I am prepared generally, and as quickly as I can, so we can get on to other business of the House, Mr. Chairman. First of all, I want to applaud all Members for their comments. In particular, I want to applaud Mr. Ootes for a well-laid out presentation. He has obviously done a considerable amount of work and he deserves a lot of credit.
Perhaps when we brought forward these P3 there was a great deal of excitement about it because people are looking for new opportunities and new job creation and private sector, et cetera. I would hope what I can do in my brief comments I am going to make today, is kind of reducing peoples' expectation. There is a limit to what we can do with these P3. With all due respect, when you refer to projects of a billion dollars, et cetera, that is what we are talking about here. We are talking about very, very small numbers. It is very important we say today the expectation, I have anyway, is not anywhere near any of these kinds of numbers.
Mr. Picco had indicated he was concerned we would be going beyond the capital. I want to make it clear today, the P3 as I see it, is for capital only. I think that answers some of the concerns he had. It is important projects are analyzed. Once the projects are defined, they are to be analyzed on an individual basis. We have to determine what the appropriate savings are and what the net benefit is to the government. We are prepared to do that. I am as equally concerned as everybody else in this House about the long-term costs. In fact, new governments will have to pay this. Therefore, it is critical we do have an arrangement with the Interim Commissioner in the east and an acceptance in the west of the fiscal obligations in any of these projects. I am fairly confident we can get that.
Some of the key areas of concern expressed in Mr. Ootes' presentation were the contracting policies with respect to RFPs. As I have said to him on numerous occasions in this House and I do not think I have to say it again, we are working with the NWT Construction Association. My staff spoke to Mr. Aho this morning with respect to contracting policies, in particular RFPs. We can answer the concerns about transparency with industry and the public at large.
I have had four meetings with the Construction Association. We are continuing to do that. The discussion about maybe some kind of panel or advisory board, I am not discounting that, but I have not made a decision on whether we should do that or not. If we do it, I would see it as an external board made up of possibly private sector and labour, et cetera. It is certainly under consideration. When you look at that, one of the other comments that was introduced was the need for an independent review of the process when the problems arise. We certainly have with the hiring of Mr. Coles been able to draw upon the problems associated within other constituencies. There is a great deal of learning to be gained there, which is probably another important recommendation being made. I am certainly prepared to take a hard look at that. In fact, Mr. Coles is currently reviewing some of the problems that took place, for example, in New Brunswick for the schools, et cetera.
Mr. Picco had made some reference to the public sector. I am fundamentally of the belief that the private sector on a number of occasions, not in all instances, but on a number of occasions, can do it more cost effectively than government. In fact, it can access tax concessions. It can write off its interest payments where governments cannot. You have to believe when you move on the P3 that the premise of the private sector can do it on a more cost effective basis is one of the reasons, not the only reason, for moving in that direction. At the end of the day, the overall cost to government will be less. However, I think it is important, again, as several Members said, projects have to be analyzed on an individual basis.
I do not think there will be any clear way. This is one way to do it versus another way to do it. It requires some flexibility. I hope we can do that. I do not want to go on and on, but for me, three or four key issues are: long-term fiscal obligations and affordability. We have got to, if I may, deal with each individual project as it comes forward and determine what the cost benefit is. This has to be done and has to be transparent. There is a need for transparency, so that people see the projects that have been approved. I have already said, in this House, to previous questions, that we will advertise the projects and we will discuss with industry and others what the projects are.
The need for checks and balances, as I have said earlier, I am prepared to look at and I will not commit today, but I am prepared to look at some kind of panel, some advisory board that can provide external advice or overseeing of the policy. I think that is a valid suggestion and, certainly, we are looking at the need for clear contracting policies. As I have said, we have been working on that for months. We are certainly working very diligently on the RFPs because that is one area that consistently comes up here. I do not see any other way of doing the P3 but through an RFP. If the Members have some other suggestions, I would be prepared to listen, but I do not see how you can do it any other way. What are you looking for? You are looking for private sector initiative. You are looking for private sector ideas. You are looking for private sector funding. You are looking for private sector creativity, et cetera. It is going to have to be done through some RFP and, clearly, there is going to be a need to be much more transparent than we have in the past. I am politically committing to that today.
The last issue or the main issue, for me, is the affordability issue and the fact we will be committing future governments to long-term fiscal obligations. Let us say, clearly, in this House, we are ready to do that. We do that through our lease arrangements. We do that through our capital expenditures, et cetera. It is incumbent upon us to make sure the parties who are going to be involved in the division of the territories, Interim Commissioner and the new western government, are intimately involved in the fact there will be new long-term fiscal obligations. Whether it is in the construction of the Nunavut hospital in Iqaluit or, for example, the one in Inuvik, these are the obvious ones.
In closing I would say we are still learning about the P3. It is expected by the constituency out there that they want us to move in a fairly expeditious way, so we can get some things on the ground, put people to work and get the infrastructure that is needed in the communities. I am fairly confident we can do that. I am going to commit today, after discussions with my cabinet colleagues that, obviously, the House has to be involved through the committees. We would share that all with everybody and seek their direction and advice on the projects. I want to say again. This is not a panacea for everybody's favourite project. This is not a panacea for multimillion dollars' worth of expenditures. This is just another way of adding to and enhancing our current spending in capital infrastructures. I hope in my brief response I have been able to answer some of the problems or some of the issues raised. They are valid. I have Mr. Ootes' well laid-out presentation today, and I think it is probably reflective of how we all feel, including myself. The only note of caution I would say is we have some obligation and responsibility to move relatively quickly. I may differ there, in that, we want to get some things moving in 1998-1999.
In conclusion, Mr. Chairman, I do appreciate the comments made by the Members. We will take them into full consideration. All Members will be involved. Let me repeat. All Members will be involved in the final outcome of the projects. They will be done based on the criteria set on merit and no political interference. There is certainly going to be political direction. This is why we are here. I see these projects coming forward based on need, et cetera, based on the criteria we set.
I think Mr. Picco said, which I think is an appropriate one, he probably plagiarized it from the report, but he did say, if my memory serves me correctly, that the P3 would require a shift in organizational thinking. I think that was it. I think this was from page one of the report. I am not sure. I agree with him. Clearly, there is a need for a new way of corporate thinking. The reason I bring that up is because I want to remind everybody that today, Mr. Coles is in town dealing with our senior managers, explaining what P3 are about, getting them committed to the projects, getting them to understand it means a shift in thinking, et cetera, so we are, in fact, trying to do that at the senior management level. In conclusion, gentleman, I hope I have been able to answer some of the questions and if there are any others, I would only be too happy to do it today or we can deal with it later next week. Thank you.