Thank you, Mr. Chairman. Generally, the equipment is replaced on the following basis. Small

equipment such as motor toboggans is replaced after three years. Passenger vehicles are replaced after five years or 100,000 kilometres, or whichever comes first. Heavy equipment is replaced after eight years or 16,000 hours of operation, or whichever comes first. Before deciding on replacement as stated above, an inspection is carried out to assess the condition of the equipment. If the condition is found to be good, the replacement is postponed in the interest of economy. In addition, the client department is requested, before replacement, to reassess its need to replace in order to conserve government funds.

The equipment is sometimes replaced before reaching the age, mileage, hours of operation as stated above due to exceptional circumstances. For example, a unit may be beyond economic repair; the unit may present a hazard to the operator or its passenger; the unit has been involved in an accident resulting in major damage; or, the unit is no longer suitable for its original purpose.

As a result of the restraint exercise on replacement as described above, we have a large number of equipment items older than the recommended replacement age as stated above, as follows. Fifty per cent of the small equipment is older than 1987; the average year is 1983 -- seven years old. Thirty-three per cent of the passenger vehicles are older than 1985; the average year is 1982 -- eight years old. Six per cent of the heavy equipment is older than 1982; the average year is 1975 - 15 years old. Thank you, Mr. Chairman.