Special Spending Warrants Approved

The provincial government approved special spending warrants today, ensuring government services are not interrupted pending approval of a budget for 1999-2000.

The special warrants mean government departments are able to meet planned commitments to Dec. 31, 1999. The total spending authorized now amounts to $3.8 billion. This compares to $4.6 billion spent during all of 1998-99.

"We would have preferred to authorize a smaller amount, but we wanted to ensure services would not be interrupted if the legislature needs extra time to consider our new budget this fall," said Finance Minister Neil LeBlanc.

Another consideration is that most departments were forecast to have higher costs in 1999-2000, mainly because of wage increases and extra funding for health care. That means departments need authority to spend more than they did during the same period last year.

The government expects to present a budget for the current fiscal year in October -- the start of the third quarter of the fiscal year. The House of Assembly is not expected to pass a budget for the current fiscal year until at least three weeks after that.

Without that legislative authority or a special warrant, spending by government departments and agencies is limited to 50 per cent of the prior year's budget. With the fiscal year half over next month, several departments are close to that limit.

While authority to spend has been legally granted now, Mr. LeBlanc said the budget will undoubtedly change some of the forecast spending directions.

"Our government will set new priorities before the House this fall. The budget finally approved by the legislature will override all of the authorities granted today," said Mr. LeBlanc. "These special warrants simply allow us time to consider all options carefully."

The special warrants approved by cabinet today include $1.26 billion for program spending and $279 million for debt management for a total of $1.54 billion. In addition, the warrants provide the required authority to transfer $84 million for Sinking Fund installments and Serial Retirements from one fund to another.