Federal Finance Minister Bill Morneau announced Tuesday that the Government of Canada will restore $67 million that was cut from the 2016/2017 territorial transfer payments.
In late 2016, all three territories learned that federal transfers would be inadvertently cut by $91 million because of changes at Statistics Canada.
The payments are an annual transfer from Ottawa to each territory, partly based on population size, to help provide for public services.
Following the $91 million cut, the Yukon was slated to receive $930 million in federal transfer payments in 2016/2017, the Northwest Territories was expected to receive $1.256 billion and Nunavut was set to receive $1.154 billion.
That would represent a cut of roughly $23 million in annual funding for the Yukon and a loss of $34 million for both the NWT and Nunavut.
Since December, all three territories have called on the Government of Canada to address the situation. Morneau announced the changes in the House of Commons on Tuesday.
“I am pleased to bring forward a solution that will not only help mitigate the effects of this data revision in the immediate term; it will also improve and strengthen the program over the long term by making Territorial Formula Financing payments more stable and predictable going forward,” he said in a statement.
The announced amendments mean $67 million will be restored to the territories compared to the amounts that were calculated in December. It’s not yet clear how much money will be reallocated to each territory specifically.
Morneau made the announcement after Northwest Territories MP Michael McLeod asked for an update on the funding review.
“Today’s proposed fix to the Territorial Formula Financing program will provide the North with more financial resources in the short term, and the fiscal stability and predictability we will need to grow and share in the prosperity that our great land and people hold,” said McLeod in a statement.
Territorial Formula Financing payments change from year to year as new and updated information is incorporated into the program’s legislated formula.
In all, the federal government will provide over $3.5 billion in funding to the territories in 2016/2017 through transfers.
In the NWT, federal transfers account for roughly 68 percent of the territory’s total revenues for the 2015/2016 fiscal year.