Finance Committee on Oct. 25th, 2011

[The Chair, Conservative, James Rajotte]

Please give a brief response.

[Sandra Babcock]

In a very competitive job market, it is very difficult to attract good people. We also have to contend with the higher cost of living in the territories when we're trying to attract new skilled labour. That would definitely have an impact on our ability to attract.

[The Chair, Conservative, James Rajotte]

Thank you.

We'll go to Ms. McLeod, please.

[Cathy McLeod, Conservative, Kamloops—Thompson—Cariboo, BC]

It's certainly my pleasure to be here. It's only my second time. I think the last time I was here, actually, we heard about the long-gun registry. I want to just mention today that we've introduced legislation to get rid of the long-gun registry. I know that was really important to Yukoners. So I think it's a great preamble to come back and note that it's finally happening.

To focus on the issues of the day, I'll start with the tourism association. You're probably aware that we just released a strategy about two weeks ago, and within that strategy we talk about what many in the tourism industry like to say is a disincentive.

First of all, I can't recall what your sales tax is here. How many of your tourists come in organized group tours? How much impact will that have as we work towards a resolution of that issue, which we plan to do in January?

[Krista Prochazka]

We are extremely fortunate in the territory to pay only GST and to not have a territorial sales tax.

In terms of the number of visitors who come in group travel, it is fairly significant. We have a large number of operators that bring in very small groups. Our largest operator, without a doubt, is Holland America. They bring a tremendous number of visitors to the territory, in groups and buses, from the cruise ports in Alaska. I can certainly speak to my counterparts across the country that the elimination of those taxes would be incredibly beneficial to the territory. Canada is always going to be a relatively expensive place to travel to or visit, so anything that makes Canada more cost-competitive will benefit our territory and our country.

[Cathy McLeod, Conservative, Kamloops—Thompson—Cariboo, BC]

Coming to a more seamless resolution is important, although I guess it's even more important for some of our other provinces if they have both taxes.

[Krista Prochazka]

Absolutely.

[Cathy McLeod, Conservative, Kamloops—Thompson—Cariboo, BC]

Great.

There was a comment by my colleague about payroll taxes. I presume, as well, that for any sort of plan the opposition might put out for a 45-day work year, the consequent impact on EI deductions would be equally or perhaps significantly more of a negative. Is that fair to say? I'll ask all three that question. Does anyone have any comments about payroll taxes? EI is very similar to....

[Sandra Babcock]

I think Canada overall has a bit of a concern and challenge with productivity, and initiatives such as those are not conducive to increasing Canada's productivity.

[Cathy McLeod, Conservative, Kamloops—Thompson—Cariboo, BC]

This is my last question. I understand that the Yukon did benefit significantly from the stimulus program. There were some broadband initiatives. I know that we haven't covered all the gaps yet, but can you tell me in a more comprehensive way where you're actually at in terms of the reach and robustness of your broadband so that I have a better understanding of the situation? You talk about it being a challenge. Could you talk a bit more about where you're at?

[Sandra Babcock]

Actually, that's a really good question, because there are actually two issues on the table. Our penetration for broadband is excellent in the territory. We have very high accessibility and usage, and that creates our other challenge, and that is capacity. With increased usage, we don't have the capacity to support it. Our local broadband provider is currently looking at demand-side management to try to control that, because they don't have access to any southern optics they could supplement the system with. It's very old. It's aging, and not only does it need to be replaced, but we need redundant infrastructure, as well.

[Cathy McLeod, Conservative, Kamloops—Thompson—Cariboo, BC]

You've managed to get good reach.

[Sandra Babcock]

Yes.

[Cathy McLeod, Conservative, Kamloops—Thompson—Cariboo, BC]

My last question would be about mining exploration. I know some of our other communities have had challenges in terms of aboriginal land title rights. It sounds like the Yukon has had some better resolution in those areas than perhaps others have.

[Tara Christie]

We certainly do have some settled claims, which makes it much easier for mining companies in those areas to work, because there's certainty of tenure. Our first nations are also developing capacity to better communicate with mining companies and come to agreement.

We do still have some unsettled claims, which we hope there will be some resolution to, to provide some greater certainty in those areas as well. There still are some areas where there are some big challenges, though, because of those unsettled claims.

[The Chair, Conservative, James Rajotte]

Thank you.

Thank you, Ms. McLeod.

We'll go to Mr. Marston, please.

[Wayne Marston, NDP, Hamilton East—Stoney Creek, ON]

Thank you, Mr. Chair.

It is a beautiful place. There's no doubt about it.

Ms. Babcock, you spoke of the number of power outages. Is there a particular cause? Is it failing infrastructure, or is there something about the area we're not aware of?

[Sandra Babcock]

It is the failing, aging infrastructure. The infrastructure was first developed by the federal government through the Northern Canada Power Commission, and that was in the fifties, I believe. Then it was sold to Yukon after that. The aging equipment is our major problem.

Sometimes there are environmental issues such as storms.

[Wayne Marston, NDP, Hamilton East—Stoney Creek, ON]

But overall it's the--

[Sandra Babcock]

Typically it's the equipment.

[Wayne Marston, NDP, Hamilton East—Stoney Creek, ON]

I'm from before the fifties, and I'm wearing out too.

Your broadband is privately owned here. Did I understand you correctly?

[Sandra Babcock]

It is through Northwestel, a subsidiary of Bell Canada.

[Wayne Marston, NDP, Hamilton East—Stoney Creek, ON]

I used to work for Bell Canada. It can't be all bad.

I was thinking in terms of the investment needed and how that could be levered. In your presentation you spoke about supporting the government's balanced budget plan. We've argued that this is the time for the government to do some major infrastructure investment, like the ones that you need, to push out another year perhaps on that balance. This is the time, with the low interest rates, to lever the investment. I wouldn't mind your response to that.

[Sandra Babcock]

You bring up a good point. We're always cognizant that we don't want more debt in our country, and you have to manage the finances. Then we come on the other hand and we're asking for stuff that costs money.

I think this leads to our first recommendation, and that's the creation of an economic development strategy that will be the road map in terms of what we do.

[Wayne Marston, NDP, Hamilton East—Stoney Creek, ON]

I absolutely agree with you. Having a road map for that investment for a manufacturing strategy is necessary for our country.

Now to the prospectors: do you find the federal government a willing partner? It's very clear that the private sector has invested heavily in this, and the nature of your enterprise requires that. If you had a willing partner, are there the roads or the equipment that may be needed where you would see the federal government coming in? We hear you about the METC, by the way. That was very clear.

In terms of training workers and helping a system get here, that type of thing, would you say they've been a willing partner?