Page 2-37, information item, Public Utilities Board, Active Positions. Questions?

Department of Executive, Activity Summary,

Public Utilities Board, Active Positions, information item (page 2-37), approved.

Page 2-39, Activity Summary, Cabinet Support, Operations Expenditure Summary: $2.94 million.

Department of Executive, Activity Summary,

Cabinet Support, Operations Expenditure Summary: $2.94 million, approved.

Page 2-41, Cabinet Support, Grants and Contributions: $791,000.

Department of Executive, Activity Summary,

Cabinet Support, Grants and Contributions: $791,000, approved.

We're now on page 2-42. Cabinet Support, Active Positions.

Department of Executive, Activity Summary,

Cabinet Support, Active Positions, information item, approved.

Page 2-43, Cabinet Support: $14,000.

Department of Executive, Activity Summary,

Cabinet Support, Active Positions, information item: $14,000, approved.

Page 2-44, information item, Lease Commitments — Infrastructure. Questions?

Department of Executive, Lease Commitments

— Infrastructure, information item, approved.

We’re agreed on the details so far. Returning to page 2-11, Program

Summary, Operations Expenditure Summary: $12.976 million.

Department of Executive, Program Summary,

Operations Expenditure Summary: $12.976 million, approved.

Does committee agree that that completes the detail for O&M for Executive?

Thank you, committee. Does committee agree that consideration of the Department of Executive Main Estimates is concluded?

Thank you to the Minister and his witnesses. The witnesses may be escorted from the Chamber by the Sergeant-at-Arms. Thank you.

Does committee agree that we will now move on to the Department of Finance?

Thank you, Mr. Chairman. I’m here to present the Department of Finance’s Main Estimates for the fiscal year 2008–2009.

The Department of Finance is responsible for the Government of the Northwest Territories’ revenue generation and management for fiscal, tax and economic policy development. Finance, therefore, plays an important role in ensuring that the government is able to deliver its programs and make informed decisions about the allocation of its resources.

By virtue of its mandate Finance is directly involved in a number of the GNWT’s strategic activities. Building on the government’s previous macroeconomic policy work, the department will be supporting the Maximizing Opportunities Strategic Initiative Committee in the development of an economic investment framework to guide our decisions regarding investments in the NWT economy. The department will also continue to play a key role in the negotiations on the Net Fiscal Benefit related to devolution and resource revenue sharing.

During 2008–2009 the department will continue to focus on the fiscal issues affecting the GNWT. This

includes priorities identified by the 16th Assembly,

like identifying and consulting on the revenue options available to this government.

Another key initiative for the department in 2008–09 is the finalization of the regulations under the Liquor Act to allow the new act to be brought into force later this year.

The Department of Finance has identified a total expenditure budget of $10.959 million for 2008–09. This represents a 4.4 per cent decrease over the 2007–2008 Main Estimates amount. The net decrease is composed of:

•

a budget reduction of $778,000;

•

a one-time increase of $123,000 to fund a tax auditor term position to the end of 2008–2009 fiscal year;

•

an increase of $128,000 to fund collective

agreement increases and improved Northern Allowance adjustments; and

•

a net increase of $25,000 to reflect a number of small administrative changes and transfers.

The department has reduced its expenditure budget by $778,000 through the following measures:

•

Reducing the premium on GNWT’s property insurance policy by reducing the total values insured, for a savings of $475,000. This was achieved by removing bridges owned by the GNWT, valued at approximately $190 million, from the policy. This change is expected to result in minimal additional risk for the GNWT.

•

Eliminating two positions in the department — an economic policy analyst position in the Fiscal Policy Division and a taxation assistant position in the Treasury Division — will save $181,000.

•

Reducing travel and contract budgets and

other administrative expenses will save an additional $122,000.

That concludes my opening remarks. I’d be pleased to answer questions Members may have. Thank you, Mr. Chair.

Thank you, Mr. Roland. I will now ask Mr.

Abernethy of the Standing

Committee on Government Operations to provide opening comments.

Thank you, Mr. Chairman. I’d like to thank the Minister for his comments.

Members of the Standing Committee on Government Operations met with the Minister of

Finance on April 1, 2008, to review the Draft Main Estimates for the Department of Finance.

Committee members made note that the department is proposing to spend $10.959 million in operation expenses for the fiscal year 2008–2009.

Committee members offer the following comments and issues arising out of the review of the 2008–2009 Draft Main Estimates.

Revenue Increase and Stabilization

Committee members found that in order to create long-term financial stability for the Northwest Territories, the government should not only look at reducing costs but also explore options for revenue increases.

The committee suggested that the Minister look into the following options:

•

The creation of a Heritage Trust Fund that

would allow for progress in the negotiations about resource revenue sharing. Such a Heritage Trust Fund would generate savings for future generations. The GNWT could also transfer portions of potential future surpluses into this trust. Trust fund models to be considered for this undertaking would be Norway and Alaska.

•

Other members felt that the fluctuations in

adjustment for the GNWT’s revenues are too high and suggested the creation of a revenue stabilization fund. The goal of such a fund is to offset fluctuations in GNWT revenues from Canada; namely, grants, transfer payments, corporate income tax and personal income tax.

•

The committee also encouraged the

government to look into alternative means to generate revenue, like taxation of minerals and resources, the introduction of a carbon tax or changes to the fuel tax administration.

The committee hopes that alternatives and new initiatives for revenue generation will be presented during the next business planning cycle.

Operational Review of the Liquor Licensing Board and the Liquor Commission

During the review of the Liquor Revolving Fund, members discussed the operation of the Liquor Commission and the Liquor Licensing Board. Members suggested that the GNWT should explore options to make the operations more efficient and should consider alternative means for liquor control, licensing, distribution and sales.

Recommendation

The Standing Committee on Government Operations recommends that the government undertake a functional review of the operations of the Liquor Commission and the Liquor Licensing Board.

Those conclude the comments of the Government Operations Committee. I’d like to thank the Minister for meeting with us in April, as well as his staff. I’d also like to thank our researcher, Regina Pfeifer, and our clerk, Patricia Russell. Thank you very much.

Thank you,

Mr. Abernethy, and thanks to your committee. I will now ask the Minister if he would like to bring witnesses into the Chamber.

Yes, Mr. Chairman.

Thank you, Mr. Minister. Does the committee agree?

Thank you, committee. Mr. Sergeant-at-Arms, please escort the witnesses into the Chamber. Mr. Roland. I’d ask that you now introduce your witnesses.

Thank you, Mr. Chairman. Mr. Chairman, joining me at the table here to my right is deputy minister of Finance, Ms. Margaret Melhorn; to my left is the director of finance and administration, Mr. Mel Enge.

Thank you, Minister.

I’ll now ask if the committee would like to do general comments.

Moving into the detail. If I can ask you to refer to page 3-7, Department Summary, we will return to this after we’ve considered the rest of our detail.

We will start on page 3-8 with information item, Active Positions — By Region. Questions? That is 3-8. Does committee agree?

Department of Finance, Department Summary,

Active Positions — By Region, information item, approved.