Merci, Monsieur le President. Your Standing Committee on Government Operations is pleased to provide its Report on the Review of Bill 1: Western Canada Lottery Act, and commends it to this House.

Introduction

The Standing Committee on Government Operations is pleased to report on its review of Bill 1: Western Canada Lottery Act.

Bill 1, sponsored by the Department of Municipal and Community Affairs (MACA), repeals the existing Western Canada Lottery Act (WCLA) and replaces it with a new act to establish a Northwest Territories Lottery Commission, under the direction of the Minister, with the authority to enter into agreements with the Western Canada Lottery Corporation (WCLC), and the Government of Nunavut and retailers.

The act also establishes a Northwest Territories Physical Activity, Sport and Recreation Fund ("the fund"), pursuant to Part 7 of the Financial Administration Act (FAA). This special purpose fund, which will form an account within the Consolidated Revenue Fund, will receive proceeds from the operation of lotteries by the WCLC. The commission will be responsible for the conduct, management and operation of lotteries, while the Minister will administer the fund and distribute proceeds for purposes related to the promotion and delivery of physical activity sport and recreation programs.

Bill 1 received Second Reading in the Legislative Assembly on October 20th, 2017, and was referred to the Standing Committee on Government Operations for review.

Background

Currently, the Western Canada Lottery Act (WCLA) authorizes the Minister to enter into agreements with any corporation established to conduct the Western Canada Lottery, for the purpose of undertaking, organizing, conducting or managing the Western Canada Lottery in the Northwest Territories.

The Western Canada Lottery Corporation (WCLC) is a Canadian non-profit organization, founded in 1974 and headquartered in Winnipeg, Manitoba, that operates lottery and gaming-related activities for its members; the governments of Alberta, Saskatchewan and Manitoba. Yukon, the Northwest Territories, and Nunavut participate as associate members.

The WCLC works in conjunction with the following marketing organizations: Alberta Gaming and Liquor Commission; Saskatchewan Lotteries; Manitoba Lotteries Corporation; Lotteries Yukon; and the Sport North Federation, which signed a licensing agreement with the WCLA in 1979. In 2009, the Northwest Territories Sport and Recreation Council (SRC) became the designated licence holder.

In 2011, the Canada Revenue Agency advised the licensee that conduct of the lottery was a for-profit activity and, therefore, income was taxable under the federal Income Tax Act. In November of 2014, the Canada Revenue Agency provided this interpretation to the Department of Finance.

In December 2014, MACA reviewed options with the Departments of Finance, Justice and Human Resources for shielding lottery proceeds from taxation. This bill represents the culmination of that process.

The Public Review of Bill 1

The Standing Committee on Government Operations held a public hearing on Bill 1, in Yellowknife, on February 7, 2018.

The committee chairperson opened the meeting, followed by opening remarks by the honourable Minister of Municipal and Community Affairs, who was accompanied by the following officials:

• Ms. Eleanor Young, deputy minister, Municipal and Community Affairs;

• Mr. Ian Rennie, legislative counsel, Department of Justice;

• Mr. Ian Legaree, director of Sport, Recreation and Youth, Municipal and Community Affairs;

• Mr. Gary Schauerte, director of Corporate Affairs, Municipal and Community Affairs;

• Ms. Melissa Kruger, senior policy and legislative advisor, Municipal and Community Affairs; and finally

• Ms. Mira Dunn, ministerial special advisor, Executive and Indigenous Affairs.

The committee takes this opportunity to thank Minister of Municipal and Community Affairs and her officials for their appearance before the committee.

The hearing was extremely well attended, with approximately 30 members of the public in attendance. The standing committee thanks everyone who came to the meeting, especially those who took the time to provide their input through written and/or oral submissions. All written submissions received by the committee are appended to this report.

What We Heard

More funding for the arts

Committee was struck by the conviction with which witnesses spoke of the many positive benefits derived from the participation in artistic endeavours, including the creation of jobs and economic opportunities; the provision of educational and personal growth opportunities; mental health benefits; the contribution of arts to vibrant and attractive communities and to civic engagement; and the impact of art on our northern cultural identity and the creation of cultural legacies.

A few witnesses spoke of the value that would be derived by members of the arts community in Yellowknife, if people who wanted to participate in artistic pursuits had a publicly funded building in which such activities could be housed. They stressed that art supplies and materials can be cost-prohibitive and noted that a public arts facility would make art a more viable option for the less privileged members of our community, especially youth. They spoke of the benefits enjoyed by sports enthusiasts who have both the Yellowknife Multiplex and the Fieldhouse in which they can engage in sport and recreation activities. They asked only that Yellowknife artists be given the opportunity to enjoy similar benefits.

Speakers stressed the importance and necessity of territorial government funding to a thriving arts community in the Northwest Territories. Many wanted to see greater funding for the arts from the GNWT, and expressed the hope that Bill 1 would provide an opportunity to direct additional funding to the arts through the proceeds derived from the Western Canada Lottery program. Some witnesses also noted that they would like to see the arts benefit from multi-year funding arrangements, similar to those enjoyed by territorial sports organizations, which would allow them to stabilize their programming and enable them to spend less time preparing annual funding requests to be submitted to the NWT Arts Council.

At this time, Mr. Speaker, I'd like to turn the report to my colleague, the honourable Member from Sahtu.