Spending shows it's 'tough times' for Islanders in latest fiscal update

The province is now predicting a $98.6 million deficit, one million dollars more than anticipated in this year's original operating budget. 

That number comes from a fiscal and economic update, outlining the financial state of the province and looking ahead to spending and revenue in 2024. 

Revenues have grown by $25.7 million since the last statement. That comes from more money collected from taxes and an increase in federal transfers showing in the updated statement. Tax revenues increased $7.5 million and transfers went up $12.7 million. 

Planned spending is up as well. Expenditures are forecasted to increase by $26.7 million.  

 Finance Minister Jill Burridge said there are two main reasons for the jump.

"The big ticket items in there would be through the environment, energy and climate change department, and the energy efficiency programs that they're putting out," Burridge said in an interview with Louise Martin on CBC News: Compass. "Heat pumps, I think the capacity built up out there so they were able to do more and more work, more than they projected."  

Social development spending took a jump as well. 

"They just need more money because they're seeing more people come through their doors that are needing more," Burridge said.  

"It's tough times for a lot of people out there. We are seeing it everywhere, that's why we are trying to accommodate as best we can."

The province releases this update yearly, after the second quarter. 

The year saw growth in employment, retail sales and manufacturing shipments, as well as international exports, particularly fresh potatoes, frozen food and pharmaceuticals. The province also credits a rebound in construction later in the year. 

Burridge said the province is planning on a more predictable revenue forecast in the months ahead, for a few reasons.

"It's not as volatile as it was in the past few years," she said. "With COVID, and Fiona, there were a lot of federal transfers coming in and things that we couldn't plan for or predict, so it was a little more volatile."