Rankin Inlet (Apr 11/05) - The Government of Nunavut (GN) has 21 million reasons why it should exercise its options on the fuel-supply and dry-cargo contracts at the end of this fiscal year.

That's the message the Kivalliq Chamber of Commerce heard during its annual general meeting in Rankin Inlet this past month.

Community and Government Services (CGS) assistant deputy minister Shawn Maley told chamber members that despite the savings and positive feedback, cabinet has not made a decision on whether to exercise the two-year options.

Maley said a rigorous review process is ongoing with each contract and a decision will be made later this year.

He said the GN realizes making changes to supply routes and carriers significantly impacts the private sector, municipalities and residents.

"When the GN was looking at the sealift process in 2002, it was obvious that although the system had been around for a long time, it was extremely expensive," said Maley.

"A decision was made to go to a public tendering process and split dry goods and the fuel resupply."

Maley said after the tenders were reviewed and awarded, it was estimated the decision had the potential to save the GN in excess of $19 million over the life of the three-year contracts.

"We're now two years in and that estimate has increased to $21 million.

"The GN is always faced with the challenge of balancing expenditure reduction and fiscal responsibility against respecting history and the way business has been conducted in the past."

While the majority of savings have come from the fuel supply, the dry-cargo contract is also realizing substantial savings, CGS director of financial services Mike Rafter told the chamber.

He said the accumulated savings have allowed the government to address other needs the territory is faced with.

"During the review processes, we've held discussions with a number of major public and private sector supply users," said Rafter.

"While there are some concerns, there has been a general level of satisfaction across the territory with the marshalling, packaging, sealift carriage and local cartage of stakeholder goods.

"The GN is listening to those concerns and making an effort to review the issues that impact the Kivalliq."