EdinburghNLP/nunavut-hansard-plusplus huggingface dataset:
The Qulliq Energy Corporation has an existing Staff Housing Policy that is not exactly similar to the Government of Nunavut Staff Housing Policy and they have been following that and it has been developed for some time.
This is one of the areas where we as a Crown Agency Council has begun to work with all public agencies to try to make sure that the policies that the Government of Nunavut has and the policies that public agencies have are very similar, if not exactly the same where those policies are applicable.
I was surprised the light did not go that way when I called Tootoo.
Mr. Peterson: Thank you, Mr. Chairman. I thank the minister, Mr. Victor Tootoo.
Just to follow up on that, when does the minister expect the Qulliq Energy Corporation to fall in line with all of the Government of Nunavut’s policies?
We have met once as a Crown Agency Council with the Board of the Qulliq Energy Corporation and had a very open and frank discussion. What we will do with that board and with the officers of Qulliq Energy Corporation is to look at all of their policies and compare them to ours, like we are going to do with the other public agencies.
It is not necessarily given that all public agencies will follow all of the Government of Nunavut’s policies.
It does not make sense, for example to have a small corporation like NBC adhere to all the restrictions under the financial administration manual given that they only have a handful of employees and they would probably double their employees just to make sure that they have the same amount of controls.
So, what we are intending to do, in the work of the Crown Agency Council, is to review existing policies in public agencies and to attempt to rationalize those with the Government of Nunavut’s policies.
We will have a report on where those policies differ and whether or not we think these policies should be changed.
That we will provide to the government for a decision and once the government has reviewed that report, then I believe it will be open for discussion.
I thank Mr. Tootoo for that information.
Can Mr. Tootoo give us kind of an idea of when that work will be completed and ready for us to review?
The work of reviewing the policies is going to begin immediately after this session is finished and go over the summer. I imagine that sometime this fall we would have a draft report ready for Cabinet and FMB to look at through the Crown Agency Council. I am not sure how long after that that information would be provided.
Chairman: Thank you, Mr. Tootoo. Mr. Peterson.
I think we certainly look forward to seeing that in our standing committee when it is available to review.
I wanted to, I think this is probably the right page, to talk about the work that the expert panels and the Advisory Panel have been doing for the Government of Nunavut on their territorial formula financing and the deadlines extended for them to complete the report until the spring. Does the Government of Nunavut have an idea of what either one or both of the panels are recommending to the federal government with respect to territorial formula financing agreement?
With that I will recognize Mr. Vardy. Mr. Vardy.
The two panels are expected to report over the next fall.
We have had a lot of dialogue with both panels including briefings from the panels on what might be contained in the report. We are not privy to their final recommendations, but some of the common elements are likely to be recognition that the fiscal circumstances of the territories are very different from the provinces.
The circumstances are different across the three territories and there is general recognition that Nunavut’s situation is different than the others in that we are a new territory where we are trying to build up all the social and economic infrastructure of a new territory.
The latter category might not be best covered through the formula financing arrangement, but through other funding mechanisms.
I thank Mr. Vardy for that information.
I know the Premier told us that he has met with the Prime Minister a couple weekends ago to talk about Nunavut’s situation, they touched on the Territorial Formula Financing Agreement, I believe, and the Prime Minister said he is waiting the report of the Expert Panel.
I think we are all waiting for the report of the panels, like it is some kind of magic bullet that is going to save us. I am just wondering, is the information you gave him, is it being seriously considered by the panels? I do not know what recommendations you told them or gave to them, I am not sure what the territorial governments gave to him, but you said you are getting a little bit of positive feedback.
I am looking for a little bit more clarity or certainty that what is contained in the reports of the two panels is not going to be the status quo; it is going to be an improvement over what we have now. Can the minister comment on that?
I cannot comment with certainty as to what is going to be in the report. We think they are going to be quite positive for Nunavut. I think there will be arguments that we can use very strongly in Ottawa.
Until the reports come out, we can not really say with certainty as to what is going to be in there. The intimations that we are getting is that they are going to be both good reports for Nunavut, good for the three territories, but we will just have to wait and see what is in the reports when they come out.
Will those reports be made available to Members of the Legislative Assembly when they are released?
And again, through a back door tabling process so we do not have to wait until June, if it comes out before June, which is hopeful.
If they come out during a period of time when we are not sitting can we get the minister to commit that we will receive copies to review?
My understanding is that they are being translated into Inuktitut right now and they will be public documents.
Finance. Branch Summary. Policy and Planning.
Total Operations and Maintenance. $3,914,000. (interpretation ends) Do you agree?
Chairman: Finance. Branch Summary.
Financial Management.
Total Operations and Maintenance. $3,108,000.
I had a question about liquor revenues. I’ve asked this question a couple of times over the last two years about the possibility of using some of the liquor revenues to be diverted into treatment programs for substance abuse programs, as well as programs for fetal alcohol spectrum disorder.
Is that something that the Government of Nunavut has ever considered? Or will consider?
No, it’s not something that we have looked at so far, but it is quite possibly something that we could look at some time in the future.
I think we’re hearing a very public cry for help from all the communities in Nunavut who need help with social disorders that are related to alcohol, and of course the standard answer from the government is that we have limited resources.
Here is a perfect opportunity to use some of the revenues that we generate from alcohol sales to assist the organizations in the communities that are traditionally under-funded.
I can speak with a lot of certainty about the situation in Cambridge Bay, that they offer a lot of alcohol treatment programs.
Just the other day, they alerted me to the fact that they are understaffed, and under resourced, but they’re doing the best that they can. There is a huge need in my community for these kinds of programs, and the government just doesn’t have the resources to help them.
So I’m wondering if I could get a firmer commitment from the minister that he will work with his staff and colleague from the Department of Health and Social Services to study, and I don’t take two years, but I think within the immediate future, within the next three months to look at a way of using some of the revenues from alcohol sales to help with alcohol treatment programs, and programs related to FASD.
Yes, we will look at it in the very near future.
I wanted to ask as well, I think this is the page, about how the Fuel Tax Rebate was calculated.
I’m not sure in my mind how you arrived at the calculations. In the fuel tax background you said that it would be approximately a $1 million per year rebate to hunters and trappers, fishermen, and mining companies.
So I went online and checked the annual projected fuel consumption of some mines. They are in the range of 40 to 50 million litres of fuel for different types of fuel, but overall a huge amount of fuel.
When I did the calculations, it seemed to me that you would be looking at more than a $1 million rebate annually to all these organizations and entities. I wonder if the minister or his staff could assist us in understanding how the calculations are completed.
The exact percentages for the Fuel Tax Rebate calculations haven’t been set.
The government’s commitment on how much it’s willing to rebate has been set and an interdepartmental working group has met and I expect that recommendations will be going forward to the next FMB meeting with the information that the member is asking about.
I thank the minister and Mr. Tootoo for that information.
Could you clarify for me then if the $1 million is the maximum that the government will rebate to any applicant in any one fiscal year?
Hon. David Simailak: Mr. Tootoo can answer that.
No, there isn’t a set maximum per year per applicant for that.
My understanding is that the options that are being discussed will amount to approximately $1 million on the current set of volume for those types of purchases, but that FMB will be provided with the complete list of options and calculations, in terms of percentage rebates, and the information on the mining activities and I’m certain that our minister would be happy to discuss those with the members once they have made a decision.
I thank Mr. Tootoo.
I guess I’m just a little bit concerned in my mind that he announced the Fuel Tax Rebate without understanding the full implications.
I know you mentioned in the fuel tax backgrounder that there’s a $1 million rebate, but that translates into $3 to $4 million in annual revenues.
What you are alluding to right now tells me is that you haven’t fully fleshed out the program so you don’t really know how much the rebate would be or conversely, how much the return to Nunavut will be by offering this Fuel Tax Rebate Program.
Mr. Tootoo. Okay, thank you.
The member is correct that we don’t have all of the administrative details of the rebate program worked out.
Whenever you provide an economic incentive to try to stimulate economic activity and strengthen the tax base, you’ve got to make certain assumptions. You don’t know with 100 percent certainty what’s going to happen and as the member alluded to a big mining operation certainly would have a rebate much greater than $1 million.
If that were to take place and this rebate helped stimulate and spur that development to take place, the economic benefits would be far greater than that. We did, in some scenarios, based on working with the Department of ED&T where we came up with some numbers, but we will have to monitor that program and see what the impact will be once the developments start taking place.
Right now, Nunavut is judged to have the most regressive mining tax regime in the country and this measure works and attempts to try to bring us more in line with the regimes in other jurisdictions, many of whom have the same type of incentive in place.
Mr. Peterson: Thank you, Mr. Chairman. I thank Mr. Vardy for that information.
I understand what you are saying. We have to attract investment and I am one of the biggest advocates for attracting investment in Nunavut. I would just like to know what we have given up to attract investment and what it is going to cost.
Again, reading your backgrounder, and I do not know if it is potentially misleading, or someone erred in writing it, it says the introduction of fuel tax rebate will result in approximately $1 million annually in fuel tax rebates for the mining sector. To me that implies that that is how much it is going to cost, that is our upper limit.
It is not going to be $2 million, or $5 million, or $10 million.
It is going to be $1 million. So I wonder if the minister could clarify for us what that sentence means, is it going to be $1 million, that’s it, it is not going to be any higher?
Yes, that number, $1 million is an approximate number right now, it is going to depend entirely on the level of activity in Nunavut in the years to come, the more activity there is, it could be higher, and a loss can allot on what kind of rules and regulations we put in place along with that rebate program.
That is work still in progress, so we are saying with the level of activity right now we are saying approximately $1 million annually.
Another thing that has puzzled me by the fuel tax rebate backgrounder, it is written here that the mining sector argues that Government of Nunavut’s fuel tax places an unfair burden on the industry. It says funds raised through the fuel tax are used to fund the structure and maintenance of roads and other infrastructure used by fuel consuming vehicles.
I was wondering if the minister’s officials could comment: does the Government of Nunavut have a system or process where they can track taxes that are raised from mines?
Can they track them through the convoluted system of the Government of Nunavut to the end? Would it be fair if we say that those dollars are used to construct roads or provide maintenance on roads used in our communities?
The convoluted system, I guess the member is talking about the fuel tax system; we can track a lot of things through the system. There is information, for example, on the corporate tax side on every company in Nunavut, and if we wanted to get tax information even finer than that on individuals, we can get that information from the CRA, but we have never done that.
We have done it on the corporate side. We had detailed information on the taxes paid by the specific mining companies in the territory, when there were mining companies and we could track the impact when some of those mines closed down.
On the Fuel Tax side, I am not sure how fine the detail we can provide, but I imagine we have it by each vendor, so we could track it if we wanted, yes.
Mr. Peterson: Thank you, Mr. Chairman. I thank Mr. Vardy.
So what you are saying ultimately you could tell me that taxes collected from, lets say, Tahera Corporation are being used to construct roads in Cambridge Bay, is that what you are saying?
Revenues coming into the Government of Nunavut come in from a variety of sources, we can tell what those sources are and if we spent enough time analyzing we could break it out quite finely. We also have expenditures that are allocated for different purposes.
With the reference to the roads in Cambridge Bay, that would be through the budget of the Department of Community and Government Services, and it would be through the municipal grants, along with the municipality’s own source of revenues would be used to fund the capital project. The direct connection that is alluded to in that press release is not followed in any practical application that I’m aware of in the system.
It could be done, but it would take a bit of work and I don’t know if it would be a beneficial use of time.
Chairman: Thank you. Mr. Vardy.
I thank the minister and Mr. Vardy.
I agree it’s probably not a beneficial use of time. It’s just that when these statements are made, it implies that that’s what’s going on; the mining companies, obviously thinks that’s what’s going on. I’m not sure how they have that kind of information.
Did any mining companies make representations to the Government of Nunavut to do studies and reports to support their contention that road tax would place an unfair burden on industry?
There was representation to the Government of Nunavut from mining companies and a lot of positive feedback since the announcement was made. A lot of that information has been communicated to our minister’s office.
Another interesting thing I noted, too, it’s in a newspaper that Mr. Tootoo, Mr. Victor Tootoo, too many Tootoo’s in the building, there’s something called a development participation agreement.
I wonder if Mr. Tootoo, the minister, or Mr. Vardy could comment on what a development participation agreement is.
The development participation agreement is designed to make sure that if the mining companies are able to avail themselves of the tax rebate we offer, then this government has the ability to ensure that the mining companies are furthering the objectives of this government, mainly in the areas of Inuit employment and training and those kinds of things.
Mr. Peterson: Thank you, Mr. Chairman. I thank Mr. Tootoo and the minister.
I suppose my concern here would be the fact that the regional Inuit associations negotiate the Inuit Impact Benefit Agreements with the mines under Article 26 of the Nunavut Land Claims Agreement.
You have those agreements in place, which essentially covers everything that you just mentioned, so now you have another Government of Nunavut agreement that you want the mine to sign.
I am wondering how that development agreement is going to interface with the IIBA that is signed with the Regional Inuit Associations?
The member is quite correct that the IIBA has to be negotiated with the Regional Inuit Association, but the major difference is that it must be.
There’s no way around it for mining companies other than to go through that avenue.
With our fuel tax rebate, mining companies do not have to avail themselves of the rebate. It’s an option for them. So therefore, they don’t have to enter into a participation development agreement.
However, my understanding of the aims and the objectives of the IIBAs that the Regional Inuit Associations are concerned with would be very similar to the ones in our participation development agreements.
And as I said, the Government of Nunavut’s objectives are what those participation development agreements are aimed to address. They may differ slightly from the Regional Inuit Associations’ objectives, but they are along the same lines.
I thank the minister and Mr. Tootoo.
They envision the development participation agreements basically would be in a document that they sign. You don’t have to sit down and spend days, weeks, months negotiating; it’s just a standard document that they would sign.
And I know, talking to a lot of mining companies over the years, they detest red tape in bureaucracies. So I can’t see them wholeheartedly endorsing having to sign more agreements and hand them more conditions and terms or conditions they have to comply with if they’ve already got an IIBA.
I’m certain that the objectives for the government are standard and those objectives would be consistent regardless of which specific mining company we are dealing with.
So I’m certain there could be a standard format that we begin with, but as you know, each mining company is different, each actual operation is different and so they may request variations. And I guess the negotiation, if you will, and the red tape would be depending upon how different that mining company’s objectives are from what the standard Government of Nunavut’s objectives are.
You mentioned a lot of this discussion and setting the rules and the limits are going to be set by Cabinet.
I know Cabinet has a right to set regulations for programs, but I’m wondering why Members of the Legislative Assembly wouldn’t be given an opportunity to participate in the vote on the change to the income tax or to this program.
Hon. David Simailak (interpretation): Thank you, Mr. Chairman. This is how it’s set and it is standard and the Cabinet can enact it.
Chairman: Mr. Hunter Tootoo.
I would like to take this opportunity to welcome the minister and his officials to the Chambers.
I know, ever since the creation of Nunavut that Mr. Vardy has been no stranger to us, sitting in that chair and answering questions and confusing members at some times with his responses. And I know it seems like Mr. Tootoo is following in his footsteps there. Don’t follow too close is the only word of caution that I can pass on to him.
Mr. Chairman, my first question in this area deals with the taxation policies of the government. I know in the First Assembly, there were a number of amendments made to, I believe it’s our Income Tax Act, or I’m not sure of the exact Act that it’s called.
It allowed for improved credits to individuals throughout the territory for income tax purposes.
I think it’s done to recognize the higher cost of living in the territory and one of the other reasons behind some of the changes that were made in there was to try and attract corporations to set up offices in Nunavut by lowering our corporate tax rates.
One of the things I know has been a concern even before division that has become more prevalent since then and that is under the NNI Policy, there’s a requirement for northern suppliers and retailers for the government to go through those and it’s currently given to those individuals and companies that qualify under that program.
However, the problem arises when you have some businesses that have invested in infrastructure, whether it be a hotel or any kind of service industry, the retailers, and things like that that are trying to operate in an environment where you have your highest utility costs, the highest cost of operations, the same challenges we as the government face.
Then there are also lots of individuals or companies that are not real; storefront companies, they are just someone, I guess a supplier that just has a fax machine in a little office some place and gets all their stuff from down south. So they don’t have that investment of infrastructure here in Nunavut.
I’m just wondering if, as a department from the taxation point of view, if any thoughts have been given as a way to show our appreciation. Show our acknowledgement of the value that those businesses that have invested in infrastructure in the north, in Nunavut get some kind of appreciation for their cost of doing business; the high cost of utilities, power, and fuel, as we all know was something that’s eating up everybody’s money, including the homeowners.
So I’m just wondering: has there been any thought given to looking at any, from a tax perspective, options to try and address that investment and show an appreciation of that investment for those people in the territory?
That’s not an area that we have looked at seriously yet, but it is an area that we do need to look at that has been raised a number of times, not just in the House but by business people across Nunavut. It’s a comment I have heard a number of times over the years. It’s something that I personally experienced.
So it is an area that we do need to look at very seriously and find some way to deal with those so-called storefront operations and find some way to start giving a bit more credit to the bona fide businesses that are operating in Nunavut. Those who have been covering all of their costs, like you say, hiring local people, but it is an area that we need to take a look at somehow.
I can appreciate the minister’s response and maybe provide a suggestion.
Would the Department of Finance, within the taxation area, look at providing a tax credit to qualified businesses that have made an investment here to give them a direct credit on their Nunavut taxes based on a percentage of utility costs that they have paid throughout the year?
I know that all business have to file statements for income tax purposes and whatever amounts they have claimed they paid on their statements, if they were allowed to receive a direct credit, like a direct tax credit: a portion or percentage of that amount that they paid into the territory as far as for taxes and fuel.
Is that an option that the minister and the department would pursue looking at?
This government does have a power subsidy program in place for small businesses.
So that’s one way that we’re trying to support that.
In terms of tax credits for businesses in Nunavut, that is an area that we should look at and we will look it and see where we could go with it.
I appreciate the minister’s response to that and willingness to take a look at trying to develop an option like that.