On Thursday, July 29th, Finance Minister Graham Steele announced that the province’s deficit should be much less than the anticipated $488 million that was forecasted back in April of this year.
In fact, if all goes according to plan, the deficit should be a whole lot less. A decrease of about two hundred and forty-six million dollars from the previous projection is certainly more than just a drop in the bucket!
So, what’s the most important reason for this significant deficit decline? Well, a stroke of reasonably good luck, for starters. The stronger-than-expected Canadian economy, combined with some big savings coming from the Health sector due to lower-than-expected doctors’ billings and other savings, made up a fair piece of the savings pie. But more importantly, it appears as though the budgetary savings that have been accrued from some departmental belt tightening have been handled as just that – savings – and were thus not immediately redirected elsewhere. Rather, they were set aside for one reason and one reason only – to reduce our alarming deficit.
Minister Steele said the public accounts show substantial progress in getting the province’s finances back in shape. And you know what? He’s right. It is very encouraging to see that we are making progress on this front, and that all savings so far have been directed towards combating the deficit. If the economy continues to exceed expectations, we may well see a balanced budget in 2013 after all.
This is an admirable example of fiscal responsibility in what was otherwise a tremendously stressful year filled with no small degree of controversy for the NDP government and other Members of the Legislative Assembly. But MLA spending scandals aside, this is a clear indication that the government is ultimately taking some appropriate steps to get us out of the red and back in the black, and for that we must give praise where praise is due.
The Chamber was certainly pleased to learn of this recent announcement. We have indicated in our provincial budget response that we strongly support the NDP’s goal of achieving a balanced budget by 2013/14. The Chamber congratulates Minister Steele for working with his government to put the initial yet difficult foundation in place for Nova Scotia to achieve this goal.
But don’t whip out the champagne just yet.
Despite this rather encouraging news, a glaring problem remains – our revised provincial deficit is now pegged at $242 million, still rather large by all accounts. And with an additional $300 million in revenues over the next year expected from the recently-imposed HST hike alone ($60 million more than our entire current deficit), many Nova Scotians are undoubtedly left wondering just where, exactly, this extra revenue will be utilized?
At any rate, it appears as though a penny saved will indeed remain saved in Nova Scotia, at least for the time being. Now we can only hope that Minister Steele will require a larger piggybank!