The legislative assembly resumed sitting on Wednesday afternoon, for the first time since residents of Yellowknife and much of the South Slave regions were allowed to return home.
Premier Caroline Cochrane was first to deliver remarks, pointing out what the 19th assembly has accomplished over its time. But when it came to the fiscal outlook, it wasn’t a very rosy one.
In her minister’s statement to the house, Cochrane indicated that the GNWT would most likely be running a deficit in the 2023-24 fiscal year.
And it’s the wildfires that are to blame.
“The 2023-2024 budget has been challenged by the dramatically increased costs of this year’s wildfire season,” she said.
Cochrane confirmed the reduced surplus that was talked about by Finance Minister Caroline Wawzonek earlier this month, from a projected $178 million down to $5 million.
The premier said that the drop was expected to affect the current fiscal year only and would not be seen in future years.
But she did say that the GNWT will likely run a deficit in the 2023-24 fiscal year when capital expenditures are considered, though she added that the fiscal outlook appears to be stable.
There was no indication how much the deficit will be.
She added that the federal government will be providing disaster relief funding under the Disaster Financial Relief Arrangement.
“In the coming years, the GNWT may recoup up to 90 per cent of evacuation and rebuilding costs incurred during the 2023 wildfire season,” she said. “Normally, this could take several years, but we’re negotiating with Canada to advance some of this money sooner.”
The federal government is open to that idea, according to Cochrane.
She said the territory’s fiscal stability is due to what she called “right-sizing” the capital budget in this fiscal year to reflect the capacity to complete infrastructure projects.
She said that would improve the cash balance on hand for the GNWT and the overall debt outlook, as well as not reaching the federally-mandated debt limit of $1.8 billion.