Budget Highlights 1998

Living Within Our Means

• The 1997-98 Budget projected a $20.3 million deficit. The deficit projection is on target at $20.1 million. The deficit target for 1998-99 remains at $10 million.
• Government is on track with its three year financial plan which will see a balanced budget by 1999-2000.
• Government continues to be prudent in its financial management and accordingly, is providing for a $30 million contingency reserve again this year.
• There are no tax increases in this budget. As a result of the Federal Budget, personal income taxes for residents of this Province will be reduced by over $30 million of which $12.5 million comes from provincial revenues.
• Effective for 1998 taxation year, the $100,000 exemption for payroll tax will be increased to $120,000. In excess of 225 small businesses will be removed from the payroll tax rolls and approximately $1 million will be put back into the hands of the business community.
• This Budget includes funding for a wage increase for our public sector employees that is within our means.
• No new layoffs are anticipated.
• This Budget makes a significant investment towards addressing Government�s pension obligations and provides for the reform of the MHA pension plan.
• Government has consulted with the people and is making investments in education, health care, and the reform of our social programs.

Our Social Priorities

Health Care - Continues to be Our First Priority

• This Government will continue to press the Federal Government for increased funding for Health Care now that the Federal deficit has been eliminated.
• An additional $3 million is provided in 1997-98 for hospital equipment.
• In 1997-98, Government injected an additional $20 million to stabilize the health system. This funding will not only continue for 1998-99, but will be increased to $30 million.
• This year, Government will also provide a further $2 million for Community Health.
• $500,000 will be provided to assist with medical transportation costs for those who must travel for specialized health care services.
• $2.8 million is provided for increased cost pressures and demands on the drug programs for seniors and persons on social assistance.
• Work is continuing on the $130 million capital project of the St. John�s Health Care Corporation.
• Work is continuing on new hospitals at Harbour Breton and Happy Valley-Goose Bay, and the extension of James Paton Memorial Hospital in Gander.
• Government has a multi-year plan for new modern health facilities which includes:
  • The replacement of the Blue Crest Nursing Home and the hospital in Grand Bank with a new multi-purpose facility.
  • The replacement of the Carmelite House Nursing Home in Grand Falls-Windsor with a new long-term care facility.
  • The replacement of the Cottage Hospital in Old Perlican with a new community health centre.
  • The construction of new multi-purpose health care centres in Fogo and Bonne Bay.
  • The construction of a new hospital for the Stephenville/Port au Port/Bay St. George area.
  • Planning and design work will commence later in the year to address identified needs at Dr. G. B. Cross Memorial Hospital in Clarenville.

Education - The Future is in Our Hands

• The Newfoundland and Labrador Education Investment Corporation is established with a commitment of $50 million over the next several years toward construction and upgrading of schools.
• Government will "add back" 200 of the 425 teaching positions that would have been eliminated based on declining enrolment. An additional 70 units will be provided to help those children with special needs and disabilities.
• Government will provide $4 million for awards to post secondary students based on academic merit and financial need. More than 4,000 awards of up to $1,000 will be available over the next two years.
• Government will make a contribution of $3 million to Memorial University's Opportunity Fund, bringing its total contributions to date to $9.3 million.

Social Reform - Bringing Opportunity and Independence to Families

• A new Department of Health and Community Services will be established to integrate the provision of children and family health services through existing regional community health boards.
• Core funding will be provided for transition homes in Nain and on the Burin Peninsula.
• Basic rates for individuals and families receiving income support will be increased by 7% over the next three years, commencing with a 2% increase in 1998-99.
• $400,000 is dedicated to a new $150 per month cost of living allowance for families with dependent children living on the Labrador Coast.
• A $500,000 pilot project will be conducted to explore means of support, such as day care, that will enable single parents collecting social assistance to maintain employment.
• The monthly earnings exemption for those families with dependent children on income support will be increased from $100 to $150.
• In 1998-99, $4.4 million will be provided to create up to 1,200 meaningful employment opportunities in the private and non-profit sectors.
• Over $7.5 million will be directed this year towards youth employment programs.
• Endowment funding of $1 million will be provided to the School Children�s Food Foundation of Newfoundland and Labrador to expand its efforts in meeting the nutrition needs of children throughout the Province.
• $10.5 million in savings from the National Child Benefit Program will be reinvested into new benefits and effective client-centred services for low-income families. The initiatives that will be introduced by this Province include:
  • $1.15 million for additional Family Resource Centres.
  • $4.6 million for the improvement and expansion of licensed child care services in the Province.
  • $2.8 million for the establishment of regional youth service networks, in partnership with existing community programs.
  • $1.6 million for initiatives under the social assistance program designed to help parents who find work.

Developing Our Infrastructure

• $26.6 million is provided for Municipal Capital Works.
• This year, Government will spend $36 million on the construction of the Trans-Labrador Highway.
• Government will be spending a total of $16 million on provincial road construction and improvements.
• Under the Federal/Provincial Transportation Initiative, $56 million will be tendered this year for work on the Trans Canada Highway and major trunk roads.
• $2 million will be spent on forest access roads, improving the availability of wood to the sawmilling industry.
• 1997-98 marked the first year of managing the coastal Labrador ferry services. This year, Government will make positive changes to the rates and schedules for people using this service.
• There will be no rate increases for the first time in five years. In most cases, minimum rates for shipping freight and vehicles will be reduced.
• The ferry rate charged to ship heavy equipment to Community Councils in Labrador will be cut in half.
• Improvements will be made to the Fogo/Change Islands and Bell Island ferry services, including a $1 million improvement to their docking facilities. The former MV Prince Edward will be integrated into the Fogo/Change Islands service. The MV Beaumont Hamel will transfer to the Bell Island service to join the MV Flanders.
• An additional $3 million will be invested in the Newfoundland Municipal Financing Corporation to assist with municipal debt restructuring. This is in addition to the $9 million provided last year.
• Government remains ready to partner with the City of St. John�s, the Federal Government, and the private sector for the construction of a new civic centre for the St. John�s Region.

Growing the Economy

• Government will allocate $7 million under the Strategic Enterprise Development Fund for business opportunities in strategic growth sectors.
• In excess of $100 million will be invested under the Canada-Newfoundland and Labrador Labour Market Development Agreement.
• Government will invest $400,000 in new fisheries, with an emphasis on the commercialization of underutilized fish species.
• $10 million will be invested in the aquaculture industry through such initiatives as the completion of the aquaculture facility at the Ocean Sciences Centre in Logy Bay and the Aquaculture Resource Centre in Bay D�Espoir.
• Building on the success of the Cabot 500 year, Government will be providing $1.5 million to plan new celebrations commemorating such events as this Province�s 50th anniversary of Confederation (Soiree�99) and the Viking 2000.
• Soiree�99 will coincide with the 1999 Canada Winter Games in Corner Brook. An additional $445,000 will be provided in 1998-99 for capital improvements to the Stephenville Training Centre and the Arts and Culture Centre Pool in Corner Brook.
• Government will also provide in 1997-98 $600,000 to the Heritage Foundation of Newfoundland and Labrador.
• The Newfoundland and Labrador Film Development Corporation has been asked to develop a competive film tax credit program for this Province.

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