Western Arctic MP Dennis Bevington introduced a private member’s bill to increase the Northwest Territories borrowing limit last week in the House of Commons.
Bevington’s bill, which he introduced on Thursday, would increase borrowing limit and create a formula to establish the borrowing limit each year. It would require amendments to Section 2 and and Subsection 20(2) of the Northwest Territories Act.
“Right now the borrowing limit is set by the cabinet – it’s set at $500 million,” he explained. “What I wanted was a borrowing limit that was tied to the expansion of the government. As its gross revenues increased, it could see an increase in the borrowing limit.”
Setting the borrowing limit at 70 per cent of the NWT’s gross revenues would result in a borrowing limit of up to one billion dollars. The increased limit would help the GNWT invest in projects such as the proposed Taltson Hydro expansion, Bevington said.
“The government’s having trouble borrowing the money to do a project like that – they’ve been looking at private investors from the south to come up and develop that project,” he said. “Hydro-electric power is part of the heritage for almost every province in the country. We’re going to not have the fiscal capacity to put in place projects that are cost-effective and actually turn a profit to the government.”
Much of the current borrowing limit is taken up with NTPC debt, Bevington said. Having the increased limit would allow the GNWT to look at investing in shared-cost programs – including the Mackenzie Highway, Bevington noted.
“Not only would they have their own source of fiscal capacity, they could attract shared programs from the federal government,” he said.
Bevington said he was confident the GNWT would be able to invest wisely with the added borrowing capacity. It would also act as a practical way to move towards devolution.
“I think we’re ready for it,” he said. “I think the government’s proven it over the years that it has the need for the capacity. We’ll be missing opportunities that we could pick up on if we don’t have that capacity.”