Alec Salloum
Regina Leader-Post
After early projections narrowly placed Saskatchewan in the black for the 2025-26 budget, the province now expects to be in the red to the tune of nearly half a billion dollars.
The province is now projecting a deficit of $427 million, citing expenses from wildfires and health care pressures, according to a mid-year financial report released Tuesday.
Finance Minister Jim Reiter said despite the headwinds of economic uncertainty, Saskatchewan’s economy “remains remarkably resilient.”
“There are difficulties we’re dealing with. I’m not sugar coating that,” said Reiter, who also serves as deputy premier. “A lot of the economic factors we’re dealing with, most of them in fact, aren’t provincial issues. They’re geopolitical issues.”
Reiter said Saskatchewan has “generally fared better than other provinces” because most of its exports are CUSMA compliant, but steel and lumber are still feeling the pinch of tariffs from the United States. The report says tariffs from the U.S. and China have had “some negative impacts” on exports.
The province projected a surplus of $12 million back in March. According to the mid-year report, the current projected deficit is up $79 million from the first quarter of the year.
Speaking Tuesday morning, Saskatchewan NDP finance critic Trent Wotherspoon reiterated his position from March that the “budget wasn’t worth the paper it was printed on.”
He said the province’s projected oil prices were “recklessly high,” and criticized the inclusion of the output-based performance standards (OBPS) as revenue, even though the province is no longer collecting its provincial carbon tax.
“I don’t trust the Sask. Party government will ever get back to balance. They have failed to balance the budget in the best years,” said Wotherspoon.
The OBPS is listed as $466.9 million in revenue in the report. While Reiter confirmed the province is not collecting it, he said he understands it to be a requirement to record it as if it was operational.
“I’m not trying to be coy about this, but we don’t know until we see what arrangements are made with the federal government,” he added when asked how it may or may not impact the budget.
Year-to-date in 2025, exports have fallen by $1.4 billion. The report largely attributes this to a decrease in global oil prices.
Total revenue is now forecast at $21.13 billion, up $82 million from the initial budget projections. Increases to revenue are due to $273 million in federal transfers and $129 million in own-source revenue, according to the report, which notes non-renewable resources are revenue is projected to be down $93 million as a result of a higher exchange rate and lower oil prices.
Total projected expenses came in at $21.56 billion, up $521.2 million from budget. The report attributes the increase in expenses to an additional $295 million for wildfire-related costs and $250 million to address what the province calls “health care utilization pressures.” There is also an increase of $114 million in pension expenses.
Total crop insurance claims were lower than expected, according to the government, though it expects those costs to be finalized in the third quarter of the budget cycle.
Reiter said he expects the province to still be in the red come spring.
