The Yukon is losing $23 million in the transfer payment from Ottawa for next year’s territorial budget, and Premier Darrell Pasloski wants it back.

Pasloski said in an interview Tuesday afternoon he asked federal Finance Minister Bill Morneau on Monday to restore the unexpected reduction in the annual payment.

“What he committed to do was look at it again, but he made no commitment to reinstate it,” the premier told the Star after returning from the annual meeting of Finance ministers in Ottawa.

Pasloski said he has no choice now but to plan the 2016-2017 fiscal budget with $23 million less than the government was expecting.

The reduction is taking $23 million out of the Yukon. It will affect spending across the board, whether it’s for health care, education or what have you, the premier said.

He said the reduction is the result of a new method Statistics Canada is using to determine what numbers to plug into the formula used to calculate the annual transfers to the territories and provinces.

But there’s more to the formula than just hard numbers, said Pasloski.

He said the fundamental principles of the annual transfer include stability and predictability.

The Yukon government only learned of the new calculation at the beginning of this month, he said. He suggested the announcement did not support the principles of predictability and stability.

The letter posted on line by Morneau to the Yukon explaining the annual transfer is somewhat disingenuous, the premier said.

Pasloski said while the federal minister notes the Yukon will be receiving $7 million more than the $874 million it was given last year, he doesn’t say it’s getting $23 million less than originally calculated.

“I am in a position right now where we are planning the next budget, and we have no choice but to budget $23 million less,” the premier said.

Pasloski emphasized the Yukon is in year two of a five-year commitment from Ottawa to the formula financing arrangements.

If the new method of calculating the transfer is allowed to stand for the remainder of the five years, the Yukon will lose well over $100 million in anticipated federal funding, the premier pointed out.

Well over $100 million, he said, is a substantial hit for the territory.

As a result of Monday’s discussions among the Finance ministers, Pasloski said, it was decided to defer any decision on increasing contributions to the Canada Pension Plan while officials explore options in advance of next year’s annual meeting.

The matter of federal support for spending on infrastructure did arise. There was no indication how quickly the new Liberal government will make money available as promised by Prime Minister Justin Trudeau, he said.

Tim Shoniker of the territorial Department of Finance said Tuesday calculations by his department in October and November were still showing the next federal transfer would be $23 million more.

It was only at the beginning of this month they learned otherwise, he said.

Shoniker said the reduction was not the result of a political decision. Rather, it stems from a Statistics Canada decision to refine the method used to calculate the transfer payments to the territories and provinces, he said.

More specifically, Shoniker explained, it was a change in the method to assess and apply expenditures by provincial and local governments. Those expenditures are reflected in the formula used to calculate the annual transfers, he said.

In the first year of the five-year agreement, he added, the Yukon received $851 million for the 2014-2015 fiscal budget and $874 million for this fiscal year.

Under the previous method of calculating the transfer, the government was anticipating a transfer of $901 million for the 2016-2017 year, Shoniker said.

He said it was a “shock” when they learned of the new calculation on Dec. 1.

The Northwest Territories says its grant will be slashed by $34 million.

Nunavut’s cut is estimated at more than $50 million.

Yukon MP Larry Bagnell said early this afternoon he too just learned of the new method to calculate the transfer payments, so he doesn’t have specific details. He has asked the federal minister’s office to provide them.

“He (Morneau) has asked his officials to work with their territorial colleagues to see what the options are to address this,” said the Liberal MP. “He certainly asked them to address this concern.”

Bagnell said overall, the Yukon can expect to see more federal money flow into the territory based on Liberal commitments, such as raising the amount for the monthly Child Tax Benefit.

On the subject of the pension plan contributions, the premier said with an economy that is already in the doldrums, it’s the wrong time to take more money out of circulation and direct it to higher pension contributions.

“I think the timing is not right to do that,” Pasloski said.

The federal Liberals promised as part of their election platform to explore increasing pension contributions and payouts, though they need the support of at least seven provinces with more than 50 per cent of Canada’s population to make the changes.

Pasloski said the Finance ministers decided to direct their officials to examine options, from making no changes to making substantial modifications.

Progress will be reported at the mid-year meeting next June.

The matter will come back for the ministers’ further consideration at their annual meeting next December, he said.

There needs to be an assessment of how other mechanisms are helping Canadians prepare for retirement, such as the effectiveness of the relatively new tax-free savings accounts, he said.

Pasloski said the Finance ministers also wanted some indication from the federal minister about how quickly the new government will come forward with its commitment to stimulate the economy with infrastructure money, though they did not receive anything firm.

From the territorial and provincial perspectives, the sooner the better, he said.

The Yukon, Pasloski pointed out, has already advanced shovel-ready infrastructure projects for consideration.

Bagnell said any proposals that were in the system before October’s election will continue along their normal course and will not be affected by the vote.

He added he’s not sure when they’ll begin seeing the new commitment for more federal funding for infrastructure support.

“I hope it is soon,” he said, adding he knows a number of Yukon projects were in the hopper prior to the election.