Mother Nature mostly responsible for reduced Saskatchewan budget deficit last year

Surprise, surprise. The Saskatchewan Government deficit last year came in less than half the amount planned in the March 2017 budget.

The deficit came in at $303 million, a whole $393 million less than the budget had suggested. Oddly, the provincial government didn’t pull out the stops and brag about good stewardship of finances.

If you wonder why, be satisfied knowing the reversal in revenues came from matters completely beyond the government’s control. And much of the reduction in expenses was out of the government’s hand, as well. Expenses in the year ended March 31, 2018 were $489 million lower than projected.

A government news release indicates the largest contribu- tor to reduced expense was lower than expected claims on crop insurance and farm safety net programs.

The financial statement lumps expenses on debt charges, transportation, agriculture, environment and natural resources and economic development into one figure: $2.5 billion. But that was down $454 million from the planned amount.

It is safe to say that Mother Nature saved the Saskatchewan deficit from being twice as large. Mother Nature plays a regular role in how much the Saskatchewan Government has to spend or rakes in in revenues.

Still the finances showed significant decrease in one area. Education expense was down $183 million. Community development, infrastructure, was $79 million less than projected. Social services spending was $14 million higher than planned. Health spending increased $40 million over budget to $5.67 billion.

On the revenue side the increase in provincial sales tax raked in just over $2 billion more cash. Utilities pulled in $588 million more, due to weather changes. Insurance revenues grew $380 million mostly from distribution of a surplus in the Workers’ Compensation Fund. A $5 a barrel boost in oil prices and higher production brought in an extra $85 million. Potash revenue was up $68 million.

A slow economy saw personal income tax revenues fall $327 million while corporate tax revenue fell $154 million.

Property tax took in an extra $60 million, mainly from the reassessment value increase.

Money from the federal government dropped $54 million more than planned, mostly because of a previous one time transfer of dams and less crop insurance need. Canada Health and Canada Social transfers put $1.63 billion in the province’s till.

Some interesting data:

• Federal transfers amounted to 17 per cent of revenue.

• Taxation made up 48 per cent of revenues

• Non-renewable resources, at 10.2 per cent of revenues, were 40 per cent in 2009 with higher oil and potash prices.

• Net provincial debt at almost 81 per cent of government revenue was only at 5.2 per cent in 2009.

• Debt rose from $3.52 billion in 2009 to $11.2 billion in 2018.

• Since 2009, Saskatchewan has run five deficit budgets, three at break even, and two at a surplus.

• Investment in government-owned infrastructure was $1.46 billion with $1.47 billion to meet the needs of government service organizations.

• Since 2009, investment in infrastructure has been $14.5 billion.

Ron Walter can be reached at ronjoy@sasktel.net