Indigenous and Northern Affairs Committee on Dec. 10th, 2013

[The Chair, Conservative, Chris Warkentin]

Colleagues, I'm going to call this meeting to order. This is the ninth meeting of the Standing Committee on Aboriginal Affairs and Northern Development. Today we continue our study of Bill C-15.

We have the privilege of having the officials back to answer our questions, most importantly, but to begin with, they will have an opening statement. We'll turn it over to them, and then we'll have some questions.

It looks like we have enough folks in the room to have answers for every question. Thanks so much for being here. We really appreciate it.

[Wayne Walsh, Director, Northwest Territories Devolution Negotiations, Northern Affairs, Department of Indian Affairs and Northern Development]

Thank you, Mr. Chairman. I'll keep my comments brief before I pass it over to my colleague Ms. Shannon. I understand that there are a lot of questions from committee members, and we'd like to leave as much time as possible for those questions.

The bill before you is the culmination of what I would describe as many years—if not decades—of work towards the evolution of responsible government, I guess, for lack of better words, in the Northwest Territories.

Devolution is not new. It has taken place over time as territorial governments have evolved and the capacity and the ability to make responsibilities have grown.

We've undertaken many devolution-type initiatives with the Government of the Northwest Territories in the past. We've entered into agreements with respect to provincial-like responsibilities around education, social services, health care, transportation, the administration of justice, etc.

This last step that you'll note is the final significant step of the transfer of administration and control of lands and resources in respect of water. It is the last vestige, I guess, of the provincial-type responsibilities being transferred from the Government of Canada to the Government of the Northwest Territories.

On June 25, all the efforts of the various parties and the negotiations that have been ongoing in this stage, since approximately 2000, culminated in the signing of the final devolution agreement in Inuvik with the Government of the Northwest Territories, the Government of Canada, and our five aboriginal partners: the Inuvialuit Regional Corporation, the Sahtu Secretariat, the Northwest Territory Métis Nation, the Gwich'in Tribal Council, and the Tlicho government.

The legislation proposed by the Government of Canada will make it possible to implement the Northwest Territories Lands and Resources Final Devolution Agreement.

In short, the objectives and the principles of the devolution agreement are to provide for the transfer of the legislative powers, administration, and control from Canada to the Government of the Northwest Territories over what we call onshore public lands, inland waters, and non-renewable resources—the onshore, except for some what we call “limited federal lands”. I can get into that peculiarity or exemption through today's discussion.

The overall objective is to give residents greater control over their own destiny and create the proper conditions for economic growth, jobs, and long-term prosperity for the people of the Northwest Territories.

The bill before you is broken down into four parts. The first part is what we are proposing as amendments to the NWT Act. It is the bulk of the implementation legislation required to put devolution in place. Having said that, I will note that there are devolution implications for all parts of the bill. We can get into that as we proceed.

At this point, I will focus on part 1 of the bill. The key elements of part 1 are as follows.

It expands the law-making power of the Legislative Assembly of the Northwest Territories to include onshore public lands, inland waters, and non-renewable natural resources, again with the exception of some limited federal lands.

It confirms that the onshore public lands and inland water rights are under the administration and control of the commissioner of the Northwest Territories.

It repeals or renders inapplicable various federal laws. These repealed federal laws will be mirrored by the NWT legislation to ensure continued management of resources.

The bill also amends federal petroleum resources legislation to provide for unitization of petroleum resources straddling the Inuvialuit settlement region onshore and offshore, which is a unique aspect of the Northwest Territories devolution agreement.

Finally, a key element of part 1 also aims to modernize the NWT Act to reflect current governance structures and practices, replacing outdated terms and clarifying powers and responsibilities of institutions and government, etc.

I will take this opportunity now to quickly walk through part 1.

You will note that the executive powers of the legislative assembly are dealt with in sections 4 to 9.

The legislative powers are outlined in sections 10 to 33.

I'm sorry. To go back to the executive power, it addresses issues such as the appointment of the commissioner. It establishes the executive council and repeals and retains the federal power, etc.

Sections 10 to 33 deal with the legislative powers, and these are a lot of the new powers that are coming in as a result of the devolution agreement.

Sections 34 to 36 deal with the consolidated revenue fund of the Northwest Territories.

Sections 37 to 43 deal with the public accounts of the Northwest Territories.

Sections 44 to 50 deal with the administration of justice.

Sections 51 to 60 deal with public lands and waters.

The amendment provisions of part 1 are outlined in section 61.

Finally at the end of part 1 you'll note all the different transitional provisions that deal with either the repealing or making certain laws inapplicable on territorial lands post-devolution.

So that's a very quick overview. As I mentioned earlier, part 1 deals with the bulk of the implementation of the devolution agreement, but I must emphasize that there are elements to all parts of this bill that deal...that are necessary to implement aspects of the devolution agreement. I will turn it over to my colleague Ms. Shannon at this point.

[Tara Shannon, Director, Resource Policy and Programs Directorate, Northern Affairs, Department of Indian Affairs and Northern Development]

Thank you.

As the Minister noted last week in his testimony before the committee, regulatory improvement has long been identified as a precondition for long-term growth in the north and a more stable and attractive investment climate from which all northerners can benefit.

The genesis of the regulatory improvement initiative can be found in a number of reports and recommendations. Going back to 2005, there are recommendations from the Auditor General's report. There is the tripartite group's joint examination project. There is Neil McCrank's report, “Road To Improvement” in 2008. This resulted in the action plan of 2010, which was later expanded in 2012. This committee, I believe, also treated a key component of that action plan, which was C-47. It received royal assent in June of 2013.

I think the committee is probably comfortable with the objectives and principles as they were explained last week during the appearances. I will focus on parts 2 to 4 of the bill in front of us today. I will say that there are shared themes across these parts. It's my intent to provide further detail as the specific elements once I get to the final part of the bill, which is part 4, Mackenzie Valley Resource Management Act.

In general, the proposed amendments achieve three objectives. They introduce beginning-to-end time limits on decision-making, including ministerial decision-making for land and water permits and licenses. They reduce the regulatory burden. And they introduce a suite of enhancements to environmental protections. The proposed amendments do not change the existing environmental assessment or water licensing processes.

Part 2 of the bill respects the Territorial Lands Act. Upon devolution, the scope of this legislation will be limited to federal lands. The proposed amendments to the Territorial Lands Act are focused on enhancing environmental protection through increased and modernized fines and the introduction of an administrative monetary penalty regime, which is a civil penalty regime. The amendments to the Territorial Lands Act will come into force on royal assent; however, the administrative and monetary penalty regime will only be operational once regulations are in place.

Part 3 of the bill, and the second component of the regulatory improvement initiative, is the Northwest Territories Waters Act. It is important to note that this act will be repealed by Canada and mirrored by the Government of the Northwest Territories upon devolution. Large components of this act will then be imported into the Mackenzie Valley Resource Management Act to enable the continued issuance of water licenses on federal lands post-devolution.

The amendments to the Northwest Territories Waters Act would introduce beginning-to-end time limits on water licences: nine months for a board to issue its decision, 45 days for a minister to make a decision, and then a potential extension of an additional 45 days. It's being introduced as some amendments to address regulatory burdens. It would allow the water board to issue life-of-water licences. Currently those licenses are limited to 25 years. It would introduce regulation making authority for cost recovery. With respect to enhanced environmental protections, it would, like the Territorial Lands Act, increase and modernize fines and introduce an administrative monetary penalty regime.

The existing Northwest Territories Water Board would be renamed the Inuvialuit Water Board, reflective of its geographic scope and location, and the membership would be reduced from nine members to five.

This brings me to part 4 of the bill, the Mackenzie Valley Resource Management Act. The Mackenzie Valley Resource Management Act would also introduce beginning-to-end time limits. This would be for both water licenses, as those elements would be imported into the act post-devolution when the waters act is imported, and for environmental assessments: 12 months for an environmental assessment without a hearing, 21 months for an environmental assessment with a hearing, and 24 months for an environmental impact review or a joint panel review.

The bill would also introduce elements such as cost recovery and a regulation making authority for cost recovery. It would enable the Mackenzie Valley Environmental Impact Review Board to establish a public registry. That board currently has a registry but it has no legislative source for that registry so introducing this would give it greater clarity in terms of what it can and cannot post on its site.

With respect to the environmental protections, the MVRMA would also have amendments introduced to it to introduce an administrative monetary penalty scheme. This scheme would see fines for infractions by individuals of up to $25,000, and by organizations of up to $100,000.

It would introduce a development certificate, which would be one place for all terms and conditions that a proponent must follow in order for a project to proceed to be published. These development certificates would be enforceable. That is, an administrative monetary penalty scheme could be applied to an infraction or a failure to meet the terms and conditions of a development certificate.

Like the Territorial Lands Act and the waters act, fines would also be increased for infractions related to land. The fines would be increased from $15,000 to $100,000 for a first offence, and there would be an introduction of a second offence with a maximum fine of $200,000.

For water infractions, the maximum fine would be increased to $250,000 for a first offence, and $500,000 for a second offence.

With respect to reducing the regulatory burden, the amendments to the MVRMA would restructure the land and water boards, consolidating the existing four boards into one, with an eleven-member board.

It's important to note that the existing mandate of the Mackenzie Valley Land and Water Board would not change as a result of these amendments.

There are varying coming-into-force dates for the amendments to the Mackenzie Valley Resource Management Act. The varying dates have been established to allow for orderly transition to a restructured Mackenzie Valley Land and Water Board and the introduction of new concepts such as an administrative monetary penalty and development certificates.

Another element that is being introduced to the act is the regulation-making authority with respect to aboriginal consultation. This is something that responds to comments from industry, aboriginal groups, government, and boards. It would be an opportunity to put in place regulations that would address the procedural requirements of consultation.

I'll leave it there in terms of the scope of the amendments. What I will say is that as a result of the consultations on this part of the bill, we have made a number of accommodations and changes to the bill to respond to comments received. I'd be happy to speak to those during the question period.

Thank you.

[The Chair, Conservative, Chris Warkentin]

Thank you very much for your opening statements.

We certainly appreciate you making the time available. I know this is a busy time for all of you, and we do appreciate you coming.

Mr. Bevington, we'll start with you for the first round of questions.

[Dennis Bevington, NDP, Western Arctic, NT]

Thank you, Mr. Chair.

Thank you to the witnesses for being here today.

You talked about the key elements in the bill—I'll be speaking a bit to the Mackenzie Valley Resource Management Act—and you said here that the Mackenzie Valley Resource Management Act will remain federal legislation following devolution, but its operation and devolved environment will be reviewed five years after devolution.

Is that part of the bill?

[Wayne Walsh]

No, that's part of the commitment that made—

[Dennis Bevington, NDP, Western Arctic, NT]

So it really is not part of this bill at all.

[Wayne Walsh]

The commitment in the devolution agreement is for the parties to review the provisions of the Mackenzie Valley Resource Management Act as they're treated in the devolution agreement.

[Dennis Bevington, NDP, Western Arctic, NT]

Could you read out for me what the agreement says, just so we get this straight? You've presented it as a key element of the bill here, but it doesn't exist in the bill. I would also ask you, why would you have presented it in this fashion?

[Wayne Walsh]

Section 3.18 of the devolution agreement states quite clearly that:

No earlier than the fifth anniversary of the Transfer Date, the Parties shall conduct a review of the provisions of this Agreement respecting the Mackenzie Valley Resource Management Act (Canada). As soon as is practicable after such fifth anniversary of the Transfer Date, the Parties shall commence negotiations to develop terms for such review as mutually agreed by the Parties, which terms may include a review by an independent third party mutually agreed to by the Parties. Such review shall be carried out in accordance with the terms agreed to by the Parties.

[Dennis Bevington, NDP, Western Arctic, NT]

So there are no terms for the review yet?

[Wayne Walsh]

That's correct.

[Dennis Bevington, NDP, Western Arctic, NT]

And there's nothing in legislation that drives the review?

[Wayne Walsh]

That's correct.

[Dennis Bevington, NDP, Western Arctic, NT]

So the review really has not been established in any fashion at all, other than that there is a provision saying no sooner than five years after the imposition of the bill.

Is there a date that says but no later than 10 years?

[Wayne Walsh]

The devolution agreement itself is a legally binding document. All parties are bound by it.

What the agreement states is that no sooner than five years—

[Dennis Bevington, NDP, Western Arctic, NT]

It's only no sooner than five years.

[Wayne Walsh]

That's correct.

[Dennis Bevington, NDP, Western Arctic, NT]

So the government doesn't have to deal with it sooner than five years, but there's no time in which it has to deal with it.

[Wayne Walsh]

The agreement is silent as to the extent beyond the five years.

[Dennis Bevington, NDP, Western Arctic, NT]

That sounds like a really strong review.

Why wasn't it put into the legislation?

[Tom Isaac, Senior Counsel, Negotiations, Northern Affairs and Federal Interlocutor, Department of Justice]

There's no requirement to put it into the legislation because it's not a legislative review on its terms. The terms of the review are to be mutually agreed to by the parties.

The subject of the review, as expressed in the devolution agreement, is the treatment of the MVRMA in the agreement itself. There was no requirement to put that in legislation.

[Dennis Bevington, NDP, Western Arctic, NT]

There really is no agreement on the terms of the review. There's no agreement on the deadline for a review, other than it can't be before five years. This is a very tenuous review, to say the least.

Another question I have is along the same line. You have a provision in the act that certain requirements for the commissioner's powers will be deleted after 10 years. Is there any reason that you chose to subject the Government of the Northwest Territories to a 10-year period of time in which the commissioner will be instructed by written means from the federal minister?

Is there any reason that you picked that 10-year time, other than the fact that the Yukon had it 10 years ago? Do you consider the development of the Yukon and the Northwest Territories to be similar? Do you consider that the Northwest Territories is in the position that the Yukon was 10 years ago? What thought went into this?

[Wayne Walsh]

Thank you. There were a lot of questions there.

The modernization exercise that we undertook in the bill was both at the request of the Government of Canada and the Government of the Northwest Territories. We were asked to modernize the bill in a similar fashion as was done in the Yukon at the request of the Government of the Northwest Territories.

[Dennis Bevington, NDP, Western Arctic, NT]

Why did you not include a clause like the Nunavut agreement, where written instructions are to be tabled by the commissioner to the executive council?