The Department of Transportation introduced its proposed Transportation Strategy to the Standing Committee on Governance and Economic Development during discussions on its 2001-2002 Main Estimates. The strategy is expected to cost $100 million over the next four years. Further, the strategy would introduce a user fee of five cents per tonne per kilometre for commercial traffic on territorial highways and is projected to generate $15 million in revenue that would be directed specifically to improving the territorial highway system. User fees would be managed from a dedicated highway investment fund trust and leveraged to meet initial capital requirements. A user fee would not affect federal funding transfers to the territorial government.

The committee, while recognizing the need for a safe and well-maintained territorial highway system, advised the Minister that any user fee would be passed on by the transportation companies to the consumer, northern businesses and government. With transportation costs already high because of our remoteness and the rising cost of fuel, this user fee would significantly impact upon our standard of living.

The department replied that some of the increased costs would be mitigated by a cost of living tax credit for NWT residents. The committee supports this strategy in principle. However, final support is conditional upon the committee receiving and reviewing additional financing and strategy details and assessing their impact upon northern residents.

Due to the significant impact of this initiative upon the northern economy and the cost of living, the Department of Transportation and the Department of Finance agreed to give a presentation on the proposed Transportation Strategy and cost of living tax credit for NWT residents to the Standing Committee on Accountability and Oversight, which includes all Ordinary Members. The committee referred this issue to the Standing Committee on Accountability and Oversight in order to extend discussion to include other Members of the Legislative Assembly.