Further to previous post on Saskatchewan Finances: What do you do when revenues are rising by at least 7.7 per cent and are better than ever?
The government did not touch the $887 million in its fiscal stabilization fund "saving account"but Thomson said it will be drawn down by several hundreds of millions of dollars in the budget.
"The Public Accounts close the books on a very difficult year for the Saskatchewan economy," Cline said. "The combination of drought, falling commodity prices and the global economic downturn meant provincial revenues tapered off from the dramatic growth shown in 2000-01. Lower revenue from oil and natural gas was offset in part by higher federal transfers. Corporation Income Tax revenue was also less, due in part to the economic slowdown but also to the backlog in processing on the part of the federal government and the reduction in rates for small business."
Cline said the eighth consecutive balanced budget underlines the importance of having a 'rainy-day fund' in the form of the Fiscal Stabilization Fund. "The year-end financial results for 2001-02 highlight an improvement in revenues over what was forecast in the 2002-03 provincial budget. Combined with careful spending, this meant that $131 million less was required than forecast from the Fiscal Stabilization Fund to balance the budget for 2001-02. This leaves us better positioned to meet the challenges for the 2002-03 fiscal year and beyond."