New Brunswick

Higgs keeps lid on infrastructure spending, despite chance of election

Despite the possibility of an early election, the Higgs government is keeping a lid on infrastructure spending in the coming year.

Minority PC government to spend $599M on infrastructure, slightly less than this year

Finance Minister Ernie Steeves delivered his second capital budget in the legislature on Tuesday. (CBC)

Despite the possibility of an early election, the Higgs government is keeping a lid on infrastructure spending in the coming year.

The Progressive Conservatives' second capital budget tabled in the legislature Tuesday holds the line on major spending projects, dialling back the total dollar amount to a shade below what the government spent this year.

The Tories will spend $599.2 million, down from the $600.6 million they budgeted last year.

That's consistent with the five-year plan the PCs released a year ago, which projected fractionally less spending on infrastructure every year through 2023-24.

More details expected Wednesday

Finance Minister Ernie Steeves told the legislature that last year's capital budget, which eliminated more than $200 million in projects planned by the previous Liberal government, led to the first reduction in the province's net debt in more than a decade.

"This year's capital budget builds upon that progress and keeps our forward momentum going," he said.

"We are showing continued fiscal discipline, we are being transparent, and we are managing within the budget we have set."

Blaine Higgs's minority government depends on support from the three People's Alliance MLAs, but their pledge to prop up the PCs expires in the spring. Two byelections must be called in the coming months. 

Steeves's speech did not contain any details of projects that are being approved or cancelled in the coming year, only total amounts for individual government departments:

  • In health care, the province will spend $123.9 million, almost exactly the same amount budgeted for this year. Only $16 million of that is to start new projects.
  • In education, the budget has $70.6 million for school infrastructure, an increase from $60.2 million in the first PC capital budget.
  • Roads, bridges and highways will see $279.3 million in 2020-21, a reduction from $321.1 million in 2019-20.

Details on individual projects in those three departments are expected as early as Wednesday.

Dieppe Liberal MLA Roger Melanson applauded the government for sticking with a five-year plan because it's more predictable.

But he said he was concerned that some necessary projects may not go ahead, especially upgrades to existing, deteriorating infrastructure.

Prevention, and investing to maintain infrastructure, is important, and this government doesn't seem to get that.- Roger Melanson, Dieppe Liberal MLA

"You're going to have to invest when the situation with that infrastructure is in worse shape," he said.

"Prevention, and investing to maintain infrastructure, is important, and this government doesn't seem to get that."

Green Party Leader David Coon said the fact the Department of Social Development's capital budget remains at $12 million suggests the province won't be spending new money on social housing, despite an agreement with Ottawa.

Bridge upgrade in deputy premier's riding

The only specific project announced Tuesday was $1 million to begin work upgrading a major bridge between Shippagan and Lameque, in the riding of deputy premier Robert Gauvin.

Asked why that project was getting special mention on Tuesday, Gauvin said, "Maybe I'm special."

Last year's first PC capital budget slashed infrastructure spending to about one-third less than what the Brian Gallant Liberals had planned before the 2018 election.

It cancelled several major projects, including a new Centennial Building and courtroom complex in Fredericton, a new New Brunswick Museum in Saint John, Route 11 upgrades, and planning for a school in west end Moncton to replace Bessborough and Hillcrest schools.

In September, CBC News reported the cancellation of the Centennial Building project wiped out $2.5 million a year in potential savings for taxpayers.

An internal government study from 2015 proposed the province save money by refurbishing the structure and moving some government departments from rented offices into the building, part of a broader plan to centralize office space and save $4 million a year.

Avoided credit downgrade

But the government responded that cancelling the project and several others removed more than $200 million from the province's books, helping reduce long-term debt.

That in turn helped avoid a credit downgrade by bond rating agencies, which might have led to higher interest costs on borrowing money.

In May, the government issued a request for proposals for private-sector redevelopment of the property, with "no inclusion of public money or risk to provincial taxpayers" part of the criteria.

Last year's capital budget also delayed a new coronary care unit for the Moncton Hospital that was one goal of an $8 million fundraising campaign in the city.

In February, the Friends of the Moncton Hospital persuaded city hall to donate $500,000 to the campaign and told councillors that it was the group's understanding the delay would only last a year.

One of the few new projects announced on last year's list was a new school for Hanwell, in the riding represented by Education Minister Dominic Cardy.

On Tuesday, Cardy announced a new "assessment process" to evaluate infrastructure funding requests for schools.

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