Thank you. Minister of Finance, Mr. Pollard.

Thank you, Madam Speaker. Good afternoon. Madam Speaker, I am aware, yes. Thank you.

Supplementary, Mr. Antoine.

Thank you, Madam Speaker. My understanding of the premise that the Minister's department is using to force the Dene Nation to pay the payroll tax is that a letter was received from the Minister of Indian and Northern Affairs stating that Treaty 8 negotiations had not reached a point where exemptions could be applied. So, at some future date, the Dene Nation would likely be exempt if this is done through negotiations. Why is this happening?

Minister of Finance, Mr. Pollard.

Thank you, Madam Speaker. Madam Speaker, it is happening because the payroll tax is tax that is based on legislation passed through this House and applied to people in the Northwest Territories. The Dene Nation are employers in the Northwest Territories and are, therefore, required to register and pay tax on employees' earnings, deduct them and pass them onto the Government of the Northwest Territories. Thank you, Madam Speaker.

Thank you. Supplementary, Mr. Antoine.

Thank you, Madam Speaker. Was the Minister of Finance approached by the Premier, before she left for China, about backing off on the payroll tax issue with the Dene Nation, so that further negotiations might take place? Thank you.

Thank you. Minister of Finance, Mr. Pollard.

Madam Speaker, the Premier discussed the issue with me and after I had explained to her the lengths that I had gone to with the Dene Nation, the federal government, the amount of meetings there had been, the exchange of letters, et cetera, and I told her that I did not have a way to back off, as Mr. Antoine says, there was no further discussion between the Premier and myself in that regard. Thank you, Madam Speaker.

Thank you. Final supplementary, Mr. Antoine.

It is unfortunate to come to this point, Madam Speaker. However, the Premier did speak with the Minister of Finance to try to slow this process down before it got to the point that it might be reaching now. Is the Minister willing to meet with Bill Erasmus, the chief of the Dene Nation, to discuss

further with the Dene Nation or is the audit still on for tomorrow? Thank you.

Thank you. Minister of Finance, Mr. Pollard.

Madam Speaker, I will be meeting with Mr. Erasmus this afternoon, but I don't have any intention of stopping the auditors from going to the offices tomorrow. Thank you, Madam Speaker.

Thank you. Item 6, oral questions. The honourable Member for Yellowknife North, Mr. Ballantyne.

Thank you, Madam Speaker. I have a question for the Minister of Finance. Madam Speaker, the Northwest Territories are, as most Canadians, are facing the possibility of large government cutbacks. I know the Finance Minister is dealing with this issue. On the other hand, we are moving ahead towards division and inevitably will be incurring incremental costs. What is the Finance Minister, and this government, doing to ensure that whatever incremental costs are incurred by this government, the federal government will live up to its obligation to pay them? Thank you, Madam Speaker.

Thank you. Minister of Finance, Mr. Pollard.

Madam Speaker, as we move towards division, Members of this House realize that decisions that are made now by this Legislative Assembly, may ultimately affect what ends up in a certain part of the Northwest Territories after division occurs. It was raised a few years ago, by Ms. Mike when she was on the other side, about the capital budget, et cetera. So right now we are dealing with issues on a fair and equitable basis. In the meantime, we are saying to the federal government that there will be incremental costs as division occurs and we want you to be aware of them. There will also be costs, if there are aboriginal and self-government negotiations going on that are concluded. There are many issues that, as a result of federal government actions, will result in the people of the Northwest Territories incurring more costs, particularly through division, as Mr. Ballantyne points out.

I have met with Mr. Irwin and pointed that out to him. I have met with our MPs and pointed it out to them. I discussed it at 1:00 this afternoon with the Honourable Ethel Blondin-Andrew. I have written to Mr. Martin and told him of my concerns about incremental costs as division occurs. The last thing that we will be asking for is a process in the next negotiations for the next formula funding agreement. That will be the one that divides in 1999. We are saying there has to be a process set up so that over the next four years these kinds of issues can be

discussed and some decision arrived at. Thank you, Madam Speaker.

Thank you. Supplementary, Mr. Ballantyne.

I thank the Finance Minister for that answer. My concern, and I'm sure the concern of the Finance Minister, is the commitments made in the last couple of years have to be implemented three or four years from now, in what could be a totally different fiscal climate. It causes me some concerns. Madam Speaker, the federal Nunavut legislation, as I understand it, allows the federal government to decide what areas actually would be covered for implementation cost and how much they will pay. So my question to the Minister is, is the Minister having any specific discussions with the federal government to start defining now the areas that will be considered implementation costs by the federal government? Thank you, Madam Speaker.

Thank you. Minister of Finance, Mr. Pollard.

Madam Speaker, as soon as this round of negotiations with the federal government on the existing formula financing agreement and the one that will be in place for the next four years are concluded, we will then move into that area of incremental funding with regard to division issues. I am saying to Mr. Martin, it has to be done sooner than later. It has to be started in year one of the new formula funding agreement for the very reasons that Mr. Ballantyne raises. So I'm hoping that it will start next year, Madam Speaker. Thank you.

Thank you. Supplementary, Mr. Ballantyne.

Thank you. I agree, better sooner than later. My last question to the Finance Minister, I understand it will be a Treasury Board submission in 1995 which will deal with the area of implementation funding for the period 1995 to 1999. My question is, is the Minister intending to have discussions with the federal government to help define what will actually go in that particular submission? Thank you, Madam Speaker.