FREDERICTON — The New Brunswick government tabled a $14.3-billion budget Tuesday that has been driven deep into deficit by a promised increase in health-care funding and a contingency fund to deal with U.S. tariff threats.
Finance Minister René Legacy's budget forecasts a $549-million deficit that swells to nearly $600 million when the tariff contingency fund is added.
"As this government's finance minister, it is difficult for me to stand here in front of you today announcing such a significant deficit when one of our campaign commitments was to deliver a balanced budget in each year of our mandate," Legacy told reporters before tabling his budget in the legislature.
He said "revenue windfalls" enjoyed in previous years were not materializing and U.S. President Donald Trump's threats of a sweeping 25 per cent tariff on goods from Canada has cooled off the province's economy.
"As you can imagine, preparing for today, for this speech, with the daily pivoting in direction on tariffs, countermeasures and exemptions, was a challenging task," Legacy said in his budget speech. "The challenges will undoubtedly carry on into the foreseeable future."
In the Liberal government's first budget since winning election in October, total revenues for 2025-26 are forecast at nearly $13.8 billion, while total expenditures before the $50-million contingency fund are $14.3 billion.
While building "flexibility" in the budget for challenges brought on by the trade war, Legacy said the government will honour its main health-care promise, earmarking $4.1 billion for the department, which is about $293 million more than last year.
Some of the other areas of focus in the budget are education, housing and services for victims of domestic violence and sexual violence.
The government said it will increase the budget of the New Brunswick Housing Corp. by $18.6 million and plan to build more homes.
"We will also create a dedicated provincial sexual violence unit to investigate the most severe and complex sexual violence in human trafficking cases," Legacy told reporters.
Richard Saillant, economist and former vice-president of Université de Moncton, called the budget austere. Revenue growth is only four per cent, while spending growth is at five per cent compared with nearly 10 per cent in previous years, he said.
Demographic changes, including a potential decrease in immigration, further complicate the fiscal situation along with an unpredictable neighbour to the south, he added. Saillant said he was not surprised by the extent of the deficit, calling it "a tough budget for them."
This report by The Canadian Press was first published March 18, 2025.
Hina Alam, The Canadian Press
