Thank you. Item 6, oral questions. The honourable Member for Iqaluit, Mr. Patterson.

Thank you, Madam Speaker. My question is for the Minister responsible for Housing. I guess he heard my complaints today in my Member's statement and I was going to give him a little time to prepare to answer, but I'll see what he knows today. My first question, Madam Speaker, is, does the Minister responsible for the Housing Corporation know where the owner of Nova Construction ordinarily lives? Thank you.

Minister of Public Works and Services and Housing, Mr. Morin.

Thank you, Madam Speaker. I think he lives in Yellowknife or some farm in the south. It is either place, I'm not too sure.

Thank you. Supplementary, Mr. Patterson.

Madam Speaker, I think that contractors are becoming ingenious at finding clever ways of getting around the spirit and intent of the BIP. I expect that Mr. Mrdjenovich may keep an apartment here, but he is not listed in the Yellowknife phone book and I'm told he lives on a ranch in Alberta. If he does ordinarily live on a ranch in Alberta, I would like to ask the Minister, how can it be that his company has been given northern preference under the BIP? Thank you.

Thank you. Minister of Public Works and Services, Mr. Morin.

Thank you, Madam Speaker. Nova Construction does get northern preference and the reason for that is they have a company in the Northwest Territories, they have an office in the Northwest Territories, they hire people from the Northwest Territories and it is my understanding that the owner lives in the Northwest Territories. I have heard rumours that he has a farm in southern Canada. I will follow up on that issue. If he is an owner from southern Canada and the benefits are flown to southern Canada, we can possibly deal with that issue. Thank you.

Supplementary, Mr. Patterson.

Thank you, Madam Speaker. I do appreciate that answer. Madam Speaker, related to the issues that arose from the Iqaluit rent supp contract this year, I understand that the materials for Nova for the Iqaluit rent supp job came up on the Rock Lessard barge, not operation sealift Coast Guard vessels, contrary to the tender specifications. I would like to ask the Minister responsible for the Housing Corporation, is he aware of this problem and will action be taken? Thank you.

Minister responsible for Public Works and Housing, Mr. Morin.

Thank you, Madam Speaker. Nova Construction Limited listed in their original documents, Frobuild, a northern business incentive policy registered contractor from Iqaluit, as the supplier of the building materials required for this project. Therefore, Nova is not responsible for the methods of transportation used by Frobuild. We are having discussions at the present time with Frobuild regarding the transportation of the NWT Housing Corporation materials into Iqaluit. Thank you.

Thank you. Final supplementary, Mr. Patterson.

Madam Speaker, again, I think the Minister's response gives me an opportunity to point out that corporations are successfully finding ways around the intent of the tendering specifications of the Housing Corporation. Madam Speaker, it's a small world. We all should know that Frobuild doesn't have the necessary assets on hand to build such a large rent supp job. And, we all should know that Frobuild brought a significant supply of materials up on the Rock Lessard barge this summer, just about enough to supply the Nova job.

I guess I would like to ask the Minister, if he and his officials become aware that the ruse of purchasing the materials from a local supplier was really a way of getting around the requirement to use the Coast Guard sealift, is the Minister prepared to take some punitive action against Nova, because the savings on the materials, using the pirate marine supplier, gave that company a competitive advantage over other northern firms that were willing to play by the rules and use the Coast Guard sealift? Thank you.

Minister of Public Works and Services, Mr. Morin.

Thank you, Madam Speaker. I agree with the Member that we have contractors out there who do

take advantage of this government and the rules this government uses to monitor our contracts. Every time we make a rule, they find ways around them. That's the problem with making the business incentive policy too simple. If it's simple, then it's easy for those contractors who have lawyers, accountants and professional people to find loopholes in the policy.

That is why we are moving to change the policy. Right now, we are going out to all the regions for consultation on that policy and we will tighten it up so we will come down with a hammer on contractors who abuse the system and take advantage of this government. As well as suppliers; suppliers for this specific contract have local preference because they are a local supplier. And that was what we were supposed to have done when we set up the business incentive policy. But, once again, we find as a government that we're getting the short end of the stick. And other contractors, legitimate northern contractors, are losing tenders to fly-by-night outfits because of the way the policy is today. So we are making moves to tighten it up, and I would like that better than to yank contracts from contractors who we know are abusing the policies. But I cannot put this government in jeopardy of paying out cheques to contractors for not having done the work when they can sue and win. Thank you.

Item 6, oral questions. New question, Mr. Patterson.

Minister responsible for Housing, Mr. Morin.

Thank you, Madam Speaker. With this contract with Nova Construction in Iqaluit, they subcontracted the entire project out to a local firm in Iqaluit that's called Webster Belleau Limited Mikim Contracting, who are local contractors. It is my understanding that there were concerns raised that these local contracts, in turn, sublet to a Winnipeg company. So we're getting shafted by our own local contractors in northern businesses, as well as from Nova and from some others, I guess.

Shame.

But we will make moves to fix it and try to address it and bring these things under control. But we're going to have to do them in such a way that we don't leave ourselves open so that we can be sued by either Nova, Webster or Belleau or whatever they call themselves, so that we end up paying them a big cheque for doing nothing.

I had to pay out a $1.9 million lawsuit on behalf of this government to another contractor for doing nothing, and I don't want to get into the same situation again. Thank you.

Supplementary, Mr. Patterson.

Madam Speaker, I appreciate the Minister's response. I would like to ask him this, though. While we're waiting for the BIP to be remodelled and redesigned and go out to regional consultations, tens if not hundreds of millions of dollars of GNWT capital projects are going to be awarded. The budget is soon to be finally approved in this House, I am sure. I would like to ask the Minister, without a revised BIP, what guarantees can he provide Members of this House that no more of the same evasion of the policy, if not cheating on the policy, takes place at the expense of northern businesses and northern opportunities while we're waiting for a new policy to be developed? Thank you.