191 Hansard

Whitehorse , Yukon

Tuesday, April 18, 2006 - 1:00 p.m.

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

Prayers

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

DAILY ROUTINE

Speaker: Tributes.

Introduction of visitors.

Are there any returns or documents for tabling?

Are there any reports of committees?

Are there any petitions?

Are there any bills to be introduced?

Are there any notices of motion?

NOTICES OF MOTION

Mr. Rouble: Mr. Speaker, I give notice of the following motion:

THAT this House urges the Government of Yukon to implement a Yukon tourism brand strategy in partnership with industry, First Nations and communities to ensure the continued growth and development of the Yukon tourism industry.

Mr. Hardy: I give notice of the following motion:

THAT it is the opinion of this House that

(1) examples of weekly food allowances for persons on social assistance with the Department of Health and Social Services are $37 for one person and $185 for a couple with three children;

(2) rates for food allowances have not been changed for well over a decade and are below all measures of poverty;

(3) nutrition is extremely important for the health and well-being of adults looking for work and for children in school; and

THAT this House urges the Yukon government to immediately review and alter the food allowances for families on social assistance to better reflect actual needs.

I give notice of the following motion:

THAT this House urges the Government of Yukon to put in place a Yukon-wide ban on smoking in public places by immediately introducing legislation to make it unlawful.

I give notice of the following motion:

THAT it is the opinion of this House that

(1) many Yukon grandparents are actively parenting their grandchildren in their own homes;

(2) other grandparents are blocked from seeking custody or access to their grandchildren;

(3) the vital, nurturing role of grandparents goes unrecognized and unpaid by this government; and

THAT this House urges the Government of Yukon to support Yukon families by passing legislation that defines a distinct process for grandparents who apply to the court for access to, or custody of, their grandchildren and by developing a financial compensation policy for grandparents who are parenting their grandchildren.

Mrs. Peter: I give notice of the following motion:

THAT this House urges the Government of Yukon to provide the Department of Environment with the mandate and the resources needed to protect the Yukon's environmental integrity for future generations.

I give notice of the following motion:

THAT this House urges the Government of Yukon to maintain the disposition process under the Oil and Gas Act in its current form, until First Nations and all other Yukoners have been consulted about how to minimize the environmental, social and cultural impacts of oil and gas activity while also ensuring that Yukon people will derive the maximum economic benefit from such activity now and in the future.

I give notice of the following motion:

THAT this House urges the Minister of Health and Social Services, in conjunction with the Minister of Community Services and the minister responsible for Yukon Housing Corporation, to direct the two departments and the corporation to hold public information sessions in all Yukon communities to provide factual information about the health risks associated with black mould, how to identify the presence of black mould in homes and public buildings, and what procedures to take if it is found.

Speaker: Are there any notices of motion?

Is there a statement by a minister?

This then brings us to Question Period.

QUESTION PERIOD

Question re:  Nurse shortage

 Mr. Hardy: Despite our recent snow, the Yukon 's tourist season is right around the corner, and that means thousands of visitors and residents driving our highways, camping, boating and hiking throughout the territory. Summer is the busiest season for community nurses as they deal with high numbers of injuries and general illnesses. Yet in communities such as Carcross, Carmacks, Mayo and Ross River, there is only one full-time nurse when there should probably be two.

How is the Minister of Health and Social Services preparing for the heavy workloads community nurses will face as the population expands?

Hon. Mr. Cathers:   I'd like to draw the member opposite's attention to the health and human resources strategy announcement that we've made. We're very cognizant of the increasing pressures upon our service personnel within the department with regard to the increases not only in population but the demographic change of an aging population. We are taking these steps right now. We're also aware of the nation-wide shortages of health personnel, and that is why we've developed a health and human resources strategy which I point out again is $12.7 million over five years.

Mr. Hardy: Our information regarding this situation is a little different than that of the minister, and from a different angle. In Faro, Teslin and Old Crow, if one full-time nurse is sick, on holidays or just exhausted, the other nurse gets help only if a relief nurse is available.

Beaver Creek and Destruction Bay are one-nurse stations relying on relief nurses to provide some well-deserved time off. Pelly Crossing has only relief nurses - none are permanent. Relief nurses are hard to find - there is no question about it - and they are only available sporadically. Why is the department advertising for auxiliary on-call positions that don't appeal to professional nurses who want full-time positions with the benefits of permanent status? Why are they doing that?

Hon. Mr. Cathers:   I hope the member opposite is aware that we do have a requirement to operate within the guidelines of the Public Service Act and in conjunction with the Public Service Commission. There are certain processes that have to be followed with regard to that, and I certainly don't get involved in personnel matters. As the member is aware, we cannot do so.

What we are doing, and what I am working on with the department, is working together to attempt to attract more personnel and to make the situation here in the territory more conducive to having them stay here. Particularly with regard to the rural communities, as raised by the member opposite, we are well aware of the challenges with getting people who will come and stay in certain rural communities because of their lack of proximity to some of the amenities that people from urban centres down south would be used to.

Mr. Hardy: I'm not sure if the minister listens to the question. Obviously he doesn't. If he did, he would have given a different answer.

The reality of staffing in community nursing stations is very grim. For instance, Dawson City should have five full-time nurses and an extra one for the busy summer months. The real picture is this: one nurse is full time, and two others work less than full time. There is seldom any relief and for short periods of time. The Dawson City nursing station is often staffed with only two nurses for weeks at a time, and sometimes there is only one. This not only leads to burnout and resignation, it creates unsafe conditions for both patients and nurses. The situation is getting worse because of the inactivity of this minister.

Will the minister commit to a thorough evaluation and come up with a reasonable plan to alleviate the disturbing situation before there are any serious repercussions in rural Yukon communities.

Hon. Mr. Cathers: I am pleased to see that the leader of the official opposition seems to think we have a crisis developing and that it has all developed in the few months under my watch. That's not the case; this shortage of nurses has been coming for years. We face challenges. One thing the member opposite should be aware of is that in some cases there are actually nurses who prefer to work part time. There are some we are attracting from Outside on locums. I don't get involved in the details of telling them how to operate within the confines of the Public Service Act, and I cannot do so. I am working with the department on addressing the issues. The member opposite should take the time to read the legislation and be aware of the restrictions with which we must comply.

Question re:    Emergency preparedness

 Mr. Hardy: Sad.

Mr. Speaker, on January 29, much of the Yukon experienced a power outage that lasted for several hours. As the blackout continued on that freezing Sunday afternoon, many people got more and more anxious about when their lives would get back to normal. A lot of concern has been raised about how our emergency services organization functioned during that event and afterward. One of the major concerns that was brought up was the way public communications were handled. People who were already in the dark because of the power failure were also kept in the dark about what was happening to fix the problem.

What has the Minister of Community Services done since January 29 to make sure any future emergencies like this were handled a lot better?

Speaker's statement

Speaker: Before the Minister of Community Services answers, leader of the official opposition, just to remind you please, do not comment on the previous questions. I think you understand.

You have the floor, Minister of Community Services.

Hon. Mr. Hart: That day was also a very unusual day in the Yukon with regard to the power outage. We were working. We have done a briefing with the municipality - that is, the City of Dawson . In addition, we had briefings with the press with regard to the emergency measures operations during and after that event. We worked very closely with the City of Whitehorse and Yukon Electrical Company in coming up with a plan for all of the Yukon - not just the City of Whitehorse.

Mr. Hardy: Mr. Speaker, an internal review did take place involving the Emergency Measures Organization and various government departments and the electrical utilities - just to help the minister across the way - but members of the public were not invited to take part. I asked if they would do it, and they said no. The minister still hasn't provided a detailed report about what went right, what went wrong and what needs improvement. The people are still left in the dark, and they're very concerned about this. Does the minister have any plans to seek public comment on how the utilities, government departments and EMO responded to what could have been a life-threatening situation?

Hon. Mr. Hart: As I indicated, the department, along with Yukon Energy Corporation, did a very closed briefing of the situation that happened that day. Extensive work was done to see what was done right, what was done wrong and what we have to be prepared for next time, to ensure we get a better and closer relationship.

One of the big issues that came out of our review is that it will have to work a little closer with the City of Whitehorse officials as well as Yukon Energy Corporation officials.

Mr. Hardy: But, obviously, not the citizens of the Yukon . Many people felt very vulnerable during that lengthy blackout. Seniors living on their own, people with special medical needs, single parents with infant children and people with limited mobility all faced special challenges. What they got from this government amounted to a collective shrug and some patronizing statements by EMO officials that sounded a lot like blaming the victim - and that was very obvious.

Neither the Premier nor any of his ministers came to their offices to pitch in and help. We saw the chaos and anxiety that can result from lack of proper information during an emergency. There have been fairly recent examples around the world and in Canada.

Will the minister direct his EMO officials to hold a series of public meetings so that people can learn what to expect the next time there is an emergency, and also give valuable feedback on how communication can be improved before, during and after such an event?

Hon. Mr. Hart: I don't know if the member opposite has ever been in a kitchen - if he can't cook, then too many cooks in the kitchen aren't going to do you any good.

It's no use us coming out here - I'm not an electrician. I can't turn on a generator; I can't operate a generator; what good would I be in that particular aspect?

Under the EMO process, we had a plan set up to go. I mentioned it in the House previously. We had a program. We had a community that looked like it would be in danger, and that was Carmacks. An implementation plan was put in place for Carmacks. We had an action plan ready to go for Carmacks.

As for the member opposite advising the public, commencing in May of this year, we are going to go out to the public to announce things with regard to providing education for the general public on what things they can do to be prepared for emergencies such as the power outage.

Question re: Dawson City financial situation

Mr. Mitchell:  Mr. Speaker, I have some questions for the Minister of Community Services. I had the opportunity to be in Dawson this past weekend to attend the Dawson City International Short Film Festival. There were a number of great films and lot of discussion about a local horror movie - Dawson's outstanding debt.

I spoke to a number of people who are interested in running for council when an election is held. They all have one outstanding reservation - they will not run until they know the status of the debt. The Yukon Party government has refused to answer this question for the last three years. If we are going to have a real election, people need real numbers.

When is the Yukon Party government going to bring forward this financial package for Dawson City, and how much will it be?

Hon. Mr. Hart: Mr. Speaker, as I indicated to the member opposite on several occasions on previous questions on this matter and in this House, we are currently working on that particular aspect right now. As I have also indicated, I will be providing to the House, hopefully, prior to the election being called in Dawson , a package for the City of Dawson .

Mr. Mitchell:  Mr. Speaker, that is not really good enough. If the minister would answer the question at some point, we would stop asking it. Everyone wants to see an elected government in Dawson. I was told over and over again that people would not run if they were not given adequate time to get a good look at the books. The Premier has said several times that five options are being looked at for a financial package to get Dawson back on its feet. We have asked over and over again for the minister to make those options public. He has refused. I believe the people of Dawson have waited long enough for an answer.

When is the Yukon Party government going to bring forward a financial package, and how much will it be?

Hon. Mr. Hart: For the member opposite, I will reiterate what I have said before. We are working on that plan. It will be brought forward prior to the election call for Dawson City.

Mr. Mitchell:   This government seems to have millions of dollars for railroads that have no private-sector backing. It has $400,000 for ports. It has $793 million to spend, and yet it has no money to get Dawson back on its feet. These are the priorities of this Yukon Party government. There have been a lot of different numbers floating around. We know that Dawson currently has a debt of over $4 million. It will not be able to operate on its own, and candidates will not come forward to run until that number is brought down to somewhere between $1 million and $1.5 million. That means the Yukon Party government has to come up with $2.5 million to $3 million. When is this government going to bring forward this financial package and will it be for that amount of money?

Hon. Mr. Fentie: The first thing that the government side will articulate is we will ensure that Dawsonites are not held liable nor responsible for the debt incurred through the decisions made by the former Liberal government. That's item 1.

Item 2: we will ensure that Dawson's cost of heating potable water, because of the decision by the former Liberal government to proceed with the Mayo to Dawson inter-tie, is not absorbed by Dawson City.

Item 3: shortly, we will table a financial plan for Dawson that will put Dawson City on sound financial footing long into the future. Again, this government is fixing problems from the past, and unfortunately the members opposite fail to recognize that the debt that Dawson carries today, to a large degree, rests with decisions they made vis-à-vis Management Board minutes. We all know that. We're solving the problem on behalf of Dawson.

Question re: Dawson City financial situation

Mr. Mitchell:   Well, Mr. Speaker, same minister, same questions.

Last week the Yukon Party Web page had some information about Dawson. It said that anyone who thought of running for Mayor of Dawson would be foolish to do so without knowing the status of the financial picture. I'll file that document for members to read.

For once I agree with the Yukon Party Web site. As we've noted, there's no money for debt relief in the $793-million budget that's before us. Any money for Dawson is going to be an afterthought. That is how Dawson City has been treated by the Yukon Party government - as an afterthought. Will there be another IOU with no legislative authority? How does the minister plan to get legislative approval for this money that he says is coming, or is it going to be simply another IOU that the next government is going to have to pay?

Hon. Mr. Fentie: Speaking of IOUs, the Yukon taxpayer is actually paying an IOU left to us by the former Liberal government. We ensured, every step of the way, that Dawson had the resources necessary to operate their affairs. It is this government that stepped in and put in a trustee, did the forensic audit to get to the bottom of the issues that Dawson faces. Today, Dawson is actually in a position where we can deal with the debt accordingly.

As I said, the government recognizes that a large portion of the debt rests with the former government's decision. We will address unique challenges in operation and maintenance. We recognize there are immediate capital needs in the City of Dawson . We will ensure that is part of the financial plan. If the member opposite ever wants to become Finance minister, he had better brush up on supplementary budgets, because that is how government operates.

Because today's budget does not reflect Dawson's financial bailout is of no reflection on all the money this government has expended to assist Dawson since taking office.

Mr. Mitchell:  We can continue to play the blame game and play politics, or we can look forward and make some decisions to solve the problems.

Last week we talked about several promises that the Yukon Party government has made that are not in the budget. They are just IOUs. There is $1.25 million for the college pension fund that is not on the books yet. There will be millions more for the hospital pension fund. Again, that is not on the books. Now we are looking at probably $2.5 million to $3 million for Dawson that will likely be an IOU for the next government to pay. The Finance minister says that we will have supplementary budgets. We just tabled a big budget but we couldn't do the homework to put the IOUs into the budget so they wouldn't be IOUs.

How much is the bailout for Dawson? When is it going to be announced, and how does the minister intend to pay for it?

Hon. Mr. Fentie: Well, Mr. Speaker, as I pointed out, this government intends to pay for it - unlike the past government, which did leave the IOU.  Furthermore, this government books all its liabilities - once again, not leaving an IOU for the Yukon taxpayer. It was clearly demonstrated through the Auditor General's reporting - no longer qualified audits.

Furthermore, the member opposite is fixated on the fact that there may be further expenditures by the Yukon government in the coming months and years. Of course there will be, and that is the challenge of sound fiscal management. That's why we have cash in the bank, unlike the former government, which had no cash in the bank and was actually paying overdraft charges to deliver programs and services. That was an IOU; no longer are IOUs in the territory that rest with the government's responsibility.

Mr. Mitchell:  Mr. Speaker, this government is busy in the last few months of its mandate, trying to be all things to all people. It's busily signing cheques and staging photo ops, committing money that is not yet budgeted. The next one coming is Dawson. There's a ballot on the way, and it will be in the order of $3 million. This will bring the municipality's debt down to a more manageable level. There's only one problem, and that's the fact that the government has not got the means to pay for it. We've arrived at this point because the decision to finally do the right thing and help Dawson get back on its feet is an afterthought. Better late than never, I guess.

So I'll ask one more time to either minister: how much is the bailout for Dawson , when is it going to be announced, and when will the minister tell us how he intends to pay for it?

Hon. Mr. Fentie: Well, Mr. Speaker, let me again remind the member opposite that we have tabled a bill ensuring an election will be called on or before June 15. So obviously, between now and then, the financial package for Dawson City will be complete.

But, Mr. Speaker, let's get down to the issues here. When it comes to IOUs, bailouts and all the things that the member opposite points to this government as having as an afterthought, who stepped in to resolve the Mayo-Dawson inter-tie debacle? This government, ensuring that small contractors got their payments, as they should have. Who bailed out the City of Dawson over the last three years? Who put in the trustee? Who did the forensic audit? Who resolved the issues at the Energy Solutions Centre? Who has fully booked all liabilities of the Yukon government, unlike past governments? It's this government, Mr. Speaker. These aren't afterthoughts; they're called financial management.

Question re: Dawson City forensic audit

Mr. Jenkins: I have a question today for the Minister of Community Services on Dawson City. The trustee's role in Dawson City is, among other undertakings, to protect the assets of the city. The trustee reports directly and receives direction from the minister. The forensic audit was a very revealing document, tabled under the protection of this Legislature, that outlined extensive financial irregularities carried out by the former mayor and the city's top two officials.

My question to the minister: why has the minister, either directly or through the trustee, refused to proceed civilly against the former mayor and officials to recover taxpayers' money?

Hon. Mr. Hart: I'll again repeat the answer I provided to the member opposite previously with regard to this question. We are acting on the advice of independent legal counsel with regard to this particular case, and it is currently under investigation by the RCMP. We are awaiting those results.

Mr. Jenkins: We have a forensic audit that may or may not be in effect the reality. That appears to be the major reason it was tabled in this Legislature. Apart from that, the city has in place, under its crime section and its insurance program, employee dishonesty coverage. The limits are usually $100,000 per employee. Why has the minister, either directly or through the trustee, not put the insurers on notice that they will be seeking to recover taxpayers' money identified in the forensic audit from the city's insurance carrier?

Hon. Mr. Hart: We are working with the trustee, and have been since he was inducted to Dawson City to look after their affairs. We are working through the process to ensure the citizens of Dawson have a very good financial base and, as the Minister of Finance indicated, we're working on the financial package that will allow them to have a functional municipality.

Mr. Jenkins: There was an opportunity but that opportunity is gone, because the timelines around the insurance policy have expired because the minister was asleep at the switch and didn't instruct his trustee to undertake this initiative. Why is the minister not cleaning up these matters and why is the minister leaving these decisions to a new council? Is this part of the teach-Dawson-a-lesson undertaking that Community Services has in mind?

Hon. Mr. Hart: I will just reiterate for the member opposite that we took his advice with regard to some of that information he spoke of. In essence, I will try to keep this calm and cool. We are looking at trying to bring Dawson back so it has a functional municipality. That is our intent; it has been our intent from the beginning. As the Premier also stated, we have had to enact several items in order to get to the stage we are at today.

Yes, it took a long time, Mr. Speaker. For the members opposite, yes, it took a long time. But it took a lot longer time to get a lot of the information done than was previously identified by the professional people. So, it took a lot longer. To give the member opposite an example, the forensic auditor told us when we talked to him that it would be three to four months. It took a year - a year - because they couldn't get the appropriate information in order to get his detailed analysis. In essence, here we are today. I hope to have something before the House to present for the citizens of Dawson.

Question re:    Whistler-blower legislation

 Mr. Hardy: Way back in 2002, the Yukon Party promised to implement effective whistle-blower legislation that protects the anonymity of public employees who report abuse within the government. For nearly four years we have seen delay after delay and excuse after excuse. Will the acting minister responsible for the Public Service Commission favour the House with the latest excuse for why this election promise has been broken?

Hon. Ms. Taylor:  The member opposite knows full well that creation of whistle-blower legislation was a commitment that was outlined in our party platform in the year 2002. Our government is prepared to move forward, as the member opposite knows full well. We have extended the olive branch across the tree to the members opposite. Unfortunately, we have been unable to garner all-party consensus on this particular basis in coming up with a select committee that would be representative of all parties.

In fact, we tabled a motion with both parties opposite outlining a proposed motion. Again, unfortunately, we did not receive all-party consensus.

Mr. Hardy: Mr. Speaker, it is now exactly one year, one month and two days since I advised the minister that the official opposition was ready and willing to take part in a select committee to look at options for a whistle-blower protection bill. As a matter of fact, the NDP even brought one in to help this government along. I'm going to table a copy of that letter and others to remind the minister of our commitment. The third party, of course, would only cooperate in exchange for something else.

In December, the government House leader promised to address that red herring and set up a committee on appointments and a committee on whistle-blower legislation. Four months later, we are still waiting for that - four months. Why is the minister hiding behind the Liberals as an excuse for not moving forward on legislation to protect the rights of government workers who expose abuse within the system?

Hon. Mr. Cathers:  As the House leader for the government, I would remind the leader of the official opposition of the facts and urge him to check the correspondence and recall what actually occurred. We have been attempting since we took office to gain the agreement of the other two parties to move forward. We stated right from the start that we believe whistle-blower legislation requires all-party engagement to be an effective and fair process.

Unfortunately, for the bulk of this term, the Liberal Party was trying to set certain conditions on things that were not acceptable, and we were not able to proceed at that time. When I took over as government House leader late in the last session in the fall, the Liberal Party, under their new leadership, did express an interest that they would participate - pursuant to the offer which I had reiterated - and then the NDP was reneging on previous commitments and trying to set new conditions. We don't think there is a genuine intent from either party to proceed forward working with us and we are, frankly, very disappointed in them.

Mr. Hardy: Mr. Speaker, that minister is completely incorrect. The NDP has never reneged on any commitment. I just tabled the correspondence to prove it. Maybe he should read it and he would understand what the real matter around this is instead of trying to create a different impression out there.

The Liberals had two years to bring in whistle-blower legislation. They did nothing. This government has had almost twice as long, but it has done nothing - that's a fact. It's obvious that any government worker who wants to follow their conscience can't count on any support from the Yukon Party or the Liberals. Why has nothing happened? Accept responsibility. The question is: is it game playing, incompetence, or did the Yukon Party never intend to keep the promise it made to the public in November 2002?

Hon. Mr. Cathers:   In answer to the leader of the official opposition, he does need to review his information. Perhaps he should talk to the former NDP House leader - the new Liberal - the Member for Kluane, and ask him what representations he made at House leaders' meetings. Again, I reiterate to the member that we have been attempting to proceed with the members opposite. We had until the last day of the fall sitting, when the members opposite responded and said they would be prepared to consider such a motion if we extended the sitting by another day. We regarded that as gamesmanship from both parties, and we are not able to proceed in partnership if the other two partners are not willing to come to the table.

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

ORDERS OF THE DAY

Notice of opposition private members' business

Ms. Duncan: Pursuant to Standing Order 14.2(3), I would like to identify the item standing in the name of the third party to be called on Wednesday, April 19, 2006 . It is Motion No. 515, standing in the name of the Member for Porter Creek South.

Mrs. Peter: Pursuant to Standing Order 14.2(3), I would like to identify the items standing in the name of the official opposition to be called on Wednesday, April 19, 2006. They are Motion No. 455, standing in the name of the Member for Vuntut Gwitchin, and Motion No. 615, standing in the name of the Member for Mount Lorne.

Speaker: We will now proceed to Orders of the Day.

ORDERS OF THE DAY

 Hon. Mr. Cathers:   Mr. Speaker, 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

COMMITTEE OF THE WHOLE

Chair: Order please. Committee of the Whole will now come to order. The matter before the Committee this afternoon is Bill No. 20, First Appropriation Act, 2006-07.

Before we begin, do members wish a brief recess?

All Hon. Members: Agreed.

Chair: We'll take a 15-minute recess.

Recess

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

Bill No. 20 - First Appropriation Act, 2006-07 - continued

Hon. Ms. Taylor:  When we left off in general debate the other day, as I recall, there had been a fair amount of discussion on the budget - including components of the budget that came from discussions that took place during our community consultations last fall. I believe that it outlined for the members opposite quite a large overview of some of the communities that we had visited and some of the activities that had taken place in each of our community consultations.

Mr. Chair, just to reiterate for the members opposite, we are very pleased to provide yet another very strong budget that includes money that continues to put Yukoners to work. It builds upon a very strong economy while recognizing the fiscal prudence that this government, under the watch of our Premier, has been exercising over the last three and one-half years. This year is by no means an exception.

Mr. Chair, the capital budget that we have tabled is approximately $191 million. It is the second highest budget in Yukon's history. Many of the items within this budget reflect the important issues that were raised during our community consultations, while again recognizing our very strong fiscal financial management record for the last number of years. We are very pleased that this budget contains no tax increases. In fact, the tax announcements that we have been making over the last three years have all been surrounding tax reductions, including a decrease of the corporate tax rates for Yukon businesses.

There is also a lot of discussion surrounding openness, accountability and transparency. Again, this has been something the Government of Yukon has been able to demonstrate over the last number of years, which has been reflected by comments made by the Auditor General of Canada earlier this year when she gave the Government of Yukon a glowing report in terms of a very strong financial bill of health, in terms of moving toward full accrual accounting, meaning that all our financial books or records fully reflect all the assets and liabilities of the government, again recognizing the Yukon government for implementing higher standards of accounting, as well as for the steps taken to ensure accountability and public confidence in the government.

We are very pleased to be able to present this budget. Certainly as the minister responsible for Tourism and Culture, I would just like to reflect on some of the initiatives that we have been following through with at the direct request of industry and tourism stakeholders across the territory, whether that meant dollars, enhanced investments in media relations, Web-site enhancements, as well as familiarization tours, whether that was continued investments in product development, and there is actually an increase in product development this year - again, monies implemented toward the development and implementation of a Yukon tourism brand strategy, which we will be launching formally later on today.

Again, the national marketing campaign associated with the Canada Winter Games 2007 - a very exciting event and one that will further put Yukon on the map, on the national and international stage.

We are very pleased within this budget to provide the second million of the Yukon government's contribution toward this pan-northern national marketing campaign. Again, it builds upon investments in media campaigns, such as our scenic drives, inclusive of the interpretive signage, marketing cooperative initiatives and so forth.

So again, we are very pleased to put forward this budget, and we were very pleased to again take part in our third annual community tour, for which we received much great feedback that is reflected in this budget.

Mr. Hardy: The minister touched on a lot of points. We'll look at a few of them. I won't be going in long detail on some of them. I do want to make sure my colleagues, the leader of the third party and my other colleagues on this side, get an opportunity over the next while to participate in general debate. I'll be entering back into debate over the course of that period. We consider general debate a very important part of the debate of the budget - not just departmental, but also general debate, which allows us to take a look at it in a broader context instead of being focused on just a department or a line item. So we feel it is extremely important to have discussion during this period.

The minister touched on a few points. Let's look at one of them. The minister mentioned the capital budget of $191 million. Can the minister explain to me what a tangible capital asset actually is? Does she know?

Hon. Ms. Taylor:  As I understand it, tangible capital assets are assets that are over a certain value, as determined by the Auditor General of Canada , with a certain threshold and financial dollar attached to them. In this particular case, it's any asset that would be over the cost of $20,000.

So, within this budget for 2006-07, we have tangible capital assets marked at just over $79 million. It is a fairly large figure and one that is fully transparent.

Mr. Hardy: Could the minister tell me, would that not be a better prediction of what the actual capital budget is?

Hon. Ms. Taylor:  In terms of capital assets, I just want to reflect on some numbers the Department of Finance officials presented us with last week. I referred to them in response to the leader of the third party in his comments that came forward in general debate last week. If one takes a look, over the course of the last, let's say, five years, and you actually breaks it down, the percentage of the tangible capital assets as a total of the complete assets of the Government of Yukon - you'll see there's an actual growth in the numbers as compared to where we were in 2002-03.

For example, the tangible capital assets were 13 percent of the total capital expenditures; it has grown. In 2005 it was 50 percent, so we are making some marked improvements. In terms of maintaining accountability, which I would be very happy to outline for the members opposite again, we are fully open and transparent. We're in full compliance with the public sector's generally accepted accounting principles. We've moved to full accrual accounting for the budget, as well as the financial statements, in accordance with the Public Sector Accounting Board guidelines.

For the third year in a row, we have received great, glowing reports from the Auditor General of Canada, who has given our government an unqualified financial bill of health, something that is relatively new for the Government of Yukon.

So again, Mr. Chair, I guess what I would point out is we certainly are listening to the Auditor General of Canada, and we are very comfortable that she is very comfortable with the financial state of health of the Yukon.

The Department of Finance has just pointed out that the recent public accounts report of March 31, 2005, actually outlines a full definition of “assets”, inclusive of tangible capital assets - including buildings, roads, equipment, et cetera, whose useful life extends beyond the fiscal year and are intended to be used on an ongoing basis for delivering services, et cetera, et cetera. And it actually has an outline of all the asset categories, so the member opposite can refer to this on page 50, I believe it is, on the public accounts, 2004-05.

Mr. Hardy: Mr. Chair, I appreciate the advice of the minister. So if that is the case and it is described, would the Finance minister then say that the $206,000 for the Chisana caribou herd recovery project is a tangible capital asset?

Hon. Mr. Fentie: Mr. Speaker, nobody has ever said that investment in the Chisana caribou herd was a tangible capital asset. Nobody has ever said that the community development fund was a tangible capital asset. These are examples I bring up because, although they may not be listed as a tangible capital asset, they are listed as capital, as they have been in budgets for a long time in the territory, and we have done nothing out of the ordinary, other than considerably increase the capital investment in this territory.

Mr. Hardy: As the minister so aptly points out on many occasions, he doesn't necessarily want to follow what was done in the past. It is convenient to use that excuse, but he is forging some new roads in accounting.

I am not questioning the $206,000 for the caribou herd recovery project. I think that's an honourable thing for this government to do. I applaud them for that kind of investment. I guess what I'm trying to sort out is, should it be listed under a capital budget? The $7.35 million for home ownership loans offered by the Yukon Housing Corporation - should that be listed as a capital project, or do we need to take a look at listing them differently? I am not necessarily criticizing the government in this regard. If it has been done in the past, maybe it is something we need to take a serious look at to better reflect what other jurisdictions do across Canada so we are more in line with them.

Hon. Mr. Fentie: This side of the House is never averse to talking about new, innovative ways of doing things when it comes to governance, and we would be more than willing to have discussions around that. I want to bring the member back to the definition of “tangible capital assets”. That's one thing. The booking of capital items in a budget is entirely another thing. One could always make the case that there are many investments that do not fit within the definition of “tangible capital assets” that are definitely defined as “capital investment”.

Maybe the member would like to talk about a simpler way of doing things. One vote - is that something that the official opposition want to give consideration to?

 Mr. Hardy: Actually, exploring this - well, a lot of it comes from the reporter who took a look at the tangible capital assets, the capital budget, and the O&M budget and where it is identified and put under. Some comments were made by a public servant who was very candid and, I think, very straightforward in doing his work. He almost talks about - and I'm not implying anything, but it almost brings to mind why we want whistle-blower legislation, so that there are no repercussions because a public servant is straightforward about what is and what isn't happening.

It is my understanding that Finance has written three letters to Management Board in regard to transfer amounts and amounts up to $35 million. I think when we are aware of that, it needs to be recognized that there are better ways to do things. I hope this government continues to try to do a better job of reporting to the public what is happening with the finances. Possibly some areas where spending has been put into the capital budget need to be questioned. There is no question about it - the figures are all there. But is it legitimate that an O&M expense, or something that you can't even measure as a tangible capital asset, sits in the capital budget projections and not under O&M? It is an interesting way to look at it. I'm wondering, in regard to letters that were written to the Management Board, has this government considered that?

Hon. Mr. Fentie: Let me remind the leader of the official opposition that the letters were written to successive governments as far back as the 1990s. Furthermore, if the member wanted to take the time to look through public accounts, the member would then see clearly that the government is not booking tangible capital assets that are indeed not tangible capital assets - nothing of the sort.

We are booking the finances of the territory, separated by capital investment and by O&M investment. We have been given a clean bill of health now for the last couple of years - the last three years - by the Auditor General because of how we're booking the finances of the territory.

If the member wants to continue to debate this issue, the question then arises: is the member interested in a budget that we table in this House that is merely one vote, which is a combination of capital and O&M? I think it's fair to say that the issue the member has picked up is the result of an article in a newspaper, which erroneously reported that the capital budget was overstated. That is entirely incorrect.

I think it's fair to say that the capital budget has clearly been increased under this government's watch, and that may cause some concern to individuals who would oppose this government's principles and approach to building the territory's future. However, at the end of the day, we will continue to follow all public sector accounting guidelines. We will continue to take our direction from the Auditor General's Office.

We are the first government to actually fully report all the liabilities of this territory, which has been the case in each and every budget we've tabled. That is why we've received unqualified audits, unlike past governments, which were continuing to receive qualified audits because of their reporting approach.

At the end of the day, capital investment is important, but so is O&M. The real issue here dates back to some time ago, when there was this perception that capital was good and O&M was bad, no matter what.

We've increased the stimulus in this territory, whether it be through operation and maintenance, through program and service delivery or through capital investment, by hundreds of millions of dollars. That is one part of our plan to turn this territory around, rebuild its economy, get our population growing again and build a better and brighter future for Yukoners. Whether it's defined as a “tangible capital asset” or a “capital investment” is not something we dwell on. We dwell on a better and brighter future for all Yukoners.

Mr. Hardy: I would like to advise the minister opposite that he should dwell on it, because accurate reporting is the foundation of accountability. I don't necessarily see that in this case. When things are pointed out - he is right; I read the article and I think it was a legitimate article.  I believe that the comments that were made by the public servant should not be put down. I believe the public servant had a right to make those statements, and if a person makes those comments, I don't think the minister's role is to find fault with him, criticize those comments or belittle him because it was in the newspaper. It doesn't mean it is wrong just because a reporter reports it. I hope we are not going down that line.

The minister loves to use the Auditor General and the one thing they seem to have done, which is going to full accrual accounting. That's fine, but that doesn't imply - I hope he is not implying either - that the other governments were corrupt, that the other governments were doing something that was dishonest. The other governments did not totally comply with that one little section about full accrual accounting that the Auditor General wanted all governments to move toward. This government did it; that is fine, not a problem. But there shouldn't be implications that the other governments were somehow operating in a manner that was unacceptable or misleading in any way, shape or form, because I don't think that is the case; otherwise that would have been 25 or 30 years of that with nothing happening. That would be pretty strange.

The other thing is that the minister likes to shift it to how they stimulate the economy. I know there was an election promise in 2002. Spending is one way to stimulate the economy.

Once again, I just have to maybe help the minister on what has happened, who has stimulated the economy and where the money has come from.

In 2000-01, in which the minister was a member of the government, the territorial revenue that was generated was 18.24 percent. The transfer from Canada made up 81.76 percent. In 2001-02, territorial revenue made up 16.39 percent. Transfers from Canada made up 83.61 percent. It started going up. When the people of this territory tried an experiment called “a Liberal government”, the immediate result was that the reliance on federal government transfers took quite a substantial jump - almost a two-percent jump in one year, and territorial revenues dropped almost two percent. At about that time, the people of this territory realized that something was going wrong.

In 2002-03, territorial revenue under the Liberal government went down to 13.59 percent. Under an NDP government, territorial revenue was at 18.24 percent. Under the Liberal government it dropped almost five percentage points that were being generated by the territory. Transfers from Canada had jumped to 86.41 percent - again, equivalent to a five-percent increase.

In 2003-04, territorial revenue rebounded a little bit and went to 15.1 percent, but the transfers from Canada were still higher than when the NDP was in - 84.99 percent. In 2004-05, it completely dropped again. The reliance on Canada took a hefty jump to 86.18 percent. Now, that still doesn't match the Liberal reliance upon the federal transfers.

I kind of suspect the poor Yukon Party government was struggling under the weight the Liberals left the territory with. I know it was a heavy burden for them to carry, Mr. Chair. We all feel it around the territory still.

The territorial revenue that was being generated was down 13.82 percent. Businesses just couldn't handle the Liberal government's rule and were still struggling to get back on their feet. Going up into 2005-06, they're still struggling and still dropping, down to 13.24 percent of revenue being generated in the territory, with transfers going up to 86.76 percent.

So we're still at the 86 percent and the projections are that that will continue into this budget and into the next year. Our reliance on transfers from Canada is still at 86.76 percent or 86.60 percent.

I want to be really fair: this chart I have here very clearly demonstrates the struggles the territory went through under the two and a half year experiment. Without a doubt, the Yukon Party government made a promise to stimulate the private sector, generate more revenue and get less reliance upon transfers from Canada . Unfortunately, the pattern hasn't changed. I think there was a slight shift, but it seems to have bounced back to the worst period of the Liberal government.

It doesn't point to a territory that is finding its feet and starting to generate a greater amount of territorial revenue, because the territorial revenue, as a percentage, has continued to drop. We're getting closer and closer to the 12-percent range, and that's quite frightening, when you think about it. Our reliance upon the federal government is a big concern.

Of course we've had a federal government change. If the minister wants to comment on this, I would look forward to listening to it. But I'm also curious about his negotiations last week with the new federal government and what he anticipates for the future - if he feels that any of the projections that have already been made need to be revisited because of either favourable discussions with the new federal government, or maybe not so favourable for the future of this territory.

Hon. Mr. Fentie: First, I want to go right back to the beginning of the member's dissertation and correct the record. At no time does the government side put down officials. Furthermore, we didn't put down the content of a newspaper article. Clearly we demonstrated that the headline was incorrect, which read, “Fun with figures: Yukon's capital budget is overstated by $110 million”. The headline was incorrect; nobody is disputing the content of the story. Reporters are reputable and do the best they possibly can with the information they are provided. But at the end of the day, headlines can skew what is in the content of the story. That's unfortunate, because it was a good story. The official who is mentioned had been bringing this issue up to successive governments, Mr. Chair, as far back as the 1990s. This is not news; this is an official doing his job as he should, and we are much the better for it. 

The leader of the official opposition is somehow trying to make comparisons through percentages on where the territory is at, as I understand it, economically. But the member is off on a track that does not demonstrate what has transpired in this territory.

To understand fully those percentages, we have to go back to 1995 when the then federal Liberal government was bent on reducing the national debt. They expected that every jurisdiction - provinces and territories included - would assist in the reduction of the national debt.

But the argument that per capita investment doesn't work in the north - it didn't work for the federal government when they made their cuts. With every province, they made their cuts on a per capita basis to contribute to reducing the national debt. In the north, the per capita cuts did not work. They were a useless exercise, so the federal Liberal government of the day reduced the gross expenditure base by five percentage points, which not only took significant money out of the Yukon's coffers, but it also threw into disarray the mechanisms in the formula which were intended to give the territories similar access to a standard of program and service delivery that all Canadians enjoy in provinces because of equalization. That's an important point here, when the member considers those percentages.

Then devolution came upon us, and the transfer of $240 million to $250 million from federal budgets to territorial budgets. These are important issues when it comes to financial management. They are factual, and they are contributing to the big picture.

Then we get into the situation where the federal government started to realize surpluses - and there are a number of reasons for that; the surpluses were building - they started to reinstitute the cuts to the provinces. They removed the ceiling on equalization. The north was not being treated fairly. Under the former Liberal government here in the territory, these were issues that they neglected to address.

I don't know why they didn't take this challenge up - they chose not to. They chose to do other things - like allow Dawson City to overextend its debt by some millions of dollars, contravening the Municipal Act.

They chose the Mayo-Dawson inter-tie and millions of overrun. They made those choices versus standing up to the federal government and addressing the unfairness of the transfer, the investment of the national wealth as it's intended to be invested - fairly across the country. This is not a handout; this is not other people's money; this is a core value of this country and this party, and this government will never, ever diminish or stand down from that core value. We deserve our fair share of the national wealth - and that's what this government has been doing - gaining our fair share and closing the adequacy gap left to us by Liberal governments, both federal and territorial.

That has allowed us many more options in stimulating the Yukon's economy, because no economy can run without cash flow - that is the fuel that drives the engine. In getting our fairer share of the national wealth, we've in turn invested that in increasing capital investment, increasing education, increasing health care delivery, increasing and strengthening the social safety net, building more infrastructure and creating a better situation in the Yukon. No one can argue this, Mr. Chair.

If you look at this question, is the Yukon better off today than it was November of 2002? Still the evidence speaks to one answer and one answer only - yes, it is.

Let's look at the flip side of the member's argument, and that is own-source revenues. Even with the increased stimulus and us gaining a fairer share of a core value - the fair distribution of the national wealth - our own-source revenues have grown every year under this government, from $80 million to $81 million to $84 million to $86 million. Own-source revenues are increasing in this territory.

I do not know where the member's percentages come from, but I can tell you this, Mr. Chair: we do have more money in today's Yukon - hundreds of millions. We are increasing our own-source revenues each and every year, and we're the better for it. We intend to further close the adequacy gap with Canada.

To get to the member's last point, we're very comfortable with the new federal government. They're the first federal government that has admitted there is a fiscal imbalance in this country and have every intention of dealing with it. Recent discussions with them and my fellow premiers clearly show the territories are on the right path.

That is the best way I can respond to the member's argument.

Mr. Hardy: I'm not sure if the minister was saying my figures are incorrect. I hope he's not saying that, because they are figures that have come from government sources. He doesn't know where they came from - maybe he needs to look closer at the finances.

The minister is correct on a lot of points there, and I don't disagree with him; however, there are many areas that need stimulation. There are many areas where people are struggling. It's a priority for how people want to direct the funds the territory has available to it. We've questioned this government about many projects over the years where we feel they have gone sideways. They don't have a great record for delivering projects on time and on budget. There's a lot of proof there. We could start naming them. If the minister wants to get into a debate about that, that's fine.

But there is a fact that our reliance on the federal government has increased. That is contrary to an election promise - that's all. I have to wonder if the minister knew what he was doing in that regard, because that reliance has increased. There is no question about it. So be it. If the minister wants to stand up and say that I am perfectly correct and they have increased reliance on the federal government transfers, fine, I will agree with him on that.

We questioned their spending and we will continue to. We have questioned a lot of things and we have a lot more questions to ask over the next 20 or 21 days we have left. We will get into it, especially when we get into line-by-line and departments.

What has been used a lot already in this Legislative Assembly this session is the Auditor General - evoking the Auditor General's name as meaning everything is perfect if the Auditor General says it is. The Auditor General looks at specific areas and gives a report based on that. The Auditor General praised the Public Accounts Committee to no end. The Auditor General felt one of the reasons the government was operating better was because the Public Accounts Committee was up and running. As I said in the past and I will say it again: the members of the Public Accounts Committee were from all parties. I believe with the help of the Clerk's office and the Auditor General's staff, we were able to do the public's work. We managed to do that in what I felt was a non-partisan manner. Because of that, for the first time in really 12 or 13 years, one committee was finally able to function. That's kind of a sad record.

Some Hon. Member: (Inaudible)

Mr. Hardy: Even on present and past governments - in that the other committees cannot seem to function.

We are elected to be in here, so when it comes to committee work, you would think that we could put aside those issues and do the work that the public wants us to do. As we are nearing the end of this term, it's not a great record, other than the public accounts, to be able to go back to the people with. The minister indicated that that record hasn't been good with past governments, and he's perfectly correct; that record hasn't been good. I am hoping that the future is going to be different for any new people who are elected in this Legislative Assembly - new governments - that they will recognize that committee work is essential for the operation of this Legislative Assembly and for good governance. It is essential.

There are a lot of areas in legislative reform that we have waited for - acts and bills, reviews - but none of it is getting done. There were promises of red-tape reduction. Again, that's a standard promise. Very little got done on that. There were many promises for projects - the Dawson bridge, all that stuff. For instance, we've spent millions and millions of dollars for repairs to a jail that needs to be replaced. Everybody knows it needs to be replaced, yet we're standing here today, three and a half years later, and $4 million plus is being put into a building that has to be torn down. There's no question about it; it has to be replaced. I don't think that has ever been a question. So it is sad, because that's $4 million gone that could quite easily have gone somewhere else.

I'm going to step back and let some of my colleagues go in a minute. But since the minister just met with the federal government, where are we at with the expert panel? Is the time frame still set in place, or has there been a delay with the expert panel in regard to the territorial formula financing and that formula? Has that been delayed? Are we looking at a delay in that because of the change of government or for other reasons? Is the federal government planning to continue that work, or is the federal government planning to approach it from a different perspective?

Hon. Mr. Fentie: I know the official opposition is going to find fault with everything the government does. The official opposition cannot find fault with a number of very important facts: evidence of where the territory is at today versus where it was a few short years ago.

We have a growing population; we have historic unemployment lows; we have dramatic increases in the private sector, not the least of which is going from $5 million in mining investment in 2002 to a projection of $100 million plus this year. That's growth in two and a half or three years - phenomenal growth.

The member gets fixated on this term “reliance on the federal government”. I'm glad the member believes that Yukoners accessing a standard of program and service delivery that every other Canadian enjoys is “reliance”. We represent it as a core value of this country, a value we will uphold - this government and this party.

Furthermore, Mr. Chair, if you look at how our investments are unfolding, they are all going to reduce dependence by creating self-sufficiency. That's why we're investing in infrastructure and education and those areas, because in the long term that will contribute to self-sufficiency in our fine territory.

With respect to the expert panels, there are two of them. There's the expert panel that was tasked by the Council of the Federation to review fiscal imbalance, and there's an expert panel that has been tasked by the federal government itself to review fiscal imbalance. The expert panel that was tasked by the Council of the Federation has tabled its report with the provinces and territories.

There was consensus reached with respect to the recommendations from the expert panel, and they are with respect to the territories. The territories are the recipients of recommendations where we get back to a formula-based arrangement with Canada that is in keeping with the Prime Minister's commitment of base-plus formula.

It includes that we should take on more control of our affairs in terms of what goes on here in the Yukon, and that when it comes to natural resources and non-renewable resources, we will be the principal beneficiaries. That is very good for us. It includes special circumstances that must be recognized in the need for infrastructure and so on. This is not reliance, Mr. Chair; this is a balanced, fair sharing of the national wealth, as it should be. It is up to jurisdictional governments to invest in areas that make sense - as we have. That is why we are experiencing growth in own-source revenues, growth in the private sector, growth in the population and historic unemployment lows.

We are very comfortable as a government with where the federal government is heading. They have made their commitments. They articulated them clearly during the campaign. Fiscal imbalance is not a buzz word that we use here in this House. It is national in nature - across this country the argument of fiscal imbalance has been made time and time again before a Liberal government only to fall on deaf ears. It took a Conservative government to step up, recognize and admit fiscal imbalance existed and commit to addressing it. That is happening.

The member points out that the Public Accounts Committee is now getting its just accolades from the Auditor General - as it should. I want to point out that the member also stipulated that over the past 12 years it wasn't functioning. How is it then that under this government's watch - with the members this government appointed to the Public Accounts Committee - is it functioning to the point where accolades from the Auditor General's Office have been forthcoming?

I would suggest that it is not solely the government's doing; it is the collectivity of the members of the committee who are making it so. I think that's a good sign. The government will, of course, accept its share of the responsibility for that positive improvement with the Public Accounts Committee.

I find it important because it gives a government more insight into areas that we should be working on and it allows an all-party forum to do exactly that. We will continue to ensure that the Public Accounts Committee functions to a level that is contributing positively to our territory overall.

The member mentioned “record”. I just want to say to the member that he can present this argument however the member wishes to do so. This government is very confident in going before the Yukon public with its record and, on top of that, its vision, its plan for the future of this territory, unlike the members opposite who are switching chairs and trying to find a place to firm up their footing and get a little more focused on the realities of today's Yukon.

Overall, the finances and the territory are in good shape. The population is growing. Our economy is turning around and improving and there are many indicators that show the Yukon is coming of age. We are very, very pleased to be a part of that.

Mr. Hardy: Well, I've always believed that the Yukon was of age and doing quite well. I've lived here for 40-some years, and it's a great place to live. But a lot of people have contributed to bringing the Yukon to where it is today, and that is wonderful. I'm going to allow other members to join in the debate, and then I'll come back in later and engage again on many issues. It is, I suspect, the last budget that we're going to see from the Yukon Party government for a long, long time. We'll have to wait and see how the public responds to the message of the Yukon Party and their history and the other members that are not exactly sure where they belong and what happens when they go back to the polls. So with that, we will re-engage fairly soon.

I'll let the leader of the third party - I know he has many questions. I look forward to the ongoing debate.

Mr. Mitchell:  I'd like to thank the Finance minister for the interesting civics and history lessons that he was providing to the leader of the official opposition. It was certainly very instructive. Lately I've noticed a common theme between the minister's answers and the questions from the Member for Whitehorse Centre. It reminds me of a song from the satirical animated film South Park entitled “Blame Canada”. The new song here seems to be “Blame the Liberals”. Well, we'll take the attention as the compliment that I'm sure it's intended to be, all in good spirit.

While we're sharing history, however, I would remind the minister - and while he's talking about seating arrangements - that his seating arrangements have changed in the past as well. I do recall that while we're looking at history lessons regarding the municipality of Dawson , I believe it was while he was sitting as a backbencher in the former NDP government that the territorial government first advanced funds to the municipality of Dawson, which led them down the path that they have now found themselves on.

So all of that is interesting. The minister has frequently been excitedly talking about - I'm not sure if the word “bragging” is one we can use - the stimulative effect of the record budgets. We have heard quite a bit about this high level of capital spending forecast at over $191 million. It was interesting to see the news story last week. I know the minister and the Member for Whitehorse Centre have exchanged some debate on this topic. Nevertheless, the minister has indicated there was perhaps a mistake in the headline but that the content of the story was accurate and he said the reporter had done a good job, so that does bring us back to the issue of the comments by the minister's own officials about the apportionment of items included under capital versus in other jurisdictions, where they might be more traditionally seen as items for the O&M budget.

The minister has made some comments that this has been ongoing for some period of time, and not only under his watch, but he has also indicated that he has righted the ship and fixed many things and that the Auditor General is extremely pleased with the reporting process. I wonder if the minister might want to comment additionally on why he hasn't taken any steps to change that apportionment, if it could more accurately be reflected in a different manner, considering he has indicated that this has occurred under successive governments. Today we're here to discuss the budget and, of course, in doing so, the record of his government.

Again, I'll let the minister answer that and then we'll carry on with more questions.

Hon. Mr. Fentie: On the issue of blaming the Liberals, I can only say that if the shoe fits, wear it. Decisions were made by past governments that brought us to where we were in 2002. The Yukon was not in very good shape in 2002 and we all know it - you can't change those facts.

We have continued to book expenditures or investments in the budget in light of the fact that there are positives with respect to how we budget and book set expenditures. For example, if the member's argument is based on a newspaper article - although I would hope that the member has a lot more depth of knowledge in finance and fiscal management beyond articles or stories - the member then would probably recognize that to clearly define allotments for O&M and tangible capital assets would not be that positive of a thing for the Yukon public. Why would we bury capital investments in large chunks of O&M when under the system we present to the public there is clearly more transparency in showing line-by-line expenditures on the capital side so Yukoners can see with a greater degree of assurance where their money is going instead of lump-sum O&M values? So there is an upside to this.

But, as a government, I can tell the member now - the leader of the third party can stand here for days and days and days on end - that this Minister of Finance and this government are not going to change how we are doing things. We believe that, beyond tangible capital assets, there are indeed capital investments, and we will continue to do that in accordance with all public sector accounting guidelines, direction of the Auditor General and ensuring - because we do get good advice - that we are booking appropriately the expenditures and the liabilities of government, which was not the case in the past.

It is no small feat to achieve in this territory unqualified audits. The past governments were getting qualified audits because they not only were not booking all the liabilities, they were artificially setting levels in place in the budget, which is clearly not demonstrating full transparency to the taxpayer, but they did so at the risk of receiving qualified audits. We changed that for good reason. It is about accountability and being transparent and responsible to the public you serve. That's what the budget reflects and what this government and this Minister of Finance and all the ministers responsible for Management Board and Cabinet will continue to reflect.

Mr. Mitchell:  I thank the minister for his responses. If he needs any reassurance, no, we are not getting our information from newspaper stories. Rather, we thought, since it actually quoted one of his own officials, it would be a good example of the questions being asked not just by the members on this side of the House but even by the officials in the department. We thought it was instrumental for that.

The minister has moved to full accrual accounting and the Auditor General has asked that all jurisdictions do that. I think that's a good thing. So, some of what the minister likes to refer to as the endorsement is rather that we have moved in that direction, and that is good if it shows more accurately the true financial picture of the territory. However, again, the minister's financial estimates estimate the projected surplus for the 2006-07 fiscal year to be some $8.98 million.

 However, that number doesn't include whatever the funds are to alleviate Dawson 's debt, the $1.25 million for the Yukon College pension shortfall, funds for the Hospital Corporation pension shortfall, or perhaps other commitments the government has made off the books, so to speak, in terms of waterfront development and others.

With respect to the Auditor General's comments referring to approving the full transparency of the Government of Yukon's reporting, I can't imagine the Auditor General would want to endorse not including known liabilities in the main estimates. We have seen the minister announce, within minutes of completing his budget speech, that there would be an election held in Dawson and therefore the funds would be brought forward. Surely the minister must have had some estimates of what that would be.

The minister pointed out earlier, during Question Period, that there will be supplementaries tabled to address these issues. I'm wondering if the minister, having met with his officials, can provide us with an updated estimate, based on some of these other items, for the projected surplus at the end of the 2006-07 year. Does the minister have any new information for us that he might share?

Hon. Mr. Fentie: First off, it is not the Auditor General who directs that we go to full accrual accounting; it's the direction of the Public Sector Accounting Board, not the Auditor General. The Auditor General supports this move because it's high time all governments went from a cheque-stub type of financial management to full accrual accounting.

Furthermore, I think the member is somewhat confused about how budgeting works. This government is not going to guess what to book. It's going to book as much as we possibly can - actuals - although budgets are always projections that will have any number of variances during the course of a fiscal year. That's just the nature of the beast.

The member now makes the point of Dawson City. We don't know the exact amount - or did not know at the time of the budget going to print - of what that would be for Dawson City. In fact, people are still working on that today. Once done, we will then proceed accordingly.

We also have more variances coming to close out the fiscal year of 2005-06; that happens every year-end. We've built flexibility into the fiscal framework. This is not something we're even concerned about, as the member opposite appears to be.

We know clearly where we're heading financially. We intend to keep this direction going. We intend to continue to improve the finances of the territory, and we intend clearly to deal with Dawson's issue and many others.

Mr. Mitchell:  I would remind the minister that it is he who keeps referring to the endorsement of the Auditor General, so that's why I thought it would be appropriate to comment on it. There are other amounts that are unknown. We had a briefing by officials from the Public Service Commission this morning, and in answering the question on why there was a 26-percent increase in one line item, part of the answer included the fact that there were unknown amounts of future liabilities having to do with superannuation. Yet there is still an attempt made to fund or to provide for that liability, even though the full amount is not an absolute. So it is done elsewhere in the budget, where there are amounts that are increased when the thought is that they might be an increase down the line, even though the exact amount can't be determined. Again, they are main estimates, and we recognize that they are only estimates.

The minister included $2 million under Executive Council Office for the substance abuse action plan, and I want to thank the minister for putting money in the budget for it, because it is an important item. It is under Executive Council Office, and I understand that it's possible that the money will be portioned out and spent directly from Executive Council Office. It's also possible, I understand, that the money will be book transferred to the appropriate departments when particular programs are funded. I'm wondering if the minister has made any decisions as to which method will be used. If so, presumably, again, it's in the interest of transparency. I would just want to hear the minister's comments on that.

Hon. Mr. Fentie: It's always important when dealing with the leader of the third party that we make every effort to keep the member on track and focus in on things. The Auditor General has been giving this government unqualified audits. That has nothing to do with going to full accrual accounting. That is the point I want to make to keep the member on track. It's the Public Sector Accounting Board that dictated that particular change. 

The issue for the Auditor General has been the improvement in the finances of the territory - fully booking our liabilities, getting the Public Accounts Committee up and running after a dozen years, as the Member for Whitehorse Centre stated moments ago, and ensuring that we are transparent and presenting a budget that meets all requirements. That is why it is unqualified.

With respect to budgets themselves, I hope the member understands that budgets are a set of goalposts with projections. There will be variances continually throughout a fiscal year. We deal with them all the time. This government has shown an ability - given its people at the table - to manage those variances and keep our finances healthy, unlike recent governments that wound up unable to manage those variances, and putting us in a cash-poor position, where we were in an overdraft situation. That is not the case today. We have millions of dollars. At the end of a fiscal year, after managing all those variances, we have approximately $100 million in this bank. That's what we are talking about when it comes to fiscal management or cash management.

With respect to the $2-million investment in substance abuse action, the reason that fund was set up in the Executive Council Office for now is because this is cross-departmental. It's much simpler to manage the fund if we have departments responsible in areas of education and prevention, harm reduction, treatment and enforcement, coming forward with proposals to the Executive Council Office for determination to be made, through the appropriate processes, of assessment and so on, so a submission would inevitably come forward to Management Board for the final decision on an expenditure.

For now, we find that's going to be the most workable approach, as these proposals start to come in from the Department of Health and Social Services, Department of Justice and the Department of Education. The Women's Directorate may bring something forward; it all depends on the proposal and the submission therein.

That is why it was set up in the Executive Council Office - to better manage and expedite delivery on real substance abuse action here in the territory. Some steps are already in the works. We're debating the safer communities legislation in this sitting, for example.

Overall, I think the member clearly understands why that fund was set up the way it was, and we can move on.

Mr. Mitchell:  Regarding history lessons, I also think it would be interesting, since the minister frequently likes to refer to my predecessor, that I might mention one of the first acts of this government was to repeal the Taxpayer Protection Act that was passed by his predecessor as government leader of a Yukon Party government, and he was soundly criticized by his predecessor for doing so. I'm not sure if that was in the interests of transparency or what the reasoning was for that.

I was paying attention to some of the exciting repartee between the leader of the official opposition and the Premier, the Finance minister, regarding percentages having to do with territorial revenue and transfers from Canada. I'm wondering if the minister has any comments as to why, when we extend to 2008-09 and 2009-10, between those years the minister is estimating the increase in territorial revenue to be almost flatlined but sees a healthy $20-million increase in transfers from Canada. Is that just because it is too far out for the minister to project what will be happening locally in Yukon or is there a particular reason for that?

Hon. Mr. Fentie: Again, keeping the member on track - and this is important for the House - we did not repeal the Taxpayer Protection Act. We simply amended a clause in the act so that we could implement full accrual accounting and present to the Yukon public one budget in all its detail -again, for the member opposite's benefit.

The member makes a point on the fiscal framework. Let me explain to the member opposite that one of the reasons why there is a flat line is to do with the mineral exploration tax credit and the best available information on where we are.

Furthermore, the increases in transfers from Canada are on the best information we have. That is predicated on a 3.5-percent escalator. That's why the fiscal framework shows the numbers as they are shown in the budget summary document.

However, I would point out again to the member that we will continue to experience variances. Already mining exploration numbers are being projected higher than they were a few months ago - that's an example. There are a number of private sector initiatives that appear to be moving ahead positively. Overall, Mr. Chair, we have to reflect on some of the leveraging that is going on given the film incentive fund and those aspects where, I believe, we are getting a 10:1 ratio - the film incentive fund invests a dollar and we get $10 in return from private sector investment.

These are all relevant to those variances I speak of. They will happen during the course of any particular fiscal year, and that's why we do year-ends and that's why the Auditor General reviews the books in their entirety and gives us either an unqualified or qualified audit.

Mr. Mitchell:  I would also point out to the minister that, in responses to questions asked, he has mentioned he believes the opposition parties - and I can only speak for one, and that's the third party, the Liberal Party - are opposed to receiving our fair share of transfers from Canada. I don't believe we've ever said that. What we were critical of was an economic plan that was based on spending other people's money but didn't necessarily show the investments into the future. I don't think we've ever said we shouldn't get our fair share.

I would also point out to the Finance minister that it was he who said we first got our fair share from the last federal government, the federal Liberal government. We actually have yet to see what we will get, going down the road in the future years, from the new federal government, but I hope they will continue to recognize the principle that, when you have a territory with some 30,000 people, per capita funding is not the appropriate way to look at things and we need to be treated differently, due to our small numbers, as will our sister territories.

I can certainly agree with the minister on that.

Speaking of additional funding, the future of the northern economic development fund - some $27 million being administered by the feds - the Yukon government has reached some agreements with First Nations on how to approach Ottawa pertaining to the budget. Can the minister elaborate on what's in that agreement? Will the minister be tabling any agreements he may have formed, if they're in writing, or giving more details on it otherwise, with First Nations? What are the government's priorities, together with First Nations, for this money?

Hon. Mr. Fentie: Mr. Chair, the member opposite can't have it both ways. On the one hand, the leader of the third party has made the case that all we're doing in this territory is spending other people's money. On the other hand, the member says that should be our fair share. Then the member points out that it was under a former Liberal government that we started to receive that share. Yes, and I would point out it took the three territories to stand up and walk out on a prime minister - the first time that that has ever happened in the country, since the days of René Lévesque. That's how we got the federal government to take notice.

From there, they accepted the business case that we were collectively putting together with our sister territories, and we've progressed a great deal from that point to where we have a federal government today that admits fiscal imbalance, which we were trying to point out all along - under then former Prime Minister Jean Chrétien to where we're at now in this country. So there has been progress made.

But I think the member again has to stay on track. These are factual events that took place that changed the fiscal course of this territory. It was not done by an MP sitting in the halls of Parliament Hill. It was done on national media when the three territorial premiers walked away from the table. It was from that point on that our fiscal relationship with Ottawa improved and continues to improve today.

With respect to the northern economic development fund, it was clear that the federal government, in placing this fund in the hands of the Department of Indian Affairs and Northern Development, was moving toward unilateral decision making. That was not acceptable by First Nation governments in the Yukon, nor was it acceptable by the Yukon government - our government. So we have worked with First Nations to resolve the issues and have made a proposal to Canada on a trilateral approach for investment that meets all the principles that Canada - not us, not First Nations, but Canada - required for the northern economic development fund.

Once there is concurrence from Canada, we will, in accordance with our relationship and partnership with First Nations, make all necessary information public.

Mr. Mitchell:  It is certainly a nice story and great folklore about the three premiers walking out, but I would point out that although the three premiers walked out on the Prime Minister's conference, I suspect an awful lot of the hard work was done by successive Yukon premiers of all political stripes, not any one event, and also by the hard work over many years by the officials who provided very strong evidence to make the case.

So, it's great to just say, “I got up and walked out, and that's how it happened,” but the groundwork was laid by a series of governments and premiers and the continuous work was done in the trenches by the officials.

I am wondering if the minister could give us any more information - just looking at things that were promised at the beginning of the mandate. The minister likes to talk about all the things that have been promised and accomplished. When will the new Whitehorse Correctional Centre be built and completed? Can the minister give us any information on that? Three and a half or four more years and several million dollars have gone into planning it, but the existing structure is still unsafe and still continues to limit the ability for good rehabilitative programs to be provided, due to its age and its size.

Hon. Mr. Fentie: Once again, I am trying to bring the member back on track. The member makes the point that all the groundwork for our fiscal turnaround was laid by previous governments. No, I'm sorry, Mr. Chair, but I cannot agree. That is not the fact. The business case was not tabled until 2003, which clearly demonstrated the unfairness of what was happening here in the Yukon and in the north. Furthermore, Mr. Chair, no matter what groundwork might have been laid, if the doors are not opened, there is no reasonable response coming forth for that groundwork.

It is a significant issue, an event where, finally, instead of fighting with our sister territories, as the former Liberal government here in the territory did, we joined together and, as a collective, made a stand and got those federal doors open and, from that point on, progress has been made.

With respect to the Whitehorse Correctional Centre, past planning only contributed to what was obviously a huge problem, and that is the recidivism rate, by creating another warehouse. That's not what this government is going to do. In this budget we have investment for correctional infrastructure, and we will proceed with the planning accordingly, but we're not going to build another warehouse.

Mr. Mitchell:  I don't think the minister actually answered the question. I wasn't debating with the minister what the curriculum would be in the new facility or even what the exact design parameters would be. I asked a very simple question: what would the date be? Will it be 2008? 2009? We didn't get that answer from the minister, because the minister wanted to just make political statements.

Perhaps the minister will check his notes and come back with an answer later.

Does the minister have any comments he can make about the three outstanding land claims? What has the government done over the last three years? Before the minister stands up and says, “I want to again correct the member,” I recognize there is currently no federal mandate. Again, in his discussions with the DIAND minister and with the Prime Minister, the Yukon certainly has a role to play. The process hasn't moved forward over the last three and a half years, even before the mandate expired. Can the minister give us any updates? Now that there's such a Yukon-friendly Conservative government in office, what progress can we anticipate?

Hon. Mr. Fentie: It's pretty hard to define this particular question as general debate on a budget; however, I will accommodate the member opposite.

Again, we have to look back at recent history. The cancellation of the mandate to negotiate land claims in the Yukon transpired in 2000-01.

What was left was a set of memoranda of understanding on which, when this government took office, extensive negotiation of detail and issues had to be concluded. We were successful in doing that and finalizing claims such as Kwanlin Dun First Nation, Carcross-Tagish, and of course the signing off of Kluane First Nation's final agreement and self-government agreements. But we pressed the federal government then - as we do now - that there is unfinished business in the Yukon , which includes the Kaska Nation and the White River First Nation. I'll be meeting with Minister Prentice this week to again press Minister Prentice on the need to quickly move toward concluding the unfinished business in the Yukon.

Mr. Mitchell:  We certainly look forward to hearing the minister report back on those discussions. As far as general debate, I think almost anything that exists as line items in the budget should be open to debate. Certainly, we've heard all kinds of interesting history lessons from the minister - to my colleague, the Member for Whitehorse Centre, as well as to me - which don't necessarily have any inclusion in general debate, but we certainly hear some past history.

I'm wondering about the status of partners. The minister talks about pan-northern partnerships and others. Regarding the railroad studies, I'm wondering, since there is significant money in the budget, whether the minister has asked either Alberta or B.C. to contribute to the railroad study since obviously any railroad would terminate and connect up in those other jurisdictions. So I'm wondering if there is any possibility of contributions to the studies coming from either of those jurisdictions?

Hon. Mr. Fentie: The issue of the railway feasibility study is a choice the government made in partnership with Alaska. A huge portion of the cost to date has been borne by Alaska . Our commitment is to ensure the feasibility study is concluded and our share of the expenditures therein. We expect by June or early summer that the feasibility study will be concluded. To date, the contribution of the provinces of B.C. and Alberta is full support of the railway feasibility study. That is on the national stage; it is part of the national infrastructure strategy, which includes roads, rail, ports and airports.

Mr. Mitchell:  I would think that full support would be full partnership. The partnership appears to be with Alaska. There is certainly support there economically, so it seems like somewhat less than full support from Alberta and B.C. - moral support, perhaps.

Similarly, has the minister made any requests to Alaska for funding for the port study, since we are obviously studying, first and foremost, at least one Alaskan port, as well as ports in B.C? Has there been any request to Alaska or B.C. for funding assistance on that, since any decisions made as a result of the study would be mutually beneficial, one would presume?

Hon. Mr. Fentie: This is an interesting one, considering the Yukon did have access to tidewater that was cancelled, discarded, thrown away, by the former Yukon Liberal government - big mistake. What we've managed to do is get a guarantee from Alaska for access to tidewater, and we have partnered with them in conjunction with the railway feasibility study to include a port access study.

Frankly, we are working quite well with Alaska. We are paying our way; they are paying their way. I want to point out to the member opposite that he should include in his comments the millions upon millions of dollars that the Americans, with the support of Alaska, have invested in the Alaska Highway, the Skagway Road - to an important port - and the Haines Road. These are significant funds that have been invested in the Yukon , putting Yukoners to work and creating and building infrastructure in the Yukon Territory for the long-term benefit of our citizens and our territory.

Mr. Deputy Chair, the other point that the member makes regards the provinces. I want to ask the member opposite where the member stands with our MP's commitment in the 2004 federal election to support the railway feasibility study. Where is that federal commitment? We've provided them a seat at the table, but to date our MP has not come forward with the goods, so we're covering the bases, along with Alaska .

Mr. Mitchell:  Any time that the minister would like to come back and sit on the opposition side, then he can ask the questions. Right now, I get to ask them, and he gets to answer them. I know how much he enjoys that. I can tell by the smile that he normally has on his face during these sessions. We'll just have to keep it that way.

The reports on the two topics we have just discussed - I know that there are supposed to be additional sections of the rail study completed this summer. I'm not certain what the full target date is for the port study. Will the minister commit to making these reports available before the next election? Will he be tabling these reports before then, or are these more things that will be finalized after the election?

Hon. Mr. Fentie: Again, I must get the member back on track. I did state here moments ago that we expect the feasibility study for the Alaska rail link to be completed by June or early summer, and once we've concluded our work with our partner, who shares ownership in the product, of course the Yukon will make public the information pertinent to the possibility of a rail link going through Yukon to the State of Alaska.

Mr. Mitchell:  Can the minister comment on behalf of his colleague, the Minister of Economic Development, on any contracts that have been signed as a result of the frequent trips the minister has made to China?

Hon. Mr. Fentie: That's a question the member can save - keep it in his quiver, so to speak - and when the Minister of Economic Development is up for debate, he can launch away. I will say that I would hope the third party, with its newest member, has recognized on the globe where the biggest growing marketplace is and what is driving the global cycle to a great degree, and that is China . It's with good reason that the Minister of Economic Development is pursuing and fostering solid relationships in China to solicit investment and interest - interest in the Yukon and all that it has to offer. Some of the biggest demand in that marketplace is the need for natural resources. I think we can all agree that the Yukon has an abundance of those and we are becoming more and more the beneficiary of that growing demand out there in the global marketplace.

All in all, the Minister of Economic Development has diligently been fostering these relationships and is even on the Pacific Northwest Economic Region radar screen, taking a very important role in leadership of a number of western states - Alaska , Yukon, British Columbia and Alberta - in their efforts to garner benefit and gain from what's happening, especially in the Pacific Rim.

Mr. Mitchell:  The minister likes to say you can't have it both ways, and yet, on the one hand, the minister will stand up and answer questions by saying that under this government's watch, look at the increase in mining activity, look at the increase in exploration, look at the increase in all this activity, and then the minister provides us with lectures on China being the main driver of all this increased activity, with the huge demand coming from China. I think we can both agree on that point - that, in fact, the huge demand from China and the Pacific Rim has had the tremendous effect of providing record mineral prices, spurring activity all over North America.

I am wondering if the minister could give us any additional information on the status of the multi-level care facility for Dawson, which was another campaign commitment of this government. Perhaps the minister could explain what went wrong there, because I think that all the design work - this isn't one that I think the minister can blame on a former Liberal or NDP government, but rather the change seems to have been within this government. Perhaps the minister can tell us when we can expect to see progress made there.

Hon. Mr. Fentie: The member again has brought up an issue that I think has to be expanded on. This government has never said we are solely responsible for the turnaround in the territory and the interest especially in Yukon resources.

What we do say, though, is that we have provided the necessary governance to be able to benefit from what is happening globally.

The member opposite should know, if he doesn't already, that while all this growth globally was taking shape all around us, Yukon was left out and ignored. There were many reasons for that - much to do with the flawed and faulty policies of past governments.

And where would we be with things like the mineral exploration tax credit if we had not made the stand and increased the fiscal position of the Yukon Territory ? That's one incentive that may have fallen by the wayside. So it's not a question of having it both ways. It's a question of having it the right way, the Yukon Party way, the Yukon Party government way. It's working. All the evidence is around us.

Mr. Chair, with the multi-level care in Dawson, we are working on a number of priorities for Dawson, but the most important one, of course, is getting Dawson back on sound financial footing.

Mr. Mitchell:  I'm wondering what the government's position is on the daycare agreements that the previous federal government was signing with the provinces? I believe we didn't actually have an agreement yet, but there was money being held in trust. I think it was some $4 million or $5 million over five years, but the minister can correct me with advice from the officials if that's not the correct amount. But I think the intent was to try to sign a five-year agreement. Has the Government of Yukon been lobbying to have these daycare deals reinstated, or what is the plan on that?

Hon. Mr. Fentie: Well, I could liken this to standing on a board and getting a hernia trying to lift it. There is no further daycare deal with the new federal government. They have announced publicly, nationally, that it is cancelled. Our allotment, which we did not agree to because it was a per capita share, is still held in trust. However, the Yukon has long since taken the position that we must improve this area, and we have. The member can bring this up with the minister, but I think it's fair to say we've increased a number of percentage points the investment in early learning and childcare to the credit of not only the former minister but the new minister. We are paying a great deal of priority and attention to this particular area in the Yukon, and we will work with our stakeholders to address where we go with the limited funds held in trust on behalf of the Yukon by the federal government.

Mr. Mitchell:  Is there funding in the budget at all for the proposed new arts and heritage village on the waterfront we've heard so much about? I'm not certain what commitments may have been made, but is there any information on that?

Hon. Mr. Fentie: Again, this is an area that can be taken up with the minister responsible, but I will go way out on a limb and say there is no capital investment for a structure of any sort at this time, but I do believe the minister is proceeding with a public process. To keep the project alive as part of the waterfront theme or development, the budget has booked a $1 value, which gives this credence as far as a possible project.

Mr. Mitchell:  There were some questions asked previously, during Question Period, regarding the athletes village, which has somehow expanded to some $31 million. Does the acting Finance minister have any comments regarding how this has expanded to that amount and does he think this is good value for the type of units brought in and should there be something else he would want to get the Auditor General's imprimatur on?

Hon. Mr. Cathers:  I would point out to the leader of the Liberal Party - as has been pointed out by previous ministers on our side - that he needs to get his facts straight with regard to the athletes village project. The original budget that provided $2.9 million budgeted by the host society was not a realistic budget. It was a budget for rentals. Once they got into the details of proceeding with the project, they determined that they did not have the ability to either build buildings or set up the rental units with their own resources. They then came to the Yukon government and asked us to step in and assist them. We did step in. We are assisting them, and the member would find a far more accurate picture of reality if he reviewed what the original cost estimates were for the Yukon government's involvement in the project and realize that we are not overbudget.

The athletes village project has become two things: long-term educational investment in Yukon College to provide residences and an affordable housing component. The project is not overbudget. The fact that an original budget was done by the host society, which they determined was completely incapable of beginning to address the issue, has nothing to do with the end product that we are dealing with now. Our project - the Yukon government's involvement with the project and our project completion - is on budget. The member should review that and not bring inaccuracies to the floor of the House.

Mr. Mitchell:  Regarding the pension shortfall, the minister has committed there will be a supplementary budget this year for the amount of $1.25 million, I believe. Presumably, then, there will be adjustments made for the future liability that is being booked forward, in terms of booking all these liabilities for the next four years - I believe it was a five-year commitment.

Hon. Mr. Fentie: Once again, let me bring the member back on track. I as minister stated on the floor of the Legislature that there are fall supplementaries - there always are and probably always will be. This begs the question: are the members looking at the calendar because an election is looming?

As far as the issue of the college pension fund, this is not our liability. We committed to assist the college to ensure that its employees pension fund was not compromised in any way. That is exactly what we've done. Again, there will be many variances through the course of the fiscal year. It's a test to any government on how you manage those variances within your fiscal framework, ensuring you maintain a sound financial position, cash in the bank, and so forth. We have demonstrated that each and every fiscal year that we've been in office, and there is no reason why we would change. We will continue to do that.

As far as the college, we are extremely pleased that we were able to work in such a cooperative way with the board and others at the officials level in the college to quickly come to this arrangement, once we had the most updated actuarials, and be able to create the plan necessary to ensure the Yukon College employees pension fund was not compromised.

Chair: Are there any further questions for general debate? Hearing none, we'll go into line-by-line examination. The Chair seeks some direction as to which department we're going to go into first - into Finance. We will continue with Vote 12, Department of Finance. For the members' assistance, this is referenced on page 10-2.

Department of Finance

Hon. Mr. Fentie: Mr. Chair, while we are pulling out the necessary detail with respect to the Department of Finance in general debate before moving into line-by-line, let me begin by saying that, over the course of this mandate, as Minister of Finance I've had a great luxury in working with the officials of this department. We have what I would call a very talented team of people, very conscious of ensuring that the finances of the territory are maintained in an appropriate manner. I have worked closely with others, including our respective officials in both the N.W.T. and Nunavut, on a pan-northern approach.

But all in all, the critical issue for us in the Department of Finance is to maintain and ensure that the territory's finances reflect, as they should, that core value and principle of a standard access to programs and service delivery, investment in infrastructure and in strategic economic investment that all other Canadians in other jurisdictions have access to.

With that, I'd like to take the opportunity to provide the Committee with a few introductory remarks on the Department of Finance 2006-07 budget. The 2006-07 estimates for the department total $5.6 million. This consists of $5.3 million for operation and maintenance and $297,000 for gross capital expenditures, which translate into a $47,000 net funding requirement for capital.

The O&M budget is spread among four program areas as follows: the largest program and the one to which all departmental FTEs are assigned is the treasury program at $4.8 million; salary costs account for approximately 88 percent, or $4.2 million, of the treasury budget; banking services, supplies, telephone, travel, contracts, et cetera, at $376,000 account for 7.6 percent of the program budget. The public utilities income tax transfer, known in short as PUITT, accounts for the remaining program budget of $212,000, or 4.4 percent.

The Workers' Compensation Health and Safety Board supplementary benefits program of $426,000 is legislated under an act of similar name. It provides supplements to benefits paid to workers who are injured, by private insurers prior to the Yukon Workers' Compensation Health and Safety Board coming into existence. These supplements bring the benefits these workers receive up to the sums that would have been paid had they been covered by the territorial board.

The allowance for bad debts program, $48,000, covers the annual provision that is expected to be required of uncollectible accounts receivables for taxes, third party services, student loans, et cetera. The actual amount that is charged to this account each year is the result of a formula calculation that takes into account, among other things, the age of our accounts receivable.

The prior period adjustments program is carried at $1 to provide line item vote authority to make such adjustments. This item is to cover corrections of previous year's accounting errors, should any be discovered. The capital budget for the Department of Finance is comprised of the following: workstations, nil; printers, $8,000; office furniture, $29,000; loan guarantee contingency, $250,000; for a total of $298,000.

The loan guarantee contingency is voted every year to allow the Department of Finance to reimburse a financial institution in the event they should call a guarantee under the venture loans program. If there is no such guarantee called, there is no expenditure and the vote is allowed to lapse. Hypothetically, if a guarantee is called, our payment to the financial institute would trigger a recovery from the borrower. This accounts for the loan guarantee contingency recovery that also shows in our main estimates.

The department budgets two small recovery items. They are $6,000 for the supply of payroll services to Yukon Workers' Compensation Health and Safety Board, and $10,000 paid by Diners/EnRoute for using their central billing system for charging airfares for employee travel. This amount is based on a percentage, once a threshold of $3 million worth of billings has been reached.

These are the highlights of the Department of Finance budget. I welcome any questions in regard to the department and the very significant role it plays in the corporate structure of Yukon's government.

Mr. McRobb: I'd like to follow up on a couple of items the Premier is aware of. Last week I put them in the form of motions that were tabled in this Assembly.

The first item is: where are the community breakdowns of this budget? These breakdowns are imperative for us to know - especially the rural MLAs with communities out there - in order to understand what is in this budget for each community. This Premier knows that, in previous budgets, this material has been provided, and previous governments even provided this material during the budget lock-ups. Here we are, almost three weeks past the budget lock-up, and still we have no community breakdown from this government. Once again it is being secretive with the information that should have been provided by now.

The second request is very similar. It deals with the list of requests made by each community during the budget process, including the Premier's tour. This request was made, and we believe it is a good tool to have in order to compare what's in the budget in the context with what was requested. As opposition parties, we feel it is necessary to have that information in order to review this budget and - I'll speak for myself - it is something I feel I must have before coming to a vote on this budget.

Would the Premier accommodate both those requests, and will he do so today?

Hon. Mr. Fentie: Some things never change, although seats may. Let me start with the community breakdown for the member opposite's benefit. Beaver Creek, in the 2006-07 capital budget, will receive $362,000. These are gross amounts. Burwash Landing will receive $435,000 in capital; Carcross will receive $1.773 million in capital; Carmacks - the tiny community of Carmacks - $11,690,000; Dawson City, $7,127,000; Haines Junction, another community in the member's riding, $463,000, and we're also working in Haines Junction with the seniors and the community on assisted living. It's not in the budget, but we are working with the seniors, as we committed to do, planning a facility for the seniors in Haines Junction and the north highway.

Marsh Lake will receive $1.4 million in gross amounts; Mayo, $3.8 million; Old Crow, $894,000 of capital; Pelly Crossing, $228,000; Ross River, $539,000; Swift River, $153,000 of capital; Tagish, $2.7 million of capital; Teslin, $406,000; Watson Lake, $4.3 million; Whitehorse, $45,799,000; for a total territory-wide gross capital  amount of $109,605,000.

As the Member for Kluane can now see, given my presentation here, there's a good spread and balance of capital investment across the territory, albeit Whitehorse , with such a large majority of the population and infrastructure, receives the lion's share. Collectively throughout the rest of rural Yukon, we are making investments in capital where there are demonstrated needs. These investments are leading to community well-being and other important facets of improving Yukon communities overall.

I am very pleased to present this breakdown to the Member for Kluane, in gross amounts. If the member wants, I can stand up again subsequent to another question and relay the recovery amounts and the net amounts.

Mr. McRobb: I would like to point out to the Member for Watson Lake that his answer was highly deficient, but then, again, he knows that. He only responded to one of the two questions, and the response he gave was highly inadequate.

We are requesting the documents, entitled “Community Breakdowns”, so we can see what comprises the community totals. The Premier knows that. He is unwilling to comply with our request. He has already had a delay of nearly three weeks since the budget lock-up. We know how secretive this government is, and it continues to be secretive - probably right until the day Yukoners go to the polls it will remain secretive.

This information is important to us, especially those MLAs from rural Yukon . It is standard information that has been provided. I recall when the Member for Watson Lake was on this side of the House he would stand up and harangue any previous government that may not have handed over the budget breakdowns as immediately as they should have. Now that he has his hands on the levers of power and the floodgates of information, the river of information has come to a grand stop. It is dammed, Mr. Chair. The Premier should let some information flow, at least given the proximity to election day. You would think he would be looking for some positive media stories about maybe how his government has opened up the whole veil of secrecy that has been cloaked over it for three and a half years.

Yet, here we are begging for community breakdown information three weeks after the budget lock-up. What kind of a deal is this?

Obviously, the Premier forgets how things were in opposition and how we do rely on some trust in government for acquiring the right information. Obviously, we got our hands burned again. We should have learned not to trust this government when it comes to providing information that we need. Instead, it seems we have fallen back into the rut where we have to stand up and harangue this government, especially the Premier, the Member for Watson Lake, about these items. I had hoped that, after three and a half years, we could move the debate beyond this stage, because it's getting quite trivial for me to stand up and ask about the same stuff I was asking for three years ago. Yet you heard the answer we got. The Premier knows what we're requesting. He stood up and tried to gloss it over. He won't provide the material. He gave us only the totals. We need to see the projects identified that make up those totals, and we want to see it in writing - him reading something into the record simply isn't good enough. We want the documents that are referred to as “Community Breakdowns.”

Now, the other item was the list of requests made by the communities during the budgeting process. He conveniently ignored responding to that request. I think he has heard me loud and clear this time. It's time for accountability, and we're expecting it from this government and so are Yukoners. Instead we see the games continue - the game of hide and seek, the old shell game continues.

Well, politics aside, I'm looking for an opportunity to stand up and be benevolent and give credit where credit is due. Even if we're on the doorstep of an election, I'll give credit where credit is due. But the Premier is depriving me of an opportunity to appear benevolent. Instead, he is succeeding in painting me as a nattering nabob of negativism, as Spiro Agnew said. I know he takes great joy in that. Judging by the level of applause, he finds that highly entertaining. I would accommodate him further with maybe some kind words for the good work he has done, if he would just hand over the information that has been standard in the past.

Hon. Mr. Fentie: I'm not sure what a nabob of negativity is all about. I want to assure the member that there is no ulterior motive here. The information in the budget is quite detailed. I've articulated to the member the totals of the community breakdown in terms of capital investment, reading it on the record - and the government's side is very conscious of reading into the record the exact facts.

Let me, because the Member for Kluane has clearly demonstrated to the House here this afternoon that the member would have great difficulty in debating the budget without set information. Let me see if I can put together that information for the member, and we'll pass it on to the member as quickly as we can. We might have to have a break for that, though, Mr. Chair, seeing the time is 4:00 .

Chair: We typically take a break at 4:30 . Do members wish to take a break now?

Some Hon. Members: Agreed.

Chair: We will take our regular 15-minute break now.

Recess

Chair: Order please. Committee of the Whole will now come to order.

We will continue with Bill No. 20, First Appropriation Act, 2006-07. We will continue with general debate on Vote 12, Department of Finance.

Hon. Mr. Fentie:   With the Chair's permission, I have a bundle of documents that I wish to table. They will assist the Member for Kluane in debate. Even though we are in the Department of Finance and the capital expenditures in the Department of Finance are less than $300,000, we are going to table the entire community capital breakdown for the Member for Kluane.

We do this in good faith and with the expectation that the Member for Kluane - and indeed all members opposite - will then dedicate themselves to expediting the debate in the public interest. You will notice, Mr. Chair, that the documents do not include the numbers on this side. It's not something we reflect a great deal on, because we did construct the budget, so we have a good understanding of what's in both capital and operation and maintenance. I do hope that we can get on with the debate in the Department of Finance. As I pointed out, it is a department that plays a significant role in the corporate structure of government here in the Yukon, as it should. I mentioned earlier that I am blessed with good fortune to be able to work with the talented people we have in this department who have contributed a great deal to turning around the finances of the Yukon, strengthening our fiscal position and making their contribution to the overall benefit of the territory.

So with that, I hope the documents will help the members opposite, even though we're in the Department of Finance, with limited to no capital expenditure.

Mr. Hardy: Well, I'd like to thank the Minister of Finance for supplying summary community distribution. It's traditional. All governments do it, and I'm glad this is one of the traditions that this minister has followed, even though I do remember how many hours we spent a couple of years ago trying to get this document out of the minister.

I'm just going to ask a couple of questions here and explore a couple of things. The forecast says that the surplus for the year, from 2005-06, is $37,999,000 and the estimate for this year is $8,982,000. I have a very general question, a very relaxed question. Does the minister feel very comfortable with that change in the amounts, and does the minister anticipate that increasing because of the lapses?

Hon. Mr. Fentie: Mr. Chair, I think you have to reflect on actuals versus the revised estimates and the estimates for the coming fiscal year. You will see within that range, given lapses - I guess it is fair to say “historical lapses” at year-end, once all that is done and the final accounting is in, the government is comfortable, and I as minister am comfortable with the fiscal position as booked and projected. It shows us in a very healthy position overall. It wasn't that long ago that we were in year-end deficits, not year-end surpluses, and a great deal of effort has been put forward to get us to where we're at, and that is year-end surpluses and the fiscal framework we presented here with the 2006-07 budget.

Mr. Hardy: We can anticipate that figure to be substantially larger by next year. Is that what the government is anticipating, based upon the historical operations of government, lapses and that?

Hon. Mr. Fentie: I will say to the member opposite, in attempting not to split hairs, that the government expects - as all members in this House should expect - there will be changes to those numbers given the variances we go through each and every fiscal year. Some up and some down, but always variances, Mr. Chair. What has been booked as an estimate may very well, during the course of the fiscal year, change, as past fiscal years have changed.

Mr. Hardy: I guess from that I'm going to take it that the Minister of Finance is very confident that this is a figure that probably won't be going down, but is a fairly safe estimate for the coming year. Of course, with an election coming, who knows what we could be dealing with. Could the minister indicate to the Legislature the changes/recoveries from Canada - the 16-percent decrease in recoveries from Canada? I'm just reading the financial summary right now. I was in general debate when I left here. I thought I would still be in general debate. You can answer that question, can't you?

Chair: Order please. We are currently in Bill No. 20, First Appropriation Act, 2006-07. We have concluded general debate on the budget and are now in the Department of Finance.

Mr. Hardy: I have to apologize. I was out of the Chamber.

Hon. Mr. Fentie: As we move on, I'm more than willing to accommodate. Just so I can point out to the member what transpired over the fiscal year, before the supplementary budget was tabled, the year-end surplus showed $17 million. With the supplementary budget, as tabled, the estimated vote, or surplus for year-end, has gone up - changed upward - from $17 million to $37 million. Again, that's testimony to the variances we deal with during the course of the fiscal year and gives rise for us to be comfortable in the knowledge that our fiscal framework is sound and we're heading in the right direction overall.

We are in the Department of Finance; general debate did clear on the budget. The member asked about recoveries, and I believe the Deputy Premier did answer those on the floor of the Legislature during debate last week.

Mr. Hardy: I apologize to the Minister of Finance. I had left when we were still in general debate and assumed, when I came back in, we would still be doing general debate. Things changed slightly while I was gone. I do apologize and am now aware of what actually happened while I was out of the Legislative Assembly.

I have a couple of typical questions. I don't have them in front of me. On banking services, when does that contract come up? I think they're three-year contracts. Where are we at with that?

I don't have many questions on this department.

On the statistics on finance under treasury, taxation, permits, others and accounting, it's all showing a complete non-change. It has completely flat-lined, like it has just been carried over from the forecast of 2005-06 to 2006-07. With the greater activity in oil and mineral exploration and mining exploration, wouldn't we anticipate changes in the returns on the taxation? As the population increases, shouldn't we be anticipating some changes in those figures?

Hon. Mr. Fentie: With respect to the banking contract, I am led to understand there are three years left in the contract with the Toronto Dominion Bank. I think we recently entered into one - it's a five-year agreement, and two years have transpired. As far as the second part with respect to the taxation revenues - for example, with the mining exploration, the mineral exploration tax credit takes those taxes in and returns them based on that calculation or formula. As I see it, the forecasts and estimates are upward to some degree, although the estimates shown in some areas - like the line, fuel oil tax - Other, there's a small decrease of minus three percent. It's all based on a projection that, given the price, volume or consumption will decrease, and therefore the tax revenues from that decrease will also be reflected downward.

Mr. Mitchell:  Regarding the energy rebate program, I'm wondering whether there have been some lessons learned and whether next year, in terms of administering it, there might be some other steps taken to try to actually target people who are living in Yukon. I received a copy of a letter from a constituent to indicate that she has an aunt living in another province and she operates as a power of attorney for her aunt, so she carefully shows her address as “care of” for correspondence but nevertheless received an application. For that matter, our family received an application for an adult child who files tax returns as a resident of another province, but the mailing address for tax refunds, if there are any, or GST rebates, is Yukon . As a result, we received an application form for that person as well.

I'm just wondering whether there's - I know that the rebate was brought in on short notice to try to address a pressing problem with the passage of time. Are there some systems that will be put in place to try to catch some of those and avoid having these letters arrive?

Hon. Mr. Fentie: Well, I would argue that the program worked very well, because in this instance the department caught this. I will just recite the important part of this correspondence. “In developing the energy rebate program, we [the government] anticipated situations like that of your aunt; therefore, the requirement for residents to sign and return the energy rebate form was introduced as a way to ensure that the rebate goes to Yukon residents only.” So, in other words, an out-of-territory person, in sending the form back, would have had a postmarked envelope, for example, from somewhere else. So this was caught. I'm not sure if there were other examples of this, but I'm informed that the department also caught others because of the system they put in place of a signed form being mailed in.

Mr. Mitchell:  I also appreciate the fact that the department is making best efforts, but it could cause some families some confusion on their part when they receive these applications for adult children. I imagine that that might be a fairly frequent occurrence, if there is still some form of local address that's being used for some correspondence with Revenue Canada - CRA. Also, I guess, there is always the opportunity for it to tempt people into applying for things that they shouldn't be applying for. So again, I'm not asking the question to criticize the department but rather to say, with what has been learned this year, will there be a slightly different process put in place next year to try to cut down on those?

Hon. Mr. Fentie: The whole point of this program was to quickly address energy costs overall. It wasn't necessarily home heating fuel; it was energy costs in general. Every adult or child, provided they lived in Yukon, would be eligible for an energy rebate. The system worked very well. The department processed over 5,000 applications with a very short turnaround time for getting this rebate back into the hands or pockets of Yukoners.

On the point about next year, that decision hasn't been made yet; however, I think it's fair to say we should always learn from our experiences. To date, this program has shown itself to be not only beneficial, but quite effective operationally, because it has allowed the department to screen and ensure the rebate is flowing to Yukoners. As we know, some 7,000 families, based on our federal list for income tax - we use the tax list from the federal government - would have been eligible.

Mr. Mitchell:  To return to a question I asked last week in this Legislature, there were statements made, and I know the Finance minister will be quick to point out that we shouldn't accept everything we read or hear in the media as gospel. Nevertheless, there were direct quotes attributed to the businessman regarding the potential for a new business located in the minister's riding that may be able to relocate there, and that's to manufacture and produce airplane floats.

The owner of the company had indicated that there were financial incentives and special incentives and tax incentives that made it very, very attractive. We just asked a question regarding whether or not there were the commonly known small business investment tax credits and other programs, or was it just the rate of tax for small business, or were there new and special incentives being offered, because that was certainly implied by the company owner, saying he couldn't go into the details. Can the Finance minister tell us, from the perspective of being Finance minister, whether there are one-off or special tax incentives being offered to one company versus another?

Hon. Mr. Fentie: I think the member is referring to what exists already in manufacturing tax rates, which are very competitive with the rest of the country. Yukon is at 2.5 percent. To the Member for Copperbelt and to the Member for Porter Creek South - if I may for a moment review that with them.

The manufacturing tax rate of 2.5 percent, in comparison to the next lowest, is Newfoundland , at five percent and Quebec at 8.5 percent. But in jurisdictions relevant to this type of manufacturing - obviously this is coming from the west coast, California area - British Columbia is 12, Northwest Territories 14, Alberta 11.5 percent. There is one example. Then, of course, what this government brought in in the small business tax credit is another area.

No, there are not any special one-off arrangements with any company that I know of. At least, I have never been informed of such a thing. I'm sure the existing tax regime is looked upon quite favourably by a manufacturer considering our rates and where we are at. Then, of course, there are the advantages of being at a lake with a building the size of this World War II hangar that the individual is looking at - which is privately owned, by the way. It is not owned by the government or by the public. It is owned by a private individual or company. That may be an attraction, too, because the facility and its size allows for this type of manufacturing equipment to be put in place.

Mr. Mitchell:  I would agree with the minister that for this kind of operation, if the operation proves to be economical, it is certainly a good location, and we would be very pleased to see increased economic activity in Watson Lake. The purpose of my questions was because there might be other operations for other communities. It was the potential investor who was indicating there were special incentives being offered. That was the point of the question.

Several times today and recently, the minister has referred to the fact that the money for the contribution to assist Yukon College with the pension shortfall, the money for dealing with Dawson's debt, and the money for other items that may not have been in the budget would come forward in the form of a supplementary budget. Will the minister commit today to actually tabling, prior to the next election, a supplementary budget that would include these items?

Hon. Mr. Fentie: I guess that would all depend on when we call the election. However, that will not preclude, dissuade, or stop the government from addressing issues like Dawson City, the Yukon Hospital Corporation's pension issue, the Yukon College, or any other issue, because it's all based on sound fiscal management. We have the flexibility. We have certainly increased our options - what's available to the government. Three years ago we wouldn't even be having this discussion, because there was no way the government of the day had the ability to assist the college or the hospital in these areas. And the former government to a large degree created that Dawson is in, unfortunately.

So, yes, we're very comfortable, as we go forward into this fiscal year, which has just started, by the way - I think we're in day 18 of a new fiscal year - that we'll continue to manage the variances we deal with and manage - and that past governments haven't been able to do. The fiscal framework of the budget shows that the flexibility is there to do any number of things, and all trends and projections show that things will even get better, considering the federal government's view on fiscal imbalance.

Mr. Mitchell:  Well, a couple of things in that response would cause one to ask another question. Yes, it is only day 18, but we don't know how many days we'll have before the Premier will call an election. And, of course, only the Premier knows the answer to that. That's why we're wondering if we'll ever get to see another supplementary budget or if all these things are, in fact, just IOUs left to the next government. It's very easy to make promises if one doesn't have to fulfill them. But if spending authority is going to be approved by the Legislature, the minister so carefully pointed out today that there would then be a supplementary budget tabled. Now the minister isn't willing to commit to tabling such a budget.

So, of course, the minister could table a supplementary budget and then call an election anyway. At least he would have that document to say, “You see? This is what I stand for.” So I would ask the minister again to make the commitment on the floor of the House to table the budget rather than just leave them as unfunded, off-the-book liabilities for the next government.

Hon. Mr. Fentie: Well, I'm glad the newly elected leader of the third party has brought this issue up, considering the position that the Liberal government had taken in the past with respect to this very circumstance. There was a supplementary budget in 2002 that was not tabled. It was considerable. Upon taking office, we had to deal with that supplementary budget. The amounts were very significant, and they dramatically changed the fiscal arrangement for the territory by some $15.2 million.

Now, Mr. Chair, is the member saying that the third party has changed its stance on this matter? Because the member can't have it both ways. This is just part of governance. Elections will be called. Supplementaries will be brought forward, as they always are. The member also, in getting him back on track, must again recognize that the government has committed to what is always going to happen in the fall sitting: a supplementary being brought forward, even if it's only the year-end supplementary for the fiscal year that has just transpired. But there are going to be supplementaries. At the end of the day, I think the member should converse somewhat with his colleagues on their position with respect to supplementary budgets, when and how they are tabled and all that goes with it, because that's certainly not what the third party stood for in the past, and a demonstration of that is in the facts and figures of past budgets.

Mr. Mitchell:  It was a very simple question and it didn't get a very simple answer. I didn't ask the member whether we wanted to engage in a discussion about Liberal policies today versus Liberal policies in the past, but rather I asked the Finance minister what the Finance minister's approach would be. It was a very straightforward question: will the Finance minister be tabling the supplementary budget that he talks about as being the way in which the spending authority is achieved, or not? He hasn't answered the question.

The Finance minister has made references a number of times to how terrible the finances of the territory were when he came in and, in four short months, he brought us to what the public accounts said at the end of the year was a $70-million surplus of net financial resources. I think that's only half a story.

There may be governments that from time to time will make the decision to borrow money and pay overdrafts rather than liquidating other investments or using other resources, because the decision has been made that to do that over a short period of time might be in the long run more cost effective, rather than simply turning around and saying, well, we will liquidate the permanent fund, for example - which was created under the former government. Does the Finance minister truly want us to believe that, in four months, he dug out of this incredible black hole that he refers to and created $70 million out of thin air, and that's how it all happened?

 Hon. Mr. Fentie: That's exactly what I and this government are saying and have said all along. Now, let's get to the facts.

The member has alluded to some $70 million in surplus, but that took some work by this government coming into office over the period of time we were sworn in to when the year-end was actually booked. Let me cite some examples.

When we came into office, factoring in the supplementary that was not tabled by the members opposite when in government, there were no announcements or indication of what was within. The public accounts surplus/deficit for the year was a deficit of $6.1 million. Upon coming into office, this government collapsed such - and, by the way, the member has stated he chose not to use other funds or resources. Mr. Chair, they did not have any. There were no options, period, unless they did what we did.

We collapsed the permanent fund of $10 million. We went to work on the undercount with the federal government, increasing the TFF by almost $35 million. We collapsed Canada Winter Games funds of $8 million. We collapsed endowments of $1.5 million to create what then became an actual or forecasted accumulated surplus for March 2003 of $67.6 million.

This was not left on the books of the territory by the Liberal government. There was no money in the bank. This was created by the Yukon Party government, and you bet we're going to stand up and be counted for this. We made the decisions to create what we have today financially, not the members opposite.

The member opposite would be better served by portraying what transpired in this territory and not trying to re-create the past - but start focusing on the future, because that's their challenge. They have no plan, they have no vision, they mismanaged the finances of the territory; we came into office, cleaned house, cleaned it up and put the Yukon Territory back on the right track. This is another example.

When I think about what the member just said, it brings me back to a recent debate in this House with respect to the Workers' Compensation Health and Safety Board and what transpired outside this Legislature by not fully accounting in this House for all the facts and information. That is not something we on the government side will ever do. That's why we budget the way we do; that's why we manage the way we do; that's why we have no problem taking our record to the Yukon public in what will be the next general election in the very near future.

Mr. Hardy: I was waiting to hear when the speech was going to come - the speech we get every session and which we just got this session.

I can assure the members opposite, the Yukon Party government, that we will be talking about their spending priorities in the next general election. I know full well what line is going to be used, because it has been tested already by the Premier. That is: are you better off now than you were in 2002? That is going to be their campaign slogan. That line has been tested for the last year, and the Yukon Party is still struggling to get the public to buy it. They are not. Hopefully, they will run on that one.

I have to admit that I wasn't in government in 2002. I had a break. My constituents decided I should retire for two and a half years. I thank them for that. It was a nice break. I went back into private business, starting my company up again. In some ways - I say this for everybody in here - I physically regained my health. If there is one thing that all Members of the Legislative Assembly suffer from in this Assembly, it is a detriment to our health. As many of us know, it's the waist line, the stress level, the late nights and early mornings that get to us. Most of all, I would say it's the waist lines. We have struggled there.

The Member for Porter Creek South just passed me a note, which is very applicable. There has been a struggle in this building for many, many years about air quality. I don't want to deviate too much. When we are talking about healthy jobs and healthy environments, the whole structure, as the NDP has indicated by their legislative reform bill, needs to be changed and reconfigured somehow.

I think the only way that's going to happen is if we put aside a lot of our party politics and look at the structures we work under to relieve some of the opposition on all sides to try to find a better work environment.

But the building itself, too, has had problems, and I do know that the third party was having some issues around fumes in some of their offices. Those are long-standing problems that we face - and it does create toxic environments, toxic organizations, and maybe the Legislative Assembly is a little toxic for our health - maybe it's not the air quality, but what comes out of the mouths of people in here, that creates a lot of problems.

I can look around here and see the stress level. I can see former colleagues' health problems. I'm sure they can look at me and realize that I'm a little balder and a little heavier. I'll tell you, that changes once you leave politics. There's no question about it. So, I would say that we all owe it to the future politicians to try to make changes, and I think it's possible if we would agree on that.

I'll tell you what the debate is around this budget. Past governments have balanced the books. We haven't gone bankrupt. We haven't been called to task. We haven't had the treatment that the Yukon Party put Dawson City through. We haven't had that applied to us. That hasn't happened. Past governments have managed to keep the fiscal house in order through this territory.

So, pointing back and saying that the former Liberal government or the former NDP governments didn't know what they were doing, and only the Yukon Party government did, is not necessarily accurate. Otherwise, action would have been taken long ago. The NDP have been in the government seat for 14 years.

I didn't notice a bankruptcy. I didn't notice an Auditor General ruling that that government was out of control. The Yukon Party has been in for seven years total as a party - seven years, I believe. That would have been, of course, from 1992 to 1996 and, of course, from 2002 to whenever the next election is called - but it will be in this year, 2006.

I wouldn't necessarily say that the government was falling because spending was completely out of control. I haven't noticed that. The Liberal government had the honour of serving the people for two and a half years. I didn't notice that the Auditor General or the Finance department was advising the government that they were in tremendous fiscal difficulties. We didn't see it in the books after.

As the leader of the third party indicated, if, in four months, you find a $70-million surplus, that does not mean that the government didn't have resources. The government did have resources, obviously. It's the priorities that we witnessed. The Liberal government had a different approach. They had the permanent fund - there was a $10-million permanent fund, I believe, that was being put aside. I believe it was being put aside for the recognition that there may be a rainy day. I don't think that's a bad thing. Now, maybe the rainy day was when the Yukon Party got elected, and it has been raining since.

The census count had a significant impact. We all knew about that. But truthfully, that had nothing to do with whichever government was elected in that sense. The departments and the count itself had a lot to do with that. That was, I believe, $15 million right there. So you're looking at $25 million that was there: nothing to do with whatever government was in - $25 million, a significant part of the budget.

Those are just a couple of examples. Here we are, just three and a half years later, arguing the same thing. The Premier insists that there was a problem then. Maybe there was - maybe that's the perspective - but from my own perspective, I try to look in a broader context and see if there were funds there, if there was money there. If there was a problem, there was money coming or else there was a permanent fund that had been created that could have been used. There wasn't a crisis or a deficit that the Premier seems to want to keep going back to. I just can't buy it.

I'll tell you what I find shocking about this budget and past budgets: the phenomenal amount of waste. That's what bothers me most at this time. We can use a multitude of examples here. We can use the multi-care facility that is happening in Watson Lake - $1.5 million on design work, on inspection work on the existing hospital - $1.5 million when the structure is only $5 million some - and you are spending $1.5 million. That is waste. That is completely out of line. There is no building that I know of that has that amount put toward the initial engineering and design costs. I've heard the new - because I have to remember to say “new minister”, because he always stands up and says, “I've only been on the job a little bit, and you are attacking the public servants; therefore, don't ask me any questions.” He took the job on; he's responsible; he has to grow up. He has to take that responsibility. If he can't take that responsibility, Mr. Chair, then maybe he should get out of the job.

But $1.5 million is an example of waste. $500,000, $540,000 - justifiable because there were prices in that area. I can't see another $1 million to look at some of the problems with the existing building. I'm sorry. I've been in this industry. That was my industry; I worked on buildings. What is going on down there?

Sole sourcing - we can almost always identify sole-source contracts. They have a tendency to come in at one price and, the next thing you know, there are additions. This government is famous for it. Where is the accountability around sole sourcing? We have serious problems around that.

The Whitehorse Correctional Centre was a project that has long been in the works. The NDP government started working on that one. When the Liberal government came in, they continued that work and brought it forward. They pre-loaded the ground. I stand to be corrected, but I think the design work had been completed, with consultation. That was carried over from one government to another. But then, for some reason the attitude around the Yukon Party government was that they would not recognize any of the previous work of any other government. They shut it down, they blocked it, they stopped it.

I don't have a criticism about the programming and direction of some of the work they have done in programming and looking at that area. But there was nothing that said you had to stop the work on moving forward on a building that is desperately needed. What does this government do? It spends over $4 million, as I understand, on patching a building that has to be replaced - $4 million on a building you are going to tear down. That's waste.

That's waste - when that $4 million could have gone to the new building. Another bad decision, and we still don't have a new building. The next government is going to inherit that problem because this government didn't have the courage to move forward on it - $4 million.

But you know what, Mr. Chair? They will find $3 million for a railway feasibility study that will produce some paper. Now, that's very expensive paper. There are already studies out there. Why? Because the Governor of Alaska wanted this government to do it. Now, is that going to house anybody? Is that going to feed anybody? Is that going to get the results? Is that report going to say, “Yes, that railway should be built, and the governments should pay for it, and the private sector should run it, and the government should subsidize it.” - because, guess what? That's how almost all railroads right now are operated. So, why would this one be different?

Common sense says that this railway is going to need one heck of a lot of development happening in the territory and Alaska. It's going to need one heck of a lot of activity - far more than the population or the resources or the activity that's happening here now - to justify it. That's common sense. That's free. I'll give that out freely.

$3 million - there's another $3 million, on top of the $4 million - waste - $7 million. The multi-care facility - another project gone sideways. The Dawson bridge - we stood in the Legislative Assembly and said that bridge was going to cost anywhere from $45 million to $50 million. The Yukon Party laughed at us and said, “No, no, it can't cost any more than $25 million.” Great job, great project.

We said, “Do not do the P3 on this.” They said, “No, we're going to go ahead. It's the cheapest way to go.”

Again, waste. So when the Premier stands up and talks not about the Department of Finance but about the spending and budgets of past governments, then the Premier should also recognize, just from the very few examples, I'm over $10 million on waste. How about the Carmacks school? What about the finances on that? $2 million over. Now we're at $12 million of waste - waste because of poor planning, poor management, poor budgeting and a poor budget. I don't think financially we have that kind of money to throw around, but obviously the Yukon Party government is doing it.

Frankly, I'm shocked that we continue down this road.

So before the Premier wants to go around pointing fingers at past governments about how bad the finances were under them, maybe the Premier needs to take a very close look at his own operation, and maybe the Premier needs to identify as Minister of Finance that there has been a tremendous amount of waste, and he should be reining in some of that waste. The Minister of Finance does have a responsibility in this area, and those are just small examples. There are a lot more out there. You know, Mr. Chair, the public is very aware of that; they're very aware of it.

I look forward to hearing the comments from the Minister of Finance or, if there is somebody else who is going to stand up, to explain to the opposition how their budgeting does not contain waste and all these projects are on time, on budget, and the finances of this territory are in perfect shape, and they never were before, as the message keeps coming out.

Hon. Mr. Cathers:   That was an interesting monologue from the leader of the official opposition.

Again, I just have to point out to the leader of the official opposition that when he talks about poor budgeting and poor financial management, he has one opinion and the Auditor General has an entirely different opinion of how this government has proceeded in reporting the government's liabilities and fully disclosing the financial picture of the territory, and reporting that.

I remind the member again that the Auditor General has been very complimentary of the steps our government has taken to improve the manner in which the Yukon government is booking its liabilities and responsibilities, and disclosing that.

Under previous governments there were issues such as the employee leave liability, which was capped at $30 million when, in fact, it was somewhere around $42 million. I believe that was the figure it was at when we fully recognized the value of that. This was not simply the manner of the previous government, but governments before that have dealt with that in a similar fashion.

Again, I would point out to the member opposite what a qualified audit from the Auditor General means. When the Auditor General issues an approval with qualifications, it notes that they are not entirely satisfied with how the government is reporting the state of their finances.

The member is correct in saying that the Auditor General never said that the Yukon governments previous to this one were not getting anywhere near the vicinity of doing proper budget reporting.

However, the Auditor General noted very clearly that they did not fully approve of the manner in which the government was stating assets, liabilities, expenditures, et cetera, particularly with regard to the issue of liabilities. If the member opposite wants to talk about things such as disclosure, or if the leader of the Liberal Party wishes to talk about disclosure, we can talk about things such as the Connect Yukon project, which when proceeded with by the then NDP government was dealt with through requiring payments down the road. It was dealt with through the establishment of a numbered company, the use of the immigrant investor fund, and resulted in a balloon payment down the road years later of millions of dollars - the costs and the liabilities were in that manner. This was again the previous NDP government back, I believe, in 1996-2000, which proceeded with that decision and they did not fully disclose the liability. It did not show up on the books.

This government fully books and recognizes the liabilities with which it is faced. We fully recognize our financial responsibilities. I point out to the member opposite that, contrary to the previous government's way of doing things, what we have done with any of these items that are not addressed in this current budget is, as we become aware of upcoming liabilities and financial responsibilities, we are disclosing those figures to the public. As the Finance minister has stated, we have to pick those numbers up in the supplementary budget process in the fall, but we are laying the number out right now for Yukoners to be aware of.

We are not sweeping it under the carpet. We're not refusing to disclose the figure. We're putting that number right out there in a press release so Yukoners can be aware of it, or we're announcing it on the floor of the Legislature. Any Yukoner can take the budget here today and can recognize numbers such as this, which will have to be addressed down the road. Any Yukoner can also look at items such as increased revenues, unexpected - as I've stated before, the process of budgeting incurs in a fiscal year both unexpected costs and unexpected items that are not expended. It's a process that changes. To expect that one budget is going to be the financial picture until the end of time is simply not realistic. We fully disclosed the financial picture to the moment, as we know it, and are doing so. The budget is there and, again, we made it fully and in an accountable manner, and I will note that even if the leader of the official opposition is not satisfied, the Auditor General is.

With regard to items such as the Dawson bridge, the leader of the official opposition, again, stands on his feet and claims credit for accurately predicting the cost. Anyone who reads through Hansard will note that the opposition came up with several different predicted numbers, and so they can pick and choose which one was going to be the accurate prediction. Again, the cost of the Dawson bridge did turn out to be more than originally anticipated, so we have not built the Dawson bridge. But the member opposite is doing a disservice to the public by not acknowledging that the significant increases in the price of steel were the primary cause of a significant increase in the anticipated cost. Anyone who is familiar with the construction business in its current state is well aware that steel prices have shot up significantly. That is a significant increased cost for a steel bridge.

With regard to the railway study, again the member opposite shows a lack of vision in standing here and suggesting that a railway can be of no benefit to the territory. He ignores history, in not noting that railways have been nation-builders in the past. And although now, with an existing infrastructure, we do have other ways of transporting things, rail is still the most efficient means of transporting large volumes of goods. And, by the way - and I hope the member opposite will be interested in this - transporting things more efficiently is due, in large part, to less fuel expended, which means less greenhouse gas burned, less pollutants into the atmosphere.

It's simple math that anyone can look at and, of course, the railway feasibility numbers are about coming up with the exact numbers and not the projected numbers - but anyone can take a look at typical costs of rail. They can take a look at the mineral deposits we have here and some of the resources that could potentially be shipped to other areas by rail that are not currently feasible to ship by truck or by ship, perhaps, but would be through that. They can look at that. They can understand how that has potential in that area.

Again, we see the Liberal Party's flip-flop, where previously, as stated by the federal Member of Parliament, Mr. Bagnell, a campaign commitment was made in 2004 for the federal government to support the railway feasibility study and they have not honoured that commitment. Unfortunately, they did not do so before their time in office ended. And today, the Liberal Party stands up and now they're not in favour of a railway feasibility study.

Again, I have to wonder if the NDP's real objection to a railway feasibility study has to do with, again, their known predisposition of not really being in favour of resource development.

Again, this government is committed to resource development in a responsible manner, working with First Nations, residents, communities, and the public as a whole, ensuring environmental protection and recognizing community needs, but allowing resource development where feasible and where it can be done, mitigating the risks and impacts to the public and to the environment, of course.

On another matter, we have the member standing up and minimizing the importance of the correctional reform process. It is interesting that this has been getting more attention nationally, in some ways, than it has locally. There are a number of other jurisdictions that are now looking at what the Yukon is doing in correctional reform and recognizing that it is ground-breaking. To stand up and suggest that the previous Liberal government's consultation process, performed on the construction of a new jail facility, was the same as overall correctional reform and discussion, is simply not accurate and does not accurately represent the facts.

The previous Liberal government was doing consultation on a proposed facility. That is the fact of the matter. They proceeded with that. We were very up front from the beginning that we felt there was a need to review what programs would be delivered so the end facility would be designed to deliver the programs properly, rather than simply warehousing inmates. The member can disagree with that, but he should not inaccurately represent the facts of the matter.

Again, with regard to some of the member's comments about his perceived vision of financial management and how this government performed upon taking office, I would point out that we did dissolve the $10-million permanent fund but, with regard to the $15 million that had been booked as a contingency pending the outcome of the census review, that money was not collapsed into the general fund until the fall of 2003. So, at the end of the 2002-03 fiscal year, it was not included in that year-end surplus position.

That money, in the fall of 2003, went through the hard work of the Finance officials and the stats branch. We were successful on the national stage in not only not having the decrease, which had been anticipated in territorial revenue due to the outcome of the census count, but we actually had a $23-million increase due to the hard work of officials in laying out the argument to the federal government and proving that they had been undercounting the number of Yukoners retroactive to 1996.

At that point the $15 million, which had been set aside as a contingency reserve, was, of course, repositioned into general revenue as it was no longer needed. Mr. Chair, I could go on at length regarding the comments of the leader of the official opposition, but at this time I would like to entertain some more questions and just also urge the member to review what the Auditor General has said about the efforts made by this government and question whether his accusations that he is making toward the government with regard to financial disclosure are, indeed, accurate, considering that the Auditor General is not only satisfied with the performance of this government, giving unqualified approval for three consecutive years to our financial reporting but was also, in fact, very complimentary about the steps we have taken to implement generally acceptable accounting principles as laid out by the Public Sector Accounting Board of Canada and through the recommendations of the Auditor General.

Mr. Mitchell:  I don't have much more for this acting minister, but I will preface my question by saying that, since the Acting Minister of Finance has stressed the importance of accuracy, when he reviews the Blues I am sure he will find that we did not, in fact, speak out in opposition to the rail or port studies, but rather what we asked today was whether there would be an attempt to get some commitments by other jurisdictions, such as British Columbia and Alberta, in the case of the rail study, and Alaska, in the case of the port study, to put real funding, as opposed to moral support, into the study. In the interest of accuracy, we shouldn't be paraphrasing people's questions to give different meanings to them.

I just have one really brief question. I don't know if the acting minister can answer this, but there was some discussion earlier about banking services. I am not sure I caught the date that the current agreement expires, but recently I had a couple of business people in smaller communities request that we ask the government, when they next negotiate those services, if they can pursue some expanded hours in those communities. It has a big effect on small business people in conducting their business affairs to have the banking service open longer hours - not just for their own benefit but also for the benefit of the people in the community, which helps to keep their dollars in the community, as opposed to having to head to Whitehorse to do their banking, which then means that inevitably the dollars are spent out of those small communities.

I am wondering if the acting minister can perhaps make that commitment or provide some information after discussing it with the officials.

Hon. Mr. Cathers:   With regard to the third party's comments regarding the banking services, that's a matter - as the member is aware, it's not my portfolio. I'm acting and responding to these questions. However, that is a matter, I am advised by the department, that we can certainly consider. We're not quite at the end of the banking service contract. It is a matter that can be incorporated in a tender. And there have been in the past, and will be at the next juncture, certainly if this government is in office, the attempt to ensure that communities' needs are considered when we next do the banking service contract. There is a cost to increased hours, and that has to be taken into consideration and discussed with the communities with respect to what point is value for dollar.

But it certainly is a point that has some validity to it, and I do thank the member for his correction, since he has made that, regarding his comments on the rail feasibility study. I must confess that I was only half-listening when he made his comments earlier today, and I will certainly correct the record and note that, based on the member's assertion that he did not apparently today state an objection to the rail feasibility study - however, I will qualify that by noting that I made that assumption based on the fact that on several occasions in the House he has previously stated an objection to us proceeding with that and suggested that it's a waste of money. I certainly did jump to a bit of a conclusion today, but it was based on his past comments, contrary to that study.

I would also like to point out that, if he is going to talk about ethics and if we're going to talk about accuracy of statements, the comments made by the leader of the Liberal Party in Question Period earlier this month, during which he quoted a portion of a sentence from a report done by the Ombudsman - when the whole sentence is read, it creates a very different picture from what was presented by the Liberal leader.

The matter under discussion was the Workers' Compensation Health and Safety Board. With regard to the question as raised by the member at that time, what the sentence actually said was, “While I have concluded that the board's action is contrary to law, I am satisfied that the board's efforts to correct the situation are reasonable”. Quoting only a portion of the facts in a manner that creates an impression 180 degrees from what the facts are is not very ethical. I would suggest that the member -

Unparliamentary language

Chair: Order. Order. The member knows full well what the Standing Orders are and what they are regarding charging another member with uttering a deliberate falsehood. However the member may choose to phrase it, that is indeed what he has done, and I would ask the member to retract his statement.

Withdrawal of remark

Hon. Mr. Cathers:  Thank you, Mr. Chair. I of course respect your ruling. It was not my intent to accuse the leader of the Liberal Party of uttering a falsehood, but apparently you considered my assertion that bringing in a portion of the facts was tantamount to the same to be also out of order, and I do retract that and apologize for my comments, as per your direction.

I would like to, at this time, for the benefit of members, table a copy of what the Ombudsman's letter said and urge members to draw their own conclusion, and the media may wish to take a look at this as well.

Mr. Mitchell:  It seems that we have ranged rather broadly from the Department of Finance, but I would point out that I have no problem with the acting Finance minister tabling the letter. I think that if one reads the letter, there is more than one reference to the fact that there was a lack of compliance and that was the basis on which the question that he refers to was asked. It's stated in two different areas of the letter that that is, in fact, what is happening. It was only a technicality that the Ombudsman was referring to in it being onerous, I believe, for the Workers' Compensation Health and Safety Board to comply - this side of a new computer system. But we will save that debate for another day.

Mr. Chair, at this point, I don't see any other members looking to ask questions. I would request the unanimous consent of Committee of the Whole to deem all lines in Vote 12, Department of Finance, cleared or carried, as required.

Chair: Before the request is put forward, does any other member wish to ask any questions on the Department of Finance?

Unanimous consent re deeming all lines in Vote 12, Department of Finance, cleared or carried

Chair: Hearing none, Mr. Mitchell has requested the unanimous consent of Committee of the Whole to deem all lines in Vote 12, Department of Finance, cleared or carried, as required. Are you agreed?

All Hon. Members: Agreed.

 Chair: I believe there is unanimous consent.

On Operation and Maintenance Expenditures

Total Operation and Maintenance Expenditures in the amount of $5,295,000 agreed to

On Capital Expenditures

Total Capital Expenditures in the amount of $297,000 agreed to

Department of Finance agreed to

Chair:    The Chair seeks some direction as to which department we are going into next.

Some Hon. Member: (Inaudible)

Chair: I understand we are going into the Department of Tourism and Culture. There has been a request for a five-minute break to change officials.

We will reconvene in five minutes.

Recess

Chair: Order please. Committee of the Whole will now come to order. We'll continue with Bill No. 20, First Appropriation Act, 2006-07, Vote 54, Department of Tourism and Culture.

Department of Tourism and Culture

Hon. Ms. Taylor:  Mr. Chair, I am very pleased to be able to speak to the 2006-07 budget for the Department of Tourism and Culture. I'll start off here by itemizing our budget within the capital, and then going over to the operation and maintenance budget.

Within the capital budget for the Department of Tourism and Culture, we have allocated almost $4.5 million - and dollars, I might add, that are very integral to supporting tourism, as well as the arts, heritage and archival communities.

The budget certainly cultivates future opportunities that lead us into the next decade and beyond. It also provides funding necessary to carry our past into the future.

I'm very encouraged by the growth of our tourism economy and the good work accomplished over the last three years with respect to museums, the arts, heritage and archives. This budget will certainly allow us to create opportunities and to advance stakeholders' needs and concerns.

The government has certainly demonstrated our openness to working with stakeholders on a partnership basis. We have worked together with our clients and First Nation governments to preserve our past while planning and preparing for the future.

A number of items housed within the capital budget here are very good initiatives, some of which I spoke to earlier in this sitting and earlier. Our initiatives that have been identified are deemed to be priorities among the tourism industry. One of those special initiatives is the tourism cooperative marking fund that was initiated by our government in May 2004 as an opportunity to energize and revitalize tourism activities. This budget continues to support this fund to encourage market-ready tourism businesses, First Nations, municipalities, organizations and partnerships in the promotion of Yukon tourism product.

The other special program that we have allocated dollars toward is the scenic drives program, for which $350,000 is allocated in this budget. Our government's scenic drives initiative continues to show and tell the world about Yukon 's stunning beauty and all the very many attractions that can be found on our many scenic highways.

We have identified $220,000 for implementation of our product development plan, which has been planned in sync with industry for workshops, product development, land use planning, capacity building, along with annual marketing research - critical for the development of our tourism industry.

We will also be allocating dollars once more for upgrades and necessary maintenance for our visitor information centres to the tune of $68,000. We are very pleased to provide, this year alone, $1.5 million in capital funding to Yukon 's museums and interpretive First Nation cultural heritage centres. I could talk at great length about our commitment to heritage, but I'll save that for another moment.

This builds upon our commitment of $500,000 to the expansion of the MacBride Museum. It also speaks to a couple hundred thousand dollar increase to the museum's special projects assistance program - a brand new program that was announced by me about a month ago. It will expand on current capital projects for museums for specialized exhibits and small capital projects.

We also have within the budget a new virtual exhibit about Mount Logan , and that is around $118,000. The best part of this partnership with the federal government is that funds for virtual museums are 100 percent recoverable and that will support new media growth in the territory.

We are pleased to carry forward with funding for First Nations cultural centres, in the amount of $220,000 - again, building upon our commitment to meet our government's obligation under chapter 13 of the Umbrella Final Agreement. This budget will also continue to work with First Nations on historic sites such as Rampart House, Forty Mile and Selkirk, as well as other archaeological projects, such as the incredible findings during the ice patch research that we have been conducting over the last number of years.

Also within this budget we have $135,000 in Yukon Archives allocated to conserve and protect our documentary history and another $50,000 to ensure that these records are made available to the public.

Certainly, as we move forward to the 2007 Canada Winter Games and the 2010 Winter Olympics, the department has been increasing the capacity of the cultural community by choosing to support the Culture Quest initiative that we have in partnership with the Yukon Arts Centre. That is $157,000 to plan, promote and coordinate an array of arts and cultural activities that showcase Yukon culture in the respective communities.

The remainder, the $43,000 is, again, on top of the $200,000 that we already contribute to the Yukon Convention Bureau on an annual basis. We are pleased to provide support to the Yukon Convention Bureau for sport- and tourism-related activities.

We have also allocated a dollar vote to the arts and heritage village on the Whitehorse waterfront. As was stated in a news release earlier today, we will be coming out with a series of public sessions in order to engage the public in further discussion on an arts and heritage village. The Whitehorse Chamber of Commerce and Artspace North have come forward with an initial vision of an arts and heritage village for the Whitehorse waterfront. We have had an opportunity to review the design plan, and we are pleased to move forward by engaging the public further on the future interests of the waterfront, particularly the Yukon government's portion at the foot of Main Street.

As I said on a number of occasions, it is really essential that any future development on the waterfront reflects the vision and aspirations of Yukon citizens particularly, as well as ensuring that work that is already in the works or being planned is complemented by further work taking place on the waterfront. So we're pleased to move forward with open dialogue with the Yukon public on this initiative.

Mr. Chair, just moving quickly over to the operation and maintenance budget, we have roughly $15 million toward operation and maintenance in the Department of Tourism and Culture. As I mentioned earlier, as we move closer to the 2007 Canada Winter Games, there are great opportunities for the Yukon. Part of our commitment to ensuring the games' success is a contribution of the second million of our $2-million contribution toward a pan-northern marketing campaign that will see the three northern territories working together to promote the north to the south.

It's a wonderful opportunity, and we are certainly continuing to work very closely with the host society to ensure the games are a success and to also realize and grow opportunities that come out of the games into future years by leveraging that recognition.

We've also designated $200,000 for the new Yukon tourism brand strategy that we will soon be launching. We're very pleased to be able to support this initiative. It's important to note that the development of a new Yukon tourism brand strategy was initiated as a priority by our senior marketing committee of the Yukon tourism marketing partnership and that the whole process has been led by industry. We are pleased to take their lead, and they're very proud of the tourism brand that has been developed. We're also very pleased to support industry in this regard.

It's critical to note that there was a lot of input provided toward the development of the tourism brand. Over 3,000 surveys were conducted with individuals from Yukon , Canada, United States, Europe and so forth.

We look forward to officially unveiling the new brand, complete with logo, tagline and ways in which we can further utilize this brand to further leverage the Yukon as a worldwide destination.

 Of course, I would be very remiss if I didn't mention that we also provide close to $1 million in operations funding for tourism-related stakeholders and events. We are very pleased to provide industry with these continued dollars. They certainly do a remarkable job on Yukon's behalf. They not only put people to work but they create more jobs by being able to market the Yukon to many of our primary markets worldwide.

In this budget, of course, we will continue funding to the Yukon Quest, the Yukon Sourdough Rendezvous and the Dawson City Arts Society. As I mentioned earlier, we are continuing our assistance with museums and, within the operation and maintenance budget, we have $178,000 toward their general operations.

This is certainly a very exciting year for tourism, arts and heritage communities, as we are able to showcase our strengths to the rest of the world in preparation for the 2007 Canada Winter Games. I am very pleased to present this budget to members opposite. I look forward to responding to questions.

Mrs. Peter: I appreciate that information from the minister.

Ever since I became the critic for Tourism and Culture, I have learned quite a bit about what industries are involved within this department and how important the tourism and culture industry is to the Yukon, since it is one of the key economic drivers in our territory. I guess the main purpose of this industry is to generate long-term growth, so that all Yukon people can benefit by doing this in partnership with the private sector, municipal governments, municipal organizations, First Nation governments and all other levels of government in the territory.

Tourism is not only about marketing the Yukon's beauty, but it also promotes the rich arts and culture that we have in the Yukon . We have a rich history in the Yukon , which we're all proud of.

I believe that the rest of Canada has a lot to learn from our northern people, which they might not know today but they will know when they learn more through the different strategies that this department has in educating the rest of Canada and the world about who we really are.

The minister had mentioned the Canada Winter Games. This gives us a great opportunity to showcase the three northern territories. It is a perfect opportunity for people in the north to educate people in the south about who we really are, who we are as Canadians and how much we have contributed to Canada and to the history of Canadians. I think it's about time people in the south paid attention to that because it seems in this day and age that we still have to teach our fellow Canadians about who we are as Yukoners and why we are so disconnected from the rest of Canada - I'm not sure.

I had an opportunity to travel across Canada a few times. It gives me an opportunity to meet people and learn about the different cultures across our country, and it gives other people an opportunity to learn about me and where I come from. I am always very proud to let people know that I come from the Yukon. I never hesitate to share our Gwich'in culture with people in other parts of the country or other parts of the world. That gives us a strong connection to the rest of the people in Canada.

When I think about marketing the Yukon to the rest of Canada, to North America and to the world, it seems like such a huge undertaking, and it's such a challenge to market what we have, because the beauty that we have in the Yukon is the best in the whole world. You would think that it wouldn't be hard to promote such beauty and such wilderness. On the other hand, not all people are interested. They'll travel to a certain part of our country - and we're hoping to the Yukon - to see the beauty in our lands and surrounding areas. However, not all people want to go out into the wilderness. They would like to stay in a high-class hotel and take a bus ride to maybe a smaller community and experience some culture and then come back to the hotel, where they can experience some other arts and culture in the territory.

Hopefully, we can cater to people from all walks of life, to their different needs and to the different experiences they would like to have when they travel to the Yukon .

I have spoken to many people throughout our territory who would like to promote their small businesses in wilderness tourism, and people are talking about the different small businesses that they would like to start for themselves. It is a really exciting time for Yukoners, and especially for First Nation people, because it's a time now in history where people are moving forward within their own self-government mandates and they're looking to their future for a better economic future for their people - and tourism is certainly one of those areas that's being talked about right now.

In light of the time, I move that we report progress.

Chair: Mrs. Peter has moved that we report progress.

Motion agreed to

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

Chair:      It has been moved by Mr. Cathers 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?

Chair's report

Mr. Rouble: Committee of the Whole has considered Bill No. 20, First Appropriation Act, 2006-07, and has directed me to report progress on it.

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

Some Hon. Members: Agreed.

Speaker: I declare the report carried.

Hon. Mr. Cathers:   Mr. Speaker, I move that the House do now adjourn.

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

Motion agreed to

Speaker: The House now stands adjourned until 1:00 p.m. tomorrow.

The House adjourned at 5:59 p.m.

The following documents were filed April 18, 2006:

06-1-130

Whistle-blower Legislation: correspondence among caucuses regarding Select Committee on (Hardy)

06-01-131

Capital Budget, 2006-07 summary community distribution, Government of Yukon (Fentie)

06-01-132

Ombudsman, Complaint to Office of the, letter (dated March 27, 2006) from Hank Moorlag, Ombudsman, to Robert King (Cathers)

PDF Version