NDP paves way for deficit budget

Nova Scotia's New Democrats are changing the definition of a deficit, after defeating the former Tory government for trying the same thing.

The NDP government introduced a bill Friday to allow it to table a deficit budget and spend money that was supposed to be used to pay down the debt.

The amendment to the Provincial Finance Act also removes the requirement for a deficit to be recovered the following year.

Finance Minister Graham Steele said the changes are needed to reflect the province's financial woes.

"With the reality of the situation that's facing us now with an actual deficit, it is clearly not possible to notionally apply the offshore offset to the debt. When the economy recovers, when the finances of the province recover that may be possible once again," he said.

The NDP tabled its first budget last month, though the document largely mirrors the promises of the previous Progressive Conservative government. The NDP projects a deficit of $592 million for this fiscal year, with the net debt climbing to $13.5 billion.

Steele accuses the Tories of "poor fiscal planning."

'Very hypocritical'

Last spring, the minority government of Rodney MacDonald tried to spend the offshore offset, a one-time payment from the federal government that is currently required to go towards the debt.

The government collapsed May 4 when the NDP and the Liberals voted against the Tories' bill . The move forced an election, which saw the NDP sweep to victory and form a majority government.

The Liberals and the Tories are now accusing the New Democrats of hypocrisy.

"It's just very hypocritical," said Tory finance critic Chris d'Entremont. "Here we are spending over $10 million for an election, the change and strain of changing government, and to be right back in the exact same place that we were back in May."

Leo Glavine, Liberal finance critic, is worried the NDP is eliminating the legal imperative to balance the books, not just delaying it.

"There's no sunset clause," said Glavine. "The premier's talking about a balanced budget next year, but obviously they're moving in a different direction."

Steele said the NDP government plans to present a balanced budget next spring.

He also said his party defeated the Tories in May because it had no confidence in them.

"I wouldn't characterize it as having been based on any one particular item. It was just a lack of confidence in the previous government," he said.

The changes proposed Friday are part of a bill that shelves two tax credits, freezes the salaries of MLAs, senior bureaucrats and political staff, and increases nearly every government service fee.