Indigenous and Northern Affairs Committee on Oct. 27th, 2009

[Paul Thompson]

I've mentioned a number of the ASEP projects that we already have in place. There is some new funding, and we're continuing to look at proposals. There remain further opportunities for investment in the north. We're optimistic in particular about the future of the natural resource sector in the north and all the employment opportunities that come from that. So we are looking at further investment opportunities with ASEP.

I did mention that ASEP was a longer-term initiative. I think that would be even more so in the north. Many of the challenges are, as I was indicating, very interrelated. There perhaps is more in-depth training required if the local labour force is not job-ready. There has to be some deeper investment in essential skills to get to the point where the individual is job-ready. It may require more than classroom training; it may require more innovative approaches, such as coaching and mentoring.

One thing that all these ASEP projects are resulting in is that they're learning from each other as they go too. For some of these innovative approaches, both for the delivery of training and retaining aboriginal people in the workforce, the best practices are frequently shared and identified amongst the players so that we can get even better results out of the programs.

[Earl Dreeshen, Conservative, Red Deer, AB]

That's great. Again, my thoughts as an educator are that you want to make sure you have literacy there at the beginning, so that they're able to utilize as much as they possibly can afterwards.

I have another question having to do with post-secondary education. I'm new on the committee and I'm not 100% sure what types of opportunities exist for those from the northern communities. Is assistance available for people when they leave their communities to pursue post-secondary education?

[Chris Forbes]

There are a couple of things.

First of all, we do provide assistance through the larger block transfers. We have the territorial formula financing, which the territories have the flexibility to use as they see fit. We have the Canada social transfer, a portion of which is to cover post-secondary education. Then you move into specific programs at the federal level, such as Canada student loans program, which Mr. Thompson can talk about.

[Paul Thompson]

There's a suite of measures that are delivered collaboratively with provincial and territorial governments around student financial assistance and the Canada student loans. They underwent a significant reform and renewal in budget 2008, with the availability of a much larger grant for lower-income recipients, so a significant range of programming is available as financial support for people across the country, including the territories.

[Earl Dreeshen, Conservative, Red Deer, AB]

Good.

The other thing I wanted to bring to people's attention is the different modes of educational delivery that are coming. Hopefully people will be able to tie some of that in. It's not the old days of the correspondence schools. Although they had some significance for those in remote areas, a lot of other things are out there, especially the opportunities we have over the Internet. Could you expand on those delivery methods? I would hope that somewhere along the line people are trying to tie these things in. Perhaps industry is looking at it as well, and saying it is important to them. That's really my comment.

In whatever time we have left, could you comment on that aspect?

[Paul Thompson]

Absolutely.

We're seeing some very innovative approaches being developed across the country, developments that blur the lines between formal classroom training followed by an abrupt transition into the workplace. That's not the model that generates results all the time, so we are looking at models that have a much more active role for the workplace in delivering training and that make much more active use of technology to deliver the training.

I'm repeating myself, but those kinds of new approaches are really based on the partnerships that can be developed among employers, educational institutions, and training providers, so that we can see who's best placed with the technology and the infrastructure to meet the needs. We're seeing those examples coming out of different projects.

[The Chair, Conservative, Bruce Stanton]

Thanks, Mr. Dreeshen. I appreciate it.

Let's go now to Mr. Bevington, who will be followed by Mr. Payne.

Go ahead, Mr. Bevington.

[Dennis Bevington, NDP, Western Arctic, NT]

Some of the tax incentives in place for the mining industry in the north are pretty good. They get a break on royalties until their capital costs are written off, correct?

[Chris Forbes]

I'm not actually familiar with the corporate tax system. I'd have to get back to you on that aspect.

[Dennis Bevington, NDP, Western Arctic, NT]

Okay.

Right now our Government of the Northwest Territories is engaged in developing a hydroelectric system to service the mines in the Slave geological province. Is there room within that provision to provide that same capital cost writeoff to the provision of services to the mine, or would there be a necessity for the mining company to actually own the capital infrastructure of that development? It's a technical issue, and if you can come back to us with an answer--

[Chris Forbes]

We'll have to come back to you on that question also. It's a bit technical.

[Dennis Bevington, NDP, Western Arctic, NT]

Okay, thanks.

Another issue deals with the net fiscal benefit. Can you describe the government's position now on net fiscal benefits to the north? If it is under negotiation, what is its status?

[Chris Forbes]

The negotiations between the government and the Northwest Territories on devolution more broadly are ongoing. Those are led by Indian and Northern Affairs Canada on behalf of the Government of Canada.

On our approach on resource revenue sharing, the principles and the net fiscal benefit were actually laid out in the budget 2007. I can read that to you, if you like. Those are there, and they're consistent with the approach we've taken under equalization, the 50% inclusion under equalization.

[Dennis Bevington, NDP, Western Arctic, NT]

Under the present formula, if the territorial governments raise taxes, is there still a measure of clawback engaged with new taxation in the Northwest Territories, the Yukon, or Nunavut?

[Chris Forbes]

The way the formula works is that we're measuring their gross expenditure needs. We have a measure of their expenditure needs that starts with their 2006-07 base, and we grow that forward. Then we deduct from that what we call their revenue-raising capacity. The extent to which the economy expands or contracts in the north is what affects their revenue measure under the formula.

There is a 30% economic development incentive. They do get to keep 30% of that measured revenue capacity as the economy expands. So there is incentive there.

[Dennis Bevington, NDP, Western Arctic, NT]

In the case now, if you had a declining economy and governments wanted to raise taxes to balance their potential deficits, how would that play out?

[Chris Forbes]

There are two things. First of all, the territories are protected from about 70% of the economic decline because it's measured as the shrinking capacity. So they're exposed to 30%. But if they raised their taxes they would keep that, and it would help them offset any fiscal costs.

[Dennis Bevington, NDP, Western Arctic, NT]

You outline the dollars you provide to the three territories. What is the corresponding return to the federal government through resources, taxation, and all other sources?

[Chris Forbes]

I don't have any information with me. I'd have to check whether the provincial economic accounts divide those up with the territories. I don't have any numbers in front of me, for example, for tax revenues from the territories. I have nothing with me, so I couldn't really answer that.

[Dennis Bevington, NDP, Western Arctic, NT]

That might be something else to provide to the committee as a clear indication of how well the territories are doing in returning tax or revenue to the federal government, in terms of that formula.

[Chris Forbes]

Again, the purpose of the formula is largely to help provide services. So we're not looking for, if you will, a direct return on that. But certainly we could provide you with information about estimates. I'll have to check if Statistics Canada breaks down revenues from each provincial jurisdiction.

[The Chair, Conservative, Bruce Stanton]

Thank you, Mr. Bevington.

We'll go to the last questioner in the second round. We'll go to Mr. Payne, and then we'll have time for probably two or three more questions.

Mr. Payne, for five minutes.

[LaVar Payne, Conservative, Medicine Hat, AB]

Thank you, Mr. Chairman.

I welcome you to this session. You have provided our committee with some pretty important information.

I'm interested in some of the programs HRSDC has been talking about, in particular through the aboriginal human resources development strategy. I noted in your comments that you indicated that since 1999, 42,000 aboriginal Canadians have returned to school. In that regard, I'm wondering if you could expand on how you are actually reaching out and targeting the youth for some of these programs in the north.

[Paul Thompson]

Yes, a number of our programs have particular application to the north. As I was indicating earlier, one of our largest investments is indeed through AHRDS, in which we have over $340 million per year across the country in aboriginal labour market development. You cited the numbers, that it resulted in 42,000 aboriginal Canadians returning to school and over 135,000 clients returning to work. So there have been some fairly significant numbers as a result.

These programs are delivered through 400 points of service nationally. I think this speaks to a theme that was raised earlier about the importance of local flexibility. Youth programming is a priority area within the AHRDS, and there is some autonomy on the ground to determine the extent to which they invest in that area. But given the demographics of the aboriginal population anywhere in the country, particularly in the north, we're seeing that a very significant portion of programming through AHRDS is actually serving the needs of youth.

On top of that, there are other investments specifically targeted for youth. We spoke earlier about the youth employment strategy, which is a critical instrument, with various component parts that meet the needs of young people across the country, including in the north.

[LaVar Payne, Conservative, Medicine Hat, AB]

I was also wondering if you could maybe expand on the importance of partnerships with educational institutions, such as Yukon College, and the training they offer in particular, and where they would be provided on a local basis.