NWT carbon tax bill passes by narrowest margin in 9-8 vote

A bill that amends the Northwest Territories’ carbon tax to align with new federal requirements has passed by the narrowest of margins in a 9-8 vote.

Kevin O’Reilly, a fierce critic of Bill 60 who would certainly have opposed it and cast a tying vote, was absent from the chamber as third reading of the bill took place.

O’Reilly said by email he was away acting as a medical travel escort for his wife.

The result means a new version of the carbon tax designed by the NWT government will kick in from April 1, and the territory will not default to the federal backstop.

A new approach was required as the federal government has changed the rules under which the carbon tax operates, removing some tools – such as 100-percent rebates at the point of sale on heating fuel – that the GNWT had used to shield residents from the tax’s financial impacts.

The federal government maintains that those rebates defeat the point of the carbon tax – reducing carbon emissions – and undermine efforts to mitigate the effects of climate change.

Without that option, the territory had scrambled to find other measures that achieve similar outcomes. New measures that will now be introduced include a tiered system of cost-of-living offset payments and a process whereby community governments share in around 10 percent of the tax’s revenue that the GNWT collects.

MLAs had already debated the bill at length on Tuesday, and some provided potted recaps of their previous night’s comments ahead of Wednesday’s final vote.

Seven regular MLAs had said they would oppose the bill. Two, Rylund Johnson and Rocky Simpson, said they would join cabinet’s seven members in supporting the bill.

As Wednesday evening’s proceedings began, the two MLAs yet to commit to either side made their views clear: Kam Lake MLA Caitlin Cleveland and Inuvik Twin Lakes MLA Lesa Semmler each said they would not support the bill.

Both said the territorial government had not learned lessons from years of prior discussions about carbon tax and associated recommendations.

“I am being asked to choose between something I don’t like … or an unknown federal backstop,” Cleveland said.

“I trust Minister Wawzonek. She has made great efforts in the past couple of months to try to find ways to collaborate with committee. She is capable and worthy of her role.

“Can I trust every future minister? No. It is our job to pass legislation that can stand without us. I cannot say that I trust who may serve after her and make revenue-sharing decisions on behalf of the Department of Finance in the future.”

‘It shouldn’t have come to this’

With O’Reilly not present, the addition of Cleveland and Semmler resulted in only eight opposing votes. O’Reilly’s vote would have forced Speaker of the House Frederick Blake Jr to break a tie.

“The speaker, by convention, votes to continue discussion and debate, so would have voted in favour of the bill,” O’Reilly said by email, suggesting he expected the bill to have passed even in his presence. But other readings of the same convention suggest Blake could have chosen to oppose the bill – preserving the status-quo of the existing legislation.

Moments before the vote took place, Wawzonek used the debate to launch a fresh broadside at Ottawa for what NWT MLAs are united in considering to be ignorance of the territory’s situation.

“The carbon tax fails to recognize that NWT residents, the majority of whom are Indigenous, do not have access to alternative heating fuels and have no ability to lower their heating costs,” the finance minister said of the federal tax.

“All are facing the financial burden of adapting to and mitigating the risks of a warming climate. None are responsible for the history of greenhouse gases released during Canada’s industrial development.”

Answering criticisms MLAs had levelled at her bill, Wawzonek said there was already plenty of public reporting about the carbon tax (O’Reilly had called for more) and insisted large emitters – in other words, diamond mines – were not getting the unjustly favourable treatment that some MLAs suggest.

Over a sample period, she said, mines collectively paid more carbon tax in the NWT than residents, small businesses and governments put together.

Wawzonek said the bill’s three-tiered system of cost-of-living offset payments, providing larger compensation to families in communities where costs are higher, would ensure the vast majority of people were not financially disadvantaged.

But she also apologized to MLAs for a fraught legislative process that had resulted in the most divisive vote of this government’s term.

Saying sorry to regular MLAs, Wawzonek added: “It shouldn’t have come to this. I hear where people’s frustration is and I know they want to represent their constituents. I do understand that.”