Low commodity prices were a major factor in Saskatchewan’s credt rating dropping to double A plus, but the Canadian Taxpayers Federation believes the only way to get back up to triple-A is to pay off debt.
Prairie Director Todd MacKay says the provincial government had been working on paying off debt up until about 3 years ago. Recently, he says, the province has been borrowing more money, including $700-million in the 2016-17 budget.
MacKay says the CTF estimates the province’s tax-supported debt will rise to $15.4 billion by the end of the fiscal year, with another $300-million in interest.
MacKay says interest rises when credit ratings are downgraded, and that additional money goes straight to Wall Street instead of hospitals, schools and businesses in Saskatchewan.
He says trimming a budget is always hard and isn’t fun to do, but it has to be done. He points to families and businesses across the province who are finding ways to stretch their dollars in a tougher economy to get by.
He says in the long term, another way to get back to Standard and Poor’s top mark is to create a heritage fund so the province can put money aside for the next economic boom.