The leader of the New Democratic Party of Newfoundland and Labrador says the party is hoping not to shrink any further in next provincial election, which will be held sometime in 2015.

Lorraine Michael plans to focus on areas where support has traditionally been strong, and that's primarily in St. John's, where all three NDP MHAs hold seats.

The party enjoyed record support in the 2011 election, winning five of the 48 seats up for grabs in the provincial legislature.

But the party imploded late last year, with Dale Kirby (St. John's North) and Christopher Mitchelmore (The Straits-White Bay North) leaving the party and sitting as independents following a dispute over Michael's leadership.

Kirby and Mitchelmore joined the Liberal party in February.

'I knew we were going to have a long road ahead of us. I knew things were going to be tough and they have been.' - Lorraine Michael

It wasn't a great year for the party, and recent poll results have shown  support has continued to slide.

Michael said the caucus revolt hurt the party, and the affects are still being felt.

"I knew we were going to have a long road ahead of us. I knew things were going to be tough and they have been," she said. 

She said the trick will be to make sure party support doesn't shrink further.

"We know where we have strength, and I think maintaining that strength is going to be extremely important and doing that, to me, will be a sign of success," she said.

Michael is also confident she will retain her own seat in Signal Hill-Quidi Vidi, where she has won election three times.

Deficit is OK, says Michael

Meanwhile, Michael is warning the government not to cut programs in the spring budget.

The province is dealing with a projected deficit that has now soared to more than $900 million, due largely to five-year lows for the price of oil and the subsequent loss of revenues.

Michael said if the government needs more money, it should cancel tax cuts for businesses. 

She's OK with Finance Minister Ross Wiseman allowing the province to run a deficit.

"He cannot cut services, and the thing is a deficit is not the end of the world," she said.

"So if we have to carry a deficit for two or three years in order to make sure people have their services and people retain their jobs, then that's the way we have to go."

The finance minister and Premier Paul Davis have said all options are on the table as the 2015-16 provincial spring budget is being put together.