March 22, 1999
(Finance)

Budget 1999-2000: Investing in Priorities

Finance Minister Paul Dicks today delivered the 1999 Budget Speech which focused on the top priorities of Newfoundlanders and Labradorians: health care, education, and helping those most in need. The Budget included strategic re-investment of a surplus of about $130 million in key areas in 1998-1999, and provision for a modest deficit in 1999-2000. "While we must continue to be prudent and responsible in our spending, government does recognize that there is a need, today, for investment in the areas of health and education," said the minister. "I am pleased that we were able to utilize our surplus to respond to the priorities of the people of the province in 1998-1999, as well as maintaining fiscal flexibility for the coming year."

Some of the health highlights of the 1999-2000 Budget include:

• $40 million to eliminate Regional Hospital Board accumulated deficits to March 1998;

• $21 million in additional funding for hospital equipment, Y2K issues and to continue the development of a Provincial Management Information System;

• $15 million in additional funding for Board budgets;

• $1.8 million new drug therapies; and

• $1.3 million to implement the new Child, Youth and Family Services Act.

Government is investing in the future through the education of the province's youth. This includes a funding increase of $11.9 million to Memorial University and College of the North Atlantic to ensure continued delivery of quality education and to enable those institutions to freeze tuition fees at existing levels for at least the next two years. Other education investments include:

• $125 million is being invested in school construction and upgrades;

• Retention of 236 teaching positions that otherwise would have been eliminated;

• Maintain funding of $7.4 million for student assistants, even though enrolments are declining;

• $6 million over the next two years to provide the public with Internet access sites, mainly through public libraries; and

• Increased funding of $500,000 for Literacy;

Another highlight of the 1999 Budget is the implementation of a Low Income Seniors' Benefit which will put over $25 million into the hands of 34,000 seniors over the next five years alone. The benefit will be $200 for seniors with a family net income of $12,000 or less, and will be phased out at the rate of 2.5 per cent of income as family income rises from $12,000 to $20,000. The first cheques for the Low Income Seniors' Benefit will be issued this fall.

Other budget initiatives include:

• an increase in the minimum wage to $5.50;

• an increase to $150,000 in the exemption threshold for the payroll tax which will make $12.5 million available to businesses for employment and investment over the next five years;

• $13 million for Employment Programs, including $7.5 million for students and youth, which will create jobs and reduce the number of persons receiving social assistance;

• $100 million multi-year Municipal Capital Works Program, as well as a $20 million Municipal Capital Works Program for 1999-2000.

Government's fiscal plan invests in people, supports communities, develops infrastructure, grows the economy and protects the environment.

Media Contact: Paula Dyke, Communications, (709) 729-0329

1999 03 22