Finance Minister Donna Harpauer. (Lisa Schick/980 CJME file photo)

By CKOM News

THE DEBT

Saskatchewan reports $1.58B surplus for ’22-23, pays down $1.5B of operating debt

Jun 29, 2023 | 11:48 AM

Saskatchewan’s finances were rosier in 2022-23 than expected.

When the budget for that year was released, Finance Minister Donna Harpauer said the province would have an operating deficit of $463 million. In the Public Accounts document released Thursday, the province reported an operating surplus of $1.58 billion — a $2.04-billion improvement over the budget.

The surplus also represented a $3.05-billion improvement from the operating deficit reported in the previous year.

“Significant increases in non-renewable resources revenue and continued post-COVID economic recovery combined with lower crop insurance payments when compared to the prior year help contribute to the Government’s improved fiscal results for the year,” the report said.

The government said the $1.58-billion surplus allowed it to pay off $1.5 billion of the provincial operating debt, saving $66 million per year in estimated future interest costs.

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“Saskatchewan led the country with 5.7 per cent GDP growth in 2022 and is experiencing continued economic growth so far in 2023,” Finance Minister Donna Harpauer said in a media release. “As a result, in 2022-23 Saskatchewan experienced strong revenue from our resource sector and from corporations achieving success in our province.

“We were able to help Saskatchewan residents and businesses with affordability in 2022-23, with $500 Saskatchewan Affordability Tax Credit (SATC) payments, keeping gym and fitness memberships and recreational activities for youth PST exempt, extending the small business tax rate reduction, and retiring $1.5 billion in operating debt, which when combined with lower borrowing, is resulting in lower interest costs this year and into the future.”

Revenues were $3.44 billion higher than expected in the budget, at $20.6 billion. According to the government, that increase was due in part to high oil and potash prices as well as higher corporate income tax, personal income tax and provincial sales tax revenue in 2022-23.

Non-renewable resource revenue was $4.60 billion in 2022-23, the government said. That represented an increase of $1.69 billion (or 58.2 per cent) over what was forecast in the budget.

Taxation revenue was $9.81 billion in 2022-23, an increase of $1.72 billion (or 21.2 per cent) from the budget.

The government said the revenue increases were partially offset by a decrease in net income from Government Business Enterprises, caused by increased costs for power generation and a decline in investment returns.

Total expenses for the year were $1.39 billion higher than forecast in the budget, at $19 billion.

“Agriculture expense saw the most notable impact as drought conditions significantly improved in parts of the province resulting in crop insurance payouts lower than the prior year but greater than budget,” the report said, noting the drought in the southwest was a major factor.

“Additionally, economic development expense increased as a result of the Saskatchewan Affordability Tax Credit payments made to residents in recognition of rising costs from inflation.”

The government said those cheques totalled $422.7 million.

The government said its overall financial position as of March 31 of this year is an accumulated deficit of $1.60 billion.