The audited financial statements for 2013-14 show that the deficit grew to $678.9 million, nearly $200 million from what was forecast in December, and the net debt climbed to $14.8 billion.
Finance Minister Diana Whalen blamed the higher-than-expected deficit on an unanticipated drop in revenues, higher departmental expenses and a one-time adjustment to the public service pension plan.
"A lot of this, as large as it is and as concerning as it is, is actually related to events that were out of the control of any government," said Whalen, citing a drop in personal and corporate income tax, as well as the harmonized sales tax, which together make up the bulk of provincial revenues.
Total expenses for the fiscal year ending on March 31 were $10.8 billion, about $460 million more than estimated.
This increase was primarily due to a one-time $318.9-million pension valuation adjustment. But it also included a $69.7-million rise in departmental expenses driven by environmental remediation projects, increased caseloads within the Community Services Department and higher snow removal and salting costs during an abnormally harsh winter.
Whalen pointed to an internal program review being led by Premier Stephen McNeil as proof of the government's commitment to identify possible cost-saving opportunities.
"We are trying to examine what we're doing and look for better ways to do it," she said. "We want to become a leaner government."
Whalen would not rule out tax hikes, but she did express concern when asked about the possibility of spending cuts.
"You can't just cut off services to people if they're in need," she said.
The province's opposition parties accused the government of lacking direction.
"People are tired of hearing about governments studying things," said Tim Houston, the Progressive Conservative finance critic.
"We need to see governments take some action. … We need results now, in the present."
Whalen recited as reasons for optimism what sounded like a familiar refrain: the shipbuilding project, Halifax's new convention centre, the Maritime Link and offshore exploration. In the latter months of the previous government's mandate, the NDP listed the same developments as cause for hope.
Interim NDP Leader Maureen MacDonald said the projects were already in place prior to the Liberal party's ascension to power eight months ago.
"This government has no plan," said MacDonald. "This government hasn't created any jobs itself yet."
The Liberals were elected in October of last year, taking over from the NDP partway through the fiscal year.
The New Democrats originally forecast a $16.7 surplus for 2013-14, which was soundly rejected by the Liberals when they released an updated budget forecast in December projecting a deficit of $481.1 million.
While the overall debt for 2013-14 climbed by $819 million, Whalen drew attention to the debt-to-GDP ratio, a key indicator of economic health, which had risen only slightly compared to the year prior, from 36.3 per cent to 37.8 per cent.
Whalen did not proved any update on the budget projections for 2014-15, which were released in April and projected a deficit of $279 million.
She said the government intends to return to a balanced budget in four years.
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