REGINA – Saskatchewan Premier Brad Wall says his government has “serious revenue shortfalls” and will run a deficit this fiscal year and next.
Wall told the Saskatchewan Urban Municipalities Association that government ministries and Crown corporations have been told to rein in spending. But “there isn’t much room left, frankly, for cuts,” he said Monday.
“If there were to be more cuts, it would start to manifest in places like health care and in education,” Wall told about 900 delegates at the association’s annual convention.
“We would have to withdraw from the infrastructure side of things to a greater extent. I would worry a little bit about Social Services as well.”
The premier said that left two choices: raise taxes or run a deficit.
Wall suggested that raising taxes could discourage prospective investment, so the government opted for the deficit.
“This is a last resort. This is not something that we want to do,” he said.
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However, Wall tried to stress that Saskatchewan’s economy is “durable” and diversified. He said the books will be balanced once again at the end of next fiscal year.
The province had already moved away from a projected surplus to a $262-million deficit when it presented a budget update last fall.
Finance Minister Kevin Doherty said at the time that his goal was still to balance the books, but warned falling resource revenue was going to make that a challenge. Expenses were also up in large part because of the cost of fighting forest fires last summer.
Wall would not say how much the deficit might be, adding the third-quarter budget update, including the deficit amount, will be released in a few weeks.
The premier said Saskatchewan residents will see the numbers before heading to the polls in a provincial election April 4.
NDP finance critic Trent Wotherspoon says the government needs to be more upfront about the deficit.
“It’s just not acceptable for the government to launch Saskatchewan people into a major financial hole, asking them to pick up the tab, but not be clear about a) the true state, or b) how they’re going to deal with it,” said Wotherspoon.
The Canadian Taxpayers Federation says the government should have made cuts.
“When you have less money, you have to tighten your belt and there are families across Saskatchewan that are doing just that. They’re recognizing that reality and making tough decisions accordingly,” said Todd MacKay, the federation’s prairie director.
“The government doesn’t live in some bubble that makes it immune from the reality of the math of the situation. We’ve got to trim the budget and there’s room to do it.”
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