New Brunswick’s Liberal government is now projecting a nearly $399-million deficit this fiscal year, according to the third-quarter results.
That is compared to a projected $92-million deficit just three months ago and a $41-million surplus budgeted by the previous Progressive Conservative government.
Finance Minister René Legacy said there are several factors that negatively influenced the most recent quarter
“We know there are difficult decisions ahead, considering the results we have seen over the last two quarters,” Legacy said in a news release.
“We remain committed to being fiscally responsible and are determined to help New Brunswickers navigate the very real struggle they face during these challenging financial times.”
Expenses $409M over budget
Total expenses this fiscal year now are projected to be over budget by more than $409 million.
Legacy said the most significant factors included higher costs in the regional health authorities, with a big portion attributed to travel nurses.
“We just heard it’s about $100 million dollars over, that’s not the full contract,” the finance minsiter told reporters.
“That is dollars that New Brunswickers are sending to companies from outside New Brunswick that isn’t making our health system stronger, that isn’t investing in our staffing, it’s just going away.”
Officials said there also increased demand for services in income security and more complex cases in child welfare and youth services.
The government also cited its commitments on nurse retention payments and the electricity rebate as reasons for the extra expenses.
Revenue also down slightly
Meanwhile, total revenue is projected to be $30 million lower than budget, which is due in part to the federal GST/HST break.
That tax break is expected to cost New Brunswick about $70 million in revenue, something Legacy said they are still trying to get back from the federal government.
The minister said it will be challenging to balance the budget this year — and is unlikely to happen next year either — but the government is trying to lower the deficit figure as much as possible.
“After Q2, we asked people to be cognizant of where we were headed. We’ve asked different departments to maybe re-look at some of the spending initiatives they were gonna do,” said Legacy.
Opposition Progressive Conservatives respond
The Opposition Progressive Conservatives said they are “deeply concerned” by the latest fiscal update from the Liberal government.
“Liberal governments have a history of mortgaging the future of New Brunswickers, saddling families, businesses, and future generations with unsustainable debt,” Finance Critic Don Monahan said in a statement.
“With a staggering deficit and no clear plan to balance the budget, it looks as though the Holt Liberal government will follow the same path.”
Monahan adds the fiscal update leaves New Brunswickers with three questions: what programs will be cut, what promises will be broken, and what taxes will be raised.
