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Handley orders $20M spending cut

Kathleen Lippa
Northern News Services

Yellowknife (May 16/03) - Government departments, tighten your belts. The $300 million debt wall looms, and the only saving grace will be if departments save $20 million by the end of this year.

With a current operating deficit at $81 million (previous forecast was $77 million) things like computer expenses and government travel are all being assessed, department by department.

Cuts to capital projects and government jobs are not in the near future.

That was the message Finance Minister Joe Handley sent Tuesday.

"We are looking at all parts of government," said Handley.

"We are not looking at the kinds of cuts we were looking at in the 1990s. We're not cutting our civil servants."

Handley, along with finance ministers from Nunavut and the Yukon, met with federal Finance Minister John Manley Monday to discuss new formula financing agreements for the territories.

The territories want new deals modelled on the health care agreement where funding based on the number of people is put to rest.

Handley said he wants a new financing agreement settled with the federal government by September 2003.

Manley acknowledged the formula financing agreement the NWT has with the federal government is not adequate, Handley said.

But the NWT minister said Manley would not commit to a new deal.

The "cruelty" of the current per capita funding arrangement the NWT has with Ottawa is that it totally relies on the accuracy of the census. And the census conducted by Statistics Canada missed about 4,000 people last year.

With about $15,000 allotted to each person under the current per capita funding arrangement, roughly $60 million was lost because of the miscount.

Handley said he expects there will be "some kind of compromise" by the end of June.