Jake Kennedy
Northern News Services

Yellowknife (Oct 28/02) - Bill Aho moved to the NWT in the late 1980s so his Edmonton-based construction company from could take advantage of the NWT's Business Incentive Policy.

He soon became president of the NWT Construction Association, fighting for the rights of Northern building firms in getting a fair shake when bidding for contracts.

Yellowknifelife: First of all, can you explain what the Business Incentive Policy (BIP) is?

Bill Aho: The BIP is a policy of the government of the Northwest Territories. It's designed to level the playing field, so that Northern contractors aren't at a disadvantage to the southern contractors. So, basically, it's just a means of off-setting the additional overhead costs of a Northern contractor, so that they can compete with a southern contractor.

Yellowknifelife: What are some of those additional costs that need to be offset?

BA: The cost of living is higher in the NWT than in the South. Simply look at power rates, housing costs, rent costs and any other sort of overhead cost. Any of the services that you purchase, you pay more.

So basically, the cost of maintaining people is higher. In the South they don't pay any subsistence or housing or living allowances. In order to maintain staff, we do have to provide those. We're at a competitive disadvantage.

You know, a contractor from the South has no investment here. They come in from the South, take their pick of contracts, and that's it. They basically tender on a job, come up, do it, and leave. They don't support the local junior hockey team, they don't support the curling club.

They don't have an office, or an infrastructure in place so that if your furnace goes out in the night, you can simply pick up a phone and they'll be able to fix it. So, a Northern contractor has that in place. They have their trucks here, they have phones here, they have people here -- so if citizens of the NWT need their services, it's there. That's the intention of the BIP, to help offset that infrastructure cost so a contractor can compete and be successful.

Yellowknifelife: The BIP sounds like something that everyone would agree with. But some people don't agree with it. So, where does the controversy come from?

BA: There's probably two areas that there's been controversy over, depending on which government is in place. Different governments have used BIP for different means. It's been used at times for economic development for small communities, as opposed to the NWT as a whole.

The other controversy is the requirement of qualifying as a Northern business. Whenever rules are established, there's always a means of getting around those rules. That's one of the biggest controversies, southern contractors actually qualifying under the BIP.

Technically, on paper, they meet the requirements -- like 51-per-cent Northern ownership, and a phone number -- but they don't actually meet the spirit and the intent of it. You pick up the phone, and you phone and get someone who's just acting as resident manager. They don't have a truck in town, they don't buy from any of our suppliers and you can't get them to do anything.

Yellowknifelife: How have you seen the construction business change since you've been here?

BA: When I first came here, there were a number of sub-trades that weren't available in the North, we simply had to contract them from the South. And since then, in the construction industry, there's been a number of contractors that have established themselves in these fields that weren't available previously.

Yellowknifelife: What would you say the current climate for the construction business in the NWT is like?

BA: The economy is booming. Construction is going flat-out right now. Everyone is going flat-out and accomplishing everything they can.

Yellowknifelife: What do you think of the government waiving the BIP on Phase II of the new correctional centre?

BA: We're not in favour of that. If you have a policy, and use it on an ad hoc basis, industry cannot make decisions based on that. Either you have a policy, or you don't have a policy.

It played out as we suspected though, and as a matter-of-fact a substantial number of the contracts went to Northern businesses anyways. The only thing it proved is that Northern contractors have to sit down and take a look at their pricing. Compared to their Southern competitors, their pricing is low.

Yellowknifelife: If waiving the BIP showed that we are competitive anyways, doesn't that just show that the policy isn't needed?

BA: I guess if you're content with the way the industry is, and the growth of the NWT as a whole, if you say to me things are the way you want them to be forever -- then, yes. But, there are a number of disciplines that are still not available in the NWT. The BIP has proven to provide that. Ten years ago we didn't have any sprinkler contractors in the NWT, now we have two, as an example.

If our economy is going to continue to grow, and our industry is going to continue to grow, we need to make sure these disciplines are around.