The Northwest Territories are set to benefit from a significant compensation deal involving cigarette manufacturers. The deal, which is still awaiting final approval in an Ontario court, would see a total of $32.5 billion paid out in compensation. The GNWT has stated that the territory would receive “at least $185 million” as part of this deal.
The proposed arrangement would require cigarette manufacturers like Philip Morris, British American Tobacco, and Japan Tobacco to collectively pay out $4 billion to individuals in Quebec who have experienced smoking-related diseases, $2.5 billion to individuals in similar situations across Canada, and almost $25 billion to provincial and territorial health departments. Additionally, there would be other payments included in the deal.
Although the full amount would not be paid all at once, with an initial payment of $6 billion expected to kickstart the process, the GNWT anticipates an initial payout of $45 million followed by $140 million in the future. The deal still needs approval from a sufficient number of claimants involved in the case and confirmation from the court, which could happen as early as 2025.
If the deal is approved, it would mark the largest resolution of its kind in Canadian history. NWT health minister Lesa Semmler expressed satisfaction with the terms of the deal, highlighting the significant compensation it would provide to individuals and health systems. While the specifics of how the GNWT would utilize its share of the compensation remain unclear, other provinces like Manitoba have already outlined plans to allocate the funds towards specific initiatives like funding a new cancer care facility.
Residents of the Northwest Territories could also be eligible for individual payments under the agreement if approved. Those who fall into the category for individuals outside Quebec and have been diagnosed with smoking-related diseases between 2015 and 2019 could potentially access a payment of up to $60,000. However, the process for making a claim has not yet begun as the compensation agreement is still pending finalization.
Given the financial challenges faced by the NWT, with over $200 million being deducted from the projected operating surplus for 2024-25, the compensation deal could provide a much-needed boost to the territory’s finances. As more details emerge and the agreement progresses towards final approval, residents can expect further information on how they may benefit from this historic resolution in the coming year.