Whitehorse, Yukon

Monday, March 22, 1993 - 1:30 p.m.

Speaker: I will now call the House to order. We will begin with Prayers.

Prayers

DAILY ROUTINE

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

Introduction of Visitors.

Are there any Returns or Documents for tabling?

Are there any Reports of Committees?

Petitions?

Introduction of Bills?

Notices of Motion for the Production of Papers?

Notices of Motion?

NOTICES OF MOTION

Mr. Millar: I give notice of motion

THAT this House urges the Implementation Review Committee to recommend realistic placer mining regulations that will promote the development and growth of the placer mining industry while protecting the Yukon’s fishery resource.

Hon. Mr. Phelps: I give notice of the following motion:

THAT this House applauds the Government of the Yukon for signalling its intention to restrict the mandate of the Yukon Development Corporation to ensure that Yukon Energy Corporation profits and Yukon Development Corporation profits are directed at reducing energy rates, developing energy infrastructure and promoting energy conservation and that these corporations will be dealt with in an arm’s-length fashion.

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

THAT it is the opinion of this House that the Government of Yukon should support the development of a portable sawmill for the Vuntut Gwich’in riding.

Hon. Mr. Devries: I give notice of the following motion:

THAT it is the opinion of this House that the Government of Yukon should support the development of the Windy Craggy project and the mineral potential of the Alexander Terrane not encompassed by the national parks on the understanding that this area can be developed in an environmentally sound manner.

Mr. Millar: I would like to give notice of the following motion:

THAT it is the opinion of this House that the Top of the World Highway should be upgraded and

THAT the Government of Yukon consider upgrading the existing ferry service and should investigate the feasibility of building a bridge across the Yukon River at Dawson City in order to promote tourism and economic development in the region.

I would also like to give notice of the following motion:

THAT this House urges the Alaska State Government to fast-track its portion of construction and road improvements on the U.S. side of the Top of the World Highway in order to better accommodate the tourism industry for both the Yukon and Alaska.

Speaker: Statements by Ministers.

This then brings us to Question Period.

QUESTION PERIOD

Question re: Conflict of interest, Minister responsible for YEC

Mr. Penikett: My question is directed to the Minister responsible for the Yukon Development Corporation and the Yukon Energy Corporation, who will be giving his sawmill speech for the eighteenth and nineteenth time, no doubt, on Wednesday.

My question arises from the recent conflict-of-interest issue involving the Minister and his ownership of shares in a company competing with the Yukon Energy Corporation.

I would like to ask the Minister if he can give his assurance that the assets of the Yukon Energy Corporation will not be offered for sale either to Canadian Utilities, Alberta Power or the old family firm, Yukon Electrical Company.

Hon. Mr. Phelps: I can assure the hon. Member that there were no dealings with the Yukon Electrical Company Ltd., Alberta Power or Canadian Utilities during the time that I was Minister and had 200 shares of Canadian Utilities.

With respect to the issue of whether or not in the future there might be some asset rationalization between the corporations - that is to say, in particular between Yukon Energy Corporation and YECL - there is nothing planned at this time.

I am aware, from briefings, that there is an issue and has been an outstanding issue since Northern Canada Power Commission was taken over by Yukon Energy Corporation; it has to do with rationalizing the wholesale and the retail businesses.

Speaker: Order please. I would ask the Minister to conclude his answer.

Hon. Mr. Phelps: I can tell the House that this issue has not been addressed at all, yet. I am aware that it is an outstanding issue and it may be something that this government may look at in the future.

Mr. Penikett: As the Minister knows, for decades people of all political persuasions have fought to bring Northern Canada Power Commission under local and public control. Given the confusion created last week about the government’s intention with respect to the Yukon Development Corporation and the use of the words “eradication” and “restructuring” - and now a new one, “rationalization” - I would like to ask the Minister this precise question: can the Minister give the House assurance that the hydro assets of Yukon Energy Corporation will remain in the public sector and will not be privatized to any of the private companies mentioned in my first question or, for that matter, to anyone else?

Hon. Mr. Phelps: I take from the Member’s question that he is speaking about the manufacturing of electricity - those kinds of assets - and I can give him that assurance.

Mr. Penikett: I hope that assurance will not be corrected tomorrow when we are talking about rationalization or restructuring. I would like to ask the Minister one final question on this subject. It is a question to which I have given notice, and which he may wish to take as notice himself. Since the Minister has conceded that he may have been in a position of potential conflict of interest for some time now, will he provide this House with a list of all Yukon Development Corporation and Yukon Energy Corporation decisions in which he was involved in this period?

Hon. Mr. Phelps: I certainly will be prepared to do that. I suspect there is some confusion on that side. Today, he talked about us speaking about the eradication of the Yukon Energy Corporation and, earlier in Question Period, he talked about the disposal, or elimination. “Elimination” was the word used. It was used in a sense that was correct under the circumstances: the Yukon Development Corporation was to be eliminated as we presently know it. That position was clear from comments made earlier by this Minister. I just want to ensure that the side opposite takes the care that this side does when it is attempting to communicate its understanding, hazy though it may be, of government policy.

Question re: Economic strategy

Mr. Penikett: I thank the Member who just spoke for restructuring his leader’s answer of last week.

I would like to direct a question to the Minister of Economic Development about Yukon’s economic strategy. In December, the government released its document, Toward Self-Sufficiency by the 21st Century. Can the Minister tell the House whether this document has now replaced the Yukon Economic Strategy as Yukon government economic policy?

Hon. Mr. Devries: I would not go so far as to say it is replacing it, but we are looking at the Yukon Economic Strategy to review it. After that, some changes may be made to it. I could not comment any further on that at this point.

Mr. Penikett: I thank the Minister for his answer, I think.

The Yukon Economic Strategy represented a consensus developed over a two-year period with thousands of Yukoners participating in the question about our future economic direction. As the Member knows, it came to the House in the form of a resolution and, subsequently, passed into law by way of the Economic Development Act. All parties voted for it.

Can the Minister state who was consulted by the new government when they decided to develop their own strategy to supersede the Yukon Economic Strategy, and can he tell us when the government made the decision to review and indicate with whom they are going to consult as they do the review, since he has previously conceded that the government strategy was only the product of consultation with one party: the Yukon Party?

Hon. Mr. Devries: First, I would like to say that I never said that only one group was consulted; there were many groups.

Any review of the economic strategy is not very preliminary. The 21st century self-sufficiency strategy fits very well into the parameters of this strategy. There may be a few changes that have to be made, but they will be very few. There will be consultations with the public on anything that is changed.

Mr. Penikett: The Yukon Economic Strategy commits this government and the territory to a goal of sustainable development. The self-sufficiency strategy of the Yukon Party contains 31 major potential projects, 25 of which are not renewable and probably cannot be described as sustainable.

Can I ask the Minister if this government is still committed to a strategy of sustainable development?

Hon. Mr. Devries: This government is indeed committed to a strategy of sustainable development.

Question re: Access to information

Mr. Cable: I have a question for the Minister of Justice relating to access to information. Last year, the Minister, when in Opposition, tabled a motion in this House setting out that the present Access to Information Act was inadequate and should be amended. Subsequently, the House dealt with the Public Government Act, which substantially amended the Access to Information Act legislation. Did that portion of the Public Government Act, relating to access to information, deal with what the Minister then thought were the inadequacies with the present legislation?

Hon. Mr. Phelps: Certainly, this Member was rather incensed with the way in which the current Access to Information Act was being implemented by the former administration of this government. I made that feeling fairly clear in my communications to the press and to others in this House. I certainly am looking forward to seeing a new Access to Information Act come forward.

Mr. Cable: In view of the fact that the Minister voted in favour of the Public Government Act, and the then-interim leader of the Yukon Party appears to have been supportive of the access-to-information provisions, is the Minister prepared to recommend to his colleagues that the access-to-information provisions in the Public Government Act be proclaimed into force?

Hon. Mr. Phelps: I certainly am on record as supporting the principles behind the legislation pertaining to access to information. Indeed, I was fairly pleased because I even had communications from the then-Government Leader with respect to the principles I would like to see embodied in such legislation. I certainly intend to lobby, as the independent Member of this side of this very happy group, to have those principles that I have supported in the past, and talked about at some length, embodied in new legislation that deals with access to information.

Mr. Cable: I will take that as a yes and a no and a maybe. Has the Minister determined the approximate cost of appointing and setting up the information and privacy commission referred to in the Public Government Act.

Hon. Mr. Phelps: The problems - and there are many - with the Public Government Act have to do with just how cumbersome certain aspects of the act are, and whether or not some of the principles in some areas are really appropriate for introduction into the Yukon situation.

We, on this side, feel that the principles spoken about in the access to information should be enshrined in appropriate law. We intend to move ahead to ensure that those principles are enshrined in a manner that is in keeping with the nature of this jurisdiction. That is to say, we are not simply going to go out, holus-bolus, and try to adopt something that is being introduced in other provinces.

Question re: Toward Self-Sufficiency by the 21st Century

Mr. McDonald: I would like to return briefly to the document entitled Toward Self-Sufficiency by the 21st Century, a short seven years away.

I am particularly intrigued with the recommendation contained in the report respecting the extension of the railway to Carmacks. Can the Minister of Economic Development indicate to us when this project will begin, who will pay for it, and how much it might cost?

Hon. Mr. Devries: I would like to thank the Member for his question. Basically, that was put in there as one of many various ventures that we should be looking at. There is no plan in place at all, at this point, to extend the railroad anywhere.

Mr. McDonald: I am puzzled to hear that. I understand that the document Toward Self-Sufficiency by the 21st Century was delivered to the Deputy Prime Minister of this country as a prescription for economic self-sufficiency in seven short years.

Can the Minister indicate to us why he would show a document of that nature to a the Deputy Prime Minister of the country when there is no real commitment to carry out this particular provision?

Hon. Mr. Devries: There were several different scenarios in there. One of them was a railroad, and one of them was to upgrade the highways so trucks could be used, or whatever, to haul the concentrate. The Deputy Prime Minister is very aware that these were several different ideas that were being put forward to him. Which one you went with would be dependent on the viability assessment of the project, as well as the finances available to pursue it.

Mr. McDonald: The Minister seems to be presenting the document, Toward Self-Sufficiency by the 21st Century, as a loose jumble of ideas that may or may not be important features of a self-sufficient Yukon in seven years.

Are there other elements of the document that can be characterized as a loose jumble of ideas, or ideas to which they really show no commitment at all?

Hon. Mr. Devries: I disagree with the Member on his comments. There is a vision of potential development for the Yukon, and this will be dependent upon which private sector ventures show promise toward the end of this year and next year. Much of what will happen will be dependent on that; as well, some of the decisions they make will be dependent on the government being able to put some of this infrastructure into place.

Question re: Toward Self-Sufficiency by the 21st Century

Mr. McDonald: I have another question on the same subject. The Minister characterized this document as showing vision, but he has indicated that his government has no particular commitment to the significant particulars of this document, and in fact, characterizes the document as being a loose idea that may have been dreamed up by some Yukon Party supporters, but for which there is no sense that it is realistic in our lifetime.

Does the Minister not feel that the credibility of his government with the federal government and with the Deputy Prime Minister may be in jeopardy as a result of presenting multi-million dollar ideas to the federal government, to only find out now that these ideas have no currency in Yukon Party thinking with respect to the ultimate self-sufficiency of this territory?

Hon. Mr. Devries: Again, I have to say that I disagree with the Member opposite; I cannot help it if they never had a vision for anything. This side has a vision and we are working toward making this vision happen.

Very little happened in the last few years. I feel that we are headed in the right direction, and if we do not put these ideas forward to federal Ministers and get an indication from them which ones they are willing to assist us with, then we may as well leave here, go home and go to bed because we are not going to get anywhere.

Mr. McDonald: I do not think desiring to promote economic self-sufficiency and desiring to go home and throw in the towel all depend on whether or not this particular document that we have in front of us is going to be carried out.

I would like to ask the Minister about another feature of this document: the feature that talks about the Canada Shipping Act, and the desire to encourage more competition for Canadian goods through the Skagway port. Does the Minister intend to encourage some competition for cargo handling and storage facilities at the Skagway port?

Hon. Mr. Devries: It would not necessarily pertain to only Skagway. The Canada Shipping Act also pertains to the Haines, Alaska port and we would like to see competition at any port. It is to the benefit of Yukoners to have this competition happening.

Mr. McDonald: I cannot tell you how astounded I am to hear that answer, but how happy I am to hear the answer, based on what we had been debating in the last session.

The document is entitled Toward Self-Sufficiency by the 21st Century. Is it the Minister’s view that if these recommendations, with the exclusion of at least the railway to Carmacks, were carried out in the next seven years, that we would be self-sufficient as a territory?

Hon. Mr. Devries: As the Minister knows, you have to have a vision. You have to have a goal to reach for and I do not think that it is an unrealistic goal that somewhere in the 21st century we can become self-sufficient.

It is not going to happen overnight and we have to start somewhere. If you do not start somewhere you are not going to get anywhere, and because the Members opposite made that mistake in the past, it does not mean that we are going to make the same mistake.

Question re: Curragh Inc., financial assistance

Mr. Harding: Accompanying any vision, there should be some semblance of a clue of how to get to the place the vision suggests it is going.

I would like to move on to another area. The government has now announced that they will no longer be discussing their Curragh conditions on the floor of the Legislature; yet, they have made public statements in Watson Lake that the first charge on security is not negotiable and they have also taken out full page media ads and have done phone-in shows to further politicize the conditions.

Given the potential risk to the taxpayers of the Yukon and the decision’s impact on the economy, why has the government now decided to reverse direction and discuss conditions in secret?

Hon. Mr. Devries: As the Member very well knows, that decision was at the request of Curragh and, as far as making the public aware of the basic guts of the 14 conditions is concerned, I think the public should be made very aware of where, potentially, $34 million of their tax money could be going.

Mr. Harding: It is interesting to see the government bending to each and every request that Curragh makes of them with regard to these conditions. I find that quite a surprise as a result of what they have done in the past.

The impact on the economy that this decision on the loan guarantees will bring about will be tremendous. How is it possible that the government has seen to not involve top government officials or even elected representatives directly at the negotiating table regarding these loan guarantee conditions when the discussions entail an effect of such a magnitude on the economy of the Yukon?

Hon. Mr. Devries: I find it a very interesting question coming from someone with a commerce degree - I should have thought he would have known the answer to the question. As the Member very well knows, we have very limited expertise within government on these matters and we have consultants to do such things. They will come to us with recommendations and we have the personnel to make the decisions on those recommendations and what they are based on.

Mr. Harding: Certainly, the people of the Yukon and the Members of this House are becoming well-acquainted with the limited expertise on the other side of the House -

Speaker: Order. Order please. I would like to remind both the Member and the Minister that a question ought to seek information and not be argumentative, and an answer should be as brief as possible and relevant to the question. I think what is happening here is that we are getting into an argument rather than a question and answer. I am not passing judgment on who started it; I would ask the Member to get to his final supplementary.

Mr. Harding: I will try this again. Now that the government has announced that there will be no further discussion of the negotiations with either elected representatives or the public, will the government please tell us if they intend to continue their policy of discussing their decision with the inner circle of Yukon Party supporters, as they did with the original publicly released conditions and the Taga Ku project?

Hon. Mr. Devries: I would never say that Yukon Party supporters are not the public. I will not be discussing it with them either.

Basically, this decision will be made by Cabinet at some point. We feel that it is an important decision. It is important to the Yukon, particularly Faro and Watson Lake. We are giving it our best shot.

Question re: Court reporting contract

Ms. Joe: I have a question for the Minister of Justice or the Minister of Government Services. Most of us here are familiar with the court reporting and recording contract being awarded to an outside company. This causes a great deal of concern among those affected due to the loss of jobs for the people presently providing that service. I understand that this is not the only local company affected by this change to contract jobs outside the Yukon.

Can the Minister tell this House whether or not it has a new local-hire policy?

Hon. Mr. Phelps: No, there is no new policy on that.

Ms. Joe: It appears that this government, by its actions on local hire, is partially responsible for the rise in the unemployment rate in the Yukon with its actions of awarding contracts to outside firms. I would like to know what this government is doing to assure Yukon people that their jobs will be retained, and that their jobs will continue, rather than having to give up their jobs to outside firms.

Hon. Mr. Phelps: I would like to be able to give a short answer, but it might take me all afternoon to fully answer that question.

This government, wherever possible, hires locally and awards contracts locally. However, there are limitations on the ability of the government to do that. In the situation the Member is referring to, great care was taken to have a good evaluation of each of the tenders. I am convinced from my investigations that it was done in an open and objective manner and that due attention was given to the issue of local hire.

Ms. Joe: I am getting a lot of concerns registered to me by the people who will be losing employment as a result of this outside hiring and contracting. One of the biggest concerns is not just that these people may have to pack their bags and leave the Yukon, but also that, due to the manner in which the service will be provided, there will be a poorer quality of service in the courtrooms.

Can the Minister tell us if this is a done deal and that these people can now pack their bags and leave?

Hon. Mr. Phelps:  The issue of quality of service is one that was certainly examined very carefully by the officials, in consultation with a number of stakeholders in the system. It certainly was not an issue that was taken lightly by any of those people who, independently of each other, applied the criterion and evaluated the bids. With respect to whether or not the tender has been awarded, I can only tell the hon. Member that the contract has not yet been signed between the number one ranking company that tendered and the department.

Question re: Contract policy, restructuring

Mrs. Firth: I think there is a script that is written for Ministers. If I close my eyes, I have heard the same words from when these Members were over there. I am finding it quite astonishing.

I would like to ask the Minister responsible for Government Services a question. The Auditor General was very critical in his report on “any other matter” about weaknesses in the government’s operating practices, particularly regarding preferential treatment for former government employees, contracting without the proper tendering, and some departments just not following the rules. The Government Leader has commented publicly about this report and said that they were going to use it in planned restructuring of the Government Services department. I would like to ask the Minister if he can tell us, either exactly, clearly or specifically, what planned restructuring is in this case?

Hon. Mr. Devries: I do not have the report at my fingertips, although I have reviewed it quite comprehensively. There are several things pertaining to contract regulations that we are looking at: the overall philosophy in building management, the philosophy in contract administration when it comes to buildings, the building philosophy itself; there is just no end to it. I could not just stand here and answer it all at once.

Mrs. Firth: I think the Minister could have; he just could have said no. I like to keep track of buzzwords, or the art of not saying what you mean. When I read a translation of what “restructured” means, it generally means “a whole bunch of you lay-abouts better watch it; some of you are going to be trashed”. I want to ask the Minister, seriously, exactly what policy direction is being given, and what restructuring is going to go on in the Department of Government Services.

Hon. Mr. Devries: Some of the instructions I give to my department are to try to avoid the confrontational approach when it comes to management of construction projects. Under the previous administration, there were problems in this respect. There are various things being discussed that will be brought up during budget debate, which I cannot talk about right now. That is basically all I can answer to one question under your rules, Mr. Speaker.

Speaker: They are our rules, Mr. Minister.

Mrs. Firth: Essentially, the Minister is saying that he is just telling the department to be nicer guys when they break the rules, or when someone is given preferential treatment with a contract, or if they are not following proper tendering procedures.

Will the Minister bring back to the House a detailed, specific policy direction that department has been given, in light of all the criticism they have received and the government’s announcement that it is going to be restructured? I would like that ASAP because, if it is being done, it must be written down somewhere, unless someone is just making it up.

Hon. Mr. Devries: Yes, I will do that. I would like to comment on her preamble: as long as this Minister is there, there will be no preferential dealings.

Question re: Social housing

Ms. Moorcroft: Back in December, the Minister responsible for the Yukon Housing Corporation suggested a possible compromise between the city and the Gateway Housing proponents in Riverdale. If this project dies, does the Minister have an alternative site or project, so the desperate housing needs of some Yukoners can be met? Can the Minister state to the House if progress is being made on finding either a solution or a replacement project?

Hon. Mr. Fisher: We were able to negotiate with the federal government to actually have the funds for the Gateway project proposed for a revote in the 1993-94 budget. There will be a project in 1993-94. Whether it is the Gateway project, or some other one, I am not sure, because Gateway and the City of Whitehorse are currently before the courts.

Ms. Moorcroft: A large number of jobs and economic activity would be provided by this project, as well as the needs of people for social housing being met. Can the Minister specify how they are going to secure this funding for the next fiscal year, or will they have some sort of substitute planning from Ottawa so that these project jobs and housing units will not be lost?

Hon. Mr. Fisher: I believe that I have already answered that. We have assurance from the federal Minister responsible for social housing that the funds for the Gateway project will be revoted in the 1993 fiscal year.

Whitehorse General Hospital, local control

Ms. Moorcroft: The Minister of Health and Social Services has said that a local board could be running the Whitehorse General Hospital by April 1, 1993. Will this deadline be met? If not, why not?

Hon. Mr. Phelps: The issue of hospital transfer really depends on what happens in the next week or two. It turns on the submission being approved by Treasury Board so that the funding goes into place, and so on. That is really the big event that we are working toward. Once the Treasury Board approval is signed we can make certain commitments. Until it is, it is difficult for us to do so.

With respect to the hospital board, we are working toward being in a position to appoint members in accordance with the various agreements that pertain to those appointments.

Ms. Moorcroft: Within the transfer agreement of the hospital board, the Council for Yukon Indians is guaranteed three appointments and consultation on the remaining appointments. Has the government met its obligation to consult with CYI and other groups on these appointments, and will the Minister describe to this House what consultation has taken place in order to achieve a representative board?

Hon. Mr. Phelps: I am aware that the side opposite has a mole who works for at least one First Nation and probably phones regularly on issues about land claims - perhaps to the detriment of the CYI and the First Nations, but that is a different issue.

Speaker: I would ask the Minister to keep answers relevant to the question.

Hon. Mr. Phelps: Despite the fact that the mole is responsible for negotiating the terms that Ms. Moorcroft refers to in her erroneous premise, with respect to consultation, that mole ought to know better. The provision for consultation extends to the three whom they appoint and the two public people who are appointed by the government.

Ms. Moorcroft: Whitehorse General Hospital has a tradition of providing abortion services to women who choose to terminate a pregnancy. In selecting the hospital’s board, will consideration of this tradition be upheld, and will the Minister assure this House that a woman’s right to choose will be guaranteed?

Hon. Mr. Phelps: In answering that question, let me make it very clear that, to the best of our ability, we are going to stay away from making appointments of people who have a political axe to grind in fields such as the issue of right to life, abortion, women’s rights, and so on - those sensitive areas. This Minister supports the right of women to choose, and I will be bearing that in mind with respect to what input I have into the process.

Question re: Land claim legislation through Parliament

Mr. Cable: I have a question for the Government Leader: last Wednesday night we passed the historic land claim legislation, and we all indicated that we would be contacting people on the federal scene who we felt would have some sway over when the bills would be moved through the federal Parliament. Has the Government Leader had an opportunity to speak with either the Prime Minister or the Minister, Mr. Siddon, advising them of the passage of the bills and urging them to move the process through the federal Parliament?

Hon. Mr. Ostashek: Yes, and I thank the Member opposite for the question. The motions will be forwarded to the Minister of Indian Affairs in Ottawa; I will be speaking to him shortly and I will be impressing our concerns upon him. Up to this point, I have not yet been in touch with him, but I fully intend to do so.

Mr. Cable: As soon as the Minister or the Prime Minister has informed the Government Leader as to what is going to happen, will the Government Leader undertake to inform this House as to the status of the passage of the bills?

Hon. Mr. Ostashek: I have no difficulty in doing that. I just want to reiterate for the Member opposite that, in the speeches on Wednesday night and in discussions in this House, I talked several times about the meeting Mr. Siddon, Ms. Gingell and I had in Vancouver several weeks ago, where each of us again stated our full commitment to seeing that land claims legislation be passed before a federal election is called.

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

ORDERS OF THE DAY

Speaker: Government Bills.

GOVERNMENT BILLS

Bill No. 4: Second Reading

Clerk: Second Reading, Bill No. 4, standing in the name of the Hon. Mr. Ostashek.

Hon. Mr. Ostashek: I move that Bill No. 4, entitled Second Appropriation Act, 1992-93, be now read a second time.

Speaker: It has been moved by the Hon. Government Leader that Bill No. 4, entitled Second Appropriation Act, 1992-93, be now read a second time.

Hon. Mr. Ostashek: I rise today to speak on second reading of this bill. This bill appropriates additional monies for the 1992-93 fiscal year.

The year-end expenditures are based on projections done as of November 30, 1992. Additional expenditure authority of $37.4 million is sought for the current fiscal year.

These additional expenditures, when combined with a small downward change in our overall income, result in an increase of $38.6 million in our annual deficit.

This increase, when added to the annual deficit projected in the main estimates for the current year, brings the projected deficit for the 1992-93 year to a staggering $57.9 million.

The Government of Yukon began 1992-93 with an unconsolidated, accumulated surplus of $50.8 million. The projected annual deficit that I have just spoken of will throw us into a accumulated deficit position of approximately $7 million.

I should note that this is somewhat more pessimistic than the $5.7 million, March 31, 1993, accumulated deficit projected by Consulting and Audit Canada in their financial review that we had done upon taking office.

The current supplementary is based upon more up-to-date information that was the result of a formal period 8 variance report exercise completed by government departments.

While there has been some question about the accuracy of the Consulting and Audit Canada report, I would hope this supplementary puts that to rest.

It should be pointed out that a draft supplementary prepared by the previous government, based on projections made as of July 31, 1992 - for example, period 4 - showed an accumulated deficit on March 31, 1993, of $10.2 million.

Even under the best possible circumstances, we have, in the past two years, spent $50 million to $55 million more than we took in. It must be apparent to everyone that this simply cannot continue to occur.

The supplementary I have just tabled, I believe, would have been even larger if it had not been for the expenditure control actions we undertook upon assuming office.

As Members of this House know, we have instituted measures to bring outside travel, hiring and discretionary expenditures under control. While it is difficult to quantify the dollar impact these measures have had, we do know that the number of employees hired has decreased from 107 in January, 1992, to 54 in January of 1993. That is a 50-percent decrease, worth in the neighbourhood of $200,000 a month.

In the period November 1, 1991, to January 31, 1992, a total of 1,401 purchase requests were processed by our purchasing branch. For the same three-month period from November 1, 1992, to January 31, 1993, there were only 955 purchase requests processed, for a 32-percent decrease. Similarly, airline bookings have dropped by 45 percent.

We will continue to seek efficiencies in these expenditure categories, as well as elsewhere, to ensure that we do not spend public monies needlessly and that those monies that are spent are spent in the most cost-effective manner possible.

The previous government had approved and committed, through its Management Board, approximately $36 million in additional expenditures for inclusion in the first supplementary it was going to table for the 1992-93 fiscal year. In addition, it was fully aware of a number of other expenditures for which supplementary funding would be required, but for which no formal approval had been given. Social assistance costs were one of these items.

It is apparent that the bulk of the current supplementary was already committed by the time we took office, although we have been able to achieve some savings through stringent expenditure management.

The largest single item for which funding is sought is a revote of lapsed 1991-92 capital monies. This item accounts for some $13 million and is distributed among seven or eight different departments.

The next most significant item is the Department of Community and Transportation Services, where the devolution of the Alaska Highway requires an additional $13.5 million in capital spending to be approved. This item has no impact on our surplus or deficit position, since it is accompanied by an increased federal transfer payment funding, or by recoveries.

The Department of Health and Social Services requires almost $14 million in supplementary O&M funding. This is a 21-percent increase over the funding projected in the main estimates tabled only one year ago. It is probably fair to say that some expenditure categories in this department are out of control. We must get a handle on these expenditures, which have been left to run loose, or accept the fact of exponential increases for health care and social service at the exclusion of programming for education, economic development, roads and all other essential activities carried on by government.

The Department of Education is requesting an additional $3.9 million for operation and maintenance purposes. These monies are largely necessitated by the additional teachers that were required to meet our expanding student population.

A number of other departments require additional money, and a number are lapsing monies, the details of which are best left to general debate on this bill.

Members will note that the loan capital vote has increased by $5 million. This represents the monies previously loaned to Curragh Resources. It has no impact on our surplus or deficit, because the loan is carried as an asset on our books.

It should also be noted that the loan interest vote requires an additional $155,000. This represents projected interest we will pay this year on our line of credit with our bank. This past February was the first time the Yukon government has ever had to borrow money to finance day-to-day operations. This results from a decline of our accumulated surplus and cash balances.

Our revenues have declined some $9.5 million from those projected in the main estimates. Income taxes are down, based on most current estimates we have received from the federal government. These estimates are subject to modification and may reflect the economic situation in the rest of the country, rather than the Yukon.

Investment income has also declined significantly as rates continue to drop beyond expectations and our cash reserves disappear. The Liquor Corporation net income has declined due to capital investments being undertaken by the corporation.

Transfer payments from the Government of Canada have increased substantially. This increase is partly due to the decline in the other revenues mentioned above, since the workings of the fail-safe provisions of the formula financing arrangements pushed the transfer payment up, when our own-source revenues declined. The increase is also due to the devolution of responsibility for the Alaska Highway, whereby we received new monies in our formula base, where the capital funds are transferred to us by the federal government, and where the operation and maintenance funds previously shown as recoveries are now part of the transfer payment.

This fact also largely accounts for the decrease shown in the recoveries. Unfortunately, the increase in transfer payments is far less than the sum of the items mentioned above. This has occurred because of growth in our formula financing base is capped by the rate of increase in the Canadian gross domestic product, and the past dismal performance of the Canadian and world economies has kept the rate of increase lower than could have reasonably been expected.

The Canadian economy now seems to be improving measurably and we would hope for a larger rate of growth in our transfer payment next year. We should also receive a favourable adjustment of at least $14 million in our transfer payment in 1993-94, as a result of the final census figures and their adjustments for under counts made to those figures.

These are two bright spots in an otherwise tight financial picture. I do not propose to go any further into detail at this time, since we will have the opportunity to discuss these matters at some length in Committee debate, where I am certain Members will have many questions.

Mr. McDonald: To address the Government Leader’s final point first, it is quite true that the Opposition Members will be levelling many questions to Ministers, particularly to the Finance Minister, with respect to the projections shown in the summary information in the budget. Before I get down to any thorough discussion of some of the figures in the estimates, I should provide some contextual comments in order that Members might become aware of the kind of thinking that has gone through my mind in the last few months and my assessment of the government’s performance with respect to financial management, financial forecasting, budget management and budget development.

We heard today a slightly different perspective from the one that has been levelled in the past with respect to who should take responsibility for the budget. We have heard a slightly different variation on the reasons why the government is interested in painting an overly pessimistic picture of the government’s finances and the fortunes of the territorial economy. Today we have seen that the latest gambit is that the budget was really preapproved prior to the election and prior to any supplementary being developed - preapproved by the previous NDP administration - so therefore we should just simply ignore the major debate and focus on the details.

I cannot do that because, in all consciousness - in all conscience, rather, although consciousness sounds like some Members in this House - it would be misleading and inappropriate for me to state that the NDP administration and the government Ministers had agreed through Management Board to approve the kinds of expenditures that the Government Leader is saying are now the fundamentals of this particular supplementary.

The NDP did not approve a supplementary. The NDP committed itself to revotes of capital projects previously approved in prior years so that those revotes might continue; but the Management Board of the NDP government did not approve the expenditures - certainly not the kind of expenditures - that the Government Leader has tabled before the Legislature this afternoon.

I would like to say as well that, had the NDP been in government, to paint such a pessimistic picture and to try their best to be the purveyors of doom and gloom, as the Government Leader seems to be doing, is not something I would have personally agreed to as a Member of that Cabinet.

Now the Government Leader has admitted in a very roundabout way that perhaps the financial forecasting of last November and December was not as accurate as they originally wanted to paint it, but no need to fear, the bottom line is still the same: it is still a projected $57 million deficit.

Even though there were glaring errors in the financial forecasting that was done last November, and given the fact that it has only been the most tardy and reluctant admission to that fact, we should now rise above our concerns about the integrity of the financial forecasting done in the past and simply believe them a few months later. As I will explain in some detail, I think to now give the government the benefit of the doubt, after their previous attempts at financial forecasting, would be as irresponsible as for us to have faith in their budget projections at this point.

It is impossible to analyze any budget outside the context of the economy in which the government operates. I would like to make a few remarks about that, because I think it is an important feature of any budget debate.

Typically, debates have a tendency to be inward-looking, focusing on what governments do and what programs they manage without considering in the full light of day what happens within the community in which we live and are sworn to serve.

On October 19, we not only saw the transfer of government, we also saw the beginning of a recession. It was a recession that was largely engineered by the comments of the Members opposite and before long, after hearing about Taga Ku and about the reluctance to deal with the hospital transfer, and after seeing the potential for some serious concerns at Curragh, we saw a cloak of doom slowly spread over the territory. We saw government Ministers as prophets of gloom go on and on about how difficult it was to make the kinds of choices that they needed to make to fulfill their election promises.

In the intervening period we have seen unemployment rise from approximately 8.5 percent last November and December, to approximately just over 14 percent this month. We have gone from three points below the national average a few months ago to three points above the national average this month.

We have seen what the government opposite characterizes as economic leadership being punctuated by glaring and truly unfortunate missed opportunities, such as Taga Ku and hospital construction. We have seen what amounts to a shocking fumbling and bumbling of the Curragh Mine recovery negotiations.

What we have is an unemployment rate that has risen dramatically, social assistance costs that have risen dramatically and income tax revenue that is significantly down.

The double-barrelled message to investors outside the territory is, as I am sure the Members’ opposite would characterize it, that we are open for business and welcome them to the recession.

Aside from the doom-and-gloom talk, we have also heard on a number of occasions - when things get a little tough - that the federal government can step in and do this and that in order to salvage what might otherwise be characterized as a faltering economy. This is in considerable variance with remarks that have been made in the past about a desire for us to be more self-sufficient.

We have seen all the pomp and circumstance around the federal government’s proposal to spend an extra $10 million. This is supposed to breed more economic self-sufficiency - getting more money from the federal government. We have seen a preponderant dependency on a request for the re-introduction of flow-through shares, as a tax expenditure, of course, which would be a further demonstration of our dependency on the federal government. When times really get tough, we are reminded that mining, in particular, is a federal responsibility, as are environmental regulations, and that they should get down to business and help out.

The only thing that is different from the previous administration is that we have in front of us is a document, entitled Toward Self-Sufficiency by the 21st Century. It is a document to which, as we have come to understand today,  the Yukon Party Ministers or the Independent are not necessarily particularly wedded. This document is basically a list of megaprojects being paraded before federal Ministers on the assumption that they will really be intrigued by this new approach to economic self-sufficiency, coming from Yukon government Ministers, and that they will invest a lot more in the territory so that, ironically, we can become more self-sufficient.

I recall that when we used to invest large amounts of money into the capital program, we used to get criticized regularly by Yukon Party Members opposite, because that was a reflection of our admission of our dependency on the federal government - that we had to spend federal money in order to do this.

All we have heard from the Members opposite is the requirement that we get more from the federal government and that, through general infrastructure development, we undertake a few dozen megaprojects, which, we learned incidentally from the Yukon Economic Strategy discussions were examples of high leakage in the economy. The expenditures made were typically short term, and the Yukon public generally ended up with some crumbs.

The cruelest irony in that list of megaprojects is that there was a call for a convention centre, which the government had in their hands and let slip through their fingers for a variety of political reasons, I am sure.

While I would like to get involved in a discussion about mining more thoroughly, and I was going to take up some of today’s time to discuss mining and mining program support, I think I am going to have an opportunity, come Wednesday, to discuss this matter, if the private Members on the government side are permitted the opportunity to move a couple of their blockbuster motions. It will give us all an opportunity to explore support for mining and what is smoke, what is mirrors, and what is real.

I will save my remarks for Wednesday.

I would like to turn briefly to the government’s fiscal position and their stance since coming to office. As I mentioned in December, the moment these folks in the Yukon Party came to office on October 19, they almost immediately started complaining that they had to make some tough choices, had to admit that their stated way of finding money during the election campaign - which was simply not to do the bad things, and only do the good things, or some sort of arrangement like that - was probably gobbledegook and, consequently, was not a surefire method of freeing up available funds to meet election promises.

They realized very early on that there was not money for everything, so even before there was ever any analysis of the government’s financial picture, we were treated to stories of how there was not enough money, and it was consequently the NDP’s fault. Rather than doing the professional and mature thing, they started scapegoating virtually from the very beginning.

To contribute to this image of a tight fiscal position they wanted to create, they initiated what they called a hiring and travel freeze, both of which thawed out very quickly, and they undertook to create an environment where people in this territory would feel that, not only was the money tight, and the situation bleak, but they could not expect anything from the government, and their expectations had to be purely collapsed, and the fault for this new government policy was that of the NDP.

When it became obvious that they required some more justification for saying that there is no money, rather than simply saying so, they asked for a financial review. I will briefly touch on the financial review as I have a lot more to say about that in the supplementary estimates general debate.

As a forecast, upon investigation, the forecast of required expenditures has been misleading. As a snapshot of where we sit financially, the review was dishonest. As a political document it was transparent.

We have discovered, since our initial review of the financial forecast, which was supposed to be the first justification for financial doom-and-gloom message, that the forecast itself was a terribly flawed document. We discovered that there was double counting of the expenditures, amounting to millions of dollars. The executive summaries of that document bore no relationship to the body of the document itself. There was virtually no information respecting the financial recoveries and the revenue side of the picture.

Speaker: Order please. I hope that the Member is not leading into accusing another Member of uttering a deliberate falsehood or being dishonest.

Mr. McDonald: On that point, every time you raise the subject it is reported that I am intentionally doing something, so when I recant, only to follow the rules of the House, it is reported that I have taken back any accusations that I have delivered. I do not claim to have made any accusations of that sort.

What I have claimed to do is to indicate that the information that has been put forward is dishonest. I truly do believe that to be the case.

Speaker: I was simply cautioning the Member as to his direction; I was not aware of it. I understand that the Member is aware of the Standing Order and will respect it.

Mr. McDonald: I will not be overtly accusing people of dishonesty but I will accuse this document of being dishonest. I feel obligated and duty-bound to say so as I think it is the responsible thing to do.

The fact that over the last number of years the Yukon government has under spent its budget by an average of $18 million has been withheld from any public documentation that the Members on the government side use to explain their financial position. There is no explanation for any adjustment to the population growth, which, under formula financing, could give the government between $7 million to $15 million.

The financial review, that the government has at times treated as an audit, is clearly not an audit.

Obviously an annual audit done by the government takes months to prepare. This review took, probably, a total of a couple of weeks to prepare. Departments had only a few days to pull together information, and then no opportunity to check that information once it was submitted to the people who were to collate and digest the information. This separates the government’s financial forecast quite remarkably, from that of a normal audit or supplementary budget review.

The review contains, in its particulars, many items which amount to wish lists from departments. As experienced Ministers, we can identify those immediately. The Ministers on the Yukon Party side simply bought the message from the departments hook, line and sinker, and effectively cried, “Foul” when they found out that they would ultimately have to take these budget requests into the Legislature.

The financial review had some important controls, which were built into the actual supplementary budget process, but which were missing in the development of the financial figures.

There were items contained in the financial review that were misleading. For example, the review cited that there were stay-in-school initiatives in the Department of Education that would cost the Yukon government $600,000 and failed to mention that these items were recoverable from the federal government.

There were requests for money which were, in many respects, mistakes. They have asked for money for buildings that are not open, in the millions of dollars. They have indicated that, in one particular department in reference to the health investment fund, the review claimed that there was a $500,000 expenditure in 1991, when only $66,000 was spent. This sounds like only a minor difference of $434,000, but there are many examples where these small amounts of $200 to $400 - and in one case, $8 million in the Executive Summary Review where the wages and benefits in the Department of Education had been double counted - all together add up to two things: first of all, that the numbers are not trustworthy and secondly that the forecasting is not trustworthy. We must take these flaws into account when we assess the reliability of not only this forecast, but of the government’s forecasting - period. It was interesting to note that in the past couple of months, even though the government has quite rightly tried to distance themselves in a backhanded sort of way from the financial forecast, they still have insisted on clinging to the figure of $57 million as a projected deficit.

It must have been that they have been told that to change the final figure for a particular deficit would confuse the public. Clearly, when one analyzes the budget here and considers the basic rules of budgeting, one would have to conclude that the financial forecasts now are every bit as untrustworthy as the financial forecast was in the first attempt at determining what available funds there were.

What the government has now done in tabling the supplementary is to announce that the financial problems we face are now, as they characterize it, under control. They have indicated that there is now no longer a travel and hiring freeze. In their words, they have caught it just in time, and we have now all been saved by the fiscal responsibility of the Yukon Party.

After seven years of budgeting and six years of Auditor General’s reports, we are now expected to believe that the Yukon Party, through a travel and hiring freeze, has managed to get the government’s budgets under control and put us all back on the right track. The hiring freeze is an interesting example of double talk. We only heard a couple of months ago, from a leak in the Public Service Commission, that the employment in government had risen in the first three months of the government’s term of office. We also heard that the savings from a travel freeze was a reflection of the government’s tight-fisted approach to managing government travel. In a document they distributed widely, they even claimed that “the result was that travel for government purposes by government employees between early November 1992 and the end of January 1993 dropped by 45 percent over the same period one year earlier.”

In the main estimates for this budget, we had already committed to reducing travel by departments by 25 percent. So the government, in their own estimates, have suggested that they have dropped travel expenditures by 45 percent, and they are taking credit for the full reduction.

That is dishonest. The government has also indicated that they have controlled government hiring and yet we hear, by some slip of the tongue, that government employment has risen.

The government has indicated that they are going to reduce politicians’ and support staff salaries by five percent. In the case of performance pay this might be justified, if a five-percent cut was levelled on Ministers’ pay.

As a matter of expenditure reduction, they have probably offset that simply by failing to institute a deputy minister firing freeze. The government has certainly made major expenditures in that area that they have not communicated to anybody, let alone in the propaganda documents that they have widely distributed throughout the territory.

In this document that the government has sent out to everyone indicating that everything is now under control, the government indicates six basic reasons why everything is under control.

The travel freeze, the employment freeze - which is not a freeze, but rather there seems to be an increase in employees in government - the reduction in politicians’ pay, which we know is easily offset by the severance pay for deputy ministers.

The government indicates that a new and efficient incentive policy is being developed to better manage government expenditures.

We have seen no evidence of this new policy and in fact, I would hazard a guess that once they have developed a policy they would be trumpeting the policy around the territory.

Unfortunately, one cannot take from this document and from this commitment that the government has been able to do anything to get government expenditures, as they put it, under control.

The government says that they are doing a review to look at such things as policies covering government purchases and recruitment of personnel. This increase of efficiency in government is going to get the money and spending under control.

This particular policy review, if and when it ever happens and is concluded, by itself, I would hazard to guess, will do very little to reduce public expenditures.

The government also indicates that a mechanism is being developed to ensure new government buildings are constructed in a cost-effective way and are modest and efficient in their operations.

This is an laudable goal, but one has to ask whether or not they have built a single building or been involved in the development of a single structure since the period that they have been office. How can the government possibly use this particular goal, laudable though it is, as demonstrating why they should now be considered efficient financial managers?

The bottom line appears to be that, in order for them to avoid deficit financing, they are going to do one of three things: they are going to reduce expenditures, raise revenues, or a combination of one or the other. This is a brilliant piece of work. I must say that, if somebody had not told me, I would never have guessed that that might be the way to balance one’s books.

To make it now a science and the cornerstone of all political communications coming out of this government is, in effect, a way to deflect the public’s attention from some of the real issues this territory faces. Over the last few months, we have witnessed a fixation on government expenditures, to the extent that the whole territory has been thrown, willy-nilly, into a period of gloom that has affected every small business and workplace in this territory.

We see a situation where normal government procedures to balance their books and manage their finances has been the only communication coming out of this government. We are entreated to watch them, as they move from day to day, in attempts to balance their budgets and keep their expenditures under control, something the NDP government did for seven years, and something every other government on this continent does every year.

These people have made it almost a religion to have us watch them as they go about doing the right thing.

This brings us to the supplementary. What is amazing about the supplementary is that, in a few short months, even though the numbers in the forecasts and in the body of the supplementaries are different, we are all supposed to magically come to the conclusion that the bottom line figure of $57 million is the same.

We have no explanation in this budget document for the revenue collapse, although I am sure we can guess as to why some revenue has collapsed in the last few months, given the decline of economic activity in Faro and Watson Lake. We are given no explanation as to why the formula agreement did not offset a major portion of that reduction in revenue. We have no explanation as to why the investment income was not offset. We appear to simply just have to bear the full reduction in that particular area, as well.

There is no explanation as to why we are expected to spend an extra $13.5 million in capital funding for the Alaska Highway and we show only a recovery of $3.5 million for the same construction activity.

There is no explanation why we should believe that we should be spending more on land development than we have probably ever spent in the history of the territory - a line item which is typically overstated and always comes in under the estimates. Yet, apparently, we are going to be spending an extra $5.5 million in this particular field.

We are not given any explanation in the Government Leader’s preliminary remarks as to why we should believe that the government, in this last year, is actually going to have spent $120 million in the capital budget. There must have been so many examples of government construction activity out there that, somehow, we are magically going to be spending virtually more than we have ever before spent on capital activity.

There no admission that there will be any capital lapses and there is no admission that there will probably be operation and maintenance lapses. We have been given no explanation as to what the expected formula financing increase is finally going to show as a result of the population increase in the territory. We know at least that the Department of Indian and Northern Affairs has budgeted $247 million for a transfer payment to the Yukon government, which incidently is $2.5 million more than the supplementary budget shows. We know that they are budgeting for an increase to the transfer payment to a total of $261 million for the main estimates coming up, presumably to be tabled this week, which is a $31 million increase over the main estimates of last year.

With these apparent problems in the forecasting of revenues, recoveries and expenditures, we clearly have to show some concern about what the budget is telling us today and whether or not we can depend on these figures to be reliable, any more than we could on the financial forecast, which is a dangerously flawed document.

So what have we seen? We have seen a government that almost, in and of itself, has gone to such a great extent to engineer an economic collapse in this territory, through its actions with Taga Ku and Curragh in particular. We have seen a government that has had great difficulty managing and handling the responsibility that is charged to it for making choices and setting priorities. We have seen a government that in the last few months has mastered only one thing and that is to pass the buck, shirk responsibility and turn the equation around so that someone else must make tough decisions.

I would be very surprised if, in October of this year, when the financial forecasts are turned into audited statements by the Auditor General of Canada, we are looking at a $57 million accumulated deficit for this year. I find it to be dishonest for the Members opposite to be tabling -

Speaker’s Ruling

Speaker: Order. Order please. I have asked the Member not to use the term “dishonest” in referring to other Members. The Member does not have a duty to accuse other Members of being dishonest; he has a duty not to refer to them as being dishonest. If the Member wishes to do that, he can certainly do it outside the House. He can make very clear what he thinks of the other Members in the government, but in this House he will not accuse other Members of being dishonest.

Mr. McDonald: I was referring to the figures as being dishonest.

Speaker: The Member, I know, has the creativity and the intelligence to get his message across without using that terminology. I can suggest other language like he has used - “unreliable”, “not accurate” - but it is clear to me in the Chair that the Member is making an accusation of dishonesty when he is talking about the figures and I would order him not to do that.

Mr. McDonald: Mr. Speaker, I will take Mr. Speaker’s suggestion about the lack of reliability because I think it is obvious; and, but only because Mr. Speaker commands it, I will avoid using the word “dishonest”.

We have seen a situation in the last few months where the economy of the territory has basically gone into a nose dive. We have seen a situation where the Yukon Party has failed to show the economic leadership it needs to provide the kinds of incentives in the economy to bring about a recovery. We have seen the Yukon Party in fact wishing to create the impression that things are bleak so that they can find a way to blame the fact that they cannot meet their election commitments on someone else. We have seen the financial forecasting done by the government, which is, as Mr. Speaker suggests I say, “misleading”. We have seen a situation where, in a very transparent way, the government opposite has taken a budget exercise and turned it into an inappropriate political exercise. That is permissible.

I personally have no faith in the integrity of the government’s forecasting. I am disappointed in their politicking style of buck-passing, and I am upset by their vision of what the economic leadership of this territory is all about.

That characterizes in a nutshell what I feel about this latest political forecast of financial expenditures. We certainly will have questions to ask in detail when the budget reaches Committee debate, and I am hoping that the government, at least in this preliminary round, will be able to give us some reliable answers.

Hon. Mr. Phelps:  The people on the side opposite, who were in government at the time, knew full well that their finances were in a shambles and that they were out of control. They must have known, because the period 4 variances were signed off by the Ministers in the government at the time.

This government took over in November. At that time, it became obvious that we were in trouble. It was very clear that the expenditures of the previous administration were totally out of control. The task we had, and have before us, was to turn things around somewhat, and that is not something that is done overnight. We had to get a handle on the escalating deficit and expenditures and slow them down and turn the ship away from the reef it was headed on a collision course with, and out to open sea.

The hon. Member across the way can laugh, but he was the architect of the mess. He was one of the pilots of the ship. He is the one who plotted the course that was taking government right onto the shoal, and he knows that. I cannot believe - and I do not, for one minute, believe - that the hon. Member, when he was Minister, did not take his job seriously and do the best he could, so he must have been aware of the terrible mess into which we had been led, with him and Members of his ilk at the helm.

We had to turn things around enough so we could start looking at a budget, next year and in future years, that would be balanced. We had to look at a government that was not completely out of control and spending every available dollar on operation and maintenance expenditures to a situation where there would be a decent proportion of budgetary monies available for capital projects, so the private sector could survive in Yukon’s economic climate.

We took, collectively on this side, a lot of steps to start the ship turning, heading out toward open sea, away from the shoals that the socialist helmsmen seemed to be attracted to as though they were a magnet.

Many of the steps that have been taken are in the public eye. The Minister responsible for Finance has mentioned, for example, that airline bookings have dropped by about 45 percent because of the controls we have put in place. All hiring was scrutinized by Management Board and a clear policy was put in place with respect to hiring.

An in-depth review of many of the programs and policies that were getting this government into trouble were undertaken. Some are still proceeding and are not completed.

Some other things were accomplished very quickly - for example, to restrict the mandate of Yukon Development Corporation so we would not have any more Watson Lake sawmills and flagrant disregard for the ratepayers’ money and the Legislature, which ought to be able to vote monies expended by government departments. That was done very early on, as policy, and numerous other processes were put in place so that, in a rational way, this government could start to take control of the expenditures and avoid the waste.

I find it rather sad that a senior Member, such as the one who just preceded me in speaking order today, would stand in his place and not acknowledge the terrible financial difficulties the government was in, particularly during the last year or so of his tenure as Minister of the Crown. The public knows. The public is well-aware of all the waste that was taking place. A good deal of the election was about that waste, about the lack of control and the lack of prudence in government spending. A judgment was handed down by Yukon residents in the election that was held. That was an issue that was on the tip of most Yukoners’ tongues during the whole 30-day period of the election campaign. The public was aware of the trouble we were getting into at that time.

The hon. Member now stands in his place and tries to deflect some criticism by suggesting that the economic downturn that has been felt in Yukon is something new that just happened because of action taken by the new government Members since November 7.

The public is not going to buy that. That is not the case. The collective wisdom of the people is something that I have faith in, and I urge the hon. Member who spoke before me to have some faith in and seek some solace in it as well.

It is amazing when one thinks back and contrasts what the new Government Leader this time is facing with what happened in 1985, when the government changed. In 1985, a surplus was handed on to the successor government in excess of $40 million. This time, the NDP government made sure that every nickel in the bank was being spent and we were faced with no surplus at all, but a deficit, and not only that, a situation in which the government had plunged out of control and for the one year is looking a deficit of $57 million - in one year.

The new Government Leader has to turn this around. This is not easily done.

In 1985, when the government was handed over to the NDP bunch, Curragh had been out for some time. Most of the groundwork had been laid to deal with that very difficult problem. I still have the briefing notes I received that showed exactly where both governments were on what to do about Curragh. Most of the thinking and strategy had already been done, primarily by the federal government and through the auspices of Erik Nielsen. This time, the new leader faces a situation where Curragh is threatening to shut down completely.

Back in 1985, there were other mines operating. We were not dependent on one large corporation in the mining field. However, we have seen mines disappear under the previous NDP government, so that Curragh is now the only game in town.

In 1985, we had just signed off the formula financing agreement, which gave to the new government tens of millions of dollars to spend on new capital projects. It was designed that way.

Speaker: Order please. I do not want to interrupt the Minister’s speech but, what I would like to do for all Members is read Standing Order 57(2). With the direction that the debate has been going, we may run into the Speaker having to rule.

Standing Order 57(2) states; “The debate on a motion for second reading must be limited to the object, expediency, principles and merits of the bill, or to alternative methods of obtaining its purpose.”

Although this is very broad, I would like to ask the Minister and other Members to try and keep their remarks within the object, expediency and principle of the bill.

Please continue, Minister of Justice.

Hon. Mr. Phelps: As always, I agree with the wisdom of the Speaker’s ruling. I guess I was led into bad habits by the person who spoke before me. I will try, in future, not to use his speeches as a precedent for any of the things I have to say.

The situation is vastly different between what the government he was with encountered, as they stepped into the role as government, and what happened this time around. This is pertinent, because we are discussing the supplementary forecast for the budget we inherited when we took over in period 8 of the fiscal year.

In examining the books, in reviewing the manner in which these books were prepared, and having had a keen interest in that area of government - as my brief tenure as a former leader of the government and a much longer role as Leader of the Official Opposition and Finance critic - it is my view that these estimates were prepared in exactly the same manner that they have been prepared year after year, no matter which government has been in place, by the officials, for whom I have a very high regard, in Finance. I want to be on the record as saying that the figures speak for themselves, that the forecasted deficit for the year is almost $58 million, and it is something that the side opposite should be ashamed of, and something about which every Yukoner has cause for concern.

We, on this side, are doing everything we can to turn things around. People in the Yukon do not have to be worried about their bank account any longer. This side is not going to rob the piggy bank; this side is not going to withdraw the savings; this side is going to provide prudent government, reasonable budgets and, we hope, provide a stern hand at the helm, one that will ensure that this ship carries on in future, without worrying about the rocky shoals that so attracted the Members opposite when they were in government.

Mr. Harding: It pleases me to follow the Member opposite in this debate on the supplementary estimates, and I thank the Member opposite for his navigation course. I think it will be very helpful for when we take over the helm of the ship.

I want to say a few words in rebuttal to the Member opposite’s comments, particularly his comments about the Ministers signing off and committing to over expenditures. I want to say to the Minister that, very often, inflated proposals will be received from departments, perhaps with more expenditures in them than are justified. The reason for this is that Ministers feel very strongly that the work they are doing is important to the people of the Yukon and their constituencies, and they recognize full well that, at some point, the expenditures will be the subject of much debate with their other colleagues, who have similar agendas.

The bottom line is that, in five out of the seven years the NDP was in power, they managed to have those debates and come up with balanced budgets. That is very important because, somehow, the Members opposite have the impression that, when you sit down at the beginning of the year and set the agenda, nothing comes up during the year that would have any influence over what those numbers are going to be throughout the year. As they become more experienced in government - I have never been in government but I do have some idea of how it works - they will realize that, every year, they will have to make tough decisions throughout the year, right up until the last day of the fiscal year.

Critical but tough choices force change on projections. It is as simple as that. The Member opposite made a rhetorical comment about the NDP government, the previous administration, going downhill rapidly. I urge the Member opposite to take a look in the mirror. I believe we see exactly the same on the other side of the House. Already, we see a government devoid of ideas. They play the blame game, and I think it is going to become more and more apparent as their term continues, for as long as it continues.

The NDP knew things were tight and they knew there were significant financial restraints upon them.

The previous government knew what their O&M and capital budgets were. That is why they did not make the outrageous election promises the other side made.

I think the point is well-taken that one of the ways to evade having to come through on outrageous election promises is to try and play the blame game. I must admit, with some constituencies they have been doing a fair job of it. I witnessed the MLA’s report by the Government Leader to his riding and I believe he did a pretty good job of playing the blame game. Many people will buy it, many will not.

I really had to laugh at the Member’s comments about turning things around, getting a handle on the ship, getting a handle on things, maneuvering the helm to set a straight course away from the rocky shoals. Boy, they sure got a handle on things.

Since the government has come into power, unemployment has gone from eight percent to 14 percent. Boy, have they really done a job for the people of the Yukon; they really have a handle on things. Income tax revenues are down, social assistance costs are up.

The Member opposite also talked about a review of policy. I have not been in this House very long, but I can tell one thing that I am seeing from the other side very quickly; that is, the Member opposite has a review answer for everything, but I have to caution the Member opposite. Sooner or later the time for reviews will come to an end; the public will demand action and responses and the dance that the Member opposite has been doing will no longer pay the piper. Decisions will have to be made and the debate will be on the basis and the merit of the decision that was made, rather than on the basis and merit of the review that is being undertaken.

I caution the Member that some of the things that are presently under review by the new administration will be discussed in detail.

Yes, the election did pass judgment. The Yukon Party came up with an overwhelming and staggering one percent more in the popular vote. They certainly won big and I hope they keep thinking that way, that they won this by a landslide, because it will certainly make our job a little easier.

Other mines were operating when the NDP came into power. The Member opposite suggests that somehow, as a result of the New Democratic policies - who happen to get two very large mines opened, the Sa Dena Hes at Watson Lake, and the Canamax project - that somehow that was all the NDP’s fault. The previous government also had the Elsa mine opened briefly.

But, somehow the Member would suggest that the public should believe that the reason that they are not operating now, is NDP policies. The Member would suggest that it has nothing to do with the bottoming out of gold and silver prices on the world market. To use the words of the Member opposite, I do not think the public will buy it.

Again and again and again we see no economic leadership. The Members opposite talk about vision, yet they have absolutely no idea of the steps to implement that vision. We do not dispute that you need vision, but you have to have reality. You also have to take steps. You have to have some idea how to implement that vision.

We heard briefly today in Question Period the type of answer we can expect on many of the visionary ideas that this government has had. Many of them have been around for years and years and years. The overwhelming theme that I want to bring to the House today to point out to the people of the Yukon is that six months - half of this year - was their responsibility. It is incredible. I heard the Minister of Tourism and Education facing another protest in the Legislature by students where he was standing there saying, “you should be down there at the NDP headquarters where they spent $57 million more than they took in last year”. This was in March of the same fiscal year and they have been in power for five months. It is absolutely incredible and irresponsible to absolve themselves of responsibility. Right up until the last day of any fiscal year, reallocation of funding has to be undertaken by the government to ensure that the books come up with reasonable figures. But no, months before they even  had any figures completed, they were talking about all the money that was spent. It is clearly an objective to absolve themselves of blame and to absolve themselves of coming up with real policies that are going to benefit the economy of the Yukon, to live up to their outrageous election promises.

Constantly, in the five months that they have been in power in this fiscal year, we have seen the blame game. It never stops - it is the NDP; they spent $57 million more than they took in last year. This comment came from a Minister in the same fiscal year that he is talking about, as if it has ended. We are still in it, and if they cannot organize the numbers, that is their responsibility.

Then we see the government when it comes to mining. On and on, they drone - more mining, more mining - but when the one mine presently operating, the cash cow of Curragh Inc., is suffering, and they cannot get funding from the federal government, the Government Leader stands up and says mining is a federal responsibility. Once again they absolve themselves of responsibility. That is the second aspect of the blame game. Probably the example that illustrates most pathetically their attitude toward leadership, is their attitude with regard to Curragh.

Curragh did not give us enough information; it is Curragh’s fault that we did not reach an agreement in principle; it is Curragh’s fault that we did not put out our conditions before March 10, 1993. Now they bring out a letter that says Curragh would like us not to discuss this in public. I do not know if that was at the Government Leader’s request or Curragh’s - and they cannot discuss the conditions publicly or with elected representatives. Yukon Party supporters - yes.

Why is Curragh dictating to the Government of the Yukon who they should discuss these conditions with? Especially in light of the fact that they were on the radio, taking out full-page ads in the newspaper and doing all kinds of media-darling stuff to sell the political nature of their conditions.

The Members opposite are self-professed, self-fulfulling prophets of doom. Their gloom and doom, sprinkled into the economy, has created a recession.

The Taga Ku project - $30 million in construction work; hospital construction - $49 million in construction work that is not going to be there this year.

They are dragging their heels on Curragh Inc. Yes, we all support efforts to protect the taxpayer in the Yukon, but the dragging of the heels and the negative messages have done much to destroy the economic environment in the Yukon.

They talk at length about what they have done to get a handle on things, but they have not done anything that sends a positive message to stimulate the economy. What tangible results do they have?

I saw a letter to the editor in the Whitehorse Star last week that stated that the protesters, who visited the Legislature recently, should grow up and realize that the recession has hit the Yukon. I agree with the author of that letter.

The recession hit the Yukon on October 19, 1992 - right between the eyes.

Why does the government wonder why revenues are down? Since they have come to power, by getting a handle on things -as they put it - unemployment has gone up from eight percent to 14 percent.

The government asks, why has income tax revenue decreased? When people are not working, they are not paying income tax. When they are not working and they cannot get their unemployment insurance for 12 weeks, they go on social assistance.

The government has done nothing to get their social assistance costs under control. This is irresponsible. The way to sound economic recovery is to get people working, as quickly as possible.

I guess probably the most important aspect of their doom-and-gloom recipe is consumer confidence. If I were a potential buyer of a house in Whitehorse, for example, I would be very leery, with the messages this government has sent out with regard to the economy, about buying a home in the Yukon. I would be afraid to invest in a home, because I would be afraid that they would then let the Curragh mine go down in Faro and Watson Lake. This would have a significant impact on real estate markets.

There are people out there with jobs in the civil service who do not know what is going to happen to them. They are extremely worried when they hear the Members opposite always being negative.

I want to get a little bit into the nuts and bolts of the Yukon Party and what they have or have not done to get a handle on things - get that ship out to sea and away from the reef and all that wonderful stuff.

I have a letter, dated February 1993, from the office of the Government Leader, addressed to, I am sure, a wide mailing list. It is signed by the Government Leader. The letter refers to dealing with the situation. They placed a control on outside-Yukon travel. We do not know who has travelled, where they went or how much they spent. All they said was that travel has dropped by 45 percent. There is no idea what the savings were.

By being penny-wise and pound-foolish, there is also the potential that we will lose millions of dollars in implementation funding, because they did not send the people with the expertise to the talks with the federal government with regard to distribution of implementation funding. We have a real problem there. It is going to get worse. It is very unfortunate for First Nations people and for all Yukoners, because when the feds do not come through, the Yukon taxpayers are going to be asked to foot the bill. It will be a large problem for the Government Leader. I am sure he is aware of that. Sooner or later, push will come to shove, and we are going to be talking about that here in the Legislature.

They placed a control on hiring. I love this one. Numbers were bandied around that they might have saved $200,000 by doing that, but they did not place a control on firing. Unfortunately, when they fired four deputy ministers, the cost to the taxpayers was almost $1 million dollars.

I do not see that as a gain; I see it as a loss of almost $800,000. The exact nature or the amounts of those numbers are going to be discussed in the future. A control on hiring - as a result of their control on hiring and the mixed messages they have sent out, not only have they botched that by costing the taxpayers $800,000 by firing the four deputy ministers; they have also sent messages to people who depend on their jobs in the civil service - auxiliary or temporary or term employees - that have gotten them worried sick and not spending any money. If they do not spend any money because they have no disposable income, it does not go back into the economy; it does not create any spinoff; it does not generate economic activity. It is as simple as that.

Then there was the five percent cut of all politicians’ political support staff and government managers. We supported it. We would like to have some idea of where the money is going to go that we contributed to the equation. We do not have it yet; perhaps it will go to a new lane for the Riverdale bridge or a sewage system for Dawson, or other priorities of this government. They seem to have a lot of priorities in areas where there are MLAs from the governing party.

A new and effective incentive policy is item no. 4 - to better manage government expenditures. How wonderful. Motherhood and apple pie. We are really looking forward to hearing what the nuts and bolts of this one are and then examining the tangible results that come from it.

No. 5: a review is being carried out to streamline government operations, including such things as policies covering government purchases and recruitment of personnel. Result: increased efficiency of government. The people opposite cannot even answer, within three months, a letter that I wrote them. I see no efficiency in that.

Point no. 6: a mechanism is being developed to ensure new government buildings are constructed in a cost-effective way and are modest and efficient in their operations. Result: reduced cost of government. We are really anxious to see what that mechanism is, and we are really anxious to see if it works. I know the previous administration took lots of steps to implement the same kind of mechanisms - some were successful, some were not.

“Preparing for the budget” is the headline on page 3. Every other senior level government in Canada has been borrowing money, but not the Yukon. The NDP thanks them for that compliment.

If we are to avoid deficit financing we have the following choices: reduce expenditures, raise revenues or a combination of both.

I cannot just wait for what is going to happen in the next week, but I expect that the obscene increase in taxes, as described by the Government Leader, is going to come. It may be hidden, but no doubt it will be there. I guess it is not obscene any more now that they are in government and not trying to get elected.

With our options, and I quote “being so limited”, our budget preparations have been challenging to say the least. Every year budget preparations are going to be challenging. Whether you have a $430 million budget or $400 million budget, there are very high expectations in the Yukon.

The reason and philosophy behind the transfer payment from the federal government is that Yukoners should be able to reasonably expect the services that other Canadians receive. That is why the Yukon receives that amount of money from the federal government.

Every year the government is going to have challenging budget decisions. Once again I want to say to the Members opposite, six months of this year were their responsibility. We cannot overlook that fact. I guess if they want to split hairs it could be five months of the budget year.

There is a section about what is happening with the government to fix this alarming situation, as the government refers to it. The government is going to meet with the Deputy Prime Minister, the Hon. Don Mazankowski. I guess this government’s idea of self-sufficiency is having the federal government fund everything for them. Over and over again we are hearing a message coming from both sides of their mouth. It is amazing that a document is given to the Minister of Indian and Northern Affairs, the Deputy Prime Minister, for self-sufficiency: vision, megaprojects.

I would not say that the Members on this side of the House are opposed to the idea of economic activity and stimulus. We would like it to be sustainable for as long as possible, but when we ask the question of the government we would also like them to be able to tell us how they plan to reach and implement that vision.

The Minister for Economic Development - or economic disaster - in his remarks today during Question Period made it painfully clear that he does not really know what they are going to do to get people back to work. What I want to know is what they are going to do today, not seven years from now, to get people back to work. I want to know what this government is going to do to put back to work the six percent of people who have been laid-off or fired since the government took office. Those people need to be put back in the economic equation, because that is the way to economic recovery.

The government is going to meet with the Deputy Prime Minister to discuss proposals aimed at increasing our self-sufficiency through infrastructure-driven investment. That is nothing new; we will applaud them on that proposal. The government should do that; the NDP did much of that as well; for instance, the Alaska Highway deal.

Mining exploration in the Yukon is expected to double this year; that is wonderful. It is our claim that most of that mining activity was planned under the previous administration, but anyway the bottom line is the benefit of the taxpayer, the Yukon, Yukoners and the economy so we are not going to split hairs and argue about that; we think it is wonderful. We are going to be asking questions about the specific steps undertaken to come up with those numbers, and I think it will become apparent that the government really did not do anything.

No. 4 reads that the mining industry throughout western Canada knows the Government of Yukon has changed and that we are now open for business. Yes, sireee Bob. The Government of Yukon now has hospitality suites in Vancouver and gives away free booze to mining people. They are open for business. We do not think you need to have expensive hospitality suites to encourage business, as the Minister for Economic Development did at a conference he attended, walking around saying the Yukon is open for business. The Minister for Economic Development put on a name tag and when people walked up to him and asked him about the Yukon he told them the Yukon is open for business.

I think that is wonderful and admirable, but I do not know what those tangible concepts of being open for business do for generating mining activity. I do not know what free booze does for generating mining activity.

I think the point is that over and over we have received from this government an airy fairy - void of nuts and bolts - mixture of implementation ideas from this government - smoke and mirrors.

Sooner or later, the Yukon people are going to demand that the smoke and mirrors dissipate and we get to the crux of the matter. The hard reality of it is unemployment going from eight to 14 percent. They can talk all they want about this wonderful letter. I wonder if the people in my riding, and some of the other people who do not have a job any more, are thrilled about this letter and what has been done for them. I do not think so; it is propaganda.

On the travel freeze, we are going to be anxious to see how much we spent flying B.C. Vander Zalm’s failed Socreds back and forth. How much travel time was spent on Merv Miller, Dale Drown - the B.C. Vander Zalm Socreds, who came to run the territory? The hit squad cooked up all kinds of wonderful stuff to politically remove from the new government the responsibility that they have to the Yukon taxpayers and people.

The one thing that most tangibly illustrates the ineptitude of their ability to deal with this situation and show any leadership is the hiring freeze versus the firing freeze. They put a hiring freeze into place and, as the Member for McIntyre-Takhini pointed out a couple of months ago, the government had increased in size. They put in the new hiring freeze and then fired four deputy ministers, which cost the taxpayers probably $800,000. There were no savings there.

They managed to find money for an expensive wolf-kill. We do not know how expensive it was yet. We supported it, based on the biology that was presented to us. Unfortunately, the number of wolves was not accurate. Nonetheless, they found the money for that - hundreds of thousands of dollars - by magically reallocating funds, something they are going to have to do every year.

The gloom and doom is an unfair and cruel political tactic. On April 1 of this year, this government will receive and will be able to spend revenues for the territory in the magnitude of $430 million. It might decrease as a result of their policies, which have raised unemployment six percent, but they did get another $10 million from Don Mazankowski, and I am sure they will be putting that to good use. It is important to the taxpayers of the Yukon.

If they look at themselves in the mirror and rationalize what they have been saying, and care more about principle than politics, they will be able to say: we should get down to business.

We should get down to the business of governing for the people of the Yukon. We should start consulting with the people of the Yukon, because we did not really win an overwhelming majority in the last election. This was not a carte blanche, give it all to the new government by the Yukon voters. They eked in on a plan that had a lot of smoke and mirrors, because people wanted to hope for these things. But sooner or later, they are going to be asked to produce and when they are asked to produce that is when push is going to come to shove with the Yukon population, the Yukon people and the Yukon voters. I think that is when it is going to become readily apparent that they did not come to the fight with their gloves on; they came to the fight with their hands tied behind their backs.

They talk about surpluses in bank accounts. Well, there has been a surplus in the territory for years and years and years under the NDP. When the final results are given by the Auditor General, probably in the fall of this year, there will continue to be a surplus, unless they continue to do the kinds of things for the rest of this fiscal year that they have for five months, which is nothing. The revenues continue to decrease and the expenditures continue to increase. A six percent increase in unemployment is not cheap. There is a major cost to that. Unfortunately, the Members opposite have not realized that.

The supplementary estimates are projections. It is incumbent upon anyone who is in government, especially one who holds ownership for five months of the previous year, to take a look at what has been spent and to do tangible, concrete things to try to reallocate the money so the budget balances at the end of the year - to make tough choices. On some things we will spend less; on some we will spend more. Social assistance I am sure has cost this government a lot more because unemployment has risen six percent under their leadership, or lack of.

The forecast that was the political document created by the Yukon Party government when they came into power was fatally flawed, yet they have continued to pump it. They pump their political lines about the NDP spending $57 million more last year than they took in, even though they were in power for five months of the fiscal year. Even during the same fiscal year they are saying the NDP spent, as if it was some time way back when, but they keep bringing it out.

The Yukon public is going to get very tired of that. We have seen that with other governments. Lots of governments in the country have inherited situations and made claims that the situation is very bad, but people do not listen to that for very long. They listen for a few months and give it some credence, but after a while they feel enough is enough and expect action. They expect the government to stand on its own feet and come up with some programs and policies that serve to drive the economy and get people back to work. While we continue this exercise for the supplementary estimates, some people out there will give it some credence, but it will be short lived.

I told the Government Leader the other day that there is short-term political gain for long-term political pain. The economy is the same as the Curragh situation. The two are intricately related. The conditions they set on Curragh may be publicly acceptable and popular, but the bottom line is that they are given the responsibility by the Yukon voter for doing whatever it takes to create a strong economy, regardless of their philosophical beliefs.

We poke holes through the self-sufficiency document, which, incidentally, had some vision, but is totally devoid of steps to get there. They had the bird in the hand with the Taga Ku convention centre, which is one of the items in the self-sufficiency document, yet they do not have the vision to act on it. We are really going to be anxious to see how they fulfill the convention centre aspect of the document. We have some feelings about how they will do it, but it will be interesting for the Yukon people to see it.

I want to go back to the forecast that was so fatally flawed. The supplementary estimates are, in fact, projections that have to be controlled and would have been controlled by the NDP administration, as well. They will have to be controlled by this Yukon Party/Independent administration that has been in power for five months, that has seen to increase unemployment by six percent and increase social assistance costs, decrease revenue that came from Yukoners and get us away from transfer payments from the federal government and build self-sufficiency.

The document included wish lists of bureaucratic departments, that were made time and time again to the Ministers over the NDP’s seven years in power. They were wish lists that were continually denied by the NDP Ministers in government. As the Member for McIntyre-Takhini put it, they were bought hook, line and sinker by the new Ministers, perhaps due to their inexperience or because they did not give a heck.

Maybe it has served their political purposes for blaming the NDP, but I do not think it will work over the long run. The Members opposite, or at least one of them, have admitted to their limited expertise, but one does not have to be an expert in anything to live by principle rather than politics. This is what this debate is all about. This is what the supplementary estimates are all about. This is the political nature of what they have been saying in the media. They have been telling people that, rather than taking responsibility and grabbing the bull by the horns, that it is all the NDP’s fault that they have absolved themselves from the fiscal year, of which they were responsible for five months - one of the months is sort of neutral because of the election. They have not even taken any really tangible steps, other than phony hiring freezes and phony travel freezes, to correct the situation. As a matter of fact, they have made it worse by increasing unemployment six percent, paying out more in social assistance and having income tax revenues decrease.

Their big brother, the federal government, will probably bail them out with a transfer payment formula, probably on the income tax; but nonetheless that does nothing for us in regard to self-sufficiency - absolutely nothing.

Recoveries from the federal government should be in the documents, but they are not accounted for: millions and millions of dollars. Every year, some programs spend more than are allocated; some spend less. Reallocating has to occur just as the government did they wanted to, which was for the wolf kill. Amazingly, out of the blue, out of this bleak, bleak, dismal financial picture, out of the ashes came $500,000. Where did it come from? As the Minister for Renewable Resources put it, “We will reallocate it - we cut out another thing for Faro, we came up with some money and we did some other things in the Renewable Resources department.” I cannot remember them now, but I do remember the Faro thing because it was another “no” for Faro that I have heard from this government.

They came up with a political attempt, albeit in some cases successful, to create doom and gloom, to absolve themselves of responsibility. The supplemental estimates are just that; they are estimates of what will be spent. If there is a problem, the government of the day should be dealing with it. The government that has been in power across the floor for five months of this fiscal year should be dealing with it - not in phony baloney terms; not by firing four deputy ministers and costing the taxpayers a million dollars. Talk about waste and inefficiency, had those ministers been fired for just cause, the contracts would not have had to be paid out.

The NDP did get rid of some deputy ministers, but why - just cause? Yes, it was a just cause.

Some Hon. Member: (Inaudible)

Mr. Harding: The Members opposite find that entertaining, but when one deputy minister is at a political election rally and seen with a Yukon Progressive Conservative hat on, that constitutes just cause.

One of the most important factors we have to look at is what has neen done concretely. Have they concretely improved the situation, or is there a lot of phony-baloney rhetoric ...

Speaker: The Member has one minute to conclude his remarks.

Mr. Harding: Have they taken tangible steps? They fired four deputy ministers, which cost the taxpayers $1 million. They posed a hiring freeze, which destroyed consumer confidence, which kept people from spending money, which, by their estimation, saved $200,000. That is a net loss of $800,000. I do not see how that translates into an improved picture for the economy. I do not see how that translates into tough fiscal management. I do not see how a six percent increase in unemployment since they came into power translates into an improved fiscal picture or economic recovery, in any way, shape or form. I do not see how the rise in social assistance costs translates into an improved economic picture.

This government should get down to work and stop looking for scapegoats. The people of the Yukon deserve it.

Hon. Mr. Fisher: For someone who keeps reminding this House the he has a commerce degree, I wonder if the Member for Faro possibly had a minor in theatrics or drama, or perhaps he watched too much Codco or Kids in the Hall.

The Member opposite did comment that, although he admitted that he has not had much to do with government, he does understand the government system. He must be very naive as government, especially in the north, spends most of their capital dollars well before the fall season, or November, when this government took office.

Before November, the capital monies that were voted in the budget were spent, or committed, for the rest of the year. You might get one year where there is a heavy snowfall, or there may be floods, but the O&M budget is more or less standard. We spend about $35 million a month. It does not change that much. The amount that changes is the capital budget.

The Member for Faro was berating our government for not doing something about the expenditures when we took office in November. The fact is that the money was already either spent or committed.

When the Member points out that we should have started slashing capital projects, looking into the O&M, and so on, right away, it is interesting to note that the previous government voted a $19 million deficit for the 1992-93 year. That is confirmed. They then projected an additional $38,625,000, for a total of nearly $58 million.

I think that everyone here should keep that in mind, that they started out by projecting, or by voting, over a $19 million deficit, and then, in fact, spent an additional $38 million.

I can hardly believe that the Member for McIntyre-Takhini would suggest that the supplementary forecasts are suspect, given that, at least on the capital side, the monies had already largely been spent prior to our taking office. Contracts were signed, construction was either completed or in progress. I just wonder how the Members opposite would be dealing with the annual and accumulated surplus if the Yukon electorate would not have believed that the NDP - and I am just quoting some of the comments that I heard - were indeed “out of control; ”spending like drunken sailors", et cetera, et cetera. What would have happened if they had not been turfed out of office? Where would the Yukon government be today?

The Member for McIntyre-Takhini went on at length about the Consulting and Audit Canada report, which, in all respects, follows very closely the actual supplementary estimates we have before us today. However, the same Member has said many times that the departments have not told the truth, and the Finance department always exaggerates. He has placed blame on those guys, the Finance department, the Yukon Party, Consulting and Audit Canada, the deputy ministers. Do deputy ministers build their favourite projects?

He pointed at everybody, up in the gallery - those guys. Years ago when I learned to shoot a rifle, I became quite adept at hitting a stationary target. When I graduated to actually hunting small game, I found my marksmanship was somewhat lacking. It quickly became apparent that it is much more difficult to hit a moving target. The Member for McIntyre-Takhini has tried very hard to ensure that the previous government is indeed a moving target. In fact, he has attempted, quite eloquently, to shift that target to anything else that moves or does not move.

The public has been aware of the fiscal mismanagement of the previous government for some time, and they reflected their displeasure at the election in October.

Just in closing, I would like to point out, once again, that the previous government had voted an over $19 million deficit and had spent an additional $38 million.

Mrs. Firth: I am going to go on at some length this afternoon. I am titling my presentation after a comment the Minister of Justice used this afternoon. It is called, “The Numbers Speak for Themselves.”

I want to start out by telling a little story to the Members of the House. I will qualify my expertise first, as everyone seems to be doing that. There are some Members here who may not know that I have Cabinet and budgetary experience. When I was a Minister, we were in some very tough economic times - the six-and-five legislation - with some very tough decisions to make. I feel I have an ability to understand budgets and follow them, on my own, without any help from anyone else, to draw my own conclusions and make my own determinations.

I want to tell a story for the Members, to give them some idea of where I am coming from this afternoon. I am asking the Members to be very generous about my comments, to put aside what personal feelings they have about me, as an individual, and just listen to what I have to say.

This is a story for all new Ministers and new Members of the Legislature to listen to. I know what it is like to be a Minister and to have the chief bureaucrat of your department, the deputy minister, come in and have an exchange with you about a new policy direction you may want to take, or some new initiative you might want to pursue. When we had some very controversial issues regarding school children walking across the highway in Porter Creek, I asked the deputy minister responsible for the Department of Highways to paint a white crosswalk on the highway.

The deputy minister said it could not be done. I said, “What do you mean? Get some white paint, paint the crosswalk over the highway. The children need it, it is a safety measure.”

“No, it cannot be done.”

I asked why it could not be done, and the deputy minister’s response was, “I do not know if I can find the machine; I do not know where the machine is to paint the crosswalk.” I said, “Could you please find the machine and paint the crosswalk?” He gave a big sigh and touched his head. I could tell what was going through his mind, that this was going to be a difficult matter. He said, “It still cannot be done because, when we find the machine, it might be broken.”

By this time, I was becoming a little bit astonished, but I was being patient, and I said, “Find the machine and, if it is broken, fix it.”

There was a big sigh from the deputy minister, a very long sigh, and a very annoyed look on his face. He said to me, “It still cannot be done.” I said, “Why not? Why can it not be done?” “Well”, he said, “you know, if we find that machine and we fix it, it might rain that day. It might rain, and we will not be able to paint the white crosswalk on the highway.”

About that time I was losing my patience, and I said to him, “If you do not paint that crosswalk on the highway” - it was my turn to threaten - “I will be out there tomorrow morning with a bucket of paint, a paintbrush, and the media, and we will put signs up and I will paint the crosswalk on the highway.”

The deputy minister looked at me in total disgust, and he said, “You cannot do that, what would people say?” I said, “Well, it is not of a concern to me what people will say because, when the media is there, I am going to give them your phone number, your name, and all inquiries are going to be directed to you.”

There was a shocked look on his face. He went away. The next day, they found the machine; it was in good working order; it did not rain; and they painted the crosswalk on the highway. It was amazing, absolutely amazing.

I tell that story because I want to make a comparison to another story I have been through, and it has been with the Government Leader.

On supplementary budgets and the budget, it is no secret to any Yukoner who knows what the makeup of this Legislature is that the government is in a minority situation in this House when it comes to voting on budgetary matters. It is no secret to a lot of Yukoners that the Government Leader is going to require some support from some of the Members on this side of the House for that budgetary debate.

My support is being requested. I do not have any difficulty giving that support if the government is doing good things and if requests I make for information are forthcoming. I have not made an unreasonable request. I have asked for the figures that were used to make this supplementary estimate. I know those figures are available. The deputy minister sat in on the briefing and had a stack of figures in his hand. He thumbed through them and referred to them to give me answers to the questions I asked.

When I asked for the information, I was told I could not have it, that it cannot be done. I asked why and was told that it was an onerous task and that the government would have to go to an extraordinary amount of time and work to provide me with those numbers. The numbers are all there in the document that the deputy minister has.

The Government Leader should have told the deputy minister to get rid of the confidential information that he did not want me to have and was contained in that document. All I want are the numbers. I do not want Management Board decisions, who said what or the big secret Cabinet discussions. I just want the numbers.

I pursued the issue and was told that not even the government backbenchers are privy to that kind of line-by-line budget information. They should be privy to it and should be asking for it.

It is my support that is being solicited. I am not a backbencher in that party. I do not have to do what everybody else in that party does. The whole public should have access to that information. It should be available for anyone who wants it.

I am told that I have had a briefing, that everyone has bent over backwards to give me the information and that the Deputy Minister of Finance would answer all my questions. I really did not think that it was appropriate to take up three or four hours of the deputy minister’s time sitting in the Cabinet room and asking him to go through every line of the budget with me.

Perhaps the Government Leader would like to offer that to the deputy minister as an alternative? I am certain that, as an alternative, he would prefer to go through the document he has and cross things out as opposed to sitting with Mrs. Firth in the Cabinet room for five hours going through a line-by-line debate of the whole supplementary estimate. It is not an unreasonable request.

My question is: who is running the show? If the Government Leader really wants my support and wants me to have that information, he should be directing the officials to get it to me as quickly as possible. I can appreciate that they are very busy because, from what I understand, the budget was not ready until Friday or so - they were still busy preparing the budget - but the deputy minister has that information at his fingertips and it would not be an onerous task or take an extraordinary amount of time for me to get it.

Then I am told that I can ask the questions in the House. I can ask to go through all the line-by-line items in the House. I can make a determination of those numbers without having the Minister sit there with his official. Every time I ask a question, the official condenses the information that I am going to be given and says, “Give her this one, this one, this one and this one.” I have been through that routine; I know how it works; I know how the game is played. I want the information and I would like to ask the Government Leader to go back to his Finance officials and say, “She needs the information; we should be providing it for her.” It is not an unreasonable request.

Then we can get the crosswalk painted on the highway.

I have a lot of concerns about the direction this new government is taking and about the way they are handling the supplementary estimates, because I know that what is happening now is going to have some bearing on the quality and the kind of budget that is brought into this Legislature.

The concern I have is, again, who is running the ship, or the show, or whatever we are talking about this afternoon? Who is running the ship?

I have a great deal of concern when I ask a Minister in this House why Yukoners are going to have to pay higher electrical rates. I asked the question for two days in a row, and I got a whole variety of rather bureaucratic answers, with all due respect. The one day that I stand up and ask that Member what they are going to do as an MLA for their people, for the constituents they represent, and what they are going to do as a Member of the Legislative Assembly, the Member is speechless. He told me he did not have all the answers. That gives me a great deal of concern. Who does have all the answers? Who is giving the direction? Is the direction coming from the political level to the bureaucracy, or is the bureaucracy telling the political level what to do? That is a criticism and a concern that has been expressed by party members to me, by people out on the street, by people who have had to come and try to deal with this government.

When politicians - who are supposed to be looking after the people, and representing their constituents - start defending government policy and the government bureaucracy over the wishes of their constituents, and start telling their constituents that they are wrong, in favour of some government policy, then we are all in trouble, as constituents.

That is my greatest concern about the impression that this government is leaving in the way they are dealing with these supplementary budgets. I hear it from people, and nobody over there listens to me. I am quoting people who come to tell me they have gone to the government to make some representation, and nobody listens to them - they do not hear what people are saying to them. They have all the answers.

Also if you ask for information, you cannot get the information. We have requested the social assistance study and have been advised that it is an internal working document. We could not get the social-economic impact study about Curragh; we could not have it because it was a Cabinet document. We received a condensed version of an impact analysis that has already been discussed in this House. That was also listed as a top-secret document.

I want the numbers for the supplementary. I cannot have that either. Public information about government expenditures is also not available. I have not been given one reason why I cannot have that information, to review and analyze it.

I am capable of making my own analysis of the numbers. If the government is so fixed on not giving me the information, I have to wonder why. Why does the government not want me to have the numbers? The government wants my support, yet they do not want me to have these numbers. It does not make sense.

There has to be something in the numbers that makes their projected costs less accurate. I would like to see the numbers that the government has used to arrive at the $120 million capital expenditure. I have not known this government to spend more than $65 to $80 million a year in capital expenditures. Why can they not give me the numbers that show how they arrived at that conclusion?

I know there are a lot of unanswered questions about the numbers in the supplementary budget. Other Members in the House have raised it today about the percentage of savings. What do these percentages transfer into in hard numbers? It is great to say that the hiring freeze saved us $200,000 a month. Does that mean $1 million? Is that for five months, or four months? What do those numbers translate into?

We are going to be getting an adjustment with the grant from Ottawa. I have been tol