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March 26, 2015
For immediate release
Higher revenue, lower expenses boost third-quarter forecast
Finance and Energy
Increased revenue from crown corporations and reduced expenses by government departments have improved the province’s third-quarter fiscal position by $5 million.
“Islanders expect and deserve a government that is fiscally responsible,” Premier and Finance and Energy Minister Wade MacLauchlan said. “This update provides us with encouraging news that demonstrates how the budgetary restraint of our ministers and department staff is paying off and helping to improve the fiscal outlook for our province.”
Revenue is $14.6 million higher than budgeted, aided by a one-time adjustment of $35 million from the province joining the Cooperative Capital Markets Regulatory System. The Agricultural Insurance Corporation is showing a surplus of nearly $10 million, which will result in lower premiums for farmers in the future.
On the expense side, the severe 2015 winter weather has taken its toll. Overall expenses increased by $9.6 million, most of which were due to December’s floods and clean-up from repeated winter storms. Several departments were able to reduce their expenditures, which helped to offset the increases in other areas.
The province’s total consolidated deficit has dropped to $34.7 million from the previously budgeted $39.7 million.
While the province’s overall net debt may have increased (to $2.151 billion from the budgeted $2.145 billion), the ratio of net debt to GDP began to decline in 2013/14 and did again in 2014/15. The ratio of net debt to GDP is a measure of how large the debt is relative to the economy.
“Three years ago this government made a commitment to Islanders to balance its budget,” the Premier said. “Other provinces are learning that this is not an easy task, but with our small, nimble size and leaders who are dedicated to using taxpayer dollars efficiently and responsibly, we are well positioned to achieve our goals.”