Members, for your information, the first hour-and-a-half of our session today will be interpreted in South Slavey.

Also, I would like to draw Members' attention to the gallery today. There is a very enthusiastic group of teachers, parents and chaperones up there from Grade 6 classes from Hay River. Welcome to the Legislative Assembly. I hope you enjoy the proceedings.

---Applause

Orders of the day. Item 2, Ministers' statements. The honourable Minister of Finance, Mr. Roland.

Thank you, Mr. Speaker. Mr. Speaker, I would like to take this opportunity to update Members and NWT residents on this government's fiscal position and outlook.

When I presented the budget in February, we were looking at a fairly positive fiscal situation, both in the short and long term. At that time, we forecast a 2004-05 year-end operating surplus of about $44 million, primarily the result of the increases to our formula funding grant and federal health transfers arising from last fall's First Ministers meetings.

Despite receiving these additional funds, our interim public accounts will show an $18 million deficit for the year 2004-05, as a result of retroactive changes to corporate income tax entitlements, along with booking a liability for the Giant Mine remediation.

The corporate tax changes relate to a refund to a company filing an amended corporate tax return for the 2000 tax year, claiming subsequent offsetting capital losses against previous income. This claim is expected to reduce GNWT corporate taxes by $36 million. Given that the federal government has been the primary beneficiary of previous large corporate income tax windfalls, we believe it is incumbent on Canada to compensate the GNWT for this lost revenue. If we receive a positive response to our claim to Canada, we will reflect this in an upward revenue adjustment on the grant side. At this time, however, our accounts must reflect the lower tax revenue.

The second issue relates to the conclusion of a cooperation agreement with Canada respecting the Giant Mine remediation project. This agreement means that we will be accruing a liability of $23 million to reflect the GNWT's share of the liability of this remediation. Approval for this expenditure will be sought in a supplementary appropriation.

These are both one-time events which will not affect future fiscal years' revenues or expenditures, although the reduction in CIT will have a temporary effect on tax revenues in the next few years as it works through the federal process of tax estimates and adjustments.

Mr. Speaker, on the positive side, our current outlook for the present fiscal year is only marginally lower than the February forecast.

We continue to face the same uncertainty, however, regarding our fiscal arrangements with Canada that I outlined in the budget. New rules for formula financing after 2005-06 will not be established until after the federal Expert Panel on Equalization and Territorial Formula Financing provides its recommendations. The panel is scheduled to report in late 2005. In addition, we are still discussing the terms of a resource revenue sharing arrangement with Canada and the Aboriginal Summit. Until these issues are resolved, we cannot predict with certainty our revenue levels or how economic growth will affect our fiscal situation.

There are many outstanding federal-territorial issues, in addition to formula financing and resource revenue sharing, which will affect our fiscal situation and our ability to pursue our goals. These include the need to deal with the social and economic impacts of development on our residents and our communities, the need to change the borrowing limit, the negotiation of federal gas tax funding for communities, and many more.

Mr. Speaker, our fiscal relationship with Canada is at a critical point. Canada must recognize that if we can make progress on these issues in ways that reflect the unique circumstances in which the Northwest Territories finds itself, we can make lasting changes that can permanently improve the quality of life for NWT residents and benefit Canada as a whole.

The revenue and expenditure changes I have just discussed today do not warrant change to our basic fiscal strategy. We will continue to pursue the fiscal responsibility policy I outlined in the budget in February. Our territory's economic prospects remain strong. The recent decision by De Beers to proceed with the Snap Lake diamond mine will support strong economic growth in 2005 and 2006. We remain optimistic that the Mackenzie gas project will proceed on schedule.

Mr. Speaker, we will continue to follow the path outlined in the budget. Thank you, Mr. Speaker.

---Applause

Thank you, Mr. Roland. Item 2, Ministers' statements. The honourable Minister of Industry, Tourism and Investment, Mr. Bell.

Thank you, Mr. Speaker. Mr. Speaker, I am pleased to provide the House with an update on the Mackenzie gas project. On April 27, 2005, Imperial Oil Limited, on behalf of the Mackenzie Gas Producers Group, announced a shift of attention from engineering studies to an increased focus on the pressing regulatory issues associated with the proposed Mackenzie gas project. The producers group also expressed the view that the economic demands in access and benefit negotiations were beyond the scope of what properly constitutes those agreements.

The producers group also made it clear that they expected the federal and territorial governments to address socioeconomic impact requirements along the pipeline route. Mr. Speaker, we are in the process of doing that. GNWT and aboriginal leaders have asked the federal government to provide funding to deal with socioeconomic needs in the Mackenzie Valley. We have received a commitment from the Deputy Prime Minister and other federal Ministers that they will provide funding to do this and we are now working to determine an appropriate amount.

Mr. Speaker, we have also taken steps to support communities in this process. The GNWT is sponsoring three regional social impact workshops in Fort Simpson, Norman Wells and Inuvik in late May and June.

---Applause

The workshops will allow residents to discuss socioeconomic concerns and help identify the best ways to deal with impacts.

Mr. Speaker, we are optimistic that the successful resolution of the socioeconomic issues surrounding this project will allow aboriginal organizations and the Mackenzie Gas Producers Group to work towards a successful conclusion of the access and benefit agreements.

While the proponents did defer some work on the project, the regulatory process continues and so do our efforts in this area. Through the Mackenzie Valley pipeline office, our departments are working together to identify impacts and solutions. The GNWT is also fully engaged in the regulatory review. Our departments are working together with both the National Energy Board and the Joint Review Panel processes to ensure the interests of the Northwest Territories are protected.

The GNWT also recently announced $1.3 million to help communities plan for the Mackenzie gas project. My colleague, the Minister of Municipal and Community Affairs, will provide the House with more details on this initiative later today.

Mr. Speaker, the GNWT has taken a number of important steps to facilitate the effective development of the Mackenzie gas project. We continue to believe the project will provide many positive benefits for the territory, but most importantly this project will benefit our residents and provide opportunities that would not otherwise exist. Thank you, Mr. Speaker.

---Applause

Thank you, Mr. Bell. Item 2, Ministers' statements. The honourable Minister of Municipal and Community Affairs, Mr. McLeod.

Mr. Speaker, community governments in the Mackenzie Valley are facing many challenges in preparing for the proposed Mackenzie gas pipeline project.

As well as getting ready for the complex review process involved with the project, community governments also need to plan for impacts that this project and the exploration and development activity associated with the pipeline will have on their communities.

Minister Bell and I heard this message loud and clear at the Preparing for the Pipeline Community Leaders Conference sponsored by the Department of Municipal and Community Affairs in Inuvik last December.

We heard this message again at regional workshops in the Deh Cho and during meetings with community leaders over the winter and spring.

In response to concerns raised by community governments and by Members of this Assembly, I am pleased to inform the Assembly that the Government of the Northwest Territories has recently approved new funding for community governments to prepare for the pipeline.

---Applause

Community governments will receive nearly $1.3 million this year to assist in assessing the impacts of the proposed pipeline, and to prepare strategies to maximize benefits and minimize any potential negative impacts.

The Department of Municipal and Community Affairs will provide $20,000 to 21 communities affected by the pipeline to assist in preparing their communities for the regulatory review process. To date, all but two of the eligible community governments have applied for this funding.

Further funding of up to $30,000 per community will be available to review proposals, assess impacts, negotiate community access agreements and undertake general planning and preparation. Community governments eligible to apply for this extra funding include the 21 affected communities and Yellowknife, which is an intervener in the review process.

Mr. Speaker, the Government of the Northwest Territories is of the view that all communities may experience some impacts from the project. Therefore, we have made up to $15,000 available to each of the remaining 11 community governments in the Northwest Territories to help them review, plan for, and assess any potential impacts or opportunities for their community as a result of the pipeline construction.

We have also secured funding for some essential support work. This work includes two more regional workshops planned for the Sahtu and the Beaufort-Delta regions, and funding to assist community governments to research and analyze common issues. This research and assistance may include engineering, infrastructure and legal research and advice.

Mr. Speaker, the Government of the Northwest Territories recognizes that community governments need support to better participate in the review of the environmental impact statement and the regulatory review process. Communities must be able to address capacity shortfalls that could result from the added workload associated with preparing for the pipeline. On behalf of my colleagues, I am pleased to announce that the government will provide this support. Thank you.

---Applause

Thank you, Mr. McLeod. Item 2, Ministers' statements. Members, before we go to the next item, I would like to inform Members that as well as South Slavey interpreters today, we also have Tlicho interpreters for the first hour-and-a-half.

---Applause

Item 3, Members' statements. The honourable Member for Sahtu, Mr. Yakeleya.

Thank you, Mr. Speaker. Mr. Speaker, we all know the devastating addiction problems we are having in the Northwest Territories. Addictions are ruining our communities and our homes. Alcohol is one of the worst addictions in our communities. With alcohol, we don't have to find someone to sell it to you. You don't have to search in back alleys, as it's always available in communities. In fact, in magazines and on television, they encourage you to buy it and buy a lot of it because they say it will make your life better and you will have more fun with it. Well, they couldn't be more wrong, Mr. Speaker. I may not be able to get all the alcohol banned from the Northwest Territories, but I would like to see overproof banned from our liquor stores.

Mr. Speaker, regular alcohol is 40 percent proof, but overproof alcohol can be as high as 160 percent. We shouldn't consider it a legal substance. Transport Canada has already labelled overpoof alcohol as a dangerous good. Why can't we do that with liquor in the Northwest Territories? When people get hold of overproof alcohol, they don't realize how dangerous it could be to them and their families. It's easier to smuggle into communities than beer or wine, which means people get addicted to the real hard substance. They build a tolerance to this level of alcohol and they need more and more to get high.

Alcohol is a controlled substance. We have the power to stop the overproof alcohol from being sold here in the Northwest Territories. Mr. Speaker, I want to ask the government to put into some sort of legislation that overproof alcohol will be prohibited from the Northwest Territories. Thank you.

---Applause

Thank you, Mr. Yakeleya. Item 3, Members' statements. The honourable Member for Nunakput, Mr. Pokiak.

Thank you, Mr. Speaker. Mr. Speaker, it's good to hear the Minister of MACA make a statement this morning with regard to the pipeline.

Mr. Speaker, since the announcement of Imperial Oil Limited, on behalf of the proponents of the Mackenzie gas project, to suspend future technical work along the Mackenzie Valley, there have been aboriginal groups, business people and people in general concern about the future of the proposed pipeline along the Mackenzie Valley.

Many people, Mr. Speaker, in the Beaufort-Delta are concerned and so they should be. Owners of small businesses are trying to decide whether to make any future investments to get ready for the pipeline in light of the uncertainty.

Mr. Speaker, some aboriginal groups consider this as a threat by Imperial Oil to have their own way, but let me tell this government we should not take this announcement as a threat but as a wake-up call for the federal government to respond to the concerns raised by our government and the aboriginal groups for funding to address the social and infrastructure needs of the Northwest Territories.

Mr. Speaker, I have worked for industry before and if we think Imperial Oil and their partners are just talking the talk, let me tell you they will pack up just like in the mid '70s and early '80s if the federal government does not respond to these concerns.

I have been to many meetings in the Beaufort-Delta, Mr. Speaker, representing both aboriginal groups and municipalities over the last 30 years. Many times issues such as lack of schools, community halls and roads in small communities were raised by individuals. Today, Mr. Speaker, these same issues are being raised by communities, in particular when proponents are in attendance. Communities always request industry to provide money for these infrastructure requirements. The industry's response has always been that it is the government's responsibility, and they continue to say that. This is where I agree that government must step up to the plate and address the needs and concerns of the communities.

Mr. Speaker, if the Mackenzie gas project does not become a reality or should be delayed, I will continue to be relying on the federal government for a handout. Mr. Speaker, I would like to request more time to finish my statement. Thank you.

Thank you, Mr. Pokiak. The Member is seeking unanimous consent to conclude his statement. Are there any nays? There are no nays. You may conclude your statement, Mr. Pokiak.

Thank you, Mr. Speaker. It is important that we have an agreement-in-principle for the resource

revenue for the diamond mines and petroleum projects should the pipeline become a reality.

In closing, Mr. Speaker, I urge this government to respond to the concerns raised by the aboriginal groups and municipalities and general public for the needed funds to address the social impacts and infrastructure needs of all the Northwest Territories' communities. Thank you, Mr. Speaker.

---Applause

Thank you, Mr. Pokiak. Item 3, Members' statements. The honourable Member for Tu Nedhe, Mr. Villeneuve.

Mahsi, Mr. Speaker. Mr. Speaker, today I rise to proudly mention some educational achievements within the NWT and, more specifically, within my constituency of Tu Nedhe.

I attended the Aurora College Thebacha Campus convocation on April 18th in Fort Smith last month to celebrate with and congratulate 11 of my constituents that have graduated from four different programs.

Mr. Speaker, I'd like to extend my congratulations to Eliza Beaulieu, Jennifer Beaulieu, Doris Catholique, Helen McCallum, Jill Rymer, Eva Villeneuve and Loretta Edjericon for the completion of the Home and Community Support Workers Certification Program.

I'd also like to congratulate Suzanne Boucher and Kara King for receiving their management studies certificates, and John Catholique of Lutselk'e for his achievement in attaining his diploma in social work.

And last, but not least, my congratulations go out to Carol-Ann Chaplin of Fort Resolution for receiving her management studies diploma. Ms. Chaplin is also the 2005 Aurora College class valedictorian for this special occasion.

Mr. Speaker, I want to express my sincere pride towards all these graduates of Tu Nedhe, and especially to Loretta Edjericon, who exemplifies the importance of determination and perseverance required to fulfill one's goals. As she is considered an elder in my community of Deninu Kue, she has definitely shown all who were present at the ceremonies that you are never too old to formally start educating your mind. There's an important message to all the students in the gallery.

With that, Mr. Speaker, I look forward to attending more celebrations of achievement by my constituents of Tu Nedhe, and I again say kudos to Loretta Edjericon on your achievements and congratulations to all the Tu Nedhe graduates of 2005. Mahsi, Mr. Speaker.

---Applause

Thank you, Mr. Villeneuve. Item 3, Members' statements. The honourable Member for Great Slave, Mr. Braden.

Thank you, Mr. Speaker. Part of our work here requires that we make tough decisions. Along with that responsibility and expectation, Mr. Speaker, comes the essential, the absolutely essential need in this House that we also have tough consultations to help make those decisions good ones that we can all accept and can all work with.

Mr. Speaker, in the matter of the relocation, the government now says done deal to move the Territorial Treatment Centre from Yellowknife to Hay River. We were denied that essential, that very essential expectation of coming to us and talking to us and helping us make sure that we have a hand in making decisions as difficult as this that affect the lives and careers of employees and families and children who are going to be disrupted in this.

Mr. Speaker, I'm going to continue to demand, on behalf of constituents, people here in Yellowknife, the families and the workers, that we are given this opportunity. Too often, Mr. Speaker, Members on this side of the House are treated casually, I would say sometimes disrespectfully, when it comes to getting our views on various actions; and then on the basis of only the most casual, cursory discussion, decisions are made. This is not how consensus government is going to succeed. In fact, it may be one of the things that causes its downfall, because this side of the Assembly has got to be able to represent our constituents as fully as possible and the government cannot decide arbitrarily to sidestep that.

I am going to continue, Mr. Speaker, to demand that that obligation be fulfilled on this matter and every other issue that comes along. When tough decisions are required, let's have those tough consultations. Thank you, Mr. Speaker.

---Applause

Thank you, Mr. Braden. Item 3, Members' statements. The honourable Member for Hay River South, Mrs. Groenewegen.

Thank you, Mr. Speaker. Mr. Speaker, yesterday I said that I wanted to follow up on more detail about the effects of the closure of the remand unit at the South Mackenzie Correctional Centre in Hay River. We knew that there would be a reduction in shifts available for casual employees. We knew that the number of indeterminate positions would be reduced by five if when they became vacant through attrition, and we knew that the projected savings of $400,000 was not realistic. What wasn't quantified was the consequential effects that weren't fully anticipated or wouldn't be realized until the actual change in operations took place. These are the ones which we are becoming more aware of now and they are the ones that I want to talk about today.

I was assured during the budget session that the holding and transporting of inmates was not going to negatively impact RCMP detachment budgets, and I didn't accept that then and now I'm starting to hear how this is playing out. In a detachment like Hay River, where cells might have normally been occupied for four or five days a month with the accompanying staffing on-call guards, now there's only four or five days a month when the cells at the RCMP detachment aren't being used for remanded persons in custody. There have been some recent arrests where there have been five people charged at one time around some well-publicized drug cases.

I've recently learned that these inmates being transferred on scheduled flights on commercial carriers, that there's a rule pertaining to their transportation, and that is being that one officer cannot be responsible for more than two prisoners. This is a good and understandable rule, but one that will cost the RCMP more money to transport inmates to and from Yellowknife. I don't believe that these additional costs paid for from detachment budgets are not going to affect the delivery of policing services at the community level, not to mention the fact that there is going to be a decreased presence of RCMP members in our community at any given time.

Another bit of feedback that has come in is how remand inmates being located in Yellowknife is affecting the JPs' court scheduling. JPs are being pressured to plan their schedules and disposition of charges and cases around the convenience of getting the accused back and forth to Yellowknife. Now, this is not a very good way to run a justice system.

Another impact of the remand closure, that I hope and pray this government doesn't have to face, has to do with safety of prisoners who may attempt self-destructive measures while incarcerated. The staffing...

Mrs. Groenewegen, your time for your Member's statement has expired.

Mr. Speaker, I would like to seek unanimous consent to conclude my statement. Thank you.

The honourable Member is seeking unanimous consent to conclude her statement. Are there any nays? There are no nays. You may conclude your statement, Mrs. Groenewegen.