The provincial budget was released Wednesday and was highlighted by an increase in spending, particularly health, an expansion of the PST to cover ticketed events such as concerts and movies, and a deficit of just over $400 million. With the reduction of the deficit, Finance Minister Donna Harpauer said during the budget's release that Saskatchewan was getting back on track, economically speaking.
“Budgets are a really great proxy to be able to get a feel for how the overall, or general economy, are going,” said Golden West business commentator Paul Martin. “Government revenues are in large measure a reflection of the success, or lack of success, of an economy.”
Martin added that government revenue is very dependent on economic activity, with things such as tax revenue and resource royalties going up when the economy is growing.
It was noted, however, that the estimates from the provincial government are more conservative on how the economy is growing compared to how the major banks are looking at Saskatchewan’s growth.
“The Royal Bank would probably be the most optimistic about Saskatchewan – they have us at 5.7 percent growth,” Martin said. “This budget has us at 3.7 from the government.”
You can hear the complete conversation with Martin below: