Actually for a right wing government the Wall regime shows some good sense and seems to have learned from Alberta's problems. Investing in infrastructure was no doubt overdue and certainly is necessary to prepare for increased population. All the NDP can do is make cracks about finally recognising the usefulness of the rainy day fund and clamoring for bigger tax breaks! I guess the NDP wants to stay out of power for a while or is it intending to remake itself as a new party the NCP the New Conservative Party.
Saskatchewan budget uses boom cash to patch potholes, expand hospitals, schools
2 days ago
REGINA — The Saskatchewan government is using the province's unbridled economic prosperity to patch potholes, improve hospitals and expand schools in hopes of avoiding some of the troubles of its booming neighbour.
The Saskatchewan Party's first budget since taking power last fall focuses on bricks, mortar and blacktop rather than putting more money in people's pockets or making large payments on the debt. It brings only modest tax relief for homeowners, although it does offer tuition rebates to recent graduates.
Finance Minister Rob Gantefoer said he looked to Alberta's experience with its energy-fuelled boom and decided Saskatchewan should not follow the same path of rapid and massive debt reduction at the expense of infrastructure.
"We certainly looked to Alberta for some advice. I mean, they have had the experience of a very robust economy much sooner than we have," he told reporters shortly before tabling the budget in the legislature Wednesday.
"We were told, pretty much unanimously at all levels, don't forget about infrastructure, because you can see in the economy in Alberta that they are really behind the eight ball in many instances, and it's costing them a tremendous price to catch up."
Alberta's Conservative government, which spent years slashing the provincial debt, is now facing skyrocketing costs as it tries to repair and improve long-neglected infrastructure.
The centrepiece of Gantefoer's budget is a $1-billion "Ready for Growth" initiative for capital and infrastructure investment. When the numbers are broken down, however, the government is actually investing about $400 million more in infrastructure than it did last year.
Of that extra money, half will go to schools and hospitals while the other half will go to enhancing and fixing the province's highways. The government notes, however, that most of the $200 million going to highway capital isn't likely to be spent this year because of questions about how much work can actually get done.
The money for schools and hospitals will go to improving and expanding existing facilities rather than building entirely new projects.
"Saskatchewan must be ready for growth," Gantefoer said. "Simply put, Saskatchewan is ready for growth. Our infrastructure is not."
Overall in this budget, government revenue is up 19 per cent over last year to $9.37 billion. Spending is also up by a total of 10 per cent to $8.57 billion, plus another $535 million to service the debt.
The government will take the $260-million surplus and put $250 million to the provincial debt and $10 million to the province's rainy-day fund, which currently has a balance of $1.3 billion. The $10.7-billion provincial debt is actually estimated to rise marginally, but that is because of capital spending at some of the province's Crown-owned utilities.
The major tax relief items were modest and in line with what the small-c conservative Saskatchewan Party promised in the November election.
The government is increasing the rebate homeowners see on the education portion of their property tax bills to 12 per cent from 10 per cent, saving the average homeowner an extra $27 a year. The rebate on agriculture land is being increased to 47 per cent from the current 38 per cent, saving the average farmer an extra $477 annually.
The government is also following through on an election commitment to offer graduating students up to $20,000 in tuition rebates if they stay in the province seven years after graduation. That is expected to cost $12 million this year.
The small movement on taxes left the left-leaning Opposition NDP in the atypical position of calling for more tax relief.
"This is a government that is sitting on $1.3 billion in the fiscal stabilization fund but refuses to do more in terms of property tax relief for homeowners in Saskatchewan," said finance critic Harry Van Mulligen.
"I believe the budget proposes an additional $22 in tax relief - the price of a haircut for property taxpayers. We believe they have the resources to do a lot more."
Van Mulligen also took the opportunity to crow about the way the government has put the budget together.
While in opposition, the Saskatchewan Party used to criticize the NDP for using the province's rainy-day fund to hide what were in fact deficit budgets. The Saskatchewan Party actually campaigned on eliminating the fund, but backed away from that once in government.
While this year's budget does not use rainy-day money to balance the books, the Saskatchewan Party's four-year plan forecasts spending to outpace revenue, meaning the fund will have to be drawn down.
Still the budget documents laud the fact that the government has balanced its books 15 years in a row.
"I guess imitation is the sincerest form of flattery, so I thank them very much for finally recognizing that all those NDP budgets were balanced budgets," Van Mulligen said.
Highlights of the 2008-09 Saskatchewan budget tabled Wednesday:
-Revenue up 19 per cent to $9.37 billion.
-Spending up by 10 per cent to $8.57 billion, plus another $535 million to service the debt.
-$250 million of surplus being put toward debt.
-$400 million in extra capital investment this year to be split between highways, school and hospitals.
-Rebate homeowners get on education portion of property tax bills increased to 12 per cent from 10 per cent, saving the average homeowner an extra $27 a year.
-Property tax rebate on agriculture land increased to 47 per cent from 38 per cent, saving the average farmer and extra $477 annually.
-Graduating students offered $20,000 in tuition rebates if they stay in the province seven years after graduation.
-$10.5 million for 120 new nurse training seats.
-$6.1 million for 16 new medical school seats.
-$3 million for 30 new police officers