SOMBA K'E/YELLOWKNIFE
Finance Minister Michael Miltenberger made it clear the territorial government is facing some tough financial times in the years ahead, which means tough decisions remain for the next legislative assembly.

Finance Michael Miltenberger shows off his new $300 hand-made moccasins ahead of the unveiling of the 2015-16 operating budget. - Cody Punter/NNSL photo

During the presentation of the $1.68 billion operating budget Thursday, Miltenberger concluded with a blunt message: "We have been spending everything that we receive."

With revenues expected to go up by just 0.4 per cent over the next five years because of the NWT's stagnant population, which is tied to government transfers, he explained the government doesn't have money to hand out to new programs.

While the budget includes plans to fund just $24 million in new programs, most of that money is coming from the reallocation of $23 million of existing funding.

This year's budget surplus is projected at $147 million. It would have been higher but the GNWT had to pay down debt incurred during last year's forest fire season and the $20 million used to bail out power consumers after the NWT Power Corporation was forced to switch to diesel due to low water levels at Snare Hydro. There was also an unexpected shortfall in corporate income tax.

"We are approaching the edge of a cliff and our challenge is to ensure that we do not go over," said Miltenberger.

No new revenue

While Miltenberger was touting the difficult times being faced by the government, several MLAs pointed out that the budget did not propose any tangible solutions for increasing its revenue.

In his member's statement Range Lake MLA Daryl Dolynny accused the government of delaying, deferring and diffusing.

"I've said many times and I'll say it again, we need to find a way to keep our own source revenues," said Frame Lake MLA Wendy Bisaro.

"There have been options proposed by regular members but they have so far been studiously ignored by cabinet. We still do not have any sources of new revenue to offset our operations and maintenance budget."

Noticeably absent from the budget address, according to Todd Parsons, president of the Union of Northern Workers, was any mention of a corporate tax increase or rent increases on mines.

"There's opportunities that are available to generate revenues in the Northwest Territories that were missed," said Parsons, suggesting the reason why the minister shied away from such a measure is because it's an election year.

"Certainly the minister doesn't want to create any kind of turmoil leading into the territorial election."

Although this year's budget represents a two per cent increase over last year's $1.6 billion budget, $43 million will be used to spend on forced growth as a result of the rising costs of delivering existing programs as well as an increase in salaries as per the government's collective bargaining agreement.

Parsons added that the upcoming collective bargaining agreements between the GNWT and the UNW, which will set the parameters for government employee's wages will only increase the pressures on the next assembly to accommodate more increases to the budget.

During a press conference held before the budget was delivered, Miltenberger maintained that the government should focus on growing its tax base by continuing with plans to attract 2,000 people to the territory instead of raising taxes.

In his budget address Miltenberger alluded to the fact that future legislative assemblies would have to balance the potential revenue that could be generated through raising taxes with the impact such a measure would have on the territory's tax base.

The decision to put off difficult spending decisions led David Wasylciw, founder of transparency advocacy webpage, Open NWT, to accuse the government of "punting along" its financial constraints to the next assembly.

"Everything just gets differed and put off," he said.

"They could definitely make some hard decisions to make the next assembly a little easier but instead the wish list for the next assembly seems to keep growing. It ties the hands of the next assembly."

While some were critical of the budget, the NWT Chamber of Commerce said it was pleased that government was putting forward a conservative budget.

"No new taxes, a fiscal surplus and more efficient and better program spending priorities. You can't really ask government to do better than that," he said.

2015/16 budget

Revenue: $1.83 billion

• Operations and maintenance budget: $1.68 billion
• Capital budget (already approved): $277 million
• Projected surplus: $147 million
• Projected borrowing as of March 31: $730 million
• $1.1 million to continue support for a wellness court
• $1.75 million to increase monthly allowance for food under the government's income assistance program
• $1.4 million will be spent on supporting energy conservation efforts throughout the territory
• $3 million for the completion of devolution implementation

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