Thank you. Committee, we can proceed to a clause-by-clause review of the bill. Does committee agree?
Agreed.
Thank you, committee. We will defer the bill number and title until after consideration of the clauses. There are 60 clauses in the bill. We will consider clauses in groups. Please turn to page 10 of the bill.
---Clauses 1 through 39 inclusive approved
Mr. Thompson.
Thank you, Mr. Chair. I move that Bill 45 be amended by adding the following after subclause 40.1(5):
(6) On appeal under subsection (5), the Director of Corrections may confirm, quash, or reduce any period of separate confinement imposed by the adjudicator.
Thank you, Mr. Chair.
Thank you, Mr. Thompson. A motion has been made. The motion is being distributed. Ms. Green.
Thank you. The Director of Corrections wanted to retain the ultimate authority over discipline in the correctional facility, which we understand. What we have here is an independent adjudication process. It will receive oversight by the Director of Corrections, but the key phrase here is that the director "may confirm, quash, or reduce" the periods of separate confinement, but he cannot or she cannot increase it. So this is a way to meet the needs of both the independence of the adjudicators and the need for the correctional facility to retain the ultimate authority over separate confinement. Thank you.
Thank you, Ms. Green. Minister Sebert.
Thank you, Mr. Chair. Cabinet will be supporting this motion. Thank you.
Thank you, Minister Sebert. Any further questions from committee? Seeing none. The motion is in order. To the motion.
Question.
Question has been called. All those in favour? All those opposed? The motion is carried.
---Carried
Thank you. To clause 40.1 as amended, does committee agree?
Agreed.
Thank you.
---Clauses 40 through 60 inclusive approved
We will now turn to the bill number and title. Bill 45, Corrections Act. Does committee agree?
Agreed.
Thank you, committee. Does committee agree that Bill 45 is now ready for third reading?
Agreed.
Bill 45 is now ready for third reading as amended. Does committee agree?
Agreed.
Thank you. Committee, does committee agree that this concludes our consideration of Bill 45?
Agreed.
Thank you. Thank you, Minister, and thank you to your witnesses. Sergeant-at-Arms, please escort the witnesses from the Chamber. Committee, we have agreed to next consider Committee Report 29-18(3), Standing Committee on Economic Development and Environment Report on the Perceptions Held by Northern Business toward the Government of the Northwest Territories' Procurement Process. I will go to the chair of the Standing Committee on Economic Development and Environment for opening remarks. Mr. Vanthuyne.
Thank you, Mr. Chair. In August of 2018, the standing committee conducted a survey focused on procurement-related policies and processes. This survey was undertaken in response to concerns that had been raised by various business owners and operators. Committee received responses from businesses of all sizes, representing a wide variety of industry sectors from the Beaufort-Delta, North Slave, and South Slave regions of the NWT.
Northwest Territories businesses raised various issues amongst which conflicting policies and practices were a key concern. For instance, businesses note that the government's lowest bid rule and standing offer agreements may conflict with the intent of the Business Incentive Policy. Collaboration between government and vendors is another key concern of business. Multiple local businesses felt disadvantaged in the competition for contracts with government because they saw a limited understanding of the unique situation of northern businesses reflected in the government's invitations to tender.
The feedback received by committee shows that Northwest Territories businesses have concerns focused on four key themes: first, increasing consistency, clarity, and transparency in the procurement system; second, attracting local vendors more effectively; third, understanding NWT business capabilities better; and fourth, integrating mechanisms and services to contribute to the successful delivery of the contract.
Mr. Chair, committee would like to thank all those who participated in the survey for sharing their experiences and providing substantial recommendations. At the appropriate time, I will have motions to move the recommendations. Thank you, Mr. Chair.
Thank you, Mr. Vanthuyne. I will now open the floor to general comments on Committee Report 29-18(3). Mr. Testart.
Thank you, Mr. Chair. The subject matter of this report is near and dear to the hearts of the business community in my riding of Kam Lake. I am regularly copied on e-mails from many businesses who are involved with government procurement, expressing their frustration around procurement practices. I have raised many of those issues on the floor of this House, asked questions in question period. Unfortunately, the answers received often ended in "We don't have problems with procurement. We don't have problems with BIP. We will explore options, but we think everything is fine." That didn't sit well with me, and I don't think it sat well with my colleagues on the Standing Committee of Economic Development and Environment.
As we were in a position to take the initiative and pursue some areas of study on our own because no legislation was coming forward, this was a top priority of the committee to do its own independent research on it. That started by directly reaching out to stakeholders who interact with the government's procurement and supply system and ask them what they thought of it. It wasn't just Members. It was actually constituents, business owners, Northerners. The results are contained in this report.
I think it is a very good report. Not only did we go straight to the people who are most concerned, we ensured anonymity to allow truthful, honest answers without fear of reprisal, and we had a very excellent expertise analyze those results and put it into a very clear narrative. Anyone can pick up this report and read it and see exactly what our business community thinks about our system. That is a very useful tool. I am very thankful of our chair and of my colleagues on the committee for bringing forward this work.
The two substantive recommendations made in the report are other issues I have brought forward, as well. They haven't had much uptake from the Minister responsible or the government. I hope that a response is provided and we can actually move forward. No one is going as far as to saying the procurement system is broken. What is being said is that it needs improvement. Any system needs improvement.
My mind turns back to a common problem with public procurement in Canada and other western democracies where a decision was made to shift procurement away from expensive, government-owned procurement sources and go to the private section with an interest of driving down cost for taxpayers. Largely, procurement policies that are trying to reduce cost to the taxpayer have been successful, but we have maximized that efficiency. We have gotten the cost down to as low as it possibly can be. What we aren't looking at is how to maximize benefits to our local economy and to northern businesses. That is something that we have some policy clarity on, but it is murky as to how it actually operates and how it benefits.
I think in our government's case in particular, we need to focus on that economic development piece more so than reducing the costs to government, especially when our economy is downturned and hasn't recovered since 2007. It is not going to recover unless we provide some much-needed stimulus. The efforts to date, the great amounts of infrastructure spending, aren't making a big enough difference to get our economy back on track and restore prosperity to the Northwest Territories.
We have to look at other tools. Members have proposed procurement as one of those tools for stimulus. It simply hasn't happened. I hope the 19th Assembly will heed these lessons, follow the discussions and debates of our Assembly, and look at the recommendations in this report and make much-needed improvements to how procurement works in the Northwest Territories. Thank you, Mr. Chair.
Thank you, Mr. Testart. Next on the list, we have Mr. Simpson.
Thank you, Mr. Chair. First, I would like to thank our staff for putting this together. The committee had the idea of doing this report at a time when there wasn't too much of a workload. Soon after that, we received probably the biggest workload that any committee has received since the division of the territory. I was a little concerned this might fall to the wayside, but somehow, our staff managed to analyze the responses from the 19 different businesses and put it into a coherent report. I really appreciate that, and I really thank them for that.
I want to thank the businesses, as well. As the Member mentioned, we did reach out to businesses. I went to businesses in my constituency who had brought procurement concerns forward. There wasn't a lot of uptake on the survey. That is because people have given up providing information to government, I guess, because they respond to these surveys. They go to the meetings and express their concerns and nothing seems to change. I had to do my best to convince them that we are not the government, we are the Legislative Assembly, and that this was a way to help bring their concerns forward and get them down in writing.
This report is written in a way that is very civil. A lot of the responses that we received weren't that civil. There was some colourful language in some of them. That just shows that there was a lot of frustration bubbling up because people felt like they weren't heard.
I think that this is going to be valuable going forward. I really believe that the appropriate people in the Department of Finance and ITI and Infrastructure need to take a look at this just to inform themselves moving forward. I think that those who are incoming to the next Assembly should pick this up, as well, and read it so they don't have to hear the complaints over the course of a number of years to understand what is going on. They have it right at their fingertips.
Once again, I just want to thank everyone involved. I am hopeful that this document will help improve the system and bring some more benefits to Northerners. Thank you, Mr. Chair.
Thank you, Mr. Simpson. Any further questions? Mr. O'Reilly.
Thanks, Mr. Chair. I, too, would like to commend our committee and staff for the work that was done. I have had concerns raised with me about procurement practices here in the Northwest Territories. When some of these issues have been brought to the floor, the Minister hasn't been terribly receptive. I guess committee felt that we just couldn't wait any longer for anything to be done.
We had a retreat in Norman Wells. Certainly, I said to the committee, "Look. If we are serious about this work, we have to do something about it." A survey was conducted, and I'm glad to see this work come out for the public to see, as well.
For me, what I've seen is an increasing trend towards large P3 projects, public/private partnerships. These are very complex arrangements, very difficult to understand, large amounts of money involved, but there doesn't seem to be any Northern benefit requirements built into the contracting or the arrangements that are put in place around these.
Stanton renewal, the new hospital is in my riding, and I was hearing complaints about the lack of jobs, training, and apprenticeships for Northerners. I think that is something that we need to focus very clearly on. I had hoped that the report would draw that out a little more clearly but, of course, it really reflects what we heard. Certainly, one of my main concerns is ensuring that we build in Northern benefit requirements into these large infrastructure projects, particularly P3s, so that there are Northern employment, training, apprenticeship requirements.
I do want to compliment the Minister of Infrastructure. I think it was Infrastructure or Finance. Last week, talked about the work that is going to be undertaken on the Tlicho all-season road. He said that there were going to be northern benefits requirements. I've asked him for more information on that. I'm looking forward to getting it tabled in the House before the end of the sitting, but that's an example of what we can and should be doing.
I hope that our Cabinet colleagues will take this report and its recommendations in the spirit in which it's offered to improve our current approach and policies and practices, and actually take some action on them. Thank you, Mr. Chair.
Thank you, Mr. O'Reilly. Next, we have Mr. Vanthuyne.
Thank you, Mr. Chair. Further to my opening comments, I just wanted to add a few more remarks. We recognize that this government is rather large, and it spends big sums of money. It does it through a number of various departments and projects. It does it in a number of various forms; public tenders, requests for proposals, standing offer agreements, and even sole sourced opportunities. As my colleague from Frame Lake mentioned, we are starting to delve more and more into P3 contracts.
I think what's important is that we recognize that each one of these areas has its own numbers of challenges, and that we simply have to start to accept that there are these challenges and admit, first of all, that they are, in fact, hindering small business; and further admit that we need to review these policies and processes. That's essentially been the ask from a number of Members throughout this four-year term, is to say, look, we're telling you that this is hindering small business. We need to collaborate and work with small business and various enterprises to get this right.
Essentially, what you're going to hear at the appropriate time later today is that we want to see a collaborative process with industry in improving these procurement policies and processes, and essentially taking on a review of them so that we can improve them, and get back to utilizing them in the way in which they were intended. While I appreciate the government has its own interest in terms of how it needs to spend its funds in the best interests of the public at large, there's also got to be a degree of understanding that a lot of local economy relies on government spending, so we've got to do it the right way. Thank you, Mr. Chair.
Thank you, Mr. Vanthuyne. Next, we have Mr. McNeely.
Thank you, Mr. Chair. I recognize the work that went into the report on how to improve or design or review the practices done in the procurement department.
Over the course of my term, one of the biggest concerns I heard from the business community in our area is on the timely submissions or replies to the RFPs or RFQs or tenders that went out there because they had to submit their tender package in the mail, or couriered to the district office or the regional office. That resulted in some cases of a loss to the business, that they couldn't get their bid submission in on time. That was eliminated by having the Department of Infrastructure after it merged with Transportation and PWS to setting up a permanent regional office in Norman Wells, and I've never received a phone call since. That tells me that something is working, and these tender packages or tender opportunities that are submitted by the largest supplier in the territory in the absence of industry, we have heard many times, or I have heard many times, government that's stable, government that's here, government's not going anyplace, and we can rely on their opportunities for services and capital projects.
At the same token, the concerns were self-evaluated and self-addressed by most of the business communities saying, we, too, have to meet the government halfway and have competitive rates to fall within the budgets that have been set in these different projects, taking into account multi-year, seasonal access, and some unforeseen designs that may occur from project-to-project.
On the basis of the procurement process and taking into account also the provisions that we have in our land claim which addresses the opportunities of negotiated contracts and sole source contracts as per the land claim agreement, and as well as the negotiated contract policy and sole source and policy, the opportunities are there. The policies are there. The system is designed to help. Now, we've just go to educate the business community. We have to be cost competitive, and we also have to take into account best value for dollar, and the safety and schedule of the project. We don't want to encourage the operator to run a high-risk work environment that may result in termination of the project if there was a site audit conducted by the Workers Safety Commission Board. Those are additional factors taken into account, but as far as I can see, the system is there. It's working. It may need a little tweaking applicable to the various regions that are out there. Different regions have different cost methods and different access of supplies needed to complete the project. Those are my comments there, Mr. Chair.
Thank you, Mr. McNeely. Next, we have Mr. Thompson.
First of all, I'd like to thank the committee for taking the opportunity to get out there and look at this issue and come up with a report.
My big concern, and I've heard this from numerous people in the southern part, is that some regions get negotiated contracts, and other regions do not; especially on the big projects. They are really concerned about that. I've seen two projects in the south that would have cost $17 million for two projects that went down south. Limited, and I mean limited employment, and it saved the government $982,803.41. That's what it saved the government. The government was willing to let $16,645,870.60 go down south. There may have been a little bit of work for Northerners there, but limited.
Again, what we are seeing is depending on what region you are in is where the program is going, and where the negotiated contract is and sole source. I think that government needs to be looking at how it has an impact when we are offering these big contracts. If we don't spend the money in the territory, we are going to see companies leave. With the cost of living, they can't afford to do it.
That also, then, means that jobs are going to go away. If jobs go away, social income becomes more prevalent, which has an impact on families. It saddens me that this government doesn't see this. They see the bottom line. They see some money being saved, and that's all it is.
When I talk to businesses in the riding I represent and companies in the south, they are very concerned. The economy is going bad in the south, so we are seeing contractors from down south come up with their own accommodations, their own food, their own fuel, and hiring limited people working on projects. You see companies from up here watching these people doing the work that could have been done by us.
Again, I would like to thank the committee for the work that they did in getting the surveys out. From my understanding, there were 19 responses. I think that the committee did a great job, and they have some good recommendations moving forward. Thank you, Mr. Chair.
Thank you, Mr. Thompson. Any further comments from committee? Mr. Vanthuyne.
Thank you, Mr. Chair. I move that this committee recommends that the Government of the Northwest Territories establish a procurement advisory panel composed of members of industry, small business, procurement experts, and members of the public service; and further, this panel should be guided by a clear terms of reference, setting out the panel's role in providing regular advice to the government on how to improve procurement processes. Thank you, Mr. Chair.
Thank you, Mr. Vanthuyne. The motion is on the floor and is being distributed. I will just give it a couple of seconds here. The motion is in order. To the motion. Mr. Testart.
Thank you, Mr. Chair. A procurement advisory panel, I think, is an excellent way to ensure that all stakeholders engaged in the procurement process are at the table and able to provide some degree of oversight advice and recommendations to government on how to improve procurement.
As Members of this Assembly, we are not always subject matter experts, and it is always, I think, prudent to give subject matter experts an opportunity, and who better to lead than procurement experts, industry, and public servants, as well, who are all involved in the system.
This idea is not a new concept. It exists in our neighbouring territory of the Yukon. In the Yukon, it began as a temporary committee; it only had a limited lifespan. The idea was, "Give us some recommendations; we'll make some fixes, and then your time is done." That panel was so useful to the Yukon government in improving procurement that it became a permanent panel. This motion contemplates skipping a pilot, if you will, and just going to establishing a full panel.
I think that there is a lot of merit to this, especially if they do have a very clear terms of reference so that they are not waiting. It doesn't become a dispute panel or politicized in any way. It is just focused on very clear advice on how we can make things better, and independent advice, which I think is a really important piece here. We have heard, in the debate on these issues over the years, that the real issue is not the procurement system needs some improvement. It's that contractors don't understand how it works, so as long as we do a trade show or workshop and teach people how to interact with government, we will solve all of our problems, and I don't think that that is correct. I think that that is only part of the equation. There is much more to this.
To really get at the meat of it, I don't think that one motion on the floor of the House is going to fix that, but a panel that exists permanently and can make these kinds of ongoing recommendations over the years, that is where we can start finding these solutions, at arm's-length, with full independence, and providing that kind of fearless advice to the Minister and the government on how these things can improve.
I think that this is an excellent step forward, and I thank the committee for bringing it forward. I do support this motion. Thank you.
Thank you, Mr. Testart. Next, we have Mr. Simpson.
Thank you, Mr. Chair. I will be supporting this motion. I think that it is a good idea. The notion that there are no issues and no improvements needed with the procurement system seems to be institutionalized within the relevant departments. If we have a panel like this, and we stand up here and ask questions, the Minister won't be able to say that there are no concerns, because I am sure that such a panel would bring forth the concerns, and if they are not acted on, that's not an excuse. If there are no concerns, it would just be that they are ignoring the panel's concerns. I think that this will be an excellent tool, and I hope that a future government implements it. Thank you, Mr. Chair.
Thank you, Mr. Simpson. Any further questions or comments from committee?
Question.
Question has been called. All those in favour? All those opposed?
---Carried
Mr. Vanthuyne.
Thank you, Mr. Chair. I move that this committee recommends that the Government of the Northwest Territories undertake a comprehensive public review of all procurement-related policies with the explicit direction to modernize government procurement process and to ensure that NWT businesses can benefit and a healthy private sector is developed in the NWT, taking into consideration concerns and issues raised in this report, along with the committee's recommendations. Thank you, Mr. Chair.
Thank you, Mr. Vanthuyne. The motion is on the floor and has been distributed. The motion is in order. To the motion. Mr. Vanthuyne.
Thank you, Mr. Chair. Really, this is the real request that we have tried to make of the Minister and the government all along, essentially saying that, you know, it is time that we recognize that, while there might be these one-off circumstances that the department and the Minister might be able to improve upon and help and fix, there are just too many out there that have been identified, time and time again, through the various departments and through the various forms of contracting that we undertake, and that, you know, on numerous occasions in this House, in various forms of statements and questions, we have asked the government to undertake this, and we felt at this time that it is time to put this into a recommendation in the hopes that the forthcoming government will undertake this initiative and do the necessary review. Thank you, Mr. Chair.
Thank you, Mr. Vanthuyne. To the motion.
