N.B. Projects $183M Deficit For 2020-21

The impact of COVID-19 on New Brunswick’s finances has improved slightly from previous projections, according to new numbers from the province.

Second-quarter results released Thursday show a projected deficit of $183.3 million for the 2020-21 fiscal year.

That is down from the $299.2-million deficit projected in May, but a far cry from the $92.4-million surplus budgeted before the pandemic.

“Second-quarter results show that we are facing a situation unlike anything we have experienced before,” said Finance Minister Ernie Steeves in a news release. “We must continue to be responsible fiscal managers to safely restore and grow our economy and put New Brunswick back on the road to prosperity.”

Revenue is projected to be $40.3 million lower than budgeted while expenses are projected to be $235.5 million higher than budget.

According to the province, most of the extra expenses are offset by federal revenue from COVID-related programs, including the Safe Restart Agreement, the Safe Return to Class Fund, and the essential workers wage top-up.

The net debt is projected to increase by $146.1 million and reach nearly $14.1 billion. The province had been hoping to pay down $129.3 million in debt before the pandemic hit.

Meanwhile, the Department of Finance projects the provincial economy will contract by 4.3 per cent this year. By comparison, the Canadian economy as a whole is expected to contract by 5.7 per cent, according to the Bank of Canada.