We will commence with that after lunch. Thank you.

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I would like to call Committee of the Whole back to order. We are going to now consider the Department of Executive. I would like to ask Premier Handley if he would like to deliver his opening comments. Mr. Handley.

Thank you, Madam Chair. I am pleased to present the 2006-2007 Main Estimates for the Department of the Executive.

The 2005-2006 Main Estimates have been restated from $8.946 million to $10.423 million. The difference is due to three main adjustments: the transfer of the responsibility for devolution and resource revenue sharing negotiations from the Ministry of Aboriginal Affairs; the transfer of the Bureau of Statistics from the Department of Finance; and the transfer of Intergovernmental Affairs to the Ministry of Aboriginal Affairs.

The transfers were part of a broader reorganization plan to improve the effectiveness of coordination of government. As a critical priority for this government, the responsibilities for devolution were transferred to the Executive to facilitate the interdepartmental coordination that will be of the utmost importance over the next year to ensure that the best deal for the Northwest Territories is realized.

The strategic planning branch will provide strategic advice on maters that have government-wide implications, help update and implement the government's strategic plan and ensure that we have current, consistent and accurate statistical information.

For 2006-2007, the Department of Executive is requesting a budget of $13.197 million, which represents a 26.62 percent, or $2.774 million, increase from the restated 2005-2006 Main Estimates.

Improving Planning And Coordination In Government

Following advice from Members of the House as well as local and regional leaders, the Executive is leading an initiative to improve planning and coordinating functions of government in order to provide for more efficient and effective delivery of government services to the public.

This initiative, which has been developed in consultation with committees of the Legislative Assembly, includes improving our government's regional operations. Given the economic, political and social changes in our communities, we must ensure our government, and the programs and services we provide, are easily accessible to the public. To assist in this goal, our government is proposing the creation of five new regional superintendent positions.

To fulfill its mandate to provide improved planning and coordination in government, the Executive is asking for new funding in the amount of $2.182 million.

Other Increases - Forced Growth

The Executive is also requesting approval for the $754,000 in forced growth increases as follows:

• • $546,000 related to the salary increases resulting from the Collective Agreement,
• • $25,000 for other O and M forced growth increases, and
• • $55,000 related to the extension of devolution and resource revenue sharing negotiations.

It is important the Commissioner's office has the resources to do the job effectively. It is proposed than an increase of $100,000 be made for the improved administration and operation of the Commissioner's office.

The Executive is also requesting $28,000 in increased core funding to the Status of Women Council and the Native Women's Association as a result of increased compensation and benefits requirements consistent with those offered to the public service.

Other Initiatives

Finally, the Executive is seeking an increase of $150,000 for a grant-in-kind for band council subsidized office leases in the communities of Tulita, Fort McPherson, Fort Resolution, Fort Providence and Deline. This is a non-cash requirement and will be offset by a similar increase to grant-in-kind revenue in the Department of Public Works and Services.

Madam Chair, I am now prepared to answer any questions committee members may have. Thank you. Mahsi cho.

Thank you, Premier Handley. At this time, I would like to ask the deputy chair of the Standing Committee on Accountability and Oversight, Mr. Robert Hawkins, if you would please read the committee's response to the main estimates for the Department of Executive. Mr. Hawkins.

Members of the Accountability and Oversight committee had an opportunity to meet with the Premier on September 20, 2005, to review the draft business plan for the Department of the Executive.

Members also received a briefing from the Minister of Finance on January 17, 2006, outlining the changes to the budget for the Executive since the committee reviewed the draft business plan in September.

Committee members made note that the department is proposing to spend $13.197 million in operations expense for the fiscal year 2006-2007.

Committee members offer the following comments on issues arising out of the review of the 2006-2007 Draft Main Estimates and budget-planning cycle.

Socio-Economic Impact Fund

On July 18, 2005, the Government of Canada announced their intent to establish a $500 million socio-economic impact fund to mitigate the impacts of the Mackenzie gas project on communities located along the proposed pipeline route. This fund came about as a result of a collaborative effort between regional aboriginal leaders and the GNWT to encourage the federal government to acknowledge the costs, both social and economic, that NWT communities face as a result of the pipeline construction.

The 2006-2007 budget includes funding for a new senior advisor position to coordinate GNWT involvement with the socio-economic impact fund. The standing committee has significant concerns about the socio-economic impact fund and does not support the new position at this time.

The committee believes it is premature to propose this position in the 2006-2007 Draft Main Estimates. Although the fund was announced in July, federal legislation to enable the money to flow was not passed prior to dissolution of Parliament. There is no guarantee that the new Conservative government will follow through with this agreement. In response to questions put to the Conservative Party about its support for the fund and its willingness to pass the necessary legislation as quickly as possible, the Conservative leader declared support for "the general principles and objectives of the socio-economic impact fund." Members are not convinced that enabling legislation will be passed imminently. So although Members see merit in the GNWT having a seat at the table that would see the fund distributed, they see no urgency and, therefore, recommend that government refrain from creating a socio-economic impact senior advisor position until such time as there is parliamentary assurance.

The committee is also opposed to the GNWT taking on administrative costs to oversee the allocation of the SIF and certainly does not support funding a new position to coordinate GNWT involvement in that context. It is the committee's position that all administrative costs should be borne by the federal government and included in the Socio-Economic Impact Fund Agreement.

When, and if, the SIF goes ahead, it will not flow through the Government of the Northwest Territories. Nonetheless, Members agree with the government that it is in the interest of NWT residents for the GNWT to be at the table. The GNWT has an important role to assist with the coordination and effective use of all funding intended to mitigate the negative impacts of development, irrespective of its source. The GNWT also has a level of expertise to lend to the process.

However, the committee feels very strongly that the case could and should be made to the federal government that the SIF must include a contribution to the GNWT for reasonable administrative costs. The fund is ample enough that the committee sees no reason it add a financial burden to the GNWT.

Finally, committee believes it is excessive to create a position that will exclusively oversee one single federal fund, especially since funding will not flow through the GNWT. Members see this as inefficient use of scarce resources. The GNWT is faced with fiscal restraint. Legislators are being forced to make difficult decisions about how to best use scarce resources. Managers are being asked to make do with less. The creation of this position, as presented in the 2006-2007 Draft Main Estimates, is not acceptable. The work could be done by current GNWT employees. The GNWT already has eight staff at the Mackenzie Valley pipeline office in Hay River, whose mandate is to focus on government-wide coordination, planning and strategy formulation, to maximize the benefits and to mitigate the adverse impacts of the development of the proposed Mackenzie gas project. Moreover, the 2006-2007 Draft Main Estimates proposes four new regional superintendents for the Department of the Executive. Committee members consider these new positions well placed to be the local liaison between the GNWT and the regions on the SIF rollout.

Recommendation

The Standing Committee on Accountability and Oversight recommends that the government delete the proposed socio-economic impact fund senior advisor position.

Extraordinary Funding Initiatives And Impacts On GNWT Responsibilities

The Standing Committee on Accountability and Oversight, along with counterparts on the Standing Committee on Governance and Economic Development, notes that there are an increasing number of new or extraordinary funds becoming available to regions and communities for a variety of programs and projects, worth a considerable sum of money. The SIF is worth $500 million over 10 years. The federal gas tax will flow $37.5 million to community governments for new infrastructure funding over a five-year period beginning in 2005. The municipal and rural infrastructure fund will provide joint federal-territorial community infrastructure funding of $32 million over five years, $16 million from the federal government and $16 million from the GNWT, while tax-based communities are expected to contribute another $7 million. The community capacity building initiative includes $35 million to communities, as a result of the Northern Strategy agreement.

Irrespective of the source of the funds, or their criteria, communities' decisions to make use the funds available to them will impact upon the responsibilities and priorities of the GNWT. As communities and regions begin to access these funds, identify their priorities and move forward with projects, the committee perceives a need for the GNWT to

have a clear position on how the choices made by the communities will affect GNWT responsibilities.

Rather than creating a new position exclusively to oversee the SIF, the committee suggests it would be a better use of resources for the new regional superintendents of the Executive to coordinate all extraordinary funds, to ensure there are no competing interests, duplication or downloading of responsibilities.

Resource Development Impacts

The Standing Committee on Accountability and Oversight takes very seriously the responsibility of the GNWT to ensure that all residents of the NWT are prepared to take advantage of opportunities presented by economic development, and that adverse social impacts of development are mitigated in all communities. The committee is concerned that the socio-economic impact fund only addresses the needs of regions directly along the proposed pipeline route. Committee points out that the impacts of large-scale development are felt throughout the territory, including smaller communities that are not directly on the proposed route. The same is true of the larger centres: Hay River, Fort Smith and Yellowknife. Committee urgently reminds the GNWT of its responsibility to all NWT communities.

Coordinating Role For Government-Wide Initiatives

During the review of the 2006-2009 Draft Business Plan, the Standing Committee on Accountability and Oversight noted that the Department of the Executive was taking on increasing responsibility for coordinating government-wide initiatives. The committee suggested it would be preferable that the department whose mandate makes them best suited takes lead responsibility to coordinate initiatives that involve more than one department. For example, the committee recommended that MACA would be better suited to take the lead for Canada Games 2007, because of its mandate for sports and recreation. Similarly, the responsibility for International Polar Year should rest with a department with expertise in the area of research and the environment, for example, the Department of Energy and Natural Resources.

The committee recommended that the Executive review its coordinating role in government-wide initiatives very carefully and consider if a program department with expertise specific to the initiative could take the lead for inter-departmental coordination.

At the root of the recommendation was the concern that as government units that provide services to government, such as the Executive, take on increasing responsibility, there is need for additional resources. The cost of government administration is growing at an alarming rate and the committee sees a need to be cautious. As legislators, we must ensure that any new central administrative initiatives, such as the coordination of a government-wide initiative, are looked at very critically to consider if there are already existing resources available to take the lead.

Since that time, the government has embarked on an initiative to improve planning and coordination in government. Committee is generally pleased with the initiative to date. However, as this work moves ahead, committee members caution the government that unwarranted administrative growth will not be supported.

Duplication Of Mandates And Activities - Executive And The Ministry Of Aboriginal Affairs

The Standing Committee on Accountability and Oversight has been concerned for some time now about the duplication of mandates and activities of the Ministry of Aboriginal Affairs and the Department of the Executive, particularly the office of intergovernmental affairs and strategic planning. One year ago, during the review of the 2005-2006 Draft Main Estimates, the committee recommended that the Premier undertake an internal review of the two departments to identify where duplication exists and to come forward with options to address this.

The committee acknowledges that considerable work has been initiated to improve the planning and coordinating functions of government, including the plan to move the intergovernmental functions from the Executive into the Ministry of Aboriginal Affairs. The committee supports this organizational change and hopes that this will lead to increased efficiency and effectiveness in government-to-government negotiations. While implementing this initiative, the committee again urges the government to keep in mind there is a need to keep public service growth in check.

Finally, some Members caution that as we move forward to a new era of intergovernmental relationships in a self-government political environment, the significant relationship between the GNWT and aboriginal governments must continue to be reflected in the GNWT structure. Madam Chair, that's all I have at this time.

Thank you, Mr. Hawkins. I will ask Premier Handley if he would like to bring witnesses to the table.

Yes, I would, Madam Chair. Thank you.

Thank you, Premier Handley. Is committee agreed?

I will ask the Sergeant-at-Arms if he would please escort the witnesses to the table and we will commence with the Department of Executive.

Premier Handley, for the record, could you please introduce your delegation?

Thank you, Madam Chair. With me are Bob McLeod, deputy minister for the Executive; and, Carl Bird, director of corporate services for the Executive. Thank you.

Thank you, Premier Handley. I will now ask the Members if they have any general comments. Mr. Ramsay.

Thank you, Madam Chair. I would like to welcome the Premier and his staff here with us this afternoon. General comments on the Department of Executive. I would like to first start off with this SIF position, the new position that is proposed. I sound like a broken record again, but I have mentioned this a number of times. This strategic investment by the federal government, the $500 million over 10 years earmarked for

communities along the pipeline route doesn't do anything for 70 percent of the population of the Northwest Territories, and those are the people who live in Yellowknife, Hay River, and Fort Smith. If we want to continue to call ourselves a public government and a true public government, I don't think we would have let that happen. Again, I don't want to say that the communities don't deserve the $500 million. They deserve that and then some. What I am getting at is impacts from resource development are going to happen in the population centres, Yellowknife, Hay River and Fort Smith. I lived through the resource activity here in the past 10 years with the diamond mines that have opened up north of Yellowknife. Most certainly, all you have to do is walk downtown Yellowknife and you can notice the change. The dynamic is completely different now than it was 10 or 12 years ago prior to a diamond mine opening on our back door.

In looking at resource development, who is going to help out the city of Yellowknife, or the town of Hay River, or Fort Smith, for that matter? We have to try...that is obviously why we need a resource revenue deal and devolution and more control from Ottawa. I am very much looking forward to that day; but in the interim, I don't see how we can manage without that. I don't understand the necessity for this position, the SIF position. To me, it makes absolutely no sense. The Government of the Northwest Territories is not going to administer the $500 million. It is going right over top of our heads directly to the communities. We are not going to see 10 cents of that money flow through the Government of the Northwest Territories. I am of the opinion that a firm guideline or policy that is put in place to communities on how this money can be spent is all that is needed. We don't need to hire somebody to give us a policy or some guidelines. I will leave that one there.

The other thing I wanted to mention as I find it really interesting how the Executive is requesting $28,000 in increased funding to the Status of Women Council and the Native Women's Association. I don't deny that they should get an increase, but how we could just pick these two and ignore the requests coming in every day from other NGOs and other people out there that are requesting some money because the cost of living is going up and everything is costing NGOs more money, and how we can, in good conscience, single out two of them and give them increased funding without looking at the whole picture is beyond me. Again, I think all the power to the Status of Women Council and Native Women's Association for getting the increase, but where is the increase for the other NGOs? That is a very big question that certainly has to be answered.

The other thing I wanted to mention, and I am happy with the way things are laid out in terms of the reorganization, that was a long time coming. I would like to thank the Premier and his department for taking a look at that.

One other thing that I want to bring up, and I guess I can get to it in detail, but the government has spent a lot of money in the Department of Executive in the past on the Visual Identity Program. This is a very interesting one, Madam Chair. I would like to know, going back to 2003, what it cost the Government of the Northwest Territories to come up with this Visual Identity Program. How come, if you look across the Government of the Northwest Territories across the web sites that are being developed, the amount of money that is being spent on these web sites and they are not even following the Visual Identity Program. It just does not make any sense. I am going to ask some specific questions just to prepare the Minister and his staff on this. It is like building a house and not putting any doors on it. What are we doing with the Visual Identity Program? Where is it at right now and where is it going? Those are certainly some questions that the Minister can look forward to. I will leave it there, Madam Chair. Thank you.

Thank you, Mr. Ramsay. General comments.

If I could ask Members to please turn to page 2-17, activity summary, Commissioner's office, operations expenditure summary, $287,000.

Thank you. Page 2-18 and 19, information item, Commissioner's office, active positions.

Thank you. Page 2-21, activity summary, Ministers' offices, operations expenditure summary, $3.956 million.

Thank you. Page 2-23, activity summary, Ministers' offices, grants and contributions, grants, total grants, $173,000. Contributions, total contributions, $542,000. Total of grants and contributions, $715,000. Mr. Braden.

Thank you, Madam Chair. I think, as my colleague Mr. Ramsay mentioned a few minutes ago, we are looking more and more specifically at how we are assisting our partners, the non-government organizations, other agencies that we do business with, Madam Chair, through direct contracts, service contracts, and in a couple of rare cases, through long-term core funding. Now, the two organizations that are named specifically in these pages here are the Native Women's Association of the Northwest Territories and the Status of Women Council of the Northwest Territories. Both organizations do a terrific job in their constituencies, I believe, Madam Chair, and have long been associated with the GNWT. In relation to the grants and contributions made to these two organizations at least, has there been any increment applied for the coming fiscal year in relation to salaries and benefits? It has been demonstrated amply, Madam Chair, that those organizations that we have relied on to help us out, we are not providing them with, what I call, a sustaining increment to help them stay competitive and to attract more people. How are we doing with the Native Women's Association and the Status of Women Council, Madam Chair?

Thank you, Mr. Braden. Premier Handley.