Thank you, Mr. Chairman. Mr. Chairman, the purpose of the Write-off of Debts Act, 1993, is to authorize the write-off of certain debts listed in the schedule to the act. Pursuant to the Financial Administration Act, the write-off of government debts exceeding $20,000 must receive Legislative Assembly approval. The write-offs will be charged against allowances for bad debts which were established by departments in previous budgets at the time it was determined that collection of the debts would be unlikely. Therefore, the write-offs being proposed in this act will not require a new appropriation. Details of the individual debts being proposed for write-off have been provided to the Standing Committee on Finance. Thank you, Mr. Chairman.
Debates of March 30th, 1993
Topics
Bill 23: Supplementary Appropriation Act, No. 4, 1992-93
Item 18: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 1290
John Pollard Hay River
Bill 23: Supplementary Appropriation Act, No. 4, 1992-93
Item 18: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 1290
The Chair John Ningark
Thank you. Mr. Dent.
Comments By Standing Committee On Finance
Bill 23: Supplementary Appropriation Act, No. 4, 1992-93
Item 18: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 1290
Charles Dent Yellowknife Frame Lake
Thank you, Mr. Chairman. I have some comments from the Standing Committee on Finance. Mr. Chairman, the Standing Committee on Finance reviewed the Write-off of Debts Act at its meetings in Yellowknife on March 22 and March 23. The Minister of Finance and his staff were available to answer questions at that time.
The standing committee recognizes that the purpose of the Write-off of Debts Act is to authorize the write-off of certain government debts exceeding $20,000. The committee realizes that the write-offs being proposed in this act will not require a new appropriation. Allowances for bad debts were established by departments when it was determined that the collection of the debts would be unlikely. As well, the committee understands that even though these debts are being written off the government will continue to pursue them to the statute of limitations.
However, the standing committee did have some concerns about the government's business practices in relation to the write-off of debts. In some situations, even though a company had more than one loan the government is proposing that only one be written off at this time. The committee suggested that the government consider consolidating all loans for a particular company when it becomes evident that the payment of debts is unlikely.
The committee expressed concern about the criteria used to qualify for government loans. The government assured the committee that the criteria for loan qualifications have been tightened since the time that these loans now proposed for write-off had been granted. The committee questioned particular situations where the government loaned money to companies which were known to be suffering financial difficulty. The government indicated to the standing committee that when they offer assistance to ailing companies in this day and age, they make sure that a good business plan is in place and that the company has sound business policies and practices.
In one situation where the write-off of debt is proposed there was no back up information in the government files. The government assured the standing committee that, at the present time, no loan is granted without all the required paper work being in place. Having satisfied itself that steps have been taken by the government to minimize the number of bad debts, the standing committee recommends this bill to the House for consideration. Mahsi, Mr. Chairman.
Bill 23: Supplementary Appropriation Act, No. 4, 1992-93
Item 18: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 1291
The Chair John Ningark
Thank you, Mr. Dent. General comments on the bill. Agreed? Write-off of Debts Act, 1993, do we agree to go clause by clause?
Bill 23: Supplementary Appropriation Act, No. 4, 1992-93
Item 18: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 1291
Some Hon. Members
Agreed.
---Agreed
Clause By Clause
Bill 23: Supplementary Appropriation Act, No. 4, 1992-93
Item 18: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 1291
The Chair John Ningark
Clause 1. Mr. Koe.
Bill 23: Supplementary Appropriation Act, No. 4, 1992-93
Item 18: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 1291
Fred Koe Inuvik
Are we going through detail first, Mr. Chairman?
Bill 23: Supplementary Appropriation Act, No. 4, 1992-93
Item 18: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 1291
The Chair John Ningark
There are no details in Bill 24. Wait until we come to schedule. Clause 1. Agreed?
Bill 23: Supplementary Appropriation Act, No. 4, 1992-93
Item 18: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 1291
Some Hon. Members
Agreed.
---Agreed
Bill 23: Supplementary Appropriation Act, No. 4, 1992-93
Item 18: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 1291
The Chair John Ningark
Thank you. Clause 2. Agreed?
Bill 23: Supplementary Appropriation Act, No. 4, 1992-93
Item 18: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 1291
Some Hon. Members
Agreed.
---Agreed
Bill 23: Supplementary Appropriation Act, No. 4, 1992-93
Item 18: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 1291
The Chair John Ningark
Schedule. Total debts written-off, $580,553.96. Mr. Koe.
Bill 23: Supplementary Appropriation Act, No. 4, 1992-93
Item 18: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 1291
Fred Koe Inuvik
Thank you. I will get used to your system yet. Can I get some detail on Hanavik Arts Ltd.? Why are we writing off $200,000 plus?
Bill 23: Supplementary Appropriation Act, No. 4, 1992-93
Item 18: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 1291
The Chair John Ningark
Thank you. Mr. Minister, on the Hanavik Arts Ltd.
Bill 23: Supplementary Appropriation Act, No. 4, 1992-93
Item 18: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 1291
John Pollard Hay River
Mr. Chairman, the company is no longer in operation and the principle guarantor, Nicholas Lebessis filed an assignment in bankruptcy in November of 1991. At the present time, there are no financial resources available and no recoveries are anticipated. Therefore, we are recommending write-off. I would inform the House, however, that we will continue to pursue this debt. I think the statute of limitations is seven years in this regard, Mr. Chairman. Although we are writing it off we will still continue, if there is any chance of getting the money back, we will do that. Thank you, Mr. Chairman.
Bill 23: Supplementary Appropriation Act, No. 4, 1992-93
Item 18: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 1291
The Chair John Ningark
Thank you. Mr. Koe.
Bill 23: Supplementary Appropriation Act, No. 4, 1992-93
Item 18: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 1291
Fred Koe Inuvik
For the record, can I ask the Minister, when a debt is written off the individual or company still has an obligation to pay. Is that correct? The government can still collect on this amount.
Bill 23: Supplementary Appropriation Act, No. 4, 1992-93
Item 18: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 1291
The Chair John Ningark
Thank you. It is written off, but not forgiven. Mr. Pollard.
Bill 23: Supplementary Appropriation Act, No. 4, 1992-93
Item 18: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 1291
John Pollard Hay River
That is correct, Mr. Chairman. Thank you.
Bill 23: Supplementary Appropriation Act, No. 4, 1992-93
Item 18: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 1291
The Chair John Ningark
Thank you. Schedule, total debts written off, $580,553.96. Mr. Koe.
Bill 23: Supplementary Appropriation Act, No. 4, 1992-93
Item 18: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 1291
Fred Koe Inuvik
Is the Minister saying this company is non-existent and the prime owner is gone?
Bill 23: Supplementary Appropriation Act, No. 4, 1992-93
Item 18: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 1291
The Chair John Ningark
Mr. Minister.
Bill 23: Supplementary Appropriation Act, No. 4, 1992-93
Item 18: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 1291
John Pollard Hay River
Mr. Chairman, the company is no longer in operation. We have recently learned that Mr. Lebessis is believed to be in B.C. Thank you, Mr. Chairman.
Bill 23: Supplementary Appropriation Act, No. 4, 1992-93
Item 18: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 1291
The Chair John Ningark
Thank you. Mr. Koe.
Bill 23: Supplementary Appropriation Act, No. 4, 1992-93
Item 18: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 1291
Fred Koe Inuvik
The second amount, $70,000, Sigyamiut, is this company also non-existent?