Deficit forecast still on track for $231M, says finance minister
Government's contingency fund of $100M to be eliminated, says Cathy Rogers
New Brunswick still expects to post a deficit of $231 million this year, according to third-quarter results released Friday by Finance Minister Cathy Rogers.
The number is $16 million below original budget estimates but nearly identical to the second quarter update in November.
Liberals are on track to have cut the province's deficit by $130 million in their first two budgets — about 36 per cent — although Rogers is taking credit for more than that.
"We are proud we have cut the deficit in half since taking office and we are on track to eliminating it entirely by the 2020-21 budget," she said.
According to New Brunswick's audited financial statements, the last budget of the former Alward government ended with a deficit of $361.4 million. The Liberals' first budget reduced that by $101 million and the current budget is projected to bring it down by a further $29 million.
Budget coming Tuesday
Rogers is set to deliver the Gallant government's third budget on Tuesday when the legislature resumes sitting.
The Gallant government's plan to take four more budgets to eliminate the rest of the deficit — two years longer than it proposed in the 2014 election — drew criticism Friday from the Atlantic Provinces Chamber of Commerce.
"It is critical that the government accelerate its plan to balance the provincial budget," the chamber said in a release.
"The public debt continues to increase and the debt service burden threatens to limit funding of required government services."
'Contingency fund' eliminated
Rogers also announced the province will be eliminating its controversial "contingency fund."
Auditor General Kim MacPherson heavily criticized the $150-million budget item — later reduced to $100 million — as a gimmick that did not meet professional accounting standards and disguised the true size of the deficit.
Rogers said only that government budgeting has been so accurate it was no longer necessary.
"Our targets are realistic and we are meeting or exceeding them." said Rogers.
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"It is for these reasons that we will not be requiring a contingency reserve going forward."
The financial update actually showed a number of departments are over budget, including Health (over by $21 million) and Regional Development ($22 million), but other departments were under-spending enough to make up for that.
"We do realize there is still a lot of work to do to get our fiscal house in order but I do want to assure you that we are headed in the right direction," said Rogers.