Nunavut finance minister won’t rule out cuts, deficit

A housing unit seen under construction in Cambridge Bay Oct. 1. Finance Minister Keith Peterson ackowledged this week that finacial troubles at the Nunavut Housing Corporation could push Nunavut into a deficit this year. (PHOTO BY JANE GEORGE)

Nunavut’s finance minister said he can’t rule out a deficit or spending cuts to cover the latest $50-million shortfall at the Nunavut Housing Corp.

Keith Peterson said in an interview Oct. 4 said he’d prefer to avoid spending cuts as the Government of Nunavut grapples with the latest series of cost overruns at the beleaguered corporation.

“It’s going to be tough,” Peterson said.

Nunavut still has between $50 million and $75 million worth of room under its legislated long-term debt cap and running a deficit would eat into that amount.

But despite the territory’s difficult financial situation, MLAs — Peterson included — aren’t yet willing to start slashing government services to pay for bungling at the housing corporation.

All government departments, except health and education, had to trim their budgets by three per cent, without cutting programs, during belt-tightening in response to the initial $60-million shortfall caused by overspending on the $200-million Nunavut Housing Trust.

“I think it’s important that we maintain our programs,” Peterson said. “The departments already demonstrated that they cut as much as they could.”

Last month, new housing minister Tagak Curley told APTN the GN was determined to stay out of deficit, but acknowledged the final decision is Peterson’s.

Curley also told the network that cost overruns on housing projects were less likely to scare away the federal government from making future contributions than not finishing the housing projects at all.

Cabinet ministers have been pushing the bright side of the latest $50-million overrun of the Affordable Housing Initiative: that despite the costs, badly-needed houses are getting built.

Peterson, speaking from Cambridge Bay, said 47 people are on the waiting list there, and Nunavut still needs at least 3,000 housing units to catch up with national standards.

The two housing programs will build a total of 1,011 housing, according to government figures, albeit at a cost of $410 million instead of the projected $300 million.

“Everybody, every MLA, every minister knows that housing is number one,” he said.

“We just can’t not build houses because people need houses.”

In the meantime, the public is still awaiting the results of an audit into the $60-million mess at the Nunavut Housing Trust.

Peterson said the government is also mulling major changes at the housing corporation, anywhere from improvements to accounting procedures to a complete restructuring.

“We don’t want to jeopardize our future funding from those folks in Ottawa,” Peterson said. “We want to demonstrate that we’ve learned from this.”