N.B. deficit to rise by $65.5M

The New Brunswick government is forecasting the province's deficit will grow by an additional $65.5 million to a total of $514 million in 2011-12, according to the province's fiscal update.

The Department of Finance issued the fiscal update on Friday, showing three departments that overspent a total of $65.5 million.

• $37.1 million increase in general government, blamed on increases in pension expense and provision for losses
• $19.2 million increase in health, blamed on higher than anticipated expenditures within the Prescription Drug Program and the Regional Health Authorities
• $9.1 million increase in social development, blamed on additional expenditures in the Income Security Program.

The new deficit is up from the province's projection in March that New Brunswick’s deficit would fall to $448.8 million in 2011-12.

Now, the fiscal update also expects the net debt will now increase by $48.2 million, an increase of $678.4 million year-over-year.

New Brunswick also lost 6,000 jobs in the first quarter of the year. The release said gains in part-time employment have not been enough to offset full-time losses.

Few departments spent less than what had been budgeted.

The province also said it was lacking forecasted revenues from Atlantic Lottery, down $8.2 million due to factors including higher than anticipated payments to First Nations, lower than anticipated profits for Atlantic Lottery Corporation and lower casino revenues projected.

Earlier this year, Finance Minister Blaine Higgs raised the tax on cigarettes and gas and reduced the number of top bureaucrats in an effort to reduce the deficit.

A handful of government agencies were cut completely, such as the Provincial Capital Commission, the Advisory Council on the Status of Women and the Secretariat for Community Non-Profit Organizations.

In comparison, the Nova Scotia government is projecting to have a balanced budget in 2013-14.

New Brunswick Premier David Alward has instructed all of his departments to cut spending as it tries to meet its election platform commitment to erase the deficit in its mandate.

The department did not issue a statement on its finances but it posted the update on its website Friday.

"We didn't do a release on it because it's a routine update," Finance spokesman Brendan Langille said in an email.