• In the 2000-2001 Budget, government will continue to re-invest in the priority area of health care. To assist in the funding of these re-investments, government will access additional revenues of nearly $215 million from several sources. These include: Newfoundland and Labrador Hydro, Newfoundland and Labrador Housing Corporation, Sinking Funds and Newfoundland Liquor Corporation.

• These additional revenues include some $129 million government is able to defer from 1999-2000 because it has exceeded its financial objectives. These revenues will fund important and necessary investments in the health and well-being of Newfoundlanders and Labradorians.

•  As sole shareholder of Hydro, the province is able to exercise discretion with respect to the receipt of dividends. This gives government some flexibility in designing budgets.

• In 2000/01, government will receive dividends of $121 million, comprised of regular dividends of $61 million and special dividends of $60 million. The regular dividends include revenues from the new recall arrangements and Guaranteed Winter Availability Contract related to the Upper Churchill.

• $76 million of the $121 million to be received in 2000/01 represents the special dividends of $60 million and $16 million in regular dividends deferred from the 1999/00 fiscal year.

• Government guarantees all of Hydro’s long-term debt and short-term borrowings, and as such receives a guarantee fee. This fee is based upon the total debt of Hydro guaranteed by the province as of the preceding December 31 (i.e. Hydro’s fiscal year end) and is paid quarterly.

• In the 2000 Budget, government has requested Hydro to pay the regular guarantee fee of $10.8 million based upon its December 1999 year end, plus to accelerate payment of the fee for those three quarters of its current fiscal year which fall within government’s 2000/01 fiscal year. This is a one-time action and will result in $8.1 million in additional revenues.

• This "accelerated" guarantee fee had been included in the 1999 Budget, but has been deferred to 2000/01.

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