This is page numbers 5203 - 5254 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 going. View the webstream of the day's session.

Consideration In Committee Of The Whole Of Bills And Other Matters
Consideration In Committee Of The Whole Of Bills And Other Matters

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The Chair

The Chair R.J. Simpson

Thank you. Minister.

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Robert C. McLeod

Robert C. McLeod Inuvik Twin Lakes

Thank you, Mr. Chair. My understanding is it's about $1.2 million for this fiscal year.

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The Chair

The Chair R.J. Simpson

Thank you. Mr. Vanthuyne.

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Cory Vanthuyne

Cory Vanthuyne Yellowknife North

Okay. The reason why I raise this, Mr. Chair, is because I appreciate that we are not experts in certain fields and we need to hire and form agreements. We just talked about that, in fact, over here as it related to the Heritage Fund, about getting experts to manage certain things. That said, though, when I look at other jurisdictions that are responsible for their information super-highways, Alberta is a good example. The Government of Alberta maintenance ownership over that asset and then might have a small contractor managing the technical aspects of it, but they get to generate significant revenue off of it by leasing, for lack of knowing the technical term, but essentially "leasing space out" to those who have an interest in accessing the information highway. I think that it would have been an excellent opportunity for us in the arrangement that we made with regard to this fibre optic line to find a way in which this could have ended up being a much larger revenue generator for us as a government. It seems to me that, clearly, we are paying an abundance of money to a manager, and yet we are making very little on the other end in terms of revenue. So how long do we have this agreement in place, and is there a future opportunity to renegotiate a financial situation that is going to be more beneficial to northern ratepayers? Thank you, Mr. Chair.

Consideration In Committee Of The Whole Of Bills And Other Matters
Consideration In Committee Of The Whole Of Bills And Other Matters

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The Chair

The Chair R.J. Simpson

Thank you. Minister.

Consideration In Committee Of The Whole Of Bills And Other Matters
Consideration In Committee Of The Whole Of Bills And Other Matters

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Robert C. McLeod

Robert C. McLeod Inuvik Twin Lakes

Thank you, Mr. Chair. The agreement is for 20 years. This was a P3 partnership, and so we are paying fees on that, and we make $1.2 million. As far as renegotiating, I am not sure if there is an opportunity to renegotiate. Maybe I will go to our fibre-line expert through you, Mr. Chair.

Consideration In Committee Of The Whole Of Bills And Other Matters
Consideration In Committee Of The Whole Of Bills And Other Matters

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The Chair

The Chair R.J. Simpson

Thank you. Mr. Kalgutkar.

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Kalgutkar

Thank you, Mr. Chair. At the end of the contract, the fibre line does become a GNWT asset, and, at that time, it would mean an opportunity to either renew the contract with Northern Lights Fibre Consortium or just look for another service provider to maintain and operate the line for us. As the Member says, it is fairly specialized. You need fairly specialized expertise to manage the fibre, so it would likely be in the best interests of the government to look at somebody, whether it's Northern Lights or somebody else, to manage the fibre for us. Thank you, Mr. Chair.

Consideration In Committee Of The Whole Of Bills And Other Matters
Consideration In Committee Of The Whole Of Bills And Other Matters

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The Chair

The Chair R.J. Simpson

Thank you. Mr. Vanthuyne, your time has expired. Anyone further? Seeing none, I will call this activity. Finance, management board secretariat, operations expenditure summary, $76,734,000. Does committee agree?

Consideration In Committee Of The Whole Of Bills And Other Matters
Consideration In Committee Of The Whole Of Bills And Other Matters

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Some Hon. Members

Agreed.

Consideration In Committee Of The Whole Of Bills And Other Matters
Consideration In Committee Of The Whole Of Bills And Other Matters

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The Chair

The Chair R.J. Simpson

Thank you, committee. Please turn to the fifth activity, Office of the Comptroller General. Comments or questions? Seeing none, I will call the activity. Finance, Office of the Comptroller General, operations expenditure summary, $64,933,000. Does committee agree?

Consideration In Committee Of The Whole Of Bills And Other Matters
Consideration In Committee Of The Whole Of Bills And Other Matters

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Some Hon. Members

Agreed.

Consideration In Committee Of The Whole Of Bills And Other Matters
Consideration In Committee Of The Whole Of Bills And Other Matters

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The Chair

The Chair R.J. Simpson

Thank you, committee. Committee, we have an information item at the end of this department. Comments or questions? Seeing none, we will return to the departmental total, which is found on page 135. As I stated earlier, we will leave the borrowing plan until after we are done with the department, and then we will move to the borrowing plan. If we have comments or questions on the totals, the organizational charts, or the revenue summary, now is the time to ask them. Mr. Vanthuyne.

Consideration In Committee Of The Whole Of Bills And Other Matters
Consideration In Committee Of The Whole Of Bills And Other Matters

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Cory Vanthuyne

Cory Vanthuyne Yellowknife North

Thank you, Mr. Chair. The Minister knows that, on occasion, I have questioned what the future of the territorial financing formula might look like and what opportunities there might be to negotiate or renegotiate that with the federal government. That aside, I think what we all know typically is that the agreement is that own-source revenues, the more that we generate, there is some clawback on the territorial financing formula. However, interestingly enough here, I see that the grant from Canada has grown a little bit compared to last year and more so from the year prior, but then our own-source revenues have also grown. I am wondering: was there no clawback, or how did we manage to generate more of our own-source revenue without having a reduction in the federal grant from Canada? Thank you, Mr. Chair.

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Consideration In Committee Of The Whole Of Bills And Other Matters

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The Chair

The Chair R.J. Simpson

Thank you. Mr. Stewart.

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Stewart

Thanks, Mr. Chair. The way the formula works in terms of the grant from Canada is it does look, as you note, around our own-source revenue and those sorts of things, but, to take out the fluctuation, it uses a moving average of a couple of years of critical data in terms of the escalators that are built into the formula. So sometimes you will see it both going up, and sometimes you will see it going the other way, but it is to smooth it out, and that is part of the reason why you would see the scenario that you are talking about. In terms of the grant itself, it is a three-year moving average, and it uses, actually, lag data, so it's from data from two years previously so that you have lots of time to plan for what you know what your formula is going to be. That is part of the reason that you see the pattern that the Member described. Thanks, Mr. Chair.

Consideration In Committee Of The Whole Of Bills And Other Matters
Consideration In Committee Of The Whole Of Bills And Other Matters

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The Chair

The Chair R.J. Simpson

Thank you. Seeing nothing further, I will call the departmental total. Finance, total department, $258,202,000. Does committee agree?

Consideration In Committee Of The Whole Of Bills And Other Matters
Consideration In Committee Of The Whole Of Bills And Other Matters

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Some Hon. Members

Agreed.

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Consideration In Committee Of The Whole Of Bills And Other Matters

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The Chair

The Chair R.J. Simpson

Thank you, committee. Does committee agree that this concludes our consideration of the Department of Finance?

Consideration In Committee Of The Whole Of Bills And Other Matters
Consideration In Committee Of The Whole Of Bills And Other Matters

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Some Hon. Members

Agreed.

Consideration In Committee Of The Whole Of Bills And Other Matters
Consideration In Committee Of The Whole Of Bills And Other Matters

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The Chair

The Chair R.J. Simpson

Thank you, committee. I will ask the Minister and the witnesses to stay put, as we are now moving to the borrowing plan. It is the second blue tab in the document. Right after the summary tab, we see a blue tab that says "borrowing plan." As is our tradition and the requirement, we will go through this and vote on this item. First, I have Mr. Vanthuyne for comments or questions.

Consideration In Committee Of The Whole Of Bills And Other Matters
Consideration In Committee Of The Whole Of Bills And Other Matters

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Cory Vanthuyne

Cory Vanthuyne Yellowknife North

Thank you, Mr. Chair. Just a couple of things that I have. I always find it interesting when I see the word "contingency" when it comes to government spending. It seems like, in our borrowing here, we've identified in certain line items "contingency." I appreciate the asterisk here that says, "Contingency amounts are based on the estimated working capital requirements during the year, which can vary significantly." What I'm trying to understand is, how does borrowing even have a contingency to begin with? This could be totally an ignorant question, but I'm trying to understand this. I'm a project manager by background, and I've always recognized, in my previous years in working with the government, that government, or I should say taxpayers at large, don't really approve of contingencies. So I'm trying to understand, what does "contingency" as it relates to Government of the Northwest Territories borrowing? Thank you, Mr. Chair.

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Consideration In Committee Of The Whole Of Bills And Other Matters

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The Chair

The Chair R.J. Simpson

Thank you. There's no such thing as a stupid question, Mr. Vanthuyne. Mr. Stewart.

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Stewart

Thanks, Mr. Chair. I'll deal with the first line here on short-term debts. Our short-term debt is essentially our cash shortfall, if you like. The main estimates project that, if the short-term debt is going to go from $318 million up to $325 million during the year, with short-term debt, you can imagine a scenario where, for example, if we had a very bad fire season and our supplementary appropriations were much greater than we expected to be. So what this is doing is saying, let's put in a contingency amount so what this Appropriation Act is saying is that, if you need to borrow on short-term debt up to $390 million, the Legislative Assembly is giving you that authority through this appropriation.

You can't know on all of these. You're forecasting which is what's in the main estimates of our best guess for March 31, 2020, and then, we're giving ourselves some room, particularly on something like short-term borrowing for things like emergencies related to fires and those sorts of things that would be unexpected. It's really just to give room so that, if there is an emergency, you can do that spending without having to come back and seek an appropriation on that type of a basis. That's probably the cleanest explanation. Thanks, Mr. Chair.

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The Chair

The Chair R.J. Simpson

Thank you. Mr. Vanthuyne.