The Progressive Conservative government has slashed its capital budget significantly as it attempts to contain its burgeoning deficit.
Finance Minister Blaine Higgs unveiled a trimmed down $592.9-million capital budget on Tuesday, down from the $940.4 million spent by the former Liberal government in 2010-11.
Higgs had already warned government departments that budget cuts were looming as he tries to wrestle down the deficit, which he said could reach $1 billion next year.
"Capital spending has been a contributor to the fiscal challenges we face. Over the last two years, governments everywhere increased their spending to minimize the depths of the recession and stimulate economic activity," Higgs said.
"In New Brunswick, this resulted in capital spending well above historic levels as the province embarked on a two-year, $1.6-billion capital plan. This is not sustainable."
The finance minister estimates the current budget deficit will top $820 million.
Higgs said in his capital budget speech the $592-million capital budget will allow for the continuation of certain projects that are underway, required maintenance and a handful of new projects.
|N.B. 2011-12 capital budget|
|Agriculture, Fisheries, Aquaculture||$400,000||$400,000|
|Education||$1 million||$2.5 million|
|Health||$10 million||$15 million|
|Maritime Provinces Higher Education Comm.||$15 million||$7.5 million|
|Natural Resources||$2.5 million||$1.3 million|
|Regional Development Corp.||$29.9 million||$4.5 million|
|Social Development||$10.6 million||$4.7 million|
|Supply and Services||$403.6 million||$242.7 million|
|Tourism and Parks||$500,000||$500,000|
|Transportation||$466.3 million||$313.1 million|
|Total||$940.4 million||$592.9 million|
The finance minister said $300.2 million is being earmarked for ongoing projects.
While, $251.2 million is being directed to fund maintenance of existing infrastructure projects.
The remaining $41.5 million, or seven per cent of total capital investments, will be set aside for new projects that will start in 2011-2012.
The Department of Education will have $30 million to maintain and improve its facilities and another $55.9 million to continue with ongoing projects. As well, there is $12.4 million to start new projects.
Those projects will not be outlined until Education Minister Jody Carr releases his budgetary estimates.
Several government departments will see their capital budgets significantly cut back next year.
The Regional Development Corp. will see its budget cut to $4.5 million from $29.9 million in 2010-11.
The Department of Supply and Services, which issues the contracts for capital projects, will see its budget cut to $242.7 million from $403.6 million in 2010-11.
The Department of Transportation's capital budget is falling to $313.1 million from $466.3 million in 2010-11.
The Department of Social Development's capital budget is being reduced to $4.7 million from $10.6 million last year.
And the Maritime Provinces Higher Education Commission will receive $7.5 million to fund deferred maintenance costs, down from $15 million last year.