Thank you. I have been assigned to continue on with the Financial Management Board Secretariat, which is part of the Department of Executive.
Mr. Chairman, with regard to the Financial Management Board Secretariat, with the greatly enhanced duties of the new and enlarged FMBS come greater responsibilities. It is now more important than ever that the committee, and all ordinary Members, be kept informed of and involved in the activities of the secretariat.
Formula Funding Agreement
The committee presented a report to the Legislative Assembly in December 1993, Response to the Options Paper on Deficit Management, that recommended that the Financial Management Board develop an "integrated plan and political strategy" to address all the major financial issues facing the Government of the Northwest Territories over the coming years. Mr. Chairman, there is a reference on page eight, if you want to get the text of that recommendation.
The committee is not yet convinced that the government concurs with this aspect of the recommendation. The chairman of the Financial Management Board agreed to keep the committee informed of the development of the package and the ongoing negotiations with the federal government. However, in the last meeting the committee held with the chairman of the Financial Management Board, it appeared that the chairman was wavering with respect to the "package" concept of negotiating. The committee remains strongly convinced that the package approach is the only effective way to achieve optimal results in the negotiations with the federal government.
Committee Members encourage the chairman of the Financial Management Board to develop a financial and political strategy which would take us through to division and beyond. Specifically, the committee would like to see the GNWT negotiate a five year agreement, with a five year extension provision, which allows for the incremental costs of the two new territories. This would establish a base with incremental costs included as an add-on.
The rationale for developing this comprehensive strategy is multi-faceted.
-The implementation of this strategy would ensure a stable fiscal climate for the implementation of division.
-The Legislative Assembly can serve as a unifying force.
-This strategy provides the opportunity for political unity within the Northwest Territories during the period leading up to division.
-This strategy would provide the basis for a unified focus, among all players -- eastern and western Arctic and the federal government -- for the implementation of division and beyond. It could reduce uncertainty and the potential for damaging misunderstandings.
-There is a strong possibility that there will be a federal election right at the time of division. Negotiations between the Government of Canada and the two new territories, at that time, could be very difficult.
-Governments can plan more effectively with longer term major funding agreements in place.
Human Resource Planning/Affirmative Action
While the affirmative action program has not been as successful as hoped, the emphasis on hiring aboriginals, women, the disabled and indigenous non-aboriginals has made a difference to the NWT civil service. However, as more northerners are hired and fewer southerners are employed by the GNWT, some issues arise that must be addressed.
While committee Members noted that some considerable progress has been made to date in the area of affirmative action, we would like to see even more incentives to hiring in the north. We would like departments to exhaust all other avenues before advertising and recruiting in the south. The committee suggests that the Financial Management Board ask all government departments to support each request to advertise in the south with a detailed description of the efforts undertaken to hire north. Following approval and recruitment from the south, consideration should be given to future initiatives which would alleviate the need to recruit in the south.
Another important consideration in implementing the affirmative action policy, is the training available to northerners. While most northerners have the capability and intelligence to work in the civil service, comparatively few have access to the necessary training for some positions. Specifically, the low percentage of northern aboriginals in technical, professional and managerial positions suggests that training in those areas is not sufficient. It is possible that the hiring practices used to implement affirmative action may be approaching their limit given the current level of training and education among northerners.
As well, career development must be seen as an equal priority. Just training northerners for entry-level jobs isn't enough, they have to have the opportunity to progress with adequate guidance and training. All civil servants, especially those covered by the affirmative action program, should be encouraged to advance, to learn, to progress and eventually to lead.
Along with the reorganization and repositioning of the Financial Management Board Secretariat, the government has established a definitive objective to implement a comprehensive human resource plan. The committee encourages FMBS to ensure that this comprehensive plan encompasses, not only hiring practices, but also education, training and career development.
Government Contracts
Negotiating contracts directly with suppliers is one method of government contracting that has been introduced into the Northwest Territories as a means of developing local businesses. In many communities, negotiated contracts have helped establish successful aboriginal enterprises. However, there is a perception that negotiated contracts may be, somehow, less "fair" than tendered contracts. As well, there have been serious problems with some negotiated contracts. Committee Members feel that all contracts, whether negotiated or tendered, must be better monitored. The committee also believes that full public disclosure of negotiated contracts would help to ensure value for money could be assessed.
Therefore, Mr. Chairman, the committee makes the following recommendation.
Recommendation 4
The committee recommends that the government develop policies and procedures for providing full public disclosure of the details of negotiated contracts, and for monitoring all contracts in order to avoid cost overruns and poor management. Further, the committee recommends that this policy and these procedures be in place before August 1, 1994 and that copies of the policy and procedures be provided to the Standing Committee on Finance.
While negotiated contracts themselves may be controversial, the goals of the concept are not. Members of the committee are in favour of any reasonable proposal which would employ northerners and invest money into our communities' businesses and infrastructure. For example, the public tendering process should be improved. The business incentive policy, BIP, should be amended to include northern employment and buy north provisions in labour-intensive contracts. In short, the government should carefully examine all possible means of improving the government contracting process in order to maximize northern employment and economic activity. Thank you, Mr. Chairman.
Recommendation 5
The committee recommends that the government develop an options paper outlining all possible means of maximizing northern employment and northern spending on work contracted by the government. Further, that the government respond to the Standing Committee on Finance with this paper by August 1, 1994.
Business Incentive Policy (BIP)
Committee Members are concerned that the business incentive policy "needs teeth", that is, that stronger measures are needed to penalize companies who abuse the contract process by violating contract provisions related to the policy. As well, the committee feels that the process used to screen contractors and ensure adherence to the business incentive policy requires tightening up.
Video Production
The committee has an ongoing concern regarding video production within the government. Committee Members are not convinced that the departments, including Education, Culture and Employment and Renewable Resources require in-house video production facilities. Committee Members feel that existing producers could increase capability to fulfil all GNWT needs if video production was privatized.
This has been the subject of repeated recommendations from the committee. If the government does not provide a cost/benefit analysis for producing videos in-house, the committee will propose elimination of all funds budgeted for in-house video production.
Recommendation 6
The committee recommends that the Financial Management Board identify and assess all in-house video production facilities. Based on this assessment, the Standing Committee on Finance should be presented with a briefing that justifies the continuation of in-house video production. This briefing should be accompanied by samples of work recently completed in-house and by private contractors, and presented to the committee before March 1, 1994.
Mr. Chairman, that concludes the report of the Standing Committee on Finance. But I would like to return to recommendation 4 before I finally conclude the report.
