The budget announcement earlier this week outlined one of the toughest budgets this province has seen in a decade, including hundreds of lost jobs and hundreds of millions of dollars in cuts.
Projections in January estimated a deficit of approximately $1.6 billion, but by late March that number had been brought down to $563.8 million.
Many people were left scratching their heads at such a large drop, but Finance Minister Jerome Kennedy said the original estimation was accurate with the numbers government was working with at the time.
Kennedy said he revisited estimations with the Canada-Newfoundland and Labrador Offshore Petroleum Board, which showed an additional one million barrels of oil from the Terra Nova field.
"In terms of our final deficit reduction numbers, we didn't know those until within 24 to 48 hours of the budget being delivered," he said.
"We were still working on the oil production numbers to make sure we had those right, and the Vale deal, obviously I couldn't say anything about, even though we had it built in our numbers."
Kennedy said government made the estimation announcement in order to prepare the people of the province for austerity measures.
"We were trying to be open and transparent, but what I'm learning about politics is you can't win," Kennedy said.
"Whatever we say, people will find fault with it."
Job loss 'traumatic' for many
There have been 935 layoffs in the budget announcement, as well as hundreds of other jobs eliminated through attrition and retirement.
Kennedy said the job cuts have been a necessary, albeit unpleasant, task.
"This is traumatic on a lot of people. Unfortunately, we're in a situation where we had spent a lot of money over the last number of years to rebuild the province, and then we reached a point where we were spending too much money," Kennedy said.
"Ever how we got there, we're there, and we had to do something about it, because if we don't then, essentially, the province's debt will just cause significant financial crisis."
Union bargaining still to come
Leaders of both the Newfoundland and Labrador Association of Public and Private Employees and the Canadian Union of Public Employees are not pleased with the fallout of the budget announcement, and it is unclear how this may affect upcoming talks surrounding the collective bargaining agreements.
"I've indicated [to the unions] from the beginning that this is a rather stark process at this point," Kennedy said.
"The unfunded pension liability has to be dealt with. The auditor general indicated that 65 per cent of our debt is coming from that unfunded pension liability and post-retirement benefits, even though we've put almost $4-billion in it in the last five or six years."
Kennedy said he hopes negotiations will not prove too volatile.
"I'm certainly hopeful that we'll reach an agreement — I certainly don't have an appetite for a strike," he said. "However, we'll outline our position and see where it lands."