Whitehorse, Yukon

Tuesday, November 27, 1990 - 1:30 p.m.

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



Speaker: We will proceed with the Order Paper.

Introduction of Visitors.

Are there any Returns or Documents for tabling?


Hon. Mr. Penikett: I have for tabling a legislative return.

Hon. Mr. Webster: I have for tabling today four documents that are entitled Forest Resources Policy Options for the Yukon, Markets for Yukon Forest Products, The Forest Industry and the Economy of the Yukon, and A Forest Tenure System for Yukon.

Hon. Mr. Byblow: I have for tabling some legislative returns.

Speaker: Are there any Reports of Committees?


Introduction of Bills.

Are there any Notices of Motion for the Production of Papers?

Notices of Motion.

Are there any Statements by Ministers?


Yukon Forest Industry: Related Studies

Hon. Mr. Webster: Today I have tabled a number of studies on forestry issues. These studies demonstrate some of the work that the Department of Renewable Resources has directed toward achieving an important objective of this government; that is, the transfer of forest management responsibilities from the federal Department of Indian Affairs and Northern Development to the Government of the Yukon. Other work is both completed and underway in preparation for forestry devolution. The Department of Renewable Resources has developed a negotiations mandate and has completed preliminary land, facility and equipment inventory assessments of the forest resources component of the Northern Affairs’ Yukon Forestry Service. It is also continuing work to detail the human and financial resources available to that program. Currently the Yukon government has management responsibilities for forest resources on Commissioner’s lands only.

The first of the documents tabled is entitled Forest Resources Policy Options for the Yukon. This study was undertaken by John S. MacTavish Resource Management Consultants for the Department of Renewable Resources. It is a first step toward meeting the Yukon Economic Strategy commitment to develop, in consultation with industry, model forest legislation in advance of devolution. This legislation will set the context for forestry management upon the transfer of forestry to the Yukon government. It will involve the complete forest management system, including new types of land tenure, resource royalties, development strategy and reforestation.

The MacTavish study makes specific recommendations on inventory techniques, management planning, tenure options, harvest regulations, silviculture, forest production, compensation, revenue and stumpage. This study will be used as the basis for public consultation on a Yukon forestry policy in 1991.

In order to obtain a more complete understanding of the opportunities and constraints to the development of the Yukon’s forest industry, the Governments of Canada and the Yukon signed a special agreement in October 1986. The Yukon Departments of Renewable Resources and Economic Development: Mines and Small Business, Indian and Northern Affairs Canada and the Canadian Forestry Service agreed to finance an 18-month series of studies on the Yukon’s forest industry. This work was also supported by the Yukon Forest Industry Association.

Three of the reports tabled today are a direct result of this cooperative agreement and were prepared Colin Heartwell, an employee of the Department of Indian and Northern Affairs. Due to multiple delays in editing, printing and verifying data, these reports were not released by the federal government until late July 1990. Copies of these reports have been distributed directly by the federal government to individuals, companies and agencies comprising the Yukon forest sector.

The Forest Industry in the Economy of Yukon report provides a detailed overview of the Yukon forest industry and operations and examines the competitive position and efficiency of various industry sectors.

The second report, Markets for Yukon Forest Products, outlines the production and capacity of Yukon forest products firms and the potential for local, national and international markets for their products.

The third report, A Forest Tenure System for Yukon, catalogues the various systems that governments in Canada and Alaska use to grant rights for the commercial harvesting of forests and evaluates the present tenure system in the Yukon.

The Government of the Yukon will continue to consider the conclusions of these studies in preparing development strategies and policy for the forest sector.

All of these studies will assist the Government of Yukon in meeting forestry commitments outlined in the Yukon Conservation Strategy, released in May 1990. These are: to “work to acquire responsibility for forest management and develop comprehensive forestry legislation; to establish conservation and sustainable use of the resource as underlying principles of forestry legislation, programs and policies”; and to “consult the forest industry and forest users during the preparation and development of legislation”.

Thank you.

Mr. Lang: We on this side are amazed that the Government of the Yukon would proudly stand in their place today and brag about their achievements thus far in the forestry industry and then tell the public how they should take over the responsibilities of this very important industry, when Yukoners have witnessed one of the worst cases of environmental devastation in the handling of the Watson Lake sawmill. Approximately 300,000 trees, averaging 150 years of age, were logged in that operation and this government permitted the majority of these trees to become diseased. Yukoners witnessed the remains of these trees either being burned in the sawmill area or being sold at a bargain rate price for firewood.

The irony of this environmental tragedy is that if the company had been privately owned, the side opposite would undoubtedly have been calling for a public inquiry.

The unfortunate aspect of this statement is that the 300,000 trees that were logged in the Watson Lake area will take generations to replace, especially in view of the fact that this government did not require that silviculture take place; therefore, the replanting of trees was not required.

I cannot understand why the Minister would be so proud to stand in his place today to announce and table three studies commissioned in 1986. They were originally intended to take 18 months to complete. We are almost beginning a new year, 1991. Those studies are over three years late being completed.

I would ask the Minister this: why has it taken over three years to complete these studies, over and above the original target? Secondly, how much has it cost to complete these studies?

I would conclude by saying that I can only hope, on behalf of the people of Yukon, that if this government does eventually ever take over the responsibility for forestry in the Yukon, that they do not manage it the way they devastated the Watson Lake forest, when they were in the sawmill business.

Hon. Mr. Webster: I hardly know where to start to respond to this flow of misinformation and selective material the Member has used to deal with this situation. He is accusing our government of single-handedly destroying 300,000 trees in the forest in the Watson Lake area as if we had complete control over that situation.

I will be dealing with a number of questions raised by the side opposite on this matter of forestry devolution for a while.

Speaker: This then brings us to the Question Period.


Question re: Decentralization

Mr. Phelps: I have some questions with regard to decentralization. I am particularly concerned about the impact it is having on the employees, especially those in advanced education.

Last April, when we were discussing workplace harassment in this House, the Minister for Education said the problem was confined only to advanced education. In Hansard, page 1475, he stated, “I reassured them that the future of advanced education and training branch is one that is absolutely assured.” The career services office is being shut down as of January 11. The staff has been given until November 30 to decide if they want to move. There are packing boxes all over the offices right now. Another department has already started to move into the offices occupied by career services.

I would like to know if career services was singled out for decentralization on the recommendation of the deputy minister?

Hon. Mr. McDonald: It certainly conforms to the theme of attacking particular civil servants as an easy grab at headlines, but, apart from that, the allegations the Member is making are not true.

The matters we were discussing last year were allegations of workplace harassment. The Member treats that as not only fact, but that it is also widespread throughout the whole of advanced education. I made reference to there being problems in advanced education and I was dealing with those problems.

The branch services are being assured. The assumptions the Members are making is that because a service is being decentralized, it means the service is being canceled. They are assuming that because the service is being transferred to Mayo, it is somehow less of a service or inappropriate somehow and that legitimate services only take place in downtown Whitehorse. I find this offensive.

The career services branch...

Speaker: Order please. Will the Minister please conclude his answer.

Hon. Mr. McDonald: ...was and is being decentralized for a very good purpose and for good policy objectives.

It was a decision by the department and a decision by the Cabinet to do so.

Mr. Phelps: Of course, he did not answer my question. What concerns me was that there is no question that there were all kinds of allegations about workplace harassment emanating from the department of the Minister and an almost complete turnover of the jobs in the administration branch of Education. It has all occurred since that particular individual became deputy minister. I would like to know whether or not the decentralization of career services is a continuation of the vendetta that reared its ugly head last spring.

Hon. Mr. McDonald: The allegations the Member is referring to were whipped into a frenzy by Members opposite in this Legislature. The matter was dealt with by me and the senior department officials at the time it occurred last year. I am satisfied that there is no workplace harassment taking place in the Department of Education.

If allegations are going to be pursued by the Members I would like to see a grievance to that effect.

Some Hon. Member: (Inaudible)

Hon. Mr. McDonald: The Member made the allegation today that there was a complete turnover in the administration branch of the Department of Education. I say to the Member that he is wrong. I say that not only are his facts wrong, but so is his assumption that the reason everybody left was as a result of the management style of one particular person in the department. I know he is wrong, but I know at the same time that the Member is not capable of withdrawing remarks that he knows are untrue.

Mr. Phelps: Can the Minister tell us why the three job positions at career services were reclassified, some to lower classifications and some higher, concurrent with the planned move and decentralization of that shop?

Hon. Mr. McDonald: For the service to be decentralized meant there would not be a single office in rural Yukon that had job descriptions that were the same as before. There is only one job in each office, and that one job had to handle the functions of a career services centre. Consequently, the person filling the position must be capable of handling a full range of services that we intend to offer through the career services centre. We could no longer have the luxury - if we are to open three offices, one in Mayo, one in Watson Lake and one in Haines Junction - of having discrete jobs doing specialized services out of one office. We had to have positions capable of broader responsibility. That was the reason for the reclassification.

Question re: Decentralization

Mr. Phelps: What we have here is a situation where three people are being singled out. They are being asked to move. Their jobs have been reclassified. They have been offered alternate employment but no job description for the alternate employment. They are now asked to make up their minds by November 30 about moving out of town and to make up their minds about the other job offers for which there is no classification and no job description by December 14.

How can the Minister stand there and say these people are not being subjected to unfair treatment by his department and by his senior official?

Hon. Mr. McDonald: The decentralization policy that was announced by the Premier was not a decentralization policy for the operations of career services alone. The policy affected no less than 100 positions in this government: 39 for next year, of which some are currently staffed. Consequently, to make the allegation that people in career services are being singled out is factually wrong and objectionable, to boot.

With respect to the job descriptions being provided, I have been told that the people have been presented with job descriptions. I will carefully check the Member’s allegation that they have had no job descriptions presented to them. If the Member is not telling the truth, I will be back here tomorrow with the information to set the Member straight.

Mr. Phelps: We also have a situation where these people were notified by letter yesterday about the closure of the office. The service will be shut down on January 11. In the meantime, and prior to that, they have been forced to start moving. There are packing boxes all over the storefront office they occupy right now. Some other outfit is moving in.

Can the Minister say this is a proper way to handle employee relations?

Hon. Mr. McDonald: The service is not being shut down. The fact that it is moving to Mayo does not mean it is being shut down. The fact that people are actually going to be living and working in Mayo does not mean that it is somehow less of a service. Mayo is a community of the territory, too. So is Watson Lake and so is Haines Junction.

The Members continually make allegations that, somehow, because the service is being decentralized, it is somehow becoming less of a service.

Speaker: Order please.

Some Hon. Member: (Inaudible)

Hon. Mr. McDonald: The Member for Porter Creek East ...

Speaker: Order please. Would the Minister please conclude his answer.

Hon. Mr. McDonald: The employees of the department of advanced education, career services branch, are being treated the same as every other employee under the decentralization policy. The members of that branch have been given every consideration due them under the policy, and the policy is a generous one.

The employees of advanced education, of all the Department of Education, and of all the departments of this government will be treated fairly in the future, and ...

Speaker: Order please. Will the Member please conclude his answer.

Hon. Mr. McDonald: ... are being treated fairly now.

Mr. Phelps: Does the Minister really think that it is realistic and fair to demand that these people make up their minds about moving their families and their homes away from Whitehorse without knowing what jobs are being offered, the classification of the jobs being offered and having been told that the classification of the current jobs were being changed? Does he really think that is fair?

Hon. Mr. McDonald: The information the Member has provided is at variance with mine. The Member has suggested that the affected employees in advanced education, career services branch, have been provided alternatives with absolutely no job description. I have been told exactly the contrary. Consequently, I am not prepared to accept the assumptions the Member is making at this time. I will check that information this afternoon and report back to the Legislature tomorrow. If the Member is correct, I will deal with the information appropriately. If the Member is incorrect, I will let the Member know.

Question re: Decentralization

Mr. Devries: I also have a question for the Minister responsible for decentralization. I received a very angry phone call a few days ago from a small business contractor in southern Yukon. Decentralization will move a government position to this community thereby eliminating a private sector employee who does the work by contract presently. The question is: what does this community gain by decentralization?

Hon. Mr. Penikett: I do not know that I can respond very well to the Member’s question unless he identifies the position and the community. The purpose of decentralization is to give rural communities a fairer share of government positions and, therefore, government spending than they now have. Therefore, the intention is that, in respect of the communities that are the beneficiaries of this policy, which ultimately would be all rural communities, there will be a net gain in terms of not only public spending but economic activity in their community.

Mr. Devries: So the Government Leader is saying that the government’s policy is to replace private sector employees with government positions and that this is to the benefit to the rural communities?

Hon. Mr. Penikett: No, that is not what I said at all. Obviously, the Member was not listening. The Member has not yet told me what specific position he is talking about. He is suggesting that somehow some private sector activity is being replaced by the positioning of someone from the public service in that community. Unless he is prepared to say in Question Period exactly what he is talking about I cannot respond to his allegation, but, in any case, he has just made a wrong, incomplete or false statement of government policy.

Mr. Devries: I will be a little bit more specific. The communities involved are both Teslin and Watson Lake. The positions are the electrician for Watson Lake and a maintenance person for Teslin. Did the Minister ask the department to do any studies to ensure that the decentralization would not displace or conflict with existing services already supplied by the private sector?

Hon. Mr. Byblow: I have some familiarity with the issue the Member is raising in respect of Watson Lake. The issue is about a staff employee being transferred from Beaver Creek to Watson Lake and requiring staff housing. It has nothing to do with decentralization that a current staff unit in Watson Lake being occupied by a private sector tenant is required for staff housing. Decentralization is not affecting the particular case in Watson Lake that the Member is alluding to.

Question re: Decentralization

Mr. Devries: I believe there is confusion. I am talking about the electrician’s position that is to be moved to Watson Lake. I do not have the book with me but it said a government electrician was being moved to Watson Lake and we presently have an electrician in Watson Lake who does many of these jobs on a subcontract basis. It means that he will have to lay off an employee. That is what I am talking about.

Hon. Mr. Penikett: The fact that we are moving an electrician to Watson Lake is probably a result of the belief by the department for whom the person works that we have need and sufficient work in that community for our electrician. Now, without having a close look at the numbers behind the Member’s allegation, I would be extremely skeptical of his charge that a local electrician is going to have to lay off someone as a result of us locating a person there; I do not believe it.

Mr. Devries: Well, if the present electrician there has enough work for himself and just enough work to keep another person busy, the minute some of this work is taken away from another person, I would say that means he is going to lay that person off. I ask the Minister again: is he planning on replacing private sector workers with government employees?

Hon. Mr. Penikett: The only way that that could possibly be true would be if the only work that person was doing was for the government. I doubt if that is the case. Right now, we are sending electricians from this community, Whitehorse, to communities for much of the work that we require to have done. What we are now talking about doing is locating people in those rural communities. We think that is to the advantage of those communities and as well, we hope, to the employees, because some of the communities we are talking about - many of them - are very attractive places to live.

Question re: Decentralization

Mr. Phelps: I do not want to let this line of questioning go at this point. I would like to know whether or not the departments and the government reviewed the implications of some of these moves on the private sector. Are they simply replacing jobs that exist right now, a government person for a private person, because that is surely not the object of decentralization?

Hon. Mr. Penikett: Of course not. I suspect the Member is setting himself up to confirm his position that the decentralization policy is stupid; those were his words. In a way, he is saying he is opposed to decentralization.

We are talking about the location of people who are already doing work for the public sector, for the government. Right now, we send people from this government out to those communities to do work, electricians among them. The fact that we are going to be locating them in the rural communities, we believe, is to the advantage of the economy and business activity in those communities. It is going to increase the purchasing power of the community; it is going to add to the stability of the community; it is going to enrich the private housing market, perhaps. It is not to displace private sector activity. It is simply the location of people who are within the public sector providing work for this government.

Mr. Phelps: The issue is this. There are people who do work for the government on contract presently in the smaller communities, and some of these people are having their work replaced by a staff person who is being moved out to the communities. That is the issue. They are taking with one hand and giving with the other. It is not of net benefit to the community when they do that. That is the issue. I wanted to know what kind of review had been done to ascertain the implications of each move on the private sector? That is what I would like to know.

Hon. Mr. Penikett: The Member, in his own mouth, is damned as a humbug. He said that private sector people are already losing work from these people being moved out. They have not been moved out yet, so how could they be losing work? In decentralization, we are not talking about displacing the private sector. We are talking about work that is already being done by our people - our people who travel from Whitehorse, in many cases, to the communities to do the work. The Member has repeated so many false accusations, so many wild rumours in this House, on a whole series of issues.

Mr. Phelps: I challenge the hon. Member to name one.

Hon. Mr. Penikett: There is the one he has just made, that private sector people have been displaced from their work by the decentralization policy of this government. That is nonsense, because the people have not been located out there yet.

Mr. Phelps: That is so childish and immature that it does not deserve a response.

The concern is pretty clear. I would like to know how awarding a $50,000 contract to a helicopter firm in Whitehorse, when the difference between that firm and a firm stationed in Haines Junction is $71, coincides with this government’s famous decentralization policy.

Hon. Mr. Penikett: That has nothing to do with the decentralization policy. In the case of such contracts, the Department of Government Services is the sponsoring department, and I am sure the Minister would be happy to answer that question.

Question re: Takhini Elementary School trailers/investigation

Mrs. Firth: With respect to the awarding of the contract for the Takhini School, yesterday the Minister said in Hansard than an explanatory phone call was made when the contract was awarded, or when discussions were taking place. Who from Government Services was present with Mr. Alwarid when that phone call was made?

Hon. Mr. Byblow: In my recollection of the review of the files, the project manager assigned to that particular contract and job was present. I stand to be corrected, but I believe the person’s name is Gordon deBruyn.

Mrs. Firth: What date was that phone call made on?

Hon. Mr. Byblow: I have to admit that I would have appreciated notice on that specific detail. The entire contract award took place in the latter few days of July and in the first several days of August. So, it was during the period of July 27 to August 4, 1989, that this contract award was made. During that period as well, the tender would have closed, the phone calls in question would have been made, and the contract would have been awarded. I do not know the specific date of the phone call.

Mrs. Firth: I would have thought the Minister would have had this information at his fingertips because they have just launched a thorough investigation into whether there was any wrongdoing. The sequence of events is extremely important. I would like to ask the Minister who was present and on what date was Travco called? Was it the same people? The Minister alluded that Travco was also called.

Hon. Mr. Byblow: I cannot respond to that specific detail. I can assure the Member that it took place in that window of time between July 27 and August 4. I can give the Member further reassurance that I will come back with the information as to when the calls were made and the specific details of time and place in writing and provide it to the House.

Question re: Takhini Elementary School trailers/investigation

Mrs. Firth: Obviously the deputy minister has better information than the Minister because he said the phone call took place on August 2.

There is a big outrage now because I should not be asking a question on this. We asked the government to launch an investigation into irregularities. The Minister came back to the House and told us that everything had proceeded accordingly and that no rules had been broken. Yet, a day later, he cannot even tell us about the sequence of events. They are so busy trying to cover their tracks that they do not even...

Speaker: Order please. Will the Member please get to the question.

Mrs. Firth: ...remember what happened.

I would like to ask the Minister when the contract was signed for this project. It is a simple question.

Hon. Mr. Byblow: If the Member had given me notice this morning that she was going to asking for the specific dates, I would have had them available. The Member is correct that, over the weekend and on the strength of her allegations, we reviewed the files, communicated with officials involved and addressed the allegations. We were able to determine there were no breaches of contract regulations for the awarding of purchase contracts.

On the sequence of events, they were in order. The contract closed, exploratory phone calls were made with respect to the timing of the bids because of the urgency of the facility. The buildings were supposed to be in place for September 1. Government Services was present at the time of the explorations. The contract was subsequently awarded. I will be quite prepared to table for the Member the specific dates and times of that sequence.

Mrs. Firth: Atco was the high bidder in this instance. Travco was the low bidder. The Minister talks about a level playing field. I would like to ask him whether Atco and Travco each had an equal opportunity to re-bid on the extras.

Hon. Mr. Byblow: Let us get something straight on the record. The Member is challenging the integrity of the tendering system. Integrity means fairness. One of the underlying principles that I investigated was the fairness of this award. It was clear to me that the same information that was discussed with Atco - relative to bringing those portables into the Yukon in time for September 1, and at what additional cost - would be relayed to Travco, and was relayed to Travco. Indeed, Travco was the lower bidder by a couple of thousand dollars.

Both contractors were treated fairly. That was the bottom line of what I wanted to determine. Following the review, I felt comfortable that fairness was applied.

Mrs. Firth: Travco said it was not provided an opportunity to provide improved delivery for extra dollars, as Atco was. Why not?

Hon. Mr. Byblow: Let us again get something correct on the record. The urgency of the situation was dictated by the need for the community to have those classrooms in place for September 1; it was dictated by the overcrowding conditions at Takhini School; it dictated that Government Services had to explore the nature of the bids in terms of the ability of the bidders to come in with a project by September 1. The same opportunity that was given to Atco was also given to Travco, in terms of offering to them the opportunity to bring the units in by September 1, at the cost to this government.

Question re: Porter Creek/new elementary school

Mr. Nordling: A number of parents in Porter Creek are uncomfortable with the options paper that was provided, with respect to construction of new school facilities in Porter Creek. Their impression is that the department has not done its homework, and that the survey done was limited to Catholic parents, parents with children in Christ the King Elementary, and children within walking distance of Wann and Basswood. The options presented are very limited, with a great pressure being put on to make an immediate choice. Apparently, a Catholic school alone would not meet the need. However, a K to Grade 6 Catholic school is included in every option. Could the Minister of Education tell us exactly what commitment he has made to the Catholic community with respect to a Catholic school in Porter Creek?

Hon. Mr. McDonald: The Member has a hard time getting the whole story out in one question, yet there are so many different surveys and option papers detailed in the preamble I would ask you, Mr. Speaker, to allow me to sort things out.

In 1987, the Government of Yukon released a school facilities study report that indicated that over the next few years the Government of Yukon would provide for another Catholic school in the City of Whitehorse. That is the commitment that is on the record, and it was a report that I tabled in this House. Following that, the department, along with the Catholic school committees, worked up the terms of reference for a survey of Catholic residents and a survey of those residents in the area surrounding an existing school reserve in Porter Creek to determine the potential use...

Speaker: Order please. Would the Minister please conclude his answer.

Hon. Mr. McDonald: ...of a Catholic school. If the Member for Porter Creek West would like to ask another question, I will continue with the story.

Mr. Nordling: To allow the Minister to continue, I will ask the same exact question again. My preamble was only for background; I was not requesting an answer. My question is: what commitment has the Minister made to the Catholic community with respect to the building of a Catholic school in Porter Creek? Is there a commitment to do that or is there not?

Hon. Mr. McDonald: There is a commitment to build a Catholic school in Porter Creek or Catholic school space in Porter Creek. Let me respond to some of the other points the Member made in respect to the options paper.

The lack of civility by Members opposite is absolutely remarkable.

The options paper itself was meant to provide clear options to the public and  to provide them with some sense of what some of the options cost. It was not meant to be an exclusive list. The options paper itself will be presented to parents...

Speaker: Order please. Would the Minister please conclude his answer.

Hon. Mr. McDonald: I believe the option paper is to be presented to parents on Thursday night to get their input as to what they wish to see happen in Porter Creek.

Mr. Nordling: The concern the parents feel is that making a decision based on the information given in that options paper is not comprehensive or complete. They have not seen the other information that the Minister has and time pressure seems to be the critical factor in making this decision. I am not comfortable, myself, in recommending a decision...

Speaker: Order please. Will the Member please get to the supplementary question.

Mr. Nordling: ...based on what is on that options paper. I would like to ask the Minister if he, himself, is comfortable making such a major decision under these time pressures with the information that is available to the parents?

Hon. Mr. McDonald: We have probably gone a greater distance to consult with parents about this school than we did even for the South Highway School, which, in and of itself, was a record amount of consultation for a project such as this.

Time pressure is a bit of factor here because there are pressures being felt by both Christ the King Elementary School, in terms of overcrowding, and there are pressures being felt by Jack Hulland School, in terms if overcrowding. We have provided a temporary measure, by way of portables for Jack Hulland School, with the commitment that we would have permanent space available by September of 1992. So, clearly, depending on what we build and how we build, there are time pressures that we must face.

The public at the meeting on Thursday night will be asked to respond to not only the options paper but to provide their own thoughts with respect to the school. The department will take that input, digest it, and then we will proceed to the next step.

Question re: Hospital employee layoffs

Ms. Hayden: My question is for the Minister of Health and Human Resources.

I recently received information that two federal employees, members of the Public Service Alliance, working at the hospital, have received layoff notices. It is my understanding that, according to the guidelines for federal program transfers to the Yukon - and I quote - “once negotiations on the transfer of a program have commenced with the territorial government and a date for transfer established, the federal government shall not diminish the resources dedicated to such a program before the established date of transfer without prior consultation with the territorial government.”

My question for the Minister is as follows: is the recent action to lay off the two hospital employees not in violation of the guidelines set up for the program transfers?

Hon. Mr. Penikett: I thank the Member for the question. Yes, I can confirm the information that at least two employees of the federal hospital have been given a layoff notice. I can also confirm to the Member that there is an agreement, signed between me and the Hon. Bill McKnight, on behalf of the Department of Indian and Northern Affairs, that while negotiations are proceeding on a transfer, there shall not be any reduction in services, any layoffs, or any cutbacks. It is our view that this reduction in staffing at the hospital is in violation of that agreement. It would be anyway, even if there had been consultation, but there was not.

Ms. Hayden: If this is truly the case that the guidelines have been violated, can the Minister tell me if any action is being taken by the territorial government in response to that violation?

Hon. Mr. Penikett: There has been a problem in the past in that, even though the Department of Indian and Northern Affairs has believed that it was the gatekeeper on devolution for the north, that it would coordinate all transfer negotiations, that from time-to-time other federal departments have not felt bound by the agreements made by the Department of Indian and Northern Affairs. Nonetheless, we feel that the agreement made by the DIAND Minister and myself is binding on the federal government and we, therefore, have already communicated to the Department of National Health and Welfare, in the strongest terms, our feelings that this layoff is contrary to our agreement with them.

Question re: Destination Yukon

Mr. Phillips: I have a question for Minister of Tourism. Destination Yukon is a major undertaking by the Department of Tourism in marketing Yukon as a primary destination. Hundreds of thousands of dollars are being spent promoting this program. On October 29, I sent a letter to the Minister asking for a breakdown of all costs related to the project. Specifically, I requested up-to-date copies of all contracts relating to the recently launched Destination Yukon program. I also requested a list of bidders, prices, name and amount of the successful bidder and if contracts were tendered by invitation bid only. I would like a list of companies and/or individuals invited to submit bids or proposals. This request is over a month old and I have not received a reply. Does the Minister have the information I requested last month here today and, if not, when can I expect a prompt reply?

Hon. Mr. Webster: I do not have the information that the Member has requested with me today but I can assure him that it is being prepared by the department and should be ready in the near future - certainly before Tourism is debated in the mains.

Mr. Phillips: That is wonderful; that is only two months to get a reply to a letter on a very important program. The Minister told us yesterday that a Vancouver firm received the total contract because the proposals requested from two local firms were inadequate. Can the Minister correct the record and confirm for this House that one firm was only given four days’ notice to prepare for this massive contract and the other local firm was not even asked for a proposal for the complete Destination Yukon package and that is contrary to what the Minister told us in this House, yesterday.

Hon. Mr. Webster: I want to correct the record; he has not been waiting over two months for a reply to his request that was made in October. I can assure him that I will supply that additional information he has requested.

Mr. Phillips: This is a very significant contract involving several hundred thousand dollars. I would like to ask the Minister to table any documents, letters or memos that this government sent to the two local bidders requesting proposals on the total contract for Destination Yukon, along with the date the bid closed.

Hon. Mr. Webster: I have already given the Member assurances that the information will be provided.

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


Notice of Business

Mr. Phillips: Pursuant to the provisions of Standing Order No. 14.1(1), I request the unanimous consent of the House to call the following motions: Motion No. 6, Motion No. 11, Motion No. 21, Motion No. 7, Motion No. 5, for Motions other than Government Motions, when that business is called on Wednesday, November 28, 1990. As well, we will be calling Motion for the Production of Papers No. 2 first that day.

Speaker: Is there unanimous consent?

All Hon. Members: Agreed.

Speaker:  Unanimous consent has been granted.

Hon. Mr. McDonald: I appreciate that you have been listening to screaming all afternoon, so anything less than two decibels does not register.

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

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

Motion agreed to

Speaker leaves the Chair


Chair: I will now call Committee of the Whole to order. We will take a short recess.


Chair: I call Committee back to order.

Bill No. 16 - First Appropriation Act, 1991-92  - continued

Chair: We will continue with general debate.

Mr. Phelps: The Minister concluded his answer just before we broke last night. It was a rather short answer.

We were discussing lapses. I am concerned about the issue for several reasons, not the least of these is that we know as surely as night follows day that there is going to be a significant lapse on the capital side between the forecast we get and year-end. Unfortunately, what is happening is that we are comparing in our budget materials forecasts with estimates. It is unfortunate because you may have a false picture of what the actual expenditure comparison ought to be. By way of example, on page 6 of the budget the expenditures under the forecast is $371 million and is compared with the understated expenditures of $356 million. It is my view that this is a knowingly misleading comparison. I wonder what the Minister’s views are on that.

Hon. Mr. McDonald: This is basically a repeat of the conversation we had in supplementary estimates, and I recall agreeing with the Member that the problem with lapses is something that will ultimately be resolved over time but something we are facing now. It is not something that we should encourage if we can help it. The problem with lapses has been going on for some time. I did check back and even in the late 1970s and early 1980s, there were quite significant lapses as a percentage of the total budget even back then. This is a check I did after reviewing the issue with the Member before. Nevertheless, the dollar size of the lapse increased when the capital budgets were first expanded dramatically in 1985 and 1986. The problem has been that on certain projects the time lines that were originally established during the budgeting process, and even prior to that in the departmental planning process, could not be respected for a variety of reasons, including consultation with the public on the kind, size, shape and extent of the capital project itself. I used a number of examples, I believe, to illustrate how that can occur.

We have in the past, as well, reported drawn comparisons between main estimates and main estimates and compared forecast to main estimates in determining comparisons, and that certainly is not something new: that is, too, a long-time practice. But I suppose the biggest issue is the extent of the lapses and the need to fill the capital plan on the originally intended schedule. As I indicated before, the only and the best explanation can be given on a project-by-project basis because it is very difficult to respond generally, given that there are different reasons for different lapses taking place.

Mr. Phelps: I want to get away from the sort of esoteric concept of lapses as sort of something cute and get down to the nitty gritty with regard to it. There are a number of problems. First, what we have is in effect a false comparison of spending from one year to the next. By the time the main estimates come along it becomes glaringly obvious, and particularly when the so-called surplus is going to be spent because of, in the case of this particular budget, the RCMP contract renegotiation and the union negotiations on the collective agreement. It seems to me that the government has a pretty good handle on exactly how much those three items will add to the expenditure column in the budget.

That is one problem and we have discussed that. The other problem is that when one looks at it community by community, at a set of expenditures in the capital budget, the government takes the position that a community is getting a fair share because it is getting a comparable amount of the total capital budget as are other similar communities.

So that on the one hand is stated by the government. When you have a situation though where a community is promised a large project, such as Carcross with the water intake system, valued at $600,000 in the budget two years running before delivery, what that means is that they have gone for two years being shortchanged by a total of $1.2 million that had been voted for them.

At the same time and at the beginning of this charade, the community is told they cannot have money to spend on a much needed curling facility because money is being spent on the water system. The impression is very definitely given that the lapses can be used in a way that gives certain communities the short shrift. I say the same thing with regard to Tagish. These are accusations that emanate from residents in the areas. The reason the lapses take place is that the government is trying to save money, and trying to save money at the expense of the communities that are, in effect, being penalized.

I want to go over that again. It is assumed that Carcross is getting a fair share of the capital pie. About $600,000 in two consecutive years is not spent. It is not allowed to have another kind of expenditure because, it said, they already received their fair share of the pie. At the end of two years they had been shortchanged $1.2 million. They do not have a curling club. Nor do they have the water system. I feel it is unfortunate because what comes out at the end of the process is a situation where some residents feel they have been given short shrift and they wonder whether or not there is some intention on the part of the government with regard to that short shrift.

Hon. Mr. McDonald: I am glad the Member limited his remarks there because there is so much to respond to.

It is important to point out from the outset that the community allocation is a factor in terms of the distribution of capital funds. It is certainly not the only factor. There have been years, for example, I can recall myself having been in Education, where the community of Carcross received tremendous resources, extensions to the school and various other community projects, and the community itself compared extraordinarily favourably with other communities, because there was a demonstrated need in that community to do certain things.

Even though some projects do lapse, invariably the same projects are revoted. In almost all cases, the project is fulfilled by the government, at some point, when the consultations are complete and the technical work is finished. For example, in a community-by-community breakdown, community X can be shown as receiving Y dollars for the year 1991-92, and may receive far more than that because they are receiving the revote funds from the previous year for projects that were not undertaken then, but were finally undertaken the following year because the consultation and technical work was complete.

We do not work revotes into community-by-community allocations, because we have already announced that a community is going to be receiving so much attention from the Legislature and the main estimates capital budget. We do not have a revised community-by-community estimate to double count projects, that have already been counted in the community-by-community summary.

The lapses the Member is referring to are not lapses that are being experienced on the operation and maintenance side. As I explained last night, the amount of lapses, as a percentage of the budget, was very small for this government. I even mentioned one of my own departments, because I know it in detail. The Department of Education lapsed around $80,000 on a $55 million budget, which is very close budgeting: dangerously close, in some respects, if the objective is not to over spend the vote.

I agreed with the Member that there are significant capital revotes. The Member can put himself in my place for a moment. I can assure the Member that it is undesirable, from the government side, to have to show a projected deficit for the sake of revotes, which is what we did in supplementaries, when we know full well that past history has shown that, every year in supplementaries, we show a deficit and, every year, in the end, we show a surplus, with the exception of the one year where money was granted to the Yukon Development Corporation and the Yukon Energy Corporation.

That effectively gives the public the impression that the government is planning a $20 million deficit and is prepared to accept that as a normal course of events. If the public was not watching carefully, it would be under the impression that we have been running deficits every year since we got into office when, in fact, the opposite is true. It is not exactly in our best interest to run the revotes because of the obvious problem that we face as a result of the exercise.

The Member will also notice that the revoted projects show up in every community. I can assure him that Carcross is not being singled out for the sake of revotes, and there are projects facing similar circumstances in all communities over the last five years; it is not a desirable thing to have the projects lapse. It is an even more undesirable thing to ram the project through when the technical work is not complete and the consultation is not complete. When we choose between two alternatives, as much as we dislike them, we choose the one that favours better planning. Some of the projects that the Member refers to clearly cannot be delivered simply for the fact that the capital budget is voted in the fall and the projects are supposed to start up April 1. In many cases the planning and consultation take a lot longer than that.

You heard in Question Period today about Catholic schools and about planning for a Catholic school in Whitehorse. Clearly, this has the potential of being a classic example of the Legislature voting money in last year’s supplementary to start the planning for a Catholic school. There has been planning of various sorts from surveys being done, consultation with school committees, et cetera, yet we are close to the time when we should be considering a final design and tendering. The project is considered to be an open book in some people’s minds. There is, as the Member for Porter Creek West pointed out, still a feeling that we should start at first principles in some people’s minds.

Clearly, it is difficult to sometimes steer those projects through, as much as we, in this Legislature, would like to see the projects completed.

The government does not save money by lapsing projects because a revote is not a revote unless the money lapses and is not used for any other purpose. If it is used for another purpose, the money is not there to be revoted. Consequently, there is no money saved as a result of having the revote there. If the Member would simply put himself in our position for a second, he would understand quite clearly that this is not something we enjoy doing. Voting and debating five or six different times for the same project is not something that warms my heart. I would prefer to debate the project once, have the project carry forward and be successfully completed. Debating it in supplementaries and having it go through the revote process causes the project to carry on through future years and be debated more and more. Debating the same project over and over is not something this side finds desirable.

I think the Member must appreciate our perspective. It is far from the case that the revotes are considered by our side to be an intentional tool for some ulterior motive other than fulfilling our commitments under the capital budget.

Mr. Phelps: With respect to the Member’s assertions about having to show a deficit when they know there will not be one, I can well appreciate that. But, it still seems to me that perhaps the forecasting can be adjusted to more accurately reflect what will transpire. It is not a very good forecast when you know the capital budget will be out by 22 or 23 percent. It paints a false picture. Surely the government can do a better job of forecasting some of these capital projects. It is inexcusable to have this continue.

Even though the percentage may remain the same, we are still talking about much larger amounts of money, because the capital budget has increased so rapidly and that naturally explains part of the problem in spending all that money, given the size of Government Services. The planning departments and so on were fine tuned to capital budgets of half that size five or six years ago.

That is one issue. I just think that there has got to be a better job done in regard to forecasting because there does not seem to be any attempt to forecast lapses.

The second point is that the issue with regard to some of the rural communities, and I am using Carcross because I am most familiar with it, is simply that when you have multi-year expenditures forecast, such as the forecast for developing and implementing a water and sewer system, and because that money is supposed to be spent you tell the community just to simply forget about, say, a new community curling club complex, then when you have these lapses and there are a couple of years of, in effect, no money being spent on anything in the community, you simply do not catch up. The way things are going, the new curling facility stands to be put back by an additional two years.

That is a pretty important issue in that particular community where there is very little in the way of recreational facilities in the winter and where this is seen as one of the facilities that is used by all of the community, particularly by all of the kids. So I hope the Minister can understand how the perception develops with regard to the potential for the misuse of the lapsing process.

Hon. Mr. McDonald: I can appreciate the Member’s argument. I can appreciate that if someone who had expectations was let down, they might be of the frame of mind to interpret the process as mischievous, as the Member mentioned: that the government had some grand design to keep a particular community from having its share of capital expenditures. I can only tell the Member that my experience in this Cabinet and in this Legislature as government, I have not witnessed that myself. I have not heard of that taking place. I would think that if an objective observer were to go to various communities and have a look at the actual, not the forecasted or the budgeted planned expenditures in the Legislature, expenditures laid into each community that have taken place, I think any Member would be hard pressed to say that a community had been treated unfairly.

I am afraid I am at a disadvantage when it comes to discussing the Carcross community hall or the Carcross water and sewer services because I have not been in Community and Transportation Services for a couple of years and am simply not aware of recent developments, at least not in the last couple of years.

I have already indicated that I do agree with the Member that forecasting should be better. There, again, it has to be the responsibility of departmental managers to provide better forecasting and whatever consulting advice they receive from engineers and others. I can only say that in the past year there certainly was one project, the arts centre, that had a full $7 million revoted because of the delays that have already been mentioned in this House. That was a rather large project. The entire amount was revoted at that point.

I think the situation will improve, or may improve, if capital budgets get smaller in the future. It certainly is smaller this year than last year. The capacity and experience of the departments to deliver should improve. I cannot offer much more to the Member of a general nature, given that the best explanations for why capital lapses exist can only come from a description of a specific project and an explanation as to why that particular project did not proceed.

Mr. Phelps: I do not want to belabour this for too long, but there are a couple of points I would like to make. First of all, naturally the operation and maintenance forecasting could be more accurate because in the successive supplementary estimates changes are made that are appropriately realistic.

I can recall that most governments toward the end of the year get desperate to spend discretionary money so they will not be penalized in future years because they were not able to spend the money they had allocated to them in the current year. This is something that is well known. One sees it in the federal government and virtually all junior governments. Management says we have to spend this money or we will not be able to get more next year.

I am a little concerned if that may be one of the problems with forecasting the lapses on the capital side. I am concerned that maybe the perception among the departmental managers is that if they say it is going to be impossible to complete a contract, or even to start it in the current fiscal, that will be used against them when it comes to allocating future years’ capital budgets among the various departments.

I am not saying this is the case, but it appears to me that virtually no attempt has been made by the administration to reflect reality in the capital forecasts.

Is the government determined to ensure that the forecast is more accurate? If lapses are going to continue to occur, that is one problem, but that aside, if we want more accurate forecasting, would it not be a useful suggestion that it be made known that the department will not be penalized in that fashion for not spending all its money in the fiscal year under review?

Hon. Mr. McDonald: We have discussed the desperate measures some managers are reputed to take to spend money at year-end in order to demonstrate that they are in need of the full amount that had been voted to them by this Legislature. In the past, during my term in this Legislature, there have been some celebrated cases where a manager has gone out and, in a spending frenzy, has used up all the funds that are available in the department.

There are some considerations one must apply to this situation to understand how the psychology may be slightly different than one may be prepared to interpret it as.

You must consider that the Financial Administration Act indicates that it is unacceptable to over spend the vote. If the departmental manager is not absolutely clear as to where they stand, in terms of their vote authority and the amount of money they have spent, they are playing a very dangerous game in trying to spend to the limit of the amount that is available to them.

I mentioned this to the Member for Riverdale South during the general debate on supplementaries. There was less of the last-minute spending this year than has taken place in the past. That is my impression, having kept an eye out for it during this last spring.

I think that at the same it is good to point out that, generally speaking, since I have been here, I have not experienced a situation where a department is analyzed immediately following the year for the fact that they experienced lapses in the current year, largely because the main estimates, of course, are determined early. They may ask us, for example, for next year to determine early in the current year, in the existing year. It was the assumption made in those main estimates, certainly, that the manager is required to show the funds that they are being given in this year and will require the same level of funds or increased funds in the following year. So there is no immediate reaction, all in the space of a few months, due to the simple fact that the department has less funding.

They may have vacancies that they could not fill and may feel it inappropriate to spend in other areas simply because they had lapsed some personnel time. We do not make a habit to under spend votes, as a general rule, certainly. It is certainly not true in the case of capital funding because it is almost always the case that the lapsed capital funding comes back to the Legislature for a revote. There is a view that once a capital project is put on the table and passed by the Legislature, there is a public expectation that this capital project should be continued and that our obligations be met.

If Members want to cast their minds back to 1985, this government lived up to virtually all the - certainly in my department - commitments that were made by the previous government because they were publicly made commitments and this obligation was lived up to.

There came a point where the government was still spending those pre-1985 commitments in 1987 and 1988, simply because they were still on the table. So I recognize the point that the Member is making and I would not want to paint a picture that there is never a situation where managers do not spend money at year-end because they think they have to or that the system is so perfectly foolproof that it catches every manager when that happens, but I do believe it happens with less frequency and I believe that it has been stated clearly that one cannot over spend, that the psychology throughout is to not over spend the vote.

The Financial Administration Act states that a manager cannot over spend, and it is against the law for the manager to over spend. Therefore, the psychology will be to under spend. I think that is a problem we will have to address in this House. With the exception of the Legislative Assembly Office, it has only been in this last year that there has been no over spending of any particular vote. Well back into recorded budget history, in the late 1970s, many departments consistently over spent their votes. Under the new Financial Administration Act, they would technically be in violation of the law. That is something we have to address.

I hope I have been able to explain, at least to a certain extent, what the situation is with respect to the general psychology of budgeting.

Mr. Phelps: One of the arguments made is that, because of the planning cycle, when lapses occur, it is too late for them to be taken into the planning of the next year’s budget. This goes against the proposition put forward by the Minister, in that it is all the more reason for people to wait until it lapses and not forecast the lapse ahead of time, because then it might be taken into consideration in the planning cycle. In other words, if it were known now that certain capital projects had no hope of being completed by the end of the year, then it may be that, given appropriate notice, it could be utilized in that way.

I would like to move on to my next point. How accurate will the surplus being spent be? In other words, does the government have knowledge now as to how close the $15,800,000 is going to be to the increased costs arising from the RCMP contract and the public sector collective agreements, which are now very close to being completed?

Hon. Mr. McDonald: As I indicated in my opening remarks, we feel we will be fairly close, only based on experience we have had in the past with respect to supplementary votes. It is a very difficult question to answer, because negotiations for employees and for the RCMP are a calculation of other demands that may be put forward and which we may want to consider, but are not yet determined. We do know that among the demands we are going to have to face are included wage increases for employees, and the RCMP contract. Those are probably the two largest single items. All I can say now is that we do intend to balance the budget, and we must fit the supplementary demands into the amount of funding we have. That is our desire.

Mr. Phelps: The Minister, in his budget address, made much of his calculation that the increase in the transfer payment from Canada under the Formula Financing Agreement, while it was an increase, was not an increase that would match inflation. At the same time, on page 254 and 255 of the budget, we see that the transfer payments, the contributions to the various charitable organizations or social service organizations or family and children’s services organizations, in many cases, have been held to exactly the same amount. For example, on page 253, Yukon Family Services is $168,000 this year and is forecasted at $168,000 for last year. The Child Development Centre is somewhat less. Crossroads is the same this year as for last year, and so on. I am wondering why the Minister would feel that on the one hand he can complain about not receiving an increase that, in his view, quite matches inflation and at the same time can be making payments to these other organizations that do not take into account the issue of inflation at all.

Hon. Mr. Penikett: I think probably it would be best if I took notice of that particular question in connection with the Health and Human Resourses mains. The Member should know that we have in this proposed budget been given finite resources and that those resources are tighter. We ourselves in our operations in Health and Human Resources in terms of the services we provide directly to people will face the same kinds of challenges that we face for these groups.

I would want, when we get into discussion of the mains, the Member to understand some context, though. That is, if you look at the funding, the O&M grants and contributions to agencies and organizations by the Department of Health and Human Resources, the sums have over the past couple of years more than doubled. To some extent, of course, the arrangements between us are a matter for some negotiation and I have had conversations with some of the groups already. I hope in the next month to have discussions with others about how we are going to meet the challenge that faces both of us, that of tighter resources.

Mr. Phelps: Certainly the senior Minister recognizes the inconsistency between complaining about a small increase that is not quite enough to meet inflation on the one hand and yet doling out exactly the same amount with nothing for inflation on the other.

Hon. Mr. McDonald: Clearly, this is more of an issue that should be dealt with in Health and Human Resources. I would remind the Member that there are increase and decreases throughout this budget despite the fact that the amount of expenditures that we want to vote are down from last year, and despite the fact that the transfer payment is up only marginally, but still up, from last year.

There are various priorities in the government and there are various reasons for some projects receiving more money and other projects receiving less money, but in many cases one must consider the funding for those projects that may be held at the same level in the context of a multi-year commitment to a particular project. There are explanations in each department as to how they have managed to work with less funding available overall for the government than that one would expect, given the inflation rate, but it is something I think properly can be only dealt with in the departmental votes.

Mr. Phelps: I just think it is incredible that this government would come out and complain very bitterly that while they received an increase, in their view it was not enough to match inflation on the one hand, and yet in its contributions to these independent societies and its contributions with the other hand to those groups for their operation money, to give them nothing, no increase at all, and to hell with inflation. I just think it is a contradiction and I am just wondering how the Minister can explain that.

Hon. Mr. McDonald: The Member insists on debating Health and Human Resources budget at this time and I am not going to rise to the challenge. The Minister responsible for Health and Human Resources, when we get to the Health and Human Resources vote, will respond to the Member’s allegations and I believe has already given the Member a hint of what the Member can expect in terms of an explanation.

We can look throughout the budget to see where there are decreases in expenditures, expenditures that are held at the same rate, and expenditures that are increased. If there is a considerable increase in one area, the Member, in trying to use a general argument, will wonder why the government, which only received a less-than-inflation increase, would have increased this particular project by so much. The answer can be provided by the line Minister as to why the particular program is of a particular priority.

There are a number of reasons that may be available to explain why some projects have a decreased funding level, some held to the same level, and some increased. That can happen in the line department debate, but it cannot happen as a matter of generalization here, because there are projects that are given funding that is above the rate of inflation, there are some things that are given funding at the same rate as inflation, there are some that are given funding at less than the rate of inflation. If the Members take an interest in a particular area, the line Minister will be able to explain why that is the case.

Mr. Phelps: We are not talking about what the line Ministers are spending on their various programs or in their departments. For example, look at page 12. The discretionary grants to another body, the municipalities, has been cut by more than 10 percent. We are talking about other situations where contributions to independent third parties remains the same. We are talking about general debate there. The government is doing this to junior organizations and junior governments, and that is okay. They either have to hold the line or put up with drastic cuts. Yet, he stands there and complains because the government got an increase, but it was not quite enough to meet inflation.

I am suggesting that is inconsistent; it is contradictory. I would like the Minister not to stand there and say they made some cuts in some of their programs and are making advances in another. We are talking about the contributions to a junior government, just as this government gets a huge contribution from the feds, where the junior government or society has to cope with the amount that was given to them to run their affairs, which is less than inflation and sometimes negative, due to a drastic slash.

Hon. Mr. McDonald: I find the point the Member is making quite incredible. It is ludicrous. The Member is essentially saying that the Government of Yukon cannot complain about its overall transfer to the territory from the federal government unless every program we have or every contribution to any other organization gets at least the same level of funding as we received from the federal government. That has never happened before. When has that happened before? The grants we provide for various other agencies is at least the same as, or more than, the amount of money we received from the federal government through the transfer payment. That is exactly what the Member is saying and it is ridiculous.

There are many good reasons why the funding provided to various organizations may be up or down or different from either the rate of inflation or the rate of growth in the transfer payments. Each situation is different.

The municipalities are receiving three percent growth on the O&M side. On the capital side, they are receiving a reduction. In this context, one must understand that, when we took over the government in 1985, we increased transfers in municipalities dramatically from that period so that, even with the cut, the increased amount was still 115 percent more than the municipalities were receiving prior to 1985.

Madam Chair, will the Member please be civil enough to let me speak?

The percentage of the capital budget given to municipalities is more than it was prior to 1985.

There was clear justification for the levels of funding being given some organizations - that being more than, the same as, or less than, inflation. Each has to be decided on its own merit.

The bottom line in terms of general debate discussion is that there had to be an assessment of the needs of all organizations and the establishment of a comparison of priorities among all groups. There had to be a balanced budget.

We have achieved that balance. The details of the various program elements can only be explained by departmental Ministers. No matter how much the Member wants to draw generalizations, I will have to challenge his assumptions because it is patently obvious that one cannot make accurate generalizations based on the information the Member is presenting.

Mr. Phelps: The gentleman believes what is good for the goose is not necessarily good for the gander, I gather. The only group that has not been either held at a zero increase or reduced, it seems, in this budget is the Government of Yukon that has increased its person years by a number of 118.

I would like to move on. I am rather curious as to why nothing was put in the budget to date with regard to improvements to the Whitehorse sewage system. We know the vague estimates that have been bandied about in the media are quite, quite large. We have heard everything from $35 million up to as much as $50 million. Surely, this is an item that ought to be reflected to some degree in the budget. I am wondering why it does not appear there at all.

Hon. Mr. McDonald: The Member will have to forgive me, but I will have to respond to his preliminary remarks, which suggested that the government is simply increasing the bureaucracy, as he would put it, and doing all of this for no good reason I presume, and at the expense of all others who have not achieved an increase equivalent to the rate of growth of the transfer payment. We have added 50-some personnel in the Department of Education, for example - almost half of the 118 person years that the Member scorns as government getting fat on its own excess. I will give him a list, and I would like to know specifically which of the proposals I am putting forward in the main estimates as the Minister of Education, not the Minister of Finance, that the Member objects to, or feels is sufficiently low priority that they should not be put in the budget.

Incidentally, there are 20 teachers in the budget. There are 18.5 native language instructors in the budget. These alone are 40 examples of the government getting fat on itself.

I will ask the Member, or the Member may like to ask the Education critic to explain their views on those personnel increases, because I would be interested in knowing. As Minister of Education, I should know how you specifically feel about my estimates.

This year, we have provided four extra school buses for the City of Whitehorse, responding very clearly to demands by the public to improve busing. Each bus runs at approximately $50,000. That is $200,000, which is a lot of money. As a particular, is that something that the Member feels is, in reality, too low a priority to have been funded? If the Member feels that way, I will take it. I will not agree with him, but I will certainly take the information and find it useful. I will keep it in my memory bank, in case I need the information in the future, in terms of understanding where some Members of the Legislature are coming from. That is only reasonable.

It is important that we discuss the detail of the budget, so that when one makes generalizations, like “all organizations are not getting a fair shake”, or “government is simply growing upon itself”, we can actually assess what it is the Members are saying. They will know what the details are when we go through the detail of the estimates. I would be interested in hearing Members’ comments on that point.

With respect to the estimates in the Department of Community and Transportation Services, I would ask that the Member discuss this with the Minister of Community and Transportation Services at the appropriate time, because he is really the spokesperson for this particular project. It is my understanding that the figures associated with the improvements to the Whitehorse sewage treatment system have not been defined and have not been discussed in detail with the City of Whitehorse or the federal government. Consequently, it would be very difficult to provide even a ball-park figure in our estimates.

The government has indicated that it is prepared to work with the City of Whitehorse and the federal government to provide for sewage treatment facilities for the City of Whitehorse, but a ball-park figure is required. I understand that the Department of Community and Transportation Services is working with the City of Whitehorse and, in fact, is spending monies working with the City of Whitehorse to do the various technical analyses to determine what the potential costs might be. Given the size of the project, once the costs are known there will be sufficient opportunity to put in the necessary technical planning funding for the option chosen and, ultimately, money for construction of the project.

I am sure the Member is aware that it is not necessary to put a dollar in the budget for this particular facility, no more so than we put a dollar in the budget for any other particular municipal water and sewer project. If funding is required for this year, it will show up in a supplementary.

Mr. Phelps: I am concerned because it is a rather large and obvious potential variable in the expenditure side of the budget. I would like to turn to page 11, the revenue summary. The total revenue excludes Yukon Development Corporation interestingly enough. I am curious about a couple of items here. It is anticipated from the forecast that fines are going up from $201,000 by 53 percent to $307,000. I am wondering if there is any special reason for that large change in the budget?

Hon. Mr. McDonald: I will have the matter checked and I will try to provide an answer for the Member. While we are waiting, I would not want the opportunity to go by in general debate to discuss the Member’s chart on the Yukon dependency on the federal government, because the Member did take the trouble to put together what he considered to be a more accurate version of the government’s dependency. He provided me with an analysis, entitled Budget Analysis, in a manner that he considers to be a more fair or more accurate version of the government’s dependency relationship based on recoveries from Canada - the relationship of the money the Yukon government receives for itself versus the money it receives from the Government of Canada. The Member went so far as to provide a bar chart, I am afraid I do not have that any more but I think he provided it, that showed the dependency relationship was increasing dramatically over previous years; that, I found surprising. I do have it. It shows from 1984-85, the last year that the territorial Progressive Conservatives were in office, to 1991-92, the dependency upon the federal government increasing dramatically from 78 to 84 percent.

I was surprised to see those figures because I was not operating under that impression at all. I asked that a thorough analysis be done to determine if the Member was correct. An analysis was done and the Member was incorrect, although I thank him for his efforts.

I think it would not be appropriate to calculate in 1984-85 because the increase in the transfer payment from the federal government took place then. Consequently, if one were to factor in the increase in the transfer payment at that time, in that one year it increases the dependency quotient, if we can call it that, on the federal government dramatically.

I do not think the Member really wants to take credit for that, even though he is constantly taking pride in and credit for the fact that negotiations had increased the transfer payments to the territorial government. What that would mean, based on the information I can provide, is that the dependency on the federal government increased dramatically the last year the Conservatives were in office and has declined every year since then. I doubt that is the intended effect of what the Member was trying to propose. I doubt he wants to take credit for something like that.

It is more appropriate to compare from when we took office to the point at which we are now. That shows the record of the government in attempting to become less dependent on the federal government.

The Member, in his opening remarks, made it clear that it was inappropriate to include Yukon Housing Corporation revenues and recoveries in the calculation of the total revenue flow. For some mysterious reason, he has incorporated Yukon Housing Corporation recoveries in the final two years for comparison.

Maybe the Member is not aware of this, but in the final two years the Member has included the Yukon Housing Corporation recoveries in his calculations. I think it is important that we provide the same information consistently throughout and I intend to do this now. One of the factors that....

Chair: There is a point of order.

Mr. Phelps: I think the Member misspoke himself there. If he looked at page 11 he would see the revenues do not include the Yukon Development Corporation.

Chair: There is no point of order.

Hon. Mr. McDonald: There is a difference of opinion - not a point of order but certainly a difference of opinion - with respect to the recoveries in that it is our view that certainly the figures shown in the 1990-91 budget estimate and the figure in the 1991-92 budget estimate do incorporate the Yukon Housing Corporation recoveries.

I think the Member should also be aware that it would be a mistake to assume that every single recovery that this government receives comes from the federal government. This will certainly come as a surprise to communities that are paying interest on their loans or individuals who purchase something as minor as materials at government auctions, or students who pay course fees at the college, or a host of others who pay recovery fees to YTG.

It is also important to note that the Yukon Liquor Corporation now pays for its own capital expenditures. This has the effect of reducing the net profit it turns over to this government. This change occurred in 1989-90 so that to put our charts on a comparable basis we have added this capital back into the territorial revenue and total revenue for the period of 1989-90 and 1991-92.

The Member has also made the assumption that devolution to us of programs previously operated directly by the federal government increases our dependency upon Canada. I can only ask the question: how can that be if the federal government was previously operating a program for the benefit of the territory?

How can a change in the way it is being paid for increase the Yukon government’s dependency? The argument can be made that, if there is a health transfer to this government, are we to interpret that as increasing dependence on the federal government, if the federal government is currently paying for that service now? For example, how could the transfer of the fisheries and mine safety programs, which were previously operated by the federal government without our involvement, and which have been the responsibility of YTG since 1985-86, be counted as having increased our dependency upon the federal government?

It is important that the chart be adjusted for the base funding for these programs. We would not make an adjustment with respect to territorial roads and airports. Those were programs we received through contract funding, and they would be shown as a recovery anyway, whether they show up in the transfer payment or in the recovery: essentially, it makes no difference.

I have a new chart that reflects all the things the Member has mentioned. It reflects the things I have mentioned as being important in order to provide an apples-to-apples comparison. I will pass the chart out.

As we wait for the chart to be handed out, I would like to give Members notice that I will check on the question put forward by the Member for Hootalinqua, with respect to the information in the budget book. I am fairly certain that the explanation can be found in the Justice estimates. I will have to take notice of the question and get a reasonable explanation that will satisfy the Member.

According to the calculations and including all information, our total dependency has decreased since 1985-86, and that is 78.6 percent versus 77.7 percent projected for 1991-92. This decline is even greater if a comparison from 1985-86 is made to the last year for which we have actual figures, which is 1989-90. As per usual, it is quite possible that we will receive additional adjustments to the income tax revenues because of the way the tax revenues are calculated and remitted back to us.

I will draw your attention to the last two columns. I have factored them separately, but I felt it was important to take into account that this is the Young Offenders Act, and our responsibilities were received from a federal piece of legislation. Because we were expending money and getting recoveries from the Government of Canada to fulfill obligations under the Young Offenders Act, it would be unfair to insist that this is increasing dependency on federal financial coffers.

Nevertheless, the reason I factored it out, is that that happens to be my opinion. It may not be shared by everybody, but certainly is held by me.

It is more appropriate to compare our dependency quotient, so to speak, on the basis of funding received through the federal transfer payments, even though I believe that we have conclusively shown that even if one takes into account gross expenditures by the federal government to Yukon government, a decreasing dependency is demonstrated. I still believe that it is most appropriate to consider the dependency quotient on the basis of the transfer payment alone, because that is discretionary funding that the Government of Yukon receives.

The other funding, of course, can decline or rise as per contractual arrangements with the Yukon government at any time. That is more a matter of  federal will than it is of our desire to receive the funds. This is done at the same time, when there has been a net reduction in the tax rates since 1985, which obviously makes it more difficult to show a reduction in dependency than might otherwise be shown. I believe that the Member will have to admit, unless the Member wants some time to study the figures, too, that the dependency has decreased even according to the Member’s own analysis.

Now the Member is referring to this as voodoo economics, and I find that most distressing because the Member, at least up until the time he just uttered the words, had at least some respect in certain circles for being one to take the trouble to understand the issues involved. That may be an exaggeration of the Member’s capacity to understand what he is speaking about.

Mr. Phelps: I was waiting for the answer to my question that had to do with the fines going up by 53 percent.

Hon. Mr. McDonald: I explained while the chart was being passed out that I could not provide that information to the Member now, but that I would come back with the information later.

Mr. Phelps: The chart just goes to show what can be done with figures. If one compares 1985-86 - I know there are no figures for 1984-85 - with 1991-92, there is not very much change in the percentages at all. We have gone up and down by perhaps one percent, 1.1 percent.

My next question arising from page 11 has to do with investment income. I am wondering why that was forecasted to drop by 14 percent. Can the Minister advise us if it is because of a change in interest rates alone or because of the change in how and when the government receives money that it can invest.

Hon. Mr. McDonald: There are two things that would affect this. Certainly, the interest rates are the major cause. Secondly, the cash balance is expected to be less than it was last year, and consequently that would be another element.

Just to quickly return ever so briefly to the dependency quotients - because I regard this as challenge, an intellectual challenge if nothing else - that the Member has put forward, I do want to once again briefly defend why we have not incorporated 1984-85 into the chart. I think the reason quite simply is that the transfer payment increased dramatically at that period.

As I said before, it is most appropriate to compare the years that we were in office, and not the years the Member was in office. If the Member wants to insist that we use the year 1984-85 then, obviously, that year would show a massive increase and dependence upon the federal government. I do not think the Member really wants to take responsibility for what would otherwise be good news, which is an increase in the transfer payment, and which also translates into a massive increase in dependence on the federal government. For the sake of comparisons, to relieve the Member opposite but, also, to provide an appropriate comparison while this government is in office, it is most appropriate to start from the base year 1985-86, when we moved to the government side.

Mr. Phelps: I thank the Member for his selective argument.

At this point, I was going to ask about the fuel oil tax, which I see is anticipated to increase by three percent, and whether or not this government has any intention of broadening the scope of exemptions for those who have to pay a highway tax on fuel. You will recall that the fuel tax was removed from certain off-highway equipment, particularly for the mining sector, and some farm machinery. We had raised in the past that we felt we also ought to follow the example of some of the provinces, including B.C., where purple gas, I guess it is called, can be purchased for operating off-highway vehicles and boats. It seems to me to be rather unfair to expect those who spend a rather large amount of money on gas or diesel to power their recreational vehicles, such as boats and all-terrain vehicles, to pay a highway tax for that privilege.

It seems to me this government should have a look at what some of the provinces do. I know for a fact that one can buy purple gas in British Columbia for use in one’s boat. It represents a considerable saving for people who are using it for a purpose that does not involve a vehicle being run on the highway.

Hon. Mr. McDonald: I thank the Member for the representation he has made. It has been made in this Legislature before and by various individuals who would like to see a tax exemption for fuel purchased for marine transportation. There is no short answer to this. I will do my best.

The government, in the last few years, as I explained, has obviously reduced taxes. There has been a net reduction of tax rates to Yukoners since 1985-86. There have been some decreases and increases. Increases have been made to tobacco and liquor and decreases have been made to YCIP premiums and ambulance fees and the off-road fuel tax. As nice as those things are, they have caught the attention of the federal government that feels that this is inappropriate, even though it is, in effect, a tax expenditure.

They have keyed into this element of our financial planning in the context of the federal formula financing negotiations. Their biggest thrust this past round of negotiations has been to criticize the overall level of taxes that Yukoners pay and express concern to the point that they are prepared to impose penalties if we intend to show any further tax rate reduction of any sort to Yukoners.

In the first instance, it is obviously going to make it difficult to reduce our dependency upon the federal government, through economic development initiatives, because as the territorial income increases, the federal grant decreases by a rate of $1.40 for every dollar in revenue that we receive. So, clearly, our dependency quotient is going to be more difficult to improve with the formula, but the fact remains that the federal government is concerned about our tax rates overall. They are not insisting that we inflict any particular tax on the Yukon; they just feel that the overall burden on the territory is insufficient and that we should do something to rectify that.

The only way that we could do away with what we consider to be the perverse element in the formula, is to raise our taxes by 40 percent, at which time we would then return to the dollar-for-dollar trade when we have volume increases in our revenue. I would think that to expand the tax-exempt status to marine vehicles at this time would be considered a very provocative measure while the negotiations are ongoing, given the federal government’s interest in our tax rates. It is certainly well taken care of in the formula that we expect we will have to sign shortly, in terms of the provision to penalize us, if we receive less taxes than we do currently.

I think we are at a stage where we should be considering holding our tax rates, dealing with the federal government with respect to the formula, and considering at future times whether or not any tax measures can be employed to improve the situation for certain classes of Yukoners who may or may not require tax relief.

I have heard the Member, and I appreciate the arguments, which I have heard before. There may be an opportunity to deal with this in the future.

Chair: The Committee of the Whole will have a short recess.


Chair: I will call Committee to order.

Is there any further general debate on the 1991-92 estimates?

Mr. Lang: I would like to direct a question to the Minister. I had asked the Minister of Government Services some questions about the B and C airports and how much had been negotiated for the purpose of the transfer, how much had been spent last year and how much was being spent this year. In a legislative return tabled by the Minister of Government Services, I find that we have a base grant of $1.7 million transferred to us as of this coming year 1991-92, yet we are only spending $1.36 million. There is a $500,000 difference there that was negotiated in good faith with the Government of Canada. These are the parameters and this is what we need to run these programs in order to accept the transfer. Not even within a year, we find $500,000 less is being spent on the program. Was that a conscious decision made by the Minister of Finance in conjunction with the Minister of Government Services knowing they were going to cut out programs of this kind? At the same time we had gone to great lengths in negotiations with the Government of Canada to justify why these dollars were needed in order to maintain these programs?

Hon. Mr. McDonald: This is a subject that is going to have to be addressed by the Minister of Community and Transportation Services. I do not feel qualified to answer the questions the Member puts.

As a general rule, certainly, we wish service delivery be protected. If there are efficiencies we find that we can pursue, then generally that means we can find savings. The particulars with respect to Arctic B and C airports are something the Member is going to have to put to the Minister of Community and Transportation Services.

Mr. Lang: It is a very serious situation here. It attacks the whole credibility of the government when we negotiate terms and conditions with our senior level of government by stating that we need certain things in order to do certain programs. Then we find out, not even within a year of the transfer, we are cutting back substantially on the dollars allocated to those programs. We are not talking a 10 percent cut, we are not talking about freezing, we are talking a $500,000 decrease out of a $2 million program.

I would ask the next question: is this the same thing that has happened with the department of highways? With the consequences of those five highways being transferred, I believe it was $8.4 million, being allocated to those particular highways. I understand that the highways department’s whole budget has been cut. In other words, last year we spent over $13 million on highways, on the capital side of our budget, and now, I gather, we are at $9 million, or something. Can the Minister verify whether that was a conscious decision in putting this budget together that we were going to knowingly cut back on our capital allocation of dollars to the highways department and knowingly take money away from those highways where we had budgeted $8.4 million for the past five years, knowing we are going to get that money and put it on other highways?

Hon. Mr. McDonald: Again, the Member is going to have to take the particulars up with the Minister of Community and Transportation Services but I will make a general comment. When the Government of the Yukon takes over responsibility for, say, the road program, the understanding is that all costs associated with the program to meet public expectations and economic demands will be met by the Government of the Yukon.

The reason for devolution is that the Government of the Yukon sets its spending priorities, not the federal government or the Government of Canada. When the transfer has taken over and the funding is provided to allow the federal government to take on the responsibilities, the territorial government has to make hard decisions every year based on all its priorities to determine whether or not it can meet certain emerging needs and delay its response to other needs.

For example, in a particular year an emerging need may be a public school in Porter Creek and consequently, there may have to be less capital spending in other areas. In another year, there may be emerging needs in the highway program that we now have responsibility for that we will have to meet in that year and work on things like schools will have to be delayed. We establish the priorities, once we have the responsibility, and, overall, we test all the needs of our community, establish priorities and budget accordingly. It may mean from time to time that the roads budgets may go up or may go down. Certainly in the last few years they have gone up dramatically. This year they have gone down. Nevertheless, we have to set all our priorities based on the funding levels that we have.

Mr. Lang: The difficulty I have is that not all of the information has been provided for me. I am going to ask the Minister for Community and Transportation Services if he has the financial breakdown between what we spent on territorial highways last year versus what we are projected to spend this year. The Minister had undertaken to provide that to me at an early date and some time has passed since that time.

Hon. Mr. Byblow: The Member posed a series of questions relating to the dollars being spent on highways over the past couple of years: what is for this year, what is for next year? He raised some questions about the amount of money spent on camps. I have compiled several sheets of that information. It is with my budget material for Community and Transportation Services. If he wants that information, I am sure I could go upstairs and get it to him before the end of the day. It is detailed information related to my estimates that I am prepared for and I have available now. I believe I tabled the airports information at noon today, as a matter of fact.

Mr. Lang: I appreciated the airport information and I had asked, at the same time, for the highways information, and to have it before coming into the House, so if the Minister could make it available to me tomorrow morning, I would appreciate it. The Minister has acknowledged that.

I guess my point is that the difficulty we find is that we have had a Minister of Finance going around the territory crying poverty, in a three-piece suit, telling the people of the territory that the next thing to pestilence and flood and disease, we are going to have a major cutback in our financial situation from the Government of Canada. Yet, much to our surprise, the Minister presents a budget that gives not only a $19 million increase but a $23 million increase when we take into account the increase in government tax revenue.

It has been very difficult for us to believe that the Minister is cutting back, especially when he increases the size of the civil service by an additional 117 people.

Does Madam Chair have a problem with her glasses? I was just wondering why you were making those faces at me.

The concern I have is with the believability of the Minister. He tells the House, quite pompously, that he is holding the line. We have not gone into the Executive Council Office to see if they are planning any more trips to Sweden  or any more international globe trotting. We will be looking forward to seeing what holiday plans the front bench has for this forthcoming year.

The point I want to make is that I find it difficult to understand how the Minister can say that he made all these cuts to his budget. I do not have any problem with the government making decisions on priorities, but it concerns me to see substantial decreases in areas we, in Yukon, usually accept as normal expenditures, such as highways or airports. There is a $500,000 difference budgeted for this forthcoming year than we had the previous year.

I think that should be a badge of honour. Perhaps the Minister of Finance could outline where he slashed this budget when he put it together. I recall an interview on CBC when he first put it together, and he could not tell the commentator where he had taken any money out of it. He just said he took bits and pieces, and he shaved the budget very closely. I do not know if he used an electric razor or a straight razor.

The Minister has an obligation to tell us from where, in formulating the budget, they took these extra dollars. There must have been a conscious decision in Community and Transportation Services about in the neighbourhood of $3 million to $5 million,  to be taken away from the operation and maintenance and capital sides of that budget to make up for other expenditures.

Somebody had to make that decision. In putting this budget together, did the Minister know that those expenditures were going to be less in that area, so he could offset increases in the size of the public service, for example?

Hon. Mr. McDonald: It is really frustrating to go through the same debate with the Member for Porter Creek East that we just went through only two hours ago for about an hour and a half - I will not say he was not here - on exactly the same topic with the Member for Hootalinqua and the Members who were present. All the issues that the Member just asked questions about, as if it were a brand new subject, we spent an hour and a half over. Yes, we did. We talked about cuts to the budget. We talked about the increase in person years. We talked about the formula agreement itself. The Members across the floor are suggesting that the Minister of Finance for this government should not express any concern about the formula financing agreement, because they disagree with some of the spending priorities of the government side. They feel that I, as Minister of Finance, should openly support a formula financing arrangement that takes as its basic premise that the tax rates paid by Yukoners are too low - substantially too low; 40 percent too low  - and that until this Legislature raises taxes by that much, the new formula arrangement will cause the Yukon Legislature, the Yukon government, to suffer special penalties under the agreement.

The Member wants this Finance Minister to openly agree with that. He ridicules this Minister for critiquing that.

The Member wants me to answer his question. This is after he makes a dozen ridiculous allegations, which I will answer first.

The second point is that the Member thinks that the Finance Minister, representing this government and the Yukon, should not be critical of an arrangement where the growth in the transfer payment is less than the increases that are being provided to provinces on a per capita basis, that it is less than the PL escalator, which is the provincial local escalator and is the average of the provincial municipal budget increases, which was the hallmark of the previous escalator under the formula financing agreement. He feels that, because we are not being treated fairly there, we should still support this formula financing agreement, simply because the Members opposite do not agree with some of our funding priorities.

What are those funding priorities they do not agree with? Let us talk about the 118 person years. First of all, for the first time today, the Member for Hootalinqua recognized that the increase in the transfer payment is not a real increase, because the recoveries, which were under contract with the Yukon government ... I am sorry. The Member is still saying he is ignorant of the truth of the matter. I will explain it to the Members opposite.

Some Hon. Member: (Inaudible)

Chair: Order please. Please allow the Member to finish.

Hon. Mr. McDonald: It is all right, Madam Chair, I do not expect civility any longer from the folks opposite.

The transfer payment to the Yukon government under the Formula Financing Agreement increased by just over $10 million. The funding that was under contract with the Government of Yukon for the operations of the airports and the territorial roads program has been rolled into the federal transfer payment. It was in contract services; it is now in the federal transfer payment. The growth of the federal transfer payment has been $10.5 million.

The Members talk about the growth in the budget, and the growth in the person year complement. The Member for Porter Creek East disagrees with the spending priorities of the government, and disagrees with the growth in the person year budget. I have made this information public, but the Member for Porter Creek East disagrees with the 20 teachers we have added to the public school system. He disagrees with it. I disagree with him.

The Member for Porter Creek East feels that the native language instructors, who are under employment contract, should not have been converted to person years. That is on the record. The Member knows full well the consequences of criticizing 118 person years. Clearly, he is opposed to the native language instructors being converted to person years. I appreciate the Member’s position; I understand the Member’s position. I profoundly disagree with the Member. I support the increase in teachers; the Member does not support the increase in teachers. I understand that.

It would be honest of the Members opposite if, when they criticize the 118 person year increase, they acknowledge the fact publicly when they are saying, in the same breath, that they do not support the extra teachers and do not support making the native language instructors person-year employees. They have to come clean. What is the point of being dishonest? If they do not believe in the teachers, they should say so.

The Members have made all kinds of comments about the Minister’s trip to Sweden, something the Member for Porter Creek East thinks is a summer holiday. Last year, I announced that there would be funding for the circumpolar ministers conference, a conference that we had just hosted in the Yukon.

The Members opposite thought it was truly wonderful for Ministers to come together at the Circumpolar North conference in the Yukon, come together in Haines Junction, but it would be a terrible event for the Minister of Education for the Yukon to reciprocate and go to Sweden.

They have made that position clear. It is not a particularly honest position. They may not realize it, but it is not a particularly honest one. I think again that the Members should take some trouble to understand what it is they are proposing. They should come out publicly and state that if they did not wish the Minister of Education for the Yukon to go to the Ministers conference outside of the Yukon, then they should not have been lauding the fact that there was a Ministers conference in Haines Junction, with those same Ministers coming to the Yukon. They cannot have it both ways; that is not fair. That is not honest.

I have never indicated that the budget was slashed here, there and everywhere. I indicated that efforts have been made to shave the budget in various areas. The departmental Ministers will defend those estimates. It remains the responsibility of the Government of Yukon to determine what spending priorities there are for the government and to present those to the Legislature.

The funding provided under an agreement such as the territorial roads agreement is for a 20-year period. It is appropriate, from year to year, to change priorities to meet the greatest need. If, in the year 1991-92, the greatest need is perceived to be a public school in Porter Creek, then presumably the Members will support that. I am not sure about that yet, I will check that out. But, the money must come from the overall allotment provided for capital. It has to come from the money available to the Legislature for the purposes of making an expenditure. If we have not been building schools before, we cannot have an historic level of funding for building new schools. That is a given. So, when we do make a $6.5 million commitment to a school in Porter Creek, we must make room for it in the capital budget. That, I believe, would stand to reason. Now, if the Members feel that the spending priorities are wrong, that the money should not be spent on the school but rather should be spent instead on the North Canol Road or something else, then they should make the case. Make the case clearly and cogently, and the government will consider that.

These priorities in the spending plans are priorities that we feel meet the greatest expectation for this territory. These are priorities that we are prepared to defend, as departmental Ministers, and feel that these are the priorities that the public will consider will meet the greatest needs.

Because the funding for various things has been transferred to the Yukon, it will be this Legislature that decides what those priorities will be. They will not be historic expenditures in some federal department. It has always been expected that our spending priorities will vary with what we consider to be the greatest need.

There will come a time when the territorial Legislature will be asked to contribute toward something like a Whitehorse sewage treatment plant. We do not have an historic level of expenditures to support large sewage treatment plants, so there is going to have to be some effort made to make room for a Whitehorse sewage treatment plant. That is going to have to displace something else in the capital plan. That is obvious. Consequently, I am sure we will hear all sorts of contradictory criticisms by Members opposite about the government spending too much, or that the fact the government is spending the money at all means it is interfering in the economy, or any number of weird and wonderful contradictory comments.

The Members have said we have wasted the money already, but they are here during the budget estimates. Of my budget estimates, when we get to Education, which ones do the Members feel should not go ahead?

The Member has already criticized the 20 teachers, so I know where he stands on the 20 teachers. Where do you stand on the other items? As departmental Minister, I should know where Members of this Legislature feel that the expenditures are misdirected. We will ultimately have plenty of opportunities to do that. I am looking forward to that particular discussion. I hope Members show up for it.

I move that progress be reported on the bill.

Motion agreed to

Hon. Mr. McDonald: Madam Chair, I move that the Speaker do now resume the Chair.

Motion agreed to

Speaker resumes the Chair

Speaker: I will now call the House to order.

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

Ms. Kassi: The Committee of the Whole considered Bill No. 16, First Appropriation Act, 1991-92, and directed me to report progress on same.

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

Some Hon. Members: Agreed.

Speaker: I declare the report carried.

Mrs. Firth: I move that the House do now adjourn.

Speaker: It has been moved by the hon. Member for Whitehorse Riverdale South that the House do now adjourn.

Motion agreed to

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

The House adjourned at 5:28 p.m.

The following Legislative Returns were tabled November 27, 1990:


Cost of ministerial travel and trips funded from departmental budgets for MLAs, Ministers and ministerial assistants, December 1, 1989, through October 25, 1990 (Penikett)

Oral, Hansard, p. 77


Arctic B and C airports agreement: funding respecting transfer from federal Ministry of Transport to Government of Yukon (Byblow)

Oral, Hansard, p. 92


SS Tutshi fire investigation (Byblow)

Oral, Hansard, p. 265

The following Sessional Papers were tabled November 27, 1990:


Forest Resources Policy Options for the Yukon (Webster)


Markets for Yukon Forest Products (Webster)


A Forest Tenure System for Yukon (Webster)


The Forest Industry in the Economy of the Yukon (Webster)