Whitehorse, Yukon

Thursday, February 25, 1999 - 1:30 p.m.

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



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

Are there any tributes?

Introduction of visitors.


Speaker: I have a visitor from Vuntut Gwitchin, Lorraine Netro, who will be travelling to Washington on behalf of the community of Old Crow to lobby for the caribou on the 10-02 lands.


Speaker: Are there any returns or documents for tabling?


Hon. Mr. McDonald: Mr. Speaker, I have some legislative returns for tabling.

Speaker: Are there any reports of committees?

Are there any petitions?

Are there any bills to be introduced?

Are there any notices of motion?

Are there any statements by ministers?

This then brings us to Question Period.


Question re: Kluane land use plan

Mr. Ostashek: Mr. Speaker, on February 8, 1999, there was a media release that stated that the NDP government says it has no intentions of shelving a land use plan for the Kluane region. The minister even went on to say that he would like to see the plan in place within a year. As the minister is aware, there is a lot of opposition to the Kluane land use plan, and I would like to ask a question of the minister today. Is it his intention to go ahead and implement the Kluane land use plan in its present form?

Hon. Mr. Fairclough: Mr. Speaker, when we first got elected, the people of Haines Junction gave us direction and asked that we take the Kluane land use plan off the shelf, have a look at it, and fine tune it, as best as we can. We've done that. We've made some changes to the plans. We've made some fairly big ones, and we would like to continue to work on the plans with the community. We know that there are some concerns that the people in Haines Junction have with it, and we will be trying to address them and continue to work to improve the plan, so we can use it as a guiding document.

Mr. Ostashek: Well, thank you. I'm not sure I got a complete answer there. The minister is aware that there was a community meeting in Haines Junction on February 11, which was attended by over 100 people. There was very little, if any, support at that meeting for the Kluane land use plan.

The feelings of the community and the people in the Kluane district is that this plan is obsolete. They wouldn't mind having a land use plan, but they wanted to see one that was brought up to date - a new plan to address major issues. They're very, very concerned that the Kluane land use plan, as it is, Mr. Speaker, precludes development in the area.

So, I want to ask the minister quite clearly: does he intend to continue to work with that plan or is he going to start on the process to have a new plan for the Kluane area, and when does he believe it's going to be implemented?

Hon. Mr. Fairclough: Mr. Speaker, the people from Haines Junction, the First Nation, the village, the renewable resource council and a number of people have spoken at this meeting and in the past. They have all voiced concerns in regard to this plan, but they have also voiced that they would like a plan and they want us to continue to work with them to try to improve the plan, and we're doing just that. We're continuing to work with the community and listen to people and hopefully we will come up with some changes soon and continue working with the people of Haines Junction to improve the Kluane land use plan.

Mr. Ostashek: Mr. Speaker, the minister, I believe, has received 159 letters from the Kluane area against the implementation of the Kluane land use plan - the one he has now that he took off the shelf, that's 10 years old - a plan that I might say, Mr. Speaker, was conceived prior to there ever being a protected spaces strategy; prior to there ever being a DAP process. They believe that the plan right now is redundant, because it precludes mining, and very limited forestry.

They said they don't mind seeing a plan, but they wanted a completely revised plan. Is it the minister's intention to consult with people other than the people in Haines Junction? We know that they're against it, but there are a lot of other people in the Kluane constituency besides the people in Haines Junction.

Is he going to hold public hearings throughout the Kluane area on the Kluane land use plan before he implements it?

Hon. Mr. Fairclough: Mr. Speaker, we have been listening to the people in the Kluane area and the Haines Junction area. With regard to the plan, it contains an area that included a number of First Nations. Because negotiations were not completed, the plan was revised to be only within the Champagne-Aishihik traditional territory, where there was no overlap.

We feel that we can work with this plan and work with the community to try to improve it. It doesn't mean that we are creating more red tape. It's something that the community wants, and wants us to continue to work with, and we will do just that.

Question re: Workers' Compensation Act review

Mr. Jenkins: I have a question today for the minister responsible for the Yukon Workers' Compensation Health and Safety Board.

On October 30, 1998, the minister announced that the Workers' Compensation Act would be reviewed commencing in early February. An option paper was promised some four months ago, yet we haven't seen anything to date. To make matters worse, many of the recommendations of the public inquiry respecting the Yukon Workers' Compensation Health and Safety Board that were completed in June of 1996, and in particular all of the legislative changes to the WCB act at that time, have not been implemented.

My question for the minister: can he explain why some two and three quarters years have passed, yet no legislative changes to the act have been made, and what assurances do the stakeholders have that the current review that the minister has announced - after it's completed - that that won't be put on the minister's bookshelf beside the 1996 review?

Hon. Mr. Harding: Well, Mr. Speaker, let me say that the member's premise to his first question is wrong. We never promised an option paper four months ago. The act review has been engaged. There are people already working on it. I've got some meetings, actually, this afternoon with some people who are engaged in that process.

The member opposite should know that I met with the stakeholders, the people who are actually responsible for the system, to discuss the timing of this act review. They were completely in agreement that it should be for the fall of 1999. We're on schedule, as was agreed to with the stakeholders. These are people I actually talked to. The member opposite, when he goes to the meetings, hangs around for a few minutes, has a doughnut, then runs out the back door. I sit around and actually talk to the stakeholders about the issues, agree, try and get some consensus with them on the issues, and I'm sticking to the schedule that we agreed to together.

Mr. Jenkins: Well, the minister of everything that walks the walk but can't put into action anything hasn't done anything with the WCB act to date. There's a consultation process that the minister admitted is underway, but what are the terms of reference? When are we going to see those terms of reference, because the information is filtering down that only a small portion of the act is going to be reviewed.

Now, why can't we have a full review of the WCB act? Can the minister advise the House why he's restricting it to certain areas?

Hon. Mr. Harding: I thank the Member for Klondike for saying I'm a minister that walks the walk. I appreciate the compliment.

Mr. Speaker, I want to say to the member opposite that we fully intend to live up to our obligation to conduct an act review. We believe that, in order for it to be effective, it's got to be somewhat focused on the major issues surrounding WCB in the territory today. I think that, clearly, from my discussions with stakeholders, those range from the appeal process to the accountability of the board to the constituencies that they represent in labour and in the employers. There has to be some further discussion about issues pertaining to premiums and compensation.

We want to focus on the key priority areas in this particular act review and, of course, the employers and the workers are going to be involved, as the owners of that system, completely throughout the process.

Mr. Jenkins: Well, unfortunately, the injured workers are caught in an unfortunate situation when it comes to the WCB act. Their lives and livelihoods hang in the balance on the legal and technical language of this act, yet they suffer from the disadvantage of not being in a position to ensure that the legal language of the act meets the realities of their injuries and circumstances.

Will the minister ensure, therefore, that the workers' advocate is included in the review steering committee, and that the injured workers receive the necessary resources to submit their own legislative proposals, so that the revised act will, in fact, do the job that is intended?

Hon. Mr. Harding: Well, Mr. Speaker, the member opposite isn't listening. Workers will be a major part of this review.

It's so ironic to hear the Yukon Party talk about the workers' advocate. I fought for two years in this Legislature with the Yukon Party government to get the position of workers' advocate established. This was long before the Gladish report was even conceived of, and constantly, I was stonewalled by the Yukon Party because there were a few people in the business community telling their friends in the Yukon Party not to create the workers' advocate. Now, all of a sudden, the member opposite tries to somehow seem as if they've been pushing this very important position all along. Nothing could be further from the case.

Mr. Speaker, we're very committed to the workers' advocate. That's why we created the position. We felt it was essential to providing injured workers a fair access to the system and the appeal process.

So, Mr. Speaker, we intend to involve injured workers in this act review, and as a matter of fact, we worked with them to develop the timelines for this particular initiative.

Question re: Stewart Crossing grader station fuel tank

Mrs. Edelman: Mr. Speaker, my question is for the Minister of Community and Transportation Services. Now, yesterday, I asked the minister about his plans to put a service station and a number of people in Stewart Crossing out of work. I asked the minister yesterday if the company that currently supplies the fuel for Stewart Crossing will be allowed to bid on the new contract that begins April 1, 1999. I'm just trying to understand the issue here.

Can the minister confirm today that the gas station in Stewart Crossing will be allowed to bid on the new fuel contract?

Hon. Mr. Keenan: Yes, Mr. Speaker, absolutely.

Mrs. Edelman: Mr. Speaker, the minister told the House yesterday that the reason he was not going to use the Stewart Crossing gas station was because he was trying to save the government money.

Now, he said that the government would save $21,000 by putting in their own tanks instead of using the private gas station. Mr. Speaker, figures I have seen indicate that the government would save more money by putting their own tanks in Whitehorse and having government vehicles use those tanks.

Now, in Dawson City, there would be a similar savings if government vehicles used gas tanks, and that savings would be somewhere around $30,000.

Now, it's possible to save more money for YTG by doing this in other towns. Why is this government doing this in Stewart Crossing?

Hon. Mr. Keenan: Well, Mr. Speaker, first of all, I'd like to clarify. If I said yesterday that it was to save government funding or government money - inadvertently government will save money - but predominantly the issue is to save taxpayers their dollars.

As we look at it, yes, we will be having very significant savings here. It was actually invoked because of the amount that we could save here. The amount would be approximately $23,000 per year, so we're certainly looking at it in that light at Stewart Crossing.

Mrs. Edelman: Mr. Speaker, I understand that the minister has plans to install their own fuel tanks in other rural communities as well, not this year but in future years. Mr. Speaker, are we going to be going through this same situation in places like Carcross and Ross River? How many private gas stations is this going to affect in the long run, particularly in the rural communities?

Hon. Mr. Keenan: Well, Mr. Speaker, as I've said, this is not out to create anything with business. This is certainly out to save the taxpayers' dollars. We're doing it in Stewart Crossing because there's going to be a very significant savings there. Have we looked at other areas? No, we have not looked at other areas, because we are not going to get into competition with private business. But in this case, we certainly are going to realize significant savings. As I said in my first answer to the Member for Riverdale South, the ability of the local service station to bid on that fuel contract is still intact.

Question re: Taylor Highway, spring maintenance

Ms. Duncan: My question is for the Minister of Tourism, also the Minister of Community and Transportation Services.

Yesterday, the issue was raised in this House regarding the decision by the Alaska Department of Transportation and Public Facilities to open the Taylor Highway or Top of the World Highway only after all the snow has melted, which is not likely to be before June 1.

The minister indicated he was working with the protocol agreement signed by the Government Leader and the Governor of Alaska on October 28, 1997. That agreement is still in effect. The minister acknowledged the urgency of this issue. This matter must be a priority at the political level and not left, languishing, awaiting an answer from Alaska, as the tourism season is rapidly approaching.

The minister will be fulfilling other responsibilities in the near future. Has he asked either another Cabinet minister or the Government Leader to follow up on this issue with Alaska?

Hon. Mr. Keenan: Well, Mr. Speaker, I'm quick to jump at it. I found out about it on the morning of February 22, and a letter was sent out on the morning of February 22. Certainly, this government takes tourism very, very seriously, as is anticipated and depicted in the budget. We take it very, very seriously. So, we shall do everything in our effort to ensure that the highway is open on time.

In my absence - I am not the only person who speaks for this government in Community and Transportation Services. I do have backups, and those backups will be filling that obligation.

Ms. Duncan: Well, Mr. Speaker, I had asked the minister who would be fulfilling the political responsibilities. I don't have an answer yet, but I would like to move on to another question. I'd like to ask the minister what other homework - so to speak - has been done, in terms of speaking with or writing to the Alaskans on this issue? For example, my reading of the information is that the Alaskans have stated that the only way to reduce their budget this fiscal year is to allow the roads that are not maintained in the winter to be open only after all of the snow has melted naturally.

I've been told that there isn't a great deal of snow this year in that particular part of the world - the top of the world, so to speak - and that it would not require a great deal of effort to reopen it to spring driving conditions on May 15.

Does the minister have any idea of what the particular cost might be to open that road? Has he asked his Dawson maintenance people to assess what sort of work might be required for a May 15 reopening?

Hon. Mr. Keenan: Well, the number I have from the Alaska government is that they're going to realize a saving of $300,000 on their side. That is the realization that they have put forth to us.

Ms. Duncan: Mr. Speaker, I thank the minister for that direct answer. The loss to Yukon's tourism industry can be calculated fairly readily, as well, and I'm sure the minister has been aware of the cost of reopening. Is there any room for negotiation, on the part of the Government of Yukon, with the Alaskans on this issue? What sort of a time frame and a process have we got in place for negotiating with Alaska to move to a May 15 opening?

Hon. Mr. Keenan: Well, certainly, Mr. Speaker, we're working on that issue, right now at this very point in time. We're working at the political level, we're working at it within the bureaucratic level.

Is there a time frame at this time? No. I just know that it's very important for the tourism industry, especially the Klondike Visitors' Association. To those members in that area and, well, significantly all over the Yukon, it's important and we're going to work within those best efforts to get it done.

I hope that will bring comfort.

Question re: Workers' Compensation Act review

Mr. Jenkins: Once again, to the minister responsible for the Workers' Compensation Health and Safety Board.

Mr. Speaker, there's a David and Goliath battle going on between the Workers' Compensation Health and Safety Board and the workers' advocate, who's trying to help injured workers.

The Workers' Compensation Board is overfunded, and by all observations, overadministered, while the workers' advocate's office is underfunded.

Can the minister advise the House if there are two vice-president positions already established, and a third one being planned, thus already adding to the exorbitant cost of running the Yukon Workers' Compensation Health and Safety Board?

Can the minister confirm this information?

Hon. Mr. Harding: Decisions on administration are made by the labour and employers on the Workers' Compensation Board. They're citizens from business and citizens from labour who run the system and who are responsible for ensuring that administrative practices are in keeping with good, responsible delivery of service.

In the case the member mentioned, I do not have knowledge of that, nor would I, because I leave the responsibility for that in the proper hands - which is the owners of the system: labour and business.

So, Mr. Speaker, I would also point out to the member opposite that it is very important to us - the workers' advocate. That's why we created the position, that's why we asked the Workers' Compensation Board if they would fund it. That's why the Department of Justice has provided an independent space out of the Workers' Compensation offices to try and give a level of autonomy to that position. They also, I believe, help with some of the funding.

So, we're very, very committed to that position, and to the betterment of this system. That's also why we're doing an act review.

Mr. Jenkins: Well, for the record, Mr. Speaker, the workers' advocate position was a recommendation flowing from the Gladish report, which was commissioned by the Yukon Party and adopted by our party. I might add that this NDP government has failed to implement any legislative changes that were recommended, including those concerning the workers' advocate.

Can the minister explain why, with the dramatic reduction in the number of workers in the territory - consequently, fewer injured workers to serve - why the Yukon Workers' Compensation Health and Safety Board is increasing its staff, creating more senior, expensive positions? Why is this happening now?

Hon. Mr. Harding: One thing that the public of the Yukon has learned is that you can't take the word of the member opposite at its face value, Mr. Speaker. You've always got to really look at what he's saying to find out if there's some legitimacy to it.

First of all, if the member checks the Hansard, he will find out that, before the Gladish inquiry was ever announced, for two years, this member, myself, was asking the Yukon Party government to create the position of workers' advocate.

Mr. Speaker, they refused consistently. It was only when the NDP was elected that there was any effort put into creating this position, which we did. We felt it was fundamental.

Secondly, I've told the member. I agreed with stakeholders, a long time ago, through a major meeting that we held on this particular issue, that the fall of 1999 was the time for a legislative review. That's what the workers and the employers told us.

With regard to the administration costs, when the citizen chair of the board came before this House a couple of months ago, he provided an independent administrative audit of costs of the Workers' Compensation Board, which said that the costs of the board were well in keeping and, in many cases, lower than many other boards across the country. It was tabled for the member opposite by the chair of the board.

Mr. Jenkins: Well, that position, as to the administration costs of the WCB being in line, is pure bunk, and the minister himself knows it.

The minister and the Workers' Compensation Board may not be aware that the Yukon is currently in a recession - thanks, in large part, to this government over here, Mr. Speaker.

I would like the minister now to call for an operational audit of the Yukon Workers' Compensation Health and Safety Board, in order to help streamline the procedures over there, which will ultimately render decisions for injured workers in a timely manner, and look at the excessive administration costs, and bring them into line with the economic reality here in the Yukon. Will the minister give that undertaking to implement an operational audit?

Hon. Mr. Harding: Well, Mr. Speaker, I just told the member. There has already been an independent audit done on the administrative costs. I tabled the report. Perhaps the member should read the report. It was done, I believe, by Coles -

Some Hon. Members: (Inaudible)

Speaker: Order please.

Hon. Mr. Harding: There was a lot of workers' compensation money, which is paid for by employers, and is benefits of workers used to provide an audit of the Workers' Compensation Board.

So, Mr. Speaker, the member is wrong. He's heckling that it was an actuarial study. That's incorrect. It was a full-blown independent audit of administrative costs and a comparison from jurisdiction to jurisdiction right across this country, and its findings were quite startling. I know that the citizen board has put that thinking and the review of that particular information on the administrative costs into their thinking, and I believe they are making some changes in that respect.

Mr. Speaker, we are engaged in a legislative review process. We believe that it's going to yield fundamentally positive change for injured workers and for employers. That's the agreed-upon tack that we took with injured workers and employers, and that's the course we're sticking to, along with the creation of the workers' advocate, along with the hiring of a neutral chair.

Question re: Motor vehicle licensing, graduated for young drivers

Mrs. Edelman: My question again is for the Minister of Community and Transportation Services and it's about an issue that's very important to Yukon young people.

On November 4, 1998, the minister introduced changes to the Motor Vehicles Act and one of the changes was to introduce graduated licensing for new drivers.

The minister has said that this is about improving public safety, and the Yukon Liberal caucus has been asking the government to bring in graduated licensing as well for the past two years.

Now, it's my understanding that this government is telling young drivers that we're going to be waiting two years to see how things are going in B.C. before we implement graduated licensing here in the Yukon.

Now, graduated licensing has been in effect in Alberta and Ontario for some years. What is the reason for the delay in the implementation of graduated licensing here in the Yukon?

Hon. Mr. Keenan: Mr. Speaker, there is no delay in the implementation of graduated drivers licences. I committed, on behalf of this government, that we would consult with the youth and the youth councils. I know it's predominantly not a youth issue. It's a first-time issue, but it affects the youth most, so we said that we were going to consult with them, talk to them, and that's exactly what we're going to do.

It was brought up at the youth conference, and again they asked to be consulted, and we again reaffirmed our consulting with them.

Mrs. Edelman: And, Mr. Speaker, you know, once again, this is a very important issue to youth, and I wonder if the minister could illuminate us as to the timetable for consultation and the development and implementation of the new regulations.

Hon. Mr. Keenan: The second question first - we will be looking at the implementation based on what we find out from the youth and based on some of their direction. We're looking to start that consultation this year before school ends.

Mrs. Edelman: Mr. Speaker, that was the same information that we got during the debate, actually, last fall, and I had hoped that the government would have much firmer timelines by now. If we wait two years, we may have not given people the opportunity for public safety on roads.

Now, can the minister perhaps give us an indication of the cost of consultation or the cost of implementation of the new regulations?

Hon. Mr. Keenan: Mr. Speaker, I do not have an idea of the costs, but I can certainly attempt to get some idea of the costs for them.

This government certainly does take the consultation with the youth seriously, and we do take the safety of the highways very seriously. We just passed the legislation in the middle of December, and here we are in the middle of February, so we are working within in the same calendar school year, and we'll continue to get it done, as I said, within the session. As I'm saying now, it will be done this year.

Question re: Yukon Workers' Compensation Health and Safety Board, operational audit

Mr. Jenkins: Once again, I have a question for the minister responsible for the Yukon Workers' Compensation Health and Safety Board.

Mr. Speaker, bureaucracies are natural breeding grounds for excessive regulation, red tape and delays. What should take a couple of days to resolve can often take months, even years, when the bureaucracy takes over, and the Yukon Workers' Compensation Health and Safety Board is certainly no exception.

Since the minister has refused my request for an operational audit - not the ones he suggested that have taken place, which are audits - he should be able to tell me what the current backlog is regarding the number of workers appealing their claims before the various appeal panels. Can the minister give me that number, please?

Hon. Mr. Harding: Well, Mr. Speaker, I don't have those details at my fingertips. I will provide them for the member opposite. I will tell the member, though, that the position that we've created with the workers' advocate as a government has yielded new access and fairer access to the system for injured workers. There is some work we need to do through the legislative review on the appeal procedure. I certainly concede that, and that's right on schedule.

With regard to the member's comments about the audit that was undertaken; it was an independent audit. I believe the firm was Coles Hewitt that did a major audit on the administration and the administrative costs on a jurisdiction-by-jurisdiction comparison right across this country, and the member should just read the results. I can't speak for Coles Hewitt, but certainly they felt that the administrative costs were in keeping. Now, that doesn't mean there's not room for the board to make improvements there, and I understand that from their reading of this particular initiative - this independent audit - that they're going to be making some changes.

Mr. Jenkins: Well, for the information of the minister, Mr. Speaker, it wasn't an operational audit; it was a financial audit, and there's a heck of a difference between the two. For the information of the minister, I understand that there are 20 claims scheduled to be heard by the various appeal panels up and to mid-May.

In view of the minister's refusal to conduct an operational audit, perhaps he can explain why about half of these claims will miraculously be settled just prior to the hearing dates. That's what's going on right now, Mr. Speaker.

Can he assure the House that the whole object of the exercise is not to deny injured workers their rightful benefits for as long as possible?

Hon. Mr. Harding: Well, does the member seriously think we created the position of the workers' advocate to deny injured workers their benefits? I mean, it's a ludicrous proposition by the member opposite and doesn't have any credibility. Mr. Speaker, let me tell the member opposite that the independent audit on administrative costs, conducted by an outside, independent, well-respected firm, yielded some interesting information, with some facts that I think should be paid attention to. It doesn't mean that there shouldn't be improvements and efficiencies. The board is doing strategic planning; they've formed advisory groups with labour and employers to try to work on the strategic plan to ensure that there is good decision making and good operations at the board. There can be continuous improvement, and I think they're trying to make strides in that direction through consultation with the owners of the system.

Mr. Jenkins: Well, Mr. Speaker, an operational audit would give us answers to the many questions that the minister has not - and he probably cannot provide. He doesn't know the answers. These answers, derived from the operational audit, would ensure that both injured workers and employers are receiving value for their money. I'd ask the minister to reconsider his decision not to conduct an operational audit, or is he just too afraid of what he's going to uncover?

Hon. Mr. Harding: Well, Mr. Speaker, the member should review the four years previous to our government coming in on what access injured workers had to the system, and what the situation was with employers. Perhaps he should take a look at the local media at that time about some of the issues under the direction of the Yukon Party, which were raised on a consistent basis, with no progress whatsoever by the members opposite.

Mr. Speaker, I don't hear from all the stakeholders that they need an operational audit. What I heard from talking to them, face to face, was that they wanted a legislative review in the fall of 1999, and that's exactly what we're doing. That's at the call of the owners of the system, not of the Liberal and Tory opposition, which is becoming, more and more, one and the same


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


Speaker: Government bills.


Bill No. 14: Second Reading - previously adjourned

Clerk: Second reading, Bill No. 14, standing in the name of the hon. Mr. McDonald.

Debate was adjourned on February 24, 1999, with no member speaking.

Mr. Livingston: I'm pleased to rise on behalf of the citizens of the riding of Lake Laberge to support the Yukon's 1999-2000 budget - the finest budget tabled in this Legislature to date.

This budget provides support for families, including the youth and the elderly. This budget works with people across the Yukon in developing communities. This budget partners with businesses and with workers, and with practical measures, to create new jobs and new economic activity in the private sector economy. This budget takes action to preserve and protect one of our very important treasures in the Yukon: our environment.

Many Yukoners, including members of the opposition parties, have talked in the recent week - indeed, in recent weeks - about the importance of capital projects, about youth and support for youth, about seniors initiatives, about health care issues, and about the environment.

Well, Mr. Speaker, this budget speaks to these issues in spades. Headlines such as "Budget gets A for effort", "A budget for everyone", "Budget wins approval of business and labour" - those are the kinds of headlines that we've seen this week in Yukon newspapers.

Yet, what do we hear from the two parties opposite? More doom and gloom, almost a death wish. We hear raging rhetoric without much substance at all, Mr. Speaker. The official opposition has demonstrated a great deal of tiresome behaviour. They haven't done their homework. They aren't able to offer constructive suggestions. They aren't able to comment on the substantial issues, so they indulge in petty procedural wrangling. The Yukon Party says the Member for Lake Laberge shouldn't speak about DAP. The Yukon Party says the Member for Lake Laberge shouldn't speak about rural telephones. It's not important today.

Well, Mr. Speaker, the people of the Yukon deserve better than that. The people of the Yukon expect their elected members to deal with the important challenges facing this territory, and that's what we're here to do today.

During this past fall, I had the privilege of working with a number of Yukoners as the chair of the tax reform round table. This is the first time that the Yukon government has ever used the tax system to promote new economic activity, to create new jobs and to address pressing social needs. And I know from speaking with a number of people - from the Chamber of Commerce, from labour, and from the agricultural and mining communities - that they are very pleased to see the recommendations of the tax reform round table, recommendations that they helped to fashion, in this year's budget.

The Yukon small business investment tax credit will provide a non-refundable tax credit of 25 percent on investments in eligible Yukon businesses, up to $200,000 per business. This will encourage contractors, retailers, farmers, and a host of other small businesses to build their businesses or to start new ones.

Up to $1 million of credit a year will be available, and the fact that many investments will also be deemed to be RRSP-eligible means that a portion of the $26 million in savings made by Yukoners annually will remain in the Yukon, to go to work here creating new jobs and new economic activity.

Our government has also committed to enabling legislation this year for an RRSP-eligible labour-sponsored venture capital corporation. This would provide an additional non-refundable tax credit of up to $1,500 per year, over and above the RRSP tax credit, for Yukon investors buying shares. The creation of a venture capital pool will mean new jobs created from new investments and even more small-business start-ups and expansions.

In addition, about $2.5 million in tax credits will encourage exploration activity with the new Yukon mineral exploration tax credit - a 22 percent income tax refund on eligible expenditures on new sites. This is the highest rate found in all of Canada.

But our government has not stopped at tax credits in our efforts to build a stronger economy. We worked with the mining and construction industries, we sat down with workers, and we are working with the tourism industry and many small businesses across this territory to build with them a strong economic foundation for tomorrow.

We're doing this, first of all, by maintaining stable spending patterns with a long-range view so that those industries that look for part of their bread and butter in construction projects can plan accordingly.

Secondly, we are, as the president of the Yukon Chamber of Commerce was quoted in Tuesday's Whitehorse Star, taking some of our rainy-day money and injecting it into the Yukon economy in the form of capital works projects. This can help to sustain parts of our economy, like the construction and service industries, through the current world downturn in mining, and it will help to reduce its negative effects here in the Yukon.

In fact, the Yukon has the highest percentage of capital expenditures of any other jurisdiction in Canada. It ranges between three and five times higher than any of the other provinces in Canada, and this speaks to our commitment to get Yukoners working, both now and in the future.

I want to now turn to the mining industry specifically. As has been mentioned by a number of my colleagues, we not only have the Yukon mineral exploration tax credit, Mr. Speaker, introduced in this year's budget, but we've increased the funding for the geoscience program, and have committed half a million dollars this year to the Yukon mining incentives program.

In addition, we have committed an additional half a million dollars for mineral resource assessments, and, Mr. Speaker, this year will see the first oil and gas leases under the new Yukon Oil and Gas Act - YOGA - that are scheduled for offer this year after consultation has occurred with First Nations and other community interests.

I want to turn to the subject of DAP, because that has been the subject of considerable discussion and, of course, does have an impact on our economic fortunes. But, Mr. Speaker, it's unfortunate that the leader of the opposition just can't get it right. On December 5, 1996, he's quoted in Hansard as saying that most of the work that needs to be done to the development assessment process has been done. Well, I know that neither the mining and development communities, nor the environmental community, nor members of the general public would want to be working with the Yukon Party's DAP - a close carbon copy to today's assessment and permitting regimes. These are the same processes that many people referred to when they talked about what they are looking for and what they expect out of DAP. They want some improvements.

Unlike the Yukon Party government, our government insisted on full public consultation on DAP. We involved people at the beginning of the process and we'll continue to involve them right to the end. We're going to arrive, with Yukoners, at a process that's an improvement over the existing processes, one that's timely and predictable and it's going to be effective and efficient.

Just so that the wide public knows, government projects will also be subjected to the DAP process. Government cannot afford, any more than private developers can, a process that is simply unworkable. We're committed to continuing to work with Yukoners until we get it right.

Our government recognizes that a strong Yukon economy includes mining and, to move on, it's not only about mining, of course. We can't depend solely on mining. To that end, our government has undertaken a number of initiatives to diversify our economy.

In addition to the small business and labour-sponsored venture capital corporation tax credit that I mentioned previously, we also have injected three-quarters of a million dollars into the trade and investment fund to help Yukon business promote and provide new economic opportunities.

As well, a new opportunity that looks outside our borders is the new immigrant investor fund that provides people who are eligible for landed immigrant status in Canada an opportunity to make five-year investments to the tune of a quarter of a million dollars each. I know that, already, our Minister of Economic Development has had some success in promoting that particular program.

Mr. Speaker, there is good news for the construction industry - and that also means good news for the residents of my riding in terms of improved services and increased opportunities - the announcement that we'll be seeing, over the next three years, $14 million spent to build a new 74-bed continuing care facility here in Whitehorse is very good news both for construction workers and for residents in my riding.

We have committed an additional $2 million for new recreational facilities. So we're not working solely for seniors; we're also working for youth and for families. We've committed $4 million, of course, this year to the new swimming pool that the City of Whitehorse is intending to construct. We're providing the majority of the funding for that particular project.

In addition, Mr. Speaker, we will be retrofitting public buildings to conserve on energy, and that will help over the longer haul to ensure we keep affordable and stable energy rates.

We're spending $1 million over two years for Whitehorse waterfront landscaping - just one more project that's going to enhance the quality of life and create new work here in the Yukon.

Mr. Speaker, we also have established - as we work with workers and ensure that they have the opportunities that they deserve here in the Yukon - an additional $1.5 million in training trust funds and that's going to help to ensure that workers have the kinds of skills that they need for tomorrow's economy as we enter this new millennium.

I'm also pleased to note, Mr. Speaker, that the improved contract regulations and the changes to the business incentive program that came out of the Yukon hire commission and that whole initiative are clearly paying off. The total value of all Yukon government contracts going to Yukon businesses rose from 59 percent in 1995-96 to 89 percent this year. That's a significant improvement, Mr. Speaker, in terms of Yukon government money staying in the Yukon with Yukon workers, and I'm very proud of that particular initiative.

Mr. Speaker, we also recognize that tourism is one of the cornerstones in our new economy and, to that end, we have injected three-quarters of a million dollars into the tourism marketing fund for this coming year to support the ideas and activities that will help Yukon tourism operators. I know I've spoken to tourism operators in my riding who are very pleased to see this opportunity and are looking for ways of making use of some of these resources to further the whole industry and their particular activities as well.

There will be an additional $200,000, as well, in tourism marketing to build our successful marketing efforts, not only in Europe but also in Canada and the United States.

Mr. Speaker, the second half of our commitment to extend the Whitehorse Airport, the $3.5 million commitment, once again, is going to be good for construction workers and it's going to be good for tourism and for all the people who rely on the economy here in Whitehorse.

This, of course, is going to provide, once the work is completed, the opportunity for direct flights to take place between here and Europe, here and Asia, and elsewhere.

Mr. Speaker, the budget has been far ranging and visionary, I believe. We've looked not only at tourism. We've looked not only at the construction industry. We've looked not only at mining, but we're increasing our commitment to the Yukon film location incentive fund to the tune of $175,000. I know that at least one establishment this past year had more than 200 nights at their particular hotel because of this particular program. So this is an injection, in fact, into this economy, and each one of those dollars makes its way through our economy.

Our commitment to the environment around the Yukon protected areas strategy, resource assessments and park systems planning, the historic site maintenance, museums and exhibits - a new $500,000 to museums and exhibits - also, of course, is support for the tourism industry, as well as support for the cultural activities here at home. It's encouragement for those people who are involved in heritage activities, people who are involved in other cultural activities - an additional $500,000 in historic sites maintenance. This is all good news, Mr. Speaker, for Yukon workers and for Yukoners generally.

As part of our partnership with business, we're looking, as well, at other ways of diversifying, including $75,000 to set up a Yukon innovation centre, in partnership with Yukon College and Yukon businesses - really a first step, I believe, having a greater focus on research and development, and also an opportunity for us to further develop technologies that fit our climate and our locale here in the Yukon.

It's also an opportunity, and I believe it will be an opportunity. It's setting the stage for tomorrow for us to showcase what we've done here and what has worked here with a relatively small population, a vast land, and the kinds of things that we're able to do here, and there are other parts of the globe that look to us here and the kinds of things that have occurred here. We've seen that in some of the trade and export initiatives that have been taken over the last year.

In addition, a $200,000 technology innovation fund that will be administered by the Northern Research Institute will support research on innovative approaches to using information technology.

Mr. Speaker, our government is also committed to making it easier to do business. I talked about DAP a little bit earlier. We want that to be a clear, predictable process.

We've also made a commitment to reducing red tape that exists here in the Yukon. And we know that, partly because of our history here, we have a federal government that sometimes operates in a bit of a colonial manner. That may be a bit of an understatement. We've got the territorial government; we've got municipal governments, and we've had no shortage of red tape here in the Yukon. So, our government's commitment to reducing red tape, I believe, is a significant commitment that will help to make it easier to do business here in the Yukon.

The trade and investment diversification strategy has helped several Yukon businesses make contact with potential clients in Alaska, in South America, in Russia, in Chile and elsewhere.

Mr. Speaker, our commitment to a strong economy is about supporting Yukon workers, Yukon businesses, but most importantly, Mr. Speaker, about supporting Yukon families. It provides that strong foundation that enables us to do all of the other kinds of things that we want to do.

Our government is demonstrating in this budget a strong commitment to Yukon families and to Yukon communities. We recognize the importance that families place on long-term security and on well-being.

Our government continues its commitment to one of the highest levels of public health care in this country - health care available when Yukoners need it, not just when they can afford to pay.

Our government also recognizes there are too many families facing hardship because of low incomes.

This includes parents in these families, who may have lost work, who require more training, or who have a reduced capacity to work for any number of reasons.

But it also includes the children from these families - the young people trying to get a start in life, and the reduced opportunities that result from being in a low-income family. To that end, the $500,000 for a new, low-income family tax credit - or LIFT - will provide families on lower incomes with a maximum benefit of $300. In addition, Mr. Speaker, the $500,000 for a Yukon child benefit is aimed at families with children, where the net family income is less than $22,000 a year. The maximum benefit will start at $300 for the first child, with benefits for each additional child as well.

Also through the tax system, Mr. Speaker, we have a new seniors' property tax deferral that will allow seniors living in their own homes outside of municipalities to choose to defer paying property tax until the home changes hands. This is just one more measure that can relieve the tax burden on families, and potentially families who don't have a high income.

Our commitment, Mr. Speaker, to Yukon families and communities does not end there. In addition to the continuing care facility that I spoke about earlier, and the recreation centres - the swimming pool that I spoke about earlier, the construction projects - our government has also made a commitment to open the seven remaining beds at the Thomson Centre. That will cost our government $645,000.

We've made a commitment to spend $200,000 on professional development for health workers, which complements our new bursary program, aimed at encouraging young people to consider nursing as a career.

We also have invested roughly a quarter of a million dollars in the healthy family initiative, which supports public health work with families to promote health issues.

We've also invested $200,000 in new funds in the Child Development Centre for rural outreach, and programs that address the special needs of children with fetal alcohol syndrome. Mr. Speaker, I know that this is a matter that's important to many people, and I'm proud that our government has proceeded and done some good work in this area.

We've also committed an extra $200,000 to alcohol and drug treatment centres, bringing the total to $300,000 in this coming fiscal year.

Mr. Speaker, it doesn't end there. The list goes on and on. We're spending $140,000 to develop hospital-to-home service linkages for patients who need medical or social support after being discharged from hospital. This supplements the home care work that is already being done as a result of previous budgets that our government has brought down. There is $108,000 for outpatient day programming at the Thomson Centre, and an additional $98,000 goes toward support programs for people with diabetes.

Mr. Speaker, our government has committed $200,000 for youth recreation programming. Our government support for families and for the communities that we live in is clearly demonstrated in this budget, and I'm proud to be a part of the government that is bringing this budget forward.

I want to speak now for a couple of minutes about a number of the communities within my own riding. To the great number of residents north of Whitehorse who have expressed concerns about inadequate fire protection, there is money set aside in this budget to begin the training of local volunteers and the planning of a local fire hall. Once again, this expenditure will support local initiatives in this regard, and for smaller communities for which a fire hall is not feasible at this time, I have received the commitment from the Minister of Economic Development that any applications to develop more fire safe communities will be actively considered by the community development fund.

It gives me a great deal of pleasure to congratulate the new Deep Creek Local Advisory Council on its recent formation. I am pleased with the constructive working partnership that has developed between the community and the Community and Transportation Services department over the past two years. Both partners are to be congratulated on this effective partnership. I attended the founding meeting of their new council last night, and I know that this new council, representative of a variety of interests and locations throughout the community, will serve their residents well in the future.

The residents of the Hot Springs Road have embarked on a community-led planning process as well - a process that can provide the larger community with greater influence as well as a unified voice in matters that affect them. I've supported this initiative because it is one clear way to involve local citizens in planning decisions and it will ensure they will not be left in the back seat on decisions that affect them.

I'm also pleased to indicate to the residents of the Hot Springs Road area the commitment of the Minister of Community and Transportation Services to support local residents in their planning endeavours throughout the coming fiscal year.

Mr. Speaker, I'm also pleased to note, in this year's budget, that there is money set aside for driver training. This is a program that I have advocated for some time - driver training within our public schools. I think it's important that we reach more young people with the important skills training and the safe-driving education that takes place in those kinds of forums. It also, I believe, can make for safer roads - safer roads for all Yukoners. I would simply urge, at this time, the potential partners in this particular project to work together for what I believe is a common goal of ensuring that we have young people in our territory who have the best skills for the roads, for their own safety and for the safety of all Yukoners.

Mr. Speaker, I'm pleased that our government is moving in this direction.

We have, of course, a number of programs that have been in place over the last two years that support families as well - programs like the community development fund. As members of this Legislature will know, I've often made reference to the many programs that have been funded, programs that have been initiated, by a variety of groups and organizations, by sports groups, by recreation groups, by community associations. These are groups that I believe have their pulse on their own neighbourhoods and the communities that they represent, and for projects that I believe improve the quality of life for all of us here in the Yukon.

So, I'm pleased once again to see $3 million committed to the community development fund for the coming year, and I would certainly look forward to any queries from residents and from constituents who may have an interest in pursuing applications for that particular fund.

One other program, Mr. Speaker, that has a particular impact on my riding is the rural roads programming, and I'm pleased to see that our government has seen fit to double the funds available for the rural roads programming in the 1999-2000 year to $1 million. It's going to improve rural transportation infrastructure, I know, across my riding and provide for community contractors and workers to bid and to go to work on those jobs. This a good contribution to, once again, quality of life, particularly in rural areas.

Mr. Speaker, I've talked about the economy; I've talked about families and I've talked about the community. There is one other area, one final area that I want to talk about today that has been addressed in a significant way in our budget and that is about our government's commitment to protecting and preserving the environment in the Yukon in partnership with all Yukoners.

Mr. Speaker, over the last two years, we've gone through a clearly defined public process to arrive at a protected areas strategy. This is a process, this is a strategy that is going to lead us well into the next millennium. It's going to set aside important areas in 23 ecoregions across this territory at various levels of protection for future generations. It's going to be part of our legacy for tomorrow's children.

We have already committed, of course, to the Tombstone park and that's one of the parks that I hope that we'll see a great deal of work done over the next year. Local planning teams have been selected and are going to work on that now. In addition, two other final agreement SMAs, the Tatshenshini heritage river and the Fishing Branch ecological reserve are all areas that will receive attention during the coming year.

In addition, $2.3 million in ongoing O&M funding has been identified for the Yukon protected areas strategy and nearly $1.4 million over three years for resource assessments and park systems planning so that we make sure that we go about this process in an open and a consultative way and that we do it right.

Part of the half million dollars set aside for the mineral resource assessments will support the efforts in the protected areas strategy.

In addition, Mr. Speaker, our commitment to the environment is demonstrated through our additional funding for retrofitting public buildings, for district heating, facility studies, for waste heat projects that will use waste heat from energy-producing facilities, for the commercial-scale wind turbine on Haeckel Hill, which will see $2 million spent on it and will be operating by this fall, by the green power fund that was established last fall with the contribution of $3 million to the Yukon Development Corporation. It's also demonstrated through the $1 million for energy efficiency programs that we've contributed to.

Some new initiatives that we've undertaken this year - the Yukon climate exchange, which sees $50,000 for community environmental groups to study the impact of climate change on our northern environment, and gives us a heads-up so we know where we're going into the future and what we're facing here; our commitment to extend lobbying efforts to protect the critical calving habitat of the Porcupine caribou herd; and our commitment to arrive at a workable DAP as well.

We also see $150,000 in a training trust fund with the Yukon Conservation Society. Finally, the devolution announcement that we had just last week means that we will be in control of our own forests, our mineral resources and our water. We'll be responsible for the stewardship of our land and for working with all of the partners in our Yukon economy to build a sustainable and vibrant economy.

So, Mr. Speaker, I'm pleased to have had the opportunity today to speak for this budget that supports families, that works with communities in developing communities, that nurtures the Yukon economy in a practical and respectful way and in partnership with the various players, and a budget the preserves and protects the Yukon environment.

Mr. Speaker, I think we have a winning budget here, and I would look forward to seeing all members in this House support a budget that is going to be good for Yukoners this year and for many years to come.

Thank you, Mr. Speaker.

Hon. Mr. Fairclough: Mr. Speaker, I'm pleased to rise to speak in support of this budget. I believe this budget reflects the priorities that Yukon people have expressed to this government. As a rural MLA, I'm especially pleased because there is a lot in this budget for business, for the resource sector, and for the environment. It is also a budget for communities.

Our government knows that the best way to build a strong economy is to work in partnership with other Yukoners. Our cooperative work to build a diverse economy will help us through the ups and downs of the mining industry. At the same time, our government knows that healthy communities and the care of our lands and resources are essential to a strong Yukon economy. This budget recognizes the importance of balance.

In difficult economic times, rural Yukon is often the hardest hit, and, for this reason, First Nations, municipalities, and individuals are working to diversify local economies. Several of my constituents from the Mayo-Tatchun riding have asked me about our government's support for these efforts, and I'm happy to be able to tell them, "Yes, we do want to help," and refer them to our government's training and investment fund. The 1999-2000 budget contains $750,000 to assist Yukon people to pursue new business opportunities.

Our Minister of Tourism and his department are doing a great job of attracting more and more visitors to the territory. Their hard work means increased opportunities for economic diversification in rural Yukon. When a constituent approaches me and asks how she can attract more tourists to her business, I can tell her about the tourism marketing fund, which also contains $750,000 in this year's budget.

This fund will go a long way to help out small and large tourism operations.

Mr. Speaker, residents and visitors alike will benefit from the 100-percent increase to our government's rural roads program, bringing the total amount of the funds available to $1 million. This will not only help improve roads around communities, but also provide some much-needed work in the communities. Our government has chipsealed the first 15 kilometres of the Robert Campbell Highway just north of Carmacks, and I have received a lot of positive feedback from my constituents. This budget identifies $1 million for work on the Robert Campbell Highway at Grew Creek between Faro and Ross River. In addition to this, $2 million over the next two years has been set aside for further work on this highway. The $19 million for the Shakwak project on the north Alaska Highway will provide many jobs, thanks to the good negotiations of this government, Mr. Speaker. This budget also identifies $600,000 to replace the Willow Creek bridge on the north Klondike Highway near Pelly Crossing.

The community of Mayo has needed a new school for some time, and our government will ensure that construction will take place within this mandate. We have budgeted $7.3 million over the next three years. Last year, the community received $100,000 to begin planning, and this year, they will receive an additional $100,000 to complete the design, and construction is expected to begin next year.

The Yukon Housing Corporation will also be doing some work on some housing units in several rural communities. Some of these renovations will be done on staff housing units in Mayo, Pelly and Carmacks.

Rural Yukoners have really benefited from the community development fund, and the communities of the Mayo-Tatchun riding are no exceptions. The CDF has funded a lot of important projects, such as the Keno City artifact shelters, the Nacho Nyak Dun community playground and the Village of Mayo's improvement to the swimming pool facility.

Selkirk First Nation used CDF dollars to plan renovations for its administration building and also for completion work to the curling rink for artificial ice. These renovations included large additions and will be assisted by the CDF dollars.

Little Salmon-Carmacks First Nation has run a very successful cooking program with assistance of the CDF dollars. They've had much interest in this - a six-week course - that not only Carmacks people took advantage of, but the people in Carcross also, who came to Carmacks to take this course.

The Village of Carmacks will be exploring a feasibility study on a new community centre. We've also had CDF dollars go toward a youth centre and a daycare and the completion of the heritage hall in Carmacks. These are just a few of the projects that come to mind.

Mr. Speaker, the fire smart communities program - which is part of the CDF - has also been very successful, and provided jobs to people in the communities of Mayo-Tatchun, especially through these winter months. The 1999-2000 budget contains $3 million for the community development fund, including the $500,000 for the fire smart communities program.

People in my riding are working hard to identify local priorities, and I'm glad to see the important projects completed with the assistance of the CDF. These projects will help not only to build a community, but provide some jobs as well.

And, with the $500,000 to the communities, Pelly, Carmacks and Mayo have accessed these dollars and have been working on the first phase of the firebreaks around their communities.

Communities will also be excited about the $900,000 over two years that has been set aside for the millennium fund. This fund will be used to support creative projects and events throughout the territory to mark the new millennium.

In addition to this, municipalities will see the first increase in municipal block funding since 1991 in this budget. They will also enjoy the new authority to balance their own capital and operational spending.

As I mentioned, Mr. Speaker, strong, healthy communities are important to a strong economy. Yukoners have told our government that they do not want cutbacks in priority areas such as health care and education, and we are improving the services in these areas and meeting the growing and changing needs of Yukon people.

Our government plans to hold a Yukon health summit to hear more about Yukoners' needs for our health care system. The circumstances of rural Yukoners are much different from those who live in Whitehorse and most other jurisdictions throughout the country. This summit will provide a forum for discussion on how our government can further improve the health care services for rural Yukoners and others. The Minister of Health has made some significant additions to the 1999-2000 budget, based on what he has heard so far from Yukon people.

Our government will build a new continuing care facility for seniors and other Yukon residents and open the seven remaining beds at the Thomson Centre. Nursing stations in several Yukon communities, including Mayo and Carmacks, will receive some improvements.

In this budget, the healthy family initiative will receive an additional $228,000, and an extra $200,000 will go toward community alcohol and drug treatment centres. This will be good news for people in Champagne-Aishihik and the people of the Northern Tutchone territory who have working alcohol treatment centres in their territory.

Our government has also identified $140,000 for patients who need extra support for leaving the hospital, and an additional $98,000 will go toward support programs for people with diabetes, which is especially common among First Nations.

Several constituents have spoken to me about how difficult it can be to make ends meet in rural Yukon, and our government's new anti-poverty initiatives will provide support for Yukoners who are struggling financially. The low-income family tax credit will provide a benefit of up to $300 a year to people with a net income of under $25,000 a year.

We are also setting aside $500,000 a year for the Yukon child benefit, to help out families with children where the net family income is less than $22,000 a year. These funds will provide direct support for about 1,100 families and 2,000 children across the territory. As well, these monies will not be considered as income in calculating social assistance payments. This is the kind of support and assistance that Yukoners have been asking for.

Mr. Speaker, I have enjoyed growing up in a small community, and I appreciate the opportunities that were available to me but, from my own experience, and from what constituents tell me, more needs to be done to support our youth and to help them grow.

My colleague, the Minister of Education, has been putting a lot of energy into supporting our youth, and I'm proud that she has set up the youth investment fund and invited young people to sit on several government boards and committees. She is also establishing a youth advisory board, and continues to support important events and programs for youth, such as the recent conference in Whitehorse, which many rural young people attended.

The 1999-2000 budget contains an additional $200,000 for a youth recreation program, bringing the total to $400,000. I'm sure that these funds will be put to good use.

Training is another need that our government continues to address. Many Yukon communities, including the community of Carmacks, have benefited from this fund. Our government has decided to provide an additional $1.5 million for the training trust fund in the 1999-2000 budget. Our government sees the availability of training opportunities as important for an individual's personal benefit and as an investment for the future. As First Nations work to implement land claims, the territory prepares to take over responsibility of its lands and resources, and the people throughout the Yukon are working to diversify their local economies, training trust funds will help us enhance our economic prosperity.

Yukon Housing will continue to offer affordable housing options for Yukon residents. The corporation's program for home ownership, and upgrading and energy efficiency, is proving increasingly popular with the consumer. Yukon Housing Corporation has assisted 447 clients in 1998-99, an increase of 43 percent compared to 1997-98. Indicators are that this is a continuing trend, and applications are up about 11 percent compared to this time last year.

The housing sector is an important part of the economy of Yukon. Yukon Housing Corporation is working with the housing industry to enhance its contribution to the economy. In addition to the economic benefits of a stronger housing industry, it will benefit all Yukon residents through more affordable housing options.

The Yukon Housing Corporation has issued a request for proposals for the development of a housing project suitable for export. Six energy-efficient houses will be built using technology that lends itself to export. These prototype houses will be used to provide affordable housing for Yukon residents.

The experience that the local industry gains in building these innovative types of housing will put it in a good position to capitalize on the future opportunities in the rural market for housing and housing technologies.

The Yukon Housing Corporation will also play a large role in meeting the increasing needs of our aging population. Some of this role is outlined in the draft strategy, Growing Older in the Yukon, which was tabled on Wednesday.

The corporation is presently undertaking a seniors housing needs study, which will enable all sectors - public, private and non-profit - to plan and develop housing solutions to meet the current and future needs.

To gather information for this needs study, the corporation has surveyed a representative sample of seniors and near-seniors in the Whitehorse area. That information will be combined with the information from the community housing studies being conducted in rural communities and existing information sources to provide a complete picture of current needs and trends. The corporation will then work with senior organizations and other stakeholders, including industry and non-profit associations, to develop programs and other solutions.

The Yukon Housing Corporation will be playing a key role in helping this government meet its commitments to implement the recommendations of the energy commission. Energy conservation and the reduction of greenhouse gases is a priority of this government. Acting on that priority will result in large economic and environmental benefits.

Mr. Speaker, $2.3 million in ongoing O&M funding for the implementation of the Yukon protected areas strategy, as the Government Leader has said in his budget address, is the cornerstone of our environmental agenda. It will be our tool to conserve biological diversity, maintain our functioning ecosystems and preserve areas of special nature and cultural significance.

In 1999-2000, we will build on the goodwill and partnership fostered through the strategy's development and move to the implementation phase. The budget allotments will permit us to fulfill the commitments we made to on-the-ground programs in terms of designated protected areas. This is a goal we all share, that of certainty for the environment and for industry.

We have established the protected areas secretariat to coordinate the planning and establishment of protected areas and have already started the process to establish local planning teams in three areas. As has been mentioned a few times, it is the British Richardson Mountains in the Eagle Plains ecoregion in north Yukon, the North Ogilvie Mountains - which includes the Fishing Branch - and the Southern Lakes and Pelly Mountain ecoregions in southern Yukon.

We are establishing local planning teams in each of these areas, and our current goal is formal designation of two of the three new representative areas by spring of 2000. This spring, we expect to complete designation of the Fishing Branch ecological reserve, which is a special management area under the Vuntut Gwitchin final agreement, and by the fall of 1999, we expect to finalize the designation of two other final agreement special management areas, the Tatshenshini heritage river - the pronunciation is different from what is written down here, but I use what the Tlingits have told me - and the Tombstone territorial park, which has been discussed a lot in this House and in the general public.

As well as protecting important elements of the Yukon's ecosystems, the lands designated under the protected areas strategy have the potential to make a major contribution to the economy in the areas of tourism and recreation.

We are committed to implementing this strategy. We have support from industry, the environmental community, First Nations, municipalities, and a broad support from Yukoners in general. I am proud of what we have accomplished, and I look forward to carrying this through with this government's commitment to protected areas in the Yukon.

The budget includes a number of projects related to climate change and the need to educate people about the effects of greenhouse gas emission. This includes the development of educational material for Yukon schools, a greenhouse gas inventory project, and a transportation study of Yukon government employees.

We continue to work with the Yukon College and the federal government toward the establishment of the northern climate exchange. The goals of this information and research centre are to establish a coordination point in the north for climate change research activities, advance circumpolar climate change research, facilitate in the exchange of climate change knowledge and technology and expertise, and facilitate in the collection and assessment of both scientific and traditional knowledge.

Mr. Speaker, our government has consistently opposed oil and gas development in the critical calving habitat of the Porcupine caribou. This herd is essential to the lifestyle of the Vuntut Gwitchin people on both sides of the Yukon and Alaska border. The protection of the critical calving grounds of the Porcupine caribou herd is important to this government, and we have allocated $100,000 in the department's capital budget to support public information and lobbying efforts on behalf of the herd. This government is committed to the permanent protection of the calving grounds, and this money will bolster the good work that is continuing on this front.

Our ongoing commitment to the environment can also be seen in how we are implementing the 56 recommendations of the Cabinet Commission on Energy.

Mr. Speaker, there's a lot in this budget that I haven't mentioned. It was hard work putting this budget together, but it was well worth it. Yukoners have told us what they need, and this budget reflects our commitment to meeting those needs.

We recognize the importance of healthy communities, taking care of our lands and resources, and job opportunities for Yukon. Through our balanced and responsible approach to managing the Yukon's economy, we are addressing the concerns of the present, and preparing to meet the challenges of the future.

Thank you, Mr. Speaker.

Hon. Mr. McDonald: I will keep my remarks somewhat brief today.

I'd like to thank the members who have spoken. All members of the Legislature on both sides of the House have expressed their opinions on the budget that we have presented in the last week. It's a budget, of course, that has been the subject of a great deal of hard work on the part of many people. It is a budget that has seen the contributions of hundreds of Yukoners realized in black and white, in budgetary terms, on the floor of this House.

Mr. Speaker, this budget is very much a balance of complementary and competing interests in this territory, recognizing that there are many aspirations, there are many needs, that are legitimate and that should be addressed.

There are many requests that are made, Mr. Speaker, that of course cannot be realized. That is always the case when one has to make choices, but I believe that the budget itself, and the work that has gone into developing it, will demonstrate that the broad community interest - the real character of the territory - is reflected in these pages.

Of course, Mr. Speaker, budget policy, budget development, the ongoing operations of government and our community, don't end with a single budget. Many good ideas come forward, and I believe that any government, any Legislature, should accept and embrace any good idea, whenever it comes, and from whomever it comes.

Mr. Speaker, in the coming weeks, the representatives from the business summit, for example, will be coming forward to make recommendations on what the government can do as a contributor to our economic prosperity - what the government can do to boost our economic fortunes and help bring prosperity to the territory. That process, the process of receiving those recommendations will, of course, be embraced by our government, and we will continue to work, not only with the business summit, the chambers of commerce - with whom we've had a close relationship over the course of the last 18 months - the labour community, unions, the environmental community, the development community, the mining community and the oil and gas community. We will continue the dialogue, to ensure that their legitimate interests are expressed in the budgets.

Mr. Speaker, it is often easy for the critics to embrace those opinions of the extreme elements in our community. It is incumbent upon those of us who have a clear sense of direction and a sense of balance to keep our discipline - to respectfully receive the advice from the extremists, but to follow the direction that we know to be right, to follow the direction that the vast majority of the people in the territory are telling us is right, to hold course and progress.

Mr. Speaker, the opposition members in the Legislature have my sympathy. They must be in agony. Whatever criticism or comment they make about this budget, they are continually contradicted by citizens - both on the street, in the newspapers and in the media, through all forms of communication to our government. There is no organization that I know of that has embraced or endorsed the opinions held by either the Yukon Party members or the Liberals.

Mr. Speaker, this budget is widely supported by the people of the territory and that is no accident. That is the result of careful planning. That is the result of respectful listening. That is the result of joint action between the citizens and their government.

Hence, when the citizens of the territory tell us, through whatever medium, that they appreciate and they like various elements of the budget, it is often because they have recommended those self-same actions be taken by the government. They've expressed to me dismay at the opposition's reaction to their own ideas, criticizing their own ideas as lacking substance, being wishy-washy. They express concern that the opposition has not listened to their interests or reflected any notion of any kind of balance of interests in this Legislature.

Now, Mr. Speaker, in recent history, the Member for Riverside, with whom I've had more than a passing good relationship, has expressed and reported, for the Liberal Party, their position on a variety of government budgets, both Yukon Party and New Democrat budgets. Only a couple of years ago, the Member for Riverside was voting for the Yukon Party budgets on a regular basis, whether the budgets themselves contained wage cuts for public servants. All the while, the gross spending was reaching record levels, whether the Yukon Party budgets contained record tax increases in the face of a flagging economy - and one year a drop of the GDP in this territory was 17 percent - the Member for Riverside consistently kept faith with the Yukon Party and voted with the Yukon Party budgets.

Now, he said, Mr. Speaker - and he went on at great length at the time - that he wasn't giving the Yukon Party a vote of confidence; he was merely voting for what was good, what was patently good.

Now, Mr. Speaker, we did take issue with those Yukon Party budgets, as did many citizens, and suggested that the balance wasn't struck and interests weren't met. They had not captured the broad support of this territory.

Nevertheless, the Liberal member kept faith with the Yukon Party. That is a record that the Liberals in this Legislature have continued with the Yukon Party opposition.

Mr. Speaker, I've wondered at this situation for a long time. Why would someone who calls themselves a Liberal vote consistently with the Yukon Party, which bears every characteristic of the Reform Party? Why would they consistently, when the essential moments come forward in this Legislature, when the time comes when one has to stand and be counted, why would the Liberals choose to support Yukon Party actions?

Well, I've had to come to the conclusion, Mr. Speaker, that we have to look beyond the names of the various parties. We have to understand and accept that, essentially, the Yukon Party and the Liberal Party are identical parties. They stand for the same things. There is no secret now why one understands this equation. There is no secret now why the Liberals would support the Yukon Party while they are in government and support the Yukon Party while they are in opposition.

Now, Mr. Speaker, the Member for Riverside did not criticize this particular budget. He resorted to something that he has always resisted, frankly. He admonished all who are listening that this is a budget that's being promoted by a government that has sister parties elsewhere, some of whom have gotten into trouble with their electorate.

Mr. Speaker, he did not criticize all NDP governments; he criticized two. Most importantly, he didn't criticize the Saskatchewan NDP government, and he actually did not criticize the Yukon NDP government. He did not criticize the budget. He identified a number of obviously good things in the budget.

Mr. Speaker, what is that member going to do today? This is a budget that has received widespread support from the community - whether one comes from the business community, resource sector, labour, the environmental community, seniors, the Anti-Poverty Coalition, or municipal government, one sees support for the budget.

The question is, will the Liberal Party break faith with the Yukon Party, or with the citizens of the territory? Will they support what the citizens of the territory believe to be a good budget, or will they support their brethren - the Yukon Party?

I predict, Mr. Speaker, that they will do as they always have - they will not break faith with the Yukon Party, because they are the Yukon Party.

Mr. Speaker, the leader of the Liberal Party began her remarks once again by acknowledging that we are anticipating an annual deficit at the beginning of this year.

This she says by way of criticism. Her leader, the Member for Porter Creek North, has already criticized the government for not spending enough of the surplus, for not running a larger annual deficit, but yet she, once again, takes the view, or is of the view, that the fact that the government is intending to spend some of its savings account this year to get us through some difficult times is, inherently, a bad thing.

By logical extension, one could only assume that one should never spend away a savings account because to project any expenditure from that account would amount to a projected deficit. If that is that member's understanding, Mr. Speaker, the apprenticeship in this Legislature will be very long.

The Liberal leader went on to dismiss the trade and investment strategy and many other initiatives of the government as being hype and no action. Mr. Speaker, I continually have meetings with our partners in trade and investment, a partnership which is getting broader, wider and deeper as the months go on. There are more and more partners entering the partnership and asking to be part of the partnership, month after month.

I spoke to business people just in the last couple of days who are enthusiastically speaking about the new export economy in which they were hoping to participate in and that they were, in fact, participating in.

I don't understand the member opposite. I don't understand why an initiative that would have such broad support in the business community and would see the government and the people of the territory diversify the economy beyond levels that it's ever known before, I don't see why that initiative, freely and openly given by citizens themselves, at their own expense, would be criticized and dismissed by that member.

Mr. Speaker, for years, people have spoken in this territory about the need to, not only build on the resource sector, but to diversify into other sectors. And there are business people in this territory who are valiantly trying to do just that, and yet it is dismissed as insignificant by an elected person in this territory - a person who is clearly cutting all connections that they once ever had with the people who voted for them.

Mr. Speaker, as I mentioned at the Chamber of Commerce luncheon yesterday, while I don't often quote an acquaintance of mine, the Premier of Alberta, I will just relate to you that he has given me some advice, which I found very valuable. When I was commiserating with him over the lower and lower price of oil and what it must mean for government revenues and the ensuing controversy he might have to face, he smiled and said, "Back in the early 1980s when the national energy program caused a decline in oil and gas activity and a decline in government revenues, they faced a significant problem."

The business community, the government and others worked hard to diversify their economy. They weren't ashamed of an export economy. They weren't ashamed that they could sell the resources and knowledge, know-how outside the borders of Alberta. They in fact embraced it and have, consequently to this day, become major participants in Team Canada missions wherever those missions are undertaken throughout the world. They are not selling just oil and gas, wheat, grains, hogs and beef. They have diversified beyond the agricultural and the oil and gas sector into high tech, into secondary processing of forest products, into tourism, in ways that could never have been imagined even 15 years ago, and consequently, when there is a dip in one sector, the economy does not face the same boom-bust cycle that is so typical of resource economies.

So, here we have a situation in this territory where the citizens are standing and doing some courageous things, things that they've never done before, daring things, risky things - their efforts are dismissed by the Liberals.

Mr. Speaker, the Liberal leader went on to speak about the government's planning process and said, in her own precious way, that the long-term plans of the government were mortgaging our future. Those are the words she used - "mortgaging our future." The fact that the government actually stepped forward and announced that it had longer term plans - plans, incidentally that the government has always had. In all the time that I've been in this territory, there have always been capital plans. It's just that they had never been made public. It's a fact that the government has announced that the government has plans and that it is showing how it intends to commit capital dollars after consultation with the public, how it's balancing priorities over the long term, how it's spacing these capital works, how it's going to address the O&M implication of those capital works. When the government does that, that is ostensibly decent planning, reasonable planning.

The Liberal leader has called this "mortgaging our future". Why? Because she has mistakenly believed that this commits the government or the Legislature to an expenditure beyond the 1999-2000 estimates. She, of course, is wrong, but the option that she has been proposing for some years is that the government should engage in what she refers to as public/private partnerships, which involve, invariably, in all the suggestions that she has made so far, the government borrowing money and then paying it back. Well, Mr. Speaker, that is mortgaging our children's future; that is debt financing, by another name; that is creating obligations today that must be paid off by a future generation. And I contend with you, Mr. Speaker, that this generation of Yukoners should live by the decisions they make today. They should be bequeathing to future generations assets, not liabilities.

While there are some good public/private partnerships that have a good commercial ring to them, a good commercial element to them, the proposals that so far have been put forward by the Liberal member would condemn us to the same debt cycle that plagues virtually every other government in this country. That is one member this government will not follow into the next century. That is one suggestion we could not, in all conscience, support. That route, Mr. Speaker, is irresponsible.

Mr. Speaker, many members in the Yukon Liberal Party - the Yukon Party Liberal Party, the Liberal Yukon Party - many members in the party across the floor wove a tangled web of confusion when it came to trying to describe the government's long-term planning process.

Only last year, they were saying, "When are you - the NDP government - going to live up to your commitments to do some long-term planning, not just on the operations and capital side, in very general terms, but in terms of the specific capital works? When are you going to show us what your long-term plans are?"

On behalf of the government, I indicated we were going to show them this year, in the context of this budget. When the plans came forward, members opposite - as I just mentioned, the Liberal leader, or the Liberal leader, follower of the Yukon Party - referred to that as mortgaging our future.

The official leader of the Liberal Yukon Party suggested that we were making illegal and immoral commitments. Another member of the same party said that, "It's all smoke and mirrors, there's nothing firm, it's total fiction."

So we were making commitments that were immoral, it was all fiction, and we were mortgaging our children's future, all because we were doing some legitimate planning - planning that they themselves asked us to do, only last year.

Now, the official leader of the Liberal Yukon Party made the comment that we were setting a precedent of making commitments of this Legislature beyond the year 2000 - commitments that we couldn't keep.

Well, Mr. Speaker, governments always plan at least a year ahead. I would argue, if anybody should be planning more than a year ahead, it should be the government. We cannot all live for today. If one wants to build an extended care facility, one has to understand that that can only be constructed over a number of years.

One has to plan for it, one has to construct it. This takes time. Now, one would think, Mr. Speaker, that the Yukon Party made no long-term plans in 1996 that might form some sort of obligation to another government coming in, should the Yukon Party not be elected. Well, lo and behold, the Yukon Party was not re-elected and another government did come in and, lo and behold, there were commitments, lots of them, lots of big-ticket commitments, that the NDP chose to support, chose to honour because there was a public expectation that they would proceed.

When the South Access Road was being built, Mr. Speaker, it was initiated by the Yukon Party in cooperation with the City of Whitehorse. The majority of the expenditures were actually undertaken during the NDP government period. That money could have been put into other things but, no, the NDP government honoured that commitment to citizens of this territory and went through with the project, of course.

The road to the Viceroy mine was another example. The grade reorganization commitment, with its attending capital and operations consequences, is still being paid for in this budget.

Mr. Speaker, good planning makes good sense. Good planning that shows the pacing of projects, the affordability of projects and the priorities of the planners makes good sense.

Now, Mr. Speaker, another theme of the opposition was that the NDP Government Leader - "Piers McDonald is building an election war chest on the backs of unemployed Yukoners." Now, the members of the party are going to have to get together because the official leader of the Yukon Liberal Party is saying that we should spend more now - fast. Never mind tomorrow. This is a rainy day that may last more than one year. Spend it now, as quickly as we can, and never mind the consequences of future years.

That's what one member of the Yukon Liberal Party is suggesting. Other members are suggesting that any expenditure beyond the revenue that one takes in in a given year is, by definition, a deficit and, by definition, bad - a fairly facile analysis.

What the official leader of the Yukon Liberal Party is saying - the Liberal Yukon Party, rather; we'll just call them the Reform Party - is that we should be spending more now to meet the needs of today, irrespective of whether or not it can be spent, and irrespective of any consideration of the future. They're suggesting that this will somehow make a substantial difference to the economy of this territory.

Well, let me state the obvious, Mr. Speaker. If we were to spend the entire savings account of the government - draw the reserves right down to nothing - we would only be making a small dent in meeting the historic needs of this territory. If members opposite believe that we can replace the $200 million that the Anvil Range mine was putting in to this economy alone - from the one mine - by spending our entire savings account, I would call that nonsense. If they want us to spend now and ignore next year; open Thomson Centre beds now, close them next year, build everything now, nobody works next year - from historic government spending - I'd call that irresponsible.

Mr. Speaker, that is, though, completely consistent with the actions taken by the Yukon Party while they were in government.

One month the Yukon Party government was declaring a crisis, taxing people when they were down, and six months later they were declaring a surplus. The all-clear signal went out, they spent $7 million on a brand-new program that nobody had ever heard of, except their blue-ribbon committee, and only the next year, they were declaring a crisis again, crisis enough to justify the autocratic cutting of public servants' wages, ignoring collective agreements and passing laws legislating rights out of existence. So, their boom-bust government spending process - this move from munificence to deprivation, over and over again, year after year - is a part of what the Yukon Party stands for. It is the Yukon Party's way of doing business. So, it's probably consistent - it certainly seems consistent - with their admonitions to the government today to do exactly the same. You've got a savings account; forget tomorrow; spend it all today.

Now, the argument that they are making, Mr. Speaker, is that we're saving it so we can have a balloon payment next year, so that we can do all kinds of extra things in what they assume is an election year. If one looks at the long-term projections, Mr. Speaker, we are projecting - given our revenues and the need to maintain basic services, the need to maintain a consistent level of capital spending - that in fact, next year, the main estimates would show a slight dip in capital spending as we spend down our surplus gradually and responsibly, anticipating that, in year three and four, the full impact of the loss of population will have worked its way through the formula and our revenues will start to climb gradually and slowly once again.

We committed, Mr. Speaker, to ensuring that basic services in this territory would be protected. We committed to predictable and stable spending patterns. We committed to being a stable partner in an otherwise - as far as the resource sector is concerned - unstable economic environment. And that is precisely what we've done.

Now, Mr. Speaker, one of the member's themes is that the budget has no substance. Well, when the Yukon Party was facing a similar circumstance, when the Anvil Range mine shut down, their first reaction was to pass a budget with substance, I presume. It was known, by their definition, as a budget of substance. It contained some fairly large spending associated with the hospital construction project. It contained some fairly large spending associated with the Shakwak project. Those were both projects that were negotiated by their predecessors.

The other element of noteworthy substance in that particular budget was the record tax increases that they employed, noting that, when the public was facing some difficulty, that the public could always fork out a little bit more, so that a truly visionary budget could have maximum spending associated with it.

Last year, Mr. Speaker, the primary criticism of the opposition parties was that the budget wasn't visionary enough and the only thing they could suggest was that we weren't spending enough. So, it's only the massive spending budgets that constitute vision.

Well, Mr. Speaker, there's a poverty vision, if that is one's only definition.

Mr. Speaker, the members opposite have, on a number of occasions, as I've mentioned, said that the budget has no substance. I have said - and my colleagues have listed - the many initiatives that have come from discussions that we've had with business and labour, with communities and with social action groups.

Some ideas, I daresay, came even from the minds and the hearts of the members in government. In total, Mr. Speaker, we come forward with a budget with many initiatives, many new ideas.

And I would point out, Mr. Speaker, that - maybe the members opposite have not noticed this - this budget is still $25 million less than the record-sized budget brought in by the Yukon Party. So they've missed the fact that it's not visionary enough by their definition; we could be spending a lot more.

Well, Mr. Speaker, there are many initiatives, both on the economic side and on the social side, that I feel particularly fond of. There are a number of initiatives undertaken here that I believe meet the real needs of the people of the territory.

Mr. Speaker, when it comes to meeting not only the needs of the business and labour communities to stimulate activity, we have an array of opportunities that we are partnering with the private sector.

When it comes to low-income people, we have brand-new initiatives to address the needs of those people.

Mr. Speaker, I know that they're not quite what the Yukon Party had in mind. The leader of the official opposition - the leader of the Reform Party, the Liberal Yukon Party - across the floor has suggested that we are only targeting the child benefit to those people, in his words, who don't even pay taxes. Well, it may be that they don't pay taxes because they're low-income people, and they're in need of some assistance. And so, consequently, we're providing it - because it's the right thing to do.

Mr. Speaker, the leader of the official opposition has, on a number of occasions, suggested that the way to turn the economy around, in his words, is to cut and run from DAP - "Bury the DAP and the whole protected spaces."

Now, Mr. Speaker, it may be his style to cut and run from difficult problems; it's not our style. One cannot bury the DAP; the DAP is the law. One cannot run and shirk one's responsibilities on tough issues; they are there and they must be addressed. If there is an opportunity that can be realized from these initiatives, or if there is a gain to be made, we should search it out, hunt for it, work for it until we get it.

Mr. Speaker, the member has said that we should hold off on protected areas and hold off on the environmental agenda. This is the same member who was the Government Leader of the Yukon Party who was planning to implement protected spaces by next year.

Speaker: The Government Leader has two minutes.

Hon. Mr. McDonald: All of the ecoregions would be fully represented by next year. Can you imagine the chaos we would be in if that promise was actually meant and was actually realized?

Mr. Speaker, the member criticizes the budget for not having enough in Tourism. There is only $200,000 for tourism marketing. Well, it's a darn sight better than was done in the past, but the criticism, of course, ignores the fact that there is $750,000 in tourism marketing, and in another fund there is $175,000 in the film incentive fund; there is $300,000 in the millennium fund - all in this year. There are many good things happening to tourism. I could go on and on and on in all areas.

Suffice to say, Mr. Speaker, this budget has obviously got the broad support of people of this territory. This budget was no accident. This budget was crafted with absolute respect for the voices who made suggestions on how they want their government to operate, how they want their money spent.

I present it to the House, Mr. Speaker. I support it fully, and I hope other members support it, as well.

Speaker: Are you prepared for the question?

Some Hon. Members: Division.


Speaker: Division has been called. Mr. Clerk, would you poll the House.

Hon. Mr. McDonald: Agree.

Hon. Mr. Harding: Agree.

Hon. Ms. Moorcroft: Agree.

Hon. Mr. Keenan: Agree.

Hon. Mr. Sloan: Agree.

Hon. Mr. Fairclough: Agree.

Mr. McRobb: Agree.

Mr. Fentie: Agree.

Mr. Livingston: Agree.

Mr. Ostashek: Disagree.

Mr. Phillips: Disagree.

Mr. Jenkins: Disagree.

Ms. Duncan: Disagree.

Mr. Cable: Disagree.

Mrs. Edelman: Disagree.

Clerk: Mr. Speaker, the results are nine yea, six nay.

Speaker: The yeas have it. I declare the motion carried.

Motion for second reading of Bill No. 14 agreed to

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

Speaker: It has been moved by the government House leader that the Speaker do now leave the Chair and that the House resolve into Committee of the Whole. Are you agreed?

Motion agreed to

Speaker leaves the Chair


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

Some Hon. Member: Agreed.

Chair: We will take 15 minutes.


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

Bill No. 14 - First Appropriation Act, 1999-2000

Chair: Is there any general debate?

Hon. Mr. McDonald: The budget speech covered most of the ground related to the estimates, and I don't feel it necessary, of course, to cover all the same ground again now. There are a few remarks that I'd like to make before I get into general debate.

These estimates will carry us into the new millennium. While the government faces new challenges, the new millennium does provide a fresh focal point to begin to rethink where we're headed and how we'll meet those challenges. The Economy 2000 initiative is one of our responses to the challenges and opportunities that we will be facing in the coming years. This budget is an integral part of that response, and we believe it achieves an ideal balance between social and economic priorities insofar as those priorities are not one and the same thing.

The budget proposes expenditures of $478.9 million for the coming year. This expenditure is accompanied by a revenue inflow of $459.3 million.

We will therefore have an annual deficit in 1999-2000 in the sum of $21.4 million, after allowing for a $1.75 million contingency. The deficit is deliberate. It's part of our policy to gradually draw down on the accumulated surplus at the time when the territory's economy is in the process of restructuring.

At the end of the next fiscal year, we will still have a savings account of almost $28 million, to which the inevitable lapses will be added.

We are predicting a decline of over $36 million in revenues for the 1999-2000 year. This, of course, is not unexpected, since 1998-99 contained a one-time census adjustment and did not contain as much of the impact of the recent population decline which is now having a greater influence upon the formula financing equations.

The tax relief we are providing has also had a significant impact on our projected revenue inflow. Our total expenditures will be roughly $18 million less than the forecast for 1998-99, and this is not surprising either, since the forecast column contains capital revotes from the previous year.

These revotes and several special allotments in 1998-99 account for the greater portion of the decline in capital expenditures shown on page S-2 of the main estimates book.

If one were to compare mains to mains in this calculation, as shown on page S-7, one would see that capital spending is up quite substantially in the next year, as compared to the current year. Operation and maintenance expenditures have been held in check, and you will note they're increasing by only one percent over the current year.

The budget contains a number of important tax measures that will stimulate economic development and provide relief to people with lower incomes. Both the small business investment tax credit and the mineral exploration tax credit will promote investment in Yukon businesses and in Yukon's mining industry. We promised to make the Yukon an attractive place for responsible individuals and businesses to invest, and these two instruments are an important part of keeping that promise.

We've also announced that we will be developing legislation to permit the establishment of a labour-sponsored venture capital corporation in the Yukon. This will also promote responsible investment in the Yukon and help keep the savings of Yukoners available for investment in the territory.

Our efforts to establish an immigrant investor fund complement these initiatives and will make even more investment capital available to Yukon.

Relief to low-income people is being provided in the form of a Yukon low-income family tax credit and a Yukon child benefit. These measures are in keeping with our commitment to improve the lives of Yukoners and to help those struggling to make ends meet on incomes that are less than adequate. While these programs will be of aid to all low-income people in the territory, they will be of special importance to seniors trying to cope with fixed incomes and to families with children.

We are pleased to be able to provide the tax relief all these measures bring to our businesses and citizens and, I am certain, most members, at least, of the House feel the same way.

As I mentioned earlier, this relief has not, of course, come without a cost to our revenue inflow. In the 1999-2000 fiscal year, we expect the tax changes we are introducing to cost approximately $4.5 million, but it is a cost, we feel, well worth it, both in terms of the economic stimulus it will provide and the relief it will give to the less fortunate in our society.

Despite this loss of revenue, we've been able to maintain, and slightly increase, our O&M spending on health and education.

NGOs have been protected, and we have been able to provide municipalities a modest but important increase in their grants. Our employees have seen an improvement in their rates of pay, and we have been able to establish a health care professional development fund and undertake many other initiatives that are important to our citizens.

The same is true in capital, where we will continue to improve our highways, replace schools - notably Ross River's this coming year - begin work on a new continuing care facility, and construct the Teslin health centre, in addition to carrying out numerous other projects throughout the territory.

We believe this is a well-crafted budget. We're proud of the balance it achieves between the economic and social needs of the Yukon as we approach the beginning of a new millennium.

I look forward to hearing members' comments and questions they may have.

Chair: Is there further general debate?

Mr. Ostashek: I thank the Finance minister for that. I'll try to put a whole bunch of questions forward so the member doesn't have to keep jumping up and down, and we can get into more Q and A next week, when I hope he's feeling better.

I want to just not go back through the whole budget speech we had and comment on it, but I want to put on the public record why we felt - why I felt, and my caucus felt - we could not support this budget.

There's no doubt in my mind that what the Finance minister said in his closing arguments on this budget, that a lot of thought was put into this budget, is right. There was a lot of thought put into it, and there are some things in the budget that my caucus could support and don't have any difficulty at all supporting - some good initiatives. But the one thing that was lacking, that really kept us from being able to support this budget, was that we don't believe the government did enough to address the immediate problem - the immediate crisis - that's facing the Yukon, which is laid out in the document that was tabled by the Economic Development minister at the same time the budget speech came down.

This short-term economic outlook doesn't paint a very rosy picture of the economy in the next 12 months in the Yukon. In fact, I'd suggest to the Minister of Finance that this will be the toughest year with respect to creating employment for Yukoners. Right now, we have an unemployment rate of a little over 15 percent, I believe. There will be some new figures out a week from tomorrow. I don't feel very optimistic that those figures are going to be any lower. If anything, I suspect that they will be somewhat higher because if we look at the normal trends of our employment in the Yukon, usually we hit a high of unemployment in April or May, and then it starts to dwindle back.

And why I say that I don't believe the government has done enough to address that problem - and that's why we couldn't support the budget - is that it wasn't a fact of finances that they couldn't deal with this problem, it was a matter of choice. The government and the Finance minister have been quite satisfied for two consecutive budgets to have $15 million in reserve, and, as he stated in his opening comments now and stated earlier, after all is said and done, that turns into a fairly huge surplus, or has in past years. I don't see anything in this budget that's going to change that.

In fact, when we do look at the accumulated surplus graph that he has put on page 6 of his budget speech, it says that in this fiscal year, where we started out, I think, when the main estimates came out, there was about a $15-million surplus that the minister was allowing for. I haven't checked the exact figure on that, but I believe it was in that range. And we see that the projection is that that has grown to $60.5 million.

Well, Mr. Chair, it's very, very hard for me to explain to my constituents that this government doesn't have some flexibility in helping to put more Yukoners to work this summer. We've heard the Finance minister say - if we're to believe what he says - that they believe it will be a year to 18 months before mining picks up in the territory. I believe it is the government's role and responsibility to do what they can to pick up the slack in between.

I want to point out another area where I believe that the Finance minister and this government are not acting to put Yukoners to work now, which, I believe, they had the finances to do. They are making the problem worse, because the minister has already said in his forecast that they expect the transfer payments are going to go down because people are leaving the Yukon.

But by not putting them to work, even the short-term economic outlook - which, I might point out, Mr. Chair, was looking for more money in highways, which I don't believe they got, saying that that was going to take up some of the slack, but that hasn't happened - they are forecasting that another 700 people are going to leave the Yukon. Now, if we could have kept those 700 or 1,000 people here, that would have had an impact on our formula. So, it's a vicious circle, and I know the Finance minister is trying to be very "conservative", shall I say, in his budget estimates - "cautious", he says - whatever - but I believe he's being overly cautious.

He has proven himself that, with a $15-million surplus, he has been able to maintain a fairly healthy budget and I don't see any reason or any dramatic change in here so that that wouldn't be the same next year. In fact, I believe that, had he taken that extra $13 million that he's increased his surplus by - from $15 million to $27.6 million or $27.9 million or something that he's projecting - that $13 million would have put a lot of Yukoners to work. It would have put a lot of Yukoners to work and still would have left him with a healthy surplus for next year to be able to maintain a level financial picture without putting the territory in jeopardy. I hope the minister will respond to that when he gets to his feet.

That's one of the major reasons why we couldn't support this budget. Now, had the financial estimates that he put forward indicated that there wasn't any way possible that he could spend any more money and put people to work, I'd have accepted that. I would have accepted that he's done the best he could. And I can tell the Finance minister, regardless of the political rhetoric that we've heard in here, the Yukoners I've talked to about this budget, since it's come down, are not that happy with it, because they see exactly what I am telling the Finance minister here.

They don't believe the government has done enough to address the immediate problem. A lot of these people, Mr. Chair, are running out of employment insurance now. They're going to be on our welfare rolls. So again, it compounds the problem. We're back into that vicious circle - how much do we spend, what's the cost going to be and what can be done?

I believe that the Finance minister should have taken a little more risk, should have maintained his $15-million surplus and used that other $13 million to put Yukoners to work. I can tell the Finance minister right here and now, in all truthfulness, that had he done that, we would have had great difficulty in not supporting his budget - great difficulty.

Even though the spending priorities are different from what a Yukon Party government's would have been, we would have at least made an effort to put some more Yukoners back to work. I'm not saying he's not going to put Yukoners to work, Mr. Chair, because he is going to put Yukoners to work with this budget. What I'm suggesting to him is that even with the injection of the Shakwak money, we are not going to put any more Yukoners to work in this budget than he did in his last budget without the Shakwak money. That's the fallacy that I see in this budget and that's the weakness that I see in it.

So, that's what I would have done and I'm going to be looking to what the member's response will be when he gets up to speak again.

I want to put a few more things on the table that he can answer when he gets up to speak again. I would ask him if he could explain to me why he chose not to come in with a throne speech to announce some of the things that I feel would have fit better in a throne speech than they did in the budget speech.

The member has been in this Legislature long enough that I don't need to itemize those for him. He knows which items I'm talking about: those long-range projects that have normally been addressed in a throne speech in this Legislature, rather than the budget speech.

So I'd just like to ask his rationale for that. I believe it would have been an opportune time - halfway through his mandate - to come in with a new throne speech. We've only had a very short throne speech, when he first took office. He has now taken the opportunity to lay out all of his priorities in the budget speech, which I think throne speeches are reserved for - to lay out the government's priorities. And the budget speech is to lay out where the money's being spent in the next fiscal year.

The minister spoke at some length about legislation to activate the tax cuts that he's brought in with this budget. When he gets up, I would like to ask him if he's going to introduce that legislation in this spring session. Are we going to be able to deal with it in the spring session, or is he going to wait until the fall session to bring in the tax cut legislation?

I also have some questions on the immigrant investment fund. A lot of them I'll save for the Economic Development minister, but my understanding of the fund is - and I'd like the Finance minister to respond when he gets up - that the time allocation on it expires at the end of March, and in order for the fund to be activated we have to have at least a $3 million commitment. I would like him to tell me if I'm right on that or to correct me if I'm wrong on it when he gets up on his feet, and if, in fact, he believes that my assumptions are right - or my information is right - that he'll be able to meet that target and have the $3 million in place to activate the fund.

Personally, I don't have any difficulty with the fund. I think it's probably a good thing. I know some of the businesses that I have talked to are very, very concerned about it. In a time of economic downturn they believe this fund could create more competition for them, and they're very concerned about that. So I hope that this government, in their information campaign, will try to alleviate some of those fears in the public, because there is a substantial amount of concern out there to that effect.

They're just concerned how much more competition it is going to cause for them. I would like to get the Finance minister, when he gets back up, to maybe just give us an overview of how he arrived at the diminishing surpluses over the years up to 2003. What's he basing that on? What information does he have that he can give us that he's reached those calculations on? I know there are always some assumptions that are made in projections. How much factual data do we have, and how much is a best case scenario, even though the surplus budget, in my opinion, in 2003, is not even that small - $14 million. That's basically what this government was operating on in the first couple of years.

Another area that has really concerned me and my caucus quite a bit is the tremendous growth in government. I know that the Finance minister and I have had this debate time and time again, but we need only to turn to the main estimates - the historical main estimates that are in his budget book - and we find that, in 1996-97, when this government came to power, the main estimates were $346,821,000. With this budget, they're going to be $384.2 million. That's a $37.3 million increase in three budgets.

Now, I know that they've got the devolution of the second phase of the hospital, but that doesn't account for all of that growth in government. We've seen the stats from last year, but we're still waiting for some information from the member, in his capacity as Government Leader. He disputed the fact that there were 377 new employees in government. He said that that was wrong. I haven't seen evidence of him correcting that, because those figures were taken from StatsCan.

I would like to have some explanation of why this government believes that they need that amount of growth in government, especially at a time when the population of the Yukon is shrinking.

We're down, even by his own people's estimates, to 31,500 by the end of 1999, and I know that there are skeptics out there - and I may be one of them - who believes that it will even be lower than that unless something dramatic happens in the next six to eight months, and nobody sees that on the horizon.

So, why do we need more people to service a smaller population? I just don't follow the rationale in that.

As I pointed out earlier - and I'll point out now, and we'll take it up when we get to the highways department - I believe in the capital budget, if we look at the capital estimates and look at the highways budget - and I think we made a point to this effect in the fall session of the Legislature, Mr. Chair - because of the Shakwak funding, we didn't want to see a severe cutback in what the territorial government was spending on highways. And yet in fact we see about a $7-million reduction of territorial money into the highways budget this year. That's a lot of jobs. A lot of Yukoners could go to work with that.

On top of that, Mr. Chair, the day that the Finance minister delivered his budget, the short-term economic outlook was tabled. That morning on the radio was the report that wholesale sales in the Yukon had dropped by 15 percent. At the same time, they had gone up by 12 percent in the Northwest Territories, where they said that consumer confidence in the Yukon was negative, because the increase in retail trade was only less than half the national average, whereas they said that consumer confidence in the economy in the Northwest Territories was high.

So, I've said quite a few things there, Mr. Chair, for the minister to respond to. I would hope that he would respond to them. I'll take some notes. I'm sure that we'll come back to this on Monday again, but I'll get some general information now before I go further.

Hon. Mr. McDonald: Mr. Chair, I thank the leader of the official opposition for that. I'll just speak generally about some of the items he's mentioned and come back with more detailed information on Monday with respect to other issues he's raised.

I'll first mention to him that the projections that we have listed in the budget book for future years' revenue and expenditures are best estimates from the Department of Finance, based on the factors that are identified at the bottom of the page. These estimates are a best guess by the Department of Finance at this point. There is an expectation that population changes will roll through - they started rolling through last year. It was masked somewhat by the fact of the one-time census adjustment. It will continue in force this year, next year and the year after, and then there's an expectation that the revenues will climb gradually after that.

Projections with respect to the O&M and capital, of course, are, once again, sort of a best estimate. The member will know, I'm sure, that the choices will be made by governments of the day, when the time comes. What we're attempting to demonstrate here is that, with these best estimates of revenue, and with our notion of what we think will be in our reserves, we believe that we can maintain service levels in the territory, in key and critical areas, as well as maintain stable capital spending, throughout the next period.

The short-term outlook the member has cited was tabled for very good reasons. That wasn't an accident. We want the members opposite to know we are very well-aware of the implications of what is happening. I believe this capital budget will, in fact, because of its improved, targeted nature, create more jobs than last year, and I'll bring information to help justify that so that members won't have to take my word for it. But, in terms of my general thinking, I'm letting the member know what our expectations are.

Now, the member mentioned that the primary reason, I suppose, why his own caucus cannot support the budget is because the amount of spending is insufficient to meet immediate needs. I would suggest to the member, with great respect, that if we were to spend the entire surplus that's here - all of it - we would still be facing difficult economic circumstances unless the mineral industry and forest industry rebounded. There is nothing that we can do in terms of raw spending power, short of borrowing money, to replace the Anvil Range payroll, and now the BYG payroll, and the mining activity of the past, the forestry activity of the past.

We have to, in my view, target our spending carefully and play an additional role, besides simply trying to fix everything ourselves with just raw spending, and that role is to provide a stabilizing force when things are tough.

The member makes a good point that the government has an obligation to do what it can to create jobs through direct spending, and the member has always made a good point that some of that spending should be in capital. But I make this general point: I believe that if anyone should think longer than the immediate term, it should be the government and this Legislature.

If we had spent most of our surplus last year to meet last year's needs, I contend that our economic circumstances would not have changed substantially - that's on the assumption that we could have actually delivered those capital projects. The member knows from being in government that just because money is voted and plans are made, the money doesn't always get spent.

But let's say for the sake of argument that we could have spent the money. This year we would have had to cut back expenditures at a difficult time in people's lives, when they do not need more shocks to their system. That's why we moved ahead with the rate stabilization fund to ensure that people do not have to face further shocks on that front at a difficult time. But it's also primarily the reason why we've tried to project, as well as we can, into the future, and use the savings account that we have - that we've carefully developed over our government and over the previous government's term - to even out the rough period.

Consequently, I believe that it is sustainable, dependable, reliable spending that is also required. I think that if, for the sake of argument, we were to project a $34-million annual deficit, I'm sure the harrumph from the Liberal Party leader would have been even more pronounced. But, nevertheless, the situation for next year, if the resource economy had not rebounded, would be worse and people would not have appreciated the government's lack of foresight.

One also must take into account, though, that even if the economy did rebound, our revenues would not immediately rebound because of the way our grant is calculated. We could be in a very difficult situation where, say, for the sake of argument, the economy had rebounded, people have moved in and service is required. Our revenues, thanks to the population dip from before, would still be playing out in our formula financing calculations, and we would still have faced some difficult circumstances.

So while I appreciate the attractive nature of the savings account, I would beseech the member to look at a two-, three- or four-year horizon. I believe that it is necessary for somebody to do that, and I don't believe that that's too far in the future. I believe that most people would regard the next two or three years as being short term, and they would expect the government to provide not only basic services, which we've committed to do, of course, but also to provide the same level of capital spending, year by year.

We want to be able to spend in the $50-million range for capital projects - both building projects and community support projects of all kinds. We want to be able to do that, and we believe it's necessary to plan for that, so that if the resource economy does not turn around as quickly as we want, the government will still be there.

I understand what the member is saying, and I wish it were possible. I would ask the member to think on a little longer term than just the short term. I don't quite agree that we could stem the tide by simply spending the savings account last year, and therefore the population would still be here and therefore we would not have faced the decline in our revenues, because the reality would be that we would have a much larger population and we would have substantially fewer funds this year to provide support. I think that that would have made things very rocky for people, and I don't think people want that. In the many budget meetings that I've had with people, they want stability, they don't want more instability.

So, while it's an important and useful process for us to go through the budget and to determine whether or not the government has made the right choices, in terms of targeted spending, for maximum job creation, in global terms, in terms of savings and stable spending, I think we have made some wise short- and medium-term decisions, which I believe are supported by the majority of people.

The member asked the question about the throne speech, and why not another throne speech? I guess the reason, Mr. Chair, is that I believe our plans for the government are well known. There's been a substantial amount of debate in the Legislature, and there will be substantially more opportunity for debate.

We have not changed direction as a government. We set out a comprehensive plan early in the term. We've had a number of opportunities to debate the terms of that plan, in terms of the projects that we believe are priority projects that the public has raised with us and that we have brought to government from the last election. I would see a need for a throne speech if the government felt that it was turning a new corner and moving in a new direction, wanted to telegraph that change and get some debate on the subject. But I believe that the opportunity through the budgets, through planning and the interrogation of ministers makes very clear the government's plans, and it allows substantial scrutiny of those plans.

The member asked the question about legislation for the tax cuts this sitting. Yes, it is our intention. I will provide these as finance bills and consequently part of the agreement between caucuses, and this would come forward now - with the exception of the labour-sponsored venture capital corporation legislation, which we wouldn't intend to come forward until the fall because we're not ready.

Some of the details of the various tax measures are still being worked out. We had very short time from the time that the tax table recommended these options and we accepted them to the time that we made a decision to proceed. So, there are some small details that we're still working out, and they will be resolved prior to the legislation coming before the House.

The member asked about the immigrant investor fund, and I'm certain that the - he asked whether we would achieve $3 million by March 31, in order for the fund to take effect.

I can tell the member that we have - even as recently as yesterday with the federal minister responsible for the fund, who is in town - asked the minister for an extension to ensure that we meet the deadlines. We have a compelling argument that this territory needs investment capital, and if there was ever a good reason or rationale or justification for an extension, certainly, I think we would qualify. But, of course, there are other jurisdictions in Canada that are also asking for an extension. They happen to be small jurisdictions like PEI, so we're not out of sync with them.

The member expressed concern about where this money would be invested and whether or not care would be taken to ensure that the government is not funding competition for existing businesses. I agree that that is a concern, and it's a very legitimate concern, and any decision made as to the allocation of this fund will have to take into account the need not to compete head-on with existing businesses. The minister responsible for the fund can provide more clarity to that, but the issue that the member raises is a valid issue.

The issue about growth in government is something that I would be happy to continue on in terms of debate with the member. I don't equate the growth in O&M budgets as growth in government. There are many things that the government spends money on that could easily be either through the O&M budget or the capital budget. The increase, for example, to the municipal operating grants is an operating fund increase. The grants could easily be in the capital budget.

We could transfer one to the other. In neither case has it constituted growth in the Yukon government. Now, he may argue that it's a growth in municipal government but in neither case is it, in my view, a growth in government.

We have, in fact, taken some time to control the growth of internal spending. As I mentioned in the budget speech, spending on such items as internal systems development, office space, et cetera, has taken a nose-dive during our administration and a substantial decrease in this budget as well, because we want to spend more money more broadly into the community.

With respect to the personnel issues, I will respond to the member on Monday with respect to the size of PYs and the analysis on FTE. I believe I have a very good response for the member.

There are reasons for the growth in O&M spending and the member is right that a large portion of the growth from 1997 through to this year is the result of devolution. A portion is the result of collective agreements, and the member may take issue with our decisions to provide for some increase to public servant wages. We believe that they are reasonable, modest, justifiable and they certainly do constitute a fairly large portion of the increase.

There are other increases, of course. The biggest other single increase is in Health and Social Services.

I will remember the supplementary in the first year of our office where we increased Health and Social Services and, to a lesser degree, Education, in fairly relatively large amounts. We believed that that was a necessary expenditure then. We have not faced the full impact - and I've asked for more analysis of this - of what a declining population means in terms of the required number of teachers and the cost to the medicare system, for example. Hopefully in the coming months we'll get a clearer sense of how that is affecting the operating budgets of the service departments in the government.

I believe that the O&M expenditures that we've put forward are justifiable. I believe that they're very explainable.

The member asked a question about - I'm going to sit down in a minute here - the highways budget and said that a reduction in net highway spending, other than Shakwak, was going to mean a reduction in jobs. Well, I can assure the member that the money has not been lost from the capital budget, that it is directed in the capital budget for jobs and there is certainly more emphasis, conscientiously so, put into building construction, which I believe - and the member and I have had this debate many times in the past four or five years - will ensure that that industry meets its needs and provides the necessary infrastructure, which I believe the community is requesting.

While we do believe in highway construction and have taken a lot of trouble to renegotiate the Shakwak agreement and see an extension, it is my contention that there should be a balance of capital spending to meet some of the ongoing needs on the building construction side, whether it be, in our case, the need for some new schools and an extended care facility, to mention just a couple.

I believe that they're desirable. Certainly, there probably will be debate about the necessity of providing support to municipal recreation projects. They have been listed, time and time again, as priorities for certain municipalities, and we have responded positively in three cases to those municipalities. We believe that they're justified and they're wanted by the general public, and so we responded. They will result in jobs - not road construction jobs, but building construction jobs.

I expect the member and I will have this debate perhaps as long as we're both in the House.

In terms of the other information that the member has requested, I've glossed over a couple of issues for which I feel the need to provide some detailed information, and I will commit to returning on Monday with it.

Mr. Ostashek: I want to thank the member for that. I'm sure we will have a continued debate as to government spending priorities. I just want to touch on some of the areas that the member opposite touched on, with some rational debate, and not political debate, on the issues.

The member opposite is fully aware that when a business is faced with low revenues it looks seriously at the cost of doing business. It doesn't appear that this government is doing that. When we do look at the main estimates, they're consistent. I mean, there was stuff in O&M before that could have been considered in capital. I mean, we're comparing apples to apples.

Unless the member can stand up there and tell me of some specific change in accounting that he's done to justify that that's one of the reasons for a larger O&M, I can't accept it.

His own stats branch figures said that, from June of 1997 to June of 1998, the civil service increased by 377 people. That's a substantial increase. Part of that's the hospital transfer - about 200 - but almost 200 of them weren't the hospital transfer.

We will get into the numbers of people in each department as we go through department by department. I'm just talking about the general budget now, in the member's responses to my questioning on it.

The member says that if he spent the entire surplus he couldn't replace the Faro payroll, and I agree with him. I agree with him 100 percent. I don't have any difficulty with that. But from what I've gleaned, from what the minister has told me, is that he and his administration are prepared to tough it out, not spend any more money on putting people to work now, even though there's a large number unemployed; allow some more people to leave the Yukon, so that they can stabilize spending on a much lower population base.

And I think that's wrong, because we're losing a lot of skilled people, who are going to be very, very hard to attract back, if the Finance minister's right and mining rate picks up in 12 or 18 months, if other things start to happen. We're going to be going out and trying to recruit a skilled work force, because we had them; we've lost them.

But I've gleaned from what the Finance minister has told me that this government is quite prepared to stabilize the spending of government on a much lower population base than what the Yukon had - I think in 1996 it was 33,500 going toward 34,000. Now it's down to 31,000, I believe. I could be wrong on those numbers, I'm not exact on them, but I know it was much higher than what it is today.

It's the government's responsibility, I believe, to try to do everything they can to retain those people, so when the economy turns around, they have them. They sell their homes, they leave - they're not coming back.

They're not going to come back when the economy turns around.

This government has spent a tremendous amount of money on training trust funds, and we believe in training people, but when we have a lot of qualified people already for the jobs, I think we're compounding the problem.

We're compounding the problem. We're not addressing the serious issue we have about the trained people who can't get jobs, and it's a balancing act, I understand that. And I would be the last person to ask the Finance minister to spend his entire surplus, and I think the member opposite knows that. I would have expected in these tough and trying times that he would have been satisfied with his $15-million surplus, which in this year has grown to $60 million from his projected estimate of $15 million. The projected $27 million next year, I suggest to the member opposite, could grow to $70 million if we look at the consistency of what the lapses have been over the years.

So, I don't see where he is that short of money, and we're going to have this debate. I'm not going to convince him of anything different, but I'm going to get my thoughts on the public record that I believe that he could have taken another $13 million to $15 million, put it into capital and created a couple of hundred more jobs at least. That would have done a tremendous amount to lower the number of unemployed. It would have qualified a lot of people for employment insurance next year to get through the tough period to where there are more jobs in the private sector. That's government role, I believe. I firmly believe that.

As I told the member opposite, I don't have any difficulty with some of the long-range stuff he has done in the budget. I don't have a lot of difficulty with training people. I think they should be trained, but what are we training them for when we have our skilled workforce leaving the territory while we're spending hundreds of thousands of dollars training other people? There has to be a balance there somewhere. There has to be a balance.

The Finance minister said he wished I'd look out two or three years ahead. Mr. Chair, I'm going to say to the member opposite - we'll get into a big political debate - I wish he'd had that approach when he was in opposition. If you will recall, the year that we brought in the two-percent rollback, we were projecting a $2-million surplus. That's all we were projecting. The member opposite was one who said that the rollback wasn't required. I'm not going to get into that debate again. I'm just pointing out to him that what he said in opposition is quite different from what he's saying now that he's driving the truck.

The same goes for the throne speech. I got criticized severely by his leader at the time, and I believe him - I know his leader, for sure - for not bringing in throne speeches and for addressing things in the budget speech. So, that's why I asked the question. But it appears that the Finance minister's thinking has changed on that one, and that's fine. That's the way he feels now. I just wanted to be satisfied in my mind that I knew why he was doing it that way.

Mr. Speaker, he made a statement in here - and we'll get into great debate with the minister responsible for the Energy Corporation - that that's why they brought in the rate relief program - to stabilize power rates and freeze them for four years. But I suggest to the Finance minister that all they've done is delayed the problem because, at the end of that four years, what's going to happen? Or, two years - I think we're going into the second year of it now. We've just completed the first year, and we're going into the second year.

We've heard the Economic Development minister say that it's 12 to 18 months before we can think of a turn-around in the mining industry. We don't have much more going in the Yukon, outside of government employees - and there's nothing wrong with government employees; we need government employees - but I think we seriously have to look at what we're doing. Are we addressing the problem, or are we just delaying the problem?

The Finance minister said, when I asked about the immigrant investment fund - and I don't want to get into details of the fund with him, I'm just trying to get some parameters - he said that they've asked the federal government for an extension. When he rises again, I would like to know how long an extension they've asked for, and I want to ask him if I'm right in my interpretation that it needs to be $3 million before it can be activated, or can it be done on a smaller amount of money? I understand, from what the Economic Development minister has told the public through the media, that he has a commitment of $1 million at this time. I just would like to clarify that.

I don't have any difficulty in dealing with the finance bills this session. I just want to know for my own mind. In fact, I'm happy that the government is going to bring the bills in now to deal with them at this time so that the tax changes could come into effect.

I will have a lot of questions on how the tax cuts are going to work, but I'll save that for the Finance department debate.

When the minister responds, I would just like to ask him so that I can clear my mind, has there been any change in accounting that would substantiate what he has said, that some of this stuff in O&M could be in capital? I want to know that I'm comparing apples to apples when I stand up in the House and say that, in his own budget documents, that's what it shows. If there's been any change in accounting, I would appreciate knowing it. And I'm going to look forward to still getting that information and an explanation from the Finance minister on the discrepancy between the figures the Public Service Commissioner gave in here on the number of employees and what the stats branch said there was last June.

I'll just leave it at that and let him respond and then I'll let my colleague, the leader of the Liberal Party, ask some questions.

Hon. Mr. McDonald: Mr. Chair, just on the last point first, we have made no change in terms of the accounting of what constitutes capital and what constitutes O&M. The point I was making, though, is that the decision as to what is one and what is the other is sometimes very arbitrary. The point I was making in the context of the size-of-government debate is that the size of the O&M budget by itself is not an indicator of size of government, in my opinion. There are a number of items in this budget that provide support to the community, one way or another, but don't constitute the addition of a public servant, a desk, telephone, fax machine, et cetera.

So I will, as I indicated to the member, bring back an explanation with respect to size of government, inasmuch as it's counted by personnel, and then we can have a discussion on Monday as to that indices for the size of government. I do, and I have indicated, that O&M budgets alone cannot be used as an indicator of growth in government, so to speak.

In terms of the issue about whether or not to put the money to work now, I tell the member this: I believe that the short term is one to three years. I don't believe the short term is one year. The money that is in the savings account is, by our projections, being put to work. It's just that it's not in one year.

We do expect a decline in revenues, as I've indicated, and we want to put the money to work, but not have any shocks to the system.

If, for example, I ask the member to imagine, not very far ahead, only one year ahead - we'll all be here, God willing - and if, for example, we were to add $13 million now and we were to spend $13 million more in the budget this summer, I would contend that if the resource economy did not turn around those tradespeople would still be here, the people who we supported this summer - they'd still be here. The population would not drop as much. People would still be here, but we would have a $35-million net capital budget if these projections are correct or we would have some combination of a lesser O&M budget and a lesser capital budget with the people still here, and we would be faced with a very, very difficult situation, a situation that would be very bad for the business community, very bad for the territory's morale. It is possible that if the mineral prices do not turn around and the mining economy does not recover that that just may be the situation.

We have to, in my view, make some hard decisions and look ahead to that moment. I've been in the Legislature almost 18 years and we've been through a roller coaster of good and bad times in that period. I've been around long enough to feel the effects of the decisions others have made and decisions that I have made - over and over again. I have a longer term horizon than just a year in the back of my mind and I know that we're all going to be here next year and I know that we could either be debating a $50-million capital budget next year or a $35-million capital budget next year.

I would rather us know and be able to tell the community that there will be a $50-million capital budget and that the projects that they would like to see happen can happen.

With respect to training trust funds - perhaps in order to get the Liberal leader a chance to wade in here, I'll be very short, but we can continue on Monday - I believe that training trust funds should be targeted to meet very specific community needs, and I believe that that is the intention of that program. The training trust fund, for example, for the sawmill in Watson Lake was put to very good purpose, I believe, and in that particular case it did lead to jobs. I believe it was a worthwhile project.

Even if a project is put to supporting the training of transition home workers, I believe that that is useful if it makes the service better and gives a net benefit to the communities that are served by those people, and is worthy of some measure of support in the budget.

Everything, as the member had mentioned, is in balance; nothing is absolute. Even the member opposite has never said that in order to have a healthy economy all the capital budget should be in roadbuilding and nothing in anything else. So, it's all in balance. They funded training projects when he was in government too - and some building projects in government too. I guess where we have a tendency to disagree is in the nature of the balance, and I'm certain that that discussion will carry on over the next number of weeks.

In terms of my thinking on budget planning, my thinking really hasn't changed on budget planning.

I don't know whether it's changed on throne speeches. My memory's not that perfect. I certainly know that Mr. Penikett was very big on throne speeches and made a persuasive case that throne speeches should happen all the time - loved the notion of throne speeches.

I've always believed in throne speeches as being an indicator of general direction of government and setting that direction, and that if you want to change direction, by tradition, the Queen's rep - the Commissioner - comes in and sort of lets everybody know.

But we're not changing direction. Everything that we're doing is very much part of the original plan. It's only been a couple of years that we've been into this, and we're working hard at completing a number of projects. So, I may well be out of sync with Mr. Penikett on this subject; I don't know.

With respect to the rate stabilization fund, the member says that if the fund is not replenished, then it's a problem not solved but a problem delayed. In characterizing it that way, he's right. If the mechanism is not there to replenish the fund, then there will not be a fund available to keep bills stable.

But I would argue that there is the possibility of replenishment. There are mechanisms that can be employed. It'll certainly be easier if the economy rebounds and there are more users on the system. If there are not, of course, it'll be harder to replenish the fund.

But I heard a lot of people say that, given the circumstances of the moment, they wouldn't mind a little delay of yet another hit on their system - businesses, communities, individuals didn't want to go through the agony of bill increases at a difficult time.

A delay is better than nothing. A delay, in fact, in this respect, is a significant achievement and a very large investment in putting money back into people's pockets. I do have, however, some optimism that the economy will rebound. The resource economy has rebounded before. I think we'll be well-positioned on the rebound, and I believe that we are doing things - despite what some members have said - that are diversifying the economy, slowly, and will produce results and make it easier in the future for all people. And, darn it, the business community is with me on that subject. Maybe opposition members are not, but the business community is absolutely on side. And the other partners who are seeking to join and participate are on side. They see the inherent value, and they want to work, and try to improve the economy, in whatever way they can.

The member made some mention about the immigrant investor fund. I don't know the specifics about the length of the requested extension. I do know that we do need about $3 million by March 31, if we don't have the extension. But I understand the federal minister gave a favourable, or at least a friendly, reaction to the request, noting, of course, the circumstances - not that she's unaware of the circumstances in which we're operating here.

Mr. Cable: The Liberal leader has a number of questions, but there's something I'd like to get on the record - some requests to the Government Leader for Monday.

There was a discussion on legislation being tabled this session, to put the various tax credit initiatives into effect, and it would be useful if we got, for Monday, so that we can continue the debate, a list of the legislation required and the effective dates when it's supposed to come in. In particular, if I could just go over the budget press release, the things that come to mind. This may not be exhaustive; there may be other legislation necessary. We talk about the low-income family tax credit, the Yukon child benefit, the Yukon small business investment tax credit, the Yukon mineral exploration tax credit, the immigrant investor fund, the labour-sponsored venture capital corporation which we've talked about, and the seniors property tax deferral option. If we can get confirmation as to which of those initiatives will be brought forward in this session, and any others that will necessarily have to be dealt with in legislation, that would be useful, together with the effective dates.

I'd also ask the minister whether he's prepared to table the bills soon - I gather they're not all drafted - or whether he's prepared to circulate the bills among the official opposition prior to tabling. As he will recollect, the Minister of Justice circulated a number of bills prior to tabling them so that the opposition could take advice on both the drafting and on the substance. I suspect these bills will require some advice to be given to the opposition members, so perhaps the minister could deal with those issues and let us know whether he's prepared to do those things.

I should indicate that we have no trouble with the financial bills or his interpretation of the agreement.

Hon. Mr. McDonald: I can bring the detail that he requests to the member on Monday. We're largely talking about the Income Tax Act, and there will be changes that will reflect our needs with most of these measures - and other changes that we historically do undertake that reflect changes in the federal system will also come forward.

The labour-sponsored venture capital corporation will come, I expect, in the fall. We're not ready to proceed immediately, but it is our intention during the course of the budget year to proceed, so this is essentially giving notice that we are in agreement with the notion and that we will proceed. I've already spoken to the tax round table about the desirability of discussing with them the policy issues associated with that particular measure.

The seniors property tax deferral will be a special, new piece of legislation, I understand, and our plan would be that it would come forward this spring. I'm not certain what legislation will be associated with the immigrant investor fund, but the other items that are listed - the LIFT credit, the child benefit, small business tax credit and the mineral exploration tax credit - will come forward, I believe, through the mechanism of the Income Tax Act, but I will provide an exhaustive list that he requests on Monday.

Mr. Cable: Okay, just for confirmation, and the minister can nod his head, will he provide us with the bills as soon as they're drafted - copies of them - because they are complicated bills? They're above our skill level, let's put it that way, and we need some advice on them.

Is he prepared to do that?

Hon. Mr. McDonald: The member could have asked that question in the last round of questions.

In terms of getting the bills in advance, I don't have any problem with that. We know that we should try to bring them forward in this sitting and this sitting will be two months long. As I mentioned to the leader of the official opposition, not all the details have been resolved. Minor policy details have not been resolved, but the major ones have. When they are resolved, they will be part of the bills and they will be debatable here.

Ms. Duncan: I have some general comments I'd like to put on the record to begin with, Mr. Chair, and I'm certain that the minister would be able to provide more information on Monday to save the difficulty of returning to his feet.

I'd like to just generally and very briefly - because I don't want to get into a very long, semantic discussion - address the comments the Minister of Finance/Government Leader made as to why on earth the Yukon Liberal caucus wouldn't support the budget.

Certainly, at first glance, when one examines the budget document, it's hard not to find something for everyone. There's an address to seniors, there are the new schools that have been long discussed by school councils, the Yukon College funding has returned to its previous levels, there are recreation facilities, swimming pools and fire smart communities and there is something for everyone and there is maintaining the status quo.

The tag line of that is that you have to wait long enough to see all of this realized.

And there are many Yukoners, and the ones whom have spoken with me - and I'd like to just talk about just even the last few whom I've spoken with and who, in response to the budget, have been in my office and spoken with me or contacted me by telephone. One individual is a senior who failed to see any benefit for him - a lifelong Yukoner; actually a resident of the Government Leader's riding who just said, "You know, what is there really for me in this?" Yes, there is a long-term seniors centre, a care facility. Will he still be here? I don't know.

There is an unemployed single mother living in my riding, another long-time Yukoner who has returned to Yukon College and has unfortunately not been able to find work after completing her training. There are government employees who don't see inspiration, and there is a long-, long-time Yukoner who is of an age bracket that I don't want to use "middle-aged" to describe - perhaps in the middle years - who is unemployed and not seeing hope.

Those are the people that this budget doesn't address. I can't hand them a document and say, "Yes, I can see where this budget is creating jobs, where this budget is going to address what you've expressed are your needs."

And the Government Leader and the members of the government side have chosen to focus on the words that I used - "where is the substance?" It's long term, and it's too little, too late for these people.

I chose to focus, when I immediately addressed the budget, on the commitment made of balanced budgets, and the Government Leader chose to respond to that. For Yukoners, I think, that's a political argument, so much of a semantics argument that they're tired of from politicians. They want clear, responsive solutions.

There's been much said, as well, that the Liberal caucus did not support the budget, and therefore did not support all these views of Yukoners. Well, I'd like to see the minister respond to that with information from the meetings with Yukoners. I'm certain it's public information - the public meetings - and unlike the opposition inquiry into education of some 14 years ago, we didn't send a researcher around to every finance discussion with the Government Leader. I would like the information from those meetings.

If the Government Leader is saying this reflects the views of Yukoners, and the wishes of Yukoners, what wishes didn't make it? What suggestions from Yukoners didn't make this budget? And where did the proposals come from that did?

The minister and his members have said that this reflects Yukoners. Well, let's see the information from the meetings.

I'd also like to just briefly touch on this business of public/private partnerships. I went back to Hansard for the debate that took place last year on this subject. The Government Leader feels that the Liberal caucus has made some specific suggestions. Certainly, in our public dealings, there's one specific project that we have talked about over and over again.

Has the Government Leader assembled any information on these projects and what potentials there are? He seemed a little more enthusiastic about the idea when he responded earlier today, and I'm wondering if there is some information being collated on these options.

The minister, in response to my colleagues, has also talked about consultation with other governments, in terms of financial arrangements and tax measures worked out with Revenue Canada. Could I ask for a more detailed time frame and information on that? We also had discussed, last year at this time, multi-year forecasts and the minister, last year at this time, tabled and passed to all members a multi-year forecast. Is there an update that has been, or could be, provided to members?

The point that I think needs to be reviewed is how Yukoners feel in terms of confidence in the economy, confidence in the budget, confidence in the way the government is spending the money. And when their ideas perhaps are not reflected - sometimes they are - there's a reflection of that in the votes that take place in this House.

Perhaps the Government Leader would like to respond later, or would he like to respond now?

Hon. Mr. McDonald: Mr. Chair, the member has questioned us enough that I'm sure we can discuss the matter for a good 15 or 20 minutes on Monday, so I'll reserve my comments until then. I'll just make one point to the member.

There's one thing this budget can't do, and that is do everything for everybody, and choices are made; there is no doubt about it. So, if I wanted to go out and hunt the streets of Whitehorse for somebody who will not be directly affected by this budget, I might find somebody. I think it's important that we all, even in opposition, send out realistic signals about what it is possible and not assume that this budget is going to replace any downturn in economic activity.

I'll just say one thing quickly to the leader of the official opposition. The extension requested for the immigrant investor fund is six months from the other deadline date.

Mr. Chair, I would ask that you report progress on the bill.

Motion agreed to

Hon. Mr. Harding: I move 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 the report from the Chair of Committee of the Whole?

Mr. McRobb: Committee of the Whole has considered Bill No. 14, First Appropriation Act, 1999-2000 and has 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. Harding: I move that the House do now adjourn.

Speaker: It has been moved by the government House leader that the House do now adjourn.

Motion agreed to

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

The House adjourned at 5:25 p.m.

The following Legislative Returns were tabled February 25, 1999:


Ministerial fleet vehicle use from June 1, 1998, to October 31, 1998: dates, minister, and government business undertaken (McDonald)

Written Question No. 7, dated November 16, 1998, by Mr. Jenkins


Travel claims as minister by the Member for Ross River-Southern Lakes approved by the Government Leader (McDonald)

Oral, Hansard, p. 3981


Northern Affairs Program (NAP) resource management transfer: process outlined (McDonald)

Oral, Hansard, p. 3987