New Brunswick government's projected surplus skyrockets
CBC
The New Brunswick government's projected budget surplus for the current fiscal year has skyrocketed to almost half a billion dollars.
The Higgs government is spending more than expected but is also raking in far more revenue than anticipated, producing a projected surplus for 2021-22 of $487.8 million.
According to a third-quarter fiscal update from Finance Minister Ernie Steeves, the financial windfall includes:
In his provincial budget last fall, Steeves projected a deficit of $244.9 million this year.
But a faster-than-expected economic rebound has led to more spending and more revenue from taxes on everything from property sales to retail purchases to gasoline.
Employment was up 2.5 per cent in 2021 while wages and salaries in the first three quarters of the year were 7.8 per cent higher than in 2020.
The province is spending more than planned because of COVID-19, new labour contracts with public-sector workers and a new child-care agreement with the federal government designed to lower costs for parents.
But those extra expenses were more than offset by the flood of additional revenue.
Assistant deputy minister Peter Kieley told a media briefing that the $832 million variation from revenue projections last year was "unprecedented by New Brunswick standards."
He said the federal government, which administers HST and corporate income taxes for the province, recently provided new calculations showing the "national revenue pool" is larger than expected.
The province's population growth also meant that per-capita federal transfers increased.
Steeves warned that some of the windfall from federal COVID spending isn't expected to last, and that means he's not willing to spend the surplus.
"We can't expect to have this level of revenue growth in all future years," he said.
But he said the government is "strongly considering" reducing property taxes on rental properties.
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