Thank you, Mr. Chairman. To carry out with the department's mandate in the 1994-95 fiscal year, the government has budgeted just over $34 million, that's an eight per cent increase over last year's budget as a result of forced growth. Of this amount, 86 per cent is targeted directly to programs and program delivery, and 14 per cent is allocated to general management and program support.

As I've indicated on other occasions, in order to effectively meet the needs of the residents of the Northwest Territories and to get more for each dollar spent, the department has reorganized and streamlined. New management techniques have been introduced, funding application procedures have been simplified, divisions performing similar functions have been consolidated, and program implementation and decision-making responsibilities have been decentralized to the regions.

Departmental activities must be linked to the best economic opportunities at the local and regional levels. To this end, the Standing Committee on Finance has recommended that the department provide economic planning leadership and support to communities and regions, as required. We are responding to this recommendation. Staff are meeting with local councils, regional organizations and business groups to review the current initiatives and to seek advice and recommendations on future activities. Formal planning exercises will be undertaken in all regions during the coming fiscal year. In addition, more emphasis is being placed on cost-benefit analyses to help identify the best opportunities and to ensure we are getting the most for our money.

The department is continuing on the course established in the 1990 economic strategy. Emphasis on the development of small business as a means of job creation will continue. Every community has highly-skilled individuals in traditional pursuits: hunting, fishing and the production of arts and crafts. People with these skills tend to live in communities where opportunities for employment are few. The department, as well as the Northwest Territories Development Corporation will continue to focus on these sectors of the economy, in order to generate employment and create income opportunities where they are most needed.

Efforts to increase the level of self-sufficiency of NWT residents will continue for the development of food production capacity and by encouraging the development of the service businesses to meet the needs of residents and to cater to tourists. By using northern firms and products, we will be keeping our money circulating in the northern economy. We will continue to encourage the sustainable commercial harvest of muskox, caribou and fish and to undertake marketing initiatives for Arctic foods.

To support these initiatives, and on the advice of Members of this House, work has been initiated towards a policy on the use of northern foods in government institutions. Food represents a significant portion of the NWT's imports. In addition to developing the Arctic foods sector, agricultural growth will also be encouraged. To guide the development of the industry, an agricultural development policy will be developed.

Tourists are another renewable resource that must be nurtured. Generally speaking, tourists are an ideal resource. They leave behind their money and they take home only memories, pictures and souvenirs. Tourists do little to damage the environment or the cultures. They come to see. We must have attractions and potential visitors must know about them. A new tourist marketing strategy has been finalized and will be implemented in the coming fiscal year.

Marketing activities will be fine tuned to help us compete in this highly competitive market and also recognize the differences between tourist products in Nunavut and in the west. We have different products to sell in each area and to better promote these products, we will develop distinct marketing activities for each part of the Northwest Territories.

With respect to parks, at the request of the Standing Committee on Finance, work on a parks policy has been undertaken to provide direction for future park development. In addition, in response to the committee, the department has started to look at the cost-benefits of parks development. As work on the parks policy is proceeding, maintenance and renovation work on already existing parks will be carried out. A management plan has been developed for facilities already approved and some long-range planning will be undertaken, but no new parks will be approved.

The market for NWT-produced art is soft because of the recession. International marketing efforts are needed to offset this lack of growth in the domestic economy. To promote NWT arts and crafts, the department will publish new promotional booklets and will work closely with the NWT Development Corporation to develop projects to encourage the production of quality craft products, the development of markets, and the establishment of effective distribution networks. Marketing plans for Europe and the United States have been developed. The department has established the wholesalers support program to assist with exporting initiatives and will organize wholesaler meetings to better coordinate plans.

The business development fund was designed to meet the needs of more sophisticated small businesses in the Northwest Territories. To meet the needs of very small businesses, the department has designed a new program to assist the little guy who wishes to start up or expand a micro-business. The new grants to small business policy recognizes the significant contributions that micro-businesses make to community economies. The program is specifically designed for artists, crafts people and commercial renewable resource harvesters.

Business opportunities have to be taken up when they arise or they will be lost. In order to speed up the funding process, applications are now being considered in regional offices as opposed to being sent to Yellowknife for review. Regional superintendents have authority to approve business development fund contributions up to $250,000.

---Applause

Thank you, thank you, thank you. Changes have also been made by the Business Credit Corporation to improve services to clients requesting loans. Loans up to $200,000 can now be approved at the regional level.

Hear, hear.

Thank you very much, Mr. Todd. I was asked by a Member to recognize two members who were in the gallery, but who have now left and did not want to interrupt Mr. Todd in the middle of his presentation. They were John Amagoalik, chief commissioner of the Nunavut Implementation Commission, and Simon Awa, executive director of the Nunavut Implementation Commission. I am sure we would all like to welcome them and appreciate their visit to our Assembly building.

---Applause

Mr. Antoine from the Standing Committee on Finance.

Standing Committee On Finance Comments

Thank you, Mr. Chairman. On behalf of the Standing Committee on Finance, we have a statement here in response to Economic Development and Tourism. The Department of Economic Development and Tourism has long had a reputation of being overly bureaucratic and centralized. This has caused frustration in the northern business community. However, recent movements by the department have started to reverse that trend, which the committee sees as a positive sign. Recent changes to devolve authority should go a long way to making the department and its programs more accessible to northerners.

Devolution

However, with this devolution of authority comes risk. Now that the regional superintendents and regional planners have greater granting and lending authority, they will require training and support to wield that authority in the most effective manner. With devolved decision-making comes a greater need to ensure adequate training of the ED&T staff in the communities and to ensure more consistency and accountability in the application of the department's policies. Committee Members will be watching to see that the mechanisms required to ensure proper accountability are being implemented.

Further, the granting of more responsibility and authority to individual ED&T employees in the communities could create new stresses in their relationship with community members. With a significant change in the role that the employees play in the community, will come a shift in how that individual is perceived in the community. With fewer "levels of appeal", the role that the employee plays in making opportunities available to community members becomes even more critical. Increasing an employee's responsibility and authority could become a major problem in communities where the employee has not earned the respect and trust of community members.

While the department said that decision-making has been devolved, the committee did not see a corresponding shift of support resources to the regions. Regional employees will undoubtedly require supplementary resources in order to carry out additional responsibilities. Committee Members would like to see this issue addressed by the department.

Small Business Ventures

Committee Members feel strongly that the support of small business ventures is a key element in developing a strong economy in the Northwest Territories. Government support of and investment in small businesses or "cottage" industries will produce more jobs per dollar and will greatly enhance a more equitable distribution of economic opportunities throughout the territories.

The department should make every effort to demonstrate their appreciation for and understanding of the role of small business in our economy, especially in job creation. The development and support of small business ventures, particularly aboriginal businesses, should be encouraged everywhere in the territories, including the larger centres. Current policies tend to discriminate against aboriginal individuals who live in larger centres. This unintended discrimination is based on the assumption that larger centres provide more opportunities for business development. However, the department should recognize and address the fact that need and opportunity should be assessed on an individual basis and not on the size or classification of the community.

Members suggested that the department take an active role in assisting communities to develop specific capabilities - for example, various forms of arts and crafts - and to identify appropriate marketing opportunities. Small business ventures that require a consumer market larger than what currently exists in their home community should be provided assistance to identify and assess viable marketing opportunities in other communities or regions.

Tourism Zones

One of the committee's major concerns was about the effectiveness of tourism zone concepts. There is a perception that planning and decision-making in some of the zones is dominated by a few individuals from larger communities and by tourism operators, many of whom reside outside the territories. Smaller communities in a given zone are not heard or taken into account. The committee feels that it could be appropriate for the department to make funding to the various zones' associations contingent upon the guarantee of appropriate representation from all communities within each tourism zone.

Recommendation 7

The committee recommends that the Department of Economic Development and Tourism consider ways to encourage adequate representation of all communities within a tourism zone in its zone association.

Secondment

One specific issue which brought concern to the committee was that of a long-term secondment of a GNWT employee in Rankin Inlet to Piruqsaijit. This secondment was...

(Microphone turned off)

Yes, that's exactly what I said.

---Laughter

This secondment was continued over a number of years at the government's expense. However, the current policy regarding secondment clearly states that the receiving organization usually pays the full costs associated with the secondment. This is from the Human Resource Manual, section 1407, page two.

Recommendation 8

With reference to Piruqsaijit, the committee recommends that the Department of Economic Development and Tourism provide a complete justification for the continuation of this secondment and an assessment of compliance with government policy. This report should be provided to the Standing Committee on Finance prior to the review of the Department of Economic Development and Tourism's budget in committee of the whole.

Committee Members believe that the idea of seconding a trained government employee to a new business for a short period of time has merit. If the government wishes to continue this practice of promoting secondment, then policies and guidelines should be in place to ensure that equal opportunities exist across the territories.

Recommendation 9

The committee recommends that the Department of Economic Development and Tourism consider and develop a policy for secondment of government employees in new business ventures and provide the Standing Committee on Finance with a draft policy by May 31, 1994.

NWT Development Corporation

The Minister responsible for the Development Corporation made it very clear that the top priority for the corporation is job creation. The committee fully supports this position and encourages the Development Corporation to continue to create as many jobs as possible for northerners.

Committee Members feel that the Development Corporation can enhance its performance in job creation by focusing on identifying and supporting small business opportunities. To date, the Development Corporation has supported the development of a few large initiatives in a few regions and communities. While the Development Corporation has $6 million in capital in place for the fiscal year 1994-95, only about $600,000 of this amount has not been committed to ongoing projects. Most of the large projects are concentrated in one region. There is concern about this approach creating economic disparity among regions and communities.

In addition, the committee feels that by adopting a strategy to focus on small business opportunities, the Development Corporation can be more cost-effective. The cost per job created will be reduced and the opportunities for individuals increased.

Recommendation 10

That concludes the Standing Committee on Finance report, Mr. Chairman. Shall I get right into the motions?

Mr. Antoine, that concludes your report. Is the committee ready to go into motions?

Agreed.

---Agreed

Mr. Antoine.