HAUBRICH: Saskatchewan government can’t ignore its debt problem

Gage Haubrich is the Prairie Director for the Canadian Taxpayers FederationBluster spun up by staffers won’t help the Saskatchewan government dig out of its debt hole.The Canadian Taxpayers Federation took our Debt Clock around the province, raising the alarm about the province’s increasing debt.The Debt Clock is a digital jumbo screen bolted to the side of a cube truck that shows the debt rolling up in real time.It’s a big, bright reminder to provincial politicians that the debt is a problem that must be dealt with. In response to the tour, the provincial government told media that Saskatchewan “maintains the second lowest net debt-to-GDP ratio in Canada and remains a national leader in economic growth.”That statement is the bureaucratic equivalent of sticking your head in the sand. That’s because every other province in the country is also racking up debt. If all your friends decided to max out their credit cards on VIP tickets to Craven, that doesn’t make it a good idea for you to follow suit..Saskatchewan isn’t doing as badly as other provinces, but the provincial debt is still growing and it’s costing taxpayers more every year.Every minute, the provincial debt increases by about $3,300. Every day, it jumps up by almost $5 million.The provincial debt will be about $23.5 billion by the end of the year, or more than $18,000 per Saskatchewanian.The money the government borrows isn’t free. Every dollar borrowed must be paid back plus interest.And every year the government fails to pay back debt, it gets one step closer to going broke. And that’s something that Saskatchewan has been through before.In the 1990s, former premier Roy Romanow hiked the gas tax, provincial sales tax, and business taxes while his government closed 52 hospitals. And it happened because the government had piled on so much debt, year after year, that the province had essentially gone bankrupt..Taxpayers are stuck paying the interest charges on the debt every year. Since the government has been consistently spending too much, it keeps adding to the debt, and the interest bill keeps increasing.When Premier Scott Moe first took over in 2018, debt interest charges cost taxpayers about $414 million per year. This year, debt interest will cost taxpayers $878 million, or more than $700 per person.And every year the government increases the debt, more money is wasted on these interest charges instead of being spent on services. Other provinces’ debt problems are bigger than Saskatchewan’s, but that doesn’t mean we should ignore the problem. It means we should use this opportunity to pay down the debt faster and stop wasting hundreds of millions of dollars on interest charges. And it can be done. Alberta previously paid off all its debt in 2004. And former premier Brad Wall paid off about 40% of Saskatchewan’s debt in a single year. At the time, Wall said his goal was to pay back the debt completely to stop wasting money on interest payments..“I’d like Saskatchewan to have a debt clock with exactly one digit – zero,” Wall said.Saskatchewan can start to get its Debt Clock ticking down by controlling its spending and not blowing its budget every year. The government blew past its planned spending by $970 million in 2024. The government spent more than it said it was going to in nine out of 11 of its main departments. But the government also took in $994 million more in revenue than projected.If the government hadn’t blown its budget on almost every line item, it could have reduced the debt by almost a billion dollars and saved taxpayers millions on debt interest payments.Saskatchewan can’t afford to let the debt go any higher. The government needs to stop blowing its budget and pay back the debt to get the province closer to a Debt Clock with one digit, not 11.Gage Haubrich is the Prairie Director for the Canadian Taxpayers Federation

HAUBRICH: Saskatchewan government can’t ignore its debt problem

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