Tuesday, April 8, 2003 ó 1:00 p.m.
Speaker:I will now call this House to order. We will proceed at this time with prayers.
Speaker:We will proceed at this time with the Order Paper.
Introduction of visitors.
Are there any returns or documents for tabling?
Are there any reports of committees?
Are there any petitions?
Are there any bills to be introduced?
Are there any notices of motion?
NOTICES OF MOTION
Mr. McRobb:I have for tabling the following motion:
THAT it is the opinion of this House that
(1) the Yukon Legislative Assembly has a role in ensuring that the Crown-owned Yukon Development Corporation and the Yukon Workers' Compensation Health and Safety Board are seen to be acting in the best interests of the Yukon public;
(2) the parties in the House have agreed that senior representatives of these two bodies will appear annually before the Legislative Assembly and be questioned directly by MLAs;
(3) to ensure that such appearances are as productive as possible, the government House leader must make best efforts to arrange briefings by representatives of the two bodies at least one week prior to their appearance;
(4) the ministers responsible for the Yukon Development Corporation and the Yukon Workers' Compensation Health and Safety Board should also arrange to have officials provide written copies of their opening statements to opposition members at least one week in advance;
(5) during their annual appearances, officials should make best efforts to be efficient in their opening statements and in responses to questions, with priority for questioning being given to opposition members; and
THAT this House urges the government to adopt the preceding process to achieve a higher standard of accountability to the people of our territory.
Speaker: Are there any further notices of motion?
Ms. Duncan: I give notice of the following motion:
THAT it is the opinion of this House that
(1) the Yukon Party government is ignoring the crisis situation with respect to children in care by refusing to act upon the first recommendation of the Child Welfare League of Canada to allocate more funding for social workers;
(2) the Minister of Health and Social Services does not fully comprehend the issues facing Yukon professional social workers, including high caseloads of families in crisis, legal liability of the Government of Yukon and the early burnout of workers; and
THAT this House urges the Minister of Health and Social Services to spend a day with a family and childrenís services intake worker in order to gain a basic understanding of the work these individuals do.
Speaker: Are there any further notices of motion?
Mr. Hardy: Mr. Speaker, I give notice of the following motion:
THAT this House do issue an order for the return of a list of all capital allocations in the main estimates for the fiscal year 2003-04 to each Yukon community, in accordance with the practice established by previous governments to provide this information at the time of tabling the main estimates.
Speaker: Are there any further notices of motion?
Mr. Cardiff: Mr. Speaker, I give notice of the following motion:
THAT this House do issue an order for the return of all printed or electronic correspondence since November 30, 2002 related to the review of the Workersí Compensation Act, including, but not limited to, briefing notes, minutes of meetings, directions from the minister responsible for the Workers' Compensation Health and Safety Board to the board, recommendations or advice to the minister from that board, orders-in-council, letters of appointment, terms of reference and contracts, as well as any correspondence between the minister and any groups or individuals considered Workersí Compensation Act stakeholders.
Speaker: Any further notices of motion?
Is there a statement by a minister?
This then brings us to Question Period.
Question re: Workersí Compensation Health and Safety Board appointments
Mr. Cardiff:Mr. Speaker, my question today is for the minister responsible for the Workers' Compensation Health and Safety Board. The Commissioner signed the OICs appointing the new chairs to the Workersí Compensation Board and the appeal tribunal on Monday, March 31. The Cabinet had to approve those OICs the previous week. What direct contact did the minister have with any current or former member of either body before the Cabinet approved the OICs or in the period between the Cabinet approving the OICs and the Commissioner signing them?
Hon. Mr. Jenkins: Mr. Speaker, Iím uncomfortable with the question, and I donít know exactly what period of time the member opposite is referring to as to what contact I had with the bodies ó which bodies? Could the member opposite be specific in his question? The exact period of time and which bodies?
Mr. Cardiff: I will read it one more time. What direct contact did the minister have with any current or former member of either body before the Cabinet approved the OICs or in the period between the Cabinet approving the OICs and the Commissioner signing them?
Hon. Mr. Jenkins: When the recommendations came forward from the various stakeholder groups, I did discuss the position with a number of the individuals whose names were put forward. I canít give the member opposite a definitive answer as to when I spoke with these individuals ó the exact timing of it ó but from memory, subject to checking with my Daytimer, I am of the opinion that it was all prior to these names coming before Cabinet for their approval, which took place on the Thursday, for the OICs to be signed on the Friday.
Mr. Cardiff: Well, we know that the minister did have one telephone conversation with a former employee representative in which the minister asked a number of pointed questions. But apparently the minister did not see fit to advise this former member at that time that his appointment was not being renewed.
On the same day the Commissioner signed the OICs, one of the employer representatives conveniently resigned. This gave the minister the excuse he needed not to reappoint the former employee representative.
When did the minister become aware that an employer representative intended to step aside, which had the effect of allowing the minister to reduce the size of the board?
Hon. Mr. Jenkins: The date on the letter of the employer rep who resigned was not the date it was received in our office ó that was sometime later. As to the exact timing of these occurrences, I canít be as definitive on the floor of the House as I want to be, but I can provide the member opposite with that information.
Question re: Workersí Compensation Health and Safety Board appointments
Mr. Cardiff:Yesterday the minister repeated his claim that he had hired the most experienced, most qualified and most able person to chair the Workers' Compensation Health and Safety Board. Why did the minister not apply the same logic when it came to appointing a new chair for the appeal tribunal?
Hon. Mr. Jenkins: Mr. Speaker, the act is very specific that the minister is required to check with all the stakeholder groups and make a determination, and that was done. There was correspondence sent out to the official opposition and the third party prior to these decisions being made, advising them there were a number of nominations and appointments to boards and committees that had to go forward prior to the structure of this all-party committee.
Where the member opposite is headed is that he wants to determine this is an election; it is not. Names are brought forward to the minister by the stakeholder groups, and a determination is made by government as to who that individual or individuals may be.
Mr. Cardiff: Well, itís not an election, but the minister needs to heed the advice that he receives from stakeholders. The former chair of the appeal tribunal is well-respected by all stakeholders on both sides of this question. Her reappointment was endorsed by employee groups and the Whitehorse Chamber of Commerce. Among other things, she brought legal training and a legal perspective to the appeal tribunal. As a result, none of the appeal tribunalís decisions on this chairís watch were overturned by the courts. Now the tribunal may be in a position of having to pay extra to get that legal perspective when it comes to writing a decision. Can the minister tell us how much more it will cost the system to obtain the expertise needed to write the decisions that will withstand potential court challenges, and how does he justify that extra expense?
Hon. Mr. Jenkins: Mr. Speaker, from memory of the chair of the tribunal last fiscal period, the per diems that were provided were in excess of $40,000 for that individual for the role that was played in her capacity as chair of that tribunal. As far as Iím aware, Mr. Speaker, all the names of all the candidates put forward were very reputable members of the Yukon community, and all were of equal stature here in Yukon.
Mr. Cardiff: Well, I would remind the minister that itís the injured workers who need the representation, and the minister has made no bones about the fact that he wants a more employer-friendly workersí compensation process. Earlier this year, the boardís employer consultant criticized the appeal tribunal for ruling in favour of injured workers too often. He has been quoted as saying the success rate for workersí appeals ó
Some Hon. Member: Point of order, Mr. Speaker.
Point of order
Speaker:The Member for Klondike, on a point of order.
Hon. Mr. Jenkins: Mr. Speaker, the member opposite, pursuant to section 19(g) of the Standing Orders, is imputing false or unavowed motives on my part.
Speaker: The Member for Kluane, on the point of order.
Mr. McRobb: On the point of order, Mr. Speaker, I would submit there is no point of order. The member is not imputing falsehoods on anybodyís behalf.
Speaker:I am ready to rule on this issue.
I believe that the member was imputing motives and Iíd ask that he not do that, please. Carry on with the question.
Mr. Cardiff: The employer consultant has been quoted as saying that the success rate for workersí appeals should be closer to 60 percent than the 90-percent rate since the tribunal was established.
Does the minister agree with that quota approach to appeals and, if so, what role did that business-friendly perspective have on his decision not to reappoint an experienced, dedicated, highly qualified chair to the appeal tribunal?
Hon. Mr. Jenkins: Mr. Speaker, our role as a government is to ensure that the Workersí Compensation Health and Safety Board functions in the correct manner, and that is to ensure that anyone injured while on the job is treated fairly, very quickly, and either is compensated for their injury, their medical conditions and costs are addressed and they are rehabilitated into the workforce, or, if their injury is of a nature that they can no longer work, they receive the appropriate compensation until retirement age.
We are firmly entrenched in believing in the Meredith Principles in our government. We are not deviating from that. What is missing from the member oppositeís whole scenario or overview is the fact that the people who are currently missing out are the injured workers. If anything, we want to see that changed and see injured workers treated quickly, fairly and as expeditiously as possible to be either rehabilitated or compensated for their injury.
Question re: Cabinet staff job classifications
Ms. Duncan:Mr. Speaker, early in the governmentís mandate, the advantages of the Yukon Party membership were very clear. There were sole-sourced contracts to former candidates that had no product, key appointments and pay raises for their top political staff. It is kind of like having a particular credit card ó membership has its privileges.
My question is for the Premier. I have raised the issue of $20,000 pay increases for the chief of staff and the principal secretary in the Cabinet office. The Premier said in this House that "due process" was followed when this big pay increase was handed out. That due process usually involves the Public Service Commission.
Was the Public Service Commission involved in this decision to reclassify the jobs for the chief of staff and the principal secretary?
Hon. Mr. Fentie: Well, the member opposite knows that the answer to that question is in regard to a private firm that has been solicited on many occasions by government to provide job classifications and job descriptions to the Public Service Commission so that they then can dictate what will be the payscales. In this particular example, that is exactly what happened. A firm was contracted to provide job descriptions and classifications, and the Public Service Commission ensured that everything that came forward was indeed ó in terms of dealing with the act, as far as the payscale ó exactly as the act lays out.
This is not a case of us giving a raise to anybody. This is a case of the Public Service Commission determining from job classifications that all those things that came forward from the contractor conform to the act. Thatís what took place, Mr. Speaker.
Speaker:The Chair is uncomfortable with the preamble to the previous question posed by the leader of the third party in that it was suggesting that the member is representing someone other than his constituents. I would ask that she not do that, please.
Ms. Duncan: Thank you, Mr. Speaker. The Premier just said that due process was followed when the reclassification decision was made providing raises for two political advisors. He said the Public Service Commission was involved.
Well, Mr. Speaker, I filed an access to information request with the Public Service Commission, asking for a copy of the reclassification for the chief of staff and any letters from the transition team or the Premierís office. This would be proof that the Public Service Commission was involved. The answer I received was that no records were found. In other words, the Public Service Commission was not involved in any way in this decision. It seems to have been handled entirely by the Premierís office, which is not due process.
The proof is in this access to information request that the Public Service Commission was not involved. Will the Premier outline for the House why he did not follow the rules, as he just stated he did?
Hon. Mr. Fentie: Again, the member opposite ó the former Premier ó is implying that we did not follow the rules. The facts are that we did follow the rules. A contract was let to provide job descriptions for the principal secretary, chief of staff and communications advisor. Those job descriptions and classifications were presented to the Public Service Commission so they could determine that they fell within the act, which states, "The positions shall be classified and shall have payscales assigned to them in conformity with the same criteria that would be applied if the positions were established in the public service under the Public Service Act." It is not we, the government elected officials, who determine that; it would be the Public Service Commission, which is in charge of ensuring that detail is, in fact, adhered to.
Ms. Duncan: Mr. Speaker, the detail is that for a reclassification decision, the Public Service Commission is involved. The Premier said that for this reclassification decision, the Public Service Commission was involved. Under the Access to Information and Protection of Privacy Act, the request I filed with the Public Service Commission for this information came back saying that the Public Service Commission has no records relating to a reclassification decision for the positions of chief of staff, Executive Council Office, principal secretary, et cetera.
Now, the Premier is saying ó and has said inside the House and outside the House ó that the Public Service Commission was involved. The Public Service Commission has said no, they werenít. Mr. Speaker, the Premier needs to correct the record. The Premier needs to outline the real story for this House, the public record and the record in the media. What is the ó
Speaker: Order please. Will the member ask a question, please.
Ms. Duncan: Certainly.
Will the Premier correct the record and tell the whole story?
Hon. Mr. Fentie: Whatís to correct, Mr. Speaker? The process was embarked upon to create job descriptions and classifications. These processes are related to the Cabinet and Caucus Employees Act and must also conform to the Public Service Act in terms of the payscale. Of course the Public Service Commission would have to provide that advice. We, as an elected body, donít make those decisions. We donít know what that payscale is. Thatís why the Public Service Commission is there ó to provide the necessary advice in these areas.
So letís recap. A private contractor established job descriptions and classifications. Those job descriptions and classifications are paid based on what is in the acts themselves and the payscale. Itís the classifications and the descriptions that dictate the payscale. The full story is that we follow process. The member opposite obviously has her own opinion.
Question re: Workersí Compensation Health and Safety Board appointments
Mr. Cardiff:I have some more questions for the minister responsible for the Workers' Compensation Health and Safety Board.
On April 3, the minister received a hand-delivered letter from the president of the Yukon Employees Union, local Y010, which represents about 1,500 government employees. In that letter, the union expressed its opposition to the ministerís choice for Workers' Compensation Health and Safety Board chair and expressed their confidence in promoting the alternate chair to the position of Workers' Compensation Health and Safety Board chair.
Will the minister now revoke that appointment and do the proper consultation, as suggested in the motion I tabled yesterday?
Hon. Mr. Jenkins: Here we go again. What the member opposite is asking me to do is conduct an election. The act is very specific as to the role and the rules that I have to follow. They have been completely adhered to and followed to a T. All that the member opposite has to do is examine the act to make that determination. He knows full well that that is very much the situation.
As far as revoking the appointments, I am sorry, the short answer is no, I will not.
Mr. Cardiff: I am not asking the minister to conduct an election. All I am asking him to do is listen to what the stakeholders in the Workers' Compensation Act process have been asking him and have been suggesting to him ó that the process needs to change.
In this same letter, the union expressed concerns regarding the possibility that YTG may pull out of the Workers' Compensation Health and Safety Board, concerned about the potential impact that this could have on the continued employment of employees at the Workers' Compensation Health and Safety Board.
Will the minister ensure that staff jobs at the Workers' Compensation Health and Safety Board arenít in jeopardy because of his plans to remake the Workers' Compensation Health and Safety Board?
Hon. Mr. Jenkins: Mr. Speaker, the determination as to how the Workers' Compensation Health and Safety Board is operated and conducts its business is not within my mandate as minister. That is an act ó the board conducting and overseeing the affairs of the board. Thatís where this task rests. They have a budget thatís presented to them. They either approve it or do not approve it. So the question that the member opposite is directing to me is directed to the wrong individual, Mr. Speaker.
Mr. Cardiff: Well, Iíd remind the minister that heís the one who is ultimately responsible. The Yukon Employees Union is only one of several groups expressing concern about what this minister has in store for the Workers' Compensation Health and Safety Board. A lot of those concerns revolve around the possibility that the Yukon government might pull out and either become self-insuring or sign on with another jurisdiction.
And before the minister tries a lateral hand-off to the minister responsible for the Public Service Commission, I want to stress that the bottom line of the Workers' Compensation Health and Safety Board is his responsibility.
What studies has this minister considered in coming to the conclusion that YTG pulling out of the Workers' Compensation Health and Safety Board would not adversely affect the boardís financial position?
Hon. Mr. Jenkins: Mr. Speaker, the whole issue as to whether Government of Yukon is in Workers' Compensation Health and Safety Board or out of Workers' Compensation Health and Safety Board is not something that is decided by the minister responsible for the Workers' Compensation Health and Safety Board. Itís an area that will be brought forward to Cabinet, but, Mr. Speaker, I canít answer the question because the question hasnít been raised. So until such time as it comes forward, there isnít a response to the question.
Question re: Family and childrenís services, budget cuts
Mr. Fairclough:My question is for the Minister of Health and Social Services. The Child Welfare League report was commissioned as part of a two-stage study of conditions facing children in care in the Yukon. The ministerís statistics in the budget show we can expect an increase of five percent in the number of children in permanent care, and temporary care will also increase by five percent. It is not in the best interests of children or families to have children in care longer than absolutely necessary.
What has the minister done to reduce the length of time children remain wards of the director of family and childrenís services branch?
Hon. Mr. Jenkins: I certainly have to agree with the member opposite that the last thing we want to do is take children into care and keep them there for any length of time. What we have is a very serious problem here in the Yukon, and the solutions must be family-based and must involve First Nation communities. Thatís where the main problem stems from ó the majority of children taken into care are First Nation. Our government will work with the First Nations to find a solution to this issue. It is a very serious one; itís one we recognize, and itís one we will be dealing with and currently are dealing with, Mr. Speaker.
Mr. Fairclough: Social workers must be in close contact with children in care of the family and childrenís services branch. They must also be in touch with their families, the foster homes and group homes on a regular basis to fill plans of care. Can the minister confirm that professional visits to government-run group homes and receiving homes arenít being made regularly because of the impossible caseloads social workers are being asked to take on?
Hon. Mr. Jenkins: No, I canít confirm that, Mr. Speaker. Iím not familiar with the minute details of the ongoing involvement of the department.
Mr. Fairclough: Mr. Speaker, Iím quite surprised at the ministerís answer on that. On one hand, he says thereís a serious problem and theyíre doing things to correct it and, on the other hand, he hasnít looked into the details. We must face the facts. The inevitable will happen. Some tragedy will occur, if it hasnít already, to a child in this governmentís care, as it has in many provinces. Weíve all heard stories of overloaded social workers making careless errors in judgement, resulting in the injury or even death of a child in care.
Is the minister prepared to accept the legal liability for any government social worker who couldnít perform his or her professional duties fully because of inadequate resources and support, and of being overworked?
Hon. Mr. Jenkins: Mr. Speaker, government currently has the liability associated with children in care. Thatís a given. Thatís spelled out in the act. Thereís a tremendous amount of responsibility assumed by government when they apprehend and take a child into care. We must deal with the immediate problem of children in care, and we must also at the same time pay long-term attention to the issues. Thereís an issue surrounding the act, the Childrenís Act, which must be amended. The rules here in the Yukon must be brought more into line to address the issue of the First Nation members of our community, who are the main people involved in child apprehension cases.
I guess, to spell it out very, very succinctly so that we all understand, the white man law is not working for our First Nation members here in the Yukon, and weíre going to have to dovetail our laws and our rules into the community, the First Nation community, and allow us to go forward in lockstep. We all know it but no one has been brave enough to face up and spell it out in the manner in which it should be spelled out. We have a very serious problem in this area. We are going to have to change the legislation but, at the same time, weíre going to have to have a lot of input from the First Nation members of our community on this issue.
Question re: Family and childrenís services, budget cuts
Mr. Fairclough:My question is again to the Minister of Health and Social Services. Yesterday the minister admitted to high staff turnover in family and childrenís services. He said it was a very serious problem. He also suggested that there were some very serious problems in childrenís services in the Government of Yukon. He said, and I quote, Mr. Speaker, "Itís a sad part of society here that a majority, or a great number, of the individuals in care are First NationsÖ." The minister quite freely brought out and singled out First Nations. The Child Welfare League of Canada report includes both First Nation and non-First Nation children.
While we wait for a new Childrenís Act, which could take years, what is the minister doing to ensure that the Yukon government has the capacity to do its job in the interim for both First Nation and non-First Nation children?
Hon. Mr. Jenkins: Mr. Speaker, we have a short-term need and a long-term need. The long-term needs I spelled out. In the short term, weíre looking at the conversion of existing overtime costs to auxiliary staffing. Weíre spending a lot in that area, and thatís a way that we can address the need in the short term. But down the road, weíre going to have to come to a more cooperative understanding with the First Nations that are involved in this issue, because it is not just staffing. Itís the whole approach to children in care, Mr. Speaker.
Mr. Fairclough: Mr. Speaker, this minister seems to believe that the Child Welfare League of Canada report excludes First Nations. Heís wrong on that. He also suggested yesterday that many social workers are being underutilized. Thatís the direct opposite of what the Child Welfare League reported. The fact is that social workers are overworked and they are stressed.
I would like to ask the minister this: exactly how many Yukon government social workers does the minister believe arenít being used to capacity? Is it 50 percent? Is it 75 percent? Is it 25 percent? Can he tell us?
Hon. Mr. Jenkins: Let me share with the House and the member opposite an area that our department is responsible for that is well underutilitzed: the young offenders facility. It has a capacity of 20. Normally there are between one or two individuals in there ó occasionally, three. There are two social workers, there are school teachers, there are cooks, there are custodial workers. There is an example of the underutilization specifically of social workers.
Mr. Fairclough: It is amazing that this minister seems to possess such expertise after being responsible for that department for such a short time.
He also said that some social workers are underutilized and they need to be moved around in the department. The minister should quit picking on the social workers and start doing his own job to capacity. He should focus on the very serious problem that he admits to. He said that a new approach is needed to address First Nation children in care.
Is the minister suggesting that no child protection cases involving First Nation children should go to court so that he can save money on social workers? Is that part of his new plan?
Hon. Mr. Jenkins: I consider that to be very much a stretch of the situation. Now, the issue is that the social workers should be dealing with the family unit and making every effort to resolve the situation with child custody in a family environment.
At times these issues have to go to the courts, but they donít have to go there virtually 100 percent of the time. They do end up there from time to time and they will continue to end up there from time to time. But letís make every effort to resolve these issues before we take them to the courts. If it is a custody order, arrangements can be worked out and the courts can ratify it, rather than this back and forth see-saw as to making the determination and the judge having to rule on an issue where, in a large part, arrangements could have been made before it even entered the courts.
So there is a lot of stress involved in this process. We have to take a new approach as a government and we will be taking a new approach.
Speaker: The time for Question Period has now elapsed.
Notice of opposition private membersí business
Ms. Duncan:Mr. Speaker, pursuant to Standing Order 14.2(3), Iíd like to identify the items standing in the name of the third party to be called on Wednesday, April 9, 2003. They are Motion No. 65 and Motion No. 8.
Mr. McRobb: Pursuant to Standing Order 14.2(3), I would like to identify the items standing in the name of the official opposition to be called on Wednesday, April 9, 2003. They are Motion No. 46, standing in the name of the Member for Whitehorse Centre.
Speaker: We will now proceed to Orders of the Day.
ORDERS OF THE DAY
Hon. Mr. Jenkins:I move that the Speaker do now leave the Chair and that the House resolve into Committee of the Whole.
Speaker: It has been moved by the government House leader that the Speaker do now leave the Chair and that the House resolve into Committee of the Whole.
Motion agreed to
Speaker leaves the Chair
COMMITTEE OF THE WHOLE
Chair:Order please. Committee of the Whole will now come to order. The matter before the Committee is Bill No. 4, First Appropriation Act, 2003-04.
Do members wish a 15-minute recess?
Some Hon. Members: Agreed.
Chair: Weíll stand in recess for 15 minutes.
Chair: Committee of the Whole will come to order. We will continue in general debate on Bill No. 4, First Appropriation Act, 2003-04.
Bill No. 4 ó First Appropriation Act, 2003-04 ó continued
Hon. Mr. Fentie:When we left off the other day in debate with the leader of the official opposition, we were discussing this yearís budget, the fact that it is the third highest budget in the history of the Yukon Territory, and itís a budget that takes the steps to address what is a serious problem in the Yukon, and thatís the inability for government to sustain the spending that governments in the past have been doing in terms of the amount of money that they have allocated and spent, when you relate that to the revenues coming in. In short, the governments in the past have been spending far more than what we were earning or bringing in, and the trajectory of that has put us in the situation in which we find ourselves today.
This budget takes the first step to address that inability for government to sustain the level of spending that has been going on in this territory for a number of years.
Weíve pointed out clearly how thatís reflected in terms of trajectory in going as far back as fiscal year 1997-98 and following through to this fiscal year of 2003-04. Itís easy to see, just by looking at the numbers, how that increase in spending has impacted the territory, and the results that weíve achieved from that increase in spending are, simply put, more dependence on government, less involvement of the private sector, a continuing exodus of our population, an ever-increasing contribution to economic generator dollars from the government side and an ever-decreasing contribution of economic generator dollars from the private sector. That has led us to the position weíre in.
So this budget, Mr. Chair, takes the first step toward addressing that very difficult situation. We could have done like other jurisdictions faced with this same issue, being in the same position. Those close to our territory, such as Alaska and British Columbia, chose to make massive cuts in their budgeting. Those massive cuts resulted in thousands of lost jobs across their jurisdictions. We, on the other hand, chose a much gentler approach. Just a very gentle, downward pressure on spending has brought us to where we are in this fiscal year in terms of annual deficit. We have decreased the annual deficit from some $56 million for the Liberalsí last fiscal year of 2002-03 to $13 million for our first fiscal year, this budget of 2003-04.
Thatís the gentle, downward pressure on government spending. Thatís the first step to managing the trajectory of spending and changing the course of this territory.
Further to that, Mr. Chair, we have to be very conscious and cognizant of the fact that the loss in population will result in more problems in the governmentís ability to maintain or sustain spending levels. The loss in population will result in a decrease in transfer payments from Ottawa, because it is fundamentally based on population. With the loss weíve experienced ó and without having the hard numbers here before me, we can safely say itís in the neighbourhood of 3,000 people ó we will experience a significant cut in transfer payments, and that will further compound the problem we face in governmentís ability to sustain the spending levels we have been accustomed to.
We have set aside some $15 million for this eventuality; however, we donít know for sure whether that will cover the reduction in transfer payments that we, in the Yukon, will soon experience when it comes to monies that flow from Ottawa. So we have to take the steps that we have taken in this budget to ensure that all options are before us and that we do not get into a fiscal situation that would require us to make massive cuts, as other jurisdictions like B.C. and Alaska have, and/or put the Yukon into an accumulated deficit position, which is against the Yukon Taxpayer Protection Act.
This step is a step taken out of the firm commitment to maintain spending in areas that are very important to Yukoners. Itís a step toward focusing some resources in the highest priority areas such as formalizing our relationship with First Nations. Obviously, whatís going on today in the corporate world is a prime example of why we, as a government, must take those steps.
The corporate world clearly sees the fact that we can no longer develop resources in our emerging economies and other sectors of our economy without involving the First Nation people in meaningful partnerships. That is why we are contributing resources toward that, whether it be the formalization of our government relationship here in the Yukon with First Nation governments and the Yukon government, or a full economic partnership, where government decision making is a collaboration between our government and the First Nation governments in terms of economic development.
We are setting in motion a process that is in lockstep with what is happening around us in todayís Canada. The Northwest Territories has been very successful in this area. The result is a tremendous amount of investment, including the federal government working diligently with the territories on a pipeline. Itís whatís lacking here ó that relationship with First Nations ó and we intend to change that and improve on it and ensure that the Yukon is not left out but, indeed, is being provided its fair share of corporate investment and federal government investment in developing our economy in partnership with our First Nations.
Now, the opposition parties have made much about slash-and-burn budgeting, but obviously, given the fact that this is the third highest budget in the history of the Yukon, that approach to the debate cannot be sustained. Thereís no way that the opposition parties can provide the burden of proof that this is a slash-and-burn budget. All you have to do is look at the numbers, the values themselves, and it will clearly indicate that this is far from that.
This is a very thoughtful approach to managing a difficult fiscal situation. It is unfortunate that the Liberal government, upon taking office ó who were faced with the very same warnings by officials who were well aware of the situation that the Yukon was getting itself into ó ignored those warnings and, in fact, in a manner that was unheard of in this territory, dramatically increased government spending.
Some Hon. Member: Point of order.
Point of order
Chair:Mr. McRobb, on a point of order.
Mr. McRobb: On a point of order, Mr. Chair, I think we have had enough of the political grandstanding. We all agree we have a major budget in front of us, and it is time to get down to working ó
Chair:Order please. Would the member cite the Standing Order in violation?
There is no point of order. We have a dispute among members here.
Hon. Mr. Fentie: I can assure the Member for Kluane that the camera was rolling when he was up on his point of order.
Now, Mr. Chair, we want to proceed here, of course, with constructive debate. We know that the official opposition has shown on many occasions in this House their willingness to contribute to constructive debate, and I look forward to their comments.
But, again, I want to just close out on what I was saying in regard to what has happened when the former Liberal government chose to ignore those warnings and really put the Yukon in a very difficult, if not desperate, fiscal situation. The former Liberal government had a number of choices in regard to how to deal with it. Their choice was to dramatically increase the spending in this territory ó unheard of increases in spending by any government in the history of the Yukon Territory. Those dramatic increases have resulted in what, Mr. Chair?
Some Hon. Member: Point of order.
Point of order
Chair:Ms. Duncan, on a point of order.
Ms. Duncan: Mr. Chair, on a point of order, there was a Speakerís ruling very recently with respect to casting aspersions on former members of the Legislature. It was with respect to discussions around the United Keno Hill/Elsa mine. There was discussion and an allegation that a previous member had done something, and the Finance minister is making an allegation that a previous government had done something. I would suggest that that is not in order in this debate.
Some Hon. Member: (Inaudible)
Chair: Mr. Fentie, on the point of order.
Hon. Mr. Fentie: Iím only reflecting what is factual numbers ó that the increases in spending in two years ó the fiscal year 2001-02 and 2002-03 ó were dramatically higher than any other expenditure by any other former government. Those are the facts.
Chair:Order please. The Chair finds that there is no point of order here. There is simply a dispute among members. Itís not the Chairís place to rule on the facts.
Hon. Mr. Fentie: Getting back to what I was saying, Mr. Chair, those two years really put the Yukon Territory into the fiscal position it finds itself in today, when the former Liberal government did have the options available to it with the very same warnings from the officials who were clear that this spending cannot be sustained.
Mr. Chair, let us go on from where weíre at today. This Yukon Party governmentís first budget is a budget to simply lower the trajectory of spending so that we can get within the fiscal restraints that we face to ensure that we do not result in an accumulated deficit position from government spending, and thatís important. But thereís more to it. Itís a fact that governments must realize that balanced budgeting is important. Not only is it important to the taxpayer, but itís an important message to the corporate world that we are a jurisdiction that has a government that understands that there has to be a measure of balance in terms of ó
Some Hon. Member: Point of order.
Point of order
Chair:Mr. McRobb, on a point of order.
Mr. McRobb: Point of order, Mr. Chair. I draw your attention to section 19(b)(i) of the Standing Orders that says a member shall be called to order by the Speaker if that member speaks to other matters than the question under discussion. I draw your attention to the question that was posed to the government. It is in the April 7 edition of the Blues, on page 665. The question was this: "Öis this part of the deliberations that may happen under Economic Development and, if so, are there other areas the Yukon Party government has in mind that it would task the Economic Development department with?"
Itís very clear ó hereís my argument ó that the Premier has opened the issue to much larger issues ó
Chair: Order please.
Some Hon. Member: On the point of order, Mr. Chair.
Chair: Mr. Fentie, on the point of order.
Hon. Mr. Fentie: We are in general debate on the budget. Itís customary during general debate for the government ó at least our governmentís view ó to lay out what the plan is for this budget in general terms, and thatís all Iím doing, Mr. Chair.
Chair:Order please. The Chair finds that, under general debate, members may speak to that matter of general debate. The matter of debate, the question under discussion, is general debate on the First Appropriation Act, 2003-04, and the member is speaking to that. There is no point of order. Please continue.
Hon. Mr. Fentie: I thank you, Mr. Chair.
As I was saying, this budget not only puts a downward pressure on the spending of government to ensure that we do not get into an accumulated deficit position, but it also reflects the fact that, on the best available information and data that we have, in the long term, we will have a balanced budget. So just let me quickly reflect on that.
Weíve gone from last yearís budgeting of an annual deficit of $56 million to this yearís projected annual deficit of some $13 million. As we carry forward over the next three years with all that available information that we have ó itís the best possible information that we have available to date, Mr. Chair ó we are heading, as far as the Yukonís fiscal situation is concerned, toward an annual surplus, not an annual deficit. That alone, Mr. Chair, puts us in much better positions fiscally when it comes to the overall accumulated surplus position, and it increases the options that government has available to it in spending and in budgeting that will address, I think, in a much more efficient manner ó at least our government believes so ó the issues that are important to Yukoners, whether it be program service or delivery or whether it would be the development of an economy.
So in providing a clear picture that this territory is heading to balanced budgeting and opening up its options with more available surplus to it, we send a clear signal to the corporate world that the Yukon Territory recognizes what must take place, first by government; and secondly, we as a government understand that we need the corporate world involved in our territory, with their large pools of capital investment, availability, and we feel that that is the way to counter the fiscal position that the Yukon finds itself in. Injection from the private sector is critical to actually developing an economy. Government cannot spend its way out of economic problems, and I think the former Liberal government proved that out.
Its massive increases over two years in spending did nothing to get us out of the economic downturn we were in. Actually, it contributed to a greater exodus of people and a further depression of our economy and a further increase in dependence on government and a further decrease in the contribution that the private sector makes to the economic generator dollars ó a factor that is so important to spending power in any jurisdiction.
We are taking steps first and foremost in this budget to address our First Nation governments in this territory. Itís vital that we remove the barriers between us. Thirty years of land claim negotiations have resulted in some of those barriers not being dealt with. Until we do so, we will still have difficulties in developing our resources, for example.
So by removing those barriers and providing a more cost-effective form of government, we can, again, contribute to the overall trajectory of lowering government spending and at the same time increasing our contribution from the private sector.
What is really important here is when we look at the issue of full economic partnerships with our First Nation governments and our First Nation people. That alone will contribute to a comfortable investment climate. That alone will lend greatly to restoring investor confidence in the Yukon Territory. This territory is blessed with an abundance of natural resources and other things that are required in terms of developing an economy. That is one of the first steps we must make. Developing our resources will take us toward a renewal in our economic situation in this territory, and it will set in place the foundations for rebuilding our devastated economy, which has been neglected by past governments by their focus on government spending versus utilizing the assets and the resources we have to engage the private sector, the corporate world, and have them contribute a much larger share to what happens in the territory today and into the future.
In developing our resource, we can realize vast amounts of capital investment, which will result in a great deal of job creation ó job creation by the hundreds.
Though the territorial governmentís revenue comes from many sectors, one of the biggest portions or percentages of that revenue comes from personal tax, so the more jobs that we can create, the more revenue the government earns. More important, the spending power in the territory increases.
Employed people spend a lot of money. That is the key to economic generator dollars and/or cash flow. We need to see a much larger share of those economic generator dollars flowing from the private sector. It is that thing alone that will help to turn our economy around and allow government to focus its spending in areas that are important to Yukoners, and itís where government should focus its spending.
We need to address the social ills. We need to address the health care issues. We need to address housing and all other kinds of areas that are critical. But as long as the spending trajectory was to continue as in past governments, it would be impossible, in the very near future, to really effectively address any of those.
We are lowering the spending to the third highest budget in the history of the Yukon. We are working to engage the private sector and the corporate world to come into the Yukon and help offset government spending in areas that, simply, the government should not be in, especially in the private sector, and we couple the two, along with our First Nation partners ó
Chair: The member has two minutes.
Hon. Mr. Fentie: Thank you, Mr. Chair.
We will see a new direction for this territory, a new direction that is simply laid out, the beginnings of that direction simply laid out by this first budget by a Yukon Party government.
I thank you, Mr. Chair.
Mr. Hardy: Itís once again very nice to hear the same story told over and over. Unfortunately, in this case the repeated telling of the story hasnít got any better, nor has it got any more reliable in its accuracy.
For instance ó and Iím going to go over a few things that this Premier has said ó he talked about the revenue going down and thatís an interesting position to take, considering that in front of me I have the Government of Yukon projections, and under "income" it has 2002-03 projected actual, 2003-04, 2004-05 and so on and so forth, up to 2006-07, and it shows a territorial revenue for 2002-03 of $69,700,000, $72,700,000 for 2003-04, $75,300,000 for 2004-05, and so on and so forth again. Then we go down to the transfers from Canada and the projections indicate for 2002-03 the amount of $347 million jumping to $359,800,000 in 2003-04, and then $366,600,000 for 2004-05, $377,600,000 for 2005-2006, and then $391,500,000 for 2006-07 ó close to a $50-million increase over four years.
Now, this Premier across the way has just told us the revenue is going down. The total net income over these four years ó $438,800,000, $454,500,000, $463,800,000 and $476,500,000 for 2005-06 ó by the time we get to 2006-07, weíre at $490 million, a $50-million increase. Now, these are projections, and my understanding is the Premier, who relies very heavily on the Finance department, would be relying on these projections as well. Thereís no doubt. Iím sure Iím going to get an explanation about these. However, they are in the book. Theyíre laid out in front of us. If thereís an explanation why these figures would show an increase or no increase, I would be very interested to hear the spin on this one.
As well, the Premier ó who has a tendency to go on and on and on and then run out of words, so he repeats the same story over and over during the course of 20 minutes ó has mentioned that more jobs created will create more tax. Heís correct. There is no argument from this side. If we have more people employed, there will be a greater tax base and, hopefully, there will be a return of people who have left the territory, as well as growth in the territory, instead of the continually shrinking territory that we are experiencing and which has not turned around since this Yukon Party government came into play. Nor has there been an increase in building permits, nor has there been an increase in activity out there since this government was elected, although they promised instant and immediate changes. We havenít seen it yet.
Going back to more jobs create more tax ó thatís true, unless this government continues to give million-dollar tax relief as they did last week. If the Yukon Party government identifies a tax base and gives it away, there wonít be an increase in tax and there wonít be an increase in revenue from that source.
So, the Premier canít have both ó as one of his favourite sayings is, "on one hand, and then on the other hand". He canít say thereís going to be an increase in tax and yet give the tax away if he needs the tax, because the whole argument of this budget since it was tabled has been that the Liberal government put the territory in a huge deficit. Thatís the whole argument and the whole basis of this whole budget. For every action taken in this budget, thatís the basis, thatís the line, thatís what theyíre going to repeat over and over, Mr. Chair.
Now, Iím not here to defend the Liberalsí actions, and I wonít defend the Liberalsí actions. I also have some misgivings about what happened over the last two and a half years, but I do remember that this Premier said he would not use that as an excuse ó he would not use an excuse that has been used time and time again whenever a new government comes in, which is to find the deficit, create the deficit by bookings, by moving money around, and then use that to justify your actions in the budget, or justify your actions for the next year.
Now, he said this after he was sworn in. I remember it very clearly. However, here we are today, and all we hear is how itís the Liberalsí fault they had to bring in this budget, which doesnít sound like theyíre very proud of it because they constantly use the Liberals as the excuse for some of the cuts theyíve had to make.
So, whatís it going to be? Are we going to move on? Are we going to debate the budget? Are we going to say ó from my perspective, I would rather hear the Yukon Party say, "Weíre proud of this budget. This is the direction weíre going in. We donít care about what the Liberals did before. We understand. We have some issues we have to deal with and that they may have been a cause of, but we are setting our own course and weíre not using them as an excuse, Mr. Chair." I would much prefer to hear that. I much prefer to debate this budget based on those merits. However, itís not happening.
So, just to facilitate quicker debate so that we can move forward and get into departments, I have some questions to ask. Iím not going to spend a lot of time on them. Hopefully, Iíll get the answers. If I donít get the answers, which seems to be the pattern that weíve been facing over the last while, so be it. At least the questions will be out there, and maybe we can get the answers some other way.
Going back to yesterday, when I did have a question around the Economic Development department that they planned to create or re-establish, I guess ó Iíll start with that one. My understanding is that the loan collections were transferred from the previous Economic Development to Finance, and my question is: are they going to go back to Economic Development or are they going to stay in Finance?
Hon. Mr. Fentie: Mr. Chair, that was quite a distance travelled to get to that one question. I think I have to just clarify a few things.
First off, we are very proud of this budget. We commended it to this House. No question about it. And the member opposite says he hasnít heard it, but itís certainly there in the pages of Hansard, and he may want to just reflect back in Hansard to confirm what we are saying.
Second, this is not about blaming anybody. This is laying out the history here so that it clearly shows everyone where we have come from and why we are in the position we are in today.
The member mentions revenue increasing; however, the problem with that is that the spending was far out-distancing any revenues that were coming in. What the member does not reflect on is that actually, with the loss of population this territory has experienced, our revenues have decreased some $30 million to $40 million if we had not lost that population. So if you think holistically, in the bigger picture, you will come immediately to the realization that the revenues for this territory have been declining for a number of years.
As far as the collections, the outstanding loans that were transferred under the misguided renewal process over to Finance, given the fact that we are now actively working with the department to find a way to resolve those outstanding problems that have been there for many governments in the past ó none of which chose to tackle this issue because it was probably too difficult, maybe, Mr. Chair ó we have no intention of moving those particular areas of collection from where they sit today in the Department of Finance.
Mr. Hardy: Well, obviously the government is quite generous in the fact that theyíve spent $1.25 million ó $1 million on tax relief, which may or may not have a good effect and may or may not benefit Yukon people; another $200,000 on a consultant; another $40,000 on two people in their staff. Thatís $1.25 million that was spent post-Liberals. Thatís a substantial amount of giveaway right away when you are talking about a difficult situation, but you can find that amount of money.
My next question is about how the government promised to reinstate the community development fund and the FireSmart to the original amounts. Why the change of mind? Why the change of heart? Why didnít they do it?
Hon. Mr. Fentie: We did do it, Mr. Chair. We injected some $3 million into the Yukon economy since January through FireSmart and the community development fund. We are now monitoring the situation because weíve closed out a fiscal year and weíre entering into a new fiscal year. Weíre monitoring the situation to see what lapses there are, and weíll make decisions accordingly.
The main point is that both those vehicles are very important to Yukoners because of the stimulus they create and the community well-being that results from that. But the member has some confusion around taxes and reduction of taxes and our comments about how important personal tax is to this territory, considering it generates 50 cents of every revenue dollar. We havenít cut personal taxes.
In terms of the mining issue, thatís not a tax. If assessment work is not done, thereís a penalty. So weíve given a year-long grace on assessment work. There is no cost there, again, to the government until you determine what assessment work hasnít been done, and then thereís a penalty charge. Itís certainly not a reduction in tax.
Mr. Chair, the community development fund and the FireSmart program are something that came out of the New Democrats. We recognize them as good programs, and we intend to carry through with them and carry forward with them because weíre committed to using those vehicles, those mechanisms, for short-term stimulus.
Mr. Hardy: The Premier didnít answer my question. I asked a very straightforward question of why they werenít reinstated to the original amounts, as was promised. As the Premier knows, we were in total support of allocating more money, and this government did allocate some more money but they never did all of it. Now, in this budget, it has been reduced way back from what the original amounts were and what was being spent when the NDP was in power, although the promise was very clear at the time.
My question was very simple: why the change of mind? Is the change of mind because there isnít enough money and they have to hold back in order to deal with the deficit? Is that the reason?
Hon. Mr. Fentie: Mr. Chair, Iíll repeat: there is no change of mind. We re-established the CDF and FireSmart to $3.5 million and $1.5 million respectively. We are now closing out a fiscal year. We managed to inject some $3 million through those two programs into the Yukon economy since January. There are a lot of communities out there that are very pleased with that as their citizens go to work today, as we speak.
We will monitor what happens in terms of lapses and revotes to make that assessment and judgement when we get there, but we intend to use these two programs in a manner that creates short-term stimulus, community well-being, and have certainly continued to honour our commitment with the two programs in question.
That should be sufficient for the member opposite. Weíll have to determine what lapses and revotes are available to make the next decision, Mr. Chair.
Mr. Hardy: Were they brought back to the original amount? Was that amount of money spent? Was it spent as was promised previous to this budget? Of course it wasnít, because we know about that ó it wasnít. There was $7-million worth of applications, supposedly, and they didnít spend up to the original amounts of the previous community development fund and FireSmart.
Has the same amount been allocated in this budget? Of course not. Will it be spent? Will they allocate more? Will they bring in a supplementary to meet the promise made to re-establish it at the original amounts?
However, I am not going to spend a lot of time on it. I think the point has been made from both sides. We have our different viewpoints on this. Let the record stand on where I am and where the Premier is on it.
Could the government tell me what its policy is on private/public partnerships?
Hon. Mr. Fentie: We did re-establish the community development fund and the FireSmart program to its original levels under the NDP government of 1996 to 2000. We have every intention to use those programs to continue the good works that they provide for the territory.
When it comes to P3s, we are going to look at all options available to this government to help rebuild and stimulate our economy. But everything we do must be within the confines of the Yukon Taxpayer Protection Act. That is why itís so important to engage the private sector for them to invest in the territory, especially when it comes to our abundance of resources and assets we have available.
As far as P3s, we have no specific government policy today but we are not going to ignore any possible option here that would help us rebuild our economy and ensure that we maintain budgeting within the confines of the Yukon Taxpayer Protection Act ó in other words, conform to the act.
Mr. Hardy: Could I assume that the Economic Development department will be the one that leads up any kind of negotiations or discussions with the private sector in regard to public/private partnerships?
Hon. Mr. Fentie: Mr. Chair, we are going to re-establish the Department of Economic Development. Thatís a given. We are now in the final stages of recruiting a deputy minister for that department. Thatís the most important step. Yes, in this particular area of public/private partnerships, that department would develop policies around this, but they would be of a sectoral nature. One never knows exactly what a P3 may entail, and it might be something that is focused more in another department. So to answer the memberís question, the Department of Economic Development would be the department that looks at the overall policy, but of course it could be of a sectoral nature.
Mr. Hardy: In looking at all options that the Premier has articulated in trying to attract the private sector back into the territory or try to stimulate it within the territory, the part that already exists here, would he be looking at the delivery of programs, running of facilities, stuff like that?
Hon. Mr. Fentie: Our government recognizes limitations. Thereís nothing we would ever do that would contravene the collective bargaining agreement.
Mr. Hardy: Thatís interesting, Mr. Chair, considering he said that this government is open to all options. Thereís no question about it that itís definitely one option. Maybe he can tell me what "all options" actually means now, since he has already restricted it again?
Hon. Mr. Fentie: Well, two things. I havenít restricted anything. We said weíd look at all options, and with that comes the fact that there are things that the government cannot do. One of them is we cannot contravene a collective bargaining agreement. So when looking at the options, for example, Mr. Chair, if that option would contravene the collective bargaining agreement, obviously it would not be an option the government would proceed with.
Mr. Hardy: Mr. Chair, Iíve spent many, many years bargaining for a variety of organizations and unions, and I can assure the Premier that, when you sit down to bargain, the agreement is open and thatís what youíre doing. I donít know if this government in their negotiations ó possibly not this time but obviously the negotiations that theyíll have to come into with their bargaining units within the next two or three years as they come up again, this may be something they would put on the table and look at all options. Sometimes thatís what you do. When you negotiate and bargain, you go to the table with a list of wishes or desires that you have, and this could possibly be one that this government might be interested in doing.
Would this government be interested in putting this on the table in their negotiations? Iím not saying Iím for it, but Iím curious if this is their mindset, recognizing when you negotiate that youíre trying to negotiate from your own perspective and if youíre trying to stimulate the private sector, Iím kind of curious: if they get direction from the private sector to go in this direction, would they bring that to the table?
Hon. Mr. Fentie: I think what we have here is an example of a situation where the member opposite is trying to imply that we may do something in an area that would affect the union, for example, and I have stated that there is nothing our government would do that would contravene a collective bargaining agreement. But, having said that, our government is not going to preclude options that may come forward. Weíre not going to ignore what possibilities are out there. We are going to do the necessary research and critique of any option that comes forward, always bearing in mind that there are restrictions we face, such as collective bargaining agreements, and that we are going to engage the private sector and the corporate world to assist us in rebuilding the Yukon economy.
Thereís nothing that stops us from doing that in resource development, for instance ó nothing whatsoever. Thereís nothing that would stop us in terms of finding ways to help small business. These areas are not things where we just ignore options because they may, through some speculative process, have impacts on contracts or agreements. Thatís the work you must do to ensure that youíre not ignoring a good option that will help and, by the same token, youíre not contravening such things as a collective bargaining agreement. You have to do the research.
Mr. Hardy: I just want to assure the member opposite that Iím not implying anything. These are just questions asked to try to get an understanding of the mindset of the Yukon Party government and the Premier himself. Truthfully, I was very polite about it.
I mentioned that, if they were planning on doing anything that might contravene the collective agreement or were thinking of going in that direction, they would use the proper channels, which would be through the negotiations that the government and the union would participate in.
Whatís the governmentís policy on public consultation?
Hon. Mr. Fentie: Let me first assure the member opposite that, under this Yukon Party government, collective bargaining is alive and well. Make no mistake about it. Negotiations are a great thing, and they can produce a lot.
As far as consultation, it comes in many forms. Thereís consultation here in this House. There are processes evolved around specific issues that a specific department will undertake to engage the public. There are the media, which is another form of connecting with the public. That is, to some degree, consultation. There are programs related to consultation that are specific, that we must undertake. When you look at the Umbrella Final Agreement, there are clear commitments on what government must do when it comes to consulting First Nations, so it can come in many forms. We will endeavour to consult with Yukoners, with agencies, with groups, with the First Nation governments on all fronts, but at the end of the day, it would be very hard to give the member opposite a long litany of how we intend to consult other than the fact that we will do so. Thatís what governments do and thatís what governments must do. In some cases, like the Umbrella Final Agreement, they are bound to do it. So there is no diminishing of the consultative processes from this government. We hope to even make them a little more efficient and produce more results.
Mr. Hardy: What role does the government see in the partnerships in the film industry? The stand-alone film commission ó is that a view this government has right now ó or is the financing of partnerships that are done throughout the country something that this government is looking at?
Hon. Mr. Fentie: In general debate I can say that this government is looking at the film industry as a whole, seeing it as a very important element of economic development for the territory. We feel we have a great deal to offer as a territory for the film industry, and partnerships are vital in all these areas. We are certainly looking at them.
The member opposite could get into much more detail on this one when we get into the department debates and the related department to the film industry.
Mr. Hardy: I always like to know what the leader has got up in his own mind. It is quite nice to tap into that mass, that huge resource there.
How about the securing of port access? That is a promise that was made ó Skagway, Haines, the Beaufort, I donít know; any ideas that the Premier has over there? Are there any partnerships or leases being negotiated at this time?
Hon. Mr. Fentie: Well, weíve had discussions. What was once a very valuable initiative under the former New Democratic government got lost, unfortunately. The Yukon had an opportunity to own access to tidewater. That didnít happen so we are, again, exploring our options.
We have had discussions. There may be a number of ways this can happen but, for the most part, it is important ó it is vital ó that the Yukon does not become landlocked.
I think back to many years ago when Faro was going to reopen and the long, hard negotiations that took place to get access to tidewater. So we felt that looking at our options and entering into dialogue as early as possible was important. That is what we are doing right now.
Mr. Hardy: Could the Premier ó thank you for the answer, or kind of answer, vague answer. How about another one? Could the minister give us an update on the Kaska court challenge, without breaking any confidences, as to where itís at, as we know weíre getting closer to the time and I know thereís money being spent by the Yukon Party government ó a substantial amount of money ó to have somebody work on this? Without breaking confidences, is there any kind of statement he can make regarding the ongoing negotiations around this?
Hon. Mr. Fentie: We committed to try to avert litigation. Litigation doesnít help anyone. In fact, itís a negative no matter how you look at it, so we committed to try to avert it. Itís important to realize, though, that this court challenge is not against Yukon. Itís against Canada. Itís not a question of a legality for Yukon. The importance here is that we try to expedite processes with out First Nation governments and First Nations that have unsettled claims or unfinished business in a manner in which we get results. With litigation hanging over our heads, there was no ability for us to get back to the land claim table, period. The federal government will not entertain any negotiations while the litigations are in effect, so we are trying to avert litigation.
But there is another important facet to this. We are very, very focused on attracting investment into the Yukon and providing a secure investment climate, restoring investor confidence. If we are on a major ó and Iím not saying the Yukon government, but if the territory itself is under a major litigation, it will damage our ability to attract that investment.
So itís actually two very important areas for us. We want to get back to the tables and conclude unfinished business. Second, we donít want to jeopardize, because of litigation, what may be in the short term a lot of very important investment for us in, for example, the resource sector.
Mr. Hardy: Obviously I wasnít going to get an answer. Maybe Iíll just repeat it again, see if there is a chance to get an answer, or if heís not going to answer it, so be it. Where is it at right now?
Hon. Mr. Fentie: As the member well knows, Mr. Chair, we donít negotiate in the Legislature. The time is short. Weíre in the negotiating process with the First Nation, and weíll see what transpires. But I tried to point out to the member opposite this is not against us. Itís against Canada. Weíre trying to use our good offices to solve a problem, and that problem is we want to conclude unfinished business. Without litigation being set into abeyance, thereís no way to get Canada back to the table, and we do not want to jeopardize or compromise what investment we could attract in such areas as resource development. So far, the negotiations have progressed, and weíll see where weíre at when the negotiations get to their inevitable end.
Mr. Hardy: It was only a couple of months ago that it was because of devolution; the reason this is happening now is because of investment. My, how time changes stories.
Years ago, then government leader Tony Penikett introduced a policy to have government pay interest on overdue accounts to small businesspeople. Is that still a practice?
Hon. Mr. Fentie: Well, just for the member oppositeís information, the challenge is in regard to devolution, but I would submit to the member opposite that devolution would be somewhat limited if you could not allocate third-party interests. That allocation of third party interests is what will generate investment. Yes, that policy continues in terms of interest being paid.
Mr. Hardy: What is the collection process for those who owe government, as of today? What is the collection process?
Hon. Mr. Fentie: There is a collection policy the government has in place. I could read it into the record if the member so desires. There are a number of areas to it. Firstly, statements are sent monthly to customers with a balance owing on their accounts. These statements state when payments are due ó thatís a given. Customers are phoned if their accounts are 20 days in arrears to inquire when payment will be made. A payment schedule may be negotiated if the customer is unable to pay the entire balance immediately. A certified letter is sent when the account is 30 days in arrears. The letter advises the customer that, if payment cannot be made within the next 30 days, to notify accounts receivable of the Department of Finance in order to arrange for a payment schedule.
If there is no response, Finance will use the right to set off on any amounts due to the account holder from the Government of Yukon, pursuant to section 35 of the Financial Administration Act. A small debts court action is considered where the balance owing is $5,000 or under and the debtor resides in the Yukon. Collection agencies are used for pursuing written-off accounts.
Then thereís an allowance for "doubtful" and a write-off process, but that basically outlines the policy for collections, so there are a number of stages.
Mr. Hardy: Could the Premier ensure I get a copy of that for my own records? Also, could he tell me when that policy was put in place?
Hon. Mr. Fentie: We will provide the leader of the official opposition a copy of the policy. It has been in place for quite some time. We can find out when it was first implemented, but it would be years back.
Mr. Hardy: I assume that the member will give me the information of when it was first put in place. Thank you.
I am just going to go through a couple of things more and I want to ensure that other people have a chance to speak. They are just things that kind of jump out at me.
The Yukon Party has talked a lot about access to resources, roads to resources ó that kind of stuff. I guess I would like to know what discussions have happened with regard to that, because I believe the road that they are talking about, from what Iíve read, is mostly in the southeast Yukon. What discussions have happened in the last four months in regard to that and is there any kind of idea of where it is going, how long it would be and what they foresee for when it would be developed?
Hon. Mr. Fentie: Of course there are many areas where roads to resources could come into play. But this particular item is something that has been around a long time, coming out to the southeast Yukon.
Resource development in the southeast Yukon will benefit all Yukoners. There is a misconception that somehow this is totally focused on the riding of Watson Lake, which is not the case. For example, in oil and gas right now, in terms of production in the southeast Yukon, hundreds of thousands of dollars accrue to every First Nation in the territory; added revenues to the Yukon government that reflect benefits to all Yukoners are part of that. So the purpose of a road to resources in the southeast Yukon is to help to open up resource development in the sector.
We have had discussions with First Nations, with the community of Watson Lake, with chambers of commerce. This is not a new discussion. It has been evolving for quite some time and our government is committed to deliver on that concept, though there could be many options on how it is done.
For example, itís not a necessity that government builds it. If we do the right thing in resource development, industry will build it. There are so many ways that this can be implemented, and we want to ensure that we proceed in a proper manner. Of course, itís all about the need to open up resource development for the benefit of all Yukon people and that, in southeast Yukon, will contribute greatly. This is not something that we created. This is something that is just a fact of nature. Southeast Yukon happens to harbour some of the richest regions there are, and itís much sought after by industry, whether it be oil and gas, forestry or mining. The bulk of the forest resources are situated in southeast Yukon so, to benefit all Yukoners, itís important that we start to develop some of those resources in the southeast.
Mr. Hardy: Iíd like to say to the Premier that, because I mentioned southeast Yukon does not mean I was implying that his interest happens to be greatest down there. I recognize what heís saying. When I talk about the road to resources, it has always pointed to that area so, of course, you connect the dots and thatís what weíre talking about ó southeast Yukon.
Whereís the most interest in resource development right now in the Yukon?
Hon. Mr. Fentie: Mr. Chair, it depends on what sector weíre talking about. Letís just look at oil and gas. Of course, there are interests in north Yukon, but the most interest in oil and gas is in the southeast for the simple reason that itís hooked to the marketplace. We have producing wells right now, with proven fields, and itís a very simple process to explore and develop and get the resource flowing to the marketplace and earn revenues in the short term, whereas other regions in this sector of oil and gas involve a much longer term process for revenues to start accruing. It would reflect whether the Mackenzie line gets built or whether the Alaska Highway line gets built. Itís a process of getting the resource to market.
As far as forestry, there are a number of areas that are important, whether it be in the Haines Junction area, the Teslin area or the southeast, again. In mining, I think thatís a given that thereís mining potential throughout the Yukon. So it depends on what sector the memberís talking about.
Mr. Hardy: Staying with the roads ó and Iím sure when we get to the departmental debates, the critics on this side will continue with some of these lines of questions. Just in general, to close up a little bit, I have a couple more. Iím just looking in the budget, and Iím looking at some of the promises made during the election. Thereís one that jumps out at me, and itís to continue efforts to make Kluane National Park more accessible to Yukoners and visitors. Could the Premier explain what he means by that statement?
Hon. Mr. Fentie: What that really means is that we have a jewel in the Yukon: Kluane National Park. Weíve experienced situations where access to that park by a certain entity would have provided benefits to Yukon. What weíre saying here is that, because of that asset we have, we should look to more access to it, in a responsible way, to provide benefits to Yukoners. I know the First Nations are really keen on that. Thatís why ó beyond the First Nations, but thatís why we want to see if there are ways that Kluane National Park can contribute to more benefits coming into the Yukon Territory. Itís certainly something that is world renowned, and I think we should utilize that a little more, in a responsible way, to provide benefits for all Yukoners.
Mr. Hardy: There is another area I am looking at, and Iím trying to connect the two documents I have in front of me. "Where feasible and economical, split government contracts to encourage bids for Yukon contractors," could the Premier explain how that would happen?
Hon. Mr. Fentie: One of the fundamental issues that all Yukon contractors face ó at least a large percentage of them ó is when contracts get to be a certain size, they have great difficulty in being able to participate. Smaller contracts provide Yukon contractors an access to government expenditures, because they donít have to come up with large bonding or insurances to be able to apply or tender for a contract.
So, I think much of it is about retained spending power, Mr. Chair.
Some Hon. Member: (Inaudible)
Hon. Mr. Fentie: Mr. Chair, maybe Iíll just wait for a moment.
Thank you, Mr. Chair. My point to the leader of the official opposition is, far too often, we experience government contracts going to firms where a great deal of the government money spent is an outflow, and thatís something we want to look at in terms of retained spending power for the territory. Of course weíre bound by contract regulations and restrictions and conditions, but it would be imprudent if a government didnít look at ways for contracting that would result in an increase of spending power and retained earnings here in the territory from the Yukon taxpayersí money being spent.
Mr. Hardy: I have just a couple more questions. There was a promise made, and I didnít see it in the budget, and I want to know when itís going to materialize, and that was the whistle-blower legislation. What work has been done in that area, and when can we expect to see a promise that was made?
Hon. Mr. Fentie: Governments cannot put together and implement everything in the first few months of a mandate. There is much work to do. There are a number of years left in this mandate, and I am sure that the minister responsible is looking into this issue as diligently as he possibly can.
Mr. Hardy: I want to assure the Premier opposite that I am looking into this issue as diligently as I can, especially in light of many of the issues that have surfaced over the last couple of months in regard to the employment with government.
But there was a promise made that was supposed to be immediate. I would like to know where the government is on it because it should have been reflected in the budget, or it should have been reflected in the budget speech anyway. I will read it to the member opposite: "Upon formation of government," which has happened, "strike an independent commission of citizens to hold public consultations on electoral reform in the Yukon." That doesnít sound like itís that onerous to start something like that. I am wondering why this Premier hasnít moved forward on that.
Hon. Mr. Fentie: Again, Mr. Chair, government cannot do everything all at once. Those commitments are there and we intend to carry out delivering on those commitments. There is a great deal of work that goes into a lot of these particular initiatives. They are just not going to happen just because we took office on December 2. They are going to take time to work on, work through, and develop something that is acceptable to Yukoners.
We are not here to dictate to Yukoners; we are here to work with them. That is why it takes time, Mr. Chair.
Mr. Hardy: This was a very obvious promise that was supposed to happen immediately. Weíve heard the excuse for many of the promises made that they may not even be happening over the next four years, but this is one that was, upon formation of government, pretty straightforward.
Actually, at this time, Iím going to step out of general debate and allow my colleague in the third party to ask some of the questions that she has. I really look forward to the departmental debates and the general debate on line-by-line items. I hope we have a very productive discussion in this House that allows us to get some answers to the questions we asked.
Thank you, Mr. Chair.
Ms. Duncan: Iíd like to focus our energies in general debate and go through some straight yes-or-no, straightforward questions with respect to the numbers with the Finance minister. Would the Finance minister agree that the estimated deficit as tabled in 2002Ė03 ó thatís the budget just completed, it was tabled and passed the House whenever we adjourned last spring ó the estimated deficit was $41,470,000, with revotes of $16,500 and lapses of $20,000, leaving a projected surplus at the time of tabling of $25,879,000. Does the Premier agree that those were the figures tabled and passed in the 2002Ė03 budget?
Hon. Mr. Fentie: Well, the member opposite should know. It was her governmentís budget. So without having all the detail in front of me, there are various numbers between estimates, projections and actuals, and I would suggest to the member opposite that we wait until the actuals come in so we can agree on what the number is. As far as her projections or our projections, those are items for debate, but they certainly would not warrant a firm answer that that is the exact value, because that can only be determined when the final accounting is done.
Ms. Duncan: Mr. Chair, I didnít ask about the final accounting. I asked the minister a very straightforward question, and he ought to know because he was a member in this House at that time as well. I asked what was tabled and passed by this House for the 2002-03 fiscal year.
The facts are that the estimated deficit as passed by the House was $41,470,000 with revotes of $16,500 and lapses of $20 million, with a projected surplus totalling $25,879,000. Those were the figures tabled and passed by the House, March 31, 2002.
Now, the Finance minister wandered into the discussion of what was tabled and was actual, and that, well, theyíre two different things. So, letís just talk for a moment about the actuals. During the election campaign, the Auditor Generalís report for 2001-02 became public. The projection that had been tabled in the House was for a surplus of $78,849,000. The Auditor Generalís report became public in October, as was required, and it said, amazingly, that the surplus was exactly as it had been projected to be ó $78 million.
Does the Premier agree that that was the surplus for 2002 as decreed by the Auditor General in October? Does he agree with that statement? Thatís the one the Auditor General made.
Hon. Mr. Fentie: Yes, the Auditor General did the final accounting and came forward with what the surplus was at that time for the fiscal year ending 2001-02. Weíre talking about a different fiscal year now and the Auditor General hasnít done the final accounting.
Ms. Duncan: Iím aware that the Auditor General hasnít done the final accounting, but what we have established so far this afternoon is that the deficit tabled by the Liberal budget was $41,470,000, and that the surplus ó after the revotes and lapses ó was $25,879,000. On March 31, 2002, that was what the projection was.
Weíve established that the surplus, when the Auditor General was done with the books on our first budget, was exactly what we said it would be ó exactly. So letís move forward. There was a sessional paper tabled ó the Finance ministerís former seatmate tabled a sessional paper, and that sessional paper was tabled on June 12, 2000. What he did was table a sessional paper that was a confidential document, which was the Government of Yukon financial position, unconsolidated.
Now up to that time, no one ó except those who had been a Cabinet minister ó had ever seen a document like this, and it became a sessional paper. It is a document that goes to the Cabinet ministers, and it tells exactly what the surplus is that month, at that given point of the Cabinet meeting or Management Board meeting. He tabled this document, and it stated a surplus, and he had handwritten in a number of items on it as to when the government started, so on and so forth.
The practice in this House had been to only table what the amount the surplus was when the budget documents were tabled.
That fact was changed with the tabling of this sessional paper.
So I am going to ask the Finance minister ó he was very close to the member who tabled this paper ówhat is the surplus today? What is the surplus as of the last Management Board meeting?
Hon. Mr. Fentie: Well, until we have the completed period 12 variances, we are probably close to what was projected previous to that.
As far as a sessional paper, I am not sure what the member is talking about. The member should probably table it because itís not something that weíve looked at in the last few months.
What we have really established is that the former Liberal government dramatically increased spending in the Yukon. Regardless of what the surplus was or wasnít, the facts are that they increased spending by some $33 million in 2001-02. In 2002-03, they increased spending by some $40 million. So, in two years, they increased the spending of government by some $73 million. Whatever the surplus or deficit was at any of those times, it is a dramatic increase in spending and that is what we have established.
Ms. Duncan: No, Mr. Chair, we havenít. What we are talking about is that the member has repeatedly stood on his feet and said that the previous government spent all the money. I would encourage the member, without sounding too sharp, to focus.
What we are talking about is the surplus. What we have established is, without a doubt ó the Auditor General confirmed that the surplus was what the Liberals said it was going to be under our first budget. So when we said the surplus was going to be $78 million, it was $78 million. The Auditor General confirmed it. So letís focus on the surplus.
The sessional paper Iím referring to is a document that was tabled by the former Member for Faro, and the document was the Government of Yukon Financial Position Unconsolidated. It is an Executive Council Office document. It shouldnít have been tabled in the House, but it was, and it is now a sessional paper. Itís a sessional paper that was tabled in the House, so it became a public document. The public document is a report that goes to every Management Board. Itís the same format. Itís exactly the same. It just has a different date on it. In it, thereís a line that says, "This is what we published for accumulated surplus. This is what the annual deficit is. This is what the estimated annual deficit is. This is the estimated annual surplus." And thereís an estimated accumulated surplus.
Now, Iím asking the Finance minister ó he says he wonít tell me whatís in the current document because they havenít had all the variances in. The last one of these that I would have seen would have been October, because we didnít call Management Board meetings; we didnít spend any money during an election period. It wasnít our job. A special warrant is a Cabinet document and was dealt with. That was the last item. So upon taking office, the Finance minister would have received one of these. Iím asking him a very straightforward question: what did the document say in the estimated accumulated surplus when he took office? What was the figure?
Now, lest anyone think that Iím breaking or that thereís some kind of Cabinet confidentiality to the estimated accumulated surplus, the Government of Canada does this all the time. The Finance minister stands and says, "The surplus today isÖ. da dut da da." Our Finance minister says thereís no need to access this information, theyíre an open and accountable government, "Come on up for coffee," he says, "just ask me." So Iím just asking.
What was the surplus when he took office?
Hon. Mr. Fentie: First off, Mr. Chair, I would wonder if weíre debating the fiscal yearís budget of 2003-04 or something the member opposite is trying to claim from budgets past. Thatís a question I would have for the member opposite.
Frankly, when we sat down with the opposition parties, we presented to them the fiscal projections, handed them to them in document form. I donít know what the member did with her copy, but I think that reflects the fiscal position the government was in when we, the newly elected government, took office. As far as anything else, the projections are laid out in her budget, the 2002-03 budget, and the projection for our 2003-04 budget is laid out. If she wants to know the exact accumulated surplus ending period 12, we will get the Auditor General to do that, and Iím sure he will, but the projections donít change. They show approximately some $17,631,000 and thatís less the census reserve fund, so thereís not much that has changed.
Ms. Duncan: Good try. The Finance minister knows very well that he received a document that would have given him the estimated accumulated surplus as of March 31, 2002 when he took office ó and not at the swearing-in. He would have received that before then, in the briefing during the transition.
In any event, he received it and it had an estimated accumulated surplus on it. The estimated accumulated surplus tabled by our government was in excess of $25 million. That represents the spending decisions for which our government had responsibility.
That was the surplus that was there when it was tabled in this House. That was the estimated surplus. Now the Premier wonít confirm that that was the estimated surplus when he took office. So weíre going to take it for a fact that that was the minimum in the estimated accumulated surplus. There are also revotes in a few other things.
The fact is that the Finance minister wonít prove his argument. He continually states that that terrible Liberal government spent all the money, but he wonít prove it. He wonít tell the House and he wonít tell the public what the surplus was when he took office. So let me give him another opportunity.
It was not made public in the papers, in the documents the member produced for the opposition, because the members didnít produce this document for the opposition. The members didnít produce this type of a sessional paper. The members produced their own version with changed forecasts and without lapses, and weíll be going to that point in a moment.
Will the Premier fully outline precisely what the figure was in the estimated accumulated surplus when he took office in November? Will he tell the House that figure?
Hon. Mr. Fentie: We made those numbers available, and not only to the opposition. We had a press conference and provided numbers to the news media. The member is going on and on about some sort of sessional paper. Well, thatís fine. Maybe the member should table it because we donít have one here.
Furthermore, the member is stuck on this idea of their fiscal year spending and the fact that the Yukon Party government was sworn in on December 2, and that suddenly a large percentage of that fiscal year spending can be attributed to the Yukon Party decision making.
Thatís not the case, Mr. Chair. We went through this debate at great length in debating the surplus. The issue is that there were a number of expenditures that already had money allocated.
What we did was add $5 million to that for the community development fund and FireSmart. Whether itís a sessional paper or the Auditor Generalís final accounting or if itís the projected figures, the issue with that member is who spent what money in their fiscal year.
We have already stated on the floor of this House that we accept responsibility as the government, when bringing forward this supplementary, that those expenditures are in that supplementary and are brought forward here to be passed. Some of them were the former Liberal governmentís direction in terms of spending; some of them were ours. Ours was, in total, $5 million.
Ms. Duncan: We have spent an inordinate amount of time on the responsibility and the facts are clear, although the member opposite refuses to provide the information as to who approved what spending. The facts would be made abundantly clear.
We have even heard some of his ministers recognize yesterday that the Liberals did have a capital budget prepared and ready to go ó something that he wasnít prepared to admit earlier.
I am going to send over this sessional paper so that the minister knows, and it will become abundantly clear and immediately familiar to him as a document that he receives regularly as the Finance minister.
I would like to ask the page to take this over to the Finance minister and ask him to return it.
Itís not a document ó I am not tabling this document. I recognize it for what it is. I also recognize that it has been previously tabled in this House ó a sample of this ó therefore, the precedent has been set for someone ó the Finance minister ó to stand up and state what the accumulated surplus is as of the date they took office. All I am asking from a Premier and a Finance minister who promised Yukoners openness, accountability, and there are a number of C words ó collaborate, cooperative, consultative ó to be open and frank. Tell Yukoners what the figure was when he took office. Tell Yukoners the figure as of November 4.
Hon. Mr. Fentie: Well, Mr. Chair, we did. Upon taking office, we made those figures very public. But the member opposite, if she wants to continue with a practice that she says happened under a former government, then I would suggest the member opposite table her sessional paper from the period leading up to when we took office on December 2.
Ms. Duncan: Mr. Chair, Iíve said that tabling the document and filing the sessional paper was wrong. The precedent was set for revealing the information. Iím asking about the information. I canít; I didnít take that document. Thatís a confidential Cabinet document. It goes to the archives. I, and all members, became aware of the existence of documents like that because it was tabled in a sessional document. Iím asking for the information.
And the member opposite is wrong. That information was not provided, because the information that was provided to the media was provided without the discussions around net lapses.
Now, Mr. Chair, weíve established that the Premier, although he promised consultation and collaboration and to be forthcoming with information, is not. Weíve established that when the Liberals left office, the deficit was, according to the documents tabled in the House, $41,470,000. The accumulated surplus estimated was in excess of $25 million. Thatís what we were living with. Thatís what the public understood ó that we had a surplus in excess of $25 million. Now the Premier wonít tell us. He says, "Oh, the Liberals spent all the money," but he wonít tell us what the surplus was when he took office. He wonít state it on the floor of this House. It has been done before. Why wonít he tell us?
The precedent has been set. Iím not asking for the document to be tabled, because I know that itís a Cabinet document. Iím asking the member to tell the public, because the public has had the information before; tell the public now. What was the surplus when they took office? And he says he has told the media what that line would be.
Well, say again what it is. He should have no trouble tabling it now, no trouble providing that information now. It should be on the top of his head. If heís going to maintain his argument that all the money was spent, that only $5 million of this $56-million deficit budget is his ó show us. Tell us the number; tell us the surplus number that was on the books when the Finance minister took office.
Hon. Mr. Fentie: Well, the member opposite makes the claim that weíve established a number of things here and, frankly, weíve established a sensitivity in that member opposite to what happened under their short reign in government. As far as the financial position of the government when we took office, we presented that position to the opposition in good faith ó all the documentation ó and we presented that documentation to the media. The numbers were all there and, Mr. Chair, this is a needless debate. The member is just trying to discredit this side of the House for no reason whatsoever. The numbers have all been provided, not only to her and the official opposition, but to the public.
Ms. Duncan: Okay, Mr. Chair, letís keep it really simple and focused. What is the surplus today ó April 8? What is the surplus today?
Hon. Mr. Fentie: We donít do the surplus on a day-to-day basis, Mr. Chair. We do variance reports period by period, but Iíve already stated on the floor of the Legislature that the surplus is some $17,631,000 less the census reserve fund.
Ms. Duncan: Well, Mr. Chair, just so the Premier has it clear and the record is clear, it may not do a surplus day to day but it has been clearly shown in this House that the amount thatís in the surplus is received on a regular basis by Management Board. He wonít give me the surplus as of April 8, and the March 31 figures will be confirmed by the Auditor General, so weíll wait for those March 31 figures. I asked what the surplus was today; he said he doesnít have it and gave me a figure of $17 million less the census reserve. He refuses to provide the figure for what the surplus was when he took office.
I would ask the Premier to perhaps review ó not perhaps. Would the Premier please review the Blues, review the sessional paper and provide the information I have requested, which is: what was the surplus when they took office and what was the surplus today, or at the most recent Management Board meeting? If they meet on Wednesday or Thursday, April 9 or 10, Iíll take either one of those dates. If he would just provide that by legislative return, I would appreciate it. It is not a state secret. The surplus amount can be released. Other governments have done it on specific dates, so Iím asking for the surplus on those specific dates.
Hon. Mr. Fentie: Mr. Chair, I have provided the member opposite with the surplus, the projected number, net the census dollar value that we have in reserve. And the member opposite should well know that, to achieve any constructive form of debate here, the next step now is to have the Auditor General do the final accounting so that we have the exact surplus figure fiscal year ending March 31, 2003.
That would benefit greatly this debate. And then from that point on weíll deal with the situation we are in fiscally. Our projections are very clear in the budget, where the surplus is at, and weíve tabled the third largest budget. So itís not a question of needing to provide any detail. Weíve provided what we have ó the projected figures. When the final accounting comes in, weíll provide that member the exact figures as the Auditor General sees it.
Ms. Duncan: Well, Mr. Chair, the Auditor General reports to the whole House, not just the member. The facts of the matter are that the estimated accumulated surplus, according to us, is in excess of $25 million, and when the Auditor General reports, she will either confirm that figure or the Premierís figure of $17 million less the census reserve. The contingency reserve was taken out of the $25 million, so $25 million after the contingency reserve, so the minister has substantially reduced the surplus.
Now, in the interests of constructive debate ó and I notice that when the differences in the ministerís number are pointed out that the debate tends to be reduced somewhat ó given that weíre not going to get this information from the Minister of Finance, Iíd like to move on to a couple of other specific questions about the financial figures that have been provided by the minister; namely, would he please indicate when the opposition might receive the information with respect to job creation and community distribution? That has not been provided, although it is standard practice to provide it well in advance of the budget.
Hon. Mr. Fentie: Well, again, let me point out that we have provided the projected figures for the member opposite, though she may not like them ó some $17 million, net, the census reserve. I think the member opposite is missing a very important point here. Itís about the trajectory of spending that could not be sustained in this territory. Thatís evident in the way the surplus was dropping. The surplus was at some $78 million one year prior to the last fiscal year.
Today we are looking at a projected figure subsequent to that former Liberal government spending of some $17 million. That tells you something. The trajectory of spending was way out of line with our ability to sustain that spending. As far as the community breakdown and those types of figures, we will provide that information to the member in the immediate future.
I think we have them now developed, and we will provide them to the House.
Ms. Duncan: I look forward to that immediate future. Hopefully that, in this case, means this week and not in this mandate. We have seen the definition of "immediately" be a little fast and loose, so I would hope that that would be this week.
The minister was talking about differences. I would really like the minister to explain why in the previous projections and previous supplementaries delivered in this House and in the budget documents delivered ó there were revotes and there were also lapses. The lapses at year-end in this supplementary tabled by that Finance minister are $11 million. The lapses in the original budget document were $29 million. How did they get reduced by $18 million?
Hon. Mr. Fentie: Again, the member is dealing with estimates and, as the fiscal year evolved, the estimates changed. What was becoming evident was there were fewer lapses available versus what the original estimates were. I point out to the member opposite that this kind of debate is usually dramatically changed when the Auditor General brings in his final accounting. Thatís why the Auditor General does his work, Mr. Chair.
Furthermore, the memberís statement that "this government is fast and loose" is unacceptable. This government commits to providing information, and we do so. The member opposite, though, because she asks at five to 3:00 in the afternoon and expects that same information to be provided at 10 after 3:00 that same afternoon, is going a little beyond a reasonable acceptance of whatís required to put together information and bring it to the member opposite.
Thereís no hesitancy on our part to provide information, Mr. Chair ó none whatsoever ó and weíve done so daily in this House and will continue to do that.
Ms. Duncan: Well, Mr. Chair, I urge the Finance minister to just take a deep breath and calm down. First of all, I asked for the information when I received the budget documents in the budget lock-up, February 27. I think itís reasonable to have expected them by April 8. Thatís reasonable.
So my reference was not to the government playing fast and loose; it was the definition of the word "immediately". The member has varying versions of what "immediately" is. For example, to "immediately" restore the CDF and FireSmart money meant several months into the mandate, and maybe next mandate, in his speech to the Chamber, and "immediately" means that providing information is a month and a bit away.
The facts are what the facts are.
Now, I know the Finance minister finds it uncomfortable as Iím leading him through these figures. However, the Finance minister has also stood on his feet and made several disparaging remarks about the previous governmentís ability to manage the finances. So, in fairness, Iíd like to talk about the facts of the matter. Iíd like to talk about the numbers. Thatís what general debate in the budget is about as well ó to talk about the numbers.
The facts of the matter are that the deficit under our watch was $41 million, and the projected surplus was in excess of $25 million. Now the minister has taken office. Heís saying the projected surplus is $17 million. Thereís a difference there. Thereís also a difference in the lapses. He has given different figures than what I had given as Finance minister. He has to explain them, and he has to be accountable for them.
Now, the facts are that he wonít provide the figure for the surplus when he took office, and he has only provided the surplus as per the budget documents. Well, Iíll live with the second; I wonít live with the first. I would like that figure provided.
Moving on, I asked why there was a difference in lapses. There is $18 million that is not accounted for between March 31 and November 4, 2002 ó $18 million. Changes in estimates at year-end ó well, what changed? The minister really ought to provide a little more detail than "estimates changed". So, $29 million was too high ó how did they arrive at $11 million? Thatís one question: how did the Minister of Finance arrive at $11 million? Thatís an $18-million difference. Thatís a lot of money.
The other point is that the revotes are left off the supplementary information. Why are the revotes not there?
Hon. Mr. Fentie: Mr. Chair, the information as regards the lapsed funds is based on the survey. I donít provide the number. The Department of Finance does a survey, department by department, engaging them to find out what their estimates for lapses will be, and those things change over the course of a year. Considering that the member does not want to deal with the budget tabled before us ó the budget weíre supposed to be debating here in Committee of the Whole ó and wants to debate the surplus now, weíll go dig up the surplus, and I move that we have a short break.
Chair: Do members wish a recess of 15 minutes?
Some Hon. Member: Ten minutes. Agreed.
Chair: A 10-minute recess.
Chair: Committee of the Whole will come to order.
We will continue on with general debate on Bill No. 4, First Appropriation Act, 2003-04.
Hon. Mr. Fentie: Getting back to the issue we were discussing with the member opposite before the break and the difference between the estimated lapses in the 2002-03 budget and the estimated lapses as to the surplus and the revotes. We can probably attribute a great deal of that to the fact that the money was revoted and comes out of the total overall estimated lapse from the original budget and shows up now in the surplus in that amount, which would ó again this is an estimate ó show $11 million in lapses for fiscal year-end.
Ms. Duncan: Iím sorry, Mr. Chair. I thought the minister called for a break so he could go upstairs and get me the two figures for the surplus ó the November 4 figure and the April 8 figure.
Hon. Mr. Fentie: The facts are that weíre dealing with fiscal budget 2003-04. Weíve just spent a great deal of time with the member opposite on previous budgets that have passed this House and been debated. We have provided the member the surplus figure. The member wants exact figures from whatever period they may be in. We consider that irrelevant to the debate. It has no place in this debate on a fiscal budget for the next year, 2003-04, which we are in, by the way. It commenced April 1. The member has all the availability of those numbers when the Auditor General concludes the final accounting and provides the exact numbers for the fiscal year ending March 31, 2003.
Ms. Duncan: No, Mr. Chair, I donít. The member thought it was intensely humorous when his former colleague tabled that information in the House when I was the Finance minister. Iím just asking the Finance minister ó because he promised collaboration and consultation and openness ó for the same information. The Auditor General will not provide a figure of the estimated surplus as of November 4. The Auditor General will confirm the figures at year-end. She will provide that information to the entire House. Turnabout is fair play, I believe is the expression. So all is fair in seeking the same information. I just asked for a figure. It is very relevant to the debate. Will the Premier provide me with the figure for the estimated surplus as of ó call it November 1. Will the Premier provide me with that figure? Itís a yes or no. If he says yes, Iíll take it by legislative return. I just would like the figure, please.
Hon. Mr. Fentie: Mr. Chair, considering the fact that some member in the past in this House provided a document that may or may not have been relevant to the debate is by no means an issue that should dictate the government to follow suit. I canít be responsible for what former members have done in this House. We have provided this member all the information we have in terms of the estimates and the projections, and the final accounting will be done by the Auditor General. If that is not sufficient, there is not much I can do to help the member opposite.
Ms. Duncan: Mr. Chair, thatís really unfortunate. Itís not consultative, itís not collaborative, itís not living up to their word, and itís not living up to practice in other jurisdictions. The Government of Canada provides that surplus figure all the time. Had I been asked, I would have done it.
Iím not going to belabour the point. The minister refuses to provide the surplus figure as of November 4. He refuses to provide it.
The minister has given an explanation for the difference in lapses and has given a statement as to no revotes. Would the minister confirm for the record the precise amount of the transfer for devolution, both O&M? I believe itís $37 million or $36 million. Would he confirm the figure and the amount agreed upon for capital in devolution? What are the two figures that are being transferred?
Hon. Mr. Fentie: We have not, I have not, this government has not refused to provide the information the member seeks. In fact, we did it very openly upon taking office. But if that member is so concerned about those figures, why doesnít the member just go and look at her own figures that are available to her? The member was responsible during the period of time that would dictate what those numbers were. We provided those numbers, not only to the opposition but to the public, upon taking office.
As far as the devolution figures, itís coming to Management Board, and the approximates are somewhere around $38 million and $10 million.
Ms. Duncan: Mr. Chair, Iím not going to argue the point with the member previously. The member has given the figures of $38 million in operation and maintenance and $10 million in capital. Those figures are not reflected in the 2002-03 projections of money from Ottawa ó correct?
Hon. Mr. Fentie: No, they are not reflected because we stated already on the floor of this House that there was a final accounting that needs to be done from the federal government side, which is fiscal year-end March 31, 2003. I have provided the member the approximates and that is what they are ó some $37,129,000 and some $10,023,000.
Ms. Duncan: There was a $4.5-million primary health care fund transfer from Ottawa announced on March 3 ó it was announced by the Health minister on March 3. Is this figure included in the 2002-03 budget?
Hon. Mr. Fentie: Well, as is the $20-million fund that we just negotiated a three-year term on, so too is the $4.5-million primary health fund. Itís new money and itís not reflected in this budget. In fact, it hasnít even arrived yet from Ottawa. Once it is, we will determine when and how to book it.
Ms. Duncan: So the $4.5 million was a subject of a press release and a banner waving, but it wasnít booked in the budget. And the $20 million isnít booked in the budget.
The $12 million, as I understand it, with the health care discussions with Ottawa ó there is a $12-million base amount, for lack of a better word, that all the provinces are getting and then there is the $20 million over and above that that the three territories are getting.
There are great discussions going on between the Finance minister and officials and the Health minister. Would the Finance minister exactly outline the health transfers and reconfirm that, no, they are not booked ó just those specific items? We can move debate along if we answer the question specifically.
Hon. Mr. Fentie: Theyíre not booked in the budget because there were no final numbers provided by the federal government. In fact, when the member talks about the monies that the provinces are getting for the new health accord, so on and so forth, there are all kinds of different numbers being bandied about, and weíre going to wait until we get the exact detail from the federal government. We know monies are coming, but weíre certainly not going to book monies in the budget that may be totally off base from what weíre really going to receive from Ottawa. Weíre going to wait until weíve signed our agreements and know exactly what is coming, and then itíll show up, Iím sure, and be reflected in the supplementary.
Ms. Duncan: Mr. Chair, Iím not asking the member why itís not booked ó I know why itís not booked. Iím asking the member what the amount is. Has it been confirmed? I was just asking for confirmation that it hasnít been booked.
I understand why the devolution money hasnít been booked. I would just ask for confirmation of the numbers. He has provided that. The $4.5 million was announced; there was a press release that included the Minister of Health so, presumably, if thereís a press release and we know that $4.5 million is coming ó thereís $20 million and thereís health accord money. So there are three pots of health money ó is that correct? ó at this point.
Hon. Mr. Fentie: The numbers have not been confirmed. We know there will be a $20-million fund separate from the accord, separate from per capita, which will be spread out over three years. We will be signing an agreement on that. To the best of my knowledge, the $4.5 million that was announced for primary is part of the overall approximate $12-million fund. None of these things have been confirmed in terms of how the money will flow and when from Ottawa. We are simply passing on to the public commitments that Ottawa has made to us.
Thatís why theyíre not booked in the budget, Mr. Chair. We are going to wait until we get confirmation on exactly how the money will flow, over what period of time, and take it from there. But as far as the overall dollars, the other is $12 million, but I think $4.5 million of that was announced as primary health monies. Then we know that the $20 million is there. But we also have a commitment to negotiate a process to address the inadequacies in the per capita funding. So there is much more to this that is ongoing, Mr. Chair.
Ms. Duncan: Thereís a commitment to address the per capita. Thatís over and above, and Iíll get into the question about how weíre doing with the formula negotiations. Letís leave that out of the equation. Thereís health accord money; thereís $20 million. The $4.5 million was the primary health care transfer and was negotiated before the first ministers met. Then thereís the devolution money. So thereís all of that money, but it has not arrived yet so itís not booked yet ó understood.
There are other one-off funds like the strategic highway infrastructure program, the Tough report. There are other pots of money. Some of that, if we have confirmation, is booked. My point is that there is more money coming from Ottawa next year. It hasnít been booked yet because we havenít finalized the amounts. Can the minister confirm that it hasnít been booked yet because we havenít finalized the amounts but there is more money coming? And I just want confirmation ó there is a page in this budget address, in the long-term plans, that says that the transfer from Canada, 2003Ė04 projected actual, is $359,800,000. That doesnít include devolution and doesnít include health care money. It might include something like a one-off, like strategic highway or Tough. Is any of this new money in that projected actual transfer from Canada? Yes or no.
Hon. Mr. Fentie: Well, no. The answer is no, itís not in there, but furthermore the member is asking a question that relates to all this new money coming.
First off, the devolution money is going to be expensed. Itís a transfer of the cost of operating the federal system. Thatís what that money is for. As regards the health care money, what we have managed to accomplish, outside of negotiating a process to address inadequacies in per capita funding, is to address, to some degree, our annual deficit in health care. Then there will be other areas where the federal government may contribute. However, if you take child care, for example, the amount of money in the budget from the federal government for child care is X number of million dollars, but that translates into about $25,000 for Yukon ó sorry, not child care but daycare, Mr. Chair. Whenever we get the firm numbers and the contribution agreements signed with Ottawa, they will be reflected in a supplementary, but theyíre certainly not in this budget. There are no new monies that would be coming to the territory from Ottawa reflected in this budget, but they will be reflected in due course once we know the exact amounts.
Ms. Duncan: The new monies being transferred are not reflected in the long-term plans. That being said, the long-term plans show the transfer from Canada going from $347 million to $359,800,000 to $366,600,000 to $377,600,000 to $391,500,000. This is the transfer from Canada going up. The ministerís press release, when he announced the budget, said it was going down.
The facts in the press release were wrong. The budget ó the long-term plans ó are right, and the money is going up. And that doesnít include the new money. Thatís the point I was making. The minister has said that the transfer from Canada is going down. Clearly, itís not. Itís going up. Will the minister now agree that the transfer from Canada is, in fact, going up? Thatís what the long-term plans show. Yes or no ó is the transfer going up?
Hon. Mr. Fentie: We just went over this with the leader of the official opposition. The best available numbers show that whatís happening in provinces and other jurisdictions will reflect an upward pressure on our transfer, but very limited. Second, the loss of population has seen us decrease what would be a transfer from Ottawa by some $30 million to $40 million. Third, the census will be concluded here shortly and will reflect that loss in population, and we will be experiencing a decrease on what would normally be transferred because of that loss in population.
So we are using the best available figures, conservatively projecting where weíll be at, considering all those factors. At the end of the day, government was far exceeding its ability in spending, given the fact that the spending was increasing at a much more dramatic rate than any revenues. We are in a situation where we had to address that issue.
I know where the member is going with this. At the end of the day, we are not receiving enough money to sustain the spending, and we have lost population, which will be reflected here shortly, when the conclusion is brought forward on the census.
Ms. Duncan: Mr. Chair, the $15 million is set aside for census adjustment. When is the minister expecting the figures?
Hon. Mr. Fentie: The member knows that those figures come in the fall, so we will expect those figures sometime around September, October. We are working now on the undercount on the preliminary figures just to make sure we do everything we can to diminish the impact of this loss in population, which is quite significant.
Ms. Duncan: Has he raised the issue with the Minister of Finance?
Hon. Mr. Fentie: Mr. Chair, we began raising this issue with the Prime Minister and began with the first ministers meeting. The Minister of Finance wants to talk to us, Iím sure, but at this stage of the game, weíre working on our issues with financial officials in Ottawa to deal with this situation and, hopefully, we will diminish the impact, but we shall see and we wonít know that until the fall.
Ms. Duncan: About 18 months ago, there was a situation where Canada Customs and Revenue Agency had made a mistake with the provinces, and provinces owed the Government of Canada millions ó billions in some cases, I believe. The $15-million census adjustment was set aside because, if the census turned out ó with the undercounts and everything else ó as badly as we feared it might, we knew weíd have to pay some money back. Has the Minister of Finance made any representations to the federal Minister of Finance ó because thatís where the issue belongs ó that we donít want to pay back this $15 million, that we could perhaps, with some help, live with an undercount downward? And Finance has conservatively projected, with the population loss ó itís the $15 million back payment Iím worried about. Has he made any representations on it?
Hon. Mr. Fentie: This is part of the formula agreement. There is not a lot here that we are going to do other than lessen the impact by ensuring that the numbers are close to the realities that are reflected here in the Yukon today. Thatís why we are working with officials on the undercount, and so on. But it is important that we all understand that this was recognized at the Prime Ministerís level ó a clear commitment to work on a process to address the inadequacies in the formula. Those negotiations are important to us.
But as far as the formula and the agreement as it exists, we will receive an impact here that will be negative. We are doing everything we can to lessen that impact.
Ms. Duncan: Every Finance minister, whatever their political stripe, makes conservative estimates, lives with conservative estimates on the formula amount. Every Finance minister deals with the fact that there has been, for some years, a conservative projection in light of our population decrease. $15 million was set aside as a back payment. This is outside of the formula. This particular issue would be to pay off a bill. It is outside the formula in the sense that the formula deals with the current population, but the precedent was set in other provinces where other provinces didnít end up paying it back.
He missed the Finance ministers meeting in December when he could have raised this with his colleagues and asked for their support. Has he written to John Manley, the Minister of Finance, and said, "Look, we might be taking a hit in the future on our formula." We had started formula negotiations before the minister had his discussion with the Prime Minister. I am just asking him if he has done his job and written to Minister Manley on this particular issue and said, "Look, we donít want to pay back the $15 million." Has he done that?
Hon. Mr. Fentie: Mr. Chair, first off, the member is incorrect. This $15 million set aside for a census adjustment is all about what will happen under the formula. Thereís no question about that. Second, weíve dealt with the Prime Minister. Third, our officials are working on this issue, and at the appropriate time I will be dealing with the Minister of Finance when I can provide him the detail to make a case. At this stage of the game, weíve progressed nicely between the Finance officials in Ottawa, the federal government, and our own officials, and weíre going to continue to work on this issue. As I said, at the appropriate time, I, as Minister of Finance for Yukon, and Minister Manley will be having an in-depth discussion about our situation here in the territory. But we began that discussion for a purpose with the Prime Minister, and we achieved results with the Prime Minister. Itís the Prime Minister who stood on the floor of the House of Commons and said this situation, as far as per capita funding, does not work for the territories. It is the Prime Minister who has taken the lead, and we will continue to work on those fronts to address this situation, which is critical to the Yukon due to our loss in population.
Ms. Duncan: Mr. Chair, letís move on. The minister doesnít want to answer that question, so letís get into the specifics of the budgets he has tabled ó not the lines. Generally speaking, the capital creation of the previous governmentís budget included the gross capital of $118 million, and the estimated job creation was 700 jobs. The member has tabled a budget with a projected capital budget of $70,800,000 in capital spending, but he wonít tell us how many jobs. So if we can assume that there are 700 jobs for $118 million in capital, does he have any idea how many jobs are created with $70 million in capital, and how does he propose to increase the unemployment when he only proposes to spend $56 million in capital in 2003Ė04?
Hon. Mr. Fentie: Itís going to be pretty hard to determine jobs for the member opposite when weíre not even dealing with apples to apples and oranges to oranges. The actual capital for 2003-04 is $98,693,000, and weíre going to try to create every possible job we can with that in this territory, considering the situation we are in fiscally.
Mr. Chair, again, the government cannot spend its way out of this economic problem, this economic devastation that we are facing. It has to be in partnership with the private sector and thatís what weíre embarking on with this budget.
The values the member is talking about are completely different from what Iím looking at. The total, in terms of what would create jobs, is not ó I think she said $50 million or something. Itís actually $98 million, almost $99 million.
Ms. Duncan: Letís take the member back. The net capital expenditures for 2002-03, tabled by the Liberal government, were $71 million and the figure stated was 700 jobs. The Yukon Party has net capital expenditures of ó although we had projected $71 million, theyíre down to $70,800,000. Theyíre now projecting for 2003-04 a net of just under $56 million. Thatís what the net capital says in the budget address ó long-term plans, net capital $55,700,000, projected actual for 2003-04.
The minister is shaking his head as to where I get that figure. Itís in his budget document. All Iím asking is: whatís the projection of jobs for that money? If we projected 700 jobs for $70 million in net capital spending, how many jobs is the minister projecting for net capital spending of $56 million? Itís a question any voter would ask. How many jobs are going to be created out of that capital spending?
Now, the minister says ó Iíll let him answer that question.
Hon. Mr. Fentie: Well, I donít see the relevance here. Why would we be talking about how many jobs are created by net capital spending? Is the member inferring that the capital spending that is a recovery isnít going to create any jobs? The number here is $98 million ó almost $99 million of capital spending in this territory in this fiscal year. Weíre going to try to create every possible job we can with that spending.
I donít know how the member projected 700 jobs from their capital expenditure. It certainly didnít do them much good in the election.
Ms. Duncan: If all else fails, throw in the cheap political shot.
Well, the minister opposite said, "Compare apples with apples." So, thatís what I was doing. I asked for a projection of jobs. He canít give me one. The minister says, on his feet, "Well, the government doesnít create jobs; itís the private sector." So, if he believes that ó if the minister says, and he has said ó thereís no "if" ó "Government doesnít create jobs; the private sector is going to create jobs."
Well, what goal did he set? The minister has stood on his feet before and said, "Well, it was this percentage of the economy under previous governments. The private sector has gone from a low percentage of the economy to sinking even lower." He says the private sector has to drive the economy. He must have set a goal for himself. What is that percentage goal he has set?
Hon. Mr. Fentie: In what area? Weíre talking about a number of things. The important factor here is that, in any economy, itís the fuel that drives the economic engine, and that happens to be cash flow, economic generator dollars.
As far as how the member gets 700 jobs out of their capital budget is beyond me. Thatís certainly not reflected in any documentation I have ever seen. At the end of the day, thereís a standard practice that is used by departments to provide the best possible information on how many jobs the capital expenditures would create. In terms of the memberís last budget, which was a total of $118 million, it created somewhere around 563.9 jobs. Our $98 million is projected to create 532.2 jobs.
So itís all relative, but I have no idea where the member gets 700 from, Mr. Chair.
Ms. Duncan: From figures provided by the department and tabled in this House and provided to members of the opposition ó thatís where we got the figures. The member is doubting the impact of the capital spending? Ask any contractor in the Yukon right now, and they will say that tabling the capital budget in the fall made a huge difference and getting those contracts out early made a difference.
Capital spending by the Government of Yukon does make a difference. Thatís an old Yukon Party belief, long held and argued endlessly by Mr. McDonald and Mr. Ostashek ó about the value of capital spending. It was driven home when there was an additional capital budget brought in by the former NDP government because of the poor state of the economy, and capital spending made a big difference ó capital spending by our government made a huge difference. Ask anybody who was employed all last summer on the north highway, from one end to the other.
Capital spending makes a difference, and the government is proposing to only spend a net capital of $56 million. That is not a lot of jobs for Yukoners to look forward to and it is not a lot of capital projects. That is the point I am making. That is the difference of opinion.
Now, the minister has made much about the evils of the trajectory and government spending. Under the previous governmentís watch, there was a reduction of a number of deputy minister positions and assistant deputy minister positions. For example, there was no longer a deputy minister in the Womenís Directorate, there was no longer a deputy minister in Economic Development, there was no longer a deputy minister in the Yukon Housing Corporation or the Liquor Corporation. Those positions were gone. There was substantial work also done in renewal.
In his battle against the big, bad trajectory, the minister has spent an inordinate amount of money renaming departments without shuffling a single desk, without rewriting a single job description in those departments. He is also reinstating several new deputy ministers. Iím glad the member finds it humorous; Yukon taxpayers donít.
In the battle against the trajectory, as the member puts it, he has in fact spent more money. Does he have an estimate of how much re-creating the Department of Economic Development is going to cost, and will he table the amount of money it cost to rename ó redo all the letterhead, all the business cards ó without rewriting one job description? And they are losing the IT sector in the process. They donít belong in Highways and Public Works; the information highway is part of the essential infrastructure of the territory. Now where do they find themselves?
Does the minister have an estimate of how much his control of the trajectory, in renaming the department and in re-adding the Department of Economic Development, cost?
Hon. Mr. Fentie: Well, Mr. Chair, that was a humbling experience ó that lecture, but letís get back to some realities.
Jobs are created in capital spending by the total amount. That means the net capital plus the revote equals a total. Thatís the amount of jobs. The member says 700 jobs with their capital spending. Our figures show ó and these figures are produced by the departments ó 563. Our capital spending is going to create 532 jobs. It depends on where youíre spending the money. For example, we increased community development fund and FireSmart. Why? Because it creates more jobs. Dollar for dollar, itís labour intensive, so it creates jobs for Yukoners. As far as this increased cost, I would urge the member to look at the budget. Weíve decreased the budget by some $40 million. Weíve decreased the annual deficit from $56 million to $13 million. Thereís no question that weíve decreased the budget.
As far as the Department of Economic Development, the member knows that we are recruiting a deputy minister. Yes, that deputy minister will be put in place. As far as the costs, all things are being dealt with in-house at this time. The member knows that a great deal of the resources that will be reflected in Economic Development will come out of other departments and be put into economic development. As far as things like Highways and Public Works, to the best of my knowledge, the minister is using the existing letterhead, so costs are minimal in these areas, Mr. Chair. The member should try to deal with the facts and forget all this other nonsense because it simply doesnít add to the debate. Iíd like to debate with the member opposite economies and capital expenditures and what that means to the Yukon and what the loss of the private sectorís injection of cash flow in this territory means to the Yukon and where we can increase the private sector contribution to the economy of this territory.
Those are the kinds of debates we should have. The member opposite could present her ideas on what to do. Instead, weíre debating all this stuff from last year and the year before and frankly, Mr. Chair, itís counterproductive. If the member has some good suggestions on how to deal with the situation the territory finds itself in fiscally, put them on the floor of the Legislature. If the member has some good suggestions in dealing with the economy, letís debate them. But weíre debating stuff from years gone by and, frankly, with regard to this budget ó other than the fact that the expenditures by the previous governments put us in this fiscal position ó we didnít create it; weíre dealing with the residual of that spending. Other than that, the money has been spent and the facts are before us. More people have left, the economy continues to go down, dependence on government continues to increase ó this budget is the first step to change that.
Ms. Duncan: If the member could answer the question, why were there no long-term plans tabled with this budget? The Government of Yukon projections normally include a long-term capital plan. They have in the past. They are pages 2 and 3 attached to the long-term capital plan. Thereís no long-term capital plan in this budget. Why not?
Hon. Mr. Fentie: Mr. Chair, we have provided long-term projections on the best available information. When it comes to the long-term capital plan, weíre going to develop that with Yukoners.
Ms. Duncan: Mr. Chair, the member, in his previous preamble, said, "Challenge me to engage in constructive debate." Whenever heís proven wrong by the point and the numbers, this side isnít engaging in constructive debate. And whenever the Finance minister is challenged ó in fact those good ideas were before him. I was asked for ideas on the forthcoming capital budget. I provided him with those ideas in a post-election meeting, in a transition meeting. As well, his Health minister has now admitted that the capital budget, after we listened to Yukoners all summer, was done. He made a choice not to come forward with it.
And he has made a choice not to include the long-term plan information for Yukoners in his capital budget.
Iíd like to try to get some answers on a couple of other points.
During the debate last week, the minister indicated that a number of items were up for discussion with respect to the mandate for the sole-source contract negotiations on the abeyance agreement. Whatís on the table? There has been mention of land, there has been mention of resources, and there was mention of tax room last week. Whatís on the table?
Hon. Mr. Fentie: Mr. Chair, I must dispute the memberís comments. This is not a situation of a member in this House proving another member wrong. Thatís not the way this Assembly operates. Frankly, the member opposite has provided information that does not reflect the whole equation, and thatís all we keep pointing out.
The member opposite is cherry-picking certain numbers and certain areas to try and put her own spin on things. We merely stand up to point that out. As far as what is on the table for abeyance, well, thatís pretty obvious. Itís a negotiation with a First Nation, which will be commencing with litigation. We committed to avert litigation, if possible.
When the member mentions tax room and all the rest of it, that has nothing to do with that particular initiative. The member, being the former Premier, should know that those discussions are with self-governing First Nations at the tax table. This is not a land claim negotiation. Weíre trying to avert litigation.
Ms. Duncan: Okay, letís focus on that. The Premier and the Finance minister is paying an individual on a sole-source contract $200,000 plus expenses to avert litigation. The litigation is not against the Yukon, but the Yukon is paying this bill.
Does the member agree with that statement of fact?
Hon. Mr. Fentie: Mr. Chair, this member knows full well what the negotiatorís contract stipulates, and itís far in excess of negotiating an abeyance agreement. Itís to take on the duties that are the highest priority of this government in formalizing our relationship with First Nations and developing a full economic partnership. Thatís what itís about.
We have no problem applying resources in this high priority area, and we also committed to bring First Nations into government in a meaningful way to play a meaningful role, and I canít think of another role that is more meaningful than formalizing our relationship with First Nations.
Then I point out to the member opposite what her government did in terms of contracts ó some $377,000 for political advice, some $330,000 for Liberal candidates, even going the step to extend those contracts shortly before the election. This member is in no position to chastise this government on a contract, on one single contract. This member has a lot to answer for, and that happened in the election. The Yukon public spoke very clearly on what they thought of this government of the past two years.
As far as the firm in question, that firm will continue to work on those high priority areas. For the member oppositeís information, Obsidian Consulting is the name of the firm. If the member has an objection to that, maybe it is reflected by the memberís attitude in dealing with First Nations. I donít know, Mr. Chair, but frankly ó
The Chair finds that last statement is casting aspersions on a member, which is an infraction of Standing Order 19(i).
Please withdraw the remark.
Withdrawal of remark
Hon. Mr. Fentie:Thank you, Mr. Chair. I will withdraw that remark and replace it with the fact that, to be able to deal with First Nation people, we must recognize the issues and I canít think of a better way to do that than have a First Nation individual take on the duties that are the highest priority of this government. Thatís what this contract reflects. It is certainly a lot more than the abeyance agreement itself, which we committed to do, to avert litigation ó litigation against the federal government that could have huge ramifications on the Yukon. The member knows that but ignored it, of course, conveniently.
So I think the member should address this issue in context of the total duties that are being taken on by this gentleman in question and his consulting firm.
Ms. Duncan: Mr. Chair, I asked a very specific question. The very specific question related to ó one of the terms of the contract was the abeyance agreement. I thank the member opposite for his lecture. I only wish he had had the grace to apologize.
Would the Premier please advise ó this individual is negotiating an abeyance agreement. I understand that to be correct. That is part of the discussion. I would ask that he reconfirm that, and I ask that he reconfirm that indeed Yukon is not named in the litigation, that the litigation is against Canada. Now, he has said these remarks previously in the House. Iím asking that he confirm them, please and thank you.
Hon. Mr. Fentie: The challenge is against Canada in terms of devolution. We committed to try to avert litigation for a number of reasons. One of them is that we want to conclude unfinished business with all First Nations, including the Kaska, and thatís impossible to do without the federal government at the table, and with litigation in effect, the federal government will not negotiate.
Secondly, Mr. Chair, itís very important to us that we restore investor confidence in the Yukon. Regardless of who is being litigated against in court, we will have a very difficult time in trying to convince the investment community that their investment would be secure if there is court action ongoing. Iím sure the member could understand that. The investment community does not like to get involved in litigation or court action when it comes to putting their millions of dollars into something. Theyíre more interested in profit and loss, as it should be. Thatís really what generates economic growth.
Mr. Chair, Iíll confirm that the member opposite is correct. The Yukon government is not named in the litigation, at least not at this point. There was some question of that some months ago when devolution was happening, and weíre very pleased that the Yukon is not named in the litigation. Itís only the federal government. But that does not preclude the fact that we shouldnít use our good offices to avert litigation so we can conclude unfinished business with First Nations and get on with restoring investor confidence in the territory and begin the hard work of turning our economy around.
Ms. Duncan: Mr. Chair, weíre dealing with a court challenge and a lawsuit naming Canada. Has the Premier asked for legal advice on this issue?
Hon. Mr. Fentie: Mr. Chair, what legal advice would be required to deal with the issue that Canada will not negotiate when there is litigation? We want to conclude unfinished business. We donít need legal advice for that. The federal government will not come back to the table as long as there is litigation in effect, so weíre using our good offices to try to avert litigation, as we committed to do.
Second, we donít need a legal opinion to know and understand that if the Yukon is in court ó albeit the federal government, in regard to devolution ó it affects our ability to allocate third party interests. That negatively affects our ability to restore investor confidence.
So, Mr. Chair, there wasnít a legal opinion required for us to set out on the course we have. We want to avert litigation. We want to conclude unfinished business. We want to develop our economy. We need to do that with the private sector in the investment community by restoring investor confidence, and we have charged these very important duties, which are of the highest priority for this government, to a First Nation negotiator.
I think, all in all, thatís a pretty bold step for a government even though they are not being challenged in court, but we do it in the best interests of the Yukon, and that is the bottom line, Mr. Chair.
Ms. Duncan: Mr. Chair, as I understand what the minister said, he has said there is a legal case against Canada, and that itís in Yukonís interest that the legal case not proceed. So the Yukon is paying an individual, as part of a larger contract, to ensure a legal case does not proceed, although a legal opinion was not required.
The Premier has just said that a legal opinion to ensure a legal case did not proceed was not required by the government, and therefore was not sought by the government. In the Premierís opinion, a legal opinion was not required, so he did not seek legal advice.
Hon. Mr. Fentie: Mr. Chair, we can get all kinds of legal advice. All you have to do is have the money to pay for it, and you can get any amount of legal advice you want. Of course, the government has a legal opinion on what this court challenge may or may not mean, but thatís not at issue here. Whatís at issue is that we cannot conclude unfinished business. Thatís number one.
Number two, it will have a negative impact on restoring investor confidence.
Number three, these types of court challenges can take quite some time to resolve in the courts. We committed to trying to avert litigation, and thatís what we intend to do. We will pursue that end until we know what the final outcome is going to be.
Mr. Chair, I donít know where the member is going with this, but sheís obviously going in a direction that does not reflect the best interests of Yukoners. I canít imagine going to court ó
Some Hon. Member: Point of order.
Point of order
Chair:Ms. Duncan, on the point of order.
Ms. Duncan: Mr. Chair, to suggest that someone is not working in the best interests of Yukoners would seem to me to be casting aspersions and ascribing motives to members.
Chair:Order please. In this House we must operate under the belief that all Members of this Legislative Assembly are working in the interest of all Yukoners, and to state otherwise is casting aspersions upon their character.
I would ask the member to withdraw that remark.
Withdrawal of remark
Hon. Mr. Fentie:I will withdraw that remark and follow up by saying: does the member say that going to court would be in the best interests of Yukoners?
Ms. Duncan: I asked the Premier if he had asked for legal advice or sought legal advice. The answer at the beginning was that anybody can ask for a legal opinion and he said that yes, there is legal advice with respect to this abeyance agreement. Will he provide it?
Hon. Mr. Fentie: Itís not legal opinion or advice on the abeyance agreement whatsoever. Itís an overview of a court challenge that is against the federal government. Our issue here ó and I want to impress upon the member opposite ó is a conscious decision. We want to conclude unfinished business. We canít do that with litigation because the federal government will not negotiate. Therefore, there is no way to conclude unfinished business. Second, any court challenge in this area will have a negative impact on our ability to restore investor confidence. It doesnít take a lot to figure that out. If you cannot allocate third party interests because of court action, then you will have a very difficult time in attracting investment. That is what drives investment in the territory ó the ability to allocate third party interests.
So we want to avert litigation for those reasons. We donít want to spend years in court, should it turn out that way, with the federal government being challenged by a First Nation when we could have done something to avert that and get on with developing this territory and concluding unfinished business with First Nations.
If the member doesnít agree with that, then I would suggest the member should get a legal opinion.
Ms. Duncan: Mr. Chair, I asked the Premier if he had received legal advice on this issue. He said anybody can get legal advice. He said that thereís an overview of the court challenge. I would ask if he will provide that to members of the opposition. Will he provide us that legal overview of the court challenge? He says it exists; will he provide it?
Hon. Mr. Fentie: Mr. Chair, itís not a standard practice to provide legal advice or opinions in this House. It never has been. Mr. Chair, the member opposite can debate this all day long. This is not a question of a decision based on legal advice. This is a decision based on two things, and Iíve relayed these two things to the member opposite over and over and over again. Thereís nothing to do with legal advice here. This has to do with the inability to conclude unfinished business, because there are no negotiations when there is litigation on the federal part. We cannot conclude that unfinished business without the federal government at the table. It will have a negative impact on restoring investor confidence, because now thereís a court challenge that is at play in regard to devolution. Only then ó once the courts have taken control of this issue and have concluded their ruling ó will we understand what the real legal opinion is. That may take a lot of time, so we are taking steps to try to avert that. Thatís being prudent and acting in the best interests of Yukoners.
Ms. Duncan: Mr. Chair, the member has said that weíre paying for an abeyance agreement; itís part of an overall contract to seek an end to a court action, and weíre doing so without legal advice because legal advice wasnít required for an end to a court action. He has also said that thereís an overview of a court challenge ó a legal opinion ó but he says itís not past practice to provide it in this House. In fact, there is at least one instance, if not two, where a legal opinion has been provided to members of the opposition. Such legal opinions have been provided in the past.
With that "itís not past practice" argument being put by the wayside because it has happened in the past, will the member provide that overview?
Itís my understanding he has made a statement about half-a-dozen times that legal advice isnít required for an end to a court action, but nevertheless heís also said he has an overview of a legal opinion. Will he provide that? It has happened in the past.
Hon. Mr. Fentie: Iím not aware if it has happened in the past. The member opposite obviously thinks it has happened in the past. I canít recall that member in government providing legal opinions on the floor of this Legislature. Furthermore, itís not a challenge against the Yukon government. Itís a challenge against Ottawa, and the member is obviously not receptive to the fact that there are other vital issues at play here, regardless of the fact that thereís a challenge against Ottawa in regard to devolution.
Thereís not much point repeating this to the member opposite. Our decision is based on some very important issues ó concluding unfinished business, restoring investor confidence. We committed to avert litigation and thatís exactly what weíre working on.
Ms. Duncan: I have focused my questions very directly: did the Premier ask for legal advice on this particular issue? No, but the legal opinion exists.
What the Premier repeats over and over again is that Yukon is paying for a contract that includes negotiating an end to a court action, that legal advice on this is not required, and that an overview opinion exists. But despite the fact that it has happened in the past ó Mr. Harding provided a detailed legal opinion to Mr. Cable ó despite it having been provided to members opposite in the past, although there is an overview of the court challenge ó a legal opinion exists ó the member will not provide it.
I have focused my questions, and those are the answers I have received. I would like to ask the member if he could answer the direct question: where is this contract within the budget?
Hon. Mr. Fentie: Weíre in general debate, so that question is better served in department line-by-line. I have to go back to what the member just said.
The member says that she has focused her questions and that I have provided answers as she has relayed to the House. How convenient that she does not include for the record that the answer is related to two very important issues to the Yukon, even though the court challenge is against Ottawa and that the member or the person, the contractor, or negotiator that sheís talking about is doing a number of things of the highest priority for the government.
Mr. Chair, thereís absolutely no reason or rationale that this side of the House can think of that would not dictate we try to do something here to avert litigation, regardless of legal opinion. It was the prudent course to follow. There are no winners in court, no matter what, and anybody who has experienced or been on the sidelines of these types of issues will concur with that.
So, you know, the big issue here is not so much that we donít follow legal opinions, which the member is trying to imply. The big issue here is that thereís an attempt to focus in on a decision by government to put a First Nation citizen of this territory ó with impeccable credentials to negotiate, considering his history in the federal government negotiating land claims, considering his history with First Nation negotiating corporate partnerships, considering his intimate knowledge of the issues, and considering that we put a First Nation citizen in a position where they are playing a meaningful role in what is the highest priority for this government in formalizing our relationship with Yukon First Nations. One part of that contract issued to this First Nation Yukon citizen ó Obsidian Consulting is the firm ó is to see if we can avert litigation through negotiating an abeyance agreement. Thatís the answer, Mr. Chair, and any other attempt to make something else out of this is nothing more than an opinion. It certainly is not the fact of the matter.
Ms. Duncan: Well, Mr. Chair, weíre arguing the facts. Iím not going to belabour this point with the minister. I asked a very direct question so that I could focus my debate when we get to that department, and the minister has once again failed to answer. Would the minister please tell the Legislature where the Obsidian Consulting contract is located in the 2003-04 mains? What department? Iíll be happy to discuss it in detail. I would just like confirmation on the floor of the House where itís located.
Hon. Mr. Fentie: Well, Mr. Chair, again, I dispute what the memberís saying and putting on the record. I did answer that. I said this is general debate, and when we get into department-by-department and line-by-line debate, the member can ask that question. Surely the member must understand the difference between a line-by-line question and general debate.
Ms. Duncan: Mr. Chair, I would hate for the details around this particular subject to be missed. Iíd like to discuss it at length in the general debate on the department. All Iím asking, since this is general debate in the budget, is which department, generally, should one be looking in to discuss this contract at length? The minister has not answered that question, so Iím going to take it that itís Executive Council Office, given that itís his signature.
I know thereís additional money, as confirmed by the Minister of Energy, Mines and Resources, for Kaska round-table negotiations. What Iím trying to confirm is: where is this contract? Is it in Executive Council Office, or is it in the Kaska round-table negotiations, which are in the pipeline analysis unit in Energy, Mines and Resources? Which department? Would he please direct that and answer the question? Which department is the Obsidian Consulting contract located in?
Hon. Mr. Fentie: It is a well-known fact that the economic table was established some years ago under the previous NDP government. We only resurrected it. It has proven to be a successful mechanism in the past and I am sure it will again today.
As far as land claims and First Nation issues in this area, for the most part they fall under the Executive Council Office. The member knows that and just stated it on the floor. So why the needless question?
This issue is obviously one that the member opposite is very hung up on and is probably having a difficult time addressing the fact that we are taking steps with First Nations in this territory that differ from what her government attempted to do.
At the end of the day, we are working on it. We have just commenced those areas of work. All of this will be measured by product ó certainly not by the questions coming from the members opposite. It is related to what delivery we can achieve.
I guess I can ask the member opposite what we got out of all these expenditures from 2000 to 2002. They are all in question but the money has been spent.
At the end of the day, the member has lots of opportunity in line-by-line, department-by-department debate to ask these questions.
Ms. Duncan: I will be more than happy to do that.
I thank the minister for finally answering a question. I appreciate that.
Mr. Chair, I just have a couple of other questions. Perhaps the minister would like to prepare his answers for the line-by-line debate. The election platform ó the Premier went to the chamber of commerce in November and said that the election platform is now the platform of the government and waved it around. Where is it costed?
Whatís the total cost of the platform? Iím sure he can answer that when he gets to Finance, given how much he appreciates answering questions.
The minister could also perhaps indicate on the floor of the House, before we move on, what his intentions are with the Taxpayer Protection Act. Will the minister commit that the Taxpayer Protection Act will not be amended, or will he commit to discussion of the bill I brought forward that the Taxpayer Protection Act shouldnít be amended without unanimous consent of the House? Does he intend to use his majority to amend the Taxpayer Protection Act, or will he accept that constructive suggestion put forward?
Hon. Mr. Fentie: As to election platform, that is what we committed to Yukoners to do, and we will continue to work on the commitments within that platform. Of course, itís not going to be all done at once. Anybody of rational thinking would understand that, for example, reconstructing the Robert Campbell Highway is not going to happen in one year or two years. Itís going to take time. Thatís part of the business. There has been a decade of reconstruction under the Shakwak funding on the north highway. So there are a number of areas there that are ongoing works in progress, and costing it out is also an ongoing work in progress. Thereís no way to provide the member those costs on the floor of this Legislature here today. For example, we would have to do a lot of work in obtaining cross-sections, culverts that need be done, borrow pits that have to be developed, clearing that must be done, back-slopes ó all these things must be compiled in terms of information to develop a cost, just on one project, the Robert Campbell Highway.
In moving on, Mr. Chair, I think the member opposite would be well served to fully understand that we canít contravene the Taxpayer Protection Act, and thatís exactly why we had to take the steps we did in this budget, because it was evident that the election call by the member opposite was one that could have been driven by the fact that the member and her government had absolutely no idea what to do about the situation the Yukon found itself in fiscally and was heading toward a contravention of the Taxpayer Protection Act, and to get out of that situation, they simply called an election.
I should ask the member opposite: what are the memberís intentions with the Taxpayer Protection Act?
Ms. Duncan: Well, itís our turn to ask the questions and, unfortunately, weíre not getting any answers. To suggest that the reason for an election call was because of a contravention of the Taxpayer Protection Act is casting aspersions on previous members and is not, in fact, accurate because, if thatís the case, why was the capital budget prepared and ready to go and showed the fact that we werenít in violation of the Taxpayer Protection Act? Why was a budget tabled with long-term capital plans that showed that we werenít in violation of the Taxpayer Protection Act? They were long-term plans that the member didnít have the courage to put on the floor of the House. Theyíre missing from his budget document.
All I asked the member opposite was what his intentions were with the Taxpayer Protection Act. I put forward an amendment to make sure that the Taxpayer Protection Act couldnít be amended without unanimous consent of the House. Thatís the only amendment, so that nobody, no party with a majority, could amend it.
The other point that has to be made and asked ó and which the minister wonít state on the record ó is what his intentions are with respect to the Taxpayer Protection Act. Will he amend it or not? Will he accept the amendment Iíve put forward or not? Those are straightforward yes-or-no questions.
The third supplementary, I would like the minister to state for the record that if they intend to pursue public/private partnerships, to a tremendous degree, would he outline for the House how he intends to account for those and still remain within the Taxpayer Protection Act?
Letís start with the first two questions: is it the ministerís intention to amend the act ó yes or no? If itís yes, will he examine the amendment I brought forward?
Hon. Mr. Fentie: Well, Mr. Chair, this is really rich. Why would we have gone through this exercise of lowering the spending in government if we were going to amend the Taxpayer Protection Act? We would have just amended it and started spending. Itís the Yukon Party government that brought in the Taxpayer Protection Act because of run-away spending by governments.
The member said that their projections and capital budget show that they wouldnít have been in an accumulated deficit position. I beg to differ. It clearly showed that if we would have followed the trajectory of spending by the former Liberal government, we would have been in a deficit position.
Second, the member said that ó
Some Hon. Member: (Inaudible)
Hon. Mr. Fentie: I just heard the Member for Kluane say, "Table it." Well, the Member for Kluane received a good deal of information when we took office that showed where this was going, and they canít dispute that fact. In fact, we invited him in to jointly develop budgets. They refused. One can only wonder why.
As far as long-term plans, theyíre here ó clearly laid out before this House. The capital and O&M expenditures are here. What weíre showing, with our method of budgeting, is that weíre going to a balanced budget.
The member can dispute all of those things all she wants; the numbers are before the House in the pages of the budget.
As far as this so-called capital plan, if you started adding up all the things that this member and her government were going to spend on, we would have been in an accumulated deficit position. Add in the $3.5 million for Grey Mountain School. Add in the money for a jail. Add in the recreation centre in Mayo. Add them all in and see where we would have been at.
Ms. Duncan: We did have them all in. We tabled a long-term plan that showed the jail being built, showed Grey Mountain being built, and, whatís more, it showed the public/private partnership with a balloon payment that is required for the Connect Yukon project. It showed how we dealt with P3s. It showed living within the Taxpayer Protection Act ó and the member opposite knows it.
The proof is in the documents that were publicly tabled in the House. To suggest otherwise, I challenge the member to table the document, prove it. The Liberal government was not taking this territory in violation of the Taxpayer Protection Act because of the documents that were tabled in this House, and they included all of those things. If the member doesnít believe it and tries to suggest otherwise, table the capital budget. His colleagues admitted that it was prepared.
Let me ask one final question of the minister. Letís see if we can get one answer out of the member opposite. The member opposite has said that he is going to bring a balanced budget to the territory; tell us the year. Stand on his feet and answer that one question: in which year will the territoryís budget be balanced?
Hon. Mr. Fentie: Well, Mr. Chair, maybe I could table this document for the member opposite, one that she has probably gone through at great length. It provides the year. In this document, the budget address, operation and maintenance and capital, itís very clear that, based on all the available information, projected estimates, that we could reach a balanced budget by 2005-06. Thatís maintaining capital expenditures of $55 million this year ó thatís with the recoveries out, this is net ó and $54 million the following year, $58 million in 2005Ė06, and up to $60 million in 2006Ė07. The numbers are all there. So why ask the question? The information has been provided to the member on the first day of this House.
Ms. Duncan: Mr. Chair, the minister just said heís going to balance the budget ó a balanced budget in 2005Ė06. Heís going to spend the surplus in the meantime, and heís going to ó thatís what the member opposite has said for the record. Heís going to bring in a balanced budget in 2005Ė06, and heís not going to amend the Taxpayer Protection Act, and heís not going to answer how heís accounting for public/private partnerships ó just the record of the non-answers received this afternoon.
Hon. Mr. Fentie: Mr. Chair, this is getting quite monotonous, and I think the member opposite is doing her best to try and get my goat, but I think itís pretty obvious thatís not going to happen. She has tried all through this sitting and this session, and itís not going to happen.
Again, I will repeat for the member oppositeís information: we have tabled projections. These are not actuals; theyíre projections based on the best information we have available coming out of all departments and compiled by the Department of Finance.
It shows where we are going in this territory over the next number of years, and if thatís not sufficient for the member opposite, then thereís not much I can do on the floor of this Legislature in attempting to answer her questions when the answers the member wants to hear are not being provided ó they are not receptive. The answers are the answers, Mr. Chair. It may not be the answer the member wants but those are the answers and thatís just the way it is. I canít provide for the member opposite things that arenít factual and I canít provide answers to the member opposite that she feels are the answers required. Iím providing the answers based on the best information I have available and thatís what weíre supposed to do in this House.
Chair: Is there any further general debate?
We will proceed, then, line by line. We will continue on with the Department of Finance.
Department of Finance
Hon. Mr. Fentie: The Department of Financeís total O&M estimates for 2003-04 are just over $5 million. The largest component of the budget is in the area of personnel costs at $4,039,000, or 81 percent of the departmentís budget. The total of $5,003,000 of the budget is split between the treasury function of $4.5 million, Workers' Compensation Health and Safety Board supplementary benefits of $382,000, and bad debt expenses of $74,000.
On the revenue side, the Department of Finance has included estimates in this budget of $51.3 million for 2003-04. The majority of this revenue is in the area of personal and corporate income taxes, which respectively make up $31.6 million and $4.9 million of the total revenues. The largest revenue sources for the government are tobacco taxes, estimated at $6.7 million, and fuel taxes, which are also in the $6.7 million range.
The capital budget for the department in 2003-04 will be $266,000. The majority of the capital is made up of an amount of $250,000 for loan guarantee contingencies, which is offset by a capital recovery of an equivalent amount. The remaining $16,000 is for furniture, equipment and systems.
Returning to O&M expenditures, other than personnel costs, the major operating costs of the department are in the area of banking costs, $50,000; printing costs for budget and public accounts documents, $53,000; travel, $50,000; communications and advertising costs of $34,600; general supplies and program materials, $60,500.
The departmentís FTEs for the year have increased to approximately 53 from 2002-03 levels of 50 because of the repatriation of HRIS payroll staff back to Finance and expanded payroll functions in anticipation of the devolution impacts and work levels.
Some of the growth has been offset by reallocations of vacant positions from other areas. In the upcoming year, the department will be undertaking systems development work on the government accounting system. This is necessary because the current financial system is no longer supported by the original vendor.
The department will also be doing a significant amount of work leading to the formula financing renewal. As well, the department will lead the work between the three territories and the federal government in implementing the fiscal components of the health funding accord that was recently agreed to by the Prime Minister. The mandate requires that work be finished by March 31, 2004.
Mr. Chair, I would be pleased to answer further on the departmentís budget in general debate.
Mr. Fairclough: I only have a couple of questions for the minister.
The Department of Finance puts together the long-term revenues and projections for the government. I heard the Premier say that, in the past, our total revenues would be decreasing, but in the long-term projections, they are increasing. Can the minister explain exactly why weíre seeing such an increase in revenues? Is it because of an increase in activity in the development sector ó the mining and oil and gas sectors? Or, is it this strictly on revenues generated out of what he just raised ó corporation and tobacco taxes, and taxes in general?
Hon. Mr. Fentie: First, the decrease is relative to where we could have been, except for the loss in population. If we had not lost 3,000 people, for example, our revenues would have been much higher. The best information that we have available over the long term are nominal increases, but that is mostly due to outside pressures and what is happening in other provinces.
For example, if there are tax decreases in provinces, it will provide a limited upward pressure on our revenues through the formula. If there are increased provincial or local expenditures, it will provide a bit of an upward pressure. But overall, when we look at spending in conjunction with revenues, our spending was far exceeding our ability to sustain that spending, based on revenues and, over the last number of years, due to loss of population, our revenues have declined.
If we added up the total ó these are approximates ó a loss of 3,000 people could very well equal approximately a $30-million to $40-million decrease here if we had not lost the population.
Mr. Fairclough: I guess I have to admit that I fully donít understand exactly how that works ó a decrease in population and how we get an increase in revenues because of how formula financing is being applied to other provinces.
The fact is that we do have an increase in revenues every year. What I didnít hear from the Premier is that it is due to increased activity in the territory. Are these projections strictly on the status quo of the Yukon today, or are we seeing an increase in population due to increased activity in the territory?
Hon. Mr. Fentie: These are based on the existing population, the best available information on whatís happening outside the territory ó for example, information coming from Revenue Canada, those types of things ó but itís certainly not due to an increase in population here. Weíre using all the best available information that we have and weíre realizing some increases because of whatís happening in provinces and other jurisdictions. Then, of course, weíll have to reflect what weíre getting from the health care monies because we have increased that and, once we know what the final analysis is, it will have to be booked and that may change these, to a very limited degree but, for the most part, weíre only dealing with the information at hand.
Mr. Fairclough: Okay, Iím basically going on not the transfer of monies from Canada but the territorial revenues, and there is an increase from our present fiscal year to 2006-07 of close to $7 million. I asked whether or not itís due to an increase in activity. We have seen how we have increased the revenues in taxes with the tobacco tax ó that was an increase of about $2 million a year.
Is the Premier looking at any more revenue generated from increases to taxes?
Hon. Mr. Fentie: There are some projected increases. For example, given whatís happening with natural gas, revenues could increase there. Theyíre shown to be up. Other areas where we see increases are in motor vehicle licence fees and those types of things that were implemented by the former government; they show a bit of an increase here. And it could come from other areas. We could get, as projected, a 16-percent increase in liquor profit. These are all projections, though, based on available information that shows that the possibility of these increases are there, but weíll have to wait until the actuals come out. At the end of the day, weíre only dealing with estimates.
Mr. Fairclough: We see there are going to be increases in personal income tax. I would think that that would be part of having some population come back to the Yukon Territory. There has been an increase over the previous year that is reflected in this budget, and it is over $1 million ó $1.5 million. I would like to be clear on this, on how the numbers are going up in the revenues. I can see that the territorial revenues could balloon, should we have some increase in activity in the territory ó for example, one more gas well thatís producing in the territory.
Iíll leave that. If the Premier has additional information for us and would send it by way of legislative return, weíd appreciate that ó the breakdown in the total amount of revenues over the next four years as laid out in the long-term plans.
I would like to know what is happening now with the immigrant investor fund. It has gone toward Connect Yukon. There are some overcosts in that. It has come to the point where Yukon needs to be paying some of that money back, or a portion of it. Whatís happening with that? Give us an overview of it.
Hon. Mr. Fentie: First, I just want to touch on one thing. When the member opposite alluded to personal tax, this information is coming from Revenue Canada. So, the increase projected is based on information that Revenue Canada has supplied us with. For instance, if we raised wages through a collective bargaining agreement, then we would increase revenues, but there is a clawback offset here with the federal government. So, at the end of the day, we donít really gain in that particular regard.
However, as far as the balloon payment, next year, 2004-05, with respect to Connect Yukon, we will have a balloon payment thatís due. I donít have the exact amount here, but it commences next fiscal year, and it is factored into the long-term projections here.
Mr. Fairclough: That comes right out of the general revenues of the Yukon government?
Hon. Mr. Fentie: Yes, it does. We have to pay it back, but thatís where it comes from. The balloon payment is next year, in 2004-05.
Mr. Fairclough: Maybe the Premier can refresh our memories. In the agreement, how long will it take to have this money paid back, and how much is it?
Hon. Mr. Fentie: Those are details that weíll have to compile because some payments have been made, and we want to determine what is going to happen post-period after that balloon payment. Weíll put together the details and provide them to the member opposite.
Mr. Hardy: Thank you, Mr. New Chair ó itís the first time Iíve seen you. He is so far back there that I can see that far.
I was just looking at some of the major territorial and provincial tax rates. Under manufacturing and processing, we have the lowest tax rate by a substantial margin. Under tobacco, we have the fourth lowest. Under unleaded gas, we have the second lowest and under diesel fuel, we had the lowest.
Are there any intentions of looking at the tax rates to harmonize them closer with, letís say, our northern colleagues in Nunavut and N.W.T.?
Hon. Mr. Fentie: Our commitment is not to raise taxes. Our preferred route is to increase population, thereby increasing the tax base.
Mr. Hardy: So I can be assured that the accord that this minister signed with the N.W.T. has nothing to do with any type of harmonization of tax rates?
Hon. Mr. Fentie: No, it has a lot to do with reciprocal arrangements for benefits for our citizens. It begins with the work that we commenced on health and we will continue on in a number of areas.
The ministers of Education are now working in a pan-northern approach. We have other initiatives that we are going to be working on collectively with the territories. The fact now that we have the possibility of involving ourselves in oil and gas development on the other side of the border is important to our contracting community.
We have a lot to offer in road building for the N.W.T., who, historically, look southward, but through our arrangement, will now look toward the Yukon for the possibility of contractors who are more than capable of taking care of their needs.
I think itís a good thing. A pan-northern arrangement will provide a lot more benefit than if we were working in isolation of each other.
Mr. Hardy: I have a question with respect to the many things the minister had said when he was in opposition regarding the licensing fee increases that the Liberal government had brought in. I think at that time he even said that they were a tax increase.
Now that he is actually in the driverís seat, is he willing to rescind those licensing fees, service fees?
Hon. Mr. Fentie: Mr. Chair, we did not increase fees or taxes. We are dealing with a fiscal situation that has us very close to the line, so we have no intention right now to look in those areas but we have extended the mineral tax credit, for example, which has, I think, been received very well by the mining industry.
Just before the member gets up and talks about the year extension on assessment work, thatís not taxes. If assessment work isnít done, itís a fine, basically, that must be paid, but to determine any amounts we would have to wait until the one-year extension is up to see what assessment work was not completed.
Mr. Hardy: Iím glad the members opposite are knowledgeable of the English language and what it actually means, because theyíre sure not demonstrating it over the last few days, as to what "tax" and "assessment" mean.
However, the question was very simple. Will the minister answer the question: is he willing, based on his words toward the Liberal government when he was in opposition, is he willing to rescind those increases the Liberals brought in? Yes or no.
Hon. Mr. Fentie: I just answered that, Mr. Chair, and I said we have no intention at this time, dealing with the fiscal situation weíre in.
Mr. Hardy: Then I can assume that he approved of those increases and he approves of them now, which is kind of hypocritical, if I have ó
Chair:Order please. Calling a member "hypocritical" is clearly out of order, and Iíd ask the member to withdraw that remark.
Withdrawal of remark
Mr. Hardy:Thank you, Mr. Chair. Of course, Iíll withdraw it. I am totally chastised for saying that.
Can the member tell me what is happening with the loans ó bad loans, whatever you want to call them ó the loans that have been in the paper recently and where weíre at with them and what progress has been made?
Hon. Mr. Fentie: Well, as we said, weíd review our options. This isnít an easy situation to deal with. Itís a situation where we have NGOs involved. We have companies that are in difficult financial situations. There are a lot of factors here, and we have developed a discussion paper, and there will be a Management Board submission coming forward.
At the end of the day, itís an interesting scenario, given the fact that previous governments chose not to deal with this issue. There was no direction by previous governments to deal with these delinquent loans ó none whatsoever. On the other hand, on behalf of Yukoners, we have directed the department to bring forward the options, and we are proceeding in that light.
Mr. Hardy: Contrary to the ministerís vast knowledge, some work was done when the NDP was in government. Possibly he doesnít remember that or maybe he wasnít involved in it. If he reviewed some of the history, heíd realize that the NDP had sat down and discussed some of the loans and tried to work out some options for payment. He doesnít have to look very far to find out who the NDP had talked with about some of those loans.
INTRODUCTION OF VISITORS
Mr. Hardy:Excuse me for a second. With the leave of the House, Iíd like to recognize my wife and former Member of Parliament, Louise Hardy, and my darling little granddaughter, Ellazora. Thank you. Now, back to business, right?
Could the minister tell me if there have been any meetings with the people who have these loans to try to work out some kind of resolution to them, in a manner that recognizes, of course, that some of them may have some difficulties, but others may be able to pay them?
Hon. Mr. Fentie: We are in constant contact with people who owe money. I read the procedure on the floor of this Legislature. The Member for Kluane might think this is funny, but itís not. There are some difficult circumstances out there. The Member for Mayo-Tatchun has a very difficult circumstance to deal with. One of the finest facilities in Mayo is involved here, and there are many others, including NGOs.
We have said all along with respect to this issue that we have no intention of bankrupting people and putting NGOs in a situation where they can no longer deliver the good works they do to the Yukon public. So weíre taking our time in addressing this situation, and weíll do so accordingly.
No matter what, the money is owed. It was an extremely questionable process, embarked on by a former NDP government, in loaning this money. There are all kinds of different arrangements, and itís a difficult process to work through. Itís not a cut-and-dried loan contract, the same with each and every entity out there that owes this money. There are a number of problems with this, so we have to deal with them and come up with options that will work to ensure we donít put people into bankruptcy and, at the same time, bring closure to this issue.
Mr. Hardy: Well, I do agree with the minister opposite in that he is definitely in constant contact with people who owe money. Thereís no debate about that, and we donít have to go around on that. Iím sure he talks to them daily.
I think what we need to know, and what the public is looking for, is some indication that there is work proceeding on this. I think it would be really good if the Yukon Party government would inform the public what is happening, what stage it is at. Everywhere I go, Mr. Chair, Iím asked about this. Itís a major issue for the people of this territory. The onus is on the government to respond to that kind of curiosity and accountability the people of the Yukon want.
Hon. Mr. Fentie: At the risk of being repetitive, Iíll provide the answer again to the member. Weíve received a discussion paper of options from the department. Iíve given the department direction to bring back a Management Board submission. Thereís an update, not only for the official opposition, but also the public.
Mr. Hardy: I really look forward to a ministerial statement on this one from the minister opposite.
Mr. Chair, my question for the minister: who does the collection? If a department is owed money through some activity with an individual or NGO or a business, and they are unable to collect that money, even though there is an agreement in place, who takes over the collection of it? Does it come back to the Finance department to deal with, does it stay within the department, or is it farmed out to a collection agency?
Hon. Mr. Fentie: Mr. Chair, the Department of Finance has the responsibility for the collection of all outstanding loans or debts. This particular issue that the member opposite is alluding to, though, originally was housed in the Department of Economic Development and was transferred to the Department of Finance, and we have discussed that already today on the floor of the Legislature. It will be staying, in terms of the collections, in the Department of Finance.
Mr. Hardy: Are there different methods of collecting money, depending on from which department it comes or depending on what the agreements are? Is there a different process that the Finance department uses based on different scenarios?
Hon. Mr. Fentie: Under normal circumstances, if money wasnít recovered or a payment wasnít made, things would be sent out to a collection agency.
But in this particular instance we are, as stated earlier ó not only today, but in this sitting ó going to review the options available to us because of the circumstances many Yukoners find themselves in with regard to this particular loan program ó the former economic development arrangement. We are going to take the time to do what is necessary so that we do not bankrupt Yukon companies, so that we do not compromise NGOs and so that we can bring closure to this issue.
That is why the discussion paper was developed, and now direction has been given to bring forward a Management Board submission.
Mr. Hardy: Is the collection agency one of the options that is being discussed?
Hon. Mr. Fentie: Mr. Chair, itís customary to allow a government to go through its processes of decision making. When we have concluded that process, we will advise this House and the public what the options are and the decision with which weíll proceed.
Mr. Hardy: Iíll repeat the question: is the collection agency one of the options being considered? Iím not standing here telling the minister what should or should not be in the discussion paper. Iím not implying that a collection agency should be or shouldnít be an option. Iím just wondering, since itís already used for other methods to collect money, is it one of the options in the discussion paper, or is it one of the options being considered by Management Board?
Hon. Mr. Fentie: Mr. Chair, all options are being considered. Obviously this would be one of them.
Mr. Hardy: Can the minister tell me what kind of timelines heís looking at before the public will know what direction this governmentís going in to resolve this outstanding issue?
Hon. Mr. Fentie: First, weíll go through the process of the Management Board decision and take it from there in due course.
Mr. Hardy: Could the minister give me an idea of where weíre at with our bank agreements? What is the time frame for the next agreement? Are we doing anything to try to lessen the costs on the bank agreements that we sign?
Hon. Mr. Fentie: We tender our bank agreements. The next tender will be coming due this fall, and weíll know then.
Mr. Hardy: Weíve already talked about the tax break that was given to the miners for this year. My understanding is that if itís not used this year, they have the option to use it next year. Could the minister just confirm that for me, please?
Hon. Mr. Fentie: I wonder if we can confirm ó is this the assessment work or the mineral tax credit?
Mr. Hardy: Itís the assessment tax relief.
Hon. Mr. Fentie: Mr. Chair, assessment work is not a tax. Assessment work is a requirement under our legislation to hold mining claims. If assessment work is not done, then a fine must be paid in lieu of that assessment work being completed. So itís not a tax, and we have provided a year extension.
Mr. Hardy: On this side of the House, among the NDP, the official opposition, we consider it tax relief and we donít find that a bad word. We donít try to change the word. If itís a tax relief, thatís what it is, and if the members opposite feel itís a wonderful thing thatís going to benefit the industry, they should be quite proud of that. Unfortunately, when it was brought in, it was very quiet, and if we wouldnít have stood in the House and asked the question, we were wondering if it was ever going to be announced. So it didnít seem as if the party opposite, the government, was overly open about it.
Yesterday in our discussions, I was asking questions about this in general debate, and we were told that the amount that the federal government collected before this ó and was, of course, devolved to us ó was in excess of $1 million. This is a pretty substantial amount to be able to give, based on the activities in the industry, especially when the government has talked so strongly about financial difficulties and the precipice that they are dangling from in financial costs.
The concern, I guess, that I have around this, and the concerns that I have heard from other people ó and I really have to say it in here; I think itís important that the members opposite hear it, as well as other people on this side ó and what is considered by many businesses that are also struggling is whether they are going to have tax relief of some form over the next year.
There are many, many businesses out there, besides the miners, that are struggling. The people across the way have articulated ó
Some Hon. Member: (Inaudible)
Mr. Hardy: Does the member want me to report progress?
Mr. Chair, I move that we report progress.
Chair: Mr. Hardy has moved that Committee report progress on Bill No. 4, First Appropriation Act, 2003-04.
Motion agreed to
Speaker resumes the Chair
Speaker: I will now call this House to order.
May the House have a report from the Chair of Committee of the Whole?
Mr. Rouble:Mr. Speaker, Committee of the Whole has considered Bill No. 4, First Appropriation Act, 2003-04, and has directed me to report progress on it.
Speaker: You have heard the report from the Chair of the Committee of the Whole. Are you agreed?
Some Hon. Members: Agreed.
Speaker: I declare the report carried.
Hon. Mr. Jenkins: Mr. Speaker, I move that the House do now adjourn.
Speaker: It has been moved by the government House leader that the House do now adjourn.
Motion agreed to
Speaker: This House now stands adjourned until 1:00 p.m. tomorrow.
The House adjourned at 6:00 p.m.