Conservatives will let NWT set own debt limit, double residency deduction

With the party’s NWT candidate silent, Conservative federal leader Erin O’Toole has set out the party’s pledges to the Northwest Territories in a letter to Premier Caroline Cochrane.

According to the territorial government, O’Toole is the first to respond to letters sent by the premier to the Liberal, Conservative, New Democrat, Green, and Bloc Québécois leaders at the start of the month. The NWT’s Conservative candidate, Thunder Bay-based Lea Mollison, says she has been instructed not to agree to interviews.

In his response to Cochrane, O’Toole says his party will double the northern residents’ tax deduction if elected and let the territory set its own borrowing limit, which is currently overseen by the federal government.

That borrowing limit is likely to face imminent strain. Ottawa increased the NWT’s debt cap from $1.3 billion to $1.8 billion a year ago, but the NWT already projects it will reach the new limit by the 2023-24 financial year, if not sooner as pandemic-related costs escalate.

The NWT’s NDP candidate, Kelvin Kotchilea, has advocated for increasing the territorial government’s borrowing limit to allow investments in green infrastructure and move communities away from diesel. The Liberal government has consistently increased the NWT’s debt limit as the territory has neared it.

O’Toole said allowing the NWT to choose its own borrowing limit represented his party’s commitment to “complete devolution.” He said that would include being “fully committed to reconciliation” and advancing land claims and self-government agreements.

The Conservative leader said the residency deduction had not increased since 2016 and doubling it would “recognize the rising cost of living in the North.”

Among other specific pledges, O’Toole said his party would invest in community-based marine fisheries in Inuvialuit communities.

More generally, he promised improvements to Nutrition North and a “generational investment in infrastructure,” including earlier pledges to build a road to Nunavut’s Grays Bay and a deepwater port in Tuktoyaktuk. (O’Toole’s letter also states Conservatives will work on “completing the Tuktoyaktuk road,” though no more detail was provided. The Inuvik-Tuktoyaktuk Highway opened in late 2017.)

There was also a commitment to more money for healthcare and a new housing strategy with “stable and predictable” funding. The NDP made an NWT housing announcement of its own on Tuesday – details will follow – while the Liberals issued a news release promising to build more homes across Canada and make owning them easier.

O’Toole said mining, oil, and gas in the NWT still held “enormous economic potential” and a Conservative government would encourage Indigenous communities to pursue that potential while holding projects to “world-leading environmental standards.”

He said the Conservatives would scrap the Liberal carbon tax – something the NWT’s own finance minister at the time recommended the territory should do, even as he introduced a territorial carbon tax adapted from the Liberal plan – and replace it with a “personal low-carbon savings account.”

That account, O’Toole argued, would “put a price on carbon for consumers without one penny going to the government.” In many instances, the NWT government says, the existing carbon tax ends up giving back more to NWT families than they pay in the first place. Many elements of the NWT’s carbon tax, such as heating fuel for homes, are subject to a 100-percent rebate.

The Conservatives’ carbon pricing plan and environmental policy have been both hailed as a significant improvement on the party’s 2019 stance and criticized as doing too little compared to rival parties. O’Toole said his party would “secure the environmental future of our northern territories,” in part by providing infrastructure investments with “a mitigation and adaptation lens.”

Cochrane’s letters ask party leaders how they will give the NWT “fiscal flexibility,” how they will help the NWT’s economy develop, how climate change will be addressed, and how reconciliation will be advanced.

Less than a week remains until polling day on September 20. Advance polling closed on Monday, while Tuesday is the final day to apply for a mail-in ballot.