Thank you, Mr. Chairman. It is my pleasure to present the comments of the Standing Committee on Infrastructure, regarding the Department of Public Works and Services.
The standing committee noted, with approval, the significant reductions in proposed capital spending by the Department of Public Works and Services. Committee Members recommended only small further reductions in the amounts proposed for office accommodation capital improvements. However, the committee felt that the department was able to handle further reductions in operations and maintenance spending. As a result, the department was able to trim about $4 million further in proposed expenditures over the review process.
This department is moving away from its traditional role as an actual provider of services to government and municipalities, towards being a coordinator for providing these services. As a result of this trend and the spending reductions forced upon all government departments, many of the reductions in this department relate to the project management function. Committee Members recognize that the department will need fewer staff in this area. However, reductions should take place in an efficient manner. The department should discuss project management needs with other departments, to ensure that the best use is made of the government's existing staff and other resources.
In February, the Premier announced a number of privatization initiatives, mostly within this department: petroleum products; computer systems and services; property management; and, community resupply operations. The Standing Committee on Infrastructure has discussed these proposals with the Minister and his staff, and is looking forward to seeing the detailed plans for privatization as soon as they are complete. Therefore, the standing committee recommends that no privatization initiatives be implemented until the detailed privatization plans have been reviewed by the appropriate standing committee. In this case, privatization plans for petroleum products, computer systems and services, property management and community resupply operations should be forwarded to the Standing Committee on Infrastructure before implementation.
While committee Members agree with the Premier that the government should get out of government functions that can be handled better by the private sector, the standing committee wants to ensure that any privatization initiatives are done in the right way, for the right reasons. Privatization should be a way to provide better service for lower costs, and if a given privatization initiative does not meet that test, it should not be implemented.
Related to privatization was a concern noted by committee Members regarding the petroleum products stabilization fund. This fund is in a deficit position of approximately $2 million, and the deficit is apparently growth. The standing committee recommends that privatization of the petroleum products division not take place without a plan to recover said deficit.
The standing committee also welcomed plans by the department to invoke a user-pay strategy for services provided by the department. Making client departments and other organizations pay for services rendered is more likely to encourage efficient use of these services. This policy is already being implemented for telecommunications costs, and the standing committee recommends that the user-pay concept be implemented in other areas as soon as possible.
This is especially important when it comes to services provided to communities by this department. If the communities are receiving services without having to pay for them, they will not have any incentive to reduce costs and operate more efficiently. The user-pay concept must be implemented with communities as well as with client departments, in order to strengthen the government's message of community empowerment.
analysis of the costs of this policy to be provided by the department as soon as the analysis is complete.
While the standing committee recognizes that many benefits have accrued to the NWT business community as a result of the BIP, we also recognize that we can't afford to do everything we want to in the current fiscal climate. Therefore, the standing committee recommends that the government include reducing total costs to government as a prime objective in its plans to change or replace the business incentive policy.
That concludes the comments of the Standing Committee on Infrastructure. Thank you, Mr. Chairman.