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Thursday, February 25, 2016

February 25, 2016

 

For Immediate Release

 

Premier Backtracks on Prior Comments on Borrowing

 

Keith Hutchings, Finance Critic for the Official Opposition Office, said Premier Dwight Ball's admission today that the province has indeed acquired long-term borrowing in the past year, and has itself secured long-term borrowing since coming to power, has led to more confusion on the ability of the Liberal administration to handle the current fiscal plan required and to be open and transparent with the people of the province.

 

The Premier was quoted in The Telegram today saying: "The question will always be, 'What are you going to do about your current situation?' The reaction will be much more positive if we have a plan that we can show them." This statement validates what we have been saying for the past number of months that the Ball government is content to kick the issues down the road and not act. http://www.thetelegram.com/News/Local/2016-02-24/article-4446692/Ball%26...

 

The bond-rating agencies have also raised concerns about the government's lack of a long-term plan. Standard & Poor's said January 29 they could revise their negative outlook if the government "develops a credible plan". Moody's said January 25 their outlook could be revised back to stable if the government "implements a comprehensive fiscal plan". DBRS said January 21: "Without a material improvement in the fiscal and debt outlook supported by a credible multi-year fiscal plan, a one-notch downgrade is likely."

 

https://www.standardandpoors.com/en_US/web/guest/article/-%20/view/type/...

 

https://www.moodys.com/research/Moodys-Changes-Outlook-to-Negative-Affir...

 

http://www.dbrs.com/research/289271/dbrs-changes-trend-to-negative-on-th...

 

When the Liberal government did a fiscal update in December, $1.9 billion debt was announced. Premier Ball shortly thereafter rescinded a 2% HST increase that would generate approximately $180 million annually in new revenue. Such an action was noticed by the lending agencies as a demonstration of no fiscal plan or indication that they were up to the task at hand.

 

http://www.releases.gov.nl.ca/releases/2015/exec/1222n02.aspx

 

http://www.cbc.ca/news/canada/newfoundland-labrador/trudeau-ball-hst-mem...

 

Hutchings said, "The Liberals came to office saying they had a plan, but now, even the Premier is admitting they do not have a long-term plan, and that lack of planning could hurt the province as we move to borrow and have our bond rating reassessed.”

 

By contrast, the PC government produced a long-term plan in Budget 2015, laying out the fiscal framework plan over the next five years to deal with issues. The Liberals canceled the plan soon after taking office by reversing the HST revenue component of the plan, which would have brought upwards of $180 million to the province annually, as well contradicting statements on reductions to public services and use of the private sector to enhance needed infrastructure.

 

http://www.budget.gov.nl.ca/budget2015/speech/default.htm#reality6

 

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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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