Indigenous and Northern Affairs Committee on May 8th, 2024

[Gary Bell]

They went up 30%, and have only gone down 6% this year.

[Jamie Schmale, Conservative, Haliburton—Kawartha Lakes—Brock, ON]

Wow. Okay.

We have more taxes being increased, more fees, more regulations and more rules.

Give us a simple solution to this pilot problem.

[Gary Bell]

We would say, instead of restricting the pilots' duty day, simply change it so that when the pilots report for duty, that's when their duty day starts, instead of changing the number of hours they can operate in a day.

[Jamie Schmale, Conservative, Haliburton—Kawartha Lakes—Brock, ON]

Now, this is—

[The Chair, Liberal, John Aldag]

That's the end of the five minutes.

We'll move now to Mr. McLeod for his five minutes.

[Michael McLeod, Liberal, Northwest Territories, NT]

Thank you, Mr. Chair.

Thank you to the witnesses for joining us here today to talk about nutrition north.

I represent the Northwest Territories, and I certainly recognize the cost of freight and travel there.

I received a copy of a plane ticket from an individual. Actually, he sent me two copies of tickets. One was for one person travelling from Norman Wells to Yellowknife. The cost of that ticket was $1,859 for a flight that's a little over an hour. I then got a copy of a ticket for two people flying Air North from Yellowknife to Whitehorse, which takes two hours, and it was only about $630.

Could you explain to me why different airlines have such a difference in cost? I assume it's the same when it comes to freight.

[Shelly De Caria]

You can access the Yukon by road. In all of the communities we serve—25 of which are isolated—we invest in the infrastructure, maintenance and everything that comes with the airline industry.

We're not just doing a hub city on a jet. We're also doing the ATR services that we accommodate as an essential service. That cost cannot be completely subsidized by the jet service. We operate a jet and the ATR going into isolated communities. There is no road access to many of them. Offsetting the cost from there, which is higher, we've had to make—

[Michael McLeod, Liberal, Northwest Territories, NT]

Your cost doesn't include carbon pricing on the fuel, because we're exempt. All three territories are exempt. Aviation fuel is exempt for our airlines. That's not factored in the equation. Is that right?

[Shelly De Caria]

No, it's not factored in the equation.

We have different fare structures. The 14-day advance purchase versus the seven-day advance purchase and the “day of” purchase are completely different. We take into account all the other communities we're serving, not just the hub cities.

[Michael McLeod, Liberal, Northwest Territories, NT]

I want to ask Dan McConnell a question about how he applies the subsidy in some of the communities. Is it a flat rate that you apply, in terms of a percentage, on the foods that qualify?

I ask this question because I get complaints from the communities of Fort Simpson and Nahanni Butte, where they have seasonal subsidies. The community of Fort Simpson only receives subsidies during the breakup and freeze-up. Your stores then take the subsidy they get—which is usually about a month for breakup and a month for freeze-up—and apply them across the board, I was told, over a year.

Is that correct? Do I understand that correctly?

[Dan McConnell]

The mechanics are actually preprescribed for us. We get it. It's allocated to a product, and we just pass the amount right through to the customer. For the mechanics behind it and the formulaic approach, you'd probably have to speak to the nutrition north administration.

Whatever we get is predetermined for the product, and we just pass it right through to the customer.

[Michael McLeod, Liberal, Northwest Territories, NT]

In those communities, there are huge spikes. October comes, the river starts freezing up, and everything has to come across with a helicopter. There's a huge spike, and then the complaints start coming in because we don't see the subsidies increase with the freight cost. It's the same in the breakup.

Is there a way to focus on the times when the costs jump way up and cause all kinds of problems?

[Dan McConnell]

I think that would be a conversation with nutrition north to understand how we can start to align it more with some of those peak periods. Again, we're just a flow-through. We don't make the rules on how it gets administrated.

[Michael McLeod, Liberal, Northwest Territories, NT]

I want to ask about climate change and its impact on some of your costs. As you know very well, last year we didn't even get the chance to take the buoys out of the river. The river was drying out, so they pulled all the tugs out and we couldn't move any of the freight. This year it looks like it will be even worse. We're looking at maybe shutting down ferries, never mind the tugs that come up and down the river.

Climate change is drying up our rivers in the north. The Nahanni River, the Mackenzie River, the Hay River—they're all at extreme and historic lows. Do you expect that this will cause you to require even more subsidy than what you're getting now in terms of the costs?

[The Chair, Liberal, John Aldag]

We're out of time, but I'll allow a brief response.

[Dan McConnell]

I would say the answer is yes. I'd love to expand on that more, because that's not the only place where climate change has impacted our business. In engineering and a number of other things, there have been significant negative impacts on our infrastructure within the communities we serve. The answer is yes.

[The Chair, Liberal, John Aldag]

Thank you.

We'll go now to Monsieur Lemire for two and a half minutes.

[Sébastien Lemire, Bloc, Abitibi—Témiscamingue, QC]

Thank you, Mr. Chair.

Mr. McConnell, I will continue the discussion with you.

First nations communities in the south often try to find solutions for feeding the northern communities. These days, businesses are making efforts to reinvent themselves and to review current systems, especially supply systems. It is rather sad to see Australian berry juice on your shelves when you could be promoting products from local or first nations businesses.

How important are distribution and Canadian-made products to you?

[Dan McConnell]

Can you just repeat the part about Australia?

[Sébastien Lemire, Bloc, Abitibi—Témiscamingue, QC]

I was saying that juice from Australia ended up on your shelves when we should instead be promoting Canadian products. I am thinking about Oasis juice from Quebec. Why are you being supplied by companies that are not Canadian?

In fact, should the Nutrition North Canada program, which seeks to ensure food security in Canada, not emphasize Canadian products or give them an advantage? I would be curious to know your thoughts on that.

[Dan McConnell]

I'm not familiar with the Australian juice, but I can tell you that we absolutely go for the most economic products that we can to be able to pass on that value to our customer. If there's an Australian juice on there, I would imagine it's because it's selling. The customers are asking for it and it's a cost-effective solution for us to offer.

[Sébastien Lemire, Bloc, Abitibi—Témiscamingue, QC]

Does your company have a procurement policy that favours the purchase of Canadian products from within a shorter distance, ultimately?

[Dan McConnell]

We don't have it in relation to Canadian products necessarily, but we do have it around indigenous-led and indigenous-managed companies. Actually, we've had some really strong success around that.

As far as Canada is concerned, we're a proud Canadian company. By all means, all things being equal, we would definitely proceed with the Canadian company to be able to support that as best we could.

[Sébastien Lemire, Bloc, Abitibi—Témiscamingue, QC]

I will repeat my question.

Since it is hard to make food profitable in remote regions, especially in the north, should Nutrition North Canada be focused more on Canadian companies that want to have access to your market to sell their products on your shelves? Is that where Nutrition North Canada subsidies should go, in order to supply people with lower-priced products?

[Dan McConnell]

I think I would align with the second part of your statement. Definitely it should be geared toward having more affordable products for customers. As to where the product comes from, I'm not sure that would align. I think the first mode of business should be getting more affordable product to customers within the north.