The Legislative Assembly of Saskatchewan resumed sitting today for its Spring Session and the first order of business was for the Moe Government to table the 2021/2022 budget. Finance Minister Donna Harpauer tabled their plan for the next fiscal year (April 1, 2021 to March 31, 2022) and it results in a forecasted deficit of $2.6 billion and does not plan to get back to a balanced budget until 2026/27. Deficits are forecasted at $1.7 billion for 2022/23, $1.2 billion in 2023/24 and $770 million in 2024/25. There is no forecast for 2025/26 and back to balance in 2026/27.
The budget tabled today increases spending by an additional $1 billion over the budget of 2020/21, a 6.3% increase. The major spending increases are in:
Revenues are forecasted to increase by 6.1% over the budget of 2020/21, but the government has not released its Third Quarter update from this past fiscal year to indicate where it believes last year’s deficit will end up. There are some minor tax changes with respect to vaping products and a new Road Use Fee for Electric Vehicles so that “all road users contribute to road maintenance and replacement.”
“This budget will protect Saskatchewan people through the pandemic, as more vaccines are received and life begins to return to normal,” Harpauer said. “This budget will build Saskatchewan by investing in new long-term care facilities, hospitals, schools, highways and vital municipal infrastructure. And as our province and our economy emerges from the pandemic, this budget will grow Saskatchewan through incentives and key investments, while keeping life affordable for families.”
Harpauer said the COVID-19 pandemic is not only a global health crisis, it is also the biggest shock to the Saskatchewan, Canadian and world economies since the Second World War.
The government plans to spend $3.1 billion of capital spending to stimulate the economy and create jobs. Harpauer went on to say, “But we are going to make the investments needed now to protect Saskatchewan people through the end of the pandemic and to drive a strong economic recovery as we emerge from the pandemic.”
The government expects to see Saskatchewan’s real GDP grow by 3.4% in 2021 after seeing a projected contraction of 4.2% in 2020. The Minister concluded her speech by referencing last October’s provincial election by saying, “In the election campaign last fall, we made 14 specific campaign commitments to make life more affordable for Saskatchewan people,” Harpauer said. “This budget fulfills all 14 of these commitments. We did what we said we would do.”
Insights and Analysis
Saskatchewan Finance Minister Donna Harpauer Tables 2021-2022 Budget