Evidence of meeting #9 for Indigenous and Northern Affairs in the 41st Parliament, 2nd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was sites.
A recording is available from Parliament.
11:55 a.m.
Conservative
The Chair Conservative Chris Warkentin
Thank you.
We'll turn now to Mr. Strahl for the next five minutes.
11:55 a.m.
Conservative
Mark Strahl Conservative Chilliwack—Fraser Canyon, BC
Thank you.
My apologies for my delay. I was in the House speaking to Bill C-9, the First Nations Elections Act, this morning.
My question stems from the debate that took place on this bill last week. The constant refrain that I heard from the opposition was regarding resource revenues. I'm hoping that perhaps someone at the table can describe what the current pre-devolution regulatory improvement resource revenue system is and what it will become after this bill is implemented. Perhaps, as well, they could talk about what's proposed in Bill C-15 compared to what was taking place in the Yukon territory and therefore what Yukon's reaction was to it. There are a few questions there but I'm hoping you can provide me some answers.
11:55 a.m.
Director, Northwest Territories Devolution Negotiations, Northern Affairs, Department of Indian Affairs and Northern Development
The devolution agreement speaks to a number of different pots of money or revenue streams, for lack of a better term. The first we talk about is one-time funding. Both the Government of the Northwest Territories and aboriginal parties will receive one-time funding in order to get set up for devolution. It's a pure implementation type of cost. For post-devolution we have what we call ongoing funding. Essentially it's an A-base transfer from the Government of Canada to the Government of the Northwest Territories as well as to the aboriginal parties. That enables those governments to undertake and discharge their responsibilities pursuant to the agreement. That amount for the Government of the Northwest Territories is $67.3 million. It will be added to the Territorial Formula Financing agreement, which then grows as part of the index. The ongoing money for the aboriginal governments is up to $4.6 million and that is distributed based on a formula between the aboriginal parties.
With respect to your question on the resource revenue side, the formula that was agreed to in the devolution agreement calls for the Government of the Northwest Territories to collect all royalties in the Mackenzie Valley. They will then return half of those back to the Government of Canada and they will retain 50%. There is a cap on that 50% and the cap is 5% of their gross expenditure base. The way that works is if the gross expenditure base of the Government of the Northwest Territories was $1 billion the most that the Government of the Northwest Territories could retain through the net fiscal benefit formula would be $50 million. It's important to note that the calculation of the gross expenditure base increases every year so that cap also increases every year. It's an important consideration. The reason why it was determined that way is that it's consistent with the federal-provincial type of approach with equalization given, however, that the Territorial Formula Financing tends to be substantially more generous than equalization in the provinces.
It's important to note that this formula was quite different from what was agreed to in the Yukon. When the Government of the Northwest Territories and the Government of Canada signed the agreement in principle in January 2011, there was a request made by the Government of Yukon to modify the Yukon formula to be consistent with the Government of the Northwest Territories formula. The Prime Minister did agree to that and that amendment was made and the devolution Yukon agreement was amended to reflect the new formula that was in the Northwest Territories.
That's the agreement. Currently under pre-devolution, under the current system, Canada collects and retains all royalties that are accrued in the Northwest Territories.
Noon
Conservative
Mark Strahl Conservative Chilliwack—Fraser Canyon, BC
Okay.
This is a significant improvement from that obviously. Again, I haven't been here for the whole time so that's good for me.
Noon
Conservative
The Chair Conservative Chris Warkentin
Thank you.
We'll turn now to Mr. Bevington for the next five minutes.
Noon
NDP
Dennis Bevington NDP Western Arctic, NT
Thanks, Mr. Chair.
I want to go through this MVRMA process a little bit. Bear with me please.
With the devolution agreement, the Government of the Northwest Territories will be taking over responsibility for environment, land, and for making recommendations to the boards. Is that correct? Will they be making recommendations on conditions on the land and conditions with the environment that would have been made previously by the federal government?
Noon
Senior Counsel, Negotiations, Northern Affairs and Federal Interlocutor, Department of Justice
Currently, under the MVRMA there's a concept of “responsible minister”. That concept is for those ministers who have jurisdictional authority for approving a particular project that is the subject of an environmental assessment. Those responsible ministers get together and make a decision on the recommendation that's—
Noon
NDP
Dennis Bevington NDP Western Arctic, NT
No, I'm talking about those who actually sit on the technical committees, who work with the boards to make the recommendations that go forward to the ministers. Is that not the process that still takes place?
Noon
Senior Counsel, Negotiations, Northern Affairs and Federal Interlocutor, Department of Justice
When the assessment itself is being conducted?
Noon
NDP
Dennis Bevington NDP Western Arctic, NT
Yes.
So the Government of the Northwest Territories has a much larger role to play in putting forward the recommendations to the boards. Is that correct?
Noon
Senior Counsel, Negotiations, Northern Affairs and Federal Interlocutor, Department of Justice
Yes, they should.
Noon
NDP
Dennis Bevington NDP Western Arctic, NT
On things like reclamation, on a whole number of issues that would be very important to the people of the north.... Is that correct?
Noon
Senior Counsel, Negotiations, Northern Affairs and Federal Interlocutor, Department of Justice
Yes. There are interventions in those assessments.
Noon
NDP
Dennis Bevington NDP Western Arctic, NT
And the federal government would have less of a role in that regard. Okay, so we have that established. That's happening.
So now the boards themselves are going to be under the direction of the minister. The federal minister may give written policy directions that are binding on the planning boards, on the review boards. Is that correct? So the federal minister has the ability now, much larger in this act than he had before, to provide binding policy direction to the boards that are dealing with environmental assessments.
Noon
Director, Resource Policy and Programs Directorate, Northern Affairs, Department of Indian Affairs and Northern Development
The expansion of policy direction under the MVRMA would be with respect to land use planning boards and the Mackenzie Valley Environmental Impact Review Board, yes.
Noon
NDP
Dennis Bevington NDP Western Arctic, NT
That's the one that does the environmental assessments, and the land use planning board establishes the conditions for environmental assessment. Is that correct?
Noon
Director, Resource Policy and Programs Directorate, Northern Affairs, Department of Indian Affairs and Northern Development
Yes. These boards are remaining federal post-devolution—
Noon
NDP
Dennis Bevington NDP Western Arctic, NT
So we got that now.
So now the Government of the Northwest Territories, in the end, after the environmental assessment is done, is responsible for the condition of the land once the project's finished. Is that correct?
Noon
Director, Resource Policy and Programs Directorate, Northern Affairs, Department of Indian Affairs and Northern Development
For territorial land, yes.
Noon
NDP
Dennis Bevington NDP Western Arctic, NT
So under this act now the minister could make decisions that might not be in the best interests that the Government of the Northwest Territories considers for its land. Is that correct?
Noon
Director, Resource Policy and Programs Directorate, Northern Affairs, Department of Indian Affairs and Northern Development
The minister would only be making decisions with respect to federal lands. Territorial ministers would be making decisions with respect to territorial lands—
Noon
Conservative
The Chair Conservative Chris Warkentin
Mr. Bevington, you have to wait until the question is answered.
Noon
Conservative
The Chair Conservative Chris Warkentin
I'll extend your time if necessary, but it's important that the witness has the time to answer the question.