Fires, floods and health push Sask. deficit to $825 million

Saskatchewan is forecasting an $825 million deficit for the first quarter of 2026-27.

That’s $6 million more than the $819 million deficit the government projected in its 2026-27 provincial budget.

Read more:

• VIDEO: No tax hikes or service cuts in Saskatchewan budget, despite $819M deficit
• Reaction to provincial budget comes in from across Sask. sectors
• Saskatchewan’s budget targets affordability. Here’s what’s being offered

According to Deputy Premier and Finance Minister Jim Reiter, the deficit “demonstrates our government’s commitment to responsible financial management while continuing to invest in the programs and services Saskatchewan people rely on.”

By comparison, Saskatchewan finished the 2025-26 fiscal year with an operating deficit of $947 million, down from a projected $12 million surplus.

The total revenue forecast for 2026-27 is $21.7 billion, while total expenses are expected to hit $22.6 billion.

Revenue is projected to be $331 million higher than the budget’s projections in the first quarter, according to the provincial government, primarily because revenue coming from non-renewable resources is expected to be $320 million higher than budgeted.

“Higher-than-expected oil prices due to the ongoing conflict in the Middle East has resulted in the West Texas Intermediate oil price forecast being increased to US $75.00 per barrel compared to a projected US $59.75 per barrel in the 2026-27 budget,” the province said in a statement.

According to the government, total expenses are projected to be $337 million higher than the budget projected, mainly because of pressures in the health-care system, including “growing service demand, inflation, and compensation costs.”

Another factor in the higher expense forecast was the flooding that hit many parts of the province earlier this year. Specifically, the provincial government said it’s a consequence of the “flood-related response and recovery efforts and higher Crop Insurance claims resulting from unseeded acres due to excess moisture in the spring.”

Saskatchewan’s economic outlook is better than it was when the 2026-27 budget was released, partly because of construction and an improved commodity outlook.

“Saskatchewan is expected to remain one of the fastest-growing provincial economies over the next two years,” the government noted.

As a result, real GDP growth is expected to place Saskatchewan third among Canadian provinces in 2026 and second in 2027.

“Saskatchewan’s net debt-to-GDP ratio is projected to be 14.9 per cent as of March 31, 2027,” the province added.

That’s an improvement from the 16.1 per cent ratio projected in this year’s budget, and would put Saskatchewan’s net debt-to-GDP ratio second-best among the provinces.

“Saskatchewan also continues to have the highest credit rating among provinces,” the government added.

Provincial NDP blasts first-quarter financial results as “damning”

NDP Finance Critic Trent Wotherspoon at the Legislature on Aug. 27. (Gillian Massie/980 CJME)

Trent Wotherspoon, the NDP’s finance critic, says the province’s first-quarter financial results show the Saskatchewan Party-led government has no fiscal credibility and cannot be trusted with taxpayers’ money.

He calls the report “damning.”

“You have a government that’s actually getting an additional boost of hundreds of millions of dollars from an international conflict, which we’ve been pointing to, but yet is still growing the deficit, the debt, and not offering an ounce of cost-of-living relief to the people of this province.”

Wotherspoon called the provincial government’s actions “tax and squander” and said the first-quarter results were “beyond disappointing,” but predictable.

“The fact that, again, they’ve missed their budget in a big way, on the expense side, and can’t manage our finances is a concern. The reality is that they’re wasting dollars hand over fist, day after day, on project after project, and that all comes at a cost to Saskatchewan people.”

Wotherspoon added that at the very least, the provincial government could use some of the extra estimated $300 million in revenue to suspend the gas tax, something his party has been seeking for months.

He also reiterated his party’s call for the provincial government to pull U.S. alcohol from Saskatchewan liquor store shelves.

The full 2026-27 First Quarter Financial Report is available on the Government of Saskatchewan’s website.

Read more:

• VIDEO: No tax hikes or service cuts in Saskatchewan budget, despite $819M deficit
• Reaction to provincial budget comes in from across Sask. sectors
• Saskatchewan’s budget targets affordability. Here’s what’s being offered

-with files from 650 CKOM’s Lara Fominoff