Premier and minister of finance Sandy Silver presented a $1.97 billion budget on March 3, with record capital expenditures and a $39.5 million projected surplus.
The budget includes $547 million in capital spending, which is a 26 per cent increase over last year, and $1.42 billion in operations and maintenance. The budget does not include any tax increases.
Silver defended the major spending by noting that the Liberal government has a five-year capital spending plan. He said the Yukon needs “to invest heavily” in order to keep up with the growing population.
“When is enough, enough? We’re maintaining a surplus and we’ve exponentially increased the amount of capital dollars getting out the door,” said Silver. “We’re making sure that we’re balancing our budget. We’re keeping a constant look on net debt compared to revenues.”
Net debt is sitting at $207 million in this budget, and projected to rise over the next five years. This is attributed to aggressive infrastructure spending.
The report accompanying the budget notes that Yukon’s real GDP growth is forecasted at 9.6 per cent. The unemployment rate is also the lowest in Canada at 3.3 per cent.
Transfers from Canada, which make up the bulk of the territory’s revenue stream, are up 5.2 per cent compared to last year’s estimate.
Silver acknowledged that the provinces and territories can’t necessarily rely on that amount continuing to increase year over year over the next decade.
“We’ve had the finance minister of Canada tell us, ‘You know, we spent a lot of money in COVID. And we’re warning that some things are going to have to slow down. We are cognizant that the federal government is signaling, maybe a new a new approach in how they’re going to budget,” said Silver.
“But the [transfer payment] is a very steady line of financing. So if you’re going to see a trend, you’d see it year by year before. Suffice to say it does really bring to bear the importance of own-source revenue,” he said.
The report’s financial outlook notes that mining production is up and mineral prices are elevated two years after the onset of the pandemic. While tourism continues to lag due to the COVID-19 pandemic, the government is optimistic that a busy summer season is coming.
The Liberal’s budget address focused on the five big areas of spending: housing, education, healthcare, green energy and infrastructure.
Each of the rural communities will also be getting infrastructure upgrades in addition to arts spending and a new facility for gymnastics and climbing.
Spending on housing includes $26 million for lot development, $11 million for residential construction incentives and new housing developments in Old Crow, Watson Lake and Carcross.
As usual, healthcare funding takes up the largest share of the budget. The government is also planning to implement some costly recommendations from the Putting People First report, including universal dental.
Included within health and social are new line items meant to combat the drug overdose crisis. In total, $79.6 million is designated for “social supports, mental wellness supports and substance use programs” that include funding for safe supply, a mental health walk-in clinic and the supervised consumption site.
Teachers and early childhood educators will be getting a raise this year, and a new school is being structured in Whistle Bend and planned in Burwash Landing.
Implementing the Our Clean Future plan will also cost money. Among already announced plans to expand electric vehicle charging, the budget also includes $32.6 million for green infrastructure and retrofits and $2.5 million for renewable energy projects.
Around $866,000 is being set aside for flood mapping and preparation after a disastrous 2021 summer in southern Yukon.
Major infrastructure spending includes continued funding for the Dempster Fibre project, $71.6 million for road repairs, $10.8 million for the Resource Gateway projects and $51.3 million for aviation upgrades.
Both the NDP and Yukon Party opposition leaders described Premier Silver’s address to the house as lacking passion.
“The budget itself, I think, is pretty short on any sort of new vision or innovation. There’s nothing that is in any way trying to get a new direction. It is very much a status quo budget,” said Currie Dixon.
Under the CASA agreement, the NDP is obligated to vote in support of the budget. In exchange for support, it includes funding for several agreed-on policies, including universal dental and a safe consumption site.
Still, leader Kate White said she was looking for more.
“We’re coming out of COVID. Here’s an opportunity to reinvent what we thought was normal. Here’s an opportunity to lay out a grand ambition of things that we’re going to do. And that’s not what it was,” she said. “it was lackluster. A lot of money flying around, though.”
White said it wasn’t convinced that spending in the budget will go far enough to solve the housing shortage, overdose crisis or lack of family doctors for Yukoners.
Dixon said the economic indicators being touted by the Liberals — a good GDP forecast and relatively low unemployment — weren’t reflected in conversations he has had with small businesses.
“Most small business owners have not seen growth and opportunity,” he said. “This government obviously seems out of touch with that.”
Contact Haley Ritchie at firstname.lastname@example.org