Released on August 1, 2002
Saskatchewan remains on target for its ninth consecutive balanced budget.The 2002-03 First Quarter Report reveals a projected surplus of $100,000
for 2002-03; basically unchanged from the $45,000 surplus projected in the
March budget.
Finance Minister Eric Cline released the first-ever First Quarter Report
this morning.
"We believe in open, accountable financial management," Cline said. "A Mid-
Year Report was introduced in 1992 to keep people better informed on their
province's financial situation. Earlier this year we built on this
commitment by introducing a Third Quarter Report. Today's release of the
First Quarter Report is another first. It is the latest step in improving
on our commitment to regular, reliable financial reporting."
The First Quarter Report covers the period April 1 - June 30, 2002. It
shows a projected $57 million increase in operating spending, a $24.3
million reduction in revenue, no change in interest costs, and an $81.4
million increase in the transfer from the Fiscal Stabilization Fund. Key
factors behind the $57.0 million increase in spending over the March budget
forecast are the recently announced drought assistance package for
livestock producers, much higher than average forest fire costs, and an
increase in prescription drug costs.
Dry weather continues to take its toll across the province. The drought
has caused major problems for livestock producers and the goal of the aid
package is to help qualifying producers retain their breeding stock. In
northern Saskatchewan, dry weather has contributed to 799 forest fires as
of July 22, an increase of 38 per cent over the same period last year.
Drug costs are on the increase due to increased use of prescription
medications and the use of new and more expensive products.
The strength in oil and gas in the last quarter of 2001-02 carried through
to the first quarter this year with revenues exceeding budget projections.
However, that increase was offset by a $189 million decrease in
equalization transfers from the federal government. Revenue from all
sources was down $24.3 million from the budget forecast.
To make up for the changes in revenue and spending, the transfer from the
Fiscal Stabilization Fund has been increased by $81.4 million - from $225
million to $306.4 million. Owing to a reduction in actual expenditures and
an increase in actual revenues, compared to projections for 2001-02, $131
million less was drawn down from the Fiscal Stabilization Fund last year.
"This will leave a projected balance of $188.6 million in the Fiscal
Stabilization Fund," Cline said. "The fund continues to serve its intended
purpose of stabilizing revenue from one year to the next. This in turn
allows more stability in the delivery of public services. Prudent
Saskatchewan governments have relied on 'rainy day funds' since the Dunning
administration in 1925. It just makes sense."
More on the First Quarter Report can be found at www.gov.sk.ca/finance.
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For more information, contact:
Roy Schneider
Saskatchewan Finance
Regina
Phone: (306) 787-8109