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Wednesday, February 24, 2016

February 24, 2016

 

For Immediate Release

 

Liberals Short on Financial Details

 

Keith Hutchings, Finance Critic for the Official Opposition, said the Liberal government’s assertion that the province’s long-term borrowing is at risk needs to be explained by Premier Ball, as the former PC administration was never turned down for long-term borrowing. Coupled with the global economic slowdown, the Liberals’ lack of a long-term plan has made credit agencies and lenders nervous, and that is a new factor no doubt impacting borrowing efforts.

 

Media reports indicated that Premier Ball has said the province could no longer borrow long term. Hutchings is asking the government to release the details, disclosing which banking institutions turned the province down for long-term financing and when. "The Premier should lay out the details of all financing efforts to date," said Hutchings. "Everyone has a stake in this, and people have a right to know the facts."

 

Hutchings said the global slowdown has made lenders cautious, which would be common to all jurisdictions, not specific to Newfoundland and Labrador. Recognizing this, the Liberal government has to step up its efforts to present lenders with a credible, long-term plan to assure them that the province will be able to meet its obligations. Our administration brought forward a long-term fiscal plan in Budget 2015, but when Premier Ball threw out the revenue side of the plan by canceling the HST increase without any forethought, he left the province with no long-term fiscal plan, and has produced no plan to replace it. It was after this action that the three bond-rating agencies raised concerns about the province's finances.

 

The issue with long-term borrowing would appear to be tied to the financial markets and vary from time to time during any year, reflecting what the market is receptive to. Without the Premier laying out the details, he appears to be raising alarms for no reason. It is not surprising that lenders are wary about the Liberals' approach, as they seem to be lurching from week to week with a different issue – with no plan and without any clear direction.

 

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Media Contact:

 

Heather MacLean, Director of Communications

 

Office of the Official Opposition, (709) 729 6105

 

heathermaclean@gov.nl.ca

 

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