March 20, 1997
(Finance)
Budget 1997/98 - Highlights
A Plan to Live Within Our Means.
- The 1996-97 deficit is less than
predicted. At $29.2 million it is the lowest deficit since 1965-66 other
than for 1995-96 which benefited from one-time revenues.
A three year financial plan, with a
balanced budget forecast at the end of this period.
A modest budgetary requirement of $20.3
million in 1997-98.
A contingency of $30 million provided as
a reserve against unforeseen variances which may arise during the year.
Current account expenditures have been
decreased by $69.2 million from 1996-97 levels through operational
efficiencies achieved in Government restructuring and other measures.
There are no tax increases in this
budget.
Harmonization of the provincial and
federal sales tax systems will reduce taxes by more than $100 million a
year.
$7.6 million has been allocated to
implement a provincial sales tax credit of $40 per adult and $60 per
child. This will be phased out as family income exceeds $15,000 per
annum.
This Budget makes a significant
investment towards addressing Government's pension obligations by
committing payments of $196 million, $113 million and $123 million
respectively in each of the next three years as one element in a pension
reform strategy which will require the cooperation of our employees.
The size of the Public Service will be
reduced by 1,100 full time equivalent positions over the next three
years as a result of budgetary actions. A $2 million Labour Force
Adjustment Fund has been created to assist displaced workers and a $10
million voluntary departure program has been introduced.
Total capital spending in 1997-98 will be
$285 million including Municipal Capital Works, the Canada-Newfoundland
Infrastructure Program, Phase II and the St. John�s Health Care
Corporation. $77 million for roads construction is also included in this
total. This is expected to create well in excess of 3,000 person years
of employment.
Putting Social Programs First
Health Care - Our First Priority
- The existing three year commitment to
stabilize funding in the health care sector is extended to 1999-00.
Enhanced funding is provided for a number of new initiatives.
$2.6 million has been allocated to retain
and attract physicians to rural areas.
Construction will begin on the new
Janeway Child Health Care Centre. Major renovations will go ahead at St.
Clare's Hospital as part of a three year, $100 million construction
program.
$7.8 million is allocated over the next
three years for a new hospital at Harbour Breton.
In cooperation with Voisey's Bay Nickel
Company and INCO, construction and equipping of a new Lake Melville
Hospital, at a total investment of about $30 million.
$4.5 million for the James Paton Memorial
Hospital, for redesign and construction in 1997-98. The next phase of
construction will start in 1998-99.
$2.5 million will be provided in addition
to the annual allocation of $4.5 million for hospital equipment.
$500,000 contribution to establish a
neurotrauma research fund.
Preliminary planning will be undertaken
for health care facilities at Bonne Bay and Stephenville as part of a
western region health care needs assessment.
Renal dialysis services will be provided
at the Central Newfoundland Regional Health Care Centre in Grand
Falls-Windsor.
Education - A New Beginning
- Grants to school boards for administrative
costs are being adjusted, consistent with the restructuring of the
education sector and declining enrollment.
Expenditures will more than double to $38
million on school construction and renovations over the next three
years, compared to $18 million over the past three years. Three schools
will be built in Labrador at Nain, Rigolet and Hopedale. The balance
will be spent on renovations and needed maintenance across the system.
In order to put the 10 new school boards
on a solid financial footing $24 million was invested in 1996-97 to
repay all school board debt, and a further $2.5 million was invested in
the purchasing of new computers. This will ensure greater financial
stability of school boards for years to come.
Government will match a $6.3 million
contribution by the private sector to Memorial University's Opportunity
Fund.
Social Services and Employment - Renewing the
Social Safety Net
- A new Department of Human Resources and
Employment will be established. The existing programs of the Department
of Social Services and some from the Department of Development and Rural
Renewal will be incorporated into the new Department.
High school students will be able to earn
money to assist them to attend post-secondary institutions by tutoring
other students in a new Tutoring for Tuition program being introduced in
1997-98. $500,000 is allocated.
A special emphasis on those most in need
- children, youth and families.
A new $200,000 initiative will provide a
day care subsidy so social assistance recipients, particularly single
parents, can afford licenced child care providers.
The Province will participate with the
Federal Government in the new National Child Benefit program.
An educational program to provide
training for foster parents is being established, at a investment of
$70,000.
A new $175,000 initiative to eliminate
the long waiting list for post-adoption services will be introduced in
1997-98.
Students with dependents will be required
to access the maximum available student aid.
For 1997-98 $2.5 million will be invested
in a new student employment program, available to all students, in
celebration of the Cabot 500 Year. This will be matched by $2.0 million
from the Federal Government and create summer employment for 3,00
students.
Parent's resources will be taken into
account in determining eligibility for Social Assistance for single
able-bodied clients between the ages of 18 and 21.
Government will continue its efforts to
downsize and close group homes with a view to further integration into
the community.
$4 million has been allocated to provide
Workers' Compensation coverage and to provide for a wage adjustment for
home support workers.
Local Services
- Local Government must be financed by the
public it serves. To this end the Province will promote greater
self-determination and self- reliance for municipalities by working in
partnership with them rather than for them.
Municipal Operating Grants (MOGs) will be
reduced by 20% in each of the next three years.
The municipal share of debt servicing
costs for municipal water and sewer debt will be increased from its
present level of $343 per household to $400, and by a further $50 per
household in each of the next two years.
$9 million has been paid to the
Newfoundland Municipal Financing Corporation to allow selected
municipalities to restructure their debt and assume more responsibility
for local services.
Transition funding of $4 million has been
provided to St. John's and Corner Brook as compensation for the
elimination of firefighting grants.
A new agency will be established to
provide municipal assessment services to be run by a new Board made up
of municipalities and the Province.
The Province will participate with the
Federal Government and municipalities in a new Infrastructure Program
valued at $30 million.
The Municipal Capital Works Program will
be continued at $25 million for 1997-98.
The Province will participate with the
Cities of St. John's and Mount Pearl and the Town of Paradise, in the
St. John's Harbour Clean-Up.
$5 million is provided to assist with the
construction of a new civic center for the St. John's area.
Partnering for Development
- Government is refocusing its assistance to
business to ensure a proper role for the public sector in facilitating
economic growth.
A new five year comprehensive economic
development agreement with the Government of Canada, valued at over $50
million, will be operational in 1997-98.
Government remains fully committed to
working with the Regional Economic Development Boards in the 20 economic
zones.
There is provision for a $17 million
Strategic Enterprise Development Fund targeted at investment prospecting
activities and to economic sectors with growth potential.
Government will move to dispose of its
interests in Newfoundland Farm Products Corporation.
Government will consider public/private
partnering and privatization options for the Bull Arm Site, Marystown
Shipyard Ltd. and Marble Mountain.
Other Important Initiatives
- The Government is working with the Federal
Government on the devolution of social housing to the Province from
Canada Mortgage and Housing Corporation.
The rent-geared-to-income scale for
Newfoundland and Labrador Housing will range from 25% to 30%, to bring
it more in line with standard practices in the country.
The Government is actively and
aggressively pursuing, with the Federal Government, an agreement on the
Labrador Transportation Initiative to improve roads infrastructure in
Labrador.
The Province will continue to be policed
by the RNC and the RCMP.
The mining tax system will be reformed in
1997-98.
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