EdinburghNLP/nunavut-hansard-plusplus huggingface dataset:
I would like to thank the members for asking some good questions. I would like to acknowledge my officials here with me, David Akeeagok in particular, Brent Boddy, Mike Rafter, Shawn Maley, and Susan Makpah and it was her first appearance in Committee of the Whole. I would also like to thank Silas Angna’naaq.
I would also like to thank your officials for providing responses to our questions.
Sergeant-at-Arms, please escort the minister and her officials from the witness table.
We will proceed with the Minister of Finance’s opening comments, followed by the comments of the chair.
Bill 23 – Appropriation (Operations & Maintenance) Act, 2008-2009 – Consideration in Committee – Finance
Hon. Louis Tapardjuk (interpretation): Thank you, Mr. Chairman. I am pleased to appear before you to discuss the 2008-09 Main Estimates and Business Plan for the Department of Finance.
Mr. Chairman, 2008-09 marks a year of change for the Department of Finance. A review of the department’s organization has been completed and the business plan before you today reflects the changes that have been made.
Some of the changes simply formalized existing reporting relationships. Other changes rationalize the divisions into three categories based on their objectives. Forward looking divisions are included under the policy and planning, current operations are included under financial management and because of its reporting and tracking functions, comptrollership is seen as more historical in nature.
Of course, each of these categories overlap to some degree. I am pleased to report that this enhancement to the department will support strengthening financial management without any negative budgetary impacts.
Mr. Chairman, 2008-09 will also be a year focused on growing partnerships and working together. As a central agency, finance will be managing the Affordable Energy Fund on behalf of the government while tracking direct and indirect energy subsidies.
In the coming months, we’ll be working with the Government of Nunavut departments to finalize fund operations.
I look forward to reporting back to the House once we have finalized the funding mechanism and parameters of the Affordable Energy Fund.
Members will have noted that our Liquor Commission has had a busy year.
There have been plebiscites in no fewer than six communities, and as a result at least two new Alcohol Education Committees have been formed. The government has recognized the growing need to address concerns related to the use of alcohol and has formed an inter-departmental working group.
The multi-faceted nature of alcohol in our territory means that the working group will be addressing the administration and sales and the responsible use of alcohol to penalties to people who abuse the system and programs for Nunavummiut are struggling with addiction.
Mr. Chairman, the 2008-09 the crown agency council will continue to refine its approach to providing support to all public agencies while enhancing our partnership with public agencies.
I recently tabled the 2007-08 letters of expectation to the territorial corporations.
Over the coming year, we will be working closely with the corporations to ensure due diligence by reviewing their quarterly financial results, hopefully including face to face meeting with each crown corporation.
In addition to strengthening our relationship with individual corporations, we will be replacing the current letters of expectation format with a more collaborative approach that more closely resembles the memorandum of understanding.
This will allow for greater understanding and more focused support of our territorial corporations. Mr. Chairman, working together does not simply mean working within government. We are continuing our work to develop meaningful policy and public private partnerships or P3s.
Mr. Chairman, in our research leading up to the development of Nunavut’s P3 policy, we realize that more research and discussion was necessary to craft a meaningful policy.
Staff from our department and the Department of Community and Government Services have just returned from a major national P3 conference. We will use the conference outcomes to guide our deliberations as we finalize this important policy.
We will continue to evaluate projects individually to maximize our resources and ensure that we do not miss out on opportunities to build our infrastructure. Mr. Chairman, we are continuing our efforts to strengthen financial management.
Working closely with the Department of Community and Government Services and with Indian and Northern Affairs Canada, we have finalized our proposal for this $23 million initiative.
We are confident that the project will receive federal Cabinet approval shortly and that we will be able to meet this year’s sealift deadlines.
Mr. Chairman, nowhere is our commitment to working together more apparent than in our initiatives related to Strengthening Financial Management.
We have made real progress on our project to essentially rewrite the Financial Administration Manual and have already held training workshops in each of the regions. We are also working towards the completion of our Financial Procedures Manual.
We see the standardization of procedures as an opportunity to engage GN employees from the corporate services division of each department and public agency.
In this way we are ensuring that there is adequate opportunity for input into the new policies and directives that clearly lay out the financial responsibility required across the Government of Nunavut.
Mr. Chairman, I will now turn to a brief overview of the department’s budget.
Finance has six branches: Directorate, Policy and Planning, Financial Management, Internal Audit Services, Comptrollership and the Centrally Administered Funds.
For 2008-09, the Department of Finance has been allocated $54.1 million in operations and maintenance expenditures, which is unchanged over 2007-08.
$19.7 million for compensation and benefits:
$30.6 million for centrally administered programs and costs, including:
$10 million for government-wide employee benefits such as dental premiums, workers’ compensation premiums, and employee medical travel;
$9.9 million for the lease costs of the Legislative Assembly building and other office buildings constructed by the Nunavut Construction Corporation prior to April 1, 1999;
$7.2 million for the regular Nunavut Electricity Subsidy Program;
$3.5 million for Government of Nunavut’s insurance premiums; and
$3.9 million for other operations and maintenance costs in the department.
In summary, the department’s focus for 2008-09 will continue to be the provision of central agency services in areas that include support for the Financial Management Board, managing the government’s overall fiscal position, and overseeing the financial framework and accounting processes.
I welcome questions and comments from members.
Does the Chairman of Government Operations and Accountability have opening comments?
I am pleased to provide you with opening comments on behalf of the Standing Committee on Government Operations and Accountability on its review of the 2008-09 Main Estimates and Business Plan for the Department of Finance.
The standing committee notes that the department’s proposed 2008-09 budget is $54,156,000.
The department’s budget has increased approximately 96 percent from its initial allocation of $27,548,000 back in 1999-2000.
The standing committee recognizes the role that the department plays as a central agency. One of the key functions that the department performs is supporting the Financial Management Board’s coordination of the government’s budget development process through the preparation of the annual main estimates, capital estimates and public accounts. In light of some of the things we have seen this year, I think some stronger steps will need to be made by the Department of Finance in the development of some of the budgets that get put into the main estimates.
Mr. Chairman, an issue with GN-wide implications that continues to be of concern to the standing committee is the growth in the size of the public service since the creation of Nunavut in 1999.
The number of PYs budgeted for 2008-09 year is approximately 3,614. This is an increase of around 574 positions, or 18 percent, since the beginning of the Second Legislative Assembly.
This growth is taking place even though the government’s overall vacancy rate remains around 20 percent. Although the GN’s most recently tabled employment statistics revealed that over 725 positions across the government are vacant, departments continue to add new PYs to their organizational charts.
The standing committee has been advised that the Financial Management Board has approved a new PY control mechanism to ensure that all PYs listed in departmental structures are fully funded. However, we must recognize that the bureaucracy cannot grow forever.
The government has budgeted over $335 million in 2008-09 for compensation and benefits for employees, an amount which accounts for over 31 percent of total government spending.
While it is important to fairly compensate our hard-working employees in a manner that supports our recruitment and retention goals, we also need to recognize that dollars budgeted for compensation and benefits for new positions are dollars that are not available for other spending priorities, such as capital projects in communities, or increased financial assistance for young Nunavummiut to attend university or obtain other post-secondary qualifications.
Mr. Chairman, the standing committee has consistently called on the department to enhance the transparency and accountability of government operations through such measures as ensuring that the government’s financial statements are tabled within the timelines established by law, and expanding the level of detail contained in financial documents.
The standing committee is pleased to note, for example, that the government’s 2008-09 main estimates and business plans include significantly more detail with respect to the planned budgets and priorities of Crown agencies, with the exception of the Qulliq Energy Corporation.
However, the timeliness of tabling of a number of critical items remains a concern. For example, in June of 2006, the Minister of Finance tabled a comprehensive GN-wide report on grants and contributions made during the 2004-05 fiscal year. However, reports for subsequent years have not yet been tabled.
The 2004-05 Public Accounts were not tabled until March 8, 2007.
The 2005-06 Public Accounts were not tabled until March 6, 2008.
The 2006-07 Public Accounts have not yet been tabled.
The standing committee notes that the department’s 2008-09 business plan indicates that, “Federal budget 2007 also provided $23 million to Strengthen Financial Management in Nunavut. Of this, $15 million will be used to create an efficient and effective business computer network. The remaining $8 million will be used to strengthen the accountability framework and to facilitate the timely preparation of Nunavut’s Public Accounts.”
Mr. Chairman, the standing committee will continue to closely monitor progress in this area. Members are firmly of the view that it is important for our government to come to the devolution negotiation table with credibility and confidence.
Mr. Chairman, the 2008-09 Business Plan of the Department of Finance indicates that, “The challenges associated with recentralization are being evaluated to ensure that any future recentralization initiatives address concerns that were identified during the first phase.”
It also indicates that a priority for 2008-09 is to, “Continue to research the potential for further restructuring of financial transaction processing within a shared services model and the possibility of the creation of centres of expertise as recommended in the Auditor General’s 2005 Report and in the Review of GN Financial Structures Report dated April 2006.”
A number of reports of the Auditor General and this standing committee have recommended that the government review aspects of its decentralized financial management structure. The standing committee’s recent public hearings concerning the Nunavut Business Credit Corporation and the impact that its decentralized location has had on its operations have clearly highlighted the need for the government to realistically re-evaluate specific decentralization decisions that have not proven successful.
Mr. Chairman, during the fall 2007 sitting of the Legislative Assembly, a formal motion was unanimously passed in this House on the issue of the federal Northern Residents Deduction, which Nunavut tax filers are eligible to claim.
The motion called upon the Government of Canada to increase the residency portion of the Northern Residents Deduction and ensure that the residency portion be adjusted thereafter on an annual basis to an inflation index that is reflective of the high cost of living in Canada’s Arctic.
The standing committee was disappointed with the limited support that the federal government gave us on this initiative, a small step forward; I think it’s just a little percentage increase.
That’s a first step and the committee supports the efforts on behalf of all three territories in the north and their Parliamentary representatives in Ottawa to continue to lobby the federal government on the issue.
Mr. Chairman, the Department of Finance is responsible for administering the GN’s Fuel Tax Rebate program, which was announced in the 2006 budget.
The program provides incentives for mineral exploration and development, and provides for a fuel tax rebate for commercial harvesters and outfitters.
The 2006-07 annual report on the program was dated June 7, 2007. However, it was not tabled in the Legislative Assembly until March 4, 2008.
The standing committee looks forward to the continued tabling of annual reports on the program, which will enable all MLAs and the public to evaluate the success of the program in achieving its objectives.
In its response to a petition presented in the Legislative Assembly on February 3, 2007, the government indicated that: “[The Minister has] directed [his] officials in the Department of Finance to review the program and make the necessary changes to address the concerns.
The standing committee notes the minister’s recent statement in the House on this issue and looks forward to further progress in meeting this commitment.
Mr. Chairman, amendments were passed to the Payroll Tax Act in 2006. Concerns have been expressed by MLAs with respect to the ability of the GN to capture revenue from consultants and contractors who perform work on a contract basis for the Government of Nunavut.
The standing committee also urges the government to objectively measure the success that tobacco tax increases have actually had on reducing smoking rates in the territory, and to report its findings to the Legislative Assembly and the public.
The standing committee is pleased that the GN has begun the practice of tabling an annual report on its leasing activities.
The committee also looks forward to the department making progress on developing a formal policy for the use of Public-Private Partnerships (P3s). In his response to an oral question posed in the Legislative Assembly on November 6, 2007, the Minister of Finance indicated that a draft GN policy on the use of Public-Private Partnerships is “being prepared and should be presented to the Cabinet … before Christmas.”
The minister indicated that the Departments of Finance and CGS have been developing the policy. The standing committee looks forward to the policy being formally tabled in the Legislative Assembly.
Mr. Chairman, the issue of Crown agency governance is important. In 2003, the GN announced the establishment of a Crown Agency Council to address issues related to the GN’s relationship with its major Crown agencies and corporations.
The CAC’s annual activities report for 2006-07 was tabled on February 25, 2008.
On December 5, 2006, the 2006-07 Letters of Expectation to the Qulliq Energy Corporation, Nunavut Development Corporation, Nunavut Business Credit Corporation, Nunavut Arctic College and the Nunavut Housing Corporation were tabled in the Legislative Assembly.
The Crown agencies’ responses to their Letters of Expectation were also tabled in the House. However, Ministerial Letters of Expectation to Nunavut’s Crown agencies for 2007-08 were not tabled in the House until February 25, 2008.
The Letters of Expectation for 2008-09 have not yet been tabled. It is the standing committee’s hope that these be tabled at the spring sitting of the Legislative Assembly.
The standing committee will continue to monitor progress in this area, including such issues as the QEC’s compliance with direction given in respect to such matters as staff housing.
The committee also recommends that all ministerial directives, instructions, and other formal instruments directed to Crown agencies be tabled in this House in a timely fashion.
I also note that I think, right now, the Crown Agency Council is made up of just two people - the Minister of Finance and the Minister of Executive and Justice, and HR. That’s only two ministers that make up that council out of the four on paper.
The standing committee has noted that the GN has brought forward a new bulk refined petroleum products risk management strategy. This strategy will allow the government to use financial hedging instruments in its approach to purchasing fuel.
It is critical that the government be candid with Nunavummiut on this point.
On October 30, 2007, the Minister of Energy tabled a document titled “Ikummatiit - Government of Nunavut Energy Strategy.” On November 1, 2007, the provisions in the Qulliq Energy Corporation Act providing for the creation, finally, of an Affordable Energy Fund came into force.
The order announcing this was published in Part II of the November 2007 edition of the Nunavut Gazette. This fund, I understand, is to be managed by the Department of Finance.
The standing committee looks forward to monitoring the government’s implementation of this fund.
Mr. Chairman, the functions of the Nunavut Liquor Commission and the Liquor Revolving Fund fall under the jurisdiction of the Department of Finance.
Responsibility for the Liquor Licensing Board was transferred in 2007-08 to the Department of Justice.
Members note that the Department of Finance is planning to collaborate with other GN departments in undertaking a comprehensive review of the Liquor Act.
The issue of access to alcohol is complex and contentious, and members recognize that different communities have different views on the extent to which access should be permitted.
Members are also aware of the concern that in those communities where alcohol is permitted, excessive barriers to the legal importation and purchase of alcohol can result in the unintended consequence of people being driven into the hands of bootleggers.
For those communities where voters have chosen through plebiscite to establish Alcohol Education Committees, the standing committee supports efforts on the part of the department to provide training and support for these bodies, while recognizing the need to review whether their core mandate should be focused on controlling access or providing counselling services that might be more appropriately delivered by other entities.
>>Committee recessed at 18:36 and resumed at 19:09
Chairman (Mr. Evyagotailak): Welcome back. Minister Tapardjuk, do you have witnesses you would like to bring to the witness table?
Chairman: Does the committee agree to bring the witnesses in?
Sergeant-at-Arms, please bring the minister’s witnesses in.
To my left is my Deputy Minister, Peter Ma, and to my right is Chris D’Arcy, the Acting Assistant Deputy Minister.
Mr. D’Arcy and Mr. Ma, welcome.
Does this committee have any general comments?
I just want to make a slight correction. In my opening comments I had indicated that there were 725 vacant positions across the government and I just want to correct that.
That was as of March 31 last year and the latest one up to September is actually worse than that; it’s 818 vacant positions, not 725. I just wanted to clarify that.
I have no names on my list for general comments.
We will now proceed to the page-by-page review of the departmental estimates starting with page C-4.
Total Operations and Maintenance, to be Voted. $1,755,000.
Total Operations and Maintenance, to be Voted. $3,532,000.
As I indicated in my opening comments, I think it’s under this branch that supports the Crown Agency Council.
I’m just wondering if the minister could give an indication of what that council’s priorities are for 2008-09.
Hon. Louis Tapardjuk (interpretation): The Administrators and Directors of the Crown Agency Council have been given their Letters of Expectation for this year.
The Department of Finance would like to receive financial statements every three months.
So one of our main priorities for the upcoming year is that we would like to receive the Crown Agency Council’s financial statements on time and be reported.
We want to monitor them more closely this year, Mr. Chairman.
Mr. Chairman, the minister is the Chair of the Crown Agency Council.
I’m just wondering if he is of the view that the Crown agencies are fully complying with their Letters of Expectation and if any Crowns have not complied with direction given to them by their ministers.
Hon. Louis Tapardjuk (interpretation): They have complied fully with the Letters of Expectation we have sent them and we’re pleased with the way they comply with the Letters of Expectation.
Yes, we’re satisfied, Mr. Chairman.
I know the 2008-09 corporate plans for the Housing Corporation, the college, the Business Credit Corporation, and the Nunavut Development Corporation have been tabled in the House.
I’m just wondering if the minister can indicate why the Qulliq Energy Corporation’s 2008-09 Corporate Plan hasn’t been tabled.
Hon. Louis Tapardjuk (interpretation): I will have my deputy respond to that question, Mr. Chairman.
I believe that this is actually an annual question that’s asked by members. The reason for the delay in getting the 2008-09 Qulliq Energy Business Plan is because their board typically approves their business plan after we have gone through the GN’s business cycle. We expect to be receiving their business plan shortly so that we can table it by the time we get to the May sitting.
I think I stated in my opening comments, I think there are only two ministers on that Crown Agency Council.
If I can just get the minister to, for the record, indicate which ministers sit on that council.
Hon. Louis Tapardjuk (interpretation): The Premier and I are on the Crown Agency Council.
We are currently looking at how we can increase the number of members sitting on the council.
We are concerned about this and we are discussing how we can improve the system, Mr. Chairman.
I know the council has been working to finalize the governance model for public agencies. Can I get an update on the status of that initiative?
Hon. Louis Tapardjuk (interpretation): I will have Mr. D’Arcy respond to that, Mr. Chairman.
We’re working on that on two fronts now to finalize a global governance model that we can use as a template for territorial corporations that they can align their governance models with, but also through a new discussion or a new agreement with our territorial corporations, through a Memorandum of Understanding, which will clearly lay out the roles and responsibilities between the government itself and those territorial corporations.
That, in itself, will actually go a long way to strengthening our ties with respect to governance between the government and the territorial corporations.
I know that in the department’s business plan, it indicates that a priority for 2008-09 is to “Continue to research the potential for further restructuring of financial transaction processing within a shared services model and the possibility of the creation of centers of expertise” as the Auditor General recommended in her 2005 report.
In addition to the recent transfers of positions from the Departments of EIA and Health and Social Services to the Department of Finance, what other options are being looked at?
Hon. Louis Tapardjuk (interpretation): I will have Mr. Ma respond to that.