Agriculture is taking blame for higher than expected Saskatchewan government spending.
But most of the extra $130.6 million on the department’s books this fiscal year is there because the province signed the agricultural policy framework, a new five-year deal between Ottawa and the provinces covering risk management, environment and other key aspects of agriculture.
Under that agreement the province must account for its spending under the new Canadian Agricultural Income Stabilization program during the current fiscal year, even though 2003 claims won’t be complete until about a year from now, said acting deputy agriculture minister Hal Cushon. CAIS replaces the popular Net Income Stabilization Account program.
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“This is purely an accounting issue,” he said last week.
The department has set aside about $100 million for CAIS. The remainder of the extra spending is for BSE programs.
Earlier, provincial finance minister Harry Van Mulligen released the pro-vince’s third quarter financial report, noting that operating spending was up by $147.8 million.
Slight decreases in some department spending, including health, were offset by increases in other areas including agriculture, final forest fire costs and last fall’s election.
Overall revenues were $76.9 million better than budget. Although the oil and gas sector will bring in an extra $273.6 million, the federal government will transfer nearly $200 million less than expected.
The province will have to draw $463.3 million from its rainy-day fund to maintain a balanced budget.
Van Mulligen warned of extensive cuts in the coming budget, which should be delivered next month.
“I expect at the end of the day that people will be unemployed as a result of the budget,” he said.
