New Brunswick

New Brunswick debt grows to $13.8B

New Brunswick continued to slip further into debt last year but the red ink was flowing at the slowest pace recorded in 10 years.

Audited financial statements show $167.4M increase in debt last year from year before

Finance Minister Cathy Rogers says the government continues to focus on bringing down the deficit, while spending on health care and education. (Pat Richard/CBC)

New Brunswick continued to slip further into debt last year, but the red ink was flowing at the slowest pace recorded in 10 years.

According to the province's audited financial statements released on Thursday, the provincial debt grew to $13.8 billion as of March 31, 2017.

We have a fiscal plan in place, and that plan is working.- Cathy Rogers, finance minister

That's $167.4 million more than one year earlier, an enormous improvement over the single-year billion-dollar leaps the debt took in prior years such as 2011 and 2013.

"Government is committed to responsible fiscal management and returning to fiscal balance," Finance Minister Cathy Rogers said in a statement.

"We have a fiscal plan in place, and that plan is working."

The province's finances have been improving, mostly due to a surge in revenue. Last year the Gallant government raised a number of taxes, including an increase in the provincial portion of the HST.

That, and increased transfers from Ottawa, helped boost revenues six per cent, or by $504 million, for the year, which was enough to overcome a 4.2 per cent increase in spending.

Over the last three years provincial revenues have grown by $1.12 billion, with $635 million of that funnelled into new spending and $482 million used to reduce the deficit.

Final Tory budget cut deficit by $239M

Rogers said she was "proud" the Gallant government has managed to reduce the deficit by $242.5 million over its first two budgets although New Brunswick's deficit has actually fallen for three straight years now.

The final budget of former finance minister Blaine Higgs, now the Progressive Conservative Opposition leader, cut the deficit by $239 million, although that went unmentioned.

"Your government is proud to have reduced the deficit by 67 per cent since fiscal 2014-15," she said.

Rapid growth in New Brunswick's debt over the last decade has been consistently cited as a major concern by Auditor General Kim MacPherson.

Huge budget deficits beginning in 2008 added an average of $700 million per year to the debt total in a 10-year period — $7 billion in total.

Last fall, MacPherson called that "a very disturbing trend" and warned government needed to act.

The addition of $167.4 million in new debt in the latest year is the smallest increase recorded since the final budget year of the Bernard Lord government in 2006-2007, when the debt shrunk by $139 million.

ABOUT THE AUTHOR

Robert Jones

Reporter

Robert Jones has been a reporter and producer with CBC New Brunswick since 1990. His investigative reports on petroleum pricing in New Brunswick won several regional and national awards and led to the adoption of price regulation in 2006.

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