The GNWT plans to increase staffing in the Health department by 87 per cent, according to its latest budget.

The GNWT plans to add 284 new positions to its departments and public agencies in 2021-2022, up from the 5,917 active positions in 2020-2021.

Health and Social Services will go from 182 positions to 341, and Health and Social Services Authorities will rise from 1,645 to 1,755, accounting for the bulk of the new jobs.

In response to questions about the increases showing a “bloating government,” Finance Minister Caroline Wawzonek told reporters that some of the increases are due to growth in the health sector in general.

But she said that under the GNWT’s Government Renewal initiative, more attention will be focused on increasing value and efficiency in public sector positions. That initiative will require no new investment, she said.

“If we do it well and right, I hope to achieve more value-oriented services,” she said.

Budget up slightly from last year

In documents released Thursday morning, the GNWT forecasts revenues of almost $2.2 billion for 2021-2022, with total expenditures of close to $2.1 billion.

It’s expected to leave an operating surplus of about $69 million.

This year’s budget proposes $117 million of increased spending over Budget 2020, which includes $104 million for adjustments and added expenditures for GNWT departments.

HSS will see the largest increase in estimated spending, with an additional $63 million allocated. Of that, the Covid-19 Coordinating Secretariat will receive about $35 million.

GNWT overall spending had increased since 2019, when it was $1.9 billion and rose to $2.2 billion in 2020-2021. It is projected to decrease slightly for the 2021-2022 budget, to $2.124 billion.

Finance Minister Caroline Wawzonek said the population of the NWT has been relatively stable amid some ups and downs over the years. NNSL file photo

Revenues also rose since 2019, when they were at $1.85 billion, rising to $2.18 billion in 2020-2021 and estimated to be around $2.19 billion for the 2021-2022 budget.

On a negative note, once the final analysis is completed, the NWT economy is expected to contract 6.6 per cent in 2020, mainly because of the effects of the Covid-19 pandemic on consumer spending, trade, diamond production, private investment and tourism.

In 2021, however, diamond production at the restarted Ekati mine, along with exports and investment increases, are expected to boost economic growth by 5.8 per cent.

The GNWT’s own-source revenues are estimated to decrease to $322 million for 2021-2022, their lowest level since 2019, when they were at $348 million.

Most cash comes from Canada

Federal transfers still account for most revenues. They rose to $1.8 billion in 2020-2021 from $1.5 billion in 2019. They’re estimated to reach $1.87 billion in the 2021-2022 budget.

Own-resource revenue estimates reflect federal forecasts and the fact the GNWT believes the population might decrease due to a decline in personal income tax returns, combined with the effects of Covid-19.

Wawzonek said the population of the NWT has been relatively stable amid some ups and downs over the years.

“I hope the takeaway for people is that we’re finding a way to be stable even during a pandemic. In the short term we’ve introduced measures to help keep people safe and healthy,” she said.

She noted that no new taxes have been added in the budget.

Mining and resource royalties, which normally contribute to own-source royalties, were revised for 2020-2021 to be zero in the budget, reflecting weak diamond sales due to Covid-19.

“It’s much lower than what we projected it to be. Sales are showing recovery,” the finance minister said.

Small and medium-sized businesses will not be ignored in the budget and the government plans to a launch a new committee aimed at cutting red tape for small businesses in the territory, Wawzonek said.

‘Unsustainable’ fiscal plan

The budget document states that operating and capital expenditure growth are exceeding revenue growth, making the current fiscal plan “unsustainable.” It also indicates that “immediate action” is needed to ensure sufficient borrowing room remains for the next legislative assembly.

On the NWT’s current course, the federal borrowing limit of $1.8 billion would be exceeded by the next legislative assembly, leading to an operating deficit in three years, if the course isn’t adjusted.

Wawzonek explained that with the federal government expecting some form of recovery this year, if the GNWT takes a careful approach and makes strategic investments it could be in a more stable position next year.

She said the Government Renewal initiative would help find ways of spending more effectively and that more efficiencies could be found.

“I hope we can spend more money based on value and I hope to see a change in our fiscal fortunes,” she said.

Blair McBride

Blair McBride covers the Legislative Assembly, business and education. Before coming to Yellowknife he worked as a journalist in British Columbia, Thailand and Ontario. He studied journalism at Western...

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