong and that Mr. McDonald is dishonest.

Everyone associated with Mr. McDonald, from spouse onward, is dishonest. All those people the Member mentioned by name and broadcast through the public broadcast system all over the streets of Whitehorse, each one of those people knows exactly what this Member is talking about. Everyone listening to the Member this afternoon knows precisely what this Member is doing, and what he had in mind for them in dealing with their own reputations. He knew precisely what he was doing. Even if the Member tries to couch everything in the form of open-ended questions, there is still a result and conclusion.

This Member was trying to damage the reputation of a lot of people this afternoon, and he was doing it in style.

At the end of his remarks, the Member said he did not want this to be turned into a mud-slinging match with me or anyone else on this side of the House going after any number of Ministers, or Members, or anyone else. He will get his wish.

He claims that because Question Period toned down considerably since he tabled the information in December, somehow his bullying tactics and tactics of intimidation were going to change the way we were going to conduct ourselves.

What he did in December 1994 changed nothing, except for one important thing. It changed the government's whole attitude toward conflict-of-interest legislation. When the bill came forward, the Yukon Party government was more than willing to ensure that there was all-party agreement in this Legislature to pass legislation that all Members could feel ethically comfortable with. As painful as questions have been in the past, it has resulted, in my opinion, in a very good bill when it comes to conflict of interest. It is a bill that I intend to not only follow, of course, but it is also a bill that sets up a Conflicts Commission that allows for investigations, even investigations into the kind of base innuendo that the Member puts forward today in the guise of a legal draft.

The moment the Conflicts Commission is formed, I intend to put forward all my personal arrangements, including the purchase of the house on Redwood Street in Porter Creek. I will put it before the Conflicts Commission so they can feel comfortable, I can feel comfortable and the public can feel comfortable that I have not only acted with integrity throughout my public life, but continue to do so.

I would ask all Members - anyone who has been associated with a Cabinet position - to put all their personal dealings before the Conflicts Commission as well, so that we can all be certain that the public feels comfortable with their actions. I think that is fair and right, given the tenor of the discussion this afternoon and given the actions that have been taken until now.

To government Members - who I am certain were listening attentively before and less than attentively to my reply - I would ask that they consider the matter carefully before voting for a base measure such as this and buying into the political agenda of someone who, quite sadly, will be leaving a legacy that even he cannot be proud of.

This Member has had a good record on many fronts in the past, and in dealing with many different issues. The Member for Ross River-Southern Lakes has had a good record as a Minister in dealing with matters of public policy. This Member has been an effective Opposition Member on many occasions. Unfortunately, the stunt he pulled this afternoon is going to colour his memory for all time, and that is tragic.

It is important, in my view, to leave the debate about these matters to rules that we have set down for ourselves, through the law, legislation and conflict of interest. It is important that we not be seen to go witch-hunting on any angle, particularly through open-ended questions, innuendo and slanderous suggestions -

Unparliamentary language

Speaker: Order. I think I mentioned that I was going to rule that unparliamentary.

Mr. McDonald: I will still abide by your ruling, Mr. Speaker. I will still disagree with it but I will abide by it.

It is important that this Legislature send a message to everyone in the public who cares about the integrity of this institution that we will abide by the rules and follow established processes. We will not buy in to base attempts at revenge by one Member who is slinking out of sight in humiliation. We are going to do things in an organized, thoughtful way. We are going to ensure that people who seek office know what our standards are and know what rigorous scrutiny our own personal affairs will be put through before a body established by the Legislature. Everybody will feel comfortable with the rules. Everybody will know the rules and everybody will feel comfortable with the results.

I would urge all Members to vote against this motion, to not buy into this political agenda, and I would urge everyone to acknowledge that from time to time there will be instances when people will feel concerned about conflicts of interest between a Minister's public duty and a Member's private interest.

We will ensure that we follow the rules that we have identified - and that we have come through some pain to achieve, I might add - are appropriate and are right.

I would ask Members to consider what has been said this afternoon and I will indicate for the record, on my own behalf, that if anyone wants to put any of these questions that are listed in this submission to me, I will answer them all fully and fairly and will give information to them.

With respect to the Conflicts Commission, I will raise this matter with it, provide all information to it and I will be inviting, as I do now, all Members, particularly all Cabinet Members, to bring forward all their dealings to ensure that they are considered beyond reproach as well so that everyone can feel comfortable with the Legislature and with the Members who sit as Members.

Mr. Cable: For the record, it appears that this matter may come forward to a vote. I declare that while I have no pecuniary interest in the matter before this House, I would have a conflict if I spoke to the issue in a substantive sense or voted on it. Therefore, I will not be speaking to or voting on the motion.

Speaker: If the Member for Ross River-Southern Lakes now speaks, he will close debate. Does any other Member wish to be heard?

Hon. Mr. Phelps: I stand here now because there are rebuttal issues raised by -

Speaker: Order please. The time being 5:30 p.m., this House will now recess until 7:30 p.m.

Debate on Motion No. 104 accordingly adjourned


Speaker: I will now call the House to order.

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 Government House Leader that the Speaker do now leave the Chair and that the House resolve into Committee of the Whole.

Motion agreed to

Speaker leaves the Chair


Chair: I will now call Committee of the Whole to order. We will be dealing with Bill No. 11, Interim Supply Appropriation Act, 1996-97. Is there any general debate?

Bill No. 11 - Interim Supply and Appropriation Act, 1996-97 - continued

Hon. Mr. Ostashek: When we completed second reading, the Members opposite had a few questions that I would like to answer for them now.

I believe the Official Opposition asked if we would have sufficient cashflow to make the payments and I said that I believe the government did, and I was correct in my answer. Originally, the government thought that it might have a shortage because the federal government was talking about scaling back our upfront payment, but in the last several days we have received the proposed draw-down schedule from the federal government and it is pretty much the same as in the past. Therefore, the government will not go into debt in April and we will have sufficient funds on hand to cover our compensating balance requirements.

Both the Leader of the Official Opposition and the Member for Riverside were questioning the higher request this year, up to about one-third rather than the one-quarter in previous years.

The Member for Riverdale South was concerned about the amount of some $19 million being requested in Health and Social Services for capital. The proportion is higher but it is not due to any change in policy. The reason is that the departments are being more careful in estimating commitments that they will be making in April for the entire year. The spending for the month is likely not any more than in the past. The same is probably true for commitments.

However, since departments need an appropriation if they are to commit money, they are being cautious by ensuring they have appropriated every conceivable commitment. A good example of this is the one mentioned in second reading by the Member for Riverdale South for the hospital. The department is requesting the interim supply for the entire amount of the hospital construction in the 1996-97 fiscal year - $17.7 million - even though only a portion of that will be spent in the month of April. Since the contract for this project was signed long ago, it is probably a moot point whether or not a commitment authority is required for April at all, beyond the actual money that will be spent in the month. However, to be on the safe side, the department is also requesting commitment authority.

The Leader of the Official Opposition had some questions about the upfront grant policy. I believe that we have gone over it before, but for the record I will do it one more time. For the most part in the past, the government made payments to non-governmental organizations on an upfront basis. This practice continues in many instances, but as our cash position gets tighter due to federal cutbacks, we will probably have to start making more such grants on a periodic basis through the year. To permit such periodic payments, Management Board has authorized departments to do so where appropriate. At the same time, the board and Cabinet did confirm that grants to large organizations could continue to be made at the beginning of the fiscal year, as could payments to non-governmental organizations receiving less than $20,000 per annum in grants. The reason for this is that the interest was likely to be more significant for the larger non-governmental organizations, and the amount of paperwork involved in making a number of smaller periodic payments for grants under $20,000 would be prohibitive and difficult to administer.

I believe that answers the questions asked at second reading.

Mr. McDonald: The first question I have is a question the Minister probably cannot answer readily, and that is the question of capital works. Are departments under the instruction that they should proceed with capital works identified in the capital budget that are to be undertaken in the new fiscal year? Is there any instruction given that they should go to tender as soon as possible or whenever is appropriate, and that the budgeting process itself in this Legislature is not to be considered a restriction to that activity?

Hon. Mr. Ostashek: Yes, the Member is correct. The tenders do go out and are marked "Subject to budget approval". This interim supply will allow them the money to go ahead with the projects that are slated to start in the 1996-97 fiscal year.

We did have some difficulty convincing departments of that one year ago, but this year, I believe, everything has gone smoothly. Once the budget was tabled on February 15, tenders were ready to go out at that time for the jobs that were to start.

Mr. McDonald: The Minister has indicated that there is a sufficient cashflow in the coming month to be able to handle the full interim supply bill, which is, I guess, $150 million, and that there will be sufficient funds available to support those expenditures.

The Minister indicated that the funds provided to non-government organizations would proceed on schedule, and that there would not be a need - at least, in the current year - to provide for interim payments for cashflow reasons. Insufficient cashflow is obviously not a concern this year. Is it the case, where there is no agreement that parcels the funds out on an intermittent basis throughout the year, that the payments will be provided to the non-government organizations - the college, hospital, and others - up front?

Hon. Mr. Ostashek: Yes, I believe the Member is correct - where there is no other agreement, it will be paid up front.

Mr. McDonald: The Minister indicated that departments are being more careful in ensuring that they have the full amount for the payment in the interim supply bill, in order that they can provide for all of the funds they need for a full year. What is the reason for the departments being more careful? Has the Department of Finance directed them to identify all of the funds immediately?

Hon. Mr. Ostashek: I found in dealing with the departments over the last several years that they do not like to go to tender for a project unless they have the funds fully committed for the entire project. If, for example, we were starting a $3 million project that they wanted to start on April 1, they would request the $3 million in this interim supply so that they would be covered for the contract. They would not just request the money that they thought they would expend for the month of April.

I do not know how the Members opposite feel about that, but it is a moot point as far as I am concerned because this is an interim supply. I suppose we could ask them to go through the calculations and try to refine it a little closer if the Members opposite want to see a smaller interim supply, but I have not given them instructions, so I guess they have gone with what they feel they need to fully comply with the Financial Administration Act, and that is to have the funds approved before they go to tender.

Mr. McDonald: I, for one, do not have strong feelings on the subject. Obviously, if there is an amendment to the budget that the government disagrees with then it is a vote of confidence and then our whole world changes. That is true of the main estimates as it is true for the interim supply. I do not really have strong feelings about that. I just want to understand the policy more clearly.

Essentially, the two-thirds of the budget that would remain for the period from May 1 through to March 31, 1997, is for expenditures such as personnel, et cetera, that departments expect to expend during those actual months. Is that right?

Hon. Mr. Ostashek: I would say that is partly right. It also includes capital projects that departments did not intend to start in the month of April. They would not be included in this interim supply. I believe what is included are projects that departments intend to begin during the month of April.

Chair: Is there any further general debate on Bill No. 11?

Mrs. Firth: I have some comments about the Hospital Corporation annual reports that were tabled. From the reports, it appears that all of the funds received from the Yukon Territorial Government are used to cover the operation and maintenance type of health programs. They do not appear to have any financial involvement in the hospital construction, although I glean from reviewing the annual report that they appear to have taken ownership of the new building. I wonder if the Minister could explain to me the relationship between the hospital being built and the Hospital Corporation. Are they in any way involved in the financial responsibility of the hospital construction for the $17 million?

Hon. Mr. Ostashek: I do not believe they are, but that question may be better put to the Minister of Health and Social Services when we come to his department, and the information could be provided for the Member. I do not believe the corporation is involved in that at all.

Mrs. Firth: Is the responsibility for the hospital going to be transferred to the corporation after the hospital is constructed?

Hon. Mr. Ostashek: I would say that that is my understanding, but that can be clarified for the Member when we come to the health budget.

Chair: Is there any further general debate?

On Schedule A

Schedule A agreed to

On Schedule B

Schedule B agreed to

On Clause 1

Clause 1 agreed to

On Clause 2

Clause 2 agreed to

On Title

Title agreed to

Hon. Mr. Ostashek: Mr. Chair, I move that you report Bill No. 11, entitled Interim Supply Appropriation Act, 1996-97, out of Committee without amendment.

Motion agreed to

Bill No. 10 - First Appropriation Act, 1996-97 - continued

Department of Economic Development - continued

On Capital Expenditures - continued

On Industry, Trade and Investment - continued

On Loan Guarantee Reserve - continued

Hon. Mr. Fisher: I thought I would once more just run over what the $658,000 entails. This line item is based on the existing loan guarantees that have been provided under the business assistance loans and loan guarantee regulations. It is actually a loan guarantee reserve and is made up of two components.

First, it provides for existing loan guarantees that may be called. When loan guarantees are called, a direct loan is made and budget funds must be in place to make it. Previously, any loans issued as a result of a loan guarantee being called were made from existing loan appropriation funds within the business development fund, but the business development fund has since been discontinued. Therefore, this new appropriation has been developed to cover the contingency of called-loan guarantees. An estimated $500,000 has been budgeted to cover the contingency of any outstanding business development fund loan guarantee. This is equal to the largest single outstanding loan guarantee.

That represents $500,000 of the $658,000.

Then the $158,000 is to provide for possible losses on loans issued as a result of the previously mentioned loan guarantees called.

To explain it further, budgeting for loans is somewhat of an artificial process. In the accounting sense, loans are not expenditures but are assets, which are balance sheet accounts. Any money loan simply becomes a change in assets from cash to loans receivable. Since loans are therefore not expenditures, when they are budgeted, an offsetting recovery at 100 percent is also budgeted in the same year, so that the net expenditure is zero. In actual fact, the repayment or recovery of loans will take place in future years. However, the allowance for bad debts from the above loans issued as a result of business development fund loan guarantees called is not artificial and is not zeroed out, but rather, it represents a real expenditure.

Chair: Is there any further debate on this line item?

Mr. McDonald: Yes, there are a whole series of questions that the Minister did not address, which I was hoping he would either respond to or promise to respond to at some future time so that we could come back to this line item.

Is the Minister prepared to answer the other questions, or does he want to hold the line item over? We were talking about venture loan financing and what was going to happen with that particular program. Is the Minister prepared to answer those questions now?

Hon. Mr. Fisher: We can talk about venture loan guarantees in this line if the Member wishes. However, it has nothing to do with this $658,000.

Mr. McDonald: The Minister indicated to us that this was going to be the line item that would cover the program. The program is expected to go forward within a week or so, or whenever the it clears Cabinet, which, yesterday, was 10 days from then. We are obviously interested in the terms of that program and how it is going to be structured. Yesterday, we had a whole series of questions about the program. What is the Minister saying? Is he saying that there will be an opportunity to debate the program at some point, or what?

Hon. Mr. Fisher: As I said, the $658,000 has nothing to do whatsoever with the venture loan program, which is not even in effect yet.

Some Hon. Member: (Inaudible)

Hon. Mr. Fisher: It will perhaps be an allowance for bad debts. In future budgets, there will be a line for bad debts that come as a result of the loan guarantee. Due to the fact that the program is not in place and that there should not be any bad debts on it, even if it was in place now, none of the lines in the budget cover venture loan guarantees.

Mrs. Firth: This is the concern I have: there seems to be two different stories coming from the two different Ministers. The Minister has told us that this might become the venture loan program. I understand that might happen some time after the session. What this Minister is saying, therefore, is that -

Some Hon. Member: (Inaudible)

Mrs. Firth: No, he did not clear it up. He said it might become the venture loan program. If this government launches into its venture loan program, it will have to make another identification of money to cover possible guarantees that are called in.

Let us say that it lends $20 million. Is it going to use the same 10-percent figure on the loan venture program? It would then have to identify 10 percent of that $20 million and put it into the loan guarantee reserve - or venture loan program - to cover the possibility of those debts being called in.

The Government Leader said yesterday that there would not be an expenditure line identified in the budget for the venture loan program. There would just be an expenditure of the loans that were called in, after they were called in.

Surely, both Ministers must appreciate the contradiction there. The greater concern, and the most important fact, is that Opposition Members and the general public are given no information about the limits the government is going to set on the venture loan program and the percentage the loan/loss ratio is going to be. We have no idea what the potential impact this program could have on the budget. As a Member, I am very reluctant to just accept the two different stories I am getting and say, "Okay, let us pass it." I need some more information so that I can feel that I am at least making a semi-informed decision about what the government is planning to do. Right now I do not have any information, and I cannot make a decision.

Hon. Mr. Ostashek: I do not think we are saying two different things. There was some confusion the other day before the break, and I thought I had cleared it up after the break.

The venture loan program will be set out in regulations, as will the limit for the program and the amount for each loan. All of those things will be set out in regulations. What will appear in the next budget is a line item for potential losses. We do not have the whole program worked out, and the program is not addressed in this budget at all. In future budgets, there will be a line item for potential loan losses. The maximum amount of the program and the maximum per loan, and so on, will be set out in regulations under the act.

Mr. McDonald: I understand what the Minister is saying; however, I do not think the Minister understands that some Members of the Legislature want to limit the potential liability that the government might incur as a result of the total number of its loan guarantees. Certainly, it is the case that these things can be set out in regulations under the Economic Development Act. However, as we all discussed yesterday, for the business development fund the government has to abide by a certain limit. So, if the business development fund sounds like it wants to loan a total of $4 million, the executive of the government knows that it can loan any number of loans but cannot exceed a total of $4 million. Now, the Minister is indicating that that limit will be established in regulations.

However, what some Members on this side of the House are suggesting, and saying quite strongly, is that that limit ought to be debated in the Legislature. Unless there are some proposals that are completely out of the question, we are not saying that the Legislature should be deciding precisely how much of a loan should be given out as a maximum in individual cases, or what the situation should be in individual businesses that the loan guarantee is provided for. The Legislature does want to talk about the total exposure, the total limit. For example, if the government decides that through regulation it is going to provide a total loan guarantee limit of $3 million, presumably that would be acceptable to most people in the Legislature. But if the government says it wants to have a total loan limit in any given year of $50 million, then obviously there may be some debate about that, and we want to have an opportunity to debate it.

What mechanism is the government suggesting that it have in place, given that the program is going to start up next month, to allow, if it agrees with this, for the Legislature to pass comment on the limit of the total liability that the government can incur as a result of this program?

Hon. Mr. Ostashek: I appreciate where the Member is coming from. The Legislature ought to have an opportunity to debate the program. I would make this suggestion and this offer to the Members opposite, if it is acceptable to them. This program, I understand, is supposed to be coming to Cabinet one week from this Friday. I would be willing to bring forward a government motion setting out the parameters of what will be established in regulation to give the Legislature a chance to debate the limits that we are going to set, the limits per loan and all of the parameters of the program that will be set out in regulation.

Mrs. Firth: My preference would be to see the regulations themselves. If that is possible, we would have an opportunity to review them. It is not anything that has never happened before. There have been other governments that have tabled regulations at the same time that they tabled legislation in the House, and we have had an opportunity not only to debate the legislation, but the regulations as well. I think it would be more helpful to Members of the House if we could have the actual regulations, and in order for Cabinet to approve the program, I think it is going to have to have the regulations established as well, is that not correct?

Hon. Mr. Ostashek: As I said, this is a new program that is still in the final stages of being put together, so I am not sure that we will have the regulations ready. What will be coming to Cabinet for approval is the agreement in principle to establish the parameters. For example, say that there is $2 million maximum for the program, a $100,000 maximum for a loan, and these sort of things - that is what Cabinet will be giving approval to now. I am not certain that the regulations are ready now. If they are ready, I have no difficulty bringing them forward to be debated in this House.

We still have to go to the banks one more time after we receive approval in principle from Cabinet for this program.

Mrs. Firth: Are the banks going to see the regulations before agreeing to participate in the program? I see the Government Leader shaking his head, "no." What information are the banks going to have? How are they going to know whether or not they want to participate in the program?

Hon. Mr. Ostashek: We have already had three meetings with the banks and they are pretty well in agreement about what they are prepared to agree to. This will be set out in a contract with the banks.

Mrs. Firth: I would like to see the regulations, but if that is going to be absolutely impossible then I guess we will have to go with what we can get, which will be the parameters that are established. I do not see it being a huge, onerous production with 50 pages of regulations. I think that it should be fairly straightforward. There should be some basic principles and some basic regulations established. Perhaps the Government Leader could at least give some indication of when we might have this information. It would be my preference to stand the item aside until we do receive the information so that we can debate it, since we do not have any other line item in the budget to discuss it under.

Hon. Mr. Ostashek: It is not in this budget, so there is no line item to stand aside. We have debated the line item that is here. I said that I would bring forward a government motion and if we have draft regulations available, I would be happy to bring them forward. There is nothing in this budget that deals with the venture loan capital program, so it is not necessary to stand any line aside.

Mr. McDonald: Could I suggest that the Minister, rather than bringing forward a motion, permit the discussion, and table the information he wishes to table? I am certain it will be sufficient for us to get a sense of where the government is going. He could table the information during whatever appropriate department is underway, be it Finance or Tourism or other business-related department. The two Ministers agree that we simply have a brief discussion about the parameters of the program. It would be better to have the give and take rather than people making speeches at each other. Would that be acceptable?

Hon. Mr. Ostashek: Yes, that is acceptable.

Loan Guarantee Reserve in the amount of $658,000 agreed to

On Allowance for Bad Debts

Hon. Mr. Fisher: The allowance for bad debts is to provide vote authority to set up an allowance for bad debts. Funds will have to be found from within the budget, if required. As mentioned previously, when loans are first issued, an allowance for doubtful loans should be established as a certain percentage of loans that will not be repaid. Theoretically, the allowance established each year, as loans are issued, should be sufficient to cover loans that will not be recovered. Therefore, no new appropriation is required if the last allowance is sufficient and there are no new loans being issued. However, there may be changes in some loan situations and the vote authority is required to make additional allowances from what was originally established.

This is different from the bad debt allowance in the loan guarantee reserve fund only in that those loans have not been issued yet and the allowance goes hand in hand with the issuance of those loans. There may not be any need for additional funding for bad debt allowance for current business development fund loans and that is why there is only a $1.00 vote authority.

The establishment of a $1.00 vote authority for an allowance for bad debts under existing loans and a $158,000 allowance for bad debts under the loan guarantee reserve is confusing. In future main estimates there will only be one line item established for the allowance for bad debts to cover losses in both existing loans and in possible loan guarantees.

I can table this somewhat confusing information for the Members. I will circulate it rather than table it.

Mr. McDonald: Yesterday, we asked a related question about the receipts for the loan guarantee service charge. The Government Leader indicated that the location for the receipts is found in the operations budget. Was that checked out? Is that the case? If it is the case, why are the receipts located in operation and maintenance, and not in capital?

Hon. Mr. Fisher: My understanding is that all revenues are shown in operation and maintenance. That explains why the offsetting items are in the operation and maintenance budget.

Mrs. Firth: When the Minister says in his statement, "However, there may be changes in some loan situations, and the vote authority is required to make additional allowances from what were originally established..." What does he mean? What kind of changes is he talking about?

Hon. Mr. Fisher: An allowance is set up each year. That is an estimate of what may be a bad debt. That may change. It may be more or it may be less. That is what it means.

Mrs. Firth: What may be more or less? The allowance for bad debts in the budget book is $1.00. I am not clear about what the Minister just said. He said that an allowance is set up each year, which may change and that is what it means. Here he is saying that there will be changes in the loan situations. That is a bit more specific. Perhaps he could explain that.

Hon. Mr. Fisher: On the balance sheet accounts for the business development fund, as of March 31, 1995, there is an allowance for doubtful accounts. That, again, is an estimated amount. If that amount is not correct, we need a line item to actually come up with whatever the difference may be. One needs some sort of vote authority to change that number if it is not correct.

Mrs. Firth: I understand that, but what is the Minister referring to when he talks about changes to the loan situation? What does that mean?

Hon. Mr. Fisher: Again, the change in the loan situation is that when the loans are reviewed there are more or fewer bad debts than were anticipated the year before. One needs that appropriation or that ability if the estimation goes the wrong way.

Mrs. Firth: Does the Minister mean that if there are changes in some loan situations - I would take that to mean that if some people who have a loan are paying it back, and the government makes an estimate for doubtful debts - it can change because some people pay less back or do not pay any money back and the doubtful debt figure changes?

I understand the principle of needing the line, so that if the government estimates $700,000 in doubtful debts and it increases to $800,000, it can put that in.

The thing that perked my interest was the changes in the loan situations. Is the Minister referring to specific loan situations or just in a general context, that there are changes in the loan situations that affect the total amount.

I understand the business of the total amount, but I am interested in the kinds of changes in the loan situations that can have that kind of impact on the total amount.

Hon. Mr. Fisher: I think the Member understands it. I am reading from some information that has just been passed to me.

Each loan is reviewed as to its payment history, its future ability to repay and the value of its security. Then, each loan is classified into a percentage category as to whether or not it is 25-, 50- or 100-percent doubtful in terms of recovering the outstanding balance, including the realization of securities.

The assessment is calculated on a probability basis. A 25-percent estimate means that one out of four loans completely default, or possibly one or more loans partially default. It would be damaging to outgoing businesses to identify them when they may actually repay all of their loans. The changes would be what happens on the review at the end of each year.

Mr. McDonald: Can the Minister identify for us in the Financial Administration Act where it says that one needs a line item in the budget for this allowance, particularly given that there is already a line item in the budget for essentially the same thing? We are only talking about $1.00 here, but is it not already the case that the Minister has the ability to account for this bad debt and does not need this line item?

Hon. Mr. Fisher: I am told that this is a generally accepted accounting practice. In fact, my question was why we could not just lump it into the line above - the $658,000 - instead of having two separate lines. Apparently, the department is told by the Finance people that this is the proper method.

Mr. McDonald: Certainly if one reads the Financial Administration Act, one realizes very quickly that the only line item one needs is the one vote for the department. That is basically one number and one line item. A lot of this other discussion about having line items for allowances or for a particular project, or anything else, is all an artificial construct that we put ourselves through and is not absolutely essential.

I guess ultimately the point is going to be how much the government anticipates will be lost and how much the taxpayer is going to have to pay, and whether or not these programs are self-financing in the long run. The issue will be why the taxpayer should have to pay anything when it comes to these doubtful accounts if these programs are, indeed, self-financing?

Allowance for Bad Debts in the amount of $1.00 agreed to

Industry, Trade and Investment in the amount of $4,945,000 agreed to

Capital Expenditures for the Department of Economic Development in the amount of $7,711,000 agreed to

Chair: We will now move to Yukon Legislative Assembly. Is there any general debate on this?

Yukon Legislative Assembly

Hon. Mr. Ostashek: The operation and maintenance budget proposed for the Yukon Legislative Assembly for 1996-97 totals $3,499,000, which a 4.1-percent increase or $137,000, over the 1995-96 forecast. The major changes in the budget are an increase of $346,000 in the elections program to cover the costs of the next territorial general election and a general election of school councils.

There is a decrease of $246,000 in the retirement allowance and death benefits program.

The explanation on a program-by-program basis are as follows: legislative services has an increase of $55,000 in the legislative services program from the 1995-96 forecast, from $1,571,000 in 1995-96 to $1,626,000 in 1996-97. That was due to MLA pay and fringe benefits that have been increased by $15,000 as a result of indexing by 1.2 percent; MLA indemnities and expense allowances on April 1, 1996, and MLA pay and fringe benefits show a further increase of $34,000.

On an estimate-to-estimate basis, there is no increase. This shows as an increase over the forecast because the forecast reflects a reduction caused by the vacancies in Vuntut Gwitchin and Whitehorse West for approximately one-third of the current fiscal year.

Caucus support services show an increase of $15,000. In fact, there has been no change from 1995-96 in the amount allocated to each caucus for research and secretarial services.

The reason the forecast is $15,000 less than the estimates is because $13,000 was taken from caucus funding due to the vacancies in Whitehorse West and Vuntut Gwitchin, and because $2,000 was transferred from O&M to capital in 1995-96 to cover the costs for computer upgrading for the Official Opposition.

The budget for the legislative committee shows an increase of $4,000 from forecasted estimates. In 1995-96, the Canadian Conference of Public Accounts Committees was cancelled. This conference is scheduled to take place again in 1996, and funding has once again been included in the estimates to cover travel costs for Yukon delegates.

The amount allocated to the CPA Yukon branch has been decreased by $12,000. This reflects the funding that had been allocated on a one-time basis to host the 1996 conference of Canadian Presiding Officers.

The $444,000 shown in the estimates for the Legislative Assembly Office program is a $2,000 decrease from 1995-96. The primary reason for this is a $5,000 reduction in communications.

The 1996-97 budget for the elections program is $513,000, which is $326,000 more than in 1995-96. This increased funding has been requested to cover the cost of the next territorial general election and the next general elections for school councils.

The 1996-97 budget for retirement allowances and death benefits is $480,000, which is a $246,000 decrease from the 1995-96 forecast. The change is due to the following: during the 1993-94, 1994-95 and 1995-96 fiscal years, outstanding liabilities have been amortized at a rate of $248,000 per year. The outstanding liabilities have now been completely covered and it is not necessary to include this amount in the 1996-97 budget.

The current year contributions to the MLA pension plan have been increased by $6,000, as a result of the 1.2 percent million increase in MLA indemnities and expense allowances.

Consulting services are reduced by $4,000, as the 1995-96 forecast included funding for the tri-annual actuarial valuation.

The responsibility for the Hansard contract has been transferred from the Department of Government Services to the Legislative Assembly Office. The first activity under this program, transcription services, provides funding of $432,000 to cover the cost of the Hansard contract during the 1996-97 fiscal year. The second activity, electronic services, provides funding of $3,000 for an annual update of the Hansard CD-ROM disk. To provide comparability, the amounts spent by the Department of Government Services on Hansard in 1994-95 and 1995-96 are included.

On the capital side, the capital budget proposed for the Yukon Legislative Assembly for 1996-97 totals $28,000, which is a $17,000 decrease from the 1995-96 forecast.

Of this budget, $25,000 is to be allocated to the purchase of a photocopier, fax machine and two computer workstations; $3,000 is allocated for the purchase of miscellaneous furniture.

On Operation and Maintenance Expenditures

On Legislative Services

On Legislative Assembly

Legislative Assembly in the amount of $1,126,000 agreed to

On Caucus Support Services

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

On Legislative Committees

Legislative Committees in the amount of $19,000 agreed to

On Commonwealth Parliamentary Association

Commonwealth Parliamentary Association in the amount of $32,000 agreed to

Legislative Services in the amount of $1,626,000 agreed to

On Legislative Assembly Office

On Clerk's Office

Clerk's Office in the amount of $445,000 agreed to

Legislative Assembly Office in the amount of $445,000 agreed to

On Elections

On Chief Electoral Office

Chief Electoral Office in the amount of $114,000 agreed to

On Elections: Education Act

Elections: Education Act in the amount of $50,000 agreed to

On Elections Administration

Mrs. Firth: I have a private Member's bill on the Order Paper, which defines when an election should be held. About one year and a half ago, I put the private Member's bill on the Order Paper, and the Government Leader told me that he might be prepared to discuss it. Since we are probably only about six or seven months away from an election, I wonder if the Government Leader could tell me if he supports the principle of our having a set date for elections in the Yukon.

Hon. Mr. Ostashek: Since we are this late in the mandate, I think I will leave it to the next Legislature to decide.

Elections Administration in the amount of $349,000 agreed to

Elections in the amount of $513,000 agreed to

On Retirement Allowances and Death Benefits

On Retirement Allowances

Retirement Allowances in the amount of $480,000 agreed to

On Death Benefits

Death Benefits in the amount of $1.00 agreed to

Retirement Allowances and Death Benefits in the amount of $480,000 agreed to

On Hansard

On Transcription Services

Transcription Services in the amount of $432,000 agreed to

On Electronic Services

Electronic Services in the amount of $3,000 agreed to

Hansard in the amount of $435,000 agreed to

Operation and Maintenance Expenditures for Yukon Legislative Assembly in the amount of $3,499,000 agreed to

On Capital Expenditures

On Legislative Assembly Office

On Office Furniture, Equipment and Systems

Office Furniture, Equipment and Systems in the amount of $28,000 agreed to

Legislative Assembly Office in the amount of $28,000 agreed to

Capital Expenditures for Yukon Legislative Assembly in the amount of $28,000 agreed to

Yukon Legislative Assembly agreed to

Chair: When we return from our break, we will begin the Executive Council Office.

We will now take a brief recess.


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

Hon. Mr. Fisher: I forgot to circulate some documents that I promised yesterday. I would like to do so now if I may.

Chair: We are dealing with Bill No. 11, Executive Council Office.

Executive Council Office

Chair: Is there any general debate?

Hon. Mr. Ostashek: I would like to provide a few introductory comments on the operations and maintenance budget for the Executive Council Office.

Before we proceed into a detailed discussion of the estimates, this budget requires $9.6 million in spending for the Executive Council Office for 1996-97. This is a decrease of $336,000 from the current year's spending.

Resources for land claims negotiations and implementation remain paramount in this budget, reflecting the importance the government places on the settlement of land claims. In addition, the budget contains $1.6 million for land claims implementation projects, boards and committees.

Overall, the personnel and other costs for the department have been reduced by $350,000. Transfer payments have risen slightly by $73,000. The level of recoveries has also decreased from 1995-96 by $331,000. This reflects changes in a number of areas.

The budget before you proposes a $165,000 decrease in funding for aboriginal language services. I am, however, pleased to report to the House that our efforts have been successful in obtaining more funding for this program in the coming fiscal year.

The recent federal budget provided $909,000 for aboriginal languages this year. This is an increase of $140,000 over what was predicted. This, I believe, was a vote of confidence in the program and our efforts to support First Nations and aboriginal language speakers with the development and enhancement of the Yukon's aboriginal languages. The additional amount available for the aboriginal language services will be presented to the House in the supplementary estimates.

The French language service budget proposes a decrease of $131,000 as a result of reduced federal funding from Canadian Heritage announced in February 1995. Operations have been reprioritized so that there is no loss in service delivery to the francophone public despite fewer resources. Resources previously used to support positions in Education have been re-allocated to provide translation services to the Department of Education. The branch will reduce its requirement to contract translation services as a result of adding this translator to the unit.

As well, the completion of some publication and sign projects have also contributed to a reduction in other expenditures.

The proposed spending of the Bureau of Management Improvement has remained largely unchanged for 1996-97. There are increased personnel costs to provide merit increments to eligible staff and contract services have been reduced.

The budget for the Bureau of Statistics for 1996-97 has been increased from 1995-96. This increase reflects the anticipated federal recoveries, national surveys of health and youth. These surveys are conducted under a contract with Statistics Canada and are completed every second year. In the Commissioner's office, there has been a small decrease in the budget. The 1995-96 fiscal year included extraordinary expense to complete some one-time office repairs.

The proposed budget for the Cabinet offices has decreased slightly for the coming year. Increased personnel costs will be required for merit increases to eligible employees. This budget reflects planned reduced costs for Ministers' travel.

In conclusion, the spending for this department has decreased from 1995-96. The Executive Council Office has continued to maintain this government's commitment to controlled spending while maintaining quality programs and service to Cabinet, other departments and to Yukoners.

Chair: Before we continue, I would like to correct the record. I believe I introduced this as Bill No. 11 when, in fact, we are dealing with Bill No. 10, entitled First Appropriation Act, 1996-97.

Mr. McDonald: I have a few questions that I would like to ask. I would like to talk a little bit about the Ombudsman office tonight because I realize that the Executive Council Office is designing the new proposal for the Ombudsman service.

I have some outstanding questions that I had previously asked the Minister. One was about travel by Ministers. I asked for some specifics on the travel taken by Ministers in the last year and by political staff. I would like to know if that information will be provided.

One other outstanding question was about the RCMP investigation. We passed a motion in the House agreeing to provide certain information respecting that particular situation. I wonder if the Minister can tell us when we can get that information, and will it be during this estimate's discussion?

Hon. Mr. Ostashek: I have the legislative return on travel with me, and I will table it now. I will check with the deputy minister about the report tomorrow to see when it will be available. I do not know for sure. To be truthful with you, I do not know whether or not we have received the final report from the RCMP.

As I think back, I know that we have not. The person who was going to write the report was called away to a court case. I know that we do not have the final report yet.

Mr. McDonald: I would like to spend a little time talking about the Ombudsman service and the selection process.

I know that the Minister has thought about how the permanent Ombudsman should be selected. I would like to get his thoughts on that question. To select an Ombudsman who already provides a service does not necessitate that the process determine whether or not the candidate has the administrative skill to do the service. If we contract with the Alberta Ombudsman's office for the Alberta Ombudsman to provide the service, it is a fairly routine matter to simply accept that contract of service. However, if we do go through the process of selecting a Yukoner who has never been an Ombudsman, it is not as simple as selecting a person who, for example, will sit on the Human Rights Commission. This person will have to be technically competent. It is not as simple as putting forward names and hoping that we can come to some sort of agreement between politicians on who might be an acceptable personality for the job. There will obviously be some technical qualifications, and there will presumably be a salary to match.

Can the Minister tell us what thought he has given to the selection process, and how that will involve Members of the Legislature?

Hon. Mr. Ostashek:

Prior to engaging the Alberta Ombudsman, we were in this very process. What I see happening is that we will go out to competition and consult with the Opposition for the terms of reference for the position. I believe that would be the fairest way to do it. We cannot just put forward names and pick one. It would have to be through a competition, with the terms of reference to be set by representatives of the Legislature and the Opposition. Terms of reference that are acceptable to everyone would be drawn up and then it would go to competition. I would see Members of the Legislature possibly sitting on the interview committee.

I am open to anything on it. It is a position on which I am not going to get into a partisan political debate. It has to be passed by a two-thirds majority of this Legislature, so it is incumbent on us all to cooperate to try to come up with the best person for the job.

Mr. McDonald: I am certainly in agreement with the Minister on the general objective, and I want to make sure that we are all on the same wavelength when it comes to political participation.

With respect to consultation on the terms of reference, the Minister is, I am assuming, referring to consultation with all MLAs. Is that correct?

Hon. Mr. Ostashek: Yes. It would involve all MLAs. It may be that the Legislature may not be sitting. I would call the Leader of the Official Opposition and he could confer with his caucus, the Liberal Party and the Independent Member.

Mr. McDonald: In terms of the selection of the staff for the Ombudsman's office, who does the government anticipate would be involved in such a process? Who actually sets up the office?

Hon. Mr. Ostashek: I believe that the Member is inquiring about the assistant to the Ombudsman position. We would visualize the interviews for the position being carried out by the Alberta Ombudsman and the Clerk of the Legislative Assembly.

Mr. McDonald: So there will be two people on the interview committee. Will there be anyone from the Public Service Commission to identify technical qualifications and to conduct reference checks?

Hon. Mr. Ostashek: Apparently, we have a private-sector company providing technical assistance and preparing a statement of qualifications and draft-interview questions and carrying out the initial screening of applicants. As I said, this service is being provided by a private-sector company with expertise in this area in order to keep this recruitment process independent of government.

Mr. McDonald: What is the name of that company?

Hon. Mr. Ostashek: Clarity. They are based in Whitehorse.

Mrs. Firth: Clarity is the name of the company? I see the Government Leader nodding his head "yes". Was this service put out to tender?

Hon. Mr. Ostashek: It was a sole-source contract.

Mrs. Firth: Could the Government Leader tell us why it was sole-sourced and not put out to an invitational tender?

Hon. Mr. Ostashek: It is my understanding that there are very few companies in the Yukon that have this expertise, and this is a very small contract.

Mrs. Firth: Perhaps the Government Leader could tell us how much the contract is for and what the required expertise consists of.

Hon. Mr. Ostashek: The contract is for $2,000 and the company has expertise in job analysis and the services that we would be requiring for recruiting this position.

Mrs. Firth: What does the Government Leader mean by "job analysis"? Exactly what has this company been contracted to do?

Hon. Mr. Ostashek: Basically, what I have just read into the record. I will read this into the record one more time. It says that it will provide "technical assistance in preparing the statement of qualifications and draft-interview questions and carrying out an initial screening of applicants. An initial screening of applicants is being provided by a private sector-company with this expertise [this is the Clarity company] in order to keep the recruitment process independent of government."

Mrs. Firth: Perhaps I could get an explanation of how this is going to work. Did this consulting company draw up this employment opportunity? Did it prepare the assistant to the Ombudsman employment opportunity? The Minister is nodding his head indicating "yes". Did the consulting company draw up the position summary that has been presented to us as well?

Hon. Mr. Ostashek: The position summary was done by the implementation committee that was working on the Ombudsman Act.

Mrs. Firth: Who is on the implementation committee?

Hon. Mr. Ostashek: They were representatives from the Executive Council Office, the Public Service Commission and Government Services and it is chaired by my assistant.

Mrs. Firth: We have two actors in the process. I want to establish how this is working. Clarity has drawn up the offer for the employment opportunity. They are going to give technical assistance advice and draft questions for the interview and screen the applicants. Is Clarity actually going to interview the applicants?

Hon. Mr. Ostashek: They will not be doing the actual interviewing. They will be screening the applicants based on the statement of qualifications. What I see them doing is weeding out those who are not acceptable and then those who are on the short list will be interviewed by the Ombudsman and the Clerk of the Legislature Assembly.

Mrs. Firth: So, this consulting company actually get a copy of all the applicants and their statements, job resumes and so on. When a person applies for the job of assistant to the Ombudsman, their application will go to Clarity, Clarity will short-list them and give the short list to the Ombudsman from Alberta and the Clerk of the Legislative Assembly, who will then interview and hire the assistant to the Ombudsman - is that correct?

Hon. Mr. Ostashek: That is correct, but in addition to that, the Clerk and the Ombudsman will also be reviewing the applications from the applicants who were screened out.

Mrs. Firth: What does the Minister mean by reviewing?

Hon. Mr. Ostashek: They will review the applications that Clarity has eliminated.

Mrs. Firth: If the Ombudsman and the Clerk think that some of the applicants who were screened out by Clarity should be interviewed, is that possible?

Hon. Mr. Ostashek: I believe so. I see no reason why it would not be possible. I think that is the reason they will be going over the applications that are screened out by the consultant.

Mrs. Firth: It could raise the question of why the consultant has to do the screening in the first place. I appreciate the business of wanting to look like it is independent or whatever, but I fail to see why Clarity would do the screening if the Clerk and the Ombudsman can do the screening and make the short-list themselves. There seems to be a bit of an overlap. Perhaps the Minister could explain it?

Hon. Mr. Ostashek: Perhaps I was not quite clear. I will try again. They are going to review the results of the screening as a final check. They will not be doing the detailed work that Clarity will be doing. It is going to depend entirely on the number of applications that come forward.

Mrs. Firth: Perhaps the Minister could explain exactly what he means by "review the results of the screening". I will tell him what my interpretation of what he said is, which might help him clarify. Clarity is going to get all of these applications for the assistant to the Ombudsman. They are going to go through the applications and screen out the ones who they think will be eligible candidates for the position. What exactly is it that the Ombudsman and the Clerk are going to review?

Hon. Mr. Ostashek: Let us just take a hypothetical case in which there were 50 applications. Clarity comes along and says, "We feel that five are highly qualified for the job. We feel that another 10 could be qualified for the job. We do not think that the rest will be." The Ombudsman and the Clerk would then look at that and see if they agree, just by glancing at a few random applications and not by going through each one in detail.

Mrs. Firth: That is my concern. If the Clerk and the Ombudsman are going to go through them anyway -

Some Hon. Member: (Inaudible)

Mrs. Firth: The Minister is saying that they may not. However, if there are only 10 applications, they may very well go through all of them. What is the point of having Clarity screen them, and then the Ombudsman screening them again? It is something that I want to establish. Who gets to make the final decision as to who the qualified applicants are going to be? Is there some ability for the Clerk and the Ombudsman to say, "We think you should have included applicant a, b and c, and you did not." If there is going to be this double screening process, maybe they should all be sitting down and screening it together. I do not know. I do not understand the process and who gets to have the final say about who gets interviewed.

Hon. Mr. Ostashek: I have been involved in applications to government for a somewhat limited time. In one competition for deputy minister, some 150 or 160 applications were received. I cannot go through all of the applications, in order to short-list them and pick out the ones who should be interviewed.

The Public Service Commission and other departments have helped and advised us about their choice of candidates to interview for the positions. I see Clarity doing the same thing - it is going to screen them against the statement of qualifications that has been set up for the program. Clearly, there are going to be some that do not meet the standard, so they will be discarded. The end result is that the Ombudsman and the Clerk will decide who is going to be hired.

Mrs. Firth: The reason I ask this many questions is that I am sure some people will complain that, at some stage of the game, they did not think they were treated fairly, or whatever, which is why I am interested in knowing how it is going to work, so I know who to direct questions to and what the process is.

Perhaps the Minister could provide us with a written statement about how the hiring process is going to work and what Clarity's responsibilities are. I would not mind having a copy of the contract, too, in order to see the terms of reference and what the responsibilities of the Ombudsman and the Clerk are going to be in the hiring process.

Hon. Mr. Ostashek: I will see what I can bring back for the Member.

Mrs. Firth: Is the job of assistant to the Ombudsman a full-time job? Is there any term or length of appointment attached to it? Is it forever and ever?

Hon. Mr. Ostashek: It is my understanding that it will be an employment contract for one year while we are setting up the office, with a possible extension.

Mrs. Firth: It is a contract position then? The contract will be between $40,000 and $50,000? What is it based on?

Hon. Mr. Ostashek: I would assume it would be based on qualifications.

Mrs. Firth: Is Clarity going to determine that? Ordinarily, the Public Service Commission would do it. Who will do it in this case?

Hon. Mr. Ostashek: The interview team will do it - the Ombudsman and the Clerk.

Mrs. Firth: Will the Ombudsman and the Clerk determine the salary to be attached to the qualifications of the individual? The Minister is nodding his head, indicating "yes".

Will the extention of the contract be determined by the Ombudsman and the Clerk?

Hon. Mr. Ostashek: I would think it would be made by the Ombudsman if the person were qualified. I do not know why we would go back out to competition if the person wanted to stay on.

Mrs. Firth: It raises a bunch of questions. Is this all set out in procedure? I am skeptical about the Minister's answer when he says that he would assume something or think something else. I would like to get more definitive answers if I could.

Hon. Mr. Ostashek: I would like to be able to give the Member more definitive answers, but this is all new so we are moving cautiously and we are going to implement a one-year term employment contract. If the Ombudsman feels that this person has done a good job, there will be the option to extend the contract. What I am saying is that I do not know why we would want to go back out to competition at that point. This is all new, and we are establishing the rules as we go along.

Mrs. Firth: It is kind of nice to have some rules in place to begin with, which leads me to ask other questions.

Who is this assistant going to be reporting directly to? Will it be the Ombudsman? The Minister is nodding his head saying "yes". So conversely, if the performance was not satisfactory, the Ombudsman would be dealing with that independently. This person will be the employee of the Ombudsman? I see the Minister nodding his head that that is correct.

I have another question, but I need to think about how I want to pose it. Perhaps another Member would like to ask questions.

Mr. McDonald: Once the office is initially established, who is involved in selecting future staff and how is that going to be constructed? Will that be the exclusive decision of the Ombudsman, whoever that person is. Who will manage the office budget? As I understand it, the employment contract is initially with the Legislative Assembly Office. What happens after that takes place? Is this going to be a stand-alone entity? Is there going to be some form of contribution agreement so that it can act completely independent of the government, including the Legislative Assembly? Is that how the office will be structured?

Hon. Mr. Ostashek: There is a separate vote in the budget for that office, but I think it is going to be done through the Clerk for some independence. I am not certain of that. I gather the Member is asking who will draw up the budget. The Ombudsman, under the legislation, is required to consult with the Member Services' Board on the budget.

Mr. McDonald: So the Legislative Assembly Office itself is not going to have any responsibility. It will be a vote, and the money will be contributed in some way directly to the Ombudsman, who will manage the office and not have to be beholden to anybody in government for the expenditure of those funds. Is that right?

Hon. Mr. Ostashek: In general terms, I believe the Member is right. There may be some assistance provided by the Legislative Assembly Office to help draft budgets if required, but we are trying to keep it as independent as possible so that it is devoid of political interference.

Mr. McDonald: I have got the act and it is reasonably clear with respect to who employs whom. Did the Minister, at some point, say the Public Service Commission was going to be responsible for employing some secretarial support, or is the Office of the Ombudsman going to have its own staff, completely independent in every respect? Is that right?

Hon. Mr. Ostashek: Yes, the Member opposite is right. I was wrong when I made that assumption the other day.

Mrs. Firth: I suppose the Office of the Ombudsman then will have complete jurisdiction over what kind of services it wants to provide and how it wants to provide those services. I just want to know how this is going to work.

I know in other Offices of the Ombudsman, they do such things as advertising and they have a certain amount of media exposure and press coverage. In some instances, they advertise their services, make determinations about how high profile and how public a service they are going to provide in the context of revealing what is going on. If someone has said they have gone to get help from the Office of the Ombudsman it can often become a fairly public issue. Is there going to be a complete free rein given to the Office of the Ombudsman with respect to that, or are there going to be some parameters set up?

Hon. Mr. Ostashek: If we talk about advertising, they would be able to make their own decisions on that. However, the budgets will be set in conjunction with the Members Services Board. They are just not going to have a blank cheque to run the office of the Ombudsman.

The legislation sets out how they can go about investigations. They cannot initiate investigations without a complaint. That is set out in the legislation. How the budgets are spent once they are cleared through the Members' Services Board would be their own decision. The cases that they are investigating are all very confidential.

Mr. Sloan: I would like to change tack for a second.

I can see that the figures for aboriginal language services have decreased because of federal contribution decreases. However, I noticed that there is a substantial reduction in personnel costs. Can the Minister give us an idea of what the impact of those reductions in personnel have been?

Hon. Mr. Ostashek: I went through it in my preliminary remarks. The main estimates show a budget of $769,000 for the program, and this budget was provided on an estimate prior to the tabling of the federal budget in Ottawa. When the feds tabled their budget, the actual budget we will get for the aboriginal program for the 1996-97 fiscal year is $909,000. It increased by $140,000 from what we had expected.

As a result of that, some staff hours will be cut but it will not be as dramatic as we had been planning earlier. The budget currently shows a significant decrease in staffing costs, but the additional funding will allow for an increase in staff hours and plans are currently being finalized, but we anticipate most staff will be working three-quarters of the time.

Mr. Sloan: I understand that this is one service that is due to be devolved to the First Nations. The information I was given was that eventually this would be devolved to each of the individual First Nations. In other words, each First Nation would have some control over the aboriginal language services. Is that in the plans?

Hon. Mr. Ostashek: We are presently in discussions with the Council for Yukon First Nations concerning the delivery of the service. It is not a service that we can entirely devolve to the First Nation, because we have the ultimate responsibility of providing the interpretive services. We are talking with the Council for Yukon First Nations to deliver the service, so that they will have more control over it, but we have to be in a position where the obligation for delivering services is to the territorial government. If they did not deliver the service, we would still be responsible for it. So, we are looking at them for service delivery.

Chair: Is there any further general debate?

Mr. McDonald: I have a series of questions about land claims devolution, and I have some follow-up questions, given the time, with respect to the aboriginal language services.

As a result of cuts, I understand that the territorial agent services in some of the communities have been cut back. In fact, service was cut in Ross River and Pelly and, as of April 1, 1996, the territorial agent services will not be offered in Carmacks, Teslin or Beaver Creek.

What is the government's plan to provide territorial agent services? Are the services simply going to be eliminated as a result of this cut? Given that aboriginal language services will still be offered in the communities, why can there not be territorial agent services, even if only on a part-time basis?

Hon. Mr. Ostashek: The only reason that we were able to provide the territorial services was because of the aboriginal language services that were in the communities. Otherwise, those communities would not have had territorial agents. As a government, we have repeatedly indicated that we would not step in to provide services eliminated by federal cutbacks. We are not going to pick up the slack that the federal government cuts us by, so we had to cut back on them.

Federal funding cuts to aboriginal languages required adjustments in how this program is delivered. In the coming fiscal year, these cuts will result in a reduction of staff hours at Carmacks, Teslin and Beaver Creek. These reductions no longer make it possible to offer territorial representative services. Existing staff will now be fully occupied with services directly related to the mandate of the aboriginal languages services. An example of this is the provision of interpretive services and other aboriginal language services in the community. When territorial representative service was developed by the previous administration, no separate allocation of funds was made that could now be reallocated to another agency so that service can continue. The departments responsible for these services have alternate arrangements for their delivery.

The government remains committed to the development and enhancement of the aboriginal languages through the provision of the interpretive and other language services in the communities, either by resident staff or through contribution agreements to First Nations or tribal councils. This is consistent with its interest in assisting the development of the pool of skilled interpreters.

I will just give a brief overview of how the departments are going to provide the territorial services in Carmacks, Teslin and Beaver Creek. Hunting and fishing licences in Beaver Creek will be issued by Canada Customs, the resource management officer and the Department of Indian and Northern Affairs. In Carmacks, hunting and fishing licences will be available at the Tatchun Centre Store. Fishing licences are also sold at the Northern Tutchone Trading Post. In Teslin, these licences are available from the conservation officers' office.

There is a mail-in service for motor vehicle registrations and drivers licences. This service is also available at the nearest territorial agent or in Whitehorse. Individuals can pay court fines by VISA over the phone with the court clerk during circuit court, in the communities or at the nearest territorial agent in Whitehorse.

Consumer and corporate licence fees and licences can be obtained in Whitehorse. Fees can be paid at the nearest territorial agent or in Whitehorse. Vital statistics and health care registration can be done by mail or fax. Services can be obtained at the nearest territorial agent or in Whitehorse. Where there is no territorial agent, health care registration can be done at the nearest nursing station.

Marriage licences can be obtained from the nearest territorial agent or in Whitehorse. Other vital statistic services may be obtained by phone, mail or fax in Whitehorse or at the nearest territorial agent.

Contract administration and information on government tenders will continue to be posted in First Nation municipal offices. In Carmacks, Teslin and Beaver Creek, they are posted in the First Nation office.

Mr. Chair, I move that you report progress on Bill No. 10.

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. Millar: Committee of the Whole has considered Bill No. 11, Interim Supply Appropriation Act, 1996-97, and directed me to report it without amendment.

Further, Committee has considered Bill No. 10, Third Appropriation Act, 1996-97, and directed me to report progress on it.

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.

Hon. Mr. Fisher: I move that the House do now adjourn.

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

Motion agreed to

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

The House adjourned at 9:29 p.m.

The following Sessional Papers were tabled March 27, 1996:


Health Status Report (Yukon, 1994) (Fisher)


Documents pertaining to Motion No. 104 regarding the call for a public inquiry (Phelps)


Certificates of Title pertaining to the fee simple lots referred to in Motion No. 104 (Phelps)