Saskatchewan

Rising government debt worries Sask. Opposition

The Opposition says the provincial government is already adding to its debt and looks to be poised to add even more in the next few years.

Finance ministry gets approval to borrow up to $6 billion

Saskatchewan's finance minister, Kevin Doherty, plans to borrow at least $2 billion during this fiscal year.

The Opposition says the provincial government is already adding to its debt and looks to be poised to add even more in the next few years.

The government recently approved the finance ministry to borrow up to $6 billion over three years, although it is not obligated to borrow the entire amount. 

"This is a record expansion of their borrowing envelope, the likes of which has never been seen before," said the Opposition's finance critic Cathy Sproule to reporters at the legislature on Thursday.

"This is a government that's planning to spend a lot of money."

Opposition finance critic Cathy Sproule says the government is adding billions to the provincial debt. (Craig Edwards/CBC)

Finance Minister Kevin Doherty said in addition to the planned borrowing of $2 billion during this financial year, he may need to borrow more. 

"When you've had a drop of $1.2 billion in resource revenues over the last 18 months, you can't just shut down hospitals, or shut down schools," Doherty told reporters.

Doherty says most of the borrowed money will go to capital projects.

"We have record-low interest rates, with a AAA credit rating, good standing in the investment community, and an aggressive infrastructure capital builds program over the next four years that we need to finance," Doherty said. 

However, the finance minister does not rule out borrowing for day-to-day operating expenses, as the government did with $300 million last year.

Doherty agrees that is not sustainable and will need to change in future budgets.

"This government's going to make some difficult decisions in this fiscal year and ensuing fiscal years to get us back to a sustainable level," Doherty said.

Government of Saskatchewan budget 2016-2017

The government of Saskatchewan's budget document for 2016-2017 shows debt set to rise to nearly $16B by 2020. (Government of Saskatchewan )

now