2010-11 Budget Overview

Department of Finance (to Oct. 22, 2013)

April 6, 2010 2:25 PM

The province of Nova Scotia is tabling a budget in fiscal 2010-11, with a deficit of $222.1 million. This is the first year of a four-year fiscal plan to return to a balanced budget.

Total revenues for 2010-11, including government business enterprises' net income of $348.6 million, are projected to be $8.7 billion, an increase of $327.8 million over the 2009-10 estimates.

Provincial source ordinary revenues are estimated to be up $409.9 million offset by a $82-million decrease in federal source ordinary revenues. Other revenue sources including fees and other charges, recoveries, and sinking fund earnings are up $8.2 million.

Provincial source revenues have increased primarily as a result of increases in HST revenues of $231.6 million, income taxes of $137.1 million, tobacco tax of $24.8 million and petroleum royalties of $22.6 million offset by a $10.6 million decrease in the Large Corporations Tax.

Federal source revenues are down from the 2009-10 estimates due to decreases in equalization payments of $104.2 million and a decrease in the crown share adjustment payment of $45.9 million, offset by increases in the amount accrued for the Offshore Agreement of $47.2 million and increases in the Canada Health and Social transfers of $27.9 million.

Total expenses for fiscal 2010-11, before consolidation adjustments are budgeted at $9 billion, down $49.7 million from 2009-10. Increases in program spending for departments include: Health $212.7 million; Education $30.2 million; Community Services $25.7 million; Service Nova Scotia and Municipal Relations $12.1 million; Transportation and Infrastructure Renewal $23.0 million; and Labour and Workforce Development $22.1 million. They will be offset by a decrease in assistance to universities of $395.2 million.

A Change and Innovation Fund has also been established in Treasury Board, with an estimate of $15 million. This fund will be used to incent change and encourage departments to consider efficiencies and innovative ways of achieving their business and service objectives. It also includes $3 million for the Emergency Department Protection Fund and $2 million is related to the government commitment on community schools.

Spending has increased for tax credit and rebate programs, which includes $52.5 million for the Affordable Living Tax Credit and $2.3 million for the Poverty Reduction Credit.

Restructuring costs, a portion of which is for funding of wage negotiations, is down $67.4 million from 2009-10.

Pension Valuation adjustment has decreased by $80.5 million from the 2009-10 estimate of $89 million as a result of changes to the pension plans.

Debt servicing costs are up $70.1 million as a result of an increased borrowing program.

Authority for the annual cost to acquire provincially owned assets is reflected in the tangible capital assets appropriation. Gross capital purchase requirements in 2010-11 total $579.9 million, which includes an investment of $310 million in the highway system, $190 million for buildings, including schools, $42.6 million for information technology, $23.2 million for vehicles and equipment, and $14.1 million for land and land improvements.

In addition, capital funding has been provided to the following government units: $96.2 million for the district health authorities and IWK Health Centre, and $34.5 million for the Housing Development Corporation to leverage federal cost sharing for social housing projects.

GETTING BACK TO BALANCE -- LIVING WITHIN OUR MEANS

-- Of the $1.4-billion fiscal gap identified by the Expert Advisory Panel, in 2012-13, $1.1 billion will be eliminated through expenditure management and restraint.
-- Spending growth will remain relatively flat due to aggressive savings targets, adding up to about $772 million by 2013-14.
-- A comprehensive analysis of all department, agency and third-party spending will be undertaken to identify cost-control and cost-saving opportunities.
-- In the health sector, opportunities will be looked at in areas such as health authorities shared efficiencies, streamlined health-care services, and drug costs
-- In the education sector, we will investigate savings through: a modernization of the school system and opportunities tied to student enrolment decline
-- Government will rely on attrition achieved through retirements and voluntary departures to make the civil service 10 per cent smaller by 2013.
-- The Legislative Expenses budget line has been reduced by $1.3 million to reflect the new level of more accountable MLA expenses.
-- Effective July 1, Harmonized Sales Tax will be restored to 15 per cent, providing an additional $214.8 million in revenue this year.

MAKE LIFE MORE AFFORDABLE
-- The new Affordable Living Tax Credit, worth $70 million annually, will lessen the impact of the HST restoration to make life more affordable for Nova Scotian households with low or modest incomes.
-- Households earning less than $30,000 will receive quarterly payments, similar to the existing GST credit. This credit will return about $240 per person and $57 per dependent child every year. Those earning up to $34,800 will also receive a portion of the credit.
-- A new point-of-sale rebate will remove the provincial portion of the harmonized sales tax on children's clothing, footwear, feminine hygiene products and disposable diapers. This means approximately $11 million will be returned to families in every region of the province.
-- Seniors who receive the Guaranteed Income Supplement will no longer have to pay provincial income tax. This means about $12.5 million will be returned to about 18,000 senior citizens across the province.
-- The new Poverty Reduction Credit will return about $3 million annually to about 15,000 individuals.
-- Patients who need treatment not available in Nova Scotia may be eligible to receive up to $1,000 for round-trip travel costs and $1,500 for accommodations for up to 12 medical visits a year.
-- Low-income homeowners will benefit from an investment of $2.5 million to help improve the energy efficiency of their homes and reduce their energy bills over the long term.
-- $128 million will be invested in building affordable housing units and upgrading existing ones across the province.

BRING BETTER HEALTH CARE FOR YOU AND YOUR FAMILY
-- To reduce wait times for surgery, an investment of $1.3 million will set up pre-hab teams to work with patients prior to surgery. This initiative will ease the stress on the health-care system.
-- A $3-million ER protection fund will improve service and access by implementing initiatives identified by the province's Emergency Care Advisor on Emergency Care.
-- Government will spend $4.8 million to help patients move faster through the ER to admissions by opening hospital beds and establishing a Rapid Assessment Unit.
-- Nurse practitioners will be placed in nursing homes to augment care, save money and relieve pressure in other areas of the system.
-- Self-managed care allowances and personal alert assistance programs will be implemented for seniors at home.
-- Transition houses and women's centers will be provided with an additional $500,000 this year.
-- Recreational, cultural and life-skills programming will be provided for youth through an investment of $240,000 annually in after school Lighthouse programs.

CREATE SECURE JOBS AND GROW THE ECONOMY
-- Total capital investment is forecast to be $710.6 million.
-- Stimulus investments are expected to create 7,000 person-years of employment, generating about $300 million in income.
-- The province will contribute $33 million to support infrastructure projects at our universities and the Nova Scotia Community College.
-- Provincial funding is leveraging $56 million from the federal government and $41 million from other sources under the federal Knowledge Infrastructure Program for a total of $130 million.
-- To improve road safety, government is adding $400,000 annually to enhance bridge and truck inspections.
-- The Manufacturing and Processing Investment Credit will put $25 million back into business by boosting innovation and productivity in the province's manufacturing and processing sectors, particularly in rural Nova Scotia.
-- Effective Jan. 1, 2011, the small business tax rate will be reduced by 0.5 per cent, which will save small businesses $500,000 this year and $6 million in 2011-12.
-- The Equity Tax Credit put in place earlier this year is expected to provide $1.1 million in new incentives to support Nova Scotian enterprises.
-- Government will create 250 new seats at the Nova Scotia Community College targeted to high demand trades and professions.
-- A tax rebate of up to $15,000 over six years will be provided for university graduates and up to $7,500 for college graduates. This rebate is being provided for those who stay and work here at home, returning about $17 million into the hands of Nova Scotia's best and brightest.
-- $2 million will help support and invest in community schools.
-- $4.4 million will be spent completing the broadband project, providing high-speed access to all areas of the province.
-- An investment of about $24 million will go towards energy conservation and programs for energy efficiency.

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For further budget information, see the Department of Finance website at www.gov.ns.ca/finance .