Neils Christensen
Northern News Services

Iqaluit (May 24/04) - Homeowners will pay a little less, income support recipients will get a little less and the government has put $66 million aside in Nunavut's 2004-2005 budget.

Finance Minister Leona Aglukkaq answers media questions regarding the 2004 budget. The budget was released May 18 in the Legislative Assembly. - Neils Christensen/NNSL photo Budget by the numbers Revenues Federal transfers: $802.4 million Territory revenue: $74.1 million Total revenues: $876.5 million Operation and Maintenance budget, department by department Office of the Legislative Assembly: $12.5 million Executive and Intergovernmental Affairs: $9.3 million Finance: $52.5 million Human Resources: $18 million Justice: $48.9 million Culture Language Elders and Youth: $13.8 million Education: $165.7 million Health and Social Services: $182. 2 million Environment: $14.2 million Community and Government Services: $108.8 million Economic Development and Transportation: $37.4 million Nunavut Housing Corporation $79.2 million Total budget: $742.9 million Capital expenditures Finance: no capital projects Human Resources $73,000 thousand Justice $7.2 million Culture Language Elders and Youth $2.7 million Education: $24.7 million Health and Social Services: $28.6 million Environment: $2 million Community and Government Services: $24.1 million Economic Development and Transportation: $2.6 million Nunavut Housing Corporation: $15.9 million Total capital budget $107.9 million Total government budget $850.7 million

Minister of Finance Leona Aglukkaq announced that the government will reduce the property tax by eliminating the school levy portion of the tax.

Aglukkaq said the reason for the tax cut is to promote more home ownership in the territory.

"We wanted to give homeowners a break," she said. "I think this is good news for the people of Nunavut."

The school tax levy generates about $500,000 in revenue.

The government also plans a 10 per cent increase in the food allowance for families on income support.

Facing deficit

The budget numbers also reflect the tough financial situation in the territory.

The government is facing a deficit of $13.4 million dollars.

This year the government plans to spend $850 million -- most of it from federal transfer payments -- and that must change, Aglukkaq said.

"We must change the heavy reliance on the public sector," she said.

"We need to develop an economy that relies on the private sector to make a more significant contribution."

Most of the territory's revenue comes from federal transfer payments that total $802.4 million this year.

"The money we get from the federal government fails to recognize the major spending needed in Nunavut," Aglukkaq said. "We need major funding for critical infrastructure."

The the territory's own tax revenues amounted to $60 million, but almost $10 million came from tobacco and alcohol, and just $6.3 million from corporate taxes.

Aglukkaq said the government is trying to put more emphasis on private industries to generate revenues.

Aglukkaq also expects mineral exploration will generate another $120 million in government revenue.

What the MLAs say

According to other MLAs, this year's budget shows how much more money is needed to meet the growing demands in Nunavut.

Keith Peterson, MLA for Cambridge Bay, said there's not enough money to go around. A deficit is bad news, but they need to spend the money.

"There are just so many competing demands, where do you spend the money," he said. "We need more outside investment. We need more money coming in."

Hunter Tootoo, MLA for Iqaluit Centre, agreed that the government needs more money and fast.

He added he is encouraged the finance minister is up front about the problems in the territory.

"I give the finance minister a lot of credit. She's not afraid to use the word deficit," he said. "In the past the government has shied away from using that word."

Tagak Curley, MLA for Rankin Inlet North, said he doesn't see new progress with this first budget. "It's the same problems they are trying to deal with," Curley said.

He added he was happy to see that home owners were given a break on their property taxes with the elimination of the school tax levy.

"I agree with the minister: that is good news. I think our home owners deserve a break."

Curley said it would have been nice if the government didn't have to spend surplus revenue on the deficit.

"I think that reserve could have gone to better use," he said.

While the government will pay off the deficit this year, it still has a debt of $143 million.