GOVERNMENT IS BUILDING FOR THE FUTURE

Finance Minister Jim Melenchuk today brought down Saskatchewan's 10th consecutive balanced budget containing major funding increases for health, education and municipalities.

"With this budget the government is building for the future by continuing priority funding for health care and education while at the same time increasing municipal funding, meeting the three-year $900 million commitment to highways, and continuing tax reductions," Melenchuk said.

"Building for the future is about building momentum for growth and opportunity and building programs and support for Saskatchewan people," Melenchuk said.

In 2003-04 for the first time health spending will exceed $2.5 billion, an 8 per cent increase. Education spending will top $1.2 billion this year, a 5.2 per cent operating budget increase. As well, an independent commission on how K-12 education is funded in Saskatchewan and options for change will be formed. Further details on the commission will be announced in the coming weeks.

"This budget also increases municipal revenue sharing grants by $10 million for the second year in a row," Melenchuk said. "This represents a 15.4 per cent increase. We will further increase municipal grants by another $10 million in 2004-05. With this third increase, municipalities will have received an additional $60 million between 2002-05."

The government is also continuing its commitment to lower taxes for individuals. Beginning in 2004, the personal income tax system will be fully indexed to inflation. This means that the amount of tax payable on a fixed amount of income will decline every year.

Saskatchewan-based businesses will also see lower tax rates, as the small business corporate income tax rate is being phased down from 6.0 per cent to 5.5 per cent on January 1st, 2004 and further reduced to 5.0 per cent in 2005. The Corporation Capital Tax exemption is being increased for Saskatchewan-based corporations from $15 million to $20 million over the next two years.

"In 2002-03 Saskatchewan recorded a $2.1 million surplus without drawing on the Fiscal Stabilization Fund, despite the province suffering its second consecutive major drought," said Melenchuk. "With a normal harvest we are predicting our economy to recover and record a 6.8 per cent jump in real gross domestic product (GDP) in 2003. We will ride this momentum into the new fiscal year and move forward to build for the future."

As a key step in the government's continuing efforts to improve accountability, it is releasing the publication Our Plan for 2003-04, which provides an overview of the key initiatives planned for the coming year along with the budget. As well, beginning in 2004-05 the government will incorporate a Summary Financial plan into budget documents.

"As part of our plan to build for the future, the government is providing multi-year funding commitments in a number of program areas to assist our stakeholders in planning and building for the future," Melenchuk said.

Budget highlights include:

- $61 million for building and renovating hospitals over the next two years;

- $110 million over the next two years for building and renovating educational facilities;

- 1200 new day care spaces over the next four years, with an initial commitment of 500 new spaces this year;

- Construct 1400 new homes under the Centenary Affordable Housing Program over the next four years including 400 homes this year;

- $800,000 for a feasibility study to look at options for developing an Academic Health Sciences Centre at the University of Saskatchewan;

- $500,000 for planning a Laboratory addition at the University of Regina;

- $150,000 for more detailed planning for replacement of the Regina Correctional Centre;

- $18.4 million in capital funding through the Canada Saskatchewan Infrastructure program for 41 water supply projects and 18 wastewater projects;

- $19 million for health equipment including diagnostic equipment such as CT scanners;

- $145 million in research and development spending and tax credits;

- 10 new police officers to support integrated, targeted, community-based approaches to reducing crime;

- $1 million increase in Social Assistance Program (SAP) payments for people with disabilities;

- an additional $2 million to help another 950 persons with disabilities achieve and sustain employment;

- 10 per cent increase in urban park funding for Wascana Centre Authority in Regina, Meewasin Valley Authority in Saskatoon, Wakamow Valley Authority in Moose Jaw and Chinook Parkway in Swift Current; and

- $1 billion over five years to support farmers.

For more budget details to http://www.gov.sk.ca/finance/budget

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For More Information, Contact:

Roy Schneider Finance Regina Phone: (306)787-8109