Province on Track with 2006-07 Budget

The province of Nova Scotia has released its first budget forecast update for 2006-07, showing a slightly higher surplus overall and minor changes in revenue and spending forecasts.

Nova Scotia's surplus is forecast to increase by $1.5 million to $75 million, up from the $73.5 million in the July 4, budget. The budget includes a $57.4 million legislated surplus to be allocated to the debt.

The province is now forecasting total revenues for 2006-07 of $6.58 billion, along with net income from government business enterprises of $336.6 million. Total expenses are forecast to be $6.89 billion.

"We are pleased to see a small increase in the surplus, which contributes to our success in meeting our debt management targets," said Finance Minister Michael Baker. "Our 2006-07 budget is unfolding as expected, and the changes to date are very small."

Changes since budget include improvements in debt servicing costs and reduced costs in other areas. These are offset by lower tobacco revenues and a small increase in spending on highways.

Debt servicing costs are forecast to drop by $9.5 million from budget, while total revenues are projected to decrease $8.4 million and net program expenses will go up by $1.4 million.

Nova Scotia has been recognized by major bond rating agencies for its ongoing improvement in financial management. Two bond rating agencies upgraded the province's credit rating this summer.

The province continues to anticipate a 2.5 per cent growth in real gross domestic product in 2006, consistent with the budget forecast.

Nova Scotia is required by law to issue its first budget forecast update each year by the end of September.

A copy of the forecast update is on the website at www.gov.ns.ca/finance .