YELLOWKNIFE (February 8, 2016) – Premier Bob McLeod announced today that Cabinet has initiated the process for working with Members of the 18th Legislative Assembly (MLAs) to determine prudent and responsible solutions to the financial challenges identified by the Government of the Northwest Territories (GNWT). The announcement follows meetings between Minister of Finance Robert C. McLeod and the Standing Committee on Priorities and Planning (SCOPP) to review the GNWT’s fiscal forecast for the next several years, as well as Caucus review of the draft GNWT mandate.
“Slow economic growth and weakening prices for natural resources means that the GNWT’s revenues are not expected to see much growth over the next five to ten years,” said Minister McLeod. “At the same time, government expenditures have been growing due to increased costs and rising expectations for programs and services. We need to act now while the problem is still manageable so we can ensure the future financial stability of the GNWT.”
Projected budget deficits, which could emerge as soon as 2018-19, will erode the GNWT’s ability to sustain programs and services currently required by the people of the Northwest Territories and eliminate the funding needed under the Fiscal Responsibility Policy to invest in infrastructure, including participating in the Government of Canada’s Building Canada Plan. Increased borrowing to fund capital projects or pay for unexpected expenditures, like recent record fire seasons and low water in the Snare Hydro System, will bring the GNWT closer to its federally imposed debt limit and make it impossible to absorb further unexpected costs.
“We owe it to the people of the Northwest Territories to do the right thing and make responsible decisions that will return the GNWT to a fiscally sustainable path,” said Premier McLeod. “Taking decisive action now will keep the problem from getting bigger and allow us to potentially free up additional resources in the final two years of this Assembly to help fund new initiatives.”
The GNWT is committed to working closely with MLAs to identify practical solutions to the fiscal challenge. The GNWT will develop proposals and share them with MLAs for input prior to the preparation of business plans later this year. Business plans will undergo Standing Committee review before forming the basis of the 2016-2017 Main Estimates.
MLAs will have an opportunity to thoroughly review and publicly debate the GNWT’s proposed budget before voting on the Main Estimates when they are introduced in the May-June sitting of the Legislative Assembly.
“We need to make sure that the plans we are making to implement the priorities of the Legislative Assembly can be paid for,” said Premier McLeod. “That will mean working together with Regular MLAs to develop solutions to the financial problem facing us that take the needs of residents and the territory into account, while ensuring the long-term sustainability of GNWT operations for future generations. We are at the beginning of the process and will continue to work with MLAs to get their views and those of the people they are elected to represent. Ultimately, any plan will have to be approved by the Legislative Assembly when it votes on the Main Estimates later this year.”
Media inquiries:
Andrew Livingstone
Senior Cabinet Communications Advisor
Department of Executive
Government of the Northwest Territories
Tel: 867-767-9140 ext. 11092
Email: andrew_livingstone@gov.nt.ca
