Yellowknife (Feb 28/03) - With a projected deficit of $77 million, Finance Minister Joe Handley doesn't have a lot of breathing room, despite a strategy to spend our way to greener pastures.

Handley met with local social and environmental activists Wednesday in what is becoming an annual event, following close on the heels of the unveiling of the territorial budget.

His message: while the deficit is "not a huge concern," as long as Ottawa keeps eating up resource revenues, funding a growing number of social and environmental concerns will not be easy.

"We're spending more than we're bringing in this year," Handley told his audience at City Hall's lower boardroom. "It's very frustrating to have a federal government so insensitive to the North."

Nonetheless, participants prodded him - if not gently -- wondering if the GNWT is getting the best bang for its buck.

Suzette Montreuil, president of Union of Northern Workers Local 11, questioned the government's decision last year to lower personal and corporate tax rates, knowing that the numbers may affect federal formula transfer payments to the NWT.

"What kind of message does that send to the federal government?" Montreuil asked.

Handley said even though the tax break resulted in lower federal transfers, it was necessary to ensure the NWT remains an attractive place to live while also noting the high cost of living North of 60.

"It can be hard to make ends meet up here," said Handley.

Overall, however, participants said they were pleased the minister took the time to show up, and hope the meetings continue in the future on an annual basis.

"I'm happy that we have the type of assembly that is willing to sit down with us and chat, not patriarchal and 'this is the way that it is,'" said Ecology North's Rhonda Howells.

"At least there's that feeling of feedback and conversation."