Finance Minister Donna Harpauer. (Lisa Schick/980 CJME)

By CJME

Saskatchewan posts $319M deficit in the wake of COVID-19

Jun 30, 2020 | 1:08 PM

The provincial government says the final results for the 2019-20 fiscal year show a $319-million deficit.

In a release, the government said that’s attributable to a steep revenue decline in the fourth quarter largely caused by the impact of the COVID-19 pandemic and resulting market downturn.

“Prior to the global COVID-19 pandemic, Saskatchewan was on track for balanced budgets in 2019-20 and in the current fiscal year,” Finance Minister Donna Harpauer said in the release.

“Our government released a budget on June 15 that meets the challenges presented by the pandemic. I am confident that as Saskatchewan’s economy recovers, our revenues will also recover and we will get back to balance in the coming years.”

The release noted the province’s revenue declined by $490 million in the fourth quarter, largely due to a $431-million decline in net income from investment losses in the Government Business Enterprises (GBEs).

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Total revenue of $14.89 billion in 2019-20 was less than budgeted by $138 million, or 0.9 per cent. The Ministry of Finance says the decrease was a result of lower-than-expected net income from GBEs, non-renewable resource and taxation revenue, partly offset by greater-than-expected transfers from the federal government and other own-source revenue.

The ministry says revenue in 2019-20 was up by $386 million compared to the previous fiscal year.

Total expenses were $15.21 billion in 2019-20, which is $216 million or 1.4 per cent greater than budgeted. The increase over budget was primarily due to greater-than-expected education expense related to non-cash pension expense and health expense due to volume-based pressures.

Those increases were partly offset by lower-than-budgeted agricultural insurance claims due to favourable crop conditions.

Total expense in 2019-20 represents an increase of $437 million, or 3.0 per cent, compared to the previous fiscal year.

“Our government will continue to assist Saskatchewan people through the pandemic while continuing to invest to stimulate the provincial economy and create jobs,” Harpauer said.

“Every province in Canada and every jurisdiction in the world has been impacted financially and economically by the global pandemic. However, Saskatchewan is better positioned than most on the path to economic and financial recovery.”

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