The Yukon government has no plans to privatize the maintenance of the Dempster Highway, says Allan Nixon, the territory's assistant deputy minister of Transportation.

"We're not interested in contracting out or privatizing the maintenance of public highways ... basically we think we do a pretty good job of it,” Nixon told the Star this morning. "We're cost-effective and we've got talented and skilled people (doing the work).”

Nixon made the remarks a day after two First Nations inked a deal to work with the Public Service Alliance of Canada's (PSAC's) local bargaining agent, the Yukon Employees Union (YEU), to extract, among other things, just such a contract.

Nixon said Highways and Public Works Minister Archie Lang communicated the same message – that maintenance of public highways would not be tendered – in a November 2010 letter to the First Nations of Tr'ondek Hwech'in and Na-cho Nyak Dun.

On Monday, chiefs for those First Nations – Eddie Taylor and Simon Mervyn, respectively – touted their memorandum of understanding with the YEU and PSAC that both believe would provide the necessary leverage for such a concession.

Citing the Umbrella Final Agreement – the framework for settled land claim and self-government agreements – Mervyn said, "it's clear ... that we should have privy (to that contract) with regards to Chapter 22.”

While that chapter is meant to provide signatories "economic opportunities” within the Yukon economy, there is nothing obligating the territorial or federal governments to provide preferential treatment or sole-sourced contracts.

The chiefs and the unions contend the territorial government is using collective agreements as a barrier to devolving service provision to the First Nations, and now that they have the MOU, Taylor said, "...it proves they're not an impediment.”

But Nixon said privatizing the maintenance of the Dempster Highway would take much more than an MOU that indicated the union was on board.

"I don't see anything in the MOU that says the union has spoken to actual employees,” Nixon said.

"If we said this was going to occur, how many employees would be going?

"And for the ones who chose not to go, we would be responsible to employ them somewhere else,” Nixon said.

He counted the disposal of assets and the liability issues with privatization of a major road as more hurdles.

In 2008/2009, the government spent $4.7 million maintaining the Dempster Highway inside territorial boundaries

A year later, that figure was $4.8 million, and for this fiscal year, the government has spent $4.3 million to date.

These figures do not include overhead for keeping three transportation services branch base stations along the Dempster at Klondike, Ogilvie and Eagle Plains, which house and supply the 19 workers.

"There seems to be this notion that there's dollars to be made, but the highway business is nickels and dimes per kilometre,” said Nixon, who suggested First Nations look to the private sector.

"Now there's an option for any First Nation to step up and get involved with these mining companies who are looking for support and assistance to upgrade and maintain (access) roads,” Nixon said.

"And it would fill a void that government would have a difficult time with, if we were to upgrade every trail to every mining operation.”

Nixon said it's positive that the union and First Nations are working together, but called the MOU "a big shift in (organized labour) policy, because we're talking about contracting out public services.”