Nunavut finance minister tables $2.5B budget with focus on housing

Nunavut Finance Minister Lorne Kusugak tabled a $2.5 billion draft operations and maintenance budget for the 2022-23 fiscal year with increased spending on public and staff housing units. 

The budget is the first from Nunavut's newly elected government and reflects its priorities of the coming year. 

Nunavut Housing Corporation's capital spending is up by $3 million dollars from last year for a total of $51.5 million in this budget. Of that money, $21 million is allocated to building new public housing units, and $6 million is allocated to Government of Nunavut staff housing units. 

"Even with these investments, we know we will continue to suffer from [a] shortage of affordable, suitable, and supported housing," said Kusugak during his budget address in the Nunavut Legislative Assembly. 

The government wants to build 1,000 new housing units over the next four years. The current investment of $27 million will not be sufficient to build all the units. 

This year's budget has an estimated operational surplus of $40 million. The surplus is a result of lower COVID-19 spending and an increase in taxes at about 5 per cent. 

The 2021-22 budget had an estimated $31 million deficit.   

Kusugak said the surplus leaves room to spend more money on housing as needed. 

"Plans are already under development that could see a proposed incremental spending of more that $200 million on housing and housing programs during our mandate," said Kusugak in his address. 

Kusugak says spending the money saved would mean future deficit budgets. 

"If it means dipping into the previous year's surplus in order to begin to change the shortage of housing, I'm for that and I really hope that the Legislative Assembly is for that," said Kusugak. 

Last year, former Finance Minister George Hickes presented a $2.4 billion budget that outlined a $75-million contingency fund in place for emergency pandemic spending for COVID-19. 

During the last fiscal year the government did not need to use the full contingency fund to deal with COVID-19 outbreaks, which helped lead to the surplus. 

This year the government will also have a $75 million contingency fund that can be used for emergency spending. 

But the government says this would be used if the Nunavut Employee Union new collective agreement is ratified and retroactive pay for government employees needs to be paid back. 

Little pandemic spending 

The fund is also one of the only places for the government to pull money for COVID-19 needs. 

Last year's budget also made room for a Pandemic Response Secretariat to operate with the departments of health, community and government services, and executive and intergovernmental affairs. 

The $4.8 million allocated to the secretariat created 30 staff positions.

The 2022-23 budget will continue to fund the secretariat for at least another year. 

In April, Nunavut's public health emergency was lifted, ending government enforced restrictions on gathering sizes and mask mandates. 

The Government of Nunavut also heavily supported northern airlines through the pandemic by spending nearly $35 million last year in subsidies. 

But this year, airlines like Canadian North, Calm Air and Kenn Borek Air will not be subsidized.

The government is spending $1.6 million to hire 25 new house keeping staff to maintain new health center COVID-19 protocols. 

Elder care 

In March, Premier P.J. Akeeagok announced the Katujjiluta Mandate, which outlines the priorities for the next four years.

Aging with dignity in Nunavut is at the top of the priorities. 

The biggest chunk of this budget dedicated to elder care is $19 million to continue construction of a long term care home in Rankin Inlet, Nunavut. The total project will cost $60 million and is expected to be completed in 2024. 

"This is the start of elder care in terms of infrastructure," said Kusugak. 

The budget also has $3.7 million to add spaces at the territory's group, supported living, and alternative family care homes. This money will be put into the government's existing private sector contracts that operate these facilities. 

The government has recently come under scrutiny as Nunavummiut have staged protests and petitioned for better elder care in the territory, rather than sending elders to the South for long-term care. 

Kusugak also said in his speech the government is creating two new positions within the department of executive and intergovernmental affairs to develop an elder care strategy and to implement a plan. 

Youth and Mental Health 

During the government's leadership forum in November when Premier PJ Akeeagok was elected he promised Nunavut youth tangible solutions for youth seeking help with mental health. 

The budget has $2.5 million allocated to hire 25 new school community counselors, secretaries and custodians. 

As well as $310, 000 for a new quality improvement program through the department of family services to improve adoption and foster care programs. 

Youth will also be supported to attend the 2023 Arctic Winter Games with $1.7 million dollars in funding. 

Some money has been allocated to the Nunavut Recovery Centre at $2.1 million this fiscal year. 

The total project will cost the government of Nunavut $22.2 million. The federal government has committed $42 million to see it complete. 

But this budget has done little to increase funding in service delivery for alcohol and drug treatment programs, addictions and trauma treatment or the Nunavut suicide prevention strategy. 

However, the budget has allocated $1.5 million to support the implementation of the new mental health act. 

Most of the Government of Nunavut's revenues comes from federal transfers because the small tax base is insufficient to provide enough money for the government to provide public services. 

This year the federal government has provided nearly $2 billion in federal transfers. Up about four per cent from last year. 

Other revenues are made up from taxes and third party agreements in the form of one time payments. 

Other budget highlights include: 

• $17.2 million for fibre optic telecommunications cable to Nunavut

• $2.8 million to hire 28 new staff at the Aaqqigiarvik Correctional Healing Facility 

• $2.1 medical travel clerks to improve service to medical travel clients 

• $3 million to support homeless initiatives and family violence shelters 

• $1.4 million for more school busses across Nunavut 

• $15.1 million to upgrade the government's financial and human resource systems

Kusugak recently took over the position as Finance Minister in March, after Adam Arreak Lightstone was stripped of the portfolio. Nunavut's integrity commissioner found that Arreak Lightstone did not not give "thoughtful and timely consideration of the possible conflicts of interest associated with his spouse being employed in the department." 

Kusugak sported new $20 Costco dress shoes to the budget— it's customary for the finance minister to wear notable shoes while delivering the budget address. 

"You don't need to spend a lot of money to get a good pair of shoes," said Kusugak. "I think that goes the same way for the government of Nunavut, trying to make our dollar go as far as we can. What we save on shoes will be used towards housing, or towards food or anything else." 

Nunavut's MLAs will review the draft budget over the coming weeks. The current spring sitting of the Legislative Assembly runs until June 14.