Arctic Yearbook 2014 - Page 214

214 Arctic Yearbook 2014 demonstrates the risk when fund rules can be ignored, particularly if they are not clearly established, or if exceptions allow for significant departures from the rules (The Fraser Institute, 2013). As there were no rules governing minimum resource revenue deposits into Alberta’s Fund, regular contributions to the Alberta Fund were suspended from 1987 until 2005 and minimum required contribution deposit rules were established only in 2013 (Revenue Watch Institute & Vale Columbia Center 2013c). Enacting strong deposit, withdrawal, and investment rules will help mitigate potential risks. Issue 3: Establish Robust Transparency and Oversight Mechanisms – Including Appointment of a Supervisory Council to Oversee the NWT Heritage Fund A key recommendation in the policy report (Briones et al. 2014) was expanding the Secretariat of the Fund to form a Supervisory Council. The Supervisory Council would provide independent expert finance directors, and be composed equally of representatives of various government authorities, legislators, Aboriginal Governments, financial experts, academics, and civil society, to oversee the fund on behalf of the government. The majority of members must have security of tenure and be completely independent of the government for this model to work effectively. This Supervisory Council would replace the Secretary of the Financial Management Board and report directly to the Minister of Finance, as well as to the Legislative Assembly. Successful funds are not only an outcome of good fiscal policy; they are facilitated by robust internal controls, supervision, public oversight, and transparency. For the Supervisory Council to be successful, qualified individuals must be appointed, with a strictly vetted job description process, to avoid the risk that the council could be a channel for nepotism and patronage. The Supervisory Council should include diversity of representation from independent representatives of the public as well as financial experts. Further elaboration by the authors, in consultation with the GNWT, is being undertaken to support regulation in this area. NWT’s Current Fund Governance Model Figure 4: Existing Structure of the NWT Heritage Fund’s Governance A Question of Future Prosperity