Nova Scotia surplus up slightly despite increased health spending:forecast

By The Canadian Press
December 21, 2017 - 9:15am

HALIFAX — The Nova Scotia government says it is on track to balancing its books for the second year in a row — the first time in a decade — despite mounting costs in the province.

Finance Minister Karen Casey delivered a budget update Thursday positioning the Liberal government as a steady hand on the province's finances.

"The government has laid out a clear, reasonable and what we believe is a sustainable fiscal plan," Casey said. "It is that strong management of taxpayers' dollars that has put Nova Scotia on sustainable financial footing."

The province is projecting a $28.9-million surplus for 2017-2018, about $7.6 million higher than forecasted in September when Casey presented a revised budget initially tabled ahead of last spring's election.

The updated $10.5-billion budget for the fiscal year ending in March included $42 million in added revenues, offset by $16.5 million in extra expenses and $17.8 million in adjustments.

NDP Leader Gary Burrill called it "hurtful and infuriating" for the government to tout a budget surplus "at a time of year when hundreds and hundreds of volunteers around the province are doing everything they can to try to make a Christmas in charitable organizations and food banks for people that wouldn't otherwise have one."

He said the province should invest surplus revenues into nursing home care and combating child poverty.

Casey pointed to a $30-million increase in health care spending as a reflection of the government's response to provincial needs.

"The dollars were made available to make sure that the front-line health care workers were available to meet demand," she said, adding that the extra money comes on top of an extra $6.2 million added to the health budget in September.

The Department of Health and Wellness budget is roughly $4.2 billion, more than 40 per cent of the provinces total spending.

Progressive Conservative finance critic Tim Houston says an added $2.5 million set aside for ambulance service in the province sheds light on a greater problem.

While the province said the extra money is in response to higher call volumes, Houston questioned why more people are calling Emergency Health Services for an ambulance.

"That is a symptom that really tells us what is happening in health care," he said. "ERs are overcrowded and people are having to leave ERs and take an ambulance back to the ER (to access health care)."

Meanwhile, Nova Scotia is expected to collect more income tax this year from higher personal taxable incomes and growing national corporate taxable incomes.

But the province also recorded a prior year adjustment of $162.3 million from lower personal income tax than expected.

Although the Finance Department said this is primarily due to tax planning undertaken by wealthy individuals in advance of Ottawa's new high-income tax bracket, Houston said it reveals the struggle of Nova Scotians.

"I was saying when budget updates were done in the prior year that people were struggling. I could feel it around the province," he said. "I was leery of the personal income tax projections that were being made in the prior year and today we found out that suspicion was correct."

However, despite forecasts for higher income revenues this year, those increases will be dampened by an anticipated drop in HST, fuel tax and tobacco tax revenues.

Also, the fiscal update showed the cost for paying out the long service award to public sector workers is projected to cost $25.6 million.

Yet Nova Scotia also recorded a positive prior year adjustment due to new offshore royalty calculations related to how natural gas is transported, resulting in an extra $150 million on the province's books.

The Department of Business saved $700,000 in amortization and operating savings due to Halifax Convention Centre delays.

Also, the Nova Scotia Provincial Lotteries and Casinos Corp. forecasted an extra $3.1 million due to a delay in the Cogswell Interchange overhaul, which the provincial Crown corporation had anticipated could hinder business.

The Nova Scotia Liquor Corp. expects a slight decrease in income due to lacklustre sales, down an estimated $400,000.

Brett Bundale, The Canadian Press

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