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Premier Brad Wall sees tighter budget belts in Saskatchewan's future

REGINA - Saskatchewan Premier Brad Wall is already trying to manage expectations ahead of the next provincial budget.

At a news conference to boast about Saskatchewan's population growing to 1,114,170 people, Wall warned that just because the economy is good, that doesn't mean provincial coffers will be rolling in money.

"I think people think, 'Well, if the economy's strong, the provincial budget must be flush and revenue must be strong.' In Saskatchewan, that's not always the case," Wall said Wednesday at the legislature.

"The most important thing is that the economy is continuing to be strong, but we're heading into a year where it's going to be tighter financially and the budget's going to reflect that, so when that happens in the spring people ought not to think, 'Well, this reflects badly on the economy.'

"We've been there before in 2009 when we grew by 17,000 people but our potash revenues virtually collapsed."

Potash is mined and used primarily as an ingredient in fertilizer. Saskatchewan collects billions in revenue from taxes and royalties from companies that mine the resource.

But demand for potash softened and prices fell this year after Russian-based Uralkali, one of the world's largest potash producers, quit an export partnership. China and India — key markets for fertilizer — then delayed purchases in expectation of lower prices.

The province said in its mid-year financial update in November that potash revenue is projected to drop by $107.2 million from the budget forecast.

Wall says the government will make sure the budget is balanced next March. It will try to keep spending in the three per cent range, he said.

"That represents some significant decisions that we're going to need to make, to make sure we hold it at three per cent," said Wall.

"Maybe not cuts, but we're certainly not going to be expanding a lot of programming, I wouldn't expect that, and if we can find efficiencies in existing programming, we would do that," he added.

Wall made a similar warning last February before the budget was tabled in March. He said then that Saskatchewan's economy was still doing well, but that the economy and the budget are not always the same thing.

The Canadian Press

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