Financial warning buried in throne speech

Buried within a long list of feel-good pronouncements, the Government of Nunavut’s throne speech this past Tuesday contained an urgent financial warning:

“[B]udget restraints are one of the most urgent issues facing the GN today. The fiscal situation facing the territory is serious and cannot be ignored,” the speech says.

But at the same time, the government will ask MLAs to vote more spending into the 2005-06 budget, through three supplementary appropriation bills, the speech said.

“Supplementary appropriations” are special acts of the legislature used to authorize the spending of extra money over and above what’s approved in the annual spring budget sessions.

The day after the throne speech, Finance Minister David Simailak said the GN is now forecasting a deficit of $8.7 million for the current fiscal year.

Simailak also said, in a budget update, that rising world fuel prices have pushed spending up by 21.9 million, but incoming revenues from Ottawa have risen by only 9.6 million.

In the 2005-06 budget passed last March, the GN forecast a modest surplus of $3.6 million for this year.

The supplementary appropriation money will used for extra staff housing in Iqaluit, the Nunavut Home Repair Program, a new “devolution division” within the Executive department, law enforcement, court services, and the legal services board.

MLAs have already passed one supplementary spending bill this year, an appropriation of $8.4 million last May. Most of that is to pay the GN’s increased electrical power bills.

In this sitting, MLAs will also be asked to approve a $103.5 million capital budget for 2006-07.

Commissioner Ann Hanson read the throne speech on Nov. 15, at the opening of the third session of the second legislative assembly.

The speech also says the GN is proposing to spend $10 million on a “cultural school” and $10 million on a trades training centre, but only $1.5 million of that is proposed to be spent in 2006-07.