Good morning, and welcome to Yellowknife. Thank you for providing us with the opportunity to speak to you today on behalf of the Government of the Northwest Territories.
I know that our premier and our minister of finance would have liked to be here with you today, but as many of you would know, our government operates as a consensus form of government. One of the features of this is a mid-term review on the performance of cabinet by all of the members of the legislative assembly, which happens to be taking place today. This difference in governance is a reminder of how varied our country is and how different the N.W.T. is from southern Canada.
Let me start with some background about the Northwest Territories. The N.W.T. is Canada's third largest jurisdiction by land area and third smallest by population. Our 44,000 residents reside mainly in the N.W.T.'s 33 communities, with these communities ranging in size from less than 100 to over 20,000 in Yellowknife, the N.W.T. capital.
Our GDP is approximately $3.7 billion, and our economy is largely fuelled by the diamond industry and other resource extraction activities. With that said, we have other important sectors like tourism, construction, business support services, and retail and wholesale trade.
Our communities are diverse. While our overall employment rate and average income level appear to be strong, in many of our smaller communities, the employment rate is less than 50% among working age adults, and a significant percentage of families make less than $30,000 annually.
The reality of low or modest income is exacerbated by the high cost of living. It is difficult to easily capture the impact of cost of living in our communities, but I will provide an example.
Yesterday I looked and noted that you could buy a small jar of strawberry jam in Ottawa for $2.99. In Ulukhaktok a small northern community without road access, that same jar of strawberry jam costs $12.79 according to a recent survey of retail prices.
While I won't run down a litany of statistics, we can report that our education outcomes, population health indicators, crime rates, and housing conditions significantly lag behind national averages and are generally worse in our smaller communities.
Like many governments, the Government of the Northwest Territories, or GNWT, has faced fiscal challenges in recent years. We responded to this challenge by taking actions to better align our expenditures with our revenues. However, the challenge of expected slow growth in revenues over the medium term means that we need to continue to manage spending to fund new programs and services, and to respond to increases in demand for the cost of delivering programs and services.
Despite these fiscal pressures, we still want to make investments to achieve our collective vision. We fully recognize that our focus on managing our financial resources must still leave room to make investments in our population and our infrastructure, to realize the potential of the N.W.T.'s economy.
We need the federal government to understand that we are different from the provinces, and we need to have the flexibility to participate in federal initiatives in a manner that makes the most sense for northerners. One way the federal government can reflect the uniqueness of the N.W.T. is by moving away from per capita funding models towards a base-plus approach.
If tomorrow the federal government decided to invest $500 million in social housing and it was allocated on a per capita basis, the N.W.T. would get $600,000 of that. Given the high cost of materials and transportation, that would mean we would be able to build a single duplex in one of our small communities.
Turning more directly to your questions on improving Canadian personal and business productivity, there are a number of areas that we would like to highlight. In terms of measures that would help make Canadians more productive, we would absolutely agree with the focus on education and training. As we all know, the skills and abilities required are increasing in our labour market. As noted for the N.W.T., our education outcomes are generally lower than for the rest of Canada, so measures related to education and training must be flexible to be effective in the north.
Upgrading is often a required step for northern students wanting to improve their chance of labour market success. Strictly limiting programs in the way they are implemented or in client eligibility leads to making programs less effective in the N.W.T.
Organizations like the N.W.T. Mine Training Society have achieved enormous success in the field of training, not only because of the courses offering skill development but because of their other supports like courses in life skills and personal budgeting, and the provision of job coaches to ensure participants stay on track. Again, in the N.W.T., looking beyond traditional approaches for skills development and training, and providing flexibility greater than what would be envisioned in a southern urban setting is critical.
I was pleased to see housing mentioned in the material sent to us as a type of measure that may help make Canadians be more productive. It is hard to stay focused on employment, education, or training when living in substandard housing. The reality of the Northwest Territories is that housing conditions in our smaller communities continue to present significant challenges. Investment in housing is critical to building community capacity. Housing also provides training employment opportunities in our smallest communities and creates a legacy infrastructure in those communities. Housing in the N.W.T. is an essential piece of infrastructure for Canada to maintain sovereignty in the Arctic and to support the north's economic development.
The GNWT looks forward to working in partnership with provinces, other territories, and the federal government to develop a national housing strategy that will address the priority actions and specifically allow for the flexibility for provinces and territories to address gaps and to strengthen the housing continuum relative to their own jurisdiction.
I'd like to now address the issue of how the federal government can help N.W.T. business be more productive and competitive. Our first priority is to encourage the federal government to work with GNWT in advancing key strategic infrastructure investments designed to support resource development, diversify our economy, and lower energy costs, which in turn will reduce the cost of living and operating businesses. These investments are critical to unlocking the potential of the N.W.T. We have been encouraged by the investments in infrastructure that have been announced, and as these programs are more fully developed and implemented, we believe they could be an important factor in advancing some of our areas of priority.
The N.W.T. and all of Canada will capture significant economic opportunities through the construction of three strategic road corridors: the Mackenzie Valley Highway from Wrigley to Norman Wells, the Tlicho all-season road, and the improved access to the Slave geological province, where most of the diamonds sit.
The N.W.T. has thousands of megawatts of undeveloped hydro potential. There are many potential projects, the Taltson project being one of them. This is a hydro project in the southern part of the N.W.T. and, in the context of the pan-Canadian framework on climate change, the Taltson project would help reduce Canada's greenhouse gas emissions by 360,000 tonnes, would rely on existing water storage with no new flooding, and would build on a long history of working with aboriginal governments, as it would be a partnership.
A second priority would be to improve economic development and competitiveness as it relates to settling outstanding land, resource, and self-government agreements and to ensure that there is predictable, efficient, and integrated service for making decisions around land use.
I won't go into a whole lot of details on this, but in conclusion, let me say the N.W.T. has much to offer in helping to shape the future of Canada. We have a long history of working in partnership with aboriginal governments to achieve mutual goals. We have a long history of working with Canada on our shared priorities. We have new sources of energy, metals, and minerals to power Canada's economic growth.
Thank you, Mr. Chair.