Alec Salloum, Regina Leader-Post
Putting out a provincial budget without a tariff contingency plan is like an NHL team starting the season with just one goalie, says University of Saskatchewan economics professor Keith Willoughby.
“That one goalie might be really, really good for you. The goalie could be hot. But what happens if the goalie gets injured? What happens if the goalie has a bad couple of games?” said Willoughby, who is dean of the Edwards School of Business.
“You need a backup goalie and, to me, we don’t have a backup goalie in this budget.”
The 2025-26 provincial budget was unveiled on March 19 and projected a razor-thin surplus of $12.2 million. Finance Minister Jim Reiter acknowledged that figure comes with a major caveat given the variety of tariffs that have been implemented or threatened by the U.S. on Canadian goods and energy.
British Columbia, Alberta, Manitoba and New Brunswick have all included contingency plans in their provincial budgets.
Willoughby called Saskatchewan’s budget “optimistic.” While it’s noteworthy that the government could turn around a surplus, it pales in comparison to the potential impact of tariffs.
“That $12-million surplus could be wiped out quickly if we get into some of these terrible scenarios that we could see with our export economy,” he said.
The Saskatchewan government did game-plan for various tariff scenarios within the budget, pointing to the possibility of an $8.2-billion reduction of exports from the province to the U.S., plus a 5.8-per-cent decrease to gross domestic product (GDP) and a $1.4-billion reduction in revenue.
Jim Farney, professor and director of the University of Regina’s Johnson Shoyama Graduate School of Public Policy, said the budget was reminiscent of 2020’s COVID-19 budget.
There’s no real way to “model what the American tariffs will look like, how long they will last, when they will come in, if they will come in,” he said in a recent interview.
When it comes to other provinces that have “pre-borrowed” for their contingency funds, Farney said there was little point in Saskatchewan doing the same based on the high interest rates currently in play.
“We can go to market and borrow if we need it,” he said, adding the federal government has “deeper pockets” than the province should an emergency scenario occur.
But resource revenue and increased global interest in uranium could help Saskatchewan weather the uncertain storms posed by U.S. and Chinese tariffs, Farney noted.
“Those natural resources will continue to be valuable because people still need to drive their vehicles, they need to plant their crops, they need to feed their families,” he said.
But Farney added that it’s “highly unlikely” Saskatchewan ends the fiscal year with the projected $12.2-million surplus.
Willoughby concluded that it’s possible his predictions are wrong, but it would require a course reversal by U.S. President Donald Trump — or the World Trade Organization stepping in to help settle some of the trade disputes — as more tariffs are slated to come into force April 2.
“I don’t think that’s a likely scenario,” he said.
Farney agrees, to a point. While he feels the path presented by the province is “sensible,” he said “this year’s budget just has much larger margins of uncertainty than we’re used to.”
