Thank you, Mr. Ramsay. The Member for Yellowknife Centre, Mr. Hawkins.
Thank you, Mr. Speaker. I’ll have questions for the Minister of Education, Culture and Employment. The question I want to bring up today is about schoolyard safety.
One of the schools in my riding, which is Mildred Hall School, has a fire hydrant right in the middle of the playground. The children can’t play soccer or play baseball without safety concerns.
From my research, no school in the Northwest Territories, or even Alberta, has this type of safety problem. Actually, it’s beyond ridiculous that the children have to worry about this. In a situation where we have declining physical activity with children, we must find ways to encourage, not discourage, children from playing and being part of activity.
So my question for the Minister of Education, Culture and Employment is simply this: Would he be willing to agree today to look at trying to find a financial solution to this particular problem, because it isn’t a heavy capital issue but it is one that should be paramount always before our mind: the safety of the children and making sure that they’re active in their own ways.
So will the Minister work with the school board to find a financial solution to this problem because they don’t have the money? Thank you.
Thank you, Mr. Hawkins. Minister of Education, Mr. Lafferty.
Mahsi, Mr. Speaker. This is an issue that was just brought to my attention just now. So I will commit to working with the school board to find a solution. Mahsi.
Thank you. I appreciate that answer. I’m not sure I want to screw it up by asking another one and getting him to retract it. But does the Minister see a possibility of working on the solution within the next few weeks so we can build it into the upcoming budget?
Recently the Department of Education has taken back about $400,000 from this school board. I know the Department of Education – we don’t need the exact dollar – turns back money every single year to the Department of Finance, and I know they’re always happy to get that money back.
So what I’m trying to get at is: Does the Minister see if he can get this plan in action immediately, because it’s robbing the kids and we want to make sure we can get it in the window of this upcoming season of construction.
Mahsi. Those are the discussions that we need to have. I don’t have any information in front of me pertaining to this. My department needs to sit down with the school board and find out the details of the issues that may be before us. It’s not only our department but Public Works and Services that we have to work with when it comes to infrastructure. So that discussion needs to happen with the school board. Mahsi.
Thank you, Mr. Lafferty. Ms. Bisaro.
Thank you, Mr. Speaker. My questions today are addressed to the Minister of Lands. I’d like to follow up on his statement about establishment of the liabilities and financial assurances division.
Some questions have been asked already by other Members about security for development in the NWT. I’d like to ask the Minister first, in general, does the department have an approach, do they have a policy in regard to the value of security that is required for development? Is the security required equal to the value of the remediation or is it a percentage of the value of remediation? Thank you.
Thank you, Ms. Bisaro. Minister of Lands, Mr. McLeod.
Thank you, Mr. Speaker. My understanding is that the security amounts are set by the board and that it would normally consist of whatever it may cost to remediate the site. I’d have to confirm that, but I know the amounts are set by the boards. Thank you.
Thanks to the Minister. The Minister’s statement stated: “Security provides additional protection to ensure that there are funds to address environmental liabilities if proponents fail to take remedial action.” That’s definitely a statement that I can agree with and I’m very glad that that’s in there. I do have a bit of a difficulty in that if the amount is set by the board and yet the government is supposed to do the monitoring and enforcement, if the number is not enough for remediation, there’s a bit of a gap in there.
I’d like to ask the Minister how the assessments are made. He says that they’re made by the board, but are they made in house? Does the department assist the board when they are making those assessments for security?
Earlier in response to questions from Mr. Bromley, I believe, the Minister mentioned that they were in negotiations with a particular development to establish a security. So I’d like to know how these assessments are made and my point is we need to have them as accurate as possible. Thank you.
Thank you. I’ll have to admit that I’m not quite sure how the assessments are made. All I know is they are made by the board. I’m sure there’s a lot of work that goes into them, once they make it and we negotiate with the proponents as to the instrument that they will pay and then we hold that security. Thank you
Thanks to the Minister. The Minister also mentioned in his statement that we are working on short- and long-term policy development concerning the government’s management of securities. I would hope that the manner in which assessments are done would be part of that consideration. Certainly the other day there was quite a consideration of the difference, or the statement that we are using security bonds as opposed to irrevocable letter of credit.
I’d like to ask the Minister, and he may not be able to give me this answer today, but I would like to know from the Minister what the difference is between a security bond and an irrevocable letter of credit and why is it that we have decided a security bond is acceptable as security.
Thank you, Mr. Speaker. A surety bond is what we have accepted in this particular case. It is a bond that is covered by three major insurance companies, and the proponent would pay a premium on that insurance. It’s in effect until we release our interest in it. It’s a very powerful instrument to use. It’s one that’s used widely across the world, my understanding, and it’s one that’s acceptable under the Waters Act, and it does carry a lot of weight. It’s covered by multinational insurance companies, and it is one that we’re using in this case. What that does is it also frees up some capital that the developers can put back into their project, which could add as long as 10 years on to the life of some projects and the jobs that would continue to provide. It is a very strong bond and it is acceptable in development.
Thank you, Mr. McLeod. Final, short supplementary, Ms. Bisaro.
Thank you, Mr. Speaker. Thank you to the Minister. Thank you for correcting me. Yes, I meant surety bond, so thank you for understanding what I meant.
I guess my concern is whether or not the department has looked at situations where a surety bond has had to be used. I appreciate that the reasoning that it frees the company up for capital as opposed to having a letter of credit, which is cash.
Can the Minister, if he has not or the department has not, look into previous situations or situations that exist anywhere in the world where a surety bond has had to be called on and how effective it was in providing the funds necessary for remediation of a site?
We do have a list of instances where it’s been used in the past. I think as we go forward with this, what I need to do is, I need to sit down with the committee that oversees Lands. I need to give them a briefing so we all have a better understanding of the differences between a surety bond and a line of credit. I will commit to doing that at our earliest convenience. We do have examples of where it has been used in the past.
Thank you, Mr. McLeod. Mr. Hawkins.
Thank you, Mr. Speaker. I’d like to return to one of my favourite subjects, and that’s direct appointments. As we’ve all heard at length repeatedly over the years, my concern that they’re not publicly accounted for and whatnot. Rather than spending a lot of time, let’s go straight to the Minister of Human Resources and get right to the bottom.
What type of public reporting does the Minister see is available for the public to know how many direct appointments we are doing, how often do we make them, and what departments receive them? Let’s just start off with some simple questions like that.
Thank you, Mr. Hawkins. Minister Beaulieu.
Thank you, Mr. Speaker. We have that information. We do advise committee on the amount of appointments that we’ve done over each government. I believe that the last time the committee asked, we had provided them with information on the amount of direct appointments that we had done at the Cabinet level.
If it’s provided to committee, of course, as we all know through the various channels, levels and scrutiny we receive, of course, every piece of that information is confidential. What public reporting can be done on this particular subject?
Direct appointment is a unique tool that this government uses to fill positions, and if the committee feels that it would be important for this to be reported in a manner to the general public and if committee has ideas on how we would be able to report that to the government, then we would be open to listen to that.
I appreciate the answer from the Minister. Is the Minister saying that if he had a sharply worded letter from committee that supported this initiative, the government would jump on it?
Yes, we would consider it, depending on what information they wanted to release. I believe that we could probably talk about the various priorities, but I think some of the information would remain confidential. If the committee has ideas and it was to write to us asking us what they wanted released for what purpose to the public, then we would consider that.
Thank you, Mr. Beaulieu. Final, short supplementary, Mr. Hawkins.
Thank you, Mr. Speaker. I want to be very clear on the record. I think that there are cases and reasons why we do direct appointments, and I am certainly not against all of them by any means. I want to make sure that’s absolutely clear. I’m only about public transparency, and that’s really what it comes down to. Frankly, my question, lastly, for the Minister of Human Resources would be: Minus the recent devolution transfer of appointments – because some of them, if not all of them, had to be considered direct appointments – what type of direct appointments are we talking about that have fallen under this government in the last three years?
There are various reasons: supporting career development for long-term employees, supporting advancement of employees who have successfully completed formal training, advancing career development of affirmative action candidates outside the public service, addressing unique challenges with a particular job competition such as when recent recruitment practices indicate an open competition would be unproductive in resolving an undesirable work situation such as marriage between two individuals in the same departments.
Thank you, Mr. Beaulieu. The Member for Weledeh, Mr. Bromley.
Thank you, Mr. Speaker. My questions today are for Minister Miltenberger and Finance. I have questions about the P3 contract we are proposing for the retrofit of Stanton Territorial Hospital.
I am worried that it may not be the best deal for the people of the Northwest Territories. Research indicates that failure rates are high, that they amount to a huge transfer of tax dollars to private financers, and buyout of P3s are becoming more common. Because it’s politically expedient to defer expenses and avoid debt, the government is essentially renting money rather than borrowing it more cheaply on their own.
I’d like to ask the Minister why has he chosen this justly maligned model for a project so important to the well-being of our citizens as the retrofit of our territorial hospital.
Thank you, Mr. Bromley. The Minister of Finance, Mr. Miltenberger.
Thank you, Mr. Speaker. We have looked at this carefully. There is a process. There are a number of considerations that are there. The public interest is paramount. The value for money must be demonstrable. Appropriate public control and ownership must be preserved. Accountability must be maintained and all processes must be fair, transparent and efficient. We’ve put this project through the rigour, for value, for money, a review, and we looked at it because we are required to under our P3 policy, anything over $50 million, and we are of the opinion that we can demonstrate and have demonstrated that, well, as the Member indicates, it’s a much maligned process that in this instance seems to be something that’s very, very worth considering.
Thanks for the Minister’s response. I’m sure all the other jurisdictions that have had such failures have similarly done the analysis and so on. A 2012 study of 28 Ontario P3 projects worth more than $7 billion found that public-private partnerships cost an average of 16 percent more than conventionally tendered contracts. That’s mainly because private borrowers typically pay higher interest rates than governments. Transaction costs for lawyers and consultants also add about 3 percent to the final bill, and of course, private financiers are looking for a large return on their investments.
Specifically, what are the checks and balances the Minister refers to that makes our P3 project so different and so safe, from Cabinet’s perspective, and it will protect us and the public from the 16 percent-plus cost penalty typical of such an approach. Mahsi.
Mr. Speaker, from my time in government, it has been my experience that there is no particular construction project that is ironclad and failsafe anywhere. So, are there challenges with the P3? Yes. Are there challenges with other processes? Yes, there are.
We have a management framework for P3s. We have some of the best finance people in the world that are looking at this and they are very, very capable people that have delivered, time and time again, good budgets, that are very knowledgeable. We have the Public Works department that has a lot of skills in terms of overseeing projects, and in spite of the very many challenges, we have managed some fairly substantial projects over the last few years, if I look at the Inuvik East Three School, we’ve worked our way through the bridge and we are now fully engaged in delivering the Tuk-Inuvik highway on time and on budget all with separate and different approaches to the construction.
So I wouldn’t be so quick to write this off. I know there are some concerns in some quarters, but we believe that we had the rigour on this and the very thorough review, and we’re making the case that we should be considering this. Thank you.
Thanks to the Minister. You know, many times I’ve heard my colleagues, and I myself have asked the questions, what are the specific challenges that the Minister mentions and what are the specific safeguards in response to those. Once again, the Minister said, we’ve got great people working on this. So again, I hope the Minister will make that clear to the public and to the House.
Mr. Speaker the RFP for the Stanton rebuild has just been made public. The list of jobs to be privatized is growing. In addition to maintenance jobs, we now know help desk services, plant services, waste management services, road and ground maintenance, parking management, pest control, security and surveillance and laundry and linen services are to be privatized. In recent years catering and housekeeping were also privatized.
How is the increasing privatization of public service jobs possibly considered good for the economy of the Northwest Territories, the delivery of critical health care and the expected employees? Mahsi.
Mr. Speaker, what is critical and what is going to be good for the Northwest Territories and all the people living here is that we’re going to have a $350 million project that’s going to give us a state-of-the-art health centre, that’s going to come in on time and on budget, that’s going to be 40 percent larger than it currently is, it’s going to provide us some of the best services, it will be our flagship acute care facility for the next 30 years or so, and it will be done in a way that we make sure, in fact, the staff complement at Stanton is going to grow. Yes, there are some potential non-core services that may not be government jobs, but as part of the process, we’re looking at it and no final decisions have been made. But what we have to focus on is this is a very, very much needed project and it’s going to give us a facility that’s going to serve us well into the future. Thank you.
Thank you, Mr. Miltenberger. Final, short supplementary, Mr. Bromley.
Thank you, Mr. Speaker. I do appreciate the Minister has a vision. Again, some specifics would help us get on board with that.
What are the checks and balances in response to these challenges that are out there? If there is a fair chance that this P3 initiative will fail, based on vast experience nationally and internationally, as we saw with the Deh Cho Bridge boondoggle and so on, but most notably with the building and retrofitting of hospitals in other jurisdictions such as Ontario, what is this government going to do? What is this government doing to ensure we have the fiscal capacity to bail out the Stanton Territorial P3 projects, again, such as many other governments are doing now? What is our fiscal capacity? How is the Minister assuring we have the resources to bail us out if need be? Mahsi.
Mr. Speaker, first let’s just look at the bridge. Yes, it had some issues as it was built, but it has won, subsequently, all sorts of awards. I have talked to a lot of people about the bridge and I’ve asked them all the same question and there is always the same answer. Given some of the critics about the bridge and the dislike for the bridge and they don’t like how it was done and what it looks like, would you all go back to ferries and ice roads? It’s an unequivocal 100 percent no way. We love being able to go in and out. We love the service and access that the bridge gives us. If you consistently call it a boondoggle, we have a piece of infrastructure… I’ve been in Edmonton where they have overpasses that cost more than that bridge. It’s a great piece of work.
We have experience with hospitals, not to the magnitude of this one, and the Member has made up his mind that once again it’s going to be the process. He will say that this is a good project; he just doesn’t like the process, like many things. We will have to and we will demonstrate, we have demonstrated, that there is value for money here and the P3 process is one worth considering. Thank you.
Thank you, Mr. Miltenberger. Mr. Menicoche.
Thank you very much, Mr. Speaker. I wanted to ask the Minister of Transportation about the policy about ferry closures at this time of year. It’s very stressful for all the residents that are on the ferry system. I had a couple of calls from residents of Fort Simpson that indicate there was a bit of confusion this year.
I would like to ask the Minister, what policy does the Department of Transportation have for notifying the general public about ferry closures? Thank you.
Thank you, Mr. Menicoche. Minister of Transportation, Mr. Beaulieu.
Mahsi cho, Mr. Speaker. What we use is the average of the last 10 years as a time when we indicate when the ferry will close. The average in the last 10 years on the one ferry, the Liard ferry, was November 3rd, so we advised the public that it would be closed anywhere within 72 hours because we thought that was taking us to November 3rd. However, we try to keep the ferry open as long as possible, as long as it is safe to continue to run, so there may be extensions added to that if the ferry is still running safely across the river. Thank you.
The particular case I’m talking about is Fort Simpson. Apparently, the depth sounder wasn’t working properly, so the staff said, oh look, we have to close tonight. I think that was on Sunday, but the depth sound meter wasn’t working properly. Then the department advised the public and then they opened up the next day for 12 hours on Monday, then Tuesday they said they’re doing daylight hours. It is really confusing for the residents of Fort Simpson and the businesses, so they were quite confused.
Once again I would like to ask the Minister what specifically happened in the case of Fort Simpson ferry closure this year.
That vital piece of equipment that the Member refers to was not working properly at the time. We had that piece of equipment repaired and it started to work. We recognized that the depth was still sufficient to run the ferry, so we extended the ferry operations.
As I indicated, we feel that we try to run the ferry as long as possible so that is why there was a little confusion to try to keep the ferry open, although we indicated earlier that we thought it would be closing sooner. Thank you.
