GN’s deficit budget addresses repeated departmental shortfalls

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Finance Minister David Akeeagok delivered his first budget May 28, one with a $28 million deficit to address years-long shortfalls in several key departments, namely Health and Family Services.

Justice also gets a boost.

Michele LeTourneau/NNSL photo
Finance Minister David Akeeagok fields questions from reporters about the budget he delivered May 28 in the legislative assembly.

The projected deficit was a conscious decision, Akeeagok told reporters prior to his budget address in the legislative assembly, noting revenues are not growing at the same pace as programs and services.

“There has been a lot of underfunding. To project a surplus for the sake of projecting a surplus is not reality. There has been consistent overspending in two of our departments and a third one with a need to get their budget base adjusted,” said Akeeagok.

The previous government predicted a $2 million surplus for a $1.91 billion budget in 2017-2018, but left behind a $39 million deficit, a number to be finalized in June.

The current government projects total spending at $2.201 billion, and total revenues at $2.177 billion, $1.671 coming by way of federal transfers.

The government is earmarking $30 million for contingencies.

“If a school burns down, that will eat up (the contingency). If there’s way more medevacs and medical travel … those are things we need to build into our contingency,” said Akeeagok.

But overall, Nunavut’s economy is growing, and looks to outpace the nation in 2018.

“The Conference Board of Canada estimates that Nunavut’s real (gross domestic product) will grow 4.4 per cent in 2018 and 9.1 per cent in 2019. This is much greater that the 2.1 per cent growth projected for Canada as a whole and the 2.0 per cent growth projected nationally in 2019,” he said in his address.

 

Budget highlights

Health receives $1.5 million over three years to run two operating rooms simultaneously and for longer hours, $1.6 million over three years to enhance hearing assessment services, $5.8 million over three years to help eradicate tuberculosis, and $1.8 million over three years to develop a cannabis harm-reduction program and train health care providers in communities.

Family Services receives $22.7 million over three years to address an average 32 per cent shortfall for recipients. That won’t quite cover the need, but over three years the department hopes to increase contributions by an average of 23 per cent.

“It’s been an ongoing issue, it’s not enough money,” said assistant deputy minister for Family Services Sol Vardy.

The increases, calculated by food basket in each community and scheduled to come into effect in July, are for the food allowance. Singles will also see more support.

Family Services will also see $1.1 million over three years to improve its foster care program and $2.6 million over three years to expand the public guardianship program.

Community and Government Services will see $13.5 million over three years to increase information technology infrastructure in communities to prepare for higher bandwidth availability.

Funds will be directed to the RCMP for the creation of a special victims unit in the territory and to add new Inuktut-speaking civilian employees in six communities.

Education receives $12 million over the next three years for 40.5 positions in schools, which the department itself has been funding internally. An additional $1.4 million will go towards staffing Iglulik’s new school.

A new fund of $3.3 million will assist exploration companies to engage with communities, replacing the fuel tax rebate.

Akeeagok, noting the need for increased revenues, said the government knows it needs to increase revenues.

“We’re asking ourselves two things: Where can we cut and where can we increase revenues? We need to figure out how to do this,” he said.