Whitehorse, Yukon

Tuesday, December 3, 1991 - 1:30 p.m.

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


Speaker’s Ruling

Before proceeding with the Daily Routine, the Chair would like to provide a response to the question of privilege raised by the Member for Whitehorse Porter Creek West on November 25, 1991. He was basically disagreeing with a ruling that the Chair had made on a point of order raised by the Member for Whitehorse Riverdale South on November 12, 1991.

In that ruling, the Chair had said that he would not recognize the Members for Whitehorse Porter Creek West and Whitehorse Riverdale South to respond to Ministerial Statements until the House had decided, and so advised the Speaker, that the Independent Alliance was to be recognized as a party.

The usual method of proceeding, when challenging a ruling of the Chair, rather than raising a question of privilege, is to move a substantive motion with the purpose of having the Chair’s decision overturned.

A second point to be made is that the House, on December 2, 1991, would appear to have dealt with the Member’s grievance by concurring in the Second Report of the Standing Committee on Rules, Elections and Privileges. Because the issue raised by the Member for Whitehorse Porter Creek West seems to have been resolved, I do not think it would be appropriate to deal any further with the matter right now.

Of course, the Member may, as I have suggested, pursue this matter through a substantive motion.

On a related matter, I would like to cover some items that arise from the Second Report of the Standing Committee on Rules, Elections and Privileges. Although the committee did not reach a decision on whether the Independent Alliance is or is not a party, it recommended that the Independent Alliance should be accorded privileges as it if were a party.

In accordance with the direction provided by the House, through its concurrence in the committee report, the Chair will now recognize a Member of the Independent Alliance during responses to Ministerial Statements.

The rotation for Question Period will also change. Before today, the Members for Whitehorse Porter Creek West and Whitehorse Riverdale South were given questions 6,7,13 and 14 during Question Period. They will now be given questions 3,7,10 and 14. This follows the practice, which has been in place since July 18, 1985, of the Leader of the Official Opposition having the right to ask the first two questions and the leader of a third party being given the third question. It also conforms exactly with the rotation that was in place during the 1985 fall sitting, when the opposition was made up of five Members of the Official Opposition and two Liberals.

One last point. The Chair will continue to be responsible for deciding the order in which Members will be recognized during debate, but I would point out that the establishment of a speakers’ list prior to debate seems to have worked well for the House in the past. The Chair would encourage the House Leaders to work on continuing that tradition.

We will now proceed with the Daily Routine.


Speaker: Are there any Returns or Documents for Tabling?


Hon. Mr. McDonald: I have a document for tabling.

Speaker: Are there any Reports of Committees?

Are there any Petitions?

Introduction of Bills.

Notices of Motion for the Production of Papers.

Are there any Notices of Motion?

Are there any Statements by Ministers?

This then brings us to the Question Period.


Question re: Yukon Energy Corporation/administration fees

Mr. Lang: I want to once again turn the Members’ attention to the outstanding issue that has been dominating the news for the last number of months. That is the question of the Yukon Development Corporation and the mismanagement and misuse of electrical consumers’ dollars. We have learned in this session, in the last number of days, that the government has finally admitted that they spent $10.9 million of electrical consumers’ dollars on the sawmill. We have also been notified that the president of the Yukon Development Corporation, Mr. Cable, resigned over the principle of the relationship between the government and the corporation. I might add that, as days go by, more and more is revealed in this House and one becomes more and more sympathetic to Mr. Cable and to the reasons why he resigned.

Just recently, the 1990 board of directors tabled a document in this House with respect to the financial accounting for the past year for the Yukon Development Corporation. In that document, the corporation charged...

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

Mr. Lang: Yes, Mr. Speaker. I want to know why the Yukon Development Corporation is charging $1.7 million for administration fees when, at the same time, the management fee for the day to day operations of the electrical needs of the Yukon is being done by Yukon Electrical Company for $695,000. Could the Minister tell us why $1.7 million is being charged to the consumers of electricity for the Yukon Development Corporation.

Hon. Mr. Byblow: The Member, as usual, has bootlegged a number of inaccuracies into the record in his preamble. This government did not spend any money on the Watson Lake sawmill; the money that was spent in respect to the Watson Lake sawmill was money spent by Yukon Development Corporation.

The Member is also aware that, in 1987, when the assets of NCPC were taken over, this government provided some $30 million directly toward the purchase of those assets. It was provided to the Yukon Development Corporation as an investment on behalf of the people of the Yukon to be able to affect power rates.

Those rates were affected; for a four-year period there was no increase - in fact, there was a decrease. On the strength of that investment and on the strength of the utilities board hearing last week the Development Corporation, and the Energy Corporation in particular, came through with a clean bill of health on the sound financial management of the corporation. So, it is entirely erroneous and misleading for the Member to bootleg that kind of inaccuracy into the record.

The question the Member posed was posed yesterday, and I undertook to provide Members with the respective detail of the $1.7 million expenditure related to administration. I will do so, and it will be tabled tomorrow.

Mr. Lang: This document has been in the House for approximately a week and one-half. In that document, it is very clear that the corporation is charging over $1.7 million to the electrical consumers for the running of the Development Corporation and at the same time ...

Speaker: Order please. Would the Member please get to the supplementary question?

Mr. Lang: Yes, Mr. Speaker. At the same time, $700,000 was paid to Yukon Electrical Company. I would like the Minister to tell me why this question has never been raised before. Why is so much money being charged to the electrical consumer while, at the same time, we have a $700,000 management fee for the day to day operations of the energy grid?

Hon. Mr. Byblow: If the Member had really been serious about energy rates in the territory, he would have appeared as an intervenor at the utilities rate hearing last week, where all of the information was tabled. The $1.7 million expenditure and the $695,000 management fee were tabled information in detail at the rate hearing last week. I am having that material copied and will be tabling that information tomorrow.

Mr. Lang: We know where the change has to come with the Yukon Development Corporation, and that is through the political arm of government not through the Yukon Electrical Company or the Public Utilities Board. There is a private Member’s bill before this House that would do just that.

I want to ask the Minister how he can justify the $1.7 million as an administrative charge to the electrical consumer in the Yukon for a Development Corporation that employs at any time a maximum of eight employees. That is over $200,000 per employee.

Hon. Mr. Byblow: Once again, if the Member had appeared at the hearing last week, or if he had spent time listening to the hearing, he would have had that very question answered.

As corporation officials explained at the rate hearing last week, the expenditure is far less than it would be if Yukon Energy had its own staff and forces doing the work that Yukon Electrical Company Limited is doing on its behalf.

Question re: Yukon Energy Corporation/administration fees

Mr. Lang: I am not asking about the management fee schedule from the Yukon Electrical Company, I am asking about the administrative charges that the Yukon Development Corporation has been charging consumers over the past number of years.

In 1988, there was over $1.5 million charged to the electrical consumers in Yukon for the administrative charges of a corporation. At any give time, there was a maximum of eight employees. Will the Minister provide to this House a total breakdown of that $1.5 million and how it was spent in 1988?

Hon. Mr. Byblow: The Member is not only not listening but he is spinning his wheels and wasting our time. I said that I would provide a full breakdown of those figures. I said that yesterday and I repeat it today. The information will be tabled tomorrow. The Member should have taken the time to appear or spend some time at the rate hearings last week where those figures were provided to the utilities board, line by line, expenditure by expenditure item, and they are included in the financial statements.

The corporations have an open-book policy in regard to their financial matters. They presented a clean bill of health before the utilities board last week. I will assist the Member by providing that information in the House tomorrow.

Mr. Lang: I am not talking about just this past year. I am talking about 1988. I would like a breakdown of the administrative dollars for that year. In 1989, a total of $1.38 million was charged to the electrical consumers of Yukon to pay for the administrative charges of a development corporation, which had a maximum of eight positions. Would the Minister provide to this House a breakdown of how that money was spent, including any contracts that were let through that administrative portion of dollars?

Hon. Mr. Byblow: I am not going to quibble with the question. The Member asks a reasonable question to seek information. But I have to tell the Member that that kind of information has, no doubt, been tabled in this House before. Previous Ministers have provided details surrounding those administrative expenditures, but I will do the Member’s homework; I will ask the Yukon Energy Corporation officials if that information can be provided again.

Mr. Lang: In three years, over $4.6 million has been charged by the Yukon Development Corporation for administration. It was paid for by the electrical consumer. At the same time, almost $700,000 a year was paid to the Yukon Electrical Company for the day to day operations of our energy needs.

Has the Minister ever questioned the need for the Energy Corporation to pay this much money every year, over and above what is already paid through management fees to the Yukon Electrical Company?

Hon. Mr. Byblow: How can I help educate the Member? On the one hand, Members opposite say that the Minister is interfering in the business of the corporation. Then they expect me to know every detail, irrespective of the fact that the two corporations are set up as business entities to operate at arm’s length from the government and are run as business corporations. Their books are open and financial statements have been tabled annually in this House.

As well, the Yukon Energy Corporation places its records before the utilities board every year, where Members have the opportunity to examine every expenditure item, if they wish. Nevertheless, I will be obliging. I will be cooperative. I will seek the information the Member is requesting. I will let him know in a tabled document where the $695,000 is spent, as a management fee - not to Yukon Electric but to Canadian Utilities Limited, the parent company - for extraneous services, as well as the $1.7 million. The $1.7 is strictly administrative costs, which have already been itemized at the rate hearing. I could probably go back several years if the Member wishes.

Question re: Yukon Development Corporation/RCMP investigation

Mrs. Firth: My question is to the Government Leader. Years of controversy at the Yukon Development Corporation and the Yukon Energy Corporation have been followed by a pay out of Mr. Alex Raider, a former president of the corporation and the untimely resignation of another president, Jack Cable. I understand now that the shredding machine is operating overtime at the Yukon Development Corporation and Yukon Energy Corporation offices late at night and bags of shredded documents are being hauled out of the offices.

I would like to ask the Government Leader to report to the House on the status of the RCMP investigation of Mr. Alex Raider and the Yukon Development Corporation.

Hon. Mr. Penikett: I guess the Member has reached new lows today. Let me say, for the record, as she ought to know, I have no knowledge, whatsoever, of any RCMP investigation. She is doing it again; it is just despicable.

Mrs. Firth: Just because the Government Leader does not know what is going on does not mean it is not going on - and it is going on. So perhaps we could recommend to the Government Leader that he find out exactly what is going on. He was the Minister when this started.

Will the Government Leader check it out and report back to this House on the status of this investigation?

Hon. Mr. Penikett: The Member opposite moves from allegations about shredding of documents and bags of documents to an RCMP investigation. She speaks of an Orwellian scenario - no facts, but an allegation, a suggestion that there is an RCMP investigation of someone. The RCMP do not report to us. They are not accountable to us. I have no knowledge about what the RCMP is doing. As a purely practical question, I do not intend to phone the RCMP and ask if they are investigating the Member opposite or the Member for Porter Creek West, or anyone else.

Mrs. Firth: That is interesting coming from the Government Leader, who has ordered RCMP investigations himself, against Members of this House and our offices.

Will the Government Leader check this out. Will he report back to this House and tell us who ordered the investigation, why it was needed, when it started and what stage it is at now? Will he report back to the House with that information?

Hon. Mr. Penikett: Well, I am sure the Member has got what she wants, her headline. It does not matter who suffers as a result or whether the accusation or the implied accusation is wrongheaded or not.

For the record, I have never ordered an RCMP investigation because I do not have that power. When we had theft of public property - of government documents - we did ask for an investigation and, I believe, any responsible administration would do that.

Question re: Tagish community well

Mr. Phelps: I have some questions of the Minister of Community and Transportation Services - a refreshing change of pace for him - concerning the on-again/off-again Tagish community well, which, the Minister will recall, was in the budget for year after year, and finally, about a year ago, a well was drilled. It had to be delayed while they applied for land around the well. This year we finally have the complete building up and running but the problem is that the well is dry. The pump will only go on for about 20 seconds and then there is no water, so it turns off. Nobody in Tagish is able to use the community well, and I am wondering what plans the Minister or his department have to remedy the situation.

Hon. Mr. Byblow: The other day, I had one on the Member by knowing about a meeting in his community the night before, when he did not know about it; today, he has one on me because I am not aware that the well is dry or that it is not producing water as originally intended and, I am sure, as originally tested. This is news to me, because I am also quite keen to have that facility and service in place. I thought we were there already.

Mr. Phelps: After three years, the answer is no. While we are on the subject of secret meetings that are being held in my riding, I would really appreciate the Minister undertaking to have his officials advise me of these meetings before they go out there. That did not occur with the one in Carcross; it has not occurred with the one scheduled for tomorrow night in Tagish, although I will be there because the residents told me about it.

Would he undertake to make sure I know about these meetings, which they seem to like to hold on Wednesday nights in order to try to avoid having me present? I am always helpful at these meetings, whenever I can be.

Hon. Mr. Byblow: The Member knows that I am one of the most cooperative persons when it comes to sharing information and the problems in his riding.

The Member will recall that I invited him to chair a public meeting, not very long ago. I would observe that the Member did a fine job of chairing a difficult meeting.

My answer to the question is yes; I will undertake, where my department is involved and where public meetings are involved, to share that information with the Member, if I know.

Mr. Phelps: I hope that the Minister appreciates the difficulty I have with about seven or eight unique communities contained in the riding. When these meetings are set up all of a sudden, it is sometimes impossible for me to be advised, especially when I am in the House.

Question re: Yukon College equipment replacement

Mr. Devries: I have a question for the Minister of Education concerning the replacement of equipment at Yukon College. Does the Minister feel that the Department of Education is providing adequate funding for equipment upgrading at Yukon College?

Hon. Mr. McDonald: As I recall, the capital allocation for the college incorporates two line items: the first is $190,000 for equipment and the second is $200,000 for facilities. The college has the authority, of course, to move its expenditure priorities around and they can spend all of the funding on equipment if they wish. That is the figure that was budgeted in the main estimates, and that is the figure that we are seeking approval for in the House during this sitting.

Mr. Devries: Does the Minister know if a needs analysis has been done to see if students are receiving hands-on training with up-to-date equipment in their studies at the college.

Hon. Mr. McDonald: I am afraid that the Member is going to have to be more specific about the line of questioning he is pursuing. If the Member is asking whether or not I would be prepared to go up to the college and ask for a needs analysis of all equipment to determine whether or not it is absolutely up-to-date and still useful, I am afraid I will not put that administrative burden on them. If there is a particular piece of equipment or a particular situation that the Member feels requires some attention, namely that better equipment should be used in a particular training program, then I am sure he can pass that information on to me.

If that particular need is considered a high enough priority, then I would trust the college would allocate their priorities in order to cover that particular situation.

Mr. Devries: I have received several concerns that some of the equipment in some areas is not up-to-date. There is a concern that the students will not be ready to enter the existing workforce in the proper manner. Has the Minister received requests to increase the capital budget of Yukon College so they can address those needs in a more realistic manner?

Hon. Mr. McDonald: The Member has not expressed what needs it is that he is talking about. He has made a generic observation that the equipment at the college is substandard. I know for a fact that there is equipment at the college in the trade shops, kitchen and library that is absolutely first-class and absolutely state-of-the-art.

If there is some equipment in a particular program that the Member is concerned about not being up-to-date or not being sympathetic with the tools of the trade in the existing private sector, then I would ask that the Member please identify those areas so I can respond more reasonably instead of simply responding to the general allegation that we need to have a needs analysis and that something is happening in some programs. I need more information.

Question re: Ambulance service training

Mr. Brewster: My question is for the Minister of Community and Transportation Services regarding training standards for the ambulance service.

Three emergency medical assistance level 1 courses have been scheduled for 1992. The first will be in Whitehorse. Will the Minister consider having the other two courses in communities outside of Whitehorse?

Hon. Mr. Byblow: I will take notice of the Member’s suggestion. I am not familiar with the details of where training programs are occurring or precisely when they are taking place. I have provided to the Member ongoing information in the past. I will take his suggestion as notice and investigate.

Mr. Brewster: I would like to thank the Minister for that answer. Four of the people who will be attending the first 10-day course are from outside of the city. They are all volunteers and as such, will lose 10 days’ wages in order to attend these meetings. Will these volunteers be reimbursed for their lost wages?

Hon. Mr. Byblow: I am not familiar with the policy of renumeration for ambulance attendants at training programs. I will undertake to investigate the question.

Mr. Brewster: The basic trauma life support training program is by far the most popular training requested by rural members of the ambulance service, yet, the Minister told me, in a recent letter, that his department is only reviewing this program. Will the Minister have his department consult with the rural members regarding making ambulance training programs a priority?

Hon. Mr. Byblow: In general terms, I can tell the Member that there is ongoing consultation with stakeholders. Some time ago, officials of my department visited every ambulance centre in the Yukon and spoke to ambulance attendants and representatives of communities. Community consultation is ongoing. It does happen. However, in light of the Member’s question, I can duly note his request. I can assure him that it is ongoing.

Question re: Yukon Development Corporation/RCMP investigation

Mr. Nordling: My question is for the Government Leader. It is a follow-up of the question by the Member for Riverdale South.

My understanding is that Alex Raider had a long-term contract at a salary between $80,000 and $100,000 per year. He was only with the Yukon Development Corporation for one year. I would like to know if the balance of the contract was paid out when Mr. Raider left.

Hon. Mr. Penikett: As the Member no doubt knows, Mr. Raider left our services when his wife became a quadriplegic, following a serious operation. She required around-the-clock care. Mr. Raider left with severance arrangements according to his contract. As Members will know, I am not at liberty to reveal personnel details beyond that on the floor of the House and beyond what is already public.

Mr. Nordling: It was the taxpayers’ money that paid Mr. Raider this golden handshake, and consumers are now being asked for a rate increase to pay for this sort of expenditure. I would like to ask the Government Leader why this information is not available.

Hon. Mr. Penikett: I am not sure I am going to dignify the rather unsavoury suggestion made by the Member that somehow the electrical consumers are going to be suffering a huge burden as a result of Mr. Raider leaving under the circumstances that he did.

Of course, as a matter of public policy, there are a few objectives one has to maintain. One would be the right of the public access to information.  No government reporting to this Legislature, whether it is this government or the previous government, has ever released personnel details about the precise salary of an individual, without that person’s consent. It has been the custom to provide the range of the salary offered and that is the practice that we continue to observe.

There is no doubt that the practice that was observed by the Members opposite when they were in government is constantly under attack by them in opposition, but perhaps that is a policy question that we will have to address. We have not seen fit to change the policy yet.

Mr. Nordling: The Government Leader said that he would not release this information without the other person’s consent. Did the Government Leader or the new Minister in charge make an agreement with Alex Raider that the amount of his pay out, his golden handshake, would remain secret and that he refused to authorize the Government Leader to provide us with that information?

Hon. Mr. Penikett: Again, the Member is gaining a reputation for more and more odious conduct every day in the House. The fact of the matter is that the member left our services, and the severance terms were according to the terms of his contract when he entered our service.

Question re: Riverdale traffic

Mr. Phillips: The Minister of Community and Transportation Services and I have addressed the issue of the traffic flow in and out of Riverdale several times before. The problem is becoming ever more complicated with the opening of the Department of Education in the Old Yukon College building.

Members of this House have experienced the sound almost every evening now when we are in the House, of emergency vehicles, around 5:00 p.m., heading over to the hospital and into the Riverdale area. There is an increasing concern that access for emergency vehicles is becoming more difficult during the rush hour times in the morning, at lunch hour and in the evening.

Has the Minister given any more consideration to the Government of the Yukon sitting down with the City of Whitehorse to work out a financial arrangement to upgrade the traffic-flow patterns in the hospital, bridge and South Access turnoff areas?

Hon. Mr. Byblow: The short answer to that is that the subject of the Riverdale bridge access will be a subject of discussion at the anticipated early January meeting with the city council. I have met with the new council on two occasions already to deal with a number of issues facing the city and which, at the same time, involve the Yukon government.

The matter of the access to Riverdale was dealt with with the previous council. It was also dealt with as the subject of a study several years ago, in 1988, I believe. The Member and I do not agree on the content of that study but, as that study pointed out, the impact of the new Education building does not change the traffic density from what was previously there.

Nevertheless, as the Member correctly notes, there is a developing congestion problem, and it is something I intend to raise in my next meeting with the city in early 1992.

Mr. Phillips: The announcement made by the Minister here today that the traffic flow problems have not changed is not the opinion of all the Riverdale residents who are lining up every day to go in and out of Riverdale; they are quite concerned about the traffic flow problems and about getting emergency vehicles into the area.

The Minister is going to meet with city officials in early January. I would like to ask the Minister if he would give strong consideration to urging the city to speed up the process. We have been talking about it for five or six years now; the problem is getting worse every year and now an extended care facility is going to built and opened in the near future, which will add to the problem. Would the Minister talk with the city officials and encourage them to speed the process up so that we can fix this problem as soon as possible - not four or five years from now?

Hon. Mr. Byblow: I agree with the Member that there is a developing traffic congestion problem and it is one that, indeed, has to be solved. Fundamentally, it is the city’s problem, and while certain infrastructure developments may contribute in the future to that congestion problem, there is clearly a need for both levels of government to address the nature of the problem.

Those kinds of discussions periodically take place at an officials’ level. Certainly, at the time that the planning for the extended care facility was taking place ...

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

Hon. Mr. Byblow: Discussions did take place surrounding the impact of that facility. The hospital is another infrastructure development where some impact will be felt and those future considerations will be the subject of January’s meeting.

Mr. Phillips: The Minister did not answer my question. I asked if he would consider speeding up the process. The government has contributed to part of this problem - it is not all the city’s problem. We have a new extended care facility, new government offices with a couple of hundred people in them, and we have a new student residence in Riverdale; we have all kinds of government growth in Riverdale contributing to this problem.

I would like to ask the Minister if he would urge the city officials to speed up the process. We cannot wait five years for a new hospital; we cannot wait until we have an accident on the bridge or a big problem in Riverdale - for example, a fire we cannot get emergency vehicles to - we have to address the problem now and I would ask the Minister ...

Speaker: Order please. Would the Member please get to the supplementary.

Mr. Phillips: Thank you, Mr. Speaker. I would ask the Minister if he would urge the city officials to accelerate the process, and would he consider financial support for that process, working in conjunction with the City of Whitehorse, and accepting his responsibility as well?

Hon. Mr. Byblow: I should point out to the Member that matters of development and growth are ongoing subjects of discussion between the city and the government. The entire issue of assigning costs to improved services as a result of infra-structure growth is also the subject of ongoing discussion. As a matter of fact, in land development projects, we are currently finalizing an undertaking where a special charge will be levied for future growth requirements, such as water, sewer and bridges.

In the matter of Riverdale, I will undertake, on the Member’s request, to address the matter of expediting and accelerating both levels of government to deal with problems.

Question re: Building renovations

Mr. Lang: I would like to turn our attention to another issue that has been facing the Legislature, that is the question of expenditures for the renovations of buildings, and I specifically refer to the Elsa recreation centre where $120,000 was spent in 1988 to renovate it, and then two years later the roof caved in. Since that time, I have corresponded with the Minister regarding that building, and I have been informed that a $45,000 contract was awarded to clean up the demolished building. Can the Minister confirm if that is the full amount of money that will be spent to remove the debris as a result of the building being demolished?

Hon. Mr. Byblow: The Member has raised the matter of the Elsa recreation centre on numerous occasions in the past. I undertook, at some length, to provide the Member with extensive detail by correspondence. I cannot confirm, on my feet, whether that is going to be the precise and final amount. That is, if my memory serves me correctly, the amount that the project was tendered for. I cannot see, under that process, where additional funds would be required, if there is an agreement to do a job for a certain price.

Mr. Lang: As all Members know, we spent over $1 million building a curling rink that has never been opened. It has come to my attention that there are now significant problems being felt as far as that particular building is concerned. In view of the fact that the building has never been utilized, can the Minister confirm that the gyproc in that $1 million structure is starting to fall in?

Hon. Mr. Byblow: It is tough having a working knowledge of all the buildings in the territory that we have responsibility for. No, I cannot confirm that. I can undertake, as duly noted by the Member’s question, to indeed determine whether that is correct.

Mr. Lang: There are not that many new abandoned buildings in the territory. I would submit to the Minister that it should not be too hard to keep track of them.

At one time there were ongoing discussions with the community of Mayo about moving the newly abandoned curling rink in Elsa to the community of Mayo. Are discussions still ongoing, and if so, could he update the House?

Hon. Mr. Byblow: I will take notice. I cannot confirm whether discussions are still ongoing or what stage the discussions are at. It is duly noted and I will advise the Member.

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


Notice of Business

Hon. Mr. Webster: Pursuant to Standing Order 14.2(7) which was adopted by the House on December 2, 1991, I would like to identify the order in which Motions other than Government Motions standing in the name of government private Members are to be called on Wednesday, December 4.

They are Motion No. 86, standing in the name of the Member for Tatchun and Motion No. 84, standing in the name of the Member for Old Crow.

Hon. Mr. Webster: 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 Hon. Government House Leader that the Speaker do now leave the Chair and that the House resolve into Committee of the Whole.

Motion agreed to

Speaker leaves the Chair


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


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

Bill No. 18, Second Appropriation Act, 1991-92 - continued

Women’s Directorate

Chair: Is there general debate on the Women’s Directorate?

Hon. Ms. Joe: Under Women’s Directorate we are requesting an additional $127,000 for operation and maintenance. There are two expenditure increases in personnel. The first is for $37,000 for the reclassification of the three positions in the Directorate and increases due to the new collective agreement. This was in regard to the reclassification of all of the positions. Over a period of time, the work load had increased and the responsibilities were much more than what is required of an MG5. There have been reclassifications of all those positions. As well, the amount included in the collective agreement.

An additional $25,000 is required for a casual position to assist in project delivery and policy work for the directorate. The demands on this office increase daily. Over the past five years the directorate has operated with only three person years. The work load definitely has increased. They have taken on many new projects. Space has also been increased in the Women’s Directorate’s offices to accommodate this additional person year.

The directorate is also requesting $40,000 to do a territory-wide survey on Yukon women’s issues and priorities. This is a one-time allotment increase. The money is being requested to conduct this survey. There is a concern, naturally, that many of the agenda items for Women’s Directorates, and therefore governments, get driven by national initiatives.

Jurisdictions feel that it is necessary, in examining the issue of economic equality for women in the 1990s, to get a clear picture of what the issues and priorities are, if we are to develop a workable, long-range strategy to raise the status of women. The Directorate, in its initiatives, is currently working with the Bureau of Statistics.

An additional increase of $25,000 is for transfer payments. The first $10,000 is for the Yukon Advisory Council on Women’s Issues, for increased program costs and office space.

The Advisory Council on Women’s Issues is a very active group of women. They meet on a regular basis. Some women have to come in from outside of Whitehorse to perform their duties.

The additional $15,000 is to go toward women’s organizations. The Members might remember that there was a controversy in regard to the possible stoppage of funding for women’s centers across Canada. That was reconsidered by the federal government but this is just to assist in some of their costs, and to help women’s organizations deal with some of the issues that are very real to them.

Mr. Phelps: I am going to save all my hard-hitting tough questions for the main estimates. I have a couple of questions about the survey. The Minister said it was going to be undertaken in cooperation with the Bureau of Statistics. Is this some kind of a questionnaire that is going to go out to all the women in the territory? Is that the concept?

Hon. Ms. Joe: The questionnaire is being developed right now and it will go out to all the women’s organizations, to communities, to bands and to councils. I do not have an exact listing of all the people it will be going to, but it will be a wide-ranging list of people who will be taking part in it.

When we get into the Women’s Directorate main estimates, I hope to be able to offer more information with respect to that.

Chair: We shall proceed with line by line.

On Operation and Maintenance

On Public Information, Policy and Program Development

Public Information, Policy and Program Development in the amount of $127,000 agreed to

Operation and Maintenance in the amount of $127,000 agreed to

Chair: Are there any other questions?

Women’s Directorate agreed to

Yukon Housing Corporation

IChair: We are in general debate on Yukon Housing Corporation.

Hon. Ms. Hayden: You have before you the supplementary estimates for the Yukon Housing Corporation. The additional budget being requested for approval relates to salary increases.

As the Members know by now, the government signed a new agreement with the bargaining unit, subsequent to the preparation of the current year budget. The $233,000 increase being requested for the corporation’s O&M budget is the impact of this new contract.

I would welcome questions from the Members.

Mr. Devries: I have a few questions regarding this, because, as the Minister is aware, when this one came up last year I was in Watson Lake trying to save the airport. We all know how that went. Most of these questions pertain to the present year.

On what date did the new financial officer assume his or her duties?

Hon. Ms. Hayden: I assume it is the Director of Finance the Member is asking about. The full-time Director of Finance and Administration was hired on August 16, 1991.

Mr. Devries: How many used housing units were sold in the past year by the Yukon Housing Corporation?

Hon. Ms. Hayden: As far as we can recall, there were two units put up for sale during the past year. I will take that under advisement to ensure that I get a proper number for the Member.

Mr. Devries: There seems to be a tremendous shortage of housing in the Whitehorse area, as well as in several other rural communities. Can the Minister outline what they are planning to do to ease this problem, both in apartments and in housing?

Hon. Ms. Hayden: The Member is correct. There seems to be a continual waiting list for social housing, particularly, in Whitehorse. The Yukon Housing Corporation has amended our joint-venture program to permit homeowners wishing to subdivide their homes for rental purposes, to do so. That program would no doubt assist in the availability of units. The program has been well-received by people, but the uptake has been very small, because the City of Whitehorse has not yet completed the changes to the zoning bylaw that would permit this to happen. We expect that may happen fairly soon.

Over recent years, the availability of land in Whitehorse has impeded construction of new public housing units however, over the past two years, we have constructed 55 apartment-type units in Whitehorse. For this, we solicit turn-key and/or design-build programs. We anticipate a need for about 40 housing units in Whitehorse.

Mr. Devries: Is the Minister saying, then, that it should be easier for a private developer to get a piece of property than it is for Yukon Housing?

Hon. Ms. Hayden: As I understand it, a lot of the private developers already own the land. We are attempting to have them build units with our participation. That seems to be some resolution to the land problem.

Mr. Devries: The Minister mentioned that the list of people who were applying for social housing seems to be increasing. Is there a breakdown of who are applying for social housing? My biggest fear is that it is being run more and more to low-income wage earners who do not seem to be able to keep up with increasing inflation costs and what it basically takes to run a family. More of them are starting to look at social housing as a way to alleviate some of their problems. Do we have any statistics to verify this?

Hon. Ms. Hayden: I do not have the specific breakdown for the applicants. I would make two comments. My intent was to say that the demand stays; it does not disappear, so there is a turnover, but the increasing population of the Yukon and the recession has an impact on housing.

People who apply for social housing, other than seniors, must meet the income requirements. That would be somewhere around $35,000 a year, tops. With seniors, as yet, we have not put a restriction on income, because there is no other senior housing available in the territory.

Mr. Devries: Last year, the Centennial Street project was finally completed. Is it full, and is it operating satisfactorily? Have there been any further problems with the structure? It seems there was a real turnover of contractors while that building was being built.

Hon. Ms. Hayden: I am told that the Centennial Street project is fully occupied, and there are no major problems with it. I gather there is some minor work left to be done, but nothing of any consequence, and it will be done.

No, there have been no major problems with the project. It is operating fine.

Mr. Devries: In the past few years, there has been a lot of staff turnover in the Yukon Housing Corporation. It seems to have stabilized somewhat last year. Does the Minister have something good to report on that? Is there still some turnover?

Hon. Ms. Hayden: I am very pleased to report that the Yukon Housing Corporation is fully staffed at the present time. Of the three positions that were terminated in 1991-92, one person left for personal reasons, one left because of other family commitments and one person was dismissed.

The corperation, in my opinion, is operating at full capacity and carrying out its work very well.

Mr. Devries: That is good to hear. It has been a real concern to this side; staff turnover makes it hard to get continuity in programming.

There is one area where I feel there is a weakness. Perhaps it is an isolated case, but it is the area where seniors can access funds to do work on their homes. There is one case that I have been trying to address in Watson Lake where someone’s well was drilled this past summer. The contractor disappeared and now, finally, just two weeks ago, the well was finished. This caused a considerable increase in the cost, because there was three feet of frost to dig through. There was also a question on how well it would be installed. Was this just an isolated incident or is this a fairly common occurance?

Hon. Ms. Hayden:  First of all, I would like to thank the Member for bringing the specific situation to our attention. I recognize that it has been remedied; the well has been drilled and everything that goes with it has been delivered. I share his concern about seniors, as well. As the Member is aware, this program was delivered by an agent. I believe it is a relatively isolated incident. We are discussing that particular incident with the agent and I believe that any problem will be resolved.

Mr. Devries: I do not know if it was a contracting problem or not. I do not feel that a senior citizen, especially one who has recently been through an operation and various other procedures, should have to go through that type of hassle with any department, to have something done.

I noted with interest that last year we were given some statistics on the rehabilitation centre, and the extended care component of the extended care facility that Yukon Housing Corporation is looking at. It says the interest will be 13.50 percent, per annum, and with the present interest rates where they are, I would like to know if we are tied into that interest structure, or does it fluctuate as the rates go down in the marketplace?

Hon. Ms. Hayden: That happened to be the rate that was applicable when it was quoted last year. To answer the Member’s question, we are not tied in to that rate. The current rate is what applies to us, so the lower rate is what we are paying. I am pleased to report that.

Mr. Devries: It is a fluctuating interest rate then, depending upon what the prime rate of interest is.

In the 1991 public accounts, there is mention of $17,268,000 in mortgages. It goes on to say that interest at a weighted average of 11.5 percent and repayment in blended monthly installments will continue until the year 2023. Again, are we tied to that interest rate or is it a fluctuating rate similar to the matter that I raised?

Hon. Ms. Hayden: Before I answer the second part of the Member’s question, I would like to clarify the previous question.

When the extended care facility is complete, the interest rate will be locked in at whatever the interest rate is at that time. We are not locked in to the 13 percent, or the 13.50 percent that was quoted last year. We can only hope that the interest rate will remain low until the facility is completed.

If you will give me a minute, I will answer the second part of your question.

Hon. Ms. Hayden: The $17 million relates to a series of mortgages that are renewed every five years; as they come up for renewal, the interest rate is renegotiated. It is whatever the interest may be or what we can obtain when that mortgage comes up for renewal.

Mr. Devries: One last question: out of this total budget, how much did we Ipay to Ernst and Young for their services prior to the financial officer arriving on the scene in August?

Hon. Ms. Hayden: As the Member is aware, we contracted with Ernst and Young to provide director of finance services to the corporation. The total cost paid for consulting between the period June 19, 1990 to August 16, 1991 was $213,029.

Mr. Devries: I really have no further questions but I would like to ask the Member whether, prior to the main estimates coming up, we could get a list of the contractors who were used in the past year and also a breakdown of the units planned for 1992-93, and possibly a breakdown of the past year’s units.

Hon. Ms. Hayden: I have no problem with that.

Mr. Phillips: I have a question in relation to the home repair program. The Member for Watson Lake talked a little bit about it.

I have received a couple of complaints about the program with respect to the bureaucracy, or the way the program is handled. Evidently, one individual started to repair their house and then discovered the program. Someone told the individual that Yukon Housing had a home repair program. The individual went to Yukon Housing. Everything seemed to be going along just fine until someone from Yukon Housing noted that the individual had started repairing the house prior to applying for the program. Therefore, Yukon Housing could no longer assist in funding for it.

If the purpose of the program is to create employment and to upgrade the houses - and this particular house was meeting all the requirements - why can there not be some accommodation for that?

Even though Yukon Housing advertises about the program, some individuals may continue to fix their houses by themselves, not realizing that the program is available. We do not always reach everybody in the newspapers or on the radio. This individual did not know the program existed until they ran into someone downtown who was fixing up their house and doing a similar thing.

What is the criteria for this program and how rigid is the criteria in order to qualify for program assistance?

Hon. Ms. Hayden: The short answer to the question is that we can only fund repairs that are required at the time of application. That is part of the program.

I will tell you what some of the requirements are. The purpose of the program is to assist homeowners in the repair of deficiencies - thermal deficiencies, accessibility for disabled people and other repairs that are necessary to bring a home up to minimum standards. The assistance is in the form of a low-interest loan, a portion of which may be forgiven. A maximum loan of $35,000 is available. The program standards are those standards approved by the contracting standing committee. You must be the registered owner of the home and a credit check on the applicants will be made to ensure their ability to afford a repair program loan.

The assistance is a one-time contribution, for the life of the dwelling, and the type and quality of work shall extend the life of the building an additional 15 years, at minimum. Only properties that are a minimum of five years old and older and that are your principal residence will qualify. The borrowers will be required to do all repairs necessary. The applications are priorized according to urgency and need. Work must not start until approval is received, so I guess that was the problem for the person with whom the Member discussed the program. All the work must be completed within one year of approval. Some of the structural things that we can do are: repair and replace failed framing, deteriorated roofing and siding, hand rails, guard rails, electrical, smoke detectors, chimneys, fire exits; in other words, it is to improve the safety of a building and the accessibility, which is very important, particularly with some of our seniors in the community. We will provide for modifications that will allow disabled people, who are capable of living independently, to remain at home.

That is the general criteria of the program.

Mr. Phillips: I thank the Minister for that information. I think the only criteria that this particular individual could not meet was that they had already started the work, prior to hearing about the program. I think they were putting on siding and they were also putting in some thermal windows. The house met all of the other criteria. I am sure that the individuals involved had the ability to repay the loan and in fact they were told by the individual from the Yukon Housing Corporation that there would be no problem whatsoever, until they went back to the office and discovered that some of the work had started prior to the authorization being given.

I wonder why that would be in there. Is there a certain reason? If an individual goes out and gets quotes and takes the lowest price and does all the things right that one would normally do for renovations, why would that not qualify? After all, the whole purpose of the program is to keep people employed and that is exactly what this individual did by upgrading the house. It made it more energy efficient, which is what we want to do, and it also helped employ some people for the time that they were upgrading the house.

Hon. Ms. Hayden: The intent of the program is to make it accessible to people. There is a certain amount of flexibility, although the intent is that any assessment be done prior to the work beginning.

I would ask the Member to privately give me the name of the person, and we can have a look at it. I usually say to people, do not take no for an answer, when they are asking for programs. Sometimes people ask for one program, and they are not aware that another one might be available to them, or that kind of thing. If the Member wishes to give me the name, we will have a look at it.

Mr. Phillips: I have no problem providing that to the Minister, but I think the individuals have already gone ahead with the work that they wanted to do to improve their house. I think they sought other financing to do it. I believe they went to a bank or some other financial institution to carry out the program. After they went through all the bureaucratic rigmarole you go through on these programs, they mentioned to me that they did not know whether or not they wanted to do it again. They spent so much time doing this, then found out later that they did not qualify, anyway. They did not know why they did not qualify, because they were doing exactly what the program wanted them to do by making their home more efficient and providing employment.

Hon. Ms. Hayden: Again, I would say that I would appreciate the Member giving me the name privately. Certainly, if they were part way through their renovations, even under the strict criteria of the program, they would have been eligible for whatever was remaining to be done. It may be that they can qualify in some way. On my feet, I cannot answer that. We would have a look at it.

Mr. Lang: There is very much of a housing shortage, specifically in Whitehorse, and it is also being felt by Dawson City and Watson Lake. Depending on what happens in Faro, I gather there could be a need there, also, depending on whether or not the mine proceeds with its stripping project.

There have been some programs put into effect and made available for the purpose of trying to promote the building of new apartments, primarily in the City of Whitehorse.

Has anyone, or any particular company, taken advantage of that particular program? How many apartments have been built?

Hon. Ms. Hayden: In answer to the Member’s question, some contractors have taken advantage of our programs, particularly the turn-key program. An example is the four units built in Granger. We are presently discussing programs for 1992-93 with five contractors. We are certainly seeking others as well. It is my hope that some of the programs will be taken up.

Mr. Lang: My concern is that there has been very little interest among the contractors for one reason or another. They do not seem to want to build apartment blocks for the government. The only apartment blocks of any significance that have been built was through direct financing by the government. An example is the Centennial units, which was not exactly a streamlined financial transaction. I notice the Minister of Economic Development nodding his head. I know why.

Also, we had the one in the Granger subdivision, which was built for the government. That is fulfilling a need, but there are also people who need an apartment. They do not necessarily need a government subsidy, but they need a place to live. The government seems to be content with the programs that are in place and tell those in the private sector to take it or leave it. There has to be some weaknesses in these programs, because very few people are taking the opportunity to provide living accommodation, namely apartments. What is the Minister going to do to revise the programs we have and put some incentives in place to get some apartment blocks built in the community?

We have a real problem in the community. Rents are going up and there are very few places for people to live.

Hon. Ms. Hayden: As a general comment, I would say that the weakness appears to be as much within the economy as within our subsidy program, or certainly within the housing economy. At present, the Corporation is reviewing the Whitehorse market; the results should be available in January and should give us a clear picture of the situation. As the Member, I am sure, understands, we have a fairly low rental in relation to the cost of putting up a unit. A unit that might cost $100,000 or $110,000 to build rents for $700 to $800 a month. So obviously we find contractors not willing to invest their money and that becomes a problem.

The incentives and changes we made in the joint-venture program were put in place for the small contractor or the home owner who wished to put a rental suite in their own home, thereby helping to pay not only the mortgage but also to provide additional housing. We have 70 enquiries at the present time in the Whitehorse area and many have been approved; we are simply awaiting the change in the zoning bylaw of the City of Whitehorse. I have not talked with the new city council about it yet, but will be talking with them. It certainly was indicated by the past council that they would be making that change, which would alleviate the rental situation for the people whom the Member is talking about.

Mr. Lang: I appreciate the effort on that side and I can say that our side unequivocally supports initiatives of this kind. The suites do provide some alternative accommodation, but they do not necessarily meet all of the needs of the community. It is not clear in my mind if these are legal suites.

Hon. Ms. Hayden: Yes, these are legal suites and there is also the capability for upgrading the present illegal or in-law suites that many houses have, in order to make them legal suites.

I would add that this situation is not typical only to Whitehorse. The lack of apartment construction is certainly a problem throughout the country. I wish that I could provide the Member with an answer, but I do not have one at the present time.

Mr. Lang: I think the lack of apartments being built in Whitehorse, or for that matter Dawson City - perhaps I could use Watson Lake as an example due to the economic situation there over the past couple of years - can be blamed on the fact that the territory has not had an infusion of dollars, vis-a-vis government, in the past number of years. There is no question about that.

From an economic point of view, one can argue if the dollars are being invested wisely, and that goes on day to day in this House.

For the number of people and the amount of money circulating, our economy is probably experiencing one of its more prosperous times, but I will agree with the Minister, our economy is weak and fragile.

I have talked with possible investors who have said that they are not prepared to invest in an apartment building in Whitehorse, because they are not certain of what the government is going to do. They do not know if the government is going to build apartments in competition with them, which has happened recently. For instance, the government built one apartment complex on Centennial Street and one apartment complex in the Granger subdivision. Subsequently, this puts the government in competition with the private sector, whether the government is renting suites in a private building or otherwise.

The Minister, in her answer, said that it is very difficult to find anyone to invest in a new apartment building. I think she implied that if you built a new apartment, it would have to be rented for $1,200 in order to get a return equal to the one you now own, which is renting for $800, in order to make a significant profit while still meeting the market rents.

It seems to me that one of the ways around this would be if the government would look at its programs from a tax point of view, or from the point of view where, if there are clientele whom the government is going to be providing accommodation for - in view of the fact that the welfare numbers have increased, then the pressure on the government is going to be that much greater - would it not be better, rather than the government building apartment blocks, as they have done, for the government to guarantee to rent a certain number of units from a private developer? Then, a developer may have another 10 or 15 units in that apartment block that could be made available to the general public.

Hon. Ms. Hayden: In relation to the housing economy, not the general economy, in relation to the Granger apartment building, it is not in conflict with contractors. This is subsidized housing. People are not going to be able to afford whatever rent might otherwise be.

Some of them have been built by the private sector, and the Centennial Street apartments is one example. The tax incentive the Member refers to was federal, which was recently removed by the federal government.

The main point I would respond to is that, since I have been Minister - and prior to that, I believe - we have been approaching local housing contractors with just the proposition the Member outlined, to guarantee renting a certain number of units within a complex. I hope, eventually, that will be taken up. However, to date, we have not had contractors accept that. That would seem to me to be a pretty good incentive for contractors, as the Member outlined. However, at the present time, they are not prepared to build under those conditions, it would seem.

Mr. Devries: I have one other question. During the past year I asked some questions about whether Yukon Housing Corporation was getting involved with the Jomini complex in Faro. I believe they were talking at that time to Hillsborough Resources. My understanding is that Yukon College has also talked to them about a possible joint venture. Is there any truth in this?

Hon. Ms. Hayden: First of all, the Jomini complex is owned by Government Services, not by Yukon Housing Corporation. There certainly was some discussion, previously, with Hillsborough about renovations. They backed out of it, as I understand. I am told that there would be no cost benefits for Yukon Housing Corporation to do renovations for housing units alone; it would be too costly.

Regarding Yukon College, I am sorry, but I do not know Yukon College’s plans but they do not involve Yukon Housing Corporation, as far as I know.

Mr. Devries: I have just one other question on the new program that has replaced the five-year, lease-purchase program. My understanding is that a person who is using that program has the option to go out to find an existing home that is for sale, or the option to have a new home built.

Does the Minister have any numbers on how many homes were purchased in this manner? For instance, how many used homes and how many new homes were purchased in this manner?

Hon. Ms. Hayden: I believe the Member is asking about the home ownership program. This program is offered to assist lower-middle income renters in buying or building a modest home.

I will have to get back to the Member to ensure that the numbers I am giving him are totally accurate. I believe there were 29 people in the program this year; 26 people purchased existing homes. That sould give you some picture of the program.

Mr. Devries: I guess you could say that, from these figures, it appears that it is a good way to purchase a home. However, it does not alleviate the housing problem. There is not going to be a new home built unless the person who is selling the existing home builds a new home with the money.

Hon. Ms. Hayden: We do have a turnkey program that would meet the needs the Member is referring to. In that program, we ask contractors to build homes that would come in somewhere between $90,000 and $110,000. Someone with a lower to middle income could afford this range. I referred to this program earlier with respect to the four homes that were built in Granger. This would seem to be the program that we are pursuing, and will need to pursue, in order to create more home ownership and more homes for people who do not have a very high income.

On Operation and Maintenance

On Gross Expenditures

Gross Expenditures in the amount of $233,000 agreed to

Operation and Maintenance in the amount of $233,000 agreed to

Yukon Housing Corporation agreed to

Chair:  We will go to schedule A.

On Schedule A

Schedule A agreed to

On Schedule B

Schedule B agreed to

On Clause 1

Clause 1 agreed to

On Clause 2

Clause 2 agreed to

On Title

Title agreed to

Hon. Mr. Penikett: Madam Chair, I move that you report Bill No. 18, Second Appropriation Act, 1991-92, out of Committee without amendment.

Motion agreed to

Chair: The Committee will now take a 15-minute break.


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

Bill No. 19, First Appropriation Act, 1992-93

Hon. Mr. Penikett: I will be brief in my remarks on the mains at this stage. I have already, in the budget address and in my replies to Members, covered most of the matters in some detail. I expect the House will be anxious to get into line-by-line debate.

Let me reiterate that these estimates request spending authority for the coming year in the amount of $418.7 million. In addition, authority is sought to loan monies to our municipalities and to repay loan principals on their behalf.

This budget reflects inflation, population growth and, as well, the service enhancements that we have provided for here. The estimated revenue inflow, as I have told Members previously, is approximately $400 million. The decision to draw down the surplus this year is deliberate in an effort to ensure that we can continue to avoid the recession that has plagued most other parts of Canada.

Members know now that recovery from that recession is likely to be slower and more halting than was originally estimated by forecasters just a few months ago, particularly the business press.

Eventually, we think this cannot help but have an impact on our economy. It is typical that national trends are delayed in regional resource-based economies. We want to avoid any wash effect on our economy, if we can. We have budgeted, as I said, on the basis of drawing down the surplus somewhat this year, because we want to keep Yukon workers working and Yukon businesses doing business, as we said in our opening speech.

I also need to say what we said before, that we have projected a budget surplus for the end of year, based on this budget. I would be less than honest if I did not say to the House that we fully expect that the surplus may be larger, and is likely to be larger, than the amount we have budgeted here. I gave the reason for that in earlier debate: we will likely lapse money in our votes, especially in the capital votes. As in all years in the past, most departments will lapse some money and in every year, there is some capital program that does not proceed on schedule. In general, our record of being able to spend what we vote is improving. With the notable exception of the 1989-90 fiscal year, the trend line is to reduce the proportion of the budget that is lapsed each year.

I would be the first to admit that we are a long way from perfection on that score, and, indeed, we may never achieve perfection. It would be pure luck to have a year in which exact estimates - for example, items like snow removal, or the estimates at the beginning of the year on the number of teachers needed in the school system the following year, or any number of estimates that are well-intentioned but have no guarantee of success - would be included in the budget. You would have to have a very stagnant and slow economy, almost a no-growth situation, a static community with almost no social mobility to be able to predict the budget with perfect accuracy in every area.

Members on the side opposite have commented upon this on occasion in the past, and the point is well taken. As I have said, we are trying to improve the resemblance between the budgets and the actuals as time proceeds. We are moving in the right direction.

The major spending initiatives outlined in this budget have been well publicized, and the appropriate Ministers will be speaking to them in some detail during departmental debate.

In the interest of time, unless Members wish otherwise, I will not go into them again, but I would like to give the Members a somewhat different view of the change between these main estimates and the 1991-92 main estimates. In this sense, I am responding to some of the public comment about the budget.

As all Members know, the 1991-92 budget did not contain any allowance for wage settlements we have since reached with our employees because, at the time, these matters were not concluded; they were being negotiated. As I have said in the past, it would have been folly to put projections of the amount we had anticipated the settlement to be, and contrary to all sound bargaining practices.

Had they been finalized, two years worth would have been included in those estimates. As a result, the mains-to-mains increase is superficially quite large.

If Members were to compare the two sets of main estimates, they would see an increase of about $61.8 million. I would like to break down that number a bit in a different way to try to illustrate something about the change from year to year. I want to try to explain this increase without going through the estimates on a line-by-line basis, as we did in earlier budget debate. In general terms, one way to look at it is as follows, and you have to keep in mind that what I am going to use now are only approximate numbers. They may, however, help Members to understand the changes in the budget from year to year.

Inflation alone, on the non-wage component of the 1991-92 main estimates would account for an increase of approximately $9.6 million, or almost $10 million. The three years of wage settlements in these mains would account for $23 million, as I said in my opening speech. If one assumes a linear relationship between population and expenditures, this factor would account for $13 million. This assumes that our population will grow in 1992-93 at the average rate of the past four years. I do not think that is an entirely unreasonable assumption.

The increase in capital expenditures, factoring out the three items that I just mentioned, adds another $2.7 million, or approximately $3 million, to the sum. The remainder of the difference, using this arithmetic, is about $13.5 million and is accounted for by new initiatives such as the child care enhancements or forced-growth items, such as the RCMP costs, beyond what can be accounted for by inflation, population growth, increased capital and wage supplements.

By breaking down the growth in the budget year by year, I put it into different terms than we did in the beginning - in other words, to describe it in terms of the impact of inflation, impact of wage settlements, impact of population growth, impacts of the conscious decision to add to the capital budget, the impact of the program enhancements and the impact of forced growth on items such as the RCMP costs, which are passed on to us automatically.

Let me conclude my opening remarks by saying that this side of the House believes this is a good budget, a responsible budget; it promotes the goals of our government: the economic conservation strategies, healthy communities and completing the land claim. I am certain these are goals that find support among most Members of this House and, indeed, the majority of citizens in our community.

I am prepared, of course, to answer questions of a general nature before we get into the departmental discussions.

Before I do that, I would like to respond now, if I could, to the questions during the supplementary put primarily by the Member for Porter Creek East, Mr. Lang. Some of the answers are quite short, but some are a little longer. I will read the answers; if the Member wishes me to table documents after that, I will do so, but not in every case do I have them typed out in a form that I can table.

The Opposition Leader asked, during debate on the supplementary, whether it is the position of the government - I was not sure which government he meant there, but let us assume he meant the responsible government in this case - that aboriginal people will have the right to hunt in national parks. I was also asked, at the same time, whether I could tell the House what size of area we are talking about for the new national park that will be created as a result of the settlement with the Vuntut Gwich’in.

First of all, let me say that federal government policy currently allows hunting by aboriginal people in national parks north of the 60th parallel, subject to conservation, health and public safety regulations. That is the federal policy. However, as I understand the policy, there may be some differences between parks.

In other words, some zones in Kluane National Park may be designated as no harvesting areas in order to protect park values such as use by visitors or some wildlife resource there. At the table, we have supported the retention of this harvesting right in the park, but we recognize the need to provide for other uses, such as hiking, walking and wildlife viewing, and that these may be incompatible with a hunting activity. The best way to achieve a balance of these kinds of use is through negotiations and agreements with the affected parties.

The Member asked about the size and location of the new national park in northern Yukon. As I understand it, the proposed national park is situated directly south of the existing North Yukon National Park and north of the R-1 block lands. The estimated size of this park is 1,800 square miles. I understand that the proposed name for the new park is the Vuntut National Park.

The Member also asked about the Nisutlin Delta national wildlife area. This area is being created to protect waterfowl and moose habitat, pursuant to the special management area chapter of the umbrella final agreement. The Member will recall asking me questions about the special management area provisions earlier in debate. I cannot recall if it was last year or 18 months ago, but I did, I think, describe the purposes of the special management area provisions then.

The final boundaries have yet to be determined, but the approximate size is 25 square miles, which is 12 square miles of land and 13 square miles of water area - we are talking about waterfowl protection here. This will be the national wildlife area and, therefore, governed by federal legislation. I gather any questions about harvesting in that area will be addressed in the management plan that will be developed for this park. As the Member knows, these management plans have to go out for public consultation prior to their establishment. By agreement, the management plan has to be finalized within two years of the agreement coming into effect.

The Member asked about the status of positions and employees moving to communities in year 1 of the decentralization program. I told him that of the 76 positions announced to date, 33 are in place in the target communities - 24 year 1 positions, and 9 of the year 2 positions. Of the 33 positions that are now in place, 26 are occupied by local community residents, four are occupied by individuals who relocated from Whitehorse, two are incumbent employees who relocated, and one was occupied by a local resident who recently resigned. A competition was held, with the result that a person from Whitehorse will relocate to the target community in the next few weeks.

I do not know if the Member wants a complete breakdown of that, department by department. If he does, perhaps it would be best if I provided that in written form rather than trying to read it all into the record.

The Member also asked about employees who had decided not to relocate, and whether the positions they subsequently accepted are additional positions. I understand that 13 employees were directly affected by year 1 decentralization plans and, of these 13, one was an incumbent employee already located in rural Yukon. This person’s hours were extended from half-time to full-time as a result of decentralization. One has relocated with his position. Of the 11 remaining employees, there are a number who are occupying the positions until they are relocated. A number have gone into other jobs. At least two have retired. Again, if the Member wants precise details on that I would have to provide him with a breakdown rather than try to report on my feet.

The Member also asked, in the supplementaries, what we were projecting the grant from Canada to be under the formula in 1993-94 and in 1994-95.

I have to caution the Member before I give him these numbers that they are very speculative, given the large number of variables that are now in the formula, and the large number of factors over which we have no control. The best estimate the departments can predict is that the grant from Canada in 1993-94 will be $241.9 million and, in 1994-95, it will be $253,121,000.

Again, I must add the caution that these are only estimates.

The Member also asked for a breakdown of the 25.3 percent of the 25 cents in the budget graph described on page 29 of the Budget Address, which is described as other revenues.

I will quickly read them into the record, but I have two copies of this information, and I will provide one for the Member.

Under the category of other revenues, we have $600,000 in public utilities income tax transfer; $353,000 from grants-in-lieu, $1,691,000 from property taxes, $595,000 from insurance premium tax, fees and licences from Motor Vehicles give us $2,447,000, game and campground fees give us $841,000, business and professional fees and licences give us $471,000; other fees give us $1,268,000, fines and penalties give us $307,000, SEAL loan payments give us $10,000, other sundry revenues are $32,000, O&M capital and recoveries - less CAP - gives us $92,319,000, for a total of $100,934,000. I will send a copy of this information to the Leader of the Official Opposition.

The Member also asked about the capital costs of decentralization. At this point, there is no indication that capital costs will be different from the 1991-92 main estimates. The situation in Carcross is not projected to result in extra capital costs, above those already voted. I think we talked in year 1 of the decentralization costs, which were $225,000 in one-time net capital costs.

Mr. Brewster asked how many of the positions at the airport and aviation branch are going to be new, with people hired from the Haines Junction area. The question was taken as notice, I think, by the Minister of Community and Transportation Services, who subsequently answered the question for the Member, on November 25, on page 1380 of Hansard. I think that answer told the Member that there were three new positions, plus the existing position of director of operations.

The candidate originates from Whitehorse and is relocating to Haines Junction in the new year. As I understand it, the remaining four positions will go to competition early in 1992.

The Leader of the Official Opposition asked for capital costs of the Haines Junction aviation and marine facility. I understand that the project is at the tender review stage. Firm construction costs should be known soon, but they will not be available until we receive the tender documents. On behalf of the Minister of Community and Transportation Services, I will take that question as notice.

A question was asked about the responsibilities of the special counsel position in the Executive Council Office. The special counsel for constitutional affairs has the following duties: one, to provide advice to the Premier and Cabinet on policy matters and strategy relating to Yukon’s involvement in national Constitution discussions, by supporting activities of the recently established Yukon task force if it needs to become operational; assessing federal constitutional proposals from those of the provinces in areas of significant interest to the territory; to track constitutional positions and activities at the national level; and, to help develop presentations for major constitutional hearings and processes, for example, the federal constitutional conferences that Mr. Clark has recently announced and the Royal Commission on Aboriginal Issues.

Secondly, to provide counsel on issues concerning Yukon’s internal constitutional development, including devolution by assessing devolution strategy and advising on strategic issues; advising on future constitutional development options for the Yukon, including amendments to the Yukon Act; supporting Yukon government involvement in First Ministers conferences, relevant legal cases and Ministerial conferences as appropriate.

Three, to liaise and coordinate efforts with Yukon policy and intergovernmental justice officials, with provincial, federal and aboriginal representatives.

I was asked for a breakdown of the constitutional personnel costs versus that of the secretarial. The current ranges for the two positions are $94,959 to $111,717 for the special counsel position, and for the secretary, the position is $31,075 up to $35,663 for a full-time equivalent position provided for in the supplementary as a three-quarter person year.

The Leader of the Official Opposition asked for information on the completion status of the medical services survey and the availability of results. I am advised that the project involves development of community health information, with $40,000 recoverable from National Health and Welfare. Administrative and service information is collected from all community nursing stations and rural hospitals, contributing to statistical accounting of the health of rural Yukoners. This will be used in the health status report called for by the Health Act to contribute to ongoing program planning and management.

The data collected covers the nature of the services provided, client demographics, community time allocation and other administrative information. I am sure that the Minister of Health will be more than happy to provide the Member with additional information.

The Leader of the Official Opposition asked me - it might have been during early estimates debate or Question Period, I am not sure - for the number of person years allocated to the corporations. I gave information based on some handwritten information from the Department of Finance that was not precisely accurate, and I would now like to give the Member the precise numbers.

I think I previously told him that the Workers Compensation Board had 28 person years; Yukon Development Corporation, eight person years; Yukon Housing Corporation, 30.5 person years; and Yukon Liquor Corporation, 44.3 person years. I am advised that the correct totals are: Workers Compensation Board, 28.5 person years - I will actually give the Member this information in writing, but I will give the correct totals as well - the Yukon Development Corporation is at eight, as I reported; Yukon Housing Corporation is 35.4, not 30.5; and Yukon Liquor Corporation is 47.3, not 44.3, as I previously indicated to the Member.

My deputy wants me to apologize on behalf of the officials in Finance, but I get blamed anyway, so I may just as well just say it is my fault.

I will have to check, but I think there may be one or two other questions to which I do not have the answers yet. If so, I will get the answers to the Members as soon as I can in debate.

Mr. Lang: I want to make some general observations. I find the document Revenue by Source, 1992-93, to be a very useful document, from a quick glance through it. I have not finished with it but would like to give it to the Clerk’s table so that perhaps we can get copies run off for all Members. Perhaps it could be given to the Page so that all Members can have an opportunity to review it.

An interesting element of this proves the case we have stated all the way along: that the government, in its position that they are becoming more self-sufficient, is basically playing a game of smoke and mirrors.

If one takes a look at the document that has been provided to the House, the federal transfers amount to $244,689,000. That is with the Canada Assistance Plan and the Established Program Financing. But I think it is important to talk about the O&M and capital recoveries, less the cap, which is where we have grown very dependent on the Government of Canada for transfers. This is not seen by the present government as a federal transfer; it is seen as recoveries. This is on the second page, and is very important if one takes a look at the Government of Canada and where these recoveries come from. I am just making the point, and I think this substantiates our point, that we are becoming more and more dependent on the Government of Canada as we go into these budgets.

My concern is not so much that the money is being spent; I want to assure the Minister that we are not taking the position that the money should not be allocated. It is a question of how it is being allocated and where it should be allocated. I have to say there are a number of areas in the budget with which we have no quarrel - for example, the area of education. I do not think anyone in this room, no matter what political stripe or political philosophy, is going to deny the provision of a teacher in a community if there is a need for one.

That is a question of costs and a question of providing it. One may argue the formula in how you arrive at what your personnel should be, but, unfortunately, when we get into that kind of an argument, what it seems to come down to is that you do not like teachers. It is not a question of whether or not the allocation is being fairly made and we are providing a good quality service within a formula. That, in part, is where the argument and tone of the debate is distorted and then carried - when they are here - by the media in a 10- or 15-second clip. Sometimes the importance of what we are discussing and the real fundamental policy decisions that are having to be made are lost in the course of debate.

Other areas of the budget that have come to our attention, and with which we have no quarrel, is the increased foster home rates. Those, to us, are social objectives that we have a responsibility to meet, and should meet. If we do not, it would be a loss to the whole community.

As far as the budget is concerned, the point I am trying to make is where and how the dollars are being allocated and whether or not we are getting a return on them. One that comes to mind is the one we debated earlier this afternoon: the Yukon Housing Corporation. We debated how we could provide programs that would encourage, primarily in our smaller communities, the ownership of private homes. I really think it is a tragedy that there are so few privately owned homes in the communities. A strong society cannot be built when the people do not own their own homes - whether native or non-native.

We have been given a window of opportunity with the financing we have received from the Government of Canada and I think we missed the boat with respect to devising programs like that. My heart goes out to those few individuals who have committed themselves to those smaller communities, built their own homes, and when they retire, find there is no market for their home because all the housing is government housing, and the only game in town is the government. They better cross their fingers that the government needs another house or they will never get back the money they invested in that home.

I would like to go back and talk about the recoveries for a minute and about the document that was given to us. It would have been nice to have had it earlier but I appreciate the work that was done on it. I notice that the recoveries are up substantially, even from the previous year. I do know there are millions of dollars that the Minister of Health and Social Services indicated to us were made available by the fact that they had new people in the Department of Finance to negotiate with the Government of Canada to obtain recoveries. I gather that has substantially increased the recoveries. Nevertheless, I do not think one can diminish the reality that it is federal dollars that we need and if the federal government changes those programs, we are going to be in a situation where we are going to have less money.

One area of decrease that just became public is dental therapy. Dollars for that program are being cut back by the federal government. Therefore, we are in a situation where we will not be able to recover those dollars.

The reality of the situation is, whether it is a direct transfer to this government, comes through the financial agreement, or comes through the recoveries from the Government of Canada, we still are dependent on Ottawa and we are becoming more and more dependent. We should not kid ourselves. I think we should be very much aware of it.

I think that we could criticize the budgets that have come before. There has been very little thought in them regarding the future and the possibility that the federal government might decide to change the rules for the financing of this government. We are in the process of building a government that is very large, as a proportion of the work force in our community. If, down the road, any of these recoveries are cut back or if our transfer payments are cut back, or if they do not keep up with inflation, we are going to be hard pressed to meet our bills.

I realize the Minister is going to stand up and say that the official opposition is preaching doom and gloom but I am talking about four or five years down the road. I am saying to the Members in the House that we have a responsibility, as elected leaders of our community, to look at the future of the territory and where we are going to be five years down the road.

I am saying that, in part, we are not doing that. I use the example of Yukon Housing. That is a philosophical question. The dollars we are talking about would still be spent, but it is a question of how they would be directed.

There are also some basic issues facing the territory. We have not been able to come to grips with the very significant, long-term energy policy decisions that have to be made. It is no laughing matter that we raise the issue of the Yukon Development Corporation and the Yukon Energy Corporation on a day-to-day basis in this House. It is because of the significance it is going to have in the territory five years from now, even if a decision was made regarding Surprise Lake. It was a surprise to the side opposite, too, so it was well named. It came into the forefront here about six months ago. Even if we were to start tomorrow, we would be looking at a five-year lead time by the time  the environmental processes, et cetera, were started.

Our concern is from the point of view of how we are putting what excess dollars we have into the economy, over and above our social responsibilities. I notice the community development fund seems to be getting larger every year. We do know that, in part, it is to meet the political objectives of the government as they sit around the round table and hand out the money to those who best meet the criteria.

At the same time, dollars should be going into areas of significant interest to the general economy. I previously talked about flow-through shares and the fact that the government should be doing everything it can to prevent the uncertainty caused in the climate here in the Yukon, partly by the federal government and partly by the territorial government because of the various pieces of legislation coming in and how they will affect future investment.

There are a number of areas where we, on this side, feel that money could be better invested for the public we serve.

I am not specifically going to get into the land claim or the question of the national wildlife refuge. I will get those in the line by line. It would be better, because we could concentrate on one area.

I have a question for the Minister on the actual agreement we have with Canada. He quoted figures for next year, and I will not hold him accountable, except to a degree.

The fact that the department has projected $240 million through the financial agreement, and in the subsequent year, $253 million; that leads us into 1994. Do we have any projections for 1995 as far as projecting that far ahead with respect to the financial agreement?

Hon. Mr. Penikett: Forgive me. That was probably the longest ramble to a very short question that I have ever heard in my life. I do feel obliged to respond to the preamble before I get to the question. I will eventually get to the questions, since there is no time limit on me today.

First of all, I want to say to the Member opposite that I disagree completely with his fundamental critique of the budget in the sense of whether we are taking care of the future.

I want to ask the Member to cast his mind back to those dark days when he was in office, and to the level of the budget in those days, and the increase that we had as a result of formula financing. This government made a conscious decision to put as much as possible into capital, rather than programs. The Member has criticized this on occasion, and on other occasions he has argued that we should have spent more capital on different things. Perhaps even he would concede that he has not been perfectly consistent on this score, but the point is we have shown in this budget that we spend a larger proportion of our budget on capital than any other jurisdiction in Canada. We do not spend slightly more; we spend way more. In fact, I think in the most recent budget, it is about twice as much as our sister territory, the Northwest Territories. They have got themselves, if I may use this expression, “hooked” on more programs than we have.

Let us say that we had the calamitous situation suggested by the Member - and I think that even he would suggest that it is an extreme doomsday scenario, not likely to happen, but let us just say it did - that the Reform Party got in. I understand that Senator Waters, when he was in Yellowknife, did say that the formula should be radically cut North of 60. Let us say this happened and that we went back to levels of funding as they were in the old days. Let us say that, as a result of that, the government of the day - and I am assuming whoever it would be - had to take the capital budget down to the same kind of proportions that it used to be.

That would represent the amount, in very approximate terms. The increased money we received enabled us to increase the capital spending by a similar amount.

I do not want to get into a long complicated argument about this, but I would argue, from my point of view, that at that stage, four or five years from now, projecting into the future, we would be in a relatively good state to handle even that calamitous scenario because a large number of our schools, infrastructure, roads and plants that had been in poor shape - everybody admits that, because we have not had sufficient capital over the years - would have been replenished and in good operating order.

It is true that when new schools are built, even if they are relatively efficient, it adds operating costs. It is also true that, if one paves roads for example - roads that were previously gravel or dirt - operating costs can actually be reduced that way. If the road system and school system, and so forth, is in relatively good shape on that date, in theory the capital budget should be able to be reduced back down to the levels it used to be when the Member opposite was in government and still have sufficient money, under our radically constrained formula, to be able to operate the programs that are now in place.

I am not making any judgments about future governments. A future government may be a Conservative government; it might come in and want to cut all sorts of programs. They did not do that when they were in office previously. In fact, the program expenditures increased at a faster rate when they were in office than they did when we were in office, in percentage terms, but that future government might do that.

I still believe that we will have been in better shape in that projected future by virtue of having put as much money as we have, by conscious decision, into capital these last few years and even if, in fact, we were able to continue to do it for another four or five years.

I will not go off into the diversion about the Development Corporation because the Member opposite, and in fact, many Members opposite, might have had the opportunity of discussing that before and I am sure the Minister responsible is looking forward with delight to the prospect of discussing that tomorrow or whenever we will be discussing it further.

Let me go back, though - way back - to the beginning of the Member’s remarks. He talked about his response to the document I have now tabled, called Revenues by Source, 1992-93.

I would like to point out to him that I think that it is wrong to suggest that we are somehow being artful or inaccurate by presenting the information as we have in that document. Let me explain one thing first. The charts on page 29 in the budget book are broken down according to Stats Canada categories. We have to break it down that way if we want to have comparative data with other jurisdictions or even to compare with the national norms. The Member must also remember that established program financing and capital assistance program monies do not just go to the territories. I think the Member knows that they go to every single jurisdiction in Canada. It is part of our national entitlement. This is not something special for us; we do not get any special arrangements through EPF and CAP. They are programs that are tied to very specific expenditures. The established programming financing is for extended health care and post-secondary education; CAP is for very specific programs in which there are matching funds.

The Member will know, when he is making the argument about federal dependency, that the federal government has cut both of these programs. Even for us, I think the EPF, shown on Page 4 of the estimates book, shows that there is something like a 12 percent cut between the 1992-93 mains and the 1991-92 forecast.

If you take a look at the transfer payment from Canada that the Member makes mention of, the budget book shows it increasing at the rate of $4 million. The fact of the matter is that inflation alone - forget population, forget a growing economy - would have seen the grant go up about $9 million for the budget that we are talking about. In real dollar terms, there has been a cut. Even if we take into account the recoveries - and I appreciate the case the Member is trying to make about recoveries - there is a reduction, a small reduction, from the years 1985-86 to the years 1992-93, in percentage terms.

Let me talk about the recoveries for a minute, because the Member has mentioned the large increase. I did speak about this previously in one of my two speeches in the budget - I forget which one. I pointed out that the estimates book, on page 10 and 11, shows the departmental detail of the increases in the recoveries for both the operating budget and the capital. In the O&M budget, the biggest increases are in Community and Transportation Services, where increased expenditures and recoveries on the Alaska Highway are the significant factor, and in Health and Social Services, where native social and health services account for the bulk of the difference.

In capital, there is, as I recall, a large increase as a result of the recoveries we are budgeting for the new hospital. There is also a smaller increase in Community and Transportation Services relating to air strips and land development. Recoveries for something like the hospital is not something we can bank on year after year. This will, no doubt, go on through the construction phase, but once the transfer is complete and the new hospital is built, it will no longer be there.

I hope I have not taken as long as the Member, but I will come now to his precise question; 1994-95 is the last year of the current five year formula. That is the year beginning April 1, 1994, and ending March 31, 1995. That number was given to the Member already. It is $253,121,000.

We could do calculations and project the same formula into the next period but, as the Member knows, it would be a pointless exercise. We did that with the old formula, and we got a new formula. The one thing I am determined to try and do with what remains of this formula is to deal with one specific item: the perversity element.

When the federal government is cutting everywhere, we understand perfectly well we cannot escape that reality. In proportional terms, up to now, we think we have been cut more than most of the provinces, although it appears that the cutting of the provinces is not over yet. They have just had some recent cuts that particularly affect the so-called “have” provinces in very serious ways. The federal government has been challenged on that.

Even if we had the same kind of reductions in the formula, in some different way, it is imperative that we go into the next bargaining session with the federal government seeking to deal with this critique the federal government has of us that we do not charge enough taxes; we are not paying enough taxes, and we should be raising our tax rates.

In their view, we are not demonstrating sufficient tax effort. Indeed, they believe we should raise taxes, and we believe, and have studies to show it, that our tax burden, because of the higher cost of living, is just as great here as it is anywhere in Canada, in terms of disposable income.

The problem the federal government has is they show a list of all the taxes available in all the different provinces in Canada. On there, we are listed as having zero taxes. For example, there are taxes on corporations employing 1,000 or more people, but we have no corporations like that. So, we show the tax rate as zero; the average in Canada is higher than that, and we get penalized because we have no tax in that area.

We are penalized because we do not have a retail sales tax, which the federal government would like us to have and, then, to harmonize it with the GST, which they are trying to get provinces to do. We fundamentally disagree on that point.

As I have told Members before, all I could get from Mr. Wilson before he left office was an agreement that he would have another look at the matter. We have since been invited to make some alternate proposals about how this would be done.

We will no doubt be getting into serious discussions on those well in advance of the next formula negotiations.

Mr. Lang: As we know, things change. Mr. Wilson is no longer there, so I would assume that the rules have changed, in one manner or another - good, bad or indifferent. Obviously, more changes will take place.

My concern regarding the financial formula and where we are going is that, when I look at the amount of dollars for the coming two years, I see that our capital budget is going to have to be correspondingly less, depending on inflation. One can predict what inflation is going to be, but assuming that it is even five percent - just for the sake of argument - you are looking at $20 million on a $400 million budget if nothing else happens, and if you are going to carry on with existing programs. At the same time, we have an increase of only $10 million.

That is just a scenario, but it illustrates a gap that will have to be picked up somewhere. It would have to be taken out of what would have been allocated toward capital.

I can see what is happening, and the Minister is quite correct. We do have a high proportion right now on the capital side but slowly, over the next three or four or five years, it is going to switch quite dramatically in respect to fulfilling the operation and maintenance requirements of the government versus those of capital.

I accept the Minister’s argument that perhaps, even with the financial formula and the significant cutback to the government, the government could probably maintain its services. Our concern, however, is that with the amount of dollars that we have, cutting back on the capital side is going to have an adverse effect on those who are in small business, and private sector employers and employees. Whether we like it or not, in the economy that we have in this territory, very few companies, if any, are not dependent on government contracts, in one manner or another, to form part of the basis of their business.

Obviously, the end result would be that they would be the first to be adversely hit, if the worst-case scenario, as we discussed it, were to happen. I want to register that as our concern. The Minister indicated to us that the employees of the corporations, Workers Compensation Board and the other ones he mentioned were not accounted for in the budget; can the Minister tell us if there has been any increases in personnel within those particular corporations? The Government Leader provided us with numbers, but I do not know what to compare them with.

Hon. Mr. Penikett: Having made a mistake with the numbers once, I hesitate to lift up my head and answer the question; however, I will take that as notice. I would like to make the point in response to the Member’s speculation about a Doomsday scenario.

I do not think that the kind of questions that he is talking about in the capital budget necessarily follow. Let me make this point: last year, the capital budget was 26 percent of the total budget, but this year it is 28 percent. Even if we came down 16 percent to the level of the next largest jurisdiction, which is the Northwest Territories, we would still be larger than any province, the largest of which is 12 percent and the average, which is around seven to eight percent. I have not actually run the numbers for what percentages for 1983-84, 1982-83, 1981-80, of what is in the total budget; however, I might do that exercise. I am pretty sure that we are spending a larger proportion of our budget now than we were back then. Let me make the point that I suspect that the percentage of the territory’s budget spent on capital was quite a bit larger than most of the provinces.

To summarize my point: one, I do not think that the Doomsday scenario is going to happen; I admit that there could be further cuts, but I do not believe that the Doomsday scenario is going to happen; and two, for reasons that I have previously given, I do not believe that the Doomsday scenario will play out quite in the way the Member suggests.

Mr. Phelps:  One has to be very careful about comparing numbers. A lot of the financing at that time was done in agreement on a project-by-project basis and cost-shared with the Government of Canada. It was not the discretionary dollars that this financial formula has granted to the Government of the Yukon. The Minister might admit that, although he was not part of the government at that time, it was much more difficult to get discretionary financing and really put the dollars where the government wanted. I can recall going to Ottawa to negotiate project-by-project and having to justify each one. I would warn the Minister that, if he is going to have someone do these numbers, he should realize that he may be comparing apples and oranges because of the financial arrangements that were in place in the late 1970s and early 1980s.

Hon. Mr. Penikett: The Member is perfectly correct. That used to be the way it was when I was a municipal councillor in relation to the Government of the Yukon. I think we should both be happy that it changed for the municipalities, as well as for the territory.

Mr. Phelps: I would like to put something on the record about an interesting debate I had with the former Minister of Finance one year ago. I am doing this partly because that debate was raised by the present Minister in his speech during second reading. It had to do with the amount of money that is raised by this government and the amount of money that is transferred to us, whether as recoveries, transfer payments under the formula financing agreement or by established program financing, which the Auditor General refers to as transfer payment in the public accounts. Formally, they are considered to be transfers, according to his description.

The current Minister may recall that I tabled a graph that showed last year’s mains - with the same information as is on page 4 by category - with the territorial revenue as a percentage of the other three - the EPF transfer payments and recoveries - over a period of time. The reason this became an issue is because I took some umbrage with the graph the government continues to put out in the appendix of the budget address. On page 30, it shows these federal transfer payments as percentages of budgetary income, dropping from roughly 61 percent to 55 percent.

When I tabled my graph, the then Minister of Finance took it under review and had some difficulties - rather modest difficulties, in my view, but nonetheless some difficulties - and he, on November 27, 1990, tabled a response. This is found at page 393. I propose to table a graph we have made up from the document that was tabled by the then Minister of Finance. Perhaps I could ask that this document be tabled and delivered directly to the Minister.

This graph is a fairly simplistic way of doing things, as is the graph that forms the appendix of the budget address. The graph relates the column “Territorial Revenue and Recoveries” year by year as a percentage of the adjusted revenue inflow. The point, very simply put, is that, in all these years, the change is rather minuscule. The old mains figures from last year, 1991-92, show that 77.7 percent was from federal government and 22.3 percent was raised locally. It is interesting that things really have not changed very much.

I have just had a chance to have a look at the document formally tabled today, Revenues by Source, 1992-93.

I gather the established program financing is calculated into the figures there. We have not used the actual situation with regard to this; we have just used the arguments put by the previous Minister, merely to show that, relatively, things have not changed much - one percent, or whatever. I felt compelled to do this because I felt a duty to respond to the comments made by the Minister when he closed debate on second reading.

I hope that puts it into perspective. There is no intention of trying to play with the figures. It would not have made much difference, but I suppose I could have used the figures over in the box. I had not really addressed my mind to that one at the time I asked for the figures to be put together.

I think this fairly represents what the response of the Minister was.

Hon. Mr. Penikett: I want to say to the Member for Hootalinqua that we will match his graph, and raise him one.

I do agree that it is a simplistic representation of the figures. In some way, I think we covered some of this ground with his colleague from Porter Creek East.

The Member will understand that I cannot up the ante, or the stakes, this instantly. I will have to wait until at least tomorrow to respond and cover his wager. I am willing to bet that we can present just as pretty a picture as he has done. I suspect that he is not using real-dollar terms here.

Let me come back though. It is interesting that the Member still conceives in the information that he has provided to us - in the small print in the far right hand of the column in his document - that the percentages of dollars from the federal government have gone down from 1985-86 from 78.6 percent to 77.5 percent. This is not, as I conceded earlier in response to the Member for Porter Creek East, a huge reduction. I did, in fact, spend some time earlier. I do not know if the Member was able to hear everything that I said explaining some of the variations in the numbers.

The Member for Hootalinqua fascinates me in that he has of late, in a way that he never was before, become a bit of an encyclopediast - a reader of Hansard. I do not know if he is doing that or whether he has some kind of a researcher who has this peculiar, purely bad habit of wanting to go back over the old tomes. With respect to his observations about locally generated revenue, I find some resonance and some harmonic echo of the federal position, suggesting perhaps that we ought to be reducing our dependency at a faster rate by increasing locally generated taxes. I would be disappointed to hear that this was the view of the former Leader of the Official Opposition since he had so adroitly recently divorced himself from the federal Conservatives on this position.

I would like to know from the Member, for the sake of clarity, and in order to permit us to more perfectly respond with the right graphs, if it is his position that we should be increasing local tax rates, in order to wean ourselves from the federal treasury at a faster rate - to, as Shakespeare would have it, “untimely rip us from our mother’s womb”.

Mr. Phelps: There were a large number of points made by the Minister just then. Firstly, with regard to his seeing my ante and raising it, I do hope that there is some kind of House limit or at least that we are playing table stakes, so that eventually it comes to an end. I would point out that in the material that I have presented, the figures I am using are their figures, not mine. That was the whole reason behind the exercise. I like to use their figures.

With respect to doing the research, there is nothing I enjoy doing more than spending my evenings at Carcross ploughing through old copies of Hansard, so that I can set the record straight from time to time.

With respect to our position on raising taxes, our hope has always been that the growth of government, relative to the growth of the private sector, would have been drastically different and that there would have been more taxes raised locally as a result, and that the expenditures necessary to carry on the business of government would have been reduced from what they are now, and that the operation and maintenance that we see now, and some of the capital projects would not have been necessary. One example that rapidly comes to mind is that it seems to me that there are better ways to get quality housing for people than through the instrument of Yukon Housing Corporation. I would like to see less spent there and alternative situations or policies invoked. I would like to see, wherever possible, more done by the private sector.

To put it as simplistically as I can, I would not be in favour of raising taxes just for the sake of raising taxes, and I would be opposed to the federal government’s position, as is the Minister. The real issue has to do with whether or not we are going to be able, at some point in time, to reduce our dependency on Ottawa.

That is what the issue is about, and that issue flows into the issue of economic diversification. We have been through this dance before and I doubt the Minister wants to hear me speak on it for the next 15 minutes. I do not think I have anything new to add to enlighten him, with, but in case he was not listening before I could certainly proceed to do it.

We simply feel that government is too big in the Yukon, relative to the private sector. That is our view and I know we will have disagreements with the side opposite for ever and a day on that issue.

Hon. Mr. Penikett: First of all, I will express one caution for the Member opposite. He has presented the chart to us called “Comparative Chart of Federal Money and Territorial Revenues”, and there is text below, which says “Using NDP figures”. Lest the Members cause palpitations among the good officials in the Department of Finance - most of whom would strenuously deny being now, or ever having been, card-carrying members of the New Democratic Party - I am sure he would want to withdraw the assertion that somehow these numbers were adopted in a resolution at an NDP convention, rather than their being the whole truth, nothing but the truth from the officials of the Department of Finance.

Let me say one thing about an area where of course we agree - that may be one of those remarkably few areas where it is the case where both sides of the House agree: that we have a long-term interest in reducing our dependency on the federal government.

I take it that the former Leader of the Opposition’s representation is that we ought to be reducing our dependency on the federal government at a faster rate. We believe that we are reducing the dependency relationship and that, over time, we are moving in the right direction, but I would suggest that my view is that a rapid or violent weaning, which has been suggested in the Member for Porter Creek East’s doomday scenario, is not something that I would advocate or support.

The Member for Hootalinqua said that he had nothing to add to the speeches he has previously made about diversification. I would agree with that but I would also agree that I do not have an awful lot to add. I have tried to communicate as well as I can on that score and I have yet to persuade the Member for Hootalinqua. Since he argues that the public sector is too big in the Yukon - and the private sector is, therefore, I guess, too small - I would ask him, if I were permitted to, Madam Chair, if he believed that the public sector was too big back in, say, 1984, and if he did believe that the public sector was too big back in 1984, how could he have trumpeted, as he did, the advent of formula financing?

In 1984, formula financing was something that, under any scenario that I can imagine, was bound to make the public sector relatively larger, unless of course the money were simply given away to the private sector almost immediately. I do not think this is the purpose for which it was intended.

Mr. Phelps: A number of points were again raised by the good Minister. He asserts that both sides agree that we want to see the Yukon become less dependent on the federal transfer payments and that he feels, hopes and believes that we will be.

Where we differ is on the present course that we are taking, because we do not believe that is the case. Unfortunately, the problem that we face is the problem faced by the agnostic. Unfortunately, you have to die to find out which side is right.

The Minister also stated - I am glad that he clarified this - that this was not prepared by the NDP, but was prepared by officials in Finance. I am glad that has been clarified, and I readily acknowledge the Minister’s observation that most of the officials in the department would be horrified to be tarred with the NDP brush. They have better sense than that, so we agree on that.

He asks, in essence, how our course would have been different from the course chartered by this government had we been in power after we had signed the formula financing agreement. Of course, that could be the subject matter of a rather lengthy speech.

We have made it clear that we would put more emphasis on certain things rather than on government, so our approach to housing would have been quite different. We would not have seen the growth in Yukon housing. We would have tried various programs to encourage the private sector including, where necessary, leasing on long term leases from apartment blocks built by the private sector, and that sort of thing.

We spoke about a much higher priority with regard to developing the energy infrastructure generally. We have had our differences about the Yukon Energy Corporation. I do not think I have to reiterate all of that.

We said we would have taken a different approach to the forest industry. We have adjourned debate on that one. I could not possibly cover even the relevant points in the few minutes we have left this afternoon.

The kind of capital projects would have varied somewhat. They are not night and day apart, but I think there would have been more of a tendency to try to get money into infrastructure that would facilitate industry as a higher priority, as opposed to money into infrastructure for sports, recreation, community clubs and that sort of thing.

This is not necessarily a drastic change. I have spoken several times about my concern about all the stand-alone complexes we are developing, even in Whitehorse, when it seems to me a lot of these facilities should have been under one roof and be sharing some of the infrastructure. For example, down south, buildings like the B.C. Stadium, the Maple Leaf Gardens in Toronto or the Forum in Montreal are used by all kinds of different groups, so they do not duplicate the infrastructure every time. I am frankly concerned that we seem to have so many stand-alone facilities when we could have had facilities, in Whitehorse particularly, that might have shared some of the common structures.

Right now, in the absence of a large convention centre, when we have fairly large conventions in town - such as the Northern Resources conference or the one that was going on last week for the mining fraternity - they have leased existing facilities, such as the Twin Theatres, to hold lectures in and so on. I am concerned about each individual group coming forward and wanting to duplicate services they could share.

I guess I feel that we probably could have built one building instead of building a convention centre, an arts centre and the proposed downtown community centre. We could have shared some of the main features without duplicating.

Hon. Mr. Penikett: If I may be permitted to combine both themes of this debate - the gaming theme and the religious theme - let me say that while the Member opposite finds himself an agnostic on this question, I count myself a true believer. I am a great fan of the French philosopher who offered the famous Pascal’s gamble that argued that it was better to bet that God did exist and be proved wrong that to put your money on the other alternative and to be proved wrong.

I have looked forward to the opportunity of debating the wisdom of the unified recreation complex with my colleagues, which was an idea that was defeated by the local rate payers in Whitehorse. It may be that the Member opposite is making proposals similar to those advanced by the learned municipal mayoralty candidate, Mr. Armstrong, on central complexes. I look forward to hearing about that tomorrow.

Madam Chair, I move that you report progress on Bill No. 17.

Motion agreed to

Hon. Mr. Webster: 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 the report from the Chair of Committee of the Whole?

Ms. Kassi: The Committee of the Whole has considered Bill No. 18, entitled Second Appropriate Act, 1991-92, and directed me to report same without amendment.

Further, the Committee of the Whole has considered Bill No. 19, First Appropriation Act, 1992-93, and directed me to report progress on same.

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

Some Hon. Members: Agreed.

Speaker: I declare the report carried.

Hon. Mr. Webster: 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 5:29 p.m.

The following Sessional Paper was tabled December 3, 1991:


Training initiative regarding correctional officers and community volunteers (McDonald)

The following Filed Document was tabled December 3, 1991:


Comparative graph of federal money and territorial revenues, 1985-86 to 1991-92 (Phelps)