Province Posts Surplus In 2003-04
The province of Nova Scotia ended the 2003-04 fiscal year with a $43-million surplus, according to annual financial statements released today, Sept. 30, in Halifax.
The 2003-04 public accounts, detailing financial results of the year ended March 31, 2004, showed revenues exceeded expenses by $42.6 million, about $40 million more than budgeted. The surplus will go toward paying down the debt.
"Hurricane Juan was one of a number of unexpected factors that affected our bottom line in 2003-04," said Finance Minister Peter Christie. "We managed through them all to keep Nova Scotia on a solid financial footing."
Some key revenue categories were up, others down, leaving the province with revenues $45 million higher than budgeted. Revenues from HST and provincial income tax collected in previous years increased by $145 million, while federal revenues for equalization and other entitlements dropped about the same amount, due in part to new census figures. As well, the 2004-05 budget restored $19 million in 2004 tax revenues that had been taken out of the 2003-04 budget.
Net program expenses were $40.7 million, or 0.86 per cent, over budget at year-end. Government reduced expenses by $32.8 million through the Budget Management Plan introduced in September 2003. However, expenses were over budget at year-end by $55 million in health care, $15 million in Emergency Measures, and $7 million in universities.
Accounting changes contributed to a decrease of $16.9 million in net operating expenses overall. A review of the useful life of government assets and capitalization thresholds caused a reduction in net program expenses for tangible capital assets. Government incurred additional expenses due to updated liability estimates for some employee salary and benefit plans.
The province also sold the last remaining assets and shares of Nova Scotia Resources Limited for a net gain of $8.7 million.
Nova Scotia's economy performed well during the fiscal year, despite shocks from three severe weather events, public health concerns over SARS, and the effects of BSE on the agricultural industry. Growth in Gross Domestic Product (GDP) in current dollars stood at 6.3 per cent in 2003 for Nova Scotia, compared to 5.3 per cent for Canada. As well, the ratio of net direct debt to GDP dropped to 42.8 per cent at March 31, 2004, from 45.1 per cent a year earlier.
Financial and economic numbers for the year were encouraging. Net debt servicing costs went down $47.8 million (5.4 per cent) with better interest rates, and foreign currency exposure dropped to 16.9 per cent, well ahead of schedule on a September 2004 target of 20 per cent.
Mr. Christie released the statements two months earlier than usual, to meet new legislative requirements that the annual documents be issued publicly by Sept. 30 each year.
The auditor general provided his unqualified audit opinion, confirming the province's financial statements are in order and in compliance with generally accepted auditing principles (GAAP).