P.E.I. Liberal MLAs handed Provincial Treasurer Wes Sheridan a standing ovation for a fiscal update that still includes an $85.4-million deficit.
Despite a drop in revenues, Sheridan said the province remains on track to meet its budgetary projections set out last April. He said P.E.I. is one of the only jurisdictions in the country to meet its fiscal targets.
“As we all know, there are jurisdictions across this country that are millions and, in some cases, billions of dollars off their budget targets for this fiscal year,” Sheridan said at Province House.
But Opposition finance critic Jim Bagnall said back-to-back deficits, amounting to more than $113 million is nothing to brag about.
“It’s unbelievable that government members would stand up and give a minister a standing ovation for coming in and telling us for two years he’s going to have $113 million in deficit,” Bagnall told The Guardian.
“They’re spending like drunken sailors.”
In a fiscal update released Friday, Sheridan said revenues have dropped by $1.6 million.
But the province has managed to tighten its belt to cover the revenue shortfall, mostly through lower interest charges on the Island’s debt.
However, the road to balanced books will be a long and winding one.
The province said it will be 2012-13 before it can balance the books.
To reach that goal, Sheridan is looking at creating a much smaller public service. He assures those who work for the province there will be no job cuts and no wage rollbacks, describing those as ‘drastic and draconian measures.’
But the public service will not grow at rates it has in the past, he added.
“We have about 22 per cent of our civil service that are eligible to retire in the next 18 months,” he said.
“It allows us to look at what is really important to this government. What are the key priorities inside our government and how we can structure our civil service to go forward into the future in a very efficient and effective manner.”
Sheridan issued a thinly-veiled warning to the public service that they’ll have to be part of the solution. He wouldn’t say what percentage of the 22 per cent of potential retirees will be replaced.
“In the past 18 months, the brunt of this downturn has been on the private sector,” said Sheridan.
“That’s not coming from a government agency. That’s APEC and the Conference Board of Canada stating that and we’ve seen it.
“It’s at a time like this where we would ask that the public service would understand that, and that it may be time to put their shoulder to the wheel as well and kick in and spread the hurt across all
sectors as we come out of this downturn.”
But Bagnall said while the provincial Liberals are talking about creating a smaller public service, they are doing the exact opposite.
“This government has added 2,000 people to
the public service,” said Bagnall.
“The government has hired more spin doctors than medical doctors. There is five spin doctors in the Department of Health for that minister.”
The deficit for 2008-09 of $47.4 million came in better than forecast at about $33 million.
Those figures are contained in the so-called Blue Books or the Public Accounts for the province, which were also made public on Friday.
Sheridan said the province will come down with its capital budget next week.
He said Islanders can expect more big spending.
The province is planning three years of stimulus spending, followed by two years of ordinary spending. Stimulus spending can be expected this year and again next year.
The capital budget comes down next Friday.
“We cannot take a chance of losing the momentum that has
been gained now as the economy starts to grow,” he said.