Whitehorse, Yukon

Thursday, December 12, 1996 - 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?


Recognition of achievement of Gina Nagano

Ms. Duncan: I rise today to pay tribute to a particular Yukon woman. Gina Nagano, originally from Dawson City, joined the RCMP in 1985. She attended recruit training in 1988, and was posted in the Yukon until 1996, when she was posted to Dease Lake.

Gina Nagano is the first female Yukon aboriginal to be promoted to the position of corporal within the RCMP. She will receive her promotion on February 15, when she will assume her duties in Fort Simpson, B.C. Gina will head the detachment, composed of herself as corporal and two constables.

I am sure all Members of this House will join me in offering Gina Nagano our warmest congratulations.


Speaker: Are there any introductions of visitors?

Returns or documents for tabling.


Hon. Mr. Sloan: I have for tabling today the Yukon Hospital Corporation financial statement, March 31, 1996.

Hon. Mr. Harding: I have for tabling the Business Development Advisory Board Annual Report for 1995-96.


Petition No. 1

Mr. McRobb: I rise today to present a petition on rate relief that was circulated in most Yukon communities. It received a total of 1,746 names.

The petition has come about as a result of the concerns of many Yukoners on the following: the electrical ratepayers in the Yukon were faced with a rate increase of 31 percent after the last shutdown of the Faro mine in 1993; power rates are now subsidized by the territorial government with no commitment to continue the subsidy beyond the end of this year; the electrical utilities have made profits higher than allowed by the Yukon Utilities Board; the money for the rate subsidy comes from those profits; and, the electrical consumers in the Yukon expected and deserved lower rates when the Faro mine reopened.

The people of the Yukon, through this petition, are urging the government to take action to ensure that the utilities return excess profits to electrical ratepayers, that rate subsidies be continued and revised, and that electrical ratepayers have long-term, affordable and stable rates.

Speaker: Are there any bills to be introduced?

Are there any notices of motion for the production of papers?

Are there any notices of motion?

Are there any statements by Ministers?


Rate relief program

Hon. Mr. Harding: I would like to inform Members of the Legislature that rate relief for residential electricity consumers will be extended for another year. Our government will direct the Yukon Energy Corporation to use a portion of annual profits to fund rate relief until December 31, 1997.

As Members may be aware, rate relief was created in response to steep rate hikes in 1993. The intention of the program was to ensure that increases to power bills for residential and small business consumers were limited to 15 percent. The relief was applied to the power bills, not power rates.

The situation I have just described has created policy considerations on how rate relief should be used in future. In the electricity industry, rate relief is generally used to stabilize power costs to consumers when rates are volatile. Rate relief used to bridge a period of market instability is a form of consumer protection. The program also demonstrates the benefits of public ownership of this utility.

By extending the current rate relief program for another year, we will provide an opportunity for the energy commission to conduct a full review of the program. The review will include public stakeholder consultations and produce recommendations to government.

The energy commission will consider three principles while conducting its review.

One, our government believes that electricity subsidies should be primarily focused on the needs of seniors, low-income earners and people living on fixed incomes.

Two, our government believes that Yukon people deserve affordable access to a basic service such as electricity.

Three, our government believes that residential consumers in Whitehorse and rural communities should be treated fairly.

In 1997, the Yukon Energy Corporation will return about $1.6 million to residential electrical consumers in bill relief.

Based on rates approved by the Yukon Utilities Board earlier this year, rate relief in 1997 will keep residential customer bills at the same level as the past three years for the first 1,000 kilowatt hours of electricity used each month. Most residential consumers in Yukon normally use less than this amount of electricity in all but the coldest winter months.

In addition, rate relief for 1997 will ensure the same benefits for residential consumers using over 1,000 kilowatt hours in all communities. At present, residential consumers in communities using diesel do not receive the same level of rate relief as customers on the hydro grid. In order to ensure fair treatment, rate relief for 1997 will provide equal benefits on the first 1,500 kilowatt hours used by residential customers in any community and eliminate rate relief to power usage beyond 1,500 kilowatt hours as a way to encourage energy efficiency and conservation.

The continuation of rate relief was a commitment made to Yukon people by all three parties during the election. Our government is meeting that commitment today, but the greater challenge of improving electricity subsidies and sharing in the benefits of our Yukon-owned utility will be addressed through the policy development work of the energy commission. I expect that this program will be a subject of considerable discussion in their public consultation process.

Mr. Ostashek: I thank the Member for his statement. I am pleased to see that the present government is continuing with the program that was implemented by the Yukon Party government.

I have a few questions about the ministerial statement that was given here today. Maybe the Minister can answer the question for me in his rebuttal.

The statement says that rate relief for 1997 will be returnable at $1.6 million. I ask the Minister if he could tell us the amount of rate relief for 1996 so that we can see what the difference will be between the two years.

I am also concerned about the statement that residential customers in the communities that are using diesel do not receive the same level of rate relief as customers on the grid.

It is my understanding that all residential customers receive the same treatment for the first 1,000 kilowatt hours. That is my understanding of the program that is now in place.

I see that the Minister intends to raise this number to 1,500 kilowatt hours, and in some manner is saying that this will encourage energy efficiency and conservation.

I draw the Minister's attention to the fact that most households, especially those in rural Yukon, use less than the allotted 1,000 kilowatt hours, for which there is a subsidy in place now. In my opinion, this increase will do nothing to conserve energy. In fact, it will allow for the consumption of more energy at a reduced, subsidized rate.

I also have the concern - I am not really clear on this, so I hope the Minister can clarify it. The Minister says that everything over the 1,500 kilowatt hours will be at the regular rate. Commercial consumers now in the Yukon have a very favourable rate for the first 2,000 hours: a rate of some 7.5 cents per kilowatt. Is the Minister saying that this will be reduced now to 1,500 hours for businesses in the Yukon? If that is the intent, how does the Minister intend to do that, when the rate for the commercial users in Yukon has always been set by the Yukon Utilities Board? I wonder if the Minister could answer these questions in his rebuttal?

Mr. Cable: Rate relief came into being because of the lack of stability in the rates which, as the ministerial statement points out, came about as a result of market instability. Because of our reliance on mining, and particularly the Faro mine, for a significant part of the consumptionwe are likely going to have to live with market instability. Let me suggest to the Minister and the energy commissioner that, judging from the three principles put forward, we are going to continue to treat the symptoms of the disease, rather than the disease itself. In my view, the disease - and I put this forward for the consideration of the Minister and the commissioner - is the instability in the Yukon Energy Corporation's earnings. Every time the Faro mine, for example, comes on or goes off the system, the Energy Corporation shudders.

Let me suggest that the terms of reference be widened to deal with the instability and the earnings, and that the commissioner look at such things as a stabilization fund - which I know he has had some thoughts about previously - or a new capital injection from the government. If we continue to run down the working capital of the Yukon Energy Corporation and eventually cause the corporation to have to borrow for capital projects, we are simply going to make the underlying problem worse, and we might eventually kill the patient. So, I ask that the Minister and the energy commissioner consider widening the terms of reference.

Hon. Mr. Harding: I thank the Members for their comments. With regard to the question raised by the former Government Leader about the differences between the money returned in 1996 and 1997, my understanding is that it is fairly minimal. I will provide more exact numbers for the Member. What we are saying in this is that, beyond 1,000 kilowatt hours in a month, there will be a difference between the diesel-supplied communities and everybody else - or there was - and this rate relief program tends to or tries to equalize that somewhat.

With regard to the concerns about the commercial rates, we have only made some fairly minor changes to the program, and they are all indicated in the statement. All other concerns can certainly be evaluated through the commission. We intend to do a thorough review of the rate relief program and certainly the suggestions from the Member for Riverside for widening the terms of reference are all valid. I agree that there is some concern with regard to capital. We are interested in energy supply options, and that is a consideration to which we will have to pay attention.

So we have not closed off our minds in terms of expanding our terms of reference with regard to this program or anything else in the development of a comprehensive energy policy. I invite the Opposition to work with me and to work with the energy commissioner and the commission. There are differing points of view in the Yukon about these issues, but we are going to try and bring people together and work out answers to some of the more difficult problems that have plagued us for a very long time with regard to energy in this territory.

I thank the Members for their comments and I look forward to their continued participation in working with the energy commission on these tough issues.

Yukon Quest student home page

Hon. Ms. Moorcroft: I rise in the House today to give an address. Not an address - speech - but a home page address in cyberspace on the worldwide web:


With this address, Yukon students, and indeed people around the world, will be able, as of January 7, to visit the Yukon Quest student home page website and be welcome to YESNET's first interactive classroom project.

Dialing through space is much quicker and warmer than mushing by dog team.

Our government's policy is to encourage innovation and education and to recognize the increased importance of computer technology in today's world.

The Yukon Quest student home page is a multi-grade, nation-wide project that has been designed and administered by Yukon students and teachers. The Yukon Quest project is scheduled to run from January 7 through to February 28, 1997.

The Yukon Quest student home page contains information that has been written and presented by Yukon students on the history of the Quest, along with details about the upcoming running of the Yukon Quest dog race between Whitehorse and Fairbanks in February. Students who visit the website will also have an opportunity to ask specific questions about the race and have them answered by a Yukon Quest musher or veterinarian.

Over the next few weeks, Yukon students are invited to contribute to this website by submitting their artwork, poetry and prose. I have a copy of the leaflet for each Member, which is also available at schools. Students are asked to submit their work by December 18.

Riverdale Junior Secondary and Porter Creek Junior Secondary students will be coordinating the e-mail portion of the project.

Congratulations to the students, teachers and the information technology people at the Department of Education. I am sure that we are all proud of this project.

Mr. Phillips: I would like to congratulate the students, teachers and technology people at the Department of Education and the Minister, as well, for going ahead with this very interesting project. As Members know, the Yukon Party is the party that brought YESNET into our schools as a learning tool. It is a great learning tool. This will give students from all over the world an opportunity to learn more about the Yukon Quest and, in particular, about the Yukon and for our Yukon students to learn more about using the Net and provide information to other students from all over the world.

It is a great project, and I am sure it is just one of many that will come across in the next few years.

Ms. Duncan: I would like to join my colleagues in offering the students, teachers, the Minister and department officials who have worked on this Yukon Quest student home page our congratulations.

I do not think the authors of the song, "It's a small world after all" ever really envisioned just how small the world would be in 1996 - and getting smaller.

This website page is important for the people participating in its implementation and for the Yukon Quest, in terms of knowledge about the race and dog racing as a sport in general. It is also important in terms of winter tourism in the Yukon. I can envision a tremendous increase in requests for information from families who may travel to the Yukon as a result of students visiting the Yukon Quest home page.

Although the Minister did not state what sort of an assessment might be made of the project upon its completion, I am confident that there are indicators in place to measure the number of visitors to the home page and, I hope, the number of subsequent requests for information that are then filled by the Yukon Quest office or Yukon Tourism as a result. I look forward to an assessment of this project when it ends on February 28, and would like to wish all the participants much success or, should I say, many surfers on the Net.

Timber regulations: changes to

Hon. Mr. Harding: I am pleased to rise today in support of the changes made yesterday to the Yukon timber regulations by the Minister of Indian Affairs and Northern Development.

The Yukon government supports DIAND's proposed changes to the Yukon timber regulations. These changes will enable the Yukon forest industry to get back to work this season. The changes allow permit holders to pay their fees as they develop their permit areas instead of incurring hefty upfront fees, which prohibit some operators from gaining financing to proceed with their work. The changed regulations also implement an interim fixed-rate stumpage fee of $5.25 per cubic metre for tier 2, and $2.62 per cubic metre for tier 1 wood, to reflect current market prices for wood.

Our government has long recognized the difficult situation that the forest industry has been in, with timber regulations that are inflexible, which have made it hard for the industry to go to work. We have seen two demonstrations over the last 12 months where industry has circled the federal building in protest over the state of these regulations. Now, we have seen some change. They are not perfect, but at least they will allow some reasonable access to the resource.

I am pleased to say that we helped to broker this recent impasse with industry and DIAND. We have facilitated the meetings in Ottawa between industry, DIAND and First Nations to explain the importance of these changes to the regulations. We participated actively in the Yukon Forest Advisory Committee to make our position known. We gave our support for these directly to the Minister of DIAND.

We realize the importance of this industry to the community of Watson Lake and the Yukon as a whole. We are seeing our forest ecosystems managed by an outdated forest policy and with regulations that do not recognize the realities of our local industry. We need to have local control and input into the management of this resource, no matter who is responsible. Whether the control is federal or territorial, we all have concerns about our resource.

That is why we established the Yukon forest commission. Developing a made-in-Yukon forest policy is a high priority of this government. The Yukon forest commission will develop a comprehensive and sustainable forest policy in an open and consultative way. The commission will provide leadership within the Yukon government and work in partnership with First Nations governments, the federal government and the Yukon public to create an approach to managing Yukon forests that is acceptable to all Yukon people. Thank you.

Mr. Ostashek: Let me say that I am very happy to see the people back to work in the forestry industry in the Yukon. I am glad to see that the federal government has moved to do that. I do believe, though, that the Minister is pushing the Standing Orders in regard to ministerial statements, which are supposed to be a short, factual statement on government policy. I think he is pushing the parameters of that quite badly with his statement and trying to plagarize and take credit for something that the federal governnment has done. I am pleased to see, though, that the Minister is going to continue the hard work that was started on government policy by the former administration. When he does stand up in rebuttal, I would like him to clarify a couple of contradictory statements that have been floating around in public.

One of them the Minister is fully aware of because he made statements in this House many, many times about wanting to see a made-in-Yukon forestry policy and that nothing else would do. Yet, the Government Leader is on record as saying he is going to work with the federal government to make forestry policy for the Yukon. Which statement is true, because that is exactly what the Yukon Party government was doing: working with the federal government to find a policy that involved all stakeholders in the Yukon and would serve the needs of Yukoners.

I would say to the Minister at this time that the best thing he could do is convince his leader to move swiftly on devolution and transfer all land and resources back to their rightful ownership: the Yukon people.

Ms. Duncan: I am pleased to offer, as the Liberal critic for Renewable Resources, a response to the Minister of Economic Development on changes made to the Yukon timber regulations.

Yukon Liberal Party policy recommends that the Minister of Northern Affairs use a portion of the stumpage fee to establish a dedicated fund to be held in trust for the Yukon government in establishing a meaningful silviculture program for the Yukon. That policy recommendation speaks to the renewal of the resource, which is not mentioned in the ministerial statement. As the Minister has noted, the regulations are not perfect.

The Minister has also noted that, most importantly, we have seen a change that will allow more reasonable access to a Yukon resource. This change is a mediated change and we congratulate all the parties involved on their efforts.

We, too, are pleased that the change has occurred and that it was able to occur by the cooperation of everyone involved. We are pleased to see that the parties have worked out an arrangement that will enable the forest industry to get back to work. We do not need another temporary closure in the resource extraction industry.

The last few years have shown - and I am not criticizing any officials when I make this statement - that the best administration is the one that is closest to the users of the service. It is clear that the forest resource will be best run in the Yukon by Yukoners under a made-in-Yukon forest policy. That will happen when devolution has been obtained.

The Government Leader spoke briefly yesterday on the devolution of the oil and gas resource. It will be useful to be updated on the devolution of the forest resource. Has the government had time to set a target date and will it advise the Yukon public of this?

Hon. Mr. Harding: The former Government Leader still seems to be a little bit bitter about the whole forestry question.

I would say to him that this is a statement of policy on behalf of this government. It is our policy to work with industry, conservationists and other Yukoners in the development of a made-in-Yukon forestry policy.

This statement clearly explains some of the initiatives that we undertook to work very diligently, along with industry and YFAC, to broker the arrangement that is getting some people back to work in Watson Lake, as we speak. We are proud of that and we will continue to take that approach.

We believe that there is room for environmentally responsible logging and for protected spaces in the Yukon Territory. We also believe in localized industry with value added.

The previous Government Leader talked about the hard work that was done by the Yukon Party.

When the people of Watson Lake came to the previous Yukon government to get a little bit support to try and lobby the federal government so that they could go to work, the Yukon Party government told them that they could not get involved, because it was a federal issue.

At a public meeting the Government Leader said that he did not want the federal Minister to get mad at him, that if he became involved with the issue the federal Minister would get mad at him.

The people of Watson Lake received no support from the Yukon government under the previous administration.

Group by group, from industry to conservationists, to First Nations and everyone one else, when the previous administration was developing its made-in-the-Yukon forestry policy, came out saying that the process and the product were flawed. That was not a statement that was invented by the Opposition; that was a fact.

We decided that we would take a different approach. We would try to bring government-to-government relations together, cooperate with the federal government - who are still the stewards of the resource, whether we like it or not - and be proactive in developing a made-in-the-Yukon forestry policy. We have made some progress on that already.

With regard to devolution, the former Government Leader tells us to move swiftly. How many programs were devolved over the last four years to the Yukon Territory under the approach of the Yukon Party, which was to ram it down everyone's throat, including First Nation governments.

Point of order

Mr. Ostashek: Point of order, Mr. Speaker.

Speaker: Member for Porter Creek North on the point of order.

Mr. Ostashek: I think the Member is straying a lot from replying in rebuttal to his ministerial statement.

Speaker: The Minister of Economic Development, on the point of order?

Hon. Mr. Harding: Mr. Speaker, I would submit to you that there is no point of order and that I am simply responding to issues raised, as is my right under the Standing Orders. I believe that this is a disagreement between two Members.

Speaker: I do not see any point of order, so the Minister should conclude his statement.

Hon. Mr. Harding: As I was saying with regard to devolution, there was very little progress made under the previous administration. We are trying to work cooperatively with First Nations on their devolution concerns, so that we can present a more united presentation to Ottawa. The Yukon Party's approach to resolving the forestry issue in the Yukon was to offer a $1 million stumpage subsidy to the logging industry and to hire an American mediator during the election campaign. They threw up their hands and said there was nothing more they could do about it.

We are going to take a different approach. We are going to take a sustainable approach. The forest commissioner has already had numerous meetings with industry, conservation groups and First Nations to talk about these initiatives and to develop this policy. I think the Yukon public will see, over the next couple of years, that we can achieve good results in this territory by working together on a government-to-government-to-government basis and involving the Yukon people.

Speaker: This then brings us to the Question Period.


Question re: Land claims negotiation plans

Mr. Ostashek: My question is for the Government Leader in his capacity as Minister responsible for land claims.

The Government Leader has stated repeatedly in this House that everything is proceeding normally and swiftly at the Land Claims Secretariat, that morale is good, lots of work is being done and, in fact, there is going to be a major expansion of staffing to take them up to seven tables. Can the Government Leader explain to this House why, at the land claims table, one of the key players - namely, the federal government - the chief federal negotiator, is completely in the dark about the Yukon government's plans?

Hon. Mr. McDonald: I do not think the Member is fairly characterizing the federal government negotiator's position on this matter. I have had a number of meetings with the federal government's negotiator to indicate that we are interested in increasing our activities in land claims, acknowledging that there are some severe deadlines facing us at the land claims table. When the assumption is made that there may be seven tables going at once, it does not mean there will be seven negotiating teams - it means there may be seven tables going at once. With respect to the increase in staff, I am certain that the federal negotiator does not know who the increased staff are going to be, because I do not know either. Certainly, when the time comes, there will be good communication between governments with respect to the actual individuals involved. I have indicated that we are interested in increasing our activity and, as far as I am aware, he also indicated to me, and to others, that he thinks the activity is going to have to be increased as well.

Mr. Ostashek: That is certainly odd, because he said to the press yesterday that the only increase he was aware of was the increase that took place in the last budget on agreement between me and the federal Minister, where we increased some staffing and the federal government increased some staffing.

Could the Government Leader explain to this House how it is that the Yukon government is going to have the ability to staff seven negotiating tables, whereas the chief land claims negotiator for the federal government said yesterday that the federal government, with all its resources, did not have the ability to staff seven tables?

Hon. Mr. McDonald: I realize the Member is reading the question, but if he had heard my answer he would have already received the answer.

I have already indicated to him that the Government of Yukon is going to increase its activities. It will not have seven principal negotiators - it does not need seven principal negotiators - but it does need to have a sufficient number of principal negotiators who can share files to ensure that seven tables can be operating at once. Even the previous government, the Member's own government, had two principal negotiators and yet they had more than two tables operating at once. There does not have to be one principal negotiator per table.

As I have indicated to the federal people, and as I have already indicated today, we will have sufficient numbers of principal negotiators who can handle a number of files - not too many files, but a number of files - so that they can respond actively and diligently to the number of tables we anticipate will be coming forward in the next year.

Mr. Ostashek: I do not think the Minister is paying very close attention to the question. I never spoke at all about principal negotiators. I never mentioned that at all. I said "personnel". The federal government said quite clearly yesterday that it does not have the personnel. It had nothing about principal negotiators, but this government seems to think it has. So, I ask this government: since land claims personnel requires some expertise as well as extensive knowledge of local issues about the territory, could I ask the Government Leader if he is prepared to table in this Legislature a list of the personnel who are going to be on the Yukon government negotiating teams, or is this just a whole scam?

Hon. Mr. McDonald: A scam?

Let me point out a couple of things to the Member. First of all, the Member has had me answering questions about reports in the media almost all week. It is almost as if there is only one source of information from which the Member is drawing his Question Period material.

With respect to the land claims negotiating tables, we anticipate that there is going to be heightened activity. Why is there going to be heightened activity? There is going to be heightened activity because there are seven outstanding First Nation final agreements that have to be negotiated. Why? Because there was very little work done to actually complete those negotiations over the last four years. Consequently, we are faced with a dilemma. The dilemma is that we have to do a lot in a very short time.

If it had been my choice, we would have been able to negotiate in a leisurely fashion with fewer people. Unfortunately, I am faced with a February 14 deadline. We have a brand new government with many things to do. We must increase activity in the Land Claims Secretariat. There is no doubt about that. We must be able to respond effectively to whatever negotiating tables come forward. It does not mean we will have seven separate and distinct negotiating teams for each table. It means that we are going to have principal negotiators who can handle a number of files. We want to have a sufficient number of principal negotiators so that they can respond effectively to whatever comes forward.

That is our commitment as a partner to the negotiations. That is what we will do.

Question re: Land claims negotiation plans

Mr. Ostashek: It is little wonder that the staff of the Land Claims Secretariat is demoralized when the Government Leader stands up time and time again and says that they did nothing for the last four years. It is a ridiculous statement and he knows it. There were major accomplishments in those four years and a lot of hard work done, of which the benefit will be reaped by his government.

I take exception to the Member saying that he can set up all these tables when there are currently about 20 staff members in the Land Claims Secretariat to operate the two main tables that we had going while the subsidiary tables were talking about other issues. Where does the Government Leader propose to get the people to approximately double the size of the Land Claims Secretariat to carry out what he is suggesting when t

he federal government totally disagrees with him. It says that the government cannot do it.

It does not matter if I got it from a news report or somewhere else, the fact is that the federal government is on public record as saying it cannot be done. Can the Government Leader tell me where these negotiators are going to come from?

Hon. Mr. McDonald: There is so much to respond to, I will have to probably take it piece by piece.

First of all, the Member has already interpreted the chief federal land claims negotiator's remarks as being in total disagreement with the Yukon government. That is quite a stretch. To my knowledge, it is certainly not the case.

Secondly, he has indicated that the Land Claims Secretariat is completely demoralized. As far as I am aware, that is not the case.

He indicated that the Yukon government is going to benefit from all the good work done by the previous government, which is interesting, given the number of tables that have yet to come on stream that have not even begun negotiating.

Nevertheless, having responded to some of that, knowing that there is going to be increased activity - because there must be, although I will not go into the reasons for that once more - our commitment is that we are going to be sufficiently staffed to be able to handle increased activity at the land claims table if people come forward to negotiate. I know that they are all tooling up for that.

I do not believe that it will require a doubling of the size of the Land Claims Secretariat. I do think that it is going to require another principal negotiator and a couple of staff. I do think that we are going to be prepared and ready to respond to those land claim negotiating needs.

The Member does not have to use extreme language to get his point across - if he ever had a point. I can assure the Member that this is a top priority for us, because there are some very significant deadlines in the umbrella final agreement that we simply must respond to.

Mr. Ostashek: Maybe we would not have to ask so many questions if we could get some answers instead of political rhetoric from the other side of the House.

The Government Leader says that the morale in the Land Claims Secretariat is good, yet his deputy minister says that it is "pretty low." There seems to be another difference of opinion. There is no communication.

In view of the fact that he is going to be hiring new people - and I have not seen any advertisements for these jobs - how are these positions going to be filled?

Hon. Mr. McDonald: They are going to be filled in the standard recruiting practice of the government. They are going to be identified by the public service. There are going to be recruitment processes in place as there always has been. Certainly, there is every chance that we can fill these positions by early spring. It may not be in time for February 14.

We recognize that no matter how hard we work - the government, the Land Claims Secretariat and everyone involved - we cannot achieve the First Nation final agreements by the deadline, largely because there was so much dead time, frankly, in terms of the actual negotiating activity, which has put us behind the eight ball. Now we are stuck and must respond, and we must do so aggressively.

Mr. Ostashek: That is the whole problem. This is the same Government Leader who sat in this House a few days ago saying that the changes were being made because they had to meet this February deadline. That was the rationale for all the commotion that he caused in the Land Claims Secretariat. People had been removed and they had not been removed; they are not negotiating, yet they are still negotiating. We will get to that debate in Committee of the Whole and find out exactly what is going on.

It is patently obvious, to use the Minister's terminology, that the seven-table concept is totally unrealistic. Would the Minister stand up and tell this House how many land claims agreements he can reasonably expect to have settled by the deadline date?

Hon. Mr. McDonald: I do not know and, frankly, I resent the notion from the previous Government Leader, who was largely, in my view, responsible for the current situation with land claims because he was the responsible Minister for four solid years. I resent the fact that he is now trying to hold me to a date of two months from now to complete seven final agreements when he could barely complete three and, as a matter of fact, did not complete three in four years. I think it is completely ridiculous.

I appeal to the Member - perhaps it is common sense, if nothing else - to put the challenge to us that everything has to be done before February 14 is unrealistic.

I have said, however, that the deadline of February 14 is a deadline that we must respect, because after this date, First Nations will be paying significant penalties. We do care about that, incidentally. We do care about that, because the First Nations people with whom we are negotiating are Yukoners, too. It is going to compromise their agreements to have to pay these penalties. Once we reach that deadline, then we start negotiating from a very, very difficult position, because, for every day that we use after that, somebody in the Yukon pays. We care very much about that.

Question re: School discipline policy

Ms. Duncan: Violence in our schools is a many-faceted subject, and it is not restricted to any one Whitehorse school or, indeed, any one Yukon community.

I would like to ask the Minister of Education about the discipline policy. Porter Creek Junior High School has an excellent general discipline policy that is given to each student. I understand that other schools have borrowed that policy when working on their own. Individual school discipline policies are an excellent approach; however, we run into difficulty when a student transfers between Whitehorse schools.

Would the Minister advise us what steps the department is taking on a general discipline policy, and whether or not it is being done in consultation with school councils?

Hon. Ms. Moorcroft: As far as I am aware, the discipline policies are developed at each school, with the school councils involved. I am certainly aware of many schools around the territory that have discipline policies, like the one at Porter Creek Junior High School, to which the Member has referred.

Ms. Duncan: I did ask if the Minister was aware of the development of a general discipline policy; h

owever, I would like to ask, if I may, about the task force to promote safe schools report and the interagency steering committee.

Can the Minister advise us of the progress of the formation of the interagency steering committee, how it might be reporting, and its time frame?

Hon. Ms. Moorcroft: I would be happy to answer the Member's question.

There was a transcript for the safe schools forum that was held on November 4, which was mailed out to all the parents and people who had attended and who had requested copies of the transcript in December - earlier this month. Work is proceeding on the formation of the interagency steering committee. At the present time, the target date is mid-January.

Ms. Duncan: With respect to the promotion of safe schools, at the November 4 meeting and in the task force report, there is no mention I can see of safety audits. For the benefit of those Members who may not be aware of what safety audits are, they deal with things like building lighting, and so on, and promote a safe atmosphere within a school. Again, Porter Creek has had an excellent safety audit done, and it is being implemented in the construction of the new building.

Why was consideration not given to safety audits by the task force? It is not mentioned in the report. Can the Minister advise which schools in the Yukon have had safety audits, and where they are in implementation?

Hon. Ms. Moorcroft: I will have to get back with the information on which schools have completed safety audits. I know some have. The Member is also probably aware that there is a safe schools coordinator, who has been hired and is working for the department on issues like this, and I will provide full information to the Member.

Question re: Yukon Energy Corporation award

Mr. Cable: I have some questions for the Minister responsible for the Yukon Energy Corporation.

As the Minister may be aware, the two utilities - the Yukon Energy Corporation and the Yukon Electrical Company Limited - received an award from the Public Utilities Board in the amount of $1,950,000 about three weeks ago. This resulted from an issue that had been raised before the board and had gone to the court of appeal. They had obtained a favourable judgment, and it had come back to the Utilities Board.

The utilities had been given three options to recover this money by the end of 1997, one of which was to raise the rates by four percent.

Is the Minister aware of the intention of the utilities? Do they intend to raise the rates by four percent to recover this nearly $2 million?

Hon. Mr. Harding: As a new Minister in this department, which is incredibly complicated, I have taken some time, given the impact of some of these decisions, to get myself tooled up and do a bit of analysis of the options available. The particular issue the Member is raising is still one of those issues that is under consideration. It is certainly a matter that the Yukon Energy Corporation is well aware of in terms of its impact on consumers and on the people who pay electricity bills, so it is an issue on which I hope to be providing more details to the Members opposite and to the public in the near future.

Mr. Cable: As the Minister is undoubtedly aware, the method of recovery may have some bearing on the rate relief program.

Is the Minister prepared to commit to determining what effect, if any, the four-percent rate increase - if, in fact, that is the option that is pursued - will have on the rate relief program, and advise this House, before the supplemental budget debate is concluded, as to whether further funds will be needed from the taxpayers?

Hon. Mr. Harding: I assume the Member means ratepayers and not taxpayers in his question.

That is certainly one of the options we are considering. We are looking at considering all the options with regard to the three matters put before us by the Utilities Board.

In terms of its impact on rate relief, I will do my best. If that particular option the Member suggests is considered, I will do my best to get it back to him, but I want to stress to him that no decision has been made on that as of yet.

Mr. Cable: No. The question I was asking the Minister - as he is probably aware, the taxpayers backstopped the rate relief program; if, in fact, they are going to be called upon to backstop the program, instead of taking the working capital from the Energy Corporation, it would be useful to know if there is going to be any significant charge in this present fiscal year before we conclude the supplemental debates. Can the Minister do an initial appreciation - if the Energy Corporation proceeds with the four-percent rate increase - there will be a call upon the taxpayers?

Hon. Mr. Harding: It is very hypothetical at this point but, in the interests of good contingency planning, I will endeavour to bring back some information for the Member. As I said before, no decision has been made on this yet, and I will try and bring some more information back for him before we leave the House for the Christmas season.

Question re: School violence

Mr. Ostashek: I also have a question for the Minister of Education about school violence.

The Minister will recall that just prior to the election there was a very serious incident of school violence at Porter Creek Junior High School where two students ended up at the emergency ward of the hospital.

There were some actions taken. Instructions were given to the Department of Education at that time to try to give some comfort to parents. There were security patrols put on for a few hours a day at the school. The department was supposed to consult with the City of Whitehorse to find out whether or not the trees could be moved back from the parameter of the schools so that supervisors could have a better view of the students when they were outside. Also, the department was going to look into the feasibility and the cost of fencing. Could the Minister bring us up to date as to what is happening with those initiatives?

Hon. Ms. Moorcroft: As the Member knows, there has been a lot of work done in responding to the problem of violence in the schools and violence in the community.

The Department of Education has ongoing work on setting up an interagency steering committee. They are working with the City of Whitehorse about the removal of trees around the school. I can provide a more complete answer to the Member later on.

Mr. Ostashek: I really would like to know if security is still in place or not. It is my understanding - I do not know if it has happened in that school - that there have been acts of violence in other schools that have been fairly serious.

When does the Minister expect that she will be able to get back to me with an update on those initiatives?

The Minister said there was a school meeting in Porter Creek. I draw the Member's attention to the fact that she was at the meeting. There were some very disappointed parents who have spoken to me since that meeting, who feel that the government is trying to sweep the issue of school violence away, and are not treating the issue as seriously as parents feel it should be. The forum for the meeting in Porter Creek was advertised not as violence in the schools but referred to something about safer communities. Many people did not even attend the meeting because they thought it was a Neighbourhood Watch meeting.

Could the Minister bring us up to date on that?

Hon. Ms. Moorcroft: I believe that the people who attended the meeting found it to be a very productive forum.

I think we have to recognize that we cannot simply rely on teachers and on the education system to deal with the problem of violence. We all have to deal with the issue, and that is exactly what is going on with volunteers from the community and with the establishment of the interagency steering committee.

To return to his comments about the Porter Creek school in specific, there was a safety audit done at that school. Other than the trees, there was no mention of his other suggestions. I will get the information from the department and hope to bring back an answer for the Member tomorrow.

Mr. Ostashek: I thank the Minister for that. I want to indicate to the Minister that we are not trying to lay blame. We are not saying that the ongoing work to try to solve the problem of violence in our society is not work that is well-founded, and it will pay dividends in years to come. Right now, we have some good parents who are very, very concerned about sending their children to school and students who are concerned about going to school. What can the Minister tell the House today to give these parents some level of comfort that their children are going to school in a safe environment?

Hon. Ms. Moorcroft: I can tell the Member that the teachers in our schools are working very responsibly to make sure the schools are safe. I can tell the Member that this government is continuing the work on the safe schools policy. As I mentioned in response to a previous question, we have a safe schools coordinator who is working with schools and on accreditation, which often includes safety audits, if they have not already been done. This is a problem that we are working very hard to address; I can reassure the Member of that.

Question re: Animal protection

Ms. Duncan: The former Minister of Justice was to have struck an interdepartmental committee to examine the regime of legislation in the area of animal protection. I would like to ask the Minister of Renewable Resources in the current government this: assuming that the committee was struck, has that work been concluded and would the Minister advise the House of the results of that committee?

Hon. Mr. Fairclough: No, I have not received the final results, so I cannot bring that forward.

Ms. Duncan: I would like to ask the Minister then, if he envisions bringing something forward to this House in the area of animal protection legislation?

Hon. Mr. Fairclough: I believe that the animal protection work is being led by the Department of Justice.

Ms. Duncan: Can I ask the Minister of Justice if she anticipates bringing animal protection legislation to this House? If so, when, and will it be an omnibus bill?

Hon. Ms. Moorcroft: The issue of animal protection is one that we take seriously, and it is something that we will be looking at. The spring legislative session will be mainly a budget session. We are working presently on a legislative calendar. In the fall, we will be bringing forward various pieces of legislation. An animal protection act may be one of these, but I cannot give the Member a complete answer until we have worked in our Cabinet and with the involvement of the Department of Renewable Resources, as well.

Question re: School violence

Mr. Phillips: I have a question for the Minister of Education regarding violence in the schools as well.

I attended the forum the Minister attended on safer neighbourhoods held at the Jack Hulland Elementary School on November 4. Many parents expressed concerns about the increased violence in our schools. Since then, questions have been raised about what is being done for the victims of violence and what resources are being made available for those who are victimized. Concern was also expressed that there did not seem to be any acknowledgment that the acts of violence in our schools are occurring in some cases and that students have been victimized.

Can the Minister tell the House today what actions have been taken to recognize the concerns expressed by these victims?

Hon. Ms. Moorcroft: There have been a number of actions taken, as I have indicated in response to a couple of other questions on the same subject.

There is a plan to bring the safe teen program to the territory again. The former Minister would be well aware of this program, since it first happened under his ministry. There is a non-violence crisis intervention program that will be offered in January. There is a proposal in progress to have all staff in all schools participate in this program on a rotational and ongoing basis.

Mr. Phillips: One of the concerns expressed to me by many of my constituents and some people at the meeting that night was the concern that the limits the Education Act puts on discipline in the schools. The parents and the teachers feel somewhat tied by that piece of legislation. I know that in the legislation there is to be a 10-year review of the legislation. As we all know, it is not perfect. Like all pieces of legislation, once they are tabled and go to work we find that there are flaws in them.

I would like to ask the Minister if she would consider, after six years under the Education Act, going back to the public for a review of the Yukon Education Act to make improvements in the areas that I have just mentioned?

Hon. Ms. Moorcroft: There is a lot of work that remains to be done to bring the realities and the principles of the Education Act into play in the schools and communities around the territory, and we are committed to doing that.

Mr. Phillips: That was a nice statement by the Minister, but it did not answer my question. My question was that it has been six years. In my tenure as the Education Minister, and of our last Education Minister, there were some areas of minor amendments, but there now appears to be areas of major amendment with respect to discipline. I know a lot of people have strong concerns and would like an opportunity to express those concerns. I think it is timely that the government bring forth the Education Act in a review - a six-year review would not be unusual - and let the public state its views on the pros and cons of the Education Act and on how well it has or has not worked.

Will the Minister give us a commitment on the floor of the House today that this government will initiate a public review of the Yukon Education Act?

Hon. Ms. Moorcroft: I am certainly willing to consider the Member's suggestion. I would point out that one of the reasons there is a lot of work to be done to implement the Education Act is because the previous administration did not respect the partners in education as it should have done, and did not work collaboratively with the teachers and with school councils.

There is a serious concern about discipline policies. I believe the department has a responsibility to set an overall framework about discipline policies. However, the research indicates that school-based practises tend to be most effective. There are school safety committees in place; there are school councils. I would encourage all parents who are concerned to attend their school council meetings, to meet with the school administration and teachers, who are always happy to talk with parents, and use those avenues that are available to them.

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


Speaker: Government bills.


Bill No. 21: Third Reading

Clerk: Third reading, Bill No. 21, standing in the name of the Hon. Mr. Harding.

Hon. Mr. Harding: I move that Bill No. 21, entitled An Act to Repeal the Public Sector Compensation Restraint Act, 1994, be now read a third time and do pass.

Speaker: It has been moved by the Hon. Minister responsible for the Public Service Commission that Bill No. 21, entitled An Act to Repeal the Public Sector Compensation Restraint Act, 1994, be now read a third time and do pass.

Hon. Mr. Harding: I thank the Speaker. As I said before, I forgot to move the motion. I am not going to speak too long on this. It is the third reading of this bill, and I made a lot of comments in second reading about the pleasure that I have today to stand in this Legislature and restore the process of collective bargaining to its rightful place in this territory, which is sitting down at the bargaining table in the process of free collective bargaining with the Yukon Teachers Association and the Public Service Alliance of Canada.

We made a commitment in the election campaign to repeal the legislation. Our platform, A Better Way, said that we would, at the earliest opportunity, (a) begin negotiations with the public service unions on new collective agreements to reflect current labour conditions, and (b) repeal territorial Bill No. 94, which ended free negotiations. We have made a priority in this short sitting of the Legislature to do just that - to move it through very quickly. It was one of, if not the very first order of business for us, and we have that kind of commitment of getting down to the table and bargaining a negotiated collective agreement. I have met with the YTA concerning this subject. I have met with the Public Service Alliance of Canada.

Regarding issues that have been raised about retroactivity and about reinstatement of rollbacks by some Members and by the Opposition, we were very careful in the election campaign to be clear about our commitment to sit down at the bargaining table to discuss those issues in the appropriate place. We knew that the previous administration had spent the $10 million that was taken from the employees with their Public Sector Compensation Restraint Act, 1994, so we knew that that money was gone. Nonetheless, we were very committed to sit down at the bargaining table and negotiate issues that are of importance in the true spirit of free collective bargaining.

One of the other aspects of the move we have made is to go a little further. In the election campaign, the previous administration agreed to go back to collective bargaining retroactive to June 30, 1996, with the YTA and to March 31, 1997, with the Public Service Alliance of Canada. We felt that it would not be appropriate for us to continue to leave the effect of the wage restraint legislation hanging over the Public Service Alliance of Canada any longer than it already had been. This legislation makes anything that they negotiate retroactive to the date of proclamation of Bill No. 21, An Act to Repeal the Public Sector Compensation Restraint Act, 1994.

That is an important initiative and one that I think we can say is a positive step to putting this chapter behind us. That is not to say that there are no tough fiscal realities - these are times of restraint. There are a significant amount of issues that are going to have to be dealt with, and I think the negotiations will possibly be quite tough. I think that if we bring that true spirit of free collective bargaining to the table, we should be able to overcome many issues that are of importance to all parties.

I also want to say that with regard to the effect or the length of the time that the parties have remained under the compensation, by passing the bill some time in December, the Yukon Teachers Association and the Public Service Alliance of Canada both remain under the umbrella of wage restraint for a similarly long time - about 24 months, give or take a few days. I believe if we pass the bill on December 31, it will be exactly 24 months. I think that that is an important point to make.

With regard to category 3 employees, which are the Cabinet, management and caucus employees, they do not collectively bargain. If there are any changes to their wages, it is done through order-in-council by government policy directives.

What we are doing with Bill No. 21 is repealing the Public Sector Compensation Restraint Act, 1994, and reinstating the process that we committed to very clearly in the election campaign.

I look forward to fruitful negotiations with our employees with the proclamation of this bill. It is my sincere hope that we restore some of the relationships that were damaged or burned when there was an unnecessary bill brought before this House to remove their right to free collective bargaining. I want also to commend the Public Service Alliance of Canada and the Yukon Teachers Association for their cooperation and their patience with the Yukon government - generically - as we put this chapter behind us. I commend this bill at third reading to the Legislature.

Mr. Ostashek: I will be fairly brief on this bill, but there are a few things that need to be said for the record.

The Minister could have had this bill through a couple of days ago, had he brought a simple bill into the Legislature, without having to bring lawyers in to try and explain the clauses. Nevertheless, we, too, are glad and happy to see that we are going back to collective bargaining. It was through the good fiscal management of a Yukon Party government that has put us in the position where we can now return to collective bargaining some 12 months earlier than we anticipated in those dark, dreary days when we took over from an NDP government that had broken the piggy bank.

The Member said they were careful to draft the bill so that they would not have to pay the unions retroactively, because they knew that we had spent the $10 million. Mr. Speaker, I say to you, and I say to the Member opposite, that we would never have put in the wage restraint if we had not needed the $10 million. Why would we do that and put the money in the bank? I do not follow the rationale of the Member for that, but, nevertheless, I think it was probably a political shot that he wanted to take - so be it.

I do want to thank the unions and all Yukoners who cooperated with us in a time when the future of the Yukon did not look as bright as it does today. We have the Faro mine shutting down, but because of the diversity of the economy and the fact that several more mines are working and coming on stream - I hope that the Faro mine will reopen, but in the unlikely event that it does not, we are in a better position financially to face whatever comes at us now.

We, too, support this bill. We said, during the election campaign that we would act in a similar manner as this government has, as did the Liberals. We have the bill through now, and I hope that we have some fair and productive collective bargaining.

Mr. Cable: As the previous Member has indicated, all of the parties put forward in their platforms during the election campaign that it was their intention to repeal the legislation.

I have to say that I am pleased to see that the government put the issue near the top of its priorities and brought the bill before the House at its earliest convenience.

It was clear that collective bargaining was going to be restored early on and the government has performed on that part of its platform and is to be congratulated.

I was also pleased to see that, while we had some skirmishes, which I think were quite legitimate, about how the bill was presented, we did work it out rapidly, and in the final result we put the people in the two unions ahead of our own political interests.

I would like to thank all of the Members for moving quickly on this matter and working out a piece of legislation that was badly needed.

Speaker: If the Minister for Economic Development now speaks he will close debate. Does any other Member wish to be heard?

Hon. Mr. Harding: We brought forth a simple bill, one that was easy to read. As I told the Members last night, clause 1 could have been the only clause in the bill. Clauses 2, 3 and 4 were put into the bill to make it clear to the general public just what the impact of the repeal was, and I provided the Member for Riverside with actual legal confirmation of that.

I also want to say that we kept our election commitments. I am very proud of that. I did not want to have to say this, but I must say that I have to take exception to the former Government Leader's version of reality. It is clear that the books were cooked in 1992.

This year we have inherited from the Yukon Party a $35 million current year deficit, but are we standing here saying that we are going to take away employees' rights to free collective bargaining? No. Are we spending $100,000 to try and make the previous government look bad? No. What we are doing is sitting down with our employees; we are going to talk with them and we are going to freely collectively bargain.

With regard to money in the bank, I would point out that in the 1991-92 year-end public accounts there was a $51 million accumulated surplus, similar to the $59 million that was reported for the last year with regard to the state of the bank account as the Government Leader pointed out.

Yukoners remember that on the day this bill was tabled, the government announced a $20 million surplus, so they cannot legitimately tell Yukoners that this was done for financial reasons. As much as the previous government tried to do that, only the most staunch, right-wing Conservatives in this territory would believe it.

The reality is that the previous government had very little respect for the institution and the fundamental right in this country for free collective bargaining. They have never yet received the point: this was not about the two percent, but about the right to freely collectively bargain. That right was abrogated, with no reasonable justification. I think that is an unprecedented act in this country since the right to collective bargaining has come to pass.

Any other jurisdiction that has done this has had at least some justification - billions of dollars in real debt, not phony debt that was contrived to try and embarrass the previous government. It should also be pointed out that the previous government kept spending. They said they had wrestled the bull down, that they had taken the debt by the horns. They spent consecutively bigger and bigger budgets, to the point where this year they have spent over $500 million.

So, the previous government did not make the tough choices. It took the easy route. Fortunately, in this territory, the people spoke and they decided that that was not going to be a route they wanted to take. I would say again that I commend this bill on third reading to the Legislature. I want to get the process of collective bargaining restored, as we said we would do. I think it will be a good day for Yukoners, and hopefully will go some way to ensuring that our employees know that this government cares about the right of free collective bargaining.

Motion for third reading of Bill No. 21 agreed to

Bill No. 2: Third Reading

Clerk: Third reading, Bill No. 2, standing in the name of the Hon. Mr. McDonald.

Hon. Mr. McDonald: I move

THAT Bill No. 2, entitled Fourth Appropriation Act, 1995-96 be now read a third time and do pass.

Speaker: It has been moved by the Hon. Government Leader

THAT Bill No. 2, entitled Fourth Appropriation Act, 1995-96 be now read a third time and do pass.

Motion for third reading of Bill No. 2 agreed to


Clerk: Motion No. 4, standing in the name of the Hon. Mr. Harding.

Motion No. 4

Speaker: It is moved by the Hon. Government House Leader

THAT the Hon. Speaker, pursuant to Standing Order 45(2), be appointed Chair of the Members' Services Board;

THAT the Hon. Piers McDonald, Hon. Trevor Harding, Jack Cable and John Ostashek be appointed to the Members' Services Board;

THAT the Board consider:

(1) budget submissions for the following votes:

(a) Legislative Assembly,

(b) Ombudsman (including Information and Privacy Commissioner), and

(c) Conflicts Commission, and

(2) policy questions concerning matters such as:

(a) space allocation,

(b) staffing,

(c) caucus funding,


media gallery house rules,

(e) seating in the Assembly, and

(f) Hansard, and

THAT the Board fulfill its statutory responsibilities, including those in the Ombudsman Act, the Conflict of Interest (Members and Ministers) Act, and the Legislative Assembly Retirement Allowances Act, 1991.

Motion No. 4 agreed to

Clerk: Motion No. 5, standing in the name of the Hon. Mr. Harding.

Motion No. 5

Speaker: It is moved by the Hon. Government House Leader

THAT the hon. Members Trevor Harding, Sue Edelman, Doug Livingston, Gary McRobb and Doug Phillips be appointed to the Standing Committee on Rules, Elections and Privileges;

THAT the said Committee have the power to call for persons, papers and records and to sit during intersessional periods; and

THAT the Clerk of the Legislative Assembly be responsible for providing the necessary support services to the Committee.

Motion No. 5 agreed to

Clerk: Motion No. 6, standing in the name of the Hon. Mr. Harding.

Motion No. 6

Speaker: It is moved by the Hon. Government House Leader

THAT the hon. Members John Ostashek, Eric Fairclough, Todd Hardy, Gary McRobb and Pat Duncan be appointed to the Standing Committee on Public Accounts;

THAT the said Committee have the power to call for persons, papers and records and to sit during intersessional periods; and

THAT the Clerk of the Legislative Assembly be responsible for providing the necessary support services to the Committee.

Motion No. 6 agreed to

Clerk: Motion No. 7, standing in the name of the Hon. Mr. Harding.

Motion No. 7

Speaker: It is moved by the Government House Leader

THAT the hon. Members Dave Keenan, Peter Jenkins, Trevor Harding, and Jack Cable be appointed to the Standing Committee on Statutory Instruments;

THAT the said Committee be empowered to sit during intersessional periods;

THAT the said Committee review all new regulations as they are published;

THAT the said Committee review such other existing or proposed regulations as are referred to it by the Assembly; and

THAT the Clerk of the Legislative Assembly be responsible for providing the necessary support services to the Committee.

Motion No. 7 agreed to

Clerk: Motion No. 8, standing in the name of the Hon. Mr. McDonald.

Motion No. 8

Speaker: It is moved by the Government Leader

THAT it is the recommendation of this Assembly that the hon. Members Piers McDonald, Trevor Harding and Lois Moorcroft be appointed to the Advisory Committee on Finance and that the hon. Members David Sloan, David Keenan and Eric Fairclough be appointed as alternate members of the same Committee.

Motion No. 8 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.

Motion agreed to

Speaker leaves the Chair


Chair: I will now call Committee of the Whole to order. At this time, we will now take a short break.


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

Bill No. 3 - Second Appropriation Act, 1996-97 - continued

Chair: We are dealing with Bill No. 3, Second Appropriation Act, 1996-97. Is there any further general debate?

Mr. Ostashek: Perhaps I could make a comment, just before we get back into general debate on the main supplementaries. I wrote a letter to the Government Leader a couple of weeks ago, asking him for some information on the commissions, organization charts for staffing upstairs, terms of reference for the commissions and some stuff that would help us expedite the debate when we get to the Executive Council Office. Can the Member let me know if we will be able to have that information before we get to that debate?

Hon. Mr. McDonald: I am prepared to answer all the questions the Member asked in debate.

Mr. Ostashek: I thank you. I understand the Member will be able to answer the questions but it would have helped if we had had something to look at before we got to that section. At any rate, we will make do the best we can.

Just before the close of Committee last night, the Member put some comments on the public record that I would like to go back to review. I do not want to pick a fight with the Member opposite but we do need some clarification on some things. I would like to just go back over to where the Member stated that by the actions in other jurisdictions, namely the reduction of taxes in British Columbia, New Brunswick, Ontario, and now quite possibly Quebec, the territory would be pushed closer to the national average. That was the issue I was driving at. The Member, like I, believes that Yukoners should remain in the lower one-third of the placement of taxation in the country because of the high cost of living in the north, and if we just accept that we are going to be moved toward the national average because of cuts in other jurisdictions and are not prepared to do anything about it, it will not be very long before we will be above the national average.

We will, in fact, be putting our businesses and our mines and everything else in an non-competitive position within the mosaic of Canada because, as I understand it, even with the modest cuts that have been made so far in Ontario to date will, in fact, give the Yukon about $1.5 million in extra revenue this year without raising any taxes of our own or anything else. It will be automatic because the reduction of the national average will give us about $1.5 million extra in taxes. Does the Minister agree with that?

Hon. Mr. McDonald: I am not entirely sure of the point the Member is making, but I can tell the Member that we will take into account what I would refer to as a tax-burden calculation, which I will ask the Finance department to be calculating in the next little while once again. I would ask him to take into account, not only the tax rates, but also the cost of living in the Yukon to determine what the total impact is on people's lives. That will help us determine what we would do with a tax structure. Obviously other things will help us determine the question, too - whether or not we can maintain basic levels of service and meet basic expectations with respect to certain activities in certain areas. There are a variety of factors we will have to take into account in determining the revenue side of our budget. Certainly, as I indicated last night, we are not going to march in lockstep with Ralph Klein simply because he is doing it. We are not neglectful of the fact that we are operating within the Canadian and world context and we will have to take that into account as a factor, along with other factors. Certainly that will be undertaken, as I presume, it has always been undertaken.

Mr. Ostashek: I want to thank the Member for that. I think that he will find that it is going to have a tremendous impact as the reductions continue - if they continue, which we do not know at this point. It is basically going to give what I would call windfall profits to the territorial government through no actions of its own.

I know that the Member opposite had something to say about the huge profits of the banks the other day. He thought that was unrealistic. I can agree with him to a certain extent, but I think that the Member ought to keep in mind that, as we progress and if the tax rates in Canada are coming down to where it is pushing the Yukon out of the bottom third of the spectrum, I would hope that the government would take some action.

The Member made another point yesterday. He seems to think that I have found a new perspective, which is as a protector of the taxpayer. I would just like to say to the Member opposite that I have always felt that I was a protector of the taxpayer. I know that he was alluding to the tax increases that we brought in earlier in our mandate. I am not going to spend a lot of time on this, but I believe I should put it on the public record that the Member is fully aware that the tax increases were brought in at a time when we had a financial problem in the Yukon. I know that the Member has never accepted that, at least not publicly.

The Member did chair the Public Accounts Committee, which reviewed the books for that year and the Auditor General's statements and, in fact, did sign off that there was a $64 million deficit in that year. I guess my question to the Minister is: if he does not believe that there was a $64 million deficit that year, why did he sign the Auditor General's report?

Hon. Mr. McDonald: First of all, the Member is asking me a question about my time on the Public Accounts Committee three or four years ago. I realize he has a great deal of difficulty letting go of the past. I understand that he is bitter for having suffered the election loss that he did. I apologize that he feels so poorly. It is not an uncommon feeling. I have seen other people experience the same feeling, and I have no doubt that the Member wants to relive the past at great length. I am happy to spend some time in the current Legislature, going through this process.

The point I have made in the past, to relive the old debates, is that I do not doubt for a second that the Auditor General of Canada counted precisely what the Yukon Party wanted him to count. All the figures added up to a $64 million deficit, based on the information the Yukon Party gave him and the way they wanted him to count the information. I have no doubt about that, any more than I have doubt about the Auditor General's calculations of an NDP government surplus every year that it was in office, including the year right up to the election period. I did not dispute the Auditor General's findings when he was calculating a surplus every year. I did not dispute the Auditor General's findings when he indicated that the situation during the full seven years that the NDP was in government was that the books were in very good shape. I did not even dispute Michael Wilson's letter to me, congratulating me on being a fiscally responsible Finance Minister when I delivered my first budget. I do not take issue with him on that point. What the relevance of that is now, I am not sure. We have things to do.

I would like to point out, with respect to the banking community - the Member made a point with respect to windfall profits. I hope the Member is not, for a second, comparing what - as he refers to them - windfall profits could be made through a minor reduction in the income tax rate with the kind of profits that the banking community has achieved. Virtually every single bank in this country - all of them - made more profit than the Yukon government spends in two years. That profit comes from a lot of small businesses and a lot of people in this country.

I am not saying that the banks and the utility companies should not make a profit, but I think that they have to live in the same world as the rest of us and the rest of the business community live in.

The fact that they have a privileged position in our community is something that should be noted by the leadership of this country. When I have a chance to speak out on the occasion, I will. I do believe that something should be done in that particular area, but I do not begrudge them making a profit; I begrudge them making too much of a profit.

If anyone wants to put economic spending power in people's hands, why not put it in the hands of the little person? What about the businessperson? Why not ensure that everyone has to pay their fair share of taxes?

I am not a person who government bashes. I think that governments can do useful work and I think that they do useful and necessary work, and they really do make a difference in the quality of life for everybody in this country and this territory. I think everybody should contribute and contribute fairly. I think that fairness in the tax system is something that should be reviewed.

Mr. Ostashek: I thank the Member for those comments. I want to be very clear that I was not trying to compare the profits that we are going to get from changes and cuts in taxes in other jurisdictions to the profits of the banks. I am talking about the principal. Windfall profits are profits that you have not earned by your own accord. That is what I am getting at.

The Member opposite has said many times that tax increases were not required and he is quite prepared to keep spending them, and it appears that he is quite prepared to keep on spending any windfall tax increases he gets. We will see what happens with that as we move along.

The only reason that I bring up the $64 million deficit is because the Member keeps bringing it up and saying that the previous government did not have to increase taxes. However, the reality is that the Auditor General reviews the government's books by using a set of accounting practises that are the norm for governments across Canada and industry as a whole.

If there is anything out of sync with any claims that we made in the 1992-93 fiscal period to inflate that deficit, as the Member opposite is trying to allude to, he certainly would have called us to task for it. Whatever write-offs were taken were legitimate write-offs and were probably being carried on the books as receivables when they quite rightly should have been marked off.

That is all we did with that. The Member opposite is now taking over a very clean set of books as he comes into government. I hope, as we proceed, that they will remain that way.

I have another question for the Member in regard to statements he made. I refer back to October 21, a couple of days after the Member was sworn in, where he is reported in the press as saying the surplus that was predicted by the Yukon Party of $7 million or $8 million does not appear to be there, or that it simply was not there - words to that effect.

The Minister is fully aware that we sat down on two occasions and I provided him with financial information that was given to us by the Department of Finance, which quite clearly stated that the surplus at the end of the year, as of the books at September 30, would be substantially higher than the $7 million or $8 million that we projected in the main estimates.

Could the Minister tell me why he made that statement?

Hon. Mr. McDonald: First of all, I will go through the points as the Member raised them. I think they are worthwhile responding to.

With respect to windfall profits and banking profits, I want to make it clear - and I think any listener should be made aware - that we do not know if there will be a windfall. It is all highly speculative on the Member's part as to whether or not there will be any change in terms of the national average tax rates that would benefit us and give us a huge windfall - or whatever kind of windfall the Member wants to characterize it as.

When the time comes, when circumstances dictate, we will make a calculation. I indicated the factors that we take into account, and those factors will be used to determine our fiscal policy.

We will have to agree to disagree on the reasons and necessity for raising taxes in 1993. I disagreed vociferously then. If I were in the position the Member was in, I would not have done it. I do not believe it should have been done, and I believe the Member's argument for the tax increases at the time included that federal Finance essentially told him they had to do it.

We have spent five years resisting and did not believe it should have been done. I believe it led to a crisis mentality in this territory, which I thought was unreasonable.

We can certainly agree to disagree on that point.

With respect to the comments made after the election campaign, I was responding to the media, who were asking me what the situation was before the campaign, and what we, as the public, knew before the campaign and what we knew after the campaign. What I knew before the campaign was what was in the main estimates. What I knew after the campaign was information that the Member provided to me and other information that the Department of Finance subsequently provided to me. That is what we knew. The point I was making was that we knew net spending was going up. It was not made known to us before the campaign that the spending was going up, and I said so.

If the Member wants to know all that happened at the press conference, that was a statement made near the end. It was kind of an afterthought. I also qualified it by saying that I did not think that there was a crisis. I went to some pains to indicate that fact. The Member himself chose to interpret that comment as a kind of action that I am sure he would have taken if he had been in my position, based on his own actions when the NDP was defeated in 1992.

I am perfectly prepared to believe that he thought I was going to do the same thing to him as he had done to us. What he did not know was that I am not that kind of person. He did not know that I did not try to generate that kind of crisis mentality. In fact, I went to great pains on that occasion and other occasions to say, "Yes indeed, there is this level of spending going on", and, "Yes indeed, we are going through a process of approving a $32 million annual deficit. Not to worry. This kind of thing happens. There are some good reasons for it." I am not objecting to the spending proposals. In fact, I am standing here defending them.

What I did say was that it was not as rosy as I had thought, based on the main estimates. That, in fact, is quite true. That is patently true. Otherwise, we would not be standing here making a net spending request of this size. However, if the Member was fair about his criticism - as he was not with the media immediately afterward when he called me a liar - he would have known that I qualified my statements and was clear about what I was saying.

Mr. Ostashek: I thank the Member for that. It is unfortunate he made such a statement to the press because he quite clearly said that the financial picture was not as rosy as Yukoners thought.

Yukoners never knew what the level of spending was, but even after all that spending was taken into consideration, the figures that were given to the Member opposite were projecting, by the last meeting we had, a surplus in excess of $27 million. In the public forum, a public that was expecting a $7 million surplus is now blessed with a $27 million surplus, so I do not know how the Minister could stand there and say that the finances of the government are not as rosy as Yukoners expected them to be. Certainly there was more spending, but there was also a lot more surplus than was projected going into the budget.

The figure that was given to him - and I have the copy in front of me here - was $27,555,000 as of the end of September. That was an increase of $20 million, and it is unfortunate that the statement was made. Nevertheless, it was made.

My colleagues have some questions now, and I will have some more a little later.

Hon. Mr. McDonald: It is unfortunate that the Member is taking this particular tack. It is sad, because here we are, here I am, defending a $29 million expenditure. This expenditure - and we will get into this, even when we get into Executive Council Office - is almost exclusively the responsibility of my predecessors, and I will explain that in some detail. I will be looking forward to doing that - or basically looking forward to it because of some of the comments that have been made recently.

With respect to the financial picture in terms of the surplus deficit, nobody was aware at the time - and I certainly was not aware - that there were going to be significant increases in the formula financing grant, simply on some sort of windfall or recalculation.

The point I was making and I have made and I was very clear to make to everyone who would listen was that spending had gone up. When spending goes up it creates expectations that spending will stay up, and that brings its own difficulties. Every time since, at every opportunity, I have tried to modify public expectation about spending.

The Member himself acknowledged that I have been doing that. I have been extremely consistent and very careful about saying certain things in certain ways. I could have easily come in and made all kinds of alarmist statements about how we were spending $30 million more than we took in and how this is completely unsustainable and how people are going to have to really scale back and, thanks to the Yukon Party, we are going to have to cut back on programs and services. I did not say any of that.

The last thing I expected from that Member, knowing what we were doing, was the very first thing that came out of his mouth - that I was a liar. That is politics. I have been in the game long enough to know precisely what that is all about in some people's minds.

I am more than happy to present this budget today, honestly and fairly, to all Members, and to defend the requests as being reasonable under the circumstances. I may not have made the same spending decisions myself, but I am not going to carry on about that. When we talked about the Hughes inquiry, am I going to stand up and say that that is a worthwhile expenditure? That is the last thing I would say.

I know that it was billed by some on the Yukon Party benches that this was done for my benefit. The point that I have made - and will continue to make - is that we must be modest in our expectations. We must recognize that the spending that we are doing now cannot be sustained. We must recognize that there are some major projects that may not be continued, although Shakwak might. Certainly the hospital will be completed. We must realize that that is the reality, and I have been saying so consistently, without trying to be alarmist. I have been asked numerous times by the media where we are going to cut and what kind of crisis can I generate with a slip of the tongue. I have been very careful to try and moderate those concerns, because I do not believe that we have to have a crisis mentality, even though I recognize, admittedly and openly, that we cannot sustain this level of spending.

Mr. Jenkins: I have a few general questions for which I am seeking answers.

I am looking at the formula financing grant between the federal government and the Government of the Yukon. Outside of the House, I am sure there are few who understand the perversity factor and what it entails. I was hoping that the Minister could provide us with a layperson's interpretation of the formula financing grant and the perversity factor in terms of how it works and how it affects us.

Hon. Mr. McDonald: Certainly, I could do that.

There are a number of variables that go into determining the formula financing grant. Certainly one of the factors is the population of the territory; that is but one factor. The perversity factor, or the tax-effort factor is essentially a calculation based on national average tax rates for the country.

A number of taxes are applied across the country; a whole series of taxes are applied in jurisdictions across the country. The calculation determines where the Yukon stands in comparison to all the other jurisdictions in terms of laying out our taxes. For example, we are charged some taxes at a higher rate than the national average rate and some taxes are not charged at all. We do not have a sales tax, for example, so we cannot calculate that into the equation other than to say that we receive no revenue from that particular potential source.

Essentially, we are rated on a scale comparing ourselves to other jurisdictions based on the indices of taxes that are commonly charged in other jurisdictions. According to those indices, federal Finance suggests that if we were to be at the national average, we would have to increase taxes to Yukoners 47 percent overall. Your tax burden as an individual, as a businessperson, would have to increase a full 47 percent before there would be no further penalty to our formula financing grant.

Essentially what happens is that if there is a penalty factor, that percentage factor, we are penalized for increased taxes as a result of volume increases by a corresponding reduction plus the penalty from our formula financing grant. They are essentially saying, "Raise your taxes or else." That is yet another factor that the federal government takes into consideration when it is calculating the transfer payment from Canada.

There are a series of factors. There is provincial-local escalator clause that indicates where we rate. They essentially analyze what the expenditure rate is in provinces and municipalities and determine how we compare, and ultimately our formula is adjusted based on that factor as well. There are a number of different factors. It is a complex calculation, admittedly. There are a number of different factors that determine the formula financing grant.

I will read it. It may be a clearer explanation of perversity. Perversity is the multiple it takes to put our total tax yield at what the federal government thinks we should raise. They think we should raise 85 percent of national average tax rates; that is, about 32 percent at the present perversity factor plus 15 percent for the northern break they give us, which equals 47 percent.

Essentially, there are a number of different calculations. If you want to see the mathematical calculation, it can all be found on one sheet. It is all numbers, brackets and mathematical calculations. The calculation itself is determined by a number of different factors. The Member will recognize this analogy; it is even more complex than the formula grant for block funding for municipalities - much more complex.

Mr. Jenkins: Keeping that explanation in mind, if taxation in other jurisdictions in Canada were to be reduced and our taxation remained the same, our perversity factor would provide this government with quite an amount of additional funding - the perversity factor would go down, would it not? Could we have the Minister's undertaking to keep Yukon in the same position in the overall national tax average that we presently occupy?

Hon. Mr. McDonald: I thought I just answered that question to the Leader of the Official Opposition. It was put almost exactly the same way. Yes, indeed, if national tax rates go down that will change our status in the indices of taxes that are charged across the country. If the Member is asking if we will automatically agree to lower our taxes to stay within a certain range of tax rates across the country - that being the primary and only factor - I cannot give him that commitment because there are other factors to be considered, as well. I can tell him, as I told the Leader of the Official Opposition, that that will be a factor to consider, but it will not be the only one.

Mr. Jenkins: In the past, how accurate have the government calculations of the amount of funds flowing through to the government been, when compared to the funds that are actually determined by the feds and flow through? How accurate have our calculations and estimates been? How much of a gap has there been in the past? How often are these funds paid?

Hon. Mr. McDonald: The calculations done by the Yukon Department of Finance have historically been fairly accurate - obviously not perfectly accurate, as they can be out a few million dollars. Obviously, a few million dollars to us means a lot but, overall, based on the fact of the complications of the formula itself, and based on the fact that some of the input into the calculations is determined by federal authorities - Statistics Canada being one - we cannot be perfectly accurate all the time, but we are pretty close, and we have been pretty close historically.

Mr. Jenkins: How often do these funds flow through from the feds to the government?

Hon. Mr. McDonald: The funds come to us on a monthly basis. There is an estimate made at the beginning of the year and we get installments from the federal government on a monthly basis.

Mr. Ostashek: I have a question for the Minister. I know he has been on this only a few months, and they must have started their budget cycle now for the next budget, which takes some time to put together. The supplementary before us is to take us to the end of the year, on a best estimate basis by the departments as to what they figure their spending will be. It should cover us off to the end of the year. It will then be adjusted.

I know there is always a lapse time between the time the supplementaries are put together, printed and tabled in the Legislature. There may be other spending that will take place before the end of the year that will be covered off by the final supplementary.

At this point, can the Minister tell us if he is aware of any substantial changes to the financial position, other than what is in this supplementary, for the year-end?

Hon. Mr. McDonald: As the Member knows, historically, there will be lapses. If experience is any measure there will be lapses in this year, I am certain about that.

It is our view that there will not be any changes right now in expenditure plans, as far as we are concerned. There may be some minor variations in revenues, but they may be minor in detail. I think we are pretty much on target, but I am pretty certain there will be some lapses.

Mr. Ostashek: I appreciate that. I just wanted to know, because sometimes shortly after the supplementaries are put together, departments come forward with a request for further monies.

I want to spend a little time to find out about the Member's thoughts about where he is going with finances, because he made many statements when he was Opposition about what should be done with the financial planning of the government. I would like to take this opportunity to find out a little bit about that.

One of the policies that I had when I was putting budgets together was that I based the spending that I would have for the next year, based on the projected, accumulated surplus at the end of the year, not taking into consideration any lapsed funds for the end of the year. I did not like counting those funds, because as the Member said, we did not know if those funds would lapse or not.

As an example for Members, so that they can understand what I am talking about, if I were to look at the supplementary budget this year, I would have whatever income was projected by Department of Finance plus a little more than a $25 million surplus to work out my next budget.

Is that the Member's approach to it, or does he have a different approach to take to it?

Hon. Mr. McDonald: I guess I do not quite understand what the Member is asking. Is he suggesting that we regard the availability of funds to include the $25 million surplus? Could the Member explain himself a bit more clearly?

Mr. Ostashek: I want to tell the Member right off that I am not suggesting anything; I am asking a question of the Member.

There are going to be projections from Finance about how much revenue is going to be coming into the territory next year. It will have those revenues for the next budget, plus the posted, printed or published surplus of $25 million. That would be the figure, excluding any lapsed funds, that could be $10 million, $15 million or $20 million at the end of the year.

I am asking the Minister what his policy is going to be in putting his next budget together. What revenue figures is the Minister going to base the budget on? Is it going to be based on the projected revenues that the Department of Finance will give him, including the surplus, which would be added to those projected revenues, not taking into consideration any of the lapsed funds that may or may not lapse? Or, is the Minister going to have a different method that he will use for projections?

Hon. Mr. McDonald: It is a little premature to be identifying our budget policies at this point, given that we have not made anything smacking of final decisions on any of these points. I can tell the Member that it would be my preference to do a budget plan without the assumption of lapses, but factoring in the projected revenues, noting the surplus and not factoring in lapses, even though we know there will be some.

Mr. Ostashek: I appreciate that answer from the Minister. When the Member is in Opposition, there is always a great debate in this Legislature as to what kind of a cushion the territorial government should or should not have. As the Member opposite knows, every time Finance sends us a financial statement, it says it would like to have a 30-day surplus, which, to date, would mean about $40 million. Could I have the Member's thoughts on that?

Hon. Mr. McDonald: From my experience, Finance generally would like to have as much of a surplus as possible, except when it is about to go into a meeting with federal Finance officials to talk about formula funding arrangements. Then the message is, "Spend, spend, spend."

We have not made a formal position on that. Certainly, there should be some cushion. Whether it is a month's spending or whether it is a month's spending on O&M and capital - obviously we do not have a month's spending here for O&M or for O&M and capital - but there ought to be some cushion.

The $25 million represents how many days of spending - a few? Eighteen or 19 days? Obviously not very much, so consequently we will have to be careful about that. I am certain it will be part of our budget planning process.

Mr. Ostashek: I just have a quick question, and maybe the deputy minister can answer. What is the perversity factor as of today? What is the exact rate?

Hon. Mr. McDonald: It is $1.32. It was on the sheet I provided yesterday.

Mr. Ostashek: I see. That has gone up a little bit from what we were projecting a few months ago. I think we were down around $1.20. I understand that it continues to change.

The Minister was very critical of my administration for having no long-term planning in government finances. The Minister is aware that the government does three-year operations and maintenance plans in the department; it does five-year capital plans in the departments.

Could the Member tell me what other long-range planning he plans to implement?

Hon. Mr. McDonald: I cannot tell the Member this with any precision at all now. As I indicated yesterday, I do intend for us to make public the general sense of where our revenues are going to be and where our basic operations and capital expenditure levels will be over a long period of time. I do not know how long it would be for yet. I would like to think about this some more.

I would like to spend some time with the Finance officials to go through some options as to what kind of long-term financial expenditures we can anticipate, what information we can give to the public, and with what degree of accuracy. We will give people some sense of where we are going over a longer period of time in certain key critical areas.

I have not had a chance to speak with the Department of Finance on this point, but in the next year or two I certainly intend to make public longer term financial plans of the government. I would like to encourage those that we fund to also undertake longer term financial planning that is more than just year-to-year planning.

I am not referring to the five-year capital planning cycle which, quite admittedly, and the Member will know this, is really quite fanciful. If one looks one, two or three years down the line in the capital plan, Community and Transportation Services, by itself, would have us spend hundreds of millions of dollars a year. They sort of lard everything into the capital plan at some point. I would like to do something that is more accurate than that, and do it publicly.

Mr. Ostashek: I can assure the Member that, after the many hours of debate that we had in this House over the last four years, I would have thought that he would have some plans, particularly after the criticism he projected. Nevertheless, he is the Minister now, and we will give him the opportunity to come forward with some of those plans. I can assure him that we will be asking questions to see what different planning is going to be done to finance his government and measure it against what has been going on for many years in government to see if there is any real difference.

I have a question for the Minister about the Shakwak project. Could he update us on the state of negotiations for the further funding to complete that project?

Hon. Mr. McDonald: First, I can assure the Member that he will be among the first to know when we change the planning cycle and the financial planning process of the government. I certainly have ideas and principles, as a politician, as to what should be imposed on the public service. I expect that it would be only reasonable that I would actually speak with the technicians and Finance officials about those plans in order to bring them through to reality.

I would hope that the Member would give me more than just six weeks in government to put all this in place. I would ask that the Member give us even more than six months to do all that we promised to do in our campaign platform.

It is certainly my intention to introduce longer term financial planning, as well as more public process for announcing our financial plans.

With respect to the Shakwak project, letters have been sent to Senator Stevens and Congressman Young, as well as to officials in Alaska, from me and the Minister of Community and Transportation Services, requesting a renewal of the Shakwak agreement. As the Member knows, the last one was negotiated in 1991. We believe there is approximately another $94 million required to bring it to completion. We would like to secure that funding, if we can. The Minister of Community and Transportation Services will be in the process of leading the negotiations to see if we cannot bring the agreement through to a successful completion, from our perspective. I was in the government before when this was initiated; we know what it takes, if there is a will on the American side, we may well see a new agreement.

Mr. Ostashek: I thank the Member for that. I would just draw to the Member's attention that he has been in government before. He was a Finance Minister before, and I would expect he had some idea of what he wanted to do. He certainly thought I should have, even though I was a new Finance Minister. We will give him some time, but we will be going back to those questions to see if there is any real difference.

Regarding the Shakwak project and what the Minister has related, I am fully aware that the negotiations have been pretty well completed. The pitch has been made; we have had people, even down in Minnesota, having a meeting quite a while ago on that. I understand the senator and congressman in the United States have been apprised of what we are after and are prepared to lobby for. My understanding is that it was in the budget cycle in the United States now, and I was wondering if we had heard anything, or when do we expect to hear of a decision?

Hon. Mr. McDonald: The information the Member has given me is substantially at variance with the information I have received from officials with respect to how advanced the negotiations are. I was not aware that the negotiations were just about complete and we are just about to get an answer. I was under the impression that negotiations had only begun and that there was a lot of work to do. I can get a clearer impression of what the Department of Community and Transportation Services has been doing, and perhaps when we get to that line item, the Minister will be in a position to provide the Member with more detail.

I am somewhat disoriented. I take the Member at his word that negotiations are almost complete, but that is not what I have heard from department officials. I will remember to check on that point.

Certainly, in answer to the specific question the Member asked - presuming the negotiations are just about complete - about when we are going to have a yes or no answer from U.S. officials, I will find that out. I do not know that answer.

Mr. Ostashek: I appreciate that. I could be wrong on that, but I understood a lot of talks were going on and it was being included in the next five-year capital budget of the federal Congress in the United States. I did not know what stage of the process it was at.

Can the Minister tell me if all of the contract monies with respect to the Shakwak project have been expended, or is some money left over for contracts from the last set of negotiations?

Hon. Mr. McDonald: As far as I am aware, some expenditures will be made next year. Some work will be done next year. As the Member knows, the supplementary does draw next year's projects into this past year, and those projects have been undertaken and, presumably, completed. I do not know precisely how much work is going to be done, but perhaps when we get to the Department of Community and Transportation Services, the Minister can be more clear on that particular detail.

Mr. Ostashek: I thank the Minister for his thoughts on that. I do not think I have any more questions in general debate on the budget. I do have a lot of questions when we get to Executive Council Office. It is going to take some time to go through that.

I just want to tell the Minister that I am not asking him to defend anything we put in the budget. I am quite prepared to defend that myself. We do, however, have a lot of questions on some of the expenditures that have been created by the new government, including some of the new procedures that have been set up. We would like to get full and detailed information, and I am disappointed that I have not received the organization chart from the Member on his Cabinet support staff, on the commissions or on the reporting procedure - what the steps are and who reports to whom. I think all of that would have helped us in going through the Executive Council debate. Nevertheless, we will get through it.

Hon. Mr. McDonald: I am actually looking forward to this because, as I will point out in short order, the lion's share of expenditures are indeed going to be the Yukon Party's responsibility and I will be explaining, whether or not I am asked questions, what those items are; I am prepared to do that. Some expenditures I do support and some I do not, but I will not be making a big deal over the ones I do not.

With respect to the information about Cabinet staff, I was under the impression that Cabinet staff information in terms of the names and salary ranges was provided to Members. I can check with the Principal Secretary on that point. If it has not, then I can make sure that it is provided to the Members.

I do want to be able to point out the fact that while we do have more staff, we have not increased the number of staff per caucus Member. In fact, even with the new staff, we are still operating within the same budget for Cabinet support that our predecessors did. I want to be able to point that out and be very clear on that point. I certainly want to provide the information because I am happy that we were able to accomplish that task.

With respect to the commission reporting structure, it is a fairly simple reporting structure and I can explain that verbally. I do not think the Member needs a picture with boxes. I can explain it very clearly in Committee debate. When we get to that particular line item, I would be more than happy to explain how things work.

Mr. Ostashek: I believe we do have the list of employees and the salary ranges. We were looking for an organization chart to see how the offices operate, what was happening and what was going where. We will have plenty of debate on the pros and cons as to the ratio of staff to caucus Members when we get into the Executive Council Office.

Chair: We will go the estimates books.

Yukon Legislative Assembly

Chair: Is there any general debate?

Mr. Cable: The Government Leader is probably aware of the unfavourable public response that resulted from what I think was a coin toss or some sort of luck of the draw that took place in the Vuntut Gwitchin riding, and I was wondering if he is amenable to changing that part of the Elections Act and bringing in a different methodology for resolving a tie vote.

Hon. Mr. McDonald: I am certain there are pros and cons to the various proposals that people have put forward in the past. I am more than happy to accommodate Members to review the Elections Act. I think we have all agreed to review various elements of the Elections Act already, particularly with respect to financing rules. I would be more than happy to have this legislation reviewed, including that provision, and if people can find a more fair way of determining the outcome of an election where there is a tie, then we would be fools not to consider it. However, because we are already opening up the Elections Act, I am certain that the Standing Committee on Rules, Elections and Privileges, which has been underworked over the last few years, should be given something to do. This is useful work and I would encourage them to consider it. If we can get all-party agreement on when we should be reviewing the act and what the terms of reference for the review would be, then we can get a motion into the Legislature that we refer the matter to SCREP and begin the review.

Mr. Cable: Of course, as the Government Leader is aware, there is a controversion application under way now with respect to the Vuntut Gwitchin riding, which, in the usual scenario, would be heard some time in the next few weeks and the decision rendered shortly afterwards. Then there would be six months before a by-election would be called, if in fact the controversion attempt is successful.

Is the Government Leader prepared to consider whether the section relating to the luck of the draw could be reviewed in isolation with a view to drafting an amendment at the beginning of the next session, if we all agree to make exceptions to the budget status of the next session?

Hon. Mr. McDonald: I will have to discuss that particular comment with my colleagues over the next few weeks,. Perhaps if that is possible and if it does not compromise the government's interest when it comes to trying to get a budget through the Legislature in a timely way, then I do not necessarily see that as a bad thing.

I do not have any objections in principle to that idea, but I would find it hard to believe that there is going to be another tie vote in the riding of Vuntut Gwitchin, because I am of the view that there should not even be an election in Vuntut Gwitchin.

If some Members want to put some thoughts down on paper as to how the situation might be improved, then we will consider those ideas.

Mr. Cable: That would be very useful. Whatever the merits of the application may be, and if in fact it is successful, then in view of these small number of voters, a tie is mathematically a lot more likely than in the Government Leader's riding, for example.

It would be very unfortunate, both for the winner and the losers - if there is more than one - to have to go through some sort of public analysis as to whether or not they are prepared to sit in their seat, as has happened in the last few weeks.

Let me encourage the Government Leader to get his head around the topic and determine whether or not we should be looking at the particular Elections Act amendment in isolation.

Hon. Mr. McDonald: Without being cheeky about this, the mathematical chances of there being a tie would improve if the Liberals would not put in a candidate and act as spoilers.

Having said that, I do not want to send out any signals that they should not at least put a name on the ballot.

I will certainly give this some consideration and I would encourage all Members, if they wish to consider the matter and present proposals, then those proposals should be considered if they are seriously put forward.

I and my colleagues have a very big agenda. There are many things to do between now and spring. I hope that we can accomplish a fair amount before we return to the Legislature in a few months, but that is not very much time.

I would encourage Members who have a little more time, if they wish, to put forward some ideas to change the system. I am certain that we can consider any good idea that manages a tie better than that contained in the Elections Act - this includes any Member in the Legislature who has some good ideas on this point. It is not an easy one at all, because sometimes the alternatives are not palatable for their own reasons.

I do not want to dismiss the work of the people in the past. I realize how arbitrary a tie vote being determined by a coffee cup shuffle might seem, but the alternatives were not that easy to determine. For example, if it was simply a matter of another election, then in this particular case the people who were standing for election might feel they were at a disadvantage if they knew they would be sitting in an opposition party. They may not feel that that is the best approach to take. It is sometimes easier to be elected into a governing party.

That chemistry may change by the end of a term. There are various factors to take into consideration. I would implore those people with the creative energy to put something forward to do so.

Mr. Cable: It did not happen this time, but it could have happened that the government could have been decided on the toss of a coin. I think there would have been a great outpouring of rage from the voters if the flip of the coin were the determinant of the government, and all those thousands of votes probably did not mean anything, that it was just a piece of metal being flipped in the air, or whatever took place.

Let me suggest, if he is interested, that the Leader of the Official Opposition, who has expressed considerable reservation on the methodology that is used in the Elections Act, and I might present to the Government Leader some solution, if the Government Leader is agreeable. I do not think the drafting would be complicated, whether it is a runoff solution, or whatever. If he is agreeable, we might work out some sort of a compromise in our written agreement whereby we could introduce an Elections Act amendment to deal with that situation. Of course it could not be retroactive to the present situation, but it might give the voters a lot more faith in the way the election system works if that were dealt with.

Hon. Mr. McDonald: I would encourage Members to do just that. If we can come to some sort of all-party agreement, there should be no difficulty in getting a measure through the House in short order. This House can pass measures very quickly, if it wants to. If the Members want to do that, it would certainly seem to be a good idea to me.

Mr. Ostashek: I will only speak specifically about the Vuntut Gwitchin thing because I think that will play itself out before the Legislature is called back, one way or the other. I do not know if we have time for that right now.

I want to take this opportunity to raise the issue of an overhaul of the whole Elections Act before the next general election. This last election, in particular, pointed out the weaknesses in our act and all the places where it needs clarification. I think that we would be doing a service to all Yukoners if we did expend the energy to do a complete overhaul of the Elections Act. I do not know when it was last done. I know that it has been tinkered with. We brought in some small amendments to it, but I do not think there has been a complete overhaul.

I know that Members opposite had some difficulties with the interpretation of the act and had a couple of court challenges. It seems that, with every election, there are court challenges. If we did a better job running the elections and tightened up the act, we may be able to eliminate some of these court challenges.

This has been an ongoing thing in the Yukon, not just from the recent election, but almost every one. We end up with these court challenges in some way or another. In Watson Lake it happened a few years ago and in Whitehorse Centre last time. This time, it was Vuntut Gwitchin. What concerns me the most is that, in a jurisdiction like the Yukon and even in ridings that we call large ridings - we are talking about 1,400 voters in the largest riding - the possibility of a tie or a person winning by one or two votes is very real. Many ridings are decided by a handful of votes. I think it is important that we do as good a job as we can in making sure that eligible voters are voting and that the act is able to deal with all the situations that arise in the Yukon.

In other jurisdictions, they talk about a close race being 5,000, or 8,000 or 9,000 votes. We are talking about five or six votes - my colleague from Riverdale North mentions seven. Our party agrees with the Liberals. I hope that the Government Leader also agrees that we should spend some energy on this and have a complete review of the Elections Act.

Hon. Mr. McDonald: I just want to briefly respond to that.

I am certainly prepared to ensure that there is a review of the Elections Act done during this mandate and before the next election. I am certainly prepared to accept and adopt a long-standing principle in this Legislature that we try to get all-party support for any changes that are made. That would be my commitment. I would like to see all parties agree to any changes that we propose to the Elections Act, so that nobody would have the sense that somehow the majority is ganging up on the minority. In any case, there shall be and should be a review of the Elections Act between now and the next general election.

Ms. Duncan: I appreciate what the Government Leader has just indicated.

I would like to request that in the review of the Elections Act, we consider a couple of things. First of all, a constituent has raised with me the issue of the permanent voters list. I know that it has been discussed before and that there are probably very good reasons why it has not been done. Maybe there are good reasons why it should be instituted now. However, at a minimum, I would like the response to the suggestion of a permanent electors list made public, so that we can consistently deal with this request.

I recall the last time that the boundaries for electoral districts and redistribution were done. I think that it was in the early 1990s. I can remember the public response at the time being absolutely a loud yawn. Yet, during the election, when you go door to door and explain to the people that, for example, the Laberge riding extends from Birch Street in Porter Creek to Twin Lakes, they are absolutely amazed, because there is not much of a common viewpoint in that whole area. In my riding, there is one street in particular where half the street votes, or may choose to vote, for the Leader of the Official Opposition, and half the street thinks that they are - and quite rightly, they are - in my riding. There are some strange divisions in the boundaries. I think we should look at them again.

The other point I would like to make about this is that, as we all know, the level of political efficacy after an election and leading up to an election is very high. Between times, it is extremely low. I would just say that I think that this is not a matter that we continually shuffle year to year and then say, "Oh, my goodness, there is an election coming, we should do something." It is a matter that we should treat with some urgency.

Hon. Mr. McDonald: In the first place, by respecting the permanent voters list, I understand that there may be some movement made at the federal level to pursue this course. I have heard about this in any case. Certainly, if there is such a permanent voters list, there may be some efficacy in seeing what they are doing and perhaps do something jointly if that is reasonable.

With respect to the point involving riding redistribution, I do not want to make any commitments on my own or even speak off the top of my head about that. That is a big political decision and I would encourage people and party leaders to think about that carefully. I understand the ramifications of doing that. I recall the last time that it was done. There was a meeting of minds among party leaders that it should be done and it should be done in a particular way. I was not involved in those discussions personally, but I understood that to be the case.

The third point I would like to make is about urgency. I would encourage people to note and do a post-mortem of the election and note their issues and concerns. Ideally, I would like to see the government and its Members - my colleagues - put some energy into this important project. There are also other important projects that we must do. I do not want to dilute their attention too much from some of the things that we really have to do.

The Member makes a good point. I do not want our corporate memory to grow dim and lose some sense of the direction that we want to go as a result of being so fresh from an election. We, in the NDP, are doing a post-mortem and a review of the kinds of changes that our party would like to see promoted. We will present them to the people in Opposition when we get to this project and see if we cannot get agreement on both the process by which this will be reviewed and also on some of the changes that we think are reasonable.

Mr. Ostashek: I just have one further question. As I follow the debate, I gather we are talking about two separate issues here: we are talking about a review of the Elections Act and we are talking about the Electoral District Boundaries Commission when we talk about boundaries. That is not under the Elections Act. It is a separate commission. I believe by law we have to have a review of that every so many years - I see the Clerk is shaking his head no. Just to add to the debate, a lot of constituencies are getting out of sync. The last time we did the review there was a term of reference to try to have plus or minus 25 percent equal across the Yukon, as close as possible, but we are certainly out of sync already.

I and my party would certainly support a new electoral boundaries commission at some point before the next election to look at the situation and try to give equality among voters in the Yukon.

Chair: Before we go line by line, is it the wish of the Committee to take a short break?

Some Hon. Members: Agreed.


Chair: I will now call Committee of the Whole to order. We will go to operation and maintenance.

On Operation and Maintenance Expenditures

On Legislative Services

Hon. Mr. McDonald: This is a requirement to cover caucus funding needs. This is an increase of $55,000, but it is being offset by a decrease of the Commonwealth Parliamentary Association activity. As Members know, caucus funding is allocated according to a formula that provides $25,100 to each private Member for research, $53,000 to the Official Opposition caucus for secretarial services, $29,400 to each third-party caucus and, I think, to the government private Members.

When this formula was used to assess the caucus funding needs following the general election, it was found that the total amount required for the remainder of the fiscal year was $194,000. However, as of October 1, 1996, only $128,500 remained in the caucus funding. This has been supplemented by $10,000 from elsewhere in the Legislative Services program, leaving an overall requirement of $55,000.

I would point out to Members that, having done an analysis of what the Official Opposition caucus spent in the period up to the election, we spent approximately, on a pro-rated basis, about the amount of money we were allocated on a monthly basis up until that point. Consequently, the funding required here is to make up the difference for some more aggressive spending patterns practised by other caucuses in the beginning of the year.

That is what this requirement is for. It was felt that we should start off on a good foot and that the caucuses should be appropriately and adequately funded to begin their work as new legislators in the Legislature. Consequently, it was felt that this was a justifiable expenditure.

Legislative Services in the amount of $52,000 agreed to

On Legislative Assembly Office

Legislative Assembly Office in the amount of $4,000 agreed to

Operation and Maintenance Expenditures in the amount of $56,000 agreed to

On Capital Expenditures

On Legislative Assembly Office

On Opposition Office Renovations

Hon. Mr. McDonald: The work done for the Opposition offices is funding that was spent by Government Services personnel. The amount is broken down as follows: $15,000 for materials; $47,000 for labour; $36,000 for the work in the meeting room area for information services branch personnel displaced by the expansion of the Opposition area and $5,700 for renovations of the old third-party offices to provide new meeting rooms.

Mr. Ostashek: I followed the Minister's reading of the various breakdowns of the expenditures, but did I hear the Minister say $36,000 for the renovations for the information services branch? If so, is that charged to the Opposition offices, then?

Hon. Mr. McDonald: It is because it is a consequential change in office space status resulting from the renovations, just as in the Executive Council Office the change in the Cabinet offices and the costs of that change also include the change in relocation of the Executive Council Office to another location. Therefore, the consequential change as a result of the renovations and the additional space being provided is also calculated into both the Legislative Assembly Office budget and the Executive Council Office budget.

Mr. Ostashek: I thank the Member for that. At least that gives me some level of comfort, because I was going to have many, many questions if the couple of partitions in the Opposition's precincts total $104,000. With that breakdown, I do not know what they did for $36,000 over there, but it seems a lot closer and a lot more reasonable. I thank the Member for that explanation.

Hon. Mr. McDonald: The specific renovations in this area provided by the Legislative Assembly Office show that the cost would be $62,000 for the actual renovations downstairs. That increases the space by 50 percent per Opposition Member from the precincts that were there before when the Opposition was housed in that space.

Opposition Office Renovations in the amount of $104,000 agreed to

On Opposition Computers

Opposition Computers in the amount of $44,000 agreed to

On Government Private Members Computers

Government Private Members Computers in the amount of $24,000 agreed to

Legislative Assembly Office in the amount of $172,000 agreed to

Yukon Legislative Assembly agreed to

Executive Council Office

Chair: Is there any general debate?

Hon. Mr. McDonald: I will make some general remarks before we get into the debate.

The supplementary provides for an increase of $1.263 million in O&M spending by the Executive Council Office, and an increase of $499,000 in capital spending. The increase in O&M spending for the transition of government consists, in part, of $283,000 toward severance payments for two former Yukon Party Cabinet staff and contracts related to the transition, and $193,000 for severance payments for two deputy ministers who were contained in this department and who have left government.

The other major component of the additional O&M funding reflects the priority of the governments to land claims and to other issues that Yukon people have indicated need priority action.

An additional $258,000 is allocated to land claims, in keeping with our renewed efforts to settle outstanding First Nation final and self-government agreements and to implement these agreements. Most of this money is recoverable. This includes $30,000 to assist municipalities, through the Association of Yukon Communities, with the implementation of land claims agreements. This recognizes that both government and municipalities will be dealing with a new order of government in Yukon with the settlement of land claims.

The sum of $128,000 has been provided for in the supplementary for additional work within the Executive Council Office to support increased work, primarily on devolution.

The new government-to-government relationship with Yukon First Nations, as well as inter-governmental initiatives, such as the Premier's Council on Social Policy Renewal and Reform, the Northern Forum and the Arctic Council, will require focus, attention and a stronger intergovernmental emphasis. We want to ensure that issues of importance to Yukon people are fully taken into account in national and international arenas.

We also want to report on other key concerns of Yukon people: forest policy, energy, Yukon hire as well as the development assessment process, which is a commitment arising out of the land claims agreement. Accordingly, $167,000 is included in the supplementary for Cabinet commissions, headed by private government MLAs. The commissions will not be permanent structures but will provide us with the ability to focus on key areas that involve a number of stakeholders in a focused manner in order to resolve key, long-standing public issues. It is important to note that this is not new funding but rather funding reallocated from elsewhere in government. The commissions will carry out their work within existing resources.

The other items in the operation and maintenance portion of the supplementary budget reflect spending or recoveries not anticipated or known when the main estimates were set. For example, $112,000 is included for two public inquiries; $32,000 is allocated for the cost incurred by the inquiry into the Workers' Compensation Health and Safety Board during the current fiscal year and that brings the total cost of this inquiry over a two-year period to $68,000. An allocation of $80,000 is included to cover the cost of the Hughes inquiry into allegations of conflict of interest.

The allocation for aboriginal language services has increased by $140,000. This reflects the full level of funding provided by the federal government for this program. This level of funding was not known until after the federal budget was tabled, which is too late for inclusion in our budget. This information, however, was disclosed to the Legislature during debate on the mains last spring.

In the capital supplementary, it was noted previously that there is a $499,000 increase in capital spending in the supplementary. An amount of $126,000 is dedicated to the implementation projects related to land claims. These funds are fully recoverable from the federal government. An amount of $233,000 is to cover the capital cost of the renovations at the Cabinet offices and the associated move of the Executive Council Office as well as equipment needs associated with a larger Cabinet office area. The remaining $140,000 is for equipment for the Cabinet commissions and increased staff within the Executive Council Office. These are one-time costs.

This provides an overview of the supplementary estimates for the Executive Council Office. I can respond to other questions and other issues as we go.

Mr. Ostashek: I thank the Member for that. When we get Hansard on Monday morning, we will be able to go over it. I am sure some questions will flow from it.

In general debate on the Executive Council Office, there are a lot of areas that I want to cover, and cover in detail, some of which we cannot get into in Question Period. Perhaps we can get clarification of some of the government's actions.

I want to examine the Cabinet commissions. I want to talk extensively about what is happening in land claims. I want to talk about devolution. I want to talk about what we perceive to be the politicization of the civil service and the method by which deputy ministers are appointed.

As the Member opposite has said, most of the costs in the supplementaries were incurred by my government when we were in government. He has signed them off. He has said that, in his opinion, most of them, for the most part, were legitimate expenditures. He may not agree with some of them, but that is fine. We are not really concerned about the amount of money that has been added to the supplementaries by the change of government, because there is always money at the change of government, but I am concerned about some of the statements that have been made and I want to examine them in great detail and see if we can get some clarification of them.

I will have numerous questions, most of which can be answered in general debate so that when we get to line by line we will not have to spend too much time.

The Member stated in remarks made earlier today, and also I believe in a press release, that they have 23 staff now for Cabinet support. Am I correct?

Hon. Mr. McDonald: I will get the figures of the exact number of staff presently. As I am finding the figure, I will point out to the Member that if he is not concerned about the level of funding, I am at a loss as to what his comments meant when he was talking to the media the other morning about the free spending practises of the new NDP government. I took great exception to that because as I looked through the expenditures, noting we had tried to do some very careful planning with respect to spending, I realized how patently obvious it is that the lion's share of this budget is directly the responsibility of the previous government.

When one goes through the various activities, even within the Executive Council Office, one sees how much of this spending not calculated into any period 6 variance report has nothing to do with this government or this government's actions and how little spending is actually the conscious decision of this government - this brand-new government.

My ears were burning when I heard those comments on the radio the other morning. I thought to myself: how is it that a new government can take responsibility for topping up the caucus funding for the Yukon Party caucus that had overspent its budget? How is it that our government would take responsibility for office space construction costs for the Opposition offices? I did not calculate those funds. The Government Leader did not qualify his statements to suggest there are some ongoing decisions, even decisions made by the Opposition caucuses that actually affect the surplus/deficit situation of this government.

Who should suggest that, in the construction of office space for example - and for all politicians, any time office space is constructed is not a popular expenditure, by the public's estimation - and who is to know that, when we came in with an 11-person caucus, with clearly insufficient space to house that caucus, when we did increase the caucus office space by 10 percent per Member, we were also increasing the Opposition caucus space by 50 percent per Member.

Yet, this Member took it upon himself to lambaste the high-spending practices of the NDP. The NDP has hired 23 positions in total. That is approximately two and a bit for each caucus Member. That is the same ratio as the Yukon Party.

I would point out that the budget to pay for those people is precisely the same as that of the Yukon Party, despite the fact that we have private Members who are actually doing important political work for this government and this Legislature. Those commissioners are not being paid extra for this work. There is no honoraria or special payment for doing this extra work. They are doing it because they are committed to it. We made a conscious decision not to spend more, in terms of Cabinet office support, than did the Yukon Party. We did this consciously, even though we have a larger caucus, which includes four private Members who are actually doing something important beyond their normal MLA duties. We made a conscious effort to do that.

We have been very careful to deal with certain patterns of expenditure. Who gets off saying that this government has not been careful with its spending, when one can say that this government, on a per person basis, is spending less than our predecessors?

I want to go through this information in some detail, because I think that a whole lot has been said and a whole lot of threats have been made by the Yukon Party Opposition that have no foundation. They are completely unfair, suggesting that somehow the major portion of this budget - or a large portion - is somehow demonstrative of the fact that the NDP likes to spend money.

What have we done that is new in this budget? The major portion of the expenditures that is new, apart from office space renovations, is the community projects initiative. Even so, it is one sliver of the expenditures for this supplementary alone. The community projects initiative is what people have been asking for.

Do the Members opposite actually think that I am happy to ask my colleagues and others in the Legislature to spend $193,000 in severance pay for two deputy ministers who were in this department?

Members talk about lots of deputy ministers. Well this department had two - three, actually - upon assumption of the government. This particular department had three deputy ministers in it.

Does the Member think that I am happy about having to spend money on severance pay for deputy ministers who voluntarily choose not to accept a job that was offered to them? The Member cannot possibly think that I wanted to spend $193,000 in this particular manner. No way.

The question of severance pay for Yukon Party staff is a legitimate expenditure and I have no quarrel with that expenditure. I have not and I will not ask for a breakdown for what those expenditures actually were. I was given a global budget and I accepted it at face value, but by implication I am responsible because there is this expenditure of some $200,000, and I become the high-spending New Democrat, a high-spending socialist. Is that fair?

When it comes to inquiries, surely to goodness the Member would not think that I, of all people in this entire world, defending this particular expenditure in this Legislature, is another example of a high-spending, socialist government at work.

When it comes to the commissions - let us spend some time talking about the commissions - I think it is a good innovation and I think it is a healthy and important way of doing business.

The commissions are set up, at least as far as the commissioners and the deputy commissioners are concerned. There are secondment agreements being struck between departments for some staff going to each commission, but the funding for these commissions, unlike other funding proposals in this particular bill, are not eating into the surplus of this government and are not changing the surplus/deficit situation of this government one bit. Now, the Hughes inquiry sure is, but the commissions are not.

I would argue now that when we talk about various individual commissions, in some cases, the commissions are actually costing us less than the activities previously undertaken in key critical areas.

Let us talk about forestry, for example. I mentioned the other day that we did the calculation that the Government of Yukon has spent almost the equivalent of three people - almost three, not quite three - full-time for the last two years on forestry policy, and they were about to hire a fourth. We have a commission that is going to have three staff focusing on forestry policy - in a few minutes, I will invite the commissioner to speak about some of the things that they have done - and already they have done significant work. It has been well-coordinated. There has been some political guidance and support. It has been coordinated, tight and disciplined. I am proud of the work that they have done already.

There was a ministerial statement today that acknowledges some of the work that they have already done. I do not see anything wrong with the idea of the commissions. When Members have some technical considerations for us to consider and good points to make, I am prepared to consider those. Of course we will consider those. If they make some good points, we will acknowledge them. However, the only thing that this Opposition has done is talk about what they call "million-dollar commissions". They make no mention of the fact that we have reallocated funding from the departments to do this and that, in some cases, the previous government was spending more in these policy areas than we are. Those are all details.

Over the last few weeks, I find what the Yukon Party has said and done extremely objectionable. I think it began with the rather insulting statements first issued from the lips of the Leader of the Opposition.

Let us talk about land claims for a moment. We are going to get into land claims in some detail. The funding that I am requesting was already approved by the previous Management Board. I am saying that I am not increasing the positions in this fiscal year. I am saying that we are reallocating positions in the Land Claims Secretariat to allow for another principal negotiator.

I am not asking for new money that the previous government did not want already. If we had said nothing about land claims and said it was going to remain completely the status quo, I would still be asking for $64,000 in land claims because I would have to meet the commitment of the previous government.

When it comes to transition and transition costs, I was told by staff in the Executive Council Office that this is the least expensive transition that they have seen. We have $27,000 worth of contracts for transition - total - government-wide. Is that an example of free-spending socialists at work? I do not think that is accurate at all.

Virtually every other expenditure here has got a Management Board minute attached to it, every other dime. So, what does that mean? Is that part of the free-spending socialists at work? I think that that, too, is unreasonable.

Let us take land claims as an object lesson here, just for a second. Land claims is requesting approximately $258,000, two-thirds of which is for implementation projects and is recoverable. Sixty-four thousand dollars of that is for salaries of staff that the Yukon Party hired. The only contribution to this budget that we are putting in, that is new, is the contribution to the Association of Yukon Communities, which I felt was a reasonable request. Mayor Watson came to me and made the request. I think it was reasonable. I asked my colleagues and they agreed. That is the expenditure for which we are responsible.

Certainly, we are going to reorganize the Land Claims Secretariat. There are a couple of vacancies there. Not a huge number of vacancies - there are two vacancies and one person I know of who is leaving. The Member asked the question in Question Period. There are two vacancies in land claims - the chief land claims negotiator and two implementation analysts. One got another job before the new government came in. That decision was made before anything we ever did. The other implementation analyst is going to join one of these commissions that the Members like to dismiss. Nobody else has gone. What we will do is take a couple of vacancies and create another principal negotiator position. Why? Because we know that there are more people insisting on wanting to go to the table. Not all the tables are going to run at once, but we want to make sure that good homework is done in the key critical areas and that no principal negotiator has too many files to handle so they get burned out.

That is the innovation. That is the change. None of it involves new funding and no request by this government toward this particular area.

I have quite a few questions to ask the ex-Government Leader.

I have quite a few questions. I have some questions when we get to public inquiries. I have a couple of questions on the ex-Government Leader's policy when it comes to declaring conflicts of interest and whether or not there was a policy in the past that they would take their issues before the conflicts commissioner. I have some questions, and I will ask them when the time comes.

Mr. Ostashek: It is unfortunate the Government Leader is so angry and so thin-skinned. He had his opportunity to ask questions for four years. It is now our opportunity, and it is up to him to answer the questions.

Some Hon. Member: (Inaudible)

Mr. Ostashek: Well, the Member may ask them, but I think he will be out of order by asking them.

The Member opposite went on a big tirade, as he usually does in this House, and he thinks he can intimidate someone. He should have learned by now that he cannot intimidate anyone. No one will be intimidated because he loses his temper and has a temper tantrum in this House.

He has made a lot of allegations and charges, and he took exception to some statements I made, but I have taken exception to a lot of statements he has made. He never agreed with anything we did during the last four years, not the last three months, or anything we said. There is nothing new in that respect.

I have the greatest difficulty with all this political rhetoric that comes from this leader who pretends he is the great messiah who is going to solve all the Yukon's problems because nothing has been done for the last four years.

This is the impression he is trying to leave with the public, but I can tell the Government Leader that he is not fooling anyone. There are a lot of questions that the public would like answered and, as painful as they may be for him, we are going to seek answers to them. He thinks his commissions are a good idea. We are going to point out why we do not think they are a good idea. He says that he has the same number of staff for equivalent caucuses. I disagree wholeheartedly and I will point out why as well.

As I have said, I am not concerned about the amount the government is spending in this budget on their own initiative, but the stage it has set for the future of the Yukon and the amount of spending it has set by this supplementary budget is a concern. He may say that he is going to keep his personnel costs within the same amount of dollars the previous government had, but we cannot see that in this supplementary budget, and he knows that. We will be able to see it when he has one full year to govern. We need to compare apples to apples and not apples to oranges. I would like to draw the Member's attention to the public accounts of 1995-96, which is the last full fiscal year we had.

The spending for Cabinet and support staff total was $864,000. We are not working on projections or estimates of what might have or might not have been this year. That was the actual amount for the 1995-96 year.

That does not necessarily mean that all of that money would have been spent. The Government Leader knows that. It may have been if he was the Government Leader, but we lapsed a lot of funds in the Executive Council Office every year.

He says that the commissions are not going to cost the government any more money. How does he expect me or any Member on this side of the House to believe that? How does he expect anyone in the Yukon public to believe that when he has hired four deputy commissioners at deputy ministers' salaries? How can he say that this is not going to cost the taxpayers any more money? I do not follow his logic on that. That, in itself, is an additional expense, whether it is coming from existing funds or not.

If the Government Leader did not like having to pay out $193,000 in severance pay to two deputy ministers, he should not have fired them. He should not have fired them.

He is kibitzing from his chair and saying he did not. I recall the Government Leader standing in this House during Question Period the other day, saying he was going to go back, check and see if he could table the so-called contracts - the special deals - I had with these deputy ministers. I asked him at the same time if he would file the dismissal letters that these deputy ministers received. I am looking forward to the Minister tabling them, because it will certainly clear the air. One of the deputy ministers said quite clearly - as the Government Leader put it, during a chat with a reporter over a cup of coffee - that he was fired and that he was not offered a position equal to a deputy minister. That is all that the contract was that I had with the deputy minister - that he would be offered another position as a deputy minister.

Some Hon. Member: (Inaudible)

Mr. Ostashek: Table it. I have nothing to hide - absolutely nothing.

Some Hon. Member: (Inaudible)

Mr. Ostashek: No, I will not regret it - the Minister will, and he knows it. I know what one of the clauses in one of the letters is. I have never seen the letters, but I do know about one of the clauses in one of the letters. Quite clearly, the person was dismissed. He was offered another job in government, but not at the deputy minister level. So, let us be clear about that.

So, whether he liked to pay it or not, he had to pay it. Otherwise, he could probably have been sued for constructive dismissal. He knows that, I know it, and the Yukon public knows it, but they are not buying it - that only two quit.

He goes on at great length about the amount of funding requested for land claims. Nobody here criticized the amount of money requested for land claims. What we were criticizing was the sorry manner in which he handled the Land Claims Secretariat and how he demoralized the people in the department, yet now he expects those same people to work for him.

He goes on at great length to say, in the press, that he has the greatest admiration and the greatest respect for these people. Well, he certainly did not treat them with much respect. He did not treat them as professional civil servants. If he had such great admiration and respect for these people, and they did such a great job of following the policies of the previous government, he did not have enough respect for them to think that they were professional enough to follow the policies of his government.

So he starts to remove them. Then he gets some flack from various places. Then he starts changing his mind. Now he has a situation where he has told these people that they are going to stay on the job until they are replaced, whatever that means. Nobody knows who is going to replace them. He makes great, loud noises about setting up these seven land claims tables because absolutely nothing has been done in the last four years.

What a way to demoralize a very professional group of people who have worked their hearts out on behalf of the Yukon citizens and the Government of the Yukon to negotiate a fair and equitable settlement.

We will go over the history of land claims and see what was accomplished. I will read into the record a lot - not all - of the things that were done in the last few years. For that Minister to stand up in public and say that nothing has been accomplished in four years does not show much integrity. What he says has no respect for the land claims people or for what has been accomplished.

I have no difficulty with him saying, "I am going to try to get the rest settled. I am going to try to do a better job. There should have been more done." However, to say that nothing was done in four years is a ridiculous claim. When I get done, before this debate is over, what was done will be on the public record, and it will be in defence of some very good civil servants who worked in some very tough and adversarial negotiating conditions, many of which were brought on by a good friend of the Government Leader.

We were not talking about the money that was being allocated for the land claims people. Not at all. We know that it takes money to settle land claims. We were not questioning that. When I said that we have a big, free-spending NDP government, I meant it.

They started out on that foot. They made a whole pile of commitments out there to constituents, then the Government Leader had to go on the public record to try to dampen everyone's expectations and say, "My God, the finances of government are not as good and rosy as Yukoners thought they were." Now the Government Leader is trying to dampen all the demands of Yukoners because all of the sudden he realizes that he now has to make the decisions and he cannot just stand up in the House and criticize. Well, I am sorry, but the Government Leader does have to make the decisions and we are going to hold him accountable in this Legislature for those decisions.

Mr. Chair, I move that you report progress on Bill No. 3.

Point of order

Chair: Mr. McDonald, on a point of order.

Hon. Mr. McDonald: We still do have some time to debate -

Some Hon. Members: (Inaudible)

Chair: Order please. The Government Leader has the floor on a point of order.

Hon. Mr. McDonald: I realize that the Opposition Leader is going to try to swallow up whatever time we have on the point of order, but there is sufficient time to speak.

If the Member has more that he wants to say, I am certainly prepared to listen to him. I would point out that I will have great joy debating his budget next week.

Chair: Mr. Phillips, on the point of order.

Mr. Phillips: Mr. Chair, there is no point of order for the Member. It is about 5:27 p.m. It is the normal time for us to report progress on the bill and we will be back here on Monday. There will be lots of time for all Members to debate this bill.

Chair: There is a motion that I report progress. Does the motion carry?

Motion agreed to

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

Motion agreed to

Speaker resumes the Chair

Speaker: I will now call the House to order.

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

Mr. McRobb: The Committee of the Whole has considered Bill No. 3, Second Appropriation Act, 1996-97, and directed me to report progress on it.

Speaker: You have heard the report of 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 Hon. Government House Leader that the House do now adjourn.

Motion agreed to

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

The House adjourned at 5:30 p.m.

The following Sessional Papers were tabled December 12, 1996:


Yukon Hospital Corporation Financial Statements for the year ending March 31, 1996 (Sloan)


Business Development Advisory Board Annual Report 1995-1996 (Harding)