Federal budget: slight raise to northern residents deduction, $8 million harbour for Pang

Canada's new government is replacing Canada's old icebreaker, the Louis St. Laurent, Jim Flaherty, the federal finance minster, announced in his budget speech this week.

Ottawa will put aside $720 million this year to commission the icebreaker, which the government says will have better ice breaking capability than the Louis St. Laurent, considered the workhorse of the Coast Guard.

The Louis St. Laurent is pushing 40 years old and won't be much good past age 50 said George Da Pont, commissioner of the Canadian Coast Guard. It's due to be replaced by 2017.

"We feel it is a very capable vessel and it can do the job but, at the same time, it is now 40 years old and it is getting time to think about a replacement," Da Pont told the Senate's standing committee on fisheries and oceans earlier this month.

The Louis St. Laurent spent much of the summer mapping the Arctic seabed. That's becoming increasingly important as Canada and other circumpolar nations compete to establish claims to Arctic territory, home to potentially billions of dollars worth of oil, gas and minerals.

This year's budget also includes $20 million for more mapping of that claim over the next two years.

And Flaherty anounced that Ottawa will raise the value of the northern residents tax deduction by about 10 per cent, much less than northern lobby groups had been demanding.

The benefit is now worth $16.50 a day, up from $15 a day. That works out to $6022.50 a year, up from $5475 a year.

As well, Pangnirtung will get an $8 million harbour.