EdinburghNLP/nunavut-hansard-plusplus huggingface dataset:
Question 434 – 3(3): 2013-14 Capital Estimates (Elliott)
My questions are for the Minister of Finance and are based around his Minister’s Statement regarding the Government of Nunavut’s 2013-14 fiscal update.
The Government of Nunavut’s proposed 2013-14 capital estimates are approximately $152 million. This is approximately 60 percent higher than the Government of Nunavut’s 2012-13 capital estimates, which were approximately $94 million.
How did the government determine that the increase is affordable?
I thank Mr. Elliott for his question and concern that the government can’t afford these projects.
Mr. Speaker, we put out a call letter to all departments. The target was $94 million and we factor in $15 million.
We usually try to average $110 million a year.
The departments came back with well over $250 million in capital projects.
As we all know, there’s a huge infrastructure deficit in Nunavut. Based on a lot of interdepartmental deliberations and meetings over the summer, officials working with the Department of Finance determined that the government could afford the $152 million for 2013-14. We spend a lot of time in the Department of Finance monitoring cash flow.
We work with the Department of Community and Government Services. We have many programs; the Building Canada Fund, gas tax funds; and funds flowing in and out. So this is what the department determined.
We brought some projects forward that were deferred because of the housing corporation, housing issue there a couple of years ago.
Those projects were deferred to allow us to complete those houses and they are going back on the capital plan.
The minister stated, “We have focused on addressing the pent up demand for capital funds in our plans for 2013-14 as opposed to introducing new capital initiatives.”
In stating this it is hard to discern exactly what the minister means by saying “addressing the pent up demand for capital funds.” Could the minister elaborate on what is meant by this?
It’s quite simple, Mr. Speaker. In my earlier answer, we had over $250 million in departmental requests. It could easily have been over a billion.
We know that there is a need for over 3,000 houses in Nunavut. We know that every community requires municipal infrastructure.
It could be community halls. It could be health centres, high schools. You name it, it’s out there.
We met with the Prime Minister of Canada this summer in Cambridge Bay. We told him that over 20 years, there is a $6 billion infrastructure deficit. We didn’t give him the details, but he took note of that.
So there’s a pent up demand. With our limited capital budget, we have to work with our cash flow and the programs that the Government of Canada provides to all provinces and territories. There is the Building Canada Fund, the Gas Tax Fund, and the rural infrastructure fund.
We are addressing our pent up demand.
Again, the minister had said that they’re dealing with the pent up demand by talking to different levels of government and using different gas tax and Building Canada funds.
Is there anything being done within the Government of Nunavut in terms of CGS, which is one of the huge departments for having project officers monitor these projects and sometimes getting behind? There is also, I think, some of the explanations that I have been given is the short construction season.
Are there other things within the government or the department that you’re doing differently to make sure that this capital carryover and the pent up demand or the buildup of projects being left on the books year after year to actually push them through? Is there anything new being done other than what has been done in the past?
While I’m not the Minister of Community and Government Services, the minister and I work quite closely together.
We do note that there is a high capital carryover every year. I think it was partially answered in Committee of the Whole the other day. A lot of the projects are tied to the Building Canada Fund and the Gas Tax Fund, but internally, our departments are working very closely together to address the issue.
There is a new capital planning process, a refined capital planning process that will be introduced for the next fiscal year, not the fiscal year we’re dealing with now but for 2014-15. That will be more refined. We’re talking about bringing forward projects that will have more detailed cost estimates before they’re actually introduced into the capital plan.
There are internal discussions going on and I know that the Minister of Community and Government Services is quite concerned, as I am, with the carryovers. If you carry over too many projects, there’s a risk of additional costs due to construction inflation, and so on. So we’re very cognizant of the concern and we’re working to address it.
The minister just talked about the $6 billion in infrastructure deficit. He mentioned about the $250 million that has come forward this year that departments were asking for. He has talked about pushing forward some projects and I think there’s $17.1 million allocated for new capital.
I’m just curious: what process was used to determine which new capital projects or capital initiatives would come forward?
I feel like I’m the Minister of Community and Government Services answering these questions.
Mr. Speaker, as I said earlier, the departments did come forward with many requests. The number $250 million is out there. I said that there were interdepartmental deliberations.
We had to bring back some projects that were deferred because of the Nunavut Housing Trust and the Affordable Housing Initiative from a couple of years ago. So those projects were bought back.
In the interdepartmental deliberations, some of the projects were high priority that had to be addressed and they couldn’t be put off another year. Some projects that could be put off a year were put off a year. It’s all the function of cash flow.
It is a challenge to deliver a capital planning project in Nunavut.
I can’t tell you how challenging it is, Mr. Speaker. I was a mayor for many years in Cambridge Bay and dealt with the government.
As an MLA, as my colleagues are for many years, when you’re a minister, we know the challenges all the communities face. I have talked to mayors. I have talked to some of the SAOs last week who were here for the NAMA conference.
It is a challenge. The Government of Nunavut does the best they can. With the limited resources we have, we try to allocate resources for all the important priority projects in Nunavut.
It’s not to say that everybody is going to get what they want in a given year, but we work very hard to meet the challenges that the communities face and also our own challenges as a government. We do need schools, we do need health centres, and we recognize that.
We continue our conversations with our Member of Parliament and with the Prime Minister of Canada.
We have hope that our discussions will bear some fruit at some point.
Members will note that the allotted time for question period is expired.
I would like to recognize this individual who just walked in, Paul Puqiqnak from Gjoa Haven.
He’s a member for the DEA in our community and he’s attending the meeting here in Iqaluit.
I want to state that he is working on Gjoa Haven at the extended care and helps the people.
I am very proud of him because he helps his elders out.
We will move on then.
Tabled Document 239 – 3(3): Qulliq Energy Corporation’s 11th Annual Report for 2011-2012 (Kusugak)
I am pleased to table the Qulliq Energy Corporation’s 11th Annual Report for 2011-12.
Tabled Document 240 – 3(3): Information and Privacy Commissioner of Nunavut Annual Report 2011-2012 (Speaker)
Tabled Document 241 – 3(3): 2011-2012 Financial Statements of the Retiring Allowances Fund (Speaker)
Tabled Document 242 – 3(3): 2011-2012 Financial Statements of the Supplementary Retiring Allowances Fund (Speaker)
Tabled Document 243 – 3(3): 2011-2012 Annual Report of the Languages Commissioner of Nunavut (Speaker)
Thank you, Members. I have four documents that I’ll be tabling today. The first one is the 2011-12 Annual Report of the Information and Privacy Commissioner of Nunavut.
The second one is the 2011-12 Financial Statements of the Retiring Allowances Fund; the 2011-12 Financial Statements of the Supplementary Retiring Allowances Fund; and the 2011-12 Annual Report of the Languages Commissioner of Nunavut. I wish to advise members that I will provide the Inuinnaqtun translation… .
I’ll save that one for later.
It’s Friday.
Bill 44 – An Act to Amend the Justices of the Peace Act – Second Reading
I move, seconded by the hon. member from Kugluktuk, that Bill 44, An Act to Amend the Justices of the Peace Act, be read for the second time.
Mr. Speaker, this bill establishes a committee to make recommendations on appointments and remuneration for justices of the peace and also amends the complaints process.
Any opposed? The motion is passed and Bill 44 is referred to the Standing Committee on Legislation.
Before we proceed into Committee of the Whole, we will take a short five-minute break.
>>House adjourned at 10:57 and Committee resumed at 11:14
We wish to continue with the review of Bill 41, Appropriation (Capital) Act, 2013-2014, and the Nunavut Housing Corporation, followed by the Department of Health and Social Services, if time permits.
Does the committee agree to deal with those items?
Minister Taptuna, I would like to ask you to return to the witness table.
Thank you, Minister Taptuna. Do you have witnesses that you would like to bring to the table?
Good morning. Thank you.
Minister Taptuna, for the record, please introduce your witnesses.
To my right is the President of Nunavut Housing Corporation, Mr. Alain Barriault. On my left is Lori Kimball, the Chief Financial Officer.
Mr. Barriault and Ms. Kimball, welcome to the House.
During the committee meeting yesterday, we finished the opening comments from the minister and the chair of the standing committee, Mr. Rumbolt.
I will now open the floor for general comments. I am seeking general comments, not questions. At this time, are there any general comments from the members?
We will move on to page G-3. (interpretation ends) Nunavut Housing Corporation. Branch Summary.
I have a couple questions and I would like to get a response to this concern in regard to the new rental rate review. It has been reviewed for a very long time now and it seems like it’s been reviewed endlessly. We expected it to be completed and it needs to be completed.
When do you expect to see the completion of the rental review? What is causing the delay on the completion of the review?
Is it because there is no employee there or because it’s not your priority in your department?
Can you elaborate further why they’re not completing that?
The rental review, we had indicated in the earlier days of the government that the review is going to be ongoing and it’s near completion.
It has been a big challenge. As you know, all the departments of the government have been involved, especially Health and Social Services and Education.
As the member knows, there are over 5,000 public units and a lot of people who have to be considered.
As I indicated to one of the members earlier during question period, we’re hoping to complete that review and have it tabled by the spring sitting.
Yes, that’s the timeline.
My question was: exactly what’s involved, details? Why isn’t it a priority to get it done?
That was part of my question and I need these two answered before making a further comment on it.
It is a priority for the Nunavut Housing Corporation and for the government.
It’s one of those things that prove very difficult and complicated. As you know, we do have to abide by the Canada Mortgage and Housing Corporation legislation, even our legislation in Canada that we do have to abide by. It has brought us some difficulties.
We want one that fits Nunavummiut and that has proven to be very difficult, but we’re making headway. As I indicated, that has been one of the problems. Hopefully, by the spring sitting, we will have that review complete.
I think that timeline is way too far for the following reason: the current rental system discourages potential workers from getting a job. With the current rate right now, the rent scale is either going to double or triple.
So it has been a disincentive for way too long for young people who wish to work.
I know it’s not going to be immediate, but the following year, when the new rent is assessed on the individuals, it will have a huge impact on these assessments with respect to the rental stuff.
So in that regard, I think the minister should take into consideration that getting young people to work in seasonal jobs is critical and the government is in support of it.
Right now, the government doesn’t even know what the unemployment rate is. So closing that gap indicates that hiring Nunavutmiut for seasonal jobs is not a priority.
So I think the minister has options to move that completion date to an earlier date and thereby would prove to convince Nunavutmiut that the government is giving individuals an opportunity to work in the fields that they would like to.
Could the minister consider moving the date a little closer? After all, it has been ongoing, I believe, for the last five years.
It’s absolutely critical that we try and get this done for the benefit of Nunavummiut.
I agree that it has been a disincentive in the past for young people who are entering the workforce. The scale that we’re looking at is a sliding scale that’s going to be based on income of the individuals in the household.
Mr. Chairman, the member probably recalls in his time being the minister of the housing corporation that there’s a very low number, about 138 households, that do actually pay maximum rent and we’re trying to find ways to encourage more folks to enter the wage economy to actually get the process started where I think it’s more like an attitude change.
In Nunavut, we do have the lowest rent assessed for public housing compared to other jurisdictions in the world and I would like to try and move the process forward.
We will do all we can to move the process forward.
I do know what the unemployment is in Nunavut; it’s 12.7 percent.
I appreciate that and I noted too that the ministers are finally starting to realize that they have to consider the unemployment rate after a few statements have been made about it.
Prior to that, it was never an issue most of the time.
What I’m getting at is the plans may be quite good and there might be quite a few that pay the maximum rent, but when you don’t work, that maximum rent is really quite high.
That maximum rent should not be assessed to seasonal workers because the majority of clients, as far as the housing corporation is concerned, are mostly unemployed citizens.
Occasionally, in the past, they had an opportunity to work, but I have been approached by unemployed guys who said, “I could have [worked], but my rent is going to increase.”
So it’s a fear of being assessed and penalized.
As a result of that, it discourages individuals to try to find work and that is not an Inuit way.
When I was a kid, the only employment that we had was outdoors.
If it was a little windy, we would get discouraged, but it was never an impediment for going after what we needed to do for economic survival because the fur trade was the only employment.
Nowadays, the work ethic that we have is based on government policy.
If you work, your rent is going to go high, sky high for the people who can’t afford it because they know they can only work for three months out of the whole season.
For that reason, many are sitting and not doing anything.
With all the resources the government has in getting the review done, why is it not being done next month, for instance?
A very good assessment.
As I indicated, I do want to make efforts to move the process forward, faster. In our jurisdiction of Nunavut, the maximum rent assessed per household is 28 percent of their income, so it’s one of the lowest in Canada.
Once a seasonal worker is unemployed, they make that notification to the LHO and their rent is reduced immediately.
On the other hand, when they do find employment, their rent doesn’t go up automatically; it’s usually within 10 months up to a year. They do have that grace period of where they’re paying the minimum rent, even though they’re collecting employment wages.
The assessment is considered fair compared to other jurisdictions and 28 percent is one of the lowest in our nation, and I do want to try and make efforts to move the process forward quicker.
Mr. Curley: Thank you. Yes, I appreciate that.
It may be the lowest in Canada, but the cost of living is the highest in Canada. So perhaps to try and [make] that comparison to Canada is really another excuse of saying, “Suffer a bit. If you can’t, we will finally have the lowest in Canada.”
Almost every stat that I have heard is the highest in Canada, but it’s almost impossible these days.
People have lost hope in finding a job, unless it’s a public service job.
My point, Mr. Chairman, is: in order to get this done, what are the remaining unfinished evaluations of work that have to be completed in order to table this or change the rental policy?
Can the minister indicate to the House exactly what needs to be done at this time?
I’ll have the President of the Nunavut Housing Corporation, Mr. Barriault, respond to that.
The final process that the housing corporation is going through right now is just really refining and finalizing the financial assessments of the impacts of the different options that are being put together for cabinet consideration.
So once those are finalized, then they will able to be move forward.
Chairman (interpretation): Thank you, Mr. Barriault. Anything else?
Mr. Chairman, I think it’s important to understand exactly what these financial assessments, the impacts… . Impacts on what? On the families or the revenue or the particular formula that… ?
Can the minister clarify that for us?
My second question, really, has to do with the review as to exactly who is responsible for doing that review. Is it a number of individuals within the housing corporation? Which particular manager is responsible for completing this work?
Yes, the financial impact has implications on both the government and our people out there.
So we’ve got to consider this very carefully. All the resources within the housing corporation have been looking at this, including the other government departments that have an interest in reviewing this.
When I say “interest,” it’s practically all the government departments have input into the review.
So is the minister saying to us that all the departments will have to have input into this exercise? Have they not been consulted enough? It really doesn’t appear to have gone beyond the departmental consultations.
What about the Nunavut public?
I believe these consultations have already been done.
I think it’s just a matter of deciding when to submit it for consideration. Could the minister be a little more specific when he said that he needs to consult with all the departments?
Is that not at your discretion?
The consultations have taken place.
As the president has indicated, we’re refining the impact and the numbers for submission. It has been very difficult. As you know, it involves Income Support, Education, and various other departments and it does have a major impact on the government and our people out there.
So we’re making sure that whatever comes out of this is going to be beneficial for all involved, including our clients at public housing.
We’re on page J-3. $28,841,000.
Details are on pages J-4 and J-5. Capital Expenditures.
J-3.
I have a couple of questions that are kind of directed to my opening comments from yesterday.
On page 2 of my opening comments, I mentioned that “there are approximately $18.5 million in rental arrears” throughout the territory.
I think it’s important to point out that LHOs’ accounts receivables are not much different than other businesses throughout Canada or the territory, and that they assume some bad debt.
In reality, not all rental arrears are collectable.
Each year, auditors visit communities to do audits on the housing associations and part of its audit is to work with the managers and TROs to review the accounts receivables to determine how much of the arrears are actually collectable.
My question is: of the $18.5 million in rental arrears, how much of this money is actually deemed collectable?
Mr. Chairman, the collection of arrears has proven very difficult for the LHOs.
That’s why, within the housing corporation, we’re trying to at least put some training courses on for the local LHOs to find ways to collect arrears.
The percentage of collection has been going up. It has gone up to 84 percent compared to last year, so there is improvement.
In some communities, there have been collections of over 100 percent. That means there are arrears being collected into the LHOs, so there is improvement showing and we hope to continue that.
I thank the minister for his update, but I don’t think he answered my direct question, which was: how much of that $18.5 million is actually not collectable?
I’ll have the chief financial officer respond to that question Thank you, Mr. Chairman.
We’re in the process of assessing that. We have hired a collections officer within NHC. Our first step was to tackle the options for payments and set up online banking, both things we haven’t had in the past, looking into credit bureaus and other ways of doing the collections.
We’re also taking the largest arrears that are owing to each of the LHOs and starting to look at that. So we don’t yet know. I mean for the audit, the $18.5 million is the bad debt reserve that’s on the books.
So that is what we are speaking to when we say “arrears.”
So from an auditor perspective, it’s deemed unlikely to be collected, but we are working to see what we can collect.
Anything else? Mr. Rumbolt.
Just for clarification, Ms. Kimball mentioned that the $18.5 million is the reserve that was set up by auditors.
So is this reserve the actual arrears or is it a different figure?
I’ll have Ms. Kimball respond to that question.
From the audit perspective, anything over 90 days of aging is deemed to be arrears and is deemed to be a reserve for bad debt as required.
So when we’re talking about the $18.5 million, we’re talking about what’s over 90 days.
Mr. Rumbolt: Thank you Mr. Chairman.
I have a different line of questioning now from what I was just doing.
I would like to ask some questions to the minister and his officials concerning the issue of Nunavut Housing Corporation’s management of construction contracts.
Under section 12 of the government’s NNI Policy, construction contracts will provide for bonuses and penalties in relation to Inuit labour content.
Can the minister confirm that the Nunavut Housing Corporation applies these bonuses and penalties to companies that have contracts to construct new housing units for the Nunavut Housing Corporation?
Can the minister or his officials explain how the Nunavut Housing Corporation monitors compliance with labour content provisions in construction contracts?
The Nunavut Housing Corporation follows the procedures and guidelines of the NNI Policy as well as the general conditions of the standard Government of Nunavut contracts. Those are the ones that were developed by Community and Government Services.
Contractors submit, as part of their bids, commitments for labour and non-payroll items.
As well, as part of their submission, they identify which of those components they would like to be considered for bid adjustments in terms of Inuit content, local content, and Nunavut content.
At the end of the contract, based on the information submitted by the contractors, we look at their actual performance against the commitments that they had made in order to get preferential treatment.
There are a number of different mechanisms involved and one is a minimum Inuit payroll content, which is set for every contract based on activity that is taking place in the community and workforce availability. If that number is exceeded by the contractor, there is a bonus provided of 1 percent for every percent above the minimum that they achieve.