Sep 13, 2012 / 1:00 pm
Finance Minister Mike de Jong says government spending cuts are on the way as the province faces a growing budget deficit due to historically low natural gas prices.
In delivering his first quarterly report since becoming finance minister last week, de Jong said declining natural gas revenues have put a dent in the province's bottom line.
A gigajoule of natural gas is now priced at $2.20, down from $7.58 in 2005, de Jong said, adding wryly that bad news for the province's finances includes a silver lining.
"We're almost at a point where it is difficult to imagine gas prices dropping any further," he said Thursday.
The government had forecast natural gas revenues of $1.9 billion over three years, but now forecasts a drop to $1.1 billion.
A government-wide hiring freeze will be implemented to make up for the $800 million loss, de Jong said.
As provincial finances dwindle, he said the government is reviewing its bargaining positions with public sector unions, some that have already staged a one-day strike to back demands for more money.
The government is required by law to deliver a balanced budget in 2013-14.
De Jong said the deficit for this year's budget is now forecast at $1.14 billion, up $173 million from earlier forecasts.
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