My question is for the Minister of Finance, and it’s an attempt to once again bring clarity to an issue that keeps bubbling away out there. I was astounded to hear this morning on CBC radio — I believe it was Mr. Lee Selleck talking about hearing Mr. Abernethy, who said that there would be a reinvestment of $70 million along with cuts of $135 million. Mr. Selleck wondered if it was actually a leak of information. I was equally astounded the other day to talk to the author of a Parkland Institute report, an excellent researcher and so on, who knew nothing about it.
We’ve raised the issue of communications before, but this is such a fundamental issue. It’s still clouding the public understanding and ability to bring analysis to the government’s moves. Just for the public record and for absolute clarity, was the original intent of this government to find $135 million in cuts and during a similar period to reinvest about $75 million in areas of priority, for a net reduction of $60 million roughly over two years?
The Hon. Premier, Mr. Roland.
As the Member has laid it out, that is the scenario. The overall target is $135 million; $75 million of that $135 million was targeted for reinvestment in priorities of the Legislative Assembly. That number is affected by the fact that if we can achieve our reduction scenario.... And that’s somewhat limited. We were hoping to do that, and part of the discussion we had earlier on was that it is $135 million, but we want to reinvest the $75 million. It wouldn’t be $75 million up front in one year. We realize that it takes, as we pointed out, two years to actually see the net impact of some of our reduction scenarios. The original amount we were hoping to reinvest would have been $25 million this year. That is investing in new priorities. There was, as I said, work done in the previous government under some initiatives that were sitting there. We reviewed those, and that’s part of the package you see today.
Thank you for that clarity. I hope that word gets out. I cannot believe that we’re at this stage and there’s still confusion out there on such a fundamental fact. Just for further clarification on the Minister’s later remarks: how far are we down that road toward the $135 million and the reinvestment of $75 million with this budget today?
Mr. Speaker, with the package we’ve met so far, there are a couple of things we have to consider. I mentioned earlier in my Budget Address the sunsetting of programs. Those were already on the list to be ended. Whether a department came forward for three-year money or one-year money or it was federal transfers that only lasted a couple of years, sunsetted money meant those programs were to end on that year. So we’ve had about $30 million of those sunsetted dollars identified in this budget. We’ve had a further $35 million, if I don’t have my numbers reversed, in meeting our reduction targets, which has limited us. We’re not able to reinvest the $25 million.
Again, when we talk about the budget and all the reinvestments and capital and so on, there are some initiatives from the previous work that was done that have been carried through. But the targets we’ve set up, we’ve not met, and we’re going to have to look at refocusing government initiatives. As I discussed earlier, the rest of that work will follow through the business plan, where we will sit down with Members, through these strategic initiatives and then right through departments as well.
Again, thank you for those remarks. Does the federal program that we’ve now learned about — the Building Canada Fund, somewhere between $27 million and $35 million a year — contribute and allow us to cut less to achieve our budget goal?
Just to add to that, if I can. Am I correct, from the Minister’s remarks, if I said we were about a third of the way on the cuts? A quarter?
Mr. Speaker, first the question about the Building Canada Fund. The Building Canada Fund is capital dollars. It’s not O&M dollars. In a sense, it does help us, for example, to flow through more capital, because it’s cost-shared dollars. For example, the Kakisa River Bridge: it’s allowing us to invest in that area. The Yellowknife bypass road: cost-sharing with the City of Yellowknife and flowing through those dollars to meet theirs helps that project that wouldn’t have been on there before. There are a number of areas where it does save us some investment so that we can spread the capital out to other projects. So it does save us that way, but it’s capital dollars. It’s not O&M dollars, so it doesn’t help us to reduce our targets in that fashion.
The other questions about the percentage of targets that we’ve met.... If you look at this budget and we take the $35 million that has been met, if we can match that during the next budget cycle we go through, then we’ve met the hard dealing with our fiscal growth pattern. The rest of it we could deal with through managing the growth of departments, through forced growth and new initiatives pieces. If we don’t meet those, that means less reinvestment.
Thank you, Mr. Roland. A final short supplementary, Mr. Bromley.
Again, Mr. Speaker, thank you for those remarks. One final one on the cuts. I believe layoffs were something we had discussed early on as part of the cuts. They were intended to be based on a thoughtful, comprehensive program review, possibly even a zero-based review. Were those reviews done as a basis for those cuts, and if not, should those cuts have been delayed?
Mr. Speaker, the fact that we’ve had the impact of reductions in personnel…. I’ve said on a number of occasions in this House, in the media — and I know Members were not happy with that, even when I said it at that time — there would be some impact there. When half of your budget deals with compensation and benefits of your workforce, and even if you reduced just program areas, there are people attached to those programs and delivery of them; so there was that impact. We’ve minimized that as much as possible. In fact, some of those who are affected have been contacted for potential redeployment, getting them into the new initiative pieces we will be delivering. So we’re lessening that impact, as well, on that side of it.
When you look it, the scenario was that we went to departments — of the $135 million total reinvestment and direct reductions — based on the size of their budgets. So the larger your budget, the larger portion of the percentage you got from the overall target. That was different from previous years. In previous years a department was just given a flat percentage. We didn’t go that route, and they were told to come and meet their target. A number of departments did not meet their targets. We knew they didn’t align themselves with the priorities of this Assembly. So we’ve not proceeded on quite a number of fronts, but we’ve put more work into the Refocusing Government piece. Again, Hon. Michael Miltenberger will be ready to meet with Members as we prepare for the next stage of our work in budget planning.
Thank you, Mr. Roland. The Member for Hay River South, Mrs. Groenewegen.
