REGINA – The Saskatchewan government’s latest fiscal update shows a dip in the provincial deficit forecast and a slight slip in provincial revenue and expenses.
The third-quarter report projects the 2017-2018 deficit will be $595 million — down $101 million from the red ink outlined in the last budget.
Third-quarter revenue is expected to come in at $13.9 billion, down $222 million or 1.6 per cent from budget estimates.
The government says that’s largely the result of lower than expected personal and corporate income taxes.
“There was an overestimation of the personal income tax,” Finance Minister Donna Harpauer said Friday. “(It) used the 2016 year for the assessment and right across the nation those numbers were not accurate.”
Expenses are projected to decline by 1.8 per cent, thanks in part to a large reduction in crop insurance claims.
Harpauer said her goal is to balance the budget by the 2019-2020 fiscal year, but diligence will be needed.
“The indicators are forecasting growth, so that’s extremely encouraging,” she said. “But this is not going to be an easy budget that we’re going into either.
“There’s going to be tough decisions that need to be made to keep us on track.”
Cathy Sproule, finance critic for the Opposition New Democrats, said the lower deficit is being achieved by hurtful cuts.
“If you look at the cuts in education, for example, rather than putting (the money) back into the classrooms they’re using it to service their debt,” Sproule said.
“If you look to changes in agriculture … they’re not putting that money back in agriculture — and the same with community development and municipalities.”
The government’s austerity budget last spring in the face of a $1.3-billion deficit received a lot of blowback from unhappy voters. The government expanded the scope of the province sales tax, cut funding to libraries and municipalities and shut down the Saskatchewan Transportation Co.
Reaction was so negative that the Saskatchewan Party experienced a substantial dip in the polls and lost two Saskatoon byelections. Some of the cuts to government programs and funding were eventually scaled back.
New Premier Scott Moe recently announced that the sales tax on agriculture and life and health insurance premiums was being dropped.
The 2018-19 budget is to be tabled April 10.
(CKRM, The Canadian Press)