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Nova Scotia Budget 2019–20: Increased revenues boost healthcare investments

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Finance Minister Karen Casey tabled the 2019–20 Budget on Tuesday, March 26 with a razor-thin surplus of $33.6 million. This is the fourth consecutive balanced budget under Stephen McNeil’s Liberal government. The 2019–2020 Budget focuses on four key themes:

  1. Improving access to healthcare
  2. Creating conditions for economic growth
  3. Investing in education and preparing youth for the workforce
  4. Supporting people and communities

Topline insights

  • An increase in federal transfers from Ottawa will allow the Nova Scotia government to invest an additional $200 million in healthcare.
  • Federal contributions to the province are expected to increase over $178 million, with transfer and equalization payments making up about one third of total revenues.
  • Nova Scotians will not see any increases in taxes.
  • Education funding will increase by approximately $33 million. By 2020, the government has committed pre-primary access to every four year old in the province.
  • Due to the introduction of edibles and concentrates, funding for cannabis legalization will increase by $1.1 million for a total budget of $3.5 million.
  • New measures are being introduced to encourage investment in business, including $3 million to pay for a new venture capital tax credit aimed at encouraging equity investments in Nova Scotia companies and tax credits that will assist startup firms that have existed for less than 10 years.
  • The province’s capital budget sits at $691.3 million, with money earmarked for highways, schools and a major healthcare redevelopment that will retrofit hospitals in Halifax and the Cape Breton.

What it all means: Stay the course

Budget 2019 is consistent with the approach the provincial Liberals have taken to date: balance the budget, sprinkle in some new spending, and focus squarely on priorities such as healthcare, education and skills development, and creating conditions for innovation and economic growth.

Nova Scotia is part of a handful of Canadian provinces that are delivering balanced budgets. This budget stands in sharp contrast to last week’s federal budget, with a projected a $20 million deficit for at least the next two years, despite a 2015 campaign promise to balance the books by 2019.

By the end of May, the McNeil Government will have approached the middle of its second majority mandate. With a growing public concern over access to primary healthcare and a robust political narrative of a “healthcare system in crisis”, McNeil’s balanced budget risks not hitting the mark with Nova Scotians. Arguably, the government had to come out strong with a significant focus on improving healthcare—and the investment to back it up.

To tackle this critical challenge, Budget 2019 invests an additional $200 million in primary healthcare throughout the province. The true test of this investment will play out over the next number of months as Nova Scotians will look for tangible improvements, from their ability to access healthcare professionals in a timely manner to improvements in the emergency care system.

Not surprising, Nova Scotians consistently rank deficit reduction as a lower priority than social spending. In this climate, with growing concerns over healthcare, McNeil has provided the opposition leaders with some political ammunition. As the new Progressive Conservative Party leader, Tim Houston, pointed out, spending more money on healthcare doesn’t necessarily mean better management of the system. The next few months will be critical—Nova Scotians expect to see progress on healthcare and neither the PCs nor the NDP intend to let the government off the hook.

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