2010 budget shouldn't make waves: economist - NEWS 95.7
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2010 budget shouldn't make waves: economist

One economic group says it’s not expecting any major changes in the 2010 budget.

The legislature will reconvene on Thursday, and the budget will be tabled soon afterwards.

The Atlantic Provinces Economic Council is expecting a medium-fiscal plan focused on steadily reducing the deficit over the next few years.

“They’re obviously not going to take significant steps to reduce the deficit next fiscal year,” said senior policy analyst Fred Bergman. “But they can tell us what the medium-term fiscal plan is to reduce the deficit.”

Bergman says we shouldn’t see any big cuts to programs or any big spending announcements.

“The reason you don’t want to do anything significant next fiscal year is, they’re still pumping money into the economy via economic stimulus, i.e., the province is spending $1.4 billion over two years,” he said. “I don’t think it’s a good idea to eliminate or reduce that because that’s helping us return to economic recovery.”

Bergman says he also believes it would be unwise for the government to impose significant tax hikes before the economy is on more stable footing.

However, he says he’s looking for at least a hint on how the government plans to control spending.

“To date we haven’t seen any real wage control put in, as an example,” he said. “That’s not going to get them significant dollars but we have not seen any wage freeze, we haven’t seen any wage cuts.”

Premier Darrell Dexter says he expects spending controls will roll out “over a number of years,” but adds the public will notice an impact when the government’s second budget is introduced.

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