New Brunswick is reporting a $247.4 million projected surplus for 2023-24 fiscal year, a jump of more than $200 million since its last fiscal update in November.
The province’s finance minister, Ernie Steeves, says the large increase is because New Brunswick’s portion of the harmonized sales tax revenue is much higher than originally predicted.
Steeves says his department found out in December that the HST revenue would be up $346.6 million because of a “significant increase to the national revenue pool on which payments are based.”
Finance staff said New Brunswick isn’t the only province experiencing this, saying volatility has been ongoing since the pandemic.
“Going from a world-wide pandemic into a period of very rapid population growth which has continued, high inflation and certainly many of the models that we would use aren’t necessarily designed to capture periods of such extreme volatility,” said Todd Selby, executive director of the Fiscal, Economic and Statistical Analysis branch of the Department.
“This is not an unusual event across the country; New Brunswick’s not alone in that regard. You’re seeing many other jurisdictions that are also struggling with this; particularly in the case with HST…we do rely very heavily on the estimates that are prepared by the Government of Canada.”
Steeves said he has sent a letter to Deputy Prime Minister Chrystia Freeland to see if changes can be made so they can better predict what New Brunswick’s share of the HST will be.
Spending is expected to rise too, by $303.5 million. The majority of that figure will go to the Department of Health, which is $212.4 million over budget.
“Largely, in respect to resourcing, with respect to nurses,” said Nick McCann, assistant deputy minister of finance.
“Trying to meet the needs for health care for New Brunswickers to ensure they have access, the needed health-care services that they need.”
Staff said household spending is up in New Brunswick and across the country.
With a higher population, the opposition said the province should have been able to better predict a more accurate surplus was coming.
“Now they’re blaming the system when everyone could clearly see more revenue was rolling in,” said finance opposition critic René Legacy.
“We have a big surplus but not a lot of innovation.”
In the coming days, Steeves said more information will be unveiled on the province’s one-time benefit of $300 that’s meant to help low-income families.
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