2004 –2005 Saskatchewan Provincial Budget

The Hon. Harry Van Mulligen Budget and Performance Plan Summary Minister of Finance Minister’s Message

I am pleased to table the 2004-05 Budget and supporting documents for public review and discussion.

This document provides more than just budget numbers. It includes comprehensive reports on both our fiscal and economic outlook, which forms the context and foundation for the 2004-05 Budget. I would like to point out two sections that are particularly relevant in this year’s Budget. First, a technical paper that discusses federal transfers, one of our most challenging issues. Secondly, a section that examines health care funding. Health care represents our most rapidly growing expenditure area. This section of the report outlines how this money is being spent and the ongoing funding needs required to maintain the current health system.

I also encourage you to review the government-wide performance plan summary that sets out the broad vision and goals for government departments. Individual plans, with detailed goals and objectives, are also available on each department’s website. These performance plans are one further step in our ongoing commitment to improving accountability of this Government to the people of Saskatchewan.

It is my hope that the material found in these documents will help create a solid understanding of our economy, our finances, and Saskatchewan’s future.

Harry Van Mulligen Minister of Finance Table of Contents

INTRODUCTION AND OVERVIEW Performance Plan Summary ...... 4

TECHNICAL PAPERS Health Care Spending in Saskatchewan ...... 20 Equalization ...... 26 Saskatchewan’s Economic Outlook ...... 32 Saskatchewan’s GRF Financial Outlook ...... 38 2004-05 Revenue Initiatives ...... 43 Saskatchewan’s Tax Expenditures ...... 46 2004 Intercity Comparison of Taxes and Household Charges ...... 51 2004-05 Borrowing and Debt ...... 55 Fiscal Stabilization Fund ...... 61 2000-01 to 2003-04 Four-Year GRF Financial Plan Results ...... 62

GENERAL REVENUE FUND (GRF) BUDGET DETAILS (FINANCIAL TABLES) GRF – Statement of Operations ...... 64 GRF – Statement of Cash Flow ...... 65 GRF – Schedule of Revenue ...... 66 GRF – Schedule of Expense ...... 67 GRF – Schedule of Debt ...... 68 GRF – Schedule of Borrowing Requirements ...... 70 GRF – Schedule of Guaranteed Debt ...... 71

SUMMARY FINANCIAL BUDGET DETAILS (FINANCIAL TABLES) Accounting for Capital Assets ...... 74 Summary Statement of Surplus ...... 76 Summary Statement of Changes in Net Debt ...... 78 Restatement of Net Debt and Accumulated Deficit ...... 78 Summary Statement of Financial Position ...... 79 Summary Statement of Debt ...... 80 2004 –2005 Saskatchewan Provincial Budget

Performance Plan Summary 4 Budget 2004-05 | Budget and Performance Plan Summary document. Performance Plans these plans,refertothe its statedpriorities.To findoutmoreabout department’s progressovertimeinachieving help thepublicmonitorandevaluateeach performance measuresandbaselinedatato coming year. Departmentplansalsoinclude other importantinitiativesplannedforthe more detailaboutthesestrategiesandmany Budget. Theseplansprovidethepublicwith key, cross-governmentstrategieswiththe Tr performance plansfordepartments,some For thefirsttime,Governmentisreleasing • • •A three overridingthemes: strategies plannedfor2004-05insupportof opportunities, andhighlightsthekey accomplishments andcurrentchallenges The Government’s plantouchesuponpast government performance. the publicand,ultimately, improved decision-makers, enhancedaccountabilityto and betterinformationformanagers progress andreportingbackwillleadtomore and accountability. Preparingplans,tracking continuing effortstoimprovetransparency This planispartoftheGovernment’s Introduction easury BoardCrowncorporationsandtwo Healthy andSelf-reliantFamilies Strong andVibrant Communities

Green andProsperousEconomy section includedinthis Contacts for plans. Government’s planandindividualdepartment the prioritiesandinitiativesoutlinedin be usedtocontinuallyre-evaluateandrefine gathered throughthereportingprocesswill will bereleasedinJuly2005.Information their plansin2004-05AnnualReports,which report backonactualresultscomparedto 2004 Mid-Year Report.Departmentswill provide thepublicwithastatusreportin planned strategiesandinitiativeswill Government iscommittedtofulfillingthese Budget and Performance Plan Summary | Budget 2004-05 5 Assessment of Investment Saskatchewan July 2003) concluded that Invest in Saskatchewan Program, enture Capital Corporations. In the coming years, In the coming years, sector management of its will seek private to build pools of private assets and continue capital to further grow the and public sector economy. is key to A competitive business structure KPMG continued economic growth. A 2004 study on international cost-competitiveness cities major confirmed that Saskatchewan’s other continue to compare positively to jurisdictions when it comes to doing business. Saskatchewan offers numerous incentives that to create and nurture an environment grow and allows businesses of all sizes to The prosper. for example, encourages Saskatchewan in funds employees and individuals to invest or pools of capital called Labour-Sponsored V Investing in infrastructure today and planning for tomorrow is key to Saskatchewan’s continued competitiveness as a place to do business. A report commissioned by Government last year ( Public Competitiveness of Saskatchewan’s Infrastructure, public infrastructure fares Saskatchewan’s well in comparison to other jurisdictions. A modern, safe, efficient and reliable transportation system is particularly important in meeting the future needs of the economy and on this front, the Report noted that Saskatchewan has a world-class principal road network connecting all major centres in has a A Green and Prosperous Economy and Prosperous A Green Investment Saskatchewan Inc., Saskatchewan’s economy is performing well, economy Saskatchewan’s of the agriculture sector with the exception challenges from drought which has faced discovery of a single case conditions and the (BSE). of Bovine Spongiform Encephalopathy for the Saskatchewan set records in 2003 number of people working, the number volume of oil and gas wells drilled and the remains of potash sales. The future outlook positive. to Our farmers and the economy continue of them face difficult circumstances, many have a beyond our control. These challenges direct impact on the lives of Saskatchewan economy, citizens, and on our communities, future of budgets and ability to shape the this province. The Government remains in committed to providing and participating our a number of programs to support agri-food producers and the agriculture and The highest agricultural priority industry. right now is working with the livestock other provinces and the federal industry, government to open the borders to the export of Saskatchewan livestock. In Saskatchewan, Crown corporations and Crown investments play an important role in helping to build a green and prosperous new investment The Province’s economy. Crown, long-term mandate to enhance Saskatchewan’s economic growth and diversification through the provision of investment, capital and financing. 6 Budget 2004-05 | Budget and Performance Plan Summary early 2005. W Corporation hasplansfor aprojectin Lloydminster. NorAmeraBioEnergy of a130millionlitreethanolfacilityin Energy intendstoproceedwithconstruction February 2004announcementthatHusky development ofabiofuelsindustrywiththe A majorstepwasrecentlytakentowardthe support anexpandedcattlefeedlotindustry. environment andprovideby-productsto the economy, contributetothehealthofour Ethanol productionisexpectedtodiversify important partofourefforts. Ethanol ProductioninSaskatchewan green economyandthe2002 Saskatchewan isalreadyworkingtobuilda in anenvironmentallyresponsibleway. climate foreconomicgrowth,itmustbedone While Governmentiscreatingapositive to majortradecorridors. access keycommercialroutesandconnect producers, suppliersandmanufacturersto system andpolicyframeworkwhichallows an efficientandcompetitivetransportation At thesametime,wemuststrivetoprovide heavily onthetruckingindustry. modern transportationlogisticsthatdepend from therailsystemtoroadnetworkand transferred anenormousamountoffreight geography, federalpolicychangesthathave sustain theexistingroadsystembyour However, weareconstantlychallengedto economic andsocialdevelopment. regional highwaysthatfurthersupports has anextensivenetworkofsecondaryand the provincetomarkets.Saskatchewanalso eyburn, expectedtobeoperational in Greenprint for is an province. sectors onbuildingabetter futureforour collective effortsoftheleaders ofthese first work, investanddobusiness. Thisyear, the Saskatchewan agreatplaceinwhichtolive, every levelofgovernment,andstrivetomake co-operatives andcommunities,labour prosperous economywithbusinesses, new partnershipstohelpbuildagreenand The Governmentwillmaintainandestablish the standardsforenergyefficiency. buildings withanewpolicydesignedtoraise lead inmandatingenergyefficiencypublic emissions. Saskatchewanhastakenanational governments andtoreducegreenhousegas consumers, businesses,communitiesand conserving energytoreducecostsfor The Governmentisalsocommittedto electricity topower70,000homes. emission energy, producingenoughgreen generate about150megawattsofzero power generation.Thenewprojectwill to undertakeamajorexpansionofwind SaskPower isalsopartneringwithATCO Power Cypress Facilitywasexpandedlastyear. the growingdemandforGreenPower, the southwestern Saskatchewan.Inresponseto owned CypressWind PowerFacilityin by twofacilities,includingSaskPower’s wholly combined capacityof22megawattsgenerated wind powergeneratorinCanada,witha Saskatchewan iscurrentlythethirdlargest and energyconservationprogramming. small-scale EnvironmentallyPreferredPower focusing onthreemainareas:windpower, of theGreenPowerPortfolioInitiatives, Saskatchewan greenwiththeimplementation Our Crownutilitiesarehelpingtokeep Saskatchewan Summit will focusthe Budget and Performance Plan Summary | Budget 2004-05 7 Continue to focus on the development agenda for agriculture and rural Saskatchewan while being attentive to current industry difficulties, with initiatives that are consistent with the fiscal capacity provincial government’s and goals represented at all occupational levels in all represented at all partner date, through the AEDP, sectors. To hired more than 1,700 employers have people. qualified Aboriginal works with the federal Saskatchewan also First Nations to implement government and Settlement Land Entitlement (TLE) the Treaty leads to greater economic Agreements. TLE Nations and social independence for First and provides economic development Province opportunities for all people in the through substantial economic investments terms of into rural Saskatchewan. Under the Entitlement the 29 existing TLE Agreements, First Nations will receive approximately just over $539 million over 12 years to buy to their two million acres of land to add reserves. support our Immigration is an instrument to We economic and labour market objectives. work with other governments, employers, to immigrant organizations and communities immigrants. help effectively recruit and retain The Saskatchewan Immigration Nominee number Program is working to increase the and range of immigrants to our province and break down the barriers that can impede an ability to contribute to their immigrant’s maximum potential. In 2004-05, the target will be about Government’s 300 nominees. STRATEGIC PRIORITIES IN 2004-05 STRATEGIC • achieve our vision of a green and

prosperous economy, we must realize the prosperous economy, citizens, potential of all Saskatchewan’s and the Government remains committed to ensuring Aboriginal people are actively engaged in the economic and social life of the province. The Aboriginal Employment Development Program (AEDP), for example, strives to build a workforce in Saskatchewan where Aboriginal people compete for jobs based on their skills and qualifications, and where they are The investments we make each year in social The investments positive impact on the lives programs have a youth and families, and on of our children, Our Building economy. the Saskatchewan has helped over Independence program almost 6,800 families, including reduce their reliance on 15,000 children, and become more self- social assistance jobs and contributing sufficient by getting to the economy. effective; Reforms to date have proven highly the lowest it the social assistance caseload is in this has been in over a decade. Initiatives reaffirm our Budget build on our success and families commitment to helping low income of life. and individuals improve their quality with the The Government, in partnership industry, education and training sector and plays a key role in preparing Saskatchewan people to take advantage of economic and opportunities. Increased globalization change competitiveness, rapid technological a and a diversifying economy are driving growing demand for post-secondary with over education in the labour market, 60 per cent of new jobs requiring some post-secondary education. To 8 Budget 2004-05 | Budget and Performance Plan Summary • • • • •P • • ~ ~ CFI hasendorsedprojectssuchas: as theNewOpportunitiesFund.Recently, by CFIundertheirInnovationFundaswell provide matchingfundsforawardsmade The additionalfundingwillbeusedto Canada FoundationforInnovation(CFI). Province tomatchfundingapprovedbythe research prioritiesandbetterenablethe Science FundtosupportGovernment Increase fundingtotheInnovationand applications hundreds ofspin-offjobsinassociated for researchersandthepotential Source Synchrotron,creatingdirectjobs Begin operationoftheCanadianLight that supportinternationaltrade T progressive weightregulations,the Improve transportationefficiencythrough activity andfuturegrowth transportation routestosupporteconomic developing keycommercialandruralgrain resurfacing andtwinningaswell through strategicinvestmentsinpavement Continue improvingtheroadnetwork government andnorthernpartners Agreement inconjunctionwiththefederal through theNorthernDevelopment enhance localeconomicdevelopment Capital Corporationtaxcreditprogram Enhance theLabour-Sponsored Venture employment growthpotential opportunities withsignificantwealthand annually incommercialinvestment to investanestimated$50million Investment Saskatchewan rovide opportunitiesfornorthernersto rucking PartnershipProgramandpolicies Process and Impact Research Facility (TAF) forEnvironmental University ofRegina: Canadian LightSourceSynchrotron Therapy (BMIT);andBeamline atthe (INTERVAC); BioMedicalImagingand International Vaccine Centre University ofSaskatchewan: Tr has amandate ace Analysis •T • • • • construction sector 3,200 personyearsofemploymentinthe new constructionandrenovation, This willgenerateabout$300millionof Centenary AffordableHousingProgram. in 2,000housingunitsunderthe The newfive-yearHousingplanwillresult National EnergyCodesforBuildings that are25percenthigherthanModel Housing planwillbebuilttostandards construction underthenewfive-year Ownership Program.Aswell,newhome through theNeighbourhoodHome $1,500 forfamiliesacquiringhomes conservation renovationgrantsofupto The planalsoprovidesenergy operating costsby$1millionperyear. 10 percentby2007.Thatwillreduce subsidized housingportfolioby reduce energyconsumptionofitsseniors for EnergyConservationStrategy, will support oftheProvince’s Greenprint Conservation Opportunitiesplan),in the Corporation’s ECOplan(Energy Saskatchewan HousingCorporation; owned andmaintainedbythe Improve energyefficiencyinhousing A ten-fold throughajointventurewith SaskPower’s windgenerationnearly Continue withplanstoexpand and thelabourmarket Aboriginal peopleineducation, training Increase theparticipation andsuccessof extended tomorefamilies Health Benefitsprogramwillalsobe eligibility forcoveragethroughtheFamily a broaderrangeofincomes.Inaddition, increased andextendedtofamiliesacross the EmploymentSupplementwillbe to lowincomeworkingfamiliesthrough be enhanced.Financialbenefitsavailable people fromsocialassistancetojobswill wo programsthatsuccessfullymove TCO Power Budget and Performance Plan Summary | Budget 2004-05 9 Open Up Saskatchewan!, rants and contracts that enable community-based organizations to deliver community-based organizations front-line programs including women’s shelters, child care centres, small many business loans associations and more. Develop an aggressive immigration Develop an aggressive on based strategy, and range of to increase the number and support immigrants to Saskatchewan to the province immigrants to contribute potential to their maximum •G a new planning we established Recently, municipal and decision-making forum with key leaders to address and co-ordinate this forum, municipal issues. The partners in of SUMA, SARM and the Government a protocol Saskatchewan, will jointly develop and develop to guide the working relationship and approve a set of priorities for consideration. Priorities will likely include economic development, infrastructure, and a consolidated municipal act. Saskatchewan is blessed with an abundance of natural resources and a clean and healthy environment. But while our overall environmental quality is good, we must continue to monitor and address issues such as the ecological and public health risk from the potential effects of pollutants and contaminants, and support communities in addressing their specific environmental concerns such as those related to waste management and the clean up of contaminated sites. • Strong and Vibrant Communities Strong and Revenue-sharing grants, which help capital communities meet operating and in needs and strategically assist them governing and meeting the needs of their residents; Grants-in-lieu of taxes for provincial government properties owned by the Saskatchewan Property Management Corporation; Cost-shared programs for infrastructure, such as the Canada-Saskatchewan Infrastructure Program which is providing $170 million over five years to develop, renew and enhance infrastructure, particularly green municipal infrastructure such as water and wastewater projects; Grants to provide transportation services to persons with disabilities; and, Increase the responsiveness of the Increase the responsiveness industry skill needs, learning sector to of apprenticeship including expansion training opportunities The Government of Saskatchewan is working The Government of Saskatchewan in to support strong and vibrant communities government, partnership with other levels of First Nations and Métis people, businesses, people. community organizations and young Strong, stable and responsive municipal economic governments are integral to our the Province and social progress. Each year, supports municipalities through: • • • • • 10 Budget 2004-05 | Budget and Performance Plan Summary services. Eachyear, the Governmentmakesa to participateinthedelivery oftransportation increase thecapacityof northern residents northern communityaccessroadsand Government isalsoworkingtoimprove TMS highwayswithalengthof530km. manage trafficon22sectionsof partnerships with40municipalitiesto over 1000kmofpavementsanddeveloped paved standard.TheProvincehasresurfaced 12 TMScorridorshavebeenupgradedtoa thin membranesurface(TMS)roadsand system. Overthelastthreeyears,750kmof safe, sustainableandefficienttransportation to addressthesechallengesanddevelopa planning committees,producersandindustry with localgovernments,areatransportation Increasingly, weareworkinginpartnership infrastructure. placing newpressuresontheexistingroad transportation infrastructuredemandsand is changingtrafficpatterns,creating agriculture tovalue-addedprocessing.This away fromitshistoricemphasisonprimary Saskatchewan’s ruraleconomyisdiversifying health, educationandsocialservices. communities whileprovidingsafeaccessto highways helpsconnectfamiliesand Our transportationnetworkofroadsand these communities. and visitorssupporteconomicgrowthin will improvethequalityoflifeforresidents revitalization ofWascana LakeinReginathat Prince AlbertandSaskatoonthe supporting twokeyriverfrontprojectsin point forcommunityactivity. TheProvinceis Urban parksandgreenspacesareafocal • • • • • Strategies tokeepcommunitiessafeinclude: public concernsaboutissuesofsafety. and increasedtechnologyallcontributeto increased demandsoncorrectionalprograms and inthesocialstructureofprovince, priority. Crimerates,changesintheeconomy Keeping communitiessaferemainsatop library systemsacrossSaskatchewan. electronic accesstoeducationprogramsand knowledge. CommunityNetprovides communities, bigandsmall,totheworldof importance oftechnologyinconnectingour There isalsogrowingrecognitionofthe communities valuedat$2.7million. agreements withnortherncontractorsand Province hadover100contractsor in northernSaskatchewan.In2003,the and improvehighways,bridgesairports significant investmenttopreserve,operate system; communities expectofthe correctional achieve thedesiredoutcomes that service forlow-risk/low-needoffendersto individuals anddefiningabasiclevelof system onhigh-riskandhigh-need Focusing theresourcesofcorrectional and effective,earlyinterventions; Using targeted,integratedapproaches public safetyissues; preparedness andcitizenawarenessof Enhancing municipalcapacity, emergency within Aboriginalcommunities; to reduceoffendingandvictimization Aboriginal peopleandthejusticesystem Changing therelationshipbetween to solvesocialproblems; Reducing relianceonthejusticesystem Budget and Performance Plan Summary | Budget 2004-05 11 rovide a further $10 million, a 13 per cent increase over last year, in 13 per cent increase over last year, revenue sharing grants for northern, rural and urban municipalities to help address operating and capital needs, building on the incremental $10 million provided in each of the last two budgets Lake deepening Complete the Wascana project to upgrade the lake for future use and enjoyment. The excavation work will be done by March 31, 2004 and finishing work will be carried out in 2004-05 • STRATEGIC PRIORITIES IN 2004-05 STRATEGIC •P important skills that lead to future success in important skills skills as decision-making, adulthood. Such and team skills, that are problem solving, measure through developed in significant culture and recreation, participation in sport, to social and job attachment. are fundamental in 2005 will Centennial Saskatchewan’s for economic growth, provide opportunities a renewed legacies for our communities and of sense of pride in our province. Funding Centennial $19 million is being provided for through initiatives over a three-year period, the Community Initiatives Fund. the In addition to those local activities, House – Province is renovating Government opened a major addition will be finished, year. and celebrated during the Centennial some The Province will also be supporting Canada signature events, including the 2005 that Summer Games. The volunteer spirit once again Saskatchewan is famous for will and be on display as the people of Regina and surrounding area offer their time and enthusiasm in planning, organizing by the staging an event to be remembered approximately 10,000 visitors expected to attend the Games. outh Y is fully implemented; Ensuring our young offender programs Ensuring our young the needs of offenders effectively address as the federal in the community Criminal Justice Act Criminal Justice and, justice system to reduce Streamlining the delays and costs. continue working with Aboriginal people continue working with Aboriginal are also working collaboratively with are also working

• • We partners at the local level to address Auto community-specific issues. The Regina how Theft Strategy is one example of are municipal and provincial governments issues working together to tackle common success of and find the best solutions. The in this and other crime reduction strategies Saskatchewan is due to community partnerships and co-operative planning. We of in a variety of ways to address issues the victimization and offending, including on First establishment of The Commission Reform Nations and Métis Peoples and Justice its final in 2001. The Commission will release work with report in June 2004 and we will Aboriginal communities and organizations final to respond to the Commission’s recommendations. A growing body of research is emerging that demonstrates the key role that arts and culture play in the development of community cohesiveness and economic growth. Based on this evidence, the Province is committed to strengthening the arts and cultural sectors and is focusing its strategic efforts on creating an environment where artists and arts and cultural organizations can thrive. Research evidence is also clear that, simply by participating in well supervised and designed sport, culture and recreation activities, young people can develop 12 Budget 2004-05 | Budget and Performance Plan Summary • • • •P • • use andtheenvironment risk topublichealth,sustainableresource enforcement activitiesonareasofgreatest enforcement unittofocuspreventionand Establish aspecializedenvironmental televisions, etc.) home electronics(computers,stereos, initiatives intwonewareas:paintand Expand productstewardshiprecycling resource use from pollutionandunsustainable costs tocorrectenvironmentaldamage environment andtoavoidunnecessary economic andsocialbenefitsfromthe actions undertheplanaimtosustain Implement theBiodiversityActionPlan; improvements andtransportationservices transportation infrastructure improvements transportation infrastructure on ruralhighwaysandundertake and theprivatesectortomanagetraffic Develop partnershipswithmunicipalities residents inthetransportationsector employment opportunitiesfornorthern groups andcommunitiestoenhance infrastructure andworkwithnorthern Improve northerntransportation rotect theenvironmentindeliveryof • • • • the Aboriginalsportsystem activities andstrengthenthecapacityof and recreationorganizations of Aboriginalpeopleinourmanyculture Increase theleadershipandparticipation of aprovincialculturalpolicyframework the artistinitiativesandestablishment sectors throughdirectfunding,statusof Increase supportfortheartsandculture by theendof2005] reduced by50percentofthe2001levels, new targetthatwillseeautothefts [Auto TheftStrategypartnershaveseta successful ReginaAutoTheftStrategy reduction initiatives,suchasthe Continue tosupporttargetedcrime initiated Commission havebeencompletedor Government ofSaskatchewanbythe All recommendationsdirectedatthe 2004-05 SafeDrinkingWater Strategy. Commission ofInquiry, asoutlinedinthe recommendations oftheNorthBattleford Continue implementationofthe Budget and Performance Plan Summary | Budget 2004-05 13 the in motion, A Physically Active In the coming year, the Government will also the Government In the coming year, promotion and disease focus on health people to take more prevention by asking promoting and protecting assertive roles in legislation will introduce their own health. We across that will ban smoking in public places develop a the province by 2005. And we will and support comprehensive strategy to assess including people with cognitive disabilities, disorder children with fetal alcohol spectrum – commonly referred to as FAS. (FASD) health and is Physical activity promotes good of our therefore key to the overall well-being Department children, youth and families. The and Recreation has of Culture, Youth developed a plan together with community levels of partners to increase physical activity points Saskatchewan people by 10 percentage by 2010. Saskatchewan provincial health promotion four-year program launched in April 2003, is part of the overall plan to get Saskatchewan on the move. The Government will also continue to work with the newly formed Saskatchewan Physical Activity Council to manage the implementation of Saskatchewan Strategy. Safe and affordable housing is another important part of our efforts to promote independence and self-sufficiency among Saskatchewan families. The Government is introducing a new Housing plan this year that will help thousands of low-income families to access quality and affordable homes. Homes allow families to build their independence Healthy and Self-reliant Families Healthy Action Plan for Saskatchewan (December 2001), the Accessible, quality health care is a top Accessible, quality of every operating dollar is priority – 44 cents services. Significant spent on health made each year to improve investments are the health and self-reliance of families. will The health budget increase this year health patient-focused support a high quality, care system and further distinguish in health Saskatchewan as a national leader will enable us care. Investments in health care to continue with important initiatives outlined in the Health Care blueprint for a sustainable Government’s health care system. year Strategic priorities for the coming of primary include the ongoing development Province to health care networks across the services offer a full range of everyday health health to communities, keeping and attracting professionals, and doing more to reduce waiting times for surgery and diagnostic imaging. increase in the health budget comes This year’s at the expense of enhancing other important areas. And regardless of the level of funding available for health care, there will always be demands to do, and spend more. That is why we will continue to work with our partners in the health system, and with communities, to implement structural changes to move towards a more efficient, more affordable health this Budget, we will be initiating a system. With more appropriate rationalization and allocation of health services based on available resources. 14 Budget 2004-05 | Budget and Performance Plan Summary retention and success.Forexample, programming thatworkstopromote their special needslearnersthrough innovative Additional supportisprovided forat-riskand better jobopportunities. skill requiredtoaccesshighereducationand levels andhealth.Literacyisafoundational educational level,employmentrates,income There isapositivecorrelationbetween student supportsisalsooffered. and graduateuniversitylevel.Arangeof work-based, basiceducation,undergraduate technical/vocational, apprenticeship, opportunities isprovided,includingK-12, A broadarrayofeducationandtraining granted annually. and 1,000journeypersoncertificatesare 4,400 certificate/diplomas,4,300degrees About 12,000Grade12certificates, and 500,000librarypatronseachyear. sector servesanestimated300,000students communities andyoungpeople.Thelearning improving thelivesofourfamilies, The learningsectorisanessentialelementin among Crownutilities. emphasis ontheco-ordinationofratechanges Review Panelandwillinvolveagreater of thecurrentmodelSaskatchewanRate Meeting thiscommitmentwillrequireareview package ofbasicutilityratesinCanada. now andintothefuture,lowestcost ensuring thatSaskatchewanfamiliesenjoy, province. ThisGovernmentiscommittedto important roleinthesocialprogressofthis Our Crowncorporationsalsoplayan are made. strengthened asthesehousinginvestments Communities acrosstheprovincewillbe and providestabilityfortheirchildren. phased-in over fouryears. Saskatchewan followinggraduationwill be post-secondary graduates workingin resources. Anenhanced tax rebateforall start-up enterprisesaccess muchneeded will helpcommunity-based, smalland School in thecommunity. student learningathome,intheschooland with familiesandthecommunitytoenhance community schoolsworkinpartnership Aboriginal organizationsandgovernments. organizations, schools,healthauthorities, among families,communities,community accomplished throughinnovativepartnerships of vulnerablefamiliesexists.Thisis the provincewheregreatestconcentration support tofamiliesincommunitiesacross vulnerable childrenbyprovidingintensive growth anddevelopmentofourmost The opportunities foradults. their families,aswelladvancedlearning social andjusticeservicesforchildren include health,nutrition,recreation,culture, youth andtheirfamilies.Thesesupportsmay support andcommunityforallchildren, focuses onschoolsascentresoflearning, Y building ofagreenerSaskatchewan.The bring togetheryoungpeople,jobsandthe Saskatchewan’s GreenTeam Crown sectorandnew, innovativeprograms. people throughmajorinvestmentsinthe opportunities hereathomeforouryoung Saskatchewan youthbycreatingmoreattractive efforts tobuildabrightfuturefor Over thecomingyear, wewillcontinueour successful inschoolandlife.School children andyouthwhattheyneedtobe oung EntrepreneurofSaskatchewan KidsFirst Plus is aboutgivingSaskatchewan's program supportsthehealthy is designedto program Plus Budget and Performance Plan Summary | Budget 2004-05 15 Continue to develop primary health care Continue to develop the province, networks throughout of everyday health offering a full range services recruitment and Improve retention, professionals including training for health the Nursing Education the expansion of Program tobacco use and Continue to reduce exposure to tobacco smoke in Saskatchewan levels Increase the daily physical activity a of Saskatchewan residents, with particular focus on school-based programs units by Develop 2,000 affordable housing 2008 for low-to-moderate income a focus on home households. With to achieve ownership, families will be able for independence and provide stability their children of Improve affordability and quality housing by developing a new family housing supplement for 10,000 families begin with children. Implementation will in 2005 Develop and deliver new renovation programs that will work with the family housing supplement, targeted at areas of high need such as inner cities and the north, to improve housing quality and attract private investment. The programs will be directed to low-income seniors, families and persons with disabilities who live in housing that requires renovations to enhance quality of life Release a comprehensive disability strategy and develop a number of program enhancements including a new disability shelter supplement that will provide a new benefit to 1,000 households who face high housing costs due to a disability of an adult member • • • • • • • • he Provincial Youth Advisory Committee, he Provincial Youth Continue to implement and refine surgical Continue to implement and refine waitlist management including the for identification of target time frames surgical procedures based on assessed patient need Increase funding to expand diagnostic imaging capacity (MRI and CT scans) in Saskatchewan and begin development of a long-term strategy to address the growing demands for diagnostic imaging services Increase funding to the Saskatchewan Cancer Agency to address priority operating pressures including increased costs of providing cancer treatments (drugs, equipment, staffing), increasing costs of service contracts, the rising number of cancer cases, and the growing number of patients living longer with cancer Saskyouth.net, a central website providing Saskyouth.net, a central website information and resources for young people; and, The Centennial Student Employment of Program, which will support creation to over 500 jobs for young people related their fields of study and career goals. which provides feedback and advice to which provides feedback and advice young Government on issues affecting people; STRATEGIC PRIORITIES IN 2004-05 STRATEGIC • • • • • The Government continues to engage in The Government and about youth and youth consultations with are emerging: job skills, issues. Six key issues economic growth, transition to employment, youth engagement and entrepreneurship, quality of life. has launched three new The Government job skills, job transition programs to address and youth engagement: •T 16 Budget 2004-05 | Budget and Performance Plan Summary •C • • • • • •P child welfareservices and FamilyServicesagenciestodeliver support thecapacityofFirstNationsChild In addition,$1millionisallocatedto children asanalternativetofostercare. extended familiestoassumecareof Kinship Care,toincreasethecapacityof Develop newservicedeliverysupportsfor for 4,000workingparents providing upto$35moreeachmonth increased forsingle-parenthouseholds, The SaskatchewanChildBenefitwillbe March 2003todevelop1,200newspaces part ofafour-year planannouncedin licensed childcarespacesin2004-05, child caresystembydeveloping200new Province willcontinueexpandingthe Under ChildCareSaskatchewan,the Further advanceSchool Literacy Strategy Begin implementationofaProvincial to schoolagedchildrenandtheirfamilies community-based, school-linkedsupports outlined inthe2004-05 Province wheretheneedisgreatest,as families incommunitiesacrossthe children, prenataltoagefive,andtheir on behalfofSaskatchewanfamilies Saskatchewan’s familiesisbeingachieved package ofbasicutilitiesfor the commitmenttohavelowestcost independent thirdpartywillverifythat establish themeanswherebyan rovide rown InvestmentsCorporationwill KidsFirst services tovulnerable Plus KidsFirst to provide Strategy •C • •C • • with solidbusinessplans specifically targetingyouthentrepreneurs capital from$5millionto$10and amount ofavailablenon-budgetaryloan from $10,000to$15,000,doublingthe the individualloanlimitwillincrease meet theneedsofyoungentrepreneurs; marketing effortsandloanamountsto Association programbytailoring Expand theSmallBusinessLoans University ofCanadaco-opprogram participation intheFirstNations Aboriginal Speakers’Bureauand and ProfessionalInternshipProgram,the youth throughtheAboriginalManagement employment opportunitiesforAboriginal Support skillsdevelopmentand College ensure ongoingaccreditationofthe Saskatchewan’s CollegeofMedicineto Increase fundingtotheUniversityof community agencies the Crowns,educationalinstitutionsand delivered throughpartnershipsbetween sector workforce.Theseinitiativeswillbe Aboriginal participationintheCrown create moreopportunitiesforyouthand $20 millionoverthenextfiveyearsto Crown corporationswillinvest Green Team Saskatchewan, through interested inbuildingagreener rown InvestmentsCorporationand reate newopportunitiesforstudents Saskatchewan’s Budget and Performance Plan Summary | Budget 2004-05 17 Floor, 1855 Victoria Avenue 1855 Victoria Floor, Floor, 2350 Albert Street 2350 Albert Floor, Floor, 2103 11th Avenue 2103 11th Avenue Floor, th th nd Saskatchewan Finance Branch Communications 11 Regina, SK S4P 3V7 (306) 787-2635 www.graa.gov.sk.ca Saskatchewan Health Policy and Planning Branch 3475 Albert Street Regina, SK S4S 6X6 (306) 787-3162 www.health.gov.sk.ca Saskatchewan Highways and Transportation Communications Branch Avenue 1855 Victoria Regina, SK S4P 3V5 (306) 787-4800 www.highways.gov.sk.ca Saskatchewan Industry and Resources Resource and Economic Policy 2 Regina, SK S4P 4A6 1-866-862-6246 www.gov.sk.ca/finance Saskatchewan Government Relations and Aboriginal Affairs 14 Regina, SK S4P 3V7 (306) 787-8277 www.ir.gov.sk.ca ts for Performance Plans Performance ts for Contac Floor, 1920 Broad Street Floor, Floor, 1919 Saskatchewan Drive Floor, th outh and Recreation th oll Free in Saskatchewan: 1-800-567-4224 www.se.gov.sk.ca www.se.gov.sk.ca Regina, SK S4P 3V7 (306) 787-5729 www.cyr.gov.sk.ca Saskatchewan Environment Inquiry Centre Saskatchewan Environment’s (306) 787-2700 T Regina, SK S4P 3V6 (306) 787-3686 www.dcre.gov.sk.ca Saskatchewan Corrections and Public Safety Branch Communications and Public Education 1874 Scarth Street Regina, SK S4P 3V7 (306) 787-7872 www.cps.gov.sk.ca Saskatchewan Culture, Y 4 Saskatchewan Agriculture, Food Saskatchewan Agriculture, and Rural Revitalization Branch Communications Street Room B5, 3085 Albert Regina, SK S4S 0B1 (306) 787-5160 www.agr.gov.sk.ca Saskatchewan Community Resources and Employment Branch Communications and Public Education 12 18 Budget 2004-05 | Budget and Performance Plan Summary 5 Communications Director Saskatchewan NorthernAffairs www.sasked.gov.sk.ca (306) 787-9478 S4P 3V7 Regina, SK 1 Communications Branch Saskatchewan Learning www.labour.gov.sk.ca (306) 787-3637 S4P 3V7 Regina, SK 1870 AlbertStreet Communications Branch Saskatchewan Labour www.saskjustice.gov.sk.ca (306) 787-7872 S4P 3V7 Regina, SK 1874 ScarthStreet Communications andPublicEducationBranch Saskatchewan Justice www.gov.sk.ca/psc (306) 787-7592 S4P 3V7 Regina, SK 2100 BroadStreet Communications Saskatchewan PublicServiceCommission www.northern.gov.sk.ca/index.html (306) 787-5061 S4P 3V7 Regina, SK th st Floor, 2220CollegeAvenue Floor, 1919SaskatchewanDrive www.se.gov.sk.ca T (306) 787-2700 Saskatchewan Environment’s InquiryCentre Safe DrinkingWater Strategy www.sasked.gov.sk.ca/echild (306) 787-5077 S4P 3V7 Regina, SK 2220 CollegeAvenue Early ChildhoodDevelopmentBranch KidsFirst www.swa.ca (306) 787-2892 S4P 2K5 Regina, SK Rm 101–2022CornwallStreet Policy andCommunications Saskatchewan Watershed Authority www.spmc.gov.sk.ca (306) 787-1528 S4P 3V7 Regina, SK 1840 LorneStreet Organizational Development Management Corporation Saskatchewan Property www.slga.gov.sk.ca (306) 787-4214 S4P 3M3 Regina, SK 2500 Victoria Avenue P. and GamingAuthority Saskatchewan Liquor oll FreeinSaskatchewan:1-800-567-4224 O. Box5054 Strategy 2004 –2005 Saskatchewan Provincial Budget

Technical Papers 20 Budget 2004-05 | Budget and Performance Plan Summary 1991-92 to2004-05 HEALTH SPENDING (6.3 percent)in2004-05,to$2.69billion. budget willincreaseby$160.3million surgical anddiagnosticaccess.Thehealth recruitment, andaddresspriorityissueslike support healthproviderretentionand increases tomeetrisinghealthcarecosts, Budget, whichprovidessignificantfunding people. Thatpriorityisreflectedinthis services isatoppriorityforSaskatchewan Maintaining quality, accessiblehealthcare Health Care SpendinginSaskatchewan

Billions of Dollars 0.5 1.0 1.5 2.0 2.5 3.0 0 91-92 92-93 93-94 94-95 95-96 96-97 97-98 provincial programspending. spending nowaccountsfor44percentof 6.6 percentayearsince1999-00–andhealth pace inrecentyears–anaverageof Health costshavebeengrowingatarapid 98-99 99-00 00-01 01-02 02-03 03-04 04-05 Budget and Performance Plan Summary | Budget 2004-05 21 44% Health 5,587 5,229 2,932 2,835 2,784 2,704 2,614 2,554 2,534 2,382 2,378 2,356 2,247 capita SK YT BC NL NS AB NB PEI QU ONT NUN NWT MAN 1 2 3 4 5 6 7 8 9 10 11 12 13 Rank P/T $ per 20% Learning 4 18% All Others 9 12 11 4% 10% 5% & Food 13 Agriculture Highways & & Employment Note: due to rounding 100 per cent exceeds Total Transportation health care is on par with the national is average. Another method of comparison per resident. the amount spent on health care The table below shows that Saskatchewan’s health spending was $2,554 in per-capita average 2003, just slightly above the national of $2,450. Community Resources 39% 10 Health 2 5 8 20% Learning 1 7 18% All Others 3 6 adian Institute for Health Information 11% 7% 5% Source: Can & Food & Employment Agriculture Highways & Transportation 1999-2000 EXPENDITURE BY DEPARTMENT1999-2000 EXPENDITURE BY DEPARTMENT 2004-2005 EXPENDITURE PER-CAPITA HEALTH CARE SPENDING BY PROVINCE AND TERRITORY AND CARE SPENDING BY PROVINCE HEALTH PER-CAPITA Saskatchewan’s experience with rising health experience with rising Saskatchewan’s the costs is not unique. According to Canadian Institute for Health Information health (CIHI), growth in Saskatchewan’s spending is slightly below the national while the average over the past five years, spent on percentage of the provincial budget Community Resources The largest spending increases in the health HEALTH COST DRIVERS budget are for provider salaries, physician Health care costs are growing faster than the fees and benefits, which are growing at a rate of inflation for a variety of reasons, significant rate as Saskatchewan competes including the cost of health care provider with other jurisdictions to retain and recruit compensation, medical advances, the health providers. Health provider salaries, increased use of high-cost surgical and professional fees and benefits account for diagnostic procedures, the spiralling cost of over 70 cents out of every health care dollar in pharmaceuticals, and growing rates of chronic Saskatchewan, making human resource costs disease like diabetes, cardiovascular disease, the number one cost driver in health care. and cancer.

The other major cost driver in the system Health care providers are integral to the is the rising cost and increased use of delivery of quality, accessible health care prescription medications. The Budget also services. Ensuring we have the doctors, provides new funding to improve access to nurses, therapists, pharmacists, mental health cancer care, surgery, diagnostics, and renal workers and other valued providers the dialysis – all priorities identified in the Action system needs is a challenge that transcends Plan for Saskatchewan Health Care. provincial and international borders. Health While addressing the need for new spending care salaries and professional fees have to meet health care priorities, the Government grown significantly in recent years as the will continue to pursue system reforms that province strives to retain and recruit health ensure the most appropriate delivery of providers. The province has also invested in health care services and the most effective bursaries and other incentives to keep and use of health care dollars. The Government attract providers.

will assess how health care dollars are used The largest funding increase in the health to make sure that management and care budget and the Provincial Budget is administration of the health care system is as going to salaries, fees, pensions and benefits lean as it can be. The Province is also urging for nurses, physicians, health science the federal government to increase its share employees, health support workers and of health care funding. medical residents.

2004-05 NEW HEALTH SPENDING

(Millions of Dollars) Salaries, Physician Fees, Benefits, Pensions $ 115.2 Drug Plan and Extended Health Benefits 19.3 Health Authorities and Cancer Agency – Operating and Capital 14.5 (eg: medical and non-medical supplies, drugs, utilities.

| Budget and Performance Plan Summary| Budget and Performance Excludes remuneration) Provincial Programs and Transfers 11.3 (eg: Can. Blood Services, Provincial Lab, out-of-province health services) Budget 2004-05 22 Total $ 160.3 Budget and Performance Plan Summary | Budget 2004-05 23 73% Salaries/ Pensions Physician Fees/ ($1,951,787,000) Medical advances that provide new and diagnostics, therapies, treatments chronic techniques for managing acute and provided disease have extended lives and these However, greater quality of life to many. breakthroughs come with an enormous cost. The cost of introducing new technology can be significant: a new MRI machine costs approximately $2.8 million and the annual operating cost of around $1 million is an even greater cost driver over the long-term. 7% ng Costs include: Canadian Blood Services, Blood Services, Canadian include: ng Costs ($182,099,000) & Operating Costs Provincial Programs Operati 1 # of Beneficiaries # of Prescriptions of Cost Drug Plan Share Increase Cost 8% Provincial Programs and include: Costs and Capital Agency Operating Regional Health Authorities and Cancer ($217,352,000) Health Benefits Provincial Lab, out-of-province-services, Health Quality Council, and health research. Health Quality Council, out-of-province-services, Lab, Provincial and utilities. drugs, supplies, and non-medical medical equipment and facilities, 1 2 12% Drug Plan & Extended Drug Plan & Extended Authorities & ($335,857,000) Regional Health Cancer Agency: 1999 28,644 205,237 $ 4,152,922 2003 52,843 404,625 7,894,536 90% 2 Operating & Costs CHOLESTEROL-LOWERING DRUGS CHOLESTEROL-LOWERING 2004-05 HEALTH CARE BUDGET 2004-05 HEALTH The Saskatchewan Drug Plan provides with low assistance to about 113,000 families costs or a incomes, high prescription drug meeting the combination of both. The cost of costs and annual growth in pharmaceutical adding new therapies to the drug plan is a major challenge. According to CIHI, pharmaceutical costs have outpaced overall growth in health spending every year since 1984. The budget for the Drug Plan will increase by 10.3 per cent in 2004-05, below the five-year growth rate of 15.4 per cent. Every year, a growing number of people are SASKATCHEWAN DRUG PLAN diagnosed with chronic diseases that can AVERAGE COST PER PRESCRIPTION require health care services ranging from $38.00 prescription drug therapy to high-cost 40 medical interventions. From 1997 to 2001, 35 $29.22 the incidence of diabetes in Saskatchewan 30 increased from 29 to 41 cases per thousand 25 residents – an increase of 41 per cent. The 20 Saskatchewan Cancer Agency reports that 15 from 1970 to 2001, the number of people Dollars 10 with invasive cancer increased by an average 5 of three per cent a year and that pattern is expected to continue. 0 1999-00 2003-04 The number of people experiencing kidney failure is growing at a rate of 10 per cent a year. To address the growing demand for HEALTH FUNDING SOURCES home dialysis and hemodialysis, and to Reductions in federal Canada Health and provide the service closer to patients, the Social Transfer (CHST) funding during the Province has expanded the service to six 1990s have resulted in a major shift in the locations, with a seventh in the planning distribution of federal and provincial health stage. The health care costs for maintaining a care funding over the past decade. As the patient on hemodialysis can be as much as federal government withdrew funding, $55,000 a year. Saskatchewan and the other provinces were forced to assume a greater share of health PATIENTS RECEIVING HEMODIALYSIS care costs. Even with the recent funding AND HOME DIALYSIS increases contained in the 2003 First 1998 - 2004 Ministers’ Health Accord, the federal government is providing only 16 per cent of 650 599 national health and social programming costs. 565 547 550 535 479 450 382 350 Number of Patients

250 1998 2000 2001 2002 2003 2004 | Budget and Performance Plan Summary| Budget and Performance Budget 2004-05 24 Budget and Performance Plan Summary | Budget 2004-05 25 07-08 06-07 05-06 Federal Health and Social Transfers 04-05 03-04 Compounding this problem is the manner in Compounding this are paid to the which federal transfers illustrated by the fact that provinces. This is see a reduction in its Saskatchewan will transfers for health and social 2004-05 federal per cent. This decline will programs of 7.3 time that health care occur at the same by 6.3 per cent. spending is increasing 02-03 01-02 00-01 99-00 98-99 97-98 Provincial – Territorial Health and Social Spending 96-97 95-96 94-95 0

80 60 40 20

180 160 140 120 100 Billions of Dollars of Billions FEDERAL SHARE OF PROVINCIAL-TERRITORIAL HEALTH AND SOCIAL SPENDING AND HEALTH FEDERAL PROVINCIAL-TERRITORIAL SHARE OF The federal government recently confirmed its The federal government additional $2 billion in commitment to an in 2003-04. While it health care funding $62 million for provides an additional this one-time that fiscal year, Saskatchewan in address the ongoing funding does not with insufficient federal challenges associated transfers. health and social 26 Budget 2004-05 | Budget and Performance Plan Summary 2003-04 PERCAPITA FISCALCAPACITIES provinces canraiserevenuesrelativetoone The equalizationprogrammeasureshowwell Act, 1982 equalization wasenshrinedinthe introduced in1957,andtheprincipleof Confederation, theprogramwasformally part ofCanada’s fiscalsystemsince While theconceptofequalizationhasbeen those ofwealthierprovinces. lower levelofpublicservicescomparedto to imposehighertaxesand/orprovidea (i.e., abilitytoraiserevenues)wouldbeforced provinces witharelativelylowfiscalcapacity absence ofsomeformequalization, ability ofprovincestoraiserevenues.Inthe In Canada,therearedifferencesintherelative GENERAL Equalization

Per Capita Fiscal Capacity ($) 10,000 2,000 4,000 6,000 8,000 0 as afederalresponsibility. So urce: February 2004federal Finance estimatesfor2003-04 BC AB Per CapitaFiscalCapacity SK Constitution MB ON compared. fiscal capacityandthestandardtowhichitis graph illustrateseachprovince’s percapita bring themuptothestandard.Thefollowing payments fromthefederalgovernmentthat provinces areentitledtoreceiveequalization including Saskatchewan.The“havenot” currently theeightremainingprovinces, are designated“havenot”provinces– lower-than-average revenueraisingcapacity currently AlbertaandOntario.Thosewitha standard) aredesignated“have”provinces– raising capacity(i.e.,thoseabovethe Provinces withanabove-averagerevenue 33 separaterevenuesources. province’s percapitafiscalcapacitybasedon complex formulathatmeasureseach another. Thisisaccomplishedthrougha QC NB Standard NS PEI NF Budget and Performance Plan Summary | Budget 2004-05 27 2003-2004 Ten-Province Standard standard (still in use today) from a standard (still in ten-province standard. oil up to 1982, Alberta’s In the years leading raising the program’s and gas wealth was causing all equalization- standard, thereby to benefit from higher receiving provinces limit the cost of the payments. To to the federal equalization program was government, resource-rich Alberta partially removed from the standard. To four Atlantic compensate for this change, the the provinces were also removed from standard. Given the important role of equalization, have all provinces, including Saskatchewan, to been calling on the federal government to do this strengthen the program. One way standard is by returning to a ten-province that recognizes the volatility of resource revenues. The following graph compares under the the overall level of entitlements they would five-province standard with what standard. have been under a ten-province 2002-2003 Five-Province Standard dard versus a Ten-Province Standard Ten-Province a dard versus 2001-2002

8 6 4 2 0

16 14 12 10 Billions of Dollars of Billions Five-Province Stan NATIONAL EQUALIZATION ENTITLEMENTS EQUALIZATION NATIONAL In 1982, the federal government introduced In 1982, the federal government a significant reform to the equalization program by moving to a five-province STRENGTHENING THE PROGRAM EQUALIZATION VS.TEN-PROVINCEFIVE-PROVINCE STANDARD As implied in the graph, the “have not” As implied in the differing equalization provinces receive on the strength of payments, depending ability to raise revenue their economy and relative to the average (i.e., fiscal capacity) in the standard – of the five provinces Saskatchewan, Manitoba, British Columbia, Ontario and Quebec. has received the Saskatchewan Historically, the receiving lowest per capita equalization of recently provinces. British Columbia has currently become a “have not” province and a receives the lowest entitlement on per capita basis. 28 Budget 2004-05 | Budget and Performance Plan Summary mining profits. approach thatreliesonadeterminationof value ofproduction,toaneconomicrent changed fromacombinationofvolumeand province’s entitlementfromminingwas the measurementusedtodeterminea combined intoonetaxbase.Aspartofthis, four individualminingtaxbaseswere As partofthe1999renewalprogram, PROXY BASES live inlessaffluentprovinces. services providedtoCanadiancitizenswho at stakeisthelevelandqualityofpublic comparable levelsoftaxation.Simplyput, levels ofpublicservicesatreasonably revenues toprovidereasonablycomparable that provincialgovernmentshavesufficient is animportantissue.Itintendedtoensure The adequacyoftheequalizationprogram increased equalizationentitlements. amount toabout$275millionperyearin provinces. ForSaskatchewan,thiswould equalization entitlementsforalllessaffluent of theprovinces,wouldsignificantlyincrease representative oftheaveragefiscalcapacity ten-province standard,whichistruly As showninthegraph,areturnto volume andvalueofproduction. compared totheoldbasesthatreliedon application ofthefederalproxybase,when per yearinminingbaseentitlementsfromthe has lost,onaverage,about$50million the followingtableillustrates,Saskatchewan to bebothvolatileanddifficultpredict.As Since then,furtherdataupdateshaveproven transfers toSaskatchewan. an unexpectedandsignificantdeclinein base formining.Theresultwas of equalizationentitlementsundertheproxy government releaseditsfirstofficialestimate entitlements. InOctober2002,thefederal would benefitthroughhigherminingbase government estimatedthatSaskatchewan In introducingthischange,thefederal actual taxingpracticesoftheprovinces. produces resultsthatdonotreflectthe fiscal capacityfromtheminingsector, it attempts toreflectaprovince’s underlying mining taxbase.Althoughthisapproach represents aproxydeterminationofthe mining profitsearnedineachprovince.This apply aseriesofassumptionstoestimate of Financeuseanumberdatasourcesand Statistics CanadaandthefederalDepartment Budget and Performance Plan Summary | Budget 2004-05 29 om Courchene of Queen’s University, entitled University, om Courchene of Queen’s PROFESSOR COURCHENE’S ANALYSIS PROFESSOR COURCHENE’S Professor The recently published paper by T Case Confiscatory Equalization: The Intriguing Revenues, Energy Vanishing of Saskatchewan’s raises a number of criticisms of the current federal equalization program. In addition to raising concerns about the proxy mining tax base, similar to those noted above, Courchene argues that the federal equalization program tends to claw back, or energy (i.e. oil “tax back”, Saskatchewan’s and natural gas) revenues at an average rate of more than 100 per cent. In other words, he argues that the program has at times left Saskatchewan worse off financially as a result of the development of its energy resources. For example, for fiscal 2000-01, he shows that the average tax-back rate for all energy bases was 108.4 per cent. Courchene singles provincial fiscal capacities. This approach provincial fiscal capacities. This would avoid the unpredictable and questionable results caused by applying with proxies, as has been demonstrated the mining tax base. 207,626) $ (186,699) $ (172,668) $ (199,079) $ (142,982) 1999-00 2000-01 2001-02 2002-03 2003-04 $( ld” Bases – Mining

.“O os – – – – – ds of Dollars) des the impact of the phase-in of the proxy mining tax base. al (8,937) (8,888) (10,566) (12,562) (9,309) tash (112,336) (130,962) (119,700) (116,207) (110,826) her Minerals (4,576) (3,494) (4,940) (6,604) (4,780) Ot Po Asbest Co tal Entitlement (125,849) (143,344) (135,206) (135,373) (124,915) date, the federal government has refused Old Bases – Mining To Decline in Entitlements**Exclu $ (81,777) $ (43,355) $ (37,462) $ (63,706) $ (18,067) (Thousan Proxy Base

SASKATCHEWAN’S EQUALIZATION ENTITLEMENTS BASES – MINING EQUALIZATION SASKATCHEWAN’S Proxy Base vs The surprising results of October 2002 and The surprising results of October estimates the volatility of subsequent federal mining tax reflect the deficiency of the proxy any, base. In addition, there is little, if base correlation between the federal proxy actually and the level of mining royalties collected by the provinces. renewal During the current equalization requested discussions, Saskatchewan formally the that the federal government withdraw the four proxy mining base and return to prior separate bases for mining that existed to the 1999 renewal. This change would provide a more predictable and accurate measure of relative fiscal capacities among provinces in the mining sector. To this request. In response to Saskatchewan’s concerns, it has chosen to introduce minor changes that attempt to fix some of the more obvious deficiencies of relying on the proxy base for determining mining entitlements. This situation typifies the risk of determining equalization tax bases using proxies. Saskatchewan supports the use of actual provincial taxing practices instead of proxy measures wherever possible to measure 30 Budget 2004-05 | Budget and Performance Plan Summary 2000-01 TAX-BACK RATES ONSASKATCHEWAN’S REVENUES ENERGY proposal wouldbetolimitthetax-backrate Courchene feelsthatthemoststraightforward In termsofpossibleremediestothisproblem, transferred totheotherprovinces. energy revenuesaremorethanfully rates exceed100percent,Saskatchewan’s provinces. Inotherwords,whentax-back equalization entitlementsofotherrecipient for Saskatchewan,butalsoincreasesthe not onlyyieldsincorrectlyhightax-backrates Second, anover-inflated basemeasurement measurement andisindefensibleonitsown. 100 percentindicatesaflawedbase two ways.First,atax-backrateinexcessof equalization structurebecomesapparentin confiscatory aspectofthecurrent More generally, Courchenearguesthatthe tax-back rates. as illustratedinCourchene’s analysisof bottom ofthepagereproducesthesenumbers 235.9 percentin2000-01.Thetableatthe offensive withatax-backrateof is calculatedbyproxy, asbeingparticularly out the“SalesofCrownLeases”base,which To Ot (Thousan xotdNtrlGs01,6 – (33.0%) (93.1%) (235.9%) 19,065 (99.7%) (23,732) (145,011) (219,799) 0 (403,495) 61,483 236,117 71,881 $ 404,884 $ Sales ofCrown Leases NaturalGas Exported Do Heavy Oil Old Oil New Oil a ,3,5 11599 (108.4%) (1,125,959) $ 1,038,353 $ tal e i n a 463(513 (101.8%) (25,123) 24,683 her OilandGas etcNtrlGs2935(2,6)(137.0%) (327,864) 239,305 mestic NaturalGas ds ofDollars) to thefederalgovernment. and thuslimittheoverallcostofchange limit theupwardskewingeffectofAlberta, 25 percentinclusionofresourcerevenuesto suggests thatthiscouldbecombinedwitha to theten-provincestandard.Hefurther calculation, Courcheneadvocatesareturn problems withthecurrentequalization In termsoflonger-term solutionstothe the equalizationprogram. of Saskatchewan’s miningrevenuesunder This changewouldimprovethetreatment closely reflectactualrevenuesgenerated. and replacethemwithbasesthatmore “artificial” orproxybasesthatcurrentlyexist, Courchene, wouldbetoeliminatethe current inequitiesintheprogram,argues An additionalshort-terminitiativetoaddress Newfoundland. precedent inplaceforNovaScotiaand maximum of70percent,similartothe on allSaskatchewan’s energyresourcestoa eeusEtteetTax-Back Rate Entitlement Revenues nryEulzto Average Equalization Energy Budget and Performance Plan Summary | Budget 2004-05 31 Reform of the equalization program’s Reform of the equalization must be made treatment of resources not be put off until the now and should next renewal. A delay completion of the to face high would force Saskatchewan at least another five years. tax-back rates for to Saskatchewan and This is unacceptable are required to face higher its residents who compensate for receiving taxation levels to little or no financial gain from the development of their non-renewable resources. the Saskatchewan also continues to question changing resistance to federal government’s and the mining tax base. The unpredictable of applying often contradictory consequences the mining a proxy calculation to determine tax base should convince the federal changes, government that minor technical the federal such as those proposed as part of 2004 renewal, are inadequate. of the Saskatchewan believes that, as part a return to current renewal, there should be the previous mining bases that generally mining relied on the value and volume of output. This would significantly improve the predictability and reliability of measuring a mining tax base, and reverse the province’s negative financial consequences for Saskatchewan that have resulted from the proxy base. NEXT STEPS to pursue fair and Saskatchewan continues for its resources under equitable treatment program. The federal the federal equalization agreed that tax-back rates government has cent are not an acceptable exceeding 100 per be addressed. result and should concerns raised, the In response to the to federal Finance Minister has agreed provide Saskatchewan with a retroactive million to compensation payment of $120 help resolve the equalization program’s applied unacceptably high tax-back rates Crown lease revenues. to Saskatchewan’s is an Saskatchewan believes that this important first step by the federal of the government toward the recognition treatment concerns respecting the Province’s of resource revenues under the federal equalization program. Saskatchewan will continue to examine treatment of other energy equalization’s resource revenues to ensure that are brought unacceptably high tax-back rates to the attention of the federal government for corrective action. The next step for the federal government would be to adopt Professor Courchene’s recommendation of applying the generic 70 per cent solution to all oil and gas revenues, as it is currently applied in Nova Scotia and Newfoundland. It is unfair that one region of Canada is accorded special treatment while other provinces experience tax-back rates approaching and sometimes exceeding 100 per cent. 32 Budget 2004-05 | Budget and Performance Plan Summary CANADIAN ECONOMIC OUTLOOK province’s GrossDomesticProduct(GDP). represent approximatelytwo-thirdsofthe development becauseexportreceipts be strongerin2004.Thisisapositive the province’s majortradingpartners,will Economic growthacrosstheglobe,including PARTNERSMAJOR TRADING ECONOMIC OFSASKATCHEWAN’S PROSPECTS other elementsintheprovincialeconomy. production, income,investmentandmany with theweatherinprovince,determine These externaleconomicconditions,along markets, affecttheprovincialeconomy. Saskatchewan producersselltothese prices forthevariousproductsthat and therestofCanada,aswellglobal export marketsliketheUnitedStates,Asia Economic conditionsintheprovince’s main economy. critically importanttotheSaskatchewan The externaleconomicenvironmentis INTRODUCTION Saskatchewan’s EconomicOutlook *Act Can aainS neetRt % . . . 3.4 2.5 2.3 2.9 Can (%) Rate Interest ST Canadian Can Can da TItrs ae()6563656.8 6.5 2.8 3.1 6.3 2.8 6.5 1.7 adian LT Interest (%) Rate adian RealGDP(%Change) da olr(Scns 207. 0281.0 80.2 78.4 72.0 (UScents) adian Dollar da P %Cag)2809081.2 0.8 0.9 2.8 adian CPI(%Change) ual 03 0420 2006 2005 2004 2003* • • • in 2004and2005. partners inAsia,isexpectedtocontinue and Japan,Saskatchewan’s maintrading Economic growthinChina,SouthKorea 4.3 percentin2005. accelerate to4.9percentin2004and stimulus, U.S.growthisexpectedto Assisted byforcefulmonetaryandfiscal U.S. dollar. value oftheCanadiandollarvis-à-vis fires inB.C.andtherapidincrease beef andsoftwoodlumberexports,forest the poweroutageinOntario,restrictionson growth ratelastyearwashamperedbySARS, important totheprovince.Canada’s economic Canadian economicconditionsarealso C ANADIAN ECONOMIC OUTLOOK the modestgrowthregisteredin2003. Japan’s economyisexpectedtocontinue the periodisprojectedtoimprove. South Korea’s economicgrowthduring and nextyear. year isexpectedtoberepeatedthis China’s 8.0percent-plusadvancelast Budget and Performance Plan Summary | Budget 2004-05 33 OUTLOOK FOR KEY COMMODITIES OUTLOOK gas prices remained Crude oil and natural in 2003. Wheat prices edged relatively strong canola and but prices for barley, up slightly, decreased. other major crops CRUDE OIL Texas The price of a barrel of West Intermediate (WTI) oil averaged US$30.99 high in 2003. The WTI oil price remained throughout 2003 because of geopolitical global tensions, tight supplies and stronger second demand for oil, particularly in the half of last year. will It is assumed that the WTI oil price 2004, decline to US$26.50 per barrel in in 2006. US$25.00 in 2005 and US$25.43 the The number of oil wells drilled in 2002 to province increased from 1,643 in but is expected to decrease 1,875 last year, wells along with the price of oil to 1,600 this year and 1,500 wells in 2005. barrels Saskatchewan produced 151.6 million down 1.3 per cent from the of oil last year, 2002 production level of 153.6 million barrels. Oil production is expected to increase slightly to 152.2 million barrels in 2004 and 152.7 million barrels in 2005. 2003 2004 2005 2006 basis

il (US$/barrel) 30.99 26.50 25.00 25.43 nola (C$/tonne)* 320.00 340.00 266.60 266.58 tash (C$/tonne) 184.18 188.28 185.88 187.17 *Crop year *Crop Ca WTI O WTI Natural Gas (C$/GJ)Po Wheat (C$/tonne)*Barley (C$/tonne)* 5.93 147.00 110.00 4.70 150.00 105.00 4.25 154.79 102.64 153.88 4.00 104.18 MMODITY PRICE FORECASTS CO A modest improvement in Canada’s economic in Canada’s A modest improvement in 2004 and 2005. growth rate is expected to grow at an real GDP is projected Canada’s per cent in 2004 and annual rate of 2.8 far better than the 3.1 per cent in 2005, growth posted in 2003. meagre 1.7 per cent is projected to The Canadian dollar of average level year’s increase from last in 2004 72.0 U.S. cents to 78.4 U.S. cents projected and 80.2 U.S. cents in 2005. The dollar increase in the value of the Canadian weakness reflects, in large part, the perceived in the U.S. dollar arising from sizeable deficits. U.S. budget and current account rates The Bank of Canada has cut interest to bolster twice thus far in 2004, in an attempt the negative domestic demand and counteract dollar on impact of the stronger Canadian the economy. Short-term interest rates are, therefore, of projected to decrease from an average in 2004, 2.9 per cent in 2003 to 2.3 per cent in 2005. but increase slightly to 2.5 per cent Long-term interest rates are projected to decrease from 6.5 per cent in 2003 to 6.3 per cent in 2004, but rise back to 6.5 per cent in 2005. 34 Budget 2004-05 | Budget and Performance Plan Summary SASKATCHEWAN PRODUCTION CROP $184.18 pertonnefrom$210.83in2002, 12.6 percentin2003,droppingto Potash minenetbacksdecreasedby POTASH start todeclinein2006duelowerdrilling. and 297.7billioncubicfeetin2005.Sales to increase291.9billioncubicfeetin2004 than in2002.Salesvolumesareforecasted natural gasin2003,about6.3percentmore The industrysold257.9billioncubicfeetof in 2006. this year, 1,100wellsin2005and900 drilling isexpectedtodecrease1,500wells As isthecasewithoildrilling,naturalgas than thenumberofwellsdrilledin2002. Saskatchewan lastyear, 23.6percentmore The industrydrilledarecord2,314wellsin current andexpectedsupplydemand. $4.00 in2006.Thesepricesarebasedon $4.70 perGJin2004,$4.252005and decrease from$5.93perGJin2003to The priceofnaturalgasisprojectedto NATURAL GAS

Millions of Tonnes 10 15 20 25 30 0 5 1978 1981 1984 Crop Production 1987 culForecast Actual 1990 1993 forecast period. projected tocontinueincreaseoverthe was establishedin1997.Potashsalesare previous salesrecordof8.7milliontonnes 7.8 percentfrom2002.Theindustry’s year reached8.8milliontonnes,up new recordinsaleslastyear. Total saleslast Saskatchewan’s potashindustryestablished a $187.17 pertonnein2006. 2004, $185.88pertonnein2005and slightly higherto$188.28pertonnein demand willpushaveragepotashprices and higheroceanfreightrates.Stronger due totheappreciationofCanadiandollar internationally. the expectedincreaseinharvest significantly overtheforecastperioddueto Wheat pricesarenotexpectedtoimprove year from$145.00inthe2002-03cropyear. up slightlyto$147.00inthe2003-04crop The averagepriceforatonneofwheatedged GRAINS 1996 10-year average 1999 2002 2005 2008 Budget and Performance Plan Summary | Budget 2004-05 35 The province emerged from a two-year, The province emerged expanding slump last year, drought-induced of 3.9 per cent. The at an annual rate growth rate is forecasted economic province’s cent in 2004, 1.7 per cent to slow to 2.6 per per cent in 2006, as a result in 2005 and 1.7 and lower commodity of the stronger dollar prices. slightly Private sector forecasters remain more optimistic about Saskatchewan’s projecting economic performance in 2003, The an average growth of 4.3 per cent. of projections range between a low high of 3.5 per cent by Scotia Bank and a of 5.4 per cent by the Conference Board Canada. are On average, private sector forecasters and currently looking at 3.2 per cent 2.7 per cent growth for the Saskatchewan economy in 2004 and 2005, respectively. range from For 2004, real GDP growth rates and the a low of 2.8 per cent by Scotia Bank per cent Bank of Montreal to a high of 4.0 by Royal Bank. 2003 2004 2005 2006 l ve 2002 Le ual nsumer Price Indexnsumer Price 1.237(1992=1.0) 2.3* 1.8 1.5 1.6 rsonal Incomersonal Disposable Income $ 18.9B $ 23.9B 5.1 4.8 1.0 1.4 4.6 4.2 2.7 2.8 Retail Trade*Act $ 9.0B 3.6* 3.5 3.3 3.1 Real GDPNominal GDPCo (000s) Growth Employment Rate (%)Unemployment Pe Pe 482.0 $ $ 34.6B 30.4B 5.7 4.8* 2.7 3.9 5.6* 3.8 0.1 2.6 5.7 5.1 2.0 1.7 5.6 5.2 3.1 1.7 5.4 A QUICK LOOK AT SASKATCHEWAN’S ECONOMY SASKATCHEWAN’S AT A QUICK LOOK Change Unless Noted Otherwise) Cent (Per ECONOMIC OUTLOOK FOR SASKATCHEWAN OUTLOOK ECONOMIC North Improved economic conditions in export America, Asia and other Saskatchewan lower markets, a stronger Canadian dollar, return to commodity prices and an assumed province’s an average crop harvest shape the term. economic performance in the near Prices for barley, canola and all other major Prices for barley, for barley The price last year. crops decreased to fall while the price is expected to continue to improve slightly for canola is projected again next year. this year and fall of total crop harvest Saskatchewan’s in 2003 was 45.9 per cent 21.8 million tonnes 8.9 per cent but year, more than the previous smaller than the 10-year average. crop harvest is expected to reach This year’s yields 25.3 million tonnes, based on trend more than and seeded acres, 15.8 per cent is expected The harvest the harvest last year. the to remain at or near this level for remainder of the forecast period. 36 Budget 2004-05 | Budget and Performance Plan Summary dollar andlowercommodityprices. economy adjuststothestrongerCanadian slower thantheprevioustwoyearsas Overall jobgrowthisforecastat3,800, full percentagepoint. only fractionallyandsomebymorethana for 2005,allseegrowthmoderating,some Of theforecastersthatprovideprojections (% Real GDPGrowth) FORECAST COMPARISON SASKATCHEWAN REALGDPFORECAST

IC4632N/A 2.9 1.7 2.8 3.0 2.7 3.2 2.8 2.6 2.1 4.0 3.0 2.8 4.6 3.5 3.9 3.5 4.2 3.6 5.0 3.8 Finance Saskatchewan Sector Private Scotia Bank CIBC Bank ofMontreal Royal Bank TD Bank Confer Global Insight Billions of 1997 Dollars neBad54312.7 3.1 5.4 ence Board 20 25 30 35 40 0 1992 vrg 4 Average Saskatchewan Finance 1994 culForecast Actual 1996 1998 2000 in 2005. call for5,800netnewjobsin2004and4,600 of theforecastperiod.Privateforecasters to the5,000rangeorbetterforremainder The forecastedgrowthinnewjobsimproves Private Sector 0320 2005 2004 2003 2002 3322.7 3.2 .3 2004 2006 Trendline 2008 Budget and Performance Plan Summary | Budget 2004-05 37 2005 2004 2003 Private Sector 2002 2001 2000 There is a possibility that the Canadian dollar There is a possibility that the Canadian rising could slide if U.S. interest rates start spreads and or Canadian/U.S. interest rate stronger U.S. A narrow down substantially. value of the economy combined with a lower and add Canadian dollar would boost exports to economic growth and jobs. crude oil Commodity prices, particularly for than and natural gas, could be higher assumed, and provide more growth and jobs. As well, the province could have a bumper harvest, boosting growth in any of the forecast years. 1999 1998 1997 Actual Forecast 1996 Saskatchewan Finance 1995 1994 1993 1992

510 500 490 480 470 460 450 440 430 420 Thousands of Jobs of Thousands NCLUSION, AND OPPORTUNITIES RISKS CO This forecast is based on reasonable expectations about external economic conditions that affect Saskatchewan’s international commodity including economy, dollar, prices, the value of the Canadian in the interest rates and crop conditions province. per cent in real GDP grew 3.9 Saskatchewan’s 2003, the best pace since 1997. The outlook for 2004 and beyond is for more moderate growth consistent with declining commodity prices and a higher Canadian dollar. are volatile Events around the world, however, and often prove unpredictable. The difficulty is that events do not occur in isolation and frequently have offsetting effects. SASKATCHEWAN EMPLOYMENT FORECAST EMPLOYMENT SASKATCHEWAN 38 Budget 2004-05 | Budget and Performance Plan Summary • is composedof: $5.26 billionor79.9per centoftotalrevenue, Own-source revenue,whichrepresents $6.59 billionin2004-05. To GRF REVENUE to 2007-08. and plansforbalancedGRFbudgetsthrough consecutive balancedbudgetonaGRFbasis The 2004-05Budgetrepresentsthe11 • • • Budget representsthethirdsuchplan. budget followingageneralelection.This Revenue Fund(GRF)tobetabledwiththefirst four-year cumulativebalanceintheGeneral The BalancedBudgetAct Saskatchewan’s GRFFinancial Outlook tal GRFrevenueisexpectedtobe 2004-05 Revenue Initiatives initiatives which aredetailedinthe revenue and includestaxrevenue $3,543.9 millionor53.8 per centoftotal tax revenue,whichaccounts for years. and acumulativebalanceoverthefour GRF balancesineveryyearoftheperiod period 2004-05to2007-08,projectsboth This four-year plan,whichcoversthe achieved. surplus of$59.7millionisexpectedtobe 2000-01 to2003-04–acumulativeGRF During thesecondfour-year period, sale ofCamecoCorporationshares. Investments Corporationrelatedtothe special dividendfromtheCrown and includedaone-time$365.7million surplus of$553.5millionwasachieved 1996-97 to1999-00–acumulativeGRF During thefirstfour-year period, requires aplanfor paper; th CO •t • • • • of totalrevenue,arecomposedof: which represent$1.32billionor20.1percent T • ransfers fromtheGovernmentofCanada, 53.8% Taxes MPOSITION OF2004-05GRFREVENUE 10.7 percentoftotalrevenue; which accountsfor$707.4millionor non-renewable resourcerevenue, revenue. $157.8 millionor2.4percentoftotal other federaltransfers,whichaccountfor equalization compensationpayment;and, revenue, includinga$120million $442.5 millionor6.7percentoftotal equalization payments,whichaccountfor 11.0 percentoftotalrevenue; which accountfor$725.4millionor transfers forhealthandsocialservices, revenue. for $349.4millionor5.3percentoftotal other own-sourcerevenue,whichaccounts 10.1 percentoftotalrevenue;and, which accountfor$664.1millionor ransfers fromCrownEntities, Non-Renewable Resources 10.7% Government of Canada Transfers fromthe Transfers from Crown Entities Other Revenue 20.1% 10.1% 5.3% Budget and Performance Plan Summary | Budget 2004-05 39 Federal Transfers 2007-08 Other Own-Source 2006-07 Other own-source revenue is expected Other own-source annual rate of to climb at an average $365.8 million 1.5 per cent, reaching by 2007-08. GRF OPERATING EXPENSE GRF OPERATING spending Prior to 2004-05, GRF operating basis. In was measured on an expenditure capital 2004-05, with the introduction of will amortization, GRF operating spending be expense based. to be GRF operating expense is expected $6.13 billion in 2004-05. • are expected to increase Federal transfers rate of 7.1 per cent, at an average annual by 2007-08. reaching $1.63 billion Crown Transfers 2005-06 Resources Taxes 2004-05 0 8,000 7,000 6,000 5,000 4,000 3,000 2,000 1,000

ransfers from Crown Entities are ax revenue is expected to grow at an ax revenue is expected Millions of Dollars of Millions Non-renewable resource revenue is Non-renewable resource revenue expected to decline at an average annual rate of 5.3 per cent, reaching $601.1 million in 2007-08. and expected to decrease in 2005-06 increase in 2006-07 and 2007-08, of declining at an average annual rate 2007-08. 0.5 per cent to $654.5 million in average annual rate of 3.0 per cent, reaching $3,869.7 million by 2007-08. 2004-05 to 2007-08 GRF REVENUE SOURCE BY • •T GRF revenue is forecast to increase over GRF revenue is forecast annual period at an average the four-year reaching $7.12 billion rate of 2.6 per cent, in 2007-08. is expected to grow at an Own-source revenue of 1.4 per cent, reaching average annual rate 2007-08. $5.49 billion by •T 40 Budget 2004-05 | Budget and Performance Plan Summary R TOTAL SPENDING GRF • • • • Operating expensewillbeallocatedasfollows: CO Health 43.8% MPOSITION OF2004-05GRFOPERATING EXPENSE

Millions of Dollars operating spending; $264.3 millionor4.3percentof Agriculture, FoodandRuralRevitalization, operating spending; $602.8 millionor9.8percentof Community ResourcesandEmployment, 17.9 percentofoperatingspending; Learning, $1,097.1millionor of operatingspending; Health, $2,687.4millionor43.8percent 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 0 2004-05 Other Departments 20.1% Learning 17.9% Operating Expense Highways Agriculture Resources and 2005-06 4.1% Employment Community 4.3% 9.8% •R • reaching $6.43billionin2007-08. at anaverageannualrateof1.6percent, GRF operatingexpenseisforecasttogrow 2007-08, mainlyduetohigherdebtlevels. rate of1.8percenttoreach$647.0millionby anticipated toincreaseatanaverageannual $614.0 millionin2004-05.Interestcostsare Interest costsareexpectedtobe GRF INTERESTCOSTS by 2007-08. of 1.6percenttoreach$7.08billion and toincreaseatanaverageannualrate is projectedtobe$6.75billionin2004-05 expense andinterestcosts.Total spending To GRF TOTAL SPENDING tal spendingiscomposedofoperating operating spending;and, $252.3 millionor4.1percentof Highways andTransportation, operating spending. $1,230.6 millionor20.1percentof 2006-07 emaining departmentsandagencies, Interest Costs 2007-08 Budget and Performance Plan Summary | Budget 2004-05 41 2007-08 paper. 2006-07 2005-06 initially allocated to revenue over a three-year initially allocated in 2003-04, as reported by period, beginning the additional Now, the federal government. for 2004-05 and 2005- $79.3 million reported into 2003-04 GRF revenue 06 will be brought allocated to the two FSF, and, through the years. transfers will exhaust the It is expected that FSF by the end of 2005-06. in the Further information is provided Fiscal Stabilization Fund 2004-05 2003-04 2002-03 2001-02 2000-01 0

800 700 600 500 400 300 200 100 Millions of Dollars of Millions FISCAL STABILIZATION FUND BALANCES FISCAL STABILIZATION FISCAL STABILIZATION FUND TRANSFER FISCAL STABILIZATION Fund (FSF) was created The Fiscal Stabilization the fiscal position in 2000-01 to stabilize year to year and to of the Province from of long-term facilitate the accomplishment objectives. the FSF had a balance At the end of 2002-03, It is expected that of $577.0 million. deliver $275.4 million will be required to the a balanced budget in 2003-04 and to remaining balance will be allocated 2004-05 and 2005-06. deposit of In 2003-04, the GRF will record a supplement $79.3 million related to the CHST fund and the diagnostic/medical equipment resulting from the 2003 First Ministers’ were Accord on Health Renewal. The amounts 42 Budget 2004-05 | Budget and Performance Plan Summary GRF FINANCIALOUTLOOK remain insurplus2006-07and2007-08. by theendof2005-06,GRFisexpectedto Although theFSFisexpectedtobedepleted GRF BUDGETBALANCES S rnfr181135000.0 41.7 $ 0.1 0.0 $ 688.7 0.1 143.5 7,121.6 6,432.9 $ $ 627.1 0.1 6,920.0 158.1 $ 6,292.9 474.6 $ 6,678.0 $ 6,203.4 456.0 Cumul 6,590.5 $ Budget Balance 6,134.5 FSF Transfer Pr Se Operating Surplus Operating Expense Revenue ofDollars) (Millions -S aac 180 134 . 41.7 0.1 (143.4) (158.0) e-FSF Balance rv cn oenetDb 1. 1. 2. 647.0 627.0 618.0 614.0 icing Government Debt tv aac . . . 42.0 $ 0.3 $ 0.2 $ 0.1 $ ative Balance 040 050 060 2007-08 2006-07 2005-06 2004-05 Budget and Performance Plan Summary | Budget 2004-05 43 ENHANCING TAX CREDITS ENHANCING TAX Credit was The Post-Secondary Graduate Tax introduced in 2000 as a $350 incentive to encourage post-secondary graduates to remain in Saskatchewan. This tax credit is equivalent to an income exemption of almost $3,200 for most new graduates. The tax credit amount is being increased to $1,000 over four years. The following table shows the phased increases to the tax credit amounts and their approximate provincial tax exemption values. INDEXATION OF THE INCOME TAX SYSTEM TAX THE INCOME OF INDEXATION personal income Elements of Saskatchewan’s been automatically indexed tax system have 2000. to the national rate of inflation since credits family tax In 2004, Saskatchewan’s indexed and income tax brackets were also to inflation. the year, Beginning with the 2005 taxation will no indexation factor income tax system’s longer automatically match the national factor inflation rate. Instead, the indexation will be announced each fall. a fair This measure is intended to ensure balance between providing inflation protection for taxpayers, and responding fiscal pressures. to the Government’s $2,441 2004 2004-05 Revenue Initiatives Revenue 2004-05 $2,510 2003 $2,686 2002 $2,878 2001 $3,192 2000 $3,540 1999 RSONAL INCOME TAX RSONAL INCOME o-Income Family of Four Earning $50,000 Earning of Four Family o-Income $4,000 $3,500 $3,000 $2,500 $2,000 $1,500 REDUCING SASKATCHEWAN INCOME TAXES INCOME REDUCING SASKATCHEWAN Tw PE major In 2000, the Government began a This reform of the personal tax system. personal reform improved the fairness of income taxes and simplified the personal its full implementation tax structure. With tax reform has reduced personal last year, by the income taxes of an average family almost $1,100 compared to 1999. The 2004-05 Budget introduces a number of The 2004-05 Budget to address the fiscal revenue initiatives rising pressures facing the Province, including health care expenditures. INTRODUCTION 44 Budget 2004-05 | Budget and Performance Plan Summary • • • tax creditstructureisasfollows: to thesimilarfederaltaxcredit.Therevised January 1,2004,itwillmatchrecentchanges political partiesisbeingenhanced.Effective donations toregisteredSaskatchewan The PoliticalContributionsTax Creditfor oil andgasactivityaresubject tothistax. corporations involvedinthesametypeof on theiroilandgasproduction.Meanwhile, Corporation CapitalTax (CCT)Surcharge are generallyabletoavoidSaskatchewan’s Due totheiruniquelegalstructure,trusts TAXATI TAXATIONRESOURCE ISSUES for annualdonationsexceeding$1,275. The maximumprovincialtaxcreditis$650 T xto a rdtExemption Tax Credit axation 06$80$7,727 $ 6,136 $ 4,545 $ 3,182 $ 850 $ 675 $ 500 $ 350 $ 2006 2005 2004 2003 07$100$9,091 $ 1,000 $ 2007 Y a mutValue Amount ear Post-Secondary GraduateTax Credit and, 50 percentofthenext$350contributed; 75 percentofthefirst$400contributed; 33 1⁄3 ON OF RESOURCE ON OFRESOURCE TRUSTS per centofthenext$525contributed. Phased Increasestothe and fairtaxationenvironment. the interestofmaintainingacompetitive sector representativesonthisissuein Government willbeconsultingwithresource Saskatchewan resourcecompanies.The of thefederaltaxationchangeson committed toexaminingtheimplications The GovernmentofSaskatchewanis 28 percentto21by2007. resource companiesisbeingreducedfrom the federalCorporationIncomeTax rateon Resource Allowancededuction.Inaddition, royalty deductibilityandphaseoutthe a five-yearscheduletophaseinfullresource of theresourcesector. Thechangesincluded a numberofchangestotheincometaxation In 2003,thefederalgovernmentintroduced ROYALTY TAXRE course ofactiontoaddressthissituation. and gasindustryasameanstodetermine The Governmentwillconsultwiththeoil increasing CCTrevenueleakageproblem. in Saskatchewan,andhasalsoledtoan playing fieldintheoilandgasindustry This situationhascreatedanuneven BATE PROGRAM Budget and Performance Plan Summary | Budget 2004-05 45 CCO TAX ax rate of 15 cents per litre will apply to ffective April 7, 2004, the general Fuel ffective January 1, 2004, the Fuel Tax T 20 per cent of gasoline purchases at bulk fuel outlets – the other 80 per cent of these purchases will remain tax exempt. Rebate Program for gasoline and propane purchases at retail outlets is eliminated; and, These changes also apply to commercial fishers, trappers and loggers. The current exemption for diesel fuel is unchanged. For further information, please contact Saskatchewan Finance at 1-800-667-6102. •e FUEL TAX will spend The Government of Saskatchewan almost $300 million in 2004-05 on maintaining and improving Saskatchewan’s roads and highways. purchased In recognition that some gasoline in travel tax exempt by farmers is consumed Government on these roads and highways, the to the is introducing the following changes exemption for farm-use current Fuel Tax gasoline: •e TOBA Budget night, the tax rate Effective midnight cents per on cigarettes is increased from 16 to cigarette or gram of cut/loose tobacco of cut/loose 17.5 cents per cigarette or gram tobacco. The Budget maintains the current PST The Budget maintains heating fuels, exemptions, including clothing, children’s residential electricity, reading materials and prescription drugs, restaurant meals. Full-Year Impact on Families of PST Full-Year the spousal/equivalent component will the spousal/equivalent component be increased from $80 to $100; the child component will be increased from $57 to $75 per child, to a maximum of $150 per family; and, the income supplement and benefit from clawback rates will be increased 1.0 per cent to 1.5 per cent. the maximum basic adult component the maximum basic adult component will be increased from $80 to $100; ensure that the PST rate increase is applied ensure that the PST Rate Increase and SSTC Enhancement

Level Increase Enhancement Increase Income PST SSTC Net Tax • • • full-year The following chart illustrates the impact of the PST rate increase and the offsetting impact of the SSTC enhancements. fairly, its impact on lower-income residents its impact on lower-income fairly, by enhancements to the will be mitigated (SSTC). This Credit Tax Saskatchewan Sales as part tax credit was introduced in 2000 of personal tax reform. be Effective July 1, 2004, the SSTC will enhanced as follows: • $75,000 $ 180 $ – $ 180 PROVINCIAL SALES TAX PROVINCIAL Budget night, the Effective midnight increased (PST) rate is Tax Provincial Sales to 7 per cent. from 6 per cent To $15,000 $$25,000 $$35,000 62 $$50,000 80 104 $ $ (105) 134 $ $ (55) $ $ (5) (43) $ – $ 25 99 $ 134 46 Budget 2004-05 | Budget and Performance Plan Summary simplified tax structureapplieddirectly to surtaxes and alowincomereduction toa tax shiftedfromacomplex systemoftaxes, In 2001,Saskatchewan’s personal income system. become fundamentalelements ofthetax objectives, sometaxexpenditureshave of economicactivity. Inpursuingthese of thetaxsystemorpromotingcertaintypes objectives, suchasenhancingthefairness T THE RATIONALE FORTAX EXPENDITURES as directexpenditures. government's fiscalpositioninthesameway generated byagovernmentandtheyaffect programs, theyreducetheamountofrevenue presented inthesamewayasdirectspending in theoverallrevenueestimatesandarenot While taxexpendituresareusuallyabsorbed senior citizensandsmallbusinesses. businesses, includingfamilies,farmers, assistance toavarietyofindividualsand activity. Taken together, theyprovide to certaintaxpayersortypesof provides specialorpreferentialtreatment preferential taxratesordeferrals.Each as exemptions,deductions,taxcredits, expenditures" andincludesuchmeasures These reductionsarecommonlycalled"tax reducing thetaxespaidbycertaintaxpayers. some oftheirsocialandeconomicgoalsby to raiserevenue,governmentsalsoattain Although theprimarypurposeoftaxationis INTRODUCTION Saskatchewan’s TaxExpenditures ax expenditurescanachieveanumberof To refundable taxcredits. impacts ofseveraltheprovincialnon- paper alsoprovidesestimatesoftherevenue increased to$2,583perchildfor2004.This and adependentchildamount,whichhas increased to$1,033forthe2004taxyear, supplement totheageamount,whichhas provincial taxsystemintroduceda the 2004taxyear. Inaddition,thenew basic andspousalamountsare$8,264for counterparts. Asaresultofindexation,the amounts thatarehigherthantheirfederal Saskatchewan implementedbasicandspousal parallel federalcredits,exceptthat credits. Provincialtaxcreditsgenerally increases inprovincialnon-refundabletax structure ontaxableincomealongwith by introducingaprogressivethree-ratetax the fairnessofitspersonalincometaxsystem The GovernmentofSaskatchewanimproved deductions areestimatedinthispaper. revenue. Theimpactsofseveralthese continue toaffectSaskatchewanincometax Retirement SavingsPlancontributions, such asthedeductionforRegistered the federaldeterminationoftaxableincome, tax purposes.Deductionsthatcontributeto taxable incomeasdefinedforfederal Saskatchewan's capitaltaxensuresthat only of 17percent. Theexemptionfrom than thegeneralcorporate incometaxrate corporate incometaxrate issignificantlyless larger corporations.The small business rate onsmallbusinesses andacapitaltaxon taxes, Saskatchewanleviesalowerincometax

improve thedistributionofcorporate Budget and Performance Plan Summary | Budget 2004-05 47 ax expenditures result in the reduction ax expenditures EXPENDITURES First, there is the cost of forgone revenue. First, there is the T and have a of revenue collected on a government's significant impact financial position. may add to the Second, tax expenditures tax system, leading to complexity of the effort by both increased administrative taxpayers and governments. Third, tax expenditures may create distortions in consumer and other For example, the economic behaviour. snack exemption for restaurant meals and for foods provides preferential treatment this category of consumer expenditure. may create tax expenditures Finally, increased compliance costs for both businesses and consumers. GOVERNMENT OF CANADA GOVERNMENT TAX a detailed The federal government produces that are part presentation on tax expenditures estimates of the federal tax system. The 2003 of federal tax expenditures include as projections to the year 2005 as well historical data. Since Saskatchewan's personal and corporate income taxes are based upon the federal definition of taxable income, many of the federal tax expenditures have an impact on Saskatchewan's revenue, not all of which estimates. Readers are shown in this paper’s interested in examining the federal government's presentation of tax expenditures are invited to contact the Finance Canada Distribution Centre in Ottawa (and click or visit the website www.fin.gc.ca on “Publications”). • • • • promote economic activity and create jobs, promote economic

While tax expenditures serve important social and economic objectives, the introduction of any tax expenditure results in associated costs. These costs take several forms. ASSOCIATED COSTS ASSOCIATED the largest corporations in the province the largest corporations tax. As a result, over are subject to the filing income tax returns 30,000 corporations are not subject to the in Saskatchewan capital tax. To tax rate on the corporate income processing (M&P) profits manufacturing and points, is reduced by up to seven percentage activity depending upon the level of business provides in Saskatchewan. Saskatchewan also Credit to assist M&P an Investment Tax new or companies that invest in qualifying used M&P assets for use in Saskatchewan. of In recognition of the importance Province's agriculture to Saskatchewan, the tax-free treatment to provides Fuel Tax farm-use diesel fuel, through a fuel-colouring of farm-use program, and a partial exemption gasoline when purchased in bulk. apply to Saskatchewan's sales tax does not home certain basic items such as food, children's heating fuel, residential electricity, clothing and reading materials, thereby reducing the taxes paid by families consuming these basic items. This treatment is in contrast to the federal Goods and (GST) and the sales taxes of Services Tax provinces that have harmonized their sales since those taxes apply taxes with the GST, to a much broader range of goods and services purchased by families. 48 Budget 2004-05 | Budget and Performance Plan Summary lower-income residents. in therateofProvincialSalesTax on enhanced tooffsettheimpactofincrease The SaskatchewanSalesTax Creditisbeing 2004. and snackfoodswillbe$52.3millionfor example, theexemptionforrestaurantmeals associated withtheTax alsoincrease.For Sales Tax, thevalueoftaxexpenditures W T T enhancements tothePost-SecondaryGraduate in theestimatesthatfollow, asarethe2004 the nationalrateofinflation.Thisisreflected credits andincometaxbrackets,isindexedto system, includingSaskatchewan’s familytax For 2004,Saskatchewan’s personalincometax 2004 SASKATCHEWAN TAX EXPENDITURES ax Credit. ax CreditandthePoliticalContributions ith theincreaseinrateofProvincial Statistics Canadadata. calculated usingtaxcollectiondataand Saskatchewan in2004.Theestimateswere major taxexpendituresoftheGovernment The followingtablesprovideestimatesofthe December 31,2003. Incentive Programexpiredon The LivestockandHorticulturalFacilities fuel exemptions. farmers willreceive$110.2millioninfarm be fullytaxexempt.For2004,Saskatchewan fuel purchasedforfarmusewillcontinueto will becomesubjecttotheFuelTax. Diesel used onprovincialroadsandhighways portion ofgasolinepurchasedbyfarmersis activities isbeingalteredtorecognizethata The taxexpenditureforfuelusedinfarming Budget and Performance Plan Summary | Budget 2004-05 49 ...... 88.9 ...... 52.3 ...... $ 37.3 ...... 8.9 ...... 5.5 ...... 9.2 ...... 2.2 ...... 21.5 ...... 46.7 ...... $ 8.0 ...... 0.9 ...... 0.1 ...... 18.9 ...... 88.1 ...... $ 110.2 ...... 0.3 ...... 213.4 ...... 111.1 ...... 5.7 1.4 ...... 0.1 ...... 28.3 ...... 11.8 ...... 6.5 ...... 31.1 ...... 10.3 ...... 38.5 ...... 41.7 ther...... onstruction ...... asic groceries...... estaurant meals and snack foods...... enditure Accounts –O –B –R –C onal Income Tax onal Income alue of Tax Expenditures in Millions of Dollars) Tax alue of 1. farm activity...... for Exemption 2. heating fuels...... for Exemption 3. primary for Exemption producers...... 1. Plan contributions...... Registered Pension 2. Plan contributions...... Registered Retirement Savings 3. Annual union, or like dues...... professional 4. Child care expenses...... 5. expenses Moving ...... 6. Carrying charges...... 7. expenses...... Allowable employment 8. $500,000 capital gains deduction...... 2.drugs...... Prescription 3. Electricity...... 4. machinery and repair parts...... Farm 5. Fertilizer, pesticide and seed...... 6. Food 7. Natural gas...... 8. materials...... Reading 9. Services 1. and footwear clothing Children’s ...... 10. amounts – exemption goods Used ...... 11. Direct agents...... 12. efficient appliances...... energy Eligible 13. telephone services Toll-free ...... 14. fire trucks...... Municipal 15. Mineral equipment...... exploration Pers Income Deductions from Fuel Tax Sales Tax Sales Exemptions 2004 Government of Saskatchewan2004 Government Tax Exp (V 50 Budget 2004-05 | Budget and Performance Plan Summary Co Corpora Non-refundable Saskatchewan Tax Credits Ot 5 Charitablecontributions tax credit...... 15. expensestaxcredit...... Medical 14...... Caregiver taxcredit 13. taxcredit...... Disability 12...... Studentloaninterest taxcredit 11...... Tuition andeducationtaxcredit 10. .ResearchandDevelopment Tax Credit...... 5. Investment Tax andProcessing...... Credit for Manufacturing 4. andProcessing Manufacturing Profits Tax Reduction...... 3. Tax Royalty Rebate...... 2. Lower taxrate for small business...... 1. 2. Exemption for co-operatives, credit unions, family farm family creditunions, Exemption for co-operatives, 2...... exemption General ofupto$17,500,000 1. Pension incometaxcredit...... 9...... Employment Insurancepremiums taxcredit 8...... Canada Pension Plancontributionstaxcredit 7. childtaxcredit...... Dependent 6. Supplementtotheagetaxcredit...... 5. Age taxcredit...... 4. Equivalent-to-spouse taxcredit...... 3. Spousaltaxcredit...... 2. Basicpersonaltaxcredit...... 1. 5. Saskatchewan Tax Incentives Program Tax Saskatchewan Incentives 5...... Exploration Mineral Tax Credit 4...... Graduate Post-Secondary Tax Credit 3. Political Contributions Tax Credit...... 2. Sales Saskatchewan Tax Credit...... 1. her Saskatchewan her Saskatchewan Tax Measures rporation Capital Tax oprtosadisrnecmais...... andinsurancecompanies corporations –L tion Income Tax abour-sponsored VentureCapital TaxCredit...... 28.9 ...... 6.0 ...... 27.8 ...... 0.6 ...... 14.0 ...... $488.3 $ ...... 8.7 ...... 45.5 ...... 15.3 ...... 1.1 ...... 0.3 ...... 14.2 ...... 1.3 32.0 ...... $ ...... 21.6 ...... 116.4 $ ...... 27.6 ...... 9.0 ...... 2.9 ...... 10.0 ...... $30.6 $ ...... 12.0 ...... 46.8 ...... 18.0 ...... 15.0 ...... 4.5 ...... 15.0 ...... Budget and Performance Plan Summary | Budget 2004-05 51 lowest overall family of two adults and two dependent family of two adults

children, owning their own home, with an children, owning of $75,000. annual family income The income of the two families is assumed to The income of the one earning be earned by both spouses, with 40 per cent 60 per cent and the other earning the exception of of total family income. With utilities, federal on the Goods and Services Tax taxes are not included in this comparison. The results of this survey show that with other Saskatoon compares favourably cities in Canada, having the 10 cities combined taxes and charges of the surveyed for each of the representative families. Saskatoon's There are a number of reasons for with favourable standing in this comparison other Canadian cities. combined Saskatoon has the second lowest charges for auto insurance, telephone, home heating and electricity in 2004. Also, housing costs in Saskatoon associated with mortgage payments and property taxes are among the lowest in Canada. seven The combined effect of Saskatchewan’s (PST) rate and per cent Provincial Sales Tax broad list of personal exemptions the PST’s means that Saskatchewan families pay among the lowest provincial sales tax in Canada. Alberta, which has no sales tax, levies health care premiums that exceed the sales tax paid in Saskatchewan by average families. •a and Household Charges Charges and Household 2004 Intercity Comparison of Taxes Taxes of Intercity2004 Comparison single person, living in rental family of two adults and two dependent

accommodation, with an annual income of $25,000; children, owning their own home, with an annual family income of $50,000; and, the level of taxation; and, household costs for rent and mortgages, utilities and auto insurance. wo other important factors that affect wo other important factors that •a A number of factors contribute to the quality A number of factors individuals and families in of life enjoyed by across Canada. For Saskatchewan and to excellent health care, example, access a key part education and social services is of the overall quality of life. T quality of life are: • • provincial Calculating the combined cost of is a taxes and typical household charges reliable way to compare the attractiveness of living in different parts of Canada. the For the purposes of such a comparison, charges for total cost of taxes and household Saskatoon, representative families living in has been Saskatchewan's largest city, compared with the costs those families would face in other major cities across the country. The provincial taxes and household charges associated with the following family characteristics and income levels have been calculated to provide a representative comparison: •a 52 Budget 2004-05 | Budget and Performance Plan Summary ealSlsTx400 420 Gaso Retail Sales Tax elhPeim 4 528 648 Health Premiums Tax Cred Tax Provincial Provincial •A in Saskatoon: will paythefollowingtotalprovincialtaxes cities. For2004theserepresentativeprofiles competitive withthosepaidinotherCanadian total provincialtaxesthatarevery Saskatchewan individualsandfamiliespay Total H Total Pr Total Single Person at$25,000 Total Income Comparison2004 Intercity of Taxes andHouseholdCharges Total et$918$7,932 $ 9,108 $ Rent •A lcrct 5 638 352 Electricity Auto Insura Auto Telephon ae 2, $ Taxes eae 0 0 Rebates noeTx$93$910 $ 903 $ Income Tax hre 1,0 $10,920 $11,202 Charges lowest taxlevelinCanada; $2,170 intotalprovincialtaxes,thefourth fifth lowesttaxlevelinCanada;and, pay $3,644intotalprovincialtaxes,the ieTx2590 205 line Tax

ousehold ovincial single personearning$25,000willpay two-income familyearning$50,000will its and e c ,0 2,036 1,409 nce acue C Vancouver 1,7 $12,448 $13,378 7 1,528 $ 176 3 314 333 laySsaonW Saskatoon algary $1, $7, $2, $9, $5, 150 441 669 456 170 626 628 615 907 306 (90) 0 $1,723 932 $1, $ $7, $1,882 $1, $9, $6, nie oot otélJh aia onS.John’s St. town Halifax John Montréal Toronto innipeg 45 12 (597) (142) (425) 7 1,4 ,2 ,4 1,6 ,2 9,655 $ 8,220 $ $10,164 7,744 $ 8,527 $ $14,546 779 6 1,5 1,1 1,7 1,0 1,7 $12,424 $10,572 $12,608 $10,271 $10,814 $16,052 661 1 4 6 4 5 4 165 910 140 641 155 864 145 864 167 774 147 569 115 469 9 1,0 ,3 ,7 ,5 ,2 6,240 $ 5,628 $ 7,152 $ 5,076 $ 6,336 $ $10,608 096 7 7 1 5 0 4 598 747 603 556 414 576 378 4 1 2 0 5 5 303 350 2,514 1,495 354 2,055 308 1,804 323 1,454 3,045 317 957 348 0000000 •A living costsfacingindividualsandfamilies. other Canadiancitieswhenconsideringthe Saskatoon compareveryfavourablywith All ofthesefactorscombinetomake 0 ,8 ,2 ,4 ,5 2,769 $ 2,352 $ 2,444 $ 2,527 $ 2,287 $ 506 fourth lowesttaxlevelinCanada. pay $6,732intotalprovincialtaxes,the

two-income familyearning$75,000will 4 ,1 ,2 ,7 1,694 $ 1,571 $ 1,425 $ 1,518 $ 943 an Charlotte- Saint 0000 Budget and Performance Plan Summary | Budget 2004-05 53 Saint Charlotte- Saint Charlotte- 000000 000000 307 $ 8,903 $ 8,211 $ 7,940 $ 7,734 $ 9,112 598 $ 2,915 $ 4,726 $ 4,606 $ 4,417 $ 5,206 470 $ 6,496 $ 5,690 $ 5,399 $ 5,731 $ 6,429 151 $ 1,024 $ 2,746 $ 2,606 $ 2,848 $ 3,095 0000000 0000000 957 3,045 1,454 1,804 2,055 1,495 2,514 957 3,045 1,454 1,804 2,055 1,495 2,514 348 317 323 308 354 350 303 348 317 323 308 354 350 303 590 877 605 851 951 1,118 883 590 877 605 851 951 1,118 883 230 294 334 290 310 280 330 947 1,153 1,557 1,690 1,690 1,289 1,781 230 294 334 290 310 280 330 131 $11,692 $ 5,597 $ 4,240 $ 5,595 $ 4,537 $ 4,118 131 $11,692 $ 5,597 $ 4,240 $ 5,595 $ 4,537 $ 4,118 (400) (400) 3,2051,506 3,070 1,693 2,531 2,402 1,600 2,082 2,142 2,062 2,000 1,775 1,000 1,852 3,2051,506 3,070 1,693 2,531 2,402 1,600 2,082 2,142 2,062 2,000 1,775 1,000 1,852 1,265 1,543 2,073 2,231 2,231 1,723 2,353 18,597 $26,001 $21,815 $19,096 $21,099 $19,009 $19,782 15,053 $23,292 $15,827 $15,611 $17,765 $15,692 $15,876 11,737 $20,694 $12,912 $10,885 $13,159 $11,275 $10,670 11,737 $20,694 $12,912 $10,885 $13,159 $11,275 $10,670 innipeg Toronto Montréal John Halifax town St. John’s innipeg Toronto Montréal John Halifax town St. John’s $5, $5, $ $ $6,860$5, $3,316$2, $5,765$3, $2,539$1, $ $ 0 0 0 0 907 907 306 944 306 944 990 990 732 644 300 215 903 441 300 2,250 1,342 2,250 1,342 1,217 $4, $4, $17,471 $14,383 $6, $3, $5, $2, $10,739 $10,739 algary Saskatoon W algary Saskatoon W 333 314 333 314 424 1,939 424 1,939 310 $ 5,118 188 $ 2,757 $25,212 $19,678 $23,090 $17,317 Vancouver C Vancouver C nce 1,409 2,036 nce 1,409 2,036 xes 2, xes 2, e e its and its and ovincial ovincial ousehold ousehold ncial ncial line Tax 410 180 line Tax 410 180 mily at $75,000 Total Income Total mily at $75,000 mily at $50,000 Total Income Total mily at $50,000 Rebates 0 0 Rebates 0 0 Income Tax $ 3,440 $ 3,882 Income Tax $ 1,624 $ 1,521 Charges $18,902 $14,560 Charges $18,902 $14,560 Taxes $ 6, Taxes $ 4, Auto Insura Auto Insura Telephon Home HeatingElectricity 1,629 1,323 569 974 Telephon Home HeatingElectricity 1,629 1,323 569 974 Property Ta Property Ta Mortgage Costs $12,538 $ 7,974 Mortgage Costs $12,538 $ 7,974 Gaso Tax Cred Health PremiumsTaxRetail Sales 1,296 1,056 858 0 Health PremiumsTaxRetail Sales 1,296 1,164 1,056 0 Tax Cred Gaso Total Total Total H Total Pr Fa 2004 Intercity Comparison of Taxes and Household Charges Taxes of 2004 Intercity Comparison Total H Total Pr 2004 Intercity Comparison of Taxes and Household Charges and Taxes of 2004 IntercityComparison Fa Provi Provi 54 Budget 2004-05 | Budget and Performance Plan Summary Rental Market Report, the CanadaMortgageand Housing Corporation’s apartment rentsforeachmetropolitan area,from Rent 2,000 litresforeachofthe families. of 1,000litresbythesinglepersonand Gasoline Tax based ontaxableexpendituresineachprovince. Provincial retailsalestaxeswerethenestimated to reflectSaskatchewanconsumptionpatterns. legislation, withtotalexpendituresadjusted province wasidentifiedfromtheenacting (Statistics Canada).Thesalestaxbaseineach from the expenditure basketsatthetotalincomelevels Retail SalesTax hospital insuranceandmedicalservices. Health Premiums rental paymentsandpropertytaxes. designed toreducetheimpactofretailsalestax, provincial incometaxcreditsandrebates T from federalincometax. T been reducedbytheQuébecChildCareExpense credits. GrossQuébecPersonalIncomeTax has used includetheCPP/QPPandEIcontribution (ages 6and12).Personalnon-refundablecredits care expensesfortwodependentchildren and thatthefamilieseachclaim$3,000inchild spouses ata60percentto40ratio assumed thatfamilyincomeisearnedbyboth $50,000 and$75,000incomerespectively. Itis individual with$25,000andtwofamilies Provincial IncomeTax Saskatchewan FinanceasofJanuary1,2004. charges arebasedoninformationavailableto changes asofMarch1,2004.Allhousehold Ta TA ax Creditandbythe16.5percentabatement ax CreditsandRebates x estimatesarecalculatedusingknown XES AND HOUSEHOLD CHARGES –NOTESXES ANDHOUSEHOLDCHARGES is basedonaverageone-bedroom Survey ofFamilyExpendituresin1996 is basedonannualconsumption is baseduponaveragefamily are annualpremiumsfor October 2003. is calculatedforan refer torefundable jurisdictions. discount hasbeenfactored intoallapplicable popular modelyear. TheSafeDriverRecognition registered inSaskatchewan, usingtheirmost used withthe34mostpopular lightvehicles index, thesesame34driver profileshavebeen developing theSaskatchewanAutoInsurance 34 profilestodescribetheaveragedriver. In Consumers AssociationofCanadadeveloped claims historyanddrivingrecord.In2003,the had thesamevehicle,coverage, driver wouldpayineachjurisdictionifthey actual insuranceratesquotedforwhatthe developed bySGI.Theindexisbasedonthe Auto Insurance applicable taxes,chargesandcredits. for individualresidences.Ratesincludeall T include allapplicabletaxes,chargesandcredits. and 8,100kWhforthehomeowners.Rates consumption levelof4,584kWhfortherenter Electricity and credits. Rates includeallapplicabletaxes,charges the BTUequivalentconsumptionoffueloil. For theAtlanticprovinces,figuresrepresent consumption levelof3,550m Home Heating included inthepropertytaxesfigures. education andlibrarypropertytaxesare Canadian HousePrices. the RoyalLePageThirdQuarter2003 estimated taxesforadetachedbungalow, from Property Taxes closed mortgagerateof5.0percent. being financedover25yearsataone-year House Prices, LePage ThirdQuarter2003 prices foradetachedbungalow, fromtheRoyal Mortgage Costs elephone charges arebasedonanannual charges arethebasicservicerates with one-halfofthehomeprice charges arebasedonanannual are basedontheaverage is basedonacompositeindex are basedonaveragehome All provincial,municipal, Survey ofCanadian 3 of naturalgas. Survey of Budget and Performance Plan Summary | Budget 2004-05 55 Crown corporations are responsible for the Crown corporations payments on their debt. principal and interest debt is incurred in the Crown corporation business, primarily for normal course of business investment in infrastructure and development initiatives which provide revenue streams to service the debt. debt Since March 31, 1994, Crown corporation billion, or has fallen by 37.4 per cent from $5.7 (GDP), 24.7 per cent of Gross Domestic Product per cent of to an estimated $3.5 billion, or 10.0 March 31, 2005. As at March 31, 2005, at GDP, 86 per cent of estimated Crown corporation corporations. debt will be for the utility Crown per cent Government debt has fallen by 10.4 per cent from a peak of $9.2 billion, or 40.3 1994 to an estimated at March 31, of GDP, at $8.3 billion, or 23.3 per cent of GDP, March 31, 2005. 2004-05 Borrowing and Debt and Borrowing 2004-05 less ross Debt – the amount of money owed ross Debt – the amount of money Guaranteed Debt – the debt of Crown Province corporations and others that the unable has promised to repay if they are to do so. to lenders; Sinking Funds – the amount of money which has been set aside for the repayment of debt. Debt plus guaranteed debt is used by most Debt plus guaranteed debt is used when members of the financial community as forecast analyzing creditworthiness. Debt debt. in the Budget includes guaranteed • The General Revenue Fund (GRF) borrows for The General Revenue Crown corporations. Government and financial Debt as reported in the Province’s statements is comprised of: •G • GENERAL REVENUE FUND DEBT 56 Budget 2004-05 | Budget and Performance Plan Summary As atMarch31 DEBT OF FUND REVENUE THE GENERAL As atMarch31 DEBT OF FUND REVENUE THE GENERAL rs et$3748$3904$3,822.0 $ 3,920.4 $ 3,784.8 $ Gross Debt Crown Corporation Debt ofDollars) (Millions et$1,2. 1,9. 11,632.3 $ 153.2 $11,794.1 11,827.5 $ 7,974.7 $ 115.6 (690.9) 8,083.7 Billions $ 8,512.4 $ (735.6) 79.0 30.8 8,288.3 $ 8,703.7 of $ Dollars (723.3) 8,932.6 1.3 $ (195.2) 3,657.6 $ 0.6 (211.3) 3,710.4 $ (246.2) 3,539.2 $ Debt Government Debt Guaranteed Debt Funds Sinking Gross Debt Government Debt Crown Corporation Debt Guaranteed Debt Funds Sinking 10 12 14 16 0 2 4 6 8 1994 $14.9 $9.2 $5.7 2003 $11.6 $8.0 $3.6 Government Debt 2004 $11.8 $8.1 $3.7 2005 $11.8 $8.3 $3.5 Crown CorporationDebt $8 $3 siae oeatActual Forecast Estimated 2006 $12.1 $8.4 $3.7 293$7981$7,821.5 $ 7,968.1 $ ,209.3 3,626.8 $ 3,709.1 $ ,538.6 0520 2003 2004 2005 2007 $12.2 $8.5 $3.7 2008 $12.1 $8.5 $3.6 Budget and Performance Plan Summary | Budget 2004-05 57 9.3% 31.5% 22.2% 2008 32.7% 10.0% 22.7% 2007 33.5% 10.3% 23.2% 2006 Crown Corporation Debt as a % of GDP GENERAL REVENUE FUND BORROWING through the sale of The Province borrows markets and through the securities in capital to Saskatchewan sale of savings bonds residents. borrowing 2004-05 The Province’s estimated to be requirements are compared to forecast $1,436.7 million, in 2003-04. requirements of $1,144.4 million in Borrowing requirements for Government million 2004-05, estimated to be $1,181.1 are to (2003-04 forecast - $736.8 million), million) and finance maturing debt ($1,109.1 other cash requirements. Borrowing requirements for Crown to be corporations in 2004-05, estimated – $255.6 million (2003-04 forecast refinance $407.6 million), are primarily to well as to debt borrowed on their behalf as assist in the financing of their activities. 33.3% 10.0% 23.3% 2005 33.2% 10.4% 22.8% 2004 Government Debt as a % of GDP 33.7% 10.6% 23.1% 2003 65% 24.7% 40.3% 1994

5

75 65 55 45 35 25 15 Per cent Per GRF DEBT AS A % OF GDP AS A % OF GRF DEBT As at March 31 Debt is forecast to increase by $161.8 million Debt is forecast $33.4 million in 2004-05. during 2003-04 and is forecast to increase by Government debt 2003-04 and $109.0 million during 2004-05. The increase $204.6 million in primarily due to the during 2004-05 is Saskatchewan reclassification of (SOCO) debt from Opportunities Corporation’s debt. Crown corporation debt to government debt is being $151.9 million of SOCO’s Fund in transferred to the General Revenue public recognition of the non-commercial, same time, policy nature of the assets. At the this transfer will reduce Crown corporation by debt, which is forecast to increase decrease by $52.8 million during 2003-04 and $171.2 million during 2004-05. to Debt as a percentage of GDP is forecast from decrease over the medium term 33.7 percent at March 31, 2003 to 31.5 percent at March 31, 2008. 58 Budget 2004-05 | Budget and Performance Plan Summary 1. The differencebetweenthesurplusandamountbywhichgovernmentdebtwillchangeisreconciledby: accrual basisofaccounting. The amountbywhichgovernmentdebtwillchangemaybehigherorlowerthanthesurplusreportedunder Cash AvCash (u by Provided Cash erae(nrae nGvrmn et$(0.)$(109.0) $ (204.6) 2 $ 1 Decrease (Increase) inGovernment Debt Surplus (onAccrual Accounting Basis) 2. 4. 3. 5. .Foreign Exchange Adjustment 4. Adjus .Cag nGaate et3. 37.6 36.6 (530.2) 178.1 ChangeinGuaranteed Debt 47.9 (120.0) 6. ReclassificationofDebt 3. Cash Sources(Requirements) Other 2. Adjustment toCash Basis 1. .Cag nSnigFns(73 44.6 (17.3) Funds ChangeinSinking 5. Ma dollardenominated debtat An exchange rate of$0.7462USper$1.00Canadian hasbeenusedtoconvert U.S. Corporation willbereclassifiedasgovernment debt. Opportunities debtofSaskatchewan During 2004-05, A expenditures to determine thecashprovided fromoperations; and A Canadian dollar; debt dueto changesintheexchange value ofthe Adjus debt; reduce investment todeterminethe andotheractivities inflows andoutflowsfromloan, A dding othercashsources othercashrequirements orsubtracting dding changes in sinking funds dding changesinsinking dding thechangeingovernment guaranteed debt. c 1 04adMrh3,20,cmae o$.86U tMrh3,2003. 31, comparedto$0.6806USatMarch 2005, 31, 2004andMarch rch 31, ailable to Reduce Debt ting thesurplusto acashbasis ting for foreign exchange rate changes sed for) Operations 1 Reconcil 2 hc ilb sdt ea oenetdb;and, which willbeusedtorepay government debt; to recognize the amount and and theamount to recognize iation ofSurplusandChange in Government Debt to restate the value of fo of value the restate to $( $0.1$ $( siae Forecast Estimated 040 2003-04 2004-05 119 0.0 (151.9) 1.)$239.8 $ 119.9) 20 (290.4) $ 72.0) . 99.2 0.0 ($ Millions) timing ofnon-cashrevenues to recognize the amount of cash of theamount to recognize reign currency denominated reign currency cash available to 61.7 Budget and Performance Plan Summary | Budget 2004-05 59 2004-05 2003-04 Estimated Forecast The cost of servicing government debt is The cost of servicing $9.0 million higher in estimated to be for 2003-04, due to 2004-05 than forecast higher debt levels. servicing cost estimates The 2004-05 debt per cent short-term and are based on 3.0 interest rates. An 6.0 per cent long-term $0.7462 US per $1.00 exchange rate of U.S. dollar Canadian has been used to convert 2004 and denominated debt as at March 31, March 31, 2005. in interest A one percentage point increase in rates for a full year from levels assumed cost the Budget would increase the estimated 2004-05 by of servicing government debt in approximately $11.7 million. the A one cent change in the value of U.S. dollar Canadian dollar compared to the would from the level assumed in the Budget of change the estimated cost in 2004-05 servicing government debt by approximately $1.4 million. SERVICING GOVERNMENT DEBT GOVERNMENT SERVICING tal Cost of Servicingtal Cost Debt Gross $ 894.4 $ 893.7 (Millions of Dollars) Debt Corporation Crown DebtGovernment To $ 280.4 $ 288.7 614.0 605.0 ST OF SERVICING DEBT ST OF SERVICING CO COST OF payments, debt In addition to interest the amortization of servicing costs include debt that is denominated in gains or losses on resulting from a change in foreign currencies, premiums, Canadian dollar, the value of the and other costs discounts, commissions debt. related to the Province’s debt are The servicing costs for government the paid by the GRF and are shown in 12. Estimates as Vote on behalf of Servicing costs of debt borrowed by the GRF Crown corporations are also paid Crown and are reimbursed by the respective in the corporations. These costs are shown 177. Estimates as Vote Debt servicing costs, primarily interest payments, associated with the Province’s gross debt are estimated to total million $894.4 million in 2004-05, $0.7 higher than the 2003-04 forecast. 60 Budget 2004-05 | Budget and Performance Plan Summary not responsibleforthisotherdebt. guaranteeing thedebtofothers.TheGRFis entities, eitherbyborrowingdirectlyor other organizationshaveobligationsto corporations. SomeCrowncorporationsand purposes ortheofcertainCrown guaranteed bytheGRFforeitherGovernment GRF debtincludesallborrowedor SUMMARY STATEMENT OFDEBT As atMarch31 SUMMARY STATEMENT OFDEBT R et$1,2. 1741$11,632.3 $ 11,794.1 $ 11,827.5 $ 12,030.5 7,974.7 $ $12,253.8 8,083.7 12,223.7 $ 3,657.6 8,288.3 $ 3,710.4 $ 3,539.2 $ Statement ofDebt Summary Ot Debt GRF forGRF Debt Government forGRF Debt Crown Corporations ofDollars) (Millions e et362497398.2 459.7 396.2 her Debt listing bothGRFdebtandotherdebt. calculates thedebtofgovernmententitiesby The SummaryStatementofDebtonpage80 siae oeatActual Forecast Estimated 0520 2003 2004 2005 Budget and Performance Plan Summary | Budget 2004-05 61 In 2000-01, the FSF was established with a In 2000-01, the FSF from the General $775.0 million transfer In 2001-02, a Revenue Fund (GRF). was made from $280.0 million transfer a balance of leaving the FSF to the GRF, 2002-03, an In $495.0 million in the FSF. from the $82.0 million transfer to the FSF balance at GRF was made, increasing the FSF to $577.0 million. year-end a The current 2003-04 forecast indicates FSF will be $275.4 million transfer from the leaving required to maintain a GRF balance, balance at $301.6 million. the FSF year-end that is, Slightly more than half of this – transferred $158.1 million – is forecast to be – to the GRF in 2004-05 and the remainder transferred $143.5 million – is forecast to be to the GRF in 2005-06. deplete These projected transfers will likely the FSF in 2005-06. scal Stabilization Fund Stabilization scal Fi 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 ansfer to/from GRFansfer 775.0 (280.0) 82.0 (275.4) (158.1) (143.5) 0.0 0.0 Tr FSF Closing Balance 775.0 495.0 577.0 301.6 143.5 0.0 0.0 0.0 (Millions of Dollars) FSF Opening Balance – 775.0 495.0 577.0 301.6 143.5 0.0 0.0 FISCAL STABILIZATION FUND BALANCES FUND FISCAL STABILIZATION Nowhere is a stabilization mechanism as key Nowhere is a stabilization planning as in to long-term fiscal its small open commodity Saskatchewan with subject to the vagaries of based economy world markets, a seemingly unresponsive and the large federal stabilization mechanism of weather and sometimes devastating effects on the provincial economy. was The Fiscal Stabilization Fund (FSF) established in 2000-01 as a budget the stabilization mechanism, formalizing transfers function historically performed by Gaming from the Saskatchewan Liquor and Authority and its predecessor the Saskatchewan Liquor Board. avoid The FSF allows the Government to to making disruptive short-term changes response existing policies and programs in revenue to large and unavoidable in-year from and spending volatility resulting circumstances originating beyond the province. 62 Budget 2004-05 | Budget and Performance Plan Summary GRF Financial Plan Results 2000-01 to2003-04Four-Year 2000-01 to2003-04 CUMULATIVE GRF BUDGET BALANCES 2000-01 to2003-04 GRF FINANCIALPLAN in 2000-01,asurplusof$1.1million The GRFrecordedasurplusof$57.7million 2000-01, culminatesin2003-04. The secondsuchplan,whichbeganin a cumulativebasisoverfour-year period. Revenue Fund(GRF)budgettobebalancedon The BalancedBudgetAct ugtBlne$5. . . 0.1 605.0 $ 0.9 611.4 329.7 $ 6,474.7 $ 1.1 6,145.0 616.8 694.2 $ 6,456.7 $ 5,762.5 57.7 664.1 337.9 $ 6,059.1 $ 5,721.2 1,496.8 6,753.6 $ Cumul 5,256.8 Budget Balance Tr Interest Operating Surplus Operating Spending Revenue ofDollars) (Millions

nfr(o/rmteFF(7.)200(20 275.4 Millions of (82.0) Dollars 280.0 (775.0) ansfer (to)/fromtheFSF tv aac 77$5. 97$59.8 $ 59.7 $ 58.8 $ 57.7 $ ative Balance 55 56 57 58 59 60 2000-01 Actual requires theGeneral 2001-02 000 010 020 2003-04 2002-03 2001-02 2000-01 Actual culAct Actual to total$59.8million. period from2000-01to2003-04areprojected Cumulatively, thesurplusesoverfour-year $0.1 millionfor2003-04. The 2004-05Budgetforecastsasurplusof 2002-03. 2001-02 andasurplusof$0.9millionin 2002-03 Actual a culForecast Actual ual Forecast 2003-04 2004 –2005 Saskatchewan Provincial Budget

General Revenue Fund (GRF) Budget Details 64 Budget 2004-05 | Budget and Performance Plan Summary Surplus forSurplus the Year...... eeu ...... Revenue A A Tr ...... Operating Expense prtn upu ...... Operating Surplus De Statement ofOperations Genera cmltdDfct Beginningof Year...... ccumulated Deficit, cmltdDfct n fYa (5,418,230) $ Endof Year ccumulated Deficit, ansfer from(to)Fiscal StabilizationFund...... bt Servicing ...... bt Servicing l Revenue Fund $67 $6 $ (5,418,297) siae oeatEstimated Forecast Estimated 6,134,533 (614,000) ,590,500 040 030 2003-04 2003-04 2004-05 158,100 455,967 (thousands ofdollars) $ $6 $( $ 54996 (5,479,966) (5,479,966) ,1,9)$(5,420,649) $ 5,418,297) ,8,3 5,911,383 6,083,431 6500 (650,000) (605,000) 4470$6,228,000 $ ,474,700 7,0 392,700 275,400 9,6 316,617 $ 391,269 169$59,317 $ 61,669 Budget and Performance Plan Summary | Budget 2004-05 65 4,6293,098 11,584 1,720 61,669 $ 59,317 97,469 96,961 86,227 $ (163,617) (42,138) (42,909) 219,301 $ 246,843 350,004 $ 372,962 115,065 (214,554) 239,792 $ (87,881) 563,833 539,397 213,829) $ (166,435) 159,037) $ (156,144) 159,037) $ (156,144) ,144,383 $ 1,243,658 (668,981) (604,115) (256,101) (392,700) Statement of Cash Flow Statement of Cash $ $ $( $1 $( $ $ $( $ (thousands of dollars) 4,596 1,385 l Revenue Fund l Revenue 84,866) 24,263 (45,871) 146,781) 327,289) 146,781) 119,905) 446,215 104,263 421,952 2004-05 2003-04 2003-04 ,436,736 (184,345) (178,100) Estimated Forecast Estimated (1,343,502) $1 $( $ $( $ $67 $( $( $( Genera and Investing Activities and Investing ncing Activities pital Activities 2 Lending r) Operating Activities for) Fina fo for) Ca ...... 1 ...... 1 ss on Loans and Investments...... ss on Loans Amortization of Foreign Exchange Loss...... Exchange Amortization of Foreign Amortization Assets...... of Capital Lo sh also includes temporary,short-term investments. (less than 30 days) bt Repayment...... pital Activities quisition of Capital Assets...... quisition of Capital nding and Investing Activities nding and Investing ee Schedule of Lending and Investing Activities for details. and Investing ee Schedule of Lending nancing Activities S Ca dd Non-cash Items: Net Change in Non-cash Operating Activities...... De Fi Borrowing...... Cash Provided by (used in Cash Increase (Decrease) 1 2 Increase (Decrease) in Deposits Held...... Disbursements Cash Provided by (used for) Cash Provided by (used Ac Cash Provided by (used Earningsin Sinking Retained Funds...... Operating Activities Operating Year...... the Surplus for A Le Receipts Ca 66 Budget 2004-05 | Budget and Performance Plan Summary To Individual Income...... Fu neet rmu,Dson n xhne...... andExchange Discount Premium, Interest, Health Reform Fund Ca Ca Co Co Taxes Sa eeu 6,590,500 $ 2 1 Revenue Tr Other Health Canada fr Transfers O Other Revenue Ot Ot Mo Fi Other Re Transf Ot Non-Renewable Resources Ot Taxes Ot Natural Gas...... Non-Renewable Resources qaiainPyet ...... Equalization Payments Tr Sa ...... Crown Investments Corporation ofSaskatchewan Tr Po ...... Oil Sa Schedule ofRevenue Genera Th amount fortheCanada HealthandSocial TransferIn 2004-05,the hasbeenseparated into theCanada Health Transfer andtheCana e,Forfeits andPenalties...... nes, nSuc eeu 5,264,800 $ wn-Source Revenue ansfers from Other Governments...... ansfers fromOther nfr rmteGvrmn fCnd 1,325,700 $ ansfers from theGovernment ofCanada ansfers from Crown Entities skatchewan Liquor and Gaming Authority...... LiquorandGaming skatchewan les...... les, Services and Service Fees...... andService Services les, ac ...... bacco el...... e ...... her ...... her ...... her her LicencesandPermits...... her Enterprises andFunds...... ah...... tash nada Social Transfer...... aaHat rnfr...... nada Health Transfer rp rp e 2003-04Budgetestimate forOther Transfers from theGovernment ofCanada included$32.0 millionfortheHealthReform Tran tor VehicleFees...... rto noe...... oration Income ...... oration Capital ers fromCrown Entities 2 ...... venue om theGovernment of Canada

and Social Transfer l Revenue Fund 2 ...... 1 ...... $ $ $ $– $ $ $3 $ $ siae oeatEstimated Forecast Estimated 1,016,700 1,292,200 ,543,900 040 030 2003-04 2003-04 2004-05 259,300 419,400 357,300 249,800 184,200 363,100 664,100 442,500 157,800 349,400 127,100 707,400 138,400 125,200 250,000 400,800 365,400 11,700 47,600 46,700 18,000 84,500 43,000 80,600 44,800 48,700 15,700 da Social Transfer. (thousands ofdollars) sfer.The HealthReform Transfer iscurrently itemized separately. $ $ $ $5 $6 $1 $ $3 $ $1 $ $ ,4,0 1,275,100 1,245,800 4680$5,173,300 $ ,446,800 4470$6,228,000 $ 1,054,700 $ ,474,700 ,027,900 3780$3,422,100 $ ,387,800 0160$816,800 $ ,091,600 5,0 851,700 340,900 851,700 310,700 7,0 167,100 350,400 173,300 350,900 5,0 687,800 $ 750,700 7,0 363,300 $ 378,300 0,0 162,600 205,600 2,0 122,200 122,200 600,200 $ 611,000 1,0 165,900 114,500 5,0 334,200 $ 356,400 3,0 490,100 119,100 $ 734,600 205,400 5,0 346,000 200,000 $ 358,000 200,000 130$12,900 $ 11,300 92049,700 49,200 010172,300 40,100 15032,000 31,500 02015,000 77,500 20,200 89,200 41,700 37,100 73,600 77,100 61042,200 46,100 54,200 53,000 82014,700 18,200 –– –– Budget and Performance Plan Summary | Budget 2004-05 67 3 109306 122 306 Schedule of Expense 5,755 5,755 7,7712,795 811 2,771 4,6448,696 5,526 8,696 7,964 7,964 3,565 5,365 7,396 7,420 23,165 24,165 14,130 14,261 18,307 18,546 47,891 43,718 22,108 17,608 65,951 69,641 37,917 38,373 380,393 $ 251,858 195,211 191,211 605,000 650,000 197,077 200,174 604,972118,296 607,135 118,359 120,548 108,261 187,594242,993 190,349 246,097 177,593 139,057 ,083,431 $ 5,911,383 ,688,431 $ 6,561,383 1,058,263 1,060,906 2,522,021 2,526,928 $6 $6 $ are restated to be consistent with the presentation with the presentation be consistent to restated are

(thousands of dollars) – 122 387 761 5,755 2,731 5,232 8,351 7,779 2,609 7,362 l Revenue Fund l Revenue 14,201 18,722 42,161 16,808 61,194 37,393 199,907 614,000 204,263 264,349 602,766 118,887 119,123 195,108 252,285 161,671 2004-05 2003-04 2003-04 ,134,533 1,097,140 2,687,416 Estimated Forecast Estimated $6 $ Genera ...... 1 ...... 2 ment Relations and Aboriginal Affairs...... rn incial Auditor...... icing Government Debticing Government ...... slative Branch of Government Branch slative ections Safety...... and Public – Teachers’– and Benefits Pensions ...... – Public Service and Benefits– Public Pensions r 2004-05,the for capital assets.For accrual accounting adopted Fund Revenue General purposes,amounts comparative for 2003-04 ve riculture, and Rural Revitalization...... Food lture,Youth and Recreation ...... nflict Commissioner...... of Interest mmunity and Employment...... Resources rr blic Service Commission...... ntenary Fund...... rv skatchewan Property Management Corporation...... skatchewan Council...... Research gislative Assemblygislative ...... arning ...... ov nance ...... Includes public service pension expenses related to all branches of government (executive,legislative of government all branches and judicial). to Includes public service related pension expenses of government. for the judicial branch Includes expenses Fo for 2004-05.A in the Supplementary Section. Information Expense is provided to of Expenditure Schedule Reconciliation Operating Expense ...... Expense1 2 3 $ 6,748,533 Pr Se Executive Branch of Government Branch Executive Ag Ce Co Labour...... Le Co Commissioner...... and Privacy Information Le Advocate...... Ombudsman and Children’s Go Highways and Transportation...... and Highways Co Cu Environment...... Northern Affairs...... Pu Sa Sa Chief Electoral Officer ...... Legi Health...... Industry and Resources...... Office...... Technology Information Justice Executive CouncilExecutive ...... Fi 68 Budget 2004-05 | Budget and Performance Plan Summary rw oprto et$37478$(246,181) $ 3,784,778 $ Debt plusGuaranteed Debt Government Purpose Debt plusGuaranteed Debt (33,592) Guaranteed Debt Debt 783,529 Government Debt Crown Corporation Debt SaskEnergy Incorporated...... rw netet oprto fSsacea ...... 280– 32,800 Ed ...... Crown Investments Corporation ofSaskatchewan Ag Crown Corporation Debt uiia iacn oprto fSsacea...... 500(53) – (5,944) 15,000 20,919 56,006 Sa Municipal Financing Corporation ofSaskatchewan...... Investment Inc. Saskatchewan Corporation ofSaskatchewan...... Information Services Crown Corporation Purpose akthwnTlcmuiain ...... 3,8 (41,855) (153,172) 431,384 Sa Sa 2,062,305 ...... Telecommunications Saskatchewan Sa PowerSaskatchewan Corporation...... Sa Sa As atMarch31 Schedule ofDebt Genera kthwnCo nuac oprto ...... 5,0 – 150,000 ...... Crop InsuranceCorporation skatchewan kthwnWtrhdAtoiy...... –– (4,714) – – (2,165) 65,488 (3,807) 5,500 – ...... WatershedAuthority skatchewan WaterCorporation...... skatchewan 83,004 Corporation...... Management Property skatchewan ...... Corporation Opportunities skatchewan HousingCorporation...... skatchewan cto nrsrcueFnnigCroain...... 7,4 (879) 78,843 Financingucation Infrastructure Corporation...... iutrlCei oprto fSsacea ...... – $ – $ ...... ricultural CreditCorporation ofSaskatchewan ...... 957– 79,597 ...... ,3,9 (723,292) 8,932,593 ...... l Revenue Fund ...... 90154(723,292) 9,011,554 ...... ,8,1 (246,181) $ 3,785,414 $ ...... $ $ $ rs etSnigFnsDebt Sinking Funds Gross Debt 27698$(969,473) $ 12,796,968 (969,473) $ 12,796,968 (969,473) $ 12,717,371 siae siae Estimated Estimated Estimated 0520 2005 2005 2005 (thousands ofdollars) $3 $– $ $ $ $3 11,827,495 11,827,495 11,747,898 8,209,301 8,288,262 1,909,133 ,538,597 ,539,233 749,937 150,000 389,529 79,597 32,800 77,964 14,947 14,975 56,006 60,774 79,197 3,335 – – Budget and Performance Plan Summary | Budget 2004-05 69 500 18,852 As at March 31 – – Schedule of Debt 191 $ 12,000 4,100 4,099 53,234 62,537 79,979 72,930 14,391 13,398 15,231 – 64,206 67,606 74,578 70,505 378,935 502,673 151,872 149,071 162,000 105,000 719,058 693,451 116,882 123,548 ,710,448 $ 3,719,228 ,709,151 $ 3,712,553 1,982,376 1,939,931 7,968,073 8,278,804 8,083,658 8,395,677 11,677,224 $ 11,991,357 11,794,106 $ 12,114,905 11,794,106 $ 12,114,905 $ $3 $ $ $3 $9, (thousands of dollars) – – Debt Debt Debt 2005 2004 2004 3,335 l Revenue Fund l Revenue 60,774 79,197 14,947 14,975 56,006 32,800 77,964 79,597 389,529 150,000 749,937 ,539,233 ,538,597 1,909,133 8,209,301 8,288,262 Estimated Forecast Estimated $3 $3 $– Genera ...... ricultural Credit Corporation of Saskatchewanricultural Credit Corporation ...... ucation Infrastructure Financing Corporation...... ucation Infrastructure Financing skatchewan Watershed skatchewanAuthority Watershed ...... skatchewan Property Management Corporation...... skatchewan Telecommunications ...... skatchewanCorporation...... Water skatchewan Power Corporation...... skatchewan Power skatchewan Opportunities Corporation ...... skatchewan Crop Insurance Corporation ...... skatchewan Housing Corporation...... skEnergy Incorporated...... skEnergy Sa Sa Sa Sa Sa Sa Sa Sa Municipal Financing Corporation of Saskatchewan...... Corporation Municipal Financing Investment Saskatchewan Inc.Investment ...... Debt $ 11,747,898 Crown Corporation Debt Corporation Crown Ag Information ServicesInformation of Saskatchewan...... Corporation Debt plus Guaranteed DebtDebt plus Guaranteed $ 11,827,495 Guaranteed Debt Guaranteed DebtDebt plus Guaranteed Purpose Government $ 11,827,495 Sa Debt Government Purpose Corporation Crown Crown Corporation Debt Corporation Crown Ed Crown Investments Corporation of Saskatchewan Corporation Investments Crown ...... 70 Budget 2004-05 | Budget and Performance Plan Summary nomto evcsCroaino akthwn...... 3,000 600 3,700 – 5,000 – Sa Sa – Sa 10,000 Sa Sa Sa 32,800 Municipal Financing Corporation ofSaskatchewan...... Corporation ofSaskatchewan...... Information Services Ed ...... Crown Investments Corporation ofSaskatchewan Ag Borrowing for Cr orwn o rw oprtos$2560$4769$371,200 $ 407,619 $ 255,600 $ 872,458 736,764 1,181,136 Bo ...... Borrowing for Government Borrowing for Crown Corporations Sa Schedule ofBorrowing Requirements Genera kthwnWtrhdAtoiy...... ––500 – 14,200 113,700 – 8,200 4,900 – 193,000 11,000 – 50,000 300,000 8,800 – 30,400 – ...... 101,600 WatershedAuthority skatchewan WaterCorporation...... skatchewan skatchewan Telecommunications HoldingCorporation...... Powerskatchewan Corporation...... Corporation Opportunities skatchewan ...... CropInsuranceCorporation skatchewan knryIcroae...... 6,0 – – 68,100 skEnergy Incorporated...... cto nrsrcueFnnigCroain...... 3903,1 32,400 36,719 3,900 Financingucation Infrastructure Corporation...... rwn eurmns$14676$11433$1,243,658 $ 1,144,383 $ 1,436,736 $ rrowing Requirements iutrlCei oprto fSsacea ...... 1,900 $ – $ – $ ...... ricultural CreditCorporation ofSaskatchewan own Corp own l Revenue Fund orations siae oeatEstimated Forecast Estimated 040 030 2003-04 2003-04 2004-05 (thousands ofdollars) Budget and Performance Plan Summary | Budget 2004-05 71 As at March 31 Schedule of Guaranteed Debt Schedule of Guaranteed (thousands of dollars) 2005 2004 2004 l Revenue Fund l Revenue Estimated Forecast Estimated Genera oration Act d Special Care Homes Act d Special Care ade Energy Inc.ade Energy Act ries I to Series VII (matured)ries I to Series ...... 36 47 52 ricultural Income Disaster Assistance Program...... 16 28 24 scar Ltd...... – – 157 nior Citizens’ Housing...... 38 57 57 skferco Products Inc. Products skferco ...... 3,706 38,254 29,355 leBonds (matured) ...... – – 157 Se eeder Associations Loan Guaranteeseeder Associations Loan ...... Guarantees...... eedlot Construction Loan 13,000 Guarantees...... eedlot Equity Loan 2,000 12,000 1,000 13,931 – – 3,000 – NewGrade Energy Inc...... NewGrade Energy 32,551 43,496 46,525 Sa National Trust Company...... National Trust Lu $ Bonds Savings Saskatchewan Power – Investments...... Guaranteed $ 600 450 $ 5,495 800 814 Se Te Breeder Associations Loan GuaranteesBreeder Associations Loan ...... F $Ag Guarantees...... Loan Individual Feedlot 20,000F $ Guarantees Loan Enhanced Feeder ...... F 19,000 5,000 $ 1,500 18,831 2,500 – 5,000 – her Guaranteed Debt her Guaranteed e Farm Financial Stability Act Financial e Farm her Guaranteed Debther Guaranteed $ 78,961 $ 115,585 $ 116,873 tal Guaranteed Debttal Guaranteed $ 79,597 $ 116,882 $ 123,548 he Saskatchewan Telecommunications Act Telecommunications he Saskatchewan he Industry Act Development and Commerce he Saskatchewan Development Fund Act he Saskatchewan Fund Development he Student Assistance and Student Aid Fund Act he Student Assistance and Student Aid Fund ...... 150 250 150 The NewGr T T Guaranteed Debt for Crown Corporations Crown Debt for Guaranteed The Power Corp T T Ot To Guaranteed Debt for Crown Corporations Crown DebtGuaranteed for Ot Th $ 636 $ 1,297 $ 6,675 The Housing an

2004 –2005 Saskatchewan Provincial Budget

Summary Financial Budget Details 74 Budget 2004-05 | Budget and Performance Plan Summary standards by2005-06. recommended governmentsadoptthesenew formally issuedinJanuary2003.PSAB capital assets.Thenewstandardswere accounting standardsforgovernment-owned In October2002,PSABapprovednew accounting. Accountants setsthestandardforgovernment of theCanadianInstituteChartered The PublicSectorAccountingBoard(PSAB) Acc and financialliabilities. government’s statementoffinancialassets whereby netdebtisreportedona assets wasconsistentwithanetdebtmodel This approachtothetreatmentofcapital years. highway mayservethepublicformany, many year thehighwaywasbuilt,eventhough was includedinoperatingspendingthe The fullcosttobuildahighway, forexample, were acquired(asrecommendedbyPSAB). recorded thecostsofallcapitalassetsasthey From 1957through2003-04,theGovernment CA THE PREVIOUSTREATMENT OF PI T AL ASSETS ounting for Capital Assets awarded tothethirdparties. grants inoperatingspendingastheyare governments toincludethefullvalueofthese assets. PSABcontinuestorequire used bythirdpartiestopurchasecapital referred toas“thirdpartycapital”,whichare the treatmentofcapitalgrants,commonly PSAB hasnotchangeditsrecommendationfor expense onitsoperatingstatement. government reportsa“usage”or“depreciation” Over time,asthehighwayisused, long lastingservicepotentialtothepublic. financial positionasanasset.Thisreflectsits reported onagovernment’s statementof to buildahighway, forexample,isinitially Under thenewrecommendation,fullcost assets. or “fullaccrualmodel”forreportingcapital 2004-05 Budget,isa“privatesectormodel” Saskatchewan isintroducingwiththe owned capitalassetstandard,which The newPSABrecommendedgovernment- THE NEWCAPITAL ASSETSTANDARDS Budget and Performance Plan Summary | Budget 2004-05 75 SION convert from expenditure to expense, the convert from expenditure to expense,

capital acquisition cost is subtracted and the capital acquisition cost is subtracted is added. cost of capital asset amortization EXPENDITURE acquired in The costs of goods and services has the fiscal year whether or not payment been made, including capital acquisitions, made interest on debt and transfer payments with or due. Expenditure is synonymous capital expense except expenditures include the acquisitions whereas expense reflects amortization of capital. EXPENSE The cost of goods and services acquired in the fiscal year whether or not payment has been made, including interest on debt and transfer payments made or due. Expense also includes the cost of amortizing (depreciating) capital assets. CONCLU of 2003-04, Saskatchewan’s Through the end is an expenditure- GRF operating spending which includes the full cost of based measure, government-owned assets. the acquisition of GRF Saskatchewan’s Beginning in 2004-05, is an expense-based operating spending includes the amortized value measure, which of government-owned capital assets. To ncluding capital assets and amortization including an annual “usage” or “depreciation” expense on a government’s operating statement presents a truer picture of the cost of government programs; reported government capital assets will be with on a basis that is more comparable the private sector; and, a net debt – the difference between financial assets and government’s to be financial liabilities – will continue reported. in the financial statements contributes to in the financial statements contributes and a focus on effective long-term capital maintenance plans; the new standard provides a better the new standard financial measure of a government’s resources available condition and the assets have since it shows government service potential”; “value” or “unexpired TIONALE FOR THE CHANGE TIONALE FOR THE • • • RA the change in accounting rationale for PSAB’s capital assets includes: for government-owned • •i 76 Budget 2004-05 | Budget and Performance Plan Summary neaec conigAjsmns...... (.)(.)(9.5) (6.7) (3.4) (8.9) (0.6) Accounting Adjustments...... Interagency Ot Sa 346.0 Sa (18.4) Sa 3.8 Sa Sa 358.0 Sa Sa (7.9) Sa (0.2) Sa 365.4 Sa Sa ...... Regional HealthAuthorities Regional Colleges...... Authority...... Liquor andGaming Ed Co Ag Ag Fi Treasury Board Board Treasury Sa Sa Sa eandSrlso rw aaeetBadOgnztos$5. 4. 96.0 (200.0) $ 147.4 (200.0) $ 56.5 (250.0) $ Su Retained Surplus ofCrown Management Board Organizations (434.4) Dividends included inGRFsurplus...... $ Ot (336.3) (390.3) $ (322.6) (402.6) $ Crown Investments Corporation (non-consolidated) (404.5) Crown Organizations ManagementBoard Surplus (Deficit)of Treasury Board Organizations Dividends includedinGRFsurplus...... Ad Genera netetSsacea n...... 147520.9 (2.5) 7.5 (5.8) 31.4 PowerSaskatchewan Corporation 1.5 Sa Sa Sa ...... Investment Inc. Saskatchewan Corporation...... Information Services Summary StatementofSurplus Summary Government of scal Stabilization Fund kthwnWtrhdAtoiy...... (.)(.)– – 0.2 – (2.6) (2.4) (1.9) 3.5 (1.1) 0.2 (1.2) (2.5) 2.1 (0.2) 42.3 (2.9) (0.4) (5.1) 0.5 1.7 0.2 (0.6) 2.0 (0.2) – 35.9 ...... WatershedAuthority skatchewan (0.7) (7.2) Student AidFund...... skatchewan (2.2) ResearchCouncil...... skatchewan (0.4) Corporation...... Management Property skatchewan 39.1 – ...... InstituteofAppliedScienceand skatchewan Technology HousingCorporation...... skatchewan (4.2) ...... HealthInformation Network skatchewan Grain Car Corporation...... skatchewan Corporation...... Gaming skatchewan Communications Corporation...... Network skatchewan Cancer Foundation...... skatchewan kthwnWtrCroain...... (.)(.)(3.0) (1.5) 94.6 (2.3) (2.1) 85.1 (1.4) (0.8) 41.0 WaterCorporation...... skatchewan Corporation...... Transportationskatchewan ...... skatchewan Telecommunications HoldingCompany kthwnOpruiisCroain...... 17(.)(0.2) 16.2 (0.2) 21.2 1.7 24.1 ...... Corporation Opportunities skatchewan Government Insurance...... skatchewan knryIcroae...... 1194. 82.0 41.0 101.9 skEnergy Incorporated...... e ...... 0.9 ...... her e raiain...... 1.)29(12.9) 2.9 (10.6) her Organizations...... cto nrsrcueFnnigCroain...... 06(41 (32.4) (34.1) 0.6 Financingucation Infrastructure Corporation...... rp mnt ntaie ud...... (.)(.)(0.6) (2.1) (2.1) ...... Initiatives Fund mmunity iutrlCei oprto fSsacea ...... 2.8 (3.9) (3.8) 3.8 (1.9) 3.7 ri-Food Innovation Fund...... ricultural CreditCorporation ofSaskatchewan utett con o eso ot na cra ai..... 151 4.)(25.7) (48.9) (135.1) justment toaccountfor pensioncostsonanaccrualbasis...... lu s l Revenue Fund (GRF) (D ef ic it) Organizations

Pr i or to

No ...... t-f or ...... 1 -P ro 4 ...... 1. 8. 100.0 187.2 112.0 ...... f it In su ra 2 Saskat nc e Or ga 3 ...... 58 35$(9.4) $ 13.5 $ (5.8) $ ...... ni za tio ns chewan $( $0.1$ $ $ siae oeatEstimated Forecast Estimated 040 030 2003-04 2003-04 2004-05 181 254 (392.7) (275.4) (158.1) 6.)$(8.)$(338.4) $ (188.9) $ 266.1) 0. 4. 296.0 $ 347.4 $ 306.5 19$6. (44.1) $ 66.3 $ 81.9 (millions ofdollars) 17$59.3 $ 61.7 . (1.1) 2.3 Budget and Performance Plan Summary | Budget 2004-05 77 chewan 5,705.4) $ (5,827.7) $( (millions of dollars) business plan. rd review. Summary Statement of Surplus Saskat

266.1) $ (188.9) $ (338.4) 2004-05 2003-04 2003-04 Estimated Forecast Estimated $( ns tio za ni ga Or e nc ra su 5 In it f Government of Government ro -P or t-f No

to or i Pr

it) ic ef (D s ers Compensation Board...... ers Compensation (10.3) (7.8) (6.5) lu rk e budgets of these organizations include grants from the GRF and are subject to Treasury Board review. Board Treasury subject the GRF and are to from include grants e budgets of these organizations basis,include on a calendar year are e budgets of these organizations CIC,and from grants Boa Management subject Crown are to the long term. be actuarily them to will allow sound over and fees that establish rates organizations ese insurance skPower’s 2004-05 amount reflects a significant change in planning assumptions subsequent to preparation of SaskPower’s 2004 of SaskPower’s preparation to change in planning assumptions subsequent reflects a significant 2004-05 amount skPower’s rp skatchewan Fund...... Auto skatchewan Crop Insurance Corporation $ ...... (19.8) $ – 11.5 $ (22.3) – – Th Th subsidiaries. from dividend revenue Excludes Sa Th ccumulated Deficit,ccumulated Year End of $ (5,989.2) ccumulated Deficit,ccumulated Year...... Beginning of (5,705.4) (5,468.5) (5,468.5) 1 2 3 4 5 Not-for-Profit Insurance Organizations Organizations Insurance Not-for-Profit A A Sa Sa of Saskatchewan...... Crop Reinsurance Fund Wo Organizations Insurance Surplus (Deficit) of Not-for-Profit 12.4Surplus (Deficit) $ (17.7) (51.7) $ (48.0) $ 8.0 (20.8) $ (283.8) $ (236.9) $ (359.2) Su 78 Budget 2004-05 | Budget and Performance Plan Summary Ca Non-Financial Assets upu Dfct 238 269 (359.2) $ (236.9) $ (283.8) $ 269.6 258.7 260.9 ...... Expense Amortization Surplus (Deficit) periods andassetthreshold amounts applicableto capitalassetsoftheGeneral Revenue Fund. Th A Pr Inventories...... Net Debt (9,713.7) Pr $ (9,605.2) (408.3) $ (9,917.3) $ $ (299.8) $ (312.1) $ (9,305.4 (9,305.4) (9,605.2) of End Year Net Debt, ...... of Beginning Year Net Debt, inNetDebt Decrease (Increase) Ac A Summary StatementofChangesinNetDebt Summary Government of As atMarch31,2003 andAccumulatedRestatement ofNetDebt Deficit Government of e net book value of capital assets per note 4 of the 2002-03 Summary Financial Statements is $3,734.8M.This amount hasbeena e netbookvalue Financial Statements ofcapitalassetspernote 4ofthe2002-03Summary is$3,734.8M.This ccumulated Deficit ccumulated Deficit epaid Expenses...... epaid Expenses...... usto fCptlAst...... 292 316 (318.7) (321.6) (289.2) quisition ofCapital Assets...... ia ses...... pital Assets ......

Saskat Saskat chewan chewan ...... 77.5 ...... 3,737.9 $ ...... siae oeatEstimated Forecast Estimated ...... 21.5 ...... (21.5) ...... 040 030 2003-04 2003-04 2004-05 djusted to subsequent reflect changesto theamortization (millions ofdollars) ...... (millions ofdollars) $(9, $(9, $(5, 305.4) 283.9) 468.5) 2003 ) Budget and Performance Plan Summary | Budget 2004-05 79 49.7 296.2 As at March 31 chewan (53.9) (125.1) 2005 2004 ,385.6 $ 7,564.5 ,928.1 $ 3,886.0 (millions of dollars) 9,917.3) $ (9,713.7) 17,302.9 $ 17,278.2 Estimated Estimated $7 $ $( $3 ... $ 8,209.3 $ 8,278.8 Saskat ...... $ 111.9 $ 189.4

...... 685.9 742.1 ...... 21.5 21.5 ...... 4,160.1 4,001.8 ...... 1,168.6 1,119.3 Summary Position Statement of Financial ...... $ 3,829.1 $ 3,787.0 ...... 77.5 77.5 Government of Government ncial Assets bt of Other Treasury Board OrganizationsTreasury bt of Other ...... Management Boardbt of Crown Organizations...... 491.0 3,327.8 3,553.7 4 sh and Cash Equivalents...... sh and Cash pital Assets...... her Liabilities...... her Financial Assetsher Financial ...... epaid Expenses ...... ccumulated Deficitccumulated $ (5,989.2) $ (5,827.7) ension Liabilities ...... Liabilities Debt...... Purpose GRF – Government De De Loss Exchange Unamortized Foreign ...... P A Pr Ot Net Debt Investment in Crown Management Board in Crown Organizations...... Investment 6,342.8 6,307.3 Non-Financial Assets Non-Financial Ca Inventories ...... GRF Organizations...... to Non-government Loans Ot 25.0 29.5 Fina Ca Board Organizations...... Treasury in Investment 220.0 80 Budget 2004-05 | Budget and Performance Plan Summary Treasury Boar Treasury rw aaeetBadOgnztos..3232115344736313,677.7 3,603.1 3,404.7 191.5 1 3,213.2 De Organizations.... Crown Board Management De Guaranteed Debt Debt ofCrown Management Sa 105.0 124.6 162.0 124.6 150.0 122.2 – 122.2 De Sa – Property Saskatchewan 150.0 Sa Sa Saskatchewan Crop Insurance Corporation...... Regional HealthAuthorities Municipal Financing Corporation In Education Credit Agricultural GRF –Government Purpose Debt et$1,4. 8. 2081$1,6. 12,282.2 $ 11,968.0 $ 12,028.1 $ 280.2 $ 11,749.9 $ Debt netetSsacea n...... 1. 501. – 67.6 15.2 64.2 15.0 56.0 – – Sa 15.0 TelecommunicationsSaskatchewan 56.0 Sa Sa ...... Investment Inc. Saskatchewan Corporation...... Information Services Crown Investments Corporation Crown Organizations ManagementBoard Ot Go As atMarch31 StatementofDebt Summary Government of Debt obta kthwnGmn oprto ...... –2. 863. 31.1 88.5 31.1 95.6 28.6 94.0 28.6 14.8 – 79.2 ...... WatershedAuthority skatchewan HousingCorporation...... skatchewan ...... Corporation Gaming skatchewan kthwnWtrCroain...... 08–6. 3262.5 149.1 53.2 151.9 60.8 2,041.1 – 2,083.6 – 2,008.4 – 60.8 99.2 – WaterCorporation...... skatchewan 1,909.2 Powerskatchewan Corporation...... Corporation.... Opportunities skatchewan knryIcroae ...... 4. . 5. 2. 698.3 723.9 754.7 4.8 749.9 ...... skEnergy Incorporated e rauyBadOgnztos...... 360247507570501.2 567.0 530.7 204.7 326.0 Organizations...... Board her Treasury bt bt bt ve fSsacea ...... 49–1. 4413.4 14.4 14.9 – Ma 14.9 ...... of Saskatchewan Bo odn oprto...... 8. 06401324516.2 392.4 18.9 $ 400.1 – 10.6 $ 32.8 $ 389.5 – Holding Corporation...... $ 32.8 $ ...... of Saskatchewan

rn of pl pl r raiain ,1. 1. ,2. ,8. 3,553.7 $ 3,484.4 $ 3,327.8 $ 114.6 $ 3,213.2 $ ard Organizations aeetCroain...... 4.1 4.1 3.3 – 3.3 nagement Corporation...... etProeDb...... ,8. ,8. ,8. 8,395.7 $ 8,083.7 $ 8,288.3 $ – $ 8,288.3 $ ment Purpose Debt......

us us ndb h eea eeu udfrisonueo nbhl fConcroain.The amount isnet ofsinkingfunds ined by the General Revenue Fund foritsown useor on behalfofCrown corporations. Ot

he

G G frastructure Financingfrastructure Corp uar uar r Tr d Organizations ea an an Corporation of Sask of Corporation ...... 7. 1. 9. 8. 292.4 285.8 195.6 116.0 79.6 ...... su t t eed eed ry

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Saskat $8 $ $ $ siae siae siae oeatEstimated Forecast Estimated Estimated Estimated GRF Debt Debt GRF 1875$362$1,2. 2238$12,574.6 $ 12,253.8 $ 12,223.7 $ 396.2 12,574.6 $ $ 12,253.8 $ 11,827.5 12,223.7 $ 396.2 $ 11,827.5 293$–$8293$7981$8,278.8 $ 7,968.1 $ 8,209.3 $ – $ ,209.3 2. 6. 9. 1. 449.7 $ 515.5 $ 491.0 $ 165.6 $ 325.4 0520 0520 2004 2004 2005 2005 2005 80–7. 4570.5 74.5 78.0 – 78.0 ––––0.5–––9.212.0 1 chewan te etTota Other Debt (millions ofdollars) . lTotalTotal