Marsi cho, Madam Chair. Committee wishes to consider Tabled Document 130-19(2), Supplementary Estimates, No. 2.

Does committee agree?

Thank you, committee. We are going to just take a short recess, 10 minutes.

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I call committee back to order. Committee, we have agreed to consider Tabled Document 130-19(2), Supplementary Estimates (Infrastructure Expenditures), No. 2, 2020-2021. Does the Minister of Finance have any opening remarks?

Yes, Madam Chair. I am here to present Supplementary Estimates (Infrastructure Expenditures), No. 2, 2020-2021. This supplementary estimates document proposes a total increase of $162.3 million, comprised of the following items:

• $166.3 million for infrastructure expenditures funding for projects that were not completed in 2019-2020. This amount is fully offset by lapses and appropriations in 2019-2020.
• Negative $4.4 million for adjustments to the timing of expenditures related to five infrastructure projects under the federal Investing in Canada infrastructure plan agreement. This decrease is fully offset by increases in future year project expenditures.
• $448,000 for an enclosed cab snow blower for the Mike Zubko Airport in Inuvik. This amount is fully funded by the federal Airport Capital Assistance Program.

That concludes my opening remarks, Madam Chair. I would be happy to answer any questions that the Members might have.

Thank you, Minister. Do you wish to bring witnesses into the House?

Yes, please.

Thank you. Sergeant-at-Arms, please escort the witnesses into the Chamber. Minister, would you please introduce your witnesses?

Thank you, Madam Chair. On the right is Jamie Koe. He's the Assistant Deputy Minister of Finance. On the left is Terence Courtoreille. He is the director of Management Board Secretariat.

Thank you, Minister. I will open the floor to general comments, and then we will go in by detail afterwards. Member for Frame Lake.

Thanks, Madam Chair. The size of this supplementary estimate is a bit surprising. I think it is $166 million. We passed the capital budget in the previous Assembly, if I remember this correctly. I think it was in the neighbourhood of about $240 million. Can I just get an explanation as to whether this is the largest supplementary appropriation we have made and some explanation as to the size of this? Thanks, Madam Chair.

Thank you, Member. Minister.

Madam Chair, I don't know if it's the largest ever. I'm not sure if either of our witnesses might. I'm getting a nod, so I'm going to assume, then, that it is, Madam Chair. Then they asked for a general explanation or if we'd like to summarize some of the major components thereof? I'm not sure what direction the Member would like to go with that.

Thank you, Minister. Member, did you want to clarify?

Thanks, Madam Chair. I don't mind a general explanation at a high level. I'm also cognizant that I've got eight and a half minutes left on the clock, so I don't want an explanation that's going to gobble up two minutes of time. Thanks, Madam Chair.

Thank you, Member. Minister.

Madam Chair, the largest number of the projects that are impacted here are the Investing in Canada infrastructure projects. Those are the ones that make up the largest chunk of this particular supplementary appropriation request. Thank you, Madam Chair.

Thank you, Minister. Member.

Okay, thanks for that explanation. Can I get a sense of how much of this supplementary appropriation is the result of carry-overs from the previous year? Thanks, Madam Chair.

Thank you, Member. Minister.

Thank you, Madam Chair. I don't have a percentage here. Sorry, Madam Chair, I don't have the math right in front of me. I have two different numbers. Perhaps I'll ask if one of the two witnesses has the total number so that I'm not sitting and doing the math while the Member is waiting.

Mr. Koe.

Member, can you just clarify your question?

Thanks, Madam Chair. Can I get, as a percentage of this supplementary appropriation, how much of it is carried over from the previous financial year? Thanks, Madam Chair.

Thank you, Member. Mr. Koe.

Thank you. Member.

Thanks, Madam Chair. Well, that's great because it accords with the table I'm looking at. Can I get some sense of the trend of the carry-overs over time? Thanks, Madam Chair.

Thank you, Member. Minister.

Madam chair, certainly, a percentage of the total carry-overs from subsequent years certainly, this is the largest percentage over the course of several other years. The average hovers at just over 12 percent. Thank you, Madam Chair.

Thank you, Minister. Member.

Okay, thanks, Madam Chair. That's the issue here. In the past, it was as small as 12 percent, but now it's up to 40. I guess I'd like to understand why we're having this much carry-over in infrastructure spending from one year to the next. Thanks, Madam Chair.

Thank you, Member. Minister.

Thank you, Madam Chair. Certainly, the 42.5 is a much higher number than what I would like to see, as well. I'm cognizant of that. I don't disagree with the Member in that regard. As far as this particular year, quite a number, as I'd mentioned at the outset, of this is relating to the Invest in Canada infrastructure plan, which was a significant project funding program put forward by the federal government, of which we were able to benefit quite a bit from, but it meant that we simply weren't able to carry through and will complete all of those projects. Some of the individual projects have their own individual explanations for why that might have been. For example, the wind project up in Inuvik required further study even afterwards. Then there is also a diesel plant which is now moving forward, but it just took a bit more time to get moving forward on that particular plan because of planning requirements. Each one of these has its own reason. I can certainly go through each one, Madam Chair, but the overall is that there was a large influx of money and that it simply does take a lot of planning and a lot of capacity to get through that. Thank you, Madam Chair.

Thank you, Minister. Member.

Thanks, Madam Chair. The reason why I'm raising this is I was in the last Assembly. We saw this trend of increasing amounts of carry-overs from one year to the next. I took the previous Finance Minister to task over this and suggested that we needed to have some way of tracking what the reason was over time as to why we can't get the money out the door, why we can't do the spending. This is increasingly critical during this pandemic, that we find ways to get money out the door to help stimulate our economy. As the largest driver in our economy, we have to get the money out the door. I need to understand whether this is cashflow problems with the federal government? Is it that we don't have enough capacity to get procurement done in a timely fashion? Is it issues around the contractor capacity is maxed out? What is the problem? Is there a systematic way of tracking what the issue is in terms of getting this money out the door? Thanks, Madam Chair.

Thank you, Member. Minister.

Thank you, Madam Chair. Again, there is not one single reason, but there are a number of reasons. I would certainly say I would like to have a better way of tracking. I would like to ensure we can track exactly those reasons and see what trends there are. Without knowing exactly how we would do that, I would like to make a sort of tentative commitment that we'll be doing that kind of tracking. Again, in this particular case, it was as bad as it was largely because of these particular projects. Quite a large number of large projects all came available for funding all at the same time, which did maximize GNWT capacity in terms of procurement, in terms of project management. It also maximized just local industry capacity and the ability to actually find the contractors in communities to deliver on those projects. Those are two explanations, both at the procurement stage and at the delivery stage. That said, as far as more specifics, Madam Chair, it would be my intention to be back here next year with a much more detailed analysis of those specifics. Thank you, Madam Chair.

Thank you, Minister. Member.

Thanks, Madam Chair. I lived through a previous commitment by the last Finance Minister to start tracking this, and clearly the work hasn't been done. I don't know what the problem is, but we need to have a systematic way of tracking why there is so much carry-over. Look, this government, this Cabinet has identified mega-projects, large infrastructure projects, as the way forward for our economy. I don't personally agree with that, but, if we can't get the money out the door -- because 40 percent carry-over from one year to the next, we need to know what the problem is, what the obstacles are, and start fixing it. I don't want a weak commitment. I want a strong commitment from the Minister that she is going to fix this problem. Thanks, Madam Chair.

Thank you, Member. Minister.

Thank you, Madam Chair. Obviously, the priorities of the Assembly are the priorities of the Assembly and not only those of Cabinet. This is not the first time that I've had the chance to hear what previous Finance Ministers may or may not have done. I have no difficulty in saying that I am who I am, and I intend to follow through on promises that I make. Madam Chair, I have already gone through the process of asking the department why I see certain words over and over again, giving me general explanations. If there is an explanation, then we should be following through on it and fixing the problem. In some cases, there will not be an explanation other than we had an opportunity to take a lot of money from the federal government and we did take that opportunity. I think we'll be able to do a better analysis. Can I promise that we will solve every one of the bottlenecks in the next 12 months, given that we're going to be operating under a COVID challenge this summer in some capacity or another? Certainly not. I can certainly come back here in the future, when there are further carry-overs, because there will be further carry-overs, and be able to give a better analysis, project-by-project, as to why that is and where the bottlenecks are. Thank you, Madam Chair.

Thank you, Minister. Are there any further general comments to the supplementary appropriations? Seeing no further general comments, we will move to the supplementary estimates by department. Committee has agreed to begin the review with the Department of Education, Culture and Employment. I will now open the floor to general comments on the Department of Education, Culture and Employment, operations expenditures. I think that is on page 6. Member for Yellowknife Centre.

Thank you, Madam Chair. Further to my colleague's point about the delay in getting infrastructure projects out, I see here a reference to the JH Sissons School planning study, which I would like to confirm, first of all, is complete. Thank you.

Thank you, Member. Minister.

Madam Chair, I am not sure if the Minister of Education, Culture and Employment would know, in fact, if the planning is complete. I believe it is, Madam Chair.

Thank you, Minister. Minister of Education, Culture and Employment, would you be able to answer that?

Sorry, could the Member please repeat the question?

Thank you. Member, can you repeat your question?

Sure. Is the planning study for JH Sissons School complete?

Thank you. Minister.

Thank you, Madam Chair. Right now, what's going on with the school is that all of the materials in the school have been removed in preparation for demolition. There is a contract in place for abatement and demolition, and there is a tender out for construction at this time. Thank you.

Thank you, Minister. Member for Yellowknife Centre.

Thanks for that, Minister, but that wasn't my question. My question is whether the planning study for the school is finished, and if so, why does it appear in this supp? Thanks.

Minister of Finance.

Thank you, Madam Chair. When something is incomplete in the previous year, then it has to get carried over into this year in order to then be continued on with. Especially the Sissons school project, which is multi-year project, the funding that would be approved in one year still needs to get reapproved into subsequent years.

Again, I don't know exactly what stage the project is at, and if the Member wants a more specific answer, I can certainly turn this back to the Minister of education, but the overall school project is a multi-year project. For that reason, the funding will have to get reappropriated and reapproved, since the project itself is not complete at this point in total, but I don't know the specific stage of where it is at at this moment. Thank you, Madam Chair.

Thank you Minister. Member.

Thanks. I did notice that the construction contract is now on offer, and it was my understanding that the construction was supposed to start this fall. Is that a reasonable time to vet and award the contract and have the construction start, by this fall? Thank you.

Thank you, Member. Minister.

Thank you, Madam Chair. My understanding is that that is still the plan.

Thank you, Minister. Member.

I wonder if this contract is, in fact, coming out later than was anticipated and there is some slippage in the timing on this project. Can the Minister speak to that, please?

Thank you, Member. Minister.

Thank you, Madam Chair. Again, I am a bit conscious that the detailed specifics should be directed to the Minister of Education, Culture and Employment, but I think it is safe to say, really, something that is being experienced and seen across all of the infrastructure projects and a lot of the infrastructure projects that are coming through Finance right now are experiencing some delays as a result of COVID-19, whether it's because of procurement slowdowns, whether it's because of slowdowns on the private sector side, in terms of the ability to have uptake. That is not to say that projects can't get back on track and that they will, in fact, be delayed, only that there likely have been some delays in the last couple of months. Madam Chair, the Minister of Education, Culture and Employment would like to add something. Thank you, Madam Chair.

Thank you, Minister. Minister of ECE.

Thank you. The project is on schedule. There is no delay. The carry-over is the difference between the cash flow forecast produced in 2017 and the actual expenditures incurred during 2019-2020. When you start a project, you estimate what the costs are going to be, and sometimes you don't get it 100 percent right. The project is currently at the end of the design development phase. The 100 percent construction documents were finalized at the beginning of May 2020, at which time the design consultant started the construction tender package. The draft package is completed, and the tender is out right now. Thank you.

Thank you, Minister. Member.

Thank you. If I understand the Minister's answer correctly, the planning study was $1.486 million over budget? Is that what you're saying? Thanks.

Thank you, Member. Minister.

Sorry, Madam Chair. No, that certainly wasn't my understanding of what the Minister of Education, Culture and Employment was saying; just that the total project estimation does require an estimation and that process is not perfect. I'm not sure if the Minister has anything to add.

Thank you, Minister. Minister of ECE, did you have anything else to add?

Sure. This is a carry-over. This is money that was already appropriated and is being carried forward. We're not looking for money that was never appropriated. It's not overbudgeted; it is what was already appropriated, but the cash flow didn't flow during the timeline that was anticipated.

Thank you, Minister. Member.

Thank you, Madam Chair. I wonder if this is an appropriate time to raise the emails that we have all received about the possibility of continuing classes at Sissons school for the next year so that there is more classroom space available for physical distancing. I see all the Ministers looking at one another, so that is for whoever would like to answer it.

Thank you, Madam Chair. I don't even know how long ago it was now; the days have all melded together. The Chief Public Health Officer, when she issued Emerging Wisely, she also issued a backgrounder document pertaining specifically to schools and the measures that needed to be taken in schools. Since that time, the department has been working with the education bodies to come up with plans on how they are going to implement those recommendations in schools to ensure that staff and students and the public remain safe in the upcoming school year.

There are 49 schools, which means there needs to be 49 plans on how to implement it. What is happening now is that there have been a couple of plans that have been done from a large school and from a small school. We are waiting for the Chief Public Health Officer to look at those. Then we can take that feedback and do the other 47 plans. That's where the planning is right now.

In that planning, YK1 has not indicated that they need that space at Sissons, and at a board meeting today, they voted unanimously to continue with the demolition of JH Sissons, because they feel that they can accommodate their students safely, given their existing resources.

I will note that, in Yellowknife, there is some disparity between the utilization rates of the schools. The Yellowknife Catholic schools have high utilization rates in the 90 percent, over 100 percent in, at least, one school, whereas the YK1 schools have a much lower utilization rate. There is more space in those schools, so it's not such an issue for them. Thank you.

Thank you, Minister. Member.

Thanks for that response. The ultimate authority on when the school is going to be demolished is YK1; is that correct? Thank you.

Thank you, Member. Minister.

Thank you, Madam Chair. It is a YK1 asset, as I understand, but obviously, they are in fairly close contact with the Minister of ECE. I don't think it's quite so simple of an answer as that. Thank you, Madam Chair.

Thank you, Minister. Member.

YK1 owns the school; they can tear it down when they want to. That's what I'm hearing? That's it? Thank you.

Thank you, Member. Minister.

Madam Chair, my answer would simply be no, but I think, for a better explanation, I will turn it over to my colleagues. Minister of ECE.

Thank you, Minister. Minister of ECE.

Thank you. Now that we've gotten into the world of decentralized delivery of education, the Minister of education isn't almighty in terms of education and really has limited powers compared to, I think, what the public thinks. What we do do is we collaborate with education authorities, and there's very close collaboration, and we have great relationships. I think, in other jurisdictions, they would be envious of how we relate to the education bodies. If we need to tear down a school and build a new one, it will be a GNWT asset once it's rebuilt, and we will provide that. Even though it's a YK1 asset now, we will be building a GNWT asset. Right? It is a collaborative effort. The planning for the delivery of education in the next school year is on YK1. We really have to work closely with them when we make these decisions. They don't have the ultimate authority. I would say we have the ultimate authority. It's a relationship. Thank you, Madam Chair.

Thank you, Minister. Are there any general comments to page 6, ECE, operations expenditures? Seeing none, if there are no further comments, does committee agree to proceed to the detail contained in the tabled document?

We'll begin on page 6. 2020-2021 Supplementary Estimates No. 2, (Infrastructure Expenditures), Department of Education, Culture and Employment, operations expenditures, early childhood and school services, not previously authorized, $3,060,000. Does committee agree?

Thank you. I will turn to page 7. Sorry. Total department authorized, $3,060,000. Does committee agree?

Can you now turn to page 7. I will open the floor to general comments on the Department of Infrastructure, operations expenditures. If there are no comments, does committee agree to proceed to the details in the tabled document?

2020-2021 Supplementary Estimates (Infrastructure Expenditures), No. 2, Department of Infrastructure, operating expenditures, asset management, not previously authorized, $367,000. Does committee agree?

Department of Infrastructure, operations expenditures, programs and services, not previously authorized, $31,564,000. Does committee agree?

Sorry. Member for Frame Lake.

Thanks, Madam Chair. Can someone tell me what the status of the Inuvik wind project is? Thanks, Madam Chair.

Thank you, Member. Minister.

Thank you, Madam Chair. Just recently, the GNWT did respond to a third information request from the Gwich'in Land and Water Review Board. With that process still actively underway, that's the stage of things, but it is hoped, as I understand, that permits are going to be issued, and that that process is reaching a point of completion such that it could still be en route to getting started or actually completed by the fall of 2021. Thank you, Madam Chair.

Thank you, Minister. Member.

Thanks, Madam Chair. Can I just get a little bit of clarity around who actually owns the land that this project is supposed to be built on? What's the arrangement? Thanks, Madam Chair.

Thank you, Member. Minister.

Thank you, Madam Chair. I am not sure if perhaps the Minister of Infrastructure has that detail. I don't have it in front of me. Perhaps, if I could turn to him, please, Madam Chair.

You are pointing to the Minister of Lands. Minister of Lands.

Thank you, Madam Chair. It's the Government of the Northwest Territories. It's a reserve, and we're working with Indigenous governments on that piece of land right now. It's a reindeer reserve, and we're working with Indigenous governments on that project. Thank you, Madam Chair.

Thank you, Minister. Member.

Thanks, Madam Chair. I don't need this now, but can I get a commitment out of the Minister of Lands to give us a briefing note about the status of the project and the land tenure for it, and whether this is going through an environmental assessment, that kind of thing? There's a lot of finger pointing going on on the other side. I don't really care which Minister provides it as long as we get an update, a briefing note on it. That will be helpful. Thanks, Madam Chair.

Thank you, Member. Minister of Lands.

Thank you, Madam Chair. Yes. I will be working with the Minister of Infrastructure on this, and we'll provide a briefing note to committee, SCEDE, on it. Thank you.

Thank you, Minister. Are there any further questions on page 7? Member for Tu Nedhe-Wiilideh.