Territory’s transfer payments to be renegotiated: Fentie

Premier Dennis Fentie has struck a deal with Finance Minister Jim Flaherty to renegotiate how much money Ottawa transfers to Yukon coffers.

Premier Dennis Fentie has struck a deal with Finance Minister Jim Flaherty to renegotiate how much money Ottawa transfers to Yukon coffers.

Fentie, just back from a finance ministers’ conference in Vancouver, agreed with Flaherty and provincial premiers on the need to allow the Yukon, the Northwest Territories and Nunavut to strike a more reasonable payment scheme over transfer payments.

The deal would take place outside the federal negotiations over transfer payments with the provinces.

“We are going to be able to conclude a fiscal arrangement with Canada, hopefully, outside of the equalization process,” Fentie told a news conference Monday morning.

 “There’s a much better opportunity for us to deal with the territorial funding formula and conclude (it),” he said.

Flaherty has expressed doubt that a deal between Ottawa and the provinces is reachable in the near future.

The side deal the territories wangled could ensure the Yukon doesn’t have to wait on that process, said Fentie.

The new funding scheme the Yukon and Ottawa are working out is a “needs-based” approach that could see increased federal dollars and more financial incentives for the Yukon’s private sector, said Fentie.

“It’s going to be representative of what our needs are and the gap that is created by our ability to raise revenue, and those needs in terms of delivering comparable programs and services to Yukon citizens,” he said.

The deal should be finalized soon, said Fentie, though he could not give timelines.

A similar funding system existed in the 1980s, but was scrapped in 1995 during widespread cuts by Jean Chretien’s Liberal government.

In response to widening service gaps between the territories and the provinces, Fentie and his northern colleagues walked out on Chretien in 2003.

That snub forced Ottawa to transfer more money to the territories for health care, and helped them win a base-funding agreement that increases by 3.5 per cent every year.

But while the Yukon’s bank accounts have never looked fatter, Fentie is hoping for a better deal.

“The new federal government wants to move away from that, as we do, because it does not make sense in terms of a fiscal relationship that will address the needs of the North, in relation to those comparable standards of service that all Canadians should be receiving,” he said.

To illustrate how important it is for the Yukon to reach a funding deal with Ottawa, Fentie noted about 70 per cent of the territory’s revenues comes from the feds; most provinces see only about 20 per cent of their budgets from Ottawa.

In 2006, the Yukon had about $740 million in total revenues, of which a whopping $620 million came from federal transfers.

In addition to the funding talk, the finance ministers agreed to improved deals between Ottawa and the provinces and territories that could see more money from natural resources stay where they’re extracted, said Fentie.

A “working income-tax benefit” intended to help people move off social assistance was also formalized, and a disability savings plan of tax breaks for parents with disabled children was announced.

During his face-to-face meeting with Flaherty during the two-day conference, Fentie raised the Yukon’s opposition to recent federal cuts that have hurt literacy and women’s programs, as well as cuts to the popular GST-rebate program for foreign tourists.

The Council of the Federation, chaired by Newfoundland Premier Danny Williams, will continue to discuss provincial and territorial issues directly with Prime Minster Stephen Harper, said Fentie.

Fentie is sitting tight before planning any new spending that could become possible with increased money from Ottawa, he said.

“What we won’t do is book anything in terms of revenue until we are fully assured that revenue will be forthcoming,” he said, noting the Yukon’s budget for 2007-2008 is currently under construction

“During that time, we will be working with the federal government to see where the funding formula negotiations go,” he said.

“If all goes well, there could be a booking that reflects the new relationship with Canada.

“We’re focused on the social side of the ledger,” he said.

Just Posted

Musician aims to help others with release of Yukon Lullaby for Mental Health

Community rallies to release Nicole Edwards’ latest work

Twenty-two people vie to buy two Arkell properties

The lucky winners two now have until May 5 to purchase lots

Conservative Northern Affairs shadow minister visits Whitehorse

Bob Zimmer was in the Yukon to speak to local business groups about the economy and challenges

YESAB extends public comment period for Kudz Ze Kayah mine project

The extension pushes the public comment period far beyond the 60 days provided in YESAB’s own rules

Police shouldn’t use ‘excessive force,’ Bagnell says regarding national resistance to B.C. pipeline

Yukoners have been pressing Bagnell to clarify his position on RCMP action in Wet’suwet’en territory

Yukonomist: Three questions on Yukon Zinc and China

The case heard recently in Yukon Supreme Court is particularly troubling

Commentary: Highway plans will negatively impact safety

The proposed Alaska Highway work will impact our safety, our communities and our environment.

Olivia Webster is the final musher to finish the Yukon Quest

‘I guess I’ve always been a grandpa’s girl and he’s my best friend, so I kind of wanted to be like him and so I did it’

Yukon’s Rob Cooke and company finish 10th in the 2020 Yukon Quest

Cooke and his 14 Siberians crossed the finish line at 9:07 a.m. on Feb. 15 in Whitehorse

Mailbox: Rendezvous and protests

Letters to the editor from Feb. 14

Lights Out Yukon Invitational Basketball Tournament bigger than ever in sixth year

“Honestly, it was the smoothest tournament I think we’ve run yet”

More Yukon Quest mushers reach finish in Whitehorse

Swedish musher Nora Sjalin is this year’s Rookie of the Year Award winner

History Hunter: Will Rogers and Wiley Post: Their historic visit to the Yukon

The story of the American pilot and the film star has a Yukon connection

Most Read