Thank you, Mr. Speaker. Mr. Speaker, the committee review of the draft Government business plans and Main Estimates is an integral part of the annual budget development process within the consensus model of government. This year, division of the Northwest Territories resulted in changes to the committee structure of the Legislative Assembly over the course of the business plan and Main Estimates review. Before division, the draft western business plans and Main Estimates were reviewed by the Ordinary Members of Western Caucus. The Members divided into two subcommittees, the Subcommittee on Social Programs and the Subcommittee on Resource Management and Infrastructure, to consider separately the budget issues for departments within those envelopes. All Ordinary Members of Western Caucus reviewed the plans and estimates of the Legislative Assembly and the Language Commissioner. The business plan review was conducted in November, 1998 and the draft Main Estimates review in March, 1999. Since division, all Ordinary Members of Western Caucus now meet as the Standing Committee on Government Operations, and the Subcommittees are now standing committees. In the interest of continuity, the review committees will be referred to by their present names.
Mr. Speaker, it was decided by the Members of the Standing Committee on Government Operations to take a new approach in this year's report on the Main Estimates. In previous years the committees had reported on their reviews of the business plans, but the report was an internal government document that was not released to the public. The report on the review of the 1999-2002 business plans was prepared following this year's review and provided to the government in January 1999. However, Members believe that their review of the departmental business plans is an integral part of the Main Estimates review process. To show this important correlation, the standing committees have incorporated their comments and recommendations on the business plans with their report on the review of the Main Estimates. This will give the public a greater understanding on the process leading up to the tabling of the Main Estimates in the House.
General overview.
During the business plan review, Members raised a number of concerns that are common to all of the business plans and pointed out issues of government-wide importance that require common strategies. Where appropriate, government responses to the committee concerns following the business plan review are incorporated and commented on by the committee in this report.
The business plans put forward for the new Northwest Territories focused on balancing the budget and creating a more effective and responsible government. With a balanced budget and a restructured government organization, the government's main focus is on addressing the critical issues and seizing opportunities facing the new Northwest Territories. The annual review of business plans by committees emphasizes the concept of "outcomes" rather than "inputs". The committees evaluate results achieved by the departments within their envelopes and assess each department's financial situation. Further, the committees make recommendations to reduce the departments' financial and operational risk, to ensure effective decision-making and bring about efficient service and program delivery.
Throughout the review process, the committees recommended that a consistent business plan template be adopted across government. The adoption of a common template will help to achieve an increase in accuracy and provide more relevant, understandable and timely information for committees and the public. A government-wide template will instill better accounting for the government's financial affairs, plus better accountability for the government's performance in achieving legislative objectives. Ultimately, this will provide better value for the taxpayers' money.
Mr. Speaker, Members recognize that progress has been made in standardizing the business plans between the departments. This has made it easier for the committees to move from department to department in their review. However, while the general format and presentation order are common to most departments, further progress can be made. As well, the level of detail provided under each of the headings of the business plans varied greatly between the departments.
With each year, accountability becomes more complex, and there is a fundamental requirement for better information. This will become increasingly evident as the government continues its evolution from direct program delivery to service management. An increasing proportion of public funds is being spent through alternative service delivery arrangements at the regional and community levels with little or no control over day-to-day operations of service providers.
The business plan and main estimate process provides the committees the only true opportunity to examine the progress the government makes in meeting the needs of northerners. If the business plans do not contain an adequate level of detail, it is impossible for the committees to garner true understanding of the total picture.
Members understand that division and downsizing have dictated the departments' agendas over the last three years. This reality has to a large part been the focus of attention for departments and committees. However, with the resolving of many of these issues it is time to refocus on western issues and concerns. The following are specific suggestions and concerns the committee had with the business plan content.
Under Benchmarks and Targets. The Standing Committee on Government Operations understands that division, and the lack of applicable western statistics make it difficult for the departments to establish benchmarks to measure success in meeting departmental goals and target objectives.
However, without initial benchmarks and projected targets, it is impossible for the committees to judge from previous years' business plans whether the departments have been successful in meeting their objectives and whether the Committees' faith in the departments' business plans was justified. Members of the Standing Committee on Government Operations are concerned that with limited revenue growth, and often a high turnover and shortage of qualified staff, the gap between quality program and service delivery standards and the capacity to achieve them will continue to grow. To minimize this, specific indicators should be adopted to provide accurate and timely performance information on a continual basis throughout the year for each department. This benchmarking process will hopefully provide the departments with a consistent flow of relevant and reliable information that will allow managers to keep track of progress and adjust operations, even in mid-course, in a timely manner.
The Standing Committee on Government Operations had recommended in its report to the government on the business plans that the departments' next business plans include benchmarks and target goals that are quantifiable and measurable and that further efforts be made to use a consistent business plan format among departments. The government's response indicates that experience in other jurisdictions has shown that the development of appropriate measurement systems for major programs and the implementation of tracking systems for cross-departmental initiatives can take three to five years. The government indicated that they would continue to work on improving performance in establishing target goals and benchmarks.
The committee can appreciate that it takes time to establish target goals and benchmarks for any new program or government initiative. However, committee Members stand by their recommendations made during the business plan review. It is felt that in the absence of target goals and benchmarks for programs, the departments have no need to adhere to a work plan or to strive towards a projected outcome. Committee Members believe that even setting minimal yearly goals and objectives for new government programs would give the committee and the government a starting point.
Under Human Resource Implications, Mr. Speaker. The Department of Justice's overview of the human resource implications it is facing provided a level of detail that other departments would do well to emulate. One of the major concerns that Members have had is with the success of the government's Affirmative Action Program. The Department of Justice Affirmative Action Plan provided the Standing Committee on Social Programs an understanding of the department's progress and goals in meeting the challenge of creating a truly representative workforce in the GNWT civil service. The plan, complete with actual numbers and status of affirmative action employees, provides a benchmark for the committee to determine the success of the department in meeting its affirmative action targets in next year's business plans.
Members were also concerned that the departments were using casual and term positions to meet their operational requirements. While this may be necessary to provide government services to residents, it appeared to the Members of the Standing Committee on Resource Management and Infrastructure that these casual and term employees were not included as part of the final tally of departmental employees.
The Standing Committee on Government Operations recommended, during the business plan review, that the departments examine the level of detail contained in the Department of Justice Human Resource Implications section of the business plans and incorporate that format and information. The government is in the process of redefining the Human Resource Implication section of the business plan and has advised that it will consider the committee's recommendation in the formulation of the new standards for the section of the business plans.
The committee also recommended that each department provide a position summary, which is to include the position description, geographic location and detail as to whether the position is filled, vacant, casual, term or indeterminate in the business plan. The government agreed to this request and has supplied the information. This will allow the committees to track person years over time and help them to ensure fair distribution of government employment opportunities.
The committee's final recommendation in the Human Resource Implications area was that complete organizational charts should be included as part of the information provided for each department including position titles and names of incumbents. The government agreed to this request and has supplied the information. Mr. Speaker, the committee understands that once the People Soft Personnel System is up and running it should be easier for the departments to provide this information. Organizational charts, for all levels of the departments, assists the committees to track changes brought about by restructuring .
Under Financial Reporting Issues. It was a time-consuming exercise for the committees to examine the financial information present in some departments' business plans in the absence of last year's financial figures. Committee Members realize that this is a one-time event that is due to division. However, in the future it should be possible for the departments to include the last year's financial figures as part of any information presented to the committees in the business plans. This would assist the committee Members in their deliberations by providing year-to-year reference points. Again, the government has agreed to this request.
Under P-3 Projects. Several Members of both the Standing Committee on Social Programs and the Standing Committee on Resource Management and Infrastructure were concerned about the lack of inclusion of P-3 projects in departmental business plans. Members believe that the business plan and budgetary processes provide the committees with their best opportunities to examine the operations and maintenance and capital requirements of the departments. Without information as to planned P-3 projects, Members believe that their oversight responsibility for the departments has been abrogated. Members also believe that the information on planned P-3 projects should include any projected operations and maintenance costs that have been identified.
The committee recommended that a separate section be included in each department's business plan that outlines any planned P-3 project and any identified operations and maintenance costs associated with the P-3 project and that P-3 projects be included in the capital planning process. The government has agreed with this request and will incorporate the information in future business plans.
Mr. Speaker, under Main Estimates. As part of the review of the draft 1999-2002 Main Estimates, the government presented the 1999-2000 Interim Appropriation. The presentation incorporated the government's fiscal outlook for the Northwest Territories. The government's projections confirmed the committee's forecast of an impending deficit. The government's current fiscal projections for 1999-2000 forecast a $9 million accumulated surplus. However this may be considered optimistic, as the government in its low expenditure pressures scenario for the 1999-2000 year projects a $15 million accumulated deficit, and in its high expenditure pressures scenario, forecasts a $34 million accumulated deficit. It should be emphasized that the government's high expenditure pressures scenario does not include all expenditure pressure factors. In its summary of expenditure pressures, the government forewarned that its scenarios include only those expenditure pressures quantifiable at this time, major requirements have not been quantified yet and will drive up these amounts. Program expenditure pressures include the high birth rate, population migration - from smaller to larger centres, political uncertainty, increasing unemployment, low education levels, decreasing revenue - including federal funding decreases and finally aging infrastructure and facilities.
Mr. Speaker, the committee realizes that unless new sources of revenue are acquired, or more effective and efficient means of using our current resources are found, the government's ability to deliver programs and services at acceptable levels may be severely compromised. Due to continued dependence on the federal government for the majority of our budgetary revenues, a limited ability to meet growing health, education and social pressures, limited revenues to invest in economic development, and a limited return on economic development - since a majority of revenues accrue to the federal government, the Government of the Northwest Territories may find itself unable to comply effectively with expenditure pressures.
The government's fiscal projections forecast a 2000-2001 accumulated deficit of a low of $86 million to a high of $144 million, further forecasts for 2001-2002 project a low deficit of $186 million to a high of $301 million. As outlined, in its review of business plans, the committee recommended the adoption of benchmarks or performance indicators that could provide the departments and the committees with a reliable source of information that would allow for tracking and adjustments of government programs and activities. With the potential for large accumulated deficits, the adoption of performance indicators, a consistent reporting template and clear lines of accountability have now taken on a greater importance.
Mr. Speaker, there are issues of government-wide importance and implications. Under the Northern Accord, committee Members believe that the time required to deal with the issues leading up to division has meant that work on this important file has not received the attention that it requires. The negotiation of an equitable Northern Accord becomes more and more important as new diamond mines and gas and oil fields come on line and increased resource revenues flow south. If there is to be any hope of the Northwest Territories to become economically self-sufficient, the Territorial Government must have control of lands and resources for the benefit of all northerners.
Committee Members believe that the government has to allocate the appropriate resources to deal with the Northern Accord. It is hoped that in cooperation with aboriginal organizations, the government can make significant progress on this file in the upcoming fiscal year.
Mr. Speaker, under the year 2000 compliance. This will be the last probable opportunity for comment on this issue by the Members during the business plan review process. Next year's business plans will be too late for committee comment on year 2000 compliance, because if the departments haven't dealt with the issue it will be a moot case. Members are very concerned that the large government computer platforms and systems will not be in compliance on December 31, 1999. Members achieved no measure of comfort from any departments' informatics plans that they will be in year 2000 compliance.
The Standing Committee on Government Operations recommended during the business plan review that efforts be doubled to ensure year 2000 compliance. Members would appreciate regular updates as to the progress made by the departments. The government's response to the committee's recommendation is that the Informatics Policy Committee of the Financial Management Board is continuing to make significant progress on year 2000 compliance. The committee sincerely hopes that the government's confidence is justified.
Mr. Speaker, under contracting of services to Nunavut, Members expressed concerns during the business plan review that there are no consistent government-wide approaches to the ongoing and anticipated contracting of services to Nunavut. Each department seemed to be in the process of negotiating their own service agreements with their Nunavut counterparts without any central strategy or template from the government having yet been developed. Members understand work on this is underway. Members are concerned that these contract service agreements with Nunavut should contain provisions for cost-plus recovery as part of the contracting requirement. The government's response allayed the committee's concerns. The committee was advised that there is a consistent government-wide approach and a cost-plus factor of 6.5 percent incorporated into Nunavut service agreements.
Under informatics strategies, several Members are concerned that there is lack of cohesion between the departments on the development of common informatics strategies. Although the Financial Management Board is in charge of developing the common Financial Information System (FIS) and a human resources system, there appears to be no one ensuring that the departments purchase compatible computer platforms. The Standing Committee on Government Operations recommended during the business plan review that there be closer, apparent co-operation between the departments and the Financial Management Board on informatics strategies.
The government's response indicates that the Informatics Policy Committee of the Financial Management Board is charged with the review and coordination of the departments' annual informatics plans. The Informatics Policy Committee reviews the plans to ensure compliance with the current government-wide Informatics Strategy and to look for opportunities for the departments to share informatics technology. The government admits that the Informatics Strategy is five years old and outdated in today's government's realities. The Financial Management Board will be working with the departments to develop a new strategy that will better support the business goals of the Government of the Northwest Territories over the upcoming fiscal year. The Standing Committee on Government Operations looks forward to reviewing this new Informatics Strategy when it is available.
Mr. Speaker, under Employee Appraisals. It is understood that during the time of upheaval surrounding division, many of the common practices of government may have been lost in the rush to deal with the myriad issues facing each department. Nonetheless, some Members believe that the departments are missing out on a potential source of feedback from employees on departmental success in meeting their goals and strategies. Members of the Standing Committee on Social Programs were impressed with the deputy minister of Health and Social Services proposed methodology to ensure that employee appraisals are completed in a timely fashion by tying the awarding of performance bonuses to senior management to employee appraisals.
The Standing Committee on Government Operations recommended during the business plan review that all deputy ministers tie the awarding of senior management performance bonuses to their success in completing employee appraisals. The government indicated that this is one of the criteria, but not the only one, in the awarding of performance bonuses to senior management. The committee recommends that the departmental completion rate for employee performance appraisals be included as part of the mid-term activity report.
Mr. Speaker, under highway strategy. Members of the Standing Committee on Resource Management and Infrastructure see a need for the new western territory to develop a highway strategy that links every community in the Northwest Territories. Members believe that there are significant savings to be realized in the social program envelope through the development of a comprehensive highway system.
The Standing Committee on Government Operations recommended during the business plan review that the Department of Transportation undertake a review of the current highway system in the Northwest Territories with a view to extension to every community. The Department of Transportation indicated in their response that this has been part of their mandate since the formation of the department. While this may be a true statement as it relates to the internal corporate history of the department, the committee feels that this goal needs to be communicated to the people of the Northwest Territories. Division provides a perfect opportunity to refocus the Department of Transportation's goals.
Under government initiatives and ministerial responsibility, Mr. Speaker, Members were concerned that recent government strategies such as the Economic Development Strategy fall under the auspices of the Financial Management Board instead of the department where the primary focus of the strategies exists. Members are still not convinced as to the government's rationale for this. The Standing Committee on Government Operations recommended during the business plan review that any strategy developed by the government be tasked to the department that is the focus of the strategy. The government generally agreed with this recommendation in their response.
Under government Conflict of Interest Guidelines. At the time of the business plan review, recent events had dictated that there would be a review of conflict of interest guidelines for MLAs, Ministers and their respective spouses, as well as senior management. Members felt that it may be appropriate to also conduct a review of the conflict of interest guidelines for entry level and middle management employees. The Standing Committee on Government Operations recommended during the business plan review that a review of the conflict of interest guidelines for entry level or middle management employees be conducted by a committee struck from departmental human resource professionals in consultation with the Union of Northern Workers.
The government's response was for further study and a submission to the Conflict of Interest Review Panel. The Report of the Conflict of Interest Review Panel, presented April 8, 1999, makes no reference to middle managers or entry-level positions. Committee Members remain convinced that this is an opportune time to examine the conflict of interest requirements for all employees of the Government of the Northwest Territories in conjunction with the Union of Northern Workers.
The Committee recommends that a review of the conflict of interest guidelines for entry level and middle management employees be conducted by a committee struck from departmental human resource professionals in consultation with the Union of Northern Workers.
Under Policy Development. There is a concern that the present policies and guidelines of the Government of the Northwest Territories do not reflect the realities of governance in the new western territory after division. This is a perfect opportunity for all departments to re-examine their policies and work together in developing policies that meet government objectives in a manner relevant to our new territory. The Standing Committee on Government Operations recommended during the business plan Review that all government departments re-examine their policies in light of division and develop, in cooperation, policies that meet the goals and objectives of the Government of the Northwest Territories and meet the needs of NWT residents. The government in its response agreed with this requirement and assigned the Department of the Executive to co-ordinate the review of policies in light of division and to identify gaps in the GNWT policy framework that require attention to better meet future needs. Committee Members look forward to providing their input when the review of policies is complete.
Mr. Speaker, under Building Pilings in Inuvik. Members of the Standing Committee on Social Programs were concerned about the impact of rotting building pilings in Inuvik on government departments other than the Northwest Territories Housing Corporation. Members were also concerned that rotting pilings might not be an issue confined only to the community of Inuvik. The Department of Municipal and Community Affairs, in the eyes of committee Members, has a responsibility to assist the Town of Inuvik in assessing the potential impact to the town's infrastructure. The other departments with infrastructure in Inuvik also have to develop action plans to deal with this issue. In addition, should the issue of rotting pilings prove to be beyond the fiscal capabilities of the GNWT and its agencies, federal relief funds should be accessed if possible.
The Standing Committee on Government Operations, during its review of the business plans, recommended that the Department of Public Works and Services take a lead role in developing an action plan to deal with the potential impact of rotting pilings on government infrastructure in and around the Town of Inuvik. The government's response indicated that the Departments of Public Works and Services, the Northwest Territories Housing Corporation, the Town of Inuvik and the Inuvik Housing Association are coordinating their activities to share knowledge, avoid duplication and to keep costs to a minimum.
The committee also recommended that the Department of Municipal and Community Affairs render all required assistance to the Town of Inuvik in assessing the potential impacts of rotting pilings on the town's infrastructure. The government's response indicated that the Town of Inuvik completed the survey of their buildings in the fall of 1998 and identified four buildings that require repair. The Town of Inuvik is dealing with these buildings. The Department of Municipal and Community Affairs is on the Inuvik Utilities Planning Committee, which has been dealing with pilings that support the utilidor system over the last number of years and has contributed financially.
The committee also recommended that the government also ensure that rotting pilings are not an issue in any other western Arctic community. The government's response indicates that the Department of Public Works and Services and the Housing Corporation believe that this is not an issue in any other region other than the Inuvik region. The committee's final recommendation was that should the rotting pilings issue exceed the fiscal capability of the GNWT, federal relief funds should be accessed if possible. The government has agreed with this and, should the financial requirements exceed the government's fiscal capability, will apply for federal relief.
Mr. Speaker, that concludes my introductory comments on the committee report of the 1999-2002 Business Plans and the 1999-2000 Main Estimates. I move that the report be referred to the committee of the whole for consideration in concurrence with the 1999-2000 Main Estimates, and Mr. Speaker, I further seek unanimous consent to waive rule 93(4) and have the report moved into committee of the whole for today. Thank you, Mr. Speaker.
