The Saskatchewan Party announced their fourth budget Wednesday in Regina. Finance Minister Ken Krawetz delivered what he’s calling “a balanced budget.” Residents of Saskatchewan may be about to get an advantage, but the opposition feels the balanced budget doesn't have the ordinary person in mind.
“Saskatchewan is blessed with many advantages as we open the 2011-12 fiscal year,” said Krawetz. “We are expected to lead the country in economic growth, our population continues to grow and our employment picture remains bright.”
Called the ‘Saskatchewan Advantage’, the budget focuses on lowering taxes, improving services, and lessening debt. In his address to the media, Minister Krawetz highlighted Saskatchewan’s economic strength compared to the rest of the country.
“While other provinces are recording deficits, we will post a surplus,” said Krawetz. “While others will struggle to maintain programs, we will improve our public services. While others see their debt load increase, we will reduce our debt. This budget will continue to strengthen our economy and make life more affordable by reducing taxes.”
With a focus on improving the quality of life for people living in the province, the government is touting that they are making life more affordable for individuals and families by leaving them with more money through lower income taxes.
“Small business and individuals are receiving tax breaks with this budget. Families of four earning $50,000 combined income will save $2,447 in income taxes this year,” said Krawetz. “It also means another 22,000 people coming off the tax rolls. In four years, we have eliminated provincial income tax from 114,000 Saskatchewan people.”
Despite what is once again being called a balanced budget, government spending is up 5.5 per cent to $10.67 billion this year. Revenue is forecasted to be $10.79 billion, which is up 8.5 per cent from last year’s budget, however.
Saskatchewan’s overall debt is being decreased by just over $149 million, leaving the province's net debt at $3.81 billion, the lowest level since 1987-88. Last year, in order to balance to books the government used finances from the Growth and Financial Security Fund. This year they are reducing the debt by $325 million leaving the “rainy day fund” at $710 million.
“That’s a reduction of $3 billion, or 44 percent, since our government took office,” Krawetz said. “Debt reduction is not just a lofty accounting principle. It means lower interest costs and more money to pay for important government services in Saskatchewan."
But the opposition government says the budget has failed the people of Saskatchewan. NDP opposition critic for Finance Trent Wotherspoon wonders who is actually getting the advantage.
“We didn’t see the kind of broad-based relief we would like to see at a time of so-called prosperity being touted by this government, “ said Wotherspoon. “We see more revenue from this government but we just simply don’t see it being connected to the well-being of Saskatchewan people.”
Other highlights include:
For post-secondary students tuition will likely increase three per cent. The government is emphasizing efforts to combat tuition increases by spending $24.6 million through Advanced Education to hold tuition increases to an average of three per cent.
$556.2 million is being spent on the Highway's budget, $285 million of which will be spent on repaving.
$250 million increase to Regional Health Authority base funding for compensation, drugs and medical supplies, and operating costs.
$216.8 million in revenue sharing to meet the government’s commitment to fully implement the new municipal revenue sharing agreement equal to one full point of PST.
Non-renewable resources are a volatile issue because assumptions are constantly subject to change. Oil assumptions are US$93.75 per barrel despite the price currently sitting at over $100 per barrel.
Unlike the $1.7 billion overestimate on potash revenues from the 2009-10 budget, the government is playing it safe with potash, predicting an increase of $80 million (Over $381 million total revenue) in potash.
Potash is estimated to bring in $381.3 million in 2011-12, which is an increase of about $160 million from the 2010-11 estimates.
Government is increasing the beer discount it provides to off-sale retailers. Effective April 1st the discount will increase by approximately 62 per cent which means up to $2.43 cents saving per dozen.
Above: Media gathers for reaction from Saskatchewan MLAs as the budget is released.
Photo by Deborah Shawcross