Indigenous and Northern Affairs Committee on Oct. 22nd, 2009

[The Chair, Conservative, Bruce Stanton]

Good morning, members and witnesses.

This is the 32nd meeting of the Standing Committee on Aboriginal Affairs and Northern Development. This morning, we have with us the Minister of Indian and Northern Affairs Canada.

The minister has brought officials with him representing both the department and the new Canadian Northern Economic Development Agency. Members will recall that this is in fact the first meeting of what will be a comprehensive study on the question of barriers and opportunities for economic development in Canada's north.

Minister, we're delighted to have you here with us this morning to really start off what we know will be an important study, certainly for our committee, but we also believe for Parliament, as we examine these critical issues in the north.

As is customary, we'll open with our 10-minute presentation and then we'll go directly to questions from members. I think you have to leave after the first hour, so perhaps we can do that first and leave the second hour for the officials who are with you. It's up to you. If you wish to do more formal introductions of the officials who are with you today, we certainly welcome that also.

Minister, you have the floor.

[Chuck Strahl, Conservative, Minister of Indian Affairs and Northern Development]

Thank you very much, Mr. Chairman and committee members. It is a delight to be here.

I do think you're embarking on a very important study. It's timely, and there's a lot of excitement about the potential in the north and the reality in the north. I think your study is going to be of great assistance to the department and to the government and the ministry. I look forward to your work and encourage you in it. I think it's the cutting edge of some very exciting things, so I look forward to your reports as you go through this.

I'm pleased to be here today to speak to you about economic development in the north and its importance within the government's northern strategy, as well as our recent progress in establishing the Canadian Northern Economic Development Agency, or CanNor.

Allow me to begin by introducing the people with me today: Nicole Jauvin, who was recently appointed Deputy Minister and President of CanNor, Michel Robillard, Vice-President of CanNor — I believe he now lives in Iqaluit —, and Patrick Borbey, Assistant Deputy Minister for Northern Affairs at Indian and Northern Affairs Canada.

The natural resources endowment of the north is tremendous. Estimates place one-third of Canada's remaining resources of conventional petroleum in the north. Private sector expenditures in exploration of the offshore hydrocarbon potential in the Beaufort, for example, will total $2 billion over the next eight years. These activities will also generate significant economic opportunities and direct benefits for the north.

With five mines operating in the north, Canada has become the world's fourth largest diamond producer by volume. More than 30 mines of different kinds could be in operation in the next 15 years, a production increase from $1.6 billion to $10.5 billion, with direct employment booming at over 11,000 people.

Of course, the economic downturn has had an impact up north as it has all over the world, so the recovery will take some time. Mineral prices, with the exception of gold and a partial recovery in the diamond prices as well, are overall much lower than they were a year ago, and private sector investment is down as well. The economic downturn has also resulted in job losses and declining employment and participation rates across the north.

But I believe we do have every reason to be optimistic. The economy will recover, and the resource sector will continue to be the most important driver of economic development in the north. That's why we must ensure that the conditions are right for development, that development happens in a sustainable way, and that northerners are full participants at every step and derive maximum benefits.

The promotion of social and economic development is one of the four cornerstones of our Northern Strategy, which was initially unveiled by the Prime Minister in August 2007 and recently confirmed in the document titled “Canada's Northern Strategy: Our North, Our Heritage, Our Future“, which I and Minister Cannon tabled jointly this summer.

If you haven't already done so, I would encourage you to review the northern strategy documents—I believe we have some copies around today—and visit the northern strategy website at northernstrategy.gc.ca. There is much valuable information about our vision for the north, as well as the many accomplishments and commitments made to date.

There are, of course, four pillars to the northern strategy with which you're familiar: economic and social development, environmental protection, improving and devolving governance, and sovereignty. We've already taken significant action under all four pillars of that strategy. For example, we are procuring new arctic offshore patrol ships and a new polar class icebreaker, the strongest ever in the Canadian Coast Guard fleet. Important work has been done to toughen pollution laws by extending the enforcement zone of the Arctic Waters Pollution Prevention Act to 200 nautical miles, the full extent of our exclusive economic zone.

To help address the problems of inadequate and unaffordable housing, we provided $200 million over two years to support the renovation and construction of new social housing units in the territories, including $100 million for Nunavut, where the need for new social housing is greatest. This is, of course, in addition to the $300 million in the Northern Housing Trust, announced in 2006.

To maximize the economic potential of the North, we have started to "map" northern resources through the energy and mines geomapping program.

To ensure that the conditions are right for development, we are continuing to make changes to the northern regulatory regime through the northern regulatory improvement initiative. I'm looking forward to bringing into the House this fall the legislative proposal for the Nunavut planning and project assessment act, and hope to have the support of committee members on this. I will continue to work with my cabinet colleagues to bring further changes forward. I'm also looking forward to engaging in dialogue with northerners and aboriginal organizations on further streamlining of the regulatory regime to unlock barriers to development.

To help ensure that northerners have the skills required for the growing number and diversity of economic opportunities, we have enhanced the aboriginal skills and employment partnership program. I am pleased to report that three new projects were recently announced for the north, one in each of the territories.

I will turn now to the specific and important milestone of our northern strategy, the establishment of CanNor, the new economic development agency for the north. The government's intention to create CanNor was first articulated in the November 2008 Speech from the Throne. Canada's economic action plan provided $50 million over five years to establish the agency.

I was delighted to accompany the Prime Minister to Iqaluit last August when he officially announced the creation of CanNor, whose head office will be located in Iqaluit. The announcement was the crowning touch on months of work during which staff and I talked to northern residents about the new agency and its operations and structures.

In terms of its mandate, CanNor will promote economic development in Canada's three territories by: first, delivering its own suite of regional economic development programs in the territories; second, coordinating and serving as the regional delivery agent for certain national economic initiatives; third, developing policy and research, and playing an advocacy role to support effective program delivery in the long-term prosperity of northerners.

[The Chair, Conservative, Bruce Stanton]

Perhaps I could stop you there momentarily, Minister. We appear to be having a problem with

the translation, but it's working now.

[Chuck Strahl, Conservative, Chilliwack—Fraser Canyon, BC]

The problem could be my French.

[Some voices]

Ah, ah!

[Chuck Strahl, Conservative, Chilliwack—Fraser Canyon, BC]

No, it couldn't be.

Perhaps I can just give an overview now of the key programs that the new agency delivers in the north.

The first program is strategic investments in northern economic development, or SINED. SINED was renewed as part of Canada's economic action plan, with funding of $90 million over five years split equally among the three territories. The program focuses on long-term economic development through investments that strengthen the driver sectors of the other territorial economies. It helps diversify the economies or enables northerners to more fully participate in the territorial economies themselves.

One of the unique features of the SINED program is its use of the five-year investment plans, which are developed in collaboration with territorial governments, aboriginal leaders, and the private sector. Those investment plans help guide investment decisions over the five-year framework of the program and ensure that funding is deployed in a strategic and collaborative manner. There's no doubt in my mind that one of the reasons there was so much support for SINED, which has been our flagship investment program in the north, was the collaborative way in which we put together the five-year investment plans working with northerners.

Aboriginal economic development programming is an important part of the agency's suite of programs in recognition of the fact that aboriginal peoples make up more than half the population of the territories. These programs include aboriginal community economic development programs and Aboriginal Business Canada, which focuses on aboriginal business formation and expansion. While these programs remain national in scope, program delivery in the territories will be handled by CanNor, so there will obviously be a synergy working within that agency.

It's worth noting that our government's recently released aboriginal economic development framework sets new priorities for aboriginal economic development programming, including the programs transferred to CanNor. Officials in the Department of Indian and Northern Affairs will be engaging aboriginal leaders this winter in a discussion around how these programs can be improved and better reflect the priorities that have already been outlined in the framework. The agency also delivers the northern component of two stimulus programs announced as part of our economic action plan: the community adjustment fund and the recreational infrastructure Canada fund, or the RInC fund.

Finally, CanNor is responsible for the northern projects management office, or NPMO. NPMO will lead federal efforts to consult on, coordinate, manage, and track resource development projects in the three territories. For the first time, project proponents will gain access to a full range of services from a single provider, facilitating regulatory review and consultation processes. The office will also coordinate the work of federal regulatory departments and agencies during the environmental assessment and permitting phases.

Establishing this type of office is one of the recommendations of Mr. Neil McCrank, who was asked to consider ways of improving the regulatory environment in the territories. He appeared before this committee in the spring. Ultimately, the goal of the NPMO will be to achieve a more transparent, predictable, and timely review process for major resource projects and to make a positive difference in how we do business in the north.

The final area of responsibility I would like to mention is skills development. One of the main objectives of the new agency is to ensure that northern residents participate in and benefit from economic development initiatives carried out in the territories. The Prime Minister made this point several times during his recent Arctic tour.

In recognition of the important link between skills development and economic development, we plan to embed staff from the Department of Human Resources and Skills Development Canada in CanNor in Iqaluit. Their role will be twofold: to work with northerners to facilitate access to national skills development programs and to work with CanNor staff to ensure that skills development is an integral part of the agency's investment decisions.

This arrangement is essentially a pilot project and, if successful, could be expanded over time, but obviously we're very hopeful that this linkage between skills development and economic development, which is a logical one, will be made easier with CanNor's liaison with HRSDC.

I'm excited by the progress we've made to date in implementing CanNor, as I am excited by the progress we've made in delivering our northern strategy overall. I'm confident that our government is on the right track.

In fact, I was pleased to receive correspondence from the mayors of Tuktoyaktuk and Inuvik, in which they said, “As CanNor makes the announcements today for the funding for the all-weather road study between Inuvik and Tuktoyaktuk, we would like to extend a particular debt of gratitude to you for the expedient manner in which our application was dealt with and the gracious funding commitment made by your department.”

That's really a tribute, I think, to the fact that CanNor's staff hit the ground running. A lot of preparatory work went into this following the announcement in 2008. Following the Prime Minister's announcement this summer, we were able to make announcements on decisions that had been made in consultation with northerners and that have been quickly perceived, I believe, as the start of a new relationship with northerners, where decisions are made in the north, many of them through this northern agency and working closely with them.

I know that we are all committed to achieving the objective of providing this foundation for a prosperous economic future for those who live, work, and support their families in the north, so again I look forward, as I mentioned earlier, to your proceedings, studies, and reports.

I would be pleased to now take any questions you may have.

Merci beaucoup.

[The Chair, Conservative, Bruce Stanton]

Thank you very much, Mr. Minister.

I must say that you have been very accommodating in attending our committee. This is at least the fourth--and perhaps even the fifth--appearance you have provided for us in this Parliament. It has been very helpful to have your insights, especially as we embark on this study.

We are going to go to questions from members, but I'm also mindful that we have other officials here. Perhaps while the minister is here we'll entertain questions from members. At the conclusion of that, and after the minister needs to leave, we'll allow some time for brief comments from Ms. Jauvin or others as well, and then we'll also go into questions. We won't leave you there without the opportunity to at least provide some introductory remarks.

We will now move on to questions from Members.

Mr. Bagnell.

[Larry Bagnell, Liberal, Yukon, YT]

Thank you.

Thank you, Minister, for being here today.

At the end of your remarks you mentioned an example of an expedient action. I need to ask a question on a not-so-expedient action for a group that's been waiting for 10 years. As you know, the Bloc critic and I approached you about a month ago about the Teslin Tlingit justice file. At the time, you committed to get back to us by the end of the week on where it was with the justice minister.

We still haven't heard. We've made contact a number of times and still haven't heard. Will we be getting an answer soon? We just want to know where that file is. They're getting a little antsy.

[Chuck Strahl, Conservative, Chilliwack—Fraser Canyon, BC]

The difficulty, of course, is that while I certainly have talked to the justice minister, the handling of that file is primarily in the justice minister's hands and not in my own. I can't commit another minister to a timetable, but I can say that there have been ongoing discussions.

When I was in Yukon recently, as you know, at the intergovernmental forum, certainly this did come up and we had discussions on it. Not only was it a bilateral discussion, but it was a discussion that was important at the intergovernmental forum as well. There has been good progress made on that, and my sense of it is that things continue to progress.

As you say, this predates not only this Parliament but this government. But certainly I was able to give assurances from my perspective and from the government's perspective that we're eager to put this justice agreement together with them. It's a complex thing, because it's a first time ever endeavour and it involves multiple departments.

It's never easy, but my sense of it is that progress continues to be made. While I can't speak for the justice minister, I have spoken to him and he remains committed to making that happen. I'm quite sure it will come together, but again, I can't give you a timeline because it's not just in my department.

[Larry Bagnell, Liberal, Yukon, YT]

Thank you.

Last Friday I was meeting with the Kluane First Nation, and a member came up to me and said they were told, on August 4, that the ABC program, which I believe was transferred to your department, I believe from Industry Canada, unfortunately had no money for project requests left. That's pretty poor, if four months into the fiscal year you've run out of money for an important program that's been there for decades. I wonder if you're going to find some money somewhere so that people can continue to apply and use that important program.

[Chuck Strahl, Conservative, Chilliwack—Fraser Canyon, BC]

It's not unusual that programs will be oversubscribed, frankly. Popular programs are almost always oversubscribed, whether we're talking about infrastructure or programming under ABC. That doesn't mean that applications are dropped or are put in the round filing cabinet. What it means is that it's just that reality. Other decisions have been made that have gobbled up the available funds. Frequently that means that other good projects have to be put off to another fiscal year. In a sense, it's a tribute to the people making the applications. They're putting in good applications and lots of them. When it's oversubscribed, all we can do is try to get the money out as quickly as possible and make the decisions as quickly as possible.

Often, if it's not possible in one year, it gets punted to the next. The program, in a sense--I won't say it's a victim of its own success--shows that it is meeting a need. That it is oversubscribed shows, in a sense, that it's getting the job done. You can always spend more money, but that goes for many, many programs. As I said, whether it's for infrastructure or other things, more can always be spent.

[Larry Bagnell, Liberal, Yukon, YT]

I'm not sure this will be too comforting to the applicant, but I'll pass that on.

Can you please update us on the status of the devolution talks with the Northwest Territories and Nunavut and the resource revenue-sharing talks with the Northwest Territories?

[Chuck Strahl, Conservative, Chilliwack—Fraser Canyon, BC]

I think there's renewed interest in the Northwest Territories. Just before the last federal election, there was a spike in interest, if you will, from the NWT. They wanted to proceed more completely on the devolution talks. My sense of it is that the reality is that in recent months it has perked up again. It's never a continuous line, I must say, because there are so many players involved.

In the Northwest Territories, when I was up there two weeks ago, one of the questions I had for the many aboriginal groups I work with was on getting their input on devolution. What do they think of it? How do they see themselves fitting in? Are they in favour? It's never just in the Federal Court. It involves other levels of government, including first nations.

My sense is that there's renewed interest in it, not without concern, because some people want to be convinced that it's going to be good for every stakeholder who's interested in it. It's not as if it's a slam dunk or an easy thing. It involves coordinating that. But I do think there's renewed interest, and it seems to be going ahead.

[Larry Bagnell, Liberal, Yukon, YT]

Sorry, I have just one minute left, Minister.

This is my last question. The biggest aboriginal issue when you came to office, when your government came in, was the lack of progress on the implementation of land claims, the ones that had already been approved, and the nine-year review, and so on. You promised before the last election that it would be a high priority, and it's still not resolved. Can you respond to that? When may it be resolved?

[Chuck Strahl, Conservative, Chilliwack—Fraser Canyon, BC]

Especially in light of the study you're taking on, on economic development, I think it's important that the implementation continue to be a priority. It is a priority for us. We have had some renewals in order to make those discussions fruitful. The intergovernmental forum we attended about a month ago was very useful for hearing about what's progressing and about what the problems are.

Those discussions, those negotiations, are ongoing. On the renewal, on the governance issues--that part of the implementation package--my sense is that we're making good progress and that the mandates we were able to secure through cabinet are going to allow us to make a successful completion of those agreements, especially in the Yukon. I think that's specifically what you're talking about.

[The Chair, Conservative, Bruce Stanton]

Thank you, Mr. Bagnell.

We now go to Mr. Lévesque, who has seven minutes.

[Yvon Lévesque, Bloc, Abitibi—Baie-James—Nunavik—Eeyou, QC]

Thank you, Mr. Chair.

Good morning, Mr. Minister and Ms. Jauvin.

First of all, I would like to say that we used to use the term “First Nation“, but we have changed the word to include the Inuit. The Inuit do not consider themselves a first nation, but they are willing to be referred to as “first people“. There is a university in Val d'Or that they can reach.

Mr. Minister, among the recent federal measures to promote economic development in the North, you created CanNor an agency whose head office is in Iqaluit, which implies that the agency will deal primarily with investment in the territories. We know that you have already earmarked $200 million for Quebec. This is a measure you mentioned in the introduction to the Federal Framework for Aboriginal Economic Development, which you signed. The introduction states: “The new Federal Framework for Aboriginal Economic Development builds on a number of recent federal actions to improve the participation of First Nations, Inuit and Métis people in the Canadian economy. [...]“.

Is the $200 and $300 million you are talking about administered entirely by CanNor? Does the agency have the authority to invest elsewhere than in the territories?

[Chuck Strahl, Conservative, Chilliwack—Fraser Canyon, BC]

Thank you.

The amount I was talking about, the $200 million, was in reference to housing, specifically to housing investment. The $300 million was on the Northern Housing Trust. It was from an earlier budget, but it has been an effective means of improving housing in the territories. That money is not administered through CanNor, or even through my department. The trust money was handled through the territorial governments. In the case of much of the other money, social housing is done through Canada Mortgage and Housing. These were all housing announcements.

We have been able to dovetail this somewhat with skills training, with getting northerners involved in actual construction. In Iqaluit, they're building some eight-plexes. Every single person, every apprentice, is an Inuit from the territories. They are gaining certification so they can benefit more thoroughly from investments in housing.

That money I was talking about is not administered through CanNor; it comes through other commitments that have been made through territorial housing organizations.

[Yvon Lévesque, Bloc, Abitibi—Baie-James—Nunavik—Eeyou, QC]

Your answer puts things in perspective for me. It's all well and good to put an agency in Iqaluit, but there has to be evidence of a genuine desire to cooperate with the Inuit who are already there. When she appeared before the committee, Ms. Simon stated, and I quote:

We need to make sure that all of this translates not just into building a big military presence in the Arctic, but into a balance between defence and what John calls the civilization aspect: the people, and building sustainable communities.

With the advent of CanNor, will jobs be created for members of the Inuit community, for example at CanNor headquarters? How does the department envision cooperation with existing communities ?

[Chuck Strahl, Conservative, Chilliwack—Fraser Canyon, BC]

I think that's an excellent question. Certainly, this was raised repeatedly during that period this summer when the Prime Minister announced the creation of the agency. Right across the north, where northerners understandably want to be assured, they were assured by the Prime Minister that the effort is to make sure it means jobs for them, influence for them, and decision-making for northerners.

Perhaps Ms. Jauvin, either now or later, could comment on efforts to make sure that we recruit people who are northerners, specifically targeting and emphasizing Inuit and first nations involvement in the agency--depending on where you are in the north--and decision-making roles, executive roles, and ensuring that the mandate of the agency is done and carried out while listening and working closely with northerners.

As I mentioned earlier, for example, as with the administrator of the SINED program, there's already a process in place to make sure that as we make these five-year investment plans, we will be working hand in hand with northerners to do that. I think it's a good example of what we can do. Whether it was at the intergovernmental forum in the Yukon, or in Yellowknife, where I was two weeks ago, each trip I make to Iqaluit and other places in Nunavut, people want assurances, and we've been able to give that. As CanNor develops, northerners will be involved at every level, and the intent is to do a lot of recruitment. In fact, there's a little bit of worry from some of the other governments in the north that it will steal all their good people. The truth is, we're recruiting, we're hiring, and we want northerners to be involved in this agency's development.

[Yvon Lévesque, Bloc, Abitibi—Baie-James—Nunavik—Eeyou, QC]

I have a question about the negotiations with the Government of Quebec on housing in Nunavik. We know there's an urgent need. A program recently broadcast on CBC North was critical of the situation.

What is the status of the negotiations with the Government of Quebec?

[Chuck Strahl, Conservative, Chilliwack—Fraser Canyon, BC]

The Quebec government has been very clear that they have placed a high priority on housing in Nunavik, as have we. People need to understand that this is not a first nations reserve. This is a territory where we have a very special relationship; we have signed agreements with the Quebec government to ensure that we coordinate our activities there. Many of the decisions are made in Nunavik itself, as they should be, and the Quebec government is integrally involved because of the relationship that's been formed there.

On the housing itself, much of what's been done there, and what will be done there, is going to be done through the Canada Mortgage and Housing Corporation. It's not primarily a role of INAC. CMHC takes the lead on that, and that minister is responsible, because again, it's not on first nations reserve land, which is where we spend most—almost all—of our effort. That's why, whether we're talking about the far north or Nunavik, that is done through the other agency.

[The Chair, Conservative, Bruce Stanton]

Thank you, Mr. Minister.

Mr. Bevington, you have the floor for seven minutes.

[Dennis Bevington, NDP, Western Arctic, NT]

Thanks, Mr. Chair.

I'm pleased to have an opportunity to speak with you today, Mr. Minister.

I'm interested in first talking about the regulatory improvement initiatives that you mentioned. You mentioned Nunavut, but we haven't really talked about the Northwest Territories.

I go back to a letter in December from the Minister of Environment and Natural Resources in the Northwest Territories, where he stated quite clearly that their vision is that the regulatory changes would function in NWT's public interest, allow for decisions to be made in the NWT by NWT residents, and would facilitate the eventual devolution of authorities to the Government of the Northwest Territories, because of course regulatory systems are where much authority is taken over resource development.

You've now established a northern projects management office in Iqaluit. How is this going to advance the direction that the Government of the Northwest Territories wants to see with the regulatory system in providing more authority and more direction from the people of the north? How is this not going to be simply another bureaucratic instrument in the process that will actually make it further away from devolution?

[Chuck Strahl, Conservative, Chilliwack—Fraser Canyon, BC]

Good question.

It's important I think to note that not only does CanNor have offices in each of the territories and headquarters in the north, but of course the headquarters of the NPMO are in Yellowknife, which is going to make it particularly useful, especially in early days, for businesses and governments and so on in the Northwest Territories.

Even if no other changes were to take place in the regulatory system--and this is not the case, it's not what's going to happen--and the status quo was what we had to live with, and I don't think anybody at any level of government or first nations government says the status quo is ideal, my vision for the northern major projects office would be this. When somebody comes in and they want to develop a new diamond mine, they say, “I want to work with your office to walk through the existing regulatory regime to make sure that we sequence whatever studies have to be done, that we talk to the right boards, that we don't miss talking to DFO in the right sequence, that we ensure that all of the approvals are done in a timely way, and that you can help me navigate the maze.” I hear frequently up north that kind of complaint. It's just hard to figure out every single step, and people will come back and say, “I had to backtrack and go through this process and it took an extra six months,” or something like that.

I think the big advantage to the NPMO, given whatever the regulatory regime is--and as devolution occurs, it will change--for the same reason we have one in the south, where we have full provincial powers, is it can help a proponent for a big project walk through it step by step, to make sure they don't miss anything and that all the approvals come through in a timely way.

As well, the NPMO will also be able to help on consultations, the consultations that are necessary with first nations, again, because I hear this all over the country, where people say, “Well, if only I had known, I would have started that consultation in a timely way.”