Thank you, Minister Arlooktoo.

Thank you. Mrs. Groenewegen.

Thank you. Mr. Arlooktoo.

Thank you, Mr. Chairman. There are several issues that the Member brought up. First about the consultations on the outstanding issues and the Member did mention some of them, the hydrographic work, the environmental audits and the topographical surveys and community consultations were addressed in a mid-July meeting this past summer, those were issues that were discussed at a meeting of the Keewatin Re-supply Steering Committee, hosted by the Department of Transportation, Public Works and Services where the departments outlined their plans and gave status reports on the hydrographic work, the topographical surveys that were going to be done, and environmental audits that were ongoing and were to be done this past September.

Therefore, although it may be the Member's opinion that there has not been enough work or consultation to-date, is certainly not my opinion. As far as timing goes, I understand the Member did mention timing, the schedule we are following and that I have outlined in my announcement, some time ago, was a schedule that was recommended or identified by the Keewatin Resupply Committee one year ago. I have a copy of it in my hands, a report that we issued on October 2, 1996, which clearly outlined the schedule, that if we were to go on the direct delivery option, the target date was 1999; also clearly talked about but before then hydrographic surveys had to be done in 1997, which they were; that the construction of community resupply lines were to be done in 1998, which we are planning to do.; and that we retender the supply contracts in 1998, which is the intention.

In terms of schedule I believe, we are following what was recommended very closely to the letter. In terms of the dry cargo rates for the Keewatin communities, the best estimates we can get right now are the most accurate, as far as we are concerned, which tell us that the cost of dry cargo to the Keewatin communities would be 20 percent less than they are presently.

The issue as I understand, from the Hamlet of Arviat, especially, and some of the Members in the business community, is that with dry cargo being delivered through freighter from an eastern port, whether it be Montreal or elsewhere, that the frequency of deliveries would be much less. At this point in time there are two to three deliveries to the communities each summer. With the freighter system it would be one, at best, two deliveries per year.

Question, Mrs. Groenewegen.

Thank you, Mrs. Groenewegen. The Honourable Mr. Arlooktoo

Thank you, Mr. Chairman. I think it is important to clarify that what we are proposing to do, is open up the business of resupplying the Keewatin communities for its fuel and cargo so that it becomes a competitive field. Right now, it is not a competitive field. NTCL, which I am proud to say, has done well and is owned in large part by the aboriginal corporation which I happen to be a member of, has done very well in the Keewatin for many years. It is important to point out, that is due partly to the fact that in 1985, after the company was transferred from being a federal Crown corporation to its present owners, the Government of the Northwest Territories Cabinet granted it a carrier of choice designation for 8 years. Which is to say that the NTCL system in the Keewatin would be the one used by the government and therefore, gave it the monopoly situation that it has now. The agreement in 1985, was that the situation would end in 1993.

That was the estimation of how long it would take for it to become a viable company, and that is what it has become, very clearly. NTCL has come up with the best proposal for a very large three-year contract to resupply the eastern arctic, one that I just signed with them this past year, which is worth $90 million. So, it is clearly become very competitive. That is what we are doing. In a sense we are saying NTCL, is now a mature, able company that can go out and become competitive and win contracts. As I said the other day, they are in a very good position to be successful in winning a profitable contract, out of this, once it goes out.

The issue of how that would affect Churchill, as I understand it, the dry cargo and fuel that goes through the rail line through Churchill is five percent of what goes through that port. There is an awful lot of cargo that goes through the line and the port because all of the grain that comes from the Prairie Provinces, or a lot of it, goes through that port and taken out by tanker to other ports to the rest of the world.

Thank you. Final question, Mrs. Groenewegen.

Thank you. Mr. Arlooktoo.

Thank you, Mr. Chairman. If I could just refer again to Mr. O'Brien's report from a year ago, which talks about what would happen if we went to direct resupply which is what we, as the government, are doing.

I note in the summary of the findings, the fourth point. The tug and barge system, while more expensive, offers the highest level of service in terms of the number of deliveries. However, we go to another point, because it is more expensive, and if we went to the direct resupply route which we are doing, it points out it will not be economically feasible to operate both a tug and barge delivery system and a freighter tanker system.

What our concept here or plan envisions is that the tug and barge system, unless the value of the proposal came lower than what I am not sure a company would do, would be probably a thing of the past.

As for northern companies in the field, the Member is right. There are not many. There are interested parties, I understand, that are interested in the transportation field. I, as Minister, encourage that. It is a healthy thing to have competition where it is viable. The north has gone through so many changes recently and advancements that there are right now, many different partnerships and where especially, aboriginal birthright companies using monies from land claims, have been able to partner up with firms that are already set up.

For instance, NTCL for instance. There are others. The Baffin Regional Inuit Association, it used to be called. KYA now, the business arm of that company owns several trawlers that fish offshore for turbot and shrimp. They do very well internationally. So, it is possible to create these partnerships and for these companies to form.

Thank you. I have Mr. Picco. Mr. Picco has indicated he will let Mr. O'Brien go first. Thank you, Mr. Picco. Mr. O'Brien.

Thank you, Mr. Chairman. Thank you, Mr. Picco for being so kind and understanding. Mr. Chairman, before I get started, I would also like to say that for the majority of my dealings with the Minister have been fair and reasonable. We hit a few slippery spots over the last few weeks. These are political issues not personal, and we will address them in that matter. Mr. Chairman, my first question is in relation to this particular issue and to followup on some questions that Mrs. Groenewegen asked. The Minister refers to a report and the date that he indicated was some time in October. I would like to know exactly which report the Minister is referring to because to me, there is one official report that was presented to this House and approved by this Assembly. Which report is the Minister referring to in reference to the comments that he has made?

Thank you, Madam Chair. It is called the Keewatin Resupply Committee Options, October 2, 1996, which details the introduction of the issues, the initial findings and some of the options, which include descriptions of what would happen with the status quo, with the different hubs and direct delivery. That is the one I was referring to.

Madam Chair, this is an issue I tried to address before with the Minister, and it is in relation to what we present here and the facts and the information and the documents should be relevant and tied into what we are doing here. This options document is exactly that. It is not the official report that was compiled by the steering committee, the Keewatin committee that was approved and accepted by this Assembly. What the Minister is referring to is a document that compiled some options that we put together to help the Members of the committee to arrive at a decision. I do not think it is realistic to be referring to that document. The document the Minister should be referring to is the document that was approved and accepted in this House and which was dealt with by Cabinet. There are many options that are included in that document. It is just like a laundry list. The final analysis and the final report stated that the status quo would remain until 1999. That we would work toward a direct resupply, keeping in mind the status quo is staying in place until 1999. That would mean the spirit of that agreement or that decision was that the new government of Nunavut would have the opportunity to devise and decide on what they wanted. That was the first point that was made in the conclusions, that it would stay status quo. There is a point there where it indicates that in 1998, the contract would end with Esso and Associates regarding the tank farm in Churchill. It was also indicated that we would look at possibly extending that to get to 1999.

Madam Chair, the other points that were mentioned, conclusions that were brought forward, was that the hydrographic mapping would continue as it was important and valuable to the communities if the decision was made by the new government to move forward on this recommendation. We stated very clearly in the report, we could move toward direct supply. Hydrographic mapping was to take place, the consultation cost benefit analysis and more importantly, that full consultation take place with the communities. The Minister admitted there has been consultation. It is obvious it is not satisfactory because we would not have the Keewatin Chamber of Commerce along with the mayors of Arviat, Baker Lake and other communities saying well wait now guys, just hang on a second here. We would like to study this more.

Again, the understanding was, and I believe it was made very clear in a statement that was put out by the Chamber of Commerce that it was status quo until 1999. My question to the Minister, Madam Chair, is if the report that was accepted by Cabinet and by this House accepted a report and the recommendation, the status quo remain until 1999, why at this point are we moving forward on a project prematurely? Thank you.

Thank you, Madam Chair. I guess in reality the status quo will remain until 1999. NTCL will deliver fuel and cargo with a tug and barge until the summer of 1999. That is what we are doing. We are, as the committee recommended, working towards direct resupply. I think it is important to get a more global view of why we are doing this. I often listen to the Member talking about the high birth rates, the very large number of young people in his constituency, the housing problems, job problems, et cetera, and that the government, in general, does not spend enough money there. I think most of the constituencies would share that. It is an issue that we need to work on.

When the CN rail line, and I think it was the Government of Manitoba said that they were going to be shutting down Churchill, were giving signals, that was a time when we, the government, decided to look seriously at different options. That was a time when we started pulling in all this information. There were different options considered and at one point we were looking at a hub in Rankin Inlet. After consultation with communities and with the Member and other MLAs, I personally put a stop to that and assisted Mr. Antoine at the time to set up the steering committee so we could look further at what we could do here.

As the information came in it became very clear that with direct resupply the government and the people of the Keewatin could save conservatively an astounding $65 million to $100 million over the next 20 years on the transportation costs alone of fuel. That means more money for the government to spend in other places. There will be less dollars for the hunter to buy gasoline for his snowmobile, less money that a home owner has to pay for fuel, et cetera. The list goes on. As a responsible Minister and as I said the other day, as someone that has great interest in making sure that we do things now to make sure that the future government of Nunavut is as financially secure as possible, this is something that you grab onto as soon as you hear it, $65 million to $100 million savings. I think it would be irresponsible for us not to go ahead with this.

That is why, despite the fact that I have great sympathy for the NTCL company, many of the people that run that company are my friends and associates and people I have known for a long time. So are the people of Arviat. I have been to that community several times. The mayor there is somebody I have known for many years. It is not my wish to do them harm or do things they do not like. At the same time, I have a responsibility, I believe, in making sure the present government does things to achieve the savings in the future for the people of Nunavut.