Finance
January 29, 2016

Long-Term Planning for Financial Sustainability

Provincial Government Responds to Credit Rating Change

The Honourable Cathy Bennett, Minister of Finance and President of Treasury Board, is responding to the announcement today from Standard and Poor's Ratings Services that they have changed the province’s credit rating from A+ to A, with a negative outlook.

“This government is working very hard to protect our credit ratings in the face of a tremendously difficult fiscal situation. The situation we find ourselves in now is serious and while we are disappointed with the news that Standard and Poor’s has lowered our credit rating and indicated a negative outlook, this will not stop our work to get this province back on track. This is yet another clear indication that bond rating agencies and major banks are watching this province closely and we must take action to protect ourselves from further downgrades and ensure we return to the ratings we once had.”
‎- The Honourable Cathy Bennett, Minister of Finance and President of Treasury Board

In the last week, DBRS maintained Newfoundland and Labrador’s credit rating at A and revised the outlook from stable to negative and Moody’s maintained the province’s credit rating at Aa2 and revised the outlook from stable to negative.

Standard and Poor’s has indicated they could restore the stable outlook if government takes the fiscal measures necessary to establish an improving trend in budgetary performance beyond fiscal 2017, and develops a credible plan to restore budgetary balance in the medium term.

“We understand the gravity of this circumstance and the message being delivered by Standard and Poor's. We will get this fiscal situation under control and we will take decisive actions with Budget 2016 this spring, followed by medium-term actions throughout the course of the year and longer-term actions in Budget 2017.We all have a responsibility to get involved. We are encouraging Newfoundlanders and Labradorians to help us shape the actions that government takes in the short and long term.”
‎- Minister Bennett

Residents can participate in-person at Government Renewal Initiative engagement events or via mail, email, online, or telephone. Details can be found at www.gov.nl.ca/ourfiscalfuture/

QUICK FACTS

  • The Provincial Government is working hard to protect credit ratings in the face of a difficult fiscal situation.
  • Standard and Poor's Ratings Services have changed the province’s credit rating from A+ to A, with a negative outlook.
  • In the last week, DBRS maintained Newfoundland and Labrador’s credit rating at A and revised the outlook from stable to negative and Moody’s maintained the province’s credit rating at Aa2 and revised the outlook from stable to negative.
  • The multi-year Government Renewal Initiative was launched to identify actions to eliminate the province's deficit and put in place a sustainable budgetary framework.
  • Details of the Government Renewal Initiative can be found at www.gov.nl.ca/ourfiscalfuture/

- 30 -

Media contact:

Jennifer Tulk
Director of Communications
Department of Finance
709-729-6830, 728-4104
jennifertulk@gov.nl.ca

2016 01 29                                                                        7:15 p.m.