Nunavut government approves another $22M in airline subsidy

Key takeaways: 

• The government has paid $109 million in assistance so far.
• The government of Nunavut has approved another $22 million in support for the territory’s airlines to help them break even. 

$22 million in support by Nunavut government: 

Nunavut’s lawmakers have approved another $22 million to support the region’s airlines break-even to work in Nunavut. 

On Monday, Finance Minister Adam Arreak Lightstone asked the Legislature to cover the airlines from January to March 2022.

He said the extra funds are required to support the airlines continue to keep minimum service to Nunavut’s communities.

“We’re now at the point where the airlines are equally dependant on our support as we are on the crucial services they provide to our communities,” Arreak Lightstone told the House, adding it’s a safe assumption the airlines are not benefiting from the grants.

“We cannot only suddenly end these financial supports that we have been providing. Otherwise, that would have a detrimental effect on our communities.”

To date, Nunavut taxpayers have paid $109 million in subsidies to the airlines, Arreak Lightstone said. But he clarified the airlines had refunded $53 million through duty and medical travel ticket rebates and cash excesses.

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“We’re providing a subsidy to assist the airlines in breaking even with their Nunavut operations,” he stated.

Purchasing a stake in the industry

Iqaluit-Tasiluk MLA George Hickes prompted the minister of finance on whether the government has investigated buying a stake in the airlines, given the subsidies it has paid to them.

Arreak Lightstone himself had presented the idea in the last assembly when he was a regular MLA before becoming finance minister after October’s territorial election.

Still, it’s not a project the government has peeked into.

“If we were to think buying ownership of the airline, it would cost a substantial investment. Something that $22 million would not cover,” Arreak Lightstone stated.

Source – cbc.ca