Budget cuts needed now to shrink provincial deficit: PCs, business
No new spending cuts announced in Thursday's update
A fiscal update which featured no new cuts to provincial spending has disappointed those pushing for deficit reductions in Newfoundland and Labrador.
After a tough budget in the spring, the province's finance minister delivered a fiscal update on Thursday that saw lots of numbers, but not much action, according to PC leader Paul Davis.
"It's very different than what we expected to see," he said following Finance Minister Cathy Bennett's presentation. "They absolutely should have found some way to reduce [operational costs]."
The finance minister announced Thursday that the province's projected deficit has shrunk by about $250 million, due in large part to oil prices that have been higher than initially forecast.
But aside from 15 civil service cuts announced Thursday afternoon, Bennett didn't mention any new spending reductions, even if she says government remains, "very committed to addressing the situation that we are faced as a province."
'Missed Opportunity'
In a statement, the province's Progressive Conservative party said the fiscal update was a "missed opportunity."
Speaking to reporters after the update, Davis said the day fell far short of a "mini-budget" or "supplemental budget," like what was promised when Bennett gave her budget speech in April.
"[We were told that] in the fall, they would be talking about how they deal with the unsustainable level of cost of operation of government," he said.
"They haven't done very much of that. They haven't done anything, and today we hear they're not going to do that any time soon."
While Richard Alexander, head of the Newfoundland and Labrador Employers' Council, said the day's news was not a surprise, he said the provincial government needs to starting acting — and soon.
"The province's credit card is getting out of control," he said. "Without significant reductions to government expenditures, we're not going to see things like a removal of the gas tax."
"The longer that they wait, the more difficult the spending reductions … are going to be."
Alexander suggested the province cut from areas other than education and health care — two portfolios that make up a large chunk of government spending.
The St. John's Board of Trade also pushed for action on Thursday, issuing a statement claiming it was "urgent for government to gain control of spending."
Still committed
In her presentation, Bennett said it was important for critics to understand the course that government has laid out — a seven-year path to a surplus budget.
"This is a significant financial situation that we have in our province and it's going to take time for us, to get as a province, working together as a community, to get that problem resolved," she said.
She said the government's resolve to address the deficit was still intact — and that the fiscal situation calls for "thoughtful" decision-making.
The government has promised that Premier Dwight Ball will release a "vision document" soon that is expected to contain new spending cuts.
With files from Peter Cowan