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'Cautious' and 'realistic' budget focuses on basics
Human resources department dissolved, $22-million surplus and 30 new homes to be built

Peter Worden
Northern News Services
Published Friday, March 1, 2013

Finance Minister Keith Peterson announced a "cautious" budget with a razor-thin $22-million surplus, or one per cent of GDP, on Feb. 27 in the legislature. He said the budget is not one the government is campaigning on, even with an election later this year.

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Finance Minister Keith Peterson rises in the legislative assembly last Wednesday to read the year's budget address. - Peter Worden/NNSL photo

"It's focusing on the basics," he said, citing funding for health centres and Iqaluit's Qikiqtani General Hospital, the Iqaluit airport and fuel tank farms in communities. "I only wish I had more funding to assist people."

"These issues of hunger, poverty and homelessness are serious," Peterson said in his budget speech to the legislative assembly. "They are exactly the issues we need to resolve if we are to fulfil our vision of Nunavut."

Stable, realistic budget

The slim projected surplus is the territory's second in a row. The budget includes spending of $1.48 billion, which is slightly less than last year, with revenue increasing by roughly $70 million. Nunavut gets about 90 per cent of its revenue from federal transfers.

The budget is the most "realistic" budget deliverable as "stewards of the public purse," said assistant deputy minister of finance Chris D'Arcy. "There are many different pressures and it's easy to slide into another $40-million deficit. We well understand the needs in the territory and by keeping our house in order it will help."

Peterson called the territory's financial situation "reassuringly stable" and said his department works as best it can with what it has, citing the well-known example of the territory's housing shortage. The GN projects a shortfall of 3,000-4,000 houses with another 90 needed each year. After a year of no new social housing, the territory plans to build again with $13 million in the budget for 30 homes in Arviat, Clyde River and Cambridge Bay.

In addition to housing, the budget spends big on health care typically its biggest bottom line expense every year with about 21 per cent of the total budget. Other highlights include $7 million to promote equal status of Inuktitut, English and French; $4.2 million for hamlets to improve services; $1.4 million for GN assessments of mining projects; an additional $8 million for the Department of Justice with law enforcement initiatives such as improved RCMP Inuit language training; $900,000 for support of the Country Food Distribution Program, which had been on the budgetary menu since a Food Security Symposium held last December; and $1.9 million for the government's new PASS (Pathway for Adult Secondary School) Program, which aims to get adult Inuit back into school.

New department formed

"We recognize education is a key component to get out of poverty," said Peterson, who also explained another major shift in this year's budget, a shakeup of some interdepartmental committees. "We're splitting up the government a bit."

The GN's human resources department no longer exists and a new Department of Family Services was created, which will get a seven-per-cent increase on top of its share of the budget from the old Health and Social Services ministry.

D'Arcy said the departmental changes weren't "costed out" with the aim of saving money or reducing expenditures, although there were a couple positions dispensed with but other positions created.

"We do have the expectation of doing better and more things, so we'll be more efficient," he said.


Another big-ticket item in this year's budget was the possible revenue stream from the iron-ore mine at Mary River, where there's growing anticipation in the territory for a major project. However, Dan Carlson, manager of fiscal policy and analysis for the Department of Finance, said it was not factored into the revenue forecast.

"Until the mine is actually given the go-ahead to produce, and construction starts and finishes, it's safer and more prudent to assume that we won't have the revenue going forward," he said. "We want to make sure that it's very likely that those revenues will actually flow to us."

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