Nunavut's Finance Minister is forecasting a surplus budget for the coming fiscal year.

Keith Peterson made the announcement during his budget address in the legislature earlier Wednesday.

Peterson presented a careful, measured budget with a projected $21.9 million surplus. This is the second surplus in a row for the territorial government after several deficit budgets.

Keith Peterson, Nunavut's Finance Minister, presented the careful, measured budget in the legislature today. (CBC)

This is an election year, but there's no huge increase in spending — Peterson said the government is staying the course of fiscal responsibility.

“At the same time it is crucial that we rebuild our cash reserves that had been depleted through previous deficits. By restoring these reserves, we will be better able to make prudent investments that will enable more programs and services in the future,” he said.

Peterson said building cash reserves is important with large capital projects on the way, such as the new Iqaluit International Airport.

The territory still gets most of its money from the federal government. Nunavut will get $1.56 billion between March 2013 and April 2014 under the Territorial Financing Formula.

The Health Department is the biggest expense for the territory, getting more than $280 million of the total $1.33 billion operations and maintenance budget. However, the department will no longer be called the Department of Health and Social Services. The new Department of Family Services will start with a budget of $113 million.

Some other highlights include almost $2 million for a new adult education program to help adults get their high school diplomas. Municipalities can expect an extra $4 million more next year, according to a new funding arrangement.

Peterson said that a higher tax rate on tobacco products, which was imposed last year, increased the territory's tobacco tax revenues by $2.3 million.

Other notable expenditures in the new budget are:

• $900,000 to the Country Food Distribution Program
• $29 million more to the Nunavut Housing Corporation’s capital budget, which includes $8 million for 20 public housing units in Arviat, and five new units for Clyde River.
• $5 million for 10 new staff housing units in Cambridge Bay
• an extra $8 million for the Department of Justice
• an extra $1.4 million to the territory’s Internal Sustainable Development Committee to help the territory participate in the Nunavut Impact Review Board’s assessments of big mining projects

The territory also plans to revamp its NNI program to ensure Inuit firms are treated fairly when competing for government contracts.