Drought, wildfires, COVID-19 drive up Saskatchewan deficit to record $2.7B

REGINA – Saskatchewan’s latest financial report says drought, wildfires and the COVID-19 pandemic have heavily contributed to what is projected to be a record deficit.

The mid-year report released Monday shows a deficit of $2.7 billion, an increase of $97 million from what was forecast in the 2021-22 budget released in April.

The update says expenses are up $2.5 billion from what was forecast, largely due to $1.8 billion for crop insurance claims that were not anticipated.

Rupen Pandya, deputy minister of finance, said $2.4 billion of that is a result of widespread and severe drought.

“That payment, just on crop insurance alone, is the largest payment in Saskatchewan history for the crop insurance program,” Pandya said.

“In terms of the severity of the drought – while significantly severe – there’s been two other more severe impacts.”

The drought also affected crop production, decreasing it by 40.6 per cent, said Pandya.

Finance Minister Donna Harpauer said she doesn’t attribute this year’s severe weather events to climate change.

“Just being a past producer for a number of years, I experienced a drought in 1988. I experienced a drought in 2002. It’s cyclical,” Harpauer said.

“Will scientists say this is due to climate change? That’s up for them to say.”

Over the summer, Saskatchewan experienced an extreme heat wave that resulted in record-setting temperatures in several areas.

The Saskatchewan Public Safety Agency says there were 627 wildfires – more than double the five-year average of 305.

The province spent $101 million in non-budgeted money within the safety agency to deal with the wildfires, which emerged during a dry spring and summer, as well as on additional costs the agency had related to the pandemic, including personal protective equipment and hotels for those who needed to isolate.

Another $250 million was needed to address pressures in the health-care system brought on by the fourth wave of COVID-19. The figure does not include the amount of money Saskatchewan spent sending dozens of COVID-19 patients to Ontario. The government, saying it hasn’t been billed yet, was unable to provide those numbers.

Despite fiscal pressures brought on by weather and the pandemic, Harpauer called the budget exciting.

“We haven’t spiked the ball, but without the agriculture support (expense), we’d almost be balanced,” said Harpauer, who added she is anticipating a balanced budget by 2026-27.

The NDP Opposition’s finance critic said Harpauer’s remark is “out of touch” as “she tries to celebrate the damage and loss we’ve seen” from COVID-19 and adverse weather.

“The Saskatchewan Party (government) is really regressive when it comes to climate change. They put their head in the sand. And you see that kind of denial again here today,” Trent Witherspoon said.

“What people deserve is a government that’s going to be honest with them, and work with them to step up to the challenge in a practical way, to reduce costs, reduce emissions while creating jobs.”

 

Feature image by iStock.com/Kat72