Released on November 12, 1998
Finance Minister Eric Cline today released the 1998-99 Mid-YearFinancial Report, showing the Government is on target to deliver its
fifth consecutive balanced budget.
"This report demonstrates the ongoing benefits of sound financial
management, as well as its relationship to economic growth and quality
of life," Cline said. "With our fiscal house in order, we have been
able to deal with the economic uncertainties of recent months. We are
making solid progress on our plan to lower taxes, pay down debt and
invest in the services that matter most to people -- all within a
balanced budget framework."
Mid-Year Financial Reports were introduced in 1991 to provide interim
financial and economic information to the public. The 1998-99 Report
projects a surplus of $105.5 million to fiscal year end, virtually
unchanged from the March budget forecast. Debt repayment is slightly
ahead of schedule.
Revenue from provincial sources is on target with the budget
projections, reflecting stability in the provincial economy. Higher
estimations of Saskatchewan's population are expected to contribute to
an increase of $118 million in federal transfer payments, primarily
Equalization, to the Province over the budget forecast. About
one-half of this improvement is due to re-calculations of prior years'
entitlements caused by revised population estimates.
The Report reflects increased spending for priority services such
as health and highways. "We have made a commitment to invest in
peoples' priorities as it becomes affordable," Cline said. "This
year we responded to needs in the health system by providing an
additional $41 million over and above the budgeted amount, to
cover costs such as the hiring of additional front line health
workers, Saskatchewan's contribution to the new Canadian Blood
Services agency and increased utilization of the health system.
"We also increased funding for highways, allowing improvements to
an additional 168 kilometres of highway and 165 kilometres of
gravel roads. And, a number of other departments were provided
with increases to cover unusual or one-time needs."
Cline noted that one of the biggest challenges in 1998 has been
the intense forest fire season, which boosted fire suppression
expenditures by $62 million. "We budget for forest fire
suppression on a five-year average and clearly this was an
unusual year," Cline said. "Fortunately, we have been able to
meet this challenge by drawing on the retained earnings of the
Saskatchewan Liquor and Gaming Authority. It is this kind of
occurrence which underscores the importance of maintaining a
contingency reserve."
On the economic side, Cline noted that there are some areas of
concern, particularly in the agriculture and oil sectors.
Overall, however, the most recent available figures show
Saskatchewan's economy continuing to perform well. Compared to
1997:
employment was up 4,900, January - October, with 8,500
more full-time jobs;
natural gas drilling was up more than 200 per cent,
January to May;
potash sales rose nearly 18 per cent, January - June;
wholesale trade increased nearly 12 per cent, January
to July; and,
housing starts were up 16 per cent, January to
September.
Cline said that the government remains committed to reaching its
financial and economic targets now and in the future. "It won't
be easy and there are still many challenges on the horizon," he
said. "For example, Saskatchewan is still grappling with federal
cuts to social spending of about $200 million a year. I would
hope that the federal government will begin to substantially
re-invest in the critical services Canadians rely on, especially
our health system."
Cline said that the Mid-Year Financial Report provides strong
evidence of the province's commitment to investing in services,
lowering debt and reducing taxes as it becomes affordable.
"This balanced approach to financial management has resulted in
greater flexibility to meet the changing needs of families and
communities.
"Above all, the Report shows that we have done what we said we
would do. We will not jeopardize our progress by introducing
measures guaranteed to lead the province back to the days of
deficits and debt. Our commitment remains with the people of
Saskatchewan and with ensuring that they can enjoy what they have
earned: the growing freedom to build a secure and prosperous
future."
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For more information, contact:
Sandra Lodoen
Saskatchewan Finance
Regina
Phone: (306)787-6578