If you had any questions about how the province is faring financially, they were answered this week.
The province announced that it finished the year with a surplus of $589 million, a gaudy $439 million higher than forecast in the 2013-2014 budget.
The good news came from a mix of higher revenues and lower expenses. Revenue hit $14.4 billion, $239 million higher than forecast, while expenses totalled $13.8 billion, $200 million lower than expected.
Finance Minister Ken Krawetz, who is apparently a master of understatement, summed it up.
“We know that revenue is up slightly and expenses were down, and if you have both of those things occurring, the result is that the province is doing well.”
It could have been even better without the collapse in the potash market after a Russian-based company left the export partnership. That was more than offset by the largest crop in Saskatchewan history.
Other money makers were insurance sector investment income and from taxes such as a four-cent increase on tobacco. Those four pennies were collected to the tune of $23 million.
There was also a massive $141-million injection to the bottom line with the sale of Information Services Corporation.
According to government documents released last Thursday, the province’s debt currently stands at $3.8 billion. The cost of servicing that debt in 2013 was $340 million per year.
It’s worth noting that Saskatchewan will be the only province not to run a deficit this year.
And it’s also worth checking out the creeping debt elsewhere; $38 billion in B.C., $16 billion in Manitoba, $252 billion in Ontario, $175 billion in Quebec, $11 billion in New Brunswick, $13 billion in Nova Scotia, $2 billion in P.E.I., $8 billion in Newfoundland/Labrador and $600 million in the Northwest Territories.
Only Yukon ($700,000) and Alberta ($12.1 billion) have money in the bank.
(These 2012-13 numbers come from Toronto Dominion’s government budget balance report released earlier this month.)
It’s obvious that Saskatchewan is headed in the right direction. And it’s heartening to see that the provincial government didn’t seize on the opportunity to start cutting cheques.
“Even though there is a $589-million surplus, it’s not cash to spend on things like building more highways or improving conditions in the various ministries, because these are insurance organizations that have brought about that massive amount of surplus,” Krawetz said.
“That surplus needs to remain there for the year when we will have a massive hail storm and the auto fund will need the dollars.”
The province delivered the 2014-2015 budget in March. It forecasts $14.07 billion in revenue and $14 billion in spending.
The forecast surplus is just $71 million, a tidy little sum if you win it but a thin margin in a growing province of more than a million people.
Let’s hope that with wise planning and some lucky breaks that we’re trumpeting another massive surplus next year.
Prince Albert Daily Herald