Economic forecast confirms Yukon Party government's bad financial choices
Today’s Conference Board of Canada Territorial Outlook confirms the Yukon Party government’s failure to be responsible managers of the territory’s economy, say the Yukon NDP caucus. The forecast, warns Yukoners to prepare for hard times ahead as the mining industry on which Yukon relies continues to slow down. The Yukon NDP caucus has consistently pressed for a greater focus on economic diversification, especially in the energy sector.
The Conference Board tells the hard truth: “of all the provinces and territories, Yukon’s economy is facing the bleakest near term outlook” as this year’s forecasted 3.6% Gross Domestic Product growth will be wiped out by a 7.7% decline in 2017 and a further 3.1% slide in 2018. The report forecasts Yukon job losses while employment grows in the Northwest Territories and Nunavut, facing the same mineral prices.
Today’s report is bad news for Pasloski. It shows the Yukon Party government has squandered the $80 million surplus forecast in its first budget in 2011. By failing to support the economy with smart and sustainable public spending and economic diversification measures, the Yukon Party is leaving the territory at the mercy of the global downturn in commodity prices which will halt Yukon’s economic growth.
“Today’s Conference Board report is more proof that the Yukon Party government has driven Yukon’s economy into the ground,” said Yukon NDP Leader Liz Hanson. “We need to build a more diverse and flexible economy; mining will always play a role in Yukon’s economy, but we have to acknowledge the ups and downs of commodity prices by supporting other industries.”
Hanson points to the Yukon communities that are working together to develop a local renewable energy economy as a good example of a budding, job-creating sector. By developing solar energy infrastructure, through local government projects in Mount Lorne, Old Crow and Mayo, or small hydro or geothermal energy, Yukoners can cut their cost of living by reducing the territory’s need for fossil fuels to heat homes. Yukoners are increasingly taking stock of their ability to play a virtual role in the growing information technology economy. The Yukon NDP caucus believes supporting local diversification including focused and smart investment in boosting Yukon’s tourism industry will create a more robust and resilient Yukon economy.
“There is a better way,” added Hanson. “Yukon citizens deserve a government that listens to them, that is open and accountable. As this latest report points out, Yukon is facing many challenges – the Yukon NDP will work with Yukoners to build a diverse and resilient economy that will avoid the economic roller coaster created by the Yukon Party government’s single-minded focus on boom-bust economics.”
CORRECTION: In the original version of this statement, we believed that the figures for Yukon’s net debt (Table 4, p. 53) indicated a 2015-16 deficit of $131.7 million.
We misread the report’s double negative of -$131.7 million in net debt as $131 million of debt – not $131 million in surplus, a figure which is forecasted to become a $211.9 million debt by 2020.
We interpreted Yukon’s net debt figures with the belief that the report’s authors might have had access to the latest figures for Yukon’s Crown corporations, whose debt is guaranteed by the Yukon government. According to 2014-15 data, the Yukon Development Corporation owed $122.4 million, the Yukon Housing Corporation owed $3.8 million and the Yukon Hospital Corporation owed $45.8 million.
The Yukon NDP caucus believes that omitting the Crown corporations’ debt fails to tell Yukoners the full story about the territory’s financial wellbeing.
While we regret the error in this statement, we believe that Yukon’s finances remain in a precarious situation.