18 March 2015
Balanced Budget Keeping Saskatchewan Strong
Today, as Finance Minister, I had the privilege of tabling a balanced budget that’s about keeping our economy and our province strong. The 2015-16 Saskatchewan Budget controls spending, doesn’t raise taxes, and includes continued investments in much-needed infrastructure projects like highways, schools and health facilities. Health, Education, and Social Services account for nearly three-quarters of all spending. The overall increase in those areas is just under two per cent. All other areas of government combined are budgeted to spend 0.6 per cent less.
In addition, Saskatchewan’s Active Families Benefit, Graduate Retention Program, Research and Development Tax Credit, Seniors' Drug Plan and the Saskatchewan Employment Supplement are being changed to ensure their ongoing sustainability.
Strength in the potash industry and a change in the Potash Production Tax will help offset the $661 million decline in oil revenue from last year's budget due to the falling oil price. The total tax deduction potash producers receive from their capital spending will now be used over a longer period of time. As a result of this change and overall growth in the industry, potash revenue is expected to be up by nearly $400 million this year. The change was made following consultation with the potash industry, which continues to show tremendous confidence in Saskatchewan through major capital expansions.
In addition to no tax increases, Budget 2015-16 contains no reduction in revenue sharing with municipalities, which could have contributed to higher taxes at the municipal level. It provides $265.3 million in revenue sharing – the largest grant ever provided to municipalities – an increase of $8.3 million compared to last year, and an increase of $138 million or more than 108 per cent, from the 2007-08 budget.
As Saskatchewan's population continues to grow, so too does its infrastructure and capital needs. This budget begins a four-year, $5.8 billion commitment – the Saskatchewan Builds Capital Plan – to construct and maintain needed infrastructure such as schools, health care facilities, municipal infrastructure, roads, bridges and highways. Within the four-year plan, Budget 2015-16 provides more than $1.3 billion for core infrastructure in 2015-16, the largest infrastructure allocation in Saskatchewan's history and an increase of almost 50 per cent from last year. This investment is in addition to $2.0 billion in capital investment forecast this year by the commercial Crown corporations — largely SaskPower, SaskTel and SaskEnergy.
Budget 2015-16 creates two new growth tax incentives to encourage job creation and capital investment. The new Manufacturing and Processing Exporter Tax Incentive will provide tax credits to eligible exporting corporations that increase their number of full-time employees who do work typically considered to be head office functions. In addition to the traditional manufacturing and processing sector, the incentive will also apply to corporations involved in the commercial development of new economy products – including interactive digital media and creative industry products.
The second new tax incentive is a rebate for primary steel production, supporting the Growth Plan commitment to encourage new capital investment. The rebate will provide a tax incentive for eligible primary steel producers that make a minimum capital investment of $100 million in new or expanded productive capacity.
The 2015-16 Budget also provides incremental investments to help develop a skilled workforce, ensuring it has the skills needed to fill the job opportunities in Saskatchewan.
The 2015-16 Budget provides $5.5 billion in total spending for health care, up 1.1 per cent from last year, as well as $3.7 billion for education spending, up 2.8 per cent over last year's budget. Investments in social services and assistance will reach $1.2 billion in this budget, an increase of 3.2 per cent over last year's budget.
There is no doubt this is a challenging budget, but the good news is Saskatchewan has never been in a better position to meet this challenge. Our economy is more diversified than ever before, more people live here than ever before, exports are at an all-time high and businesses continue to show tremendous confidence in Saskatchewan's future through major capital investments. Our diverse economy and this balanced budget will keep Saskatchewan strong.
For more on the 2015-16 Saskatchewan Budget visit saskatchewan.ca/budget.
Saskatchewan Keeps Growing
New figures from Statistics Canada show Saskatchewan’s population grew by another 17,396 people in 2014, reaching an all-time high of 1,132,640. This continued growth is a big change from a decade ago when so many young people were leaving and our population was declining. This was the eighth straight year that our population has grown by more than one and a half per cent – the strongest period of population growth since the early days of our province.
Saskatchewan’s Unemployment Rate Remains Lowest in Canada
Saskatchewan is fortunate to have an economy that is diversified with the strength of potash and agriculture expected to bridge the gap caused by a downturn in the oil sector. In February, our province maintained Canada’s lowest unemployment rate with job numbers up slightly year-over-year. Quality job opportunities across the province – with more than 10,000 positions posted on SaskJobs.ca – are also a good sign employers are still looking for workers.
Manufacturing Figures Up
New statistics show Saskatchewan’s manufacturing sales were up 4.8 per cent in January, highest among the provinces, reinforcing our optimism that Saskatchewan is on the right track. The manufacturing sector has been key to diversification, ensuring economic strength despite the cyclical nature of commodities. The measures our manufacturers have undertaken to enhance productivity have positioned Saskatchewan as a national leader in the sector.
If you have a question about this Legislative Report or any other matter, just Contact Ken.
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