BUDGET PLAN FOR 2005-06

Revenue Plan

Mr. Speaker, as a benefit of our actions and successes of the past year, we are now in a position to announce that there are no new taxes and, with one exception, no tax rate increases in this year’s budget.

Our primary reason for implementing this solitary tax increase is not to raise new revenue. It is to protect our people and, ultimately, our treasury from the consequences of smoking. Effective a minute after midnight tonight, we will raise the tax rate by one cent per cigarette and by five cents per gram of fine-cut tobacco.

The single greatest financial improvement in this year’s budget is the impact of the revenue from the Atlantic Accord 2005. Our government looks forward to early passage of the enacting legislation through the Parliament of Canada so that Newfoundland and Labrador can begin to reap the benefits of our provincial share of offshore petroleum revenue and, in particular, the benefits from the advance payment of $2 billion. As I have already stated, achieving this new revenue is a significant reason for the improvement in our fiscal situation. However, the magnitude of our fiscal challenge is such that we cannot afford to squander one precious penny of this revenue. It would not only be unwise, but in fact impossible, to accommodate all the requests for new funding. Rather, we must respect our moral obligation to invest this revenue wisely and strategically in ways that will benefit both current and future generations to the greatest extent possible.

Expenditure Plan

Mr. Speaker, with this budget, we are taking significant new steps to implement our economic growth agenda by investing strategically in programs and initiatives that will nurture opportunities for development in Newfoundland and Labrador. Like our plan last year, our budget expenditure plan for 2005-06 includes measures to shore up our fiscal position and to secure and sustain the social programs on which our people rely.