Posted: Dec 17, 2020 11:36 AM AT | Last Updated: December 17, 2020
Nova Scotia Finance Minister Karen Casey is shown in February.(Andrew Vaughan/The Canadian Press)
The Nova Scotia government s finances continue to be pummeled by the pandemic, but a larger than expected transfer of cash from Ottawa means they are in slightly better shape than what was projected in the summer.
While that is a deep fiscal hole to fill, Finance Minister Karen Casey tried to reassure taxpayers this was not a return to running deficits to finance ordinary government spending. This deficit is short term, caused by the economic shock from COVID-19 and the temporary measures that we put in place to manage our public health crisis, Casey told reporters on a conference call.
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The provincial deficit is now forecast to be more than $2 billion for the 2020-21 fiscal year, a drop of almost $900 million since the first-quarter update, which was predicting a $2.9 billion shortfall.
Finance Minister Scott Fielding and Premier Brian Pallister delivered the update on Thursday and say the improvement for the second quarter is due primarily to the inclusion of $648 million of federal transfers to the province for COVID-19 spending. The province also saved $347 million in the reduction of other base-budget expenditures.
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