Debates of May 26, 2005 (day 2)

Thank you, Mr. Speaker. Mr. Speaker, I wanted to ask about the recent announcement of Diavik diamond mine with respect to the waiving of the cost or the contribution of the employees towards travel to and from their work, so now employees who reside in southern Canada do not have to pay anything towards that travel. Certainly there was a very extensive socioeconomic agreement put in place at the time that Diavik and BHP were coming online, and our government, I believe, worked very hard to ensure that maximum benefits to northerners through the socioeconomic agreement addressing things like purchasing, contracting and employing northerners and some of the benefits staying here, the secondary diamond processing and the list goes on. So I was quite surprised to hear this announcement by Diavik. I have spoken to it publicly myself and I have certainly had it raised to me as a concern by people who are trying to build their communities with the addition of these workers who are very valued people and make contributions in our community.

Mr. Speaker, the government has been eerily quiet on this subject. I understand that these are businesses operating here in the North. They cite things like labour market competition, needing to be competitive in their remuneration and salary packages as their reasons for waiving this transportation cost, but I think they are doing quite well financially. I am a little bit disappointed with what they are doing. My fear, Mr. Speaker, is once you start flying employees in from the South, then why not just get a bigger airplane and put all the goods on too, and we will be back to the days of Nanisivik and Lupin and we’ll just fly overhead. There goes our diamonds and the people flying over.

So my concern is I haven’t heard much response from this government about this, which I think is going to have a major impact. So I would like to know if the Minister has had any communications with Diavik on this. What was the nature of his comments to them? Thank you.

Thank you, Mrs. Groenewegen. The honourable Minister of Industry, Tourism and Investment, Mr. Bell.

Return To Question 25-15(4): Diavik Employee Travel Policy

I have had several meetings with the company on this issue. I have had a phone conversation with Joe Carrabba who has now moved on. He has been replaced and I have met with his replacement as well to better understand why the company felt the need to do this. We had some discussion and I think the Member has rightly articulated the issues that the company was faced with: a very hot economy in Western Canada; having to compete with the oil sands for labour; having to compete with other projects; the startup of the diamond mine in Nunavut; the Tahera Mine and generally just a booming economy. All of these things were making it difficult.

Roughly 70 percent of their workforce is northern. Thirty percent of the workforce, and it tends to be in more professionalized skill areas, but 30 percent of the workforce currently flies in from the South, and in past they have been requiring them to pay for their travel and they’ve waived that.

Obviously we were concerned about this. We don’t want to see an exodus of people living in the North to the South. But I think after meeting with the company, I have been reassured that the company does have a vested interest in trying to get up to 100 percent in terms of northern workforce. It would be much easier for the company. They see a lower turnover in terms of northern employees who are more acclimatized. So the challenge really becomes one of training, and I think that’s why we’ve pinned a lot of hopes on programs like the Aboriginal Skills Employment Program, and the work of the Mine Training Committee, to make sure we get more people with the technical expertise trained so that we can move forward toward full employment from the North and not have to rely on southern fly-in employees.

So I did talk about our concerns about this, and the company I think is going to work as much as they possibly can to try and work with us and other partners to get our northern workforce increasingly trained. Of course, we’re challenged by the fact that we have the lowest unemployment in the country. Despite having pockets of unemployment in some of our smaller more remote communities, it can be up in the neighbourhood of 40 or 50 percent, we do, overall as a territory, have quite a booming economy. So our challenge is to try to get those underemployed people meaningful employment in industry and we’re going to work towards that. Thank you.

Thank you, Mr. Bell. Supplementary, Mrs. Groenewegen.

Supplementary To Question 25-15(4): Diavik Employee Travel Policy

Thank you, Mr. Speaker. I see this move as being regressive and counterproductive to what we’re trying to do, and that is to encourage people who work at the mines to live in the North, and everybody knows that the cost of living is higher here. I think that this move on the part of the company, I think they could have found other ways of compensating or increasing, enhancing the compensation of their employees other than this particular move. I’d like to ask the Minister how does he see this affecting other socioeconomic agreements that may be negotiated say for the Mackenzie gas pipeline. Does he not see this move and the acceptance of this move by our government without a lot of opposition to it as sending a wrong message to industry wanting to develop and take non-renewable resources out of the territory?

Thank you, Mrs. Groenewegen. Mr. Bell.

Further Return To Question 25-15(4): Diavik Employee Travel Policy

Thank you, Mr. Speaker. We are sitting down to negotiate a socioeconomic agreement in terms of employment for the pipeline. I don’t see the same reality there. We know that in terms of pipeline construction, there are so many more people required for this project than we can possibly hope to produce in the Northwest Territories in a short time. So the reality is that there will be quite a significant amount of employment that has to be sourced elsewhere.

I guess I would say that in terms of the diamond mines, the three different socioeconomic agreements are different. I’ve been personally involved in the negotiation of the one for Snap Lake. It doesn’t have the same kind of provisions and neither does the BHP agreement, but there is a provision in the Diavik Socioeconomic Agreement for them to fly their southern workforce in for four years after the start of operations, which seems to me was September 2003. So until something like September 2007 they can subsidize travel from the South. So there’s that four-year window. So they are in compliance of the socioeconomic agreement and that’s why it would be very difficult for us to come out and suggest that they weren’t living up to the terms of that agreement.

In addition, Mr. Speaker, one of the things they’ve been very successful at doing is having some of the highest northern employment targets of any industry around, and they are employing over 70 percent northerners. I think it would be hard for us to find another big industry company doing the same thing. So their track record is quite impressive. They have I think a good track record of wanting to work with northern companies, source from northern companies, get involved in community projects and they are living up to the terms of the agreement, and I guess that’s the bottom line. Now should employment targets fall below that, then we have to go back to the company and say we have a real concern here, now you’re not living up to the agreement and the terms of that agreement. But at this point it’s hypothetical because they are meeting that threshold test. Thank you, Mr. Speaker.