“The lingering effects of the global downturn have remained a challenge for Prince Edward Island,” says Minister Sheridan. “However, I am confident that we remain on target for budgetary balance within the next three years.”

“Our provincial economy is remarkably resilient. Therefore, a measured and deliberate approach will allow government to gradually reduce and eliminate deficit financing,” said Minister Sheridan.

From the widest perspective, the current year forecast deficit represents roughly 4.8 per cent of government’s total budget of $1.531 billion. This is up from the original estimate of 2.7 per cent.

“Much of the fiscal pressures we are experiencing this fiscal year relate to higher public service pension costs, increased supports to primary industries and increased expenditures on social service programming,” said Minister Sheridan.

In the current year, pensions and employee benefits are expected to require an additional $12.3 million. In total, provincial expenditures are $20.8 million higher than estimated. Included in this number, the province’s approach to debt management has seen interest costs drop nearly $3 million – from $108.1 million to $105.3 million. Revenue pressures account for $10.6 million of the increase to the deficit.