Thank you, Mr. Chairman. The Standing Committee on Governance and Economic Development met with the Minister and his staff to review the Main Estimates of the Department of Public Works and Services on January 23, 2001. The department is divided into four ongoing activities: directorate, asset management, systems and communication, and petroleum products. The committee noted a $462,000 increase between the previous year and the 2001-2002 Main Estimates. The recent collective agreement with the UNW is projected to cost the department an additional $896,000 for the upcoming fiscal year. The committee also noted that the department plans to decrease the number of staff by eight.

Functional Audit

In its report "Review of the 2001-2004 Business Plans", the committee made a recommendation that a functional audit be performed upon the Department of Public Works and Services. Changes in government, which include community empowerment, privatization initiatives, user pay, aboriginal self-government, and the formation of Nunavut, have resulted in a new operating environment. The committee was of the opinion that it was time for government to review the present delivery of petroleum, oil and lubricants, capital purchases, records management and asset management programs.

Since the review of the business plans, the department proposes to add a senior policy advisor position to research the role and relationship of the department in regard to self-government and look at different models of service delivery. A questionnaire has been sent to clients in an effort to determine the "shape" the department will have to assume to reflect client needs. However, given all the changes in the operating environment, the committee feels this still falls short of what they wanted. The committee is of the opinion that it is time for the government or an outside agency, not the department, to review the Department of Public Works and Services to determine the best methods of delivery for services the department presently provides.

The committee recommends a functional audit be conducted to determine the best long-term delivery method for the services presently delivered by the Department of Public Works and Services.

Records Management

Also in the report Review of the 2001-2004 Business Plans, the committee recommended that the government revisit their overall approach to records management with a view to a more customer-oriented approach to suit individual departments.

To date, there has been no resolution to this issue. Departments do not feel they can conform to the Administrative Records Classification System (ARCS) that PWS wishes to implement. The committee understands the Knowledge Management Strategy will address records management and hopes that the strategy will suggest a resolution which can work for all departments.

Program and Functional Review Fee Increases

The committee notes that the department has incorporated into the main estimates, fee increases for electrical permits, boiler registrations, gas permits and elevator permits. These increases were first presented in the program and functional review. These fee increases result in an increase of $187,000 in revenues. The committee is concerned about the cumulative impact of fee increases on the residents of the Northwest Territories.

Vacant and Deleted Positions

Vacant Positions

The committee notes that salary dollars from vacant positions are being used to cover funding shortfalls in the department. As was highlighted in the Standing Committee on Accountability and Oversight's report, when positions are held vacant, programs and services suffer. Members feel that monies approved by the Legislative Assembly for salary purposes should be used for such.

Deleted Positions

The 2001-2004 Business Plans contained a list of changes in the staff positions for the department. There were nine positions deleted and one position added, resulting in a net effect of a reduction of eight positions. During the review of the main estimates, the committee observed that the net reduction of positions remained at eight.

However, upon questioning the department, the committee learned that the method to arrive at the eight deleted positions had changed. Now, the department will be deleting ten positions and adding two positions. Further to this, in comparing the list of deleted positions supplied in the business plans with the list supplied during the main estimates review, there have been changes in the positions to be deleted.

The committee requests that, as was the protocol in the 13th Legislative Assembly, Members of the Legislative Assembly be notified in writing of any deletions and additions of Government of the Northwest Territories positions in their riding.

PWS Water and Sewage Services Operating Agreements With Communities

The recent problems with drinking water quality in Fort McPherson has brought the issue of the department's water and sewage services operating agreements with communities to the forefront. In some operating agreements that presently exist, the municipality does not have the ability to have input respecting proposed costs before the costs are incurred on behalf of the community.

Essentially, as the agreement is worded, DPW can perform acts to carry out its responsibilities under the agreement, bill the community and the community has to pay, no questions asked.

Some of these agreements date back over 12 years and are not reflective of community empowerment initiatives. The Minister has stated that the department is open to renegotiating these agreements. The committee encourages the department to approach all communities with water and sewage services operating agreements and advise them that these agreements can be renegotiated. It would be in the best interest of the communities to review their contracts with DPW to prevent future incidents such as that which occurred in Fort McPherson.

Petroleum Products

Privatization Proposals

The Northwest Territories Power Corporation (NWTPC) has expressed interest in assuming responsibility for petroleum, oil and lubricant (POL) delivery in communities presently served by the GNWT. The Minister informed the committee that the department is accepting proposals for the privatization of POL delivery. However, Cabinet will not be awarding any contracts until the government has considered the recommendations arising from the NWTPC review.

The committee feels that this is unfair to individuals and groups that spend time and money developing their proposals in hopes of acquiring a contract to deliver fuel to a community when, depending on the recommendations from the review on NWTPC, that option may not be possible.

Misconceptions Regarding Privatization

The committee observed that there may be misconceptions when the term "privatization" is applied to POL. When POL delivery is privatized, the GNWT is not absolved of responsibilities. The government maintains ownership of POL assets and retains responsibility for the bulk delivery of fuel to some communities. Further, despite privatization, the government is still responsible for some environmental liabilities.