Nova Scotia’s response in the early days of the COVID-19 pandemic shrunk its surplus to $2.3 million for the fiscal year that ended March 31 – a figure $31.3 million smaller than initially projected in the 2019 budget.
Finance Minister Karen Casey said Thursday the province saw a $485.5-million increase in expenses, mainly due to $120 million in COVID-19 relief funding, demand for various health care and other social services, and the remediation of Boat Harbour.
“The impact of our COVID-19 response has been significant,” Casey told reporters. “The month of March saw the beginning of that impact.”
Also on the books, Casey said, is an additional $50 million for a COVID-19 support fund for individuals and businesses, which is being managed through an agreement with Dalhousie University. The new money doubles the fund to $100 million.
In total, she said there was an additional $198 million in spending by 14 government departments.
Another notable new cost was $40 million for the now-closed Northern Pulp effluent treatment lagoons near the Pictou Landing First Nation. Officials estimated the cleanup of Boat Harbour, which has yet to begin, will cost $291.9 million.
The new spending was partially offset by revenues that were up $454.1 million from the 2019 budget, primarily because the province collected more in taxes and in federal transfer payments.
At year end, the net debt was $15.2 billion, while the net-debt-to-GDP ratio for fiscal 2019-20 was 33.1 per cent.
Casey said a stronger economy over the last two years enabled the Liberal government to balance its books for the fourth consecutive year – although just barely.
READ MORE: N.S. Liberal budget opens up spending taps as province faces slowing economy
That track record is definitely in peril after the province said in late July it would end fiscal 2020-21 with a projected $853-million deficit, because of costs associated with the pandemic and the resulting economic downturn.
“Our province was strong coming into this pandemic and we will continue to focus on the health and well-being of Nova Scotians,” Casey said. “And we will continue to apply the same principles of good fiscal management as we move through the recovery phase in the months ahead.”
This report by The Canadian Press was first published Aug. 20, 2020.