Indigenous and Northern Affairs Committee on March 6th, 2014

[Jean Crowder, NDP, Nanaimo—Cowichan, BC]

It's net new money to the department.

[Michael Wernick]

For that purpose, yes.

[Jean Crowder, NDP, Nanaimo—Cowichan, BC]

So the total authorities to date and the total estimates to date don't look a lot different.

[Michael Wernick]

Pam will help me on this, but in some cases we have an authority, which is sort of a ceiling, for a whole bunch of programs. If we don't need all of the money in a given year, then we don't have to come to Parliament for a particular top-up.

[Jean Crowder, NDP, Nanaimo—Cowichan, BC]

Yes, I understand that. What I'm saying is that the money has been reprofiled.

[Michael Wernick]

Yes.

[Jean Crowder, NDP, Nanaimo—Cowichan, BC]

For example, there was $33 million for schools. Now it's hard to believe that the department couldn't spend the $33 million that was already allocated.

This was money that was reprofiled from budget 2012. Is that correct?

[Michael Wernick]

In vote 10, of almost $6 billion, there is some slippage across about 50 different programs, yes.

[Jean Crowder, NDP, Nanaimo—Cowichan, BC]

I'm just wondering why it was that the department couldn't get the money out the door for schools. We know that there's a long list of schools that need to be built or renovated or remediated in some way.

What prevented the department from getting that money out the door?

[Michael Wernick]

You only pay as the projects are proceeding. The projects are built by the first nation. They do the contracting, they do the building, and we reimburse them in progress payments as things start. Each project has its own little project management challenge. Sometimes it's a slowdown in the tendering process, the availability of suppliers. We had a delay in one project because of winter road problems in northern Manitoba.

[Jean Crowder, NDP, Nanaimo—Cowichan, BC]

What is it that the department could do to make sure that money is fully expended, given the huge demand for schools?

[Michael Wernick]

We manage every project as intensively as we can with the first nations who are doing the building. What we're trying to encourage, but not force, is as much as possible standardized design, using the same blueprints more than once, bundled projects. If we can do four projects in one tender, we'll do it that way. If there was a good modular design built in one part of the country, we suggest that they use the same design instead of starting from scratch. We help move along the land processes. Anything we can do to speed it up, I assure you we try to do.

[Jean Crowder, NDP, Nanaimo—Cowichan, BC]

Am I done?

[The Chair, Conservative, Chris Warkentin]

Thank you.

We'll turn to Mr. Leef now for the next round of questions.

[Ryan Leef, Conservative, Yukon, YT]

Thank you, Mr. Chair.

Good to see you here on committee, Minister.

I'm sure you know that in January we went into Yellowknife to hear witnesses on Bill C-15. I'm looking over your supplementary estimates (C) in respect to the Northwest Territories devolution act. Of course, we've heard from people like Premier Bob McLeod, who has said that this devolution act could be a game changer for the people in the Northwest Territories. As a Yukon member of Parliament, I have certainly experienced the benefits that our territory has gained through devolution over the 10-year period that we've enjoyed those benefits.

There's approximately $36 million allocated to help implement the devolution agreement. I'm just wondering if you can let the committee know what the progress looks like in terms of the implementation of the devolution agreement, and how it will increase economic opportunities for the people of the north.

[Bernard Valcourt, Conservative, Madawaska—Restigouche, NB]

As you may remember, I was in Inuvik last June 25 in order to sign the agreement on behalf of the Government of Canada with the Government of the Northwest Territories and the five aboriginal groups who signed the final agreement. After you've done the work here, after passing through the House before Christmas, Bill C-15 was referred to the Senate. Just yesterday, Senator Neufeld tabled a very favourable report of the Senate Committee on Energy, the Environment and Natural Resources. So we've been making excellent progress on implementation, and I fully expect that we will be able, indeed, to meet the target date of April 1.

Now the $36.1 million that you mentioned received in the supplementary estimates (C) for devolution will allow for the department to cover one-time costs that are associated with the transition, and thereby satisfy our obligations in the Northwest Territories devolution agreement. That was an undertaking of Canada. Of that $36.1 million, there is $20.5 million that is a recovery of grant payments that were internally cashed, managed in supplementary estimates (B), and paid to the Government of the Northwest Territories to offset their one-time costs associated with devolution.

The economic opportunities that this act proposes to bring to the north are vast and well documented. You know what has been the experience in your own Yukon, and we are hopeful that starting April 1, the Northwest Territories see a new day.

[Ryan Leef, Conservative, Yukon, YT]

Thank you.

So $36 million, particularly the volume, set aside for a one-time cost is obviously a significant investment. Can you put in perspective for us how long the people and the leaders of the Northwest Territories have been working toward this devolution agreement? Why is this agreement such an important milestone in the lives of the people of the Northwest Territories?

[Bernard Valcourt, Conservative, Madawaska—Restigouche, NB]

The people in the Northwest Territories have waited a long time for this day. This started almost 80 years ago with successive devolution agreements covering other aspects of local governance including education, health care, and social services.

The bill that we have passed, which I understand is about to become law, has been in the making for over 25 years.

In 2001 the Government of Canada, the Government of the Northwest Territories, and the aboriginal summit, which was the body representing the seven regional aboriginal organizations, concluded a memorandum of intent on devolution. In 2002 all parties commenced devolution discussions and concluded a framework agreement. In 2011 a devolution agreement in principle was signed in January. It was in March 2013, if I recall, when the Prime Minister came to the Northwest Territories, that the agreement in principle, the consensus agreement, was reached, which led to the introduction of the bill that will result in this being in effect on April 1, 2014.

So it's been a long wait, but the northerners of the Territories can be proud on April 1, because they will be the architects of their own future.

[Ryan Leef, Conservative, Yukon, YT]

Minister, I'd like to congratulate you on getting close to finished now. We're getting near the finish line. But certainly, as you've articulated, success after 80 years of attempts to bring this historic agreement to fruition for the people of the Northwest Territories is certainly a monumental achievement. So congratulations on working well with your GNWT partners to make this happen.

I understand that the NWT is mirroring some federal legislation to prepare for the assumption of control on April 1. Can you share with the committee what steps are being taken to ensure investor and stakeholder confidence in this transition period?

[Bernard Valcourt, Conservative, Madawaska—Restigouche, NB]

As I've mentioned, the activities required to implement the devolution agreement are now well advanced. We're making really good progress toward meeting the target date of April 1.

AANDC's pre-April 1, 2014, obligations include one-time funding to the Government of the Northwest Territories, as I've said, and to aboriginal groups. Our work includes notifications to private sector interests, aboriginal consultations, introduction of legislation in Parliament, transfer of records, transfer of assets, human resources, creation of inventories and of waste-operating sites, the excluded lands. There's a lot of work taking place.

Coming back to those one-time costs, the majority of.... We do have one-time costs, as a department, and they are associated with the payments to employees pursuant to the federal work force adjustment directive, which we must respect. We have made extensive efforts to ensure that the proper human resource and infrastructure systems are in place to allow for the smooth transition, which is proving to work.

The payments of ongoing devolution funding to the Government of the Northwest Territories and for aboriginal groups will commence in 2014-15. This is not part of these estimates; it will be in the main estimates.

The Government of the Northwest Territories will receive $67.3 million in ongoing funding through an increase to the gross expenditure base portion of the territorial formula financing, with AANDC entering into grant agreements with the government for $3.6 million for obligations associated with transferred land claim obligations, and with aboriginal groups for the $4.6 million identified in ongoing funding for those groups.

That would be the extent to which stakeholders can have confidence that this transition is taking place effectively.

[The Chair, Conservative, Chris Warkentin]

Thank you, Minister.

We'll turn now to Ms. Bennett for the next round of questions.

[Carolyn Bennett, Liberal, St. Paul's, ON]

Thanks very much.

Thank you, Minister.

As you know, there were concerns in regard to budget 2014 that the money invested in education, which was to complement the act, doesn't flow for at least a year in infrastructure and implementation, and it's even longer than that to close the gap. There is a huge concern and there's a lack of trust that money flows.

Although your deputy answered my colleague's question, I would like to know this from you as minister. When budget 2012 said that it invested $175 million over three years—so that's less than $60 million a year for infrastructure and schools—how do you, as the minister, explain that you reprofiled $33 million of it that isn't going to schools?

[Bernard Valcourt, Conservative, Madawaska—Restigouche, NB]

Well, specific to the budget of 2012 and school initiatives, this reprofiling of $33 million has been requested and approved for 2013-14 because of the number of delays, which the deputy has referred to. It's all right to have the appropriation and the authorization of Parliament to spend the money, but you have to be able to spend the money. In this specific instance, in the case of Shamattawa, winter road access prevented the bringing in of the materials, so you cannot proceed with the school construction. We had natural disasters, such as flooding, for the Siksika in Alberta. You can't build during a storm or when all the infrastructure is damaged thereafter.

Also, truth be known, some of those delays resulted from the negotiations with certain first nation communities because of project scope, which could not be agreed upon. So although these commitments are there to build the schools, it must be done within the confines of what is possible, of course, and instead of the money lapsing, it is simply reprofiled so that we may continue on these specific projects.

If I may, I'd like to give you another example. Again in 2012, for example—

[Carolyn Bennett, Liberal, St. Paul's, ON]

Minister, these are just excuses for why it didn't flow. I'd like to know, really, how many schools have you been to see in the country? These are a disaster. The kids are sick.

They're empty. I've been in many schools across the country that were closed for the week because everybody was sick.

This is an urgent thing, and you have $60 million a year and you have lapsed $33 million.

[Bernard Valcourt, Conservative, Madawaska—Restigouche, NB]

I'm afraid, with all due respect, that you exaggerate the situation. I've been to many schools with kids speaking their native language, in great settings—