The Right Choices:
Momentum For Growth and Prosperity
Review of 2005
- Real GDP increased by 1.7% driven mainly by an increase
in mineral exports and modest growth in investment and
- Capital investment increased to over $4.3 billion, up
1.8% over 2004 levels.
- The unemployment rate declined to 15.2% in 2005, the
lowest level since 1981.
Forecast for 2006
- Real GDP is expected to grow by 6.2% driven primarily by
oil and mineral production.
- Employment is expected to grow 0.6% to 215,400 and the
unemployment rate is forecast to decline 0.2 percentage
points to 15.0%.
Fiscal Performance 2005
- $76.5 million surplus versus budget target deficit of
$492.5 million. The improvement is driven largely by higher
oil royalties and Atlantic Accord protection.
- Government ahead of target in eliminating deficit.
Budget Plan for 2006
- $6.2 million surplus forecast.
- $156.0 million savings on debt servicing costs
reinvested into programs.
- $927.0 million expected in royalties and corporate
income tax directly from oil activity.
- No new taxes and only one tax increase. Effective
12:01a.m., March 31, 2006, the tobacco tax rate on
cigarettes will increase by one cent per cigarette and by
five cents per gram of fine-cut tobacco.
- More than a $100 million increase has been allocated for
the Province's education system.
- $5.2 million ($9.1 million annually) is provided to
retain 151 teaching positions that were slated for removal
in 2006-07 and $250,000 for a review of the teacher
- $5.3 million is committed to reduce the age of school
busses, to purchase 67 new busses, and to offset maintenance
and increased cost of fuel.
- Additional operating funding of $32.2 million will be
provided to Memorial University.
- Additional operating funding of $8.5 million will be
provided to the College of the North Atlantic. This
operational funding includes an expansion of the
availability of the Comprehensive Arts and Science College
Transition Program, faculty upgrading, shop modernization,
program development and marketing.
- $1.5 million is provided to ensure our school boards
have adequate staffing resources, in order to effectively
deliver services and supports to individual schools in each
- $150,000 is allocated to review the ISSP/Pathways Model.
- $2.2 million is allocated to provide laboratory safety
equipment and teacher training for schools with grades 7-12.
- $2.0 million is allocated for course development and the
purchase of equipment for schools.
- $1.0 million investment in Physical Education equipment.
- $300,000 for each of the next 3 years is provided to
develop a senior high school Newfoundland and Labrador
- $1.1 million is allocated for a research/training ship
for Marine Institute.
- $125,000 is provided to create a liaison position to
strengthen partnerships between school boards and school
councils and to support volunteer work of parents.
- $250,000 is provided to extend the hours of operation at
42 public libraries.
- $500,000 is provided for the Offshore Safety and
Survival Centre in Foxtrap which provides services to the
offshore petroleum marine transportation and fisheries
- $600,000 of funding is provided to support
Apprenticeship Training Programs at Memorial University and
other government funded entities.
- $270,000 is provided to increase the participation rate
for women in apprenticeship and skilled trades initiatives.
- $20.0 million to be invested over 4 years for the
Innovation Strategy including a Commercialization Fund and
Innovation Enhancement Fund.
- $100,000 is provided for a Skills Task Force to identify
skills gaps and the Province's future skill requirements.
- An additional $16.5 million is provided for White Paper
Initiatives. This includes increased funding for grant in
aid, to allow Memorial University and College of the North
Atlantic to maintain tuition reductions, and other strategic
- Funding of $7.5 million is provided for the Industrial
and Research Innovation Fund as part of a three year
- $54.0 million in dividends to be retained by NL Hydro to
increase the public utility's leverage.
- $1.4 million is provided for support of key energy
policy development initiatives including completion and
implementation of the Provincial Energy Plan, and advice on
energy policy developments.
- $1.5 million is provided to attract and retain
professional staff and expertise in key management and
technical skill areas to enable government to remain
competitive with energy based industries.
- $500,000 provided to prepare the Centre for
Environmental Excellence in Corner Brook for environmental
R&D and commercialization opportunities.
- 34 fees have been reduced or eliminated to reduce
burdens on businesses and individuals for a total savings of
$1.5 million. In addition, the elimination of the Liquor
Licensee Levy will result in savings of $1.95 million for
the beverage industry.
- An additional $7.5 million will be invested for new and
continuing IT projects of the Office of the Chief
- $8.0 million is allocated for the Small and Medium
Enterprise Fund to support business development throughout
- $5.0 million is provided for the continuation of the
Regional/Sectoral Diversification fund.
- An additional $200,000 is allocated for the Ireland
Business Partnerships, thereby increasing its annual budget
- $2.0 million is retained for the Newfoundland and
Labrador Film Development Corporation's Equity Investment
Program. In addition, $550,000 is allocated for core
operational support, representing an increase of $260,000.
Investing in Infrastructure
- There will be an unprecedented investment in excess of
$2 billion to modernize the Province's infrastructure and
continue to grow the economy over the next 6 years.
- $142.2 million has been allocated for a Roads
This Program will include such initiatives as:
- $60.0 million in Provincial Roads Improvement
- $29.7 million in cost shared TCH improvements;
- $25.5 million for Phase III of the Trans-Labrador
- $10.0 million in cost shared funding to extend the
Team Gushue Highway and begin the Torbay By-pass Road,
including $6.0 million for land acquisition;
- $2.0 million for land acquisition for various road
- $15.0 million for Trans-Labrador Highway Phase I
subject to Federal cost shared commitment.
- $12.4 million is allocated for summer and winter
maintenance, including funding to replace heavy equipment,
such as snow plows, and implement a salt management plan.
- $2.2 million is allocated to complete the Chateau Pond
depot on the Trans-Labrador Highway, and renovate the
highway depot in Lumsden and a garage in Eastport.
- $9.0 million is allocated for refits to ferry vessels.
- $6.1 million is provided for the maintenance of wharves
- $1.5 million is provided to initiate design for
construction of two vessels right here in Newfoundland and
- $22.5 million committed to the Municipal Capital Works
Program which will lever further municipal funding.
- Government will administer the $19.8 million federal gas
tax rebate program for municipal environmentally sustainable
- $1.0 million is provided to access funding under the
Canada Strategic Infrastructure Fund II to advance
large-scale infrastructure projects. This is the first
installment in a multi year arrangement that will address
large scale infrastructure projects valued at over $10
- $9.0 million in new commitments for the Municipal Rural
Infrastructure Fund with a focus on projects that improve
the quality of the environment.
- A further $700,000 will be invested under the Canada
-Newfoundland and Labrador Infrastructure Program.
- $18.0 million will be invested in public buildings for
maintenance, reconfiguration, remediation and demolition.
- $12.0 million has been allocated for repairs to
hospitals and nursing homes to address fire and life safety,
occupational health and safety and building integrity
- $2.15 million has been allocated to begin construction
on a courthouse in Corner Brook to better serve the public
in a secure setting.
- Close to $40.0 million is being included in the 2006-07
budget in the health care sector for a number of capital
construction projects including Corner Brook, Clarenville,
and Happy Valley-Goose Bay long-term care facilities; the
Grand Bank Health Centre, health care centre in Labrador
City, renovate a hospital wing at James Paton Memorial
Hospital in Gander, the Cancer Centre in Grand Falls-Windsor
and renovations to the Blue Crest Nursing Home, the
Humberwood Addictions Centre in Corner Brook, and planning
for long term care planning in Lewisporte and St. John's.
- Capital investment in our education system includes
$20.4 million for Memorial University, $8.6 million for
College of the North Atlantic and $37.0 million for the K-12
- Funding is provided to reinstate the commercial weigh
scales in Port Aux Basques and Foxtrap.
- $6.5 million will be provided for capital expenditures
for the College of the North Atlantic including $4.5 million
in investments for the Prince Philip Drive Campus, $1.0
million to enhance the development of a new site in Labrador
West and $1.0 million to begin an extension to the campus in
Happy Valley-Goose Bay.
- $10.0 million will be invested over 3 years in the
Aquaculture Capital Investment Program, beginning with $3.5
million this year.
- The budget for the Seafood Development and
Diversification Program will be increased by $250,000 a year
for 5 years.
- $300,000 per year for the next 5 years will be invested
to implement the Strategy for the Recovery and Management of
Cod Stocks in partnership with the Government of Canada.
- $350,000 is being provided over 2 years to increase the
Province's capacity for coastal and oceans management.
- Elimination of processing licence fee increases is
planned for 2006-07 and 2007-08 and also the elimination of
species surcharge increases planned for 2006-07.
- Allocation of $360,000 for aquaculture industry support,
doubling the investment in the program in this year.
- $265,000 is budgeted to support new initiatives designed
to address seafood trade and market barriers.
- $100,000 is provided to enhance the promotion of the
Province's seafood products and develop a broader range of
international market opportunities.
- An increase of $100,000 is provided for the Strategic
Infrastructure Program bringing the total value of the
program to $300,000. This will assist in upgrading fisheries
infrastructure to improve efficiency, product quality, and
safety in the landing and handling of fish.
- $500,000 is allocated to take the next step to
commercialize cod aquaculture through the creation of a
commercial-scale cod demonstration farm.
- Investments of approximately $9 million in the
agriculture industry including:
- $4.0 million in new funding for the Agrifoods
- $2.0 million for the Provincial Agrifoods Assistance
- $2.3 million for acquisition of agricultural
farmland and construction of agricultural roads;
- $342,300 for the Agriculture Limestone Program to
help enrich the dairy and sod sectors.
- To ensure a healthy wood supply, the budget allows for
$800,000 in new funding to conduct a forest inventory, a
$1.0 million increase in each of the next 3 years for
silviculture initiatives to replenish our resources, and a
$1.0 million increase for forest insect control and fire
- $4.25 million is provided for investment in the
Community Enhancement Program to support the immediate need
for short-term employment of many residents of rural
- $1.1 million will be provided to the Bull Arm Site
Corporation to manage the site and attract more offshore
- $2.5 million is allocated to the Mineral Incentive
Program, an increase of $900,000, to promote mineral
prospecting and exploration activity in the province, plus
an additional $500,000 to conduct more regional geological
- Funding is continued for the Inland Fisheries
Enforcement Program to combat salmon poaching thoughout the
- $100,000 is budgeted to prepare and implement a sealing
industry communications strategy to combat misinformation
about the $40 million a year industry.
Renewing our Commitments to Labrador
- More than $50.0 million in funding is provided to
construct infrastructure in Labrador in 2006-07 as part of
commitments totalling more than $200 million over the next 4
- $325,000 is provided to proceed with development of the
Labrador Transportation Strategy.
- $1.3 million is allocated to implement the Labrador
Inuit Land Claims Agreement.
- $240,000 is provided over two years for an Aboriginal
suicide prevention initiative to be cost-shared with the
- Funding for the Air Foodlift Subsidy has been increased
by one third raising the funding level to $400,000.
- $100,000 represents the second year funding in a three
year commitment for Destination Labrador tourism marketing
- $1.9 million is committed for the provincial
contribution to establish a performance space in Happy
- $759,000 is provided to extend the operation season of
the Straits Ferry Service by 4 weeks.
- Funding is provided to establish Supreme Court circuit
courts for coastal communities to improve access to justice
services in remote areas.
Investing in our Heritage
- $17.6 million has been provided over the next 3 years to
support the continued success and growth of professional
artists and cultural industries with the adoption of the
Province's first strategic cultural plan Creative
Newfoundland and Labrador: The Blue Print for Development
and Investment in Culture.
- $200,000 is provided for the core operational funding
under the Cultural Economic Development Program.
- Increase is provided in the allocation to the
Newfoundland and Labrador Arts Council by $300,000 this
year, bringing its funding to $1.15 million so it can better
support the arts community. The cumulative new investment in
the Arts Council over the next 3 years will be $1.8 million,
which will double the Council's existing budget.
- $2.0 million has been committed to bring our total
tourism marketing budget to $10.0 million.
- $3.8 million has been committed toward improving the
Province's Arts and Culture Centres, Provincial Historic
Sites, regional museums and other cultural institutions,
including the LSPU hall and Colonial Building.
- $125,000 is provided for infrastructure improvements and
interpretation at the Corner Brook Museum, with a total
investment of $325,000 over two years.
- $1.6 million over two years is provided to create
leading edge and technologically-based provincial Visitor
- $482,500 is provided over 3 years to support the
creation and operation of a new Visitor Information Centre
at St. John's Airport in partnership with the City of St.
John's and the St. John's Airport Authority.
- A further $700,000 is committed this year for a total
Provincial contribution of $2.0 million toward the creation
and operation of a new Provincial Training Centre for
- $500,000 has been provided for continued implementation
of the Province's Climate Change Action Plan and $1.0
million has been earmarked for the clean up of selected
contaminated sites throughout the province.
- $3.0 million will be provided over 2 years to assess the
status of 10 of the Province's major Caribou populations.
- $1.0 million will be provided to make various
improvements to several Provincial parks.
- $259,000 has been provided to continue the Natural Areas
Reducing Poverty and Increasing Self Reliance
- $8.3 million this year, and $32.8 million annualized is
provided to extend eligibility for the Newfoundland and
Labrador Prescription Drug Program to more low
- $430,000 in 2006-07 ($570,000 annually) is provided to
extend Income Support to clients starting a job during the
first critical month, and simplify the process for reporting
- An additional $500,000 in funding is provided to
continue employment development.
- $1.5 million in 2006-07 ($2.0 million annually) will be
provided for new skills development courses.
- $6.3 million will be provided to increase the
instructional grant to school boards and to cover prescribed
workbooks and consumable materials currently charged to
- $250,000 will be spent to implement new school
guidelines to promote healthy eating. In addition, $500,000
will be invested in the Kids Eat Smart Foundation.
- $250,000 will be committed to provide continued support
of the Jumpstart Program.
- $500,000 is earmarked for a rental rebate for tenants of
Newfoundland and Labrador Housing for residents attending
levels 2 to 4 in high school or post-secondary school.
- The investment in adult basic education is increased by
$1.2 million to expand the number of courses. $228,000 is
provided for the review of the adult basic education
- $5.6 million in 2006-07 ($7.4 million annually) will be
invested to increase income support rates by 5% effective
July 1, 2006.
- An additional $3.0 million will be provided each year to
index income support rates with the consumer price index for
six years starting in 2007-08
- $2.1 million in 2006-07 ($2.8 million annually) will be
provided to increase additional assistance for shelter rate.
- For families with children with disabilities, $2.25
million has been provided to increase access to the Special
Child Welfare Allowance Program.
- A further $1.1 million to strengthen the provincial
legal aid system is also budgeted. This includes 2 lawyers
and 1 administrative support person for Happy Valley Goose
Bay which is consistent with the recommendations of the
Aboriginal Law Project Report. This funding will also
provide an additional 2 lawyers and 1 administration support
person for other areas of the province and operational
- Total funding for Women's Centres is increased by
$80,000 per year.
Ensuring Safe and Secure Communities
- Investment of $3.1 million will be made to strengthen
the police presence throughout the Province, including
hiring 9 new RCMP officers, filling 9 vacant regular member
positions, creating 8 new RNC constable positions, and
creating a new RNC dog unit in Corner Brook.
- Approximately $6.9 million is provided for the
operations of the RCMP and RNC, including 5 new
administrative positions, 4 new civilian dispatchers, 2 RCMP
Operational Communication Centre positions, 2 RCMP public
service positions in Labrador, and various other operational
- $100,000 is provided for Sex Offender and Spousal Abuse
Treatment Programs .
- An investment of $219,500 is made to expand court
security in Happy Valley-Goose Bay, Wabush and Grand
- Funding is provided for 55 new child, youth and family
services positions over the next 3 years, beginning with a
new investment of $1.5 million in 2006-07.
- An additional $305,000 is provided to support transition
homes in Labrador West, Hopedale and St. John's.
- $1.25 million is provided to support Government's new 6
year action plan on violence prevention.
- Total current and capital investment is increased by
$180.0 million compared to last year.
- In excess of an additional $60.0 million will maintain
core health and community services through Regional
Integrated Health Authorities.
- $15.6 million in new funding will be invested to help
prevent and treat cancer. This includes:
- $3.3 million to construct 2 new bunkers to house 2
new radiation treatment machines at the Dr. H. Bliss
- $1.5 million to enhance the Provincial Cervical
- $750,000 for breast cancer screening centres in
Grand Falls-Windsor and St. John's and other program
- $6.4 million to introduce new treatment therapies
for colorectal cancer and multiple myeloma; and
- $3.6 million to cover cancer medications.
- $6.0 million is provided to bring the personal care home
subsidy rate from $1,138 to $1,500 effective July 1, 2006,
and to provide additional subsidies.
- $2.7 million is provided to reduce wait lists for home
support for seniors and persons with disabilities.
- $1.7 million will be invested to add new medications to
the Provincial formulary such as medications to treat
Alzheimer's, anemia from cancers, among other disorders.
- $1.5 million is allocated to address growing demand for
services at existing sites. Government will proceed with 3
new renal dialysis units on the Burin Peninsula, in Happy
Valley-Goose Bay and in St. Anthony.
- $3.7 million is provided to support implementation of
the Provincial wellness plan Go Healthy, an increase of $1.3
million this year.
- $1.0 million is allocated to enhance primary mental
- $1.0 million is provided to add 9 new addictions
counsellors and to respond to needs identified in the
Gambling Prevalence Survey.
- $4.6 million is allocated to strengthen public health
including hiring 39 public health nurses over the next two
years and enhancement of animal health services.
- $11.2 million is invested in new hospital and long term
care equipment including the construction of the two bunkers
for the radiation units and $1.2 million for the new
- $4.1 million has been allocated to improve the
effectiveness of the children's Dental Program to ensure
children are able to take full advantage of the program.
- $651,900 is provided to increase the rate paid to
caregivers of children in care by 15% over the next 3 years,
beginning with a 5% increase this year.
- $227,000 is provided for alternate family care
providers, who care for persons with developmental
disabilities, to receive an increase of 15% over the next 3
- $350,000 in funding to provide coverage of pediatric
enteral nutrition for children with severe bowel diseases,
such as Crohn's and Colitis.
- New funding is provided to enable people, for the first
time, to benefit from in vitro fertilization procedure
without having to leave the province.