Thank you, Mr. Chairman. My question is about the applied arts and library building in Fort Smith. Mr. Chairman, I noted that in the budget in 1989-90, $6.68 million was the projected overall budget. By 1991-92, that had grown to $6.69 million. And I see in our books this year that if you include the future, we're looking at a total of $8.65 million. I would just like to ask the Minister, what has caused this budget to grow by this substantial amount over a short period of time.
Debates of Oct. 20th, 1994
Topics
Bill 1: Appropriation Act, No. 1, 1995-96Committee Report 10-12(6): Report On The Review Of The 1995-96 Capital Estimates
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 416
Bill 1: Appropriation Act, No. 1, 1995-96Committee Report 10-12(6): Report On The Review Of The 1995-96 Capital Estimates
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 416
The Chair John Ningark
Thank you. The honourable Minister.
Bill 1: Appropriation Act, No. 1, 1995-96Committee Report 10-12(6): Report On The Review Of The 1995-96 Capital Estimates
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
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Richard Nerysoo Mackenzie Delta
Thank you, Mr. Chairman. A great deal of it, I think, deals with inflationary costs. Another deals with the program space as part of the two components.
Bill 1: Appropriation Act, No. 1, 1995-96Committee Report 10-12(6): Report On The Review Of The 1995-96 Capital Estimates
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 416
The Chair John Ningark
Qujannamiik. Total region. The honourable Member for Yellowknife Frame Lake.
Bill 1: Appropriation Act, No. 1, 1995-96Committee Report 10-12(6): Report On The Review Of The 1995-96 Capital Estimates
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
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Charles Dent Yellowknife Frame Lake
Thank you, Mr. Chairman. I'm just a little bit surprised by the answer that inflation had to do with this, considering what the inflation rate has been in the last couple of years. Can the Minister advise how much of that increase relates to inflation?
Bill 1: Appropriation Act, No. 1, 1995-96Committee Report 10-12(6): Report On The Review Of The 1995-96 Capital Estimates
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 416
The Chair John Ningark
Mr. Minister.
Bill 1: Appropriation Act, No. 1, 1995-96Committee Report 10-12(6): Report On The Review Of The 1995-96 Capital Estimates
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 416
Richard Nerysoo Mackenzie Delta
What happens is that we calculate the cost of the project. As we get to the actual construction itself, we get firmer and firmer calculations and that's the problem. It's one thing for us to forecast and another to actually expend the dollars, based on the projection.
The other component, of course, deals with the whole issue of other factors. We could be paying additional dollars for the application of the business incentive policy. Those are considerations that are all part of the additional costs to any particular project.
Bill 1: Appropriation Act, No. 1, 1995-96Committee Report 10-12(6): Report On The Review Of The 1995-96 Capital Estimates
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 416
The Chair John Ningark
Thank you. Fort Smith, total region. Mr. Dent; then I have Mr. Gargan. Mr. Dent.
Bill 1: Appropriation Act, No. 1, 1995-96Committee Report 10-12(6): Report On The Review Of The 1995-96 Capital Estimates
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 416
Charles Dent Yellowknife Frame Lake
Thank you, Mr. Chairman. The Minister just mentioned the premium for the business incentive policy. I was just wondering if the department could tell us just what the premium was for the application of the business incentive policy.
Bill 1: Appropriation Act, No. 1, 1995-96Committee Report 10-12(6): Report On The Review Of The 1995-96 Capital Estimates
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 416
The Chair John Ningark
Qujannamiik. Mr. Minister.
Bill 1: Appropriation Act, No. 1, 1995-96Committee Report 10-12(6): Report On The Review Of The 1995-96 Capital Estimates
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 416
Richard Nerysoo Mackenzie Delta
Thank you, Mr. Chairman. We're just trying to make a quick calculation here. Mr. Chairman, I would like, maybe, to respond this way. I think with respect to the project, we are above the premium, you might say, being paid already, to be quite honest with you. But that's the nature
of the way we're conducting the project. That was a decision made about how we would approach this particular project.
Bill 1: Appropriation Act, No. 1, 1995-96Committee Report 10-12(6): Report On The Review Of The 1995-96 Capital Estimates
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 417
The Chair John Ningark
Thank you. Mr. Dent.
Bill 1: Appropriation Act, No. 1, 1995-96Committee Report 10-12(6): Report On The Review Of The 1995-96 Capital Estimates
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 417
Charles Dent Yellowknife Frame Lake
Thank you, Mr. Chairman. I'm just trying to understand this fully. I didn't quite catch what the Minister meant when he said they were already above the premium for the BIP right now. Is the Minister saying that this project is expected to come in higher than this $8.4 million projected budget we are seeing in our books right now? Again, Mr. Chairman, I didn't quite understand the Minister's explanation. Perhaps he could try to make it simpler for me.
Bill 1: Appropriation Act, No. 1, 1995-96Committee Report 10-12(6): Report On The Review Of The 1995-96 Capital Estimates
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 417
The Chair John Ningark
Mr. Minister.
Bill 1: Appropriation Act, No. 1, 1995-96Committee Report 10-12(6): Report On The Review Of The 1995-96 Capital Estimates
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
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Richard Nerysoo Mackenzie Delta
I'm not trying to make it confusing. But there are certain factors that have to be considered. I appreciate the comments made about the inflation issue. Since we even proposed the project, lumber prices have tripled. There are other prices of products that have gone up. That's one of the issues. The other thing is, in some instances, the concept of negotiating directly does cost us a few extra dollars. The application of the BIP costs us dollars.
But, generally speaking, we have been trying to keep within the dollars that have been voted. I'm not going to suggest to the honourable Member that it may be possible. There may be other factors that come in that force us to go beyond it. It is a matter of trying to make adjustments in the capital dollars that you voted for us.
Bill 1: Appropriation Act, No. 1, 1995-96Committee Report 10-12(6): Report On The Review Of The 1995-96 Capital Estimates
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 417
The Chair John Ningark
Fort Smith, total region. Mr. Dent.
Bill 1: Appropriation Act, No. 1, 1995-96Committee Report 10-12(6): Report On The Review Of The 1995-96 Capital Estimates
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 417
Charles Dent Yellowknife Frame Lake
Thank you, Mr. Chairman. I can appreciate what the Minister is saying. I know lumber prices have gone up significantly. But, I also think that, in general, contract prices in the construction industry have gone down during the last few years due to our economy. I would have expected that this would have equalized the inflation rate to almost nothing. In other words, the prices of some groceries have gone up but the prices of others have gone down. Prices across Canada have tended to equal out so there is less than one or two per cent increase in inflation. I believe the construction prices across Canada have done pretty much the same.
I guess I remain unconvinced that there has been a significant increase in the cost of doing construction work in the past few years in the north. Leaving that aside, I would just like to ask, has the department done an analysis of what the premium for BIP is -- which the Minister has mentioned is perhaps one of the reasons for the increase -- and what the negotiated nature of the contracts here has been?
Bill 1: Appropriation Act, No. 1, 1995-96Committee Report 10-12(6): Report On The Review Of The 1995-96 Capital Estimates
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 417
The Chair John Ningark
Minister of Education, Culture and Employment, Mr. Nerysoo.
Bill 1: Appropriation Act, No. 1, 1995-96Committee Report 10-12(6): Report On The Review Of The 1995-96 Capital Estimates
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 417
Richard Nerysoo Mackenzie Delta
Thank you, Mr. Chairman. I apologize to the honourable Member, but the responsibility for delivering the project belongs to the Department of Public Works and Services. The difficulty for me in answering is that we have different interpretations of how the projects are being applied. But, I do want to say that there were other considerations. The unfortunate thing is, we haven't seen all the kinds of reductions in the cost of doing business that the honourable Member has pointed out have occurred across Canada. That has not necessarily been the case for northern business.
That's the unfortunate thing. One component of the BIP still forces us to incur costs that are higher than what other companies would bid. We are not seeing the advantages of the competition that exists across the country. We haven't seen the downgrading of prices. The other thing is, the incentive program has gone up an additional 5 per cent since this project was put into the capital budget, in addition to those that were already proposed. Those are the factors that should be considered.
The actual delivery agent is the Department of Public Works and Services for this project.
Bill 1: Appropriation Act, No. 1, 1995-96Committee Report 10-12(6): Report On The Review Of The 1995-96 Capital Estimates
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 417
The Chair John Ningark
Thank you. Mr. Dent.
Bill 1: Appropriation Act, No. 1, 1995-96Committee Report 10-12(6): Report On The Review Of The 1995-96 Capital Estimates
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 417
Charles Dent Yellowknife Frame Lake
Thank you, Mr. Chairman. I understand that the Minister's department is now responsible for the delivery of the program. I want to make it clear that I wasn't trying to say anything nasty about the BIP, but I think it is important that we understand what the premiums are that we are paying sometimes.
I don't think there is anything wrong with getting them on the table for public awareness. That was the sort of information I was looking for. I thought the Minister's department might have an assessment of this. Knowing that dollars are budgeted within their department, it would seem to follow that, if prices go up, whether because of inflation, the BIP, or negotiated contracts or any other factor, the size of the project may have to be decreased. That was really what I was going to ask. Has the scope of this project been decreased since it was originally proposed?
Bill 1: Appropriation Act, No. 1, 1995-96Committee Report 10-12(6): Report On The Review Of The 1995-96 Capital Estimates
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 417
The Chair John Ningark
Thank you. Mr. Minister.
Bill 1: Appropriation Act, No. 1, 1995-96Committee Report 10-12(6): Report On The Review Of The 1995-96 Capital Estimates
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 417
Richard Nerysoo Mackenzie Delta
Thank you. Mr. Chairman, I thank the Member for the comments he made. Yes, the project has been decreased by 17 per cent from the original proposal.
Bill 1: Appropriation Act, No. 1, 1995-96Committee Report 10-12(6): Report On The Review Of The 1995-96 Capital Estimates
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 417
The Chair John Ningark
Qujannamiik. Mr. Dent.
Bill 1: Appropriation Act, No. 1, 1995-96Committee Report 10-12(6): Report On The Review Of The 1995-96 Capital Estimates
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 417
Charles Dent Yellowknife Frame Lake
Thank you, Mr. Chairman. Would it be possible to get a bit more information on that? For instance, does the 17 per cent mean that the size of the building has gone down by 17 per cent, or have we, perhaps, selected something that was to be included in the building and decided not to include it? I know that one of the things that was going to be in this facility was the Social Services program building, which were originally ATCO trailer units. I know it was proposed that we replace them. Are we still going to be able to replace them? Did we reduce everything, or did we pick one area and decide not to include it in this building?