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Saskatchewan Deficit Might Violate Government's Own Law: Opposition

02/02/2016 03:55 EST | Updated 02/02/2016 03:59 EST
CP

REGINA — The Opposition NDP says the Saskatchewan government is breaking its own law by running a deficit this fiscal year and next.

The Growth and Financial Security Act requires the government to balance the books every year unless there's an extraordinary event such as a disaster that couldn't be anticipated.

NDP Leader Cam Broten notes that the legislation also says if there is a deficit, the government has to offset it with a surplus in the next budget year.

"This is a problem,'' Broten said at the legislature Tuesday.

"What we heard from the premier (Monday) is in violation of their very own law around the need for balanced budgets and their need to be open and honest and transparent with Saskatchewan people.''

"This is a problem."

Premier Brad Wall said Monday that the government is facing a revenue shortfall because of a drop in oil prices and the cost of fighting forest fires last summer.

Wall said there isn't much room for cuts and that left two choices — raise taxes or run a deficit — and the government opted for the deficit.

The Growth and Financial Security Act was the first piece of legislation introduced by the Saskatchewan Party after it won the 2007 provincial election.

Legislation applies to general revenue fund, not summary budget

But the government notes in an email to The Canadian Press that the act applies to the general revenue fund, which was the government's operating expenses and revenues.

Saskatchewan governments used to put forward budgets based on the general revenue fund.

But several provincial auditors said that presented an incomplete and misleading picture of the government's finances because the general revenue fund does not include more than 270 Crown corporations and other agencies. Those are only included in the summary budget.

The Saskatchewan government changed its focus to a summary budget in 2014.

"We do not know how deep this hole is.''

"There have been accounting changes, but if you look at the remarks of the Sask. Party finance minister in committee around this legislation, the spirit absolutely talks about the need to be open and clear with Saskatchewan people, to say what the true state is and we don't know,'' said Broten.

"We do not know how deep this hole is.''

Wall told reporters that summary budgets have changed everything.

"It's our view that there's going to be no problem with the legislation,'' said Wall.

The government email also says if the Saskatchewan Party is re-elected April 4, it will amend the existing legislation to apply to summary financials. It would also change one-year deficits for unforeseen extraordinary events to two years.

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