In a briefing with reporters on Friday, Finance Minister Allan MacMaster announced that his department will close the books for the 2021-22 financial year with a surplus of $351 million. That’s a far cry from the $585 million shortfall estimated when the previous Liberal government presented this budget plan in March 2021. It’s also better than the $108 million surplus forecast last December. MacMaster told reporters the change reflects “our province’s stronger than expected economic recovery in 2021, coming out of the COVID 19 pandemic.” “Nova Scotia had less economic contraction in 2020 and stronger growth in 2021 than most other provinces,” he said. The figures also show that revenue totaled $1.3 billion above initial budget estimates “primarily due to improvements in tax revenue, offshore license seizures, investment income, as well as federal recoveries and other federal transfers.” In fact, the province was able to post a “prior year adjustment” of $389 million. This is a reconciliation of many figures, including the tax collection between the projected and the money actually collected. Prior year adjustments are difficult to predict and can vary widely from year to year.
The surplus is a surprise, says the minister
MacMaster said there was no way his department would have predicted the adjustment windfall this year. “I guess we could say, based on our experience last year, maybe we’ll have more revenue this year than we’re projecting, but until we have actual data to show us that, we prefer to use the data because otherwise we could let’s get a crystal ball,” he said. But NDP finance critic Lisa Lachance doesn’t take issue with the minister’s claim, who only learned of the change a few weeks ago. The MLA for Halifax Citadel-Sable Island called the latest budget “a missed opportunity.” “Nova Scotians are fighting,” Lachance told reporters after the briefing. “They’re working harder than they’ve ever worked before. NDP finance critic Lisa Lachance said the government could have done more with the budget surplus to help Nova Scotians. (Jean LaRoche/CBC) “It’s clear that the government had the flexibility to provide support, to do some things that could make a real difference in the lives of Nova Scotians, and they didn’t, and they continue to choose not to.” Liberal economic critic Fred Tilley offered a similar view. “Certainly the government knew it had a surplus – given that it may not have known exactly how big – it knew there would be a surplus,” the MLA for Northside Westmount said from his North Sydney office. “They should have helped Nova Scotians get through this cost of living crisis we’re in today.” Asked why Houston government hasn’t done more to help individuals and families struggling with higher costs given the size of the surplus, MacMaster responded with a rhetorical question. “Would we spend more if we had it?” he said.” It’s really a question of — we didn’t have the money at the time, we didn’t think we did. “So we’re not going to make decisions if we don’t have the information, good information to get it. And yes, we’re reporting a bigger surplus today, but we didn’t know that in the spring.” Along with higher-than-projected revenues, the province also saw higher-than-projected expenses. Total spending was $386.3 million above estimates, an increase largely due to additional spending by the Department of Health and the Department of Aging and Long-Term Care related to the COVID-19 pandemic, more funding from the Department of Advanced Education for university infrastructure and increased transport in municipalities.
