Richard Gleeson
Northern News Services

Yellowknife (Mar 24/00) - It will be business as usual for the government from now until the summer.

If no changes are made after that, the government's financial situation will turn from desperate to dire.

The mini-budget, known as an interim appropriation, outlines spending to the end of July. The government must approve the budget before March 31, when the 1999-2000 budget ends.

Finance Minister Joe Handley said it will be business as usual for the first four months.

"This is not a time to be introducing new initiatives," said Handley, noting the government has yet to firm up its priorities it will be pursuing for the remainder of its term.

The four-month budget calls for $285.6 million in operations and maintenance and $50.8 million in capital spending.

Though it covers only a third of the year, the total of $336.4 million is 48 per cent of what the government spent on operations and maintenance and capital budget for the 1999-2000 fiscal year.

Handley said that is because the appropriation includes contractual and capital (building project) commitments for the entire year.

Frame Lake MLA Charles Dent, who served as finance minister in the last government, said those year-long commitments indicate to him the government is counting on increasing revenues to escape its current financial crunch.

"After you do an interim budget for four months, so much money is committed, there isn't a lot of wiggle room left," Dent said.

The mini-budget calls for no lay-offs or cutbacks, Handley said. Though it runs to the end of July, the government is hoping to have the budget for the rest of the year completed for the start of July. The interim appropriation, as the mini-budget is known, will end at whatever point the 2000-01 budget comes into effect.

The status quo is becoming less viable by the month. Handley said if spending continued unchanged for the remainder of the fiscal year, which runs from April 1 to March 31, the government would spend $40 million more than it takes in.

That would bring the government dangerously close to the $300-million debt limit imposed on it by the federal government.

"If we kept on spending this way and nothing changed we would be within $20 million of that wall by the end of the fiscal year," said Handley.

The Weledeh MLA said the territorial government discussed increasing the debt limit with the federal government.

"It's not our first preference," Handley said. "Our first preference would be to raise more revenues and reduce expenditures."

The main hope for financial well-being rests with seizing control of resource revenues. Because a resource revenue sharing agreement is years away, the territorial officials have been discussing with their federal counterparts the idea of getting an advance on future royalties.

Yellowknife Range Lake MLA Sandy Lee underlined the resource revenue solution. "The three diamond mines outside of Yellowknife contemplate something like $20 billion in revenue in the next 15 years. That's more than 20 times our budget.

"In any other jurisdiction you would have the option of using that money you get from industrial projects to train people, build roads."

Lee said she believes the North is looking at a very bright future -- "It's just that we have to get over this short- term hunt."

Handley said no new revenues are anticipated before the end of July.