New Brunswick is projecting a deficit for the upcoming year, with government officials pointing to costly travel nurse contracts as the main driver.
That projected $27.6 million deficit for fiscal 2024-25 comes after the province recorded four major budget surpluses and had projected a surplus for the year of $40.9 million.
But an update Thursday showed the first quarter surplus was $150.4 million, below government’s budgeted $269.8 million surplus for the quarter.
Finance Minister Ernie Steeves said health expenses are behind the projection.
The Department of Health is projected to land $164-million over budget — $97 million of which the province is attributing to travel nurse contracts.
Vitalité Health Network’s travel nurse contracts represent the bulk of that number.
CBC News has reached out to Vitalité and is awaiting a response.
The province has been aware of the cost implications of those contracts since early 2023, deputy minister Eric Beaulieu told a legislative committee this summer.
Deputy minister Health, Eric Beaulieu, told a legislative committee the cost of travel nurse contracts were made clear to the department in March 2023. (Legislative Assembly of New Brunswick)
“The impact that travel nurses contracts are having on our bottom line is really no surprise,” Steeves told reporters on Thursday.
But he appeared to backtrack when asked why the budget wasn’t altered if the cost wasn’t a surprise.
“You’re always surprised at the amount of money and surprised by how it happened I guess,” he said.
“And then looking at how we can … come up with a solution and solve the problem. That’s ultimately where we are now, and where we’re moving forward to is, how do we solve this problem? This $97-million problem?”
Steeves noted the projected deficit is 0.2 per cent of the budget and said updated information in quarterly reports to come could change the outlook for the year.
More to come…
