Thank you, Madam Chair. I move that the committee recommends that the Government of the Northwest Territories make it public, as soon as possible, information on the steps, timeline, and the opportunities for public engagement for the review of the mining fiscal regime. Thank you, Madam Chair.
Thank you. The motion is in order. To the motion? Member for Frame Lake.
Thanks, Madam Chair. Yes, I just want to encourage that the department does get out some more information about what the next steps are. There was the PricewaterhouseCooper's study done in that was publicly released in October of 2020, and I understand there's some more work in progress. But what those next steps are and the timeline for them and how that's going to relate to regulation development, whether the regulations are going to cover a variety of topics like map staking, transparency, that's just not clear at all. And so I want to encourage the department, the Minister, to put out that roadmap so that it's available to everybody. Thanks, Madam Chair.
Thank you. To the motion?
Question.
Question has been called. All those in favour? All those opposed? Abstentions? Motion is carried.
---Carried
Member for Nunakput.
Thank you, Madam Chair. I move that the committee recommends the government provide a response to the recommendations contained in this report within 120 days. Thank you, Madam Chair.
Motion is in order. To the motion?
Question.
Question has been called. All those in favour? All those opposed? All those abstaining? Motion is carried.
---Carried
Thank you, committee. Do you agree that you have concluded consideration of Committee Report 21-19(2): Standing Committee on Economic Development and Environment Report on Government of the Northwest Territories Approach to the Mining Regime Fiscal Review?
Agreed.
Thank you, committee. We've concluded consideration of Committee Report 21-19(2): Standing Committee on Economic Development and Environment Report on Government of the Northwest Territories Approach to the Mining Fiscal Regime Review. Thank you.
Committee, we've agreed to consider Committee Report 23-19(2): Standing Committee on Government Operations Report on Review of the 2018-19 and 2019-20 Public Accounts. I will go to the chair of the Standing Committee on Government Operations for any opening comments. Member for Yellowknife North.
Madam Chair, the committee's report was read into the record on December 2nd, 2021. I do not have any additional substantive comments to add at this time. Individual Members may have comments on the report. I'd like to thank committee, the department, and the auditor general for their work on this report. Thank you, Madam Chair.
Thank you. I will now open the floor to general comments on Committee Report 23-19(2): Standing Committee on Government Operations Report on the Review of the 2018-19 and 2019-20 Public Accounts. Seeing no comments, Member for Yellowknife North.
Madam Chair, I move that this committee recommends the Department of Finance classify the project to refurbish Old Stanton as a public private partnership and report on it accordingly. Thank you, Madam Chair.
Thank you. Motion is in order. To the motion? Member for Yellowknife North.
Thank you, Madam Chair. I would ask that, you know, even if the government disagrees with this motion, they could try to explain what was going on. The auditor general told us that the Old Stanton was a P3, and the GNWT accountants disagreed. We had a battle of the experts going on in committee. And I don't know public accounting standards well enough, or the new P3 standards well enough, but to me when the Auditor General of Canada tells you something is away, according to the public accounts, you listen to them. So I would like to hear a bit more of a detailed response to this motion. Thank you, Madam Chair.
Thank you. To the motion? Member for Frame Lake.
Thanks, Madam Chair. So this project's actually in my riding, and it's something so I've been here six years and I've never really understood how we owned the old hospital and then it was given to somebody else to renovate and then we leased the whole thing back at a cost, and then we get it back at the end of the period when it's been rented to us for 30 years. I've just never really understood that arrangement. It just boggles my mind. And I don't understand why the government didn't keep the building, renovate it, and then we used it for longterm care and extended care, which is I guess the proposed use. I just never understood this. And I'm not sure I would if it was up to me, it wouldn't happen again. I'll just leave it that way. Thanks, Madam Chair.
Thank you. To the motion?
Question.
Question has been called. All those in favour? All those opposed? All those abstaining? Motion is carried.
---Carried
Member for Yellowknife North.
Madam Chair, I move that this committee recommends that the comptroller general enhance reporting in the public accounts of contingent liabilities arising from claims and litigation; and, further specifically,
A. Include a breakdown of claim amounts by category; and,
B. Identify individual claims above a certain threshold.
Motion is in order. To the motion? Member for Kam Lake.
Thank you very much, Madam Chair. Madam Chair, I support this motion. It was duly noted by committee that public litigation has gone up quite a bit for the GNWT over the course of the last five years. But we in committee have no way of knowing what is driving this. We're holding the government accountable, or really advocating for change for things that are really truly systemic. And so I support this motion and appreciate the conversation that committee had in regards to this. Thank you.
Thank you. To the motion? Member for Frame Lake.
Thanks, Madam Chair. So there's an interesting graph in the report by the committee, and it shows that, you know, from 2010-11, to 2015-16, the contingent liability amount in the public accounts was single digit numbers in the millions of dollars, and then it leapfrogged to $67 million, and now it's at $107 million for 2019-20. And I guess I have my own suspicions of what's driving this, but I think it's partly that the very complex P3 arrangements that our government is getting into. These are like a thousand pages of documents for each project. And I think it just leaves lots of room for this kind of stuff to happen. So I think we need to get to the root of this and try to better manage this moving forward. Thanks, Madam Chair.
Thank you. To the motion? Member for Yellowknife North.
Thank you, Madam Chair. Yes, I think having some public reporting on this is just a small part. We're being sued for $107 million. I have absolutely no idea. There is no public information about who or why that is. If we all of a sudden have $107 million show up in our budget, none of us are going to be happy. I suspect that a lot of this is from P3 legacy projects and contract disputes. I know there's some various class actions out there. I'm guessing really, based on news headlines, as to why we might all of a sudden owe $107 million.
Furthermore, I think the GNWT has absolutely refused to ever engage in any sort of transparency about settling litigation. I think they are overusing NDAs. I think in settlement agreements, they are refusing to disclose them. And it's not until maybe sometimes it's reported in either the public accounts or a budget that we catch that oh, we paid millions of dollars; oh, that we messed up a construction project and we had to settle for millions of dollars.
All of the information I have about this is currently found in the news, and none of it is available public anywhere. I believe our government needs to look at this and needs to take a transparent approach to when we settle litigation, why did it occur and publicly report on it. I think they are hiding behind it's before the courts or some fear of the rules, which is unrealistic and not being done in other jurisdictions. Thank you, Madam Chair.
To the motion?
Question.
Question has been called. All those in favour? All those opposed? All those abstaining? Motion is carried.
---Carried
Member for Yellowknife North.
Madam Chair, I move that this committee recommends that the Department of Finance undertake a review of their fiscal responsibility policy to ensure that the policy meets its objective for long-term fiscal sustainability.
And further, that the department provide the committee with an opportunity to comment on any proposed provisions to this policy. Thank you, Madam Chair.
The motion is in order. To the motion? Member for Yellowknife North.
Thank you, Madam Chair. You know, we talk about the fiscal responsibility policy but we've heard the Department of Finance say that our current spending is unsustainable. There's clearly a disconnect between making sure that the policy works. I think it is doing certain things. I know that it limits us to, you know, funding 50 percent of infrastructure through operating surplus and then we usually reach right up to the other half with debt. And I think this is actually just created a push to use P3s, because they are not part of that analysis. So I think it's having unintended consequences that are actually making us fiscally irresponsible. I think there's some huge questions about how we can create a policy to make sure that our government is fiscally responsible. We have heard just staggering numbers about all sorts of deficits and deferred maintenance and basically every one of our systems, you know, has problems. And it seems that fiscal responsibilities policy just takes none of that into account. So I think this would be a great policy to overtake an overhaul and conduct a review of, and could be a lasting legacy of this government, to make sure we are on a sustainable path. Thank you, Madam Chair.
To the motion? Member for Frame Lake.
Yes, thanks, Madam Chair. Yes, and I want to thank my colleague from Yellowknife North. He's covered off a number of my concerns, particularly with regard to P3s being used increasingly by GNWT.
But the other aspect that the report goes into, and this was found in the audit by the auditor general, was that there was overspending on capital by $32 million during 2019-20. You know, the 50 percent mark was a certain figure, and we only generated a $46 million cash operating surplus but we spent $78 million on capitals using the fiscal responsibility policy.
So even though our government failed to comply with it, there's no consequences. Nothing, except the auditor general blew the whistle on us. So that's another reason why we need to review this policy and make sure that it does really reflect the longterm sustainability, fiscal sustainability, that we should have as a government and for our residents. So I support this motion and look forward to an opportunity to revise that policy. Thanks, Madam Chair.
Thank you. To the motion?
Question.
Question has been called. All those in favour? All those opposed? All those abstaining? Motion is carried.
---Carried
Member for Yellowknife North.
Madam Chair, I move that this committee recommends that the comptroller general add to the financial statement discussion and analysis section of the public accounts several reporting items that are present in public accounts of other jurisdictions; specifically,
Population data;
Unemployment rates;
Key nonfinancial results of major sectors;
Variances between budget and actuals and between current and prior year actuals by revenue source;
Variances between budget and actuals between current and prior year actuals by expense program and object;
Discussion details on each liability line item; and,
Classification of the indicators of the financial health to one of three elements: Sustainability, flexibility, or vulnerability.
And further, that the comptroller general extend all historical charts in the financial statement discussion and analyses section of the public accounts to include ten years of data. Thank you, Madam Chair.
The motion is in order. To the motion? Member for Yellowknife North.
Thank you, Madam Chair. Committee conducted a review of best practices of public accounts across the jurisdiction and pulled these ones out. I would like to speak to a couple of them.
One, I really believe having ten years worth of data available from the public accounts would allow us to see these larger trends. It's just simply not really there.
Secondly, we make a number of recommendations of lining up the public accounts to the budget and the variances. There was some very odd disconnect that the public accounts are an accounting exercise done by the accountants. They don't even look at the budgets. If there's a difference in the budget, it doesn't matter to them and it doesn't inform the subsequent budget. They're done by different people, and there's just consistent areas where the budget and the public accounts don't line up. Revenue projections being one of them.
We have never predicted our revenue accurately within tens of millions of dollars. And the comptroller general will point this out, and for some reason it doesn't then make a change in the budget. We are one of the worst jurisdictions for this. We get an "F" when people review our financial transparency because our budget and our public accounting are just not aligned. Many other jurisdictions have made it work so that when the public accounts and the accountants point something up, it automatically makes a change in the corresponding main estimates. That's not occurring here. I really would like the comptroller general and the Department of Finance to get together to make that happen. Thank you, Madam Chair.
Thank you. To the motion?
Question.
