Mr. Allooloo, as Minister of Transportation, do you have any opening remarks?

Minister's Opening Remarks

Thank you, Mr. Chairman. I am pleased to present the Members of the Legislative Assembly with the 1992-93 capital estimates for the Department of Transportation. In October 1990 the NWT transportation strategy was tabled in the Legislative Assembly. The strategy deals with transportation as a key component in meeting the economic, social and political needs and aspirations of the people of the NWT. This strategy recommends major capital expenditures for improving and expanding our transportation facilities. Its detailed proposals offer a guide for the investments of both the federal and territorial governments in northern transportation.

Within the mandate of the territorial government, the proposed capital estimates for next year follow directly from the objectives set out in the NWT transportation strategy. For those parts of the strategy that still belong to the federal mandate, I will continue, as your Minister of Transportation, to press the federal government on delivering its responsibilities in the North.

The capital estimates propose expenditures of almost $11 million on community airports. We must replace or rehabilitate worn out maintenance equipment. The department will finish the runway rehabilitation projects at Gjoa Haven and Spence Bay and begin runway work in Sanikiluaq and Repulse Bay. There is work to be done on the air terminal buildings at Arviat, Igloolik, Rankin Inlet and Coppermine. A garage will be built in Holman, and the runway extension will be completed in Chesterfield Inlet. Work will continue on the new airport at Snare Lakes.

The department will complete the new airport in Rae Lakes and continue with the new airports in Paulatuk, Snowdrift and Lac ]a Martre. Through a contributions agreement with Transport Canada, the NWT recovers from the federal government 50 cents of every dollar the department spends on these projects.

We will be spending over $22 million on the highway system, including the ferries. Funds must be set aside for the replacement and rehabilitation of maintenance equipment and facilities. The new ferry at Fort Simpson will be launched this summer. Work will continue on a major upgrading program of the arterial highways between Enterprise and Fort Providence and north to Rae-Edzo. Work is also planned on the Dempster Highway, the Fort Smith Highway near Hay River and the highway near Yellowknife.

Just over $300,000 will be spent on new roads in the new year. Between Fort Simpson and Wrigley, work will start on the Willowlake River bridge. Once the bridge is ready, the ferry in service at Fort Simpson, the M.V. Johnny Berens, will move to Camsell Bend. This will open the Mackenzie Highway as far as Wrigley for year-round, all-weather use. The Mackenzie Highway extension is scheduled for opening in the summer of 1994.

The responsibility for any more new road projects remains with the Government of Canada. The department will continue to pursue negotiations with the federal government to win its long-term commitment to new northern roads.

Five hundred thousand dollars is scheduled for the construction of the community access roads. Plans for the new year includes completion of the Swan Lakes road in Gjoa Haven. The department will also continue bringing the winter road at Jean Marie River up to fair weather status.

Community marine facilities may support sealift, commercial fisheries or local small aircraft activities. The community wharves program aims at giving shelter to small boats in the communities. Facilities for sealift and commercial fisheries are federal responsibilities. The proposed estimates include almost one million dollars for community wharves. This year, the department will finish the breakwaters in Arctic Bay and Sanikiluaq and continue with the breakwater projects in Broughton Island, Gjoa Haven and Igloolik.

The Department of Transportation is working with the federal government departments that have marine responsibilities in the Arctic. We are pushing the federal Department of Fisheries and Oceans to proceed with a major harbour development at Pangnirtung. The department is working with Fisheries and Oceans and the Coast Guard to establish the possibility of bringing the sealift to Pelly Bay. It will continue to show both Fisheries and Oceans and the Coast Guard where communities are in need of improved sealift landings, harbours and wharves.

In brief, Mr. Chairman, these are the highlights of the Department of Transportation's proposed 1992-93 capital program. In delivering its programs, the Department of Transportation uses its expenditures as opportunities to stimulate and to promote northern and local training, employment and business ventures.

In the first 11 months of the past fiscal year, the department awarded 490 contracts with a value of $46 million. The northern content value of these contracts was $39.5 million, representing 86 per cent of the total project expenditures. Almost half the northern content component, $18.8 million, went to local contractors and subcontractors. Next year the department will strive to do even better in advancing local training, employment and business opportunities. We will also carry on next year with our efforts to remind the federal government of its responsibilities for northern transportation.

Mr. Chairman, as the Minister of Transportation, I think this is a worthwhile and important capital program for the future of the Northwest Territories. I hope the Members will agree and give their support for our proposal. Thank you.

Thank you, Mr. Minister. Before I ask you to bring in your witnesses, we will have a five minute break.

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Will this committee come to order? I wonder if the Minister would like to bring in witnesses. Mr. Minister?

Thank you, Mr. Chairman. With your permission, I would like to bring in some witnesses.

Does this committee agree?

Agreed.

--- Agreed

Agreed. Mr. Minister, for the record, could you introduce your witnesses?

Thank you, Mr. Chairman. To my right is the acting deputy minister of Transportation, Mr. Andrew Gamble.

Thank you. I wonder if the chairman of the finance committee would like to make an opening remark. Mr. Todd.

Comments From The Standing Committee On Finance

Thank you, Mr. Chairman. There are only a few remarks with respect to Transportation. The Minister of Transportation indicated that the transportation planning activity for 1992-93, which is approximately $26,000,000, was entirely comprised of enhancements. One of the problems we had with this was the difficulty in justification for the expenditures. In other words, how do you quantify some of the reconstruction of highways in Yellowknife, the Jean Marie access road, and things of that nature? Our concern was not that transportation is not a critical component to the northern economy but that at this difficult time these enhancements, adding to existing infrastructure, given some of the financial difficulties we have -- maybe that money should be put somewhere else. We believe, as we said, with the capital budget, that Transportation is potentially, as is MACA and other departments, a significant economic instrument, but we had some difficulties in seeing where the department linked their expenditures and their financial instruments together. While, as the Minister said, the department boasts a high degree of northern content in its projects, we did observe some major contracts going to southern suppliers. For example, there was a $2.3 million contract that went to Carmacks Construction for asphaltic surfacing of Highway No. 1. Although the department did maintain that the company used northern labour, we still believe there must have been a significant leakage of dollars, whether it was in tax dollars, et cetera, to the South.

With respect to Transportation's budget, we are going to recommend in general resolutions that cabinet re-examine priorities from a cost-benefit analysis in light of other fundamental needs. Do you pave a highway, or put water and sewer into a place? Those are the kinds of issues that we talked about. We think the department should use its capital budget to ensure that there is maximum benefits to Northerners -- employment and training we have all talked about -- but I think the department has a responsibility, not just to develop a transportation infrastructure, but to ensure that transportation infrastructure and policies clearly meet the needs of the training and employment components of Northerners.

The other concern was that the Transportation infrastructure be approved, where it can be substantiated that it is conducive to the development of industry. What we mean by that is, the Pangnirtung situation where you have got a fisheries industry, yet we understand the runway does not have the capacity to haul out a 748 loaded with fish. Do you know what I am saying? There have to be some linkages, I guess, between some of the developments that are taking place in the country, whether it is fisheries or logging or whatever, with the Department of Transportation. I guess that is what we are trying to say here. If, for example, the Pangnirtung fishery is a significant economic instrument that provides long-term jobs to Northerners, then when the Department of Transportation looks at its capital budget it should keep that in mind if there is a requirement, for example, for expanding the runway, whether or not it can be done, et cetera. Right now, what is happening is, in that particular example, they are not able to haul full loads of fish out.

The last point we would like to make is, the department re-evaluated standards to ensure they are reasonable in light of what this government can afford. This is consistent with what we said to all departments. If all you can afford is a Ford, let us make sure you buy a Ford and not a Cadillac. I do not think our position is any different here than it has been with MACA or any other departments.

Enhancements should be justified on their return. There has to be some way to quantify why we are hard-topping a highway, why we are building a road, et cetera. Thank you.

Thank you. General comments. Member for Thebacha.

Thank you, Mr. Chairman. My constituency is fortunate to have one of the highways available to them. Our highway has been in place for well over 20 years, and even though I recognize it is a fairly good gravelled highway, I believe it has been overlooked by the Department of Transportation in their planning. We have

recognized that many highways, particularly from the border into Hay River, into Pine Point, have all had the opportunity of paving. The highway to Providence and along into Yellowknife is getting the opportunity of being totally reconstructed and paved, in order to formulate a good baseline. The Highway No. 5 that I am speaking of, in respect to the Pine Point junction, Buffalo River junction where there is a highway camp there, into Fort Smith, has had some pavement, very little pavement. However there is gravel from Sandy Lake into Fort Smith.

In question period in this House I have asked the Minister about Highway No. 5. It been a gravel highway with some hard-top pavement from Bell Rock to Fort Smith, which is only about eight miles out of the community. I asked if there was any intention to further pave the highway because they have paved in all other parts of the Territories.

I think the concern I have here -- and I recognize the fiscal dilemma and the environment we are in -- however, at the same time there are many highways being paved with no actual plan by the department. I believe the department is basically saying they are being paved because of the demand. Well, you can argue that point because generally a paved highway will warrant more usage, would like more usage, but it appears that this is being overlooked. There arena plans in the department's budget, except for $900,000 which states Highway No. 5, kilometre zero to 60 for actual overlay on the cold mix or hard-top that they have now. But that is not even toward the Fort Smith highway, it is from Hay River to the Pine Point junction. And there are no future plans for addressing this particular highway from the Buffalo River junction to Fort Smith.

I am concerned that not only are there no plans to address this particular highway with hard-top paving, but I am also concerned whether or not the maintenance of that particular highway and possibly even the highway from Pine Point into Resolution will even be maintained in future years.

So I would like to know, in respect to the department's plans, whether they have reconsidered at all whether or not they can address the concern on Highway No. 5, from the Pine Point junction into Fort Smith.

Mr. Minister.

Thank you, Mr. Chairman. Our plan at the current time for Highway No. 5 is to pave it at some point in the future, but our immediate plan, as the Member stated, does not take into account paving in the near future. We plan to do some paving starting in 1997.

Mrs. Marie-Jewell.

Thank you, Mr. Chairman. Looking at the concern and recognizing that the highways have been paved, basically, to address the issue of safety and to address the issue of ensuring that we try to place forth proper highways in the Territories, and recognizing that Highway No. 5 does have a good solid base, it is not like many of the other highways where the base has to be dug up and re-formed. I would like to know if the Minister would reconsider and look at the highway needs in respect to paving, prior to 1997.

The concern I have is that this highway has been partially paved away back in 1984 and nothing has been done since then. You travel from the Pine Point turnoff into Fort Smith and you go 30 miles of pavement, and all of a sudden by Sandy Lake it comes to a dead halt and you go onto gravel. I do not think that is proper planning. Would the Minister reconsider finishing up what they started to do in 1984, prior to 1997?

Mr. Minister.

Thank you, Mr. Chairman. We could review our projections for paving Highway No. 5 but based on the cost and benefit analysis point of view.

Member for Thebacha.

Mr. Chairman, I do not know if I got an answer that he would like to but because it is based on the cost and benefit or will he reconsider looking at that item?

Mr. Minister.

Thank you, Mr. Chairman. We have been told by the standing committee on finance throughout this capital budget review that we have to quantify or justify the projects, and also show some sort of a balance for the money we are spending on the projects, we have to justify it; and in our information at this point, the areas where we need to spend our money, is to maintain what we have in terms of capital projects, replacing the maintenance equipment, and also improving and maintaining roads where the traffic is the greatest. Our figures show that the area that we need to work on the most is the Mackenzie Highway from Enterprise and up Highway No. 3 arterial highways, and what I am saying to the Member is that, yes, we will look at Highway No. 5, but if we are going to pave it we will have to look at the cost and benefit factors of paving the highway. Thank you.

Thank you. Member for Thebacha.

Thank you, Mr. Chairman. I am cognizant of the fact that the SCOF did ask them to quantify their projects, but the point I am trying to make to the Minister is the fact that Highway No. 5 has been partially paved for the past six years, if not more -- seven years. All of a sudden, in the middle of nowhere along that highway, you have the pavement come to a dead end and you go back onto gravel, and there does not seem to be any planning to address the remaining portion of that paving. It is not as if I am talking about a highway cost when you compare it to the Yellowknife highway, or the Providence highway, where you have to fix up a whole new base. The base on Highway No. 5 is an excellent base, and the cost to place the paving and complete the project they started would not be comparable to those other highways. I want the Minister to be conscious of that.

The other concern I have is in respect to basically saying, "depending on the demand on the highway." Well, everyone knows that you prefer to drive on a paved highway rather than on a gravel highway, so there is no doubt the demand on the highway between the border and Hay River, or the border and the old Pine Point road, or the border and Providence or Yellowknife will be a lot greater, because people would prefer to go on a paved highway rather than a gravel highway. So how can you get the demand up if you just have a gravel highway to drive on? But I guess what I am concerned about is that there is no indication of this department completing the job they started seven years ago, even though I recognize they were not a department then, but the government had placed paving on that highway and they have not completed it, and there is no indication that they are even going to make attempts to complete it. Initially, why did they pave it if they decided they were not going to finish it? This is why I would like to get come indication as to how the Minister is going to address it.

I do not feel it is fair that as residents we should have to wait until 1997 to ask the department to try to finish up the job they started away back in the middle of 1980. I think it is only fair that we can ask them to complete the job that they started. So I can get some indication as to the Minister's viewpoints on this, Mr. Chairman.