Finance Minister Ernie Steves presented the financial statements for the second quarter of 2021-2022 for the territory. For this quarter alone, the minister projects a surplus of $248 million. The surplus in the first quarter amounted to 158 million dollars.
However, for the full fiscal year, the minister expects that the province’s financial position will not continue to grow. Therefore, the surplus at the end of the year should be $89 million.
We must remain cautious, as temporary factors affecting our revenue growth are not expected to persist.
This decrease in the expected surplus by the end of the fiscal year, according to Minister Steves, is due to expenses that will occur in the next two quarters. It also referred to costs related to new employment contracts with the Canadian Federation of Public Employees (CUPE).
However, significant amounts have already been allocated in the budget to meet these costs, which should limit the impact on public finances.
Predictions vary a lot
In November 2020, the government projected a deficit of $183 million, but at the end of the fiscal year, the surplus was $408 million.
Estimates given by the Higgs government tend to underestimate budget surpluses. Minister Steves reports that because of the pandemic, it has been and remains difficult to accurately predict government spending. The government also tends to make very conservative forecasts.
Thus, when the regional budget was presented, a deficit of 245 million dollars was expected, and in the first quarter of 2021-2022, the trend was completely reversed. We expect a surplus for the year of $38 million, a difference of more than $280 million.
Less expenses, more income
The county’s revenue is expected to exceed budget estimates by $487.2 million.
This amount is explained by a decrease in expenses and an increase in income.
Spending fell in several departments, including post-secondary education, social development and justice. Thus, the number of requests for social assistance has decreased thanks to the assistance provided by the federal government to individuals.
The increase in revenue was attributed to increased federal transfers, which are intended to support the county’s efforts to combat the pandemic, but also to increase revenue from income taxes on individuals and businesses. This increase is directly related to the sustainable growth in the economy, which is expected to continue this year.
More realistic financial expectations
Economist Richard Silant believes that the Treasury Secretary provided more realistic financial data than those provided for the first quarter. According to him, the conservatives underestimated the budget surplus due to negotiations in the public sector.
It is a very reprehensible act in a democracy, estimates the economist.
The government deliberately undervalued its revenue, likely in an attempt to manage expectations in collective bargaining.
Thus, during the first quarter, government revenues from its own sources were valued at 6 billion and 165 million dollars. In the second quarter, it is now valued at $6 billion and $403 million.
As if surprising, after negotiations with the Canadian Federation of Public Employees ended, the government suddenly, in just five weeks, identified nearly an additional $250 million in revenue while there was no fundamental improvement in the economy., comments by economist Richard Silant.
According to the economist, if the government continues to evaluate its revenues and expenditures in the same way, this is a deficit that it should have declared.
If we didn’t make that adjustment, by telling us the truth, we’d end up with 150 million, which of course the government doesn’t want to announce., confirms.
Invest in public services
In Fredericton, the Liberals and the Greens are urging the Conservative government to use budget surpluses to better fund public services, starting with health.
We must address the issues facing New Brunswickers, whether it is health, long-term care, affordable housing or mental health., argues Robert Mackey, the Liberal MP for the Moncton Center.
We have never needed our public services so much, to invest in the common good.
Even the Green Party is ringing the bell, mourning the approach of the Conservative government.
Too little investment currently to tackle climate change, too little investment to tackle issues of poverty, and a shortage of health workers, confirms Kevin Arsenault, Green MP for Kent North.
However, on the health front, Finance Minister Ernie Steves says there is no need for more investment.
Financial health is not a concern at the moment, what they need, they getThe minister is reassured.
We cannot trust the numbers the government gives us, they are manipulating the numbers for their own benefit.
Rep. Mackie is criticizing the government for suggesting that the surplus will be lower this year, due to the agreement reached with union members in the public sector, which members have not yet approved.
Today they are also trying to attack public sector workers with their wage deal by estimating an additional $200 million in general government, but in my opinion the money was in the budget this year., appreciated by Robert Mackey.
According to him, over three years, the government allocated $500 million for concluding agreements with public sector employees.
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