SOMBA K'E/YELLOWKNIFE - A report released by a public policy think tank says the best bang for the territorial buck in the next budget will come from putting money into the repair and maintenance sector, along with arts, entertainment, recreation, and educational services.

"The government (needs to) increase spending to create new jobs," said Diana Gibson, co-author of the report titled "An opportunity for today and the future," which specifies what the GNWT should do with the 2010-2011 budget to balance the revenues and expenses for social, environmental and economic sustainability while at the same time dealing with the issues of recession and job loss.

"This is what governments around the world are doing right now as jobs are being lost in the private sector.

"In this time of job loss and recession, if the government is increasing spending it's important to focus on areas where the maximum number of job returns will be guaranteed."

Gibson, research director for the Parkland Institute - a research network affiliated with the University of Alberta, said short-term infrastructure spending is good, but doesn't provide to long-term economic stability.

Gibson said the government must put more money into the hands of low and middle-income citizens to stimulate local economic activity and create jobs, and added government spending to create more jobs is necessary to bring stability to local economies.

The report also recommends the GNWT reverse all spending and job cuts over the last two years - a total of $135 million and 233 jobs.

"In the midst of a global recession with private sector jobs lost ... it is not the time for governments to be cutting," the report says.

The report also recommends shifting emphasis from income tax to other taxes such as those on large corporations, resource income and payroll.

"We've talked about shifting some taxes off of income taxes and onto payroll taxes, and that would help us reduce revenue leakage," said David Thompson, a research associate with the institute. "There are people who are 'fly in and fly out' from the territories, who end up collecting money here and paying taxes elsewhere."

"Putting more money into the economy for middle and low-income citizens does increase their spending in the economy locally," Gibson said. "They will tend to spend more money on local services and will save less of their revenues."

The biggest possible benefits to Yellowknife in the report, according to Suzette Montreuil, a director with Alternatives North, are recommendations to expand energy efficiency incentive programs and a public, universally available early childhood education program.

"I'm sure there are small businesses out there who would like to do retrofits to their buildings," she said.

Gibson said a retrofit program would have immediate impacts on the territorial and local economies.

"By focusing on energy efficiency ... (it) would create jobs in the construction sector, immediately," she said. "It can be job intensive and at the same time it reduces costs for low and middle income citizens who have high heating bills."

Montreuil added an early childhood program, while optional for parents, would do a lot to improve the quality of life in the city.

"That would be a huge benefit to Yellowknife residents."