To help stimulate Saskatchewan’s bruised economy, couldn’t the province just borrow more money? And if so, what’s the limit?
Those were some of the questions on the minds of delegates last week during the Saskatchewan Urban Municipalities Association (SUMA) convention in Regina, which brought together hundreds from around the province.
Councillor Terry Rollie with the resort village of South Lake brought the issue forward during a question and answer session of provincial cabinet ministers. He suggested borrowing more may help spur infrastructure projects and thus rebound the economy, keeping the province running on a straight and even keel.
“How much can we borrow? It depends with respect to how much we can afford to pay in interest payments on an annual basis,” responded Finance Minister Kevin Doherty.
“We could borrow a lot more but we’re not particularly interested in the implications of that with respect to the long-term impact on the economy,” added Premier Brad Wall.
This, even though Saskatchewan has a triple A credit rating from Moody’s Investors Service of New York, the highest grade offered by the firm.
Wall had announced earlier at the convention that the province would run back-to-back deficits this year and next fiscal year, if the SaskParty is re-elected. He said Saskatchewan has a serious shortfall of revenue, due in part to the downturn in oil prices and the cost to fight northern wildfires. Running deficits was the last resort, he explained, and dismissed tax hikes or cuts to government programs.