N.W.T. finance minister tables $2.5B budget aimed at stability amid uncertainty

The N.W.T.'s finance minister is proposing a $2.5-billion operating budget for the upcoming year, which she said contains "nothing dramatic" and is aimed at being prepared for challenges that may arise during a time of uncertainty. 

"Assuming that there will be something unpredictable happening is probably the most stable prediction I can make," Caroline Wawzonek told reporters Thursday morning. She tabled the budget in the Legislative Assembly a few hours later. 

The territory expects to bring in $2.7 billion in revenues in 2025-26, which it says is up two per cent from last year. Expenses come to $2.5 billion — up from last year's $2.2-billion plan — leaving an expected operating surplus of approximately $170 million. That surplus will help pay for the territory's capital projects in the coming year.

Wawzonek said nearly a third of the budget is spent on the healthcare system, and $64 million will be spent on improving access to it for things like front-line health support, administration capacity and delivery improvements. 

Housing and homelessness is another area of spending she highlighted. The territory is set to spend $3.7 million on a strategy for homelessness in Yellowknife, $2.9 million for a public housing program and $809,000 for the Transitional Housing Addictions Recovery Program. 

Wawzonek said the territory is also trying to reduce regulatory burdens in the mining sector. 

A snapshot of the economy

In a presentation to reporters on Thursday morning, Bill MacKay, the finance department's deputy minister, said the territory's GDP is at its lowest point in a decade. 

Most of that, he said, is driven by the mining sector — but he cautioned that mining doesn't drive employment in the territory and therefore isn't the best metric of the N.W.T. economy. 

The N.W.T's three diamond mines are expected to end production in 2030. 

Rough diamonds are mainly exported to Belgium and Botswana, he said. The territory exports a very small amount of goods to the United States which, in 2023, amounted to $6,000 and included things like fur products and traditional crafts. 

Even so, MacKay said the territory would not be immune to the economic impacts of a tariff war with the United States. Anything bad for the Canadian economy, he said, would be "detrimental" to the N.W.T.

MacKay also said some smaller industries are growing, such as motion picture, sound recording and tourism, as well as traditional economies like trapping and commercial fishing.

Wawzonek said Hay River is at the "front line" of the fishing rebound, but Fort Resolution is involved as well, while the Beaufort Delta is starting to see its tourism industry "starting to flourish." 

Midwifery expansion cut

Things that are expected to be cut in the upcoming fiscal is a planned expansion of the midwifery program in Yellowknife that was expected to cost $418,000. The Department of Environment and Climate Change's operations and maintenance budget is also being reduced by $425,000. 

The territory said it was also still expecting to save $2.7 million by closing the men's unit of the Fort Smith jail — something that came to light ahead of last year's budget, but was then delayed. 

The N.W.T. government has a goal of freeing up $150 million annually, by generating more revenue and finding places to cut spending. However, it fell short of that goal this year, ultimately freeing up about $106 million.

It also wants to pay down its short-term debt by $150 million by the end of March 2028, but for this latest budget at least, the territory's short-term debt continues to climb.

Wawzonek said the government would still like to hit its goals, but doesn't want to create instability in the public service sector or in its service to communities to make it happen. 

She also emphasized that the territory had hit a separate financial goal: to pay for its capital plan using an operating surplus. "It's pretty rare that we would pay for our capital plan … without taking on debt," she said. 

The territory said it is also still waiting to hear back from the federal government about increasing the N.W.T.'s federal borrowing limit.