Will surplus change the polls?
A $75 million budget surplus mistake that nobody is going to be very concerned about
If there was ever any doubt that the Island’s economy is in good shape, it was eliminated on Wednesday with the premier’s announcement the government had a $75 million budget surplus this past fiscal year.
That is well above the $1.2 million surplus the budget had predicted, which doesn’t say much for government forecasting, but it’s a $75 million mistake that nobody is going to be very concerned about.
Given the size of the Island’s budget, a $75 million surplus is huge. It amounts to $500 for every man, woman and child on the Island. An equivalent surplus in Nova Scotia would be about $450 million, a federal surplus of the same magnitude would be more than $17 billion.
Even before the premier’s announcement, there were lots of indications that the Island economy is booming. Employers are finding it hard to get good workers. Almost anywhere on the Island anyone wanting to build a house is looking at a wait of a year or more, even longer in Charlottetown. If you want a new fishing boat you will be facing a wait of about three years, after you put down a substantial deposit. A positive aspect of this period of prosperity that differentiates it from other good times on the Island is the fact that it is so widely dispersed. It is not just in the larger communities, the city and towns, and, it is not just in one sector of the economy, the good times are being felt throughout the province.
Good catches and relatively good prices in the lobster industry have resulted in the Island’s smaller coastal communities being financially healthier than they have ever been.
In the farming sector this season may not be as a good as the past few years. There may be a bit of a setback among potato growers, due to a lack of rain this summer in some parts of the province. And, the dairy industry is facing some uncertainty given the loss of some of the domestic market to the US, Europe and Asia, because of the new trade agreements. But, the dairy industry is still in good shape.
Overall, Island farmers have fared fairly well. They are growing new crops, such as pulses, beans, soybeans and crambe which are sold in markets that a few years ago many Island farmers didn’t even know existed. (Crambe produces an oil that is used in the cosmetic industry. Pulses are peas and lentils that are eaten in many Middle Eastern and Asian countries.)
While the weak Canadian dollar has helped Island manufacturers sell the goods into the American market, there is more to it than that. Islanders have developed skills and talents that are in demand and Island industrial businesses are growing and expanding.
Standard Aerospace, the latest owners of the engine repair facility at Slemon Park in Summerside, is closing their other operations across the country and making Summerside its sole facility for repairing Pratt and Whitney turbine engines. When driving on the highways of Ontario and Quebec you often see large, Trout River truck trailers, units which are manufactured near Coleman, in Prince County, west of Summerside. Another example is the expansion of the BioVectra plant in Charlottetown.
While the provincial economy has grown from $6 billion in 2015 to $7 billion in 2018, the government should not forget, the Island still has the second lowest average earnings in the country. P.E.I., with average earnings of $61,100 is $10,600 a year below the Canadian average of $71,700. Only New Brunswick with average earnings of $59,300 is lower. The Island is still a poor province.
However, the surplus is good news, but there’s one niggling question about the announcement, why Wednesday? Why not wait two weeks until the legislature opens? Could it have anything to do with the premier’s poll numbers? The CRA will soon be gathering information for its next quarterly poll; surely Wednesday’s announcement wasn’t timed to influence those numbers?