Mr. Speaker, several days ago, the Department of Public Works had a briefing and consultation meeting with Members of the Legislative Assembly, and we received some good comments and suggestions at that meeting. I would think that until the day the new policy is approved, we would continue to take suggestions and comments from Members.

Thank you. Item 6, oral questions. Mr. Henry.

Thank you, Mr. Speaker. My question is to the honourable Minister of Finance. Yesterday in the House, I asked the Minister what method he proposed to attain any of the wage and benefits savings from excluded employees back to general revenue. An example I was given was the WCB. The honourable Minister responded that the savings are not coming back to the GNWT with respect to the Workers' Compensation Board. Can the Minister explain how this reduction to the example of WCB employees will contribute to a saving to the government?

The Minister of Finance, Mr. Todd.

Any reductions in the overhead of the WCB would, hopefully, be passed back on the assessments to the employers. This would ultimately make employers more profitable, which would ultimately make their taxes greater, so ultimately would, even though it's further down the line, have an impact on this government. That's what I meant yesterday and perhaps I didn't explain it as properly as I should have. Thank you.

Item 6, oral questions. Supplementary, Mr. Henry.

Thank you, Mr. Speaker. As the Minister was not aware until March 15th that these funds were not coming back to the government, my question is how much does the lack of these funds not coming back to GNWT coffers alter his budget projections.

Mr. Todd.

Thank you, Mr. Speaker. I think it's important to point out that the WCB is funded by employers' contributions and there is no direct fiscal relationship in terms of the government base funding to the WCB. The point I was trying to make yesterday is that there is an

impact if there's a reduction in the cost to the WCB because it impacts upon employers which Will ultimately impact on their ability to create employment, pay taxes and deliver

services to the Territories. Thank you.

Item 6, oral questions. Mr. Picco.

Thank you, Mr. Speaker. Mr. Speaker, my question concerns the announced reductions to pay and benefits. Mr. Speaker, can the Minister of Finance explain why a six-year employee with a family of four in Iqaluit will be reduced by 19.53 per cent and the same family in Fort Smith will be cut by 6.84 per cent? Thank you, Mr. Speaker.

The Minister of Finance, Mr. Todd.

Thank you, Mr. Speaker. Perhaps it's important that we try to deal with and try to respond to this question. The principle of the strategy, which we've been trying to accomplish here and has been discussed at length with this Legislative Assembly through the standing committees, is this: The government can no longer afford to maintain the same benefits package that was originally designed to attract public servants from southern Canada. It's time to recognize the fact that increasing numbers of northerners do have the education and do have the job opportunities within the GNWT. The change to the northern allowance is intended to de-emphasize the recreational travel and provide a fair compensation package to the people who we've all grown up with to enable our employees to meet the basic needs in the community, whether it's mortgage payments, feeding the family, et cetera.

In the process of restructuring the northern allowance package based on the principle that we can no longer afford the current package and the fact that the old package was designed primarily for a southern employee component that took place 20 or 30 years ago, we redesigned it. It's an oversimplification to use the vacation travel component and to exaggerate the percentage changes when we're talking about a cost of living allowance and not a recreational bonus. Thank you.

Thank you. Item 6, oral questions. Supplementary, Mr. Picco.

Thank you, Mr. Speaker. I enjoyed that history lesson on the northern allowance package. However, the point is that these cuts are affecting the long-term northern residents who have been here 10, 15 or 20 years working for this government. That's the point. Mr. Speaker, the majority of our workers who are working at the entry level are aboriginal, at the $30,000 to $40,000 rate. My point is that these people are going to be affected. I'm prepared today to table in this House a document showing that. I'm

still waiting for a document from the Minister of Finance that was asked for last week.

Mr. Speaker, my supplementary question to the Minister is will he commit to reviewing the proposed reductions based on these inequities. That's all I'm asking for.

Mr. Todd.

I obviously have a fundamental difference with my honourable colleague. We've got to deal with the principle of the strategy. I'm going to say it again: The principle of the strategy is for us to provide the wages and benefits to a northern employee base that addresses the basic cost of living in the country. That's what we've tried to accomplish. If you look at it from the vacation travel perspective, yes, there is disparity. If you take that out of the component and look at it from a cost of living component, which is what we're trying to accomplish here ... Let's not forget that there are others out there who are less fortunate -- the unemployed, the people who can't find jobs -- we've also got a responsibility to them in the overall deficit elimination strategy. When are some of the Members in this House going to recognize that? Everybody has to take the cut. Thank you, Mr. Speaker.

Item 6, oral questions. Supplementary, Mr. Picco.

Thank you, Mr. Speaker. I realize that everyone has to take a cut. And I also realize people are unemployed and are on welfare; I know, they are in my family. I also realize that a lot of the northern workers who we're talking about support extended families. For example, I support an extended family so, by cutting my salary, you're hurting my extended family who isn't working. That's the point. The VTA component is part of that package. It has been for X number of years. So when you look at the total package and you cut that, you're affecting these workers. That's all I'm saying. When I look at the cuts, I know, that they're not equal. I don't want to sound uncompassionate to the Minister of Finance. I know the Minister is grappling with this. I know the Minister of Finance is compassionate. However, I also see that when I look at reductions, for example, a family of four in Aklavik being cut 19.82 per cent and the same family being cut 8.5 per cent in Hay River, that's not equity. That's what I'm saying here. I'm asking, will the Minister address this.

Mr. Todd.

In my opinion, it is equitable. The honourable colleague, with all due respect, is not paying attention to the principle of the strategy. The principle of the strategy is to ensure that we provide a wage and benefits

package for northern employees that meets their needs. It is not designed and will not be designed in this government if we are to meet the targets that this Assembly and the standing committees worked with us on to address the VTA recreational bonus that was originally designed for southern employees. It's an unfortunate situation that over the years people have viewed that as part of their overall income. It was and is vacation travel assistance for people to go south, nothing more, nothing less. The principle of what we're trying to accomplish here is a benefits package that addresses northerners and their cost of living. I can't address it any other way. I don't know how else to explain it to the honourable Member.

Item 6, oral questions. Final supplementary, Mr. Picco.

Thank you, Mr. Speaker. It's not rocket science. I understand the principle of the bill. However, what I'm saying is I've been in the North for 15 years, so I guess I'm not a long-term person. It would affect me. I can only use myself as an example. Mr. Speaker, I know that there is a deficit problem with the government. We've spoken about it. I've talked about it. I'm doing what I can. That's the reason I brought up the bigger hit in MACA for the capital cuts the other day. Mr. Speaker, has the Minister looked at a cut across the board of perhaps five or 10 per cent of all employees? So if you cut Ed Picco 10 per cent in Iqaluit on $60,000, that's a reduction of $6,000. It would be the same amount in Hay River. To me, that's more equitable. That's my supplementary question to the Minister. Has he looked at across-the-board cuts of five or 10 per cent?

Mr. Todd.