WINNIPEG, Manitoba (Reuters) - The Western Canadian province of Saskatchewan expects to post a slim surplus in the 2014-15 fiscal year by trimming budget spending to help offset a slip in revenue, the government said on Wednesday.
Saskatchewan has remained in surplus for two decades, even as most provinces ran deficits when their economies slowed in recent years. Its population surpassed 1.1 million in 2013 for the first time, fueled by the expanding energy and mining sectors.
Revenues are expected to dip by 0.7 percent in 2014-15, however, to C$14.07 billion ($12.59 billion). Premier Brad Wall’s right-leaning Saskatchewan Party government trimmed spending by 0.2 percent to C$14 billion from the previous year’s budget.
“Our government’s preference will always be to balance the budget by controlling spending rather than by raising taxes,” Finance Minister Ken Krawetz said in a statement.
Saskatchewan, which depends heavily on resource revenues and a farm economy, forecast a C$71.4 million surplus in 2014-15. The government said it expects the 2013-14 year, which ends March 31, to finish C$591 million in the black.
Revenue is expected to drop from fees for certain goods and services and income from government businesses such as the province’s liquor and gaming authority.
The province, home of potash mines owned by Potash Corporation of Saskatchewan, Mosaic Co and Agrium Inc, was stung last year by a drop in the fertilizer’s global price amid weakening grain prices and the break-up of the Belarusian Potash Company, one of the world’s biggest potash traders.
In the next fiscal year, Saskatchewan expects revenue from non-renewable resources, which include potash and crude oil, to edge up to C$2.7 billion, although it sees potash prices falling further. Potash will fetch an average price per ton of $273.93 in 2014 and $275.72 in 2015, down from $345.27 per ton last year, according to government estimates.
Saskatchewan expects its total public debt to rise 8 percent to C$11.8 billion by March 31, 2015, the end of the next fiscal year. Its operational debt, which excludes debt held by government-owned corporations, health authorities and school divisions, is expected to remain at C$3.8 billion.
($1 = 1.1179 Canadian Dollars)
Reporting by Rod Nickel in Winnipeg, Manitoba; Editing by Meredith Mazzilli