Wednesday, November 27, 1991 - 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.
INTRODUCTION OF VISITORS
Mr. Phillips: We have several guests in the gallery today including a class from F.H. Collins and their teacher, Mr. Paul Deuling. I would like all Members to welcome them to the House. They are here today to observe the Legislature in action.
Speaker: Are there any Returns or Documents for Tabling?
TABLING RETURNS AND DOCUMENTS
Hon. Ms. Hayden: I have for tabling the annual report of Health and Social Services for the year ended March 31, 1990.
Speaker: Are there any Reports of Committees?
Introductions of Bills.
Notices of Motion for the Production of Papers.
Notices of Motion.
Statements by Ministers.
Energy Strategy/Power Smart Ideas Shop
Hon. Mr. Byblow: In the conservation strategy that was developed by this government and tabled last May in the House, this Government made a commitment to develop a comprehensive energy strategy. I am pleased to advise that work is now underway to consolidate the existing policies and principles on energy issues into one document. In addition, we are building on this existing foundation with new initiatives to create a comprehensive energy strategy to provide a clear direction for the Yukons energy future.
The strategy will outline policy directions and program actions for the future.
It will link principles outlined in the Yukon Economic Strategy and the Yukon Conservation Strategy, the Yukon Energy Corporations five-year plan, the Fuel Price Inquiry and the Northern Accord agreement-in-principle.
It will also consider directions to take on new and challenging energy issues and how these can best relate to the development of our economy. Issues include matters such as how we, as a government, can best promote energy conservation and how encouraging import substitution in the energy sector can contribute to local development. Introduction of an independent power producers policy to encourage development of local energy resources and a mechanism to fairly allocate the risk costs associated with new developments are important components of our planned energy strategy.
We will bring this energy strategy together for public review early in the new year, and we will look for innovative and sound ideas for our energy future. The strategy will be ready for implementation by March.
The main emphasis of the strategy will be on what we can do to ensure that energy is produced and used in the best interest of Yukon people, their economy and their environment.
The Yukon Energy Strategy will be governed by five fundamental principles: secure energy supplies, environmental protection, using energy to stabilize and diversify the economy, fair energy pricing and efficient energy production and use.
As you may be aware, the Yukon Energy Corporation and the Department of Economic Development: Mines and Small Business opened a Power Smart Ideas Shop in Whitehorse. This shop represents a major step for energy conservation. It does not sell any items but rather shares ideas and tips on conserving energy with Yukon consumers. More important, the Ideas shop is just one clear example of the public education component of the Yukon Energy Strategy.
As part of a drive to reduce energy consumption and future energy needs, several initiatives are happening in the Yukon. Earlier this year, we announced two energy saving programs - the low-flow shower heads and the power-saver cords - that have been implemented very successfully. Approximately 3,500 power cords and 4,000 shower heads have been sold. These are just a few, early examples of demand-side management programs emanating from the Power Smart Ideas Shop.
Mr. Phelps: It is interesting that this statement comes out at this time, when the Yukon Energy Corporation is before the Public Utilities Board trying to justify a proposed increase in our electrical energy rates.
The record will show that we on this side have been complaining for years about the lack of an adequate, comprehensive energy policy in this government. We welcome any commitment, such as this one, to improve the existing, deplorable situation.
Speaker: This then brings us to Question Period.
Point of Order
Speaker: The Member for Porter Creek West, on a point of order.
Mr. Nordling: On a point of order, I would like the record to show that, as a member of the Independent Alliance, I stood in this House to comment on the ministerial statement and was refused recognition by the Speaker.
Question re: Yukon Energy Corporation policies
Mr. Lang: I want to bring the Members attention to the situation that the Yukon faces with the Yukon energy requirements for the territory and the deplorable situation consumers are faced with at the present time, in view of the decisions that have been made over the years on the dividends to the Yukon Development Corporation.
I should point out that the President of the Yukon Development Corporation resigned the other day because of the political involvement of the government with the corporation.
Now, today, to further give evidence to the fact that the Government of the Yukon Territory does not have a comprehensive energy policy, the Minister states he is going to create a comprehensive energy strategy to provide a clear direction for the Yukons energy future.
Yesterday, at the Public Utility Boards hearing, there was a request for the Minister to appear as part of an energy panel at that forum in order to explain the long-term energy plans of the government.
Could the Minister tell this House if the reason he turned down the request to appear before that particular forum is because the government does not have an energy strategy in place that would provide a clear direction for Yukons energy future?
Hon. Mr. Byblow: The Member, through his preamble, placed on the record a number of things that are patently false and clearly misleading. He implies that there is political interference relating to the Energy Corporation, and I have spent the last several days telling the Member of the relationship between the corporation and this government, structured in law, directed by policy, that precludes political involvement. The Member understands that the corporation is run by a board of directors and administratively by a president and staff.
It is entirely inaccurate to suggest that, because of some political interference, the Yukon Energy Corporation is in difficulty.
In response to the Members question, as emanating from the hearings, I should point out that I had not been requested to appear before the hearings. The request was made by one of the lawyers appearing at the hearings.
Mr. Lang: The Minister indicates there is no political interference by him or anyone else. It is very interesting that it is becoming more and more apparent that the Yukon Energy Corporation and, through that, the Yukon Development Corporation have become political arms of the party opposite. I speak from knowledge of what is going on. It is common knowledge that, now that the Minister is not going to appear, the chairperson of the corporation is going to appear, who happens to be a very close friend of the side opposite.
The story goes on. Talk about impartiality.
It was requested at the board. Why did the Yukon Energy Corporation decline and have the chairperson appear before that panel, as opposed to the Minister appearing on behalf of the government?
Hon. Mr. Byblow: The Member imputes that somehow the Energy Corporation and the Development Corporation are hamstrung because of political involvement by this government. The Member, in his earlier preamble, made the point that the lack of a comprehensive energy policy was somehow thwarting the operations of the corporation.
Less than a year ago, the then-Leader of the Official Opposition was proposing that we should go out and build megadams - 40 megawatt projects, that would virtually cripple the financial health of the corporation. Members should recognize that the quick-fix solutions proposed by the Members opposite will do nothing to resolve our energy needs.
The corporation is appearing before the Utilities Board at this time. It is answering questions on its rate application. It is due process that is occurring. The Public Utilities Board is a judicial body, put in place to address matters put forward to it by the utilities. That process is occurring...
Speaker: Order please. Would the Member please conclude his answer.
Hon. Mr. Byblow: ...and it is occurring now, this week.
Mr. Lang: The facts speak for themselves. The consumers of electricity in the Yukon are looking at - and have already had - significant increases, and are now looking at some more increases if the application is approved by this board. At the same time, there is a panel that is being put in place so that they can be asked questions about the long-term energy requirements of the territory.
Speaker: Order please. Would the Member please get to the question.
Mr. Lang: I want to know how the chairman of the board of directors of the arm of the New Democratic Party, the Yukon Development Corporation, is going to be able to give answers to that panel when the Minister stands in his place and says that he is going to create a comprehensive energy strategy to provide clear direction for the Yukons energy future, which will be available in the new year.
Hon. Mr. Byblow: Members opposite are hardly experts when it comes to matters of energy policy or energy policy direction. It is the Members opposite who took the position, less than a year ago, that would have required over $400 million to be invested in megaprojects of energy that would not only have crippled the Yukon Energy Corporation, but would have put an onerous burden on all electrical consumers in the territory. That is the policy position of Members opposite.
The policy position of this government was to go out and seek input from the public and develop a strategic plan, which I am sure the Member who is questioning me today has never read, much less seen. It outlines the strategic investment plans of the corporation for the next decade. Policy direction and the plans are clear, consumers...
Speaker: Order please. Would the Member please conclude his answer.
Hon. Mr. Byblow: ...are more than adequately served by the existing utility.
Question re: Yukon Energy Corporation policies
Mr. Lang: It is becoming a routine in this House - I do not believe the Minister has answered one question in the past three days regarding energy. I want to make a number of points, first of all it was never the policy position of this Legislature that the electrical consumer in the territory would pay for such ventures as Yukon Forest Products.
The Government Leader said they did not. Well, we will follow that up later.
I want to ask the Minister about the Yukon Energy Corporation and the rate increases that the people of the territory are presently being requested to take on, on a monthly basis. In the strategic plan that the Minister refers to, has the corporation done projections of future energy rates and if so, are the people of the territory looking at another rate increase in 1993?
Hon. Mr. Byblow: The Member somehow, in his convoluted logic, suggests that energy rates in the territory paid for some forestry venture. Let the record show that nothing could be further from the truth, in terms of how Yukon Development Corporation invests its money. I believe later this afternoon we will be debating a bill, during which time I am sure Members will try to make that charge again.
The Member talks about rate increases. The record is fairly clear. Since Yukon Development Corporation assumed, through Yukon Energy Corporation, the assets of NCPC, in 1987, this territory has seen not only stable rates, but rates have been reduced. In that five-year period, during a time when we had inflation reaching 20 percent, we saw no less than an eight percent increase in rates. So the facts do not support the Members allegation that the increases are out of control or that the increases are somehow unjustified. The Member knows that rates are established on projected costs of running a utility in the coming year. That is what is being discussed and debated at the Public Utilities Board hearing now.
Mr. Lang: The Minister is consistent. He never answered the question. I asked the Minister, and I will repeat the question, can he tell this House if the corporation has done some projections for 1993? If so, will the consumers of electricity in the Yukon be looking at additional increases in that year if those projections hold firm?
Hon. Mr. Byblow: Let me deal with the question. The matter of future energy rates is being dealt with by the utilities board at this instant in an application put forward by the Energy Corporation and Yukon Electrical. Projections are just that. They are an educated calculation of future costs. We are not talking about energy rates in 1993. We are talking about energy rates for the current period, between July and December of 1991 and anticipated costs for next year, 1992.
The Member knows precisely what is being sought. We are seeking a five percent rate increase for 1992. Those are the facts of the matter.
Mr. Lang: The Minister never answered my question. I did not ask about 1992 and I did not ask about the present hearing. I asked if the corporation had done some long-term projections on energy rates. My question is: if those projections were done, is the consumer going to be looking at an additional increase in 1993?
Hon. Mr. Byblow: I have to compliment the Member for finally recognizing a principle of energy conservation. He knows what it means to recycle. I will recycle my answer.
The Energy Corporation has placed before the utilities board a rate application that addresses a variety of issues and projections. There are a number of long-term projections. Those figures are before the board.
The short answer to the Member is yes, the Energy Corporation, in its educated best-guess calculations, has done some projections for the future. Part of those projections are laid out in the strategic plan, which calculates that there are an estimated 16 megawatts of energy generation needed in the territory over the next decade.
On top of that, we anticipate that five of those megawatts are going to be provided through demand-side management programs. Those facts are clearly laid out.
Question re: Deputy Minister of Economic Development, rumoured termination
Mr. Devries: I have a question for the Minister responsible for Economic Development. He appears to have difficulty keeping senior management working with him; the president of the Yukon Development Corporation, for which the Minister is responsible, has resigned, and now I have heard reports that the Deputy Minister of Economic Development has been given an offer he could not refuse, that he left under suspicious circumstances - or he was fired. Is it true that this Deputy Minister was fired?
Hon. Mr. Byblow: The answer is no.
Mr. Devries: It must be lonely at the top. Since the Minister has lost two senior Deputy Ministers who were responsible for Economic Development in the territory, can the Minister advise the House who is currently minding the store in these two important portfolios? Are there any senior managers left in government who are prepared to work with the Minister?
Hon. Mr. Byblow: I am inclined to ask the Member whether he is looking for a job.
Let me advise the Member that the current Deputy Minister of Economic Development: Mines and Small Business is in place. His name is Mr. Nick Poushinsky; the current deputy head of the Development Corporation is Mr. Michael Sweatman.
Question re: Furniture, contract for local manufacture
Mr. Phillips: We have been made aware that the government has recently entered a five-year contract to purchase locally manufactured furniture. Could the Minister of Government Services tell us if this contract was publicly tendered? Will the Minister table the contract in the House?
Hon. Mr. McDonald: In answer to the second question, I have no problem with tabling the contract in the House. I am unaware of the details surrounding the tendering procedure, as I do not personally do that. There are rules and regulations by which the department must abide, and I am certain that, as per usual, they are abiding by those regulations.
As all Members know, the Member has a motion for the production of papers on the Order Paper that also deals with contracts to local furniture manufacturer/suppliers. I will be assembling that information, and it will be passed around to all Members.
Mr. Phillips: To comply with the rules of our House, I neglected to mention, before I asked my question, that if we get to that motion today I will be standing it aside in order to comply with the rules about asking questions about the same matter.
The Department of Finance was the most recent recipient of this new furniture. To everyones surprise there, movers arrived with the new furniture to replace the existing furniture in 11 offices. Some of the furniture replaced was less than three years old. It is my understanding that no one even requested this new furniture.
Would the Minister table any requisitions or requests of any form from any manager of the Department of Finance that requested new furniture?
Hon. Mr. McDonald: I will take the question as notice. Again, I am not personally familiar with the provision of furniture to any particular department. For the Members information, the reference I had made to the motion on the Order Paper was not a procedural point, but simply to point out to the Member that the information is going to be coming forward.
Mr. Phillips: I am sure that any furniture we purchase for the Government of the Yukon has to meet certain high standards. Is the Minister aware that several of the new desks in the Department of Finance had to be covered with glass tops or blotters because the surface of these expensive desks were too rough to write on and people were getting slivers off some of the desks?
Hon. Mr. McDonald: I have not heard that claim being made by anybody. Certainly, the Government of Yukon does have respectable standards for the provision of office furniture. I would suspect that upon receipt of that furniture they would be checking the quality of the workmanship. I do feel that it would be unnecessary, and probably quite unfair, to cast a shadow over all locally produced furniture and on the people who work in the field here in Whitehorse by suggesting that there may be flaws in some of the pieces that are produced. This matter will be checked into with the Department of Government Services and I will report back with some information.
Question re: Furniture, contract for local manufacture
Mr. Phillips: When the government procures furniture from anybody at all, whether it is locally manufactured furniture or furniture shipped from outside, we have a local standard that we expect to meet. If these particular desks do not meet that standard, we have a right in this House, or any individual in the public has a right, to question whether or not we are getting value for our money.
Can the Minister confirm that some of the recipients of those new desks in the Department of Finance had to book off sick because of odors that were being emitted from the desks when they put them into the new office space?
Hon. Mr. McDonald: The right to question by Members opposite on any item that is the business of the government is a right without question. The only reservation, of course, is that common sense, good sense and a sense of fair play is seen to be warranted. (inaudible)
I am hoping, on checking the matter, that whatever is reported will also include some reference in the response of the Department of Government Services so that the public does not draw the wrong conclusion, based on the Members allegation.
Mr. Phillips: I wonder if the Minister could check a couple of other items while he is checking out the items that I mentioned earlier.
Can the Minister confirm that the new computer tables in the Department of Finance are not wide enough to hold both the screen and the keyboard, and that individuals using the computers have to either hold the keyboard on their lap or put the keyboard on the desk beside them so that they can operate them?
Hon. Mr. McDonald: Again, that is a matter that I do not have personal knowledge of. I would suspect that if the size of the furniture is not correct, it would not necessarily be the fault of the supplier; it may be the fault of the people who inspect the furniture in the first place. If the furniture is of an improper size in a particular office, then we will have to ferret out the responsible agent in order to rectify the situation for all future purposes.
Mr. Phillips: I think that the Minister should look at all aspects of the procurement of this furniture, right from the design or the specifications put out by the Government of the Yukon and the furniture that it received.
I have had reports that several pieces of the new furniture already have had to be replaced or repaired because they have broken or there has been some difficulty with them. I wonder if the Minister can bring back the information about the costs of replacing that furniture and what furniture they did have problems with.
Hon. Mr. McDonald: Of course I will investigate the allegation again made by the Member. However, I think that it is important to point out once again, for all those who are listening to this particular exchange, that it would be unfair to characterize all of the locally made furniture as being unsound. It is no secret that the Members opposite have opposed the policy of locally developed furniture from the very beginning. Consequently, I think the allegations being made before us now should be put into some context. I will certainly be diligent in bringing the information forward that the Member requests and investigate the matter to the extent that the Member wishes to have it investigated. As well, I will certainly be reviewing with department officials the procedures for the selection of furniture and making sure that the information provided with respect to the information, under the motion for the production of papers, is completely provided.
Question re: School busing by leased vehicle
Mr. Nordling: I have a question for the Minister of Education with respect to school busing.
Yesterday the Minister was asked about students being transported to and from the Carcross school in a leased vehicle. Has the Minister considered the serious implications of an accident involving that vehicle, carrying children to and from the school?
Hon. Mr. McDonald: I think it is important to point out that I am concerned about the potential for any serious accident involving any transportation vehicle that is carrying children to and from school, or on field trips or anywhere else. Certainly, I am concerned about that. The issue of insurance is an issue that should be respected. I care, as well, about the qualifications of the people who are driving the vehicles, but I must point out that on a very regular basis - in all the time that I have been in this Legislature and before that - parents and others have been driving students in vehicles for school activities around this territory. This is nothing new.
With respect to the matter that the Member for Riverdale South raised yesterday, in which he clearly took exception to the provision of some transportation to Carcross students, I have had the matter checked and have been given a preliminary position by the Department of Justice that the regulations pursuant to the Education Act, which deal with busing, have been followed to the letter.
Mr. Nordling: I would like to know from the Minister if a legal opinion was prepared, or if there are documents or briefing notes, with respect to the potential liability of the government, before the Minister authorized this undertaking.
Hon. Mr. McDonald: The people who undertook what I would characterize as being an innovative solution to a transportation requirement did review the student transportation regulations, pursuant to the Education Act.
I was assured that, in creating this innovative solution to the transportation requirements, they did follow all the regulations they are aware of. I did indicate that, while I had not been in on creating this particular solution on the ground floor and was not involved in the design of the solution, when the question was put to me after the fact, I did feel - and I still do feel - it was a job well done.
Mr. Nordling: I think the Minister is confusing apples with oranges on this issue when he talks about school trips. It is okay to be innovative, but in matter such as this, where there is serious potential for liability for the government, we must be very precise.
I would ask the Minister why a legal opinion was not done and all regulations checked before he authorized this to be done. The Minister has spoken about the student transportation regulations. I would like to know if the motor vehicle regulations were investigated and, specifically, school bus regulations, because that is what is being done; we are not going on a school trip.
Hon. Mr. McDonald: The student transportation regulations, pursuant to the Education Act, apply to all school buses as well as to all forms of transportation that are school related. They are the most recent regulations that have been passed by this Cabinet. They are very comprehensive. They have also been, unlike their predecessors, put through a very thorough consultation process with the public, education council, school councils - or, their predecessors, school committees - and with all persons who have a relationship to school busing.
Not only am I convinced that the student transportation regulations are sound and that they apply in this case, but I am also convinced that they were followed in the development of this innovative solution to providing needed transportation for Carcross students.
Question re: School busing by leased vehicle
Mrs. Firth: My question is to the same Minister regarding the same matter. As my colleague said, that is half the job done. I would like to follow up with the Minister as to what is really happening here.
From the Ministers story yesterday, we have the Minister providing free transportation for a teacher who lives in Whitehorse and teaches in Carcross. In doing that, he is authorizing the operation of an illegal school bus. The principal at Carcross sent a letter, plus a picture, of a van to Yukon Alaska Transport and told them to pass on to all the truckers to watch out for this van, because it was now a school bus.
The van does not conform to the CSA standards for school buses. We now find that the teacher is getting compensation for doing this, not, as the Minister alluded to yesterday, that there is a contract in some way.
Will the Minister tell us whether this is a contract or not?
Hon. Mr. McDonald: There is no contract that I am aware of that necessitates the provision of a particular service for pay. I take issue, as does the Department of Justice, with the allegation that this is an illegal school bus. The student transportation regulations, pursuant to the Education Act, have been respected. I am certain the principal of the Carcross school was being prudent in identifying, for a major user of the highway, a vehicle that may be travelling down the highway regularly. That is added precaution, which is only right.
The student transportation regulations refer not only to the standard school bus, for which we contract and pay a premium dollar when we want to use that option; it also covers the transportation of students in other forms. This is not the method for which we contract transportation. This is innovative and different, meaning it is somewhat unique. We have not done this before, to my knowledge, but in my opinion, and that of our lawyers, this is not an illegal service. This is an innovative and low-cost solution to an identified need.
Mrs. Firth: We have established that it is not a contract. I would like to talk about the school bus regulations; that is really the other half of this story. If there is no contract, then the Minister or the operating authority has to have written consent from the Registrar of Motor Vehicles. Since the Minister has said there is no contract here, then they have to have that written consent.
Did the Department of Education have that written consent, before it authorized this creative project?
Hon. Mr. McDonald: I am not a lawyer and I do not pretend to be one, but I did review the Motor Vehicle Act regulations this morning, and I do recall that the consent of the Registrar of Motor Vehicles is required if there is a service provided for pay. It is my understanding that this is not a service provided for pay. In any case, the school busing regulations, under the Education Act, which were only passed very recently, are the operative regulations for the purposes of providing transportation. Those regulations, duly constituted, duly passed, do permit this service in the opinions of our lawyers and in my own opinion.
Mrs. Firth: The teachers used to drive their own vehicle back and forth to Carcross and pay for their own gas. They are not doing that any more. The government is paying for it, so there is some pay there, yet the Minister says it is not a contract so, therefore, they have to have the authorization of the registrar. They do not. I am not a lawyer, but I can read the law; the law says that if it is not under contract then they must have the written authorization of the Registrar of Motor Vehicles. Obviously, they do not have it, and obviously they are in contravention of the law. These children are being put in jeopardy.
Could the Minister table in this House a complete outline of how this initiative was started, the legal opinions, who was consulted, who made the final decisions and how this whole incident came about, that he has endorsed so strongly.
Hon. Mr. McDonald: There is a lot to answer there, because many different allegations were made. Let me just state this, because I think that it is the most important and dangerous point of the Members allegation: that the children have been put in jeopardy.
I want to point out that the solution that was finally accepted by department officials and ultimately approved by me - my approval was not essential in this equation, because the Department of Education and the schools do things that do not necessarily require the consent of the Minister of Education or politicians for that matter, and thank Heavens for that - was that the parents of the students who are involved requested a solution such as this. There was a teacher who volunteered her services to provide this particular service. It was a need that was identified by other community leaders, and it was a need identified by the teaching staff at the school and these people were the genesis of this idea.
The van is in perfectly good working order. Secondly, the driver of the van, who happens to be a teacher and who is providing this volunteer service, and to my understanding is apparently very well qualified to drive this particular van, given that she, while in Alberta last year, had been driving a mini-van for special education students, and also has first aid credentials...
Speaker: Order please. Would the Member please conclude his answer.
Hon. Mr. McDonald: Yes, I will. The problem is not that these children are in jeopardy. The problem is that the Member opposite does not understand that this is a legal, innovative, safe, low-cost service. It is for those reasons that I endorsed it.
Question re: School busing by leased vehicle
Mr. Phelps: It is not very often that I support the side opposite but I do support the Minister in the provision of this service. I am one of the people who asked for bus service for the kids at Lewes Lake, but I would like to ask the Minister if he will continue to provide the service next year if the situation warrants it.
Hon. Mr. McDonald: Under similar circumstances, if there is a teacher willing to do it.
Question re: Buffalo in accident on Jarvis Creek
Mr. Brewster: My question is to the Minister of Renewable Resources. On November 19, I asked the Minister a question regarding a buffalo involved in an accident last summer by Jarvis Creek. Yesterday I received a legislative return saying the department had no record of this event. Does the Minister stand by that statement in the legislative return?
Hon. Mr. Webster: Yes, I have the legislative return right in front of me and I said that, not only does the department have no record of the buffalo incident reported by Mr. Brewster, but neither does the Haines Junction RCMP. They have no record of the accident either.
Mr. Brewster: Well, let us quit beating around the bush about these things. Okay, I made a mistake as to the gender of the driver. Was there not a buffalo killed in August, on Jarvis Creek?
Hon. Mr. Webster: I would be pleased to help the Member find an answer to his question if he could provide me with some kind of a hint as to who the person was, so that I might assist the RCMP to provide me with information, to confirm his suspicion.
Mr. Brewster: Did the Minister ever check with the conservation officer at Haines Junction?
Hon. Mr. Webster: As it was my department who prepared a response to the question raised by the Member last week, I can only assume that the department would ask the conservation officer located in the area to determine if indeed that individual did know if there was such an incident. We did take the time to contact the RCMP in Haines Junction. In addition to that, we contacted the RCMP in Whitehorse, who also had no record of that accident. I am certainly open to some suggestions from the Member opposite to follow up on, in order to solve this mystery.
Speaker: The time for Question Period has now lapsed.
Orders of the Day.
ORDERS OF THE DAY
Speaker: Motions for Production of Papers.
MOTIONS FOR THE PRODUCTION OF PAPERS
Motion for Production of Papers No. 4 - adjourned debate
Clerk: Standing in the name of Mr. Nordling, debate adjourned, the Hon. Mr. Penikett.
Speaker: The question before the House is
THAT the House do issue an order for a return of all financial analyses and forecasts completed in relation to the Yukon governments decentralization program.
Hon. Mr. Penikett: At the outset of my remarks from this continuing debate, now entering its second week, let me convey to the House the astonishment of Members on this side that we are even dealing with the matter at all.
Let me repeat what I said last week. All the information that had been requested in the motion had been previously made available to this House and to the public.
Members on this side of the House felt a not unreasonable measure of frustration at seeing time which, under our rules, is intended for debate of their private Members motions usurped by what we saw as an abuse of the rules in order to debate a matter of no urgency, and one that is already before the House in the main estimates, which are now in Committee.
I cannot read the minds of the Members opposite. I have demonstrated, on many occasions, a complete inability to do that. Many of their ways of thinking are a mystery to me. Yet, I would be surprised if the majority of Members opposite did not feel the same frustration today that this side felt last week at having their time on motion day usurped by a rump group in this House, to debate a matter that has already been extensively debated on the one hand and is already before us in another forum.
Nonetheless, I am obliged, as the responsible Minister, to deal with the substance of the matter before me. Unfortunately, since the slur and slander in the motion suggests that we have not provided information on this matter and will remain on the record for all time, it will therefore be necessary for me today, to deal at some length with the issues that have been raised by the question put by the Member opposite.
I did not look forward to this opportunity to speak two weeks in a row on this question. This is the first time in my life in this House when I have been grateful for the provision in our rules that permits me unlimited time to respond to the totally unfounded accusation of the Member who presented this motion. I regret that Member is not here to hear my speech.
I strongly believe that this is a totally unnecessary debate. I would like to explain why. I will do so by restating a point I made a week ago that this motion is unnecessary because the government has, since the details of the decentralization initiative were announced last fall, consistently made information available to Members of this House and to Yukon citizens generally.
I will not only repeat that assertion throughout my intervention today, but I intend to, perhaps in nauseous detail, elaborate on my case.
In the first part of my speech, I do not intend to waste the Houses valuable time by restating the track record of all the questions we have responded to in this House - I may have to do that later, but I will not do it now - on the information we have provided and the consultations that have occurred with Yukon communities. It is a track record worth noting.
If there are Members of this House whom it did not impress when I spoke about it on November 20, I would refer those absent Members to page 1320 of the Hansard where the details are recorded.
I may have violated the rules by calling attention to the absence of the movers of the motion in the House. I regret doing that; I apologize, and I will not do so again this afternoon.
However, I will restate the position of this side of the House: all Members of this House have had ample opportunity to question spending on decentralization during Committee studies of this and the previous budget. We have already been through this process once during debate of the estimates for 1991-92, that is, for the first year of the governments decentralization initiative.
The process continues, even now, during our ongoing examination of the first supplementary budget for this fiscal year, in which a number of questions have already been raised and answered. Of course, we anticipate further questions during the coming debate on the 1992-93 budget, to which we will try and respond as completely as we can.
We have consistently been forthcoming about the proposed spending related to decentralization, and we have no reason for wanting to change that approach. We are not in the slightest degree uncomfortable with the debate on the financial implications of decentralization for three very good reasons.
First, we have instituted a careful planning process founded on a decentralization policy that both defines our decentralization goals and establishes roles and responsibilities for carrying out the decentralization initiative.
A Member in this House last week expressed the view that we had no policy to guide our decentralization plan. In expressing that view I say, with great kindness to the Member, that he was wrong - not only about the facts of the matter, but he also diminished the valuable input of Yukon citizens that guided and influenced the development of this governments decentralization policy.
For the record, the public input was provided in a number of venues: firstly, during the Yukon 2000 consultation process, which led us to commit this government to decentralization of the Yukon Public Service. That commitment found expression again in the economic strategy adopted by this House; secondly, via the workings of the advisory committee on decentralization, which included representatives of the Association of Yukon Communities, the Yukon Chamber of Commerce, the Council for Yukon Indians and the Yukon Federation of Labour - all parties deeply interested in this question; all parties, though, who had profoundly differing views about the scope, direction and style of decentralization that should be considered.
All Members will no doubt recall that rural communities were very interested in wholesale decentralization. Some rural politicians even expressed approval for the kind of forced-march approach hinted at by the Member for Riverdale South. The Yukon Federation of Labour and the government employees union, were properly concerned with the rights and interests of the workers involved.
I am going to mention later about why this policy has met with the general approval of the employee representatives, but they had a proper concern in that area. The Yukon Chamber of Commerce was of the view that decentralization, properly done, presented enormous potential benefits for local economies throughout the Yukon Territory. Indeed, a view that I share is that the benefits of public spending ought to be shared fairly around the territory, not enjoyed exclusively here in Whitehorse.
The Council for Yukon Indians, of course, had a view of decentralization that is governed by their wish to see the Yukon public services be representative of the population as a whole, and to see the presence of aboriginal people in the Yukon public service increased, a view that this government also shares.
The third way in which the input of the public was heard on decentralization was through resolutions of the Association of Yukon Communities and the Yukon Chamber of Commerce, both of which organizations brought to the governments attention their specific views on this important matter.
That input helped shape the development of our policy goals. Therefore, we believe that the policy and the plans that flow from it reflect properly the desires and interests of Yukon citizens, especially, those citizens in rural Yukon who feel and have felt that governments, whether federal or territorial, have not always conveyed to them a fair share of the public services that ought to be enjoyed equally by all citizens of this territory and this country.
Our policy also outlines roles and responsibilities for planning and carrying out decentralization initiatives. The decentralization planning and review process is guided by a number of criteria, that serve the interests of both government and Yukon citizens, both in rural communities and in the Yukon community as a whole. The overriding consideration for departments and agencies in developing decentralization proposals is that they must be consistent with, and help achieve, the governments goals and priorities, that is, the goals and priorities we were elected to achieve.
Let me share with all Members some of the internal management considerations. These considerations include the question of cost effectiveness: does this or that proposal represent good value to the Yukon taxpayer? Operational requirements: does this proposal or that proposal permit effective delivery of the program or service in question? Service needs of communities: will this proposal meet community needs and interests? Staff interests and suggestions: do those with experience in delivering a program or a service have suggestions about how it could be delivered most effectively in a rural location?
All of these questions are considered as we come to the management decisions about decentralization.
The planning and review process also considers the interests and concerns expressed by the rural communities themselves. Are there suggestions or requests for positions or services that the communities have made? Is there specific information that communities have provided about the economic or social development directions they are pursuing, which could be supported by decentralization initiatives of this government?
Once departments have developed their proposals, they are reviewed and analyzed by a team. This team is lead by the Executive Council Office, specifically by the decentralization coordinator - an excellent person - and includes representation from the Department of Finance, the Department of Government Services and the Public Service Commission.
This latter group makes recommendations on the departmental decentralization proposals that are submitted to the Deputy Ministers Review Committee for their consideration. Members who were in government will know that the Deputy Ministers Review Committee is a body of long standing. It includes all the Deputy Ministers in the government as well as the deputy heads or administrative heads of Crowns. It is chaired by the Cabinet secretary, the ranking member of the Public Service and in his or her absence, another deputy, usually the Public Service Commissioner.
This is a body that may review all sorts of important and pressing policy matters before they go to Cabinet, not, as I hasten to assure Members, for the purpose of stapling, folding and mutilating them, but for the purpose of having a comprehensive, holistic look at the question in order that more than simply a departmental perspective can be brought to the matter, but indeed a corporate view of the question.
This body has regular meetings with extremely challenging agendas, particularly at a time in our history when we are negotiating land claims and self-government agreements, and has many important discussions involving devolution questions or other intergovernmental matters before us. It is a body that is called upon a lot by Cabinet to consider issues, but which also takes unto itself the responsibility for considering, discussing and recommending to Cabinet matters that deal with policy.
Beyond that, this is the most senior group in the government to deal with matters that are almost entirely within their domain: questions of administration. It is this body to which we look for all sorts of special advice about decentralization.
Let me explain why that is important. I cannot speak with authority for the government led by the Member for Hootalinqua, but I think I was around long enough to observe the government led by the former Member for Riverdale North, Mr. Pearson, and I knew something about the activities of previous governments, to know that every government in the Yukon has, in one way or another, been committed to the objective of decentralization.
However, there was considerable passive resistance inside the public service, not for nasty, mean or malevolent reasons, but for the same reasons that many individuals, as well as organizations, resist change. If you have scarce resources, if you are looking for administrative convenience, frankly, it is a lot easier to have someone working in an office in Whitehorse, living in Riverdale and being available to you at short notice, than it is to have people in the communities. This is like bureaucracies everywhere, whether we are talking about the old Czarist bureaucracy in the Soviet Union before 1917, or the Soviet bureaucracy that succeeded it. In any case, I understand it is the same people.
There are tremendous centralizing forces in large organizations. I do not care if one is talking about the Public Service of Canada, B.C., Saskatchewan or Quebec; there are tremendous forces at work that tend to make not only senior level people, but middle level people as well, gravitate toward the centre. Left to their own devices, the normal behavior of a large organization is to centralize.
Successive governments have had as a policy goal a wish, on behalf of the people everywhere in the territory - and especially a Legislature that has had a rural majority for all of its history - to share power and redistribute and also see a fairer share of the allocation of government jobs among the communities of the Yukon, as this government has.
I make no apology for this confession, but it is a fact that, having tried in a gentle ad hoc way for a while to achieve decentralization by issuing - I will not say decrees - policy direction that we wished it to happen, we discovered that even when the Department of Economic Development, for example, would create a job in Watson Lake, in the meantime, there were two other jobs created in Whitehorse. In that way, the net gain for rural Yukon was lost. Even departments that were heavily represented in rural Yukon, such as Education and Community and Transportation Services, were still not immune from the centralizing tendencies of their management.
The point I am making is that, as politicians, we discovered we had to take very decisive action to achieve decentralization and not just simply say that you wished it to be done. We could not simply ask for proposals, either.
Members of this House will recall that we asked for proposals from the departments in our first term. We went through a very extensive process and, for the reasons I have just explained, the departments volunteered very little in the way of ideas to achieve decentralization. It was only when a policy decision was made by this government - that we had to set targets for decentralization and have a multi-year plan with specific objectives - that we were able to give such clear direction to the public service that they were then able to respond by saying that is the clearly articulated goal, we can now respond with certain proposals and cost and evaluate.
I come back now to the role of the Deputy Ministers Review committee - that stellar group that includes many excellent people. In passing, I want to say to the Member for Porter Creek East, who made comment on their qualifications a few days ago, that they really are exceedingly good people. I would not want to say to him that someone with a Ph.D. in sociology, who taught at Rutgers, is in fact not qualified to be a social worker, nor does training in sociology constitute social work training. Because someone newly arrived in the territory made a mistake in their directions and, in a good-humoured and good-natured way, admitted it in public, they should not be vilified forever or have the excellent qualifications that she brings to the job of Deputy Minister of Tourism put into question for ever and a day.
With reference to one final gentleman the Member for Porter Creek East slighted, he is a public servant whom I admire enormously. Long before he had a brief career in public life, he spent many years as a Deputy Minister and was an extremely well-qualified and talented public servant. I regret only that the Member opposite has not had a chance to know his fellow Celt. This gentleman, apart from being a Rhodes scholar and, in his absence, having been appointed to head his department of economics at the University from which he is on leave, is in my opinion one of the most outstanding public servants I have ever met in my life - not only in terms of the quality of his advice but the speed, energy and intelligence he brings to all the projects in which he has been engaged. The Member opposite will not mind if I say that this person, as he put it to me, has suffered much worse at the hands of politicians and did not feel slighted at all.
I do want the Member from Porter Creek to know that there are other people in the public service who are a little more sensitive. I just pass that on to him.
Going back to the Deputy Ministers Review Committee, this is a very important body, and the most senior group of managers who can give us advice on decentralization, and that device is very, very important. The departmental plans and associated recommendations are reviewed and, after they have been considered by the Deputy Ministers Review Committee, by the Management Board and finally by Cabinet, which, of course, has to make the final decisions regarding the decentralization plans, so they can be articulated in policy statements before this House and in the budgets that are now before the Committee of this House.
Mr. Speaker, I do not want to overstimulate you by the energy and assertiveness by which I enter this debate, but I do want to try and make this point as clearly as I can. The planning and review process that I have just outlined is not a haphazard one. It is a considered process: one, founded on policy; two, guided by the goals and priorities of this government and by interests of Yukon citizens, particularly those in rural communities; and three, they are tempered by the practical considerations that constrain us to deliver our plans with operational and financial effectiveness.
We on this side of the House, have confidence in this decentralization planning process and we have confidence in the results. We are ready to answer questions that arise during debates on spending, relating to decentralization and we will continue to do so.
As I suggested earlier, we have further reasons for being quite at ease with any opportunity to debate the financial implications of decentralization. In fact, I approach such debates with a song in my heart, serene in the knowledge that what we are doing is the right thing for Yukon society and the right thing for the economies of rural Yukon.
The second point is that we see the expenditures related to decentralization as a worthy and effective investment in the economic futures of rural Yukoners. We think they make good financial sense and good economic sense.
I want to ask critics in all seriousness - because I know that many Members opposite, this unfortunate debate having been started, will want to participate - and I want to particularly ask the Member for Hootalinqua, who said some really unkind and cutting things about decentralization in a previous debate, and he could probably tell at the time that I was quite wounded, to put a rhetorical question to him, that I hope he will answer in the debate, and that is this: who would question the value of this investment; who would doubt the quality of this investment in rural Yukon; who would suggest that, given the opportunities available to us, and given the models of decentralization that have been tried in this country, that there is a better way?
I say to the Member for Hootalinqua - and I look forward to hearing his observations in this debate - that we have had the opportunity - the advantage, if you like - of having studied every other decentralization initiative in the country. That is not to say, at all, that we have not had some problems in implementing ours, and I will speak frankly about them later in the debate when I have the occasion. I have quite a lot to cover before I get to that. I do want to deal frankly with those problems and I hope that I have an attentive audience when we get to dealing with those matters.
I want to remind the House, as I did the Members for Porter Creek East and Hootalinqua a week ago, that our record shows that for many years all sides have expressed support for the idea of decentralization, no matter how difficult it was to achieve. Why? For the same reason that individual Yukon citizens supported the idea during the Yukon 2000 consultation: because the potential benefits of decentralization are so apparent to citizens and politicians of all stripes, even the new, exotic stripes that are emerging - you might say they are polka dots and checks, rather than stripes.
Whatever exotic foliage is being displayed by politicians in the territory now, I believe that, in the end, only the most grotesque Stalinist, most dictatorial personality, most radical libertarian, would suggest that we do anything other than try and share the jobs and benefits of those jobs, fairly in the Yukon community.
The potential benefits are manifold. For each public service position that is decentralized, the actual benefits vary depending on the individual circumstances, but in every case one benefit to the local economy is a given, that is, the value and steadiness of a government paycheque that is associated with the position.
Comparatively speaking, this is a paycheque that is less subject to the whims of world markets, metal prices, exchange rates, fluctuations in the tourism sector, or the vagaries of other resource sectors. It is not so subject to the whims of interest rates that hinder private sector investment, nor to other kinds of external factors in the world and national economies that have historically had such an impact on the small local economies of our rural communities.
Let me make a point that I hope will be supported by all sides of this House. No matter how difficult circumstances have become in the past of the Yukon economy, the one thing the last recession showed us was that the stability of the tourism sector was a big contributor. Even if the tourism sector had suffered terribly at the same time as the resources sector was down, we still would have had the virtue, the benefit, the stabilizing effect of public-sector spending in the Yukon.
That stabilizing effect should be felt not only in Whitehorse; it should be felt in Haines Junction, in Watson Lake, in Dawson City, in Old Crow and in Pelly Crossing. It should be felt everywhere in the Yukon. One way to do that - one very good way to do that - is through decentralization.
There may be some Members who will wonder where my speech is going to go from here. Others may not care.
The value of a steady paycheque to a local economy is very important in rural Yukon. The increased spending power, which converts into support for local businesses, stimulates further business activity and strengthens the private sector locally.
I have been at hundreds and hundreds of meetings in rural Yukon. I suppose it is thousands now as I have been around so long. From all those conversations, whether they were in Watson Lake at the time we got involved in the sawmill operation - whatever we may regret - I had people coming up to me saying, Thank God, you are doing something. We have been crying out for help and we wish there was something else. Thank God, you are doing something because we will get our bills paid now.
Whatever else you might say about the government getting involved in that, the one thing about the government being involved in anything is - I know that people sometimes complain about late payments - that governments in this country - not every country - pay their bills. That is very important. They also pay their employees.
In small communities, perhaps not Watson Lake, Dawson City or Faro, but certainly in the small communities, a new family coming to town with a government paycheque and a new government job creates quite an impact. The purchasing power represented by that government paycheque and the spending by that family in the local grocery store, in the local gas station and in the other areas in which they spend locally, makes an enormous difference.
Most of us in this House have some experience with small communities. We know that one family can make a big difference to the life of a small community, not just in the way in which they may contribute to coaching in minor hockey or ball in the summer, or by becoming a cub or guide leader.
In a thousand ways, the stability that contributes to the community, of having one more steady paycheque makes a difference to that person and family, and also to every business in the community. I know, as a former resident of small communities in the Yukon, a little bit about community life here. I know of the situation where if one can get one, two or four paycheques into a community, it makes a big difference. An example is the community of the Member for Tatchun, Pelly Crossing. A couple of jobs in a community like that make a real difference. They can be felt, seen and manifested in all sorts of ways. It takes a larger number to make an impact in a Watson Lake, a Dawson or a Faro, but the impact is real there, too.
It was interesting that in the background material provided by the advisory committee on decentralization, there was some material included by former Commissioner, James Smith, who we were very honoured to have chair that committee. He quoted from some American articles and publications about the sustainability of certain communities. He suggested that, as I recall, small communities everywhere in North America had to be a minimum size to be really sustainable - he was actually proposing a system of regional centres that was not, as it turned out, popular everywhere in the Yukon.
The idea of sustainability, however, was a very important one. He suggested that even the Watson Lakes, the Dawsons and the Faros, which have prospered recently and have grown, may be slightly below sustainable levels. It was not until the town got to be the size of about 3,000 people, that it might be said that it could really stand on its own and provide enough services to its local people that they would not have to come to, for example, a Whitehorse, when they needed dentistry, doctoring, certain kinds of food, social services, clothing or other services.
I am not a demographer or geographer and I do not have any training in urban economics beyond one fascinating course I took in statistics back in my fourth year of university, which I am sure you would love to hear about. I will not discuss it today.
The point remains that the value of potential spin-off benefits from decentralization is considerable. Whether it is from the rental or construction of office space, rental or construction of housing, or local purchasing under the new Government Services initiatives that supports the same, or whether it is benefits that indirectly support the local economy by encouraging local residents to stay and others to relocate to rural communities. It provides the opportunity for local residents to live and work in their communities and it provides better service delivery to rural Yukon communities that benefit everyone, not only providing opportunities for the service providers, but also for the consumers of those services in the territory.
For all of these reasons, I passionately believe that decentralization is a warranted, and potentially a very effective investment in rural Yukon communities, for every dollar spent on decentralization is an investment in their healthy futures. I believe that with my heart and my mind.
The third reason that I am comfortable and happy to debate decentralization here or anywhere else in the territory, is that I think that we can show positive results from what we have done.
Remember that we are still in the first year of implementing this policy. One has to keep that in mind. It is the first year of phase 1, which is a three-year program designed to move a hundred positions to rural Yukon and hopefully, bring us closer to the rural Yukon having a fair share of Yukon government positions.
As I speak, 24 of the 39 positions in year one are currently in place. Nineteen of those 24 positions are occupied by local residents. I will get into this later, but that means that we did not have to build or buy houses locally. We did not have to make special arrangements, because the positions came open to local residents, because we did not force citizens of Whitehorse to move where they did not want to.
There have been relatively few problems of late. Yes, we had a problem in Carcross, and yes, we had a problem in Haines Junction, and I will speak about those, as will my colleagues. However, in the end, I believe we can say there have been relatively few problems to date, despite the potential for problems in initiating a project of this magnitude.
As I said before, representatives of the public service union and the government employees union have publicly described the Yukon governments initiative as being the most humane in the country. This is in sharp contrast to the situation in Saskatchewan where we believe - and employees and Saskatchewan residents believe - that what was an insensitive policy resulted in the demise of that initiative. By comparison, our initiative is not sacrificing the interests of public service employees in order to meet those of rural Yukon citizens. For that reason, it is succeeding. We are not setting the employees against the rural communities; we hope we are serving the interests of both.
The advantage we have is that not only were we able to study what other people have done, but we also had the benefit of advice we got from the Decentralization Advisory Committee and all the people with whom we spoke in developing this proposal.
For this reason, as I have said before, I believe that the production of papers called for in this motion is totally unnecessary. The place for consideration of the financial implications of decentralization is in the budget debates, and I believe this is the process that will best serve the public interest; therefore, as I have said before, we cannot agree that this motion is timely at all.
Unfortunately, I am forced to deal with the motion as it is written, not for the reasons behind it. I think the reasons behind the motion are not admirable. I think the reasons behind the motion last week and this week were to usurp the time of the Private Members of the two largest parties in this House, and I regard that as regrettable, because I was very much looking forward to debating other matters that had been listed on the Order Paper by Members opposite, including some quite unwarranted attacks on the government, but we would have welcomed an opportunity to respond.
Mr. Speaker, you may feel I am coming to the end of my speech, but if you do, you are wrong because there are a few facts that have been put on the record in the past but which have clearly been forgotten by the mover of the motion; therefore, I would like an opportunity to briefly review some of that information, to make sure it is on the record once again and available to all Members of this House and, indeed, the public including those people who are not able to be with us for this debate but may wish to check the record.
For people who are especially interested and are prepared to demonstrate that interest in some tangible physical way, my office might even be prepared to provide a colour-coded copy of the speech - perhaps a pretty coloured file.
Again, for the record, year 2 of the decentralization initiative constitutes an investment in community economies and better public services. It adds 37 jobs to the year 1 initiative to give us a total of 76 positions or jobs in years 1 and 2. It includes and reflects constructive input from communities through meetings with Ministers and officials. I remind Members that nine communities will receive at least one job in year 2 and that year 1 implementation process is proceeding, despite the complexity of the task.
Let me just make sure that I have not missed anything. Note that I mentioned that there were 37 positions in the year 2 plan, 29 of these positions are full-time and eight part-time. As I said there are a total of 76 jobs in years 1 and 2, 39 in year 1 and 37 in year 2. These 76 jobs are equivalent to more than 60 full-time public service positions. Nine communities receive at least one job each in year 2. Dawson City, Faro and Watson Lake receive nine each in year 2. I am sure that the Members representing those constituencies will be expressing their appreciation for this government initiative when their chance to speak in this debate comes.
Positions going to each community in year 2 are as follows: Carcross, two; Carmacks, two; Dawson City, nine; Destruction Bay, one; Faro, nine; Haines Junction, three; Mayo, one; Ross River, one; Watson Lake, nine.
I believe that the record will show that the community of Haines Junction, in per capita terms, has done very well under decentralization, probably better than any other rural community so far, though it is important for me to point out that we hope to achieve, at the end of this process, a fair distribution. I certainly will look forward to hearing from the Member for Kluane during this debate to express his enthusiasm for decentralization. I know that he was not an early fan, but I hope that, as he sees the benefits to his community from this process, he will be increasingly won over and wish to express his appreciation and enthusiasm for this project when his chance to enter the debate arrives.
Questions have been asked about the number of employees affected by year 2 plans. Careful planning by departments has resulted in relatively few employees being affected by the year 2 plans. As I understand it, seven year 2 positions involve incumbent employees who are being asked to consider relocating to rural communities. Five are unique positions involving specific individuals. Two are positions in work groups of similar positions, from which one position will ultimately be identified by an employee volunteering to relocate, by attrition in the work force or, if necessary, by a process to be determined in consultation with the employees in the work group.
The remaining 30 positions are now, or will be, vacant when they are relocated and will go to recruitment - that is 22 positions - or are already located in rural Yukon and will be expanded with two positions or have already been relocated - in other words, have gone to recruitment and been filled by local residents, which is the case with five positions - or where people have been recruited with the understanding that the position will be relocated and are working in Whitehorse pending that move, which is the case with one position.
I know the Member for Hootalinqua will be fascinated to learn - if he does not already know - that there are two positions going to Carcross: one is full-time and one part-time. They are a southern region park superintendent and a field services clerk, which is the part-time position.
I know the Member for Tatchun will appreciate knowing that there are two positions going to Carmacks. Both positions are full time. One is from the Community and Transportation Services engineering branch. It is a rod-chain person, a seasonal full-time position. The other is from Education and is a coordinator of native curriculum development.
Members will know that the village council has said that Carmacks would be a good central location for decentralization positions because it is at the junction of two major highways. I know that Carmacks is very much hoping that, in the years to come, the centrality of its location may give it certain advantages in terms of the emerging economies, both in the public and private sectors, which it will be able to profit from.
As I said, there are nine positions going to Dawson City. These are eight full-time positions and one part-time position. From the Community and Transportation Services, lands branch, there will be a community planning coordinator, full time, and from the same departments mechanical operations unit there will be a full-time mechanic for the main seven- or eight-month season. This, I understand, is a local hire. There will be a full-time parts person. From Economic Development there will be a financial project officer working full time to help stimulate and develop the local economy there. From Government Services there will be a computer resource centre application specialist, full time, and a regional services clerk, part time. I understand a local person has already been hired for this position. A building maintenance tradesperson will be full time. There will be, as well, from the Public Service Commission, a personnel officer, located for the first time in history outside of Whitehorse. We think this is an historic and very important and commendable initiative. From Renewable Resources, there will be a north region parks superintendent trainee and this will be a full-time position. The idea is that the trainee, upon completion of the training, will move up in the departments hierarchy.
The year 2 position going to Destruction Bay: there is a total of one full-time position from Community and Transportation Services, and that is a soils technician, full-time, seasonal, for seven or eight months each year.
The year 2 positions going to Faro include: from Community and Transportation Services, a full-time community operations advisor; from Community and Transportation Services transportation engineering, a full-time, seasonal rod chain person; from Community and Transportation Services transportation maintenance, a full-time driver trainer. A number of suggestions we made there have followed from suggestions from the local town council.
From Health and Society Services, there will be a full-time substance abuse worker - again, I think this follows a suggestion from the town council in Faro - and a full-time social worker. The full-time social worker is, I understand, enthusiastically supported by the town.
From Justice, the justice services division, there is a full-time mine rescue superintendent located there and a full-time justice services intake worker. Again, the town council had looked to us to provide some court services personnel, and we have tried to respond as well as we could to their proposal. From Renewable Resources, there is also a part-time field services clerk, and from the Workers Compensation Board a part-time support intake worker.
I know there are bound to be some people who will ask what will happen to the Faro positions if it came to pass that the mine shuts down. I would like to say that this government continues to believe in the long-term future of the community of Faro, just as it did when it worked so hard to support the reopening of the mine. That is why Faro will receive nine positions in year 2 of decentralization.
We do know that office space and housing are in short supply in Faro. We will have to deal with this challenge as we implement the program.
Year 2 positions that are going to Haines Junction are as follows: for the season, there is a survey crew chief from Community and Transportation Services, engineering branch. The village council has asked for a new position in highways. We were not able to give them a highway superintendent at this time, but we hope that this will help meet the needs of that community. From Renewable Resources there will be a full-time western region parks superintendent. This, again, is in response to the local leadership who asked for positions that would help develop the land and resource-based economy around there. They also asked specifically for personnel of the parks and resources regional planning branch. In addition, a part-time field services clerk will also go to Haines Junction.
There is one part-time position going to Mayo. This is a support survey researcher for the Bureau of Statistics. This position is an on-call, auxiliary position in connection with the new labour force survey that has recently come into place. It is a project that we are very proud of and one that will start to give us a measure of the employment and unemployment in the Yukon, consistent with the national norms. It will also make us part of the national profile.
There is a part-time position going to Ross River, also with the Bureau of Statistics.
I know the Member for Watson Lake would not want me to conclude this list without mentioning the positions that are going to Watson Lake. I would like to say a word or two about that now.
There are a total of nine positions, eight full-time and one part-time position from Community and Transportation Services engineering. There will be a junior inspector, a survey crew chief, a soils technician, two rod chain persons. All five of these positions are seasonal, full time.
The town council has asked for regional transportation planning positions in areas such as highway design, upgrading and engineering. These are related positions and we have tried to respond as best as we can to the wishes of the town council.
From the Department of Finance, we contemplate having a revenue services clerk located in Watson Lake. The Member will understand that Finance is one of those departments that is very difficult to decentralize, but we are making an effort here. In this respect, we, the Department of Finance and the community of Watson Lake are doing pioneering work. I hope that will be recognized by the Member when he speaks in this debate.
From Government Services, there will be a regional services clerk, part time. I understand that local recruitment is underway. There will be a building maintenance tradesperson, full time, and from Health and Social Services, a continuing care and rehabilitation coordinator, full time. I know this is not exactly what the Member for Watson Lake has been seeking, but I do hope that this will meet the real, immediate needs of the people in the area, particularly aging people who require this kind of support.
As I said, significant progress has been made in the first six months of the implementation, particularly given the complexity and scale of the undertaking. As of mid-October, halfway through year 1, 22 of the 39 positions were in place in 11 of the 12 target communities slated to receive jobs in the first year. Of the 22 positions, 19 are occupied by local residents; 20 positions went to territory-wide recruitment, resulting in 18 local community residents being hired and all 20 positions were filled by Yukon residents. I know Members opposite will be pleased to hear that. One existing employee in a rural community had a half-time job expanded to full time, and one incumbent employee relocated to a rural community within his position.
Ten more year 1 positions will be relocated once work space is available in the target communities. Four of them are in the Community and Transportation Services communications branch, for which office space is expected to be available in Carcross early in the new year. Five are in the Community and Transportation Services aviation and marine branch, which will move to Haines Junction once the terminal building has been constructed, which I understand will be at the end of next summer. The remaining seven positions are either under recruitment or will go to recruitment shortly.
Decentralization of the 39 positions included in the year one plan officially began only on April 1, 1991. Some year 1 positions were located outside Whitehorse before the end of the 1990-91 fiscal year. Of the incumbent employees who were affected by year 1 plans and chose not to relocate with their positions, five have been found replacement positions in Whitehorse, one is temporarily assigned to special projects in his department while a replacement position is being found, two have retired and two are still occupying their positions in Whitehorse, as the positions have not been relocated.
If I could, I want to informally test the will of the House as to how much detail they want me to go into on the question of office space lease in Carcross, especially the proposed lease for the Carcross/Tagish First Nation Communications Branch, or whether Members would like me to try and summarize, or precis, this information. I am entirely at the will of the House, because I sincerely want to respond to the information needs of all Members in this area, and I want to make sure that I leave no stone unturned or turn unstoned, as I see here.
I believe it is public knowledge that the lease with the Carcross/Tagish First Nation was terminated by the government on the grounds that the lessor was in default, due to the failure to provide access to the leased premises. It is also public information that the department involved has met with the second low bidder, who is beginning to make arrangements to provide space for the government to occupy early in the new year.
I do have some more detailed notes than that, but I understand there is no enthusiasm for me to get into that subject at this time, especially on this side of the House.
The question of the office space in Haines Junction has been extensively massaged by the Member for Kluane and the Member for Faro in a previous debate and I would contribute nothing by adding to the discussions that have already taken place. Suffice it to say that we did have a delay there; we had a problem that we tried to address with the council - not entirely to the satisfaction of the Member for Kluane, who would have rather had us pay more territorial dollars in order to create space downtown. I still hope and pray - because I love the old gent dearly - that we can make him happy yet. Perhaps I will not be able to do that today, but in the end decentralization will prove a benefit to his community and I hope he will come to see that.
The costs associated with decentralizing public service jobs, in our view, constitute a reasonable and sound investment in the economies of rural Yukon communities. Decentralization will generate spinoff benefits to community economies and will benefit the Yukon economy as a whole. Decentralization costs are the additional costs of having a public service job in rural Yukon rather than in Whitehorse. The costs of the year 2 decentralization are reflected in the budget for the fiscal year 1992-93 before the House. The year 1 decentralization costs of 31 jobs are about $479,000, of which one-time capital costs are $225,000. Generally speaking, the extra costs of locating a public service job in a rural community instead of Whitehorse may include such things as one-time costs for: relocating staff, furniture and equipment; purchase of furniture, equipment or vehicles; renovation of office space or construction of new space; increased operating costs for such expenses as communication, travel, vehicle maintenance, et cetera; and increased personnel costs for benefits provided to rural employees under their collective agreement.
Now, as we have said about office space before, existing office space will be used, where it is available and cost effective. The government will call for proposals for office space to be provided by the private sector, if needs cannot be met with existing space. The government will invite community representatives to comment on the approach to office space being taken in the communities. The decentralization coordinator and the Government Services official will be available to meet with community representatives to discuss how office space needs will be met in their communities.
Of course, the issue for housing for decentralization needs will be dealt with on a community basis, given that, in some instances, employees will be hired from the community - in a majority of instances, actually - who already have housing. In other instances, employees may choose to provide their own housing through purchase, construction or rental from the private sector. The Yukon Housing Corporation will of course continue to offer staff housing units to YTG employees in communities outside of Whitehorse. Cabinet has requested that the Yukon Development Corporation review its staff housing policies, to make sure that they facilitate decentralization and that is being done.
From time to time, the question has been asked: why do we not decentralize whole departments? Why do we not, for example, send the whole of Community and Transportation Services to Watson Lake, or the whole of the Department of Education to Mayo? Well, most people who think about it for a minute will understand that we could not do that, that it would not work. You cannot have a public service operating entirely at odds with the shape and the direction and the locus of the Yukon economy. You cannot put your teachers other than where the schools and students are. You cannot put your highways employees anywhere else than where the roads are; it would not make any sense.
We have considered decentralization of whole departments and have concluded that it is not in the best interests of government or the community of Yukon citizens, because it would not enable the benefits of decentralization to be distributed fairly throughout rural Yukon. It would reduce access to decentralized departments for the majority of Yukon citizens, thereby reducing the level of government services available to them. It would impede the flow of communications necessary to the efficient operation of the government as a whole. It would place an onerous burden on target communities and would delay the flow of decentralization benefits to them, as no rural community currently has enough infrastructure or capacity to accommodate an entire department, even a small one.
I want to say something about the most notorious decentralization program in the country, which is the one in Saskatchewan, although one would freely admit there have been problems in Manitoba, Ontario and other provinces as well. Saskatchewan has had a lot of public attention. Ours are very different from those of Saskatchewan for some very basic reasons.
The Saskatchewan proposal wanted to move people, as well as public service jobs, to boost declining rural economies. Our difference is that we are moving jobs, not people. Our rural population, unlike Saskatchewans, is keeping pace with the growth of population in Whitehorse.
Also, the Saskatchewan proposal is very different from ours in that it is not providing comparable job security protection for affected employees. They are meeting resistance from the public service. We are doing our best to ensure that affected employees will continue to have employment in Whitehorse in positions at the same level of pay if they choose not to relocate.
We hope that, at the end of phase 1 of the decentralization process - the end of three years - we will be able to take a look at this plan and see how close we are to having the proportion of government jobs in rural Yukon reflect the proportion of the Yukon population that is rural. At the end of the three years, we will take a hard look to see how much further we have to go, and talk about what needs to be done in phase 2: what we have learned from phase 1, how we will proceed, what the costs and benefits will be. We will then have the advantage of experience in Haines Junction and Carcross, as well as successful experiences elsewhere.
We will have the benefit of being able to talk to the local councillors, First Nations, unions and chambers of commerce. We are doing that as we implement this program. There will be criticisms about the individual choices of jobs, departments, communities and locations. We know that, and it would be impossible to do it otherwise.
However, I want to say that we sincerely believe that this is the right thing to do. Equally sincerely, we believe we have been providing the information that has been asked for by Members here. We have provided the policy context, costs, detail and, if it is necessary for me to get up and give another speech as long as this in order to again convey the information to the Members in the House who are asking for it, I will be more than pleased to do so.
At this point, I want to say that I think this motion before us today is extremely illtimed. I, for one, would have much rather used the debating time this afternoon in the House for some other, more useful, purpose.
Mr. Brewster: I had not really intended to speak on this motion. There are a number of reasons for that. One of my main reasons is my extreme displeasure at how this Legislature has been obstructed in every move it makes to get on with business. Before we talk on the decentralization of government, we had better clean up our act in the Legislature and the deplorable way some Members are showing disrespect to the Speaker and the staff, who cannot reply to the charges.
Instead of sitting down and settling the issue that can be settled - not all of them favourable to all people in this House, but a compromise for all - certain Members of this House spend all their time acting for the press, insulting other legislative people in this House and just making a farce of the Legislature.
It is also not acceptable to the people on the street, when this kind of thing goes on. It also brings more disrespect to politicians. I do not think there is any politician or MLA who can say that we do not get enough disrespect from our citizens on the street so that we need more of it in the Legislature.
I will now get down to the motion. I find it rather ironic that the government speaks about decentralization. I remember on one occasion in this Legislature trying violently to get the superintendent of the north highway to be put into Destruction Bay, because this community was depending on tourism and had nothing else. This was voted down by this very same government. Perhaps that was because it was my idea and not theirs. Perhaps they got their idea from me.
I can see they are looking at me in disbelief. Look in Hansard. It is there and I can tell you who voted against it.
I also find it ironic that the Government Leader keeps talking about Haines Junction and pointing to me. I happen to represent Kluane and not only Haines Junction. I wish that they would get this straight in their heads, that I do not only represent Haines Junction, I represent the Kluane area.
I am of two minds on decentralization. Number one is that I agree that the government has to be decentralized; I have no problem with that at all. But it appears to me, like any other scheme, once it gets started, and the steamroller is going, the taxpayers at the end of the system are going to pay an awful lot of the shot for this. However, I could be wrong and time will tell.
I am a little concerned that so often we find that some of their staff is not moving out of Whitehorse and that they are rehiring. I have no problem with this if they are rehiring in the local areas, but all that we are doing is increasing staff. These other people, and rightly so, have to have jobs in Whitehorse so there is an increase and the number of staff goes up. I have no argument with the fact that all of the little communities need help and they need work for their people; I have no argument with that at all. I am also concerned that in some places two people are doing the same job, theoretically, or they are going to transfer them to another office in this building, so the staff has gone up. We have gone out and hired a bunch more staff in the communities and created other, more or less, departments of their own.
The one thing that I think is going to happen, in fact, I would bet on it, is that the people who are supposed to be transferred to communities close to Whitehorse, will continue to live in Whitehorse and will commute back and forth and keep their homes here. What they will gain from that, I do not know.
I am also hearing another complaint. Every one of these people that they send out to the communities takes a job from a private individual who is trying to work in business. This is only part of his job. The rest he is trying to do privately, but this also helps him keep alive. Some of these businesses are just going to have to fold up.
You will have successfully brainwashed the people of the Yukon. When I go to meetings they actually say to me, You are going to have to bring the government in. That is the only way we are going to survive. If the only way we are going to survive in the Yukon is by having a bunch more government employees, then we are in an awful poor state.
I see and I hear this attitude from people all the time. The government will look after us and the government will transfer more people in. Yes, the payrolls help and the people do help the communities, I am not denying that. But, there is an existing attitude about where the private businessman can start. Prior to the transfers, the businessman had small contracts with the government. Now he is losing all these and he is folding up. Where is the businessman going to go from there?
Governments do not make nations and governments do not make communities. Business people and ordinary people make communities. Yes, they do need the backing of the government but the government should be in the background not in the foreground controlling everything. They should be in the background helping the communities. If our communities are all going to depend on government, and this is what is happening, then we will have a real, real problem here in the years to come.
Hon. Ms. Hayden: It is with considerable interest I join this debate.
With the exception of the Department of Education and probably Community and Transportation Services, I would venture to say that my portfolios of Health and Social Services and Yukon Housing play a very significant role in the decentralization of services to all communities across the territory.
I agree with the mover of this motion that decentralization is and will be an important issue over the next few years. I would go even further and say that decentralization of functions and responsibilities will be important to all Yukon people for decades to come. Where I disagree with the Member for Porter Creek West is in comparing our planned and humane decentralization program to that of the hasty program put together by the former government of Saskatchewan. That government seemed to show considerable disregard for the rights and feelings of their civil service.
In 1989, we said that we were going to decentralize and that we cared about decentralizing our programs. We have delivered, and will continue delivering, decentralization of government, but it will be done on a planned and humane basis. It is, and will be, done in a way that will meet the long-term economic and social needs of the community. It is, and will be, done in a manner that is properly planned and implemented.
The debate on decentralization has been with this Legislature for years. The difference is that this government has taken action and developed a three-year, phased-in program. We have developed a program of action that I hope will meet the communities needs, but not at the expense of losing good employees.
This is not just rhetoric. In the Department of Health and Social Services, we are responding to the needs of communities in a way that meets that need. For example, we are decentralizing two community support workers to the communities of Mayo and Watson Lake. These positions will be responsible for providing counselling and support to the elderly, as well as to individuals with mental, physical and multiple disabilities.
Workers will also be able to assist the communities in assessing their long-term needs and, more importantly, they will work with the communities to develop solutions that meet their cultural and community needs.
In Faro, as the Premier mentioned, we will be adding a substance abuse worker to assist that community and surrounding areas in coming to grips with the alcohol and drug abuse problem in their communities. This person will not only be able to provide counselling, but will also work with community resources to develop and implement substance abuse programming and education that meets the needs of the community they serve.
It is important that any of these programs be community-based, and that they be the programs the community wants.
These are not all of our decentralization initiatives; they are supplements to our already decentralized work force. We have regional offices in every major community in the territory, and we have local offices in each of the smaller communities. In total, we will have 25.4 person years employed and providing needed community services around the territory.
All of these people are doing their best to meet the health and social services needs of their community. Perhaps, just as important, is that they are located in those communities. They form part of the social fabric of the community; they are the baseball coaches, the mayors, the community association members and community workers. They join organizations to try to help the recreational, educational and housing needs of their community. They are contributors to, and part of, their local economy.
As the Premier mentioned in his opening address last week, relocation of jobs into communities is one way of supporting the development of more stable communities. Another way that this government is delivering on its promise of decentralization is through the devolution of services to the community level. Through our contribution agreement with the Yukon Family Services Association, it will be providing resident services in Watson Lake and Dawson City - soon, I hope, because I know the Member for Watson Lake keeps asking me when; I can tell him that I have signed the contract and I suggest he calls the association, rather than me, to find out when it is arriving in his community the next time.
These people will be providing publicly accessible counselling that runs the gamut from marriage counselling to counselling for survivors of abuse.
It will also provide the opportunity for employers in the area to establish employee assistance programs. In addition, I am told that the Yukon Family Services Association will be increasing their presence in communities that are close to Whitehorse. This will bring the services to the people, rather than having the people travel to the service.
Similar services are being provided by the Child Development Centre. This centre provides assessment services and counsel to parents on the development of their children. They achieve this through a part-time worker residing in Dawson City who travels as far as Pelly Crossing. In addition, they have an outreach team consisting of a speech pathologist and an assessment counsellor. Those are just two organizations that we support in our role of decentralizing services.
These programs in our communities will have long-range economic and social impacts. Yukon people said, through the Yukon 2000 process, that they needed economically strong and socially healthy communities, and that is what we are delivering through our decentralization and devolution of services and responsibilities.
As I mentioned at the start of my speech, I also have the responsibility for the Yukon Housing Corporation. As the corporation is responsible for delivering the staff housing for the government, it will play a pivotal role in the decentralization of government services. It must be remembered, however, that because we are bringing in decentralization on a humane basis, the corporation will have to react quickly, on an individual basis. Each community is different. Each of their housing needs is different. Each of the family needs of the employees who will be taking the jobs will be different.
As was seen in our first year of decentralization, the vast majority of jobs were filled by local personnel. This has meant that housing was not a problem for the majority of people. Generally, we cannot predict housing requirements until we know who will fill the positions, so the issue of housing for decentralization needs can only be dealt with on a community-by-community basis.
There are a large number of options to house decentralized employees. In some instances, employees will be hired from the community and they will already have housing. In many other instances, employees will be encouraged and may provide their own housing through purchase, construction or rental from the private sector. Yukon Housing Corporation programs will be available for this, on a priority basis. We want to encourage people to make a commitment to the community, by buying or building houses.
As departments identify their housing needs in each community, specific plans for each community will be established, in consultation with the community housing associations. There are several possibilities for meeting the needs of decentralized staff without building new staff housing. For example, local people are hired, in which case they already have housing; people can buy an existing house on the market, on their own; people can rent an existing house; builders could put up houses in anticipation of people moving, with Yukon Housing Corporation assistance, through the joint-venture program.
People could build their own house through the Yukon Housing Corporations owner-build program and they could have their own house built by a contractor and obtain a regular mortgage through the extended mortgage guarantee program or through our home owner program.
Some communities have vacant staff units or units rented to people who are not on staff and who could be moved out within one month. These units would be provided to decentralized staff.
Existing houses could be purchased by YHC to be used as staff housing.
We will be encouraging the private sector to respond to the staff housing needs through renting existing units or constructing new units for sale or rent, and by encouraging YTG staff to establish roots in the communities by purchasing or constructing a house. As a last resort, Yukon Housing Corporation will construct and rent housing units to meet the housing demand.
In conclusion, our decentralization initiatives are being planned and implemented to meet the community needs, not simply a movement of government offices to other places. We are delivering and will continue to deliver well-planned and well-managed programs that will meet the needs of Yukon people.
Mr. Lang: I would like to make a number of observations on the question of the decentralization policy, but first of all I would like to say, for the record, that I feel it is a sorry day when, on Private Members Day, we debate in the manner that we are because of the conduct of a number of Members of the House. I cannot recall, during the time I have spent in this House, when the rules of the House have been so blatantly misused or abused in order to try to reach a personal end.
I recognize the fact that I have served both as an independent in this House and as a member of a political party is, to some people, of no consequence; perhaps that is so, but as a long-time Member of the House, I can speak with some authority on how the House has always proceeded. In most cases, it has always been in a gentlemanly manner, respecting the right of the government to put forward their case and their program in a logical and legitimate fashion. Just as importantly, on Private Members Day, Members should be permitted to put forward issues in a very logical and sequential manner.
The irony of the situation is that the Members of whom we speak have consistently abused the rules since we began sitting. Their case is to be dealt with, according to the rules of the House, through the Standing Committee on Rules, Elections and Privileges. However, from most Members points of view - or at least from my own, as I voiced it at that particular meeting - we were stonewalled there, as well. That was the forum for any Member or group of Members to bring forward ideas of how the rules should be changed, modified or deleted, if there are to be changes in the conduct of the House.
I share the concern of the Government Leader with respect to the fact that some Members are not prepared to recognize that precedents have been set through common sense and decency.
I think it takes away from the House when we get into a situation similar to that of the other day in the Standing Committee on Rules, Elections and Privileges. I, for one, was insulted verbally by one Member. I will point out that I never retorted, because I felt it was beneath me to reply to the particular statement the Member made. I think it does take away from the conduct of the House.
I want to go a little further on the conduct of the House, as I think it is important when discussing a motion of this kind. I think, however, in years past, there have been charges made on both sides and some were, perhaps, personal, but in terms of the overall running of the House, it can be said that this Legislature, up until a couple of weeks ago, compared to other Legislatures, has managed to maintain a degree of civility and manners most of the time.
I might add that it is very difficult at times, in the heat of debate. I can be an offender and I will express my regret at the times that I have, perhaps, become too emotionally charged in the course of debate. Perhaps, at times, it has become personal. Overall, I can say that we have, because of the small size of this House, managed in most part to disassociate ourselves from the antipathy that one sees generated in the Parliament of Canada on television, and from what you read and sometimes witness, if you have the opportunity of going to a Legislature like in the Province of British Columbia. It is with regret that I see this deteriorate, because the purpose of the Legislature is not for the purposes of the Member for Klondike to get on the front pages of the local astonisher every day, or for that matter the Member for Porter Creek West or the Member for Porter Creek East. The most important role that we have here is to express our opinions, bring forward the opinions of the constituents whom we represent and debate in a very logical and commonsense manner so that a definitive decision can be taken by the Legislature on behalf of the people of the territory.
The Legislature is not a place for the sole purpose grandstanding, nor is it for the purposes of presenting motions, or a series of motions, taking away from, or impinging on, the rights of others, and then prove beyond a doubt that the individuals were not interested in the issues to start with. If one is going to discuss and is interested in an issue, then I submit to all Members that one should have to take the responsibility of ensuring that they are present for the full debate.
In my case, I have absented myself a couple of times because of my back. I find it difficult to sit here for a continuous period of time. Anybody who does have a sore back or has had a sore back, at any time, I am sure will commiserate with me. I hope that it will go away with time. I am working on that.
I think it is important that we recognize that the order of the House has been intentionally disrupted. I think that is too bad, especially in view of the fact that the issue of party status has been taken seriously by yourself and by all sides of the House by being referred to a committee of this House to consider, to deliberate on and to report back to the House with some recommendations.
I want to register my concern, which is similar to that of the Member for Kluane. The Government Leader stated that they felt the rights of other Members were being impinged upon as we watch the attempt to alter the course of business in the House.
There are some important issues out there that should be discussed. One that comes to mind immediately is the question of the forestry industry, the future of the forest industry and what is going to happen in the community of Watson Lake and the surrounding area. Another that comes to mind, as brought forward by the Member for Kluane, is the question of the future of the Kluane National Park. What is the park going to do for his community and the young people growing up in that community? Is it going to promote some business and job opportunities for the people of that area?
That is the sad side of what has taken place here. It is unfortunate that some people feel that if the rules are not directed fully to their benefit then they must be changed to meet all their objectives, even against the will of the majority and the individual rights of other Members.
The question of decentralization is, I think, of concern to all sides of the House. I have to go on the record; I do not think that any Member, if you spoke to them privately or publicly, would say that they are opposed to decentralization or its principle. The question has to be: how are we decentralizing various aspects of government and how does decentralization relate to other elements in the economy? Our concern is whether or not the program that the Government Leader has announced is legitimate. Does it stand up to scrutiny and common sense? Is it of benefit to the territory and those communities and individuals who are affected?
There is another motion on the Order Paper, which I feel probably has more validity, and that is a motion that I submitted some time ago to refer the initiatives and proposed expenditures of the decentralization policy to the Public Accounts Committee. I think that is the logical forum for a good discussion of the details of the decentralization program and would provide a chance to delve into the actual costs of decentralization. The principle of that particular motion, which could have been debated today if the precedents in this House had been followed, is that maybe some constructive recommendations could come out of the Public Accounts Committee with the idea of bringing forward some principles that might well replace some of the ones that the government has already accepted, or modify some of them, in order to put a more realistic program into effect.
The decentralization policy announced last year was very hastily put together. All the information points to the fact that last fall we were due to go into a session, the government had committed itself to decentralization and, lo and behold, about a month prior to coming into the Legislature the government realized they did not have a clear policy or program to present to the Legislature. It was no secret that call letters went out to the deputy heads telling them to bring forward, by the time the Legislature started, recommendations of what could be decentralized. That is our concern. We know that the direction came about by the government awakening to the fact that it was coming into a sitting of the Legislature.
It is interesting to note that there is no mention in the decentralization policy of the fact that, in the City of Whitehorse, if there is going to be any less office space rented or utilized by the government because of the consequences of the decentralization policy. In fact, we are building more as we discuss the topic of decentralization.
If one examines, just in a cursory review, one can see that the main thrust of the decentralization policy is not to decentralize positions from the government from the City of Whitehorse, but to add, in most part, to the complement of the staff of Government of the Yukon overall.
We know, and the Minister knows, and it was made very clear last fall, that a good percentage - and I do not have those numbers in front me - of those positions going out to the communities were not filled, but they were going out to the communities in any event. In some cases these positions were being cost shared, if not paid for indirectly, in full, by the Government of Canada. That was done under the auspices of decentralization and the principle that the government could meet its political objective with the least amount of heat.
The Government Leader spoke of the situation in Saskatchewan and the proposed forced decentralization of government employees from, I believe, the cities of Regina and Saskatoon. We, quite frankly, share the Government Leaders point of view on the fact that that is not the way to go about decentralization. On the other hand, our concern is that the policy lacks the necessary criteria - from an objective point of view - to determine what should be decentralized, and what the cost benefit would be to the taxpayer in the community while providing a very effective way of delivering that service.
I want to use an example; let us look at the communications branch going to Carcross that eventually resulted in the Maurice-Doris Show. The decision to move that particular branch last year emanated from public meetings, and the observation has been made in many circles that the benefit of moving this branch, for either the community or the government, is really questionable.
The mandate of that particular program within the department is very broad. Travelling is obviously one of the major components of the job description of any particular employee. They have to go to all the various federal hearings, write briefs, be in constant and continuous communications with other provincial and federal governments in order to do the job and provide the necessary information for the government.
It seems to me that in the rush to try to decentralize, the now notorious Deputy Minister, who recommended this particular move, is now going to school at taxpayers expense and with the approbation of the government.
It is obvious that the move was made to meet the objectives I stated earlier, which was to present a program to the Legislature at any cost. The community, since that time - and I am sure the Member for Hootalinqua is going to speak on this - has seen some very difficult social situations arise within the community. We now have a recreation facility, which was used by the band, that is partially renovated for office space. We are now going to some other organization to provide that office space. Subsequently, the recreation facility is in limbo. It is neither an office complex nor a community centre any longer.
To be able to meet the demands of the community, now that they have seen the results of the hastily put together program, the Member for Faro, in his capacity as the Minister responsible for community affairs, comes forward with his proposal for long-term economic development for the community - he is going to build a community centre. We saw the sad results of his efforts in trying to patch up the situation. It was of his governments own making and he was left with the job of trying to do everything he could to cover up a situation that was of significant embarrassment to the government.
The question that comes into play, which I recognize the Minister responsible for housing spoke to, is implementation. For example, in their own report of the Advisory Committee on Decentralization, which was commissioned and brought forward by the former Commissioner, Jim Smith, and the recommendations of which, as far as I can make out, were not even read or followed. A number of different issues were raised that were of concern to us. We do not feel these have been adequately addressed. I think the Public Accounts Committee, within its mandate, could bring some recommendations forward to the government of how it should be implemented, if we are going to go ahead with decentralization.
On page 81-1, one of the recommendations for consideration prior to implementation was the review of the public works infrastructure of communities to establish if they can absorb large-scale expansion of office buildings, industrial buildings and employee housing.
A few minutes ago, I spoke of Carcross. The other one that comes to mind is Haines Junction and the fact that very little, if any, lead time was given to that community, and the employees are going to be working outside the community.
I would have thought that this might have been a vehicle, if the decentralization of this branch was to go to a community such as Haines Junction, where there might have been an opportunity for somebody to look at providing office space, not only on a long-term contract, but also from the point of view of providing a larger building so other types of businesses could be incorporated in it within the community of Haines Junction.
That was not considered, because that did not meet the political objectives of the government, which were to announce a policy of decentralization and, at any cost, to be seen to be doing something in a number of these communities.
There is the question of employee housing. The Member for Whitehorse South Centre, the Minister responsible for housing, and the Government Leader, proudly spoke about the fact that 39 jobs are projected to be decentralized in the year we are in, and 19 of them have been filled by local people. That is a record that one could say is successful, but that is not surprising because those positions were, in most part, new positions added to the government that were perhaps not filled last year.
The broader question here involves those employees who are going to be retired from the civil service here or transferred to those communities. As I have stated, there is not a vast number of them, but there are some. My concern is that in a number of these communities there is no private housing and no opportunity, really, to get private housing, unless the employee builds a house which, considering the misguided policies of the Yukon Housing Corporation, would be a very foolish thing to do, in view of the fact that the buy-back scheme for employees has not been updated. There is no incentive to build your own home.
As well, and more importantly, in most cases the private housing market in these small communities is virtually at a halt. I know that there are people in this room who have gone through the experience of trying to sell their home on the private market in a small community. Lo and behold, who buys the house? The Yukon Housing Corporation. Why? First of all, because nobody will build a house in some of these communities because of the fact that that is the biggest investment they can make, and they know that they are not going to be able to recover their investment or even break even.
What does that say about our communities, when you examine them from the point of view of stability? What does that tell us? People not owning their own homes, in most part, results in a very transient workforce, because it is very easy if all a person has to do is give 30 days notice before leaving. The ties to the community are then not very strong. I share the view of the Member for Kluane. I think the government does have a role in these communities and there are areas that can be decentralized. My concern is that the approach being taken is almost like a lottery. If one is nice to the Government Leader and nice to the front bench, there is a possibility, depending upon the decisions made in the hallowed chambers of the Cabinet room, of getting a government job in a rural community. It may not have much to do with the running of the community, but it is a paycheque. The Government Leader went to great lengths to tell us how important a government paycheque is in a community. I do not dispute that, but I do have problems with just putting positions in the communities for the sake of putting them in, without full consultation and some idea from the community as to what they see happening within their boundaries and also from the perspective of the program and the effectiveness of running the program. The Government Leader spoke of one example, and one I feel should be used as an example. There was an arbitrary decision made to transfer the native curriculum officer position, as the coordinator, to Carmacks.
As Members know, people directly affected by that program were asking why this particular position was being transferred to the community of Carmacks when it was needed to direct the whole program throughout the territory.
Nobody can tell me that the decision to decentralize that particular position was made in consultation with those directly affected by the program. Nobody in this House can convince me, or the general public, that it was the consequence of the good planning spoken of by the Government Leader. That goes back to the position and to the concern that we have in respect to the overall decentralization program.
There are two other elements that I do not think have been considered. One is the question of what responsibilities could the government devolve to a community, with the understanding that if that position has to do some work outside the community, that it would be done on a contractual basis on behalf of the Yukon territorial government. To my knowledge, that has not been looked at in any depth.
That would have gone in conjunction with devolution of authority to the municipalities. The municipalities are becoming more and more sophisticated. They are becoming more and more resourceful and are being granted the financial resources to do a number of things that YTG used to do. But, no. On one hand we devolve the authority to the municipalities but do not, through attrition and recognition of the employees and their rights, directly transfer some of the positions to municipalities along with the corresponding dollars.
That is one area where the program is perhaps delinquent to some degree. That is also one of the reasons why we recommended that it go to Public Accounts Committee, so it could be discussed among Members to see if some of those initiatives could be taken from that point of view.
As far as the full implementation of the decentralization program is concerned, it also seems to us that, through the courses of the implementation of the program, the government should also have considered the effect of transferring positions to a community in the private sector. That has not even been considered.
I have received reports from the community of Mayo that a good citizen, who worked in that community and coached hockey, is leaving Mayo. He was not a government employee but did a lot of contractual work with the government. In part, his decision to move out was based on the fact that, because of the decentralization plan, an employee was going to be taking at least a portion of his contractual work.
That criticism has also been leveled in the Teslin and Watson Lake communities, where people in the electrical trade had hired an individual on a part-time basis in both of those communities to do contract work with the government and then, of course, that individual who was employed and living in those communities is no longer employed. But, on paper we can say that we have created a position and we have sent someone down to Watson Lake.
It seems to me that the purpose for the decentralization program should not be to replace employees who are working with private businesses. The sad thing is, and it is my understanding, that the decentralization policy is those in existing positions - as is their right - have decided that they will commute to and from the job site.
Like the Member for Klondike who likes to commute...
Speaker: Order please. The time being 4:30 p.m., pursuant to Standing Order 11(7), the House will now proceed to Bills Other than Government Bills.
BILLS OTHER THAN GOVERNMENT BILLS
Clerk: Second Reading, Bill No. 102, standing in the name of Mr. Phillips.
Speaker: Is the hon. Member prepared to proceed with Item No. 1?
Mr. Phillips: Next sitting day, Mr. Speaker.
Bill No. 103: Second Reading
Clerk: Second Reading, Bill No. 103, standing in the name of the Hon. Mr. Phelps.
Speaker: Is the hon. Member prepared to proceed with Item No. 2?
Mr. Phelps: I move that Bill No. 103, entitled An Act to Amend the Yukon Development Corporation Act, be now read a second time.
Speaker: It has been moved by the Hon. Member for Hootalinqua that Bill No. 103, entitled An Act to Amend the Yukon Development Corporation Act, be now read a second time.
Mr. Phelps: It is not often that this Member has had to wait so long to be able to participate in debate on what is the Private Members Day for the Opposition. However, due to the strange occurrences in the House procedure, instigated by Members who are not always present when the meat of the matter is debated, this is my first chance to have a go at what is one of my favorite subjects.
Today is a particularly fine day for entering into debate with respect to the Yukon Development Corporation Act, and debate about the handling of the assets that were transferred to this government and, then, to the Yukon Energy Corporation - assets that formerly belonged to Northern Canada Power Commission, an agency of the federal government.
I say that because, as we all know, at this very time, even as I speak, there are hearings going on in another part of this fine city with regard to whether or not Yukon consumers are going to be faced with yet another rate increase in the amount charged to them for electrical energy.
It has been a bone of contention for us that we have seen the assets of NCPC devolved to the agency of the government - the Yukon Development Corporation, through its subsidiary, the Yukon Energy Corporation - on extremely favourable terms, assets that ought to have, and did, generate huge profits on behalf of the Yukon Energy Corporation.
It has been a bone of contention to see these profits siphoned off over the years by the parent company, the Yukon Development Corporation, and to see them used, in part, to pay for the losses of that corporation on ventures that are totally unrelated to the provision of low-cost electrical energy to Yukon consumers. It has also been a bone of contention to see the profits that were siphoned off from the Yukon Energy Corporation used for such questionable investments as the $2 million that was advanced to the convention centre/hotel complex that is going to be built shortly in the City of Whitehorse, and other monies spent on other studies prepared by the Yukon Development Corporation.
Our real purpose in bringing forward Bill No. 103, An Act to Amend the Yukon Development Corporation Act, is to require that the profits of the Yukon Energy Corporation be invested in the development and upgrading of the energy resource infrastructure, or in equalizing or reducing the cost of electrical energy to Yukon consumers. The reason for this is that we feel very strongly that the consumers of electrical energy in the Yukon should not be burdened with the rather hare-brained investment schemes that the Yukon Development Corporation is inclined to get into - schemes that are not related to the provision of energy to Yukoners and do not directly benefit the consumers of electrical energy, who in part are required to pay for them.
We have had several lengthy debates on this issue. On November 14, 1990, we debated a motion in these chambers that contained similar subject matter to the amendment proposed in this bill. At that time, I went through some of the books provided by the corporations in question. The stripping away of these profits is a simple matter of record. It is very clearly set forth in the books.
I refer to the Yukon Energy Corporation report for the year ended December 31, 1989. In 1988, the net income for the corporation was $9,595,000. Power rate relief subsidy payments were paid out to the tune of $1,342,000. For that year, this would have left $8.2 million or so of profits, but dividends were paid out to the parent corporation, the Yukon Development Corporation, and were in the sum of $8,615,000 - more money than the Yukon Energy Corporation made, particularly after the subsidy payments were made.
In the next year, the income was $5.5 million. It paid out $482,000 in power rate relief subsidy payments, yet $7.6 million was siphoned off by way of dividends into the parent corporation, the Yukon Development Corporation. So, they actually siphoned off more money than was made during that fiscal year - the calendar year that Yukon Energy Corporation reports on.
It is interesting to note that, in that year, the parent corporation very generously lent some money back - $5.5 million, in fact - to the Energy Corporation, at an interest rate of eleven and three-eighths percent. That debt, as of December 1990, at least, we can see remains on the books and Yukon Energy Corporation continues to pay interest at that rate on that $5.5 million.
What concerns us is not so much that money flows from a subsidiary corporation up to its parent corporation. What concerns us is that it is very clear that some of this money is not being held, almost in trust as it were, to be spent on the electrical consumers from whom the profit was earned. A lot of this money has gone into such things as the infamous Watson Lake sawmill debacle.
Over the past several years, during debates such as we are in today, Members of the side opposite have attempted to deny that any of the money was spent on, for example, the Watson Lake sawmill. When I go back to the debate on November 14, 1990, I said there, and I continue to maintain, that when the Yukon Development Corporation was formed, the working capital given to that corporation was less than $5 million.
There was other money invested, but it was all in capital. Since that time, the only source of revenue has been from the profits of the Yukon Energy Corporation. Yet, in that time, there were millions upon millions of dollars lost in the sawmill project, and we ended up in a situation, after the $16.2 million was siphoned off into the parent corporation, Yukon Development Corporation, where that corporation continued to have roughly the same working capital, plus a couple of million dollars. I am submitting that it can be easily ascertained that a large portion of the dividends paid went out to cover losses of the sawmill.
There are several reasons that we take umbrage at what has happened. The first reason is what we view as the scandalous way in which the NDP government has been using the Yukon Development Corporation as a political tool. That really bothers us. It bothers us even more when we realize that, not only is it being used for crass political motives and crass political objectives, but that money that is rightfully, in some way, held in trust - not legally, but surely morally - for Yukon energy consumers, is being siphoned away and used to further what we see as a political objective, because there is a sordid history, in our view, of the government being less than forthright regarding the success or failure of Yukon Development Corporation ventures.
You may recall that when the Watson Lake sawmill first started it was given a great send off. People were flown up from Watson Lake to hear the Government Leader give a statement in these Chambers with regard to the glowing future of the forest industry in Watson Lake.
The Watson Lake sawmill started up and the first year-end, audited report for the corporation was of course, in March, the first spring after the start-up of the mill under the Yukon Development Corporation. No one was told about how the operation was doing until about six months after the operating period when the books were closed off, and a considerable time after the reports were received by the government and the corporation from the accountants. What happened was that the operation had lost, I think, $1.8 million by March 31 of the first year.
I guess the government had an awful time trying to figure out how they were going to spring this on the people of the Yukon, so they waited and they waited, and then they came up with a great public relations plan. They hired a couple of planes and flew all of the press down to Watson Lake and announced that things were going great now. They fired everybody who was around there and hired new guys to come in and take over. While there was a slight setback in the first partial year of operation and they had lost $1.8 million by the end of March, things were going great now - I think it was October, six months later - things were going great now. They had new management and a bright future. Of course, by then they must have known that they were losing money hand over fist and things were not getting any better. So in January of 1989, we were suddenly told that, by golly, they were kind of tired of running this operation and they had somebody to sell it to. It was a really big outfit called Shieldings, - bankers, you know - and they were going to put up a brand-new, state-of-the-art $6 million mill. The government was going to be selling it to them, and everything looked wonderful for the future of Watson Lake and the investment seemed very, very secure.
Then they called an election. Strangely enough, it was not until the election was over and the deal was consummated - and it is true that this banking outfit was one of the purchasers, although a reluctant partner with a bunch of blue-chip investors from Howe Street in Vancouver. It was not until then that we realized that the loss for that year - April 1 of 1988 to March of 1989 - was a whopping $4.5 million.
Not only this, but because the prospective investors realized that the government was terrified and had to get rid of this at any cost, they could slip in there like sharks and make the best deal anyone has ever made since someone sold the Brooklyn bridge to a chap in from Missouri one day in the City of New York. We know things went from bad to worse. The point of all of this is simply to underline not the losses, but the way in which government tried to manipulate what was happening to a company owned by the people of the Yukon.
As if that was not bad enough, the problem is compounded by the fact that the government, again, prior to the election call in January of 1989, announced, on the letterhead of the Minister responsible for the Yukon Development Corporation at the time, that things were going really well and profits were great at the Yukon Development Corporation and the Yukon Energy Corporation - so great, in fact, that they were going to roll back the amount that the consumers of electricity were going to have to pay for a period commencing just after the election that was about to be announced.
What we had was what I see as a very crass political manoeuver, motivated not by what was best for the consumer of electricity, nor by what was best for the corporations themselves, but by what might help win what was going to be a very close election. The consumers did not realize they were going to have to pay for all this generosity, in the same way that most parents pay for the gifts that Santa leaves under the tree on Christmas morning for the kids. Some pay with credit cards, some go to the bank and borrow money, some budget ahead of time - put their money away in a Christmas fund - but most of the parents know that they have to pay for it out of their pockets. I hate to say this and reveal it right here in the House but, sad but true, there aint no Santa Claus.
I take umbrage at this kind of manipulation with not only the taxpayers money, but also with money generated from the electrical consumer of Yukon.
That is my next point.
We are also concerned about the lack of action with regard to developing sound energy policy for the Yukon, and with the lack of priority and attention paid to this extremely important infrastructure by this government ever since they took office. In our view, the negotiations for acquiring the assets took far longer than they ought to have taken - after all, the groundwork had been laid prior to the NDP taking office in 1985.
Back in those days, it was not a priority of government. In fact, I can recall the leader of the government being terribly upset because we had hired consultants and their contracts stood for a couple of months after the election was over. It took them a while to suddenly realize that this was a great opportunity, but unfortunately, they did not see it as an opportunity to to take a hands-on approach to ensuring that the energy infrastructure in Yukon could be used to encourage economic diversification in the territory. They really saw it as a gift - more money from Ottawa; bucks that could be spent and bucks that could be stripped away and used for the kinds of schemes that have been carried on with not much success in all of those eastern European countries where the governments have insisted on living under demand-side economics.
I am personally frustrated by the low priority that the Yukon Energy Corporation has given to the development of an energy infrastructure that is cheap and environmentally sound. Hydro projects should have been on the drawing boards and perhaps well into construction by now.
That should have been done by now to have reduced our ever-increasing dependence on diesel generation of electricity. Of course, we have just been told about the latest $2.3 million generator that has been installed in the plant at Whitehorse. The interesting thing, of course, in regard to diesel, is that it is not environmentally sound. In fact, this very same government that has been putting Yukoners on the needle for ever more injections of diesel-generated electricity and increasing the consumption of diesel fuel to generate electricity is the same government that has been spending money on radio ads telling people that they ought not drive their car or run their motors any more than necessary, and that they ought to have tune-ups so that they do not burn too much gasoline or diesel and pollute the environment.
The same government - a different department - up until very recently was bouncing merrily along its way, building housing units that were heated by electricity, when they knew that all new electrical demand in the territory was going to, of necessity, have to be met by diesel generation.
I realize that the new Minister, who I know is enjoying this part of the debate, takes these issues very seriously. Just today, in this House, he came forward with a Ministerial Statement on the the energy strategy, power smart ideas shop. I am sure that, given todays climate, and given the outrage expressed by most consumers of electricity and the fact that their largest customer is spending a considerable amount of money in appearing before the Public Utilities Board in its hearings and have been extremely critical of the way in which the government has handled the Yukon Energy Corporation. Because all these pressures and because the government realized at least one year ago, when it budgeted all this money to tell Yukoners about how serious an environmental issue the burning of fossil fuels is - and I know they have now made the connection between fossil fuels and diesel and that they are using diesel to generate electricity and to have more electricity, they would have to burn more diesel fuel - I think that in a couple of years they will probably get their act together and come out with a pretty good strategy - perhaps in eight or nine years, we will actually see some hydro on stream.
When that happens, a dramatic rise in electrical rates just starting will go up in leaps and bounds. As of the first of this year, I think they jumped 14.36 percent. That was the amount of the rebate that was lifted. Then, there was another 13-point-whatever percent increase, and another 5.6 percent on top of that, or whatever it is right now. We know that it is going to continue to increase, year after year, because the Yukon Energy Corporation itself has done very, very little to plan new hydro generation.
They have kind of lucked into one that may go ahead: the old Surprise Lake project, which is being reinvented by a group not from the Yukon. They are going to try to jump on that bandwagon. It makes particularly good sense for them, because the environmental problems will not be theirs - they will be down in B.C. somewhere. So, the government can pay lip service to hydro generation and even support it without alienating their Green Party friends.
We have had this situation occurring: the federal government, in an extremely generous gesture, handed over the assets of N.C.P.C. with a huge debt write-off guaranteeing, for the first number of years, that the Yukon Energy Corporation would be making big profits. However, the profits of that corporation have been largely stripped away through dividend and interest payments and administration expenses to the Yukon Development Corporation.
The cost of generating electricity is going up, mainly because demand is going up and - guess what? - in order to generate power to meet the increasing demand, we have had to resort to diesel generation.
This is an expensive, environmentally unsound, bandaid solution to the basic problem. Because many of the profits have been siphoned away and used for other things, the need for electrical rate increases has been exacerbated.
Again, what we are trying to do here is to simply put into law, as one of the objects of the corporation, the principle that these monies and the profits made from and on the backs of energy consumers ought to be utilized and invested in the development of energy resource infrastructure, or in equalizing or reducing the cost of electrical energy to Yukon consumers.
It is interesting to go back to the debate of a year ago. The Government Leader, who at one time was the Minister responsible for the Yukon Development Corporation and the Yukon Energy Corporation, took umbrage at much of what I had been saying at the time, which really did not surprise me, because what I had to say about the results of the governments activities was not entirely flattering. His defence became extremely technical and he got into the whole area of debt/equity ratio and what an important issue that is. In part of his extremely technical argument, he had some very interesting things to say. To be entirely fair, much of what he had to say in that portion of his speech, was quite correct.
It is often the case, with that particular Member and some of his compatriots over there, that they make arguments that are at least partially sound and convincing, particularly when they use the ruse of making out the arguments from this side to be something other than what they really are. I think in everyday parlance it is called putting words in someone elses mouth and then shooting down those words. I realize that a couple of years ago, when I was a younger fellow, I might have been taken aback by that type of thing, but no longer.
I have said that the debt/equity ratio is important and that it is one of those many interesting things that public utility boards look at, as well as the accountants and lawyers from all sides. Economists debate on these things. There is all kinds of interesting articles in the accounting periuodicals and all of those other reports. I am sure that the Members opposite and I spend a lot of time pouring over those reports in our spare time. This particular amendment is not intended to affect the debt/equity ratio; that would be most appropriate for the Yukon Energy Corporation to determine. This amendment is broad enough to give a great deal of leeway to the corporation, yet ensure that the profits end up being spent in energy-related matters.
A year ago, the Government Leader, the previous Minister responsible for the Yukon Development Corporation and Yukon Energy Corporation, went through the money that had been paid to the corporations from the Yukon government - that is found on page 224 on Hansard, November 14, 1990. I will briefly quote him. ... I would like to put on the record the flow of funds from the Yukon government to the Development Corporation and to the Energy Corporation. First of all, there was an equity grant from the territorial government to the Development Corporation of $29 million.
Second, there was an advance from the territorial government to the Development Corporation of $14,336,000. The Development Corporation purchased Energy Corporation shares, which involved a transaction of $39 million going from the Development Corporation to the Energy Corporation. There were dividends paid in two years and those numbers have been put on the record: one year, $8,615,000; and the next year, $7,623,000. There were advances to Highland Forest Products of $10.9 million from the Development Corporation, and lastly there was a loan from the Development Corporation to the Energy Corporation of $5.5 million.
Believe it or not, we are basically in agreement with the figures. The current Minister for the Yukon Development Corporation wants me to keep reading. Does he want me to read the entire speech that was given by his boss, or just portions of it that he likes?
The point is, most of this was advanced and went directly into capital. The working capital, as I have already said, was about $4.8 million - under $5 million, at least. After the $16.2 million went from the Yukon Energy Corporation by way of dividends up to the parent company, the working capital was only a couple of million dollars more, so it would seem to be very clear that a large portion of the $10.9 million advanced to the Watson Lake company really was money that came from the profits, i.e. the dividends paid, from Yukon Energy Corporation to the Yukon Development Corporation.
I think that no matter how the side opposite wants to play with the figures, there are inescapable facts on the record. The record has been handed out to us all by way of the various annual reports from the two corporations.
I am concerned that we see a new approach to the corporation. We see government really take an interest in energy infrastructure and give that infrastructure and the corporation a lot more attention and treat the provision of environmentally sound, economical, electrical energy as one of the top priorities of this government.
They might begin by taking very serious the public remarks made by Mr. Jack Cable when he stepped down the other day. They might have a good hard look at what the relationship between government and the two corporations, the Yukon Energy Corporation and the Yukon Development Corporation, ought to be. They might consider spelling out the relationship in black and white and making it public so that we can all have a look at it and perhaps be reassured about what the future might bring. This is especially necessary, given recent events.
We have the revelation of this new $2.3 million diesel generator being installed over here. We have the resignation of Mr. Cable. We have the rate hearings going on at this very minute in Whitehorse, and we have a lot of disgruntled Yukoners who happen to purchase electricity, directly or indirectly, from the Yukon Energy Corporation.
I am calling for this clarification, in writing, partly because I think the general public needs to be reassured with regard to the future of these corporations, which are so fundamentally important to our economic environment.
The average consumer wants to know, and has a right to know, whether or not government is going to continue to meddle in the affairs of the two Crown corporations we are speaking about here today.
The concept of the Yukon Development Corporation is one that is not new. It is a concept I think most Yukoners discussed long before the 1985 election. A development corporation was certainly a plank in the platform of the Yukon Territorial Progressive Conservative Party, which later became known as the PC Yukon Party, and is now known as the Yukon Party.
Some Hon. Member: Are you sure?
Mr. Phelps: Yes. I am asked a question by the Minister, which shows that he is paying attention. I always enjoy answering his questions, even during Question Period, which is unusual, but it is something that I enjoy doing, nonetheless.
Yes, I am certain that it was a plank in the platform back in 1982, when we first announced our intention to negotiate for the assets of NCPC back in April of 1985 - in public speeches that we still have. The concept of a Yukon Development Corporation to hold those assets was also announced.
The Minister asked, for what purpose?
I am not really sure what he is referring to. For what purpose did we announce it? Simply because we, unlike the Minister and his colleagues from the side opposite, believe that the Yukon rate payers have every right to be informed about how their money is spent and how the public purse is used.
Unfortunately, the Minister would ask for what purpose would we come clean with the voters of the Yukon Territory back in 1985. I can understand why he would be puzzled. I think most Yukoners know that I fought desperately to get information with respect to the financial records and numerous contracts that surrounded the Watson Lake sawmill fiasco. Under the Access to Information Act, my simple request was turned down by his government. I appealed to the Minister and was turned down by him. I went to the Supreme Court of the Yukon, under the provisions of the act, and was turned down there. So, I can understand why a stonewalling government, and a Minister of that government, would be perplexed that anybody in this game called politics would want to be honest and straightforward and let the voters know of their true intent, should they get involved in something as important as the provision of electricity to Yukon consumers.
I have always felt that one should be honest with the public. It is dangerous to be tricky. Sometimes when one starts telling falsehoods one forgets exactly what one said the last time. When one just tells the truth, it is hard to get tripped up.
Those are some of the reasons why we did that. Does the Minister have another question?
He has no questions. I take it, then, that he will be supporting this motion and I can understand very well why he might.
Point of Order
Speaker: Order please. A point of order to the Minister of Economic Development.
Hon. Mr. Byblow: In order that the House be fully informed on the nature of the question being posed to the Member speaking, would he entertain a formal question?
Speaker: Order please.
Mr. Phelps: I am sure the Speaker will find the Member has no point of order, but I will wait for your decision.
Speaker: I find there is no point of order.
Mr. Phelps: That is what happens when people start to mess with the rules. It really cuts into a fellows concentration. I had a couple of really good points I wanted to make, but perhaps it is now time to move that debate be adjourned?
I move that debate be now adjourned.
Speaker: It has been moved by the Hon. Member for Hootalinqua that debate be now adjourned.
Motion to adjourn debate agreed to
Hon. Mr. McDonald: I move that the Speaker do now leave the Chair and that the House resolve into Committee of the Whole.
Speaker: It has been moved by the Government House Leader that the Speaker do now leave the Chair and that the House resolve into Committee of the Whole.
Motion agreed to
Speaker leaves the Chair
COMMITTEE OF THE WHOLE
Chair: I will now call Committee of the Whole to order. We will recess until 7:30 p.m.
Chair: I will now call Committee of the Whole to Order.
Bill No. 18 - Second Appropriation Act, 1991-92 - continued
Economic Development: Mines and Small Business - continued
INTRODUCTION OF VISITORS
Hon. Mr. Byblow: As we begin continued Committee discussion, I think that it would be appropriate to note the presence in the gallery of a former Member of this Legislature, Mr. Al Falle and his wife Irma, and I trust that he feels very much at home in these surroundings, and looks forward to the proceedings that he is about to hear.
Hon. Mr. Byblow: I should also draw attention to the presence of my Deputy Minister for Economic Mines and Small Business, Dr. Nick Poushinsky, who is with me to assist in any technical or detail points that may arise. Members may well know that Dr. Poushinsky comes to us with a doctorate in sociology and has a 20-year career behind him in business in the private sector and also in mining consulting work.
When we left off yesterday, we were in the general debate stage discussing support to the mining industry. I made a number of general comments about the current, depressed state of mining in the country and, indeed, in the world. I made the observation that the conditions in the Yukon were somewhat more fortunate than conditions elsewhere in that we had a number of prospective properties being developed at various prefeasibility and feasibility stages. I was making the observation that a number of our programs go a long way to provide the kind of support to the industry that it requires to retain its confidence toward investment here.
I believe the Members were raising the issue of flow-through shares, a program of the federal government of some years past that has been terminated. The Member was raising a question of what consideration we may be giving to it.
To conclude the response on that score, in respect to the concept of flow-through shares and in respect to the value of the investment through flow-through shares, the benefit to the industry is limited when those particular incentives are used.
That is not to say that the program was entirely bad. It did inject additional investment funds in the mining industry. Often, because of the nature of the tax credit provided, there was investment that was not necessarily done with discretion. In the absence of that incentive, the encouragement to continue that kind of exploratory and development work fell away.
Part of what we have tried to do in support of the mining industry has been to target all incentive programs to more critical areas in the mining industry where the benefits would be very encouraging to long-term exploration and development work. As a result, we have before us the kind of programs that are in place.
The entire EDA has been structured that way on the mining component side. The mineral resources subagreement is tailored to provide the industry with the kind of long-term support that will make it want to come here because there is less risk, stay here because there is more data-base support and remain here because there is opportunity for technology to be advanced and enough support to the industry to make it comfortable in this community.
Under the mining component of the EDA, we are setting up a team of geologists and scientists to provide direct support to the industry, in terms of mapping, new technology, critical geological knowledge that the industry cannot itself do without great expense, which is of tremendous support to the industry. The industry helped us design the mineral component of the EDA. The $9 million that will flow from that mineral component will go a long way toward providing the kind of core technological support to the industry to make it want to stay.
We have targeted our investment dollars. I make no secret of it; we got 30-cent dollars out of the deal. The 70/30 cost-sharing arrangement has certainly levered additional funds into the territory toward that program. In addition to a scientific and geological support base, and in addition to the technological support base, that program also has a communication component. A portion of the mining resources subagreement focuses on education and communication purposes.
Our resource access transportation program is targeted to infrastructure support. Our business development support program can also be used, but not as much, by the mining community. I have already indicated to the Member who spoke previously that the Yukon Mining Incentive Program has been more recently over subscribed than under subscribed. At the exploration level, the mining community really likes it and, in fact, this budget reflects an extra $100,000 for it.
What we have done is target programs to help their base of support, to encourage them to stay and find more reasons to invest.
Mr. Lang: Before I begin, I would also like to welcome the previous MLA for Hootalinqua, Mr. Falle, and his good wife Irma, who are in attendance in the gallery.
I would now like to get back to the question I asked - this sounds like Question Period. It brings back memories of just a few short hours ago. I asked the Minister a very direct question - my colleague the Member from Riverdale North, says to be careful do not ask a direct question. I will though, I will venture into unchartered waters.
I would like to ask the Minister if he is prepared to support the concept of working with the Government of Canada and the mining industry in seeing whether or not we can put together a similar program to the flow-through share program that was put into place for Canada? Also, looking at the shortcomings of the previous legislation, to see whether or not the Government of Canada was prepared to put it in for the north. The reason that I ask that is that it is fine for the Minister to talk about the grants and all of the money that he has for the mining industry, but I just pointed out three cases within my constituency alone where people in the mining industry are either leaving the industry and going into another way of making a living because there is no work, or they are leaving the territory and going to places like Venezuela. They are not going to other parts of Canada, they are leaving the country. The Member for Whitehorse Riverdale South says that is pretty grave, and it is grave.
Some Hon. Member: (Inaudible)
Mr. Lang: The Member says it is free trade. I think that it is very important that we look at some of the reasons why this has taken place and see what can we do to resolve it. Government is not going to solve the problem with grants alone. There might be a few people here prepared to take out the applications, but most of these people are going to leave, because they do not necessarily want the grants. They want incentives where they can go out and do their thing and not have somebody telling them how to do it.
The Minister has pointed out some of the shortcomings of the flow-through share program that was previously in place. I am not disagreeing that there were some shortcomings, but I submit that maybe it is a vehicle that we can take a look at to see whether or not we can initiate something in conjunction with the Government of Canada and the industry to see what we could put in place.
Hon. Mr. Byblow: I will try to give the Member a direct answer. As the Member knows, a complete answer may require some background.
The short answer to the Members question about flow-through shares is not only would we consider looking at it, we already have. I put that in the context of when the last communication, or discussion, on the subject took place. At the last Mines Ministers Conference in September, the entire issue of not just flow-through shares, but federal support programs, was brought up by all jurisdictions to the federal Minister. There was a fairly healthy exchange and vociferous lobby, not just by politicians, but by the industry as well. The industry comes and sits with Ministers at the Mines Ministers Conferences, and issues are debated.
The message was loud and clear that jurisdictions wanted to see the federal government reinstitute some federal support programs to the mining industry. The industry was quite outspoken about its willingness to work with the federal government, provincial and territorial jurisdictions, to see if some sharing of responsibility could be done but, at the minimum, that the federal government should refine the flow-through share program it had, get rid of the bugs and bad elements, and reinstitute it. That is taking place.
I should also remark that I do not think the Member gives fair judgment on the programs we do have. They are not simply grants that are spent and forgotten. The Yukon mining incentive program has three components to it. Each one of the components, depending on what kind of work it is - exploration, feasibility work, pre feasibility work with another venture - is percentage-of-cost programming.
In other words, we contribute 25 percent toward the specific objective. That levers another 75 percent funding from other sources. That has been the concept behind our support to the industry, on the program side. At the same time, of course, we are providing the infrastructure development throughout the territory, as best we can, in support of the industry.
The short answer is yes. The flow-through share program, in concept, is under discussion, but there was general agreement that nobody liked the old program, as it was. There were problems. There was some bad investment through it. Some of the money spent was extremely inefficiently used. We have tried to better target our investment money for the industry.
Mr. Lang: I will make this point and then I will leave it. I assume the answer was yes; that was what I gleaned from the last portion of his presentation.
I recognize that perhaps all of the provinces would like to have this instituted across the country, which makes it that much more difficult to get the necessary green light from the Government of Canada, because of the long-term financial consequences to the public treasury.
My observation is that perhaps the position that should be taken, in conjunction with the Northwest Territories, is that the Government of Canada has a special responsibility to our resources. They are, for all intents and purposes, the provincial government for our resources and they should be seriously considering putting something into place specifically for the north - even as a pilot project for a year or two, if they are not prepared to put it into place across the country - so that at least there is an area of the country getting the benefit of some incentives of this kind. It could be used as a pilot program for the rest of the country if it is successful.
Hon. Mr. Byblow: I would not disagree that there is merit in exploring any program option that would enhance support to a resource sector. I am no financial expert. I would not want to comment, to any great extent, on formula financing arrangements between the federal government and us. It would be imperative, in my judgment, that whatever kind of tax break program we may put in place, we not be, at the same time, adversely affected in a formula financing arrangement causing us to lose the entire benefit that we are trying to create.
It is necessary to look at options and look at federal support to the industry that they have recently vacated. In that entire context, I would want to know that we are making a wise investment.
Mr. Devries: I just have one more question on the way things are arranged here. I want to make sure I am correct on something. Are the areas under capital expenditures for energy and mines strictly grants and the administration is under the operation and maintenance expenditures? For example, is the full $960,000 in the Saving Energy Action Loan Fund all grants? Is there any administration in that?
Hon. Mr. Byblow: That is not entirely correct. In the examples cited by the Member, the $935,000 of additional funds under the community development fund, would, in part, pay some personnel dollars related to the officers who implement the program. The administration that the Member is referring to would be the broad departmental administration.
There are additional program officer dollars in the program itself, such as the community development fund, SEAL, the business development fund or even the economic development agreement.
Mr. Devries: I understand that he cannot supply us with the names of the applicants under the SEAL program. That was made clear to me in a letter. In the past, under the Yukon energy alternatives program, we received a list of who the applicants were and if they were approved or disapproved.
Hon. Mr. Byblow: It was my intention, through the supplementary discussions, to find out what Members specifically wanted. I know at least one Member has written me a letter, and I am responding to the Member with some of the information requested. I have no problem taking notice on the information that the Member wants and providing it in advance of the mains debate, which would provide the most recent summary of information.
I take note of the YEAP and will provide it.
Mr. Devries: I have no further questions under general debate. If someone else has questions, please feel free to go ahead.
On Operation and Maintenance Expenditures
Administration in the amount of $105,000 agreed to
On Energy and Mines
Energy and Mines in the amount of $63,000 agreed to
On Economic Policy, Planning and Research
Economic Policy, Planning and Research in the amount of $446,000 agreed to
On Economic Programs
Economic Programs in the amount of $51,000 agreed to
Operation and Maintenance Expenditures in the amount of $665,000 agreed to
On Capital Expenditures
On Energy and Mines
On Energy Conservation Fund (SEAL)
Energy Conservation Fund (SEAL) in the amount of $360,000 agreed to
On Yukon Energy Alternatives (YEAP)
Yukon Energy Alternatives (YEAP) in the amount of an under expenditure of $172,000 agreed to
On Internal Energy Management
Internal Energy Management in the amount of $5,000 agreed to
On Yukon Mining Incentives Program
Yukon Mining Incentives Program in the amount of $107,000 agreed to
On Economic Development Agreement
Economic Development Agreement in the amount of $1,050,000 agreed to
Energy and Mines in the amount of $1,350,000 agreed to
On Economic Policy, Planning and Research
On Economic Development Agreement
Hon. Mr. Byblow: Perhaps Members may want just a brief explanation. What is occurring is not really a reduction in the EDA; it is a realignment of where the money is being placed administratively within the department. If the Members would look further down in the vote, $3.4 million is being added to the EDA as a result of having signed the EDA this year. Two things are happening. One of the elements is that the program is being moved from policy and planning over to economic programs, the other is that additional funding is being injected to meet our obligations under the new agreement that was signed. At the time this budget was prepared a year ago, we had not even come close to reaching agreement on a five-year deal; we were thinking it would be another one-year deal, so it was projected for that. But when the final deal was signed, additional funds were required to meet our 30/70 obligation.
So, it is a realignment in the department and new money.
Mrs. Firth: I want to follow up with a request I made of the Minister some time ago, in the form of a letter, to be updated on all the programs. Could the Minister tell us whether I am going to get that information or not?
Hon. Mr. Byblow: I know precisely the letter in question. I believe I responded with some of the information in an earlier letter. The rest of the information is fairly well compiled now and the Member should get the response this week.
Economic Development Agreement in the amount of an under expenditure of $2,766,000 agreed to
Economic Policy, Planning and Research in the amount of an under expenditure of $,2766.000 agreed to
On Economic Programs
On Community Development Fund
Community Development Fund in the amount of $935,000 agreed to
On Business Development Fund
Business Development Fund in the amount of $530,000 agreed to
On Economic Development Agreement
Economic Development Agreement in the amount of $3,462,000 agreed to
Economic Programs in the amount of $4,927,000 agreed to
Economic Development: Mines and Small Business in the amount of $3,511,000 agreed to
Chair: Are there any questions on capital recoveries?
Chair: Is there any general debate?
Hon. Mr. Penikett: The supplementary in Finance is entirely due to the wage settlement we reached with our employees. As Members know from previous comments, this covers two years worth of those settlements.
Mr. Phelps: We are waiting for the critic to emerge from his chambers. He should be here any second. In the meantime, I would like to hear any kind of esoteric information the Minister might care to divulge.
Hon. Mr. Penikett: It is quite simple. There is only one explanation for the supplementary. It is entirely due to the wage settlement, which I have already explained. There is nothing else I can add.
On Operation and Maintenance
Treasury in the amount of $328,000 agreed to
Finance in the amount of $328,000 agreed to
Chair: Is there any general debate?
Hon. Mr. McDonald: The Government Services supplementary budget requirements total $1,983,000 in operation and maintenance and $389,000 on the capital side.
Of the requirement for operation and maintenance, $1.5 million is for personnel, which is primarily to be dedicated toward the collective agreement impacts. As well, there is $220,000 required for increasing utility costs, $170,000 for the full operation of Old Yukon College, and $50,000 for the startup of the archives building.
There is a $140,000 increase for incremental rental costs for office space throughout the territory; $86,000 is required due to an accounting change for the recovery of office space costs for Yukon Liquor Corporation. A $60,000 increase is required to print Yukon Statutes annually, as opposed to every seven years. There is a transfer payment request of $40,000 that will provide funding for a contribution agreement to be entered into with the Recycling Centre for the pick-up of government waste paper for recycling. On the capital side of the program the largest requirement is for the salary and benefit component of property management and the design and construction overhead. This will provide for the $156,000 for collective agreement costs.
The other single largest item is the $125,000 for the replacement of this Legislative Assemblys sound system. That is a general explanation of matters. We can perhaps get into detail in line-by-line and maybe some discussion in general debate.
Mr. Phillips: I have just a few comments in general debate. I would like the Minister to comment on them.
In the last few days I have been talking to several contractors. I think on Thursday night, tomorrow night, we have a meeting with the contractors, where the government has called a meeting to find out what the forecast is for projects next year. I have had a couple of concerns raised about that. I guess the main concern is that the contractors show up at this meeting and they are given a big, long list of projects that are going to go ahead. The purpose of the meeting is to forewarn the contractors of the type of work that is coming so that they can tool up and have an idea of what they are going to need through the construction season. We then turn around and do not proceed with many millions of dollars of projects. Some of the contractors get caught with that, most of them nowadays operate on sort of a shoestring staff and hire the staff that they can. When the government announces all of these programs and they get ready to go for them they get upset when the government decides to cancel all of the jobs.
Another complaint I have heard is related to the Watson Lake weigh scale, where the tenders went out and the bids came in way above the cost projected by the government. Then the government decided not to go ahead with the project. That may or may not have been a good decision by the government. What has upset all of the contractors is that it takes sometimes hundreds of hours for a contractor to put together their estimate, and they get rather frustrated when the government estimates are so far off base. They have put time and effort and money into all of these estimates and yet there is no way for them to receive any compensation. It seems to me that it is a bit unfair when the mistake in this particular case appears to be either in the preliminary estimates by the architect or the estimates by the government itself, because certainly all of the contractors, who are used to doing work here in the north, for many, many years, could not be that far off in all of their estimates.
The third concern I have heard relates to some jobs that are coming out now, regarding the poor quality of the specifications and the difficulties the contractors are running into when they start to do the job, especially in the case of renovations. I think the new addition to the library is a good example. They are running into all kinds of complications because the specifications were not done properly in the first place. It creates a lot of delays for the contractor and delays cost money. In lots of cases, the contractor can never recover that money, when he has crews standing around waiting for a decision of somebody in government, to correct the plans or to make other plans so that they can continue with the job.
I would just like to hear from the Minister and see if he has any comments on those matters.
Hon. Mr. McDonald: It is correct that tomorrow night there will be the annual construction forecast meeting, which will introduce contractors to the projects that are anticipated to be under construction for the following construction year - those projects that are identified in the estimates that we are about to debate.
The fact of the matter is that some of the projects do not go ahead. I do not think it would be right to characterize it that all of the projects or all of the jobs will be cancelled for the following year. I think it is perhaps more accurate to suggest that some of the projects do not go ahead for a variety of very different reasons.
The vast majority of the projects do go ahead, but some do not. The ones that I am most familiar with are the Education projects - I presume no one thinks I am going to finish this sentence for quite a while. All the table officers have left.
Some of the projects do not go ahead in the end largely because there is some hangup with the public consultation or the design specs have to be scaled back because of cost. There are a variety of reasons.
We generally do not like to raise the expectations of either the contractor or the public, who will be served by the facility to be constructed, only to go back later and scale expectations down.
We put the items in the budget in order that they go ahead. We experience some frustration when things do not go as planned. As a general proposition, we try to keep that to an absolute minimum.
I am not an expert when it comes to design specifications and trying to ensure that the design specificiations are well-costed prior to the tender call. We are held hostage a bit to the architect, who designs the facility and costs the facility, and we also have to face the problems of tendering some facilities when contractors are already quite busy. There may be a bit of that situation in the case of the Watson Lake weigh scale. I am still looking into that particular case and will try to provide a more comprehensive answer as to what has transpired there, once I get the final word from Government Services.
With respect to the poor quality specifications, it is important that we recognize that we need to have clear specifications, as does any owner, that allow the contractors to bid with full knowledge of what they are bidding for, prior to the awarding of a contract.
I have heard of poor quality blueprints or specifications on a couple of projects and I have asked the Department of Government Services to raise this matter with the architects involved. It is clearly a problem that has to be addressed in the long term.
In the meetings I had with the contractors association and in the context of the discussions I had with them, I asked that, if they feel the specifications are poor, or that the projects have been over designed, they should let us know. For their part, a couple of the contractors indicated that they had raised the issue with Government Services personnel, only, they claim, to have been ignored in the end. I have indicated that if that is the case, they should take the matter up with me and I will deal with it personally.
I am concerned about both of those matters: over-design and the quality of the blueprints and specifications. On the library project and the Granger school project, there have been problems experienced on both sites. The Members comments are valid and I have already had an opportunity to deal with the department and the contractors association on it.
Mr. Phillips: Most of these items relate to project management itself. A couple of years ago, the Public Accounts Committee recommended development and implementation of a new manual. Where are we with that? The last Minister said it was being developed and the Department of Government Services was to implement it shortly. Could the Minister give us an update on where we are with the project management scheme and whether other departments in government are also adopting and working from that same type of manual?
Hon. Mr. McDonald: All projects that are managed by the Government of Yukon through Government Services are required to follow the new Management Board directives, and the new Management Board directives have been approved.
There has been some growing pains, in the sense of getting used to a new manner of planning projects. It is a little more bureaucratic to come back and go through all the paperwork to get extra approvals to prove that planning has been done in various stages. That extra bureaucracy is the downside. The upside is that Management Board is more reassured that much of the planning required at various stages has been done or considered.
The short answer to the question is that all government projects that fall under the Management Board directive have to be done under this new planning schedule. The department is just going to have to get used to doing it this way.
Mr. Phillips: Can the Minister tell us whether or not work on the new visitor reception centre was done under that particular new scheme we have? We were told before that the $400,000 increase was attributed to poor soil conditions, then they added a few more items after that. Should things like a sprinkler system not have been picked up earlier? Is this something someone decided to do after? Could he update us on why that particular project was not picked up on right at the beginning before it all went to tender?
Hon. Mr. McDonald: I will have to take the detail of the question as notice. I am certain we will be at this for a little while, so I will have time to get back to the Member either here or in the main estimates.
My understanding was that the visitor reception centre, as a general proposition, did follow the Management Board guidelines respecting reporting back at various stages during the planning process, but my personal knowledge of this construction project is limited at this time.
Mr. Phillips: I have a couple of additional questions under general debate. Can the Minister update us on the status of the business incentive policy and how soon it will be before we will see results from the policy?
Hon. Mr. McDonald: The business incentive policy is a line item in the budget. The policy has been in effect for local labour and locally manufactured products for about one year. The committee that was charged with reviewing the policy and with reviewing the schedules pursuant to the policy, have also been meeting. This committee includes government and private sector people and is chaired by Economic Development.
The committee has made a couple of recommendations that have been approved by Management Board. One recommendation is that the rebate schedule should be approved by the Minister rather than by Management Board. This will allow for faster changes to be made. The second recommendation is that manufacturers of products may apply directly for rebates rather than apply through the general contractor. Both of those changes have been recommended and approved.
We hope that the policy as it applies to goods will be put into effect this winter. This part of the policy pays rebates for goods produced in the Yukon that are supplied to the government under purchase contracts. As I said, this should be put into effect this winter.
At this time, we do not have any plans to apply the policy to other services and will not do so unless there is an identified opportunity and need.
Mrs. Firth: I would like to ask a couple of questions about the visitor reception centre, as I have some information about the whole tendering process.
When the public announcement was made, I did some research regarding that whole process with the Department of Tourism. I would like to indicate to the Minister exactly what happened for when he checks it tomorrow with the department with respect as to whether or not the proper procedures were followed. I do not think that they were, and the whole process was chaotic and frustrating for a lot of the officials within the Tourism department.
Apparently, in May, there were ads in the papers for interested parties to submit any proposals they had, together with their credentials. That closed around June 5 and, apparently, the department had received over 40 responses. After that, the responses were reviewed by Government Services and Tourism officials. They based the review on a variety of things, such as experience with northern construction and the evidence that they thought indicated a well-prepared proposal.
Evidently, 13 companies were short-listed and contacted. They were given more information by the government about the proposal and the facility. At that time, they responded with a more detailed proposal and, out of the 13 proposals that were short-listed, they received six. Still, there were no real design concepts at that stage.
It was short-listed with three consultant firms and, in August, they were invited and flown to Whitehorse to present their proposals and expand on them. They met with Government Services and the Department of Tourism - I believe that the Minister of Tourism also attended the meeting. They were presented with some conceptual ideas, and then one of the teams was selected.
There was a committee created made up of the Government Services people and architects, Tourism officials and some public advisors, as well as people from the City of Whitehorse. This may ring a bell with the Minister of Tourism. It was quite a lengthy process, and it was at that time that the pattern of the building started to emerge and the design proposal was asked for, and the visitor reception centre came into being.
It was quite a chaotic process, and I had a lot of complaints from a couple of contractors who are constituents of mine.
I had a lot of questions about the whole process and about whether they had been treated fairly. Then I had a lot of complaints from the public about not having input into this building that was being built and whether they would have an opportunity - I hear the Minister of Tourism saying, Oh, come on. Well, he might think that he went and knocked on everybodys door and asked their opinion, but he did not. All I am doing is relaying the concerns that I have heard. If the Minister of Tourism is upset with it, I really am sorry about that, but that is what I have heard. He will get his chance to speak about it.
Anyway, both departments, I gather, found the whole process very frustrating, and I think there was a major role played, more by the Department of Tourism than by the Department of Government Services. But to answer the question of whether the project management manual was followed, whether there was a perception that there was a level playing field for all of the contractors here in the Yukon, or whether the government really knew what it wanted - I think the evidence that I have just produced indicates not.
If the Members are questioning where my information came from, it came from the Department of Tourism. The Deputy Minister authorized the individual to telephone me and tell me this whole story, so I was told the whole process of how it happened. The Minister can get up and say that it did not happen, but that is what they told me they thought had happened. I will be very interested in what the Minister has to say.
My message for the Minister of Government Services is that they should start looking at a more structured process. The government has, on a couple of occasions, got into trouble with this whole proposal concept, where they ask for proposals and architectural designs and concepts and all of this artistic input, without having some real specific objectives and some real specs and direction to give to the community. Consequently, the costs are now escalating. I believe at that presentation we asked several questions with respect to the design and about some of the issues that have been raised recently in the Legislative Assembly.
I am interested in hearing what the Minister of Government Services has to say. I gather the Minister of Tourism wants to make some comments, as well. I will listen to what they have to say.
Some Hon. Member: (Inaudible)
Mrs. Firth: Easy now. I have a horse like that. Every time I try to get on him, he walks away before I can get my foot in the stirrup.
I would like to hear what they have to say. I would like to hear particularly from the Minister of Government Services on what he proposes to do to see that this kind of chaotic tendering process does not occur again.
Hon. Mr. Webster: I would permit the Minister of Government Services to respond to that, as requested by the Member opposite, but, since in her line of questioning she refers so often to the complaints and issues that were raised by the Department of Tourism, I feel compelled to answer. I was involved in the whole process of coming up with the process about how to select a consultant and, in the end, to accept their design and cost estimates.
It is unfortunate that she has received a lot of complaints from constituents and contractors about the lack of public input into the whole process. I really do feel, having listened to the Member, that perhaps she has taken all those calls and somehow really confused herself. There was a great deal of public input into the selection of the architect-design-engineering team. We had on our committee representatives from many organizations, representing the entire Yukon - from the Council for Yukon Indians, the Tourism Industry Association of the Yukon, the Chamber of Commerce, the City of Whitehorse to the Yukon Historical Museums Association. They all had representation on a committee. We all sat down and determined what we were looking for in the design concept and contents of a Yukon visitor reception centre designed to make visitors to the Yukon welcome and inform them very well on the attractions the Yukon has to offer. All the Yukon has to offer also includes the attractions operated by Parks Canada, so they, too, were represented on that committee.
The Member was accurate. From the very beginning we did have a lot of interest expressed by a variety of consulting design and architectural firms. It was narrowed down to three, who were invited to make a presentation before the committee. I want to stress that this committee was not just composed of bureaucrats; also involved were people representing these various Yukon-wide organizations.
The final decision was fairly unanimous on the one firm that had the final opportunity to forward a design. They came up with a concept that was very much endorsed by the committee. Once the design was presented, some comments were made by committee members suggesting changes here and there - perhaps more Yukon content, et cetera - but all in all, all members of the committee were quite pleased with the design that was produced by the winning firm.
As for following procedures, according to the procedure outlined by Government Services in awarding the contract, I want to assure the Member that all the procedures were followed. The original estimate of the building - and I stress the building - I want to stress that - not the whole project, was $1.3 million. Soil testing results in the area proved that we would have to have a stronger foundation than originally planned. That, in turn, necessitated making further changes, some of which I have already outlined in this House. The most significant change was that of changing the foundation to a basement, which allowed us to have some storage area for all the materials we hand out to the tourists. It also enabled us to move the mechanical room from the main floor down into the basement area. The much celebrated $25,000 expense of a sprinkler system was the only thing that was not additional as a result of the change in the foundation.
I want to inform Members that that is actually an option. It is not required by law to have a sprinkler system of that size, but we thought it would be a good idea to include it.
The result was an increase in cost of about $300,000, due to the changes in the building. When the building was put out to tender, along with the necessary infrastructure improvements and roadwork, the low bid by a Yukon contractor came in at $200,000 over budget, so that makes it $300,000 for changes, plus the $200,000 over budget, for a total of $500,000. Once the low tenderer was awarded the contract, we sat down with that contractor and made some minor revisions and substitutions of materials, and knocked off $100,000, thereby giving you the final supplementary figure of $400,000.
It is beyond me how any contractors could have complained about the procedures, having followed the format laid out by Government Services. It is also beyond me how some of the constituents of the Member for Riverdale South could complain - not her personally, of course; she is only speaking on their behalf - that they somehow lacked any kind of input into the design of that building.
As far as I am concerned, it was a lengthy process. It would appear to have been somewhat complicated, but I assure you that everything was done according to procedure and, in the end, we have a product that we will be very happy with, and one that will serve its function well.
Chair: Committee of the Whole will take a brief recess.
Chair: I will now call the Committee to order.
Mrs. Firth: Perhaps the Minister of Government Services could give us some indication about what he is going to do within his department to see whether or not the property management guidelines are going to be followed. Does he feel comfortable that they are being followed? I would like to hear his comments so that we can have some assurance that these projects are going to follow some guidelines or rules.
Hon. Mr. McDonald: As I indicated earlier, the new manual for building development was approved by Management Board and published this past summer. All projects must follow the Management Board directive with respect to the planning stages.
I can speak generically about the subject because I do have some experience with other large projects that have gone through the Department of Education, for example. It is not uncommon to begin a large project by calling for proposals from architects to submit designs and concepts that would then be selected by a public review committee. That is how it happens with virtually all schools where the design starts from scratch. That is how it happened with the Arts Centre and with the Arts Centre equipment.
That is the way it happened with the college itself, back in 1985. Under those circumstances, there was a call for architects to put forward proposals and concepts and the general design scheme, within a set of guidelines that are drafted by the sponsoring department. They are very general guidelines. They do mock-up schematic designs for review by the committee and then the committee chooses the architect who they think will do the best job. They proceed with that architect, who does a blueprint drawing, and then they tender the contract for the construction.
I am not sure whether the Member was referring specifically to the call proposals, which is sometimes referred to as the design-build process. If she is, I can certainly respond to that issue, as well; it is a separate issue, of course, but I can respond to that.
I have already undertaken to the other Member who posed questions that I would be getting back with further information on this and other matters.
Mrs. Firth: I will wait until the Minister brings the information back.
I would like to ask the Minister about another concern with respect to these capital projects that are being built. My concern has to do with soil testing. We can count at least three or four circumstances where difficulties have been encountered - the Golden Horn school, the Granger school, where they ran into some trouble and had to move the location a bit, the MacPherson school and the visitor reception centre. Soil testing always seems to be done after the fact and it ends up costing considerably more money. The most astonishing figure was the one at the Golden Horn school where it was supposed to cost $40,000 to $50,000 and ended up costing $400,000.
Can the Minister tell us exactly how that procedure is done and whether it is considered part of the guidelines? Is the Minister concerned about it and has he given his department any direction to look at doing more accurate soil testing and analysis at the location of these projects?
Hon. Mr. McDonald: I am concerned about this particular area. Soil testing is part of the geo-tech work that should be done for any construction project. It should be done during the design stage and the architect should take the soils into consideration when designing the final project. There is no question about that.
The problem at the Golden Horn school - and I would think that this is an exception to the other projects the Member cited - is that there was a great deal of pressure to build this school in an incredibly short time. At the time when the decision was made to proceed with the school - I believe this was in November - there was an expectation that the school would be in place by September. Consequently, a lot of things had to be done on a very compact schedule. The site was chosen as the best site. I understand that the people who were excavating did not know what the soil conditions would be like until they actually put the shovel into the ground.
There have been times in the past when the site itself was considered to be the most practical and the best site for the construction project. Consequently, barring a project that is proposed to be put into a swamp, sometimes the site location is chosen for reasons other than building construction considerations. It is chosen because it is the best site and closest to the population, or because it meets other criteria.
In any case, those things, in my view, should be anticipated in the design of the projects and there should not be surprises in the construction. I have talked to Government Services about this, because not only does it inflate the costs, it requires design changes that sometimes delay the project and the tender. I am concerned about that and I have communicated that to the department.
Mr. Phillips: I would like to follow up on the issue of the soil tests. The Golden Horn school was one that the Minister said had to be built in a hurry and they ran into problems there. I want to go back to the visitor reception centre.
I was always under the impression that when we talked about the visitor reception centre, it was going to be built next to the Transportation Museum. That is what we were always told. I was somewhat surprised when I drove by there a while ago and saw the construction site over in the little area where the airplanes are parked. Anyone who has lived here for any length of time will know that that was once a swamp. Both sides of the road were covered in swamp, and someone has hauled gravel and backfilled there. There are no beddings or footings in that area. I am sure they found that out once they began construction and drilled a hole in the ground. Once they got about four feet through the gravel that is there, they probably found that it was nothing but muskeg, bog and permafrost. I wondered why that was not picked up on prior to construction.
The government has been around for a long time in the Yukon and people know what is going on. Soil tests have been done all along the Alaska Highway in the area from approximately the Airline Inn to the turn-off to the old radar site, and both sides of the road consist of a bog. If you have ever tried to walk through there, you will find red clay and puddles all over the place. Someone hauled in a bunch of gravel and covered it up. It is almost incredible that that was missed and that someone did not see that ahead of time and plan for that. Somehow we have got to get our act together and carry on with the soil tests, or at least look at the areas where we are going to put the buildings before we put them out to tender. That way, we will know that we can actually construct the building on the chosen site.
Another comment I have is one I have received in the last few months from many people out there about the visitor reception centre. Many people are absolutely shocked when they look at the building and they feel it is the strangest building they have ever seen in their lives. It has been described as a beached whale, an overturned canoe, and all kinds of other things. It is a gross expenditure of the taxpayers money for what we are getting - over $3 million before the building is going to be complete, including the grounds.
We live in the Yukon. That thing looks so un-Yukonish and terrible that I do not know how anyone could associate it with anything in the Yukon. If we had built a building that looked like the Yukon, like our history and heritage, it probably would have cost us a quarter of what that building costs. You could have had the home for the mentally handicapped and a half-dozen other buildings in this town if you had used some common sense and did not hire a bunch of airy-fairy architects to design something that supposedly represents the mountains, the water and the flowing streams. It does not make any sense to normal, average Yukoners, when they look at that building. I have never seen anything so ridiculous in my life.
The government should come back down to earth and realize that they are building these buildings for the people of the Yukon and should take that into consideration, instead of hiring these architects from the middle of nowhere to design these buildings. It is certainly unique, I have to admit that. It is unique in the world, but I do not think it is something we can be very, very proud of.
Hon. Mr. Webster: I want to thank the Member for his comments. I would like the Member to offer us some examples of what he considers to be a typically Yukon building.
Mr. Phillips: I am not an architect, but I have seen a lot of buildings in the Yukon - the Burwash Museum, and other museums in the territory that are built out of logs and look typical to the Yukon and the heritage and past we have here in the territory. Even the museum looks five million times more Yukon-ish than the beached whale we have on top of the hill.
Hon. Mr. Webster: I want to thank the Member for his offerings. I want to remind him that the Government of the Yukon does not really want to dot the Yukon landscape with log buildings. We have a very attractive visitor reception centre in Dawson City, which is made of logs. In fact, it is an exact replica of the old Northern Commercial building on Front Street in Dawson. I do not think it is realistic to build every visitor reception centre out of logs.
Mrs. Firth: I have to agree about the design of the building. I know the Minister thinks lots of people were consulted and that everyone in the Yukon had a chance to have some input, but they really did not. When the picture appeared in the paper just last week, I had people phoning me in absolute shock. They wanted to know how this happened. People from the Whitehorse North Centre and Whitehorse West ridings phoned me to ask how the government could do this when we did not know anything about it.
The government does live in its own isolated little world where they think everybody knows everything it is doing because it had communications coordinators to write press releases about what a great job it was doing and how wonderful it is, but I am trying to tell the Minister that there are people out there who do not know how he slipped this thing by them. They are not happy with the design of the visitor reception centre. I was not happy with it, and I expressed that at the time the Minister made the announcement. I agree; I think we could have built a more practical building with a more simplistic structure to it that could have been just as functional and just as appealing to the tourists.
I know it is going to become one of the attractions of the world. People are going to say get up to the Yukon and take a look at their visitor reception centre; it is the strangest thing you ever saw. The Minister probably thinks that is a good idea: we are going to get people from all over coming to see the eighth wonder of the world, and that is great.
I know the Minister wants to get up and defend his visitor reception centre so I will let him do so, but after he has finished I would like to follow up on what the Minister of Government Services has to say about his departments rewriting of the regulations. I would like to get an update on how that process is going. It was publicly indicated to us that it would take about six months, which is about now, so I would like to get an update on its status. I am already aware that someone has been hired to spearhead the rewriting of the regulations, either alone or seconded from another department. That person is Mr. Rumscheidt. Perhaps the Minister could tell us why that process is happening and just what is going on.
Hon. Mr. Webster: It is very clear that the Members for Riverdale South and Riverdale North do not like the design of the Yukon visitor reception centre and also, to be fair, a number of Yukoners have taken the time to call the Member for Riverdale South, and possibly the Member for Riverdale North. She has asked the question, rather rhetorically, of how many people were consulted in this process. I want to explain to the Member that we did not hold a design contest and say, come up with a design for a new visitor reception centre, and then wait for a month to get 200 entries. That was not the purpose at all, and that is probably what you would have got.
I know, for example, that the Yukon Chamber of Commerce issued a challenge to Yukoners to come up with a new design for a logo that would tell everybody that a product was Yukon-made. They had a nice little select committee of five or six members. They received 100 entries, and the committee made a selection. Lo and behold, it turned out that 80 percent of Yukoners did not understand it, did not like it and wanted to see a new one. That is what is going to happen every time you hold a design contest.
So, that was not our purpose. By having a committee struck with people who represented a number of Yukon-wide organizations, which I have already mentioned here today, I thought we would get some very good input as to what design they thought would be appropriate for that particular kind of building.
The Member for Riverdale South said that last week her phone was ringing off the hook from all kinds of constituents asking where this design came from.
I do not know where they were a year ago when this whole story broke. We had the pictures in the newspaper. I guess they were asleep then.
It comes down to this: she has had many, many phone calls complaining about the design of the Yukon visitor reception centre. Maybe she even got them last year, and she just combined last weeks and last years calls together. I want to put this question to the Member opposite: how many people does she think would call her personally to tell her how much they really liked the visitor reception centre, to say how unique it was, how functional it was? None.
Mrs. Firth: That is because nobody likes it except the Minister and his committee, who sat around and drank coffee and thought this was a great idea.
Mr. Brewster: I would like to point out one thing about tourism. This has frequently been mentioned in this town. There is absolutely nothing here except the riverboat that belongs in this city. The fancy new million-dollar, billion-dollar federal building, which is out of place completely, is an absolute disgrace. Now you are building this one. The Workers Compensation Building does not blend in.
Let us not say you cannot do this. In Banff or Jasper...
Mrs. Firth: (Inaudible).
Mr. Brewster: Would you let me finish, please, Mrs. Firth? Thank you. It is getting so you cannot even talk in here anymore without someone yapping all the time.
In Banff and Jasper they require so many square feet of rock from the areas that have to be used. Every design is different, but they have buildings that fit into those mountains. We have done nothing. The federal government goes one way and the territorial government goes another. We have nothing in the city. Tourists will tell you that Whitehorse is just another city. It has not blended in. It does not blend into the river or anything else.
I am no architect, but there should be a system set up where all these buildings will have a certain style that belongs in the Yukon. It has been done all over the world. I do not know why it cannot be done here.
Chair: I would like to remind Members that we are on Government Services.
Hon. Mr. Webster: Yes, Madam Chair, we are on Government Services, but we are talking about design and architecture and what suits the Yukon. It is an appropriate item for discussion for all Members to join in here.
The Member for Kluane has made some good comments, but I would bring to his attention that there have been some buildings built recently that take advantage of the surroundings. An example is Closeleigh Manor. McBride Museum is another good example, with, obviously, some help from the territorial government in that regard. The design for the new extended care facility across the river will fit in very nicely with the surroundings. There are many examples of that. The visitor reception centre in Watson Lake fits in very well with the theme of that community at that particular place.
There are other examples that I will admit do not lend themselves well to the character of the country. That is quite consistent with most buildings put up by the private sector as well.
Mrs. Firth: This is related to Government Services. The Minister just mentioned a building - Closeleigh Manor - which is a great looking building. I agree that we should have more buildings like that. It would be interesting to know about the practicality of the construction of the building and how functional it is. It looks great on the outside but I believe they just cut holes in all the walls in the suites in that building. They had to jack all three floors up in that building. The building was starting to sink. The elevators were sinking. The air system does not work. There is more to it than just the appearance of the building.
When we are debating Government Services, I would like to ask the Minister if we are taking into account the soil testing. Are we looking at the functional ability of the building and the aesthetics of the building? Is the building suited to the country and do people find it pleasing? I think we have to take all of those things into account. Perhaps all of these factors have not been taken into account in some of the buildings that are being built in the Yukon, and there are a lot of them. We are starting to have a lot of difficulty with extra expenses due to maintenance and the way some projects have been tendered. Perhaps the Minister could take that as constructive criticism and we could get on with the update about the regulations.
Mr. Lang: I have a question for the Minister of Government Services about Government Services and how they do business. I did have a number of complaints about the travelling road show that was undertaken by the Department of Government Services to go outside to try to encourage other organizations to come up and bid on YTG contracts.
Can we have an undertaking from the Minister that we are not going to be going out again to try to recruit other contractors here, other than what is normally done through advertising, as opposed to sending personnel outside the territory for that purpose?
Hon. Mr. McDonald: I will deal with Mr. Langs question first, then Mrs. Firths question second, only because I can deal with Mr. Langs question quickly.
We dealt with the issue of the travelling road show quite extensively during the spring sitting of this Legislature. I have explained on numerous occasions that the road show, as the Member characterizes it, the trip taken by Government Services personnel, was not designed to encourage people to bid on Yukon projects. It was to inform the contracting associations of the business incentive policy, which is brand new. Under the old one, we were being sued by Kline Construction of Edmonton on its constitutionality, and we felt it was appropriate at the time to explain the new business incentive policy to the contracting associations, and we did just that.
With respect to the contract regulation review, I must point out that the regulations we are reviewing are only the tendering regulations. As I indicated before, this is a commitment made by Roger Kimmerly in 1987, and again by my colleague, Maurice Byblow, in 1990 - a commitment he reiterated following the business incentive policy amendments.
After I had announced this project in the spring sitting of the Legislature, an industry advisory committee was struck, which included representatives of the Whitehorse Chamber of Commerce and the Yukon Chamber of Commerce, the Contractors Association, the Consulting Engineers Association and the Consultants Association.
They had their first meeting in the spring, after which time the Department of Government Services issued a discussion paper. The stage we are at right now is the second draft of a rolling discussion paper dealing with tender regulations. The regulations ultimately will be produced by Justice.
In terms of timing, I am hoping that by December we will have drafts of the regulations for the committee to consider.
I have no knowledge of what Carl Rumscheidts job is; I do know he was working in the property management section of the Department of Government Services on the building development directive - the directives and the manual we were discussing earlier; he is now working on this contract regulations project.
The basic principles upon which the new tender regulations will be based include a number of features. First of all, there should be no contract types. There should be a single process for all contract types for the sake of simplicity; that standing offer agreements should be contained within the regulations; that the evaluation of bids should be undertaken only according to criteria that are identified in the invitation to bid itself; that it should be written in plain language; there should be no specifications that would artificially limit competition; and there should be a properly defined appeal process.
Apart from that, I do know that the rolling draft discussion paper has been considered, as I have mentioned, by the committee and I believe it is at the second draft stage and is being revised constantly as we undertake the consultations.
Mrs. Firth: I would like to ask the Minister a couple of questions. My first question is with respect to the delegation that did go outside; they were providing the tender specifications to the Western Construction Associations and I would like to ask the Minister if he is continuing to provide the tender specifications of the capital projects going on here in the Yukon. Secondly, I would like to ask him about the regulations. Will we be able to see a copy of the proposed new regulations in the draft stage prior to Cabinet bringing them into force. I gather if they are regulations, they do not have to come to the House. The Cabinet can do that on its own and then we read about it in the Gazette. I would like to ask the Minister if he is prepared to bring the regulations into the House for debate or at least provide us with a copy of the regulations prior to them being brought into force.
Hon. Mr. McDonald: If the contract regulations and consultation process are completed, I will undertake to deliver them to Members if they wish, whether we are in the House or not. But it must be after we have completed the consultation process and before we take them into Cabinet.
With respect to large projects, my understanding is that we have always delivered the tender specifications to the contractors associations in the south. I have indicated to the department that there should be no change in the policy, if the policy has been a long-standing one. Whatever they were doing before, they should continue to do. They should not do it more or less.
Mrs. Firth: When I spoke to the Edmonton Construction Association, they said they had not received these tender specifications in the past. Yet, they are receiving them now. Perhaps the Minister could check up on this. It is fairly evident that they were quite delighted to be getting them, because it saved them having to look in the newspaper ads Looking for business.
I would like the Minister to check that policy to see whether they are departing from what happened in the past. I guess it would be interesting for us to know just how many western construction associations are being provided with the tender specs and what the Minister means by major projects. Just how many of the tender specifications are these western construction associations getting?
Hon. Mr. McDonald: I cannot remember the dollar limit but it is certainly very significant. I can recheck that point. I was aware of all of those details but they have slipped my memory.
With respect to the matter of whether or not the tender specifications were submitted to the contractors associations, I am afraid the Department of Government Services have been sending these tender specifications for large projects out to the contractors associations. I checked this with them because this was very much an issue in the spring and I do not see what more I can accomplish by checking with them again because I did check very thoroughly with them to be sure that what we were doing now was no more and no less than what we have always been doing. They do say that they have been sending these specifications out to the contractors associations and they have been doing it for a considerable time. I cannot offer anything more than that.
Mr. Lang: The Minister referred to the fact that there was a lawsuit and that the government was taken to court with respect to the constitutional aspects of the previous business incentive program. Can the Minister update the House on exactly what took place as far as that lawsuit was concerned? I believe that he mentioned the name of Kline Construction.
Hon. Mr. McDonald: Kline Construction is a company based in Edmonton that submitted a bid on the Robert Service School when that was first let for tender. They were the low bidder, but their bid was not accepted for more than one reason.
The main reason was that they were not a registered company under the business incentive policy. In those days, you had to be a registered company to qualify to bid on Yukon projects, and they were not.
The next low bidder was Jaemar Construction, which was a registered company in the north. They were awarded the contract. At the time of the tender, Jaemar indicated a desire to take the government to court on the constitutionality of the business incentive policy.
I checked a few weeks ago on that status of that court case. My understanding is that it has not actually reached court. I do not know whether it is in examination for discovery or not, or whether we are simply at the threatening stage. It certainly made a lot of noise at the time. I know that it has not yet gone to court. The lawyers have not presented a case. I do not believe it has gone for examination for discovery, either, but they have threatened to carry it further on a number of occasions.
Mr. Lang: I want to deal with the issue of Closeleigh Manor. It is the building next door here. I believe there are some significant structural problems with that building, which is virtually brand new. It is four or five years old. I want to know from the Minister what fallback do we have to all the engineering that was done on the facility, or the inspection, or whatever. Is the government just going to take responsibility for the whole structure and have to pay for whatever the costs are for reconstruction, or do the companies that built it have to take some responsibility? What is going on over there is a tragedy.
Hon. Mr. McDonald: I can undertake to pass the information on to the Yukon Housing Corporation. They were the construction managers of the project, jointly funded with the Central Mortgage and Housing Corporation. Yukon Housing was the responsible agent. I am certain that I will pass this on to the Minister responsible for the Yukon Housing Corporation.
I see that the time is getting late. I move that you report progress on Bill No. 18.
Motion agreed to
Hon. Mr. McDonald: 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. 18, Second Appropriation Act, 1991-92, and directed me to report progress on it.
Speaker: You have heard the report of the Chair of Committee of the Whole. Are you agreed?
Some Hon. Members: Agreed.
Speaker: I declare the report carried.
Hon. Mr. McDonald: I move that the House do now adjourn.
Speaker: It has been moved by the Hon. Government House Leader that the House do now adjourn.
Motion agreed to
Speaker: This House now stands adjourned until 1:30 p.m. tomorrow.
The House adjourned at 9:27 p.m.
The following Sessional Paper was tabled November 27, 1991:
Health and Social Services Annual Report for the year ended March 31, 1990 (Hayden)