Budget acknowledges the North: Todd
Feds to balance three consecutive budgets

Fact File
Balanced books in current fiscal year, as well as 1998-99 and 1999-2000.
Commitment to keep inflation will be kept between one and three per cent for three years.
Axe the three per cent surtax on income for the Canadians earning under $50,000.
Employment insurance premium holiday for companies hiring people ages 18-24.
$7 billion in tax relief for low and middle income Canadians.
$850 million in new child tax benefits over the next two years.
Self-employed Canadians can deduct health and dental premiums from business income.
Privately-managed $2.5-billion millennium scholarship fund for education.
No commitment to lowering unemployment or job creation.

by Doug Ashbury
Northern News Services

NNSL (Feb 27/98) - Ottawa is taking note of the changing Northern economy. And that's good news for Northerners, says GNWT Finance Minister John Todd.

Overall, Todd said he is generally pleased with Finance Minister Paul Martin's fifth federal budget.

Martin, in the budget released Tuesday, acknowledges the North is pursuing economic diversification through "traditional economic activities, knowledge-based industries and a new diamond industry."

Martin also said the federal government is committed to working with the North on economic development and its attempts to diversify its economy.

It may only be a few paragraphs, way back on page 61, but Todd said it's significant. He said it means the federal government recognizes the North's economy is changing.

"It's important that we work in partnership" with the federal government, he said.

As for tax relief, Todd said it was nice to see some movement.

Some tax relief will come from eliminating the three per cent surtax on income tax introduced in 1986. Canadians earning under $50,000 will see the surtax disappear.

In all, there's $7 billion in tax relief.

"This budget has tax relief those most in need, low- and middle-income Canadians," said Ethel Blondin-Andrew, MP for the Western Arctic and a secretary of state in the Chretien government.

The budget will also benefit Northern youth through Youth Services Canada by expanding funding to the program, she said.

Federal funding for education is another benefit Northerners will be able to take advantage she added.

New funding may help the North address its lack of skilled workers, she said.

For the first time in about three decades, the federal government balanced the budget.

In fact, said Martin, it not been for several spending initiatives in the past year, there would have been a fiscal 1996/97 surplus.

To pay down the almost $600-billion debt, Martin has set up a contingency fund of only $3 billion in each of the next two fiscal years.

But a year from now, Martin may announce a $5-billion surplus. Two years on it could be as much as $10 billion, according to economist Jeff Rubin of CIBC Wood Gundy.