New Brunswick’s expensive travel nurse contracts are having an impact on the province’s bottom line, according to finance officials.
In its first-quarter update, the province is projecting a deficit of $27.6 million this fiscal year, compared to a budgeted surplus of $40.9 million.
It is the first time the province has projected a deficit in nearly four years and, if it holds true, it would be the first recorded deficit since 2017.
Finance Minister Ernie Steeves said total expenses are currently projected to be higher by nearly $124 million
The Department of Health is expected to be over budget by $164 million, with travel nurse costs accounting for $97 million of that.
“We remain focused on how best to manage the remaining travel nurse contract all while continuing to improve patient outcomes and delivering the best health care for New Brunswickers,” Steeves told reporters Thursday.
The Vitalité Health Network is expected to account for $92 million while the Horizon Health Network, which plans to stop using travel nurses this month, will account for around $5 million.
Finance officials said the rest of the health expense overage comes from additional salary and supply costs, particularly within Horizon, and supply pressures including medical and surgical supplies.
Steeves said they need to come up with a solution to solve what he called the “$97-million problem” related to travel nurse costs, but was unable to say what that might look like.
“I don’t know, not yet, but we’ll find a way to solve it and find a way to help New Brunswickers. Health care is key going forward, it absolutely is top on the list of what we need to fix and continue to improve,” he said.
Despite the projected deficit, the minister said he is confident they will have another balanced budget by the end of the fiscal year.
Opposition Liberals respond
The Opposition Liberals say many questions remain following the provincial government’s first-quarter update.
René Legacy said the travel nurse expenses should have been foreseen by the government well before now.
“We just went through a budget process and we questioned it extensively,” Legacy told reporters on Thursday.
“There was a lot of discussion with various departments on these travel nurse contracts and we know now from the auditor general that they had all of the information.”
Legacy said he expects there will be surpluses on the horizon given the government’s track record.
The province has seen significant revenue variances in recent years, leading to larger-than-expected surpluses.
While the finance minister said those variances are returning to more historic levels, Legacy does not believe that is the case.
“This sounds more like a narrative for them to say ‘you need us to be the good managers because troubled times are ahead’ when we know that probably we’re going to see some bigger surpluses coming,” he said, noting that much of the revenue usually comes later in the fiscal year.
