Thank you, Mr. Chairman. I too would like to make some comments in response to the Standing Committee on Governance and Economic Development's report on the public review of Bills 9 and 10.

For the last two years this House has heard many comments from Members on the poor condition of the NWT's highways, in particular, Highway No. 3 between Yellowknife and Rae. There appears to be a broad consensus that our highways urgently need upgrading. The Highway Investment Strategy, including the Commercial Vehicle Trip Permit Fee, is the government's response to these concerns. This strategy is the most workable alternative given the fiscal tools available to us.

The fee itself reflects the fact that much of the wear on the highway system is caused by large trucks. Levying the trip permit fee raises highway improvement funds from those who are responsible for most of the need for improvements. Some have suggested ways the government could borrow to meet the needs for improvements.

Mr. Chairman, borrowing the money for the highway improvement would only be part of the solution. Borrowed money needs to be paid back and any plan to borrow to meet our needs is incomplete if it does not include a method of repaying both the amounts borrowed as well as the interest on that money.

Since the strategy was outlined in the House earlier this year, we have seen a major change in the national economic outlook. The slowdown is expected to have an adverse effect on federal, provincial and territorial budgets. The links between our formula financing revenues and provincial spending and national economic growth mean that we may have even less fiscal flexibility to achieve our objectives without new revenue sources.

It has been suggested that the federal government should pay for part of the cost of highway improvements because it receives most of the benefits through resource royalties from the resource development that is contributing to the damage to our highways.

We agree and will continue to make this case to the federal government. However, we cannot delay the work on our highways while we wait for the federal government to respond.

It has also been suggested that improvements could be paid for by reducing other government spending. Given our current needs in health and education and other critical social programs, I do not believe that this option is workable.

During the public review of the bills, Mr. Chairman, there were strong objections voiced regarding the proposed fee, particularly related to its impact on consumers and northern businesses.

The government has listened to these concerns and is prepared to make changes to address them. Many people have expressed concern about the effect the fee would have on lower income people in the Northwest Territories. The increase to the cost of living credit passed in July partly addressed this concern, but not enough for many.

If the Highway Strategy is implemented, the government is prepared to consider further enriching the Cost of Living Tax Credit to provide for a minimum credit regardless of income level and will have the fiscal flexibility to consider introducing additional measures to reduce income tax for all NWT residents, based on recommendations of the Minister's Advisory Committee on Personal Income Taxation. These could include measures specifically targeted for seniors and people with disabilities.

Earlier this year, we increased social assistance food rates by an average of 7.8 percent and we made a commitment to monitor the effect of the fees on prices in the Northwest Territories. We are prepared to increase benefits for income support recipients and other programs for low-income individuals and families to reduce the impact of the fee. In addition to the changes proposed by the Minister of Transportation, I will propose several changes to the fund legislation itself.

Some people have requested that the legislation include a sunset clause. As Mr. Steen has mentioned, we are prepared to amend the legislation to ensure the fee and the fund end in five years, on March 31, 2007.

We are also prepared to commit that any new funds provided by the federal government for highway improvements will be used to offset the highway investment strategy expenditures and that the term of the fee would be reviewed in light of any such funding.

Concern was raised by the committee about our manufacturing sector. Our government has worked long and hard to ensure that we are building a manufacturing industry in the Northwest Territories. We have not overlooked or dismissed the concerns raised by manufacturers. In fact, as we speak, we have a committee made up of government officials and representatives of the manufacturing sector who are considering a manufacturing incentive program.

I hope these changes and those announced my Mr. Steen will address the concerns that have been expressed about the Highway Investment Strategy.

Mr. Chairman, finally, with all due respect, I have to say I am disappointed by the absence of clear options from the committee's review except to explore other options that we have spent a lot of the last year working on, or to lobby the federal government for more dollars.

I had hoped that if the committee shares the government's concerns about highway conditions, we would have heard more clear recommendations. I sincerely hope, Mr. Chairman, that we can continue to work together to develop those options to enable us to have the means to be able to improve our highway system. That, I am sure, is a concern that all of us share.

With that, Mr. Chairman, I want to say thank you to the committee for their report and the work that they did in holding the public hearings on this matter. I still believe there are ways we can work together to come up with a program that will resolve the concerns you have heard from the public and at the same time see much improved infrastructure for safer travel by all Northwest Territories residents. Thank you, Mr. Chairman.