Thank you, Mr. Ningark. Before proceeding with the orders of the day, I would like to inform the House of the passing yesterday of Mrs. Effie Krutko, nee MacDonald, the mother of Mr. David Krutko, the Member for MacKenzie Delta. Mrs. Krutko passed away yesterday after a very long battle with cancer. I understand that she was able to travel to the Delta earlier this year which allowed her to see family and friends before she was returned to the hospital here in Yellowknife. Our prayers are with David and his family today. Also, deepest sympathy to my constituent Evelyn Krutko for the loss of her mother. Orders of the day. Item 2, Ministers' statements. Mr. Todd

Mr. Speaker, it is my pleasure to rise today and formally welcome Members back to the House after the summer recess. I would like to take this opportunity to provide the Members with more details on the fiscal position of the Government of the Northwest Territories and several of the key issues that the Premier addressed in his sessional statement yesterday.

Mr. Speaker, I am pleased to inform the House that we are on course to meet or exceed the deficit reduction targets established in our fiscal recovery plan. Last winter, the government anticipated an annual deficit for 1996-97 of $38 million. With our books for last year now closed, we can report that the deficit dropped to $12 million. While this result is subject to final audit, this reduced 1996-97 deficit means our accumulated deficit rose to only $41 million rather than the $65 million we forecast.

Mr. Speaker, in last February's Budget Address, I announced that this government would balance its budget for the first time in four years. Preliminary figures for the year indicate that we are on course to meet our target with a small surplus of $9 million. This small surplus will be applied against our accumulated deficit.

Mr. Speaker, it is important to note that our fiscal recovery would not have been reached without the co-operation and commitment of all Members of this House. I want to thank them for that. However, I also want to stress that while these forecasts are indeed encouraging, it is important that we all recognize the need to remain vigilant and stay the course with our fiscal recovery plan to ensure that we leave the emerging new governments of Nunavut and the Western Territory and future generations with the fiscal stability that results from a balanced budget.

Mr. Speaker, on behalf of the Government of the Northwest Territories, I would like to state that this Government is fully committed to the principle of pay equity, and is determined to negotiate a resolution to the issue. We are currently meeting with the Union of Northern Workers to identify issues that can be resolved through negotiations. At the same time, Mr. Speaker, we are in the process of implementing a new gender-neutral job evaluation system and I am confident with the support of the UNW that we will finalize the implementation of this system.

Mr. Speaker, as I have stated many times in this House, it is the preference of the Government of the Northwest Territories to find a negotiated resolution to this matter with the Union of Northern Workers. However, it would be remiss of me if I did not stress that it is incumbent on this government to ensure the settlement we make is affordable and does not result in further large-scale program or position reductions; clearly that is not our desire.

Mr. Speaker, while it is important that we remain vigilant in our efforts on the debt reduction side, it is important that we balance this with investments in key program areas in the social and economic development envelopes. Mr. Speaker, Members of this House have noted on many occasions the importance of ensuring that we continue to deliver essential program such as health and social services to our residents. It was for this reason that funding for the social envelope was maintained and, in fact, increased while all other program areas underwent significant budget reductions over the past two years.

As a further step, Mr. Speaker, we have recently identified $4 million to reinvest into our health care system to target strategic reinvestments towards long term health care of our residents. My colleague, the Honourable Kelvin Ng, will be providing more details on this funding later during the session.

Mr. Speaker, during the last session, Members will recall that I announced a reinvestment of $16 million in a Northern Employment Strategy designed to stimulate economic development and job creation in our northern communities. Mr. Speaker, while this strategy was only launched several months ago and departments are still at the implementation stage for a number of the programs, I am pleased to provide this House with a progress report on the results of the strategy to date.

- A total of 46,000 work weeks of employment have been stimulated, this is the equivalent of 1,150 full time jobs;

- Over $9 million has been invested through equity and partnership contributions towards projects;

- Over $6 million in debt financing programs has been provided to the private sector to finance business expansion projects that stimulate economic growth in our communities; and

- As a result of our financial support to employers to hire summer students and youth, over 807 young people have been provided with employment opportunities this summer.

Mr. Speaker, the Northern Employment Strategy represents a significant shift in how this government approaches economic development and job creation. It focuses on developing co-ordinated approaches to economic development in creative partnership with the private sector, communities and regional based organizations.

I would like to congratulate my colleagues, the Honourable Charles Dent, Minister of Education, Culture and Employment, the Honourable Stephen Kakfwi, Minister of Resources, Wildlife and Economic Development and the Honourable Manitok Thompson, Minister of Municipal and Community Affairs as well as all Members of this House for their efforts in making this program a success.

Mr. Speaker, as the Premier has stated on many occasions, the development of our non-renewable resource sector represents our single most important opportunity for sustainable economic growth in the Northwest Territories. With this said, we are on the brink of the most significant period of non-renewable resource development in the history of the Northwest Territories with the development of one and perhaps more diamond mines over the next decade. Mr. Speaker, finding ways to maximize the employment and business opportunities resulting from the development of northern diamonds remains one of the key priorities of this government. The first step in the process was the negotiation of a socio-economic agreement with BHP for both the construction and operational phases of this project. The second step is ensuring that the north maximize its economic potential from the production of northern diamonds. Mr. Speaker, the one aspect of this economic potential that has received the most debate is the extent to which valuation and sorting is done in the Northwest Territories. As the Premier stated yesterday, the position of the Northwest Territories with respect to this issue is clear and unequivocal.

It is the position of the Government of the Northwest Territories:

- that diamonds mined in the Northwest Territories must be valued and sorted in a manner that provides an accurate value for royalty and taxation purposes and maximize the economic potential for the Northwest Territories;

- that the sorting and valuation facility or facilities must be located in an NWT community, off the mine site; and that potential NWT manufacturers be given the opportunity to purchase diamond 'rough' to maximize the economic potential for value added industries in the north.

Mr. Speaker, as Northerners we have a responsibility to ensure that when the federal government develops public policy on North America's first major diamond mine that it reflects the constituency we represent and ensures that all Canadians benefit from this development. Mr. Speaker, while the issue of valuation and sorting of northern diamonds is of great importance to this government, equally important is how taxation and royalty revenues from the production of northern diamonds are shared between the federal and territorial governments. Mr. Speaker, it is the position of this government that the revenues raised from the production of northern diamonds must be equitably shared with the people of the Northwest Territories. Revenues that will help reduce our reliance on the federal government and assist in the development of a strong and vibrant economy.

Mr. Speaker, we are not asking the federal government for more money, we are only asking as other Canadians are, like Mr. Tobin in Newfoundland, for a fair share of the new incremental revenues that this dynamic industry will bring. Mr. Speaker, it is important to emphasize that should we be unable to negotiate an equitable revenue sharing arrangement with the federal government, we will have to pursue alternative options for revenue generation from diamond production. My department is currently working on a paper to review these options, including but not limited to the introduction of new taxation measures.

Mr. Speaker, the Honourable Stephen Kakfwi and I will be meeting with the federal Ministers of Indian Affairs and Northern Development and Finance later this month and we intend to press our position concerning both revenue sharing and the valuation and sorting of northern diamonds at that time. I will keep all Members apprised of the results of these discussion. Thank you, Mr. Speaker.

--Applause

Thank you, Mr. Todd. Ministers' statements, Mr. Kakfwi.

Thank you, Mr. Kakfwi. Ministers' statements. Mr. Antoine.

Mr. Speaker, today I would like to bring the Assembly up-to-date on the commercialization of Canada's air navigation system under NAV Canada and the likely effects we should expect on the cost of air transportation in the north. I know this is an issue of interest for everyone who lives in the north because there is no region in Canada that is more dependent on air transportation than the Northwest Territories.

Just a little more than a year ago NAV Canada, a private corporation, assumed ownership and control of the Canadian air navigation system from Transport Canada. NAV Canada's legislated mandate is to operate the air navigation system in Canada exclusively on a cost recovery basis. The corporation will receive no appropriation or subsidy from the Government of Canada and the corporation does not answer to the federal Minister of Transport or the Parliament of Canada. NAV Canada answers only to its Board of Directors which is appointed to represent the interests of industry, labour and the public.

Up until now, the air navigation system has been paid for mainly through the Air Transportation Tax collected along with the fare on every air passenger ticket sold. Earlier this year, NAV Canada proposed to replace the Air Transportation Tax with a new fee structure based simply on gross aircraft weight and flight distance. The announcement of the new fee structure prompted a great deal of speculation as to its effect on the price of air travel and freight rates.

In truth, it is very difficult to make comparisons and projections between the two methods of collecting revenue because they work on entirely different principles. The Air Transportation Tax was levied strictly on passengers. It did not apply to air cargo. NAV Canada's new fees are based on the carrying capacity of the aircraft. The air carriers can recover the fees from the passengers or the cargo or some combination of the two. How the carriers will choose to distribute the fees remains to be seen.

While the fee structure would be, as intended, mainly revenue neutral on air routes in southern Canada, the northern air carriers and the Department of Transportation were quick to realize that it would increase passenger fares and air cargo rates in northern Canada. The new fee structure applies to an aircraft's carrying capacity regardless of whether that carrying capacity is fully or partially used. Flights on northern routes are not generally as full as flights on southern routes. Aircraft in the north carry freight mainly one way. Return flights are usually empty. The NAV Canada fees will have a greater impact on low traffic routes in the north than they will on high traffic routes in the south.

Since NAV Canada announced its proposed fee structure, we have lobbied hard with the Northern Air Transport Association (NATA), the northern air carriers and Chambers of Commerce for concessions and exemptions that would lessen its impact on the north. I have expressed my concerns directly and in writing to the federal Minister of Transport and the President of NAV Canada.

The Department of Transportation convened a meeting on September 2nd of provincial and territorial deputy ministers of Transportation to consider the impact of the fees. The deputy ministers from Ontario, Nova Scotia, Newfoundland and Manitoba agreed with our concerns with the impacts on northern and remote communities. British Columbia and Saskatchewan were not pleased with the consultation process. The deputy ministers agreed to put the issue at the top of their agenda for the Transportation Association of Canada's meeting in Montreal later this month.

At a meeting in Yellowknife on September 3rd with the department and NATA representatives, NAV Canada officials recognized that the fee structure would increase air transportation costs in the north, but if there were an increase, they thought it would be small.

The Honourable Goo Arlooktoo, the Deputy Premier; Mr. Joe Handley, the deputy minister of Transportation; Mr. Ken Copeland, the president and chief executive officer of NAV Canada and Mr. Arthur Andreassen, the director of Rates and Revenues, met in Ottawa on September 10th. At this meeting, NAV Canada conceded that the effect on northern air routes had been an oversight. They agreed to watch the impacts closely through the first phase of fee implementation when it takes effect on March 1, 1998.

They also agreed to better consultations for the second phase of implementation that begins on November 1, 1998 and extends the fee structure to include smaller aircraft.

As things stand today, we will have to wait and see how receptive and flexible NAV Canada is prepared to be to our representations. NAV Canada suggests that its new fee structure will not produce an increase in our air transportation costs of any more than three percent. Some northern air carriers have projected an increase as high as eight percent.

Mr. Speaker, my time is up. I would like to seek unanimous consent to conclude my statement.

The Member for Nahendeh is seeking unanimous consent to conclude his Minister's statement. Mr. Antoine, you have unanimous consent.

Thank you, Mr. Speaker. Mr. Speaker, the estimates of between three and eight percent apply to total industry revenues. As of yet, we have no indication how the carriers intend to distribute the fees between passenger fares and freight rates.

In any case, our efforts have certainly made NAV Canada aware of the effect of their new fees on the cost of northern air services. We will continue to work with the northern air industry and the Chambers of Commerce to see that the shift to cost recovery in Canada's air navigation system does not impose an unfair burden on the cost of air transportation in the north on which we depend and that is already too high. Mahsi cho, Mr. Speaker.

Thank you. Item 3, Members' statements. Mr. Steen.

The Member for Nunakput is seeking unanimous consent to conclude his Member's statement. You have unanimous consent.

Thank you. Members' statements, Mrs. Groenewegen.

Thank you, Mrs. Groenewegen. Mr. Picco.

Thank you, Mr. Speaker. Mr. Speaker, over the past 22 months, the 13th Assembly has had to deal with deficit reductions, division, transitional plans, housing shortages and a myriad of other issues. Mr. Speaker, the 13th Assembly has managed to get the deficit under control, the Student Job

Strategy this past summer, Project 2000, the Access to Information legislation and other initiatives have been successful to varying degrees.

However, we have not addressed the dilemma of population increase and forced growth. The Northwest Territories has the highest teenage birth rate per capita in the country. Inflationary factors of forced growth have caused increased spending within the social envelope to the point of sustainability. Mr. Speaker, we have to address this now. Other jurisdictions have implemented family planning programs and courses at the high school level. We need to begin these programs from the current drib-drab approach more pro-actively.

Mr. Speaker, family planning, high birth rates and teenage pregnancy are very delicate subjects to approach at the best of times. But something has to be done and it has to start now. Education of the implementation and ramifications of the continued teenage pregnancy and the impact socially, as well as monetarily, have to be explained.

Mr. Speaker, as an elected official over the past 22 months, I have tried to bring areas of constituency and territorial matters to this House. I have tried to provide constructive criticism as well as solutions to our problems. The legacy of the 13th Assembly will be of what we have accomplished, and not what we have pontificated on.

Later today I will ask the Minister of Health and Social Services about the issues surrounding family planning and strategies to address it.

Mr. Speaker, as I have said in this House before, a goal without a slogan is just a strategy. Thank you, Mr. Speaker.

Thank you, Mr. Picco. Members' statements. Mr. Enuaraq.

Thank you, Mr. Speaker. In most communities there is the need for daycare facilities for working parents and parents attending school. These people are trying to improve their lives by attending school or finding employment. Daycare is a necessary service for steps towards independence from government.

Under early childhood programs, there is funding available to the communities. To get this funding the community has to complete procedures laid down by the Department of Education. For two years a group within the community of Broughton Island has been trying to start a daycare but has been unsuccessful. The community needs assistance to achieve this goal. They are bewildered as to who to approach and how to approach them.

Mr. Speaker, when our government offers grants and programs to the people of the north, it is important that they also offer information and help so that all individuals can have equal access. Often, due to the lack of staff or information, small communities miss out on programs and money. Unfortunately, these are often the communities that need help the most. Thank you.

Thank you, Mr. Enuaraq. Members' statements. Mr. Roland.

Thank you. Members' statements. Mr. Miltenberger.

Thank you. Members' statements. Mr Arlooktoo.