Thank you, Madam Speaker. Following up on my Member's statement today, I would like to ask the Minister of Finance, the Honourable John Pollard, if the Government of the Northwest Territories has determined yet what position it will take in the NWT in response to the action taken by the Government of Canada this past week to lower cigarette taxes by reducing the federal tax by $5 a carton? Has the GNWT determined its position? Thank you.

Thank you. The Minister of Finance, Mr. Pollard.

Thank you, Madam Speaker. Madam Speaker, no, we have not decided what to do, other than I will not propose decreasing our taxes. Beyond that, I should inform the House that I met yesterday with the RCMP. I talked with the RCMP in Iqaluit yesterday and I will be talking either today, this weekend or Monday morning in a conference call with all the health board chairs. I will be talking to the chief on the Dene reserve in Hay River on Monday. Any decision we make -- and I say we, Madam Speaker, because if I wanted to change the price of tobacco in the NWT, it has to come before the House, it is in legislation -- will be a decision of this House.

Before I propose what to do to Cabinet and to this House, we have to sit back and watch what is going to happen across Canada. The Department of Finance is discussing this issue with the western provinces. We already know what Quebec is going to do. The Department of Health is discussing the packaging issue with the Departments of Health across Canada. We haven't made a decision yet. When we make a decision on what to propose, it will be a steady decision and hopefully, the right decision. Thank you, Madam Speaker.

Thank you. Supplementary, Mr. Patterson.

Thank you, Madam Speaker. Madam Speaker, my supplementary question to the Minister of Finance is that since he has stated he will not be, at least immediately, proposing a decrease in taxes in the Northwest Territories, in taking this position, what account has the Minister of Finance taken of the well-established link between cigarette prices and the rates of smoking? Is that a factor in the position for not decreasing taxes? Thank you.

Thank you. Minister of Finance, Mr. Pollard.

Thank you, Madam Speaker. Madam Speaker, that is the prime reason, although I would be less than honest if I didn't say we're worried about erosion of tax dollars as well. But, primarily, it's related to health. As most of you know, I was at a Health Ministers' conference on Monday, Tuesday and Wednesday. Everybody knows that when you increase the price of tobacco, consumption goes down. Ministers of Health were saying to the federal Minister of Health that by this action of the federal government, you are going to incur large health costs down the road for those people who start up smoking because it's cheaper.

Thank you. Supplementary, Mr. Patterson.

Thank you, Madam Speaker. Madam Speaker, looking at the situation in Ontario and Quebec, where people are smuggling cigarettes already into Ontario from Quebec and comparing that situation to the territories, it seems that with direct air links to Montreal, the Baffin region -- and particularly Iqaluit -- may be vulnerable to widespread smuggling. This is predicted by at least one of my constituents who is in the retail business.

I would like to ask the Minister of Finance -- and he's had some conversations with the RCMP in Iqaluit, he said -- is the intention that the Department of Finance and the government, through the RCMP, will be closely monitoring and taking steps to control the incidence of cigarette smuggling in the Baffin and particularly in Iqaluit? Is that the idea behind these consultations with the police? Thank you.

Thank you. Minister of Finance, Mr. Pollard.

Thank you, Madam Speaker. This is indeed a complex issue, Madam Speaker. It is not just a question of whether we lower our taxes, maintain our taxes or move into the federal tax room. We have to look at the packaging and we have to look at the age. The federal government shows 18, which I think is wrong. It should have been 19. It is much easier to identify a 19 year old because that is the age they can get into bars, et cetera. So, I think they have made an error and they may revisit that area.

Right now, any one of us could bring in 50 cartons of cigarettes from a southern province and we wouldn't have broken the law, as long as we say we are going to write to John and send him the tax dollars he should have received on it. That puts the RCMP in a difficult position because they could never say to someone you have too many packages of cigarettes, and we suspect you are going to sell them as contraband. A person would say I am going to remit the taxes to the Department of Finance.

Then it goes back to where these people who order shipments from -- I know about the barge situation -- those people from Iqaluit. We are checking to see if those companies, that were mentioned in Mr. Harper's letter, do have tobacco licences issued by this government. We are looking at packaging and possession. We are looking at what other jurisdictions are doing. The whole thing is being taken into consideration before we make a move. I don't want to make a knee-jerk reaction that doesn't encompass the whole situation.

I recognize the suppliers of the retail outlets of the Northwest Territories are going to be under some business pressure. I want to do what I can to protect their business as well. I mentioned the Dene reserve in Hay River, Madam Speaker, simply because if we keep our taxes up or if we move into the federal tax room, there is going to be a lot of pressure put upon the people on the reserve. I want to discuss that with the

chief down there before we make a decision. Thank you, Madam Speaker.

Thank you. Final supplementary, Mr. Patterson.

Thank you, Madam Speaker. My final supplementary has to do with the prices of cigarettes today in the Northwest Territories. I take it from the Minister's response to my opening question that it is presently GNWT policy not to decrease taxes and, therefore, not to lower the price of cigarettes because it will be an inducement to increase levels of smoking.

However, Madam Speaker, I am informed by retailers in my riding that they have been advised by wholesalers in Quebec that because wholesalers in Quebec are no longer paying federal taxes, the retailers in the Northwest Territories can and should pass on the savings and lower the price of cigarettes sold in the Northwest Territories by the amount of that lowered federal tax. I would like to ask the Minister of Finance if he is aware that, despite the present policy of the Government of the Northwest Territories not to change taxes and, therefore, not to lower prices, prices have already been lowered by the action of the federal government and by instructions given by wholesalers to retailers in the Northwest Territories? Those retailers were urged to call their wholesalers by the officials in the Minister's Department of Finance, who gave them that advice. Is the Minister aware of that situation?

Thank you. Minister of Finance, Mr. Pollard.

Thank you, Madam Speaker. Yes, I am, Madam Speaker. What is happening is we have no control over the federal tax. The Prime Minister stated that he would cover people's inventories. So the federal government advised wholesalers that on a particular day, I think it was the night of the 9th, they would do inventory and be able to recoup those federal taxes from their wholesalers. They were able to drop the price as soon as they wanted on the federal side of the tax.

As far as our side of the taxation is concerned, I could not change this tax until the 1st of April so we are not losing any money at the present time because that is the way the legislation is set up. Each quarter, I review the tax and we look at the retail price of cigarettes in the Northwest Territories, less the federal tax. So, yes, I am aware that the federal tax has already dropped the price of cigarettes across the Northwest Territories. Yes, I am aware that it was on the inventory that was on storekeepers' shelves on that particular day. I have no jurisdiction over that issue, but we have not dropped our territorial tax, Madam Speaker. Thank you.

Thank you. The honourable Member for Deh Cho, Mr. Gargan.

Thank you, Madam Speaker. I would like to direct my question to the Minister of Social Services. In her last response to me with regard to the benefits for treatment workers, she indicated that Inuvik is considered off the highway system for benefits purposes only. I am sure the Minister is aware of what the differences are in benefits between treatment centres that are on the highway systems and off the highway systems. What is the difference between the benefits for people who work on the highway system and off the highway system?

Thank you. Minister of Social Services.

Thank you, Madam Speaker. The benefits I was talking about, off the highway system, are settlement allowances. Thank you.

Thank you. The honourable Member for Kitikmeot, Mr. Ng.

Thank you. Minister of Economic Development, Mr. Todd.

Could he ask the question again? Could I get clarification? Was it commercial quotas or was it utilization of renewable resources?

Mr. Ng.