Yes, Mr. Chairman. Mr. Chairman, I am pleased to provide you with an overview of the main estimates for the Department of Resources, Wildlife and Economic Development. For the 2002-2003 fiscal year, the department is requesting a total of $81,574,000. This request is an increase of $6 million or about eight percent.

Partnerships are an important mandate for this government. Our business plan focuses on supporting our partners in sectors such as tourism. The funding level that Resources, Wildlife and Economic Development provided Northwest Territories Arctic Tourism last year leveraged almost a million dollars with the Canadian Tourism Commission. It is our plan for this upcoming fiscal year to assist the NWTAT with obtaining these matching funds again.

There will also be a greater focus on broadening and expanding partnerships with communities in carrying out forest management activities. These activities will be conducted in partnership with aboriginal governments and communities with the objective of creating capacity at the community level and ensuring the direct involvement of aboriginal people in the management of forest resources.

One of the goals of this government is to ensure a balance. This balance includes economic diversification. We plan to enhance our efforts to create opportunities in the traditional economy, arts and crafts and cultural tourism sectors, which are especially appropriate for the smaller communities.

Fur markets are improving, traditional crafts are in demand and the private sector, especially tourism, is seeking ways to build links to the traditional economy. The department is fully engaged in responding to this renewal having completed internal reviews on how we manage the marketing of Northwest Territories fur and provide support to harvesters. As a result of the work carried out by the department, Northwest Territories trappers realized excellent results at the recent auction held in North Bay. We also had success with our northern fur garments featured at a reception hosted by our government during a Team Canada Tour in Texas and most recently in Munich, Germany.

Another area of focus is environmental protection. It is important that we maintain the appropriate balance between developing our abundant natural resources and ensuring the high quality of our land, air and water for future generations. In 2002-2003, we plan to continue to provide programs and services that integrate both resource development and resource management. The following are a few examples:

• • Continued implementation of the Protected Areas Strategy;
• • Developing a database to make informed decisions relating to Mackenzie Valley resource development. The department is proposing a biophysical study of the western Northwest Territories be developed through a partnership with industry, federal government, communities and environmental organizations;
• • Implementing the northern strategy to control greenhouse gases;
• • Bringing forward a proposal for a waste reduction and recycling program, including the recycling of beverage containers; and
• • An Elder's workshop on climate change is planned for this year.

Capacity Building

The third priority the department is focusing on is maximizing benefits to Northwest Territories residents and businesses from resource development. The Mackenzie Valley Development Project remains a key initiative for the department.

Through this project, the department will continue to provide on-going support to the Mackenzie Valley Aboriginal Pipeline Corporation (MVAPC). The Corporation and the Mackenzie Delta Producers Group have announced that they are proceeding with the preparation of a pipeline application. It is expected that a preliminary information package will be submitted during the second quarter of 2002 to the appropriate regulatory agencies, with a full application by mid-year 2003. Current projections are for natural gas to flow by 2008.

Through the Maximizing Northern Employment Program this past year the department, in conjunction with Education, Culture and Employment, supported 31 on-the-job training projects in the private and aboriginal sectors, which resulted in over 200 people receiving training in approximately ten communities. This coming year, the department is proposing to again work with these partners to ensure a maximum number of workplaces are providing training opportunities for Northerners. A special emphasis will be placed on a longer term training strategy for professional and technical positions this coming year.

Investing In Our Future

Finally, the Department of Resources, Wildlife and Economic Development is focused on the goal of building on investments. I would like to quickly review some of the activities the department has planned in supporting the business community of the Northwest Territories.

The department continues its support for the value-added diamond industry. The Government of the Northwest Territories' new certification and monitoring program is capitalizing on the growing interest in northern diamonds. The department, in partnership with northern manufacturers, is implementing a marketing strategy to complement the monitoring and certification program. This initiative will help position Northwest Territories mined and manufactured Canadian Arctic Diamonds as quality northern products in the competitive diamond market place.

The department is preparing a plan to implement the recommendations from the business program review based on results of consultation on the report. The goal is to provide single window access and improved delivery of business assistance programs. Additionally, in order to improve access to capital for northern businesses, we are working with the Department of Finance to host the first meeting of a Bankers Commission in March.

The objectives of the Northwest Territories Development Corporation are to promote economic diversification, stimulate growth of businesses and create employment, primarily in small communities. Over the past two years, the board of directors has been reviewing its subsidiary operations and taking action for improving these and strengthening its venture partner portfolio.

Conclusion

Thank you for allowing me to provide this overview of the programs and initiatives the department is undertaking. The key to our success will be partnerships, sustainable development, economic diversification and fiscal self-reliance. Mahsi.

Thank you, Mr. Chairman. The Department of Resources, Wildlife and Economic Development has the mandate to promote economic self-sufficiency through the sustainable development of natural resources and to enhance the creation of sustainable opportunities in the traditional and wage economies. It is also responsible for the promotion of sustainable development through the management and protection of the quality, diversity and abundance of natural resources and the integrity of the environment.

The Standing Committee on Governance and Economic Development met with the Minister of Resources, Wildlife and Economic Development and his staff on January 21, 2002, to review the department's draft Main Estimates for 2002-2003.

Committee members noted a $1,098,000 projected increase in operations expenditures from the 2002-2005 business plans. This increase is largely due to $765,000 in approved strategies and priorities, as well as an increase of $172,000 due to forced growth; a decrease of $11,000 due to amortization and an increase of $172,000 in other FMB approvals. The department did not propose any additional expenditures to its capital from its business plan.

The committee noted that the original plan to amalgamate the business development programs was introduced during the business plan process of October 2000 and implementation was planned for the fiscal year 2002-2003.

During the review of the 2002-2005 business plan for RWED, the committee was informed that the department had extended its period for public consultation and input until the end of January 2002. The committee was also informed that amalgamation would not be implemented until 2003-2004.

The committee felt that the re-organization of business programs and loans into a one-stop shop corporation should be put in place sooner rather than later in order for entrepreneurs to take advantage of the current economic boom in the NWT. The department responded that a legislative proposal would be coming forward shortly to amend the necessary acts.

The committee would like assurance that regional positions will not be reduced nor will service delivery in communities be negatively impacted by changes to business support programs. The Minister stated that there was no intent to alter present service delivery in the communities.

The committee looks forward to having one business support organization to ensure equal funding for businesses throughout the NWT. The committee is concerned that not all communities have equal access to Community Futures and other business development funding. A response to the recommendations made by the Business Program Review Committee has been provided by the standing committee to the department. The committee looks forward to having further input once the draft amalgamation policy has been provided.

The committee commented that the development of a new Business Incentive Policy has been under review for some time now. The committee recognizes that the current system does not adequately ensure that northern businesses benefit from northern contracts. The committee encourages the department to bring the draft Business Incentive Policy to the committee for review as soon as possible.

The Standing Committee on Governance and Economic Development is extremely concerned that development on NWT land is going forward without the establishment of a complete timber inventory despite the government's statements over the past six years.Honourable Stephen Kakfwi -- "The Department of Renewable Resources is planning to do a comprehensive inventory of timber in the Western Arctic. Hopefully, the inventory will be done over a two or three-year period."

(Northwest Territories Hansard, May 3, 1996, p.183)

Honourable Joe Handley -- "We are going to try to identify extra dollars to be able to put into forest inventory. Up until now, we have been playing catch-up with trying to keep ahead of the ongoing needs for inventory. It is possible that within five years we could have a complete inventory of all commercial forest in the territories, but I would think it would take at least that long."

(Northwest Territories Hansard, March 2, 1998, p.1221)

Honourable Stephen Kakfwi - " We have probably just a very rough guess at what the market value of the forest inventory up and down the Mackenzie Valley is."

(Northwest Territories Hansard, April 29, 1999, p.449) Honourable Joe Handley -- "Mr. Chairman, I would estimate that it will take us three to five years to get caught up in the Deh Cho. If you look at the whole Mackenzie Valley, we are probably in the neighbourhood of ten years behind. As Mr. McLeod has mentioned, given the interest in the harvesting activity, we will give this a priority."

(Northwest Territories Hansard, June 27, 2000, p.207)

Honourable Joe Handley -- "We do inventory on an ongoing basis in various regions of the territories so it is an ongoing process that is at different stages in different regions. In the South Slave, the Member's area, we are looking at a four or five-year process. We are basically at year one right now."

(Northwest Territories Hansard, November 6, 2001, p.673)

The standing committee notes that despite this current lack of a complete timber inventory for the Northwest Territories, timber permits are still being issued. It is the committee's assertion that the issuance of all timber permits should be suspended until timber inventories have been completed. The government must assure residents of the NWT that environmental protection is their first priority.

The committee is also disappointed to see that despite considerable funding over the past decade to complete a timber inventory, the government stated last year that we are now back at year one for completion. The committee has requested information from the department regarding the levels of funding for timber inventory over the past ten years.

If, as the committee suspects, the government is waiting for current outstanding land claims to be settled then it should publicly state that fact rather than consistently avoiding completion of the timber inventory.

However, if the government simply lacks the sufficient regulations to exert their responsibilities in this area, the committee would like to strongly suggest that the government rectify the situation and move forward with this project.

The committee will continue to monitor this pressing need for a complete timber inventory in light of the current development boom in the NWT.

The committee at the appropriate time will be making a recommendation. Given the historical nature of this problem, the Standing Committee on Governance and Economic Development recommends that the government complete a timber inventory by 2003-2004.

During its review of fire suppression issues, the committee noted that as members of suppression crews reach retirement age they are encouraged to retire, relying on their pension payments. However, the committee was informed that it takes four years of suppression work to achieve one year of pension. Members of the committee reported that there are now several cases of former suppression crew members having to rely on income support as their pension plans are not enough to support them. The department committed to looking at that problem.

The committee noted that the department is in the process of instituting a new fire protection process for communities and does not appear to be continuing the previous system of building fire breaks in high-risk communities. The committee would like to understand why the department appears to now be abandoning the fire breaks plan after promoting it vigorously for numerous years.

Honourable Stephen Kakfwi -- "This year about $750,000 in funding has been provided to projects in 11 communities.... As well, several communities have begun developing long-term plans to incorporate habitat and forest management objectives into community protection needs."

(Northwest Territories Hansard, October 3,1996, p.832)

The committee would like to know if the fire breaks program is continuing and if so, how many communities were able to complete their community's firebreak. The committee notes that the protection plan for the department appears to have changed from the building of fire breaks to the development of community protection plans. A sudden shift of strategy means that the valuable work from the past may be abandoned while the department has to develop a new strategy involving more expenditures. Continuity of plans and strategies within the department is important to ensure territory-wide coverage of fire protection for communities in the NWT.

The committee is also disappointed to see that despite this new process to develop some sort of community protection plan, as of yet, no community appears to have one. The committee feels strongly that communities may not be safe without these plans in place.

After questioning by the committee, the department agreed to a thorough review of forest management issues. The committee encourages the department to complete this review in a timely manner and looks forward to reviewing the results.

The committee remains concerned about the lack of an agricultural policy for the territories. The committee urges the department to develop a policy for this industry as they have for other sectors in the NWT.

A committee member also pointed out the lack of funding for fishing and agricultural industries in comparison to the funding provided for hunting and trapping industries. The department committed to providing an analysis to the committee on funding for the relevant resources. The committee looks forward to reviewing this analysis.

While the commercial fishing freight subsidy has been in place for a number of years, the committee noted that only commercial fisheries in Great Slave Lake have been able to access this subsidy. The committee asked that the department review the use of this subsidy and the possible expansion of the program to include other commercial fishing operations. The committee also suggested that there are inland lakes that may be able to sustain commercial fishery and urged the department to look at the issue. A member raised the issue of the control of wildlife within municipal boundaries. While communities will routinely call the local resource officer to handle "problem" wildlife, there does not appear to be consistency to the way in which the animal is handled. While some officers may attempt to trap the animal, others prefer to simply monitor it until it leaves the area.

During the discussion with the department, the Minister stated that there was no departmental policy regarding the control of wildlife within municipal boundaries. The committee is concerned that without a clear policy residents of communities may be at risk from "problem" wildlife. The committee urged the department to develop an overall policy on this issue.

A member of the committee raised concern about the health of Dall sheep in the NWT. The department informed the committee that the North American Wild Game Foundation, in co-operation with the department, completed a study of the Dall Sheep last year. The department offered to provide this report to the committee.

The committee was pleased to see that the Premier, in his address to the people of the Northwest Territories on January 11th, 2002, stated, "We will continue to work: to expand community and regional capacity to manage and monitor the environment..."

The committee is concerned that the majority of environmental monitoring of lands outside municipalities is left to the responsibility of the federal government. There is a feeling that the GNWT should be playing a larger role in monitoring environmental concerns in the NWT. The committee would like to be able to assure residents of the NWT that the federal government is living up to its responsibilities.

The committee noted the lack of an EDA such as the Western Economic Diversification Fund or the Atlantic Opportunities Fund.

Federal economic development funds directed to a certain region target the needs and specific economic concerns of that area. It is the committee's position that an Economic Development Agreement for the NWT would support the considerable investments required for continued economic growth.

The committee encourages the government to actively pursue federal funding through an initiative of this sort.

The committee has become aware that there are now a number of companies expressing interest in pipeline development along the Mackenzie Valley. The committee felt that the GNWT might be limiting itself in opportunities for discussions with other groups by focussing its attention on one proposal.

The committee urges the government to leave all options open in order to ensure the development of a pipeline proposal with the best possible rewards for the residents of the NWT.

Once again, the committee must point out that the government appears to have lost its focus and purpose on the regional reorganization initiative announced in 2000. During the review of the 2000-2001 Main Estimates the committee was told that responsibility for this initiative has now shifted to a ministerial committee.

The committee simply restates its statement from the last Main Estimates review. The committee urges the government to reassess their need for regional reorganization and, if it still exists, redefine and review this initiative.

(Report on the Review of the 2001-2002 Main Estimates by the Standing Committee of Governance and Economic Development, p. 5)

The committee has concerns regarding the representation of the department in the regions. During the discussion about regional reorganization the need for a new North Slave Dogrib region was raised. The Minister committed to a review of the issue.

The department informed the committee that RWED, along with the Department of Education, Culture and Employment, participated in on-the-job training for private companies through the new MNE initiative (maximizing northern employment). The committee is hopeful that training opportunities and student graduate hiring offered through the MNE will increase full-time permanent northern resident employment in the NWT. However, the committee also wishes to ensure that northern businesses are the first to benefit from this new program.

The committee asked if there was a policy or written guideline stating that northern businesses would receive first priority for programs under MNE such as the private business development program which provides funds for businesses to hire and train northern employees. The department stated that there are no formal guidelines and that local offices made decisions.

The committee would like to see a formal process that places preference for northern companies over southern firms in applications for MNE funding. The standing committee is of the opinion that northern residents should be the first to be trained under this program to promote a northern workforce.

During the review of departmental business plans and Main Estimates in May of 2000, the then Minister of RWED, Mr. Handley, informed the committee that the department had added three new regional petroleum advisor positions for the Sahtu, Inuvik and the Deh Cho region.

The committee is concerned that despite this promise to provide regional oil and gas experts, to date some communities do not have this help and are at a distinct disadvantage during crucial negotiations with oil and gas companies.

The department agreed that empty positions do indeed need to be filled as soon as possible and promised to review the situation. During questioning, the Minister suggested that groups that had spent their own money attempting to negotiate with companies could request compensation from the Government of the Northwest Territories.

The committee would also like to see a clear outline of how all the advisory groups and regulatory bodies coordinate their work and would link up with regional oil and gas specialists. Bodies such as the Mackenzie Valley Development Group and the Economic Development Advisory Forum under the auspices of the Intergovernmental Forum, as well as the numerous regulatory bodies connected with various government bodies, need to have constant communication with regions to share information.

The committee looks forward to hearing more information about the work of various groups involved in economic development of the NWT.

During the review of the Main Estimates the committee was informed that RWED once again has numerous vacancies -- 73 for this year. This committee has previously raised concern about the number of vacancies within RWED's department. While the committee recognizes that some of those vacancies are seasonal, others are not and require the hiring of casuals and contract workers to fulfil those necessary roles. The department informed the committee that it currently has 39 casual positions for this fiscal year. The committee would like to see these positions filled with permanent staff to ensure that necessary programs are being provided.

The committee also remains concerned about the department's admission that funds saved from vacancies are indeed being used for program funding. The department stated that there have been cases where some money does get transferred, but the funds pretty much stay in the same program area.

The committee is not reassured by the department's statement that the money is "pretty much" kept within the relevant division. The committee would prefer to see vacancies filled and program funding within divisions maintained at a planned and consistent level.

Committee members discussed the possibility of allowing the lapse of funding for vacant positions. The government could then reapply for funding for the next fiscal year when additional staff is hired to fill vacant positions. The committee will continue to monitor this situation and recommend changes to address this continuing problem.

Mr. Chairman, that concludes the Governance and Economic Development Committee's review report on the Department of Resources, Wildlife and Economic Development. Thank you.

Yes, I have witnesses.

Agreed.

Thank you, Mr. Chairman. Mr. Chairman, to my left I have the deputy minister of Resources, Wildlife and Economic Development, Mr. Bob McLeod. To my immediate right is Mr. Jim Kennedy, the director of corporate services. To my far right is Mr. Fred Koe, the president of the Northwest Territories Development Corporation. Thank you.