Whitehorse, Yukon
Wednesday, April 9, 1997 - 1:30 p.m.
Speaker: I will now call the House to order, and we will proceed at this time with prayers. I would ask members if they would take a few moments in silence.
Prayers
DAILY ROUTINE
Speaker: We will proceed with the Order Paper.
Tributes.
TRIBUTES
Tribute to Vimy Ridge
Hon. Mr. McDonald: "As far as I could see, south, north along the miles of the ridge, there were the Canadians. And I experienced my first full sense of nationhood."
Mr. Speaker, these words, written by Lieutenant Gregory Clark, Military Cross, 50 years after the Battle of Vimy Ridge, say eloquently what many historians and members of the public have long thought - that the nation of Canada was born on Vimy Ridge.
On April 9th, 1917, the Canadian Corps launched its assault on the German positions defending Vimy Ridge, a long, low ridge near Araas, France, forming a key position in the Hindenburg line. Both British and French forces had tried unsuccessfully to take the ridge and their losses had been staggering, with the French alone suffering 150,000. Both knew that the ridge simply could not be taken.
Finally, the job was given to the Canadian Corps. It would mark the first time that the corps would fight as a separate and distinct unit and its achievement would be enormous, for the enemy was swept from the ridge in approximately five days.
Supported by almost 1,000 pieces of artillery, the Canadian Corps attacked along the 6.4 km front. By the 14th of April, the Canadians had gained more ground, more guns, more prisoners than any previous British offensive. Casualties were severe, amounting to 10,602, of whom 3,598 were killed in battle. However, the sense of achievement and national pride created by this success gave the Canadians a great sense of self-confidence and distinction as an elite corp.
Mr. Speaker, even today, 80 years afterward, Vimy Ridge remains an enduring Canadian myth, marking in most minds a turning point in Canada's relations with the world and the image of Canadians and the image that Canadians had of themselves. It would become the historic milestone in our emergence from the colonial shadows as an independent nation.
I ask all of us in this House to remember the veterans of that event and to reflect, along with those who gathered this morning at the city hall, upon the thousands who stayed behind.
Thank you.
Mr. Ostashek: Mr. Speaker, we too, on this side, rise to pay tribute to those Canadians who fought and gave their lives at Vimy Ridge.
Vimy Ridge was a turning point in World War I, and it was the first time that Canadians fought together as a unit. Canadians fought and won where the French and the English had failed. It was a tremendous victory and brought international recognition to Canada as a nation.
Mr. Speaker, we must never forget those Canadians who sacrificed their lives for freedom and democracy, and who have helped to make Canada the country that it is today. On this 80th anniversary, we Yukoners will remember them. Thank you.
Speaker: Introduction of visitors.
Are there any documents or returns for tabling?
Are there any reports of committees?
Petitions.
Are there any bills to be introduced?
Are there any notices of motion?
Are there any statements by ministers?
MINISTERIAL STATEMENTS
Cabinet commission on energy workplan
Mr. McRobb: Thank you, Mr. Speaker.
I rise today to inform the House about the workplan of the Cabinet commission on energy. The Energy Commission was created in response to the wishes of Yukon men and women who informed us about specific energy-related issues of importance to the territory.
Our government recognized the need to place a high priority on resolving such issues and, on a broader level, to develop the Yukon's first comprehensive energy policy.
In keeping with our government's commitment to public participation, the commission is committed to achieving these goals through meaningful consultation with Yukon people. At the request of the Yukon Energy Corporation, the deputy commissioner provided expertise in the negotiations leading to an agreement in principle on a new operating arrangement for the management of publicly owned energy assets. When it is ratified, this new agreement will benefit Yukon women and men in many ways, including a $2 million reduction in the amount paid to Alberta Power Ltd. over the next five years.
A review of the electrical bill relief and other forms of rate subsidy is now underway. We expect to release a discussion paper on rate relief soon to provide focus to our consultations with stakeholders and the general public. Our government is committed to working toward stabilizing electricity rates and developing a need-based subsidy program that respects conservation goals.
We have also been busy meeting with a number of stakeholders to discuss general energy issues. These informal meetings also provide an opportunity for us to receive preliminary feedback from various projects that we are undertaking.
This spring, we will be surveying a broad spectrum of Yukon women and men on their basic goals for energy management. A questionnaire will allow them to identify energy issues, priorities and concerns of importance to them. It will also acquaint Yukon people with the work of the commission. The questionnaire is part of a consultation plan that combines this type of polling with focused stakeholder consultation.
During the next year, the commission will also offer recommendations to Cabinet on the governance relationship and practices between the Yukon government and the publicly owned Yukon Energy Corporation.
In conjunction with energy stakeholders and interested parties, the commission will undertake two other specific policy development projects this year: a review of the Yukon Utilities Board streamlining plan, with the goal of introducing cost-effective measures to increase interest in participation by members of all rate classes in YUB processes; and, a review of energy supply options, including microhydro, wind, waste wood, coal, gas, oil and solid waste, in order to set priorities for how the Yukon can meet its own energy needs.
The commission's work will be guided by three fundamental goals - Mr. Speaker, I notice the Leader of the Official Opposition finds this amusing. Perhaps he's embarrassed that his government failed - failed miserably to provide any long-term energy planning and policy to help resolve some of the problems of importance to Yukoners today.
The commission will be guided by three fundamental goals: energy conservation and protection of the environment; substitution of imported fossil fuels for local energy sources; and, sustainable development of Yukon's energy resources, consistent with the above principles and sound economic planning and practice.
All of the commission's efforts, Mr. Speaker, are aimed at developing the Yukon's first comprehensive energy policy that recognizes the right of Yukon people to have reliable, reasonably priced energy available for transportation, domestic heating and electricity.
We believe that Yukon men and women need such a sound energy policy to work in concert with this government's sustainable environmental and economic development initiatives.
Speaker: Are there other statements by ministers? I'm sorry - leader of the third party.
Mr. Cable: I was just holding back, waiting, Mr. Speaker.
You know, Mr. Speaker, last week we heard that the energy minister was helping the Energy Corporation set up a procedure for preparing rate applications, so I'm particularly pleased to see that the commissioner will be addressing the issue of the governance of the corporation and its relationship with the Yukon government.
I do have some questions for the commissioner. Part of the agreement in principle that was reached with Yukon Electrical sets out 20-year franchise agreements with Yukon Electrical. Now, this effectively cuts out the municipalities and First Nations from the distribution business, and anyone else, for that matter. That's a major policy issue. Perhaps the commissioner can tell us whether that major policy move was made with his approval and with his input.
It appears from the statement that the energy policy, despite the name that's attached to it, "comprehensive energy policy", is going to be developed segmentally with some vague time lines attached to the various segments.
When he replies, would he be good enough to tell us why the whole of the comprehensive energy policy is not being moved forward as a package, so that the policy can be integrated? Perhaps he could also tell us what the energy minister has just written to him by way of helpful hints?
Mr. McRobb: Thank you, Mr. Speaker. I note that the Leader of the Official Opposition would rather choose to sit in his seat and heckle than stand on his own two feet and put on record his comments, and I want to thank the leader of the third party for having the courage to do that.
In answer to the leader of the third party's questions on franchising, let's deal with that one. The new operating agreement in principle certainly does not cut out municipalities and ownership of energy transmission or distribution. This question was dealt with last week in Question Period. I refer the member to Hansard. If the member would like a more detailed explanation, I invite him to call me and, outside of Question Period, we can sit down and discuss exactly what has taking place.
As a former member of the legal profession, I imagine, Mr. Speaker, the member is also aware of the legal rights that the Yukon Electrical Company would have, being the owner of distribution facilities in many of the Yukon communities and, rather than engage in long, lengthy and expensive legal processes, that was dealt with in this new operating agreement.
Secondly, the member had questioned why the comprehensive energy plan was not submitted all at once. Quite simply, Mr. Speaker, there are a number of components we are dealing with in the first year that need addressing within the first year. We heard last week the Energy Corporation is considering approaching the Yukon Utilities Board with a general rate application this fall. For that reason, we want to review the process used by the Yukon Utilities Board to enhance participation on behalf of consumers of electricity in time for that process.
We also recognize the need for additional generation options in the territory. There's no need to further delay that by a number of years, as is suggested by the member, when we can deal with it sooner than the time the comprehensive energy policy becomes available.
Thank you.
Canada/Yukon Business Service Centre
Hon. Mr. Harding: I rise to announce that the Canada/Yukon Business Service Centre opened today to assist the small business community in the Yukon. The Canada/Yukon Business Service Centre is a joint partnership between the Yukon Chamber of Commerce, Industry Canada and the Government of Yukon and exemplifies our government's policy to assist and work effectively with the business community.
The centre will offer a one-window access to government programs and services and comprehensive electronic data bases for research and business planning. The many resources available will help businesses to expand operations by identifying new markets and products. The services are of particular importance to rural businesses which have had more difficulty in the past accessing information quickly. The Canada/Yukon Business Service Centre will allow Yukon businesses to become more involved in the business community and holds the potential for extending their customer bases around the world.
The Yukon government will provide $55,000 to the Business Service Centre: $30,000 as a direct contribution and $25,000 in support and services from the Department of Economic Development. Our government's support of the Canada/Yukon Business Service Centre is also recognition of the critical and valuable role small business has as a major employer and player in the territorial economy.
With the resources it offers and its ability to assist Yukon small businesses identify new markets and products, the Canada/Yukon Business Service Centre is one tool to assist small businesses to expand and new jobs to be created. I am proud to fund this initiative and believe it is a wise investment in the future of the Yukon's small business sector.
Mr. Ostashek: Thank you, Mr. Speaker. I thank the minister for his statement today. The Canada/Yukon Business Service Centre was born out of the federal Liberal government trying to stoke small business after killing the EDA programs that they had in the north. It was put out, hopefully, to diffuse some of the criticism.
We talked about this in general debate the other day and the problems of getting into pilot projects with the federal government and then having businesses become dependent upon them. I believe that there probably is some use for this centre and it can probably contribute to small business in the Yukon, but I have a great concern that, three years from now when this pilot project is over, the federal government is going to close the door and say, "There you are, territorial government, it's a good deal; you pay for it."
When the minister gives his summation, I would just like to ask a couple of questions. Is the contribution that is being provided by the territorial government a one-time only contribution, or is this an annual contribution for the three-year period in which the pilot project is going to take place?
Ms. Duncan: I would like to rise, and I believe it is actually in tribute to the partners in the Canada/Yukon Business Service Centre. It is an important new addition to this business community. The Whitehorse Chamber of Commerce president said it today briefly, and he said it, I believe, best: "The Canada/Yukon Business Service Centre is visionary." This visionary achievement is a credit to the people involved. I, for one - and I believe I am not alone in this House - am familiar with many of the volunteers in the business community, and the countless hours that they devote to Whitehorse and the community chambers and their projects that benefit the entire community. Behind every board, there is a great executive director, and I would like to congratulate Mary Tooley with the Yukon Chamber of Commerce. It isn't always easy meeting the dreams of the board and I congratulate her and her staff on their achievement today.
I join with all Yukoners in welcoming this addition to our community and wishing the service centre much success.
Hon. Mr. Harding: Thank you, Mr. Speaker. With regard to the Official Opposition's comments, I thank the member for them. I, too, share some of his concerns about the federal government and the rationale that led to the development of this particular project, and the potential for them funding the two years and then pulling out, leaving the territorial government on the hook. We've already seen many Yukon citizens have made a request to both his government and our government to pick up federal programs that were brought forward as pilot projects and taken as good ideas and eventually, people end up at the doors of the Yukon government to pick that up.
We would hope that the federal Liberals would not do that if they're around after the next election, that they would continue to participate to the level that they are now. Mr. Speaker, our commitment is for two years. We have indicated to the chamber that we are not going to be picking up the funding if the federal government pulls out. We cannot do that all of the time when the federal government decides that they're going to start something up, come up here as they did today and sell it to the public as a good idea and then pull away. So, I made that clear actually as I was having lunch today with the people from the federal government, that they had better be boning up on how they were going to assist the Chamber of Commerce here locally and ensuring that they could make this Yukon/Canada Business Service Centre pay more for itself and also to find other funding sources for this particular centre.
I'd like to thank our MP, Audrey McLaughlin, for her lobbying not only of our government, but also of her lobbying of the federal government and working with the Yukon Chamber of Commerce. I'd like to thank the Yukon Chamber of Commerce as well and, Mr. Speaker, I'd also like to thank the federal government. I think there is some benefit in this initiative. And I'd also like to thank my department who put quite a bit of work in this over the period of not only the Yukon Party administration, but also the New Democratic. Thank you.
Speaker: This then brings us to the Question Period.
QUESTION PERIOD
Question re: Taylor House, preservation
Mr. Phillips: My question today is for the Minister of Tourism, primarily dealing with the heritage side of tourism.
This morning the Yukon Chamber of Mines issued a press release where it has offered the Taylor House to the City of Whitehorse for $1 as it plans to move the house off the property and sell the land. I would like to ask the Minister of Tourism if he will take whatever steps are necessary to ensure the preservation of the Taylor House?
Hon. Mr. Keenan: Thank you very much, Mr. Speaker.
This is a city issue and I have talked with the mayor, as early as lunchtime. Why I cannot find my notes, I do not know, but I can certainly assure the member opposite that the city will be working with due diligence for the preservation of the Taylor House, and are going to be meeting on Thursday the 21st, I believe it is, for a decision. Thank you.
Mr. Phillips:
Well, Mr. Speaker, I'm a little surprised at the position that the Minister of Tourism has taken on this one, because on July 30th of 1996, the present Government Leader - who was the Leader of the Official Opposition at the time - said that he wants the Yukon government to intervene to make sure that Taylor House, currently the home of the Chamber of Mines, doesn't fall to the wrecking ball.
My response was the same as the Minister of Tourism's, that the city will deal with it because of the Historic Resources Act, and he asked me to intervene regardless of the position we took. Is he now saying the position of the government is - now that they're in government - that they've flip-flopped on this issue, and it's not their position to intervene or even be involved in this thing, and it really is the responsibility of the City of Whitehorse, and they're not going to do much about it?
Hon. Mr. Keenan: Flip-flop, TROY, buzz words for me certainly, but, I am a calm person.
No, Mr. Speaker, we are not flip-flopping on this. We are just using due process, and I do believe that's what any government should be doing, is following the process as they go along.
Mr. Speaker, not only by following the process do you get good decisions, but you build partnerships with other jurisdictions, something that my government is going to do and going to follow to do.
As far as flip-flopping, no, Mr. Speaker, there's no such thing as flip-flopping on this side of the House. We are here to work with the municipality and to respect their jurisdiction.
Mr. Phillips: Thank you, Mr. Speaker. Well, Mr. Speaker, the minister didn't answer the question.
The question was about the position his party took prior to the election is that the Government of the Yukon should take steps - whatever steps are necessary - and make the Taylor House a priority, and take whatever steps are necessary to ensure that the capital city does not lose a significant landmark.
What I'm asking this minister is, regardless of what the city does on this, if the Taylor House is at risk, is the position the same, that this government will step in and rescue the Taylor House, as it asked us to do back in July of 1996?
Hon. Mr. Keenan: I certainly thank the member opposite for bringing up dates, et cetera, and following the record, and what their good work is going to do. I must remind the member opposite that I do believe this piece of legislation was left inactive for four years, for whatever reason. They had the opportunity to certainly move that forward and maybe solve this problem much sooner than is arising now.
Mr. Speaker, I will stick with my answer and say that I'm working in respect of the community of Whitehorse and their decision-making authorities, and I will continue to work with them on their authorities. We shall leave it to the process and, at such time, we will make decisions based on what the process offers us.
Question re: Taylor House, preservation
Mr. Phillips: Well it's interesting, Mr. Speaker, that before the election, when they were in Opposition, regardless of what the city was going to do, the government should step in. But today, because they are government, it's in the city's hands and we're not going to make any decision on it yet.
Mr. Speaker, I'd like to table the news release and a letter sent to me by the then Opposition Leader, who states that the government should ... in fact the press release is titled, "The government should act to protect the Taylor House," and I agree with the press release that he's got there. They should at least stand behind -
Some Hon. Member: (Inaudible)
Speaker: Order. Order please.
Mr. Phillips: They are the government now. In Opposition, they said the government should intervene. I want to know if they've flip-flopped on the issue. Are they now saying the government shouldn't?
My next question to the minister of heritage: before the election, the NDP said, in relation to the Taylor House and other heritage issues, that heritage was a priority. In fact, they were the heritage party. In fact, that is not reflected in their budget. Capital expenditures are down in this budget, significantly. The historic resources centre is gone completely - not in the budget, not even given a mention in the budget speech. Museums assistance is down -
Speaker: Order please. Would you come to your question?
Mr. Phillips: Yes, I will, Mr. Speaker. Museums assistance is down 16 percent, and exhibits assistance for museums is down 25 percent.
Why did your government say heritage was a priority before the election, and then strip the funds out of the budget for heritage?
Hon. Mr. Keenan: Well, Mr. Speaker, I will certainly be able to talk about our alleged flip-flop. Let me clarify that. My government has not flip-flopped on any such thing again. We are here to work with the city, respect their jurisdiction and follow due process. As far as protecting the house, of course I want to see the heritage of the Yukon protected in any way possible. I do believe that just my initial contact with the mayor today at lunchtime proves that. I don't know what more to say.
Now to get to the real question, I guess, that was being alluded to but finally poked its way forth, this year, we will be addressing this during line by line and we'll have ample opportunity to do that when we get to Tourism, and I certainly encourage you to ask all the questions and inform yourself and the general public through these discussions. We were left with a very tough decision-making process, thanks very much to the previous administration and their default or maybe their all-consuming desire to do other things outside of helping preserve museums and helping to preserve anything to do with heritage but to build a lot of road.
This is a balanced budget and I will be more than happy to elaborate that when I get to line by line in the Tourism debate.
Mr. Phillips: Thank you, Mr. Speaker. Well, that was a nice speech but he certainly didn't answer my question. The question to the minister is: if heritage is so important and such a priority to the New Democratic heritage party over there who claim that heritage is a priority, why did they slash and burn the heritage budget on the capital side from the historic resources centre to the capital grants going to the museums? We are moving up to the anniversary years and many of the museums are preparing and planning exhibits for the anniversary years, and this government has slashed the budget significantly.
Why, Mr. Speaker, have they done that? Was this minister too weak in the arguments when they were debating the budgets within his own caucus that he couldn't get enough money for heritage?
Hon. Mr. Keenan: Well, Mr. Speaker, not only did I meet with the - or not meet, excuse me. Not only did I contact the mayor at lunchtime, but I also talked to the curator of the MacBride Museum and explained to the curator of the MacBride Museum the tough decision process that we are in this year, and I am certain that he was accepting of the explanation. The explanation was such that we were left with significant shortfalls in all areas and that our budget is working to balance that. He accepted that, and if he can accept that, then I certainly understand that maybe the member opposite could accept that and then the member opposite would - what does that mean? I guess that just means think back to their opportunity and the time they had when they were in administration to be able to work towards those ends which he is saying now.
Mr. Speaker, it's called a balanced budget and I will be happy to explain that when I get to the line-by-line item.
Mr. Phillips: Thank you, Mr. Speaker.
First of all, it's not a balanced budget. It's a deficit budget. Secondly, the Government Leader himself has risen in the House and told us that he expects lapses similar to other years, so we all know that we're going to have between a $20-million and $40-million surplus at the end of this fiscal year, and yet, in their budget they chose - after speaking out loud and clear in the general public that heritage was a priority and that if they were in government they would do something about heritage - the first thing they did is that they slashed and burned the heritage budget.
I'm asking the minister why did they do that? Heritage is important to Yukon people - the First Nations people and other people - and yet they slashed and burned the budget. Why did the minister do that, and why did the minister let it happen?
Hon. Mr. Keenan: Mr. Speaker, it's certainly good that we have passion in the House on such things as this, and I would certainly encourage that that passion be carried forth in the every day life, 365 days a year, and certainly not at this deliberation time in the budget.
But, I can certainly answer with passion also. We chose to be a responsible government, Mr. Speaker. We chose to do things in a balanced effort. Whether you call it a balanced budget or not, it is balanced in my mind, because we are working with what we were left. That was nothing. That was absolutely nothing, so the community at large is willing to take initiatives so that we might be able to come forward, we'll be able to stand on our own two feet, and to move forward into the future with what we have, and heritage will definitely be a major part of that. I do not know what more I can say to that in Question Period, other than I certainly look forward to an invigorating talk and discussion, line by line, when it comes to that time.
Question re: Business education partnership program
Ms. Duncan: Thank you, Mr. Speaker. My question is for the Minister of Education.
The business education partnership program, which began some five years ago between the Whitehorse Chamber of Commerce, the Department of Education and First Nations, has fostered a strong relationship between the business community and the Department of Education. Does the Minister of Education believe this partnership is valuable and should continue?
Hon. Ms. Moorcroft: Thank you, Mr. Speaker.
The Department of Education has ongoing work with the business community. There are a number of programs such as the cooperative education project that we do believe are important.
Ms. Duncan: Mr. Speaker, we heard today from the Minister of Economic Development that this government is interested in supporting small business. Dana Naye Ventures has secured $500,000 from the federal government to support native youth at risk and assist young First Nations entrepreneurs. Dana Naye is committed to using this funding for the business entrepreneurship program. The stumbling block is the Minister of Education. The department has been asked to come to the table with one full-time equivalent position. If the minister and this government truly support partnerships with the business community, when is the minister going to direct her department to find one staff person in support of this program?
Hon. Ms. Moorcroft: Mr. Speaker, I have had meetings with the business community, including Dana Naye Ventures and the group who are advocating for the new business entrepreneurship centre. We are working with them. We have not, at this time, approved that particular project.
Ms. Duncan: It is not a particular project; it is one full-time equivalent person. This program also has the additional support of the federal government to the tune of $100,000 in lapsed funding from the Canada/Yukon economic development agreement. It has the support of the business community who have prepared to contribute $36,000 and untold hours, and volunteer support, for this program. Would the minister state when she and her department will find one full-time equivalent, which is all this program is asking for?
Hon. Ms. Moorcroft: Mr. Speaker, we have not made the decision to support that program and are still evaluating whether it is the best use of resources. The members opposite are coming forward on a daily basis with more requests for where we should spend money, and we have a limited amount of funding. Now, the member opposite is saying it is one person. The fact is, every individual funding request has to be dealt with in looking at the overall picture of where we balance our funding.
Question re: Schools, capital planning process
Ms. Duncan: Thank you, Mr. Speaker. My question is again for the Minister of Education.
The minister has committed to consulting with school council chairs about the capital planning process for schools, and has proceeded to make it as difficult as possible for the chairs to do so. An all-day meeting for February 14 was cancelled at the request of the school council chairs because this meant that they had to take a day off - unpaid day - from their work to attend a meeting. In the case of rural school council chairs, it would have been two days.
Yesterday, she told this House that the school council chairs would be meeting May 2 - another work day - and May 3. If the minister is truly interested in hearing from school council chairs, why does she continue to schedule meetings around her convenience instead of the school council chairs', who, again, will have to take time off work to attend.
Hon. Ms. Moorcroft: Thank you, Mr. Speaker. I would dispute the member's assertion that this meeting has been arranged for the convenience of the minister and not for the convenience of the school councils. The fact is that this meeting has been arranged, working with school councils, to accommodate them as best we can. When I met with the Whitehorse school council chairs, we had a discussion about scheduling meetings for Friday or for weekends. We came up with the decision to schedule this meeting over both Friday and Saturday. One member from each school council is attending, and school councils have the ability to designate someone who is able to get away for Friday to come to the meeting.
I believe that school councils are looking forward to the opportunity to discuss agenda items that they have put forward.
Ms. Duncan: The minister believes school council chairs are happy to be respected and happy to be consulted - the minister just told us so. In fact, Mr. Speaker, they feel like targets walking into this meeting. They feel that this process will not foster cooperation among school councils. In fact, they feel quite the opposite, that it is a divisive process. They know that this meeting is going to pit one school council chair against another.
What steps has the minister taken to ensure that school councils work toward reaching consensus, instead of working against each other? For example, has she hired a trained, independent facilitator to help school council chairs reach consensus on the capital planning for education?
Hon. Ms. Moorcroft: Mr. Speaker, the member is wrong. This is absolutely not a divisive process. I would submit that it's the member opposite who trying to stir up division here with her line of questioning.
Mr. Speaker, for the member's information, the topics that are being discussed when the school council chairs come together are a number of items that the school councils themselves want to have an opportunity to talk about: the formation of a chairs group and working with the department; health-related issues in school. The capital planning process is one item on the agenda and I think the member is absolutely wrong that this would be divisive.
I have a lot more respect for the ability of school councils to act in the best interests of the school children of their communities than the member opposite.
Ms. Duncan: Mr. Speaker, I have so much respect for school council chairs - I've listened to what they had to say to me. It's their words, not mine, that I'm using.
Contrary to what the minister says, the capital planning process for education has been a political process and it will continue to be one under this government. This type of meeting will do nothing to change that. I have asked her three times in this House to table the process for reaching consensus and I'll ask her again: will you table the process by which you intend to reach consensus among school council chairs?
Hon. Ms. Moorcroft: Mr. Speaker, I'll be happy to come back for the member with an outline of the agenda items that the school council chairs will be discussing on May 2nd and 3rd, including planning for capital expenditures.
I think that the school council chairs are able to take a look at the rural and the Whitehorse school facility studies, they're able to represent not only the interests of their own school community, but the interests of the Yukon education community as a whole, and we are going to give them an opportunity to do that.
Question re: Ministerial travel
Mr. Phillips: I have a question for the Government Leader regarding ministerial travel. Yesterday in the House, the minister said he did not want his ministers travelling business class, and, he said, particularly on the Vancouver to Whitehorse run, a short two-hour flight. He went on to agree that the optics are bad and that his ministers should ride with the rest of Yukon travellers in the coach section.
I'd like to ask the minister what he plans to say, or what he'll tell his Minister of Economic Development, who travelled from Vancouver to Whitehorse on March the 13th in the business class section of the aircraft, while his own constituents were being thrown out of work and on the unemployment lines in Faro.
Hon. Mr. McDonald: Well, Mr. Speaker, the member is referring to, I presume, the private vacation of the minister, who was paying for his own flights and was in the plane at his own expense. I indicated yesterday, in response to questions by the Leader of the Official Opposition, that the policy of the government is to pursue a policy where all members should fly economy class on domestic flights. The Leader of the Official Opposition, at the time, indicated that he felt that MLAs should always fly, even if it is at their own expense, only economy, because it looks bad to the public if they're flying in business class, even if they're paying for it at their own expense. I allowed that that was probably good advice. But the policy of the government is that, for domestic flights, ministers will travel economy.
Mr. Phillips: Well, I hadn't realized the Minister of Economic Development had taken another Mexican vacation. I know he's been working pretty hard for three or four weeks now, and maybe he's due for one, in his mind.
My understanding is that this happened on March the 13th, and he was back from Mexico. I think his Mexican trip happened in January sometime. He was sitting in the business class section of the airplane, riding back from Vancouver. I know the Minister of Economic Development thinks he's a big shot, but he's got a lot of constituents that are out of work and can't even afford to fly on an airplane right now.
Speaker: Order.
Mr. Phillips: I'd like to ask the minister -
Speaker's ruling
Speaker: Order please. Aspersions shouldn't be made on the reputation of members of this House.
Mr. Phillips: Mr. Speaker, there's no aspersion on the reputation of the member of the House, but quite frankly, Mr. Speaker, his constituents are out of work.
Speaker: Order.
Mr. Phillips: The policy of the Government of the Yukon -
Speaker: Order. The reference to the member being a big shot, that's not called for. That's unparliamentary.
Mr. Phillips: Thank you, Mr. Speaker. Well, I'll change it a little. The Member for Faro obviously thinks he's a very important person by riding business class, but I don't think his constituents, and other constituents in the territory, think that's proper.
The previous government had a policy where on domestic and North American flights, we rode coach with everyone else. The Minister of Finance has been crying poverty. He said here today that that is going to be his policy as well. I wonder if he can tell us what action he's going to take against his Minister of Economic Development, who thinks he should ride in the front of the airplane, as opposed to the back, where all Yukoners who do fly back and forth from Vancouver usually ride?
Hon. Mr. McDonald: Well, Mr. Speaker, every time I get up and answer a question from this member, the member is asking me to take action against somebody, either somebody in the public or to carry on some sort of attack against some individual. He's got a single-track mind and I find it very, very unfortunate. Very seldom do we ever tackle policy issues; we're always attacking people when this member asks questions.
With respect to the policy of this government - and it was the policy of the previous NDP government, too - ministers travel economy on domestic flights. That's the policy.
I indicated to the Leader of the Official Opposition yesterday that I allowed that it was probably good advice, but I did not tell my colleagues, if they wanted to pay for it themselves, that they could not fly or they could not upgrade their tickets at their own expense. I did not say that. I said that it was probably good advice for appearances sake because the Leader of the Official Opposition was making the perception argument. He wasn't making a policy substance argument, but was making an argument about perceptions. And so, I indicated that it was probably good advice and for anybody listening, they should probably take heed; I agreed.
With respect to the commandments to tell people what to do, I indicated that I would not tell people what to do with their own money and I'm not going to attack anybody, either in the public, or my own colleagues, or even members in the Opposition benches at the insistence of that particular member.
Mr. Phillips: Thank you, Mr. Speaker. Well, the point is that it is about optics. It is about a minister travelling on government business. It is about a policy this government has and I don't care whether the minister pays for it himself or not. The minister should not be riding business class. The other people that are riding in the aircraft do not know that and the minister should ride with everyone else in the aircraft to set an example. We have 15-percent unemployment in the territory. Every one of the minister's constituents are laid off in his own riding and this minister is riding in the front enjoying the luxury of business class and I think that's a very, very poor example for him to be setting for this government that's crying poverty.
In fact the Minister of Tourism cried poverty here today for the huge burden we left him, but his ministers are travelling around like they're the most important people in the world. I think they should...
Speaker: Is there a final point?
Mr. Phillips: ...fly the way everyone else does.
Speaker: Is there a final supplementary?
Hon. Mr. McDonald: Mr. Speaker, I would remind the member that the expenditures made here are not from the public purse but from people's own pockets. So, the member is making an argument that the optics are important and the substance is not necessarily critical. I'd say substance is important. I allowed, as a matter of personal advice, that the optics are a consideration, but substance is important to this government. As far as all the cheap shots that the member has made both before and now regarding the work of the Minister of Economic Development - this minister has worked very hard indeed to not only provide for good leadership on the economic development front, but also to deal with the mine closure in Faro, which the member has raised, and done it so sensitively that the people of Faro have not come stomping into this Legislature to complain as they did when the mine shut down previously under the Yukon Party government.
Question re: Animal protection legislation
Mr. Cable: I have some more riveting questions here. I have some questions for the Minister of Justice on animal protection legislation.
In December, my colleague, the Member for Porter Creek South, asked the minister whether she anticipates bringing animal protection legislation to this House, and the minister at the time indicated that animal protection legislation may be part of the fall legislative session but she wasn't sure. Now, this issue has been a sore point with the animal protection community around the Yukon for quite a while.
Has the minister decided whether to bring this legislation forward and, if not, would she now tell the animal protection community, through this House, when she intends to bring that legislation forward?
Hon. Ms. Moorcroft: Thank you, Mr. Speaker. In response to the member's question, we are considering the options that are available to us to improve animal protection in the Yukon. We have not yet had an opportunity to discuss this in Cabinet and so have not set a schedule.
Mr. Cable: The Yukon legislative backdrop to animal protection is sort of a mishmash of unintegrated statutes. Would the minister confirm that she intends to bring forward an omnibus bill that will cover all animal protection issues in the Yukon? Outside the Criminal Code, all issues over which this government has jurisdiction can be dealt with by integrating all these statutes. She's clearly not prepared to tell us when she's prepared to bring this legislation forward. Would she tell us if she is prepared to bring this legislation forward?
Hon. Ms. Moorcroft: Mr. Speaker, there are a number of options available to us which include an omnibus bill and include better enforcement of the existing legislation. As I said in response to his first question, we have not discussed this item in Cabinet or made a decision yet.
Mr. Cable: Well, that's the same story we got back in December, which is three or four months ago.
Now, there has been an interdepartmental committee struck by the previous administration to deal with the issue, and this was the better part of a year or so ago. The committee was to be coordinated by the Department of Justice. Has this committee reported to the minister as yet?
Hon. Ms. Moorcroft: Thank you, Mr. Speaker. I have looked at work that the Department of Justice has brought forward on this subject. I am sorry that the member is disappointed that we have not been able to come forward with legislation in the last six months. I can tell the member that we will consider the options available to us and, when we have made a decision regarding timing and what action we are going to take, I will be very pleased to announce it in the House.
Speaker: The time for Question Period has now elapsed. We will proceed to Orders of the Day.
ORDERS OF THE DAY
OPPOSITION PRIVATE MEMBERS' BUSINESS
MOTIONS OTHER THAN GOVERNMENT MOTIONS
Clerk: Motion No. 54, standing in the name of Mr. Ostashek.
Motion No. 54
Speaker: It is moved by the Leader of the Official Opposition
THAT it is the opinion of this House:
1) the Yukon government should reconsider the agreement in principle reached between the Yukon Energy Corporation and Alberta Power Ltd. which includes the sale of $4 million of Yukon Energy Corporation assets in contravention of a long-standing commitment by the Yukon New Democratic Party to oppose the sale of such assets to southern interests;
2) the agreement through such provisions as a 20-year franchise for the Yukon Electrical Company Ltd. for residential and commercial customers will seriously impede the government's ability to use energy as a tool for economic development; and
3) the agreement will lead to the increased use of expensive and environmentally harmful diesel for energy generation and will do nothing to reduce the high energy costs to Yukon's electrical consumers.
Mr. Ostashek: Mr. Speaker, this
is a very important and very timely motion in light of what has been happening with energy in the Yukon, and what we believe on this side to be a crisis situation, even if the minister doesn't believe it's a crisis situation.
The motion is not a hostile motion in any manner whatsoever. We're merely asking Cabinet to go back to the drawing boards and seriously consider what position they are putting Yukon ratepayers and Yukon taxpayers in by divesting themselves of some assets.
I have some difficulties with the position that was put forward by the NDP prior to the election and the position that the NDP government is taking today. Mr. Speaker, I could probably say that the NDP party prior to the election led Yukoners down the proverbial garden path, because their position has changed quite dramatically now that they are in government.
In order to fully debate this, and so Yukoners fully understand what our concerns are and why we put this motion forward, I think it's important that we go back and put on the record one more time comments made by members opposite when they were in Opposition, and to the position they took on divesting themselves of any assets of the Yukon Energy Corporation, and then I want to talk about the crisis situation that we're in in the Yukon today. And then I would like to offer some options that the minister ought to consider to try to get this thing back on track.
During the last administration, when we were in government, there was a motion put on the floor by the Member for Riverside in regard to a comprehensive energy strategy initiative - a motion that was never debated. But, I did prepare for the motion and I have some speaking notes. I just want to open by going through the first couple of paragraphs of the speaking notes, because they pertain to the issue today, as well as they did when the member put the motion on the floor, because this is referring to eight years of NDP administration, up to 1992, and where they were with energy in the Yukon when the Yukon Party took over government.
I think it is very important that we set the record straight on that former NDP administration's perspective regarding the energy sector and the development of a comprehensive energy policy. Now we are faced with a new NDP administration, after doing hundreds of thousands of dollars of work on a comprehensive energy strategy, spending hundreds of thousands of dollars again by appointing an Energy Commission to go back to what I believe is square one and start over again. I think this is a great expense to taxpayers.
This was the government - the NDP government - that, after buying the assets of NCPC, found out that the system was in such poor repair that it required over $40 million in upgrading during the first five years of operation. This was the government - the previous NDP government - that agreed to subsidize rates to the Curragh mine by raising rates to other customer classes, an action that has caused rate structure problems that we are still dealing with today. Even four years after they were out of office, we were still dealing with it. We are still dealing with the problems of that subsidy.
This was the same NDP government that created a regulatory regime that was total disproportionate to the size of the utility being regulated, at a cost to Yukon ratepayers of more than 10 times, on a per customer basis, any other province in Canada. This was the regulatory system that was put in place by the previous NDP administration. Now we hear in the throne speech that they are going back to review the streamlining that was done by the Yukon Party government; one that was done on a consensus basis and reduced the cost of the hearings dramatically.
This previous NDP government zealously preached the virtues of renewable energy, but, in eight years in power, they did not add one single kilowatt of hydro-based energy to Yukon's electrical system.
It was the same NDP government that took pride in its support of alternate energy, yet, again, in eight years they never added one single kilowatt to the grid. But, during that same eight years, that same NDP government approved the installation of new diesel generators in Whitehorse, Faro and Dawson City.
But, let's be fair to that previous NDP administration, Mr. Speaker, and I will grant that it's true, that as the Member for Riverside suggested in his motion, the former NDP administration did launch into a two-year planning initiative designed to produce an energy strategy for Yukoners.
Staff from the Department of Economic Development conducted consultation in most Yukon communities, an energy strategy was drafted and reviewed by all stakeholders, then it was redrafted and sent to Cabinet for approval - and there it sat.
Two years of planning and consultation wasted, because the government of the day, the previous NDP administration, didn't like what Yukoners had to say about energy.
And, what did Yukoners have to say about energy, Mr. Speaker? They said, "Give us affordable electricity." They said, "Give us power for industry", and, Mr. Speaker, the crux of the motion we're debating today, "Give us a chance to buy in."
With the AIP that's in front of Yukoners today, they don't have a chance to buy in. We have Alberta Power being given the chance to buy in, but not Yukoners.
So, Mr. Speaker, those words then are just as valid today as they were when they were drafted, and I will refer to this document further on, on some of the actions that we took when we were in administration to try to pull this all cohesively together and now why we're so dismayed to see this administration basically going back to square one, with a very costly process of consultation, when it's all been done before. There have been years and years and years of consultation. Yukoners now want some action.
We, during our mandate, released an energy plan, and it was criticized by members opposite because it was being done on a sector-by-sector basis. Yet, I sit here in this Legislature today and I hear the commissioner get up and promote the very same thing - the very same thing, to do it on a sector-by-sector basis. Yet, in Opposition, that was just not acceptable to the members opposite.
The Member for Kluane says he wasn't in Opposition, but he was certainly on the soapbox of a lobby group with the Friends of Aishihik, Mr. Speaker.
I believe it's very important that the position that members opposite in the NDP took when they were in Opposition goes back on the record, and I want to go back to comments made by the Member for Faro, the Member for McIntyre-Takhini, the former NDP leader, Mr. Penikett, and probably other members who sit here, too. A lot of these comments are on debates that were in this Legislature when they were accusing us, in government, of the very actions that they are promoting today: divesting the Yukon Energy Corporation of assets to a "southern-based millionaire", as Mr. Penikett put it.
I just find this mind-boggling.
Then, along with all this, we hear Yukoners waking up every morning and wondering what's happening, because every day or two there's a new statement by the minister. First we have a $4 million shortfall, then we have a $6 million shortfall. My God, this morning, we're going to have a $10 million shortfall.
God, I mean, we had better quit asking questions in Question Period, because every time we ask some questions, it goes up another $2 million or $3 million.
I don't think the minister has told Yukoners the whole story yet, because in a briefing by the president of the Energy Corporation, I believed he relayed to us that there was $14 million in outstanding bills and liabilities that potentially could happen over the next year, and the profits are only going to be some $6 million or $7 million. It isn't going to be able to cover it.
So I suggest to this Legislature, and to all Yukoners, hang on to your toques, because the increase isn't going to be 20 percent. It's going to be 50 percent or 60 percent by the time this administration is done.
Mr. Speaker, I want to refer to A Better Way, the NDP campaign document. New Democrats believe that energy is a key to the development of the Yukon, and a major tool for Yukon energy supply is the Yukon Energy Corporation, and it is its responsibility to develop the Yukon. That's right from their Better Way document.
They go on to say that Yukon homes and businesses need reliable, reasonably priced energy, and New Democrats are committed to providing it through a strong public utility and better ways to create energy.
It goes on to say that an NDP government led by Piers McDonald will stabilize electrical rates to keep them affordable for residents and small businesses and improve the rate subsidy program to Yukoners so Yukoners can have a greater share of the profits of the Energy Corporation.
Laudable goals, Mr. Speaker, had they acted on them.
What have we seen in six months of an NDP administration? We've seen energy rates go up by almost 10 percent - nine-point-some percent - and now we hear that they could go up another 50 or 60 percent before this administration is finished.
Mr. Speaker, they go on to say in here, "Maintain local control of energy resources through public ownership of the Yukon Energy Corporation while exploring investment opportunities with Yukon First Nations and municipalities." Then they go and announce an AIP, which, regardless of what the Member for Kluane says, has given a private Alberta corporation - one that that member despised when he was in the private sector and fought bitterly against at every rate hearing there was in the Yukon-
Point of order
Mr. McRobb: Point of order, Mr. Speaker.
Speaker: The Member for Kluane, rising on a point of order.
Mr. McRobb: Mr. Speaker, the Leader of the Official Opposition is promoting innuendo and aspersion against me at a time when I was a private member of the territory, and he is alleging that I had great hatred for an investor-owned company, which is certainly not true. I would challenge the member to make those statements outside of this Legislature, where he does not have the legal protection to do so.
Speaker: On the point of order, please.
Mr. McRobb: Mr. Speaker, the member should apologize for the remarks he has made.
Mr. Ostashek: On the point of order, Mr. Speaker, it is a known fact in public, in documents, in news documents, that that member fought bitterly against YEC and YECL on every rate increase that was put forward in the territory. He was on a mission. And this is not an aspersion of any kind. This is a statement of fact, that that member is on the public record as being against anything that those corporations tried to do.
Speaker's ruling
Speaker: Order please. Order. The remarks that I have been asked to make a ruling on really fall into the class of remarks that represent one perspective, and indeed I would rule that the remarks are of a nature of a matter of being a dispute, I guess, of perspective between various members in the House. They are the kind of remarks that are going to occur from time to time. I would caution against the use of particularly strong language, nevertheless, and ask that the debate proceed.
Mr. Ostashek: Thank you, Mr. Speaker. I was relaying, when I was interrupted by the point of order, commitments made by the NDP in their campaign platform, A Better Way. They also stated in there not to undertake any high-cost, high-risk, high-debt projects without major customers to pay for them. Now we hear quite the opposite. We hear that they may even be amenable to subsidization for the Faro mine. So, we don't really know where this minister is coming from.
I want to go back now, because it's important that Yukoners decide for themselves if, in fact, this government has changed their position from when they were in Opposition to what they're telling the Yukon public now. So, I need to go back through some of this debate and I won't try to bore the Legislature with the entire debate, but I'm going to pick out key clauses and read them into the record, Mr. Speaker.
I go back first of all to November 22, 1993, on a motion for the production of papers by the hon. Mr. Penikett of the day, and it was in relation to papers drawn up between the Energy Corporation and the Development Corporation Board. What the hon. member, Mr. Penikett, the Leader of the NDP, said at the time was, "The minister's pronouncements are in the form of statements of government policy since the takeover bid by Yukon Electrical Company." And he says those takeover bids were not new. He says, and these were his words, Mr. Speaker, "They tried it when the NDP was in power." He wanted to know from the minister who initiated the secret but informal discussion. It was very similar to the secret discussions that are going on now in regards to the AIP, but the government had campaigned on open government and transparency.
Yet, they didn't consult with anybody on it.
At that time, they were accusing us, as I said earlier, of divesting ourselves of assets of the Energy Corporation - not all of the assets; some of the assets. Mr. Penikett went on to say at that time, "For the record, my bias is in favour of northern people owning the electrical utility, rather than a southern corporation. Since the Yukon Party has no mandate whatsoever to give away control of this valuable public property, not to a Calgary multi-millionaire, will the Government Leader assure us that the Yukon Energy Corporation's assets will not be privatized without the Yukon Party first receiving either a mandate from the Yukon people by way of an election or a referendum on the question."
Mr. Speaker, I do not recall anywhere in the documents by the NDP, prior to the last election, that they were going to move even a very short distance towards the privatization of the assets of the Energy Corporation. They didn't tell the Yukon public that and they didn't receive a mandate from the public to do it.
We said that if a deal was struck between Yukon First Nations - another level of government that we were talking about at the time, not privatization - that our government would consult with Yukoners on the arrangement. This minister and this government today did not consult on the AIP. They are going to consult after the fact.
The Leader of the Official Opposition at the time, Mr. Penikett, said, "I am pleased to have extracted that small concession from the Government Leader." And, he went on to say, "I would like to ask him this:" and he says, "Mr. James, a respected citizen and a former commissioner and a former chair of NCPC has argued that before disposing of such valuable public property there should be a public inquiry", and he asked me if I would consent to that.
Mr. Speaker, we also know that this government, in reaching an AIP, did not follow the terms of reference of the umbrella final agreement. They did not consult with First Nations. They are going to consult with First Nations after the fact that they have reached an AIP. We do know, also, that First Nations representatives at the board were very vocal and very concerned about the actions of this government. We know that for a fact. I believe that this is an area where this government has really gone off track when they told Yukoners that they would provide an open and transparent government, and Yukoners would be consulted in major decisions.
The issue of rationalization is not new. It was started by Mr. Penikett back in 1987 when they took over NCPC, but he also backed away from it. He wouldn't go through with it, because he said it was wrong and, you know, the debate went on and on and on here in the early days of our mandate, when Mr. Phelps was the minister of energy, about privatization or divesting any assets from the corporation to private hands.
Mr. Speaker, the point I'm trying to make here is that if you go back through all of the record here, no matter which debate you get into, you'll find clauses that the NDP have been very vocal and adamant, including the Member for Faro, and including the now-Government Leader, that there ought not to be any assets of the Energy Corporation disposed of.
The minister is shaking his head, but I will find the clauses in here in the debate today, Mr. Speaker.
They even went on at the time the Faro mine shut down, and Yukoners were faced with a rate increase, and we did bring in the rate subsidy program - regardless of what the minister says today - and we did make a commitment prior to the election to extend it - regardless of what the minister says today. They put a motion on the Order Paper and debated that motion that in fact they should cut the rate of return to five percent for the Energy Corporation. Then, we hear the minister saying in January and February of this year that the corporation needs to have funds coming in, because they have obligations to meet and cannot continue to operate the utility.
So, I mean, there's been no consistency in what the members opposite have said about their position on energy. Now, the minister states that - he has stated so many different things, I really don't know what he means any more or what the final figure is. There's a large discrepancy between what he is telling the public and what the president of the corporation told us in a briefing.
Mr. Speaker, they now are going to go to another rate hearing, is what they're saying they want to do, because it'll probably end up being 50 or 60 percent, the way this government is moving and the string of announcements that's coming out, first by the minister, then by the president, then by the minister, as to what the financial shape of the corporation is.
I heard the minister in Question Period here the other day chastise the Member for Riverside, saying that he was overreacting, that there wasn't a crisis at the Energy Corporation. There was a little bit of a cashflow problem, yet twice since then, the minister's made announcements that the problems got bigger and bigger and bigger. And I suggest to you, as I did earlier, Mr. Speaker, that it's going to get bigger yet, before the final figures are in.
Some Hon. Member: (Inaudible)
Mr. Ostashek: Oh yes, you wish my time was up. Mr. Speaker, he wishes my time was up.
Some Hon. Member: (Inaudible)
Speaker: Order.
Mr. Ostashek: Thank you, Mr. Speaker.
Again, on the Energy Corporation, Mr. Penikett got it right. Yukon people have not been involved in these discussions at all, and yet we know that the minister has had private conversations with the Energy Corporation. These guys are doing exactly that now.
I mean, it's no different. They were very critical with us. Mr. Penikett again: "The Yukon Party and the government opposite has no mandate to integrate the management of the electrical company and the Energy Corporation."
I say this government doesn't have any mandate to dispose themselves of any of the assets of the Energy Corporation, Mr. Speaker. They didn't campaign on it. If they felt so strongly about it, why didn't they tell the Yukon people that they were going to do that?
Mr. Speaker, the then Leader of the Official Opposition, Mr. Penikett said, "I would like the Government Leader to show me a single instance, anywhere in the world, where privatizing the utility has lowered power rates for the consumers."
Well, I'll say to the minister now, he may not have privatized the whole utility, but he's certainly moving in that direction, and what he is doing by the actions he has taken is allowing the private corporation, the multi-millionaire that they so disliked in Alberta, they're giving him a rate of return on another $4 million worth of Yukon ratepayers' assets.
That's what they're doing, Mr. Speaker - something that they were totally against when they were in Opposition, and not only when they were in Opposition, but when they were in government before, from 1985 to 1992, they wouldn't carry through with rationalization of any kind.
So, Mr. Speaker, I will just go through these and I will get down to where we have statements by the Member for Faro and the Member for McIntyre-Takhini on this very issue.
There are some areas that I just find mindboggling because, as we heard the Member for Kluane say in his presentation today, even though they were giving YECL a 20-year franchise, they could still deal with the municipalities for distribution. I find that statement mindboggling. If we're going to give one private corporation a franchise for 20 years, that's a licence to print money for 20 years on the backs of Yukon ratepayers, a guaranteed rate of return, and they've done this, and the only part of the asset base of the corporation has grown -
Some Hon. Member: (Inaudible)
Mr. Ostashek: The minister's trying to hide behind the board again, Mr. Speaker.
We know, and the minister knows, whose decision it was to put us in this position. It certainly wasn't the board's decision.
Some Hon. Member: (Inaudible)
Speaker: Order.
Mr. Ostashek: At that time, even though we weren't privatizing the assets of the Energy Corporation, we were trying to merge them into one corporation, a Yukon corporation, and the NDP Opposition spun it that we were trying to divest ourselves of the assets, and they were against it. They were against divesting themselves of any assets.
Some Hon. Member: (Inaudible)
Mr. Ostashek: Now the Member for Kluane is saying, "Sellout." I'm saying the same thing to him. It's a sellout. It's a wholesale sellout.
AYC even said that they didn't believe that that was a proper way to go, that we needed to explore other avenues as to how we could reduce the cost of energy, and this is what we were trying to do, Mr. Speaker. The merger of the corporation into one corporation in the Yukon was to have lower costs for ratepayers. I see nothing in the agreement in principle that has been negotiated by this administration that's going to have an impact on lower energy rates for Yukoners.
I hope the minister, when he gets up to respond in this debate, will lay out quite clearly and succinctly for Yukoners how this is going to lower their power bills.
Some Hon. Member: (Inaudible)
Mr. Ostashek: I will speak of that $2 million later in my debate, Mr. Speaker, because that's a fantasy in the minister's mind.
Some Hon. Member: (Inaudible)
Mr. Ostashek: Hours and hours, Mr. Speaker.
I do have unlimited time.
Mr. Speaker, Mr. McDonald, in speaking to the same issue of YEC and First Nation and YECL merger -
Some Hon. Member: (Inaudible)
Mr. Ostashek: What I am doing is putting on the record things that members opposite said so that the public is fully aware of how they have changed their position now.
Mr. McDonald, the Member for McIntyre-Takhini in this Legislature, asked, "Can the minister give us a commitment that no final arrangement will be struck and no agreements will be struck before the Legislature has had a chance to review the terms of the arrangement and the principles behind the arrangement and whether the agreement between YTG and CYI or between YTG and AYC or Alberta Power and YECL... Will the government give us a commitment that they will discuss and debate this agreement before any agreements are signed?"
Well, Mr. Speaker, this government didn't give this Opposition that opportunity, yet that's what they were asking for in Opposition. They were asking for a full debate.
Why two different positions? This is not that long ago. This was on February 15th, 1996. If this is the way they intend to go, then I believe they ought to have given the courtesy to this Legislature that is sitting now a chance to speak on the AIP before they signed it. They ought to have done as the now Government Leader, who was the Leader of the Official Opposition said we should do on August 8th, I believe, last year when he wrote me a letter and said that there needs to be more public consultation on this. He said that the consultation that I did last summer with the Department of Economic Development and Yukon communities was not enough, that we needed more debate on this issue. Yet, they haven't done it. Why?
Why have they not done it, Mr. Speaker?
Mr. Speaker, what we have happening here now - what I believe happened - is that they had a management agreement that my administration wasn't too happy with. I don't believe the NDP administration was too happy with it either or they would have just signed it. They had that opportunity. They could have signed it. They were looking for a better deal, but I'm sorry, I don't believe they got a better deal. I think they got a far poorer deal than Yukoners had before.
And, as a result of that, we're going to see more and more assets ending up in the hands of the private corporation, because the distribution system is growing much faster in the Yukon than what the generation system is, and it will continue to do that. So, by divesting themselves of $4 million worth of, as the Minister likes to put it, poles and wire - downplaying the ramifications - it's just not accurate, because they're also talking about divesting themselves of the diesel generation in Dawson City. They're talking about divesting themselves of the backup diesel in Mayo.
So, what will be the final amount of assets they divest themselves of? It will certainly be far greater than $4 million. My understanding is, from the briefing we've received - and I'm sure that we will have many more questions for the president tonight - is that this agreement of principle is contingent upon a couple of other things, and one of them is a 20-year franchise for this multi-millionaire in Alberta.
I think the ironic part about this, Mr. Speaker, is it's given to him by an NDP government - given to him by a multi-millionaire - I'm sorry, I didn't mean to say that the minister was a multi-millionaire. I meant to say that it's given by a minister to a multi-millionaire businessman.
There's just no consistency to what this government stands for. We've seen it on other issues since this administration's taken over. I think that they've got a real credibility problem that they're going to have to overcome with the Yukon public to find support for their actions. I just find it mind-boggling that we would have an NDP government taking these kinds of steps.
I don't think there's anybody in the Yukon public who would have thought that the NDP government would even consider selling $1.00 worth of assets of the Energy Corporation, let alone $4 million, and probably $7 million or $8 million by the time we get rid of the diesels in the two communities.
Some Hon. Member: (Inaudible)
Mr. Ostashek: I hear the Member for Whitehorse West talking about rationalizing assets. We'll speak about that a little bit, because there is nothing left in here that's rationalizing assets. This is selling out assets. This is what this is doing.
On April 3rd, 1996, there was a motion in this House by the Opposition that was talking about a current energy policy and things we were doing, and I just want to put on the record some of the comments made by the now leader of the government, and I believe there are some in here that are attributable to the Member for Faro.
The Member for McIntyre-Takhini, when speaking first to the motion said, "The only thing we have seen happening - into which there has been any real political energy invested - was the initiative early in the mandate of the Yukon Party to privatize our utility. Having backed off from that particular initiative and having found no obvious partners in seeing to it that our utility is sold off to other interests - we are obviously expressing the most concern about selling it to southern interests..." Here we go again. Then he goes on to say that we see that - this is the point that I'm trying to make in here, Mr. Speaker, because I've spoken several times in this debate to what the Member for McIntyre-Takhini said - "We see the manager for Yukon Electrical Co. Ltd. signing in the signature block for the Yukon Energy Corporation on letters that are also on Yukon Electrical Co. Ltd. letterhead. We see the rate base of Yukon Electrical Co. Ltd. skyrocketing from around $12 million in 1987 to $40 million-plus - an increase", as he puts it, "of almost 300 percent - since the time the NCPC assets were transferred."
"We see the Yukon Energy Corporation's rate base only increasing marginally."
"We see a so-called rationalization of the Yukon Energy Corporation's assets and respective responsibilities, both in how it is managed and in its asset base."
"On another point, we have seen a lack of leadership when it came to the whole subject of energy rates. What have we heard from the government?"
Mr. Speaker, again, here is the now-government pointing out that the asset base of the private corporation grew at a rate of 300 percent from the time we took over NCPC while the asset base of YEC only grew a very small amount.
Mr. Speaker, those are the areas where we have the greatest concern with the position that is now being taken by this government when they were so vocal in Opposition. And I have now a few statements attributable to the minister responsible for the Energy Corporation - when he was in Opposition as the Member for Faro - on April 3rd in this same debate saying that they had invested heavily in conservation programs and, in fact, the fact could not be ignored that they actually devolved control "- Yukon for Yukoners - of the power corporation." Now they're giving it away.
"Let us look at the Yukon Party's vision ... where ... "it saw two extremely large power rate increases for residential consumers..." Well, Mr. Speaker, here we are six months into this government's mandate and we've already seen two huge increases, even along with rate relief. Thanks to us, he says. Thanks to us, Mr. Speaker.
The minister, when he was in Opposition, had all of the answers for what we should do and now that he's in government, he hasn't got any answers.
That's what we were hearing from him on the Opposition benches; it was nothing but political rhetoric.
Some Hon. Member: (Inaudible)
Mr. Ostashek: Yes, the minister responsible for power rate hikes is right.
"It is clearly apparent that Yukoners are not interested in giving away the hard-fought-for power corporation to the Yukon Party's southern friends." Wow, Mr. Speaker.
I wonder if you asked Mr. Southern now who his friends are, who he would say, because the Yukon Party was fighting a hard fight to retain those assets for Yukoners. We were going to retain those assets for Yukoners, while this government is selling them off.
Some Hon. Member: (Inaudible)
Mr. Ostashek: Sellout is right. So, for the minister to now come along and say to us that they're not changing their position, they've committed to stabilizing power rates at affordable levels, well, I guess maybe he's going to stabilize them at an affordable level that he feels is affordable to people who ride business class in airplanes. I don't know, it's certainly not Yukon consumers that can afford them.
Some Hon. Member: (Inaudible)
Mr. Ostashek: It's certainly not going to... Well, he's committed to stabilizing them somewhere, but he's never-
Speaker: Order.
Order please.
Mr. Ostashek: Yes, thank you, Mr. Speaker, there is quite a bit of kibitzing from the Opposition benches.
I know this hurts; I know this hurts them, because they have taken such a different view now that they're in government from where they were in Opposition and where they were when they were previously in government. They did nothing for eight years to try to relieve the Yukon ratepayers of getting off the very expensive diesel fuel.
The Member for Kluane will get his turn to speak, Mr. Speaker. We moved a long way ahead. We see that even the cartoons have got him in the dark now. See? They're starting to pick it up. People aren't going to be able to afford to pay their power bills.
You know, it's probably pretty interesting for us over here. We can sit here and joke a little bit because we know how hard the Member for Kluane fought to keep power rates low in the Yukon; now he's part of a government that's raising power rates. It's quite ironic.
Some Hon. Member: (Inaudible)
Mr. Ostashek: No, now it's not the government that's responsible, it's the Energy Corporation now, but it was always the government's fault before.
I have laid out enough of what they said in Opposition. I think anybody who reads Hansard or is listening to the debate will be able to make their own decision as to whether the NDP of the day has changed their position from what they campaigned on a mere seven months ago. I don't think it would take a rocket scientist to figure out that the position has changed quite dramatically.
I do want to carry on to where we're at today and the problem that is really facing Yukoners and why I see this as such a serious matter. As I said, as I was having a cup of coffee this morning and listening to the newscast at 7:30 a.m. I heard the minister come on there and say, "Well, it probably won't be $6 million; it could be $10 million that we're short."
Some Hon. Member: (Inaudible)
Mr. Ostashek: That was this morning. Tomorrow, well...
The minister is responsible for the Energy Corporation, no matter what he wants to say. Regardless of the shortfall at the Energy Corporation, the minister is briefed, I know. If he isn't, it's because he doesn't want to be briefed. For a minister to make so many contradictory statements in the last week is mind-boggling. He doesn't know the extent of the problem. He criticized the Member for Riverside for being an alarmist, and then he comes out every second day and says, "Well, they may have to go up more than 20 percent."
Unbelievable.
If the minister was doing his job, he would have had a full - Mr. Speaker, the president told us at a private briefing that it could be as high as $14 million. I'm sure he told the minister that. Why doesn't the minister just come clean and tell the public all at once how big the problem is and let's work on solving it?
Now, he says he doesn't know what we're talking about. I can understand that, Mr. Speaker. I can understand that he doesn't know what he's talking about, because he keeps changing his position.
He said the other day, when I said something about using the $10 million reserve that was in YDC, that there is no $10 million. That's what he said in Hansard here, on April 7th, 1997, "There's no $10 million", yet the president of the Energy Corporation told us it was there.
Some Hon. Member: (Inaudible)
Mr. Ostashek: Okay, so $8 million. Is that what you're picking about? Eight or $10 million.
Some Hon. Member: (Inaudible)
Mr. Ostashek: "Oh, we just made $2 million profit by selling the assets of YEC," he said. There's a substantial amount of money in YEC that was there for infrastructure development and this minister is going to use it up to try to avoid raising rates, and he's going to get Yukoners into a bigger problem yet.
I want to talk a little bit now about that $10 million. Back on January 20th, 1997, and this was the same minister, Mr. Speaker, in an interview with CHON-FM, number 2 story today: "Meanwhile, Yukon Electrical Ltd. has been told it cannot have the last two feet of water in its licence that it allows it to take from Aishihik Lake." Political interference in my opinion. A perfectly valid water licence that this administration politically interfered in, at a cost of - the last figure we had was $4.7 million - and it's probably going to be a lot more than that - to the ratepayers of the Yukon. But the minister went on to say that day that that was an environmental promise they made. He said, "The electrical company may lose up to $3 million." Well, again, the minister was inaccurate in his statements because the briefing we received from the president a week ago was $4.7 million.
Now, this is January 20th, Mr. Speaker. It's not that long ago.
But they can't use the water. But the minister promises consumers won't be hit for the difference. Instead, he says it will come out - and, Mr. Speaker, I want the minister to listen to this - of approximately $8 million the Development Corporation has socked away. That's what the minister said here. Then he says, the other day, there is no money there. That's what he said. That's what he said; splitting hairs, Mr. Speaker, splitting hairs.
Again, in an open letter he wrote to me in the paper on March 3rd, he goes on to state, "I would like to remind you that electricity rates are set by the Utilities Board following public hearings, not by the government. The Yukon Energy Corporation has not sought higher rates from the board because of increased diesel use." These words will all come back to haunt the minister.
Mr. Speaker, the decision not to use the allowable water in Aishihik Lake was a short-term fix for this government that was very, very costly for the ratepayers of the Yukon. As I related, I believe in Question Period during debate here the other day, six inches of water in Aishihik Lake relates to $2 million worth of power.
Some Hon. Member: (Inaudible)
Mr. Ostashek: "It's not costing the ratepayers," the Member for Kluane said. Come on, I can't believe this. I can't believe this.
Speaker: Order please. Let's let the member proceed with his debate.
Mr. Ostashek: Mr. Speaker, here's the member saying that profits are not a cost when in fact he intervened, I believe, on every rate application there was here and did say, in fact, that profits were a cost. My God.
In an interview here that the minister made with Greg Ralston of the Yukon News, he says, in talking about the decision to use more diesel and not to draw down Aishihik Lake, "Paramount in this decision is a commitment that ratepayers will not bear the brunt for this decision," the minister said. My God.
Mr. Speaker, I just want to again point out the inconsistencies between what this minister says one day and what he says the next day or what his president of the corporation says, because I believe this goes back to the minister saying that it was a board decision not to drain Aishihik Lake.
Well, I'll refer the minister to Friday, January 17, 1997, where the president was being interviewed on CBC, on the 7:30 news, the president of the Energy Corporation, Rob McWilliam, says, "He's turning the issue over to the government, with a list of pros and cons of lowering the level."
Mr. Speaker, the decision not to lower Aishihik Lake was a political decision, and maybe the board endorsed it after the fact, but the board didn't do it first. It didn't come from the board. It came from the government.
I'll go back to December 27, when Roger Rondeau says that, "They've been taking it and then they're going to have to give it back. That would be a decision for the Yukon government." YEC President Rob McWilliam said Tuesday. Again, that's referring to the draining of Aishihik Lake. So, you know, there's no doubt it was a political decision and the members opposite ought to accept responsibility for it. This was February 27 - power rates will jump in February. That was the second increase.
As a result of that, Yukoners have been faced with two increases now and many, many more are going to happen because of the actions taken by this government in negotiating the AIP with the southern-based corporation, Alberta Power.
Again, Mr. Speaker, just in summing up where this government came from, I think it's all encapsulated in the letter I received on August 8th, from the now-Government Leader who was the Leader of the Official Opposition at that time, saying that there ought to be full, public debate before any decision is made. He did not feel that the assets should be sold off. In fact, he goes on to state in this letter, "The publicly owned utility YEC initially owned 91 percent of Yukon's energy-related assets, with the remainder held by the privately owned YECL. YECL's share of Yukon energy assets has since risen to approximately 22 percent, while YEC's has gone down to 78 percent." All the more reason why government ought not to be divesting themselves of any more assets.
If, in fact, this agreement stands up, we're giving a private corporation a 20-year franchise that will stop anybody else from distributing power in the Yukon - or we're going to have to expropriate them at a very, very, high cost - except that we do have the five-year escape clause for the three communities that they've sold off now.
At that, five years from now, I can assure the members opposite that that asset base will be quite a bit larger than what it is today. So we'll be paying more money for it when we buy it back.
What they've basically done by selling that $4 million worth of assets is taking the regulated return on investment that Yukon ratepayers were getting for that $4 million and giving it to a private corporation that's going to take the profits south, as the NDP has always said in the past. That's what they've done.
Now the member says we're going to reinvest it. Well, it's going to take some time for them to reinvest it.
Some Hon. Member: (Inaudible)
Mr. Ostashek: Maybe not too long, though, because we now hear the Member for Kluane saying they're going to be exploring coal. I said that the other day: it wouldn't be long until they'd be promoting coal. I just can't believe it, the flip-flop of this government.
Some Hon. Member: (Inaudible)
Mr. Ostashek: I think it'd be great if they explored coal, because there are many jobs for many Yukoners there; many investment opportunities for First Nations and everybody else.
Some Hon. Member: (Inaudible)
Mr. Ostashek: Come on. I mean, this is just so mind-boggling to the Yukon public.
Again, Mr. Speaker, I just want to say that it's all summarized in this letter of August 8 - I won't bother tabling it because it was tabled the other day - that this government has consistently maintained when they were in Opposition and when they were in government before, that absolutely none of the assets of the Energy Corporation should be sold off to private interests. That's what they've told Yukoners, Mr. Speaker, and now they have decided not to go ahead with that position that they so firmly campaigned on and told Yukoners that that's what they stood for. They have now taken a different position.
What I want to say here, Mr. Speaker, when I watch the actions of this minister and the YEC saga over the last two weeks, it makes the Bre-X situation look like kid's play. I would suggest to the minister that he not take any helicopter rides in the next few weeks.
Some Hon. Member: (Inaudible)
Mr. Ostashek: So, Mr. Speaker, what are we faced with? We're faced, from what I can understand, with possibly as much as a $14 million shortfall in the Energy Corporation. The minister does not call it a crisis. The president of the corporation came out and thought it was a very serious situation. He said we need a rate increase; the sooner the better. Those were his words in public.
Now with the Faro mine down and owing - what is it now? Is it $5 million yet, or is it going to be $5 million tomorrow? It was $4-point-something million this morning, so I think that probably by tomorrow it'll be $5 million or something.
But not only that, we hear from the minister, we hear from the Government Leader and we hear from members on the benches about the Faro mine going back into production very quickly, yet, from what I understand now, they are no longer a customer of YEC at all and they are going to generate their own power. That is what we understand now. They are no longer buying power from YEC. They are going to go back to generating their own power, as they did during the Curragh shutdown. It is because of the demand charges that are paid. Well, the minister can correct the record if he says I am wrong in that, if, in fact, he knows that Anvil Range is still buying power.
Some Hon. Member: (Inaudible)
Mr. Ostashek: Mr. Speaker, the members opposite are saying we did nothing. We did a lot of things to put Yukoners in a position where they could deal with the situation. There are only two things that are going to solve the problem in the Yukon. Rate subsidy isn't going to do it. Using up the $8 million or $10 million from YDC is not going to do it. NDP governments have been notorious for using up those dividends from YDC. Selling off the assets is not going to do it. None of these things are going to do anything to reduce power rates to electrical consumers in the Yukon.
I suggest to the minister opposite that there are two things we need, something that he ridiculed severely during the election, and that is grid expansion. We need to invest. We need to make long-term investments.
I don't know if we have to draw a diagram for the minister or what. We've got $1 million worth of diesel fuel going over the dam every year at Mayo, since 1989. That is eight years.
Some Hon. Member: (Inaudible)
Mr. Ostashek: Well, we were in a position - we said we were going to build a grid. We said we would. There was a commitment, Mr. Speaker. We said in the election campaign that we were going to build a grid to the Mayo dam. They ridiculed us.
If they had any business knowledge at all, a grid, amortized over 50 years - which should last longer than that - even amortized over 30 years, that is about what the cost of the grid to Mayo is. Just the savings on diesel fuel alone over a 30-year period would pay off the grid. That is not a big figure. Besides, they would have taken two more communities off diesel fuel.
You don't do it all at once, but had a previous NDP government started putting in a little bit of grid instead of spending the money on adventures into the private sector when they were in power before, they could have build quite a few miles of grid at a lot cheaper price than what we would have had to pay today.
I think it's a good investment, and it's also a way to start looking at reducing the cost of power, but in order to reduce the cost of power, we have to get off diesel fuel. As long as we're at the mercy of the world price of diesel fuel, we are going to be paying high power rates in the Yukon. We are going to be putting out a disincentive for businesses to locate here. There is going to be no major expansion because of the high cost of power.
Every business you talk to says they need three things: good highways, good telecommunications and reasonably priced power. The one thing we are lacking in the Yukon is reasonably priced power, and I don't think the members opposite over there can sit there and say that they believe that the power is reasonably priced now. In fact, governments in the past - and my government is just as guilty of it because of pressure from the public and pressure from the Opposition to put in rate relief - have been guilty of hiding the true cost of power to Yukoners. As long as we continue to do that, there's going to be no pressure on government or the Energy Corporation to find a cheaper source of power. We not only provide rate relief, we have hidden subsidies where the government, I believe, pays 145 percent of the cost of service. Well, those realities just cannot go on, and we cannot - I don't care what short-term actions the minister takes, what little pools of money he draws from that he has now for a quick fix - solve the problem. We need to look at some long-range investments in energy.
I go back to the three things that Yukoners said to a NDP government in 1991, when they did their energy policy. They said, "Give us affordable electricity, give us power for industry, and give us a chance to buy in." Now, Mr. Speaker, in this new arrangement with Alberta Power, Yukoners are not getting any of those three things - not one of the three things are they getting.
We have heard the kibitzing from the members opposite that we didn't do anything. Well, we did a lot of things to try to set the stage to where - had we got another mandate - we would have been moving very, very quickly to do some things that would eventually bring down the cost of power in the Yukon. One of the first steps we took was to redefine the mandate of the Energy Corporation and limit its operation to energy-related matters. As a result of that, we were able to utilize - give the minister his figure - $8 million over a period of four years as well as provide for rate relief - a substantial move in a very short period of time.
And we promised we'd change the mandate of the Development Corporation. We promised Yukon people that the earnings of the Energy Corporation would be used either to make improvements to the electrical system or would be used for rate relief. We did that.
The other priority we saw in the energy section was the need to ensure that there was an adequate supply of affordable electricity for the mining industry and for Yukoners in general. We were working towards that, Mr. Speaker, and we were investigating it.
I'm not saying we went with the coal project, but we were positioning the Energy Corporation to be in a position to go out to the general public with one or two options and say, "This is what you've got. Do you want to dam another river? Do you want a coal project? Do you want a gas project? What do you want? Go out and have a debate on that issue." That's what we were positioning the Energy Corporation for. In fact, as I said to the minister the other day here, he has - I don't know if he's had a chance to review them or whether the Energy Corporation has brought him up to date on it - but we went out for expressions of interest in August of last year. I believe it was for 20 megawatts of power under the non-utility generator policy that we brought in, which would allow private corporations to produce energy and sell it to the utility.
My understanding is that there have been some pretty interesting proposals put forward to the Energy Corporation. What has happened to them? We've heard no more about it. Nothing whatsoever. But we did take those actions.
We also looked at the grid expansion north, hoping to pick up Carmacks Copper, if they went into production, and on to Pelly and on to Mayo. We go back to what the NDP did when they prebuilt in Dawson for the 1989 election. That didn't do anything to help us get lower-cost power.
We did a major review of the regulatory system, Mr. Speaker, and this is where I really want to be on the public record because I just find it mind-boggling now that, after this review took place, and we've had one GRA since the review -
Hon. Mr. Harding: Point of order, Mr. Speaker.
Point of order
Hon. Mr. Harding: I'd like to draw the attention of the Speaker to the lack of a quorum.
Quorum count
Speaker: A quorum count has been called for.
Bells
Speaker: We now recognize a quorum and debate can proceed.
Mr. Ostashek: Thank you, Mr. Speaker. I needed to get a little rest and get my wind so I could carry on here. So, I thank the member for that.
Some Hon. Member: (Inaudible)
Mr. Ostashek: Mr. Speaker, when we were so rudely interrupted there by the minister calling a point of order, I was speaking about - I don't know if it was in the budget speech; it was in one of the speeches that was given in this Legislature, in this session - where this government is looking again, at restructuring the Utilities Board.
Well, Mr. Speaker, that's a process that we just went through, prior to this last rate application, and it was a consensus agreement by all stakeholders. The Member for Kluane was involved in it and he may be one of the few that didn't agree with it, but I was part of those meetings. I was briefed on them all the time. We did, Mr. Speaker, exactly what the Member for Porter Creek South recommended to the Minister of Education this morning. We brought in an outside facilitator so that there could be no perceived bias on the part of government.
We brought in an outside facilitator who pulled all the groups together. We had several meetings. It was agreed to try the process and it worked. I'm not exactly sure what the total cost of the rate hearing was, but I believe it was a few hundred thousand dollars, compared to a million dollars for the rate hearing that was held in 1992, that ended up in the courts, which the ratepayers are still paying for today with the surcharge.
Mr. Speaker, the point I'm getting at here is that the Yukon - and I said that in the opening comments that I made in the speech for the Member for Riverside's motion in the last session - we set up a regulatory process that was totally out of sync with the number of ratepayers we have in the Yukon. It was $2 million for the 1992 rate application, two percent on the power bills in the Yukon; that's what it cost Yukoners. Now it's costing them more than that because we have a court decision on that that is going to give them some more money - saving 35 percent.
Mr. Speaker, I want to relate to you here today that we have put a process in place that is working. Maybe it did take a few people's soap-boxes from them, but it worked and we didn't have all of the interveners intervening on the same issues. They were divided up among the interveners. We didn't have a whole bunch of high-priced lawyers and consultants arguing for days and days and days. The system worked. Not only did it work, but the system we had in place before, as I said earlier in the debate, was far more costly than any provincial rate hearing that was ever held.
Mr. Speaker, the last rate hearing that was held in Alberta, where there are several million ratepayers, cost less than $500,000. Now, there is something wrong with a system that was costing $2 million for the few ratepayers we have in the Yukon. So, I would urge the members to seriously reconsider before they start tampering with a system that's working fairly well now.
But I will give them another alternative if they believe that it is costly. I don't believe it is. I think it's pretty cost efficient now, but they may want to consider getting rid of that regulatory process completely. Get rid of the YUB. It's not necessary and this would not be a first. In fact, Mr. Speaker, the Province of Prince Edward Island just did it a couple of years ago. They got rid of the public utility board and they set the rates on the floor of the Legislature. I would suggest to the minister, if he's looking for some real cost savings - we don't know, but we're pretty certain that the minister has been politically interfering in the operation of the utility - let's bring the utility back into Economic Development. Put it in there and use it as an Economic Development tool.
Put it in there, because that way the minister would be held accountable on the floor of the Legislature and we wouldn't have to worry about it. Set the rates on the floor of the Legislature - the transparency there for the Yukon public. This is what they're doing in PEI. A small utility like this cannot afford an expensive regulatory process. There are some real savings there that the government may want to consider.
Some Hon. Member: (Inaudible)
Mr. Ostashek: Why we should do it? Because we made a commitment not to do it. I'll tell you something I seriously considered, though. The previous minister, to me, made a commitment that we wouldn't do it during that mandate, but I will tell you, and I will tell the minister here, Mr. Speaker - and I have no qualms about doing it - that I did tell the Energy Corporation and people that were involved that if the new process that we put in place still turned out to be an expensive process, it is something that we would seriously consider, because there are substantial savings there, and there's transparency in setting those rates on the floor of this Legislature.
Some Hon. Member: (Inaudible)
Mr. Ostashek: The minister figures he may be condemned for raising taxes, but he's being condemned for politically interfering anyhow, so what's the difference? It's a very serious situation, and I'm just trying to offer some alternatives to the minister that he wants to look at.
So, the things that I see we need to do is we need to have - and these are things we were working toward; that's what the expressions of interest are, sitting there, for 20 megawatts of power. They're at the Energy Corporation now. I ask the minister to review them. He may find something in there that will help to reduce the cost of energy, as long as we're going to keep being dependent on diesel fuel. Everybody in this Legislature, whether they are on that side of the House or this side of the House wants to put Yukoners to work.
If we develop our own energy resources, we will put Yukoners to work. We will not be putting people to work in the Alberta oil fields and the Alberta refineries. We will be producing the energy in the Yukon.
On the environmental side of the equation, we don't solve an environmental problem of Aishihik by turning on more diesel engines. We don't do that.
Some Hon. Member: (Inaudible)
Mr. Ostashek: Well, we would have. I'm glad the member brought that up. Let's face the reality of it. The licence is good until the year 2002. There were hearings being held, there were environmental studies being done. We believed that we had that period of time before the new licence was to take effect where we could mitigate the damages at Aishihik Lake and find an alternative source of power and get it on stream by then. I don't think that you need a knee-jerk reaction of immediately pulling the plug - or putting the plug in at Aishihik - at great expense to Yukon ratepayers.
The damage has been going on, to a certain extent. Nobody knows for sure what the damage is because the jury is still out. Environmental studies are being done. What this minister and this government have done is circumvent those studies by unilaterally making a political decision not to draw down the lake.
Some Hon. Member: (Inaudible)
Mr. Ostashek: What do you mean, "tag"? The reality of it is, why do we have a Water Board that issues water licences if we're going to make political decisions? That's what I'm saying to the members opposite.
Some Hon. Member: (Inaudible)
Mr. Ostashek: We were working on it. You can't do these things overnight. What the minister did is cause a financial crisis at the Energy Corporation. One of the major contributors -
Some Hon. Member: (Inaudible)
Mr. Ostashek: Mr. Speaker, the minister said, "losing Anvil." The minister knew he had lost Anvil when he made the decision to pull the plug on Aishihik. Anvil announced before Christmas that they were closing down. The Aishihik decision wasn't made till January.
I think the minister needs to look a little further ahead than the next year or the next six months. We need to find some long-term solutions to this, and until such time as we get off diesel fuel, we're going to have a very serious situation in the Yukon.
Mr. Speaker, I have not heard anything from this administration on this, what they are calling a rationalization of assets and I'm calling a sell-out, that is going to lower energy costs to Yukoners. I thought that was what we were all trying to do. I know we're all concerned about it. We all have different ideas on how to get there, but I don't believe the ideas are to give away the assets at a book value, that we can buy back five years from now at an enhanced book value. We only need to look at what the private corporation did with their assets since 1987. They've enhanced them tremendously and they're getting a rate of return on that.
The minister says he has $2 million in savings with this. Well, I'm sorry, I can't agree with him, Mr. Speaker. He says he has $2 million in savings in the management agreement, but that is offset by the fact that he has given away $4 million in assets that he no longer gets a rate of return on for Yukon ratepayers, which is probably, in round figures, $500,000 a year. That's what he's given up. He says they're going to be reinvested. There is going to be a time lapse. The money will be put in the bank, drawing two- or three-percent interest, instead of the 11.5- or 11.75-percent return that the utility gets.
The second part of that is, not only have we given up that rate of return, but we have given it to a private corporation that will take the profits out of the Yukon.
That is everything that the NDP in the Yukon has stood strong and fast on for years and years and years, and I know there must be many of their supporters must be very disappointed with the position they have taken now, because it just doesn't make logical sense to me.
So, what are we going to have? We've got a $14-million shortfall - maybe more by the time we get talking to the president tonight, but while in the House last week, there could be a $14-million shortfall. We're going to use up the $8 million or $10 million that's sitting in the Development Corporation that was put there for further infrastructure development, which we could have got a regular return on. We're going to put that into the Energy Corporation. I'm not sure exactly how we're going to do that yet, because the Energy Corporation is a regulated utility. I don't think you can just give it a cash infusion without going to the Utilities Board. It has to be on their books somewhere, somehow. So, that's an issue to deal with yet.
What's going to happen with the $4 million? The way I see things happening right here is that that's going to be used up, too, to keep the rates from going up as dramatically as what they look like they're going to have to go up. So, at the end of a year from now, we're going to end up in a situation where we're still faced with high energy prices, we're still faced with a cash crunch in the corporation, and we have gotten rid of any extra cash that we had lying around to use for infrastructure development or a major energy infrastructure development. I don't follow the logic in that at all, Mr. Speaker.
So, in closing, Mr. Speaker, I just suggest to the minister that he seriously consider a long-range plan rather than a knee-jerk reaction that's going to take the political heat off them for a few months, because I can assure the minister, unless he comes up with a long-range plan, the political heat will not be off them for very long.
We were criticized severely by members opposite about the rates going up when the Faro mine shut down - the member is rubbing his hands over there, and I just want to tell him he has unlimited time. He can talk until 5:30, if he likes.
I lost my train of thought there.
Mr. Speaker, we can joke and kid around here, but this is a very serious issue that is facing Yukoners. There are no easy answers. I think the minister is finding that out; it was very easy to sit on this side of the House and criticize, but when you're in the political hot seat that the minister is in now and has been for the last few months because of increasing energy prices, it is not very nice. I know, I've been there.
I urge the minister and his government not to go with knee-jerk reactions. I urge them also, through the Energy Commission, to not embark upon a long, convoluted, drawn out consultation process when most of the consultation that has been done over the last 10 years is all documented at the Energy Corporation. It's on file. There is absolutely nothing changed except that the assets of the Energy Corporation have gone down and the assets of the private utility have gone up. So, we don't need a knee-jerk reaction.
I just want to say that we heard the minister responsible now, and his party, criticize us severely for the increase in power rates when the Faro mine shut down. We heard him criticize us severely because the rates didn't go down when the mine started up again. Now, the mine is going down and the new government is going to raise the rates again. It is in total contravention to what they said in Opposition.
They said that the corporation was getting windfall profits when the mine started up. Well, Mr. Speaker, if they were getting windfall profits, why do we have a financial crisis at the Energy Corporation today? Why do we have to have a huge rate increase - the third rate increase since this administration took power?
I hope that the minister has listened carefully to the debate today. We will review Hansard and we'll listen to what I had to say and we'll listen to what my colleagues have to say on this very, very important issue that is facing Yukoners today. Thank you, Mr. Speaker.
Hon. Mr. Harding: Thank you, Mr. Speaker.
Well, it's a pleasure to get an opportunity to respond to a somewhat enlarged jumble of contradictions from the Official Opposition than we get in Question Period. I guess the longer they have to talk, the more they contradict themselves.
But, Mr. Speaker, I heard the
member say today that we shouldn't do anything about proposed power rate increases, but just yesterday in Question Period we were being blamed consistently for two power rate increases that had nothing to do with decisions of this administration.
Then we had the Member for Klondike saying that we should do something about the newly proposed power interim rate hike that YEC has been talking about, and, today, the Leader of the Official Opposition stands up and says, "You shouldn't do anything about it; you should just let it happen." They want us to, as he put it "Hang on to everything in the YDC reserves."
So, what I can only infer from that is, one, that he is in favour of raising the rates or, two, he's looking to the taxpayers for a solution. There are no other choices.
Mr. Speaker, with regard to many of the issues raised, and there are so many, I'm going to start with a history lesson.
First of all Mr. Speaker, when we were in Opposition the Yukon Party government decided, with their famous bagman from Carcross, the former Member for Ross River-Southern Lakes, that they were going to privatize the Energy Corporation wholesale, sell it to private interests. They gave some backroom deals to Mr. Terry Boylan. They wouldn't tell anybody in the public what they were up to. It was clear that their agenda was to privatize the Energy Corporation wholesale.
Mr. Speaker, we consistently fought that position. We felt that it was important that the Yukon Energy Corporation maintain its asset base, maintain control of the Energy Corporation over its future and remain in public ownership. So, we fought them selling off the Energy Corporation wholesale to Alberta Power with no benefit for Yukoners. Mr. Speaker, we put up a very strong fight against that and eventually backed them off.
Mr. Speaker, when it came to the issue of our fights, through petitions and other methods in the Legislature for the ratepayers of the Yukon, the problem that we had was it was clear - and we heard it again today from the former Government Leader; he does not believe in rate relief. He calls it a knee-jerk reaction. He says its not sustainable and that is why he refused to agree to extending the rate relief program.
We put a lot of political pressure on him through petitions and other means to get him to concede, then he had some deathbed repentance during the election campaign, to a new electrical rate relief program. And the Liberals also agreed to that as well.
Mr. Speaker, one of the first things we did when we came into government was extend that rate relief program to make an effort toward rate stabilization. That was an appropriate response. That was what we felt what we could do, and that was what we felt we should do, and that is what we did.
When it comes to the issue of rate stabilization, Mr. Speaker, I don't think we committed to rate stabilization overnight in the face of a 1993 court decision on reimbursing the cost of a 5.5-percent temporary rate increase. We face a 30-percent rate increase as a result of world diesel prices increasing. That was something that was in the bailiwick of the Yukon Utilities Board. They approved the ability to establish those rate riders based on increasing world diesel prices before we ever even came into office.
Then, Mr. Speaker, the financial community and the Government of the Yukon were thrown the ultimate curve in November when we lost our major customer. What happened in 1993, when the Yukon lost its major customer? What did the Yukon Party do? What they did was take $3 million of taxpayers' money, flowed it through to Curragh Resources and paid off relatively six months' worth of bills for Curragh Resources out of the taxpayers' pockets so they wouldn't have to face the political heat of the Curragh property, which had to pay demand charges.
The Curragh property never came back on stream because the company went bankrupt, and eventually that money, or some of it, was recouped, but a lot of it was still lost to the taxpayer. So we didn't go down that route this time and take $3 million of taxpayers' money and throw it into paying off the demand charges, because we felt that all that did, in the absence of a firm production decision, was delay the inevitable.
But what else did the Yukon Party do, Mr. Speaker? They had a 58-percent proposed rate increase that they brought when the mine shut down in 1993. The rate increase that was proposed by the Yukon Energy Corporation is still high - it's 20 percent - but by their own standards, even with that big increase, we've gone beyond what they could produce after they were elected for a few months by 38 percent.
So, our record, when it comes to handling these types of tough issues, is equally as good, and much, much better, than the Yukon Party.
I don't profess to say that this is an easy equation when you lose your major customer, but now, some time ago - actually on March 24th - their power bills had been approaching the $3.6 million level, and they had not been paid. The company feels that there's some problem with the payment. They don't like the cost of service they're being charged and, among other things, they have a lot of problems with the energy system.
The bill, as of March 31st, as I understand it - the final reading was done a couple of days ago - is about $4.1 million. So there's a substantial accrued liability there to the Energy Corporation.
That is a significant amount of money, and the reason I believe it is is because the word "insolvency" has been brought up to the corporation. Insolvency usually pertains to when a corporation does not have enough current assets to meet its current obligations and therefore it becomes insolvent.
So, I figure it's a significant pressure reducer to have Anvil Range pay their bills and, concurrent to that and in terms of action, the Energy Corporation has filed the miners lien against the company. We've been in contact with them. They're resisting paying, obviously. They've said that they're going to pay their bills, but as of now, there is no formal payments schedule. They obviously want to talk more about energy issues and we'll have to work through them, but certainly that would take the pressure off the financial position of the government.
Mr. Speaker, after being faced with that eventuality of the Anvil Range announcing their shutdown and, although at the time they announced it was on a temporary partial basis, we, even though we had extended rate relief, knew that there was going to be some tough sledding ahead. We were faced with a request. The only directive we've ever given to the Energy Corporation was with regard to the Aishihik Lake decision.
Mr. Speaker, we committed to the Yukon public that we would work to mitigate the environmental impact on Aishihik Lake in the election campaign. We laid it out there for the public and we received requests from a technical advisory group that was established out of a former Utilities Board process that it was not wise, given the studies were not complete, to draw down the bottom two feet of water. That cost for that decision we knew was going to be extensive. It was based on the in-flows, it was based on the world price of diesel and it was also based on how long Anvil Range stayed in production over the winter, because nobody was sure how long they were going to continue to run the mill.
So, the first figures we had were upwards of $3 million. Anvil Range ran right through March 31, the time when the charge would be the absolute highest on the increased use of diesel, as well as the fact that there were 30-percent world diesel price increases. So, we didn't want that reflected on the ratepayers' bills. We wanted to ensure that that didn't happen, so we, at the time of the announcement, announced that it would go through the Yukon Development Corporation's reserves. That's how we funded it; not out of the ratepayers.
Now, Mr. Speaker, I think it's interesting when you listen to the members in the Official Opposition talk about their views on energy. We never quite know. You're always buying a pig in a poke, because they talked a lot about coal; they talked a lot about stabilizing rates; they talked a lot about increasing infrastructure; they talked about interlocking power grids between Alaska, B.C. and the Yukon. They talked about all this big-picture stuff: big dams, big bucks mentality. But what did we see from this government? Well, what did we see from the Yukon Party government? We saw a 58-percent rate increase when the mine went down. We saw rate relief programs. We saw no infrastructure growth whatsoever. We saw increasing use in diesel and really no answers.
The political courage was not there for them to make the tough choices. And, Mr. Speaker, we also saw that they promised in 1992 to do something about mitigating the environmental impact on Aishihik in their four-year plan, and in four years did nothing - squat.
So, Mr. Speaker, we're trying to deal with a very tough situation. The Yukon public does not want to pay higher rates and they've hung the fact that rates have gone up and are proposed to go up by a 20-percent increase, as I understand it, squarely around the neck of the government. That's fair ball. I don't blame them. I pay power bills, too, and I've seen them go up.
What we did was to extend rate relief, which the Yukon Party government had refused to do, to try and stabilize rates.
I would have really liked to have directed the Energy Corporation to write off the $1.1 million that they obtained from the courts to ease the burden this winter on ratepayers. I was lobbied very, very hard by the Utilities Consumers Group, by AYC, and by the City of Whitehorse to do that. I took a beating in the media because that was not done, but the reason I didn't do it was because I knew precisely what the picture of the Energy Corporation was. With the situation affecting Anvil Range and the increased costs due to the decision not to use the Aishihik water, I was worried that to write off another $1.1 million would only be more painful for the ratepayers later. I'm glad, in hindsight, that we did not make that decision in the face of a lot of lobbying to do it.
We were accused then and there, by not writing this off, of breaking a rate stabilization commitment. Well, I felt that the bill relief program, which was the context of the debate when the Yukon Party was refusing to do it, was how we promised to work towards stabilizing rates, and that was one of the very first acts we took. But the Yukon public, I guess, or some members of the Yukon public, had come to expect that rate relief would be part of it, so there wasn't a lot of obvious fanfare when we did make the decision to extend rate relief. But such is life, and such is politics, Mr. Speaker.
So, there have been a lot of tough choices and -
Some Hon. Member: (Inaudible)
Hon. Mr. Harding: Yes, the Clerk has started to cry.
Mr. Speaker, we are trying to lay out for the public the situation that we face. There are tough choices ahead and we are making tough choices, but I'd rather be here than on the other benches because I think we're making the right choices, but they are tough and I think it's important that the Yukon public has the equation. They'll say to us, "Well, deal with it," and we will deal with it and we give them that commitment wholeheartedly and we will make the best choices that we can.
We will work with the Energy Corporation