Minister Releases Year-end Forecast

Nova Scotia Finance Minister Neil LeBlanc updated the province's year-end forecast today, Dec. 20, and despite a decrease in federal revenue, the government is projecting its surplus will rise to $8.3 million. That's $7 million more than estimated when the 2002-03 budget was introduced in April.

"While the surplus is still small, it is definitely headed in the right direction. This increase shows the Nova Scotia government's fiscal plan is working," said Mr. LeBlanc.

Total government spending increased by $21.8 million, including $11 million in over-spending by district health authorities. Overall, revenues are up $28.7 million over the original budget, resulting in the higher-than-projected surplus.

A strong economy has resulted in higher personal and corporate income tax revenues. This growth is largely responsible for the increase in provincial revenue, but is also the reason for fewer federal transfers.

"Nova Scotia is losing $60 million in equalization payments from Ottawa," said Mr. LeBlanc. "That's a big hit to our budget, so we have to be extremely cautious to keep our spending in check."

"The cost pressures for this year -- and next year too -- aren't going away. There are still a number of serious challenges before us and that means making tough choices," said Mr. LeBlanc. "We have to be careful that we finish the year the way we started it -- in balance."

The minister said that wage settlements, which are still in the negotiation stage, are the biggest threat to the government's bottom line.

Mr. LeBlanc also released the province's financial statements for the fiscal year ending March 31, 2002. The government finished the year better than expected, with a $54-million deficit -- $36 million less than the original budget.