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Finance minister mum on potential budget cutbacks
Territory citing tough times in negotiations with union but Robert C. McLeod tight-lipped on possible cutbacks

John McFadden
Northern News Services
Friday, January 29, 2016

After months of warnings heard of tough economic times ahead, Finance Minister Robert C. McLeod is not saying whether any budget cuts are in the works.

When Yellowknifer asked him directly whether major cuts to jobs and services were in the works, McLeod was non-committal.

"We're going through a planning process right now. We will work closely with the (priorities and planning) committee then we will decide our options going forward," McLeod said. "We have to go through the whole budget planning process, lay all our options on the table and work with committee to see what we can make work."

McLeod made his comments as contract negotiations got underway in earnest in Yellowknife this week between the territorial government and the Union of Northern Workers, which represents GNWT staff.

The talks actually began earlier this month with an exchange of proposals from both sides.

Despite what most people agree are challenging economic times in the NWT, the union is still seeking improvements to its workers benefits in its collective agreement which expires on March 31. According to union contract proposals, the union is seeking more vacation time and leave time for family deaths, among other things.

On the other hand, the government is pointing to the closure of Snap Lake Mine, a decrease to the federal grant by some $33 million and that the 2014 GDP for the NWT is 7.5 per cent lower than the five-year average before the recession in 2008.

The GNWT is laying out its position and proposals and wants to ensure fair compensation for employees while delivering on its overall fiscal responsibility and commitments to the priorities of the government and NWT residents, said McLeod.

"The state of the economy and the government's finances are not where we would like them to be right now. The Snap Lake decision ... and the territorial funding formula reduction from the federal government ... puts us in a fairly difficult position fiscally and so we need to make some decisions on how we are going to deal with that," McLeod said.

He added that he had a positive meeting earlier this month with the parliamentary secretary to federal Finance Minister Bill Morneau about the proposed cuts to the federal grant, which funds GNWT services and programs.

"The federal minister of finance did say that they would have some indication by the middle of March as to the territorial formula financing and whether there might be some partial restoration. We'll just have to wait and see. We've made our case," McLeod said.

McLeod said he would have this advice for any GNWT employees who were worried about being laid off: "You just have to wait until the process plays out to see where we go from there. We have to work with committee and put our options of the table."

He refused to elaborate on what options have been discussed with the committee thus far.

McLeod said there is unlikely to be any announcements about any possible budget cuts until May when budget deliberations will begin with MLAs in the legislative assembly.

"We go through business plans with the regular members and then we put a budget together and we table that during the May/June budget session," McLeod said.

At least one MLA said he would not support government cuts despite the tough economic times. Range Lake MLA Kieron Testart said austerity measures will not end the economic doldrums.

"We have to look at our short and long-term borrowing to ensure that we can provide economic stimulus to support our industries, our Northern businesses and make sure we can invest in mineral exploration at a time when it is sorely needed so that we can prepare ourselves for the next round of commodity cycles returning to health," said Testart.

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