2012-13 Pre-Budget Consultation Blaine Higgs Minister of Finance

Pre-Budget Consultations (2011-12) Unprecedented level of engagement by New Brunswickers through a variety of means: On-line pre-budget questionnaire; Dave@gnb.ca; Public and stakeholder meetings; Discussions with unions; Other email and written submissions.

Pre-Budget Consultations (2011-12) What We Heard Government should: Become smaller; Reduce costs; Be more efficient; Increase revenue; Focus on needs as opposed to wants.

Pre-Budget Consultations (2011-12) What We Did (short-term) Smaller government Size of Cabinet reduced; Fewer ridings in next election; Reduced senior bureaucracy positions; Hiring restrictions now in place. Reduced costs Controls placed on the wage bill; CEO & Deputy Minister bonuses suspended; Public and private pension reviews initiated.

Pre-Budget Consultations (2011-12) What We Did (short-term) Efficiencies Reduced travel and technology expenditures; Reduced government operations during Christmas season. Increase revenue Discontinued roll-out of personal and corporate tax cuts; Increased fuel and tobacco taxes; Increased user fees.

Government Renewal

Government Renewal 2011-12 Budget commitment; Launched by Premier on March 25, 2011; Largest public service engagement exercise undertaken in last 40 years.

Government Renewal – What We Learned Process is still underway, over 300 proposals identified; Common Themes: A need to manage public expectations; Opportunities to drive savings; Inefficient and ineffective processes; Means to generate more revenue efficiently; Alignment and accountability are necessary.

What We Learned – Public Expectations New Brunswickers need to be open to changes in the way services are delivered to ensure we can live within our means. This includes changes in such areas as: Health and senior care; Education; Social programs and services; Crown assets.

Distribution of Workforce 3,400 4,000 3,100 2,500 11,000 12,600 11,000

What We Learned – Attrition ($millions) Potential annual cost savings Replacement rate

What We Learned – Human Resources Wage bill; Absenteeism and sick leave; Vacation leave; Retirement allowances; Public sector pensions.

What We Learned - Procurement Better use of technology and streamlining processes Procurement Process Lower costs by being more strategic in how we buy goods and services Strategic Sourcing Legislation needs to be modernized Legislative Review

What We Learned - Collections Better use of technology, a more consistent collection policy and standardized processes Corporate Solution Lower costs by expanding the use of Canada Revenue Agency for the collection of receivables CRA Solution Legislation needs to be modernized Legislative Review

What We Learned – The NB Power Story Two years ago NB Power was for sale. NB Power is now running like a business. NB Power is showing measures of success in operating and service delivery. NB Power is focused on continuous improvement and accountability. NB Power has developed a long-term debt management plan that will see a reduction in debt over the next 10 years.

What We Learned – Highway Tolls Toll rate Cars Toll rate Trucks Annual Revenue 3 cents/km 9 cents/km $50M 5 cents/km 15 cents/km $84M 7 cents/km 20 cents/km $115M For example, a return trip from Moncton to Fredericton would cost $11 at 3 cents/km.

What We Learned - A Better Way to Manage Map Measure Manage Where are we going? Strategy Map Are we there yet? Measures Targets Can we react? Initiatives Review & Revise

Government Renewal - Next Steps The plan will focus on: Re-aligning government to focus on core services; Improving accountability through performance measures; Three-year budget target reductions; Better managing government resources.

Economic and Fiscal Challenges

Economic Challenges Real GDP growth (2012) % Draft Economic Challenges Real GDP growth (2012) % Source: NB Department of Finance

Fiscal Challenge New Brunswick faces a challenging fiscal environment going forward: Sizable imbalance between revenues and spending; Revenues impacted by weak economy; Higher debt service costs due to rising debt levels; Continued demand and cost pressures on social programs.

Where the Money Comes From 2011-2012 Budget Source: Department of Finance 2011-2012 Budget

Surplus / (Deficit) - ($millions) Draft Surplus / (Deficit) - ($millions) Our goal

Capital Expenditures - ($millions) Draft Capital Expenditures - ($millions) 2013 includes $544 million for Route One Gateway 2015 includes $152 million for Restigouche Hospital Centre

Draft Your Input is Required to Shape the 2012-2013 Budget and Future Budgets Seeking ideas on how to reduce spending or increase revenues: What services can be eliminated or reduced? What services can be delivered in a more affordable, efficient manner? What revenues should be increased to help balance the budget? Comments will be reviewed and considered as part of budget process.

Share Your Views Online at: Taxpayers FIRST: www.gnb.ca/nbfirst Draft Share Your Views Online at: Taxpayers FIRST: www.gnb.ca/nbfirst Written submissions by mail: 2012-2013 Pre-Budget Consultation Minister of Finance P.O. Box 6000 Fredericton NB E3B 5H1 By fax: 506-457-4989 By e-mail: wwwfin@gnb.ca Deadline is January 31, 2012