Fuel tax bump, teacher cuts, closures highlight 2015 New Brunswick budget

Above: Finance Minister Roger Melanson released the 2015 Budget, Laura Brown reports.

FREDERICTON – Increasing fuel taxes, the closing of four rural courthouses and six Service New Brunswick locations are some highlights of New Brunswick’s first provincial budget under Brian Gallant’s Liberals.

Finance Minister Roger Melanson tabled the budget in the legislature Thursday, where he made it clear “difficult decisions” had to be made, and more are still to come.

He revealed a $150-million contingency fund for the upcoming fiscal year that has increased the projected deficit to $476.8 million.

“By introducing a contingency reserve, we are demonstrating prudence in our budgeting given the number of factors beyond our control that affect our economy and revenues.

“It is not a license to spend,” he said.

Tweet This Click to share quote on Twitter: "It is not a license to spend," he said.

But there was no mention of an increase to the harmonized sales tax or highway tolls.

“We understand that some communities may not be happy with this decision,” Melanson said. “But New Brunswickers can rest assured that there will remain a number of options in which to access the services they need.”

During the last election campaign, the Liberals promised to spend $600 million over six years for improvements on infrastructure including roads and bridges.

Seniors pay more for prescriptions and long-term care

Several budget highlights focus on asking seniors with “greater means” to pay more for their prescriptions and long-term care.

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The Province is removing the maximum daily amount a senior pays for nursing home care, which is currently $133 per day. The cost of nursing-home care is about $233 per day.

“By removing this cap, we will ensure that the wealthier clients who can afford it contribute a little more towards their care,” he said.

The province will continue to subsidize the cost for those seniors who need it. However, liquid financial assets like savings or investments will no longer be exempt from a senior’s assessment of their ability to pay for long-term care.

Melanson also announced premiums will be increased for seniors’ Medavie Blue Cross Seniors Prescription Drug Program. Premiums haven’t increased for the program since 2009.

2015/16 budget highlights

• Increasing income taxes for the richest one per cent of New Brunswickers by introducing two new tax brackets for those who make between $150,000 and $250,000 and those who make more than $250,000
• Closing courthouses in St.Stephen, Sussex, Grand Manan and Grand Falls
• Increasing fuel taxes on gasoline by 1.9 cents per litre and on diesel fuel by 2.3 cents per litre
• Closing Service NB outlets in Saint-Quentin, Saint-Leonard, Port Elgin, Hopewell Cape, Gagetown and McAdam and consolidating some in Miramichi
• Teaching positions reduced by three per cent or 249 positions
• Increasing premiums for seniors using the Medavie Blue Cross Seniors Prescription Drug Program

Above: Reaction the budget is getting mixed reviews Emily Baron Cadloff reports.

Reaction to budget mixed

Kevin Lacey, with the Canadian Taxpayers Federation, says despite talks of strong cuts, Melanson didn’t go far enough.

“The deficit will grow in this budget $1.6 million every single day,” said Lacey. “This budget comes up far short from addressing the fiscal concerns, as well as growing the economy which is what we actually need to happen in order to balance the budget.”

But others say this budget is a good first step for the Gallant government. Denis Robichaud, with the Canadian Federation of Independent Business, is pleased there was no hike to HST.

He says 77 per cent of the CFIB membership voted against a tax raise.

“We are giving a B-minus to this budget,” said Robichaud.

Tweet This Click to share quote on Twitter: "We are giving a B-minus to this budget," said Robichaud.

“We’re seeing real progress to eventually cut spending, to reduce spending at the provincial level.”

The changes in this budget will affect a few groups right away. For university students, the budget froze tuition rates, but it also froze funding to universities, and scrapped the tuition rebate program.

Pat Joyce, with the N.B. Student Alliance, says this makes students nervous about the priorities of government.

“I think that this budget sort of treats post secondary education as expenditure, when in reality it’s an investment,” said Joyce. “We’ve seen evidence that post secondary education contributes to economic growth, provides jobs, and really stimulates the economy, and that sort of seemed to be missing from this budget.”

READ BELOW: The New Brunswick Department of Finance’s 2015-16 economic outlook

Read more from our live blog:

With files from The Canadian Press