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Raising the borrowing limitFeds to vote on NWT MP's bill, which proposes a much higher debt wall for the GNWT
Northern News Services
Published Wednesday, February 16, 2011
Western Arctic MP Dennis Bevington's Bill C-530 would give the GNWT the authority to borrow up to 70 per cent of its estimated annual revenue. Right now the territorial government can borrow up to $575 million, and is borrowing $515 million.
The debt wall was raised by $75 million last year, which will remain for five years, mostly to accommodate the debt that came with the Deh Cho Bridge project. Going on this year's budget, Bevington's bill would allow the GNWT to borrow $951 million.
"We're a developing territory where we need to invest in all kinds of infrastructure," said Bevington. "We're trying to do something here for the NWT."
An example Bevington cited in a letter to federal Finance Minister Jim Flaherty, is that the City of Yellowknife is allowed to borrow two times its annual revenue, minus outstanding principle. As well, Bevington said the federal government is currently operating on a debt more than double its annual revenue.
The bill was debated on Thursday and Bevington said it should be in the House of Commons for a vote today.
He's heard opposition from the Conservatives, who have said the government wants to try and deal with all three territories in the same way. Bevington pointed out that NWT is being offered devolution, control over its land, water and resources, while Nunavut is not being considered for it yet, and Yukon has had it since 2003.
Bevington said the other parties have so far indicated support for the bill.
"It looks good if everyone shows up, and if none of them change their minds in the next few days it should go ahead," he said, adding there's no guarantee, however, until the vote is taken.
Bevington said he's been in contact with the GNWT about bringing this bill forward since January 2010.
Territorial Finance Minister Michael Miltenberger said the GNWT is currently in talks with the federal government to increase its borrowing limit as well, and hopes to have things settled by April.
"The Member of Parliament has come up with a private member's bill in an attempt to, in his own way, deal with the borrowing limit," said Miltenberger. "We are on our track with the federal finance department."
He called the formula Bevington proposes "interesting."
"It would be something we could live with but, once again, the federal government is looking at it as well to see if there's anything in the bill they could support, from what I understand," he said.
"Our borrowing right now is short term and we want to avoid circumstances like we just recently went through where we had to go to the federal government to get a $75 million, five-year bump up to help us deal with the bridge issue."
He said with things like devolution on the table, the government should be given more authority to borrow.
"We manage a ($1.3 billion budget), we're taking over land, water resource development, at the same time we have a borrowing limit from another time, from the previous century."