MID-YEAR REPORT SHOWS ECONOMIC GROWTH, FISCAL PLAN ON TRACK

Released on November 21, 1996

Saskatchewan's economy is growing, its fiscal position is improving and
its debt reduction plans are resulting in benefits to Saskatchewan
people, said Finance Minister Janice MacKinnon, who today released the
province's 1996-97 Mid-Year Financial Report.

The report also confirms that most of the new monies from economic
growth are replacing federal reductions to equalization payments and
federal cuts to areas such as health.

"Saskatchewan's broad-based economic growth continues," MacKinnon said.
"The growth in retail sales is higher than the national average and
higher than Alberta's. New vehicle purchases are rising, the oil and
uranium industry are growing, and manufacturing continues to gain
momentum. Despite problems with weather, this year's crop will still
be above the 10-year average."

But MacKinnon noted that because Saskatchewan's economy is growing more
rapidly than others, the province will receive $229 million less than
expected in federal equalization payments.

"Saskatchewan is climbing up the economic ladder, and we're closer to
becoming a have province, which is good news. But the drop in
equalization payments means the province's growth in total revenues has
been modest, not major."

The rest of the fiscal room created by economic growth was taken up by
the government's additional $40 million investment in health this past
August.

"Saskatchewan people can see the tangible benefits of our growing
financial freedom. As well as replacing 100 per cent of the federal
cuts to health, social programs and operating funding for
post-secondary education in the budget, we were able to make an
additional investment in the priority area of health care."

Similarly, the province's debt reduction plans are also bringing
benefits to people, the minister said.

"As our debt is reduced and interest payments decline, there will be
more room for future tax reductions and program improvements."

MacKinnon noted the report showed the province had cut total debt by
$327 million more than expected, reflecting an overall debt reduction
of $1.8 billion since 1994.

A major part of the debt reduction plan was the elimination of about
$150 million of crop insurance debt, which the minister said farm
groups had been requesting for some time.

"This is a win-win situation. Farmers will benefit from a crop
insurance program that is more affordable. The province and taxpayers
will benefit by making crop insurance more sustainable.

"We are also urging the federal government to follow suit and pay down
its share of the crop insurance debt so that there can be even greater
benefits to farmers and taxpayers," MacKinnon said.

Saskatchewan continues to be among the leaders in Canada in reducing
its debt burden.

"We're paying down the mortgage on our children's future, we're paying
it down ahead of schedule, and we're now starting to receive the
benefits.

"With our economy growing, our population increasing, our financial
position improving and our debt declining, Saskatchewan people can look
to the future with a greater sense of security and confidence,"
MacKinnon said.

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For more information, contact:

Ron Podbielski
Director of Communications
Finance
Regina
Phone: (306) 787-6578