Mr. Silver: Last year, the government provided funding for a feasibility study for a second fibre optic line in the Yukon. Yukoners are well aware of what happens when a backhoe down south digs up the one line that we do have.
When the minister announced the project last year, he said — and I quote: “An alternate fibre optic link would improve the availability and reliability of communications services and enable competition and innovation in the telecommunications sector in Yukon.”
Mr. Speaker, the funding went to Dempster Energy Services, with no competition. I don’t believe that a copy of the funding arrangement has ever been made public. How much did the government provide for the study and what funding envelope specifically did this come out of?
Hon. Mr. Dixon: Mr. Speaker, last year three First Nation development corporations under the aegis of Dempster Energy Services approached the department seeking funding for a study on the feasibility of an alternate fibre link to the south. The proposal met the criteria of the specific funding program and as such, it was supported financially by the department. I believe the financial amount was around $100,000, but I stand to be corrected on the exact number.
That study has since concluded. I should note that the Yukon government remains very interested in the development of a second fibre line to the south. To that end, we have allocated $600,000 to take the next steps toward the development of that project in this year’s budget.
Both the Premier and I have indicated that this could be an excellent opportunity for a partnership with First Nation development corporations. We remain interested in that possibility and we look forward to exploring opportunities with a number of different development corporations throughout the Yukon to advance this very important project.
Mr. Silver: There is more money for this project in this year’s budget. The budget speech did say that Dempster Energy Services is a partnership with three First Nation development corporations. Our government is providing $600,000 in this budget, together with $150,000 from First Nation development corporations, to prepare a business case for building a second fibre optic data cable connection to the south.
On April 17, the Minister of Economic Development said the $600,000 identified in the budget is not committed to Dempster Energy. These statements are, of course, contradictory. The Premier said in the budget speech that a partnership between Dempster Energy Services and three development corporations was already in place and the development corporations had agreed to kick in $150,000 of their own money.
The minister backed away from that commitment and said that a decision hasn’t been made. So can the Premier explain the contradiction?
Hon. Mr. Dixon: There is a fairly simple explanation. The Dempster Energy Services group of First Nation development corporations was provided funding initially to do the particular study that I answered about in the first case. The $600,000 that’s identified in this year’s budget is for the development of this project, but it is not limited to those First Nation development corporations in Dempster Energy Services.
We think that this particular project is one that could be of interest to a number of different First Nation development corporations, and we hope to see their involvement in the future, but we haven’t made a decision about what the exact ownership model or business development plan will be for this project.
I’m not in a position to indicate what that structure might look like or specifically which First Nation development corporations will be involved. So to conclude my answer to this particular question, Dempster Energy Services was involved in the feasibility study. The next steps of the project involve reaching out to a number of other First Nation development corporations as well. That certainly doesn’t preclude Dempster Energy Services from being involved, and that’s indeed a possibility, of course. As was indicated in the budget speech, we understand that Dempster Energy Services has some funding available, and we will look at funding opportunities to partner on this particular project.
Mr. Silver: You can see our confusion. The budget speech says that $600,000 is already spoken for, and the minister says that is not the case. I would urge the Minister of Economic Development to re-read the budget speech because the Premier has already told him that this money has already been spent. The government started this second fibre optic ball rolling last year with a $60,000 sole-source contract to Dempster Energy Services. Now this arrangement is being extended with another $600,000 being spent with no competition. We need some clarification here.
At the same time, other potential players in the industry are being left on the sidelines by this government, or so it seems based upon contradictory statements. Other First Nation development corporations, Ice Wireless and also Northwestel, seem to be sitting on the sidelines looking in.
Why is the government playing favourites on this potentially multi-million dollar project?
Hon. Mr. Dixon: I need to correct the member opposite. We have not made a decision about the development of the project yet. His characterization of this that we are playing favourites is simply inaccurate. We haven’t made a decision about who will partner with us on the development of this project.
Dempster Energy Services approached the government — the Department of Economic Development — last year with a proposal and a request for funding for a feasibility study. The request met all the funding requirements of the program and as such was funded. That is the conclusion of that particular project.
Moving forward with the development of a business plan for the construction of a fibre line is something that we remain committed to, and have identified funds in this particular budget to the tune of $600,000 to see that project move forward. We hope, and we intend to reach out to First Nation development corporations because we believe earnestly that this is an excellent opportunity for a partnership between Yukon government and First Nation development corporations.
We have not decided which business model to adopt and we have not determined which First Nations development corporations will be involved. Of course, there is also the possibility that private sector companies, like the two he mentioned, could be involved as well. Indeed, there is also the possibility of public investment in this particular project.
I think that this is an infrastructure project that will be of great importance to Yukon in the future and will be of great importance to our efforts to diversify our economy and develop the ICT industry in Yukon.
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