Whitehorse Daily Star

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Photo by Morris Prokop

MANY DECISIONS TO MAKE – Premier Ranj Pillai discusses the Yukon Fund during last Thursday afternoon’s news conference at the Jim Smith Building.

‘It’s time to start saving for the long term’

Premier Ranj Pillai has announced a new fund for Yukoners.

By Morris Prokop on April 1, 2024

Premier Ranj Pillai has announced a new fund for Yukoners.

Speaking at a press conference last Thursday afternoon at the Jim Smith Building, Pillai said the Yukon Fund is designed to provide long-term financial benefits to future generations of Yukoners.

The funds come from the 1993 Canada-Yukon Oil and Gas Accord, where the federal government committed to provide future offshore revenues to northern governments.

The Yukon Fund plans to harness financial resources from historic oil and gas activities in the Beaufort Sea, accessed through the Western Arctic-Tariuq Offshore Accord, similar to funds in Alberta, Newfoundland and Labrador and Norway.

The funding moved a step closer to reality when the accord was signed last summer by the federal, Yukon and Northwest Territories governments and the Inuvialuit Regional Corp.

It establishes resource revenue-sharing from exploration and development in the Beaufort Sea.

The amount of funding the Yukon will receive is subject to ongoing negotiations.

“In Budget 2024-25, we outlined our plans to create this new sovereign wealth fund, which underscores the Government of Yukon’s commitment to ensuring that all Yukoners benefit from our natural resources,” said Pillai.

“It is one of the many ways we are celebrating the Yukon’s 125th year, which continues until June 13 of this year.

“The decisions we make today are not just for the present, but are made with foresight to prioritize the health, well-being and prosperity of future generations of Yukoners.”

The Yukon joined Confederation on June 13, 1898.

One dollar has been symbolically allocated to Budget 2024-25 to initiate the fund.

Efforts are currently underway to establish how the fund will work.

Later this year, officials plan to engage Yukoners on the vision for the fund and how it will be dispersed.

Pillai said the Executive Council Office, alongside the Departments of Finance and Justice, are working with other governments that have experience managing these kinds of funds.

Speaking to reporters, Pillai said one of the keys is figuring out who should oversee the fund.

According to Pillai, Yukoners will determine what the fund is used for.

“Should it be Yukoners, should it be government officials? Those are the kind of questions that we’ll ask.

“The second point would be: how is the fund structured? How much do you want to see built up in the fund before you disperse?

“What’s your investment strategy? That’s another really important question. But we want Yukoners to define that.”

Pillai went on speaking about parameters of the Yukon fund.

“How big do you want that fund to be? Should it be $100 million? Should it be $125 million first, because we’re announcing it on the 125th anniversary of Yukon?

“The last part of that is how do you disperse? I would hope that we’re not going to see this fund go to general expenditures that we have on an annual basis.”

Pillai also pointed out that “when we have royalties that come from the mining sector, or from the resource sector, there’s a portion that comes to the Yukon government and there’s a portion that’s distributed to First Nations.

“We’re not talking about any of the dollars that go to First Nations governments. We’re talking about how we would use a portion of the funds that come to the Yukon government after we’ve distributed to First Nations governments.”

Pillai said it was “important to speak to this today since it’s in the budget.”

Asked about the timeline, the premier replied, “We’ll know the exact amount of money this year.

“The Northwest Territories government is going through an internal process. We know that there is just over $25 million that will be shared between the Northwest Territories government and the Yukon government. So we’ll take our portion of that.

“Each year, depending on how much our royalties are, there’s a calculation made between the Canadian government and the Yukon government, so at a minimum $6 million, it might be closer to $10 million. That would be the first allotment that goes into the fund.

“And then over this year, we will have a chance to take that fund, put it into a structure and then we will define how future revenue is put into the fund.

“Depending on how much information we get from Yukoners, we’ll be able to tell you exactly what that fund will grow to, and how it will be structured and how it should be dispersed. Those are all the things we want to get completed this year.”

Pillai confirmed that the funding will come from royalties.

“What we’re looking for is to take those funds, put them into a long-term savings account.

“I think it will give a greater appreciation and understanding for Yukoners on how important the resource sector is to this economy.”

Pillai said the money could be used for capital projects or to support infrastructure, such as that for health care.

He pointed out that they’re talking about a number of years of contributing to the fund before it is allocated to “the values and priorities that Yukoners will identify.

“It’s time to start saving for the long term. We’ve got some significant funds that are coming in,” he said.

“We’re gonna put those in place, and start thinking about giving us some indication of what you think we should do with this money.”

Pillai said members of the public could help oversee the fund, but that is also to be determined.

He reiterated that the fund could grow to $100 million to $125 million.

Pillai added he will have updates on the newly-formed Yukon fund in the future.

Comments (4)

Up 1 Down 0

douglas martens on Apr 7, 2024 at 7:17 am

imagine, if you will, a country so deeply in debt bondage, that it cannot afford to house or provide medical care for it's own citizens, discussing a sudden urge to save for the future...

Up 56 Down 11

Guncache on Apr 2, 2024 at 7:48 pm

The Liberals don't know what the word "savings" mean

Up 76 Down 10

Groucho d'North on Apr 2, 2024 at 11:17 am

I find it remarkable and a bit disingenuous that fossil fuels can be both an identified enemy of society AND a montetary mechanism to create new wealth. I anticipate there will be lots of spin in this project.

Up 84 Down 8

Jack on Apr 1, 2024 at 7:43 pm

A sovereign wealth fund is meant to be invested wisely and built for future generations over the very long term, not 'allocated' and spent by the current governments.

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