The provincial deficit is now $2.1-billion, up more than double the projected deficit in the last budget. However, government sees a silver lining in that the increase in its deficit is less than the increase in many other provinces.
The net debt is over $17-billion. Oil revenue declined by $560-million, and Terra Nova field is now expected to be shut down for the full year instead of six months.
(Chart courtesy Government of Newfoundland and Labrador.)
Health care costs went up by $261-million, mostly either directly or indirectly related to COVID-19.
Nalcor’s revenue dropped by about $225-million because of the oil situation.
Borrowing will increase by $2-billion to $3.2-billion.
Expenses are up primarily because of COVID-19 relief programs.
Finance Minister Tom Osborne says Muskrat Falls continues to drag the province down. He says the net debt is a problem decades in the making and compounded by an ill-advised Muskrat Falls project.
The Minister added that the bond rating agencies have routinely commended our province for the measures we have taken.
