FREDERICTON (CNB) – New Brunswick's deficit is projected to reach $820.4 million for fiscal 2010-11, with the net debt expected to total $9.6 billion, Finance Minister Blaine Higgs informed the legislative assembly today as part of his first economic and fiscal update.

"As a province, we are facing an unprecedented fiscal challenge," Higgs said. "Without corrective action, the deficit could approach $1 billion by next year, and a net debt that could grow to $15 billion by 2015. This is not sustainable."

Higgs said the year-end projected deficit is $71.6 million more than expected. Higgs's fiscal update reported that revenues are up $70.4 million because of anticipated corporate and personal income tax underpayments from the federal government for the 2009 tax year and increased tobacco tax revenue from a one-time tax settlement and higher sales.

However, government spending grew $142 million more than expected last year.

"We cannot allow our future generations to be handcuffed by this unsustainable financial situation," said Higgs. "Our government is confronting the problem with an immediate one-per-cent budget cut between now and the end of March 2011. We realize this cannot solve everything, but we have to start somewhere."

As part of his fiscal update, Higgs encouraged all New Brunswickers to participate in 2011-12 pre-budget consultation process, saying government cannot make all the financial decisions alone.

New Brunswickers are asked to send written or electronic submissions. The Department of Finance is also inviting public feedback through an online questionnaire that will be available on its website in December.

The minister will also visit communities throughout New Brunswick, hosting a series of public forums early in the new year, the details of which will be released shortly.

"As a government, we want to understand the priorities of New Brunswickers and their suggestions on how to directly address this financial challenge," Higgs said. "This may include reducing or eliminating programs or services, changing the way some programs are delivered, increasing revenues or selling assets. Everything is on the table."

The complete text of the minister's speech is online.

LINK:

●    Department of Finance: www.gnb.ca/finance

26-11-10