While it had been expecting a surplus, the Yukon government actually ran a $2.6 million deficit in the 2019-2020 fiscal year.
That’s according to the public accounts, which were tabled by Premier Sandy Silver, who’s also the finance minister, on Oct. 29.
The accounts have been approved by the auditor general of Canada.
That deficit figure is in the context of an approximately $1.5-billion spending and revenue base and is consolidated, meaning it includes the financial results for self-sustaining institutions like Yukon University, the Yukon Hospital Corporation, Yukon Housing Corporation, Yukon Development Corporation or Yukon Liquor Corporation.
Unconsolidated, the government ran a $2.9 million deficit, which is less than the budgeted deficit of $5.9 million and is attributed to both higher-than-estimated revenue and expenses as well as recovery of prior years’ expenses.
On the consolidated side, though, the territorial government in its 2019-2020 budget had projected a $3.8 million surplus. However, according to a financial statement and analysis document, that surplus turned into a deficit due to a combination of lower-than-expected revenues and higher-than-anticipated expenses.
“Revenues were lower than budgeted largely due to lower than expected funding and service level agreements with other parties and lower than expected income from investment in government business enterprises,” the document says.
“Expenses were higher than budgeted largely due to higher than expected expenses in the community and transportation function and the health and social services function. Some areas of government incurred unanticipated end-of-year expenses to support the government’s initial COVID-19 emergency response.”
The government made $1.8 million, or 0.1 per cent, less in revenue than expected, while incurring $4.6 million, or 0.3 per cent, more in expenses.
Total revenue from year-to-year increased by $75.8 million to $1.476 billion while total expenses increased by $81.5 million to $1.479 billion.
As usual, the lion’s share of the Yukon’s revenue — 83 per cent — came from the federal government. Taxes and general revenue, meanwhile, made up 13 per cent of revenue, with that category growing by $8.1 million compared to last year. That’s largely attributed to a $3.3 million increase in revenue from income tax as well as a $3.8 million increase in land sales.
When it came to the increase in expenses, more than half the amount, or $43.2 million, was attributed to “health and social services function,” followed by $21.6 million for community and transportation. In total, wages and benefits made up 44 per cent of the territory’s expenses, followed by goods and services (32 per cent), transfer payments (19 per cent) and amortization expenses (five percent).
Overall, the territory is in the green, with a reported $171.9 million in net financial assets reported as of March 31. The Yukon’s net financial assets at the end of the fiscal year have been decreasing since 2015, something that the financial statement and analysis says is “largely related to increased acquisition of capital assets tied to the Government’s continued investment in infrastructure.”
According to the document, the Yukon government invested $118 million into things like buildings and transportation infrastructure in 2019-2020, a $10-million increase from the year prior.
When it comes to credit ratings, the Yukon was awarded an AA by Standard and Poor’s, tying with Saskatchewan for the second-highest credit rating in the country (the highest rating, AAA, went to British Columbia). According to Standard and Poor’s website, an AA rating means the Yukon’s “capacity to meet its financial commitments” is “very strong.”
Contact Jackie Hong at
jackie.hong@yukon-news.com
