Black Ink Turning Red

We are roughly a week away from a provincial budget but we’re starting to see some speculation about what it will contain.

We have been fairly well briefed on the spending measures that it will carry. We got a good chunk of that a couple months back when the government tabled its estimates for the year. That is the spending plan. What it didn’t reveal at the time was its revenue forecast.

That was because the COVID pandemic hit just as the ink was drying on the overall budget. So, with all the uncertainty around the impact of a lockdown, the government released its spending intentions but withdrew its revenue projections until it get a better handle on what was going on.

That assessment will come next week but the economists at BMO Bank of Montreal have already issued their forecasts for how much the government will spend.

And they are suggesting we should see the projected surplus or near surplus budget turn into a $2.2 billion deficit which is in line or better than most provinces.

Source: https://economics.bmo.com/en/publications/detail/99dea5ae-32d5-42e9-9a94-2ddb1e61619d/