Thank you, Mr. Steen. Mr. Kakfwi?
Debates of Feb. 11th, 1997
Topics
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 552
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 552

Stephen Kakfwi Sahtu
Madam Chair, where the majority of funds used in a contract is GNWT money, then whatever agency is contracting has the responsibility of monitoring that contract to ensure that it complies with the business incentive policy.
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 552
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 552

Vince Steen Nunakput
Madam Chair, just my final question, which is more an observation than a question... I know that the most recent addition to the grandfather clause is November 28th, 1996. That was probably happening while the committee was reviewing the BIP and the list of grandfathers, so obviously this list continues to grow, Mr. Minister.
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 552
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 552

Stephen Kakfwi Sahtu
I do not have the specifics of that, Madam Chair. I cannot provide that to the Member.
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 552
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 552
Edward Picco Iqaluit
Thank you. I can see that we are running out of time, Madam Chair. I just want to make a couple of questions to the Minister on tightening up what is deemed northern, what is eligible under the BIP? I do have some strong concerns when we allow multinationals and extraterritorial companies to be included under the BIPs. My question would be to the Minister. I know this has come up. Are we looking at it as a government to somehow limit these multinationals and extraterritorial companies as inclusive under the Business Incentive Program?
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 552
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 552

Stephen Kakfwi Sahtu
Madam Chair. Yes, as recommended by the working group, this grandfather clause will be subject to further review by myself and officials and will be a consideration when we go to Cabinet. Thank you.
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 552
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 552
Edward Picco Iqaluit
Thank you, Madam Chair. My question would be then to the Minister. When we say we are going to look at it under review, what is the basis that you are going to look at these companies? Are you going to say, for example, that they have revenue over $5 million, and they would not be on there? Are you going to look at where the head office is located? Are you going to find out whether they are paying income or corporate tax? I mean when we say we are going to look at it, to tighten it up, what are the parameters that you are going to look at to ensure that these multinationals and these extra-territorial companies have been deemed not grandfathered under the BIP? Thank you, Madam Chair.
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
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The Chair Jane Groenewegen
Thank you, Mr. Picco. Every time you say extra-territorial I think you are going to say extraterrestrial. I have never heard companies from outside the territories referred to as "extra-territorial". Mr. Kakfwi?
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 552

Stephen Kakfwi Sahtu
Thank you, Madam Chair. Of course we would consider it in the context, whether there is any benefit to having such a thing as a grandfather clause and
to having specific companies and businesses listed within that grandfather clause. Is there any benefit to the northern business community? Is there any benefit to local and business people whether there is any benefits to local and northern employment? If it shows listing them or having such a list is to the detriment, again of those same considerations, then that is what generally what we will use to make a decision.
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 553
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 553
Edward Picco Iqaluit
The problem I see with that is, let us say we use a bank. The bank hires its staff from the local community. The local staff live in the local community, they buy in the local community. So looking at those kind of broad strokes, strokes the Minister is talking about, a bank, for example that is now grandfathered, could still be considered in place under the grandfather clause. So I am saying, we need some stronger, tighter parameters to look at. So, for example, could we look at that if it is an extra-territorial, (we learned something new, Madam Chair), so an extra-territorial company or multinational, you could look at, for example, if the head office is located in a certain location and the majority of the shareholders are in the south, for example. Maybe any company that is working in the north that is based south of 60 should be outside, or whatever, that there should be something included in it. I noticed by the clock Madam Chair that we are running out of time. I think I will move at this time a motion that we extend sitting until we conclude this matter and I would also ask, and bear with me, Madam Chair, that Mr. Kakfwi will come back with my answer to my earlier question on what type of strict parameters we can put in there to take care of the multinationals and the extra-territorial companies. Thank you, Madam Chair.
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
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The Chair Jane Groenewegen
Thank you, Mr. Picco. Mr. Picco has put a motion on the floor. The motion is in order. All those in favour of extending sitting hours until this matter is deal with please signify with a raised hand? All those opposed? Motion is carried. We will extend sitting hours to concluded this matter. Thank you, Mr. Picco for your question. Mr. Kakfwi?
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 553

Stephen Kakfwi Sahtu
Madam Chair. There has been, as I have said earlier, extensive discussion about this policy in previous years. It started over two years ago. We have had the benefit of comments and advice and input from members all across our communities and our businesses communities, some very learned people, some very insightful people, and I appreciate what the Member is saying. For instance, it may be a way to consider, I cannot say at this time. For instance, where there are two competing businesses and one is clearly northern owned 100 percent and one is not, but both have equal investment in real dollars in a particular community, should one be given special consideration? I cannot say at this time, I can only say that it has been advanced by some people to be considered. It is just difficult to give Members any more assurances than to say we set up a working group, there are recommendations listed there, and those recommendations and perhaps even others that may not be listed at this time will be considered in the development of our recommendations or list of recommendations that we will bring to Cabinet.
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 553
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
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Edward Picco Iqaluit
Thank you, Madam Chair. Moving off that and to give someone else a chance to bring up that area, I would like to ask a couple of questions on the standing orders and the manufacturing policy.
In my region we have some manufacturers, but they cannot compete east/west. For example, if the manufacturer in my community builds windows, to ship them to other communities he has to ship them from Iqaluit, for example, down to Montreal where they have to be re-crated, and then come back up on the sealift, to be shipped to other communities. Whereas, in the west, the windows could be shipped by, let us say from Hay River or Yellowknife or anyone on the road system, down to Edmonton and across the country, which I talked about earlier before.
There has been something put into place to address this area, where the standing orders or the manufacturing policy, are based territorial-wide. They should be based regionally. I am wondering if the Minister has looked at this? I know there is some note of it in the report, but my question to the Minister is, will we look more in-depth at the manufacturing policy and the standing orders to base them regionally, as opposed to territorial-wide?
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 553
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 553

Stephen Kakfwi Sahtu
Thank you, Madam Chair. One of the recommendations that the working group made was to consider the northern manufacturing directive and to rationalize its application and the proposed incentive rates. That is a specific recommendation made that speaks to the point that the Members has raised. We have that from the working group to deal with and I have said that all these recommendations that are listed now will be given some very serious consideration and it will help us make our decisions on what to advance to Cabinet to help make its decision. Thank you.
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 553
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Page 553
Edward Picco Iqaluit
Thank you. I realize that that was in the report because I did read it. My point was that the committee recommended it, but when we apply your checks and balances here on this policy, I want to make sure that the Minister is aware and that his departmental officials are aware that there will be great lobbying from different areas of the territories that have benefited from this policy. Whereas, you might have a small manufacturer, for example in my area, which may not have the same input.
I would say to you and say to this House that this standing policy, at the present time, is costing this government a lot of money. An example I can give you is with furniture, where in one of our government buildings, a table was broken and instead of having to go to the Bay and spend a $150 to buy the table, we had to purchase it from somewhere in the western Arctic. To get the table to Iqaluit, it had to be shipped down to Edmonton, flown across to Montreal, and then up. What is the cost for paying for this?
My question to the Minister would be, that when he is taking the recommendation forward, is to look at the cost. Can the Minister tell me if his officials or himself can give me a cost, at this time, of what that directive is costing this government, on a price comparison basis?
I think if we would address this area, we might be able to free up some of the millions of dollars that we are trying to cut now and to help Delta House or to help the senior citizens or whatever. I think it is a very legitimate point. Thank you, Madam Chair.
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
Item 19: Consideration In Committee Of The Whole Of Bills And Other Matters
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The Chair Jane Groenewegen
Thank you, Mr. Picco. That is a very detailed question and it calls for a very detailed answer, but I will let the Minister respond. Mr. Kakfwi.