Greater autonomy for MUN, NLESD to be folded into Department of Education, review of Nalcor among highlights of today’s budget.
The provincial government has started the process to implement immediate measures to try to curb spending and increase revenue, in order to return to surplus by 2026-27.
The province is borrowing $1.7-billion—down from the $3-billion borrowed last year.
Government officials say the province encountered “no problems” with borrowing this year, calling last year’s difficulties “a blip.”
Tax increases are being introduced effective January 1, 2022, for some of the province’s highest-earning residents. People who fall under the $135,973 tax bracket will see no change, but those earning more than that will see increases—the most significant of which will be among the very highest earners.
Tax on Sugary Drinks
A new 20 cent per litre tax will be introduced on April 1, 2022, on sugary drinks—but which beverages will be affected have not yet been identified.
Taxes on cigarettes and tobacco products are going up immediately by three cents per cigarette and six cents per gram of fine cut tobacco.
That will bring tobacco taxes on par with British Columbia which has the highest tobacco taxes in the country.
Crown Corporations Go Under the Scope
Government is starting the process of analyzing and reorganizing Nalcor, but there’s no specific detail on if, or when, the Crown corporation could be dissolved.
While “no major job losses” are anticipated, other Crown corporations will be merged into core government, beginning with the NL Centre for Health Information and NL911. Steps will be taken to integrate the English School District into the Department of Education so that spending is targeted on the classroom and not administration.
Corporate services will be integrated to help streamline functions of the four health authorities, involving payroll, finance, accounting, human resources, IT, and procurement. A full review of the delivery of health services will be considered through the Health Accord.
Tuition Freeze Under Slow Thaw
Greater autonomy will be provided to MUN through amendments to the Memorial University Act with the elimination of the university’s annual tuition offset over the next five years. While government is maintaining current funding levels to MUN in this budget, that model will be different next year.
Certain assets will be reviewed including NLC, Marble Mountain, and offshore oil and gas assets.
What are being called “joint solutions” will be explored for service delivery including ferry services, property management, and provincial registries.
Budget Sets Healthy Living Initiatives in Motion
Some initiatives are being introduced focused on healthy living.
A new physical activity tax credit is being introduced—providing up to $2,000 per family. The credit, estimated at a total of $7-million is intended as an incentive for families accessing sport and recreational activities while providing benefits for the health and wellness industry.
$6.3-million is being provided to support recreation, physical activity as well as athlete and sport development, while $3-million is being provided to support the capital city in hosting the 2025 Canada Games. $1-million is being provided for upgrades to the 40-year-old Aquarena and MUN’s Field House in preparation for the 2025 Canada Games.
More Support for Hard-Hit Tourism Industry
(Still image from provincial tourism campaign by Target Marketing.)
$30-million is being provided for a new Tourism and Hospitality Support. The sector has been especially hard hit by the pandemic and COVID restrictions. Another $13-million is being provided for tourism marketing.
$10-million is being provided for the Film and Television Equity Investment Program, while $5-million is being maintained for ArtsNL and $3.3-million will be provided for the Cultural Economic Development Program.
