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Wednesday, April 6, 2011

Steele denies lowballing budget projections

Provincial deficit magically turns into big surplus

Posted By on Wed, Apr 6, 2011 at 7:56 AM

Graham Steele displays budget at Province House
  • Graham Steele displays budget at Province House

Nova Scotia’s finance minister testily dismissed suggestions yesterday that he deliberately underestimated provincial revenues in last year’s budget. He was responding to reporters who suggested he lowballed revenue projections in the 2010 budget in order to make the government look good this year.

“Let’s be clear about this. The revenue estimates are formulated by the same people, following the same procedures and the same professional standards as under previous Conservative and Liberal governments,” Graham Steele told reporters. “In addition to that, the revenue estimates are reviewed by the Auditor General...So if you’re criticizing us, you’re criticizing the professional staff in the department of finance and you’re criticizing the Auditor General.”

In his 2010 budget, Steele forecast a $222 million deficit — almost a quarter of a billion dollars. Yet the night before Steele brought down this year’s budget, Premier Dexter informed the legislature that the deficit had turned into a surplus of $447 million — almost half a billion dollars. The surplus was partly due to higher-than-forecast tax revenues and federal transfer payments. Spending restraint and the government’s decision to pre-pay $327 million in university funding the year before also contributed to the turnaround.

In spite of the surplus, Steele is once again projecting a sizeable $390 million deficit in the coming year.

Opposition leader Stephen McNeil accused the government of playing games with numbers.

“Nova Scotians can no more believe in the numbers that were presented to us today than they could in the ones that were presented last year,” McNeil said. He added that the NDP are once again inflating expenses and lowballing revenues.

“We believe they’re misleading Nova Scotians again today to justify an HST increase, to justify every user fee going up, to justify downloading $50 million onto municipalities which will end up on the municipal tax bills of every Nova Scotian.”

While McNeil focused on taxes, social activists criticized Steele for trying to restrain spending. For example, Kyle Buott of the Nova Scotia Citizens Health Care Network expressed disappointment that the government is freezing health spending.

“This is just unacceptable to come from the NDP,” Buott said. “What we saw is a $500 million surplus and that means that we actually have the money to be investing in social priorities for Nova Scotians.”

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