Thank you. Member for Yellowknife North.
Thank you, Madam Chair. You know, I'm going to ask no further questions because I feel I'm unable to ask any questions without specifically looking at a confidential document. And I have said this many times in how we do our budgeting that often we pass budgets where we can't say what we want, where we have no idea that there's no public figure provided for the cost of projects. So I also note that the clock wasn't started when I actually spoke so I think I well used up my time. Thank you, Madam Chair.
Thank you. Member for Frame Lake.
Yes, thanks, Madam Chair. And I might have blown the whistle on my colleague beside me in terms of the time but, yes, I want to pick up where he's left off.
You know, I find it really difficult that we're trying to do a reconciliation of 2021 capital budget publicly when we've got confidential information. That's what we're trying to do here. And it's not working very well.
So I think I heard somebody say that there's a free balance of about $222 million, if I got it right, or $200 million. Basically the money that wasn't spent on the capital budget from 2021, if I got it right.
So what percentage of the capital budget wasn't spent? Is it, like, roughly 40 percent? 50 percent? 60 percent? Roughly what amount of the budget wasn't spent? Thanks, Madam Chair.
Thank you. Minister of Finance.
Thank you, Madam Chair. Madam Chair, we do have the percentage here. I am
We don't have 20222023 yet. In 20212022, at this point, Madam Chair, we're looking at about 49 percent, just over. 49.6.
Member for Frame Lake.
Yes, thanks, Madam Chair. That's a problem. We can't spend 50 percent of the capital budget that's approved by the Assembly? Look, that's why I voted against the last capital budget because I didn't believe we could actually get the money out the door. And I've been proven right. And, you know, I don't blame anybody in this room, but and there's but I've asked now for tracking of those reasons for at least five or six years. Is the department actually tracking these reasons any better? Thanks, Madam Chair.
Thank you. Minister of Finance.
Thank you, Madam Chair. Yes, they are tracking over the course of several years and, in fact, I think I've looked at the data for approximately ten years as to the percentage. And the percentage does vary, but the approximate amount that we are spending year over year doesn't change that much aside perhaps from a couple of years of COVID where things were a little bit tighter than unusual and more difficult to go out and spend. Thank you.
Thank you, Minister. Member for Frame Lake.
Thanks, Madam Chair. Without breaching confidentiality, I want to compliment the Minister and her staff for their improved tracking of the reason why money's not getting out the door. Unfortunately, I can't speak to it. I can't share it with the public. But I think it's improved, and that's a good thing. So I want to compliment them for doing that but I want to find a way to share that information publicly, because I want to give them more compliments but I can't.
So in any event, we're not doing a good job at reconciling the capital spending and how it figures into supplementary appropriations on the capital side, and that's a real problem.
So of the money that is some of it's being carried over, $64 million I guess is what this sup is for. So the remaining amount, 126, if I got it right, it's being lapsed, what happens to it? Does it just go back into the consolidated revenue fund? Are any of those projects going to come back in another sup or in the capital estimates for 20232024? What happens to that money? Thanks, Madam Chair.
Thank you, Member. Minister of Finance.
Thank you, Madam Chair. So I mean, there's different and Madam Chair, let me just address the confidentiality issue quickly if I might. I don't have a clock in front of me, but I'll try and be succinct.
Look, I do think we can do a different way of presenting this information. This wasn't raised to me in advance, and that's fine. But I do think there's ways of doing it. There's concerns around the longterm plan and concerns around sharing the budgets on the long term. Some of these projects are multiyear projects so sharing what's lapsing inevitably winds up sharing what some of the budgets are. So that said, I do think there's ways we can get this information out. So we'll take that away.
Now, as for what happens to the funds in one year, again, may depend on the nature of a project. The longterm project may already have funds approved going forward, and the project can then continue. If it's not continuing then, yes, the money would just lapse back in to being in the general coffers of the government. Or the consolidated revenue fund. Thank you, Madam Chair.
Thank you, Minister. Member for Frame Lake.
Yes, thanks, Madam Chair. So I guess I want to start to draw some conclusions here to this because I think it means at least a couple of things to me.
Number 1, we need to review the fiscal responsibility policy about how much and when we can spend money on capital and where it comes from and so on. And when we can't spend 50 percent of a capital budget, the fiscal responsibility policy itself I think needs to be reviewed. And I think we may have a commitment from the Minister to do that. But maybe I'll stop there and I'll ask the Minister whether that's something that's going to happen. Thanks, Madam Chair.
Thank you, Member. Minister of Finance.
Thank you, Madam Chair. Yes, Madam Chair, there already is a commitment out there to review the fiscal responsibility policy. Thank you.
Thank you. Member Frame Lake.
Okay, thanks, Madam Chair. And thanks to the Minister for that.
The second conclusion I draw from this is that we're spending, or attempting to spend, or budgeting too much on capital. And what means is that we have less money for programs and services because it's all too much, in my opinion, is going into capital, and then it gets carried over and over and over and over, over a series of years in some cases, maybe it never gets spent. But what it does is eats up some of the money in the operating surplus which means that we are spending less than we could, and perhaps even should, on programs and services, particularly housing, healthcare, education, people's basic human needs. That's what's resulting here, Madam Chair, in my view. I'd like to hear what the Minister has to say. Thanks, Madam Chair.
Thank you, Madam Chair. Minister of Finance.
Thank you, Madam Chair. Madam Chair, so I would say that the Member is correct insofar as by having a large capital plan, we wind up that we are not going to be able to completely spend, if you will, and it may be difficult to know in advance which project is or is not going to go ahead. So you know, there's inevitably going to be some amount that does not get spent, and that's never going to be a perfect projection.
By having the large capital, we are not necessarily impacted immediately or taking away from operations. The operations budget is still, you know, existing and being developed on its own based on those needs department by department.
However, by having a capital plan that is too large in the sense that we know we will not achieve all of it, we are creating a situation where I don't know if you can recall seeing the borrowing limit and seeing the narrowing gap in between them. If the capital budget wasn't as large, well then we wouldn't be running up as close to that projected line of hitting the borrowing limit because we would have more room. There would not be the need to project the higher level of debt because we simply wouldn't have to take on the higher level of debt because we wouldn't have as much on the capital plan. So it does impact our overall fiscal situation and the overall fiscal picture by suggesting that we're running up against the borrowing limit when in fact if we're not, if we're not going to need to borrow because we're not going to need to spend all that money in the capitol plan, well then our fiscal situation doesn't run up against the borrowing limit quite so quickly. Thank you, Madam Chair.
Thank you. Member for Frame Lake.
Thanks, Madam Chair. Yes, I want to thank the Minister for reminding me of a third point. She just made it for me, that with our overspending, or at least overbudgeting, I'll put it that way, on capital side that we are having to increase the debt limit several times even during my lowly six years here. But once again, the conclusions I draw from this are number 1, that, you know, we are getting closer that debt limit because of overspending on capital; number 2, we have to review the fiscal responsibility policy; and number 3, we're taking money away from basic human needs like education, healthcare, and housing, by spending too much on or budgeting too much on capital projects that we can't get the money out the door.
So that's the conclusions I draw, and that's what, Madam Chair, where I'm going to vote against the supplementary appropriation because it although there is some money lapsed and it's not going to come back, it still perpetuates the overspending on capital by this government ad does not meet people's basic human needs. And that's why I'll vote against this. Thanks, Madam Chair.
Thank you, Member. Are there any further general comments before we get into the detailed? Member for Thebacha.
Thank you, Madam Chair. I will be voting for this appropriation because the lack of infrastructure in communities and regional centres compared to the capital, for example, is lacking. And this appropriation addresses some of those needs that are needed in the communities and regional centres, as well as the capital. And I don't believe that when you build on capital projects within the territories that we're taking away from education and basic human needs. On the contrary, okay.
I think that each and every one of us in our capacity as leaders cannot draw that conclusion. And I don't agree with my colleague with some of those comments. Thank you, Madam Chair.
Thank you, Member. Are there any further general comments? Seeing no further general comments, we will review the supplementary estimates by department and activity. Does committee agree to proceed with detailed in the tabled documents?
Agreed.
Committee, we will begin on page 6.
Department of Education, Culture and Employment, operation expenditures, junior kindergarten to grade 12 school services, not previously authorized, $4,893,000. Does committee agree? Member for Yellowknife North.
Thank you, Madam Chair. Can I just confirm that Sissons is still on track and ready to be opened for the next school season? Thank you.
Thank you. Minister of Finance.
Yes, Madam Chair.
Thank you. Any further questions? Member for Yellowknife North, any further questions? No, okay.
Department of Education, Culture and Employment, operations expenditures, junior kindergarten to grade 12 school services, not previously authorized, $4,893,000. Does committee agree?
Agreed.
Thank you. Department of Education, Culture and Employment, operations expenditures, total department not previously authorized, $4,893,000. Does committee agree?
Agreed.
Committee, please turn to page 7 of the tabled document.
Department of Infrastructure, operations expenditures, asset management, not previously authorized, $552,000. Does committee agree? Member for Yellowknife North.
Thank you, Madam Chair. In my neverending attempt to understand accounting language, this $552,000 has an offsetting amount which was lapsed in the previous fiscal. Does that therefore make this a carryover but just essentially a carryover that doesn't cost us any money because we lapsed it last fiscal; am I at all on the right page? Thank you.
Thank you, Member. Minister of Finance.
Madam Chair, take that to the deputy secretary, please.
Thank you. Mr. Courtoreille.
Thanks, Madam Chair. This line item refers to deferred maintenance, and the Department of Infrastructure actually has a regular annual budget for deferred maintenance under the operations expenditures. It's $1.5 million. They were able to demonstrate through the Financial Administration Manual that there's commitments and contractual obligations for the 552 proposed for carryover. The remaining amounts unspent would be lapsed. Next year for the capital budget in 20232024, the department would still maintain their $1.5 million budget for deferred maintenance in this area. Thank you, ma'am.
Thank you. Member for Yellowknife North.
Thank you, Madam Chair. Okay, so I do have questions, then.
So we're carrying over about $550,000 of the $1.5 million, meaning the Department of Infrastructure lapsed about a million dollars of deferred maintenance. And I guess my understanding of this happens is because they don't have the contracts in place so they can't say we're absolutely have either a contractual commitment or significant progress under the Financial Administration Manual is why it lapses. But I guess can we get a bit of an explanation of why that happened?
Because I know that the GNWT's deferred maintenance backlog is massive. You know, there's different calculations based on needs but it's fair to say it's in the hundreds of millions of dollars. So how on earth are we not spending a million of it? Thank you.
Thank you. Minister of Finance.
Thank you, Madam Chair. Again, to the deputy secretary, please.
Thank you. Go ahead, Mr. Courtoreille.
Thank you, Madam Chair. The largest reasons or the largest reason for the difference is really capacity, and it relates to the previous line of questioning. We typically put to market about $250 million a year in capital, and that's really just a product of the local industry, the construction resources available. And we're also finding that drawing on construction resources from the south is more difficult right now because of the economies that are opening up down south as well. The resources just aren't there. Thank you.
Thank you. Department of Infrastructure, operations expenditures, asset management, not previously authorized, $552,000. Does committee agree?
Agreed.
