Provincial budget for 2023-24 projects a large surplus and increased spending

Posted on 5 April 2023 by Matthew Liebenberg

By Matthew Liebenberg

mliebenberg@prairiepost.com

Swift Current MLA and Minister of Mental Health and Addictions, Seniors and Rural and Remote Health Everett Hindley feels there is plenty to celebrate in the 2023-24 provincial budget.

“This is a very exciting budget for Saskatchewan as a whole,” he told the Prairie Post. “We’re really trying to ensure that we provide a balance between fiscal responsibility, but still making key and significant investments in the areas that need it in this province.”

The new budget was tabled in the Saskatchewan legislature, March 22. There is a projected surplus of $1 billion. Revenue in the 2023-24 budget is expected to be $19.7 billion, which is an increase of $2.5 billion or 14.7 per cent compared to last year’s budget.

The increase in revenue is mainly due to higher taxation income from corporate and personal taxation as well as provincial sales tax revenue. Taxation revenue is expected to increase by $1.5 billion to $9.6 billion.

Non-renewable resource revenue is projected to increase by $435 million to $3.3 billion, largely due to anticipated solid oil and potash prices. The budget assumes a WTI oil price of US$79.50 per barrel and a potash price of US$369 per KCI tonne.

The provincial government will use the extra cash from the budget to pay down up to $1 billion in operating debt, which will reduce interest costs.

Total expenses in the budget will be $18.7 billion, which is an increase of $1 billion or 5.9 per cent compared to last year’s budget.

There are no tax increases and no new taxes in the 2023-24 budget, but no additional measures to assist provincial residents with cost-of-living pressures. Hindley noted the provincial government already took steps last year through the Saskatchewan Affordability Tax Credit (SATC) program, which offered a one-time $500 payment to eligible Saskatchewan residents to address inflationary pressures.

“There’s been a number of steps that have been taken over the past number of years,” he added. “Reductions in income tax as an example have removed 12,000 low-income citizens off the provincial income tax roll. We have one of the highest tax-free thresholds in Canada. … We’re trying to do what we can to reduce costs for everyday living through increases to things like the Saskatchewan housing benefit, trying to keep utility bundle costs low in this province, creating more tax credits that we’ve done in a number of different areas.”

He noted the budget is a balancing act between revenue and expenses, and the government’s goal for several years has been to reduce its reliance on non-renewable resource revenue.

“We’ve been trying to rebalance that amount so that there’s a more predictable revenue and not as reliant on non-renewable resource revenue, but on more stable forms such as taxation,” he said. “That’s the balance we’re trying to strike to make sure that we are keeping things affordable for Saskatchewan people, that we do have a fair taxation amount for our residents, but also to ensure that we’re able to fund the important and necessary programs and services that we need in Saskatchewan.”

Saskatchewan NDP finance critic Trent Wotherspoon said during a media briefing it is an out-of-touch budget that fails to meet the moment.

“This budget offers no new cost of living relief for families struggling to pay their bills at the end of every month, not a stitch of relief,” he said.

He felt the increases in budget allocations to health care and education will be insufficient to deal with actual needs.

“You’ll hear this government pat themselves on the back for what they’ll call record investments in health care, but the investment that they tout just keeps pace with inflation at a time that we’re facing a crisis,” he said. “At a time that we’re competing against the rest of Canada to retain those professionals and those workers to deliver those services when people need them and where they need them.”

He questioned the government’s spending priorities, including the decision to use the entire surplus to pay down debt and a commitment of $260 million over a decade to create a provincial revenue agency.

“This government has the resources right now to step up and make those investments into classrooms and in our health care system,” he said. “The cost of not doing so will only cost us far more into the future and it will cost our potential as a province economically and socially as well in not making those investments.”

Wotherspoon felt it could have been possible for the government to still have a budget surplus while making additional investments in areas such as health and education.

“These are investments that could be made, there will still be a massive surplus and it would put us in a better fiscal and economic position down the road,” he said.

Hindley noted the budget includes a record investment of $3.1 billion to the Ministry of Education, which is an increase of $192.8 million or 6.7 per cent over last year. The 27 school divisions will receive $2 billion in operating funding, an increase of $49.4 million over last year.

“We are trying to do as much as we can to make investments into all areas of this province and that includes education,” he said. “We have made some significant investments in the past. Is there more that could be done? Arguably yes, there is, but I think these are significant investments that are being made as part of that particular ministry and we’ll continue to have those meetings and discussions with our local school divisions to do whatever we can to continue to provide support to them.”

He mentioned that there is record spending of $7.1 billion in this provincial budget on health. It includes $6.9 billion to the Ministry of Health, which is an increase of 6.7 per cent over last year.

The budget allocates $98.8 million for the Health Human Resources (HHR) action plan to recruit, train, incentivize and retain health care professionals. There is an allocation of $22 million for 250 new full-time positions and expanding part-time positions in rural and remote areas of the province. There is an amount of $42.5 million to fund surgical procedures and 6,000 more surgeries will be performed this year.

The budget includes $8.8 million to enhance emergency medical services in the province, including in rural and remote areas. Shaunavon in southwest Saskatchewan is one of 27 communities that will receive additional resources to recruit staff as part of this strategy, which started last year.

“That particular initiative has worked very well,” he said. “I’ve heard from groups such as the Paramedic Services Chiefs of Saskatchewan and from individual ambulance operators from across the province that this program is making a difference in helping to alleviate some of the pressures that they are facing.”

The budget includes $3.1 million in new funding for a travel pool of registered nurses to travel to rural and remote locations to provide coverage during nursing absences and to temporary fill nursing vacancies.

“Ultimately we don’t want to be using these,” he said. “We’re trying to make sure we’re fully staffed when it comes to nurses, whether it’s RNs, LPNs, care aids, lab techs, combined lab Xray techs across Saskatchewan, but on this area we do know from time to time there will be disruptions.”

There is also $1.3 million in new funding to create 12 physician assistant positions for the first time in Saskatchewan’s health care system. They will practice under the supervision of a licensed physician.

“Other provinces have been using these and it’s another complement to health care.,” he said. “At this point the training is done in other jurisdictions, but we’re able to benefit from those training programs. … It’s a new type of service that we can use to help complement some of the work that’s been done by our doctors and by our physicians, building up that complement of health care workers.”

The 2023-24 budget includes the highest ever allocation of $518 million for mental health and addictions programs and services. The funding for mental health and addictions now represents 7.5 per cent of overall health spending.

Hindley said this will result in an increase in the addictions treatment bed capacity in the province. The free walk-in counselling services offered at 30 locations around the province will be expanded to children and youth, starting initially at 11 of these locations.

There is a new initiative to establish three residential homes for youth with chronic mental health and addictions issues. The location of these homes will be announced in coming months. There is also a new granting program to help fund the expansion of peer support groups for people who are in recovery who might otherwise be struggling with addiction issues.

He referred to various other initiatives that are funded through the provincial budget that aims to provide supports to people who need help getting into treatment and recovery, but also to address education and awareness about addiction as well as enforcement.

“Education is important and prevention as is treatment and recovery, but also the enforcement side of it,” he said. “So it’s really a multi-pronged approach from government.”