February 3, 2006
Isolated Posts and Government Housing Committee
The results of the Statistics Canada survey of the Living Costs Differential (LCD) Indexes for the Northwest Territories, Nunavut and Northern British Columbia Region, conducted in February and March 2005, were recently communicated to the National Joint Council Isolated Posts and Government Housing Committee (NJC-IPGHD). While the indexes for the majority of the posts surveyed have either increased or remained at the same level, the indexes for Yellowknife and Rae have decreased by one level. As a result, the LCD allowance will decrease from Level 3 to Level 2 in Rae and from Level 2 to Level 1 in Yellowknife. (See Appendix C: http://www.tbs-sct.gc.ca/pubs_pol/hrpubs/ipgh-dpill/ipghdc_e.asp)
To better inform employees affected by decreases in the LCD, the NJC- IPGHD has undertaken to provide advance notification and explanation of the LCD survey results when indications are that a decrease of the LCD allowance is in order.
Explanation:
According to the agreed to methodology, the Living Costs Differential (LCD) Allowance is paid when the cost of the basket of goods and services at the post exceeds the cost of the basket of goods and services at the base city, in this case Edmonton, by at least 15%.
While the survey conducted by Statistics Canada in 2001 indicated that the cost of a basket of goods and services in Yellowknife and in Rae exceeded the cost of the Edmonton basket of goods and services by 20 to 25%, this gap has now narrowed. The 2005 survey indicates that the cost of the basket of goods and services in Yellowknife and in Rae now exceeds by 15 to 20% the cost of the Edmonton basket of goods and services.
Details regarding the methodology can be found in the "Guide to National Joint Council Rates and Allowances", available at the following web address: http://www.njc-cnm.gc.ca/doc.php?lang=en&did=117
Departmental employees or regional staff should direct any questions on this subject to the appropriate departmental corporate official.
The official information notice will be issued within the next two weeks.