Thank you, Mr. Chairman. I hate to follow up Ms. Lee's comments with some more sobering comments of my own, but I do have some concerns about the very same proposal.
Although I also support an infusion of money into our transportation infrastructure, I think that it is important that we carefully analyze and assess exactly how we are going to go about doing this. I used the analogy in a Member's statement earlier that I think everybody would support putting more money into our transportation infrastructure, but I do not think too many people would support the department coming around household by household, knocking on doors and asking everybody to ante up $10,000 or $15,000 a family.
While those numbers may be extreme, I think it is critical that we get a good handle on exactly what kind of money we are talking about. I think the committee indicated their endorsement for this proposal, but they wanted to make sure that the impacts on northern residents were going to be mitigated. I believe they used the word "minimal". I think that is critical. I think when we look at the consumer price index here and realize the cost of living in the North is so high, anything that we do to further increase that I think would be a mistake.
We are asking municipalities, we are asking industry to try to get their employees to live in the North and not to be in a fly-over situation where they live south and work up here, but one of the hard sells we are having is convincing people of that. There are other things that have to be factored in. Quality of life is very important, but costs continually come up. When people look at these comparisons to the cost of living in Edmonton or Calgary or Grande Prairie compared to Hay River, Yellowknife, Inuvik, it is tough for them to swallow. As long as it is easy to fly into these locations, I think it will continue to happen, especially if we further raise the cost of living.
I know the department has done some calculations and looked at what they felt the impact per household of the Northwest Territories would be from this increased toll. I am not sure what the average size of a family is in the Northwest Territories, but I believe the department used a family of three. They also took a look at an average consumption of groceries and fuel per family, but there are a lot of other expenditures made by families that they were not able to calculate and they admit this, but I think they are significant.
I think that you will see that when you go here locally to the building supply store to buy two-by-fours and you buy the materials to build a new house, we could be talking about a significant amount of money on the price of building a new home in the North. I think these are big-ticket items that people will look at and compare these figures from now and then. I think if the increases are significant, we will hear about them, they will be in the media. This will certainly deter people from moving here.
It is important to also factor in not only groceries and fuel, but as much of our expenditure. We have to get a handle on our entire expenditure picture. If the tax credit can entirely offset this, that is one thing. If it can partially assist Northerners in paying these additional bills or mitigate partially, that is quite another thing. I am reserving any show of support for this until I have a clear picture in my mind exactly what it is going to mean for my constituents and for all Northerners.
Another thing is that it involves, by any estimates, is quite a significant amount of new borrowing. There are a couple of factors that have to be considered here. Certainly we are going to have to raise our borrowing limit. That has been discussed. While I think many of us can see that theoretically this can be self-liquidating if our projects on the amount of tolls we can collect are accurate, if we are way off, if the boom cycle that we are now in really peters out after the next few mines, then I do not know where that leaves us if we do not have the capacity to collect the kinds of tolls we think we will. We have to be careful here.
I think also if we are all convinced that we are on the verge of getting a resource revenue sharing deal with the federal government, that will also put us at ease and maybe make us feel that borrowing this $40 million is the right thing to do. However, if we have concerns, if we are not convinced, if we do not believe that the federal government is committed to devolution and resource revenue sharing, then I think some of us will further worry about that.
We have heard some good things from Minister Nault about devolution, but we all know there is a bureaucracy in Ottawa that does not seem motivated and cannot seem to understand that this would be a win-win situation. When the Minister indicated that he was not prepared to move DIAND positions to the Northwest Territories from Ottawa, it was a real slap in the face for this level of government. His concern for the families in Ottawa and not wanting to uproot these folks and move them all the way up here, I think that was a message loud and clear to us that maybe we are not as close as we might like to think.
The other thing that I am concerned about with the new borrowing is there are no indications that this toll will not be clawed back in our next revenue sharing arrangement. I think that we are going to do our best, as the Minister of Finance has said, to get an arrangement that works for Northerners and is agreeable and is positive, but there are no guarantees in this kind of thing.
One more concern, Mr. Chairman, I have is with this concept that trucking companies will simply pass the toll on to northern businesses who are not going to be expected to eat this because they will pass it on to consumers. For households, we have a tax credit. For the people we are really after and we are attempting to get royalties from industry, we are assuming that industry will pay the tab and that northern businesses will not be stuck with the bill, but I think there are situations where there are long-term supply arrangements with mines in place.
Northern companies have an agreement for the next five years to provide, for example, widgets at a certain price. The mines may simply say to them, we have a deal for the next five years and when that deal is up, we can renegotiate. So the commercial toll will simply come out of the contribution margin of these northern businesses. I do not think that was ever the intent. I hope this was thought through and I guess we will see exactly how many of these long-term arrangements are in place.
As I have indicated, Mr. Chairman, I am thrilled to see the department is taking a proactive approach and, as Ms. Lee has indicated, they are trying to stop talking about what we cannot do and they are trying to find new ways to think outside the box a little bit here and get our infrastructure upgraded and we desperately need it. I just need to be convinced that Northerners are not going to be bear the brunt of this because I think that is going to be critical for all of us.
The other thing I wanted to talk about was the program and functional review. Just briefly, I think when you talk about tolls that will increase our cost of living and you talk about airport landing fees, airport-lease rental, there are other things outside this department like the hotel tax proposal. I think the accumulated impact of these new additional levies, taxes and tolls is certainly going to have an effect on life in the North.
I hope we have a clear picture and a clear understanding of just what the total impact of all of these things will be. It is easy to look at each of these things in isolation and say, for instance, a total of this amount of a hotel tax of five percent or an airport landing fee for this amount seems small, but when you add them all up, I think we have a fragile...especially in tourism. I think the market is very fragile. I think these are people who come in here quite often who are very price-sensitive. We are going to have to be careful to make sure that we do not tip the balance.
I think there is sort of a break-even scenario that we have to run to make sure that we are not...we want to raise money, but we have to make sure in trying to do so, we are not keeping tourists from coming here because that certainly would not be very productive.
I would be interested to hear the Minister's thoughts on the cumulative impacts of some of these initiatives in his department specifically under the program and functional review. Thank you.