Whitehorse, Yukon

Wednesday, December 10, 1997 - 1:30 p.m.

Speaker: I will now call the House to order.

We will proceed at this time with prayers.

Prayers

DAILY ROUTINE

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

Are there any tributes?

TRIBUTES

International Human Rights Day

Hon. Ms. Moorcroft: I rise today to pay tribute to Yukon people who are joining together to recognize International Human Rights Day.

The Universal Declaration on Human Rights was adopted by the General Assembly of the United Nations on this day in 1948.

This year, the Yukon Human Rights Commission invited Yukon people to "shine your light on human rights" and sponsored a candle-lighting ceremony in the lobby of the Yukon government administration building over the lunch hour.

The ceremony was heartfelt and uplifting. I want to also acknowledge that Yukon College has held a ceremony today in recognition of the Universal Declaration on Human Rights.

Considering the motions that we're scheduled to debate today, it was moving to hear the chair of the Human Rights Commission emphasize the need to, above all, resolve conflicts without violence. People individually have a personal responsibility to examine their own behaviour and ensure that they are observing all human rights. In plain language, article 29 states, "We all have a responsibility to people around us, and we can only develop fully as individuals by taking care of each other. This includes the responsiblity to educate ourselves about situations where human rights have been restricted or denied.

I'm pleased to inform the House that the Yukon Film Society is sponsoring a film presentation on human rights at the Whitehorse Public Library on Sunday night. I encourage all Yukon people to do what they can to shine light on the issue of human rights here and all around the world.

Thank you.

Mr. Phillips: On behalf of the Yukon Party caucus and the office of the official opposition, I rise today to offer our support to the International Human Rights Day.

The purpose of the International Human Rights Day is to commemorate the adoption of the Universal Declaration of Human Rights by the General Assembly on December 10, 1940.

Since its establishment, the United Nations has played a key role in the protection and promotion of human rights around the world. Not only has it developed international human rights standards, the United Nations has also intervened in cases where human rights of individuals have been violated or abused.

The United Nations has also taken an active role in encouraging various countries to ratify international human rights laws to ensure that human rights are valued worldwide. The declaration was drafted by Canadian lawyer John Humphrey, and today marks its 50th anniversary.

In light of this significant anniversary, celebrations will be held throughout the year, and the Minister of Justice has mentioned the ones that will be held in the territory.

While we take time to celebrate the event, it is important that we also recognize the continuing need for human rights education and the protection of basic human rights throughout the world.

As Canadians, we are truly fortunate to live in what has been recognized as the best place in the world to live, where we are able to enjoy many democratic rights and freedoms. With regret, there are other countries that are not as fortunate - those countries that are filled with atrocities of turmoil and strife on a day-to-day basis and where freedom of speech is not granted and personal rights are abused.

I believe it's important that we not take for granted the free environment we now possess, and I also believe it's incumbent upon each and every one of us to join together to ensure that all forms of discrimination do not have a place in the Yukon and to serve an example for other regions of Canada and the world.

Mr. Cable: I rise on behalf of the Liberal caucus to recognize the International Human Rights Day. We Canadians need to recognize that the large majority of the world's population lives under the dictator's boot or lives in countries where the candles of democracy and human rights barely flicker.

We need to recognize also that in our own country, many of our own rights do not have a long tradition. The oppression of the family compact in Upper Canada is only 150 years old. The Riel Rebellion is only 100 years old. Female and aboriginal voting rights are products of this century. Here in the Yukon, our human rights legislation and our ombudsman, both part of the checks and balances on discrimination and on the system's abuse, are recent innovations.

We need, Mr. Speaker, to always recognize that the first step to losing our rights and our freedoms is to take them for granted.

Speaker: Introduction of visitors.

Are there any returns or documents for tabling?

Are there any reports of committees?

Are there any petitions?

Are there any bills to be produced?

Are there any notices of motion?

Are there any statements by ministers?

Speaker's ruling

Speaker: Before proceeding to Question Period, the Chair will provide a ruling on the question of privilege raised on December 9, 1997, by the Member for Porter Creek South.

The member met the notice requirement found in Standing Order 7(1)(b) by submitting a written notice to the Office of the Speaker at 10:00 a.m. on December 9.

Standing Order 7(4) states that the Speaker must rule on (a) whether there appears, on the face of it, to be a case of breach of privilege, and (b) whether the matter has been raised at the earliest opportunity.

With regard to whether the matter was raised at the earliest opportunity, the government House leader stated that he felt that the matter should have been raised the previous day. He referred to the ruling made on April 24, 1997, on the question of privilege raised by the Member for Kluane. That ruling has been reviewed and does not apply to this situation. The Chair found that the Member for Kluane was raising a point of order and not a question of privilege. Points of order must be raised at the time that the event occurs.

There are many precedents of this House where members have raised questions of privilege on the next sitting day after the event being questioned has taken place. This allows members time to review Hansard to give careful consideration to the matter before deciding whether they will raise it in the House. Also, the House indicated its intent that a matter could be raised on a following sitting day when it adopted Standing Order 7(1)(b) and its requirement for written notice.

The question for the Chair to decide on, then, is whether the Member for Porter Creek South has raised a question which, on the face of it, is a possible breach of privilege. The Chair finds that there is not a breach of privilege. The refusal of the government to produce a document requested by a member is neither a point of order nor the basis of a question of privilege.

The question of whether a document should be produced is a matter of deliberation for the House. It can be discussed at a number of times, including Question Period, debate on the estimates of the department and on a motion for the production of papers. It, however, is not a matter for the Speaker to rule on.

There is one further point the Chair would comment on. The Member for Porter Creek South said that a media person seemed to be receiving favoured treatment over members of the House in terms of access to a publicly available document. It is not the place of the Chair to investigate such allegations but the Chair is sure that ministers would not want restrictions to apply to members of this House that do not apply to anyone else.

This then brings us to the Question Period.

QUESTION PERIOD

Question re: Workers' Compensation Board, administration costs

Mr. Jenkins: Mr. Speaker, my question today is for the minister responsible for the Yukon Workers' Compensation, Health and Safety Board.

Mr. Speaker, the Workers' Compensation Board has serious problems. It is suffering from a major hemorrhage in its cost of administration. Based on the size of the insured workers, the Yukon's board has the highest administration costs of any compensation board in Canada. In 1990, these administration costs totalled some $1.5 million. Six years later, these costs have escalated to $4.6 million, and that does not include the administration costs for vocational aid disability management services.

So, effectively the board's total administration costs are some $5 million a year.

What does the minister plan to do about these escalating costs?

Hon. Mr. Harding: Well, first of all, I would say to the member opposite that, as the critic, he should be aware that there is a board responsible for deliberating on such matters, which is made up of a chair that's appointed through consultation with both employers and employees. There are two employer representatives, who have been nominated by business organizations, and two labour representatives, nominated by labour organizations. Both business and injured workers have identified administrative costs as a concern.

The increases that the member talks about did not occur solely in the last year that I've been the minister responsible; as a matter of fact, there were deficits run by the board in 1994, 1995 and 1996. I am concerned about it. I've passed those concerns on to the chair. The chair is conducting a review and doing some comparisons. They don't want to see people comparing apples and oranges. They want to make sure that we're looking at appropriate statistical comparisons when it comes to administrative costs.

I, myself, would like to see this done thoroughly and to see reductions in those costs where possible.

Mr. Jenkins: Mr. Speaker, when a patient is hemorrhaging, the first job of the attending physician is to try and stop the bleeding. The minister has to accept his responsibility and become part of the solution, rather than just hide behind the board and become part of the problem.

In 1999, the Workers' Compensation assessments are expect to increase between 30 percent and 60 percent. Businesses in Yukon simply cannot afford such an exorbitant increase. I would like the minister to explain what he is going to do about this approaching emergency.

Hon. Mr. Harding: Well, Mr. Speaker, the member is talking in as colourful and as alarming language as he possibly can as he reads out the question that was written up for him this morning, but I have to take issue with the member saying that I'm hiding behind a board. Mr. Speaker, the legislation is clear that there are employer and employee representatives on the board that are charged with certain responsibilities to oversee the fund and to protect and to pay out claims to injured workers.

Mr. Speaker, the member referred to hiding behind a board. In actual fact, what I'm doing is involving citizens of this territory in the decision-making process, and I don't think there is anything wrong with that.

With regard to him alleging that pieces must be picked up, I would say that I have been trying to pick up the pieces of the problems of the Compensation Board. Under the Yukon Party, we saw incredible turmoil in the board. I had to immediately try to seek a neutral chair. I had to hire a workers' advocate. I had to try and get an occupational health and safety review back up. I had to try and increase the accountability of the board to the stakeholders. All those steps are being undertaken along with the review of administrative costs.

So, we have an agenda. We're implementing it, and it's working.

Mr. Jenkins: The change came about after the act was altered under the previous NDP government, Mr. Speaker, and costs escalated accordingly after the new act was assented to. Now the minister has been given a period of grace on the rate increase because the Workers' Compensation Board has received a $1.7 million in additional revenue from an insurance company.

So, will the minister here today agree to establish an operational audit of the Compensation Board?

The minister has that authority under section 99 of the Workers' Compensation Act, where it says: "The minister may, by written order, require the board to investigate any matter under its jurisdiction in the manner requested by the minister." So, the minister has that authority. Will he undertake a management audit of the Workers' Compensation Board?

Hon. Mr. Harding: The compensation system in this territory has the lowest average rates in the country. We have one of, if not the only, fully funded board in the country. I don't see the crisis the member talks about. We're trying to deal with a situation left to us by the Yukon Party, which was a shambles - ministers interfering in the adjudication of individual cases, no credibility by either stakeholders or the board. We're trying to turn all that around. I think we've made some good strides in that respect.

Mr. Speaker, I only wish the member, who's the critic, would have stuck around for more than half an hour last night before he headed out the back exit door at the annual information session, because there were some good discussions with the stakeholders about the issues that he's raising here today.

Question re: Workers' Compensation Board, administration costs

Mr. Jenkins: Once again, my question is to the minister responsible for the Workers' Compensation Board. Mr. Speaker, the minister must act now. Injured workers and businesses can't afford any further delays. The Compensation Board has been running a deficit for the last three years. In 1996, the deficit was $4.1 million. This situation cannot be allowed to continue any longer. The asset base of the Compensation Board is being seriously eroded every day, and the minister refuses to act. So I am asking the minister, as a first step, to call for an operational audit, and then take whatever legislative action is required to turn this alarming situation around.

Will the minister give that undertaking, Mr. Speaker?

Hon. Mr. Harding: The member charges that the minister refuses to act. I charge that the member refuses to listen, because his questions were obviously written out for him this morning. If he would listen to the responses that I'm giving him, first of all, we've put in place a neutral chair for the board. We've gotten advisory groups up and running. I met with the stakeholders just last week - all the stakeholders; I believe there were 14 of them there from business and labour - to talk about where the board's going.

These advisory groups are going to be making recommendations on administrative costs, on policy changes. We have a workers' advocate now in place - something that could not be brought to life by the previous administration - which has given fair access to the system by injured workers. We are trying in many different avenues, including occupational health and safety regulation areas, to try and be more preventive in our approach to occupational injuries.

So, Mr. Speaker, we have a thorough agenda underway. The stakeholders that I met with last week seemed to be fairly accepting of that, and they want to see progress. I think that they're willing to work with us to those ends.

Mr. Speaker, I don't think the member opposite should be insulting the good work of the people on that board that are representing employers, as he's doing here in this House today.

Mr. Jenkins: Well, Mr. Speaker, virtually everyone but the minister realizes that there is a crisis emerging in the Compensation Board. At last night's meeting there were 30 people in attendance, of which 14 we were board members or employees of the Workers' Compensation Board. Another five were in attendance, three of us from this Legislature and two assistants. Another individual was there transcribing the proceedings. So, that's what took place at the meeting last night.

Yes, there was good discussion. Yes, I stayed for part of it, and yes, I left early. The minister did come in late. He doesn't mention that.

Mr. Speaker, injured workers are not benefited by having their compensation awards eaten up by high administration costs. If the end results of all these additional areas of study are that administration costs will be driven down, so be it. But, what the Workers' Compensation Board is set up to do is to compensate injured workers and rehabilitate them. They are not happy, businesses are not receiving value for their money and the injured employees are not benefiting. There is major cause for concern.

I would like to ask the minister to explain why he isn't concerned and why he doesn't want to uncover the reasons for these high administration costs.

Hon. Mr. Harding: Well, I can assure the member that I was there for the portion of the meeting that I was supposed to be there for - that I was asked to be there for. The member opposite stuck around long enough - just long enough - to count the people in the room and then he was out the back door.

But, Mr. Speaker, he should have listened to the discussion, because he's not listening to me, he's not listening to the board, he's not listening to the stakeholders. He doesn't have any foundation for what he is saying here in this Legislature today.

I have met with all these people. I have talked to them. We have identified the concerns, one of them being administration, and we are actively working on them. And the board itself and the chair of the board and the employer reps on the board, who have the ability to set assessment rates, are also working on them - as well as the labour representatives.

So, we think we have made progress and we will continue to work with our advisory groups on the stakeholder base to make more progress in terms of improving the system.

Mr. Jenkins: Well, we have another example of the NDP calculator at work, Mr. Speaker, but unfortunately for the minister the buck stops at his desk. The total assessments do not cover the injured workers' costs and the administration. There is a shortfall. There is a significant shortfall and it's growing each year.

The Compensation Board operates under a legislative framework, and that minister, Mr. Speaker, is responsible for that framework. And when something goes wrong with the board, it is ultimately the minister who must endeavour to fix the problem.

Can I at least get the commitment from the minister that he will re-examine the act and the powers of the board in order to see what can be done to reduce the board's exorbitant administration costs? Will the minister give that undertaking, Mr. Speaker?

Hon. Mr. Harding: Mr. Speaker, the member really must drop his written-out questions for him on the supplementaries. I've answered this question, now, I think, three or four times.

With regard to the board and the situation, we have the lowest average assessment rate in the country. We have one of, if not the only, fully funded boards in the country.

Mr. Speaker, I'm surprised that the member opposite is advocating the raising of assessment rates to deal with any of the three deficits that were run under the Yukon Party administration of the board.

Mr. Speaker, I know the board is working very hard to deal with those shortfalls. I've been working very hard, since I came into this portfolio, to deal with the shambles and the mess that was left by the previous administration at the Workers' Compensation Board.

We have made progress. I had a meeting last week with the stakeholders of the board to talk about an act review, and we were looking at the fall of 1999 for that.

On the administration side and the costs there, that's been an identified concern by the stakeholders. I'm working with them on the formation of advisory groups so they can participate in an analysis of the administration costs and also some analyses of the policies.

We've hired a workers' advocate. We have a neutral chair. We have some continuity on the board. And, Mr. Speaker, I think we're making progress and we're going to continue to work toward making more.

Question re: Workers' Compensation Board, addressing deficits

Mr. Cable: Thanks, Mr. Speaker. I have some questions for the same minister on the same topic, the Workers' Compensation Health and Safety Board. Now one of the things I got out of the meeting last night is that the present low premium levels and expenses of the board are being maintained in part by eating into the capital of the board's investments. That alarm bell had been rung by the previous board chairman last November. There was an article in one of the newspapers that said that in the previous two years - that's previous to last November - the board ran $2-million to $3-million deficits and the minister today has just confirmed that.

Just to see if we have any common ground, does the minister share the view that if the board is to maintain its investments intact and deplete its funds, it is going to have to raise premiums, reduce operating expenses or do some combination of those two things?

Hon. Mr. Harding: Well, Mr. Speaker, one of the problems - or at the time it wasn't a problem, but one of the things - that happened when the new act came about was that there were some major changes in the assessments rates; for example, some of the rates that used to be in the $7.00 range for some of the more high-risk industries were reduced to around $3.00 and there hasn't been an increase in those rates since 1989.

So, with regard to the member's question, I would just say that I think the board has got some challenges to deal with and he is probably correct in his analysis of the situation - that it is going to take some combination of factors, including a good analysis of administrative costs, to ensure that they can continue to have a good stable fund there and keep it fully funded for the benefit of injured workers in this territory.

Mr. Cable: Well, I thank the minister for that response. Does the minister also share the view that the administration costs of the board, as a percent of assessments or revenues or on the basis of dollar per claim process, are higher than the national average and, in fact, significantly higher than in some of the smaller jurisdictions?

Hon. Mr. Harding: I have raised the issue of administrative costs with the new chair of the board, who I know the member opposite supported. Actually, he asked me. Together, we worked on the issue to get the person appointed to the position. I've had extensive conversations with the chair of the board about this issue. He feels that there is a problem, but that perhaps it is not as great as the member from the Yukon Party, who just questioned me, would have people believe. He is doing a full analysis of the issue. He's hoping to make some changes. He's hoping to involve both the employer and the labour representatives on the board in those changes.

He cautioned me, however, that he would provide me with a good, statistical comparison and that a lot of the comparisons with other jurisdictions do not apply. Sometimes you can get yourself into a situation where you're comparing apples and oranges.

I hope to have more thorough information for the members in the next sitting about changes that are being undertaken in the area.

Mr. Cable: Now, the board's off to a good start, I think, on working up a strategic plan and is setting up committees to provide input, but there are a number of questions relating to expense levels and to the report done by the board's fund manager into projected premium levels that this House could profitably question the board on.

Now, the board has appeared before this House before in the past, during the Yukon Party administration, to provide members with information and to be questioned on current issues. Is the minister prepared to ask the president and chairman to appear before the House in the spring to discuss these various issues?

Hon. Mr. Harding: It is something that I would certainly consider. The member is quite right, the board did appear under the administration of the Yukon Party. At that time, the board was in a state of shambles. There was a lot of upheaval at the board. It is interesting to note, however, that these are the first questions today on the Workers' Compensation Board that I've had in the entire session of the legislative sitting. I think that says something about the good work of the board in terms of trying to deal with a situation that was once quite chaotic.

There's still a lot of work to do, Mr. Speaker, and we're going to continue to roll up our sleeves and work with the stakeholders - injured workers and employers - to try and get that work done. So, I will give that request serious consideration for the spring.

Question re: Development assessment process

Ms. Duncan: My question is for the Government Leader. I wouldn't want him to go to the first ministers conference without feeling that he had questions from the Liberal caucus.

The federal government, the CYFN and the Yukon government set December 19 as a date for substantive policy matters to be finalized regarding the DAP and forthcoming DAP legislation. Would the Government Leader advise if that deadline will be met and when the draft legislation will be ready?

Mr. Livingston: The work has been ongoing with the other two parties - the Government of Canada and the Council of Yukon First Nations. During the past three or four weeks, we have had to re-jig our time lines in order for us to complete work on outstanding issues.

Ms. Duncan: Well, Mr. Speaker, let's try the question again. I'd like to ask the Government Leader - the DAP commissioner has indicated that they've had to re-jig their deadlines - this question: will the substantive policy issues be resolved and draft legislation be ready early in the new year?

Mr. Livingston: The work, as I said, is ongoing. The re-jigged time lines are set as a goal to have the work on outstanding issues completed by December 19. What this will do is to provide some time over the following six or eight weeks to finalize the draft legislation.

One of the very important stages, in our government's view, is to provide an opportunity for public consultation in the Yukon on DAP legislation, and that will be provided in the first part of the new year, and that would be a three-party process where we'd have the Council of Yukon First Nations, the Government of Canada and the Yukon government bringing forward the draft federal legislation for comment from various interested parties in the Yukon.

Ms. Duncan: Mr. Speaker, would the DAP commissioner be precise on some dates? When will that consultation on draft legislation take place?

Mr. Livingston: I thank the member for the question. Certainly I can be precise. We anticipate that the consultation will take place either beginning in late February or early March, and running through for at least 60 days.

Some Hon. Member: (Inaudible)

Mr. Livingston: Pardon me? The member asked me if that's as precise as I can get. We have three parties working on the time lines, and we've been faced with some considerable challenges ensuring that the three parties do sit. We've pressed very hard for additional meetings. Finally we were able to get some additional meetings this fall, in order for us to try to resolve outstanding issues. We feel this is important legislation for the Yukon - for developers and for interveners - so we anticipate that the consultation will take place, as I said, in the first part of the new year, March and April, in all likelihood, and that the federal legislation should be ready for the House later on in 1998. I would anticipate that we would see the DAP come into force in January of 1999. That kind of a time line is what we're looking at.

Question re: Map produced by Department of Tourism, mistakes in

Mr. Phillips: My question is for the Minister of Tourism. Yesterday in the House, Mr. Speaker, I asked the Minister of Tourism about the real map, a map that was produced by the minister's department, which appears to be incorrect in many areas. The minister was going to bring back information for me. I understand today, Mr. Speaker, that there were 18,000 copies of this map printed, at $1.20 a piece, for a cost to the Yukon taxpayer of $21,600. The map is going to have to be reprinted.

Can the minister tell us what the process was for proofing the map? I'm sure that the Department of Tourism must have had an opportunity to proof this map before it went to its final publication.

Hon. Mr. Keenan: Yes, the Department of Tourism has managed to get back to me on this matter. The map, which is to be released for next summer's tourism operation, was proofed by the Native Language Centre and the aboriginal language units of the Yukon.

Mr. Phillips: Mr. Speaker, can the minister tell us whether anybody in the Department of Tourism is concerned from time to time about any maps that are produced in the territory, about whether or not the map is correct, and did they have an opportunity to look at the map before it went to print and, if not, why not?

Hon. Mr. Keenan: Yes, Mr. Speaker, it had been, I believe, looked at by the marketing department of the Department of Tourism. Mistakes were identified and, certainly, it has now been sent back and is being renegotiated.

Mr. Phillips: Well, the minister's not very clear, Mr. Speaker. He didn't answer my first question either, when I asked him what the cost would be to the taxpayer. So I'd like the minister to get back on that.

But it's not clear from the minister in the answer to the last question, Mr. Speaker, whether or not they looked at the map prior to it going to printing or whether they looked at the map after they received copies of it. The normal process, in the past anyway, is that officials tended to look at these kinds of things before they printed 18,000 of them.

Hon. Mr. Keenan: Mr. Speaker, I do believe that the department is following the established process, and I understand that the dollar figure for a plate change, which is what it will have to be, will be approximately $800, which will be certainly incorporated into the department's budget.

But also let me say, Mr. Speaker, that deadline pressures and exercise of artistic license are not excuses of this government and of this administration. As a matter of fact, as I can quote from the Whitehorse Star on Monday, August 12, 1996, of the previous administration being in at that time in government, "A gentleman came in from California last week, was on a fishing trip and he picked up this fishing synopsis. He looked at the cover and said, 'What the hell is going on here? What the hell is the Yosemite National Park doing on a Yukon fishing guide?'"

Although, certainly, Mr. Speaker, this government is working to endeavour to correct these mistakes and certainly ...

Speaker: Would the minister please conclude his answer?

Hon. Mr. Keenan: ... this government has, Mr. Speaker, identified these mistakes before they were brought out into the public so as not to embarrass the Yukon at large as the previous administration has.

Speaker: Would the minister please conclude his answer?

Question re: Land, excessive lot inventory

Mrs. Edelman: I'm not too sure about this, but my question is for the Minister of Community and Transportation Services. It concerns the holding costs that YTG is paying on its inventory of residential lots. We've spoken about this before - actually, just recently.

Now, the recent Auditor General's report for the fiscal year ending March 31, 1996, pointed out that the Yukon government has approximately $25 million tied up in land inventory. The Auditor General suggested that the Yukon government simply has too many lots. As a result of this, the Yukon government is losing over $1 million a year because of excessive holding costs and these excessive costs reduce the revenue that the government could obtain if, instead, the money was invested elsewhere.

What steps have been taken since March to reduce what the Auditor General has described as excessive holding costs?

Hon. Mr. McDonald: Well, I really wanted to answer her question before I left, so if the member doesn't mind, I'll pick up this question, because it does relate to the Ministry of Finance and government financial policy.

The member is quite right that the land inventory right now is excessively high. Historically, it's been in the neighbourhood of $13 million to $15 million in land held for sale. Now, it is running in the $25-million to $30-million range. A large portion of this land is the result of a very aggressive residential lot construction program in the City of Whitehorse in the Copper Ridge area.

While I personally agree with the Auditor General that there is a problem, I must say, to be consistent with the answer that I gave to the other member the other day, who was asking questions about the Auditor General's report, that that was a matter of a political decision made by the politicians to build a lot of lots in the City of Whitehorse and run the inventory to the levels that it is at today. It was the subject of a lot of debate in this House.

So, while I agree with the Auditor General, I do not believe that the Auditor General's place is to interfere in our political discussions.

Mrs. Edelman: Well, regardless of whether or not it was a political decision, the main problem, according to the Auditor General, is that the government has too much inventory - approximately a three and a half year supply, and that was in 1996. Now in comments to the Auditor General, the Yukon government responded that the inventory was closer to two years. Can the minister - and this might actually apply more to the Minister of Community and Transportation Services - tell the House what the current inventory is and is it up or down since the Auditor General made his observations?

Hon. Mr. McDonald: Mr. Speaker, the inventory is slightly up because the decision was made to continue to undertake the land development that was planned last year into this summer, but it is still in the $25-million to $30-million range.

This issue about the amount of lots is a significant issue. The political argument that took place around this issue was that there was a concern that not only were there too many lots being constructed and not only was there too much cash held in land for sale causing lost interest income, but there was also another concern that it was artificially propping up the local economy, particularly with respect to the road and lot construction industry.

At one point or other, when there is a glut of lots on the market and the government retrenches, they will fail to provide what people expect, which is a continuing level of activity in this particular area. That was the nature of the political discussion that took place.

So once again, I agree with the member and it is something that we will have to take into account when we consider the amounts of cash we tie up in any particular area, particularly land development, when we're constructing next year's budget and try to, on the one hand, reduce the existing land inventory and number two, the land that we do develop ought to be lands that we have some reasonable assurance there is a market for.

But once again, I will say it for the record because the member raised the issue in the context of the Auditor General's report, that I agree with the Auditor General, but I do think that that comment is misplaced, given the political discussion that took place in this Legislature.

Mrs. Edelman: Well, Mr. Speaker, certainly land development from this perspective is a little bit different than it is from the municipal perspective. From the municipal perspective, it is very important that land be released into the market, that people build on it and that taxes are raised for the municipalities. That is always important on a municipal level, and it's important to remember that municipal block funding has not gone up in almost 11 years and that we need to keep that money in the economy.

Now, the Yukon government said in their response to the Auditor General that their goal was to strive to reduce the amounts of funds tied up in the inventory, as the minister has said. Has any progress been made by your government toward achieving this goal? The Minister of Community and Transportation Services said on a previous occasion that the minister is not interested in selling any lots at anything less than development cost, because they would lose money. Yet, at the same time they are already losing around a $1 million a year by holding on to too many lots. It looks like a losing situation. Now, what options are the government pursuing to fix the problem?

Hon. Mr. McDonald: Well, there are a number of factors to take in to account. Obviously, the amount of money that we invested in the lots is money that the Yukon taxpayer deserves to have recovered.

Secondly, the simple solution to unload lots below cost on the marketplace will have a significant effect on the market for lots, generally, and, we have to be very, very careful to not disturb the existing marketplace.

So, anything that we do do, is going to have to require, at a minimum, plenty of consultation. I point out to the member that, while the municipal block funding has not increased significantly in the last little while, the equivalent of block funding for the Yukon government, the formula financing transfer, has decreased in the last little while and that does create some urgency in the situation for us.

Clearly, as I said before, we have to first of all determine whether or not we should build more lots. How can we reasonably dispose of some of the lots we already have in inventory? The bulk of the land inventories is really found up the hill at Copper Ridge and Granger. That is where it is now. And, that's where the problem has come forward.

But, I'm certain that, when we get to Committee estimates, we will have a good opportunity to explore this discussion more thoroughly in a manner that allows for some dialog.

Speaker: The time for Question Period has now elapsed, and we will proceed with Orders of the Day.

ORDERS OF THE DAY

OPPOSITION PRIVATE MEMBERS' BUSINESS

MOTIONS OTHER THAN GOVERNMENT MOTIONS

Motion No. 70

Clerk: Motion No. 70, standing in the name of Mr. Jenkins.

Speaker: It is moved by the Member for Klondike

THAT it is the opinion of this House that the proposed user fee charges for air navigation services in Canada will add to the cost of air service, specifically air cargo, in the north, and have a significant impact on tourism, exploration and the cost of basic goods; and

THAT this House urges NAV Canada to reconsider its proposal to replace the air transportation tax with user fees so that northern Canadians do not bear any additional costs than what is currently being charged for air navigation services.

Mr. Jenkins: Mr. Speaker, by way of a little background on NAV Canada, NAV Canada is a private sector, non-share capital corporation, which now owns and operates Canada's civil air navigation services. It used to be referred to under Transport Canada as ANS.

Canada's air navigation system coordinates the safe and efficient movement of aircraft in Canadian domestic air space and international air space assigned to Canadian control. It provides air traffic control, flight information services, weather briefings, airport advisory service, air navigation and approach aids.

The responsibility for this country's ANS network and facilities were transferred from the federal government to NAV Canada on November 1, 1996, for $1. 5 billion.

They're Canadian dollars, Mr. Speaker, which is reassuring.

Some people say that this was a giveaway. Yet when one analyzes what is transpiring at the present date, the burden of responsibility for the costs incurred to operate it are now being borne by the users.

The air navigation facilities include seven area control centres and over 100 airport control towers and flight service stations. These facilities are supported by a network of 1,400 enroute and terminal aids to navigation and landing aids. NAV Canada has a mandate and responsibility to deliver a cost-effective, safe and efficient service to its clients and to its users. The company has been specifically structured to meet consumer needs and to encourage significant cooperation and dialogue with the aviation community.

NAV Canada is governed by a 15-member board of directors, and members are nominated by stakeholders representing aviation users, bargaining agents and the federal government. There are four independent directors, and then there's NAV Canada's president and CEO.

NAV Canada also has an advisory committee elected by associate members, empowered to analyze and make recommendations to the board of directors on any matter affecting ANS.

The safety of Canada's civil air navigation service is NAV Canada's highest priority. As a non-share capital corporation, run by a diverse and representative board of directors, the company does not focus on profit making, but, rather, can concentrate on running a safe, efficient, technologically up-to-date air navigation service.

Surplus revenues must be reinvested into the system. It is a not-for-profit corporation.

NAV Canada is one of the first private sector companies in the world to use a non-share capital, not-for-profit structure to commercialize a government service, which in itself is very interesting, Mr. Speaker.

Under the Civil Air Navigation Services Commercialization Act, the company is enabled to charge for air navigation services. Following the announcement of its original fee proposal in May 1997, NAV Canada undertook consultation with users of Canada's air navigation services and other stakeholders. As a result of these user consultations, NAV Canada subsequently has deferred its plan to implement both the new user fees and the increases to existing fees to March 1998.

Under the original proposal, the fees were to be introduced on November 1, 1997. This fall, NAV Canada received confirmation from the Minister of Transport that its proposed user fees met the legislative charging principles in accordance with the Civil Air Navigation Services Commercialization Act. Consultation will take place over the next year to develop a user fee proposal that will provide for full cost recovery, scheduled for implementation on November 1, 1998.

So, Mr. Speaker, this is our window of opportunity to get involved in the consultation process. When these charges are fully implemented, the user charges will allow NAV Canada to operate independently of government funding, thereby completing the commercialization process.

When one looks at the resulting effect on this change in the way ANS is operated in Canada, Mr. Speaker, one sees tremendous additional costs burdening air users north of 60. Up to this point in time, there was a tax placed on the ticket of every commercially used airline passenger. These ticket taxes were used to fund the air navigation system. That will be slowly eliminated, and a new series of charges will be implemented.

The implementation side of it will take these fees and will allow NAV Canada to charge for aircraft movement, every NAV aid used, and for every mile travelled in Canadian airspace.

Under this proposal, new fees would be introduced for both domestic and international flights that land and take off in Canada. Increased charges will also apply to existing flights that use Canadian airspace but do not land or take off in Canada.

An example of this would be over the Pacific Ocean, west of British Columbia. When flights travel from, say, Anchorage to Seattle, they would be handed off from Anchorage centre to Vancouver centre and the resulting charges would be assessed to that airline or that air carrier.

What we're looking at in the north is an implementation of those same charges, Mr. Speaker, on all flights originating here. And if we want to use the example of our main carrier, based in Whitehorse, that flies Whitehorse-Dawson-Old Crow-Fairbanks-Dawson and return to Whitehorse, initially there will be a small change and a small increase in what they will be charged. Under the proposed user fees, based on the weight of the aircraft, they will be paying considerably more upon full implementation, because it doesn't matter if the aircraft is loaded with passengers or empty of passengers, whether it's loaded with freight or empty of freight. The air carrier will be assessed the same charge for landing and taking off in Whitehorse and for every air mile travelled in Yukon and every NAV aid used in Yukon.

These costs will eventually be placed on the backs of those using the service, and those using the service, Mr. Speaker, are you and I. It will have to be reflected in the ticket price and the cost of every pound of freight - I guess we should say, kilogram of freight - moved by these carriers.

In the fall of this year, Mr. Speaker, I wrote to the minister, Mr. Collenette, asking the Minister of Transport to ascertain what protection, if any, that Transport Canada included in the agreement for sale of air navigation services to NAV Canada for the north. I went on to say that it's my understanding that effective November 1, NAV Canada will be implementing user-fee charges based on the weight of the aircraft, the flight distance, frequency of takeoff and landings, and that these user fees replace the air transport tax previously charged on each ticket by the federal government. These new charges will cost northern airlines around $14 million annually.

I went on to say many northern communities are totally dependent upon air transport for both freight and passenger services and that increasing the cost of air service and air freight will have a significant impact on northern economies in terms of not just our basic cost of living, but in terms of tourism, mining, oil exploration and the cost of basic goods and infrastructure.

I went on and said that as Yukoners and other northern Canadians we already pay a premium for air transportation. When one looks at the cost of regularly scheduled airlines, east and west in Canada, and compares it to north and south, we are paying virtually double - virtually double for providing that same aircraft seat. It is in part due to competition or the lack of competition.

Simply put, Mr. Speaker, the proposed user-fee charges will add to the cost of air service, especially for those of us who have no other choice. Under section 24(1) of the Civil Air Navigation Services Commercialization Act, the minister is empowered and may give direction to the corporation regarding air navigation services at or in respect of northern or remote locations. In view of the importance of reasonably priced air service to the north, I urge the minister to use his discretion under that section of the act and work out modifications to the proposed NAV Canada user-fee charges.

I went on to say that this would ensure that northern Canadians do not bear any additional cost, other than what is currently being charged.

The initial concept on privatization of NAV Canada was that costs were to be a wash. It was going to cost the same to operate the system under the previous method as it was under NAV Canada, and they would be funded in this manner.

By including this section in the commercialization act, the federal government must have recognized that there was going to be an impact on the northern air transport system. And in the fall, again, NAV Canada announced a revision and a review and a staged implementation of the proposed user fees and agreements on deferrals.

When one looks at what has transpired since the acquisition by NAV Canada, in the initial four-month period since they started, revenues were some $302 million and operating expenses totalled $235 million, which, after interest and depreciation, produced an operating surplus of some $26 million.

As a not-for-profit corporation, NAV Canada will use any surplus to maintain reserves, fund capital expenditures, reduce its debt levels, lower user fees or reinvest in its basic business.

The critical issue for NAV Canada is the financial issue. The company has recommended that the preliminary fee structures not affect aircraft weighing 5.7 ton - 12,500 pounds or less - which precludes most of the general aviation here in Yukon, but does include our main carrier based in Whitehorse.

These aircraft would have their user fees deferred for a one-year period, starting November 1, 1997, and the consultation program has begun. The industry will end at the end of 1997. By November 1998, NAV Canada is supposed to be no longer dependent on government funding. The existing air transport tax on each ticket, paid for by you and I when we travel, will no longer exist.

This area is the area in which we have to lobby our senior government for changes and to look at that section of the act that allows the minister some flexibility in providing the service north of 60.

Mr. Collenette did respond to my letter to him and his office and, like most elected officials responding, hid behind a multitude of issues and left me wondering, somewhat similar to spending time in this Legislature, Mr. Speaker, when one asks a question of a minister. Did I phrase the question wrong, or did the minister just not understand what I had to say?

Some Hon. Member: (Inaudible)

Mr. Jenkins: The member opposite is suggesting that, generally, I am wrong. Well, on occasion, more often than not, we are right.

The minister did thank me for my letter of August and did point out that the act provides the Governor in Council, upon recommendation by the Minister of Transport, the authority to direct NAV Canada to provide air navigation services in northern and remote areas. This section is intended to enable the federal government to ensure that services are provided at locations where NAV Canada may not otherwise do so. It does not grant authority, however, to direct NAV Canada on matters pertaining to user charges.

It looks like we're going to get it one way or the other. We're going to be bearing the costs of NAV Canada.

The charging principle of this section - it deals with northern and remote services - states that the charges must not be higher for remote and northern services than charges for similar services utilized to a similar extent elsewhere in Canada. Again, this is an area that one has a difficult time coming up with an area in southern Canada that compares with an area in northern Canada, has the same type of services and is utilized to a similar extent. It's very, very hard to find parallels of this nature. In fact, some of these I've tried, and I cannot find a comparison of anything in the north to what is transpiring in southern Canada.

But the minister went on to say that NAV Canada's proposed fee system does not appear to contravene this principle. Mind you, if you can't find an example, I guess it doesn't contravene the principle. They went on to say that the corporation has chosen to implement system-wide charges, based on a system-wide allocation of costs.

Users of Canadian airports will benefit from the commercialization of air navigation services. The minister went on to say that, after November 1, 1998, when NAV Canada will be fully cost recoverable, the revenues obtained from over-flights - flights that do not land in Canada - and oceanic services that often fly over the north Atlantic, will leave approximately $610 million to be recovered for domestic arriving and departing aircraft.

And in order to fully recover the cost of providing services, the air transport tax, which was formerly used to pay for these services, would have cost users some $780 million in 1998 had it continued in its present form. The difference represents a saving of $170 million annually for users.

Again, what this serves to do, Mr. Speaker, is load the burden of responsibility for a lot of these incurred costs on northerners. We are going to be paying an additional premium to fly around the north or to ship anything into the north, because the air navigational system is utilized to a much lower extent in the north than the south. Our population and our distances between centres are very, very significant. Virtually all of the service into the north is north-south. There is very little east-west air transport service in Canada, north of 60.

How we can hope to realize these savings in the north is beyond me.

The minister went on to state that NAV Canada is expected to achieve further efficiencies and cost savings over the coming year, providing even more benefits to users. What these benefits are and will be is beyond me, Mr. Speaker. Basically, north of sixty, we're looking for decent airport facilities and decent advisory facilities. The one centre that was operating in the western Arctic, in Inuvik, has been closed down. The controlled airspace is now operated in the western part of Canada in the north, out of Edmonton Centre - very, very remote and very costly to operate, but very necessary, but very necessary, indeed, Mr. Speaker, when one considers that it's basically the only way to get between communities or to move goods between many communities north of 60.

The minister went on to say that the move from a tax-based to a cost-based system is intended to ensure a more equitable distribution of costs. Wow, that's a statement and a half. This will provide economic efficiency in the use of transportation services. Under the previous system, certain users contributed very little to the cost of the air navigation system - for example cargo operators, except for over flights and oceanic services, paid nothing toward the cost of a system that benefits them as well as other members of the aviation community.

Mr. Speaker, that's just the point. Cargo service in the north is a lifeline for many northern communities. They are now going to have to pay considerably more for the ability to fly point to point in Canada than ever before.

The ministers went on and assured me that Transport Canada has undertaken a serious and thorough review of NAV Canada's user-charge proposal, taking into account the charging principles set out in section 35(1) of the act. The department considers international practice and used its lengthy experience in justifying fee proposals to such bodies as the International Civil Aviation Organization.

Transport Canada officials have sought legal advice on their findings. All of these measures have confirmed that the proposal is consistent with the charging principles of the act. Consequently, I have no option but to approve the proposal and, this being the case, I wrote to NAV Canada on September 5, 1997 to grant approval of its revised user charges, which will come into effect on March 1, 1998. That being said, the current round of consultation has served to highlight to NAV Canada issues of importance to its client. I understand that the corporation is open to more extensive discussion as it prepares for the second set of fee proposal schedules for implementation on November 1, 1998.

The consultations are expected to begin as early as December 1997. I would encourage you to make your views known to NAV Canada officials over the next few months, so that cooperatively a set of fee proposals can be designed which will be sensitive to the concerns of the north while, at the same time, respecting the charging principles.

So, we've been given a window of opportunity, Mr. Speaker. We've been given a window of opportunity to provide input into the second set of increases in user fees proposed by NAV Canada.

We can go on at great lengths, Mr. Speaker, but what we are looking for in the north is to maintain a reliable, financially viable mode of transportation in the air. We have a scheduled carrier now that has proven itself over time to be able to provide that service. The cost to you and me, the end user, Mr. Speaker, has been growing, and under this change imposed on us by the federal government, the cost of a ticket for you, for me, and for any member of our family, or to ship any goods, is going to rise disproportionately in the north than they will in the southern parts of Canada.

In closing, Mr. Speaker, I would urge all members of the House to support this motion, which will serve to benefit northerners and those we attract here for business or for pleasure. I would urge the support of all members of this House on this motion, as I can see benefits accruing to us if we are unified in our approach to NAV Canada in presenting an approach that clearly identifies our reliance on NAV Canada for a multitude of services here in the north, and cannot be replaced, in a number of cases, by any other means of transportation.

So, it's a win-win situation if all members of the House join with me and support this motion.

Thank you very much, Mr. Speaker.

Hon. Mr. Keenan: Mr. Speaker, it gives me pleasure to rise today to speak to this motion, as presented by the member opposite, the Member for Klondike.

There are not many times in my life that I would tend to agree with the member opposite, but certainly, for the most part, at this time I do agree and endorse what the member opposite has been saying in his talk.

I will not take much time, for certainly the member who spoke before me has certainly spoken about the history and the implications of what it means. Let me just say, Mr. Speaker, that yes, it affects all life, all industries here in the Yukon, certainly not only just the Yukon, but certainly everywhere north of 60.

In my home community, and many communities - eight communities - there are CARS sites. They're funded by the corporation; they're administered by the Yukon government. There, whether it's for exploration, for going out and enjoying the privilege of flying, they come in just so very handy, not just to maintain the status quo, Mr. Speaker, but certainly to go forth and to bring new revenue and economic growth into the territory.

I want to say that, although the air traffic dollars in the Yukon are not sufficient to generate the revenues necessary to support the most basic safe level of service, the federal government has made a commitment, through Bill C-20, to maintain the existing services in the north and the isolated locations without cost premiums. The cost of this commitment will be funded by Canada and by user fees.

Our government has indicated that it supports the principles of improved efficiency and long-term savings that commercialization of the ANS will bring, and that the Yukon government is monitoring the actions of NAV Canada closely to ensure that service levels are maintained and that a safe and efficient transportation system in the Yukon is not jeopardized.

As the member previously has spoken, NAV Canada is currently undergoing a national review of the air navigation system it provides. Part of this review is a system-wide analysis of the northern remote areas, rather than a site-by-site evaluation. How that works is that NAV Canada has proposed that the review, commonly known as the north of 60 study, will be driven in part by an aeronautical study team comprised of members of NAV Canada and the territorial governments.

The study team will identify and define the Air Transport Commission, the FFS, and the community aerodrome radio station service and hours of operation of each site retained or established, identify the need for additional training at busier CARS sites and recommend the number and location of remote communication outlets.

The current service levels of the ANS in the Yukon were protected when Bill C-20, the commercialization of the civil air navigation service, was passed in 1966. But, certainly there was an opening, and if the corporation proposes to terminate or reduce the Yukon-designated northern services, implementation is only possible if the territorial government or users have not rejected it or, as in this case, the Minister of Transport approves the proposal. So, we've been given and taken.

The aircraft and control personnel provided very positive aircraft separation within five miles of the airport, aircraft clearances and limited weather information.

The towers are generally established when aircraft movements exceed 60,000 a year. Aside from the weather briefings and the advisory service and the past clearances, et cetera, the 1996 Whitehorse aircraft movements totaled 42,545 movements in 1996. Now, this does not include the 6,000 movements at Schwatka Lake during the summer period.

Just on that note, Mr. Speaker, I think that we should have a better understanding of the Schwatka Lake and the proximity that it has to the Whitehorse airport. Therein certainly lies a danger, when you have two different locations, a float plane operation and a wheel-based operation. That must be taken into consideration.

One moment please.

Mr. Speaker, it is said and it is true, as the previous member has said, that there is going to be a window of opportunity and I encourage all users and certainly everyone who is concerned about this predicament to bring forth their thoughts to this round of consultation. In a letter that I sent to the hon. David Collenette, I expressed very grave concerns, one of which was that the consultation process was certainly inadequate. In Mr. Collenette's reply, he said that he understands that the corporation is open to more extensive discussions as it prepares for the second set of fee proposals scheduled for implementation on November 1, 1998. These consultations are expected to begin as early as December 1997.

So, I certainly encourage people and users to bring forth their concerns.

I've also brought forth a concern that aviation safety should not be and could not be compromised, Mr. Speaker. I do believe, as I've just said a few moments earlier, that there is a possibility that air safety could be compromised, and again I encourage all people that are part of this dynamic that they should be making presentations.

Without repeating what the previous member has already said, Mr. Speaker, I will not reiterate many of the comments because, as I've said, certainly, on this issue, for the most part, I certainly can and do agree with the member. Again, I reiterate that we should be taking advantage of the window of opportunity and to clearly let our views be known.

Mr. Speaker, I can certainly support the motion, but I think there's one consideration that should be thought of and should be considered within this motion, and I would encourage, after I speak about it for a few moments, that all members would agree with the motion.

And, Mr. Speaker, that is of the people that are affected by this - the labour force, the actual people that are there and have hands-on knowledge.

The flight service station employs a total of 14 people. The air traffic control employs seven persons. One person is acting as the general manager.

We've got to consider this and take this into consideration. There was a public meeting on December 4 here in Whitehorse. During that public meeting, NAV Canada suggested that it is likely that the study will confirm that either the tower or the FSS will close - one or the other, based on the movements. So, Mr. Speaker, not only are we going to be cutting back on a health and safety aspect and maybe, in part, restricting the economic growth of this territory, but we are going to be laying off people who are valuable and very much a part of the Yukon.

With that, I would propose a friendly amendment to the motion.

Amendment proposed

Hon. Mr. Keenan: I move

THAT Motion No. 70 be amended by deleting the second paragraph and replacing it with the following paragraphs:

"THAT it is the opinion of this House that:

1) NAV Canada may be seeking to reduce national staffing levels and services;

2) NAV Canada may be planning to close the Whitehorse air traffic control tower (ATC) and have all service provided by flight information services (FSS); and

3) staffing reductions and closure of the air traffic control services (ATC) would result in overall reduction of services to Yukon consumers;

and

THAT this House urges NAV Canada to reconsider its proposal to replace the air transportation tax with user fees, and strongly objects to Canada's Minister of Transport approving NAV Canada reduction of staffing levels and services."

Thank you very much.

Speaker: It has been moved by the Minister of Community and Transportation Services

THAT Motion No. 70 be amended by deleting the second paragraph and replacing it with the following paragraphs:

"THAT it is the opinion of this House that:

1) NAV Canada may be seeking to reduce national staffing levels and services;

2) NAV Canada may be planning to close the Whitehorse Airport Traffic Control Tower (ATC) and have all service provided by flight information services (FFS); and

3) staffing reductions and closure of the Air Traffic Control Services (ATC) would result in overall reduction of services to Yukon consumers; and

THAT this House urges NAV Canada to reconsider its proposal to replace the air transportation tax with user fees, and strongly objects to Canada's Minister of Transport approving NAV Canada reduction of staffing levels and services."

Hon. Mr. Keenan: Mr. Speaker, I do believe that this is a friendly amendment, and that it will incorporate our thoughts on this side of the House and build upon the thoughts that the member opposite has certainly spoken to in his preamble.

We do not want to see a reduction in national staffing levels as they may be doing it. I do believe that the information and services that are provided by the flight information service are very, very much an integral part of the territorial government makeup, and certainly, as I've spoken before, the staffing reductions and the closure of the ATC would result in an overall reduction of services to Yukon consumers.

I do believe that speaks to the continued building of the Yukon economy, and certainly to keeping the people employed as they would be employed for this very, very serious situation that we find ourselves in.

Those are my comments.

Mrs. Edelman: Well, Mr. Speaker, generally speaking, the Liberal caucus, of course, always has concerns when jobs disappear from the Yukon. That means a lot of money that comes into our economy. Quite often people move out of the Yukon and that tax base and those people who add to our community in every sense of the word go with them.

My concern with the amendment, however, is that there is a study that's going on right now and it is examining whether or not there is going to be a change in service levels to Yukoners and whether or not there is going to be any actual benefit to keeping both services open. So, I think that we may be jumping the gun just a bit here, and we always have to be aware of the fact that there's only one taxpayer.

On the other hand, it's always wise to keep Yukoners working. So for that reason, the Liberal caucus would support the motion as written.

Mr. Phillips: Mr. Speaker, I support most of the motion. I guess I share some of the concerns that the Liberal member has just mentioned, and that is that the part of the motion that's says, "strongly objects to Canada's Minister of Transport approving NAV Canada reduction of staffing levels and services."

I'm not sure whether that's been done yet. My understanding is that they've been discussing it and there's a report that's coming forward. I know that there is a debate itself that is going on between people in Whitehorse who are involved in both services on whether or not both services are completely needed in this territory. I mean, what I would be concerned about as a legislator is, of course, the jobs.

The jobs are very important, but when you look at the numbers that I've seen, there are a lot of airports in southern Canada with far more takeoffs and landings than Whitehorse has, far more traffic than Whitehorse has, that haven't had both flight services in the tower for many years and operate quite efficiently.

We're probably one of the more expensive airports, compared to the number of landings and takeoffs that we operate. We're probably one of the most expensive ones, because of the number of takeoffs and landings.

So, I guess what I'm concerned about is, first of all, that safety is paramount - that we make sure we protect safety. Then, as the Liberal member said, there is only one taxpayer. Years ago, I think we had quite a bit more traffic than we had in Whitehorse. We had several airlines landing here. There were quite a few more landings and takeoffs, and I think that, at that time, both were warranted.

We shouldn't be too hasty here before we've even seen the report and the final recommendations of NAV Canada. I think that the debate is still going on, and that what we should be doing is addressing the issue of the staffing when we know what they're going to do. To strongly object to it now and not have all the figures and numbers in front of me, and not have all the safety issues addressed in a fair way, is maybe not the approach to take. I appeal to the Minister of Community and Transportation Services, who put that in front of us, to maybe look at an amendment to this; to amend it in some way so that, say, in case the report says that both services are needed, we have no reduction in staffing and level of services.

I'm just concerned that we're jumping the gun here. We hear the side opposite stand up and talk about pay-as-you-go government - a government that is going to reduce the cost of services. We know other costs are escalating. We shouldn't be making decisions about issues such as this until we have all the facts and figures before us. That's all I'm saying.

I feel a little bit reluctant to support this part of the motion, Mr. Speaker, because I don't have the facts and figures before me. I don't have the recommendation of NAV Canada, and what they say. I'd like to hear more input from the airline industry in the territory, who use the services. I'm a former pilot myself, and I've utilized the services of the tower many times. In fact, the people in the control tower literally saved my life one time, and I'm indebted to them.

My concern here is that we've got to look at delivering safe services to the general public, we've got to look at delivering it in a cost-effective way, and we've got to examine from time to time the programs we're delivering. I mean, we do this, the Minister of Health and Social Services does it - when the demand for social assistance goes down, we don't hire as many people to deliver the system; when it goes up, we hire more people to deal with the situation then. And I think that's exactly what NAV Canada is now looking at - the total cost of delivering the system based on the number of takeoffs and landings.

What I'd like to have in front of me, and I don't, is the other airports across this country in southern Canada who actually have quite a bit more traffic than we have in Whitehorse and exist with just one of the two services, and do it in a fairly safe manner, and to hear from the airline industry, the experts, the people themselves, from air radio and the tower, to see how they feel about it, before we jump the gun here and say that we reject the staffing reduction.

I don't know if that's really responsible with the information we have at this time and that's my concern, Mr. Chair. Safety is paramount but I also have to realize that things have changed over the last few years in this territory with respect to the amount of traffic. And technology has changed from the technology that we had 10 years ago.

For instance, I talked earlier about my particular episode, where the control tower saved my life and the lives of three other people who were in the aircraft with me. At that time, we didn't have the capability in the territory to pinpoint where someone was by radar or by some other communication means, and we were doing a lot of voice-level communications, where I was keeping the same tone of voice and talking on the radio and they were trying to determine whether the voice was increasing or decreasing, because there was no other way at that time to determine the direction I was from the Whitehorse Airport because a severe storm had moved into the Whitehorse area.

As a consequence of that particular incident, they upgraded their equipment. Now their equipment has been upgraded considerably more since then. Now, they are able to track those kinds of individuals through air radio and through other communication means. So, I think that a lot of changes have happened. We can't just ignore those changes. I have respect for the jobs of the people who are up there, but I think that even some of those people have seen their workload in the last few years decrease dramatically and have seen the technology increase so that it takes less time to do what they normally do.

We have to have an appreciation of the changes that have happened, from the numbers to the technology to whether we can deliver the system in a safe manner. I don't know whether the minister is hearing me or not, but I'm appealing to the minister to look at -

Some Hon. Member: (Inaudible)

Mr. Phillips: No, I mean it in the way of possibly amending his motion, Mr. Speaker. I know what the minister is saying and I know what the minister wants to do. He wants to protect the level of service. He wants to make sure we're safe. But, I'm sure the minister didn't put this forward here just to see extra people in that building whom we didn't necessarily need - the service could be provided with less.

So, maybe we can look at a possible amendment to this amendment, which would accommodate the concerns the minister has about the services. It would have been interesting to hear the minister speak more about it. Maybe he knows something about NAV Canada's reduction in staffing levels. I wasn't aware that the actual decisions had been made on what was going to go yet. Maybe the minister is aware of that. I don't know whether he is or not.

Some Hon. Member: (Inaudible)

Mr. Phillips: The minister said there was a meeting on December 4. I'm not aware of the results of that meeting - if there were recommendations to reduce one or the other or if there was an appreciation, maybe in the report, of the needs in the north and the more severe weather and the further distance between airports and that kind of thing.

I'd sure like to have that in front of me before I just made a decision that I support the minister's amendment that says we reject a reduction of staffing levels and services. I mean I don't want to see services reduced. I want to see the same level of service with the same safety factor built into it.

But, the question I have in my mind is whether or not this can be delivered by the people who know if it can be delivered in a safe manner. So that's the concern that I have.

So I have difficulty in supporting the amendment, primarily because we don't have the information in front of us. So I would have to ask other members to consider that. In my view, it's premature to make a blanket statement that this is how we feel about the issue when we just don't know what the recommendations are.

So, I'll leave that with you, Mr. Speaker, and tell the member that I have a great deal of difficulty in supporting the amendment, and that is the only portion I have a problem with because of the unknowns that are still out there. I believe the amendment is a bit premature.

Mr. Livingston: I rise to support the amendment.

I think that the amendment broadens the scope of the motion to ensure that we address issues of, I guess, the current personnel that are there, but I guess as the speaker opposite has mentioned, most importantly, the safety of Yukoners as they travel in and out of the territory by air. And, I think that what it does is to take essentially a proactive approach.

As I understand, the meeting on December 4 was an exercise in consultation on the part of NAV Canada to try to determine just what Yukoners thought about the proposed cutbacks.

It would seem to me, Mr. Speaker, that this is an opportunity for this Legislature to speak quite clearly on this matter.

The member opposite, the Member for Riverdale North, talked about safety and I think that safety really is at the core of this particular issue - ensuring that we have safe travel in and out of this territory and safe travel inside of this territory when people are travelling by air.

I understand that, in 1996, the Whitehorse Airport movements totalled 42,545 in and out of the airport in Whitehorse. This does not include the 6,000 movements at Schwatka Lake in the summer period. Of course, one of the features that is somewhat unique in Whitehorse is that the amount of air traffic will vary considerably by season and I think that seasonal difference is one of the factors that we think should be considered when we take a look at what level of service needs to be provided here in order to ensure safety, in order to provide adequate information, adequate information for flight planning and for the air traffic that converges on the airport at various times.

So, Mr. Speaker, I would urge members to take another look at the amendment. I think that it's in the spirit of the original motion and it does urge us to take a position while NAV Canada in fact is doing its consultation. One would assume that, because it's doing its consultation, it still has not reached a final decision. We have to remember that the position NAV Canada is going to come out with at the end of the day is going to be in the interest of NAV Canada. It's certainly going to be within its mandate, but it's also going to be addressing its corporate interests. With the decline in subsidies that will occur over the next, I believe it is, 14 months from the federal government, it is certainly having to work hard on that bottom line. I respect the need for services to be provided in a cost-efficient kind of a manner, but I would underline that some things, lives lost, for example, through air accidents - and I note in Monday's paper there was reference to one where they felt they had lost some air services, air traffic control services. This was in Quebec and they had nothing. That's right.

Some Hon. Member: (Inaudible)

Mr. Livingston: No, but it was interesting because it was after a deliberation. The member opposite says it was that the service in Quebec did not exist and that's true when this accident occurred, but it moved from a position where they had something to where the recommendation was made that they could do without and they did.

They eliminated the service, and the result was, apparently, an accident, and the conjecture is that, in fact, it was because of the absence of that service. So I urge members to support the amendment.

Ms. Duncan: Mr. Speaker, I rise to speak regarding the amendment.

The difficulty that we have in discussing this amendment is, as my colleague from Riverdale South has noted, we're always concerned when there's a loss of jobs within our territory. There are too few Yukoners at work as it is, and too few jobs as it is. Now, in particular, with our high rate of unemployment, further loss of jobs is of tremendous concern.

The difficulty that we have with this amendment is that there are too few facts on the table. There is not enough information being presented to members to have a reasonable and thoughtful discussion. We're being told that flight services provides service to Whitehorse airport outside of regular business hours, in any event, and that, particularly on point 3, the Member for Riverdale North has said that point 3 in this amendment is redundant, and it isn't necessarily true.

The concern that we have and the point I wish to have on the record is that perhaps a friendly amendment to this amendment should be given thoughtful consideration by members, in order that all facts might be considered on the table when we're discussing this motion.

Mr. Ostashek: I want to speak to this amendment. As the member before me from Riverdale North said he could speak from experience, I believe that I also qualify to speak from experience on this amendment, having flown and utilized the services of both air radio and the control tower for a period of some 20 years.

I appreciate that none of us really like change. I think that's a human trait. We get set in our ways. We think that things can continue the way they are forever, and we are very reluctant to accept change. We also always look for the downside of change - well, Mr. Speaker, maybe I shouldn't say always, but more times than we look at the positive aspects of change.

Now, I know that in a small jurisdiction like the Yukon, we can't see very much that is positive when we have jobs reduced. On the other hand, Mr. Speaker, as taxpayers, we all have great difficulty with the high level of taxes that we pay, and whether we like it or whether we don't like it, the two are interrelated.

We want governments to act in a responsible manner, and I think that's the message that's been given to all levels of government, especially over the last four or five years when we almost hit the financial wall and governments had to start looking at doing things differently and had to streamline their services.

While I, for one, believe that we ought not lose NAV Canada completely from the Yukon, as a person of the flying public who utilized those services for many, many years, I have great difficulty in saying that I believe that both air radio and flight tower services are required at an airport the size of Whitehorse. It just does not make sense from a safety point of view or any other point of view outside of protecting jobs that are here in the community now. I don't believe that we would be impacting the safety level one iota if the services were streamlined.

I wouldn't be able to say that, Mr. Speaker, if I felt it was going to compromise safety in any manner.

We, over the years, have been very, very fortunate in the north but we have been looked after in a very grandiose manner by the federal government. There is a multitude of federal dollars that have come to the Yukon. There's no doubt that a lot of it was required. An infrastructure was set up here that required a lot of dollars to maintain, and it went on until there were no more dollars to maintain it, Mr. Speaker, and we, in this Legislature, can be very critical of the federal government at times, and I can probably be one of their worst critics when necessary, but I also believe that we need to be able to look at changes with an open mind and not just look at the negative aspects of them. We also must maintain safe air operations in the Yukon. We don't want to see that compromised.

Now, I understand that there is a planning process going on right now in Whitehorse as to what level of staffing, if any, should be maintained in Whitehorse. I don't believe that I'm prepared to make a decision at this point that all of the staff needs to remain at the Whitehorse Airport in order to have a safe operation. I think that's being very narrow-minded and very narrow-focused.

I am just as concerned as other members in this Legislature about the loss of those positions from the economy of the territory. But, Mr. Speaker, if we're going to ask our federal government or any level of government to be more responsible in how they spend taxpayers' dollars, then we have to look at what can be cut without compromising the level of service that we're enjoying.

When the hon. Member for Teslin proposed his amendment about the jobs, I never heard him expand that this was going to compromise safety if these jobs didn't remain. I think that should be the foremost consideration in our minds when we talk about the level of service that we're asking any level of government, or any organization, to provide to us. Is the cut in the number of personnel that are going to be employed at that facility going to compromise the safety of air traffic in the Yukon? That should be our first consideration. If it does, if any of the members opposite can get on their feet this afternoon and provide me with some evidence that they believe the safety of people who are travelling in aircraft or utilizing those services is going to be compromised, I may be able to have more support for the amendment. Right now, I can't, because I haven't heard that.

I believe the motion that was put forward by the hon. Member for Klondike covered off what is the concern of all of us in the north, Mr. Speaker, and that is that the proposed user fee changes to the navigation service in Canada will add cost to air service. That's the basis of his motion. We don't want to see the cutbacks of NAV Canada or the increased cost having a negative impact on our services. We don't want to see the safety of the travelling public compromised.

The amendment, Mr. Speaker, goes on and asks for the deletion of the second paragraph, and the second paragraph states that this House urges NAV Canada to reconsider its proposal to replace air transportation tax with user fees so northern Canadians will not have to bear additional costs than what is currently being charged for navigation services.

The hon. Member for Ross River-Southern Lakes wants to omit that paragraph. In speaking to the amendment, he never gave any rationale why he wanted to delete that paragraph.

Does he believe that NAV Canada should be putting in place user fees? Is that what he believes? Is that why he wants that clause removed from the motion?

The intent of the motion, as I understand from the Member for Klondike, was that we are against imposing user fees on users of the system in northern Canada because those additional fees, if they are in excess of what's being charged in the south for air navigation services, will have a detrimental impact on our economy.

Now, the amendment, Mr. Speaker, says that it is the opinion of this House that NAV Canada may be seeking to reduce national staffing levels and service. Well, certainly they are. Let's call a spade a spade; certainly they are. They've got to address the cost of providing a service that the federal government was providing at great expense to the taxpayers, could no longer afford to provide and they need to find a way to do it better. Quite rightly, they are seeking to reduce national staffing levels where acceptable and where it will not compromise the safety of aircraft.

I believe we in this House should be supportive of that. We should not be criticizing that. And, point 2 of his amendment says that NAV Canada may be planning to close the Whitehorse air traffic control tower and have all of the service provided by flight information services.

Well, Mr. Speaker, I believe that that's an appropriate examination that they ought to be making. I have thought that for many, many years. I've flown into many airports in the north and I can talk about what I used to consider my home airport, Burwash Landing. Back in the 1970s, we had seven and eight people staffing that facility. Why? Because it was a process that was put in place by the federal government at a time when navigation aides were not as good. Air radio communication was not as good. Weather information was not as good as it is today, and those people were required then. But, as time went on, as with any other - especially a government organization and, until we run into a cash crunch, we don't examine in detail what we are doing, we don't look to make changes until we hit a financial crisis and then, when change is forced upon us and we have to make that change without having the leisure of the nice, lengthy time frame to be able to absorb that change.

So, I don't have any difficulty at all with NAV Canada looking at the possibility of combining air traffic control services and flight services. I don't have any difficulty with that at all, as long as it doesn't compromise the safety of the travelling public. I say again, Mr. Speaker, for the record, the members opposite, in their support of this amendment, have not given me any evidence of that whatsoever. I think if we're going to have an intelligent debate on this, other than just a wish that we don't want to see jobs lost, which is the same feeling that members on this side of the House have - we don't want to see jobs lost either, but we have to face the reality of the technological world that we're living in today.

I guess my question would be to the Member for Ross River-Southern Lakes: does he believe that we ought maintain those jobs even if they're not necessary to provide safety to the travelling public? If that is his position, he ought to say so on the floor of this House and we'll know what we're arguing about and what we're debating about, because that certainly is not my philosophy nor the philosophy of my colleagues in the Yukon Party caucus. We believe that jobs need to be maintained if they're required to provide the service.

Clause 3 says, "Staffing reductions and the closure of air traffic control services would result in an overall reduction of services to Yukon consumers." Well again, Mr. Speaker, I have not heard of any evidence from the members who have spoken so far to this amendment and especially from the government side from where the amendment was proposed that that would, in fact, be the case that Yukon communities would have an overall reduction in services.

I don't know what justification the Member for Ross River-Southern Lakes made for that clause 3 of that amendment that "staffing reductions and the closure of air traffic control services (ATC) would result in an overall reduction of services to Yukon consumers." I don't know what evidence he has for that.

Then he goes on in the amendment, Mr. Chair, to say that the House urges NAV Canada to reconsider its proposal to replace the air transportation tax and user fees, and strongly objects to Canada's Minister of Transport approving NAV Canada reducing the staffing levels.

Well, again, Mr. Chair, we can agree with part of that. That's part of what was in the original motion and it need not have been deleted, when in fact it was stated in the motion. I don't know what merit there is in deleting a clause in the motion and then reinstating it basically in very similar language if in fact the members opposite are in agreement with the Member for Klondike that we ought not to be implementing user fees.

So, Mr. Chair, for the reasons that I've laid out, I just cannot support the amendment. My staff right now are drafting a friendly amendment to this that I would like the members opposite to consider, and I hope it arrives here shortly, before I run out of time to speak. Members opposite may not want to get up on their feet and may want to rush a vote on this.

But, Mr. Chair, I think that this motion was a very worthwhile motion to put on the floor of this Legislature, and I would like to see a motion that all members in this House can support. I don't think that this kind of a motion ought to be a motion of one-upmanship - "We don't like your wording; we'll put our wording in. We don't like the wording you put in; we'll put our wording in." I would just like the members opposite, if they want my support to this amendment, to get up and give me some rationale as to why I should support it. They haven't done that.

Some Hon. Member: (Inaudible)

Mr. Ostashek: Mr. Chair, the Member for Whitehorse Centre says I have to sit down. Is he indicating to me that he's going to speak to the amendment? I may sit down if he does.

Mr. Speaker, I will take the Member for Whitehorse Centre at his word that he's going to speak to the amendment, because I really want to see a motion passed on the floor of this House this afternoon that satisfies all of our caucuses and will not be one that we have to vote against different amendments on just for partisan political reasons. We ought to be able to come up with a motion here that deals with the issue and, Mr. Speaker, the issue that I feel is before this House is a reduction of services to air traffic in the Yukon.

Mr. Speaker, for those reasons I cannot support this amendment and, at some point, we will be proposing a friendly amendment.

Mr. Hardy: I hope the member's friendly amendment gets here pretty soon. Crack the whip a little bit there.

I don't think we, on this side of the House, are trying to do a one-upmanship or any of that kind of stuff. We are trying to flesh out a motion that we do support in general and that would also reflect some of our concerns as well. Hopefully the friendly amendment will come and will satisfy everybody in the House.

The Member for Porter Creek North mentioned a few issues and wanted some proof. Well, there's not much proof before the fact, but any time you do reduce services, of course, it's going to have an effect upon the services that you supply to a business or a person. Often what happens when you're dealing with very, very dangerous situations - changing weather conditions has already been mentioned by people on the other side as well as on this side - you don't want to play around too much with it. You want to make sure that, if there are going to be any changes made, everything is covered before the changes are made.

But I do have a few things here, and some of it is actually from the meeting that was held. NAV Canada's flight service station employs 14 people. Seven are employed in the air traffic control tower and one person is currently employed as a general manager for three air traffic control services in Whitehorse.

The changes that could happen can be a reduction in having people there who respond to needs where you have to have another person on the end of the line - not a machine, not an answering service and not a printout. You actually have to have someone to talk to and to assist you through your difficulties. I don't have the experience that the member opposite from Porter Creek North has in flying in the Yukon, even though, when I was 16 years old, I did take flight lessons and did do some elementary flying in the Yukon as a young person. I definitely don't have the long background, but I do know many pilots, and I do know the conditions in the north, as I have flown with many of the pilots up north.,

I will read some of the comments from the public meeting, because I think they're reflective of what people feel out there: "NAV Canada suggested that it is likely that the study will confirm that either the tower or FSS will close. One concept that's been proposed is to retain the tower and convert the FSS into a flight information centre," which they abbreviate as FIC. "FICs would theoretically group a number of flight service stations into one and provide services over a broad regional area, rather than a small, local area."

I think right there is a small alarm bell, especially with the changes with the weather station that we've just undergone, as well as keeping track of very quick weather changes and the conditions that may arise in some of these mountain passes or over lakes, especially - we haven't talked about float planes very much, but that's a big concern up here, because many people fly using the lakes and float planes.

An FIC for the north, in Whitehorse or Yellowknife, has been discussed over the past few years, but has not been developed beyond the concept stage. The Yukon program will also be reviewed - our CARS program - as part of the study. NAV Canada officials indicate that they are pleased with the Yukon program, and do not foresee any major changes in the distribution of that level of service.

Some of the comments there - users attending the Whitehorse meeting complained about poor communication access - calls not answered, calls placed on hold for long periods of time to Whitehorse flight services. Persons representing Yukon commercial operators complained that the FSS has not been able to respond quickly enough to their flight planning needs. Private discussions with one large Yukon operator indicate that there may be growing support to retain tower services, but have the Whitehorse FSS replaced by a CARS system.

It goes on, "Closure of the Whitehorse tower could be viewed by major air carriers as a significant reduction in service at the Whitehorse Airport. It possibly could be argued that the tower closure might detract major carriers, especially foreign carriers, from using the airport."

So not only do I feel that there's potential for safety problems - and they are being expressed by the industry - but there's also the potential of the negative impact it'll have on trying to attract some major carriers into the north, and that'll definitely have an impact on revenue, tourism and the businesses around.

As well, a pilot is listening to the debate, and I got this scratched note out, listing some of their concerns. There is sufficient traffic during busy periods to warrant air traffic control, especially when we factor in float plane traffic on water. Now, the tower, I believe, services Schwatka Lake, and that's a concern, as well. It's not just one airport, but there are small airports around the Yukon, plus Schwatka Lake, that we have to consider. We can't just be thinking about a major airport, which maybe can be covered that way, but we're talking about a lot of small airports.

This person goes on, "I'm a beginning pilot and value the air traffic control service. I've been cleared to land and, at the last moment, directed to another runway because of a sudden shift in the wind. How do you put a price tag on a flight service that can provide that direction." That's really service because a person is there, able to give you that direction. I wonder, with the reductions that may happen, and I think will happen, any time you get a change like this, will that kind of service be there? I don't think there's a person anywhere that wants to see a flight accident happen.

Users say that if something has to go, it should probably be the tower. Now, that's if something has to go, you know, like, maybe the tower should go, but they'd much rather keep it, of course. They do know how valuable it's been in the past. They know how valuable it's going to be in the future, and it's a concern.

Cost recovery for that service is impossible, given the small user base. That's an ongoing debate that I think we'll have once we get out of this amendment.

That's about all I have to say - just some comments that were passed to me from the meeting as well as from people listening, and also my own general observations that any time you start to reduce personnel, even with technological changes, you are going to have an impact on service. This is one area where I would be very, very hesitant to say that it's not going to have an impact, because I believe that an accident in this area often means death. It's not a car accident.

Mr. Cable: This amendment better get here in a hurry.

Mr. Chair, I think this amendment might demonstrate the need for SCREP to look at the rules for amending motions. What we have in front of us is, "that it is the opinion of this House that, number one, NAV Canada may be seeking to reduce national staffing levels in services." Let me tell the minister that whatever the opinion of this House, that is not changing the fact. That's like saying, "It's the opinion of this House that the Clerk may be considering going down to McDonald's for supper." It's not going to change the fact that the Clerk is thinking or may not be thinking of going to McDonald's for supper.

It's also the opinion of this House that NAV Canada may be planning to close the Whitehorse air traffic control tower. They may or may not be, but whatever the opinion of this House, it's not going to change the fact of what NAV Canada is doing.

We can support this, because it means virtually nothing, I suppose, but what does possibly mean something is the part of the motion that says, "it is the opinion of this House that staff reductions and closure of the air traffic control services would result in an overall reduction of services to Yukon consumers."

Now, what we have in the House today is a group of people, some of whom have flown aircraft, such as the leader of the official opposition, who is telling us that he's unsure that there will be any safety problems, on one side, and we have the minister, who is putting out some innuendo suggesting that there will be a reduction of services. Assumedly, the minister in charge of the airport has reached this conclusion.

So, here we are, some neophytes in the air traffic control business, being asked to choose between the two positions being put forward. We have the spectres being raised by the minister, some might-bes and some could-bes and would-bes, and we have some facts put forward by the leader of the official opposition. Where we find ourselves in the Liberal caucus, not being familiar with the air traffic control generally, or for that matter, the moving of aircraft around the country, we find ourselves having to judge the opinion, which I think is that of the minister. He hasn't stated categorically that staffing reductions and closure of the air traffic control services would pose a problem. All he's doing is sort of raising some spectres and innuendo and hopefully when he gets up to conclude the debate on the amendment, he will state to the House assertively whatever the set of facts are, in his view, and whatever the set of facts are that the minister's officers have told him.

Now we've heard also that there's a study underway, presumably by some people who are in the know, dealing with these very issues that were raised by the minister dealing with the issue of staffing reductions and closure of the air traffic control services and dealing with the alleged fact that these reductions and closures would result in overall reduction to services to Yukon consumers, and, assumedly, in the same vein, that there would be an increase in safety problems with these staffing reductions enclosures.

Now we don't know that. We haven't seen the studies. The leader of the official opposition suggests, and perhaps with good reason, that the minister's jumping the gun on this.

Then we have the last paragraph, that this House urges NAV Canada to reconsider its proposal to replace air transportation taxes with user fees and strongly objects to Canada's Minister of Transport approving the NAV Canada reduction of staffing levels and services.

Now from what I've heard, this decision has not as yet been made. Perhaps the minister, when he gets up to speak next, could confirm that.

I must say that I found the speech by the mover of the motion really quite interesting. I was unfamiliar with the NAV Canada setup and had only a very general idea of what NAV Canada was all about so, Mr. Speaker, it was quite useful to hear the history of NAV Canada and to hear that it was set up as a non-profit making organization.

It was also useful to hear the debate to date, as it relates to the amendment of course, that we have here in the Yukon a situation, unlike the more populated parts of Canada, where air transport is the only practical way of travelling in and out of the Yukon, particularly if one has some time constraints on their hands, Mr. Speaker.

At times, during the year, there is little competition in air travel and there is a little downward pressure on travel costs, so any user fees will only exacerbate a problem that few other Canadians experience to the extent we do.

Now, this is particularly relevant to the tourism business - one of the three lifelines of our economy - so it would be very useful to find out whether these staffing reductions and closure of the air traffic control services that are being mooted around would, in fact, result in an overall reduction of services to Yukon consumers, as in the amendment. It also would be useful to find out whether that sort of rationale, that same sort of reasoning, would apply to the people that come here as part of our tourism business.

I've got the better part of 20 minutes still to go, so, I'm going to torture my colleagues as they have tortured me on these various Wednesdays.

NAV Canada contemplates three sets of charges. One of the charges, Mr. Speaker, relates to terminal charges; another set of charges relates to over-flights, and the third set of charges relates to oceanic charges, which would affect our tourism business.

Now, all of these will relate back to what takes place up at the Whitehorse Airport, which is primarily the main entry point - not the only entry point, I should say to the Member for Klondike, but the main entry point - for many tourists from out of the Yukon.

So, what I would beseech the Minister of Community and Transportation Services to do, is get up and unequivocally say that, in his opinion, and based on some research, not based on some bar talk, or based on some telephone calls he's had - well, the minister is saying he is a visionary. Perhaps he can conjure up a vision that could satisfy this side of the House that the staffing reductions and the closing of the air traffic control service would result in overall reduction of services to Yukon consumers. Perhaps he, at his persuasive best - I know sometimes he is very persuasive - could in fact persuade us there will be an effect on safety if there are staffing reductions and closures.

Mr. Jenkins: What we have before the House today is a motion. That motion deals with replacing a tax with a user fee and a set of user fees associated with aircraft movements, aircraft landings and takeoffs in Canada.

The user fee and fees, when they're implemented, will place an added and disproportionate cost on northerners when they utilize air transport and air cargo services north of 60, Mr. Speaker. But we somewhat got off the topic and into the area of staffing levels and all of these other issues associated with the provision of these services, and it's of concern to me, Mr. Speaker, that those discussing this topic are not fully aware of the changes in technology that have driven the changes that have occurred in the provision of air navigation services in Canada and, indeed, in the world, Mr. Speaker.

One only has to spend some time flying around the State of Alaska in the general aviation business. There used to be towers at virtually every airport. There used to be several centres to control instrument flights in Alaska. That's all boiled down to just a few towers today that are staffed on a basis that addresses the level of traffic.

So, when the traffic is low, they are not staffed. They are remoted out of another principal centre. Anchorage centre is the main hub. You can fly into Eagle, Alaska, which is a port of entry into the U.S. When you raise that airport on the radio, you are, by and large, talking to an individual based in Northway, Alaska.

When Northway is closed, you're talking with someone that is in Anchorage. It is very, very interesting to see the improvements that technology has made in the provision of these services. Whether we like them or not, they're coming upon us and they're coming upon us in order to maintain costs at an acceptable level and, as a consequence, these changes in technology usually result, or sometimes result, Mr. Speaker, in a reduction in staffing levels at many of the facilities.

The issue of public safety always comes before us at these times, and the issue of public safety has to be addressed and recognized, because that's one area where we do not want to see any reduction whatsoever - the level of public safety. The changes in technology that we see, Mr. Speaker, have a corresponding reduction in staffing levels and, after the bumps are usually ironed out of the transition period, there is not normally a reduction in public safety. There have been some issues with automatic weather stations that have not proven to be as reliable as they should be, especially when looking for the ceiling or the bottom of the level of clouds. The human eye is much, much better at it than the modern technology or the automatic weather systems. There are some other bumps in the automatic reporting systems that, I'm sure, over time, will be ironed out but, more and more in Canada, we're leaning toward these advances in technology.

So, while I can appreciate where the Minister of Community and Transportation Services was taking us in his amendment to the motion dealing with staffing levels, it's the intent of this motion to deal with the main issue. The main issue is the replacement of a tax with a user fee that will place a disproportionate cost of the provision of these services on northerners.

Subamendment proposed

Mr. Jenkins: Mr. Speaker, I have an amendment to the amendment to Motion No. 70, and it reads:

THAT the amendment to Motion No. 70 be amended by deleting all of the words after subclause 2 in the amendment and by adding the following words:

"THAT this House urges NAV Canada to reconsider its proposal to replace the air transportation tax with user fees and ensure the highest possible level of public safety and the provision of equivalent levels of service."

Speaker: It has been moved by the hon. Member for Klondike

THAT the amendment to Motion No. 70 be amended by deleting all of the words after subclause 2 in the amendment and by adding the following words:

"THAT this House urges NAV Canada to reconsider its proposal to replace the air transportation tax with user fees and ensure the highest possible level of public safety and the provision of equivalent levels of service."

Mr. Jenkins: Well, Mr. Speaker, this amendment to the amendment, a very friendly one for the Minister of Community and Transportation Services to accept, doesn't alter the first two issues that we have in the minister's amendment, but it does serve to clarify the main motion and address the issue of safety and service, and it does serve to address and continue with the thrust of the main motion, which, Mr. Speaker, is we have to recognize the federal government is eliminating a tax and replacing that tax with a user fee, and that that user fee will place a disproportionate cost on those of us in the north who utilize air for their personal transportation or for the movement of goods.

I would urge all members of the House to support the intent of the original motion, as amended and further amended. Thank you very much, Mr. Speaker.

Hon. Mr. Keenan: Mr. Speaker, to tell you the truth I can't support the amendment to the amendment because it certainly does not speak to the staffing reduction and closure of the air traffic control services, which would result in overall reduction of services to Yukon consumers. So, if they cannot speak to the people and to the workers, well then, I don't see where it is good.

Mr. Phillips: Well, Mr. Speaker, I am very, very disappointed in the approach that the Minister of Community and Transportation Services has taken. Basically, what he's trying to do is convert a motion that is going to talk about air transportation tax into a jobs motion. I guess the problem I have with that is that if the minister wanted to discuss the issue of jobs, the minister had every right in the world in this session to bring in a motion to discuss that. But, the minister has tabled an amendment to a motion which talks about jobs, Mr. Speaker, and the minister hasn't provided one shred of evidence to support his motion. In fact, the minister's told us that the decision hasn't even been finally made yet on who might be changing, or what might be changing.

I would have thought that if the minister was going to pursue the jobs issue as paramount to his amendment, he would have done his homework and provided some information. It appears that the minister has come ill-prepared and bootlegged a jobs issue on to an issue that is going to affect all Yukoners, and that is replacing the air transportation tax with user fees, and costing all of us more to fly in and out of the territory.

Mr. Speaker, this amendment to the amendment, in my view, does deal with the issue of safety that I know the Member for Whitehorse Centre brought up and others have raised in this House. It also deals with equivalent levels of service. To just bring the job amendment forward and deal with it strictly as a jobs issue ignores all kinds of things. It ignores the levels of traffic we're experiencing in the last few years; it ignores the technological changes that we've had in the last few years; it ignores almost every question that's out there right now that is unanswered, other than the fact that this may involve some Yukoners' jobs.

Like the leader of the opposition said, it would be sad. I mean, any job loss in the Yukon is unfortunate, but I'm equally surprised at the side opposite standing up in the House talking about running a mean, lean machine and an efficient government and proposing a motion to maintain levels where they are now, when there's actually a report that's going to be coming out discussing the needs for those levels, in light of changes in the past few years.

It seems to me like the cart is a mile and a half in front of the horse here. It's not an appropriate time for us to be making that decision, whether or not those particular jobs are the issue. In fact, the motion was put on the floor today to deal with an area that is totally separate from that. It is to deal, primarily, with the cost of air service and the delivery of air service to Yukoners in the future. And so, I am going to support the amendment to the amendment because I believe that it covers the issue that the Member for Whitehorse Centre, the Member for Riverdale South, the Member for Porter Creek North and the Member for Riverside have all addressed. So, it provides us with the latitude to speak out loud and clear.

If NAV Canada decides that it wants to reduce either the control tower or air radio and the facts and figures don't support their decision, we can all, at that time, scream and holler and join the protest with others and lead the way, in fact, if we wish. Mr. Chair, it appears that the Minister of Community and Transportation Services came into the debate not as well-informed as he should have been with respect to the issues. He certainly came into the debate, tabling an amendment, but provided no facts to back up his amendment. You can't come in here and say there should be no reduction of jobs on account of safety and services and then not produce one shred of evidence. That is going to be dramatically affected, when we're waiting, as we speak, for recommendations to be given publicly.

I think that the member is trying to change the intent of the motion somewhat to accomplish, probably, a political means. He certainly is not looking at it in the context of whether it will affect public safety or will affect the equivalent levels of service in the future. For that reason, Mr. Chair, I have to disagree with the Minister of Community and Transportation Services, who should have come to this House and been up to speed on this issue, and obviously wasn't.

That is kind of disappointing, because this motion has been on the Order Paper for a considerable length of time. That minister had all kinds of time for him and his officials to get briefed on all the details and all the facts and to produce the facts here, and he was going to come forward with an amendment to produce his rationale for the amendment, and he hasn't done any of that. He hasn't done any of that here today. He has just stood on his feet, and in a very short, probably three-minute, speech, said, "It's all about jobs and that's what it's all about and we're voting against the amendment."

But some of his other colleagues have stood up and said that it's not all about jobs. It's all about the provision of equivalent levels of service and public safety, and we brought forth this friendly amendment, which I believe addresses the issue and still allows us all the latitude to speak out loud and clear if we're not happy with the recommendations that NAV Canada comes down with.

So, Mr. Chair, I would urge all members in the House to give serious consideration to the amendment to the amendment and support it, because I think it does exactly what we want to do and allows us the latitude that we need to address the issue.

Hon. Mr. Harding: Well, Mr. Chair, the member opposite just talked a long time, unlike the Minister of Community and Transportation Services. However, the member opposite didn't say very much in that lengthy dissertation.

Mr. Speaker, the reason we can't support the amendment, as opposed to the proposition we put forward, is because it implicitly eliminates the concern for the loss of employment related to this complex issue. This is a complex issue that involves, obviously, more than the jobs. It involves service levels, public safety, and it involves the issue of the user fees. But to eliminate that particular issue after we put it forward, I think, would be cutting loose some Yukoners and Yukon employment that I think is an important considerations.

Now, I'm not surprised that the members opposite aren't concerned about that. Heaven forbid, Mr. Speaker, that the Yukon New Democrats are concerned about jobs in this territory. Well, we don't make any bones about that. We've seen too many federal cutbacks in health care and education and staffing levels to not be concerned about jobs in this territory and levels of service. And, Mr. Speaker, I don't think we're going to make any apologies for that.

So, Mr. Speaker, to cut loose the concern for jobs in this amendment to the amendment, I think, is wrong, and for that reason we implicitly cannot support this subamendment. The intent of it in terms of service levels is fine. However, we're not prepared to move away from the position that we've put on the table that does have concerns about national staffing levels and service.

So, what they are essentially doing with their subamendment to our amendment is asking us, as a party in government, to cut people loose in this territory and across this country, and we're not prepared to do that. Therefore, we have difficulty with the subamendment, even though the general intent of the highest possible levels of service and the concern we have about user fees are common ground on this subject.

So, for those reasons, we can't support the subamendment.

We are very prepared for this debate. We always have been prepared for this debate, and for that reason we put forward an amendment to the original motion that we felt would be more comprehensive and deal with all of the aspects and all the concerns that have been iterated and reiterated on the floor of the Legislature this afternoon.

So, we don't intend to the cut the people loose whose jobs are affected here, in either of the branches of this issue, whether you're talking about the FSS or if you're talking about air traffic control or if you're talking about this territory or across this country. I think there is a fundamental problem here and the approach has been taken by NAV Canada, and it is more comprehensive than just the jobs issue. That's not all we're concerned about. We're concerned about the original intent of the motion that was put forward by the Member for Klondike.

We felt we'd put forward a friendly amendment that was supportable by the members opposite, and we don't make any apologies for being concerned about further job losses relating directly or indirectly to decisions taken by the federal government, so we will not be able to support the subamendment to the amendment, unfortunately, and we are disappointed that the Yukon Party chooses to ignore the issue of staffing levels and jobs. We believe it should have been incorporated into the whole debate, as we look at public safety, service levels and user fees.

So, unfortunately, we won't be able to support the subamendment.

Mrs. Edelman: It's really interesting to hear the different points of view in the House. Sometimes, you wonder if you're talking about the same thing and, certainly, today people are extremely confused.

The first thing is that the amendment to the amendment brings us back to the original issue, and the original issue is not the federal government cutting positions, because it's NAV Canada cutting positions. That's one of the areas where people are quite confused.

The issue of user fees as opposed to a tax on passenger tickets is the central issue, and that does affect us as Yukoners quite considerably.

Yukoners already pay high passenger ticket prices and high air freight fees. Now, if NAV Canada is going to streamline air navigation services in Canada, then that's a good thing, but this initiative should not cause Yukoners to pay even more than we already do in air freight and passenger services.

Now, before November 1, 1996, air navigation services were provided by Transport Canada and funded mainly through the air transportation tax, or ATT, charged to airline passengers. It's important to note that NAV Canada, a not-for-profit private sector company, now provides these services and will receive a diminishing portion of its funding from government over a two-year transition period. That ends in November 1998 and at that point, the air transportation taxes are to be repealed as set in the Civil Air Navigation Services Commercialization Act.

It's expected that the new charges in increased oceanic and over-flight fees will total approximately $578 million during the first year and will recover 60 percent of NAV Canada's total cost. Transition payments from government will provide the remaining 40 percent.

Now, on November 1, 1998, the charges will recover 100 percent of the cost, and at that point, NAV Canada will operate independent of government funding.

NAV Canada, the country's national provider of civil air navigation services, is a non-share capital corporation with operations coast to coast, providing air traffic control, flight information, weather briefings, airport advisory services and electronic aids to navigation. That's important for us to know because not everybody in this House is a pilot.

The authority for the commercialization of air navigation services provided by the Minister of Transport include these key components: the transfer of air navigation services assets under the management control of the Ministry of Transport to NAV Canada, a corporation incorporated in part 2 of the Canada Corporation Act; the transfer of employees to NAV Canada with equivalent working conditions and benefits; and the continuation of current collective agreements and the granting of successive rates to bargaining agents - this speaks very much to the first amendment - t

he granting of certain powers to NAV Canada, as well as the imposition of certain operating obligations, the introduction of NAV Canada of user charges - and that's important - and the elimination of the air transportation tax two years after the transfer date; the provision of transition period payments to NAV Canada during the first two years equivalent to anticipate a revenues from the air transportation tax; the establishment of an economic regulatory framework in respect to the user charges based on the principle of self-regulation; the opportunity for users to appeal new or revised charges, other than the respective charges that may be approved by the Minister of Transport during the first two years, the establishment of a process to ensure public input to decisions by NAV Canada in respect of the introduction, increased termination or reduction of services and the closure of facilities, and the preservation of air navigation services to northern and remote communities, including a special process involving provincial and territorial governments for service reduction proposed by NAV Canada - that's also an important point for us - and provisions to ensure the continuing safety of air navigation services in Canada. Of course, air safety is the number-one issue.

It is important to note that the second last point about the preservation of air navigation services in northern and remote communities is the clause that affects Yukoners the most. The point is that there is a promise to continue air service. There is nothing in the promise about how much the provision of that service is going to cost Yukoners in remote locations. It's likely that the cost of freight service to some locations, like Old Crow, will be a far higher cost to people living in that village.

Under the old system of Transport Canada, there was a tax on air tickets for passengers only. The only extra money paid on air freight was GST. Under the new system with NAV Canada, there'll be a flat fee charged with every flight that takes off and lands, whether that plane is full of passengers or not. The fee is meant to offset the cost of providing navigation services for the flight.

Under the new system, the carrier would have to distribute the cost of the fee - or user fee - for navigation services over the passenger and freight load. Under the new system, for people in Old Crow, especially, the cost of freight will go up considerably, while passenger ticket prices stay relatively the same. Initially, the increases will be phased in over a number of years.

This is a real problem for the people of Old Crow, because they have no choice. There is no other way to get people or freight into Old Crow but by air. At least, there's no choice until we get that temporary winter road, maybe this year.

So, who gets the savings? For taxpayers, the creation of NAV Canada means that they will no longer be able to subsidize or pay $100 million to $200 million to subsidize the operation of the system each year. One example of spreading the cost around fairly would be the case of southern courier services. Currently, many southern courier services have fleets of aircraft to move their parcels or freight around the country. These couriers pay nothing for air navigation services, though they use the services extensively. Under the new user fees, this would change so that there would be a more equitable division of payment of service cost.

In the north there is more air cargo service than passenger service, so the distribution of the cost of user fees for navigation services will have a much greater impact.

Ultimately, we have to look at the cost of provision of navigation services. NAV Canada's expenses are only going to go up if they maintain their present operating structure. So, why should industry and consumers have to pick up their additional costs?

The first order of business should be for NAV Canada to cut their costs and pass those savings on to carriers and consumers. The problem with that is that NAV Canada is not competing with anyone, so there is no incentive whatsoever for them to cut back. There is no real reason for them to really look at why they are paying someone, for example, $80,000 a year instead of the same $40,000 a year that that person would be earning in a similar position in the airline industry.

To sum up then, in the short term, there will be very little effect on our tourism industry, because the cost of a passenger ticket will only go up marginally. Where there will be a far greater hardship will be in exploration and the cost of freight to isolated communities. Because the new user fees will be calculated on airmiles and facility costs, each departure or charter will cost more, particularly if that exploration company has to make the usual numerous trips out to a site with various different types of equipment for different types of exploration. That's a lot of flights and a lot of cargo.

In the past, there would have only been minimal charges for the freight plus the passengers. Now, under the new system, the cost of doing business will go up considerably.

For the people of Old Crow, the cost of living will go up again to compensate for the increased costs and different fee structure for commercial air carriers.

Now, our caucus had no trouble with supporting the original motion and the amendment to the amendment, which brings us back to the original motion. Indeed, the Government of Canada has already been responsive to the need to go back and enter into more discussions and to respond to the user concerns of remote and northern areas for the period of March 1 to November 1, 1998.

NAV Canada has deferred the application of proposed terminal service charges for community aerodrome radio station airports, or CARS. For the same time period, the proposed Education route charges will only apply to aircraft that either depart from or arrive at airports subject to the terminal subject charge. NAV Canada will consider continued exemption to these charges in their next round of consultations.

But, you know, we have to see what happens.

But, where do we go from here, then? Will the Government of Yukon be an active participant in the ongoing consultations? I hope that this government takes a very proactive approach and that this government will do everything reasonable to continue the northern exemption for terminal service charges in community aerodrome radio station airports.

Hon. Mr. Sloan: I hadn't intended to speak on this. However, the previous speaker's comments on the federal government and their non-involvement in this entire issue piqued my curiosity. And, of course, that always brings one to consider the whole situation with NAV Canada and the federal government and its fire-sale policies.

You see, Mr. Speaker, I know that the members in the Liberal caucus are fond of worshipping at the altar of the Auditor General. This piqued my curiosity and I went back and took a look at an article that appeared on Wednesday, October 8, 1997. The Auditor General, Denis Desautels, questioned the $1.5-billion sale to NAV Can that came about as the sale of this from Transport Canada.

Some Hon. Member: (Inaudible)

Hon. Mr. Sloan: That was the federal government, yes, and the Auditor General, in his wisdom, has concluded that this sale -

Some Hon. Member: (Inaudible)

Hon. Mr. Sloan: I believe this is 1997, so I would have to surmise that that would be the Liberal Party in power. It makes reference to Transport Minister David Collenette who, coincidentally, effected the sale, as "a very good deal." Well, Mr. Collenette, I've got a used 1989 Geo-Metro that you may be interested in, with a dot matrix printer, I've no doubt.

But I digress.

This piqued my interest because Mr. Desautels has said the difference between the sale price and the estimates of the government's own advisors amounts to, and get this, "a substantial indirect subsidy to the aviation industry at taxpayer expense."

It's an outrage.

Mr. Desautels also raised concerns about Transport Canada's contracting practices in hiring financial advisors for the deal. He concluded that the department wasn't monitoring the new monopoly to ensure that it complies with safety standards and regulations - I believe we were talking earlier about safety standards - and the Auditor General has concluded that the department, in this case Transport Canada, was not monitoring this new monopoly.

His comments were, "Until Transport Canada makes significant progress in implementing a performance-based regulatory regime, it will not be" - not be - "in the position to have the full assurance of NAV Canada's compliance with the safety regulations governing the air navigation system." This comes from the Auditor General, and the Auditor General is (a) questioning the sale, questioning the price for this, and (b) also questioning whether this sale is in the public interest in terms of safety regulations.

Now, I know that we became one of the first countries to privatize our airways, but this does raise some concerns. In negotiating the deal, Transport Canada had several estimates done on what the system was worth - not one, but several, and Mr. Desautels said that it did not follow up with any kind of independent analysis. In one estimate, financial advisors said the system was worth about $2.4 billion if it was sold as a going concern.

Well, later the Finance department - Mr. Martin's department - said that Transport should try to strike a deal equal to the book value of the system, which they estimated at $2.6 billion. Transport Canada, however, decided to deduct the interest cost of improvements to the system, such as modernizing radar - I'm not a pilot, but I think radar has something to do with safety in the air; I think it keeps us from meeting other aircraft on the same flight pattern, and minor points of that nature - and adjusted the book value to $1.9 billion. The Auditor General concluded that interest costs should not have been deducted, because NAV Canada can recover them through - ta daa - user fees. So, in the audit, Mr. Desautels concluded that not only was the book value too low, but the sale price should have been around what the system was worth as a going concern. The report added that the going concern estimate of $2.4 billion was - wait for this - conservative, and the system was probably worth much more.

Mr. Speaker, I was accused of not being an equal-opportunity employer by lambasting the Conservatives but, you know, I mean, today is a day for sort of spreading it out, and we really do try to do that. I would never bash the federal government. I would merely just point out that the Auditor General, whom we all see as that paragon of virtue and financial probity -

Some Hon. Member: (Inaudible)

Hon. Mr. Sloan: They often do.

My colleague, the Member for Faro, has reminded me that the Auditor General is often seen as the oracle in this House.

Good heavens, I've lost my spot. I'll have to go back to the beginning of my notes. O

h, no, thankfully ...

The net book value is not generally used to measure the value of an organization to be sold or transferred as a going concern. The government failed to exercise due regard to the economy in determining the value of the air navigation system. The report also said that such privatizations work better when they are done in stages. It argued that the air navigation system should have been turned into, first, a quasi-governmental agency, and later privatized. That would have given the department a better handle on what the system was worth.

The Auditor General also criticized the department for failing to report to the government the huge costs, up to $375 million, it was incurring to transfer the system and employees to NAV Canada. For example, it shelled out nearly $112 million in severance pay - at the highest rate typically paid to laid-off workers - even though all 6,300 employees moved with their jobs. It transferred $1.3 billion to cover the employees' pension liabilities, and this, in fact, was considered to be higher than what was needed.

The report itself accused Transport of bypassing the bidding process when it gave a $560,000 contract to a financial advisor that had won a smaller contract in the sale process. The report argued that the department was also ...

Where am I here? Good heavens, I've lost my place.

Some Hon. Member: (Inaudible)

Hon. Mr. Sloan: Yes, I may. It's a vision thing. By the way, my vision has kept me from flinging myself into the air. I've never felt that I should inflict myself upon the travelling public by becoming a pilot. However, I have, just by sake of argument, I've always trusted that there was a navigation system down there on the ground to guide me some place.

This report did indicate that the department, overall, had undercut the value of this property in a substantial manner and that represented a major loss to the taxpayers of Canada. Once again, I think it's no surprise that opposition MPs were fairly unanimous in their condemnation of the government for giving away almost $1 billion.

So, when I heard the Member for Riverdale South go on about the fact that this was NAV Canada, this was an independent group and not the government, that may be in a quick sense, but I think it's worthwhile realizing that what the government has tried to do by this privatization method is, one, it has done a serious disservice to the taxpayers of Canada, including taxpayers in the Yukon, and as well it has left some very, very serious concerns about the ability of Transport Canada, which after all does have a role in making sure that Canadians have the ability to fly safely and to travel safely. It really does question the role of the federal government, in this case Transport Canada, in monitoring and ensuring safe air conditions.

So, as I said, I hadn't meant to speak on this, but I was piqued, because I do know that my Liberal friends across the floor put such high stock - very high stock - in the role of the Auditor General in this. So, I thought they might be interested in that to find out how the Auditor General viewed this.

Just to follow up a little bit on this, Wayne Foy, who was the national chairman of Aircraft Operations Group Association, indicated that air safety employees were extremely upset about the federal government's action in this. Since we were talking about safety, Mr. Foy has noted that "Our members have seen the resources cut back over the past six years. Because of cutbacks, Transportation Safety Board accident investigators can't investigate crashes unless the death toll is deemed significant."

I personally think that's a fairly bad way of calculating what's deemed worthy.

Now, the Auditor General is telling us that the government undervalued NAV Canada by almost a billion dollars. A small portion - now this is the gentleman who's involved in aircraft operations, notes - a small portion of that money would have gone a long way to maintaining and improving air safety systems for Canadians. So, I think that it's not only the Auditor General in this case, but there's also some opinion within the industry that this was perhaps not the best deal that we could have received.

So, as I said earlier, I was not planning on debating this because I'm not a pilot. I don't have a great deal of familiarity with the technical aspect of air operations, but I think we are all consumers - as my friend, the Minister of Justice, has noted - and I think we all have a right to demand a level of service that is safe, and I would take a strong view - a strong condemnation - of anything which would undercut that safety level. As a matter of fact, here we have the Auditor General and some industry individuals who are noting this.

So, Mr. Speaker, in this regard, I would feel that we have several issues at play here: the safety issue; we also have the whole question of, basically, what the Auditor General has deemed to be a rather bad deal financially for Canadians and Yukoners.

As well, I just want to return again to the entire question of the workers. In an age of downsizing, and an age of rightsizing, and an age of rationalization of organizations, we very often forget that many of the people who are involved in these kinds of changes, these kinds of restructuring, are human beings. They're human beings who have families, they are human beings who are part of our community, they are human beings who have often invested substantial portions of their lives and their working careers in the service of the public.

Particularly, I would just note that people such as Transport Canada workers - people who work in the aviation industry - I think are people in whom, daily, six or a hundred or more individuals in this territory entrust their safety as they fly in and fly out, not to mention the numerous private aircraft.

So, I don't think we can undervalue that. I don't think we can merely say, well, that's just too bad. I think we have to realize that each of these individuals who departs from a public service, in this case perhaps NAV Canada's employment, represents a human loss - represents a loss to our community and certainly represents a substantial loss to the individuals, both financially and in real human terms. These are people who have trained for a job. In many cases, they're very highly trained. In many cases they performed roles that are somewhat Herculean.

The Member for Riverdale North has talked about the value of such individuals in talking him through a particular problem. I recall an incident a number of years ago in Watson Lake where a pilot became disoriented and, to escape bad weather, had climbed to a level at which he was suffering oxygen deprivation and became even further disoriented, and it was largely only by the efforts of the ground staff in Watson Lake that this person was brought into safety. I recall talking with some of the individuals at Transport Canada later on who spoke about this aircraft coming in, basically "on fumes", with ice bouncing off it as it landed.

So, we have to recognize the efforts of people in this regard and we have to recognize that people do have a value as well as the assets of a company.

Mr. Ostashek: Well, Mr. Speaker, I don't think I've ever heard anybody in this House get so far off the topic as the Member for Whitehorse West. I've never heard so much gobbledygook in all my life. I mean, the Member for Whitehorse West has shown that he clearly doesn't understand the fundamentals of business. He has clearly shown that when he says that the federal government ought to have gotten a lot more for the services.

Well, what the Member for Whitehorse West doesn't understand is that NAV Canada would have gotten it all back through user fees, and the problem facing Yukoners would be far greater today, Mr. Speaker, if NAV Canada would have paid $3 billion for the service rather than $1 billion.

The Member for Whitehorse West brings up a point - the Auditor General. I just listened to those members opposite today in Question Period ignoring the report of the Auditor General when it came to their operation. I heard the Government Leader do it again a few days ago in saying, "Well, so what that the Auditor General said it?" But when it suits their argument, they draw out the Auditor General.

Mr. Speaker, the fundamental basis of this motion was for safe air traffic into the Whitehorse area and not to impose user fees on Yukoners and northerners. That would have a detrimental impact on our economic well-being. That was the basis of the motion that was in front of us today. And I find it somewhat ironic that the members opposite would speak out so vocally and so passionately about the job losses at NAV Canada if they were to curtail some people. Yet they have basically sat on their hands when it comes to job creation in the Yukon in the time that they've been in power and said, "We can do absolutely nothing about it, Mr. Unemployed Yukoner. You're on your own as far as this government is concerned."

I find it very ironic that they would take somebody else to task with a record like they have. I heard the Member for Faro, the Minister of Economic Development, who will go down in the history of Yukon as the most unproductive Minister of Economic Development that this territory ever had when it comes to creating jobs for Yukoners, Mr. Speaker. They've done absolutely nothing.

Let me say something. We are just as concerned about those jobs as the members opposite are, but I want to say to the Member for Whitehorse West and to the Member for Ross River-Southern Lakes and to all of the government members, should we go back to the horse and buggy days? That created lots of employment for lots of people. Is that what they are advocating?

Some Hon. Member: (Inaudible)

Mr. Ostashek: Are they saying that we ought not to move ahead with technology, or are they saying that, even if we move ahead with technology and make the jobs easier - and, unfortunately, some people do get displaced - we ought to keep them on the payroll anyhow? Let them be very clear about what position they're taking, instead of standing on that high moral plane and saying, "Well, we can't afford to lose any jobs."

I feel as bad about those jobs as the members opposite do, but they ought to be doing something about creating jobs for Yukoners if they're going to stand on that high moral plane and condemn another level of government for not creating jobs, because they don't have a very good track record.

Mr. Speaker, we know that it's hard when people are displaced from their jobs. We know that there's a social price to pay. We also know that technology - not just over the last five years, Mr. Speaker, not just over the last decade, but over the last century, the last 100 years especially - has displaced a lot of workers.

We as a society have to deal with that. The answer to that problem, Mr. Speaker, is not to stick our heads in the sand and say we have to keep these people employed in the same position they were in, regardless of whether they're required or not. I don't believe that the human race evolved to where we are today by taking that type of approach to evolution and to technology.

What would be the use of creating technology to make our lives better if the price we had to pay was higher and higher and higher? At some point, it has to stop. It's our job as a society, our role as members of this Legislature, to help to retrain workers, to help to provide job opportunities in other fields if workers are displaced. The answer is not to say, "We keep them at any cost." That may be the mentality of the members opposite but it certainly isn't something that's going to go over very well in society.

And they may think they're doing their job as a government by taking that approach, but I just ask them to look at what's happened to other governments that took that approach and where they're at today, Mr. Speaker.

Mr. Speaker, I want to just respond for a few minutes to the Member for Whitehorse Centre, because I think what he pointed out was just further evidence of what I said. People do not like change. They are afraid of change. He went on to say that a pilot who was listening to the debate sent him some notes, or spoke to him on the phone, I don't know which, and said that his concern was about the reduction of the level of services.

Well, Mr. Speaker, that's what this motion is all about - that this House wants to be assured that there is no reduction in the level of service. That's what it's all about. We also want to be assured that the cost of that service is not going to be so high that it's going to have a negative impact on the development of the Yukon. It's not going to have a spinoff effect of causing more job losses in our society.

As for the pros and cons as to how many people should be there, I am not in a position to be able to make that assessment, and I believe the people who are working there are of the same opinion. They know that there are going to be some adjustments.

Whether they maintain the flight services, whether they maintain a flight advisory, or whether they maintain a tower, that's something for the experts to work out, not for us to give directions to on the floor of this House.

We can say we're concerned about the job losses because we are - we all are - but I get the impression from the speeches made by the members opposite that they're advocating that that's the first priority: no job losses. It doesn't matter what else happens - no job losses.

Well, that's fine if they think they can afford that luxury. Myself, as a taxpayer, I don't believe I can.

I want to say again, Mr. Speaker, for the record, I sympathize with people who lose their jobs in those situations, but I also say that it's our role as legislators to provide programs to retrain those people to get them back into the workforce in a position that is equal to what they had - for those unfortunate ones who are displaced when change comes along.

Mr. Speaker, as I said, we have watched technological change over the years, not only in the air industry, not only in air traffic control, but in all aspects of our livelihood, of our lives and how we live in this society today.

I'm sure that when a lot of us were teenagers - a few of us, my colleague from Riverside and myself at least - didn't expect we'd ever see 100 channels on TV that would be available with a flick of a switch. We didn't know anything of fax machines. We certainly, none of us in this Legislature 10 years ago, knew anything of the Internet. Technological change is happening all around us, and as a society we have to adjust to it.

It's not always easy, but I believe that our responsibility, as members of this Legislature, is to be sure that our constituents are safe when they travel - that should be our first and foremost concern - and that the cost of being able to fly into the Yukon does not go up dramatically because of user-fee charges to our airports and our navigation systems in this country - no more so than the cost of driving on our highways should be so exorbitant that we cannot afford to drive cars.

And for us to stand in this House to debate the issue of whether the federal government should or should not have disposed of NAV Canada is not the issue in front of us today. It's already been done, and there's nothing that we can debate on the floor of this Legislature today that's going to change that. But what we can do is provide some direction as to how we feel on behalf of our constituents about the level of safety that we're going to have in the operations now that they've been taken over by - what do they call it? It's not really the private sector. It's an non-share, capital corporation, which owns and operates Canada's civil air navigation services (ANS). NAV Canada is a private-sector, non-share, capital corporation.

So, Mr. Speaker, we have a role to play in defining the directions of NAV Canada, as do the users, as do the employees of NAV Canada, and we ought to be concentrating on what's important here, and that's that we don't have a compromised level of service that is going to affect safety.

It's going to cost us more money than what we can afford. That's the issue in front of us and that's why we brought forward the motion. That's why we brought forward the amendment to the amendment.

Mr. Speaker, when I stood up and spoke to the amendment that was proposed by the Member for Ross River-Southern Lakes, I asked him specifically to provide to me some evidence that safety was going to be compromised by the reduction of staff, if in fact that's what happens. We don't even know that that's going to happen yet. They said there's a good likelihood that that'll happen.

Some Hon. Member: (Inaudible)

Mr. Ostashek: I'm not saying it is not or it will. I'm just saying that I'm not prepared to make that judgment at this time. What I am saying is that the Member for Ross River-Southern Lakes did not provide one bit of evidence to back up his argument or his position. He just stood up and said, "Well, if there are job loss, I'm against it". Doesn't matter if it's twice as safe as it was before - "If there are job losses, I'm against it". That's what he said.

Mr. Speaker, I don't think that's a very responsible approach to be taking to the issue in front of this House today, and I think we're elected to act in a responsible manner. That would be like me saying to the minister responsible for highways, "If you only have half the number of highways to maintain, you should still not reduce your staff; you should keep the same amount of staff on, the same number of catskinners, the same number of grader operators, the same number of truck drivers, the same number of mechanics; you should keep that entire fleet of equipment, and you should not reduce your cost one bit." That would be, in my opinion, very irresponsible. I think that's what the amendment that was proposed by the Member for Ross River-Southern Lakes was when he took the position that he's going to dictate, before the studies are complete, before all of the stakeholders have been heard from, before we even know what level of reduction is going to be that, absolutely not, we maintain these people at any cost.

That appeared to be his only concern when he spoke to the amendment that was proposed by the Member for Klondike. He couldn't support it. If it meant job losses, he couldn't support it.

Well, I think the Member for Ross River-Southern Lakes ought to get into the real world. We need to streamline services at every level of service that we provide to the public. The public is demanding it.

Yes, when it means the displacement of workers, they are upset by it. Nobody wants to lose their job. Nobody wants to have to go through a retraining for another job. I wouldn't like that any more than the workers that are displaced. But I believe that all of us, as Canadians, even the people who are displaced, in their heart of hearts, realize that things cannot remain the same, that we cannot turn into a stagnant society, that we cannot evolve to do things better, because that would be a great loss to all of us. We would not have the comfortable lifestyle we have today.

That's why I ask the Member for Whitehorse West, does he want us to go back to the days before the combustion engine when there was more work than there were people to fill the jobs? Does he believe in his heart that he would be satisfied with that type of lifestyle? I think not. I think not.

So, therefore, I think it's a red herring to come out and say that we can't support this because of the possibility that there may be some jobs lost.

Again, as a pilot in this territory for many, many years - and I flew sometimes in the busiest times in the Yukon, and that certainly isn't today, by a long way. There's not nearly the volume of traffic that there was in the 1980s. There was far more traffic then.

Speaker: The member has two minutes.

Mr. Ostashek: Thank you, Mr. Speaker.

Mr. Speaker, I just want to say for the members opposite, for those who have not had the experience of flying in small aircraft, private or commercial, I've made many, many trips, sometimes three or four in a day, to Whitehorse, through every season, through every day of the week, and

I was thinking when I was listening to debate today that when I called in when I hit the control zone and got clearance to land at the airport, I do not ever recall being more than number four in the circuit.

And that was the worst. Most of the time, 90 percent of the time, 95 percent of the time, I was cleared straight in, whether it was to Schwatka Lake, which I believe one of the members raised as another bit of evidence that we need a control tower, or whether it was to the airport. Ninety to 95 percent of the time we got straight-in clearance. And it didn't matter what time of the day it was. It could happen any time of the day.

So, the argument that's been put forward by the members on the government benches of the requirement of the high level of staffing that we need to provide this service is a red herring. There's no justification for it and, Mr. Speaker, I, for one, believe that we can have good navigation services in here, we can have good advisories, and there can be some cost-savings in the system, and as much as I hate to see job losses, and it's unfortunate if there are, none of us in this House today know that there's going to be or how many they are.

Thank you, Mr. Speaker.

Mr. Livingston: On the subamendment, Mr. Speaker, I can't support the subamendment and I can only imagine, I guess I can only assume, that the member who has just spoken, the leader of the official opposition, is somewhat upset that we haven't followed his tax-and-spend policies of the previous government over the last four years, and that we are approaching government in a much more thoughtful and deliberate and responsible manner in terms of our spending patterns, in terms of paying as we go and taking care of business in a responsible kind of manner.

I also have to assume, Mr. Speaker, that members opposite are hiding behind this series of subamendments and maybe even the framing of the original motion. They don't really want to get into defending this particular level of service for Yukoners. Mr. Speaker, this is really a charade or a parade of words that they're hiding behind in order not to address this fundamental issue.

This issue, Mr. Speaker, is about safety. It's about public safety. It's about a level of service to Yukoners, and it's about jobs. The argument somehow, Mr. Speaker, that we can separate the workers who work at NAV Canada - the flight service station - the service that's provided there and the public safety, that somehow we can separate those three issues into three nice, discreet little bundles that we can set aside and talk about each of them at separate times, really does not hold water.

You know, Mr. Speaker, we had a motion here earlier, I believe, about the weather station. We wanted to maintain the weather service in the Yukon. We wanted to have people with real eyes that could talk to real people here about the stories as people came in, the low clouds in the Braeburn area when they came through and stopped in and had cinnamon buns, or whatever it happened to be. We know that those real eyes in the station are what makes a difference, and that's why we heard the members in this House supporting the maintenance of weather services in the Yukon.

Some Hon. Member: (Inaudible)

Mr. Livingston: Except for the Liberals.

So, we've got one party that didn't support it, but now we see the other opposition party saying, "Well, you know, it'd be kind of nice to keep some flight services here in the Yukon, but maybe we can find some fancy machines out there that will do the job." Well, Mr. Speaker, I don't think that Yukoners, I don't think that pilots, have faith that that's going to deliver everything that's needed.

Monday's newspaper headline - Monday's Whitehorse Star - says "Absence of control tower blamed for fatal collision." This is a story that is reported from Mascouche, Quebec, and I quote. "With no control tower to guide them, four Quebec men died Sunday when their two Cessna aircraft collided near the province's airport."

This is a busy airport, Mr. Speaker. It goes on later in the article to say that Transport Canada set up an air traffic control tower temporarily a few years ago to monitor traffic and to figure out how busy the airport was. It was a mobile with traffic controllers inside and an antenna on top.

But you know what, Mr. Speaker? That program was ended in 1996. They didn't need it. They determined that they didn't need the service there. Meanwhile, we had four people die on Sunday in Quebec because they pulled the aircraft controllers out of this particular community, and this is the price that's been paid.

Mr. Speaker, I don't think we want to wait for that kind of a tragedy to occur for us to reverse a decision or to try to put back in place an appropriate and adequate air traffic control system.

I think it's worthwhile, Mr. Speaker, to turn back the clock a couple of years and look at some of the background to this decision to privatize NAV Canada. Now, the members opposite have said, "Big deal. It's no big deal. We simply have one more service that's been sent out to the private sector."

It's interesting to see the optimism going in this. I've got a press release dated December, 8, 1995, from the NAV Canada Bargaining Agents News Release, as it's called, and there's just incredible optimism expressed. Gary Wilson, president of the Canadian Association of Professional Radio Operators, says he's optimistic that the deal has a potential to increase services to the Canadian and international aviation community. The CAPRO vice-president says that NAV Canada has the vision to take us to new heights in diversified services, the world's leader in aviation safety services. Ron Richardson, the national chairman of the Aircraft Operations Group Association expressed his admiration and gratitude for the change in attitude that took place and notes that the public will enjoy a less expensive yet safer aviation service in Canada.

So, this is the background to the privatization of NAV Canada.

Let's just examine this for a moment, this notion of privatization. Now, I have no problem, Mr. Speaker, that some services are delivered privately, some services are delivered publicly. I think that what our government wants to do is to do what makes sense, to do what works. That's the real test in terms of how we would deliver services or the kind of economy and the kind of service level, the kinds of communities, that we would support.

We know, though, that there's been a real privatization agenda. We know that there's been an agenda to privatize navigation in airports. We know that there's been an agenda to privatize hospitals. We only have to look at Alberta and see what the Conservative government in Alberta has attempted to do over the last couple of years. Indeed, we know of examples where even highways are privatized, and we see, not in Canada so much, but south of the border where, every couple of miles, you're throwing money into the tollgate because it's a private road.

Well, I would contend, Mr. Speaker, that governments - particularly governments in Canada - recognize that there is something known as the public good, and that one of the reasons that we have governments is that they have a role to play there. As I said earlier, not to do everything. We don't expect governments to do everything; we wouldn't want them to do everything, but they do have a role to play.

Particularly in the Yukon and across Canada,

we've seen for the last century and a half, governments of all political stripes being recognized, recognized with our large geography - second largest country in the world - our smaller population - certainly in terms of people per square kilometre - that transportation and communications have been fundamental backbones for the economy and the lifestyle of Canadian people. These have been a matter of public debate, a matter of public policy and indeed, Mr. Speaker, a matter of public investment.

Why, it was the Conservative government of Sir John A. Macdonald back in 1864, prior to Canada actually becoming a nation, and through until 1867 and so on. His National Policy was built on having a railroad from sea to sea. Now, he forgot about the other sea, but the spirit was there. He knew that that transportation bridge was a nation builder, and he was prepared, as a matter of public policy, to support that, because he knew the impact that that would have, that that in a sense was one of those strings, one of those critical strings, that would tie the country together.

This notion of the public good, that government has a role to play in ensuring that important public matters are proceeded on and that work is proceeded on and that accomplishments are achieved, is not uniquely Canadian. We look, for example, back at pre-industrial Britain, where every community had a commons. A commons did not belong to this family or that family. Rather, it was a common area that was there for a common purpose. We see it in many of the First Nations - some of the First Nations at least in North America - that strong tradition of areas held in common for the common good. We know that there are members on the floor of this House that could speak much more eloquently about that than could I.

I guess what I'm getting at, Mr. Speaker, is that the public good is something that we expect our governments to stand up for and NAV Can, when we turn our eyes back to the role of Navigation Canada, we have a transportation system - highways, airports and so on - that have been basically there for the public good. They are there and available for public use. When we turn our eyes, then, to take a look at the costs that are involved, the impact, for example, of the user fees on both the travelling public and the airline businesses and the private aircraft that would travel from point to point within the Yukon, we can see that adding a fee every time that they used the airport services would add some additional costs.

We also know, Mr. Speaker, that the addition of new administrative structures - now we've got to have someone there to collect the fee and to keep account of it and report back to, I guess in this case, the board of directors as to how much has been collected and so on. There's a whole new kind of structure being established here.

This is one of the hidden costs, in fact, Mr. Speaker - privatization - one of the hidden costs where now we need to set up some new structures to keep account of and to have them report - in some cases, a double-billing kind of structure.

I'm sure that members opposite will want to simply put this down to the left-leaning member over on the government side of the House ranting and raving about privatization. I'll tell you, Mr. Speaker, that in the NBAA Digest, which is a monthly publication covering business aviation news and issues, the president, John W. Olcott, in a short article called "Look Homeward, Planners", advises Canadians that they're maybe not doing the right thing by following the American example of trying to privatize navigation services at airports. He points out, for example, that the amount of Canadian traffic is five percent what it is in the United States. Of course it's one of the reasons, if we look back at the policies of the Conservative Prime Minister in 19th century Canada, why he was prepared to throw in public dollars, because he recognized that, for Canada to be in a competitive position, for it to develop and extend itself from sea to sea, that type of public support was, in fact, necessary.

In Olcott's remarks in the NBAA Digest, he notes, "Full financial independence will occur after a two-year transition period, during which the government will subsidize the not-for-profit corporation' to the tune of about $1.44 billion Canadian."

He suggests that "NAV Canada may have considerable difficulty realizing the 20-percent reduction in navigation costs anticipated when the notion of a private 100 percent user-funded air navigation system was conceived."

It does not express very much optimism, Mr. Speaker, that this is either going to provide for more safe airways or that, in fact, financially, from a business perspective, this is even a do-able operation.

I think that an examination of some of the numbers is rather revealing. On the Canada news wire report from October 15, NAV Canada announces year-end financial results. Now, here is what they had to say here, "For the 10-month period, since the acquisition of the Canadian civil air navigation system from the Government of Canada on October 31, 1996, NAV Canada's revenues were $776 million. Operating expenses totaled $584 million. Interest and depreciation totalled $121 million and there is a restructuring charge of $57 million." If you can do your math quick, you will realize that there is nothing left here. Well, that's fine. Businesses sometimes make a little and sometimes they are on the line, and sometimes they don't make a lot of money. But, here's the interesting part, Mr. Speaker, fourth quarter revenue was $242 million and it was made up of approximately $175 million of transition period payments from the Government of Canada. The user charges were - excuse me, Mr. Speaker - a measly $67 million. Now, $67 million is not a measly sum of dollars. But, in a total revenue of $240 million, it does not add up to an awful lot.

Most of the revenue, Mr. Speaker, was subsidies from the Government of Canada.

Some Hon. Member: (Inaudible)

Mr. Livingston: My colleagues on my left are remarking about the Yukon Party government being the one that was raising taxes, and that's in response, of course, to the calls from across the House calling for the kind of responsible government that they've seen, of course, from this government.

Mr. Speaker, privatization is not the be-all and the end-all. We've seen the impact here with NAV Canada. It's having to pick up its shortfall. It's having to cut services. It's having to jeopardize the public safety. It's having to lay off workers and replace them with machines. That's not very impressive.

And on the commons, where they had the commons decide in each community that community members could use as they needed, we've seen the erosion of that notion of that as well. We had Maggie Thatcher - Prime Minister Thatcher during the 1980s - who cut and cut and cut away at public services, and even, Mr. Speaker, to the point of privatizing the water and sewer services.

These are basic public services that need to be available for our communities, our cities in particular, to function effectively, and the notion was that, somehow, privatizing them was going to do that job. Well, we know what the impact has been, Mr. Speaker. The impact has been to lower the level of services. The impact has been to jeopardize, in many cases, public safety, and to do it, oftentimes, for more money. This is no panacea, the notion of privatization.

It's interesting to note, Mr. Speaker, the last 10 years - I guess coincident with Prime Minister Thatcher of Britain and President Reagan in the United States - we saw a similar kind of mood occurring in business. We saw particularly the megacorporations - those huge corporations - moving through incredible downsizing kinds of stages. Of course, when the competition would downsize and cut 20 percent or 25 percent of the workforce, the company down the street that also sold computers or did banking would have to cut their 25 percent, as well.

What has the impact been? Well, the impact has been a loss in vision. We find that some of those large companies simply crumbled under their own weight because they no longer had a sense of where they wanted to go or where they wanted to get to.

They simply lost. They could do no more than keep ahead of the day-to-day rat race. They had lost their sense of where they needed to get to.

So, Mr. Speaker, sometimes the cutting will seem like an easy kind of a solution - we'll cut, cut, cut. But, we can't forget that it's workers; it's real lives; it's real people that we're putting out of those positions. We can't forget, Mr. Speaker, that we expect a level of service in our schools, in our airports, on our highways, and it's all right for that to be a public effort when that's the right way to do the job.

Speaker: Member for Whitehorse West - Whitehorse Centre.

Mr. Hardy: Yes, it is Centre. I prefer Centre to West right now.

Well, actually, you know, you bring up Yeltsin and you bring up Russia. Of course, when you bring up Russia, you bring up capitalism run amok, destroying the economy, destroying people, everything. All the private enterprise or public services are now being wiped out, given to the private. Private is rampant with crime, so the Mafia's in there deep.

But, it was interesting the other day, though. The last time I spoke, I spoke about jobs.

The last time I spoke about jobs, the Member for Klondike got up and said something like, "It sounds just like communism." I described a world where people actually have jobs; he thought that would sound like communism. I described a world where people worked for the better social order. He said that sounded like communism. Well, I have to thank the member opposite, I really do, because in the end, the member opposite has allowed me to come out of my closet. I don't have to hide any more. I don't have to hide, Mr. Speaker. I am now officially a member of the hammer and sickle. So I really do thank the member opposite for allowing me to come -

Some Hon. Member: Point of order, Mr. Speaker.

Point of order

Speaker: Point of order has been called.

Mr. Phillips: On the point of order, Mr. Speaker, the member didn't have to get up and tell us he was a member of the hammer and sickle club. We all knew that.

Mr. Speaker, the motion is about the airports, and the member should try and get back to the topic. I know he would like to be with his friends in Russia or Cuba or wherever else the hammer and sickle club originates from, but the topic is at hand. We get one day a week to discuss these kinds of topics, and the member should try and stick to the topic.

Speaker's ruling

Speaker: Would the member please get back to the motion and continue his speech.

Mr. Hardy: I really do appreciate the guidance I'm getting from the Speaker and also I do appreciate the guidance I got from the capitalist side of the world to take off my hat and tone down my rhetoric. We often hear from the other side and it just gets me going, you know. It was really nice to come out of my closet.

But anyway, getting back to NAV Canada, which I believe ties into this, the Member for Lake Laberge spoke about the privatization movement, the federal Liberals downloading, offloading, privatizing. Now they're calling it different things and they're trying to confuse the people out there. What it comes right down to is a reduction in services throughout Canada.

The Member for Porter Creek North, the leader of the official opposition said, "Accept it." Well, we should accept it; we can't do anything about technological change - accept it. So, we should accept the car that's racing down the road at 100 miles an hour. We should accept the fact that if we stay in the middle of the street, we're going to get hit. We should not maybe stop the car and get out of the way and get some control over it. He just says, "Accept it" Let it run right over us. Let it wipe out huge sectors of employment.

That's what NAV Canada is partly about. It's about a reduction in services, and it's about a reduction in employment. The members opposite can say whatever they want, but history in the last 10 years in Canada has shown very clearly the direction we're going - 45,000 people laid off in the private sector in Ontario, 30,000 people laid off from the federal government, 20,000 laid off here, plants closing all over the place, and downloading.

I'll give you the example of how wonderful this movement is. Everybody probably knows the company, a Canadian-made company, a tremendous success story - Bauer-made hockey skates. Most kids that ever played hockey or figure skated years ago wore Bauer skates. They were all connected to it. They got bought out. Now, they got bought out by a company named Nike. This is one of these ideal companies, one of these companies that believes in free trade, that believes in child labour. They bought Bauer. When they bought it, they had to get permission from a department with the federal government, the Liberals, and at the time, they had to agree that they would invest in the plant. Now, this plant was something like 20 or 30 years old, and paid really good wages. Employees had been there for 15 or 20 years - very solid with 450 employees, I believe.

Now, what happened? They agreed to these terms. They got a loan. Nike got a loan, I believe it was, from the federal government to buy this. This is a multi-billion dollar company getting a loan to buy a home-grown Canadian success story. Within two years, they had closed that plant. They have shipped out all the technology that we had up here, all the knowledge of how to make skates and they shipped it across.

Mr. Phillips: Point of order, Mr. Speaker.

Point of order

Speaker: Point of order has been called.

Mr. Phillips: Mr. Speaker, this is not hockey night in the Legislature. We are talking about NAV Canada. Let's get back to NAV Canada, please.

Hon. Mr. Harding: My colleague must be free to use examples in the debate to substantiate his arguments regarding NAV Canada. What he's simply doing is explaining, by way of using an example to illustrate the effects of decisions by the federal government to privatize, and how those privatization decisions have equated to reductions in levels of services and reductions in levels of jobs.

Therefore, Mr. Speaker, I would argue that the member must be free in the debate to exercise the use of examples and illustrations to further the points he's making with regard to the motion on NAV Canada and to explain his views on the privatization of that particular service to Canadians.

Mr. Phillips: On the point of order, Mr. Speaker, the only similarity is they both start with N's - NAV Canada and Nike - that's the only similarity.

Speaker's ruling

Speaker: Would the member get back to the motion and speak to the motion, please.

Mr. Hardy: I will speak to the motion, Mr. Speaker, and once again I am really thankful for the guidance that I'm receiving from the opposite side. I might wander off and talk about some other plant that's been shut down, but I'll stay with this downloading, this shifting over.

It's true that NAV Canada is not for profit at this moment, but who says it's not going to be not for profit in five years? What control do we have over NAV Canada? That's the question I ask. What control do we have over the changes NAV Canada wants to bring in? With the federal government, when they are in control of it, we do have some input, we do have a way, a mechanism, to ensure that we have influence upon the decisions that affect the north.

But, with NAV Canada, what they have done is -

Speaker: Order please. The time being 5:30, the Speaker will leave the Chair until 7:30 p.m.

Debate on Motion No. 70 accordingly adjourned

Recess

Speaker: I will now call the House to order.

Hon. Mr. Harding: I move that the Speaker now leave the Chair and the House resolve into Committee of the Whole.

Speaker: It has been moved by the government House leader that the House do now resolve into Committee of the Whole.

Motion agreed to

Speaker leaves the Chair

COMMITTEE OF THE WHOLE

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

Committee is dealing with Bill No. 8, Second Appropriation Act, 1997-98. We are on the Department of Economic Development, O&M expenditures, line item mines and resource development.

Bill No. 8 - Second Appropriation Act, 1997-98 - continued

Department of Economic Development - continued

On Operation and Maintenance Expenditures - continued

On Mines and Resource Development - continued

Hon. Mr. Harding: Just very briefly, a couple of questions we were asking about financial statements from Anvil Range today - when they were being provided. I just want to report to the members that the August financial statement was provided at the end of September by Anvil to the government and they are required to provide a September financial statement shortly.

I checked into the issue about the way the receivable is recorded, both the interest and the loan itself, and I've been assured by the accountants in my department that it's the general way we show those expenditures and those types of entries.

Yesterday, I was asleep at the wheel, as were the members opposite, because they cleared the line on administration. So, let me just run through that line again for the members opposite.

On Administration - revisited

The amount is $24,000, and it breaks down this way: a reduction of $32,000 for a vacancy in the systems administrator position; $7,000 extra increase for extra hours for half-time records clerk; $4,000 for student library assistant; $25,000 consultant contracts to cover systems duties; a $16,000 contract for position descriptions for devolved positions from DIAND, and $4,000 for miscellaneous expenditures, for $24,000.

On Mines and Resource Development - revisited

I was on the second line last night. I'll repeat the breakdown: a loan to Anvil Range of $1.5 million; a reduction of $56,000; an increase of $23,000 for senior mineral development advisor; a vacancy for administrative assistant of $11,000 reduction; oil and gas recruitment, reductions - they were delayed - of $51,000; FIDO recruitment delayed, for $38,000; energy management analyst vacancy for a $32,000 reduction; increased contract services in oil and gas of $20,000; relocation costs for utility analyst for a $12,000 increase; contribution to oil and gas working group paid in 1996-97, for a reduction of $50,000; forestry industry development officer, outside ad interview and relocation, $32,000; increase Anvil Range, due diligence contract, $5,000 increase; other miscellaneous expenditures, $2,000 increase.

I'll read out strategic management. The line items are a reduction of $13,000; vacancy in the secretariat officer is a reduction, $21,000; northern ministers conference I attended in Prince George with officials and helped organize was $10,000, and miscellaneous deductions of $2,000 for a total net deduction of $13,000.

Mr. Ostashek: I thank the minister for the explanation of those line items.

I don't have any questions on them. I have one question I missed in general debate, and I will ask the minister if he would be generous enough to answer it;if not, I will pursue it in Question Period. And, that was, has there been any change to the terms of reference for the chair of Yukon Council on the Economy and the Environment?

Hon. Mr. Harding: Terms of reference?

Mr. Ostashek: I'll be very clear with the minister. A concern was raised to me that somebody reported to me that the chair position had been made a full-time position. Is there any truth in that?

Hon. Mr. Harding: Not to my knowledge.

Mr. Cable: Mines and resource development - I think that's the line we're on, isn't it?

The $50,000 contribution to the oil and gas working group paid in 1996-97, I wonder if the minister would indicate two things: what was the $50,000 for, and why was it not recorded in the previous year?

Hon. Mr. Harding: It was for the development of a common regime for participation of Yukon First Nations governments, and I believe it was recorded last year. This is a reduction of $50,000, so it was a reduction in the line item from what was initially budgeted in the main estimates. I guess the reason for that is that it was paid out sooner than anticipated.

Mines and Resource Development in the amount of $1,356,000 agreed to

On Strategic Management

Strategic Management in the amount of an underexpenditure of $13,000 agreed to

On Industry, Trade and Investment

Hon. Mr. Harding: There was an increase of $43,000 here for export trade facilitator; marketing and promotion officer, net vacancies; secretarial marketing coordinator and miscellaneous personnel reductions. That's the increase of $43,000 and additional contracts for export and investment initiatives for $25,000, for a total of $68,000.

Mr. Ostashek: Mr. Chair, can the minister tell us if the position of the facilitator for investment and trade is a full-time position and a permanent position within the department now?

Hon. Mr. Harding: It's full-time, but term for two years.

Industry, Trade and Investment in the amount of $68,000 agreed to

Operation and Maintenance Expenditures in the amount of $1,435,000 agreed to

On Capital Expenditures

On Administration

On Office Furniture, Equipment, Systems and Space

Office Furniture, Equipment, Systems and Space in the amount of $10,000 agreed to

On Industry, Trade and Investment

On Economic Development Agreement

Hon. Mr. Harding: This is where I stumbled when I discovered that I was on the wrong page last night, and so did the members opposite.

This is relating to the five-year EDA, although the five-year economic development agreement with Canada expired March 31, 1996. Two subagreements in tourism and small business support included provisions to provide funding to complete carryover projects before the expiry date of the agreement, 70-percent recoverable from Canada. The full carryover amount was not required to complete the projects.

Economic Development Agreement in the amount of an underexpenditure of $208,000 agreed to

On Centennial Anniversaries Program

Hon. Mr. Harding: This breaks down this way: $1,567,000 million for revoted projects approved last year; a reduction of $6,000 for Whitehorse CAP project delayed, which was the subject of much debate yesterday; $100,000 for the Ross River project, which was advanced; a $5,000 reduction for Burwash Landing project planning budget decommitted; and $51,000 for a contingency which was also decommitted - that's a reduction - for a total of $1,011,000.

Centennial Anniversaries Program in the amount of $1,011,000 agreed to

On Community Projects Initiative

Hon. Mr. Harding: Again, we debated this line item yesterday: $469,000 for revoted projects approved last year.

Community Projects Initiative in the amount of $469,000 agreed to

On Community Development Fund

Hon. Mr. Harding: Again, funding reduced to purchase Taylor House.

And I'll read the next line item as well, for $403,000. That includes the purchase price of $400,000 and share property taxes for $3,000.

Community Development Fund in the amount of an underexpenditure of $400,000 agreed to

On Taylor House Purchase

Taylor House Purchase in the amount of $403,000 agreed to

On InfoPoint 2000

Hon. Mr. Harding: This includes the matter we also discussed yesterday regarding the FM transmitters.

InfoPoint 2000 in the amount of $150,000 agreed to

Chair: Are there any questions on the recoveries?

Capital Expenditures for the Department of Economic Development in the amount of $1,435,000 agreed to

Department of Economic Development agreed to

Department of Health and Social Services

Hon. Mr. Sloan: Oh, it's been so long. I thought they had forgotten about me.

Mr. Chair, I'm pleased to introduce the first supplementary budget for the Department of Health and Social Services for 1997-98. As you'll notice, the department is projecting a need for an increased O&M expenditure of $5,640,000 and an increase in capital expenditures of $4,830,000. These increases are accompanied by an increase in O&M recoveries of $1,050,000 and an increase in capital recoveries of $3,319,000.

Mr. Chair, these increases are largely attributable to four program areas. In the area of health services, we are seeking increases related to our contribution to Yukon Housing Corporation and an increase in our insured health services.

In the area of social services, we are projecting an increase in child care subsidies and our social assistance program in both Whitehorse and the regions.

Before I explain some of the details related to these projected expenses, I would like to draw your attention to some related facts.

First, the population of the Yukon has grown. In 1994, the population of the Yukon was reported at 31,349 people. By the end of 1996, that population had grown by eight percent to 33,911. If we look at a population projection for the territory to the end of 1997-98, we are looking at an additional two-percent increase. This is a 10-percent increase in only three years, and that increase is showing some major effects on our statutory programs.

In areas of health insurance, hospital utilization, child care and social assistance, we are experiencing a steady increase in volume, which is, in part, attributable to the general population increases.

It is not enough to simply look at population numbers, however. We must also take a look at the demographics of the populations that are accessing these services.

If we look at the child care program, for example, we observe a steady increase in the number of children in the territory. Between 1995 and 1997, the school-age population increased by 18.5 percent, and there was a corresponding increase in the number of school-age children approved for child care subsidy during this period. The pre-school population has remained almost constant since 1994, however.

If we look at the Pharmacare program, we are projecting an increase of seven percent this year in the number of eligible clients submitting claims. This represents an increase in the aging population in the Yukon. Since 1990, there has been a 37-percent increase in Yukon citizens aged 65 or older.

This age category has grown from 3.7 percent of the total population to 4.5 percent of the total population and is expected to increase. In the next five years, the steepest increase in absolute terms is expected in the 70-75 age group. This age group is also a large consumer of many of our health services. There is also a number of other dynamics that figure into the increasing costs and volumes of these essential program areas, and I would now like to briefly explain some of these highlights.

Contributions to the Yukon Hospital Corporation for the operation of Whitehorse General Hospital will increase by $979,000, to a total of $16,379,000 for this fiscal year. This increase is the direct result of a recent facility review and reflects a 2.36-percent increase over actual operating funding provided in 1996-97 for an equivalent range of service.

The hospital, however, is also predicting an increase in volume in utilization. Patient admissions are predicted to increase by six percent. In-patient days are predicted to increase by five percent and emergency room visits are expected to increase by four percent. I should remind members that Yukoners will benefit from the federal government's commitment to cancel planned reductions to the Canada health and social transfer, and these funds will go to support this increase in the hospital budget this year.

With respect to increased health services, a combination of volume and price are expected to increase expenditures related to physician fees, out-of-territory hospital claims, out-of-territory medical travel, chronic disease, Pharmacare and extended health programs.

In 1997-98, we are expecting physician costs to increase by $663,000. This is made up of a $171,000 increase in out-of-territory physicians, an increase of $149,000 to reflect the recent contract agreement with the YMA and an increase in in-territory physician costs of $343,000, as well as the utilization of physican services, both in and out of the territory.

We are also experiencing a cost-for-service increase. For example, the cost for service for out-of-territory physicians has risen by 13.5 percent, reflecting not only rising prices, which we have no control over, but also the higher number of more expensive services. In the territory we are experiencing a one-percent increase in the number of health care registrants, and a 1.2-percent increase is expected in the number of services.

Rising average cost per service indicates trends in the territory toward providing more higher cost services. At this point,we are predicting out-of-territory hospital cost to increase by $952,000 in 1997-98. This large increase was based on a significant trend we noticed in the first few months of the fiscal year, related to the expense of in-patient services.

Recent information indicates that this early rising trend may be flattening, and we are hopeful that if it continues, this estimate may be able to be reduced at a later date.

With respect to out-of-town patient services, we have also noticed an increasing trend. In 1995-96, out-patient visits outside have increased by 650 visits, or 14.5 percent per year. This year we are expecting out-patient services to cost approximately $252,000 more while in-patient services are expected to cost an additional $700,000.

Medical travel costs are also subject to volume and price increases that are expected to increase expenditures for this program by about $150,000.

This year we are anticipating an increase of about 14 percent of in-patients requiring medical travel, in addition to the fact that fares have increased 15 percent over the last two years.

Chronic disease, Pharmacare, extended health benefits are each expected to increase by the same amount for a total increase of $345,000.

In addition to an increase in the number of eligible clients submitting claims, the average prescription costs are also expected to rise by about eight percent.

This supplemental budget also reflects an increase of about $283,000 for the transfer to the Yukon of the TB program. This increase is offset by the corresponding increase of recoveries from the federal government.

There are some offsetting decreases and adjustments to health services, which I'll draw your attention to during line by line.

I'd now like to turn attention to the area of child care and explain briefly the dynamics we believe that are driving costs in this area. In addition to the increasing child population in the Yukon mentioned previously, we must recognize that the demand for child care subsidy is also fueled by the high labour force participation rate of women in the Yukon. As of October 1996, the labour force participation for women in the Yukon was 80 percent, as opposed to 58 percent in the rest of Canada. This means that not only do more women seek the subsidy here in the Yukon, but also there are fewer alternative child care services, such as family, friends, neighbours and relatives.

Now let's look at the nature of families accessing subsidies in our subsidy program. In April of this year, there 395 families accessing the subsidy program. Over 80 percent of these families were single-parent families and 75 percent of these families using the subsidy program had no parent contribution and therefore, annual incomes below $23,000 in Whitehorse and $31,000 in the communities. Most of these parents also pay a surcharge for their services above what they receive from the subsidy program. These dynamics have resulted in increased demands for child care spaces and an accompanying increased demands for the subsidy.

Day care spaces have been increasing such that we are predicting over 1,300 pre-school spaces by the end of this year in the Yukon.

Expansion of child care spaces is especially noteworthy with respect to First Nations. With the assistance of the federal First Nation child care initiative, 49 new spaces were created in three child care centres in 1996-97 in the Yukon. These volume increases have resulted in a 13-percent increase in the average child care subsidies per month each year for the couple of years. This year we are requesting $180,000 to respond to the volume increase.

With respect to the social assistance program, there's been a steady increase in caseloads and expenditures since August 1996. In Whitehorse, for example, caseloads have increased on average by 70 per month between August 1996 and September 1997.

Average monthly expenditures during the same period have risen from $522,000 to $615,000 - an increase of 15 percent.

The caseload growth we were experiencing in the social assistance program can be best explained by the growth in population and as a function of the unemployment rate. If we look at the period June 1996 to June 1997, the population of the Yukon increased by 683 people. Based upon historical utilization, this population increase alone would account for an additional 30 individuals in any given month receiving social assistance.

In addition to the population growth during this period, the unemployment rate rose from an average of 9.4 to 12.2, reflecting a slowdown in the economy due to the Faro mine closure.

In the region, high social assistance costs, due to volume increases, have been observed in seven of the regional communities. Not only have we seen a volume increase because of these dynamics, we've also seen the price increase on utility costs, which has impacted on expenditures in that area.

Mr. Chair, the social assistance program is there to protect the most vulnerable citizens during difficult times. The closure of the Faro mine, changes to the federal EI program and economic factors both in and out of the territory have impacted the number of people seeking temporary assistance from our social assistance program.

It is interesting to note that the caseload composition and duration in this program has been largely unchanged in the last three years. This reinforces the fact that what we are experiencing, both in Whitehorse and in the region, is an increase in volume. In order to respond to this increase, we are seeking an additional $1.6 million of Whitehorse social assistance and $480,000 for the communities.

I would like to draw your attention briefly to the O&M recoveries. The increase in family and children's services recovery of $904,000 represents an adjustment of the DIA child welfare recovery estimate to a level reflected in the year-end statements for 1996-97.

Mr. Chair, we are making some progress with Indian Affairs at this time. At the present time, we have received from them almost $4 million for 1993-94 and an agreement to pay the undisputed amount of approximately $4 million over each of the following three years. We have also agreed on a process to resolve the outstanding disputed amounts based on the review and adaptation of the B.C. actual costs approach and formula. I'm optimistic that, before too long, we will be in a position to recover some of the outstanding amounts owing from DIA for child welfare services provided to status First Nation members in the Yukon.

After we have that issue settled, we will be pursuing other outstanding matters. To date, in all program areas, there is still $24,896,000 in outstanding claims with DIA.

With respect to the capital budget, there are two highlights that I want to draw your attention to at this point. Under policy and planning in the administration, we are requesting an increase of $470,000. This is simply a revote for outstanding contractual commitments related to systems development within the department. A variety of reductions in other projects have in fact offset this vote.

The other substantial revote relates to the Whitehorse General Hospital construction. We are requesting an additional $4,826,000 for this year. This reflects work that was carried over from the previous year and does not affect the overall cost of the project. Capital recoveries have also been adjusted to reflect this change.

Mr. Chair, this completes highlights from the Department of Health and Social Services' first supplementary budget of this year. I'll be pleased to answer questions that the members may have.

Mr. Jenkins: I thank the minister for his overview of the department, and I guess we can start at the top of the list with one of the largest costs that his department is incurring. The Whitehorse hospital has received $979,000 in funding, and it's expected to still be in the red after this transfer.

To what extent and how does the minister expect to fund that additional overexpenditure, Mr. Chair?

Hon. Mr. Sloan: We have begun some discussions with the hospital, as I was indicating somewhat earlier. We are beginning to get a handle on the hospital in terms of the ongoing monthly costs. Things do seem to be coming in line there. We are continuing to discuss with the hospital their financial position, and we will be working with them toward resolving their difficulty in that regard.

We feel that there are some things that they could still be doing, and we also feel that there are some ways that they, for example, could be deferring some costs. As I said, we are continuing to work with them in that regard.

Mr. Jenkins: There's a reduction of 12 full-time jobs at the Whitehorse General Hospital and a $988,000 cut in expenses, and the deficit appears to be heading towards about $600,000 for the current fiscal year.

The amount of funding of $979,000 wasn't enough to cover the costs when it was advanced, Mr. Chair.

Just how does the minister expect to fund that? Is he hoping Mr. Martin's recent announcement is going to cover those costs, or what is he going to do?

And could he elaborate on the areas where his department disagrees with the Whitehorse hospital as to how they can reduce costs or delay implementation of certain expenses for the next fiscal period? What would they be, Mr. Chair?

Hon. Mr. Sloan: Initially, the figure of $2.6 million was arrived at by discussions with the transition team. As the member may recall, earlier this year the hospital, because of a variety of issues, not the least of which were some staff and operational concerns, sought the assistance of the department in bringing in an overall review. Part of that review was an examination of the financial aspect of the hospital.

At that time, there was an agreement between the department and the hospital that the proposed deficit would have to be a shared one. In other words, the government would step in, and in this case we stepped in to the tune of $979,000, which was the figure that was suggested as part of the review, and it was agreed that the hospital would try to achieve the other $1.6 million in terms of economies. To date, they're still short of that target. We believe that they have some areas where they could still economize. We believe that there are still some areas where they can make some recoveries.

As I've said, we've really only had one meeting with them on this, and our department is continuing to work with them on finding ways that either these economies could be realized or perhaps some payments for certain things could be deferred. But we are continuing to work with them. We are interested in working with a more positive relationship, and I think in the end we'll be able to overcome some of these difficulties. As I said, they are beginning to make what we feel is significant progress in bringing their monthly expenditures in line.

Mr. Jenkins: Obviously, if the hospital is going to reduce its internal costs by $1.6 million, there must be some definite ways and definite areas that must be addressed. Just what are those areas, Mr. Chair?

Hon. Mr. Sloan: Well, we believe that the hospital can make some economies. For example, they could be looking at programs they are currently managing now, which they may choose to relinquish to the department. They may be looking at, perhaps, some additional recoveries in areas such as food services and things of that nature.

We believe that there is a variety of economies there that they could realize. We believe that the department, in this case, has stepped in to assist them in meeting their budget targets, and we're continuing to work with them. We think that they probably have some economies that they could realize. Part of their economies have been, certainly, within staffing, including management staffing, and we feel they're on the right track.

Mr. Jenkins: The minister is being quite vague in the areas in which the hospital is expected to reduce $1.6 million and costs. Program transfers from the hospital to his department - I would assume that this is just a direct transfer of responsibilities. What programs would they consist of, and would there be an overall resulting reduction in costs, or is this just moving money from one side of the ledger to another?

As for additional recoveries in food service, what are we going to do? Charge more for Jello at the hospital, Mr. Chair? How are we going to recover a significant portion of $1.6 million from the food service? These are the two areas identified.

You know, when he elaborates on that, Mr. Chair, if the minister could give consideration to a six-percent rise in patient admissions, was this amount of reduction predicated on any kind of increase in patient admission, or what model was it predicated on?

Hon. Mr. Sloan: I gave a couple of examples. For example, we don't increase the price of Jello as the member has suggested. I see the Member for Riverdale South believes that we should be increasing the price of Jello or perhaps even the quality of the Jello. The hospital does provide certain services, for example, services within the cafeteria for the public, but they also have a contractual relationship with the department for, for example, the Thomson Centre.

In addition, I think they've made some staffing economies. We believe that as they're able to utilize their systems better, as they're able to use their staffing in a more economical fashion, they will be able to realize those. They are predicting that in the forthcoming year they will be able to meet their budget target.

What I should point out is that we believe, quite frankly, that the operational budget of the hospital has been set at an arbitrary figure for too long and it does not reflect the kinds of programs that the hospital has been expected to deliver. It is a regional health centre and we're interested in moving to a budget model that more accurately reflects the needs of the hospital, the kinds of services that they feel are their core services and the kinds of services that they want to move into, for example, and we will fund them accordingly.

If I can't be more specific that's because the hospital management has met with us to give us their overall view of where their economic position is and they've also given us an indication that they're working at some areas of economies. Those areas haven't been fixed yet. We are going to try to work with them and be as supportive as possible.

In terms of being more specific than that, the hospital is self-managing, so they will have to find those economies, and we will be working with them accordingly.

Mr. Jenkins: Given the minister's overview of the hospital, it appears that the budget target is going to be achieved by transferring programs to other areas of his department and charging more for the services provided by the hospital to other areas of his department, that is, the Thomson Centre for food service.

Now, overall the costs are going to remain the same, and overall other areas of the same department are going to incur these financial responsibilities.

So, there has to be a model as to what the hospital is intended to do and how it has tended to do that job. Certainly, the target of its budget must be indexed based on admissions or some sort of a factor that would ratchet up the monies from the government to operate, based on some sort of a formula for admissions or number of days that patients remain in there and the services they receive while in there. We just can't throw out a number. The minister is justifying some of the costs on the increase in patient admission. Certainly, when you tie it all together, it's the same pocket. We can't just look at achieving the budget projections of the hospital by offloading programs.

Hon. Mr. Sloan: Perhaps I wasn't as clear as I intended. I was not justifying the additional $979,000 to the hospital. What I am trying to do is give the member a sense of where some of the trends are going in terms of the hospital. For example, when I say that the patient admissions are, say, up by six percent, what we're looking at is the trend.

The $979,000 was not premised on that at all. The $979,000 was the amount where it was felt by the transition team that the government had to step in to assist them in that regard. That reflected their financial position earlier.

I have to indicate to the member that the hospital has, to some degree, adjusted some of their costs, most substantially in the areas of staffing. This reflects, to some degree, the fact that, during the period that the hospital was under previous situations, it had premised its budget on achieving certain staffing and economic targets. Well, in fact, those targets were not achieved. Indeed, during the period that the targets were supposed to have been met in terms of reductions of staff, they, in fact, increased staff.

Now, some of that can be explained to the period of construction, the period of transition. What they have done recently is that they have begun to pull back from that higher staffing level to a more manageable level. We believe that, combined with some economies that they can make internally in terms of staffing. For example, I'm not sure if the member reviewed to any length the report that came out from the transition team, but they did have some very definite recommendations in terms of how staffing could be adjusted and how staffing patterns could be adjusted to make some considerable savings. We believe that the hospital has moved in that direction now, and they are now moving in the direction of achieving budget targets.

Mr. Jenkins: Well, another area in the hospital that's causing an increase in costs is that the hospital was supposed to be an acute-care facility, and it's being used more as a chronic-care facility. How does the department and the hospital intend to deal with the growing number of patients requiring longer-term care, Mr. Chair?

Hon. Mr. Sloan: I presume that the member is referring to the comments made by Dr. de la Mare at the meeting last night.

I think with regard to that, Dr. de la Mare was probably expressing some frustration with certain points, and we do believe that they are occasional points, and Dr. de la Mare was careful in his analysis to indicate that it was occasional. But occasionally they do find themselves pressed with regard to certain areas of the hospital being overloaded. Although, overall, I think we've only had one day - and that was on March 19 - when we were actually at full capacity. In most cases, the hospital runs about 60 percent. The difficulty that Dr. de la Mare referred to, I think, has been the tendency for some people to be kept in perhaps -

Some Hon. Member: (Inaudible)

Hon. Mr. Sloan: Well, I don't like to use the term "babysitting," although Dr. de la Mare did use it. But I believe that Dr. de la Mare was making reference to the fact that probably there are some people who could be more appropriately cared for at home or more appropriately cared for in another setting. Old trends are very difficult to break, and certainly sometimes attitudes with regard to medical services are difficult to break.

I think what we have begun to do is we've - Dr. de la Mare was emphasizing the fact that this is an acute care facility. What we have recognized is that, increasingly, given the demographics that I indicated earlier, given the population trends, we're going to, I think, have to move away from our emphasis on an acute care model, which has been the emphasis with the building of the project, with the realization of that project.

Now we're going to have to be looking at a medical model that probably reflects more of an extended care, continuing care/home care kind of model. That certainly is something that our department is interested in moving into. That's something that we have begun to plan for, and if I interpret the signal right from my federal counterparts, there seems to be an expression of interest in that area as well.

Mr. Jenkins: That is where I was taking us on our next question, Mr. Chair.

The numbers that I have from previous discussions on this Health and Social Services budget was that it's about $785 per day for patient care at the hospital and $348 per day on average at the Thomson Centre. Has any consideration, other than your brief overview, been given by the department to upgrading the home care program as a means for caring for those in need? It's done at a fraction of the cost.

Hon. Mr. Sloan: Well, the member certainly is anticipating where we're going with this.

I think what I indicated earlier in my opening remarks is that we are facing a very different population. We are facing a rapidly aging population. The fastest growing segment in our population tends to be in the seniors area.

What we've begun to do is an assessment, this past year, on services to seniors in the Whitehorse area, trying to discover gaps. We have also begun an assessment of rural services to try and discover where the gaps are, needs that we have in home care, needs that we'll have in continuing care. We have identified two primary areas in the Whitehorse trend, one being the need for a supported, independent-living kind of model, which I would characterize as a facility for individuals who may need some limited support, not something in terms of a full-blown care facility.

The other area was in day programming for at-risk seniors. For example, perhaps, maybe for lack of better care, I guess elder day care, if we want to think of it in those terms, but day programming for individuals.

Yes, home care is a substantial savings. That's something that, while it isn't the primary driver, our main driver is trying to provide people with a level of comfort and a level of ability to stay in their own homes, but, yes, it's certainly a major economic driver and something we're going to have to look at.

Mr. Jenkins: Thank you, but that leads to the question - we're all in agreement as to where we're heading - what steps have been taken by the department to improve on this area and to enhance this program, or are we just going to kick it around and discuss it for ever and a day?

Hon. Mr. Sloan: Presently, we feel that we are meeting home care needs as they are, but we're aware that this is an area that we're going to have to be directing more of our resources into.

Certainly, our future capital and O&M budgets are going to reflect this trend. We are going to have to take a very serious look at what facilities we have available, what facilities will need an upgrade, perhaps what kinds of facilities we will have to be working at in a cooperative fashion with Yukon Housing. We're very aware of this and we are preparing now, with our rural information, to bring forth an options paper, probably in March or April, which will, I think, give some direction in that regard.

I have to emphasize that, with regard to a seniors strategy, I don't think we're talking exclusively facilities, I don't think we're talking exclusively programming, but we're also looking at some other related social issues. For example, with seniors, the question of how this impacts on Pharmacare; the question as to how, for example, there may be some legal changes that we should be, I guess, advocating, such things as continuing power of attorney, estate protection - well, estate protection has gone through - but we're looking at it from an overall seniors' agenda because we believe this is where the greatest need is going to be, certainly by the early part of the next century.

Mr. Jenkins: I would suggest to the minister that the area that's probably needing the most is the facility end of it, especially in rural Yukon, and I like the concept of supported independent living very much. If the minister is doing an analysis of the various facilities in rural Yukon, I can certainly tell him that the one in the community that I reside in is very much in need of upgrading and expansion. I was hoping he could have time lines when that would occur, Mr. Chair.

Hon. Mr. Sloan: As the member is aware, we did some work on McDonald Lodge this past summer. We are certainly aware of all the limitations in McDonald Lodge, in terms of capacity and age, et cetera. But on the immediate need, what we did was to construct an attachment system to the piles on the crawl space. That was around, I think, $5,600. What that did was basically eliminate the need to redo the entire building foundation, which would have come in at about $400,000.

Essentially, what this will do is to keep McDonald Lodge functioning until a more long-term plan for Dawson City facilities gets in place. Along with that, I think it's no secret that some of the individuals in Dawson have looked at, for example, a hospital/extended care facility in the future. So, those are some of the things that we have been listening to.

I was up in Dawson earlier this summer, toured McDonald Lodge, spoke with the folks at the nursing station, and certainly got a sense from them of the kinds of needs that they're going to have. There seems to be an appetite in that community for one sort of central complex. So, I would imagine that as we're developing facilities, that would be the kind of model that we're working towards.

Mr. Jenkins: Well, I would just take the minister back to a community north of here - Dawson and that area. Both the facilities - the nursing station and the seniors complex - were constructed in the late 1960s, both of them, when the population was one-third of what it is presently. We're servicing an area population of some 2,200 today with those same facilities, so there is a need.

All we're doing to date is putting a band-aid on the foundation to justify it for a little bit longer. There's a pressing need and there's an urgency, as these buildings age to the point that they are. I was just hopeful that the minister could give a clearer indication than he has of the time lines for this pet project that the minister's going to entertain, coming to fruition.

Hon. Mr. Sloan: Well, Mr. Chair, we're always very cognizant of the heritage nature of Dawson, so we wouldn't want to do anything too precipitous, because these buildings probably have a heritage quality, right? Knowing the restrictions in Dawson, we would want to make sure we weren't damaging that heritage quality.

No, we are working with the local group that has been established there, looking at long-term options. As I said, part of our package in this regard is going to be currently looking at rural facilities and the needs there. We're hoping that some recommendations will be contained in our options paper in the spring.

Mr. Jenkins: We still don't have any time lines other than the looking, Mr. Chair, and I was wondering if the minister could be more specific than the review being completed and something brought forward by the spring. When would he envision something actually taking place? Is it in the five-year capital forecast? Is it going to be in the next two years or three years?

Hon. Mr. Sloan: I'm sorry I can't be more specific in terms of time lines, but there is that group there who are reviewing options for Dawson and, as well, we are also looking at our own options in that regard. I think one of the things that we have now, with the phase 2 transfer, is the capacity to begin to set some of our own priorities, and the member can rest assured that, as health priorities are developed, we're very cognizant of the needs in rural communities.

Some communities have benefited already. There's a new health station, for example, in Ross River. So, we will be attempting to address all these needs over the next few years. I'm sorry I can't be more precise than that.

Mr. Jenkins: While we're in the rural area of the Yukon, maybe we could be specific as to any policy the government's going to come forward with with respect to the attraction and retention of physicians to rural Yukon. Is this an initiative that is being worked on by the department or is this an area that the minister doesn't deem requires addressing?

Hon. Mr. Sloan: We're always interested in our physicians. They're a key part of our health delivery system. We have, as the member may be aware, a situation in Faro where we have a physician on salary. We've had some discussions with YMA, and YMA, incidentally, has been supportive of that option. That may be an option that we may look at in the future.

We are fortunate in this territory in having some very high, in comparative terms, fees. As well, we provide some attractive incentives for our physicians, both in terms of post-graduate training and some other issues. As part of our most recent fee negotiations, we set down the agreement with the YMA to explore alternative payment methods - such things as on-call fees and things of that nature - with the YMA.

Coming out of the discussions, the YMA more or less asked us to do those on an individual basis with individual physicians, because the situation in so many Yukon communities is so different, and that's what we're currently pursuing. Our ADM of Health will be exploring in different communities.

I've had, for example, just for the member's interest, southern physicians express to me very clearly their interest in going on a salary basis in this territory. So, I think there is a whole variety of options open, and we're working with the YMA. We're working with individual physicians to try and overcome some of those problems. I am, for example, aware of some of the needs expressed by the rural physicians in terms of on-call issues, and we're working with them individually.

Chair: Is it the members' wish to take a brief recess?

Some Hon. Member: Agreed.

Chair: Ten minutes.

Recess

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

Mr. Jenkins: Just before the break, we were exploring what this government was doing to attract and retain physicians and dentists in rural Yukon. The minister ran over a number of the areas that have been in existence for awhile. I'm aware of one physician who is paid on a salary basis, and the balance are on a fee-for-service basis. Has there been any change to the status quo? This is the way it's been for over a year - almost two years. What policies has this government developed to attract and retain physicians and dentists in rural Yukon, above and beyond what existed, let's say, a year ago, or before this government came into power?

Hon. Mr. Sloan: One of the issues is that we have worked with the medical community. There is a Physician Resource Council, where we work with our physicians in determining needs of communities; determining an appropriate level of physician services.

To a large degree, we've had strong cooperation from the council. Earlier, I gave the example of the physician on salary in Faro. It's an option that we would certainly be willing to explore to a greater degree, where there was need or where there was a level of interest. However, we're not interested in doing that at a point of perhaps displacing physicians who are already in a fee-for-service mode. I think it has to be recognized that a number of our primary communities - Dawson City, Faro and Watson Lake - are currently served, I believe, with at least two physicians. I believe Watson Lake has three, although that may have recently changed.

But our indications are that the level of physician services has been fairly good in those communities. We have had some interest, for example, from the community of Haines Junction in the possibility of a resident physician. That hasn't emerged as a major issue but, certainly, we've had some inklings of interest in that area, and if, for example, it were to become a major desire of the community, we would discuss with the YMA what the most appropriate modes of attracting someone there might be. It may be, for example, a salaried physician.

In addition, we have provided some incentives for physicians, as I indicated earlier - such things as malpractice insurance coverage, post-grad kinds of training, patient-related communications. As well, most recently, as part of our agreement with the physicians, along with the salary increase, we've also instituted some funding to help physicians get, I suppose, electronically linked. We're working with them actively on issues such as tele-medicine and others. We are willing to explore a whole variety of options to attract and retain physicians.

With regard to dentists, we have a resident dentist in Faro, we have a resident dentist in Watson Lake, and it's my understanding that we have an agreement with the Yukon Dental Association to serve Dawson City. We've had some indications that Dawson City may have been successful in recruiting a dentist on a more permanent basis. Now, that has yet to be confirmed by the municipal government but we've just had some indications in that regard.

Mr. Jenkins: Just one point on the dentist. Could the minister provide a cost breakdown of what the government is incurring to provide the dental service in Dawson for the last period of time? He could send it over by way of legislative return. I don't need it right away. I just would like to have a handle on what it's cost this government to date to renovate the new premises, to install the new equipment and to bring the dentists back and forth - the actual service contract that is so difficult to obtain, Mr. Chair, from another department that the minister has under his domain.

With respect to the program for encouraging physicians to locate in rural Yukon, I notice the minister chose his words extremely carefully, "the appropriate level of physicians." Is this the arrangement whereby they are restricting the number of billing numbers given out to rural physicians? There has recently come into being a restriction on the number of billing numbers given out. Is this the area the minister is referring to? How is the appropriate level of physicians determined in rural Yukon, Mr. Chair?

Hon. Mr. Sloan: Well, as for an appropriate level, the CMA generally sees a physician level of anywhere between 500 and 700 as an appropriate level for a community - one per 500 to 700. Admittedly, in, I suppose, urban Yukon, speaking primarily of Whitehorse, that ratio is probably considerably enhanced.

With regard to the billing numbers, we have an agreement with the Physician Resource Council. There are some guidelines set down for shared practices, how much can be billed in a shared practice, where a doctor can get a billing number, et cetera. We've done that with the YMA and it's been fairly cooperative up till now. We're not anticipating any particular difference.

The YMA has been very accommodating in all of our discussions. They've been very supportive of the salaried physician experiment in Faro and that's something we hope to continue.

Mr. Jenkins: It has just come to my attention that, in my community, we restricted it to two doctors having a billing number at one time. Yes, it's a shared practice, but when you look at the number, the area population and you attend the office and you see how busy they are at certain times, do you think that this is a fair way of dealing with the demand? At times there's no demand. The next day you could keep three or four physicians busy. So what does it matter if there are three billing numbers, if they're on a fee-for-service basis, versus two. The object of health care is to provide response and to address the need.

Hon. Mr. Sloan: Well, as I would have emphasized before, we have worked this out in accord with the YMA. I don't have the exact figures here, but I can check on them for the member. But as an additional physician comes in to a practice, there is an incremental amount that that practice is allowed to bill. There is an interesting, I suppose, trend and an interesting issue with the whole economics of physicians, and that is that very often the more physicians, the greater the amount of cost.

Now, one would suppose that if a community had, say, three physicians and the same number of people, the physician costs would remain fairly constant. In reality, what happens is that there tends to be an incremental growth, as you now have three physicians and all physicians are trying to make a living.

As well, we have a phenomenon here where some of our positions, because they're perhaps more removed from professional colleagues and we have a younger physician population up here, there tends to be a greater volume drive. I mean, we've certainly seen it here. I've given some indications of what our physician volumes have been.

We have, I suppose, been wrestling with this issue for the last little while. We have been very loathe, for example, as other jurisdictions have been, to put a global cap on physician fees. That has been the practice in some jurisdictions. Some jurisdictions have gone to a roster system. We are not at this point looking at a cap, but we've certainly made clear to our health partners in the YMA that we do have to get some kind of handle on physician fee increases. In that regard, the incremental amount for the memorandum of understanding has been a 0.5 increase on April 1, 1997, and a 0.5 increase on April 1, 1998.

Now, as well, there is also an agreement basically set out in that that should the volume increase exceed that of the population, plus or minus one or two percent there, we will go back and reopen that, renegotiate it. And, I think implicit in that is that we would have to find some way to control physician fee increases.

Mr. Jenkins: I'm surprised, Mr. Chair, that an individual who has resided in rural Yukon would take the view that he has. It is a most interesting one, and I'm sure when he was residing in rural Yukon he spent very little time in the nursing stations in rural Yukon; he'd go and attend to a physician right in Whitehorse. And, by and large, that is the case for a lot of people in rural Yukon, and the in-between points. They maintain a relationship with a physician in Whitehorse. And the permanent residents who, probably in some cases, have not the means to travel, are the ones that are reliant upon the physician services in rural Yukon, and from time to time it is very difficult to get an appointment.

This came to pass not too recently in the fall of this year in my residence. I inquired and well, there were only two doctors on duty. I knew full well there were three in town. Well, one is not allowed to work. One doesn't have a billing number. The government restricts the number of privileges issued in the area.

So, it's an area that is easy to look at academically from Whitehorse, but one has a different viewpoint of the situation when one is looking for the services provided by the medical community from rural Yukon.

I would urge the minister to reconsider his stand on this issue and urge him to carefully examine this before enshrining this in any policy manual anywhere because it could come back to haunt us all. So,

I would appreciate his comments in that regard, because it is not as it appears on the surface.

Hon. Mr. Sloan: As a long-time resident of rural Yukon, I can appreciate some of the member's concerns. I lived for a few years in a community without a resident physician, and that necessitated driving. I was fortunate to live for a large number of years in Watson Lake, where we were served very well by the long-time physician there, Dr. Secerbegovic, and colleagues that he had. I never, at any time, felt that I was deprived at all in Watson Lake because there was an excellent medical staff there and very dedicated physicians.

I can appreciate some of the pressures in rural communities. One of the things that we've encouraged is a greater level of cooperation between the YMA and their rural physicians. This has come up with such things as fee schedules and others, and we would certainly encourage the YMA to continue in that. As a matter of fact, if municipalities were to express to me the fact that they felt that the current billing arrangements were restrictive on availability of physicians and things like that, that's something that I would bring forward to the YMA, because we have ongoing discussions with the YMA. We've found them to be very cooperative. The new president, Dr. Ken Quong, I think has proved himself to be more than amenable to a variety of concerns with us. So, if those are concerns of municipalities, and they want to bring them forward, I could certainly relay them in future discussions.

Mr. Jenkins: But the minister does realize that there's certainly a different situation in Watson Lake than in Dawson City. The facility in Watson Lake is a cottage hospital. In Dawson City, we're talking a nursing station and, for the population levels in Watson Lake vis--vis Dawson, one questions the justification of one in one area and not one in the other. How would the minister explain the difference?

Hon. Mr. Sloan: Mr. Chair, how can we explain the vagaries of the federal government and the machinations of the government? However, we do have a hospital in existence in Watson Lake and -

Some Hon. Member: (Inaudible)

Hon. Mr. Sloan: Well, the member says they had a hospital in Dawson City at one time and, yes, it was downgraded to a nursing station and I can certainly understand the issue surrounding that. I've heard the same issue, as a matter of fact, in Mayo, where people very often have that association in rural communities with the loss of a hospital, it being a very central focal point for the community.

We're certainly aware of that and that will be, certainly, one of the things that we take into consideration in future developments.

Mrs. Edelman: Mr. Chair, I'd like to turn back to the hospital. Now, it's quite clear that there was an underestimate of the costs at the hospital. It's also quite clear that, in the past, the hospital was run in a deficit position and sometimes there have been surpluses. That has happened even when they were under the federal government. Now, what I'm wondering about is, will there be an increase to the base transfer to the hospital each year? Is that what you're looking at, or are you looking at - ?

Hon. Mr. Sloan: Well, I think there's no secret to the fact that I've expressed here earlier this evening and I've expressed on other occasions, that I've felt that the budget target that was given to the hospital in terms of "This is the amount and thou shalt go no further" was perhaps an unrealistic target, given the expectations upon the hospital.

The hospital itself - its operational budget - was, I think, premised on perhaps some staffing targets, which were not realistic, and on some operational targets, which were not realistic. We have said, and it was the view of the review team, that the budget perhaps was not accurate for that hospital.

They said they felt that there were economies that could be achieved and there were economies that would come on-stream, but they are not going to be economies that are going to be hit within the next three months, four months, whatever. Downstream we expect it, as some of the electronics systems come on, as some of the other, I guess, modern techniques come on or we move to more out-patient surgery, things of that nature. Then there will be economies.

But to return to the central point, yes, I anticipate that probably we will have to be looking at an increase of some kind to the base budget and then I would emphasize again that we're going to be trying to work in a more cooperative fashion with the hospital to try and establish realistic targets for what their budget should really reflect, what we're asking them to do, if, for example, we ask them to, say, do a greater post-partum program. Say, for the sake of argument, we wanted them to do more kind of followup in post-partum kind of thing. We couldn't say, "Well, you know, that's what you're going to do with your existing budget and you make it fit." I think if we ask an institution like the hospital to take on a particular service, we have to reflect that. By the same token, they could come to us and say, "Well, we don't feel that this is part of our function to be running this kind of program." The needle exchange that previously existed at Whitehorse General Hospital, maybe that might not have been appropriate for a hospital and there were ways that we could do it within Aids Alliance and things like that.

Those are services where they may say, "Well, perhaps this isn't an appropriate service." So, what we're going to have to do is sit down with the hospital and work out realistic budgets and realistic performances, realistic expectations on an institution. I don't think we can be unrealistic in our expectations of them.

Mrs. Edelman: That's interesting. Apparently from what I'm hearing the minister say, there's going to be a deficit at the end of this fiscal year. When the minister kindly provided the budget briefing from his department there was an indication there that, probably within two years, it might come out as a balanced budget. Now, if the minister, the head of his department, is trying to keep an arm's-length agreement with the Hospital Corporation, how can the department then go in and micromanage on program development? I'm really confused about how this is working.

Hon. Mr. Sloan: I should caution the member from Dawson there. I do have certain medical powers. I would suggest that we're not interested in micromanaging at all. We're interested in working with the hospital, and the review team that did come in suggested that probably one of the difficulties with the hospital was perhaps a higher level of political interference than what might have been desirable in the past.

We're not interested in micromanaging. We're interested in working with the folks that were in the hospital, but we're also interested in sitting down with them when they come to us with their budget.

They're coming to us and they're saying, "Well, this is what we're projecting in terms of program needs", et cetera. I think we have to be more realistic and say, "Okay, well if this is what your program needs are, fine. However, we might, because we are in kind of a unique role here" - it's a very interesting role; we're not only the primary supplier of health dollars, but we're also a delivery system in many ways.

Say, for example, that we felt, in the Department of Health and Social Services that there was a health education role that the hospital might be able to undertake. They have staff, they have spaces now where they can do this kind of instruction. Say, for example, we asked them to undertake, perhaps, a health education role. I think that if we asked the hospital to deliver that role for us, it would be incumbent on us to make an adjustment to their budget to reflect that.

I'm not interested in mircromanaging. I'm not interested in getting into day-to-day staffing decisions or day-to-day - I like to call it - the blue and green Jello analogy. If I start into micromanagement and I start deciding on who's doing what in that hospital, pretty soon I'll be deciding whether it's red Jello or green Jello on Tuesday afternoons. So, I'm not interested in going down that slope. No pun intended.

We are interested in working with these folks.

Mrs. Edelman: Mr. Chair, plainly the minister didn't get enough Jello at supper.

We spoke earlier tonight about the negotiations with the medical association. The hospital is in the process of negotiating with PIPS. Is there any word on how that negotiation is going?

Hon. Mr. Sloan: It's my understanding that they've agreed to go to arbitration, I believe - arbitration or mediation. I believe that Brenda Riis, the chair of the Hospital Corporation, raised that issue last night, and I'm not sure whether it's arbitration or mediation. I can find out for the member, but I do know that they have gone to some sort of settlement mode, and I can find out the details.

Mrs. Edelman: While the minister is getting this information, I wonder if he could also update the House on a recent story in the paper about - of course, an area of concern for many of us who use the hospital - the closure of beds over the holiday period and then again in March. It was my understanding that the hospital was speaking with the Medical Association and that they had changed that to merely some closures during the March break, and I'm wondering if there is an update on that information.

Hon. Mr. Sloan: I think that that came out of some discussions around the YMA convention, and it suggested that some beds would be closed and that two operating rooms at the Vancouver General Hospital would be closed. We've been advised by the hospital that all in-patient units throughout December will be staffed and that there will be no bed closures.

With respect to the operating room, the hospital is going to follow the same practice that it has followed in the past - this is nothing new - and that is to keep one operating room staffed during the Christmas week, which is December 22 through January 2. This is basically just a reflection of the fact that the hospital can respond to any needs for surgery, but elective surgery isn't kind of high on my Christmas wish list and I don't suspect that somebody else writes to Santa and asks for an appendectomy or some kind of elective surgery during the holiday season. So, I think that does reflect traditional usage.

We have checked this out with jurisdictions in other parts of Canada, and, traditionally, elective surgery is not associated with the festive season.

Mrs. Edelman: Just a point. I don't know about in the minister's family, but in our family appendectomies are not elective surgery.

Some Hon. Member: (Inaudible)

Mrs. Edelman: Yes, and there are many, many surgeries that I considered for the minister over time.

Now, essentially the cutting down of services during the Christmas holidays - are there any other cuts in services that we can expect at some point in the future?

There are various programs that have run out of the hospital in the past, particularly when the federal government ran that hospital. Are there any other cuts in service that we can expect in the near future?

Hon. Mr. Sloan: I'll resist the temptation to suggest circumcise but, no, we are not anticipating any further cuts, so to speak.

Mrs. Edelman: This is turning into frightening conversation.

One of the other issues that we heard - back in January of this year, there was a report that came out from the YRNA that was totally ignored, but there was one that just came out from the Yukon Medical Association, and they had concerns around early discharge and the lack of home care service.

Now, home care has been cut in the budget and there are no immediate plans, as far as I can see, for building up facilities. What is the plan for early discharge? Is early discharge one way to save costs at the hospital? It doesn't work unless you have appropriate home care in the community because you end up paying for people to come back usually with something worse than they came out with. What are the plans for support of the early discharge program and home care?

Hon. Mr. Sloan: I've been advised that early discharges are happening and that we are managing them at this point. We will be, of course, continuing to monitor the situation and trying to address it. I think there's no secret of the fact that, had I been able to realize some of the funds that we might have been able to access through changes in the CHST, we would have been looking at moving into some other areas of home care. However, the shortfall at the hospital sort of precluded that because much of those resources went into overcoming that in the hospital.

Depending on what future levels of funding are available in that regard and depending on how much we have to invest in the hospital to maintain it at adequate levels, we're certainly looking at that as an option as a way in which we can assist hospital home care and early discharge in the future.

Mrs. Edelman: Getting back to the Medical Association again, what is the situation with the physician services in Faro?

Hon. Mr. Sloan: We have two physicians in Faro. One, Dr. Bamford, who is on a fee-for-service basis, and the other one, Dr. Fast, who is on a salaried basis working out of the hospital.

The physician on salary operates in the hospital with the nurses in what I suppose could be called an extended scope of practice.

Mr. Jenkins: (Inaudible)

Hon. Mr. Sloan: In the nursing station, I'm sorry. I see the Member for Klondike is very careful about the semantics of the term. Yes, indeed, he works out of the nursing station, and Dr. Bamford works on a fee-for-service basis.

Mrs. Edelman: I suppose that what I wanted was an indication of how long the contract was with the doctor that's in there now.

Hon. Mr. Sloan: This contract was renewed back in the spring. I'm just looking right now for the period of time. I believe it's a two-year period.

Mrs. Edelman: It's quite interesting because, unless Faro gets really going here fairly shortly, I can't quite see how there is enough business for two doctors. Are there any clauses in the contract so that if it reaches below a certain population level that we can get out of that?

Hon. Mr. Sloan: Yes, there are. I don't know if one would call it "getting out", but we do have an agreement so that, if the medical demands don't require it, by mutual consent, Dr. Fast could step out of that agreement, if we come to a common accord that his services aren't needed, or are perhaps underutilized.

The other option we've worked out is that Dr. Fast may be able to be utilized in other communities. I have to say that Dr. Fast has been quite accommodating in this. I think he's tried to work cooperatively in this regard.

Mrs. Edelman: I hope that he has been.

Back to the Yukon Medical Association again and Dr. de la Mare's very careful comments about babysitting up at the hospital. It actually reminds me of the story of when the minister went down to Vancouver to tour the mental facilities. Speaking of mental facilities, one of the bits of babysitting that the doctor may have been referring to is how mental patients, if they haven't been taking their meds and - you know, they don't take them after awhile - end up back on the ward. This is a very, very expensive way to take care of people who need a little bit of monitoring to at least take their meds, and it's a chronic problem. And it's a problem that Dr. de la Mare, in particular, has brought up repeatedly. I'm wondering if there's been any movement on that front.

Hon. Mr. Sloan: It's interesting that the member did bring up my trip to visit mental facilities in Vancouver and I should emphasize "visit mental facilities," not in a sense of being a resident, but rather to see how mental health services could be delivered.

But one of the interesting models I think that I saw down there was the idea of people who were being serviced in a non-institutional setting and this is an issue that I've talked around with, for example, Dr. Smith, and the whole question of individuals who have emotional or perhaps mental difficulties who we may be placing in a hospital setting, which is not only unnecessary for them, but I think unnecessary in terms of cost and in terms of personal restrictions.

What we'll be looking at through health is some way to try to deliver mental services in a less intrusive way, perhaps on more of an out-patient mental health model, where there could be perhaps individuals being monitored, but not in a hospital setting. That's the model that we think would be far more effective, would put far less demands on the hospital and would provide patients with more dignity.

Mrs. Edelman: Just a point. The minister did go down by himself for those tours.

Once again, we've talked in the House recently about the plan for development of some sort of extended care facility down in Watson Lake, but there is a huge waiting list for Macaulay Lodge. There's a waiting list to get into McDonald Lodge. What are the plans to date for the development of further seniors facilities in Whitehorse and in the Yukon?

Hon. Mr. Sloan: Well, I think I might be premature at this point by presuming what they are. I indicated earlier what we identified as being an area of concern. Some of our figures are beginning to suggest that, in the future, we're going to have to be looking at either a major expansion of Thomson or some other facility and perhaps re-ordering how our present facilities are being utilized.

It would be premature for me, right now, to say that this is what we're going to be doing but, very clearly, we've identified some areas of concern. Very clearly, we're going to have to take a hard look and make some decisions as to where we're going to go with this.

With regard to Dawson City, I think I made reference to the fact that probably future developments in that regard will be tied into the health complex - note the semantics -

Some Hon. Member: (Inaudible)

Hon. Mr. Sloan: - and provide exercise, education all at one-stop shopping, yes.

With regard to Watson Lake, we've done an evaluation down there of what the possibilities are in terms of space requirements in the hospital. We've also taken a look at what kinds of facilities are available with regard to Yukon Housing, modified housing, fourplexes and that kind of thing.

So, we're expecting some information back there as to what we can do in that regard and what is available to us.

Mrs. Edelman: Many of these needs have been identified for a number of years, but there have been no time lines put on the development of a plan. Plans are good. Are we looking at the development of a plan within the next year? Is that the plan?

Hon. Mr. Sloan: Yes, Mr. Chair. We're anticipating that we would be able to bring forward an options paper, I believe, in March. That would form the basis for some of our future decisions. At that point, I would hope that we would have a fairly lively and fairly interesting discussion among all the stakeholders in this regard - people involved in the health professions, certainly the seniors community, the Council on Ageing - a whole variety of individuals. We would be seeking input. We would be seeking some suggestions from them in terms of priorities. What do they really, clearly see as the most immediate needs? What I'm hoping is that that would form the outline for, quite frankly, a good deal of our health planning in the next number of years.

Mrs. Edelman: It does feel, some days, that we are growing old rapidly together.

The issue around mental patients - I hear you speaking about the development of an option plan that's coming out in March. What about mental patients? What about the plans for them?

Hon. Mr. Sloan: We are looking at some ways that that could be addressed.

Clearly, one of the things that we've identified, for example, when we've talked around issues such as transients, one of the issues that's come up fairly frequently on this has been that we do have a community of individuals who sometimes, for a variety of reasons, as members indicated - perhaps going off their medications during periods of personal crisis - do find themselves at loose ends - certainly, no pun intended. But they do find themselves sort of caught betwixt and between, and that's something that we have looked at in the context of some kind of a transient shelter. For example, if those individuals came in, would there be an ability to provide, say, a period of time where they could remain there to be monitored and perhaps make some connections with their physician?

Interestingly enough, when I've discussed this with the street nurse, many of the individuals that she works with often fall into that category where many of the health problems - yes, there are the usual bumps, scrapes, infections - she deals with are related to pharmaceuticals or to people going off their medication, people experiencing crisis, that's an area that we have identified that we'd like to work with a bit more.

Mrs. Edelman: Very interesting conversation. I suppose what I haven't heard from the minister is an indication of a time line on development of some sort of option for this group or something for people to discuss. Are we talking once again about the March period?

Hon. Mr. Sloan: Thank you, Mr. Chair. I know I should wait to be recognized.

I would hope that we could begin some development on that, certainly, in the spring, but I think it's no secret that very soon we're going to have to take a look at the whole question of the Mental Health Act and review that. That's going to be a major piece of legislation in the whole question of treatment and dealing with individuals who would fall under this. So, I anticipate that that's going to be a major piece of legislation and we're going to have to work through a lot of situations in that regard.

Mrs. Edelman: It's interesting that we talk about the review of the Mental Health Act, because there are a few pieces of legislation that are probably going to have to go out to consultation. One of them is the Mental Health Act and the Optometrists Act has to be brought up to date. There have been a lot of changes that have happened since that act came out, and midwifery consultations. I would imagine that there will be a desire on the part of the department to review some of the Registered Nursing Profession Act because we are now responsible for nurses in the Yukon.

Have there been dollars identified for the consultation process?

Hon. Mr. Sloan: Well, we haven't put them in this particular budget, but I imagine that as we come forward with our future budgets, we are going to be identifying some funds for consultation.

The member has indicated the review of the Mental Health Act. That is certainly going to be a key piece. She has also identified some of the professions, and this is one of those peculiarities in the territory that, in fact, many health-related acts that one would assume that Health has some responsibility for, actually fall within consumer affairs in Justice, and that does create some real confusion, because people involved in health professions, such as optometrists - I met just last Friday with the pharmacists, who are dealing with an act that in many cases is very much out of date. And, with some of the changes that we have done in nursing practices, it's really at variance. So, they have come to me and they've said we really do need to move this forward.

I would like to get some of those health profession acts moving forward. I would like to work with optometry - it's one that we have identified; pharmacy is one that we have identified - I'll be talking later on this week with the RNAs, so I may hear about their desire in that regard, because they do have some concerns, particularly with regard to nurses that are in outlying communities.

And their scopes of practice, where they're being asked to do more - they're being asked now to get into the area of administering some drugs. So, we're going to have to work on some of those professional acts, and I'd like to move them ahead.

However, it is often very difficult to explain to people, "Yes, I hear you. Yes, I hear your concerns but, by the way, go down the road to Justice because they're really the people that have them." There may actually be some merit in thinking as to where these acts should come. That, perhaps, is something we should be exploring, as well.

Mrs. Edelman: The minister brings out a good point. Basically, the nurses in the communities are nurse/practitioners, and they're midwives, too. For many of them, that is their area of specialty, and they've spent some years at educational facilities going into that area.

We spoke earlier in the debate about coming up with what sounds to be very similar to a halfway house for mental patients. In some ways, that's probably what it would end up being.

One of the issues that's come up repeatedly in the House is, of course, the shelter for transients. Now, this shelter was one of the campaign promises of the party in power now. One of the negotiations that's been going on is with the Salvation Army. The Salvation Army's corporate knowledge of providing transient shelters - their world-wide knowledge of this particular field - is quite incredible. You would be hard pressed to find an organization that would have more knowledge of that. As a matter of fact, I don't think there is one.

I know that the negotiations with the Salvation Army - some of them were more predicated on using the Challenge building, but not all of them.

Some Hon. Member: (Inaudible)

Mrs. Edelman: You better believe it.

But what I haven't heard is whether there were further negotiations with the Salvation Army outside of the Challenge building, and I know that when I spoke to representatives from the Salvation Army, they were told, "This is a service that we want. Give us a figure. Give us a plan of what to do." And so they came up with a figure and sort of a really rough plan that included, basically, a drying out place as well. When they went to the representative of the department and said, "Well, is this too much or is it too little," there was no indication whether there was too much or too little, and there was also no indication whether the whole proposal was predicated on using the Challenge building. They're feeling left out of the loop.

I'm wondering, is the department continuing negotiations with the Salvation Army? That seems to make an awful lot of sense. It seems to make sense to use the knowledge of the people that we already have in our community. Certainly they have more knowledge of this area than perhaps some government workers who might be putting the shelter together.

Hon. Mr. Sloan: I think perhaps the term "negotiation" is a bit of a misnomer.

When we began looking at this, we began looking at -

Some Hon. Member: (Inaudible)

Hon. Mr. Sloan: Let me just finish this thought. We began looking at a variety of organizations. Certainly, the Salvation Army, as the member has identified properly, has a track record in this. We asked them for sort of an idea of what they could bring forward. We asked them for an idea of an approximate price, which I think came in around $290,000 a year, but that was exclusive of a facility and we were required to find a facility.

When we began looking at Challenge, we had the possibility of a facility there that would have cost us, I believe, approximately $184,000 to renovate and we were looking at an additional $54,000 a year. That's a very pricey, transient shelter. I think I've indicated before what some of those figures are, and that was a very pricey option, but it was something that we were prepared to go ahead with. Well, as that option withdrew, we were forced to go back and take a look at other options.

I don't think we were in formal negotiations per se, but it was certainly something that we had been pursuing.

I think we have to be realistic in what we have available and what our needs are and what we can deliver.

We are still, you know, pursuing some options in that regard, and I hope to have an announcement probably later on this month.

Mr. Chair, I move that you report progress.

Motion agreed to

Hon. Mr. Harding: I move that the Speaker do now resume the Chair.

Motion agreed to

Speaker resumes the Chair

Speaker: I will now call the House to order.

May the House have a report from the Chair of Committee of the Whole?

Mr. McRobb: Mr. Speaker, Committee of the Whole has considered Bill No. 8, Second Appropriation Act, 1997-98, and directed me to report progress on it.

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

Some Hon. Member: Agreed.

Speaker: I declare the report carried.

Order. The time being past 9:30 p.m., this House stands adjourned until 1:30 p.m. tomorrow.

The House adjourned at 9:32 p.m.