Thank you, Mr. Chairman. I would like to indicate that I am in support of home ownership and small businesses across the Northwest Territories. I think that has been stated clearly by Members of the Cabinet. However, I would like to say that part of the message we wanted to send with this increase is that there are costs to this government which could be shared by the residents of the Northwest Territories. This is not a very easy decision to make, but I hope it will make people realize how much of a subsidy is being received by the municipalities.

This is a small rate reduction for most residential users. The example the Member used with Cape Dorset appears to be the name of a person, but in the records of the department, it is one of the commercial users there. Therefore, it is listed with the commercial users of Cape Dorset. I believe that answers the question about Cape Dorset.

With regard to the other question, I will ask Mr. Menard to respond.

We did look at dealing with Fort Simpson without disrupting the other communities. We looked at dealing with Fort Simpson that way and we looked at dealing with Hay River and Inuvik the same way, but we only had so much money so we tried to rationalize a whole water and sewage subsidy program in one, and then had to do some changes. We had a hard time wrestling with fairness and equity because what was perhaps fair in Fort Smith to businesses was not fair maybe in Resolute Bay or other places.

There is only so much that we felt that this government could subsidize and we wanted to equalize the subsidy to allow businesses the opportunity to recover some of their costs through rates. I don't think the increases are that bad that they will deter tourism or anything like that. Again, we went with the wisdom of the Cabinet. Instead of going with 50 per cent right away, we will only go ten per cent at a time to see the impacts. We want to minimize the impacts and hope they will be minimal before we move to the next ten per cent cut. I think, eventually, we'll be able to equalize.

We'll also encourage conservation because one of the worst abusers of water are hotels. When I travelled to Cape Dorset back in the early years, every place I went in the bathrooms there were little signs. I was scared to turn the water on because of the signs that said don't waste water, conserve. As soon as we came in with the policy, the showerheads were changed, they had bigger taps and people used more water, to the point of just about wasting it. We know, as a government that supports it, that it might cost the government more money. But I think by rationalizing the policy, we're shifting some responsibility to users, to municipalities and try to live within our means.

Thank you, Mr. Chairman. Mr. Chairman, I understand now that the sample list we got was commercial users. I wonder if we could ask the department whether they have prepared a similar analysis for private home owners in various communities to project the typical impact of this proposed change? Thank you.

Mr. Chairman, we don't have one that would list the residents of every community. We do have a paper that did look at the impact on residential and non-profit users in a number of communities across the Northwest Territories, but not as extensive as the commercial users impact analysis that was handed out. We could make this available to Members as well.

Mr. Chairman, I don't know if I was fair to the Minister in my Member's statement today. I don't recall a whimper of notice about this when we discussed the main estimates of Municipal and Community Affairs. Was the new proposed water and sewer services subsidy policy built into the main estimates of the department or will the proposed revenues be in addition to the revenues forecast in the main estimates approved by this Assembly earlier this session? Thank you.

Thank you, Mr. Chairman. I don't know if it is so much revenue as it is savings. However, the impact of this particular amendment was not in Cabinet and had not been considered in this budget. Thank you.

Thank you, Mr. Chairman. The water and sewage subsidy program is something that I have been pursuing for a number of years, since I was elected over two years ago. I have been in contact with the Ministers and the deputy minister quite often and they have been trying to keep me abreast of the developments in this policy. The reason for my pursuing it was that the village of Fort Simpson is a tax-based municipality, however, it is not a full-fledged tax-based municipality. It is labelled as a tax-based municipality. I think the majority of the people in the community don't pay taxes. There is a minority that pay taxes. As a result of that, they call it a tax-based municipality. It is an odd type of arrangement.

Every year the village has to go to the government to get subsidized because of the accumulated deficit that arises through the year towards the water and sewer subsidy. When I heard the policy last week, I was quite pleased because it helps the community of Fort Simpson. It is the type of thing we have been pursuing. I just want to let people here know that in the community of Fort Simpson, the people who live in the area I live in, pay $15 a trip, no matter how much water we get. Some people get water twice a week, that is $30 per week or $120 per month. Some people get water three times a week, so it may be as high as $180 per month. This has been going on within the last couple of months. The water and sewer subsidy is not in place. As a result of that, the people who deliver the water are a private business. He has to pay for his costs. So because of the lack of subsidy, we have to pay that much. We are already paying the level that was stated here earlier today by some Members of how the costs will escalate if this subsidy program is put in place.

I am not for deferring this policy, but to accommodate some of the Members who have a concern, we could perhaps see if the Minister could do more consultation with the communities and get back to Members of the House as soon as he can to tell us the results of the consultations before this policy is put into effect. Perhaps that may be one way of dealing with this problem. It seems to be a consultation problem. Personally, I have been pursuing this in the House, so I am quite familiar with what is going on. I didn't know the details of the policy until the Minister announced it. It is going to have an impact on the communities, mainly in Fort Simpson and Fort Liard. In Fort Simpson, it will sure help.

At the present time, the Fort Simpson accumulated deficit is $560,000 towards the water and sewer program because there is no subsidy in place. They have been accumulating it up to that amount. All the other programs are right on. There are no problems there. But in the area of water and sewer, it is taking away the finances from other programs. So they are in a difficult financial situation because of this program. If this subsidy kicks in, I am told the village is going to recover this $560,000 over the next three years. So the community is going to pay for the accumulated deficit they are in. So this policy is definitely going to help the community.

The way this policy is perceived to be is, to accommodate Fort Simpson and Hay River, we are jacking up everyone's costs. That is what I am picking up from some of the Members in this House. We are dealing with two different items here. One of them is to equalize the pay to other Members by implementing the subsidy program in the community of Fort Simpson and Hay River. That is one area. Along with that, there are some changes in the hamlets to the commercial users and other municipalities. The commercial users are going to change. That is going to drive up the cost of some businesses, especially the businesses that use a great deal of water, like the hotels and so forth. That might impact on the room rates and so forth. It has a ripple effect in communities.

I just want to make it clear that we are dealing with two different issues here. One of them is to equalize the water subsidy program to the communities. The other one is that we are trying to get people to pay more. I just want to use the people I know in my neighbourhood in Fort Simpson as an example. Since we started paying $15 for a trip, that is $30 a week and $120 a month, people start conserving their water. You don't take showers as often as you normally did and you use the water very conservatively. Sometimes you run out of water.

Water is a commodity that is needed in our lives and it has all kinds of different uses, but people have been used to the cost of it. The Minister, in his statement, stated that there is a historical connotation to it. In 1987, this subsidy was introduced with 0.2 of a cent per litre. In 1990, it increased to 0.22 of a cent per litre. Now, it is up to 0.33 of a cent per litre. It is increasing. How long are we going to subsidize these communities? That is another question. We are talking about user-pay. The problem that I am hearing from Members in this House is that there was a lack of consultation. The other problem that I am hearing, what the Members are saying is that, to accommodate Fort Simpson, we are jacking up everybody else's costs. Is my perception correct? Is that the case? Thank you.

Thank you. Mr. Minister.

Thank you, Mr. Chairman. I apologize to the Member if that is the message that the Member is receiving, because that is certainly not the intention of the statements that I have been making. If I could clarify the reference by the Member in the statement, I think that there has been consultation and the need for the equity of this particular policy has been a request made by the municipality of Fort Simpson over a number of years. I think that is what we have been trying to indicate. I don't think that the increase that this amendment is causing is as a result of the village of Fort Simpson. Rather, the increase is based on the base rate which is used. The base rate is based on the rates used in the city of Yellowknife, which, at the present time, are at 0.33 of a cent per litre. That is what the amendment is doing. It is decreasing the subsidy so that it is in line with the base rate that is used here in the city of Yellowknife. Thank you, Mr. Chairman.

Thank you. General comments. Mr. Antoine.

Thank you. I just wanted to further state that I was aware of these changes to this policy as far back as the last government, when we first talked about it. I am sure that I wasn't even involved with the government, but I knew about it. I knew that it was going to benefit the community because we pay a much higher rate right now for water. Even though we are designated as a tax-based municipality, there are some communities in the north which are far larger than Fort Simpson and are still hamlets and they get the full subsidy, such as Pond Inlet, Cape Dorset, Rankin Inlet and Arviat. These are some of the communities that I would like to name specifically that are larger than Fort Simpson with more people. In fact, some of them have more businesses and they are still fully subsidized.

When we talk about one of the principles of the Standing Committee on Finance as fairness and equity, I think what this policy does is try to equalize the whole water and sewage program. That has been going on for a number of years. Even when the last government introduced it, I was aware of it even though I wasn't involved in the government. In this time around, what the department has attempted to do is try to equalize it and try to be fair at the same time. I would like to say that is a good policy. However, there is some concern with some of the Members that there seems to be a lack of consultation. That seems to be the main problem that we are having here. If we could perhaps deal with that consultation problem, then it probably will be supported in this House. Thank you.

Thank you. Mr. Koe.

I think most Members have had an opportunity to make their comments. I still have concerns about the implication to small businesses across the north, particularly the businesses in my community. I would like to propose a motion, Mr. Chairman.

Whereas, there was limited consultation with communities regarding a potential impact of changes to the water and sewage services subsidy policy;

And whereas, there may be significant implications for small businesses and private home owners as a result of the changes;

Now therefore I move that the Minister of Municipal and Community Affairs undertake and complete consultations with communities regarding the impact of changes to the water and sewage services subsidy policy;

And further, that the Minister prepare a detailed report on the consultation undertaken, including communities, organizations and individuals consulted and comments as a result of these consultations;

And further, that the matter of the water and sewage services subsidy policy be referred to the Standing Committee on Finance for review of the policy's implications;

And further, that the Minister provide the report to the Standing Committee on Finance by May 5, 1994;

And further, that full implementation of the water and sewage subsidy policy not be proceeded with until the Standing Committee on Finance has provided its comments to the Minister of Municipal and Community Affairs.

Thank you, Mr. Koe. The motion is in order. To the motion. Mr. Koe.

I think the implications of the wording of the motion are fairly clear. Members have indicated a concern about consultation. Other Members have indicated concern about the implications on small businesses and on private home owners. Other Members have indicated their concern about the impacts on their specific communities. The Minister and his staff have indicated that each community has some anomalies and the delivery system and the costs are different. What we would like, and what Mr. Antoine indicated, is that the consultation has to be documented and we have to be clear that where

there are impacts, proper consultation is done. We want to refer the process to the Standing Committee on Finance. We want a report to be made to the standing committee by May 5, which would still give the department ample time to implement the policy by June 1, if that happens.

My understanding is that the Standing Committee on Finance will be meeting some time in May so they can review the report from the department then. That is why the motion was made. Mahsi.

Thank you. To the principle of the motion. Mr. Minister and then Mr. Zoe.