Thank you. General comments. Next I have Mr. Menicoche.

Thank you, Mr. Chair. Just with respect to the Department of Public Works and Services, this department provides a lot of services to the communities I represent, as well as within Public Works and Services, we have the petroleum products division. Their headquarters is in Fort Simpson. People are very pleased that we do have that as a central office there. By far, the biggest concern that I have been hearing over the past year is, of course, the amount of fuel that people are getting in the communities. The biggest single concern is that fuel went in there last year but the price wasn't adjusted until July, so communities like Trout Lake and Nahanni Butte are saying, what's going on? You raised the price this year in July and you didn't bring us new fuel, because the Minister had always said we are adjusting it because new fuel is coming in. They are saying, well, it is July. We didn't get new fuel and yet you are raising the prices. The Minister indicated to the community that there was a delay factor in there but, again, in September, the ministry had to once again adjust the prices upwards. The fuel prices are still the same, so the communities are really concerned that they are paying, like in June, I think it was $1.40 per litre, which is one of the highest communities in the North right now.

The problem there is that the fuel prices everywhere in the North has stabilized and, in fact, has dropped in many other communities except those communities being provided service by our petroleum products division. I can appreciate that the ministry is getting stuck with stock, but there must be some way to be more flexible to provide our communities market pricing. I don't think it is fair at all that the communities would be stuck with paying $1.40 per litre only because one of the communities like Jean Marie, when the fuel price is at $1.40, they would be getting their fuel from other places like down the road, either Fort Simpson, Hay River or Inuvik, stock up with those fuel prices, so they will have a catch-22 there, Mr. Chair, where the product in that tank is not going to move at all. It is stuck at $1.40 and then some of the other criticism, too, about the fuel stock is that not all the stock in that tank was bought by the government at $1.40. If there was half a tank, does it mean that the full 2,000 litre tank gets charged out at $1.40? They are not exactly fuel specialists or financial wizards, these people in our communities, but they know that, if the tank is half full, you can't be charging full rates just because you put in 10 gallons. They see that and come to me saying there must be a better way of doing it. Either that or else you provide some kind of subsidy to community people, because a lot of the fuel is used for living off the land, like the community of Trout Lake which is...I don't know the word for it. I guess it is like landlocked. They are remote enough that, for half the year, things have to get flown in and out of there. So they are saying there must be a way in order to benefit us in world market pricing. I know that the ministry is going to be looking at it, but if the Minister can comment on what is a better way of doing that to make the prices reflective of the world.

I know that we have a petroleum products revolving fund. I don't know if we can use this and take advantage of that to provide lower prices to the communities. I really think, Mr. Chair, that we have to, as a government, take a hit and adjust those prices downward. That is what governments do. We take a hit sometimes just to level out the playing field. In fact, in this House, we talk about it quite often. It is through subsidies. This is one instance that we are going to have to do it. I am not too sure how many communities are serviced through the petroleum product department or how much of an impact it would be to drop all the prices down to, just to pick a figure, Mr. Chair, $1.00 per litre. I don't know how much of a hit we are going to take if we do that, but I don't see a way out of this, Mr. Chair, especially if the price is going to remain stable for the rest of the next six months anyways. That is all I can see. But yet our communities are stuck with these high prices. There is only one way to do it. We are going to have to take a hit there, Mr. Chair. I will leave that up with the Minister to consider and look and provide something back to our community.

Another concern that stems from my riding was a problem of procurement of office spaces. We have wonderful guidelines and procedures of how to give out contracts. Yet we had an instance in one of my communities where a contract really didn't...There was some question as to how it was handed out. I had a couple of enquiries saying, hey, I wasn't even put on the bidding list. I provide that service. Why am I left out? But the response of the department was rather neat. They are saying that business or those businesses didn't provide adequate type of services that we wanted. But, just the same, that is why we have a bidding process, Mr. Chair, that everybody should be entitled and offered an opportunity to bid and provide that service. At that point, then, once you have the bid in front of you, that is when you determine when a provider didn't have enough in their bid package or meet some type of minimum standard to provide their services. It is at that point that you make a determination. You don't make a determination beforehand. You have to give people the benefit of the doubt. I don't think it happened in this particular case. I have been in contact with the Minister's office with regard to this. He assured me that things were followed properly, yet there is still the perception that a step was missed, that there were some discrepancies with how that contract was awarded or given out. It was kind of like...While we are having this discussion, too, in the House, it is that whole area of negotiated contracts and what qualifies for it. In this case, I really didn't think that negotiated contract applied. Again, it is about offering our services to the general public and to the businesses out there, providing everybody equally in having a bid on the services that the government wants.

One further point that had caused great distress to the community, as well, is that jobs being provided in my region are one of the ways that we are stimulating economic development. One can argue that Nahendeh, my riding alone, is economically depressed. By providing jobs and decentralization, it is an injection of new money into our communities. One government job at a manager level is probably worth about $120,000 or more there, Mr. Chair. What happened in the last year, too, is that one of our jobs got transferred. I am not too sure about the reasoning too, and people back home are not very clear about the reason for transferring the position away from the regional office. Petroleum products are supposed to be a central office, but yet we moved that job over to Yellowknife and they are still quite concerned about that in the community because it is a lost job. It is a big thing. ITI did an ad and had been running it for some time about the story of the bouncing buck. So that is $100,000 or $120,000 that doesn't get to bounce around one iota in my community and in my region, Mr. Chair.

With that, I will be looking for some comments from the Minister. I will just end my opening statements.

Thank you, Mr. Menicoche. Mr. Roland.

Thank you, Mr. Chair. Mr. Chair, I will try to respond to all of the issues that Mr. Menicoche has raised.

First off, with the petroleum products division and the stabilization fund, we used to, when the Northwest Territories was part of Nunavut or Nunavut was a part of the Northwest Territories, have a $5 million stabilization fund. What we found after division occurred was that the economies of scale had dropped significantly for ourselves here in the Northwest Territories, and we were unable to carry that fund as it had a large debt. In fact, the previous government had already taken a hit by writing off a large portion of that debt. What also occurred at that time was to drop the stabilization fund from $5 million down to $1 million. So the impact of a plus or minus could quite quickly affect our ability to mitigate any increases in fuel prices across the territory. Since then, we have done a couple of other things. One is because of the old situation of trying to deal with price changes, it had to follow a process to go from the department after refuelling, reviewing, after the final refilling had been done in all the communities, then a paper would be brought forward to the Minister who would then carry that to FMB for any changes in prices. If there were questions about it, it would go back to the department for further clarity and then back to the table again. That could provide a delay of a few weeks to a few months at times, thereby delaying the impact of any changes plus or minus.

What we have done now is, with changes coming forward, FMB has given myself, as a Minister, the authority to make changes on it by notifying them of the change and then having it put in place so the timelines between changes can be significantly reduced to the changes. But what we found last summer, was the price of products across the country was going high extremely fast. We were just at the refuelling stage with barges and by road to a lot of our communities. As a result of the fuelling, we found that we had to make the increased prices effective when we were able to bring it forward to FMB.

One of the things that we have done to try to mitigate some of the prices on communities was we had an average of 10 cents a litre for home heating oil reduced. Instead of having the full impact of...Let's just use an example of $1.50 down to $1.40. That is on the high side. Home heating oil wasn't getting high in most communities. The price of gasoline was. But the subsidy we put in place of 10 cents average was to protect those in the communities.

The policy we face from petroleum products division, or from Public Works and Services, is one of full cost recovery. That decision was made as well in the last year that we had to recover the cost of the product delivered in the community. When we say full cost recovery, we are still not adding in a cost for capital replacement of our facilities, so that part is still not covered. What we are covering is actual delivery of the fuel product into the community, the contract we have with fuel delivery services and a bit of O and M levy within the department. Those are the things that we have to have full cost recovery for. Unfortunately, once the fuel is put into the facility in a community, we are charged that price when it is delivered. When it leaves the barge or the truck into those facilities, we are tacked with the price of that day. That is going to be the price until the next refuelling happens. What occurs is there are measurements. We know the quantities that are left in the tankage in those communities. From the previous year's refuelling to the existing season when the tanks are filled up again, there is an average of what is left in that tank, and it is blended with the new products. When we top up the tanks, not everybody is paying the new price per litre of the full tankage. It is blended, so there is a formula there to take into effect the amount of old fuel in there, the amount of new fuel that goes in, and blends within that area. Nobody is paying the full price of a tankage if it was one-third full and we topped it up with two-thirds new fuel that was more expensive. It is blended.

As well, one of the other things we did within Public Works and Services was reduce the O and M levy by two cents a litre on top of the 10 cent average decrease on home heating oil. That is one of the things we have available, but, beyond that, our policy that we have to work with is one of full cost recovery.

The other area that was discussed was office space procurement. Fort Simpson, specifically, the office space, as the Member stated, we did work with him on the area of concern that did come up. Our practice will be that we will be going out in that community for RFP for office space. It still won't help the individual unless the company that was in question builds office space that would fit the criteria. When the departments come to us requiring office space, they have a design and criteria of an office that they are requesting. We would go look in the communities to see who has that available. In the case that we initially dealt with, we felt that the other space that was available didn't meet the criteria that was established. But I made a commitment to the Member that, from this point on, it would be an RFP process. It might not change the future decisions of what is required, but it still would be open to all those that would have space available.

The issue of employment in communities is one that the government has dealt with on many occasions in this Assembly, about how we spend dollars, how we either have a centralized system, or we try to regionalize or put as many frontline positions in communities. I have

corresponded with the Member on the amount of positions that we have seen developed in the community. Within the last year, we have seen a significant growth trying to just deliver services in the community. That has been one of the factors. The specific one within Public Works and Services, and specifically within PPD, was the director position, or coordinator of fuel operations is the title of that position. We had put out for an ad to hire someone to fill that position. It was identified to go into the community of Fort Simpson. We had a successful individual who applied and initially took up office there. Unfortunately, due to a number of extenuating circumstances, he felt that he could not continue on in that community. We made a change in our structure to allow him to work out of Yellowknife. Because of the work that was going on was critical, we kept somebody in that position. Further to that, as we go through this budget, we will see within Public Works and Services another creation or position within the community of Fort Simpson. Thank you.

Thank you, Mr. Minister. Next on the list for general comments I have Mr. Braden.

Thank you, Madam Chair. Public Works and Services has a pivotal role to play in how we manage and, of course, pay for our facilities or buildings. With the skyrocketing price of energy of late, it is very much in fashion now, Madam Chair, to look not only at the base lease or construction costs of a given building or facility, but at the long-term O and M costs. How much over the life of a lease of a building, Madam Chair, will the government be paying to heat, light and ventilate a given structure? All of this will come back to haunt anyone who is paying to live or use a building if we really haven't paid very close attention to how we can incorporate good practice and policy when we make a decision on leasing a building and designing or refurbishing buildings.

Where I would like to go with this, Madam Chair, is to ask the Minister to what extent we are incorporating the O and M costs of our buildings in terms of making decisions about leases or getting involved in the design and the specing of our capital projects. I know that could be a very big and technical area, but one thing I am really interested in is just how much weight or significance do we put on those longer-term O and M costs versus, say, what a bottom line, square foot cost would be? Can we start there, Madam Chair? Thank you.

Thank you, Mr. Braden. Mr. Roland.

Thank you, Madam Chair. Madam Chair, the department does look at a number of factors when looking at the type of office space we look at. In fact, the type of buildings we are involved in constructing through project management with other departments, the Canadian Building Incentive Program is one of those that we've endorsed and are using as we look at new facilities. The area of leasing office space and what's included in the waiting of those percentages, I'll ask Mr. Aumond to respond to that as he's much more familiar with the technical, I guess, discussion that would flow from this. Thank you.

Thank you, Mr. Roland. Mr. Aumond.

Thank you, Mr. Aumond. Mr. Braden.

Madam Chair, something that I've learned about this aspect of government, we're a big tenant and a big landlord, and we've got to be paying attention to this. Something that I'm quite happy to pass on, Madam Chair, is a compliment and a credit to this department from some of the engineering and architectural firms in town. At a workshop a few weeks ago, we were talking about this aspect of collaboration and working how we can best look for the next generation of buildings and structures and getting things that work for both the tenant and are economical. I was told, Madam Chair, that Public Works and Services and the engineers and the folks there are, if anything, ahead of the curve in Canada for paying attention to this kind of thing. So that's something that I've heard and I don't mind passing on, but I'd sure like to keep this aspect of how we manage our facilities at the front, and I would ask the government if it has gone so far as to set any targets for energy consumption, energy management, energy reduction? We hear all sorts of talk about the need to conserve, the need to use energy wisely, but what are we doing to set some targets and measure our performance, Madam Chair?

Thank you, Mr. Braden. Mr. Roland.

Thank you, Madam Chair. Madam Chair, we've been working with the government overall on the aspects of energy efficiency and how we operate. I guess one of the areas that we look at, from the Public Works and Services side, is one where it is in that initial design of how we put new buildings into service and how we might upgrade when we do renovations and the codes that are out there right now. Again, the Canadian Building Incentive Program is one where we're putting to use, for example, within the Tulita school, the planning for a new courthouse, and the new schools in Inuvik, the replacement of those two facilities. So those plans are being incorporated upfront to ensure that, as building owners, we are getting the best value for our dollar being spent, and addressing those upfront would, in the long run, increase our efficiencies when it comes to paying out the dollars for that.

As well, we have in the budget upgrades for a couple of the local office spaces we have here, being the Laing Building and the Stuart Hodgson Building are the two areas that we've got work, as well, to increase energy efficiency. So those are happening on the big side. Of course, on the day-to-day process, when you go into many of our offices, we've already, through previous years, practiced and ongoing practices as either we get better or increased efficiency as the type of lighting we've

used, the fixtures, whether they shut off automatically. That type of area.

As well, I would just like to thank the Member for his positive comments around the news he's heard. Thank you.

Thank you, Mr. Roland. Mr. Braden.

Thank you, Madam Chair. So the question was really targets. Is it realistic to say look, you know, we're going to go for a two percent reduction in kilowatt hours or litres of fuel consumed? Are we able to focus on that kind of measurement and that kind of performance, Madam Chair? Thank you.

Thank you, Mr. Braden. Mr. Roland.

Thank you, Madam Chair. Madam Chair, as the Department of Public Works and Services, we haven't set a target to reduce by a two percent target our fuel consumption or kilowatt hours. What our goal is that what assets that we have available to us, or I guess increasing efficiency of products, is to just maximize what's available to us in the savings and that we go forward. As a government overall we are working, again, around efficiency and the cost of living in the Northwest Territories. We haven't gotten to that detail of trying to set actual targets of a percentage drop in that area or if it's a cost area of reducing by a certain number of dollars, but we've yet to do a fair bit of work in that area. Thank you.

Thank you, Mr. Roland. Mr. Braden, your time is up. Next on the list, I have Mr. Hawkins, general comments.

Thank you, Madam Chair. I think Mr. Braden actually captured some of my questions. I was concerned in the area of page 3 where the Minister had pointed out incorporating high energy-efficiency standards into our buildings, and I was going to follow up on the details of that, but is there a strategy...What's the buy-in strategy or what's the program to sort of make this a territorial policy because, from his perspective, it would be the lead department held by Public Works. I brought the matter up on a number of occasions, although it's caused the Minister to laugh when I've talked about switching the lights off, and his suggestion would be just to change the light bulbs from 100 to 60 watts or 40 watts, I can't remember, but I mean what is their strategy to become the role department through Public Works to be the model for other departments to follow? I'd like to hear on how he'd encapsulate that sort of positioning where his Department of Public Works will, yet again, lead the way on another matter and through energy efficiency recognizing these times that we now live in. Thank you.

Thank you, Mr. Hawkins. Mr. Roland.

Thank you, Madam Chair. Madam Chair, one of the first and probably most effective areas that we could and have worked in the past and will continue to work with those in the field in construction would be design standards. What would be incorporated in some of the designs for our buildings and, as well, make them available to all those that are in the construction industry as to what new products and systems may be in place to help reduce the cost of operating a building? So the most critical area that we would see in working with the private sector is design standards. Thank you.

Thank you, Mr. Roland. Mr. Hawkins.

Thank you, Madam Chair. Although I wasn't listening to Mr. Braden's questions, I will ask, and I apologize if it's been asked already. Has the Minister looked at, for example, dialling back the registers in our public works buildings or whatever seems applicable? You know, just like they have on television, those little advertisements about turning your heat registers down in the evening. Are we looking at those types of strategies, recognizing the cost of fuel, you know, if we can use our fuel and our power in an efficient way? Thank you.