Effective: January 29, 2018
Applicable FAM Policies: 640 – Forgiveness and Remission of Debt
Applicability: GNWT Departments and Public Agencies

Accounting Services, Department of Finance, coordinates all submissions from Departments and Public Agencies for the consideration of forgiveness or remission by the Financial Management Board. Forgiveness or remission should only be submitted for valid debts, not to address a debt that has arisen as the result of an administrative error.

INTERPRETATION

Comparisons of debt eliminations methods under the FAA:

Considerations for Forgiveness or Remission

Debts should be considered for forgiveness or remission if any of the following conditions apply to the debtor:

1. has died leaving no known estate
2. cannot be located despite significant efforts;
3. is indigent;
4. is not resident in Canada, where there are no apparent means of collection and there is no indication that the debtor has family or business ties that might encourage him to return to Canada;
5. has not admitted liability and the success in collecting is unlikely;
6. is an inoperative corporation without assets; or
7. it’s uneconomical to pursue;

Financial Management Board (FMB) Submissions

All FMB submissions for Forgiveness or Remission are to be consolidated and submitted by Accounting Services, Finance. Submissions for the forgiveness and remission should, as applicable, include the following information:

• specific circumstances, including the dates under which the debt arose (i.e. the way in which the debtor's liability was established);
• a summary of collection actions taken and the results;
• details of legal action taken and legal opinions sought;
• financial status of the debtor, including a search of the records at the Sheriff’s office for outstanding judgements;
• a list of directors, if the debtor is a corporation;
• a reconciliation of the original debt to the amount submitted;
• the name, title and telephone number of a department contact;
• whether corrective action can be taken or has been taken to prevent recurrence of a similar failure of collection action; and,
• an indication as to whether the debtor (individual(s) or organization and its principals as applicable) has had debt owed to the Government/public agency which was previously written off. This information is available from Accounting Services, Finance, and is to be included in the submission.

Financial Systems and Reports

The Financial Reporting and Collections Section shall maintain and make available on request to Government departments, and Public Agencies, a current database of all approved forgiven and remised debts that have been forgiven or remised by the Government and public agency.

Seeking Remission

Social Assistance Act

The department responsible for the administration of the Social Assistance Act must provide a list of all debts forgiven by the Minister in a fiscal year to Accounting Services, Finance by April 15 following the end of the fiscal year.

Student Loans

Forgiveness does not apply to student loans in accordance with the Student Financial Assistance Act and the Student Financial Assistance Regulations. Remission may be granted by the Commissioner.