New Brunswick

Cathy Rogers says province on track for lowest deficit in 8 years

New Brunswick's deficit continues to improve and is on target to hit an eight-year low, according to a mid-year update from provincial Finance Minister Cathy Rogers.

Finance minister puts deficit figure at $231.6 million in current fiscal year

New Brunswick's deficit continues to improve and is on target to hit an eight-year low, according to a mid-year update from Finance Minister Cathy Rogers. 1:15

New Brunswick's deficit continues to improve and is on target to hit an eight-year low, according to a mid-year update from Finance Minister Cathy Rogers.

"Today's results are good news for New Brunswickers," said Rogers. "They show an improvement from the plan we outlined in our 2016/2017 budget."

Rogers says six months into the current fiscal year the deficit is now projected to settle at $231.6 million. That's $15.5 million better than the original budget projection announced by former finance minister Roger Melanson in February.

If it holds it will be the lowest deficit posted by New Brunswick since 2009. The province hasn't posted a surplus since 2008.

Rogers credited an improved economy for generating more government revenues than expected, pointing to increased consumer spending, better gross domestic product numbers and what she called nationally leading wage growth as factors generating the improvement.

"We're now leading the country in [wage] growth on a year-to-year basis," said Rogers 

The news was positive, although second quarter updates have a spotty record for accuracy in New Brunswick.

Last year the actual deficit was overestimated at the second quarter by $42.6 million. But it's also gone the other way.  In 2013 the deficit was underestimated at the half way point by $176.5 million.

Many departments do not update their original budget numbers making projections notoriously unreliable. In 2015, six departments claimed to be exactly on budget at the halfway point but none hit their targets by year end. Four eventually went over budget by a combined $34 million and two went under budget by $21 million, pushing the deficit off target.

Five departments claimed to be exactly on budget in Tuesday's update.

The Gallant government is not forecasting a balanced budget until 2020-21.

The province's net debt is expected to reach $14.1 billion by the end of the current fiscal year.