Thank you, Madam Speaker. The Minister of Finance does indeed present a rosy picture in his budget address, but unfortunately, it does not reflect the realities we are dealing with in this House. I would like to review some of his budget address comments here.
He noted that we are taking on considerable new responsibilities in about six weeks now, a little less, but I have strong concerns that we are not prepared to take these on in the manner intended and needed, and I will be speaking to this over the course of this session to make clear some of the shortcomings and liabilities that we and our public will have to deal with.
The Minister claims we are restoring fiscal balance, but I would say this is hardly the case. I am hard put to find any improvements in our fiscal situation. We are continuing to take on large, extensive projects with aggressive schedules of completion and little demonstrated evidence of return on investment while allowing our current infrastructure to deteriorate. Both of these factors obviously have significant costs, some overt and clear, others lurking unseen but building to the point that they will become obvious and problematic.
The Minister’s commitment of 5 percent of the net fiscal budget benefit to the Heritage Fund in this budget has now been dropped for this year to $250,000, or one-quarter of a percent, slightly less of our net fiscal benefit, an indication of how tight the Minister is obviously feeling. Even his misconstrued comments on the future contributions of 25 percent of net fiscal benefit to the Heritage Fund we now know is actually less than 20 percent and, again, reflect the hard fiscal reality that this Minister is facing, at least behind the scenes, and that our public is about to find out about.
The Minister continues to obstinately push expenditures that meet Cabinet agenda that undermines our fiscal health while ignoring, as my colleagues have said, too many of the priorities and concerns raised in the House. He is indeed correct that economic recovery from the recession has been slow, and yet we continue to spend like drunken sailors. What are the underlying
assumptions that he is using and where is the evidence to provide confidence in that? Again, I think a theme we’ve already heard here today, and I do want to acknowledge in cases where we are throwing out those old assumptions and proceeding in new ways, we are in fact making improvements and building benefits for our people.
The Minister acknowledges that our population is declining though he doesn’t acknowledge that this is in spite of significant effort and expenditures to reverse the trend. He says having a target of 2,000 more people in five years will make it happen. We know that our cost of living is increasing, painfully so in many areas. We know that our collection of personal and corporate income tax is declining and that we are not contemplating any new revenues. The Minister is proposing to achieve his goals by controlling our expenditure growth. How will the Minister achieve all this magic?
The solution he proposes is promoting economic development by spending almost a billion dollars on electrical transmission grids, by providing new jobs, conveniently ignoring that the greater proportion of new jobs accrue to non-residents who cannot afford to live here or who choose to move south, once they get a job, and commute. In essence, as we’ve heard, by doing the same old thing, harder, subsidized, act like a large, populated jurisdiction even if we are a vast, dispersed, low-density population with very high cost of living and energy, and with people tied to the land more than the underground, and a population with a different set of skills than required for the Minister’s approach. I submit that this approach is outdated and the substantial evidence has accrued to indicate it no longer serves the needs of our people or our land. We do indeed need some non-renewable resource development, and we have it, and we are assured it will continue. But to invest in continually growing this segment when we know that benefits to our residents decline with these investments is highly questionable.
We want our residents to be happy here and we want to attract residents who will be happy here. One of the most fundamental relationships we now understand, but that this government seems to ignore, is that associated with income disparity. Wilkinson and colleagues have proven that the happiest people are those living in societies with the most equitability, regardless of whether it’s a rich society or not. We are the most disparate jurisdiction in Canada. We have the 20 percent richest and the 20 percent poorest people in this nation. This provides an evidentiary basis rather than a hopeful basis for addressing the real issues of population, development and governments that also indicates the directions on how to go about it. How would we go about it?
We would strengthen and streamline supports, educate with this relationship in mind that we now know and understand and has been proven, strive to improve within our means while meeting the priorities of an equitable, diverse and inclusive society rather than a futile pursuit of mega-projects that do not benefit our people or our land, developed at a localized and regional scale with distributed benefits in mind. Again, benefits such as locally appropriate skill development, financial benefits, locally sourced and job intensive renewable energy that contributes to the local economies and helps restore the land are clearly answering these needs. Energy efficiency work alone could provide both the jobs we’re looking for and address the cost of living issue in many of our communities.
Such an approach returns government investment through our tax structures, small business development, lowered social and environmental costs and strengthened social structures, much better job infusions per million dollars of investment, and improved resilience of our people, and these are demonstrated around the world.
Again, while claiming with one breath that we are on a fiscally sustainable path, the Minister calls for a 150 percent increase in our debt limit to $1.8 billion. The Minister here is hoping. There is little to no evidence on which to base these hopes that many of these investments beyond our means will provide great economic return and people will swarm to live in the NWT, and in fact, our residents will stop leaving the NWT. In any other forum this would be called gambling, and we know that governments like ours have a notorious reputation at gambling success. Do you want your investment dollars spent this way?
The Minister once again dreamily refers to the Aa1 credit rating the GNWT maintains. Well, this is great, and we should aim for nothing less and celebrate it. My colleague Mr. Dolynny has highlighted the fact that many banks had the same rating the day before the crash of the housing market in the U.S. when many of them became immediately bankrupt.
Despite the Minister’s painting of such a rosy fiscal picture, things ain’t what they seem. As imminent adjustments to both this budget and next year’s budget projections will reveal, we are actually on a search for places where we can cut, and I suspect we will be considering the need to cut back our infrastructure budgets, too, as we strive to meet the realities we know exist because of the spending practices to date.
There is one hope that the Minister clings to, to bail him out, and that’s the extra $1 billion he hopes to add to our debt limit. With that, we could dive deeply into debt to correct our situation and
continue to spend like drunken sailors and, oh, wouldn’t the Harper government like that.
Because Cabinet will interpret this debt that we need to commit ourselves more and more to develop our resources at any cost, an easy transition from the current trend and huge subsidies this government lavishes on industry with desperate hopes for some wee return.
No new revenues, declining rates of increase from federal transfers, added responsibilities and liabilities from devolution with lagging development of the structures needed for management of these concerns, declining population and small community residents leaving their homes for regional centres or the Big Apple, all add up to serious concerns.
Finally, while the Premier was in a rush for devolution, the cost of expediting this by a year ahead of the federal schedule is steep and climbing. We are in for interesting times, Madam Speaker. The world is changing and, yes, we do indeed need to do things differently. We have such an opportunity. To miss it would be shameful and a poor treatment of our people, our land and their future. Let’s get real. Let’s do better. Mahsi.
