YELLOWKNIFE (February 4, 2016) – Premier Bob McLeod announced today that a new Fiscal Responsibility Policy has received Commissioner-in-Executive-Council approval following its recommendation by Cabinet.
The Fiscal Responsibility Policy (FRP) is a public statement of the Government of the Northwest Territories’ (GNWT’s) commitment to maintaining long-term fiscal sustainability by spending responsibly, controlling expenditure growth and prudently managing borrowing and debt repayment in keeping with principles and provisions outlined in the new policy.
The FRP identifies the purposes for which the GNWT may borrow money, requires the GNWT to prepare an annual borrowing plan, sets out requirements for debt repayment and establishes performance measures for rating debt. It defines limits on debt servicing payments to ensure that GNWT debt and borrowing remains affordable and debt servicing payments do not adversely impact programs and services. The policy also requires the GNWT to generate operating surpluses to finance infrastructure investments, with a minimum of 50 percent of the funding for capital projects to come from operating surpluses and a maximum of 50 percent to come from debt.
“The Fiscal Responsibility Policy reflects the GNWT’s commitment to live within its means and provides the rationale for all government financial planning and management decisions,” said Premier McLeod. “The policy recognizes that debt should be maintained at sustainable levels that do not jeopardize the delivery of government programs and services, that financial risks should be managed prudently, and that the GNWT should have a fiscal decision making system that is rational, fair, efficient, credible, transparent and accountable.”
Commissioner-in-Executive-Council approved policies represent the GNWT’s commitment to the public to follow an action or course of action in pursuit of approved objectives approved at the highest level. The FRP replaces the previous policy approved by the Chair of the Financial Management Board.
Senior Cabinet Communications Advisor
Department of Executive
Government of the Northwest Territories
Tel: 867-767-9140 ext. 11092