A multi-million dollar payout from the Northwest Territories to New Brunswick is the latest in a growing number of opaque settlements involving the territory in recent years.
The money going to the Maritime province was raised during a sitting of the Legislative Assembly on March 11, when Frame Lake MLA Kevin O’Reilly asked Minister of Finance Caroline Wawzonek about a $2.75 million line item in the Department of Infrastructure’s capital investment expenditures.
Wawzonek explained that the payout went to the Government of New Brunswick, and it arose from litigation related to the construction of the Deh Cho Bridge. She said the details of the settlement were protected by a confidentiality agreement, but that the payment “does fully resolve the matter.”
Previously, the Government of New Brunswick was on the hook to the Northwest Territories for about $13.4 million after Atcon, the New Brunswick-based company that was the general contractor for the bridge, folded in 2010. It was unclear why the NWT was now paying nearly $3 million to the Government of New Brunswick.
The New Brunswick settlement is not unique: in December, the Standing Committee on Government Operations published a report on the review of the GNWT’s 2018-19 and 2019-20 public accounts. In it, the committee found that combined dollar amounts of claims against the GNWT with indeterminate outcomes have increased exponentially in the past decade — from $6 million in the 2010-‘11 to $107 million in 2019-‘20.
In other words, when the dollar amounts of all the claims filed against the territory are combined for cases where the outcome is uncertain — particularly out-of-court settlements — that amount has increased more than tenfold in the past decade.
“The committee is concerned about the significant, rapid growth in claims with indeterminable outcomes and the potential for liabilities to arise from these claims,” the report reads.
Because of the timing of the New Brunswick settlement claim, it likely isn’t included in the decade-long record of settlements featured in the government operations committee report.
Following the release of the report in December, Yellowknife North MLA Rylund Johnson, who chairs the government operations committee, called the settlements a “black box.”
When asked about the settlement with New Brunswick, he said the dispute with Atcon was before his time as an MLA, “although the fact that two public governments are signing confidentiality agreements about a now-defunct company over a bridge built 10 years ago is insane.”
In Canada, jurisdictions vary in how they report claims. In Ontario, for example, all in-progress and threatened claims against the province above $50 million are publicly reported.
The committee recommended that the territory improve public reporting of these liabilities by including in its public accounts both claim amounts broken down by category and individual claims above a certain dollar amount.
The report also recommended that the GNWT respond to the contents of the report within 120 days, which means by April 1 of this year.
The Department of Finance agreed to answer questions about the report and the settlement with New Brunswick, but was unable to respond in time for publication.
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