Bold decisions coming
Budget will map strategy to deal with decreased oil revenues: Davis
The province will have to make some bold decisions as it tries to compensate for the drop in oil prices and revenues, Premier Paul Davis said Friday.
“The price of oil is having a major impact on our planning over the next several years,” Davis told those gathered at a Greater Corner Brook Board of Trade luncheon at the Glynmill Inn in Corner Brook.
Twice the province has had to revise its deficit figures because of the drop and that has created a big challenge, but it’s one the government is not shying away from, he said.
“The budget that we’re putting together is going to tackle that current problem head-on and we’re going to map out a strategy for the coming years as well as the short-term.”
Through the ongoing consultation process the government is asking people about the programs and services it offers — which ones are appropriate to provide, which ones are expected, which ones should the province not provide or which it is not providing that it should, and whether there is a larger role for the private sector.
Davis said there is an idea that when things were going well the province should have put money away for a “rainy day.”
But he said when the Conservatives took power a decade ago the province had a significant deficit in infrastructure.
“We had major demands and needs in this province for infrastructure and we still do today.”
When the revenues became available the province used that to address the infrastructure issues.
“We’re not there yet,” Davis said of meeting all the needs, “but we’ve come a long way in the last decade.”
But what that meant was there was no opportunity to put money away, he said.
Now the province has to talk about those rainy days, Davis said, “and be able to equalize our budget and our finances.”
Looking to the long-term, Davis said the price of oil will rebound and with it the expected revenues.
He noted the west coast has great potential to play a role in the industry and there will be benefits for businesses and communities, new industrial opportunities and employment growth.
“We will manage our way through this,” he said.
He said the province will look at things through a short-term, middle-term and long-term view before releasing a budget in April that will include some bold decisions.
“We’re going to have a plan that’ll get us through this cycle of low oil prices. We’re going to bring us back to balance and we’re going to set the tone for a great future for Newfoundland and Labrador.”