Thank you, Mr. Speaker. Composition of the board of directors is as follows: the proposed composition of the board of directors for the continued Power Corporation is outlined in Section 2(a) of the Unanimous Shareholder Agreement. This section states that unless the shareholders agree in writing, and notwithstanding the provisions of the by-laws of the corporation, the board of directors will consist of twelve members. The Western Territory will be entitled to appoint six directors to the board and Nunavut will be entitled to appoint four directors to the board.

The chairman and the president would also act as members of the board of directors. The chairman would, under the USA, be appointed by agreement of the shareholders and the board would appoint the president. The president may be, but does not have to be, appointed from the existing members of the board of directors. The proposed composition of the board of directors for the new Power Corporation drew sharp criticism from the Nunavut presentations to the standing committee. The Interim Commissioner's Office is concerned that the Nunavut board members would always be in a minority position on the board of directors. This concern is compounded by the fact that a majority of board members would constitute a quorum and any decisions could be made by a simple majority of that quorum.

Nunavut Tunngavik Incorporated also raised the points that the proposed board of directors was not consistent with the recommendations contained in the NIC's Footprints reports. In NTI's view, the shared arrangement model proposed in Footprints 2 requires equal political control. NTI suggests that it would be irresponsible of NTI to approve a share structure that results in a permanent disadvantage in voting shares. In NTI's opinion, a 50/50 share split between the two governments would represent institutionalized trust.

The joint submission from the Iqaluit/Baffin Chambers of Commerce also proposes equal representation by the two Territories at the board of directors level. The Chamber is of the opinion that anything less than 50 percent in shares or control would mean two Power Corporations are necessary.

In presenting on behalf of his constituents, Mr. Michael Miltenberger, the MLA for Thebacha, also agrees that it is inappropriate that the proposed agreement is indefinite and argues that a binding agreement should not be imposed on the two future territorial governments. He suggests that there should be an initial specified review period (perhaps three years) and a defined process for dividing the corporation. At the end of the review period, either party could decide to terminate the agreement. Mr. Miltenberger envisions the review and dissolution agreement incorporated into Bill 1, The Power Corporation Act.

Mr. Speaker, I would now like to ask Mr. Erasmus, chairman of the committee, to conclude the report.

The Member for Yellowknife North, Mr. Erasmus.

Thank you, Mr. Speaker. There was also

significant agreement among the presenters to the Standing Committee that a defined arbitration/mediation process should be incorporated into the Unanimous Shareholder Agreement. The proposed USA calls for the two shareholders to use their best efforts to resolve any disputes on the application or interpretation of the USA as quickly as possible. If the two parties cannot resolve the dispute, they agree to refer the matter to a mediator. If the parties cannot resolve the dispute with the assistance of the mediator, they agree to refer the matter to a sole arbitrator for resolution. If the parties cannot agree on the appointment of a sole arbitrator, the matter will be referred to an arbitration panel, made up of one member from the Western Territory, one member from Nunavut and the third member to be appointed by the two members appointed by the two Territories. The decision of the arbitrator will be binding upon the two parties. The party who is unsuccessful in the arbitration will bear all costs unless otherwise ordered by the arbitrator.

The Interim Commissioner's Office believes the dispute resolution process to be inadequate. The ICO believes that the terms, application and interpretation, need to be clearly defined. The Western Coalition suggests that a provision be added to describe the rules and procedures on arbitration and to stipulate the law to be applied to the resolution of arbitration. The dispute resolution clause should include the procedure for either party to give notice of their intention to enter into arbitration, a timeframe to select an arbitrator and the identification of the location where the arbitration is to take place.

Michael Miltenberger, MLA for Thebacha, expressed his view that the proposed arbitration process is too complicated. He is not confident that a dispute could be resolved in a reasonable length of time.

In conclusion, the Standing Committee on Government Operations has maintained since the beginning of the review process that passage of Bill 1, The Power Corporation Act is contingent upon successful negotiation between the ICO and the GNWT of a mutually acceptable Unanimous Shareholder Agreement. The Minister responsible for the NWT Power Corporation has advised the committee and the House that negotiations are ongoing and that the parties need time to negotiate an equitable agreement. Since the Fifth Session is expected to prorogue before Bills 1 and 2 can be considered in the context of an agreement having been reached, the responsible Ministers intend to introduce new legislation during the Sixth Session of the 13th Assembly. Although it may appear that the two sides are widely divergent in their positions on the future of the Power Corporation, the committee is hopeful that there are sufficient common positions between the Government of the Northwest Territories and the Interim Commissioner's Office to facilitate the successful negotiation of a Unanimous Shareholder Agreement.

Committee Members agreed that it was still important to report on the review and public hearings on the two bills to date. The standing committee will conduct a detailed clause by clause review of the reintroduced bills and will report to the Legislative Assembly on its review. Some technical drafting issues with the Power Corporation Act have been raised and will need to be addressed, but they do not impact upon the intent of the bill. Assuming the successful negotiation of a viable Unanimous Shareholder Agreement, the committee is confident that these issues can be dealt with at a later date.

Bill 2, An Act to Amend the Public Utilities Act did not elicit strong sentiments from the stakeholders making presentations to the standing committee. All parties seem to agree that the proposed amendments would be satisfactory if a mutually acceptable USA can be worked out. The standing committee recognizes that the proposed amendments are enabling provisions and that their usefulness depends upon the continued cooperation of the two Public Utilities Boards. The standing committee has no difficulty with the proposed amendments at this time.

Mr. Speaker, that concludes the report of the Standing Committee on Government Operations on the review of Bill 1, Power Corporation Act and Bill 2, An Act to Amend the Public Utilities Act.

I would therefore move, seconded by the honourable Member for Kivallivik, that Committee Report 7-13(5) be received by the Legislative Assembly and adopted. Thank you, Mr. Speaker.

Thank you, Mr. Erasmus. The motion is in order. To the motion. Question has been called. All those in favour? All those opposed? The motion is carried. Reports of standing and special committees. Item 12, reports of committees on the review of bills. Item 13, tabling of documents. Mr. Krutko.

Tabling of documents. Item 14, notices of motion. Item 15, notices of motions for first reading of bills. Mr. Arlooktoo.

Thank you, Mr. Speaker. Mr. Speaker, I give notice that on Monday, May 25, 1998, I will move that Bill 17, An Act to Amend the Territorial Court Act and the Justices of Peace Act be read for the first time. Thank you.

Thank you. Notices of motions for first reading of bills. Item 16, motions. Item 17, first reading of bills. Mr. Todd.

Thank you, Mr. Speaker. I move, seconded by the honourable Member for Baffin South that Bill 16, An Act to Amend the Income Tax Act, No. 2, be read for the first time. Thank you, Mr. Speaker.

Thank you. The motion is in order. To the motion. Question has been called. All those in favour? All those opposed? The motion is carried. Bill 16, An Act to Amend the Income Tax Act, No. 2, has had first reading. First reading of bills. Item 18, second reading of bills. Item 19, consideration in committee of the whole of bills and other matters. Item 20, report of committee of the whole. Item 21, third reading of bills. Item 22, orders of the day. Mr. Clerk.

Thank you, Mr. Clerk. This House stands adjourned to Monday, May 25, 1998 at 1:30 p.m.

--ADJOURNMENT