This is page numbers 5085 - 5134 of the Hansard for the 18th Assembly, 3rd Session. The original version can be accessed on the Legislative Assembly's website or by contacting the Legislative Assembly Library. The word of the day was work. View the webstream of the day's session.

Topics

The Speaker

The Speaker Jackson Lafferty

Masi. Minister of Infrastructure.

Wally Schumann

Wally Schumann Hay River South

Thank you, Mr. Speaker. The simple answer is the cost of the product went up, therefore triggering a rate increase. The cost of fuel is driven by factors outside the control of the Government of the Northwest Territories. The Government of the Northwest Territories does not make the market, nor set the cost of fuel. Fuel prices reflect the cost of supply and delivery of petroleum products. The fuel prices are adjusted periodically to reflect the recovery of full fuel costs, including the product cost, transportation cost, sale commission, operations, maintenance expense, and operation losses and taxes. Thank you, Mr. Speaker.

Herbert Nakimayak

Herbert Nakimayak Nunakput

I appreciate the response. The cost of delivery is high in our region, with the current structure that we have. I'm sure there are other competitors that can deliver fuel at a lower rate. However, we rely on the system that we have right now. Based on the average annual consumption, how much would it cost the government to leave the prices of fuel in Ulukhaktok, Sachs Harbour, and Paulatuk where they were before the latest price increase?

Wally Schumann

Wally Schumann Hay River South

The total cost to the government to leave the fuel prices unchanged in all three communities in the Member's riding would have cost us $607,000. To do this, though, to inform this House, would be outside FMB policy. The Financial Management Board sets the direction and policy, and fuel prices are adjusted accordingly. To exempt certain communities from increases would not be consistent or equitable with how all the other communities are treated and would not be affordable to the Petroleum Resources Revolving Fund or the Government of the Northwest Territories.

Herbert Nakimayak

Herbert Nakimayak Nunakput

I understand that sometimes the cost of delivering goods is out of our control and we must comply. Just to come back, the cost of living is high in the northern part of the territory. I appreciate the Minister's response, because I know they're always looking out for the best interests of our residents. My final question is: will the Minister commit to working with his colleagues and myself to revise the process for setting fuel prices in remote communities to ensure that they reduce the cost of living and do not result in hardship for people?

Wally Schumann

Wally Schumann Hay River South

As I said, the Petroleum Products Revolving Fund Act requires the Department of Infrastructure to recover all operating costs from the sale of our fuel. The proposed changes would be contrary to the petroleum resource program, which is self-funded and would have to be debated and voted on in the Legislative Assembly if we were to do something like that, Mr. Speaker.

The Speaker

The Speaker Jackson Lafferty

Masi. Oral questions. Member for Yellowknife North.

Cory Vanthuyne

Cory Vanthuyne Yellowknife North

Thank you, Mr. Speaker. My questions today are for the Premier. Earlier today, in my statement, I talked about the Mackenzie Valley Resource Management Act and the need to bring it home to the North. In 2014, we devolved the land, water, and resources to the Northwest Territories, but we didn't devolve the regulatory controls. I would like to ask the Premier: what are the biggest potential benefits of a review of the Mackenzie Valley Resource Management Act from our government's point of view? Thank you, Mr. Speaker.

The Speaker

The Speaker Jackson Lafferty

Masi. The Honourable Premier.

Bob McLeod

Bob McLeod Yellowknife South

Thank you, Mr. Speaker. Essentially, the elements of the MVRMA within the devolution agreement are being reviewed. The potential benefits are all related to increased local decision-making, for example, items listed in 3.17 of the devolution agreement, including approval of issuance of Type A water licences, which a Member referred to in his Minister's statement, designation of inspectors and board-appointment decisions. For example, Aboriginal governments, such as the Tlicho, can appoint their own members, and our government cannot. This is an oversight that we intend to address, as well. Thank you, Mr. Speaker.

Cory Vanthuyne

Cory Vanthuyne Yellowknife North

Thank you to the Premier for that reply. I would also like to ask the Premier what sort of research or let's call it preparation has our government done to get ready for the review of the federal MVRMA?

Bob McLeod

Bob McLeod Yellowknife South

The Government of the Northwest Territories has been working within this regulatory system since the 1990s with both the federal government and Aboriginal governments. That was when the MVRMA first came into effect. We have continued to work within the system post-devolution. The federal review will ideally lead to further delegation of province-like authorities, and our system is ready to take on those authorities.

Cory Vanthuyne

Cory Vanthuyne Yellowknife North

I think that is welcome commentary from the Premier. I would also like to ask what communication, in fact, has there been between our government and Canada with regards to the subject of reviewing the MVRMA?

Bob McLeod

Bob McLeod Yellowknife South

I and the government have regularly communicated to federal leaders the importance of fulfilling these commitments set out in the devolution agreement. As a matter of fact, with the change in government four years ago, we made the suggestion that we should get rid of the five-year requirement and start the review right away, but there was some unfinished business with regards to some of the changes that were being proposed. We have waited until those were addressed satisfactorily.

The devolution agreement commits to the development of the terms of reference of the review after April 1, 2019. I am pleased to advise the Member that the Minister responsible for Northern Affairs has readily agreed to commence this review even earlier than what was provided for in the devolution agreement.

The Speaker

The Speaker Jackson Lafferty

Masi. Oral questions. Member for Yellowknife North.

Cory Vanthuyne

Cory Vanthuyne Yellowknife North

Thank you, Mr. Speaker. It seems as though there is more good news, and we are slowly making our way to full devolution, including having regulatory control here in the North. Mr. Speaker, what communication has there been between our government and Indigenous governments and industry in the NWT about potential review of the MVRMA? Thank you, Mr. Speaker.

Bob McLeod

Bob McLeod Yellowknife South

We are in regular communications with Indigenous governments through the Intergovernmental Council. Obviously, they play an integral part in any of these decisions. The concerns that they had addressed when they went to court four years ago, I think that those are being addressed. I think I will be in a good position to move forward. Thank you, Mr. Speaker.

The Speaker

The Speaker Jackson Lafferty

Masi. Oral questions. Member for Yellowknife Centre.

Julie Green

Julie Green Yellowknife Centre

Mahsi, Mr. Speaker. My questions are for the Minister of Finance. Two years ago, his colleague, the Minister of Infrastructure, told the Member for Yellowknife North that the all-in cost of the road to Whati was estimated at $175 million. The cost of building the road announced this month is 20 percent higher than that figure. Why are construction costs so much higher now than two years ago? Mahsi.

The Speaker

The Speaker Jackson Lafferty

Masi. Minister of Finance.

Robert C. McLeod

Robert C. McLeod Inuvik Twin Lakes

Thank you, Mr. Speaker. The direct construction cost, I think the Member made it in her statement before, $185 million. The total capital cost of $214 million, that would include the crude interest, predevelopment costs, and also GNWT costs for geotechnical studies, the EA process, project management, and provide funding for the measures resulting from the EA process Thank you, Mr. Speaker.

Julie Green

Julie Green Yellowknife Centre

I appreciate the Minister's response, but I didn't hear an answer. In two years, the two figures have differed by 20 percent. Can he tell us why that is?

Robert C. McLeod

Robert C. McLeod Inuvik Twin Lakes

The initial $175 million from the cost two years ago, since then obviously, the price to direct construction cost went up to $185 million. That is a $10 million difference. Maybe the prices of material and things have changed. I am not sure exactly what that $10 million is made up of, but I can get that information and provide that information to the Member.

Julie Green

Julie Green Yellowknife Centre

I appreciate that commitment from the Minister. I don't recall any discussion of the potential costs of operations and maintenance prior to the announcement earlier this month. I note that the Minister of Infrastructure didn't repeat the all-in cost of $411 million in his statement last week. My question is: what efforts did the government make to inform the public of the actual all-in costs of this road, given that it was more than double any estimate that had been voiced publicly?

Robert C. McLeod

Robert C. McLeod Inuvik Twin Lakes

The direct construction costs are $185 million, as was noted previously. The total capital cost was $214 million, as was noted previously as well as some of the reasons the cost was that high. The $400 million through the P3 partnership, that would represent the total value of the 28-year contract with NorthStar Infrastructure, who are the proponents of the Whati road, of which 25 years of operations and maintenance payments are included.