Debates of October 15, 2004 (day 21)

Thank you, Mr. Braden. Mr. Roland.

Thank you, Mr. Chairman. Item 9, the $35,000, money was forwarded on the basis of a language program. A contribution agreement was put in place with the Department of Education, Culture and Employment. On the Metis Heritage Association of $84,000, that was again to do with cultural organizations, oral traditions. It was applied for in that manner and funds were doled out. For more detail and the actual flow-through, we could go to the Minister of Education, Culture and Employment for more detail. The one thing I should say is, as the Member stated, we are dealing with occurrences that happened back in 1998. For the detail, that may be available and Minister Dent may be able to provide some more. Thank you.

Thank you, Mr. Minister. Mr. Dent.

Thank you, Mr. Chairman. There’s not a lot that I can add to this that hasn’t already been provided, either in response to Mr. Menicoche or by Minister Roland just now. The programs are programs of the department that are application-based. They weren’t special programs. The issue is one of vigilance. You are always going to find once in awhile an agency that will go out of business owing money. You can’t ever have 100 percent certainty. We are fairly confident that procedures have been tightened up now so that the changes of it happening again are reduced. In terms of why this happened, I can’t really say. I can say the person who was responsible for approving the payments is no longer with the department. The policies and procedures have been tightened and we will endeavour to make sure we see this happen as seldom as possible

Thank you, Mr. Dent. Mr. Braden.

Could the Minister give a little more history on these files? Over what period of time were contributions made? Was this a one-year occurrence or were there multiple years involved and what were those years? Thank you.

Thank you, Mr. Braden. Mr. Roland.

Thank you, Mr. Chairman. Mr. Chairman, the situation with the Metis Heritage Association, the first funding started to flow in 1997-98 and then a further contribution in 2000-01.

For the Metis Nation on the language contribution, it was 1998-99. Thank you.

Thank you, Mr. Roland. Mr. Braden.

Okay. So 1997, we are really going back. We are going back seven years. It seems to have taken a long time to bring that piece of work forward for management here as a write-off.

Does the department have all the documentation related to these files here, including the loan or contribution made to the Metis Nation, as well? Is all our documentation in place there? Because of the nature of these two organizations, obviously they’re related. The nature of the contribution and the request of the project are obviously related. Was there any crossover here in terms of the board of directors or the staff?

Thank you, Mr. Braden. Mr. Roland.

Thank you, Mr. Chairman. Mr. Chairman, as stated earlier in the previous item that we’d looked into here, when organizations put their applications in I’m sure the proper paperwork was done and put in place. It comes back to the fact that the accounting portion of what was done with that money is the area we run into problems. The Member has raised one point that we’ll clarify; there was on both the Metis Heritage Association and the Metis Nation issues some crossover in the sense of directors. So there were some crossovers of individuals who served on both boards. Thank you.

Thank you, Mr. Roland. Mr. Braden.

I guess to the aspect of accountability, Mr. Chairman, the Minister offered that the staff person who would have made these decisions is no longer at the department, and I don’t want to suggest that I or committee is out here on a headhunting expedition. It’s not our practice to bring forward the names of staff or go in that kind of direction. In the area of accountability, when things like this go off the rails, to what degree -- Minister Roland has talked to us about a third-party accountability framework -- are we going to be holding our own people accountable for the monitoring and oversight of these files, where the total amount that we’re looking at here for this year’s debt write-off is just over $400,000?

Okay. You’ll have to coach me here. Mr. Chairman, I move we extend Committee of the Whole until we conclude Bill 9.

---Laughter

How was that?

I don’t think you can do that at this moment in time. We’ll check with the Clerk’s office and see how we may proceed from here. That was all that was up. The word from the Clerk’s office is the motion is in order to extend until we conclude Bill 9. So what is the wish of the committee?

Agreed.

Okay. Continue, Mr. Braden.

Thank you, Mr. Chairman, and thank you for the advice on procedure here. To the aspect of accountability and how we hold our own staff and our own officers accountable for these programs, I want to reiterate, Mr. Chairman, I’m not engaging in seeking out or searching out individuals. However, on a go-forward basis, what levels of accountability will be contained in our new third-party accountability framework that will hold our own people to the task of watching and monitoring and reporting on these contribution programs? Thank you.

Thank you, Mr. Braden. Mr. Roland.

Thank you, Mr. Chairman. Mr. Chairman, first of all, I just want to put it on record that the reference Mr. Dent made to the individual who worked on this file no longer being with the government, there was no direct relationship between what occurred on the file and that individual being with our government. Just to be sure on that portion. Now, the third-party accountability framework portion is more the relationship that we would set up with the organizations from a government perspective to an organization receiving money. It’s not the relationship between an employee working in the department and how they would account for a review of a file. That continues to be the internal workings of our departments and how they deal with their human resources. If there’s a lack of understanding there or a process or ability to do the work, that has to be dealt with internally.

On the third-party accountability framework, once again, that deals with the government relationship with the organization accessing the funds. We’re strengthening that and making it clear what we expect out of that partnership that would be formed when an organization requests funds from us. So there’s that portion and, unfortunately, in any situation that we have, again it’s when we come to this portion that we have to look at how we got to this and that’s why this question process is a good one. We’ve seen at times there can be many good proposals brought forward to the table, that make sense, fit the program, and funds advanced in that situation. If an organization goes defunct within that year or in the year that they receive those funds, then it becomes more difficult to try to get the accounting for those funds and what those funds were used for. That’s what we find from time to time.

The more problematic one, I think, is when we do have an experience with an organization that has received funds and not accounted for it and seemed to have got more funds. We do put that on the table so it’s open to Members of this House to see that, and that is why we are going in the direction we are about strengthening our position as a government when we deal with organizations that receive funds from us. Thank you.

Thank you, Mr. Roland. Mr. Braden, anything further?

Thank you, Mr. Chairman. Okay, I’m still looking internally here. The Minister has said, if I follow, that any kind of accountability or if we’re going to hold our own people to account for their performance, if their duties are to watch and monitor and take suitable action on files, if they fail to do so then what kind of provisions do we have in our agreements or our contracts or our performance measures with them to see that they’re held accountable? I’ll leave it at that. Thank you, Mr. Chairman.

Thank you, Mr. Braden. Mr. Roland.

Thank you, Mr. Chairman. Mr. Chairman, we have, as a government, processes in place to deal with our employees that are required to do a certain job. They have to fulfill those requirements and have to be competent in doing that. So each department follows those guidelines and whether it be one supervisor dealing with an individual or if it’s right up to the deputy minister or the Minister, there is a process in place about how we would deal with our employees. It’s very clear and agreed to by the unions. So that process we follow.

In all of this stuff, let’s be real; there is the human element of all of this and how one individual would deal with another and how they report that, whether it’s first a verbal warning, a written warning, to a suspension and so on. There is always that process and it has to be clearly followed. At the same time, I have to qualify that by saying there is that human element in there and we can all be guilty of acting human from time to time, whether it’s in the right way or the wrong way. That’s a fact.

Our processes are in place, we are confident in those processes and we try to adhere to them through the whole process, but because there are so many departments, so many individuals, there are things we need to do to make sure we are all following the same interpretation. That’s another area we are working on as a 15th Assembly to strengthen that part of the organization. Thank you.

Thank you, Mr. Roland. Mr. Braden.

Mr. Chairman, I am going to ask one more question with regard to this and I think I have had my share of time on this. On the accountability factor, we’ve been discussing the onus that is on our people, on our staff, our officers, but I am also wondering about the onus that is on the politicians. The ability or opportunity, sometimes the temptation that there might be for a politician or Minister to apply influence on a certain application is a well-known part of how government and politics operates. It’s a test of our system. To what degree do our processes guard against that kind of thing or are able to resist it? I wonder if any one any of these files here, is there any information at all that politics may have had to do with overriding the need for a contribution to have been accounted for before a new one was authorized? Thank you, Mr. Chairman.

Thank you, Mr. Braden. Mr. Roland.

Thank you, Mr. Chairman. Mr. Chairman, we have no information that would bring that into question, if there was political pressure when these things were going forward to make things go away or just deal with it. We feel there are processes in place today that would take that into consideration. If a Minister were to try to put undue pressure on one of the deputies in saying we want to see this one flow through, we have a system in place where the deputies are reporting directly to the Premier. There is a reason for that separation. If I, as a Minister, were to try to put undue pressure on my senior staff, they can go to the Premier and say this is not appropriate. Here is the advice and this is the way things should flow.

As well, I think the next piece of what we do on the political front, whether it’s a Minister or a Member, is that we have the ethics portion of our duties and the Ethics Commissioner and a Conflict of Interest Commissioner. We have to adhere to those policies. If not, then you take your political life, as one would possibly describe it, and put it in jeopardy. Hopefully Members are very aware and familiar, as I am sure we all are, of the processes in place and the need to adhere to them.

Thank you, Mr. Roland. Thank you, Mr. Braden, for your questions. Mr. Pokiak.

Thank you, Mr. Chairman. Mr. Braden pretty well asked all the questions, but I would like to pursue it a little further.

---Laughter

I am referring to items 1, 2, 3, 8 and 9. Again, they are all unaccounted contributions. You gave pretty good explanations previously, so I won’t pursue that any further. The question I have is when we talk about accountability, I think that’s the key thing that has to be dealt with, especially when we start invoicing the companies that have to make payments. I think it’s the responsibility of the Minister to ensure his staff are accountable to get this done. You mentioned earlier that there are ways to do that, but once a person gets a loan, it’s very important that your department ensure that the staff is on the ball to make sure that collections are being made. Thank you.

Thank you, Mr. Pokiak. Mr. Roland.

Thank you, Mr. Chairman. Mr. Chairman, I guess first of all, we would hope we wouldn’t be to the point where my department was called into the picture, because that is when things have gone really bad and it’s collection time. Each department would be in charge of how they deal with the organization that received a contribution. In the initial stages, we want to keep that relationship going in a positive way.

The other part of it is from our side, the policy is quite clear on what needs to happen and the process we follow. I think that’s why we also hold our senior staff accountable for how those policies are being worked into the system. Granted, again, there are times when a file, whether a letter went out and when it was received back, when the next call was made or how long between calls, when you can do further follow-up, as we stated. In this case of debts being written off, it doesn’t release the individuals from the debt and we continue to monitor. Depending on the file workload, there could be some time between the checks that happen, but they are being followed to the best of our abilities that we have within resources we operate in and our environment. Thank you.

Thank you, Mr. Roland. Mr. Yakeleya.

Thank you, Mr. Chairman. Mr. Braden indicated there was over $400,000 being written off this year. Is this a trend that this government is doing in terms of writing debts off? Have you seen this trend from the past few years around this figure? Thank you.

Thank you, Mr. Yakeleya. Mr. Roland.

Thank you, Mr. Chairman. Mr. Chairman, first of all, when we look at the amount of $411,000, it is a substantial amount and that is why we try to improve on the way we get things done and the third-party accountability framework and how we work with our own staff and that process.

This has not been a growing trend. It fluctuates from one cycle to the next. For example, in 2000-01, the total amount for write-offs was $2.6 million; for 2002-03, it was $134,000; in 2003-04, $162,000. The total amount we are looking at for 2004-05 is in the neighbourhood of $500,000. Thank you.

Thank you, Mr. Roland. Mr. Yakeleya.

Thank you, Mr. Chairman. It seems that it’s a bit of a rollercoaster here in the Northwest Territories in terms of debt write-off. Does the department have an analysis of expected risks for this year or next year in terms of debt write-offs? Can you crystal ball in terms of what may be expected next year and the potential development in the NWT? In going into business and some ventures, there is some degree of risk. You go through the process of having trust in the organization. Personally, I lend money out and I am not 100 percent sure it’s going to come back. Sometimes you have to cut your losses and it’s not a good feeling. You know the person you are going to lend money to is hoping to pay it back. Is there a percentage that we expect to lose, a minimum for each year? Thank you.

Thank you, Mr. Yakeleya. Mr. Roland.

Thank you, Mr. Chairman. Mr. Chairman, we do not build into our fiscal framework or plans a loss percentage, I guess you could say. We don’t have that. What we do count on is departments coming forward to us on a yearly basis saying that these files, whatever they would be, are doubtful now and we don’t think we can receive any funds back in those areas. At that point, we would put it into the system and the departments would build into their budget process a loss as it comes down to it and we follow through with the process we are at today. On an annual basis in budget planning cycles, we have not built in a percentage of loss we might see because it fluctuates quite a bit, as I have just stated, from $2 million to $100,000. It could go back up again. It all depends on how things work out in that year and if we have some big losses. Thank you.

Thank you, Mr. Roland. Mr. Yakeleya.

Thank you, Mr. Chairman. My last question to the Minister. I will look forward to the Minister bringing information forward to the committees in terms of the best methods of recovering money and also money that’s been given out to the organizations. In their hearts and their minds…For some odd reason, something went wrong. There are some safety mechanisms and more preventative measures in terms of catching these past learned lessons and having more successful recovery of the various contributions that go out to individuals. We need some safety checks or coaching or a checklist that the government would be more successful in recovering these dollars and accountability is brought back into the system. Thank you.

Thank you, Mr. Yakeleya. Mr. Roland.

Thank you, Mr. Chairman. Mr. Chairman, there is work underway and if there is further clarification needed for members or as we proceed forward and get the next piece of the work done, we will gladly share it with members as how things are flowing. We have shared the third-party accountability framework that we have begun to implement, as well as the processes that are in place that we have built in. As the Minister of Education stated earlier, the flow of funding on a quarterly basis instead of giving it all upfront is one of those areas. It is difficult. On a yearly basis, we can contribute millions of dollars to organizations out there, some as small as $5,000 to $10,000, and in other areas, $1 million plus. So that really does affect how we go from year to year. But as we stated, we are working on improving our accountability, not only for ourselves but for the people of the Territories to show we are accounting for the money that’s going out there. Thank you.

Thank you, Mr. Roland. Any other comments on schedule 2? Agreed?

Agreed.

To clause by clause, schedule 2?

Agreed.

Back to the main clauses. Bill 9, Write-off of Assets and Debts Act, 2004-2005, clause 1.

Agreed.