Blue books show increase to provincial debt, deficit

Teresa Wright
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Finance Minister Wes Sheridan confident he can balance budget by 2016

Auditor General Jane MacAdam

Last year’s provincial debt ballooned to $2 billion with a deficit that came in $4 million higher than originally budgeted, according to newly released audited financial statements.

But Finance Minister Wes Sheridan says he is still on track to balance the books by 2016.

On Friday, Auditor General Jane MacAdam released the province’s official Public Accounts for the 2012-2013 fiscal year, known as the blue books.

These fully audited numbers show the province’s projected $74-million deficit for the fiscal year ending March 31, 2013, grew to $78 million. This pushed the deficit over $2 billion for the first time in P.E.I. history.

But Sheridan says his deficit didn’t actually increase last year. He explained the province received several million more in revenues through corporate and personal taxes than budgeted. This would have actually lowered the deficit projections for the year.

But when the auditor general was preparing her documents, she would not allow the province to use $25 million it received from the federal government last fiscal year on its books for the year.

This payment was the first installment of a total $39 million in transitional funding to help the province roll out the HST.

“The auditor wanted it all taken in one year and she wanted it all in the year the HST was actually implemented,” he said.

“I had to back $25 million out two weeks ago to do this, which takes us back up to $78-million (deficit).”

That $25 million will now be added to revenues for the current fiscal year, which will, in turn, help to improve this year’s deficit numbers.

Sheridan says this is merely an accounting change — there is no change in actual expenditures as a result of this measure.

“You have to go with the flow with accounting rules, we sure as heck don’t make them, but we abide by them and we make the changes that are necessary.”

As for the province’s $2-billion debt, that’s a matter of grave concern to Opposition Leader Steven Myers.

Every year the province remains in deficit, the net debt grows, Myers said.

“He’s going to pass that down to the next generation, kick the can down the road even further and it’s getting our province nowhere.”

Myers says Islanders also paid $45 million more in taxes, fees and services in 2012-2013 over the previous year.

“That’s over $800 a household in Prince Edward Island. That is scary. And that’s before the HST.”

The province has a three-year plan to return to balance, but has been having trouble meeting its budget targets.

Sheridan has twice had to push back his balance target date. He originally planned to be back in the black by 2014. Now says that will happen in 2016.

In the meantime, Sheridan says he is not concerned about the $4-million adjustment to last year’s deficit.

“The point of the matter is we still were able to come in almost at the number that we had projected,” Sheridan said.

“What it means very clearly is that we’re on track with our three-year plan, and that’s the part that I’m most content with.”

 

twright@theguardian.pe.ca

Twitter.com/GuardianTeresa

Geographic location: Prince Edward Island

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  • More Liberal Lies!
    February 05, 2014 - 15:18

    Great comments by the Observer from the East and Bernie Makenoff below! It is sad to see the provincial debt increase so drastically by Ghiz and his inept and incompetent Finance Minister! I really believe that he believes all the lies that he is telling us!

  • Observer from the East
    February 05, 2014 - 14:11

    Here's the microcosm of the problem with governance on P.E.I. - you can't trust a word Sheridan says, and you can't take a word Myers says seriously. Need new minds in all aspects of government. Until then, we'll have to put up with this

  • Observer from the East
    February 05, 2014 - 14:06

    Here's the microcosm of the problem with governance on P.E.I. - you can't trust a word Sheridan says, and you can't take a word Myers says seriously. Need new minds in all aspects of government. Until then, we'll have to put up with this silly bulls---

    • nitpicker
      February 05, 2014 - 20:08

      Your post sums it up nicely. Simply assuming the Island's financial situation is due to any one government is ridiculous. And that thinking is part of the problem, because the Conservatives will get votes simply because they are not Liberals...not because they actually have any ideas. So nothing changes.

  • Bernie Makenoff
    February 05, 2014 - 13:07

    Mr. Sheridan is incompetent and should have been replaced long and ever ago. If shoes were clues he'd be barefoot. It's obvious the only reason Sheridan remains in charge of the provinces finances is because he does what the Premier and others in the Liberal party tell him to do. He's leaving quite a mess for future generations and at the same time, bleeding the pockets of the middle class with all his wonderful taxes. More of the same old story.

  • Quiet Observer
    February 05, 2014 - 12:04

    So, this means that Wes will have a $39 million one-time "gift' from the Feds to decrease his deficit in 2014, just before the next election. Wes, we are not stupid. We will know to take whatever deficit number you announce for 2014/2015 and add $39 million to get the true figure.

  • candrayo
    February 05, 2014 - 10:38

    Were these men in power educated in our Province…..Is this why we are in such a sad state of affairs? I know Ghiz was….so that explains him….What about the rest??? Is it possible to hire tutors to brush these guys up on NEEDS vs WANTS……RED/BLACK when it comes to the books…probably best to tackle a whole lot of subjects in this Province. But I wonder…….I wonder…..and then I wonder some more…because goodness knows that is all any Islander can do with this government…sit back in WONDER!!! The way they are treating us VETS shows me they will treat anyone in the most inhumane way….no WONDER mental illness is a raging problem! Can people please start questioning the sanity of our government (ALL LEVELS)……PLEASE!!!!

  • Joe Blow
    February 05, 2014 - 10:24

    Can anybody tell me why we should listen to anything Wes Sheridan says? Everything he says is a lie and him saying he will balance the budget by 2016 is another one of those lies. They man can't balance his own cheque book. We need someone outside of our government to come in and do an audit of the finances for this province so we know exactly what the debt is, because I can't believe anything Wes or Bobby say about the debt because of all the lies they have told us in the past. Biggest debt in PEI history....thats something to be proud of Wes!! What a crook!

  • yolanda
    February 05, 2014 - 10:18

    Imagine, this government, (Sheridan) consider it an accomplishment to add 78 mill. dollars to the prov. debt in one year for a total of over 2 billion dollars. Great legacy to pass on. - Hopefully all the companies that got `goodies` are pleased, and that the Premier is enjoying his expensive out of country trips with his `royal` entourage. Meanwhile, shoulders to the wheel, fellow Islanders.