Finance Committee on Oct. 5th, 2017

[Michael McLeod, Liberal, Northwest Territories, NT]

Thank you all for coming. I look forward to your presentations.

As you know, my name is Michael McLeod. I'm the member for the Northwest Territories, and I represent the Liberals on this committee. I'm the newest member of this committee. I was appointed in the middle of September. Prior to that, I was on the natural resources committee and also the indigenous affairs committee. This has been an interesting committee to be on and I'm really enjoying my time here.

[Francesco Sorbara, Liberal, Vaughan—Woodbridge, ON]

Welcome, everyone. It's great for me to be here in Yellowknife for the first time, and I look forward to your presentations. I represent the riding of Vaughan—Woodbridge, which literally sits right at the top of the city of Toronto. You can walk from one side of the road to the other and be in either one. I've been on the finance committee with the chair since day one, and it has been quite the learning experience.

[Greg Fergus, Liberal, Hull—Aylmer, QC]

Hello, my name is Greg Fergus and I am the member for Hull—Aylmer, a riding located right beside Parliament, on the Quebec side.

This is my first visit to Yellowknife, but I should mention that my eldest daughter has been here on two occasions. She stayed for three months once as part of the Katimavik program, and then again for three months when as a university intern. She loved Yellowknife, and she talks about it all the time, so I am very happy to be here.

[Dan Albas, Conservative, Central Okanagan—Similkameen—Nicola, BC]

My name is Dan Albas. I'm the member of Parliament for Central Okanagan—Similkameen—Nicola in beautiful British Columbia. It's the first time I've been here, so thank you.

Mr. Chair, every time you remind our witnesses this is not the full committee, it's almost like Groucho Marx saying, “If you don't like these finance committee members, I have others.”

[The Chair, Liberal, Wayne Easter]

Some days we think that.

Pat.

[Pat Kelly, Conservative, Calgary Rocky Ridge, AB]

I'm Pat Kelly. I'm the member of Parliament for the riding of Calgary Rocky Ridge, the northwest suburbs of the city of Calgary. I'm happy to be here and look forward to the presentations.

[Pierre-Luc Dusseault, NDP, Sherbrooke, QC]

Hello. My name is Pierre-Luc Dusseault. I am the member for the riding of Sherbrooke, in southeastern Quebec, and I represent the New Democratic Party in the House of Commons. I am happy to meet you all here, in the Northwest Territories.

[The Chair, Liberal, Wayne Easter]

Thank you, members.

Mr. Erasmus, we will come to you when we do presentations.

We have quite a number of witnesses. We've been adding them as the morning goes along. If we could get witnesses to try to hold their presentations to about five minutes, it will give us a little more time for questions.

We'll start with Mr. Tuyishime, from the Fédération franco-ténoise.

[Jean de Dieu Tuyishime, Executive Director, Fédération franco-ténoise]

Mr. Chair, members of the committee, good day.

I'd like to thank you for inviting the Fédération franco-ténoise to outline the priorities of francophones living in the Northwest Territories, in preparation for the next federal budget.

Since its inception in 1998, the Fédération franco-ténoise has been the voice of Northwest Territories francophones before the federal and territorial governments and their various agencies. The federation also provides a whole range of French language services to the community.

According to the latest census data, francophones whose mother tongue is French account for 3.04% of the general population, whereas slightly above 10% of People of the North have the ability to speak French.

In light of the general community development plan, a product of consultations with Franco-People of the North, and given their understanding of the realities on the ground, the federation and francophone organizations and institutions are in a unique position to implement innovative solutions for enhancing the vitality and supporting the development of Franco-People of the North.

First, in order to invest in these organizations' capacity to carry out their mission, we need to embrace the “by and for” approach, which allows communities to decide for themselves what their needs and priorities are and to make recommendations about where government investments earmarked for their development should be targeted.

Second, we need to give community organizations and institutions the means to provide services specifically designed for the communities they serve.

Third, we need to ensure that every decision and action involving these communities is based on facts.

Fourth, we need to establish strategic partnerships with minority francophone communities as well as with majority language communities.

Fifth, we need to assess the real impact of the situation on francophone citizens.

Let us return to the issue of the steps the federal government could take to help Canadians be more productive. The Government of Canada announced major investments in the fields of infrastructure, digital media, early childhood and youth employment. This represents meaningful action and reflects sound priorities. That said, just because a federal program is offered to everyone, in both official languages, does not mean that it will benefit minority francophone communities.

We recommend that the next budget include initiatives specifically designed to allow minority francophone communities to benefit from investments.

When we talk about our inadequate or non-existent social infrastructure and community centres, when we say there aren't enough resources for French language programs, then we'd certainly be remiss if we let this opportunity to strengthen the francophonie in the Northwest Territories pass us by.

To us, infrastructure funding could mean having a community centre in Yellowknife, or French language daycare centres—both of which are desperately needed across the territory—or affordable housing, which would allow our communities to maintain or increase their demographic weight by ensuring francophone migration and immigration.

In light of all this, I believe that the federal government could really make a difference in our communities by reviewing its investments in social infrastructure and by adding measures tailored to the realities of minority francophone communities.

Funds intended for digital media, including specific initiatives intended for small communities like ours, could help our media organizations, including community radio stations and newspapers, transition to newer technologies as well as promote high speed Internet access in our communities. Similarly, the government could create mechanisms using some of the funds already invested in the youth employment strategy in order to help our local youth find jobs.

The message I want to leave you with today is that enhancing the vitality and supporting the development of Franco-People of the North communities and indeed of all minority francophone communities across the country, as required by the Official Languages Act, can often be achieved through existing programs and investments.

Thank you.

[The Chair, Liberal, Wayne Easter]

Thank you very much.

Turning now to the Northwest Territories and Nunavut Chamber of Mines, we have Mr. Vivian, president, and Mr. Hoefer, executive director.

I know that you went to great lengths to get your document translated so that it could be before members during your presentation.

The floor is yours.

[Tom Hoefer, Executive Director, Northwest Territories and Nunavut Chamber of Mines]

Thank you very much, Mr. Chair, and members of this committee for inviting us to appear. Please accept our kudos for coming north to Yellowknife for this meeting.

My name is Tom Hoefer. I'm the executive director of the Chamber of Mines. I'm joined by Gary Vivian, our president, who is also chair of the largest northern exploration consulting company. We represent the N.W.T. and Nunavut minerals industry, so we will be speaking on issues of interest to both territories.

We've provided a deck for you, as the chair mentioned, and we'll paraphrase it in the next five minutes. There are a number of key messages we want to leave with you today in the hope that they will find their way into the budget.

First, our minerals industry is the largest private sector contributor to the economies of both territories. In a strong market year, our diamond mines contribute nearly half of the N.W.T.'s GDP. Gold and iron mining too are now growing along a similar path in Nunavut.

Most importantly, our industry continues to make significant strides with socio-economic benefits. This is game-changing, we would say, as we've made some of the most significant economic contributions to indigenous communities and their businesses, residents, and governments over the past 20 years. We have really helped to create and bolster a growing middle class.

Slide 7 in particular speaks to these benefits, which include 13,000 person-years in indigenous jobs, nearly $6 billion in indigenous business, and over $100 million in scholarships and donations to communities. Our mines even generate taxes and royalties today for indigenous governments beside payments to public governance.

On slide 7 is a thumbnail of a Mining North document that we've also provided to you today in that package. It details those benefits for later reading. It's very important that we all work to sustain and grow these northern benefits. To that end, we're asking for your help in five areas, described in more detail in our submission.

The first is investment in road and power infrastructure. The north has Canada's largest infrastructure deficit. We have few to no roads, and few to no hydro power facilities in the N.W.T. and Nunavut. Canada was a willing partner in resource development, providing infrastructure like roads, hydro power, and rail from the 1940s through the 1970s, but for some reason that investment dried up. Over the past 40 years, our mines have been supplying their own roads, power, airports, marine ports, and communications, and that makes us less competitive.

We're thankful for the federal commitment to the Tlicho all-season road in the N.W.T. We're also hopeful for federal investment in the Grays Bay road and port in Nunavut, and the Slave geological province road in the N.W.T., which would open up a mineral-rich area similar to the very rich Abitibi region of northern Ontario and Quebec. It would also link Nunavut by a road to Canada, a nation-building concept if ever there was one.

We also seek your help in seeing the north represented on the Canada infrastructure bank.

All-season roads would also allow us to use greener fuels, which current seasonal transportation prevents us from using. That is why we're asking for a carbon tax reprieve in the north until infrastructure catches up.

Second, we're asking for help to enhance mineral exploration by firmly extending the mineral exploration tax credit for three years; by investing in geoscience research, which is the R and D of our industry; and by settling outstanding indigenous land claims. These unsettled claims have contributed to the N.W.T. missing out on $1 billion in exploration investment in the last 10 years, a big hit on many of our businesses and on our economy.

Third, we're seeking help too in building community capacity. We're facing huge employment needs for several reasons. In the N.W.T., replacement and expansion demand will require from 28,000 to 37,000 jobs over the next 15 years. In Nunavut, the baby boom is growing the youngest population in Canada. Infrastructure construction and resource development will help provide job opportunities. We thank the government for their current support but ask that the budget ensure and protect that ongoing training support. Today we have a moderate request of around $1 million to purchase portable simulators that we can transport to our remote communities to train equipment operators.

Our fourth request is in helping improve our regulatory environment. Our territories are leaders in Canada in environmental legislation and process. That's because our processes are based in land claims. They are inclusive and transparent, and they're very thorough. The environmental review panel that Canada struck reported that they wouldn't review the north's system for those very reasons. They even said that the rest of Canada could learn from the north, but here's the “but” where we need help.

The Harper government made a change to legislation to allow for the recovery from proponents of the “not insignificant” costs of these very thorough processes. Such cost recovery would further hurt our economic competitiveness, something that we desperately need help with. Please do not support creation of cost recovery regulations in the north. In fact, if you have the opportunity, strike down any work on it.

Our last request is for your help with the Arctic policy that is coming. In the interests of time, our simplest comment would be to acknowledge the news release and pan-territorial vision for sustainable development that was issued jointly by the three northern premiers. It speaks to an economic foundation of responsible resource development, leading to self-reliance through infrastructure investments and job creation. Most importantly, it asks that we northerners play a strong and inclusive role in the Arctic policy's creation. We totally echo the three premiers' position on the Arctic policy development.

I suspect that's our five minutes. We thank the committee for the opportunity to present and we look forward to your questions.

[The Chair, Liberal, Wayne Easter]

Thank you very much, and thanks for getting those documents translated so people could follow.

From the Northwest Territories and Nunavut Construction Association, we have Mr. Rowe, the vice-president.

[John Rowe, Vice-President, Northwest Territories and Nunavut Construction Association]

Thank you, and good morning.

[The Chair, Liberal, Wayne Easter]

I know another John Rowe, whose name is spelled exactly the same way, from P.E.I.

[John Rowe]

Well, I have some challenges with this, because this is my actual name, but I go by “Jack”. Ever since 9/11, of course, you can't travel unless you use your actual name and I can't get through security with my actual name.

[An hon. member]

Hi, Jack.

[The Chair, Liberal, Wayne Easter]

Welcome, Jack.

[John Rowe]

Thank you very much for coming, and welcome, all of you, to the north.

You all have a copy of the package that we submitted. Rather than go through the specifics of it, I'll just say this region—both Nunavut and the Northwest Territories—is very lightly served by infrastructure. In fact, almost half of our communities don't have all-weather road service. That drives the cost of putting infrastructure into these communities to a high rate. The majority of the communities don't have actual piped water and sewer. They rely on truck water and sewer. There's been some work done to try to develop additional water treatment plants and whatnot, but without accessibility, that all takes a lot of extra money. This comment has already been put forward, but accessibility in the north is very difficult without having additional infrastructure investment. We have a small economy—there are 40,000 people here in the Northwest Territories, and it's similar in Nunavut—so you can't physically pay for that infrastructure, and that impedes economic development.

We would strongly encourage the federal government, when looking at putting money in and developing the resources to support infrastructure, to work with the current structures, such as the governments that are there, rather than developing another infrastructure. We've seen past efforts made to try to put in additional resources, for example, setting up a different way of funnelling the money through or putting the resources in. It becomes very tedious and it's hard to make sure that everything is supported there.

Comments were made that the majority of money that's spent on development of infrastructure actually flows through to southern Canada. The comments come back, “It's a small population, why should we put that much money here?” If you look at developing a mine or road up here, I would say that probably 80% of the money flows through the south, whether it's through employment income, taxes on fuel, the actual cost of fuel, or the structures. We don't have a lot of those facilities here, so the money is actually flowing back through to southern Canada, and it helps everything else.

To get to the two specific questions that you had, we don't have a lot of comments on how you help Canadians be more productive, beyond support for education and training. That really needs a push.

What federal measures would help Canadian business to be more productive and competitive? I don't think it's a secret out there that there's not a lot of businesses that are in support of the proposed tax reforms, so it should be delayed and looked at as to what the reality is. There's some talk about taking the dormant money out of small businesses. I was talking to some of my colleagues here, and they're not really sure what dormant capital is in small business, especially in the north. You utilize everything that you can, and access to capital is a big shortfall.

I have one suggestion. Going back many years, the federal government had an investment tax credit that actually encouraged businesses to invest in equipment. We have a situation here right now where we're looking to try to reduce our carbon footprint. One of the ways is to try to invest in new equipment and to use more fuel-efficient equipment. That whole process should be reviewed, for two reasons. It allows businesses to be upgrading their equipment and to be more competitive in the field, and it also reduces the consumption of diesels and whatnot. We support the Canadian Construction Association's initiatives and their submissions to your group here.

That's the gist of our presentation. As I said, you have the formal copy; I just wanted to speak to it.

Thank you.

[The Chair, Liberal, Wayne Easter]

Thank you very much. All the members have all the submissions that were made prior to mid-August on their iPads, and they're certainly part of the discussion.

Next is Mr. Wever, president of the Northwest Territories Chamber of Commerce. Welcome, and the floor is yours.

[Trevor Wever, President, Northwest Territories Chamber of Commerce]

Good morning. Thanks, and good job on pronouncing my last name correctly.

Thank you to the committee and staff for including Northwest Territories Chamber of Commerce in these important pre-budget consultations. For today, the NWT Chamber of Commerce was asked to provide input on two specific questions. We welcome this opportunity to provide input on key northern issues for consideration by the finance committee and the pre-budget consultations.

The overall message will be fairly similar to what you've heard so far in terms of energy and infrastructure. On the first question, of what federal measures can help Canadians be more productive, I have a couple of examples. One is training and increased funding to the Aurora College to deliver an industry-led training program. That training is an immediate need for industry. Another example is the extension and expansion of the Canada-N.W.T. job grant.

In terms of mobility, transportation infrastructure is a problem. The N.W.T. represents a vast land mass with very little transportation infrastructure available to connect communities. The limited infrastructure that is available is aging and unable to support future growth opportunities, while in part contributing to the high cost of living, poor delivery of sustainable health care, and lack of socio-economic wellness.

Another example for mobility is affordable energy, which is currently non-existent in the N.W.T. as compared to more southern parts of Canada. This is one of the single largest drivers of the high cost of living for people in the north, and contributes to the stagnant productive growth in the territory, as well as limiting opportunity for its residents because the majority of their income is directed towards struggling to support basic living necessities.

The federal government's carbon tax plan is further exacerbating this cycle and is especially harmful in the Northwest Territories, where advanced technology and sustainable green energy solutions are not available and cannot be feasibly supported with the existing infrastructure. We need to see the revenue generated through any carbon tax diverted back to advancing made-in-the-north solutions to promote more sustainable energy solutions, rather than seeing those funds funnelled into unfamiliar pools.

On the second question regarding what federal measures could help Canadian businesses be more productive or competitive, again—you've probably heard this a few times now—the answer relates to the proposed changes to the small and medium enterprise tax regulations. The proposed regulations will be disastrous to small and medium-sized enterprises, despite what the federal minister is saying. Small and medium enterprises are the backbone of any diversified economy, and to propose changes that would essentially handicap them is entirely counterproductive. This is especially true in the Northwest Territories. Although our economy is augmented by the contributions of large corporations, primarily with the operating diamond mines, we are largely reliant upon ongoing contributions of small and medium-sized businesses to provide essential goods and services, as well as employment opportunities.

These same small and medium-sized businesses contribute to their local communities in all conceivable aspects, through good corporate citizenship, community social involvement, and charitable support. The owners of these businesses are not the elite one per cent that everybody assumes. These are hard-working, humble people who have worked, sometimes for generations, to build their businesses and often sacrifice their own well-being in order to keep the business afloat and generate employment during economic slow times.

In regard to the carbon tax plan, as mentioned earlier, a made-in-the-north solution is the only solution to support the carbon tax. An off-the-shelf version that may work in the southern one-third of the country will only further escalate the unsustainable costs of living and doing business in the Northwest Territories, where there are no realistic options for greener technology.

In terms of infrastructure, energy, and transportation, the Northwest Territories is a source of vast wealth to the Canadian economy. This has largely remained untapped, due primarily to a lack of dependable infrastructure. Major transportation corridors, upgrades to airports, and upgrades to underutilized hydro power are essential to promote economic development in the Northwest Territories. In many instances, the required investment to link some of these existing infrastructure projects is very minimal, but will pay dividends for generations to come. At the very least, these are nation-building projects that would further support the federal government's commitment to northern sovereignty.

Although we are grateful for recently announced financial injections from the federal government for infrastructure projects, the allocated funds are woefully inadequate to make a meaningful and long-lasting impact. We would encourage the decision-makers in Ottawa to visit the Northwest Territories and meet with key stakeholders to get an honest, first-hand view of what we're dealing with and the level of involvement required.

That's what we have. There are obviously lots of other key things that we're working on, but for a five-minute presentation, these are the highlights.

[The Chair, Liberal, Wayne Easter]

Thank you very much. To say that we've heard on the tax issue a few times I think would be going fairly light on the subject. We have heard multiple times.

[Trevor Wever]

Is it working?

[The Chair, Liberal, Wayne Easter]

I think it is working, but I guess we'll see at the end of the day.

Next we have Ms. Wawzonek, with YWCA Yellowknife.

[Caroline Wawzonek, Vice-President, YWCA Yellowknife]

Thank you, Mr. Chair.

Good day. I would like to welcome those of you who are here for the first time.

I am here on behalf of the YWCA. We've been servicing the north now for over 51 years. We support the submission that was put in by YWCA Canada. In addition to that, we want to provide some specific comments on the situation facing women, children, and families in the north.

By way of introduction, I want to note that it's our view that we actually share a similar mission to the members of the committee. The mission of the YWCA NWT is to build safe and equitable communities where women, girls, and families can realize their full potential. We'd like to assume that the allocation of federal resources would likewise aim to build safe and equitable communities for all Canadians, where they can realize their full potential.

Our expertise is such that we'll be focusing solely on the first question that was put forward, namely, what federal measures would help Canadians be more productive. While one may not expect the YWCA to have a similar viewpoint to some of the other economic-focused entities that are here, I would say that we share their view that infrastructure is in fact one of the critical things facing the north. From our perspective, it's specifically physical spaces for transitional emergency housing, as well as for child care facilities. Again, we take the view that it's an infrastructure investment that you can [Inaudible—Editor].

I'll speak first on affordable housing and emergency shelters, and the situation facing the north. The YWCA welcomes the development of a national housing strategy. It was a meaningful infusion of $11.2 billion in the 2017 budget. That said, we are concerned that the calculation of funding allocation was perhaps premised on an incomplete picture of the state of housing in the north. I'll give you three specific examples.

First, the YWCA NWT manages Lynn's Place. This is the only women's transitional housing facility anywhere in the Northwest Territories. It services Yellowknife, obviously, but it also services the entire region. The building is a safe place for women who need housing after a violent relationship. It's a place where they can find stability and safety, so that they can re-enter the job market. It's a success story. However, it is only phase one. It was only ever intended to be phase one. There is still phase two that could come. Land is set aside and there are potential partners in place, but we lack the capital commitments to actually begin construction projects. A federal contribution to kick-start that project would have a significant impact on women in the Yellowknife region, but also on some of the individuals you've heard speaking here today, who also are looking for similar types of opportunities to engage in construction projects.

Second, the YWCA NWT is responsible for the management of Rockhill apartments. These are subsidized apartment buildings for families. There are also two full-time family support workers, who work with residents so that they can go back into the regular market economy. It is a unique facility and service in the north, and one that therefore benefits not only Yellowknife, but all of the NWT region. It's also a success story, as families again transition back into the regular rental marketplace, as well as a crucial safety net.

The YWCA's lease on the Rockhill building will be up in early 2018. The building has been identified as one, arguably of many, that has critical asbestos remediation problems and likely requires a complete plumbing overhaul. The families living in the 33 housing units cannot stay there when this is happening. There is no solution to what will be a problem within the next 12 months. Again, an infusion of federal funding, partnered with local funding to seek an option for physical infrastructure, whether that be a new facility or renovating the existing facilities, would support solutions for these residents and those who are on the waiting list to get in.

Our third example with respect to housing is the Northwest Territories shelter network, which is chaired by YWCA NWT. This links the five emergency shelters that are spread out across the territories. In this capacity, we hear both from the women we are serving, as well as our colleagues in these shelters, first, about the power that can be held when someone's name happens to be on the lease of their housing, and second, about the difficulty that women face in terms of getting out of these communities if they need to. In many instances, they require two plane trips in order to access emergency facilities.

Again, infrastructure funding would assist in some of the smaller communities in accessing locations, but chronic mould and asbestos remediation are also concerns that face almost every one of these shelters and certainly will face them as they look to expand.

I believe it has already been mentioned to you that we're all grateful you're in the north to actually see on the ground what the situation is, but Yellowknife is sort of the south. We're not really the north, and it's the smaller communities where you would truly see the situation that is facing many of those communities. There are boarded-up homes, boarded-up windows, and houses that are essentially derelict.

The 2017 budget included federal funding for shelter renovations, but in many cases, as I've said, these buildings are really beyond renovation.

There are no interim solutions for these overcrowded facilities. They can't simply be torn down. There's nowhere else for people to go.

What we propose is that there be capital infrastructure funding to assist in building entirely new structures. This would also require a realistic assessment of what those costs are in the north given the rural situation we are facing given our geographic isolation. I believe that was amply identified by the construction association.

Our second proposal we would like you to consider is around safe and affordable child care. The YWCA NWT again acknowledges the 2017 budget commitment to spend $7 billion on a national child care strategy and initiative. We certainly welcome the development at long last of a national child care framework.

In 2015, the GNWT commissioned a major study into the feasibility of universal child care here in the north. It was long overdue. There are at least 12 communities in the north with no licensed facilities whatsoever, and it was described in that study as essentially a cottage industry. Certainly this would impede women's participation, and, indeed, not only women but families' participation in the wage economy.

Universal child care, it was discovered, could be based on $21 million per year. This would assist not only the facilities and the spaces but also in having trained caregivers who are there to help educate and equip the next generation.

The YWCA NWT were recently approached by the Fort Smith Day Care Association to assume the responsibility for their association. They have run into either political or logistical hurdles trying to find a safe space to construct a day care facility in Fort Smith which is one of our more major centres. Although it has been two years since the study was commissioned, here in the Northwest Territories, we continue to struggle with this issue, often from the perspective of actual logistics and actual physical spaces. The Fort Smith association received verbal commitments from the Northwest Territories Housing Corporation to have access to a space, but this will not be a new space. It will no doubt require renovations, hopefully not asbestos related. A federal commitment to child care infrastructure would again make a significant difference in Fort Smith as well as the other 12 communities with no current facilities.

In closing, as you travel, the YWCA NWT hopes you will remember that infrastructure development can mean many things but also that costs of that development can also be very wide ranging. We also hope you realize infrastructure, of course, means a foundation that is ultimately one of human capacity.

We would suggest you stay focused on our shared mission, which is one of building safe and equitable communities so Canadians of any gender can grow to their full potential.

Thank you.

[The Chair, Liberal, Wayne Easter]

Thank you very much.

Next is Ms. Rabesca Zoe.