Wednesday, April 2, 1997 - 1:30 p.m.
Speaker: I will now call the House to order. We will proceed at this time with prayers.
Speaker: We will proceed with the Order Paper.
Introduction of visitors.
Are there any returns or documents for tabling?
Are there any reports of committees?
Petiton No. 2 - response
Hon. Mr. Keenan: Mr. Speaker, today I have the privilege and the pleasure of responding to Petition No. 2 of the First Session of the Twenty-Ninth Legislative Assembly, as presented by the Hon. Member for Watson Lake on December 17, 1996.
I would like to make the following statements.
This petition was submitted by many people concerned about increases in assessed values of property, mainly in the Whitehorse periphery. The regular reassessment of land and improvements in rural Yukon is a mechanism designed to distribute the tax burden fairly among the different classes of property.
I told the House on December 16th that we would be reviewing impacts of the reassessment increases in the areas assessed last year, prior to the legislated April 15th date for establishing the 1997 property tax rates.
As I've stated, this review would include encouraging people to express their concerns and thoughts on the matter. A series of open houses and briefing sessions were held with the public and local groups. The concerned property owners were sent a letter on January 23rd, which in essence outlined the assessment evaluation process. More importantly, it provided a step-by-step explanation of how to file a complaint if they believe their assessment to be incorrect.
Following the assessment review board process, some assessments were lowered. This government has demonstrated its willingness to take people's concerns into account in settling this year's property tax rates. This government believes in fair and equitable tax rates. Accordingly, we remain committed to no tax increases in tax rates, as we have stated in the election campaign.
As the Yukon taxing authority for properties outside incorporated municipalities, I am pleased to inform the Legislative Assembly that my Cabinet colleagues and I have decided that the 1997 property tax rate will be set to achieve an overall revenue-neutral effect, outside of new lands and buildings not previously assessed.
The tax rates will remain the same as last year, with special consideration given to a new Whitehorse north and south property taxation region.
The result will be a reduction in the effective tax that would otherwise be payable on the three classes of properties, and is as follows: residential/recreational by 23.75 percent less; agricultural by 29 percent less; non-residential by 16 percent less.
This reduction will help to mitigate the impact of the 1996 land reassessment. These percentages have been set to result in an average revenue-neutral result on existing land in the region.
This is comparable to the approach taken by the City of Whitehorse where there was a reassessment and the property values went up. The city is contemplating a reduction in its tax rate.
Land values in the south and north Whitehorse periphery areas have been increased substantially over the last five years. This area is subject to market factors different from those in other areas, due to its nearness to Whitehorse.
Along with substantial increases in full-time occupancy of properties and resulting density pressures, the area has now been designated a separate region for property tax purposes.
During the department's open house consultation process, many members of the public asked what services their property tax is for. They question whether there should be a relationship between the property tax rate and the cost of services provided to the properties being taxed.
Property tax rates have not been adjusted in many years, although new services and facilities have been provided, and the cost of providing these services has increased. It is time to address these inequities by having an informed, public discussion.
This year the Department of Community and Transportation Services will begin to consult with rural residents to get their input on ideas that relate the level of property taxation with the level of services provided. Not all neighbourhoods or communities have the same levels of local services to their properties, and many different opinions exist on what constitutes a basic level of service and on what services should be provided.
Over the next year, the department will undertake a two-stage consultation process. First, we will be seeking the views of Yukoners outside municipalities on desirable levels of local services and how these services should be funded. A draft "rural services" policy will be prepared taking into account what was heard during the first stage of public consultation. Then, public input will be sought on a draft policy. Once this work has been completed, the property tax adjustment will be reconsidered.
Mr. Speaker, I believe this will provide a solid basis for making decisions in the future that consider the lifestyles, the wants and needs of rural people, and are based on their input. Our objective is a policy that is based on equity and fairness that will enable us to set tax rates that reflect the level of services to property.
Thank you, Mr. Speaker.
Speaker: Are there any bills to be introduced?
Are there any notices of motion?
Are there any statements by ministers?
RCMP/Department of Justice: shared leadership vision statement
Hon. Ms. Moorcroft: Thank you, Mr. Speaker.
I rise today to inform members of this year's policing vision for the territory. The Yukon is the only jurisdiction in Canada where the government, as a contracting partner, participates with the RCMP in developing a directional statement to RCMP members.
The Shared Leadership Vision Statement 1997 places a high priority on building community partnership and encouraging public participation in the delivery of the policing service. This is the second time such a statement has been created and it is a very worthwhile exercise that I hope will be continued.
RCMP strategies to expand community policing include multi-disciplinary partnerships, First Nation policing, family group conferencing and supporting crime prevention efforts. It is my belief that the police must listen to the community and be responsive to their concerns. This means both traditional investigation of complaints and preventive kinds of community policing activities. I welcome the strong commitment by the RCMP to expanding the focus of their community policing initiatives.
I have travelled to a number of communities and have seen how committed and dedicated RCMP officers are in the performance of their duties. I look forward to visiting more of the detachments in rural Yukon where members make a contribution, not just to their job, but their community. RCMP officers speak to students in the schools and volunteer with youth sports activities. They deserve public recognition of these efforts.
We are making progress in community policing, community justice, involvement with youth, and the expansion of victim services to several communities. It is very clear to me that RCMP members believe in the community policing philosophy. They are building increased trust and confidence in our police force as they actively participate in meaningful approaches to delivery of police services in response to community concerns.
As the Shared Leadership Vision Statement 1997 points out, one of the most effective community policing strategies is to increase public involvement. Last night, the media were introduced to several community volunteers, members of the Whitehorse community policing pilot project, who are working with the RCMP to help resolve such problems as bush parties and property crime. This group consists of 14 people representing diverse interests and groups in the Whitehorse area.
Our government also recognizes the valuable work of the auxiliary policing program. I have asked the department to begin work developing options for what the Yukon can do to address current concerns. This work will include a review of how other jurisdictions provide a legislative basis for their auxiliary policing programs.
I want to thank Commanding Officer Tom Egglestone for the opportunity to work with him in developing our shared leadership vision statement. I am confident that, in cooperation with community members, the RCMP will continue to meet the challenges facing them and will adopt commonsense approaches to achieve our common vision of safe homes, streets and communities.
Thank you, Mr. Speaker.
Mr. Phillips: Thank you, Mr. Speaker. I'm pleased to see that the Minister of Justice is following the lead set by the previous Yukon Party government. A directional statement was a good idea in the past, and I'm pleased to see that the new government thinks it's a good idea now. It's difficult to criticize something that we initiated in the first place, and as long as the government stays on track, they will receive our support in these programs.
I'd like to commend Commanding Officer Tom Egglestone and his staff, and officials in the Department of Justice, for their efforts in delivering these community policing initiatives.
Thank you, Mr. Speaker.
Mr. Cable: Thanks, Mr. Speaker. I had the opportunity to review the first shared leadership vision statement, which this one follows, and I had formed the impression that the shared leadership vision statement was really a statement by the RCM Police that policing is too important a matter for the community simply to hand off to the police alone. Now the best police force in the world, which many think the RCMP is, cannot deal with crime and justice and community problems unless it has the backing of its employers, the members of the community. An involvement of this committee that was formed is a positive step toward obtaining that backing.
Now I had the pleasure last night of attending the meeting that the minister was at and meeting some of the people on the committee, and talking to them, and was struck by the diversity of the people that have come forward to work with the police. These people are to be complimented for stepping forward.
The committee's participation will ensure public ownership of the community policing process. The committee will also assist in identifying and prioritizing community concerns.
I should also comment that the review of the auxiliary policing program and the review of the legislative backdrop for the auxiliary police is a positive step.
Hon. Ms. Moorcroft: I would just like to thank the members opposite for their support of - not of our work necessarily, because that might be a little more difficult for them, but - the good work of our departmental officials and of the police and certainly the community volunteers, because the community policing initiative cannot be successful if it is resting solely on the police force itself.
It is heartwarming to see so many people from the Whitehorse area and the communities who are willing to get involved in the community policing efforts.
Speaker: Are there any other statements by ministers?
Activities of Yukon Hire Commission
Mr. Hardy: I rise today to inform the House on the work of the Yukon Hire Commission.
The role of the Yukon Hire Commission is to develop new policy to ensure that Yukon people have first crack at jobs in the communities and make sure Yukon businesses get their fair share of government contracts. We will be recommending long-term policies, regulations and new legislation to ensure that Yukoners get maximum benefit from government spending.
These new policies will use government spending power to contribute to the development and diversification of the Yukon economy. In other words, we will spend the little we have with more intelligence than has been the pattern in the past.
We do believe that government has a role to play in fostering economic development. We need to ensure that the Yukon government's spending creates as many jobs as possible. We are also well aware of the diminishing resources of the Yukon government, so we need to spend smarter.
Our first step in spending more intelligently is to get a better grasp on what the real problems are and what the potential solutions could look like, so we went out and asked Yukoners what the issues and the problems are and what they saw as potential solutions.
The Yukon Hire Commission is listening to what Yukon people of every walk of life have to say - construction workers, truckers, artists, computer technicians and lawyers, engineers, consultants, businesspeople in practically every industry operating in the Yukon, the public servants, the First Nation governments, municipalities, unions and business organizations.
So far the commission has been to Old Crow, to the northern highway communities of Beaver Creek, Burwash Landing, Destruction Bay, Haines Junctions and also to Carmacks and Carcross. Trips are planned in the very near future to Watson Lake, Ross River, Faro, Pelly Crossing, Mayo and Dawson City.
We're also conducting research. We're reviewing local hire and local purchasing provisions in the Yukon and other jurisdictions to see what has worked and what hasn't worked and why. We're also analyzing government data on contracting, purchasing and contribution agreements to pinpoint where the problem areas lie. The results of this work will be published in early June. We will then produce a discussion paper that will outline the issues and the proposed solutions. After that, we begin a second stage in consultation to develop a policy with all the people affected by these decisions.
Although our initial consultations are incomplete, certain common themes have been emerging. There are serious concerns with government planning, especially around budget timing. We heard this concern not only from the businesses and working people, but also from the civil servants who are frustrated with the current system.
Many businesses feel the tables are tilted in favour of firms from outside the Yukon, either because of the ways specifications or requests for proposals are drawn up or because of the timing of the projects. We need to take a close look at our tendering practices. In an era of shrinking government budgets, the government needs to get the biggest bang for its buck. A short-sighted approach to the lowest bids can have a serious negative effect on government finances.
A number of studies have shown that the low bids without wage and employment regulations have actually resulted in higher costs to government because of cost overruns, loss of tax revenue, encouragement of the underground economy and consequent tax losses, more work accidents, higher work and compensation costs and lower quality of work from using an untrained and often an unskilled, unqualified labour force.
What we need to consider is the overall government bottom line and the global effect of government spending on the economy and on our communities.
There is a need for a better and expanded training programs, especially training programs suited to the rural communities. As one result of what we heard, the Department of Education will be putting in place new modular training programs in Old Crow to ensure that residents of that community will have the skills needed to access jobs resulting from the construction of teacher housing and of the new school.
The Yukon Hire Commission will also be cooperating with other departments to develop a training strategy for the Yukon to ensure that Yukon people have the skills they need to get meaningful employment.
We need to make sure that local people get first crack at jobs and government contracts. Workers in the Yukon are frustrated by a lack of job opportunities, especially when they see jobs that could be done going to outside workers. We need to look carefully at our options and develop a made-in-Yukon policy that will result in the largest number of Yukoners getting work. This is the task we have set for ourselves, and we are well on our way.
Thank you, Mr. Speaker.
Mr. Ostashek: Thank you, Mr. Speaker.
It is somewhat ironic to hear the member stand up and try to build some credibility for his local hire commission as he says to ensure Yukon people have first cracks at jobs. It's somewhat ironic to see him do that after his leader has made a complete mockery of the local hire policy that he's trying to implement and this by his ham-handed decimation of the Land Claims Secretariat and removing some very competent people and replacing them with bureaucrats from a NDP regime in British Columbia. I think it sort of makes a mockery of the local hire commission.
Nevertheless, Mr. Speaker, I am glad to see the government is starting to realize that they do have a role to play in fostering economic development in the territory. That is something new for this administration, and I'm glad to see them admit it.
There is absolutely nothing new in what the member has relayed to this Legislature. My understanding was that we were going to get new initiatives, new direction, and that we would be informed of that. This is just a rehash of anything that has been said in the past.
It appears to me that the NDP, during the last election campaign, set up a straw man with this local hire issue and now they don't know how to deliver on it.
I would like to ask the member if he would be prepared to table a report in this Legislature on his consultations in the communities, along with the number of people that attended these consultations and a transcript of what was said. Will the member do that? He can tell us in his rebuttal.
Ms. Duncan: The Cabinet commissioner has offered an interesting, if somewhat incomplete, report to this House.
I took the opportunity to review Hansard, the last time we took the opportunity to discuss local hire.
At that time I repeatedly requested that the ways of work of the local hire commission be made clear. To some degree, this has been done. We know that the commission has made, or is making, a number of trips to Yukon communities and that they are reviewing local hire and local purchasing provisions in the Yukon.
The commissioner took my previous remarks to heart about developing a white paper, and I'm pleased that there will be a consolidation of the work and that a discussion paper will be coming out.
I suppose at that time the commissioner intends to take the Minister of Economic Development's suggestion and consult with the Opposition on this.
I found the common themes rather interesting, particularly point number 1: serious concerns around budget timing. Gee, that could have largely been resolved if the government and the members opposite had taken seriously, and really thought about, the suggestion of fixed sitting dates for this Legislature.
For example, if the public knows that the session will start on the second Wednesday in February, as it does in the NWT, you can be fairly certain that the budget will be announced shortly after that. Or, an announcement of when the budget will be made will come shortly after that.
The common theme of tendering practices - well, all of us heard that during the election campaign.
As the former manager of the Whitehorse Chamber of Commerce, I can tell you that the previous Government of Yukon tinkered with contract regulations and the previous Government of Yukon prior to that tinkered with contract regulations, and there was absolutely no doubt in my mind that whoever was seated opposite after September 30th would be tinkering with the contract regulations.
That being said, I wouldn't recommend that there be a huge stop sign and that we quit tinkering with these contract regulations. I would, however, use the term, "Caution, it's a slippery slope."
Yes, they could use some fine tuning, but be very, very careful. Every industry and every business situation in the Yukon is different, and writing one rule to apply to everyone is very difficult, if it's possible.
I applaud the commissioner's statement that what we need to consider is the overall government bottom line and the global effect of government spending on the economy and on our communities. That's right. That's why we in the effective Opposition scrutinize the budget so very, very carefully.
The commissioner also took to heart my comments on our last debate that local hire is about far more than government spending. It's about education. I am pleased that there are several education initiatives noted.
The commissioner did not hear all my remarks, or he didn't review Hansard prior to this progress report, as he seemed to focus on the role of government and neglected some of the creative ways government could also encourage local hire. Local purchase is local hire. The Government of Yukon is the largest single employer in this territory. What are you doing to encourage your employees to shop locally? I must have said this at least twice in this Legislature, that this has been a suggestion that has been out there since 1991 - six years. Surely, somebody could work out a creative way to work with YGEU to encourage local purchasing. Local purchasing means that you have to have the goods, you have to have the workforce, you have to have the price. It means working with the business community, and I'm looking forward to the local hire commissioner's progress report on this aspect of the local hire issue.
Speaker: Order. The Member has one minute remaining to wrap up her remarks.
Ms. Duncan: Thank you, Mr. Speaker.
Overall, I would like to thank the local hire commissioner for this progress report. Although he has ignored a number of obvious suggestions and, in a number of cases, restated long-held Yukon beliefs, we still don't have a definition of local hire. However, on the whole it's not a bad start.
Mr. Hardy: Actually, Mr. Speaker, it is really wonderful to hear the tremendous endorsement I am receiving from the other side. I believe it was well-heard during the election campaign and I believe the members opposite also believe that the work we are doing over was a long time in coming and are endorsing it, and it pleases me to hear such praise.
I'd like to just do a little history. It kind of falls in with the feeling that seems to be floating around here with this endorsement and agreement on the work that we're doing.
Back in 1986, there was a motion brought on the floor by the Official Opposition, which was the Yukon Party, or its predecessor name I think at that time, Progressive Conservative. Yes, Progressive Conservative, okay. Anyways, it was the hon. Member, Mr. Phelps. I will read his statement and it shows you the long-standing problem we faced in the Yukon and the difficulty in trying to come up with a local hire policy that will benefit people of the Yukon.
The motion was ... this a longstanding problem that has become, once again, very topical in recent days. The issue of local hire and the complaint that Yukon workers watch southern contractors bring their own workforce with them from outside the territory, where there are major government projects. It goes on to talk a little more, and he feels that the problem facing Yukon workers would be solved if the government would examine and develop a policy that would include a provision that for government contracts in the construction of buildings and large projects, the contractors be faced with the condition that they only hire people at established offices in the Yukon. It's local hiring halls, the kind of way he was talking about, and I felt that was real progressive, so it kind of helped with the name "progressive conservative".
The nice thing about this was a motion from the Opposition, and it was endorsed by the government of the day, which was an NDP government, and agreed to by every person that it's a major problem that has to be dealt with, and there was high unemployment at that time as well. Interesting enough, the two people that were talking back and forth to each other are both lawyers and agreed that a Charter challenge was something that they would deal with when it came along. So, no one brought that up today, but that's something that we're also approaching as well.
The comments by the Member for Porter Creek North - we're developing policy, we're not implementing policy at the moment. So we're in the process right now of consultation, and we are going to consult with as many people throughout the Yukon as possible who want to participate in this. The door is open for people to participate, and we're going out into the communities to ensure that they do have a say. We don't believe consultation is rehashing ideas. We believe it's finding solutions.
I thank the comments from the Member for Porter Creek South. She likes the word "take it to heart". I do take to heart what she said, and I hope that she works in a progressive manner with us as we try to resolve some of these issues.
The government does have an opportunity to set an example - the example of training and employment and benefits to the Yukon people - and we hope the example that we set will be copied by the private sector, and then all people in the Yukon will have a chance to prosper and the youth will have a chance to work and seniors will have a place to retire in dignity.
Thank you, Mr. Speaker.
Speaker: This then brings us to Question Period.
Question re: Yukon Energy Corporation, sale of assets
Mr. Ostashek: Now that it is abundantly clear to Yukoners that they can no longer believe anything that the present government said when they were in Opposition or during the election campaign, my question is to the minister responsible for the privatization of YEC's assets.
The minister said in this House yesterday...
Speaker: Order. I must ask the member to refer to the minister in his appropriate portfolio.
Mr. Ostashek: The minister of energy. He is still the minister responsible for privatization, Mr. Speaker.
The fact remains, Mr. Speaker, that the minister stood in this Legislature yesterday and said in a ministerial statement that this new arrangement was going to be an overall savings of $2 million for Yukoners over a five-year period.
I would like to ask the minister if he could stand up in the House today and explain to this Legislature and Yukoners where this saving is going to be realized.
Hon. Mr. Harding: Thank you, Mr. Speaker. I want to respond to the preamble to the member's question first. Firstly, Mr. Speaker, the rationalization that has been a small element of this proposed deal by the Yukon Energy Corporation Board of Directors presents some very good opportunities for Yukon people. It affects less than three percent of YEC's assets and it is a neutral asset transaction - it is simply a transfer of assets from distribution to generation. It does not affect the asset base of the corporation. Of course, that money will be invested in new asset infrastructure, in a very targeted way, to improve Yukoners' stead in the energy field. It also allows us to pursue direct management with greater economies of scale for the future. And, of course, it has the ultimate protection, for Yukoners who want to re-evaluate the deal, of a buy-back option at the end of five years.
This deal saves $2 million for the ratepayers of the Yukon over the next five years. Those savings will be obtained through a reduction in fees by YECL and also the provision of our own insurance to the Energy Corporation as opposed to the Alberta Power.
Mr. Ostashek: Mr. Speaker, regardless of how the minister wants to wrap weasel words around this, the fact is the letter that was written to me by the now-Government Leader on August 8th says, "We will continue to believe that the disposal of public assets to a privately owned company, particularly one based outside the territory, is not in the best interest of Yukon people."
That is exactly the position that the government took. The minister said that he is going to realize $2 million in savings on the management agreement when, in fact, in a briefing this morning we were told the only hard costs that we know of in the management agreements is a flat fee of $75,000, plus about $300,000 in costs. That's an arbitrary figure that's based on a best-effort calculation basis.
Mr. Speaker, the point here is, while the minister may be trying to realize those profits there, he is in fact giving up $2 million in return on investment by privatizing $4 million worth of assets. He's privatized $4 million worth of assets on which the Yukon Energy Corporation will not be getting a return. How does this relate to savings? The best the minister could say to the people today is it's a wash.
Hon. Mr. Harding: Thank you, Mr. Speaker. I regret that the member is once again uninformed. The deal will realize a savings to ratepayers over the five years to a reduction in fees from YECL. They used to charge over $800,000 a year. That's what we're paying this year because the former Government Leader, the member that I'm looking at now, failed to negotiate a new agreement of any kind, which put ratepayers on the hook for another $800,000 this year.
Unfortunately, Mr. Speaker, ratepayers will have to bear the brunt of that. With this new proposed arrangement in principle by the board of directors of the Yukon Energy Corporation, there is a savings of $2 million. The monies that are obtained from the assets - the poles and wires, the $4 million - will be invested in new assets so the same level of assets is maintained.
The Energy Corporation, as I understand it, is looking at those options right now, as is the board of directors. There's also, while that money is in transaction, it can be stored in an appropriate savings vehicle to accumulate interest.
Mr. Ostashek: But unfortunately it is the minister who doesn't understand. The fact remains that in order to save $2 million of the management agreement, he is giving up $2 million to $2.5 million in return on investment of assets that he has disposed of. Yes, the money is going to be reinvested at some point - at some point, not now - but the reality of it is that the corporation is going to have to invest in capital on an ongoing basis. The fact remains that we have given up $2.5 million in return on equity.
Inevitably, the sale of these assets to Alberta Power is going to lead to increased costs to the consumers. I would like the minister to explain to Yukoners what he is going to do to bring the energy bills down in the Yukon.
Hon. Mr. Harding: Thank you, Mr. Speaker.
Mr. Speaker, the member is completely wrong. This deal - this agreement in principle - as it was approved by the Energy Corporation Board, which he appointed - will save ratepayers in the Yukon $2 million over five years in decreased costs in management fees, and in savings that will be attributed to the handling of our own insurance matters.
Secondly, Mr. Speaker, with regard to the options around rationalization, it clearly was a very big part of the options for managing Yukon's power system that the former Government Leader put out in the summer of last year in consideration of this issue. Option number 4 - I've looked through the discussion papers - clearly shows that one of the options that the Government Leader was sponsoring was an option to rationalize assets or diversify ownership of the Yukon Energy Corporation. The facilitator's introductory notes in that public consultations tour say that there is still lots of room - this is according to the former Government Leader - for the consideration of new partnerships and that ownership structure. He goes on to say that the only thing he won't consider is full privatization of the utility as an option, and that is something we backed the Yukon Party government off of because the former Government Leader and the Member for Ross River-Southern Lakes were very much bent on privatizing, wholesalely, the operations of the Yukon Energy Corporation to southern interests.
What we have done, Mr. Speaker, is rationalize transfer assets from distribution to generation for the benefit of Yukoners, which will yield substantial cost savings and allow us to target asset investment in appropriate areas for Yukon ratepayers and Yukon citizens.
Question re: Yukon Energy Corporation, sale of assets
Mr. Ostashek: Thank you, Mr. Speaker. The minister has made quite a speech there, but he didn't answer the question.
The reality of the situation is, Mr. Speaker, we did not go on the public record, like the members opposite, saying that we should not dispose of any assets, and that is exactly what they've done. Now they've made a flip-flop.
In light of their making that flip-flop, if they now have a new vision - which they never shared with the Yukon people - of rationalizing the assets, why didn't they go all the way? Why are they still going to have a convoluted process? Why didn't the demand from Alberta Power that they give up their rights to the McIntyre hydro project? If we're going to rationalize assets, why aren't we doing it wholeheartedly.
Hon. Mr. Harding: The Opposition Leader is quite correct, that they didn't go on the public record with regard to their position on privatization. They gave backroom contracts to people to investigate it. They refused to tell the public, until we pulled it out of them, kicking and screaming, the privatization agenda that was being contemplated by the members opposite.
Mr. Speaker, we have done everything extremely transparently, we are supporting an agreement made by the board of Yukon Energy Corporation, and I invite the Leader of the Official Opposition to take up any concerns he has with Mr. Ernewein, the chair that he appointed to the board of the Yukon Energy Corporation, who supported the deal that was reached by the president of the corporation.
Mr. Speaker, this deal that is being proposed - and there are still some hurdles to go, it has to be finalized at the end of this month - proposes $2 million in savings to ratepayers over five years. It gives more control to Yukoners over the management of the assets. It moves away from that management agreement to more of an operational agreement.
Mr. Speaker, the rationalization only affects three percent of Yukon Energy Corporation's assets and it's a transfer from distribution to generation. It doesn't affect the asset base and allows us to target appropriate expenditures.
There's also, Mr. Speaker, a buy-back clause. At the end of the deal, if Yukon public, the board, or the Yukon government feels strongly that there should be a buy back of those assets, then they have the ability to do that at book value.
Mr. Ostashek: Thank you, Mr. Speaker.
I will concede to the member opposite that that's the only good clause in the agreement, so that a new government, five years from now, can get the Yukon people out of the sorry mess that this government's going to get them into with their actions on the new management agreement. What has happened is Alberta Power has held a gun to their head and said, "Take it or leave it," and this minister hasn't been able to negotiate strongly on behalf of the Yukon people and has caved in.
Mr. Speaker, I ask the minister in my supplementary question: can he tell me what benefit it is going to be to YEC and to Yukoners in having YECL retain 50-percent ownership of the McIntyre Creek hydro project?
Hon. Mr. Harding: Mr. Speaker, the Opposition Leader again is misinformed and erroneous in his comments. There was no gun held to our head. As a matter of fact, we considered the option of direct management, as did, as I understand it, the board of the Energy Corporation, which he appointed. We were only prepared to take a deal that was a good deal for all Yukoners. With regard to the allegation that we haven't been able to negotiate that, I would check his record against ours any day. The former Government Leader was an expert at getting to "no" when it came to negotiations whether it was devolution issues or land claims or the fact that he couldn't do anything other than to extend the contract with YECL for another year. His record is very abysmal on that subject.
Mr. Speaker, we're proud of our deal. It's going to yield savings for Yukon ratepayers. We are proud of the deal that the board has agreed to, and we think it's going to be in the best interests of Yukoners. It's going to give us more control and it does allow us to pursue energy options, such as looking at grid line extensions or substations or microhydro like the McIntyre Creek. There is $4 million that will be realized that will be reinvested into asset infrastructure, so we're quite pleased with it.
Mr. Ostashek: Mr. Speaker, I can just hear that member opposite if, in fact, I would have signed an agreement in front of a general election coming to the territory. In fact, his leader asked me not to, in this letter of August the 8th, and also not to sell any assets. That's what he did.
Mr. Speaker, I would like to ask the minister, in this final supplementary, for once let's get this clear for the people of the Yukon so they know what they're dealing with. Can he explain how the sale of YEC distribution assets in Mayo, Faro and Dawson City is going to reduce Yukoners' high power bills?
Hon. Mr. Harding: Well, Mr. Speaker, the reason we asked the government not to do a deal was because we knew we couldn't trust the direction of the previous government when it came to energy. We knew their agenda was clear. Their agenda was one of privatization to a major degree. We backed them off of wholesale privatization and selling off through the back rooms - the former Member for Ross River-Southern Lakes and the Government Leader giving contracts to their old friends to negotiate deals behind closed doors.
Mr. Speaker, the deal with rationalization that we are recommending be approved on the basis of the board's recommendation is one that we feel would be good for Yukoners. We feel it allows us to stick to the core businesses of generation and transmission. It allows us to invest in acid infrastructure to get us off the continuing push-pull we have with environmental hydro concerns versus diesel consumption and the cost of diesel consumption.
So we feel that it's going to be good in the long term for Yukon ratepayers in that respect. It's also going to be good for Yukon ratepayers, Mr. Speaker, because we managed not to extend the deal for another $800,000, like the former Government Leader. We managed to negotiate fee service reductions, and also to strike some arrangements with regard to insurance that will yield benefits for ratepayers.
Question re: Yukon Energy Corporation, financial position
Mr. Cable: I have some questions for the same minister on the financial position of the Yukon Energy Corporation. I've been going over the various claims that are going to be made on the profits of the Yukon Energy Corporation. What we have is, firstly, $2.5 million in a receivable owed by Anvil Range, and I don't think anybody's entertaining any hopes that that'll be paid in the near future. We have the $1.6 million that the minister has spoken about earlier for his rate relief program. We have the lost revenues from Anvil Range because of the shutdown, and we have the additional diesel costs because of the Aishihik directive. Now, if my math is correct, these add up to somewhere in the order of $14 million to $15 million in claims against the profits.
Now, those profits are generally the order of $7 million to $8 million. Does the minister share the view that the Yukon Energy Corporation is rapidly heading toward insolvency?
Hon. Mr. Harding: Obviously, it is a concern to us - the situation with regard to Anvil Range. On the first point, though, with regard to their overdue accounts, they have indicated to the Energy Corporation that they are prepared to pay them. I understand there have been some preliminary discussions, to be followed by more formal ones, to set out the repayment of overdue bills and to set up that schedule. There are a number of receivables due Anvil Range from concentrate that has been shipped to the Orient - to their market - so they will have some cashflow very shortly.
There has been a miner's lien placed against assets and property assets for the amount that is owed the Energy Corporation. With regard to those lost revenues, the Anvil Range mine only went off the system as of two days ago. My understanding is that they fully intend to work toward a startup as soon as possible. That could be, in terms of the mill, in August.
With regard to the additional costs of the decision not to use the bottom two feet of Aishihik Lake, that did yield some additional costs, but there were revenues in YDC that will be used to offset that. So, along with the fact that there was the rate rider that was approved by the Yukon Party government - the application to go to the courts by YEC back in 1993 - that yielded some more revenues for the corporation.
While the situation is a concern - and I have relayed that concern to the president of the corporation - I do not think that it has reached the stage - nor should it - to declare it insolvent. Mr. Speaker, it is important that the revenues that Anvil Range owes are accumulated by the corporation.
Mr. Cable: It sounds like some "could have beens" and "possibly will be's" on the payment of the Anvil Range receivable and the possible startup of the Anvil Range mining operation.
Is the minister of the view that the disastrous financial position of the Energy Corporation is going to exert significant upward pressure on rates, making the government's election promise to stabilize electricity rates impossible to achieve?
Hon. Mr. Harding: Mr. Speaker, the member is being extremely alarmist. I am not sure exactly what he is getting at. Is he asking us to cancel bill relief? Is he asking us to drain down Aishihik Lake and not make good on election commitments to mitigate the environmental effects there? I am not quite sure what the member is getting at. Is he asking us to take some radical action against Anvil Range when they have had a miner's lien placed on them, when they have committed to a repayment schedule? I am not quite sure what he wants us to do.
Mr. Speaker, with regard to our commitment to stabilize rates, one of the very first acts of this government was to bring in an extended rate relief program - something that the Yukon Party government refused to do. Also, Mr. Speaker, we bear the brunt of a 30-percent increase in world diesel prices - a rate rider that was approved by the Utilities Board - before we ever even came into office. We also faced an increase as a result of a 1993 decision for the YEC to go to court to get costs they felt they were entitled to - that the previous Yukon Party government should have taken action on at that time.
Mr. Cable: Well, I'll tell the minister what I'm asking him to do: recognize the problem before it hits him in the face.
Now the minister had mentioned the $10 million that's sitting in the Yukon Development Corporation, the parent company of the Yukon Energy Corporation, and he's indicated that he may use it to buttress the financial position of the Energy Corporation. Can we get a commitment from the minister to stay away from any financial adventures with this $10 million until the Energy Corporation's financial position has stabilized?
Hon. Mr. Harding: Well, Mr. Speaker, we have clearly indicated from the time we announced the Aishihik decision that Yukon Development Corporation accumulated revenues would be used to offset any additional cost to ratepayers as a result of not using hydro capacity with respect to possible environmental concerns that were identified by the technical advisory group.
So, Mr. Speaker, I will say that we are recognizing it as a potential problem. Obviously, with Anvil Range, the largest customer in the Yukon going off the system, I've asked the Energy Corporation to ensure that they're looking at cutting costs where they can to prepare for the brunt. I've asked them to take whatever legal action they have to to secure the payment of the money that is owed to them. They are in discussions, as I understand it, about energy options with Anvil Range. They're in discussions about a repayment schedule.
Certainly, Mr. Speaker, we have to be assured that we're in control of the situation. We know what the books look like, but there is no need for the member to be alarmed. I can assure him of that.
Question re: Energy policy
Mr. Cable: I have some questions for the energy commissioner on energy policy. The commissioner has been asked to establish a comprehensive energy policy through his Cabinet Commission on Energy. Now, some jurisdictions in Canada are looking at competition in the supply of electricity. Is the commissioner prepared to listen to submissions on, and consider, competition in the supply of electricity?
Mr. McRobb: Thank you very much, Mr. Speaker. It is indeed a pleasure to be the first commissioner to answer a question in this House.
I'm not prepared to sit down just yet. The commission will entertain submissions from any interested parties, Mr. Speaker, on any aspect of developing a comprehensive energy policy. The member opposite refers to what is known as electricity market reform in other parts of the country in North America.
We must keep in mind the Yukon is very unique in several aspects. Number one, we are not part of the main North American electrical grid and we have several factors in the Yukon that are unique to the territory that we must consider before merely adopting practices that are emerging in the south.
Mr. Cable: I thank the commissioner for his first answer.
Now, some jurisdictions in Canada permit municipalities to own and run their own electrical distribution systems, and restoring the right to do this has been pushed, in the past, by the Association of Yukon Communities and by one of the ex-mayors of Dawson, I believe.
Is the commissioner prepared to listen to submissions on municipal involvement in electricity distribution as part of his development of a comprehensive energy policy?
Mr. McRobb: Absolutely, Mr. Speaker, and that opportunity was made quite clear to the president of the Association of Yukon Communities when I met with him as part of our ongoing stakeholder consultation process.
Mr. Cable: Now, the agreement in principle between Yukon Energy Corporation and Yukon Electrical Company Ltd. sets out that a long-term, 20-year franchise will be negotiated with Yukon Electrical Company Ltd. - presumably an exclusive franchise arrangement. This would appear to slam the door shut on competition at the retail level and municipal involvement for at least 20 years.
Is the commissioner of the view that he's now wasting his time on bringing these two issues forward - that is, competition and policies relating to municipal franchising?
Mr. McRobb: Mr. Speaker, I do not see a conflict in what the member opposite raises. There are several aspects to municipal ownership of electrical infrastructure in the territory. As the Member knows from his eight-month stint as president of YEC in 1991, the Public Utilities Act prevents any duplication of electrical services in the communities. There can only be one set of transmission lines and poles. In any case, Yukon Electrical is the major owner of that infrastructure and would have to be dealt with in any event.
Question re: Yukon Energy Corporation, sale of assets
Mr. Jenkins: Thank you, Mr. Speaker. My question today is to the minister responsible for the Yukon Energy Corporation and divesting of the assets of the Yukon Energy Corporation.
In 1987, Yukon was handed a plum with the transfer of the assets of the Northern Canada Power Commission. We were given complete control over our energy future here. The previous NDP government squandered the profits from that cash cow, investing the profits in ill-fated ventures such as the Watson Lake sawmill. The Yukon Party subsequently ensured that the future Energy Corporation profits could only be spent on energy-related projects. But now we have a new government literally selling off the energy infrastructure from this corporation. At the briefing this morning, the financial position of the Energy Corporation was laid out, and it is precarious.
What is the minister going to do to ensure that we have reliable fixed-cost power delivered, so that he can meet his commitments that he has given to this House previously?
Hon. Mr. Harding: Well, Mr. Speaker, I don't know how many times we're going to have to fight the Watson Lake sawmill battle in this Legislature - it seems like thousands and there's been, I don't know, two or three elections since that event - but anyway, if the members want to keep bringing it up they can.
Mr. Speaker, the member for Dawson made a ridiculous allegation that we're selling off the assets, there's been a transfer of assets from distribution to generation. There's a buy-back clause with that at the end of the agreement at book value. We feel that that's a good deal.
One of the ways we'll stabilize rates for ratepayers is through the continued operation of a bill relief program, one that we brought in that the Yukon Party refused to agree to, just last December, Mr. Speaker.
Also, we will continue to do things like reach new arrangements that reduce fees for management, like we just did in this new agreement in principle. We won't keep extending and extending and extending and putting off the tough decisions like the former Government Leader at a cost of over $800,000 a year to ratepayers.
Mr. Jenkins: Thank you, Mr. Speaker. That was a very disjointed answer that goes nowhere. It was no answer.
Can the minister explain how the Yukon Energy Corporation's divesting of its assets is going to give Yukoners more control of our energy future? It simply is not the case. Please explain, Mr. Minister.
Hon. Mr. Harding: First of all, the assertion is wrong that there's a divesting of assets. There's a transfer from distribution to generation. The asset level of the Energy Corporation, the publicly owned, publicly controlled utility, stays the same. There are more strategic asset investments contemplated to help us deal with some of the supply problems that we have in the territory.
Mr. Speaker, we believe that this charts a very solid course for the Yukon and certainly will help us, as a result of this arrangement, cut costs that we were paying for management fees to YECL as a result of the failure of the previous administration to reach a new agreement on this.
Mr. Jenkins: Thank you, Mr. Speaker.
It's obvious, Mr. Speaker, that the minister knows nothing about finance as it relates to energy.
Can the minister explain how the Yukon Energy Corporation's divesting of its assets is going to reduce the cost of electricity for electrical consumers? Let's try another approach.
Hon. Mr. Harding: Mr. Speaker, one of the major ... First, I must take issue again with the preamble and allegations of divesting of assets; there is simply a rationalization of assets here, a transfer from distribution to generation. This will allow us to invest in asset infrastructure in this territory that is more targeted, that will enable us to deal with some of the major supply problems here in the Yukon and the constant trade-off between the use of hydro, which has an environmental impact, as well as diesel, which also has an environmental impact but also has a very, very high cost. So, that's how it will help Yukoners.
The other way, this arrangement with YECL - which has a buy-back clause, as I might add again - that was negotiated by the Yukon Party-appointed board of directors of the Yukon Energy Corporation, Mr. Speaker, is that it will reduce support fees and management fees that were just extended to the cost of ratepayers by the previous government of some $800,000. So, that's another way that it will help reduce rates for Yukon ratepayers and will help to keep us in check.
Another way is through the extension of the bill relief program, which we just did in December, something the previous government would not commit to as well.
Speaker: The time for Question Period has now elapsed, and we will proceed to Orders of the Day.
ORDERS OF THE DAY
MOTIONS OTHER THAN GOVERNMENT MOTIONS
Clerk: Motion No. 52, standing in the name of Mr. Hardy.
Motion No. 52
Speaker: It is moved by the Member for Whitehorse Centre
THAT it is the opinion of this House that:
THAT this House expresses strong disapproval of this neglect of duty, and urges the Federal Government to work with the provinces and territories to stop the offloading and restore funding to essential programs that addresses serious social needs.
Mr. Hardy: Mr. Speaker, I rise to speak in support of this motion. Here in the Yukon we're starting to feel the effects of the federal government policy that is threatening the quality of life of many of us, especially the disadvantaged. It's a multi-faceted policy that goes far beyond the cuts to such important and valuable programs as YES, or the parenting program, Nobody's Perfect. Withdrawal of federal funding from community programs that depend on the financial support and cuts to initiatives for which YTG receives funding, such as French and aboriginal language programs, may be the most visible and distressing signs of the federal Liberal policy, but they represent only a small part of the whole picture.
I want to place these actions in a larger context.
As some Yukoners are beginning to realize, based on local experience, we're entering into a new and perilous arrangement with the federal government with regards to health and social service funding. Mr. Speaker, the relationship between the Canadian government and the provinces and territories is changing in a profound and serious way. I believe many Canadians are still not quite aware of how serious the impact will be further down the road. Never before have we witnessed such a callous dismantling of the social safety net in Canada, putting at grave risk the programs and services which all Canadians are dependent upon, take tremendous pride in and which have served in a major way to define the Canadian national identify, one that is recognized throughout the world and is envied by many countries.
We as Canadians, long ago, came to believe that there are certain areas of common concern that are so important, so vital, to the well-being of Canadians everywhere that strong federal government was needed to deal with them. So the federal government took responsibility for broad areas of social programming and health care, education and UIC. They did this at a time when Canada was divided, when certain areas, provinces, territories, were trying to meet the needs of the people. It was recognized under a federal system that there was going to be a need to have national programs that reached across from coast to coast to coast.
It did this by providing funding assistance to the provinces and territories, and by using that funding power to enact national standards for accessibility and quality of service. Part of the condition was that these national standards would be in place no matter where you lived. This is starting to change, and it's changing fast.
The changes originally started with the Mulroney government. They've been picked up by the Liberal government. It's not a change that's happened within the last year or two years. It's change that's been progressing for the last 10 or 12 years.
They've done this by creating hysteria throughout Canada on the debt and deficit. They've done this by blaming our social programs as a cause of our debt. Unfortunately, many people aren't aware of or appreciate the fundamental threat that these changes are going to have and the fact that, in many cases, what they're saying is not true.
The cuts themselves are only one part of the problem we're facing. As I've already mentioned, it's the way the federal government has redefined its relationship with the provinces and territories that should be setting off alarm bells across this country. And I believe it's starting to be heard; it's starting to be felt. There's definitely a movement among many organizations, many groups, throughout Canada that are now saying enough is enough. We do hold some things sacred throughout Canada.
Under the Mulroney government, some $40 billion or more, depending on whose figures you use - some say $49 billion; well, I'm using a conservative figure; oh, I hear $51 billion - a major amount. I'm being very conservative here, which is not really my nature, but I'm trying hard. Okay, we'll go with the $51 billion - were cut from federal provincial transfers. This represents an enormous reduction in funding for vital social programs. The Liberal government continued this policy when they took power and cut another $8 billion or so from transfer payments. Now, that might be the 40, 42 or 43 plus the eight that would make $51 billion. Those are the ones that are identified. There are more cuts. There're more changes that are happening. These cuts are being felt throughout Canada, and they're being felt in the CBC program, something we hold sacred up here and that's needed by many people; the YES program; NGO programs that they offer for communities, for people. Within my own riding, it's having a tremendous effect.
The federal Liberals adopted the Conservative government's cuts, even though they weren't talked about during the last election, and advanced them even further and have run with them. Now what we have is changes in the rules which I believe put all Canadians at risk. This motion asks to try to address some of these risks, to try to slow it down, to try to protect the people of the Yukon, but to go even further than that: to become part of a movement to try to protect what we call Canada.
We're witnessing the nearly complete destruction of national standards in social services, and health care standards are not far behind. There's no longer a necessity that provinces and territories spend the reduced federal money on health or social programs. So imagine, you can get a chunk of money, a block transfer of money. Before, if it was for education, it had to be spent for education. If it was for the youth, if it was for the elderly, it had to be spent for them. It was marked for them.
Now it doesn't have to be. Now you can take the money that you received for the elderly and build more roads, build more mining roads - take that money and transfer it to where you may feel political pressure. There are no standards being attached to it. There are no conditions. There's no longer any requirement that social assistance be made available to those in need and that there be a right to an appeal. There are no standards that no one be forced to work for welfare. Yet, we have to pay more taxes.
So, these huge cuts every year are getting larger and larger and are affecting Canadians and are affecting Yukoners directly. We're still being taxed more. So, where are our tax dollars going? Who gave the authorization to be able to take, to cut and cut, to attack our national standards, the very fabric of Canada, and yet still keep charging us the same amount of taxes, to still keep taking more from the low-income working class and middle-income people?
Now, I've read in the paper recently as well, but I've also heard about this direct phone line. This is a request from the Liberal Opposition. I've heard about this direct phone line that they have with the Prime Minister, and I've asked them to call him up. I've also heard from some of the candidates who are seeking the nomination that it's a great advantage to the Yukon to have somebody up here that would be, if the Liberal government won the next election, that there should be a Liberal member up here, t
hat it would be a great advantage for that link because that direct phone line that they've already said they have would be even more direct, because that person may be living down there now. It's a 1-900 number with an answering machine on the end.
I asked them to phone. I asked them directly to save the YES program. It is a federally sponsored program. Phone them up. Save CBC. Maybe they don't care. Maybe it just doesn't mean much to them. The youth doesn't matter too much; let the feds cut it. That's all right. Let CBC be cut $300 million. That's all right. Let the NGOs be cut. All these affect the people in my riding. The seniors being cut - the programs - the changes to the Canadian Pension Plan. The small businesses are being asked to pay more into the Canadian Pension Plan. But then you read a little bit further and realize there is going to be less for the people that are retiring by the year 2000. Once again, more taxes - indirectly more taxes, less benefit. Why? That might be good if you are in a business and all you can think about is profit, profit, profit.
We all do know how the finance minister does his taxes. We are all very aware of how he has ensured himself that he pays what some people in his circles call his fair share. We also know how the banks pay their fair share. But what about the working people and other small businesses? What about the low income that still pay taxes and yet can barely get by. And yet, we are still facing cuts. These cuts are affecting the people of the Yukon.
I ask the Liberals to use their pull and demonstrate to the people of the Yukon that tremendous pull that they have. I ask them to demonstrate it to us today and make a promise that they will, and support this motion.
Mr. Jenkins: Thank you very much, Mr. Speaker. I rise today to support this motion in principle. The Canadian social safety net is a major feature in our country. Canadians enjoy it. I guess those damn federal Liberals are destroying it with their downloading, so we will just have to take them to task very quickly.
We have to recognize that in Canada there is really only one taxpayer that is funding all of these various programs. Numerous other federal programs have been downloaded previously: post-secondary education field, maintenance enforcement and numerous others.
While I do not agree with the federal cuts and the downloading as a way of balancing the federal budget to cut out the deficit, let us recognize, Mr. Speaker, that this government is well financed to weather a storm.
What I would like to suggest, Mr. Speaker, is that this government examine its priorities as to where its expenditures are going - eliminate the commissioners, their respective staff - and there'll be ample money to support a number of these programs such as the YES program.
Some Hon. Member: (Inaudible)
Mr. Jenkins: Well, that would be consistent in an approach - shoot them all.
Some Hon. Member: (Inaudible)
Point of order
Speaker: Order. The Member for Riverdale South, on a point of order.
Mrs. Edelman: What are we going to do with them? Shoot them? I see that as violent language, Mr. Speaker.
Speaker: I'm going to have to call the member to order on that and ask, pursuant to the recent SCREP recommendations to this House, that you withdraw those remarks, please.
Hon. Mr. Keenan: On the point of order, I'd also like to clarify that that is violent language and certainly the agreement with that is violent language, and I would say that they both are out of order.
Speaker: I just remind the members, even in off-hand remarks, that you could simply follow the guidelines that were put forward by the SCREP.
Withdrawal of remark
Mr. Hardy: Mr. Speaker, I apologize. I withdraw the remark.
Mr. Jenkins: Thank you, Mr. Speaker.
Mr. Speaker, it is my feeling that what we have to do is just get the government of the day to re-examine their priorities as to where their expenditures are going, and I'm sure with some prudent advice and some good fiscal management, they can address the numerous programs that are being downloaded from the federal government and address the responsibilities that are expected by Yukoners from this government.
Thank you, Mr. Speaker.
Hon. Mr. Sloan: Thank you, Mr. Speaker. I was trying to put some fright into my colleague from Riverdale South over there with my copious notes, here. However, I did see Hamlet last night just to reassure myself that some people spoke longer than I did. Having taken Polonius' injunction that brevity is the soul of wit, I've trimmed a little from my comments.
Mr. Speaker, today I would like to address an issue that does have a serious impact on all Yukoners and, indeed, on many Canadians. The federal Liberal government, which has long prided itself on national unity, has in fact, over the last few years, been systematically undertaking the dismantling of many of the programs for which this country is renowned and which give our country a sense of purpose and a sense of unity.
In its headlong rush to appease its fiscal financial masters on Bay Street, the federal Liberal government has forgotten ordinary Canadians. It's only in the past few weeks, Mr. Speaker, that many Canadians have begun to see the reality of the impact of the federal budget of 1995-96. Monday saw the cessation of numerous programs throughout this country. Last Friday, 2,500 CBC employees walked out the door for the last time, thanks to the cuts of this federal Liberal government.
In this territory, the most significant impact is that of the federal transfer payment cuts, which are now estimated at $20 million. For a jurisdiction such as ours, the impact is tremendous. We simply don't have the large-scale industries or population base to offset these losses.
Moreover, Mr. Speaker, beyond the transfer payment cuts, it appears that the territory will experience federal program cuts of an estimated further $5.3 million. In the last two federal budgets, $7 billion have been cut from Health and Social Services and post-secondary education - a cut of 40 percent.
All of these, Mr. Speaker, are from a Liberal government that tries to claim a social legacy. This government has proven one thing: it's proven and demonstrated its ability to protect its corporate friends. Massive family trusts persist, allowing many wealthy Canadians to protect family fortunes from taxes. Corporate Canada continues to enjoy a $51 billion tax holiday. The federal Liberals, who were so pious in their condemnation of the Mulroney drug patent law, have now agreed to the dominance of pharmaceutical multinationals and have retained Bill C-91, which costs Canadians and the health systems, primarily in the provinces and territories, millions - literally billions - in extra expenses. At the risk of being laughed out of this Chamber, I would remind the members of the Prime Minister's vow to scrap the GST.
It's estimated that the latest Liberal tax grab -
Some Hon. Member: (Inaudible)
Hon. Mr. Sloan: Okay. In fact, the latest Liberal tax grab, which is the supposed tax harmonization, will see a shift of $6 billion to $7 billion in the tax burden from corporations to consumers in this country, and of course we're still waiting for the 250,000 child care spaces.
Mr. Speaker, what I find most odious about this, however, is the determination of the federal Liberal government to wage a deficit war on the backs of the provinces and territories through offloading. Recently, I met with the social services ministers in Manitoba and Saskatchewan, who told me of the doubling of their social budgets that occurred when the federal government abandoned all fiduciary responsibilities to off-reserve First Nations people. The most recent provincial-territorial council meeting has asked aboriginal affairs ministers from throughout the provinces to consult with First Nations governments to get a clearer and more definite picture of what this impact is going to be on First Nations people throughout the country, but predominantly in the west.
Ministers from Atlantic Canada talked about UI changes that have reduced eligibility, increased the numbers of hours that have to be worked to qualify for employment insurance - formerly called unemployment insurance, now euphemistically changed. These changes have consequently ballooned social assistance demands and, Mr. Speaker, this is a situation which we are facing in the Yukon as more and more Yukoners simply do not qualify for employment insurance and are forced on to social assistance. We have an economy here that is very seasonal in nature. Many of the people in this territory work in jobs related to tourism and, unfortunately, the kind of qualifications that they now require do not allow them to qualify for employment insurance and, consequently, they are forced on to social assistance. It is being noted in increased social assistance costs.
I'd like to speak a little more about the situation in the Yukon, and I'd like to take a few moments to catalogue what the impact has been here and what it means to Yukoners. Let's just take a look at some of the impact of federal offloading in the last few years.
Young Offenders Act funding - this comes under the Department of Health and Social Services. The ceiling was set at the 1988-89 levels. The losses for us in 1995-96 are $258,000; in 1995-96, $250,000; the losses for 1996-97 will be $52,000 - almost $53,000. Mr. Speaker, we've seen the Department of Indian Affairs simply backing away from bills that are outstanding to this territory, primarily for issues surrounding child care. The losses for 1993-94 and 1994-95 are $8,143,000. The losses for 1995-96 are $9,434,000. Mr. Speaker, they've simply stopped paying. They don't pay, and this money is outstanding. So when the Member for Klondike refers to some moderate changes, I would dispute that.
The replacement of the Canada assistance program with the Canadian health services transfer has represented a loss in 1996-97 of $1.1 million. As I mentioned before, the changes to UI with reduced weeks of benefit, stricter eligibility, et cetera, we do not yet have a figure in, but we suspect that it will be a significant portion of increased social assistance costs. We just believe that this is the case.
Crossroads - the federal government has stopped paying for status First Nations people. This money did go to NNADAP, but we did not receive any of it to the treatment facility. That represents $115,000. Social assistance regulations, which help social assistance recipients in the Human Resources Development Canada programs, have been cut to the tune of $300,000. Skookum Jim's lost a federally funded counsellor to the tune of $30,000 and the child care initiatives that were promised by the federal Liberal government represent a loss to this territory of $774,000. Some of that will be recovered, to be fair, in such programs as the national child benefit, but it represents still a loss of $774,000 to us.
Now, Mr. Speaker, as you can see, this Liberal legacy goes on and on and, quite frankly, it's no surprise that the last true Liberal left in Canada, Warren Allmand, is heading for the hills and getting out of politics.
I'd like to take a look at what I regard is the most disturbing and damaging aspect of the federal withdrawal from the social field and that is the reduction to non-governmental groups.
The federal government has proved itself relatively adept at beginning programs, then stepping away after raising expectations. We've seen this most recently with programs such as the YES, the tobacco reduction strategy, new horizons for aging and other programs.
If this territory were expected to take up federally offloaded programs to non-governmental agencies, it is projected that it would be an additional $750,000. For us to take up the cost of such programs could only come at the expense of already hard-pressed NGOs.
Yet, Mr. Speaker, where is the outcry? Where are the social-conscious Liberals? They are strangely silent, strangely silent. I suppose they don't want to mess up their chances for a Senate appointment.
You know, Mr. Speaker, I can sort of understand the federal Liberal candidates. After all, they don't want to annoy their federal power brokers. And as Francis Bacon once observed, silence is the virtue of fools.
I'm a little more disappointed with my friends across the floor because I had supposed that they would have some measure of care for programs here. So, I've asked why haven't the Liberals in this House been standing up for Yukoners? Why haven't they spoken out? And then it struck me, Mr. Speaker. It struck me. It came as a revelation. They don't have the number.
The Member for Riverdale North, I want to you to observe this: they don't have the number.
So, Mr. Speaker, you know I was pondering this problem: why haven't they called. My friend from Whitehorse Centre said, "Get on the phone." And I thought, why haven't they called and this made me think, well, they've lost the number. So, I was wondering about this and a chance comment from my friend from Kluane kind of came up and it gave me an idea. I realized I had to provide the necessary number for my friends across the floor and as well, as an educator, Mr. Speaker, you'll appreciate this: you know the value of audio-visual aids in such teaching. So, what I would like to do is assist my friends across the floor in accessing their friends in Ottawa and, as you can see, "Dave Dingwall: say yes to YES. Give Dave a ding: 613-957-0200."
Well, that's the problem, that's the problem, Mr. Speaker. We've got two Dave's here and unfortunately, we're not the big Dave's.
Some Hon. Member: (Inaudible)
Hon. Mr. Sloan: I'm sorry?
Some Hon. Member: (Inaudible)
Hon. Mr. Sloan: Oh, have I stirred something there, Mr. Speaker? Have I perhaps probed a nerve?
So, once again, "Dave Dingwall: say yes to YES. Give Dave a ding, 613-957-0200." Now, Mr. Speaker, this has changed from the earlier number, which was 613-957-CHOP, so they have changed it; I think it's part of their strategy to keep any criticism off there. So perhaps I'll just leave it out here for members later on.
Now I'm very confident that they have the number. Mr. Dingwall will be subjected to a veritable cacophony from my friends across the floor as they rouse themselves against this whole question - cacophony, I'll send a definition - of federal offloading.
Mr. Speaker, humour aside, this territory has neither the population, the economics nor the political clout to deal with federal offloading of this kind.
At recent meetings I've heard Minister Pettigrew extol the virtues of cooperative federalism. If, indeed a renewed federation is desired, it needs to be realized that it cannot be accomplished at the expense of smaller jurisdictions. The federation is not Quebec and Ontario.
This new federation cannot be accomplished by financially and socially disenfranchising Canadians and Yukoners. It cannot be accomplished by pandering to the wealthy of this country, while forgetting the First Nations. It cannot be accomplished by remembering only the privileged of Westmont and Rosedale and forgetting the children of Carmacks and the seniors of Dawson.
Mr. Speaker, I ask that all members of this Assembly join in condemning the actions of the federal government in unraveling our social fabric.
Mrs. Edelman: Well, first of all, Mr. Speaker, I have heard the concerns of the members who spoke before me, and please rest assured that the next time I am on the red line with the Prime Minister of Canada, Mr. Chretien, I will pass on those concerns.
During my two terms of office as city councillor for the City of Whitehorse, I, along with the other councillors and the mayor, was responsible for approximately $240 million worth of municipal expenditures. Now, a portion of those dollars are from revenue from taxes and licensing and fees, but the vast majority of those funds came from a block funding arrangement with the territorial government. This block funding negotiation was started in 1985, coincidentally the same year block funding from the federal government started on the territorial level.
Now, I was not one of the municipal councillors who took part in the negotiation process with YTG, but it was my understanding from the city councillors who did take part in the process that block funding was a great improvement on the previous arrangements that municipalities had with the territorial government. Like formula financing to the territorial government from the feds, block funding brought the ability to make program funding decisions closer to local government. Previously, every time a capital project or a program was necessary, the City of Whitehorse had to go hat in hand to the territorial government and literally beg for the money to go ahead.
Many of us are parents, and we were all children, so we can understand that having to go to the federal government or the territorial government for funding prior to block transfers was a little like going to a parent for your allowance. It was not a happy situation. Territorial formula financing from the federal government supports the evolution of accountable government in the north by making territorial governments responsible to their electorates rather than the federal government for their fiscal decision making.
Now, as I look at the motion before us for discussion, I don't see any recognition from the government in power about what their responsibilities are to Yukoners. Formula financing makes the territorial government accountable to the local electorate. Now, during the election campaign, Mr. McDonald's party said - and I quote from page 23 of A Better Way - "The growing cynicism about government can be reversed if the government is more accountable for its actions." Does this government now say that they have no responsibilities toward Yukon people? Is this government saying that they don't have to be accountable to Yukon people for the responsibilities of health care and social programs?
Is this government saying they can't handle their legislative responsibilities under the Health Act and they want to hand those responsibilities back to the federal government? Personally, I see that as a step backwards and I'll never vote for that.
Formula financing is the principal source of revenue for the territorial government, along with program dollars. The federal government sends about 77 percent of our annual budget. Now, on page 14 of A Better Way, it states that New Democrats believe that people will only be able to thrive and prosper in strong communities where we all have responsibilities to one another and where we work cooperatively to achieve our goals.
Well, that's good stuff. One of our responsibilities is to our children. Sixty-five percent of Canadians want to eliminate the Canadian deficit and cut government spending. The majority of Canadians know that, until we get rid of the deficit, there can be no guarantees on our future. Despite this, the federal government has committed to a five-year predictable and stable funding of the Canada health and social transfer, and that entitlement will grow to the year 2003.
That commitment is far more than this government has given to Yukon municipalities. For the tenth year in a row, this government has frozen block funding to Yukon towns and cities. The Canada health and social transfer to the territorial government and the federal government is stable for five years, and it will grow. The territorial government expects municipalities to take on ever-increasing responsibilities as they are devolved to them without an increase in funding. Yet it seems to me that this is a little bit more like, "Do as I say and not as I do".
And what does this territory do? This territory, like all the provinces and the Northwest Territories, has the responsibility to deliver health and social service programs, build and maintain highways, provide services like electricity and fire protection, develop tourism and other economic opportunities for Yukoners, educate and house those that need it, protect our environment, administer justice, and develop land. All these responsibilities were devolved to us from the federal government.
Federal transfer funds allow us to carry out our responsibilities and the stark reality of our economic base is that we could not carry out any of those responsibilities unless we had federal funds to do it.
The other reality is that transfer funding allows us to set our priorities. If this government wants to set seniors housing as a priority, it can do it. And if this government wants to fund YES, then this government can do that.
The motion that we are discussing today says that there is a neglect of duty by the federal government because it is not carrying out the territorial government's legislative responsibilities. I would like to suggest that this government needs to take stock of what their duties are to Yukoners. Be clear about that. There are a lot of people out there who know what your job is. You have a lot of expectations out there that need to be met.
I realize that you have only been in government for six months, so perhaps people are still unclear about what their job description is. To refresh your memories, you are here to govern the Yukon. It is your responsibility, given the $483 million in the budget - 77 percent of which came from the federal government - to govern the Yukon. It is your responsibility to deliver programs to young people, seniors, First Nations people who request it, single parents, people needing medical care and those people who require social assistance. That is your job.
Mr. Fentie: Thank you, Mr. Speaker. Very interesting comments from the opposite bench.
I would like to add my support to this motion. As I mentioned in my budget reply yesterday, the federal budget cuts and offloading of programs has hurt many people in the Yukon, and especially those who are most vulnerable in our society. The federal Liberal government has broken faith with its citizens and the casualties are the young, the elderly, single parents, First Nations and low-income families.
Mr. Speaker, as I said yesterday, what Mr. Martin has been doing has been to dismantle everything that has been built up over the years, regardless of the social costs to communities. The social safety net is being sacrificed on the altar of deficit reduction - deficit, mind you, created by the two right-wing parties, the Conservatives and the Liberals.
What concerns me is that the federal Liberals now expect our government to bear the load while they cut our formula financing by $19.7 million. Unlike some of the very wealthy in this country, most Yukoners don't have trust funds we can pass on to our children tax free. Unlike some large corporations, most Yukoners don't have vast investments we can transfer outside the country to avoid paying taxes. Unlike some of our Liberal MPs, most Yukoners don't have the luxury of registering our companies offshore, as Paul Martin did, to avoid paying taxes.
The every day, average Yukoner works hard, pays their taxes, invests their money in the Yukon and Canada and then stands by and watches as the leaders of our country pander to their rich Bay Street buddies and the big banks in order to stay in power.
Mr. Speaker, it is time the federal Liberals stop giving special tax breaks to their power cronies and start ensuring that all Canadians share in the load equally.
If the banks and the power brokers started carrying their fair share of the burden, then the poor, the elderly and the youth of our country will not continue to be casualties of the deficit war.
Mr. Speaker, I believe the federal Liberal government has lost their way. For years they have been raising public expectations for funding for social programs, only to dump these programs in an effort to appease the financiers bent on deficit reduction at any cost.
Another manoeuvre used by the federal Liberals, Mr. Speaker, has been to offload programs on to the provinces and territories, hoping that the populace will lay blame on their local government when they can't possibly pick up the slack.
The youth empowerment program cut is a prime example of federal government offloading, and again it is hurting a vulnerable group in society: our young people.
Unemployment insurance programs have been cut; social assistance programs, cut; Canada drug strategy, cut; alcohol treatment programs, cut; child initiative funding, cut; and so on, and so on, and so on. This offloading has to stop.
In my community of Watson Lake, the burden of offloading is being borne by many groups who can least afford this extra load.
A case in point are the Signpost Seniors whom I spoke about yesterday. The seniors and elders are a very important part of the community fabric and we must ensure their needs are taken care of. The seniors in my community have already done their part. They've worked hard all their lives and their contributions to society are immeasurable. It is now our turn to make sure they are treated with the dignity and respect they deserve.
By cutting programming designed to help seniors maintain their dignity and independence, the federal government shows disrespect and disregard for those people who helped build this country.
Mr. Speaker, it is imperative that the federal government continue to fund programs and invest in our youth. They carry the future of our country on their shoulders and we must ensure that they are given every possible opportunity to prepare for this duty and to develop their potential in a positive manner.
The more the federal government cuts youth programs, the more of a negative affect it will have on all our futures. Our young people are our most important and valuable resource and we must support and care for this resource.
Mr. Speaker, it is well known statistically that the more money you cut from social budgets such as health care and education, the more money you'll end up spending on justice budgets. You either pay now or pay later, but keep in mind what the cost to society as a whole will be.
Mr. Speaker, it is my belief that the federal government must ensure that they continue their responsibility to fund First Nation programs as well as continue to invest in our future by supporting youth programs and caring for the needs of our seniors and elders.
Mr. Speaker, recently it came to my attention that the federal government has fallen behind over the last three years in share payments to various programs. This translates into a cost to our government of $17.5 millions in unpaid bills by DIAND. This neglect on the part of the federal Liberals adversely affects the programs our government is trying to deliver. This delinquency must be rectified as quickly as possible so that Yukon citizens will not be forced to carry even more of a burden than they already do.
Mr. Speaker, I would like to conclude this afternoon by asking all members of this Legislature to join me in supporting this motion. As elected members of the Yukon Legislature, we are here to represent the interests of all Yukon citizens and fight injustice, inequities and unfairness on behalf of our constituents whenever we have an opportunity to do so. I think we all recognize, in this House today, that the opportunity is now, and I urge you to support this motion.
Hon. Ms. Moorcroft: Thank you, Mr. Speaker. I'm rising to support the motion of my colleague that what we see in Canada today is a broken faith with members of our community who are severely affected by the federal government abrogating its responsibilities. I'd like to respond to the statement previous members made about how governments have responsibilities and that a fundamental responsibility of government is to be accountable to the public, as I certainly agree and believe that to be true.
It is also a fact that in Canada we have come to define ourselves as a country that takes pride in the level of social programs we've been able to offer and that takes pride in the fact that our federal government has taken responsibility in a number of areas and has funded programs which help ensure, for instance, that we have a well-educated society.
Under past education programs, post-secondary education was available to most Canadians because there was funding of colleges and universities so that tuition costs were heavily subsidized, and that meant that a lot more Canadians were able to have an education. That is changing and there are many things that are changing as we see the Government of Canada neglecting its duties as a national government in dropping support for programs that address social needs and that are necessary to our citizens.
Now we as a territorial government also have responsibilities and we are taking increasing responsibilities in the face of many federal cuts. I have to point out, Mr. Speaker, that we get many, many requests from members from the side opposite to add new programs or to take on additional responsibilities or to move airports or build more schools and governments have a responsibility of balancing limited amounts of funds available.
Regardless of whether or not the Yukon government steps in to fill the void that's been created by federal funding cuts, in most cases when the Government of Canada decides no longer to fund legal aid or to cut its funding to native courtworkers or to eliminate funding to the youth empowerment and success program, there are costs to the Yukon government and the Yukon public in one form or another.
Our government is not in the position of being able to automatically take on additional responsibilities when the federal government drops them. This does not mean that offloading has not happened. Costs may be more difficult to quantify if the Yukon government doesn't step in to fill the gap directly, but in the case of cost-shared programs, there may be reductions in the quality of service that the Yukon government is able to provide.
As an example, in legal aid, there now must be a much more rigorous assessment of when legal aid can be granted, leading to it being denied in many more cases. The federal government reduced its contribution unilaterally to legal aid by over $220,000 in 1994. This means that we have much less flexibility to manage cost increases within existing budgets. The Yukon government, where it does cost share a program, may face increased demands on related service areas and increased costs, and not have the money available.
Another effect can be elimination of service to the public, which is potentially very costly and damaging to individuals.
We also are damaged when the public perception of a government department is that it is unwilling or unable to fulfill a federal funding gap.
The native courtworker program has also been cost shared in the past by Yukon and Canada, and we are finding the demand for native courtworker services has increased while the federal funding has been reduced. This leads to programs running in a deficit position. It makes it impossible for the department or the carrier agencies to effectively plan in advance how to make the best use of their budgets, and it creates a great deal of uncertainty over future budgets. This affects the quality of service that the Yukon government can provide, and it is a serious problem of the federal government's making when they decide that they don't want to meet their commitments any more, that they don't want to take responsibility for what they have been responsible for in the past.
One of the Liberal critics made a point of discussing that Canadians want to see the deficit reduced. This deficit hysteria has been a feature of federal governments' actions for quite some time. It is not social programs that are responsible for the size of the deficit in Canada.
We have seen at the same time that social programs are being attacked and reduced that there has been a reduced tax burden on wealthy Canadians. We've seen governments with monetary policies that see enormous profits for banks and bankers, and we see increased suffering on the part of ordinary Canadians in our communities.
I'd like to speak for a moment about the new Employment Insurance Act. Under that new legislation, the federal government has made changes to the structure, delivery and responsibility for social programming. The federal system of funding for unemployment insurance, training, apprenticeship, post-secondary education and career counselling has undergone fundamental change with this legislation and will continue to do so. Some of the cuts that have occurred include eliminating all programs associated with the consolidated revenue funding, which will cost the Yukon $1.8 million. In 1996-97, there was a cut of $1.7 million, a large portion of which would have been spent on the direct purchase of training at Yukon College. The government-to-government funding for course purchases at Yukon College will be eliminated in three years with a loss to the college of approximately $1 million.
Overall, the federal government's changes will severely affect Yukon College and colleges across Canada and the students who are interested in their programs. In our rural communities, most of the students at the community campuses were consolidated revenue funding clients who were not eligible for unemployment insurance but could receive funding for training or educational purposes. They will no longer be eligible to receive any post-secondary support if they are not eligible for unemployment insurance.
Now, despite federal cuts, the funding at Yukon College has been maintained at the same level as the previous year. It means, however, that resources need to be taken from other areas of government priorities in order to continue that level of funding for Yukon College.
The federal legislative changes will also put more of a burden on Yukon in apprenticeship support. Previously, apprentices had received unemployment benefits while attending training courses. They are now required to be eligible for employment insurance in order to receive income support from Canada.
The established program fund, which covered post-secondary and social assistance programs has been combined under the Canada health and social transfer and reduced by several million dollars in the current year, with further reductions expected in the future.
The reduction of federal transfer payments for post-secondary education under the Canada health and social transfer has led to rising tuition fees at institutions across Canada. Canada has extended its student loan program, but the net effect is to transfer a federal cost to the student who is assuming an ever-increasing debt burden. This is resulting in increased polarization of society and can lead to educational opportunities only being available to wealthy Canadians in the future.
Provincial and territorial education ministers are working together to convince the federal government of the error of this approach, but without support in this House from members opposite, I don't have a lot of faith that we will be able to be effective in that.
There are a number of public school programs that also have been affected by federal offloading, including the stay-in-school contract. In 1995-96, the Yukon government assumed 100 percent of the cost of this program to provide continued support for First Nations students at F.H. Collins after the end of a one-year agreement. The Yukon government has picked up funding for a school attendance counsellor for Dawson City, which was cut by the federal government. The math tutors program, which was instituted by CEIC and then funded by Health and Welfare Canada has been cut and the Yukon government has picked those up.
We see a pattern emerging where the federal government will change the name of the department responsible or change the mandate of departments responsible or simply eliminate the program, as they did recently, as the Minister of Health and Social Services spoke about when he was speaking.
There have been co-op education funding agreements in place, and the federal government has cut, initially, 85 percent of the costs for that program down to 35 percent of the costs in the current year. The Yukon government sees the co-op education program and the co-op education First Nations programs as critical links between schools and the business community.
So, the Yukon government's been picking up funding for that program. We can't continue picking up funding for all of the programs the federal government is divesting itself of, and offer the existing programs that we're responsible for.
I know that my colleague is going to speak about some of the cuts that have affected First Nations, such as the aboriginal women's program and the aboriginal friendship centres. The funding agreements on aboriginal languages are being cut by the federal government, and that is leading to increased costs for the education department.
The Secretary of State eliminated the funding to women's programs a few short years ago. There was a massive outcry from Canadians, demanding reinstatement of that program. It was reinstated, but it has been drastically reduced. We now find that women's groups are only able to apply for project funding and are no longer able to apply to the federal government for core funding.
So I think, Mr. Speaker, that some of those areas that affect my responsibilities demonstrate the fact that the federal government has broken its faith with Canadians. I think it is important that the federal government do take responsibility and no longer raise public expectations of funding - as they did when they promised a national child care program, which they've failed to deliver on - and then retreat from the programs, or offload responsibility to other levels of government.
I would encourage members to support this motion, and I thank my colleague for bringing it forward.
Mr. Ostashek: Thank you, Mr. Speaker.
I rise today to speak to this motion that's been presented by a government backbencher on downloading from the federal government. While there's a lot of merit in the motion and what it says, there is no doubt, I agree, that there has been a substantial amount of downloading by the federal government, or their taking the easy way to meet their budgetary targets. There's no doubt in my mind.
When we have a federal government that solves their budgetary problems by cutting transfers to the provinces by some 40 percent, and only reducing their own program spending by less than 10 percent, something is out of sync in this world, and it's very hard to support a government that does that.
With having said that, Mr. Speaker, the reality of it is, this is not new. We have a Liberal government now that is going into the fourth year of their mandate, almost the fifth year of their mandate, almost completed the fourth year of their mandate. They will be going to the polls very shortly, and I think that members opposite, as well as our caucus here, have to recognize that the federal Liberal government has been very successful in selling to Canadians the cuts that they have imposed, because, they, as I believe the Minister of Justice just said, didn't have to bear responsibility for the cuts, and I believe the Minister of Health and Social Services just said it, too.
So they've taken the easy way out. But, we can stand here and chastise the federal Liberals - and I sort of enjoy doing that, too; I don't have any difficulty with that - but, that's not going to solve the problems that Yukoners are facing. The cuts are there; they've been made. If we can believe the federal Liberals, we are entering into a period of stable funding in the areas of health and social services. And, I believe that all governments, this government included, have to live up to the realization that the cuts are there. They're not going to be reversed.
We can debate a motion like this every day in this Legislature, and it's going to have no impact on Mr. Martin or the federal Liberals, or our Liberal colleagues here, too, as far as that goes. This will have no effect on them whatsoever. The ineffective Opposition by the way, Mr. Speaker.
But, what I'm trying to say is that I believe the government, the Yukon government, members opposite, have to get their priorities straight. And, we have listened, since this government has been elected, to them pleading poverty to the Yukon people. They don't have the money; they don't have the largess that other governments have had.
Well, Mr. Speaker, that's a reality of today's situation, and that's the reality of what governments are faced with in Canada.
My colleague from Riverdale North says they are better off than any other government in Canada and that's exactly right. That's the point that I'm trying to make, Mr. Speaker. This government is well-financed and, when they were in Opposition, they reminded us of that every day, that we were not short of money, we didn't need to impose a wage freeze, we did not need to raise taxes because we had lots of money. Well, they have lots of money.
We absorbed a $20 million cut - yes, we did - a greater percentage than what the provinces had to. We fought that very, very hard, to no avail. The minister would not change, but I do think that we made some gains by getting some adjustments to the perversity to offset that.
The reality of it is I heard one of the members over there - I am not certain which one it was now - saying the transfer payments are going down. The reality is transfer payments are going up. They're going up; they're not going down. We've absorbed the one-time-only cut and, if we look even at the projections of this administration's budget, they are projecting that transfer payments are going up, and they are going to continue to go up, not only with devolution but just with population adjustments. Faro mine's shutting down. If it stays down for any length of time, it's going to give this government more money, not less money. That's the perversity of the formula financing, Mr. Speaker.
This debate has gone on and on in this Legislature before, when the members opposite were in Opposition and we were in government. So, let's look at the real situation here. This government is well-financed. Sure, every government would like to have more money. No doubt. But I'm going to say to the members opposite the same they said to us when we were in power: it's a matter of your spending priorities. And you have been elected by the people of the Yukon for this mandate, and it is your responsibility to set those spending priorities. Certainly, you cannot fund everything that the federal government has dropped or downloaded, but you, as a government - you as a Cabinet and a caucus - have to decide what your priorities are, what you're going to pick up and what Yukoners can afford to do without. It's not an easy task and I don't envy you for it. But I believe that if we're going to just continue to stand in this Legislature every session - I believe in the last several years there has been a motion very similar to the motion put by the Member for Whitehorse Centre condemning the federal government for downloading - we are not going to move yardsticks ahead very, very far. Because, let's face it, the federal government really doesn't care what we say here in the Yukon. They have one MP here. That's the most they can hope to elect - just one. Not very much impact.
I believe that the responsibility of the government of the day is to sit down and make those hard decisions. We know that this government went out there and raised expectations of a lot of NGOs during the election campaign and prior to it, but now they have to deal with those expectations that they raised. As I said, we can sit here and continue to cry. We can sit here and continue to plead poverty. It is not going to increase the amount of money we are going to get from the federal government. It is as simple as that. We are well-funded in the Yukon. We have been for many, many years. When we look at the per capita transfer here compared to some other jurisdictions, it is very easy for the federal government to target a group of people that are getting a greater amount of the federal pie on a per capita basis than what other Canadians are. I do not agree with it. I do not agree with it at all, but it is a reality.
The Minister of Justice said it was not social programs that are responsible for the cause of our deficit. Well, I will agree with her to a certain extent - not entirely. But the reality is that everything that we have done in Canada for the last 25 years, we have done with borrowed money. You cannot run your household budget that way - nobody can. The federal government had to do something.
In fairness to the federal government - I am not a great fan of the federal government, no more than I am a great fan of this administration - but the reality of it is, let's give credit where credit is due. The federal government did, by their actions - hurt some Canadians and hurt some other governments, who had to turn down people because they didn't have money because of federal cutbacks - accomplish lowering interest rates in Canada to where people now have more money in their pockets. The sad part right now is that it appears that the wheels are going to come off just when we should be starting into an economic upturn in this country.
And that, I guess, is one of my greatest concerns with what the federal government has done and what Mr. Martin has done in his budgetary figures, is that he has not ... well, he's used very conservative targets so that he could look good. He has done that, as I said, by downloading to the provinces. He has done that by digging into the employment insurance fund to the tune of $5 billion a year, payroll tax increases, the Canada Pension Plan, which is a payroll tax, and, if you listen to businesses - small and large - they say it's a job killer in this country.
So, while the Member for Mount Lorne may figure that Canadians and Canadian corporations are not taxed enough, there is that delicate balance that the government has to find as to when are we taxing too much and providing a disincentive to creating jobs for Canadians, because, let's face it, that's one place that the federal government has failed and failed dramatically - providing jobs for Canadians.
Mr. Speaker, in our own territorial budget here - our expenditures on the operations and maintenance side - 60 percent is for social programs, when expenditures on education, justice and health and social services are combined. Sixty percent of our budget now goes to the social side of the ledger. That's a big nut to crack. Can we put more into it? I doubt it. I think we have to look at how we can redefine it.
So, we have that expenditure, and if you take Yukon Housing's expenditures, they can also be considered for a major portion as part of the social side of the agenda.
I guess where I start having difficulty is when I look at the budget that has been presented by the members opposite, and while the increases are not dramatic on the operations and maintenance side, they are there, and you can put whatever words you want around it. You can blame devolution for it. You can do whatever you want. The fact is that operations and maintenance costs of government are going up. This administration has hired more personnel. We'll get the numbers sometime during this session to see exactly how many there are, but those are ongoing costs that are going to continue to build. There isn't a government in Canada that has that luxury, and I caution the members opposite that they really have to re-evaluate the direction that they are taking there.
We're going to have to watch those expenses if we're going to continue to provide the programs to Yukoners that Yukoners want and deserve. We've had commitments from the Member for Whitehorse Centre for the St. Joseph hostel for the homeless, or whatever it is, in his riding. They are very admirable causes, but they all cost money. Where's the money going to come from?
As I've said, we can sit here and beat on the federal government. It isn't going to get us any more money - not one cent more; it's not.
The other thing, Mr. Speaker, it's not only the cutbacks in transfers from the federal government to the provincial and territorial governments that's hurting. In the north, where the federal government is a major player in the Yukon and the Northwest Territories, the cutbacks to their own programs are having a dramatic impact on Yukoners.
Let's face it, there's only one taxpayer in this country. Whether he pays his taxes to the territorial government or to the federal government, there's only one taxpayer. Maybe the members opposite don't agree with it, but the movement across Canada is for a reduction in personal taxes. People are tired of paying taxes. So, governments are going to have to learn to do more with less.
And as I say, we've been very fortunate that while we have endured cuts, and cuts that have caused some difficulties, we have not fallen victim to the massive cuts to social programs that have occurred in other parts of Canada. We have not had to close hospitals. In fact, we have a state-of-the-art hospital that's in the final stages and I believe it will provide a very good service to Yukoners for years and years to come.
There's no doubt that Canada's social safety net is being stretched to the limit, Mr. Speaker, but if we are just going to take the approach that we are going to blame the federal government for it, then we're not going to do justice to our citizens. We are going to have to look at programs, such as the YES program, and analyze it, review it. Is it, in fact, going to save us costs down the road? Is it worth the investment of that $100,000-odd?
This government has taken it upon themselves to spend quite a few dollars on bureaucratic processes that they feel are important. Is that money better spent on the commissions they've set up, or is it better spent on programs such as YES? Those are the decisions you people have been delegated to make, not the Opposition. You people have been delegated to make those decisions. We're here to criticize what you do.
That's the way this Legislature is set up, I'm sorry.
During the years that we were in office, the Yukon Party undertook consultations in every community, seeking feedback from Yukoners on important health care issues. Areas that were discussed included health program delivery, dental programs, continuing care, midwifery legislation and social assistance. Those were consultations that were done during our mandate.
Reform efforts are ongoing, as we see, and I'm pleased to see the memorandum agreement that's been signed by the Yukon government, the federal government and CYFN, which demonstrates their commitment to public participation and consultation in an effort to ensure the communities, as a whole, will now be involved in the delivery of health service programs to Yukoners. But again, we have to be cautious about what sort of an administration we build up to deliver these services. We're a really small population.
Speaker: Order. The member has two minutes remaining to conclude his remarks.
Mr. Ostashek: Thank you, Mr. Speaker. It's been a very quick 20 minutes. I didn't know I'd have so much fun in this debate.
But the reality of it is we have to be careful of administration costs in a small population like we have. And I know every community wants to have a hands-on approach. That's human nature, but we have to make sure that it's not going to add to the administrative costs of delivery of programs. We have to look at the most cost-effective way of getting that input from the communities to the decision makers.
So, Mr. Speaker, also when we were in government, the premiers, the APC, took it upon themselves to put together and provide some leadership and influence in national social policy, as many of the social programs are in provincial jurisdiction. And at the conclusion of this, Mr. Speaker, in 1995, the leaders established the ministerial council on social policy reform and renewal, made up of a representative from each jurisdiction. I think that's been a very successful process, and I think it's had some influence on the federal government. I believe that we can continue to provide some leadership and some direction to the federal government on how to harmonize and how to restructure the social programs so that there isn't a further impact of downloading to the provinces.
I agree with the members opposite. Downloading by the federal government has been excessive, but I also take this opportunity to go on the public record to say to the members opposite that they have a responsibility to do with their budgets what they can to fill in the gaps. They can't pick up everything the federal government is dropping, but they have a responsibility to Yukoners to fill in the gaps.
Thank you, Mr. Speaker.
Hon. Mr. Keenan: Thank you very much, Mr. Speaker.
Mr. Speaker, I will not take up much time this afternoon. Although, I would love to take up very much time this afternoon to rebut some of the comments that have been made, but I certainly speak in favour of the motion and I'll explain why I speak in favour of the motion.
I was indeed very pleased to hear the previous speaker clarify, in his closing comments, that he was willing to support this motion. I also will listen to his comments and put them where I may.
But, in holding with the line and thoughts, somehow or other we must come out of this quandary of where we're at. I think it's expectations. I hate false expectations. I think that this Legislature, and any Legislature across this land, whether its territorial, provincial, federal, can work to people's expectations, and that's by working with the people.
Well, I'm very pleased to say that this administration defines, in A Better Way, how we're going to do that. We were left, not only by the previous administration, but also by the federal government, with expectations that we have to live up to.
We certainly realize that administration, how to priorize, and we're going to do that and we have done that, and I think it's reflected in our budget.
I must also say though, that what is not reflected in our budget is that the expectations of the average Canadian - be it as a man, a woman, a child, a First Nation citizens or a Canadian - were brought forth, not by the people, but by the government, in light of getting elected.
People will do anything to get elected. Well, I do not think that we, in our platform, A Better Way, did that. What we did was clarify exactly what we had to do. Now we're left with expectations.
I do not like to stand up here and be critical of other peoples and other governments, but I do understand the nature of the Legislature also, and I hope that at some point in time, that, with consistency, we'll get away from criticizing and we'll get focusing - focusing on what the real issues are and how we, as people representative of all Yukoners, might be able to move forward on issues and not personalities.
My greatest fear, from federal offloading, downsizing - call it what you will - is that, as they go through that process, we create another process called devolution.
I'm very pleased to be a part of this government that has signed agreements with First Nations governments because I do believe that that is what I was talking about by representing people based on issues. That is what we were doing and going to do within that process. Now, when you offload on one side and say there is a process on the other side, it seems to be a juggle of resources, not an identification, nor, I don't think, in part, a true commitment. So I am, in part, questioning the process of devolution.
I came, as my Cabinet colleagues and indeed all of my colleagues, with expectations that we are going to work towards providing better services through the devolution of lands and resources to Yukon.
If you look at the offloading, the downsizing, the raising of expectations, the passing the buck to the territorial government, well then it makes me very nervous. But we are going to proceed. But I do want to raise that now, that if we are raising people's expectations, it's got to be defined within that process.
So we must hold the line, and I expect that the federal government will be an honourable partner in holding that line when we sit down with the three orders of government to clearly focus on the issues. I hope that we'll be able to focus on the issues and not on the downsizing or the passing of the buck or the politics of it. I think that what we have incumbent upon us is the responsibility to focus on the issues.
Mr. Speaker, let me just talk a little bit about the effects on aboriginal people. From the Canadian heritage, the aboriginal friendship centres are down from last year $1.561 million. The Northern Native Broadcasting access is down $1,414,000. Aboriginal representative organizations, down $706,000. The aboriginal women's program, down $207,000. The Canada-Yukon cooperation funding agreement on the development and enhancement of aboriginal languages transfer payments, down $25,000. Mr. Speaker, I hope you can see what I'm getting at. Expectations have been raised, the buck has been passed, the money is going down. I do believe that if we all clarify what the issues are, focus on what the issues are, nothing is insurmountable. I suggest that to this Legislature. I do not have all of the answers but I do think that through dialogue and communication we might be able to focus on those issues.
Mr. Speaker, the list goes on.
I cannot simply believe this at times, because First Nations people are struggling through our desire to look after ourselves, and we are looking after ourselves, based on our very own cultures and traditions, and when we are borrowing money to move forward and to recognize the elders of our nations and the federal government is simply cutting back on the loan equity that we pay to our First Nation elders, well, that is not right. That is absolutely not right. This year the loans again have gone down - loans, I stress, not passing the buck, but loans.
Contributions to the Government of the Yukon Territory in relation to the Canada/Yukon economic development agreement are down $1,877,000. Mr. Speaker, I do suggest that if that's not passing the buck, raising expectations, taking away the expectations, I don't know what that is. So, I encourage all members to pass this resolution so that we might be able to move forward on a government-to-government-to-government basis representative of all our people to focus on the very issues that affect us as Yukon people.
I do believe - I'm trying not to use unparliamentary language, and I'm trying to think of another word for parliamentary language - the dissemination of our resources to create the almighty buck is not the answer, and it should never be the answer, and it should never even be the question.
And so, I just get back to the expectations. I encourage all members to focus on our motion and to encourage people to move forward to think about it - what the real issues are - and to focus with dignity on how we can get out of these problems, Mr. Speaker, because I do believe that that is the actual problem. If it is the reality that life must go on and that expectations are going to be raised and bucks pulled, well then let's start to change that. Let's recognize that for what it is and change it.
Does that change the immediate problem that we now have? No, it does not, and I must say, after listening to the previous speaker, that I wholeheartedly disagree with most of what he has said. I do believe that there are better ways of doing it, and that if we sit down collectively, we can do that for the people of the Yukon. I do believe that a jurisdiction - you've heard me say it before - of 30,000 people can get together and do these things.
Mr. Speaker, I encourage all people here to do that. Thank you very much for your time.
Mr. Cable: Mr. Speaker, I was very pleased to hear the somewhat collegial approach to the issue given by the previous speaker. I think he should talk to some of his colleagues and get them off this class warfare that they've been propounding all afternoon. The last great practitioner of class warfare, Bob Rae, was unceremoniously dumped by the voters in Ontario, and that's something for everyone to remember. If you want to divide people by driving them apart, there's a penalty to pay.
Now after the last election, which is six months ago - seven months ago, I guess, is it? Six months ago. You could hear this monstrous "whoops" happen. You could hear the wheels go around in the government's collective head. Boy, oh boy, we've got a lot of debts out there. We'd better find somebody to blame for not being able to perform. Now there were two bÍtes noires they found to blame. The first are these gentlemen to my right here, the previous administration. You know, these socialists in conservative clothing - these profligates - these financial profligates that spent every sou they could get their hands on. And if you don't believe that one - if you're having trouble selling that one - well, there's always the feds to bash. So this is where we are today; we're fed bashing. We've run out of bashing the Yukon Party, I guess.
Some Hon. Member: (Inaudible)
Mr. Cable: Okay, we haven't run out of bashing the Yukon Party. I'm corrected.
So, let's have a look at some of the facts that I should draw to people's attention. Firstly I'd like to refer you to the Yukon Act, section 17. What does it give to the Yukon? It gives the Yukon the power to make ordinances, now statutes, of course, in relation to the following classes of subjects: Number H is property and civil rights in the territory, Q is the establishment, maintenance and management of hospitals in and for the territory and, then, down below, generally all matters of a merely local or private nature in the territory. That's really a paraphrase of the provincial powers in our Constitution. So the powers are there to do what this government is supposed to do for all these people that are referred to in the motion. And the power has clearly been exercised and recognized by this government.
Let me just read you a couple of excerpts from the budget speech to show you that the responsibility that flows from that authority in the Yukon Act has clearly been adopted by this government.
Page 2 in the budget speech, "As the Yukon moves into a new era of responsibility for its own affairs, our government has developed a forward-looking budget that preserves our high standard of education, health and social services." And here they are today, whining about not being able to do that.
On page 8, "The Minister of Health and Social Services has met with many of these organizations" - those are non-governmental organizations - "to discuss their needs. The government has approved a plan to provide predicable funding and we will be discussing it with the NGOs in the near future." A recognition of the obligation and a meeting of that obligation.
On page 17, the Government Leader says, "Mr. Speaker, our government also recognizes that access to decent shelter is a fundamental requirement for all people. There is clearly a need for housing that is within the means of families of various economic levels." Then on and on.
Under "Securing social services", we have the Government Leader saying, "Our government believes we have a moral obligation to ensure that Yukon people continue to have access to the highest possible standard of health, education and social services. This is reflected in our budget." It doesn't say the federal government has beat on us, we can't do it. It says, "This is reflected in our budget."
"In the area of Health and Social Services, this budget shows an increase of $8.8 million in operation and maintenance expenditures." Then they go on to say, "This is a big step toward assuming full responsibility for our own affairs. It also gives Yukon people the opportunity to develop a health care system that is more directly responsive to community needs and wishes." This is contrary to what we're saying today. We're whining and sniveling today, but in the budget address we had a clear recognition of the responsibilities and a clear plan of action, according to the government.
"There is also an increase of $526,000 for continuing care. The Department of Justice will spend an extra $160,000 for a family violence prevention unit and $80,000 more for victim services." Then there is a chapter entitled, "Investing in Yukon's youth," and it goes on and on and on.
The government clearly recognized its obligations and clearly felt it could fulfill its obligations. So, here we have this motion this afternoon, purely for political purposes, trying to finger the federal government for some alleged wrong.
Let's go over the money we receive from Ottawa. The Canada health and social transfer was $16, 731,000. The transfer payment was $285,056,000. The phase 1 health payment was $4,804,000, and recoveries from the Government of Canada on programs was $39 million, adding up to $345 million, 77 percent of our revenues.
Now one of the beauties of the Internet that I have found is that you can find all kinds of interesting bits and pieces of information. Our researcher was playing on the Internet and found all the major federal transfers to provinces and territories. We find, in looking at this, an almost embarrassment of riches compared to some of the provinces, like Newfoundland and Prince Edward Island. I'm going to file this with the Clerk. I'm sure he would like to read it, and he'll make it available to the members opposite when they get up and want to decry our financial position. I wonder if the page would take that to the Clerk.
Now, we have no debt in the Yukon. We pay no interest on debt - no significant interest anyway. Ottawa has $600 billion in debt. One-third of their budget goes to interest. What I say to the Members opposite is, read the document that was just filed, absorb the financial situation of the territorial government vis-ŗ-vis the federal government, and give your collective heads a shake.
As the Leader of the Official Opposition has said, the transfer payments have not gone down recently; they've gone up. One has merely to look at the budget address. The 1995-96 transfers were $309 million. The forecast for the fiscal year just ended is $286 million, and the estimate in the budget is $306 million. If one wants to play with statistics, one can say, "sure, if you go back two years, they've gone down by $3 million." Now, the program recoveries, of course, have dropped quite markedly. If that's where they're trying to make the case, then perhaps they should focus on that.
The best protection for our social programs is a financially stable federal government. With 77 cents on every dollar coming from the federal government, we must have financial deep pockets that are financially stable. That's happened in the last three years. When you have a financially stable federal government, you have low interest rates, as we have. We have easier financing for business, and we have lower mortgage rates for people that want to build houses. That has all happened in the last three years. It hasn't happened without some grief. That's admitted by everyone, but it has happened.
The federal government has reduced its foreign borrowing, which gives it a lot more discretion in dealing with our social programs. So, before we wind off in every direction and try and blame the federal government for our inability to perform on our election promises, I think we should examine what's going on.
I think, Mr. Speaker, I'd like to introduce an amendment to the motion, which would probably recognize what's going on and get away from the finger pointing that the Member for Ross River-Southern Lakes was talking about.
I wonder if the page would come and pick this amendment up? Read it into the record?
Mr. Cable: I move, by way of amendment, Mr. Speaker,
THAT Motion No. 52 be amended by deleting everything after the word "that" in the first paragraph and substituting for it the following:
the federal government has reallocated their expenditures to reflect the priority Canadians place on social programs and deficit reduction;
the federal government, in the face of severe financial restraints, has provided stable, predictable and sustainable funding for health care and other social programs through the Canada Health and Social Transfer;
the federal government has kept their commitment to young people, seniors, First Nations people, single parents, people needing medical care, people receiving social assistance and other low income Canadians by reducing the deficit, thereby stabilizing the federal financial position, permitting the maintenance of funding of the Canada Health and Social Transfer.
Speaker: The Speaker must rule this amendment out of order, and I make reference to Beauchesne's Parliamentary Rules and Forms, 6th Edition, that essentially says that an amendment cannot be contrary, cannot simply put a motion into a negative form. So, the amendment is out of order.
Mr. Cable: I would have thought that this was just by way of clarification. I'm not disputing your ruling by any means, but just to clarify I would have thought that the faint praise that is in paragraph 2 on deficit reduction could've been enlarged upon and clarified and that the member that made the motion would've been quite happy to have had his thoughts clarified.
Anyway, we've seen today the attack on the federal government under the guise of class warfare. We have seen the blaming taking place. It isn't constructive criticism. It's finger-pointing and very, very negative politics. I have to say, even though the amendment didn't fly through, that I'd have some difficulty supporting the motion as put forward, partly because of the motivation behind the motion - something to do with federal politics, I guess - and also because of the underlying problem that I have, and I think the minister from Ross River-Southern Lakes shares this - the problem we have of finger-pointing at people instead of bringing them together.
So, I'm not going to vote for the motion for that very reason.
Hon. Mr. McDonald: Thank you very much, Mr. Speaker. All I can say is, thank God the New Democrats won the last general election in the Yukon. I've never heard such a diatribe from my good friends opposite in both the Yukon Party and Liberal Party in their defence of federal actions. I've never heard so many contradictions uttered in one speech at one time in months or years.
The Liberal House Leader - the Leader of the effective Opposition, that is the new terminology, I guess - tabled an amendment to the motion, which acknowledges that the federal government has a commitment to young people, seniors, First Nations people, single parents, people needing medical care, et cetera, et cetera, just after having read out the Yukon Act, which claimed, in his theorizing, that the Yukon government had this responsibility and to live up to that responsibility.
Mr. Speaker, that is a complete contradiction. The Liberals in this House this afternoon have put forward the preposterous allegation that if the federal government pulls out of responsibilities or of funding arrangements they have to the people of this territory, then they never really had any responsibility in the first place, and it's the Yukon government's responsibility, therefore, to pick up the federal share of federal programming. What nonsense.
This is not about blame games. I am not blaming the federal government for anything. I am pleading with them to stop raising public expectation in this territory and then denying - to quote the member's ill-fated amendment - young people, seniors, First Nation people, single parents, the child care program, seniors, the seniors program in Watson Lake, young people, YES, First Nations people; there's a whole series of programs that are being cut back in those areas: medical care for people, social assistance, denying these people services that they had been led to expect the federal government would support.
The major concern I have about federal actions in the last few years - and I don't even share this concern as much about the previous Conservative government, even though I had my disagreements with them - was that there was an attempt by federal authorities, by federal politicians, to demonstrate that they are maintaining their commitment, or they're showing a commitment to somebody, by inserting themselves into the equation with seed funding - pilot project funding - to support an obvious need in the community - a need that they recognize that they have responsibility for or they wouldn't have put money there in the first place - and then pull it back after a couple or three years.
Now, if in this Legislature, members who are elected by people in the Yukon - Yukon citizens - who owe their allegiance to Yukoners, if these people would defend the rights of Yukon and object where they thought it was due, then I would have a lot more faith in the utterances of the Liberal members in this House. But when the members opposite hear the criticism, what we hear in return from a number of members, even this afternoon, is that they shouldn't have to worry because they're 52 percent in the polls federally, nationally.
I'm not particularly interested, as the Leader of the government, or as a member of this Legislature, what the federal Liberals are in the national polls. I'm interested in the welfare of the Yukon and Yukoners. I would expect the people who are elected by Yukoners would show some allegiance, not only to Yukoners, not only to the federal government and to the federal needs - because we're Canadians too - but also to Yukon.
I would say that in this particular case, and in the cases that we've identified this afternoon, these are areas which are much needed. We have members on opposite benches parading with various groups and organizations who've been cut by the federal government, parading with them, inciting them, to come to this government for support, never once identifying the need for them to go to federal authorities, where the cuts came from in the first place.
Now, Mr. Speaker, the Liberal Leader says that the NDP, in the last election, came into government and said, "Whoops, we gotta blame somebody, because that's the way the system works. Gotta blame the Yukon Party; gotta blame the federal government, because we don't have the money to maintain our commitments."
That's not what we said at all. We did not engage in the same kind of bidding war that the Liberals and the Yukon Party did. I'll state that to my dying day. A bidding war that's still propagated by members of this Legislature in the Opposition benches. We did not play that game. We did not raise those expectations.
But, Mr. Speaker, we're not whining and snivelling about the need to maintain our commitments through our budget measures in this Legislature. We've maintained our commitments to the people we fund in this territory to the service levels that they have come to enjoy. And, we have made a commitment to them too, that we're not going to do what the federal government has done and tantalize them with some funding and then pull it back when it seems convenient.
We are going to make a long-term commitment to those people to maintain those services, because we do think that there's a need and there's a moral need to ensure that those services are not only maintained, but that people are given the reassurance that as long as they perform well for the people of Yukon, they will continue to get our support.
We did not - and I repeat - did not promise to fulfil federal commitments to this territory. This budget does not contain sufficient money to fulfil federal commitments to this territory and it never will.
Now Mr. Speaker, a common refrain by the Liberal member - and I was really surprised to hear the Leader of the Yukon Party sort of maintain this note - the common refrain is, "Well, the Yukon government gets a lot of money already. They get lots of money already, so why should they complain if the federal government cuts back and people come to the Yukon government and ask us to pick up the tab?"
Well, there was a legal principle that was pioneered by the Leader of the effective Opposition last December. This legal principle I'd never heard before, but it seemed kind of intriguing, was, "So what? So what that we get more money per capita than Newfoundland. So what that we get more money from the federal government than does Ontario or Manitoba. We have a very small caretaker population with big responsibilities."
If the Liberals are putting forward the proposition that if the federal government cuts back and we are forced to pick up the bill - we should be expected to pick up the bill - they are therefore suggesting that we are probably overfunded as it is.
Now, if they're saying that we're overfunded as it is, state it for the record.
But I must say, from these paragons of consistency, we've also heard
members opposite talk about the need for more spending on virtually every single front - schools, jails, programs, federal programs, et cetera - and they want it to be force-fit into this budget. What we promised in the election campaign, Mr. Speaker, was to maintain services - not maintain federal services but maintain Yukon services. So this proposition that we are expected to pick up these programs is completely and totally outrageous.
Mr. Speaker, Yukon government has not said that we cannot live up to our commitments. We have said it is largely a measure of spending priorities, and we will defend our spending priorities in this Legislature, but if the proposition is that we should spend wildly in all kinds of capital areas, spend everything - I mean, they haven't suggested anywhere we should cut back other than commissions at all; they spent that million dollars about 50 million times - and if they are suggesting that that is the only area where they expect a cut, then let's have the debate.
The Member for Riverdale North the other day said, "You can spend money from Shakwak. You should have put it into a school, if you really believed in following through with that priority." I think he knows budgets; we'll test that theory; that member will know that all the Shakwak funding this year is recoverable funding, so consequently that's not a choice for us. But if he wants to say instead that we can put money from, say, the CAP program or any of the other $20 million of previous commitments that were made by the previous government into a school or another project, then let him say that. We will debate that proposition. But come clean if you're trying to make the proposition that this budget can do a lot more than it's doing right now.
The proposition has been made by the Leader of the Official Opposition that the Yukon government should spend less on internal government operations. We are spending a whole lot less on internal government operations even though, I submit, that we are still having to carry out many of the commitments from the past in terms of systems development, computing systems development - there are all kinds of them. We couldn't cut them off midway through for fear that we would have lost all the investment that was made before. But we've still cut back in that area by 25 percent.
So, Mr. Speaker, the members opposite suggest that we should be following the federal government lead. Well, following the federal government lead meant a lot of cuts to programs, a lot of cuts to services, a lot of cuts to non-governmental organizations - Yukon NGOs, Yukon services. Not one criticism out of the members opposite. We table a budget that meant no cuts to NGOs; lots of criticism from members opposite.
If the Liberals - and I'll expand on this point later on - later on, after all this time, after having voted for Yukon budgets in the past that had tax increases, cuts to government wages, et cetera, et cetera, cuts to the NGO's - they voted for those budgets - and they vote against budgets that don't have tax increases, don't have cuts to the NGOs, returned to collective bargaining - then I know where the allegiances lie. They will say in spades what they believe in.
Mr. Speaker, if we follow the federal model in terms of how to treat organizations that we fund, then presumably we would stabilize funding - for example, the CBC's - only after having cut it to shreds. Then we would stabilize it. So, presumably, if we felt that we wanted to rearrange priorities, which is what it's all about both for the Yukon government and the federal government - it's priorities - you can either make tax expenditures for the banks, which don't pay any taxes, and let them rack up record profits in this country, or you can cut social services to people. You can cut the YES program, you can cut CBC, you can cut the Signpost Seniors, you can cut any number of people. You have a choice. It is a question of priorities, but to try to maintain that theory - intellectually and honestly - and apply it only to the Yukon government is grossly unfair.
A lot of the services, Mr. Speaker, that we have referred to have been funded, historically, jointly by the Yukon government and the federal government, and there have been many cases where the Yukon government, in the face of federal cuts - this is by the previous government and by the government before that - have maintained its level of expenditure.
Now, has the Yukon government paid its share? I would argue yes it has, as a government, as one spending centre in the federal system. Has it paid its share? I would argue yes it has. That may be well-disputed by the Liberals opposite, but I would argue that it has. I would argue that it has paid more than its share of the provincial expenditure. While the direct transfers to the provincial governments were five percent, ours was seven percent.
And to argue that we simply get more money per capita than other jurisdictions is not a fair argument at all. We are a small, as I mentioned before, caretaker population with big responsibilities.
Now the members opposite have tried to make this case that the formula financing transfer has gone up. It has not gone up. Don't say that it's gone up because it's not gone up.
When we get a devolved program from the federal government, that does not give the Yukon government more discretionary spending authority to do things with, we're not hiring more employees into the Government of Yukon. We're taking them from the federal government. We're assuming that responsibility.
Some Hon. Member: (Inaudible)
Hon. Mr. McDonald:
No, I didn't. No, I had made the argument about operation and maintenance spending. You're wrong. The Member for Riverdale North typically is wrong. His information is typically wrong. His conclusions are wrong. Nevertheless, the members also account for the fact that the Canada health and social services transfer, which the Leader of the effective Opposition is saying -
Speaker: Order. I would ask the member to refer to the members opposite by their appropriate title.
Hon. Mr. McDonald: Okay, Mr. Speaker, I agree with you. I agree. I'm sorry. I was trying to share your liberal vision that they were the effective Opposition rather than the Official Opposition, but we've all agreed that they'll be the third party and I'll have to return to their old nomination. Sorry about that.
The proposition in this ill-fated amendment, which is part of the Liberals' argument, suggests that the federal government, in the face of severe restraints, has provided stable, predictable and sustainable programming for health care and social programs, and that they've maintained their commitment to young people, to seniors, First Nations people.
Point of order
Speaker: Order. The Member for Riverdale North on a point of order.
Mr. Phillips: Yes, Mr. Speaker, I recall clearly a few moments ago that the amendment that was presented was ruled out of order and the member is going on and on speaking about that particular amendment that was ruled out of order. So, if it was ruled out of order, Mr. Speaker, then he should get back to the main amendment.
Speaker: The Government Leader, on a point of order.
Hon. Mr. McDonald: Mr. Speaker, the argument that the Liberals were making in debate was completely consistent with the amendment that they read out. So while they tried to propose this particular amendment, the Speaker quite rightly ruled that we cannot debate the amendment and vote on the amendment. But, this is very consistent - in fact it is the argument that the Liberals were proposing. So, I'm responding to their argument. That's what I am doing.
Speaker: I'd rule that the debate is in order because it addresses the main motion.
Hon. Mr. McDonald: I've paved the way for others.
Mr. Speaker, I will return to this point and close on this point. The Liberals are suggesting that all these responsibilities ought to be considered Yukon government responsibilities and the Yukon government should simply pick them up. Any NGO that walks through the door, they should fund. That wasn't an NDP campaign commitment. We promised to provide stable funding for NGOs funded by the territorial government. And we're doing it. We did not say that we were going to provide stable and increased funding for everybody's NGOs - for federal commitments - and any time the federal government abandons the field, we will take up responsibility because of what it says in the Yukon Act. I don't believe that the Yukon Act compels us to take full responsibility in all those areas. I believe that both we and the federal government have acknowledged that we have a financial commitment in all the areas that the leader of the third party in the House has identified in his motion and has acknowledged they share.
Mr. Speaker, I support this motion absolutely. I support this motion completely. I believe the arguments that have been made by members opposite have no credibility whatsoever. They're self-serving apologists for the federal government.
Mr. Speaker -
Speaker: Order. The member has two minutes remaining to complete his remarks.
Hon. Mr. McDonald: Thank you, Mr. Speaker. I'll have to complete them later on tonight.
I have a lot to say about some of the comments made by the Leader of the Official Opposition. Some of them I agree with, and I would like to put on the record that I do. Some of them I disagree with, and I'd like to equally clarify where we differ in opinion. But I will speak tonight, and I'm hoping that everyone will be listening with bated breath.
Mr. Speaker, I consequently support the motion and will indicate that, where the Yukon government feels it has a responsibility - where it's historically had a responsibility - we'll do everything in our power to maintain our commitments. We are not in a position to pick up the responsibilities of other governments when they choose to abandon the field.
So I support the motion, and I wish that at least more than simply the government side will support it.
Mr. McRobb: Thank you, Mr. Speaker. I rise in the House today to protest the federal Liberal cutbacks and offloading of services to the people of the Yukon. The offloading of these services will have a significant impact in areas of critical importance to the health and well-being of the Yukon, and in particular the outlying communities.
Our most important resource, our youth, will feel the effects of the actions of the federal government, as will our elders, First Nations and non-governmental organizations. These services, some of which have been in place for a number of years, have left a void within the Yukon. The federal government has raised expectations in the Yukon for the continuation of these services. On that expectation, positions have been created within First Nation communities, and individuals have been trained to provide these services for which they no longer have funding.
This has and will continue to put substantial pressure on our government to pick up the pieces and fund those services once provided through the federal government, while cutting our formula financing by $19.7 million in the 1996-97 year, and each year thereafter.
Yukoners expect that the Canadian health and social safety net will be preserved.
Mr. Speaker, one such program no longer provided as of March 31st, 1997, is the Canada drug strategy. This program has funded many projects throughout the Yukon, including the Youth Empowerment and Success, which, without financial help from other sources, could see the demise of the youth facility in Whitehorse.
The Canada drug strategy has also provided funding through proposals from the First Nations for building healthier communities. Projects often included training and jobs in an area of critical priority to communities and First Nations. Wages for youth workers, support group facilities for youth, and education and awareness of alcohol abuse are examples of projects funded through the strategy, all of which deal with the devastating effects of alcohol and drug abuse in the Yukon.
Mr. Speaker, the federal Liberal government has forgotten our youth.
Another program that has had a significant impact on the Yukon is the economic development agreement, most of which expired on March 31st, 1996, except tourism and small business support, which expired on March 31st, 1997.
This program funded economic development initiatives in planning for communities throughout the Yukon. Many First Nations and municipalities accessed the funding, which allowed for the much-needed position of economic development officers in the outlying communities. This has been a devastating blow for many First Nations that are looking at self-sufficiency through economic initiatives. In addition, many municipalities filled the void through this funding agreement. In the Kluane riding, the Village of Haines Junction received funding in past years for an economic development position. The officer had important responsibilities, given the potential for tourism and economic activity within the Kluane region. Although the demand is still there, the funding isn't.
This is yet another example of raised expectations resulting in added pressure on our government to pick up the cost of economic development officers in Yukon communities.
Mr. Speaker, these are only two examples of federal cutbacks, or offloading, and yet you can see how this has hurt the most vulnerable of people in the Yukon. Other examples of offloading include cuts to French and aboriginal language programs, emergency measures, cooperative education, legal aid, Arctic environmental strategy, green planning, and many more, too numerous to mention.
It is obvious how the cutbacks and offloading is hurting the young people, elders, First Nations, single parents, social assistance recipients and other low-income Yukoners.
The Champagne-Aishihik First Nation has indicated that the federal government expects them to take on much more responsibility with less money.
Mr. Speaker, I submit that the federal Liberals have neglected their duty and have retreated from programs that address social needs by attempting to offload responsibilities on to other levels of government.
In conclusion, Mr. Speaker, I urge all members of this House to support my colleague's motion and unite in sending this message to the Government of Canada, to work with the Government of Yukon, and to stop the offloading and restore funding to programs and services that address the serious social needs of our communities. Thank you.
Hon. Mr. Fairclough: Thank you, Mr. Speaker.
I appreciate the opportunity to speak in support of the motion put forward by the Member for Whitehorse Centre, and I intend to keep my comments very brief.
In this country, traditionally, governments have been organized to meet the needs of people, and people have historically given the governments the mandate to develop programs to meet their needs.
Over the course of this century, this led to the careful construction of a social safety net, which included universal health care, old age pensions, education and a range of programs to help the less fortunate among us.
Over the last number of years, the net has become increasingly tattered, universality is a threatened concept and Canada has retreated from the many areas, which it once set national standards.
As more and more people slip through the holes in the net, they have turned, in increasing desperation, to other levels of government for help, and many of the promises once offered by Canadian society have been broken.
In recent years, the Government of Canada, and Canada's relationship to the citizen, has taken a new and disturbing pattern. At the same time that cutbacks continued and services were scaled back, Canada has developed a practice of announcing new programs and new services that appear to respond to identified public needs.
Promises are made, expectations are raised, the money flows for a little while and then the programs are cut. People who have been helped are left abandoned.
Mr. Speaker, in speaking to the motion on domestic violence last week, the Member for Riverdale South noted that one type of family violence was the repeated making and breaking of promises.
It seems to me that the funding policies, which are being followed by the current Liberal government, are dangerously close to doing just that kind of violence, and that we think of all Canadians as making up a kind of family.
Mr. Speaker, my colleague has spoken eloquently on the federal government's failure in a number of areas, and I'm going to confine my remaining comments to highlighting just a few examples which impact the areas for which I am responsible.
As the minister responsible for Yukon Housing Corporation, I'm aware of the impact of the federal funding cutbacks to social and seniors housing. The Canadian Mortgage and Housing Corporation, or CMHC, used to be the primary federal instrument in this area. It is now a thin shell of its former self. In the 1994-95 fiscal year, CMHC ended all funding of construction of non-profit housing. Major senior housing developments, such as the Closeleigh Manor, Gateway Housing and Cyr's Place could never have been built without the assistance and contribution from CMHC, nor could the Thomson Centre. I doubt that there are any members in this House that would deny that these facilities met real and important human needs.
Courtesy of the federal Liberal government policy, our ability to meet future needs will be severely limited. People who are anticipated to be accommodated in their old age are now questioning their ability to remain in their own houses, and will have their expectations lowered. In the current fiscal year, CMHC is capping their contribution for the upkeep of existing social housing stock at 1995 rates. This means that the Yukon will be picking up the tab for the shortfall, and its ability to meet new housing needs will be limited.
Mr. Speaker, Canadians, for a long time, prided themselves on a healthy, natural environment. We all believe that we have a right to expect a safe place to live. Several years ago, the Government of Canada initiated a major program to ensure that contamination, which occurred over many years of its management of the north, was identified and cleaned up. The Arctic environmental strategy identifies sources of contamination in dozens of contaminated sites in the Yukon and began their clean-up. As of yesterday, the program, like others before it, ended, not having completed its task but having started on it, raised expectations and then took them away.
The final program that I'm going to touch on is the Canadian drug strategy. Initiated a number of years ago, this program funded a number of community-based Yukon efforts to combat the program associated with alcohol and drug use.
Active and involved members of this community invested a lot of energy and imagination to help free themselves of a crippling addiction. I have no doubt that many people were helped. The funding of that program stopped flowing just two days ago, but it did not stop because the problem which it sought to address was solved. The problems remain and many people requiring help will not have the same resources to assist them. A promise was made and a promise was broken. Anyone in the Yukon would not have to look far from their daily life to see evidence of breaches of the faith by the Government of Canada.
I will be supporting this motion and encourage my colleagues in the House to do the same thing. Thank you, Mr. Speaker.
Ms. Duncan: Thank you, Mr. Speaker.
I would like to begin my response to this motion by refreshing members' memories with a little political science 101: the Canadian political system environment structure and process. In order to know where we're going, we have to know where we've been.
I'd like to look at the federal/provincial financial structure.
The character of any system of public finance depends largely upon the nature and extent of the role government is expected to play in the lives of its citizens. That's a very important point. In 1867, when this country was formed, the role of government was perceived in terms of rugged individualism. This was the heyday of the philosophy of laissez-faire and the best government was judged to be the one that governed least.
The bare minimum of governmental intervention in the life of the private citizens in this period included primarily the provisions of national security, including defence, the administration of justice, and the promotion of national economic development through a few essential public works. That was the environment in which the original federal provincial financing structures began.
Until 1962, the federal provincial tax agreements had been based on the principle that the federal government should levy the taxes and collect the revenue and give the provinces a percentage. The unfortunate consequence of that is that big, bad Ottawa was the taxing government and the lucky provincial governments got to be the spending ones.
The arrangement by which the provinces and the federal government share the tax revenues is as complicated when this tax was written as they are now. The basis, however, on which equalization transfer payments are calculated has been elaborated and made more equitable, and there have been many more joint programs. The federal government is moving in the direction of handing the provinces the responsibility for maintaining programs, along with additional revenue sources to meet the needs.
That was then; this is now. Public expectations of governments have changed. Federal-provincial funding arrangements have changed. Some of that change has been more gradual. We, however, still experience - and as evidenced this afternoon by the several hours of debate - the push-me, pull-you of federal-provincial financing arrangements. The bottom line is that the Government of Yukon receives a substantial funding arrangement from the federal government.
Let's just talk about that for a moment. Transfer payments to all provinces and territories have been reduced. The average reduction is approximately 11 percent. Yukon transfer payments were cut by four percent. Transfer payments have been reduced from $320 million in 1994-95 to $306 million in 1997-98. That reduction is $14 million. Total revenue in this year's Yukon budget is $447 million.
We can go on and on and on, as some members have, about the financial arrangements between the federal government and this government. The average Yukoner, however, is not going to sort out who pays what, even if they are listening or happen to be reading Hansard, or if they're studying political science at Yukon College.
The average Yukoner, the average Canadian, has a very strong conscience. We, as a society in future, and in future political science texts, for that matter, will be judged by how we treat the poor, how we treat the sick, how we deal with the less fortunate and, ultimately, when we are old - as we are all rapidly aging, as has been pointed out by my colleague from Riverdale South - the judgment will come on how well we've raised our children, because they will be looking after us.
And governments, all governments, whether they're federal, provincial or territorial, or municipal, are ultimately, of course, judged by voters.
And since the focus this afternoon seems to be judgment of the federal Liberal government and the Liberal government performance in looking after our health care, our poor, our children, I'd like to focus on a few of the facts.
When the federal Liberal government took office, Canadians - all Canadians - knew that tough decisions and fundamental reforms were required. They didn't want tinkering, they wanted solutions. They wanted a plan and they wanted the government to stick to it. This government has done that.
When the federal Liberal government took office in 1993, Canada's fiscal mess was jeopardizing the very future of cherished Canadian social programs. More money went to bankers than to social programs and the prospects weren't very bright.
The federal Liberal government has taken steps to save Canada's social safety net. There has been reform to all aspects of that social safety net, putting it on a sustainable basis for the future - not just as a birthright for this generation, but as a legacy for future generations, and that progress has continued.
Let's talk about some of the reforms to the social safety net. The employment insurance was designed to do a better job of helping unemployed Canadians get back to work. That was the whole object.
Let's talk about health care in this country. The federal Liberal government, following up on the red book commitment, the national forum on health was established in October, 1994. It wasn't just a make-work project for unemployed or underemployed individuals, it was an arm's length advisory board to the federal government. It has 24 members representing all regions of Canada from diverse backgrounds.
All of the members have been recognized for their expertise and experience in the field of health. Their report offers strategic advice on how to improve the effectiveness of our health care system, and I don't believe that any responsible member of this Legislature would deny that Canada's health care needed a serious, hard look.
We have, after all, one of the most expensive health care systems in the world. Part of that could be the medicalization of the birthing process, but we don't want to get into the midwifery discussion this afternoon at this point, especially as it's a cost-saving measure for this government.
Some Hon. Member: (Inaudible)
Ms. Duncan: Well, we on this side could deliver.
The resources that Canadians invest in health care could be, and should be, used more effectively and more efficiently. Health care systems can be improved through change. We cannot be afraid of change. Interestingly enough, I was just in my office and noted this thought: courageous risks are life-giving; they help you grow. I think that's important. Growth is important to everyone.
The report, incidentally, strongly urges partnership and collaboration with the partnerships and with other Canadian governments. This national forum on health made a number of recommendations to improve the health care system and spend our health care dollars more efficiently and effectively. I would remind the member opposite that the 1997 federal Liberal budget provides $300 million over the next three years to implement key recommendations of that national forum.
Unlike some members in this House, I was present in the Yukon when Yukon medicare was instituted, and it's a proud legacy that we have.
As we are rapidly aging in this House, given the advancing hour, let's talk about the seniors' benefit: a new seniors' benefit created to better target the assistance to seniors most in need, without affecting current seniors. You don't see any older people, pensioners, protesting on Parliament Hill over this budget, do you?
The government recently announced a federal-provincial agreement that will ensure the sustainability of the Canada Pension Plan for this and future generations, making Canada the first major industrialized country to secure its public pension system for the 21st century. This government, incidentally - this federal Liberal government - is also taking steps to make it easier for Canadians to contribute to charities and to support the valuable work that they do.
Mr. Speaker, those are some of the facts. Every member of this Legislature seems to think they have the right or, in some cases, the left, version of the facts. We've even seen righteous indignation in this House this afternoon. It doesn't help the debate. The absolute reality is that there is a financial cost-sharing arrangement between federal-provincial and federal-territorial governments. The absolute reality is that this government has a multi-million dollar budget and a responsibility to Yukoners. We all have a responsibility to Yukoners in looking at that budget.
There was a politician present at a federal campaign who, with his absolute very best campaign voice, looked at his competition and said, "You had a choice." The members opposite had choices when they constructed this budget - make no mistake. They have choices, and Yukoners are asking them to make the right choices.
I do not support this motion. It is an abrogation of this government's responsibility - the responsibility to make the right choices with the dollars that we have. I would urge all members to think not solely of their political futures or non-futures, but to think very, very carefully when they discuss this budget, because each of us has a choice. We are expected on behalf of our constituents - Yukoners - to make the right choices. Supporting this motion isn't the right choice.
Hon. Mr. Harding: Thank you, Mr. Speaker. I will be very brief. I'm absolutely entranced by the Liberal arguments that they've put forward today. They have used the biggest jumble of contradictions to somehow lay out a weak defence for the impact the federal offloading has on Yukon citizens.
Mr. Speaker, it's not my interest to protect the Yukon government in terms of finances. It's to illustrate and to show Yukoners just how impacting the decisions that have resulted in such serious offloading to the Yukon have on Yukon citizens and the services that they have come to know and expect, and that they use to try and help them make a better social and economic framework in this territory and enjoy a better quality of life.
Whether that's health care or First Nations services, or whether it's organizations like YES, where the federal government decides to throw out a few bucks to raise expectations, only to dash them some time later. And, Mr. Speaker, I give the Liberals credit, you know. I'm not as concerned about their standing in the polls as the Liberals opposite. I'm more concerned about what they do and its impact on Yukoners, but one of the things that Paul Martin has done very creatively he has learned a technique of announcing a bunch of things in a budget but not being too specific - just laying out a bunch of cuts and letting them trickle down to the provinces and the territories some time later, so that the provinces and the territories face the protests and the consternation. And there are not as many protests on the grounds of Parliament Hill, as the member who just spoke alluded to, because of that fact. The people are not told what decisions are being made. They are insidiously crafted within the budget so that they affect them a year or two later.
Mr. Speaker, when I remember watching Brian Mulroney in the Parliament of Canada defending free trade and when I watched him defend small cuts to the unemployment insurance system and when I watched him defend the measures he took with regard to federal employees and collective bargaining, I saw the Liberal Opposition, led by Jean Chretien, say a lot of things. The GST, of course, was another one.
Mr. Speaker, constantly they oppose those cuts as Draconian but what have they done with the unemployment insurance system? What have they done? They've taken it, they have now announced that the payroll tax will be implemented on the citizens and taxpayers of this country to the tune of $5 billion a year. So they are now saying that, rather than putting those monies back towards workers who have had their jobs curtailed or are facing seasonal employment opportunities, that money will not go towards insurance, as it was originally intended when it was envisioned, but it will go towards general revenues. I think that is fundamentally wrong. If they want to have a payroll tax, they should just say that. They shouldn't try and craft it in the guise of unemployment insurance.
Mr. Speaker, we have heard the Liberals in this House today stand up and say that Yukoners shouldn't whine about cuts they've faced in health care and education, the impact that's having on students at the college. And we've had them say that somehow, on a per capita basis, we should be thankful for the money we're getting. To compare us to other provinces with our small population is incredibly convenient logic. There's a reason that we're funded in this way.
It's because we are a very small population in a large land mass, and we are given a formula by the federal government, initially, to provide services, a basic level of services to all Canadians, and to provide for economic development to hopefully expand our opportunities and, thus, our population at some future point. It's hardly an analogous situation to compare us to other provinces and try and make that some justification.
But at the same time the Liberals in this House are defending their counterparts in Ottawa on gun control and everything else, Mr. Speaker. They're standing up in this Legislature and asking us for millions and millions and millions of dollars of expenditures, over and above the money that we've already spent. Then they stand up and make some cockamamie argument about how we're in a deficit position in the Yukon. They want it six ways from Sunday: left, right and centre.
Mr. Speaker, it is just not possible. We can't spend, spend, spend, spend, spend money we don't have, and we don't have money because the federal government has offloaded a lot of responsibility to this territory.
The Yukon Party arguments about O&M are equally bizarre, in the sense that they're somehow saying that by taking over devolved programs, and thus employees and responsibilities, that's an added O&M cost that should be expected. I don't know how they can possibly carry that argument.
Mr. Speaker, the federal Northern Affairs department has 300 employees here performing some role for the federal government. If we take over responsibilities, it only follows suit that some of those employees would fall our way, and thus there would be an increase to O&M.
To take over the responsibilities and not fund them, and try and fund them out of our base budgets, would be ludicrous given the small population we have here in the territory.
Mr. Speaker, the federal Liberal government is master at creating expectations and then dashing them. I think that that is the problem in terms of its impact on Yukoners. It's not about the impact on this government, it's about impact on the citizens - seniors, First Nations, youth.
And I think that it's fundamentally wrong - their approach. And to hear the local Liberals stand up in this Legislature day after day and ask for $1 million - Grey Mountain School. Of course, they were in the bidding war on the bridge in Dawson and Grey Mountain School, and they had oodles and oodles of campaign promises. They were going to fix everything under the sun, and Mr. Speaker, to have them stand up today and defend the offloading is a totally contradictory proposition.
So, Mr. Speaker, I would just say that it wasn't us who got in the bidding war in the election campaign. It was the two parties opposite. We stayed out of it completely, and we felt that was a responsible course of action. We put forth a platform that we know to be livable and we know to be attainable, and didn't include big projects for schools. Just the other day, I heard the Liberals on the radio criticizing the Yukon New Democrat government for not building a bunch of schools in rural Yukon. Mr. Speaker, that's tough to do when you're facing the offloading and the commitments of the previous Yukon Party government to the tune of $20 million, and increased O&M for Beringia and the Tourism downtown office building/ visitor reception centre.
Some Hon. Member: (Inaudible)
Hon. Mr. Harding: The members opposite are heckling over about commissions. They haven't gotten it through their heads yet what a cost charge-back is to ECO. They haven't understood yet that it's not an additional cost to the Yukon. They haven't understood yet that they were prepared, in one area of one commission alone, to offer $1 million stumpage subsidy to the loggers in the Yukon and to fly in a mediator to settle this thing from the United States. They haven't figured out yet, Mr. Speaker, that I had an oil and gas branch, an energy branch, a forestry branch in Economic Development, with no political point person, no political direction from the previous government.
What we've done is to actually change that, and at no extra cost put people who have a political accountability chain in charge of the system. They just can't grasp that, but, Mr. Speaker, why should that surprise me?
The Yukon Party was kind of a hill-billy government and they weren't really interested in anything forward looking or of advanced the Yukon in any way. It was sort of Jed Clampett and friends, and that's the reason they're on that side of the House and that's the reason we're over here.
Thank you, Mr. Speaker.
Mr. Phillips: Thank you, Mr. Speaker. It's always indeed an extremely great pleasure to speak after the Member for Faro.
You know, when this motion was put forward today by the Member for Whitehorse Centre, I read the motion and I said, "I can support that." And then I listened to the debate from the members from the side opposite and I thought, "Boy, I can't support that."
It's been an interesting day. It's been kind of like watching a tennis tournament, with the Liberals and the New Democrats with the ball going back and forth all day and exchanging nasties. Up until the Government Leader stood up, who was the nastiest of them all, we were sort left out of it and it was kind of fun to watch, but now we're in it. So, I guess I'm going to speak about the motion.
I have a tendency to agree with the main body of the motion, primarily for what it says. Mr. Speaker, I will be speaking briefly on the Liberal amendment that was ruled out of order, but I'll be tying it just about as close as I can as the Government Leader did to the debate. So, I'll make sure, Mr. Speaker, that I follow your ruling and your order there and it'll be tied as close as I can get it.
Speaker: Order. I'm going to clarify the ruling that I made on the amendment. The amendment was ruled out of order because it was contrary to the main motion. That's consistent with parliamentary procedures across this country and, indeed, throughout the Commonwealth. That's the reason for the ruling on the amendment.
The ruling on the amendment was not about whether or not it contained the same subject matter as the motion. For that reason, debate on the subject matter that's in the amendment is consistent with the subject matter within the motion.
Mr. Phillips: Thank you, Mr. Speaker. That's what I was saying, that I'm just going to tie it to the matter that we're discussing. That's fine, Mr. Speaker.
It's been an interesting afternoon. I've listened to the comments from some of the members opposite, and I found the comments from the Member for Watson Lake rather interesting. A couple of times now in the House, the Member for Watson Lake has talked about the right-wing parties on this side of the House - the right-wing Liberal government in Ottawa that is slashing and burning social programs, and the right-wing Conservative party on this side who doesn't care about people, as well.
You know, Mr. Speaker, I've talked to a couple of people in Watson Lake and passed on some of the comments that the Member for Watson Lake has said in the House about various things and support for the budget. The reaction I got was, somebody said "That couldn't have been our Dennis that said that." I said, "No, that was your Dennis that said that." They said ...
Mr. Phillips: ... "Our Member for Watson Lake -
Speaker: Order. Order please. I would ask members to refer to members opposite by their titles and not in a personal manner.
Mr. Phillips: Mr. Speaker, I was just talking about a quote. Someone said to me, "That's not our Dennis." I wasn't saying that was Dennis. I referred to him as the Member for Watson Lake. I think if we check the record, it's clear it's the Member for Watson Lake, but the folks in Watson Lake like to call him "our Dennis".
Speaker: Order. The reason for the ruling on... again, I'll make reference to Beauchesne, I believe it's section 484 that talks about referring to members by title rather than in a personal manner. Of course, there's been much discussion in the last number of months in this territory about that - about personalizing debate - and it's for that reason that I intend to rule on these matters.
Mr. Phillips: Thank you, Mr. Speaker.
Well, to continue on with my story, I will use the terminology of the Member for Watson Lake. The individual said that the Member for Watson Lake was the most right-winged individual that they'd ever met, and it appears, Mr. Speaker, that what's happened is the New Democratic Party has taken this member out of the chicken coop and clipped his right wing, and clipped it right down to the armpit because he appears now to be espousing the values of the ultra left wing. Some of his constituents are concerned about their Member for Watson Lake who has somewhat changed in his philosophical thinking almost overnight. One said -
Speaker: Order. Order please.
Mr. Phillips: Thank you, Mr. Speaker. I seem to be hitting a touchy tone over on the other side, but the one individual said that it could be that the air quality problem has not been solved yet in the government buildings and maybe in the members' offices and that is the reason why he is sort of changing his tune on many of the things that he used to talk about in the past and the views he had in the past about governments and how they should spend and where they should spend, because he certainly has turned a major corner there.
Mr. Speaker, the motion that was put before us by the Member for Whitehorse Centre talks about the federal government neglecting its duty as a national government by raising public expectations of funding for support programs.
I agree with that concept and I think, unfortunately, our Liberal colleagues have missed the point of the motion. They've steered the motion around in another direction by way of their non-allowed amendment that basically says that it's all about the transfer payments and that we've been funded very well and that everything is fine.
This motion isn't about the transfer payments at all. I guess it's partly about the transfer payments and the cuts to the transfer payments, but primarily it's all about the programs, and the expectations that were established by some of the federal programs.
Now, I can think of a few that come to mind and some have been mentioned here today.
The Victoria Faulkner Women's Centre used to be funded - I think they got about $20,000 at one time from the federal government and they're down now to $5,000 from the federal government, and we had to pick up some of the funding. We maintained our funding in that case and actually enhanced it with some direct project support at the time. I know that the new government has extra money in the budget where they're having to pick up the cost of funding that organization, as well. They do good work.
The Yukon College: again, that's another program that the federal government was funding for quite some time, and when they pulled out, they pulled out $900,000. I think we came in with about $500,000 of that the first year to try and maintain the funding to provide the program that was ongoing.
Legal aid was another program that the federal government all of a sudden ... In fact, I can remember going to a justice ministers meeting, I think in Ottawa. It wasn't just the Yukon. The Liberal Party tried to associate this particular motion with the money the Yukon government gets. In fact, I know that the members on the other side that have attended conferences with other ministers across the country know that every other provincial and territorial minister is as concerned about this kind of thing as we are. Every other one. This isn't a Yukon issue. This is a national issue that's impacting on the Yukon in a big way.
So, legal aid was an area where we met with Allan Rock, our famous guy from Ottawa, the fellow who's going to take away all your firearms, and I'm going to get to that in a few moments. This particular individual met with us, as justice ministers, and every one of us stood up at that meeting and said, "This legal aid thing is becoming a real problem. We've got all these expectations. You started all these programs. We came in with equal funding and now you're cutting back. We have staff that are working." And the problem with most of these programs, Mr. Speaker, is that the Government of the Yukon was the delivery vehicle for the program.
And so the people on the front lines, the people that we were serving, the people that needed legal aid, or the people that needed the native courtworker or Victoria Faulkner Women's Centre, felt it was our program, and now the feds have backed out silently and we've had to pick up the pieces, and I think that it is a bit unfair.
Even to go a little further, there was one particular program that I became very upset about, and that was the school counsellor in Dawson City. A few years ago - I think his name was Jim Johnson, the individual that was involved - they had a drop-out rate of about 30 or 40 percent. It was way up there at the higher grades, and they brought in Jim Johnson on this pilot project - of the federal government - and they went into the program, and it was extremely successful. The drop-out rate dropped way down. Jim Johnson did an absolutely great job, and the people were really pleased with the results. The facts and figures were there, and we assumed that if the facts and figures are there and the pilot program works well, the federal government would continue to fund the program, and they walked away from the program. We had fights with them every year. I think it was debated in this House for two or three years about funding for that program, and I think they're gone from it now. I think we picked it up. The Yukon taxpayers picked it up.
The forestry discussions went on, and I know the Member for Watson Lake, the right-wing socialist from Watson Lake, said that nothing was done in forestry. Well, Mr. Speaker, there was a lot of work done in forestry with respect to devolution of the forestry resources, and then what happened was that just before we got the transfer, the federal government decided to cut all the staff and reduced the amount of money.
And it would have downloaded that particular devolution process on to the backs of the Yukon public. We still would have had to fight forest fires, we still would have had to manage the resources as they had before, but we'd have to do it with about half the money, and we said no. And, I think the government on the side opposite is going to say no if they take the same approach again, and so they should.
First Nations Tourism Association was funded through an EDA organization, and now the Government of the Yukon is having to pick up $60,000, I think, in this budget, because the federal government has gone out of it.
Social and seniors' housing has been talked about today, some of the programs that have worked.
Now, I don't particularly blame, completely, the federal Liberal government. I think, as the Opposition Leader said here earlier today, we do have some funding. The New Democratic government in the Yukon has identified its priorities and I think there are going to be programs, whether we like it or not, and we've done it in the past with respect to Jim Johnson, the maintenance enforcement, Victoria Faulkner and Yukon College, where we have stepped in, but there has to be a point at which you say, "No more", because we can't pick them all up.
The problem that I have with the way the federal government is doing it is that it doesn't matter how successful the program has been. They're not interested in listening. The word comes down from I don't know where and says this program is gone. We can make all the arguments in the world of the success of the program and it's gone. Although I applaud the efforts of Mr. Martin in trying to reduce the deficit, I don't think anyone thought that we'd reduce the deficit on the backs of programs that were extremely efficient and programs that work well, and that's what's happening. We're reducing it on the backs of those programs.
Like we've said here today, there's a 40-percent reduction in transfer payments to the provinces and territories and there's a 10-percent reduction in the operation and maintenance spending of the federal government itself. In fact, a lot of the 10-percent reduction in the spending of the federal government itself is in Indian and Northern Affairs up the hill here, which affects us even more. It's payroll up here and people that are going to be affected. So, it really does have quite an effect on us.
NGO funding cuts. We talked about NGO funding cuts. Well, Mr. Speaker, one of the areas that I think has been devastated by the federal government cutbacks is the arts and cultural groups in this country. All of those groups have come to the Government of the Yukon asking for help.
When I look at it as a former Minister of Tourism, and I realize the value that the arts and the cultural groups have contributed to tourism in this country, it's a really short-term gain for the federal government to cut the funding for these arts and cultural groups.
There was some fat in some of the groups and in some of the funding, but the across-the-board approach that the federal government takes with the NGO funding cuts, with the various department funding cuts, is unfair and unreasonable.
Mr. Speaker, I listened today to the Leader of the Official Opposition, and I don't know what's primed him but he's obviously fired up and was quite critical of both parties on this side of the House in his condescending way that he can be from time to time, and I was a little bit disappointed by the style of his attack. He sort of tried to point out to all of us in the House that we are all wrong on this side; the only person that's right is the guy on the left, the Leader of the Government of the Yukon. It's always amazing to listen to the member and how he justifies how everything he says is correct and everything we say is incorrect.
Mr. Speaker, the Government of the Yukon has funding options and can pick and choose and has to make hard choices, and it's all about hard choices. We had to make hard choices when we were in government but, I think they can make more choices than they have made. I think that they should make strong arguments to Ottawa that we shouldn't pick up all of these funding cuts, but I think that there is a role for the Yukon government to play as well.
Speaker: Order please. The time being 5:30, the Speaker will now leave the chair until 7:30 p.m. tonight.
Debate on Motion No. 52 accordingly adjourned
Speaker: I will call this House to order. Order please.
Bill No. 4: Second Reading - adjourned debate
Clerk: Second reading, Bill No. 4, standing in the name of the Hon. Mr. McDonald - adjourned debate.
Hon. Mr. Keenan: Thank you very much, Mr. Speaker.
Tonight I am going to take my opportunity to speak to the budget. Indeed, it gives me great pleasure to be able to stand here this evening and to speak to what I think is a very fine document.
Before I get into the actual nitty-gritty of it, I think I'll take the opportunity to elaborate on some of my feelings of why I am here today, and I do believe that is my right and my opportunity.
Mr. Speaker, since I've had the opportunity to sit in this House for five to six months - it seems much longer at times, and at times it seems much shorter - it has been very much a learning curve for me. I have certainly grown to appreciate the nature of the Legislature, the people that I work with on both sides of the House.
Mr. Speaker, I must say that not all of those experiences have been fruitful. Not all of it has been pleasant. Many times, I have had to sit on my hands. It is a trick my mother taught me when I get frustrated, to sit on your hands so you don't start flapping around making a spectacle of yourself, and many times I have had to do that.
Mr. Speaker, I must say that the buzz words that I have heard here have been antagonistic at best. I have heard all sorts of things from "Show me" - and I think we have for a better way - to "That's not true," to being heckled and jeckled, and I've always tried to take the time to calm myself down and to think of what we are doing.
I'd just like to reiterate what I said in this House just a few short hours ago, that it's going to take a common energy, a common focus, to move forward for Yukon, for the people, for the land, for the water of the Yukon. Not once in my speeches have you heard me say "of one over the other," but "together".
I've heard it said that David Lewis would be rolling over dead in his grave now because of the social attitudes and the social talks that we have said on this side of the House. I do not think that is true. It's not true at all.
I was away from the House yesterday. My apologies, Mr. Speaker. It was due to unfortunate circumstances. I see that people took the opportunity to ask me to resign. That is a defeatist attitude, simply a defeatist attitude. We're hear to talk about the budget for the betterment of Yukon, resource development, people development. I do believe that that is what is incorporated in here. I think it is totally out of hand for people ... Maybe it is not totally out of hand for people, maybe that's the way they were taught.
But, Mr. Speaker, that is not the way that we should be and I caution all people that when you ask for something, a lot of times, you get what you ask for. We should not be asking for something that is ludicrous. We should put some thought behind our words, and I encourage everybody to do that.
Mr. Speaker, I'm a proud socialist. I come from Tlingit/Irish/Scottish ancestry. There are clans in every one of those ancestries of mine. Clans. Socialists. It simply means that people stick together and help one another. When one is down, you pick that person up. You help them out when you can. You apply the rules of tough love. You apply the rules of cruel kindness. You make sure that you have a vision and you make certain that you have values and you move toward those.
Again, I do believe that this document, A Better Way, reflects that initiative. I know that this budget reflects these two initiatives. Mr. Speaker, we are building upon initiatives. We are laying a foundation for the future of the Yukon that is politically driven, value driven by virtues. It is not personality driven by the mere whimsical, "Here I am; I'm such a good-looking person. Take me for what I am." No, Mr. Speaker, we are much deeper than skin deep. I would like to think that all of us are in that manner, but, unfortunately, not all are in that manner. Not all.
This budget is a reflection of the campaign; it is a mirror of our commitments. It is how we will prioritize and carry out... We were given a very difficult job, Mr. Speaker. No matter what anybody says, this has been the toughest budget to put together that I can think of in Yukon's history and we did it with compassion. We did it with thoughtfulness for all segments of society and that is a very difficult job to do, but we did it and we proudly present that budget. Since we have presented that budget, there have been many people who have stopped me in the street and said, "From what you have to work with, I think you've done a very fair and equitable job." That is from the average Joe on the street, not comedy hour, the zoos that others hang around where they can snicker and giggle.
Maybe I should take the time to tell you now, Mr. Speaker, while we are snickering and giggling, so that we can continue to snicker and giggle, why I'm in politics. I must thank the members opposite, the previous administration for encouraging me, David, to enter into politics. Goodness, because without your encouragement, I would never have been here. I would have been where I solely and surely deserve to be, with my people, with my family. But I consider the encouragement that the Official Opposition has given me is certainly reason enough to come into this House. It is certainly funny that I don't see people snickering and smiling now because politics is not a game; politics is a fashion for people, a fashion to work with respect and the values of respect so that we might represent people as they need to be represented. That's what this side of the House is doing. This side of the House is doing that.
When I sat as a chief and a grand chief we agreed to, first of all, the agreements in principle, the umbrella final agreements and ultimately a First Nations final agreement. They were documents of promise, of commitment, of respect to one another on a government-to-government basis.
Mr. Speaker, when we went to implement those documents, I did not see where they were being implemented to the honour and spirit that they were negotiated.
Fortunately, Mr. Speaker, I was one of the negotiators, one of the implementations, at that level of government to government.
Mr. Speaker, I will take the time now to tell you that my vision of government is one of equality. There's the federal government, the territorial governments, the First Nation governments and, yes, even the municipal governments.
I think that based on the values that we have and the road plan that we have developed through the umbrella final agreements, that if people would take the time to read them, to see them, they would see happiness. They would see like climbing a mountain when you get to the top of the mountain, you can look around and see blue skies. You can see the horizon of where we are going and where we should be together.
But, Mr. Speaker, that wasn't happening. Again, I thank the Official Opposition for encouraging me to run for politics, because now it is happening and with the resources that we had to work with well, it's tough decision time, but doggone it, we're making it work.
Pardon me if that's an unparliamentary word.
Mr. Speaker, this document is an act of vision. It's a resource and land use - that's what it spells out and speaks of. It speaks of land use. It speaks of balanced land use. It speaks to mining and the encouragement of it in a sustainable manner, through a development assessment process. It speaks to tourism, it speaks to treating people the way they should be treated.
Mr. Speaker, to me that's not all flowers and spice, but to me that's a reality, that is achievable, and we are going to get there.
It is through this government's platform that we're going to get there. The people have ratified the agreements of land claims, even though it was taken out to them again after it was ratified by the previous administration. But it was ratified by them a second time - much as I must say, at this point in time, Mr. Speaker, as the election in Old Crow proved yesterday. They were ratified again. I take that as a sincere - sincere what? - sincere direction for us to move forward with the documentations that we have tabled.
So, this side is going to move forward with the opportunity that we have. We are not looking at one segment of the economy, the resource segment, we are looking at the traditional economy, Mr. Speaker, the economy that actually preserved Yukon for what it is.
Mr. Speaker, I must say right now that we are no fans of a deficit budget, but we were forced into this position by the previous government, the previous administration. The way we look at it is with the movement that we are doing here now today, it is like planting a seed in the ground. That seed will flourish, and that seed will become a tree, and that mighty tree, with roots and tentacles that go everywhere and spread everywhere, will be a tree that protects us all, based on the values of individualism, based on equality and respect. That's what I read into this budget deliberation.
Mr. Speaker, I encourage all of us to look towards this budget as a bloom. Don't look towards it with defeatism, with propaganda. Let us take the time to admit, when someone is right, that they are right. The people have spoken twice, and we have listened wisely to them. This budget does not put one person or one item over another, as I said. It clearly defines the natural growth of the Yukon, of which people have a desire to see.
Mr. Speaker, I've heard many comments - many comments - and it bothers me to stand here and speak so sincerely to some of them. But it said, "Show me. Show me, Mr. Speaker, where this has come from and what you have done. You have cut the heart out of highway development." No, we have not. We have simply looked at moving forward on a balanced decision-making process, on a balanced development-making process. And that's what this budget means to me and this is what this budget is going to give us, because I know that is what the people want.
This is a quote from my uncle, who once said to me - I have a deep respect for the gentleman; he is no longer here, but it's something I've always maintained since early days and it's close to me - if you watch your pennies wisely today, you'll always have dollars for tomorrow. He did not mean hoard and save, but he meant to use it. Because if you use it wisely it will always be there for you. Well, Mr. Speaker, you can certainly take that principle and apply it to any principle in your life, whether it is spending money, resource development or whatever. You can certainly do it in that connotation. It is a balanced approach.
Mr. Speaker, we are looking at maintaining our social programs. You have heard previously in the day of the tough decisions that we had to make. You have heard the dissent from other people in this room. But I've encouraged people to think as Yukoners and to maintain that line of thinking that is so sincerely Yukon. That is what we came here for, as a people, to live here, to share with certain members of my ancestry, and I do indeed feel so proud to be of mixed ancestry, because I do believe it gives me the enlightenment to be able to speak towards what this budget reflects.
Mr. Speaker, since my election, it was indeed my privilege to tour the Yukon communities. I have not hit all the Yukon communities but I've hit the vast majority of the communities and the message that I was taking was one that I was raised with and one that is reflected in this budget, and that is of working with partnerships at all levels of government, including the municipalities. In addition to that, we are doing the consultation with peripheral users, as I've outlined today. We are looking at a variety of issues and options of services provided by the municipalities that are impacted by the peripheral users. That is in this budget. That is the direction that we are moving towards. We are shuffling things laterally in every which way so that we might get a more efficient government. So it most certainly upsets me when I hear people sitting across the way saying, "O&M is up. You can't blame it on the devolution aspect." Well, that's ludicrous, absolutely ludicrous. No matter how often you close your eyes, you cannot flit away into a different world because at some point in time you must open your eyes to the reality that exists. Again, that reality spoke yesterday.
People are very desirous of working in partnership at all levels and, yes certainly, this government will work to accommodate that, because as I went with a message that message was echoed back to me of working as a partnership. People are very desirous of working together in partnership.
My department will continue to ensure urban housing lots. We have allocated funds for the future country residential lots. My government is prepared to enter into partnerships with First Nation governments, municipalities, the private sector and individuals to expand upon the options. That is the movement that we are going toward. We are looking at every option.
Government is for the people and of the people and should be reflected as such in a decision-making process. Mr. Speaker, all communities are desirous of looking after themselves. They have their own peculiar egoisms - whatever the word might be - they certainly have them. They have their own lifestyles. They are very desirous of having local input into the direction the communities would like to go. I believe that all things are possible if we work cooperatively, if we prioritize the capital projects because, of all the communities and municipalities in the Yukon, one is not really not that much different than the other. They are all desirous of having the same initiatives - skating rinks, some have swimming pools and recreation centres - anything that is like as such.
I think it is up to this government and this government is going to enact a process where we will be prioritizing those capital projects. Again, I reiterate that anything is possible if we can sit down and work together. We should not be the bearer of bad news. We should be making these decisions together so that people achieve ownership and do not look at politics as a game, but the people that represent them with dignity will have the people's mandate behind them, no matter what stripe or political affiliation they have. They will have that behind them.
I received from the communities a very positive message based on trust and cooperation. When I was in Dawson City - and, as you know, we spent a lot of bucks in the last Legislature; the last time we sat, before Christmas - I met with the mayor, council, chief and council and they told me that if it doesn't have a Dawson City letterhead on it, ignore it. I said that is not cooperation. We cannot work in that light. There are different levels of government. I expect us to work together to achieve what the community is desirous of. Again, I reiterate that.
I came from the mayor and council, the chief and council. So now, Mr. Speaker, after my talks with them numerous times, I think we do have the opportunity to work in trust and to prioritize and to look at all things that communities want at their level and to look at the impact of what those projects might bring to them. Whether it's an increase in taxation, or whatever, they will be buying into it and it will be a part of their decision, and they were very pleased to hear that message, because they said that is the first time that they've heard that message of recognition of municipalities, a recognition of First Nations governance, along with an equal territorial government. I am very pleased to see that people are going to work toward that end.
As for honouring commitments, Mr. Speaker, I find it very offensive when people say that we are breaking commitments, because we are not. We have looked at every commitment that we have made, and I really don't like it when people misconstrue and spin-doctor words and make words seem like they are different for their own connotation. We are honouring commitments.
As I've stated in the response to the petition, we are not raising taxes. In fact, we are taking it a step further with our rural service policy paper. We are taking it that much further so people can learn to enjoy what they have, what they want, and be a part of getting what they want, and also to preserve their peculiar lifestyle, because this is the Yukon, the colourful five percent. This is Yukon, and we must have respect for each other.
So, when we embark upon these initiatives, they should be looked upon as credible initiatives. They should be looked on with enthusiasm, because we are going out to speak to the people, to listen to the people.
It might seem ironic that a person with two hearing aids in his head speaks about listening, but sometimes you must really take the time to listen. You must watch their bodies. You must watch their lips. You must listen with your ears open, but if you try hard enough, you will hear, and if you are sincere and consistent enough, you will get the message across. I do believe, Mr. Speaker, that each elected official in this House wants that, that each one of us is elected by the people to represent that, so I encourage us all to look forward to that and live up to that.
They say it's the number-one industry in the Yukon. Let me tell you, tourism is the number-one job creator for the Yukon. Some of us are actually in the tourism business and are sitting here representing our constituents. So, they know how very important it is to us.
We're putting just a few more resources toward the further nurturing of the tourism economy - just a few, but it's certainly a welcome to the people we are working with. We are now in the process of working with regional concepts and First Nation governments to initiate a sustainable economy based on tourism. It pleases me to be able to work with the Tourism Industry Association of the Yukon and to buy them into the decision-making direction of this government. They are most happy to have that message.
It pleases me to be able to work with the First Nations Tourism Association as a meaningful partner, not just talking heads, but meaningful partners and to listen to them as meaningful partners because those people, my people, have been here since time immemorial. They preserved this Yukon for contemporary, for modern-day man and woman. So, we must appreciate that and respect that; that there are certainly different ways of doing things.
You can come to a mountain from many different valleys and because you take a different valley does not mean you're more disrespectful or that you're any more inferior or superior to others. It just means that you're knowledgeable and that you have a proven history of protection. That's what that means to me.
We put resources toward both of these organizations so that we could work as a government and could work seriously and cooperatively with these organizations. Mr. Speaker, what I call that is walking the walk. That's what I call that. We're not just talking. We're talking and we're walking that talk and we're going to continue to do that.
The First Nation tourism conference had people from many places of the Yukon. Guest speakers from outside of Canada, from Hawaii and other places, talked about indigenous experiences. Well, I was certainly encouraged by the level of participation and indeed the initiatives that were brought forth on behalf of the First Nations of the Yukon.
I saw, within that conference, a great desire to work together, and we're going to facilitate that desire. That's what we're here for as a government. I've just returned from Germany and Switzerland in Europe. It's a very important marketplace for the Yukon as a tourist destination.
A significant factor that I learned on that trip is that tourists on holidays wish for a natural experience and that's exactly what we have in Yukon. It includes the land, the water, the people, the ability to get away and see things as they were for many years.
You read in the paper, just tonight, my colleague, the Minister of Renewable Resources, made a presentation last night. He was indeed a hit there because when he gave the message that we are here to work to clean up and to work cooperatively, the ecotourism operators opened their hearts and their minds and came together with him and his department so that they might be able to move forward to preserve the Yukon for what the Yukon is.
That's what the European people want to see: natural splendour. They wish to experience the basic principles, not only in ecotourism, but also in the important heritage of the Yukon. Again, Mr. Speaker, we put money toward the heritage of the Yukon, the contemporary heritage.
Projects such as Rampart House - we've put resources in that so that people might be able to enjoy, not just in Whitehorse, but can I say the word TROY, as I read in the Blues: the rest of Yukon.
Might we be able to look beyond Dawson City? And, might we be able to look beyond Kluane and realize that there is far more to Yukon than those two places and that we can look on a regional basis, so that we might be able to develop Yukon in a sustainable manner, the way it should be and deserves to be developed.
So let us look beyond the gateways of limited vision. Let us look and open up our hearts and our minds to what Yukon has to offer for all visitors.
As we prepare to celebrate the 100th anniversary of the gold rush, our government is taking steps to help broaden the focus of tourism-related activities, such as ecotourism.
Well, I am very pleased to say that we have initiated discussions towards finding solutions to the critical access to Whitehorse from Europe. The Department of Tourism will also spend additional monies in joint marketing initiatives with airlines.
Era Aviation - I spoke to a group of operators at lunchtime this afternoon. People from the travel industry, people from the media of Alaska and I believe there were approximately 20 people there to look from our sister state, I guess you might say, Alaska, Anchorage, the capital city - excuse me, not the capital, but certainly a big city in Alaska.
Era Aviation, a new airline, will begin flights from Whitehorse to Anchorage beginning May the 12th of this year. There are going to be six flights a week. One of the advantages with Era's schedule is that they will be able to connect with charter traffic from Europe and bring those European people to us.
Canada 3000 will again commence flights twice a week from Whitehorse to Vancouver on June the 3rd through September 30th, the peak season. Royal Airlines will continue flights.
So, we're doing what we can to accommodate the tourism business in the industry and to look forward into the future so that we might be able to get airlines non-stop from Frankfurt, Germany to Yukon, to Whitehorse in particular, as a destination.
In the arts community, a small but significant increase of five percent in the annual grant to the Arts Centre has been brought forth. It's small and significant. Maybe to some it's insignificant, but I know the folks that are receiving it think that it is very good news for them. It's definitely good news for them, because for so long they haven't had that. They haven't had an increase and they've felt left out. Well, Mr. Speaker, we're helping when we can, where we can, through careful thought, a well-thought-out approach to governance, and again I stress that governance is for and of the people, not one over the other.
What have we done in Community and Transportation Services? Well, I've spoken previously about developing partnerships with communities and let me say at this time, although we have not increased their grant, we have not cut their grant either. We haven't passed back the negative impact of federal cutbacks as a lot of provinces and territories were forced to do. We swallowed that ourselves. We are not passing the buck. We are receiving the same level of funding. Mr. Speaker, let me clear this up right now, because when I hear it it just upsets me drastically. When we sit down with municipalities and First Nations governments, we are not there to set anybody up for failure. We are there to help out in a meaningful way, and we are going to do that in a meaningful way. When we transfer authority, we're going to transfer the resources that will adequately help them, and they will be done in a negotiated process. They will not be shoved down anybody's throat. It will be done in a negotiated process and it will be accepted by all people.
Mr. Speaker, if we can read between the lines, which I'm sure that we all can, that is what is reflected in this document I hold before me. We are creating a level playing field. Indeed, it gives me great pleasure to be able to stand here and say that our government's first priority is completing land claims and self-government agreements. As a former chief and grand chief and vice-chief of the Yukon First Nations, it swells my heart with pride to know that I can represent the territorial government at this level and know that they are another government at the same level as we are. Indeed, maybe their jurisdiction goes further than ours, but we are finishing that so that there will be certainty to them and there will be certainty to all Yukoners and then we can march forward the way we want to, the way we are promoting partnership and focus on the meaningful, sustainable development of the Yukon and its land use. A level playing field. Certainly, in the last few years that has been absolutely ludicrous and unheard of. It has not happened, but it is happening now.
We have taken initiatives to ensure that the Shakwak project, which was initiated by an NDP government, will be concluded to its original concept. It's going to take work. It's going to take a lot of work to make that happen. My Government Leader and I have sent letters to all persons that are affected, that could influence it. We are looking to keep pushing this initiative so that we might be able to work with it. We have the Alaskan Legislature's support on this. Mr. Speaker, I feel confident that with, togetherness and by working together, we might be able to move forward and finish the Shakwak project - t
his year, $11.2 million.
As I am speaking about partnerships, let me tell you that I have been to Yellowknife to speak with my counterparts in the NWT. I spoke with them about maintaining quality of road service. I spoke to them about joint-marketing tourism. We have been to Skagway. We have met the Mayor of Skagway. We spoke about the importance of the transportation corridor - a corridor that not only affects Yukon and resource development in Yukon - well, at least I am not as long-winded as my counterpart. I appreciate the honour - and the importance of it.
We are looking to the future. We are looking 30 and 50 years down the road, so that we might be able to develop infrastructure that is applicable to what we want. We are going to do it. We are going to do it in partnership, in tandem, with our neighbours:the Alaskans and the Northwest Territories. We are talking about a solid working relationship that will define sustainable development throughout the Yukon.
Mr. Speaker, $4 million on the south Alaska Highway; $2.7 million on the Campbell Highway; $2.5 million for the Top of the World Highway; the South Access contribution of $3 million to the City of Whitehorse; continuing with the Whitehorse sewage treatment of $1.3 million. Is that peanuts? Is that cutting the heart out of anything? Heck, no. That is called good, considerate balance. That is what that is called. And, doggone it, it's working.
We are creating jobs through capital works, road and community facilities, while working with Yukon people to develop long-term plans for future years in partnership again. It gives me such great pride to say that we can do these things with just a little bit of ingenuity, a little bit of flexibility in our own minds - if we have to stand here and massage it until we do. We have taken the time to do it and we have come up with a very good budget, in my mind, and no tax increases.
As I look around, I can see I am putting people to sleep. It disappoints me that they would not take the time, as I have always tried to take the time to listen to them, but maybe hearing real things is not quite right and you should flit into an imaginary world. It really bothers me. Here is a quote: "There is going to be a substantial increase in the operation and maintenance costs of the budget compared to any budget that we have..." - the Yukon Party - "...presented in this Legislature." It is true that overall spending on O&M is up. But, are you not comparing apples and oranges?
The increase includes new program areas that have been devolved from Ottawa - A airports and community health - and that bring their own money with them. And if people would have a look again - but I mean a credible look, not just a cursory look - a credible look. You'll see that without these responsibilities, our O&M budget and expenditures are lower than his projection from last year's main estimates. So, let's just talk real talk; let's talk real talk. Let's not sway, spin doctor. Let's do things that are real. Let's not say that taxes are going up 300 percent. It's scaremongering. Let's not do that. Let us work together to develop this Yukon - not scaremongering and fearing people. Let's figure out that if you trade your old VW in on a brand new Corvette, or such like, you're going to pay more for the gasoline taxes because your consumption's up, not because the taxes have gone up, because you're running a little higher and a little flashier.
Speaker: Order please. The member has four minutes remaining to conclude his debate.
Hon. Mr. Keenan: Well, that's certainly not enough time. But then, I do believe that for some members opposite it's more than enough time because when you don't listen, you don't hear. I certainly encourage people to hear, to listen.
So, Mr. Speaker, I say that this budget is a budget I'm very much behind, I was very much a part of putting together. I stand proudly behind this document. I stand proudly behind A Better Way. I stand proudly behind the umbrella final agreement, the Teslin Tlingit First Nation final agreement, because I do believe that those are bibles and direction that have been agreed upon by Yukoners.
And I think that if we start and move toward those ends, then maybe we will get to that world, that Yukon, that we all envision and will be able to pass on to our people. Because like others, I've been in Yukon a very long time also. I don't say I've been here before others, but I might be here after others. I'll just say that if we listen to one another and cooperate with one another, we're going to be able to move together to develop the Yukon.
So, let's not be so doggone critical about what it is. Let's not ram things down each other's throats the way the previous administration did with the CAP program, saying that, "You can have a heritage centre, but you can't because it's done over here." Let's start to look at and recognize that there are distinct people in the territory - many distinct people - people that require privacy, that require encouragement, and let's work to those ends so that we might be able to have a Yukon as it is. And again, Mr. Speaker, I suggest that this budget is the seed that is going to encourage that tree to bloom, and the umbrella protection will be there for all Yukoners. And the roots that are under the ground will be hidden, but will be the strength and give us the ability to sway through the hard times and the good times. And if we think properly, there will be more good times than hard times.
Thank you very much.
Hon. Mr. McDonald: Thank you, Mr. Speaker.
It is indeed a pleasure to speak to the budget after having heard the comments from members both on the government side of the House and the Opposition ranks. I thank them all for their comments.
It is kind of hard to inject the same kind of passion my colleague has just injected into this debate. He is a new member, and he comes to the Legislature with fresh eyes. I can say that I have only been in the territory for 22 years, but I have been in this Legislature for 15, and I've seen a lot of people come and go. I've seen a lot of arguments made. I've seen a lot of budgets presented in this Legislature.
This budget process is just the beginning. We're going to spend the next two months going through the budget estimates in detail. I'm going to do my best for the departments for which I am responsible, answer questions that the members opposite have, and explain the budgeting process to the best of my ability, so they understand the thought process that we went through to come to the conclusions that we have. I will also ask the members who are asking the questions what they would rather do differently and ask them to be somewhat precise in their comments, because we've all agreed, Mr. Speaker, after the last election, that it is time for all to work together and that we should design a discussion in this Legislature which not only has one side answering questions and the other side asking them, but also includes an exchange of opinion. The Member for Klondike has already offered to make amendments to the budget. I am looking forward to those amendments and see where he thinks things could have been done differently. Members have also made suggestions for how they would do the public accounting of government, because they say they know. Well, I'm open to those suggestions, too. I will not close my mind to anything that they have to say. They were elected as I am elected, and we should all exchange information freely.
Any budget development is, of course, never an easy balancing act. This particular budget has been characterized by some editorial writers as boring. It doesn't get the juices flowing. We haven't caused anybody to run on the Legislature and bang down the doors and complain about higher taxes or complain about being cut. This is a budget that does not sell newspapers, and for that, I apologize to the owners and editorial writers in this territory.
However, with all the greatest respect, I did not help design a budget that would help sell newspapers. I did not design a budget to pick fights with people so that it would make good copy for the reporters. We designed a budget, my Caucus colleagues designed a budget, that very conscientiously did not want to cut services to Yukoners, that very conscientiously wanted to be fiscally responsible, that very conscientiously wanted to honour commitments that our predecessors made because we knew that they had raised the commitment from public government and that should be honoured.
We knew that we were going into this process with less money. We knew we could not sustain the deficit level of spending from last year. We also knew that we were entering the budget process itself coming out of an election campaign that had raised expectations dramatically. Now, we offered to the other parties in the campaign not to get into the bidding wars on bridges, schools and facilities around the territory. We offered that early in the campaign and they should check the record. They had every opportunity to say, "Yes, we don't trade in false expectations and false hopes. We understand that there are limitations and know there are other imperatives at play."
The government wanted to be re-elected. The third party needed to show some standing; it was prepared to do almost anything, and so we did not get what I expected from my conservative colleagues in both the Liberal and the Yukon Party. We did not get what I thought would be a more responsible approach to election campaigning.
Now, when we put this budget together, we did not conduct any mean attacks on anyone. We did not come out of the process saying that we have enemies and we're going to slash certain NGOs, as our predecessors did to certain NGOs, that don't necessarily agree with us. We did not hand off responsibilities to anybody else. We did not lay off public servants.
The Leader of the Official Opposition has already suggested that the NDP came into government with a confrontational approach. All we merely said was we cannot spend at the same level as last year. What a truism. This budget reflects that. We did not say we were broke. We did not say that the world was coming crashing down, as our predecessors did. We said that we could, with wise, considerate decision making, meet many objectives, and we're prepared to stand by the choices we have made here in this budget.
We said that we were going to respect past government commitments. I knew what that meant when I said it, and that counts for a very large portion of this budget. Does that mean that the NDP has suddenly embraced the industrial support policy, that shallow piece of work that means virtually nothing? No. Does that mean that we've embraced the venture capital program, which is not a useful lending vehicle? No. But, we know that certain commitments have been made. We know that there are citizens of this territory who have come to depend on some feature of something that our predecessors have done and we do not feel it is right for us, for crass political purposes, to simply dash expectations instantly.
So we consciously made an effort throughout this process to try to identify where those commitments had been clearly made, and not only people's expectations have risen as a result, but some sort of clear obligation had been set.
We said that we were going to return to collective bargaining and we did. We did not say to public servants - teachers - that whatever they want at the bargaining table they should get. We said we were returning to free collective bargaining.
Now, for the Leader of the Liberal Party in the House, that suggests that we have set an expectation that public servants are going to get lots more money. Wrong. Incorrect. I expected more from the member than that kind of criticism.
This budget contains no bail-outs. This budget does respond to communities in trouble. We've only been in government for five months and already we've faced two crises in two communities.
The first crisis came when the Anvil Range mine shut down, or promised to shut down, at the end of last year. We responded aggressively, quickly, thoughtfully and sensitively to the people in need.
As a result, we did not have people rushing into the Legislature and pounding on the doors. We had people in Faro saying we've done well with what resources we had.
People came to us and said they needed some support; we provided it. We did not offer bail-outs this year, because of circumstances between the Curragh shutdown in 1993 and the Anvil Range in 1996 are vastly different.
And, when we get to general debate, Mr. Speaker, I'm going to challenge the Leader of the Official Opposition to put forward his theories cogently, coherently - starting tonight.
When the Old Crow School burned down we were in Old Crow the next day.
We're responding to the people's needs there immediately. We set up a planning process with the people of Old Crow for replacement of one of the most important pieces of infrastructure in their community. We did not do what some would have us do: build a school immediately. Why? Because they did not want to build the school immediately. They said so, responding to their needs, and we got a vote of confidence from them last night based on our actions.
Mr. Speaker, we said that we were going to develop new relations with governments. We have put land claims and self-government agreements at the top of our priority list. We said that we were going to pursue devolution, and already we have progress on that front, in five months. We said we were going to provide some respect for NGOs - long-term funding commitments to NGOs. We are already working on that now, in only five months. We said that we were going to respond to the needs of the homeless people in Whitehorse and we are responding in this budget, not only with them but also with the Victoria Faulkner Women's Centre.
Now, the Leader of the Official Opposition says, this afternoon, "We have 60 percent of our budget spending on social spending." Then he makes a very telling comment. He says, "That's a tough nut to crack." What he is saying is that somehow that level of spending is way too high and somehow we're going to have to cut back seriously in those areas. It's a tough nut to crack.
Some Hon. Member: (Inaudible)
Hon. Mr. McDonald: I'll get to that. Now, Mr. Speaker, what is in this budget...
Some Hon. Member: (Inaudible)
Speaker: Order please. Order please. Order please.
Hon. Mr. McDonald: ...are a number of things which are new, are fresh ideas, are things that we should be proud of in this Legislature, things that will help diversify the economy, and clearly it's a tough road ahead. But so often the members opposite say, "What are you doing to create jobs in this budget?" The Yukon Party government spent $2 billion in the last four years. Anvil Range shuts down and the unemployment rate skyrockets. What did they do to diversify the economy?
They created lots of jobs, did they? They created lots of jobs through raw government spending power. And I'll ask you something, Mr. Speaker, one thing we don't have this time that the previous government was bequeathed are spending projects like the Shakwak program, like the hospital construction, that could make up some difference when the Curragh mine went down before and the Anvil Range mine is going down now. We don't have raw spending power. We have to spend smarter.
Some Hon. Member: (Inaudible)
Hon. Mr. McDonald: Now the members opposite are heckling me about the debt, because they are obviously embarrassed about the $35 million debt from last year. Now, they ran an annual deficit last year of $35 million. I would argue that's not sustainable. I would argue that a $10 million debt is, because of lapsed funding. Now, the members opposite are always preaching that government spending creates a false economy, often contradicted by the Member for Klondike who wants us to spend more for capital works in rural communities, and who asked for $70 million in just one week in September. These members opposite are going to have to wrap their minds around the whole notion of inconsistency before they present their program to this Legislature. Otherwise, we're all going to be in a situation where the Member for Klondike is going to be saying, "Spend, spend, spend", and the Member for Porter Creek North is going to be saying, "If you spend, you create false economies, and you leave the rural communities with the impression that there is something to stick around for."
Some Hon. Member: (Inaudible)
Hon. Mr. McDonald: Now, the member says "Shame", and he is absolutely right. Sending inconsistent messages like that into this Legislature is shameful. He should not do that. He should work them out and then come into the Legislature, so we understand what they are talking about.
Mr. Speaker, the members opposite have said that there is nothing in this budget for Yukoners but there is lots for government bureaucracy. Now, first of all, on the question of the operation and maintenance spending, they are probably equating operation and maintenance spending alone to bureaucracy, and obviously the Leader of the Official Opposition is of the view that social spending is wrong, it's a tough nut to crack, you've got to cut it back. The operation and maintenance budget itself, this year, factoring out devolution, is less than the operation and maintenance budget that the Yukon Party left us with. It is less. Now, let me get this straight. If the operation and maintenance budget is less - and it is, of course, and the budget documents say that - then what is the Yukon Party leader telling us? Is he telling us that his level of spending in operation and maintenance was wrong, illegitimate, should have been changed, and how did they let themselves get out of control?
Is that what he is saying? I am not quite sure. When he says that we are spending lots on government bureaucracy and he knows that we have cut back on things like office space, cars, computers, et cetera, by 25 percent, what is he saying? The Member for Klondike is talking about the Taj Mahal downstairs.
Some Hon. Member: (Inaudible)
Hon. Mr. McDonald: The Member for Klondike, for the record, Mr. Speaker, is saying ...
Speaker: Order please.
Hon. Mr. McDonald: ...that the office renovations for the Opposition offices, which they requested, are way out of line, and I would agree with him. We tried to be accommodating, but we were criticized for it. Lesson learned.
This government very consciously reduced its spending on internal government operations, very consciously, by 25 percent in the area of computers, cars, et cetera, even though we were still faced with having to carry out long-term projects, systems projects, fancy computing projects, et cetera, that were bequeathed to us by our predecessors and that we were still carrying out in this budget year. We did that with some resistance from our own public service, but we felt that it was important in order to direct more funding into the community.
The Opposition Leader talks about us plagiarizing Yukon Party ideas - we don't have any ideas of our own- ideas like exploring trade and investment strategy, regulatory code of conduct, reading recovery, training trust funds, the youth works program, the child poverty initiatives and the training strategy. All these things are not new. He didn't mention those in his speech, but it does suggest that there are so many things that the NDP is doing now that were really Yukon Party commitments or that they were really Yukon Party ideas.
I have already indicated to the members opposite that we were prepared and we consciously made a decision that we were going to honour past commitments. It wasn't always a feature of our predecessors and I had some discussion with my colleagues, who did not always agree, because they said, "Well, wait a minute. Why should we be honouring their commitments when they did not honour our commitments before? They left people in the lurch. There is a whole empty lot down there that cost us millions as a result. Why should we do that?" I said, "I don't care how unethical the Yukon Party was. I care about what our government does and how our government positions itself with the citizenry." Mr. Speaker, when it came time to meet those commitments, we did meet those commitments. They rank in the neighbourhood of $20 million.
The Leader of the Official Opposition goes on to say, "Mine training trust funds - that was our idea. They stole our idea. There's nothing new there." Does the member opposite actually think that they pioneered the concept of training trust funds or even mine training trust funds?
Mr. Speaker, Watson Lake had a training trust fund for Sa Dena Hes that was focused on mining. That was not a Yukon Party creature. We had a training trust fund for Curragh Resources. That was not a Yukon Party invention. There was a training trust fund for the building trades. There was a training trust fund for the Tourism Industry Association. Those are not creatures of the Yukon Party. They did not pioneer the concept of training trusts at all.
The member takes offence at the fact that we went to speak to the Town of Skagway and the Alaskan state government about the future of the port as if somehow he pioneered - the Yukon Party pioneered - the concept that there should be a public port facility in Skagway. I was in Skagway in 1986 promoting public port facilities, long before the Leader of the Official Opposition even knew of the Yukon Legislature or its workings.
Mr. Speaker, the Yukon Party, which took such great offence at us for continuing with their commitments because we felt it was the honourable thing to do, has made much of the fact that we are carrying on with a couple of things that I think are good things that this government didn't have anything to do with really. One is the arts policy. I think that the consultation took place during the Yukon Party era and I think that most of the drafting of the Yukon arts policy was done while the Yukon Party was in power. Now what should we do? Should we not pass an arts policy? Should we not make mention of an arts policy simply because most of it was done during the Yukon Party era? No. Did I say during the budget speech that we designed the Yukon arts policy? No.
Mr. Speaker, there are some things that the previous government did in terms of tourism marketing, and even though we are going to be doing something with slight variations on that, we've acknowledged that and we'll continue along with many of those things.
The Member for Riverdale North says we argued against tourism marketing. He is wrong. He is wrong this time and he has been wrong before and he is wrong again. And Mr. Speaker, the Member for Riverdale North did talk about the Beringia Centre and said he wonders what I will say when I go to the opening of the Beringia Centre.
Mr. Speaker, this, for the members' information, is one of the biggest flip-flops in Yukon legislative history. I remember sitting on the government side of the House, receiving a petition in the late '80s, from the Member for Riverdale North, asking of us - demanding of us - that we put the visitor reception centre on the Alaska Highway. I was here. I have a memory. We put the visitor reception centre on the highway. After the election, before - well, you didn't even give the grass a chance to grow - he'd already made an announcement that it was going to be coming downtown. Now, what does he do? He brings, at great expense, the visitor reception downtown. And, of course, now we've got major new O&M costs associated with it and the building that he, quite openly, says he finds disgusting in terms of its design, he's made into his feature facility to promote tourism in the territory - the Beringia Centre.
Now, what I could do, of course, if I was to mimic his actions, I could be promoting in our government that perhaps we should not promote this centre. We should do something else with it - make it into a warehouse, maybe move the people from downtown up the hill, maybe do something - act irrationally. But what we have to do, because we believe in responsible public government, is we have to make this Beringia Centre concoction work.
Now, the members opposite - the Member for Riverdale North says that I know that it's a good thing. Ha! Good grief. Mr. Speaker, this was one of the poorest conceived projects on the government's books. The member himself admitted that he writhed on the government side trying to explain the finances of this particular project - how it was going to pay for itself in terms of operations and maintenance and capital in the first three years, all of which are patently false. But you know what I have to do now, Mr. Speaker, because I am a responsible public leader? I have to, along with my colleagues, try my best to make that project work because that is the responsible thing to do.
Mr. Speaker, the Leader of the Yukon Party has suggested we've now decided the industrial support policy is a useful program because we're meeting our commitments to a couple of mining companies under that particular program. The industrial support policy is not a useful vehicle, any more than the venture loan capital program is. But it is what we have on the books. We haven't changed anything. We haven't had time to change everything, but we must fulfill our obligations. We could not do, as the Yukon Party did, simply ignore the law and ignore YCEE, for example, and their responsibility to review the economic strategy. We're not going to ignore our commitments.
We are going to behave differently; we're going to behave in a mature fashion as a government, and a professional fashion and not in a mean-spirited way that was paved for us by our predecessors.
Mr. Speaker, this budget is a budget that meets a lot of commitments. This budget has us pursuing new issues, new avenues to respond to new problems and old problems.
This budget fulfills many commitments that we made during the campaign and openly stated that we were going to pursue during the campaign.
I know the community development fund, for example, is not particularly appreciated by some members opposite - I haven't heard it from everybody. We said we were going to pursue this in the campaign. The communities responded by filling the government benches with New Democrats. We will fulfil our commitments to this particular program and the other commitments we made to rural Yukon.
Now, I'm still trying to wrestle with the whole notion that the program itself is morally wrong, because I don't believe it is morally wrong. The Member for Porter Creek North says yes, indeed it is. He said the other day that if government is going to invest some money in those communities, they are showing the communities that there is reason to stay. What a comment to make about the rural communities.
If we invest in highway capital funding up the North Alaska Highway and people work on those projects, are we creating false expectations?
The member opposite says, "Create some jobs." What is capital spending in this budget? Is capital spending creating jobs or is it creating a false economy? They should make up their minds.
If the Shakwak project ended and we don't have money to replace the Shakwak project, what have we done? Have we created false expectations? I've got to ask the members opposite that.
They keep saying, "How many jobs can be created out of this budget when you're spending so much less than we did?"
The point is that the members opposite are being completely inconsistent, aren't they? Aren't they? They're saying that we should spend more money that we don't have, or they're saying the we should cut back the operations budget they had established themselves.
So, obviously they either want us to cut back on education, social spending, health care, or they want us to go into debt. Now, they may well want us to go into debt, and I'm starting to believe that they in fact do want us to go into debt. I think we've got some major accounting to do, and it's not on the government's side of the House at all; it's on the Opposition side.
The Member for Porter Creek North said, "This Destruction Bay curling rink that was paid for by the CDF - how could the government conceivably have done that when they knew they were going to shut down the Destruction Bay highway camp?" Well, Mr. Speaker, we had no intention of shutting down the Destruction Bay highway camp. We had no intention. We have every intention that the communities of Ross River and Teslin will be around for centuries. We have every intention that Beaver Creek will be around. We have every intention that Pelly Crossing will be there.
And do you know what I find most objectionable about this whole theory about creating false expectations in communities and why should they even be there at all? I find it offensive for two reasons. First of all, it's a very Whitehorse-centric view of the world. Whitehorse itself has probably 2,500 full-time public servants working here. Presumably, if they weren't working here, where would Whitehorse be? So there's an automatic suggestion that Whitehorse is entitled to government services and to government employees but the rural communities are not. Now, we know what the members opposite think of rural communities when it comes to decentralization, because they consciously recentralized government employees - over 20. But the other reason I find that offensive is because there are people living in those communities who've lived in those areas for centuries.
Some Hon. Member: (Inaudible)
Hon. Mr. McDonald: The member says, "Come on." The member says people haven't been living in these areas for centuries. There is very good reason, Mr. Speaker, why the Yukon Party has had a hard time attracting First Nations people's votes because they don't acknowledge the legitimacy of their own communities, and that is a fundamental problem that they are going to have to come to terms with.
Some Hon. Member: (Inaudible)
Hon. Mr. McDonald: Mr. Speaker, the member said that if we really cared about rural communities, we would be putting an office building in Watson Lake. Well, that makes about as much sense as building a liquor store in Watson Lake did. There are all kinds of alternatives for government to show good intentions to Watson Lake. Perhaps a good forestry policy counts, plus we are encouraging better relations between First Nations government, municipal government and the Yukon government. Perhaps other options exist for even housing government workers, if that is the prime concern of the Yukon Party. There are many ways of showing attention to Watson Lake. When the NDP was in government, it built a high school there. That was one way, in financial terms.
Mr. Speaker, the Yukon Party says that there is - I guess it boils down to - too much consultation in this budget. We keep talking about consultation and working with people. There is a call for action - get down, get things moving. They want us to be doing lots and lots of different things here.
Well, we've been in government for five months, repaired relations with the First Nations, started collective bargaining, work has been done to repair relations with the partners in education - relationships that took years to build and, obviously, based on experience in the last four years, took a matter of just a few months to destroy - and we've been working hard to rebuild those relationships.
But, let me explain at this point about consultation. Consultation means that we want to work with the citizenry of this territory to build policy and to make fundamental decisions. Now, in one sentence the member wants us to get down to action and to stop messing around with all this consultation nonsense, and in the next sentence the minister wants Tombstone Park to go through public process. He doesn't want us to make the decisions unilaterally through the land claims process.
Some Hon. Member: (Inaudible)
Hon. Mr. McDonald: Exactly. He was agreeing with us. I say it is going through a process. He says it's going through a process. I just try to figure out where they stand on consultation. That's all.
Mr. Speaker, the old refrain over the last few months has been that the commissions are in and of themselves a waste of money. They've already spent the commission funding; between the Yukon Party and the Liberal Party, they've spent the commission funding at least a dozen times already, in terms of their proposals for reallocation of the budget, but they don't remember that government has always been doing work in at least three of these areas, admittedly not local hire. They've made it very clear that they have serious reservations about the whole notion. But t
he government has been doing work in these areas for years. The difference between what we're doing now and what was being done before is that we have a member of this Legislature providing some direction and support to each of these policy areas. That's the fundamental difference.
Mr. Speaker, the member opposite says, "Four more deputy ministers." He had three deputy ministers in the Department of the Executive Council Office alone.
Mr. Speaker, we want the government to focus on energy policy. We want the government to focus on forestry policy. We want results in these areas. We want the government to focus and complete the development assessment process in a way that meets public expectations.
The members opposite say that the DAP legislation was already completed. Well, the refrain from the conservation community and the development community was, "Horrors, whatever they've done, stop it. We think that there ought to be some public discussion about this. We think that the people who are going to be affected by decisions should be involved in the decision making. So, for goodness sake, don't listen to the Yukon Party." And I can tell you, Mr. Speaker, the people of this territory agree with us.
Mr. Speaker, I'll say a few words about the comments from the third party, but I will because I vented so much this afternoon I feel it only appropriate to keep them to a minimum. I will explain to members about the $5 million contingency fund later on in Committee. It's not a voted fund. It's not dedicated to anything in particular. It's a projection of what we think we might spend on certain items over the course of this year. It's not a voted fund.
Speaker: Order. The member has four minutes remaining in his time of debate.
Hon. Mr. McDonald: Thank you, Mr. Speaker.
I will talk about and we will explore the notion of capitalizing of assets and that means I'll talk about even some of the raw facts that the Liberals have made on us about presumably increasing taxes by 300 percent. It's nonsense, of course, but I'll explain that when we get into Committee in a nice, non-confrontational way. I don't want to provoke all this negative energy from them. They've promised not to give us that kind of response.
The Liberals have said that they don't believe there's a long-term vision for education, because they don't see any long-term school plans.
I would argue that a vision for education has nothing to do with a capital program at all. I would say that capital for schools and construction of facilities and that sort of thing is a part of what education is all about, and when it's worked out with the parents, then presumably we can come to some consensus and people won't feel hurt. But, a vision for education and what goes on in the classroom and what happens with children is something that we do in the classroom, and through the learning process through the pedagogy. And, it's reflected in the Education Act. It is through the vision statement in the Education Act, and I think it's a very fine vision statement if I do say so myself. It has lots of support from this territory and it was the creature of the NDP government.
I won't go into great detail about the Liberals' comments, but I will reassure them that I have not ignored them and I will do everything I can to explain ourselves to them.
Mr. Speaker, this budget is, I think, obviously a good budget. I think the budget is well-balanced. I think the budget is fiscally responsible. I think the budget meets the majority needs of the people of this territory. It focuses as much money as we can on job creation. It focuses money into rural communities. It ensures that our basic infrastructure needs are met, and it respects past obligations. And, I would hope, that all members of this Legislature would find it in their hearts to vote for this well-crafted budget, because it was well-designed, and I would argue the fact that people are not beating down our doors. The fact is that people have thought it was well-crafted. We've heard all kinds of comments from people on the street that the budget was well-crafted; t
hat, if there was ever a time for the Liberals to vote with the budget, the time is now. No tax increases, no cuts in wages, balanced, no mean-spirited attacks on NGOs. If they don't vote for the budget now...
Hon. Mr. McDonald: ...then they will be forever paired with the Yukon Party in thought and deed, and that would be truly shameful.
This is a good budget. I'm proud of it, Mr. Speaker. It meets many needs and we'll be more than happy to share with the Opposition our thoughts of why we've chosen these priorities over others.
Speaker: Are you prepared for the question? Are you agreed?
Speaker: Division has been called. Mr. Clerk, would you poll the House.
Hon. Mr. McDonald: Agreed.
Hon. Mr. Harding: Agreed.
Hon. Ms. Moorcroft: Agreed.
Hon. Mr. Keenan: Agreed.
Hon. Mr. Sloan: Agreed.
Hon. Mr. Fairclough: Agreed.
Mr. McRobb: Agreed.
Mr. Fentie: Agreed.
Mr. Hardy: Agreed.
Mr. Ostashek: Disagreed.
Mr. Phillips: Disagreed.
Mr. Jenkins: Disagreed.
Mr. Cable: Disagreed.
Ms. Duncan: Disagreed.
Mrs. Edelman: Disagreed.
Clerk: The results are nine yea, six nay.
Speaker: The yeas have it. I declare the motion carried.
Motion for the second reading of Bill No. 4 agreed to
Hon. Mr. Harding: I move that the Speaker do now leave the Chair and that the House resolve into Committee of the Whole.
Speaker: It has been moved by the Government House Leader that the Speaker do now leave the Chair and that the House resolve into Committee of the Whole.
Motion agreed to
Speaker leaves the Chair
COMMITTEE OF THE WHOLE
Chair: I will now call Committee of the Whole to order. Is it the members' wish to have a short recess?
Some Hon. Members: Agreed.
Chair: We will take a short break.
Chair: I will now call Committee of the Whole to order.
Bill No. 4 - First Appropriation Act, 1997-98
Chair: Committee will be dealing with Bill No. 4, First Appropriation Act, 1997-98. Is there any general debate?
Hon. Mr. McDonald: Thank you, Mr. Chair. I have a few opening comments, and then we can have a free-flowing discussion about what's in the estimates, in general terms.
The total appropriation being requested here is a charge against the surplus shown on page 5-2 of the estimates, that is $452,385,000. Members will note that this is considerably lower than the forecast expenditures for the 1996-97 fiscal year of over $501 million.
Since the current year's forecast includes revotes, a fairer comparison may be to the 1996-97 main estimates. Such a mains-to-mains comparison will show that the $452 million in 1997-98 is some $20 million lower than the $472 million voted for in 1996-97. A mains-to-mains comparison, however, is not entirely valid because the budget before us today contains two devolved programs that were not in the main estimates for 1996-97. These two programs are, of course, the A airports and phase 2 of the health transfer. If these program costs were to be deducted from the main estimates we are about to debate, the budget for 1997-98 would be some $10.3 million lower.
Also, on a comparable basis, the budget for the coming year is really $30 million less than was the original budget for 1996-97.
In very general terms, this decrease can be explained by reductions in spending on the hospital and Shakwak projects. It is apparent that a decline in planned spending of this magnitude can't help but drag on our economy, especially at a time when we are facing other major challenges flowing from the Faro mine closure. To help the territory at this very critical period in its economic life, we've taken several actions aimed specifically at creating employment and maximizing the value received by the Yukon for each budget dollar being spent.
Firstly, we have decided to incur an annual deficit of just under $10 million. We would naturally rather have not had to do this. In so doing, we are drawing down our accumulated surplus - our savings account - to a little over $15 million, rather than the $25 million it would be without the deficit. However, on reflection, I believe all members would agree that there is not much point in having an accumulated surplus if it can't be used when needed to cope with the very real problems that may face the territory's citizens from time to time. This extra $10 million in spending will provide work for many Yukoners, while at the same time making available important programs and services to all our citizens.
The remaining accumulated surplus of $15 million, while lower than we would like to see it, is still, we believe, an adequate cushion for future emergencies. I say it with some confidence, because I believe we all know that there will be some lapses in spending in the year just ended, which will inevitably increase this accumulated surplus that enhances the notion of sustainable expenditures.
I know the Leader of the Official Opposition has suggested that we anticipate these lapses and incur perhaps a larger annual deficit, but I think this is a course of action that could prove dangerous and I would not contemplate it, naturally.
If it turns out that there are some extra monies to spend during the year, we can do so by supplementary when we know their magnitude. This, I believe, is a safe course of action, and it's certainly safer than spending monies we are not certain of at present.
The annual deficit of less than $10 million does bring our spending down to a much more sustainable level than was the situation in 1996-97, where a $35 million deficit is currently forecast for the year.
It is unfortunate that this reduction in deficit is taking place during a period when additional government spending would certainly be most welcome to boost our economy. However, we cannot change the fiscal situation we are facing in the short term. We must, so to speak, play the hand that we have been dealt.
The second action that we have taken to stimulate employment and keep budget money in the Yukon is to reduce expenditures on internal government operations, insofar as office furniture and equipment, data processing systems, computer equipment and office space, et cetera, are concerned.
It is apparent that purchases of most of these items does not create much employment in the Yukon. In other words, they are major sources of leakage from our economy.
Being a source of leakage, these expenditures often have no immediate nor direct impact upon citizens in general nor the services they receive. Having said this, I don't want to leave the impression that we believe all such expenditures are unnecessary. We believe we've made some wise choices in the expenditures we are proposing in certain areas. As a consequence, the capital main estimates for 1997-98 contain some $2 million less for these items than did the mains for the 1996-97 fiscal year. This has permitted these several million dollars to be diverted to projects which will employ many Yukoners in the months to come.
In terms of the nature of the expenditure items contained in the estimates, I think we've struck an appropriate balance between operation and maintenance and capital, given the constraints under which we're working.
As for individual initiatives and projects contained herein, I believe the budget comments I have already made, and have been made by my colleagues, highlighted many of the more significant areas.
When we get into line-by-line debate, we will, of course, cover these initiatives and many others in great detail so there is probably no particular point to speaking to them now. So, I will focus my remaining comments on the revenue side of the ledger, which members will note shows a significant decline from the forecasts from 1996-97. This reflects, amongst other things, the lack of the two large recoverable projects I spoke of earlier. It is a particularly significant decline of almost $20 million when one considers that the 1997-98 estimates includes $13.5 million more in federal transfers for the devolved programs: the airports and the phase 2 health transfer, which we recently assumed from the federal government.
The territorial revenue is declining several percentage points. This is a result of a number of factors, most especially the Faro shutdown and a predicted decline in investment income as our accumulated surplus declines. It is important to note that this decline in own-source revenue occurs despite an increase in miscellaneous fee revenues as a result of us now having responsibility for the Whitehorse and Watson Lake airports, where a number of fees are charged to users of those facilities. Many of these revenue changes work their way through the formula's failsafe clauses and do not have as much net impact on our total income picture as a simple revenue decline might indicate. In other words, the formula makes up some or all of the loss and, in some cases, there is a small gain due to perversity in the formula.
The Canada health and social transfer - CHST - is declining as a result of the federal cutbacks of the cash transfer portion of this program. This decrease is made up for us through the failsafe clauses of the formula financing agreement. Established program financing no longer exists, having been subsumed in the Canada health and social services transfer. The only reason it is a line here is to show the actual 1995-96 transfer; 1995-96 being the last year of the program.
The formula grant has increased largely because of the airports and health program devolutions and as a result of a decline in some revenues: the CHST program and some O&M recoveries. As mentioned previously, these declines are often made up for us through the grant calculations.
Recoveries are down 35 percent, principally due to the reduction in recoverable spending on the hospital and Shakwak projects.
Against expenditures, these income items result in a deficit of almost $5 million. However, in addition to the expenditures we are voting in this bill, we are predicting that, at some point during the year, we will require an additional $5 million in supplementary funding. Therefore, we are projecting a deficit for the year of just under $10 million, as I've already mentioned.
I do want to make it clear that the $5 million reserve, or contingency, for future supplements are not being voted at this time. It is merely a notational item for the information of members and the public. At this point, Mr. Chairman, I think there is little more that I can say about the estimates. I'm sure we'll get into greater details as we proceed through line by line. I would like, however, to respond to some queries made by some members in the Opposition respecting some concerns about the budget itself and the spending patterns.
Some members of the Opposition have suggested that the property tax revenues are significantly increasing in this budget and that, in fact, the property taxes in one area of the Whitehorse peripheral area is increasing 300 percent. Of course, that's not the case and never has been the case. In the situation at hand, the property assessments went up as a result of an assessment done last year. And, as the Minister of Community and Transportation noted in his remarks this afternoon in response to the petition, the government has opted for a revenue-neutral approach to respond to that situation and has correspondingly agreed to reduce the tax rate and consequently ensure that the government takes in no net increase revenue as a result of the assessment increase. And that is reflected in the revenue side of the budget, so one will note that not only was there not a tax increase, there was a tax decrease, and that is reflected in our budget.
As I've mentioned, the members have referred to the $5 million contingency as a slush fund. This is not the case and was not the case last year, nor the year before that, nor the year before that.
The contingency is the government's own projections of what it might need for supplementaries. The supplementaries in this case could be anything from capital works, it could be for any number of things; it could be for a portion of any settlement we might achieve with our employees; it could be all for capital or it could be for some O&M. That has yet to be decided, but we are projecting that it may be required and, if we do require it, we have to come to the Legislature and vote it. It is simply a projection to let people know what we think the annual deficit might be.
Now, I've explained to members that I believe that this annual deficit is, in fact, a sustainable deficit, so to speak. I say that because we expect it to be lapsed funding from the current year which will be applied to next year, so that by the time the lapses from this current year take place - actually, from the last fiscal year; we are already into the new fiscal year by two days - and once those lapses are logged, they will be applied to what we know to be the accumulated surplus. So that when we enter into the budget round for next year, I am hoping that we will have recouped the $10 million, if experience is any judge, and we will start once again with a $25 million surplus, which we can then draw down again by $10 million with lapsed funding from next year to restore it. Hence, the notion of sustainability.
If we must first spend more or project a deficit than is greater than the last funding, then that is not sustainable over the long haul. So, that's why we have to strike this balance. But, to simply disallow any expenditures from using the surplus funds, would simply allow the accumulated surplus to grow and grow, and grow and grow and grow and grow. Hence, the citizenry and the federal government would be asking us why we need the spending, if we don't have projects, or infrastructure, or investments we can make in the Yukon.
Clearly, there are reasonable expenditure proposals that we can make, and so we want to be able to make those as we go. Hence, last year, when the government tabled a deficit budget, I did not object to the fact that it was a deficit budget. I said that it is reasonable to consider drawing down some of the surplus, if the level of expenditure is sustainable.
So, I make that point; I think it's an important point to make and, admittedly, it's a balancing act; we'll have to try and maintain it as carefully as we can.
The Member for Porter Creek South wanted the government to consider the notion of the capitalization of assets. I am not certain precisely why that proposal was being made, but I'd be interested in hearing the member's comments. I would point out that if we do capitalize our assets, then we will be showing just an enormous surplus, because, presumably, I think we probably would have hundreds and hundreds of millions of dollars worth of assets. It wouldn't help us at all to show them as a surplus, because we would still have to borrow money if we were going to spend more than we took in. So, I'm not certain as to the intent of that particular proposal, but I'm not going to... I just want to hear more, and if the member can explain why we should move from that model to the current expense model that we've adopted over the years, maybe she can tell me why she believes that we should be thinking of new ways of doing things.
I want to make it clear, too, that the tradition in this Legislature is to pay for capital projects as you go, and hence, we don't have debt on our facilities, because basically what you see is paid for. That's a tradition that wasn't begun by the NDP. It wasn't begun by the PCs. It was done long before that, but it is a tradition that I think that we can all be proud that we have retained, and if the members feel that we should be embarking on new ways of funding capital works - I know that there were some innovative proposals for funding the Dawson bridge, which I may have rejected out of hand.
We campaigned on these issues. If the members feel that there is a good justification for doing it that way, I'd be pleased to hear about it, but I must admit that my predilection is to not to get into debt financing for major capital works. I would hope that we could avoid that.
What else has been said here? I want to try to cover as many points as I can so that members will know that I am listening and trying to respond clearly.
Let's see. There was a question about the personal income tax and why that has risen nine percent. The short answer to the question, as I'm sure some members will know, is that all our forecasts are based on federal projections and all our payments are based on rolling averages.
I would suspect that the forecasts made by the federal government haven't taken into account entirely all that is happening in this territory and may not take them into account for a couple of years yet, as they catch up to our situation.
But I would make a point that, if our personal income tax receipts are down, it doesn't necessarily mean that our general revenue is down because there will be a corresponding response through the formula financing agreement. That is failsafe. But the question is legitimate as to why personal income tax would be up if unemployment's also up, or for projecting that unemployment would be up.
Members asked questions about the revenues and the fees going up approximately 100 percent. This is not because the government is contemplating any major fee increases anywhere in the government. This is exclusively because the airports transfer have with them certain fees and revenues that we did not previously collect: landing fees, the much-hated parking fees at the Whitehorse airport - all of those things now come to the Yukon government and are recorded in our estimates.
So, that was that.
Sorry, Mr. Chair, I move that you report progress on this bill.
Motion agreed to
Hon. Mr. Harding: I move that the Speaker do now resume the Chair.
Motion agreed to
Speaker resumes the Chair
Speaker: I will now call the House to order. May the House have a report from the Chair of Committee of the Whole.
Mr. McRobb: Mr. Speaker, Committee of the Whole has considered Bill No. 4, entitled First Appropriation Act, 1997-98, and directed me to report progress on it.
Speaker: You have heard the report from the Chair of the Committee of the Whole. Are you agreed?
Some Hon. Member: Agreed.
Speaker: I declare the report carried.
Hon. Mr. Harding: I move that the House do now adjourn.
Speaker: It has been moved by the Hon. Government House Leader that the House do now adjourn.
Motion agreed to
Speaker: This House now stands adjourned until 1:30 p.m. tomorrow.
The House adjourned at 9:29 p.m.
The following Document was filed April 2, 1997:
Major Federal Transfers to Provinces and Territories - 1996 to 1999 (Cable)