Recently, political columnist Murray Mandryk wrote in this paper about provincial debt.
I thought it reasonable then to offer these additional facts.
Much like some households, the Province of Saskatchewan has two ‘kinds’ of debt. The first is aptly described as operating debt. It is used to cover revenue shortfalls and not tied to a particular asset. It’s like credit card debt. The second is debt tied to specific assets, like a mortgage. Clearly, the latter is much more acceptable than the former.
During our time in office we have paid $700 million off of Saskatchewan’s credit card debt so that operating debt is now $700 million less than when we were elected. It’s true that many long term projects that have been built or rebuilt in Saskatchewan over this last decade of growth, both in government proper and in the crowns, have used long-term financing. Crown corporations like any large utility corporations use debt to finance infrastructure renewal and expansion. These were very essential and important investments made by our government after inheriting a situation of massive infrastructure deficits, especially in the crowns.
And then there were the major projects built, such as 40 new and replacement schools, new long- term care facilities, a Children’s Hospital, new hospitals in Moose Jaw and Humboldt, record highways investments and the list goes on.
After all of that investment, Saskatchewan finances are still stronger than what we inherited.
At the end of the decade of growth through which I had the honour of serving:
- $700 million of unsupported operating debt paid off
- First ever AAA credit rating for Saskatchewan’s finances, maintained through the last four years of significantly reduced resource revenue
- the second lowest net debt-to-GDP ratio among all provinces
The last budget I was part of laid out a three-year plan to get to balance, notwithstanding dramatically lower resource revenue. Congratulations to Premier Scott Moe and Finance Minister Donna Harpauer for continuing with, and in fact strengthening that plan.
I note that this week’s first quarter budget report shows the government is on track with it’s plan to get to balance and it also shows lower debt.
While so many other provinces are choosing massive operating deficits with no credible plan to balance, we chose to meet the challenge and keep our finances and our province strong.