TANNARA YELLAND
Associate News Editor

While it had resisted the global recession longer than most regions, Saskatchewan’s economy finally began to slow in 2009.

A drop in potash sales has been widely acknowledged as a major factor in this change, though Saskatoon Massey Place MLA Cam Broten feels the ruling Sask Party is more culpable than they seem willing to admit.

Broten is a member of the opposition NDP and serves as the Advanced Education, Employment, and Immigration critic. He was sure to stress that he considers Saskatchewan “a great place to live with probably a bright future,” and claims that the current state of Saskatchewan’s economy is due in large part to fiscal mismanagement on the part of the Sask Party.

“We’ve gone from billions of dollars in surplus (with the NDP) to now running a deficit of over one billion dollars,” Broten said. The NDP were defeated in election by the Sask Party two years ago.

The Royal Bank of Canada’s December 2009 Provincial Outlook paper says there was an astonishing 61 per cent decrease in potash production between August 2008 and August 2009. The Saskatchewan government collects royalties on the sale of potash mined in the province.

The government had predicted it would receive $1.9 billion in potash revenue in 2009, but the actual price was only $109 million. By many estimates this accounts for most of the $1 billion deficit.

Randy Burton, the spokesperson for the Ministry of Finance, was more optimistic about the future and made no comment about the deficit in a recent email.

“Most (private forecasters) are optimistic about the province’s economy in the coming year,” Burton said.

Burton explained that 2009 saw a dramatic decrease in potash sales, which accounts for many of the province’s new financial woes. He was quick to add that there will be increased mining in 2010, though he admitted that potash prices will still be only a fraction of the record highs seen in 2008, when potash was selling for over $1,000 per tonne.

Broten accepts that potash, a huge part of the Saskatchewan economy, is part of the problem. But he cites a 32 per cent increase in government funding since the last NDP budget as another area of contention.

“There have been a number of projects that, in and of themselves, have merit,” said Broten. “But when you’re in office, it’s not simply about what’s a good idea — you have to be responsible for the whole budget.”

The RBC was optimistic about what 2010 has in store for Saskatchewan, predicting 3.9 per cent growth in the economy.

Broten cautioned university students to take special notice of the government’s spending habits, noting that when governments spread themselves too thin tuition often suffers increases. He also said that while spending is important and necessary, it should be done in such a way that it will “leave the province in better shape than it was before.”

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photo: Flickr / rick