The provincial budget for 2016-17 reflects a new reality in the province, with a major drop in oil revenue leading to some big changes for the province, as well as a projected $434 million deficit. Yorkton MLA Greg Ottenbreit admits that they didn’t want to run a deficit this year, but they wanted to make a budget that would keep the economy of the province rolling.
The tight budget year is defined by a $958 million dollar shortfall in resource revenue, which Ottenbreit says is out of government hands but still something that they have to deal with. They also anticipate less consumer spending in the coming year, thanks to that cut of resource revenue affecting people. There are going to be no new taxes made to meet the shortfall.
“We’re basically dealing with a billion dollar shortfall that we have to make up for so I think being able to deliver a $434 million dollar deficit this year was not what we wanted to do, we would prefer not to, but I think shows some pretty prudent financial decisions without impacting people too heavily.”
The two big spends are health, with a budget increase, and infrastructure, especially highway construction, with $3.5 million in infrastructure spending. Ottenbreit says that while they’re not doing much in the way of new spending, the announced projects, such as highway upgrades, make sense in a tight economy. He argues that the projects can be cheaper in an economic downturn, but are also more necessary, given that they create jobs at a time when people need them.
“Not only does it drive the economy and create real, Saskatchewan jobs, but we need transportation infrastructure to move our products to market... We are still a strong, export based economy, with agriculture manufacturing, which means we have to get those products to market. Without a good highway system, a good transportation, we can’t do that.”
Nothing specific is coming to Yorkton, but Ottenbreit says that maintaining the revenue sharing with the PST should help the city continue to meet infrastructure needs, as well as looking closely at what the federal government is planning for their own infrastructure programming.
“We don’t want to leave that money on the table.”
Changing where money goes has been a change for health, with money being redirected with a focus on front-line staff, directing regions to find efficiencies in administration to make up for that. Another change, and one that has been controversial, is an increase of the seniors and childrens’ drug plan by $5 per prescription. The first increase in five years, Ottenbreit says that changing the program keeps it sustainable. He emphasizes that the drugs are highly subsidized, and there are other programs for people with very high prescription drug costs.
The big changes are coming in the path to next year’s budget. The buzzword this year was “transformational change,” which Ottenbreit explains is looking at what the government is doing and seeing if there is a more efficient way to handle it. Ottenbreit looks at the examples of health regions and school divisions, and whether or not the number currently in place make sense.
“Not presupposing anything, but getting some outside sources to look at how we’re operating, look at best practices, at other jurisdictions, and how we can deliver services better, serve people better and also find efficiencies and a more affordable system. If we look at how things are delivered now, and I can point to health, the NDP is calling for a six per cent or more increase instead of a 2.3 per cent increase that was allocated. If we keep increasing spending by that amount, it won’t be too long before health and education are our entire budget and there won’t be money for other things. We have to have a really good look at how government works.”
The government is planning to get back to a balanced budget next year. Ottenbreit says they’re hoping for a turnaround in the market, but are banking on the big changes they are planning over the next year will save enough money to make the next budget balanced again.
